Case: WAZIR Vs. THE STATE OF HARYANA

as the basis and then try to arrive at the appropriate value for the present acquisition. For this purpose, we may have to determine the rate of increase as shown by the sale deeds on record. The acquisition in Pran Sukh (2010) 11 SCC 175 was of the year 1994 and the award of rate therein corresponds with the rate available on record through Exh.P6. We have two instances of Exh.P8 and P4, which may indicate the rise in values. However in both instances, the lands were very small plots i.e. of an extent of less than half an acre. If the prices are to be compared in real terms, the values representing in two sale deeds Exh.P4 and P8 must be re-worked after effecting appropriate deduction. Normally the deductions can range from 20% upwards. We may however take the lowest of the quotient namely 20%. On that basis, over a period of two years i.e. between Pran Sukh (2010) 11 SCC 175 and Exh.P8 there would be no difference at all and the values would show the same rate. If the rate available from Exh.P4 is subjected to deduction of 20%, the corresponding value for a larger extent of land would be Rs.38.93 lakhs per acre. The difference between this value and the base value awarded in Pran Sukh (2010) 11 SCC 175 would then show the rise over a period of 7 years. In other words, the price of Rs.20.00 lakhs rose by Rs.18.93 lakhs in seven years that is to say it rose by 94.65% giving us an annual average of 13.52%. This rate represents pure increase on non-cumulative basis. If we adopt the rate, the base price as awarded in Pran Sukh (2010) 11 SCC 175 would have risen to the level of Rs.36.22 lakhs per acre. We may call this Method no.2. 25. The instances representing Exh. P1, P2 & P3 as well as P6, as a matter of fact do not show any increase at all as against the base rate as awarded in Pran Sukh (2010) 11 SCC 175 and the rise in Exh.P4 & P8 is also not substantial. Going by the law laid down by this Court on ONGC Ltd. (supra) in our considered view, the cumulative increase of 8% over the base rate as available in Pran Sukh (2010) 11 SCC 175 would give us the correct picture as to the rise in values in the area comprising of villages Naharpur Kasan and Kasan. The tabulated chart in that regard would be as under: chart 26. If the figures arrived at through these three methods are compared, the values of Rs.37.54 lakhs per acre under Method no.1, Rs.36.22 lakhs under Method no.2 and Rs.37.01 lakhs under Method no.3 are quite comparable. If the highest of these three figures is taken, the appropriate value for the lands in Naharpur Kasan and Kasan would be Rs.37.54 lakhs per acre in the year 2002. 27. The values in other three villages namely Bas Kusla, Bas Haria and Dhana have not shown any such increase. Apart from Exh.P1, P2 and P3, nothing has been placed on record, insofar as said villages are concerned. As stated herein above, even for these villages we may adopt the base rate of Rs.20.00 lakhs for the year 1994 and then consider the appropriate increase. As the sale deeds dated Exh. P1, P2 and P3 in respect of lands coming from these villages have not shown any increase at all, by way of rough and ready method we may adopt half the rise as shown in the lands coming from villages Naharpur Kasan and Kasan. Half the difference between Rs.20.00 lakhs as the base rate and Rs.37.54 lakhs adopted for the villages of Naharpur Kasan, Kasan and Manewsar would mean difference of Rs.8.77 lakhs over the base figure of Rs.20.00 lakhs as awarded in Pran Sukh (2010) 11 SCC 175. Thus, in our considered view, the market value of lands from villages Bas Kusla, Bas Haria and Dhana in 2002 must be at Rs.28.77 lakhs per acre. 28. In respect of lands coming from village Manesar, the High Court had granted 50% rise over and above the market value in respect of villages Naharpur Kasan and Kasan. The increase to that extent was well justified as the lands in village Manesar are abutting National Highway No.8 with excellent commercial potential. The grant of 50% rise is not seriously objected by the State and as such we confirm the same. Thus 50% rise over the figures as applicable to villages Naharpur Kasan and Kasan would lead us to the market value in respect of village Manesar which would be Rs.56.31 lakhs per acre. 29. We, however, find it difficult to accept grant of further 30% as severance charges to M/s. Kohli Holdings Private Limited. Normally the additional component of compensation in terms of Section 23(1)(thirdly) of the Act is granted when, a landholder suffers damage as a result of acquisition to the extent that the holding that he is left with stands comparatively diminished in terms of quality and value. For instance, if a railway track is to be built through an agricultural land held by a person,leaving two different halves with him, it would be impossible for him to carry on agricultural operations at an optimum level. This would lead to reduction in the value of the halves that he is left with. On the other hand, in a case where part of the holding is acquired for which appropriate commercial value is awarded, the rest of the value of the land will not stand diminished in terms of commercial potential. On the other hand, the potential of the remainder of the land would also increase drastically as the development would be right in the neighbourhood, thus giving substantial benefit to the landholder. In our view, the High Court was not justified in granting further compensation of 30% to M/s. Kohli Holdings Private Limited on account of severance charges.

