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LAND ACQUISITION COMPENSATION EXPERT OPINION-Shri Ravindra Ghanshyam Choudhari, who was examined by the appellants. This witness is a consultant in Agriculture and Horticulture. He personally visited the acquired land and gave the details of the trees standing on different parts of the land, their present and future age, condition, height, width, spread and annual fruit production capacity. The valuation made by him was amply supported by the market rates of fruits fixed by Agriculture and Horticulture Department of Government of Maharashtra. In the cross-examination, the witness stood by reports Exhibits 36 to 41 given by him. This being the position, the High Court had

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 IN THE SUPREME COURT OF INDIA

 CIVIL APPELLATE JURISDICTION

 C
 IVIL APPEAL NO. 5475 O
 F 2007 

Chindha Fakira Patil (D) through L.Rs. ... Appellant(s) 

 Versus

The Special Land Acquisition Officer, Jalgaon ... Respondent

 With

 C
 IVIL APPEAL NO. 5477 O
 F 2007 

 C
 IVIL APPEAL NO. 5485 O
 F 2007 

 C
 IVIL APPEAL NO. 5484 O
 F 2007 

 C
 IVIL APPEAL NO. 5479 O
 F 2007 

 C
 IVIL APPEAL NO. 5482 O
 F 2007 

 C
 IVIL APPEAL NO. 5478 O
 F 2007 

 C
 IVIL APPEAL NO. 5481 O
 F 2007 

 C
 IVIL APPEAL NO. 5480 O
 F 2007 

 C
 IVIL APPEAL NO. 5476 O
 F 2007 

 2

 J U D G M E N T

G. S. Singhvi, J.

1. These appeals are directed against judgment dated 9.11.2006 of the 

Division Bench of the Bombay High Court whereby the appeals preferred by 

the respondent under Section 54 of the Land Acquisition Act, 1894 (for 

short, `the Act') were allowed and the amount of compensation determined 

by Civil Judge, Senior Division, Jalagaon, (hereinafter described as, `the 

Reference Court') was substantially reduced. 

2. By notification dated 14.3.1996 issued under Section 4 (1) of the Act, 

the Government of Maharashtra initiated the proceedings for the acquisition 

of various parcels of land including those belonging to the appellants 

situated in villages Deoli Bhoras and Bilakhed, Taluka Chalisgaon, District 

Jalgaon for Minor Irrigation Tank, Deoli Bhoras. The declaration under 

Section 6 was issued sometime in April 1997. Special Land Acquisition 

Officer, Jalgaon (respondent) passed award dated 31.3.1999 and fixed 

market value of the acquired land by dividing the same into three groups. 

For land falling in Group I, i.e. Jirayat land, the respondent fixed market 

value at Rs.68,000/- per hectare. For Group II and Group I lands he fixed 

market value at the rate of Rs.58,000/- and Rs.54,000/- per hectare 

 3

respectively. For pot kharab land, market value was fixed at Rs.15,00/- per 

hectare. 

3. The appellants accepted the compensation under protest and then filed 

applications under Section 18 of the Act for determination of the 

compensation by the Court. On a reference made by the Collector, the 

Reference Court examined the pleadings of the parties and framed the 

following issues:

 1) What is the market price of the land on the date of 

 notification u/Sec. 4 of L.A. Act?

 2) Does the petitioner prove that he accepted the amount of 

 compensation under protest?

 3) Does the petitioner prove that the market price of land 

 determined by the L.A.O. is inadequate?

 4) Is the petitioner entitled to enhance compensation?

 5) What order? 

4. The Reference Court then considered the evidence produced by the 

parties including sale deed Exhibit 28 by which 92 ares Jirayat land 

comprised in Gat No. 97/1 was sold at the rate of Rs.2,76,041/- per hectare, 

7/12 extracts marked as Exhibits 13 to 27 and fixed market value of Jirayat 

land at the rate of Rs.3 lacs per hectare. The Reference Court also referred 

to the statement of Arjun Sukdeo Patil who deposed that there were wells in 

 4

the acquired land and fixed market value of such land at the rate of Rs.6 lacs 

per hectare by treating the same as Bagayat land. The Reference Court then 

adverted to the testimony of Shri Ravindra Ghanshyam Chaudhari, 

Agriculture and Horticulture Consultant and accepted the valuation made by 

him in respect of the trees standing on different portions of the acquired 

land. The Reference Court also held that for pot kharab, the land owners 

are entitled to 50% of the compensation determined for Jirayat land. 

