Holding

The Belting System is a judicially accepted method for determining fair market value of large, heterogeneous land parcels, and compensation must be based on comprehensive evidence rather than rates of small plots, leading to enhanced awards of Rs 45 lakh and Rs 35 lakh per acre.

Summary

The case concerned the acquisition of over 300 acres of land in Haryana for residential and commercial development under the Land Acquisition Act, 1894. The Collector determined compensation using the judicially recognised Belting System, fixing Rs 33 lakh per acre for land within two acres of the road and Rs 18 lakh per acre for interior land. The High Court upheld the front‑belt award but enhanced the interior‑belt award to Rs 24.75 lakh per acre. On appeal, the Supreme Court examined whether the Belting System was appropriate, whether rates from small‑plot sale deeds could be used, and what factors govern the fair market value under Section 23. It held that the Belting System is proper for large, heterogeneous parcels and that reliance solely on rates of tiny plots is impermissible. Accordingly, the Court enhanced compensation to Rs 45 lakh per acre for the front belt and Rs 35 lakh per acre for the interior belt, while affirming statutory solatium. The appeals were therefore partly allowed.

Issues considered

The appropriateness of applying the Belting System to determine market value of a large, non‑compact land acquisition.
Whether the highest rate from small‑plot sale deeds can be used as the basis for market valuation of the acquired land.
Whether the compensation awarded by the Collector and modified by the High Court complies with Section 23 of the Land Acquisition Act, 1894.
The factors and methodology to be considered in fixing the fair market value of land acquired compulsorily.

Legislation cited

Land Acquisition Act, 1894s. 18, s. 23, s. 4, s. 6

Subjects

Land acquisitionMarket value determinationBelting SystemCompensation enhancementSection 23Fair market valuePotentiality of landComparable sales

Judgment

[2017] 10 S.C.R. 534

A BIJENDER & ORS.
v.
STATE OF HARYANA & ANR.
(Civil Appeal No. 2846 of2017)
B OCTOBER 27, 2017
[R. K. AGRAWAL AND ABHAY MANOHAR SAPRE, JJ.]
Land Acquisition Act, 1894:
ss. 4, 6 - Land acquisition - Determination of market rates -
C Award of compensation - Enhancement - On facts, High Court
upheld the awards of the Land Acquisition Ojjlcer as regards
compensation @ Rs.33,00,0001- per acre for the land up to the
depth of 2 acres in the bye-pass and Gair Mumkin kind of land
whereas it enhanced the compensation from Rs.18, 00, 0001- per acre
D to Rs.24, 75,0001- per acre for the land beyond 2 acres - On appeal,
held: Acquired land was a large chunk of land having its frontage
abutting the road5ide - Courts below justified in applying Belting
System for determining the market rate - Further, it was neither
permissible and nor proper to rely solely upon the rates of small
plots and then determine the compensation for a large chunk of
E acquired land - Thus, taking into consideration all the relevant
factors-location of the acquired land, its s11rro11ndings, nature,
potentiality, rates of small plots, the purpose of acquisition,
development cost needed, non-availability of the sale deeds for large
areas sold in acres, etc., just, fair and proper market val11e of the
acquired land is determined at Rs.45,00,0001- per acre in place of
F
Rs.33,00,0001- per acre and Rs.35,00,(JOOI- per acre in place of
Rs.24,75,0001- per acre.
ss. 4, 6 - Land acquisition - Determination of market rates
by applying Belting System - Held: Where large pieces of land having
different locations are acquired, Belting System is considered
G apposite for determining the market value of the lands - In Belting
System, the acquired land is usually divided in two or three belts
depending upon the facts of each case - Market val11e of the front
belt abutting the main road is taken to fetch maximum value whereas
the second belt fetches two third or so of the rate determined in
H
534
BIJENDER & ORS. v. STATE OF HARYANA & ANR. 535

relation to the first belt and the third belt, fetches half or so of the A
maximum.
Land acquisition - Fair and reasonable market value of any
acquired land- Determination of- Guiding factors - Held: Is always
a question offact and its answer depends on the nature of evidence,
circumstances and probabilities appearing in each case. B
Land acquisition - Potentiali~v of the acquired land - Relevant
consideration, to be taken into consideration - Elucidated.
Partly allowing the appeals, the Court
HELD: 1.1 The Belting System is a judicially accepted c
method for determining the fair market value of the acquired
land. It is applied in appropriate cases when different parcels of
lands with different survey numbers belonging to different owners
and having different locations arc acquired which put together
comprises of a large chunk of land. Such chunk cannot be taken
as a compact block. Belting System is considered apposite for D
determining the market value of the lands. In Belting System,
the acquired land is usually divided in two or three belts depending
upon the facts of each case. The market value of the front belt
abutting the main road is taken to fetch maximum value whereas
the second belt fetches two third or so of l
the rate determined in E
relation to the first belt and the third belt, if considered proper to
carve out, fetches half or so of the maximum, depending upon
facts of each case. [Para 34-36] [545-F-H; 546-A, CJ
1.2 The question as to what is fair and reasonable market
value of any acquired land on the date of its acquisition, is always
F
a question of fact and its answer depends on the nature of evidence,
circumstances and probabilities appearing in each case. One of .
the guiding factors in such cases is the conduct of a hypothetical
willing vendor, who would offer the land and a willing purchaser
in normal human conduct, would be willing to buy the land as a
prudent man in normal market condition on the date of the G
notification under Section 4(1) of the Act but not an anxious buyer
dealing at arm's length nor facade or fictitious sales brought about
in quick succession or otherwise to inflate the market value.
When the Courts arc called upon to fix the market value of the
l!,rnd in compulsory acquisition, one of the types of evidence of H
536 SUPREME COURT REPORTS [2017] 10 S.C.R.

