separately. If the land value had been determined with reference to the sale statistics or compensation awarded for
a nearby vacant land, then necessarily, the trees will have to be valued separately. But if the value of the land has
been determined on the basis of the sale statistics or compensation awarded for an orchard, that is land with
fruit-bearing trees, then there is no question of again adding the value of the trees. Further, if the market value
has been determined by capitalizing the income with reference to yield, then also the question of making any addition either for the land or for the trees separately does not arise. In this case, the determination of market value
was not with reference to the yield. Nor was the determination of market value in regard to the land with reference to the value of any orchard but was with reference to vacant agricultural land. In the circumstances, the value of the trees could be added to the value of the land. "
Bombay High Court
C vs H on 6 August, 2013
Bench: A.P. Bhangale
1) State of Maharashtra, through Collector,...VERSUS...
RESPONDENTS :- 1) Gopikisan S/o Hemraj Biyani, 1
Citation;2013(5) ALL M R793
(i) At the rate of Rs 20,000/- per hector for 3.57 Hector. C
(ii) Rs.7,250/- per hector for 0.80 R land. (iii) At the rate of Rs.200/- per hector for 0.20 R land. h
iv) Rs.5,75,000/- for the standing orange trees (1150x500) ig
together with the statutory benefits. H
2) It is submitted on behalf of the Appellants State that the enhancement of the compensation was contrary to law without y
adequate and reliable evidence. Sole instance of Survey No.96 (2) ba
dated 16-04-1979 was wrongly held as comparable sale instance. om
3) On the other hand, it is argued on behalf of the respondents that the compensation was assessed at lower rate and the reference Court ought to heave considered the sale instances B
which were post notification after 4/5 months from the date of notification. Such sale instances cannot be brushed aside by the reference Court. Value of the land ought to have been assessed at Rs.25,000/- per hector. The assessment of the compensation for ::: Downloaded on - 07/08/2013 19:23:52 ::: 4 fa456,444.98 Judgment
the Orange trees was very low. It ought to have been Rs.600/- rt
per Orange tree instead of Rs.500/- per tree. Learned Advocate ou
for the respondents prayed for the modification in respect of the compensation. Learned Advocate for respondents also C
prayed for the enhancement of the compensation for farm house @ Rs.20,000/- and well, pipeline and the electric motor pump on h
the well. It is submitted that the sale indexes at Exhibit-113 and ig
114 were not appreciated.
H
4) What is required to be considered by the Court is the market value of the land on the date of publication of the y
notification under Section 4 of the Land acquisition Act and the ba
damage sustained by the persons interested by reason of the standing crops or trees which may include fruit bearing trees be om
on the land at the time the Collector's taking possession thereof or any other damage proved by the persons interested as has been caused due to the Collector's taking possession of the land. The B
burden to prove the market value of acquired property is on the State, but the burden to prove that the claimant is entitled to the enhanced compensation is on the claimant. The market value is the 'price a willing purchaser would pay to a willing seller having ::: Downloaded on - 07/08/2013 19:23:52 ::: 5 fa456,444.98 Judgment
due regard to its existing condition with all its existing advantages rt
and its potential possibilities when laid down in the most ou
advantageous manner'. Potentiality as on the date of the notification under Section 4(1) can be considered. Oral evidence C
as to the market value is not acceptable. In order to establish the case for the enhancement, the claimant must be able to show that h
the comparable Sale instance was within reasonable time before ig
the notification issued under section 4(1) and it was a bona fide transaction in respect of the Sale of the adjacent land possessing H
similar advantages, having similar potentiality and nature. In exceptional case Sale of small properties may be relied upon to y
determine the market value of large plots, but when such ba
comparable Sale instance is to be acted upon the certain deductions which may normally range between 33% to 50% are om
required to be made towards development of the area. Guesstimates of the plus and minus points of comparable sales are needed. Plus points are small size, frontage to road, proximity to B
developed area, regular shape, even land and other special advantages are plus points. Large size, remoteness from the road, and undeveloped area, irregular shape, uneven levels etc. are minus points. The question that arises is as to whether the ::: Downloaded on - 07/08/2013 19:23:52 ::: 6 fa456,444.98 Judgment
reference Court was in error to rely upon Sale indexes Exhibit-113 rt
and 114 though admissibility thereof was rejected by the reference ou
Court while determining the compensation to fix compensation without any cogent and reliable evidence. C
5) Subject matter is the reference for the irrigable agricultural land survey No.91 with an area of H.04.57 R. having h
one well fitted with electric motor pump and pipeline with ig
standing 1150 fruit bearing orange trees Notification under H
