Mitra and Caspersz, JJ.
1. By three different declarations under Section 6 of the Land Acquisition Act (I of 1894), dated respectively, the 18th June 1903, and 21st July 1903 and the 29th November 1903, the Local Government notified its intention to acquire three adjoining pieces of land in Ichapur, in the 24-Pergannahs, for the extension of the gunpowder factory, for the construction of a siding into the small arms factory and rolling mills, and for extension of the rolling mills. The proprietary right in the lands was Vested in the same persons, though the tenants were different. Some of the claimants, however, asserted rights adverse to the proprietors. For the purposes of the ascertainment of compensation the Collector under the Act of 1894 subdivided the lands into a larger number of plots, and both he and the learned Special Judge, dealing with the references made to him under Section 18 of the Act, have disposed of the claims to compensation under different awards. The result has been that we have before us, at the instance of the present representative of the same proprietors, a large number of appeals. There is not much to differentiate the cases from one another, but unnecessary costs had to he incurred on account of this multitude of oases and appeals. Other difficulties have also arisen, and the learned Counsel for the appellant had a just ground of complaint against the splitting up of lands for the ascertainment of compensation. The matter, however, is now past remedy, and a consolidation of claims would, at the present stage of the proceedings, be useless. The claimant had to pay, collectively, a heavier amount for court-fees on the different memoranda of appeals, and the costs in other respects were also heavier. We think it very desirable that the Local Government should evdeavour to avoid issuing different declarations for the acquisition of portions of the same tract of land when, as in the present case, the declarations follow each other in rapid succession. The Collector and the Judge should also try to consolidate claims to compensation so far as possible. The encouragement of piecemeal acquisition results in loss to all the parties concerned, not excluding the Government itself, and we may mention that in two sets of cases, which have recently come to us from Chittagong, the division of the lands under acquisition for the assessment of compensation has led to an extraordinary increase in the amount of court-fees payable on the memoranda of appeals.
2. The plots of land covered by these appeals lie on the left bank of the river Hooghly to the north of the gunpowder factory in Nawabgunge. They consist of, partly, land between the high and the low water lines of the river in the beginning of the rainy season, partly, land with the river frontage on one side and a road frontage on two other sides, and, partly, land which has the Eckford road on the north and the E.B.S. Railway lines and Ichapur railway station on the east. The land was homestead, garden and tank, but a small part appears to have been used for agricultural purposes. The valuation of homestead lands is generally higher than that of agricultural lands, and it is well known that gardens and tanks are adjuncts of lands occupied as homestead in this country. The different kinds of land must be differently valued, and the valuations must also vary according to advantages or disadvantages as regards the river, the proximity of roads and railway communications.
3. Both the Collector and the learned Special Judge have allowed, generally speaking, compensation for solid land at the rate of Rs. 250, for tank land at half that rate, i.e., at Rs. 125 and for paths at Rs. 68-8 per bigha, but land covered by the latest declaration has been valued at Rs. 350 with proportionate reductions for the tank lands and pathways. The Collector, in his references, gave few or no reasons for his estimates of value. The appellant claimed compensation at the all-round rate of Rs. 1,000 per bigha, but his counsel in this Court stated, having regard to the evidence on the record, that he would be satisfied with Rs. 750. We may say, at once, that the rates mentioned in the awards under appeal are, in our opinion, unduly low, but, at the same time, it is impossible for us to accept the all-round valuation and its basis as put before us for the appellant. The basis of the appellant's valuation consists of three sales, on the other side of the river Hooghly, of land sold for mill purposes. On the 7th October 1898, the Dunbar Mills Company purchased about 56 bighas of land, with maurusi mukarrari right only, for Rs. 50,000 and, on the 17th October 1898, they purchased another 41 bighas for Rs. 50,000. The first sale yields a rate per bigha of over Rs. 900, and the second of over Rs. 1,000. On the 3rd November 1903 the Dalhousie Jute Company, purchased 75 bighas for Rs. 75,000. There were buildings on the land, and after deduction of their value, the rate would be about Rs. 750 per bigha. The land covered by the last sale is very nearly opposite to the land under acquisition, i.e., on the opposite bank of the river in a village called Chapdani. The contention, therefore, has been strongly pressed before us that the land covered by the appeal should be valued at the rate of at least Rs. 750. The argument of Mr. Arthur Caspersz for the appellant may be summed up thus. The three parcels of land covered by the three declarations, if taken together, would cover an area more than sufficient for a jute mill like the mills on the west bank of the river. On one side of the acquired area is a tidal navigable river, and on the other side there is the E.B.S. Railway with the Ichapur station close by, so that the means of bringing in and sending out goods may be considered excellent. The locality is within the commercial and manufacturing suburban area of the second greatest city in the British Empire, such commercial and manufacturing area extending further up the river on both sides. There was thus every probability, and not a mere possibility, of the lands acquired being purchased for mill purposes, as the demand for jute and its manufactured products is fast increasing. Any Company started for the purpose would gladly pay at Rs. 750 per bigha all round. Collector, therefore, should have valued the land at the rate of Rs. 750 per bigha. Such is the argument advanced before us, and we proceed to deal with it.
