Power Grid Corporation of India Ltd. v. Kurián Chacko & Ors. (CRP Nos. 291 of 2009; 491 of 2008; 510 of 2008)

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE K.T.SANKARAN FRIDAY, THE 17TH DAY OF FEBRUARY 2012/28TH MAGHA 1933 ## **CRP.No. 291 of 2009** OP(ELE.) NO.61/2003 ON THE FILE OF THE ADDITIONAL DISTRICT COURT, PATHANAMTHITTA REVISION PETITIONER: 1ST RESPONDENT: ---------------------- POWER GRID CORPORATION OF INDIA LTD., LOCAL OFFICE, NANGIARKULANGARA, KAYAMKULAM, REP. BY ITS MANAGER. ## BY ADV. SRI.MILLU DANDAPANI ## RESPONDENT: PETITIONER: -------------- KURIAN CHACKO, AGED 46 YEARS, S/O.KURIAN, CHIRACKAL THOTTUNGAL HOUSE, NEDUMPRAM VILLAGE, PADINJAREKARA MURI, THIRUVALLA TALUK, REPRESENTED BY HIS POWER OF ATTORNEY HOLDER LISSY CHACKO, AGED 39 YEARS, W/O.KURIAN CHACKO, -DO- -DO- ERATHU VILLAGE. THIS CIVIL REVISION PETITION HAVING BEEN FINALLY HEARD ON 17-02-2012, ALONG WITH CRP. NOS.491 AND 510 OF 2008, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: ## **I.A.NO.1982/2009 IN C.R.P.NO.291/2009** ## DISMISSED 17/2/2012 SD/- **K.T.SANKARAN, JUDGE** //TRUE COPY// AHZ/ ## **K.T.SANKARAN, J.** **-----------------------------------------------------C.R.P. NO. 291 OF 2009 , and C.R.P.NOS. 491 & 510 OF 2008 -----------------------------------------------------Dated this the 17[th] day of February, 2012** ## **O R D E R** These three Revisions arise out of the common order in O.P. (Ele.) Nos.61 of 2003, 62 of 2003 and 31 of 2005 respectively on the file of the Court of the Additional District Judge, Pathanamthitta. 2. For drawing 220 KV electric transmission line from Kayamkulam to Pallam, the properties belonging to the petitioners were crossed and trees were cut. The Power Grid Corporation of India Limited (hereinafter referred to as 'the Corporation') paid compensation to the owners of the land for the tree cutting. No compensation was granted on account of diminution of land value. Dissatisfied with the amount awarded, the owners of the lands filed the aforesaid three Original Petitions before the Court below. The Court below granted an enhanced compensation of `1,40,065/- to the claimant in O.P.(Ele.) No.61 of 2003. Challenging that order, the ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 2 :: Corporation filed C.R.P.No.291 of 2009. The claimant has not challenged the order passed by the court below. 3. In O.P.(Ele.)No.62 of 2003, the court below granted an enhanced compensation of `23.210.25. The claimant has filed C.R.P.No.491 of 2008 claiming more amount for diminution of land value. The Corporation has not challenged the order passed by the court below. 4. In O.P.(Ele.) No.31 of 2005, a sum of `22,040/- was granted by the Court below as enhanced compensation over and above the amount awarded by the Corporation. Stating that the amount awarded is low, the claimant has filed C.R.P.No.510 of 2008. The Corporation has not filed any revision challenging the order in O.P.(Ele.) No.31 of 2005. 5. In the case of O.P.(Ele.) No.61 of 2003, five yielding coconut trees were cut from the property of the claimant. The Corporation granted a sum of `24,248/- as compensation for the ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 3 :: trees cut. 10% annuity factor was taken into account by the Corporation. The court below granted an enhanced compensation of `17,065/- in addition to the amount granted by the Corporation. The court below relied on the decision in **Kumba Amma** v. **Kerala State Electricity Board** (2000 (1) KLT 542) and took 5% as the annuity factor. As per the Commissioner's report, the line occupies 19.768 cents of land. A clearance area of 24.24 cents has to be provided by the claimant. Thus the court below held that 44 cents of land was affected by the drawal of the line. The court below also held that two cents of land was used for erection of the tower. The land value was fixed by the court below at `15,000/-. The court below held that the diminution of land value in respect of the land covered by the tower would be 80% for two cents of land. Accordingly, a sum of `24,000/was granted as diminution of land value for the area occupied by the tower. For the extent of 44 cents affected by the drawal of the line, diminution of land value was assessed at 15% of the land value and, accordingly, a compensation of `99,000/- was granted. Thus, the court below granted `1,40,065/- as the total enhanced compensation. ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 4 :: 6. In O.P.(Ele.) No.62 of 2003, the claimant owns an extent of ten cents of land. One coconut tree was cut for the drawal of the line. The Corporation granted a sum of `2,319/- as compensation for tree cutting. The court below granted an additional compensation of `1,860/- for the trees cut. As regards diminution of land value, the Court below held that an extent of 9.489 cents of land was affected by the drawal of the line and taking 15% of the land value as diminution factor and fixing the land value at `15,000/- per cent, the court below granted an enhanced compensation of `21,350.25. Thus a total amount of `23,210.25 was granted by the court below as enhanced compensation. 7. In O.P.(Ele.) No.31 of 2005, four coconut trees belonging to the claimant were cut from an extent of ten cents of land. The Corporation awarded a sum of `11,868/- as compensation for the trees cut. The court below granted an enhanced compensation of `9,809/- for the trees cut. As compensation for diminution of land value, the court below awarded a sum of `12,231/-, taking the ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 5 :: affected area as 5.36 cents and fixing the compensation at 15% of the land value and taking the land value at `15,000/- per cent. 8. Thus, from the facts stated above, it is clear that as against the common judgment in the three cases, the Corporation has filed Revision only against the order in O.P.(Ele.) No.61 of 2003. The respective claimants have filed Revisions only against O.P.