Nitai Chandra Saha And Anr. vs Land Acquisition Collector And Anr.

This is an appeal under Section 54 of the Land Acquisition Act, 1894 which arises from the judgment and award dated 30.05.2013 delivered in Misc. (LA) No.152 of 2010. By the said judgment dated 30.05.2013, the Land Acquisition Judge has enhanced the rate of the acquired land from Rs.8,00,000/- to Rs.24,85,000/- for the land classified as 'pukur and pukur par' [pond and its embankment] and from Rs.12,00,000/- per kani to Rs.32,52,000/- per kani for the land classified as bastu (nal) class of land. Since the appellants are not satisfied with the said determination, they have preferred this appeal to enhance the rate further in terms of their claim as raised before the Land Acquisition Collector.

The essential facts that would be required for appreciation of the challenge may be introduced at the outset. By notification under No.F.9(2)-REV/ACQ/VI/085 dated 22.01.2008 [under Section 4 of the Land Acquisition Act] followed by the statutory declaration dated 21.04.2008 [under Section 6 of the said act therefrom], pieces of land from the appellants were acquired for purpose of construction of the Integrated Development Complex at Agartala Land Customs Station at the Akhaura Check Post, Agartala. There is no controversy that the land measuring 0.12 acre of 'pukur' (nal) class under plot No. 4275 the land measuring 0.055 acre 'pukur par' (nal) class under the plot No.4274/10463, both are pieces under Khatian No.4190, and a further piece of land measuring 0.07 acre of bastu (nal) class under Plot No.4276/10404 under Khatian No.4191 were acquired for the said purpose. The LA Collector by his award determined the rate as stated above. Since the appellants were not satisfied, they pressed for a reference under Section 18 of the Land Acquisition Act. The reference, as made under Section 18 of the LA Act, being Misc. (LA) No.152 of 2010 has been determined by the impugned judgment dated 30.05.2013 by increase in the rate as stated above. The Land Acquisition Judge in support of the said increase has observed as under:

"10. In the case in hand, the sole sale deed proved from the side of the claimants relates to bastu (nal) class of land. On the other hand, sale deeds proved from the side of the OP relate to nal class of land. All the sale deeds being relating to land surrounding the acquired land, in my opinion it would be appropriate to select the sale deed marked exhibit-2 as the exemplar for bastu (nal) class of the acquired land which is done accordingly. As regards the nal class of land, in the light of the judgment above referred, the highest price should be selected as the exemplar. Accordingly, sale deed no.1-6923 dated 20.06.2005 is selected. In this transaction 0.04 acre of land was sold at the rate of Rs..10,00,000/- per kani.

We would now, refer to Para-12 of the judgment of the Apex Court in Administrator General of West Bengal vs. Collector, Varanasi reported as (1988) 2 SCC 150 at Paragraph-12 has observed as follows:

"12. It is trite proposition that prices fetched for small plots cannot form safe-bases for valuation of large tracts of land as the two are not comparable properties. (See collector of Lakhimpur v. B.C. Hydrabad, Padma Uppal v. State of Punjab, Smt. Kaushalya Devi Bogra vs. Land Acquisition Officer, Aurangabad). The principle that evidence of market- value of sales of small, developed plots is not a safe guide in valuing large extents of land has to be understood in its proper perspective. The principle requires that prices fetched for small developed plots cannot directly be adopted in valuing large extents. However, if it is shown that the large extent to be valued does not admit of and is ripe for use for building purposes; that building lots that could be laid-out on the land would be good selling propositions and that valuation on the basis of the method of a hypothetical lay-out could with justification be adopted, then in valuing such small, laid-out sites the valuation indicated by sale of comparable small sites in the area at or about the time of the notification would be relevant. In such a case, necessary deductions for the extent of expenses of development of the sites by laying out roads, drains, sewers, water and electricity lines and the interest on the outlays for the period of deferment of the realization of the price; the profits on the ventures etc. are to be made. In Sahib Singh Kalta & Ors. v. Amritsar Improvement Trust and Ors., (See 1982 1 SCC 419, this court indicated that deductions for land required for roads and other developmental expenses can, together, come-up to as much as 53%. But the prices fetched for small plots cannot directly be applied in the case of large areas, for the reason that the former reflects the 'retail' price of land and the latter the 'wholesale' price."

