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Reportable

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL No. 5768 OF 2006

K. Devakimma & Ors. Appellant(s)

VERSUS

Tirumala Tirupati Devasthanams & Anr.       Respondent(s)

WITH

                CIVIL APPEAL No. 5769 of 2006

P. Sreenivasulu Naidu Appellant(s)

VERSUS

Special Deputy Collector,  Tirupathi & Anr.       Respondent(s)

     AND

CIVIL APPEAL No. 5770 of 2006

R.N. Rangamma Appellant(s)

VERSUS

Tirumala Tirupati Devasthanams & Anr.       Respondent(s)

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J U D G M E N T

Abhay Manohar Sapre, J.

1. These  appeals  are  filed  against  the  common

judgment  and  order  dated  05.07.2004  passed  by

the  High Court  of  Judicature,  Andhra  Pradesh at

Hyderabad in Appeal  No.  120 of  2001 with Cross

Objection(SR) No. 17190 of 2001, Appeal No. 1778

of  2001  with  Cross  Objection(SR)  No.  65760  of

2001, Appeal No. 1808 of 2001, Appeal No. 1927 of

2001 with Cross Objection(SR) No. 66074 of 2001,

Appeal No. 2421 of 2001 with Cross Objection(SR)

No. 82152 of 2001, Appeal No. 1975 of 2002, Appeal

No. 1411 of 2003, Appeal No. 2304 of 2002, Appeal

No. 155 of 2003 and Appeal No. 1279 of 1999 with

Cross Objection(SR) No. 87947 of 1999, Appeal No.

67  of  2001,  Appeal  No.  726  of  2001,  Appeal  No.

1849 of 2001, Appeal No. 2031 of 2001, Appeal No.

1304 of 2001 and Appeal No. 1145 of 2003.    

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2. By  impugned  judgment/order,  the  Division

Bench of  the  High Court,  partly  allowed the  first

appeals filed by the respondents herein and reduced

the  rate  of  compensation  payable  to  the

claimants/landowners  (appellants  herein)  at

Rs.30/-  per  square  feet,  which  was  fixed  by  the

Reference  Court  (Civil  Court)  between  Rs.80/-  to

Rs.100/- per square feet for the land acquired by

the  State  under  the  Land  Acquisition  Act,  1894

(hereinafter  referred  to  as  "The  Act”).  Dissatisfied

with the judgment/order passed by the High Court,

the claimants/land-owners have filed these appeals

for enhancement of the compensation.

3. The question that  arises for  consideration in

these  appeals  is  whether  the  High  Court  was

justified in partly allowing the appeals filed by the

respondents  herein  by  reducing  compensation  at

the  rate  of  Rs.30/-  per  square  feet  for  the  land

which was acquired by the State or the rate should

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have been more than Rs.30/- and, if so, how much,

i.e.,  the  one  determined  by  the  Reference  Court

(Civil  Court)  between  Rs.80/-  to  Rs.100/-   per

square feet or it should be more than that?

4. In order to appreciate the controversy involved

in these appeals, it is necessary to state the relevant

facts  infra.  For  the  sake of  convenience,  we shall

first advert to the factual matrix of C.A. No. 5769 of

2006  (P.  Sreenivassulu  Naidu  vs.  The  Special

Deputy  Collector,  Land  Acquisition  Officer,  TTD,

Tirupathi & Anr.)

5. The appellant in C.A. No.5769 of 2006 is the

owner of  the land measuring 4176 square feet  as

per the State whereas 5220 square feet as per the

appellant.   This  land is  situated in  T.S.  No 40/2

Ward No.3,  Block E in village Tirumala.  Likewise,

the appellants in other two appeals are also owners

of  the  similar  land  as  described  in  the  memo of

appeals.   The  appellants  were  having  their  small

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shops  and  hutments  on  their  land  wherein  they

used  to  carry  on  their  small  business  for  their

livelihood.

