WAZIR & ANR. versus STATE OF HARYANA on 11 January 2019

[2019] 2 S.C.R. 571

WAZIR & ANR.

v.

STATE OF HARYANA(Civil Appeal Nos. 264-270 of 2019)JANUARY 11, 2019*[UDAY UMESH LALIT ANDDR. DHANANJAYA Y CHANDRACHUD, JJ.]

Land Acquisition Act, 1894:

s. 23 – Compensation – Claim of – Fixation of market valueof the acquired land – On facts, in the year 2002, around 1500acres of land acquired from different villages for public purpose ofdevelopment of Industrial Township, Manesar, Gurgaon by threenotifications – Award of compensation to land owners for differenttypes of lands – Two sets of villages given differential treatment –Challenge to, by land owners – Reference Court relying on thedecision in Pran Sukh case enhanced the compensation – Thereafter,in the pending applications, Reference Court enhanced thecompensation at the rate of 12% p.a. taking the base rate to be Rs.20 lakhs per acre as on 1994, in terms with the Pran Sukh case –Compensation awarded at the same rate for all kinds of land – Inappeal, the High Court relying on the exemplar, computed the figuresby giving cumulative enhancement at the rates of 12% and 15%over the base rate of Rs.20 lakhs per acre and applying cut of 10%and 20% – Compensation assessed at Rs.41.40 lakhs per acre inrespect of lands acquired in villages – Compensation in villageManesar assessed after giving 50% enhancement at Rs.62.10 lakhsper acre – As regards land held by K additional component of 30%also awarded on account of severance charges, over and abovethe rate of Rs.62.10 lakhs per acre – On appeal, held: On basis ofdocuments on record, sale deeds, three methods-Method no.1,Method no.2 and Method no.3, the market value for the lands inNaharpur Kasan and Kasan would be Rs. 39,54,666/- per acre,the market value of lands from villages Bas Kusla, Bas Haria andDhana would be Rs. 29,77,333/- per acreand in respect of villageManesar, the market value would be Rs. 59,31,999/- per acre– Inaddition all statutory benefits would be payable – However, K wouldnot be entitled to any severance charges.

*With modifications as set out in Para 9 of Order dated 08.02.2019 passed in M.A. No.299 of 2019 in CA Nos. 264-270 of 2019.

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ADisposing of the appeals, the CourtHELD: 1.1 In the instant case, the sale deeds Exts.P1, P2and P3 relied upon by the landholders pertained to lands fromvillages Bas Kusla and Dhana and were of the year 1997 that isafter the acquisition was initiated in Pran Sukh’s case. TheBmaximum value per acre in these villages was Rs.8 lakhs peracre and that too with respect to smaller plots. The sale deedsExts.P4, P6, P8 and PY however pertained to lands coming fromvillages Naharpur Kasan and Kasan. Ext.PY dated 28.04.2004was much after the acquisition was initiated in the instant case.Secondly, as found by the High Court, there was constructionCand CLU was also obtained in relation to land in Ext. PY. Forthese reasons the High Court had rightly ruled out saidtransaction. At the same time Ext.P4 was also after the acquisitionin the instant case was initiated and pertained to a small plot ofland. Out of these four sale deeds, Ext.P8 is prior in point of Dtime so far as the instant acquisition is considered and wastherefore rightly relied upon as the most appropriate exemplarby the High Court. If the value in Ext.P8 is compared with themaximum value under Exts.P1, P2 and P3 there is a markeddifference. This difference is again consistent with the valuation

that was accepted by the Sub-Divisional Officer cum LandEAcquisition Collector. Since major part of the land underacquisition that is more than 2/3[rds] is from villages Bas Kusla,Bas Haria and Dhana, one way of assessing the correct value ofcompensation is to treat these three villages on one side whileother three villages on the other side. However, not only theFReference Court but the High Court on three different occasionshad considered all these villages together and applied the samerate of compensation. The base rate was initially taken by theReference Court to be Rs.15 lakhs in terms of the decision ofthe High Court in Pran Sukh’s case and later to be Rs.20 lakhsas per the decision of this Court. The High court on all threeGoccasions had based its assessment taking base rate in Pran Sukh’scase to be the starting point. The sale deeds Exts.P1, P2 and P3indicate that even after the initiation of acquisition in Pran Sukh’scase which was in 1994, the valuation of the lands was still at alower level. On the other hand, the valuation in respect of Ext.P-8 has shown some increase. [Para 21, 22][594-F-G; 595-A-D, F]H

1.2 As regards lands in Naharpur Kasan and Kasan, Exh.PY dated 28.04.2004 having been ruled out of consideration, thereare 3 sale instances namely Exh. P4, P6 and P8. Exh. P6 dated16.09.1994 pertained to land having an extent of 12 acres, a fairlylarge area, where the value was Rs.20.00 lakhs per acre. Thisvalue is equal to the one which was granted by this Court in thecase of Pran Sukh’s case for the acquisition of 1994. The nextsale deed namely Exh.P8 dated 29.09.1996 pertained to very smallpiece of land which was less than ½ acre and the value was in theregion of 25.00 lakhs per acre. Without effecting any deductionon account of smallness of the plot and considering the values asthey stand, it shows an increase of 25% over a period of twoyears, i.e. to say @ 12.5% per annum. This is one indication as tothe nature of increase in price after 1994. There is another saleinstance namely Exh. P4 dated 18.08.2003 which was after a yearand half from the dates of Notifications issued under Section 4 inthe instant matter. If the very same rate of increase, though thisCourt in the decision in ONGC Ltd.’s case had ruled that whilededucting from a post-acquisition instance and working backwardsthe rate of deduction ought to be higher, is adopted in the instantmatter, 18.75% will have to be deducted from the price whichwas prevalent in August 2003 to arrive at the corresponding valuefor the period when the present acquisition was initiated. Therate of Rs.48,66,666/- per acre, as available from Exh.P4, againwithout effecting any deductions for the smallness of the plot,must for the purposes of calculation suffer a deduction of Rs.9.12lakhs @ 18.75%. A figure of Rs. 39,54,666/- per acre is arrivedat as the prevalent price in the year 2002. This price is arrived atfirst by considering the rate of deduction which the valuerepresenting the sale instance of August 2003 must suffer andsecondly after effecting appropriate deduction, arrive at theappropriate value for the present purposes. This is Method no.1.[Para 23][595-G; 596-A-D]

1.3 The acquisition in Pran Sukh’s case was of the year1994 and the award of rate therein corresponds with the rateavailable on record through Exh.P6. Exh.P8 and P4, may indicatethe rise in values. However in both instances, the lands werevery small plots i.e. of an extent of less than half an acre. If the AB

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Aprices are to be compared in real terms, the values representingin two sale deeds Exh.P4 and P8 must be re-worked after effectingappropriate deduction. Normally the deductions can range from20% upwards. The lowest of the quotient namely 20% is taken.On that basis, over a period of two years i.e. between Pran Sukh’scase and Exh.P8 there would be no difference at all and the valuesBwould show the same rate. If the rate available from Exh.P4 issubjected to deduction of 20%, the corresponding value for alarger extent of land would be Rs.38.93 lakhs per acre. Thedifference between this value and the base value awarded in PranSukh’s case would then show the rise over a period of 7 years.CIn other words, the price of Rs.20.00 lakhs rose byRs.18.93 lakhs in seven years that is to say it rose by 94.65%giving an annual average of 13.52%. This rate represents pureincrease on non-cumulative basis. If the rate is adopted, thebase price as awarded in Pran Sukh’s case would have risen to the level of Rs.36.22 lakhs per acre. This is Method no.2.D[Para 24][596-F-G; 597-A-C]

