Roy Joseph & Ramesh Joseph v. State of Kerala; Cochin Port Trust; National Highways Authority of India, and others (LA.App. Nos. 1208/2009; 1229/2009; 737/2013; 50/2018)

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE C.K.ABDUL REHIM** ## **&** **THE HONOURABLE MRS. JUSTICE SHIRCY V.** **WEDNESDAY, THE 07TH DAY OF MARCH 2018 / 16TH PHALGUNA, 1939** **LA.App..No.1208 OF 2009** **AGAINST THE JUDGMENT AND DECREE IN LAR 173/2007 DATED 21-02-1909 OF III ADDITIONAL SUB COURT, ERNAKULAM** ## **APPELLANTS/CLAIMANTS:** - **1 ROY JOSEPH, S/L. K.K. JOSEPH MANAGING DIRECTOR, M/S.KALLARACKAL RESORT PVT.LTD., VADUTHALA, COCHIN - 682 025.** - **2 RAMESH JOSEPH, EXECUTIVE DIRECTOR, M/S. KALLARACKAL RESORT PVT. LTD., VADUTHALA, COCHIN - 682 025.** **BY ADV. SRI.C.M.ANDREWS** ## **RESPONDENTS/RESPONDENTS:** - **1 STATE OF KERALA REPRESENTED BY SPECIAL TAHSILDAR (LA), ICTT, VALLARPADAM.** - **2 COCHIN PORT TRUST, ERNAKULAM.** **3 ADDL. R3. THE NATIONAL HIGHWAYS AUTHORITY OF INDIA, PROJECT IMPLEMENTATION UNIT-COCHIN, REPRESENTED BY THE PROJECT DIRECTOR, 'THARAKANS', HOUSE NO. IV/550, FIRST FLOOR, RAGAGIRI ROAD, KALAMASSERY-683104, ERNAKULAM DISTRICT.** **(ADDITIONAL R3 IS IMPLEADED AS PER ORDER DATED 04/11/2015 IN IA 801/2015)** **R1 & R2 BY ADVS. SRI.K.ANAND SR. SMT.LATHA KRISHNAN** **R3 BY ADV. SRI.THOMAS ANTONY** **THIS LAND ACQUISITION APPEAL HAVING BEEN FINALLY HEARD ON 07.03.2018, ALONG WITH LA.App..1229/2009, LA.App..737/2013, LA.App..50/2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **LAA No.1208/2009 and connected cases -2-** **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE C.K.ABDUL REHIM** **&** **THE HONOURABLE MRS. JUSTICE SHIRCY V.** **WEDNESDAY, THE 07TH DAY OF MARCH 2018 / 16TH PHALGUNA, 1939** **LA.App..No.1229 OF 2009** **AGAINST THE JUDGMENT AND DECREE IN LAR 172/2007 DATED 21-02-1909 OF III ADDITIONAL SUB COURT, ERNAKULAM** ## **APPELLANTS/CLAIMANTS:** - **1 ROY JOSEPH S/O.K.K.JOSEPH, MANAGING DIRECTOR, M/S.KALLARACKAL RESORT PVT.LTD., VADUTHALA, COCHIN - 682 025.** - **2 RAMESH JOSEPH, EXECUTIVE DIRECTOR, M/S.KALLARACKAL RESORT PVT.LTD., VADUTHALA, COCHIN - 682 025.** **BY ADV. SRI.C.M.ANDREWS** ## **RESPONDENTS/RESPONDENTS:** - **1 STATE OF KERALA REPRESENTED BY SPECIAL TAHSILDAR (LA), ICTT, VALLARPADAM.** - **2 COCHIN PORT TRUST, ERNAKULAM.** - **3 THE NATIONAL HIGHWAYS AUTHORITY OF INDIA, PROJECT IMPLEMENTATION UNIT-COCHIN, REPRESENTED BY THE PROJECT DIRECTOR, 'THARAKANS', HOUSE NO.IV/550, FIRST FLOOR, RAJAGIRI ROAD, KALAMASSERY-683104, ERNAKULAM DISTRICT.** - **(ADDL. R3 IS IMPLEADED AS PER ORDER DATED 04.11.2015 IN IA.802/2015.)** **R1 & R2 BY ADVS. SRI.K.ANAND SR.** **SMT.LATHA KRISHNAN** **R3 BY ADV. SRI.THOMAS ANTONY** **THIS LAND ACQUISITION APPEAL HAVING BEEN FINALLY HEARD ON 07.03.2018, ALONG WITH LA.App..1208/2009, LA.App..737/2013, LA.App..50/2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **LAA No.1208/2009 and connected cases** **-3-** **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE C.K.ABDUL REHIM** **&** **THE HONOURABLE MRS. JUSTICE SHIRCY V.** **WEDNESDAY, THE 07TH DAY OF MARCH 2018 / 16TH PHALGUNA, 1939** **LA.App..No.737 OF 2013** **AGAINST THE JUDGMENT AND DECREE DATED 03-07-2010 IN LAR 426/2008 OF III ADDITIONAL SUB COURT, ERNAKULAM** **APPELLANT/CLAIMANT No.1:** **ROY JOSEPH, MANAGING DIRECTOR, M/S. KALLARACKAL RESORTS PVT. LTD., KOTHAD, VADUTHALA, COCHIN-682023.** ## **BY ADV. SRI.C.M.ANDREWS** ## **RESPONDENTS/RESPONDENT No.1, ADDL.RESPONDENT No.2/CLAIMANTS 2 & 3:** - **1 STATE OF KERALA, REPRESENTED BY SPECIAL TAHSILDAR (L.A.), ICTT, VALLARPADAM, ELOOR, ERNAKULAM DISTRICT, PIN-683502.** - **2 THE CHAIRMAN, COCHIN PORT TRUST, WILLINGDON ISLAND, COCHIN-682003.** - **3 THE CHIEF MANAGER, KERALA FINANCIAL CORPORATION, KOTTAYAM BRANCH, KOTTAYAM, PIN-686001.** - **4 THE TAHSILDAR, KANAYANNUR, ERNAKULAM DISTRICT, PIN-682016.** - **5 ADDL. R5. THE NATIONAL HIGHWAYS AUTHORITY OF INDIA, PROJECT IMPLEMENTATION UNIT-COCHIN, REPRESENTED BY THE PROJECT DIRECTOR, 'THARAKANS', HOUSE NO. IV/550, FIRST FLOOR, RAJAGIRI ROAD, KALAMASSERY683104, ERNAKULAM DISTRICT.** - **(ADDITIONAL R5 IS IMPLEADED AS PER ORDER DATED 04/11/2015 IN IA 239/2014)** **LAA No.1208/2009 and connected cases** **-4-** **R1 & R4 BY GOVERNMENT PLEADER SMT. RASHMI K.M. R2 BY ADV. SMT.LATHA KRISHNAN** **R3 BY SRI.BASANT BALAJI, SC, KERALA FINANCIAL CORPORATION** **ADDL. R5 BY ADV. SRI.THOMAS ANTONY** **THIS LAND ACQUISITION APPEAL HAVING BEEN FINALLY HEARD ON 07.03.2018, ALONG WITH LA.App..1208/2009, LA.App..1229/2009, LA.App..50/2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **LAA No.1208/2009 and connected cases** **-5-** **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE C.K.ABDUL REHIM** ## **&** **THE HONOURABLE MRS. JUSTICE SHIRCY V.** **WEDNESDAY, THE 07TH DAY OF MARCH 2018 / 16TH PHALGUNA, 1939** **LA.App..No.50 OF 2018** **AGAINST THE JUDGMENT AND DECREE IN LAR 426/2008 DATED 03-07-2010 OF III ADDITIONAL SUB COURT, ERNAKULAM** ## **APPELLANT/1ST RESPONDENT & 3RD CLAIMANT IN LAR:** |**1**|**STATE OF KERALA**| |---|---| ||**REP. BY THE SPECIAL TAHSILDAR (LA), ICTT,**| ||**VALLARPADAM, ELOOR, ERNAKULAM DISTRICT.**| |**2**|**THE TAHSILDAR**| ||**KANAYANNUR, ERNAKULAM DISTRICT.**| ||**BY SPL.GOVERNMENT PLEADER SMT. LATHA THANKAPPAN**| |**DENT**|**S/CLAIMANTS 1 & 2 AND 2ND ADDL. RESPONDENT IN LAR**<br>**:**| |**1**|**ROY JOSEPH**| ||**MANAGING DIRECTOR, M/S. KALLARACKAL RESORTS PVT.**| ||**LTD., KOTHAD, VADUTHALA, COCHIN-682023.**| |**2**|**THE CHAIRMAN**| ||**COCHIN PORT TRUST, WILLINGDON ISLAND,**| ||**COCHIN-682003.**| |**3**|**THE CHIEF MANAGER**| ||**KERALA FINANCIAL CORPORATION,**| ||**KOTTAYAM BRANCH, KOTTAYAM-686001.**| ## **RESPONDENTS/CLAIMANTS 1 & 2 AND 2ND ADDL. RESPONDENT IN LAR:** **THIS LAND ACQUISITION APPEAL HAVING BEEN FINALLY HEARD ON 07.03.2018, ALONG WITH LA.App..1208/2009, LA.App..1229/2009, LA.App..737/2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **LAA No.1208/2009 and connected cases** **-6-** ## **C. K. ABDUL REHIM & SHIRCY V.,JJ. ============================== L.A.A.Nos. 1208 of 2009, 1229 of 2009, 737 of 2013 & C.M.Appl. No.68 of 2018 in/and L.A.A No. 50 of 2018** ## **==============================** ## **Dated this the 7[th] day of March, 2018 JUDGMENT** ## **C.K. Abdul Rehim J.** Since all the above appeals arise from judgments of the reference court pertaining to the very same acquisition made for one and the same purpose, with respect to properties belonging to the very same claimants, these cases are considered together and disposed of through this common judgment. 2. L.A.A. 1208/2009, 1229/2009 and 737/2013 are filed by the claimant against the judgments in L.A.R. Nos. 173/2007, 172/2007 and 426/2008, respectively. L.A.A. No.50/2018 was filed by the State against the judgment in L.A.R.No.426/2018, along with C.M. Application No. 68/2018 seeking condonation of an inordinate delay of 2648 days occurred in filing the said appeal. 