Case: Collector Of Varanasi Vs. Gauri Shankar Misra &amp; Ors

For the purpose of constructing the Babatpur aerodrome near Varanasi, the Government acquired in the year l946 about 500 acres of land. Compensation in respect of most of the lands acquired was settled by agreement. But in respect of the lands with which we are concerned in this appeal, 48.01 acres in extent, no settlement was arrived at. Therefore, the question of compensation in respect of those lands was referred to the arbitration of Shri S. B. Malik under Cl. (b) of sub-section (1) of Section 19 of the Act. In view of Section 19 (1) (e), the claimants were entitled to get as compensation the market value of those lands as on the date of acquisition. Before the arbitrator as well as the High Court, the parties were agreed that on the material on the record, the market value in question had to be fixed either on the basis of the sale deeds produced by the claimants or by capitalising the annual profits accruing from those lands. The arbitrator rejected the sale-deeds produced before him He adopted the method of capitalising the annual profits. On the question of annual profits also he rejected the evidence adduced on behalf of the claimants. He determined the same on the basis of the revenue records for Fasli 1355 read with the evidence of the Naib Tehsildar, Jawal Prasad. Aggrieved by the decision of the arbitrator, the claimants went up in appeal to the High Court of Allahabad under Section 19 (1) (f). The High Court differed from the arbitrator as to the value to be attached to the sale-deeds produced. It opined that the sale deeds produced were reliable and that they evidenced genuine transactions. The High Court fixed the compensation payable on the basis of Exhibit A 42 dated 3-4-1951. The arbitrator had fixed the compensation at Rs. 26454-12-0. The High Court enhanced the same to Rs. 90,446-3-0. It is against that decision that the Collector of Varanasi has filed this appeal after obtaining special leave from this Court under Article 136.

Court's reasoning:
There was no dispute that the arbitrator appointed under Section 19 (1) (b) was not a court. The fact that he was the District Judge, Varanasi, was merely a coincidence. There was no need to appoint the District Judge of Varanasi or any other District Judge as an arbitrator under that provision. Section 19 (1) (f) provides for an appeal against the order of thefact that the arbitrator appointed under Section 19 (1) (b) is either a designated person or a tribunal-as to whether he is a person designated or a tribunal we express no opinion-does not in any way bear on the question whether the High Court referred to under Section 19 (1) (f) is a court or not. Our statutes are full of instances where appeals or revisions to courts are provided as against the decisions of designated persons and tribunals.See for example, Advocates Act, Trade Markshierarchy of courts in this country is an organ of the State through which its judicial power is primarilydecisions relied on by this Court merely lay down the proposition that the decision given by the High Court in an appeal against an award is neither a decree, judgment or final order. None of the aforementioned decisions lay down the proposition that the High Court while exercising its appellate power did not function as a court. The observation in this Courts judgment that the provision for appeal to the High Court under Sec. 19 (1) (1) can only be construed as reference to it as an authority designated and not as a court, does not receive any support from those decisions. Nor do we find any sound basis for that conclusion. With respect to the learned Judges who decided that case, we are unable to agree with that conclusion.In our judgment while acting under Section 19 (1) (f), the High Court functions as a court and not as a designated person. Our conclusion in this regard receives support from the decision of the Judicial Committee in 43 Ind App 192 = (AIR 1916 PC 21) referred to earlier.Dealing with the ratio of its decision in Rangoon Botatoung Co.s case, (1912) 39 Ind App 197 (PC) this is what Lord Shaw of Dunfermline observed (at p. 198 of the report)This takes us to the merits of the case. The grievance of the appellant is that the High Court erred in law in awarding compensation on the basis of Exh. 42. The sale evidenced by that deed was effected in the year 1951, nearly five years after the acquisitions with which we are concerned in this case were effected. The sale in question cannot be considered as a contemporaneous transaction. The Arbitrator has found that after the close of the second world war, the price of landed property had gone up steeply. This finding does not appear to have been challenged before the High Court. Further, under the deed in question, the land sold was 26 acres in extent. The price fetched by such a tiny bit of land is of no assistance in determining the value of the lands acquired. On behalf of the respondents, we were asked to determine the compensation of the lands acquired on the basis of sale deed Exh.35 which relates to a sale that took place on 10-6-1947 which according to the respondents can be considered as a contemporaneous sale. We are unable to accept this contention. Exh. 35 relates to the sale of land measuring 28 acres.The vendee under that deed is one of the claimants. There is no evidence as to the nature of the land sold under that deed. Under these circumstances, very little value can be attached to that document. We are also of the opinion that none of the sale deeds produced in this case can afford any assistance in determining the compensation payable to the respondents. They do not evidence sales of lands similar to the acquired lauds, at about the time of the acquisition. The High Court did not address itself to the oral evidence adduced in this case for finding out the annual profits for the purpose of capitalisation. It rejected the evidence of the Naib-Tehsildar. For reasons not disclosed the village papers of 1354 fasli were not produced by the appellant. On the other hand, the village papers of 1355 fasli were produced. In the first place those records do not show the rent payable in the year in which the acquisitions took place. The acquisitions in question were made in fasli 1354.For the reasons mentioned in its judgment, the High Court felt unable to place reliance on the village papers of fasli 1355. We do not think that this Court should see the evidence afresh for determining the just compensation payable to the respondents. That question has to be gone into by the fact finding court. All that we need say is that the High Court was not right in determining the compensation payable to the respondents on the basis of Exh. 42. Hence its decision cannot be sustained.