Union of India vs Ramchandra & Ors.

HELD: 1.1 The brochure issued by the Development Authority of fully developed plots cannot form basis for award of compensation for acquisition of undeveloped lands. The entire process of determination of the market value by the Reference Court is contrary to the established principles of determination of the market value of the acquired land as the sale of developed land for the purpose of residential plots cannot be made basis for acquisition of undeveloped agricultural land. Still further, the acquired land can be said to be 41,771.32 square feet but the compensation has been awarded for the entire land of the Company as against the small area which was acquired for the railway line, though the balance land is owned and is in possession of the Company. The market value of Rs.25/- per square feet by the High Court has been arrived at on the basis of statements of some of the witnesses. No sale instance of the acquired land has been produced, not even the sale deed by which the Company has purchased the land almost 3 years prior to the acquisition. Such sale instance would have been the best yardstick to arrive at the market value of the acquired land. The High Court awarded Rs.19/- per square feet as the compensation of the entire land acquired. Though we are unable to agree with the reasoning, but in the absence of any other alternative to determine market value, we do not wish to interfere with the market value assessed by the High Court. One cannot understand that how such large chunk of land can be said to be unsuitable for any industry or any evidence suggesting that industry could not be set up in such large piece of land abutting road. The Company has not produced any drawings to say that their factory cannot be put up in the remaining compact land measuring more than 130000 square feet. Therefore, compensation for the entire land owned by the Company is wholly unwarranted, illegal and unduly advantageous to the Company.[Paras 16-19][272-D; 273-C-G]

Lal Chand v. Union of India & Anr (2009) 15 SCC 769 – relied on.

1.2 Even in respect of land on the eastern side of the railway line, it is not that such land cannot be utilized for any purpose. There is land of the other land owners on the other side, therefore, the same can be used for different purposes, may not be for industry. Therefore, the compensation of Rs.19/- per square feet awarded for such land is not sustainable on any principle of law. The compensation of land on the western side of the railway track is to be awarded only as the agricultural land. Section 23 of the Act specifies the factors to determine the amount of compensation to be awarded for the land acquired. Clause thirdly is for determining damages sustained by the person interested at the time of the Collector’s taking possession of the land by reason of severing such land from other land. Such provision has to be read along with Section 49 of the Act. There was an option with the appropriate Government to acquire the entire land without publication of any fresh notification if the appropriate Government was of the opinion that the claim of compensation on account of severing of the land is unreasonable or excessive. The Union has not exercised such option. Therefore, the compensation has to be determined keeping in view of the fact that the land is continued to be owned by the Company but its effective use stands diminished to large extent. the land situated on the western side is 139163 square feet (1.29 Hectare), which is not a small area from any angle, therefore, the appropriate Government was justified in not acquiring the said land and for the reason that the claim of compensation of such land is unreasonable or excessive. In fact, the Company had no claim in respect of the land situated on the western plank of the railway line. In respect of the land situated on the eastern side, the first impression is that the land is severed but if the plan produced by the Company is examined, there is land of other land owners as well. Therefore, it is not the entire land which has become unapproachable or land locked. Because of the railway line, may be the Company has to take a detour to approach such land but not that the substantial portion of the land cannot be used for any of the ancillary works of the Company. On account of the fact that the Company can approach the land on the eastern side by taking a detour, the Company will incur an additional cost, therefore, the Company is entitled to such additional cost. [Paras 20, 21, 23-25][274-A-C; 278-D-H]

Walchandnagar Industries Limited v. State of

Maharashtra & Anr (2022) 5 SCC 71 – relied on.

1.3 Compensation on account of severance is not entitled to the benefit of Section 23(1-A) and Section 23(2) of the Act, as the market value is determined in terms of Section 23(1) firstly, whereas the compensation on account of severance of land is determined under Section 23(1) thirdly. The process of determining compensation by the Reference Court is wholly fallacious. Thus, the appeal of the Company claiming enhancement of the compensation @ Rs.40/- per square feet is untenable. Even the compensation determined by the High Court is questionable but we do not find any reason to interfere in the present appeal under Article 136 of the Constitution. Furthermore, the Company shall be entitled to Rs.9.5 per square feet in respect of land situated on the eastern side after leaving 30 meters of the buffer zone but without any benefits under Section 23(1-A) and Section 23(2) of the Act. [Paras 28, 29][279-G; 280-E-F] State of Punjab v. Amarjit Singh & Anr. (2011) 4 SCC

734 – relied on.

1.4 The land owners including the Company shall be entitled to compensation of their land situated within 30 meters from the middle of the railway track on both sides @ Rs.19 per square feet. The Company shall be entitled to compensation on account of pillars raised amounting to Rs. 14,34,300/- as well. The land owners including the Company shall be entitled to statutory benefits under Section 23(1-A) and Section 23(2) of the Act on such land. In respect of land after the extent of 30 meters on the western side of the railway track and abutting the road from Maksi to Ujjain, no compensation would be payable. In respect of remaining land after the extent of 30 meters on the eastern side of the railway track, the Company shall be entitled to compensation on account of severance of land @Rs.9.5 per square feet but such compensation shall be without any benefits under Section 23(1-A) and Section 23(2) of the Act.[Para 30][280-G-H; 281-A-C]

Tehal Singh & Ors. v. The State of Punjab through the Collector, Land Acquisition, Drainage Circle, Patiala & Ors. 1987 SCC OnLine P&H 269 – approved.