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Ujjal Singh Vs. Union of India and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtDelhi High Court
Decided On
Case NumberRegular First Appeal Nos. 380, 397 and 398 of 1968 and 80 of 1969
Judge
Reported in16(1979)DLT231
ActsLand Acquisition Act, 1894 - Sections 18
AppellantUjjal Singh
RespondentUnion of India and ors.
Advocates: R.S. Narula,; Daya Kishan,; Ajit Singh and;
Cases Referred(See D.L.F. United Ltd. v. Union of India
Excerpt:
land acquisition act (1894) - sections 18 & 23--market value of the land--determination of--sales of small plots of land are not to be entirely disregarded when evidence of large plots is not available--sales conducted by rehabilitation department are not dubious transaction being conducted by the government by public auction and by issuance of sale certificate by the ministry.; in the instant case, government acquired the land of ujjal singh situated in trans-jumuna village of karkarduma for a public purpose vide notification under section 4 of the land acquisition act, 1894 issued on november 13, 1959. after usual statutory proceedings the collector made two awards and awarded compensation at the rate of rs. 400/- per bigha. displaced with the award the owner asked for a reference..........to be awarded for land acquired under the act the court shall firstly take into consideration 'the marketvalue of the land at the date of the publication of the notification under s. 4 sub-section (1)'. section 23 is couched in language which asserts that compensation is not charity but right. it is a right founded on the concept of market value. the measure of compensaltion is the market value. market value means the price that a willing purchaser would pay to a willing seller for the property having due regard to its existing conditions with all its existing advantages and its potential possibilities when laid out in the most advantageous manner excluding any advantages due to the carrying out of the scheme for which the property is compulsorily acquired : raghubaos narain v. govt of.....
Judgment:

Avadh Behari Rohatgi, J.

(1) THESE; are four appeals from a common judgment of the Additional District Judge dated June 15, 1968. Two appeals (R-F.As. 397 and 398 of 1968) are by the owner. The other two (R.F.A. 380 of 1968 and R.F.A. 80 of 1969) are cross-appeals by the taker of the land, the Union of India. This judgment will govern them all.

(2) The appellant Ujjal Singh was the owner of certain lands situated in a trans-J'amuna village of Karkarduma. The Government acquired his land for a public purpose. Notification under s. 4 of the Land Acquisition Act, 1894 (the Act) was issued on November 13, 1959. I Declaration under s. 6 of the Act was made on October 3, 1962. After usual statutory proceedings the collector made two awafrds. (Award No. 144 and 1467 dated February 7, 1963). (Other awards pursu- ant to the notification under s. 4 dated November 13, 1959 are 1804, 2210, 54/69-70, 54-A/70-71, 21/70-71). By Award No. 144 the Government acquired 33 bighas Ii biswas. Under Award No. 1467 the land acquired was 45 bighas 4 biswas.

(3) The collector awarded compensation at the rate of Rs. 400 per bigha. Displeased with the award the owner asked for a reference under s. 18 of the Act. On reference the Additional District Judge enhanced the compensation to Rs. 2,000 per bigha- From his decision the owner appeals to this court for further enhancement. He claims a further increase of Rs. 4,500 per bigha' over what he has already been awarded by the land acquisition court. The Union of India, on the other hand, asks for reduction in compensation.

(4) The owner h,ad two kinds of land. Of 26 bighas and 13 bids was he claimed to be the exclusive owner- Of 10 bighas 2 bids was he was a lessee. As regards the land held under the lease the decision of the land acquisition judge was that the lessee wilt get 12 annas in a rupee. There is no appeal by the Lesser with regard to the land held by the claimant under lease.

(5) Karkarduma is the original name of this village. It adjoins Jhilmil Teharpur. Since 1934 the village of Karkarduma is within the bounds of Shahdara Municipality. In 1935 a lay out of this village was sanctioned by the Shahdara Municipality. Later it came to be known as Biswa's Nagar.

(6) It is not disputed that the owner was using the land at the time of expropriation for purposes of agriculture. He had set up a farm there. He had the facility of electricity, telephone and tubewell. But there is no evidence that there was any construction of houses or any buildings either on the owner's land or in the vicinity. It is also admitted that the land was undeveloped and was being used for agriculture. There were no roads. What was known as bids was Nagar was a scheme which existed only on paper. There was no demarcation of plots. No building activity was in sight.

