sale deed dated 25.07.2007 was post notification. But the gap
was very small being about 5 months, since the date of last
publication of notification under Section 4 (1) of the L. A., Act
was 11.12.2006. In the case of “Balchandra Anant Wagle and
others” (supra), this Court relied upon the judgment of the
Hon'ble Supreme Court in the case of “Chimanlal
Hargovinddas v/s. Special Land Acquisition Officer, Poona”
reported in [A.I.R. 1988 SC 1652] wherein it has been held
that even post notification instances can be taken into13
account: (1) if they are very proximate, (2) genuine, and (3)
the acquisition itself had not motivated the purchaser to pay
a higher price on account of resultant improvement in the
development prospects. In the present case, there was
nothing on record to suggest that the purchaser of the sale
deed dated 25.07.2007 was motivated in the manner as
above. Therefore, said sale deed dated 25.07.2007 was rightly
considered by the learned Reference Court. The said sale
deed plot was in very close proximity with the acquired land
distance wise as well as nature wise and was also very close
to the date of notification.
IN THE HIGH COURT OF BOMBAY AT GOA.
FIRST APPEALS NO. 223 OF 2009, 229 OF 2009 AND 232 OF
2009.
FIRST APPEAL NO. 223 OF 2009.
Goa Industrial Development
Corporation
Versus
Maria Tereza N. Quadros
CORAM :- U. V. BAKRE, J.
DATE : 2nd December, 2014.
Citation:2016 (3) ALLMR810
This common judgment shall dispose of the above three
Appeals as they pertain to similar type of land situated in the
same locality, acquired vide the same notification published
under Section 4(1) of the Land Acquisition Act, 1894 (L. A. Act,
for short).
2. First Appeal No. 223/2009 arises out of the Judgment and
Award dated 06.07.2009 passed by the learned District Judge-
2, South Goa, Margao ('Reference Court' for short), in Land
Acquisition Case No. 59/2008. First Appeal No. 229/2009 is
directed against the Judgment and Award dated 06.08.2009
passed by the learned Reference Court in Land Acquisition
Case No. 63/2008. Lastly, First Appeal No. 232/2009 is
directed against the Judgment and Award dated 21.07.2009
passed by the learned Reference Court in Land Acquisition
Case No. 60/2008.
3. Vide notification issued under Section 4(1) of the L. A.
Act and published in the Official Gazette dated 23.11.2006
and lastly published at the concerned places through the4
Mamlatdar of Salcete on 11.12.2006, Government acquired
land for construction of missing link of National Highway 17-B
in Loutolim village at Verna Industrial Estate of Salcete
Taluka.
4. FIRST APPEAL NO. 223/2009 : LAND ACQUISITION CASE
NO. 59/2008.
The acquisition included the land of the applicant in Land
Acquisition Case No. 59/2008, bearing survey numbers 227/7
(part), 228/1 (part) and 229/5 (part) of Loutolim Village. An
area of 350 square metres was acquired from survey no.
227/7(part); an area of 577 square metres was acquired from
survey no. 228/1(part); and an area of 369 square metres was
acquired from survey no. 229/5. The learned Land Acquisition
Officer( L.A.O., for short) classified the entire acquired land as
bharad land and granted compensation at the rate of ` 50/-
per square metre and also granted an amount of
` 24,891.30/- for the gadga wall of 100 metre length situated
in survey no. 229/5. The applicant filed application under
Section 18 of the L. A. Act before the L.A.O. thereby claiming
compensation at the rate of ` 1000/- per square metre which
gave rise to the Land Acquisition Case No. 59/2008.
Accordingly, issues were framed by the Reference Court. The5
applicant examined her constituted attorney namely Estefania
D'Cruz as AW1 and she produced sale deed dated 10.3.1997
as Exhibit 13 and sale deed dated 25.7.2007 as Exhibit 14.
The applicant examined Shri Mahendra Kakule, an Engineercum-Registered
Valuer, as AW2 who produced his valuation
report at Exhibit 19. The respondents did not examine any
witness. Upon consideration of the entire evidence on record,
learned Reference Court enhanced compensation of the
acquired land to ` 700/- per square metre and further
awarded sum of ` 24,393.18/- towards the gadga wall of the
length of 55 metres situated in acquired land from survey no.
227/7(part) and of the length of 43 metres situated in
acquired land from survey no. 228/1(part). All statutory
benefits have also been awarded.
