1 IN THE HIGH COURT OF BOMBAY AT GOA FIRST APPEAL NO. 278 OF 2003 WITH CROSS OBJECTION The Managing Director, Goa IDC, Shree Saraswati Mandir Building 18th June Road, Panaji-Goa .. Appellant Versus (1) Shri Shrikant R. Bhatikar, Power of Attorney of late Shri Raia Porobo Bhatikar; (2) Smt. Jivamabai Raia Bhatikar; (3) Shri Shrikant Raia Bhatikar (4) Smt. Gangabai alias Meera Yeshwant Kunde; (5) Shri Datta Raia Bhatikar; (6) Smt. Nayan N. Rajadhyaxa; (7) Smt. Shital Gurudas Kamat Budkule; (8) Smt. Bharati Pandurang Kamat Maad; (9) Smt. Sunita Ajit Kamat; (10) Smt. Vandana Anil Bhangui; All residents of A-3, Laxmi Apartments, Second Floor, Pajifond, near old Power House, Margao-Goa (11) The Special Land Acquisition Officer, Goa IDC, Midas Touch Building, Second Floor, 2 Opposite Ed Dorado Plaza, Panaji, Goa .. Respondents. Mr. M. S. Sonak, Advocate for the Appellant. Mr. Sudin M. S. Usgaonkar, Advocate for respondent nos. 1 to 10. WITH CROSS OBJECTION. CORAM :- A. P. LAVANDE, J. Reserved on : - 24 th November, 2010 Pronounced on : - 7 th January, 2011. JUDGMENT : By this appeal, the appellant takes exception to the judgment and award dated 30th June, 2003 passed by the Additional District Judge, South Goa, Margao in Land Acquisition Case no.15/2002 partly allowing the reference under Section 18 of the Land Acquisition Act ('The Act' for short). 2. Vide notification dated 18th March, 1998, issued under Section 4 of the Act which was published in Official Gazette dated 2nd April, 1998, the Government of Goa acquired a portion of land admeasuring 16,300 square meters from Survey No.17/1 of Village Xelpe, Sangue Taluka 3 belonging to respondent nos.1 to 10 for the purpose of setting up of industrial estate at Xelpe and Kortali villages of Sangue Taluka. The Land Acquisition Officer ( The LAO) declared the award dated 14th August, 2001 and fixed the compensation at the rate of Rs.7/- per square meter in respect of the land and Rs. 2,17,064/- towards the value of the trees standing in the acquired land. The applicants accepted the compensation under protest and sought reference under Section 18 of the Act. Respondent nos. 1 to 10 claimed compensation at the rate of Rs.125/- per square meter and also claimed compensation of Rs.10 Lacs towards the value of cashew trees. 3. In Land Acquisition Case No.15/2002, respondent nos.1 to 10 examined Shrikant Raya Bhatikar-AW1 and Vikas Vithal Dessai- AW2- the valuer. AW1- Shrikant Bhatikar relied upon 7 sale deeds, the details of which are as under : Exhibit Sale deed date Distance 20 06/04/1984 100 meters away 21 27/02/1985 2.5 Kms. away 22 15/02/1999 4.5 Kms. away 23 06/01/1998 4 Kms. away 24 22/05/1998 2.5 Kms. away 25 21/12/1998 1.5 Kms. away 26 31/05/1999 4.5 Kms. away 4 AW1 also relied upon an award dated 10th May, 1991 in Land Acquisition Case No.70/1988. The land in the said award was 400 meters away from the acquired land. 4. AW2- Vikas Dessai relied upon the valuation report dated 17th March, 1999 – Exhibit 28. 5. The Reference Court placed reliance upon the sale deed dated 6th April, 1984 at exhibit 20, which was at a distance of about 100 meters away from the acquired land. The Reference Court held that since the said plot of land was situated in the vicinity and had similar advantages and disadvantages as that of the acquired land, the same could be considered for ascertaining the market rate of the acquired land. After taking into consideration the increase in the price at 5 % p.a., the Reference Court arrived at the figure of Rs.53/- per square meter and thereafter deducted 25 % on the ground that the acquired land was bigger plot of land whereas the sale deed plot was a smaller plot and arrived at the figure of Rs.44/- per square meter. Thereafter, the Reference Court deducted 10 % on the ground that the sale deed plot was bounded on one side by road, whereas the acquired land was at a distance of 100 meters away from 5 the road and fixed the market rate of the acquired land at Rs.35/- per square meter. The Reference Court rejected the reference in so far as the claim of the respondent nos.1 to 10 of Rs.10 Lacs towards the value of the cashew trees is concerned. 