R.F.A. No. 812 of 2000 [1] IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Date of decision: January 06, 2009 (1) R.F.A. No. 812 of 2000 Baldev Tayal and another .. Appellants v. Haryana State and another .. Respondents (2) R.F.A. No. 486 of 2000 State of Haryana and another .. Appellants v. Kishori Lal (deceased) through LRs .. Respondents (3) R.F.A. No. 487 of 2000 State of Haryana and another .. Appellants v. Nathu Ram .. Respondent (4) R.F.A. No. 489 of 2000 State of Haryana and another .. Appellants v. M/s Surja Ram and Co. .. Respondent (5) R.F.A. No. 490 of 2000 State of Haryana and another .. Appellants v. M/s Bhairon Parshad Mani Ram .. Respondent R.F.A. No. 812 of 2000 [2] (6) R.F.A. No. 491 of 2000 State of Haryana and another .. Appellants v. Baldev Tayal and another .. Respondent (7) R.F.A. No. 813 of 2000 Baldev Tayal and another .. Appellants v. Nathu Ram and others .. Respondents (8) R.F.A. No. 814 of 2000 Baldev Tayal and another .. Appellants v. Kishori Lal through LRs andothers .. Respondents (9) R.F.A. No. 815 of 2000 Baldev Tayal and another .. Appellants v. M/s Surja Ram and Co. and others .. Respondents (10) R.F.A. No. 816 of 2000 Baldev Tayal and another .. Appellants v. Amar Chand and others .. Respondents (11) R.F.A. No. 817 of 2000 Baldev Tayal and another .. Appellants v. M/s Bhairon Parshad Mani Ram and others .. Respondents R.F.A. No. 812 of 2000 [3] (12) R.F.A. No. 2533 of 2000 Nathu Ram .. Appellant v. Haryana State and another .. Respondents (13) R.F.A. No. 305 of 2001 Subhash and others .. Appellants v. Haryana State and another .. Respondents (14) R.F.A. No. 307 of 2001 Surja Ram and Company .. Appellant v. Haryana State and another .. Respondents (15) R.F.A. No. 308 of 2001 Rajinder Parshad .. Appellant v. Haryana State and another .. Respondents CORAM: HON'BLE MR. JUSTICE RAJESH BINDAL Present: Mr. Sudhir Mittal, Advocate for the land owners. Mr. Vinod Gupta, Advocate for the tenants. Mr. Lokesh Sinhal, Additional Advocate General, Haryana for the State. Rajesh Bindal J. This order will dispose of a bunch of 15 appeals, as the same arise out of one acquisition. R.F.A. No. 812 of 2000 has been filed by the land owners seeking further enhancement of compensation. R.F.A. No. 812 of 2000 [4] R.F.A. No. 491 of 2000 is a cross appeal filed by the State seeking reduction of compensation on account of acquisition of land. R.F.A. Nos. 2533 of 2000, 305, 307 and 308 of 2001 have been filed by the tenants seeking further enhancement of compensation for the acquired land, super structure and also impugning the award of the court below, seeking apportionment to the extent of 3/4th as against 1/4th granted to them by the learned court below. R.F.A. Nos. 486, 487, 489 and 490 of 2000 have been filed by the State against the tenants seeking reduction in compensation already granted to the tenants on account of acquisition of land and super structure. R.F.A. Nos. 813 to 817 of 2000 have been filed by the land owners with the permission of this court against the award of the learned court below granting apportionment to the extent of 1/4th share to the tenants. The facts have been extracted from R.F.A. No. 812 of 2000. Briefly, the facts are that vide notification dated 26.7.1975, issued under Section 4 of the Land Acquisition Act, 1894 (for short, `the Act'), land measuring one kanal and one marla situated in the area of Village Hisar, Hadbast No. 146, Tehsil and District Hisar was acquired for development and utilisation as residential and commercial area in the urban estate of Hisar. The same was followed by notification dated 19.6.1978 issued under Section 6 of the Act. The Land Acquisition Collector (for short, `the Collector') determined the market value of the acquired land @ Rs. 100/- per square yard. Aggrieved against the same, the land owners as well as tenants filed objections which were referred to Additional District Judge, Hisar, who keeping in view the material placed on record by the parties, determined the market value of the acquired land at Rs. 1231/- per square yard. The learned court below further directed for payment of compensation to the extent of 50% of the value of the land on account of severance to the landowners. The learned court below assessed the value of the superstructure of the tenants at Rs. 1,00,000/- each. As far as compensation on account of loss of goodwill is concerned, the same was assessed at Rs. 50,000/-, Rs. 50,000/-, Rs. 30,000/- and Rs. 50,000/- for Surja Ram, Nathu Ram, Rajinder Parshad and Bhairon Parshad, respectively. In addition to this, Surja Ram and Nathu Ram were also held entitled to another sum of Rs. 