TEK CHAND (DEAD) BY L.RS. AND ORS.versusUNION OF INDIA AND ORS. ETC.

             TEK CHAND (DEAD) BY L.RS. AND ORS.
A
                             v.
                UNION OF INDIA AND ORS. ETC.

                              AUGUST 31, 1990

B     [M.H. KANIA, K.N. SAIKIA AND K. RAMASWAMY, JJ.]
         '';
          Land Acquisition Act, 1894: Section 4-Acquisition of land-
    Determining compensation thereof-Relevant factors and circumstances
    -High Court placing reliance on circumstances not relevant-Matter
    remanded to High Court.
c         Notification nnder section 4 of the Land Acqnisition Act, 1894 was     •
    issned in respect of the appellant's lands in 1959 and the lands were        '
    acquired. The Land Acquisition Collector awarded compensation at the
    rate of Rs.2,000 per bigha, as also solatium and interest.

D         The appellants approached the District Conrt which enhanced the
    compensation from Rs.2,000 per bigha to Rs.4,000/5,000 per bigha.
    The appellants preferred appeals before the High Court. Taking into
    acconnt a comparable sale in the area few months before the Notifica-
    tion, the High Court enhanced the compensation to Rs.7,000 per bigha
    and also awarded solatium and interest. The plea for higher compensa-
E   tion on the gronnd that some developed plots were sold by a real estate
    company at a higher rate was negatived since according to the High
    Co.urt that company was in a better position to develop the land and
    that th~ potentiality of the land in its hands was greater.

         These appeals, by special leave, are against the said orders of the
F   High Court.

          Allowing the appeals,

          HELD: 1. In land acquisition proceedings compensation has to he
    fixed on the basis of a hypothetical sale at or about the time of the
G   notification under section 4 of the Land Acquisition Act of similar land
    by a willing seller to a willing boyer, there being no other factors like
    urgent need of money or urgent need of the land for a special purpose
    and so on which might depress or augment the price. In determining
    this compensation the ability of a particular party or his lack of ability
    to develop the land and to realise its potential, cannot be regarded as a
H   relevant .circmnstance. The High Court, therefore, was in error in

                                       126
-                       TEK CHAND v. U.0.1. [KANIA, J.]


    placing great reliance of the aforesaid circumstance in determining the
                                                                           127



    value of the land for fixing the compensation. [128F-H]                       A


           2. The appellants have failed to furnish any material on record of
    this Court on which this Court could fix the proper compensation nor
    have any arguments been advanced in that regard. In these circum-
    stances, the impugned judgments and orders are set aside and the appe-        B
    als remanded to the High Court for determination of the proper com-
    pensation for the lands acquired in accordance with law, and in the
    light of our judgment. [129A-B]


         CIVIL APPELLATE JURISDICTION: Civil Appeals Nos.
    1334 and 1335 of 1982.                                                        c

          From the Judgment and Order dated 9.11.1979 and 8.5.1979 of
    Delhi High Court in LP.A. No. 192 of 1979 and R.F.A. No. 245 of 1969.

                                                                                  D
          Sasidharan and P.K. Pillai for the Appellants.

        Tapas Ray, A.K. Srivastava and Ms. A. Subhashini for the
    Respondents.

          The following Order of the Court was delivered:                         E


          KANlA, J. Lands comprising a few bighas belonging to the clai-
    mants (appellants) and situated in the area now known as 'Nehru Place' in
    Delhi were notified for acquisition by the Government of India by a Notifi-
    tion dated• November 13, 1959, issued under Section 4 of the Land             F
    Acquisition Act. 1894. The said lands were duly acquired under the
    said Act. In compensation proceedings the Land Acquisition Collector
    awarded to the claimants (appellants) compensation at the rate of
    Rs.2,000 per bigha and further awarded solatium and interest as pro-
    vided by law. In two references under section 18 of the Land Acquisi-
    tion Act at the instance of the appellants, the Additional District           G
    Judge enhanced the compensation from Rs.2,000 per bigha to
    Rs.4.000/5,000 per bigha. From the orders of the Additional District
    Judge. -the appellants filed appeals in Delhi High Court. The Delhi
    High Court enhanced the compensation to Rs.7 ,000 per bigha and also
    awarded solatium and interest. Compensation was detern1incd at the
    aforesaid rate largely on the footing of a sale of comparable land by         H
A
    128         SUPREME COURT REPORTS                [1990] Supp. 1 S.C.R.

    one Puran to the Delhi Finance Company Private Limited (hereinafter
                                                                                 -
    referred to as the 'DLF Co.'). That sale took place a few months prior
    to the date of the Notification and rate at which the land was sold was
    Rs.6,000·per bigha. In view of the period of few months which had
    gone-by and the rise in land values, the High Court determined the
    compensation at Rs.7,000 per bigha. The claimants strongly relied on
B
    the instances of ·sales of small developed plots by the DLF Co. and
    pointed out that it was on the basis of the sales that the High Court had
    awarded compensation at the rate of Rs.11 per sq. yard to the DLF
    Co. in respect of similar lands of the said company acquired by the
    government. This amount was arrived at by taking the price of
    developed plots sold by DLF Co. and deducting therefrom the cost of
c   development. It was alleged by the claimants that this land was conti-
    guous to the land of the claimants acquired as aforesaid and the acqui-
    sition was at almost the same time as in the case of the claimants. It
    was submitted by them that the principal reason given by learned
    District Judge as well as the High Court for not accepting the instance
    of the compensation awarded to DLF Co. was not tenable in law. It
D
    was submitted by them that compensation should also have been
    awarded to them on the basis of the said instance. The High Court has
    taken the.view that the instance of compensation awarded to DLF Co.
    was not acceptable mainly because that company was in a position to
    develop the land and to realise its potentiality and had been able to sell
    certain developed plots at a very much higher rates. The High Court
E
    took the view that the higher compensation was liable to be awarded to
    the DLF Co. because that organisation was in a better position to
    develop the land and hence, the potentiality of the land in its hands
    was greater.

          With respect to learned Judges of the High Court who delivered
F
    the impugned judgment, in our opinion, the view taken by them can-
    not be sustained. In land acquisition proceedings compensation has to
    be fixed on the basis of a hypothetical sale at or about the time of the
    notification under section 4 oft.he Land Acquisition Act of similar land
    by a willing seller to a willing buyer, there being no other factors like
    urgent need of money or urgent need of the land for a special purpose
G
    and so on which might depress or augment the price. In determining
    this compensation the ability of a particular party or his lack of ability
    to develop the land and to realise its potential. cannot be regarded as a
    relevant circumstances. The High Court, therefore, was in error in
    placing great reliance of the aforesaid circumstances in determining
H   the value ot tlie land for fixing the compensation.
                           TEK CHAND v. U.0.1. [KANJA, J.]                 129

              We would have proceeded to determine the compensation our"          A
        selves but for the fact that the appellants have failed to furnish arty
        material Ori record of this Court on which we can fix the ptoper tbm"
        pensation nor have any arguments been advanced before us in that
        regard. In these circumstances, we set aside the impugned judgments
        and orders and remand the appeals to the Delhi i-ligh Court for
        determination of the proper compensation for the lands acquired in
                                                                                  B
        accordance with law. The appeals are accordingly ailowed. There will
        be no order as to costs.

        G.N.                                                 Appeals allowed.




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