1.4 The instances representing Exh. P1, P2 & P3 as wellas P6, do not show any increase at all as against the base rate asawarded in Pran Sukh’s case and the rise in Exh.P4 & P8 is alsonot substantial. Going by the law laid down by this Court on ONGCELtd’s case the cumulative increase of 8% over the base rate asavailable in Pran Sukh’s case would give the correct picture as tothe rise in values in the area comprising of villages NaharpurKasan and Kasan. These calculations would show thecorresponding value for the year 2002 at Rs.37,01,860/- per acre.FThis is Method no.3. If the figures arrived at through these three-methods are compared, the values of Rs. 39,54,666/ per acreunder Method no.1, Rs.36.22 lakhs under Method no.2 andRs.37.01 lakhs under Method no.3 are quite comparable. Takingthe highest of these three figures, the appropriate value for the-lands in Naharpur Kasan and Kasan would be Rs. 39,54,666/Gper acrein the year 2002. Additionally all statutory benefits wouldbe payable.[Paras 25, 26, 30][597-D, G; 598-A-B]

1.5 The values in other three villages namely Bas Kusla,Bas Haria and Dhana have not shown any such increase. Apartfrom sale deeds nothing has been placed on record, insofar asH

said villages are concerned. Even for these villages the base rateof Rs.20.00 lakhs may be adopted for the year 1994 and thenconsider the appropriate increase. As the sale deeds in respectof lands coming from these villages have not shown any increaseat all, by way of rough and ready method half the rise as shown inthe lands coming from villages Naharpur Kasan and Kasan maybe adopted. Half the difference between Rs.20.00 lakhs as thebase rate and Rs.39,54,666/- per acreadopted for the villages ofNaharpur Kasan, Kasan and Manesar would mean differenceof Rs. 9,77,333/-over the base figure of Rs.20.00 lakhs as awardedin Pran Sukh’s case[. ]Thus, the market value of lands fromvillages Bas Kusla, Bas Haria and Dhana in 2002 must be atRs. 29,77,333/- per acre. Additionally all statutory benefits wouldbe payable. [Para 27, 30][598-C-D; 599-F]

1.6 In respect of lands coming from village Manesar, theHigh Court had granted 50% rise over and above the marketvalue in respect of villages Naharpur Kasan and Kasan. Theincrease to that extent was well justified as the lands in villageManesar are abutting National Highway No.8 with excellentcommercial potential. The grant of 50% rise is not seriouslyobjected by the State and as such the same is confirmed.Thus, 50% rise over the figures as applicable to villagesNaharpur Kasan and Kasan would lead to the market value in-respect of village Manesar which would be Rs. 59,31,999/ peracre. Additionally all statutory benefits would be payable.[Paras 28, 30][598-E-F; 599-F]

1.7 Normally the additional component of compensation interms of Section 23(1)(thirdly) of the Act is granted when, alandholder suffers damage as a result of acquisition to the extentthat the holding that he is left with stands comparativelydiminished in terms of quality and value. For instance, if a railwaytrack is to be built through an agricultural land held by a person,leaving two different halves with him, it would be impossible forhim to carry on agricultural operations at an optimum level. Thiswould lead to reduction in the value of the halves that he is leftwith. On the other hand, in a case where part of the holding isacquired for which appropriate commercial value is awarded, therest of the value of the land will not stand diminished in terms of A

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Acommercial potential. On the other hand, the potential of theremainder of the land would also increase drastically as thedevelopment would be right in the neighbourhood, thus givingsubstantial benefit to the landholder. The High Court was notjustified in granting further compensation of 30% to M/s. KPrivate Limited on account of severance charges. Therefore, noBseverance charges need be awarded to M/s. K Private Limited.[Para 29][599-A-D]

Haryana State Industrial Development Corporation v.Pran Sukh & Ors. (2010) 11 SCC 175 ; Haryana StateIndustrial Development Corporation Limited v. UDALCand others (2013) 14 SCC 506 ; Satish Kumar Guptaand others v. State of Haryana and others (2017) 4 SCC760 : [2017] 1 SCR 767 ; General Manager, Oil andNatural Gas Corporation Limited. v. RameshbhaiJivanbhai Patel and Another (2008) 14 SCC 745 :D[2008] 11 SCR 927 ; Lal Chand v. Union of India andanother (2009) 15 SCC 769 : [2009] 13 SCR 622 ;Surender Singh v. State of Haryana and others (2018)3 SCC 278 : [2018] 1 SCR 581 – referred to.

From the Judgment and Order dated 09.03.2018 of the HighCourt of Punjab and Haryana at Chandigarh in R.F.A. Nos. 4158, 4177,G4674, 4235, 4236, 4740 of 2010 and 6957 of 2011.

WITH

Civil Appeal Nos. 338, 333-335, 336-337, 272-332, 339, 271,340-341, 342, 593-617 and 343-592 of 2019, S.L.P. (Civil) Nos. 4354-4358 of 2019.H

Alok Sangwan, AAG, Abhinash Jain, Asst. AG, Dhruv Mehta,Ms. Kiran Suri, R. S. Suri, Sr. Advs., Jasbir Singh Malik, B. P. SinghDhakre, Shakti Dhakre, Ms. Usha Nandini. V, Dr. Monika Gusain, SunnyKadiyan, Siddharth Batra, Ravinder Kumar, Vishwajeet Arora,Ms. Garima Sehgal, S. K. Sinha, Rattan Lal, Ms. Seema Kashyap S. J.Amith, Dr. (Mrs.) Vipin Gupta, Ms. Aishwarya Kumar, Rohit K.Aggarwal, Aditya Giri, Abhishek Singh, Anil Mittal, Vibhuti Sushant Gupta,Satish K. Gupta, Ram Naresh Yadav, Advs. for the appearing parties.

The Judgment of the Court was delivered by UDAY UMESH LALIT, J. 1. Leave granted.

2. The landholders and HSIIDC[1] have filed these cross appealschallenging the final judgment and order dated 09.03.2018 passed by theHigh Court of Punjab and Haryana at Chandigarh in RFA No.2373 of2010 (O&M) titled Madan Pal (III) v. State of Haryana and another andin all connected matters. Since all these matters arise out of the sameacquisition proceedings, they are dealt with together by this commonJudgment.

3. About 1500 acres of land was notified under Section 4 of theLand Acquisition Act, 1894 (hereinafter referred to as ‘the Act”) for thepublic purpose of development of Industrial Model Township, Manesar,Gurgaon Phases II, III and IV by three separate notifications. Theproposed acquisition was:-

i) re: Phase II

About 177 Acres 5 Kanal 19 Marla situated in the Revenue Estateof Villages Kasan, Bas Kusla, Naharpur Kasan and Manesar,Tehsil and District Gurgaon was notified on 06.03.2002.

(ii) re: Phase III

About 598 Acres 5 Kanal 12 Marla situated in the RevenueEstate of Villages Bas Kusla, Kasan, Bas Haria and Dhana,Tehsil and District Gurgaon was notified on 07.03.2002.

(iii) re: Phase IV

About 657 Acres 4 Kanal 3 Marla situated in the Revenue Estateof villages Bas Kusla, Bas Haria, Dhana and Kasan, Tehsil andDistrict Gurgaon was notified on 26.02.2002.