Since in the case in hand, quantum of land in the exemplar is 1 ganda, 2 kara, 2 kranta and 3 dhur and the acquired bastu (nal) land measures 0.07 acre i.e. 3 and ½ ganda, the rate per kani in the exemplar can be taken into consideration without making any deduction which is accordingly taken. The sale deed in question being executed on 28.06.2006 and the notification in question being made on 22.01.2008, in the light of the decision rendered by the apex court in General Manager ONGC Ltd. Vrs. Ramesh Bhai Jivan Bhai & another reported as 2008 AIR SCW 5947, there shall be some addition to the rate in view of price escalation. It would be appropriate to refer to Para-11 of the judgment here which runs as follows:

"......11. Primarily, the increase in land prices depends on four factors - situation of the land, nature of development in surrounding area, availability of land for development in the area, and the demand for land in the area. In rural areas unless there is any prospect of development in the vicinity, increase in prices would be slow, steady and gradual, without any sudden spurts or jumps. On the other hand, in urban or semi-urban areas, where the development is faster, where the demand for land is high and where there is construction activity all around, the escalation in market price is at a much higher rate, as compared to rural areas. In some pockets in big cities, due to rapid development and high demand for land, the escalations in prices have touched even 30% to 50% or more per year, during the nineties. On the other extreme, in remote rural areas where there was no chance of any development and hardly any buyers, the prices stagnated for years or rose marginally at a nominal rate of 1% or 2% per annum. There is thus a significant difference in increases in market value of lands in urban/semi- urban areas and increases in market value of lands in the rural areas. Therefore if the increase in market value in urban/semi-urban areas is about 10% to 15% per annum, the corresponding increases in rural areas would at best be only around half of it, that is about 5% to 7.5% per annum. This rule of thumb refers to the general trend in the nineties, to be adopted in the absence of clear and specific evidence relating to increase in prices. Where there are special reasons for applying a higher rate of increase, or any specific evidence relating to the actual increase in prices, then the increase to be applied would depend upon the same."

In the case in hand, the acquired land is admittedly located in semi-urban areas and according to the judgment aforesaid, the increase in the market value is to be treated between 10% to 15% but since in the judgment aforesaid the period considered was nineties and since we are dealing with a case of the year 2008, the percentage increased may be taken as around 30%. The exemplar sale deed was executed on 26.06.2006 and notification u/s 4 was published on 22.01.2008. Now, to calculate the percentage increase it would be appropriate to refer to Para-17 of the General Manager ONGC Ltd. Vrs. Ramesh Bhai Jivan Bhai & another (Supra) which runs as follows:

"17. The reference court has stated that the gap between 6.1.1987 (the date of transaction covered by Ex.P15) and 15.9.1992 (the date of acquisition under consideration) was six and half years. It therefore calculated the increase for six and half years. This is obviously erroneous. The actual gap is five years and eight months and not six and half years. However, for the purpose of calculation, we have to exclude the year of the relied-upon transaction, which is the base year. If the year of relied-upon transaction in 1987, the increase is applied not from 1987 itself but only from the next year which is 1988. If the rate was Rs.10 per sq.m. in 1987, and the cumulative rate of increase is 7.5% per year, the price will be Rs.10.75 in 1988, Rs.11.56 in 1989, Rs.12.42 in 1990, Rs.13.35 in 1991 and Rs.14.35 in 1992. Thus the calculation of increase is only for five years and not for six and half years."

On the aforesaid analogy, the price escalation is to be taken only for one year and months short of a year is to be ignored. The price of land on 26.06.2006 as per the exemplar sale deed being Rs..25,00,000/- per kani, the price after one year would be Rs.32,50,000/-. Thus the market value of the bastu (nal) class of land on the date of notification comes to Rs..32,50,000/- per kani.

