:1: IN THE HIGH COURT OF BOMBAY AT GOA FIRST APPEAL NO. 160 OF 2004 1. Dy. Collector (SDO) Sub-Division, Margao-Goa. 2. The Executive Engineer, W.D. VI ( R & B) P.W.D. Fatorda, Margao Goa. ... Appellants V e r s u s Shri Joseph Mascarenhas, R/o H.No.618, Murida, Cuncolim Goa. ... Respondent Ms. Sapna Mordekar, Additional Government Advocate for the Appellants. Mr. C. A. Coutinho, Advocate for the Respondent. CORAM : F. M. REIS, J DATE: 30 th SEPTEMBER, 2010. ORAL JUDGMENT The above Appeal challenges the judgment and award dated 10th October, 2003 passed by the learned IIIrd Additional District Judge, South Goa, Margao, in Land Acquisition Case No.78/98. The land of the Respondent came to be notified for acquisition under Section 4 of the Land Acquisition Act, 1894 ( hereinafter referred to as 'the said Act' ) by notification dated 15th May, 1991 published in the Official Gazette dated 21st May, 1991 admeasuring an area of 425 square metres from the survey No.136/16 at :2: Nuvem, for the extension of the road from Arcaband to Murida Pequeno linking Duncolim and Seraulim in Villages of Nuvem and Seraulim. The Land Acquisition Officer by an award under Section 11 of the said Act has fixed the compensation for the land acquired at the rate of Rs.7/- per square metre. 2. Being dissatisfied with the said award, the Respondent preferred a reference under Section 18 of the said Act and claimed a compensation at the rate of Rs.250/- per square metre for the land acquired. By judgment and award dated 10th October, 2003, the Reference Court fixed the compensation at the rate of Rs.43/- per square metre. 3. Being aggrieved by the said judgment, the Appellants have preferred the present Appeal. The learned Additional Government Advocate appearing for the Appellants has submitted that the Respondent has failed to establish that he is entitled to any enhancement of the compensation. She further pointed out that the Reference Court has relied upon a purchase document at Exhibit 15, though there is no evidence on record to substantiate that there was any escalation in the price from the year 1986 till the year 1991. The learned Counsel further submitted that the question of giving escalation of 10% on cumulative basis would not arise at all considering that the land acquired is a mundcarial area and such land had no motorable access to the main road and there is no evidence on record to demonstrate that the land acquired could be used for construction purpose. The learned Counsel as such submitted that the amount awarded by the Land Acquisition Officer is just and proper and the Reference Court had totally misdirected itself in enhancing the :3: compensation to Rs.43/- per square metre. 4. On the other hand, Mr. C. A. Coutinho, the learned Counsel appearing for the Respondent has supported the impugned judgment. He pointed out that admittedly the Respondent has purchased the land acquired pursuant to a sale instance at Exhibit 15 wherein the price fixed was Rs.29.65 per square metre for an area of 2057.18 square metres. He further pointed out that the law is well settled in cases in which there are sale instances in respect of which the land has been acquired, the question of reverting of any sale instance beyond the land acquired would not arise at all. The learned Counsel further submitted that it is well settled that escalation should be 10% on cumulative basis and as such no interference is called for in the impugned judgment. 5. Having heard the learned Counsel for the Appellants and the Respondent and on perusal of the records, the following point for determination arise in the present Appeal. POINT FOR DETERMINATION Whether the Reference Court was justified to fix the market value of the acquired land at the rate of Rs.43/- per square metre ? 6. The record reveals that the land which was the subject matter of the acquisition was in fact purchased by the Respondent pursuant to a sale :4: instance at Exhibit 15. In the cross examination of AW1, the genuineness of the said sale instance has not at all been disputed by the Appellants herein. There is no suggestion to the effect that the amount paid to the vendors was in fact not paid by the Respondent at the time of the purchase of the said land or that the said sale transaction was sham and nominal. As such there can be no dispute with regard to the genuineness of the said sale instance at Exhibit 15. There is no dispute that the land acquired was a part and parcel of the land which was purchased by the Respondent pursuant to the said document at Exhibit 15. Normally when the sale instance of the land acquired is relied upon for the purpose of determining the compensation, there is no need for the Respondent to establish any comparability with such land. It is not the case of the Appellants that there was any depreciation in the value of the land after the land was purchased by the Respondent in the year 1987 due to any special circumstances. On perusal of the evidence on record, AW1 has admitted that the land acquired was not adjoining any public road. In fact AW1 has stated that the access to the main road is through the property of one Mrs. Filomena Gomes who is a private owner of the property adjoining the main road. There is no evidence on record adduced by the Respondent to substantiate that the land acquired was suitable for construction purpose. In fact the learned Counsel appearing for the Respondent was unable to show anything on record to the effect that the land which was purchased by the Respondent had any development potentiality. In view of the failure on the part of the Respondent to adduce such evidence, the land which was purchased will have to be evaluated on the basis that the same is an agricultural land. The Apex Court in the judgment reported in 2008 (14) S.C.C. 745 In the case of General :5: Manager, Oil and Natural Gas Corporation Limited V/s Rameshbhai Jivanbhai Patel and another has held at para 14 thus : “14. On the other extreme, in remote rural areas where there was no chance of any development and hardly any buyers, the prices stagnated for years or rose marginally at a nominal rate of 1% or 2% per annum. There is thus a significant difference in increases in market value of lands in urban/semi-urban areas and increases in market value of lands in the rural areas. Therefore, if the increase in market value in urban/semi-urban areas is about 10% to 15% per annum, the corresponding increases in rural areas would at best be only around half of it, that is, about 5% to 7.5% per annum. This rule of thumb refers to the general trend in the nineties, to be adopted in the absence of clear and specific evidence relating to increase in prices. Where there are special reasons for applying a higher rate of increase, or any specific evidence relating to the actual increase in prices, then the increase to be applied would depend upon the same.” 7. Considering the land acquired is situated in rural area and the potentiality for using for non-agricultural purpose has not been established by the Respondent by any evidence, I find that a just escalation would be 7.5% per annum on cumulative basis. After giving such escalation, the amount as on the date of the notification works out to Rs.40/- per square metre approximately. I accordingly fix the market value of the land acquired as on the date of Section 4 notification is at the rate of Rs.40/- per square metre. The :6: Reference Court as such was not justified to give an escalation of 10% per annum. The point for determination is answered accordingly. 8. In view of the above, the Appeal is partly allowed. The impugned judgment and award dated 10th October, 2003 is modified and the market value of the acquired land is fixed at the rate of Rs.40/- per square metre. The remaining part of the award granting statutory benefits is confirmed. 9. The Registrar is directed after three months to compute the amount payable to the Respondent in accordance with the above judgment and disburse the amount so determined with accrued interest. The excess amount deposited be refunded to the Appellants along with accrued interest. F. M. REIS, J at*