Full Judgment Text
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PETITIONER:
STATE OF UTTAR PRADESH ETC.
Vs.
RESPONDENT:
SMT. RAM KUMARI DEVI ETC.
DATE OF JUDGMENT: 15/02/1996
BENCH:
RAMASWAMY, K.
BENCH:
RAMASWAMY, K.
G.B. PATTANAIK (J)
CITATION:
JT 1996 (3) 380 1996 SCALE (2)627
ACT:
HEADNOTE:
JUDGMENT:
WITH
CIVIL APPEAL NOS. 3815-16 OF 1996
--------------------------------
(Arising out of SLP (C) Nos.12146/95 and 16059/95)
AND
CIVIL APPEAL NO. 3817 OF 1996
-----------------------------
[Arising out of SLP (C) No.11256 of 1995]
O R D E R
Leave granted. We have heard learned counsel on both
sides.
Notification under Section 4(1) of the Land Acquisition
Act 1 of 1894 (for short, the ’Act’) was published on
September 14, 1985 acquiring 13.75 acres for setting up the
Government Degree College at Lalitpur, State of U.P. The
Land Acquisition Officer in his award dated September 1,
1988 made under Section 11 of the Act determined the
compensation at the rate of Rs. 11,887.78 per acre. On
reference under section 18 of the Act, the District Judge by
his award and decree dated April 21, 1990 determined the
compensation at the rate of Rs.5/- per sq. ft. On appeal by
the appellants, the High Court reduced the compensation to
Rs.3.30 per sq. ft. by judgment and decree dated November
16, 1994 in First Appeal No.603/93 etc. Thus these appeals
by special leave.
It is contended by Shri A.B. Rohtagi, learned senior
counsel for the appellants that the whole approach adopted
by the High Court and the reference Court is clearly illegal
and erroneous. When 13.75 acres of land was acquired for
public purpose, would a reasonable prudent purchaser offer
to purchase the land at the square foot basis is the
question posed and rightly posed by the learned counsel for
the appellant. The reference Court relied on three sale
deeds Ex.A2, A3 and A1. Ex.A2 relates to an extent of
60’x20’ of land sold by the claimant himself on October 18,
1984 for a sum of Rs.6,000/- which worked out at the rate of
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Rs.5/- per sq. ft. He also sold an extent of land of 40’x40’
ft. for a sum of Rs.8,000/- under Ex.A3 on January 19, 1983.
1600 sq. ft. was sold for a sum of Rs.8,000/- on January 18,
1983 under Ex.A1. The reference Court relied upon these sale
deeds and also the rates prescribed by the local
administration for the purpose of stamp duty at Rs.8/- per
sq. ft. for the road margins and Rs.5/- per sq. ft. for the
interior land. Relying thereon, the reference Court
determined the compensation at Rs.5/- per sq. ft. The High
court while accepting the same, deducted 1/3rd towards
developmental charges and determined the compensation at
Rs.3.30 per sq. ft.
It is seen that small pieces of land of an extent of
60’x20’, 40’x40’ and 1600 sq. ft. were sold by the
claimants, obviously on coming to know of the proposed
acquisition. It is common knowledge that acquisition
proposal would be made at an earlier point of time and
finalization of acquisition would take long time. In the
process, on becoming aware of the acquisition, obviously,
these sale deeds have been brought into existence to
inflates the market value. It is laid down by this Court
which is well settled principle that it is the duty of the
court to assess reasonable compensation. Burden is on the
owner to prove the prevailing market value. On adduction of
evidence by the parties, the acid test which the Court has
to adopt is that the court has to sit in the armchair of a
prudent purchaser, eschew feats of imagination and consider
whether a reasonable prudent purchaser in the open market
would offer the same price which the Court is intending to
fix the market value in respect of the acquired land. Since
it is a compulsory acquisition, it is but the solemn duty of
the Court to assess reasonable compensation so as to allow
the same to the owner of the land whose property has been
acquired by compulsory acquisition and also to avoid
needless burden on public exchequer. No feats of imagination
would require to bog the mind that when 13.75 acres of land
was offered for sale in an open market, no prudent man would
have credulity to purchase that land on sq. ft. basis. The
High Court as well as the District Judge have committed a
grave error in not applying the above acid test while
considering the case. They merely proceeded by accepting the
sale deeds which were obviously brought into existence to
inflate the market value and determined the compensation on
the price settled by them. Thus, we hold that both the
Courts have applied a wrong principle of law in determining
the compensation.
The question then is: what would be the reasonable
market value? In the synopsis of the case, the appellants
themselves have indicated and the counsel has reiterated
that they are agreeable to pay at the rate of Rs.30,000/-
per acre. In view of their admission, the market value is
determined at Rs.30,000/- per acre.
The claimants are entitled to statutory solatium under
Section 23 [2] and interest under Section 28 till date of
deposit of compensation amount and also additional amount
under section 23(1-A) on enhanced compensation of the
compensation.
The appeals of the State are accordingly allowed.
No costs.
CA NO. 3817 OF 1996
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[@ SLP (C) No.11256 of 1995]
This appeal being a cross-appeal by the claimant for
further enhancement of compensation, is dismissed. No costs.
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