MANOHAR AND OTHERSversusTHE STATE OF MAHARASHTRA & OTHERS

                 [2025] 7 S.C.R. 1675 : 2025 INSC 900

                         Manohar and Others
                                  v.
                  The State of Maharashtra & Others
                      (Civil Appeal No. 9870 of 2025)
                                 28 July 2025
           [B.R. Gavai,* CJI and Augustine George Masih, J.]


                           Issue for Consideration
       Whether the impugned judgment passed by the High Court
       dismissing the First Appeals filed by the Appellants-farmers is
       sustainable or not.

                                  Headnotes†
       Maharashtra Industrial Development Act, 1961 – Land
       Acquisition Act, 1894 – Grant of compensation – Highest
       exemplar sale deed – Benefit of, ought to be given to the
       Appellants – Appellants’ land and other adjoining lands were
       acquired under the 1961 Act for the establishment of Jintur
       Industrial Area – LAO awarded compensation to the tune of
       Rs. 10,800/- per Acre – Appellants sought enhancement of
       compensation – Reference Court enhanced the compensation
       to Rs. 32,000/- per Acre however, ignored the highest exemplar
       sale deed showing market value of Rs. 72,900/- per Acre relied
       upon by the Appellants – First Appeal filed by Appellants,
       dismissed by High Court – Interference with:
       Held: When there are several exemplars with reference to similar
       land, usually the highest of the exemplars, which is a bona-fide
       transaction, will be considered – The highest exemplar sale
       deed showing market value of Rs. 72,900/- per Acre, available at
       Sr. No.4 and relied upon by the Appellants as a bona-fide sale
       instance was completely overlooked by the Reference Court –
       Though, the High Court recorded that the Reference Court
       considered in all ten exemplars and that it did not consider the
       sale instance at Sr. No.4 which is from Jintur, however, it took a
       diametrically opposite view that the Reference Court had considered
       the sale instance at Sr. No.4 since they are found nearby to the
       notification under the 1961 Act – Such finding recorded by the


* Author
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    High Court is erroneous – Impugned judgment not sustainable –
    Sale exemplar at Sr. No.4 is the most proximate to the date of
    transaction – Land of the Appellants was situated in a prime location
    and they deserve the benefit of the highest sale exemplar – However,
    on facts, the Reference Court rightly applied a deduction of 20% in
    the price determined – Thus, while accepting the sale exemplar at
    Sr. No.4, having market value of Rs. 72,900/- per Acre, a deduction
    of 20% i.e., Rs. 14,580/- per Acre is applied – Compensation
    granted to the Appellants enhanced from Rs. 32,000/- per Acre to
    Rs. 58,320/- per Acre with all other consequential benefits, as directed.
    [Paras 22, 25, 26, 28, 33, 50, 51]

    Land Acquisition Act, 1894 – Maharashtra Industrial
    Development Act, 1961 – Potential value of the land to be
    considered – Appellants’ land and other adjoining lands were
    acquired under the 1961 Act for the establishment of Jintur
    Industrial Area – Respondent No.3-Maharashtra Industrial
    Development Corporation contended that the Courts below
    rightly excluded the sale exemplar at Serial No. 4 on account
    of it being of an abnormally high value:
    Held: Contention rejected – The compensation payable to the owner
    of the land is determined by reference to the price which a seller
    might reasonably expect to obtain from a willing purchaser– Also,
    the land acquired has to be valued not only with reference to its
    condition at the time of notification u/s.4, LA Act but its potential
    value must be taken into account – Thus, the sale deeds of lands
    situated in the vicinity and the comparable benefits and advantages
    which they have, provide a ready method of computing the market
    value – In the present case, the sale exemplar at Sr. No.4 i.e., the
    sale instance dated 31st March 1990, is the most proximate to the
    date of transaction – Further, the sale instances at Sr. Nos.9 and
    10, from Jintur, show that after the notice under the 1961 Act, there
    has been a very high rise in the prices of the land in the nearby
    areas – Land of the Appellants was situated in a prime location and
    they deserve the benefit of the highest sale exemplar. [Para 41]

    Land Acquisition – Compensation – Method of computation –
    Plea of the Respondent No.3-Corporation that the Reference
    Court rightly used the principle of averaging of sale price of
    sale exemplars at Sr. Nos.1, 2, 3 and 5 for determination of
    market value of acquired land:
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       Manohar and Others v. The State of Maharashtra & Others


     Held: Not accepted – In the event, the values of the sale instances
     taken into consideration by the Reference Court had a “marginal
     variation”, averaging thereof would have been permissible – But,
     the sale exemplars taken into consideration by the Reference
     Court, were the ones from Sr. Nos.1 to 6 and they ranged from
     Rs. 25,000/- per Acre to Rs. 72,900/- per Acre – In such a case,
     the averaging thereof was clearly not permissible – Further,
     only because the Reference Court, without recording any
     reason, decided to completely overlook/omit the sale instance at
     Sr. No.4 and only took into consideration the sale instances at
     Sr. Nos.1, 2, 3 and 5, which are having value of Rs. 40,000/- per
     Acre, Rs. 41,000/- per Acre, Rs. 40,000/- per Acre and Rs. 40,000/-
     per Acre respectively; the averaging of these sale instances, having
     a marginal variation, could have been envisaged by the Reference
     Court – However, such an approach taken by the Reference Court
     was completely impermissible. [Paras 48, 49]

