Hirabai & Ors vs L.A.O. Cum Asst. Commnr

representatives of the deceased appellants pending consideration are allowed while condoning delay, directing

substitution of the names of the legal representatives in place

of deceased appellants. The said applications are accordingly

disposed of by this common order.

2. Having passed an order for substitution of the legal

representatives in place of the deceased appellants, we now

proceed to dispose of all these appeals by this common

judgment and order as all these appeals are interconnected

and issues raised and urged are almost identical in nature.

3. The Government of Karnataka issued a preliminary

notification under Section 4(1) of the Land Acquisition Act,

1894 [for short "the Act"] proposing to acquire lands for the

Bhima River Lift Irrigation Project which was published in

the Government Gazette on 08.06.1995 by which the

Government proposed to acquire lands belonging to the

appellants herein. The lands proposed to be acquired consist

of both irrigated and dry lands pertaining to Devangaon

Village, Bijapur District. Subsequently, the State Government

also issued declaration under Section 6 of the Act on

2 25.01.1996. Subsequent to the aforesaid issuance of

notification under Section 4(1) followed by the notification

under Section 6 of the Act, the Land Acquisition Officer

passed an award on 14.12.1996 whereby he fixed the

compensation and the market value of the acquired irrigated

land at the rate of Rs. 15,000/- per acre and for the dry

lands at Rs. 13,000/- per acre.

4. Aggrieved by the aforesaid award, reference applications were

filed by the claimant - appellants on the basis of which a

reference was made to the reference court. Before the

reference court parties adduced evidences both oral and

documentary. At the conclusion of the trial, the reference

court enhanced the compensation of dry lands from Rs.

13,000/- per acre to Rs. 31,500/- per acre by way of

judgment and order dated 31.01.2000 and so far as the

irrigated lands are concerned, the reference court by way of

its judgments and orders dated 08.04.1999 and 13.12.1999

enhanced the compensation of irrigated lands from Rs.

15,000/- per acre to Rs. 45,900/- per acre.

3

5. The claimants preferred appeals before the High Court of

Karnataka and the High Court by the impugned judgments

and orders enhanced the market value for the irrigated lands

and determined the same at the rate of Rs. 75,600/- per acre

and in respect of dry lands the High Court determined the

market value at Rs. 38,000/- per acre. Being aggrieved by

the aforesaid judgments and orders passed by the High

Court, the present appeals were filed in this Court, in which

we have heard the learned counsel appearing for the parties.

6. The learned counsel appearing for the appellants contended

before us that the High Court was wrong in applying the

capitalisation method of valuation for calculating the market

value of both the categories of lands. In order to strengthen

her argument, she had extensively taken us through the

judgments and orders of the High Court, reference court and

also the other evidences on record.

7. The first submission which was advanced before us by the

counsel appearing for the appellants was that the High Court

was wrong to hold that appellants have restricted their

4 claims at Rs. 80,000/- per acre whereas it is shown from the

claim petition filed before the reference court that the claim

was made at Rs. 1,00,000/- per acre, although, appellants

paid the court fee only at Rs. 80,000/- per acre for the lands

in question. Therefore, on this basis, we find that there was

nothing wrong on the part of the Division Bench of the High

Court mentioning that the prayer of the appellants was to fix

the market value of the acquired land at Rs. 80,000/- per

acre.

8. The next contention of the counsel appearing for the

appellants is that the High Court was unjustified to reject the

certificate dated 24.02.1996 [Exhibit P-71] issued by the

Assistant Director of Agriculture, Sindgi in respect of

agricultural land in Devangaon Area indicating a standard

yield of sugarcane as 60 tonnes per year per acre. She also

submitted that the market value of the irrigated lands in the

present case should be decided on the basis of a similar case

in which Rs. 79,000/- was awarded by the Land Acquisition

Officer himself for the sugarcane growing lands by way of a

consent award dated 20.10.1997 in respect of the lands

5 which were acquired under preliminary notification dated

08.08.1996 at Vadahalli Village in Bagalkot Taluk. Relying on

the same, the counsel for the appellants submitted that even

if the claim of the appellants for fixing the market value of

land at Rs. 1,00,000/- per acre is not accepted by the court,

the market value should be fixed on the basis of the market

value fixed for sugarcane growing lands of Vadahalli Village

in Bagalkot Taluk as per the award of Land Acquisition

Officer dated 20.10.1997.

9. Counsel appearing for the respondent, however, supported

the impugned judgments and orders and relying on the same

submitted that the said orders do not call for any

interference by this Court.

