Raj Kumar vs The State of Punjab etc.

Jai Singh Sekhon, J.—This judgment will dispose of R. F. A. Nos. 710, 755, 756, 757, 607 and 779 of 1981, as these arise out of the same award of the learned Additional District Judge, Jullundur and rest upon the same evidence.

In brief, the relevant facts are that in pursuance of the notification published on 20th February, 1976, u/s 4 of the Land Acquisition Act, 1894 (hereinafter referred to as the Act), the Punjab Government (Industries Department) sought to acquire 114.33 Acres of land in the revenue estate of the Jullundur for setting up an Industrial Focal Point at Jullundur. The Land Acquisition Collector vice his award dated 19th November, 1970, awarded compensation of the acquired land by taking into consideration its location vis-a-vis the metalled road as under :-

First belt (land abutting on G. T. Road Bye-pass upto the depth of 21 Karams) ...Rs. 120/- per marla. 2. Und belt (land abutting on both sides of Randhawa Masanda Link Road upto the depth of 21 Karams) ...Rs. 165/- -do- 3. Chahi, Nehri, G. M Chah, Tube-well and G. M. Abadi ...Rs. 150/- -do- 4. Bar. ni ...Rs. 105/- -do- 5. Gair Mumkin Rasta ...Rs. 90/- - do -

The compensation of the super-structure in existence or of the trees etc. growing on this land was not assessed as by then the evaluation reports of different Authorities in this regard were not received. Being dissatisfied with the adequacy of the compensation awarded by the learned Collector, the landowners claimants successfully sought reference u/s 18 of the Act to the Court of the District Judge, Jullundur. Shri M S. Luni, the then Additional District Judge Juliundur vide his impugned award dated 27th January, 198.1, maintained the compensation of the acquired land as awarded by the Land Acquisition Collector on the ground that after the coming into force the Urban Land (Ceiling & Regulation) Act, 1976, with effect from 17th February. 1970, the acquired land cannot be used for purposes other than agriculture. He, however, awarded compensation to the tune of Rs. 2000/-each on account of jseverence of their land holdings to Balbir Raj, Amar Singh, Ajit Singh and Kalyan Dass Claimants. Still dissatisfied with the adequacy of the compensation, the claimants have come up in these appeals

The appellants were allowed to produce certified copy (Exhibit AAI) of the award of Shri B S Teji, learned Additional District Judge, Julludur, in M/s Steel Products (India) v. State of Punjab and Anr., dated 16th February, I9 82, by Way of Additional evidence, as according to both the parties it had attained finality being cot challenged by any party and related to a portion of the same land acquired vide same notification and for the same purpose as the land of the present appellants.

The main stress of the learned counsel for the appellants in all the appeals is that the award given by the learned Additional District Judge, Jullundur, copy Exhibit AAI having become final, the appellants are entitled to get the same rate of compensation. It was also maintained that there is enough evidence on the file to establish the residential and commercial future potential of the acquired land. They also maintained that the decision of the Single Bench in R. F. A. No. 1223 of 1979 (Punjab State and Anr. v. Hans Raj, R. F. A. 1223 of 1979.), decided on 10th March, 1980, by I. S. Tiwana, J. being on facts regarding the future potential of the land in that case is not binding on this Court, especially when the same has not become final as it is still under assail before the Supreme Court. They also maintained that coming into force of the Urban Land Ceiling Act with effect from 17th February, 1976, i.e. only three days prior to the publication of the notice u/s 4 of the Act in the case in hand would not dwindle the situation potential of the acquired land for commercial and residential purpose Mr H. S. Bedi, learned Additional Advocate General, Punjab, appearing for the respondents, on the other hand, controverted the above referred contentions of the learned counsel for the appellants, contending that the provisions of the Urban Land Ceiling Act would act as damper on the price of the acquired land in the open market, especially when the user of the land cannot be changed without prior permission of the concerned Authority.

