APHC010526372013 IN THE HIGH COURT OF ANDHRA PRADESH (Special Original Jurisdiction) THURSDAY, THE TWO THOUSAND AND TWENTY THE HONOURABLE SRI JUSTICE NINALA JAYASURYA THE HONOURABLE SRI LAND ACQUISITION APPEAL Between: The Revenue Divisional Officer Chatakonda Ramaswamy Counsel for the Appellant: 1. GP FOR APPEALS Counsel for the Respondent: 1. The court made the following 1. The Land Acquisition Appeal Suit arose out of the Common Order, dated 11.12.2012, passed in LAOP.No Nos.48, 50, 51 and 52 of 2011, Judge, Nandhyal (hereinafter referred to as "Reference Court") whereby the compensation for the land acquired was enhanced from Rs.23, Rs.81,000/- per Acre. IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI (Special Original Jurisdiction) THE THIRTEENTH DAY OF FEBRUARY TWO THOUSAND AND TWENTY-FIVE PRESENT THE HONOURABLE SRI JUSTICE NINALA JAYASURYA AND THE HONOURABLE SRI JUSTICE T. MALLIKARJUNA RAO LAND ACQUISITION APPEAL SUIT NO: 254/2013 The Revenue Divisional Officer ...APPELLANT AND ...RESPONDENT Counsel for the Appellant: Counsel for the Respondent: made the following JUDGMENT: (per Hon’ble Sri Justice T. Mallikarjuna Rao) The Land Acquisition Appeal Suit arose out of the Common Order, d 11.12.2012, passed in LAOP.No.49 of 2011 and batch of L.A.O.P. Nos.48, 50, 51 and 52 of 2011, on the file of learned II Additional Senior Civil Judge, Nandhyal (hereinafter referred to as "Reference Court") whereby the compensation for the land acquired was enhanced from Rs.23, IN THE HIGH COURT OF ANDHRA PRADESH [3495] THIRTEENTH DAY OF FEBRUARY THE HONOURABLE SRI JUSTICE NINALA JAYASURYA MALLIKARJUNA RAO ...APPELLANT ...RESPONDENT (per Hon’ble Sri Justice T. Mallikarjuna Rao) The Land Acquisition Appeal Suit arose out of the Common Order, of L.A.O.P. learned II Additional Senior Civil Judge, Nandhyal (hereinafter referred to as "Reference Court") whereby the compensation for the land acquired was enhanced from Rs.23,700/- to 2 2. For convenience, the Parties will be hereinafter referred to as per their ranking in the Reference Court. 3. The Government issued a Notification under Section 4(1) of the Land Acquisition Act, 1894 (hereinafter referred to as 'the Act') dated 16.05.1997. The Land Acquisition Officer fixed the market value of the lands at Rs.23,700/- per acre vide Award No.3/1998-99 dated 04.05.1998. 4. Dissatisfied with the compensation awarded in Award No.3/1998-99 dated 04.05.1998, passed by the Land Acquisition Officer, several Land Owners submitted references under Section 18 of the Act. This reference was adjudicated by the Common Order dated 11.12.2012 in leading LAOP.No.49 of 2011 and batch before the learned II Additional Senior Civil Judge, Nandyal. The Reference Court enhanced the market value of the acquired land from Rs.23,700/- to Rs.81,000/- per Acre. 5. Aggrieved by the common order in L.A.O.P. No.48 of 2011, the Appellant/Referring Officer filed the present First Appeal. 6. Briefly stated facts of the present appeal for referring to matters by the Land Acquisition Officer, Nandyal, to the Civil Court under Section 18 of the Act are as follows: (a) The Revenue Divisional Officer-cum-Land Acquisition Officer, Nandyal, acquired 18.97 acres of land across various survey numbers in Tangatur Village, Banaganapalli Mandal, from the Claimants for the construction of an S.S. Tank and Headworks under the C.P.W.S. Scheme. This was done in Award No.3/1998-99, dated 04.05.1998, following the issuing of a draft notification under Section 4(1) of the Act. (b) To determine the true market value of the acquired lands, the Land Acquisition Officer reviewed the sale statistics of land registered in Tangatur Village over the past three years from the last date of notification. Among 91 sales during this period, Item Nos. 4, 6, 35, 48, 62, 87, and 88 were identified 3 as significant sales. Notably, in Survey No. 284/2, an extent of Ac.0.99 cents was sold for Rs.23,400/-, which results in a rate of Rs.23,636/- per acre. Hence, the sale in Survey No. 284/2 is reasonable for determining the market value of the acquired lands, considering factors like fertility, cropping pattern, and maintenance. Consequently, the market value was fixed at Rs. 23,700/- per acre, with a 12% additional market value and a 30% solatium. However, the claimants accepted this compensation under protest and requested the Land Acquisition Officer to refer the matter to the Civil Court under Section 18 of the Act for compensation enhancement. 7. In their respective OPs, the claimants argued that the compensation set by the LAO was inadequate, unjustified, and failed to adhere to the principles outlined in Section 23 of the Act. They claimed that the LAO did not consider the potential of the acquired lands, comparable sales, or apply individual discretion in determining the compensation. The claimants emphasized that the compensation amount was too low, and no clear principles were followed in fixing the market value. As agriculturists who solely relied on the income from the acquired lands, the claimants highlighted their dependence on the land for their livelihood. 