3. The acquisition was for, “construction of four lane connectivity road from Vallarpadom to Kalamassery NH 47”, for **LAA No.1208/2009 and connected cases** **-7-** the “International Container Transhipment Terminal” established at Vallarpadom. An extent of 1.89 Ares of property comprised in Survey No. 513/4-8 of Kadamakudi Village and an extent of 1.47 Ares comprised in Survey No.513/5-9 of Kadamakudi Village belonging to the appellant/claimant were acquired as per Section 4(1) Notification published on 27.9.2005. Possession of the properties were taken over by the Land Acquisition Officer (LAO) on 13.4.2007. The LAO passed Award Nos.4/2007, and 5/2007, dated 9.4.2007 with respect to the different extent of land as mentioned above. Dissatisfied with the compensation awarded, the claimant sought reference; and LAR Nos.172/2007 and 173/2007 arose from those Awards. 4. Another extent of 40.46 Ares comprised in Survey No.513/3 of Kadamakudi Village belonging to the same claimant was acquired as per section 4(1) Notification published on 26.10.2005. Possession of the said property was taken over on 17.2.2008. The LAO passed Award No. 44/2008 on 18.4.2008. Dissatisfied with the compensation, the claimant sought reference and LAR 426/2008 was registered in that respect. 5. In L.A.R. Nos.172/2007 and 173/2007, the LAO awarded compensation by fixing the land value at Rs.74,326/per Are. The Reference Court had enhanced the land value to **LAA No.1208/2009 and connected cases -8-** Rs.1,00,791/- per Are. In LAR No.426/2008 also, the Reference Court had refixed the land value at the same rate of Rs.1,00,791/- per Are. Apart from the land value an amount of Rs.1,81,18,165/- was awarded towards value of the building acquired, along with sum of Rs.15,000/- towards value of the improvements. The appellant/claimant in L.A.A.Nos.1208/2009, 1229/2009 and 737/2013 is challenging judgments of the Reference Court, by seeking further enhancement of the compensation awarded. L.A.A.No.50/2018 is filed by the State challenging judgment in L.A.R.No.426/2008, mainly on the ground that the requisitioning authority was not impleaded in the reference case. Inter alia, there is challenge against the amount of compensation awarded, as excessive. The 3[rd] Additional Respondent impleaded in L.A.A.1208/2009, 1229/2009 and 737/2013 is the National Highway Authority of India (NHAI), Project Implementation Unit, Cochin, based on their contention that they are the requisitioning authority and is a person interested in the matter of fixation of the compensation. 6. At the outset, we may deal with a brief history of the litigation with respect to the land acquisition concerned, which may be useful for deciding certain questions involved in these appeals. The claimants were running a 'Backwater Tourism **LAA No.1208/2009 and connected cases** **-9-** Resort' under the name and style “Camyakam Heaven”, having tourism classification as a '3 Star Resort' in a property having a total extent of 1 Hectare and 59.36 Ares. Various extent of land acquired are part of the property, where the Resort had functioned. When the Award in L.A.R.No.426/2008 was passed by the LAO on 18.4.2008, the same was challenged by the claimant in a writ petition filed before this court as W.P. (C)13949/2008. Contention raised was that, the Award dated 18.4.2008 was not in accordance with the draft valuation statement prepared by the LAO, which was approved by the Government. To be more specific, claimants challenged nonawarding of any compensation towards the value of the building acquired. It was contended that the LAO had originally prepared a draft valuation statement by including value of the building also and the same has got approval from the Government. Subsequently the Award was passed deviating from the approved draft valuation statement, to the extent of not awarding the value fixed with respect to the building acquired, for the reason that the construction was illegal to the extent that it violated CRZ Notification. W.P.(C)No.13949/2008 was disposed of through judgment dated 29.10.2008. It was found that, the question regarding eligibility of the claimant for receiving **LAA No.1208/2009 and connected cases** **-10-** compensation for the structures which existed on the land acquired, shall be decided by the Reference Court under Section 18. The Reference Court was directed to conduct a full-fledged enquiry into the matter and to decide whether the petitioner/claimant can be given compensation for the structures also. This court decided to provide the claimant with an opportunity to seek remedies under section 18 of the Land Acquisition Act ('L.A.Act' for short). The LAO was directed to entertain an application for reference under section 18, if such an application is filed by the claimant within 10 days of receipt of a copy of the judgment. The LAO directed to make a reference under section 18 on receipt of such application. For determination of the question regarding correctness of the compensation payable with respect to the acquired land and also with respect to the buildings which were acquired, the claimant was allowed to adduce evidence to substantiate his contentions, that the construction of the building was made lawfully and was recognised as lawful construction by the Governmental or QuasiGovernmental authorities. Evidently, the claimants have filed a writ appeal against the judgment in W.P.(C)No.13949/2008 as W.A.No. 61/2009, which was not successful. Even though the matter was taken before the hon'ble Supreme Court at the **LAA No.1208/2009 and connected cases** **-11-** instance of the claimant, the Special Leave Petition was dismissed on 18.9.2009, with a direction to the Reference Court to expedite the matter . It is on that basis the impugned judgments were passed by the Reference Court. 7. The Additional 3[rd] respondent in L.A.A.Nos.1208/2009 and 1229/2009, who is the Additional 5[th] respondent in L.A.A.No.737/2013, raised contention that the impugned judgments of the Reference Court are liable to be set aside for the reason that the said respondent was not made party in the reference cases. In the affidavit filed by the said respondent, the 'National Highway Authority of India' (the 'NHAI', for short) in support of the impleading application, it is stated that, originally the 'Road Connectivity Project was that of the Cochin Port Trust when the land acquisition proceedings was commenced. Thereafter the Central Government had entrusted construction of the Road in question with the NHAI, as a National Highway. It is conceded in the affidavit that, in the writ petitions filed by the claimant, W.P.