IN THE HIGH COURT OF JUDICATURE AT PATNA FA No.399 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus RAM SHANEHI SINGH with FA No.400 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus RAM CHANDRA RAM with FA No.401 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus SHEO PUJAN SINGH with FA No.402 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus SHEO NARAYAN SINGH with FA No.403 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus AMARDEO SINGH with FA No.404 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus DINA SINGH with FA No.405 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus RAMASHRAYA SINGH & ORS with FA No.406 of 1997 2 STATE OF BIHAR THROUGH THE COLLECTOR Versus RAMASHRAYA SINGH with FA No.408 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus NAGESHWARI DEVI with FA No.409 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus BRIJ NANDAN PRASAD with FA No.411 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus JANAKDEO SINGH with FA No.412 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus PARASH NATH SINGH & ORS with FA No.413 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus SATYA NARAYAN SINGH with FA No.414 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus RAM SIGHASAN SINGH with FA No.444 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus 3 BISHWANATH YADAV & ORS with FA No.428 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus RAM JANAM SINGH with FA No.467 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus JAI MATIYA DEVI @ JAIMATIYA with FA No.425 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus MURLI SINGH with FA No.465 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus SMT.TETRI DEVI with FA No.460 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus RAM CHANDRA SINGH with FA No.461 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus LALITA DEVI @ LALITA with FA No.469 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus SHEO PUJAN SINGH with FA No.436 of 1997 4 STATE OF BIHAR THROUGH THE COLLECTOR Versus NATHUN THAKUR & ANR with FA No.434 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus RAM PUKAR SINGH with FA No.454 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus SITA DEVI with FA No.427 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus ANUP KUMAR SINGH & ANR with FA No.423 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus MOHAN PRASAD SINHA & ANR with FA No.470 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus SMT.JAIMATIA DEVI with FA No.453 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus HIRDAYA DEVI with FA No.439 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus MADHESHWAR SINGH 5 with FA No.437 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus KARAMDEO SINGH with FA No.446 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus SUDHAN CHAMAR with FA No.432 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus SMT.SHANTI DEVI with FA No.451 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus SUMITRA KUER with FA No.443 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus MUNGA DEVI with FA No.459 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus MANWAJ DEVI with FA No.424 of 1997 STATE OF BIHAR THROUGH THE COLLECTOR Versus RAM SIGHASHAN SINGH with FA No.471 of 1997 6 STATE OF BIHAR THROUGH THE COLLECTOR Versus AHILYA DEVI ----------- J U D G E M E N T (28/4/2010) Dipak Misra, C.J. In this batch of appeals preferred under section 54 of the Land Acquisition Act, 1894, the challenge is to the award dated 2nd June, 1997 passed by the Reference Court in Land Acquisition Reference Case no.33 of 1990. 2. The facts which are necessary to be stated for adjudication of this batch of appeals are that a notification under section 4(1) of the Land Acquisition Act, 1894 (for short, „the Act‟) was issued for acquisition of land situate in mauza Dhaboul in the district of Aurangabad. As is evident from the material brought on record, the Land Acquisition Officer- cum-Collector under the Act awarded compensation of Rs.30,000/- per acre in respect of land situate in mauza Dhaboul. On an application preferred under section 18 of the Act, the Land Acquisition Collector preferred the matter to the Civil Court and, as is evincible from the award, the Reference Court enhanced the valuation to Rs.1,55,600/-. 3. It is worth noting, the Reference Court has passed two awards one in LA. Case no.33 of 1990 and another in LA Case no.60 of 1990. LA. Case no.33 of 1990 relates 7 to mauza Dhaboul and LA Case no.60 of 1990 pertains to mauza Jasoiya. Be it noted, the said land acquisition cases were disposed of by a common order and the main order was passed in LA Case no.1 of 1990. 4. The notification issued in the year 1987 was for the purpose of acquiring land admeasuring 233.62 acres falling in three villages, namely, Majurhi, Jasaiya and Dhaboul for construction of Aurangabad Development Centre under the Scheme for the benefit of the Bihar Industrial Area Development Authority, Patna (for short, „the BIADA‟). 5. It is worth noting, the said authority, namely, the BIADA submitted an application in this appeal and was arrayed as a co-appellant along with the State. 6. Though initially a submission was canvassed by Mr. Lalit Kishore, learned senior counsel appearing for the BIADA, that the matter should be remitted to the Reference Court in view of the decisions rendered by the Apex Court in U.P.Awas Even Vikas Parishad v. Gyan Devi, (1995) 2 SCC 326, Abul Razzak v. Kerala Water Authority, (2002) 3 SCC 228, and the order passed by the Apex Court in Civil Appeal no.2780 of 1998, yet eventually a consensus was arrived at that the matter should be heard on merits inasmuch as in some cases the matter was earlier remanded and the Reference Court has 8 reiterated the award. Thus, I proceed to deal with the appeal on merits. 