10.In the present case we are concerned with the acquisition of

irrigated lands and dry lands. By issuing the aforesaid

preliminary notification issued under Section 4(1), lands of

the appellants were acquired. Having carefully scrutinized

the judgment of the Division Bench of the High Court, we

find that the High Court has examined the issue of

6 determining fair and just market value of the lands from

various angles.

11.Appellants drew the attention of the High Court to a certified

copy of the sale deed relating to sale of one acre of land in Sy.

No. 109/2 [Exhibit P-26] of Kallahalli Village situated at a

distance of 3 kilometers from the acquired lands. The said

sale deed indicates that the aforesaid land was sold at the

rate of Rs. 75,000/- per acre on 05.07.1994 which is about

one year prior to the date of the preliminary notification in

the present case. The encumbrance certificate relating to Sy.

No. 1/5 of Kallahalli Village, which shows that the said land

measuring 1 acre 25 guntas was sold for a consideration of

Rs. 1, 15,000/- per acre and was marked as Ex. P-27, was

also produced before the High Court by the appellants.

12.The aforesaid documents, filed on behalf of the appellants to

justify their claim at Rs. 1,00,000/- per acre, were not

accepted by the High Court as the aforesaid lands covered by

the said sale deeds were lands which were situated at a

distance of 2 to 3 kilometers from the acquired lands. There

7 is no definite evidence to indicate the nature and quality of

the said land, and hence there is nothing on record to show

their comparability with the acquired lands. We are of the

considered opinion that the High Court rightly kept the said

sale deeds out of its consideration for lands situated about 2

to 3 kilometers away, which could not be said to be

comparable lands with that of the acquired lands. There was

no other direct documentary evidence which could prove and

establish or act as a guide in determining the market value of

the acquired lands. Therefore, the High Court fell back upon

the capitalisation method of valuation for the acquired lands

and in that process it relied upon the extract of the Fully

Revised Estimate of Area, Production & Average yield of

Commercial Crops in Karnataka for 1995-96 published by

the Directorate of Economics and Statistics. According to the

Division Bench of the High Court the said document was the

safe guide to determine the market value of the acquired

lands on the basis of capitalisation method.

13.The High Court considered the said document of Directorate

of Economics and Statistics and found therefrom that during

8 1995-96, the relevant year in which the notification for

acquisition of the land in the present case was issued, the

average yield of sugarcane per hectare was 90 tonnes for the

State of Karnataka and the average yield per hectare for

Bijapur District was 106 tonnes and, therefore, according to

the Division Bench average yield per acre was 36.422 tonnes

[rounded off to 36 tonnes] for Karnataka and 42.89 tonnes

for Bijapur District.

14.There was no dispute with regard to the fact that price of

jaggery at the relevant time was Rs. 700/- per quintal and on

the basis thereof and after making calculation, the High

Court came to the finding that the market value on the

capitalisation method would come to Rs. 75,600/- for the

acquired sugarcane growing irrigated lands. The calculations

on the basis of which the aforesaid figure was arrived at by

the High Court in its judgment are stated at para 18 which

reads as follows: -

"18. .............. It is well-settled and recognized that one ton of sugarcane will yield one quintal of jaggery. If Rs. 700/- is the price of jaggery per quintal, 40% has to be deducted towards

9 cost of conversion of sugarcane into jaggery, overheads, profit of dealer, and transportation. The balance will be Rs. 420/-. Out of it, 50% will have to be deducted towards cost of cultivation. Therefore, net realization will be Rs. 210/- per tonne of sugarcane. For 36 tonnes the realization will be Rs. 7,560/-. Thus the value of net yield will be Rs. 7,560/-. Thus the value of net yield will be Rs. 7,560/- per acre after expenses. By applying the multiplier of 10, for capitalisation, the market value will be Rs. 75,600/-."

15.The aforesaid calculation made by the Division Bench of the

High Court was challenged before us by the counsel

appearing for the appellants contending inter alia that the

aforesaid document on which reliance was placed by the

High Court, although issued by a Government Department,

the same should not have been accepted as it was not

produced in the evidence. It was also submitted by her that

reliance instead should have been placed on the certificate

produced by her dated 24.02.1996 issued by the Assistant

Director of Agriculture, Sindgi giving particulars of the yield

in respect of the lands in Devangaon Village indicating

standard yield of sugarcane as 60 tonnes per year per acre.

Relying on the said document, it was submitted by her that

10 as one tonne of sugarcane could yield about a quintal of

jaggery and hence the yield of jaggery would be 60 quintals of

jaggery which is of the value of Rs. 42,000/- and if 50 % was

deducted towards cost of cultivation, the net yield was Rs.

