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Judgment
Ramaprasada Rao, J.—These two appeals are against the judgment of the learned Subordinate Judge, Cuddalore, in O. P. Nos. 42 of
1968 and 43 of 1968 on his file. A. S. 367 of 1973 is by the State Government against the decision of the Court below in O. P. 42 of 1968. A. S,
603 of 1973 is against such a decision in O. P. 43 of 1968. The lands in O. P. 42 of 1968 are owned by a temple called Patalleswarar
Devastanam, The lands which are the subject-matter of O. P. 43 of 1968, are owned by a private party, The Land Acquisition Officer, after the
promulgation of the notice u/s 4(i) of the Land Acquisition Act on 27-12-1961, issued notices to the claimants as above which are marked as Exs.
B-2 and B-5. Both the notices are dated 24-4-1965. There is some controversy on the question as to whether the date of the notice should be
taken as the date of service of such notice on the claimants. The case of the State is that the date of the notice should primarily be taken into
consideration, for all purpose, whilst the case of the claimants is that the date of service of such notice governs all relevant considerations, We shall
advert to it at the appropriate time. In O. P. 42 of 1968, lands belonging to the Devastanam and situate in T. S. 258, 267 and 268 were acquired.
The extent of the land acquired in T. S. 258 is 3-02 acres with a well thereon. In T. S. 267, an extent of 3-61 acres with a well and in T. S. 268 an
extent of 4-24 acres with a shed are acquired. In O. P. 43 of 1968, 51 cents in T. S. 264, 2.83 acres with an engine shed and a hut and a bore-
well therein in T. S. 265 and 21 cents in T. S. 266 were acquired for the public purpose of providing house sites for low income group
Government servants. The claimants were not satisfied with the award of Rs. 820 per acre, granted by the Land Acquisition Officer who classified
the lands as agricultural dry lands and they sought for a reference u/s 18 of the Land Acquisition Act to the Civil Court. The learned Subordinate
Judge of Cuddalore based his estimate of the market value of the lands on the situation of the lands and their potential value and after taking into
consideration such other relevant factors for assessment, valued the lands at Rs. 6,000/- per acre. The State is dissatified with such assessment
made by the Civil Court and hence the two appeals.
The first contention of the learned Government Advocate, appearing for the appellant, is that there has been a proper service of notice which is
required u/s 9 of the Land Acquisition Act and such a notice having been properly served on the claimants, the fact that they did not prefer
compensation in due form with the necessary particulars within the time prescribed, before the Land Acquisition Officer, is fatal to a grant of any
sum over and above that granted by the Land Acquisition Officer, Secondly, it is said that the classification made by the Land Acquisition Officer
that the lands acquired for the public purpose are agricultural lands, is correct and an interference by the Civil Court regarding the same is not
warranted in the facts and circumstances. Thirdly it is said that the value fixed by the Court below is rather on the high side. We shall take up the
first contention.
Exs. B-2 and B-5 are admittedly the notices issued by the Land Acquisition Officer u/s 9(2) of the Act. It is not in dispute that the public notice
contemplated u/s 9(1) has been published. What is, however, said is that the date as it appears in Ex. B-2 and B-5 as the date of issuance of the
notice u/s 9(2) of the Act shall be deemed to be the date on which the claimants should have been served or in any event be deemed to have been
put on specific notice of the fact that the Collector expects a reply in the shape of a statement to be made in writing and signed by the claimant or
his agent within 15 days after the date of such notice stating the interests of the claimant in the land and particulars of claim to compensation for
such interests and other objections. Probably the provocation to put an accent on the date of the notice as the relevant circumstance for
consideration u/s 9(2) of the Act is given by the different language used by the Legislature in Section 9(3) of the Act. In Section 9(3), it is said that
the Collector shall also serve the notice to the same effect on the occupier of such land. The word ''serve'' does not appear in Section 9(2) of the
Act. But it merely contemplates that such notice shall state the particulars of the land and should require persons interested to appear personally
before the Collector at a time and place mentioned therein, such time not being earlier than 15 days after the date of the notice and state their
objections.
