PLJ 2022 Lahore 754 (DB)
Land Acquisition Act, 1894 (I of 1894)--
----Ss. 18, 34 & 154--Acquisition of land--Assessment of price--Award was announced--Filing of reference--Dismissed--Reference was dismissed after post remand proceedings--Delay in completing acquisition proceedings--Opportunity to raising objections--Non-producing of evidence by respondents regarding fixation of average price--Officials of price assessment committee were not produced in evidence--Prima facie--Findings of referee Judge were not challenged by respondents--Challenge to--Respondents took five years and three months to complete acquisition proceedings--The price may have escalated during this period and this escalation has to be kept in view while assessing potential value of land--Respondents did not produce any evidence to prove average price fixed by revenue staff and awarded to appellants whereas appellants produced voluminous evidence on support of their claim--None of officials of Price Assessment Committee were produced--The Collector mechanically fixed amount of compensation on basis of average price assessed--It is duty of respondents to provide information on basis of which compensation was determined and then to prove it through confidence inspiring evidence--The appellants led prima facie evidence in support of averments made in reference application which was enough to shift onus on respondents--The Referee Court failed to discharge its function in accordance with law--Reference of appellants is within time and decided it in favour of appellants and against respondents--The respondents did not file any appeal or cross-objection with regard to findings of Referee Court, attained status of finality--Appeal allowed. [Pp. 774, 775 & 776] C, D, F, G, H & I
Land Acquisition Act, 1894 (I of 1894)--
----Ss. 18--Opportunity to objections--Section 18 of Act provides an opportunity to a person to raise grounds and objections with regard to award and cast duty upon Referee Court to determine compensation of land which is subject matter of acquisition.
[P. 775] E
Land Acquisition Act, 1894 (I of 1894)--
----S. 23--Assessment of compensation--The assessment of compensation is made in light of Section 23 of Act which stipulates guiding principles for Courts to consider compensation one move of a person has an interest in acquired land and is aggrieved of compensation determined and settled through award. [P. 760] A
Land Acquisition Act, 1894 (I of 1894)--
----S. 23--Entitlement for compensation--Land owner is entitled for compensation at market value of land so acquired coupled with amount of damages sustained due to acquisition proceedings--A land owner is entitled to compensation in view of its future potential value and additional compensation for reverence, injurious affection and disturbance--The landowner is entitled to compensation and not just market-value, loss or injury occasioned by its severing from his property by change of residence or place of business and loss of profits are also relevant.
[Pp. 761 & 762] B
PLD 2004 SC 512 & PLD 2008 SC 386 ref.
Mr. Nadeem Babar, Advocate for Appellants.
Mr. Akhtar Ali Monga, Advocate for Respondents.
Date of hearing: 19.1.2022.
PLJ 2022 Lahore 754 (DB)
Present: Shahid Jamil Khan And Ahmad Nadeem Arshad, JJ.
PERVAIZ AKHTAR and others--Appellants
versus
LAND ACQUISITION COLLECTOR and others--Respondents
R.F.A. No. 75623 of 2019, decided on 19.1.2022.
Judgment
Ahmad Nadeem Arshad, J.--This Regular First Appeal under Section 54 of the Land Acquisition Act, 1894 (the Act) has been directed against the judgment and memo of cost, dated 15.11.2019, whereby the reference, filed under Section 18 of the Act ibid, was dismissed by the learned Referee Court.
