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Ram Chander and ors. Vs. Union of India - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtDelhi High Court
Decided On
Case NumberRegular First Appeal No. 152 of 1968
Judge
Reported in15(1979)DLT318
ActsLand Acquisition Act, 1894 - Sections 4
AppellantRam Chander and ors.
RespondentUnion of India
Cases ReferredSecy. of Stale v. Charlesworth Pilling
Excerpt:
.....4 and 23 of land acquisition act, 1894 - land owners appeal for enhancement of compensation - market value of land to determine compensation must be based on ascertained transactions - evidence of specific purchases to be given as per section 23 - fictitious or speculative value cannot be taken into account - voluntary deal is essence of market value. - - the first is letter dated march 21, 1964. this was written by the deputy commissioner to the military estate officer in which he 'recommended for adopting in delhi cantt' rates for the purpose of revision of the standard table of rent prepared under rule 8 of the military land adminictration rules 1937. he recommended rs. he said :your orders are requested as to whether the possession of the said land be handed over to the..........of each to the owners as will appear from the following table :- block- 'a' rs. 1300.00 per bigha. block-'b' rs. 1200.00 per bigha. block-'c' rs. 700.00 per bigha on a reference under s. 18 of the act the additional district judge divided the land into two main classes. lands in blocks 'a' and 'b' he combined into one class. he called it block-1. for this block he awarded rs. 5350.00 per bigha. the lands comprised in block c he regrouped in block-ii for which he awarded rs. 2500.00 per bigha. from this decision the owners now appeal to this court for further enhancement. 0s'.behalf of the owners an instance of sale was produced in evidence. this sale was made on may 1,1964. one bigha of land was sold for rs. 5000/'-. the price works out to rs. 5.00 per square yard. this.....
Judgment:

(1) This appeal relates to the amount of compensation to be paid for the owner's land taken by the Government under statutory powers. The appellant's land situated in village Nangal Dewat was acquired by the Government for a public purpose, namely, for building a new terminal area at Palam Airport. Notification under S. 4 of the Land Acquisition Act (the Act) was issued on September 26, 1964. In due course the Land Acquisition Collector made his award (Award No. 1836) on July 12, 1965. The Collector classified the acquired lands into three categories and offered different compensation in respect of each to the owners as will appear from the following table :-

Block- 'A' Rs. 1300.00 per bigha. Block-'B' Rs. 1200.00 per bigha. Block-'C' Rs. 700.00 per bigha

On a reference under S. 18 of the Act the Additional District Judge divided the land into two main classes. Lands in blocks 'A' and 'B' he combined into one class. He called it block-1. For this block he awarded Rs. 5350.00 per bigha. The lands comprised in block C he regrouped in block-II for which he awarded Rs. 2500.00 per bigha. From this decision the owners now appeal to this court for further enhancement.

0S'.behalf of the owners an instance of sale was produced in evidence. This sale was made on May 1,1964. One bigha of land was sold for Rs. 5000/'-. The price works out to Rs. 5.00 per square yard. This transaction of sale was accepted by the Additional District Judge as a guide to the value of the land. Ho, thereforee, awarded Rs. 5350.00 to the owners. The sum of Rs. 350.00 was added to the value on account of the registration charges spent by the purchaser on the conveyance. As regards block-II he allowed 'corrcesponding enhancement' as he put it. Since he had increased the compensation for Collector's block-'A' land fourfold the Additional District Judge raised the compensation for Block 'C' hinds from Rs. 700.00 per bigha to Rs. 2500.00 per bigha.

In their evidence the owners produced two letters exchanged between the Government departments. The first is letter dated March 21, 1964. This was written by the deputy commissioner to the military estate officer in which he 'recommended for adopting in Delhi Cantt' rates for the purpose of revision of the standard table of rent prepared under rule 8 of the Military Land Adminictration Rules 1937. He recommended Rs. 40.00 per square yard in item No. 2 of his letter.

