BHIKULAL KEDARMAL GOENKA (D) BY L.RS. Vs. STATE OF MAHARASHTRA AND ANR

Supreme Court of India (Full Bench (FB)- Three Judge)

Appeal (Civil), 7219-20 of 2016, Judgment Date: Jul 28, 2016

                         IN THE SUPREME COURT OF INDIA

                         CIVIL APPELLATE JURISDICTION

                       CIVIL APPEAL Nos.7219-20 OF 2016
                 (Arising out of SLP(C)Nos.24895-24896 of 2013)


BHIKULAL KEDARMAL GOENKA (D) BY L.RS.             .......APPELLANTS



                                   VERSUS


STATE OF MAHARASHTRA AND ANR                     .......RESPONDENTS


                                  O R D E R

            Leave granted.

            Two pieces of  the  appellant's  (since  deceased.  and  is  now
represented by his legal  representatives)  land  measuring  2250  and  5034
sq.meters were sought to be compulsorily acquired, vide Notifications  dated
30.10.1986 and 13.11.1986 respectively, issued under Section 6 of  the  Land
Acquisition Act, 1894 (hereinafter referred to as `the  Act').   Admittedly,
the purpose for which the land was acquired was to raise a structure  for  a
primary school and to  provide  playgrounds  therefor.   Vide  awards  dated
31.08.1987 and 09.11.1987, the Special Land Acquisition  Officer  determined
the market value of the  land  measuring  2250  sq.meters  at  Rs.110/-  per
sq.meter.  For  the  land  measuring  5034  sq.meters,  the   Special   Land
Acquisition Officer bifurcated the same. For the land  adjoining  the  road,
he awarded Rs.140/- per sq.meter, and for the remaining land  situated  away
from  the  road,  he  awarded  Rs.110/-  per   sq.meter.    In   the   above
determination, the acquired land was divided into 18  plots,  out  of  which
six were awarded compensation at the rate of Rs.140/- per sq.meter, and  the
remaining at the rate of Rs.110/- per sq.meter.
            Dissatisfied with the  determination  rendered  by  the  Special
Land Acquisition Officer, the appellants preferred reference  under  Section
18 of the Act seeking enhancement of the market  value  of  the  land.   The
Reference Court, by a common order dated 25.01.1996, determined  the  market
value of the acquired land at the rate of Rs.140/- per  sq.meter.   However,
for adjusting the value representing large areas of the plot, the  Reference
Court considered it appropriate to make a deduction of 1/3rd from the  total
amount calculated.
             Still  not  satisfied  with  the  compensation   awarded,   the
appellant approached the High Court of Judicature at Bombay  (Nagpur  Bench,
Nagpur)(hereinafter referred to as `the High  Court')  by  preferring  First
Appeal Nos.638 and 639 of 1996. The same came  to  be  disposed  of  by  the
impugned order  dated  15.10.2012.  The  High  Court,  after  examining  the
evidence recorded before the Reference Court,  arrived  at  the  conclusion,
that the lands acquired were situated within the  heart  of  the  town,  and
were surrounded by residential houses, commercial complexes etc.  and  major
part of the area adjoined the Akola-Akot Road.  It is  therefore,  that  the
High Court determined the market value at Rs.200/-  per  sq.meter.  However,
the High Court directed deduction at the rate of 1/3rd  towards  development
charges and thereupon, arrived at the  conclusion,  that  the  market  value
payable ought to have been at the rate of Rs.133/- per  sq.meter.  The  High
Court rounded the rate determined, by awarding the appellants  Rs.135/-  per
sq.meter.
            It was the vehement contention of the learned  counsel  for  the
appellants, that there was no justification whatsoever,  for  recording  any
deduction, specially when there was no question of any internal or  external
development, and as such, expenses of  such  developments  should  not  have
been taken into consideration so as to grant a deduction  of  1/3rd  of  the
amount.  In order to substantiate his above contention, learned counsel  for
the appellants has referred to the decision in Sabhia Mohammed  Yusuf  Abdul
Hamid Mulla (Dead) by Lrs. and others vs. Special Land  Acquisition  Officer
and others, (2012) 7 SCC  595,  and  placed  reliance  on  the  observations
recorded in para 19 thereof. Having given our  thoughtful  consideration  to
the position expressed in paragraph 19, it is apparent,  that  while  fixing
the market  value  of  the  acquired  land,  which  may  be  undeveloped  or
underdeveloped, the courts have approved deduction of 1/3rd  of  the  market
value towards development cost, “except when”, no  development  is  required
to be made for implementation of  the  public  purpose  for  which  land  is
acquired. Admittedly, the public purpose in the instant case is to  raise  a
school and to provide for play-grounds, for the students to be  enrolled  in
the school.

            The factual position, we are satisfied  is,  that  the  land  in
question is located within the heart of the city, as is the  case  projected
at the hands of the learned counsel for the appellants.  The  acquired  land
is to be used for raising a school building,  and  to  provide  play-grounds
therewith. There would hardly be any requirement  for  development  charges,
in the peculiar facts of this case.  We are therefore  satisfied,  that  the
deduction  of  1/3rd  amount,  expressed  by  the  High  Court,  was  wholly
unjustified.
            However, we are unable to accept the determination of  the  High
Court, that the compensation to be awarded to the appellants  should  be  at
the rate of Rs.200/- per sq.meter. The exemplar land, on the basis of  which
the appellants desired the determination of market price,  itself  was  sold
at the rate of Rs.161/- per sq.meter (total area 105.90  sq.meters  sold  at
the rate of Rs.17,000/- vide sale deed dated 02.05.1986). The  area  of  the
exemplar land was rather small, in comparison to the  acquired  land.  There
is therefore no justification on facts, for the acquired  land  being  given
land  value  more  than  the  exemplar  land.  For  the   reasons   recorded
hereinabove, we consider it just and appropriate  to  determine  the  market
value of the acquired land at the rate of Rs.161/- per  sq.meter  i.e.,  the
same as the exemplar land. Ordered accordingly.
            The appeals are allowed in the above terms.
            The appellants shall  also  be  entitled  to  all  consequential
statutory benefits. Since the acquisition of the  appellants'  land  relates
to the year 1986-87, we consider it  just  and  appropriate  to  direct  the
respondents to disburse the compensation payable to the land loser i.e.  the
appellants herein within  three  months  from  the  date  of  receipt  of  a
certified copy of this order.

                                                ..........................J.
                                                  (JAGDISH SINGH KHEHAR)


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

                                                       (KURIAN JOSEPH)


                                                ..........................J.
                                                        (ARUN MISHRA)

NEW DELHI;
JULY 28, 2016.