2. Briefly, the facts, forming factual canvass of this appeal, are that land of the appellants measuring 194 kanal 15 marla was acquired through acquisition proceedings. Notification under Sections 4, 5 & 6 of the Act were issued on 24.04.2004, 07.11.2008 and 26.01.2009 respectively. The Board of Revenue assessed the price of the land on 30.05.2009 and finally the award was announced on 15.07.2009 and rate of the acquired land was fixed @ Rs. 400,000/- per acre. Feeling aggrieved, appellants filed reference before the Collector on 11.08.2009 which was sent to the learned Referee Court on 12.08.2009. The appellants claimed rate of the acquired land @ Rs. 35,00,000/- per acre besides raising certain objections with regard to the acquisition proceedings viz. fixation of price of land less than the market price; non-consideration of the objections raised by the appellants; proceedings of acquisition were conducted surreptitiously and the future potential of acquired land was not considered while fixing its price despite the fact that the acquired land is situated on the main roadside of Chak No. 334/JB which area falls within Category-A of agricultural land. The learned Referee Court registered the reference on 02.09.2009 and issued notices to respondents. Respondents No. 1 & 2 filed written reply on 19.11.2009 by raising preliminary objections that the appellants were estopped by their words and conduct to file the reference; that the reference is badly time barred; that the reference is false and frivolous as such the respondents are entitled to special costs and also denied all the facts pleaded in the reference by stating to be incorrect and prayed for dismissal of reference. The learned Referee Court, keeping in view divergent stances of the parties, framed following:
Issues:-
1. Whether the petitioner’s property was not evaluated and assessed by the respondents according to the market value and the petitioners are being compensated for less amount against the suit property, therefore, the petitioners are entitled for the enhancement of the compensation awarded by the respondents as prayed for?OPA.
2. Whether the petitioners are estopped by their words and conduct to file the petition? OPR
3. Whether the reference is badly time barred and liable to be dismissed? OPR
4. Whether the reference is false, frivolous and respondents are entitled to special cost in the event to dismissal of the reference? OPR.
5. Relief.
To prove their claim, the appellants examined Pervaiz Akhtar, one of the appellants, as AW-1, Muhammad Tariq as AW-2, Anwar-ul-Haq as AW-3, Jahangir Khan Halqa Patwari as AW-4, Bilal Hussain Patwari/Record Keeper NHA Faisalabad as AW-5, Sana Ullah Hinjra Tehsildar as AW-6, Muhammad Boota as AW-7. After remand Jahangir Patwari again appeared as AW-8, Pervaiz Akhtar as AW-9. In documentary evidence, the appellants produced Average Sale price as Exh.A-1, site-plan as Exh.A-2, copy of Award as Exh.A-3, copy of minutes of the meeting as Exh.A-4, copy of approval of estimated cost as Exh.A-5, copy of notification No. 708 as Exh.A-6, copies
of Jamabandies regarding Khewat No. 53 for the year 2007-08 as Exh.A-7, Exh.A-8, Exh.A-10 & Exh.A-11, copies of Jamabandies regarding Khewat No. 51 as Exh.A-9, & Exh.A-12, copy of index map as Exh.A-13, copy of announcement of award as Exh.A-14, attested copies of application alongwith reports regarding review of acquired land as Exh.A-15, attested copy of Mutation No. 1063 dated 24.06.2004 as Exh.A-16, attested copy of Mutation No. 1243 dated 31.03.2007 as Exh.A-17, attested copy of Mutation No1258 dated 21.07.2007 as Exh.A-18, attested copy of Mutation No. 875 dated 27.09.2006 as Exh.A-19, attested copy of Mutation No. 1760 dated 07.02.2015 as Exh.A-20, attested copy of Mutation No. 1780 dated 07.05.2015 as Exh.A-21, attested copy of Mutation No. 1400 dated 26.02.2010 as Exh.A-22, attested copy of Mutation No. 1503 dated 28.06.2011 as Exh.A-23, copy of application for review of assessment as Mark-A and copy of reports of field staff as Mark-B.
3. In rebuttal, the respondents produced Ghulam Rasool, Girdwar NHA as RW-1, Sajjad Mahmood Babar LAC as RW-2, Ghulam Rasool Land Acquisition Officer as RW-3, Muhammad Arshad Qanungo as RW-4. In documentary evidence, the respondents tendered copy of Mutation No. 1383 as Exh.R-1.