(7) The Additional District Judge besides examining the witnesses also visited the spot. He made his inspection note. In his note dated June 5, 1968 he said :

'There is no such thing as bids was Nagar on the spot. There is neither any demarcation of plots nor any buildings existing thereon. The entire land which is stated to be bids was Nagar is lying undeveloped. thereforee, that residential colony is only on papers.... Further neither any Kachha nor any puce road is visible in the estate of Karkarduma, and there is no approach road kuchha or puce to the land in dispute from the place I went i.e. on the border of Jhilmil and Karkarduma estates. However, I was shown electricity and telephone lines going on the land of Karkarduma:'.

(8) That this is a correct description of the land acquired has not been contested. The Additional District Judge came to the conclusion that the land in dispute had potential value as a building site. He said this :

'Hence it can be said that the land in dispute had potential value as building site. thereforee, it is to be evaluated as such. Even as an agricultural land it must have quite good value as the facility of electricity and telephone were available and the area was within the Municipal limits of Shahdara Municipality on the date of notification under S. 4 of the Act.'

(9) A mass of evidence oral and documentary was produced before the land acquisition judge. He sat to fix the market value of the land. The upshot of his investigation was that the market price of the land was Rs. 2000 per bigha at the material time. For this conclusion of his he advanced three reasons.

(10) In the first place he relied on a sale of May 8, 1948 (A/67). It was a sale of 13 bighas 10 bids was for Rs. 20,000. The price works out to Rs. 1.50 per sq. yard. 'This was the price prevailing in 1948. To this he added 33 per cent because of the rising prices. He formed the view that on the given day in 1959 the price of the land in dispute was Rs. 2000 per bigha.

(11) The second reason was that the price prevailing in village Mandoli, a nearby village, at the relevant time was in his opinion Rs. 2500 per bigha. A judgment of Shri D. R. Dhamija, Additional District Judge dated November 18, 1964 was cited as an instance before him. There Mr. Dhamija had valued the land in village Mandoli at Rs. 4000 per bigha. On this valuation the learned judge different from Mr. Dhamija. In his opinion the market price on the evidence produced before Shri Dhamiji could not be assessed higher than Rs. 2500 per bigha. He, thereforee, thought that the market value of the land in Karkarduma should be fixed at Rs. 2000 per bigha.

(12) The third reason given by the learned judge is based on a letter dated May Ii, 1955 written by the Improvement Trust to the Director of Health Services, Delhi. Land for the purpose of setting up a mental hospital in Jhilmil Tahirpur was agreed to be transferred. In this letter the price of the land was quoted as Rs. 2 2 annas 6 pies per square yard. On this basis the learned fudge concluded that the market value of the land in Karkarduma in the year 1959 was Rs. 2000 per bigha.

(13) A large number of sale transactions both private and Government sales were also produced in evidence. The learned judge refused to look at them. He rejected them on the ground that those sales were of very small pieces of land and the value of small pieces of lard cannot be a good basis for finding out the market value of the laloo area acquired'. On these sales his conclusion was' that 'prices fetched vide these sale deeds are not relevant for finding out the market value of the land in question.'

(14) With this approach of the learned judge I cannot agree. In my opinion he admitted into his mind those considerations which the Act does not prescribed. Section 23 of the Act provides that in determining the amount of compensation to be awarded for land acquired under the Act the court shall firstly take into consideration 'the marketvalue of the land at the date of the publication of the notification under S. 4 sub-section (1)'. Section 23 is couched in language which asserts that compensation is not charity but right. It is a right founded on the concept of market value. The measure of compensaltion is the market value. Market value means the price that a willing purchaser would pay to a willing seller for the property having due regard to its existing conditions with all its existing advantages and its potential possibilities when laid out in the most advantageous manner excluding any advantages due to the carrying out of the scheme for which the property is compulsorily acquired : Raghubaos Narain v. Govt of U. P. Air 1967 S.C. 465.

