KERALA STATE ELECTRICITY BOARD v. OUSEPH KURIAKOSE

## IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE K.T.SANKARAN WEDNESDAY, THE 18TH DAY OF JANUARY 2012/28TH POUSHA 1933 ## **CRP.No. 957 of 2005** ----------------------OPELE.219/2000 OF ADDITIONAL DISTRICT COURT, THODUPUZHA REVISION PETITIONER: RESPONDENT: ---------------------- KERALA STATE ELECTRICITY BOARD, REPRESENTED BY ITS SECRETARY, K.S.E.BOARD THIRUVANANTHAPURAM. ## BY ADV.SRI.S.RAMESH BABU, SC, KSEB RESPONDENT: PETITIONER: -------------- OUSEPH KURIAKOSE, SON OF OUSEPH, KUTTUNGAL HOUSE, MUNIYARA P.O., KONNATHADY VILLAGE, UDUMBANCHOLA TALUK, IDUKKI DISTRICT. BY SRI.M.V.SABU THIS CIVIL REVISION PETITION HAVING BEEN FINALLY HEARD ON 18-01-2012, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: ## **K.T.SANKARAN, J.** ## **-----------------------------------------------------C.R.P. NO. 957 OF 2005 -----------------------------------------------------Dated this the 18[th] day of January 2012** ## **O R D E R** For drawing Koothumkal-Panamkutty 110 KV line, the Kerala State Electricity Board (hereinafter referred to as 'the Board') cut and removed trees from the property belonging to the respondent. 102 yielding coffee plants, 117 pepper vines, 61 coconut trees, 3 cocoa plants, one cashew tree, 11 jack trees, two mango trees and other non-yielding trees were cut and removed. The Board awarded a compensation of `1,39,332/- to the respondent. Dissatisfied with the compensation awarded by the Board, the respondent filed O.P.(Ele.) No.219 of 2000 before the Court of the Additional District Judge, Thodupuzha claiming enhanced compensation of Rupees Nine lakhs. He also claimed interest at 15% per annum. 2. The District Court raised the following points for consideration: - “1) Whether the yield assessed by the respondent is low? C.R.P. NO.957 OF 2005 :: 2 :: - 2) Whether the price fixed by the respondent for the agricultural produces is reasonable? - 3) Whether the deductions made by the respondent are high? - 4) Whether the multiplier adopted by the respondent is reasonable? - 5) Whether the drawing of the line has diminished the value of the petitioner's land? - 6) What is the amount, to which the petitioner is entitled as additional compensation? - 7) What is the rate of interest, if any, payable on the additional compensation? - 8) What is the rate of interest, if any, payable on the compensation already paid?” 3. Point Nos.1 and 5 were found against the claimant. 4. While dealing with point No.2, the court below held that the C.R.P. NO.957 OF 2005 :: 3 :: price of coffee should be fixed at `30/- per Kg., coconut at `5/- per nut, arecanut at 50 paise per nut and cashew at `30/- per Kg. The claimant relied on Ext.A2 price list issued by the Coffee Board, Bangalore in support of his claim of `37.36 per Kg. of coffee. The Board had awarded only `15/- per Kg. of coffee. The District Court was not inclined to accept the price list issued by the Coffee Board on the ground that the varieties of coffee shown in Ext.A2 were of robesta coffee and also on the ground that there is no evidence to show the variety of the coffee plants which were cut and removed by the Board. The Board also did not say which was the variety of coffee in the present case. Taking into account the facts and circumstances of the case and the materials on record, the District Court fixed the price of coffee at `30/- per Kg. As regards the value of coconut, arecanut and cashew nut, the claimant relied on Ext.A1 Gazette notification dated 30.1.2001 showing the price of the above items as on April, 1999. Ext.A1 was not relied on by the District Court on the ground that the date of cutting of the trees was not in April 1999. (Learned counsel for the Board submitted that the date of cutting was on 26.1.1999.) Relying on the earlier awards passed C.R.P. NO.957 OF 2005 :: 4 :: by the Court, prices of coconut, arecanut and cashew nut were fixed at `5/- per nut, `0.50 per nut and `30/- per Kg. respectively. 5. Point No.3 was answered by the court below in favour of the claimant. It was held that the deduction for expenses in the case of coconut, cardamom, arecanut, coffee and other improvements should be fixed at 40%, 35%, 30% and 25% respectively. The Board had made deductions at 60% for coffee and cardamom and at 43.75% for other improvements. The court below held that the deductions made by the Board were very high. It was also held that the claimant is not a big landlord, but he is a person who did the agricultural operations by himself. 6. The compensation was fixed on annuity basis. The Board took the rate of return at 10%. The District Court fixed the rate of return at 5% as held in the larger Bench decision of this Court in **Kumba Amma** v. **Kerala State Electricity Board** (2000 (1) KLT 542). :: 5 :: C.R.P. NO.957 OF 2005 7. The court below also awarded interest at 9% from the date of cutting of trees. 