6. Mr. Sonak, learned Counsel for the appellant submitted that the sale deed dated 6th April, 1984 could not have been taken into consideration by the Reference Court in as much as the sale deed was executed about fourteen years before the publication of Section 4 notification and as such, could not have been the basis for fixing the market rate of the acquired land. He further submitted that none of the other sale deeds relied upon by respondent nos. 1 to 10 can be relied upon since they are not the sale deeds in respect of the comparable lands. He further submitted that since according to respondent nos.1 to 10 themselves, there were 275 cashew trees in the acquired land, the same had no building potential and as such, the acquired land could not have been valued on the basis of the building potential. He further submitted that in any case, respondent nos.1 to 10 are not entitled to value of the trees on the yield basis once the compensation is granted in respect of the land on the 6 basis of building potential. According to Mr. Sonak, having regard to the fact that the acquired land had substantial number of cashew trees, the acquired land can be only valued on the basis of yield by applying the appropriate multiplier, but in the absence of any cogent evidence having been led by respondent nos.1 to 10 regarding the income from the cashew trees, they are not also entitled to any higher compensation on the basis of yield. He further submitted that some of the sale deeds relied upon by respondent nos.1 to 10 are in respect of the plots which are situated far away from the acquired land and as such, could not be the basis for fixing the market rate of the acquired land. In support of his submissions, Mr. Sonak relied upon the following judgments : (i) General Manager Oil and Natural Gas Corporation Ltd. Vs. Rameshbhai Jeevanbhai and another; (2008)14 SCC 745. (ii) Land Acquisition Officer, Kammarapally Village, Nijamabad, Dist. A. P. Vs. Nookala Rajamallu and others; (2003)12 SCC 334. (iii) Administrator General of West Bengal Vs. Collector,Varansi; AIR 1988 SC 943. (iv) State of Haryana Vs. Gurucharan Singh and another; 1996 SC 106. 7 7. Per contra, Mr. Usgaonkar, learned Counsel for respondent nos.1 to 10 submitted that the Reference Court has erred in awarding compensation at the rate of Rs. 35/- per square meter and respondent nos.1 to 10 are entitled to compensation at the rate of Rs.95/- per square meter. He further submitted that in case it is held that sale deed dated 6th April, 1984 - exhibit 20 could not have been relied upon, the matter be remanded to the Reference Court in order to give an opportunity to respondent nos.1 to 10 to lead further evidence to prove their claim of Rs.95/- per square meter. He further submitted that the acquired land had building potential and all the amenities available nearby the acquired land and as such, respondent nos.1 to 10 are entitled to compensation at the rate of Rs.95/- per square meter. He further submitted that although there were 275 cashew trees in the acquired land, the Reference Court was justified in fixing the market rate of the acquired land on the basis of building potential by placing reliance upon the sale deed dated 6th April, 1984. Mr. Usgaonkar further submitted that in the event this Court comes to a conclusion that the sale deed dated 6th April, 1984 cannot be relied upon, the sale deed 6th January, 1998-exhibit 23, which is proximate in point of time can be relied upon for fixing the market rate of 8 the acquired land. He further submitted that the sale deed dated 22nd May, 1998- exhibit 24 and sale deed dated 21st December, 1998-exhibit 25 clearly disclose that the plots admeasuring 500 and 1352 square meters situated at a distance of 2.5 Kilometers and 1.5 Kilometers were sold at the rate of Rs.300/- and 100/- per square meter respectively and as such, respondent nos.1 to 10 are entitled to compensation at the rate of Rs.95/- per square meter. Mr. Usgaonkar further submitted that respondent nos.1 to 10 are entitled to compensation in respect of the trees separately by placing reliance upon the unreported judgment dated 6th October, 2010 delivered by the learned Single Judge of this Court in F. A. No. 42/2005 in the case of Shrimati Vishnath Acharya Vs. Special Land Acquisition Officer. 