T.N. Singh, J.
1. The appellant in one of the two appeals is the claimant in a land acquisition proceedings who is the victim of few fortuitous circumstances. Her land measuring 19 bighas 3 kathas 14 lechas were requisitioned in 1962 under the D. T. Rules for 'defence purposes'. The acquisition proceedings were started in 1970 under the Requisitioning and Acquisition of Immovable Property Act 1952, for short the '1952 Act'. Her brother also had lands adjacent to her which were also similarly requisitioned, but in respect of his land acquisition was made in 1973 under the Land Acquisition Act, 1894, for short 'the 1894 Act' as a result of which he got higher compensation. She was paid by the Collector for her land at the rate of Rupees 8,500/- per bigha against her claim of Rs. 15,000/- per bigha. The arbitrator, in reference, gave her a rise, of Rs. 500/- per bigha. Her brother got for similar lands at the rate of Rs. 11,000/- per bigha, albeit, including the solatium which was payable under the 1894 Act of which the appellant has been deprived under the 1952 Act.
2. The Collector has also filed a cross appeal (F. A. 64/74) against the decision of the arbitrator but realising the position that the arbitrator had not dealt with the matter satisfactorily due to which it is the claimant who has suffered and not the Collector. Mr. D. C. Mahanta, the learned Govt. Advocate, has not pressed his appeal seriously.
3. In this Court Mr. J. N. Sarma, the learned counsel for the claimant-appellant in F. A. No. 51/74, has drawn our attention to the fact that the learned arbitrator, has neither taken into consideration the potential value of the land nor has he applied his mind to the fact that the valuation of the larger area was amenable to assessment on blockwise basis. It has also been contended before us that there was no valid reason for which the rate of compensation paid to her brother (P. W. 2) who had proved the fact of receipt of higher compensation, should not be paid to her also, if not more, because her lands were definitely superior to the lands of her brother. He further submits that the learned arbitrator without appreciating the evidence on record erroneously concluded that P. W. 2 was (paid) a higher compensation because his lands were acquired three years later and that the price of the land of that locality had gone up during these 3 years. His finding in this respect, the learned counsel submits, is based on mere surmises and conjectures. It is also submitted by him that the learned arbitrator indulged in pure guess work in assessing the compensation inasmuch as he rejected both the sale deeds, Exts. 1 and 2 and without indicating any other basis gave the nominal rise of Rupees 500/- per bigha on the consideration that the claimant was deprived of the solatium for which she ought to be paid something.
4. It is indeed a matter of some concern that there has occurred a manifest discrimination in this case as a result of the State applying different provisions under two different enactments to similarly situated persons but this aspect of the matter has not been agitated in this appeal. Nevertheless, the scheme and the relevant provisions of the 1952 Act requite examination. Under Section 7 of the Act 'power' is conferred on the Central Govt. to acquire the property requisitioned under the Act and the principles and method of determining the 'compensation' therefor are prescribed in Section 8 of the Act. The 'power' to do so is however circumscribed by the provisions of Sub-section (3) of Section 7 which lays down the conditions precedent for making the acquisition and these have a material bearing on the facts of this case. These are as follows :--
7. (1) and (2) xxx xxx xxx
(3) No property shall be acquired under this section except in the following circumstances, namely -
(a) Where any works have, during the period of requisition been constructed on, in or over, the property wholly or partially at the expense of the Central Government and the Government decides that the value of, or the tight to use, such works should be secured or preserved for the purpose of Government; or
(b) Where the cost of restoring the property to its condition at the time of its requisition would, in the determination of the Central Government, be excessive and the owner declines to accept release from requisition of the property without payment of compensation for so- restoring the property.
5. The amount of 'compensation' can be either fixed by an agreement under Section 8 (1) (a) or may be left to be determined by an arbitrator when no such agreement can be reached. The arbitrator is required under Section 8 (1) (e) to hear the 'dispute' and determine the 'compensation' which appears to him to be just and to have regard to the 'circumstances of each case' while applying the provisions of Sub-section (3) which is in the following term:
Section 8 (3) : The compensation payable for the acquisition of any property under Section 7 shall be the price which the requisitioned property would have fetched in the open market, if it had remained in the same condition as it was at the time of requisitioning and been sold on the date of acquisition.
The significant omission of solatium in Sub-section (3) of Section 8 is also indicative in our opinion, of legislative intent necessitating stress on the expressions 'just' and 'circumstances of each case' occurring in Sub-section (1) (a) thereof.
