CASE NO.:
Special Leave Petition (civil) 4021 of 1995
PETITIONER:
KUMMARI VEERAIAH AND ORS.
RESPONDENT:
STATE OF ANDHRA PRADESH
DATE OF JUDGMENT: 28/02/1995
BENCH:
K. RAMASWAMY & B.L. HANSARIA
JUDGMENT:
1995 (1) SCR 379
The following Order of the Court was delivered :
This petition arises from the judgment and decree of the High Court of
Andhra Pradesh dated December 20, 1993, in Appeal No, 2698/87 and the
counter appeal filed by the State. The land to the extent of 69 acres and
25 gunthas situated in Bhongir municipality in Nalgonda district of Andhra
Pradesh, was acquired to provide house-sites. The notification under s.4(l)
of the Land Acquisition Act 1 of 1894 (for short, ‘the Act’) was published
in the district gazette, as amended by the local amendment on March 4,
1985. The possession thereof was taken on March 27, 1985 dispensing with
the inquiry under s.5-A. The Land Acquisition Officer (for short, ‘the
LAO’) in his award dated March 27, 1985, determined the compensation to the
lands varying between Rs. 6000 to Rs. 10,000 per acre. Though petitioners
claimed at the rate of Rs, 40 per sq. yd., on reference under s.18, the
Subordinate Judge, Bhongir, determined the compensation at Rs. 10 per sq.
yd., deducted Rs. 3 towards developmental expenditure, and fixed the market
value at Rs. 7 per sq. yd. Dissatisfied therewith, the petitioner as also
the State filed the appeals in the High Court.
The High Court after appreciation of documentary sale deeds and oral
evidence relied on by the petitioners held that fixation of compensation by
the reference court was fair and reasonable. Accordingly, dismissed both
the appeals of the claimants as well as the State.
Learned counsel, Sri Prakash Reddy, in his usual thorough preparation and
persuasive advocacy contended that though all the sale deeds are of small
extents, since the lands are situated within the municipal limits, the sale
transaction furnish the basis to determine the compensation as claimed at
Rs. 40 per sq. yd. and they cannot be rejected as being of small extents.
He placed strong reliance on Ex A-2, sale deed relating to the land in
question dated February 12,1985 and sale deeds, Ex,A-9, A-11 and A-17 etc.,
relating to the lands in the neighborhood. The High Court after
consideration of the entire evidence held thus :
“Ex.A-2, which was strongly relied on by Sri Pratap Reddy, is dated
12.2.1985 in respect of 400 sq. yds. situated in one of the acquired survey
numbers. The sale consideration is Rs. 16,000 and it works out to Rs. 40
per sq, yd. It was pointed out by Sri Krishna Koundinya that the vendor of
the land covered by ExA-2 is none else than the 5th claimant and the sale
was on 12.2.85, which was just a few days prior to the publication of the
notification under s.4(l) of the Act on 4.3,85. Therefore, the said sale
cannot form the basis for fixing the market value of a large extent of the
land in question. Ex,A-4, which is a sale deed dated 13.12.82, is in
respect of a very small extent of 140 sq. yds. of land sold for Rs. 7,000.
Neither the vendor nor the vendee has been examined. Ex.A-5 sale deed
covers an extent of 700 sq. yds. sold for Rs. 15,000. The sale transaction
took place on 23.2,85, which was a few days prior to the notification.
Ex.A-6 relates to the land situated in S.No. 1063 and the sale was on
28.2.85 just prior to the notification. Ex.A-7 relates to a small extent of
167 sq. yds. of land situated in S. Nos. 121 and 123 and pertains to Ward
No. 1 in Hasnabad area. Exs. A-9 to A-ll relate S. Nos. 1041, 1075 and 1056
and they do not form part of the survey numbers of the acquired land and
are situated in Hasnabad area and they too do not provide any useful
guidelines for fixing the market value of the lands in question, Exs. A-13
and A-14 also relate to the sale of small extents of lands in Kisan Nagar
and there is no evidence to show the distance between Kisan Nagar and the
acquired lands. An extent of 35 sq. yds. was sold under Ex. A-17 and the
sale was on 13.3,85, just prior to the notification. The sale included a
small extent of 35 sq. yds, with basement for Rs. 40,000 and it is not
possible to rely on this document, as there is nothing to show as to the
value of the basement. The sales of lands in Gunj area under Ex.A-8 a small
extent of 300 sq. yrd. situated behind the club under and a small extent of
300 sq. yds. situated behind the club under Ex.A-11, cannot form the basis
for fixing the market value of a large extent of land situated far away
from the said plots. Ex.A-15 is the judgment in OP No, 218/83 dated 19.4.84
relating to survey number 137 situated in Hasnabad. Ex.A-16 is the award
dated 14.8.82 and it relates to survey Nos. 97 and 100, These documents are
of no help in arriving at the market value of the acquired lands. We have
examined the documents produced by the claimants. Most of the sales covered
by the said documents are effected a few days prior to the notification
under s.4(l) of the Act, and they relate to small extents. Applying the
‘minus factors’ mentioned in the decision of the Supreme Court referred to
above, the largeness of the area under acquisition has to be considered as
a ‘minus factor’. The land acquired is a large extent of 69 acres and 25
guntas. The original claimants are sk in number. It will not be possible
for the claimants to find purchaser if such a large extent of land situated
in town, even if they are made into plots and sold. The entire land is at a
distance from the road without proper approach roads. The land is uneven
and requires filling-up. It is also remote from the developed localities
like Gunj and market place. The acquired land cannot be compared to small
bits of land situated near the Gunj and behind the club as evidenced by
Exs,A-8, A-ll and A-17, The sites covered by Exs. A-15 and A-16 are near
business localities and the entire land is contiguous to Ambedkar Nagar and
Sriram Nagar, which are slum areas, and cannot fetch the same value covered
by the sale deeds produced by the claimants. Excepting ExA-2, no other sale
deeds covering the lands adjacent to the acquired lands, are produced. As
observed earlier, under Ex.A-2 the vendor is claimant No, 5, and as such,
no reliance can be placed on the said document”.