There is m dispute between the parties that the entire acquired tend for setting up an Industrial Focal Point at Jullundur is located within the Municipal limits of Jullundur town. The acquired land ahuis the bye pass along the Grand Trunk Road on one side and falls along both the sides of the Randhawa Masanda metalled link road. The scale-plan. Exhibit P-l prepared Shri Ram Ditia Mai, Draftsman, (P. W. 1) and his evidence also reveals that the acquired land of Kalyan Dass, Biilbir Raj Sondhi, Karam Singh and Tarn Singh, claimants abuts the bye-pass road upto the width of 200 feet, and that the acquired land for setting up Focal Point is surrounded by the land of villages Reru, Saipur, Dada Colony Industrial Area, Jenta Colony, Cold Storage, Godowns of Food Corporation. Milk Plant, Improvement Trust Scheme of 51.5 acres and another Scheme of 45 acres and 29 acres. He has also depicted factory of Amln Chand Piare lal and the location of the land sold by Jowand Singh and Tara Singh appellants. During cross examination, it was elicited from this Drafts it an that he has prepared the site-plan at the instance of Balbir Raj Sondhi one of the appellants and that village Reru falls at a distance of about half a furlong from the northern boundary of industrial Focal Point. The habitation of village Saipur is at distance of l/2 furlongs from the industrial area Janta Colony is at a distance of 2 furlongs, Cold Storage is at a distance of about half a furlong, Seed Corporation godown is at a distance of 30 feet, Milk Plant is at a distance of 2 miles from the focal point area. The Improvement Trust Scheme of 29 acres and 45 acres are adjacent are adjacent to the focal point area and the schema of 51.5 acre is at a distance of 3 furlongs The factory of Amin Chand Piare Lal is at a distance of 2 miles. The authenticity of the different situations depicted in the plan Ex. P. 1 was admitted by Mohan Singh, Patwari (R.W. 1) attached with the Industries Department, during cross-examination He also admitted the existence of Cold Storage and some Godowns near the acquired land but failed to contradict if the factory of Amin Chand Pyare Lal also falls near it. Thus, the evidence of Balbir Raj Sondhi (PW. 3), Raj Kumar Sehgal (P W. 4), Tarsem Lal (P.W. 5) and Amar Sinah (P W 6) that the acquired land was surrounded by the above referred factories and residential colonies, finds due assurance from the evidence of Ram Ditta Mal Draftsman and the plan, Exhibit P. 1 prepared by him. it is noteworthy that in part ''B'' of this plan, the Draftsman had depicted the location of'' Milk Plant, 51 5 Acres of Improvement Trust Scheme, Janta Colony, Dada Colony, Old Industrial area, habitation of village Reru, factory of Amin Chand Piara Lal, Kanya Maha Vidyala, as well as the location of the above referred main roads; whereas the plan Ex. R.''l prepared by Shri Mohan Singh Patwari depicts only the acquired land and not the location of any of the factories or residential colonies, referred to above Under these circumstances, there is no option but to conclude that the acquired land had unique situation potential for use as residential and commercial purposes.

The decision of I. S. Tiwana, J. in Hans Raj''s case (supra) to the effect that the claimants in that case had failed to prove the situation potential of the acquired land of being used for commercial and residential purposes being based on the evidence in that case is of the relevance in coming to the conclusion that the acquired land of the present appellants has no situation potential for the above referred purposes or coming to the conclusion that it should be treated as an agricultural land only. In that case there was only a bald statement of Hans Raj claimant regarding the existence of Industrial concerns and cold storages near about the acquired land The location of the industrial concerns and the cold storages was also not depicted in any of the plans. Under these circumstances, the appeal filed by the State of Punjab was partly accepted. Moreover, the decision in Ham Raj''s case (supra) has not attained finality so far as it is admitted case of the parties that it is still under assail before Hon''ble the Supreme Court.

The question then arises whether the findings of the Additional District Judge in the impugned award to the effect that after coming into force of the Urban Land Ceiling Act with effect from 17th February, 19 "6, the land in question cannot be sold by their owners for commercial purposes and thus its market value on 20th February, 1976 could be assessed only as an agricultural land and not on the basis of its situation potential for commercial and, residential purposes, are well founded or not. In this regard, it is noteworthy that agricultural land has been excluded from the definition of ''urban land'' figuring in clause ''O'' of Section 2 of the Urban Land Ceiling Act, which reads as under:--

" ''urban land means'' " (i) any land situated within the limits of an urban agglomeration and referred to as such in the master plan; or

(ii) in a case where there is no master plan, or where the master plan does not refer to any land as urban land, any land within the limits of an urban agglomeration and situated in any area included within the local limits of a municipality (by whatever name called), a notified area committee, a town area committee a city and town committee, a small town committee, a cantonment board or a panchayat, but does not include any such land which is mainly used for the purpose of agriculture.