8. I have considered the rival submissions and perused the record and the judgments relied upon. 9. In view of the rival submissions, the following points arise for determination in the appeal : (i) Whether the Reference Court was justified in fixing the market rate of the acquired land at Rs.35/- per square meter ? 9 (ii) Whether respondent nos.1 to 10 are entitled to compensation at the rate of Rs.95/- per square meter in respect of the acquired land ? If not, what compensation respondent nos.1 to 10 are entitled to ? 10. Respondent nos.1 to 10 have relied upon several sale deeds and award passed in which Section 4 notification was issued on 7th October, 1985. The Reference Court has relied upon the sale deed dated 6th April, 1984 by which the land admeasuring 330 square meters was sold at the rate of Rs.30/- per square meter. The learned Judge, thereafter, granted increase at the rate of Rs.5/- per annum and on account of largeness of the acquired land deducted 25 % and thereafter, deducted 10 % on the ground that sale deed plot was bounded on one side by the road, whereas the acquired land was at a distance of 100 meters away from the road. Thus, the Reference Court fixed the market rate of the acquired land at the rate of Rs.35/- per square meter. In view of the judgment of the Apex Court in the case of General Manager Oil and Natural Gas Corporation Ltd. (supra), the approach of the Reference Court in relying upon the said sale deed cannot be sustained. In the said case, the Apex Court has held that sale deeds for a period for about 4 to 5 years prior to issuance of Section 4 notification can be relied upon 10 and beyond that it may be unsafe even if it relates to neiboughering land. The Apex Court further held that when the gap is larger, it is unsafe to rely upon the sale deed because in course of years, the rate of annual increase may itself undergo drastic change apart from likelihood of occurrence of varying periods of stagnation in prices or sudden spurts in prices affecting the very standard of increase. In my opinion, the ratio laid down in the said case is squarely applicable in the present case. In the present case, Section 4 notification was published in the Official Gazette on 2nd April, 1998, whereas the sale deed was executed on 6th April, 1984 i.e. about fourteen years prior to issuance of Section 4 notification. Therefore, no reliance can be placed on the said sale deed. Similar is the case in respect of the sale deed dated 27th February, 1985 and the award dated 7th October, 1985. 11. It is settled law that the sale deed in respect of the land, which is proximate in location and time vis-a-vis Section 4 notification can be relied upon provided the nature of the land acquired and the nature of the sale deed plot is similar. In case, the nature of the two properties is not the same, the Court has to make appropriate deductions/ 11 additions. In the present case, the sale deeds dated 15th February, 1999, 6th January, 1998, 22nd May, 1998 and 31st May, 1999 are in respect of the plots, which cannot be said to be proximate in location. Therefore, I find it unsafe to place reliance on any of the said sale deeds. The only sale deed which can be said to be proximate in point of time and location is sale deed dated 21st December, 1998- Exh.25 by which the plot of land admeasuring 1352 square meters was sold at the rate of Rs.100/- per square meter. The said plot was situated at the distance of about 1.5 kilometers away from the acquired land and was consisting of coconut trees and other fruit bearing trees as is evident from the sale deed. Perusal of the sale deed discloses that the said plot was bounded by P.W.D. road on the south side. 12. No doubt, sale deed dated 21st December, 1998 is post-notification sale deed, but the same is executed just eight months after the publication of Section 4 notification in the Official Gazette and, therefore, can be relied upon for the purpose of ascertaining the market rate of the acquired land. 13. The acquired land admeasures 16,300 square meters, whereas the plot sold by the said sale deed dated 21st 12 December, 1998 was admeasuring 1352 square meters. The acquired plot did not have advantage of an access by public road, whereas the sale deed plot had such an advantage. The sale deed plot had coconut trees and other fruit bearing trees, whereas in the acquired land there were 275 cashew trees. 