     Land Acquisition Act, 1894 – s.51A – Respondent No.3-
     Corporation contended that the Reference Court did not enter
     any finding that the sale instance at Sr. No.4 is a bona-fide
     transaction and it was justified in not considering the same
     as it reflected an unusually high rate:
     Held: The contention of the Respondent No.3 qua sale instance
     at Sr. No. 4 not being a bona-fide transaction is rejected on the
     basis of s.51A as per which the certified copy of a document
     can be accepted as evidence of transaction recorded in the said
     document – Further, though the Respondent State denied the
     correctness of the said documents, it did not lead any rebuttal
     evidence – Maharashtra Industrial Development Act, 1961. [Para 44]

                              Case Law Cited
     State of Punjab and Another v. Hans Raj (Dead) by LRs. Sohan
     Singh and Others [1994] 1 SCR 1008 : (1994) 5 SCC 734; Mehrawal
     Khewaji Trust (Registered), Faridkot and Others v. State of Punjab
     and Others [2012] 4 SCR 24 : (2012) 5 SCC 432; Mohammad
     Yusuf and Others v. State of Haryana and Others [2018] 3 SCR
     1075 : (2018) 16 SCC 105; Anjani Molu Dessai v. State of Goa
     and Another [2010] 14 SCR 997 : (2010) 13 SCC 710; Major
     General Kapil Mehra and Others v. Union of India and Another
     [2014] 10 SCR 1153 : (2015) 2 SCC 262; Shawal Singh (Dead)
     Through Legal Representatives v. Land Acquisition Collector,
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    Himachal Pradesh and Another (2016) 12 SCC 619 ; Nirmal Singh
    and Others v. State of Haryana Through Collector (2015) 2 SCC
    160 – referred to.

                               List of Acts
    Land Acquisition Act, 1894; Maharashtra Industrial Development
    Act, 1961.

                            List of Keywords
    Highest exemplar sale deed; Benefit of highest sale exemplar;
    Bona-fide transaction; Bona-fide sale instance; Highest sale
    exemplar most proximate to the date of transaction; Enhancement
    of compensation; Jintur Industrial Area; Jintur town; Land situated
    in a prime location; Nashik-Nirmal State Highway; Maharashtra
    Industrial Development Corporation; Farmers owners of land; Sale
    deeds of lands situated in the vicinity; High rise in prices of land
    in nearby areas; Method of computation of the compensation;
    Principle of averaging of sale price of sale exemplars; Marginal
    variation; Determination of market value of acquired land; Sale
    instances.

                           Case Arising From
    CIVIL APPELLATE JURISDICTION: Civil Appeal No. 9870
    of 2025
    From the Judgment and Order dated 21.04.2022 of the High
    Court of Judicature at Bombay at Aurangabad in FA No. 1179
    of 2008
    With
    Civil Appeal No(s). 9871 and 9872 of 2025

                        Appearances for Parties
    Advs. for the Appellants:
    Deshmukh Adith Satish, Bharat Thakorlal Manubarwala.
    Advs. for the Respondents:
    Ms. Rukhmini Bobde, Siddharth Dharmadhikari, Aaditya Aniruddha
    Pande, Ms. Soumya Priyadarshinee, Vinayak Aren, Amlaan Kumar,
    Naveen Kumar Bhardwaj, Ms. Shyamali Gadre, Soumik Ghosal,
    G Pal, Ashutosh Chaturvedi.
[2025] 7 S.C.R.                                                       1679

       Manohar and Others v. The State of Maharashtra & Others


                Judgment / Order of the Supreme Court

                                Judgment

     B.R. Gavai, CJI

1.   Delay condoned.
2.   Leave granted.
3.   The present batch of appeals challenge the common judgment and
     final order dated 21st April, 2022, passed by a learned Single Judge
     of the High Court of Judicature at Bombay, Bench at Aurangabad
     (hereinafter, “High Court”), whereby the First Appeals filed by the
     claimants/Appellants came to be dismissed.

     FACTS
4.   The facts, in brief, giving rise to the present appeals are as given
     below:
     4.1. The Appellants, in the lead matter, are farmers and were owners
          of land bearing Survey No. 103 and 104, admeasuring 16
          Hectare 79 Are situated at Village Pungala, Taluq and District
          Parbhani, Maharashtra.
     4.2. It appears that the land of the Appellants and other adjoining
          lands were sought to be acquired in the 1990s under the
          provisions of the Maharashtra Industrial Development Act, 1961
          (hereinafter, “Act of 1961”) for setting up an Industrial Area near
          Jintur town in Parbhani District.
     4.3. On 16th January, 1992, the Land Acquisition Officer & Deputy
          Collector, Hingoli (hereinafter, “Land Acquisition Officer”) issued
          a notice under sub-section (2) of Section 32 of the Act of 1961.
     4.4. On 6th December, 1994, the Respondent-State took possession
          of the Appellants’ land and an Award came to be passed by
          the Land Acquisition Officer. In terms of the said Award, the
          total area subject matter of the acquisition was 89 Hectares
          and 44 Are and the total compensation awarded was
          Rs. 45,70, 508/-.
     4.5. Being aggrieved by the quantum of compensation awarded,
          the Appellants accepted the compensation under protest and
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          simultaneously filed a Reference under Section 18 of the Land
          Acquisition Act, 1894 (hereinafter, “LA Act”) in the year 1997.
     4.6. Vide judgment and award dated 7th June 2007, in L.A.R. No.
          61 of 1997, the Court of Principal District Judge, Parbhani
          (hereinafter, “Reference Court”), partly allowed the reference
          with proportionate costs and directed the Respondent-State
          to pay the Appellants an amount of Rs. 46,26,013/- along with
          future interest @ 15% per annum from the date of award until
          the payment is made on the additional market value of Rs.
          16,43,224/-.
     4.7. Aggrieved still, the Appellants filed a First Appeal bearing No.
          1179 of 2008 before the High Court.
     4.8. Vide impugned judgment and final order, the learned Single
          Judge of the High Court dismissed the First Appeal.
     4.9. Being aggrieved thereby, the present appeals came to be filed
          by way of special leave.
     4.10. Vide order dated 22nd September, 2023, this Court issued notice
           on the application for condonation of delay in filing Special
           Leave Petition as well as on the Special Leave Petition.