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

Explanation:
1[ds]21. In the instant case, the sale deeds Exts.P1, P2 and P3 relied upon by the landholders pertained to lands from villages Bas Kusla and Dhana and were of the year 1997 that is after the acquisition was initiated in Pran Sukh. The maximum value per acre in these villages was Rs.8 lakhs per acre and that too with respect to smaller plots. The sale deeds Exts.P4, P6, P8 and PY however pertained to lands coming from villages Naharpur Kasan and Kasan. Ext.PY dated 28.04.2004 was much after the acquisition was initiated in the present case. Secondly, as found by the High Court in para 74 of its judgment, there was construction and CLU was also obtained in relation to land in Ext. PY . For these reasons the High Court had rightly ruled out said transaction. At the same time Ext.P4 was also after the acquisition in the present case was initiated and pertained to a small plot of land. Out of these four sale deeds, Ext.P8 is prior in point of time so far as the present acquisition is considered and was therefore rightly relied upon asthe most appropriate exemplar by the High Court. If the value in Ext.P8 is compared with the maximum value under Exts.P1, P2 and P3 there is a marked difference. This difference is again consistent with the valuation that was accepted by the Sub-Divisional Officer cum Land Acquisition Collector. Since major part of the land under acquisition that is more than ? rds is from villages Bas Kusla, Bas Haria and Dhana, one way of assessing the correct value of compensation is to treat these three villages on one side while other three villages on the other side.22. However, not only the Reference Court but the High Court on three different occasions had considered all these villages together and applied the same rate of compensation. The base rate was initially taken by the Reference Court to be Rs.15 lakhs in terms of the decision of the High Court in Pran Sukh and later to be Rs.20 lakhs as per the decision of this Court. The High court on all three occasions had based its assessment taking base rate in Pran Sukhbe the starting point. We must also note that in Pran Sukh, this Court had also applied uniform rate for the entirety of the extent of 1490 acres of land coming from four different villages. It would therefore be inappropriate at this stage to make a distinction between these two sets of villages for the purposes of base rate. But this point willcertainly be of relevance when we consider the ratio of escalation. The sale deeds Exts.P1, P2 and P3 indicate that even after the initiation of acquisition in Pran Sukhcase which was in 1994, the valuation of the lands was still at a lower level. On the other hand, the valuation in respect of Ext. P-8 has shown some increase.23. As regards lands in Naharpur Kasan and Kasan, Exh. PY dated 28.04.2004 having been ruled out of consideration, we are now left with 3 sale instances namely Exh. P4, P6 and P8. We may first consider pre- acquisition instances namely Exh. P6 & P8. Exh. P6 dated 16.09.1994 pertained to land having an extent of 12 acres, a fairly large area, where the value was Rs.20.00 lakhs per acre. This value is equal to the one which was granted by this Court in the case of Pran Sukhfor the acquisition of 1994. The next sale deed namely Exh.P8 dated 29.09.1996 pertained to very small piece of land which was less than ½ acre and the value was in the region of 25.00 lakhs per acre. Without effecting any deduction on account of smallness of the plot and considering the values as they stand, it shows an increase of 25% over a period of two years, i.e. to say @ 12.5% per annum. This is one indication as to the nature of increase in price after 1994.We have another sale instance namely Exh. P4 dated 18.08.2003 which was after a year and half from the dates of Notifications issued under Section 4 in the present matter. If the very same rate of increase, though this Court in the decision in ONGC Ltd. (supra) had ruled that while deducting from a post-acquisition instance and working backwards the rate of deduction ought to be higher, is adopted in the present matter, 18.75% will have to be deducted from the price which was prevalent in August 2003 to arrive at the corresponding value for the period when the present acquisition was initiated. The rate of Rs.48.366 lakhs per acre, as available from Exh.P4, again without effecting any deductions for the smallness of the plot, must for the purposes of calculation suffer a deduction of Rs.9.12 lakhs @ 18.75%. We thus arrive at a figure of Rs.37.54 lakhs as the prevalent price in the year 2002. This price is arrived at first by considering the rate of deduction which the value representing the sale instance of August 2003 must suffer and secondly after effecting appropriate deduction, arrive at the appropriate value for the present purposes. We may call this Method no.1.24. We now consider the matter from a different perspective and take the rate awarded in Pran Sukhthe basis and then try to arrive at the appropriate value for the present acquisition. For this purpose, we may haveto determine the rate of