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4. Appropriate declarations under Section 6 of the Act were issuedby the State Government in respect of said lands under Phases II, IIIand IV on 15.11.2002, 25.11.2001 and 18.11.2002 respectively.Thereafter:

(i) In respect of lands proposed to be acquired for Phase II, AwardNo.5 of 2003 was passed by the Sub-Divisional Officer (C)-cum-BLand Acquisition Collector, Gurgaon on 22.07.2003 and thecompensation awarded to the land owners for different types oflands was as under:

Kinds of Land and rates per acreVillageChahiBanjarGair MumkinKasan5,25,000/-5,00,000/-7,50,000Bas 2,25,000/- 1,75,000/- 3,60,000/- Kusla Naharpur 5,25,000/- 4,00,000/- 7,20,000/- KasanManesar7,00,000/-7,00,000/-10,00,000/- C

The extent of lands under various categories in the aforesaidvillages was set out in the award as under:

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Name of Kinds of LandTotalvillage ChahiGair MumkinBanjarKanalMarlaKasan210-0819-07022915Bas Kusla 752-1847-17080015Naharpur 52-120-0205214KasanManesar272-0016-0509-0729712Grand 1287-83-1109-07138016Total 18

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(ii) In respect of lands in Phase No.III, Award No.1 of 2003 waspassed by the Sub-Divisional Officer (C)-cum-Land AcquisitionCollector, Gurgaon on 24.12.2003 and the compensation awardedto the land owners for different types of lands was as under:

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WAZIR & ANR. v. STATE OF HARYANA[UDAY UMESH LALIT, J.]

The extent of lands under various categories in the aforesaidvillages was set out in the award as under:

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Name of Kinds of landTotalVillage ChahiGair MumkinKanalMarlaKMKMKasan 1602823411183619BBas Kusla9556321198717Bas Haria16315271662Dhana174045810179814Grand 44611332719478912Total

(iii) In respect of lands in Phase No.IV, Award No.6 of 2004 waspassed by the Sub-Divisional Officer (C)-cum-Land AcquisitionCollector, Gurgaon on 20.05.2004 and the compensation awardedto the land owners for different types of lands was as under:

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The extent of lands under various categories in the aforesaidvillages was set out in the award as under:

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Name of Kinds of landTotalVillage ChahiGair MumkinKanalMarlaKMKMBas Kusla 1619 13 75 16 1695 9 Bas Haria8749301090419Dhana140248913149117Kasan1035513213116718Grand 4931 11 328 12 5260 3 Total F

5. Aggrieved and dissatisfied, the land owners filed referencesunder Section 18 of the Act. Said references as regards lands acquiredfor Phases II and III were dealt with as under:- G

(i) In respect of lands acquired for Phase No.III, in LAC CaseNo.513 of 2004 and other connected matters, the Reference Courtpassed an order on 16.12.2009 enhancing the compensation toRs.28,15,849/- per acre with solatium and interest on the H

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Acompensation amount at applicable rates. The Reference Courtrelied upon the decision of the High Court in Pran Sukh etc. v.State of Haryana which related to acquisition for the same purposeof setting up an Industrial Model Township, Manesar pursuant tonotification under Section 4 of the Act issued on 15.11.1994, wherethe High Court had assessed the compensation at the rate ofBRs.15 lakhs per acre. The Reference Court granted 12% increaseper annum on the rate at which compensation was awarded inPran Sukh by the High Court and arrived at the rate ofRs.28,15,356/- per acre which was a common rate for all kinds oflands.

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(ii) In respect of lands acquired for Phase II, in LAC Case No.164of 2004 and other connected matters, the Reference Court[2]passed an order on 27.01.2010 enhancing the compensation toRs.28,15,356/- per acre with solatium and interest on thecompensation at applicable rates. Reliance was placed on theearlier decision dated 16.12.2009 of the Reference Court. TheCompensation was awarded at the same rate for all kinds of lands.

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6. While the reference applications in respect of Phase IV werepending before the Reference Court, the appeal arising from the decisionof the High Court in Pran Sukh was decided by this Court on 17.08.2010.This Court[2] determined the market value of the land, where notification E

was issued under Section 4 on 15.11.1994, to be Rs.20 lakhs per acre.Under said notification, 1490 acres of land from villages Manesar,Naharpur Kasan, Khoh and Kasan was acquired. This Court found thatthe High Court was right in relying upon the sale deed dated 16.09.1994(Ext.P1) but held that the High Court was not right in imposing a cut ofF20% and 25%. It held that all the lands would be assessed at the rate ofRs.20 lakhs per acre.

7. The reference applications in respect of Phase IV werethereafter taken up for consideration. Relying upon the decision of thiscourt in Pran Sukh[3] the Reference Court in its order dated 30.11.2010in LAC Case No.263 of 2008 and other connected matters enhancedGthe compensation to Rs.37,40,230/- per acre. While so awarding, theReference Court granted enhancement at the rate of Rs.12% per annum 2 the Additional District Judge, Gurgaon 3 (2010) 11 SCC 175 (Haryana State Industrial Development Corporation v. Pran SukhH& Ors.)

taking the base rate to be Rs.20 lakhs per acre as on 15.11.1994 in termsof the decision of this Court in Pran Sukh[3]. The Reference Court alsoawarded solatium and interest on the compensation amount at applicablerates. It awarded compensation at the same rate for all kinds of lands.

8. In respect of acquisitions for Phases II and III wherecompensation was awarded at the rate of Rs.28,15,356/- per acre asmentioned hereinabove, RFA No.2373 of 2010 titled Madan Pal v. Stateof Haryana and all connected matters were preferred in the High Court.Said appeals were disposed of by the High Court by its judgment andorder dated 11.02.2011. Relying on the decision of this Court in PranSukh[3] it was observed by the High Court in paras 22 and 29 as under:

“22. The issue under consideration in the present set of appeals isregarding determination of the value of land acquired for thepurpose of development as Phase-II and Phase-III of IndustrialModel Township, Manesar. The notification under Section 4 ofthe Act for Phase-II was issued on 06.03.2002, whereas for Phase-III, the same was issued on 07.03.2002. For Phase-II, the totalacquired land was 1380 kanals and 16 marlas, whereas for Phase-III, the same was 4789 kanals and 12 marlas. The entire land is acompact block. It is adjoining to the land already acquired fordevelopment as Phase-I in the year 1994. The village, of whichthe lands was acquired, are common in the acquisition or arecontiguous as after crossing the boundaries of one village, theabutting land of the next revenue estate was acquired. It wasalso contended at the time of hearing that almost at the sametime, land for development as Phase-IV was also acquiredadjoining to the land in question by notification under Section 4 ofthe Act issued on 26.02.2002, the area being 567 acres 4 kanalsand 3 marlas. Even subsequent thereto, for development as Phase-V in the same area, 956 acres, 5 kanals and 18 marlas of landwas acquired vide notification under Section 4 of the Act issuedon 17.09.2004.

29. From the appreciation of evidence produced on record, in myopinion, the price of the agricultural land, which was acquired inthe year 1994, as determined by Hon’ble the Supreme Court inPran Sukh’s case (supra) can very well be taken as base forassessment of value of the acquired land, which also on the dateof notification was being put to agricultural use. The additionaladvantage available at the time of acquisition of the land in question A

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Awas that the area in the vicinity had started developing duringinterregnum of 7-8 years after the first acquisition in the year1994. The value of the land, which was being put to agriculturaluse and was in the vicinity of the land already acquired cannot bedetermined at the same rate at which the plots were being sold byway of allotment or auction in the already developed area butBthose prices are certainly the guiding factors for determination ofrate at which the increase should be awarded, which in my opinion,should be @ 12% per annum. Taking the same into account andconsidering the time gap in the two acquisitions being 7 years and3 months, the value of the land is determined at Rs.37,40,000/-Cper acre. The land owners shall also be entitled to the statutorybenefits available to them under the Act.”

However, as regards land held by M/s Kohli Holdings PrivateLimited, the compensation was awarded at the rate of Rs.1.02 croresper acre on the grounds that said land had frontage of two acres onDNational Highway No.8 and that on the back side there was connectionfrom a link road.