5. While dealing with the appeals filed by the respondent, the High 

Court referred to the award passed by the respondent, the evidence produced 

by the parties and held that the Reference Court committed a serious error by 

recording a finding that the acquired land included Bagayat land. The High 

Court refused to rely upon Exhibit 28 by observing that there must be some 

special reasons for payment of higher price by the purchaser because various 

other sale instances of two villages indicated that the cost of land was 

between Rs.23,438/- and Rs.1 lac per hectare. As regards the trees, the 

High Court discarded the report of the valuer on the premise that the same 

had been submitted after the award was passed by the respondent. 

6. Shri Pallav Shishodia, learned senior counsel appearing for the 

appellants assailed the impugned judgment mainly on the ground that the 

 5

reasons assigned by the High Court for discarding Exhibit 28 are not only 

irrelevant but are based on pure conjectures. He emphasized that while 

determining the amount of compensation, the Reference Court was entitled 

to take into consideration the sale instance which represented highest value 

paid for similar land and the High Court committed an error by basing its 

judgment on the average value of the sale instances referred to in the award 

passed by the respondent. In support of this argument, Shri Shishodia relied 

upon the judgments of this Court in M. Vijayalakshmamma Rao Bahadur v. 

Collector, (1969) 1 MLJ 45 (SC), State of Punjab v. Hans Raj, (1994) 5 

SCC 734 and Anjani Molu Dessai v. State of Goa and another, (2010) 13 

SCC 710. Learned senior counsel further argued that the finding recorded 

by the Reference Court on the issues of the nature of land and valuation of 

the trees was based on correct appreciation of the evidence produced by the 

parties and the High Court was not at all justified in reducing the amount of 

compensation by treating the entire land as Jirayat. In the end, he submitted 

that the appellants have already received the amount of enhanced 

compensation and keeping in view the fact that they have virtually been 

made landless, this Court may set aside the impugned judgment and restore 

the award passed by the Reference Court. 

 6

7. Shri Sanjay Kharde, learned counsel appearing for the respondent 

supported the impugned judgment and argued that the High Court rightly 

reduced the compensation determined by the Reference Court by taking into 

consideration average of various sale instances produced on behalf of the 

acquiring authority and in exercise of power under Article 136 of the 

Constitution, this Court may not interfere with the finding of fact recorded 

by the High Court that the entire acquired land was Jirayat and no portion 

thereof was Bagayat. 

8. We have considered the respective arguments and carefully perused 

the record. Admittedly, the appellants had produced and proved Exhibit 28 

vide which 90 ares of Jirayat land of village Bilakhed was sold on 2.2.1995, 

i.e. prior to the acquisition in question at the rate of Rs.2,76,041/- per 

hectare. The Reference Court applied the rule of 10% annual increase in the 

prices of land and concluded that the appellants would be entitled to market 

value at the rate of Rs.3 lacs for Jirayat land. The Reference Court also 

referred to the statement of Arjun Sukdeo Patil who was examined on behalf 

of the appellants, 7/12 extracts marked Exhibits 13 to 27 and held that they 

have been able to prove that parts of their land were Bagayat and for such 

land they are entitled to compensation at the rate of Rs.6 lacs per hectare. 

 7

As regards valuation of trees, the Reference Court referred to the testimony 

of Shri Ravindra Ghanshyam Choudhari and observed:

 "So far as the valuation of trees are concerned, the claimant 

 have examined valuer Shri Ravindra Gahnshyam Chaudhari at 

 Exh. 33. He passed M. Sc. (Agri.) in the year 1978. He is 

 working as Agri. & Horticulture consultant since 1993. He has 

 produced attested certified copy of certificate at Exh. 34 and 35. 

 It is in his evidence that on 16.5.1996 to 21st May 1996, he 

 visited the acquired lands and identified with the help of 7/12 

 extract, village Sarpanch and claimants. The reports placed on 

 record at Exh. 36 to 41 respectively. He has given the details of 

 number of trees, present and future age, general condition, 

 height, width, spread, annual fruit production capacity. From 

 the wholesale market and fuel value in details in the report, and 

 calculated the value on the basis of Miram's table laid down by 

 the Agri. And Horticulture Deptt. Govt. of Maharashtra. 

 Nothing much damaging to the evidence of this valuer is 

 disclosed in the cross-examination. Considering all the factors 

 and further considering the valuation of Shri Ravindra G. 

