Gujarat High Court Allows State's Appeal in Land Acquisition Case — Reduces Compensation from Rs.49 to Rs.39.71 per sq. mtr. for Jirayat Land. Court holds that Reference Court erred in granting 10% price escalation without proper basis under Section 23 of Land Acquisition Act, 1894.

High Court: Gujarat High Court In Favour of Prosecution
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Case Note & Summary

The case involves three First Appeals filed by the State of Gujarat (Deputy Collector and another) under Section 54 of the Land Acquisition Act, 1894 read with Section 96 of the Code of Civil Procedure, 1908, challenging a common judgment and award dated 01.10.2004 passed by the learned Additional Senior Civil Judge, Rajula District - Amreli in Land Reference Case No.100 of 2017. The Reference Court had determined the market value of acquired Jirayat land in Village Khakhbhai, Taluka Rajula, District Amreli at Rs.49 per sq. mtr. The land was acquired for the Dhatarwadi-2 Irrigation Project, with notifications under Section 4 dated 08.07.1999 and Section 6 dated 16.08.1999, and an award under Section 11 passed by the Special Land Acquisition Officer. The State, through learned AGP Mr. Parth Patel, submitted that the appeals were filed with a limited prayer: that the Reference Court erred in awarding Rs.49 per sq. mtr. instead of Rs.39.71 per sq. mtr. by granting a 10% price escalation without proper basis. The State did not challenge any other aspect of the award. The learned advocate for the respondents, Mr. N. V. Gandhi, was unable to dispute the State's submission and requested an appropriate order. The High Court, after considering the submissions and reviewing the reasons, found merit in the State's limited challenge. It noted that the Reference Court had incorrectly applied a 10% price escalation without justification. Consequently, the High Court allowed the appeals and modified the impugned judgment and award, reducing the market value from Rs.49 to Rs.39.71 per sq. mtr. The Court directed that the original claimants would be entitled to the modified compensation along with all other statutory benefits as per the Land Acquisition Act, 1894. The connected civil applications for stay were disposed of as having become infructuous.

Headnote

A) Land Acquisition - Market Value Determination - Price Escalation - Section 23, Land Acquisition Act, 1894 - The State challenged the award of Rs.49 per sq. mtr. as excessive, arguing that the Reference Court erroneously applied a 10% price escalation without proper basis. The High Court found merit in the State's limited challenge and reduced the market value to Rs.39.71 per sq. mtr., modifying the impugned award. (Paras 1-6)

B) Land Acquisition - Limited Challenge - State's Appeal - Section 54, Land Acquisition Act, 1894 read with Section 96 CPC - The State confined its appeal to the quantum of compensation, specifically the price escalation aspect. The High Court allowed the appeal with the limited modification, reducing the rate from Rs.49 to Rs.39.71 per sq. mtr. (Paras 3-6)

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Issue of Consideration

Whether the Reference Court correctly determined the market value of acquired land at Rs.49 per sq. mtr. instead of Rs.39.71 per sq. mtr. by applying 10% price escalation without proper justification.

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Final Decision

The High Court allowed the appeals and modified the impugned judgment and award dated 01.10.2004 passed by the learned Additional Senior Civil Judge, Rajula District - Amreli in Land Reference Case No.100 of 2017. The market value of the acquired Jirayat land was reduced from Rs.49 to Rs.39.71 per sq. mtr. The original claimants were held entitled to the modified compensation along with all other statutory benefits as per the Land Acquisition Act, 1894. The connected civil applications for stay were disposed of as having become infructuous.

Law Points

  • Market value determination
  • Price escalation
  • Section 23 Land Acquisition Act
  • 1894
  • Section 54 Land Acquisition Act
  • Section 96 CPC
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Case Details

2026 LawText (GUJ) (02) 1236

R/First Appeal No. 666 of 2026 with R/First Appeal No. 667 of 2026 with R/First Appeal No. 668 of 2026

2026-02-24

M. K. Thakker

2026:GUJHC:15751

Parth Patel, Himani Shah, Bhavesh Desai (AGP for appellants), N.V. Gandhi (for respondents)

The Deputy Collector & Anr.

LH of Babubhai Devsibhai Ladumore & Ors.

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Nature of Litigation

First Appeals under Section 54 of the Land Acquisition Act, 1894 read with Section 96 of CPC challenging the quantum of compensation awarded by the Reference Court.

Remedy Sought

The State (appellant) sought modification of the impugned judgment and award to reduce the market value from Rs.49 to Rs.39.71 per sq. mtr.

Filing Reason

The State contended that the Reference Court erroneously granted a 10% price escalation without proper basis, resulting in an excessive compensation of Rs.49 per sq. mtr.

Previous Decisions

The Reference Court (Additional Senior Civil Judge, Rajula) passed judgment and award dated 01.10.2004 in Land Reference Case No.100 of 2017, determining market value at Rs.49 per sq. mtr. for Jirayat land.

Issues

Whether the Reference Court correctly applied a 10% price escalation to determine the market value at Rs.49 per sq. mtr. instead of Rs.39.71 per sq. mtr.

Submissions/Arguments

Learned AGP Mr. Parth Patel submitted that the State's appeal was limited to the quantum of compensation, specifically the price escalation aspect, and prayed for reduction to Rs.39.71 per sq. mtr. Learned advocate Mr. N.V. Gandhi for the respondents was unable to dispute the State's submission and requested an appropriate order.

Ratio Decidendi

The Reference Court erred in granting a 10% price escalation without proper justification, leading to an excessive market value determination. The State's limited challenge to the quantum of compensation was upheld, and the market value was reduced to Rs.39.71 per sq. mtr. as per the correct calculation.

Judgment Excerpts

It is submitted by the learned AGP Mr. Patel that these appeals are filed with a limited prayer that instead, after giving the price escalation at the rate of Rs.10% by giving the effect of the notification of one year prior, the learned Court has awarded the market value at the rate of Rs.49/- instead of Rs.39.71/- per sq. mtr. Having considered the submissions made by the learned advocates for the parties and on referring to the reasons, it emerges that the land under the acquisition is pertaining to Village - Khakhbhai, Taluka - Rajula, District - Amreli and the same was acquired for the project of Dhatarwadi-2 Irrigation Project...

Procedural History

The Special Land Acquisition Officer passed an award under Section 11 of the Land Acquisition Act, 1894. Dissatisfied, the claimants sought reference under Section 18, leading to Land Reference Case No.100 of 2017. The Reference Court (Additional Senior Civil Judge, Rajula) passed judgment and award dated 01.10.2004, determining market value at Rs.49 per sq. mtr. The State filed three First Appeals (Nos. 666, 667, 668 of 2026) under Section 54 of the Act read with Section 96 CPC, challenging the quantum. The High Court heard the appeals and delivered a common judgment on 24.02.2026.

Acts & Sections

  • Land Acquisition Act, 1894: Section 4, Section 6, Section 11, Section 23, Section 54
  • Code of Civil Procedure, 1908: Section 96
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