SH. TOPANDAS KUNDANMAL, SINCE DECEASED

THEREAFTER BY HIS HEIRS AND LRS. ETC. v.

THE STATE THROUGH THE LAND ACQUISITION

OFFICER, JAMNAGAR ETC.

JULY 25, 1995

[K. RAMASWAMY AND K. S. PARIPOORNAN, JJ.]

Land Acquisition Act, 1894:

Compensation-Comparable transaction-Relevancy of-Award of Compensation on sq. ft. basis-When could be resorted to.

In the land acquisition proceedings appellants laid a claim at the rate of Rs. 1,08,898/per acre. The Land Acquisition Officer awarded a sum D of Rs. 2,500 per acre. Appellants made a Reference to the Civil judge, and restricted their claim to Rs. 2.00 per sq. ft. The Civil Court enhanced the compensation to Rs. 1.25 per sq.ft. The High Court set aside the award and decree of the Reference Court and confirmed that of the Collector.

Hence these appeals.

E Dismissing the appeals, this Court

HELD : It is settled law that the claimants are entitled to succeed for higher compensation only on proof of value prevailing as on the date of notification. Burden is always on the claimant to prove the same. It is p seen that the appellant purchased the land in 1957 at the rate of Rs. 190 per acre. The land adjacent to the land under acquisition was purchased two months prior to the date of Notification. It is common knowledge that issuance of Notification under s.4(1) to initiate acquisition would take considerable time and the publication of the Notification under s.4(1) of the Act would be made much later on. Having had knowledge, it would be G obvious that documents would be brought into existence to inflate the market value. All the sales refered in the award would only show the sales on acrage basis. Obviously the documents have been brought into existence on the basis of the sq.ft. to inflate higher market value. The property o~ 10

acres and 12 gunthas, when offered for sale in the open market, no prudent H purchaser would be willing to purchase the same on sq.ft. basis. If the 318

T.KUNDANMAL v. STA7:::: 319

small extent of land in a commercial area is sought to be acquired, A perhaps, determination of the compensation on the basis of the sq. ft. may be justified. But when the claimant himself assessed the market value at Rs. 190 per acre and purchased in 1957 and when in 1960 the 8 acres and 39 gunthas of neighbouring land was sold for Rs. 568 per acre, no prudent purchaser would offer to purchase on square foot basis. This Court in a B catena of decisions deprecated the practice of the reference courts or High Court to determine market value of the lands on sq. ft. basis unless it is established as a fact that the acquired lands are situated in already highly developed residential and industrial area where regular sales are on sq. ft. basis. The High Court also has given cogent and well considered reasons in not accepting the award and decree of the Reference Court. There are no compelling reasons to differ from the cogent reasons given by the High Court. [320-F-H, 321-A-E]

CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 3542-43 of 1972.

From the Judgment and Order dated 28.7.72 of the Gujarat High Court in A. No 521 of 1963 &. 519 of 1963.

With Civil Appeal Nos. 399-400 of 1973.

Bhimrao Naik, J. Jhaveri and H.J. Jhaveri for the appellants in C.A.

Nos. 3542-43/72.

Swaraj Kaushal and Ms. H. Wahi for the State.

Sunil Kr. Jain, for the Respondent in C.A. Nos. 399-400/73.

The following Order of the Court was delivered :

These appeals are by certificate of fitness granted by the High Court under Article 133(1) of the Constitution of India. Notification under s.4(1)

of Land Acquisition Act, 1894 (for short, 'the Act') was published on October 15, 1959 acquiring 10 acres and 12 gunthas of land situated in G Jamnagar for the establishment under development of T.B. Hospital. The appellants laid a claim pursuant to the notice issued under s.9 and 10 at the rate of Rs. 1,08,898 per acre. The Land Acquisition Officer in his award dated July 18, 1962 under s.11 awarded a sum of Rs. 2,500 per acre.

Dissatisfied therewith, a Reference to the Civil Judge senior division was H

SUPREME COURT REPORTS [1995) SUPP. 2 S.C.R.

