B. Lamare J.
1. Heard Mr. P. Dey, learned Addl. Central Govt. Standing Counsel for the appellant, Mr. T.T. Diengdoh, learned counsel for the respondent No. 1 and Mr. S. Dutta, learned counsel for the respondent No. 2.
2. An area measuring about 93 acres located at Spread Eagle Falls in Shillong was required by the Government on behalf of Defence Ministry, . Government of India and a Notification No. RLA-435/67/15 dated 10.10.1969 was published on 15.10.1969 in the Meghalaya Gazette Under Sections 4(1) of the Land Acquisition Act, 1894 (in short the Act). Subsequently a declaration Under Section 6 of the Act was issued vide No. RLA-435/67/40 and published on 10.3.1971. After completing with the acquisition proceeding, the Collector/Deputy Commissioner, Shillong awarded a compensation of Rs. 23,71,097.60p (Rupees twenty three lakhs seventy one thousand ninety seven and paisa sixty) only in favour of Sri A.S. Khongphai. However, an objection was raised by the third party viz., Mrs. Krisibon Kharakongor and Mrs. Dallisonora Rumnong with regard to the ownership of the land, who prayed for treating them as a person interested in the said land. The matter was referred to the Reference Court Under Section 30 of the Act for deciding as to the persons who are entitled to the awarded amount. Simultaneously a petition Under Section 18 of the Act was submitted to the Collector, Shillong for referring the matter to the court to decide the quantum of compensation to which the claimants are entitled to receive in accordance with the Act.
3. The matter with regard to the reference Under Section 30 of the Act went up to this court and finally the parties settled the matter amicably and filed a compromise petition before this court. On the basis of the said compromise petition, the appeal being F.A. No. 1(SH) 94 was disposed of by this court by judgment dated 28.5.1998 in terms of the said compromise petition. Accordingly, the said Mrs. Krisibon Kharakongor was added as claimant/respondent to this appeal.
4. Reference made by the Collector, Shillong with regard to the petition Under Section 18 of the Act was also disposed of by the court of the Special Judicial Officer at Shillong in (Ref) L.A. Case No. 16(K) 76. The learned Special, Judicial Officer by judgment and order dated 3.12.1999 and award dated 8.2.2000 passed in the said (Ref) L.A. case No. 16(K)76 has awarded compensation as follows : -
'1.
For the land measuring 93 acres @0.65p. per sq.ft.
Rs.
26,33,202.00
2.
Sulatium@30%
Rs.
7,89,960:60
3.
12% interest w.e.f. 10.10.1969 to 6.2.70 date of taking possession, i.e., 3 months 26 days.
Rs.
1,01,848.00
4.
Lumpsum amount of 3217 numbers of tress
Rs.
57,906.00Total
Rs.
35,82,916.60
5.
Minus the amount already drawn
Rs.
23,71,097.60Excess amount
Rs.
12,11,819.00
6.
9% interest on the excess amount w.e.f. 6.2.1970 to the date of payment into Court.
Rs.'
5. Being aggrieved by the said impugned judgment and order and award passed by the learned Special Judicial Officer, the appellant has preferred this appeal before this Court. The respondents also filed cross objection for enhancement of the above amount awarded by Court.
6. While proceeding with the said (Ref) L.A. Case, the trial Court has framed 4 issued which are as follows :-
'Issues
1. Whether the claim petition is maintainable in its present form and whether there is any cause of action for filing this instant petition ?
2. Whether the assessment was done after taking into consideration (1) Location, nature and type of land and trees standing thereon (2) the market value of the land at the time of acquisition ?
3. Whether the rate of compensation as determined and fixed by the collector is fair, reasonable and according to law ?
4. What relief/reliefs the parties are entitled to ?'
7. The claimants examined 2 witnesses including the claimant Smti. H. Diengdoh. The collector examined on witness. Certain documents marked as paper mark A, B, C, D, E and F were also produced on behalf of the claimants/respondents. The file pertaining to the acquisition was also produced before the trial court.
8. After filing of this appeal, the cross objection was also filed by the respondents which was registered as Cross Objection No. 1(SH) 2001. In the said cross objection, the objectors/respondents have contended inter alia that the judgment and award made by the learned trial court is far below the prevailing market value of the land at the relevant time and that they have prayed for enhancement of the amount by this Court.
