# Kailash Nath Gupta v. The Collector, Varanasi

- **Citation:** (2020) 2 ILRA 1353
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2019-02-26
- **Case number:** First Appeal No. 591 of 2009
- **Bench:** Surya Prakash Kesarwani
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/kailash-nath-gupta-v-the-collector-varanasi-45178
- **Pages:** 5

## Headnote

A. Civil Law- Land Acquisition Act (1 of 1894)
- S.18 - Acquisition - Reference - Reference is
not appeal - Material relied on by Acquisition
Officer in award - cannot be relied upon by
the reference court unless same material is
produced and proved before reference court

Held - There was no justification for the reference
court to determine the market value of the acquired
land on the basis of a sale deed which was neither
filed in evidence nor it was before it but was merely
referred in the award passed by the S.L.A.O. (Para
9)

B. Land Acquisition Act - Deduction - 40% -
on account of largeness of area

Held - As per sale deed exemplars filed in evidence,
smaller area measuring 10 dhoors was sold while
total land measuring 1.492 acres, i.e. 2 bighas 7
biswas and 16 dhoors was acquired and therefore a
deduction on account largeness of area made -
Court applied deduction of 40% for the largeness of
the area (Para 10)

First Appeal partly allowed (E-5)

List of case cited :
Chimanlal Hargovinddas vs. Special Land Acquisition
Officer (1988) 3 SCC 751

## Text

2 All. Kailash Nath Gupta Vs. The Collector, Varanasi
1353
(2020)02ILR A1353

APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 26.02.2019

BEFORE

THE HON'BLE SURYA PRAKASH
KESARWANI, J.

First Appeal No. 591 of 2009

Kailash Nath Gupta ...Appellant
Versus
The Collector, Varanasi ...Respondent

Counsel for the Appellant:
Sri S.K. Singh, Sri R.C. Maurya

Counsel for the Respondent:
Standing Counsel

A. Civil Law- Land Acquisition Act (1 of 1894)
- S.18 - Acquisition - Reference - Reference is
not appeal - Material relied on by Acquisition
Officer in award - cannot be relied upon by
the reference court unless same material is
produced and proved before reference court

Held - There was no justification for the reference
court to determine the market value of the acquired
land on the basis of a sale deed which was neither
filed in evidence nor it was before it but was merely
referred in the award passed by the S.L.A.O. (Para
9)

B. Land Acquisition Act - Deduction - 40% -
on account of largeness of area

Held - As per sale deed exemplars filed in evidence,
smaller area measuring 10 dhoors was sold while
total land measuring 1.492 acres, i.e. 2 bighas 7
biswas and 16 dhoors was acquired and therefore a
deduction on account largeness of area made -
Court applied deduction of 40% for the largeness of
the area (Para 10)

First Appeal partly allowed (E-5)

List of case cited :
Chimanlal Hargovinddas vs. Special Land Acquisition
Officer (1988) 3 SCC 751

(Delivered by Hon'ble Surya Prakash
Kesarwani, J.)

1. Heard Sri R.C. Maurya, learned
counsel for the claimant-appellant and Sri B.K.
Yadav, learned standing counsel for the Staterespondents.

2. This first appeal has been filed for
enhancement of compensation.

3. Briefly stated facts of the present case
are that by notification under Section 4(1) of
the Land Acquisition Act, 1894 published in
the U.P. Gazette on 17.04.1982, an area of
1.492 acres land of certain khasra plots
including plot Nos.75 and 77 measuring 16
biswas in village Rajpura, Pargana Bhadohi,
Tehsil Gyanpur, District Varanasi belonging to
the claimant-Appellant, which was acquired
for construction of a building for telephone
exchange. Notification under Section 6 of the
Act was published in the Gazette on
17.04.1982. Possession was transferred on
18.01.1983. The Special Land Acquisition
Officer made the award on 13.03.1984
awarding compensation @ Rs.6428.50 per
biswa.