 Chaudhari, which is supported by the claimants evidence to 

 who the market rates of fruits value and other factors. I hold 

 that the valuation made by the claimant's valuer is more 

 effective. Hence, considering these factors on record and 

 assessing the valuation made by the calimant's valuer. I fixed 

 the market value of the respective fruit trees as follows. 

 Serial. Gat Nos. Types of Trees Valuation of trees @ 80% 

 Nos. of valuation made by

 claimant's Valuer. 

 01) 87/B 7-Jujubee Rs. 53,620.00

 7 x 7660

 02) 42/A/2 5-Jujubee Rs. 35,375.00

 5x7075

 8

03) 9/2 10-Jujubee Rs. 76,560.00

 10 x 7656

 01 Lime Rs. 13,469.00

04) 151/1 21-Jujubee Rs. 1,35,030.00

 21 x 6430

 07-Tambrine Rs. 1,06,897.00

 7 x 6430

 03-Mango Rs. 77,007.00

 3 x 35669

05) 57 08-Jujubee Rs. 52,920.00

 8 x 6615

 06-Custard Apple Rs. 36,258.00

 6 x 6615

 02 Mango Rs. 45, 224.00

 2 x 22612

 61 184-Pomegranate Rs 10,27,456.00

 184 x 5584

 60- Pomegranate Rs. 2,66, 820.00

 60 x 4447

 25- Pomegranate Rs. 82,750.00

 25 x 3310

 10-Jujubee Rs. 54,150.00"

 10x 5415

 9

9. The Reference Court then briefly referred to the award of the 

respondent and held that the classification made by him solely on the basis 

of the revenue assessment was totally arbitrary and unjustified. 

10. The High Court reversed the findings of the Reference Court on all 

the counts. The High Court discarded Exhibit 28 by observing that there 

may be some special reasons for which the purchaser may be willing to offer 

Rs.3 lacs per hectare for such land. This is evident from the following 

observations made in the impugned judgment:

 "If we take these details into account, it is evident that sale 

 instance relied upon by claimant, which shows market price @ 

 Rs.3,00,000/- for jirayat land, is not safe to rely upon. This is 

 because, that being price offered by willing purchaser, there 

 may be some special reasons for which the purchaser was 

 willing to offer Rs.3.00 lacs per hectare of jirayat land, when 

 trend of the transactions shows that bagayat lands were being 

 sold @ Rs.1 lakh per hectare or so. In order to rely upon that 

 instance, it was incumbent upon the claimants to show what 

 was special about that jirayat land and not only that, but also to 

 establish on record that acquired lands also enjoy same 

 speciality."

11. In our view, the approach adopted by the High Court was clearly 

erroneous. There is no basis for the assumption that the purchaser of the 

land must have offered higher price for special reasons. Exhibit 28 was 

proved by Shri Arjun Sukdeo Patil, who had appeared as witness on behalf 

 10

of the appellants. It was open to the counsel for the respondent to cross-

examine the witness and elicit the special reasons, if any, for sale of land 

allegedly at a higher price. However, the fact of the matter is that no such 

question was put to the witness. As a matter of fact, it is neither the pleaded 

case of the respondent nor it has been argued before us that the sale deed 

Exhibit 28 had not been proved or that the price mentioned therein was not 

the highest price paid for Jirayat land in the area. Therefore, we have no 

hesitation to hold that the High Court was not right in interfering with the 

fixation of market value by the Reference Court for Jirayat land at the rate of 

Rs.3 lacs and for Bagayat land at the rate of Rs.6 lacs per hectare. The mere 

fact that average sale price of the transactions relied upon by the respondent 

was substantially less could not be made a ground for discarding Exhibit 28. 

In M. Vijayalakshmamma Rao Bahadur v. Collector (supra), this Court 

considered a question similar to the one raised in this appeal and observed:

 "After all when the land is being compulsorily taken away 

 from a person, he is entitled to say that he should be given 

 the highest value which similar land in the locality is 

 shown to have fetched in a bona fide transaction entered 

 into between a willing purchaser and a willing seller near 

 about the time of the acquisition. It is not disputed that the 

 transaction represented by Ext. R-19 was a few months 

 prior to the notification under Section 4 that it was a bona 

 fide transaction and that it was entered into between a 

 willing purchaser and a willing seller. The land comprised 

 in the sale deed is 11 grounds and was sold at `1961 per 

 11

 ground. The land covered by Ext. R-27 was also sold 

 before the notification but after the land comprised in Ext. 

