Padma Uppal v. State of Punjab & Ors.

329 PADMA UPPAL r:rc. _v._ STATE OF PUNJAB & ORS. _August_ 23, 1976 [A. N. RAY, C.J., M. H. BEG AND JASWANT SINGH, JJ.] _Land acquisition-Fixing_ _compensation-When_ _the_ _Sup,,me_ _Court coufd_ _interfere._ _Procedure-When_ _a Court_ _of_ _appeal can interfere in the lower court's judg-_ _ment._ In respect of a vast area of land, partly urban and partly rural, adjoining each other, acquired by the State Government the Collector classified a part of it as potential building area and part as agricultural land and fixed a slightly higher rate of compensation for the former and a lower rate for the latter. Accepting the classification, the Senior Sub-Judge tq whom the determination of compensation was referred enhanced the compensation in respect of both classes of land. In appeal, the High C<;mrt further enhanced the compensation of both classes of !Md. In further appeal to this Court, it was contended that since the whole of the la.nd in question formed one consolidation block, the entire area should have been treated as potential building area and compens,.tion fixed on the basis of the market value. DismiMi!li the appeals, HELD : In an appeal from an award granting compensation, this Court should npt interfere unless there is a wrong application of any well·settled principle or unless there is something to show not merely that on the balance of evidence it is possible to reach a different conclusien but that the judgmant cannot be supported by reMOn of 11. wrong application of a. principle or because some important point affecting valuation has bee11 overlooked or misapplied. There is a prudent condition to which the appellate power, generally speaking is subject, namely that a court of appeal interferes not when the judgment under attack is not right but only when it is shown to be wrong. [333 Fl _The Special Land Acquisition Officer,_ _Bangalore_ v. _T. A.dinarayan Setty_ [1959] Sopp. 1 S.C.R. 404. _Dattatrayaya Shankarbhat A.mbalgi_ & _Ors._ v. _The_ _Collector_ _of_ _Sho/apur_ & _A.nr._ [1971] 3 S.C.C. 43 and _The Dollar Company,_ - _Madras_ v. _Collector_ _of Madras_ [1975] 2 S.C.C. 730 referred to. In case of acquisition of several plots of land which constitute one block comprising of agricultl,lral land and potenti~l building area, the principle of belting has no application. As mch the erstwhile proprietors of the plots cannot be granted compensation for the agricultural land at the same rate at which compensation is determined in respect of potential building a.rea which is better situate and possesses far greater advantages. [332 G] _Mirza NMusherwan Khan_ & _Anr._ v. _The Collector_ _(L1Jnd_ _Acquisition) Hydera-_ bad [1975] 1 S.C.C. !38 applied. CIVIL APPEALS Nos. 2694-2695, 2697-2700 and 2703-2704/72. Appeals from the Judgment and Order dated 3-1-68 of the Punjab and Haryana High Court in Regular First Appeal Nos. 190-193, 195198/62. 233 and 234/64 and CIVIL APPEALS Nos. 2694-2695, 2697-2700 and 2703-2704/72. Appeals from the Judgment and Order dated 3-1-68 of the Punjab & Haryana High Court in R.F.A. Nos. 192-193 195-198 and 233-234/62. ' A B #### c D E F G H A **.B** ### c D E F G **H** 330 **SUPREME COURT REPORTS** [1977) 1 S.C.R. _S. T. Desai_ (In C. As. 2394-2397 of 1972), _F._ _S._ _Nariman_ (In C.As: 2398 to 2402/72, _Naunitla/ and Miss Lalita Kohli_ for the Appellants Ill C.As. 2394-2403/72 and for Respondents in C.As. 2-094-2695 2697-2700. and 2703-2704/72. . ' _0._ _P._ _Sharma_ for the Appellant in C.As. 2694-2695, 2697-2700 and 2703-2704/72 and for the Respondents in C.As. 2394-2403/72. The Judgment of the Court w~s delivered by ]ASWANT SINGH, J.-This batch of 18 appeals Nos. 2394 to 2403 . of 1972 and 2694, 2695, 2697 to 2700, 2703 and 2704 pf 1972 by certificates granted under Article 133(1) (a) of tbe Constitution which arise out of acquisition proceedings under the Land Acquisition Act, 1894 (Act No. 1 of 1894) (hereinafter referred to as 'the Act') and are directed against the common judgment dated January 3, 1969 of tbe High Court of Punjab and Ha.ryana shall be disposed of by this judgment. · While the first group of ten appeals Nos. 2394 to 2403 of 1972 are by the erstwhile proprietors of land claiming enhancement of ·the compensation awarded to them by the High Court, the rest of !he eight appeals are by tbe State of Punjab challenging the quantum of compensation as enhanced by the High Court. It appears that a vast area of land measuring 832 kanals and 2 marlas (i.e. 416050 sq. yds) situate in Amritsar (Urban) and village Tungbala, Amritsar was acquired by the