4. Besides, the appellants moved an application for appointment of local commission for ascertaining the value of the acquired property. The respondents filed contesting written reply. The learned Referee Court allowed the application vide order dated 08.07.2013 and appointed local commission for spot verification. The local commission submitted his report dated 24.07.2013 by stating that the price of the land is approximately 40/50 lacs per acre. The respondents filed objection petition which was allowed and report of local commission was rejected vide order dated 19.10.2013. The appellant moved fresh application for appointment of local commission which was again contested by respondents. The learned Referee Court allowed the application vide order dated 20.10.2014 and appointed local commission namely Mr. Imtiaz Ahmad Khan Advocate. The local commission submitted his report on 18.12.2014, the respondents again filed objection petition upon the report of local commission. The learned Referee Court vide order dated 23.02.2015 decided that the objection with regard to the report of local commission will be decided at the time of final decision of the reference. Imtiaz Ahmad Khan Advocate/Local Commission appeared as Court witness and recorded his statement as CW-1 and submitted his report as Exh.CW-1.
5. After recording evidence of the parties, pro and contra, decided the reference vide judgment and memo of cost dated 26.03.2015. Feeling aggrieved, the appellants preferred an appeal (R.F.A. No. 685 of 2015) before this Court which was allowed vide judgment dated 24.04.2018 and the impugned judgment and memo of cost dated 26.03.2015 was set-aside and the case was remanded to the learned Referee Court for deciding the same afresh after recording further evidence. The parties produced additional evidence. After providing opportunity of hearing to the parties, the learned Referee Court dismissed the reference vide judgment and memo of cost
dated 15.11.2019. Being dissatisfied, appellants preferred the instant appeal.
6. Learned counsel appearing on behalf of the appellants argued that the impugned judgment and decree passed by the learned Referee Court is against the law and facts; that impugned judgment is result of mis-reading and non-reading of oral as well as documentary evidence; that the land of the appellants is situated at roadside and best agricultural land, but despite this, the price was not properly assessed rather the appellants have been deprived of their precious land against petty amount; that the learned Referee Judge failed to examine that proper assessment of price of acquired land has never been made by the Land Acquisition Collector rather based his opinion on the recommendation of Price Assessment Committee which is alien to the scheme of law provided under the land Acquisition Act, 1894; that the learned Referee Court failed to give any findings with respect to the potential value and location of the acquired land while dismissing reference; that none of the settled parameters for determining compensation has been considered by the Land Acquisition Collector; that the appellants have been deprived of their right to the compensation provided under Section 34 of the Land Acquisition Act, 1894; that the recommendation of the Price Assessment Committee were tentative in nature which were considered as final in violation to the principles enumerated in Sections 23 & 24 of the Act; that the report of local commission was not brushed aside without giving any solid reason; that the appellants have been denied their fundamental rights enshrined in the Constitution of Islamic Republic of Pakistan, 1973 and finally beseeched for acceptance of this appeal.
7. Conversely, learned counsel for respondents-defendants, while defending the impugned judgment and memo of cost, argued that the learned Referee Court passed the impugned judgment and memo of cost strictly in accordance with law; that no mis-reading or non-reading of evidence on the part of the learned Referee Court has been pointed out by the learned counsel for the appellants; and the learned Referee Court applied correct law while considering the dicta laid down by superior Courts with regard to fixation of the compensation and prayed for the dismissal of the appeal.
8. We have heard learned counsel for the parties and perused the record with their able assistance.
9. With regard to the controversy between the parties, the learned Referee Court decided issue No. 1 in the following manner:
“As regards potential of the acquired land, the petitioners have not lead any evidence to show that the remaining land of the petitioners or any of the adjoining lands have either assumed the commercial character by building shops, housing societies or plazas etc., or gardens for that matter and the average sale price (Exh.A1) in the year 2004-05 was Rs. 2,02,303/- per acre whereas the petitioners have been awarded Rs. 4,00,000/- per acre therefore even Exh.A1 goes against the petitioners. Ex.A1 neither shows nature of the land nor gives details of price of lands situated alongside road and off road therefore Exh.A1 is not sufficient to determine value of the acquired land at the time of acquisition or any time after that.”
