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Bombay High Court

THE STATE OF MAHARASHTRA AND ORSversusCHANDRAKANT ZUMBAR YADAV AND ANR

Disposal
PARTLY ALLOWED AND PARTLY DISMISSED

Holding

The Reference Court’s valuation of Rs 2,000 per R is reasonable and upheld, but the interest direction is modified to conform with State of Maharashtra v. Kailas Shiva Rangari.

Summary

The State of Maharashtra appealed a common Judgment and Award that had enhanced compensation for land acquired for the Lasona Percolation Tank. The acquisition was notified in 1995, but possession was taken in 1992 and the award was made in 1998. Claimants had accepted compensation under protest and sought a reference under Section 18 of the Land Acquisition Act, 1894. The Reference Court increased the market value to Rs 2,000 per R, relying on a 1992 sale (Exhibit 23) after adjusting for a share in a well and applying a 10% per‑annum escalation for three years. The State argued that the sale was not comparable and the valuation excessive, while the claimants contended the valuation was proper. The High Court held that the Reference Court’s methodology was reasonable and the Rs 2,000 per R valuation was justified, but modified the award to correct the interest calculation in line with State of Maharashtra v. Kailas Shiva Rangari. Consequently, the appeals were partly allowed, limiting the modification to the interest component.

Issues considered

  • Whether the Reference Court was justified in determining the market value of the acquired land at Rs 2,000 per R based on the 1992 sale transaction.
  • Whether the direction to pay interest from the date of notification under Section 4 of the Act is consistent with prevailing law.

Legislation cited

Subjects

  • land acquisition
  • compensation
  • market value determination
  • Section 18 reference
  • interest calculation
  • valuation methodology
  • percolation tank

Judgment

2026:BHC-AUG:41861
                                                                        11-FA-5078-2017.odt
                                                1

                      IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                 BENCH AT AURANGABAD

                                11 FIRST APPEAL NO. 5078 OF 2017

                              The State of Maharashtra And Others
                                            VERSUS
                                   Mangalbai Fulchand Yadav
                                             ……
                                12 FIRST APPEAL NO. 5079 OF 2017

                             The State of Maharashtra And Others
                                           VERSUS
                            Chandrakant Zumbar Yadav And Another
                                             ……
          Mr. S.N. Morampalle, AGP for Appellant-State in FA/5078/2017
          Mr. S.S. Dande, AGP for Appellant-State in FA/5079/2017
          Ms. Laxmi R. Thakur, Advocate h/f Mr. L.C. Patil, Advocate for Respondents-
          Claimants in both FAs
                                             ……

                                         CORAM : SIDDHESHWAR S. THOMBRE, J.
                                         DATE       : 04 SEPTEMBER, 2026
          PER COURT :

          1.     Heard learned AGPs appearing for the appellant-State and learned

          counsel appearing for the respondents-claimants.


          2.     These Appeals take exception to the common Judgment and Award

          dated 11.03.2013 passed by the learned Civil Judge, Senior Division,

          Osmanabad, in Land Acquisition Reference Nos.85 of 2007 and 440 of 2008,

          whereby the learned Reference Court partly allowed the References under

          Section 18 of the Land Acquisition Act, 1894 (for short, “the Act”) and

          enhanced the compensation payable to the respective claimants along with

          the statutory benefits.
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3.     The lands belonging to the respective claimants, situated at village

Lasona, Taluka and District Osmanabad, came to be acquired for the

Percolation Tank, Lasona. The particulars of the acquired lands are as under:


         Sr. No.      LAR No.         Survey/Gat No.       Area Acquired
            1.       85 of 2007            177              03 H 70 R
            2.      440 of 2008         153 & 174           02 H 87 R


3.     The notification under Section 4 of the Act was published on

17.04.1995. The possession of the acquired lands was taken on 29.04.1992,

i.e. prior to publication of the notification under Section 4 of the Act. The

Special Land Acquisition Officer (for short, “the SLAO”) passed the Award

under Section 11 of the Act on 30.07.1998 and determined the market value

of the acquired lands at the rates of Rs.130/-, Rs.145/- and Rs.170/- per R.

The claimants, being dissatisfied with the market value determined by the

SLAO, accepted the compensation under protest and sought references

under Section 18 of the Act. Accordingly, the references came to be made to

the learned Reference Court.


4.     Before the learned Reference Court, the claimants relied upon the

sale instances at Exhibits 23 and 24. The sale instance at Exhibit 23 is dated

09.09.1992, whereas the sale instance at Exhibit 24 is dated 31.03.1993.

The learned Reference Court placed reliance upon the sale instance at

Exhibit 23 and enhanced the market value of the acquired lands to

Rs.2,000/- per R, together with the statutory benefits. Hence, the present
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Appeals at the instance of the State.


5.     Learned AGPs appearing for the appellant-State submit that the

learned Reference Court was not justified in enhancing the market value to

Rs.2,000/- per R. According to them, the sale instance relied upon by the

claimants was not a comparable transaction and the enhancement granted

by the learned Reference Court is excessive and without sufficient

evidentiary basis. It is submitted that the acquired lands and the land

covered by Exhibit 23 were not shown to be comparable with regard to their

situation, nature and potentiality. The learned AGPs, therefore, submit that

the impugned Judgment and Award deserves to be interfered with.