Section 4 was issued on 10/12/1981. Sale instances pointed out were dated 19/05/1982 and 22/04/1982 (Exhibit 113 and 114) y
much after the notification under Section 4 of the Act. The sale ba
instances were not from Dapori village hence could not have been considered. But the agricultural land herein has perennial source om
of water from one well in the land. 6) The question that arises is as to whether the reference B
Court was in error to rely upon Sale indexes Exhibit 113 and 114 though admissibility thereof was rejected by the reference Court while determining the compensation to fix compensation without any cogent and reliable evidence and further, whether it erred to ::: Downloaded on - 07/08/2013 19:23:52 ::: 7 fa456,444.98 Judgment
grant lump sum compensation for the damage resulting to the rt
standing orange trees standing on the acquired land? The answer ou
must be in negative for the following reasons. C
7) The Reference Court in the course of the judgment observed that the Sale indexes were in respect of the sale deeds h
executed much after the date of the notification under Section 4 of ig
the Land Acquisition Act and were in respect of the lands situated at villages Mauza Umarkhed and Mauza Ghoddeo Khurd H
respectively while land acquired is situated at Dapori village. There was no evidence about the distance between the acquired y
land at village Dapori and the lands in respect of which the sale ba
indexes of the lands sought were to be relied upon. While granting compensation for the acquired land on the basis of the om
market price in this case the method adopted by the Land Acquisition Officer is referred to in the impugned judgment and order. Land Acquisition Officer had placed the land acquired in B
category No. 4. L.A.O. then considered nine Sale instances for the year preceding the notification under Section 4. Sale data was obtained from the Agricultural Produce Market Committee, Morshi. After considering and comparing the Sale instances, the ::: Downloaded on - 07/08/2013 19:23:53 ::: 8 fa456,444.98 Judgment
L.A.O. arrived at the conclusion as to the market price of the dry rt
crop agricultural land in the area was Rs.8,500/- per hector. Since ou
the acquired land to the extent of H. 3.37 R. was perennially irrigated land with a well, L.A.O. granted compensation at the rate C
of Rs.17,000/- per hector which was at the rate double than for the dry crop land. This method to arrive at the market price was h
reasonable and permissible. L.A.O. had also considered the ig
acquired land as the best amongst the lot on the basis of the rate of assessment indicating the fertility of the soil. L.A.O. also noted H
the existence of the well which was perennial source of water. Claimant had deposed that there was yearly lucrative income from y
the land. This evidence remained un-rebutted from the side of the ba
State. The land is situated in the orange growing belt and because of the agro-climatic condition the land in the area commands om
more value than the land raising Kharip crops only. There is increasing trend in prices of the land in this area. L.A.O. had not considered it fully to justify the award limited to sum of B
Rs.17,000/- per hector only. He did not come forward to depose before the reference Court to justify his Award. Sale indexes of the four transactions of 1979 were brought to the notice of the reference Court. Of those two instances were Field ::: Downloaded on - 07/08/2013 19:23:53 ::: 9 fa456,444.98 Judgment
Survey No.96/2, H.1.16 R. was sold for Rs.20,000/-. Field Survey rt
No.12/1 area H.1.62 R. was sold for Rs.15,000/- on 24/12/1979, ou
in the area. These Sale instances were two years prior to the date of notification under Section 4 of the Act. Thus, on this basis since C
the market value of the land in the vicinity was approx about Rs.18,000/- per hector, that too prior to two years of notification h
under Section 4 of the Act, the reference court considered the ig
acquired land as irrigated land, advantageous, H.3.57 R. perennially irrigated, 0.80 R. cultivable but fallow land and Pot H
Kharab land 0.20 R were differently assessed for the market value thereof. The market value of the acquired land H.3.57 R. was y
assessed on the basis that it was perennially irrigated land, and a ba
well included. Separate compensation was not awarded for the cattle shed as it was easily removable and capable of being taken om
away. The reference Court awarded enhanced compensation for standing Orange trees on the land at the rate of Rs.500/- per Orange tree without using any multiplier after considering the B
evidence of the expert horticulturist as there was no dispute regarding the number of Orange trees situated on the land. As permission was sought by the land owner to cut the other trees like Bor, Jambhul etc. for fuel and wood, the other trees were not ::: Downloaded on - 07/08/2013 19:23:53 ::: 10 fa456,444.98 Judgment
valued for the purpose of computation of amount of compensation rt
a large number of factors have to be taken into consideration, ou
namely, nature and quality of land, whether irrigated or un- irrigated, facilities for irrigation like existence of well, etc. , the C
location of the land, closeness to any road or highway, the evenness thereof whether there exists any building or structure. In h
Navanath and others v. State of Maharashtra, reported in ig
(2009) 14 SCC 480, at paragraph 40, the Hon'ble Supreme Court has held as follows :
