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2015 (5) TMI 1220

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..... tions which stood rejected on 4.9.1982. Thus, the constructive knowledge of the award is fairly attributable to it when it was so passed. Constructive notice in legal fiction signifies that the individual person should know as a reasonable person would have - On a conjoint reading of Sections 12(2) and 18(2) of the Rajasthan Land Acquisition Act, it was not open to the LAO to refer the case to the civil court on the basis of the time barred application. In the instant case, the transaction is ab initio void that is right from its inception and is not voidable at the volition by virtue of the specific language used in Section 42 of the Rajasthan Tenancy Act. There is declaration that such transaction of sale of holding shall be void . As the provision is declaratory, no further declaration is required to declare prohibited transaction a nullity. No right accrues to a person on the basis of such a transaction. The person who enters into an agreement to purchase the same, is aware of the consequences of the provision carved out in order to protect weaker sections of Scheduled Castes and Scheduled Tribes. In the instant case, even the prevalent instructions which have been modif .....

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..... 626, 1627-1628, 1629-1630, 1631-1632, 1633-1634/2013 and CA Nos. 4183-4192/2015 (Arising out of SLP (C) Nos. 21344-21353/2013) JUDGMENT Arun Mishra, J. 1. Leave granted in SLP [C] Nos. 21344-21353/2015. 2. The appeals arise out of a common judgment and order dated 29.10.2009 passed by a Division Bench of the High Court of Rajasthan in Special Appeal No. 13/2001 and other connected matters. The Rajasthan Housing Board, original Khatedars and the New Pink City Housing Construction Co-operative Society Ltd. (transferee) (hereinafter referred to as the Society') have assailed the impugned judgment and order on different grounds. The Rajasthan Housing Board has prayed for setting aside direction to consider 25% of developed land and compensation, whereas the original khatedars have prayed for payment of compensation to them. Similarly, the Rajasthan Housing Board has also questioned the entitlement of the Society to claim compensation. The Society has also claimed for more value of land. 3. The State Government issued a notification Under Section 4 of the Rajasthan Land Acquisition Act, 1953 (for short 'the Act of 1953') on 12.1.1982. The land had been a .....

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..... nst the Khatedars and compromise decrees are said to have been passed on 2.10.1986, 3.10.1986 and 24.1.1988 thereby decreeing the suit in favour of the Society. 7. It was submitted on behalf of the State Government, Rajasthan Housing Board and also by the Khatedars that the transactions between the Society and Khatedars, if any, were ab initio void in view of the provisions contained in Section 42 of the Rajasthan Tenancy Act. Thus, decree obtained on the basis of void transaction is a nullity and no right had accrued to the Society to claim compensation. 8. It was urged before us on behalf of the Society that the compensation determined is inadequate. Oral evidence has been ignored by the High Court while reducing the quantum of compensation determined by Reference Court. The Society has a right to claim compensation on the basis of the agreement which has been culminated into a decree passed by the civil court. No action has been taken by Khatedars to take back the possession Under Section 175 of the Rajasthan Tenancy Act within the period of limitation of 30 years which is prescribed therein. The High Court has rightly ordered allotment of 25% of the developed land to the .....

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..... ents passed by the High Court and the Reference Court deserve to be set aside. On merits, no case for enhancement of compensation was made out. The Society has no right, title or interest in the land. The Division Bench of the High Court had gravely erred in law in directing allotment of 25% of the developed land. The prayer made by the Society for allotment of the developed land was rejected by the Rajasthan Housing Board on 14.5.2009 and 16.9.2009. The said orders were not questioned. Even otherwise the Circulars dated 13.11.2001 and that of 27.10.2005 are not applicable and not enforceable as held by this Court. The direction to allot the developed land deserves to be set aside. 11. First, we advert to the question whether reference, with respect to the four cases in which award was passed on 30.11.1982, was within period of limitation. Admittedly, possession from the Society had been taken on 22.5.1982. The Society submitted the objections before the LAO on 20.7.1982. While rejecting the objections on 4.9.1982, the Special Officer, Urban Development Authority, LAO, had unilaterally observed that the acquisition cannot be said to be in violation of the provisions contained in .....

