IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA RFA Nos. 347 of 2006 and 350 of 2006. Date of decision: 27.5.2008 RFA No. 347 of 2006 Collector Land Acquisition and another. Appellants. Versus Narin Singh and others Respondents. RFA No. 350 of 2006 Collector Land Acquisition and another. Appellants. Versus Jai Wanti and others Respondents. Coram The Hon’ble Mr.Justice Deepak Gupta, J. Whether approved for reporting?1 No. For the appellants: Mr. Vivek Singh Thakur, Additional Advocate General. For the respondents Mr. G.R. Palsra, Advocate. Deepak Gupta, J. (oral) This judgement shall dispose of aforesaid two Regular First Appeals as they arise out of the common award passed by the learned District Judge, Mandi, H.P. on 18.11.2005. Briefly stated, the facts of the case are that the appellants-State issued notification under Section 4 of 1 Whether the reporters of the local papers may be allowed to see the Judgment? Yes. the Land Acquisition Act on 24.2.1990 proposing to acquire the land of the land-owners. After notifications were issued under Section 6 and 9, an award was passed by the Land Acquisition Collector on 27.2.1993. The Land Acquisition Collector assessed the value of the land as follows:- Barani Aval Rs.5590.70 Kharatar and Gair Mumkin Rs.906.60 Aggrieved by the award, the land owners filed reference petitions under Section 18 of the Land Acquisition Act, which reference petitions have been decided by the learned District Judge, Mandi. The learned District Judge vide his impugned order has enhanced the compensation in respect of Barani Aval to Rs.13,500/- per bigha and Kharatar and Gair Mumkin to Rs.2700/- per bigha. He has also awarded solatium at the rate of 30% and additional compensation from the date of notification under Section 4 to the date of award. However, he has wrongly mentioned the date of notification as 6.7.1996 whereas in fact date of notification is 24.2.1990 and the award of the learned Tribunal was passed on 27.2.1993. The learned Reference Judge has also awarded interest under Section 28 at the rate of 9% per annum for one year and thereafter at the rate of 15% per annum with effect from 1977, that is the time when the possession of the land was taken over. I have heard Shri Vivek Singh Thakur, learned Additional Advocate General on behalf of the State and Shri G.R.Palsra, learned counsel for the respondents. There are basically two contentions raised on behalf of the State. First is that the learned District Judge has not properly valued the land. The second contention is that the learned District Judge gravelly erred in awarding interest under Section 28 from 1977. Shri Vivek Singh Thakur, learned Additional Advocate General contends that interest could have been awarded only from the date of notification under Section 4 and not from an earlier date. On the other hand, Shri G.R.Palsra, learned counsel for the respondents has pointed out that the learned District Judge has apparently committed an error in mentioning date of notification i.e. 6.7.1996, whereas the notification under Section 4 of the Land Acquisition Act was issued on 24.2.1990. As far as the assessment of the value of land is concerned, the learned District Judge has relied only on the sale deed Ext.PA. The learned District Judge has recorded in his award that 10-8-18 bighas of land was sold by Paras Ram to Mani for consideration of Rs.28,000/- on 3.4.1987. This land is recorded as Kharaitar and value thereof comes to Rs.2,700/- per bigha. As far as Barani Aval land is concerned, the learned District Judge has not relied upon sale deed Ext.PB, whereby 2 biswas and 3 biswansee of land were sold for Rs. 1500/- (value per bigha works out to Rs.15,000/- per bigha). He, however, came to the conclusion that the value of Barani Aval land would be atleast five times to the value of Kharaitar land and therefore, awarded Rs.13,500/- per bigha. In my view, the learned District Judge has not at all properly taken into consideration the factors which should weigh with the Court while determining the market value of the land. The market value cannot be determined at the whim and fancy of the Court. There is no explanation as to how the learned District Judge came to the conclusion that the value of the Barani Aval land is about five times more than that of Kharaitar land. In case, he was to rely upon the award of the Collector in this behalf then the Barani Aval is more than six times valuable then Kharaitar land. As per the sale deed Ext.PB is concerned the value works out to approximately Rs.15,000/- per bigha. This sale was made in the year 1984 and the land of the petitioner was acquired in 1990. Taking into consideration the prevailing circumstances, it can easily be assumed that the value of the land in these six years would have increased at least by 50% i.e. to Rs.22,000/- per bigha. Keeping in view the fact that by Ext.PB a small piece of land was sold, 40% deduction can be made and the value therefore comes out to Rs.13,500/- per bigha. Therefore, for the reasons totally different than those given by the learned District Judge, I uphold the award in so far it relates to the determination of the market value of the land. However, as far as additional compensation payable under Section 23(1)(A) and interest under Section 28 are concerned the award is incorrect. The land-owners were entitled to additional compensation w.e.f. 24.2.1990, i.e. the date of notification under Section 4 till the date of award i.e. 27.2.1993. As far as interest is concerned the Hon’ble Apex Court in R.L.Jain (D) by LRs. Vs. DDA and others (2004) 4 SCC 79, has clearly held that where possession is taken earlier and the notification under Section 4 of the Act is issued subsequently the additional sum of compensation at the rate of 12% per annum would be payable only from the date of notification and not from the period anterior to the publication of the notification. The Court also held that the interest under Section 28 and 34 of the Act is payable only from the date of notification and not from the date of possession. In para-18, the Court observed as follows:- “18. In case where the landowner is dispossessed prior to the issuance of preliminary notification under Section 4(1) of the Act the Government merely takes possession of the land but the title thereof continues to vest with the landowner. It is fully open for the landowner to recover the possession of his land by taking appropriate legal proceedings. He is, therefore, only entitled to get rent or damages for use and occupation for the period the Government retains possession of the property. Where possession is taken prior to the issuance of the preliminary notification, in our opinion, it will be just and equitable that the Collector may also determine the rent or damages for use of the property to which the landowner is entitled while determining the compensation amount payable to the landowner for the acquisition of the property. The provisions of Section 48 of the Act lend support to such a course of action. For delayed payment of such amount appropriate interest at prevailing bank rate may be awarded.“ This view has been reaffirmed in Land Acquisition Officer and Assistant Commissioner and Another vs. Hemanagouda and others (2005) 12 SCC 443, wherein the Apex Court set aside the judgement of the High Court and held that no interest on the awarded amount was payable under Section 34 of the Act in respect of possession taken prior to notification under Section 4(1). In view of the aforesaid law, the landowners are entitled to interest @ 9% per annum w.e.f. 28.2.1993 (the date of award, for the period of one year till 27.2.1994) and thereafter at the rate of 15% per annum till payment/deposit of the entire award/enhanced amount. Both the appeals are disposed of in the aforesaid terms. CMP Nos.514 of 2008 and 515 of 2008 The amount lying deposited in the Registry of the Court is remitted to the Court of the learned District Judge, Mandi, who shall on application of the parties pass order regarding release/refund of the amount in terms of the above judgement. CMPs are accordingly disposed of. 27th May, 2008 (Deepak Gupta), J. ™