A the value of the property is the sale of the acquired land to which
the claimant is a party and in its absence, the sale of the
neighboring lands. The transactions relating to acquired land of
recent dates or in the neighbourhood lands that possessed of
similar potentiality or fertility or other advantageous features are
B considered to be relevant piece of evidence. In proof of the sale
transactions, the relationship of the parties to the transactions,
the market conditions, the terms of the sale and the date of the
sale arc to be looked into. These features need to be established
by examining either the vendor or vendee and if they are not
available, the attesting witnesses who have personal knowledge
C of the transaction etc. The original or certified copies of the sale
deeds arc required to be tendered in evidence to prove such
facts. One of the underlying principles to fix a fair market value
with reference to comparable sale is to reduce the clement of
speculation. [Para 37-41) (546-D-H; 547-A)
D 1.3 In comparable sale, the features arc-it must be within a
reasonable time of the date of the notification, it should be a bona
fide transaction, it should be a sale of the land acquired or land
adjacent to the land acquired and it should possess similar
advantages. These factors should be established by adducing
material evidence by examining the parties to the sale or persons
E having personal knowledge of the sale transactions. The proof
thereof focuses on the fact whether the transactions relied on
are genuine and bona fide transactions or not. It is the paramount
duty of the Courts of facts to subject the evidence to close scrutiny
with a view to objectively assess the evidence tendered by the
F parties on proper considerations thereof in its correct
perspective to arrive at a reasonable market value. The attending
facts and circumstances in each case always furnish guidance to
arrive at the market value of the acquired land. The
neighbourhood lands possessed of similar potentialities or same
advantageous features available in each case are also to be taken
G into account. [Para 42-44) [547-B-EJ
1.4 Indeed, it is held that the object of the assessment of
the evidence is to enable the Courts to arrive at a fair and
reasonable market value of the lands and in that process,
sometimes the Courts are required to trench on the border of
H
BIJENDER & ORS. v. STATE OF HARYANA & ANR. 537

the guesswork but mechanical assessment has to be eschewed. A
The Judges arc required to draw from their experience and the
normal human conduct of the parties as to which transaction is
bona fide and genuine sale transaction because that is one of the
guiding factors in evaluating the evidence. The amount awarded
by the Land Acquisition Collector forms an offer and that it is for B
the landowners to adduce relevant and material evidence to
establish that the acquired lands arc capable of fetching higher
market value and the amount offered by the Land Acquisition
Collector is inadequate and that he proceeded on wrong principle.
[Para 45-47] [547-F-H; 548-A)
Periyar & Pareekanni Rubbers Ltd. vs. State of Kera/a c
(1991) 4 sec 195 - relied on.
1.5 The question as to how the Courts should judge the
potentiality of the acquired land and what arc the relevant
consideration, which should be tak~n into consideration for
deciding the potentiality of the land, was also examined. The D
potentiality means capacity or possibility for changing or
developing into state of actuality. The question as to whether the
land has a potential value or not is primarily one of fact depending
upon its condition, situation, user to which it is put or is reasonably
capable of being put and whether it has any proximity to E
residential, commercial or industrial areas or institutions. The
existing amenities such as water, electricity, possibility of their
further extension, whether near about town is developing or has
prospect of development need to be taken into consideration.
The value of the smaller plots, which is always on ,the higher
side, is usually not taken into consideration for determining the F
large block of the land. One of the reasons being that the
substantial area of the large block is used for development of
sites like laying out the roads, drains sewers, water and electricity
lines and several civic amenities and to provide these facilities,
lot of time is consumed. The deduction is, therefore, made, which G
ranges from 20% to 50% or in appropriate cases even more.
[Para 48-50) (548-B-E]
Atma Singh (Dead) Thr. L.Rs. & Ors. vs. State of
Haryana & Anr. (2008) 2 SCC 568 : [2007] 12 SCR
1120 - relied on. H
538 SUPREME COURT REPORTS [2017] 10 S.C.R.

