Holding

Compensation for fruit‑bearing trees must be assessed on a yield basis using the appropriate multiplier, and the High Court's award was set aside for fresh consideration.

Summary

The Kerala State Electricity Board (KSEB) cut several fruit‑bearing trees, including rubber, coconut, pepper vines, and mango trees, to lay a 220 kV transmission line. The landowners claimed compensation for loss of yield, future age of the trees, and interest, contending that the High Court's award was based on an incorrect multiplier and failed to apply established principles. The Supreme Court examined the High Court's methodology, noting that compensation for fruit‑bearing trees must be determined on a yield basis, with appropriate multipliers and consideration of factors such as situs, distance from the line, and land value. Citing KSEB v. Livisha (2007) and other precedents, the Court held that the High Court erred by using an 18‑year multiplier and not following the yield‑basis approach. Consequently, the Supreme Court set aside the High Court orders and remitted the matters to the Kerala High Court for fresh consideration in line with the cited principles. No order as to costs was made and the appeals were allowed.

Issues considered

What is the correct method for computing compensation for fruit‑bearing trees cut for a public utility project under the Land Acquisition Act?
Whether the High Court erred in applying an 18‑year multiplier instead of the appropriate multiplier for yield‑based compensation.
Whether factors such as situs, distance from the transmission line, and land value must be considered in determining compensation.

Legislation cited

Land Acquisition Act

Subjects

compensationfruit‑bearing treesland acquisitionyield basismultiplierelectricity lineKerala State Electricity BoardSupreme Courtremand

Judgment

[2008] 11S.C.R.431

KERALA STATE ELECTRICITY BOARD A
v.
C.P. SIVASANKARA MENON
(Civil Appeal No.4 702 of 2008)
JULY 29, 2008
B
[DR. ARIJLT PASAYAT AND DR. MUKUNDAKAM
SH~RMA, JJ.]

Compensation:
Compensation for fruit bearing trees - Computation of - C
Matter remitted to High Court for fresf] consideration keeping
in view the principles.set out by Supreme Court.
'

The instant appeals relate to compensation for valu-
ation of yield-of fruit bearing trees cut by the appellant
State Electricity Board. It was contended for the appel- D
lant that the relevant position in law was not kept in view_
by the High Court. -
Allowing the appeals, the Court
HELD: Following the view expressed by this Court E
in Livisha's case* the oraer of the High Court is set aside
and the matter is remitted to it for fresh consideration
keeping in view the principles set out in th~said deci-
sion. [Para 6] [434-D]
Qase Law Reference F
/

The Kera/a State Electricity Board v. Uvisha etc. etc.
(2007) 7 SCR 356 = 2007(6) SCC 792 followed. [Para 4]
- '
Kumba Amma v. K.SE.8~ 2000 (1) KLT 542 cited. [Para 4]
CIVILAPPELLATE JURISDICTION: Civil Appeal No. 4702 G
of 2008 . ~- ...
4- From the final JudgmeoW!Jld Order dated 6/1/2006 of the
High Court of Kerala at Eranakulam in CRP No. 434 of 2001'-'
~1 H
432 SUPREME COURT REPORTS [2008] 11 S.C.R.