4. The profit which might arise from the most advantageous disposition of land is, undoubtedly, one test for determining its market price. This principle of valuation was recognised in Premchand Burral v. Collector of Calcutta (1876) I.L.R. 2 Calc. 103 and in a recent unreported case, The Hooghly Mills Co. v. The Secretary of State (1903) Unreported., decided by Harington and Brett JJ., on the 18th June 1903. In the case of Secretary of Stats for Foreign Affair v. Charlesuorth, Pilling & Co. (1901) L.R. 28 I.A. 121 the Privy Council laid down the rule that a claimant is entitled to the market value of his land, including such speculative advance therein as had already taken place in consequence of improvements in the locality, but excluding any future speculative advance for a like cause. The probable use of land in the most advantageous way, in accordance with, or following, the use already made of neighbouring lands, leads to speculative advance in prices, and regard should be had to such advance. The utility of land is certainly an element for consideration in estimating its value, that is the utility which may be calculated by a prudent business man. This principle of valuation was accepted as sound in Rajendra Nath Banerjee v. The Secretary of State for India (1904) I.L.R. 32 Calc. 343.
5. In any person, or a Company could, and did pay a certain price for a block of neighbouring land similarly situated and possessing similar advantages, with a view to some profitable disposition thereof, there is no reason why another block of land, the subject of acquisition under Act I of 1894, should not be similarly valued. The probability of a person or Company purchasing the land for a similar purpose is an element for consideration, if the probability is not so remote that it ought to be held to be merely speculative, so that, other things being equal, of two blocks of land, the block under acquisition should be taken to be of equal market value with the other block. This general principle cannot be denied.
6. The appellant, however, has failed to adduce evidence of any sales in the neighbourhood on this side of the river, though it is admitted that such evidence could have been adduced. There are a large number of factories at no great distances. The riparian area for some miles below Chandernagore, an area which includes a trade centre like Bhadreswar, has for a long time been considered to be more valuable than the corresponding area on the east bank of the river. The most suitable comparison would be with sales on this side of the Hooghly. But, apart from the meagreness of evidence, the areas under acquisition do not appear to us to have been, at the dates of the declarations, adapted for jute mills or mills of a similar character. The existence of the gunpowder factory on the south of the acquired land was a fatal deterrent. The Government would not have permitted the adjoining lands to be used for mill purposes, and the danger of so using them is obvious both as regards the gunpowder factory and the mills. John Nicoll, witness No. 6 for the appellant, states that the gunpowder factory had been converted into a rifle factory within two years of his deposition, that is to say, about the time of the declarations. There is no precise evidence as to the date of such conversion, but it is quite clear that, at the dates of the declarations in 1903, the land covered by the present appeals was generally considered to be unfit for use for a factory like those set up on the other side of the river and further north on this side of the river. Nicoll further says that he never tried to get this land, as he knew it was practically impossible to use it for a mill. We must, therefore, discard as irrelevant the instances of sales to the Dunbar and the Dalhousie Mills Companies. They may, however, be used to show that the general demand for land in the neighbourhood has increased owing to the extension of mills. In fact, a general rise in land values cannot be denied.
7. It seems to us that the market value of the acquired lands must be ascertained from recent instances of sales of Ichapur itself and the adjoining villages such as Nawabgunge, Garulia, and from the average rentals of these and similar lands in the neighbourhood.
8. But before entering into a consideration of the evidence on these points, we think it desirable to say something on the question of the burden of proof discussed before us. In Appeal from Original decree No. 264 of 1905, in which we delivered judgment on the 12th April, we have held that though the claimant must, on a reference under Section 18 of the Act, begin, and thus start a case showing that the Collector's award should not be accepted, the onus of proof varies according to the probative value of the enquiry made by the Collector under Section 11 of the Act. Section 14 gives the Collector powers to summon witnesses, and to compel the production of documents, and to make an enquiry in the same way as a Civil Court would do in such a case. He is, also, bound, when a reference is made to the Judge. to state the grounds on which. his award of compensation was based. If, however, he makes no enquiry or gives no grounds for his valuation, the burden of proof on the claimant is nominal. The Special Judge must decide according to the weight of evidence, irrespective of the question of onus probandi and without throwing on the claimant an undue share of it.