6. Evidently, it is considered desirable under the aforesaid provision that the claimant shall not be entitled to benefit by the improvements made on the lands by the Government during the period of requisition, but the arbitrator acting under Section 8 (1) (e) has to consider circumstances of each case to determine a 'just compensation' and in doing so he can consider if the acquisition has been made in violati on of Section 7 (3) as a result of which injustice has been done to the claimant in any case. The departure in the 1952 Act from the scheme of the 1894 Act as respects determination of compensation was noted in a decision by another Bench of this Court but this aspect of the matter was not examined in that case. The decision in D. C. Kamrup v. Naren Kalita (decided on 14-12-82) to which one of us (T. N. Singh, J.) was a party, construed the expression 'open market'. The Court speaking through Lahiri, J. observed that solatium was not provided under the 1952 Act perhaps for the reason that 'open market' contemplated a bargain between a free buyer and a free seller, unsaddled by the consideration of requisition and consequent acquisition. However, we are also of the opinion that what meaning should be attached to the terms 'compensation' and 'open market' has to be appreciated by referring to the other provisions of the Act itself and of such provisions the important one is obviously that conferring jurisdiction on and defining the manner of exercise thereof by, the arbitrator. For this we adverted earlier to the expression 'shall have regard to the circumstances of each case' occurring in Sub-clause (e) of Section 8 (1) and also to the provisions of Section 7. These are additional factors to be considered in determining compensation under 1952 Act which require determination of the 'price' which the requisitioned property would have fetched in the 'open market' and do not derogate from the usual consideration that weigh with the Court in determining 'market value' under Section 23 (1) of the 1894 Act. The arbitrator was, therefore, required to determine the 'compensation' under the 1952 Act keeping in view these principles. Indeed all considerations which weigh with the reference Court in determining the 'market value' under the 1894 Act must also inform the decision of the arbitrator who is further required under the 1952 Act to take into account the particular 'circumstances of the case'.
7. As we examine the evidence in this case we find that there is no escape from the conclusion that the learned arbitrator has not taken into account the potential value of the land on the date of acquisition, The claimant's testimony which remains un controverted is to the effect that there is a market, and a hospital neat the land and there are also mills and other workshops also in the area surrounding the land since prior to acquisition. She also states that the land is about 4 miles from Tezpur town and it abuts on the main road leading to the town via Darrang College and that it was a high land suitable for building site. Indeed P. W. 4 categorically deposes that a military Cinema hall was about 100 to 150 yards from the main Chariali and it is not disputed that this Cinema hall is the same which was constructed on the acquisitioned land. The topography and situation of the land is given by the claimant's witness, particularly P. Ws. 1, 2 and 4 from which it is evident that it was a valuable building site, enjoying the vicinity of a College, a hospital, a market and also the important cross-road, 'Chariali'.
8. In Collector of Raigarh v. Harising, AIR 1979 SC 472, their Lordships of the Supreme Court sustained the valuation taking into account the potentiality of the land as a building site. It was observed that proximity to residential, commercial and industrial areas and educational, cultural or medical institution should be considered in determining the potential value of an acquired land. Indeed these very considerations have been ignored by the learned arbitrator in this case despite the fact that there was evidence on this point which we have referred above in our discussion.
9. We are also inclined to consider that particular 'circumstances of the case' which the learned arbitrator was required to consider under Section 8 (1) (c) have been ignored. Firstly, he has not considered Whether any endeavour was made to arrive at an agreement as required by Section 8 (1) (a) so that the prescribed authority could itself have taken into consideration the peculiar facts and circumstances of the case and the claimant was not deprived of the 'just' compensation. Secondly, he has not considered the effect of the violation of the provisions of Section 7 (3) by which also the claimant was deprived of 'just' compensation. It is in this regard that payment of total amount ('compensation') under 1894 Act to the claimant's brother (P. W. 2) for the adjacent plot of similarly situated land contemporaneously requisitioned for the same purpose becomes relevant as a 'circumstance' of the case under Section 8 (1) (e) of the Act. It is in evidence in this case that the claimant's land remained vacant and unused during the period of requisition and the claimant herself admits in her evidence that whatever construction was made on it, including the Cinema Hall, these were after the acquisition. The acquisition was thus clearly violative of the provisions of Section 7 (3), Further the evidence does not show that there was any rise in price of the land of the locality between 1970 and 1973. Therefore; the different dates of acquisition of the respective plots have no bearing on this aspect of the case. Indeed, the learned arbitrator, could not have entertained any plea challenging the legality of the acquisition but the effect of the violation of either Section 8 (1) (a) or Section 7 (3) was most relevant consideration even for the purpose of determination of 'just compensation' payable to the claimant under Section 8 (3) of the Act.
