State of Jammu & Kashmir vs Masooda Maryam Fazili

Janak Raj Kotwal, J.—This is a Civil 1st appeal. Land measuring 226 kanals 6 marlas situate at Nunwanen Pahalgam, Distt. Anantnag has

been acquired by the Government for a public purpose, namely, development of Phalgam out of which land measuring 15 kanals 2 marlas

comprised in Khasra No. 188/38 280/36, 185/36 belonged to the respondent herein.

Notification u/s 4 of the State Land Acquisition Act, 1990 (for short the Act) was issued vide No. 245-50/LA dated 13.08.1979 and & 230-

44/LA dated 11.09.1980. Declaration u/s 6 of the Act was made vide Revenue Department s. No. RV-LA/195-97 dated 26.11.1980 and

Rev/LAK/154/79 dated 17.04.1980. Notification u/s 9 and 9A of the Act was issued vide No. 424-44/LA dated 26.04.1980. Award was made

by the Collector Land Acquisition, Assistant Commissioner (Revenue), Anantnag on 15.05.1982. Compensation was awarded at the rate of Rs.

5,000/ per kanal besides 15% solatium (Jabrana). Respondent received the compensation under protest. On respondents application alleging that

the compensation awarded was nominal, the Collector made reference u/s 18 of the Act to the court of learned District Judge, Anantnag.

Appellant-State of Jammu and Kashmir resisted the reference. Learned District Judge after recording evidence and hearing both sides, disposed

of the reference vide Judgment dated 30.08.2003 holding that the prevalent market rate in the area at the time of the acquisition of the respondents

land was 2.40 lac to 2.98 lac rupees per kanal and compensation at the rate of Rs. 2,40,000/ per kanal amounting to Rs. 36,24,000/ besides 15%

solatium was payable to the respondent. Learned District Judge, therefore, passed decree for payment of Rs. 41,67,600/ as compensation with

6% interest per annum in favour of the respondent.

Appellant-State through the Collector has assailed the judgment and decree passed by the court of learned District Judge, Anantnag in this

appeal. Intending department, the Pahalgam Development Authority, on its application has been impleaded as appellant at a later stage.

The judgment and decree have been assailed on the grounds that the determination of market value of the land by the learned District Judge is

based upon no evidence. The learned Judge has passed the Award on the material, which is wholly and totally extraneous and foreign to the

proceedings and merit of the reference. It is contended that the learned District Judge has allowed herself to fall into grave error by placing reliance

on Government Order for compensation issued by the appellant. It is contended that the learned District Judge did not take into consideration the

evidence produced by the appellant/Collector, which clearly indicated that the compensation had been awarded by the Collector after taking into

consideration all the relevant factors including the site, value and potential of the land and some transactions effected by various persons in the

vicinity. It is contended that learned District Judge ignored the contention of the appellant that area in which the respondents land was situate was

falling within the zone where no construction was permissible because of blanket ban imposed by the Government so price of the petitioners land

falling in that area was not comparable to the instances on which reliance was placed by the respondent. It is pointed out that relevant date for

determination of the compensation was November, 1980 when Notification u/s 6 of the Act was issued but learned District Judge fell into error by

taking into consideration a Government Order No. 482 of 1981 dated 31.07.1981. It is also contended that the learned District Judge has erred in

determining the market value as required u/s 23 of the Act. One of the grounds of challenge is that the application for reverence u/s 18 of the Act

was time barred so reverence was not maintainable.

The final award as regards the entire land including the land owned by the respondent was signed and made by the Collector on 15.05.1982.

The application for making reference to the District Court was moved by the respondent before the Collector on 25.06.1986. Letter of reference

is dated 01.05.1986 and reference was received in the Court of District Judge, Anantnag on 13.09.1986. This is the common ground of both the

parties

Appellant-State raised objection before the learned District Judge to the maintainability of the reference contending that the application for

reference having not been made within six months from the date of award, the reference was time barred. Impugned judgment of the learned

District Judge has been challenged before this court on this ground too.

