Gujarat HC Rejects Railways’ Appeal, Upholds Rs 348/Sq M Compensation Award For Gamla Land Acquired For Railway Line

The claimants’ agricultural lands at village Gamla, Dahod, were acquired for a railway line between Dahod and Indore.

Following Section 4 and Section 6 notifications in 2009, the Special Land Acquisition Officer awarded compensation at ₹11 per square metre.

On reference, the Reference Court enhanced compensation to ₹348 per square metre, with costs, interest and statutory benefits.

The Railway appealed, contending that the Reference Court had relied on awards concerning different villages and acquisitions, without adequately comparing the lands’ location, nature and potentiality.

The claimants relied, among other things, on the confirmed award concerning adjoining village Jalat and the earlier award for village Punsari.

The appeal was brought under Section 54 of the Land Acquisition Act, 1894, read with Section 96 of the Code of Civil Procedure.

In determining market value, an award concerning land in the same or an adjoining village may be relevant where the lands are comparable, but the court must consider their location, surrounding development, availability of land and demand.

General Manager, ONGC Ltd. v. Rameshbhai Jivanbhai Patel, (2008) 14 SCC 745, cautions that annual escalation based on an earlier transaction or acquisition is generally safer when the time gap is only four to five years; a longer gap requires care because rates may vary or stagnate.

Central Warehousing Corporation v. Thakur Dwarka Kalan Ul-Marruf Barglan Wala, 2023 INSC 940, recognises that, where comparable contemporaneous sales are unavailable, cumulative annual increases may be used, with the appropriate rate depending on the period and circumstances.

The High Court considered that Gamla is adjacent to Jalat and close to Punsari, and found no substantial difference in the lands’ nature and potentiality from those considered in the related proceedings.

The Division Bench had already examined the Jalat awards, which relied on the Punsari award, and confirmed them; it calculated that an 8% cumulative increase on the Punsari base value would produce a value exceeding the award under review, but declined enhancement because the acquiring body alone had appealed.

Considering that confirmation, the proximity of the villages, the area’s development and the nearby highway, the Court found no basis to disturb the Reference Court’s award.

It directed the Registry to return the record and proceedings to the concerned Tribunal.