5. FIRST APPEAL NO. 229/2009 : LAND ACQUISITION CASE
NO. 63/2008.
The said acquisition also included land admeasuring
1363 square metres from survey no. 184/1 part of Loutolim
Village belonging to the applicants in Land Acquisition Case
No. 63/2008. The learned L.A.O. classified the land as bharad
land and granted compensation at the rate of ` 50/-per square
metre. Not being satisfied with the offer made by the L.A.O.6
the applicants filed the application under Section 18 of the L.
A. Act before the L.A.O., thereby claiming compensation at
the rate of ` 800/- per square metre, which gave rise to the
Land Acquisition Case No. 63/2008. Accordingly, an issue was
framed by the Reference Court. The applicants examined
Alexander Araujo @ Alexander Perpetua Nascimento Araujo as
AW1. He produced sale deed dated 25.7.2007 as Exhibit 17
and sale deed dated 10.3.1997 as Exhibit 18. The applicants
also examined Shri Mahendra Kakule an expert as AW2 who
produced his valuation report at Exhibit 22. The respondents
did not examine any witness. Upon consideration of the entire
evidence on record, learned Reference Court enhanced
compensation of the acquired land to ` 700/- per square
metre and also awarded all statutory benefits under the L. A.
Act.
6. FIRST APPEAL NO. 232/2009 : LAND ACQUISITION CASE
NO. 60 OF 2008.
The same acquisition also included an area of 1469
square metres of land from survey no.186/1 (part), 475
square metres from survey no. 228/2 (part) and 843 square
metres from survey no. 228/4 (part) of Loutolim
Village,belonging to the applicants in Land Acquisition Case7
No. 60/2008. The learned L.A.O. classified the entire acquired
land as bharad land and awarded compensation at the rate of
` 50/- per square metre and further awarded a sum of `
26,085/- towards the value of the trees. Not being satisfied
with the offer made by the L.A.O., the applicants made
application under Section 18 of the L. A. Act before the LAO
thereby claiming compensation at the rate of ` 1000/- per
square metre which gave rise to the Land Acquisition Case
No. 60/2008. Accordingly, issues were framed. The applicants
examined Shri Vivek Gomes, legal heir of applicant no. 1 as
AW1. He produced survey plans at Exhibit 12 colly, sale deed
dated 10.3.1997 as Exhibit 13 and sale deed dated
27.5.2007 at Exhibit 14. The applicants also examined Shri
Mahendra Kakule, an engineer-cum-registered valuer, as
AW2, who produced his valuation report as Exhibit 23. The
respondents did not examine any witness. Upon consideration
of the entire evidence on record, learned Reference Court
enhanced compensation of the acquired land to ` 700/- per
square metre.
7. Aggrieved by the judgments and Award in said Land
Acquisition Cases, the respondents have filed the above
appeals. 8
8. Mr. Naik, learned counsel appearing on behalf of the
appellant submitted that the relevant date for determination
of the market value of the acquired land was 11.12.2006
whereas one of the sale deeds considered by the Reference
Court was very old dated 10.3.1997 which ought not to have
been considered on account of big gap. He further pointed
out that plot of the sale deed dated 25.7.2007 was post
notification and besides that it was in respect of a fully
developed plot of a smaller size as compared to the acquired
land and therefore, the same also could not have been
considered. In the alternative, Mr. Naik pointed out that the
Reference Court made a deduction of only 5% towards
development charges which according to him is arbitrary and
erroneous. He submitted that deduction of 1/3rd ought to
have been made towards development charges and further
deduction ought to have been made on account of the
smallness of size of the sale deed plot. He pointed out that
merely because the acquired land was situated in settlement
zone, Reference Court held that no conversion was required.
He submitted that conversion would be required for such
lands also. He relied upon the judgment of the Supreme
Court in the case of "Maj. Gen. Kapil Mehra V/s. Union of India 9
(UOI)” reported in [2014 (12) SCALE 248]. He therefore, urged
that the appropriate deduction of 1/3rd towards development
charges and further adequate deduction on account of small
size of sale deed plot be made and compensation be reduced
accordingly.
9. On the other hand, Mr. Diniz, learned Counsel appearing
for the respondents, submitted that the transaction of sale
deed dated 25.7.2007 was only few months after the date of
notification and that the said sale instance was genuine and
very proximate and the acquisition had not motivated
purchaser to pay higher price. In this regard, he relied upon
the judgments of this Court in the cases of:-
i. Balchandra Anant Wagle and others V/s.