8. Based on the above pleadings, the Reference Court framed the following points: (1) Whether the market value fixed by the Land Acquisition Officer under award is just and reasonable or needs any enhancement, if so, what is the proper estimate of the market value of the acquired lands? (2) To what relilef? 9. During the common enquiry to substantiate the Claimants’ claim, the Claimant in LAOP.No.49/2011 was examined as R.W.1 and another witness as R.W.2 and marked Ex.B1-certified copy of the registered sale deed dated 4 12.08.1994. The Land Acquisition Officer/Referring Officer was examined as P.W.1 and got marked Ex.A1-copy of Award No.3/1998-99 dated 04.05.1998. 10. After the completion of the trial and hearing the arguments of both sides, the Reference Court enhanced the compensation amount from Rs.27,000/- to Rs.81,000/- per Acre. Consequently, awarded 30% solatium on the enhanced market value fixed as provided under Section 23(2) of the Act; additional market value @ 12% per annum on such market value from the date of Sec.4(1) Notification of the Act till the date of award; also awarded interest at 9% per annum for one year from the date of taking possession thereafter at 15% per annum till the date of payment on enhanced market value and also entitled to interest on additional market value and solatium. 11. 11. Sri T. Srinivasa Rayalu, Learned Government Pleader for Appeals representing the Appellant, argued that the Reference Court's decision to enhance the compensation lacked basis and evidence. He contended that the Reference Court failed to consider the oral and documentary evidence presented in the case. Specifically, he pointed out that the court improperly relied on Ex.B1-Sale Deed from a different village, despite available sale transactions from the village where the land was acquired. The sale transactions in the present village showed a lower value, suggesting the market value was not Rs.81,000/- per acre. Additionally, he argued that the Reference Court erred in granting escalation without evidence of rising land values in the vicinity and that the enhancement made by the learned Judge was excessive and exorbitant. 12. Concerning the pleadings in the Original Petition, the findings recorded by the Reference Court and in light of the rival contentions, the following points would arise for determination: 1) Is the market value of the acquired land determined by the Reference Court lawful and adequate? 2) Does the Order of the Reference Court need any interference? 5 POINT NO.1: 13. It is not in dispute that the Revenue Divisional Officer (Land Acquisition), Nandyal, had acquired land of an extent of Ac.18.97 cents in various survey numbers of Tangutur village, Banaganapalli Mandal, for the construction of S.S. Tank and Head Works in Tangutur village under C.P.W.S. scheme in Award No.3/1998-1999, dated 04.05.1998 by issuing the Draft Notification Under Section 4 (1) of the Land Acquisition Act, which was published in the A.P.Gazette Part-I, Extraordinary issue on 16.05.1997 at 2 and 3 pages respectively. The Draft Declaration was published in A.P.Gazette Part-I, Extraordinary Issue, dated 02.06.1997. The 5A Telugu Notification has been published in two Telugu daily newspapers. The substance of the notification has been published in the village on 20.06.1997. 14. The first factor provided in Section 23(1) of the Act specifically provides that for determining the amount of compensation to be awarded for land acquired under the Act, the court shall take into consideration the market value of the land at the date of publication of the notification in the Gazette under Section 4(1) of the Act. Thus, the court must determine the market value of land acquired under the Act as of the publication date of the Notification publication in the Gazette under Section 4(1) of the Act. This view is supported by the law laid down by the Hon'ble Supreme Court in the case of Chamanlal Hargovind Das V. S.L.A.O. 1 , Union of India vs. Dyagala Devamma and others2, Manoj Kumar and others V. State of Haryana and others3. 15. Given the law laid down by the Hon'ble Supreme Court in the case of Chamanlal Hargovind Das V. S.L.A.O. 4 , Bhupal Singh Vs. State of Haryana,5 Manoj Kumar and others (supra), Union of India V. Dyagala 1 (1988) 3 SCC 751 2 (2018) 8 SCC 485 3 (2018) 13 SCC 96 4 (1988) 3 SCC 751 5 (2015) 5 SCC 801 6 Devamma and others6 and Bhupal Singh V. State of Haryana and others7, the Hon'ble Supreme Court specifically considered a similar question of determination of market value under Section 23 of the Act and held that the market value of the acquired land is required to be determined based on the market rate of the adjacent land similarly situated to the acquired lands prevailing on the date of acquisition or/and before the acquisition but not subsequent to the date of acquisition. 