IN THE HIGH COURT OF BOMBAY
Decided On: 27.08.2009
Appellants: The State of Maharashtra through the Special Land Acquisition Officer National Highway Project
Vs.
Respondent: Damu Shankar Gorade and Smt. Sitabai Shankar Gorade
[Alongwith First Appeal Nos. 359, 360 and 361 of 1999, Civil Application Nos. 4487, 4488 and 4489 of 2000 and Cross Objection Stamp Nos. 9971]
Vs.
Respondent: Damu Shankar Gorade and Smt. Sitabai Shankar Gorade
[Alongwith First Appeal Nos. 359, 360 and 361 of 1999, Civil Application Nos. 4487, 4488 and 4489 of 2000 and Cross Objection Stamp Nos. 9971]
Hon'ble Judges/Coram:
B.H. Marlapalle and S.J. Vazifdar, JJ.
Citation; 2009 (6) AIR BOMBAY R 2010
1. All these Appeals have been filed under Section 54 of the Land Acquisition Act, 1894 by the State Government against the common award dated 23/4/1997 passed by the Joint District Judge, Nashik in Land Reference Nos. 412, 413, 415 and 417 of 1989. In the first part of the award the Reference Court fixed the market value of the land acquired at Rs. 25,000/- per hectare and in the second part it awarded compensation for the fruit trees as well as for the well and structures. The claimants have filed Cross Objections in First Appeal Nos. 358, 360 and 361 of 1999 and claimed higher market value for the land as well as higher compensation for the fruit bearing trees. In his depositions before the Reference Court, Shri Somanth Damu Gorade the claimant in L.R. No. 413/1989 stated that in L.R. No. 402/1989 the claimant had received Rs. 25000/-per hectare as market value for the bagayat land and hence he claimed the very same market value on the basis of parity. However, during the course of the arguments it is not much in dispute between both the parties that the market rate awarded at Rs. 25,000/- per hectare has been confirmed by this Court in connected appeals and, therefore, the challenge in these appeals remains only in respect of the compensation awarded for the fruit bearing trees by the common award.
2. The Government of Maharashtra issued the notification under Section 4 of the Land Acquisition Act, 1894 (the Act for short) on 30/10/1980 for acquiring the land for construction of Nandur Madmeshwar Express Canal and the declaration under Section 6 was published on 2/7/1981 whereas the SLAO passed his award on 23/9/1986. The claimants accepted the award amount under protest and submitted an application under Section 18 of the Act for enhanced compensation. They claimed that the market rate of the acquired land was required to be fixed at Rs. 50,000/-for bagayat and Rs. 25,000/-for jirait as against the market rate awarded by the Land Acquisition Officer at Rs. 9500/-. So far as the fruit bearing trees are concerned the Reference Court in L.A.R. No. 413/89 fixed the compensation at Rs. 900/-per tree for 970 grape trees, Rs. 100/-per tree for 33 grape trees, Rs. 800/-per tree for 249 guava trees, Rs. 50/-per tree for 24 guava trees and Rs. 3000/-per tree for 25 mango tress. In L.A.R. No. 412/89 the Reference Court fixed the compensation at Rs. 750/-per tree for 200 grape trees, Rs. 3000/for one mango tree. In L.A.R. No. 415/89 the compensation for trees was fixed at Rs. 750/-per tree for 181 grape trees and Rs. 3000/-per tree for five mango trees. In L.A.R. No. 417/89 it was fixed at Rs. 750/-per tree for 181 grape trees. In L.A.R. No. 413/89 the compensation for the land was awarded at Rs. 33,500/-admeasuring 1 H. 34 R. whereas for all the fruit trees the compensation awarded came to Rs. 11,51,700/-. In L.A.R. No. 412/89 the compensation for the land was awarded at Rs. 16,750/-measuring 67 R. whereas for the fruit bearing trees the compensation amount granted was Rs. 1,53,000/-. In L.A.R. No. 415/89 the compensation for land admeasuring 66 R. was awarded at Rs. 6500/-, whereas for the bruit bearing trees the compensation awarded came to Rs. 1,50,750/-. In L.A.R. No. 417/89 the compensation for the land admeasuring 67 R. was at Rs. 16,750/-whereas for the fruit bearing trees compensation was awarded at Rs. 1,35,750/-.
