1 IN THE HIGH COURT OF BOMBAY AT GOA FIRST APPEAL NO.298 OF 2004 1. Smt. Maria Aurea Margarida Cristalina D'Souza Pinto 2(a) Judy Godinho (b) Augusto Brian Charles Pinto, both R/o Pearl Croft, Turner Road, Bombay. 3(a) Maria Silvia Adelaide Pinto Dias (b) Reginald Alex Dias both R/o Kesarkar Housing Society, Aquem, Margao, Goa. 4(a) Basil Edwin Martin Pinto (b) Maria Angelica Lolita Fernandes Pinto both R/o. 127, Porvorim, Bardez, Goa. 5(a) Cyril Allan Socorro Pinto (b) Claris Lopes Pinto, both R/o. T-1, Kamat Estate, Tonca, Caranzalem. 6. Julio Leslie Melvyn Pinto, R/o. Porvorim, Bardez, Goa. All represented through their Power of Attorney Shri Hari N. Falari, C/o. Falary Constructions, Mapusa, Goa. …. Appellants V/s 1. Additional Deputy Collector, Land Acquisition Officer, Mapusa Sub-division, Mapusa. 2. The Executive Engineer, 2 Works Division VII, Public Works Division, Panaji, Goa. Mr. A.R. Kantak, Advocate for the Appellants. Ms. Susan Linhares, Additional Government Advocate for the Respondents. CORAM : F.M. REIS, J. DATE : 14th JANUARY, 2011 JUDGMENT: The above appeal challenges the judgment and award dated 4/09/2004 passed by the learned Additional District Judge at Mapusa in Land Acquisition Case No.200/1998. 2. By a notification issued under Section 4 of the Land Acquisition Act, 1894, hereinafter referred to as "the said Act", dated 13/03/1992, the respondents intended to acquire an area of 812 square metres from the property bearing survey no.25/8 and survey no.25/10 of the Village of Socorro, Bardez Taluka, for the purpose of the widening and improvement of National Highway - 17. 3. By an award passed under Section 11 of the said Act, dated 12/04/1995, the Land Acquisition Officer offered compensation at the rate of Rs.100/- per square metre. Being dissatisfied with the 3 said amount, the appellants sought a reference under Section 18 of the said Act for enhancement of compensation and claimed a sum of Rs.1,500/- per square metre for the land acquired. By judgment and award dated 4/09/2004, the Reference Court has fixed the compensation at the rate of Rs.112.50 per square metre, besides statutory benefits. 4. Being aggrieved by the said judgment, the appellants have filed the present appeal. Shri A.R. Kantak, learned Counsel appearing for the appellants has assailed the impugned judgment and submitted that there is ample evidence on record to come to the conclusion that the appellants are entitled for a compensation at much higher rate than the one awarded by the Reference Court. The learned Counsel further submitted that the land acquired is adjoining the main highway and had high potentiality of being used for non-agricultural purpose as the same is located near the Porvorim village which is in the outskirts of the capital city of Panaji. Learned Counsel further submitted that in the vicinity of the acquired land there were residential buildings which had come up and, as such, there was high demand to the land acquired for non-agricultural purpose. Learned Counsel further pointed out that the Reference Court has totally mis directed itself in coming to the 4 conclusion that the area of 300 square metres was coming within the set back area and the same was totally useless. Learned Counsel further took me through the evidence on record and pointed out that the conclusions drawn by the Reference Court are totally erroneous and the same cannot be sustained. The learned Counsel has taken me through the evidence of AW3/Sundeep Falari and pointed out that the reference made therein to a set back area of 300 square metres was in respect of the unacquired portion of the land, in case the same was developed. Learned Counsel has further pointed out that the land acquired had a frontage to the main road, Mapusa-Panaji and considering the sale deed at Exhibit 10 produced by the appellants which is dated 7/05/1991 wherein a plot of 300 square metres was sold at the rate of Rs.277/- per square metre, the amount awarded by the Reference Court is illusory. Learned Counsel has further submitted that the sale deed plot was a developed plot, but was not adjoining the highway but adjoining an internal road and, as such, the acquired land had much better value than the sale deed plot. Learned Counsel further submitted that the Reference Court has not at all considered the well settled principles of law in determining the compensation under Section 23 of the said Act and, as such, the amount of compensation payable to the appellants deserves to be enhanced to a minimum rate of Rs.500/- 5 per square metre. The learned Counsel further pointed out that there was an agreement for sale dated 21/04/1995 in respect of the acquired land which can form the basis for determining the market value of the acquired land. 5. On the other hand, Ms. Susan Linhares, the Additional Government Advocate appearing for the respondents has supported the impugned judgment and pointed out that the land acquired was coming within the road widening area and was subject to statutory restrictions and, as such, the same has no potential value, and could not be used for any other purpose. Learned Additional Government Advocate further submitted that the Reference Court has rightly appreciated the evidence on record and has come to the conclusion that the market value of the acquired land is to be fixed at Rs.112.50 per square metre. Learned Additional Government Advocate, as such, submitted that there is no infirmity committed by the Reference Court as the Appellants failed to establish that the amount offered by the Land Acquisition Officer was inadequate, and, as such, appeal deserves to be dismissed. 