Land Acquisition Officer and others, [2012
(5) Bom.C.R. 240]
ii. Land Acquisition Officer PWD (Cell) and
another v/s. Shantaram J. S. Kantak,
[2011 (1) Bom. C.R.121].
10. Learned Counsel for the respondents further submitted
that the acquired land was not totally undeveloped land and it
was of such a nature that no much development would have
been required. He therefore, urged that the deduction of 5%
has been rightly been made by the Reference Court and10
therefore, no interference is called for with the impugned
Awards.
11. I have gone through the original record and
proceedings, in each case. I have considered the arguments
advanced by learned counsel for the parties and also the
judgments relied upon by them.
12. The point that arises for my determination in all the
appeals is whether the compensation awarded by the learned
Reference Court is just and reasonable or whether it requires
reduction.
13. The evidence on record in each case reveals that
facilities like water connection, telephone, electricity and
transport were available to the acquired lands and major
amenities like shops, schools, restaurants, chapel, were very
close to the acquired land. The acquired lands had no
encumbrances and were accessible to road. The evidence on
record also shows that the acquired land fell in settlement
zone and therefore suitable for construction. In portion of
Survey no. 229/5, which was not acquired, there was a
residential house and a garage and in the portion of survey11
no. 227/7, which was not acquired, there was an old structure,
already existing. There were residential houses in the
neighbourhood of the acquired lands. No doubt, learned
Reference court wrongly held that there was no need for land
conversion. Even if property fell in the settlement zone,
conversion of the land would be required and admittedly the
same was not done in respect of the acquired land, in all the
above cases. Some expenses were bound to be incurred for
conversion if the acquired land were to be used for
construction purposes. A perusal of the judgment of the
Reference Court reveals that the sale deed dated 10.03.1997
has not been considered by the learned Reference Court
individually. The learned Reference Court considered the
same only for knowing the trend of price of the land in the
vicinity of the acquired land. It was found that the rates of
lands had not increased by 10% annually, during the
intervening period of the two sale deeds. In fact, since there
was a gap of about 5 months between the date of sale deed
dated 25.07.2007 and the date of publication of notification
under Section 4(1) of the L. A., Act, some increase in the rate
ought to have been granted because it is a settled law that
prices of land goes on increasing annually. However, on the
basis of both the sale deeds, considering that individually the12
acquired land from each survey number was small in area, the
learned Reference Court held that the market value of the
land in the locality of the acquired land at the time of
publication of notification under Section 4(1) of the L. A. Act
was ` 700/- per square metre. In Land Acquisition Cases No.
60/2008 and 63/2008, the learned Reference Court further
observed that the land in vicinity was sold at the rate of ` 742
per square metre, and by making deduction of ` 42/- i.e.
about 5%, towards development charges, the market value
comes to ` 700/- per square metre. The learned reference
Court therefore held that the market value of the acquired
land was proved to be ` 700/- per square metre.
14. It is true that the sale transaction in respect of the said
sale deed dated 25.07.2007 was post notification. But the gap
was very small being about 5 months, since the date of last
publication of notification under Section 4 (1) of the L. A., Act
was 11.12.2006. In the case of “Balchandra Anant Wagle and
others” (supra), this Court relied upon the judgment of the
Hon'ble Supreme Court in the case of “Chimanlal
Hargovinddas v/s. Special Land Acquisition Officer, Poona”
reported in [A.I.R. 1988 SC 1652] wherein it has been held
that even post notification instances can be taken into13
account: (1) if they are very proximate, (2) genuine, and (3)
the acquisition itself had not motivated the purchaser to pay
a higher price on account of resultant improvement in the
development prospects. In the present case, there was
nothing on record to suggest that the purchaser of the sale
deed dated 25.07.2007 was motivated in the manner as
above. Therefore, said sale deed dated 25.07.2007 was rightly
considered by the learned Reference Court. The said sale
deed plot was in very close proximity with the acquired land
distance wise as well as nature wise and was also very close
to the date of notification.
15. A perusal of the sale deed dated 25.7.2007 reveals that
plot of said sale deed was fully developed plot. Provisional
NOC for sub-division of the property was obtained from Town
and Country Planning Department. Provisional NOC for subdivision
of property was also obtained from the Village
Panchayat of Loutolim and the office of the Collector had
issued conversion sanad thereby granting permission to the
vendor for using the plot for residential use. Sale deed further
reveals that property was developed and plots bearing no. 2
admeasuring 491 square metres and no. 3 admeasuring 443
square metres respectively were purchased for a sum of14
` 7,00,000/-, i.e. at the rate of ` 742/- per square metre. As
compared to the above, in respect of the acquired land no
conversion sanad was obtained nor NOCs for development
were obtained. Merely because, the acquired land was falling
in settlement zone, that cannot mean that they were fully
developed lands.
