TMI Blog1994 (10) TMI 329X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 11 at ₹ 40,000/- per Order dated October 27, 1994 in C.A. Nos. 8743-44 of 1994 (Arising out of SLl'(C) Nos. 3528-29/94 12300/94)' acre in both the cases. On reference, the Sub-ordinate Judge, Eluru, enhanced the market value in the first case to ₹ 105/- per sq. yard by deducting 30% for developmental charges out of ₹ 150/- per sq. yard fixed as its value, with usual solatium and interest. In the second case, he enhanced to ₹ 70/- per sq. yard as claimed by the claimants therein. On appeal, the High Court, by the impugned separate judgments dated September 29, 1993 enhanced the market value to ₹ 150/- in respect of land in the second case but he upheld in the first case the market value of the land at ₹ 150/- per sq, yard granting the usual solatium and interest Thus, these appeals by special leave. 4. We have heard learned Counsel on both sides and considered the reasoning of the High Court and also of the reference court vis-a-vis the evidence on record. Both the Courts committed manifest error of law. The main thrust of the arguments for the claimants is that the award of the Civil Court in Ex. A- 3 marked in the second case r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etermined on the hypothesis of the price fetched in the bona fide sale by a willing vendor who would agree to sell the lands to a willing vendee of the acquired land or the land in the neighborhood possessed of similar features. The notification Under Section 47(A) which is meant to be a guide for collection of revenue cannot form the basis for determination of market value of the land under Section 23(1) of the Act. The question of fixation or market value is a paradox which lies at the heart of the law of compulsory purchase of land. The paradox lies in the facts that the market value concept is purely a phenomena evolved by the courts to fix the price of land arrived between the hypothetical willing buyer and willing seller bargaining as prudent persons without a medium of constraints or without any extraordinary circumstances But the condition of free market is the very opposite of the condition of the compulsory purchase which is ex-hypothesis, a situation of constraints. Therefore, to say, that for compulsory purchase, compensation is to be assessed and market value is to be determined in that state of affairs has to be visualised in terms by its direct opposite. To solve the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... valuation register is, therefore, illegal and unsustainable. 8. Section 24 of the Act puts an embargo on the court that it shall not take into consideration the degree of urgency for the acquisition; disinclination of the person interested to part with possession of the acquired land; any increase in the value of the land acquired likely to accrue from the use to which it will be put when acquired; any increase to the value of the other land of the person interested likely to accrue from the use to which the land acquired will be put to; any layout or improvements on or disposal of the land acquired etc without the sanction of the Collector or after Section 4(1) notification was published, special suitability or adaptability 4 of the land for any purpose or any increase in the value of the land on account of its being put to any use which is forbidden of law are opposed to public policy. Therefore, in determining the market value and fixation of the compensation, the court should be alive to these factors and keep them at the back of the mind and should not be influenced by the future or later development in the locality or neighbourhood and should not get influenced by the prev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... municipal town. The finding recorded by the LAO in the award was that there is no upward trend in the prices. The High Court also accepted the finding of the reference court that the lands are interior though about the main road. It was also found that there are no developmental activities in the neighbourhood as on the date of notification, the LAO, therefore, treated these lands are agricultural lands. In our view, he is right in taking these lands correctly as agricultural lands. 11. Shri Tata Rao, the learned Senior counsel for the claimants in the second case placed reliance on the judgment of this Court reported in Gulzar Singh v. State of Punjab [1993]3SCR645 , and contended that this Court had accepted the potential value as a basis to determine the market value, and accordingly, he contended that the lands being situated within the municipal limits, have potential value and that therefore, market value should be determined on that basis We find no force in the contention. In fixing the market value on the basis of its potentiality for use for building purposes, it must be established by evidence aliunde that the potential purpose must exist as on the date of acquisitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... related and relevant facts should be taken into consideration in determining the compensation on the basis of potential value of the land in Gulzar Singh's case, it was found that the sale deed Ex.A.9 was a genuine sale deed between a willing vendor and a willing vendee and it furnished the basis for determination of the market value, it was also found that the land was situated in the developing area and accordingly this Court took those factors into consideration, and had fixed the market value on the basis of potential value on existing conditions. 12. Equally the decision in Inder Singh and Ors. v. U.O.I. [1993]3SCR371 , renders little assistance. In that case also, it was found that abadi land fetched ₹ 33,600/- per acre and they had potential value for development, such as for building houses etc. as in the immediate neighbourhood the lands were developed for industrial purpose. Taking those factors, this Court had determined the market value of abadi lands at ₹ 42,000/- and of other barani lands at ₹ 38,000/-. In view of the nature of lands in that case, this Court had determined the market value at the rates mentioned therein after recording the fin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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