1. This appeal arises out of proceedings for acquisition of survey No. 2, area 8 acres 2 gunthas, situated at Paused owned by the respondents. A notification under Section 4 of the Land Acquisition Act, 1894, issued by the then Government of Madhya Pradesh on 29-3-1955 in respect of 8 acres 2 gunthas of land out of survey No. 2 of Paused, district Yeotmal, as the land was needed for construction of Government I. E. M. Girls School. Possession of 8 acres of land was taken under the emergency clause in Section 17(2) of the Act on 29th July, 1955. This land originally belonged to respondent No.1 Bapurao and his wife Laxmibai respondent No.2, who effected a partition between themselves and their sons by a partition deed dated 7-12-1949. By virtue of this partition half the area of the filed fell jointly to the share of Bapurao, and Laxmibai and six remaining respondents, who were all sons of Bapurao, got equal share in the remaining half portion of the land. Two acres and 10 gunthas out of this land were diverted for non-agricultural purposes, but admittedly till the date of taking possession the field was being put in agricultural use.
2. Before the Land Acquisition Officer the landholders made a claim for a total compensation of Rs. 2,00,919/- which included Rs. 7000/- on account of price of the well in the field and Rs. 650/- on account of price of the standing trees. There were 17 trees on the Dhura. The Land Acquisition Officer determined Rs. 5200/- as market value of 8 acres of land Rs. 150/- as compensation for the well, Rs. 100/- as compensation for 17 trees and Rupees 817/8 on account of solatium of 15% for compulsory acquisition of land. He thus awarded a total compensation of Rs. 6267/8/- to the landholders.
3. The landlords did not accept the award and they, therefore, asked for a reference to be made to the Civil Court. They file an application under Section 18 of the Act with the Naib Tahsildar attached to the office of the Land Acquisition Officer on 4th July, 1959. In this application they claimed compensation at the rate of 50 Np. per square foot and they thus made a claim of Rs. 1,74,240/- as the value of 8 acres of land at that rate. They claimed Rs. 7,000/- on account of compensation for the well and Rs. 650/- as compensation for the trees. In addition to these they claimed Rs. 1126/- which was the amount of premium, which was paid by them for getting 2 acres 10 gunthas of land converted to non-agricultural purposes. In addition to these amounts Rs. 27,442/- were claimed by way of solatium at 15% under Section 23(2) of the Act. The total compensation claimed by the landlords thus was Rs. 2,10,467/-. They also wanted the compensation to be paid to all the respondents and not only to the respondent No.1, as was done by the Land Acquisition Officer, because, according to them, the land survey No.2 was already partitioned in 1949 between all the respondents. The Land Acquisition Officer had not awarded any interest and they, therefore, claimed that they were entitled to the interest under Sections 28 and 34 of the Act from 29th July, 1955 till actual payment of the amount was made to them.
4. The quantum of compensation claimed by the respondents was contested by the State. According to the State, the compensation awarded by the Land Acquisition Officer was proper and the respondents were not entitled to claim Rs. 1126/- which was the premium paid to the State Government, because, according to it, the land itself was being valued as the land used for non-agricultural purposes.
5. After the reference was made by the Land Acquisition Officer an application was filed on behalf of the State alleging that the award of the Land Acquisition Officer was communicated on 25-5-1959 to the counsel who appeared for the landlords before the Land Acquisition Officer and that the period of limitation for presenting an application for reference under Section 18 of the Act expired on 6th July, 1959. According to the landlords, the award was communicated to their counsel on 17th June, 1959. It appears that the contention was that the application under Section 18 of the Act was not made within 6 weeks from 25-5-1959 as provided by Section 18(2) of the Act and that the Naib Tahsildar who accepted the reference application on 4th July, 1959 was not properly authorised to accept the application. It appears that the reference application actually reached the Sub-Divisional Officer after the expiry of 6 weeks from 25-5-1959 and it was therefore, contended that the reference application having reached the Land Acquisition Officer after the expiry of 6 weeks from 25-5-1959 it should have been rejected as barred by time while the landlords' case was that the award having been communicated to their counsel on 27-6-1959, the application must be deemed to have been filed within time.