(15) I will now deal with the learned judge's reasons. Firstly the price of land prevailing in 1948 is no criterion for fixing the market price in the year 1959. It is true that the transactive of May 8, 1948 shows that in 1948 the price of the land in this locality was Rs. 1,500 per bigha. But to add 33 per cent to that price is not a correct method to find the market price at the relevant date. 'Award of fair compensation is not an algebric problem which ca(n be solved by an abstract formula.' (Nowroji v. The Govt. of Bombay, I.L.R. 49 Bom 700.

(16) As regards the second reason advanced by the learned judge it appears to me that he should have either taken the judgment of Mr. D. R. Dhamija produced before him as an objective assessment of the market value prevailing in village Mandoli or if he did not agree with his reasonmg he should have discarded it. But to reach a different conclusion on the evidence produced before Mr. Dhamija was not open to him. He was not sitting in appeal over that judgment. Nor did he have the advantage of the court of first instance. He seems to have overlooked the fact that in all valuations, judicial or other, there is an element of guess work which in the very nature of things cannot be helped. (Prithvi Raj v. State of M. P., : [1977]2SCR633 . And guess work we know is more or less conjectural and essentially subjective. Everyone who has gone through the process is aware of this lack of demonstrative proof in his own mind and knows that each one of us has his own set of conjectures, of more or less weight, according to his experience and personal sagacity.

(17) Nor do I find myself in agreement with the learned judge in the third reason given by him. The price quoted in the correspondence which passed in the corridors of power is not truly representative of the market price. The official corridors are not open market places where everybody can buy or sell. An open market implies that land is offered under conditions enabling every person desirous of purchasing to come in and make an offer. (Inland Revenue Commissioners v. Clay and Buchanan (1914). 3 K. B. 466.

(18) Market price has to be ascertained from the actual transactions of sale. This is the time honoured test to determine the market Value at a given moment of time. The owner produced a large number of transactions of sale of near about the time of S. 4 notification of this very village. He gave 17 instances of plots of land which were sold by the Ministry of Rehabilitation at public auctions in bids was Nagar of Karkarduma. 7 private sales were tendered in evidence of the land of this very locality.

(19) It is in evidence of the managing officer of Regional Settlement Commissioner's Office that 700 plots in the revenue estate of Karkarduma were sold by the Ministry of Rehabilitation in 1958-59. At the time these auction sales were made the plots were undeveloped and there were no roads. Nor did not Rehabilitation Department under. take to develop these plats. The prices at which these plots were sold at the public auction vary from Rs. 9.25 per sq. yard to Rs. 14 per sqyard. All these plots were of 200 sq. yards each. The private sales I show that ihe price was ranging from Rs. 6.50 to Rs 0 per sq. yard. An abstract of all these sales was given by the land acquisition judge in his judgment and it is agreed that this is substantially a correct summary of the transactions of sales that were tendered in evidence before him.

(20) On 21st June, 1959, there is sale of a plot of 200 sq. yards at Rs. 14 per sq. yard. This is the highest price in the rehabilitation sales. In the private sales one transaction shows that 200 sq. yards of land was sold on November 24, 1959 at Rs. 9 per sq. yard. It is from this material that the court has to form, as best as it can, an B estimate of the prevailing price of land in the locality at the critical period. The valuer's task is to enquire at what prices properties of similar character had changed hands in or close to the land in question near about the time of the notification under s. 4 of the Act. That will be his guide to the value of the land. For this we have specific pieces of evidence in hand.

(21) From the evidence it appears that there were willing and anxious purchasers for small building plots in the colony. It is true that the price paid for a small plot cannot be taken as a fair test of value for large tracts of land. To accept these sales of small building sites as a trustworthy guide to one's conclusion is to give misleading importance to them. But at the same time these sales cannot be discarded. They cannot be thrown out of consideration. On a comprehensiv'e survey of the scene these sales cannot be shut out from view. Between the evidence referred to by the judge in the summary of sales and his valuation at Rs. 2000 per bigha, there is very wide gap and how is it to be bridged over The judgment of the court below gives no answer to this question.

(22) To accept as conclusive the evidence of small sites in fixing the value of large areas of land is to follow a misleading guide. But the sales of small plots are not to be entirely disregarded because at any rate they afford some help in the task of fixing the proper price. The reason is that rehabilitation sales are not dubious transactions. These sales were conducted by the Government. The plots were sold by 'public auction'. Sale certificates were issued by the Ministry. They are the best evidence of the value of small plots in this locality on the given day.

