V. Kannia Lal and Others vs Collector of Madras

Veeraswami, J.—Claimants 1 to 11 in the land acquisition proceedings are the appellants. A total extent of 3 cawnies, 7 grounds and 661

sq. ft. comprised in R. S. 2381/88 in Mylapore was acquired compulsorily under the provisions of the Land Acquisition Act for construction of

quarters for the staff of the police department. The notification under S. 4(1) of the Act was made on 29-1-1958. On the basis of a sale dated 11-

5-1957, of an extent of 2046 sq. ft. for Rs. 2500 in R. S. 2195/1, 4 and 5 in Mylapore, which works out at the rate of Rs. 2932 per ground, the

Land Acquisition Officer allowed compensation at the rate of Rs. 2130 per ground, after deducting 25 per cent of the area for providing roads and

Rs. 800 per ground for meeting the cost of laying roads. He awarded Rs. 1,26,642-70 nP. at that rate for the extent of two cawnies, 11 grounds

and 1096 sq. ft. On a reference to the City Civil Court, under S. 17 of the Land Acquisition Act, the learned Assistant Judge of that court raised

the compensation payable for the land abutting the bazar road to Rs. 3000 per ground and for the rest at the rear of it to Rs. 2200 per ground. He

also reduced the extent to be allowed for roads to 20 per cent. But he agreed with the Land Acquisition officer as to the cost per ground of laying

roads. Claimants 1 to 11 alone aggrieved by this decree have come up to this court.

(2) It is contended that on the basis of the sale deed, Ex. C-1, dated 19-11-1953, they should have been granted Rs. 5000 per ground for the

area abutting the main road, which is of an extent of 4 grounds and 1900 sq. ft. We accept the contention. The plot sold under Ex. C-1 is also

abutting the main road and is of an extent of about 3 grounds. We see no reason why this should not be taken as the basis. Clearly the rate fixed

by the court below is too low. Though Ex. C-1 related to 1953 and the value in the following year should have appreciated, on a consideration of

all the circumstances, Rs. 5000 per ground for the said area abutting the main road will in our opinion be reasonable.

(3) The next question is whether, as contended for the appellants, the court below was right in deducting 20 per cent of the total area for laying

roads and Rs. 800 per ground towards the cost of laying roads in fixing the market value for the remaining land. The land is situate undoubtedly in

a developed and a busy locality, but is by itself undeveloped as it is away from the main road. Extensive as it is, it has to be plotted out into smaller

house sites with amenities. These amenities will consist of roads, drainage, lighting and so on, and roads will require space and laying of roads will

mean expenditure. In such a case, therefore, before valuing the land as house site, allowance will have to be made for the space which will be

taken up for roads and the cost of the rest of the amenities, including the cost of laying roads. This principle has been recognised in State of

Madras Vs. Balaji Chettiar and Others, , in which this court observed--

Roads cannot be laid without space and huge blocks of lands cannot be split into building plots and valued per ground without roads. Nor can

they be treated as developed lands without deducting such space. So, the space required for roads is something different and additional to the cost

of laying roads themselves and providing other amenities like electricity, water, underground drainage etc. So, the deduction of 25 per cent in this

appeal and of ten per cent in A. S. 614 of 1963 was correct.

The same method of valuing lands at the rear which are undeveloped when compared with lands abutting a main road was adopted in State of

Madras v. Sri Raja Rao Venkata Kumara Mahipathi Surya Rao Bahadur, A. S. No. 96 of 1961 (Mad). In Additional Special Land Acquisition

Officer, Poona Vs. Shantaram Shamrao Ghole, it was pointed out :

In assessing the market value on the basis of a hypothetical scheme for residential buildings by laying out the land into plots, it is not what the

claimant may have expected to receive by sale of one or two plots out of the land which is to be decisive of the value of the land, but what the

valuer may regard as the value of the plots aggregated after taking into consideration the expenses of providing the amenities which the purchasers

may normally expect to obtain in the sector in which the land is situate.

With respect, we agree with these observations. Where the value of an undeveloped land in a developed area is to be assessed on a comparison

with the value of the latter, the process of estimating should necessarily involve deduction of the cost of factors required to bring the undeveloped

lands on a par with the developed lands. We consider, therefore, that the court below was right in making allowance for the space for roads and

also for the cost of laying roads and of other amenities. Counsel for the appellants, however, invited our attention to Mohamed Karimuddin v.

Collector of Madras, ILR (1964) Mad 337 to which one of us was a party. But it may be seen that compensation in that case too was given at a

higher rate per ground for lands abutting the road and at a lower rate for lands lying to the rear. Further, this court in that case was valuing a

bungalow with a large extent of land around it forming one unit, the whole of which was compulsorily acquired. In this case, the land acquired is a

vacant site without any building, part of the land abutting a main road.

(4) The next question is whether the court below is right in deducting 20 per cent of the total area as for space required for roads. Counsel for the

appellants has not shown any basis on which we can differ from the court below on this aspect. Having regard to the total extent of 79 grounds,

under acquisition, it seems to us that the extent of space which is one-fifth of the total area may reasonably be required for roads. As to the cost of

laying them, it is contended that Rs. 800 per ground is excessive. There is perhaps some force in this contention, though there are no clear data

before us. In State of Madras Vs. Balaji Chettiar and Others, , a case of acquisition in 1948, the cost of making roads was fixed at Rs. 450 per

ground, and in A. S. No. 96 of 1961 (Mad) where the acquisition was in 1957, at Rs. 600 per ground. In this case, the acquisition was in 1958,

and we are of the view that Rs. 600 may be a fair rate.

(5) Counsel for the appellants relied on Ex. C-2, dated 2-11-1955, which conveyed for Rs. 1225 at the rate of Rs. 3500 per ground an extent of

840 sq. ft. forming part of the land now under acquisition, and pressed that we should adopt this rate for the rear lands. We think that this is a just

claim. We are aware that the price paid for a small plot of land cannot normally be the sole basis for determining the market value of a larger

extent. Even so, as the land covered by Ex. C-2 abuts a lane and since 1955, prices must have gone up in the locality by 1958, we think Rs. 3500

per ground is reasonable.

(6) In modification of the decree of the court below, the appellants will be paid compensation only so far as they are concerned at the rate of Rs.

5000 per ground for their half share in an extent of 4 grounds and 1900 sq. ft., which abuts the main road, and at the rate of Rs. 3500 per ground

for their share in the remaining extent of land, after deducting 20 per cent of the total area as for making roads and Rs. 600 per ground with

reference to their half share in the 80 per cent of the land towards the cost of laying roads and other amenities. The solatium granted to them by the

court below will stand but will be worked out on the basis of our decree. The appellants will be entitled to interest from the date allowed by the

court below.

(7) The appeal is allowed in part but with no costs. As regards the non-appealing claimant or claimants, the decree of the court below will stand.

KI/RSK/R.G.D.

(8) Appeal partly allowed.