IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE PIUS C.KURIAKOSE & THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM THURSDAY, THE 18TH MARCH 2010 / 27TH PHALGUNA 1931 LA.App..No. 1070 of 2007() -------------------------- LAR.7/2006 of III ADDL.SUB COURT, ERNAKULAM .................... APPELLANT(S): 2ND RESPONDENT: ----------------------------- THE MANAGING DIRECTOR, KERALA INDUSTRIAL INFRASTRUCTURE DEVELOPMENT CORPORATION (KINFRA), KINFRA HOUSE ANNEX, T.C.NO.9/2585, ELANKOM GARDENS, VELLAYAMBALAM, THIRUVANANTHAPURAM-10. BY ADV. MR.G.S.REGHUNATH RESPONDENT(S): CLAIMANTS AND 1ST RESPONDENT: -------------------------------------------- 1. K.P.JOSEPH, KACHAPPILLI HOUSE, ARANGATH ROAD, KOCHI. 2. SANTHA JOSEPH, W/O.J.P.JOSEPH, DO, DO. 3. STATE OF KERALA REPRESENTED BY THE SPECIAL TAHSILDAR (LA), KOCHI REFINERIES LTD., VYTTILA, N.F.GATE, TRIPUNITHURA, ERNAKULAM DISTRICT. ADVS. MR. JOSE JOSEPH ARAYAKUNNEL MR. VARGHESE PARAMBIL SR.GOVT. PLEADER MR.BASANT BALAJI FOR R3 THIS LAND ACQUISITION APPEAL HAVING BEEN FINALLY HEARD ON 18/03/2010, ALONG WITH LAA NO.1466 OF 2007 AND CONNECTED CASES AND C.O. NO.61 OF 2007 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: LAA1070/07 ORDER ON I.A.2707 OF 2007 IN LAA.1070 OF 2007 DISMISSED. SD/- PIUS C. KURIAKOSE, JUDGE. SD/- C.K. ABDUL REHIM, JUDGE. 18.3.2010 okb /True copy/ P.A. to Judge PIUS C.KURIAKOSE & C.K.ABDUL REHIM, JJ. ------------------------------------------------------------- L.A.A.Nos.1070, 1466 & 1829 of 2007, 585,590,878,1006,1349 & 1394 of 2008 and Cross Objection No.61 of 2007 in L.A.A.No.1070 of 2007 ---------------------------------------------------------- Dated this the day of March, 2010 J U D G M E N T --------------------- Abdul Rehim,J. Out of these 9 appeals, LAA.Nos:1829 of 2007 & 590, 878, 1006, 1349, 1394 of 2008 are filed by the State of Kerala. LAA.Nos:1466/07, 1070/07 and LAA.No:585/2008 are filed by the Managing Director, Kerala Industrial Infrastructure Development Corporation (KINFRA). The appeals are filed against Judgments and Decrees of the Sub Court, Ernakulam. The appellants are challenging the quantum of enhancement granted by the reference court. In C.O.No:61/07 filed in LAA.No:1070/07, the land owners/claimants are seeking enhancement of compensation granted by the reference court. Since all the cases arise out of acquisition for the same purpose made through the same notification issued under Section 4(i) of the Land Acquisition Act, they are disposed of through a common Judgment. The parties herein are referred to as 'claimants' and L.A.A.1070/07 & connected cases 2 'respondents' as in the order they are mentioned in the reference cases. 2. The acquisition in question was for the purpose of expansion of “KINFRA Export Promotion Industrial Park (KEPIP)”. The acquired properties are situated in Kakkanad Village in Kanayannoor Taluk, comprised under different survey numbers. The last date of publication of notification under Section 4(i) of the Land Acquisition Act was on 24.10.2003. The Land Acquisition Officer awarded market value of the property, classifying into 10 distinct categories, based on the lie and nature of land. The categorisation was as follows:- Category No.I : Dry land having access from MLA road on the west. Category No.II : Dry land with access from 12 to 15 meters wide private tarred road Category No.III : Dry land with access from untarred private road. Category No.IV : Dry land without any access. Category No.V : Nilam with access from untarred way as well as from private way. Category No.VI : Wet land without access. Category No.VII : Land lying as thodu or lake with access from private way. L.A.A.1070/07 & connected cases 3 Category No.VIII : Wet land lying as thodu without way. Category No.IX : Wet land without way lying at a higher level. Category No.X : Private land lying as road The extent and category of properties covered under different appeals are tabulated below:- (1). LAA.1070/07& 93.40 Ares Category No.I C.O.No.61/07 (LAR.7/06) (2). LAA.1466/07 182.15 Ares Category No.III (LAR.167/05) (3). LAA.1829/07 59.90 Ares Category No.III (LAR.115/05) (4). LAA.585/08 152.80 Ares Category No.IV (LAR.124/05) (5). LAA.590/08 114.52 Ares Category No.III (LAR.202/05) (6). LAA.878/08 50.18 Ares Category No.III (LAR.208/05) (7). LAA.1006/08 68.39 Ares Category No.III (LAR.219/05) (8). LAA.1349/08 59.00 Ares Category No.III (LAR.220/05) (9). LAA.1394/08 68.45 Ares Category No.III (LAR.218/05) 3. Out of the 9 appeals, except L.A.A.No.585/08 (LAR.124/05) and L.A.A.No. 1070/07 along with C.O.No.61/07 (LAR.7/06), the remaining 7 appeals pertain to L.A.A.1070/07 & connected cases 4 Category No.III, as classified by the Land Acquisition Officer. Value fixed by the Land Acquisition Officer with respect to Category No.III is Rs.47,734/- per Are. The reference court on consideration of all relevant factors and evidence on record, re-fixed land value at Rs.81,700/- per