High Court of Bombay at Goa Partly Allows Appeal by Land Acquisition Officer in Konkan Railway Acquisition — Compensation Reduced from Rs.24 to Rs.19.20 per sq m Due to Deduction for Development Charges. The Court held that the reference Court erred in not deducting development charges from the market value determined on the basis of a comparable sale instance for a large chunk of paddy field acquired for railway purposes.

Appeal against enhancement of compensation in land acquisition reference

Appellants sought reduction of compensation awarded by the reference Court

Appellants challenged the judgment and award dated 12.8.1999 passed by the Additional District Judge, South Goa, Margao in Land Acquisition No.141/95 enhancing compensation from Rs.9/- to Rs.24/- per sq m

Special Land Acquisition Officer awarded Rs.9/- per sq m on 9.12.1993; reference Court enhanced to Rs.24/- per sq m on 12.8.1999

Whether the reference Court was justified in relying on the earlier award dated 15.3.1989 (Exhibit AW1/B) for determining market value of the acquired land? Whether the reference Court erred in not making any deduction for development charges from the market value determined on the basis of the earlier award? Whether the compensation awarded by the reference Court is excessive and requires reduction?

Appellants argued that the earlier award (Exhibit AW1/B) was not comparable as it was for acquisition for an approach road, not for railway, and the land was small in extent; the reference Court failed to consider the large size of the acquired land (8000 sq m) and the need for deduction for development; the compensation of Rs.24/- per sq m was excessive. Respondents argued that the earlier award was for similar paddy field land in the same village and was a relevant piece of evidence; the reference Court correctly applied it and no deduction was necessary as the land had potential for building purposes.

In determining market value of acquired land under the Land Acquisition Act, an earlier award for acquisition of similar land in the same vicinity can be relied upon as a comparable instance. However, when the acquired land is a large chunk requiring development for building purposes, a deduction for development charges (typically 20%) must be made from the market value derived from such comparable instance. The time gap between the earlier award and the Section 4 notification may be considered but does not automatically warrant escalation if already accounted for.

The reference Court relying upon the Award dated 15th March, 1989 (Exhibit AW1/B) which was in respect of acquisition for the proposed approach road to Talpona Galjibag bridge awarded Rs.24/- per square metre in respect of acquired land after holding that the land belonging to the respondent is similar to the land which was the subject matter of the said award. In my opinion, the reference Court was justified in relying upon the said award for determining the market value of the acquired land. However, the reference Court has not made any deduction towards development charges. The acquired land is a large chunk of paddy field. In order to make the land suitable for building purposes, development is necessary. Therefore, a deduction of 20% towards development charges is warranted. Accordingly, the compensation is reduced from Rs.24/- to Rs.19.20 per square metre.

Notification under Section 4 of the Land Acquisition Act issued on 24.7.1991 for acquisition of land for Konkan Railway. Special Land Acquisition Officer passed award on 9.12.1993 awarding Rs.9/- per sq m. Original applicant sought reference under Section 18. Reference Court (Additional District Judge, South Goa, Margao) passed judgment and award on 12.8.1999 in Land Acquisition No.141/95 enhancing compensation to Rs.24/- per sq m. Appellants filed First Appeal No.153 of 2000 in the High Court of Bombay at Goa. High Court partly allowed the appeal on 4.5.2005, reducing compensation to Rs.19.20 per sq m.

• Land Acquisition Act, 1894: Section 4, Section 18