Kerala High Court
State Of Kerala vs Mohanan on 13 March, 2025
Author: A.K.Jayasankaran Nambiar
Bench: A.K.Jayasankaran Nambiar
LA.APP. NO. 267 OF 2017 1 2025:KER:21364
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR
&
THE HONOURABLE MR. JUSTICE EASWARAN S.
THURSDAY, THE 13TH DAY OF MARCH 2025 / 22ND PHALGUNA, 1946
LA.APP. NO. 267 OF 2017
AGAINST THE JUDGMENT DATED 05.08.2016 IN LAR NO.21 OF 2010 OF
PRINCIPAL SUB COURT, KOLLAM
APPELLANT/RESPONDENT IN L.A.R:
STATE OF KERALA
REPRESENTED BY THE DISTRICT COLLECTOR,KOLLAM.
BY ADV GOVERNMENT PLEADER SRI.T.K.SHAJAHAN, SR
1. RESPONDENTS/CLAIMANTS IN L.A.R:
1 MOHANAN
S/O.DAMODHARAN, "SOORYA", KOONAYIL, NEDUNGOLAM,
PARAVOOR, KOLLAM-691334.
2 SUDHADRA LILLY
W/O.MOHANAN, "SOORYA", KOONAYIL,NEDUNGOLAM, PARAVOOR,
KOLLAM-691334.
3 STATE BANK OF INDIA
REPRESENTED BY THE ASSISTANT GENERAL MANAGER, RETAIL
ASSETS AND SMALL ENTERPRISES, CITY CREDIT CENTER
(RASSMECCC), 2ND FLOOR, RAVI'S ARCADE, NEAR IRON
BRIDGE, KOLLAM-691013.
4 SALIM
S/O.JAFERKUTTY, SAMSAM HOUSE, CHATHINAMKULAM CHERRY,
MANGADU VILLAGE, KOLLAM-691015.
BY ADVS.
SRI.A.MUHAMMED RAFFI
LA.APP. NO. 267 OF 2017 2 2025:KER:21364
SRI.K.SIJU
SRI.R.S.KALKURA, SC, SBI
THIS LAND ACQUISITION APPEAL HAVING COME UP FOR ADMISSION ON
13.03.2025, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
LA.APP. NO. 267 OF 2017 3 2025:KER:21364
JUDGMENT
Easwaran S., J.
This appeal is preferred by the State aggrieved by the judgment and
decree of the Sub Court, Kollam, in L.A.R.No.21 of 2010.
2. The brief facts necessary for the disposal of the appeal are as
follows:
An extent of 37.42 Ares of land in Re.Sy.No.251/14 of Paravoor Village
in Kollam Taluk was acquired for rehabilitation of Tsunami victims. Notification
under Section 4(1) of the erstwhile Land Acquisition Act was issued on
10.10.2007. The Land Acquisition Officer fixed the land value @ Rs.25,204/- per
Are. Thus the total compensation of Rs.13,50,587.40/- was granted in favour of
the land owner. Dissatisfied with the compensation awarded by the Land
Acquisition Officer the claimants sought reference under Section 18 of the
erstwhile Land Acquisition Act which was numbered as LAR No.21 of 2010.
3. Before the Reference Court, the claimants produced Exts.A1 to A6
documents. The claimants had mortgaged the land acquired in favour of the
State Bank of India, and therefore, the State Bank of India, SMECC Branch,
Kollam, was also impleaded as an additional 3 rd respondent in the reference. On
behalf of the bank Exts.B1 to B11 documents were produced. On behalf of the
respondent State Exts.R1, R1(a), and R1(b) documents were marked. The
claimants also sought for an appointment of an Advocate Commissioner for local
inspection, who filed Ext.X1 (a) report. AW1 to AW3 were examined on behalf of
the claimants whereas no oral evidence was adduced on behalf of the State.
LA.APP. NO. 267 OF 2017 4 2025:KER:21364
4. The Reference Court relied on Ext.B11 valuation statement of the
State Bank of India and refixed the compensation @ Rs.1,54,437.5 per Are
(Rs.62,500/- per cent). It is as against the enhancement of the market value
fixed by the Reference Court that the State has come up in the present appeal.
The claimants have also preferred LA. App. No.391 of 2017 is seeking for
enhancement, which we will be considering it by a separate judgment.
5. Heard Sri.T.K.Shajahan, the learned Senior Government Pleader
appearing on behalf of the State and Sri.Siju Kamalasanan, the learned counsel
appearing for the claimants.
6. The learned Senior Government Pleader pointed out that the
Reference Court erred in relying on the valuation statement produced on behalf
of the bank for the purpose of fixing the land value at Rs.1,54,437.5 per Are.
