Kolkata Metropolitan Devt.Authority vs Gobinda Chandra Makal & Anr

Kolkata Metropolitan Development Authority ... Appellant

Vs.

Gobinda Chandra Makal & Anr. ... Respondents

And

C.A. Nos. 1931, 1932 and 1933 of 2008

State of West Bengal ... Appellant

Vs.

Gobinda Chandra Makal & Anr. ... Respondents

J U D G M E N T

R.V.RAVEENDRAN, J.

These appeals by the Kolkata Metropolitan Development Authority

(for short KMDA) and the State of West Bengal (`State' for short) relate to

determination of compensation for acquisition of the following three lands

for East Calcutta Area Development Project, falling under Mouza

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Madurdaha, (JL No.12), District 24 Parganas (South) within the limits of

Kolkata Municipal Corporation :

Dag (Plot) Area in Cottahs/Chitaks Area in Acres Classification of land

No. (1 acre = 60 cottahs)

(1 cottah = 16 Chitaks)

62 117 Cottah 1.94 acres Sali (Agricultural)

42 37 Cottahs 0.61 acres Sali (Agricultural)

272 13 Cottahs 5 Chitaks 0.22 acres Beel (Marsh)

2. The said lands belonging to the first respondent along with

surrounding lands were requisitioned by the State Government under section

3(1) of the West Bengal Land (Requisition & Acquisition) Act, 1948 [for

short `WB Requisition Act'] on 27.4.1978. The possession of the land was

taken by the Collector in pursuance of such requisition, on 8.5.1978,

16.7.1979 and 16.9.1979. In anticipation of the acquisition, the value of the

land was assessed under section 8B of the said Act and 80% of the estimated

compensation was paid to the first respondent in or about 1979. On

7.4.1987, the Collector issued a notification under section 4(1a) of the said

Act, to acquire the land, but did not make an award under section 7 of the

said Act. WB Requisition Act was a temporary Act and remained in force

only till 31.3.1997. The Land Acquisition Act 1894 (`LA Act' for short) was

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amended by West Bengal Act 7 of 1997 (with effect from 2.5.1997)

inserting sub-sections (3A) and (3B) in section 9 of LA Act whereby it was

provided that in regard to lands possession of which had been taken on

requisition under the WB Requisition Act, the proceedings initiated under

the WB Requisition Act would stand converted to proceedings under LA

Act upon issuance of appropriate notice. Such notice was issued on

10.12.1997 and the acquisition proceedings under the WB Requisition Act

were converted into acquisition proceedings under the LA Act. But as no

award was made within a period of two years, the said acquisition lapsed

under section 11A of LA Act. Therefore, fresh acquisition proceedings were

initiated by issue of a notification dated 13.9.2000 under section 4(1) of the

LA Act (Gazetted on 13.9.2000 and thereafter published in the newspapers

and pubic notice of the substance of notification was notified in the locality

on 16.11.2000) followed by a notification dated 27.11.2000 issued under

section 6 of the LA Act (gazetted on 28.11.2000).

3. The Collector made an award dated 13.12.2001 determining the

market value of the acquired lands as ` 2386 per cottah for sali land and `

1193 per cottah for beel land. For this purpose, the Collector took the

average of the value disclosed by the sale of small plots bearing Dag Nos.

4 417, 417 and 455 under deeds dated 15.1.1982, 20.1.1982 and 15.2.1982

and by providing appreciation at the rate of 5% per year from 1982 to 2000,

arrived at the value of ` 144,353/- per acre or ` 2386/- per cottah for sali

land and ` 1193/- per cottah (half of the value of sali land) as the value of

beel land. Feeling aggrieved, the first respondent sought reference to civil

court claiming enhancement in regard to the three lands. The three

references were registered as LA Nos.47, 77 and 78 of 2003.