The second letter is dated October 27, 1964. It was addressed by the military estateses officer to the deputy director western command. From this letter it appears that some land was required for erecting a higher secondary school building in Mehram Nagar, a place in immedieate neighborhood of Nangal Dewat. The military estate officer suggested that the land measuring 3.69 acres should be leased out/transferred' to the Ministry 'of Eduction, Government of India, for construction of Higher Secondary School building at the rate of Rs. 40.00 per square yard. He said : 'The cost of the land measuring 3.67 acres according to the standard table of rents (rates suppplied recently by the Deputy Commissioner, Delhi) at the rate of Rs. l,93,600.00 per acres comes to Rs. 7,10,512 only. 'This was his proposal. He thereforee sought permission of the deputy director of Western command. He said :-

'YOUR orders are requested as to whether the possession of the said land be handed over to the Education Department or sanction of the Government of India, Ministry of defense 'bs awaited'.

(2) Strong reliance has b;en placed on these letters by the owners. It is contended that these letters are indicative of the market value which the Government itself had fixed for purposes of transfering the land at Rs. 40.00 per square yard. There is no reason, it is said, why the owners should not be awarded the same price for the lands acquired by the Government. This evidence was rejected by the Additional District Judge. He said:-

'IT is not possible to make the recommendations of A-4 and A-5 as a basis for assessing the market value of the land in dispute.' He refused to rely on these two letters for assessing the market value of the land in dispute because he thought that 'the data on which such an opinion is based is not on the record'.

In my opinion these two letters will be a misleading guide to the value of the land. They cannot be classed as a fair test of value. The letters related to inter-governmental transfer or 'allotment of land. They do not even show that the proposed transfer was completed at the rates suggested. Nor are these letters determinative of the market value. Where is the willing buyer and willing seller Where is the market ?the closed corridors of power are not open market places where every one can buy or sell.

The market value has to be based on an examination of ascertained transactions. Evidence has to be given of specfic purchases as land is to bs taken at its market value on a given day under s. 23 of the Act. Fictitious or speculative value cannot be taken into account. Nor can fanciful value be a guide to the land. The test of market value is that it must be a voluntary deal. A voluntary deal is the essence of the market value. It cannot bs said of these two letters that there was a voluntary deal. Nor do we know whether the deal went through on terms proposed. Wasthe bargain struck ?

The market value of property acquired isthe price that can be obtained under fair conditions as between a willing buyer and a willing seller when neither is acting under necessity, complusion or peculiar and special circumstances : See Gujapiraju Vs . Rev. Divl. Officer . The transfer of land mooted in these letters was a transfer from one Government department to anolher.'. It was to be made onthe basis of baok entries.the bargain and Scale was not open to outsiders. .It was not in the open market. There was no haggling of the market betweenthe bargainer and bargainee in this instance, if instance it can bs called at all. In word thrre is no market flavour in it. I cannot thereforee say that this transaction is truly representative of the market value of the land at the material time.

(3) This question was considered by a division of this court (T.V.R Tatachari and R.N. Aggarwal JJ) in R.F.A. 150 of 196S (Pyare Lal Vs Union. of India) decided oil July 19, 1972. There the land in question was village of Nangal Dewat. The notification was also the same. And this very evidence was produced in that case. On this part of the case the division bench held that these two letters had rightly been excluded from evidence by the land acqisition judge. They said:

'....We are inclined to agree with the finding of the District Judge that Ex. A-4 and A-5 (the two letters referred to above) cannot form basis for assessing the market value of the land in dispute. The appellant has not examined the officers who had worked out the rates of land specified in Ex.A -4. There is no material on the record to show the data or the basis on which the rates of land were fixed and recommended for adopted by the Office of the Deputy Commissioner Delhi. The statement with regard to the rates of land contained in Ex. A-4 is general and cannot be adopted in assessing the market value'.

(4) Accepting the transactions of sale dated May 1, 1974, the division bench come to the conclusion that it was a fair guide in fixing the market value of the land in question'.

