THE HON’BLE SRI JUSTSICE B.SESHASAYANA REDDY Writ Petition No.16455 of 2007 (Dated : 17-08-2010) Between: GAIL (I) Ltd. Sheela Nagar, Visakhapatnam-50 012 Rep. by its General Manager …Petitioner A n d Sathivada Peddinaidu S/o Gangunaidu R/o Narva village, Pendurthi Mandal, Visakhpatnam District and another …Respondents THE HON’BLE SRI JUSTSICE B.SESHASAYANA REDDY Writ Petition No.16455 of 2007 ORDER: The petitioner is a Government of India company engaged in the distribution and sale of LPG and Natural Gas etc to the industrial consumers as per the allocation made by the Government of India. For the purpose of transporting the L.P Gas and natural Gas from one place to another, pipelines are laid under the ground as the same is being considered as the safest and convenient mode of transportation for gas. 2. The 1st respondent is the owner of Ac.0.14 cents and Ac.0.22 cents in Survey Nos.319-4p and 318-p respectively. Proceedings have been initiated under the provisions of Petroleum Mineral Pipelines (Acquisition of Right of User in Land) Act, 1962 (for brevity, ‘the Act’) for acquiring right of user to lay pipeline in the lands owned by the 1st respondent. A competent authority was appointed by the Government of India for determining the compensation payable to the land owner for acquiring right of user as well as the damages or losses sustained by the land owner due to removal of trees, standing crops etc. while laying pipelines. The competent authority determined the compensation payable to 1st respondent for acquiring the right of user in the lands owned by him in laying pipelines at Rs.14,033/-. Dissatisfied with the quantum of compensation, the 1st respondent filed an application under Section 10(2) and (5) of the Act for determination of the proper compensation. The I Additional District Judge, Visakhapatnam entertained the application filed by the 1st respondent and registered the same as P.L.O.P.274 of 2003. (b) Before the I Additional District Judge, Visakhapatnam, the 1st respondent examined himself as Pw-1 and marked four documents as Exs.A-1 to A-4 to substantiate his claim. Whereas the petitioner herein examined one witness as Rw.1 and marked five documents as Exs.B-1 to B-5. The learned I Additional District Judge, Visakhapatnam, on considering the evidence brought on record and on hearing the counsel appearing for the parties, enhanced the compensation from Rs.14,033/- to Rs.40,500/- under various counts and granted interest at the rate of 7.5% from 25.12.2002 till the date of realization, by judgment dated 24.7.2006. The said judgment is assailed in this writ petition. 3. Heard learned counsel appearing for the petitioner and learned counsel appearing for the 1st respondent. 4. Learned counsel appearing for the petitioner submits that the civil Court having not accepted Ex.A-3 sale deed placed on record by the 1st respondent herein committed serious error in enhancing the compensation. A further submission has been made that since 1/10th of the market value has been allowed to the land owners, granting any amount towards severance of the land is impermissible under the provisions of the Act. He would also contend that the interest allowed on the enhanced amount is not in accordance with the provisions of the Act and more particularly subsection (2) of Section 11 of the Act. 5. Learned counsel appearing for the 1st respondent supported the judgment impugned in the writ petition. 6. Section 10 of the Act deals with determination of the compensation, which reads as hereunder:- “COMPENSATION (1) Where in exercise of the powers conferred by Section 4, section 7 or section 8 by any person, any damage, loss or injury is sustained by any person interested in the land under which the pipeline is proposed to be, or is being, or has been laid, the Central Government, the State Government or the Corporation, as the case may be, shall be liable to pay compensation to such person for such damage, loss or injury, the amount of which shall be determined by the competent authority in the first instance. (2) If the amount of compensation determined by the competent authority under sub-section (1) is not acceptable to either of the parties, the amount of compensation shall, on application by either of the parties to the District Judge within the limits of whose jurisdiction the land or any part thereof is situated, be determined by the District Judge. (3) The competent authority or the District Judge while determining the compensation under sub-section (1) or sub-section (2), as the case may be, shall have due regard to the damage or loss sustained by any person interested in the land by reason of- (i) the removal of trees or standing crops, if any, on the land while exercising the powers under Section 4, section 7 or section 8; (ii) the temporary severance of the land under which the pipeline has been laid from other lands belonging to, or in the occupation of, such person; or (iii) any injury to any other property, whether movable or immovable, or the earnings of such persons caused in any other manner: Provided that in determining the compensation no account shall be taken of any structure or other improvement made in the land after the date of the notification under sub-section (1) of Section 3. (4) Where the right of user of any land has vested in the Central Government, the State Government or the Corporation, the Central