Vijay Singh And Ors. vs Union Of India (Uoi) And Ors.
2004 Latest Caselaw 561 Del

JUDGMENT

R.C. Jain, J.

1. These appeals under Section 54 of the Land Acquisition Act, 1894 (hereinafter referred to as the "Act") arise from a common judgment dated 12.5.1998 passed by the learned Additional District Judge, Delhi, in LAC No. 55/1996 thereby disposing of a Reference under Section 18 of the Act.

2. Land comprised in different Khasra numbers situated in the revenue estate of village Jagatpur, Shahdara, Delhi, was acquired for public purpose namely for construction of embankment, vide notifications dated 12.1.1984 issued under Sections 4 and 6 of the Act. The Land Acquisition Collector assessed the market value of the acquired land @ Rs.10,000/- per bigha and awarded compensation at the said rate besides other statutory benefits in accordance with law. A reference under Section 18 of the Act having being made, the learned Additional District Judge enhanced the compensation to Rs. 22,575/- per bigha. Still not satisfied, the land owners have filed the appeals claiming further enhancement of compensation @ Rs.50,000/- per bigha along with other statutory benefits. On the other hand respondent/UOI has filed appeals challenging the judgment of the learned Additional District Judge so far as it has awarded the compensation at the enhanced rate.

3. We have heard Mr. Om Parkash, learned counsel representing the appellants/land-owners and Mr. Sanjay Poddar, learned counsel representing the respondent/UOI.

4. The first question which arises for our consideration in these appeals would be whether the assessment of the market value of the acquired land at the rate of Rs. 22,575/- per bigha by the learned Additional District Judge is correct and just? Our answer to this question would necessarily be a plain "NO". This is for more than one reason. In order to substantiate their claim for enhanced compensation, the land owners had mainly relied upon three judgments Ex.A-1, Ex.A-2 and Ex.A-3 rendered by three courts of co-ordinate jurisdiction that is Additional District Judges i.e. in LAC No. 135/1982 titled as Smt. Attar Kali & Ors. Vs. Union of India decided on 28th July, 1989, Judgment in LAC No. 130/1982 tilted as Shri Mansa Ram & Ors. Vs. Union of India decided on 31st October, 1990 and judgment in LAC No. 146/1991 tilted as Shri Khem Chand & Ors. Vs. Union of India decided on 25th September 1993. Judgments Ex.A-1 and Ex.A-2 pertained to the acquired land of village Wazirabad acquired vide a notification dated 15th February, 1979, and the Additional District Judge had assessed the market value of the land @ Rs.17,000/- per bigha in respect of the said land. The third judgment Ex.A-3 pertained to the land of village Sabhapur which was acquired vide a notification dated 10th August, 1983, and for which the learned Additional District Judge had assessed the market value @ Rs.21,500/- per bigha.

5. On the other hand respondent/Union of India had relied on the sale-deed Ex.R-1 in respect of the land of village Wazirabad through which the land measuring 1,000 sq.yds. e.g. one bigha approximately comprised in Khasra No. 264/228/173-Min was sold for a consideration of Rs.10,000/- on 4th January, 1984. The learned Additional District Judge discarded this piece of evidence as inadmissible and also on the ground that it was not produced before the land Acquisition Collector and the land owners were not party to the said sale-deed. Yet another reason for discarding the sale-deed and not relying upon it as basis for assessing the market value of the land in question was that the sellers as well as the purchasers tend to under-value the property in the sale-deed with the object of saving income tax and stamp duty. Surprisingly the Court ignoring the judgments Ex.A-1 and Ex.A-2 pertaining to village Wazirabad land, chose to rely upon the judgment Ex.A-3 pertaining to land of village Sabhapur.

6. Mr.Om Parkash, learned counsel for the appellant has fairly conceded that in view of the factual position that there had not been any sale transaction of the land of village Jagatpur during the relevant period or a little earlier the Land Acquisition Collector had to make his award on the basis of the sale deed in respect of the land of adjoining village Wazirabad and therefore, reliance on the judgment of Ex.A-3 in respect of the land of Sabhapur was wholly misplaced. On the face of the above circumstances, the learned Court below ought to have relied either on the judgment Ex.A-1 or Ex.A-2 for assessing the market value of the land in question. Mr. Poddar, learned counsel for the respondent/UOI also made a similar submission.