4. The first respondent examined an expert valuer T.C.Roy as RCW-1

and examined himself as RCW-2. The report of the expert with its annexures

was marked as Ex. 1 and Ex. 1/A and the map of Mouza Madurdaha was

produced as Ex.2. The first respondent produced and relied upon the

following five sale deeds (Ex.7 to 11) to prove the market value :

Date of sale Plot Number Extent Price per cottah Nature of land

8.1.1999 417 5 cottah ` 70000 Beel

8.1.1999 417 5 cottah ` 70000 Beel

29.3.2000 417 3 cottah 1 chitak ` 65,396 Beel

25.6.1999 445 3 cottah 5 sq. ft. ` 80,000 Beel

10.3.2000 192 1.5 cottah ` 100,000 Sali

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On behalf of the State Government represented by the Collector, the award

was marked as Ex.A, two sale deeds of the year 1988 relied upon by the

Collector for determining the market value were marked as Ex.B and B/1,

the determination of land value by the Collector as Ex.C, calculation-sheet

for payment of 80% ad hoc compensation as Ex.D and an area map as Ex.E.

KMDA did not lead any evidence.

5. The Expert Valuer assessed the value of the acquired lands with

reference to the sale of Sali plot No.192 Mouza Madurdaha, Ward No.108,

Kolkata Corporation, measuring 1.5 cottah sold under a deed dated

10.3.2000 at a price of ` 1 lakh per cottah. The access to that plot was

through a eight feet wide passage. According to the valuer, plot no.62 was

by the side of Anandpur main road of a width of 20 to 25 feet and Plot

No.42 adjoined a kutcha road of a width of about 20 feet. Being of the view

that the acquired plots had a more advantageous position when compared to

plot no.192, the valuer made several additions to the value disclosed by sale

of plot no.192. He thereafter made a cut in the value in view of the larger

size of the acquired plots. The valuer gave a valuation report dated

20.6.2002 assessing the value of plot No.62 at ` 143,000 per cottah, plot

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No.42 at `135,000 per cottah and plot No.272 at ` 108,000 per cottah. The

abstract of the method of calculation adopted by the valuer is as under :

Description Plot No.62 Plot No.42 Plot No.272

Base rate (Re : Plot No.192 under deed `100,000 `100,000 `100,000 dated 10.3.2000) per cottah per cottah per cottah

Add for appreciation in market value +8% +8% +8%

during a period of 8 months (between

10.3.2000 and 16.11.2000) at the rate

of 12% per annum

Add for advantage of frontage towards +20% +10% +20%

a road (as against common passage

frontage of plot no.192)

Add for FAR advantage on account of +25% +20% +30%

frontage to a road

Add for advantage of facing East +5% +7% -

Deduction on account of development -15% -10% -50%

cost (small size to big size)

Net addition to be made +43% +35% +8%

(58% - 15%) (45% - 35%) (58% - 50%)

Value of plots `143,000 `135,000 `108,000

per cottah per cottah per cottah

6. The Reference Court on considering the evidence was of the view that

the valuation by the expert valuer should be accepted subject to one

modification. The Reference Court found that the valuer had deducted only

15% and 10% from the price of a small developed plot, to determine the

market value of plot no.62 and plot no.42. He accepted the submission of

appellants that having regard to situation and nature of land, to arrive at the

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value of the acquired lands (large undeveloped lands) from the value of a

small developed plot (plot no.192), the deduction should be one-third (that is

33.33%). By making such deduction (instead of 15% for plot no.62 and 10%

for plot no.42 applied by the valuer) the Reference Court arrived at the

market value as `125,000 per cottah for plot no.62 and ` 112,000 per cottah

for plot No.42. He took the average thereof as ` 118,000 and by rounding it

off fixed the compensation as `120,000/- per cottah for sali plots No.62 and

No. 42.

7. The Reference Court also attempted an alternative method of

determining the market value with reference to the four sale-deeds in regard

to beel Plots Nos.417 and 445 and held that the valuation of acquired lands

with reference to the said sales statistics would be approximately Rs.134,000

per cottah. The Reference Court found that Plot Nos. 417 and 445 were sold

in the years 1999 and 2000 under four sale-deeds and assumed the sale price

in the year 2000 to be ` 80,000/- per cottah. On the ground that the exemplar

plot (No.192) did not have ingress and egress, 25% was added to that value

to arrive at the value of the acquired lands which had better ingress and

egress. Having arrived at a figure of Rs.1 lakh per cottah, the Reference

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Court applied a cut of 33.3% towards development cost and arrived at the

price for beel plots as ` 67,000/- per cottah; and as the value of sali plots

were double that of beel plots, he doubled the said figure and arrived at the

market value of sali plots as ` 1,34,000/-.