4. As per the impugned judgment of the
reference court, the boundaries of the
acquired khasra plot Nos.75 and 77 of the
claimant-appellant, are undisputedly as
under:

"East: Bhadohi Gyanpur Road

West: Cold Storage of Ram
Sundar Ram Nath

North: House of Daya Yadav in
which business of caustic soda is carried
on

South: Residential Houses"
1354 INDIAN LAW REPORTS ALLAHABAD SERIES

5. The S.L.A.O. and the court below
found that Bhadohi Railway Station
(Railway Crossing) is situate at a distance
of one furlong from the acquired land of
the claimant-appellant, the acquired land is
within the municipal limits of Nagarpalika
Bhadohi, means of transportation are
available and near the acquired land there
are residential houses and businesses
establishments and the area is regularly
developing. The S.L.A.O. selected a sale
deed at Serial No.46 of his chart as
exemplar to determine the compensation.

6. I have looked into the records of
the court below and I find that as per chart
prepared by the S.L.A.O. the aforesaid sale
deed at Serial No.46 is dated 07.04.1981
with respect to khasra plot No.73,
measuring 10.5 dhoor disclosing selling
rate of Rs.8571.43 per biswa. Perusal of
the map of the village filed in evidence
and available in the records of the court
below shows that plot No.73 (subject
matter of the selected sale deed exemplar)
is not adjoining the road but between it
and the road, there is plot No.72 whereas
the plots of the claimant-appellant are
adjoining the road.

7. Before the reference court, the
respondents have not led any evidence
with regard to the market value of the
acquired land of the claimant-appellant.
The
claimant-appellant
has
filed
in
evidence two sale deed exemplars namely
sale
deed
dated
22.01.1982
(paper
No.22ga) whereby one Devi Prasad has
sold 10 biswas land of his khasra plot
No.123 for Rs.10,000/- and the sale deed
dated
02.01.1982
(paper
No.23ga)
whereby one Devi Prasad has sold 10
biswas land of his khasra plot No.123 for
Rs.10,000/-. These sale deeds indicate
selling rate of nearby road side land of
khasra plot No.123 to be Rs.20000/- per
bigha. As per map of the village available
in the records of the court below, khasra
plot No.123 is adjoining the road and is
near to the acquired land of the claimantappellant. These sale deeds were executed
about one year before the acquisition. It is
not the case of the respondents that these
sale deeds are not genuine or motivated.
Therefore, there was no justification for
the reference court to reject these two
evidences and instead to rely upon the
observation of the S.L.A.O. made in the
award.

8. In Chiman Lal Hargovinddas v.
Special Land Acquisition Officer, Poona
and another, (1988)3 SCC 751 (para-4),
Hon'ble Supreme Court laid down the law
for determination of market value in
acquisition, as under:

"4. The following factors must be
etched on the mental screen:

(1) A reference under section 18
of the Land Acquisition Act is not an
appeal against the award and the Court
cannot take into account the material
relied upon by the Land Acquisition
officer in his Award unless the same
material is produced and proved before
the Court.

(2) So also the Award of the
Land Acquisition officer is not to be
treated as a judgment of the trial Court
open or exposed to challenge before the
Court hearing the Reference. It is merely
an offer made by the Land Acquisition
officer and the material utilised by him
for making his valuation cannot be
utilised by the Court unless produced and
proved before it. It is not the function of
the Court to sit in appeal against the
Award,approve
or
disapprove
its
reasoning, or correct its error or affirm,
2 All. Kailash Nath Gupta Vs. The Collector, Varanasi
1355
modify or reverse the conclusion reached
by the Land Acquisition officer, as if it
were an appellate court.

(3) The Court has to treat the
reference as an original proceeding
before it and determine the market value
afresh on the basis of the material
produced before it.

(4) The claimant is in the
position of a plaintiff who has to show
that the price offered for his land in the
award is inadequate on the basis of the
materials produced in the Court. Of
course the materials placed and proved by
the other side can also be taken into
account for this purpose.

(5) The market value of land
under acquisition has to be determined as
on the crucial date of publication of the
notification under Section 4 of the Land
Acquisition Act (dates of Notifications
under sections 6 and 9 are irrelevant).