10. The Act is founded upon the doctrine that the interest of the public is supreme and that the private interests are subordinate to the interest of the State. The Act was promulgated for the purpose of compulsory acquisition of land needed for the public purpose and for determination of amount of compensation to be made on account of such acquisition. Although the Act has been devised to deprive citizens of their valuable rights in property through a somewhat coercive measures by State exercising authority under a Statue but such exercise should have been only for public purpose. However, bare reading of the Act leaves one with the strong impression that prime intent of the legislature was to ensure the protection of the rights of the citizens whose property is being acquired. They are to be given gold for gold and not copper for gold. In this background the scheme of law under Land Acquisition Act, 1894 is complete and exhaustive, which apart from mode of acquisition of land, provides a scheme containing mechanism for measurement of land, assessment of its value, payment of compensation to the affected persons and remedy in case of any dispute.
11. The scheme of the Act is very simple as it consists of fifty five sections divided into eight parts. The procedure of acquisition starts when a notification under Section 4 is issued notifying the land required for a public purpose and invited objections. The objection to such acquisition may be made by any person having interest in the property and the hearing is granted on the objections, if any, raised under Section 5-A of the Act whereas the determination that the land is required for public purpose is done by issuing declaration in the notification in terms of Section 6 of the Act. Section 11 postulates the enquiry and passing of the award by the Collector and while doing so, it requires the Collector to determine (i) the true area of the land (ii) the compensation which in his opinion should be allowed for the land and (iii) the apportionment of the said compensation amongst all the persons known or believed having interest in the land, of whom or of whose claim, he has information, whether or not they have respectively appeared before him. Section 12 of the Act states that the award of the Collector shall be final and conclusive evidence as between the Collector and the person interested, in respect of the amount of compensation. It has, however, been held that the award is merely an offer to tender the compensation to the owner of the property and if the offer is not acceptable, Section 18 of the Act grants the owner of the land a statutory remedy for seeking determination of the amount of compensation from the Court by filing Reference before the Collector.
“Matters to be considered in determining compensation.--(1) In determining the amount of compensation to be awarded for land acquired under this Act, the Court shall take into consideration--
first, the market-value of the land at the date of the publication of the notification under Section 4, sub-section (1).
Explanation.--For the purpose of determining the market-value, the Court shall take into account transfer of land similarly situated and in similar use. The potential-value of the land to be acquired if put to a different use shall only be taken into consideration if it is proved that land similarly situated and previously in similar use has, before the date of the notification under sub-section (1) of Section 4, been transferred with a view to being put to the use relied upon as affecting the potential value of the land to be acquired: Provided that–
(i) if the market-value has been increased in consequence of the land being put to a use which is unlawful or contrary to public policy that use shall be disregarded and the market-value shall be deemed to be the market- value of the land if it were put to ordinary use; and
(ii) if the market-value of any building has been increased in consequence of the building being so overcrowded as to be dangerous to the health of the inmates, such overcrowding shall be disregarded and the market-value shall be deemed to be the market-value of the building if occupied by such number of persons only as can be accommodated in it without risk of danger to health from overcrowding].
secondly, the damage sustained by the person interested, by reason of the taking of any standing crops or trees which may be on the land at the time of the Collector's taking possession thereof;
thirdly, the damage (if any) sustained by the person interested, at the time of the Collector's taking possession of the land, by reason of severing such land from his other land;
fourthly, the damage (if any) sustained by the person interested, at the time of the Collector's taking possession of the land, by reason of the acquisition injuriously affecting his other property, movable or immovable, in any other manner, or his earnings;
fifthly, if, in consequence of the acquisition of the land by the Collector, the person interested is compelled to change his residence or place of business, the reasonable expenses (if any) incidental to such change; and
sixthly, the damage (if any) bona fide resulting from diminution of the profits of the land between the time of the publication of the declaration under Section 6 and the time of the Collector's taking possession of the land.
[(2) In addition to the market-value of the land as above provided, the Court shall award a sum of fifteen per centum on such market-value, in consideration of the compulsory nature of the acquisition, if the acquisition has been made for a public purpose and a sum of twenty-five per centum on such market-value if the acquisition has been made for a Company].”