H
"40. Indisputably, valuation of agricultural land on the one hand and valuation of orchard and forest on the other would stand on different footings. Whereas in the y
former case, the known legal principles, particularly with ba
reference to the exemplars will have to be applied, in the latter a different principle, namely, multiplier of eight or om
ten, as the case may be, on the basis of the multiplicand, namely, yield from the trees or plantation would be applicable"
B
8) LAO had not considered the presence of fruit-bearing trees on the land for separate valuation on multiplier basis. It is true that the compensation cannot be granted both for the loss of the irrigated land as well as for the capitalization of income of the fruit-bearing orange trees. ::: Downloaded on - 07/08/2013 19:23:53 ::: 11 fa456,444.98 Judgment
The trees standing on the land acquired are things 'attached to the rt
earth and hence they are included in the definition of land in ou
section 3(a)' and that definition must apply in construing section 23 of the Act. It is true that the value of the trees as are standing C
on the land when the declaration is made under section 6 must be included in the market value of the land on which the allowance h
of 15% should be given under section 23(2) of the Act. No doubt, ig
accepting the average yielding life of the Orange trees and capitalizing the same by appropriate multiplier is fair method and H
good estimate of the market price of the Orange trees. But when in the case in hand, the amount of Compensation for damage to y
the 1150 standing orange trees was considered and Rs.500/- per ba
tree = Rs.5,75,000/- was lump sum compensation valued and added to the estimated market value of the land acquired by the om
reference Court based on expert opinion and in the facts and circumstances of the case. Question of applying the 8 or 10 years multiplier did not arise as the guesstimated compensation for the B
market value of the land acquired was already arrived at. In the case in hand, the reference Court in the course of the judgment observed that the Sale indexes were in respect of the Sale deeds executed much after the date of the notification under Section 4 of ::: Downloaded on - 07/08/2013 19:23:53 ::: 12 fa456,444.98 Judgment
the Land Acquisition Act and were in respect of the lands situated rt
at villages Mauza Umarkhed and Mauza Ghoddeo Khurd ou
respectively while the land acquired is situated at Dapori village. There was no evidence about the distance between the acquired C
land at village Dapori and the lands in respect of which the sale indexes of the lands sought were to be relied upon. While granting h
compensation for the acquired land on the basis of the Market ig
price in this case, the method adopted by the Land Acquisition Officer is referred to in the impugned judgment and order. L.A.O. H
had placed the land acquired in category No.4. L.A.O. then considered nine Sale instances for the year preceding the y
notification under Section 4. Sale data was obtained from the ba
Agricultural Produce Market Committee, Morshi. After considering and comparing the Sale instances, the L.A.O. arrived at the om
conclusion as to the market price of the dry crop agricultural land in the area was Rs.8,500/- per hector. Since the acquired land to the extent of H.3.37 R. was perennially irrigated land L.A.O. B
granted compensation at the rate of Rs.17,000/- per hector, which was at the rate double than for the dry crop land. This method to arrive at the market price was no doubt permissible . L.A.O. had also considered the acquired land as the best amongst the lot on ::: Downloaded on - 07/08/2013 19:23:53 ::: 13 fa456,444.98 Judgment
the basis of the rate of assessment indicating the fertility of the rt
soil. L.A.O. also noted the existence of the well which was ou
perennial source of water for the land. Claimant had deposed that there was yearly lucrative income from the land. The evidence C
remained un-rebutted from the side of the State. But in addition, the fact is that the land in question is situated in the Orange h
growing belt(Track) and because of the agro-climatic condition ig
the land in the area commands more value than the land raising Kharip and Rabi crops only. There is increasing trend in prices of H
the lands in this area. L.A.O. did not consider this fact fully to justify the award limited to sum of Rs.17,000/- per hector only. y
He did not come forward to depose before the reference Court to ba
justify his Award. Sale indexes of the four transactions of 1979 were brought to the notice of the reference Court. Of those two om
instances were Field Survey No.96/2, H.1.16 R. was sold for Rs. 20,000/-. Field Survey No.12/1 area H.1.62 R. was sold for Rs. 15,000/- on 24/12/1979, in the area. These Sale instances were B
two years prior to the date of notification under Section 4 of the Act. Thus, on this basis since the market value of the land in the vicinity was about Rs.18,000/- per hector, that too prior to two years prior to the notification under Section 4 of the Act, the ::: Downloaded on - 07/08/2013 19:23:53 ::: 14 fa456,444.98 Judgment
reference Court considered the acquired land as irrigated land, of rt
which advantageous, H.3.57 R. was perennially irrigated, 0.80 R. ou
cultivable but fallow land and Pot Kharab land 0.20 R. were differently assessed for computing the market value thereof. Since C