Are. The reference court placed reliance on its own common judgment in LAR.No:63/05 and connected cases, dated 31.10.2006, which arose out of the very same acquisition and the vary same notification (hereinafter referred to as judgment in LAR.No.63/05). The judgment in LAR.No.63/05 is marked in all the 7 cases pertaining to Category No:III. While fixing land value of properties under Category No.III, in LAR.No.63/05, the reference court reduced 10% value for areas through which an overhead Hi-Tension Electric Line (HT Line) is passing through. By adopting the very same method in these cases, the reference court reduced 10% for areas covered by the HT Line, fixing land value for such areas as Rs.73,530/- per Are. 4. With respect to properties under Category No.III, value of which is fixed by the reference court as stated above, the State Government as well as KINFRA, had raised serious contentions alleging that the enhancement granted is L.A.A.1070/07 & connected cases 5 excessive. But the respondents in those appeals have brought to our notice a judgment of this court in LAA.310/07 and connected cases, dt.17.7.2008. Those appeals arises out of LAR.No:63/05 and other similar cases covered by the very same Section 4(i) notification. A Division Bench of this court upheld the enhancement of land value granted by the reference court, with respect to properties under Category Nos.I to IV. In the said judgment this court found that the enhancement of land value for Category No.III is 71.15% only and that the market value fixed by the reference court is only just and proper. Repelling all contentions raised by the State Government and KINFRA this court observed that there is no sufficient grounds to arrive at a divergent conclusion or to take a contrary view than from the findings of the reference court. 5. As observed above, with respect to Category No.III the rate of enhancement granted by the reference court stands already confirmed and therefore we are not inclined to consider contentions of the appellants on merits. But the appellants had raised a further contention that the reference court went wrong in fixing equal land value both for small plots and larger plots. Relying on various decisions L.A.A.1070/07 & connected cases 6 of the Hon'ble Supreme Court it was contended that 10% has to be deducted in the case of larger plots towards development charges, and that the value of land in the case of bigger plots has to be reduced considering its extent when compared to smaller plots. Such contentions are resisted by counsel for the respondents on the basis that all the properties were lying fully developed and there is no justification in effecting any deduction on the ground that the properties in question are contained in larger plots. In this regard we notice observations contained in paragraph 10 & 11 of the judgment in LAA.310/07 and connected cases, which is extracted below:- “10). Learned counsel further contended that the reference court went wrong in fixing the land value equally for small plots and larger plots. The appellants relied on the decision of the Supreme Court reported in Atma Singh (Dead) through Lrs. & Others v. State of Haryana & Another, 2008(2) SCC 568 and pointed out that 10% has to be deducted in the case of larger plots towards development charges. The claimants contended that all the properties were fully developed with electric and water connection and, therefore, there is no justification in making any deduction in the compensation fixed for larger plots. 11). We have mentioned in the preceding L.A.A.1070/07 & connected cases 7 paragraphs that in majority of the cases, the extent of land acquired is between 2 and 5 Ares and in few cases, the extent is between 5 and 20 Ares. Hence the contention raised by the learned counsel for the appellants is not applicable as far as these appeals are concerned.” 6. Sri.Basant Balaji, learned Senior Government Pleader appearing on behalf of the State Government and Sri.G.S. Reghunath, learned counsel for KINFRA have vehemently argued that in all the appeals disposed of by the common judgment in L.A.A.No.310/07 and connected cases, the extent of land was between 5 to 20 Ares, whereas the extent with respect to all these 7 appeals coming under Category No.III, the extent is more than 50 Ares. Therefore it is contended that the property covered under these appeals cannot be treated as small plots. Hence arguments were advanced based on various decisions of the Hon'ble Supreme Court, to effect deductions considering the larger extent of the plots. We are of the opinion that the question needs consideration. We will proceed to discuss the issue after dealing with the contentions in the other two appeals. 