Karnataka High Court
Smt. Lalithamma vs Land Acquisition Officer on 16 October, 2025
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NC: 2025:KHC:41247-DB
M.F.A. No.1754/2017
C/W M.F.A. No.1311/2016
HC-KAR
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 16TH DAY OF OCTOBER, 2025
PRESENT
THE HON'BLE MRS. JUSTICE ANU SIVARAMAN
AND
THE HON'BLE MR. JUSTICE VIJAYKUMAR A. PATIL
MISCELLANEOUS FIRST APPEAL NO.1754/2017 (LAC)
C/W
MISCELLANEOUS FIRST APPEAL NO.1311/2016 (LAC)
IN M.F.A. No.1754/2017:
BETWEEN:
1. THE LAND ACQUISITION OFFICER
KOLAR SUB DIVISION
Digitally signed KOLAR.
by RUPA V
2. THE STATE OF KARNATAKA
Location: High
BY ITS PRINCIPAL SECRETARY
Court of
EDUCATION DEPARTMENT
karnataka
M.S.BUILDING, BENGALURU-560001.
[AMENDED ON 27.10.2017 AS PER
ORDER DATED 27.10.2017].
...APPELLANTS
(BY SMT. PRATHIBHA R.K. AGA)
AND:
SMT. LALITHAMMA
W/O LATE GOPAL RAO
SINCE DIED AND
RESPONDENTS 2 TO 6 ARE THE LRS.
1. SRI. N.G. SAMPATH
AGED ABOUT MAJOR.
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M.F.A. No.1754/2017
C/W M.F.A. No.1311/2016
HC-KAR
[DIED DURING TRIAL
DELETED AS PER C.O.DTD:02.03.2017]
2. SRI. N.G. VASUDEVA
AGED ABOUT MAJOR.
3. SRI. SRINIVASAN
AGED ABOUT MAJOR.
4. SRI. N.G. RAVIKUMAR
AGED ABOUT MAJOR.
5. SRI. N.G. SHESHAGIRI RAO
AGED ABOUT MAJOR.
6. SRI. N.G. AMARANATH
AGED ABOUT MAJOR.
ALL ARE SONS OF LATE GOPAL RAO
AND TRUSTEES OF GOPAL RAO
MEMORIAL TRUST
RESIDENTS OF D.C. EXTENSION
TEKAL ROAD, KOLAR TOWN-563101.
...RESPONDENTS
(BY SRI. A. MADHUSUDHAN RAO, ADV., FOR R2 TO R6
(R1 DEAD BY LRS R2 TO R6)
---
THIS MFA IS FILED U/S 54(1) OF LAND ACQUISITION ACT,
PRAYING TO ALLOW THIS APPEAL AND SET ASIDE THE JUDGMENT
AND AWARD DATED 09.10.2015 MADE BY THE LEARNED I ADDL.
SENIOR CIVIL JUDGE, AT KOLAR IN LAC NO.01/2009 IN THE
INTEREST OF JUSTICE AND EQUITY.
IN M.F.A. NO.1311/2016:
BETWEEN:
SMT. LALITHAMMA
W/O LATE GOPAL RAO
SINCE DEAD BY LRS 1 TO 5.
1. SRI. N.G. VASUDEV
S/O LATE GOPAL RAO
AGED ABOUT 65 YEARS.
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M.F.A. No.1754/2017
C/W M.F.A. No.1311/2016
HC-KAR
2. SRI. N.G. SRINIVASAN
S/O LATE GOPAL RAO
AGED ABOUT 63 YEARS.
3. SRI. N.G. RAVIKUMAR
S/O LATE GOPAL RAO
AGED ABOUT 61 YEARS
4. SRI. N.G. SHESHAGIRI RAO
S/O LATE GOPAL RAO
AGED ABOUT 59 YEARS.
5. SRI. N.G. AMARANATH
S/O LATE GOPAL RAO
AGED ABOUT 57 YEARS.
ALL R/AT P G EXTENSION
KOLAR TOWN, KOLAR-563101.
...APPELLANTS
(BY SRI. A. MADHUSUDHAN RAO, ADV.,)
AND:
LAND ACQUISITION OFFICER
KOLAR SUB DIVISION
KOLAR-563101.
