vil Appeals Nos
1221  1222 of 1977
From the Judgment dated 2011976 of the Andhra Pradesh High Court in Appeal Nos 758 and 632 of 1975
Mrs Shyamala Pappu and Ms Indira Sawhney for the Appel lants
TVSN Chari for the Respondent
The Judgment of the Court was delivered by FATHIMA BEEVI J
The appellants arc aggrieved that the High Court by the common judgment dated 2011976 in two cases had substantially reduced on erroneous grounds the enhanced compensation allowed by the Subordinate Judge on reference under Section 18 of the Land Acquisition Act for short the Act
Civil Appeal No 1222 of 1977 relates to acquisition of Ac
833 cents of land in Survey No 21 of Dondaparthi village in pursuance to Notification under Section 41 of the Act published on 771966 for construction of quarters for the staff of Porl Trust
Civil Appeal No 1221 of 1977 relates to acquisition of Ac168 cents of land in Survey No 22A of the same village in pursuance to the Notification published on 181968 for the purpose of formation of the national highway diversion road
The appellants claimed land value at the rate of Rs 10 per sq yard since the Land Acquisition Officer awarded only 088 paise per sq yard
The learned Subordinate Judge determined the market value of the land at the rate of Rs 11 per sq yard accepting as basis the value of land under the transactions evidenced by Exhibits A 1 to A 4 but granted the compensa 175 tion at the rate of Rs 10 per sq yard as the claimants themselves had claimed compensation at the rate of Rs 10 per sq yard
The State preferred appeal against the said judgment of the Subordinate Judge to the High Court of Andhra Pradesh
The High Court accepted Exhibits A I to A 4 as reflecting the value of land in the neighbourhood
It however following the decision of this Court in Tribeni Devi vs Collector Ranchi   that a deduction of 13 of the value is to be made when large extent of land is acquired under housing scheme determined the market value of the appellants land at the rate of Rs 650 paise per sq yard and accordingly reduced the total compensation allowed by the Subordinate Judge
The learned counsel for the appellants contended before us that the High Court had erroneously applied the principle laid down in Tribeni Devi s case supra without properly appreciating the nature of the land in question and the purpose for which it had been acquired
It was submitted that the land in question was fully developed and eminently suitable for being used as house sites and therefore there was no justification for making any deduction
It is also pointed out that even in respect of the land acquired for the purpose of formation of the road the High Court wrongly proceeded on the basis that expenses have to be incurred for development and thus in awarding the compensa tion the High Court wrongly applied principles of deduction of 13 of the value
The learned counsel has taken us through the relevant evidence and maintained that the learned Subordinate Judge had reduced the land value to Rs 10 per sq yard though the market value was higher at Rs 11 per sq yard only because the appellants had themselves limited the claim to Rs 10 per sq yard The learned counsel for the respondent maintained that the appellants  land forms part of large tract acquired for the purpose of construction of houses that the sale deed Exhibits A 1 to A 4 relate to small plots which are fully developed and when the transaction is compared it is neces sary to take into account the development that is required to be made for bringing the acquired land suitable for the purpose of construction and that the High Court was right in making the deduction of 13 of the value in the facts and circumstances of the case
In awarding compensation in acquisition proceedings the Court has necessarily to determine the market value of the land as on the date of the relevant Notification
It is useful to consider the value paid for similar land at the material time under genuine transactions
The market value envisages the price which a willing purchaser may pay under bona fide trans 176 fer to a willing seller
The land value can differ depending upon the extent and nature of the land sold
A fully de veloped small plot in an important locality may fetch a higher value than a larger area in an undeveloped condition and situated in a remote locality
By comparing the price shown in the transactions all variables have to be taken into consideration
The transaction in regard to smaller property cannot therefore be taken as a real basis for fixing the compensation for larger tracts of property
In fixing the market value of a large property on the basis of a sale transaction for smaller property generally a deduc tion is given taking into consideration the expenses re quired for development of the larger tract to make smaller plots within that area in order to compare with the small plots dealt with under the sale transaction
This principle has been stated by this Court in Tribeni Devi s case supra
In Kaushalya Devi vs Land Acquisition Officer   this Court observed at pages 912 913 as under When large tracts are acquired the transac tion in respect of small properties do not offer a proper guideline    
In certain other cases this Court indicated that for determining the market value of a large property on the basis of a sale transaction for smaller property a deduction should be given
 We shall also refer to the observations of this Court in Administrator General of West Bengal vs Collector Varanasi  The principle that evidence of market value of sales of small developed plots is not a safe guide in valuing large extents of land has to be understood in its proper perspec tive
The principle requires that prices fetched for small developed plots cannot directly be adopted in valuing large extents
However if it is shown that the large extent to be valued does admit of and is ripe for use for building purposes that building lots that could be laid out on the land would be good selling propositions and that valuation on the basis of the method of a hypothetical lay out could with justification be adopted then in valuing such small laid out sites the valua tion indicated by sale of comparable small sites in the area at or about the time of the notification would be relevant