(C)Nos.23225/2007 and 13949/2008, the NHAI was made a party and they have filed counter affidavits in those cases. It is pointed out that, the NHAI had taken a contention in those writ petitions that the claimant had constructed the building in violation of the Coastal Zone Regulations. It is stated **LAA No.1208/2009 and connected cases** **-12-** in the affidavit that this court had disposed of the writ petitions relegating the issue to be decided by the Reference Court. But it is pointed out that, the claimant as well as the State has not made the NHAI a party in the proceedings before reference court. According to NHAI, the District Collector had informed them about the filing of LAA No.737/2013 arising from LAR No. 426/2008, through a letter dated 25.1.2014 and then only the NHAI had taken steps to get impleaded in the appeals. It is stated in the affidavit that the State of Kerala had not brought to the notice of the Reference Court that NHAI is the requisitioning authority and is to be made a party in the proceedings. It is also alleged that the State had failed in properly contesting the reference cases before the Sub Court. Under such circumstances, it is mentioned in the affidavit that NHAI need to be allowed to contest the appeal, otherwise larger public interest will be affected. Learned Standing Counsel appearing for NHAI argued that, judgment of the reference court need to be set aside and the matter need to be remanded for fresh disposal, after allowing the NHAI to contest the matter properly. 8. While considering the above said contention of the NHAI, we take note of the fact that, the authority who made the requisition to the State Government to initiate the land **LAA No.1208/2009 and connected cases** **-13-** acquisition proceedings for construction of the Connectivity Road, was Cochin Port Trust. The said requisitioning authority was a party in the proceedings all along. They were made party before the Reference Court and was represented through a lawyer in the proceedings before the Reference Court. Contention of the NHAI is that, subsequently the project was entrusted by the Central Government to the NHAI. Therefore, the primary question to be decided is as to whether the NHAI can be termed as the 'requisitioning authority'. Section 50 of the Land Acquisition Act, 1894 mandates that, when the acquisition proceedings are initiated by putting into force the provisions of the said Act, at the cost of any fund controlled or managed by a local authority or of any company, such local authority or company concerned may appear before the Collector or the court and adduce evidence for the purpose of determining the amount of compensation. It is conceded by learned Standing Counsel appearing for the NHAI that, the cost of the land acquisition was met by the Central Government (Union of India). It is submitted that the funds required for the land acquisition was deposited by the Central Government to the State Government, through the NHAI, since the project was entrusted with the NHAI. Therefore, in strict sense, it cannot be said that **LAA No.1208/2009 and connected cases -14-** the acquisition was at the cost of any fund controlled or managed by the NHAI. However, even assuming that the funds in this regard is managed by the NHAI and that the NHAI can be construed as an authority coming within the purview of Section 50 of the Act, it is to be noted that, Section 50(2) only gives liberty to such authority to appear and to adduce evidence before the Collector and the Court for the purpose of determining the amount of compensation. In the decision of the Honorable Supreme Court in **U.P Awas Evam Vikas Parishad v. Gyan Devi and others [AIR 1995 SC 724]** , it is held that, the right conferred under Section 50(2) carries with it the right to be given adequate notice by the Collector as well as by the reference Court, before whom the acquisition proceedings are pending, with respect to the date on which the matter for the determination of compensation will be taken up. It is held that, on denial of such a right conferred by virtue of Section 50(2), such authority can invoke jurisdiction of the High Court under Article 226 of the Constitution. It is further mentioned that, in the event of enhancement of the amount of compensation awarded by the reference Court, if the Government does not file and appeal, such authority can file an appeal against the award in the High Court, after obtaining leave of the Court. But in the **LAA No.1208/2009 and connected cases -15-** dissenting judgment, against the majority, per RM Sahai (J) observed that, an acquiring body is not a necessary party either before the Collector who makes the award or before the Court which hears the reference. It was observed that, any proceeding for determination of the compensation is not vitiated nor is liable to be set aside for non impleadment or non issuance of notice to the acquiring body, including the local authority or company concerned. It is further observed that, if the local authority or the company on whom notice was served or it had knowledge of the proceedings did not appear, then it shall not be entitled to claim at a later stage or in appeal that the proceedings are vitiated because of the non impleadment. A learned Judge of this Court in the decision in **Kerala State Warehousing Corporation v. State of Kerala [2009 (4) KLT 443]** observed that, there exists a difference between the Kerala Act and Central Act in this regard; and the definition of the term “person interested” contained in Section 2(2) of the Kerala Act, which though not in pari materia with Section 3(b) of the LA Act, but may even be wider. There is no provision in the Kerala Act similar to section 50 of the Central Act, which obliges notice and hearing to be offered to the requisitioning authority. It is held that, the provisions tend to indicate that, statutorily under the **LAA No.1208/2009 and connected cases** **-16-** Kerala Act, the company for which acquisition is made may not have any right expressly spelt out, to the notice and participation before the Reference Court or to appeal against the Award of the Reference Court. It was found that, the court need not inevitably set aside the Award of the Reference Court, merely on the ground of failure to hear the authority/company at whose cost the acquisition was made. 9. Taking note of the principle remaining settled through precedents, it can be found that, the authority at whose cost the acquisition is made, has got a right to appear before the Collector as well as before the Reference Court, in order to contest the matter. It can also be presumed that the Collector as well as the Reference Court are at an obligation to issue notice to such authority. In the cases at hand, all along during the proceedings, the Cochin Port Trust was a party. Admittedly, the Cochin Port Trust was the authority which made the requisition. At no point of time, the said authority or the State had brought to the notice of the reference court that, the NHAI is the authority through whom the cost of acquisition was paid to the State Government. Under such circumstances, the question to be examined is, whether there occurred any failure on the part of the Reference Court in issuing notice to the NHAI. As already **LAA No.1208/2009 and connected cases -17-** observed, Section 50(2) of the Act only enables the authority at whose cost the acquisition is made, to appear and adduce evidence before the Collector or before the Reference Court, in the proceedings for determination of the compensation. It is to be examined as to whether the NHAI had utilised that right by appearing before the Reference Court for contesting the issue relating to the determination of compensation. 