25,000/- each on account of shifting of machinery. It was further directed that there would be apportionment of compensation on account of acquisition of land amongst the landowners and the tenants in the ratio of 3/4th and 1/4th respectively. It is this award of the learned R.F.A. No. 812 of 2000 [5] court below which is impugned by the landowners, the tenants and the State before this court. Learned counsel for the landowners submitted that the jurisdiction vested in the court below while considering a reference under the Act is limited. It cannot go beyond the dispute referred to it by the Collector. In the present case, as is evident from the material on record, the reference at the behest of the tenants was only for their claim regarding super structure, shifting charges of machinery and loss of goodwill, whereas the learned court below, while travelling beyond its jurisdiction has converted the reference under Section 18 of the Act into a reference under Section 30 of the Act for apportioning the compensation payable on account of acquisition of land amongst the land owners and the tenants, whereas no such claim was made before the Collector. This is in spite of the fact that applications filed by the tenants for impleading the landowner as parties in reference filed by them for seeking apportionment of compensation was dismissed, which order was even upheld by this Court. The submission is that the apportionment of compensation as directed by the learned Reference Court is totally without jurisdiction. Reliance was placed upon Custodian, Evacuee Property vs Amarnath and others, AIR 1981 J&K 88; Murti Shree Ram Chander Ji Maharaj vs State of Haryana 1987 PLJ 131; Gopal Singh vs The Land Acquisition Collector and others 1989 PLJ 701 and Babua Ram and others vs State of U.P. and another 1995(2) SCC 689. Learned counsel for the landowners further submitted that even the value of the acquired land as assessed by the learned court below is not in consonance with the evidence produced by them on record. It was a very small portion of land measuring 1 kanal 1 marla, which was acquired. The entire area in the vicinity had already been developed. The land is situated towards the west of Hisar-Delhi road and the same is sandwiched between Loha Mandi and Old Grain Market. It is within the municipal limits where all civic amenities were available. Jambheshwar Market is situated at a distance of 300 yards whereas old court complex was at a distance of 350 yards. He further submitted that the entire area in the vicinity being highly developed, the commercial plots were being sold at exhorbitant prices and the land in question had great commercial potential being situated on main road. Learned counsel for the tenants submitted that the tenants in appeals filed by them are not only claiming enhancement of compensation on account of acquisition of land but also for superstructure. Further enhancement is being sought under various heads like loss of business, goodwill etc. which according to R.F.A. No. 812 of 2000 [6] him has been determined on lower side as compared to the claim made by them. As regards the apportionment of compensation is concerned, learned counsel submitted that the tenants in the present case were in possession of the land for the last about 30-35 years. Accordingly, the apportionment only to the extent of 1/4th granted by the learned court below deserves to be enhanced to 3/4th. On the other hand learned counsel for the State while objecting to the claim made by the landowners as well as the tenants seeking further enhancement on account of acquisition of land and also the superstructure submitted that the compensation as has been determined by the learned court below is much more than what the landowners and the tenants deserved. He submitted that the basis which was adopted by the learned court below for determination of compensation is not in conformity with law. As far as the claim of damages is concerned, the submission is that the same is not made out at all from the material placed on record as left out strip of land is abutting the main road whereas it is only the rear portion which is acquired. There is no bifurcation as such, as a result of the acquisition. As regards the compensation determined on account of acquisition of superstructure, and also loss of business, goodwill to the tenants, the submission is that there is no material on record and in fact there is no discussion in the impugned award of the learned court below as to on what basis the amount has been determined. There is clear discrepancy in the amount claimed by the tenants in the objection petition and the evidence led in the court which was merely a bald statement with no corroborating statement. In the absence thereof, the amount of compensation as has been directed to be paid to the tenants deserves to be reduced. Considering the pleadings and the arguments raised by learned counsel for the parties, in my opinion, the following issues are required to be determined in the present set of appeals:- 1) Whether the fair value of the acquired land as determined by the learned court below deserves interference by this court by way of reduction or increase ? 