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..... that an award had been passed on 30.11.1982 in accordance with Section 11 of the Land Acquisition Act. On the strength of the aforesaid notices it was urged on behalf of the Society that the limitation to seek the reference would commence from the date of receipt of the notices issued and received on 31.12.1988. The reference sought was within the period of limitation. 15. Reliance has been placed on the decision of this Court in Madan and Anr. v. State of Maharashtra [(2014) 2 SCC 720] and in Raja Harish Chandra Raj Singh v. The Deputy Land Acquisition Officer and Anr. [AIR 1961 SC 1500] in which it has been laid down that the party must have either actual or constructive communication of the order which is an essential requirement of fair play and natural justice. The date of award used in proviso (b) to Section 18(2) of the Act must be the date when the award is either communicated to the party or known by him either actually or constructively. The award in the said case was passed on 25.3.1951. Notice of the award was however given to the Appellant as required by Section 12(2) on 13.1.1953 by which he received information about making of the said award. It was observed that .....

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..... within one year from the date of the order. It is significant that while providing for a similar period of limitation Section 33(1) specifically lays down that the limitation of sixty days therein prescribed is to be calculated from the date on which the order in question is communicated to the Assessee. In other words, in prescribing limitation Section 33(1) expressly provides for the commencement of the period from the date of the communication of the order, whereas Section 33A(2) does not refer to any such communication; and naturally the argument was that communication was irrelevant Under Section 33A(2) and limitation would commence as from the making of the order without reference to its communication. This argument was rejected by the Bombay High Court and it was held that it would be a reasonable interpretation to hold that the making of the order implies notice of the said order, either actual or constructive, to the party affected by it. It would not be easy to reconcile this decision and particularly the reasons given in its support with the decision of the same High Court in the case of Jehangir Bomanji, AIR 1954 Bom. 419. The relevant clause Under Section 33A(2) of th .....

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..... hich the award was passed on 30.11.1982 as notice to it was wholly unnecessary in view of rejection of its objection on the ground that it was not having right, title or interest in the land. Thus it could not be said to be 'person interested' in view of the order dated 4.9.1982. The notice was issued for reasons best known to the Special Officer. It is surprising how and for what reasons notice was issued after six years. We need not go into this aspect any further as we are of the opinion that in the facts and circumstances, the Society had a constructive notice of the award dated 30.11.1982. Thus, in view of the conjoint reading of Sections 12(2) and 18(2) of the Rajasthan Land Acquisition Act, it was not open to the LAO to refer the case to the civil court on the basis of the time barred application. 19. Coming to the question whether in view of Section 42 of the Rajasthan Tenancy Act, the transaction entered into by the Society with the original Khatedars are void and whether on that basis, it had a right to maintain the reference and to claim compensation? The Society is said to have entered into agreements to sell on 17.2.1974, 21.2.1974 and 21.2.1976. These agree .....

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..... Rajasthan Tenancy Act is extracted hereunder: Section 42-General restrictions on sale, gift bequest [The sale, gift or bequest by a Khatedar tenants of his interest in the whole or part of his holding shall be void, if [***] (b) such sale, gift or bequest is by a number of Scheduled Caste in favour of a person who is not a member of the Scheduled Caste, or by a member of a Scheduled Tribe in favour of a person who in not a member of the Scheduled Tribe. [***] [(bb) such sale, gift or bequest, notwithstanding anything contained in Clause (b), is by a member of Saharia Scheduled Tribe in favour of a person who is not a member of the said Saharia tribe. ]4 21. The so-called agreements dated 15.2.1974, 17.2.1974, 21.2.1974 and 21.2.1976 which were purportedly entered into by the Society with the Khatedars were thus clearly void as per the mandate of Section 42 of the Rajasthan Tenancy Act. The notification in the instant case Under Section 4 was issued on 12.1.1982. The plea of part-performance Under Section 53A of Transfer of Property Act was also not available to the Society as transaction is void. 22. The equally futile is the submission that since the Soc .....