 R-19 was sold. It is true that this land was sold at `1096 per 

 ground. This, however, is apparently because of two 

 circumstances. One is that betterment levy at `500 per 

 ground had to be paid by the vendee and the other that the 

 land comprised in it is very much more extensive, that is 

 about 93 grounds or so. Whatever that may be, it seems to 

 us to be only fair that where sale deeds pertaining to 

 different transactions are relied on behalf of the 

 Government, that representing the highest value should be 

 preferred to the rest unless there are strong circumstances 

 justifying a different course. In any case we see no reason 

 why an average of two sale deeds should have been taken 

 in this case."

In State of Punjab v. Hans Raj (supra), this Court held as under:

 "Having given our anxious consideration to the respective 

 contentions, we are of the considered view that the learned 

 Single Judge of the High Court committed a grave error in 

 working out average price paid under the sale transactions 

 to determine the market value of the acquired land on that 

 basis. As the method of averaging the prices fetched by 

 sales of different lands of different kinds at different times, 

 for fixing the market value of the acquired land, if 

 followed, could bring about a figure of price which may not 

 at all be regarded as the price to be fetched by sale of 

 acquired land. One should not have, ordinarily recourse to 

 such method. It is well settled that genuine and bona fide 

 sale transactions in respect of the land under acquisition or 

 in its absence the bona fide sale transactions proximate to 

 the point of acquisition of the lands situated in the 

 neighbourhood of the acquired lands possessing similar 

 value or utility taken place between a willing vendee and 

 the willing vendor which could be expected to reflect the 

 true value, as agreed between reasonable prudent persons 

 12

 acting in the normal market conditions are the real basis to 

 determine the market value."

 In Anjani Molu Dessai v. State of Goa and another (supra), the Court 

again considered the same issue and held:

 "Therefore, we are of the view that the averaging of the 

 prices under the two sale deeds was not justified. The sale 

 deed dated 31-1-1990 ought to have been excluded for the 

 reasons stated above. That means compensation for the 

 acquired lands had to be fixed only with reference to the 

 sale deed dated 30-8-1989 relied upon by the Land 

 Acquisition Collector which will be `57.50 per square 

 metre. As the said market value has been fixed with 

 reference to comparable bharad land with fruit trees, the 

 question of again separately awarding any compensation 

 for the trees situated in the acquired land does not arise."

12. In view of the law laid down in the above noted three judgments, it 

must be held that the High Court committed an error by refusing to rely 

upon Exhibit 28 on the ground that the average sale price of the transactions 

relied upon by the respondent was far less than the price for which land was 

sold vide Exhibit 28. 

13. The High Court was also not right in upsetting the finding of the 

Reference Court on the issue of nature of land. In his deposition, Arjun 

Sukdeo Patil categorically stated that there were wells in the lands of the 

appellants and there were Jujubee, Tambrine, Mango, Pomegranate trees. 

 13

This was supported by the entries contained in 7/12 extracts. The High 

Court discarded the evidence of the appellants by observing that they had 

not cultivated sugarcane and wheat. When it was not in dispute that there 

were wells in the acquired land, the mere fact that the appellants had not 

cultivated sugarcane or wheat cannot lead to an inference that the land was 

not irrigated and, in our view, there was no valid reason for the High Court 

to interfere with the finding recorded by the Reference Court that parts of the 

lands were Bagayat and for such land they were entitled to compensation @ 

Rs. 6 lacs per hectare. 

14. The High Court also committed error by rejecting the reports 

submitted by Shri Ravindra Ghanshyam Choudhari, who was examined by 

the appellants. This witness is a consultant in Agriculture and Horticulture. 

He personally visited the acquired land and gave the details of the trees 

standing on different parts of the land, their present and future age, 

condition, height, width, spread and annual fruit production capacity. The 

valuation made by him was amply supported by the market rates of fruits 

fixed by Agriculture and Horticulture Department of Government of 

Maharashtra. In the cross-examination, the witness stood by reports 

Exhibits 36 to 41 given by him. This being the position, the High Court had 

 14

no reason to overturn the finding recorded by the Reference Court on the 

issue of existence of trees on the acquired land and their valuation.

15. Learned counsel for the parties did not address any argument on the 

fixation of market value of pot kharab land. Therefore, we do not consider it 

necessary to delve into that issue.

16. In the result, the appeals are allowed, the impugned judgment is set 

aside and the award passed by the Reference Court is restored. The parties 

are left to bear their own costs. 

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

 [G. S. Singhvi]

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

 [H. L. Dattu]

New Delhi,November 01, 2011

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