2) Whether the learned court below was right in granting compensation @ 50% of the value on account of damages for severance? 3) Whether the amount of compensation assessed on account of value of superstructure, loss of goodwill and the shifting charges of machinery, as granted to the tenants deserves interference by this court by way of reduction or increase ? R.F.A. No. 812 of 2000 [7] 4) Whether the tenants are entitled to apportionment of compensation on account of acquisition of land which was under their occupation ? In case answer to this question is yes, then as to whether they are entitled to compensation @ 1/4th or more ? Question No. 1 . A perusal of the award of the Collector shows that in response to the notice issued under Section 9 of the Act, the land owners filed objections claiming compensation @ Rs. 1,000/- per square yard, but as is mentioned in the award of the Collector, no evidence was produced in support thereof. It has come on record in the evidence led by the landowners that the acquired land is situated on West side of Hisar-Delhi Road and sandwiched between Loha Mandi and Old Grain Market. All civic amenities such as water supply, sewerage, electricity and telephone were available around the acquired land, which was located within the municipal limits. Court complex was merely at a distance of 350 yards. The commercial area was not at a far off place. The learned court below assessed the market value of the land referring to the basis which was adopted by the Collector for determination of value of the acquired land. The Collector assessed fair value of the acquired land at Rs. 100/- per square yard relying upon his earlier award no. 26 dated 27.3.1976 pertaining to the land situated on Hisar-Rajgarh Road which was acquired vide notification dated 20.8.1975. The acquisition in the present case was made vide notification dated 26.7.1975. The market value in the relied upon award was assessed at Rs. 65/- per square yard. Considering the location and potential of the acquired land, the same was assessed at Rs. 100/- per square yard. The value of the land which was acquired vide notification dated 20.8.1975 and was subject matter of award dated 27.3.1976 was determined by this court at Rs. 800/- per square yard vide judgment dated 31.10.1989 in R. F. A. No. 2019 of 1979 -Miss Niropana Jain vs The State of Haryana and another (Ex. P10). Relying upon and granting the proportionate increase as was the difference in both the awards of the collector, the learned court below assessed the value of the acquired land at Rs. 1231/- per square yard. Further reference was also made to the plots sold by HUDA in the vicinity of the acquired land and the acquired land also being small piece measuring 1 kanal 1 marla. Considering the facts and also the method which was applied by the learned court below for determination of fair value of the acquired land, I do not find any reason to interfere therewith. Accordingly, the value of the acquired land as determined by the learned court below is upheld. R.F.A. No. 812 of 2000 [8] Question No. 2 As regards the grant of damages on account of severance is concerned, the learned court below has discussed the same in paras 40 to 43 of the impugned award. The claim of the landowners was that under clause 'thirdly' the landowners were entitled to grant of compensation on account of damages sustained for the reason of acquisition of land @ 50% of the market value. After noticing the fact that the claim was not disputed, the learned court below granted 50% of the market value under clause 'fourthly' of Section 23 of the Act. As is noticed in the impugned award, the landowner owned 2 kanals 1 marla of land i.e. 1240.25 square yards. Out of that 635.25 square yards was acquired and the remaining left out area was 605 square yards. The claim was sought to be made for severance or damages under clause 'thirdly' of Section 23 of the Act on the ground that the front portion having been acquired, the rear portion could not be properly utilised. Further the learned court below while granting 50% had referred