(i) That an entry in the Revenue Record as to nature of the land may not be conclusive, for example, land may be shown in Girdawri as Maira, but because of the existence of a well near the land, makes it capable of becoming Chahi land;
(ii) That while determining the potentials of the land, the use of which the land is cable of being put, ought to be considered;
(iii) That the market value of the land is normally to be taken as existing on the date of publication of the notification under Section 4(1) of the Act but for determining the same, the prices on which similar land situated in the vicinity was sold during the preceding 12 months and not 6-7 years may be considered including other factors like potential value etc.”
Further, the apex Court of the country in the matter of “Murad Khan v. Land Acquisition Collector” (1999 SCMR 1647) defined the term “Market value” with specific reference Section 23 of Act in the following manner:-
(i) The data from which the market value of the land can be estimated is given in Rule 13 of the North West Frontier Province Circular No. 54 issued presumably under Section 55 of the Act. (Premier Sugar Mills Limited v. Hayatullah Khan (PLD 1956 (W.P) Pesh.67).
(ii) The best method to work out the market value is the practical method of a prudent man laid down in Section 3 of the Evidence Act to examine and analyse all the material and evidence available on the point and to determine the price which a willing purchaser would pay to willing seller of the acquired land. “The Land Acquisition Collector, Rawalpndi v. Lieut. General Wajid Ali Khan Burki (PLD 1960 (W.P) Lah. 469).
(iii) Subsection (1) of Section 23 of the Act provides that in determining the amount of compensation the Court shall take into consideration the market value, loss by reason of serving such land from his other land, acquisition injuriously affecting his property or his earning in consequence of change of residence or place of business and damage, if any, resulting from diminution of the profits of the and between the time of the publication of the declaration under Section 6 and the time of the Collector's taking possession of the land. This, however, is not exhaustive of other injuries or loss which may be suffered by an owner on account of compulsory acquisition. (Province of West Pakistan and an other v. M. Salim Ullah and others (PLD 1966 SC 547).
(iv) The best method of determination of the market price of the plots of land under the acquisition is to rely on instances of sale of it near about the date of notification under Section 4(1) of the Act. The next best method is to take into consideration the instances of sale of the adjacent lands made shortly before and after the notification. When the market value is to be determined on the basis of the instances of sale of land in the neighbouring locality, the potential value of the land need not be separately awarded because such sales cover the potential value. (Jogendra Nath Chatterjee and others v. State of West Bengal (AIR 1971 Caleutta 458).
(v) It is obvious that the law provides determination of compensation not with reference to classification or nature of land but its market value at the relevant time. No doubt, for determining the market value, classification or the nature of land may be taken as relevant consideration but that is not the whole truth. An area may be Banjar Qadeem or Barani as in the present case but its market value may be tremendously high because of its location, neighbourhood, potentiality or other benefits. (Pakistan and another v. Rehm Dad and another (1980 CLC 574.).
(vi) According to the well-settled principle, while determining the value of the compensation the market value of the land at the time of requisition/acquisition and its potentiality have to be kept in consideration. (Pakistan v. Din Muhammad and others (1983 CLC 1281).
(vii) Consideration should be had to all the potential uses to which the land can be put, as well as all the advantages, present or future, which the land possesses in the hands of the owners. (Mst. Khatu and others v. Barrage Mukhtiarkar, Thatta (PLD 1977 Kar. 203).
(viii) In determining the quantum of fair compensation the, main criterion is the price which a buyer would pay to a seller for the property if they voluntarily entered into the transaction. (Din Muhammad v. General Manager, Communication and others (PLD 1978 Lah. 1135).
(ix) The measure of fair compensation is the value of the property in open market which a seller voluntarily entering into a transaction of sale can reasonably demand from a purchaser this means that we, have to determine the value of the land in the open market at the relevant time on the assumption that the notification of acquisition did not exist. (Province of Punjab v. Sher Muhammad and another (PLD 1983 Lah. 578).