9. Before going into the merits of the case we would first examine the legal proposition with regard to the payment of compensation, solatium and interest as provided under the Land Acquisition Act, 1894 as also amended by the Amended Act of 1984 (hereinafter referred to as the Act and the amended Act respectively).
10. Section 23(2) of the Act reads as follows :-
'(2) In addition to the market value of the land, as above provided, the Court shall in every case award a sum of fifteen per centum on such market value, in consideration of the compulsory nature of the acquisition.'
The above provision of the Act was amended by the amended Act and Section 23(1A)(2) of the amended Act reads as follows :-
'(1A) In addition to the market value of the land provided, the Court shall in every case award an amount calculated at the rate of twelve per centum per annum on such market value for the period commencing on and from the date of the publication of the notification under Section 4, Sub-section (1), in respect of such land to the date of the award of the Collector or the date of taking possession of the land, whichever is earlier.
Explanation : In computing the period referred to in this sub-section, any period referred to in this sub-section, any period or periods during which the proceedings for the acquisition of the land were held up on account of any stay or injunction by the order of any court shall be....
(2) In addition to market value of the land, as above provided, the court shall in every case award a sum of (thirty per centum) on such market value, in consideration of the compulsory nature of the acquisition.'
11. Section 28 of the Act with regard to payment of interest provides as follows :-
'28. Collector may be directed to pay interest on excess compensation. -If the sum which, in the opinion of the Court, the collector ought to have awarded as compensation is in excess of the sum which the collector did award as compensation, the award of the Court may direct that the collector shall pay interest on such excess at the rate of six per centum per annum from the date on which he took possession of the land to the date of payment of such excess into Court.'
The said Section of the Act was amended by the amended Act and Section 28 of the amended Act reads as follows :-
'28. Collector may be directed to pay interest on excess compensation. -If the sum which, in the opinion of the Court, the Collector ought to have awarded as compensation is in excess of the sum which the collector did award as compensation is in excess of the sum which the Collector did award as compensation, the award of the Court may direct that the collector shall pay interest on such excess at the rate of (nine per centum) per annum from the date on which he took possession of the land to the date of payment of such excess into Court :
(Provided that the award of the Court may also direct that where such excess or any part thereof is paid into Court after the date of expiry of a period of one year from the date on which possession is taken, interest at the rate of fifteen per centum per annum shall be payable from the date of expiry of the said period of one year on the amount of such excess or part thereof which has not been paid into court before the date of such expiry.)'
12. The Apex Court in a catena of decisions has dealt with the method of assessment of compensation and payment of solatium and interest under the Act as well as under the amended Act. In the case of Dilwarsab Babusab Mullasab and Ors. v. Special Land Acquisition Officer reported in (1975) 1 SCC 158 the Apex Court held that it would not be safe to give too much reliance on oral evidence. The best evidence would have been the evidence of sales on similar lands at about the time of notification under Section 4(1) of the Act.
13. In (1980) Supp SCC 204, Adusumilli Gopalkrishna, Appellant v. Special Deputy Collector (Land Acquisition) respondent, the Apex Court in paragraph 4 of the judgment held as follows :-
'An assessment of the compensation payable for land acquired must take into account several factors, including the nature of the land, its present use and its capacity for a higher potential, its precise location in relation to adjoining land, the use to which neighbouring land has been put and the impact of such use on the land acquired, and so on. It seems to us that having regard to all those factors the rate of compensation which has suggested itself to us is what should be decreed.'
14. In (1991) 4 SCC 506, Bhagwathula Samanna and Ors. v. Special Tahsildar and Land Acquisition Officer, Visakhapatnam Municipality, in paragraph 7, of the judgment, the Apex Court held as follows :-
'7. In awarding compensation in a acquisition proceedings, the Court has necessarily to determine the market value of the land as on the date of the relevant notification. It is useful to consider the value paid for similar land at the material time under genuine transactions. The market value envisages the price which a willing purchaser may pay under bona fide transfer to a willing seller. The land value can differ depending upon the extent and nature of the land sold. A fully developed small plot in an important locality may fetch a higher value than a larger area in an underdeveloped condition and situated in a remote locality. By comparing the price shown in the transactions all variables have to be taken into consideration. The transaction in regard to smaller property cannot, therefore, be taken as a real basis for fixing the compensation for larger tracts of property. In fixing the market value of a larger property on the basis of a sale transactions for smaller property, generally a deduction is given taking into consideration the expenses required for development of the larger tract to make smaller plots within that area in order to compare with the small plots dealt with under the sale transaction. This principle has been stated by this Court in Tribeni Devi case.'