A 1.6 Keeping in view the nature, extent, size, surrounding
and location of the acquired land, the Courts below were justified
in applying Belting System for determining the market rate of
the acquired land. Since the acquired land was a large chunk of
land having its frontage abutting the roadside, the Belting System
B was rightly applied for determination of the fair market rate of
the land. It is more so because the appellants too did not raise
any objection before the courts below and nor they were able to
point out as to why it was not possible to apply the Belting System
and what was illegal in its application. [Para 33, 57-58] (545-E-F;
549-G]
c 1. 7 Out of 59 sale deeds, there are as many as 31 sale deeds
wherein the area comprises of less than 100 square yards. Except
two sale deeds where 60 and 67 square yard of land was sold for
Rs.4,500/- per square yard, all other sale deeds value ranges
betiveen Rs.200/- to Rs.2000/- per square yard. There can be no
D comparison between the two lands due to the extent of area which
are two extremes and since no sale deeds were filed by the
appellants showing market price of any large chunk of land sold
in acres at the relevant time, it is not possible to place reliance
on any of these sale deeds for determining the market rate of the
acquired land by applying the same rate (Rs.4,500/- per square
E yard). It is neither permissible and nor proper to rely solely upon
the rates of small plots and then determine the compensation for
a large chunk of acquired land. [Para 61] [550-D-F]
1.8 Taking into consideration all the relevant factors
emerging from the evidence and the findings of the courts below
F on the issues such as-the location of the acquired land, its
surroundings, nature, potentiality, rates of small plots, the purpose
of acquisition, development cost needed, non-availability of the
sale deeds for large areas sold in acres, etc., just, fair and proper
market value of the acquired land in question on the date of
G issuance of Section 4 notification is determined at Rs.45,00,000/-
per acre in place of Rs.33,00,000/- per acre for the lands described
in column 2 of the Award of the Collector and Rs.35,00,000/- per
acre in place of Rs.24,75,000/- per acre for lands described in
column 1 of the said Award. In addition the appellants are also
held entitled to statutory compensation as provided in the Act,
H
BIJENDER & ORS. v. STATE OF HARYANA & ANR. 539

which the courts below had already awarded to the appellants. A
The Award of such compensation is upheld. [Paras 62-63] (550--
G-H; 551-A-B, E]
Union of India & Ors. vs. Mangatu Ram & Ors. (1997)
6 SCC 59 : (1997] 3 SCR 1121; Andhra Pradesh
Industrial Infrastructure Corporation Limited vs. G. B
Mohan Reddy & Ors. (2010) 15 SCC 412 - referred
to.
Case Law Reference
(1997) 3 SCR 1121 referred to Para 35
-, (2010) 15 sec 412 referred to Para 35 c
(1991) 4 SCC 195 relied on Para 47
(2007) 12 SCR 1120 relied on Para 50
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2846
of2017.
D
From the Judgment and Order dated 22. 12.2015 of the High Court
of Punjab and Haryana at Chandigarh in RFA No. 5300 of2014.
WITH
C. A. Nos. 2916, 2917, 2912, 2915, 2955, 2951, 2853-2872, 2849,
2850, 2851, 284 7-2848, 2852, 2911, 2905, 2898, 2906, 2896, 2894, 2895, E
2899,2897,2888-2893,2878-2882,2883-2887,2873-2877,2900-2904,
2933-2950, 2907-2910, 2913-2914, 2918-2929, 2930, 2952-2954 and 2931-
2932of20I7
SLP (C) No. 29181-29197 of2016.
Nikhil Goel, P. S. Patwalia, ASG, B. K. Satija, AAG, Deepak F
Thukral, DAG, Neeraj Kumar Jain, Sr. Adv., Siddharth Jain, Sanjay Singh,
Pratham Kant, Ugra Shankar Prasad, Ujjal Singh, J. P. Singh (For
Mr. R. C. Kaushik), Dr. Surat Singh, Sudhansu Palo, Saurabh Agarwal,
Siddharth Batra, Ravinder Kumar, Parveen, Ajit Sharma, Ms. Savita
Devi, Punit Jain, Anand P. Jain, Deepak Goel, Bharat Bhushan, G
Ms. Varuna Bhand.ari Gugnani (For Dr. Kailash Chand), Aditya Singh,
Raj iv Dalal, Karan Kapoor, Manik Kapoor, Ritesh Khatri, A. Tiwari,
Ms. Eliza Bas, Purushottam Sharma Tripathi, Shreepal Singh, Saurabh
Sachdeva,Arun Tewatia, Sanjay Kumar Visen, Archit Upadhayay, Dhruv
Sheoran, Advs,. for the appearing parties.
H
540 SUPREME COURT REPORTS [2017] IO S.C.R.