     SUBMISSIONS
5.   We have heard Mr. Adith Satish Deshmukh and Mr. Bharat Thakorlal
     Manubarwala, learned counsel for the Appellants, Ms. Rukhmini
     Bobde, learned counsel for Respondent Nos. 1 and 2 and Ms.
     Shyamali Gadre, learned counsel for Respondent No. 3.
6.   Mr. Deshmukh and Mr. Manubarwala submitted that the Appellants
     are farmers, who lost their only source of sustenance and ever since
     are prosecuting their claim for fair, just and reasonable compensation
     based on the highest exemplar dated 31st March 1990. He further
     submitted that the Reference Court having found the highest exemplar
     sale to be a bona-fide transaction erred in ignoring the same without
     any reasoning. He, therefore, submitted that the finding of the High
     Court, that the Reference Court considered the highest exemplar
     sale deed, is contrary to the record.
7.   Mr. Deshmukh and Mr. Manubarwala submitted that Reference Court
     and High Court ought to have given benefit of the highest exemplar
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         Manohar and Others v. The State of Maharashtra & Others


      sale deed to the Appellants. He further submitted that the Courts
      having found that, the lands acquired in the acquisition are situated
      near T-point of Nashik-Nirmal State Highway adjacent to Jintur town
      which is a prime location with percolation tank just opposite to the
      lands with sufficient water, ought to have enhanced the compensation
      based on the highest exemplar sale deed dated 31st March, 1990.
8.    To buttress his submissions, the learned counsel for the Appellants
      placed reliance on the judgments of this Court in the cases of State
      of Punjab and Another v. Hans Raj (Dead) by LRs. Sohan Singh
      and Others,1 Mehrawal Khewaji Trust (Registered), Faridkot
      and Others v. State of Punjab and Others,2 Mohammad Yusuf
      and Others v. State of Haryana and Others,3 and Anjani Molu
      Dessai v. State of Goa and Another.4
9.    Per contra, Ms. Bobde appearing on behalf of the Respondent Nos.
      1 and 2 submitted that the Land Acquisition Officer had considered
      the sale instances of similar lands in the vicinity of the acquired lands
      and arrived at a proper valuation. She, accordingly, submitted that
      the compensation of acquired lands is fair and reasonable.
10. Ms. Gadre appearing on behalf of the Respondent No. 3 submitted
    that the Appellants owned dry crop land which was subject matter
    of acquisition by Maharashtra Industrial Development Corporation
    (hereinafter, “MIDC”). She submitted that before the Reference Court,
    the Appellants relied on ten sale exemplars and the sale exemplars
    at Serial Nos. 1 to 4 are pre-notification sale exemplars from Jintur
    town. She further submitted that considering the total area under
    acquisition by MIDC, the sale exemplars relied upon, being of an
    area less than 1 Hectare, are of small plots in Jintur town.
11. Ms. Gadre submitted that the Reference Court has not entered any
    finding that the highest exemplar sale deed dated 31st March, 1990, is
    a bona-fide transaction. She further submitted that the Reference Court
    was justified in not considering the highest exemplar sale deed dated
    31st March, 1990, showing market value of Rs. 72,900/- per Acre, as
    it reflected an unusually high rate. She further submitted that the sale


1    (1994) 5 SCC 734
2    (2012) 5 SCC 432
3    (2018) 16 SCC 105
4    (2010) 13 SCC 710
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     exemplars at Serial Nos. 8 to 10 show that even after the acquisition,
     the market value of land had not increased in the same proportion.
12. In support of her submissions, Ms. Gadre placed reliance on the
    judgments of this Court in the cases of Major General Kapil Mehra
    and Others v. Union of India and Another,5 Shawal Singh (Dead)
    Through Legal Representatives v. Land Acquisition Collector,
    Himachal Pradesh and Another,6 Anjani Molu Dessai (supra), and
    Nirmal Singh and Others v. State of Haryana Through Collector.7

     ISSUE FOR CONSIDERATION
13. On a perusal of the material placed on record, in light of the
    submissions advanced by the learned counsel appearing on behalf
    of the parties, the only issue that falls for our consideration is whether
    the impugned judgment and final order dated 21st April, 2022, passed
    by the High Court is sustainable or not?

     ANALYSIS
14. The land of the Appellants and other adjoining lands were acquired
    in the 1990s under the provisions of the Act of 1961 for setting up an
    Industrial Area near Jintur town in Parbhani District of Maharashtra.
    The Land Acquisition Officer, on 6 th December, 1994, awarded
    compensation to the tune of Rs. 10,800/- per Acre (or Rs. 27,000/-
    per Hectare). However, not being satisfied with the compensation
    awarded, the Appellants preferred a petition under Section 18 of
    the LA Act before the Reference Court, claiming enhancement of
    compensation determined by the Land Acquisition Officer.
15. On a perusal of the judgment and award passed by the Reference
    Court dated 7th June, 2007, it appears that the case of the Appellants
    was that the Land Acquisition Officer has not considered that the
    land in question is touching the outskirts of municipal limits of Jintur
    city and having non-agricultural potential. It was further their case
    that Village Pungala is only one kilometre away from Jintur city so
    the Appellants, being farmers, had a good market for selling their
    agricultural produce.