Government of Punjab for a publis purpose viz. the expansion of the existing Medical College and allied institutions in the city of Amritsar. Whereas the notification under section 4 of the Act in respect of the aforesaid area was issued on March 18, 1959, the notification under section 6 of the Act was issued on July 4, 1959. The Collector, Amritsar, classified the aforesaid area for fixation of compensation into two categories viz. the potential building area and the agricultural land. The Collector categorfaed 60 kanals and 18 marlas (i.e. 30450 sq. yds). which abutted on the circular Road and Majitba Road as potential building area and the remaining 771 kanals and 4 marlas as agricultural 1and aru1 by his order dated December 2; 1959 awarded Re. 1/- per sq.·yd. as compensation for the potential building "area and Re. -/6/- per sq. yd. for agricultural land. Dissatisfied with the award, the erstwhile proprietors approached the Collector roquesting him to make reference• to the Senior ·sub-Judge, :Amritsar under section 18 of the Act. The Senior Sub-Judge made a spot inspection for the purpose of appraisal of the evidence adduced before him and by his judgment and.award dated June 9, 1962 accepted the classification made by the Collector but enhanced the compensation of tbe agricultural land to Re. _11-_ per sq. yd. and of the potential building :uea to Rs. 1.50 per sq. yd. On appeal, the ·High Court after taking into consideration some transactions of sales in .tbe locality proximate in point of time to the date of the publication of the notification under section 4(1) of the Aot, the opinion of the valuers regarding the trend of the prices of land in the locality and tbe situation and potentialities of the land in question by its aforesaid judgment and decree dated January 3, 196& aW!l!ded Rs. 3/- per sq. yd. for tbe agricultural land and Rs. 4.50 per sq. yd. for # ti ###### • ### _!_ ##, PADMA UPPAL _v._ PUNJAB _(Jaswant Singh,_ _J.)_ 331 the potential building area. It is agaiill5t this judgment and decree A that the present appeals, as already stated have been preferred. At the htaring of these appeals, counsel for the appellants in the fin.t set of ten appeals have, in the first instance, u!ged that. as the plots of land in question formed one consoh?ated .bl?cK, the enttre area thereof should have been treated as potential bu1ldi:ig area and compensation awarded accordingly. It has been ne'<t contended by counsel for the appellants particularly in ~ppeals No~. 24?2 an? 2Ll03 of 1972 that the High Court has erred m overlookmg tt1e evidential value furnished by-(i) the award made by the Colkcror, Amritsar fixing Rs. 4/12/- per sq. yd. as compensation for the land measuring 28.75 acres in Amritsar (Urban) and 32.04 acres in village Tungbala, Urban which was sought to be acquired in February, 194 7, and notification under section 4(1) of the Act in respect whereof was published on February 22, 1947, (ii) the price paid by the appellants in purchasing some of the plots in question in October, 19,1-6 and January, 1047 and (iii) the transactions of sale of the land in the locality made in 1958-59 which conclusively established that the market value of the land in question was much higher than that awarded by the High Court. On the other hand, it has been contended by counsel for the State of Punjab and Collector, Amritsar that the material on record did not warrant the enhencement by the High Court of the compensation awarded to the erstwhile properties by the Senior Subordinate Judge, Amritsar; that the High Court could not justifiably ignore the fact that for 25 kanals and 10 marlas of land which Jay in close proximity to the plots of land in question and was acquired by the State in May, 1956, the market value was assessed at Rs. 25/- per marla _i.e.,_ Re. 1/- per sq. yd.; and that in any event, the, High Court acted ille~ally in awarding comp~nsation in excess of Rs. 4/- per sq. yd. claimed by the respondents m the second set of six appeals Nos. 2694, 2695 and 2697 to 2700 of 1972. Before dealing with the rival contentions adv:mc<:d by counsel for the. parties, it will be appropriate to refer to the law -bearing on the matter. The measure of compensation to be awarded to the owners of immovable property acquired by the State is enshrined in section 23(1) of the Act which is designed to award just and fair compensation for the acquisition. According to this provision, compensation has to be awarded on the basis of the market value prevalent on the date of the publication of the notification under section 4(1) of the Act. The