8. In view of the above, he choose to determine the market value of Sali

land (plot nos. 62 and 42) as `120,000 per cottah. As the value of beel land

was 50% of the value of Sali land, he determined the market value of beel

land (plot no.272) as `60,000/-. The Reference Court therefore made an

award dated 11.10.2004 awarding `120,000 per cottah for Sali plots (plot

nos.62 and 42) and ` 60,000 per cottah for Beel plot (plot no.272) with

statutory benefits. Feeling aggrieved, KMDC as well as State of West

Bengal have filed appeals. The Calcutta High Court dismissed the appeals

by judgment dated 18.5.2007 thereby affirming the compensation awarded

by the Reference Court.

9. KMDC and the State of West Bengal have challenged the said

decision of the High Court in these appeals by special leave, raising the

following four contentions:

(i) The first respondent had himself relied upon the four sale deeds

relating to beel lands that is sale deeds dated 8.1.1999, 8.1.1999 and

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29.3.2000 relating to plot no.417 and sale deed dated 25.6.1999 relating to

plot no.445 disclosing a price of ` 70,000, ` 70,000, ` 65,396 and ` 80,000

per cottah. Though the plots were described as beel lands in the sale deeds,

qualitatively they were the same as sali lands on account of the fact that the

area had been developed into residential plots and fell within the municipal

corporation limits. Therefore the market value of the acquired lands ought to

have been determined with reference to the price disclosed by the said plots.

The Reference Court had wrongly doubled the value worked out with

reference to these sale deeds, by applying the thumb rule that the value of

sali lands were twice that of the value of beel lands.

(ii) Even if the sale deed dated 10.3.2000 relating to sali plot no.192

should be the basis for determination of market value, making any additions

thereto as per the Expert Valuer's report on account of appreciation of price

during eight months, or on account of frontage advantage or on account of

plots facing east, was not warranted. Therefore the additions of 58% to the

value of plot no.62, 45% to the value of plot no.42 and 58% to the value of

plot no. 272 was liable to be set aside.

(iii) Having regard to the fact that the acquired lands were large tracts of

undeveloped land and their sale price was being determined with reference

to value of a small residential plot namely plot no. 192, the cut or deduction

towards development and development cost ought to have been at least 50%

instead of 33.33%.

(iv) When possession of the lands were taken in pursuance of the

requisition under the WB Requisition Act, 80% of the estimated value of the

10

lands was paid to the first respondent and the first respondent had accepted

the same. Therefore what should be paid to the first respondent was only the

balance of 20% of the compensation as was to be determined. As the first

respondent had the benefit of the said advance amount, from the year 1979,

the amount paid as advance with appropriate interest thereon, should be

adjusted against the compensation.

Re : Contention (i) :

10. The appellants submitted that the first respondent had produced and

relied upon four sale deeds relating to Beel lands, and they ought to have

been the basis for determination of compensation for the acquired lands.

These sale deeds disclosed that three portions of Plot No.417 measuring 5

cottah, 5 cottah and 3 cottah 1 chitak were sold under sale deeds dated

8.1.1999, 8.1.1999 and 29.3.2000. The price per cottah under the first two

sale deeds is ` 70,000/- per cottah and under the third sale deed is about

`65,400/- per cottah. The fourth sale deed dated 25.6.1999 relates to sale of

3 cottah and 5 sq.ft. in plot No.445 which discloses the price paid as `

80,000 per cottah. The average of the four sales would be about ` 71,350 per

cottah. According to the appellant though these plots were described as Beel

lands because they were originally classified as `Beel', they were no longer

Beel, but were developed and sold as residential plots, and situated in the

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limits of Ward No.108 of Kolkata Municipal Corporation. Therefore, they

were no different from the plots laid down in Sali lands. Consequently, it

was submitted that the value of these residential plots should be treated on

par with the plots laid in Sali lands and their value could not be considered

as half of the value of Sali lands. The appellants contend that though the

Reference Court considered these sale deeds, it erroneously doubled the

value disclosed by these plots to arrive at the value of Sali plots merely

because they were described as Beel lands. According to the appellant, once

the Beel lands are developed into residential plots by drawing, filling and

levelling, the value of Sali plots and Beel plots are the same. Therefore, it is

contended that on the basis of these sale deeds, the prevailing value of

residential plots in the area ought to have been taken as `71,350 per cottah

and by deducting one-third (33.33%) therefrom towards development, the

value of the acquired lands irrespective of whether they are Sali or Beel,

should be fixed as ` 47,570 per cottah.