5   (2015) 2 SCC 262
6   (2016) 12 SCC 619
7   (2015) 2 SCC 160
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       Manohar and Others v. The State of Maharashtra & Others


16. It is pertinent to note that to substantiate their claim, the Appellants
    led evidence by way of affidavit. They placed on record the following
    sale instances:

      S. No.    Date of Sale      Name of     Area Sold Price per Acre
                   Deed            Village
         1.         28/04/1989     Jintoor        20 R        Rs. 40,000/-
         2.         22/05/1989     Jintoor        39 R        Rs. 41,000/-
         3.         22/05/1989     Jintoor        80 R        Rs. 40,000/-
         4.         31/03/1990    Jintoor         96 R        Rs. 72,900/-
         5.         28/05/1990     Wazur          20 R        Rs. 40,000/-
         6.         05/10/1990    Bhogaon         40 R        Rs. 25,000/-
         7.         11/02/1992    Panghari        11 R        Rs. 54,500/-
         8.         16/04/1992    Panghari        47 R        Rs. 18,000/-
         9.         31/12/1992     Jintoor        26 R        Rs. 61,500/-
        10.         06/03/1993     Jintoor        12 R        Rs. 60,000/-

17. It is further to be noted that though the Respondent-State denied
    the correctness of the above documents (sale instances), but no
    rebuttal evidence was placed on record by them.
18. After deciding the issue of limitation in the favour of the Appellants, the
    Reference Court found that the lands under acquisition are located at
    a short distance from Jintur town, which is a district headquarter; the
    purpose for which the lands were acquired was for development of
    Industrial Area and that the lands which were acquired were having
    non-agricultural potential. Further, the Reference Court found that
    the location of the lands is suitable for industrial units and that a
    water facility is available just adjacent to the lands.
19. From paragraph 28 onwards, the Reference Court has dealt with the
    most material piece of evidence placed on record by the Appellants
    viz., the sale instances as specified above in tabular form. The
    Reference Court observed that the material date on which the market
    value of land is to be determined will be 19th July, 1990, when firstly
    the notification under sub-section (2) of Section 32 of the Act of
    1961 was issued. The Court, accordingly, came to the finding that
    the sale instances prior to the aforesaid date of notification will be of
    relevance to the matter. Thereafter, the Reference Court observed
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     that the sale instances at Sr. Nos. 1 to 3 and 4 to 6 are prior to or
     nearby to the notification under the Act of 1961 and that the lands
     which are covered under the sale deeds are from Jintur town. The
     Court, therefore, came to the finding that the sale instances relied on
     by the claimants can be relied on and acted upon and that the sale
     deeds of lesser area of land can also be considered for determining
     the market value.
20. Pertinently, the Reference Court found that the claimants have
    placed on record certified copies of the sale deeds and that the
    same has got presumptive value under Section 51A of the LA Act.
    The Court further found that no rebuttal evidence has been led by
    the Respondent-State. Accordingly, the Reference Court came to
    the conclusion that the sale instances covered under the sale deeds
    came to be effected in due course of business in routine manner
    between willing purchaser and seller and, therefore, the transaction
    covered therein can be relied upon and acted upon to determine the
    market value of the land.
21. Surprisingly, after reaching till this point, the Reference Court in
    paragraph 31, while determining the price of the claimants’ land,
    came to the finding that since the price of land sold under the sale
    deeds at Sr. Nos. 1, 2, 3 and 5, was around Rs. 40,000/- per Acre
    i.e., Rs. 1,00,000/- per Hectare so by applying the deduction of
    20% in the price, the market value of dry crop land, at the time of
    acquisition, was ascertained as Rs. 32,000/- per Acre (or Rs. 80,000/-
    per Hectare) and the price of irrigated land, at the time of acquisition,
    was ascertained as Rs. 40,000/- per Acre (or Rs. 1,00,000/- per
    Hectare). In the result, compensation to be awarded for the land of
    the Appellants was enhanced to Rs. 32,000/- per Acre.
22. It can, therefore, be seen that the highest exemplar sale deed dated
    31st March, 1990, showing market value of Rs. 72,900/- per Acre,
    available at Sr. No. 4 and relied upon by the claimants as a bona-fide
    sale instance was completely overlooked by the Reference Court.
    It would, however, have been a different matter if the Reference
    Court, for reasons to be recorded by it, came to a finding that the
    sale instance at Sr. No. 4 was not a bona-fide one or a sham/bogus
    one which could not be relied upon.
23. Being aggrieved by the judgment and award of the Reference Court,
    the claimants/Appellants filed a First Appeal before the High Court.
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       Manohar and Others v. The State of Maharashtra & Others