Natural justice requires that any notice to be effective and to be positive, should have been served on the person against whom it is intended and
without proof of such actual service of such notice, a bare inference of constructive knowledge of the obligation to prefer the claim within 15 days
from the date of the notice, ought not to be pressed into service to the prejudice of the affected party. Reading Section 9(2) and 9(3) together, we
are of the view that the intendment of the prescription and mandate in Sub-section (2) of Section 9 of the Act is to see that the notice u/s 9(2) as in
Section 9(3) should also be served on the persons affected and that ought to be the date which has to be reckoned for purpose of calculating the
15 days time available to the claimant for preferring his objections under the above sub-section. There is ample authority for the proposition that
any deviation from the mandate as appearing in Section 9(2) of the Act in the matter of the grant of interval of 15 days to the affected party to
submit his objection, has been held to be a contravention of the mandate in the statute. In N.M. Venkatarama Iyer Vs. Collector of Tanjore, it was
held that the personal notice u/s 9(3) of the Act should afford the occupier of the land the same interval of 15 days for stating the particulars of his
claim for compensation as is provided for in the case of a public notice under Sub-section (2) of Section 9. In that case of course the Court was
concerned with the notice under Sub-section (3) of Section 9. The principle appears to us to be the same and this prescription in Section 9(2) of
the Act read in conjunction with the well-known principles of natural justice, requires that it is the date of service of a statutory notice in any
enactment which ought to be the relevant factor to consider whether the subsequent conduct of the addressee is in accordance with the statute or
not. In the instant case, R. W. 2, examined on behalf of the referring Officer, admits that Exs. B-2 and B-5, were served only a week prior to the
date of the hearing. Undoubtedly such service, contravenes the main intention of the salutary provision in Section 9(2) of the Act. There is also
evidence on the side of the claimants in A. S. 367 of 1973. The Executive Officer of the Devastanam maintains a diary. He produced Ex. A-17, a
certified copy of an extract from the diary kept by him during the relevant period. That shows that the temple was only served on 19-5-1965.
Hero again, it falls short of the 15 days time for appearance prescribed in Section 9(2) of the Act. Thus this is a case where the date of the notices
Exs. B-2 and B-5 alone cannot govern the situation. But it is the date of service of such notices which is the essential criteria to consider whether
the claimants have acted in accordance with the statute or not. Obviously, the learned Government Advocate would stress upon this as this factor
is linked with another provision in the Land Acquisition Act, namely, Section 25 of the Act. Sub-sections (2) and (3) of Section 25 of the Act
contemplate two different situations. Under Sub-section (2) of Section 25 of the Act, the applicant should have refused to make a claim or
omitted, without sufficient reason, to make such a claim. In both the above cases, the amount awarded by the Court shall in no case, exceed the
amount awarded by the Collector. What is contemplated in Sub-section (3) of Section 25 of the Act is that if the claimant has omitted for a
sufficient reason (to be allowed by the Judge) to make such a claim, then the amount awarded to him shall not be less, but may exceed the amount
awarded by the Collector. The objection therefore of the State is that as the claimants did not prefer their claims in time and as there was no
sufficient reason for their omission to do so, they ought not to be awarded any amount in excess of the amount awarded by the Land Acquisition
Officer. We are unable to agree. On merits, we have already come to the conclusion that the 15 days time provided for u/s 9(2) of the Act was not
given to the claimants in both the appeals and that by itself is a sufficient reason for the learned Subordinate Judge to act under Sub-section (3) of
Section 25 of the Act and award an amount in excess of that awarded by the Collector. This question also was considered by our Court in The
State of Madras Vs. T.K. Srinivasa Iyengar and Another, . The Court held that if there was a deliberate refusal on the part of the claimant to make
a claim and if the omission to make it was without sufficient reason, then the Court would be justified in not awarding a compensation in excess of
that awarded by the Land Acquisition Officer. But if there are circumstances to show that the omission was for a sufficient reason, then Sub-
section (3) of Section 25 of the Act would come into play,
The merits of this case disclosed that the claimant in O. P. 43 of 1968 who was only served with a notice a week before the hearing, filed a
partition deed Ex. B-3 (petition to R.D.O. Chidambaram) as also a medical certificate Ex. B-4 to show that he could not file his statement of
objections in time. The Land Acquisition Officer ignored such objections, but passed the award on the date of hearing fixed by him. The
explanation given by the Executive Officer that he took some time to get instructions from the higher hierarchy cannot be lightly brushed aside as
one without substance or without reason. Therefore the Court below was right when it upheld the claimant''s contention that the omission to file
their claims and their objections on or before the date fixed for hearing by the Land Acquisition Officer u/s 9 of the Act, was with sufficient cause
and that the omission was neither deliberate nor wanton. We therefore agree with the claimants-respondents that this is not a case in which Section
25(2) of the Land Acquisition can be invoked and the claimants be refused a compensation higher than that awarded by the Land Acquisition
Officer.