...RESPONDENT
(BY SMT. PRATHIBHA R.K. AGA)
THIS MFA IS FILED U/S 54(1) OF LAND ACQUISITION ACT,
PRAYING TO SET ASIDE THE JUDGMENT AND AWARD PASSED IN
LAC NO.1/09 DATED 09.10.2015 IN SO FAR AS IT RELATES TO
FIXING THE MARKET VALUE OF THE LAND OF THE APPELLANTS
ONLY AT RS.10,00,000/- PER ACRE INSTEAD OF RS.25,00,000/-
PER ACRE AND AWARD THE ENHANCED COMPENSATION BY
CALCULATING THE MARKET VALUE ON THE DIFFERENCE
AMOUNT OF RS.15,00,000/- PER ACRE CLAIMED AND ALLOW
THIS APPEAL WITH COSTS AND GRANT SUCH OTHER RELIEFS
AS THIS HON'BLE COURT MAY DEEM FIT TO GRANT IN THE
CIRCUMSTANCES OF THE CASE.
THESE MFA's HAVING BEEN HEARD AND RESERVED ON
10.10.2025, COMING ON FOR PRONOUNCEMENT OF JUDGMENT,
THIS DAY VIJAYKUMAR A. PATIL J., DELIVERED THE FOLLOWING:
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M.F.A. No.1754/2017
C/W M.F.A. No.1311/2016
HC-KAR
CORAM: HON'BLE MRS. JUSTICE ANU SIVARAMAN
and
HON'BLE MR. JUSTICE VIJAYKUMAR A. PATIL
CAV JUDGMENT
(PER: HON'BLE MR. JUSTICE VIJAYKUMAR A. PATIL) MFA No.1311/2016 is filed by the claimants seeking for higher compensation and MFA No.1754/2017 is filed by the Land Acquisition Officer (LAO), Kolar and another. Both the appeals arise out of judgment and award dated 09.10.2015 passed in LAC No.1/2009 by the I Additional Senior Civil Judge, Kolar.
2. The parties are referred to as per their ranking before the Reference Court.
3. The brief facts leading to the filing of these appeals are that the claimants are the owners of land measuring 3 acres 5 guntas in Sy.No.222 of Narasapura Village, Narasapura Hobli, Kolar Taluk. The State Government issued preliminary notification under Section 4(1) of the Land Acquisition Act, 1894 (hereinafter referred to as 'the Act'), on 23.01.2003 and final declaration under Section 6(1) of the Act was issued on 20.06.2003. The LAO determined the market value and passed -5- NC: 2025:KHC:41247-DB M.F.A. No.1754/2017 C/W M.F.A. No.1311/2016 HC-KAR an award on 24.05.2004 awarding total compensation of Rs.7,63,215/-. The claimants sought a reference under Section 18(1) of the Act. The Reference Court recorded the evidence. The claimant No.3 examined himself as PW-1, got marked Exs.P1 to P14. The respondent did not adduce oral evidence but with consent got marked Exs.R1 and R2. The Reference Court, on appreciation of the oral and documentary evidence re-determined the market value of the acquired land at Rs.10,00,000/- per acre and also awarded statutory benefits. Being aggrieved, the claimants as well as State are in appeal.
4. Sri.A.Madhusudhan Rao, learned counsel appearing for the claimants submits that the Reference Court has committed a grave error in awarding meagre compensation of Rs.10,00,000/- per acre without appreciating the fact that the land in question is abutting Narasapura town which was used for the purpose of touring talkies which is evident from Exs.P1 and P2. It is further submitted that the claimants have produced the sale deeds at Exs.P11 and P12 which demonstrate that the land measuring 2 acres 28½ guntas was sold at Rs.1,41,44,000/- in the year 2009 and similarly under Ex.P12, -6- NC: 2025:KHC:41247-DB M.F.A. No.1754/2017 C/W M.F.A. No.1311/2016 HC-KAR 1 acre 24 guntas of land was sold at Rs.16,00,000/- in the year 1999 and considering these evidence, the compensation is required to be re-determined atleast at Rs.25,00,000/- per acre. It is also submitted that the Reference Court has failed to appreciate the fact that the land was having non-agricultural potential. Hence, he seeks to allow the appeal filed by the claimants by dismissing the appeal filed by the State.
5. Per contra, Smt.Prathiba R.K., learned Additional Government Advocate for the respondent-State submits that the Reference Court, without any justifiable reason has enhanced the market value of the land in question at Rs.10,00,000/- per acre. It is submitted that the LAO has considered the sale statistics of Narasapura Village for the relevant period and awarded compensation of Rs.1,26,000/- per acre for dry land and Rs.2,00,000/- per acre for wet land. It is further submitted that Exs.P11 and P12 cannot be the basis to determine the market value as they are much prior and much later to the preliminary notification in question. Hence, she seeks to dismiss the appeal filed by the claimants by allowing the appeal of the State.