6. The reference made by the Land Acquisition Officer was dealt with by the Court of the Civil Judge, Senior Division, Yeotmal, and the Court took the view that the Naib Tahsildar was a subordinate officer in the officer of the Sub-Divisional Officer and that his endorsement shows that the application was received by him on 4th July, 1959 and consequently the application must be deemed to have been received in the office of the Land Acquisition Officer on that date. Dealing with the question whether the compensation determined by the Land Acquisition Officer was correct or not, the trial Court found that the acquired land had a very find situation as land usable for the purpose of residence. It found that to the East of the acquired land there was a public road and beyond the road were plots Nos. 1 to 15 which were in survey Nos. 7 and 8, which plots were known as Civil Ward or Navin Basti and on these plots the bungalows of very well-to-do people such as lawyers and landlords were situated. On the South side there was a ginning factory. On the Western side there was a road which ran from Gaothan towards Gokul Dosa Ginning Factory and beyond the road were fields survey Nos. 107 to 110 to which the town Planning Scheme was made applicable. On the Northern side of the acquired land are residential quarters of Civil Judge. Sub-Divisional Officer, Police Sub-Inspector and other Government servants and beyond these residential quarters were situated Government offices such as Police Station, Tahsil Office and Civil Court. The Gaothan was also situated on the Northern side. Having regard to the general situation of the acquired land which was surrounded at least on two sides by residential localities, the trial Court found that for the purposes of granting compensation the land should not be treated only as agricultural land, but the potential value of the land as a site for building purposes must be taken into consideration.
7. The respondents in this case had given voluminous evidence and had produced several sale-deeds, which, according to them, were useful or determining the value of the acquired land and oral evidence was also given. A large number of sale-deeds w ere, however, rejected by the Court for different reasons. Exs. A-24 A-33 and A-35 were rejected because they related to sites used for industrial purposes. Exs. A-26, A-27 and A-36 were also rejected because these plots were situated in a commercial locality of Paused in the midst of the old town of Paused. On behalf of the State reliance was placed on 3 transactions. Ex. N-A-2 which evidenced a transaction of sale of 11 acres 17 gunthas of land from S. No. 112 of Paused and purchased by the President of Paused Municipality for Rs. 5958-12-0 on 10th April, 1957 was rejected for several reasons. It was found that to the East of survey No. 112 was survey No. 111 and between survey No. 111 and the Gaothan there were four big fields survey Nos. 107 and 110 and there was no Basti in these four survey numbers. It was also found that the situation of survey No.2, which was the acquired land, and survey No. 112 could not be compared and that S. No. 112 was purchased by the Municipality to provide residence for labour class and its employees and this was done with a benevolent purpose. This transaction, according to the learned Judge, could not be a fair guide to determine the value of the land. Similarly Ex. N-A-3, which was a sale-deed of 1st July, 1957 executed by one Vasant Nana Erawar in favour of the President of Griha Nirman Sahakari Sanstha by which 22 acres 27 gunthas of land from survey No. 111 was sold for a sum of Rs. 14,738.75, was also rejected because the situation was not comparable. The State had relied on auction sales of survey Nos. 93, 91, 95, 74, 173, 175, 50, 99, 151 and 135 belonging to one Eknath Bellappa, which were sold in execution of a decree obtained by one Godhaji Sakharam. Having found that these sales were forced sales, the trial Court left them out of consideration. The trial Court then proceeded to examine the evidence of an architect given on behalf of the claimants-respondents. The architect A. W. 17 Anant Deopujari deposed to the expenses of making a lay-out of the acquired land with plots each having an area of 5000 square feet. He found that the total area under plots would be 3,48,480 square feet and out of these 65500 sq. feet would be under road, 20150 sq. feet would be under lanes, 42300 sq. feet would be under park and 2450 sq. feet would be under dust bin. Thus according to him 3,48,480 sq. feet area would not be available as plots and out of 3,48,480 sq. feet only 2,18,080 would be available for the purposes of plots. From this he deducted 5000 sq. feet on account of open space which would have to be left for Dharmashala which is situated on the Western side of the plots in question. Thus the total are which would be available for being sold as plots according to the architect, was 2,13,080. The expenses of development including costs of roads, lanes, culverts and drains were calculated at Rs. 21,340/-. When it was objected before him that 10 feet lane would be too narrow and it should really be 15 feet width, making allowance for this additional expenditure the learned Judge came to the conclusion that the cost of layout would come to the round figure of Rs. 25,000/-. He found that these costs of development were supported by the evidence of Dattatraya Sarnaik (N.A.W.2) who had also purchased land from survey No. 111 for being used by Municipal employees for residence and developing it. The learned Judge found that if the plots were laid out in the acquired land there would be good customers for the same. Coming to the rate at which the plots should be valued, the learned Judge left out of