6. Having heard the learned Counsel and on perusal of the records, the following point for determination arises in the present 6 appeal: POINT FOR DETERMINATION (i) Whether the Reference Court was justified to fix the market value of the acquired land at the rate of Rs.112.50 per square metre. 7. In support of their claim for enhancement, the appellants have examined as AW1/Hari Nilkant Falari, who is a power of attorney of the appellants. The said witness has referred to Agreement dated 21/04/1995 between AW1 and the owner. He has stated that as per the said agreement, an area of 4195 square metres was agreed to be developed, out of which 812 square metres was intended to be acquired by the Government. He has further stated that price fixed in the said agreement was at the rate of Rs.1,050/- per square metre. He has further stated that the land proposed to be developed was located in the settlement area and it had amenities such as school, post office, church, temple, etc. within the radius of 150 metres from the acquired land. In the cross-examination he has admitted that the notification issued under Section 4 was published on 15/05/1991 in the daily Navhind Times. He has further stated that the award was made on 12/04/1995. To a pointed question as to whether he was aware of the fact that the part of the land was proposed to be acquired, when the agreement 7 was executed on 21/04/1995, the said witness stated that he was under impression that the land was not going to be acquired. He further stated that he was not aware that the whole area was coming within the set back area. He has further admitted that it was mentioned in the agreement that part of the land was acquired. In his further cross-examination he has stated that only first phase of agreement was completed and that only two flats were given towards the consideration and that one flat was given about a year back when the deposition was recorded on 21/06/2004. The next witness examined is AW2/Cyril Allan Pinto, who has stated that the appellant no.1 is the mother and the appellant no.2 is his sister and that the acquired land is situated at Porvorim at a distance of about 50 metres from Damian De Goa, adjoining the National Highway. He has further stated that the acquired land is terrace land. In support of his claim for enhancement, he produced the sale deed dated 7/05/1991 which is at Exhibit 10, wherein the price at which the said land was sold was Rs.277/- per square metre and an area involved was 397 square metres. He has further stated that the said sale deed plot is located in the same village and is at a distance of about 800 metres from the acquired land and at a distance of about 300 metres away from the National Highway. The said sale deed plot was rocky land and was situated in the hilly area, but was 8 accessible by tar road, but however, telephone lines were not passing through the said sale deed plot. He further stated that the acquired land was more advantageously located. He has also produced sale deed dated 26/10/1994 which is at Exhibit 11 where the land was sold at the rate of Rs.800/- per square metre. He has also produced agreement dated 21/04/1995 which is at Exhibit 16. In the cross-examination he has admitted that the agreement was in respect of the entire property. He has admitted that the builder has not given the possession of the four bungalows and two flats as per the said agreement. The possession of the entire land including the land which is proposed to be acquired is with the builder. He has further admitted that the sale deed plot can be used for construction purposes. He has further stated that he was not aware of the sale deed Exhibit 11 which was a subdivided plot. The next witness examined is AW3/Sundeep Falari, who is a practicing Architect, who has stated that the land acquired is situated in the settlement zone and is well developed locality. In the cross-examination, he admitted that he is not a registered valuer and that he had inspected the property in August 1995. The next witness examined is AW4/Tiago Costa, who has purchased an area of 397 square metres pursuant to the sale deed dated 7/05/1991 for a consideration of Rs.277/- per square metre. He has stated that the 9 said plot is located at Arrarim, Socorro, on the internal road and about 300 metres from the highway Mapusa ot Panaji and about 800 metres from the plot of Allan Pinto and others. He has further stated that the acquired land had water, telephone and electricity facilities. In the cross-examination, he had admitted that the plot purchased by him was a developed plot having all necessary permissions from the concerned department. 8. The Reference Court has discarded the sale deed at Exhibit 11 being the post notification sale deed and relied upon the sale instance dated 7/05/1991 at Exhibit 10 to form the basis of the acquired land. The Reference Court has deducted 40% on account of development charges and found that the compensation works out to Rs.166.20. The Reference Court has further considered that AW3 had stated that 300 square metres were coming within the set back area and has given compensation only for an area of 512 square metres after deducting the said area of 300 square metres. The Reference Court has found the land acquired being superior to the sale deed plot and has increased the value by 5% and consequently fixed the compensation at the rate of Rs.112/- per square metre for a total area of the land acquired. 