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6. We have heard the arguments of the learned counsel for the appellants-claimants, the learned Additional Government Advocate for the respondent-State and perused the material available on record including the original record of the Reference Court. We have given our anxious consideration to the submissions made on both sides.
7. The only point that arises for consideration in these appeals is:
"Whether the impugned judgment and award of the Reference Court calls for any interference?"
8. The answer to the above point is answered in the affirmative for the following reasons:
a. Before adverting to the issue involved in these appeals, it would be useful to refer to the relevant paragraphs of the decision of the Apex Court in CHIMANLAL HARGOVINDDAS vs. SPECIAL LAND ACQUISITION OFFICER, POONA & ANOTHER1, as under:
"The following factors must be etched on the mental screen:1
(1988) 3 SCC 751 -8- NC: 2025:KHC:41247-DB M.F.A. No.1754/2017 C/W M.F.A. No.1311/2016 HC-KAR (1) A reference under section 18 of the Land Acquisition Act is not an appeal against the award and the Court cannot take into account the material relied upon by the Land Acquisition officer in his Award unless the same material is produced and proved before the Court.
1. By Certificate under Article 133( l)(a) of the Constitution of India as it existed at the material time. (2) So also the Award of the Land Acquisition officer is not to be treated as a judgment of the trial Court open or exposed to challenge before the Court hearing the Reference. It is merely an offer made by the Land Acquisition officer and the material utilised by him for making his valuation cannot be utilised by the Court unless produced and proved before it. It is not the function of the Court to suit in appeal against the Award, approve or disapprove its reasoning, or correct its error or affirm, modify or reverse the conclusion reached by the Land Acquisition officer, as if it were an appellate court. (3) The Court has to treat the reference as an original proceeding before it and determine the market value afresh on the basis of the material produced before it. (4) The claimant is in the position of a plaintiff who has to show that the price offered for his land in the award is inadequate on the basis of the materials produced in the Court. Of course the materials placed and proved by the other side can also be taken into account for this purpose. (5) The market value of land under acquisition has to be determined as on the crucial date of publication of the notification under sec. 4 of the Land Acquisition Act (dates of Notifications under secs. 6 and 9 are irrelevant). (6) The determination has to be made standing on the date line of valuation (date of publication of notification under Section 4) as if the valuer is a hypothetical purchaser willing to purchase land from the open market and is prepared to pay a reasonable price as on that day. It has -9- NC: 2025:KHC:41247-DB M.F.A. No.1754/2017 C/W M.F.A. No.1311/2016 HC-KAR also to be assumed that the vendor is willing to sell the land at a reasonable price.
(7) In doing so by the instances method, the Court has to correlate the market value reflected in the most comparable instance which provides the index of market value.
(8) only genuine instances have to be taken into account. (Some times instances are rigged up in anticipation of Acquisition of land).
(9) Even post notification instances can be taken into account (1) if they are very proximate,(2) genuine and (3) the acquisition itself has not motivated the purchaser to pay a higher price on account of the resultant improvement in development prospects.
(10) The most comparable instances out of the genuine instances have to be identified on the following considerations:
(i) proximity from time angle,
(ii) proximity from situation angle.
(11) Having identified the instances which provide the index of market value the price reflected therein may be taken as the norm and the market value of the land under acquisition may be deduced by making suitable adjustments for the plus and minus factors vis-a-vis land under acquisition by placing the two in juxtaposition. (12) A balance-sheet of plus and minus factors may be drawn for this purpose and the relevant factors may be evaluated in terms of price variation as a prudent purchaser would do.
(13) The market value of the land under acquisition has there after to be deduced by loading the price reflected in the instance taken as norm for plus factors and unloading it for minus factors
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NC: 2025:KHC:41247-DB M.F.A. No.1754/2017 C/W M.F.A. No.1311/2016 HC-KAR (14) The exercise indicated in clauses (11) to (13) has to be undertaken in a common sense manner as a prudent man of the world of business would do. We may illustrate some such illustrative (not exhaustive) factors:
Plus factors Minus factors
1. smallness of size. 1. largeness of area.
2. proximity to a road. 2. situation in the interior at a
distances from the Road.