The third argument of the appellant is that the market value fixed by the Civil Court is rather on the high side. We have already made it clear that
the classification of the lands as agricultural lands, by the Land Acquisition Officer is not at all justified. No doubt the mere fact that the lands are
situate in a Municipality or in a town cannot by itself be urged as one and sole factor to decide that though in public records the lands are described
as agricultural lands, they ought to be treated as house sites or lands fit for house sites. The decision relied upon by the learned Vakratunda
Chintaman Deo Vs. Special Land Acquisition Officer, is not apposite as would be seen hereafter. There the Division Bench of the Bombay High
Court said that every piece of land within the Municipal area acquired by the Government may not be assumed to have an immediate building
potentiality. The circumstance that some temporary hutments had, during the period of requisition of the agricultural land by the Government,
included in the Municipal area had been constructed on the land would not attribute to the land a building potentiality at the date of the acquisition.
What is the reasonable classification to which the acquired lands can be pigeon-holed in this case? The lands are surrounded on the west, south
and east by public streets and on the north by a railway station. Very near to these lands are colonies which had already developed and the
proximity of such a residential locality to the acquired lands, gives a different status and classification altogether and a mere reliance on the public
records for purposes of appreciating the use to which the lands can be put to, ought not to be always, encouraged. The evidence in this case also is
a pointer to the potential use to which these acquired lands can be put to. P. Ws. 1 and 2 speak of such an inhered potential in the lands. They
were not cross-examined and nothing against such a reasonable assumption was brought out. That such potential inhered in the land should also
provide a guide for evaluation is more or less accepted by this Court. Vide Egappa Gounder v. Special Tahsildar, Madras, (1970) 83 Mad LW
561 and State of Madras v. Ramaswami, (1970) 83 Mad LW 621. In one of the cases to which one of us was a party, we made it clear that the
condition of the land together with its existing advantages immediate possibilities and prospective capabilities go into the mechanics of computation.
The impact of a developed neighbourhood or the prospect of it in and around the sector of acquisition turns such potential of the land to account as
well. But certain limitations to the adoption of the above principle were also pointed out. The court said that such future utility which an owner of
the land can take advantage of, ought not to be conjectural, but should reasonably be based on normal business principles. In the Bombay case
cited, there was only a chance of the properties developing. But in contradistinction to the observation of the learned Judges of the Bombay High
Court, in the case under review, there is certain potential in the land and such potential being referable to its certain future improvements as a
building site, it cannot be treated as agricultural lands. We are therefore unable to agree with the third contention of the learned counsel for the
appellant that the lands have to be still valued only as agricultural lands. The court below has rightly treated the lands as potential house sites and
valued the same.
As regards the price reliance was placed upon Exs. A-2 to A-4 by the civil court. The important date is provided under Ex. A-2 which is dated
5-9-1962. This of course is a post notification sale. But in the absence of any other sale in the vicinity of a building site, the court had to refer to
Exs. A-2, A-3 and A-4 which sales took place in the years 1962 and 1964 for purposes of a fair evaluation of the just compensation payable to
the land. The witness examined for the Referring Officer, R. W. 2, in his evidence stated that the lands sold in S. No. 365 are in no way different
from the lands acquired. The lands sold in S. No. 365 are lands which were the subject-matter of the sale in Ex. A-2. It cannot be said that Exs.
A-3 and A-4 relate to sales which are dissimilar to the lands comprised in the sale deed Ex. A-2. Having regard to the fact that PWs. 1 and 2
were not even cross-examined on their testimony as to the fitness of the acquired lands as building sites and the adaptability of the value in Ex. A-
2, we are unable to say that the value fixed by the court below at Rs. 6000 per acre on the date of the notification u/s 4(i) of the Act is in any way
unreasonable.
The last point urged before us is that the cross objections in A. S. 603 of 1973 are without merits. Learned counsel for the cross-objector in AS
603 of 1973, would say that he is entitled to severance compensation. According to him, the well in the land acquired, having been compulsorily
taken away and severed from the neighbouring lands which the well was watering and irrigating, he has suffered thereby and therefore, he would
be entitled to severance compensation. We are unable to agree that this head of compensation provided for in Section 23 of the Act, would ever
take in any such claim at all. ""Severance compensation"" as the term itself indicates, is compensation awardable to the affected person because of
the severance of the land into different parcels by reason of the compulsory acquisition. What is said is that because of the well in the land has also
been acquired and for which compensation has also been paid, the surrounding lands of his have suffered damage. Learned counsel for the cross
objector did not point out to us any specific provision under which such a grant can be made and we are unable to find one ourselves under which
this claim can be sustained. There is fallacy equally in this argument because the compensation has been granted to the claimants not as an
agricultural land, but as a house site. When we querried Mr. N.S. Varadachari, whether he could still insist on his case for severance
compensation, and whether the cross objector would be willing to take compensation for the land on the basis that it is agricultural lands, he
expressed his difficulty. On that ground also, this claim for severance is not sustainable. The appeals fail and even so the memorandum of cross
objections. They are dismissed. There will be no order as to costs.