6. In  exercise  of  the  powers  conferred  under

Section 4 of the Act, the State Government issued a

notification  on  15.01.1987  and  acquired  the

appellant's aforementioned land along with the land

of other landowners alike the appellant situated in

the  same  area.   The  land  was  acquired  for  the

benefit of the Tirumala Tirupati Devasthanams (in

short  “the TTD”)  to enable  them to develop Balaji

temple  town  by  constructing  roads,

Kalyanamandapam,  Choutries  and  for  providing

other civic amenities in the town for the benefit of

large  number  of  devotees,  who  regularly  visit  the

temple for having darshan of Lord Balaji.  

7. In  other  appeals,  similar  notifications  under

Section 4 were issued by the State on 19.06.1985,

23.12.1985,  26.05.1986,  29.08.1986,  25.05.1987,

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05.08.1987,  21.08.1989  and  26.10.1992  for

accomplishing the same public  purpose.  By these

notifications, a large chunk of land was acquired in

the same area where the land of  the appellant  in

C.A. 5769 of 2006 was situated. So far as the land

belonging to the present appellants was concerned,

it was of small dimension.   

8. Notification under  Section 4 was followed by

the declaration under Section 6 of the Act published

on  05.08.1987  and  likewise  it  was  published  on

other dates in relation to notifications issued under

Section 4 of the Act for adjacent lands.  

9. This  led  to  initiation  of  the  proceedings  for

determination  of  compensation  payable  to  each

landowner including that of the appellants herein by

the  Land  Acquisition  Officer  (in  short  'the  LAO’).

Notices under Section 9 of the Act were issued to

the appellants calling upon them to participate in

the land acquisition proceedings to enable the LAO

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to determine the fair market value of the land on the

date of acquisition as provided under Section 23 of

the Act so that compensation would be paid to the

landowners  at  such  determined  rate.  Accordingly,

the  LAO  held  an  enquiry  and  after  affording  an

opportunity  to  the  appellants  herein  passed  an

award on 12.03.1991 and also on different dates as

mentioned in the memo of appeals fixing the market

value  of  the  acquired land at  Rs.11/-  per  square

feet. So far as the structure built by the appellant in

C.A. No. 5769 of 2006 on the land in question was

concerned, it was valued at Rs.45,936/-.  The LAO,

therefore,  fixed  Rs.11/-  per  square  feet  as  the

uniform  rate  for  awarding  compensation  for  the

land  to  all  the  landowners.  So  far  as  the

compensation for built-up structure on the land of

individual  landowners  was concerned,  it  varied in

cases of individual landowner and was accordingly

calculated  on  the  basis  of  extent  and  quality  of

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construction  made  by  each  landowner.  The

appellants were, accordingly, paid the compensation

for their land and super-structure standing on their

land  in  addition  to  other  statutory  compensation

such as solatium, interest  etc.  payable  under  the

Act.     

10. Feeling aggrieved by the award, the appellants

in all the appeals sought reference to the Civil Court

under Section 18 of the Act for re-determination of

the compensation made by the LAO. The reference

Court, on the basis of the evidence adduced, partly

answered the reference in favour of the appellants

by  award  dated  15.07.2002  and  accordingly

enhanced  the  rate  of  the  compensation  from

Rs.11/- per Square feet to Rs.86/- per square feet.

In other  words,  the reference Court held that  the

appellant was entitled to get compensation for his

land at the rate of Rs.86/- per square feet being the

fair  market  value  of  his  land  on  the  date  of

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notification issued under Section 4 of the Act.  In

other  two appeals,  the reference Court by awards

passed  on  different  dates  enhanced  the

compensation  and  fixed  it  between  Rs.80/-  to

Rs.100/- per square feet.  

11. Challenging the legality and correctness of the

awards of the Reference Court, the TTD, for whose

benefit the land was acquired, filed appeals before

the High Court under Section 54 of the Act.  So far

as the appellants (landowners) were concerned, they

filed cross-objections and prayed for enhancement

in  the  compensation  at  the  rate  of  Rs.150/-  per

square  feet  as  against  Rs.80/-  to  Rs.100/-  per

square feet awarded by the Reference Court.