(x) While determining the value of the land acquired by the Government and the price which a willing purchaser would give to the willing seller, only the past sales' should not be taken into account but the value of the land with all its potentialities may also be determined by examining (if necessary as Court witness) local property dealers or other persons who are likely to know the price that the property in question is likely to fetch in the open market. In appropriate cases there should be no compensation even relying upon the oral testimony with respect to market value of the property intended to be acquired, because even while deciding cases involving question of life and death, the Courts rely on oral testimony alone and do not insist on the production of documentary evidence. The credibility of such witnesses would, however, have to be kept in mind and it would be for the Court in each case to determine the weight to be attached to their testimony. It would be useful and even necessary, to examine such witnesses while determining the market prices of the land in questions because of the prevalent tendency that in order to save money on the purchases of stamp papers and to avoid the imposition of heavy gain tax levied on sale of property, people declare or show a much smaller amount as the price of the land purchased by them than the price actually paid. The previous sales of the land, cannot, therefore, be always taken to be an accurate measure for the determining the price of land intended to be acquired. (Fazalur Rehman and others v. General Manager, S.I.D.B. and another (PLD 1986 SC 158).
(xi) The sale-deed and mutation entries do serve as an aid to the prevailing market value. (Government of Pakistan v. Maulvi Ahmed Saeed (1983 CLC 414).
(xii) It is a well-settled law that in cases of compulsory acquisition effort has to be made to find out what the market value of the acquired land was or could be on the material date. While so venturing the most important factor to be kept in mind would be the complexion and land on the material date. The potentialities it possessed on that date are also to be kept in view in determining a fair compensation to be awarded to the owner who is deprived of his land as a result of compulsory acquisition under the Act. (Central Government of Pakistan v. Sardar Fakhar-e-Alam and another (1985 CLC 2228).
(xiii) The value of the land of the adjoining area which was simultaneously acquired and for which different formula of compensation has been adopted, should be taken into consideration. (Raza Muhammad Abdullah through his Legal Heirs v. Government of Pakistan and others (1986 MLD 252).
(xiv) The phrase "market value of the land" as used in Section 23(1), of the Act means "value to the owner and, therefore, such value must be the basis for determination of compensation. The standard must be no, subjective standard but an objective one. Ordinarily, the objective standard would be the price that owner willing and not obliged to sell might reasonably expect to obtain from a Willing purchaser, The property must be valued not only with reference to its condition at the time of the determination but its potential value must be taken into consideration. (Abdul Wahid and others v. The Deputy Commissioner (1986 MLD 381).”
Similarly, the Hon’ble Supreme Court of Pakistan in its celebrated decision reported as “Province of Sindh Through Collector of District Dadu and others v. Ramzan and others ” (PLD 2004 SC 512) declared that land owner is entitled for compensation and not the market value. Relevant portion of the said decision reads as under:
“The most important aspect qua the lands compulsorily acquired is, that the mandatory returns proposed to be given to the landowner is the compensation and not the market value. very Section 23 provides for various matters to be brought under consideration while determining compensation. Market value is only one of such matters to be considered by the Collector or Courts. Compensation is a very wider term indicating that the landowners, for various reasons, is to be compensated and not merely paid the price of land which is just an interaction of supply and demand fixed between a willing buyer and willing seller.
Section 23 was subsequently amended through West Pakistan Ordinance 49 of 1969 whereby the ambit or matters to be considered was widened and it was in this background that the Courts in the country emphasized the phenomenon of potential value of the land. This term potential value is only a one word used for the future uses which the land can be put to. In Malik Aman's case (PLD 1988 SC 32) this Court had explained the feature of potential value arid had differentiated the same from the term „market value‟. It was held that market value was normally to be taken as one existing on the date of Notification under Section 4(1) of the Land Acquisition Act under the principle of willing buyer and willing seller while the potential value was explained to be one to which the similar lands could be put to any use in future. Factors for determining compensation of land are not restricted only to the time of the aforesaid Notification but can also relate to period in future and that is why in a large number of cases the potential value' has been held to be a relevant factor.”
