Property Lawyer: Sale deed of small area, having claimant as one of the party, cannot be relied upon, while determining market rate in Land Acquisition proceedings by Reference Court; SC.

Supreme Court of India

Justice Abhay Manohar Sapre and Justice R. Subhash Reddy

The SC { State of Himachal Pradesh & Ors. v. Kanshi Ram & Ors.} holds that the Sale Deed of one biswa land cannot be considered for calculating market value of 18 bighas of land. It was held that under the sale deed Ex.PW-1/A only one biswa of land was sold by PW-2 Garja Ram to PW-3 Kuldip, for a consideration of Rs.50,000/-. It was further held that it is not in dispute that PW-2 Garja Ram is also a claimant in the land acquisition proceedings. It was held that when the total land admeasuring 18-15 bighas of land was acquired, the Reference Court and the High Court committed error in accepting document in Ex.PW-1/A, as a comparable sale for the purpose of fixing the market value of the acquired land at the rate of Rs.7.00 lakhs per bigha.

It was further held that as no other documentary evidence is available on record and further in view of the allegation of the appellants that the sale deed in Ex.’RA’ dated 04.05.2001 under which 4-51 bighas of land in adjoining village was sold in the year 2001, is not considered without assigning valid reasons, in view of that these appeals filed by the State are to be allowed by remitting the matter for fresh consideration by the Reference/District Court. It was also held as much as PW-2 is the vendor under Ex.PW-1/A, who is no other than one of the claimants in the land acquisition proceedings, such sale could not have been considered as a comparable sale for the purpose of fixing the market value of large extent of land i.e. 18-15 bighas. Further, held that the Reference Court has committed error in relying on such document for fixing the compensation at the rate of Rs.7.00 lakhs per bigha. If no other comparable sales are available in the same village it is always open to the Reference Court to consider sales in the adjoining villages during the relevant period. Even otherwise there are other methods for fixing the compensation. The SC held such erroneous fixation of market value at the rate of Rs.7.00 lakhs per bigha as fixed by the Reference Court, ought not to have been approved by the High Court. Accordingly, the judgments of High Court and lower Court were set aside, and the matter was sent to the District Court for fresh consideration.

In the said case, initially the rate of Rs.61,666.00 /- was fixed, which was enhanced by the Reference Court to Rs. 7 Lakhs on the basis of aforesaid Sale Deed, which was of much lower area, and pertaining to one of the claimant as a party to the said Sale Deed. The High Court failed to interfere with the said perverse enhancement. The SC sets aside both the judgments.