10. We have been, however, persuaded further by Mr. J. N. Sarma to accept Exhibits 1 and 2 for the purpose of fixing the compensation payable to the claimant but we feel that it is not possible for us to do so and we hold that the learned arbitrator had rightly refused to accept them as evidence of comparable sales. But Ext. 1, a small plot of 4 kathas of land was purchased at the rate of Rs. 5,100/- per katha. This land is one the North Trunk Road and not on the same road on which the acquisitioned land is situated and it has admittedly better advantages, such as its proximity to Tezpur Town. The sale, vide Ext. 2 was impugned in this case as a sham transaction as it was made by the claimant to her cousin sister for a small plot, namely, 3 kathas, at the rate of Rs. 13,500/- per bigha. The learned arbitrator upheld the objection of the Collector, rightly in our opinion, on the ground that this document was created after the proposal for acquisition of the land was made on 24-3-69. It is a settled law that when valuation is sought to be fixed on the basis of comparable sale such sale must be genuine. However, we also feel that this document as well as Ext 1, are not relevant on the same ground, namely, the area sold is very small compared to the area acquired in this case. The mete fact that the sales evidenced by Exts. 1 and 2 are contemporaneous in time cannot have overriding effect.
11. We are also of the opinion that there is an apparent difficulty in fixing valuation of the acquired land in this case by applying the blockwise rule because the extent and existence of such facilities as severage, drainage, water, electricity, etc., in and around the acquired land cannot be ascertained from the evidence on record despite the fact that we have accepted the acquired land as a building site. Indeed no materials at all are available on record which would enable us to adopt blockwise valuation.
12. In this view of the matter we feel whether we take the potential value of the land and give a rise of Rs. 2,000/- per bigha on that consideration to the claimant or accept the 'compensation' paid to P.W. 2. aS the yardstick in view of Section 8 (1) (e) and (3) we arrive at the same conclusion. It cannot be denied that 'just compensation' has to be assured under Section 8 (1) (e) of the 1952 Act and on that consideration we will be justified in fixing the 'compensation' payable to the claimant under Section 8 (3) at the rate of Rs. 11,000/- per bigha. In this connection reference may be profitably made to the observation of Bhagwatj, J. in Krishna Yachendra v. City Improvement Trust Beard, AIR 1979 SC 869, which we quote (para 3):
'We are conscious that the process of determination of market value adopted by us may savour of conjecture or guess but the estimation of market value in many cases must depend largely on evaluation of many imponderables and hence it must necessarily be to some extent a matter of conjecture or guess.'
13. What the Court has, therefore, to do in assessing compensation payable to a person whose land has been acquired compulsorily is, therefore, to see that he is treated justly and fairly and in the facts and circumstances of the case a fair compensation is assessed having due regard to relevant legal provisions although there may be some amount of guess work involved in the process. The only material consideration which the Court should not overlook is that the guidelines adopted and accepted by the Apex Court, which is the law of the land, are borne in mind and by paying due regard to the provisions of the law applicable to the case reliance on pure guess work is avoided.
14. The only ether point urged on behalf of the claimant by her counsel is about interest on which the learned arbitrator has not said anything in his judgment. It is found that in the petition for reference, a claim is made for interest at the rate of 6% per annum on the total amount of the compensation. It has been rightly contended that it was incumbent on the learned arbitrator 1o deal with this point of the claim also and to give his decision thereon. It has also been contended by Mr. Sarma that although there is no specific provision for payment of interest under the 1952 Act as under the 1894 Act it is within the discretion of 1his Court even at this stage to consider the point and to foward interest in the absence of a specific bar in the 1952 Act disentitling this Court in this behalf.