3. frontage on a road. 3. narrow strip of land with
very small frontage compared
to death.
4. nearness to developed area. 4. lower level requiring the
depressed portion to be filled
up.
5. regular shape. 5. remoteness from developed
locality.
6. level vis-a-vis land under 6. some special
acquisition. disadvantageous factor
which would deter a
purchaser.
7. special value for an owner of
an adjoining property to whom
it may have some very special
advantage.
(15) The evaluation of these factors of course depends on the facts of each case. There cannot be any hard and fast or rigid rule. Common sense is the best and most reliable guide. For instance, take the factor regarding the size. A building plot of land say 500 to 1000 sq.yds. cannot be compared with a large tract or block of land of say l000 sq. yds or more. Firstly while a smaller plot is within the reach of many, a large block of land will have to be developed by preparing a lay out, carving out roads, leaving open space, plotting out smaller plots, waiting for purchasers (meanwhile the invested money will be blocked up) and the hazards of an entrepreneur. The factor can be discounted by making a deduction by way of an allowance at an appropriate rate ranging approx. between 20% to 50% to account for land required to be set apart for carving out lands and plotting out small plots. The discounting will to some extent also depend on whether it is a rural area or urban area, whether building activity is picking up, and whether waiting period during which the capital of the
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NC: 2025:KHC:41247-DB M.F.A. No.1754/2017 C/W M.F.A. No.1311/2016 HC-KAR entrepreneur would be looked up, will be longer or shorter and the attendant hazards.
(16) Every case must be dealt with on its own facts pattern bearing in mind all these factors as a prudent purchaser of land in which position the Judge must place himself. (17) These are general guidelines to be applied with understanding informed with common sense."
Keeping in mind the broader guidelines laid down by the Hon'ble Supreme Court in the aforesaid decision, we consider the case on hand.
b. It is not in dispute that the subject matter of land owned by the respondent is measuring 3 acres 5 guntas in Sy.No.222 of Narasapura Village, Narasapura Hobli, Kolar Taluk which was acquired by the State Government by issuing preliminary notification under Section 4(1) of the Act, on 23.01.2003 and final declaration under Section 6(1) of the Act was issued on 20.06.2003. The LAO determined the market value and passed an award on 24.05.2004 awarding total compensation of Rs.7,63,215/-. The reference Court enhanced the compensation to Rs.10,00,000/- per acre.
c. The claimants adduced the oral evidence of claimant No.3 which indicates that the acquired land was
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NC: 2025:KHC:41247-DB M.F.A. No.1754/2017 C/W M.F.A. No.1311/2016 HC-KAR used for non agriculture purpose and the property is fenced with stone slabs and portion of the land was used for touring talkies. The aforesaid evidence indicates that the acquired land abuts to the town limits of Narasapura. The evidence further indicate that towards the eastern side of the land in question Vemgal main road is situated and on southern side national highway is situated at a distance of 300 mtrs. The cinema theater of Ashwathnarayan Shetty abuts to the acquired land. The Narasapura bus stand, commercial complex, shops, panchayath office, police station, hospital are situated within the distance of 100 mtrs. The claimant No.3 deposed that the Karnataka Industrial Areas Development Board (for short 'KIADB') and housing board acquired lands in neighboring villages and the compensation is fixed at Rs.30,00,000/- per acre. Also number of layouts are formed in the acquired land and the sites of 30 x 40 feet have been sold at Rs.12,00,000/- to Rs.15,00,000/- per site. The said witness has been cross examined by the respondent and nothing was elicited to disbelieve the evidence of PW.1. It is to be noticed that the respondent
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NC: 2025:KHC:41247-DB M.F.A. No.1754/2017 C/W M.F.A. No.1311/2016 HC-KAR has not adduced oral evidence before the reference Court. Hence, the contention of the learned AGA that the sales statistics average relied by the Land Acquisition Officer while passing the award is required to be considered, has no merit as the Land Acquisition Officer has not entered the witness box by producing sales statistics or the other documentary evidence to justify the award of compensation. The claimants placed reliance on Ex.P1 to Ex.P5 which indicate that the acquired land is abutting to Narasapura town and within the village limits. The aforesaid exhibits corroborates with the oral testimony of PW.1 which indicates that the acquired land was having non agriculture potential. Ex.P6 is the notice issued by KIADB to the land owners under Section 29 (2) of the Karnataka Industrial Areas Development Board Act, 1966 (for short 'the KIADB Act') which indicate that the KIADB has fixed consent market value of the land acquired by it at Rs.29,00,000/- per acre. It is to be noticed that the said land was acquired under the preliminary notification dated 06.09.2006 as it is evident from Ex.P7 and the final notification on 25.08.2007 as it
