ivil Appeal No 2216 N of 1970
From the Judgment and Order dated 1831970 of the Rajasthan High Court in DB Civil Regular First Appeal No 10 of 1960
SK Jain for the Appellants
Miss Maya Rao for the Respondents
Not present 647 The Judgment of the Court was delivered by SEN J
The present appeal on certificate raises two questions namely 1 Whether the parties by mutual consent had agreed to appoint DN Gupta Superintending Engineer and Town Planning Officer Jaipur to ascertain the value of the disputed land as an appraiser or valuer and therefore the appraisement or valuation thereof by him in his Report Exh5 dated February 21 1956 at Rs 3582650p
should be treated as an admission under s20 of the Evidence Act 1872 on the basis of which the plaintiff s claim for damages had to be decreed and 2 Whether the plaintiff being deprived of property was on general principles entitled to payment of interest on the amount payable to him as the value of the property taken by the State Government
The facts bearing on the questions are briefly stated
In accordance with the terms of the registered deed of exchange executed by the parties on July 16 1951 the appellant withdrew a suit for specific performance of an alleged contract against the State Government being Civil Suit No 12050 pending in the Court of the Civil Judge Jaipur City whereunder the State Government agreed to give in exchange plot No O17 located in Scheme on resumption of his plot bearing No C91 in the same scheme and handed over possession to the State Government on the aforesaid plot No C91 but the State Government on their part did not give possession of the exchanged plot to him in consequence whereof the appellant instituted a suit for possession of the exchanged plot and for mesne profits thereof against the State Government being Civil Suit No 27051 in the Court of the Civil Judge Jaipur City
The State Government in their written statement pleaded inter alia that the suit was not maintainable since the plot which was to be given in exchange to the appellant did not belong to them but did not disclose as to whom the said plot belonged
The appellant therefore served interrogatories on the State Government
In reply to the said interrogatories it was revealed in the affidavit filed by the State Government that the exchanged plot had been transferred to Thakur Harisingh of Achrol under the orders of the Home Minister Government of India dated January 8 1945 and that plot No C91 which belonged to the appellant was then in possession of the Raj Pramukh Maharaja Mansinghji of Jaipur
The appellant accordingly impleaded Thakur Harising of Achrol as a defendant in the suit and sought 648 permission from the Central Government under s86 of the Civil Procedure Code 1908 to join Maharaja Mansingji of Jaipur as a party to the suit
Thakur Harisingh of Achorol being impleaded as a defendant in the suit filed his written statement and raised an objection that the valuation of the land in dispute was Rs 40000 and the Court of Civil Judge Jaipur City had no jurisdiction to entertain the suit
That objection of his was sustained and the learned Civil Judge by his order dated October 15 1955 returned the plaint for presentation to the proper Court
It transpires that the Joint Secretary Ministry of Home Affairs Government of India addressed a letter dated January 3 1956 to the late Shri Mohan Lal Sukhadia the then Chief Minister of Rajasthan conveying that it was felt that the appellant had a case and should be given the exchanged plot and if that was not feasible he should be restored to his original position and therefore could claim back possession of plot No C91
At the instance of the Chief Minister for Local Self Government gave a hearing to the plaintiff on January 12 1956 in the presence of the Secretary Urban Improvement Board Jaipur
On February 3 1956 the Chief Minister addressed a letter to the Joint Secretary Ministry of Home Affairs conveying the anxiety of the State Government to settle the claim of the appellant and intimated that the appellant had agreed to the appointment of DN Gupta Town Planning Officer as the assessor who had been asked to assess the value of the land and submit his report by February 20 1956
He therefore requested the Government of India to defer its decision in fairness to the State Government for a couple of months as it was felt that it might be possible to settle the matter without any unreasonable delay
The aforesaid assessor DN Gupta by his report Exh 5 dated February 21 1956 put the valuation of the disputed land admeasuring 5000 square yards  Rs 7 per square yard amounting to Rs 35000 and to this he added Rs 82650p
as the cost of construction of a boundary wall ie Rs 3582650p
in all
There ensued a correspondence between the State Government and the appellant as regards the payment of compensation