10. While considering the above said aspect, it is highly pertinent to note that, the NHAI was a party before this court in the writ petition filed as W.P(C)No.13949/2008. It is evident from the judgment in that writ petition that, the NHAI was represented through its Standing Counsel, in the said writ petition. It is also to be noticed that, in the said judgment the NHAI had informed the District Collector that on the basis of the stand taken by the CRZ Authority, a fresh detailed valuation will have to be taken. Under such circumstances, the NHAI cannot be permitted to contest that they were not aware of the judgment passed by this court in the writ petition directing the LAO to make reference in the matter for determining the question of compensation payable to the claimants. It is to be noted that, despite the fact that the NHAI had approached the District Collector disputing eligibility of the claimant for getting **LAA No.1208/2009 and connected cases** **-18-** compensation for the value of the building, and despite the fact that they were a party in the writ petition filed before this court and were having knowledge about the reference permitted, the NHAI had failed to approach the Reference Court for getting themselves impleaded, by substituting the 'Cochin Port Trust', who was made party therein. Therefore, it can be held that, there was failure on the part of the NHAI in exercising the right conferred upon them by virtue of Section 50(2) of the Land Acquisition Act. Learned Standing Counsel for the NHAI contended that, even the knowledge or awareness of the authority with respect to the proceedings was not sufficient for ensuring compliance of Section 50; and it is mandatory for the reference court to issue notice to the authority at whose cost the acquisition is made. In support of such a contention, the learned Standing Counsel had placed reliance on a decision of the honorable Supreme Court in **Agra Development Authority v. Special Land Acquisition Officer and Others [2001 (2) SCC** **646]** . It is a case where an Award of the Collector was challenged by the requisitioning authority in a writ petition filed before the High Court under Article 226. On the facts, it was admitted by the NHAI that, they were aware of the proceedings. But it was contended that, no notice was issued to them by the **LAA No.1208/2009 and connected cases** **-19-** Collector and that they were not given opportunity to adduce evidence for the purpose of determining the amount of compensation. The High Court dismissed the writ petition, against which the authority had taken up the matter before the apex court. It was held by the honourable Supreme Court that, the authority was aware of the proceedings and had held a meeting with the Collector is not sufficient and what is required under Section 50 is that the authority is to be given an opportunity to appear and adduce evidence for the purpose of determining the amount of compensation. Since that was not been done, the matter was sent back to the Land Acquisition Officer for refixing the compensation, after giving notice to the authority. But on the facts of the case at hand, as already observed, the NHAI had participated in the proceedings before the District Collector and submitted their objections in awarding compensation with respect to the value of the building. Subsequently, they contested the writ petition before this court. They were fully aware about the permission granted by this court to the claimants to seek reference for getting enhanced compensation. Despite such knowledge, the NHAI had not taken steps to appear before the Reference Court, by substitution of 'Cochin Port Trust', who was contesting the matter before the **LAA No.1208/2009 and connected cases** **-20-** Reference Court in their capacity as the requisitioning authority. Further it is to be noted that the NHAI had not chosen to file any appeal against the impugned judgments of the Reference Court by seeking leave of this appellate court. On the other hand, they have chosen only to get impleaded as an Additional Respondent in these appeals. Under such circumstances, we do not think it necessary to set aside the impugned judgments of the Reference Court by holding that there occurred an illegality on the part of the Reference Court in not substituting the NHAI at the place of the Cochin Port Trust, as the requisitioning authority. However, we are inclined to permit the NHAI to contest the appeals on merits with respect to the determination of the quantum of compensation payable to the claimants. The NHAI had not attempted to adduce any documentary evidence; nor had sought for acceptance of any additional evidence in the matter of disputing the compensation re-fixed. 11. Based on the above observations and findings, we may now proceed to consider the appeal filed by the State along with the delay condonation application, seeking condonation of an inordinate delay of 2648 days. It is evident that, first among these appeals, LAA Nos.1208/2009 and 1229/2009 were admitted as early as in the year 2009. So also, LAA No.737/2013 **LAA No.1208/2009 and connected cases** **-21-** arising out of LAR No.426/2008 was filed in the year 2013 and this Court had admitted the said appeal in July 2015. The State had filed LAA No.50/2018 only when this court had started final hearing of the other appeals, in the year 2018. In the affidavit filed in support of the delay condonation application, it is stated that, the District Collector had recommended for filing the appeal, as early as in the year 2010. But it was opined from the office of the Advocate General that there is no scope for filing an appeal in the matter. It is stated that, the District Collector again made a request to examine the scope for filing an appeal. It was opined from the office of the Advocate General that the matter need not be further considered, as there is no scope for filing any appeal. The said decision was taken in July 2012, as mentioned in the affidavit. It is further stated that, only when the appeals filed by the claimant was taken up for hearing, the matter was noticed by the Government Law Officers, who opined that the judgment need to be challenged through an appeal. Therefore, it is stated that, the Government was refrained from filing the appeal within any reasonable time, only because of the opinion expressed by the Law Officers of the Government at the relevant time. We had also perused the Memorandum of Appeal filed by the State in LAA No.50/2018. The main challenge on **LAA No.1208/2009 and connected cases** **-22-** merits is based on the contention that the judgment of the Reference Court is bad for non joinder