RFA No. 159 of 1996 [1] In the High Court of Punjab & Haryana at Chandigarh Date of decision: April 22 ,2009 1. R.F.A. No. 159 of 1996 (O&M) Praveer Enterprises Pvt. Ltd. .. Appellant v. State of Punjab .. Respondent 2. R.F.A. No. 158 of 1996 (O&M) Mrs. Naginder Kaur ` .. Appellant v. State of Punjab .. Respondents 3. R.F.A. No. 926 of 1996 (O&M) Kehar Singh (deceased) through LRs and others .. Appellants v. State of Punjab .. Respondent 4. R.F.A. No. 927 of 1996 (O&M) Atma Singh (deceased) through LRs and others .. Appellants v. State of Punjab .. Respondent 5. R.F.A. No. 928 of 1996 (O&M) Inder Singh (deceased) through LRs and others .. Appellants v. The State of Punjab .. Respondent 6. R.F.A. No. 929 of 1996 (O&M) Chittar Singh and others .. Appellants v. State of Punjab .. Respondent RFA No. 159 of 1996 [2] 7. R.F.A. No. 1437 of 1996 (O&M) M/s R.T.S. Electronics Private Ltd. .. Appellant v. The State of Punjab .. Respondent Coram: Hon'ble Mr. Justice Rajesh Bindal Present: S/Shri Arihant Jain, Arun Jindal and Surinder Mohan Sharma, Advocates for the land owners. Mr. Vivek Chauhan, Assistant Advocate General, Punjab. .. Rajesh Bindal J. This order shall dispose of a bunch of 7 appeals, as the same arise out of a common acquisition. The land owners are in appeal against the award of the learned court below seeking further enhancement of compensation for the acquired land. The facts have been extracted from R. F. A. No. 159 of 1996. Briefly, the facts are that land measuring 10.36 acres situated in the revenue estate of village Bhankarpur, was acquired vide notification dated 26.8.1987 issued under Section 4 of the Land Acquisition Act, 1894 (for short, `the Act') for setting up of industrial unit at village Bhankarpur. The Collector vide award dated 18.12.1989, divided the acquired land into special belt and remaining land and assessed the market value @ Rs. 75,040/- and Rs. 60,000/- per acre. Aggrieved against the same, the land owners filed objections which were referred to the learned court below, who keeping in view the material placed on record by the parties, determined the fair value of the acquired land @ Rs. 1,00,000/- per acre. Learned counsel for the land owners submitted that the learned court below has failed to appreciate the evidence led by them on record, which clearly justified that value of the acquired land, as has been assessed by the learned court below, is not in consonance with the material placed on record. The strategic location of the land has been totally ignored. It is located on Ambala-Kalka National Highway. It was acquired for the purpose of setting up of industrial unit. The acquisition was merely for 10.36 acres of land. It was already surrounded by RFA No. 159 of 1996 [3] other industrial units. Even the Industrial Focal Point was also located quite close to it. The patent illegality committed by the learned court below is in ignoring sale deed (Ex. A4), which was forming part of the acquired land. It was registered 11 months prior to the acquisition. The same was purchased by the land owners for the purpose of setting of an industrial unit and in fact effective steps for setting up of the unit had been taken and the process of construction had also started. Reference was also made to sale deeds (Ex. A5 and Ex. A6), which were also pertaining to the land in the vicinity. The observation by the learned court below that the sale deed was registered just with a view to jack up prices having come to know about the acquisition is totally without any basis. Had that been so, the land owner therein would not have applied for a loan for setting up of industrial unit and completed all other formalities prior to even acquisition of land and further had not started raising construction also. In fact, the land owner therein had not only suffered loss on account of acquisition of land but even his business plans have also been shattered for which he deserves to be compensated. As far as sanction of loan, completion of various formalities and raising of construction on the land is concerned, reference was made to oral and documentary evidence produced on record by the land owner in RFA No. 159 of 1996 to claim compensation for construction existing on site and also business loss. On the other hand, learned counsel for the State submitted that whatever assessment had been made by the learned court below was much more than what the land owners deserved. In fact, considering the finding recorded, it was a case of no evidence and the land owners were not even entitled to enhancement, as has already been ordered by the learned court below. If sale deeds (Ex. A4 to Ex. A6) are ignored, there is no evidence to justify any further increase. He further submitted that there is a categoric finding by the learned court below to the effect that sale deeds (Ex. A4 and Ex. A5) were got registered after coming to know about the acquisition proceedings showing exhorbitant prices. Sale deed (Ex. A6) cannot be considered at all as the same was registered much after the acquisition. It has come on record that at the time of acquisition, the land was being put to agricultural use. It was not being used for any industrial purpose. In the vicinity also, there was no such pressure on the land on the basis of which the land owners could claim that it had great potential. As regards construction, learned counsel for the State submitted that report, as has been presented by the land owner, does not inspire confidence as it is not providing requisite details. The RFA No. 159 of 1996 [4] expert, who had prepared the report, had not properly examined the site. He was not involved in day to day construction process to know exactly how the small portion of building existing on the site was constructed and what material was used therein. In the absence thereof, the land owner therein is not entitled to any compensation whatsoever. As regards loss of business is concerned, the submission is that the business, if any, was yet to start and generate profits. In the absence thereof, merely on anticipation, no compensation can be paid to the claimant therein. Heard learned counsel for the parties and perused the relevant referred record. There are two issues, which require consideration by this Court in the