It was felt by the State Government that the assessor had wrongly taken into consideration parta rates or the Municipal Committee Jaipur which could not form any legal basis for assessing the value of the disputed land which admittedly was situated outside the walled city of Jaipur nor could he have taken into consideration the rates for the sale of 649 plots of commercial site at a distance from the disputed land
The State Government accordingly declined to pay Rs 3582650p
The suit out of which the present appeal arises was instituted by the appellant on February 4 1957 as plaintiff for recovery of Rs 4774150p
ie Rs 3582650p
as value of the disputed land in 1951 and Rs 11915 as interest at 6 per annum by way of damages
The State Government contested the plaintiff s claim and pleaded inter alia that the State Government had never agreed that the assessment or valuation made by DN Gupta of the disputed land was to be final and binding on them that there was an error of principle in the assessment or valuation made by him based as it was on the parta rates of the Municipal Committee Jaipur which admittedly was not applicable to the disputed land which was situate outside the walled city of Jaipur or the rate for the sale of plots of commercial site situate at a distance there from and that since there was no sale of land in C Scheme in the vicinity of the exchanged plot the correct value thereof had to be assessed on the basis of the C Scheme rates and therefore the real market value of the disputed land admeasuring 5000 square yards on the basis of the full rate in Scheme of the Urban Improvement Board at Rs 350p
per square yard must work out to Rs 17000 and nothing more
The learned Senior Civil Judge as well as the High Court have however decreed the plaintiff s claim in part for a sum of Rs 17500 with interest thereon  6 per annum from February 4 1957 the date of institution of the suit till realization on the ground that the State Government was not bound by the assessment made by DN Gupta based on parta rates of the Municipal Committee Jaipur which were not applicable to lands situate outside the walled city of Jaipur and could not form any legal basis for valuation of the disputed land and therefore the State Government was not bound to pay Rs 3582650p
as determined by him
They have further held that the market value of the disputed land on the basis of the full rate of similar plot applicable in C Scheme in 1951 was Rs 350p
per square yard and therefore the plaintiff was entitled to recovery of Rs 17500 as the value thereof
The learned Subordinate Judge held that on the admission of the plaintiff himself as PW 6 and his two witnesses Parmanand Secretary Urban Improvement Board PW 3 and Shah Alamuddin Deputy Minister PW 5 it was clear that DN Gupta had been appointed merely to assess the value of the disputed land and that it was never agreed that whatever appraisement or valuation he may make would be binding on both the parties nor did the 650 Deputy Minister make any commitment on behalf of the State Government that whatever assessment DN Gupta would make would be binding on the State Government and that therefore the appraisement or valuation made by DN Gupta in his report Exh5 dated February 21 1956 could not be treated as an admission of liability  under s20 of the Evidence Act on the part of the State Government
He further held that the correct value on the basis of the notification issued by the Urban Improvement Board clearly showed that the parta rate of the Municipal Committee Jaipur was not applicable to the disputed land which was situate outside the old walled city of Jaipur and that the correct value thereof could be assessed on the basis of C Scheme rates and therefore the value of the disputed land Rs 17500
The learned Judge however held that the plaintiff was entitled to receive damages by way of interest  6 per annum
On appeal the High Court held that the plaintiff had to prove that the State Government had agreed to be bound by the assessment made by DN Gupta before s20 of the Evidence Act could be attracted and that there was no evidence that the State Government had ever agreed to be bound by the said assessment
As regards the letter addressed by the Chief Minister to the Joint Secretary Ministry of Home Affairs Government of India dated February 3 1956 the High Court observed that the Chief Minister was not examined as a witness and when admittedly he was not present when the talk between the Deputy Minister for Local Self Government and the plaintiff took place the latter would not necessarily lead to the inference that the State Government agreed to abide by the assessment made by DN Gupta
It accordingly affirmed the finding of the learned Subordinate Judge that the appraisement or valuation made by DN Gupta was not binding on the State Government and further that the disputed land was much inferior than land included in C Scheme and therefore the amount of Rs 17500 awarded by the learned Subordinate Judge was quite adequate
Following the decision of this Court in Satinder Singh vs Amrao Singh it held that the plaintiff was entitled to interest thereon at 6 per annum