consideration sale-deeds Exs. A-19, A-21, A-23, A-25, A-30, A-31, A-32 and A-37, the earliest of which was Ex. A-21, that is, dated 21st April, 1956. The other sale-deeds related to the years 1957-58. The learned Judge found that these were post notification sales and were not of any assistance. Nearest in the point of time, according to him, was the sale transaction dated 19th December, 1953 evidenced by Ex. A-20 which showed that 8 gunthas of land of plots Nos. 76 and 77 situated in survey Nos. 7 and 8 was purchased by the President of the Co-operative Bank, Paused for Rs. 5500/-. The rate, according to the learned Judge, came to 63 Np. or 10 annas per sq. feet and it was this rate which, according to him, should be applied for the purpose of determining compensation payable to the landlords in respect of 2,13,080 sq. feet which was the salable area under the plots. He found that the value of 2,13,080 sq. feet at the rate of 10 annas would work out to Rs. 1,33,175/-. From this he deducted the development costs of Rs. 25,000/- and Rs. 4000/- on account of conversion charges in respect of 8 acres including amount of Rs. 1125/- which was already paid as conversion charges. Having made all these deductions the learned Judge found that the market value of the acquired land would be Rs. 1,05,300. In addition to this he found that the landlords were entitled to Rs.100/- in respect of 17 trees standing on the land. He declined to grant any separate compensation in respect of the well, though he found that the cost of the w ell in 1955 would be Rs. 8518/-, the landlords had claimed only Rupees 7000/-. Thus including 15% solatium of Rs. 1,05,300 and Rs.100/- which came to Rs. 15,810/- the landlords were found entitled to the compensation of Rupees 1,21,210/-. Deducting Rs. 6267/- which was the compensation awarded by the Land Acquisition Officer, the Court held that the claimants were entitled to Rupees 1,14,943/-, in addition. Since, according to the learned Judge, the amount was a large one, that is, over a lac of rupees he granted interest only at 3 per cent, per annum on Rupees 1,11,210/- (this appears to be a mistake for Rs. 1,21,210/- from 29th July 1995 till 30-6-1959 and thereafter on Rs. 1,04,943/- (this appears to be mistake for Rs. 1,14,943/-) because Rupees 6267/- were already deposited in Court on 30th June, 1959. Accepting the partition made inter se by the respondents compensation in respect of 4 acres of land was directed to be paid to the respondents Nos. 1 and 2. Bapurao and Laxmibai and remaining compensation was to be divided among 6 sons of Bapurao, namely, the respondents Nos. 3 to 8 in equal shares.
8. The State of Maharashtra as well as the claimants are aggrieved by this judgment. The State of Maharashtra, therefore filed an appeal challenging the determination of the compensation by the learned Judge. The claimants also filed a cross-objection in respect of the claim which was negatived by the learned Judge with regard to the quantum of compensation. In the cross-objection a grievance is also made that the claimants were entitled to Rs.7,000/- on account of the value of the well and Rs. 650/- on account of the value of the trees. A grievance is also made about the rate of interest as also against the order relating to costs because only half the costs were awarded to the claimants.
9. When the appeal filed by the State came up for hearing, a preliminary objection was raised on behalf of the respondents that the appeal filed by the State was not maintainable, because the appeal really has been filed by the Collector and that the State is not entitled to file an appeal challenging the decision of the Court regarding determination of compensation. The learned counsel appearing on behalf of the respondents has referred to a decision of Tendolkar. J. in. In re Jerbai Mehta, : AIR1950Bom243 in which the learned Judge has held that the only person who is entitled to appear in a reference relating to compensation is the Collector as defined in Section 3(c) of the Act and hence the Government has no locus standi and in cases relating to apportionment, neither the Collector nor the Government have any locus standi whatever. That decision was given in a reference made under Section 18 of the Land Acquisition Act which came before the High Court in its original jurisdiction. Appearance was put in on behalf of the State and the counsel for the claimant raised a question as to whether the Government was entitled to appear on a reference under Section 18. The learned Judge held that under Section 20 the Court was required to issue a notice to the Collector if the objection of the claimant was in regard to the area of land or to the amount of compensation and on a review of the several provisions of the Act, the learned Judge found that after the Government has made a reference under Section 6 of the Act they drop out of the proceedings completely and it is only the Collector who is entitled to appear on the reference. The learned Judge held as follows :
'But having regard to the entire scheme of the Land Acquisition Act I am satisfied that the only person who is entitled to appear in a reference relating to compensation is the Collector as defined in Section 3(c) of the Act and that in cases relating to apportionment, neither the Collector nor the Government have any locus standi whatsoever.'
The learned Judge also considered the fact that it was the duty of the Collector and not of the Government to make a reference under Sections 18 and 19 regarding compensation or apportionment of compensation as well as under Section 30 in respect of apportionment, and such a reference ought to have been forwarded to the Court either by the Collector himself or a person duly authorised by him in that behalf.
