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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.5160  OF 2013 (Arising out of S.L.P. (C) No.354 of 2012)

Ramanlal Deochand Shah …Appellant

Versus

The State of Maharashtra & Anr. …Respondents

WITH

CIVIL APPEAL NO.5161  OF 2013 (Arising out of S.L.P. (C) No.395 of 2012)

Kantilal Manikchand Shah …Appellant (since deceased by his L.Rs.)

Versus

The State of Maharashtra & Anr. …Respondents

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J U D G M E N T

T.S. THAKUR, J.

1. Leave granted.  

2. These  appeals  arise  out  of  two  separate  but  similar  

orders dated 14th June, 2011 and 16th March, 2011 passed  

by the High Court of  Judicature at Bombay whereby First  

Appeal  Nos.179  of  1992  and  751  of  1992  filed  by  the  

respondent-State of Maharashtra have been allowed and the  

judgment  and  order  passed  by  the  Reference  Court  

enhancing  the  amount  of  compensation  payable  to  the  

appellants-land  owners  to  Rs.85/-  per  square  meter  set  

aside.

3. In SLP (C) No.354 of 2012 the appellants prayed for  

enhancement of compensation payable towards compulsory  

acquisition of plots no.33, 34, 45 and 46 measuring 1366  

square  meters  each,  situated  at  village  Saidapur,  Taluq-

Karad,  District  Satara,  Maharashtra.  The  public  purpose  

underlying  the  acquisition  was  the  setting  up  of  a  

Polytechnic Engineering College at Karad. The appellant-land  

owners  claimed  compensation  @  Rs.25/-  per  sq.  ft.  The

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Special Land Acquisition Officer, Satara, however, made an  

Award  dated  14th March,  1988  determining  the  

compensation  @  Rs.26.25  per  sq.  mtr.  only.  Dissatisfied  

with  the  award  made  by  the  Collector  the  appellant-land  

owners  got  the  matter  referred  to  the  Civil  Court  for  

determination of the market value of the land under Section  

18 of the Land Acquisition Act besides solatium and interest  

payable on the same.  A similar reference was also made in  

SLP (C) No.395 of 2012 for plot no. 47 admeasuring 1366  

sq. mtrs. of the same village.  

4. The  claim  made  by  the  appellant-land  owners  was  

contested  by  the  respondent-State  giving  rise  to  the  

following issues in Reference No.12 of 1988 relevant to SLP  

(C) No.354 of 2012:

(i) Is the claimant entitled to Rs.9,27,064/- in addition to  

Rs.2,31,716/-  from  the  opponent-referee  by  way  of  

compensation as claimed?

(ii) Is the claimant entitled for interest at the rate of 15%  

p.a. on the amount of compensation as claimed?

(iii) Is the claimant entitled to solatium as claimed?

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(iv) What order?

5. Similar issues were framed in the connected Reference  

No.4 of 1988 relevant to SLP (C) No.395 of 2012, save and  

except that the total amount claimed in the same was lower  

having regard to the lesser number of plots acquired in that  

case.

6. The Reference Court answered the issues in favour of  

the appellants and enhanced the compensation payable to  

them  to  Rs.85/-  per  sq.  mtr.  besides  interest  at  the  

stipulated rates by similar but separate Awards both dated  

31st January,  1991.  While  doing  so,  the  Reference  Court  

relied  entirely  upon certain  observations  made by  Special  

Land Acquisition Officer  and the Draft  Award prepared by  

him.  The  Reference  Court  held  that  from  the  discussion  

contained in the Draft Award it was not clear as to how the  

Special Land Acquisition Officer had awarded compensation  

@ Rs.26.25 per sq. mtr. Relying upon the discussion in the  

Draft Award and taking advantage of an apparent conflict  

between the discussion contained therein and the amount  

actually awarded by the Special Land Acquisition Officer the

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Reference Court enhanced the compensation to Rs.85/- per  

