Pre-amended Section 25 bars land-acquisition compensation exceeding the claimant’s amount claimed.

The State acquired land belonging to the appellant in village Maharajpur, Pargana Loni, tehsil Ghaziabad, for planned industrial development through a notification under Section 4(1) of the Land Acquisition Act, 1894, published on 23 December 1967.

Possession was taken on 23 December 1969, and the Collector’s award dated 13 September 1971 assessed compensation at ₹1.30 per square yard.

The appellant claimed that it had acquired and partially developed the land for residential and industrial schemes, and that its market value was substantially higher.

The Collector relied on 25 sale transactions from the same village but rejected a transaction reflecting ₹14 per square yard on the ground that it involved only 150 square yards purchased by a coloniser for commercialisation.

The Reference Court held that 37 bigha 2 biswa had been acquired, but upheld the Collector’s valuation, while awarding solatium at 15% and interest at 6% per annum.

The appellant challenged the award under Section 54 of the Act read with Section 96 CPC, seeking enhancement.

Whether the unamended Section 25 of the Land Acquisition Act, 1894, applied to the determination of compensation in the present proceedings.

Whether the potentiality of the acquired agricultural land for residential and industrial use was relevant in determining its market value.

Whether the compensation awarded in Ghaziabad Development Authority v. Anoop Singh and Ghaziabad Development Authority v. Ram Krishana could be considered for assessing the value of the appellant’s land.

Whether the compensation required enhancement and, if so, the rate to which the appellant was entitled.

Section 25 of the Land Acquisition Act, 1894, as it stood before its amendment, prohibited the Reference Court from awarding more than the amount claimed by the landowner where a claim had been made pursuant to Section 9; the amended provision, effective from 24 September 1984, was not retrospective.

This principle was affirmed in Land Acquisition Officer-cum-DSWO, A.P. v. B.V. Reddy & Sons, (2002) 3 SCC 463, and Stanes Higher Secondary School v. Special Tahsildar (Land Acquisition), Civil Appeal No. 321 of 2002, decided on 9 March 2010.

Market value must account for the land’s potentiality, meaning its existing use or the use to which it was reasonably capable of being put, having regard to location, access, amenities and proximity to residential, commercial or industrial development; the Court relied on Bijender v. State of Haryana, (2018) 11 SCC 180, Sajan v. State of Maharashtra, (2020) 14 SCC 139, and Ram Kishan v. State of Haryana, 2025 INSC 441.

Earlier awards and judgments are relevant pieces of evidence but are not automatically binding; their comparability, location, timing, nature of land and evidentiary foundation must be examined, as held in Manoj Kumar v. State of Haryana, (2018) 13 SCC 96, Printers House (P) Ltd. v. Saiyadan, (1994) 2 SCC 133, and related authorities.

The statutory entitlement to solatium under Section 23(2) and interest under Section 28, as applicable under the pre-amended law, was also recognised.

The Court held that the acquisition notification, Collector’s award and Reference Court’s judgment all preceded 24 September 1984; therefore, the unamended Section 25 governed the appeal and limited the award to the amount claimed by the appellant.

The appellant had claimed at least ₹12 per square yard before the Collector, while its evidence showed purchase prices of ₹1.50–₹4.50 per square yard, efforts toward levelling and plotting, and an intended industrial and residential development.

The acquired land was situated on a functional link road between Mohan Nagar and New Delhi, approximately 8 km from Connaught Place, and near existing industrial establishments.

These circumstances established substantial development potential notwithstanding that the land had not been fully developed.

The Court treated the decisions in Anoop Singh and Ram Krishana not as mechanically binding precedents, but as relevant evidence demonstrating prevailing values in a geographically comparable area; it also noted that the appellant’s land was closer to New Delhi and had been acquired later, in 1967.

Balancing the evidence, the appellant’s pleaded claim, the land’s potentiality and the limitations under unamended Section 25, the Court considered ₹20 per square yard to be a just and reasonable market value.

Compensation was enhanced from ₹1.30 to ₹20 per square yard.

The appellant was also held entitled to 15% solatium and 6% annual interest on the compensation, including solatium, from the date of possession until actual payment.

However, because the deficiency in court fees was cured only on 27 July 2004, no interest on the enhanced compensation was payable for the period from 21 October 1980 to 26 July 2004.

The respondents were directed to pay the enhanced amount within two months, with parties bearing their own costs.