10. Now, in our view, this decision must be restricted to the question as to who was entitled to appear in a reference under Section 18 by the Collector. The question whether after the Court had given a decision on merits enhancing the compensation which was originally awarded by the Collector, the appeal should be filed only by the Collector and not by the State Government, did not arise for decision in that case at all. The learned counsel for the respondents then relied on certain observations of a Division Bench of this Court in Shankarlal v. Municipal Committee, Paused. F. A. Nos. 98 and 128 of 1958, decided on 29-1-1965 (Bom.). An appeal arising out of a land acquisition matter was filed by the State of Bombay through the Collector of Yeotmal district and a Division Bench held that having regard to the observations in Jerbai's case : AIR1950Bom243 (citsupra) the State of Bombay was not a proper party at all and ought not to have been allowed to file the appeal. However, since the Collector was already on record, it was held that the proper party was already on record and the appeal could be proceeded with. Now, as we have already pointed out above the decision in the case of re Jerbai did not directly deal with the question whether the State is entitled to file an appeal challenging the decision of the Court on a reference under Section 18 of the Act. This decision was cited before another Division Bench of this Court in Extra Assistant Director of Agriculture, Government of Bombay v. Ch. Chandrashakhar, F. A. No. 82 of 1963, D/- 6-8-1970 (Bom). In that case the appeal was filed by the Extra Assistant Director of Agriculture, Government of Bombay (now Government of Maharashtra). Agriculture Department at Nagpur. An objection like the one which is raised in the appeal before us was raised at the hearing of the appeal and reliance was also placed on the decision in Jerbai Mehta's case : AIR1950Bom243 . The decision in Shankarlal's case (1965) F. A. Nos. 98 and 128 of 1958. D/- 29-1-1965 (Bom.) referred to above was cited and the Division Bench held that in the earlier decision it was accepted that the only person who was entitled to appear in a reference relating to the compensation was the Collector as defined in Section 3(c) of the Act. However, the real controversy in F. A. No. 82 of 1963, D/- 6-8-1970 (Bom.) was not whether the State could file an appeal against the decision of a Court on a reference under Section 18, but the question was whether an appeal filed by the Extra Assistant Director of Agriculture was competent. The argument on behalf of the appellant in that case was that the acquisition having been made for the department of agriculture of the State, the Extra Assistant Director of Agriculture, as a representative of that department, was a person interested in the acquisition of the land and being a party to the proceedings must be deemed to have had a right to seek a reference under S. 18 of the Land Acquisition Act. It was this contention which was decided and the Division Bench held that the Collector represented all the interests, namely, of the State as also of any such acquiring body with whose funds and for whose benefit any land is acquired, and therefore, they did not accept the submission made on behalf of the appellant that the Extra Assistant Director of Agriculture was a person interested in the acquisition proceedings before the Collector and that therefore he had a right to appear in the subsequent proceedings. It is significant to note that though the earlier decision of the Division Bench in Shankarlal's case was positively cited, the learned Judges concurred with the view which was taken by a Division Bench of the Nagpur High Court in R. S. Deoji Dharsi v. Ghisulal AIR 1953 Nag 256. In the Nagpur case the Division Bench had taken the view that the party competent to file an appeal against the decision on a reference under Section 18 of the Act was either the Collector or the Provincial Government but not a company for whose benefit acquisition proceedings were taken. Citing this decision with approval, the Division Bench observed:
'This decision is therefore a specific authority that the only person who could seek a reference under Section 18 was the claimant and the only person who could challenge the decision of the District Judge in the reference under Section 18 was either the Collector or the Provincial Government and in any case not the requisitioning body.' With respect, we are of the view that these observations correctly set out the legal position with regard to the right of the State Government to file an appeal against an order determining compensation on a reference made under Section 18 of the Act. The Division Bench also agreed with the view taken by the Gujarat High Court in Gautamlal v. Land Acquisition Officer. : AIR1970Guj81 in which it was held that the only parties to the reference under Section 18 were the claimants on the one hand and the Collector on the other because in the acquisition proceedings the Collector represents all the interests, namely of the State as also of any such acquiring body with whose funds and for whose benefit any land is acquired. It thus appears to us that the observations made by the Division Bench in Shankarlal's case that the State could not file an appeal against an order of a reference made under Section 18 of the Act were not accepted by the later Division Bench and indeed those observations are not supported by the decision in Jerbai's case : AIR1950Bom243 on which reliance is placed by the Division Bench.
