LexSANGUNTHALA (DEAD) THR. LRS. versus SPECIAL TEHSILDAR (L.A.) & ORS.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A 8 [2010] 3 S.C.R. 50 SANGUNTHALA (DEAD) THR. LRS. v. SPECIAL TEHSILDAR (L.A.) & ORS. (Civil Appeal Nos. 6240-6243 of 2001 etc.) FEBRUARY 24, 2010 [G.S. SINGHVI AND ASOK KUMAR GANGULY, JJ.] Land Acquisition Act, 1894 - s. 23 - Acquired land ::... Classification - Market value - Determination of - The lands C were acquired for construction of houses - They were potential house sites - Even at the time of acquisition, there were buildings on the lands - Compensation determined by Land Acquisition Officer - Enhanced by reference court, classifying the land as house sites - High Court holding the o land as agricultural land - Held: The market value of a property has to be determined having due regard to its existing condition with all its existing advantages and its potential possibility - The market value of the acquired lands were rightly determined by reference court, classifying the E same as house sites. Words and Phrases: 'Market value' - Meaning of, in the context of s. 23 of Land Acquisition Act, 1894. The land in question was acquired under Land F Acquisition Act, 1894. Compensation amount thereof was determined by Land Acquisition Officer. The same was enhanced by reference court classifying the lands as house sites. High Co_urt set aside the order of reference court and determined the market value of the lands as G agricultural lands , holding that the lands on the date of acquisition were agricultural lands. Hence, the present appeals. Allowing the appeals, the Court H 50 SANGUNTHALA (DEAD) THR. LRS. v. SPECIAL 51 TEHSILDAR (L.A.) HELD: 1.1. The burden of establishing/proving the A market value of the lands is always on the claimants. The court has to treat the reference as an original proceeding before it, for determination of the market value afresh on the basis of the material produced before it. The claimant in the position of a plaintiff has to show that the price B offered for his land in the award is inadequate on the basis of the materials produced in court. The material produced and proved by the other side will also be taken into account for this purpose. [Para 29] [65-A-B] Periyar and Pareekanni Rubbers Ltd. v. State of Kera/a C AIR 1990 SC 2192; Special Deputy Collector and Anr. v. Kurra Sambasiva Rao and Ors. (1997) 6 SCC 41; Ki ran Tandon v. Allahabad Development Authority and Anr. (2004) 10 sec 745, relied on. 1.2. The 'market value' is the price that a willing purchaser would pay to a willing seller for the property having due regard to its existing condition with all its existing advantages and its potential possibilities when D let out in most advantageous manner excluding any E advantage due to carrying out of the scheme for which the property is compulsorily acquired. In considering market value, disinclination of the vendor to part with his land and the urgent necessity of the purchaser to buy should be disregarded. The guiding principle would be F the conduct of hypothetical willing vendor who would offer the land and that of a purchaser who, in normal human conduct, would be willing to buy as a prudent man in normal market conditions but not of an anxious purchaser dealing at arm's length nor a fictitious sale G brought about in quick succession or otherwise to inflate the market value. The determination of market value is the prediction of an economic event viz. a price outcome of hypothetical sale expressed in terms of probabilities. [Para 34] [66-G-H; 67-A-C] H I 52 SUPREME COURT REPORTS [2010] 3 S.C.R. A 1.3. The market value of a property has to be determined having due regard to its existing condition with all its existing advantages and its potential possibility when let out in its most advantageous manner. The question whether a land has potential value or not, B is primarily one of facts depending upon its condition, situation, user to which it is put and whether it is reasonably capable of being put and proximity to residential, commercial or industrial areas or institutions. The existing amenities like water, electricity, possibility of c their further extension, whether near about town is developing or has prospect of development have to be taken into consideration. [Para 35] [67-D-E] 1.4. The reference court was right in holding that while determining the value of the property acquired one D has to see whether the land has got the building potentiality to be used for the buil
Excerpt shown. Read the full judgment & AI analysis in Lexace.