Explanation -For the purpose of this clause and clause (g)-

(A) ''agriculture'' includes horticulture, but does not include-

(i) raising of grass,

(ii) dairy farming,

(iii) poultry farming,

(iv) breeding of livestock, and

(v) such cultivation, or the growing of such plant, as may be prescribed;

(B) land shall not be deemed to be used mainly for the purpose of agriculture, if such land is not entered in the revenue of land records before the appointed day as for the purpose of agriculture: Provided that where on any land which is entered in the revenue or land records before the appointed day as for the purpose of agriculture, there is a building which is not in the nature of a farm house, then, so much of the extent of such land as is occupied by the building shall not be deemed to be used mainly for the purpose of agriculture:

Provided further that if any question arises whether any building is in the nature of a farm-house, such question shall be referred to the State Government and the decision of the State Government thereon shall be final; (C) Notwithstanding anything contained in clause (B) of this Explanation, land shall not be deemed to be mainly used for the purpose of agriculture if the land has been specified in the master plan for a purpose other than agriculture."

A reading of the above referred statutory definition of ''urban land'' leaves no doubt that it excludes the agricultural land from the mischief of this Act, unless such land has been specified in the master plan for a purpose other than agriculture. In the case in hand the respondents had not produced any master plan on the file or led any other evidence in order to prove that in the master plan the acquired land has been specified for any other purpose.

The definition of ''vacant land'' figuring in clause (a) of Section 2 of the Urban Land Ceiling Act excludes agricultural land mainly used for agriculture purposes. Clause (a) runs as under:-

"Vacant Land'' means land not being land mainly used for the purpose of agriculture an urban agglomeration, but does net include -

(i) land on which construction of a building not premissible under the building regulations in force in the area in which such land is situated;

(ii) in an area where there are building regulations, the land occupied by any building which has been constructed before or is being constructed on, the appointed day with the approval of the appropriate authority and the land appurtenant to such building ; and

(iii) in an area where there are no building regulations, the lend occupied by any building which has been constructed before or is being constructed on, the appointed day and the land appurtenant to such building:

Provided that where any person ordinarily keeps his cattle other than for the purpose of dairy farming or for the purpose of breeding of live- stock on any land situated in a village within an urban agglomeration (described as a village in revenue records), then, so much extent of the land as has been ordinarily used for the keeping of such cattle immediately before the appointed day shall not be deemed to be vacant land for the purposes of this clause."

A combined reading of the definitions of ''urban land and ''vacant land'' absolutely leaves no doubt that the Legislature had deliberately excluded the land mainly used for agricultural purposes from the rigorous of the Urban Land Ceiling Act. If that is so, then the provisions of Section 6 requiring a person holding vacant land in excess of the ceiling limits to file a statement or the acquisition of such land by the concerned authority on payment of nominal sale value as provided u/s 19 would not be attracted to the land mainly used for agricultural purposes. The factum that the State Government had not resorted to the pro- visions of Section 11 of the Urban Land Ceiling Act for the acquisition and in determining the compensation of the land also shows that in practice also the agricultural land is sot being treated as urban land or vacant land as defined in the Act, Under these circumstances, it cannot be said that the future potential of the acquired land has been frozen for agricultural purposes only and that it cannot be sold to other persons far residential or commercial purposes. The only restriction imposed toy this Act is that the land would be sold in the shape of plots tailing within the permissible ceiling of the Act in case the purchaser or vendee went to convert its use for residential and commercial purposes. Thus, the promulgation of this Act on 17th February, 1976, i e. hardly three days prior to the acquisition of this land on 20th February, 1976, would not amount to fall in the price of the acquired land, what to say of placing any clog on the conversion of the use of this land for commercial and residential purposes from agricultural one, especially when there is no evidence on the file whether this land was reserved for any particular purpose in the roaster plan Anyhow since the land has been acquired by the State Government in the Industries Department for setting up an industrial focal point at Julluodur, it can be well inferred that in the master plan, if any, the concerned Authority has specified the use of this land for setting up industries only In that case also, the land will still have its industrial situation potential for assessing the market value on the relevant date, i.e. on 20th February, 1976.

