CHATURBHUJA MODI AND ORS.versusSTATE OF ORISSA AND ANR.

                     [2010] 9 S.C.R. 849


             CHATURBHUJA MODI AND ORS.                           A
                              v.
              STATE OF ORISSA AND ANR.
              (Civil Appeal No. 940 of 2004)
                     AUGUST 11, 2010
                                                                 B
  [DR. MUKUNDAKAM SHARMA AND ANIL R. DAVE,
                             JJ.]

     Land Acquisition Act, 1894: Acquisition of large tract of
land - Compensation - Determination of market value - C
Comparable sale - Criteria for relying on sale deeds - Held:
Sale deed by which a very small piece of land was sold
cannot be made the basis for determining the market value
of the acquired land - Sale deed which was proximate to the
date of s.4 notification and a/so in geographical proximity to D
the acquired land can be made the basis - Where the market
value of large block of land is determined on the basis of sale ·
transactions for smaller property, appropriate deduction has
to be made for making allowance for the loss of the acquired
                 '
land required to    be used for internal development - The E
extent of area required to be set apart has to be assessed by
the court having regard to the shape, size and situation of the
concerned block of land - In the instant case, High Court
fixed the rate of the land at Rs. 3, 00, 0001- per acre after giving
some variations and discount, which in the light of evidence F
on record was just and proper.

    A Notification under Section 4 of Land Acquisition
Act, 1894 was published on 9.12.1982 proposing to
acquire land belonging to the appellants situated in
Cuttack, Orissa. The Land Acquisition Officer assessed            G
the market value of the land @ Rs.75,000 per acre. The
reference court enhanced the compensation to
Rs.1,50,000 per acre. Dissatisfied with the amount of

                              849                                 H
   850      SUPREME COURT REPORTS              [2010] 9 S.C.R.


A compensation, the appellants-landowners filed appeal
  before the High Court. They produced two sale deeds,
  Exhibit 1 dated 4.10.1982 and Exhibit 2 dated 17.4.1982.
  The High Court did not rely upon Exhibit 2. It, however,
  relied upon Exhibit 1 and enhanced the compensation to
B Rs.3,00,000 per acre. Still aggrieved, landowners filed the
  instant appeal.

         Dismissing the appeal, the Court

       HELD: 1.1. The criterJa which provide a good
C indication of whether a sale deed may be comparable to
  the one in question are: (1) it must be within a reasonable
  time. of date of notification under Section 4(1) of the Act;
  (2) it should be a bonafide transaction; (3) it should be
  sale_ of the land acquired or of the land adjacent to the
D one acquired; and (4) it should possess similar
  advantage. [Para 9] [855-G-H; 856-A]

       1.2. Exhibit 2 was a certified copy of registered sale
  deed dated 17.04.1982 by which a very small piece of
E land measuring only Ac. 0.003 decimals was sold at the
  rate of Rs. 9, 00,000/- per acre and therefore, it cannot be
  put up as a safe guide and basis for determining the
  market value of the acquired land which admeasured Ac.
  2.429 decimals. It also came in the evidence, which was
F relied upon by the civil court, that the purchaser of Exhibit
  2 had his own land adjoining the land covered under it
  and, therefore, he might be in dire necessity for
  purchasing the said land even at a higher price. The High
  Court, therefore, rightly kept Exhibit 2 sale deed out of its
  consideration. As regards the other sale deeds which
G were produced on behalf of the Land Acquisition Officer,
  namely Exhibits B to B/3, there was no evidence by the
  Collector indicating that the lands covered by the said
  sale deed transactions were in any manner comparable
  land with that of the land under acquisition. Therefore,
H
   CHATURBHUJA MODI AND ORS. v. STATE OF                851
                 ORI SSA
the said sale deeds also cannot be made the basis for           A
determining fair and reasonable market price of the land
acquired. [Paras 6-8] [854-E-H; 855-A-F]