(5) The letter dated March 21, 1964 is no more than a mere recommendation. Was the recommendation accepted We do not know. The letter dated October 27, 1964 does not go beyond the stage of suggestion or proposal. On this evidence it cannot be said that there was a completed transaction. The market value has to be inferred from ascertained transaction. The suggestion of Rs. 40.00 per square yard made in these two letters bears no relation to the market value. There is no evidence that the prices rules that high. Nor will it be reasonable to suppose that neighbouring properties of similar character changed hands near about the time of notification at Rs. 40.00 per square yard. In my opinion, the judgment of the division bench is consonant to the evidence and is based on sound principles, It. would bs a source of potent error if we allow extraneous considerations, such as these two letters, to enter into our mind for fixing the market value of the site in question. When a specific piece of evidence and a specific purchase, such as is the sale of May 1, 1964, is available, the letters cannot be said to be a trustworthy guide to the value of the land. In my view this evidence was rightly rejected by the Additional District Judge as worthless.

(6) The appellants own lands both in block-I and block-II as classified by the Additional District Judge. The value of Block-1 lands, following the division bench, I fix at Rs. 535U.00 per bigha. The result will be that the appellants will not be entitled to any enhancement on Block-1 lands. For block-ll lands I have to determine for myself the market value because the division bench did not decide anything about block-ll lands. And to this question I now address myself.

(7) It will be recalled that the Collector categorised the lands acquired under three separate heads. The land situated near the abadi and of good quality was placed in block 'A'. The land at a little distance from the village abadi and of good quality was classed as block 'B'. The land characterised by him as 'uneven and somewhat low-lying' the Collector placed in Block 'C'. For block 'C' he offered Rs. 700.00 per bigha which was raised by the Additional District Judge to Rs 2500.00 .

(8) The Additional District Judge has not explained the mode in which he deduced the value of block 'C' lands of the Collector and which he himself had placed in block II. It appears that he adopted the ratio method- quantitative relation between two similar magnitudes determined by the number of times one contains the other integrally. This method is unsatisfactory and jejune. The Collector has not given any reasons why he priced block 'C' lands at Rs. 700.00 per bigha. Nor has the land acquisition judge. All that we know is that block 'C' lands are uneven and low-lying. The difference, according to the Collector, between class 'B' and class 'C' is only Rs. 500.00 per bigha. To award Rs. 2500.00 for this low lying land which can be raised to its proper level by filling loose earth would be incongruous and disproportionate as compared to the lands of blocks 'A' and 'B' . Between the figures of Rs. 5350.00 and Rs. 2500.00 there is a very wide gap and how is to be bridged over? The judgment of the court below leaves the answer to this question very uncertain.

(9) In my opinion the market value of block 'C' lands (Block-11 of the Additional District Judge) ought to be fixed at Rs. 4500.00 per bigha. There is an element of guess work in this process and it cannot be helped. It is quite true, as Lord Hobhouse has said, that :

'IN all valuations, judicial or other, there must be room for interferences and inclinations of opinion which, being more or less conjectural, are difficult to reduce to exact reasoning or to explain to others. Everyone who has gone through the process is aware of this lack of demonstrative proof in his own mind......... ' Secy. of Stale v. Charlesworth Pilling & Co. 26 Bom. 1. In the actual world we are always dealing with approximations, with more or le;s. If blocks 'A' and 'B' owners are to be awarded Rs. 5350.00 per bigha, surely the land in block 'C' can be sold for Rs. 4500.00 per bigha, if the Collector's own calculation is to be any guide. I, thereforee, fix the compensation for block 'C' lands at Rs. 4500.00 per bigha.

(10) As regards the claim for enhancement of compensation for the well there is no evidence. The Collector awarded Rs. 2000.00 as the price of the well. The Additional District Judge upheld this figure. In Pyare Lal's case the division bench raised the compensation for the well from Rs. 2000.00 to Rs. 5003.00 . I too would have done the same if sufficient proof had been forthcoming. There will be no enhancement, thereforee) on the compensation for well.

(11) For these reasons the appeal succeeds in part. For their lands in block I of the Additional District Judge the appellants are not entitled to any enhancement and their claim is dismissed with no order as to costs. For block Ii lands (Block-'C' of the Collector) the appellants are allowed enhancement at the rate of Rs. 2.00 per square yard together with 15 per cent solarium and 6 per cent interest per annum on the enhanced compensation from the date of dispossession till the date of payment. The appellants will also be entitled to proportionate costs on their claim for block Ii lands


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