- 1 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 24TH DAY OF NOVEMBER, 2025 PRESENT THE HON'BLE MRS. JUSTICE ANU SIVARAMAN AND THE HON'BLE MR. JUSTICE VIJAYKUMAR A. PATIL MISCELLANEOUS FIRST APPEAL NO.8424/2022 (LAC) C/W MISCELLANEOUS FIRST APPEAL NO.8416/2022 (LAC) MISCELLANEOUS FIRST APPEAL NO.8422/2022 (LAC) IN M.F.A. No.8424/2022: BETWEEN: THE SPECIAL LAND ACQUISITION OFFICER KOLAR SUB DIVISION KOLAR. &APPELLANT (BY SMT. PRATHIBHA R.K. AGA) AND: SMT. SHASHIKALA .K W/O GOPALAKRISHNA AGED ABOUT 42 YEARS R/AT. NO.207, 7TH CROSS NANJAREDDY COLONY HAL POST, BENGALURU 17 &RESPONDENT (BY SRI. Y.R. SADASIVA REDDY, SR. ADV., FOR SRI. RAHUL S. REDDY, ADV.,) - - - THIS MFA IS FILED U/S 54(1) OF LAND ACQUISITION ACT, PRAYING TO CALL FOR RECORDS IN LAC NO.4/2020 ON Digitally signed by RUPA V Location: High Court Of Karnataka - 2 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 THE FILE OF THE ADDL. SENIOR CIVIL JUDGE AND JMFC, KGF (ITINERATE AT BANGARPET) KOLAR DISTRICT. SET ASIDE THE JUDGMENT AND ORDER DATED 7.3.2022 PASSED IN LAC NO.4/2020 BY THE ADDL. SENIOR CIVIL JUDGE & JMFC AT KGF (ITINERATE AT BANGARPET) BY ALLOWING THE ABOVE APPEAL & ETC. IN M.F.A. NO.8416/2022: BETWEEN: THE SPECIAL LAND ACQUISITION OFFICER KOLAR SUB DIVISION KOLAR. ...APPELLANT (BY SMT. PRATHIBHA R.K. AGA) AND: SMT. LAKSHMAMMA W/O VENKATARAMAPPA AGED ABOUT 60 YEARS R/AT. DODDA ANKANDAHALLI VILLAGE KASABA HOBLI, BANGARPET TALUK KOLAR DISTRICT. ...RESPONDENT (BY SRI. Y.R. SADASIVA REDDY, SR. ADV., FOR SRI. RAHUL S. REDDY, ADV.,) - - - THIS MFA IS FILED U/S 54(1) OF LAND ACQUISITION ACT, PRAYING TO CALL FOR RECORDS IN LAC NO.1/2019 ON THE FILE OF THE ADDL. SENIOR CIVIL JUDGE AND JMFC, KGF (ITINERATE AT BANGARPET) KOLAR DISTRICT. SET ASIDE THE JUDGMENT AND ORDER DATED 7.3.2022 PASSED IN LAC NO.1/2019 BY THE ADDL. SENIOR CIVIL JUDGE & JMFC AT KGF (ITINERATE AT BANGARPET) BY ALLOWING THE ABOVE APPEAL & ETC. - 3 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 IN M.F.A. NO.8422/2022: BETWEEN: THE SPECIAL LAND ACQUISITION OFFICER KOLAR SUB DIVISION KOLAR. ...APPELLANT (BY SMT. PRATHIBHA R.K. AGA) AND: SRI. B.S. MANJUNATHA S/O LATE SHANKARAPPA AGED 57 YEARS R/A NO.1347, 1ST CROSS BANGARPET TALUK KOLAR DISTRICT. ...RESPONDENT (BY SRI. Y.R. SADASIVA REDDY, SR. ADV., FOR SRI. RAHUL S. REDDY, ADV.,) - - - THIS MFA IS FILED U/S 54(1) OF LAND ACQUISITION ACT, PRAYING TO CALL FOR RECORDS IN LAC NO.2/2019 ON THE FILE OF THE ADDL. SENIOR CIVIL JUDGE AND JMFC, KGF (ITINERATE AT BANGARPET) KOLAR DISTRICT. SET ASIDE THE JUDGMENT AND ORDER DATED 7.3.2022 PASSED IN LAC NO.2/2019 BY THE ADDL. SENIOR CIVIL JUDGE & JMFC AT KGF (ITINERATE AT BANGARPET) BY ALLOWING THE ABOVE APPEAL & ETC. THESE APPEALS, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MRS. JUSTICE ANU SIVARAMAN and HON'BLE MR. JUSTICE VIJAYKUMAR A. PATIL - 4 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 ORAL JUDGMENT (PER: HON'BLE MR. JUSTICE VIJAYKUMAR A. PATIL) These appeals have been filed by the Special Land Acquisition Officer, Kolar Sub-Division, Kolar, under Section 54(1) of the Land Acquisition Act, 1894 (hereinafter referred to as 'the Act', for short). 2. MFA No.8424/2022, MFA No.8416/2022 and MFA No.8422/2022 are filed challenging the judgments and awards dated 07.03.2022 passed in LAC Nos.4/2020, 1/2019 and 2/2019, respectively, by the Additional Senior Civil Judge and JMFC, KGF (Itinerate at Bangarpete). 3. The brief facts leading to filing of these appeals are that the State Government issued a preliminary notification under Section 4(1) of the Act and a final notification under Section 6(1) of the Act for acquisition of various extents of lands including the lands in question for the purpose of establishment of new Court Complex and residential quarters for the Judicial Officers at Bangarpete. - 5 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 The Special Land Acquisition Officer (SLAO) has determined the market value of the lands by passing the award. The respondents-land losers sought a reference under Section 18(1) of the Act, seeking for higher compensation. The Reference Court recorded the evidence of the claimants. The claimant in LAC No.4/2020 examined herself as PW-1 and got marked Exs.P1 to P28. The respondent examined RW-1 but did not produce any documentary evidence. The claimant in LAC No.1/2019 examined herself as PW-1 and got marked documents at Exs.P1 to P13. The respondent examined RW-1 but did not produce any documentary evidence. The claimant in LAC No.2/2019 examined himself as PW-1 and got marked Exs.P1 to P20. The respondents examined RW-1 but did not produce any documentary evidence. The Reference Court, after considering the pleading and evidence on record re-determined the market value at Rs.45,30,000/-, Rs.37,94,000/- and Rs.45,30,000/- in LAC.Nos.04/2020, - 6 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 1/2019 and 2/2019, respectively. Being aggrieved, the SLAO has preferred these appeals. 