Mr. M.A. Chashoo, learned AAG appearing on behalf of appellant-State and Mr. N.H. Shah, learned Dy. AG appearing on behalf appellant-

intending department argued insistently that u/s 18(b) of the Act maximum time limit for making application for reference to the court is six months,

which is mandatory in nature and the learned District Judge has fallen into error by entertaining the time barred reference and proceeding on the

same.

Per contra, Mr. J.H. Reshi, learned counsel for the respondent would say that it is well settled that the date of award as contemplated u/s 18(b)

of the Act means the date on which owner/interested person, to whom notice of acquisition or copy of award has not been sent, gets knowledge of

the award. He submitted further that application was moved by the respondent immediately after she got knowledge of the award, which fact was

sufficiently proved before the District Judge so appellants' contention that application for reference was time barred is devoid of any merit.

Section 18(1) of the Act provides for making of reference by the Collector to the court inter alia for determination of compensation on

application of any interested person, who is not satisfied with compensation awarded by the Collector. Section 18(2) provides that application

shall state the grounds on which objection to the award is taken. Proviso (a) & (b) to sec. 18 provide for the time period within which application

for reference shall be made by interested person(s), which reads:

(a) if the person making it was present or represented before the Collector at the time when he made his award within six weeks from the date of

the Collectors award;

(b) in other cases, within six weeks of the receipt of the notice from the Collector u/s 12, sub-section

(2), or within six months from the date of the Collectors award, whichever period shall first expire.

(Emphasis supplied)

The expression 'the date of the collector's award appearing in proviso (b) came up for interpretation before the Supreme Court far back in

Raja Harish Chandra Raj Singh Vs. The Deputy Land Acquisition Officer and Another, Their Lordships have observed in pare 5 of the judgment:

In dealing with this question it is relevant to bear in mind the legal character of the award made by the Collector under S. 12. In a sense it is

decision of the Collector reached by him after holding and enquiry as prescribed by the Act. It I a decision, inter alia, in respect of the amount of

compensation which should be paid to the person interested in the property acquired; but legally the award cannot be treated as a decision; it is in

law an offer or tender of the compensation determined by the Collector to the owner of the property under acquisition. If the owner accepts the

offer no further proceedings is required to be taken; the amount is paid and compensation proceedings are concluded. If, however, the owner does

not accept the offer S. 18 gives the statutory right of having the question determined by Court and it is the amount of compensation which the

Court may determine that would bind both the owner and the Collector. In that case it is on the amount thus determined judicially that the

acquisition proceedings would be concluded. It is because of this nature of the award that the award can be appropriately described as a tender or

offer made by the Collector on behalf of the Government to the owner of the property for his acceptance.

While taking this view about the award of the Collector, Their Lordships held:

Therefore, if the award made by the Collector is in law no more than an offer or made on behalf of the Government to the owner of the property

then the marking of the award as properly understood must involve the communication of the offer to the party concerned. That is the normal

requirement under the contract law and its applicability to cases of award made under the Act cannot be reasonably excluded. Thus considered the

date of the award cannot be determined solely by reference to the time when the award is signed by the Collector or delivered by him in his office,

it must involve the consideration of the question as to when it was known to the party concerned either actually or constructively. If that be the true

position then the literal and mechanical construction of the words the date of award occurring in the relevant section would not be appropriate.

Their Lordships in the same judgment have considered the point from another angle too and have observed in para 6 of the judgment:

if the award is treated as an administrative decision taken by the Collector in the matter of the valuation of the property sought to be acquired it

is clear that the said decision ultimately affects the' rights of the owner of the property and in that sense, like all decisions which affect persons, it is

essentially fair and just that the said decision should be communicated to the said party. The knowledge of the party affected by such a decision,

either actual or constructive, 'is an essential element which must be satisfied before the decision can be brought into force. Thus considered the

making of the award cannot consist merely in the physical act of writing the award or signing it or even filing it in the office of the Collector; it must

involve the communication of the said award to the party concerned either actually or constructively. If the award is pronounced in the presence of

the party whose rights are affected by it can be said to be made when pronounced. If the date for the pronouncement of the award is

communicated to the party and it is accordingly pronounced on the date previously announced the award is said to be communicated to the said

party even if the said party is not actually present on the date of its pronouncement. Similarly if without notice of the date of its pronouncement an

award is pronounced and a party is not present the award can be said to be made when it is communicated to the party later. The knowledge of

the party affected by the award, either actual or constructive, being an essential requirement of fair-play and natural justice the expression ""the date

of the award"" used in the proviso must mean the date when the award is either communicated to the party or is known by him either actually or

constructively. In our opinion, therefore, it would be unreasonable to construe the words ""from the date of the Collector's award"" used in the

proviso to s. 18 in a literal or mechanical way.

