IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE PIUS C.KURIAKOSE & THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM MONDAY, THE 31ST MAY 2010 / 10TH JYAISTHA 1932 LA.App..No. 406 of 2003(B) ------------------------- LAR.50/1996 of SUB COURT, SULTHAN BATHERY .................... APPELLANT(S): CLAIMANT ---------------------- ELSTONE TEA ESTATE LTD., KALPETTA, REPRESENTED BY ITS POWER OF ATTORNEY HOLDER T.B.KUNHIMAHIN HAJEE, S./O. T.B.MOIDEEN KUNHI, MANAGING DIRECTOR, PADHOOR PLANTATIONS PVT.LTD., KALPETTA, WAYANAD DISTRICT BY ADV. SRI.M.K.DAMODARAN, SENIOR ADVOCATE SRI.PIUS C.MUNDADAN RESPONDENT(S): RESPONDENT ------------------------- STATE OF KERALA, REPRESENTED BY ASSISTANT COLLECTOR & LAND ACQUISITION OFFICER, MANANTHAVADI. GOVERNMENT PLEADER SRI.M.R.SABU SRI.RANJITH BABU,ADVT.COMMISSIONER THIS LAND ACQUISITION APPEAL HAVING BEEN FINALLY HEARD ON 13/03/2009 , THE COURT ON 31/05/2010 DELIVERED THE FOLLOWING: PIUS C.KURIAKOSE & C.K.ABDUL REHIM, JJ. ---------------------------------- L.A.A. No.406 of 2003 ---------------------------------- Dated this the 31st day of May, 2010 J U D G M E N T ---------------------- Abdul Rehim,J. Claimant in LAR.50/1996 on the files of the Subordinate Court, Sulthanbathery is in appeal seeking enhancement of the compensation allowed in a reference under Section 18 of the Land Acquisition Act. 3.2760 Hectares of land corresponding to 8 Acres 9 cents situated in Kalpetta Village was acquired for formation of Kalpetta Bye- pass. Section 4(1) notification was published on 1.3.1994. Land Acquisition Officer awarded compensation at the rate of Rs.2,006/- per cent. A claim statement was filed seeking enhancement of Rs.25,000/- per cent. Reference court re- fixed the land value at Rs.4,000/- per cent. Being not satisfied the claimant has filed this appeal. 2. Evidence before the reference court consisted of oral testimonies of AW1 and AW2 and documentary evidence of Exts.A1 to A6 on the side of the claimant. RW1 was L.A.A.406/03 2 examined and Exts.R1 to R10 were marked from the side of the respondents. The reference court has not relied on Exts.A2, A3 and A4 sale deeds produced by the claimant since the properties covered by those documents are small plots situated in the heart of Kalpetta town, whereas the acquired property is a Tea estate, which is lying comparatively in an interior part. Ext.A5 sale deed was also not accepted more or less for the same reason. 3. Ext.A6 is the award passed with respect to the acquisition of 50 cents of land for establishing police station at Kalpetta. Statutory notification in that case was published on 28.7.1988, approximately six years prior to notification in the present case. The said property is lying adjacent to Kozhikode- Mysore National Highway. Reference court found that Ext.A6 property and the acquired property could not be treated as similar and similarly situated. But it is observed that property covered under Ext.A6 being situated not far away from the acquired property, the value mentioned thereof has some relevance, especially because both the properties are covered under the same survey number. Reference court relying on the dictum in State of Madras Vs. A.M. Nanjan and L.A.A.406/03 3 another (AIR 1976 SC 651) and State of Kerala Vs. Valiyamma Ponnamma and others (AIR 1985 (Kerala) 1), observed that award passed with respect to adjoining property could not be rejected as an inadmissible item of evidence. The Reference court found that property covered under Ext.A6 is nearer to the acquired property than the basis land relied on by the LAO. Value given in Ext.A6 is around Rs.9,000/- per cent. But observing that the acquired land is situated about 400 Metres away from Kozhikode-Mysore Road, that value was not adopted as basis. The reference court re-fixed land value at Rs.4,000/- per cent, applying the rule of thumb. 4. The appellant has produced copies of judgments of this court in LAA.No.538/1994 dt. 24.7.1998 and in LAA.No.364/2007 and connected cases dt.2.1.2009, as Annexure-1 and II respectively. As per order in I.A.No.288/09 this court deputed an Advocate Commissioner to inspect the acquired properties and to report nature, lie and importance of the acquired property and also to have comparison of the acquired property with that of the properties covered under Annexure-1 and 2, as well as properties covered by Exts.A5 and A6. The Advocate Commissioner filed report dt. 25.2.2009 L.A.A.406/03 4 and the respondent has filed objection to that report. 5. It has come out in evidence that the acquired land is part of a Tea estate. It is admitted case of the petitioner that the acquired land situates at a length of 1100 Metres with a width of 30 Metres. Ext.P4 'Notes to Award' reveals that the land in question is 'Purayidam' as per Village Records. In the claim submitted before the Land Acquisition Officer it is admitted that the acquired portion is lying contiguous to the Estate and the claimant company was getting an average yield of 10,000 Kgs per year, which will fetch an income of about Rs.4 lakhs. In Ext.P4 the land is described as situated in an interior area having no direct access to the public road. On the other hand, contention of the petitioner is that the property is lying parallel to Kozhikode-Mysore National Highway on its eastern side and the distance from the National Highway to the acquired portion varies from 350 Metres to 400 Metres at different points. It is