Land Acquisition Officer, Saifabad vs Madhukar Rambhav Bhaskarwar and Others

P. Ramakrishnam Raju, J

Appeal Suit No.2413 of 1993 is filed by the Land Acquisition Officer; while Appeal Suit No.935 of 1994 is filed by the claimants.

The Land Acquisition Officer, Asifabad, issued a draft notification u/s 4(1) of the Land Acquisition Act, hereinafter called ''the Act'', on 13-1-1975 and a draft declaration u/s 6 of the Act on 9-12-1976 to acquire Ac.9-06 guntas of land situated in Survey Nos.75, 76, 83, 84 and 85 within the Municipal limits of Kagaznagar, but he failed to pass the award about a decade. Thereupon, the claimants filed Writ Petition No.3290 of 1986 before this Court for a direction to the Land Acquisition Officer to quash the earlier proceeding and to issue acquisition proceedings afresh. The High Court accordingly directed the Land Acquisition Officer to pass the award, but nothing happened. Thereafter, claimants moved contempt proceedings in the High Court against the Land Acquisition Officer in C.C.No.156 of 1988, wherein a direction was given to the Land Acquisition Officer by this Court to finalise the award proceedings and pay compensation to the claimants within four months. Then the Land Acquisition Officer issued a fresh notification u/s 4(1) of the Acton 13-2-1989 and passed the award on 1-8-1989 with God speed. He accordingly * awarded compensation at the rate of Rs.10,000/- per acre. Of course, it is the complaint of the claimants that the Land Acquisition Officer with a view to spite the claimants, since they have resorted to contempt proceedings, has passed the award for a niggardly sum against the said award, the claimants sought for reference u/s 18 of the Act, and the same was tried as OP.No.19 of 1990 by the learned Subordinate Judge Asifabad. He held that the market value of the land is not less than Rs.3-00 lakhs per acre. He, however, awarded compensation at the rate of Rs.2-00 lakhs per acre. Against the said decree and judgment, the Land Acquisition Officer preferred Appeal Suit No.2413 of 1993 and the claimants preferred Appeal Suit No.935 of 1994.

On behalf of the Land Acquisition Officer PW1 was examined and the award was marked. On behalf of the claimants four witnesses were examined as RWs.1 to 4 and marked Exs.Bl to B7 of which Exs.Bl to B6 are sale deeds. RWs land 2 are the claimants; while R.Ws 3 and 4 are parties to Exs.Bl and B3 sale deeds. As already stated Ex.B1 to B6 are the sale deeds between third parties and Ex,B7 is a sketch showing the location of the land.

While the appeals are pending, Kagaznagar Municipality claiming to be the beneficiary of the Land Acquisition proceedings, filed CMP No.9261 of 1994 for being impleaded as party-respondent in Appeal Suit No.2413 of 1993. After change of Commissioner in Kagaznagar Municipality, another application was filed in CMP Nb.21204 of 1997 to implead the Commissioner, Kagaznagar Municipality as the second appellant. CMP No.9261 of 1994 was ordered. CMP No.21204 of 1997 is pending. Arguments were also addressed on this application. We requested the learned Advocate-General to assist the Court on the scope of Section 50(2) of the Land Acquisition Act as to the maintainability of these applications in the appeal, and he accordingly addressed his arguments. These applications will be considered a little later.

Claimants also filed CMP No.4918 of 1998 to receive certain documents as additional evidence. Claimant-appellants maintained that they are entitled to compensation at the rate of Rs,3-00 lakhs as observed by the lower Court. According to the claimants, the lower Court has arrived at a clear finding that the market value of the land at the relevant time is Rs.3-00 lakhs. But, however, it finally enhanced compensation to Rs.2-00 lakhs only. The learned Advocate General as well as the learned Standing Counsel for Kagaznagar Municipality submitted that the compensation fixed by the lower Court at Rs.2-00 lakhs per acre is excessive and that the compensation as awarded by the Land Acquisition Officer is proper. Therefore, the question that falls for consideration is what is the market value of this land at the relevant time?