8. The court below awarded an enhanced compensation of `1,49,130/-. The order passed by the court below was challenged by the Board in the Revision. The Revision was dismissed by a learned single Judge of this Court as per the order dated 30.11.2005. The matter was taken to the Honourable Supreme Court in Civil Appeal No.900 of 2008. The Honourable Supreme Court remitted the matter to the High Court for fresh consideration in the light of the judgment in **K.S.E.B** . v. **Livisha** ((2007) 6 SCC 792 = 2007(3) KLT 1 (SC)). 9. In **K.S.E.B** . v. **Livisha** ((2007) 6 SCC 792 = 2007(3) KLT 1 (SC)), the Supreme Court referred to the decision of the larger Bench of the High Court in **Kumba Amma** v. **Kerala State Electricity Board** (2000 (1) KLT 542) and the earlier decisions of the Kerala High Court. The Supreme Court held thus: :: 6 :: ## C.R.P. NO.957 OF 2005 “10. The situs of the land, the distance between the high voltage electricity line laid thereover, the extent of the line thereon as also the fact as to whether the high voltage line passes over a small track of land or through the middle of the land and other similar relevant factors in our opinion would be determinative. The value of the land would also be a relevant factor. The owner of the land furthermore, in a given situation may lose his substantive right to use the property for the purpose for which the same was meant to be used. 11. So far as the compensation in relation to fruit bearing trees are concerned the same would also depend upon the facts and circumstances of each case. 12. We may, incidentally, refer to a recent decision of this Court in _Land Acquisition Officer, A.P. v. Kamandana Ramakrishna Rao & Anr._ reported in 2007 AIR SCW 1145 wherein claim on yield basis has been held to be relevant for determining the amount of compensation payable under the Land Acquisition Act, same principle has been reiterated in _Kapur Singh Mistry v. Financial_ C.R.P. NO.957 OF 2005 :: 7 :: _Commission & Revenue Secretary to Govt. of Punjab & Ors._ 1995 Supp. (2) SCC 635, _State of Haryana v. Gurcharan Singh & Anr._ (1995 Supp. (2) SCC 637) para.4, and _Airports Authority of India v. Satyagopal Roy & Ors._ (2002) 3 SCC 527. In _Airport Authority_ (supra), it was held:- “14. Hence, in our view, there was no reason for the High Court not to follow the decision rendered by this Court in _Gurucharan Singh's_ case and determine the compensation payable to the respondents on the basis of the yield from the trees by applying 8 years' multiplier. In this view of the matter, in our view, the High Court committed error apparent in awarding compensation adopting the multiplier of 18.” 10. In **Kumba Amma** v. **Kerala State Electricity Board** (2000 (1) KLT 542), the Larger Bench held thus: “44. Next, we have to consider what should be the rate of return to be applied in this case. As mentioned earlier, regarding the rate of return, the only contention raised by the petitioners is that it should be C.R.P. NO.957 OF 2005 :: 8 :: 5% as held in 1961 KLT 238 and not the higher rate as ordered in 1981 KLT 646. Even though reliance was placed by the petitioners on AIR 1988 AP 89 in support of their contention that the principle applied in 1981 KLT 646 was not correct, it is not contended by the petitioners before us that in their case, the rate of return as assessed by Jagannadha Rao, J. in AIR 1988 AP 89 should be applied. The dispute in this case arose when trees standing in petitioners’ property were cut down on 9.9.1980. The respondents have not made available before us any material to show that the real rate of interest in 1980 was something different from 5%. Their only contention based on 1981 KLT 646 is that what is relevant is the prevalent rate of interest which was 10%. This contention we have already rejected, as such rate does not take into account the factor of inflation. Under these circumstances, we hold that the rate of interest to be applied in the present case is 5%. We hasten to add that we should not be understood as having laid down 5% as the real rate of interest for subsequent period. The rate of interest applicable in India has been held as 4% by Jagannadha Rao, J. in AIR 1988 AP 89. 11 years have lapsed after the above judgment. Whether it should be the same rate of return that has to be applied for the period before and after the above judgment or C.R.P. NO.957 OF 2005 :: 9 :: whether a higher or lower rate, is a matter to be decided in appropriate cases where relevant data is available. Till such time, the Board will adopt 5% as rate of return. But, we make it clear that cases finally concluded by decisions of the Court will not be reopened.” 