(6) The determination has to be
made standing on the date line of
valuation
(date
of
publication
of
notification under Section 4) as if the
valuer is a hypothetical purchaser willing
to purchase land from the open market
and is prepared to pay a reasonable price
as on that day. It has also to be assumed
that the vendor is willing to sell the land
at a reasonable price.

(7) In doing so by the instances
method, the Court has to correlate the
market value reflected in the most
comparable instance which provides the
index of market value.

(8) Only genuine instances have
to be taken into account. (Some times
instances are rigged up in anticipation of
Acquisition of land).

(9)
Even
post
notification
instances can be taken into account (1) if
they are very proximate,(2) genuine and
(3)
the
acquisition
itself
has
not
motivated the purchaser to pay a higher
price on account of the resultant
improvement in development prospects.

(l0)
The
most
comparable
instances out of the genuine instances
have to be identified on the following
considerations:

(i) proximity from time angle,

(ii) proximity from situation
angle.

(11)
Having
identified
the
instances which provide the index of
market value the price reflected therein
may be taken as the norm and the market
value of the land under acquisition may
be
deduced
by
making
suitable
adjustments for the plus and minus
factors vis-a-vis land under acquisition by
placing the two in juxtaposition.

(12) A balance-sheet of plus and
minus factors may be drawn for this
purpose and the relevant factors may be
evaluated in terms of price variation as a
prudent purchaser would do.

(13) The market value of the
land under acquisition has there after to
be deduced by loading the price reflected
in the instance taken as norm for plus
factors and unloading it for minus
factors.

(14) The exercise indicated in
clauses (11) to (13) has to be undertaken
in a common sense manner as a prudent
man of the world of business would do.
We may illustrate some such illustrative
(not exhaustive) factors:

Plus factors

Minus
factors

1. smallness of size
1. largeness
of area

2. proximity to a road

2.
situation in the interior at a distance from
the Road

3. frontage on a road

3.
Narrow strip of land with
1356 INDIAN LAW REPORTS ALLAHABAD SERIES

very small frontage compared to
depth

4. nearness to developed area

4. lower level requiring the depressed
portion to be filled up 5. regular shape 5.
remoteness from developed locality

6.
level
vis-a-vis
land
under
acquisition
6.
some
special
disadvantageous factor which would deter
a purchaser

7. special value for an owner of an
adjoining property to whom it may have
some very special advantage

(15) The evaluation of these
factors of course depends on the facts of
each case. There cannot be any hard and
fast or rigid rule. Common sense is the
best and most reliable guide. For instance,
take the factor regarding the size. A
building plot of land say 500 to 1000 sq.
yds cannot be compared with a large tract
or block of land of say l0000 sq. yds or
more. Firstly while a smaller plot is
within the reach of many, a large block of
land will have to be developed by
preparing a lay out, carving out roads,
leaving open space, plotting out smaller
plots, waiting for purchasers (meanwhile
the invested money will be blocked up)
and the hazards of an entrepreneur. The
factor can be discounted by making a
deduction by way of an allowance at an
appropriate rate ranging approximately
between 20 percent to 50 percent to
account for land required to be set apart
for carving out lands and plotting out
small plots. The discounting will to some
extent also depend on whether it is a rural
area or urban area, whether building
activity is picking up, and whether waiting
period during which the capital of the
entrepreneur would be looked up, will be
longer or shorter and the attendant
hazards.

(16) Every case must be dealt
with on its own fact pattern bearing in
mind all these factors as a prudent
purchaser of land in which position the
Judge must place himself.