9. The aforesaid judgment of the High Court passed on 11.02.2011was challenged in Civil Appeal Nos.4843-4940 of 2013 before this Court.In its decision in Haryana State Industrial Development CorporationLimited v. UDAL and others[4], this Court noted the contention of HSIIDCEin para 22 and then concluded in paras 29 and 30 as under: -

“22. Although in the special leave petitions filed by HSIIDC severalgrounds have been taken for challenging the judgment of thelearned Single Judge, the only point urged by Shri Parag P. Tripathi,learned Senior Counsel appearing on its behalf is that the escalationFof 12% granted by the learned Single Judge in the amount ofcompensation determined by this Court in Pran Sukh case isexcessive and is not in consonance with the law laid down by thisCourt. He relied upon the judgment of this Court in ONGC Ltd. v.Rameshbhai Jivanbhai Patel (2008) 14 SCC 745 and arguedthat while assessing market value of a large chunk of land, theGCourt cannot award more than 7.5% escalation in the marketvalue determined in respect of similar parcels of land. The learnedSenior Counsel emphasised that HSIIDC had to spend a substantial amount on carrying out development and argued that this factorshould have been taken into consideration by the learned SingleJudge while fixing market value of the acquired land. Shri Tripathialso criticised the impugned judgment insofar as it relates to theaward of compensation at the rate of Rs 1,02,55,960 per acre inthe case of M/s Kohli Holdings (P) Ltd. by arguing that in view ofseveral statutory restrictions on the development of land alongNational Highway 8, the landowners could not have been awardedhigher compensation.

29. A careful scrutiny of the impugned judgment shows that whiledetermining the amount of compensation payable to the landownersother than M/s Kohli Holdings (P) Ltd., the learned Single Judgedid make a reference to Ext. P-38 (para 30) but did not rely uponthe same for the purpose of determination of the amount ofcompensation. Instead of adopting a holistic approach andexamining the documents produced before the Reference Court,the learned Single Judge simply referred to the judgment of thisCourt in Pran Sukh case, granted a flat increase of 12% for thetime gap of about 7 years and 3 months between the twoacquisitions i.e. 1994 and 2002 and determined market value atthe rate of Rs 37,40,000 per acre. In the case of M/s Kohli Holdings(P) Ltd., the learned Single Judge squarely relied upon Ext. P-38for the purpose of fixing market value of the acquired land, grantedan increase at a flat rate of 15% per annum on the price of landspecified in Ext. P-38 with an addition of 30% on account ofspecial locational advantage and held that the particular landowneris entitled to compensation at the rate of Rs 2119 per square yard(Rs 1,02,55,960 per acre). However, no discernible reason hasbeen given for granting the benefit of annual increase at differentrates to M/s Kohli Holdings (P) Ltd. on the one hand and theremaining landowners on the other. Therefore, we find merit inthe argument of the learned counsel for the remaining landownersthat their clients have been subjected to discrimination in the matterof grant of annual increase.

30. The other error committed by the learned Single Judge is thathe granted annual increase at a flat rate of 12/15%.”

This Court therefore allowed the appeals and remanded the mattersback to the High Court for fresh disposal. Further, liberty was given toMaruti Suzuki India Limited, namely, one of the beneficiaries of the AB

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Aacquisition to file an application for impleadment in the pending appealsbefore the High Court.10. Post remand, the High Court by its judgment and order dated06.10.2015 passed in RFA No.2373 of 2010 titled Madan Pal (II) v.State of Haryana and in all connected matters, remanded the casesBback to the Reference Court for fresh disposal. It was found that theacquiring authority had not defended the matters properly and thebeneficiary of the acquisition ought to be given chance to place the materialbefore the Court. It, therefore, permitted Maruti Suzuki India Limited tolead evidence in the Reference Court. Liberty was also given to all theparties to produce relevant evidence in support of their submissions.CThis judgment of the High Court was again challenged before this Courtin Civil Appeal Nos.1587-1636 of 2017 and in all connected matters. Inits decision in Satish Kumar Gupta and others v. State of Haryanaand others[5] and in all connected matters, this Court held that the post-acquisition allottee, namely, Maruti Suzuki India Limited could not be Dtreated as a necessary or proper party while determining mattersconcerning compensation. It, therefore, set aside the judgment and orderdated 06.10.2015 passed by the High Court and remanded the casesback to the High Court for deciding the cases afresh.

11. Thereafter, the matters were taken up for fresh considerationby the High Court. In support of the plea for enhancement inEcompensation, reliance was placed by the landholders on followingexemplars :- ExhibitsDateArea/Sale Value per Village Consideration acre in R s. in Rs. Ex.P1 12.06.1997 2 kanals / 2,00,000/- 8 lakhs FBas Kusla Ex.P2 23.06.1997 1 kanal 10 marlas 4,50,000/- 8 lakhs / B as KuslaEx.P318.09.199718 kan als/ D hana14,28,750/-6,35,000/-Ex.P4 18.08.2003 1 kanal 4 7,30,000/- 48,66,666/- Marlas/ Kasan Ex.P6 16.09.1994 96 kanals 13 2.42 crores 20 lakhs marlas (12.081 Gacres)/Naharpur Kasan Ex.P8 20.09.1996 1 kanal 1½ 3,53,000/- 25 lakhs marla/ Naharpur KasanEx.PY 28.04.2004 96 kanals 13 13.62 crores 1.13 crores marlas/ Naharpur HKasan5 (2017) 4 SCC 760

Apart from the aforesaid exemplars, certain allotments ofdeveloped pieces of land namely Ext.P4 in favour of Orient Craft Ltd.dated 02.02.2002, Ext.P11 dated 30.09.1999 in favour of Krishna MarutiLtd., Ext.P14 dated 07.08.2002 in favour of M/s Royal Tool, etc., werealso relied upon. Submission was also made that taking the rate of Rs.20lakhs per acre as held by this Court in Pran Sukh[3] to be the prevalentrate in 1994, enhancement at 15% could also be considered to arrive atthe appropriate rate for the year 2002.

On the other hand, a prayer was made on behalf of HSIIDC andthe State to permit them to place on record certain sale deeds of 1994and 2002 by way of additional evidence in support of the plea thatcompensation awarded by the Reference Court was on the higher side.The prayer to lead additional evidence was however rejected by theHigh Court.

12. The High Court observed that reliance on the allotment lettersof various industrial plots or the instances of auction sales would not bea safe parameter to assess the market value. The High Court thenconsidered cumulative increase in the price considering the rate of Rs.20lakhs as awarded by this Court in Pran Sukh[3] to be the base rate. Outof the sale deeds on record, it considered Ext.P8 dated 20.09.1996 infavour of Times Masters India Pvt. Ltd. to be the most appropriateexemplar, and at the same time it also computed the figures by givingcumulative enhancement at the rates of 12% and 15% over the baserate of Rs.20 lakhs per acre as awarded by this Court in Pran Sukh[3](supra). Thereafter, cut of 10% and 20% was also applied. Paragraphs95, 96, 97, 98 of the judgment were:- “95. Thus, if cumulative benefit by way of 12% cumulativeincrease is to be given on the base price of Rs.20 lakhs from 1994

to 2001 enhancement would come to as under:- Y ea rP rin c ip a lE n h a n ce dT o ta l a m o u n t A m o u n t (R s .)A m o u n t (R s. )( R s .) 1 9 9 4 2 0 ,0 0 ,0 0 0 .0 0 - - 2 0 , 0 0 ,0 0 0 . 0 0 1 9 9 5 2 0 ,0 0 ,0 0 0 .0 0 2 ,4 0 , 0 0 0 .0 0 2 2 , 4 0 ,0 0 0 . 0 0 1 9 9 62 2 ,4 0 ,0 0 0 .0 02 ,6 8 , 8 0 0 .0 02 5 , 0 8 ,8 0 0 . 0 01 9 9 7 2 5 ,0 8 ,8 0 0 .0 0 3 ,0 1 , 0 5 6 .0 0 2 8 , 0 9 ,8 5 6 . 0 0 1 9 9 8 2 8 ,0 9 ,8 5 6 .0 0 3 ,3 7 , 1 8 2 .7 2 3 1 , 4 7 ,0 3 8 . 7 2 1 9 9 93 1 ,4 7 ,0 3 8 .7 23 ,7 7 , 6 4 4 .6 53 5 , 2 4 ,6 8 3 . 3 72 0 0 0 3 5 ,2 4 ,6 8 3 .3 7 4 ,2 2 , 9 6 2 .0 0 3 9 , 4 7 ,6 4 5 . 3 7 2 0 0 1 3 9 ,4 7 ,6 4 5 .3 7 4 ,7 3 , 7 1 7 .4 4 4 4 , 2 1 ,3 6 2 . 8 1