Further, the Hon’ble Supreme Court of Pakistan in a case reported as titled as “Malik Hadi Husain and others versus Land Acquisition Collector and another” (PLD 2008 Supreme Court 386) declared that the Court while determining the compensation should have to consider the potential and future prospective of land in addition to one year average. Relevant portion from the said judgment is reproduced herein below:
“It needs no reiteration that while determining the amount of compensation, Court is to consider evidence brought on the record by the parties and further Land Acquisition Collector while determining compensation of acquired land has also to consider the potential and future prospective of land in addition to one year average. While determining the value of the land acquired by the Government and the price which willing purchaser would give to the willing seller, only the past sale should not be taken into account but the value of the land with all its potentiality may also be determined by examining other facts.
An assessment of the compensation payable for land acquired must take into account several 1actors, including the nature of the land, its present use and its capacity for a higher potential, its precise location in relation to adjoining land, the use to which neighbouring land has been put and the impact of such use on the land acquired, and so on having regard to all these factors.”
Likewise, the Hon’ble Supreme Court of Pakistan in case of “Land Acquisition Collector and others versus Mst. Iqbal Begum and others” (PLD 2010 SC 719) has clinched the issue, under discussion, in the following manner:
“The nature of land has been considered by taking into consideration its potentiality and locations. It is worth mentioning that the potentiality of land should not be determined merely at the time of issuance of notification under Section 3 of the Act but it should be also with reference to the use to which land is reasonably capable of being put in the future. Reference in this regard can be made to Market Committee v. Rayyat Ali (1991 SCMR 572)
The main object of Land of Acquisition Act is to provide complete indemnity to the owner and no property is to be acquired without proper and adequate compensation. (Chairman, Serampore Municipality v. Secretary of State for India AlR 1922 Calcuta 386, West Pakistan WAPDA v. Hiran begum 1972 SCMR 138))
The principles laid down for determination of compensation reflect anxiety of law-giver to compensate those deprived of property adequately enough so as to be given gold for gold and not copper for gold.(Nazarul Hussain v. Collector PLD 1990 Lahore 472, Land Acquisition Officer v. Kambar Ali Beg (1981 CLC 556). Various factors have to be taken into consideration i.e. the size and shape of the land, the locality and its situation, the tenure of property, the user, its potentiąl value, and the rise or depression in the value of the land in the locality and even in its near vicinity.
It is well settled by now that "to determine compensation the Court must ascertain the value on the date of notification, considering various factors including nature and location of acquired land and sale price of adjoining lands. In assessing market value of land, its location, potentiality and price evidenced by transactions of similar land at the time of notification are factors which should be kept in view. One year's average of sales taking place before publication of notification under Section 4 of similar land is merely one of the modes of ascertaining market value and is not an absolute yardstick for assessment of compensation. Moreover, status of acquired land, its potentialities and its likelihood of development and improvement would be necessary factors for determining rate of compensation.)
We are not impressed by the contention of learned Advocate Supreme Court on behalf of appellants that the determination of compensation should be based merely on the "past sales" for the reason that the potentiality of land cannot be determined without examining its future prospects and therefore, compensation cannot be based merely on the basis of “past sales”. In this regard, we are fortified by the dictum laid down in the following authorities:-
Collector, Land Acquisition v. Abdur Rashid (1966 CLC 1193), West Pak. WAPDA v. Hiran Begum (1975 S.C.M.R. 138), Islamic University, Bahawalpur v. Khadim Husain 1990 MLD 2158), Government of Pakistan Rawalpindi and another v. Malik Muhammad Aslam and 5 others (1978 S.C.M.R. 5).
We cannot overlook the well entrenched principle i.e. “what a willing purchaser would have paid for the land for the land in question” which is to be followed while fixing the compensation. If any authority is needed, reference can be made to Government of Pakistan Rawalpindi and another v. Malik Muhammad Aslam and 5 others (1978 S.C.M.R. 5).”
Identically, the Hon’ble Supreme Court of Pakistan in the matter of “Province of Punjab through Land Acquisition Collector and another versus Begum Aziza” (2014 SCMR 75) while discussing the earlier precedent law on the subject held that in determining the quantum of compensation the exercise may also not be restricted to the time of notification but its future value may be taken into account.