7. Heard Mr. Sanjay Kumar, GP XIV, Mr. Harendra Pd. Singh, GA VI, Mr. Anil Kumar Jha, GA II, Mr. P. Tekriwal, GA 1, Mr. Narmedeshwar Jha, AAG VII, and Mr. Ram Bilash Mahto, AAG VIII, learned counsel for the appellant, Mr. Lalit Kishore, learned senior counsel, along with Mr. Mukul Prasad, learned counsel for the BIADA, and Mr. D.K.Sinha, learned senior counsel, along with Mr. Anirudha Kumar Verma, and Mr. Virendra Kumar Singh, learned counsel for the claimant – respondents. 8. Before I proceed to deal with the rivallised contentions raised at the Bar, I think it condign to refer to certain pronouncements which ought to be borne in mind while dealing with a case for grant of compensation pertaining to acquisition of land. 9. In Ahmedabad Municipal Corporation and others v. Shardaben and others, (1996) 8 SCC 93, the Apex Court expressed the view that burden is always on the claimants to prove by adducing reliable evidence that the compensation offered by the Land Acquisition Officer is inadequate and lands are capable of fetching higher market value. It is the duty of the court to closely scrutinize the evidence, apply 9 the test of a prudent and willing purchases i.e., whether he would be willing to purchase in open and normal market conditions of the acquired land and then to determine the just and adequate compensation. 10. In Hookiyar Singh and others v. Special Land Acquisition Officer, Moradabad and another, (1996) 3 SCC 766 their Lordships expressed the view that the Court must not indulge in feats of imagination but , sit in the armchair of a prudent purchaser and put a question to itself whether as a prudent purchaser it would offer the same price in the open market as is to be determined. 11. In State of U.P. and others v. Ram Kumari Devi (Smt.) and others, (1996) 8 SCC 577, the Supreme Court ruled that when 13.75 acres of land was offered for sale in an open market, no prudent man would have credulity to purchase the land on square foot basis. Similar view was taken in the case of Gujarat Industrial Development Corporation v. Narrottambhai Morarbhai and another, (1996) 11 SCC 159. 12. Yet in another decision rendered in the case of G. Narayan v. Land Acquisition Officer, (1996) 10 SCC 607 it was ruled that it must be established, as a fact, that the potential purpose does exist on the date of notification, the prevailing conditions in the market, the existence of the 10 construction of building activities in the neighbourhood and that other lands in the adjacent neighbourhood possessed similar conditions. 13. In Kanwar Singh and others v. Union of India, (1998) 8 SCC 136 it has been expressed that the amount of compensation for the land acquired depends on the market value of the land on the date immediately before the notification under Section 4 of the Act or when same land is acquired and offer of compensation is made through an award. In the aforesaid case, it was ruled that the consideration in terms of the price received for land under bonafide transactions on the date or preceding the date of notification issued under Section 4 of the Act generally shows the market value of the acquired land and the market value of the acquired land is to be assessed in terms of those transactions. For attracting the conception of future potentiality of the land, location of the land cannot be ignored as has been held in the case of Hasan Ali Walimchand (dead) by LRs v. State of Maharashtra, (1998) 2 SCC 388. 14. In this context we may refer with profit to the decision rendered in the case of Land Acquisition Officer Revenue Divisional Officer, Chitor v. L. Kamalamma (Smt) dead by LRs and others K.Krishnamachari and others, (1998) 2 SCC 385 wherein it has been held that when no sales of 11 comparable land are available where large chunks of land had been sold, even land transaction in respect of smaller extent of land could be taken note of as indicating the price that it may fetch in respect of large tracts of land by making appropriate deductions such as for development of the land by providing enough space for roads, sewerage, drains, expenses involved in formation of a layout, lump sum payment as also the waiting period required for selling the sites. 15. In Kasturi and others v. State of Haryana, (2003) 1 SCC 354 it has been opined that there is a difference between a developed area and an area having potential value, which is yet to be developed and 20% deduction towards development charge as against the normal 1/3rd form the amount of compensation would be regarded as justified. 16. In the case of Ahad Brothers v. State of M.P. and another, (2005) 1 SCC 545, the Apex Court has expressed the view as under:- “ 13. The Reference Court as well as the High Court both have concurrently held that the land acquired, through was an agricultural land, was not being used for agricultural purpose as on the date of issuing Section 4 (1) notification and it had potentialities for the purpose of creating building sites. The Reference Court was right in determining the market value of the land acquired @ Rs. 2/- per Sq. ft. but it committed an error in not giving any deduction towards development charges. In our view, having regard to the location and surroundings of the acquired land, as already indicated 12 above, it would be just and appropriate to deduct 30% towards developmental charges out of the amount of compensation payable to the appellant @ Rs.2/- per sq. fit. 14. In view of what is stated above, the impugned judgment and order cannot be sustained. The impugned judgment is modified awarding the compensation to the appellant as owner of the land acquired @ Rs.2/- sq. fit., after deducting 30% of the market value of the land calculated on the basis of Rs.2/- sq. fit. The appellant is also entitled to all the statutory benefits on the amount of compensation so determined. The appeal is disposed of accordingly. No costs.” 