Haryana State Indusl.Devt.Corp.Ltd vs Udal & Ors.Etc.Etc

2. Feeling aggrieved/dissatisfied with the judgment of the learned Single Judge of the Punjab and Haryana High Court whereby he enhanced the amount of compensation payable to the landowners from Rs.28,15,356 per acre to Rs.37,40,000 per acre, the beneficiary of the acquisition, namely, Haryana State Industrial Development Corporation Limited, now known as Haryana State Industrial and Infrastructure Development Corporation (HSIIDC), and the landowners have filed these appeals.

Thus if M/s Heritage Furniture (P) Ltd. purchased land, which is the subject-matter of sale deed dated 16-9-1994, Ext. P-1, in the year 1993 at a price of about Rs 6 lakhs per acre as alleged by the review petitioner even though there is no evidence of purchase at such rate then its value increasing to Rs 20 lakhs per acre in the year 1994 is commensurate with the market trend. Moreover agreement to sell dated 31-5- 1994 was executed after first notification was issued under Section 4 on 30-4-1994 and it is a common knowledge that after publication of Section 4 notification, the value of the land increases.

5. It is further submitted that vide sale deed dated 14-12-1993 (Ext. P-10) one M/s DCN International Ltd. sold land measuring 62 kanals 7 marlas situated in Village Naurangpur, District Gurgaon for Rs 95,21,160 i.e. at the rate of Rs 13,74,345 per acre. Copy of sale deed dated 14-12-1993 is Annexure R-3 hereto.

6. I further state that sale deed dated 16-9-1994 (Ext. P-1) was executed pursuant to the agreement to sell dated 31-5-1994 between M/s Heritage Furniture (P) Ltd. (vendor) and M/s Duracell (India) (P) Ltd. (vendee) wherein the vendor agreed to sell the land in question measuring about 12 acres to the vendee at a sale price of Rs 2,42,00,000 (Rupees two crore forty-two lakhs only) as is clear from the recital in the sale deed itself. Ultimately vide sale deed dated 16-9-1994 the said land was sold at the same sale price by the vendor to the vendee. Thus the sale price of the land was agreed upon and fixed on 31-5-1994 as is clear from the recitation of the sale deed itself.

7. I further state that as per assertion of the review petitioner M/s Heritage Furniture (P) Ltd. (vendor) and M/s Duracell (India) (P) Ltd. (vendee) had common persons in their Board of Directors, namely, Shri Saroj Kumar Poddar, Ms Jyotsana Poddar and Shri Gurbunder Singh Gill. The review petitioner has filed search reports of both the said companies to show that the abovesaid three persons were common Directors of both the companies. However, from the said search report of M/s Duracell (India) (P) Ltd. it is clear that the two Directors, namely, Shri Saroj Kumar Poddar and Ms Jyotsana Poddar were appointed as Directors of this company on 9-6-1994 whereas Shri Gurbunder Singh Gill was appointed as its Director on 9-2-1997. Thus all the three alleged common Directors of the vendor and vendee companies were not on the Board of Directors of M/s Duracell (India) (P) Ltd. on or before 31-5-1994 on which date the agreement to sell the land in question was executed and the sale price was fixed. The said three Directors had no interest in M/s Duracell (India) (P) Ltd. (vendee) as on 31-5-1994 when the sale price of the land was fixed.

8. I further state that except for making a bald allegation that the sale price of the said land was inflated intentionally so that the vendee company would increase its share holding in a joint venture it was going to enter into with one Duracell Inc. USA, this assertion has not been substantiated by placing any cogent evidence on record. So much so that even it has not been pleaded in the review petition as to whether joint venture between M/s Duracell (India) (P) Ltd. and M/s Duracell Inc. USA did take place or not. To the knowledge of the deponent there was no joint venture between M/s Duracell (India) (P) Ltd. and M/s Duracell Inc. USA. This fact that there was no joint venture between the said two companies also stands proved from the fact that the land purchased vide the said sale deed dated 16-9-1994 was sold by M/s Duracell (India) (P) Ltd. vide sale deed dated 28-4-2004 to one M/s Lattu Finance & Investments Ltd. at a sale consideration of Rs 13,62,00,000 i.e. approximately at the rate of Rs 1,13,00,000 (Rupees one crore thirteen lakhs per acre approximately). At the time the name of M/s Duracell (India) (P) Ltd. had been changed to M/s Gillette India Ltd. on account of its amalgamation with other company. In this sale deed dated 28-4-2004 entire history of purchase of land by M/s Duracell (India) (P) Ltd. from M/s Heritage Furniture (P) Ltd. in 1994 onwards has been recited, which includes construction of industrial building over the said land, its conversion of status from private limited to public limited company, its amalgamation with Indian Shaving Products Ltd. in the year 2000 and its change of name from Indian Shaving Products Ltd. to Gillette India Ltd. in December 2000 and thereafter its sale to M/s Lattu Finance & Investments Ltd. However, in the entire recitation there is no mention of any joint venture with M/s Duracell Inc. USA.

