Subhash Chand vs State of Punjab

N.K. Kapoor, J.—(sic) of 15 letters patent appeals preferred against the common judgment of learned Single Judge dated 12.9.1988.

Brief facts leading to these appeals are that State of Punjab vide notification issued under Section 4 of the Land Acquisition Act dated 28.2.1983 sought to acquire land measuring 158.70 acres situated within the revenue limits of village Chalheri for the purpose of construction of Sutlej Yamuna Link Canal. This notification was followed by a publication of a declaration under Section 6 of the Act on 9.3.1984. Collector issued notices under Section 9 of the Act inviting claims and objections and gave hearing to the interested persons who appeared before him.

For ascertaining the value of the acquired land the Collector requested the District Collector, Patiala to supply him the market rates of the land. District Collector (D.C.) intimated the market value of the land as the following rates :

1) Chahi

Rs. 20,000/ per acre;

2) Barani

Rs. 15,000/ per acre; and

3) Banjar

Rs. 12,000/ per acre.

The Collector did not consider the rates supplied by the District Collector as truely representing the prevalent market value and so did not adopt these rates. Collector awarded the following rates :

1) Chahi (I)

Rs. 19,500/ per bigha

2) Chahi (II)

Rs. 10,000/ per bigha

3) Nehri

Rs. 10,000/ per bigha

4) Rausli

Rs. 15,000/ per acre

5) Gair Mumkin

Rs. 12,000/ per acre

Dissatisfied with the quantum of compensation awarded by the Collector, land owners the claimants sought reference to the Court for determination of fair market price of the acquired land.

State contested the claim of the landowners for enhancement of compensation.

On the pleadings of the parties a number of issued were framed, namely, what was the market value of the acquired land on the day of notification under Section 4 of the Act ? Other issues pertained to the effect of spliting of land in two separate blocks, part of land left on account of acquisition being now deprived of irrigation facilities and the damages on account of severance of holdings. The last noted plea was, however, held as redundant by the Court in view of the statement made by the claimants that the Collector in his award has incorporated that a supplementary award will be made by him to pay compensation of the landowners on account of loss occasioned to them due to fragmentation of their holdings.

Parties were permitted to adduce evidence documentary as well as oral. Claimants with a view to prove the high potential value of the acquired land which adjoins G.T. Road examined Randhir Singh AW1 a qualified Draftsman, Harjinder Singh AW2, a property dealer of Rajpura, Amrit Singh AW3, Revenue Patwari circle Chalheri and Raja Ram AW4, a businessman of Ludhiana who had planned to purchase a chunk of land from the acquired land for setting up a foundary plant and lastly Bant Singh, General Attorney of Manjit Kaur. Draftsman in his deposition stated that site plan exhibit A1 was prepared showing the location of land visavis habitation. As per the site plan the acquired land is shown touching the points at CD and EF. This place is 4.28 kilometres from Rajpura town and 3.10 kilometres from Shambu Barrier, the boundary of Punjab State. Harjinder Singh and Raja Ram proved the execution of agreement dated 19.1.1983 a photo copy of which is exhibit A3 whereby claimants Nand Lal and Krishan Kumar had agreed to sell 5 bighas and 4 biswas of their land to AW Raja Ram for a consideration of Rs. 1,65,000/. Out of the agreed sale price Rs. 20,000/ was paid as earnest money. Time for execution of sale deed was fixed as 15.6.1981. This transaction, however, could not be materialised in view of the intervention of acquisition proceedings. Land Acquisition Court placed reliance upon this document and so assessed the compensation payable to the claimants whose land fell close to G.R. Road and so awarded the compensation at the rate of Rs. 1,65,000/ per acre for the land acquired upto a depth of 100 karams irrespective of its revnue classification from the G.T. Road. As regards the quantum of compensation awarded i.e. land adjoining the urban estate upto a depth of 50 karams irrespective of its revenue classification evaluated at the flat rate of Rs.1,80,000/ per acre. Other irrigated lands (which did not fall within the above two belts) were evaluated at the rate of Rs. 15,000/ per bigha. Rasuli kind of land was evaluated at the rate of Rs. 7,500/ per bigha whereas Gair Mumkin at Rs. 6,000/ per bigha.

