HON'BLE SRI JUSTICE G.CHANDRAIAH
&
HON’BLE SRI JUSTICE M.S.K. JAISWAL
L.A.A.S. No. 1940 of 2005
DATE: 27.11.2014
Between:-
Govt. of A.P. through The Special Dy. Collector .. Appellant/ and
1. M/s.Greeves Limited
2. M/s.Yamuna Digital Electronics
3. V.Ravinder Reddy .. Respondents-
Claimants
JUDGMENT:- (per Hon’ble Sri Justice G. Chandraiah)
This appeal under Section 54 of the Land Acquisition Act, 1894 (for brevity “the Act”) is directed against the order dated 05.11.2005 passed in O.P.No. 17 of 1997 by the learned Senior Civil Judge at Sangareddy, Medak District.
The admitted facts of the case are that the Government of A.P. by issuing Notification dated 02.09.1976 under Section 4(1) of the Act acquired the lands belonging to the claimants to an extent of Ac.4.04 guntas in Sy.No.449 and Ac.5.16 guntas in Sy.No.450 situated in Patancheru for the purpose of developing them into an industrial area Phase-III invoking urgency provisions of the Act and took possession of the lands on 29.11.1977. During the course of Award enquiry, Notices under Sections 9(3) and 10 of the Act were issued to the claimants. While so, on 04.01.1995, claimant Nos.1 and 2 claimed Rs.1,50,000/- per acre, besides the statutory benefits, such as Rs.50,000/- towards construction of culvert, Rs.60,000/- towards levelling of bore-well, Rs.30,000/- towards digging of bore-well, Rs.20,000/-
towards construction of roads and Rs.75,000/- towards basement for the factory building i.e. a total of Rs.2,35,000/-. On 15.04.1995, the Land Acquisition Officer completed the award enquiry. The Revenue Divisional Officer-cum-Land Acquisition Officer, Sangareddy passed an award dated 18.09.1986 in respect of the lands in an extent of Ac.0.24 guntas in Sy.No.449 and Ac.0.11 guntas in Sy.No.450 which were acquired for the purpose of laying railway line from Tellapur to Patancheru and these lands are part and parcel of the lands acquired for establishment of industrial area, and awarded Rs.5,500/- per acre and rejected the claim in respect of superstructures made over the acquired property on the ground that such structures were not found by the date of taking possession of the acquired property on 29.11.1977. For the remaining land which was acquired for the purpose of establishment of industrial area, the Land Acquisition Officer simply adopted the said award and fixed the market value at Rs.5,500/- per acre. Thereafter, the claimants sought reference under Section 18 of the Act seeking enhancement of the market value of the lands acquired for laying railway line from Tellapur to Patancheru and the District Court, by Common Order dated 03.11.1987 in O.P.Nos.270 to 272 of 1987 enhanced the compensation to Rs.59.50 per square yard. The Land Acquisition Officer has excluded the said area of land from the award enquiry. Subsequently, the Government preferred an appeal against the Common Order dated 03.11.1987, but it was dismissed by this Court. According to claimant Nos.2 and 3, the acquired land is situated between the industries, residential colonies and the railway station of Patancheru. Thereafter, the claimants sought reference under Section 18 of the Act seeking enhancement of the market value of the lands acquired viz. Ac.4.04 guntas in Sy.No.449 and Ac.5.16 guntas in Sy.No.450 for establishment of industrial area at Phase-III situated at Patancheru excluding the land in extents of Ac.0.24 guntas in Sy.No.449 and Ac.0.11 guntas in Sy.No.450, and also costs of the superstructures together with all statutory benefits. The learned Senior Civil Judge, at Sangareddy, Medak District, vide order dated 15.11.2005 in O.P.No.17 of 1997, fixed the market value at Rs.55.50 per square yard by reducing the value at 1% per each year and awarded 30% solatium on the market value and 12% additional market value from the date of Notification to the date of delivery of possession and 9% interest per annum for the first year from the date of taking possession and 15% interest per annum thereafter. Being aggrieved by the order dated 15.11.2005, the Land Acquisition Officer has filed the present appeal.
