Page 1

1

IN THE SUPREME COURT OF INDIA       CIVIL APPELLATE JURISDICTION

 CIVIL APPEAL Nos.7219-20 OF 2016    (Arising out of SLP(C)Nos.24895-24896 of 2013)

BHIKULAL KEDARMAL GOENKA (D) BY L.RS.             .......APPELLANTS

VERSUS

STATE OF MAHARASHTRA AND ANR                     .......RESPONDENTS                                                    

O R D E R

Leave granted. Two pieces of the appellant's (since deceased. and is now

represented by his legal representatives) land measuring 2250 and 5034  sq.meters  were  sought  to  be  compulsorily  acquired,  vide Notifications dated 30.10.1986 and 13.11.1986 respectively, issued under  Section  6  of  the  Land  Acquisition  Act,  1894  (hereinafter referred to as `the Act').  Admittedly, the purpose for which the land was acquired was to raise a structure for a primary school and to provide playgrounds therefor.  Vide awards dated 31.08.1987 and 09.11.1987,  the  Special  Land  Acquisition  Officer  determined  the market value of the land measuring 2250 sq.meters at Rs.110/- per

Page 2

2

sq.meter. For the land measuring 5034 sq.meters, the Special Land Acquisition Officer bifurcated the same. For the land adjoining the road, he awarded Rs.140/- per sq.meter, and for the remaining land situated away from the road, he awarded Rs.110/- per sq.meter.  In the  above  determination,  the  acquired  land  was  divided  into  18 plots, out of which six were awarded compensation at the rate of Rs.140/- per sq.meter, and the remaining at the rate of Rs.110/- per sq.meter.

Dissatisfied  with  the  determination  rendered  by  the Special  Land  Acquisition  Officer,  the  appellants  preferred reference under Section 18 of the Act seeking enhancement of the market value of the land.  The Reference Court, by a common order dated 25.01.1996, determined the market value of the acquired land at the rate of Rs.140/- per sq.meter.  However, for adjusting the value representing large areas of the plot, the Reference Court considered it appropriate to make a deduction of 1/3rd from the total amount calculated.

Still not satisfied with the compensation awarded, the appellant approached the High Court of Judicature at Bombay (Nagpur Bench,  Nagpur)(hereinafter  referred  to  as  `the  High  Court')  by preferring First Appeal Nos.638 and 639 of 1996. The same came to be disposed of by the impugned order dated 15.10.2012. The High Court, after examining the evidence recorded before the Reference Court,  arrived  at  the  conclusion,  that  the  lands  acquired  were situated  within  the  heart  of  the  town,  and  were  surrounded  by residential houses, commercial complexes etc. and major part of the area adjoined the Akola-Akot Road.  It is therefore, that the High

Page 3

3

Court  determined  the  market  value  at  Rs.200/-  per  sq.meter. However, the High Court directed deduction at the rate of 1/3rd towards  development  charges  and  thereupon,  arrived  at  the conclusion, that the market value payable ought to have been at the rate of Rs.133/- per sq.meter. The High Court rounded the rate determined, by awarding the appellants Rs.135/- per sq.meter.   

It was the vehement contention of the learned counsel for the appellants, that there was no justification whatsoever, for recording any deduction, specially when there was no question of any internal or external development, and as such, expenses of such developments should not have been taken into consideration so as to grant a deduction of 1/3rd of the amount.  In order to substantiate his  above  contention,  learned  counsel  for  the  appellants  has referred to the decision in Sabhia Mohammed Yusuf Abdul Hamid Mulla (Dead) by Lrs. and others vs. Special Land Acquisition Officer and others, (2012) 7 SCC 595, and placed reliance on the observations recorded  in  para  19  thereof.  Having  given  our  thoughtful consideration  to  the  position  expressed  in  paragraph  19,  it  is apparent, that while fixing the market value of the acquired land, which  may  be  undeveloped  or  underdeveloped,  the  courts  have approved deduction of 1/3rd of the market value towards development cost, “except when”, no development is required to be made for implementation of the public purpose for which land is acquired. Admittedly, the public purpose in the instant case is to raise a school and to provide for play-grounds, for the students to be enrolled in the school.   

Page 4

4

The factual position, we are satisfied is, that the land in question is located within the heart of the city, as is the case projected at the hands of the learned counsel for the appellants. The acquired land is to be used for raising a school building, and to  provide  play-grounds  therewith.  There  would  hardly  be  any requirement for development charges, in the peculiar facts of this case.  We are therefore satisfied, that the deduction of 1/3rd amount, expressed by the High Court, was wholly unjustified.   

However, we are unable to accept the determination of the High Court, that the compensation to be awarded to the appellants should be at the rate of Rs.200/- per sq.meter. The exemplar land, on the basis of which the appellants desired the determination of market price, itself was sold at the rate of Rs.161/- per sq.meter (total area 105.90 sq.meters sold at the rate of Rs.17,000/- vide sale deed dated 02.05.1986). The area of the exemplar land was rather  small,  in  comparison  to  the  acquired  land.  There  is therefore no justification on facts, for the acquired land being given  land  value  more  than  the  exemplar  land.  For  the  reasons recorded  hereinabove,  we  consider  it  just  and  appropriate  to determine the market value of the acquired land at the rate of Rs.161/- per sq.meter i.e., the same as the exemplar land. Ordered accordingly.

The appeals are allowed in the above terms. The  appellants  shall  also  be  entitled  to  all

consequential  statutory  benefits.  Since  the  acquisition  of  the appellants' land relates to the year 1986-87, we consider it just and  appropriate  to  direct  the  respondents  to  disburse  the

Page 5

5

compensation payable to the land loser i.e. the appellants herein within three months from the date of receipt of a certified copy of this order.

                      ..........................J.

         (JAGDISH SINGH KHEHAR)

..........................J.                              (KURIAN JOSEPH)

                           ..........................J.           (ARUN MISHRA)

NEW DELHI; JULY 28, 2016.

Page 6

6