15. In (1994) 4 SCC 595, Jawajee Nagnatham v. Revenue Divisional Officer, Adilabad, A.P. and Ors. In paragraph 5 of the judgment, the Apex Court has held as follows :-
'....The method of valuation may be (1) opinion of experts (2) the price paid within a reasonable time in bona fide transactions of purchase of the lands acquired or the lands adjacent to the lands acquired and possessing similar advantages ; and (3) a number of years purchase of the actual or immediately prospective profits of the lands acquired. Same was the view in Tribeni Deui v. Collector of Ranchi. It was reiterated in catena of decisions, vide, Peryar and Pareekanni Rubbers Ltd. v. State of Kerala. Therefore, it is settled law that in determining the market value, the Court has to take into account either one or the other three methods to determine market value of the lands appropriate on the facts of a given case to determine the market value. Generally the second method of valuation is accepted as the best.'
16. In (1998) 2 SCC 385, Land Acquisition Officer and Revenue Divisional Officer, Chittor v. L Kamalamma (Smt.) Dead by Lrs and Ors., the Apex Court in paragraph 6 of the judgment has held as follows :-
'Further when no sales of comparable land were available where large chunks of land had been sold, even land transactions in respect of smaller extent of land could be taken note of as indicating the price that it may fetch in respect of large tracts of land by making appropriate deductions such as for development of the land by providing enough space for roads, sewers, drains, expenses involved in formation of a layout, lump sum payment as also the waiting period required for selling the sites that would be formed.'
17. With regard to the payment of solatium during the intervening period between 30.4.1982 and 24.9.1984, the Constitution Bench of the Apex Court in the case of Union of India and Anr. v. Raghubir Singh (Dead) by Lrs, etc. and Ors. reported in (1989) 2 SCC 754. In paragraph 31 of the judgment, the Apex Court held as follows :
'31. In construing Section 30(1), it is just as well to be clear that the award made by the Collector referred to here is the award made by the Collector under Section 11 of the parent Act, and the award made by the court is the award made by the Principal Civil Court of Original Jurisdiction under Section 23 of the parent Act on a reference made to it by the Collector under Section 19 of the parent Act. There can be no doubt that the benefit of the enhanced solatium is intended by Section 30(2) in respect of an award made by the Collector between April 30, 1982 and September 24, 1984. Likewise the benefit of the enhanced solatium is extended by Section 30(2) to the case of an award made by the court between April 30, 1982 and September 24, 1984, even though it be upon reference from an award made before April, 30, 1982.'
18. In (1996) 2 SCC 570, Yadavrao P. Pathade (Dead) by LRs. and Ors. v. State of Maharashtra, the Apex Court in paragraph 5 of the judgment has held as follows :-
'5. Section 23(2) provides that 'in addition' to the market value of the land as above provided, the court shall in every case award a sum at 15% preceding the Amendment Act and after the Amendment Act, 30% on such market value in consideration of the compulsory nature of the acquisition. The Legislature, therefore, made a distinction between compensation under Section 23(1) and the additional amount on such market value as solatium in consideration of compulsory nature of acquisition. In other words, Section 28does not comprehend payment of interest on solatium when it expressly mentions payment of interest on compensation under Section 28 referable to Section 23(1) of the Act. Thus the High Court was right in not awarding interest on solatium.'
19. The above judgment was, however, reversed by the Constitution Bench of the Apex Court in the case of Sunder v. Union of India reported in (2001) 7 SCC 211. In paragraphs 23 and 24 of the judgment the Apex Court has held as follows ;-
'23.... We make it clear that the compensation awarded would include not only the total sum arrived at as per Sub-section (1) of Section 23 but the remaining sub-sections thereof as well. It is thus clear from Section 34 that the expression 'awarded amount' would mean the amount of compensation worked out in accordance with the provisions contained in Section 23, including all the sub-sections thereof.