(23) On the value of the rehabilitaition sales counsel for the parties agreed before the land acquisition judge that they were to be valued at the rate of 12 annas in a rupee. thereforee from the price paid at the auction 25 per cent has to be reduced. That, according to the agreement of parties, will represent the market price of the plot. This J too has to be kept in mind while determining the market value in this case.

(24) What is the evidentiary value of sales of small building sites is a question that cannot answered in the abstract. To ignore small sales altogether, as did the land acquisition judge in this case, is to transgress the principle of equivalence which is at the root of statutory compensation, which lays it down that the owner shall be paid neither less nor more than his loss. The enunciation of this principle the most fundamental of all is easy enough. Its justice is self-evident but its application to varying facts is apt to be difficult. It is not easy to spell out of it a general criterion which will afford a practical test in all cases. [Horn v. Sunderiand Corp. (1941) 1 All E.R. 430 per Scott L.J.] (5).

(25) When evidence of sale of large plots is not available as in this enquiry, the tribunal vested by law with the duty of assessing compensation due to the owner must form a value idea from the data of small plots. The assumption that value of large plots is not the same as of small plots is largely true. But this assumption has to be kept within bounds. The assumption is not an absolute proposition [See State of Maharashtra v. BapuRao, : AIR1973Bom231 . The Supreme Court in Collector of Lakhimpur v. B. C. Datta, : AIR1971SC2015 deduced the value from comparatively small plots.

(26) In my opinion the owner in this case is entitled to take advantage of the transactions of small sales be produced in evidence. He can rely both on the bulk of evidence and its weight. To deny the exproporiated owner the advantage of the high price ruling in the public auction sales by the Government in a case as this is to do him less than justice. 'The community has no right to enrich itself by deliberately taking the property of its members in such circumstances that it is not playing fair with those members'. [Fitzgerald in 1952 Current Legal Problems p. 55 quoted in Law Commission Report 1957 and Union of India V. Ram, Mehar, : [1973]2SCR720

(27) Counsel for the Government argued that I ought to prefer private sales to public auctions as in the latter payment was allowed against adjustment of compensation claims. This is a fallacious reasoning. After counsel's concession that these auction sales be rated at 12 in a rupee there remains no distinction between private and public sales. The owner is entitled to insist that the auction sales of Rs. Ii, Rs. 11.50, Rs. 13.12 and Rs. 14 per sq. yard must also fall in the valuer's ken. The court can make proper allowance in estimating the market price. Not to concentrate on these sales at all is to award the owner less than just compensation. What is gained on the swings will easily be lost on the roundabouts.

(28) Karkarduma is situated in the immediate neighborhood of the residential colony of Jhilmil Tahirpur. On one side of the G. T. Road is this Jhilmil colony. On the other side across the railway line is the village of Karkarduma. There is the nazul land in between the two. There was undeveloped land in Jhilmil colony. For that I awarded Rs. 8,500 per bigha for land acquired under this very notification. (See D.L.F. United Ltd. v. Union of India, R.F.A. 364 of 1964 decided on 26th March, 1979.) (9) Very near to the village of Karkarduma is the village of Mandoli. Land there was valued at Rs. 4000 per bigha as appears from the judgment of Mr. Dhamija, dated 18th November, 1964. These two judgments Mr. Dhamija's and mine are an attempt at objective assessment of the ruling price in the close vicinity of the land which is the subject of these appeals.

(29) Taking all the circumstances into account I am of opinion that the market price of the land at the material time should be assessed at Rs. 60001- per bigha and I hold likewise.

(30) For these reasons the appellant in R.F.A. 397 and 398 of 1968 is allowed enhancement of Rs. 4000 per bigha for the lands of his exclusive ownership in which he will be entitled to full compensation and Rs. 4000 per bigha for the land held by him on lease in which he will be entitled to 12 annas in a rupee as his share of compensation 4 annas share in a rupee will go to the lessee. The appellant will also get the statutory solarium of 15 per cent and interest of 6 per cent per annum on the enhanced compensation from the date of dispossession till the date of payment and proportionate costs.

(31) As a result of my above decision the appeals of the Union of India (R.F.A. 380 of 1968 and 80 of 1969) fail and are dismissed leaving the parties to bear their own costs.


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