Mohammad Yusuf and Others etc. etc. vs State of Haryana and Others

HELD: 1.1 The intention behind the enactment of the Land Acquisition Act, 1894 was to acquire land for welfare purposes and to compensate the owners adequately. It is well known fact that the Right to Property is a Constitutional Right (earlier it was a Fundamental Right until 1978) as provided under Article 300A of the Constitution of India. The term “compensation” was interpreted by Supreme Court in a number of cases that it is to be “a just equivalent of what the owner has been deprived of.” Hence, the acquisition must pass the test of compensation being reasonable, just and fair. In a catena of cases, Supreme Court has held that compensation should be adequate and there must be no injustice with the land owners since they stand deprived from their very vital right i.e. Right to Property. At the same time, it is also to be kept in mind that no hypothetical view shall be taken as it may be harmful to the public exchequer in case of acquisition for public purposes. Hence, courts must maintain balance between both the parties.[Paras 10, 11][1081-C-D, E-F]

1.2 On a plain reading of Section 23 of the LA Act, it is evident that the compensation has to be calculated according to the value of the land to the owner and the question to be considered is whether the person from whom the land was taken was to lose by having it taken from him. The probable use to which the land might be put was necessarily an element to be taken into consideration for calculating the compensation of acquired land. The land owners get compensation on the basis of the value of the land, in its actual condition at the time of the publication of the Notification under Section 4 of the LA Act. [Para 13][1082-H; 1083-A-B]

1.3 It is a well established rule that in the cases of calculation of compensation, there cannot be a straight jacket formula, hence, each case has to be dealt in the light of circumstances of each case. Common sense is the best and most reliable guide. It is a well settled law that when there are several exemplars with reference to similar land, usually the highest of the exemplars which is a bonafide transaction, will be considered. [Paras 14, 15][1083-D-E]

1.4 The appellants produced various sale deeds. The vital sale deed dated 05.10.2005, wherein land admeasuring 1 kanal 6 Marlas, situated in village Ferozpur Namak, Tehsil Nuh, was sold for a sale consideration of Rs. 11,70,000/- in the same village. If the value of per acre in terms of the above sale deed is calculated then it stands at Rs 72 Lakhs per acre. The date of this sale deed is 05.10.2005 which is proximate to the date of Notification i.e., 18.10.2005 under Section 4 of the LA Act. In the present case, after having regard to the circumstances of the case and perusal of the sale deeds of adjourning area, the compensation granted at the rate of Rs. 72 lacs per acre is as per the law and no injustice has occurred to the appellants herein. [Para 16][1084-D-F]

1.5 It is a matter of record that the Reference Court determined 60% (55% as development charges and 5% for waiting period) in totality towards development charges which later on in appeal reduced by the High Court to 10%. Deductions may be made for a variety of reasons, which may differ in different cases. However, in the backdrop of judicial precedents on this issue, it is well settled position that all deductions should not cumulatively be exceeded the upper benchmark of 75% and at the same time, it should be kept in mind that no hypothetical view shall be taken in order to calculate the percentage of the development charges. The appellants contended that the acquired land has all basic facilities such as water, electricity, sewer, telephone etc which respondent-State has not disputed. These are, however, not enough to meet the purpose of acquisition. To make such land suitable for the acquisition purpose i.e. for the construction of Mini Secretariat at Nuh, some further development is sine qua non. For calculating the percentage of development charges, various factors need to be taken into consideration such as location of land, facilities available in nearby area, size of the land, purpose of acquisition etc. The present acquired land of Firozpur Namak village which is located at some distance from the Nuh Town needs to be developed in proper manner like construction of better and wide roads etc., to make it suitable for the acquisition purposes. The fact that facilities already available such as sewer, electricity etc., seems to be taken into consideration properly while reducing the development charges by the High Court from 60% to 10%. In the case at hand, in view of the facts and circumstance noticed hereinabove, a cut at the rate of 10% is very reasonable towards development of acquired land as some further development would obviously be required to make it fit for the purpose for which it was acquired. [Paras 17, 18 and 19][1084-H; 1085-A-F]

Major General Kapil Mehra and Ors. v. Union of India & Anr. (2015) 2 SCC 26 – referred to.