24. The proviso to Section 34 of the Act makes the position further clear. The proviso says that 'if such compensation' is not paid within one year from the date of taking possession of the land, interest shall stand escalated to 15% per annum from the date of expiry of the said period of one year 'on the amount of compensation or part thereof which has not been paid or deposited before the date of such expiry'. It is inconceivable that the solatium amount would attract only the escalated rate of interest from the expiry of one year and that there would be no interest on solatium during the preceding period. What the Legislature intended was to make the aggregate amount under Section 23 of the Act to reach the hands of the person as and when the award is passed, at any rate as soon as he is deprived of the possession of his land. Any delay in making payment of the said sum should enable the party to have interest on the said sum until he receives the payment. Splitting up the compensation into different components for the purpose of payment of interest under Section 34 was not in the contemplation of the Legislature when that section was framed or enacted.'
20. In (1997) 9 SCC 673, Manipur Tea Co. Put. Ltd. v. Collector of Hailakandi, in paragraphs 14 and 15 of the judgment, the Apex Court has held as follows :-
'14. It is sought to be contended for respondents that the reference court and the High Court have proceeded on the principle that the court has discretion to award interest @15% or less and on facts, the court found that 9% would be reasonable rate of interest. We find that the approach adopted by the reference court and High Court is not correct since the statute has given measure of assessment of interest for the first year @9% from the date of taking possession and on expiry thereof @15% till date of deposit into court of the enhanced compensation. It is a legislative principle that the claimant would be entitled to the rate of interest for the said period.
15. Under these circumstances, though the word 'may' has been used in proviso to Section 28 of the Act, it has to be construed as 'shall' and, therefore, the claimants would be entitled to interest at the rate of 9% on enhanced compensation for one year and thereafter @15% till date of deposit in the court.'
21. In the light of the above proposition of law as laid down under the Act and the amendment Act and also by the Apex Court, we now propose to deal with the case on merits.
22. The claimants/respondents in the claim petition contended that the compensation awarded by the Collector is far below the prevailing market value of the land acquired. The land was acquired for the purpose of construction of various office buildings, residential quarters and other requirements of the any authorities. The land is situated in the heart of Shillong Town and the value of the land at the relevant time was not less than Rs. 5 per sq. ft. or of an average of Rs, 2 per sq.ft. The land is also very fertile and fit for cultivation. It was connected by roads from all around. There were also good number of valuable trees standing on the land at the time of acquisition. The Collector in his written statement has contended that the acquired land was assessed considering the location, nature and type of land in the area and the prevailing market value of the land at the time of acquisition.
23. The appellant, Union of India in their written statement has contended that the valuation of the land was made as on 10.10.1969, the date of the issue of the Notification under Section 4(1) of the Act. The rate was fixed as per the prevailing market rate at that time. It is also contended that the trees were not matured trees and hence the compensation awarded for the trees was reasonable.
24. The claimant/respondent examined herself and another witness. The CW-1 in her deposition has stated that 'the rate of the land in the year 1971-72 will be about Rs. 3 per sq.ft. and this I have in evidence for the sale of land in the adjacent areas such as Umpling, Nongrimbah, Nongrim and Laitumkhrah. I have applied for certified copies of certain plots of land situated in those areas contiguous to acquired land. I cannot see properly and as such cannot read paper marks A, B, C, D, E and F but I have instructed that they are certified copies procured from the Office of the Deputy Commissioner, Shillong.' She further stated that the value of trees is about Rs. 200 for matured ones and Rs. 100 for smaller ones. In the cross-examination she stated that the land in question prior to its acquisition was let out to the defence authorities. 'I know that this land has been developed by the defence authorities after its acquisition. I do not know personally what was the growth and length/height of the trees on the land.'
25. CW-2 is an Assistant from the office of the Sub-Registrar of Shillong. He came to prove the paper marks A, B, C, D, E and F. In the cross-examination he stated 'I cannot tell the exact area and location of the certified copies of the sale deed being paper mark A to F and I cannot also say the price of the cost of land relating to paper mark A to F'.
