:1: IN THE HIGH COURT OF BOMBAY AT GOA FIRST APPEAL NO. 189 OF 2004 1. Deputy Collector ( L. A.) Margao Goa. 2. The Executive Engineer, W.D. XIV (NH), P.W.D., Fatorda, Margao Goa. ... Appellants V e r s u s 1. Shri Suresh Datta Prabhu Gaonkar, 2. Smt. Padmavati Prabhu Gaonkar, 3. Shri Venkatesh Datta Prabhu Gaonkar, 4. Smt. Kesar V. Prabhu Gaonkar, All residing at Kazelkar, Loliem, Canacona Goa. 5. Smt. Sushila Yeshwant Pai, 6. Shri Yeshwant Govind Pai (expired) leaving behind his following heirs: a) Shri Prashant Yeshwant Pai. b) Shri Jagdish Yeshwant Pai. c) Shri Jaganath Yeshwant Pai. All r/o Mokhard, Canacona, Goa. 7. Shri Srikant Datta Prabhu Gaonkar, 8. Smt. Sandhva Srikant Prabhu Gaonkar, 9. Smt. Sudha Suresh Prabhu Gaonkar, All residing at Kazelkar, Loliem, Canacona Goa. .... Respondents Ms. S. Mordekar, Additional Government Advocate for the Appellants. Mr. Umesh Khot, Advocate for the Respondent Nos. 1 to 5. :2: CORAM : F. M. REIS, J. DATE : 1 st OCTOBER, 2010. ORAL JUDGMENT : The above Appeal takes exception to the judgment and award dated 29th December, 2003 passed by the Additional District Judge, South Goa, Margao, in Land Acquisition Case No. 19/2002. The Appellants had acquired a portion of the land admeasuring 880 square metres from the property surveyed under No. 280/12 of Village Loliem for the purpose of improvement and widening of national highway (additional area ) pursuant to a notification under Section 4 of the Land Acquisition Act, 1894 ( hereinafter referred to as the said Act ) dated 22nd January, 1991 which was published in the Official Gazette dated 21st March, 1991. The Land Acquisition Officer by an award passed under Section 11 of the said Act dated 29th July, 1994 fixed the compensation for the land acquired at the rate of Rs.4/- per square metre. Being dissatisfied with the said amount, the Respondents sought a reference under Section 18 of the said Act for enhancement of compensation and claimed a compensation for the land acquired at the rate of Rs.250/- per square metre. The Respondents also claimed that they are entitled to Rs. 1,34,200/- towards the value of the existing trees. By a judgment and award dated 29th December, 2003 the Reference Court partly allowed the said reference and fixed the market value of the acquired land at the rate :3: of Rs.28/- per square metre. The remaining claim of the Respondents came to be rejected. 2. Being aggrieved by the said judgment and award, the Appellants have preferred the present Appeal. The leaned Additional Government Advocate for the Appellants has assailed the impugned judgment and submitted that there is no evidence on record to substantiate the claim of the Respondents for enhancement of the compensation. She further pointed out that the sale instance relied upon by the Reference Court is not at all comparable to the land acquired. The learned Counsel further submitted that the land which was acquired is in village and in rural area and as such giving escalation of 10% on cumulative basis could not arise at all. The learned Counsel further submitted that the land acquired is within the road widening area. She as such submitted that the Appeal deserves to be allowed and the impugned judgment of the Reference Court be quashed and set aside. 3. On the other hand, the learned Counsel for the Respondents has supported the impugned judgment. He submitted that the Respondents had adduced sufficient evidence on record to substantiate that the price offered by the Land Acquisition Officer is adequate. The Appellants have failed to adduce any evidence that the price offered by the Land Acquisition Officer is just and proper. He submitted that the :4: Reference Court has rightly applied the well settled principle of law in fixing the market value for the acquired land and as such no interference is called for in the impugned judgment. He submitted that though village Loliem is in rural area there is development in the locality and as such the question of reducing escalation of 10% as awarded by the Reference Court would be unjust. He as such submitted that the Appeal deserves to be dismissed. 4. Having heard the learned Counsel for the Appellants and the Respondents and on perusal of records, the following point for determination arise in the present Appeal : POINT FOR DETERMINATION Whether the Reference Court was justified to fix the market value of the acquired land as on the date of Section 4 notification at the rate of Rs.28/- per square metre ? 5. In support of the claim of enhancement AW1 has produced a copy of the judgment dated 24th September, 1991 in Land Acquisition Case No. 144/1990 passed by this Court which is at Exhibit 19. In his affidavit in evidence, he has stated that he is an owner of the property which is surveyed under survey No. 280/12 of Village Loliem which admeasures 17,200 square metres and located in ward Xellim of Village Panchayat of Loliem which is bounded on the eastern side by a national :5: highway no.17. He has further stated that the Appellants have acquired an area of 2500 square metres from the said property in the year 1985 for the purpose of widening of the existing national highway. He has further stated that in the land which was acquired in the year 1985 the mundcarial house was also acquired and as such it does not now exist. He has further stated that the present acquisition is made in the year 1991 and the rate awarded was Rs.4/- per square metre for the plot of land of 880 square metres. He has further stated that in earlier notification another plot of land surveyed under survey Nos. 282/9 and 327/9 was also acquired which lands were bounded on eastern side by a national highway no. 17. He has further stated that the Appellants had offered a sum of Rs.10/- per square metre for the said land which came to be enhanced to Rs.35/- per square metre. The said award came to be confirmed by this Court wherein the price was fixed at Rs.35/- per square metre. He has further stated that both the lands are garden lands consisting of fruit bearing trees and suitable for construction and it has all facilities like telephone, transport, water supply and electricity at the time of the notification. In the cross examination, he has stated that the acquired land lies on either side of the existing road. He has stated that he is not in a position to give the length and the breath of the acquired strip of land nor the area of the land. The acquired land is situated on the left hand side of the road. He has stated that the land was level land having slight slope. He has further stated that he is unable to give the exact length of the strip of land which :6: is towards the right hand side of the road. He has stated that the land is located on the right hand side of the highway and the same is slightly at the higher level. He has further stated that there is a slight descending slope to the road which is in the property surveyed under survey No. 280/13. He has further stated that his property is of better quality as compared to the property surveyed under survey Nos. 327/9 and 282/9. 