Acquirement of pukur (nal) and pukurpar (nal) class of land being to the extent of 0.12 acre and 0.055 acre respectively and in the exemplar sale deed no.1-6923 dated 20.06.2005, 0.04 acre of land being sold at the rate of Rs..10,00,000/- per kani, there shall be no deduction. On the contrary, on the basis of the averment made in para 4 of the claim statement that after purchasing the land which was pond, claimants developed the land making earth filling and constructing R.C.C. retaining wall spending more than Rs..5 lakhs, it needs consideration whether the exemplar price should be fixed higher than Rs..10,00,000/- per kani. On the averment, claimant has adduced evidence at para 5 of the affidavit-in-chief. Considering this, the base price is fixed at Rs..15,00,000/- per kani. As per the judgment of the Summit Court above referred, price escalation in this case is to be taken for two years cumulatively. 30% of Rs..15,00,000/- being Rs..4,50,000/-, the market value after one year i.e. on 20.06.2005 shall be taken as Rs..19,50.000/-. Accordingly, the market value at the end of second year shall be Rs..24,85,000/-.

What follows from the above is that the market value fixed by the L.A. Collector was not adequate and proper. The market value of pukur and pukurpar class of land is thus fixed at Rs..24,85,000/- per kani and that of bastu class at Rs..32,50,000/- per kani."

[Emphasis added]

Mr. A. K. Bhowmik, learned senior counsel appearing for the appellants has pointed out that the certain components of damage have been left out by the Land Acquisition Judge while determining the compensation for acquisition. To exemplify Mr. Bhowmik, learned senior counsel has stated that the loss suffered by the appellants for shifting their business from the place of acquisition to a new place as suffered was not included in terms of Section 23(1) of the Land Acquisition Act. That apart, Mr. Bhowmik, learned senior counsel has submitted that rate of yearly increase as determined by the Land Acquisition Judge at 30% is not reasonable comparing the yearly rate of escalation in those areas because of the proximity of the acquired land to the international land port and to the city of Agartala. However, Mr. Bhowmik, learned senior counsel did not make any substantive submission on the observation made in the para-11 of the impugned judgment where the Land Acquisition Judge has cited the apex court decision in respect of the rate of yearly increase at 10-15%. Despite that, the Land Acquisition Judge has considered the yearly increase at 30% per year and added the same with the compensation. Thereafter, on the basis of the rate in the highest sale-exemplar, the Land Acquisition Judge has determined the rate at Rs.24,85,000/-, giving 9,00,000/- per kani which is above the rate mentioned in the sale exemplar. Similarly, the Land Acquisition Judge has observed that the bastu class would be much more in terms of the market value.

Mr. A. K. Bhowmik, learned senior counsel appearing for the appellants has made reference to 3 (three) documents to establish that the appellants were running a business from the acquired land and the rate of rent is available in the lease deed, but that was not relied by the Land Acquisition Judge. From the lease deed executed between the Tripura Small Industries Corporation Limited and one of the appellants [Exbt.1], it appears that a monthly rent of the acquired land at the relevant time, immediately before the acquisition was Rs.12,660/- whereas from the Exbt.3 declaration made to the Superintendent of Customs, Agartala Land Customs Station it appears that the appellants were importing stone-chips, cement, bricks etc. and that area was being used as dumping areas for their materials. Apart that, one sale deed executed by one of the appellants namely Sri Nitai Chandra Saha in favour of one Sanjibur Rehman [PW-2] on 26.06.2006 [Exbt.2] has been relied to demonstrate the consideration for that piece of land measuring 1 ganda 2 karas 2 krantas 3½ dhurs.

From the other side, Mr. J. Majumder, learned counsel appearing for the respondents has submitted that from the assessment sheet it would be apparent that additional compensation at 12% has also been added to the compensation as per the provision under Section 23(1-A) of the Land Acquisition Act. Section 23(1-A) provides that in addition to the market value of the land, the Court shall in every case award an amount calculated at the rate of twelve per centum per annum on such market value for the period commencing on the date of publication of the notification under Section 4, sub-section(1) of the said Act. This is seperate from the solatium. According to Mr. J. Majumder, learned counsel appearing for the respondents, this has been given for the miscellaneous damages.