11. We have carefully considered the said contention. It is possible that

Beel lands when developed into residential plots, by draining, filling and

levelling the land, will cease to be Beel in nature. But it is also possible that

the plots sold under sale deeds dated 8.1.1999, 25.6.1999 and 29.3.2000

12

were really Beel plots without any actual development. There is no evidence

to show that these plots were drained, filled, levelled and made into plots

similar to Sali plots. The sale deeds refer to these plots as Beel plots. There

is no dispute that at the relevant point of time the Sali plots were considered

to be more valuable than Beel plots. Therefore we reject the contention of

the appellant that the value of these Beel plots should be treated on par with

the value of Sali plots and that should form the basis for determining the

market value of Sali Plot Nos.62 and 42. But the value of these Beel plots

can be a clear indicator for determining the value of acquired Beel plot

No.272.

Re : Contention (ii)

12. The Reference Court and the High Court have not disapproved or

rejected the various additions made by the Expert Valuer for `advantages'

possessed by plot nos.62, 42 and 272. We will consider each of these

`advantages' separately.

13. The valuer has added 8% towards appreciation in value during the

period of eight months between the date of the exemplar sale (10.3.2000)

and the date of preliminary notification (which was taken as 16.11.2000).

13 The date of publication of the said notification is 13.9.2000. Only about six

months had passed from the date of the exemplar sale deed (10.3.2000),

when the preliminary notification regarding the acquisition was issued in the

same year namely 2000. (The difference would be eight months even if the

date of publication of preliminary notification is taken as 16.11.2000). When

the relied upon sale transaction and the preliminary notification are in the

same year, no provision is made for any appreciation in value. This Court in

ONGC Ltd. vs. Rameshbhai Jivanbhai Patel - (2008) 4 SCC 745 observed :

"However, for the purpose of calculation, we have to exclude the year of

the relied-upon transaction, which is the base year. If the year of relied-

upon transaction is 1987, the increase is applied not from 1987 itself, but

only from the next year which is 1988."

Therefore, unless the difference is more than one year, normally no addition

should be made towards appreciation in value, unless there is special

evidence to show some specific increase within a short period. Therefore,

the addition of 8% to the price (Rs.100,000/- per cottah) of plot no.192, was

unwarranted.

14. The Expert valuer has added to the basic value of ` 1,00,000/-

(relating to plot No.192), 20% for plot no.62 for having a frontage to

Anandpur main road, 10% for plot no.42 for having a frontage to a kutcha

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KMC road, and 20% for plot No.272 for having a frontage to a sixty feet

wide road, on the ground that these three lands were more advantageously

situated when compared to plot No.192 which faces a narrow eight feet

common passage. The valuer has made one more addition to the basic value

on account of frontage advantage of the acquired plots, that is 25%, 20% and

30% respectively for plot nos.62, 42 and 272 for having a frontage on a

wider road thereby giving the advantage of a better FAR (floor area ratio)

when undertaking construction. Addition of percentages for advantageous

frontage, that too twice was unwarranted. Advantage of a better frontage is

considered to be a plus factor while assessing the value of two similar

properties, particularly in any commercial or residential area, when one has a

better frontage than the other. However where the value of large tracts of

undeveloped agricultural land situated on the periphery of a city in an area

which is yet to be developed is being determined with reference to a value of

nearby small residential plot, the question of adding any percentage for the

advantage of frontage to the acquired lands, does not arise. Therefore, the

entire addition for frontage, that is 45%, 30% and 50% respectively for plots

62, 42 and 272, have to be deleted.