3. It was submitted by the learned AGP that the method adopted for determining the compensation for the fruit bearing trees by the Reference Court is based on income capitalization method and the same cannot be adopted when the compensation for the land has been awarded by fixing the market value as Bagayat land (perennially irrigated). It was submitted that if the market value of the land is fixed on the basis that it is Bagayat land, the fruit bearing trees cannot be separately valued and compensation if at all has to be on the basis that it was firewood. In the alternative it was submitted that if the compensation for fruit bearing trees is calculated and awarded on the basis of income capitalization method, no compensation is required to be given for the land acquired and the claimants cannot have both the benefits. They must opt for one of them and it was fairly conceded before us that better of the two benefits could be allowed to be retained. It was further submitted that the valuation done in respect of the fruit bearing trees is also excessively high, it is unreasonable and unrealistic. If the Reference Court accepted the Government Valuers report (Deputy Director of Horticulture at Exhibit 14), the said report was required to be accepted in toto and not in bits and pieces. The learned AGP, therefore, submitted that even the compensation fixed for the fruit bearing trees even by following income capitalization method is excessive and is required to be slashed down and in no case there could be separate compensation granted for the land on which the fruit bearing trees were standing. In support of these arguments the learned AGP has placed reliance on the following decisions:
1. State of Haryana v. Gurcharan Singh MANU/SC/0019/1996 : 1995 Supp (2) SCC 6372. Land Acquisition Officer, A.P. v. Kamadana Ramkrishna Rao and Anr. MANU/SC/7077/2007 : (2007) 3 SCC 5263. Dy. Director, Land Acquisition v. Malla Atchinaidu and Ors. MANU/SC/0121/2006: (2006) 12 SCC 874. Kiran Tandon v. Allahabad Development Authority and Anr. MANU/SC/0272/2004: (2004) 10 SCC 7455. Special Land Acquisition Officer, Malaprabha Dam Project v. Madivalappa Basalingappa Melavanki MANU/SC/0782/1995 : (1995) 5 SCC 6706. Special Land Acquisition Officer, Devangere v. P. Veerabhadrappa and Ors. MANU/SC/0244/1984 : (1984) 2 SCC 120
She has also relied upon the following decisions of this Court:
1. Ramgonda Layappa Birajdar and Ors. v. Special Land Acquisition Officer No. 6, Sangli and Ors. MANU/MH/1291/2005 : 2006 (2) Mh.L.J. 4362. Special Land Acquisition Officer, M.I.W., Jalgaon v. Chindha Fakira Patil (deceased) Heirs Dharma Chindha Patil2007 (2) Mh.L.J. 130 3. State of Maharashtra v. Sahadu Aba Shete and Ors.2009 (1) ALL MR 186
As per the learned AGP, the possession of the land was taken over on 8/4/1987 and thus for about seven long years, the claimants had derived and enjoyed the income from the fruit bearing trees as per their own case and this period of seven years was required to be deducted from the life span of the trees while calculating compensation by the income capitalization method in Exh. 14. Mrs. Mulekar by referring to the depositions of PW 3 Shri Uttamrao Patil, the Private Expert Valuer examined by the claimants, submitted that if the said valuer had visited the acquired land on 15/10/1985 and noted that 970 grape trees were of 6 years of age and 273 Guava trees were of 9 years of age, it was clear that the grape trees were planted after the notification under Section 4 of the Act was issued on 30/10/1980 and, therefore, the land owner cannot claim compensation for the grape trees at least. She also made the said argument in respect of the acquired land and covered under L.R. Nos. 412, 415 and 417 of 1989 as PW 3 has stated that he had noticed in the said Gat number, 562 grape trees of 5 years of age which clearly implied that all these trees were planted after the notification under Section 4 of the Act was issued. She referred to Section 24 fifthly of the Act and submitted that these trees were planted to increase the value of the land and after the notification was issued under Section 4 of the Act, Section 24 -seventhly made it clear that the land owners were required to obtain the sanction from the Collector before undertaking such plantation of fruit bearing trees. The learned AGP, therefore, urged before us that the land owners were not entitled for any compensation in respect of the fruit bearing trees on the basis of income capitalization method when the market value of the land was fixed on the basis that it was a bagayat land.