16. In the case of “Maj. Gen. Kapil Mehra” (supra), the
Hon'ble Supreme Court after referring to various earlier
judgments has held that in fixing the market value of the
acquired land, which is undeveloped or underdeveloped, the
Courts have generally 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 was acquired. It has been held
that rule of 1/3rd deduction towards development appears to
be the general rule. The Hon'ble Supreme Court observed that
percentage of deduction for development of land to be made
in Delhi Development Authority is concerned, or similar
statutory authorities, with reference to various types of layout
was succinctly considered by the Court in “Lal Chand Vs.
Union of India and another ”, [(2009) 15 SCC 769] and
observing that the deduction towards the development ranges15
from 20% to 75% of the price of the plots, in paras 13 to 22,
the Hon'ble Apex Court held as under:-
“13. 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 developed plots, the
percentage depending upon the nature of
development of the layout in which the
exemplar plots are situated.
14. The “deduction for development” consists
of two components. The first is with reference
to the area required to be utilized 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 utilize around
40% of the land area in the layout, for roads,
drains, parks, playgrounds and civic
amenities (community facilities), etc.
15. The development authority will also
incur considerable expenditure for development
of undeveloped land into a developed layout,
which includes the cost of leveling the land,
cost of providing roads, underground
drainage and sewage facilities, laying water16
lines, electricity lines and developing parks
ands 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.
16. On the other hand, if the residential plot
is in an unauthorized private residential layout,
the percentage of “deduction for development”
may be far less. This is because in an
unauthorized layout, usually no land will be set
apart or parks, playgrounds 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 unauthorized layouts, would be only
about 20% plus 20% in all 40% as against 75%
in regard to DDA plots.
17. The “deduction for development” with
reference to prices of plots in authorized
private residential layouts may range
between 50% to 65% depending upon
the standards and quality of the layout.17
18. The position with reference to industrial
layouts will be different. As the industrial plots
will be large (say of the size of one or two acres
or more as contrasted with the size of
residential plots measuring 100 sq. m to 200 sq
m), and as there will be very limited civic
amenities and no playgrounds, the area to be
set apart for development (for roads, parks,
playgrounds and civic amenities) will be far
less; and the cost to be incurred for
development will also be marginally less, with
the result the deduction to be made from the
cost of an industrial plot may range only
between 45% to 55% as contrasted from 65%
to 75% for residential plots.
19. If the acquired land is in a semideveloped
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.
20. Therefore the deduction for the
“development factor” to be made with
reference to the price of a small plot in a
developed layout, to arrive at the cost of
undeveloped land, will be far more than the
deduction with reference to the price of a small18
plot in an unauthorized private layout or an
industrial layout. It is also well known that
the development cost incurred by statutory
agencies is much higher than the cost incurred
by private developers, having regard to higher
overheads and expenditure.
21. Even among the layouts formed by DDA,
the percentage of land utilized for roads, civic
amenities, parks and playgrounds may vary
with reference to the nature of layout-whether
it is residential, residential-cum-commercial or
industrial; and even among residential
layouts, the percentage will differ having
regard to the size of the plots, width of the
roads, extent of community facilities, parks and
playgrounds provided.
22. Some of the layouts formed by the
statutory development authorities may have
large areas earmarked for water/sewage
treatment plants, water tanks, electrical
substations, 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
17. In view of the above, I am of the considered view that
the deduction of 5% made by the learned Reference Court is
not proper. The deduction ought to have been at least to the
extent of 20%. Making deduction of 20% in the price of
` 742/-, market value becomes ` 593.60/- (rounded up to
` 594/-) per square metre. Hence, I fix the market value of
the acquired land in all the above cases at ` 594/- per square
metre.
18. In the result, all the appeals are partly allowed. Market
value of the acquired lands in all the said cases is fixed at
` 594/- per square metre. The applicants shall be entitled to
receive all the statutory benefits as also costs. The impugned
judgment and award stands modified to that extent.
19. Appeals stand disposed of accordingly.
U. V. BAKRE, J.
vn*
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