15 15. Lastly, the Expert Valuer has added 5% for plot No.62 for the

advantage of being an east facing plot and 7% for plot no.42 for the

advantage of being an east & east/south facing plots. When a large tract of

land is made into several plots, most of the plots will cease to be east facing.

Further, addition in value for facing a particular direction cannot be

accepted.

16. Therefore, the addition of 58% for plot nos.62 and 272 and addition of

45% for plot no.42 have to be deleted. The market value of plot nos.62 and

42, should be arrived at by making an appropriate cut from the value derived

from sale price of plot No.192, namely ` 1 lac per cottah. The market value

of plot no.272 should be arrived at by making an appropriate cut from the

market value of Rs.71,350/- arrived at with reference to sale of beel lands.

Re : Contention (iii)

17. In Administrator General of West Bengal vs. Collector, Varanasi -

(1988) 2 SCC 150, this Court has explained the principle for valuing large

extent of undeveloped urban land with reference to the price fetched by a

small developed plot. This Court explained that prices fetched for small

plots cannot form safe basis for valuation of large tracts of land and cannot

be directly adopted in valuation of large tracts of land as the two are not

16

comparable properties - the former reflects the `retail' price of land and the

latter the `wholesale' price. However, if it is shown that the large extent to

be valued does admit of and is ripe for use for building purposes; that

building lots that could be laid out on the land would be good selling

propositions and that valuation on the basis of the method of a hypothetical

layout could with justification be adopted, then in valuing such small laid

out sites the valuation indicated by sale of comparable small sites in the area

at or about the time of the notification would be relevant. In such a case,

necessary deductions for the extent of land required for the formation of

roads and other civic amenities; expenses of development of the sites by

laying out roads, drains, sewers, water and electricity lines, and the interest

on the outlays for the period of deferment of the realization of the price; the

profits on the venture etc., are to be made. From the value of small plots

which represents what may be called the `retail' price of land, the

`wholesale' price of land is to be estimated. In Chimanlal Hargovinddas vs.

Special Land Acquisition Officer, Poona - (1988) 3 SCC 751, this Court

gave the following illustration to arrive at the value of large undeveloped

land from the value of a small developed plot :

"A building plot of land say 500 to 1000 sq.yds cannot be compared with

a large tract or block of land of say 10,000 sq.yds or more. Firstly, while a

smaller plot is within the reach of many, a large block of land will have to

17

be developed by preparing a lay out, carving out roads, leaving open

space, plotting out smaller plots, waiting for purchasers (meanwhile the

invested money will be blocked up) and the hazards of an entrepreneur.

The factor can be discounted by making a deduction by way of an

allowance at an appropriate rate ranging approximately between 20% to

50% to account for land required to be set apart for carving out lands and

plotting out small plots. The discounting will to some extent also depend

on whether it is a rural area or urban area, whether building activity is

picking up, and whether waiting period during which the capital of the

entrepreneur would be locked up, will be longer or shorter and the

attendant hazards."

18. By comparing the situational advantage, existing development and

amenities available to the acquired lands and the exemplar sale transactions

relating to small plots, and other relevant circumstances, this Court has made

cuts or deductions varying from 20% to 75% from the value of the small

developed plots to arrive at the value of acquired lands. [See : K.

Vasundara Devi vs. Revenue Divisional Officer (LAO) - (1995) 5 SCC 426;

Basavva vs. Special Land Acquisition Officer - (1996) 9 SCC 640; Shaji

Kuriakose vs. Indian Oil Corporation Ltd - (2001) 7 SCC 650; Atma Singh

Thr. LRs. vs. State of Haryana - (2008) 2 SCC 568 and Kanta Devi vs. State

of Haryana - (2008) 15 SCC 201], and and Lal Chand vs. Union of India -

(2009) 15 SCC 769]. In Lal Chand, this Court gave the following guidelines

as to what should be the deduction for development :

"The percentage of 'deduction for development' to be made to arrive at the

market value of large tracts of undeveloped agricultural land (with

potential for development), with reference to the sale price of small

developed plots, varies between 20% to 75% of the price of such

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developed plots, the percentage depending upon the nature of development

of the lay out in which the exemplar plots are situated.