4. Mr. Joshi, the learned Counsel for the claimants on the other hand, submitted that as per the scheme of Section 23 of the Act, the compensation to be awarded to the claimants is in different parts. Firstly it is the market value of the land and in addition, for the fruit bearing trees or structures thereon are required to be valued for payment of additional compensation by way of damages. As per Mr. Joshi in the instant case the Reference Court has awarded compensation for fruit bearing trees and structures by way of damages and, therefore, it does not call for any interference more so when the said valuation is based on the report of the State Government Valuer as well as private valuer PW 3 examined by the claimants. It was submitted that the valuation so made is not realistic and in fact it is on the lower side and, therefore, it requires to be enhanced because while fixing the compensation the Reference Court has not taken into consideration the total life of the trees as well as the yield and market rate as per the private Valuers report. In the alternate Mr. Joshi submitted that even if this Court finds that the valuation for the fruit bearing trees made by the Reference Court is just and proper, there is no reason to interfere with the award passed by the Reference Court and the claimants ought to receive the market value for the land as well as the compensation for fruit bearing trees. Mr. Joshi does not agree with the submissions made by the learned AGP that the claimants can have either of the benefits i.e. either the compensation for the land by way of its market value or the compensation for the fruit bearing trees on the basis of the income capitalization method. In support of these arguments Mr. Joshi has placed reliance on the following decisions:
1. State of Haryana v. Gurcharan Singh MANU/SC/0019/1996: 1995 Supp (2) SCC 6372. KAA Raja and Ors. v. State of Kerala and Anr. MANU/SC/0781/1994 : (1994) 5 SCC 1383. State of Jammu and Kashmir v. Mohammad Mateen Wani MANU/SC/0438/1998: AIR 1998 SC 24704. Navanath and Ors. v. State of Maharashtra MANU/SC/0589/2009: JT 2009 (6) SC 3865. Hansraj Sharma (dead) by Lrs v. Collector, Land Acquisition, Tehsil and District Doda MANU/SC/1053/2004: 2005 (2) Mh.L.J. 557
5. In support of the claim for enhancement of compensation, the claimants had examined in all four witnesses and also had relied upon the experts evidence recorded in L.R. No. 402 of 1989. PW 1 Somnath Damodhar Gorade was the claimant in L.R. No. 413 of 1989, PW 2 Chandrabhan Mahadu Ghotekar was the claimant in L.R. No. 412 of 1989 and he stated that his brothers were claimants in L.R. Nos. 415 and 417 of 1989 and he deposed on their behalf as well. He admitted that the total land acquired and covered under L.R. Nos. 412, 415 and 417 of 1989 admeasure 2 hectares and each of the three brothers had 1/3rd share. In addition, two more witnesses, namely, PW 3 Shri Uttamrao Wamanrao Patil, Agricultural Consultant and Expert for private valuer and PW 4 Jayendra Valabhdas Pabari Architect and approved Government Valuer were examined. PW 3 was examined as an expert valuer for determining the compensation payable for fruit bearing trees on income capitalization basis and PW 4 was examined to determine the valuation of the structures standing on Gat No. 200. In the evidence of PW 1, 7x12 extracts of his land in Gat No. 199 and totally admeasuring 1 H. 34 R. were brought on record at Exhs. 15, 16, 17 and 18. He also brought on record the railway receipt to show goods dispatched to Varanasi (Exh. 20), to Patna (Exh. 21), receipts of Carting Agent of Manmad (Exh. 22) and of Lasalgaon (Exh. 23). PW 1 -Somnath stated in his depositions that there were 1003 grape trees, 273 guava trees and 25 mango trees standing in his land at the time when the possession was handed over. He relied upon the Government Valuers report at Exh. 14 which he had produced before the court and he claimed Rs. 2000/-per grape tree, Rs. 1000/-per guava tree as compensation. In his cross examination he admitted that the plantation of guava garden was in the year 1974-75 and the grape garden plantation was in the year 1976. In his examination-in-chief he stated that guava and grape trees were fruit bearing trees at the time of acquisition and this statement clearly went to show that the 25 mango trees which he claimed were standing on the land were not bearing fruits at the relevant time and obviously he did not claim compensation on the lines he claimed for the grape and guava trees. PW 2 Chandrabhan stated that the share of each of the three brothers was 66 R, 67 R and 67 R out of 2 hectare land from Gat No. 200. As per him, in his land (L.R. No. 412/89) there were 200 grape trees, in the land of his brother Gajanan (L.R. No. 415/89) there were 181 grape trees and in the land of second brother Depram (L.R. No. 417/89) there were 192 grape trees, thus making a total of 573 grape trees in Gat No. 200. However, the Government valuer found 562 grape trees in Gat No. 200. He also relied upon the report at Exh. 14 made by the Government Horticulturist and stated that he had engaged a private valuer to determine the valuation of fruit bearing trees. He also relied upon the letter dated 10/12/1982 at Exh. 26. Coming to the evidence of PW 3, as noted earlier, he admitted that he visited the land in Gat No. 199 for the first time on 15/10/1985 and noted that there were in all 970 grape trees of 6 years of age, 33 grape trees were less in age and the quality of 970 trees were of Thomsan Seedless. He also stated that there were 273 guava trees of 9 years old and they were of local variety. He further stated that he noticed 12 mango trees of 9 years of age in the said land in Gat No. 199. He stated that he visited the land in Gat No. 200 also on the same day and he found 562 grape trees of 5 years old, 4 guava trees of 8 years old, 2 lemon trees of 7 years old, 3 bor trees of 8 years old and 6 mango trees of 9 years of age. He submitted the valuation report at Exhs. 33, 34, 35 and 36. He admitted in his cross-examination that the mango trees in the land at Gat No. 199 were of local variety and they were not planted. It is pertinent to note that the Government valuer noticed only 249 guava trees in the land in Gat No. 199 which were fruit bearing, whereas the other 24 guava trees were just saplings.