In such a case necessary deductions for the extent of land required for the formation of roads and other civic amenities expenses of development of the sites by laying out roads drains sewers water and electricity lines and the interest on the outlays for the period of deferment of the realisation of the price the profits on the venture etc are to be made
 177 This Court has in a recent decision in Special Tahsil dar Land Acquisition Vishakapatnam vs Smt
A Mangala Gowri 19912 Scale 301 following Tribeni Devi s case pointed out as under It is to be noted that in building Regula tions setting apart the lands for development of roads drainage and other amenities like electricity etc
are condition precedent to approve lay out for building colonies
There fore based upon the situation of the land and the need for development the deduction shall be made
Where acquired land is in the midst of already developed land with amenities of roads drainage electricity etc
then deduction of 13 would not be justified
In the rural areas housing schemes relating to weaker sections deduction of 14 may be justi fied
 The principle of deduction in the land value covered by the comparable sale is thus adopted in order to arrive at the market value of the acquired land
In applying the principle it is necessary to consider all relevant facts
It is not the extent of the area covered under the acquisition the only relevant factor
Even in the vast area there may be land which is fully developed having all amenities and situated in an advantageous position
lf smaller area within the large tract is already developed and suitable for build ing purposes and have in its vicinity roads drainage electricity communications etc
then the principle of deduction simply for the reason that it is part of the large tract acquired may not be justified
The national highway runs very near to the proposed Port trust colony
The lands acquired already for the South Eastern Railway Staff Quarters lie to the southern side of the land under acquisition
The town planning trust road runs on the northern side of the land under acquisition
The colony is in the fast developing part of the municipal town
The plot of Ac 168 cents in Survey No 22A acquired for the formation of the diversion road is adjacent to built in area
The land involved in these cases is of even level and fit for construction without the necessity for levelling or reclamation
The High Court has itself conclud ed on the evidence that the lands covered by the acquisition are located by the side of the National Highway and the southern railway staff quarters with the town planning trust road on the north
The neighbouring areas are already de veloped ones and houses have been constructed and the land has potential value for being used as building sites
Having found that the land is to be valued only as building sites and stated the advantageous position in which the land in question lies though forming part of the larger area the High Court should not have applied the principles of deduc tion
It is not in every case that such deduction is to be allowed
Where the acquired land is in the 178 midst of already developed land with amenities of roads electricity etc
 the deduction in the value of the compara ble land is not warranted
The proposition that large area of land cannot possibly fetch a price at the same rate at which small plots are sold is not absolute proposition and in given circumstances it would be permissible to take into account the price fetched by the small plots of land
If the larger tract of land because of advantageous position is capable of being used for the purpose for which the smaller plots are used and is also situated in a developed area with little or no require ment of further development the principle of deduction of the value for purpose of comparison is not warranted
With regard to the nature of the plots involved in these two cases it has been satisfactorily shown on the evidence on record that the land has facilities of road and other ameni ties and is adjacent to a developed colony and in such circumstances it is possible to utilise the entire area in question as house sites
In respect of the land acquired for the road the same advantages are available and it did not require any further development
We are therefore of the view that the High Court has erred in applying the principle of deduction and reducing the fair market value of land from Rs 10 per sq yard to Rs 650 paise per sq yard
In our opinion no such deduction is justified in the facts and circumstances of these cases
The appellants therefore succeed
In the result the appeals are allowed and the respond ent is directed to pay the compensation as determined by the learned Subordinate Judge with interest and solatium in accordance with law
In the circumstances of the case we make no order as to costs
GN Appeals allowed


Summary:
The plaintiff Wakf Board s suit for declaration of the right to the passage and possession thereof having been dismissed by the Trial Court a title appeal was filed before the District Judge
A Court fee of Rs 15 was paid on the plaint by the Wakf Board by an exemption notification
On its memorandum of appeal the plaintiff had paid the same amount of court fee
Respondents asked for dismissal of the memorandum of appeal as it had not been sufficiently stamped
The Additional District Judge dismissed the memorandum of appeal
The High Court did not interfere when plaintiff took the matter before it
Hence this appeal by special leave by the plaintiff contending that the learned Additional District Judge in stead of dismissing the memorandum of appeal an opportunity should have been given and the appellant should have been called upon to make good the deficiency
Allowing the appeal this Court HELD 1
When the lower Appellate Court came to hold that the memorandum of appeal had not been sufficiently stamped an opportunity should have been given by the Court to the appellant to make good the balance court fee within a time to be indicated and if there was failure to comply with the direction of the Court the memorandum of appeal could 180 have been dismissed
This opportunity having not been given the dismissal of the appeal was not appropriate
181F G 2
This is a case of negligence on the part of the appellants andtherefore the respondents who have been dragged in these proceedings for about 10 years should be compensated by way of costs of Rs 1000
182 B