the market value of the acquired land H.3.57 R. was assessed on the basis that it was perennially irrigated land, and Well included, h
separate compensation was not awarded for the cattle shed as it ig
was easily removable shed and capable of being taken away. The reference Court in the facts mentioned justifiably awarded H
enhanced lump sum compensation for 1150 standing Orange trees on the land at the rate of Rs.500/- per Orange tree, rightly y
without adopting capitalizing method or using multiplier method ba
after considering the evidence of the expert horticulturist as there was no dispute regarding the number of Orange trees standing on om
the land and compensation for irrigable land was already considered. As permission was sought by the land owner to cut the other trees like Bor, Jambhul etc. for fuel and wood, the other B
trees were not computed for to be valued. Since compensation for the land was assessed considering it as perennially irrigated land sourced by water from the well, separate compensation for the 1150 standing orange trees could not have been computed by the ::: Downloaded on - 07/08/2013 19:23:53 ::: 15 fa456,444.98 Judgment
usual capitalizing by multiplier method. Lump sum compensation rt
was granted as allowable in the facts and circumstances of this ou
case for the assumption that damage was bound to result to the standing Orange trees when possession of land was taken by the C
Collector. Since the wisdom of overall compensation awarded by the reference Court appears assured just and fair returns to the h
owner of the acquired land, no further enhancement to it or ig
reduction from it is necessary.
H
9) The learned Advocate for respondents- claimants relied upon the ruling in Trishala Jain & Anr. v. State y
of Uttaranchal & Anr., reported in AIR 2011 SC 2458, it is held ba
that-
"'Guess' as understood in its common paralance is an om
estimate without any specific information while calculations' are always made with reference to specific data. 'Guesstimate' is an estimate based on a mixture of guesswork and calculations and it is a process in itself. At B
the same time 'guess' cannot be treated synonymous to 'conjecture'. 'Guess' by itself may be a statement or result based on unknown factors while 'conjecture' is made with a very slight amount of knowledge, which is just sufficient to incline the scale of probability. "Guesstimate' is with higher certainty than mere 'guess' or a 'conjecture' per se. The ::: Downloaded on - 07/08/2013 19:23:53 ::: 16 fa456,444.98 Judgment
guesswork has to be used for determination of rt
compensation with greater element of caution and the principle of guesstimation will have no application to the ou
case of 'no evidence'. This principle is only intended to bridge the gap between the calculated compensation and C
actual compensation that the claimants may be entitled to receive as per the facts of a given case to meet the ends of justice. Certain principles controlling the application of h
'guesstimate' are:
(a) Wherever the evidence produced by the ig
parties is not sufficient to determine the compensation with exactitude, this principle can be resorted to. H
(b) Discretion of the Court in applying guesswork to the facts of a given case is not unfettered but y
has to be reasonable and should have a connection to the data on record produced by the parties by way of evidence. ba
Further, this entire exercise has to be within the limitations specified under Sections 23 and 24 of the Act and cannot om
be made in detriment thereto.
It is also held that application of above principles are the base for determination of compensation payable to the claimants. B
A reference is also made to the ruling in Special Land Acquisition Officer v. Karigowda & Ors.,reported in AIR 2010 SC 2322, wherein it is held that determination of relevant considerations in respect of agricultural lands, manufacturing or commercial activity ::: Downloaded on - 07/08/2013 19:23:53 ::: 17 fa456,444.98 Judgment
carried on by agriculturist, either himself or through third party, rt
as a continuation of the agricultural activity, that is, using the ou
yield for production of some other final produce, cannot be basis for determining fair market value of acquired land and the interest C
on compensation can be awarded with effect from date of taking possession and not from date of notification. A reference is also h
made to the ruling in State of U.P. v. Major Jitendra Kumar and ig
others, reported in AIR 1982 SC 876, wherein it is held that where land was acquired for the benefit of the Co-operative H
Housing Society under a Notification issued under Section 4 and in appeal by the claimant for enhancement of compensation the y
High Court relied upon a sale deed where under the Co-operative ba
Society had itself purchased land in the neighbourhood of the land for which enhancement of compensation was claimed, the High om
Court could not be said to have committed any error by relying upon the sale deed even though the sale deed was of a date three years later than the Notification under Section 4 when no material B
was produced before the Court to suggest that there was any fluctuation in the market rate from 1948 onwards till 1951 and if so to what extent. The ruling cited in Chindha Vithal Sonawane v. Special Land Acquisition Officer, reported in 1975 Mh.L.J. ::: Downloaded on - 07/08/2013 19:23:53 ::: 18 fa456,444.98 Judgment