(17)
These
are
general
guidelines
to
be
applied
with
understanding informed with common
sense."(Emphasis supplied by me)

9. In view of the law laid down by
Hon'ble Supreme Court in the case of
Chiman Lal Hargovinddas (supra), it
is clear that a reference under Section
18 of the Act is not an appeal against
the award and the court cannot take
into account the material relied upon
by the Land Acquisition Officer in his
award unless the same material is
produced and proved before the court.
Undisputedly, the sale deed relied by
the S.L.A.O. was not produced or
provided by the respondents before the
reference
court
in
the
reference.
Likewise, the sale deeds exemplars as
collected by the S.L.A.O. were not
filed in evidence before the court
below by the respondents. Learned
standing counsel could not point out
from the paper book or from the
records of the lower court that any sale
deed exemplar in evidence was filed by
the respondents. Therefore, there was
no justification for the reference court
to determine the market value of the
acquired land on the basis of a sale
deed which was neither filed in
evidence nor it was before it but was
merely referred in the award passed by
the S.L.A.O. On the contrary, the sale
deed exemplars being paper Nos.22ga
and 23ga, were filed in evidence by the
claimant-appellant to establish that
nearby similar road side land situate on
2 All. Mohammad Alim & Ors. Vs. Tahir Hussain
1357
the Bhadohi-Gyanpur road was sold @
Rs.20,000/- per biswa.

10. Under the circumstances, I am of the
considered view that the sale deed exemplars
being paper Nos.22ga and 23ga can be made
basis to determine market value of the acquired
land of the claimant-appellant as on the date of
acquisition, i.e. 17.04.1982. Since as per the
sale deed exemplars filed in evidence, smaller
area measuring 10 dhoors was sold @
Rs.20,000/- per biswa while total land
measuring 1.492 acres, i.e. 2 bighas 7 biswas
and 16 dhoors was acquired and therefore a
deduction on account largeness of area
deserves to be made.

11. Considering the facts and evidences
on record and after applying deduction of 40%
for the largeness of the area, the market value
of the acquired land of the claimant-appellant
is determined @ Rs.12,000/- per biswa. The
claimant-appellant shall be entitled to all other
statutory benefits as per the impugned
judgment of the reference court dated
23.02.1985 in L.A.R. No.113 of 1984 (Kailash
Nath Gupta vs. Collector, Varanasi). The
impugned judgment and decree is accordingly
modified.

12. The appeal is partly allowed to the
extent indicated above.
----------
(2020)02ILR A1357

APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 06.01.2020

BEFORE
THE HON'BLE SUDHIR AGARWAL, J.

Second Appeal No. 1798 of 1978

Mohammad Alim & Ors. ...Appellants
Versus
Tahir Husain ...Respondent
Counsel for the Appellants:
Sri R. Asthana, Sri Gulrez Khan, Sri H.S.
Ahmad, Sri Haji Iqbal Ahmad, Sri Javed
Husain Khan, Sri Ramendra Asthana, Sri
W.H. Khan

Counsel for the Respondent:
Sri R.K. Jain, Sri R.G. Prasad

A. Muslim Law - Transfer of property -
Right of 'Pre-emption' - also called
right of 'Shufaa' - Right of preemption to co-sharers - is valid and
not violative of Articles 14, 15 and 16
of Constitution - Held - Plaintiff was a
co-sharer with defendant-3 in respect
of property in dispute - to this extent
right of pre-emption of plaintiff is
valid (Para 28, 29)

B. Muslim Law - Transfer of property -
Pre-emption - Exercise of right of preemption - Right of pre-emption has to
be exercised only when transfer of
property/sale is complete and not
before
thereto
-
till
transfer
is
completed, there is no occasion to
exercise right of pre-emption - Waiver
of right of pre-emption - Onus - When
a plea is raised by defendant that
right of pre-emption has been waived,
onus lie upon defendant to prove

Held - Defence by defendants that offer
was made to plaintiff before execution of
sale deed and since he did not agree, it
amounts to waiver of his right of preemption - Held - it cannot be said that
plaintiff did not exercise his right of preemption and waived such right before
execution of sale deed since till transfer is
completed, there is no occasion to exercise
right of preemption. (Para 34, 38)

Second Appeal dismissed. (E-5)

List of cases cited :

1. Bhanu Ram Vs B. Baijnath Singh AIR 1961
SC 1327;

2. Sant Ram Vs Labh Singh AIR 1965 SC 314