Draft notification u/s 4(1) of the Act was published on 13-2-1989, and therefore, the relevant date for purpose of determining the market value is 13-2-1989. RWs.1 and 2 are the claimants. They maintained that the market value of the land at the relevant time is more than Rs.3-00 lakhs. Ex.Bl is a registration extract of the sale deed dated 10-11-1988 in respect of a plot (30'' x 60'') sold by RW 4 for Rs. 12,000/-which comes to Rs.3-00 lakhs per acre. So also Ex.BS is another registration extract of the sale deed dated 12-3-1986, whereunder a plot admeasuring (22'' x 60") was purchased by RW3 for a sum of Rs.5,867/- which works out to Rs.2-00 lakhs per acre. RWs.4 and 3 respectively prove these sale deeds. However, the learned Advocate General as well as learned Standing Counsel for Municipalities submit that these sale deeds cannot be relied on as comparable sales since they are small pieces of land.

The land under acquisition is situated in ward Nos.14 and 15 of Kagaznagar Municipality which is an oldest Municipality. The land is useful for construction of shops for commercial use. Government Offices, Industrial, Commercial and Educational establishments are closeby to the land acquired. The acquired land is within the vicinity of Sirpur Paper Mill and Sir Silk Factory, Rice and Oil Mills, Schools, Colleges, Hospitals, Cinema halls etc. It is situated within a distance of one furlong from the Railway Station. There is no evidence contra that the land acquired is not useful for construction of houses, for commercial and other purposes. Though the land is registered as agricultural land, yet it is suitable for construction of houses as it is situated in Ward Nos. 14 and 15 of Kagaznagar Municipality. Having regard to the evidence on record, the lower Court in our view rightly came to the conclusion that the lands are sold at Rs.3-00 lakhs per acre at the relevant time and that the statement of PW1 which is based on his oral enquiry that the market value of the land is only Rs.8,000/- to Rs. 10,000/- per acre is a blatant lie. Therefore, taking Exs.Bl and B3 into consideration together with evidence of RWs 1 to 4 we are of the opinion that the market value of the land at the relevant time is not less than Rs 3-00 lakhs per acre.

Learned Counsel for the claimants subnets that the lower Court having recorded a finding that the market value of the land is Rs.3-00 lakhs, ought to have awarded compensation at the same rate. The lower Court in our view has rightly taken the fact that small extents were sold under Exs.B1 and B3 and therefore, some deduction must be made when a large extent is acquired towards infrastructure like roads and common amenities. So, viewed from this angle, we are satisfied that instead of Rs.3-00 lakhs as found under Ex.B1, sale deed, the lower Court has rightly fixed a sum of Rs.2-00 lakhs per acre as market value. Here again, learned Counsel for the claimants relying on the decision of the Supreme Court reported in Bhagwathula Samanna and others Vs. Special Tahsildar and Land Acquisition Officer, Visakhapatnam Municipality, , submits that when the land is already developed, question of making any deduction does not arise. As seen from the above case, the land referred to by the Supreme Court is already developed. It has roads, drainage facility electricity etc., as well as communications in the vicinity. In the absence of any evidence that the land was already developed, including laying of roads and other facilities, it cannot be said that no deduction should be made in respect of this land, hi the absence of reliable evidence on these the normal principle of making some deduction when compared to transactions relating to small extents of land, should be adopted without exception. In this view, we are supported by a decision of a Division Bench of this Court in Agrl Market Committee v. M.R.K. Chowdary, 1996 (4) ALD 629. Therefore, we are of the view that although small extents of land was sold in the vicinity at the rate of Rs.3-00 lakhs per acre, fixing market value at the rate of Rs.2-00 lakhs per acre, giving certain deductions for roads etc., is reasonable.

Learned Counsel for Kagaznagar Municipality submits that enhancement of compensation made by the reference Court is without any evidence. As already seen compensation awarded by the Land Acquisition Officer is most unreasonable. We have also seen that the compensation awarded by the Land Acquisition Officer is too niggardly and the compensation as awarded by the reference Court is based on evidence placed on record by the claimants. It is also submitted that as there was already an earlier notification u/s 4(1) of the Act made on 13-1-1975 in respect of the very same land, claimants have boosted the figures in order to claim enhanced compensation unjustly. This argument in our view has no substance. The claimants are not parties either to Exs B1 or B3. They are the sale deeds between third parties. Under these circumstances, it cannot be said that the claimants are responsible for those sale deeds. It is also not established that the claimants are behind these transactions. The land Acquisition Officer could not establish any connection even remotely, between the claimants and those sale transactions. Under these circumstances, it cannot be said that those sale deeds were brought into existence in order to boost up the compensation. As already seen, the land is situated in the midst of Municipal limits in ward Nos.14 and 15 and in a well developed area. Therefore, it cannot be said that those sale deeds were brought into existence by the claimants with an ulterior motive. Of course, the Municipality has prepared a lay-out of this land of Ac.9-06 guntas into 80 plots and 48 plots were sold in public auction for a sum of Rs.36,95,000/- in January, 1998 with a view to pay compensation to the claimants. Of course, we are not taking these figures into consideration for purpose of determining the market value of the land in the year 1989. This argument was advanced only to show that the Municipality has made enormous profit by acquiring this land.