10 9. Dealing with the contention of the learned Counsel appearing for the appellants with regard to the agreement dated 21/04/1995 produced, which is at Exhibit 16, I find that no reliance can be placed upon the said agreement. Admittedly, said agreement has been executed after Section 4 notification was issued and process of acquisition was already in place. In such circumstances the agreement might have been executed at a higher price. The genuineness of such agreement would be in doubt for the purpose of fixing the market value of the acquired land. Apart from that, consideration to be paid for the said agreement was substantially in kind and AW1 himself has admitted that possession of one of the flats was given only in the year 2003. Considering the facts and circumstances of the case, I find that the question of relying upon the said agreement for the purpose of fixing the market value of the acquired land cannot be accepted, as in any event it cannot be treated as a sale instance but merely an agreement upon some terms and conditions, genuineness of such transaction executed after Section 4 notification cannot be accepted to form the basis to fix the market value of the land. 10. With regard to the sale deed at Exhibit 11, the same cannot be considered as it is a post notification sale deed and when sale 11 instance prior to Section 4 notification is available, there is no necessity for relying upon any post notification sale deed for fixing the market vale of the acquired land. As such, the only sale deed which can be relied upon for the purpose of fixing the market value of the acquired land is sale instance at Exhibit 10 which is dated 7/03/1991. 11. Shri Kantak, learned Counsel appearing for the appellants was right to contend that the Reference Court was not justified to refuse any enhancement of compensation to an area of 300 square metres from the acquired land on the ground that it came within the set back area. On perusal of the evidence of AW3, I find that there is nothing stated therein to the effect that 300 square metres from the acquired land was coming within the set back area. The reference to 300 square metres was with regard to the future development of the remaining portion of the land which had nothing to do with the portion of the land acquired. The Reference Court totally misdirected itself in making such bifurcation of the land while fixing the market value of the acquired land. No doubt on account of any such statutory restrictions, a deduction can be effected on such count, but under no circumstances can it be said that the owner is not entitled for any compensation for such portion 12 of the land acquired. 12. On perusal of the records, I find that the land which was acquired was for the widening of the existing highway from Mapusa to Panaji. AW3/Sundeep Falari, in his deposition has stated that frontage of the land of the appellants is 40 metres and, as such, the width ought to have been about 25 metres. Considering the location of the land acquired, there can be no doubt that a portion of the said area was coming within the road widening area. The Apex Court in the judgment in the case of State of Goa & Anr. V/s. Gopal Baburao Gaudo & Ors. in Special Leave Petition No.10598/2009 reported in 2009 (10) SCC 686 has held at paras 4 and 5 thus: “4. A long strip of land measuring more than two- third of an acre lying alongside and adjoining the Highway cannot be treated as a land without value or without any potential for development, merely on the ground that the law relating to Highways prohibited construction on either side of the Highway, upto a depth of 40 meters from the centre of the Highway. All that was required to create or realize potential of such land was to annex or merge the said strip of land with the land to its rear. In that event, the strip of land will become the `access' to the rear-side land from the main road and will also become the frontage of the aggregate land, thereby enhancing the potential and value of the rear-side land, as also creating a potential for its own use. The contention that a land adjoining the Highway should be treated as having no development potential (and therefore as land without 13 much value except as ordinary agricultural land), while considering the lands to its rear which are farther away from the road, or other adjoining lands of the same extent, but having more depth (so as to extend beyond the 40 meters margin) as having potential for development, is illogical and cannot be accepted. 5. We may demonstrate the absurdity of such a contention with reference to an illustration. Let us take the example of a residential plot of land measuring 60' X 100'. Let us assume that the Municipal Bye-laws require a front (road side) set-back of 20' for construction of houses in a plot of that size. Therefore, the owner would leave a twenty feet wide front strip in the said plot free of any construction while putting up the construction in the plot. Obviously, he cannot thereafter construct in that front strip. Let us further assume that the front strip is acquired for road widening. Can the acquiring authority deny compensation to that strip on the ground that the said 20' strip acquired for road widening could not in any event be used for any construction purpose and therefore, was not of any value? Obviously not. 13. Considering the said judgment of the Apex Court, merely because the land is coming within road widening area it cannot be considered to be of no value to the appellants. 