Dissatisfied with the judgment of the District Judge claimants as well as the State of Punjab preferred appeals which were disposed of by the imgpuned judgment of the learned Single Judge. Before the learned Single Judge State of Punjabappellant primarily contested the quantum of compensation assessed by the Court regarding the land abutting either side of the G.T. Road upto a depth of 100 karams i.e. at the flat rate of Rs. 1,65,000/ per acre. Advocate General, Punjab challenged the finding of the Court regarding evaluation of land lying within a depth of 100 karams on either side of the G.T. Road, as the Court primarily depended upon the agreement exhibit A3. It was argued that exhibit A3 could not be made basis to award compensation, firstly, that the same could not be construed as a sale and, secondly, same has not even been proved beyond an element of doubt. It was argued that out of an alleged consideration of Rs. 1,65,000/ only a sum of Rs. 20,000/ was paid as an advance to the vendors. Except for this solitary instance there was no supportive evidence on record and so the Court erred in law in relying upon the same to evaluate the market value of the land acquired. Besides it, the very fact that this agreement came into existence just a month and a half before the notification issued under Section 4 is by itself a sufficient indication that the same was not a bona fide transaction. Rather, this came into existence solely with a view to inflate artifically the price of the land.

Learned Single Judge on considering the matter in the light of oral and documentary evidence came to the conclusion that there was no justifiable reason for the Court to award compensation at a flat rate of Rs. 1,65,000/ per acre for the land falling within a depth of 100 karams on either side of the G.T. Road. All the same the Court observed that the lands falling within this distance i.e. upto 100 karams or either side of the G.T. Road have to be treated as better located agricultural lands. Resultantly, the learned Single Judge modified the judgment of the District Judge with regard to the land falling within a depth of 100 karams on either side of the G.T. Road and so awarded compensation at the rate of Rs. 19,500/ per bigha instead of Rs. 1,65,000/ per acre. Assessment with regard to the quantum of compensation regarding other lands visavis their location as well as the nature of land and the compensation payable was affirmed.

Thus, the sole point which has now been pressed by the learned counsel representing the appellants is with regard to the finding of the learned Single Judge regarding compensation payable in respect of the area falling within a depth of 100 karams on either side of the G.T. Road. According to the counsel representing the claimantsthe appellants, the learned Single Judge has erred in law in dismissing the appeals of the appellants of enhancing of the compensation. Not only this, the learned Single Judge has further erred in reducing the compensation from the one awarded by the Court. According to the counsel, agreement exhibit A3 has been duly proved on record. It was a bona fide transaction which solely fell through on account of acquisition proceedings. Evidence led to prove this agreement is cogent and trustworthy. There is not an iota of evidence on record to suggest that the agreement was a fake transaction. The fact that area abutting the G.T. Road has a great potential for utilisation of such land for commercial and industrial purposes stands eloquently demonstrated (sic) site plan which depicts the various industrial units near about the land acquired. Otherwise too, judicial notice can be taken of the fact that this area is within 3 to 4 kilemeters from the Municipal limits of Rajpura town a town busting with industrial activities. Precisely for these reasons District Judge chose to award compensation to the claimants of the rate of Rs. 1,65,000/ per acre. The assessment made by the District Judge is rather conservative. In any case, there was no legitimate reason for the learned Single Judge to have reduced the compensation.

Learned State counsel almost reiterated the arguments which found favour with the learned Single Judge.