Having regard to the evidentiary materials and records and the submission made by the learned counsel for the parties two pertinent points would emerge for decision of this court viz.,

(i) Whether the damage for shifting the business can form an independent component within Section 23(1-A) of the Land Acquisition Act?

(ii) Whether the rate as determined for the acquired land by the Land Acquisition Judge requires interference or not?

Section 23(1) of the Land Acquisition Act has specified 6(six) different components to be taken into consideration in addition to the special determination as provided under Section 23(1-A) and 23(2) of the Land Acquisition Act. The 6(six) determinative components are:

(i) the market value of the land on the date of the publication of the notification under Section 4, sub- section (1);

(ii) the damage sustained by the person interested, by reason of damage of standing crops or trees which may be on the land at the time of the Collector's taking possession of the land,

(iii) the damage (if any), sustained by the person interested, at the time of the Collector's taking possession of the land, by reason of severing such land from his other land;

(iv) the damage (if any), sustained by the person interested, at the time of the Collector's taking possession of the land, by reason of the acquisition injuriously affecting his other property, movable or immovable, in any other manner, or his earnings;

(v) if, in consequence of the acquisition of the land by the Collector, the person interested is compelled to change his residence or place of business, the reasonable expenses (if any) incidental to such change; and

(vi) the damage (if any) bona fide resulting from diminution of the profits of the land between the time of the publication of the declaration under section 6 and the time of the Collector's taking possession of the land.

Mr. A. K. Bhowmik, learned senior counsel appearing for the appellants has even though not referred specifically the 5th component but from his submission it is gathered that he had referred to the damage that the land-losers suffered for shifting of his business. But from the statement of claim filed by the appellants before the Land Acquisition Judge, there is no specific claim what the appellants had suffered for shifting of their business. What is gathered from the claim-statement is that the claimant namely Nitai Chandra Saha had filled up the pond and converted the said land to bastu class by constructing a retaining wall around the pond incurring the expenditure more than 5,00,000/-. In the deposition in the trial, the claimants-appellants have stated that for the shifting of their business they had suffered a loss of income to the extent of Rs.2,00,000/- per month.

In the examination-in-chief one of the appellants namely Nitai Chandra Saha has stated in support of the conversion of the land as under:

"That I had purchased the adjacent land from vendor Md. Sanjibur Rahaman on 26.06.2006 @ Rs.25 lakhs per kani. The acquired land was also a pond, but subsequently I filled up the pond and it was converted to a bhitti/bastu class of land by constructing retaining wall around the then pond spending more than Rs.5 lakhs for the RCC retaining wall."

Even PW-2 has corroborated the said statement in terms of Section 156 of the Evidence Act. But what has been noticed is that the khatian recorded the classification as pukur par (nal), not as the viti class of land. Hence it has to be assumed that such conversion was illegal and in contravention of the provision of Section 20 of the Tripura Land Revenue & Land Reforms Act, 1960. Even in the sale-deed dated 26.06.2006 [Exbt.2] the said land has been as the pond. However, the appellants have asserted for enhancement of the rate. In the cross-examination, PW-2 did not deviate from his examination-in-chief.

Having regard to the evidentiary materials and submission as made, this court is of the considered opinion that in consequence of the acquisition of the land, the appellants were compelled to change their place of business and they are entitled to reasonable expenses incidental to such change, but not the loss of business. Thus, this court is of the opinion that a lump sum of Rs.1,00,000/- in addition to the land value shall be paid to the appellants in terms of the 5th component under Section 23(1) of the Land Acquisition Act. So far the land rate is concerned this court is of the further view that the Land Acquisition Judge has adopted a very liberal method for determining the land rate and as such no further enhancement in the market rate is warranted. Accordingly, that claim stands dismissed. Since no documentary evidence has been placed to show that the land was lawfully converted to a viti class and as such, the appellants cannot get the rate for the 'converted' class of Land. The cumulative effect of such discussion is there would be no change in the land rate that beyond what has been awarded by the Land Acquisition Judge.

Having observed thus, the appeal is allowed to the extent as indicated above. The appellants shall only be entitled to an additional lump sum payment of Rs.1,00,000/- as the expenses of change of the place of business.

Prepare the award/decree accordingly. Send down the LCRs thereafter.