4. Smt.Prathibha R.K., learned Additional Government Advocate appearing for the appellants submits that the Reference Court has erred in properly appreciating the evidence adduced by the parties. It is submitted that the SLAO, considering the sale during the relevant period awarded a just compensation. However, the Reference Court, by incorrectly appreciating the evidence enhanced the compensation exorbitantly. It is further submitted that the sale deed of the year 2015 cannot be the basis to determine the market value in the year 2011. It is also submitted that the lands in question were the agricultural lands and the claimants were cultivating the same when the notifications were issued. However, the Reference Court, without any justifiable reason awarded compensation on square foot basis. Hence, she seeks to allow the appeals by setting aside the impugned orders. - 7 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 5. Per contra, Sri.Y.R.Sadasiva Reddy, learned Senior counsel appearing for the respondents-claimants supports the impugned judgments of the Reference Court and submits that the Reference Court, considering the material on record has rightly determined the market value which does not call for any interference. It is submitted that the acquired lands were situated very near to the RMC Yard, Bangarpete and the State Highway. It is further submitted that the surrounding area of the lands acquired was fully developed on the date of issuance of the preliminary notification. The lands are very near to fire station, Government First Grade College, Petrol Bunk, Kalyan Mantap and hence, the Reference Court has rightly considered the lands as non-agricultural potential and awarded just compensation which does not call for any reduction. Hence, he seeks to dismiss the appeals. 6. We have heard the arguments of the learned Additional Government Advocate appearing for the appellants, learned Senior counsel appearing for the - 8 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 respondents and perused the material available on record. We have given our anxious consideration to the submissions advanced on both the sides. 7. The point that arises for consideration in these appeals is: "Whether the impugned judgments and awards of the Reference Court call for any interference in these appeals?" 8. The answer to the above point is in the negative for the following reasons: (a) Before adverting to the facts involved in these appeals, it would be useful to refer to the relevant paragraphs of the decision of the Apex Court in CHIMANLAL HARGOVINDDAS vs. SPECIAL LAND ACQUISITION OFFICER, POONA & ANOTHER1, as under: "The following factors must be etched on the mental screen: 1 (1988) 3 SCC 751 - 9 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 (1) A reference under section 18 of the Land Acquisition Act is not an appeal against the award and the Court cannot take into account the material relied upon by the Land Acquisition officer in his Award unless the same material is produced and proved before the Court. 1. By Certificate under Article 133(l)(a) of the Constitution of India as it existed at the material time. (2) So also the Award of the Land Acquisition officer is not to be treated as a judgment of the trial Court open or exposed to challenge before the Court hearing the Reference. It is merely an offer made by the Land Acquisition officer and the material utilised by him for making his valuation cannot be utilised by the Court unless produced and proved before it. It is not the function of the Court to suit in appeal against the Award, approve or disapprove its reasoning, or correct its error or affirm, modify or reverse the conclusion reached by the Land Acquisition officer, as if it were an appellate court. (3) The Court has to treat the reference as an original proceeding before it and determine the market value afresh on the basis of the material produced before it. - 10 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 (4) The claimant is in the position of a plaintiff who has to show that the price offered for his land in the award is inadequate on the basis of the materials produced in the Court. Of course the materials placed and proved by the other side can also be taken into account for this purpose. (5) The market value of land under acquisition has to be determined as on the crucial date of publication of the notification under sec. 4 of the Land Acquisition Act (dates of Notifications under secs. 6 and 9 are irrelevant). (6) The determination has to be made standing on the date line of valuation (date of publication of notification under Section 4) as if the valuer is a hypothetical purchaser willing to purchase land from the open market and is prepared to pay a reasonable price as on that day. It has also to be assumed that the vendor is willing to sell the land at a reasonable price. (7) In doing so by the instances method, the Court has to correlate the market value reflected in the most comparable instance