Full Judgment Text
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 7201 OF 2005
C.E.S.C. Limited …..Appellant
Versus
Sandhya Rani Barik and Ors. ….Respondents
(With Civil Appeal Nos. 7202, 7203, 7204, 7205 and 7206/2005)
J U D G M E N T
Dr. ARIJIT PASAYAT, J.
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1. These appeals have been filed by CESC Ltd. questioning
correctness of the judgment rendered by a Division Bench of
the Calcutta High Court disposing of three appeals filed by the
present appellant challenging common judgment and order of
learned Land Acquisition Judge by which he disposed of three
references from the award of the Collector. The acquisition of
these lands took place under the West Bengal Land
(Requisition and Acquisition) Act, 1948 (in short the ‘West
Bengal Act’) and not under the Land Acquisition Act, 1894 (in
short the ‘Act’).
2. Cross appeals have been filed by the claimants seeking
enhancement of rent and higher rate of interest.
3. The number of claimants was quite large and about 20.
They were booked in three sets. The land was acquired under
the West Bengal Act in May 1995. The requisition was made in
1995 and the Notification was issued on 3.5.1995. The total
area was more than 3 bighas. One bigha is 20 cottahs and 1
cottah is 720 sq.ft. The land was part of 10 bigha tract
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situated in 156A, Manicktala Main Road owned previously by
a single common ancestor namely, Kali Pada Barik who had
since died. The Collector made the award some time in the
year 1997 and thereafter the Land Acquisition Judge was
approached on reference by the Bariks i.e the respondents in
the three appeals. The Collector’s award was initially on the
basis of about Rs.50,000/- per cottah as compensation but
the Land Acquisition Judge on the first occasion raised it to
nearly Rupees 5 lakhs per cottah. At that stage the State and
the Bariks were opposite parties. Since the land was acquired
for the purpose of present appellant which was the requiring
authority under the West Bengal Act, acquisition has to be
preceded by a requisition for maintenance of supplies
essential to public life and in this case supply of electricity
was the service involved. A Sub-station i.e. 132 K.V. had
already been built over the acquired land. The Requiring
Authority filed a Writ Petition before the High Court taking the
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stand that the matter was decided in its absence. On 3 May,
2000 order was passed by a Division Bench of the High Court
whereby the matter was remanded to the Land Acquisition
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Judge directing the appellant to be made a party. It also
directed that persons who had already been examined before
the Land Acquisition Judge would be again presented for
cross examination by the appellant subject to their
availability. The matter was considered again. The Land
Acquisition Judge again made assessment and after hearing
the present appellant held that the rate per cottah would be
higher. But in view of the fact that earlier a lower rate had
been fixed, same was maintained.
4. The determination was challenged before the High Court.
5. The appellant referred to the evidence of some of the
witnesses examined by Bariks. One Chandra Nath Barik
admitted that the acquired land was previously being used by
the washerman of the family for washing clothes and drying
those. Evidence was led by the appellant that at the time of
requisition of the land in 1990 the land was low in lying area
and was filled with water hyacinths. Just outside the
boundary of the tract acquired, there was a big pond. The land
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had to be filled up by copious supply of fly ash which was
supplied by the appellant itself from its generation plant at
Titagarh. The thickness of the filling fly ash layer was of the
order of 10 ft. The land development was undertaken by the
appellant by engagement of certain contractors. Their bills
were exhibited and the payment to the order of about Rs.30
lakhs was claimed.
6. Bariks on the other hand took the stand that entire
money was not spent on land development, but a part of that
was for putting up the structures of the appellant as well. The
High Court referred to some factual aspects and took note of
the fact that the appellant’s main grievance was that large
track of land was the subject matter of acquisition and the
rates applied for smaller plots cannot have any relevance.
After referring to certain factual aspects, the High Court
disposed of the appeals in the following manner:
“1. the market price of the land acquired is
determined to be Rs.2.25 lac per cottah and
the referring claimants in all these cases do
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get an award of compensation of Rs.2.25 lac
per cottah.
2. In addition thereto, they are entitled to solatium at
the rate of 30% on the said land value.
3. They shall also be entitled to additional
compensation of 12% per annum on the land value,
but not the solatium, from 3.5.95 to 27.3.97(see:
Sunder’s case (2001) 7 SCC 211) which deals with
ultimate i.e. 5.28 interest on solatium but does not
pronounce that Section 23(1A) will apply on Section
23(2) also).
4. The respondents/referring claimants shall also be
entitled to rent compensation at the rate of 9% per
annum from 16.10.90 to 2.5.95 on the land value
computed at the rate (per cottah) of Rs.2.25 lac less
25%; we clarify that the land value is to be reduced
by 25% and rent compensation shall run thereon
the said period 16.10.90 to 2.5.95.
5. On all the items 1, 2, 3 and 4 the
respondents/referring claimants shall be entitled to
interest at the rate of 9% per annum from 27.3.97
until payment or payment into court; if such
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payment is not made within 17 February, 2004 the
interest shall be thereafter at the rate of 15% per
annum; and
6. Due credit shall be given in regard to the wiping of
liability as regards the above heads, on account of
payments or payments into court already made by
the appellants.”
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7. Stand of learned counsel for the appellant essentially
was that the rate applicable for acquired land cannot be as
high as Rs.5,32,000/- per cottah as was fixed by the
Reference Court. It is submitted that though the High
Court fixed it to Rs.2,25,000/- per cottah, same was also
high. The claimants relied upon sale deeds measuring about
5 cottahs. In the Cross Appeals filed, Bariks have taken the
stand that the appreciation aspect has not been taken note of.