Government, the State Government or the Corporation, as the case may be, shall, in addition to the compensation, if any, payable under sub-section (1), be liable to pay to the owner and to any other person whose right of enjoyment in that land has been affected in any manner whatsoever by reason of such vesting, compensation calculated at ten per cent of the market value of that land on the date of the notification under sub- section (1) of Section 3. (5) The market value of the land on the said date shall be determined by the competent authority and if the value so determined by that authority is not acceptable to either of the parties, it shall, on application by either of the parties to the District Judge referred to in sub-section (2), be determined by that District Judge. (6) The decision of the District Judge under sub-section (2) of sub-section (5) shall be final.” 7. The 1st respondent marked one document on his behalf in support of his claim. But the civil Court refused to place reliance on Ex.A-3 sale deed since it relates to a house site, whereas the land of the respondent is meant for agriculture. For better appreciation, I may refer para 13 of the cited judgment impugned in the writ petition, which reads as hereunder:- “ Petitioner in order to prove the market value relies upon Ex.A3 xerox copy of sale deed dt.5.9.2001 where under land in survey number 47/2 situate in Gajuwaka, Pendurthi Mandal, Visakhapatnam in an extent of 128.41 Sq. yards were sold for consideration of Rs.30,000/-. On perusal of the contents of Ex.A-3 sale deed it is seen that the land sold under ExA.3 is a house site whereas the present land is an agricultural land situated in Narava village of Pendurthi Mandal. In the evidence of petitioner who is examined as Pw.1, Pw.1 stated that the present land is a cultivable land and claims that the market value of his land is at Rs.14,000/- per cent. Even according to the evidence of Pw.1, the petitioner herein the land covered under Ex.A.3 is on the northern side of the village. Whereas the present land of the petitioner is at a distance of four to five yards from the village and that his entire land is being used for paddy cultivation. On perusal of the evidence of Rw.1 who assisted respondent No.2 in gathering material for ascertaining the market value of the petitioner Rw.1 states that while assessing the compensation for the land of the petitioner they visited the office of Sub Registrar and verified the sale deeds and ascertain the market value of the land of the petitioner. Respondents did not produce any material for ascertaining the market value of the petitioner’s lad as Ex.A.3 sale deed relates to the house site and the particulars to the house site and the particulars relating to the location of the land covered under Ex.A3 is not spoken to by petitioner it cannot be ascertained whether the land coved under Ex.A.3 is the neighbouring land of the present land as such Ex.A.3 sale deed will be of no help to come to the conclusion for ascertaining the market value of the present land………….” 8. However, the civil Court proceeded to take the value of the land at Rs.2,50,000/- per acre as Pendurthi village is adjoining to visakhapatnam. The Civil Court granted Rs.18,000/- towards crop loss. Land has been handed over to the land owner after completion of laying of pipeline within an year. Therefore, he is entitled to crop loss of Rs.6,000/- only. Therefore, the amount awarded under crop loss has been reduced from Rs.18,000/- to Rs.6,000/- . 9. With regard to reclamation of the land, there is no evidence on record that the petitioner herein levelled land and handed over to the 1st respondent after completing laying of pipelines. Therefore, the Civil Court is justified in granting compensation of Rs.3,000/- for reclamation of the land. As per sub-section 3(ii) of Section 10 of the Act, temporary severance of the land is also required to be taken into consideration for ascertaining the compensation. The Civil Court awarded Rs.4500/- towards severance charges. The quantum of amount awarded is not on high side. Therefore, I decline to interfere with the quantum awarded towards severance charges. 10. Coming to the rate of interest, the civil court awarded interest at 7.5% p.a on the enhanced compensation, which is contrary to sub-section (2) of Section 11. Sub-section (2) of Section 11 of the Act reads as hereunder:- “11(2): If the amount of compensation is not deposited within the time prescribed under sub-section (1), the Central Government, the State Government or the Corporation, as the case may be, shall be liable to pay interest thereon at the rate of six per cent per annum from the date of on which the compensation had to be deposited till the date of the actual deposit.” A plain reading of the above-referred provision indicates that the interest permissible on the compensation is at 6%. Therefore, the interest awarded on the enhanced compensation is reduced from 7.5% to 6% per annum from 25.12.2002 to till the date of realization. 11. Accordingly, the writ petition is allowed in part reducing the compensation from Rs.40,500/- to Rs.28,500/- and also reducing the rate of interest from 7.5% p.a to 6% per annum on the enhanced amount. No costs. _____________________ B.SESHASAYANA REDDY, J Dt.17-08-2010 RAR THE HON’BLE SRI JUSTSICE B.SESHASAYANA REDDY Writ Petition No.16455 of 2007 (Dated : 17-08-2010)