A The Judgment of the Court was delivered by
ABHAY MANOHAR SAPRE, J. I. Leave granted in the special
leave petitions.
2. These appeals are directed against the common final judgments
and orders dated 22.12.2015, 22.03.2016 and 03.05.2016 passed by the
B High Court of Punjab and Haryana at Chandigarh in R.F.A. Nos.5300,
2807-2809,2806,4762,4764,4756,3751,3759,3760,3766,3768,3776,
3777,3785,3788,3794,3798,3800,3805,4839,4841,4842,4843,4844,
7299,8756,4840,4846,4838,3767,4757,4752,4746,4744, 7323,1515,
4753,5980,4751,4745,4809,2549,2548,5910,4810,4754,5911,5913,
c 5912,6307,6283,5542,5908,4747,4760,4758,4763,4759,6308,6309,
4748, 4749, 4755, 6306, 5909, 399912014, 314 & 809/2015, 3600, 2779,
4750,3762,3767,3791,3792,3795,3797,3801,4837,4838,4840,4845,
4846,4771,4766,4767,2778,2808,2940,2941,2942,2943,2945,2946,
3085,3120,3121,3997,3998,4000,4001,4003,5226,7214,4264,7253,
3988, 2547, 4263, 1516, 2771, 2772, 2773, 2774,2775, 2777, 3687,4307,
D 4416, 4417, 4418, 4419, 4421, 2776, 2778 & 4808/2014 whereby the
High Court while disposing of the said appeals partly allowed the appeals
and upheld the awards of the Land Acquisition Officer insofar as it
relates to assessment of compensation @ Rs.33,00,000/- per acre for
the land up to the depth of2 acres in Safidon-Jind Road, Safidon bye-
E pass and Gair Mumkin kind ofland whereas it enhanced the compensation
from Rs.18,00,000/- per ac.re to Rs.24,75,000/- per acre from for the
land beyond 2 acres.
3. Facts of the case are taken from C.A. No.2846of2017 (Bijender
& Ors. vs. State ofHaryana &Anr.) need mention, in detail, to appreciate
F the controversy involved in these appeals.
4. The land of the appellants measuring 18362 sq. yds. equivalent
to 30 kanal 07 maria being 1122/37/15 share out of total acquired land
measuring I 00 kanal 11 maria from the total land measuring 185 kanal
15 maria ofkhewat No.1396 khata nos.1658 and 1659 revenue estate of
G Safidon, situated at a village Saifdon, District Jind, Haryana was acquired.
The land was acquired for the development and utilization of commercial
and residential for HUDA Sectors 7, 8 and 9 in Safidon City in Distt.
Jind vi de three Notifications. Along with the land of the appellants, the
State also acquired land belonging to several landowners alike the
appellants.
H
BIJENDER & ORS. v. STATE OF HARYANA & ANR. 541
[ABHAY MANOHAR SAPRE, J. ]

5. Notification bearing No.LAC(H)-2007-NTLA/376 on A
23.08.2007 under Section 4 of the LandAcquisitionAct, 1894 (hereinafter
referred to as the "the Act") was issued for the acquisition of 142 acres
of land in village Singhpura, for public purpose, namely, for the
development of residential, commercial Sector 7, Safi don.
6. Notification bearing No.LAC(H)-2007-NTLA/379 on B
23.08.2007 under Section 4 of the Actwas issued for the acquisition of
249.49 acres land in villages Safidon, Singhpura, Rarnpura, Ratta Khera
and Khera Khemawati for public purpose, namely, for the development
ofresidential, commercial sector 8 at Safidon.
7. Notificatiotf bearing No.LAC(H)-2007-NTLA/382 on c
23.08.2007 under Section 4 oftheA'ctwas issued forthe acquisition of
167. 79 acres ofland in village Safidon, Khera Khemawati for the public
purpose, namely, for the development of residential and commercial sector
9 at Safidon. _,
8. The said notifications were published in the newspapers. The D
objection's to the said notifications were also invited. However, the
objections filed by the landowners were rejected by Collector finding no
merit therein under Section SA oftheAct.
9. This was followed by 3 <.jeclarations made and published under .
Section 6 of the Act on 21.08.2008 bearing No. LAC(H)-2008-NTLA/ E
423 in respect of the land measu_ring 74.10 acres of land in village
Singhpura, LAC(H)-2008-NTLA/426 in respect of the land measuring
199.57 acres ofland in village Safidon, Singhpura, Rampura, Ratta Khera
and Khera Khemawati and LAC{H)-2008-NTLA/429 in respect of the
land measuring 150.97 acres in village Safidon and Khera Khemawati.
F
10. The Collector held an enquiry. He applied the Belting System
for determining the market rate of land and, accordingly, classified the
land in parts. On 19.08.2010, the Collector passed 3 Awards. By Award
No.3 in respect of the land in village Singhpura, the Land Acquisition
Officer awarded compensation@Rs.33 lacs per acre for the land up to
the depth of 2 acres from Safidon-Jind Road and Safidon Bye-Pass G
Road and Gair Mumkin and for the land classified as "Nehri, Chahi", he
awarded Rs. 18 laes per acre. The landowners were also awarded 30%
solatium and additional amount@ 12% per annum from the date of
notification under Section 4 of theActtill the Award as provided under
Section 23 of the Act.
H
542 SUPREME COURT REPORTS [2017) 10 S.C.R.