connotation of the expression 'market value' bias been explained time and again by this Court. In _Khaja Mizuddin_ v. _State_ _of_ _A ndhra Pradesh('),_ it was laid down as follows : "Under section 2? (1) of the Act, in determining the amount of compensat10n, the court shall take into consideration the n:arke~ value of the_ land at the date of publication of the nottficat1on under sect10n 4( 1) thereof. Decided cases have laid down that the said market rate must be determined 1) C.A. 176 of 1962 decided on April _10,_ 1963. B. ##### c D E F G H A B #### c D E F G J32 SUPREME COURT REPORTS [19'f7) 1 S.C.R. by reference to the price which a willing vendor might reasonably expect to obtain from a willing purchaser. For 36certaining the market rate the court can rely upon such transactions which would afford a guide to fix the price. Price paid for a land acquired within a reasonable time from the date of acquisition of the land in question would ce.rtainly be the best piece of evidence. Price paid for a land possessing advantages similar to those of the land acquired in or about the time of notification will also supply the data for assessment of compensation." Bearing in mind the above principles, let us now deal with the contentions raised by counsel for the erstwhile owners of the plots of land in question. The contention of counsel for the appenants that compensation should have been awarded treating the entire laI'ld as potential building area is devoid of substance. It is true that the land in question constitutes one block but it cannot be overlooked that the entire area thereof is not similarly situate and doei not possess the same or similar advantages and benefits. The Senior Subordinate Judge (who had the advantage of spot inspection) as also the High Court have after careful analysis of the evid@nce observed that it is only the portion of the area which adjoins the Majitha Road opposite to which is situate the Sacred Heart Convent which lies close to Gopalnagar and a portion of the land on the Circular Road opposite to which there are buildings that can reasonably be regarded as a potential building area and the remaining area which extends far beyond the alignment of the Sacred Heart Convent and does not possess the same advantages cannot be treated at par with the former category of the land. It has also been concurrently found by the Courts below that apart frnm the fact that the land which falls within the second category is situate in the rear away from habitation, it suffers from two other drawbacks in that it is not accessible from either side of the two roads and there are no roads therein. The erstwhile proprietors cannot, therefore, be justifiably granted compensation for the agricultural land at the rate determined in respect of the potential building area which possesses far greater advantages. We are fortified in this view by a decision of this Court in _Mirza Nausherwan_ _Khan_ _&_ _Anr._ v. _The Collector_ _(Land_ _Acquisition)_ _Hydera1.11!td(')_ where ##### Krishna Iyer, J who spoke for the Bench said : "It is true that the Court has adopted a higher value for a strip 50 feet wide adjoining the road, based on the principle of belting. There is no doubt that when we deal with value of an extensive plot of land in a city the strip that adioins an important road will have a higher value than what i~ in the rear, for obvious masons of potential user or commercial exploitation." Wa cannot also accede to the contention of :;:ounsel for the appellants in appeals Nos. 2402 and 2403 of 1972 that they should have at least been granted compensation for the potential buildings area at Rs. 4/12/- the rate fixed by the Collector, Amritsar for 28.75 acres in Amritsar (Urban) and 32.04 acres in village Tungbala, Amritsar (1) [1975] l s.c.c. 238. PADMA UPPAL _v._ PUNJAB _(Jaswant Singh,_ J.) 333 :sought to be acquired by the State in February, 1947 as the pro~e~d­ ings for acoiuisition of the said area were d~opped and the proxnn.1ty in point of time to the notification under section 4 ( 1) of the Act which is a material factor is lacking. A-, .