7. In the appeals filed by KINFRA, LAA No:1466/2007 (LAR No:167/05) comes under category No:III and in LAA No:585/2008 (LAR No:124/05) which comes L.A.A.1070/07 & connected cases 8 under category No:IV. The respective counsel appearing for the respondents/claimants have contended that findings of the reference court regarding fixation of category was not correct and proper. Based on various factual evidences they argued that the respective properties ought to have been considered as land having access from the MLA Road, and hence ought to have been included in category No:I. The reference court has not appreciated the evidence on record adduced in this regard in its proper perspective, is the contention. But we notice that since there are no appeals or cross-objections filed by the claimants in both these cases, we need not look into those aspects. 8. The appellants in the above two appeals, viz: KINFRA, had also raised contentions to the effect that categorisation in these cases by the land acquisition officer was wrong. It was contended that the land in question were uncultivated wet land and it was only partly reclaimed. Even such partial reclamations are made without getting permission under the provisions of the Kerala Land Utilization Order, and hence such reclamation could not be countenanced for including the land in category of dry lands, is the contention. But in LAA No. 1446/2009 (LAR 167/2005) L.A.A.1070/07 & connected cases 9 the reference court had categorically found that there is evidence to the effect that the acquired property contain more than 100 coconut trees and more than 500 'Manchiyam' trees. So it could not be considered as a water logged land or wet land. Considering evidence of RW2 & RW3 and report of the Advocate Commissioner, the reference court had found that the property is situated in a prominent locality and it is having close proximity and access to the MLA Road. Therefore, categorization of the property under No.III was found to be correct and justifiable. 9. In LAA No:585/08 (LAR 124/2005) the reference court had included the land under category No.IV, finding that the land in question is having no access to the Panchayat Road. All the evidence brought on record from the side of claimants to establish that there exist a Panchayat Road, abutting the remaining properties of claimants, were discarded as not conclusive proof. It is further found that the claimants are not having any right to use the road developed by a private business entrepreneur, 'M/s.Halifax Developers'. Therefore the property is treated as dry land without any access, under category IV. The contentions raised in the memorandum of appeal is that, the property involved is L.A.A.1070/07 & connected cases 10 uncultivated wet land with water logged marshy areas. But it is noticed that no such contention was seen raised with any cogent supporting evidence, before the reference court. Further, from the description of property enumerated in the Mahazar prepared by the LA Officer, which is part of the 'Notes to Award', there is no such description and the property is described as reclaimed dry land with 112 coconut trees, 17 arecanut trees and one poola tree. Under the above circumstances, going by evidence on record, we find no materials to substantiate contentions of the appellant regarding categorisation in LAA No:1466/2007 and LAA No:585/08. Hence such contentions can only be repelled. 10. With respect to the land value fixed by the reference court in LAA No:585/08 (LAR No:124/05), we notice that the value in Ext.B2 & B3 documents were not accepted by the reference court as basis for fixation of land value, because properties covered under those documents are sale of developed small plots by M/s.Halifax Developers. The reference court noticed that the LA Officer had arrived at the value by reducing 30% of the rate contained in the basis document, Sale Deed No:700/02, for the reason that the property covered under the said document is a dry land L.A.A.1070/07 & connected cases 11 whereas the acquired property is only reclaimed wet land. But on an elaborate comparison between nature of the lands and prominence of the locations, the court below found that the acquired property is more important. So also it is found that the basic document is executed on 11.4.2002, whereas the acquisition in question is on 24.10.2003. Under such circumstances, by adopting increase at 23% from the value of the basic document and by reducing 10% towards difference with respect to nature of the land, the reference court fixed the price at Rs.70,000/- per Are. In our considered opinion, we do not find anything unjustifiable in the value arrived at by the court below, subject to contentions of the appellant regarding reduction for largeness of the property. 