A 11. By Award No.4 in respect of the acquisition ofland in village
Safidon, Singhpura, Rampura, Ratta Khera and Khera Khemawati, the
Land Acquisition Officer awarded compensation @Rs.33 lacs per acre
for the land up to the depth of 2 acres from Safidon-Jind Road and
Safidon Bye-Pass Road and Gair Mumkin and @ Rs.18 lacs per acre
for "Nehri, Chahi" Land. The landowners were also awarded 30%
B
Solatiumand additional amount@ 12% p.a. from the date ofnotification
under Section 4 of the Act till the award as provided under Section 23 of
the Act.
12. By Award No.5 in respect of acquisition of land in village
Safidon and Khera Khcmawati, the Land Acquisition Officer awarded
C compensation @ Rs.33 lacs per acre for the land upto the depth of 2
acres from Safidon-Jind Road and Safidon Bye-pass Road and Gair
Mumkin and Rs.18 lacs per acre for "Nehri, Chahi" land. The landowners
were also awarded 30% Solatium and additional amount @ 12% p.a.
from the date of notification under Section 4 of the Act till the Award as
D provided under Section 23 of the Act.
13. Being dissatisfied with the Awards, the landowners filed
Reference Petitions under Section 18 of the Act before the Additional
District Judge, Jind praying for enhancement of the compensation
contending inter alia that the market value of the land at the time of
E acquisition was much higher than what was offered by the Collector in
his Awards. According to the appellants (landowners), the market value
was to the tune of Rs.5000/- per sq. yds.
14. The Additional District Judge by its common Award dated
17.12.2013 dismissed all 305 reference petitions and, in consequence,
F upheld the Awards passed by the Collector. In other words, the Reference
Court was of the view that the rate at which the compensation was
determined by the Collector by applying the Belting System in working
out the compensation was just and p1:oper and as per Section 23 of the
Act. The Reference Court, therefore, did not enhance the compensation
awarded by the Collector. All the reference petitions were accordingly
G dismissed.
15. Aggrieved by the said Awards, the landowners filed separate
Regular First Appeals before the High Court praying for enhancement
of the compensation.

H
BIJENDER & ORS. v. STATE OF HARYANA & ANR. 543 -
[ABHAY MANOHAR SAPRE,'J. ]
- -

16. By impugned judgments dated 22.12.2015, 22.03.2016 and' A
03.05.2016, the High Court partly allowed the appeals. The High Court
held that the Awards ofthe Collector assessing compensation @Rs.33
lacs per acre for the land up to the depth of 2 acres on Safidem Jind
Road, Safidon bye-Pass road does not call for any interference and
hence they were upheld. However, so far as the other category ofland
B
(Nehri, Chahi) beyond 2 acres from the road wa~ concerned, the High
Co1:1rt modified the Award and enhanced the compensation from Rs.18
lacs to Rs.24,75,000/- per acre. The High Court determiried the market
rate at Rs. 48,40,000/- per acre and then reducing by 33% worked out to
Rs.32,42,80tl/- per acre, i.e., Rs.33,00,000/- per acre so far as Safidon-
Jind land was concerned. So far as other land for which the Collector C
had awarded- Rs.18 lacs per acre, the High Court deducted 25% and
thus worked out to Rs.24,75,000/- per acre. ·
17. Aggrieved by the said judgments, the landowners have filed
these appeals by way of special leave before this Court.
18. Heard learned counsel for the parties:'- D

19. Learned counsel appearing for the appellants (landowners)
while assailing the legality and correctness of the impugned judgments
mainly argued three points. ' ' ,
20. In the first place, learned counsel argued that the High Court E
having accepted in princ;iple that the acquired land is a developed land
and has potentiality in all respects coupled with the fact that it is surrounded
by upcoming activities in any town erred in not properly determining t!:te ·
market value of the land as required under Section 23 of the-Act read
with law laid down by this Comi in several case~.
F
· 21. In the second place; learned counsel argued that the appellants
(landowners) had filed as many as 59 Sale deeds of the-adjacent and _
nearby areas having a similar quality of land alike the acquired land
before the Reference Court. Learned counsel urged that o~t of 59 sale
deeds, two pieces ofland were sold at the rate of Rs.4,SOO/- per square
yard whereas remaining lands wer<:-also sold at different rates ranging G
between Rs.200/- to Rs.4,500/- per square yard.
I
22. It was, therefore, his submission that since the highest rate in
the comparable sal~s is usually preferred for determining the market
valu_e of the acquired land, the High Court should have taken Rs.4,500/-
H
544 SUPREME COURT REPORTS [2017] 10 S.C.R.