Recently section 18 of the Act came up for interpretation before the Supreme Court in Bhagwan Das and Others Vs. State of UP and Others,

In this case Their Lordships have held:

(i) If the award is made in the presence of the person interested (or his authorized representative), he has to make the application within six weeks

from the date of the Collector's award itself.

(ii) If the award is not made in the presence of the person interested (or his authorized representative), he has to make the application seeking

reference within six weeks of the receipt of the notice from the Collector u/s 12(2).

(iii) If the person interested (or his representative) was not present when the award is made, and if he does not receive the notice u/s 12(2) from

the Collector, he has to make the application within six months of the date on which he actually or constructively came to know about the contents

of the award.

(iv) If a person interested receives a notice u/s 12(2) of the Act, after the expiry of six weeks from the date of receipt of such notice, he cannot

claim the benefit of the provision for six months for making the application on the ground that the date of receipt of notice u/s 12(2) of the Act was

the date of knowledge of the contents of the award.

(Emphasis supplied)

Legal position in context of Proviso (b) of section 18 of the Act, therefore, is clear too and should no more be taken as re integra. In a case

where an interested person (or his authorized representative) was not present at the time of making/announcement of the award by the Collector

and notice of the award was not issued to him, the date of award shall be taken as the date on which he/she gets knowledge of award and six

months duration for making application for reference to the court u/s 18 of the Act shall commence from the date of his/her knowledge.

u/s 12(2) of the Act duty is cast upon the Collector to give immediate notice of the award to such of the persons interested who were not

present personally or through their representatives when the award was made. Therefore, while raising the plea of limitation, the party raising the

plea has not only to refer to the date of Collectors award but must show that the notice as contemplated u/s 12(2) was issued by the Collector and

served upon the concerned interested person(s).

Neither before the learned District Judge nor in this appeal, had the stand of the State been that respondent (or his authorized representative)

was present before the Collector at the time when he made/announced the award on 15.5.1982. Likewise, neither it had been nor it is the stand of

the State that notice of award as required u/s 12(2) of the Act was issued to and served upon the respondent. Only question, thus, arising before

the learned District Judge was and raised before this Court is what should have been taken as the date of the Collector's award' for the purpose of

the reference in question.

The question involving the date of knowledge of award to the respondent was formulated by the learned District Judge in issue no. 1, which

reads:

Whether the petitioner has got the knowledge about the award on 24.6.1986, if so, what is its effect? OPP

Learned District Judge after discussing the evidence and other material on record came to the conclusion that the petitioner (herein respondent)

has succeeded to prove that she got knowledge about the award on 24.6.1986 and accordingly, decided issue No. 1 in her favour.

I have perused the evidence in this regard and having done so, find no reason for disagreeing with the finding recorded by the learned District

Judge. Learned counsels for the appellants were not in a position to make out a case for disturbing the finding recorded by learned District Judge.

Respondent having discharged her onus by leading sufficient evidence to show that neither she was present at the time of making the award nor

notice of award was served upon her and that she got knowledge of the award on 24.6.1986, appellants have failed to show, much less prove,

that date of knowledge of award to the respondent was other than the one claimed by her. Objection to the award on this score, therefore, fails

and is rejected.

The other ground of challenge to the impugned judgment is that learned District Judge has fallen into error in determining the compensation at

the rate of Rs. 2,40,000/ per kanal.

Mr. Chasoo and Mr. Shah, while reiterating the contentions stated in the memo of appeal, sought to demonstrate painstakingly that learned

District Judge has not followed the guidelines as provided u/s 23 of the Act for determining the market value of acquired land. They argued that

respondent has failed to produce any material to show that the acquired land of the respondent would have fetched her Rs. 2,40,000/ per kanal,

had it been sold by her at the relevant time. They argued further that the learned District Judge has fallen into error by relying on the awards passed

in other cases without there being any connecting evidence.