11. As far as LAA.1070/07 & C.O:61/07 (LAR.7/2006) the property is coming under category No:I. The property is having entrance from MLA Road as well as from a 15 Mt: wide tarred road on the northern side. Ext.R4 Mahazar revealed that there were 61 coconut trees, 45 Accasia trees, 24 Mango trees, 34 Manchiyam trees, 6 cashew trees, 34 Arecanut trees, 13 Anjili trees, etc:. The Mahazar further revealed that out of the total extent of 93.40 Ares certain areas are pucca dry land and remaining are reclaimed wet L.A.A.1070/07 & connected cases 12 land. Motor shed, compound wall, 2 Gates, well etc: were also noticed in the property. It has also come out in evidence that the property was having 50 Mtrs: frontage to the 50 Mt: wide tarred road on the northern side. Regarding valuation of the land, the reference court found that Ext.R2 Sale Deed upon which KINFRA had placed much reliance, could not be accepted as basis, because there is no similarity between the properties. Ext.A2 is the Judgment in LAR.63/05 in that case. The court below found that the property in LAR.63/05 is not having any frontage to the MLA Road, whereas the acquired land is having frontage to the MLA Road as well as frontage of the 15 Mt: wide tarred road. Further, the distance from the main gate of properties of 'Halifax Developers' to the property in LAR.63/05 is 400 Mtrs:, whereas the distance to the acquired land is only 50 Mtrs:. The reference court found that the property in LAR.63/05 is coming under category II and III, whereas the acquired property is coming under category I, having frontage to MLA Road. It is also found that prominence of locality in the case of acquired land is much better than the property covered under the Judgment in LAR.63/05. Considering all these aspects, the reference court fixed 10% increase from the rate awarded in L.A.A.1070/07 & connected cases 13 LAR.63/05 for the extent of 2.95 Ares out of the total extent, which is pucca dry land, and 8% increase for the remaining area of 90.45 Ares which is reclaimed wet land. The reference court declined the claim for enhancement of the value of structures and improvements, since no evidence was adduced in support of such claim. The appellant (KINFRA) had raised various contentions to assail fixation of land value based on the rates awarded in LAR.63/05. In the memorandum of appeal they have raised a contention that the Judgment in LAR.63/05 is pending in appeal in LAA.310/07. But as stated in the foregoing paragraphs, we notice that LAA.310/07 has already been disposed of approving the rates in LAR.63/05. It is further contended that the extent covered under the present case is a large chunk of land whereas the property in LAR.63/05 are small housing plots. On a total re-appreciation of the entire evidence on record we do not find any cogent reason to interfere with the enhancement of land value granted by the reference court in this case, except in the matter of contentions regarding largeness of the acquired land, which contentions we will deal with separately in the later part of this Judgment. L.A.A.1070/07 & connected cases 14 12. In the cross-objections, C.O.No:61/07, the respondents/claimants in LAA.1070/07 (LAR.7/06) is seeking enhancement at the rate of Rs.1,02,000/- per Are for pucca dry land and Rs.1,00,000/- per Are for reclaimed wet land, as against Rs.94,000/- and Rs.92,880/- respectively, granted by the reference court. It is pointed out that with respect to certain other lands notified for the very same purpose of acquisition, the Government had authorised the District Collector for initiating 'Fast Track Acquisition' and through conciliations the value of Rs.80,584/- per cent was given for properties having frontage to private roads and value of Rs.84,268/- per cent was given to properties having frontage to tarred road. Certified copies of the Sale Deeds of such purchases were produced as Annexures A3(a) to A3(c), along with I.A.No:5152/08, filed seeking acceptance of those documents as additional evidence. But we notice that those Sale Deeds are of the year 2007, whereas the notification under Section 4(i) with respect to acquisition herein is dated 24.10.2003. It is settled law by this time that post- notification documents could not be considered and accepted as basis for fixation of land value. Apart from the above said documents, the cross-objector was not successful in proving L.A.A.1070/07 & connected cases 15 through any cogent materials that the land value fixed by the reference court is inadequate and unjustifiable. Hence we do not find merits in the cross-objection. 13. The main thrust of arguments advanced by Sri.G.S. Raghunath, learned counsel appearing for KINFRA, as well as Sri.Basant Balaji, learned Senior Government Pleader appearing for the State/Appellant, is that the extent of the properties involved in these appeals are large, when compared to properties covered by the relied on Judgment and Sale Deeds. On the factual matrix we are convinced that the extent covered in all these 9 appeals are larger areas when compared with the extents of properties covered by Judgment in LAR.63/05 and Sale Deed No:700/02, which is taken as basis document in LAA No:585/08. As we already noticed, in the Judgment in LAA 310/07 and connected cases, while upholding enhancement granted by the reference court, the learned Judges observed that the extent of land covered in majority of the cases dealt with therein is between 2 to 5 Ares and in few cases it is between 5 to 20 Ares. Hence the contentions in this regard was not considered in those cases. Whereas, in the appeals at hand the extent of land is ranging from 50.18 Ares upto 182.15 Ares. Therefore L.A.A.1070/07 & connected cases 16 we are of the opinion that the extent of land covered by these appeals are not smaller plots, but properties having large extents. 