A per square yard to be the basis for determining the market value of the
acquired land.
23. In the third place, learned counsel argued that the Collector,
Reference Court and the High Cowi erred in applying the Belting System
for determining the market value of the acquired land which, according
B to learned counsel, wrongly resulted in classifying the acquired land in
two parts and, in consequence, resulted in applying two rates for two
parcels of the lands. One rate was for the land which is abutting the
main road, whose rate was more as compared to the other land, and the
land which is in interior from the main road, whose rate was less.
c 24. It was his submission that the Collector and the Reference
Court failed to give any justifiable reasons as to why they choose to
apply the Belting System for determining the market value of the acquired
land. Similarly, according to learned counsel, the High Court also did not
deal with this issue though raised by the appellants before the High Court
in their appeals.
D
25. In reply, learned counsel forthe respondent (State) supported
the impugned judgments and contended that the market value of the
acquired land determined by the High Court which resulted in partially
enhancing the rate in relation to one class of land which is in interior
from Rs.18 lacs to Rs.24,75,000/- per acre, is just and proper and does
E not call for any further enhancement and nor the other class of land
(Rs.33,00,000/- per acre) calls for any further enhancement and the
same was rightly upheld by the High Cow·t.
26. Learned counsel then pointed out several infirmities in the 59
comparable sale deeds relied on by the appellants and contended that
F these sale deeds should not be relied on for determining the market rate
of the acquired land for the following reasons.
27. First, all the 59 sale deeds pertained to very small pieces of
land wherein the lands were sold in square yards, whereas the acquired
land in question is very large and measures in acres (around 300 acres
G or so). In other words, according to learned counsel, there is no
comparison between the lands, which is the subject matter of the sale
deeds relied on by the appellants (claimants), and the acquired land in
question.
28. Second, some claimants, whose lands were acquired in these
H acquisition proceedings, had sold their part of the acquired lands in very
BIJENDER & ORS. v. STATE OF HARYANA & ANR. 545
[ABHAY MANOHAR SAPRE, J.]

small measures few months before the date of acquisition only with an A
intention to create evidence so that they may get the compensation for
their acquired land at the same rate at which they sold their land.
29. In other words, according to the learned counsel, such sales
could not be regarded as genuine sales between the seller and the buyer·
and were, in fact, the bogus sales brought into existence with a sole · B
purpose to claim more compensation for their acquired lands.
30. Learned counsel, lastly, contended that there is no case made
out by the appellants (landowners) to question the Belting System applied
by the Courts below for determining the market rates of the acquired
land inasmuch as having regard to the nature of the land and other factors, c
the Belting System was properly applied. Learned counsel, therefore,
contended that the impugned judgments deserve to be upheld calling no
interference.
31. Having heard the learned counsel for the parties and on perusal
of the record of the case, we arc inclined to allow the appeals in part D
and, in consequence, modify the impugned judgments by partially
enhancing the compensation payable to the appellants for their acquired
land to the extent indicated below. ·
32. Coming first to the question as to whether the Courts below
were justified in applying the "Belting System" for detc1mining the market E
rates of the acquired land in question?
33. We are of the considered opinion that keeping in view the
nature; extent, size, surrounding and location of the acquired land, the
Courts below were j ustificd in applying Belting System for determining
the market rate of the acquired land. F
34. One cannot dispute that the Belting System is a judicially
accepted method for determining th1e fair market value of the acquired
land. It is applied in appropriate cases when different parcels of lands
with different survey numbers belonging to different owners and having
different locations are acquired which put together comprises of a large G
chunk of land. Such chunk cannot be: taken as a compact block.
35. The acquired land having a frontage abutting the highway/
main road always has a better value a1s compared to the land, which is
away from the highway/main road. Indeed, farther the land from the
highway/main road, lesser the value of such land. In such a situation,
H
,,
546 SUPREME COURT REPORTS · [2017) 10 S.C.R.

A where large pieces oflandhavingdifferent locations are acquired, Belting
System is considered apposite for determining the market value of the
lands. (see - Union oflndia & Ors. vs. Mangatu Ram & Ors. 1997
(6) SCC 59 and Andhra Pradesh Industrial Infrastructure
Corporation Limited vs. G Mohan Reddy & Ors. 2010 (15) SCC
B 412).
36. In Belting System, the acquired land is usually divided in two
or three belts depending upon the facts of each case. The market value
of the front belt abutting the main road is taken to fetch maximum value
whereas the second belt fetches two third or so of the rate determined
in relation to the first belt and the third belt, if considered proper to carve
C out, fetches half or so of the maximum. It is again depending upon facts
of each case.
37. Similarly, this Court has consistently held on the question as to
what is fair and reasonable market value of any acquired land on the
date of its acquisition. It is held that such a question is always a question
D of fact and its answer depends on the nature of evidence, circumstances
and probabilities appearing in each case.
38. It is held that one of the guiding factors in such cases is the
conduct of a hypothetical willing vendor, who would offer the land and a
willing purchaser in normal human conduct, would be willing to buy the
E land as a prudent man in normal market condition on the date of the
notification under Section 4( 1) of the Act but not an anxious buyer dealing
at arm's length nor facade or fictitious sales brought about in quick
succession or otherwise to inflate the market value.
39. It is held that when the Courts are called upon to fix the market
F value of the land in compulsory acquisition, one ofthe_typcs of evidence
of the value of the prope11y is the sale of the acquired land to which the
claimant is a party and in its absence, the sale of the neighboring lands.
40. It is held that the transactions relating to acquired land of recent
dates or in the neighbourhood lands that possessed of similar potentiality
G or fertility or other advantageous features arc considered to be relevant
piece of evidence.
41. It is held that in proof of the sale transactions, the relationship
of the parties to the transactions, the market conditions, the terms of the
sale and the date of the sale are to be looked into. These features need
H to be established by examining either the vendor or vendee and if they
BIJENDER & ORS. v. STATE OF HARYANA & ANR. 547
[ABHAY MANOHAR SAPRE, J.]