14. Since the sale deed in respect of the plot was executed 8 months after the publication of Section 4 notification, the same would attract deduction of 5%. As such as on the date of publication of Section 4 notification, the market value of the sale deed plot works out to Rs.95/-. Considering that the acquired land was comparably bigger as compared to the plot sold by the said sale deed and the nature of the plot and the acquired land was not similar, I would deduct 53 % from the market value of the sale deed plot. Further deduction of 10 % on the ground that the sale deed plot had an advantage of road on the southern side would be also justified. Therefore, the total deduction would be 63 %. Thus, the market value of the acquired land on the date of publication of Section 4 notification works out to Rs.35.15 which is rounded up to Rs.35/- per square meter. 13 15. The next question which arises for consideration is whether respondent nos.1 to 10 are entitled to compensation of Rs.2,17,064/- in respect of the cashew trees existing in the acquired portion of land awarded by the Land Acquisition Officer. 16. In the case of Administrator General of West Bengal (supra), the Apex Court has held that it is trite proposition that where land is valued with reference to its potentiality on the basis of prices fetched by small site in hypothetical lay out, the tree-growth on the land cannot be valued independently on the basis of horticulture value or with reference to the value of the yield. But this principle does not come way of awarding the timber value or the salvage value of the trees-growth after providing for the cost of cutting and removing. The same principle was reiterated in the case of State of Haryana (supra). In the said case, the Apex Court held that separate compensation for land and fruit bearing trees cannot be awarded and compensation has to be awarded in respect of the value of the acquired land and the land includes benefit to arise from the land. In my considered opinion, the ratio of the aforesaid two judgments of the Apex Court is squarely applicable in the present case. 14 Therefore, with respect I am unable to place reliance upon the judgment dated 6th October, 2010 delivered by learned Single Judge of this Court in the case of Shrimati Acharya (supra) relied upon by Mr. Usgaonkar. No doubt as held in the case of State of Haryana (supra), the Court cannot reduce the rate given by the Collector even if the Collector had committed palpable error of law in awarding separate compensation for land and fruit bearing trees and had applied multiplier of more than 8 years. But the said principle will not be applicable in the present case in as much as the Land Acquisition Officer had awarded compensation at the rate of Rs.7/-, whereas the market rate of the acquired land has been fixed at Rs.35/- per square meter. The necessary sequitur, therefore, is that an amount of Rs.2,17,064/- awarded by the the Land Acquisition Officer has to be adjusted against the total compensation payable to the respondent nos.1 to 10 in respect of the acquired land. Respondent nos.1 to 10 have not led any evidence to prove that they are entitled to higher compensation in respect of 275 cashew trees existing in the acquired land. Moreover, the market rate of the acquired land has been fixed on the basis of the building potential by relying upon the sale deed dated 21st December, 1998. In so far as timber value of the 15 trees existing in the acquired land is concerned, respondent nos.1 to 10 have not led any evidence and as such, in the absence of any evidence, I am unable to award any compensation towards timber value of the trees existing in the acquired land. 17. In view of the above discussion, the market rate of the acquired land is fixed at the rate of Rs.35/- per square meter. However, the compensation of Rs.2,17,064/- awarded towards the cashew trees shall be adjusted towards the compensation payable to respondent nos.1 to 10. Respondent nos.1 to 10 are also entitled to all the statutory benefits under the Act. 18. The appeal and the cross-objection stand disposed of in aforesaid terms with no order as to costs. A. P. LAVANDE, J. SMA