7. It is pertinent to mention that in the Award No. 37/84-85 in respect of the land in question, the Land Acquisition Collector has noticed that the land in question adjoins to the acquired land of village Wazirabad and in absence of any direct evidence about the land of village Jagatpur coming forth, he found the transaction of village Wazirabad as more apt for the purpose of assessing the market value of the land in question. It is admitted case of the parties that there were no sale transactions in respect of the land of village Jagatpur for the relevant period and no other evidence except the evidence in respect of the land of village Wazirabad was available, the land Acquisition Collector was fully justified in giving parity to the acquired land with the land of village Wazirabad as Jagatpur and Wazirabad are adjoining villages. We have, therefore, no hesitation in holding that the learned Additional District Judge has erred in discarding the judgments Ex.A-1, Ex.A-2 pertaining to the acquired land of village Wazirabad and basing its finding on the irrelevant judgment Ex.A-3 pertaining to the land of village Sabhapur. Accordingly the impugned judgment so far as it has assessed the value of the acquired land @ Rs.22.575/- per bigha based on Ex.A-3 cannot be sustained and is liable to be set aside. We hold that the market value of the land of village Wazirabad @ Rs.17,000/- per bigha as depicted in judgment is Ex. A-1 and Ex.A-2 could form the valid basis for assuming the market value of this land in the case in hand.

8. Now, the ultimate question which remains to be considered is as to what should be the just and fair market value of the acquired land at the time of its acquisition e.g. on the date of issuance of the notification under Sections 4 and 6 dated viz. 12.1.1984. Mr. Om Parkash, learned counsel for the appellant on the strength of the copies of the judgments Ex.A-1 and Ex.A-2 of village Wazirabad has strenuously urged that the market value of the acquired land can be safely determined on the basis of the value assessed in the judgments Ex.A-1 and Ex.A-2 in respect of the land of village Wazirabad which was acquired vide an earlier notification in the year 1979 and by granting enhancement at the appropriate rate to say at the rate of 12% per annum for about five years for the period from 1979 to 1984. On the other hand Mr. Sanjay Poddar, learned counsel for the respondent/UOI has vehemently urged that there is no rule of universal application for grant of escalation @ 12% per annum and therefore, it will not be proper to grant escalation at the said rate of 12% per annum in each and every case.

9. The question as to what should be just and reasonable rate of escalation per annum has been agitating the mind of this Court, various other courts and even the apex court and no hard and fast rule or straight jacket formula has been evolved or firm basis found for fixing the rate of escalation. The courts have been granting escalations at different rates ranging from 6% to 30% per annum depending upon the facts and circumstances of each case, and if we may say so, even this has been often done on guess work rather than on any firm basis or evidence adduced by the parties. This is so apparent from the judgments relied upon by both sides. In the case of Tindey & Ors. Vs. Union of India & Anr. 2000 (54) a Division Bench of this Court allowed increase escalation @ 12% per annum for the period from 1961 to 1976 based on another Division Bench Judgment of this Court in Prakash Chand Kashyap Vs. Union of India AIR 1988 Delhi 316 where the escalation of 12% was considered as reasonable inspite of the past practice of the courts allowing escalation at the rate of 1,000/- per bigha. In the case of Rameshwar Solanki's & Anr. Vs. Union of India & Ors , the Court has observed that it would be appropriate to discard the practice of granting escalation at the rate of Rs.1,000/- per bigha and it would rather be appropriate to allow escalation at the rate of 12% per annum which was the rate flowing from certain statutory provisions. In the case of Bedi Ram Vs. Union of India and Anr. 1993 (2001) DLT 150, a Division Bench of this Court reiterated the principal of allowing escalation @ 12% per annum for each year while assessing the fair market value of the acquired land. The Supreme Court in the case of Mehtab Singh Vs. State of Haryana AIR 1995 SCC 677 considered this question of escalation more particularly with reference to the provisions of Section 23(2) and Section 28 of the Act and held that the Amendment Act of 1984 is explicit in terms of the limited retrospectivity provided in the amending provisions do not permit adoption of 12% increase in price in each and every acquisition. The Court further held that if it was so intended the legislature would have expressly provided so. The Court decried that rule and expressed its disapproval for its universal application for all acquisitions.