12. The  Division  Bench  of  the  High  Court,  by

common impugned judgment/order  partly  allowed

the  appeals  filed  by  TTD (respondent  herein)  and

reduced the compensation payable to the appellants

to Rs.30/- per square feet. In other words, in the

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opinion of the High Court, the Reference Court was

not right in determining the compensation payable

between Rs.80/- to Rs.100/- per square feet instead

it should have been paid at the rate of Rs.30/- per

square  feet  uniformly  to  all  the  landowners

(appellants).  In this way, the appellants were held

entitled to get the compensation at the uniform rate

of Rs.30/- per square feet for their respective lands.

As a consequence, the cross objections filed by the

appellants herein (landowners) for enhancement of

the compensation at Rs.150/- per square feet were

dismissed.  Against  this  judgment/order,  the

claimants/landowners  have filed these appeals  by

way of special leave petitions.  

13. Heard  learned Counsel for the parties.

14. Mr.  B.  Adinarayana  Rao,  learned  senior

counsel  appearing  for  the  appellants  in  C.A.  No.

5769 of 2006 contended that the High Court erred

in  partly  allowing  the  appeals  filed  by  the  TTD.

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According to the learned counsel, no case was made

out  by  the  TTD  either  on  facts  or  in  law  for

reduction of rate of compensation, which was rightly

fixed  by  the  Reference  Court  between  Rs.80/-  to

Rs.100/-  per  square  feet.  He  submitted  that  the

Reference  Court  had  rightly  appreciated  the

evidence  on  record  for  enhancing  the  rate  of

compensation  and  on  such  appreciation  itself,  it

could  have  awarded  still  higher  than  what  was

awarded but in no case it could have been less than

the same as was done by the High Court, which has

no basis. Learned counsel further pointed out that

apart  from  the  evidence  adduced  by  the

claimants-appellants  herein  before  the  Reference

Court  to  prove the  fair  market  value  of  the  land,

even the counsel  appearing for  TTD did not  raise

any objection for payment of  compensation at the

rate  of  Rs.90/- per  square feet.   Learned counsel

also pointed out that by virtue of ban contained in

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Section  123  of  the  Andhra  Pradesh  Charitable  &

Hindu  Religious  Institutions  &  Endowments  Act

1987  (for  short  ‘the  AP  Act’)  for  sale  of  the  land

situated in Tirumala Hills, it was not possible to any

person to sell his land privately and it was for this

reason, the appellants were not able to file copies of

any sale deeds of the lands which did not take place

between the two private parties except one or two.

This aspect, according to the learned counsel, was

rightly taken note of by the Reference Court while

determining the value of  the land but was not so

taken note of in its proper perspective by the High

Court  resulting  in  committing  an  error  while

determining the value of the land.  Learned counsel,

therefore, contended that this Court should restore

the award of Reference Court.

15. Learned counsel for the appellants in other two

appeals adopted the arguments of Mr. Adinarayana

Rao.

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16. In contra, Mr. G. Prabhakar, learned counsel

for  the respondent (TTD) supported the impugned

judgment and contended that no case is made out

on facts or/and in law to call for any interference in

the  impugned  judgment  of  the  High  Court.  This

submission was elaborated by the learned counsel

by  referring  to  the  reasoning  contained  in  the

impugned judgment.

17. Having heard learned counsel  for  the parties

and on perusal  of  the record of  the case, we find

force in  the submission of  learned senior  counsel

appearing  for  the  appellants  (land-owners)  and

hence are inclined to allow these appeals in part by

restoring the award of the Reference Court with part

modification  as  detailed  infra  by  enhancing  the

compensation.

18.  In our considered opinion, the reasoning and

the  conclusion  arrived  at  by  the  Reference  Court

(civil  court)  while  fixing  the  rate  of  compensation

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between Rs.80 to Rs.100/- per square feet for the

land in question was just and proper and hence the

same should not have been disturbed by the High

Court in appeals filed by the TTD for reducing the

rate to Rs.30/- per square feet. In other words, in

our considered view, if the reference Court was right

in fixing the rate of compensation between Rs.80 to

Rs.100/- per square feet for the entire acquired land

in  question,  the  High  Court  was  not  right  in

interfering with this finding of the Reference Court

and reducing it to Rs.30/- per square feet.  This we

say so for the following reasons.