present set of appeals, namely, the value of the land in question on the date of acquisition and entitlement of the land owner in RFA No. 159 of 1996 to any damages on account of construction existing on the site on the date of acquisition and also any damages for loss of business. As far as determination of fair value of the acquired land is concerned, there is no dispute that the land is located on main Ambala-Kalka National Highway. It is a chunk of 10.36 acres of land acquired for setting up of an industrial unit. It has come on record that there were certain other industrial units located in the vicinity and even Industrial Focal Point was merely at a distance of 4-5 killas therefrom, as was admitted by RW1-Basant Singh Patwari. It is also an admitted fact that on the part of the acquired land, construction for one industrial unit was in progress for which additional claim has been made in RFA No. 159 of 1996. Even the Collector had awarded compensation for the super structure existing thereon. Sale deed (Ex. A4) dated 25.9.1986, whereby 5 kanals of land was sold for a sum of Rs. 1,00,000/- was in fact purchased by the land owner in RFA No. 159 of 1996 for the purpose of setting up of an industrial unit and in fact, construction was being raised thereon. Keeping the aforesaid facts in view, in my opinion, the finding recorded by the learned court below that sale deed (Ex. A4) was got registered in anticipation to jack up the prices of the acquired land having come to know about the acquisition proceedings is totally perverse. It is not plain and simple purchase of land by any person just before the acquisition. The sale deed was registered 11 months prior to the acquisition. The land owner therein had taken effective steps for setting up of industrial unit by getting the loan sanction, which was partly disbursed and he had even started raising construction. In such a situation, it cannot possibly be held that the transaction shown in sale deed (Ex. A4) was a RFA No. 159 of 1996 [5] sham transaction. The land dealt with therein being 5 kanals and the same being part of the acquired land, which was merely 10.36 acres, in my opinion, that was the best piece of evidence which deserved consideration for the purpose of determination of fair value of the acquired land. Vide aforesaid sale deed, 5 kanals of land was sold for a sum of Rs. 1,00,000/-, the same comes out to Rs. 1,60,000/- per acre. In my opinion, no cut is required to be imposed as the transaction was not for a small piece of land. Rather, for the time gap in the acquisition, another sum of Rs. 10,000/- per acre deserves to be added therein. Accordingly, in my opinion, the value of the acquired land should be determined @ Rs. 1,70,000/- per acre. Ordered accordingly. As far as value of the super structure existing on the acquired land is concerned, though learned counsel for the land owner referred to the oral as well as documentary evidence produced on record to show substantial construction existing on the site, however, a perusal thereof and also the photographs produced in evidence do not show that in fact so much of construction was existing, as is sought to be claimed in the estimate produced. The Collector had awarded a sum of Rs. 2,44,700/- on account of super structure existing on the land. Without going into the details about the cost of construction and as to how much construction was existing on the site at the time of acquisition, in my opinion, considering the fact that the estimate, as is prepared by the State authorities, is always conservative as compared to the amount spent by a private entrepreneur. In my opinion, the land owner deserves some increase thereon which, as a guess work, should be at least 20% of the amount assessed by the Collector. Accordingly, another sum of Rs. 49,000/- shall be payable to the land owner in RFA No. 159 of 1996 on account of super structure existing on the site. As far as grant of compensation on account of damages suffered by the land owner in RFA No. 159 of 1996 is concerned, sufficient evidence has been led on record to show that the land owner had purchased the land with a view to set up the industrial unit. It had even applied for loan to Punjab Financial Corporation which was sanctioned vide letter dated 10.7.1987 (Ex. AW5/1) to the extent of Rs. 25,00,000/-. It is relevant to add here that the entrepreneur was also entitled to State subsidy of Rs. 5,00,000/- and special capital assistance of Rs. 2,00,000/- as is mentioned in the aforesaid sanction letter. The project was planned for manufacture of GRG Composite Boards. The acquisition of land was carried out vide notification dated 26.8.1987. Immediately after the issuance of notification under Section 4 of the Act, the entrepreneur was informed by Punjab Financial Corporation vide communication dated 31.8.1987 that in view of the RFA No. 159 of 1996 [6] development, the site where the project should be located deserves to be changed. Ultimately with the acquisition of land, the project could not come at the place where it was planned and even the construction had also started. This had certainly delayed the process of setting up of industrial unit by the entrepreneur for which it deserves to be compensated, as with the material on record, it cannot be said that the same was merely a wishful thinking, rather effective steps had been taken for setting up the project and at the time of acquisition, it was under implementation. As there cannot possibly be any direct or mathematical method for calculation of compensation on that account, guess work will have to be applied and in my opinion, a sum of Rs. 50,000/- would be appropriate compensation which the land owner in RFA No. 159 of 1996 is entitled to on account of loss of business. In view of the above, the land owners shall be entitled to compensation @ Rs. 1,70,000/- per acre for the acquired land. In RFA No. 159 of 1996, the land owner shall be entitled to Rs. 2,93,700/- as compensation for the super structure existing on the acquired land Rs. 50,000/- on account of loss of business. The land owners shall also be entitled to all statutory benefits available under the Act. The appeals are disposed of in the manner indicated above. (Rajesh Bindal) Judge April 22 ,2009 mk