The private valuer had fixed the annual income of 970 grape trees at Rs. 1087/-per tree as against the same valuation is fixed at Rs. 595/-and Rs. 423/-per tree by the Government valuer in Gat No. 199. The private valuer did not consider granting any compensation for 33 grape trees which were newly planted in the said land. In respect of grape trees in Gat No. 200, the private valuer fixed the annual income of Rs. 1043/-per tree, whereas the Government valuer fixed the same at Rs. 423/per tree. In respect of the guava trees, the private valuer fixed the compensation at Rs. 800/-per tree, whereas the Government valuer fixed the said amount at Rs. 600/-per tree for 249 trees and Rs. 56/-per tree for 24 trees. In respect of the mango trees, the Government valuer fixed the compensation at Rs. 50/-per tree and Rs. 75/-per tree whereas the private valuer estimated the said amount at Rs. 5018/-per tree. The following comparative chart will indicate the valuation made by the Government valuer, private valuer and the court:
6. The 7x12 extracts at Exh. 15 in respect of Gat No. 199 shows that in the year 1975-76 guava garden was planted for the first time on 28 R land and jwari cultivation was shown on 1 hectare and same situation continued in the next year i.e. 1976-77. In the year 1977-78 plantation of grape garden has been shown on 1 H. and the guava garden remained as it is. It is thus clear that so far as the land in Gat No. 199 admeasuring 1 H. 34 R. is concerned, it was already under horticulture development much before the notification under Section 4 of the Act was issued and initially it was only guava garden plantation (local variety), whereas in the year 1977-78, 1 H. land was brought under grapes cultivation. A reasonable inference is required to be drawn that in 1 H. of land there were about 1000 grape trees planted and obviously on the remaining 34 R. land there was guava garden. The mango trees noticed were not planted and obviously they must be standing on the peripheral areas. The railway receipts and dispatch receipts brought on record at Exhs.20, 21, 22 and 23 also pertain to the period of February 1980 and while PW 1 was in the cross examination, it was put to him that there was no cultivation of grapes in his land and his father used to buy fruits from the market in bulk and dispatch them to other areas. This suggestion was denied. We are, therefore, satisfied that the guava garden and grape garden was existing on the land in Gat No. 199 before the notification under Section 4 of the Act was issued and hence the submissions made by the learned AGP that the said plantation was done only after the notification under Section 4 of the Act was issued are unsustainable.
7. We have perused the valuation report at Exh.14 made by the Government horticulturist and Exhs. 33, 34, 35 and 36 made by PW 3. Undoubtedly both of them followed the A.E. Mirams system for valuation of the fruit bearing trees on income capitalization method.
8. The claimants placed on record the valuation report at Exh. 14 and made by the Government Horticulturist. The said report appears to be dated 1/8/1983. It states that in the land in Gat No. 199 there were 363 grape trees of 6 years of age and its future age was 19 years. He recorded the annual yield of each tree at 20 Kgs. and the wholesale market price at Rs. 6/-per Kg., thus making an annual income of Rs. 120/-per Kg. He recorded that there were 602 other variety of grape trees of 5 years of age and the future age was 20 years. He has shown the annual yield at 15 Kgs. and the wholesale market price at Rs. 6/-per Kg., thus making the annual income of Rs. 90/-per tree. He further stated that there were 38 grape trees which were just one year old and, therefore, there could not be any compensation, except the plantation price. He noted that there were 249 guava trees of 9 years of age and future age was 31 years. He estimated the annual yield at 60 Kgs. and the wholesale market price at Rs. 1/-per Kg., thus making the annual income at Rs. 60/-per tree. He noted that there were 15 mango trees but could not give the income as they were of local nature and they were not planted. So far the land in Gat No. 200 is concerned, he has noted 562 grape trees of 5 years of age and future age was 20 years. He estimated annual yield at 15 Kg. per tree and wholesale rate at Rs. 6/-per Kg., thus making a total income of Rs. 90/-per tree per annum. Guava trees he valued on the same basis as it was done in respect of the land in Gat No. 199. Whereas for the remaining 38 grape trees, he granted Rs. 20/-per tree towards plantation. For the grape trees in Gat No. 200, the Horticulturist awarded Rs. 423/per tree as the total compensation and for 562 grape trees it came to 562x423 = Rs. 2,37,726/-. So far as guava trees in Gat No. 199 are concerned he estimated the total compensation at Rs. 600/-per tree and for the same tree in Gat No. 200, as there were only two trees he granted the same compensation. In respect of mango trees, he granted Rs. 50/- and Rs. 75/- per tree.