11. Apart from this, it appears to us that when the Collector acts in proceedings relating to acquisition of land or for determination of compensation in respect of the acquired land, he acts entirely on behalf of the State Government and the object of the enquiry made by him which finally culminates by an award is merely to determine a sum which the State can offer to the person whose property is being acquired as compensation for the land which is the subject-matter of acquisition. This position has been settled by a decision of the Privy Council in Ezra v. Secretary of State for India, ILR (1905) Cal 605 . The question there was whether the land acquisition Collector was a Judicial Officer. The Calcutta High Court had taken the view that throughout the proceedings the Collector acts as an agent of the Government for the purposes of acquisition, clothed with certain powers to require the attendance of persons to make statements relevant to the matters which he has to enquire into and he is in no sense of the term of Judicial Officer; nor was the proceedings before him a judicial proceeding. Considering the provisions of the Act, the Calcutta High Court in Ezra v. Secretary of State for India, ILR (1903) Cal 36 against which the Privy Council was deciding the appeal held:
'The meaning to be attached to the word 'award' under Section 11 and its nature and effect must be arrived at not from the mere use of the same expression in both instances, but from the examination of the provisions of the law relating to the Collector's proceedings culminating in the award. The considerations to which we have referred, satisfy us that the collector acts in the matter of the enquiry and the valuation of the land, only as an agent of the Government, and not as a Judicial Officer; and that, consequently, although the Government, or the Company at whose instance the Government are acquiring the land, are bound by his proceedings, the persons interested are not concluded by his finding regarding the value of the land or the compensation to be awarded. His enquiry and his valuation are departmental in their character, for the purpose of enabling the Government to make a tender, through him, to the person interested. Such tender once made is binding on the Government, and the Government cannot require that the value fixed by their own officer acting on their behalf, should be open to question at their own instance before the Civil Court.'
(Underlining is ours)
This view taken by the Calcutta High Court was approved by the Privy Council in an appeal against the same decision and the Privy Council referring to the contentions raised before it observed :
'Shortly stated, the appellant's objection is that the Collector, who conducted the enquiry and made the 'award' availed himself of information supplied to him without the knowledge of the appellant and not disclosed at the enquiry. It is not suggested that there was in the proceedings anything corrupt or fraudulent and the objection is based and depends upon the theory that the enquiry by the Collector was a judicial proceeding and that the rules of judicial proceedings apply. The argument of the appellant starts from the word 'award' (which is used to describe the conclusion of the Collector) and has nothing else to support it. When the sections relating to this matter are read together, it will be found that the proceedings resulting in this 'award' are administrative and not judicial; that the 'award' in which the enquiry results is merely a decision (binding only on the Collector) as to what sum shall be tendered to the owner of the lands; and that, if a judicial ascertainment of value is desired by the owner, he can obtain it by requiring the matter to be preferred by the Collector to the Court. The sections directly relevant (besides the 9th already set out) are the 11th, 12th 13th, 14th, 15th and 18th. These sections, and the question as a whole are very satisfactorily discussed in the judgment under appeal, and their Lordships do not think it necessary to repeat the reasoning. It is, to say the least, perfectly intelligible that the expert official charged with the duty of fixing a value should be possessed of all the information in the hands of the department, and it should at the same time avail himself of all that is offered at the enquiry his ultimate duty being not to conclude the owner by his so-called award, but to fix the sum, which in his best judgment is the value and should be offered.
(Underlining is ours)
12. These observations of the Privy Council were quoted with approval by the Supreme Court in Raja Harish Chandra v. Deputy Land Acquisition Officer, : 1SCR676 . In that case the question before the Supreme Court was what was the construction to be placed on the phrase 'the date of the Collector's award' in proviso (b) to Section 18(2) of the Act. In dealing with that question the Supreme Court has made certain observations with regard to the nature of the legal character of the award made by the Collector under Section 12. In para 5 of the judgment it was observed :
'In a sense it is a decision of the Collector reached by him after holding an enquiry as prescribed by the Act. It is a decision, inter alia, in respect of the amount of compensation which should be paid to the person interested in the property acquired; but legally the award cannot be treated as a decision; it is in law an offer or tender of the compensation determined by the Collector to the owner of the property under acquisition. If the owner accepts the offer no further proceeding is required to be taken, the amount is paid and compensation proceedings are concluded. If, however, the owner does not accept the offer. Section 18 gives him the statutory right of having the question determined by Court, and it is the amount of compensation which the Court may determine that would bind both the owner and the Collector. In that case it is on the amount thus determined judicially that the acquisition proceedings would be concluded. It is because of this nature of the award that the award can be appropriately described as a tender or offer made by the Collector on behalf of the Government to the owner of the property for his acceptance.'