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..... stic person is ab initio void and not recognisable in the eye of law. 23. This Court in Manchegowda and Ors. v. State of Karnataka and Ors. [(1984) 3 SCC 301] has considered the validity of Sections 3, 4 and 5 of the Karnataka Scheduled Castes and Scheduled Tribes (Prohibition of Transfer of Certain Lands) Act, 1978 which prohibited transfer of granted lands and provided for resumption thereof, it was held that even the prohibited transaction effected prior to commencement of the Act can be nullified and Sections 4 and 5 are not violative of Article 19(1)(f) as it stood prior to its omission in 1978. Neither the provision is violative of Articles 31 and 31A of the Constitution of India and a transferee shall have no property right and recovery of such property would not attract Article 31 or 31A. This Court also held that the provisions have reasonable nexus with the object sought to be achieved. The Scheduled Castes and Scheduled Tribes form a distinctive class. Exclusion of other communities from the provision is not discriminatory. The right of the Legislature to declare such transactions to be void has been upheld by this Court in following manner: 12. In pursuance of thi .....

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..... f the provisions contained in Sections 4 and 5 resuming the land without compensation has been upheld. In Manchegowda (supra), this Court has laid down thus: 19. We have earlier noticed that the title which is acquired by a transferee in the granted lands, transferred in contravention of the prohibition against the transfer of the granted lands, is a voidable title which in law is liable to be defeated through appropriate action and possession of such granted lands transferred in breach of the condition of prohibition could be recovered by the grantor. The right or property which a transferee acquires in the granted lands, is a defeasible right and the transferee renders himself liable to lose his right or property at the instance of the grantor. We have further observed that by the enactment of this Act and particularly Section 4 and Section 5 thereof the Legislature is seeking to defeat the defeasible right of the transferee in such lands without the process of a prolonged legal action with a view to speedy resumption of such granted lands for distribution thereof the original grantee or their legal representatives and in their absence to other members of the Scheduled Castes .....

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..... purchase the same, is aware of the consequences of the provision carved out in order to protect weaker sections of Scheduled Castes and Scheduled Tribes. The right to claim compensation accrues from right, title or interest in the land. When such right, title or interest in land is inalienable to non-SC/ST, obviously the agreements entered into by the Society with the Khatedars are clearly void and decrees obtained on the basis of the agreement are violative of the mandate of Section 42 of the Rajasthan Tenancy Act and are a nullity. Such a prohibited transaction opposed to public policy, cannot be enforced. Any other interpretation would be defeasive of the very intent and protection carved out Under Section 42 as per the mandate of Article 46 of the Constitution, in favour of the poor castes and downtrodden persons, included in the Schedules to Articles 341 and 342 of the Constitution of India. 26. In State of Madhya Pradesh v. Babu Lal and Ors. [1977 (2) SCC 435] the provisions contained in Section 165(6) of M.P. Land Revenue Code, 1959 came up for consideration before this Court. The High Court directed the State to file a suit for declaring the decree null and void. The dec .....

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..... able of being alienated voluntarily and is sought to be recognized by doctrine of adverse possession as having been alienated involuntarily, by default and inaction on the part of the rightful claimant.... This Court then noticed two decisions one that of the Privy Council reported in AIR 1923 P.C. 205 Madhavrao Woman Saundalgekar and Ors. v. Raghunath Venkatesh Deshpande and Ors., and Karimullakhan s/o. Mohd. Ishaqkhan and Anr. v. Bhanupratapsingh, holding that title by adverse possession on inam lands, Watan lands and Debutter was incapable of acquisition since alienation of such land was prohibited in the interest of the State. We further find that the decision in the case of Madhiya Nayak (supra) relied upon by the High Court was referred to before this Court and it is observed that the question as to whether a non-tribal could at all commence prescribing acquisition of title by adverse possession over the land belonging to a tribal which is situated in a tribal area, was neither raised nor that point had arisen in the case of Madhiya Nayak. It is further observed that the provisions of Section 7-D of the Regulations are to be read in the light of the fact that the acquisiti .....

