IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD TUESDAY, THE THIRTEENTH DAY OF JULY TWO THOUSAND AND TEN PRESENT THE HON'BLE MR JUSTICE V.ESWARAIAH & THE HON'BLE MR JUSTICE NOUSHAD ALI A.S. No.2072 of 1993 Between: Land Acquisition Officer (Mandal Revenue Officer) Meliaputti ..... APPELLANT AND Boipothu Jagannaikulu and 36 others .....RESPONDENTS The Court made the following: THE HON'BLE SRI JUSTICE V.ESWARAIAH & THE HON'BLE SRI JUSTICE NOUSHAD ALI A.S. No.2072 of 1993 JUDGMENT: (per Hon’ble Sri Justice V.Eswaraiah) The Land Acquisition Officer filed this appeal suit aggrieved by the judgment of the Land Acquisition Appellate Authority-cum-Principal Subordinate Judge, Srikakulam dated 23.10.1992 in L.A.O.P.23/88 in enhancing the compensation from Rs.4,545/- to Rs.50,000/- per acre. 2. The respondents are the claimants. Their lands were acquired pursuant to the notification issued under Sec.4(1) of the Land Acquisition Act published in the gazette on 15.09.1986 for the purpose of providing house sites to the weaker sections. Award No.5/87-88 dated 23.01.1988 was passed awarding compensation @Rs.4,545/- per acre. The acquired land was an extent of Ac.5.09 cents in Sy.No.60/1 and 60/2 of Peddapadmapuram village, Meliaputti Mandal. The claimants received the compensation on protest and requested to refer the matter to civil Court for fixing of true and actual market value of the acquired land. The Land Acquisition Officer made a reference to the Land Acquisition Appellate Authority-cum-Principal Subordinate Judge, Srikakulam in O.P.23/1988. The Reference Court enhanced the compensation from Rs.4,545/- to Rs.50,000/- per acre. 3. The learned Government Pleader for Land Acquisition submits that the Reference Court erroneously relied on Ex.B1 which is not similar in potentiality and more over it is covered by a small extent of Ac.0.04¼ cents, whereas the land acquired is larger extent of Ac.5.09 cents. The market value of Ex.B1 is not the real market value. The claimants made the reference in respect of Ac.4.72 cents only. 4. According to the claimants, the land was acquired for the purpose of providing house sites to the weaker sections as it was fit for construction of houses, that the market value fixed by the Land Acquisition Officer is very meagre and the Land Acquisition Officer fixed the compensation relying on Ex.A5 dated 18.03.1985. It is stated that the market value of the house sites in the surrounding locality of the acquired land was worth Rs.1 lakh, and therefore, they are entitled for compensation @Rs.1 lakh per acre. 5. In support of their claim, the 9th claimant was examined as RW 1. He stated that the land acquired is dry land and it is situated adjacent to the village. It is useful for construction of houses and also useful for establishment of industries. It is stated that the land covered by Ex.B1 sale deed dated 24.10.1985 is situated in Sy.No.60/3 and it is adjacent to the acquired land, under which an extent of Ac.0.02 cents of land was sold for Rs.2,000/-. It is stated there are houses, schools, shops, rice mill, floor mill, oil mill etc. are located in and around the acquired land. The Agricultural Cooperative Society purchased Ac.0.17 cents for a sum of Rs.4,500/- under Ex.B2 sale deed dated 21.12.1984. Under Ex.B3 sale deed dated 14.02.1985 an extent of Ac.0.03 cents was purchased for Rs.800/-. Under Ex.B4 sale deed dated 08.06.1987 an extent of Ac.0.02 cents in Sy.No.60/3 was purchased for a sum of Rs.1500/-. The land under Ex.B2 was purchased by the Cooperative Bank and the land covered under Ex.B3 is at a distance of one furlong from the land of Ex.B2. 6. RW 2 is the husband of purchaser of Ex.B1 and Ex.B4 sale deeds. RW 3 is the seller of Ex.B4. RW 4 is the seller of Ex.B2. 7. On behalf of the Land Acquisition Officer, the Mandal Revenue Officer was examined as PW 1 and marked Ex.A1 the combined sketch plan. He stated that the acquired lands are dry agricultural lands. The Land Acquisition Officer considered Exs.A2 to A11 and fixed the market value @Rs.4,545/- per acre relying on Ex.A5 sale transaction dated 18.03.1985, under which an extent of Ac.0.33 cents in Sy.No.67/4 was sold for Rs.1,500/- It is stated that in fact the claimants have filed a petition before the Land Acquisition Officer claiming compensation @Rs.27,000/- per acre only, but whereas in the claim petition made before the Reference Court they have claimed compensation @Rs.1 lakh per acre. 8. Heard both the counsel. 