contended that there exists five direct access from the Kozhikode-Mysore Road to the acquired land. Further, there is access from Meppadi-Ootty inter-State Road through the estate road, namely 'Elstone Estate Road'. It is also contended that there is access to the acquired property L.A.A.406/03 5 from 'Rattakkolly Road' which touches Gate of the estate. According to the petitioner, the property is situated in the heart of Kalpetta town and so many public institutions are situated within a distance of 400 Metres. The KSRTC Busstand at Kalpetta is situated within a distance of 1 Km. Contention of the petitioner is that the acquired property is a developed 'Purayidam' adoptable as site for building construction. Hence it is contended that potentiality of the land as a building site, should be considered while fixing the compensation. The learned counsel pointed out the decisions reported in 1996 (3) SCC 735, 1998 (2) SCC 50 and 2008 (2) KLT 129 (SC)) in support of such contention. On the other hand, findings of the Land Acquisition Officer as evidenced from the Notes to Award is to the effect that the commercial importance of the land could not be taken note of while fixing the compensation, as the land in question is part of an estate which cannot be converted into commercial land in view of the provisions contained in the Kerala Land Reforms Act as well as the Kerala Land Utilisation Order. 6. In the report of the Advocate Commissioner it is mentioned that there exists four link road access from the L.A.A.406/03 6 property to the Kozhikode-Mysore National Highway and the distance through such link roads varies from 300 to 450 Metres. It is also mentioned that there is access to the Meppadi-Ootty inter-State Road through the Elstone Estate Road. Further, 'Rattakkolly Road' is touching the Gate of estate, which is situated adjoining to the acquired property and hence it can be considered as the acquired property is having access to the 'Rattakkolly Road'. Further it is reported that the Elstone Estate Road was having 14 Metres width at the time of acquisition and at present it is widened to 30 Metres. It is also mentioned that within a radius of 1 Km many institutions and commercial establishments like, Kolathinal Hospital, Depaul Convent, St.Vincent Forona Church, Depaul Public School, Sree Ayyappa Shopping Complex, Makarajyothi Kalyana Mandapam, Sree Ayyappa Temple, Cosmopolitan Club and Auditorium, Lalith Mahal Auditorium, Kottaram Apartment, Subha Flour Mill, Kalpetta Petroleum Pump, Blomker Store, Anantha Pathma Theatre now known as Ananthaveer Theatre, service station, Mahaveer Theatre, K.J.Hospital, Marry Amman Temple, Geetha Store, Vijaya Petrol Pump, Matha Tourist Home on the eastern side of the L.A.A.406/03 7 Calicut-Mysore Road, and Government Institutions namely Kalpetta Police Station, Government Hospital, Government U.P School, Khadi Grama Vyavasaya Office, Sales Tax Office, Agricultural Office, Village Office, Statistics Office, Telephone Exchange, and Government institutions namely Fire Force Station, Life Insurance Corporation, KSEB Assistant Engineer Office, KSEB Office, Post Office, State Bank of Travancore, Vythiri Co-operative Bank, Vijaya Bank, Catholic Syrian Bank and industries like Elstone Tea Factory, Premier Engineering Industry, Subha Flour Mill, etc: are situated within the nearby vicinity within a distance of 450 Mtrs to 1 Km. 7. The respondent has filed objection to the Commission Report stating that out of the 4 link road access to the Kozhikode-Mysore National Highway, except one road namely Leo Hospital Road, others are only narrow bye-roads. Findings of the Commissioner that the entire property is a level land is also disputed stating that it is a pucca Tea estate situated in a remote area and it is not at all a developed area. Observations of the Advocate Commissioner that the entire property is a developed area in the heart of Kalpetta town is also strongly disputed stating that it is evident from the L.A.A.406/03 8 Commission Report itself that the property is situated away from the Kozhikode-Mysore Road. It is stated that the property is not having any commercial importance. 8. The property covered under Annexure-1 Judgment was acquired for the establishment of Social Forestry Complex at Kalpetta. Notification in that case was published on 15.7.1986, i.e:, about 8 years prior to notification in the present case. The property is situated in Kalpetta town 30 Metres away from Kalpetta-Pinangode Road which starts from Kozhikode-Mysore Road. The distance from the main junction of the Kalpetta town is stated to be 63 Metres. The property seems to be an arecanut plantation. Claimant in that case had produced a sale deed dt.27.2.1986, which revealed consideration at the rate of Rs.9,000/- per cent. The property covered under that document was found to be situated on the side of Kozhikode-Mysore main road. Reference court had re- fixed land value in that case at Rs.4,500/- per cent, being 50% of the value shown in the above said document. This court found that the learned Subordinate Judge was not justified and enhanced the land value to Rs.6,000/- per cent, being 2/3rd of the land value shown in the sale deed. The Advocate L.A.A.406/03 9 Commissioner had compared the acquired property with the property in Annexure-1. Contrary to the findings in Annexure- 1 Judgment it is stated that the property is situated 1½ Km away from Kalpetta junction on the