16. On behalf of the Claimants, the Claimant in L.A.O.P. No.49 of 2011 is examined as RW.1. According to his testimony, the Land Acquisition Officer (LAO) himself acknowledged in the award that the lands under acquisition are dry, rain-fed lands. RW.1 further testified that crops such as cotton, red gram, and sunflower are cultivated on the land, and the soil is of a black cotton variety, which is highly fertile. Additionally, the acquired lands are located near the village, adjacent to the Banaganapalle-Nandyal R & B road. Despite these factors, the LAO determined the market value to be Rs.23,700/- per acre. In support of this assertion, the RW.1 submitted Ex.B.1, a certified copy of a registered sale deed dated 12.08.1994, executed by Chinna Jagannadham of Nandavaram village, which documents the sale of Ac.1.00 cents of land in Survey No.22 located in Sankalapuram village, Banaganapalli Mandal, at a rate of Rs. 61,000/- per acre. 17. To substantiate the aforementioned sale transaction, the claimant examined RW.2, Yerasu Ramakrishna Reddy, who testified that he purchased the property covered under Ex.B.1 on 12.08.1994. Both RWs.1 and 2 stated that the lands described in Ex.B.1 are comparable in nature, potential, and market value to the acquired lands. No material was brought forth during cross-examination to challenge the credibility of the testimonies provided by RWs.1 and 2. Moreover, the Land Acquisition Officer (LAO) failed to adduce either oral or documentary evidence to refute the claimant’s assertions except relying on Ex.A.1 Award. 6 (2018) 8 SCC 485 7 (2018) 13 SCC 96 7 18. The evidence provided by RW.2, along with the Ex.B.1 document, strongly indicates that the transaction in question was bona fide. The Land Acquisition Officer (LAO) has not adduced any evidence to challenge the validity of this transaction. Furthermore, the sale pertains to land that is comparable to the land being acquired, reinforcing the credibility and relevance of the transaction. 19. When a document of the same village is available, it is permissible and desirable to consider the said sale transaction. If the document is of a neighbouring village or at the same land abutting the land that has been acquired, then it can be taken into account. So, the distance also has to be considered while considering the neighbouring village's documents. 20. The testimony of RW.1 reveals that the distance between the land shown in Ex.B.1 and the acquired land is approximately half a kilometre, while the distance between the two villages is around four kilometres. Although the award has been marked, none of the sale transactions referenced in the award were produced as evidence. As such, the Reference Court is not supposed to consider these transactions. Only when the documents referred to in the award are formally marked, the Court gains the authority to review them. Since the documents referenced in the award were not marked, the Reference Court had no opportunity to examine or take them into account. 21. In Manipur Tea Co. Pvt. Ltd. V. Collector of Hailkandi8, the Hon’ble Supreme Court held that: The sale statistics relied on by the Land Acquisition Officer are not proof unless persons connected with the sale deeds and the documents made part of the record are examined. Therefore, the sales statistics cannot ipso facto form a basis to determine the compensation. 22. In Revenue Divisional Officer V. Raja J.Rameswara Rao 9 , the Hon’ble Supreme Court held that: 8 1997 0 AIR(SC) 1779 9 1992 2 ALT 565 8 (8)……………………………. It is a well-settled proposition that even sale statistics mentioned in the award cannot be considered unless they are produced, marked and proved through a competent witness. The same is the case here. 23. The learned Reference Court placed reliance on the decision in Union of India V. Bal Ram and another10, in which the Hon’ble Supreme Court held that the determination of the market value of the land on the basis of comparable instances of sale acquired in different villages could be taken into consideration for fixing the market value. 24. In Ali Mohammad Beigh v. State of Jammu & Kashmir11, the claim for higher compensation was made based on the value of adjacent lands. The Hon'ble Supreme Court noticed that the concerned villages are situated adjacent to each other and share a common border/boundary with each other. The interse distance between these villages is not much. The Hon'ble Supreme Court observed that the lands are more or less near. When the acquired lands are identical and similar, and acquisition is for the same purpose, it would not be proper to discriminate between the land owners unless there are strong reasons (paragraph No. 12). 