PW 3, the private valuer, in his report at Exh. 33 followed the very same method, but estimated the annual yield of each grape tree at 26 Kg. per tree and wholesale market rate at Rs. 7/-per Kg. He thus estimated the annual income of each grape tree at Rs. 182/-. In Gat No. 199 he calculated the total compensation for each grape tree at Rs. 1087/-. For the remaining 33 grape trees he stated that Rs. 60/-per tree was required to be paid as compensation towards the plantation is concerned and no compensation in the income capitalization. For guava trees he estimated the annual yield at 90 kg. And the wholesale market rate at Rs. 1.25. For the mango trees he calculated the annual income at Rs. 430/-per tree. He worked out a total compensation for the guava trees at Rs. 1008/-per tree and for the mango tree at Rs. 5018/-per tree.
9. We are not in agreement with the private valuers report in respect of the annual as well as the wholesale market rate. The report submitted by the Government Horticulturist at Exh. 14, in our opinion, is more realistic and the Reference Court has not given any reasons, leave alone satisfactory reasons, to discard the same. We, therefore, accept the valuation report made at Exh.14 to determine the compensation of the fruit bearing trees in toto. The Reference Court has considered both the reports and tried to fix the compensation amount midway. In L.R. No. 369/89, the Reference Court had granted Rs. 2 lacs by way of compensation for 211 grape trees i.e. Slightly less than Rs. 1000/-per tree. But it appears only the private valuers report was considered in the same and there was no valuation report submitted by the Government Horticulturist. But such a report of the Government Horticulturist was considered for guava trees and the valuation varied from Rs. 400/-to Rs. 600/per tree. The Reference Court fixed the valuation at Rs. 1000/per guava tree but without any reasons. So far as mango trees are concerned, again the valuation was done on the basis of the private valuers report and it was fixed at Rs. 5000/-per mango tree. No reasons were set out in this case as well. Under these circumstances, the valuation made in the earlier references i.e. L.R. No. 368, 369 and 372 of 1989 could not have been relied upon by the Reference Court in the instant case, and on the face of the valuation report at Exh.14, which was relied upon by the claimant only.
10. Mr. Joshi has placed on record a copy of the Circular dated 18th December 1975 issued by the Revenue and Forest Department, Government of Maharashtra setting out the procedure for valuation of fruit bearing trees by following A.E.Mirams method of capitalisation so as to determine the valuation of fruit bearing trees in gardens or orchards excepting grape vine yards:
In such cases, trees are planted with a view to obtaining regular income and the orchard becomes an enterprise. As however, in case of orchards, excepting grape vine yards the part of income attributable to the Cultivators risk and Profits is comparative by small, it would be reasonable to consider about 10% of Gross income to form this item of deduction. In such cases, therefore, only 10% of gross income be deducted on account of Cultivators Profit. In addition, usual items of decutions such as cost of cultivation, manures, maintenance, insecticides, watch and ward packing and transportation etc. will also be taken into consideration.
Similarly for Grape Vine Yards the procedure set out states as under:
Grape is very delicate crop and apart from heavy expenditure to be incurred towards cost of cultivation, manure, pesticides and insecticides, watering, watch and ward maintenance, etc. must of the yield depends upon the cultivators skill in judging the appropriate time for cutting operation. In such cases naturally therefore a substantial portion of Gross Income is attributable to the cultivators profits and risks. In view of this, in case of grape vine yards ___ % (illegible) of Gross Income should be regarded as forming deduction on account of % Cultivators Profits and Risks. In addition, consideration in working out net income.
Along with the Circular Table-1 on the basis of income capitalisation (interest on capital at 9% and for redemption of capital at 4%) was also annexed. The Horticulture Officer has undoubtedly followed the said procedure set out in the Circular dated 18th December 1975 as well as Mirams method of capitalisation of income. Therefore, the valuation report submitted at Exhibit 14 is more authentic, realistic and justifiable.
