IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 02.03.2010 CORAM : THE HONOURABLE Mrs.JUSTICE R.BANUMATHI and THE HONOURABLE Mr.JUSTICE A.ARUMUGHASWAMY A.S.No132 of 2007 The Land Acquisition Officer and Revenue Divisional Officer, Coimbatore. ... Appellant/Referring Officer vs. 1. P.Palaniammal 2. P.Kanakaran 3. Rajamani 4. P.Gunasekaran 5. K.Gopal 6. K.Murugesh 7. R.Mayilathal 8. Ashokkumar 9. Nithya ... Claimants | | 10.The Controller of Aerodrome, |Respondents Civil Aerodrome, Peelamedu, | Coimbatore. ... Beneficiary | Prayer: Appeals filed under Section 54 of Land Acquisition Act against the Common Judgment made in L.A.O.P.No.141 of 2000 dated 29.10.2004 on the file of I Additional Subordinate Judge, Coimbatore. For Appellant : Mr.V.Ravi Special Government Pleader [AS] For Respondents/Claimants 5 to 9 : Mr.N.Manoharan For Acquisition Body/ Beneficiary : Mr.T.A.Srinivasan for M/s. Sree and Associates. For Respondents 1 to 4 : D.Shivakumaran https://hcservices.ecourts.gov.in/hcservices/ JUDGMENT R.BANUMATHI,J Being aggrieved by enhancement of compensation for the lands acquired for extension of existing run-way of Coimbatore Airport, Land Acquisition Officer has filed this Appeal. 2. At the instance of the Senior Aerodrome Officer, Coimbatore Airport, acquisition proceedings were initiated for acquisition of an extent of 18.16.5 Hectares comprised in S.F.No.601/1A2 etc. measuring 7.43.5 Hectares of Kalapatty village in Coimbatore and in S.F.No.316/5B etc. measuring 19.68.0 Hectares of Uppilipalayam village of Coimbatore including S.F.No.324/1A2 – 0.18.0 Hectares and S.F.No.324/1B2 – 0.24.5 Hectares under urgency clause of Land Acquisition Act to wit for the use of extension of existing run-way of Coimbatore Airport and providing approach lighting system. As the land acquisition proceedings in this case were initiated under urgency clause, enquiry under Sec.5(A) of Land Acquisition Act was withheld. The Draft Declaration under Sec.6 of the Act was approved in G.O.Ms.No.3145, Transport dated 01.07.1992. Award enquiry under Sec.11 of the Act were conducted on 04.7.1994, 06.7.1994 and 08.7.1994 respectively. Sales statistics were gathered for the proceeding one year from the date of publication of Sec.4(1) notification i.e. 29.05.1992. Among such sales, the sale of the land that took place in S.F.No.712 of Kalapatty village was taken as data land for fixing the land value for the acquisition fields. As per Document No.1721 dated 12.3.1992, in S.F.No.712 of Kalapatty village, an extent of 1.73 acres was sold for Rs.1,78,500/- which comes to Rs.1,03,179.19 per acre or Rs.2,54,853.00 per Hectare which was taken by the Land Acquisition Officer for comparison. S.F.No.712 of Kalapatty village was taken as data land as it lies within 1.5 K.M. distance from the acquisition fields and the Land Acquisition Officer felt that both data land and the acquisition fields are similar in all aspects. 3. On objection raised by the land owners, Sec.18 reference was made. In the Reference Court, all the matters relating to the acquisition of lands to wit for the use of extension of existing run- way of Coimbatore Airport were taken up together. Before the Reference Court, a batch LAOPs. were taken up together and disposed of by common Judgment including L.A.O.P.No.141/2000. Claimants Vijayakumar [Claimant in LAOP.No.130/1996] and Ramachandran[1st Claimant in LAOP.No.134/2006] were examined as CW1 and CW2 respectively. Exs.C1 to C13 were marked on the side of Claimants. On the side of Referring Officer, one Nararayanamurthy was examined as RW1 and Exs.R1 to R4 were marked. On the side of Acquisition Body/Beneficiary, one Gopalakrishnan was examined and 10 documents were marked. https://hcservices.ecourts.gov.in/hcservices/ 4. Based on Exs.C1 and C2-Layouts and Ex.C4 [05.05.1989] and Ex.C5 [11.9.1991] sale deeds, Reference Court had observed that the market value of the acquired lands would fetch Rs.20,00,000/- per Hectare. Giving 60% deduction, Court has arrived at the value at Rs.7447/- per cent. However, pointing out that before the Land Acquisition Officer, Claimants themselves have asked only for Rs.10,00,000/- per Hectare, Reference Court fixed the market value at Rs.5000/- per cent. In so far as, LAOP.No.137/1996, Court has fixed the market value at Rs.8000/- per cent which was ordered by separated from the Batch of cases. Reference Court also ordered 30% solatium, 12% additional market value and interest at 9% for one year from 26.06.1992 to 25.6.1993 and thereafter interest at the rate of 15% p.a. till the date of realisation. 