The 'deduction for development' consists of two components. The first is

with reference to the area required to be utilised for developmental works

and the second is the cost of the development works. For example if a

residential layout is formed by DDA or similar statutory authority, it may

utilise around 40% of the land area in the layout, for roads, drains, parks,

play grounds and civic amenities (community facilities) etc.

The Development Authority will also incur considerable expenditure for

development of undeveloped land into a developed layout, which includes

the cost of levelling the land, cost of providing roads, underground

drainage and sewage facilities, laying waterlines, electricity lines and

developing parks and civil amenities, which would be about 35% of the

value of the developed plot. The two factors taken together would be the

`deduction for development' and can account for as much as 75% of the

cost of the developed plot.

On the other hand, if the residential plot is in an unauthorised private

residential layout, the percentage of `deduction for development' may be

far less. This is because in an un-authorized lay outs, usually no land will

be set apart for parks, play grounds and community facilities. Even if any

land is set apart, it is likely to be minimal. The roads and drains will also

be narrower, just adequate for movement of vehicles. The amount spent on

development work would also be comparatively less and minimal. Thus

the deduction on account of the two factors in respect of plots in

unauthorised layouts, would be only about 20% plus 20% in all 40% as

against 75% in regard to DDA plots.

The `deduction for development' with references to prices of plots in

authorised private residential layouts may range between 50% to 65%

depending upon the standards and quality of the layout. .......

If the acquired land is in a semi-developed urban area, and not an

undeveloped rural area, then the deduction for development may be as

much less, that is, as little as 25% to 40%, as some basic infrastructure

will already be available. (Note: The percentages mentioned above are

tentative standards and subject to proof to the contrary).

Therefore the deduction for the 'development factor' to be made with

reference to the price of a small plot in a developed lay out, to arrive at the

cost of undeveloped land, will be for more than the deduction with

reference to the price of a small plot in an unauthorized private lay out or

an industrial layout. ..........

19

Some of the layouts formed by statutory Development Authorities may

have large areas earmarked for water/sewage treatment plants, water

tanks, electrical sub-stations etc. in addition to the usual areas earmarked

for roads, drains, parks, playgrounds and community/civic amenities. The

purpose of the aforesaid examples is only to show that the `deduction for

development' factor is a variable percentage and the range of percentage

itself being very wide from 20% to 75%."

19. In this case, the evidence shows that plot nos.62 and 42 are sali

(agricultural) lands, and the plot no.272 is a beel (marshy) land. Their

extents are 1.94 acres, 0.61 acres and 0.22 acres respectively. Plot No.62

faces a twenty feet wide metalled road. Plot No.42 faces a twenty feet katcha

road. Plot No.272 faces a 60 feet road. All are situated within the limits of

Ward No.108 of Kolkata Municipal limits and had potential for being

developed into residential plots. They were acquired for East Calcutta Area

Development Project. According to the evidence of the Expert Valuer, plot

No.192 the sale price of which has furnished the basis for determination of

market value lies at a distance (in a straight line, as the crow flies) of 1272

ft. from plot No.62, a distance of 1750 ft. plot No.42 and a distance of 2200

ft. from plot No.272. The water supply lines and electrical lines were already

laid in the roads adjoining these plots. The appellants had submitted before

the Reference Court and High Court that the cut for development from the

market value of plot No.192 should be 33.33%. The Reference Court after

considering the facts found that 33.33% (one-third of the value of the small

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developed plot) should be deducted towards development/development cost,

to arrive at the value of the acquired lands. The High Court has not

interfered with the said percentage of deduction. In the circumstances, we

find no reason to alter the percentage of deduction of 33.33%.

Re : Contention (iv)

20. The market value has to be determined with reference to the date of

publication of the notification under section 4(1) of LA Act. Though the

lands were requisitioned in the year 1978 and possession was taken in

pursuance of such requisition in 1978-79 and 80% of estimated value was

given as advance under section 8B in pursuance of notification under section

4(1a) of WB Requisition Act, the said acquisition notification was not

followed by an award and the acquisition notification was allowed to lapse.

What is therefore relevant is the date of notification under section 4(1) of LA

Act in pursuance of which the acquisition was completed.