11. At this stage we must consider the submissions made by Mrs. Mulekar pointing out that the possession of the land was taken on 8/4/1987 and thus the land owners enjoyed the income of the fruit bearing trees for about 6-7 years after the notification under Section 4 of the Act was issued and consequently this six years period or at least four years period was required to be deducted from the future age. We are not impressed by these submissions, more so when the SLAO did not take any steps to examine the Government Horticulturist so as to reduce the future age. In fact, the SLAO took no steps to defend the award passed by the Reference Court in respect of the compensation awarded for the fruit bearing trees. Mr. Joshi the learned Counsel for the claimants urged before us to follow the private valuers report, but we do not find any merits in this submission. The dispatch receipts placed on record at Exhs.20, 21, 22 and 23 do not indicate the market rate at the relevant time i.e. in the year 1980 and the private valuer has not given any justification in support of his increased figure of annual rate as well as market rate.
12. Now coming to the main issue as to whether the Reference Court was justified in granting compensation for the land as well as for the fruit bearing trees and to decide the said issue, let us refer to the legal position emanating from the judgments relied upon by both the sides.
(a) In the case of Mohammad Mateen Wani (Supra), the award of granting compensation in respect of the fruit bearing trees and tube well was not interfered by the Apex Court as the same was based on the Government Circular which allowed such compensation separately and, therefore, the said decision is not applicable in the facts of this case. Even in the case of Hans Raj Sharma (Supra), the issue as to whether market value for the land which was perennially irrigated and for the orchards standing thereon could be granted or only one of them is required to be granted was not for consideration. There was no material to show that in the said case the fruit bearing trees were planted for commercial/horticultural production. In the case of Navanath (Supra), the Apex Court in para 33 noted thus,The legal principle laid down in this behalf in a catena of decisions of this Court is that the market value of the land cannot be determined both on the basis of sale instance as also on capitalization method keeping in view the fact that it had fruit bearing trees. But, in this case, nothing has been pointed out before us that the fruit bearing trees in large numbers were existing in the agricultural land itself and the Reference Court had valued the same land by adopting two different methods. Had such as position been existing, the Land Acquisition Officer himself and/or the Horticulturist and the Consulting Engineer appointed on behalf of the State would not have taken recourse thereto. They are experts in their own fields. The Land Acquisition Officer is presumed to know the legal principles governing valuation. Furthermore, as noticed hereinabove, recourse to the determination of amount of compensation of fruit bearing trees have been taken keeping in view the guidelines issued by the State itself.Mr. Joshi, therefore, referred to the Circular dated 18/9/1975 and urged that the award passed by the Reference Court and impugned in these appeals does not call for any interference. We do not find any substance in these arguments. The circular of the Government of Maharashtra does not state that the market rate as well as compensation by income capitalization is required to be given in respect of the bagayat land.(b) In the case of State of Haryana v. Gurcharan Singh and Anr. (Supra), the Supreme Court in para 3 stated thus,3. ...It is settled law that the Collector or the court who determines the compensation for the land as well as fruit bearing trees cannot determine them separately. The compensation is to the value of the acquired land. The market value is determined on the basis of the yield. Then necessarily applying suitable multiplier, the compensation needs to be awarded. Under no circumstances the court should allow the compensation on the basis of the nature of the land as well as fruit bearing trees. In other words, market value of the land is determined twice over; once on the basis of the value of the land and again on the basis of the yield got from the fruit bearing trees. The definition of land includes the benefits which accrue from the land as defined in Section 3(a) of the Act. After compensation is determined on the basis of the value of the land as distinct from the income applying suitable multiplier, then the trees would be valued only as firewood and necessary compensation would be given....(c) A three Judge Bench in the case of Airports Authority of India (Supra) referred to the decision in Gurcharan Singhs case and set out the meaning of capitalization. The court stated that capitalization means the method used to convert future benefits to present value by discounting such future benefit at an appropriate rate of return and it is the process of converting the net income of a property into its equivalent capital value. The court further stated that while capitalizing the income, future income, its duration along with the risk factor is to be taken into consideration. Capitalizing rate means a designated rate of return which converts net future benefits to capital value. The court reiterated the law laid down in Gurcharan Singhs case in the following words,8. It is settled law that in evaluating the market value of the acquired property, namely, land and building or the land with fruit bearing trees standing thereon, value of both is to be determined not as separate units but as one unit. Therefore, it would be open to the Land Acquisition Officer or the court, either to assess the land with all its advantages and fix the market value thereof on the basis of comparable sale instances. In case where comparable sale instances are not available and where there is reliable and acceptable evidence on record of the annual income, market value could be assessed and determined on the basis of net annual income multiplied by appropriate multiplier for its capitalization. In the case of fruit bearing trees their net yield is to be taken into consideration, that is to say, by deducting expenses incurred for getting the yield and also the value of the timber and expenses to cut and remove the trees from the land. For capitalizing the income, previously income from the gilt-edged securities was the basis, but thereafter rate of interest in the nationalized banks where deposits are quite safe is taken into consideration as the proper basis. If the interest rate in a nationalized bank or other safe investments, on a long term fixed deposit, say is 10%, and the yield from the trees p.a. Is Rs. 5000, then for getting the said income, deposits of Rs. 50,000 would be required to be made. Hene, the value of the said trees along with the land can be safely assessed as Rs. 50,000. In the present case, there is no question of acquiring the land. The land remains with the claimants. The question is limited with regard to payment of compensation for the damages because of cutting of trees. With regard to fruit bearing trees, their lifespan including risk factor is also required to be taken into consideration. Hence, yield of trees multiplied by an appropriate multiplier for its capitalization after taking into consideration all relevant factors would be the basis for determining the compensation.