10. Mr. Sanjay Poddar, learned counsel for the respondent/UOI has heavily relied upon a few decisions of the Supreme Court first in the case of Special Land Acquisition Officer, BTDA, Bagalkot Vs. Mohd. Hanif Sahib Bawa Sahib . In that case the Reference Court and the High Court had granted escalation @ 10% per annum for every subsequent year after the base year and the Apex Court on the facts and circumstances of the case held that such an increase was neither excessive nor unreasonable. In Civil Appeal No.4310/1997 titled as Land Acquisition Officer Vs. B. Vijender Reddy and Ors. decided on 2.11.2000, the question in regard to the basis for grant of enhancement was considered by the Supreme Court. In para 13 the Supreme Court held as under:

" The first question we proceed to consider is, whether the High Court was right to enhance the rate from the rate recorded in Exhibits A-1 and A-2 by Rs. 10,000/- per acre per year for three years. It is true, in the fixation of rate of compensation under the Land Acquisition Act, there is always some element of guesswork. But that has to be based on some foundation. It must spring from the totality of evidence, the pattern of rate, the pattern of escalation and escalation of price in the years preceding and succeeding Section 4 notification etc. In other words, the guesswork could reasonably be inferable from it. It is always possible to assess the rate within this realm. In the present case, we find there are three exemplars i.e. Exhibits A-1 and A-2 which are three years preceding the date of notification and Exhibit A-3 which is of the same point of time when Section 4 notification was issued."

11. On the facts of the said case the Court held that as there was no escalation of value of land during the relevant period of 1980-1983 hence it was not possible to accept the enhancement granted by the High Court @ Rs.10,000/- per acre per annum for the three years and held that the market value could remain at Rs.60,000/- per acre. In CW No. 1802/1994 titled as V. G. Kulkarni Vs. The Spl. Land Acquisition Officer decided on 15.3.1996, the Court observed that with regard to escalation of market price of lands every year it has to be stated that the principle of of taking judicial notice cannot be extended to such a matter also. Further each case has to be considered on its own facts and the claimants would be required to establish by adducing evidence that there was gradual rise in price due to development and constant demand of land in the neighborhood. In that case the High Court has extended the benefit of escalation in price to the claimants by increasing market value by 20% and the same was upheld by the Supreme Court.

12. Mr. Poddar also submitted that the decisions relied upon from the side of the appellant were of their own facts and the petitioner cannot claim escalation @ 12% per annum. In this connection he pointed out that in the case of Bedi Ram (Supra) the escalation of 12% was granted by the Court by taking note of the subsequent acquisitions. Yet another argument by Mr. Poddar, is that having regard to the facts and circumstances of the present case escalation @ 12% per annum would not be justified. He further contended that the land in question was not acquired for the purpose of development of Delhi or developing residential or commercial colony but in fact was acquired for the purpose of construction of embankment which would show that the land in question was low lying river bed land and not agricultural land. This contention is being noticed simply to be rejected because it is not born out from the record that the land in question was river bed or low lying land rather the award of the Land Acquisition Collector itself notices that the land in question is agricultural land at par with the agricultural land of the adjoining village of Wazirabad. Even assuming that the acquired land was of inferior quality than the land of Wazirabad, this would have perhaps been a relevant factor in assessing the market value of the acquired land but not for determining the rate of escalation on the price of land over a period of years.

13. From the above discussion there is no escape from the conclusion that there exists no hard and fast rule or straight jacket formula having the firm legal backing for computing the rate of escalation in the price of acquired land. Such an exercise has to depend on various factos viz. the period for which the escalation is required to be computed, the general rate of growth of money during that period which certainly implies some guesswork. It is a common knowledge that during the period of 1980's the rate of interest was around 10 to 12% per annum. In the case in hand the relevant period is of about 5 years from 1979-1984 and, therefore, we are inclined to hold that the rate of 12% per annum from 1979-1984 would form a just and reasonable basis for the purpose of computing the escalation during this period. Adding the escalation at this rate over the rate of Rs.17,000/- granted vide judgments Ex.A-1 to Ex.A-2 for the acquired land of village Wazirabad in the year 1979, we are of the considered opinion that it would meet the ends of justice if the market value of the acquired land of the land owners is assessed at the rate of Rs.27,200/- per bigha as on the date of its acquisition. We order accordingly.

14. In the result RFA Nos. 477/1998, 478/1998, 480/1998, 487/1998, 510/1998, 524/1998, 560/1998, 612/1998, 615/1998, 616/1998, 617/1998, 619/1998, 620/1998, 621/1998 of the land owners are hereby allowed and the compensation payable to the appellants is assessed @ Rs.27,200/- per bigha. Besides the amount of compensation at the enhanced rate, the appellants shall also be entitled to all other statutory benefits as have been awarded by the learned Additional District Judge, of course on the enhanced amount of compensation. The appellants in these appeals shall also be entitled to proportionate costs.

15. As a result appeals filed by the Union of India, e.g. RFA Nos. 656/1998, 660/1998, 168/2000, 567/1998, 568/1998, 569/1998 are hereby dismissed with no orders as to costs.