Case: UNION OF INDIA Vs. DYAGALA DEVAMMA

prudent purchaser would do. (13) The market value of the land under acquisition has thereafter to be deduced by loading the price reflected in the instance taken as norm for plus factors and unloading it for minus factors. (14) The exercise indicated in Clauses (11) to (13) has to be undertaken in a common sense manner as a prudent man of the world of business would do. We may illustrate some such illustrative (not exhaustive) factors: (15) The evaluation of these factors of course depends on the facts of each case. There cannot be any hard and fast or rigid rule. Common sense is the best and most reliable guide. For instance, take the factor regarding the size. A building plot of land say 500 to 1000 sq. yds. cannot be compared with a large tract or block of land of say 10,000 sq. yds. or more. Firstly while a smaller plot is within the reach of many, a large block of land will have to be developed by preparing a lay out, carving out roads, leaving open space, plotting out smaller plots, waiting for purchasers (meanwhile the invested money will be blocked up) and the hazards of an entrepreneur. The factor can be discounted by making a deduction by way of an allowance at an appropriate rate ranging approximately between 20 per cent to 50 per cent to account for land required to be set apart for carving out lands and plotting out small plots. The discounting will to some extent also depend on whether it is a rural area or urban area, whether building activity is picking up, and whether waiting period during which the capital of the entrepreneur would be locked up, will be longer or shorter and the attendant hazards. (16) Every case must be dealt with on its own fact pattern bearing in mind all these factors as a prudent purchaser of land in which position the judge must place himself. (17) These are general guidelines to be applied with understanding informed with common sense. 21. These principles are invariably kept in mind by the Courts while determining the market value of the acquired lands (also see Union of India v. Raj Kumar Baghal Singh (Dead) Through Legal Representatives and Ors. (2014) 10 SCC 422 ), 22. In addition to these principles, this Court in several cases have laid down that while determining the true market value of the acquired land especially when the acquired land is a large chunk of undeveloped land, it is just and reasonable to make appropriate deduction towards expenses for development of acquired land. It has also been consistently held that at what percentage the deduction should be made varies from 10% to 86% and, therefore, the deduction should be made keeping in mind the nature of the land, area under acquisition, whether the land is developed or not and, if so, to what extent, the purpose of acquisition, etc. It has also been held that while determining the market value of the large chunk of land, the value of smaller pieces of land can be taken into consideration after making proper deduction in the value of lands especially when sale deeds of larger parcel of land are not available. This Court has also laid down that the Court should also take into consideration the potentiality of the acquired land apart from other relevant considerations. This Court has also recognized that the Courts can always apply reasonable amount of guesswork to balance the equities in order to fix a just and fair market value in terms of parameters specified Under Section 23 of the Act. (See Trishala Jain and Anr. v. State of Uttaranchal and Anr. (2011) 6 SCC 47 , (and Vithal Rao and Anr. v. Special Land Acquisition Officer, (2017) 8 SCC 558 ) 23. Keeping in mind the aforementioned principles, when we take note of the facts of the case at hand, we find that firstly, the land acquired in question is a large chunk of land (101 acres approx.); Secondly, it is not fully developed; Thirdly, the Respondents (landowners) have not filed any exemplar sale deed relating to large pieces of land sold in acres to prove the market value of the acquired land; Fourthly, exemplar relied on by the Respondents, especially Ex. P-18 pertains to very small pieces of land (19 guntas); Fifthly, the three distinguishing features noticed in the land in sale deed (Ex. P-18) are not present in the acquired land. 24. It was for the aforementioned reasons, in our opinion, the Reference Court was justified in making deduction of 50% towards developmental charges from the market value. The High Court, in our opinion, did not assign any good reason as to why and on what basis, it considered proper to make deduction towards developmental charges at the rate of 25% in place of 50%. 25. This Court has held in Trishala Jains case (supra) that it depends upon the facts of each case to decide for determination of the market value of the land as to what percentage should be adopted for deduction. In our opinion, the reasons mentioned above were rightly made basis by the Reference Court to support the deduction of 50%. 26. So far as the determination of market value made by the Reference Court is concerned, i.e., Rs. 21,29,600/- per acre, the same having been upheld by the High Court, we do not find any justification to examine this issue again. Even the learned ASG did not challenge this finding and confined his submissions only relating to the issue of percentage of the deduction only. 27. Learned Counsel for the Respondents was not able to point out any fact/evidence which could persuade us to uphold the reasoning and conclusion arrived at by the High Court in the impugned judgment. 28. In view of the foregoing discussion, we are inclined to uphold the reasoning and the conclusion arrived at by the Reference Court instead of the High Court. 29.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]Keeping in mind the aforementioned principles, when we take note of the facts of the case at hand, we find that firstly, the land acquired in question is a large chunk of land (101 acres approx.); Secondly, it is not fully developed; Thirdly, thes (landowners) have not filed any exemplar sale deed relating to large pieces of land sold in acres to prove the market value of the acquired land; Fourthly, exemplar relied on by the, especially8 pertains to very small pieces of land (19 guntas); Fifthly, the three distinguishing features noticed in the land in sale deed) are not present in the acquired land.It was for the aforementioned reasons, in our opinion, the Reference Court was justified in making deduction of 50% towards developmental charges from the market value. The High Court, in our opinion, did not assign any good reason as to why and on what basis, it considered proper to make deduction towards developmental chargesat therate of25% in place of 50%.This Court has held in Trishalas case (supra) that it depends upon the facts of each case to decide for determination of the market value of the land as to what percentage should be adopted for deduction. In our opinion, the reasons mentioned above were rightly made basis by the Reference Court to support the deduction of 50%.So far as the determination of market value made by the Reference Court is concerned, i.e.,per acre, the same having been upheld by the High Court, we do not find any justification to examine this issue again. Even the learned ASG did not challenge this finding and confined his submissions only relating to the issue of percentage of the deduction only.for thes was not able to point out any fact/evidence which could persuade us to uphold the reasoning and conclusion arrived at by the High Court in the impugned judgment.In view of the foregoing discussion, we are inclined to uphold the reasoning and the conclusion arrived at by the Reference Court instead of the High Court.