5. Challenging the enhancement of compensation, Mr.V.Ravi, learned Special Government Pleader has submitted that Reference Court erred in taking Exs.C4 and C5 sale deeds as the comparable sale deeds and the properties sold under those sale deeds are very far away from the acquired lands and the enhancement of compensation of Rs.5000/- per cent made by the Reference Court is on the higher side. 6. We have heard Mr.N.Manoharan, learned counsel appearing for Respondents 5 to 9. We have also heard Mr.T.A.Srinivasan, learned counsel for Acquisition Body/Beneficiary. 7. Learned counsel for Respondents 5 to 9/Claimants submitted that the acquired lands [S.No.324/1A2 – 0.18.0 Hectares and S.F.No.324/1B2 – 0.24.5 Hectares] are in Uppilipalayam village and is situated in the midst of developed area and the compensation fixed by the Reference Court at Rs.5000/- per cent is very less amount warranting no interference. Learned counsel for Respondents 5 to 9 would also submit earlier by order dated 23.2.2010 in A.S.No.123 of 2007 Batch, the Division Bench of this Court confirmed the market value of Rs.5000/- per cent fixed by the Reference Court. 8. As pointed out earlier, S.F.No.712 of Kalapatty village was found similar in all respects. As per Document No.1721 dated 12.3.1992, an extent of 1.73 acre was sold for Rs.1,78,500/-. Based on which, the Land Acquisition Officer had fixed the value at Rs.1,03,179.19 per acre or Rs.2,54,853/- per Hectare. It has been brought in evidence that the acquired lands are surrounded by Airport, Railway Station, Residential colony and various multi speciality hospitals. When the acquired lands are in the midst of developed area, Land Acquisition Officer was not justified in taking Document No.1721 dated 12.03.1992 for comparison in which large extent of land was sold as agricultural land. 9. In a catena of decisions, the Supreme Court has laid down the governing principles for determination of market value and the amount https://hcservices.ecourts.gov.in/hcservices/ of compensation. The positive as well as negative factors to be taken into consideration for arriving at the correct market value. In (2005) 4 SCC 789 [Viluben Jhalejar Contractor v. State of Gujarat], the Supreme Court held as under:- "18. One of the principles for determination of the amount of compensation for acquisition of land would be the willingness of an informed buyer to offer the price therefor. It is beyond any cavil that the price of the land which a willing and informed buyer would offer would be different in the cases where the owner is in possession and enjoyment of the property and in the cases where he is not. 19. Market value is ordinarily the price the property may fetch in the open market if sold by a willing seller unaffected by the special needs of a particular purchase. Where definite material is not forthcoming either in the shape of sales of similar lands in the neighbourhood at or about the date of notification under Section 4(1) or otherwise, other sale instances as well as other evidences have to be considered. 20. The amount of compensation cannot be ascertained with mathematical accuracy. A comparable instance has to be identified having regard to the proximity from time angle as well as proximity from situation angle. For determining the market value of the land under acquisition, suitable adjustment has to be made having regard to various positive and negative factors vis-a-vis the land under acquisition by placing the two in juxtaposition. The positive and negative factors are as under:- Positive factors Negative factors (i) smallness of size (i) largeness of area (ii) proximity to a road distance (ii) situation in the interior at a 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 developed locality (vi) level vis-a-vis land under (vi) some special disadvantageous acquisition factors which would deter a purchaser https://hcservices.ecourts.gov.in/hcservices/ Positive factors Negative factors (vii) special value for an owner of an adjoining property to whom it may have some very special advantage 21. Whereas a smaller plot may be within the reach of many, a large block of land will have to be developed preparing a layout plan, carving out roads, leaving open spaces, plotting out smaller plots,waiting for purchasers and the hazards of an entrepreneur. Such development charges may range between 20% and 50% of the total price. 