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..... perty in a tribal and vesting the same in a non-tribal, would be included within the meaning of 'transfer of immovable property'. 29. It was further submitted on behalf of the Society that though a purchaser after issuance of notification Under Section 4(1) of the Land Acquisition Act cannot question the legality of the notification, but, can lay a claim for payment of compensation. Reliance has been placed on U.P. Jal Nigam, Lucknow through its Chairman and Anr. v. Kalra Properties (P) Ltd., Lucknow and Ors. [1996 (3) SCC 124]. When we consider the aforesaid dictum, this Court has laid down that after notification Under Section 4(1) was published, sale of land is void against the State and M/s. Kalra Properties acquired no right, title or interest in the land and it is a settled law that it cannot challenge the validity of the notification or the regularity in taking possession of the land before publication of the declaration Under Section 6. M/s. Kalra Properties, though acquired no title to the land, at best would be entitled to step into the shoes of the owner and claim compensation. However, in the instant case, it was a transaction which was not only void against .....

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..... argava and Ors. JT (1995) 6 SC 274. 16. Similarly, in U.P. Jal Nigam v. Kalra Properties Pvt. Ltd., AIR 1996 SC 1170, this Court held that, purchase of land after publication of a Section 4 notification in relation to such land, is void against the State and at the most, the purchaser may be a person-interested in compensation, since he steps into the shoes of the erstwhile owner and may therefore, merely claim compensation. (See also: Star Wire (India) Ltd. v. State of Haryana and Ors. 17. In Ajay Kishan Singhal v. Union of India, AIR 1996 SC 2677; Mahavir and Anr. v. Rural Institute, Amravati and Anr., (1995) 5 SCC 335; Gian Chand v. Gopala and Ors., (1995) 2 SCC 528; and Meera Sahni v. Lieutenant Governor of Delhi and Ors., (2008) 9 SCC 177, this Court categorically held that, a person who purchases land after the publication of a Section 4 notification with respect to it, is not entitled to challenge the proceedings for the reason, that his title is void and he can at best claim compensation on the basis of vendor's title. In view of this, the sale of land after issuance of a Section 4 notification is void and the purchaser cannot challenge the acquisition proceedings .....

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..... ument purporting to transfer or sublet, the whole or any part of his holding otherwise than in accordance with the provisions of this Act and the transferee or sub-lessee or the purported such part in pursuance of such transfer or sub lease, both the tenant and any person who may have thus obtained or may thus be in possession of the holding or any part of the holding, shall on the application of the land holder, be liable to ejectment from the area so transferred or sub-let or purported to be transferred or sub-let. (2) To every application, under this Section the transferee or the sub-tenant or the purported transferee or the sub-tenant, as the case may be, shall be joined as a party. (3) On an application being made under this section, the court shall issue a notice to the opposite party to appear within such time as may be specified therein and show cause why he should not be ejected from the area so transferred or sublet or purported to be transferred or sub-let.] (4) If appearance is made within the time specified in the notice and the liability to ejectment is contested, the court shall, on payment of the proper court fees, treat the application to be a suit and pro .....

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..... g the process Under Section 175 of the Rajasthan Tenancy Act as much before passing of the decrees by the civil court in the year 1986, possession had been taken by the State in May, 1982 much before limitation lapsed. Thus, institution of proceedings for ejectment was not warranted. 37. In Ram Karan (dead) through LR and Ors. v. State of Rajasthan and Ors. [2014 (8) SCC 282], this Court has laid down that transfer of holding by a member of Scheduled Caste to a member not belonging to Scheduled Caste by virtue of Section 42 of the Rajasthan Tenancy Act is forbidden and unenforceable. Such a transaction is unlawful even Under Section 23 of the Contract Act and an agreement or such transfer would be void Under Section 2(g) of the Contract Act. This Court also considered limitation for filing ejectment Under Section 175. The proceeding filed after 31 years was held to be barred by limitation. The decision is distinguishable for aforesaid reasons. 38. It was next contended on behalf of the Society that the Society has acquired a right and such right to hold property cannot be taken away except in accordance with the provisions of a statute. If a superior right to hold the propert .....