The main question raised is whether the report of the assessor Exh 5 was information  within the meaning of s20 of the Evidence 651 Act and therefore considered to be an admission of the parties as to appraisement or valuation of the disputed land at Rs 3582650p
and such an admission must operate as estoppel
Admissions may operate as estoppel and they do so where parties had agreed to abide by them
The word information  occurring in s20 is not to be understood in the sense that the parties desired to know something which none of them had any knowledge of
Where there is a dispute as regards a certain question and the Court is in need of information regarding the truth on that point any statement which the referee may make is nevertheless information within the purview of s20
The contention on behalf of the State Government on the word information  occurring in this section is that the parties did not stand in need of obtaining any information from DN Gupta and that at any rate the State Government never agreed to abide by the valuation made by him and therefore they were not bound by the same inasmuch as the valuation made by him was not conclusive as to the value of the subject matter as between the parties
S20 of the Evidence Act reads as follows 20
Admissions by persons expressly referred to by party to suit Statements made by persons to whom a party to the suit has expressly referred for information in reference to a matter in dispute are admissions
 Illustration The question is whether a horse sold by A to B is sound
A says to B Go and ask C C knows all about it
 C S statement is an admission
S20 is the second exception to the general rule laid down in s18
It deals with one class of vicarious admission ie admissions of persons other than the party
Where a party refers to a third person for some information or an opinion on a matter in dispute the statements made by the third person are receivable as admissions against the person referring
The reason is that when a party refers to another person for a statement of his views the party approves of his utterance in anticipation and adopts that as his own
The principle is the same as that of reference to arbitration
A position analogous to that of agency is created by the reference
652 The reference may be by express words or by conduct but in any case there must be a clear intention to refer and such admissions are generally conclusive
As Ellenbrough LCJ said in Williams vs Innes from which the illustration is taken If a man refers another upon any particular business to a third person he is bound by what this third person says or does concerning it as much as if that had been said or done by himself
 There is nothing on record to show that the State Government ever agreed to abide by the valuation made by the assessor DN Gupta on the contrary the Secretary Local Self Government by his letter dated June 30 1951 had conveyed to the appellant sanction for allotment of the exchanged plot admeasuring 5000 square yards on condition that the terms of allotment would be the same as in the case of the previous allotment meaning thereby that the plaintiff would have to pay as per the rates fixed by the Government for the sale of plots in C Scheme
The testimony of Shah Alimuddin Deputy Minister for Local Self Government clearly shows that he gave a hearing to the appellant and had deputed DN Gupta Town Planning Officer to assess the valuation of the disputed land but he did not make any commitment on behalf of the State Government that whatever assessment was made by him would be binding on the Government
This hearing was given by the Minister on January 12 1956 at the instance of the Chief Minister at which Parmanand the then Secretary Urban Improvement Board was also present
As a result of this DN Gupta was appointed to determine the market value of the disputed land by letter of the Secretary to the State Government Local Self Government Department dated February 4 1956 which was in these terms From The Secretary to the Government of Rajasthan
653 To Shri DN Gupta through the Chief Engineer
BR PWD Rajasthan Jaipur
No F1 K 56 LSG59 dated Jaipur the February 4 1956
Sub Allotment of land to Shri Heera Chand Kothari
With reference to the above I am directed to forward herewith a full history of the case and to say that the case was heard by the Deputy Minister for Local Self Government on 12156
Shri Heera Chand Kothari and the Secretary Urban Improvement Board Jaipur were present
Shri Kothari has agreed to accept the compensation of 5000 sq
of land and to appoint you as assessor
I am therefore to request you kindly to assess the value of land 5000 sq yds which is situated between the Railway Crossing and the bungalow of Maharani Sahib of Mysore on the date it was allotted to Shri Kothari and to send your report to this department by the 20th February 1956