14. Sri.G.S. Raghunath had placed for our consideration various decisions of the Hon'ble Supreme Court in support of the above contentions. In the case of Special Deputy Collector and another Vs. Kurra Sambasiva Rao & others (AIR 1997 SC 2625) and Land Acquisition Officer and Sub-Collector Vs. Smt: Sreelatha Bhoopal and another (AIR 1997 SC 2552) the Hon'ble Supreme Court held that the method of relying on price of small plots in order to fix value of large extents is not proper. In Shimla Development Authority & others Vs. Santhosh Sharma & another (AIR 1997 SC 1791) the apex court had approved deduction of 40% towards development charges. Cases reported in AIR 1997 SC 1906 and 1995 Supp(2) SCC 168 were also cited to canvass the proposition that sale price of small extent of land should not ordinarily be taken as basis for determination of market value of large extent of land. In State of J & K Vs. Mohammad Mateen Wani & Others (AIR 1998 SC 2470) it is held that when big chunk of land is acquired instances of L.A.A.1070/07 & connected cases 17 sale of small parcels of land cannot be comparable. Decision of Bhim Singh & others Vs. State of Haryana & another ((2003) 10 SCC 529) was also relied on to emphasise the above legal proposition. 15. A latest decision of the Hon'ble Supreme Court on the point is Atma Singh (dead) through LRs and others Vs. State of Haryana and another ((2008) 2 SCC 568). It is held therein that the principle that price fetched for small plots cannot form safe basis for valuation of large tracts of land, is because substantial area has to be used for development of sites like, laying out roads, drains, sewers, water and electricity lines and other civic amenities. In order to make up cost for the area of land which is used in providing civic amenities, the waiting period during which capital of the entrepreneur gets locked up has to be considered and a deduction depending upon the facts of each case, is to be made. Once plots are carved out after acquisition of land and are sold to public, there is no scope for earning any money in future. Therefore the development charges incurred for such works need be deducted. But in the very same decision it is stated that the purpose for which the acquisition has been made shall also to be taken note of. L.A.A.1070/07 & connected cases 18 If such purpose is for usage of vast extent of land as such, without making any developments, deduction towards development charges is not desirable, is the dictum. 16. On the contrary Sri.K.C. Charles, one among the counsel appearing for the respondents/claimants had pointed out the decision in Bhagwathula Samanna and others Vs. Special Tahsildar and Land Acquisition Officer ((1991) 4 SCC 506) wherein it is held that, in applying the principle of deduction taking into consideration of expenses required for development of larger tracts to make smaller plots, it is necessary to consider all relevant facts. It is not the extent of the area covered under the acquisition which is the only relevant factor. If smaller area within which the tract is already developed and situated in advantageous position suitable for building purpose and have all amenities such as roads, drainage, electricity, etc., then the principle of deduction simply for the reason that it is part of the large tract, may not be justified. Relying on the above dictum it is argued that eventhough the land covered under these appeals are larger in extent, they were situated in fully developed stage, provided with roads, compound walls, foundation of boundary walls, and with such other common L.A.A.1070/07 & connected cases 19 amenities. Therefore no further expenses will be incurred towards development charges, is the contention. In the decision of Atma Singh's case (cited supra) the Hon'ble Supreme Court has taken note of the principles laid down in Bhagwathula Samanna's case (cited supra). 17. Sri. V.K. Isac, learned counsel appearing for respondents/claimants in LAA.1466/07 contended that the property acquired under the said case is having all civic amenities with land of even level, having all locational advantages of social amenities. It is argued that the purpose of acquisition is to lease out the land for export promotion industries and each units which will be set up in the acquired land may require large extents of land.