Report No. 10
We are also not in favour of omitting section 23(2) so as to exclude the solatium of 15% for the compulsory nature of the acquisition. It is not enough for a person to get the market value of the land as compensation in order to place himself in a position similar to that which he would have occupied, had there been no acquisition; he may have to spend a considerable further amount for putting himself in the same position as before. If, for example, the only property a person possessed was three acres of arable land and he was deprived of this under the compulsory power of acquisition, he would no doubt get the market value of his property; but he would not be in a position to provide himself with a vocation to which he had been all along accustomed. He must find suitable land in or about the locality where he resides which may not be easily available and he may have to wait and spend more than the amount of compensation he has obtained.
As pointed out by Fitzgerald, the community has no right to enrich itself by deliberately taking away the property of any of its members in such circumstances, without providing adequate compensation for it. This principle has been in force in India ever since the Act of 1870 (vide section 42), The Select Committee which examined the Bill of 1893 did not think it necessary to omit the provision but on the other hand transferred it to section 23. There is equity behind the rule, as the transfer of the land is not voluntary but compulsory. It may be of interest to notice that in the United States of America the same principles as laid down in the Chemudu case, ILR 1939 Mad 532 PC, are in vogue and we think it more equitable to follow the principles accepted in the United States rather than adopt the recent much criticized changes in the law in England.
54. The only ground urged in support of the omission of section 23(2) is that there has been an abnormal increase in land values. The policy of fixation of ceilings on land holdings, the uncertainty regarding the future trend of legislation and the increase in the cost of cultivation, have led, on the contrary, to a considerable fall in the land values in rural areas in recent years. To avoid the loss of property under such anticipated legislation, sales and partitions of land have enormously increased. In urban areas the position may be somewhat different but the rise in land values generally corresponds to the rise in the price level and the fall in the value of money. We think, therefore, that the reasoning on which the proposed omission of section 23(2) is based cannot be supported.
55. Two principles from section 2 of the English Act of 1919, the acceptance of which have also been suggested by some of the States, have, however, been adopted by us.
The first is, that any increase in the value of the land, arising from its being put to unlawful use should not be taken into consideration; and the second is, that an increase in the rental value of a building which is so over-crowded as to be detrimental to the health of the inmates should also be left out of consideration. We have made suitable amendments to section 24 giving effect to these principles. Lastly, we have considered a proposal made to change the date of determining the market value under section 23(1) to the date of the taking of possession of the land by the Government. Under the scheme proposed by us, there will not be much lapse of time between the date of the notification under section 4 and the taking of possession of the land by the Government. We see no reason for accepting the proposed change.