Sd Secretary to the Government As already stated the assessor DN Gupta submitted his report Exh5 dated February 21 1956 wherein he valued the land  Rs7 per square yard that is at Rs 35000 and added the cost of construction of the boundary wall at Rs 82650p
totalling Rs 3582650p
The State Government not being satisfied at the exorbitant value so determined were not prepared to accept the valuation made by the assessor DN Gupta
Accordingly the Secretary Local Self Government by his letter dated March 14 1956 asked him to explain the basis of valuation adopted by him
In reply thereto DN Gupta by his letter dated March 19 1956 disclosed that he had assessed the value of the disputed land at the least possible price taking the value of lands spread over between the years 1948 and 1955 and that he had adopted the parta rates of the Municipal Committee Jaipur for determining the value of the disputed land
While we feel that the High Court was not right in excluding from its consideration the Chief Minister s letter dated February 654 3 1956 on the ground of want of proof the document by itself does not substantiate the plaintiff s claim that the parties had by mutual consent agreed to appoint DN Gupta to ascertain the value of the disputed plot as an appraiser or valuer and therefore the valuation thereof put by him in his report Exh 5 dated February 21 1956 at Rs 3582650p
being based on an erroneous principle should be treated as information  within the terms of section 20 of the Evidence Act 1872 and therefore an admission which must operate as estoppel against the State Government
The High Court was therefore justified in upholding the judgment of the learned Subordinate Judge that the report of DN Gupta dated February 21 1956 making an appraisement or valuation at Rs 3582650p
could not be treated as an admission under section 20 of the Evidence Act on the basis of which the plaintiff s claim for damages had to be decreed
Nevertheless this Court as well as the High Court and the learned Subordinate Judge had ample power to restitute the plaintiff by granting him compensation for the value of property of which he had been deprived in the year 1951
As already stated the value of the exchanged plot had to be determined in accordance with the terms of the letter dated June 30 1951 addressed by the Secretary Local Self Government to the appellant by which he conveyed the sanction of the State Government for allotment of the exchanged plot admeasuring 5000 square yards on an application made by him to the Urban Improvement Board
The grant was subject to the condition that the terms of the allotment would be the same as in the case of the previous allotment  ie had to be valued as per the rates prescribed by the State Government for Improvement Trust plots in C Scheme
The market value of the exchanged plot on the basis of full rate of similar plot situate outside the walled city of Jaipur abutting the main road applicable in Scheme in 1951 was Rs 350 per square yard and therefore the plaintiff was entitled to recover Rs 17500 upon that basis
Admittedly the State Government had not fixed any parta rates for land situate outside the walled city of Jaipur
The testimony of Shiv Ram Jain Secretary Urban Improvement Board Jaipur DW 2 shows that the Maharani of Mysore was allotted a plot in the near vicinity of plot No C91 in C Scheme not as a concessional but on normal rate at Rs 10000 per acre
If that were to be the basis the appellant would be entitled to compensation at a much lesser rate
The matter however does not end there
The transaction of 655 exchange which fell through in 1951 was entered into before the formation of the State of Rajasthan
At that time Jaipur was not the capital of the State and there was no trend in rise of prices of land
Once it was known that Jaipur would be the capital the value of land particularly in an exclusive area near and around the palatial bungalow of the Maharani of Mysore which later became Raj Bhawan which was extremely scarce had naturally shot up
The land in dispute was situate near the railway station and which according to the High Court was lesser in value than land in C Scheme
Taking all these factors into consideration we think it just and proper to award the appellant a sum of Rs 25000 as compensation towards the value of the exchanged plot and to award him a reasonable rate of interest to offset the spiral rise of value of land in the city of Jaipur
We are clearly of the view that the plaintiff having been deprived of the property was entitled to a reasonable rate of interest on the amount found to be due to him
In somewhat similar circumstances the Court speaking through Gajendragadkar J in Satinder Singh s case relied upon the speech of Viscount Cave LC in Swift  Co vs Board of Trade and observed Stated broadly the act of taking possession of immovable property generally implies an agreement to pay interest on the value of the property and it is on this principle that a claim for interest is made against the State