sq. mtr. as already noticed above.  The High Court has, in  

the  appeals  filed  by  the  State  Government  against  the  

enhancement of compensation, reversed the view taken by  

the Reference Court on the ground that the enhancement  

was not justified in the absence of any evidence to show  

that the market value of the property in question was higher  

than  what  was  awarded  by  the  Special  Land  Acquisition  

Officer. The High Court declared that claimants were in the  

position  of  plaintiffs  and  the  burden  to  prove  that  the  

amount  of  compensation  awarded  by  the  Special  Land  

Acquisition Officer was not adequate lay upon them. It was  

only if that burden was satisfactorily discharged by cogent  

and reliable evidence that the Reference Court could direct  

enhancement.  No such evidence  having been adduced by  

the landowners, the High Court set aside the order passed  

by the Reference Court and answered the reference in the  

negative  thereby  dismissing  the  claim  made  by  the  

landowners.   

7. We have heard learned counsel for the parties at some  

length. It is trite that in a reference under Section 18 of the

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Land  Acquisition  Act  on  the  question  of  adequacy  of  

compensation  determined  by  the  collector,  the  burden  to  

prove that the collector’s award does not correctly determine  

the amount of  compensation  payable  to the landowner is  

upon the owner concerned.  It is for the claimant to prove  

that  the  amount  awarded  by  the  Collector  needs  

enhancement, and if so, to what extent. The claimant can do  

so  by  adducing  evidence,  whether  oral  or  documentary  

which the Reference Court would evaluate having regard to  

the provisions of Sections 23 and 24 of the Land Acquisition  

Act  while  determining  the  compensation  payable  to  the  

owners. To that extent the claimant is in the position of a  

plaintiff before the Court.  In the absence of any evidence to  

prove that the amount of award by the Collector does not  

represent the true market value of the property as on the  

date of the preliminary notification, the Reference Court will  

be  helpless  and  will  not  be  justified  in  granting  any  

enhancement.  The  Court  cannot  go  by  surmises  and  

conjectures while answering the reference nor can it assume  

the  role  of  an  Appellate  Court  and  enhance  the  amount  

awarded by reappraising the material that was collected and

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considered by the Collector.  What is important to remember  

is that a reference to a Civil Court is not in the nature of an  

appeal  from one  forum to  the  other  where  the  appellate  

forum takes a view based on the evidence before the forum  

below. The legal position is settled by the decisions of this  

Court to which we may at this stage refer.  In  Chimanlal  

Hargovinddas v. Spcl. Land Acquisition Officer & Anr.   

(1988) 3 SCC 751,  the controversy related to a correct  

valuation of a piece of land that was under acquisition.  This  

Court found that the Reference Court had virtually treated  

the award to be a judgment under appeal hence fallen in  

error  on the fundamental  question  of  the approach to be  

adopted while answering a reference. The Court observed:

(1) A  reference  under  Section  18  of  the  Land    Acquisition Act is not an appeal against the award and  the court cannot take into account the material relied   upon  by  the  Land  Acquisition  Officer  in  his  award   unless  the  same  material  is  produced  and  proved  before the court.

(2) So  also  the  award  of  the  Land  Acquisition  Officer is not to be treated as a judgment of the trial   Court open or exposed to challenge before the court   hearing the reference. It is merely an offer made by  the Land Acquisition Officer and the material utilised   by him for making his valuation cannot be utilised by   the court unless produced and proved before it.  It is  not the function of the court to sit in appeal against   the award,  approve or disapprove its  reasoning,  or  

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8 correct  its  error  or  affirm,  modify  or  reverse  the   conclusion reached by the Land Acquisition Officer, as   if it were an appellate court.

(3) The  court  has  to  treat  the  reference  as  an    original  proceeding  before  it  and  determine  the   market  value  afresh  on  the  basis  of  the  material   produced before it.

(4) The claimant is in the position of a plaintiff who    has to show that the price offered for his land in the   award  is  inadequate  on  the  basis  of  the  materials   produced in court. Of course the materials placed and  proved  by  the  other  side  can  also  be  taken  into   account for this purpose.”