A similar controversy came under the scrutiny of a Division Bench of this Court in R.F. A No. 1550 of 1977 (Shri Ramu alias Ram Singh and Anr. v. The Union Territory of Chandigarh, R. F. A. No. 1550 of 1977.), decided on 19th September, 1979 In that case while discussing the effect of the provisions of the Punjab New Capital (Peripheri) Control Act, 1952, prohibiting the landowners not to raise any construction on the area in question and its effect on the potentiality of the acquired land for being developed into a residential colony or an urban estate, the observations of the Division Bench of this Court in L. P. A. No". 113 of 1978 (Union of India v. Pritam Singh and Ors. 1978 L. P. A. 113 .), decided on 15th February, 1979 to the following effect were relied upon :-

"It was also contended by the learned counsel for the appellant that according to the New Capital Periphery Control Act, no piece of land could be utilised for purpose other than the one to which it was already in use on the date of commencement of the Act In view of the same it was stressed that the owners of land in dispute could not convert the agricultural land into building sites. There- fore, these lands cannot be evaluated as potential building sites. The perusal of this Act shows that the only limitation placed en the lands within the periphery of Chandigarh, as laid down therein, was that the permission of the Capital Project authorities had to be obtained for making any construction. Besides, though there may be a restriction on making actual construction under the rigorous of the Act, but the development of the city of Chandigarh could not in any way prevent the adjoining lands from being converted into potential buildings sites."

Under these circumstances, the Division Bench of this Court following the ratio in Pritam Singh''s case (supra) enhanced the compensation of the acquired land while upsetting the findings of the learned Additional District Judge, Chandigarh, to the effect that the land has no situation potential for its use for residential and commercial purposes in view of the provisions of the New Capital Periphery Control Act In the case in hand also the provisions of the Urban Land Ceiling Act would be of no consequence in prohibiting the owners of agricultural lands for selling it for residential or commercial purposes provided the area sold by them does not exceed the permissible limit under the relevant provisions of the above referred Act. Thus, the findings of the learned Additional District Judge in this regard being not sustainable are hereby set aside.

Regarding the quantum of compensation of the acquired land it transpires that the decision of Mr. B. S. Teji,. the then Additional District Judge, Jullundur, dated 16th February, 1982, Exhibit AAI had admittedly attained finality. In that case, for the land falling in IInd Belt, the compensation was awarded at the rate of Rs. 400/- per marla. No different yard stick can be adopted in the present appeals in determining the market value of the acquired land on 20th February, 1976, although some of the land of the present appellants falls in Belt I also. However, the belting system adopted by the Land Acquisition Collector was rightly set aside by the learned Additional District Judge, under the impugned award, as it was a compact piece of land and had the same situation potential. The evidence of Sadhu, (P W. 2) that he and Gulwant Singh had purchased two plots of land measuring 10 Marias each from Tara Singh, located near the bye-pass vide sale-deeds, Exhibits P. 2 and P. 3 in the year 1974-75 for Rs. 8,000/- each, i.e. at the rate of Rs. 800/- per Maria sounds truthful as the perusal of these two deeds reveals that the entire sale consideration was paid before the Sub-Registrar. These plots of land also form part of the acquired land. However, keeping in view that small pieces of land attract more buyers and fetch more prices than the large chunk of land it can be well said that the market price of the acquired land would not be less than Rs. 400/- per Maria

For the foregoing reasons, the compensation of all types of land is enhanced to Rs. 400/-per Maria The appellants shall also be entitled to 30% solatium over and above the said compensation, besides allowing an amount equal to 12% per annum over and above the compensation from the date of notification u/s 4 of the Act till the date of the pronouncement of the award by the Land Acquisition Collector or taking of the possession of the land, whichever is earlier The claimants shall also be entitled to 9% per annum interest on the said compensation for the first year from the date of delivery of possession of the laud and 15% per annum for the subsequent years There is, however, no order as to costs in view of the peculiar circumstances of the case.