13. This Court in the case of Ramgonda Layappa Birajdar (Supra), Chindha Fakira Patil (Supra) and Sahadu Aba Shete (Supra) has followed the above stated decisions of the Supreme Court in the case of Gurcharan Singh (Supra) and Airports Authority of India (Supra). In the case of Ramgonda Birajdar, this Court held that the market value of the land is to be determined on the basis of the value of the land but the value of fruit bearing trees cannot be added thereto and needless to say that in case of trees yielding forest produce are to be valued in addition to the value of the land. In the case of Sahadu Aba Shete (Supra), this Court stated that the trees are integral part of the land and the claimants cannot claim separate value for trees. In the case of Chindha Fakira Patil (Supra), this Court also referred to the decision in the case of Koyappathodi M. Ayisha Umma v. State of Kerala MANU/SC/1477/1991 : AIR 1991 SC 2027 along with Gurcharan Singhs case and held that the claimants are not entitled to compensation by way of market price of the land plus compensation for income from fruit bearing trees and they are entitled to either, may be whichever is higher out of the two. We are in full agreement with the said view and we reiterate that the claimants cannot claim compensation for the bagayat land as well as for the fruit garden/orchard standing thereon and they have to claim one of them and the court must grant the higher of them so long as the entire land is covered by such orchard and this principle will also be applicable to the extent of the land under plantation of the garden/orchard and in respect of the balance land, if any, the owner will be entitled for the market value of the land only.
14. So far as Gat No. 199 is concerned, we have noted above, and on the basis of the 7x12 extract at Exhs.15, 16, 17 and 18 that the entire land admeasuring 1 H. 34 R was covered by the grape trees as well as the guava trees and, therefore, by following the law laid down in the case of Airports Authority of India (Supra), the claimant in the said case will be entitled only for compensation for the fruit bearing trees and shall not be entitled, in addition, for the compensation for the land admeasuring 1 H. 34 R. So far as the land in Gat No. 200 is concerned, Mr. Joshi the learned Counsel for the claimants has placed on record copies of the 7x12 extracts and we have noted that grape trees were planted on 80 R. land in the year 1978-79. However, in the next year i.e. In the year 1979-80 the grape garden was retained only on the land admeasuring 60 R. and 40 R land was brought under cultivation of sugarcane whereas the balance land was for the cultivation of other crops. This plantation of grape trees was continued on 60 R land in the subsequent years and in the year 1981-82 we have noted that the grapes plantation was on 60 R land, sugarcane crop on 40 R land, wheat cultivation on 40 R land, gram (Harbhara) on 40 R and balance of 18 R land was under onion crop cultivation and this continued till the year 1985-86 when the entire holding was partitioned between the three brothers who are the claimants before us. So far as the grape plantation is concerned in each case, it continued on 20 R land and on the remaining land holding varying from 46 to 47 R there was either cultivation of sugarcane or other crops. Hence, the grape orchards were standing on 20 R land in each case i.e. LR Nos. 412, 415 and 417. By following the law laid down in the case of Airports Authority of India (Supra) every claimant in respect of Gat No. 200 will be entitled for 20 R land compensation for fruit bearing trees alone and shall not be entitled for the market value of the land, in addition. Whereas for the balance land, the compensation will have to be paid only on the basis of the market value and not on the basis of the fruit bearing trees. We have been able to segregate the land under cultivation of fruit bearing trees/orchards and the land under cultivation of other crops solely on the basis of the 7x12 extract which were either proved before the Reference Court or placed before us by the claimants themselves.