     (emphasis supplied)

8. In the  Spcl.  Land Acquisition Officer & Anr.  etc.   

etc.  v.  Siddappa  Omanna  Tumari  &  Ors.  etc., 1995  

Supp (2) SCC 168, a three Judge Bench was dealing with a  

case  where  the  question  that  fell  for  determination  was  

whether it was open to a Reference Court to determine the  

amount  of  compensation  exceeding  the  amount  of  

compensation determined in the award without recording a  

finding  on  consideration  of  the  relevant  material  therein,  

that the amount of compensation determined in the award  

under Section 11 was inadequate.  Answering the question  

this  Court  considered  the  entire  legislative  scheme

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underlying the Act and clarified that a claimant was in the  

position of a plaintiff on whom lay the burden of proving his  

case that the compensation awarded by the Collector was  

inadequate. The following passage in this regard is apposite:

“When  the  Collector  makes  the  reference  to  the   Court,  he  is  enjoined  by  Section 19 to  state  the  grounds on which he had determined the amount of   compensation  if  the  objection  raised  as  to  the  acceptance  of  award  of  the  Collector  under   Section 11 by  the  claimant  was  as  regards  the  amount  of  compensation  awarded  for  the  land  thereunder. The Collector has to state the grounds   on  which  he  had  determined  the  amount  of   compensation  where  the  objection  raised  by  the   claimant  in  his  application  for  reference  under   Section 18 was  as  to  inadequacy  of  compensation  allowed by the award under Section 11, as required  by  Sub-section  (2)  of  Section 18 itself.  Therefore,  the  legislative  scheme  contained  in  Sections     12  ,     18     and     19     while  on  the  one  hand    entitles the claimant not to accept the award made  under Section     11     as to the amount of compensation    determined  as  payable  for  his  acquired  land  and  seek a reference to the court  for determination of   the amount of compensation payable for his land, on  the other hand requires him to make good before   the Court the objection raised by him as regards the   inadequacy of the amount of compensation allowed  for his land under the award made under Section     11  ,  with  a view to enable the Court  to determine the   amount of  compensation exceeding the amount of   compensation  allowed  by  the  award  under   Section 11, be it by reference to the improbabilities   inherent  in  the  award  itself  or  on  the  evidence   aliunde adduced by him to that effect. That is why,  the position of a claimant in a reference before   the  Court,  is  considered  to  be  that  of  the   +plaintiff in a suit requiring him to discharge  the initial burden of proving that the amount of   compensation determined in the award under  Section     11     was inadequate  , the same having not    been determined on the basis of relevant  material  

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10 and by application of correct principles of valuation,   either with reference to the contents of the award   itself  or  with  reference  to  other  evidence  aliunde  adduced  before  the  Court.  Therefore,  if  the  initial   burden  of  proving  the  amount  of  compensation  allowed  in  the  award  of  the  Collector  was  inadequate,  is  not  discharged,  the  award  of  the  Collector  which  is  made  final  and  conclusive   evidence  under  Section     12  ,  as  regards  matters    contained therein  will  stand unaffected. But  if  the  claimant  succeeds  in  proving  that  the  amount  determined  under  the  award  of  the  Collector  was   inadequate, the burden of proving the correctness of   the  award  shifts  on  to  the  Collector  who  has  to   adduce sufficient evidence in that behalf to sustain   such award. Hence, the Court which is required to   decide the reference made to it under Section 18 of  the  Act,  cannot  determine  the  amount  of   compensation payable to the claimant for  his land   exceeding the amount determined in the award of   the  Collector  made under  Section 11 for  the  same  land, unless it gets over the finality and conclusive   evidentiary value attributed to it under Section 12,  by recording a finding on consideration of relevant   material  therein  that  the  amount of  compensation  determined under the award was inadequate for the  reasons that weighed with it.”