which provides the index of market value. (8) only genuine instances have to be taken into account. (Some times instances are rigged up in anticipation of Acquisition of land). - 11 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 (9) Even post notification instances can be taken into account (1) if they are very proximate,(2) genuine and (3) the acquisition itself has not motivated the purchaser to pay a higher price on account of the resultant improvement in development prospects. (10) The most comparable instances out of the genuine instances have to be identified on the following considerations: (i) proximity from time angle, (ii) proximity from situation angle. (11) Having identified the instances which provide the index of market value the price reflected therein may be taken as the norm and the market value of the land under acquisition may be deduced by making suitable adjustments for the plus and minus factors vis-a-vis land under acquisition by placing the two in juxtaposition. (12) A balance-sheet of plus and minus factors may be drawn for this purpose and the relevant factors may be evaluated in terms of price variation as a prudent purchaser would do. (13) The market value of the land under acquisition has there after to be deduced by loading the price reflected in the instance taken as norm for plus factors and unloading it for minus factors - 12 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 (14) The exercise indicated in clauses (11) to (13) has to be undertaken in a common sense manner as a prudent man of the world of business would do. We may illustrate some such illustrative (not exhaustive) factors: Plus factors Minus factors 1. smallness of size. 1. largeness of area. 2. proximity to a road. 2. situation in the interior at a distances from the Road. 3. frontage on a road. 3. narrow strip of land with very small frontage compared to death. 4. nearness to developed area. 4. lower level requiring the depressed portion to be filled up. 5. regular shape. 5. remoteness from developed locality. 6. level vis-a-vis land under 6. some special acquisition. disadvantageous factor which would deter a purchaser. 7. special value for an owner of an adjoining property to whom it may have some very special advantage. (15) The evaluation of these factors of course depends on the facts of each case. There cannot be any hard and fast or rigid rule. Common sense is the best and most reliable guide. For instance, take the factor regarding the size. A building plot of land say 500 to 1000 sq.yds. cannot be compared with a large tract or block of land of say l000 sq. yds or more. Firstly while a smaller plot is within the reach of - 13 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 many, a large block of land will have to be developed by preparing a lay out, carving out roads, leaving open space, plotting out smaller plots, waiting for purchasers (meanwhile the invested money will be blocked up) and the hazards of an entrepreneur. The factor can be discounted by making a deduction by way of an allowance at an appropriate rate ranging approx. between 20% to 50% to account for land required to be set apart for carving out lands and plotting out small plots. The discounting will to some extent also depend on whether it is a rural area or urban area, whether building activity is picking up, and whether waiting period during which the capital of the entrepreneur would be looked up, will be longer or shorter and the attendant hazards. (16) Every case must be dealt with on its own facts pattern bearing in mind all these factors as a prudent purchaser of land in which position the Judge must place himself. (17) These are general guidelines to be applied with understanding informed with common sense." Keeping in mind the broader guidelines laid down by the Hon9ble Supreme Court in the aforesaid decision, we consider the case on hand. - 14 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 (b) The lands in question were acquired by the State Government for the purpose of establishment of new Court Complex and residential quarters at Bangarpete. The details of the lands acquired are as under: Survey No. Extent of Land acquired LAC No. Date of Preliminary notification 33/1B 1 acre 4 guntas 02/2019 22.12.2011 33/1A 1 acre 4 guntas 04/2020 22.12.2011 32/2 37 guntas 01/2019 22.12.2011 (c) The claimants were examined as witnesses before the Reference Court and documentary evidence were marked to substantiate the claim for higher compensation. The Reference Court, after examining the oral and the documentary evidence mainly relying on the oral testimony of the claimants and Ex.P1-the certified copy of the sale deed dated 09.11.2015, determined the market value of the lands in question. The oral testimony of the claimants indicate that the acquired lands are very near to RMC Yard, Bangarpete, fire station, Government First Grade College, Petrol Bunk, Kalyan Mantap, Shyam Private Hospital, BESCOM quarters and Axis