are not available, the attesting witnesses who have personal knowledge A
of the transaction et~. The original or certified copies of the sale deeds
are required to be tendered in evidence to prove such facts. One of the
underlying principles to fix a fair market value with reference to
comparable sale is to reduce the element of speculation.
· 42. It is held that in comparable sale, the features are ( 1) it must B
be within a reasonable time of the date of the notification (2) it should be
a bona fide transaction (3) it should be a sale of the land acquired or
land adjacent to the land acquired and (4) it should possess similar
advantages.
43. These factors should be established by adducing material c
evidence by examining the parties to the sale or persons having personal
knowledge of the sale transactions. The proof thereof focuses on the
fact whether the transactions relied on are genuine and bona fide
·'
transactions or not.
44. It is further held that it is the paramount duty of the Courts of D
facts to subject the evidence to close scrutiny with a view to objectively
·assess the evidence tendered by the parties on proper considerations
thereof in its correct perspective to arrive at a reasonable market value.
The attending.facts and circumstances in each case always furnish
guidance to arrive at the market value of the acquired land. The
neighbourhood lands possessed of similar potentialities or same E
advantageous features/circumstances available in each case are also to
be taken into account.
45. Indeed, it is held that the object of the assessment of the
evidence is to enable the Courts to arrive at a fair and reasonable market
value of the lands and in that process, sometimes the Comts are required F
to trench- on the border of the guesswork but mechanical assessment
has to be eschewed.
46. It is also held that Judges are required to draw from their
experience and the normal human conduct of the parties as to which
transaction is bona fide and genuine sale transaction because that is G
one of the guiding factors in evaluating the evi.dence.
47. It is also held that the amount awarded by the Land Acquisition
Collector forms an offer and that it is for the landowners to adduce
relevant and material evidence to establish that the acquired lands are
capable offetching higher market value and the amount offered by the H
548 SUPREME COURT REPORTS [20l7] 10 S.C.R.

A Land Acquisition Collector is inadequate and that he proceeded on wrong
principle. (See - Periyar and Pareckanni Rubbers Ltd. vs. State of
Kerala 1991(4) SCC 195).
48. This Court also examined the question as to how the Courts
should judge the potentiality of the acquired land and what arc the relevant
B consideration, which should be taken into consideration for deciding the
potentiality of the land.
49. It is held that potentiality means capacity or possibility for
changing or developing into state of actuality. The question as to whether
the land has a potential value or not is primarily one of fact depending
c upon its condition, situation, user to which it is put or is reasonably capable
of being put and whether it has any proximity to residential, commercial
or industrial areas or institutions. The existing amenities such as water,
electricity, possibility of their further extension, whether near about town
is developing or has prospect of development need to be taken into
consideration.
D
50. It is also held that the value of the smaller plots, which is
always on the higher side, is usually not taken into consideration for
determining the large block of the land. One of the reasons being that
the substantial area of the large block is used for development of sites
like laying out the roads, drains sewers, water and electricity lines and
E several civic amenities and to provide these facilities, lot of time is
consumed. The deduction is, therefore, made, which ranges from 20%
to 50% or in appropriate cases even more. (Sec - Atma Singh(Dead)
Thr. L.Rs. & Ors. vs. State of Haryana & Anr. 2008 (2) SCC 568).
51. Keeping the aforementioned well settled principles of law in
F consideration, let us recapitulate the facts of the case hereinbelow to
examine the issue arising in the case.
52. As mentioned above, the total land acquired for development
and utilization of commercial and residential sector is situated in villages
Safidon, Singpura, Rampura, Ratta Khera & Khera Khemawati in District
G Jind in State of Haryana. The acquired land comprises of more than
around 300 acres or so and is thus a very large in chunk. The acquired
land belonged to several landowners and obviously so being so large in
volume. One side of the acquired land is abutting the road. The land has
surrounding with some kind of activities in nearby areas and this shows
H that the acquired land has some potential.
BIJENDER & ORS. v. STATE OF HARYANA & ANR. 549
[ABHAY MANOHAR SAPRE, J. ]