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..... taking possession Under Article 300-A. In other words, if there is no law, there is no deprivation. 40. In Rajendra Nagar Adarsh Grah Nirman Sahkari Samiti Ltd. v. State of Rajasthan and Ors. [2013 (11) SCC 1] and Mathew Varghese v. M. Amritha Kumar and Ors. [2014 (5) SCC 610], observations as to the similar effect had been made. 41. When we consider the aforesaid submission, it is apparent that the right to hold property cannot be taken away except in accordance with the provisions of the statute but in the instant case, we are of the considered view that the right to hold property albeit had not been acquired by the Society, transaction was ab initio void and a nullity. On the other hand, the land has been acquired by the State Government and even the right to claim compensation was denied to the Society in the award passed on 30.11.1982 by rejecting their objections. The recourse to Section 175 was not required as already held by us. The question of entitlement of the Society is involved in the cases in view of award dated 30.11.1982 rejecting right of the Society to claim compensation. Thus, it cannot be said that there is violation of the principles laid down by this Cou .....

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..... confer any right on the Society or the Khatedars to claim the developed land. It was not a case of surrender of land; thus there was no question of the provisions of the circular being applied as the circular was in the form of guidelines for future acquisitions where Khatedars surrendered their lands and award has not been passed. For the aforesaid reasons, the aforesaid circular could not have been pressed into service by the Society and that too at the appellate stage before the Division Bench. The Division Bench has gravely erred in law while issuing the aforesaid directions which were wholly unwarranted and uncalled for. 47. When we consider the decision in Smt. Ratni Devi (supra), it was based upon a concession made by the counsel who appeared on behalf of the Jaipur Development Authority. The applicability of the Circular was not considered by the Division Bench. The matter was decided on the basis of concession and the agreement between the parties. It was submitted before us on behalf of the Rajasthan Housing Board that a review petition had been preferred for recalling the aforesaid concession made unauthorisedly before the court. Be that as it may. In our opinion, th .....

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..... ication of the declaration Under Section 6, the extent of the land with specified demarcation gets crystallised as the land needed for a public purpose. If the enquiry Under Section 5-A was dispensed with, exercising the power Under Section 17(1), the Collector on issuance of notice Under Sections 17, 9 and 10 is entitled to take possession of the acquired land for use of public purpose. Even otherwise on making the award and offering to pay compensation he is empowered Under Section 16 to take possession of the land. Such land vests in the Government free from all encumbrances. The only power for the Government Under Section 48 is to denotify the lands before possession is taken. Thus, in the scheme of the Act, the Land Acquisition Officer has no power to create an encumbrance or right in the erstwhile owner to claim possession of a part of the acquired land in lieu of compensation. Such power of the Land Acquisition Officer if is exercised would be self-defeating and subversive to public purpose. 13. The Court in Radhey Shyam case (supra) also considered the question whether the Appellant could challenge the award in the execution proceedings and answered the same in the aff .....

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..... the Minister would bind the Government. The actions, therefore, taken by the Minister-cum-Chairman of the appellate authority and bureaucrats for obvious reasons would not clothe the Respondents with any vestige of right to allotment. Acceptance of the contentions of the Respondents would be fraught with dangerous consequences. It would also bear poisonous seeds to sabotage the schemes defeating the declared public purpose. The record discloses that such allotment in many a case was in violation of the Urban Land Ceiling Act which prohibits holding the land in excess of the prescribed ceiling limit of the urban land. In some instances, a person whose land of 500 sq. yd. was acquired, was compensated with allotment of 2000 sq. yd. and above, which is against the public policy defeating even the Urban Land Ceiling Act. Would any responsible Minister or a bureaucrat, with a sense of public duty and responsibility, transfer such land to sabotage the planned development of the scheme? Answer has obviously to be in the negative. The necessary inference is that the policy does not bear any insignia of a public purpose, but appears to be a device to get illegal gratification or distributi .....

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..... possession was not given. He listed various cases pending in this Court and the High Court and executing court in respect of other cases. It is clear from the record that as and when any person had gone to the court to get the orders of the LAO enforced, the Appellant Authority resisted such actions taking consistent stand and usually adverse orders have been subjected to decision in various proceedings. Therefore, no blame of inaction or favouritism to others can be laid at the door of the present set-up of the Appellant Authority. When the Minister was the Chairman and had made illegal allotments following which possession was delivered, no action to unsettle any such illegal allotment could have been taken then. That apart, they were awaiting the outcome of pending cases. It would thus be clear that the present set-up of the bureaucrats has set new standards to suspend the claims and is trying to legalise the ultra vires actions of Minister and predecessor bureaucrats through the process of law so much so that illegal and ultra vires acts are not allowed to be legitimised nor are to be perpetuated by aid of Article 14. That apart, Article 14 has no application or justification t .....