On the basis of the above consideration and finding it was concluded that
the sale deeds do not reflect the true and correct market value and the
compensation determined by the Subordinate Judge, therefore, was found to
be proper and reasonable.
It is true that the certified copies of the sale deeds are admissible in
evidence as secondary evidence under s.51A of the Act since owners would be
reluctant to part with their original sale-deeds. But unless either the
vendor or the vendee has been examined as witness to testify not only the
consideration paid but also their specific knowledge and the circumstances
in which the sale deed came to be executed nearness to the lands etc., the
sale deeds cannot be relied on to determine market value of the acquired
lands. The true nature and situation of the respective lands are relevant
and germane as comparable sales for determination of the compensation and
are required to be brought on record through admissible evidence and tested
on the anvil of common experience. Therefore, by mere marking the documents
Exs. A-3, A-4, A-8 and A-10 by themselves do not amount to proof of the
afore-mentioned factors. The High Court rightly held that the documents
cannot be relied upon. The High Court is also right in its finding that
ExA-2 though relates to the same land, it was brought into existence just
few days prior to the date of the publication of the notification under
s.4(l) to boost up the prices and other similar documents also came to be
registered during the said period.
It is common knowledge and experience that the proposal for acquisition
take long time for arriving at a decision. In the mean time, it would be an
open cards and known to everyone, in particular, to the owners of the land
and persons in the neighborhood. Therefore, it is not uncommon to have sale
deeds executed and registered in the interregnum so as to boost the value
of the acquired lands. The High Court had, therefore, rightly excluded the
documents. It is true that Ex.A-4 was executed as early as December 19,
1982 for an extent of nearly 700 sq. yds. which considera-tion worked out
at Rs. 40 per sq. yd., but neither vendor nor vendee was examined. The
lands are situated at a distance of 1 k.m. Whether a willing buyer would
offer the same price when a large extent of land is offered for sale in an
open market on a free bargain, either in one lot or different lots, in
comparison with small piece or pieces of land? The answer obviously is no.
It is then contended that suitable deduction may be made to the value
determined on the basis of Ex.A-4 and compensation be determined on that
basis. We find the application of that principle also would be fraught with
injustice and needless burden on the State exchequer. First, it is to be
ascertained whether the document is a genuine document. If it is found to
be so it is required to be examined under what circumstances the document
came to be executed and the special advantageous feature for which the sale
came to be made. Whether the land under acquisition possess the same
special advantages? In case it is found that the documents are genuine and
the acquired land possessed of the same or similar special advantageous
features, then reasonable price is required to be determined by giving
suitable deduction depending upon the extent of land covered by the sale
transaction and the acquired land. When a large extent of land is available
for house sites and commands market for sale in bits, then a prudent owner
as a part of normal human conduct, he would get a layout prepared and
sanction obtained from the competent authority and would offer the plots
for sale. Similarly, it must be shown that land is situated in a developing
area etc. When such evidence is adduced, it is required to be considered on
the touchstone of potentiality of the land, human conduct and
probabilities. If the court finds that the land possessed those
potentialities and could be purchased as house site, then only suitable
deduction need to be made considering the relative extent of the land
covered by the sale/sales and the land under acquisition. True market value
is required to be determined, then it must not be on feats of imagination.
Since such evidence was not brought on record, the evidence of sale
transactions render little assistance to determine market value of the
acquired lands. Moreover, the two colonies are in slum area. So, but for
the acquisition, there would be no scope for development.
It being a pure appreciation of evidence-on-record, we do not find any
error of law committed by the Subordinate Judge or the High Court in not
relying upon sale deeds. It is next contended that the witness has stated
that the land purchased under Ex.A-14 is by the side of the acquired land
and the Subordinate Judge and High Court were not right in their conclusion
that the witness did not mention the nearness of the land. So, the error is
required to be corrected. It is true that the witness has stated that the
lands are nearer to the land under acquisition. But the witness has not
specifically stated the distance between the two lands as pointed out by
the Subordinate Judge and the High Court, It also being a fact based on
appreciation of evidence, we find no error of law in that behalf. The High
Court, therefore, was right in confirming the determination of the
compensation by the” subordinate court. As seen the LAO had determined the
compensation at the rates ranging between Rs. 6,000 to Rs. 10,000 per acre.
The subordinate judge has increased to Rs. 7 per sq. yd. In other words,
nearly Rs. 34,000 per acre.
In that fact-situation, determination of the compensation by the High Court
or Subordinate judge cannot be held to be illegal or arbitrary warranting
interference. The petition is accordingly dismissed