2004 (1) TMI 715 - SC - Indian Laws

Determination of compensation in a land acquisition case based on market value and relevant factors - HELD THAT - It is settled law that one of the methods on which market value can be ascertained, is on basis of comparable sale deeds. As noted from the facts, the sale deed was for ₹ 15.40 per sq. yard. Section 92 of the Evidence Act precludes a party from leading evidence contrary to the terms of a written document. It was, therefore, not open to the respondent to urge that, even though his sale deed showed a price ₹ 15.40 per sq. yard the real market value was ₹ 120 per sq. yard. To permit a party to so urge would be to give a premium to dishonesty. Parties who undervalue their documents, for purpose of payment of stamp duty, cannot be allowed to then claim that their own documents does not reflect the correct market value. Therefore as per sale instances of the comparable lands the market value, on dates of sales, were in the region of ₹ 15.37 to ₹ 15.40 per sq. yard. However there is evidence of high potentiality. The increase of 15% given by the High Court cannot therefore be said to be unreasonable. Of course, the 15% increase has to be on ₹ 15.40 which is the figure shown in the sale deed. It cannot be on ₹ 120 as wrongly taken by the High Court. The High Court also erred in considering only three years increase whereas in fact there is four years difference between the respondent's sale deed and the acquisition proceedings. Thus taking an increase of 60% over the price of ₹ 15.40 per sq. yard the value comes to ₹ 24.64 per sq. yard. We accordingly set aside the order of the Reference Court and the High Court and fix value at the rate of ₹ 24.64 per sq. yard. The respondent will also to be entitled to solatium and other statutory benefits under the Land Acquisition Act, 1894. The Appeal stands disposed of accordingly. There will be no order as to cost.

Summary

Issues involved: Determination of compensation in a land acquisition case based on market value and relevant factors.

Summary:
The case involved the acquisition of land, with the main issue being the determination of fair compensation. The Land Acquisition Officer initially awarded compensation at the rate of Rs. 15.37 per sq. yards based on a sale deed. The claimants filed references under Section 18, presenting evidence of the land's potential for building construction and market rates in the area. The Reference Court fixed compensation at Rs. 150 per sq. yard, considering various factors including nearby developments and market rates set by the District Magistrate.

The appellant appealed to the High Court, which increased the compensation to Rs. 170 per sq. yards, citing the land's potential and market trends. The High Court considered the sale deed of the respondent and projected a 45% increase in land value due to ongoing developments. However, the High Court erred in not considering the actual sale deed rate but relied on the Stamp Officer's valuation of Rs. 120 per sq. yard.

Upon appeal to the Supreme Court, it was emphasized that market value should be determined based on comparable sale deeds. The Court noted discrepancies in the valuation methods used by the lower courts and corrected the valuation. The Court set aside the previous orders and fixed the value at Rs. 24.64 per sq. yard, considering a 60% increase over the original sale deed rate. The respondent was also entitled to statutory benefits under the Land Acquisition Act, 1894. The appeal was disposed of with no order as to costs.