Mr. Reshi, however, supported the judgment of the District Judge by referring to a number of case law in the matter.

Before taking up the rival contentions, it is apt to state that determination of compensation to be awarded to interested person(s) is governed

by sections 23 and 24 of the Act. The court primarily has to determine the market value of the acquired land on the date of publication of the

declaration u/s 6 of the Act. After determining the market value, court must have regard to the other factors enumerate in section 23, which will

have positive effect on the amount of compensation to be awarded. Section 24 enumerates the factors, which, however, are to be ignored and will

not weigh in favour of the interested persons.

Judicially evolved meaning of the term market value as contemplated u/s 23 (first) is the price that a willing purchaser would be willing to pay to

the willing seller. This means that the price offered/paid in a desperate sale or a sale made in some peculiar circumstances and in other cases of the

like nature cannot be taken into consideration for determination of market value of the acquired land.

Interested person(s) on whose application reference is made can prove the market value of the acquired land by leading direct evidence to the

effect that he had been offered a particular price at or around the relevant time. Such an attempt has been made by respondent in this case, which

aspect shall be taken up later hereafter. However, normally such evidence is not available because it would be difficult to lead convincing evidence

to prove that some negotiation of the sale of acquired property had taken place at or around the relevant time.

Judicially recognized and preferred method for determination of the market value, however, is comparable sales method of valuation. This

method involves taking into consideration the sale transactions having taken place in the close vicinity or the adjoining areas of the acquired land at

the relevant time. Such transactions can be proved by producing the sale deeds of comparable sales of land in the close vicinity or the adjoining

areas and leading evidence about similarity between the acquired land and land covered by those comparable sale deeds. Another method

recognized by the Courts, which can be resorted to, if evidence of comparable sale is not available, is the judgments and awards in respect of

acquisition of land made in close vicinity of acquired land in the same village or in neighbouring villages.

Supreme Court in Shaji Kuriakose and Another Vs. Indian Oil Corpn. Ltd. and Others, has observed as under:

It is no doubt true that courts adopt comparable sales method of valuation of land while fixing the market value of the acquired land. While fixing

the market value of the acquired land, comparable sales method of valuation is preferred than other methods of valuation of land such as

capitalization of net income method or expert opinion method. Comparable sales method of valuation is preferred because it furnishes the evidence

for determination of the market value of the acquired land at which a willing purchaser would pay for the acquired land if it had been sold in the

open market at the time of issue of notification u/s 4 of the Act. However, comparable sales method of valuation of land for fixing the market value

of the acquired land is not always conclusive. There are certain factors which are required to be fulfilled and on fulfillment of those factors the

compensation can be awarded, according to the value of the land reflected in the sales. The factors laid down inter alia are: (1) the sale must be a

genuine transaction, (2) that the sale deed must have been executed at the time proximate to the date of issue of notification u/s 4 of the Act, (3)

that the land covered by the sale must be in the vicinity of the acquired land, (4) that the land covered by the sales must be similar to the acquired

land and (5) that the size of plot of the land covered by the sales be comparable to the land acquired. If all these factors are satisfied, then there is

no reason why the sale value of the land covered by the sales be not given for the acquired land. However, if there is dissimilarity in regard to

locality, shape, site or nature of land between land covered by sales and land acquired, it is open to the court to proportionately reduce the

compensation for acquired land than what is reflected in the sales depending upon the disadvantages attached with the acquired land.

In this case respondent's effort to prove the market value of the acquired land at the relevant time by leading direct evidence to the effect that

hotel owners were ready to pay her Rs. 5,00,000/ per kanal as cost of the acquired land, however, did not find favour of the learned District

Judge. In this regard the respondent, besides her statement, has produced before the learned District Judge one Mohammad Saleem Rather as her

witness, who stated that owners of Hotel, Pahalgam and Hotel, Wood Stock intended to purchase land of the petitioner through him. They were

ready to pay Rs. 5,00,000/ per kanal to the respondent but she did not accept this price as she had been demanding 6 to 6.50 lacs per kanal.