15. As per Exhibit 14 the land located in Gut No. 199, there were 15 mango trees which were of 6 years age and 10 mango trees of 4 years of age. It is no where the case, even in the evidence of the claimant or as per the report at Exh.14 that these mango trees were planted and admittedly they had naturally grown. The claimant in his depositions before the Reference Court did not claim compensation for these trees. The Government Horticulturist estimated the compensation at Rs. 75/-per tree for 15 trees and Rs. 55/-per tree for the remaining 10 trees. The reference court noted that the private valuer (PW3) had estimated the compensation for each tree at the rate of Rs. 5,018/- and there could not be so much of difference between the estimation made by the private valuer and the Government Horticulturist. The reference court therefore proceeded to fix the compensation for each mango tree at the rate of Rs. 3,000/-but without giving any justification. This compensation rate fixed by the reference court for 25 mango trees is unsustainable and there is no reason to discard the valuation made by the Government Horticulturist. The claimants cannot be granted compensation for mango trees on the basis of income capitalization method. It was never the case of the claimants that they had planted the mango trees for commercial income and on other hand they were just widely grown mango trees. We therefore, set aside the compensation of Rs. 3,000/-per mango tree as granted by the Reference Court and hence we uphold the compensation at Rs. 75/each for 15 mango trees and Rs. 55/-each for 10 mango trees as fixed by the government horticulturist. This finding will be equally applicable to the mango trees located in Gut No. 200 and covered by LR No. 412 of 1989 and L.R. No. 415 of 1989.
So far as the structures and well are concerned, we are satisfied that the valuation /compensation fixed by the Reference Court is just and proper, having regard to the evidence placed before the said Court through PW4. The Special Land Acquisition Officer did not adduce any evidence in contra and the cross examination of the said witness did not make out that the valuation was doubtful or unreasonable. We therefore, uphold the valuation/compensation fixed by the reference court for well and structures in the land in Gat No. 199 as well as Gat No. 200.
16. We now come to the arguments advanced by Mr. Joshi on the point that the compensation granted for the fruit bearing trees should be treated and confirmed by way of damages. As we noted earlier, the land in Gat Nos. 199 and 200, the entire area not covered by grape and guava trees or the orchards was under cultivation either for sugarcane crop, wheat, onions, etc. and it was not the case of the claimants that when the possession was taken over on 8/4/1987 any standing crop was not allowed to be harvested and therefore damages were required to be paid. This concept of damages will be applicable only in such cases and it cannot be made applicable when fruit bearing trees are planted for generating monetary income i.e. orchards /gardens. For the land which was not covered by orchards/gardens the claimant will be entitled to only one of the two benefits i.e. market value of the land or compensation in respect of fruit bearing trees on the basis of income capitalization method and the claimants cannot claim both the benefits, as has been noted by us hereinbefore.
17. In the circumstances, we allow the appeals filed by the State Government partly and dismiss the cross objections by modifying impugned common award as under:
1] LR No. 413 of 1989, Gut No. 199, Area acquired 1 H 34 R
In addition the claimant will be entitled for 30% solatium, 12% additional component and interest as payable under Section 28of the Act.2] LR No. 412 of 1989, Gut No. 200/1, Area acquired 0.67 R
In addition the claimant will be entitled for 30% solatium, 12% additional component and interest as payable under Section 28of the Act.3] LR No. 415 of 1989, Gut No. 200/2, Area acquired 0.66 R
In addition the claimant will be entitled for 30% solatium, 12% additional component and interest as payable under Section 28of the Act.4] LR No. 417 of 1989, Gut No. 200/3, Area acquired 0.67 R
In addition the claimant will be entitled for 30% solatium, 12% additional component and interest as payable under Section 28 of the Act.
By adjusting the amount awarded by Special Land Acquisition Officer the balance amount in terms of above award shall be payable if the same has not yet been received by the claimants, as expeditiously as possible and within a period of eight weeks from today by the Collector concerned.
Civil Application Nos. 4486, 4487, 4488 and 4489 of 2000 do not survive and the same shall stand disposed as such.
A copy of this award be forwarded to the Collector, Nashik.
After the judgment was pronounced, Mr. R.M. Haridas h/f Mr. Joshi, the learned Counsel for the claimants submitted an oral application to stay the operation of the judgment. We have heard Mrs. Mulekar, the learned AGP, in this regard.
Oral application is allowed and the operation of our judgment and order is stayed for a period of 12 weeks.
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