(Underlining is ours)
Then quoting the observations from the decision of the Calcutta High Court in Ezra v. Secretary of State ILR (1905) Cal 605 the Supreme Court further observed :
'The said case was taken before the Privy Council in Ezra v. Secretary of State, ILR (1905) Cal 605 , and their Lordships have expressly approved of the observations made by the High Court to which we have just referred. Therefore, if the award made by the Collector is in law no more than an offer made on behalf of the Government, to the owner of the property then the making of the award as properly then the making of the award as properly understood must involve the communication of the offer to the party concerned.'
The Supreme Court then held that the date of the award cannot be determined solely by reference to the time when the award is signed by the Collector or delivered by him in his office; it must involve the consideration of the question as to when it was known to the party concerned either actually or constructively and if that be the true position then the literal and mechanical construction of the words 'the date of the award' occurring in proviso (b) to Section 18 (2) of the Act would not be appropriate.
13. We must, therefore, proceed on the legal position that the Collector, when he makes an award makes an offer on behalf of the Government to the owner of the property. Indeed, while making the award as also in the proceedings antecedent to the making of the award he is functioning as an agent of the Government. As a Collector as such he is not a person who has to pay compensation which is paid out of the funds of the Government. The real person who would be interested in challenging the enhanced compensation made by the Court, is the principal, namely, the Government, and it is difficult to see how if the Government's agent, namely, the Collector could file an appeal challenging the enhanced compensation by the Court the principal itself would, be incompetent to file such an appeal. Any appeal which is filed by the Collector would be filed on behalf of the principal, but merely because normally appeals are filed by the Collector functioning as Land Acquisition Officer, it does not mean that if an appeal is filed by the Government and not its agent the appeal would become incompetent.
14. We may also point out that one of the learned Judges Kotwal J. (as he then was). who decided Shankarlal's case had taken the view in Corpn. of the City of Nagpur through the Chief Executive Officer v. Narendrakumar Motilal, : AIR1959Bom297 that in the entire proceedings from the time of the issue of the notification under Section 6 till the payment of compensation, the parties interested in the acquisition are in law the owner of the property and Government who acquires the property. The view taken in this decision was quoted with approval by a Division Bench of this Court in a very recent decision given by Kotwal C. J. and Nain J. in Himalayan Tile and Marble (Pvt.) Ltd. v. Francis V. Coutinho. : AIR1971Bom341 . Thus we are inclined to take the view that the real party who is interested in challenging the enhanced compensation is the State Government. No doubt normally it appears that appeals are filed in the name of the Collector, but instances are not wanting where appeals filed by the State itself have been entertained and decided, though such a challenge does not seem to have been made in any case. To give a few instances we might refer to a decision of the Supreme Court in Uttar Pradesh Govt. v. H. S. Gupta. : AIR1957SC202 and of the Allahabad High Court in State of U. P. v. Widow of Late L. Janki Das, : AIR1966All273 .
15. It is worthwhile referring to a very recent decision of the Supreme Court in Punjab University v. Acharya Swami Ganesh, : AIR1972SC1973 . In that case land was being acquired for the Punjab University and an appeal before the High Court was filed jointly in the name of the Punjab University and the State Government. The delay in filing the appeal was satisfactorily explained by the Punjab University without any explanation on the part of the State and the question was whether this was sufficient for the purposes of Section 5 of the Limitation Act and whether the delay could be condoned. In that case the delay had occurred, according to the Punjab University on account of the mistake of its counsel in computing limitation, because, according to the counsel, he had noted in his brief the last date for filing the appeal as February 11, 1971, while the appeal should have been filed by February 8, 1971. The explanation given by the counsel was rejected by the high Court because the High Court took the view that the right to file an appeal was that of the Punjab Government and the Punjab Government has not given sufficient reason for the delay in filing the appeal. The view that it was the Punjab Government, which had the right to file an appeal, was not doubted, but the Supreme Court held that the Government was only fighting the case for the benefit of the Punjab University. The following observations of the Supreme Court may usefully be quoted :
'It may be noted that the party which was essentially interested in filing the appeal was the Punjab University. It had to pay the compensation for the lands acquired. Therefore, there was nothing surprising if the Government had left the matters in the hands of the Punjab University. The Punjab Government was only fighting the case for the benefit of Punjab University. The facts stated by Mr. Atma Ram in his affidavit are highly probable and we see no reason to disbelieve the version given by him. If the version is believed, as we do, then it affords a good ground for condoning the delay in filing appeal. It is true that Mr. Atma Ram committed a mistake in his calculation. But that is not the same thing as negligence. In matters of calculation, it is common knowledge that people do commit mistakes. They are bonafide mistakes and those mistakes have got to be taken note of by the Courts in considering whether the delay in filing the appeal should be condoned or not.'