of necessary parties and that it is liable to be set aside for the said reason. It is true that, in the grounds of the appeal, a contention is raised that the amount awarded by the court below is exorbitant and that no compensation could be awarded for value of the building acquired. With respect to non-impleadment of the NHAI, we had already arrived at a finding in the foregoing paragraphs. The reasoning mentioned therein for not setting aside the judgment of the reference court and not for remanding the case for fresh disposal, is equally applicable with respect to the contentions in the appeal filed by the State. We also take note of the fact that a change in the opinion of the Government Law Officers, that too after the lapse of a long period of more than 6 years, cannot be considered as a cogent reason for condoning the inordinate delay of 2648 days. As far as the court is concerned, it is the very same State Government who took a decision earlier with respect to the scope for filing of the appeal and it cannot be permitted to change its attitude at a highly belated stage, when the appeals filed by claimants are being disposed of. Therefore, we are not inclined to condone the delay occurred in filing of LAA No.50/2018. As a consequence, C.M Appln.No.68/2018 is liable **LAA No.1208/2009 and connected cases -23-** to be dismissed. Consequently, LAA No.50/2018 is also liable to be dismissed. However, we make it clear that the State Government as well as the NHAI can be given liberty to contest the other appeals filed by the claimant on its merits. 12. We may now proceed to consider the appeals filed by the claimant on merits. As already observed, total extent of land held by the claimant in the area was 1 Hector 59.36 Ares. Extent of the land covered by LAR Nos.172 & 173/2007 is, 1.89 Ares and 1.47 Ares, respectively. Notification under Section 4 (1) with respect to the acquisitions in these cases was on 27-09-2005. The property was taken over possession on 13-04-2007. The LAO fixed land value @ Rs.74,326/- by including the acquired land under category 5A, which is described as “land having access to panchayat road”. The LAO relied on Document No.976/2004 which is a Sale Deed executed on 16-03-2004, with respect to a property situated in Kothad Island itself, in Kadamakudy village. Value reflected in the said Document is Rs.59,137/- per Are. The LAO fixed the land value by giving 25% increase from the value contained in the basic document, considering the time gap of about 1 ½ years. The Reference Court found that, the acquired land is having access to both the Panchayat Road as well as the National Waterway. Whereas the land covered under the basic **LAA No.1208/2009 and connected cases** **-24-** document had only an access to a Mud Road. Therefore it was found that, the acquired property need to be included in category No.2A, which is described as “land having access to panchayat road and national waterway”. Based on Ext.C1 Commission Report the Reference Court found that, the land under the basic document is situated at a distance of about 2.5 Kms. away from the acquired properties and that the acquired land is situated in a very prominent location than the land covered under the basic document. The Reference Court found that, the land value fixed by the LAO with respect to category 2A is Rs.80,633 per Are. Therefore by giving 25% increase from the said value, the Reference Court enhanced the land value to Rs.1,00,791/- per Are. 13. According to the appellant/claimant land value fixed by the Reference Court is highly inadequate and insufficient. It is contended that, the Reference Court had illegally discarded Ext.A3 to A8 documents produced by the claimants. It is argued that the property covered under Ext.A3 to A8 are more or less similarly situated or are similar in nature to that of the acquired properties. Learned counsel for the appellant/claimant pointed out that, after construction of the Bridge connecting Kothad Island with the main land, in the year 2005, there occurred as **LAA No.1208/2009 and connected cases** **-25-** sudden hike in the market value of properties situated in Kothad village, which factor was omitted notice of the Reference Court. With respect to Ext.A3 to A8 documents, the Reference Court observed that, the Advocate Commissioner had noticed that the properties are situated at a distance of 1.5 Kms. to 2.5 Kms. away from the acquired properties. It was noticed that the exemplars under Ext.A3 to A8 are properties situated in other Islands at Mulavukad and Thanthonnithuruth. It was also found by the Reference Court that, most of the Documents are postnotification documents. It was found that the locational importance of the acquired property and that of Ext.A3 & A8 properties are not similar. The locational importance and prominence available to the properties at Mulavukad are not at all similar for the properties in Kothad Island, at the time of acquisition, is the finding. It was categorically found that, Mulavukad is a thickly populated area connected with the main land of Ernakulam by a Bridge. So the locational importance of the properties in Mulavukad is not at all available to the properties situated in Kothad Island. The Reference Court observed that, the version of the claimant is only that, after construction of Bridge connecting 'Kothad' and the main land, importance of the acquired property had increased. But the **LAA No.1208/2009 and connected cases** **-26-** court below observed that, the exact date of construction of the bridge was not established. Learned counsel for the appellants pointed out that it has come out in evidence before the Reference Court that Bridge in question was inaugurated on 3101-2005. Therefore the Reference Court ought to have considered the said aspect, is the contention. 14. It is a fact that the Kothad Island was remaining isolated from the main land of Cochin, till it is connected through the Bridge, which was inaugurated on 31-01-2005. Till that time, access to the Island was through boats/jankars operated through the National Waterway. It was pointed out that, since starting of the construction of the Bridge, there occurred a steep hike in the market value of the properties situated in Kothad village. Evidently, the acquired property was situated on the beginning of the Island, having frontage to the National Water Way, as well as to the panchayat road. Therefore it is contended that the reliance placed on the basic document, which is a Sale Deed executed at about 1 ½ years prior to the date of the notification, that too with respect to a land situated in the interior part of the island at a distance of 2.5 Km. from the acquired property, is improper and unacceptable. It is pointed out that, Ext.A4 is a Sale Deed with respect to a property **LAA No.1208/2009 and connected cases** **-27-** situated in the interior part of Mulavukad island, which was connected only through a panchayat road. It was illustrated that the extent of the