As already seen, the Municipality has filed two applications to implead itself both as second appellant and as a respondent in Appeal Suit No.2413 of 1993. One application would be enough. Before ordering these applications, arguments advanced by the learned Advocate General have to be seen. The learned Advocate General placed before us a judgment of the Supreme Court reported in U.P Awas Evam Vikas Parishad Vs. Gyan Devi (Dead) by L.Rs. and another, etc. etc., . Their Lordships had an occasion to consider the scope of subsection (2) of Section 50 of the Land Acquisition Act, which is extracted below for ready reference.

"In any proceeding held before a Collector or Court in such cases the local authority or Company concerned may appear and adduce evidence for the purpose of determining the amount of compensation."

Provided that no such local authority or Company shall be entitled to demand a reference u/s 18.

A reading of Sub-section (2) of Section 50 no doubt clearly shows that the local authority or Company may appear and adduce evidence for the purpose of determining the amount of compensation. Therefore, it is clear that they are entitled to participate in a proceeding for acquisition of any land which is meant for their benefit and for which they have to pay compensation. However, the proviso restricts the scope of such a right. Proviso states that no such local authority or Company shall be entitled to demand a reference u/s 18 of the Act. The Supreme Court has considered the scope of this proviso and observed that Section 50(2) confers a right on the local authority to appear and adduce evidence to determine the market value of the land acquired. Therefore, it goes "without saying that local authority is entitled to a notice before compensation is determined. It is also observed that failure to give notice would result in denial of the said right of the local authority. Therefore, there cannot be any doubt that the local authority is entitled to notice and entitled to come on record. Accordingly, CMP No.9261 of 1994 is ordered, and the Commissioner, Kagaznagar Municipality, Adilabad District is already added as party respondent. The other CMP No.21204 of 1997 is dismissed as redundant.

The next question is what is the procedure to be adopted in this appeal in view of the fact that local authority had no notice either before the Land Acquisition Officer or before the reference Court at the time when compensation was determined.

The matter has reached the appellants stage without notice to the local authority and without any opportunity to it for adducing any evidence, although it is entitled to a notice and opportunity to adduce evidence. Would it be fair and just at this stage to set aside the judgment of the reference Court and the award and allow the local authority an opportunity to participate in those proceedings. We are of the opinion that this cannot be a proper course for a variety of reasons.

The local authority has not stated in j the affidavit filed by it that it has no notice while the award proceedings were pending or I the matter was pending before the reference I Court. It is not the case of the local authority that it was kept in dark. It is not even the complaint of the local authority that notice and opportunity were deliberately denied to it. On the other hand, in the application what all it prayed for is only to implead as a party to support the case of the Land Acquisition Officer and the award, as it is an affected party. Having regard to these averments, we are of the opinion that it is not the case of the local authority that it has suffered in any way for want of notice or opportunity. It is neither proper nor in the interest of justice to set aside the decree or award and remit it back. Further, the local authority has also not filed any independent appeal taking any ground that there was no notice or opportunity to it to adduce evidence before the reference Court or before the Land Acquisition Officer. Therefore, it is clear that what all it prayed is only an opportunity to implead itself as a party to the appeal filed by the Land Acquisition Officer and to support in the High Court. It has not even filed any material or any application for additional evidence to show that it has any material in support of its case. In this view, we get support from the a decision of the apex Court reported in Krishi Upaj Mandi Samiti v. Ashok Singhal, 1991 Supple.II SCC 419 wherein the Supreme Court merely remanded the matter to the High Court with a direction to afford hearing to the local authority and did not set aside the award of the reference Court although no notice was served by that Court to the local authority on the ground that the local authority has accepted and was satisfied with the award of the reference Court.