                    (emphasis supplied)

9. In Major Pakhar Singh Atwal and Ors. v. State of   

Punjab and  Ors., 1995 Supp (2) SCC 401 also this Court  

reiterated the position that a reference under section 18 of  

the Land Acquisition Act is not an appeal against the award  

of the LAO. It merely is an offer. The proceeding before the  

Reference Court is of such nature that it places the claimant  

in the position of a plaintiff and the Reference Court is akin  

to a court of original jurisdiction. The Court observed:

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11 “… … It is now settled law that the award is an offer   and  whatever  amount  was  determined  by  the  Collector  is  an  offer  and  binds  the  Improvement   Trust.  However,  the  Collector  also  is  required  to   collect  the  relevant  material  and  award  compensation  on  the  basis  of  settled  principles  of   determination  of  the  market  value  of  an  acquired   land. The Improvement Trust, therefore, cannot go   behind  the  award  made  by  the  Collector.  Reference     is  not  an  appeal.  It  is  an  original    proceeding.  It  is  for  the  claimants  to  seek  the  determination of proper compensation by producing   sale  deeds  and  examining  the  vendors  or  the   vendees as to passing of consideration among them,   the nearness of the lands sold to the acquired lands,   similarly of the lands sold and acquired and also by  adduction of other relevant and acceptable evidence.  In this case, for the Court under Section 18 of the  Act,  the  Tribunal  is  constituted.  Therefore,  if  the  claimants intend to seek higher compensation to the  acquired land, the burden is on them to establish by   proof  that  the  compensation  granted  by  the  Land   Acquisition  Officer  is  inadequate  and  they  are   entitled  to  higher  compensation. That  could  be  established  only  by  adduction  of  evidence  of  the   comparable sale transactions of the land acquired or   the lands in the neighbourhood possessed of similar   potentiality or advantages. … … …  No doubt, in the  award itself, the Land Acquisition Officer referred to   the  sale  transactions.  Since  the  Land  Acquisition   Officer is an authority under the Act, he collected the   evidence to determine the compensation as an offer.   Though that award may be a material evidence to be   looked  into,  but  the  sale  transactions  referred  to   therein cannot be relied upon implicitly, if the party   seeking enhancement resists the claim by adducing  evidence  independently  before  the  Court  or  the   Tribunal. In this case, since no steps were taken to  place the sale transaction referred in the award, they   cannot be evidence.  So they can neither be relied   upon nor can be looked into as evidence.”

           (emphasis supplied)

10. It  is  not  in  dispute  that  the  landowners,  appellants  

before us, did not lead any evidence in support of their claim

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before the Reference Court to prove that the market value of  

the land acquired from the ownership was more than what  

was awarded as compensation by the Collector. Neither the  

order passed by the Reference Court nor that passed by the  

High Court make any reference to such evidence. Absence of  

any such evidence was, therefore, bound to go against the  

appellants.  So long as the appellants failed to discharge the  

burden  cast  on  them,  there  was  no  question  of  the  

Reference Court granting any enhancement. The High Court  

was, in that view, justified in holding that the enhancement  

granted in the absence of any evidence was unjustified.   

11. It  was  argued  by  learned  counsel  for  the  appellants  

that although no evidence was adduced by the claimants to  

prove that the market value of the acquired land was higher  

than what was awarded by the Land Acquisition Collector,  

the claimants could rely on the documents produced by the  

respondent-State before the Collector. If that be so, the Sale  

Deeds to which the Draft Award made a reference, could be  

referred  to  and relied  upon.  There  is,  in  our  opinion,  no  

merit in that contention. While it is true that the claimant  

can always place reliance upon the evidence that may be

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adduced by a defendant in a suit to the extent the same  

helps the plaintiff,  but the documents that have not been  

relied upon before the Court by the defendants cannot be  

referred to or treated as evidence without proper proof of  

the contents thereof.  In the present case the defendants-

respondents  did  not  produce  any  documents  before  the  

Reference Court in support of its case.  There was indeed no  

occasion for  them to do so in  the absence of  affirmative  

evidence from the claimants. We specifically asked learned  

counsel  for  the  respondents  whether  copies  of  any  Sale  

Deeds  had  been  produced  by  the  defendants  before  the  

Reference  Court.  The  answer  was  in  the  negative.  That  

being so, it is difficult to appreciate how the appellants could  

have referred to a document not produced or relied upon by  

the  defendants  before  the  Reference  Court.  Even  if  the  

documents had been produced by the defendants, unless the  

same  were  either  admitted  by  the  plaintiff  or  properly  

proved and exhibited  at  the trial,  the same could  not  by  

themselves  constitute  evidence  except  where  such  

documents were public documents admissible by themselves  

under  any  provision.  Sale  Deeds  executed  between  third

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parties  do not qualify  for  such admission. The same had,  