14. The Apex Court in the judgment reported in 2009 (9) SCC 289 in the case of Attar Singh & Anr. V/s. Union of India & Anr. has held at paras 7,8 & 9 thus: 7. It is now a well-settled principle of law that determination of the market value of the land acquired indisputably would depend upon a large 14 number of factors including the nature and quality thereof. The norms which are required to be applied for determination of the market value of the agricultural land and homestead land are different. In given cases location of land and in particular, closeness thereof from any road or highway would play an important role for determination of the market value where for belting system may in appropriate cases may be resorted to. The position of the land, particularly in rainy season, existence of any building, etc. also plays an important role. A host of other factors including development in and around the acquired land and/or the potentiality of development will also have a bearing on determination of the fair market value of the land. 8. Determination of the market value of the land may also depend upon the facts and circumstances of each case, amongst them would be the amount of consideration mentioned in a deed of sale executed in respect of similarly situated land near about the date of issuance of notification in terms of Section 4(1) of the Act; in the absence of any such exemplars, the market value can be determined on yield basis or in case of an orchard on the basis of number of fruit- bearing trees. 9. It is also well settled that for the purpose of determination of price of acquired land, the courts would be well advised to consider the positive and negative factors, as has been laid down by this Court in Viluben Jhalejar Contractor v. State of Gujarat1 i.e.: (SCC 797, para 20) “Positive factors Negative factors (i) smallness of size (i) largeness of area (ii) proximity to a road (ii) situation in the interior at a distance from the road (iii) frontage on a road (iii) narrow strip of land with very small frontage compared to depth (iv) nearness to developed area (iv) lower level requiring the depressed portion to be filled up (v) regular shape (v) remoteness from 15 developed locality (vi) level vis-à-vis land (vi) some special under acquisition disadvantageous factors which would deter a purchaser (vii) special value for an owner of an adjoining property to whom it may have some very special advantage.” 15. Keeping in mind the said principles well settled by the Apex Court, I shall proceed to determine the market value of the acquired land on the basis of the sale deed at Exhibit 10. On perusal of the said sale instance, I find that the sale deed plot was sold at the rate of Rs.277/- per square metre pursuant to sale deed dated 7/05/1991. AW4/Tiago Costa has stated that the sale deed plot is at a distance of about 300 metres from the highway and about 800 metres from the land acquired. The evidence further discloses that the sale deed plot though is located in the vicinity of the acquired land, nevertheless it is adjoining the internal road. The sale deed plot is also a developed plot and considering that the land acquired was undeveloped land, a deduction on such factor would have to be made. Besides, other factors as stated herein would have to be considered for the purpose of fixing the market value of the acquired land. The acquired land is adjoining the highway and had a large frontage. It is well settled that the land which is located adjoining the highway would have much high 16 potentiality than the land which is located in the interior adjoining the interior road. Land adjoining the highway would have more commercial value. Considering the said factors, even the Reference Court while passing the impugned judgment has come to the conclusion that the land acquired was superior to the land which was subject matter of the said sale instance. But however, the Reference Court has failed to consider that the evidence on record discloses that the land acquired was in the vicinity of the developed area and, as such, had higher demand for land vis-a-vis the sale deed plot. On account of such factors, I find that the land acquired would have an appreciation of 25%, considering that it already had infrastructure facilities and was adjoining the national Highway. As the sale deed plot was at the rate of Rs.277/- per square metre, considering the said appreciation, the amount works out to Rs.347/- per square metre. There is a gap of one year between the date of the sale deed and the notification issued under Section 4 in the present case. The escalation on such count would be 10% and the amount works out to Rs.380/- per square metre approximately. As far as demerits of the land are concerned, the main one is that the land acquired is coming within the road widening area. Apart from that, the sale deed plot at Exhibit 10 is a developed plot and consequently there would be deductions on 17 account of the development charges. There is no dispute that besides the land acquired, the appellants were owning more land beyond the acquired land. As such, the appellants would be entitled to take the advantage of the FAR while developing the remaining portion of the land. Considering all these factors on account of the fact that the land was coming within the road widening area, the deduction of 25% would have to be effected. Apart from that a further 25% would have to be deducted on account of the fact that the sale deed plot was a developed plot having all statutory benefits. After deduction of 50% on account of the said demerits from the said amount of Rs.380/-, the amount works out to Rs.190/- per square metre approximately. The point for determination is answered accordingly. 16. The impugned award, as such, deserves to be modified to that extent. The said amount of compensation would have to be awarded for the total area of the land acquired. In view of the above, I pass the following order: O R D E R (i) The appeal is partly allowed. (ii) The impugned judgment and award of the Reference Court is modified and the compensation for the land acquired admeasuring 812 square metres is 18 fixed at Rs.190/- per square meter. (iii) Needless to say, the remaining part of the award granting statutory benefits is confirmed. (iv) The appeal stands disposed of accordingly with no orders as to costs.