15. In view of two direct decisions of this Court on this point we have no hesitation to accept Mr. Sarma's submissions. It was held by our learned brother Lahiri, J. in D. C. Kumrup v. Kalicharan Kalita (F. A. 109-130 of 1973, decided on 2-9-81) that it was within the ambit of the powers of the arbitrator under Section 8 of the Act to award costs in lieu of interest but it was also noted in that case that there was no contest on this point by the other side. However, in a later decision, Naren Chandra Kalita (supra) it was held by the Court that award of interest at the rate of 6% per annum by the arbitrator from the date of taking possession of the land by the Govt. was not in violation of any law and/or principles of justice, equity and good conscience and further that it was in accord with the law laid down by the Supreme Court in Satinder Singh v. Umrao Singh, AIR 1961 SC 908. Indeed, Satinder Singh's case was also relied on in another Bench decision of this Court in AIR 1973 Gauhati 119 (Ramesh Chandra v. D. C. & Collector) to hold that although D. I. Act did not specifically provide for payment of interest, it had to be paid in a case of acquisition made thereunder.
16. In the facts and circumstances of the case, in Naren Kalita (supra), interest was awarded from the date of making of the award by the learned arbitrator till the date of payment at the rate of 6% per annum. This was done apparently for the reason that under the 1952 Act the claimant was entitled to a recurring compensation for the period during which the property remained in the possession of the Govt. prior to acquisition and in awarding the interest the learned arbitrator had not taken this aspect into consideration. But in this case we find that the learned arbitrator has not only not awarded any interest he has not even applied his mind to the claim made on this count in the petition on which he was adjudicating. Accordingly, the claimant in this case is entitled to interest for the period from the date of the acquisition, as claimed in the petition, for the reason that on and from that date she lost her right to recurring compensation and she became, instead, entitled to full compensation for the property in which she lost all manner of rights which got vested in the Govt. on and from that date.
17. In the result F. A. No. 51/74 is allowed. We direct that the appellant shall be paid compensation under Section 8 of the 1952 Act for the acquired land at the rate of Rs. 11,000/- per bigha and on the total amount due to her she shall be paid interest at the rate of 6% per annum from the date of acquisition of the land till the date of final payment on the question of costs also it appears that the learned arbitrator has overlooked the provisions of the relevant rules (Rule 10 of the Requisitioning and Acquisition of Immovable Property Act, 1952) which invest the arbitrator as well as the High Court in appeal with the discretion to award costs. Accordingly, we hold that the claimant-appellant is entitled to costs of Rs. 500/- which shall be paid to her in addition to the amount of compensation and interest awarded by us. We further direct that the Collector, Darrang, shall pay the amount due to the claimant in terms of one order within a period of 3 months from this date.
18. In view of any decision in F. A. 51/74 the cross appeal filed by the Collector (F. A. 61/74) fails and it is dismissed, but we make no separate order for costs therein in view of the above facts and of the concession fairly made by the learned Govt. Advocate.
19. I have read with benefit the laboured judgment of any learned brother. While agreeing with him in his conclusion. I wish to state that according to me the open market price would not include the solatium payable in cases of requisition under the 1894 Act, though all the matters mentioned in Section 23 (d) of that Act can be, and has to be, allowed in cases of acquisition under the 1952 Act. To allow solatium to be paid in cases covered by the later Act on the score that 'open market price' would include it, amount to granting of solatium indirectly which has not been provided for directly in the Act and as such really excluded.
20. In this view of the matter, I would not have agreed to the enhancement of Rs. 2,000.00 per bigha in this case because that figure has really been arrived at by keeping in view what was paid to P.W. 2, a brother of the appellant, for acquisition of his land under the 1894 Act which specifically provides for payment of solatium. Nonetheless, my agreement is partly due to the fact that proper consideration was not paid by the learned arbitrator to the aspect relating to potential value of the land. This apart, one circumstance of the case which has been highlighted in the main judgment, namely, violation of Section 7 (3) of the 1952 Act has also weighed with me, albeit somewhat, to agree to the proposed enhancement. This is so became if the land could not have been compulsorily acquired, it may be that the landowner would have been able to sell it subsequently, and it may as well be that be would have got higher price.
21. A reading of the judgment of my noble brother shows that in fact he has awarded for the acquisition made in 1976, what was assessed for the acquisition made three years' later. Now, it is correct that there is no evidence on record to show whether there was any rise in the price of the land in the locality between 1979 and 1973. But it could be said reasonably that a judicial notice could be taken of the fact that land prices have been gradually rising. Of course, the acquired land was about four miles from the main town and as such there is ground to think that natural increase to the prices during three years in question might not have been significant.