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Land Acquisition Act = The reference court like an appellant authority enhanced the compensation basing on the award of land acquisition officer even though the claimants not adduced any evidence and passed separate awards . High court set aside the award of lower court , Apex court granted an opportunity to adduce evidence to the claimants with conditions and remanded the matter to the trail court = 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 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.

published in    http://judis.nic.in/supremecourt/imgst.aspx?filename=40531   

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

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 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?

(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
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 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 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 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 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 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:

“… … 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 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 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 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.

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 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.

………………….………..……J.
(T.S. THAKUR)
………………….………..……J.
New Delhi (GYAN SUDHA MISRA)
July 5, 2013

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