property covered under Ext.A4 Document was only 4 cents and the sale price noted therein is Rs.93,750/- per cent, which is equivalent to Rs.2,31,656/- per Are. So also it is pointed that Ext.A3 is another Sale Deed with respect to 40 cents of paddy field situated in Mulavukad island, which is having no access to any road. It is a Sale Deed executed on 0901-2001 and the value shown in is Rs.29,500/- per cent, which is equivalent to Rs.72,894.50 per Are. It is contended that, the Reference Court was not right in discarding these documents, merely because the properties are situated in other islands. But, as observed by the Reference Court, Mulavukad is an island which is situated close to Cochin main land. As on the date of acquisition, the Mulavukad island was remaining connected with the main land through the “Gosree Bridges”. Therefore the market value of the properties situated at Mulavukad Island, remained much higher than the value in any other islands situated in the backwater of Vembanad Kayal. It is to be noted that, the land value fixed by the Reference Court with respect to the acquired properties is at a higher rate than the sale value covered in Ext.A3 Document. But with respect to Ext.A4 **LAA No.1208/2009 and connected cases** **-28-** document, eventhough it is not a post-notification document the value shown therein cannot be adopted as basis for fixing land value of the acquired property, because of the more prominence available in locality and due to proximity to the developed area. Therefore we are of the opinion that non-acceptance of Ext.A3 to A8 exemplars by the Reference Court cannot be challenged successfully. 15. It is true that the Bridge connecting Kothad with main land was inaugurated in January 2005, which has 9 months prior to the date of the Section 4 (1) notification. Definitely, construction of the Bridge might have been started at least before 2 years from the date of its inauguration. Therefore there is substance in the contention of the appellant that, there occurred a steep hike in the price of land in Kothad village, since the construction was started. But at the same time, the market value cannot be fixed based on Ext.A4 Document. As observed by the Reference Court, the land covered under the basic document is situated in a more interior area in the island. The acquired property is situated in a more prominent area, having more proximity to the main land connected through the Bridge. The locational importance of the acquired land might have increased many fold, after establishing connectivity through the Bridge. ## **LAA No.1208/2009 and connected cases** **-29-** Therefore we find force in the contentions raised by the appellants that there occurred a sudden spurt in the market value of the land in the area in question, after establishment of the Bridge. Taking note of all the above said aspects, the Reference Court had fixed the land value at Rs.1,00,791/- per Are. This in effect is having 70% increase from the value of the basic document. As already mentioned, property covered under the basic document and the acquired property differs in quality on many aspects. The acquired property is having road frontage as well as frontage of the National Waterways. Whereas the land under the basic document is only having access to a Mud Road. The acquired property is situated on the beginning of the Kothad island, immediately after the Bridge, in a more prominent area having close proximity to the main land of Cochin. The land under the basic document is situated at an interior area at about 2.5 Kms. away from the acquired property. The basic document was executed at about 1 ½ years prior to the date of Section 4 (1) notification. All these aspects, coupled with the facts that the market value of the properties in the Kothad Village might have been increased considerably since the starting of construction of the bridge, would tend this court to allow further enhancement of the land value to a reasonable extent. It is noticed that in LAR **LAA No.1208/2009 and connected cases -30-** No.426/2008 the court below had placed on the land value fixed in LAR Nos.172 & 173/2007, for refixation of land value of the acquired properties therein. On an overall consideration of the entire circumstances as mentioned above, we are of the opinion that the land value can be refixed by giving 100% increase from the value shown in the basic document, instead of the increase of 75% awarded by the Reference Court. Thus we are inclined to refix the land value of the acquired properties in all the 3 cases at Rs.1,18,274/- per Are. 16. Learned counsel for the appellants raised vehement contentions by relying on a letter issued by the Kerala Financial Corporation (KFC) to the LAO, which form part of the records in the 'Notes to Award' and other documents of the LAO in LAR Nos.172/2007 & 173/2007. The Chief Manager of the KFC had addressed the LAO through the said letter, dated 12-10-2006, informing that the properties proposed to be acquired with all the structures and improvements contained therein, stands mortgaged to the KFC for the loan advanced to the Resort Project. Therefore it was informed that the Corporation is holding first charge over the property sought to be acquired. It is mentioned that, originals of the title deeds with respect to the land remains deposited with the Corporation, for creating the **LAA No.1208/2009 and connected cases -31-** equitable mortgage. It is further stated that the loanee had defaulted repayments and there is a huge balance outstanding. In the said letter, the KFC had informed about the valuation conducted with respect to the assets of the Resort. It is particularly stated that the value of the land having an exent of 1 Hector 59.36 Ares was estimated to 275.10 lakhs. According to learned counsel, the value estimated by the KFC will work out to more than 1,72,600/- per Are. It is contended that, the information furnished in Ext.A11 letter need to be accepted as a proper valuation about the market value of the property prevailed at the time of the acquisition. We are not persuaded to accept such a contention for more than one reasons. First of all, Ext.A11 cannot be considered as a Valuation Certificate. The letter in question was issued on 12-10-2006, much after the notification under Section 4 (1). It is only mentioned in the letter that the valuation of the assets was estimated by the KFC is not indicated therein. But nothing is discernible as to who had conducted the valuation or as to what was the basis for arriving at the value shown therein. Nobody was examined from KFC to prove the said document. The person who made the valuation was not examined. Nor any proof is adduced to the effect that such person who estimated the valuation is an approved valuer, **LAA No.1208/2009 and connected cases** **-32-** having any expertise in the field. Therefore we are of the opinion that Ext.A11 cannot be based for refixing market value of the acquired properties prevailed at the time of the acquisition. 