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Cut on the amount of Rs.44,21,362 @ 10% (Rs.4,42,136):39,79,226/- Cut on the amount of Rs.44,21,362 @ 20% (Rs.8,84,272/-):35,37,090/-

96. Similarly, if the enhancement is to be granted @ 15% on Rs.20lakhs from 1994 to 2001, it works out as under:- YearPrincipalEnhancedTotal amount Amount (Rs.)Amount (Rs.) (Rs.) 199420,00,000.00--20,00,000.00199520,00,000.003,00,000/-23,00,000.001996 23,00,000.00 3,45,000/- 26,45,000.00 199726,45,000.003,96,750.0030,41,750.00199830,41,750.004,56,262.5034,98,012.50199934,41,750.005,24,701.8740,22,714.37200040,22,714.375,70,328.1246,26,121.52200146,26,121.526,93,918.2353,20,039.76

Cut on the amount of Rs.53,20,039 @ 10% (Rs.5,32,003/-):47,88,036/- Cut on the amount of Rs.53,20,039 @ 20% (Rs.10,64,007/-):42,56,032/-

97. Similarly, if the benefit of 12% cumulative increase is to begiven on the sum of Rs.25 lakhs after the sale deed from 1996(Ex.P8) in favour of Times Master India Private Limited to 2001enhancement would come to as under:- YearPrincipalEnhancedTotal amount Amount (Rs.)Amount (Rs.) (Rs.) 199625,00,000.00--25,00,000.00199725,00,000.003,00,000.0028,00,000.001998 28,00,000.00 3,36,000.00 31,36,000.00 199931,36,000.003,76,320.0035,12,320.00200035,12,320.004,21,478.4039,33,798.40200139,33,798.404,72,055.8144,05,854.21

Cut on the amount of Rs.44,05,854 @10 (Rs.4,40,585/-) :39,65,269/- Cut on the amount of Rs.44,05,854 @ 20% (Rs.8,81,1702/-):35,24,684/- H

WAZIR & ANR. v. STATE OF HARYANA[UDAY UMESH LALIT, J.]

98. For enhancement @ 15% on Rs.25 lakhs from 1996 to 2001,Athe amount works out as under:- YearPrincipalEnhancedTotal amount Amount (Rs.)Amount (Rs.) (Rs.) 199625,00,000.00--25,00,000.00199725,00,000.003,75,000.0028,75,000.001998 28,75,000.00 4,31,250.00 33,06,250.00 199933,06,250.004,95,937.5038,02,187.50200038,02,187.505,70,328.1243,72,515.62

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Cut on the amount of Rs.50,28,392 @ 10% (Rs.5,02,839/-):45,25,553/-

Cut on the amount of Rs.50,28,392 @ 20% (Rs.10,05,678/-):40,22,714/-”.

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13. On the basis of the aforesaid figures, taking average of boththe parameters after giving 15% enhancement but effecting 20% cut,the figure of Rs.41,39,373/- which was rounded off to Rs.41.40 lakhswas taken as the market value for the lands in question as under:- D

“103. Thus, when we compare the enhancement firstly on theprinciple of cumulative increase on the price fixed by the ApexCourt in Pran Sukh (supra) on Rs.20 Lakhs @15% from 1994 till2001, it works out to Rs.53,20,039/-. Similarly, if the enhancementof 15% is given on the basis of the sale deed Ex.P8 in favour ofTime Master India Private Limited from 1996 to 2001, the amountworks out to Rs.50,28,392/-. In case the cut of 20% is applied onthe said amount, the amounts worked out to Rs.42,56,032/- in onecase and Rs.44,22,714/- in other case.

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104. Resultantly, if the average of both the formulas is also workedout the amount after giving 20% cut the average of said formulaswould take the market value to Rs.41,39,373/- and, accordingly,after rounding it off, this Court is of the opinion that Rs.41.40lakhs would be the appropriate market value for the land inquestion.”

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14. The High Court, thus, by its judgment and order dated09.03.2018 passed in RFA No.2373 of 2010 titled Madan Pal (III) v.State of Haryana and in all connected matters assessed the compensationat Rs.41.40 lakhs per acre along with statutory benefits in respect oflands acquired in villages Naharpur Kasan, Kasan, Bas Haria, Bas Kusla G

Aand Dhana (covered by Phases II and III). The compensation in villageManeswar (covered by Phase-IV) was assessed after giving 50%enhancement at Rs.62.10 lakhs per acre along with statutory benefits.As regards M/s Kohli Holdings Pvt. Ltd., additional component of 30%was also awarded on account of severance charges, over and above therate of Rs.62.10 lakhs per acre.B

15. The aforesaid view of the High Court is now under challengein these cross appeals. Mr. Dhruv Mehta and Ms. Kiran Suri, learnedSenior Advocates for the landholders relied upon the allotments ofdeveloped plots as indicators of high potential of the lands. It wassubmitted that even if the rate awarded in Pran Sukh[3] was to be takenCas the base rate, there ought not to have been any cut and secondly, thecompensation ought to have been arrived at till 2002 and not upto 2001as was done by the High Court. Mr. R. S. Suri, learned Senior Advocateappearing for M/s. Kohli Holdings Pvt. Ltd. stressed upon the incongruityin the price awarded presently as against one that was granted on theearlier occasion. He submitted that the lands of his client were on NationalDHighway No.8 and were bestowed with all the advantages and as suchthe price awarded on the earlier occasion was the correct one. Mr.Alok Sangwan, learned Advocate appearing for HSIIDC contended thatthe sale deeds of 1994 and 2002 ought to have been allowed to be placedon record. In his submission the compensation awarded by the HighECourt was on the higher side. In any case, considering the huge extentof land the enhancement ought to have been in terms of law laid downby this Court in General Manager, Oil and Natural Gas CorporationLimited. v. Rameshbhai Jivanbhai Patel and Another[6]and othercases.F16. We must first consider the submissions based on the allotmentsand instances of auction purchases of developed plots effected by theDevelopment Authority itself. These submissions were rightly rejectedby the High Court. The law on the point is well settled as stated in LalChand vs. Union of India and another[7]. We therefore, reject thesesubmissions.G

17. Before we consider other submissions, it must be mentionedthat the assessment made by the High Court in its judgment dated11.02.2011 was not approved by this Court as is evident from its 6 (2008) 14 SCC 745H7 (2009) 15 SCC 769

judgment[4]. This Court recorded the submission made by the learnedcounsel appearing for HSIIDC that 12% cumulative escalation on therate in Pran Sukh[3]itself was excessive and not in consonance with thelaw laid down by this Court and also found that the landholders wereaggrieved by non-consideration of the documents produced before theReference Court as well as the inter se discrimination between M/s.Kohli Holdings Pvt. Ltd. and the other landholders. We must thereforeconsider the matter from two perspectives namely on the strength of thedocuments on record and on the basis of the rate as found in PranSukh[3]to arrive at the appropriate market value.