19. In order to prove the market rate of the land in

question,  the  appellants-landowners  had  adduced

evidence by filing certified copies of sale deeds and

several awards passed by the Reference Court (Civil

Court) wherein the Reference Court had determined

the fair market value of the adjacent similar lands

which  were  acquired  prior  to  acquisition  of  the

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lands  in  question.   Exs.B-7,  8,  9,  10  and  11

(marked in Award No.46/90-91)  are  the  copies of

the orders/awards passed by the Reference Court in

relation  to  the  lands  which  were  acquired  in  the

years 1957, 1962 and 1976. The rate fixed by the

Reference Court for the lands acquired in the year

1957 was at Rs.30/- per square feet. Likewise the

rate fixed for the land acquired in the year 1962 was

at  Rs.40/-  per  square  feet  and  for  the  lands

acquired in the year 1976, the rate was at Rs.73/-

per square feet.Exs. B-12, 13 and 15 are the copies

of the orders/awards passed by the Reference Court

in relation to the lands acquired in 1986 and 1987.

The rate fixed for the land acquired in the year 1986

was at  Rs.100/- per square feet  and for  the land

acquired in the year 1987, the rate was Rs.106/-

per square feet.  

20. It  is  not  in  dispute  that  so  far  as  the

orders/awards (Exs. B-7 to B-11) were concerned, it

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pertained to lands adjacent to the lands in question

and  had  attained  finality  whereas  the

orders/awards  (Exs.B-12,13  and  15)  were  sub

judiced in pending appeal.

21. The  Reference  Court,  therefore,  took  into

consideration  the  rates  of  lands  prevailing  in  the

years  1957,  1962  and  1976  (without  taking  into

account  the  rates  of  lands prevalent  in  the  years

1986 and 1987 though they related to lands sold in

near  proximity  with  acquisition  of  the  lands  in

question  on  the  ground  that  the  appeals  were

pending  in  relation  to  these  lands  against  the

orders/awards)  and  then  taking  into  account  the

appreciation in the value of land in the last 25 years

at Rs.3/- per square feet per annum fixed the fair

market value of land in question between Rs.80 to

Rs.100/- per square feet.  

22. It  is  pertinent  to  mention  that  the  learned

counsel  appearing  for  the  TTD  had  given  his  no

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objection to the rate fixed by the Reference Court

which was duly recorded by the Court in Para 8 of

the award dated 14.3.2001 (Award No.46/90-91). It

reads as under:

“8.  The  advocate  for  the  claimants  argued that the market value of the site at Tirumala during 1962 was Rs.40/- per sq. foot as per Ex.B-3  and  since  the  site  in  question  is acquired in 1987, i.e., 25 years after the land acquisition  covered  by  Ex.B-3,  the  market value of the site acquired in this case can be fixed  more  than  Rs.100/-  per  sq.  foot  by considering the appreciation in the value of the site since 25 years at Rs.3/- per sq. foot per annum.  The advocate for R.2/Beneficiary argued that in similar cases, this court fixed the market value of the site at Rs.90/- per sq.  foot and he has no objection to fix the same market value at Rs.90/- per sq. foot for the site acquired in this case……..”

   (Emphasis supplied)

23. The High Court, however, while reversing the

aforesaid view of the Reference Court held that the

Reference  Court  erred  in  relying  upon  the

orders/awards  passed  in  other  cases  for

determining the value of the lands in question.  The

High Court  then went on to the extent  of  finding

fault in the orders/awards.  The High Court also did

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not agree with the Reference Court to hold that the

prices of the land escalate in passage of time every

year though  it held that the Tirupati (Tirumala) has

acquired potential due to pilgrimage. It is apposite

to state what the High Court held on this issue:

“As observed  above,  the  very  basis  in determining the market value of the land by the reference courts is erroneous in law and is  contrary  to  the  settled  principles. Reference  Courts  have  proceeded  in  the matter assuming abnormal rise in prices and erroneously  placed  reliance  upon  the judgments  in  P.P.  No.34  of  1964  or  O.P. No.23  of  1969  and  batch.   Reliance  was placed erroneously on the alleged statement of LAO made in O.P. No. 30 of 1982.  There was  no  evidence  adduced  by  the  claimants evidencing any escalation in price from 1957 till respective dates of acquisition.  Evidence on record,  as discussed above, suggest that prices  have  remained  static  at  Tirumala irrespective of the place gaining considerable importance  or  the  place  being  visited  by innumerable pilgrims.  Pilgrims visit the Holy Place only for the purpose to have darshan of the deity and not with a view to settle there. No evidence is left in to show that there was heavy  demand  for  land  in  the  area. Therefore, there was no justification on the part  of  the  Reference  Courts  in  fixing  the market  value  on  the  basis  of  the  market value fixed in the earlier judgments.  May be that in one case, i.e., in O.P. No.23 of 1969 and batch appeals were filed and there was no interference by this Court in the assessment of the market value, but, that alone could not have been made the basis for arriving at the market  value  in  these  cases.   There  was

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absolutely no evidence to have proceeded to fix  the  market  value  more  than  what  was offered  by  the  LAO.   Considering  the  facts and circumstances of the case and fixing the market  value  at  Rs.23/-  per  sq.  ft.  we  are inclined to take in all cases the market value of the land at Rs.30/- per sq. ft. which would be just, fair and equitable and to that extent the respective awards of the reference courts deserve to be modified.”

24. We do not agree with the aforesaid finding of

the  High  Court  for  the  following  reasons  detailed

infra.

25. As  mentioned  above,  the  reasoning  of  the

Reference Court is in conformity with the principle

of law laid down by this Court wherein this Court

has in no uncertain held that recourse can be taken

in appropriate cases to the mode of determining the

market  value  of  the  acquired  land  by  providing

appropriate escalation over the proved market value

of nearby lands in previous years where there is no

evidence of any contemporaneous sale transactions

or acquisition of comparable lands in neighborhood.

The percentage of escalation may vary from case to

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case so also the extent  of  years to  determine the

rates  (see  General  Manager,  Oil  &  Natural  Gas

Corporation Ltd. Vs. Rameshbhai Jivanbhai Patel

& Anr., (2008) 14 SCC 745 & Valliyammal & Anr.

Vs. Special Tahsildar (Land Acquisition) & Anr.,

(2011) 8 SCC 91).

26. We  find  that  the  Reference  Court,  therefore,

rightly  relied  on  the  rates  determined  by  it  in

relation to adjacent lands and applied the principle

of giving escalation to the rates determined yearly

and worked out the rates between 80/- to 100/- per

square feet.  It  was not  in dispute that  the public

purpose for acquisition of both the lands was the

same and secondly, all these lands were in the close

proximity  with  each  other  being  situated  in

Tirumala.  

27. The  High  Court  having  rightly  held  that  the

Tirumala  Tirupati  Devasthanam  has  acquired

immense potential  due to  its  pilgrimage status in

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the  country  was  not  right  in  holding  that  its

potentiality cannot be taken into consideration for

holding that the prices of the land are also escalated

due  to  such  reason.  As  held  by  this  Court  in

O.N.G.C.  and  Valliyammal’s  cases  (supra),  the

escalation in price of the land which depends upon

the nature of land and its surrounding, its benefit

should have given for determining the price of the

land in question by taking into account the rate of

land fixed by the Reference Court in relation to land

acquired in past years as was rightly done by the

Reference Court. It was all the more because no sale

deeds were available for filing due to peculiar reason

that there was a statutory ban imposed by Section

123 of the A.P. Act for sale of private land in the

area in question. It was for this reason, no private

sale had taken place of  any parcel  of  land at the

relevant time barring one or two. Similarly, the High

Court  further  erred  in  finding  fault  in  the

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orders/awards which were rightly relied on by the

Reference Court. The High Court failed to see that

they  were  not  hearing  the  appeals  arising  out  of

those  orders/awards  to  examine  their  legality

or/and  correctness  which  had  become  final  and

were  also  given  effect  to.   The  High  Court  was

required to see as to  whether the land involved in

those cases was similar to the one which was the

subject matter of present proceedings and secondly,

what  was the  rate  fixed therein  by  the  Reference

Court for the lands.  