10. Acquired lands are access both from Avinashi Road and Trichy Road. Several educational institutions are situated in and around the acquired lands. That apart, multi speciality hospitals are also situated nearby. SITRA and other Mills are also situated in the surrounding of the acquired lands. In their evidence, Claimants have further stated that the acquired lands being situated in the midst of developed area surrounded by educational institutions, multi speciality hospitals and Mills has higher market value. Claimants have further stated that Kalapatty and Uppilipalayam are in the centre of Coimbatore and the layouts have been formed and lands are only sold as house plots. 11. The oral evidence adduced by the Claimants Vijayakumar and Ramachandran is strengthened by Exs.C1 to C3-Layouts formed in the surrounding area. As seen from Ex.C4 sale deed dated 05.05.1989 wherein an extent of 0.65¾ cents in S.F.No.297/2 was sold for Rs.10,00,000/- [Rs.15,159/- per cent]. Like wise, in Ex.C5 [11.9.1991], an extent of 3600 sq.ft. in Plot No.20 of Alamelu Nagar Layout was sold for Rs.1,81,836/- [Rs.21,800/- per cent]. Exs.C4 and C5 are the sale deeds of the year 1989 and 1991 respectively, atleast two years prior to the acquisition. When the lands were acquired invoking urgency clause dispensing with enquiry under Sec.5 (A) of the Act, the Land Acquisition Officer ought to have been more reasonable in fixing the market value. 12. For determining the amount of compensation payable in respect of the lands acquired by the State, market value therefor is to be ascertained. The expression 'market value' has been the subject matter of consideration by the Supreme Court in several cases. Market value is the price that the willing purchaser would pay to the willing seller for the property having due regard to its existing condition with all its existing advantages and its potential possibilities. In considering the 'market value' the guiding factor would be the conduct of hypothetical willing vendor who would offer the land and a purchaser in normal human conduct would be willing to buy as a prudent man in normal market conditions. For ascertaining https://hcservices.ecourts.gov.in/hcservices/ the market value of the land, the area of the land, nature thereof and advantages and disadvantages occurring therein amongst others would be relevant factor for determining the actual market value of the property. That apart, potentiality of the acquired land should also be taken into consideration. 13. Considering the factors whether the land has got potential value or not, in (2008) 3 MLJ 806 (SC) [Atma Singh (died) through LRs and others v. State of Haryana and Another], the Supreme Court has held as under:- "5. For ascertaining the market value of the land, the potentiality of the acquired land should also be taken into consideration. Potentiality means capacity or possibility for changing or developing into state of actuality. It is well settled that market value of a property has to be determined having due regard to its existing condition with all its existing advantages and its potential possibility when led out in its most advantageous manner. The question whether a land has potential value or not, is primarily one of fact depending upon its condition, situation, user to which it is put or is reasonably capable of being put and proximity to residential, commercial or industrial areas or institutions. The existing amenities like, water, electricity, possibility of their further extension, whether near about Town is developing or has prospect of development have to be taken into consideration. See Collector Raigarh v. Hari Singh Thakur, AIR 1979 SC 472, Raghubans Narain v. State of U.P., AIR 1969 SC 465 and Administrator General, W.B. v. Collector Varanasi (supra). It has been held in Kaushalya Devi v. L.A.O. Aurangabad, AIR 1984 SC 892 and Suresh Kumar v. T.I.Trust, AIR 1980 SC 1222 that failing to consider potential value of the acquired land is an error of principle." 14. As is seen from the oral and documentary evidence, acquired lands are situated in the midst of developed area. When the acquired lands are in the midst of developed area having access from both two main roads, the Land Acquisition Officer was not justified in taking the data sale deed in S.F.No.712 in which an extent of 1.73 acre [agricultural land] was sold at Rs.1,78,500/-. 