     The learned Single Judge of the High Court, however, finding no
     error in the approach and/or outcome of the judgment and award
     passed by the Reference Court dismissed the batch of appeals filed
     by the claimants. Aggrieved thereby, the Appellants filed the present
     appeals by way of special leave.
24. To ascertain whether the impugned judgment and final order passed
    by the learned Single Judge of the High Court is sustainable or not,
    it would be apposite to refer to paragraphs 45-46 and 49-50 thereof,
    which read thus:
           “45. Now coming to the determination of the market value
           of the acquired lands and sale instances produced by
           the claimants. It is not in dispute that the acquired lands
           are situated at village Pungala. The compulsory land
           acquisition is made according to the Act of 1961 for the
           public purpose for establishment of Jintur industrial area.
           According to the evidence of claimants, village Pungala is
           at a distance of 2 k.m. away from Jintur, which is a taluka
           place, where the market committee, Wakhar Mahamandal,
           dairy business and other basic facilities are available. The
           oral evidence of claimants regarding distance in between
           the acquired land and Jintur town is not at all challenged
           by way of cross-examination initiated by the learned
           A.G.P. As such, there is no difficulty to accept the oral
           evidence produced by the claimants that the acquired
           lands are at a distance of 2 k.m. away from the Jintur
           town. Jintur is a town. There is a municipality and all
           the facilities are available. It is a taluka headquarter.
           46. It is material to note that the acquired lands are selected
           for acquisition. It is evident from the testimony of the
           claimants that the acquired lands are more convenient
           for the establishment of M.I.D.C. Jintur. Water facility
           is also available at a short distance from the acquired
           lands. The stock of evidence produced by the claimants
           regarding the proximity of the acquired lands with Jintur
           town coupled with facilities available and advantages is
           not any way challenged by way of cross-examination.
           Certainly, the argument advanced by the learned counsel
           for the M.I.D.C. that the acquired lands are at a distance
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        of 5 k.m. away from the Jintur town cannot be accepted.
        The claimants have also placed on record the documentary
        evidence in the nature of village map of Pungala and map
        of Jintur town in order to show the proximity. The learned
        reference Court has rightly considered the village map
        of Pungala and map of Jintur town and the location of
        acquired lands in para 11 of the impugned judgment. It is
        rightly held by the reference Curt (sic) that the acquired
        lands are adjacent to Jintur town. There are hills in
        between the lands and village Pungala and the acquired
        lands and they are near to Jintur town rather than from
        Pungala. The acquired lands are situated near T-point
        of Nashik-Nirmal State Highway. It is also observed
        by the reference Court that the acquired land has N.A.
        potentiality. The percolation tank is just opposite to
        the acquired lands, it has sufficient water. As such,
        selection of the acquired lands for acquisition for
        establishment of M.I.D.C. indicates their prime location
        as observed by the reference Court.
        …
        49. Now, the source which is available is exemplars,
        which are on record to determine the market value of
        the acquired lands. On going through the impugned
        judgments, it is noticed that the reference Court has
        considered in all ten exemplars as shown in para 10
        of the impugned judgment. However, not considered
        the sale instance at Sr. No. 4 dated 31.03.1990, which
        is from Jintur pertaining to 96 R land sold for the
        consideration of Rs. 72,900/-, which is found to be the
        highest sale instance in the chart. As pointed earlier,
        the market value of the acquired land is to be determined
        on the date of notification under Section 32 of the Act of
        1961, which is published in the Government gazette on
        19.07.1990.
        50. Even though the sale instance at Sr. No. 8 of the chart
        is from the village Pungala, it is of post notification and
        must be kept out for consideration. The reference Court
        has considered the sale instances at Sr. Nos. 1, 2, 3, 4
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       Manohar and Others v. The State of Maharashtra & Others


           and 6 since they are found nearby to the notification
           under Section 32(2) of the Act of 1961. In para No. 31
           of the impugned judgment, the reference Court has
           also considered the sale instance at Sr. No. 4 referred
           above. On going through para nos. 29 to 32 of the
           impugned judgment, it would be clear that the reference
           Court has rightly considered the sale instances at Sr.
           No. 1 to 3 and 4 to 6 for determination of market value.
           The reference Court has also rightly deducted 20% by
           considering the proximity of the land with Jintur town coupled
           with advantages and determined the market value of the
           acquired lands at Rs. 1,00,000/- per Hectare for irrigated
           lands and Rs. 80,000/- per Hectare for dry lands, which
           appear to be adequate and reasonable having regard to the
           location, geographical situation coupled with advantages and
           proximity to Jintur town and nearby rates. The exercise of
           determining the market value of the acquired lands made
           by the reference Court cannot be said to be erroneous.
           The reference Curt (sic) has attempted to award adequate
           compensation to the claimants, whose lands came to be
           acquired by way of compulsory acquisition for the industrial
           area of Jintur town. The reference Court has also awarded
           the statutory benefits available under the Land Acquisition
           Act, 1894 including solatium.”
                                                 (emphasis supplied)

25. It can thus be seen that though the High Court recorded, in paragraph
    49, that the Reference Court considered in all ten exemplars
    and that it did not consider the sale instance at Sr. No. 4 dated
    31st March 1990, which is from Jintur, in the immediate next paragraph
    i.e., paragraph 50, the High Court takes a diametrically opposite
    view that the Reference Court has considered the sale instance at
    Sr. No. 4 since they are found nearby to the notification under the
    Act of 1961. Not only that but the High Court, placing reliance on
    paragraph 31 of the judgment and award passed by the Reference
    Court, reiterated that it has considered the sale instance at Sr. No. 4.
26. Having already referred to paragraph 31 of the judgment and award
    passed by the Reference Court hereinbefore, we have no difficulty
    in holding that the finding recorded by the learned Single Judge of
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     the High Court in paragraph 50 of the impugned judgment and final
     order is erroneous.
27. The Reference Court having taken note of the ten sale exemplars
    ought to have dealt with the sale instance at Serial No. 4, however,
    it did not. That being the case, the High Court should have taken
    note of the same and taken into consideration the sale instance at
    Sr. No. 4, however, the High Court having clearly observed that the
    Reference Court did not take into consideration the sale instance at
    Sr. No.4, in paragraph 49, recorded an incorrect finding in paragraph
    50 by holding that the Reference Court took into consideration the
    sale instance at Sr. No. 4.
28. Taking note of the same, we have no hesitation in holding that the
    impugned judgment and order dated 21st April, 2022, is not at all
    sustainable.
29. Having come to the above conclusion, we could have very well
    remitted the matter back to the High Court for consideration afresh,
    however, taking into consideration the fact that the Appellants are
    farmers and that their land was acquired by the Respondent-State
    in the early 1990s, we are of the view that it would be appropriate
    that we ourselves consider the case of the Appellants as to whether
    they ought to be granted compensation on the basis of the highest
    exemplar sale deed dated 31st March, 1990, showing market value
    of Rs. 72,900/- per Acre.
30. In this respect, it will be appropriate to refer to the judgments of this
    Court relied upon by the learned counsel for the parties.
31. In the case of Anjani Molu Dessai (supra) this Court, while referring
    to two previous decisions of this Court, held thus:
          “20. The legal position is that even where there are
          several exemplars with reference to similar lands,
          usually the highest of the exemplars, which is a bona
          fide transaction, will be considered. Where however
          there are several sales of similar lands whose prices
          range in a narrow bandwidth, the average thereof
          can be taken, as representing the market price. But
          where the values disclosed in respect of two sales
          are markedly different, it can only lead to an inference
          that they are with reference to dissimilar lands or that
[2025] 7 S.C.R.                                                        1689