53. The Collector, therefore, taking into account all these factors A
considered it proper to classify the land on the basis of2004-2005 revenue
records in two heads for determining the compensation. The first head
was in the name Nehri Chahi . i.e., canalling irrigated/water supplied
from pipes in which land measuring 82-49 acres was included whereas
the other parcel ofland measuring around!. 17.08 acres, which is abutting B
the road, was included in other head in the name - To the depth of 2
acres from Safidon-Jind Road & Safidon bye pass Road and Gair
Mumkin. -(seeAward of the Collector dated 19.8.2010 (annexure P-3).
The Collector made this classification by applying the Belting System.
It is pertinent to mention that it was not objeCted by the landowners as
would be clear from Para 3 of the Award dated 19.8.2010. C
54. Since the land included under the head, i.e., Safidon- Jind Road
and Safidon Bye pass Road and Gair Mumkin was abutting the road, the
Collector fixed its market rate at Rs.33,00,000/- (Thirty Three Lacs)
per acre up to the extent of the land going inside 2 acres from the road.
55. So far as thcland included in the first head, i.e., Nehri- Chahi D
beyond 2 acres was concerned, the Collector fixed its market rate at
Rs.18,00,000/- (Eighteen Lacs) per acre.
56, The Reference Court dismissed the reference and upheld the
rates fixed by the Collector. The High Court, howevef, in an appeal filed
by the appellants (claimants), in the impugned judgments, upheld the E
rate, i.e., Rs.33,00,000/- per acre so far as it relates to the land included
in the-head. - Safidon - Jind Road and Safidon Bye pass Road and Gair
Mumkin saying that this docs not need any enhancement but enhanced
the rate from Rs.18,00,000/- per acre to Rs.24,75,000/- per acre insofar
as it pertained to land beyond 2 acres included in the head- Nchri Chahi. F
57. We are of the considered opinion that the Collector was
justified in applying the Belting System to the acquired land in question.
Since the acquired land was a large chunk of land having its frontage
abutting the roadside, the Belting System was rightly applied to the
acquired land for determination of its fair market rate. G
58. It is more so because we find that the appellants too did not
raise any objection before the Collector and before the High Court and
nor they were able to point out to us as to why it was not possible to
apply the Belting System an~ what was illegal in its application.
H
550 SUPREME COURT REPORTS [2017] 10 S.C.R.

A 59. It is for all these reasons, we find no merit in the submission
of the learned counsel for the appellants when he questioned the
application of the Belting System to the acquired land for determining its
fair market value.
60. This takes us to examine the next question as to whether the
B highest rate ofRs.4500/- per square yard of the land of the nearby area
out of 59 sale deeds should be made basis for determining the market
rate of the acquired land. In our opinion, it is not possible to accept this
submission of the learned counsel for the appellants though pressed in
service vehemently. ·
c 61. It is for the reason that firstly, the are.a sold in each sale deed
is very small as compared to the acquired land. Secondly, the lands
which were sold by these sale deeds is in square yards and ranges from
31.06 square yards to 440 yards whereas the acquired area in question
is in acres and comprises of more than 300 acres. Thirdly, out of 59 sale
deeds, there are as many as 31 sale deeds wherein the area comprises
D ofless than I 00 square yards. Fourthly, except two sale deeds where 60
and 67 square yard of land was sold for Rs.4,500/- per square yard, all
other sale deeds value ranges between Rs.200/- to Rs.2000/- per square
yard. Fifthly, there can be no comparison between the two lands due to
the extent of area which arc two extremes and lastly, since no sale
E deeds were filed by the appellants showing market price of any large
chunk ofland sold in acres at the relevant time, it is not possible to.place
reliance on any of these sale deeds for determining the market rate of
the acquired land by applying the same rate (Rs.4,500/- per square yard).
It is, in our opinion, neither permissible and nor proper to rely solely upon
the rates of small plots and then determine the compensation for a large
F chunk of acquired land as in this case.

62. We have applied our mind keeping in view all the relevant
factors coupled with the law laid down by this Court. Taking into
consideration all the relevant factors emerging from the evidence and
the findings of the Courts below on the issues such as - the location of
G the acquired land, its surroundings, nature, potentiality, rates of small
plots, the purpose of acquisition, development cost needed, non availability
of the sale deeds for large areas sold in acres, etc., we are of the
considered opinion that just, fair and proper market value of the acquired
land in question on the date of issuance of Section 4 notification is
H
determined at Rs.45,00,000/- (Forty Five Lacs) per acre in place of
BIJENDER & ORS. v. STATE OF HARYANA &ANR. 551
[ABHAY MANOHAR SAPRE, J. ]

Rs.33,00,000/- (Thirty Three Lacs) per acre for the lands described in A
detaiLin column 2 of the Award of the Collector .dated 19.08.2010
(Annexure P-3) at page 32 of the SLP paper book of C.A.No. 2846/
2017 and Rs.35,00,000/- (Thirty Five. Lacs) per acre in place of
Rs.24';75,000/- (Twenty Four Lacs Seventy Five Thousand) pe~ acre for
lands described in detail in column 1 of the said Award. In other words, B
the appellants arc held entitled to receive compensation for the acquir~,d
land as described hereunder: .·- ,, .

s. Class of Land Awarded
No. Amount
c
1. Nchri, Chahi Rs.35 lacs
2. To the depth of 2 Rs.45 lacs
acres from Safidon-
Jind Road & Safidon
Bye Pass Road and D
' Gair-mumkin land
.

63. In a.ddliion to the aforesaid, the appellants are also held entitled
to statutory compensation as provided in the Act and which the Courts
below had already awarded to the appellants. We uphold the Award of ,E --
such compensation. The two rates which we have determined above
would apply to entire acquired land of all the appellants.
64. In the light of foregoing discussion, the appeals succeed and
arc allowed in part. The impugned j udgmcnts arc partially modified in
appellants' favour by enhancing the compensation payable to appellants F
(claimants/landowners) in respect of their acquired land to the extent
Indicated above.

Nidhi Jain Appeals partly allow~d.
'·