    1.3. Although the land admeasuring Acre. 0070
decimals sold at the rate of Rs.5,50,000 per acre, under
                                                                8
the sale deed evidenced in Exhibit 1 was not an excellent
comparison in terms of area, the same indicated a sale
transaction completed at around the same time as the
acquisition of the said land. Moreover, Exhibit 1 also
concerned a plot that was in geographical proximity to
the acquired land. Reliance could be placed on the said         C
documentary evidence for determining and assessing the
compensation of the acquired land after giving the
necessary deduction. [Para 9] [856-A-C]

    1.4. While determining compensation, some                   D
conjecture is unavoidable as it is generally not possible
to have any documentary evidence of sale of land of
similar nature and in the near vicinity of the acquired land.
Where large tracts of land are required to be valued,
valuation in transactions with regard to small plots is not     E
to be taken as the real basis for determining the
compensation of large tracts of land. It follows that where
the market-value of large block of land is determined on
the basis of sale transactions for smaller property,
appropriate deduction has to be made for making
                                                                F
allowance for the loss of the acquired land required to be
used for internal development such as construction of
roads, drains, sewers, open spaces and the-expenditure
involved in providing other amenities like water,
electricity etc. The extent of area required to be set apart
has to be assessed by the court having regard to the            G-
shape, size and situation of the concerned block of land.
The High Court appeared to have taken notice o.f the
criteria and had given some discount in the
compensation amount as the land under Exhibit 1 was a
                                                                H
    852      SUPREME COURT REPORTS               [2010] 9 S.C.R.

A very small piece of land and the land acquired in the case
  in hand was much larger in size. After giving some
  variations and discount, the High Court fixed the rate of
  the land at Rs. 3,00,0001- per acre, which in the light of
  evidence on record, seems to be just and proper. [Paras
B 10-11] [856-E-H; 857-A-C]

        Administrator General of West Bengal v. Collector,
    Varanasi (1988) 2 SCC 150 - referred to.

                         Case Law Reference:
c         (1988) 2 sec 150       referred to           Para 10

         CIVIL APPELLATE JURISDICTION : Civil Appeal No. 940
    of 2004.

D       From the Judgment and order dated 12.09.2002 of the
    High Court of Orissa in First Appeal No. 300 of 1998.

          Ashok Panigrahi, Suvender S. Dash and Satya Mitra Garg
    for the Appellants.

E       Anukul Chandra Pradhan, Shiv Sagar Tiwari and Radha
    Shyam Jena for the Respondents.

          The Judgment of the Court was delivered by

       DR. MUKUNDAKAM SHARMA, J. 1. This appeal is
F directed against the judgment and order dated 12.09.2002
  passed by the High Court of Orissa at Cuttack. The appellant
  and the State filed three appeals before the High Court against
  the judgment and order dated 16.04.1998 passed by the
  learned Civil Judge (Senior Division), First Court, Cuttack in
G L.A. Case No. 3 of 1995. The said appeal arose out of a land
  acquisition proceeding pertaining to the land of the appellants
  - claimants herein.

      2. A notification under Section 4(1) of the Land Acquisition
H Act was published on 09.12.1982, proposing to acquire land
    CHATURBHUJA MODI AND ORS. v. STATE OF                    853
     'ORISSA [DR. MUKUNDAKAM SHARMA, J.]

of the appellants measuring 2.429 acres covered under Khata          A
No. 581 of Mouza - Bahar Bisinabar for construction of
additional building, office, garage and staff quarters of Orissa
State Financial Corporation, Cuttack. The Land Acquisition
Officer assessed the market value of the land at the rate of Rs.
75,000/- per acre. The appellants - claimants sought for a           B
reference to the learned Civil Judge as envisaged under
Section 18 of the Land Acquisition Act, and the Ld. Judge after
receiving evidence adduced by the parties, enhanced the
compensation to Rs. 1,50,000/- per acre. The appellants -
claimants being dissatisfied with the aforesaid determination        c
of compensation, filed an appeal before the High Court,
claiming a higher compensation at the rate of Rs. 12, 50,000/
- per acre. After appreciation of the evidence available on
record and relying primarily on the sale consideration in Exhibit
1, dated 06.10.1982, the High Court enhanced the                     0
compensation for the acquired land to Rs. 3,00,000/- per acre
and also he!d that the appellants should be entitled to other
statutory benefits as available under the Act.