therefore, to be formally proved unless the opposite party  

admitted  the  execution  and  contents,  thereby,  in  which  

event  no  proof  may  have  been  necessary  for  what  is  

admitted, need not be proved.   

12. Suffice it to say that in the facts and circumstances of  

the present case no evidence having been adduced by the  

defendants-respondents,  whether  documentary  or  

otherwise,  there was no question of  the appellant  relying  

upon  such  non-existent  evidence.  Merely  because  some  

documents  were  referred  to  in  the  Draft  Award  by  the  

Collector, did not make the said documents admissible by  

them to enable the plaintiffs  to refer to or rely  upon the  

same in support of a possible enhancement. If a document  

upon which the plaintiffs placed reliance was available, there  

was  no  reason  why  the  same  should  not  have  been  

produced or relied upon. Inasmuch as no such attempt was  

made by the plaintiffs, they were not entitled to claim any  

enhancement.

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13. The  next  question  then  is  whether  the  appellants-  

landowners  can  be  given  another  opportunity  to  adduce  

evidence  at  this  stage  and  if  so  on  what  terms.  The  

Reference Court, it is noteworthy, was of the opinion that  

the Special Land Acquisition Officer had in the cases at hand  

relied upon two sale deeds to record a finding that the true  

market price of the land under acquisition was Rs.85/- per  

square  meter.  Having  said  that  the  S.L.A.O  had  for  no  

reason awarded an amount of Rs.26.25 per square meter  

only. This was according to the Reference Court inexplicable.  

The Reference Court observed:

“According to the S.L.A.O. the said rate is fair and  reasonable  but  actually  he  has  not  awarded  the   compensation accordingly.  He has awarded it at the   rate of Rs.26.25 ps. per sq. mtrs.  This abstruse to   understand as to how the S.L.A.O has awarded the   compensation  accordingly,  when  he  had  already   arrived  at  the  conclusion  in  respect  of  reasonable  rate  of  the  compensation.   Considering  all  these   things, I hold that the compensation ought to have   been awarded at least at the rate of Rs.85/- per sq.   mtrs. for the lands under acquisition.  For the same   reason, I also hold that the claimant is entitled for   compensation at the rate of Rs.85/- per sq. mtrs. for   the lands under acquisition.”

14. The failure or the omission to lead evidence to prove  

the claim appears in the above context to be a case of some  

kind  of  misconception  about  the  legal  requirement  as  to

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evidence  needed  to  prove  cases  of  enhancement  of  

compensation. We do not in that view see any reason to  

deny another opportunity to the landowners to prove their  

cases  by  adducing  evidence  in  support  of  their  claim  for  

enhancement.  Since,  however,  this  opportunity  is  being  

granted ex debito justitiae, we deem it fit to direct that if the  

Reference Court eventually comes to the conclusion that a  

higher  amount  was  due  and  payable  to  the  appellant-

owners, such higher amount including solatium due thereon  

would not earn interest for the period between the date of  

the judgment of the Reference Court and the date of this  

order.  These  appeals  are  with  that  direction  allowed,  the  

judgments and orders impugned in the same modified to the  

extent that while the enhancement order by the Reference  

Court  shall  stand  set  aside,  the  matters  shall  stand  

remanded  to  the  Reference  Court  for  a  fresh  disposal  in  

accordance  with  law  after  giving  to  the  landowners  

opportunity to lead evidence in support of their claims for  

higher compensation. No costs.  

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......................………..……J.    (T.S. THAKUR)

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

New Delhi       (GYAN SUDHA MISRA)  July 5, 2013