468, it is held that benefit of simultaneous independent rt
acquisition of adjacent land cannot be denied, but allowance ou
should be made for benefit of its own acquisition and post notification sales are not irrelevant and cannot be discarded C
merely because they are effected two or three years after relevant date. The ruling referred in Kashinath Atmaram Kothavade v. h
State of Maharashtra, reported in 1992 Mh.L.J. 987, it is held ig
that determination of compensation on the basis of sale instances of similar lands, which assisted in determining market rate and H
provided a good basis for deciding compensation in respect of similar lands. A reference is also made to the ruling in Osman y
Khan Abdul Majid Khan and another v. State of Maharashtra, ba
reported in 1994 Mh.L.J.1103, wherein it is held that fixing market value of a large property on the basis of sale instances of om
smaller property and the availability of evidence to show that adjoining area i.e. acquired land was already developed and hence B
principle of deduction of expenses required for development of large tract not applicable. It is held that price paid in sale or purchase of adjoining land within a reasonable time from the date of acquisition of land in question or about the time of notification under Section 4 would be the best piece of evidence. It is also ::: Downloaded on - 07/08/2013 19:23:53 ::: 19 fa456,444.98 Judgment
held that where notifications under Sections 4 and 6 were issued rt
on 21/01/1982 and 23/03/1982 and award was made on ou
23/02/1984, claimants entitled to interest on amount of compensation and benefit of higher solatium in view of Sections C
30(2) and 18 of the Land Acquisition (Amendment) Act. h
10) In Ambya Kalya Mhatre through L.R.s and others vs. ig
State of Maharashtra, reported in (2011) 9 SCC 325, Hon'ble Supreme Court expressed its view in para 30 thus:- H
"30. It is relevant to notice the definition of land in section 3(a) of the Act. It provides that the expression 'land' includes benefits to arise out of land, and things attached y
to the earth or permanently fastened to anything attached ba
to the earth. Therefore when the Act refers to acquisition of `land', the reference is not only to land but also to land, om
building, trees and anything attached to the earth. In the absence of any restriction in section 18 of the Act, and the respective roles assigned by the Act to the Land Acquisition Collector and the Reference Court in the context of making B
a reference and determining the compensation, we are of the view that once the reference is made in regard to amount of compensation, the Reference Court will have complete jurisdiction to decide the compensation for the land, buildings and trees and other appurtenances. The Reference Court will also have the power to entertain any ::: Downloaded on - 07/08/2013 19:23:53 ::: 20 fa456,444.98 Judgment
application for increasing the compensation under rt
whatever head. The fact that the landowner had sought increase only in regard to the land in the application for ou
reference, will not come in the way of the landowner seeking increase even in regard to trees or structures, C
before the Reference Court".
In para 35 the Apex Court viewed the situation thus:- h
"35. We are afraid that the High Court has misread the said decision in regard of valuing the land and trees ig
separately. If the land value had been determined with reference to the sale statistics or compensation awarded for H
a nearby vacant land, then necessarily, the trees will have to be valued separately. But if the value of the land has y
been determined on the basis of the sale statistics or compensation awarded for an orchard, that is land with ba
fruit-bearing trees, then there is no question of again adding the value of the trees. Further, if the market value om
has been determined by capitalizing the income with reference to yield, then also the question of making any addition either for the land or for the trees separately does not arise. In this case, the determination of market value B
was not with reference to the yield. Nor was the determination of market value in regard to the land with reference to the value of any orchard but was with reference to vacant agricultural land. In the circumstances, the value of the trees could be added to the value of the land. "
::: Downloaded on - 07/08/2013 19:23:53 ::: 21 fa456,444.98 Judgment
11) I have considered the rulings cited in the light of rt
submissions at the bar. It was open for the Reference Court to ou
consider the compensation for the land as well as for the things attached to the land when increase is sought in respect of the sum C
of compensation for the land as well as the standing trees for which the certain amount was determined by the Land h
Acquisition Officer. Reference Court was well within its power to ig
consider the compensation for the irrigable land valued on the basis of Sale statistics in respect of the lands in the vicinity, as well H
as to value the standing Orange trees which were required to be valued separately.
y
ba
12) In my opinion, for the reasons stated above, the award recorded by the Reference Court was just and fair in the facts and om
circumstances of the case and no ground is made out for interference with the same .
B
13) In view of above position, the appeals must fail and are dismissed with costs.
JUDGE
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