Case NameJaw Ajee Nagnatham vs Revenue Divisional Officer
Citation1994 SCC (4) 595
CourtSupreme Court of India
Author of the judgmentJustice K. RAMASWAMY
Date of the judgment25 January, 1994
Relevant Act/SectionsLand Acquisition Act, 1984- Section 23, Section 24
Author of the casebriefAditya Gor

Brief Facts and Procedural History-

The appellant is the owner of 18 gunthas of land, situated in Adilabad Municipality of A.P., which was proposed for acquisition under a notification issued under Section (1) of the Land Acquisition Act and published for a public purpose. The Land Acquisition officer awarded compensation on the basis of letting value. On a reference under Section 18, the Additional District Judge, Adilabad in his award and decree enhanced the market value to Rs 75 per sq. yard.

Not having been satisfied, the appellant filed the appeal in the High Court and claimed Rs 300 per sq. yard. The High Court by the impugned judgment and decree dated 29-10-821, dismissed the appeal.

The High Court found that the basic valuation register has no evidentiary value and in that it had no statutory basis. The High Court held that the post- notification sale deeds were not admissible as none of the persons connected with them were examined to establish the genuineness of the sales.

Grounds of appeal raised by the appellants-

  1. The land in question has a very high market value and the Basic Valuation Register showed that for stamp duty the Revenue Authorities had fixed the market value in the commercial area at Rs 300.

  2. Since the Revenue Authorities have themselves determined the market value in that area at Rs 300 per sq. yard for purposes of stamp duty, the Basic Valuation Register formed a foundation to determine the market value of the acquired land at Rs 300 and the fixation of market value at Rs 75 per sq. yard was unjust and arbitrary.

  3. The appellant is entitled to interest at 6% under the Act. The State Act has no application to and the owner cannot be discriminated in payment only at the rate of 4%, while other land acquired for Central Government would get interested at the rate of 6%.

The issue before the court-

1) Whether the land in question is entitled to the market value of Rs 300 per sq. yards? – No

2) Whether the Basic Valuation Register is evidence to determine the market value? – No

3) Whether the Basic Valuation Register would form a foundation to determine the market value? – No

Ratio if the Court-

The contention that the lands are to be treated as of commercial area cannot be accepted to be totally correct. Admittedly, the appellant had not prepared nor got approved any lay-out demarcating as sites either for commercial purpose or for residential purpose. The entire extent of land cannot be treated as capable of being sold only for commercial purpose.

The methods of valuation may be (1) opinion of experts (2) the price paid within a reasonable time in bona fide transactions of purchase of the lands acquired or the lands adjacent to the lands acquired and possessing similar advantages; and (3) a number of years purchase of the actual or immediately prospective profits of the lands acquired.

Therefore, it is settled law that in determining the market value, the Court has to take into account either one or the other three methods to determine the market value of the lands appropriates on the facts of a given case to determine the market value. Generally, the second method of valuation is accepted as the best.

The Basic Valuation Register prepared and maintained for the purpose of collecting stamp duty has no statutory base or force. It cannot form a foundation to determine the market value mentioned thereunder in instrument brought for registration. Equally, it would not be a basis to determine the market value under Section 23 of the Act, of the lands acquired in that area or town or the locality or the taluka etc. Evidence of bona fide sales between willing prudent vendor and prudent vendee of the lands acquired or situated near about that land possessing same or similar advantageous features would furnish a basis to determine market value.

The burden of proof is always on the claimant to prove, in each case the prevailing market value as on the date of notification published in the State Gazette under Section 4(1) of the Act with reference to the sale deeds of the same lands or neighbour’s lands possessed of same or similar advantages and features executed between willing vendor and willing vendee or other relevant evidence in the reference court.

Decision Held-

The submissions made are without any merit. The appeal was dismissed.