The main contention of the learned Government Pleader for Appeals appearing for the appellant is that even though there is no dispute with regard to the fixation of market value but the reduction at the rate of 1% per each year by the Reference Court is not proper and it should be at least 10% per each year for a period of five years on the ground that there was a gap of four years between the acquisition of lands relating to O.P.No.17 of 1997 and the lands acquired in 1981 which relate to O.P.Nos.270 to 272 of 1987. The learned trial Court has failed to apply legal method of reduction of value at the rate of 10% rather than 1% towards de-escalation. He further submits that the reduction of 10% is justifiable towards de-escalation rather than 1% as held by the trial Court.
On the other hand, the learned counsel for the respondent-claimants submits that during the period when the lands were acquired for the purpose of establishment of industrial area, there was meager value and the trial Court, taking into consideration one of the awards passed by the Land Acquisition Officer in O.P.Nos.272 of 1987 and batch under Ex.A1 which was confirmed by this Court in A.S.No.2557 of 1989 and batch and the facts and circumstances of the case, passed the well-reasoned order impugned in the present appeal. In support of the contentions, both the learned counsel have relied upon
[1]
the judgment reported in Chandrashekar v. L.A.O. on different paragraphs. The learned counsel for the claimants has further contended that the purpose of acquisition of the lands is for laying railway line in respect of O.P.Nos. 270 to 272 of 1987 which has no connection or relevancy to the purpose of acquisition of the lands meant for establishment of industrial area in respect of O.P.No.17 of 1997, as such, the enhancement made in O.P.Nos.270 to 272 of 1987 can be taken as precedent for fixing market value for the lands relating to O.P.No. 17 of 1997, and prays to confirm the order dated 05.04.2005. He further submits that the land in question is situated at a far away place from the city and no developments were made in 1977, therefore, the reduction of 1% towards de- escalation by the trial Court is proper and no further de- escalation is needed for the lands acquired for the purpose of establishment of industrial area.
Heard the learned Government Pleader for Appeals and the learned counsel for the respondents-claimants and perused the material placed on record.
The point that falls for consideration is whether the judgment rendered by the trial Court in O.P.No.17 of 1997 suffers from any legal infirmities?
As could be seen from the order under appeal, M.Lakshminarasaiah, who is the Director of the claimant No.1 – company, is examined as PW1. He admitted in his cross-examination that they have not filed any documents to show the existence of culvert, bore-well, casement of factory building and roads by the date of taking possession of the land relating to O.P.No.17 of 1997 and making award enquiry. He denied a suggestion that subsequent to the award enquiry and taking possession of the land on 29.11.1977, they made constructions in the lands. PW2, who is the Senior Branch Manager of Claimant No.1, admitted a suggestion in his cross- examination that they have not made any claim for the superstructures made on the acquired land. RW1, who is examined on behalf of the Government, stated in his chief-affidavit that the superstructures viz. culvert, bore- well, roads and basement of the factory building were not in existence either on the date of issuance of Notification i.e. 02.09.1976 or on the date of taking possession of the land i.e. 29.11.1977.
So far as the claim made by the claimants in respect of the super-structures on the acquired lands is concerned, the evidence on record shows that those structures appear to have been raised subsequent to the date of taking possession of the acquired land.
The learned Government Pleader submits that the purpose of acquisition of the land in O.P.No.270 of 1987 and batch is quite different from that of the land acquired in the present case, and therefore, the claimants cannot be awarded compensation of Rs.55.50 per square yard.
