STATE OF ORISSA versus BRIJ LAL MISRA ETC. ETC.

Citation: [1995] SUPP. 2 S.C.R. 354 · Decided: 26-07-1995 · Supreme Court of India · Bench: K. RAMASWAMY, K.S. PARIPOORNAN · Disposal: Appeal(s) allowed

Judgment (excerpt)

A 
STATE OF ORISSA 
v. 
BRIJ LAL MISRA ETC. ETC. 
JULY 26, 1995 
B 
[K. RAMASWAMY AND K.S. PARIPOORNAN, JJ.) 
Land Acquisition Act, 1894:Sections 4( 1 ), 23 & 24. 
Land Acquisition-Compensation-Detemiination of~ompensation 
C 
awarded taking into account the existing potentiality of land-Further enhan-
cement of compensation taking into account future potentiality of Land held 
not pennissible. 
While determining compensation for certain lands acquired the 
Reference Court took into account the existing potentialities of the land 
D and awarded compensation at the rate of Rs. 200 per decimal. It further 
enhanced compensation at 25% for future potentialities which was upheld 
by the High Court. In appeals to this Court on the question whether the 
Courts having determined the compensation by taking into account the 
existing potential value were right in further enhancing the compensation 
E 
F 
G 
at 25% for future potentialities. 
Allowing the appeals in part, this Court 
HELD : 1. Having taken the existing potentialities into consideration 
and determined the compensation at Rs. 200 per decimal, the Reference 
Court as well as the High Court have committed obvious illegality in 
applying wrong principle to award further increase at 25% more for future 
potentialities which is within the grinding teeth of the prohibition 
engrafted in Section 24, fifthly and sixthly, on the Land Acquisition Act, 
1894. [358-C-D] 
V.N. Gajapatiraju v. Revenue Divisional Officer, Vizagaapatnam, AIR 
(1939) P.C. 98; P. Rama Reddy & Ors. v. Land Acquisition Officer, [1995) 
2 SCC 305; Land Acquisition Officer, Eluru and Ors. v. Jasti Rohini and 
Another, [1995] 1 SCC 717, referred to. 
Musamat Kunduna Bibi@Khatun Bibi v. State of Orissa, [1968] 34 
H Orissa Law Times 1043; State of Orissa through the Land Acquisition 
354 
STATE OF ORISSA v: B.L. MISRA 
355 
Collect01; Sundergarh v. Budha Oram & Ors. Etc., (1977) 2 Orissa Weekly A 
Reporter, disapproved. 
2. Section 23(1) of the Act charges determination of the amount of 
compensation for the acquired land taking into account firstly the market 
value of the land at the date of the publication of the notification under 
s.4(1) of the Act. The market value prevailing on the date of the notification 
including potentiality the land possessed of as on the date of the notifica-
tion would be the relevant fact for consideration to determine market 
value. The very concept of the potential value would mean existing in 
possibility but not in act, i.e., the land is capable to be used in future in 
B 
the existing condition. Section 24, fifthly, of the Act expressly prohibits C 
taking into account such future use declaring such matters to be neglected 
in determining compensation. The Court shall not take into consideration 
any increase to the value of the land acquired likely to accrue from the use 
to which it will be put when acquired; sixthly, any increase to the value of 
the other land of the person interested likely to accrue from the use to 
which the land acquired will be put. [356-E; G-H, 357-A-B] 
D 
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 704-706 
of 1980. 
From the Judgment and Order dated 1.8.78 of the Orissa High Court 
in F.A.No. 113, 114 and 115 of 1970. 
R.K. Mehta for the Appellant. 
B.D. Sharma for the Respondent. 
The following Order of the Court was delivered: 
These three appeals are disposed of by a common judgment since 
the questions of law raised are common. 
E 
F 
A notification under s.4(1) of the Land Acquisition Act(for short, 
'the Act') was published in 1968 acquiring 0.62 acre, 0.82 acre and 0.15 G 
acre in Survey Nos. 704, 705 and 706/80 respectively for construction of 
over-bridge, near Vedavyas in Rajganjpur - Rourkela Road. The Land 
Acquisition Officer determined the compensation under s.11 of the Act 
between Rs. 1360 per acre to Rs. 2912 per acre. On reference, the Subor-
dinate Judge, by award and decree dated January 19, 1970, while deter-
H 
. 356 
SUPREME COURT REPORTS (1995] SUPP. 2 S.C.R. 
A 
mining the compensation at the rate of Rs. 200 per decimal, on the basis 
of comparable sales which ranged between Rs. 100 to Rs. 115 per decimal, 
further enhanced 25% of the compensation for future potential value which 
was upheld by the High Court by its impugned judgment dated August 16, 
1978. The only question, rightly canvassed by Shri Mehta, learned counsel 
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D 
E 
F 
for the appellant is whether the courts having determined the compe

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