(Ele.) Nos.62 of 2003 and 31 of 2005. ## 9. The court below relied on the judgment in **Kumba Amma** v. **Kerala State Electricity Board** (2000 (1) KLT 542). It is submitted by the learned counsel for the Corporation that in view of the Judgment of the Supreme Court in **K.S.E.B** . v. **Livisha** ((2007) 6 SCC 792 = 2007(3) KLT 1 (SC)), the compensation has to be fixed for tree cutting taking into account the relevant aspects and not by taking 5% on annuity factor as held in Kumba Amma's case. 10. 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 ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 6 :: 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: _“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_ ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 7 :: _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 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.”_ ## 11. In **Kumba Amma** v. **Kerala State Electricity Board** (2000 (1) KLT 542), the Larger Bench held thus: ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 8 :: _“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 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_ ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 9 :: _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 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.”_ 12. 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. ## 13. 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: ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 10 :: _“10. Now, we will consider what is meant by ‘real rate of interest’ and its relevance in computation of 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. 14. In the Monetary Policy Statement 2010-11 issued by the Reserve Bank of India, it is stated in paragraph 32 thus: _“32. Notwithstanding the current inflation scenario, it is important to recognise that in the last decade, the average inflation rate, measured both in_ ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 11 :: _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.”_ 15. 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 the apex court in_ _**Livisha's case** (supra) to hold that the assessment of the compensation following the principles_ ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 12 :: _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....”_ 16. For the aforesaid reasons, I do not find any ground to interfere with the enhancement of compensation granted by the court below for tree cutting in the aforesaid three cases. 17. As regards diminution of land value, the court below fixed the land value at `15,000/- per cent. The claimants relied on Ext.A10 assignment deed dated 25.3.2000, by which an extent of ten cents of land was sold for a consideration of `4,20,000/-, the centage ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 13 :: value being `42,000/-. The court below held that Ext.A10 land and the land in question are not similarly situated. However, the court below held that the lands belonging to the claimants have road frontage and that they have commercial potentiality. It was also held that several important institutions are situated near the property. In spite of all these factors, the court below fixed a very low sum of `15,000/- as land value. I do not find that the court below committed any error in fixing the land value at `15,000/- per cent. 18. In all the three cases, the court below has taken 15% of the land value as the diminution of land value. In O.P.(Ele.) No.61 of 2003, a larger extent of land belongs to the claimant. But in the case of O.P.(Ele.) No.62 of 2003, out of the ten cents of land belonging to the claimant, 9.489 cents was affected by the drawal of the line. In O.P.(Ele.) No.31 of 2005, out of the ten cents of land belonging to the claimant, an extent of 5.36 cents of land was affected by the drawal of the line. The same yardstick cannot be applied in all the cases while fixing the compensation for diminution of land value. In the two cases of ten cents mentioned above, a major portion of the ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 14 :: land is covered by the electricity line. In those cases, certainly, the diminution of land value will be higher than the diminution which may occur to an extensive land where line is drawn. Therefore, I am of the view that the court below was not justified in fixing the diminution factor at 15% of the land value in O.P.(Ele.) Nos.62 of 2003 and 31 of 2005. Taking into account the total extent of land occupied by those claims and the extent of land affected by the drawal of the line, I am of the view that diminution can be granted at 25% of the land value in those two cases. Thus, the compensation to be paid to the claimant in O.P.(Ele.) No.62 of 2003 for diminution of land value would be 9.489 x 15000 x 25/100 = `35,583.75. The compensation for diminution of land value to be granted to the claimant in O.P. (Ele.) No.31 of 2005 would be 5.36 x 15000 x 25/100 = `20,100/-. To that extent, the awards in O.P.(Ele.) Nos.62 of 2003 and 31 of 2005 require to be modified. 19. The learned counsel for the petitioners in O.P.(Ele.) Nos.62 of 2003 and 31 of 2005 submitted that interest was awarded by the court below at a low rate of 6%. But, that too was granted ## **C.R.P. NO. 291 OF 2009 and C.R.P.NOS.491 & 510 OF 2008** :: 15 :: from the date of the Original Petition. There is no case that the Original Petition was filed belatedly. As held by the Division Bench, interest is payable from the date of cutting of trees. To that extent also, the awards in O.P.(Ele.) Nos.62 of 2003 and 31 of 2005 are modified. For the aforesaid reasons, C.R.P.No.291 of 2009 filed by the Power Grid Corporation of India Limited is dismissed and C.R.P.Nos.491 of 2008 and 510 of 2008 filed by the claimants are allowed in part to the extent indicated above. **(K.T.SANKARAN) Judge** ahz/