side of a narrow pocket road deviating from the Pinangode road at a distance of 200 Metres. According to the Commissioner, the property is situated in an area where there is no commercial importance. But in the objection filed to the commission report the respondent has disputed such observations stating that the property is having more importance than the acquired property. It is stated that the Pinangode road is an important road compared to the roads leading to the acquired property. However, we notice that for a property which is situated in an area nearby Kalpetta town which is acquired through notification published in the year 1986, this court has re-fixed land value at Rs.6,000/- per cent. 9. Annexure-2 is a common judgment of this court in LAA.364/2007 and connected cases. The acquisition pertains to the very same purpose of construction of Kalpetta Bye-pass. But the notification under Section 4(1) is dated 23.3.1993, i.e., almost one year prior to the notification in this case. Property L.A.A.406/03 10 covered therein is mentioned as situated at a distance of about 240 Metres away from Kozhikode-Mysore National Highway. It is revealed that the property is on the backside of the Judicial Court Complex and Civil Station wherein District Collectorate is functioning. There is evidence to the effect that the property is at 130 Metres away from the Civil Station Complex and District Court Complex. Reference court fixed the land value in that case at Rs.10,000/- per cent. Considering locational importance of the property, this court found that the amount fixed by the reference court is grossly inadequate. But considering the fact that the appellants therein had claimed land value only at the rate of Rs.12,000/- per cent, this court re-fixed land value at Rs.12,000/- per cent. In the report of the Advocate Commissioner it is noted that the property covered under LAA.364/2009 is having access only through 'Smasanam Road' or 'Quarry road'. According to the Commissioner, there is not even a single shop or establishment nearby the properties in question and it is situated in an isolated area having no commercial importance. It is mentioned that on comparison it is clear that the acquired property is situated in a more advantageous position at a L.A.A.406/03 11 location having large commercial importance. Of course, the respondents are strongly disputing the commissioner's version through their objections. 10. Sri.Pius C. Mundadan, learned counsel for the appellant made strenuous and persuasive arguments for enhancement of the land value taking note of Ext.A6, Annexure-1 and 2 Judgments and also based on the report of the Advocate Commissioner deputed from this court. The claim in the appeal was originally for land value at the rate of Rs.10,000/- per cent. I.A.No.815/2009 is filed seeking amendment of the memorandum of appeal with enhancement of the claim to the tune of Rs.14,000/- per cent. 11. As detailed in the foregoing paragraphs, Ext.A6 is an award passed by the reference court with respect to acquisition of 50 cents of land for establishing police station at Kalpetta. The relevant notification was about six years prior to the notification in the present acquisition. It is true that the property covered therein is situated adjacent to Kozhikode- Mysore National Highway and the extent is only 50 cents. Therefore the reference court was justified in finding that the properties could not be treated as similar and similarly L.A.A.406/03 12 situated. But the reference court observed that there is some relevance in fixing the compensation since the property in question is situated not far away from the acquired land and that both the properties are covered by the same survey number. The reference court also observed that going by the settled legal precedents an award passed with respect to adjoining property could not be treated as inadmissible. But observing that the acquired property is not having any road access, the value is fixed as Rs.4,000/- per cent inspite of the fact that value in Ext.A6 is Rs.9,000/- per cent. Considering the fact that there is a difference of 6 years in between the acquisitions and also considering the fact that there is ample evidence adduced before this court to prove that there were accesses from the acquired property to the National Highway, we are of the considered opinion that the reference court was not at all justified in fixing such an amount, which is below 50% of the amount awarded in Ext.A6. 12. Considering the legislative intentions and principles underlying Section 28A of the Land Acquisition Act, we cannot ignore compensations ultimately awarded by this court with respect to acquisitions of lands situated in the nearby locality, L.A.A.406/03 13 especially with respect to the lands acquired for the very same purpose. In Annexure-1 Judgment, with respect to an acquisition made about 8 years back, this court had awarded land value at the rate of Rs.6,000/- per cent. Compared on the basis of available materials and evidence, despite the fact that we are not fully accepting the report of the Advocate Commissioner, it is evident that the property covered under Annexure-1 is situated not in a commercially important locality. As far as Annexure-2 Judgment is concerned, we notice that the acquisition is for the very same purpose and the notification is prior to one year of the present acquisition. The reference court fixed land value at the rate of Rs.10,000/- per cent, which this court has enhanced to Rs.12,000/-. One among us (Justice Pius C.Kuriakose) is party to that Judgment. Therefore we are inclined to place reliance on Annexure-1 and to grant considerable enhancement with respect to land value. 