This question has been considered on several occasions and the general principle on which the contention is raised by the claimants has been upheld
In Swift  Co vs Board of Trade supra it has been held by the House of Lords that on a contract for the sale and purchase of land it is the practice of the Court of Chancery to require the purchaser to pay interest on his purchase money from the date when he took or might safely have taken possession of the land  This principle has been recognized ever since the decision in Birch vs Joy  In his speech Viscount Cave LC added that this practice rests upon the view that the act of taking possession is an implied agreement to pay interest and he points out that the said rule has been extended to cases of compulsory purchase under the Lands Clauses Consolidation Act 1845
In this connec 656 tion is drawn between acquisition or sales of land and requisition of goods by the State
In regard to cases falling under the latter category this rule would not apply
 We are in respectful agreement with these observations
It was further held in Amrao Singh s case that the Court had ample power under proviso to section 1 of the Interest Act 1839 to award interest on equitable grounds
In all the facts and circumstances of the case the reasonable rate of interest would be 6 per annum on the compensation amount of Rs 25000 from August 13 1951 the date of dispossession till August 31 1959 the date of judgment of the learned Subordinate Judge and thereafter at 9 per annum thereon till realization
It more or less works out to Rs 95000 which is a multiple of 20 times the actual investment of the appellant in purchasing plot No C91 in C Scheme in the city of Jaipur
The result therefore is that the appeal partly succeeds and is allowed with costs
The judgment and decree of the High Court and those of the learned Subordinate Judge are modified by decreeing the plaintiff s claim for compensation at Rs 25000 with interest as indicated above
The appellant will be entitled to recover and be liable to pay costs in proportion to success and failure
NVK Appeal allowed


Summary:
Pursuant to a registered deed of exchange dated July 16 1951 executed between the parties the appellant withdrew a suit for specific performance of an alleged contract against the State Government under which the Government were to resume his plot No C91 in C  Scheme allotted to him by Improvement Trust Jaipur for a sum of Rs 5000 in 1951 and give in exchange another plot in the same scheme on the same terms
Under the terms of the deed the State Government agreed to give in exchange plot No O17 in C  Scheme to the appellant on resumption of his plot bearing no C91
In terms thereof the appellant handed over possession of his plot No C91 to the State Government but the State Government on their part did not give possession of the exchanged plot to him
Thereupon the appellant brought a suit for possession of the exchanged plot and for mesne profits thereof
It was revealed in answer to the interrogatories served by the appellant that the exchanged plot had already been transferred by the State Government to Thakur Hari Singh of Achrol under the orders of the Home Minister Government of India dated January 81945 and that plot No C91 which belonged to the appellant was then in possession of the Raj Pramukh Maharaja of Jaipur
The appellant accordingly impleaded Thakur Harisingh of Achrol as a party to the suit and sought permission from the Central Government under section 86 of the Code of Civil Procedure 1908 to join Maharaja Mansinghji of Jaipur as a party to the suit
The objection raised by Thakur Harisingh of Achrol as to the pecuniary jurisdiction of the Court was sustained and the Civil Judge Jaipur City returned the plaint for presentation to the proper Court
It transpired during the pendency of the aforesaid suit that the Joint Secretary Ministry of Home Affairs Government of India had addressed a letter dated January 3 1956 to the then Chief Minister of Rajasthan conveying that it was felt that the appellant had a case and should be given the exchanged plot and if that was not feasible he should be restored back in possession of plot No C91
In response to the same the Chief Minister addressed a letter dated February 3 1956 to the Joint Secretary Ministry of Home Affairs conveying the anxiety of the State Government to settle the claim of the appellant and intimated that the appellant had agreed to the appointment of the Town Planning Officer Jaipur as the assess or who had been asked to assess the 645 value of the land and submit his report with a request that the Government of India should defer its decision in fairness to the State Government for a couple of months as it was felt that it might be possible to settle the claim without any unreasonable delay
The Town Planning Officer by his report Exh 5 dated February 21 1956 put the valuation of the disputed land in 1951 admeasuring 5000 square yards at Rs 7 per square yard at 35000 and to this he added Rs 82650p as the cost of construction of a boundary wall ie Rs 35826 50p