The trial Court, while passing the order under appeal observed that the land acquired for laying the railway line is part and parcel of the lands situated in Sy.Nos.449 and 450 and similar in nature to the land acquired for establishment of industrial area, however the possession of the land for establishment of industrial area relating to O.P.No.17 of 1997 was made in 1977 whereas the acquisition of the land for laying railway line relating to O.P.Nos.270 to 272 of 1987 was made in 1981. From this, it is clear that the acquisition of the land relating to O.P.No. 17 of 1997 was made four year prior to the acquisition of the land relating to O.P.Nos.270 to 272 of 1987, as such, the trial Court fixed the market value at Rs.55.50 per square yard by reducing it by 1% per each year together with all statutory benefits. The fixation of market value by the trial Court is based on proper verification of the record and consideration of oral and documentary evidence particularly Exs.A1 and A2.
That apart, the Apex Court, considering various case laws on the subject while rendering its judgment cited supra, observing that though the reduction cannot be static but depends on facts and circumstances of each case, held as under:
“The High Court while determining the compensation payable to the appellants on the basis of the sale deed dated 30.12.1983 applied a further deduction of 10% under the head of “de-escalation”. The contention advanced at the hands of the learned counsel for the appellants was that the Reference Court had awarded a deduction at the rate of 3% per annum, but the same was arbitrarily increased to 10% by the High Court, without recording any reasons for the same. It was submitted that deduction at the rate of 10% on account of de-escalation was arbitrary, and was liable to be set aside.
Insofar as the contention advanced at the hands of the learned counsel for the appellants on the issue of deduction under the head of “de-escalation” is concerned, reference may be made to the decision rendered by this Court in DDA v. Bali Ram Sharma [(2004) 6 SCC 533)], wherein this Court found it appropriate to allow annual escalation, at the rate of 10%, in order to determine the market value of the acquired land. In ONGC Ltd v. Rameshbhai Jivanbhai Patel [(2008) 14 SCC 745)], this Court held that provision of 7.5% per annum towards escalation of land costs, was appropriate to arrive at the market value of the acquired land. In Valliyammal v. Tahsildar (LA) [(2011) 8 SCC 91)], this Court was of the view that 10% per annum escalation in price, should be added to the specified price to determine the market value. It is, therefore, apparent that escalation in the market value has been determined by this Court at percentages ranging between 7.5% per annum to 10% per annum.
Even though escalation of market price of land is a question of fact, which should ordinarily be proved through cogent evidence yet, keeping in mind ground realities, and taking judicial notice thereof, we are of the view that land prices are on the rise throughout the country. The outskirts of Gulbarga Town are certainly not an exception to the rule. The exemplar sale deed dated 30.12.1983 was executed exactly 1 year 7 months and 17 days after the publication of the preliminary Notification on 13.05.1982. Keeping in mind the judgments referred to hereinabove, we are of the view that no fault can be found with the determination rendered by the High Court in making a deduction of 10% under the head of “de-escalation”, specially when the period in question exceeded one year (as for annual deductions), by 7 months and 17 days.”
In the instant case, the dispute is not with regard to the fixation of market value in respect of the land acquired but only with regard to the reduction of 1% per year towards de-escalation. As could be seen from the judgment of the Apex Court, different percentages were fixed even ranging from 3% to 10%. In the instant case, as is evident from the judgment of trial Court, Patancheru is an area which is situated in the midst of industries and the residential colonies and railway station.
In view of the proposition of the law laid down by the Apex Court, and having regard to the facts and circumstances of the case, we feel that it is just and proper to fix de-escalation at the rate of 5% per each year together with 30% solatium on the market value and 12% additional market value from the date of Notification to the date of delivery of possession and 9% interest per annum for the first year from the date of taking possession and 15% interest per annum thereafter.
With the above modification of the order under appeal, this appeal is disposed of. No order as to costs.
As a sequel to the disposal of the Land Acquisition Appeal, miscellaneous petitions, if any pending, shall stand disposed of as infructuous.
G. CHANDRAIAH, J 27.11.2014 bcj M.S.K. JAISWAL, J
[1] (2012) 1 Supreme Court Cases 390