~· The contention advanced on behalf of the appellants in the aforesaid two appeals that the compensation awarded to them could not be fixed below the price paid by them for some of the plots in question B in 1943, 1946 and 1947 has also no force. It cannot be ignored that Amritsar having come near the border as a result of the partition of the sub-continent, the prices of land situate therein fell considerably soon after the partition and kept on maintaining a low level for more than a decade. The contention of counsel for the appellants in the aforesaid two C appeals that they should have at least been awarded compensation for the potential building area at the rate prevalent in Gopalnagar in. ~~5859 cannot also be acceded to. A glance at the chart of the acqms1tions which appears at page 85 of the Paper Book shows that the sales were of very small plots of land. In seven transactions out of eight to which our attention has been invited, the land acquired was below 200 sq. yds. and in the eighth transaction, it was 250 sq. yds. It is also well D settted that iR determining compensation the value fetched for small plots of !and cannot be apylied to the lands covering a very large extent and that the large area of land cannot possibly fetch a price at the same rate at which small plots are sold. (See- _Collector_ _of_ _Lakhimpur_ v. _Bhuban Chandra Dutta(')._ All the three contentions advanced on ~half of the claimants of compensation, therefore, fail. Let us now deal with the second set of the aforesaid t:ight appeals preferred by the State of Punjab. While doing so, it would be well to recall that it is well established that in an appeal from an award granting compensation, this Court should not interfere unle~s there is a wrong application of any well settled principle or unless there js something to show not merely that on the balance of evidence it is possible to reach a different conclusion but that the judgment cannot F be supported by reason of a wrong application of a principle or becau5e some imp0rtant point affecting valuation has been overlooked or misapplied. Moreover, there is a prudent condition to which the appellate power, generally speaking, is subject. A court of_ appeal inter!eres not when the judgment under attack is not right but only when it 1s shown to be wrong. (See _The Special Land Acquisition Officer,_ _Bangalore_ v. _T._ _Adinarayan Setty(_ _[2 ]_ _)_ _Dattatrayaya_ _Shankarbhat_ G _Ambalgi_ & _Ors._ v. _The Collector_ _of_ _Sholapur_ & _Anr.(_ _[3 ]_ _)_ and _The_ _Dollar Company, Madras_ v. _Collector_ _of_ _Madras(')._ _The first contention advanced on behalf of the State that the erstw_hile owners of the land in question could not be given compensatioR higher than !hat asses~~ for the acquisition made by the State for the construction of Hygiene and Vaccine Institute is devoid of force. ·(l) A.l.R. 1971 S.C. 2015 (2) [1959] Supp. l S.C.R. 404. (3) 119711 3 s.c.c. 43. (4) [1975] 2 s.c.c. 730. H **A** **B** #### **c** **D** 334 8UPREME COURT REPORTS [1977] 1 S.C.R. Whereas the notification under section 4(1) of the Act with regard to· th.at acquisition was published on May 17, 1956, the notification.. under the said provision or the Act in respect of the instant acquisition was published on March 18, 1959 when the market value of the land in the locality had risen very high. The ratio of compensation assessed for the former acquisition cannot, therefore, serve as a safe guide for determination of compensation for the acquisition in question. Similarly, the consideration paid by Smt. Balwant Kaur to Shri Girdhari Lal in March, 1957 for the purchase of land cannot also serve as a safe guide as this transaction also took place in March, 1957 _i.e.,_ nearly two yeai;s before the publication of the aforesaid notification in respect of the present acquisition. The High Court was, in our opinion, perfectly justified on the basis of the material before it in fixing compensation at Rs. 4.50 per sq. yd. for the potential building area and Rs. 3.00 for the agricultural area in respect of the plots of land involved in appeals Nos. 2402 and 2403 o[ 1972. The High Court, however, was wrong in overlooking an important point affecting compensation payable to the erstwhile owners of the potentia1 building area involved in appeals Nos. 2694, 2695 and 2697 to 2700 of 1972. The said claimants having claimed compensation only at the rate of Rs. 4.00 per sq. yd. in the first appeals filed by them in the High Court, they could not have been awarded compensation exceeding that rate. Tlius the said appeals filed by the State cannot but be allowed to the extent to which the compensntion awarded to the claimants in respect of the· potential building area acquired exceeds Rs. 4.00 per sq. yd. In the result, appeals Nos. 2394 to 2403 of 1972 and 2703 and E 2704 of 1972 fail and are hereby dismissed with costs (limited to ooe hearin~ fee) and appeals Nos. 2694, 2695 and 2697 to 2700 of 1972 are allowed with costs (limited to one hearing fee) to the extent indicated above. **P.B.R.** _Appeals partly_ allowed~ _A..._ .1