17. The next question to be considered is regarding the enhancement sought with respect to value of the building, in LAR No.426/2008. As already observed, the LAO has not awarded any compensation for the building situated in the acquired land, on the premise that it is an illegal construction done in violation of the CRZ Notification. This court in the judgment in W.P (c) No.13949/2008 had relegated the issue for the decision of the Reference Court. It was noticed by the Reference Court that, when the draft Award was prepared and sent for approval to the Government, the LAO had included compensation for building also,. But the Coastal Zone Management Authority had intervened and informed the local authority, the Kadamakudy Panchayat, that the buildings in the Resort is in CRZ category No.I and the construction is done in violation of CRZ Notification, 1991. Based on the information furnished by the Coastal Zone Management Authority, the local authority had issued notices requesting demolition of the illegal constructions. Based on this, the NHAI had informed the District Collector about the violation of the CRZ Notification and **LAA No.1208/2009 and connected cases** **-33-** requested to delete the cost of the construction, mentioned in the draft Award. Accordingly the Award was revised. The respondents before the Reference Court had taken a strong contention that no compensation for the acquired building can be given, as it is an illegal structure. But the Reference Court found that under the Notification, for implementation of the provisions, certain formalities have to be complied with. It is stated that, the CRZ Notification specifying the area is to be published by preparing the “Coastal Zone Management Plan”, for identifying and classifying the 'Coastal Regulation Zone'. The ITL and HTL delineations is to be prepared “Local Level Coastal Zone Management Plan” is to be drawn and only if such documents are available, the question of CRZ violation can be ascertained. It was noticed that the “Coastal Zone Management Plan” was prepared and approved only in the year 1996. Still the 'Local Level CZMP Plan' was not prepared. So also the ITL and HTL delineations was also not prepared. It is stated that, the respondents have not produced any evidence before the Reference Court to prove their claim regarding violation of the 'Coastal Regulation Zone'. The claimants have taken a contention before the Reference Court that, the building in question was started construction after obtaining necessary permission and **LAA No.1208/2009 and connected cases** **-34-** licences from the concerned local authority and the Departments concerned, after complying with all the requisite legal formalities, in the year 2000. The Reference Court noticed that as per Ext.A18, dated 25-07-2000 the Kadamakudy Grama Panchayat had given 'No Objection Certificate' for the construction of the Resort by stipulating only 3 conditions; including the condition that the building construction shall be at 100 meters away from the river bank. It is noticed that, by complying with such conditions the claimant had started the construction based on Ext.A20 plan and it was completed in the year 2002. Thereafter, licences was granted from the Panchayat for running the Hotel and the local body had collected tax for the buildings. The Resort in question had obtained permission from the Tourism Department of the State of Kerala, as evidenced from Ext.A3 (in LAR No.426/2008) dated 03-11-2000. From all these evidence, it was noticed that, the construction was completed in the year 2002 and the Resort had started functioning thereafter. The Reference Court specifically observed that at the time when the construction was completed the Coastal Zone Management Authority was not even constituted, as it is revealed that the committee was constituted only on 0401-2002. The court below noticed that, at the time of Section 4 **LAA No.1208/2009 and connected cases** **-35-** (1) Notification, there existed no action taken against the claimant with respect to the alleged violation of CRZ Notification and all the requisite consents and permissions were obtained by the claimants before the building was constructed. Years after that, based on an alleged violation of 'CRZ Notification' the claimants cannot be denied of compensation for the building acquired, is the finding of the Reference Court. 18. As observed in the foregoing paragraphs, neither the State nor the NHAI had filed any appeal challenging findings of the Reference Court as mentioned above. Even before this court they are not in a position to make any successful challenge against such findings. Therefore we are of the opinion that, the finding of the Reference Court that claimants are entitled to get compensation for the building need to be upheld. With respect to the quantum of compensation awarded in this regard, the claimants have sought for enhancement. It is the contention of the appellant/claimant that, valuation adopted by the Reference Court based on Ext.A12 Valuation Statement given by M/s. KITCO, is not proper and justified, in view of the fact that huge amount was deducted towards depreciation. It is pointed out by learned counsel for the appellant that, in other cases covered by the same acquisition, negotiated purchases were effected **LAA No.1208/2009 and connected cases -36-** through the decision of the “District Level Purchase Committee (DLPC)”, without deducting depreciation on the value of the buildings. In this regard, the appellant had not produced any conclusive proof. More over we are of the considered opinion that the method adopted to arrive the value in negotiated purchases cannot be taken as a yardstick in the matter of awarding compensation. We are of the considered opinion that the Reference Court was right in adopting Ext.A12 Valuation Statement prepared by KITCO as basis for fixing value of the building acquired. Hence we do not think any interference is possible in this regard. 