21,000/- and by capitalizing it with the multiplier factor of

10, the market value would be Rs. 2,10,000/- per acre.

16.When we consider the aforesaid submission in the light of

the records we find that at least in two respects there is

agreement between the parties, i.e., to the extent of sale price

of jaggery being Rs. 700/- per quintal and that for

capitalizing the market value the multiplying factor should be

10.

17.The aforesaid certificate dated 24.02.1996 was shown to

have been issued by the Assistant Director of Agriculture,

Sindgi but Assistant Director himself was not examined nor

anybody from his office was examined to indicate as to under

what circumstances the aforesaid certificate was issued and

what is the basis of giving such a certificate and also to show

what is the method of calculation to arrive at the aforesaid

11 statistics. The said document was produced by the

appellants very casually and without there being any further

evidence in support of the aforesaid contents of the

certificate. It is not safe to rely on such a certificate, shown to

have been issued by a Government officer without the author

of the said certificate being produced for testing the veracity

of the certificate and the contents thereof.

18.Reliance was also placed by the counsel appearing for the

appellants on the consent award which however again was

not accepted by the High Court and rightly so, we feel,

because the same was a consent award which cannot be said

to be binding on the parties hereto. Therefore, there was no

valid document in the instant case wherefrom it can safely be

deduced as to what the exact market price of the land in

question could be. Therefore, there was no other option but

to fall back upon the capitalisation method of valuation as

there is no other safe and reliable evidence available on

record. While calculating market value of the land on the

basis of such capitalisation method of valuation, the High

Court relied on the aforesaid Government document

12 published by the Directorate of Economics and Statistics

which was also pertaining to the relevant year in question,

i.e., 1995-96. According to the said document which was

accepted as a reliable document, average yield per acre was

36.422 tonnes [rounded off to 36 tonnes] for Karnataka and

42.89 tonnes for Bijapur District. The High Court accepted

the main statistics for arriving at the market value of the

land. On going through the format and method of calculation

as appearing from paragraphs 16 and 18 of the judgment

and order of the Division Bench of the High Court, we do not

find any reason to interfere with the same as the said

calculation is found to be just and appropriate. Without any

disputing material on record, we do not see as to why we

should not accept the deduction of 40 per cent towards cost

of conversion of sugarcane into jaggery and if that is accepted

the remaining basis of the calculation is found to be

appropriate, as even according to the appellants, 50 per cent

could be deducted towards cost of cultivation which was also

the submission of the counsel appearing for the appellant as

appearing from paragraph 7 of the judgment itself.

13

19.Having decided thus, with regard to the determination of

market value of the irrigated lands, we now focus our

attention to the determination of the market value for the dry

lands which was fixed by the High Court at Rs. 38,000/- per

acre. There again, the High Court relied upon the earlier

decision of the Division Bench in respect of the land of the

same village which was also acquired for the same purpose

by the same notification. The aforesaid decision on which

reliance was placed by the High Court in its judgment is also

placed on record and on going through the same we find that

the aforesaid decision to fix the market value of the land at

Rs. 38,000/- was arrived at on the ground that the market

value of the irrigated lands would be taken as about one-and-

half times of the value of dry lands. After making 25%

deduction from the market value fixed for the sugarcane

growing irrigated lands, the Division Bench of the High Court

arrived at a finding that the market value of the other

irrigated land would be around Rs. 57000/-per acre, and

consequent thereto, the High Court fixed the amount of Rs.

38,000/- per acre for the dry land taking notice of one and

14 half time calculation. The aforesaid calculation given by the

High Court could not be assailed by the counsel appearing

for the appellants by giving any other justification.

20.Once we have agreed with the findings of the Division Bench

of the High Court to fix the market value of the sugarcane

growing irrigated lands at Rs. 75,600/- per acre, necessarily,

for the dry land the market value shall have to be held to be

fixed at Rs. 38,000/- per acre, by following the aforesaid

criteria which is ordinarily accepted and followed and also to

be rational.

21.In that view of the matter we do not find any reasonable

ground to interfere with the decisions of the High Court for

fixing the market value of sugarcane growing irrigated lands

at Rs. 75,600/- and at Rs. 38,000/- for the dry lands. We,

therefore, find no merit in these appeals which are dismissed,

but we leave the parties to bear their own costs.

.......................................J. [Dr. Mukundakam Sharma]

15 .......................................J. [Anil R. Dave]

New Delhi, September 23, 2010.

16