A WITH
C.A. No. 4703/2008
M.T. Georg~ for the Appellant.
The Judgment of the Court.was delivered by
B
D_r. ARIJIT_.P~SAYATJ J. )-
S.L.P.(C) No.12436 and S.L.P.''(C) No. 12438 of 2006
1. Leave granted.
C· 2. Challenge in these appeals in each case is to the judg-
m_ent of a learned Single Judge of the Kerala High Court ·dis-
missing the Civil "Revision Petition filed·by:the .appellant. ln·the
civil _revision, petitipn, ch~llenge w~s to the order passed by
leafoed AdditlonaJ Di~trict JUdge·, No~h ~~ravur, \n O.P. (E!ec,.
D trlcity) N0':40/199"6 and 43/96. Several revision pefitions were
dis.posed of on the basis of an earlier decision cit the High C~ourt
in 'cR'P No:5o7 ot' 2061 by order dated'03.12}0_04-, . · ;;; ..
3. It is submitted by.learned coun.sel for the appellant that . '
the view of the High C,,urt is not correct The appell~nt-Board
. E cut down certain yieldrng rubber trees, 1·9 coconut trees, pep-
pet'vines; areci:niuttrees' and mango trees for the purpose· of
la'ying' down 220 kV electric line. The respondents were not :
satisfied·with the awarded amount as' determined for payment
as compensation. O.P. No.40/1996 in on'e case anci 43/1996
F · in the other case were filed.before the Trial Court claiming ad-
ditional compensation, which was allowed. The stand of the ,,I...·
appellant'in.thls case is that the r,elev.ant position in law was not
kept in vieiw by th~ High Court. The dispute rJiated to the com-·
pehsatio~ awarcfed for"valuation of the yield of the trees and
G · also.for the future age of the same and the grant of interest.
·.,. ' ""
4. In support of the appeal, learned counsel for the appel-
lant'.'.'.Board s.ubmitted that the High Court's judgment is clearly
unsustainab"le as the Full Bench decision of Kerala High Court.
H . in Kumba Amma v. K.S.E.B. (2000 (1) KLT 542) was set aside
KERALA STATE ELECTRICITY BOARD v. C.P. 433
SIVASANKARA MENON [DR. ARIJIT PASAYAT, J.]

by this Court in The Kera/a State Electricity Board v. Livisha A
etc. etc. [2007(6) sec 792) by the common judgment in Civil
Appeal No. 289 of 2006 and other Civil Appeals. This Court set
aside the impugned order in each case and remitted the mat-
ter back to the High Court for a fresh consideration. It was, in-
ter-alia, observed as follows: B
"10. The situs of the land, the distance between the high
voltage electricity line laid thereover, the extent of the line
thereon as also the fact as to whether the high voltage line
passes over a small tract of land or through the middle of
the land and other similar relevant factors in our opinion C
would be determinative. The value of the land would also
be a relevant factor. The owner of the land furthermore, in
a given situation may lose his substantive right to use the
property for the purpose for which the same was meant to
be used. D
11. So far as the compensation in relation to fruit-bearing
trees are concerned the same would also depend upon
the facts and circumstances of each case. We may,
incidentally, refer to a recent decision of this Court in Land
Acquisition Officer v. Kamadana Ramakrishna Rao (2007 E
(3) sec 526) wherein claim on yield basis has been held
to be relevant for determining the amount of compensation
payable under the Land Acquisition Act; same principle
has been reiterated in Kapur Singh Mistri v. Financial
Commr. & Revenue Secy. to Govt. of Punjab (1995 Supp. F
(2) SCC 635), State of Haryana v. Gurcharan Singh (1995
Supp. (2) SCC 637), para 4 and Airports Authority of India
v. Satyagopal Roy (2002 (3) SCC 527). In Airports Authority
it was held: (SCC p. 533, para 14)
G
"14. Hence, in our view, there was no reason for the
High Court not to follow the decision rendered by
this Court in Gurcharan Singh case and determine
the compensation payable to the respondents on
the basis of the yield from the trees by applying 8 H
434 SUPREME COURT REPORTS [2008] 11 S.C.R.

A years' multiplier. In this view of the matter, in our vLew,
"- the High Court committed error apparent in awardjng
compensation ad.opting the multiplier of 18."
12. We are, therefore, of the opinion that the High Court
should consider the. matter afresh on the merit of each
B matter having regard to the fact situation obtaining therein.
The-impugned judgments, therefore, cannot be sustained .
. These are set aside accordingly. The matters are remitted
. ,., to the High Gourt for consideration thereon afresh. The
appeals are allowed. In the facts and circumstances of the
c· case, there shall be no order as to costs."
·5. Th.ere is no appearance on behalf of the respondents in
each case though notice has been served.
6. Following the view.expressed by this Court in the deci-
D sions referred to above, we set aside the impugned order of
the High Court in each case and remit the matter to it for fresh
consideration keeping in view the principles set out in the deci-
si8n referred to above. · ... -- ·· ·
. 6.The appeals are allowed without any ord~r.as to costs.
E
n R.P._ Appeals allowed.