Bank. The - 15 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 oral testimony of the claimants further make it clear that the acquired lands are in the developed area and are very near to the State highway. The aforesaid oral testimony of all the claimants clearly indicate that though the lands in question are the agricultural lands, they are having all the potentiality of a non-agricultural land. It is noticed that the purpose of acquisition is for construction of Court Complex and the said proposal to put up construction is within the area which is already developed. In our considered view, the Reference Court was fully justified in considering the nature of lands as non-agricultural lands for determination of the market value. (d) The claimants have produced the revenue records, mutation entries, tax paid receipts, patta book, award notice and photographs. These documentary evidence would not help the claimants to prove the actual market value of the lands in question. They can be considered only for the purpose of ascertaining the nature of the lands and the place where they exist. To - 16 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 substantiate the claim for higher compensation, the claimants have produced Ex.P1-sale deed dated 09.11.2015, Ex.P2-memorandum of deposit of title deed dated 23.09.2014 and Ex.P3-sale deed dated 14.06.2006. The preliminary notification, in the instant case was issued on 22.12.2011 and the market value of the acquired lands is required to be determined based on the date of preliminary notification. Considering that the preliminary notification was issued in the year 2011, the documents at Exs.P2 and P3 may not have any much relevance. Ex.P2 is the memorandum of deposit of title deed dated 23.09.2014 relating to 4 acres 26 guntas of land. The said document indicates that the Canara Bank has lent Rs.468 lakhs as loan by obtaining the security. The sanction of loan cannot be the basis to determine the market value. The sanction of loan may vary from case to case on other factors. Hence, Ex.P2 would not help the claimants to prove the actual market value of the lands. Similarly, Ex.P3 in LAC No.4/2020 is the sale deed dated - 17 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 14.06.2006. The time gap between the sale deed and the preliminary notification in question is more than 5 years. In Ex.P3, the sale consideration is Rs.48,500/- for 1.4 guntas and the said land is situated in the same village. The sale deed is of the year 2006 and pertaining to a small extent of land which cannot be the basis to determine the market value of the lands in question. The Reference Court relied on Ex.P1-sale deed dated 09.11.2015 and determined the market value by applying 10% de- escalation from 2012 to 2015. Further, the Reference Court deducted 20% towards the development charges and determined the market value at Rs.76/- per sq. ft. We have perused the contents of Ex.P1. It pertains to the sale of the land of the same village and the sale consideration per gunta is Rs.1,42,000/-. It is noticed that the claimants have neither produced any sale deed of the year 2011 nor the guidance value notification issued by the State Government. The only piece of evidence available to determine the market value is Ex.P1. The - 18 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 Reference Court has rightly applied the principles of de- escalation at 10% p.a. from 2012 to 2015. Further, it has deducted 20% towards the development cost and has come to the conclusion. The sale consideration in Ex.P1 is Rs.1,42,000/- per gunta and out of the said amount, if 10% escalation for 4 years is deducted and further 20% is deducted towards the development cost, the market value would be Rs.76/- per sq. ft. (e) It is further noticed that the SLAO who examined himself as RW-1 has clearly admitted with regard to the nature of the lands and their potentiality but has failed to produce any documentary evidence to rebut the evidence adduced by the claimants. The contention of the learned Additional Government Advocate that the SLAO has awarded a just compensation by determining the market value taking into account the comparative sale statistics, is liable to be rejected. RW-1 has not even marked the award. Nothing had prevented the - 19 - HC-KAR NC: 2025:KHC:48879-DB M.F.A. No.8424/2022 C/W M.F.A. No.8416/2022 M.F.A. No.8422/2022 respondents to place on record the documentary evidence to disprove the evidence on record. (f) In our considered view, the Reference Court, on judicious application of mind and after analyzing the oral and documentary evidence has determined the market value. We do not find any error or perversity in the finding recorded by the Reference Court calling for interference in these appeals. 9. For the aforementioned reasons, the appeals are devoid of merit and the same are accordingly dismissed. Sd/- (ANU SIVARAMAN) JUDGE Sd/- (VIJAYKUMAR A. PATIL) JUDGE RV List No.: 1 Sl No.: 74