Agreement dated 19.1.1983, its bona fide and value in determining the market value of the acquired land is subject matter of scrutiny. Nand Lal and Krishan Kumar claimants agreed to sell 5 bighas and 4 biswas of land to Raja Ram AW4 for a consideration of Rs. 1,65,000/. Out of the sale consideration a sum of Rs. 20,000/ was paid by the vendees to the vendors. Last date for carrying out this agreement was 15.6.1984. Since notification was issued by the government on 28.2.1983, obviously the sale was not executed. This agreement came into existence barely one and a half month prior to the date of acquisition of land. It is common knowledge that before land is sought to be acquired, it is surveyed by the authorities more than once before its actual notification under Section 4 of the Act. In the instant case the land was being acquired for SYL canal which runs through the length and breadth of Punjab. The likely alignment of the SYL Canal was not a secret. It has been a matter of heated discussions in the newspapers as well. Thus, it would be safe to infer that the claimants knew well in advance that a part of their holding situated within the revenue limits of village Chalheri would also be acquired by the Government with a view to construct SYL Canal and viewed so it can be stated that this agreement came into existence solely with a view to prop up the price of the land to be acquired. The division Bench in Reddiar and another v. Secretary of State and another, AIR 1928 Rangoon 65 while dealing with this aspect observed as under :

"No doubt, proof of bona fide offers have to be considered by a Court, but the probative value of offers has, for good reasons in this country, been held to by very low indeed, for the offers alleged in land acquisition proceedings are scarely ever bona fide. They can be easily arranged without any loss or inconvenience to either party, and individuals, respectable in their various relations of life, have no computation in leading themselves to a fictitious transaction which may assist a friend in extracting more than his due from Government or a public body at no cost to themselves."

Precisely for this reason the learned Single Judge held that agreement was not intended to be acted upon. We find no infirmity in this finding of the learned Single Judge.

The matter can be examined from another angle i.e. but for this agreement there is no other sale transaction or even any other agreement which could possibly show the potential of the price as refelcted in this agreement. No doubt as depicted in the site plan area comes close in proximity to the G.T. Road. How far its nearness to G.T. Road can be stated to confer a greater potential to the land can be a matter of mere assessment. All the same, one can without any hesitation state that the area on either side of the G.T. Road upto say 100 karams can be termed to be better located agricultural lands. The learned Single Judge despite having come to this conclusion that lands upto 100 karams on either side of the G.T. Road are to be treated as better located agricultural lands yet did not award a higher compensation on account of its location. To that extent the jjdgment of the learned Single Judge indeed needs to be modified. How much compensation should be awarded on account of its better location is again a matter of guess. According to the learned counsel for the appellantsthe claimants the value of such land should be assessed keeping in view the value of land adjoining the urban estate of Rajpura whereas according to the State counsel there was no legitimate reason to award enhanced compensation as the Court while evaluating this land has already awarded a higher compensation visavis other such nature of land as per its classification given in the impugned judgment. Collector assessed the market value of agricultural land : Chahi (I) at Rs. 19,500/ per bigha, Chahi (II) at Rs. 10,000/ per bigha. The learned Single Judge has chosen to award all types of irrigated land falling within a depth of 100 karams on either side of the G.T. Road at Rs. 19,500/ per bigha. Thus, whereas enhancement has been awarded to the claimants of lands of Chahi (II) from Rs. 10,000/ per bigha to Rs. 19,500/ per bigha in view of their lands falling within a depth of 100 karams on either side of the G.T. Road no enhancement indeed has been given to claimants of Chahi (I), category. To this extent the grievance is legitimate.

On considering the matter from all conceivable angles whereas we find no ground to equate this category land falling within the 100 karams on either side of the G.T. Road with the land within 50 karams from the urban estate of Rajpura, all the same, are of the view that it is a category by itself and so deserves to be awarded a bit higher compensation than the compensation awarded on account of its quality i.e. irrigated/barani. Compensation assessed by the learned Single Judge i.e. Rs. 19,500/ per bigha comes to Rs. 95,000/ (approximately) per acre. Rise of Rs. 10,000/ per acre on account of its better location would be just. So, we assess the compensation payable to the claimants whose land fall within 100 karams on either side of the G.T. Road at the rate of Rs. 1,05,000/ per acre. Other conclusions of the learned Single Judge are being affirmed. The appellants, of course, would be entitled to statutory benefits like solatium and interest as permissible.

Appeals are allowed to the extent indicate above with proportionate costs.

Appeals partly allowed.