25. The Reference Court has relied on the Ex.B.1 sale deed, having been satisfied that the lands acquired in the present case and the land shown in Ex.B.1 possess similar potential and characteristics. In the absence of any other direct evidence to establish the market value of the land under acquisition, the sale transaction documented in Ex.B.1 can be considered as a basis, particularly due to the proximity of the locations. The Reference Court concluded that the Ex.B.1 sale transaction is a valid reference for determining the market value of the acquired land and, accordingly, fixed the value of the acquired land at Rs. 61,000/- per acre. 10 2004 0 AIR(SC) 3981 11 (2017) 4 SCC 717 9 26. In the absence of contemporaneous documents directly related to the acquired lands, the Reference Court was justified in considering the sale deed from a neighbouring village to determine the market value of the lands in question. Given that the Reference Court is required to rely on a sale transaction that occurred approximately two years and nine months prior, it is essential to account for the appreciation in land prices when determining the market value as of the date of the notification. We are of the view that the Reference Court followed the correct procedure by thoroughly examining the location and potential value of the acquired lands in reaching its decision. 27. In Om Prakash v. Union of India12, the Hon’ble Supreme Court held that: 11. ………Since no material was placed on record to show that there was any abnormality during the period, the High Court applied the same principle to the facts and circumstances before it and accepted an increase of 10% every year progressively from 1963 to 1973 and thereafter @ 12% every year progressively up to the date of acquisition. ………….. 12. Having heard the learned counsel and perused the judgment, we find it difficult to disagree with the exercise carried out by the High Court. We think that the High Court was justified in assessing the market value at a higher rate on account of some increased potentiality of the lands. ……………….. 28. In Krishi Utpadan Mandi Samiti Sahaswom V. Bipin Kumar13, the Hon’ble Supreme Court had accepted an escalation of 15% per annum. 29. Allowing an escalation of land prices at 10% per year has been recognized by the Courts as a reasonable approach for determining market value; however, this principle is not an absolute rule. In particular, where the evidence on record suggests that the land under acquisition had significant potential and there is a clear scope for an increase in land prices between the date of the sale transaction relied upon by the claimant and the date of the 12 (2004) 10 SCC 627 13 2004 (2) SCC 283 10 notification, the Reference Court is justified in assessing the escalation of land prices at 12% per year. 30. The sale transaction of Ex.B.1 occurred on 12.08.1994, while the Section 4(1) Notification was issued on 16.05.1997. Given the lack of evidence for comparable nearby sale transactions, the Reference Court found it essential to assess the land's value by considering the two-year and nine- month gap, alongside prevailing market trends. As a result, the Reference Court applied a 12% increase to the property's value, ultimately determining the land’s value at Rs.81,000 per acre. Accordingly, the Point is answered. POINT No.2: 31. After carefully reviewing the precedents cited, we firmly believe that the Reference Court has appropriately determined the market value following the judgments rendered by the Supreme Court. In light of the well-settled position, the argument put forth by the Government Pleader questioning increasing the compensation amount by 12% per annum is not sustainable. 32. We hold that the reasoning and basis adopted by the Reference Court in awarding compensation are sound and appropriate. Despite challenging the impugned order by the LAO and claimant on various grounds, they failed to substantiate their contentions. We find that the Reference Court approached the matter correctly, and after thorough consideration, we agree with the Reference Court's assessment of the evidence. The findings of the Reference Court are sound, and the Land Acquisition Officer has presented no valid grounds to alter the compensation amount awarded. Based on the preceding discussion, we see no reason to depart from the Reference Court's perspective. Accordingly, the Point is answered. 11 33. As a result, this appeal fails and is dismissed without costs. The Decree and Common Order, dated 11.12.2012, passed in L.A.O.P.No.48 of 2011 by the learned II Additional Senior Civil Judge, Nandyal, are affirmed. Miscellaneous pending applications, if any, shall stand closed. __________________________ JUSTICE NINALA JAYASURYA _____________________________ JUSTICE T. MALLIKARJUNA RAO Date: 13.02.2025 MS / SAK 12 THE HONOURABLE SRI JUSTICE NINALA JAYASURYA AND THE HONOURABLE SRI JUSTICE T. MALLIKARJUNA RAO LAAS No.254 of 2013 Date: 13.02.2025 S A K