in all
651 G H 652 A The State Government declined to pay the compensation
The appellant instituted the present suit for recovery of Rs 4774150p
as damages ie Rs 3582650p
to wards the value of disputed land and Rs 11915 as compensation
The Civil Judge held that on the admission of the plaintiff as P W 6 and his witnesses Secretary Urban Improvement Board
PW 3 and the Deputy Minister it was clear that the Town Planning Officer was appointed merely to assess the value of the disputed land and that it was never agreed that whatever appraisement or valuation that he may make would be binding on both the parties nor did the Deputy Minister make any commitment that such assessment would be binding on the State Government and that therefore the appraisement or valuation could not be treated as an admission of liability  under section 20 of the Evidence Act 1872 on the part of the State Government
It was further held that the correct value on the basis of the notification issued by the Urban Improvement Board clearly showed that the part rate of the Municipal Committee was not applicable to the disputed land which was situated outside the walled city
The suit was decreed in part for Rs 17000 with damages by way of interest at 6
On appeal the High Court held that the plaintiff had to prove that the State Government had agreed to be bound by the assessment made by the Town Planning Officer before s20 of the Act 1872 could be attracted and that there was no evidence that the State Government had ever agreed to be bound by the said assessment and that reliance cannot be placed upon the letter dated February 3 1956 of the Chief Minister as the Chief Minister was not examined as a witness
It upheld the finding of the Trial Court that the appraisement or valuation made by the Town Planning Officer was not binding on the State Government and that the disputed land was of an inferior type and affirmed the judgment and decree of the Trial Court
Allowing the Appeal  HELD 1
Admissions may operate as estoppel and they do so where parties had agreed to abide by them
The word information  occurring in section 20 of the Evidence Act 1872 is not to be understood in the sense that the parties desired to know something which none of them had knowledge of
Where there is a dispute as regards a certain question and the Court in need of information regarding the truth on that point any statement which the referee may make is nevertheless information  within the purview of section 20
section 20 is the second exception to the General rule laid down in section 18
It deals with one class of 646 vicarious admissions that is admissions of persons other than the party
Where a party refers to a third person for some information or an opinion on a matter in dispute the statements made by the third person are receivable as admissions against the person referring
The reason is that when a party refers to another person for a statement of his views the party approves of his utterance in anticipation and adopts that as his own
The principle is the same as that of reference to arbitration
The reference may be by express words or by conduct but in any case there must be a clear admission to refer and such admissions are generally conclusive
651 A B G H 652 A 2
The High Court was not right in excluding from its consideration the Chief Minister s letter dated February 3 1956 on the ground of want of proof
The document by itself does not substantiate the plaintiff s claim that the parties had by mutual consent agreed to appoint the Town Planning Officer to ascertain the value of the disputed plot as an appraiser or valuer
653 H 654A 3
The High Court was justified in upholding the judgment of the Subordinate Judge that the report of the Town Planning Officer making an appraisement or valuation at Rs 3582650p could not be treated as an admission under section 20 of the Evidence Act on the basis of which the plaintiffs  claim for damages had to be decreed
654 B C 4
This Court as well as the High Court and the Subordinate Court had ample power to restitute the plaintiff by granting him compensation for the value of the property of which he had been deprived in the years 1951
Taking all factors into consideration it is just and proper to award the appellant a sum of Rs 25000 as compensation towards the value of the exchanged plot
The plaintiff having been deprived of the property he was entitled a reasonable rate of interest on the amount is necessary
The Court has ample power under proviso to section I of the Interest Act 1839 to award interest on equitable grounds
The reasonable rate of interest would be 6 per annum on the compensation amount of Rs 25000 from August 13 1951 the date of dispossession till August 31 1959 the date of judgment of the Subordinate Judge and thereafter at 9 per annum thereon till realization
654 D 655 C 656 BC Satinder Singh vs Amrao Singh   referred to