In a decision reported in Union of India (UOI) Vs. Sher Singh and Others, , when a piece of land was acquired for Union of India without making it a party, an application was filed by the Union of India to implead itself as a party to the proceeding before the reference Court. As the said application was dismissed, the Union of India approached the High Court unsuccessfully. However, the Supreme Court reversed the said order, allowed the application of Union of India for impleadment and observed that it is entitled to file an appeal in the High Court questioning the judgment of the reference Court. Similarly in Union of India Vs. Kolluni Ramaiah and others, , when compensation was enhanced in appeal by the High Court without impleading Union of India which is the beneficiary, Union of India challenged the judgment of the High Court in Supreme Court, and the Supreme Court set aside the judgment of the High Court, remanded the matter to the High Court with a direction that the SLP filed in the Supreme Court must be treated as Cross-Objections before the High Court against the Award of the Arbitrator. Following these decisions, we are of the view that the decree and Judgment of the reference Court need not be set-aside. Suffice it, if an opportunity is given to the local authority to dispute the correctness of the award or decree passed by the reference Court. As already seen, the local authority has not placed any material in order to show any error in the decree of the reference Court.

It is not a uniform rule of invariable application to set aside the decree or the award of the reference Court and the Land Acquisition Officer when there is no notice to the local authority, but it depends upon the facts and circumstances of each case. In a case like this when acquisition proceedings were initiated in the year 1989 and the proceedings are pending either before the Land Acquisition Officer, reference Court, or before the High Court and the local authority did not evince any interest to participate in the proceedings for quite a long time; what should be done.

It is not as if the local authority has no knowledge of the proceedings before the Land Acquisition Officer, or passing of the award, or the decree passed by the reference Court as well as pendency in the appear Record shows that EPs were filed number of times and time was taken for depositing the amount. With a view to realise some money and to pay the compensation amount, 48 out of 80 plots were sold by public auction by preparing a lay out of the land in question in the month of January, 1998. These facts show that the local authority has had knowledge and notice of the proceedings. Therefore, there would not be any justification for setting aside the award passed by the Civil Court merely to afford an opportunity to the local authority to participate in the proceedings.

Normally impleading a party is governed by the provisions of Order I, Rule 10 CPC which is a general procedure. The general procedure prescribed under CPC would not apply when mere is a procedure prescribed in any special enactment. As the Land Acquisition Act is a special enactment which prescribes procedure u/s 50(2) of the Act, the general procedure prescribed under Order 1, Rule 10 of CPC does not apply.

The learned Advocate General submits that the local authority is entitled to notice and adduce evidence if the matter is not finally concluded, as the local authority has to bear the burden of footing the bill, it can come on record. So, the question is when the Land Acquisition proceedings become final or get concluded.

In the context of rights of local authority when the matter is finally concluded would only mean the matter is finally settled after exhausting all remedies; in other words, dispute has attained quietus by not pursuing any further. Short of seeking a reference, local authority has all rights, including participation in the land acquisition proceedings before Collector as well as before the civil Court as well as filing an appeal if aggrieved by the decision of the civil Court.

Normally a matter becomes final and conclusive when it disposed of by the competent Court or Tribunal finally. It also gets finally decided when the order from which appeal is allowed and from which no appeal has been preferred or appeal has been preferred and dismissed. So also a revision so also an order becomes final from which no appeal or revision or review is allowed under law. Some times an order is challenged before the High Court under Article 226 of the Constitution or under Article 227 as the case may be on certain limited grounds of judicial review and when the order becomes final consequent to the said proceeding. When these tests are applied, the present land acquisition proceedings cannot be said to be finally concluded inasmuch as Statutory appeals are pending in the High Court. Therefore, the local authority is competent to be impleaded as a party to the appeals.

For all the above reasons, both the appeals are devoid of merits and they are accordingly dismissed, but in the circumstances, without costs.

Before parting with the case, we place on record our sincere appreciation for the assistance rendered by the learned Advocate General in disposing of these cases by his enlightened arguments the interpretation of sub-section (2) of Section 50 of the Land Acquisition Act.

CMP No.4918 of 1998 :

Claimants have also filed this application to receive paper publication dated 5-1-1998 issued by the Commissioner of Municipality, Kagaznagar and also public notice showing the plots in LP No.97/97 and mark them as Exs 8 and 9. There are filed to show that the Municipality has conducted public auction of the land acquired after dividing them into plots under the lay out plan and realised huge sums of money. These proceedings have come in to existence only in March, 1998 after the appeals are filed. Therefore, we do not find any relevancy of these proceedings. Even assuming that huge amount has been realised by selling the plots by the Municipality, it is not a circumstance to increase or enhance the compensation for the land acquired in the year 1988. The application for reception of documents is accordingly dismissed.