Explore the intricacies of the land valuation dispute in NOIDA as the Supreme Court settles the compensation enhancement case. This case involves a clash between landowners seeking parity with Bir Singh judgment and NOIDA authorities contesting the enhancement of compensation rates. Dive into the legal intricacies unfolding between the parties to understand the Supreme Court’s pivotal ruling.
Facts
- The New Okhla Industrial Development Authority (NOIDA) and landowners contested High Court orders enhancing compensation for land acquisition initiated under the Land Acquisition Act, 1894 (1894 Act).
- Landowners sought parity with Bir Singh (supra) for compensation enhancement to INR 449 per sq. yd.
- NOIDA filed appeals challenging High Court judgments decided based on Bir Singh (supra).
- Compensation rates varied between orders, with INR 222 per sq. yd. possibly resulting from a calculation error.
- Acquisition of approximately 492 acres of land in Village Chhalera Bangar was initiated by State of U.P./NOIDA in 1991.
- Rate of compensation was finally determined at INR 110 per sq. yd. after a 12% deduction due to the large area under acquisition.
- Landowners made reference before Reference Court seeking enhancement of compensation after possession of land was taken in stages.
- The High Court enhanced compensation from INR 222-233 per sq. yd. to INR 449 per sq. yd. in line with Bir Singh (supra).
- The High Court reversed deductions made by the Reference Court and directed State/NOIDA authorities to recalculate compensation at INR 297.50 per sq. yd.
- A later application led to clarification, and compensation was enhanced to INR 340 per sq. yd.
- In Civil Appeal Nos. 18620-18623/2017 titled Bir Singh v. State of Uttar Pradesh, the compensation was further enhanced to INR 449 per sq. yd based on a sale exemplar.
- Review and Curative Petitions by State/NOIDA against this order were dismissed.
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Issue
- The court needs to deliberate on enhancing the compensation for the landowners
- The extent to which the compensation should be increased needs to be determined
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Arguments
- Learned Senior Counsel argued for a uniform rate of compensation for the entire acquisition rather than individual rates for different parcels of land.
- Highlighted the overall development of the Township in the National Capital Region.
- Contended that landowners cannot invoke Section 28A of the 1894 Act for re-determination of market value as it is restricted to compensation determined by the Reference Court.
- Opposed the Miscellaneous Applications seeking to rely on Bir Singh (supra) for recalling orders dismissing the SLPs, stating they were not maintainable due to lack of invoking review jurisdiction in a timely manner.
- Pointed out that sale deeds produced by landowners were for abadi land while agricultural or non-abadi land was acquired in the present case.
- Emphasized that the compensation cannot be fixed at current market value due to planned development in neighboring areas post-acquisition.
- Highlighted significant delays and argued against enhancing compensation due to subsequent allocation of land to third parties without binding contracts for recovery.
- Cited that circle rates might not reflect the correct market value of the acquired land and that major developmental works are necessary before non-agricultural use can be made.
- Stressed that only a limited percentage of the acquired land can be utilized for industrial or institutional purposes after necessary development works.
- The acquired land in Sector 18 was acquired in 1976 for INR 7,200 to INR 10,200 per bigha.
- The land was in a developed area near Amity Public School, a Golf Course, Film City, and residential and shopping areas.
- Review and Curative Petitions had been filed and dismissed earlier in many SLPs related to the acquired land.
- The acquired land in NOIDA is close to DSC Shade, Okhla Barrage Highway, and MAT Public School of Business Management.
- A small piece of land sale deed dated 22.02.1989 was highlighted, stating its relevance should not be undermined.
- Reference Court’s order, based on a sale deed of 400 sq. yds., was pointed out by NOIDA authorities.
- Landowners sought compensation not less than the rate awarded in Bir Singh, stating a factual error in the decision.
- Evidence was presented for parity in compensation rates based on the sale exemplar dated 22.02.1989.
- Proximity to parts of Delhi, including Connaught Place, Nehru Place, the Supreme Court, and ITO, was emphasized.
- Dispute regarding the sale deed being within abadi land was raised by the Learned Senior Counsels representing landowners.
- Circle rate was considered crucial for determining market value, invoking Section 28A of the 1894 Act.
- Leased plots in NOIDA were mentioned, one for INR 11,576 per sq. yd. and another for INR 22,125 per sq. yd., on specific dates in 1988.
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Analysis
- Factors such as economic recessions, political instability, speculative investments or real estate crisis can impact the perceived value of the land.
- The landowners are entitled to the revised rate of INR 403 per sq. yd. for their acquired land due to the lack of multiple sale instances.
- The sale deed dated 22.02.1989, being the sole example used, is inadequate and introduces risk and imprecision in assessing land values.
- Section 23(1) of the 1894 Act is crucial in determining compensation for acquired land.
- A proposed 15% escalation for one year from the released rates by NOIDA in 1989 brings the total guesstimated price to Rs. 403 per sq. yd.
- The principle of guesstimation, as seen in Krishan Kumar v. Union of India, is applied to estimate compensation.
- The potential future commercial development of the acquired land is evident based on its strategic location and surrounding landmarks.
- Land valuation is an exercise of informed estimation, considering various factors and professional judgment.
- The size and nature of the acquired land differ significantly from the cited sale exemplar, highlighting the need for adjustments in valuation.
- The market value of land is subject to various factors like location, market conditions, and potential uses.
- The concept of ‘market value’ under the 1894 Act relies on open market transactions between willing buyers and sellers.
- Criteria for using sale deeds in land valuation include genuineness, proximity to Section 4 notifications, and similarity to acquired land.
- The reliance on a single sale deed of significantly smaller size for valuation purposes requires adjustments based on land potentiality for residential use.
- Guesstimation is used as a tool for estimating market value and compensation in the absence of direct evidence and comparable sale exemplars.
- Various factors like land characteristics, surrounding developments, and market sentiments influence land valuation.
- Section 28A of the 1894 Act serves to prevent discrimination in compensation among affected parties.
- The commercial potentiality of acquired land is influenced by its characteristics, potential uses, and market sentiments.
- Consideration of multiple factors and evidence is crucial in determining fair and just compensation for expropriated land.
- The principle of guesstimation must be applied reasonably and based on available data to estimate land value and compensation effectively.
- Decision not to delve into landowners’ prayer for parity based on Section 28A of the 1894 Act in line with Bir Singh judgement due to unique facts
- Bir Singh judgement not binding due to specific circumstances
- Lack of compliance with procedural requirements by the landowners regarding Section 28A
- Issue of parity based on Section 28A rendered academic as compensation rate revised for all landowners
- Uniformity in compensation already granted to all landowners on different grounds, making plea under Article 14 of the Constitution academic
Decision
- Landowners’ appeals allowed in part
- NOIDA authorities’ appeals allowed in part
- Rate of compensation enhanced from INR 340 per sq. yd. to INR 403 per sq. yd.
- High Court’s compensation rate reduced from INR 449 per sq. yd. to INR 403 per sq. yd.
- Enhanced compensation amount to be deposited with the Reference Court within eight weeks
- Disbursement of compensation to claimants to be done at the earliest
Case Title: NEW OKHLA INDUSTRIAL DEVELOPMENT AUTHORITY Vs. HARNAND SINGH (DECEASED) THR. LRS. (2024 INSC 509)
Case Number: C.A. No.-003674-003675 – 2023