18. We must also note, at the outset, the governing legal principlesregarding annual increase over a base rate. The law in that behalf hasbeen succinctly stated by this Court in ONGC Limited (supra) in paras10 to 17 under the heading “what should be the increase per annum” asunder:- “10. The contention of the appellant is that even if Ext. 15 shouldbe the basis, in the absence of any specific evidence regardingincrease in prices between 1987 and 1992, the annual increasecould not be assumed to be 10% per year.

11. On the other hand, the learned counsel for the respondentclaimants submitted that the rate of escalation in market value atthe relevant time was in the range of 10% to 15% per annum. Herelied on the decisions of this Court in Ranjit Singh v. UnionTerritory of Chandigarh (1992) 4 SCC 659 and LandAcquisition Officer and Revenue Divisional Officer v.Ramanjulu (2005) 9 SCC 594 wherein this Court had acceptedan escalation of ten per cent per annum, and the decision in KrishiUtpadan Mandi Samiti v. Bipin Kumar (2004) 2 SCC 283 wherethis Court had accepted an escalation of 15% per annum. He,therefore, submitted that escalation at the rate of 10 per centadopted by the Reference Court and approved by the High Courtis a reasonable and correct standard to be applied.

12. We have examined the facts of the three decisions relied onby the respondents. They all related to acquisition of lands in urbanor semi-urban areas. Ranjit Singh (1992) 4 SCC 659 related toacquisition for development of Sector 41 of Chandigarh.

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Ramanjulu (2005) 9 SCC 594 related to acquisition of the thirdphase of an existing and established industrial estate in an urbanarea. Bipin Kumar (2004) 2 SCC 283 related to an acquisition oflands adjoining Badaun-Delhi Highway in a semi-urban area wherebuilding construction activity was going on all around the acquiredlands.

13. Primarily, the increase in land prices depends on four factors:situation of the land, nature of development in surrounding area,availability of land for development in the area, and the demandfor land in the area. In rural areas, unless there is any prospect ofdevelopment in the vicinity, increase in prices would be slow, steadyand gradual, without any sudden spurts or jumps. On the otherhand, in urban or semi-urban areas, where the development isfaster, where the demand for land is high and where there isconstruction activity all around, the escalation in market price isat a much higher rate, as compared to rural areas. In some pocketsin big cities, due to rapid development and high demand for land,the escalations in prices have touched even 30% to 50% or moreper year, during the nineties.

14. On the other extreme, in remote rural areas where there wasno chance of any development and hardly any buyers, the pricesstagnated for years or rose marginally at a nominal rate of 1% or 2% per annum. There is thus a significant difference in increasesin market value of lands in urban/semi-urban areas and increasesin market value of lands in the rural areas. Therefore, if theincrease in market value in urban/semi-urban areas is about 10%to 15% per annum, the corresponding increases in rural areaswould at best be only around half of it, that is, about 5% to 7.5%per annum. This rule of thumb refers to the general trend in thenineties, to be adopted in the absence of clear and specific evidencerelating to increase in prices. Where there are special reasons forapplying a higher rate of increase, or any specific evidence relatingto the actual increase in prices, then the increase to be appliedwould depend upon the same.

15. Normally, recourse is taken to the mode of determining themarket value by providing appropriate escalation over the provedmarket value of nearby lands in previous years (as evidenced by

sale transactions or acquisitions), where there is no evidence ofany contemporaneous sale transactions or acquisitions ofcomparable lands in the neighbourhood. The said method isreasonably safe where the relied-on sale transactions/acquisitionsprecede the subject acquisition by only a few years, that is, up tofour to five years. Beyond that it may be unsafe, even if it relatesto a neighbouring land. What may be a reliable standard if the gapis of only a few years, may become unsafe and unreliable standardwhere the gap is larger. For example, for determining the marketvalue of a land acquired in 1992, adopting the annual increasemethod with reference to a sale or acquisition in 1970 or 1980may have many pitfalls. This is because, over the course of years,the “rate” of annual increase may itself undergo drastic changeapart from the likelihood of occurrence of varying periods ofstagnation in prices or sudden spurts in prices affecting the verystandard of increase.

16. Much more unsafe is the recent trend to determine the marketvalue of acquired lands with reference to future sale transactionsor acquisitions. To illustrate, if the market value of a land acquiredin 1992 has to be determined and if there are no sale transactions/acquisitions of 1991 or 1992 (prior to the date of preliminarynotification), the statistics relating to sales/acquisitions in future,say of the years 1994-1995 or 1995-1996 are taken as the baseprice and the market value in 1992 is worked back by makingdeductions at the rate of 10% to 15% per annum. How far is thissafe? One of the fundamental principles of valuation is that thetransactions subsequent to the acquisition should be ignored fordetermining the market value of acquired lands, as the veryacquisition and the consequential development would acceleratethe overall development of the surrounding areas resulting in asudden or steep spurt in the prices. Let us illustrate. Let us assumethere was no development activity in a particular area. Theappreciation in market price in such area would be slow andminimal. But if some lands in that area are acquired for a residential/commercial/industrial layout, there will be all round developmentand improvement in the infrastructure/amenities/ facilities in thenext one or two years, as a result of which the surrounding lands AB

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Awill become more valuable. Even if there is no actual improvementin infrastructure, the potential and possibility of improvement onaccount of the proposed residential/commercial/industrial layoutwill result in a higher rate of escalation in prices. As a result, if theannual increase in market value was around 10% per annum beforethe acquisition, the annual increase of market value of lands in theBareas neighbouring the acquired land, will become much more,say 20% to 30%, or even more on account of the development/proposed development. Therefore, if the percentage to be addedwith reference to previous acquisitions/sale transactions is 10%per annum, the percentage to be deducted to arrive at a marketCvalue with reference to future acquisitions/sale transactions shouldnot be 10% per annum, but much more. The percentage of standardincrease becomes unreliable. Courts should, therefore, avoiddetermination of market value with reference to subsequent/futuretransactions. Even if it becomes inevitable, there should be greatercaution in applying the prices fetched for transactions in future.DBe that as it may.

17. In this case, the acquisition was in a rural area. There was noevidence of any out of the ordinary developments or increases inprices in the area. We are of the view that providing an escalationof 7.5% per annum over the 1987 price under Ext. 15, would beEsufficient and appropriate to arrive at the market value of acquiredlands.”

19. The instant matter is required to be considered in the light ofthe aforesaid principles. The land under present acquisition is an extentof 1500 acres and from 6 villages i.e. Bas Kusla, Bas Haria, Dhana,FManesar, Naharpur Kasan and Kasan. If the computation which wasaccepted by the Sub-Divisional Officer cum Land Acquisition Collectoris considered, the values of lands in villages Bas Kusla, Bas Haria andDhana were definitely on the lower side as compared to the correspondingvalues from villages like Manesar, Naharpur Kasan and Kasan. In theawards, the maximum value of Rs.10 lakhs per acre was in respect ofGlands from Manesar while those from Naharpur Kasan and Kasan wereRs.7,20,000/- and Rs.7,50,000/-per acre respectively. As compared tothese villages the values in respect of lands in Bas Kusla, Bas Haria andDhana were almost less than 50%. If the extent of land which was subject matter of acquisition is again considered, more than 2/3[rds ]of landsare from villages Bas Kusla, Bas Haria and Dhana. The earlier acquisitionof 1994 which was dealt with in Pran Sukh[3]was with regard to fourvillages, including Manesar, Naharpur Kasan and Kasan. In these villages,the valuation was found to be more than double as compared to villagesBas Kusla, Bas Haria and Dhana. The question then arises whetherthese two sets of villages ought to be given differential treatment orshould they be clubbed and put at the same level.