       Manohar and Others v. The State of Maharashtra & Others


           the lower value sale is on account of undervaluation
           or other price depressing reasons. Consequently,
           averaging cannot be resorted to. We may refer to two
           decisions of this Court in this behalf.
           21. In M. Vijayalakshmamma Rao Bahadur v. Collector
           [(1969) 1 MLJ 45 (SC)] , a three-Judge Bench of this Court
           observed that the proper method for evaluation of market
           value is by taking the highest of the exemplars and not
           by averaging of different types of sale transactions. This
           Court held: (MLJ pp. 46-47)
                “It seems to us that there is substance in the
                first contention of Mr Ram Reddy. After all
                when the land is being compulsorily taken
                away from a person, he is entitled to say that
                he should be given the highest value which
                similar land in the locality is shown to have
                fetched in a bona fide transaction entered
                into between a willing purchaser and a willing
                seller near about the time of the acquisition.
                It is not disputed that the transaction represented
                by Ext. R-19 was a few months prior to the
                notification under Section 4 that it was a bona fide
                transaction and that it was entered into between
                a willing purchaser and a willing seller. The land
                comprised in the sale deed is 11 grounds and was
                sold at Rs. 1961 per ground. The land covered by
                Ext. R-27 was also sold before the notification but
                after the land comprised in Ext. R-19 was sold.
                It is true that this land was sold at Rs. 1096 per
                ground. This, however, is apparently because of
                two circumstances. One is that betterment levy at
                Rs. 500 per ground had to be paid by the vendee
                and the other that the land comprised in it is very
                much more extensive, that is about 93 grounds
                or so. Whatever that may be, it seems to us to
                be only fair that where sale deeds pertaining to
                different transactions are relied on behalf of the
                Government, that representing the highest value
                should be preferred to the rest unless there are
1690                                                         [2025] 7 S.C.R.

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              strong circumstances justifying a different course.
              In any case we see no reason why an average
              of two sale deeds should have been taken in
              this case.”
         22. In State of Punjab v. Hans Raj [(1994) 5 SCC 734]
         this Court held: (SCC p. 736, para 4)
              “4. Having given our anxious consideration to the
              respective contentions, we are of the considered
              view that the learned Single Judge of the High
              Court committed a grave error in working out
              average price paid under the sale transactions
              to determine the market value of the acquired
              land on that basis. As the method of averaging
              the prices fetched by sales of different lands of
              different kinds at different times, for fixing the
              market value of the acquired land, if followed,
              could bring about a figure of price which may not
              at all be regarded as the price to be fetched by sale
              of acquired land. One should not have, ordinarily
              recourse to such method. It is well settled that
              genuine and bona fide sale transactions in
              respect of the land under acquisition or in
              its absence the bona fide sale transactions
              proximate to the point of acquisition of the
              lands situated in the neighbourhood of the
              acquired lands possessing similar value or
              utility taken place between a willing vendee
              and the willing vendor which could be
              expected to reflect the true value, as agreed
              between reasonable prudent persons acting
              in the normal market conditions are the real
              basis to determine the market value.””
                                               (emphasis supplied)

32. Next, in the case of Mehrawal Khewaji Trust (supra), this Court
    held thus:
         “17. It is clear that when there are several exemplars with
         reference to similar lands, it is the general rule that the
[2025] 7 S.C.R.                                                                 1691