increase as shown by the sale deeds on record. The acquisition in Pran Sukhof the year 1994 and the award of rate therein corresponds with the rate available on record through Exh.P6. We have two instances of Exh.P8 and P4, which may indicate the rise in values. However in both instances, the lands were very small plots i.e. of an extent of less than half an acre. If the prices are to be compared in real terms, the values representing in two sale deeds Exh.P4 and P8 must be re-worked after effecting appropriate deduction. Normally the deductions can range from 20% upwards. We may however take the lowest of the quotient namely 20%. On that basis, over a period of two years i.e. between Pran SukhExh.P8 there would be no difference at all and the values would show the same rate. If the rate available from Exh.P4 is subjected to deduction of 20%, the corresponding value for a larger extent of land would be Rs.38.93 lakhs per acre. The difference between this value and the base value awarded in Pran Sukhwould then show the rise over a period of 7 years. In other words, the price of Rs.20.00 lakhs rose by Rs.18.93 lakhs in seven years that is to say it rose by 94.65% giving us an annual average of 13.52%. This rate represents pure increase on non-cumulative basis. If weadopt the rate, the base price as awarded in Pran Sukhwould have risen to the level of Rs.36.22 lakhs per acre. We may call this Method no.2.25. The instances representing Exh. P1, P2 & P3 as well as P6, as a matter of fact do not show any increase at all as against the base rate as awarded in Pran Sukhrise in Exh.P4 & P8 is also not substantial. Going by the law laid down by this Court on ONGC Ltd. (supra) in our considered view, the cumulative increase of 8% over the base rate as available in Pran Sukhwould give us the correct picture as to the rise in values in the area comprising of villages Naharpur Kasan and Kasan.26. If the figures arrived at through these three methods are compared, the values of Rs.37.54 lakhs per acre under Method no.1, Rs.36.22 lakhs under Method no.2 and Rs.37.01 lakhs under Method no.3 are quite comparable. If the highest of these three figures is taken, the appropriate value for the lands in Naharpur Kasan and Kasan would be Rs.37.54 lakhs per acre in the year 2002.27. The values in other three villages namely Bas Kusla, Bas Haria and Dhana have not shown any such increase. Apart from Exh.P1, P2 and P3, nothing has been placed on record, insofar as said villages are concerned. As stated herein above, even for these villages we may adopt the base rate of Rs.20.00 lakhs for the year 1994 and then consider the appropriate increase. As the sale deeds dated Exh. P1, P2 and P3 in respect of lands coming from these villages have not shown any increase at all, by way of rough and ready method we may adopt half the rise as shown in the lands coming from villages Naharpur Kasan and Kasan. Half the difference between Rs.20.00 lakhs as the base rate and Rs.37.54 lakhs adopted for the villages of Naharpur Kasan, Kasan and Manewsar would mean difference of Rs.8.77 lakhs over the base figure of Rs.20.00 lakhs as awarded in Pran SukhThus, in our considered view, the market value of lands from villages Bas Kusla, Bas Haria and Dhana in 2002 must be at Rs.28.77 lakhs per acre.28. In respect of lands coming from village Manesar, the High Court had granted 50% rise over and above the market value in respect of villages Naharpur Kasan and Kasan. The increase to that extent was well justified as the lands in village Manesar are abutting National Highway No.8 with excellent commercial potential. The grant of 50% rise is not seriously objected by the State and as such we confirm the same. Thus 50% rise over the figures as applicable to villages Naharpur Kasan and Kasan would lead us to the market value in respect of village Manesar which would be Rs.56.31 lakhs per acre.29. We, however, find it difficult to accept grant of further 30% as severance charges to M/s. Kohli Holdings Private Limited. Normally the additional component of compensation in terms of Section 23(1)(thirdly) of the Act is granted when, a landholder suffers damage as a result of acquisition to the extent that the holding that he is left with stands comparatively diminished in terms of quality and value. For instance, if a railway track is to be built through an agricultural land held by a person,leaving two different halves with him, it would be impossible for him to carry on agricultural operations at an optimum level. This would lead to reduction in the value of the halves that he is left with. On the other hand, in a case where part of the holding is acquired for which appropriate commercial value is awarded, the rest of the value of the land will not stand diminished in terms of commercial potential. On the other hand, the potential of the remainder of the land would also increase drastically as the development would be right in the neighbourhood, thus giving substantial benefit to the landholder. In our view, the High Court was not justified in granting further compensation of 30% to M/s. Kohli Holdings Private Limited on account of severance charges.