Therefore, the relevant date for determination of compensation would be the

date of publication of the preliminary notification under section 4(1) of the

LA Act. However in anticipation of acquisition the appellant/the Land

Acquisition Officer had made any payment to the land owner they will be

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entitled to credit therefor with interest at 15% per annum from the date of

payment to date of publication of preliminary notification. In his counter

affidavit filed in this Court, first respondent has alleged that the Collector

had paid ` 55,875/- for plot no.62 and ` 17,458/- for plot no.42. The

payment is said to be in 1979. Though solatium and additional amount will

be calculated on the entire compensation amount, statutory interest payable

to first respondent will be calculated only after adjusting the aforesaid

advance payment with interest therein towards the compensation amount.

Re : Relevant date for determining compensation

21. The notification under section 4(1) of the Act is dated 13.9.2000. It

was published in the gazette dated 13.9.2000. Thereafter it was published in

two newspapers. Lastly, the Collector caused public notice of the substance

of such notification to be given at convenient places in the locality on

16.11.2000. The reference court and the High Court have proceeded on the

basis that the relevant date for determining the market value is 16.11.2000.

They have also relied upon the expert valuer's report which assessed the

market value as on 16.11.2000. We have noticed above that the Expert

Valuer determined the market value with reference to a sale deed dated

10.3.2000, by adding 8% as the increase in prices for the period of eight

22

months between 10.3.2000 and 16.11.2000 (at the rate of 1% per month).

The question is whether the relevant date for determination of compensation

is 13.9.2000 or 16.11.2000.

22. Sub-section (1) of Section 23 provides the compensation to be

awarded shall be determined by the Reference Court, based upon the market

value of the acquired land at the time of publication of the notification under

section 4 sub-section (1). The first respondent contends that the `date of

publication of notification under section 4(1)' is statutorily defined in

section 4(1) (that is the last of the dates, out of the dates of publication of the

notification in the official gazette, publication of the notification in two daily

newspapers circulating in that locality of which at least one shall be in

regional language, and public notice of the substance of such notification

being given at convenient places in the locality), and therefore the said

words refer to 16.11.2000 as the date of publication of notification under

section 4(1) of the LA Act.

23. Section 6 was amended in 1984 providing that no declaration under

section 6 in respect of any land covered by a notification under section 4(1)

shall be made after the expiry of one year from the date of publication of the

23

notification under section 4(1). In that context, to avoid any confusion as to

what would be the date of publication of the notification under section 4(1),

section 4(1) was also amended to clarify the position and it was provided

that "the last of the dates of such publication and giving of such public

notice being herein referred to as the date of publication of the

notification". But the words `publication of the notification under section

4(1)' occurring in the first clause of section 23(1) have different meaning

and connotation from the use of the said words in sections 4(1) and 6 of the

LA Act. Prior to the 1984 amendment of section 4, the words "publication

of notification under section 4(1)" in section 23(1) referred to the date of

publication of the notification in the official Gazette. Even after the

amendment of section 4(1), the said words in section 23(1) continue to have

the same earlier meaning. We may briefly indicate the reasons for our said

conclusion.

24. One of the principles in regard to determination of market value under

section 23(1) is that the rise in market value after the publication of the

notification under section 4(1) of the Act should not be taken into account

for the purpose of determination of market value. If the deeming definition

of `publication of the notification' in the amended section 4(1) is imported

24

as the meaning of the said words in the first clause of section 23(1), it will

lead to anomalous results. Owners of the lands which are the subject matter

of the notification and neighbouring lands will come to know about the

proposed acquisition, on the date of publication in the gazette or in the

newspapers. If the giving of public notice of the substance of the notification

is delayed by two or three months, there may be several sale transactions in

regard to nearby lands in that period, showing a spurt or hike in value in

view of the development contemplated on account of the acquisition itself. If

the words `publication of the notification' in section 23(1) (clause firstly)

should be construed as referring to the last of the dates of publication and

public notice, and the date of public notice in the locality is to be considered

as the date of publication, the landowners can legitimately claim that the

sales which took place till the date of public notice should be taken into

account for the purpose of determination of compensation, leading to

disastrous results. Let us give two illustrations :