6. Next witness examined is Rejendra Keshav Bhat. He has stated that his family is having a land touching the national highway no. 17 and that the land acquired had fruit bearing trees. He has further stated that in the year 1985 the Government had acquired two plots on both sides of the road for national highway no.17 when the compensation was fixed at Rs.35/- per square metre by the District Court and the same was confirmed by this Court. He has further submitted that the distance from his property and the property belonging to the Applicant will be about 100 to 150 metres. He has denied the suggestion that the acquired land is about 15 metres lower than the realigned highway. 7. The Reference Court whilst passing the impugned judgment has found that the acquired land was in residential locality and suitable for residential purpose. The Reference Court has further found that the land of Keshav Venkatesh Bhat was at a distance of about 100 to 150 metres from the acquired land and that he was paid compensation at the rate of :7: Rs.35/- per square metre in the previous acquisition which took place in 1985. The Reference Court further found that similar amenities, advantages and disadvantages were available for both the lands. The learned Reference Court as such fixed the market value of the acquired land after giving escalation of 10% per annum on the said amount of Rs. 35/- per square metre for six years and thereafter deducted 50% on account of statutory restrictions and dissimilarities with the land which has now been acquired and fixed the compensation at the rate of Rs.28/- per square metre. 8. From the evidence on record, I find that the award passed at Exhibit 19 is comparable to the land acquired. There is no dispute that the land acquired was at a distance of 100 to 150 metres from the said land. Naturally the disadvantages found with both the properties are substantially the same. On perusal of Exhibit 19, I find that the land which was acquired in the year 1985 by the Government and located in the close vicinity of the acquired land was paid compensation at the rate of Rs.35/- per square metre. The evidence discloses that the land acquired and the land subject matter of the said award were similar in nature. The acquisition in the present case was in the year 1991. There can be no dispute that the land which was acquired was in rural area. Appreciation of land in rural area cannot be the same as in urban or semi-urban areas. The Respondents had failed to adduce any evidence to disclose the rate of :8: escalation of land for the said period of six years. In absence of such material on record, I find that as the land was located in a rural area, the escalation should be at the rate of 7.5% per annum. This rate of escalation is fixed considering the judgment of the Apex Court reported in 2008(14) SCC 745 in the case of General Manager, Oil and Natural Gas Corporation Limited V/s Rameshbhai Jivanbhai Patel and another wherein it has been held at para 14 thus : “14. On the other extreme, in remote rural areas where there was no chance of any development and hardly any buyers, the prices stagnated for years or rose marginally at a nominal rate of 1% or 2% per annum. There is thus a significant difference in increases in market value of lands in urban/semi-urban areas and increases in market value of lands in the rural areas. Therefore, if the increase in market value in urban/semi-urban areas is about 10% to 15% per annum, the corresponding increases in rural areas would at best be only around half of it, that is, about 5% to 7.5% per annum. This rule of thumb refers to the general trend in the nineties, to be adopted in the absence of clear and specific evidence relating to increase in prices. Where there are special reasons for applying a higher rate of increase, or any specific evidence relating to the actual increase in prices, then the increase to be applied would depend upon the same.” As such considering the said judgment of the Apex Court, the Reference Court was not justified to give escalation of 10% per :9: annum for the land acquired for the period of six years to fix the market value of the acquired land. 9. The evidence on record further demonstrate the dissimilarity of the acquired land vis-a-vis the award at Exhibit 19. The land acquired is a strip of land which is adjoining the national highway no.17 and such land definitely has restrictions for the purpose of construction as the considerable area would have to be reserved as road widening area which is considered to be non-development zone. The appropriate deductions will have to be effected to arrive at the market value of the acquired land after suitable deductions. The Reference Court after considering the dissimilarities between the acquired land and the land subject matter of the said award at Exhibit 19 has given deduction of 50%. Considering the dissimilarities of the acquired land, I find that the deduction of 50% as effected by the Reference Court is justified in the circumstances of the case. After such deduction of 50%, the market value of the acquired land works out to Rs.25/- per square metre approximately. The Reference Court as such was not justified to fix the market value of the land acquired at the rate of Rs.28/- per square metre when in fact the same is to be fixed at Rs.25/- per square metre. The point for determination is answered accordingly. 10. In view of the above, I pass the following : :10: O R D E R (i) The Appeal is partly allowed. (ii) The impugned judgment and award dated 29th December, 2003 is modified and the market value of the acquired land is fixed at Rs.25/- per square metre. (iii) Rest of the award granting statutory benefits is confirmed. (iv) The Appeal stands disposed of accordingly with no order as to costs. (v) The Registrar is directed to compute the amount payable to the Respondents in accordance with above judgment and disburse the amount so determined along with interest accrued thereon after a period of three months from today. (vi) The excess amount deposited along with interest accrued thereon shall be refunded to the Appellants. F. M. REIS, J. at*