17. In Shardamma v. Special Land Acquisition Officer and another, 2007 AIR SCW 1109, a two- judge bench of the Apex Court taking note of the fact that the acquired land was surrounded by factories and there was industrial potentiality and the land acquired was adjoining the national highway and better located fixed the compensation at the rate of Rs.20/- per square yard. 18. In Land Acquisition Officer A.P. v. Kamandana Ramakrishna Rao and another, 2007 AIR SCW 1745 the Apex Court while dealing with the issue of compensation determined on yield basis observed that the Court is not precluded from taking into consideration factors such as potentiality and utility of land. 19. In the case at hand the claimants brought on record the documents that the land in question situate adjacent to Aurangabad Town and on one side of the land there 13 is Karma road and Aurangabad-Patna road is on the other side. It was stated that it is situated adjacent to Aaurangabad Police Line, Electricity Office, Anugrah Inter College, Block Development Officer‟s Office, Collectorate and other Government Offices. It was contended that the market value of land at the time of notification, that is, 30th June, 1987 was approximately 4000/- per decimal and the other land similar to the acquired land was sold at Rs.1600/- per decimal. It was also contended that the acquired land was homestead, yet the same was used for agricultural purposes and yielding good crops. The emphasis was laid on the development of Aurangabad Town and commercial facilities. 20. It is apt to note, the State of Bihar did not file any written statement to justify the award passed by the Land Acquisition Collector. 21. Eighteen witnesses were examined and number of documents were executed. Ext. 1 is the registered sale deed dated 3.3.1986 executed in respect of 31 ½ decimals of land bearing plot no.22 situate in village Dhaboul for a consideration of Rs.49,000/-. Ext. 1/a is another registered sale deed dated 14.3.1986 executed for a consideration of Rs.49,000/- in respect of 31 ½ decimals. Ext. 1/b, the sale deed dated 14.7.1987 in respect of 1 kattha, was executed for a consideration 14 of Rs.10,000/-. Vide Ext. 1/d a sale deed was executed on 6.3.1986 for a consideration of Rs.7500/- in respect of five decimals of land. Certified copies of the judgments in Land Acquisition Case nos. 58 of 1990 & 19 of 1990 were marked as Exts. 4 & 4/a. 22. On behalf of the State though no written objections were filed, yet certain witnesses were examined and documents were exhibited. Ext.B is the valuation khatiyan and Ext.C is the sale chart prepared by the department. According to Ext. C, the value of the land is Rs.45000/- per acre on the ground that the sale chart was inconsequential inasmuch as the entry made in the said chart was of a land situate at a distance from the land in question. 23. Learned counsel for the claimants placed reliance over Exts.1, 1/a and 1/d which were contemporaneous sale deeds, the proximity to the road, the nature of the land, that is, homestead and the factum, that is, adjacent to the Government Offices and justified the claim for compensation. 24. On behalf of the State, it was contended that it was a ditch and not a homestead land and the price of the land was rightly determined by the Land Acquisition Officer. Reference Court relying on the oral evidence of the 15 claimants recorded a finding that the land was not a ditch though it was used for agricultural purposes and perused the map, from which it was manifested that the entire plot no.22 was sold in the year 1986. He took note of the fact that 31 decimals of land of that plot was sold for a consideration of Rs.49000/- and five decimals of that plot was sold for Rs.7500/- in the same year. 25. Be it noted, the claimants placed heavy reliance on Exts. 1/c and 1/b by which 1 kattha land was sold for Rs.10,000/-. The deeds were contemporaneous in nature and regard being had to the situation of the land, the Reference Court determined the price of the land Rs.1,55,600/- per acre. Thus, the Reference Court has taken note of the sale price for 31 decimals of land which is almost 1/3rd of an acre and the sale deed by which 1 kattha (equivalent to 3 decimals) was sold for Rs.10,000/-. 26. Regard being had to the prevailing conditions at the time of notification, the contemporaneous sale deeds, the future potentiality of the land, the nature of the sale deed, the surrounding areas, I am of the view that the determination made by the Land Acquisition Officer cannot be found fault with and the priced fixed for the land is in accord with the concept of credibility of a prudent purchaser to purchase the 16 same, apart from other aspects, which are to be taken into consideration at the time of determination of compensation. 27. In view of the foregoing analysis, I do not perceive any merit in these appeals and, accordingly, they are dismissed without any order as to costs. Neyaz/ ( Dipak Misra, CJ.)