11. To a query by the Court, the learned counsel appearing for the Board submitted that after the decision in Kumba Amma's case, the Board has not fixed any rate for the purpose of fixing compensation on annuity basis. However, from the various orders passed in the claims, it is seen that the Board has uniformly adopted 10% even after the decision of the larger Bench in Kumba Amma's case. To that extent, it shows that the Board never cared to follow the larger Bench decision in Kumba Amma's case. ## 12. In **Kumba Amma** v. **Kerala State Electricity Board** (2000 (1) KLT 542), the Larger Bench also noticed as to how the real rate of interest is to be computed and it was held thus: “10. Now, we will consider what is meant by ‘real rate of interest’ and its relevance in computation of C.R.P. NO.957 OF 2005 :: 10 :: compensation. Prof. Paul A. Samuelson defines ‘real interest rate’ as the “money interest rate” minus “the percentage price rise”. Thus, if the money rate is 9% and the annual price rise is 7%, then the true real rate of interest is 9 - 7 = 2%. (See Economics, by Paul A. Samuelson, 11th Edn. (International Student Edition) Page 566).” While fixing 10% as the rate of interest, the Board has not taken into account the rate of interest prevailing and the percentage of inflation. In other words, there is no material to indicate that the Board applied its mind and fixed the rate of interest on the basis of the actual data available as on the date of tree cutting. On the other hand, the Board ritualistically followed 10% as the rate of interest, even ignoring the larger Bench decision in Kumba Amma's case. 13. The learned counsel for the respondent brought to my notice the Monetary Policy Statement 2010-11 issued by the Reserve Bank of India. In paragraph 32 therein, it is stated thus: “32. Notwithstanding the current inflation scenario, it is important to recognise that in the last C.R.P. NO.957 OF 2005 :: 11 :: decade, the average inflation rate, measured both in terms of WPI and CPI, had moderated to about 5 per cent from the historical trend rate of about 7.5 per cent. Against this background, the conduct of monetary policy will continue to condition and contain perception of inflation in the range of 4.0-4.5 per cent. This will be in line with the medium-term objective of 3.0 per cent inflation consistent with India's broader integration into the global economy.” 14. A learned single Judge of this Court, after referring to the decisions in **Kumba Amma** v. **Kerala State Electricity Board** (2000 (1) KLT 542) and **K.S.E.B** . v. **Livisha** ((2007) 6 SCC 792 = 2007(3) KLT 1 (SC)), held in C.R.P.No.892 of 2006 as follows: “5. Perusing the impugned order, it is seen, the Board had assessed the compensation towards the value of trees cut and removed at 10% annuity and the court below taking note of the principles laid down in **Kumba Amma** v. **Kerala State Electricity Board** (2000 (1) KLT 542) passed by this Court, reassessed the compensation payable for fixing such compensation at 5% annuity. I find nothing in the decision rendered by C.R.P. NO.957 OF 2005 :: 12 :: the apex court in _**Livisha's case**_ (supra) to hold that the assessment of the compensation following the principles laid down in _**Kumba Amma's**_ case (supra) cannot be made applicable depending upon the facts and circumstances of the case. The apex court has held that compensation in relation to fruit bearing trees are concerned, the same would depend upon the facts and circumstances of each case. Of course in a case where it is shown that fixation of compensation at 5% annuity would cause prejudice or injury to any of the parties involved depending upon the facts and circumstances in the case, a different yardstick can be applied for. No such special circumstance is made out in the present case to hold that the principles laid down in _**Kumba Amma's**_ case are inapplicable to the case....” 15. In the present case, large number of yielding plants and trees were cut and removed for drawing the electricity line. The court below found that the compensation paid to the claimant was very low. The court below, however, did not adopt the rate of coffee and other items mentioned in Exts.A1 and A2, and fixed a lower amount for the agricultural produces. It cannot be said that the C.R.P. NO.957 OF 2005 :: 13 :: finding rendered by the court below on these aspects, based on the materials on record, is illegal or unsustainable. No materials are brought out to show that the value of the agricultural produces fixed by the court below is on the higher side. 16. The trees were cut in the year 1999 and even in 2012, the matter has not become final. There is no point in remanding the case to the District Court to facilitate the petitioner to adduce further evidence. If that is done, this Court will be causing great prejudice and hardship to the claimant/respondent who received the enhanced compensation deposited by the Board years back. For the aforesaid reasons, the Civil Revision Petition is dismissed. **(K.T.SANKARAN) Judge** ahz/