9. In these appeals the Collector gave very little assistance to the learned Judge in the Court below when he submitted his statements under Section 19. The learned Judge ought to have decided the cases, and we must decide these appeals, having regard to the weight of the evidence of the market value and rentals on the record, irrespective of the question of burden of proof.
10. Then again in calculating the market value of land, as deducible from instances of sales, the freehold interests, including the interests of tenants and under-tenants, should be taken into consideration. If any sale relates to a permanent subordinate interest, the capitalised value of the landlord's interest should be added. If the calculation is to be made on the basis of income derived or derivable from the land sold, the profit realized by the person in actual occupation should be the basis of calculation. The rent realized by a tenure-holder of the lowest grade may also, occasionally, be the determining factor. The mere fact that the superior landlord is the person who asked for a reference under Section 18 is not sufficient to entitle the Judge to determine the market value of land on the basis of the profits of the superior landlord, unless the nature of the subordinate interests be admitted and their value be capable of determination irrespective of the landlord's interest. Section 21 of the Act authorizes the Judge to confine his enquiry into valuation to the interests of the persons affected by the reference under Section 18, but the section must mean the admitted interests. If there be any dispute as to the relative value of such interests, the total amount of compensation paid may be the subject of a case for apportionment, and the Judge should determine the total amount payable for the land leaving the question of apportionment to be decided in a separate proceeding to be asked for by any of the parties. The determination of the value of an individual interest as contemplated in Section 21, exclusive of the interests of other claimants to compensation, is possible only in a case where such interest is incapable of variation in a proceeding for apportionment.
11. In the appeal before us, the appellant, as one of the claimants, denied the right of the other claimants to any share of the compensation-money. He denied the existence of rent-free rights or permanent subordinate interests. He claimed the entire amount payable, and so his claim, irrespective of the claims of the other claimants and including all possible interests, should be adjudicated upon. It is no answer, in an enquiry into his claim to compensation, that there are tenants on the land whose interests might be separately valued. We have been informed that, in the apportionment cases that followed the awards made by the learned Judge in the lower Court, the interests claimed by the other claimants have been negatives, and an affidavit has been filed in support of the allegation. But, whether the apportionment cases have been decided in the manner indicated in the affidavit or not, the Court must, having regard to the pleadings in the cases, determine the entire amount payable by the Collector in each case, and not merely the amount payable as if the other interests claimed were admitted.
12. Now, the first instance of sale to which our attention has been drawn relates to 10 cottas of land in Garulia. This sale took place on the 13th November 1902, and the real purchasers were the Shamnagar Jute Mills Co. The interest sold was a mukarrari tenancy bearing a rental Re. 1-3. This land, however, is not close to the areas under acquisition, and it was purchased by the Company for a special purpose. Such a sale, therefore, is not an apt instance, but as the mukarrari interest was sold at the rate of Rs. 600 a bigha, admittedly a rather high rate, this sale, along with the instances of sales for factory purposes on the other side of the river, and the statements male by the witnesses Nicoll and Cohen, show that the demand for land on both sides of the river is great and that the average price of land has substantially increased of recent years. The average price spokea of is Rs. 600 a bigha, and we have every reason to believe that Rs. 600 per bigha is now considered to be the fair average market value for sites on the river side, though small pieces of land suitable for building purposes of Hindus immediately on the bank of the sacred river with a good road from a railway station have special market values. In sales of land for ordinary homestead purposes, the price may not be as high as what would be paid for factory purposes, but the general demand for land and the consequent reflex action on the prices of all classes of land, cannot be gainsaid, and the factor should be taken into account in calculating the market value of the lands under acquisition.
13. Sales or leases of small pieces of land in or near the Nawab gunge bazar to the south of the gunpowder foundry have not much evidentiary value in this case. These parcels of land are not only distant, but it is well known that lands in or close to a bazar have special market values, so that a comparison of such lands with the lands in controversy will not lead to any useful result. Siddheswar Ghose and Mohendra Nath Saha might have paid prices which on calculation would be much more than Rs. 600 per bigha, but there are special reasons which might have led them to pay more than the ordinary market rates. A good many such instances have been brought forward, but they cannot be regarded as accurate tests.