Before the Supreme Court it was urged that the Punjab Government could not take advantage of the mistake committed by Mr. Atma Ram and that it had not given any explanation of its own for not filing the appeal within time. Repelling this contention, the Supreme Court observed : -
'As mentioned earlier, Punjab Government had evidently left the matters in the hands of the Punjab University which was the party really interested. It depended entirely on the Punjab University. We see no reason why that course would be found to be improper.' We are inclined to treat this decision of the Supreme Court as holding that the appeal through the Punjab Government was properly filed, though the Punjab University was also additionally shown as an appellant. Thus if it was the State Government which was primarily interested in challenging the enhanced compensation in the instant case, we fail to see why the appeal filed by the State as such was not maintainable, though normally it appears that the practice was that an appeal was filed in the name of the Collector.
16. We may also point out that in the application for reference made by the respondents the State is shown as non-applicant and a party to the application. This reference when it came before the civil Court showed the State as a party to the reference, though appearance was put in by the Government pleader of Yeotmal on behalf of the State Government as such. The fact, however, remains that the State has been treated as a proper party to the proceedings right from the application made under Section 18 of the Act before the Collector till the decision given by the Civil Court. Obviously the decision given by the Civil Court clearly affects the State Government which has been shown as a party in the decision and that, in our opinion, would be an additional ground on which the respondents' objection that the appeal filed by the State is not competent should be rejected. The preliminary objection raised on behalf of the respondents is thus rejected.
17. x x x x x x
18. It is next contended that the decision of the trial Court is vitiated because the price of a small plot of land, namely, the one which is purchased by A. W. 11 Shri Natu pleader under Exhibit A-22 has been taken as indicative of the rate to the applied to a large plot of land consisting of 8 acres. This course, according to the learned counsel for the State, is not permissible and reliance is placed on a decision of the Supreme Court in Collector of Lakhimpur v. B. C. Dutta, : AIR1971SC2015 . In this case the Supreme Court observed that it was well known that when large area, like the one which was subject-matter of acquisition, had to be sold it could not possibly fetch a price at the same rate at which small plots could be sold. In that case an average price per katha was taken on the basis of 4 sale-deeds and with reference to that price the value of 5 Bighas, 4 Kathas and 3 Lechas of land in Dibrugarh district was determined. The facts show that at the average rate the price per Bigha was taken at Rs. 15,000/- by the high Court though those sale-deeds were rejected by the District Judge. The compensation which was awarded at Rs. 15,000/- per Bigha was, however, reduced to Rs. 10,000/- and the Supreme Court observed that although the average price of these sales came to Rs. 15,000/- per Bigha but when it was considered, that they were of comparatively much smaller area they would constitute good evidence for fixing the rate at a figure which was originally claimed by the respondent, namely, Rs. 10,000/- per Bigha. Now, even in this case which is relied upon on behalf of the State the sales of small plots have not been entirely left out of consideration but some allowance has been made and the average price which came to Rs. 15,000/- per Bigha on the basis of sales of small plots has been reduced to Rs. 10,000/- for the purposes of awarding compensation. The proposition that large area of land cannot possible fetch a price at the same rate at which small plots are sold is not an absolute proposition and in given circumstances, in our view, it would be permissible to take into account the price fetched by small plots of lands, especially in a case where compensation of land with building potentiality is to be determined and the land is to be valued. Having taken into account this building potentiality of S. No. 2 the prices fetched by neighbouring plots would serve as a good guide for determining the compensation. It cannot be forgotten that survey number 2, which is the land in question, is situated within the Municipal limits of Paused. On 2 sides it is surrounded by residential buildings occupied by well-to-do people. There appeals to be a scarcity of accommodation in Paused as deposed to by N. A. W. 2 Dattatraya Sarnaik. These facts must be taken into consideration while determining the compensation for survey number 2. In our view, the proper method of determining compensation in respect of such a land situated within the Municipal limits in a place where there is scarcity is surrounded by residential localities would be to find out how many residential plots of a reasonable size could be made out of the field in question. Allowance should be made for the land which would be required to be left vacant on account of roads lanes, park etc. and the land which would then be available for being sold as plots should be taken into account and to this land must be applied the rate at which normally plots were sold at about the date of notification under Section 4 of the Land Acquisition Act in adjoining areas, but from the price so calculated the cost of development should be deducted and the price so arrived could be treated as compensation for the whole of the acquired land. Such manner of determination of compensation is in our view clearly permissible. Merely because the land is agricultural and it is labelled as such does not necessarily mean that the land must be valued as agricultural land.