20. Recently, in the case of Surender Singh v. State of Haryanaand others[8]the acquisition was initiated on 11.01.2005 for acquiring anextent of 520 acres of land from 15 villages in the State of Haryana.Two villages, namely, Kasan and Dhana out of said 15 villages are alsopart of the present acquisition. Relying on the decision of Pran Sukh[3]where compensation was awarded at the rate of Rs.20 lakhs per acreand after granting 8% cumulative increase over rates of 1994, the HighCourt had arrived at the rate of compensation for the entire extent of520 acres. While remanding the matter back to the High Court for freshconsideration it was observed by this Court in paras 26 to 29 as under:

“26. The High Court, however, noticed from the facts involved inPran Sukh[3] that the land situated in one Village Kasan along withits some adjoining villages was acquired on 15-11-1994 by theState and this Court determined the compensation payable to thelandowners of Kasan Village @ Rs 20,00,000 per acre.

27. The High Court felt that Rs 20,000,00 per acre should betaken as the base price for determining the rate of acquired landin question. The High Court perhaps did this after having noticedthat some part of the acquired land in these appeals is situated inKasan Village and, therefore, it is ideal to take the rate of KasanVillage land as basis for determining the rate of acquired landalso. The High Court accordingly gave annual increase of 8% toRs 20,00,000 and worked out the rate at Rs 62,11,700 per acre forthe entire acquired land in question by applying one uniform rate.

28. In our considered opinion, the approach of the High Court inthe facts of these cases does not appear to be right inasmuch asthe High Court failed to take into consideration several material 8 (2018) 3 SCC 278

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Aissues which arose in these cases and had a bearing ondetermination of the fair market rate of the land in question underSection 23 of the Act:

28.1. First, the acquired land, in these cases, was a huge chunkof land measuring around 520 acres, 2 kanals and 13.5 marlas.

B28.2. Second, the entire acquired land was not situated in VillageKasan but it was spread over in 15 villages as detailed above.

28.3. Third, there is no evidence to show much less any findingof the High Court as to what was the actual distance among the15 villages against one another, the location, situation/area of eachCvillage, whether any development had taken place and, if so, itstype, nature and when it took place in any of these villages, thepotentiality and the quality of the acquired land situated in eachvillage, its nature and the basis, the market rate of the land situatedin each village prior to the date of acquisition or in its near proximity,whether small piece of land or preferably big chunk of land, theDactual distance of each village qua any other nearby big developedcity, town or a place, whether any activity is being carried on inthe nearby areas, their details.

28.4. Fourth, whether the acquired land in Pran Sukh[3] in VillageKasan and the acquired land in question are similar in nature orEdifferent and, if so, how and on what basis, their total distance,etc.

29. These were, in our view, the issues which had material bearingwhile determining the rate of the acquired land in question.”

21. In the instant case, the sale deeds Exts.P1, P2 and P3 reliedFupon by the landholders pertained to lands from villages Bas Kusla andDhana and were of the year 1997 that is after the acquisition was initiatedin Pran Sukh[3]. The maximum value per acre in these villages was Rs.8lakhs per acre and that too with respect to smaller plots. The sale deedsExts.P4, P6, P8 and PY however pertained to lands coming from villagesNaharpur Kasan and Kasan. Ext.PY dated 28.04.2004 was much afterGthe acquisition was initiated in the present case. Secondly, as found bythe High Court in para 74 of its judgment, there was construction andCLU was also obtained in relation to land in Ext. PY. For these reasonsthe High Court had rightly ruled out said transaction. At the same time H

Ext.P4 was also after the acquisition in the present case was initiatedand pertained to a small plot of land. Out of these four sale deeds, Ext.P8is prior in point of time so far as the present acquisition is considered andwas therefore rightly relied upon as the most appropriate exemplar bythe High Court. If the value in Ext.P8 is compared with the maximumvalue under Exts.P1, P2 and P3 there is a marked difference. Thisdifference is again consistent with the valuation that was accepted bythe Sub-Divisional Officer cum Land Acquisition Collector. Since majorpart of the land under acquisition that is more than T![rds ]is from villagesBas Kusla, Bas Haria and Dhana, one way of assessing the correctvalue of compensation is to treat these three villages on one side whileother three villages on the other side.

22. However, not only the Reference Court but the High Court onthree different occasions had considered all these villages together andapplied the same rate of compensation. The base rate was initially takenby the Reference Court to be Rs.15 lakhs in terms of the decision of theHigh Court in Pran Sukh and later to be Rs.20 lakhs as per the decisionof this Court. The High court on all three occasions had based itsassessment taking base rate in Pran Sukh[3]to be the starting point. Wemust also note that in Pran Sukh[3], this Court had also applied uniformrate for the entirety of the extent of 1490 acres of land coming from fourdifferent villages. It would therefore be inappropriate at this stage tomake a distinction between these two sets of villages for the purposesof base rate. But this point will certainly be of relevance when weconsider the ratio of escalation. The sale deeds Exts.P1, P2 and P3indicate that even after the initiation of acquisition in Pran Sukh[3]casewhich was in 1994, the valuation of the lands was still at a lower level.On the other hand, the valuation in respect of Ext. P-8 has shown someincrease.

23. As regards lands in Naharpur Kasan and Kasan, Exh. PYdated 28.04.2004 having been ruled out of consideration, we are nowleft with 3 sale instances namely Exh. P4, P6 and P8. We may firstconsider pre-acquisition instances namely Exh. P6 & P8. Exh. P6 dated16.09.1994 pertained to land having an extent of 12 acres, a fairly largearea, where the value was Rs.20.00 lakhs per acre. This value is equalto the one which was granted by this Court in the case of Pran Sukh[3]for the acquisition of 1994. The next sale deed namely Exh.P8 dated29.09.1996 pertained to very small piece of land which was less than A

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A½ acre and the value was in the region of 25.00 lakhs per acre. Withouteffecting any deduction on account of smallness of the plot and consideringthe values as they stand, it shows an increase of 25% over a period oftwo years, i.e. to say @ 12.5% per annum. This is one indication as tothe nature of increase in price after 1994.BWe have another sale instance namely Exh. P4 dated 18.08.2003which was after a year and half from the dates of Notifications issuedunder Section 4 in the present matter. If the very same rate of increase,though this Court in the decision in ONGC Ltd. (supra) had ruled thatwhile deducting from a post-acquisition instance and working backwardsthe rate of deduction ought to be higher, is adopted in the present matter,C18.75% will have to be deducted from the price which was prevalent inAugust 2003 to arrive at the corresponding value for the period whenthe present acquisition was initiated. The rate of Rs.48,66,666/- per acre[9],as available from Exh.P4, again without effecting any deductions for thesmallness of the plot, must for the purposes of calculation suffer aDdeduction of Rs.9.12 lakhs @ 18.75%. We thus arrive at a figure ofRs.39,54,666/- per acre[10] as the prevalent price in the year 2002. Thisprice is arrived at first by considering the rate of deduction which thevalue representing the sale instance of August 2003 must suffer andsecondly after effecting appropriate deduction, arrive at the appropriate

value for the present purposes. We may call this Method no.1.E24. We now consider the matter from a different perspective andtake the rate awarded in Pran Sukh[3] as the basis and then try to arriveat the appropriate value for the present acquisition. For this purpose, wemay have to determine the rate of increase as shown by the sale deedson record. The acquisition in Pran Sukh[3] was of the year 1994 and theFaward of rate therein corresponds with the rate available on recordthrough Exh.P6. We have two instances of Exh.P8 and P4, which mayindicate the rise in values. However in both instances, the lands werevery small plots i.e. of an extent of less than half an acre. If the pricesare to be compared in real terms, the values representing in two saledeeds Exh.P4 and P8 must be re-worked after effecting appropriateGdeduction. Normally the deductions can range from 20% upwards. Wemay however take the lowest of the quotient namely 20%. On that 9 The figure was corrected in terms of Order dated 08.02.2019 in MA No. 299/2019.