19. Another aspect agitated in these appeals is against denial of compensation for loss of earnings sustained by the claimants, because of stoppage of business of the Resort, consequent to the acquisition. Learned counsel had pointed out that, since the major amenities required for running of the Resort were acquired and demolished, the claimants had to shut down the Resort and was forced to stop the business activities. Therefore it is contended that, the claimants are entitled to get compensation as contemplated in “Fourthly” of Section 23 (1) or under “Sixthly” of the said Section. The Reference Court found that, from Ext.A3 letter issued from the Tourism **LAA No.1208/2009 and connected cases** **-37-** Department it is evident that, after the acquisition the claimants were not in a position to continue the business as a 'Three Star Resort'. It was noticed that the claimants have not made any claim on account of the injurious affection with respect to the balance property. But the injurious affection on account of loss of earnings was the claim. Referring to a decision of the hon'ble Supreme Court in **Ramesh Dutta. V. State of Punjab ((2004) 7 SCC 388)** it was argued that, the damages sustained by a person at the time of taking possession of the property, by reason of his earnings being affected, is to be compensated and paid. While considering what should be the just and fair compensation it has to be worked out as to what the earnings of the claimants were in respect of the business and should consider how much time would be taken to restart such business. Based on the above principle the Reference Court found that, compensation on account of loss of earnings can be allowed to a claimant who has forced to abandon the business conducted at the acquired site. But it is noted that, in the case at hand, in order to substantiate such claim, the claimant could produce only Ext.A17 document, for the proof of which AW4 Chartered Accountant was examined. On a perusal of Ext.A17 the Reference Court observed that, an expected profit for the **LAA No.1208/2009 and connected cases** **-38-** future period of 20 years was reckoned as the loss of earnings. But it was observed by the Reference Court that, the claimant is not entitled to get compensation on the basis of the capitalized value for 20 years, because the loss of earning need to be granted only for the period they will take to restart their business and to receive income therefrom. Therefore prima facie it was observed that, Ext.A17 cannot be taken as basis to ascertain the loss of earnings. Further, the Reference Court observed that, no supporting documents to prove what exactly is the monthly and annual income of the Resort was not established. Specifically it is observed that the claimant have failed to produce the 'Balance Sheet' or the Returns filed before the Income Tax authorities, showing the income, or any other data to calculate the loss of earnings. Therefore it was observed that AW14 had prepared Ext.A17 document without any supporting evidence and without proving as to how she had arrived at the loss of earnings projected. Under such circumstances, the Reference Court had denied compensation with respect to loss of business earnings. 20. Learned counsel for the appellant had drawn our attention to Ext.A17 document. It is argued that the projections contained in Ext.A17 are based on the 'Profit and Loss Account' **LAA No.1208/2009 and connected cases** **-39-** of the firm and is based on the income derived and expenditure incurred during various years, from 2003-2004 to 2007-2008, which is distinctly shown therein. We have also evaluated the testimony of AW4. As observed by the court below, we are not convinced that the claimants are not successful in proving any Audited Balance Sheet and/ or Profit and Loss Account of the company in question, which is authenticated and filed before the Registrar of Companies or before the Income Tax authorities. Therefore the projection of financial loss prepared by a Chartered Accountant cannot be taken as basis for determining the loss of earnings, if any. Learned counsel for the appellant had drawn our attention to Section 65 G of the Evidence Act, in order to canvass the position that an evidence adduced through a Chartered Accountant need to be considered as primary evidence. In support of such contention he had placed reliance on a decision of the High Court of Delhi in **National Highway Authority of India V. Hindustan Construction Co. Ltd. (2017 5 ARB L R 258 (Delhi)** . It is held therein that, production of a certificate of the Chartered Accountant was inconsistent with Section 65 of the Indian Evidence Act. It is stated that, the party can adduce secondary evidence on the aspect of finance and accounts by producing Certificate of the **LAA No.1208/2009 and connected cases** **-40-** Chartered Accountant. But in the case at hand, as already observed, it is not the Audited Balance Sheet or Profit and Loss Account, which was produced as Ext.A17. But it is only a projected estimation of the loss of earnings. The appellant had filed IA No.86/2018 in LAA No.736/2013 seeking for acceptance of additional records produced, which are stated to be the Auditor's Report for different years showing the Profit and Loss Account as well as the Balance Sheet of the company, which owned the Resort. First of all, such documents cannot be accepted without sufficient proof. Secondly it is noted that, in most of the years covered by those reports, the company was running at net loss. Learned counsel for the appellant pointed out that, the Auditor's Report includes the accounts with respect to business activities of the company, having Hotels in other places. Secondly it is pointed out that, the net loss was calculated after depreciation and after deducting liabilities by way of the loan existing. According to learned counsel for the appellant, the loss of earnings need to be calculated by considering the receipts in the operation of the Resort, for which deduction of the operational expenses alone need to be considered. However, we are of the opinion that, even by accepting the documents now produced in appeal, it cannot be **LAA No.1208/2009 and connected cases** **-41-** illustrated as what exactly is the earnings received at the resort during the relevant period. Learned counsel for the appellant fairly conceded that, the Books of Accounts pertaining to the Resort was not traceable at this point of time. But on consideration of the entire circumstances, we are of the opinion that the appellant/claimant is not successful in proving through any convincing and acceptable evidence that they have sustained loss of earnings which need be compensated under provisions of Section 23 (1) 'fourthly' or 'sixthly'. Therefore we are not persuaded to interfere with the findings of the Reference Court in this regard. 21. Eventhough the appellant/claimant has pleaded for enhancement in the valuation of the improvements, no acceptable evidence is forthcoming regarding the details of the improvements, its age or value. Therefore we are not in a position to consider any such claims. In the result, the appeals are disposed of on the following terms: (i). CMA No.68/2018 in LAA No.50/2018 is hereby dismissed. As a consequence, LAA No.50/2018 is also dismissed. (ii). LAA Nos.1208/2009, 1229/2009 and 737/2013 are allowed in part, to the extent of enhancing the compensation **LAA No.1208/2009 and connected cases** **-42-** with respect to the land value to Rs.1,18,274/- per Are, relating the extent of land acquired in each of the cases. (iii). The appellant/claimant will be entitled for all the statutory benefit on the enhanced compensation as provided under Section 23 (1A), 23 (2) and 28 of the Land Acquisition Act. The interest is payable only for the period as mentioned in the impugned judgment of the Reference Court. **Sd/-** **C.K.ABDUL REHIM JUDGE** **Sd/SHIRCY V. JUDGE** ## **Ks/Smm/AMG**