6.     Per contra, learned counsel appearing for the respondents-claimants

supports the impugned Judgment and Award. She submits that the sale

instance at Exhibit 23 is a genuine transaction executed on 09.09.1992, i.e.

nearly three years prior to the notification under Section 4 of the Act, and

relates to land situated in the vicinity. She submits that the learned

Reference Court has not mechanically relied upon the sale consideration,

but has properly worked out the value attributable to the land after

excluding the amount referable to the share in the well and thereafter

granted appropriate escalation for the intervening period. According to her,

the ultimate determination of Rs.2,000/- per R is just, reasonable and

supported by the evidence on record. He, therefore, submits that no

interference is warranted.
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                                       4


7.     I have considered the rival submissions advanced by the learned

counsel for the respective parties and have carefully perused the impugned

Judgment and Award as well as the material available on record.


8.     The principal question that falls for consideration is whether the

learned Reference Court was justified in determining the market value of the

acquired lands at the rate of Rs.2,000/- per R on the basis of the sale

instance at Exhibit 23.


9.     The sale instance at Exhibit 23 is dated 09.09.1992. Thus, the

transaction is of a date about three years prior to the publication of the

notification under Section 4 of the Act on 17.04.1995. The transaction

covers an area of 99 R. The sale consideration mentioned therein is

Rs.1,50,000/-. The said consideration includes not only the price of the land

but also the price attributable to 1/3rd share in the well.


10.    The learned Reference Court considered the fact that the claimants

had not led any specific evidence enabling an exact bifurcation of the

consideration between the land and the 1/3rd share in the well. In the

circumstances, as a matter of prudence, the learned Reference Court

assessed the price attributable to the well at Rs.30,000/- and, having regard

to the fact that the transaction concerned 1/3rd share therein, deducted

Rs.10,000/- from the total sale consideration. Thus, the consideration

attributable to the land was taken at Rs.1,40,000/-. On dividing the amount
                                                                11-FA-5078-2017.odt
                                      5

of Rs.1,40,000/- by the area of 99 R, the market value works out to

approximately Rs.1,414/- per R in the year 1992.


11.    The learned Reference Court thereafter granted escalation for the

period of three years between the date of the sale transaction and the date

of the notification. By applying an increase of 10% per annum, i.e. 30% for

the intervening period, an amount of approximately Rs.424/- per R was

added to the rate of Rs.1,414/- per R. Consequently, the rate worked out to

approximately Rs.1,838/- per R in the year 1995.


12.    Having regard to the aforesaid calculation, the learned Reference

Court ultimately determined the market value of the acquired lands at

Rs.2,000/- per R. Thus, the determination made by the learned Reference

Court is not without basis. On the contrary, the rate of Rs.2,000/- per R is

reasonably relatable to the rate emerging from the comparable sale

transaction after making appropriate adjustment for the amount attributable

to the well and the intervening escalation.


13.    It is well settled that while determining the market value of acquired

land, the Court is required to take into consideration the best available

evidence, particularly genuine and comparable sale instances proximate in

point of time to the relevant date. The transaction at Exhibit 23 is of a date

prior to the notification under Section 4 of the Act and provides a concrete

basis for determination of the market value. The appellant-State has not
                                                                11-FA-5078-2017.odt
                                       6

been able to demonstrate that the said transaction is sham, artificial or

otherwise unreliable. Nor has the appellant-State brought on record any

better or more comparable sale instance so as to displace the evidence relied

upon by the learned Reference Court.


14.    Upon an independent re-appreciation of the evidence, I find that the

approach adopted by the learned Reference Court is reasonable and

supported by the material on record. The determination of market value at

Rs.2,000/- per R cannot be said to be perverse, arbitrary or excessive so as

to warrant interference in appellate jurisdiction. The compensation so

determined appears to be just and reasonable.


15.    However, the grievance of the appellant-State regarding the grant of

interest deserves consideration. The learned Reference Court has directed

payment of interest from the date of notification under Section 4 of the Act.

Such direction is not in consonance with the law laid down by the Full

Bench of this Court in State of Maharashtra Vs. Kailas Shiva Rangari, 2016

(3) Mh.L.J. 457. Therefore, to that limited extent, the impugned Judgment

and Award requires modification.


16.    In view of the above discussion, the Appeals deserve to be partly

allowed only to the extent of modification in respect of interest. The

determination of market value at Rs.2,000/- per R and the consequential

statutory benefits, subject to the modification regarding the period and
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                                          7

computation of interest, do not call for interference. Hence, the following

order:

                                     ORDER

(i)        The First Appeals are partly allowed.


(ii)       The common Judgment and Award dated 11.03.2013 passed by the

learned Civil Judge, Senior Division, Osmanabad, in Land Acquisition

Reference Nos.85 of 2007 and 440 of 2008 is modified to the aforesaid

extent.


(iii)      The respondents-claimants shall be entitled to interest under

Sections 28 and 34 of the Land Acquisition Act, 1894, in accordance with

the law laid down by the Full Bench of this Court in State of Maharashtra

Vs. Kailas Shiva Rangari (supra).


(iv)        The remaining part of the common Judgment and Award dated

11.03.2013 passed by the learned Reference Court in Land Acquisition

Reference Nos.85 of 2007 and 440 of 2008 shall remain unaltered.


(vi)       The modified award be drawn accordingly.


(vii)      Pending Civil Applications, if any, stand disposed of.




                                               [ SIDDHESHWAR S. THOMBRE ]
                                                         JUDGE
S P Rane


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