26. The respondents examined one witness as OPW-1. He was working in the office of the Deputy Commissioner, Revenue Branch as Supervisor. He produced the file relating to the acquisition proceedings which is No. L.14/5(31)/1965. He stated that 'the total award made by the Collector was Rs. 23,71,097.60p. The possession of the land was taken on 16.2.1970. The rate assessed by the Collector was 0.50p per sq. ft. The rate was assessed by the Collector after compiling with the rate of land contiguous to the acquired land.' In cross-examination he stated that 'in Exbt. A-2 there was a mention about land acquired for the Border Security Force which was 19 paisa and 20 paisa per sq.ft., but there are no documents in Exbt. A showing that such acquisition for payment of the said rate of 19 paisa and 20 paisa for the land acquired for the Border Security Force. It is a fact that there are not documents of any land contiguous or adjacent to the acquired land which shows the value of such land.
27. From perusal of the above evidence, the CW-1 has stated that the price of land would be about Rs. 3 per sq..ft in the year 1971-72, but in the claim petition the compensation claimed was at the rate of Rs. 5 sq. ft. The paper mark A, B, C, D, E and F relates to small plots of land situated within the Shillong to small plots of land situated within the Shillong Municipality. The area involved in the said paper mark A to F are 7270 sq. ft., 4000 sq. ft. 770 sq. ft., 0.29 acres, 11802 sq. ft. and 2009 sq. ft. respectively. The lands are situated at Laitumkhrah, Umpling and Nongrimbah. In the evidence of the CWs the distance of the land acquired from the land in the paper marks A to F has not been mentioned. The lands in the said paper marks A to F were situated within Shillong Municipality whereas the land acquired is situated outside the Municipal area. There is also no evidence to show the nature, type and potentiality of the said lands to be comparable with the land acquired. More so, the land in paper marks A to F are of small areas which is not comparable to the land acquired which was 93 acres. Therefore, it can safely be concluded that rates shown in the said paper marks A to F are of no help to the claimants/respondents.
28. Coming to the other aspects of the matter, we may look into the location, utility, potentiality and nature of the land acquired. It is admitted position that before acquisition, the land was used the defence authorities and subsequently it was taken on lease by them. Notice for acquisition was issued 10.10.1969. The land is situated outside the Shillong Municipality. The land was also developed by the defence authorities since the time it was taken over by them. By the time the notification was issued the land was developed with all facilities like road, communications, water supply etc.
29. Considering the above position of the land regarding its location, suitability and potentiality, it is seen that the defence authorities found that the location of the land was suitable for their use for defence purposes. The land has potentiality for development for construction of offices, residential quarters and other requirements of the defence. This can be seen from the statement made by the defence authorities in the letter No. AS/182/ACQ/17 dated 16th October, 1969 from the Military Estate Officer, Shillong Circle to the Deputy Commissioner, Shillong which is found in the file marked as Annexure-A. Therefore, considering the above aspects of the matter regarding the location, suitability and potentiality of the land and the use to which the land was put into, we are of the view that the law laid down by the Apex Court in the case of Adusumilli Gopalkrishna (supra) may be applied in this case. We are, therefore, of the opinion that the ends of justice will be met by awarding compensation at rate of 0.80 paisa per sq. ft. we accordingly award compensation @ Rs. 0.80 paisa per sq.ft for the land. The claimants/ respondents are also entitled to a solatium at 30% of the compensation for land as per the amended Act.
30. The land acquired was taken possession by the Collector on 6.2.1970 and the awarded amount of Rs. 23,71,097.60p was paid to the claimants/respondents on 22.1.1975 without interests. The claimant/ respondents are, therefore, entitled to an interest at 6% on the above amount as per provisions of Section 34 of the Act. Section 28 of the amended Act provides for payment of interest on the excess compensation. This section provides that the rate of interest shall be 9% for a period of 1 year from the date of taking over possession of the land acquired and if the amount is not paid with 1 year, the interest at the rate of 15% P.A. is payable as per law laid down by the Apex Court in case of Manipur Tea Co. (Pvt.) Ltd. v. Collector of Hailakandi (supra). We, accordingly, award interest at the rate of 9% on the excess compensation with effect from 6.2.1970 for a period of 1 year and thereafter at the rate of 15% till the excess compensation is deposited in the court.
31. The Appeal and Cross-Objection are accordingly disposed of.
However, in the facts and circumstances of the case there will be no order as to the costs.