Determining Market Value and Deduction of Development Charges in Land Acquisition Case

1182-1210 OF 2023@ of SLP(C) Nos.3446-

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3474/2023 @ D.No.11863 of 2022) C.A.NOS.

1179-1181 OF 2023@ of SLP (C) Nos.10577- 79/2022) C.A.NOS. The lands which were owned by the appellants formed a part of the lands that were notified under Section 4 read with Section 17 (2) of the Land Acquisition Act, 1894 (for short ‘Act, 1894’) by the Haryana Government Industries Department. The High Court, on consideration, had through its judgment dated 05.02.2016 enhanced the market value to Rs.62,11,700/- per acre.

The Reference Court on re-appreciation of the evidence and materials available on record has through its judgment and award dated 10.01.2020, determined the market value of the acquired lands at Rs.22,00,754/- per acre.

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The gist of the contention on behalf of the land losers is that the lands which are the subject matter of these appeals are situated in Sultanpur which is within the urban agglomeration. Having done so, the only error committed by the Reference Court is to deduct 35 per cent of the value towards development charges inasmuch as in the instant case, the question of deducting development charges would not be justified as the entire acquired land has been utilized for the purpose of constructing roads.

It is the further contention that on the other hand, the HSIIDC had relied on, as many as nine sale exemplars between the period 23.07.2004 and 25.11.2005 wherein the larger extent of agricultural land had been sold and the value per acre in all the said instances is lesser than the floor rate which had been taken into consideration. In the light of the rival contentions, keeping in view that the only question herein is to determine the appropriate market value for the acquired lands, the well-settled yardsticks are to be kept in view and a decision is to be taken as to whether the High Court was justified in interfering with the manner of consideration made by the Reference Court and as to whether the High Court was correct in adopting the amount as indicated in the circular providing for the floor rates for fixing the market value in the teeth of the other documents which were available on record. In that view, in the light of the said circular, without relying on the same, this Court had directed that the evidence be tendered by the parties before the Reference Court so as to make such evidence the basis for fresh determination to be made. From the records, it is pointed out that as contended on behalf of the parties, the sale exemplars were brought on record to aid the Court to determine the market value, the consideration of which was required to be made to arrive at an appropriate market value. This Court had enunciated the principle that the price agreed between a willing seller and a willing purchaser would be the price which is generally prevailing in the market in respect of the lands having similar advantages which can be the basis to determine the market value of acquired lands if such sale instances are brought on record. On reckoning the said value of land, the Reference Court deducted 35 per cent of the same towards development charges and thereafter added the escalation for 35 days being the difference of the period between the date of the said sale deed and the date of the preliminary notification. The position of law is well settled that when large extent of lands are acquired and if the sale exemplar, also for the large extent is available on record it would be safer to rely on the same if they are comparable transactions. In the instant case, though the acquisition Notification dated 11.01.2005 was issued in respect of the large extent of lands measuring 798 Kanals and 2 Marlas, the extent of lands which were owned by majority of land losers is a small extent. In cases, where the large extent of agricultural land belonging to a single owner is acquired, it would no doubt be safe to rely on such sale exemplars of large extents, more particularly, in circumstances where the land which is classified as agricultural land is also used for agricultural purposes. However, the difficulty arises when a person holds a smaller extent of land which is classified as agricultural land but would have lost its character due to non-cultivation and urbanization when such land is more eminent and fit to be used for non-agricultural purposes. Therefore, in that circumstance when smaller extent of land is available, the same would be used for urban development and not for agricultural purpose. Since small extents of land belonging to the land losers, having non- agricultural potential in an urban area was notified for acquisition, the said sale exemplar dated 07.12.2004 can be considered as comparable. Having arrived at the above conclusion, the next aspect which engages our attention is with regard to the appropriate deduction towards development charges and as to whether the Reference Court was justified in deducting 35 per cent of the value from the market value arrived at based on the document at Ex.PX. (2017) 2 SCALE 323, also a decision where this Court held that the deduction of 40 per cent as made in the said case when the land acquired was roughly 1 kanal to 1 acre per person which ultimately totals up to 305 acres which was acquired, is not justified is relied upon. through the order dated 21.09.2017 in Civil Appeal No.15702/2017 arising out of SLP (C)

No.16063 of 2016 and connected appeals had taken into consideration the entire perspective relating to the deduction of development charges with reference to the earlier decisions of this Court in Haryana State Agricultural Market Board & Anr.

Hence, taking all aspects into consideration and also taking into consideration that the sale exemplar for a smaller extent is being relied on for the reasons noted above, in the facts and circumstance arising herein, it would be appropriate to reckon the deduction towards development cost at 25 per cent of the value taken into consideration under the document Ex. The learned counsel for the appellants contend that if this Court determines the market value at a lesser rate than what has been paid to some of the appellants, such of those land losers who have received the amount, be protected against recovery. Therefore, it is needless to mention that if any excess amount has been received by any of the land losers than the extent of the compensation determined herein, the excess amount, in any event, is recoverable.

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In the result, we pass the following order; (i) The judgment dated 07.10.2021 passed by the High Court of Punjab and Haryana at Chandigarh in RFA No.421/2021, RFA No.848/2021 and connected appeals, impugned herein, is set aside. (v)

Case Title: RAVINDER KUMAR GOEL Vs. THE STATE OF HARYANA (2023 INSC 129)

Case Number: C.A. No.-001173-001173 / 2023

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