     3. The appellants, still aggrieved, filed the present special
leave petition in this Court in which leave was granted after        E
which the appeal is listed for hearing. We took up the appeal
for hearing ,during the course of which we heard learned counsel
appearing i for the parties who i"1ave painstakingly taken us
through th~ evidence on record in support of their contentions.
                                                                     F
      4. Thi~ appeal is filed to prove and establish that the
acquired lartd is situated in the heart of the Cuttack City and
close to the National Highway No. 5. The land was acquired
for construction of additional building of O.S.F.C. for
accommodation of office etc. At the time of acquisition, other       G
commercial establishments like a cinema hall, hotel, etc. had
already come up near about the acquired land. The learfled
Civil Judge as well the High Court found that the acquired land
is not on the side of National Highway No. 5 but the same is
not very far away from the said Highway. It is also on record        H
    854     SUPREME COURT REPORTS                 [2010] 9 S.C.R.


A that the acquired land is a low-lying land and remains water-
  logged round the year. But the said fact could not belie the fact
  that the acquired land had great potential value. In order to
  assist the Courts to properly assess and determine the fair and
  reasonable market value, the parties adduced evidence, both
B oral and documentary.

        5. In this appeal, the parties have adduced limited
  evidence to establish their case. The records indicate that the
  appellants had filed two certified copies of the registered sale
C deeds, namely Exhibits 1 and 2, which were of course exhibited
  without objection from the respondent. Sale deeds were
  produced on behalf of the respondent - State and Land
  Acquisition Officer also, and they were exhibited as Exhibit B
  to B/3 but the same were marked as such with objection.
  Exhibit 1, which was produced by the appellants herein, is a
D certified copy of the registered sale deed dated 04.10.1982.
  Under the aforesaid sale deed, a total land of Acre 0.0070
  decimals in Baharbisinabar was sold for Rs. 40,000/~ i.e. at the
  rate of 22,500/- per gunth or Rs. 5,50,000/- (approximately) per
  acre.
E
       6. The other sale deed relied upon by the appellants -
  claimants is Exhibit 2, which is a certified copy of registered
  sale deed dated 17.04.1982 by which land measuring Ac.
  0.003 decimals was sold for Rs. 2,700/-. Exhibit 2 shows that
F a very small piece of land measuring only Ac. 0.003 decimals
  was sold at the rate of Rs. 9, 00,0001- per acre indicating its
  highly inflated value, which is established even when compared
  with Exhibit 1. Sale of such a tiny piece of land must have been
  for some specific object. The land which is acquired in the
G present case is a large tract of land, measuring Ac. 2.429
  decimals and therefore, Exhibit 2 cannot be put up as a safe
  guide and basis for determining the market value of the present
  acquired land. The High Court has therefore rightly kept said
  sale deed out of its consideration. It has also come in evidence,
H which is referred to and relied upon by the Civil Judge, that the
       CHATURBHUJA MODI AND ORS. v. STATE OF                     855
        ORISSA [DR. MUKUNDAKAM SHARMA, J.]
    purchaser of Exhibit 2 had his own land adjoining to the south      A
    of the land covered under it. Therefore, it appears that the
    purchaser was in dire necessity for purchasing the said land
    for the convenience of his own adjoining land. That being the
    position, the purchaser of the land in Exhibit 2 was even
    prepared to purchase the same at a higher value. Figures            B
    represented in sale deeds may not always be seen by Courts
    as a parameter of existing fair values. In that view of this
1   aspect, the assessed value of the acquired land is not
    comparable to the land mentioned in Exhibit 2.