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NC: 2025:KHC:41247-DB M.F.A. No.1754/2017 C/W M.F.A. No.1311/2016 HC-KAR is evident from Ex.P8. The subject matter of the land acquired is on 23.01.2003 and the aforesaid exhibit is pertaining to 2006, and there is a gap of three years. Ex.P11 is the sale deed dated 25.02.2009 pertaining to the Sy.No.35/1 measuring 2 acre 28½ guntas of Byrasandra Village, Narasapura Hobli, Kolar Taluk and the sale consideration is 141.44 Lakhs. The sale deed at Ex.P11 is again not of the same village but adjacent village and the distance between the Byrasandra village and Narasapura village is not forthcoming from the evidence on record. It is also to be noticed that the sale deed is of the year 2009 and acquisition in question is of the year 2003, and there is a gap of six years. Similarly, Ex.P12 dated 23.09.1999 is pertaining to land measuring 1 acre 24 guntas of Byrasandra Village and the sale consideration is Rs.16,00,000/- . Ex.P12 is nearly 3½ years prior to the issuance of preliminary notification dated 23.01.2003 and it is not in dispute that the said land is converted for non agriculture purpose. Exs.P13 and 14 are the awards passed under the provisions of the National Highways Act, 1956 and the acquisition is of the
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NC: 2025:KHC:41247-DB M.F.A. No.1754/2017 C/W M.F.A. No.1311/2016 HC-KAR year 2006 and as per the award, Rs.25,00,000/- per acre was the compensation awarded. Admittedly, the aforesaid exhibits are not contemporaneous documents to place full reliance to arrive at a conclusion and to determine the market value of the land in question. The KIADB acquired the land of the adjacent village in the year 2006 and consent award was passed by fixing the market value at Rs.29,00,000/- per acre which is 3 years after the preliminary notification in question. Ex.P11-sale deed of the year 2009 with regard to the land in Byrasandra Village which is on the higher side, cannot be the basis to arrive at a conclusion with regard to determine the market value of the land in question. Ex.P12 which is of the year 1999, and the land was sold approximately at Rs.10,00,000/- per acre can be considered for the purpose of arriving at a conclusion with regard to the market value of the land in question. However, 3½ years escalation to the aforesaid consideration at the rate of 15% approximately is required to be considered to determine the market value of the land in question. Similarly, Exs.P13 and P14 are the awards passed by the
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NC: 2025:KHC:41247-DB M.F.A. No.1754/2017 C/W M.F.A. No.1311/2016 HC-KAR authority under the provisions of NHAI. Again the acquisition is of the year 2006 wherein Rs.25,00,000/- per acre compensation has been awarded and the lands covered under the aforesaid award are of different village. Considering Exs.P13, 14 as well as Ex.P6, if the principle of de-escalation at the rate of 10% is applied, the approximate market value can be arrived. On re- appreciation of the oral and documentary evidence on record, we are of the considered view that the claimants have neither produced sale deeds of Narasapura Village nor produced guidance value notification of Narasapura Village. Hence, it would be difficult to arrive at the correct market value of the land in question. Considering Exs.P6, P12, P13 and P14, the oral testimony of PW-1 and our reasons recorded supra, we are of the considered view that the interest of justice would be met if we re- determine the market value of the land in question at Rs.16,00,000/- per acre. We have considered the acquired land as having non-agricultural potential.
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9. For the aforementioned reasons, MFA No.1311/2016 is allowed-in-part with costs.
MFA No.1754/2017 is dismissed.
The impugned judgment and award of the Reference Court dated 09.10.2015 passed in LAC No.1/2009 by the I Additional Senior Civil Judge, Kolar, is modified by re- determining the market value of the land in question at Rs.16,00,000/- (Rupees Sixteen Lakhs only) per acre with solatium, statutory benefits and interest as per the provisions of the Land Acquisition Act, 1894.
The respondents are directed to deposit the compensation amount in terms of the judgment and award within a period of 8 weeks from the date of receipt of copy of this order.
Sd/-
(ANU SIVARAMAN) JUDGE Sd/-
(VIJAYKUMAR A. PATIL) JUDGE RV/ABK List No.: 1 Sl No.: 2