(d) It is also submitted that some other sale deeds at the relevant time (20-9-1996) were executed in favour of Time Master (P) Ltd. which came around Rs 25 lakhs per acre. Details of the same are as follows:

22. The learned Single Judge separately considered the claim of M/s. Kohli Holdings Private Limited which had filed R.F.A. No.4646 of 2010. He took cognizance of the location of 69 kanals 15 marlas land belonging to M/s. Kohli Holdings Private Limited on National Highway 8 with frontage of two acres and the existence of a five star hotel and a resort on the adjoining land. The learned Single Judge relied upon allotment of 30,000 square meters land made by HSIIDC vide Exhibit P38 to M/s. Orient Craft Limited (sister concern of M/s. Kohli Holdings Private Limited) at the rate of Rs.1,254 per square yard, granted an annual increase of 15% on that price and awarded compensation at the rate of Rs.2119 per square yard (Rs.1,02,55,960 per acre). Paragraphs 31, 33 and 34 of the impugned judgment which exclusively deal with the case of M/s. Kohli Holdings Private Limited are as under:

26. For the reasons stated above, the appeals filed by the Corporation are dismissed and those filed by the landowners are allowed with the direction that the Corporation shall pay market value of the entire acquired land at the rate of Rs. 20 lakhs per acre with all statutory benefits.”

28. We have considered the respective submissions and carefully scrutinized the records including the additional affidavits filed on behalf of the parties and their written arguments.

30. The other error committed by the learned Single Judge is that he granted annual increase at a flat rate of 12/15%.

urban areas. Ranjit Singh related to acquisition for development of Sector 41 of Chandigarh. Ramanjulu related to acquisition of the third phase of an existing and established industrial estate in an urban area. Bipin Kumar related to an acquisition of lands adjoining Badaun- Delhi Highway in a semi-urban area where building construction activity was going on all around the acquired lands.

18. The increase in market value is calculated with reference to the market value during the immediate preceding year. When market value is sought to be ascertained with reference to a transaction which took place some years before the acquisition, the method adopted is to calculate the year to year increase. As the percentage of increase is always with reference to the previous year's market value, the appropriate method is to calculate the increase cumulatively and not applying a flat rate. The difference between the two methods is shown by the following illustration (with reference to a 10% increase over a basic price of Rs 10 per square metre):

34. In view of the above conclusions, we do not consider it necessary to deal with the other points argued by learned counsel for the parties/intervenors and feel that ends of justice will be served by setting aside the impugned judgment and remitting the matters to the High Court for fresh disposal of the appeals and cross objections filed by the parties subject to the rider that the State Government/HSIIDC shall pay the balance of Rs.37,40,000 to the landowners along with other statutory benefits.

35. In the result, the appeals are allowed, the impugned judgment is set aside and the matter is remitted to the High Court for fresh disposal of the appeals filed by the parties under Section 54 of the Act as also the cross objections. The parties shall be free to urge all points in support of their respective cause and the High Court shall decide the matter uninfluenced by the observations contained in this judgment.

36. Maruti Udyog Limited shall be free to file an appropriate application before the High Court for its impleadment or grant of leave to act as intervenor in the appeals filed by the parties. If such an application is filed, the same shall be decided on its own merits.

37. The State Government/HSIIDC shall pay the balance of compensation determined by the High Court, i.e., Rs.37,40,000 - Rs.28,15,356 = Rs.9,24,644 per acre to the landowners and/or their legal representatives along with all statutory benefits within a period of four months from today. The payment shall be made to the landowners and/or their legal representatives by following the procedure laid down in the interim orders passed by this Court.