9. The only question that arises for consideration in this appeal suit is whether the enhancement of compensation made by the Reference Court from Rs.4,545/- to Rs.50,000/- per acre is excessive and the document relied on by the Reference Court to enhance the market value is proper and relevant. 10. The claimants filed Exs.B1 to B4 documents and Reference Court relied on Ex.B1 document and enhanced the compensation. Ex.B1 relates to the sale transaction of land situated in the same sub-divided Sy.Nos.60/2 and 3 in respect of Ac.0.04¼ cents for a sum of Rs.2,000/- which works out to Rs.47,058/- per acre. According to the claimants and Land Acquisition Officer, the lands were acquired for the purpose of providing house sites to the weaker sections. When the land was acquired for house sites, it is obvious that at least one-third of the land towards development, such as laying of roads, drainages, electricity etc. would be deducted. The Reference Court ought to have deducted one- third of the sale transaction covered by Ex.B1. However, the land covered by Ex.B1 sale transaction is very small extent i.e. Ac.0.04¼ cents. 11. In so far as Ex.B3 is concerned, the lands covered under Ex.B3 are situated far away and not nearby the acquired land. In so far as Ex.B4 is concerned, admittedly, Ex.B4 sale transaction is subsequent to Sec.4(1) notification. Therefore, Exs.B3 and B4 are not relevant to take into consideration for fixing the market value of the land acquired. 12. In so far as Ex.B2 is concerned, it relates to sale transaction dated 21.12.1984 in respect of Ac.0.17 cents in Sy.No.54/3 for a sum of Rs.4,500/- which works out to Rs.26,470/- per acre. According to Ex.A1 sketch and evidence of PW 1, though the land covered by Ex.B2 is situated in different survey number, it is located contiguous to the acquired land. The extent of land covered by Ex.B2 is four times bigger than of Ex.B1 land. The Reference Court ought to have taken into consideration Ex.B2 as it is situated adjacent and abutting the land acquired. We are of the opinion that Ex.B2 sale transaction is relevant and proper to take into consideration for fixing the market value of the land acquired, as it reflects true and actual market value at the relevant point of time of acquisition. 13. Accordingly, we are inclined to fix the market value of the land acquired based on Ex.B2 sale deed which works out to Rs.26,470/- per acre. Ex.B2 relates to one year eight months prior to the Sec.4(1) notification and therefore, we would like to add escalation charges at 15% on the fixed market value. If 15% is added to Rs.26,470/- the market value of the land acquired would come to Rs.30,440/-. Accordingly, we fix the market value of the acquired land @Rs.30,440/- per acre. 14. In so far as interest is concerned, the Reference Court committed an error in awarding interest from prior to the date of Sec.4(1) notification i.e. from the date of taking possession of the land. As per the judgment of the Apex Court reported in R.L.Jain v.DDA[1] the interest cannot be awarded prior to the date of Sec.4(1) notification. Accordingly, the order of the Reference Court is set aside and modified. The compensation awarded by the Reference Court is reduced from Rs.50,000/- to Rs.30,440/- per acre with interest from the date of Sec.4(1) notification i.e. from 15.09.1986 only till realisation. 15. The appeal against the deceased-2nd respondent is dismissed, as the petitions filed by the learned Government Pleader for Appeals in CMP Nos.12502, 12503 and 12504 of 2001 to condone the delay in filing the LR petition, to set aside the abatement caused due to the death of the 2nd respondent and to bring the LRs of the deceased-2nd respondent are dismissed vide separate docket order. 16. Accordingly, the appeal is allowed as above against all respondents except the deceased-2nd respondent. No order as to costs. ___________________ V.ESWARAIAH,J ___________________ NOUSHAD ALI,J Dated: 13.07.2010 Dsr [1] (2004) 4 Supreme Court Cases 79