       Manohar and Others v. The State of Maharashtra & Others


           highest of the exemplars, if it is satisfied that it is a bona fide
           transaction, has to be considered and accepted. When the
           land is being compulsorily taken away from a person, he is
           entitled to the highest value which similar land in the locality is
           shown to have fetched in a bona fide transaction entered into
           between a willing purchaser and a willing seller near about
           the time of the acquisition. In our view, it seems to be only
           fair that where sale deeds pertaining to different transactions
           are relied on behalf of the Government, the transaction
           representing the highest value should be preferred to the rest
           unless there are strong circumstances justifying a different
           course. It is not desirable to take an average of various
           sale deeds placed before the authority/court for fixing fair
           compensation.”
33. It can thus be seen that it is a settled position of law that when there
    are several exemplars with reference to similar land, usually the
    highest of the exemplars, which is a bona-fide transaction, will be
    considered. The same was reiterated in the judgment of this Court
    in the case of Mohammad Yusuf (supra).
34. The learned counsel for the Respondent No. 3 (MIDC), arguing in
    support of the impugned judgment and final order dated 21st April,
    2022, in addition to relying on the judgment of this Court in Anjani
    Molu Dessai (supra) referred to three other judgments of this Court.
35. Firstly, she relied on paragraph 20 of the judgment of this Court in
    the case of Kapil Mehra (supra), which reads thus:
           “20. Where the lands acquired are of different type and
           different locations, averaging is not permissible. But where
           there are several sales of similar lands, more or less, at
           the same time, whose prices have marginal variation,
           averaging thereof is permissible. For the purpose of
           fixation of fair and reasonable market value of any
           type of land, abnormally high value or abnormally
           low value sales should be carefully discarded. If the
           number of sale deeds of the same locality and the same
           period with short intervals are available, the average price
           of the available number of sale deeds shall be considered
           as a fair and reasonable market price.”
                                                    (emphasis supplied)
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36. It was sought to be contended that sale exemplar at Sr. No. 4 gave
    an abnormally high figure of Rs. 72,900/- per Acre and that this
    sale exemplar has rightly been excluded from consideration by the
    Courts below. Further, it was also contended that even the maximum
    increase in sale consideration in the later years i.e., till 1993 does
    not match up to the amount of sale exemplar at Sr. No. 4.
37. Secondly, relying on the judgment of this Court in the case of Shawal
    Singh (supra), specifically paragraph 7 thereof, it was sought to be
    contended by the learned counsel for Respondent No. 3 (MIDC) that
    the claimants/Appellants did not lead any evidence to show that the
    sale exemplar at Sr. No. 4 is a bona-fide transaction. Paragraph 7
    of Shawal Singh (supra) reads thus:
          “7. The decision of this Court in Mehrawal Khewaji Trust
          [Mehrawal Khewaji Trust v. State of Punjab, (2012) 5 SCC
          432 : (2012) 3 SCC (Civ) 177] with regard to highest rate
          of comparable sales is subject to certain well-defined and
          well-understood exceptions apart from the necessity of
          proving such sales to be bona fide as indicated in the
          decisions of this Court. The extent of the area transferred
          would certainly be a relevant factor which issue stands
          concluded by findings of fact recorded by the learned
          Reference Court.”
                                              (emphasis supplied)

38. Thirdly, relying on paragraph 20 of Anjani Molu Dessai (supra) which
    has been reproduced hereinbefore so also paragraph 18 of Nirmal
    Singh (supra), the learned counsel for Respondent No. 3 (MIDC)
    contended that the Reference Court has rightly used the principle of
    averaging of sale price of sale exemplars at Sr. Nos. 1 to 3 and 5 for
    determination of market value of the acquired land as the same is a
    well-established principle of law laid down by this Court in several
    cases. For ease of reference, paragraph 18 of Nirmal Singh (supra)
    is reproduced and it reads thus:
          “18. Keeping in mind the guidelines laid down by this Court
          in the catena of cases referred to supra, we are of the
          opinion to determine just and reasonable compensation
          for the acquired land on the basis of the sale instances
          as submitted by the appellants by taking the average
[2025] 7 S.C.R.                                                           1693

       Manohar and Others v. The State of Maharashtra & Others


           of the sale considerations mentioned therein that are
           relevant to the date of issue of notification under Section 4
           of the Act. However, the same is to be determined keeping
           in mind that developmental costs are higher for larger areas
           of land as compared to small portions of land. The rate
           of compensation must be subject to deductions towards
           developmental purpose that will have to be incurred by
           the respondent State.”
                                                (emphasis supplied)

39. Insofar as the contention of the learned counsel for Respondent No.
    3 (MIDC) that the Courts below rightly excluded the sale exemplar
    at Serial No. 4 on account of it being of an abnormally high value is
    concerned, we outrightly reject the said contention.
40. It is well-settled that the compensation payable to the owner of the
    land is determined by reference to the price which a seller might
    reasonably expect to obtain from a willing purchaser. It is further
    settled law that the land acquired has to be valued not only with
    reference to its condition at the time of notification under Section 4
    of the LA Act but its potential value must be taken into account. In
    this respect, the sale deeds of lands situated in the vicinity and the
    comparable benefits and advantages which they have, provide a
    ready method of computing the market value.
41. In the instant case, it is not in dispute that the land was acquired for
    public purpose for the establishment of Jintur Industrial Area. Further,
    the lands in question are situated at village Pungala, which is at a
    distance of 2 kilometres from Jintur, a taluka place and where the
    market committee, Wakhar Mahamandal, dairy business and other
    basic facilities are available. Not only that but the Courts below found
    that the lands acquired are situated near T-point of Nashik-Nirmal
    State Highway; that the acquired land has non-agricultural potential
    and that a percolation tank just opposite to the acquired lands, having
    sufficient water, could be found. It would also be relevant to note that
    the sale instances at Sr. Nos.1, 2 and 3 are of April/May of 1989
    and the notice under Section 32(2) of the Act of 1961 was issued
    on 19th July 1990, as such, the sale exemplar at Sr. No.4 i.e., the
    sale instance dated 31st March 1990, is the most proximate to the
    date of transaction. Further, the sale instances at Sr. Nos.9 and 10,
    from Jintur, show that after the notice under the Act of 1961, there
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     has been a very high rise in the prices of the land in the nearby
     areas. We are, therefore, of the considered opinion that the land of
     the Appellants was situated in a prime location and they deserve
     the benefit of the highest sale exemplar.
42. On the same lines, the contention of the learned counsel for the
    Respondent No. 3 (MIDC) that the maximum increase in the sale
    consideration in the later years (i.e., till 1993) does not match
    up to the amount of sale exemplar at Sr. No. 4 dated 31st March
    1990 is also liable to be rejected. It can clearly be seen from the
    aforementioned table that the sale instances at Sr. Nos. 9 and 10 are
    from Jintur and they reflect sale consideration of Rs. 61,500/- and
    60,000/- respectively, which are closer to the highest sale exemplar
    at Sr. No. 4 having value of Rs. 72,900/-, than they are to the sale
    instances at Sr. Nos. 1, 2, 3 and 5 which are having value of around
    Rs. 40,000/-.
43. Insofar as the contention of the learned counsel for Respondent
    No. 3 (MIDC) qua sale instance at Sr. No. 4 not being a bona-fide
    transaction is concerned, the same is also rejected on the basis of
    the provision contained in Section 51A of the LA Act as per which
    the certified copy of a document can be accepted as evidence of
    transaction recorded in the said document.
44. Further, it is clear from the judgment and award passed by the
    Reference Court that though the Respondent-State denied the
    correctness of above documents, it did not lead any rebuttal evidence.
    In light of the same, the contention of the learned counsel for
    Respondent No. 3 (MIDC) on this count is also rejected.
45. Finally, insofar as the contention of the learned counsel for the
    Respondent No. 3 (MIDC) qua the method of computation of the
    compensation is concerned, we are of the view that the same does
    not merit acceptance.
46. It was sought to be contended by the learned counsel for the
    Respondent No. 3 (MIDC) that the Reference Court has rightly used
    the principle of averaging of sale price of sale exemplars at Sr. No.
    1, 2, 3 and 5 for determination of market value of acquired land.
    However, it is clear from a reading of paragraph 20 of the judgment
    of this Court in the case of Anjani Molu Dessai (supra) that the
    legal position is that even where there are several exemplars with
[2025] 7 S.C.R.                                                       1695