28. The  appellants  (landowners)  were,  therefore,

justified in filing the copies of orders/awards passed

in  relation  to  the  adjacent  lands  for  proving  the

market  rate  of  the  land  in  question  because  as

mentioned above, these lands were situated in the

same area nearer to the lands in question and were

also acquired for the same public purpose.

29. In the light of foregoing discussion, we are of

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the  considered  opinion  that  the  rate  fixed  by  the

Reference  Court  between Rs.80/- to  Rs.100/- per

square feet for the lands in question was just and

proper  and the  High Court  erred in  reducing  the

same to Rs.30/- per square feet.

30. We are, however, of the view that the Reference

Court having held that the appellants were entitled

to  compensation  at  the  rate  varying  between

Rs.80/-  to  Rs.100/-  per  square  feet,  should  have

fixed  one  uniform  rate  for  the  entire  land  rather

than to fix different rates such as Rs.80/-, Rs.86/-,

Rs.90/- and Rs.100/- per square feet for different

landowners.  In our view, since the land of all the

appellants was more or less similar in nature and

no evidence was adduced by the appellants to prove

any  significant  improvement/addition

or/dissimilarity  in  the  land  or  its  quality,  the

Reference Court should have fixed one uniform rate.

31. Having  regard  to  the  totality  of  factual

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undisputed scenario  which has emerged from the

evidence and taking into account the extent of the

land  held  by  each  landowner,  we  are  of  the

considered opinion that the appellants are entitled

to get the compensation for their respective lands at

the rate of  “Rs.90 per square feet”.  So far as the

compensation awarded by the Reference Court for

super-structure  built  on  each  appellant’s  land  is

concerned, it does not call for any interference.  In

our view, it was rightly upheld by the High Court

and  we  also  uphold  the  same,  calling  no

interference.

32. Learned  senior  counsel  for  the  appellants

(landowners) then submitted that the appellants are

all  small  shopkeepers who were carrying  on their

small business for their livelihood but now due to

the acquisition, they are deprived of their land and

therefore  unable  to  do  their  business.  Learned

counsel, therefore, submitted that the TTD may be

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directed to provide any alternate space/shop/land

to the appellants herein in the nearby area on any

terms  and  conditions  which  will  enable  them  to

start business for their livelihood. Learned counsel

for the TTD has, however, opposed this prayer.

33. Having  taken  note  of  the  submission  of  the

learned counsel for the appellants, all that we wish

to observe is that in case if  any of the appellants

apply for allotment of any land/shop/space to TTD

for  doing  any  business  in  the  area  under  their

ownership or/and control then the TTD would be at

liberty  and  may  consider  their  case  for  providing

them a shop or land or space, as the case may be,

pursuant to any of their scheme, if any in force, on

suitable terms and conditions alike others as a fine

gesture on the part of the TTD, for compliance.  

34. We,  however,  make  it  clear  that  the

observations made in para 33 are only in the nature

of  observations  and  not  an  order/writ  issued

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against the TTD.  

35. In  view  of  foregoing  discussion,  the  appeals

succeed  and  are  allowed  in  part.  The  impugned

judgment/order of the High Court is set aside and

the  awards  passed  by  the  Reference  Court  (civil

court) are restored with the modification indicated

above.   The respondents  are  directed to  calculate

the  payment  of  compensation  payable  to  each

appellant (landowner) as directed above and pay the

compensation money to each of the appellant within

three months from the date of the receipt of copy of

this judgment.

                    …….….……............................J. [VIKRAMAJIT SEN]

                               …………..................................J.

[ABHAY MANOHAR SAPRE]

New Delhi; April 23, 2015.

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