The Land Acquisition Officer had correctly fixed the land value. The claimants
had failed to adduce any corroborative evidence to support his claim for
enhancement.
7. On the other hand, Sri.K.Siju Kamalasan, appearing for the
appellants, pointed out that the Reference Court had egregiously rejected
Ext.A1 certified copy of Sale Deed No.3831/2001, which formed the basis of the
fixation of the land value in L.A.R. Nos.7/ 2006 and 8/2006 in respect of the land
in the same village, which was acquired for the purpose of Paravooor Municipal
bus stand. It is further pointed out that as per Ext.X1(a) report of the Advocate
Commissioner, the commercial importance of the land acquired, as well as the
proximity of the land acquired with that of the land in Ext.A1 document is
clearly established. In the absence of any objection by the State against the
LA.APP. NO. 267 OF 2017 5 2025:KER:21364
report of the Advocate Commissioner, the Reference Court could not have
rejected Ext.A1 document.
8. We have considered the rival submissions made across the bar and
perused the records in the reference case.
9. On a consideration of the rival submissions, we are of the view that
the appeal preferred by the State has to fail for the following reasons. Ext.B11
is a valuation statement taken by the bank prior to the sanctioning of the credit
facility for which the land acquired was mortgaged. The valuation taken by the
bank do have a higher evidenciary value since it is issued after considering the
market value of the land. When Ext.B11 is analysed along with Exts.A1 and A4,
we find that the Reference Court could not have rejected Exts.A1 and A4 and
relied exclusively on Ext.B11 valuation statement. However, the extent to
which the claimants are entitled to enhancement based on Exts.A1 and A4 will
be separately decided by us in L.A. App.No.391 of 2017, depending upon the
evidenciary value of Exts.A1 to A4 documents. In the present appeal, we need
to consider only whether the Reference Court was justified in relying on
Ext.B11 valuation statement. As stated above, the valuation statement being a
relevant material considered by the bank for the purpose of sanctioning of
credit facility, we see no infirmity in the order passed by the Reference Court
relying on Ext.B11 and fixing the market value of the land @ Rs.1,54,437.5 per
Are. Therefore, we are of the considered view that there is no merit in the
appeal preferred by the State, and accordingly, the same is liable to be
dismissed.
10. However, having said so, we found that the bank has got a
LA.APP. NO. 267 OF 2017 6 2025:KER:21364
preferential claim that priority for receiving the compensation in terms of
Section 73 of the Transfer of Property Act. It is also brought to our notice that
the bank has already prefered its claim before the Land Acquisition Officer and
has received the compensation so determined by the Land Acquisition Officer.
Since we are dismissing the appeal preferred by the State, we notice that the
claimants are entitled to get an amount of Rs.57,79,032.54 towards the
enhanced compensation as fixed by the Reference Court.
11. Considering the predicament of the claimants and having noticed
the fact that the entire property, which stood mortgaged with the State Bank of
India was acquired by the State for the purpose of Tsunami rehabilitation, with
an endeavor to sort out the issues between the claimants and the bank, we
had by order dated 12.03.2025 directed the competent authority of the bank, to
appear before us today and appraise us with regard to the liability of the
claimants to the bank and the entitlement of the claimants for any one time
settlement. In pursuance of our order, Sri.Prabhu Sreenivas, the Assistant
General Manager of the SMECC Branch, Kollam, appeared before us today
and appraised us that the bank is prepared to offer the one time settlement
under the RIN SAMADHAN Scheme. Under the said Scheme, the bank has
worked out the liability of the claimants, and it is quantified at Rs.45 lakhs
subject to the condition that the claimants give a formal application to settle
the accounts and pays the aforesaid amount within 90 days from the date of
application. We take note of the said offer of the bank and direct the claimants
to prefer an application within a period of one week from today and direct the
bank to accept the same and pass consequential orders on the said application.
Taking note of the peculiar circumstances arising out of the case, the State is
directed to deposit an amount of Rs.45 lakhs directly to the State Bank of
LA.APP. NO. 267 OF 2017 7 2025:KER:21364
India, SMECC Branch, Kollam, within a period of 10 weeks from today. We
make it clear that the deposit, as directed, is solely with a view to enable the
claimants to get the benefit of the one time settlement offered by the bank in
respect of the loans availed by him. The deposit by the State shall be without
prejudice to the right to prefer an appeal against the final judgment in the
present appeal and also their right to seek a refund of the excess amounts, if
any, by way of compensation from the claimants if ultimately they succeed in
the appeal. If, in any event, the claimants do not prefer any application for the
bank for settlement of the amount under the RIN SAMADHAN Scheme, he will
lose the benefit of the judgment.
Sd/-
DR. A.K.JAYASANKARAN NAMBIAR
JUDGE
Sd/-
EASWARAN S.
JUDGE
mns