       Manohar and Others v. The State of Maharashtra & Others


     reference to similar lands, usually the highest of the exemplars, which
     is a bona-fide transaction will be considered. Further, only where there
     are several sales of similar lands whose prices range in a narrow
     bandwidth, the average thereof can be taken, as representing the
     market price. The said position of law was reiterated in the judgment
     of this Court in the cases of Mehrawal Khewaji Trust (supra) and
     Mohammad Yusuf (supra).
47. Even in the case of Kapil Mehra (supra), relied upon by the learned
    counsel for Respondent No. 3 (MIDC), it has been held that where
    there are several sales of similar lands, more or less, at the same
    time, whose prices have marginal variation, averaging thereof is
    permissible.
48. The position of law being thus and further on account of the fact that
    the lands acquired in the present case are in a prime location, we are
    of the considered opinion that no occasion arose for the Reference
    Court to deviate from the well-settled position of law and that the
    claimants/Appellants deserve the benefit of the highest sale exemplar
    dated 31st March 1990. Not only that but in the event, the values of the
    sale instances taken into consideration by the Reference Court had a
    “marginal variation”, averaging thereof would have been permissible.
    But the sale exemplars taken into consideration by the Reference
    Court, in the present case, were the ones from Sr. Nos. 1 to 6 and
    they ranged from Rs. 25,000/- per Acre to Rs. 72,900/- per Acre.
    In such a case, the averaging thereof was clearly not permissible.
49. It is further to be noted that only because the Reference Court,
    without recording any reason, decided to completely overlook/omit
    the sale instance at Sr. No. 4 and only took into consideration the
    sale instances at Sr. Nos.1, 2, 3 and 5, which are having value of
    Rs.40,000/- per Acre, Rs.41,000/- per Acre, Rs.40,000/- per Acre
    and Rs.40,000/- per Acre respectively; the averaging of these sale
    instances, having a marginal variation, could have been envisaged
    by the Reference Court. We are, however, of the considered opinion
    that such an approach taken by the Reference Court was completely
    impermissible. Even in the case of Nirmal Singh (supra), relied upon
    by the learned counsel for Respondent No. 3 (MIDC), where this
    Court took the average of the sale considerations mentioned therein,
    the range of prices was in a narrow bandwidth. The contention of
    the learned counsel for Respondent No.3 (MIDC) qua the method
    of computation of the compensation is, therefore, also rejected.
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50. Having held thus, we, however, cannot lose sight of the aspect that
    the ten sale exemplars placed before the Reference Court by the
    claimants/Appellants are of small plots of land in Jintur town, each
    of them being less than 1 Hectare. The Reference Court, therefore,
    correctly came to the conclusion that while accepting the sale
    instances a reasonable reduction requires to be made. As such, the
    land which is acquired being much larger in area, the Reference
    Court applied a deduction of 20% in the price determined. Being
    in agreement with the same, while accepting the sale exemplar at
    Sr. No. 4 dated 31st March 1990, and having market value of Rs.
    72,900/- per Acre, we deem it appropriate to apply a deduction of
    20% i.e., Rs. 14,580/- per Acre.
51. In the result, we pass the following order:
     i.      The present batch of appeals are allowed;
     ii.     The judgment and final order dated 21st April, 2022, passed
             by the learned Single Judge of the High Court is quashed and
             set aside;
     iii.    The judgment and award dated 7th June, 2007 passed by the
             Reference Court is quashed and set aside;
     iv.     We direct that the compensation granted to the Appellants
             be enhanced from Rs. 32,000/- per Acre to Rs. 58,320/- per
             Acre; and
     v.      We further direct that all other consequential benefits of solatium
             and interest on the enhanced compensation in terms of Section
             23(1-A), 23(2) and 28 of the Land Acquisition Act, 1894, be
             granted to the Appellants.
52. Pending applications, if any, are disposed of.

     Result of the case: Appeals allowed.



     †
         Headnotes prepared by: Divya Pandey