15. We have gone through the Topo sketch. Even though, S.F.No.297/2 [Ex.C4] and Plot No.20 of Alamelu Nagar Layout are slightly far away from the acquired lands, the potentiality of the acquired lands have to be kept in view. In his evidence, RW1-Land Acquisition Officer himself has admitted that the acquired lands are situated in the midst of developed area. RW1 has further deposed https://hcservices.ecourts.gov.in/hcservices/ that the acquired lands are having access from main Roads and near to the City. Being near to the city and in the midst of developed area, the acquired lands are in advantageous position having potentiality of development. While fixing the market value, the Land Acquisition Officer is required to consider the location of property, its advantages as well as potentiality. Existing amenities that the acquired lands having access to two main Roads and its potentiality to residential, commercial and educational institutions and its proximity to Coimbatore City, the prospect of future development have to be taken into consideration. As per Exs.C4 and C5 sale deeds, the market value per cent is Rs.15,159/- and Rs.21,800/- respectively. When nearby area the Plots were sold as house plots, in our considered view, the Land Acquisition Officer has not kept in view the potentiality of the land and prospect for development and the compensation given was meagre amount. 16. Statistics show that most of the acquisitions relate to lands held by small farmers, whose livelihood depends upon the acquired lands. As held by the Supreme Court in (2009) 4 MLJ 137 (SC) [Special Land Acquisition Officer, U.K.Project v. Mahaboob and another], even though the land is taken purportedly in accordance with law by resorting to acquisition proceedings, the Collector is supposed to offer a fair compensation by taking all relevant circumstances relating to market value into account. The Supreme Court further held that the Land Acquisition Officers seldom make reasonable offer and they tend to err on the safer side and invariably assess very low compensation. 17. Even though, based upon Exs.C4 and C5-sale deeds, Reference Court has taken the market value at Rs.20,000/- per cent, but the Reference Court has made 60% deduction for development charges and taken Rs.7447/- per cent. Pointing out that the land owners themselves have asked for only Rs.10,00,000/- per Hectare. There again, Reference Court restricted to Rs.5000/- per cent. We are of the view that the Reference Court was very conservative in fixing the market value at Rs.5000/- per cent. We are of the opinion that Reference Court ought not to have restricted Rs.5000/- per cent. However, since Claimants have not preferred any appeal or Cross- Objection for enhancement, the matter has to be left there. The market value of Rs.5000/- per cent fixed by the Reference Court itself is very low, we find no reason for further deduction. We therefore confirm the market value of the land fixed by the Reference Court at Rs.5000/- with 30% solatium and 12% additional market value for 792 days [19.5.1992 to 29.7.1994]. In so far as interest, Tribunal has awarded interest on the enhanced amount with 30% solatium i.e. at the rate of 9% for one year period from 26.06.1992 and thereafter at 15% p.a. till the date of deposit, the same is also confirmed. In similar acquisition, earlier by common Judgment dated 23.2.2010 in A.S.No.123 of 2007 Batch, the Division Bench of this Court [both of us were Members] confirmed the market value fixed by https://hcservices.ecourts.gov.in/hcservices/ the Reference Court. Hence, we are of the view that it would be appropriate to confirm the market value fixed by the Reference Court and also the other benefits given in its Judgment. 18. The main contention of the learned counsel for Respondents 5 to 9 is that the compensation amount of Rs.89,740/- in respect of S.F.No.324/1A1 – 0.18.0 Hectares had not been deposited by the Land Acquisition Officer before the Reference Court and Claimants 5 to 9 are entitled to Rs.89,740/- with interest at 12% p.a. from 26.06.1992. 19. In Award No.5/1994 dated 29.04.1994, the following lands have been included: "S.F.No.324/1A2, Uppilipalayam village measuring an extent of 0.18.0 Hectares owned by Subbammal, Subbathal, Francis and Chandra. S.F.No.324/1B2, Uppilipalayam village measuring an extent of 0.24.5 Hectares owned by Kappalankarai Gounder and 12 others. During Award enquiry, Subbathal appeared. In the Award dated 29.4.1994, a sum of Rs.2,11,885/- has been awarded as compensation for 0.42.5 Hectares. Respondents 5 to 9 are the legal representatives of deceased Subbathal. 