A made under s.18 of the Act. The appellants restricted their claim to Rs. 2.00 per sq. ft. The Civil Court enhanced the compensation to Rs. 1.25 per sq. ft. The High Court in .the impugned judgment in the FirstAppeal Nos. 521 and 519 of 1963 dated 28.7.72 set aside the award and decree of the Reference Court and confirmed that of the Collector. Since the value

B involved is more than 20,000 the High Court granted a certificate. Thus these appeals.

The learned counsel for the appellants strenuously contended that Ex.39 dated August 8, 1959 to an extent of 5016 sq. ft. land was sold by Jaisukhlal Devji who was examined under Ex. 32, for a sum worked out at C the rate of Rs. 2.25 per sq. ft. and the High Court was not justified in rejecting that sale deed. In addition, he also placed reliance on Ex.38 dated December 6, 1959 of Rs. 2,700 which worked out at the rate of Rs. 2.88 per ft. proved through Lawshankar Monucha Manilal examined under Ex.28 who is the son of the vendee. It would also establish according to D the counsel, that there is a further increase in the value of the land. He also.buttressed his argument by reference to Ex. 41 July 12, 1990 under which 1200 sq. ft. was sold by Vijaykunvarba who was examined as Ex. 176 a neighbouring land. The High Court, therefore, was not justified in reversing the award and decree of the Civil Court. We find no force in the contention.

It is settled law that the claimants like plaintiffs are entitled to succeed for higher compensation only on proof of value prevailing as on the date of notification. What is the prevailing market value as on the date of notification is a question of fact to be proved by adducing evidence.

F Burden is always on him to prove the same. It is seen that the appellant himseif purchased the land in 1957 at the rate of Rs. 190 per acre. The land adjacent to the land under acquisition in S. No. 225-1 admeasuring 8 acres 39 gunthas was purchased by one Umiyashankar Damodar Vyas under Ex. 55 on August 25, 1960 at the rate of 568 per acre. Ex.39 strongly relied upon by the claimants was executed just two months prior to the G date of the Notification. It is common knowledge that issuance of Notification under s.4(1) to intiate acquisition would take considerable time and the publication of the Notifiction under s.4(1) of the Act would be made much later on. Having had knowledge, it would be obvious that documents would be brought into existence to inflate the market value. Ex.39 was H sought to be pressed into service to inflate the market value. The con-

T. KUNDANMAL v. STATE 321

clusion of the High Court is that no attempt was made by the claimant or A the vendor or vendee who were examined, to prove Ex.P.39, to prove the distance of the land covered in Ex.P-39 and the land under acquisition or as a comparable sale. We have seen the award of the Collector. All the sales referred in the award would only show the sales on acrage basis.

Obviously the documents have been brought into existence on the basis of B the sq. ft. to inflate higher market value. The property of 10 acres and 12 gunthas, when offered for sale in the open market, no prudent purchaser would be willing to purchase the same on sq. ft. basis. If this small extent of land in a commercial area, like Nariman Point in Bombay or Cannaught Place in Delhi is sought to be acquired, perhaps, determination of the compensation on the basis of the sq. ft. may be justified. But when the C claimant himself assessed the market value at Rs. 190 per acre and purchased in 1957 and when in 1960 the 8 acres and 39 gunthas of nighbouring land was sold for Rs. 568 per acres, no prudent purchaser would offer to purchase on square foot basis. This Court in a catena of decisions deprecated the practice of the reference courts or High Court to determine D market value of the lands on sq. ft. basis unless it is established as a fact that the acquired lands are situated in already highly developed residential and industrial area where regular sales are on sq. ft. basis. The High Court also has given cogent and well considered reasons in not accepting the award and decree of the Reference Court. We have carefully gone through the judgment and we find no compelling reasons to differ from the cogent E reasons given by the High Court . Accordingly, the appeals are dismissed but in the circumstances without costs.

G.N.

Appeals dismissed.