to clause 'fourthly' of Section 23 of the Act. Site plan Ex. P1 and Akshajra Ex. P12 in Land Reference No. 411-LA of 1995, show the area of the acquired land and its location. It is arrow like shape, a small strip of land which as per Ex. P-1 is 361 feet in length and 25' 9 '' feet in width on one end and the other end is like a tip of an arrow. Akshajra Ex. P-12 depicts khasra numbers of small portions of land which were acquired. As per the facts contained in para 40 of the impugned award 11 marlas of land comprised in khasra no. 2362/1 and 10 marlas of land out of khasra no. 2384/1 totaling 1 kanal 1 marla had been acquired. A perusal of akshajra Ex. P-12 shows that it is the upper portion of the land which was acquired. The upper portion, in fact, also matches with the description as is shown in the plan Ex. P-1. The manner in which it has been located on the site plan shows that it is the right portion of the land which has been left out of acquisition. If both the plans are considered, it can very well be opined that portion which has been left out of acquisition abuts the main road and it is not that land abutting the main road had been acquired rather it is rear portion which has been acquired. Even otherwise, there is no reason in acquiring the small strip of land on the main road and leaving a small strip behind that which is adjoining the already developed market. Even if the left out area is on the back side, the land owners having been compensated for the acquired portion adequately, it cannot be said that the value of the land which has been left out on the side of the already developed market is affected adversely so as to justify claim of damages. Considering both site plans on record as mentioned above, I do not find that the landowners in the present case are entitled to any compensation on account of R.F.A. No. 812 of 2000 [9] damage allegedly suffered by them as it is not evident from the site plans on record and there is no other evidence referred to by the landowners to substantiate and justify the award of the learned court below on that account. No reasons are forth coming on record as to why small strip of land was acquired and another small strip was left out of acquisition when all other area in the vicinity had already been acquired. For the reasons mentioned above, in my opinion, grant of compensation on account of damages to the landowners to the extent of 50% of the market value is not justifiable. Accordingly, the impugned award to that extent is set aside. Question No. 3. A perusal of the material placed on record by the tenants in the form of objections filed before the Collector and the petitions before the Reference Court, it is evident that the claim was made to the tune of Rs. 67,000/-, Rs. 55,000/-, Rs. 57,000/- and Rs. 45,500/- by Surja Ram, Bhairon Parshad, Nathu Ram and Rajinder Parshad, legal representative of Kishori Lal respectively, the details on account of which the claim was made have been referred to in paragraph 4 of the judgment. As against this, the Collector assessed the compensation payable to the tenants at Rs. 8,000/-, Rs. 15,000/-, Rs. 5,000/- and Rs. 7,000/-, respectively. In addition to this, compensation was also held payable on account of labour and carriage charges for shifting and loss of goodwill. The following table will show the amount of compensation, as demanded by the tenants in the claim originally filed before the Collector, and the amount assessed and paid to them: “Sr. Name of tenant Details of claims Value assessed Compensation awarded by the Collector. Amount in rupees ............................................................................................................................................... 1. Surja Ram Bricks etc. carriage, 15,000/- 2300/- 8,000/- Labour charges 7,000/- and goodwill 45,000/- 2. Sh. Bhairon Bricks etc. 22,000/- 3760/- 15,000/- Parshad (since deceased) Labour charges 2,000/- Carriage of goods 4,000/- Goodwill 25,000/- 3. Sh. Nathu Ram Bricks etc. 10,000/- 1300/- 5,000/- Carriage and Labour 7,000/- charges Goodwill 40,000/- 4. Sh. Kishori Lal Bricks etc. 15,000/- 2100/- 7,000/- Labour Charges 3,000/- Carriage of goods Good will 25,000/- R.F.A. No. 812 of 2000 [10] The claim in the objections filed before the Reference Court by tenant-Surja Ram and Company was in the following terms: “ Current construction cost Rs. 75,000/- (which was Rs. 15,000/- in 1967) Machinery Rs. 75,000/- Loss of goodwill Rs. 45,000/- Shifting of business Rs. 50,000/- Total: Rs. 2,45,000/-” The claim in the objections filed before the Reference Court by tenant- Bhairon Parshad was in the following terms: “(a) Cost of bricks and other building materials like timber, cement, iron, stone etc. Rs. 30,000/- (b) Goodwill of the shop Rs. 20,000/- (c) Shifting charges Rs. 5,000/- Total: Rs. 55,000/-” The claim in the objections filed before the Reference Court by tenant-Nathu Ram was in the following terms: “(a) Cost of bricks and other building Rs. 10,000/- materials like timber, cement, iron, stone etc. (b) Saw mills and trolley saw mill with 10 H.P. Electric motor and wood turning machine Rs. 25,000/- (c) Labour charges of construction of building, platform and fitting of machines Rs. 7,000/- (d) Good will Rs. 38,000/- (e) Shifting charges Rs. 10,000/- .................. Grand total: Rs. 90,000/-” The claim in the objections filed before the Reference Court by tenant- Kishori Lal was in the following terms: “(a) On bricks and other building materials, i.e., timber, iron bajri, cement and Reti etc. Rs. 15,000/- (b) Labour charges: Rs. 3,000/- While leading evidence before the court below, the tenants sought to exaggerate their claim pertaining to acquisition of super structure etc. B.D. Singh, Valuer, was produced as PW-9 who proved Ex. P.26, Ex. P29 and Ex. P30 as R.F.A. No. 812 of 2000 [11] valuation reports regarding super structure pertaining to Surja Ram, Nathu Ram and Rajinder Parshad, respectively. Valuation report (Ex. P32) was produced regarding super structure pertaining to Bhairon Parshad. Merely on that basis and without referring to the claim originally made by the tenants in the claim petitions/objections before the Collector in response to the notice issued under Section 9 of the Act, the learned court below assessed the value of the property of the tenants at Rs. 1,00,000/- each. As far as compensation on account of loss of goodwill is concerned, the same was assessed at Rs. 50,000/-, Rs. 50,000/-, Rs. 30,000/- and Rs. 50,000/- for Surja Ram, Nathu Ram, Rajinder Parshad -legal representative of Kishori Lal and Bhairon Parshad, respectively. In addition to this, Surja Ram and Nathu Ram were also held entitled to another sum of Rs. 25,000/- each on account of shifting of machinery. Aforesaid facts clearly establish that what the learned court below had granted was much much more than the claim made by the tenants originally with regard to super structure, shifting charges or goodwill. In fact, it was a clear case of non-consideration of material evidence on record which had resulted in the findings being recorded on that issue being perverse. Not only this, a perusal of the impugned award shows that there is no reason given therein as to on what basis the assessment was made by the learned court below under various heads. The evidence produced by Surja Ram in support of his claim on account of superstructure, loss of goodwill and shifting charges is in the form of valuation report Ex. P-26 which is as under:- “Part-II Valuation of property. Area of construction 40'x25.5' = 980 sq. ft. @ Rs. 200/- 1,96,000 of building with rafters sq. ft on roof deduct depreciation of 34 years 66,440 @ 1% per year _____________ Net: 1,29,560 Add depreciation and shifting of machinery such as 90,000 saw machine, grinders, meter shifting and transportation of material etc. Add goodwill of the shop 65,000 _____________ 2,74,560 Say Rs. 2,74,000” R.F.A. No. 812 of 2000 [12] The valuation report with regard to the claim of Sri Nathu Ram on account of superstructure, loss of goodwill and shifting charges is in the form of valuation report Ex. P-29 which is as under:- “Part-II Valuation of property. Area of construction 11''x16' = 176 sq. ft. including bricks, 17'x16' = 272 sq. ft. cement, timber etc. 24'x13' = 312 sq. ft. 760 sq. ft. @ 200/- 1,52,000 per 100 sq. ft. Deduct depreciation of 34 years 51,680 @ 1% per year _____________ Net: 1,00,320 Add goodwill 50,000 Shifting of machinery & depreciation 50,000 including shifting of electric motor and other material. _____________ Total 2,00,320 Say Rs. Two lacs only. ” The report with regard to the claim of Rajinder Parshad son of Kishori Lal on account of superstructure and loss of goodwill is in the form of valuation report Ex. P-30 which is as under:- Part-II Valuation of property. Area of construction 31''x 22' = 682 sq. ft. @ Rs. 200/- 1,36,400 of building with wooden per sq. ft. rafters with cost of bricks, timbers etc. Deduct depreciation for 34 years 46,376 @ 1% per year _____________ Net: 90,024 Add goodwill 35,000 Total 1,25,024 Say Rs. One lac & twenty thousands only. The report with regard to the claim of Bhairon Parshad on account of acquisition of superstructure is in the form of valuation report Ex. P-32 which is as under:- Total cost. 1. cost