Illustration A : The market value of the acquired land on 13.9.2000 is

Rs.1,00,000 per acre. A notification under section 4(1) is published in the gazette

on 13.9.2000 and in two newspapers on 14.9.2000. But the public notice in the

locality is given only two months later on 16.11.2000. As the land owners in the

area come to know about the proposed acquisition and consequential expectations

of development in the area, developers and speculators enter the arena and start

buying neighbouring lands leading to steep increase in prices. Consequently

several sales takes place in October 2000 at rates ranging from Rs.1.5 lakhs to

Rs.2 lakhs per acre. If 16.11.2000 should be taken as the date of publication of the

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notification under section 4(1), the land owners can legitimately contend that the

sale deeds executed in October 2000, being prior to the `date of publication of the

preliminary notification' should be taken note of for the purpose of determining

the compensation. That would result in compensation being determined between

Rs.1,50,000 to Rs.2 lakhs per acre even though the market rate as on 13.9.2000

which is the date of publication of the notification was only Rs.1,00,000.

Illustration B : When large tracts of lands are acquired and the preliminary

notification dated 13.9.2000 is published in the Gazette on 13.9.2000 and in the

newspapers on 14.9.2000, but public notice of the substance is delayed by more

than two months and is given on 16.11.2000, there will be ample time for

unscrupulous land owners of acquired lands to create evidence of higher market

value by managing nominal sale/s in regard to some neighbouring land which is

not the subject of acquisition at a price of Rs.2,00,000/- as against the market price

of Rs.1,00,000/- and thereby cause a huge loss to the state.

25. The same words used in different parts of a statute should normally

bear the same meaning. But depending upon the context, the same words

used in different places of a statue may also have different meaning. [See:

Justice G.P. Singh's Principles of Statutory Interpretation - 12th Edition -

Pages 356-358]. The use of the words `publication of the notification' in

sections 4(1) and 6 on the one hand and in section 23(1) on the other, in the

LA Act, is a classic example, where the same words have different meanings

in different provisions of the same enactment. The words `publication of the

notification under section 4 sub-section (1), are used in section 23(1) for

fixing the relevant date for determination of market value. The words "the

last of the date of such publication and giving of such public notice being

hereinafter referred to as the publication of the date of notification" in

26 section 4(1) and the words `one year from the date of the publication of the

notification" in the first proviso to section 6, refer to the special deeming

definition of the said words, for determining the period of one year for

issuing the declaration under section 6, which is counted from the date of

`publication of the notification'. Therefore the context in which the words

are used in sections 4(1) and 6, and the context in which the same words are

used in section 23(1) are completely different. In section 23(1), the words

"the date of publication of the notification under section 4(1)" would refer

to the date of publication of the notification in the gazette. Therefore,

`13.9.2000' will be the relevant date for the purpose of determination of

compensation and not 16.11.2000.

Conclusion

26. In regard to plots 62 and 42, by adopting a cut of 33.33% from the

price of Rs.100,000/- disclosed with reference to the sale of sali plot no.192,

we determine the compensation as Rs.66,667/- rounded off to Rs.67,000/-

per cottah.

27. In regard to plot no.272, we find that beel land has been sold for

`70,000/- per cottah on 8.1.1999 and `80,000/- per cottah on 25.6.1999. We

may therefore, take `90,000/- per cottah as the market value of small

27

developed plots by providing a 12% appreciation per year with reference to

the sale price on 25.6.1999. By deducting 33.33% therefrom, the market

value of undeveloped plots in 2000 would be `60,000/- per cottah.

28. In view of the above, we allow these appeals in part and reduce the

compensation to ` 67,000/- per cottah for plot nos.62 and 42 and maintain

the compensation at the rate of ` 60,000/- per cottah in regard to plot

no.272. The first respondent will be entitled to the statutory benefits, that is,

solatium, additional amount and interest in accordance with the provisions

of the LA Act. The appellants will be entitled to adjust the advance payment

made with interest thereon at 15% PA from the date of such payments to

13.9.2000 towards the compensation payable. Parties to bear their

respective costs.

...............................J.

(R V Raveendran)

New Delhi; ...............................J.

September 2, 2011 (Markandey Katju)