20. As there were varying as to the deposit of the amount, we have called for report from the Reference Court [I Additional Sub- Judge, Coimbatore]. The Principal Subordinate Judge in-charge of I Additional Sub-Court, Coimbatore sent the report which reads as under:- "In both reference comprises two survey numbers which are 324/1A2 and 324/1B2 total award amount of Rs.2,11,885/- for both S.F.Nos. by Referring Officer. But in this court by mistakenly instead of passing entire award amount for enhancement as stated above only for S.F.No.324/1B2 the amount of Rs.1,22,145/- only enhanced for a sum of Rs.5,58,309/- in his order in LAOP. 140/2000 dt. 24.8.2004 and the same is deposited in court by the Referring Officer dated 22.11.2007 in which a sum of Rs.3,72,191/- received by the Advocate onbehalf of Claimant No.2 to 5 on 2.6.2008. Balance amount of Rs.1,86,103/- has been deposited on 28.3.2008 in the Bank by this court. Subsequently a sum of Rs.89,740/- was also deposited by Referring Officer in this court on 12.01.2009. But the said amount was deposited in L.A.O.P.No.141/2000." https://hcservices.ecourts.gov.in/hcservices/ 21. It is clear from the report of the Principal Subordinate Judge, Coimbatore that two references were made – (i) L.A.O.P.No.140/2000 under Sec.30 of L.A. Act and (ii) L.A.O.P.No.141/2000 under Sec.18 of L.A. Act for enhancement of compensation. 22. In both reference comprises two Survey Numbers which are S.F.Nos.324/1A1 – 0.18.0 Hectares and 324/1B2 – 0.24.5 Hectares and the total award amount is Rs.2,11,885/- for both Survey Numbers. But the award amount of Rs.1,22,145/- was deposited only in respect of S.F.No.324/1B2. The amount in respect of S.F.No.324/1A2 [Rs.89,740/-] was not deposited. 23. While enhancing the compensation, Court has also passed the Judgment in enhancing the compensation only in respect of S.F.No.324/1B2 – 0.24.5 Hectares. The enhancement for S.F.No.324/1A2 – 0.18.0 Hectares was not specifically indicated. 24. To put it shortly:- S.F.No. Name of Land owners Amount awarded by Land Acquisition Officer Remarks Enhancement 324/1A2 (1) Subbammal (2) Subbathal (3) A.Francis Xavier (4) V.Chandra Rs.89,740/- Not deposited initially Rs.89,740/- deposited only on 12.01.2009 324/1B2 (1) Kappalankarai Gounder (2) Velumani (3) P.A.Mani (4) Sabastian (5) Krishnan Gutty (6) T.Selvamani (7) R.Mani (8) T.Krishnan (9) Gnanaprakasam (10)Alagupandian (11)P.Selvaraj (12)K.Subramanian (13)K.Selvamani Rs.1,22,145/- Deposited Rs.5,58,309/- Out of which Claimants 2 to 5 have withdrawn Rs.3,72,191/- https://hcservices.ecourts.gov.in/hcservices/ 25. The enhanced amount for S.F.No.324/1A1 – 0.18.0 Hectares, the Respondents 5 to 9 are entitled to Rs.89,740/- which is not said to have been deposited on 12.01.2009 for which Claimants are entitled to interest. The Claimants are also entitled to enhanced compensation along with 30% solatium. 12% additional market value for 792 days [19.5.1992 to 29.7.1994] and interest at the rate of 9%for one year period from 26.06.1992 and thereafter at 15% p.a. till the date of deposit. 26. A.S.No.132/2007 [LAOP.No.141/2000]:- In the result, the appeal is dismissed. Appellant is directed to deposit Rs.89,740/- [which was already deposited] along with the entire amount of enhanced compensation amount plus 30% solatium, 12% additional market value for 792 days [19.5.1992 to 29.7.1994] and interest at the rate of 9% for the entire compensation including Rs.89,740/- for one year from 26.6.1992 and thereafter at 15% p.a. till the date of deposit within a period of eight weeks from the date of receipt of copy of this Judgment. On such deposit, Respondents 5 to 9 are permitted to withdraw their respective share of compensation along with solatium and accrued interest thereon. Consequently, connected all M.Ps. are closed. In the circumstances of the case, there is no order as to costs in this Appeal. Sd/- Asst. Registrar //true copy// Sub Asst.Registrar bbr To 1.The I Additional Sub-Judge, Coimbatore. 2.The Section Officer, V.R.Section, High Court, Madras. 1 cc to Mr.N.Manokaran, Advocate, Sr.No.14295 1 cc to Mr.D.Shivakumaran, Advocate, Sr.No.14173 Judgment in A.S.No.132 of 2007 LA {CO} TP/31.3.2010. https://hcservices.ecourts.gov.in/hcservices/