13. Eventhough it is brought out through the report of the commissioner that the acquired property is having different access to the National Highway as well as access through the Elstone Estate Road and Rattakkolly road, the fact remains that the acquired land is part of a large Tea Estate. It L.A.A.406/03 14 has also come out in evidence that the acquired property is situated at a length of 1100 Metres (1.1 Km) at a width of 30 Metres. There is absolutely no evidence to the effect that the acquired property is situated anywhere on the side of the National Highway or it is abutting to any main road which is having any commercial importance. It is true that there are a lot of public institutions of importance and commercial establishments within a radius of 1 Km from the acquired land. But it could not be presumed that the acquired land is a commercial land or is a developed site for building. On the other hand, it is part of a Tea Estate. Therefore we are of the considered opinion that the property is not having as much commercial importance when compared with the property covered under Ext.A6 or Annexure-2. 14. Another crucial aspect which has to be taken note of while fixing compensation is the extent of the acquired land, which is 3.276 Hectares corresponding to 8 Acres 9 cents. The properties covered under Ext.A6 and Annexure-1 and 2 are smaller extents when compared to the acquired property. Property covered under Ext.A6 is only having an extent of 50 cents. As such the price cannot be adopted with respect to L.A.A.406/03 15 large extent of an area situated in a Tea Estate. The property covered under Annexure-2 is only 0.48 Hectares. But the compensation given by this court in Annexure-2 judgment could not be discarded in toto. Eventhough the extents of property covered under those cases are smaller when compared to the acquired property in the present appeal, it should be remembered that the acquisition is for the very same purpose and the date of notification is one year prior to the notification in the instant case. Evidence is to the effect that the property in that case is also situated at 240 Metres away from the Kozhikode-Mysore National Highway. But of course, there is locational importance when compared with the acquired property because it is evident that the property covered under that judgment is situated at a distance of 130 Metres from the Civil Station Complex and District Court Complex. So also it is to be noted that the reference court had granted compensation at the rate of Rs.10,000/- per cent which is enhanced to Rs.12,000/- by this court. 15. While fixing the rate of compensation payable, as observed above, we notice the difference regarding extent of the land covered under the judgments relied on with that of the L.A.A.406/03 16 acquired property. The Hon'ble apex Court in various decisions like 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) 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. 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 sale of small parcels of land cannot be comparable. Decision of Bhim Singh & others Vs. State of Haryana & another ((2003) 10 SCC 529) is also on the same line. A more important and 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 L.A.A.406/03 17 sites like, laying out roads, drains, sewers, water and electricity lines and other civic amenities. In order to make up 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. Going by the dicta in the above referred cases it is clear that for deciding the question the foremost consideration should be for the land eventhough larger in extent is situated in a developed condition or not, and as to whether any development is required for the purpose which is acquired. It is settled precedent that value of smaller plots cannot be adopted as basis for fixing value of larger extents. It is also of common knowledge that market value of smaller plots will also be higher than plots covered by large extents. The next question is as to what should be the rate of such deduction. Taking note of the fact that the property in question is having an extent of 8 Acres and 9 cents which forms part of a large Tea Estate lying at a distance of about 300 to 450 Metres from the commercially important location of Kalpetta town and situated at a length of 1100 Metres we are of the considered opinion L.A.A.406/03 18 that a reduction at 20% from the value awarded in Annexure-2 Judgment will be just and reasonable compensation to be granted in the appeal in question. Hence we re-fix the land value at the rate of Rs.9,600/- per cent as against the compensation of Rs.4,000/- awarded by the reference court. 16. As we have re-fixed the land value at Rs.9,600/- per cent we observe that the amendment sought for in I.A.815/09 need not be allowed. 17. In the result, the appeal is partly allowed enhancing the compensation to Rs.9,600/- per cent with respect to the land value. Needless to say that the appellant will be entitled for all statutory benefits admissible under law as granted by the reference court. The parties are directed to suffer their respective costs. PIUS C.KURIAKOSE, JUDGE. C.K.ABDUL REHIM, JUDGE. okb