          7. In so far as the evidentiary value of Exhibit 1 is         C
    concerned, the same is found to be proximate to the date of
    notification under Section 4(1) but under the said notification,
    another small piece of land measuring Ac. 0.070 decimals of
    land was also sold for Rs. 5,50,000/- per acre. The document,
    however, did not indicate whether the said land is in proximity     D
    to the acquired land or if the same is comparable to the land
    in question. By the aforesaid' sale deed, only a small piece of
    land was sold whereas the acquired land is a large tract of land.

         8. Other sale deeds which were produced on behalf of the ·'E
    Land Acquisition Officer, namely Exhibits B to B/3, were placed
    on record under objection. There is no evidence by the
    Collector indicating that the lands 1.~vered by the aforesaid sale
    deed transaction are in any manner comparable land with that
    of the land under acquisition. The land under the said sale ·F
    deeds are located in some other village whereas the acquired
    land is "Puratan Partita" in Kisan, but the land sold vide Exhibit
    B series are Bari in Kisan. Therefore, the said sale deeds also
    cannot be made as the basis for determining fair and
    reasonable market price of the land acquired.
                                                                       G
         9. The only evidence that could be considered and relied
    upon is Exhibit 1. The following criteria provide a good
    indication of whether a sale deed may be comparable to the
    one in question: (1) it must be within a reasonable time of date
    of notification under Section 4(1) of the Act; (2) it should be a   H
     856     SUPREME COURT REPORTS                  [2010) 9 S.C.R.


 A bonafide transaction; (3) it should be a sale of the land acquired
   or of the land adjacent to the one acquired; and (4) it should
   possess similar advantage. Although the land whose sale is
   evidenced in Exhibit 1 is not an excellent comparison in terms
   of area, the same indicates a sales transaction completed at
18 around the same time as the acquisition of the said land.
   Moreover, Exhibit 1 also concerns a plot that is in geographical
   proximity to the acquired land. There being no other evidence
   on record, and since we are not inclined to remand the matter
   after such a long delay, we would rely on Exhibit 1 with
 C necessary scrutiny and caution. Reliance could be placed on
   the said documentary evidence for determining and assessing
   the compensation of the acquired land after giving the
   necessary deduction.

         10. The High Court appears to have taken notice of the
 D aforementioned criteria and has given some discount in
   compensation as the land under Exhibit 1 is a very small piece
   of land and the land acquired in the case in hand is much larger
   in size. After giving the said discount, the High Court computed
   the compensation at the rate of Rs. 3,00,000/- per acre for the
 E acquired land. While determining compensation, some
   conjecture is unavoidable as it is generally not possible to have
   any documentary evidence of sale of land of similar nature and
   in the near vicinity of the acquired land. The value shown in
   Exhibit 1 cannot be assessed as the value of the acquired land
 F for the reason that the said land which is sold under Exhibit 1
   is a very small piece of land, whereas the acquired land being
   a large tract of land. This Court has held in Administrator
   General of West Bengal v. Collector, Varanasi, reported at
   (1988) 2 sec 150, that where large tracts of land are required
 G to be valued, valuation in transactions with regard to small plots
   is not to be taken as the real basis for determining the
   compensation of large tracts of land. It follows that where the
   market-value of large block of land is determined on the basis
   of sale transactions for smaller property, appropriate deduction
 H has to be made for making allowance for the loss of the
   CHATURBHUJA MODI AND ORS. v. STATE OF                    857
    ORISSA [DR. MUKUNDAKAM SHARMA, J.]
acquired land required to be used for internal development such    A
as construction of roads, drains, sewers, open spaces and the
expenditure involved in providing other amenities like water,
electricity etc. The extent of area required to be set apart has
to be assessed by the Court having regard to the shape, size
and situation of the concerned block of land.                      B

     11. After giving some variations and discount, the High
Court fixed the rate of the land at Rs. 3, 00,000/- per acre,
which in our considered opinion and in the light of evidence on
record, seems to be just and proper. Consequently, we dismiss      C
this appeal as we find no merit in it but without any cost.

D.G.                                       Appeal Dismissed.