Learned District Judge has rejected this evidence stating well founded reason and this aspect of the matter, having not been assailed, calls for no

reconsideration.

Respondent did not produce any evidence about comparable sale transactions in the area. This finds mention in the impugned judgment in the

words that ""petitioner has not produced any document, sale deed which would suggest valuation of land acquired or adjacent to the acquired land

at the time of issuance of notification for acquisition of land.

Respondent had also relied upon the sale by auction of 15 kanals of land at Pahalgam comprising of two hotel sites at the rate of 3.50 lac

rupees per kanal by the Government to the M/s. A.K. Enterprises, Rajbagh. This however, has been rejected by the learned District Judge holding

that evidence in this regard was not sufficient and further that 'the acquisition of land of the petitioner by the Government and auction of the land by

the Government have taken place at different times and that the two properties were not situated adjacent to each other but situated at two

different places. Finding on this score is not under challenge.

Learned District Judge, nevertheless, has enhanced the compensation by relying upon the judgment passed by the learned Additional District

Judge, Srinagar in case, titled, Mohd. Yaqoob Khan and ors. v. Collector and ors. In this regard, learned District Judge noticed that the land of the

petitioner Mst. Masooda Maryam (herein respondent) has also been acquired by the same notification and took the view that market value

determined by the competent court with respect to the acquired land which has become final, can be taken into consideration for determining just

compensation. A copy of the judgment in Mohd. Yaqoob Khan and ors. v. Collector and ors. dated 27.11.1987 rendered by learned Additional

District Judge, Srinagar is available on file of learned District Judge. This judgment on perusal reveals that reference in that case was transferred

from the court of District Judge, Anantnag to the Court of learned Additional District judge, Srinagar by the order of this Court passed in a transfer

application. Learned Additional District Judge, Srinagar after consideration of the evidence has held that interested persons were entitled to

compensation at the rate of Rs. 2,65,000/ per kanal.

It was not disputed before learned District Judge nor it has been disputed in this appeal that the subject land in Mohd. Yaqoob Khan's case

and that involved in this case are located at the same place and had been acquired pursuant to the same notification for the same public purpose by

the same award. It is also not disputed that for the entire land acquired by the said award, compensation at uniform rate of Rs. 5,000/ per kanal

was assessed by the collector. This, in turn renders it indisputable that both the lands were of similar nature and same compensation for both

should be paid. Besides Mohd. Yaqoob's case, Ld. District Judge has also referred to the case of one Mohammad Ishaq Kotwal taking notice

that compensation of the land of one Mohammad Ishaq Kotwal, which was acquired from the same Pahalgam project was assessed as Rs. 2.40

lacs per kanal.

It is well settled that a judgment of a competent court in a land acquisition case determining the market value of a land in the vicinity of acquired

land, even though not inter parties, is admissible in evidence either as an instance or one from which the market value of the acquired land could be

deduced or inferred. Pal Singh and others Vs. Union Territory of Chandigarh,

View taken by the Supreme Court in Pal Singh's case has been referred to with approval by Their Lordship in Karan Singh and others etc. Vs.

Union of India, wherein it is held:

There is no quarrel with the proposition that judgments of Courts in land acquisition cases or awards given by the Land Acquisition Officers can be

relied upon as a good piece of evidence for determining the market value of the land acquired under certain circumstances. One of the

circumstances being that such an award or judgment of the Court of law must be a previous judgment.

Recently Supreme Court has referred to with approval the Pal Singh's case in Chandrashekhar and Others Vs. Additional Special Land

Acquisition Officer,

As stated above, the subject lands in Mohd. Yaqboob Khan's case and in this case have been acquired in the same acquisition process for the

same purpose by the same award. It emerged as an admitted position during hearing of the case that in Mohd. Yaqoob's case compensation at the

enhanced rate has been paid by the Government. Enhanced compensation paid to one aggrieved person can well be made the basis for granting

similar compensation to another similarly situated aggrieved person. Learned District Judge, therefore, cannot be said to have committed any error

by relying upon the assessment of market value made by Additional District Judge, Srinagar in Mohd. Yaqoob's case and fixing the market value

of respondents acquired land as 2.40 lac rupees per kanal. For the aforementioned, this appeal has no merit and the same is dismissed.