H10 The figure was corrected in terms of Order dated 08.02.2019 in MA No. 299/2019.

WAZIR & ANR. v. STATE OF HARYANA[UDAY UMESH LALIT, J.]

basis, over a period of two years i.e. between Pran Sukh[3] and Exh.P8there would be no difference at all and the values would show the samerate. If the rate available from Exh.P4 is subjected to deduction of 20%,the corresponding value for a larger extent of land would be Rs.38.93lakhs per acre. The difference between this value and the base valueawarded in Pran Sukh[3] (supra) would then show the rise over a periodof 7 years. In other words, the price of Rs.20.00 lakhs rose by Rs.18.93lakhs in seven years that is to say it rose by 94.65% giving us an annualaverage of 13.52%. This rate represents pure increase on non-cumulativebasis. If we adopt the rate, the base price as awarded in Pran Sukh[3]would have risen to the level of Rs.36.22 lakhs per acre. We may callthis Method no.2.

25. The instances representing Exh. P1, P2 & P3 as well as P6,as a matter of fact do not show any increase at all as against the baserate as awarded in Pran Sukh[3] and the rise in Exh.P4 & P8 is also notsubstantial. Going by the law laid down by this Court on ONGC Ltd.(supra) in our considered view, the cumulative increase of 8% over thebase rate as available in Pran Sukh[3] would give us the correct pictureas to the rise in values in the area comprising of villages Naharpur Kasanand Kasan. The tabulated chart in that regard would be as under :

YearPrincipalEnhancedTotal amount (Rs.)Amount (Rs.) Amount (Rs.) 1994 20,00,000/- --- 20,00,000/- 1995 20,00,000/- 1,60,000/- 21,60,000/- 199621,60,000/-1,72,800/-23,32,800/-1997 23,32,800/- 1,86,624/- 25,19,424/- 1998 25,19,424/- 2,01,554/- 27,20,978/- 199927,20,978/-2,17,678/-29,38,656/-2000 29,38,656/- 2,35,092/- 31,73,748/- 2001 31,73,748/- 2,53,900/- 34,27,648/- 200234,27,648/-2,74,212/-37,01,860/- These calculations would show the corresponding value for theyear 2002 at Rs.37,01,860/- per acre. We may call this as Method no.3.

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A

A26. If the figures arrived at through these three methods arecompared, the values of Rs.39,54,666/- per acre[11] under Method no.1,Rs.36.22 lakhs under Method no.2 and Rs.37.01 lakhs under Methodno.3 are quite comparable. If the highest of these three figures is taken,the appropriate value for the lands in Naharpur Kasan and Kasan wouldbe Rs.39,54,666/- per acre[12] in the year 2002.B

27. The values in other three villages namely Bas Kusla, BasHaria and Dhana have not shown any such increase. Apart from Exh.P1,P2 and P3, nothing has been placed on record, insofar as said villagesare concerned. As stated herein above, even for these villages we mayadopt the base rate of Rs.20.00 lakhs for the year 1994 and then considerCthe appropriate increase. As the sale deeds dated Exh. P1, P2 and P3 inrespect of lands coming from these villages have not shown any increaseat all, by way of rough and ready method we may adopt half the rise asshown in the lands coming from villages Naharpur Kasan and Kasan.Half the difference between Rs.20.00 lakhs as the base rate andDRs.39,54,666/- per acre[13] adopted for the villages of Naharpur Kasan,Kasan and Manewsar would mean difference of Rs.9,77,333/-[14 ]overthe base figure of Rs.20.00 lakhs as awarded in Pran Sukh[3. ]Thus, inour considered view, the market value of lands from villages Bas Kusla,Bas Haria and Dhana in 2002 must be at Rs.29,77,333/- per acre[15].

28. In respect of lands coming from village Manesar, the HighECourt had granted 50% rise over and above the market value in respectof villages Naharpur Kasan and Kasan. The increase to that extent waswell justified as the lands in village Manesar are abutting NationalHighway No.8 with excellent commercial potential. The grant of 50%rise is not seriously objected by the State and as such we confirm the Fsame. Thus 50% rise over the figures as applicable to villages NaharpurKasan and Kasan would lead us to the market value in respect of villageManesar which would be Rs.59,31,999/- per acre[16].

29. We, however, find it difficult to accept grant of further 30%as severance charges to M/s. Kohli Holdings Private Limited. Normally G

11 The figure was corrected in terms of Order dated 08.02.2019 in MA No. 299/2019.

12 The figure was corrected in terms of Order dated 08.02.2019 in MA No. 299/2019.

13 The figure was corrected in terms of Order dated 08.02.2019 in MA No. 299/2019.

14 The figure was corrected in terms of Order dated 08.02.2019 in MA No. 299/2019.

15 The figure was corrected in terms of Order dated 08.02.2019 in MA No. 299/2019.

H16 The figure was corrected in terms of Order dated 08.02.2019 in MA No. 299/2019.

the additional component of compensation in terms of Section23(1)(thirdly) of the Act is granted when, a landholder suffers damageas a result of acquisition to the extent that the holding that he is left withstands comparatively diminished in terms of quality and value. Forinstance, if a railway track is to be built through an agricultural land heldby a person, leaving two different halves with him, it would be impossiblefor him to carry on agricultural operations at an optimum level. Thiswould lead to reduction in the value of the halves that he is left with. Onthe other hand, in a case where part of the holding is acquired for whichappropriate commercial value is awarded, the rest of the value of theland will not stand diminished in terms of commercial potential. On theother hand, the potential of the remainder of the land would also increasedrastically as the development would be right in the neighbourhood, thusgiving substantial benefit to the landholder. In our view, the High Courtwas not justified in granting further compensation of 30% to M/s. KohliHoldings Private Limited on account of severance charges. We,therefore, set aside that part and hold that no severance charges needbe awarded to M/s. Kohli Holdings Private Limited.

A

B

C

D

1730. In the circumstances, we direct:

A

B

C

D

1730. In the circumstances, we direct:

a)In respect of lands under acquisition from villages NaharpurKasan and Kasan, the market value shall be Rs.39,54,666/-per acre. Additionally, all statutory benefits would be payable.

E

b)In respect of lands under acquisition from Villages BasKusla, Bas Haria and Dhana, the market value shall beRs.29,77,333/- per acre. Additionally, all statutory benefitswould be payable.

c)In respect of lands from village Manesar the market valueFshall be Rs.59,31,999/- per acre. Additionally, all statutorybenefits would be payable.

d)M/s. Kohli Holdings Private Limited shall not be entitled toany severance charges.

e)If any sum in excess of what has been found in this Judgmentto be the entitlement of any landowner from any of theGvillages under acquisition was made over to him, the sameshall be returned by the landowner to the State by 30[th] June,2019. If the excess sum is returned by 30[th] June, 2019, no

Ainterest on said sum shall be payable by the landowner.However, if the sum is not returned by said date, the saidsum shall carry interest @ 9% per annum from 1[st] July,2019 till realisation and can be realised in a manner knownto law.

B31. The appeals preferred by HSIIDC and the State of Haryanastand allowed to the aforesaid extent. The appeals preferred by all thelandholders including M/s. Kohli Holdings Private Limited standdismissed. No costs. January 11, 2019[18.]

C

Nidhi Jain

Appeals disposed of.

D

E

F

G

18 With modifications as set out in Para 9 of Order dated 08.02.2019 passed inHM.A. No. 299 of 2019 in CA Nos. 264-270 of 2019.