19. In State of Madhya Pradesh v. Man Mohan Swaroop, : AIR1966MP270 the Madhya Pradesh High Court observed that ordinarily it was wrong to value large areas on the basis of small area as well as Vice Versa, but all the same there may be cases when such a basis may be required to be adopted looking to the entire circumstances of the case and if the land acquired is found to be useful both for agricultural of non-agricultural purposes, merely on the ground that it was used as agricultural land by the owner till the time of its acquisition, its potentiality as non-agricultural land cannot be ignored. In Mrs. V. Conia Lal v. Collector of Madras, : AIR1966Mad82 it was pointed out that where a land was situated in a developed and busy locality but was by itself undeveloped before valuing the land as house site, allowance will have to be made for the space for roads and also for the cost of laying roads and of other amenities. The Punjab High Court has also found that such a method was permissible. In D. L. g. Housing and Construction (P.) Ltd. v. Union of India, it was pointed out that out of the plot table area the extent of land that would be lost for utilisation for roads is to be first deducted and then in respect of the remaining plot area the price had to be worked out at the rate payable for developed plots and from this price the development charges were to be deducted and the result would be the net price of the area of plots which could be taken as the basis for compensation payable in respect of the acquisition of the land. The plotting scheme and sales in respect of small area for determining the price of a large lot of land were also considered in : AIR1957SC202 . On facts in that case the Supreme Court held that the application of the principle, that if the land had to be sold in one block consisting of a large area the rate per square foot likely to be fetched would be smaller than if an equal extent of land was parceled out into smaller bits and sold to different purchasers could not reasonably be applied to the circumstances in that case. A large estate called Dilkusha Estate situated outside the city of Lucknow was sought to be acquired and the question was whether the price of plots which were sold per squire foot could be taken into account. The High Court had taken the view that certain plots were sold at Rs. 1-10-6 per sq. foot whereas other plots were sold at Rs. 1-13-0 per sq.foot and taking into account the fact that if the Estate was sold in one block it would have fetched one or two annas per sq. foot less. The compensation was made payable at 14 annas per sq. foot. The District Judge has granted compensation at the rate of Rs. 1-2-0 per sq. foot. The Supreme Court held that the High Court should have concentrated its attention on the price fetched for smaller extent of land similarly situated with the same kind of advantages and drawbacks and then applied that test to the facts in that case. The rate of compensation awarded by the District Judge was therefore, restored.
20. Even in the instant case, therefore, it appeals to us that the learned Judge was justified in taking into account the fact that after a proper development the total area which could be sold as plots would be 2.13.080 square feet. A part of the land was already permitted to be diverted to non-agricultural purposes. he has taken into account the evidence of A. W. 17 Anant Architect who had produced a lay-out which could have been made and the salable area would have been 2,13,080 sq.feet. What is contended by Mr. Moron behalf of the appellant-State is that the calculations made by the Architect were not correct and that he was not an expert valuer. Now A. W. 17 Anant Deopujari was not examined as a valuer. He was examined to show how much area could be sold out of survey number 2 as plots if it was used as a residential locality. So far as area which was to be left out of consideration is concerned, there is no challenge. The only challenge which is made is in the course of his cross-examination and that is with regard to the expenses which would be required for the purposes of making a lay-out. The learned counsel contends that the Architect has not personally seen the actual plots to see whether the boulders and other material would be available, and therefore the calculations with regard to the costs of laying of the roads and drains could not be accepted. The Architect has deposed in paragraph 25 of his deposition that he did not ascertain the distance on the basis of which lead was calculated, but the calculations were based on the information of lead supplied by Vasantrao. There is nothing on record to show that the statement made by Vasant that bounders would be available at the distance of one mile was erroneous nor has the State examined any witness to show that what Vasantrao was stating was incorrect. There was therefore no error in the Architect relying on the information supplied to him by Vasantrao who was himself a resident of Paused. Then with regard to the fact that the Architect did not make any trial pits in order to find the depth of the soil, it appears to us from the evidence of Vasantrao (A. W. 2) that the soil in S. No. 2 was murum soil and according to the Architect if the soil was murum soil the building costs will be little less than the black cotton soil, which he has taken into consideration. There is no evidence to show that the soil in survey number 2 was not murum soil. There is no material on record to doubt the calculations which are made by the Architect and which are produced by him in Exhibit A-29. On the basis of these calculations and making an additional allowance for about Rs. 4,000/- the learned Judge has found that the total expenses of development would be Rs. 25,000/-. the sale-deed in favour of Mr. Natu, which is in respect of a plot from the lay-out in survey numbers 7 and 8, which are immediately to the East Survey number 2, is proximate to the date of the notification dated 29-3-1955. The rate at which the plot was purchased by Shri Natu comes to about 10 annas per sq. foot and in our view the trial Court was justified in taking that rate into consideration having regard to the proximity of the two pieces of land.
21. Appeal dismissed.