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..... be specified in rules to be made by the Governor, and the validity of an order or instrument which is so authenticated shall not be called in question on the ground that it is not an order or instrument made or executed by the Governor. (3) The Governor shall make rules for the more convenient transaction of the business of the Government of the State, and for the allocation among Ministers of the said business insofar as it is not business with respect to which the Governor is by or under this Constitution required to act in his discretion. 15. Article 166(1) requires that all executive action of the State Government shall be expressed to be taken in the name of the Governor. This clause relates to cases where the executive action has to be expressed in the shape of a formal order or notification. It prescribes the mode in which an executive action has to be expressed. Noting by an official in the departmental file will not, therefore, come within this article nor even noting by a Minister. Every executive decision need not be as laid down Under Article 166(1) but when it takes the form of an order it has to comply with Article 166(1). Article 166(2) states that orders and .....

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..... Hari Ram and Anr. v. State of Haryana and Ors. [2010 (3) SCC 621] relied upon on behalf of the Society in which this Court considered passing of different orders, in respect of persons similarly situated, relating to same acquisition proceedings. The action was held to be violative of Article 14 being discriminatory. There is no doubt about it that different standards cannot be applied for withdrawal from acquisition. The present is not such a case. The circular is not applicable. We cannot direct the State to act upon the circulars which are not applicable. Under the Code that all actions of the State are to be fair and legitimate, we cannot create negative equality and confer a benefit that too on the strength of a concessional statement which is not provided by circular. Concession made by the counsel in Ratni Devi's case (supra) cannot widen scope of circular. 54. We may also refer to other decisions relied upon in Usha Stud and Agricultural Farms Pvt. Ltd. and Ors. v. State of Haryana and Ors. [2013 (4) SCC 210] laying down that once a State Government has taken a conscious decision to release the land, there would be no justification whatsoever for the State for not a .....

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..... ₹ 150/- per sq. yds. and the land situated in gram panchayat Bhagyawas, Ex. 8 agreement dated 5.5.1979 of 34,000 sq.yds. @ ₹ 90-94 per sq. yds. 57. It also considered oral evidence in detail and has not relied upon the same and has arrived at the average price to be ₹ 135 per sq.yd. making certain deduction as large area has been acquired. In case area in question had been developed, certain area was bound to go in the development. Thus, deduction which has been made to arrive at the figure of ₹ 100 per sq.yd. is proper. We find in the facts and circumstances of the case that the finding arrived at by the single Bench to be appropriate. No doubt about it. Oral evidence can also be taken into consideration but in the facts of this case, the best evidence is documentary evidence which has to prevail. In the face of the documentary evidence evincing the price of the land per sq.yd. the oral evidence which was based upon ipse dixit and without any sound basis, could not have been accepted by the Reference Court. Thus, the grave error which was committed had been rightly set at naught by the single Bench of the High Court, which determination of compensation h .....

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..... ght of downtrodden class of the Scheduled Castes Khatedars cannot be prolonged and considering the provisions which have been enacted for their protection, and the constitutional mandate, we are inclined to exercise our power to set at rest the dispute between the parties and hold that only Khatedars, in case some of them have died, their legal representatives would be entitled to receive the compensation which has been determined in the instant case. 61. In order to protect the interest of the Scheduled Caste persons, we further direct that the Society or other intermeddler, or power of attorney holder shall not be paid compensation on their behalf and the Collector/Land Acquisition Officer to ensure that the compensation is disbursed directly to the Khatedars or their legal representatives, as the case may be, and that they are not deprived of the same by any unscrupulous devices of land grabbers etc. Let the compensation be disbursed within a period of three months from today along with other permissible statutory benefits. 62. The direction issued by the High Court to grant 25% of the developed land is hereby set aside. The appeals preferred by the Rajasthan Housing Board .....

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