The reductions i.e. 25% for land locking, 15% for road frontage
and 5% for belting are irrational. A large number of claimants
i.e. 22 are involved and it is their undivided shares which had
to be taken note of. It was pointed out that each person on
partition does not get more than 5 cottah. The purpose of
acquisition was construction of sub-station which required
large area. The acquired land was homestead urbanized
industrial area.
8. It is pointed out that the statute i.e. West Bengal Act
provides that the rate of interest has to be 9% for one year and
thereafter 15%.
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9. It is submitted that the High Court took note of some
common passage concept. There was no lease and licence
arrangement with Purbasa Housing Estate. So ingress and
egress facilities were known. Because of the locational
advantage no deduction is called for any largeness. It is
pointed out that the High Court went wrong in not adding
land value for 7½ years. The High Court while considering the
largeness aspect has fixed 15 to 20%. It is the stand of Bariks
that largeness cannot be an issue in the present one. The
Reference Court rightly held that largeness question was not
relevant. It was a case of acquisition of contiguous land.
Largeness has to be linked to the purpose. The belting method
has no application because it was an open area for particular
purpose. Similarly, there was no question of any land locking.
The High Court observed, according to the Bariks, erroneously
that there was any access. The common passage was linked to
the main road. Since the purpose was to have protected area,
largeness question was not of any relevance. So far as the
frontage factor is concerned, it was submitted that for the
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purpose for which the land had been acquired frontage may
not be necessary. It has to be anywhere in the area.
10. Additionally, belting method is an obsolete method.
Further, belting is not a proper method as the land was
situated in well defined development block.
11. It has been pointed out by learned counsel for the
appellant that the purpose is really irrelevant for determining
market value. The potential has to be seen. It is a case of
willing buyer and willing seller. It is also pointed out that
number of ultimate claimants is really irrelevant because 20
sellers have to join if they have to sell the land and suit for
partition has to be filed.
12. The High Court has noticed the following factual
position.
(i) The acquired plot of land is about 150 to 200 ft.
away from the Manicktala Main Road. It is the third
belt away from the main road.
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(ii)
It is impossible to conclude that there is any
frontage of the acquired land on the southern side
where Manicktala main road runs.
(iii) So far as northern and southern sides of the
acquired plot are concerned it is admitted that
those are land bound. On the west there is other
land of Bariks and on the north there was a
housing estate called Purbasa Housing Estate.
13. The case of the appellant was that the plot which was
acquired for their use was wholly land locked. This forms a
very important factual issue which is important while
determining the compensation.
14. The issue was whether on the eastern side of the
acquired land there was a frontage on 40 ft. municipal public
road. The case of Bariks that this was so. On the other hand
the appellant took the stand that there was no municipal road
and it was a private land of Purbasa Housing leading from the
Manicktala Main road on the South into the Housing Estate
itself. The road runs south to north and belongs to Purbasa.
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That 40 ft wide road is not a municipal road and it has no
name. There are no premises numbers attached to it.
15. Interestingly, the witnesses of the appellant were asked a
question as to whether it had taken permission from the
Public Works Department for laying cables under the P.W.D.
road. No evidence was there to show that the road was a
public road or it connected with the Manicktala Main Road.
From the plan it appears that the road goes into the Purbasa
Housing Estate and ends there. Therefore, the plot was wholly
land locked. The High Court ultimately therefore fixed the
rates as noted above.
16. The armchair assessment of land value has to proceed
with common sense and circumspection. One should attempt
to find out the just and reasonable compensation without
attempting any mathematical precision in that regard. For the
purpose of assessing compensation, the efforts should be to
find out the price fixed for the similarly land in the vicinity.
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17. The difference in the land acquired and the land sold
might take on various aspects. One plot of land might be
larger, another small, one plot of land might have a large
frontage and another might have none. There might be
differences in land development and location. There might be
special features which have to be taken note of and
reasonably considered in the matter of assessing
compensation.
18. Where a very large plot of land has been acquired and
the comparison is sought to be made with a comparatively
small piece of land which has been sold or otherwise dealt
with, then in that event, a percentage of the price is to be
knocked off because of the largeness itself of the acquired
land. Accordingly, the High Court made the deductions. The
High Court also dealt with the question of land locking and
held that it was a special feature which had to be taken note
of.
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19. We do not find any infirmity in the approach of the High
Court. Therefore, the rate fixed by the High Court does not
suffer from infirmity. The appeals filed by the appellant-CESC,
therefore, stand dismissed.
20. Rate fixed by the High Court as questioned in the cross
appeals does not warrant interference. But there is substance
in the plea regarding rate of interest.
21. Section 7(2)(a) of West Bengal Act is as follows:
“7(2)(a)- When the compensation has been
determined under sub-section (1) the Collector
shall make an award in accordance with the
principles set out in section 11 of the Land
Acquisition Act, 1894 and the amount referred
to in sub-section (2) of section 23 of that Act
shall also be included in the award:
Provided that interest at the rate of nine
per centum per annum on the amount of
compensation under the award from the date
of the publication of the notice under sub-
section (1a) of section 4 until payment shall be
included in the amount payable under the
award:
Provided further that if such
compensation or any part thereof is not paid
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or deposited within a period of one year from
the date of publication of the notice under
sub-section (1a) of section 4, interest at the
rate of fifteen per centum per annum shall be
payable from the date of expiry of the said
period of one year on the amount of
compensation or part thereof which has not
been paid or deposited before the date of such
expiry.”
22. The rate of interest as statutorily fixed shall be applicable
in place of rate fixed by the Reference Court and the High
Court.
23. The cross-appeals are allowed to that limited extent.
There will be no order as to costs.
…………………………
J.
(Dr. ARIJIT PASAYAT)
…………………………J.
(P. SATHASIVAM)
New Delhi,
July 7, 2008
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