14. The next piece of evidence to which our attention has been called relates to the negotiations for sale of about 5 bighas of garden land south of the Eckford Road and included within one of the plots under acquisition. We have no doubt of the genuineness of the negotiations and the truth of the evidence supporting them. The purchaser offered, in July 1902, Rs. 3,000 for 5 bighas of land with plants and new grafts of fruit trees. The vendor wanted more and refused to accept the offer, so the negotiations broke off. The vendor's right was subordinate to the proprietor's and for such right Rs. 600 per bigha was offered but not accepted. This land was not by the river side. This is a cogent piece of evidence as to rate. Deducting the value of the grafts and other plants on the land, and adding the landlord's interest capitalized, we cannot come to any other conclusion than that the fair market value per bigha is Rs. 600 for lands advantageously situated in the locality; and this conclusion we are disposed to arrive at in other ways also.
15. The instances of sales relied on by the learned vakil for the respondent in the lower Court were not many. Some of them took place more than thirty years ago. Before us, however, the sale relied on is one of the year 1896 by Amarnath Sadkhan to Aghore Nath Sadkhan, and also the lease that followed, but it is clear from the evidence that the transfer was more in the nature of a gift than a sale, as admittedly a nominal value was fixed. We do not, also, know what, if any, salami was paid for the fresh lease that followed the transaction.
16. Considerable reliance, however, has been placed by the learned vakil for the respondent on a sale in the year 1900 of a small piece of land in Majipara that is in Ichapur itself. The transaction evidenced by the deed (Ex. F.) was a sale by a Hindu female of 15 cottahs of maurusi mukarrari land with huts and trees for Rs. 55 only. The price was extraordinarily low Doubts and uncertainties generally attend titles conveyed by Hindu widows of the estate of their deceased husbands, and we cannot take this instance as affording a fair criterion for determining the market value of land in Ichapur.
17. We shall now examine the evidence as to rates of rents in the locality. The rates paid to the appellant cannot be a basis for calculation. We have to take into consideration the rack rental in the locality, that is to say, the highest rental payable for his land by a tenant in actual occupation should, in our opinion, form the true basis of calculation. The lands under acquisition being chiefly homestead and tanks, statutory rights, such as the rights of agricultural tenants generally are, do not debar the proprietors from getting the full benefit of their unearned increment. The actual assets of the land should be considered, and not merely the rents paid to the proprietors or any intermediate holders.
18. Leaving out of consideration the rental paid for chur lands occupied for brick-making, of which two instances have been given, there is evidence to show that a parcel of land on the river side with trees and a tank was let out at Rs. 4 per bigha per month. This gives a capitalised value of Rs. 960 per bigha. But the tenant might have paid rather more than others would have done, as the land adjoined chur land occupied by him for brickmaking.
19. Then, the rates of rent generally paid in the adjoining villages give capitalized values of over Rs. 600, but the plot of land on the river hank has special advantages which deserve higher assessment.
20. The conclusion to which we cannot hut arrive at is that land on the river side and up to the Eckford Road should he valued at Rs. 800 per bigha (plots 63, 64 and 65 in map Ex. G; plot 1 in the map in Appeal No. 192 of 1906). Other plots of land on or near the Eckford Road, and to the immediate east of the road, to the east of these three plots, and west and north of the blue lines in pencil drawn by us on map Ex. G., should be valued at Rs. 600 per bigha, but following the usual rule we allow half that rate for tank lands within those plots, and one-fourth for lands used as roads and pathways. The plots at a distance from the river, i.e., lands to the south and east of the blue line, also lands covered by map Nos. 10 and 11 should be assessed with a deduction of one-third, i.e., at Rs. 400, Rs. 200 and Rs. 100 respectively. Lands south of the Railway Station at Ichapur, i.e., the southern plots depicted in map Ex. G. 2 have similar advantages to the lands on the river side for homestead purposes, except as regards situation, and should be valued at Rs. 400, but the lands which were used as arable had the immediate prospect of being converted into urban plots, and they would have fetched lower prices than homestead lands, and we value them (plots 7 and 8 in Ex. G. 3) at Rs. 300 per bigha, The strip between high and low water lines of the river (plot No. 66 in map Ex. G. 1) will be valued at one-fourth of the rate of Rs. 600, i.e., Rs. 150, as it has not been shown that it has at present any letting value, but it may be used for brick-making or other similar purposes in future.
21. We, accordingly, direct that the awards made by the lower Court be modified, and that decrees be drawn up in this Court after calculation of the areas in each case assessed at the values which we have indicated.
22. It will be necessary in drawing up the decrees to make calculations with the help of a professional Engineer, and the appellant must, in the first instance, pay his fees.
23. Costs incurred by the parties in the lower Court as well as in this Court, including costs that may be incurred in preparing the decrees, will be paid by the parties in proportion to their respective loss and gain.
24. Statutory allowance and interest on the amounts in excess, if any, of the amounts awarded by the lower Court should be calculated according to the provisions in the Act with reference to time and rate.