Moreover, the august Supreme Court of Pakistan while defining the term “Market Value” in the case reported as “Land Acquisition Collector versus Mst. Surraya Mahmood Jan” (2015 SCMR 28) has held that:
“The principles that can be gleaned from the aforesaid judicial precedents are that the term market value as employed in Section 23 of the Act of 1894 implies the price that a willing purchaser would pay to a willing buyer in an open market arm‟s length transaction entered into without any compulsion. Such determination must be objective rather than subjective. While undertaking this exercise, contemporaneous transactions of the same, adjoining or adjacent as well as the land in the same vicinity or locality; in dissenting precedents, may be taken into account. An award of compensation a similar, adjacent, adjoining land or in respect of the land acquired in the same vicinity or locality cannot be ignored. The classification of the land in the Revenue Record cannot be the sole criteria for determining its value and its potential i.e. the use of which the said land can be put, must also be a 1actor. In this behalf, the use of the land in its vicinity needs to be examined.”
In “Government of Pakistan through Military Estate Officer, Abbottable and another v. Ghulam Mustaza and others” (2016 SCMR 1141) the august Supreme Court of Pakistan has held as under:
“It has been repeatedly laid down that being a compulsory acquisition of land for public purposes, the owners of the land are deprived of its utility while at the same time the Collectors Acquisition simply impose their own opinion ordinarily based on one year average which is not a correct approach to the matter, as has been laid down by this Court.”
It was further held in “Air Weapon Complex through D.G. versus Muhammad Aslam and others” (2018 SCMR 779) that:
“It is settled law that in assessing compensation of acquired land, the following factors are to be taken into consideration:
(a) its market value at the prevalent time and its potential;
(b) one year average of sale taken place before publication of notification under Section 4 of the Act of the similar land;
(c) its likelihood of development and improvement;
(d) a willing purchaser would pay to a willing buyer in an open market arms length transaction entered into without any compulsion;
(e) loss or injury occurred by severing of acquired land from other property of the land owner;
(f) loss or injury by change of residence or place of business and loss of profit;
(g) delay in the consummation of acquisition proceedings and;
(h) peculiar facts and circumstances of each case.”
14. After taking into account the afore-referred case- law on the subject, we have come to the conclusion that following via media should be followed while determining the compensation of the acquired land:-
a. The best method to work out the market value is the practical method of a prudent man as laid down in Qanoon-e-Shahadat Order 1984 to examine and analyze all the material and evidence available on the point and to determine the price which a willing purchaser would pay to willing seller of the acquired land.
b. The Court shall take into consideration the market value, loss by reason of severing such land from his other land, acquisition injuriously affecting his other property or his earning in consequence of change of residence or place of business and damage, if any, resulting from diminution of the profits of the land between the time of the publication of the declaration under Section 6 of the Act and the time of the Collector's taking possession of the land. This, however, is not exhaustive of other injuries or loss which may be suffered by an owner on account of compulsory acquisition.
c. The phrase "market value of the land" as used in Section 23(1), of the Act means "value to the owner" and, therefore, such value must be the basis for determination of compensation. The standard must be no subjective standard but an objective one. Ordinarily, the objective standard would be the price that owner willing and not obliged to sell might reasonably expect to obtain from a willing purchaser. The property must be valued not only with reference to its condition at the time of the determination but its future potential value must be taken into consideration.
d. While determining the potentials of the land, the use of which the land is capable of being put, ought to be considered;
e. Consideration should be had to all the potential uses to which the land can be put, as well as all the advantages, present or future, which the land possesses in the hands of the owners.
f. While determining the value of the land acquired by the Government and the price which a willing purchaser would give to the willing seller, only the past sales' should not be taken into account but the value of the land with all its potentialities may also be determined by examining (It necessary as Court witness) local property dealers or other persons who are likely to know the price that the property in question is likely to fetch in the open market. In appropriate cases there should be no compunction even relying upon the oral testimony with respect to market value of the property intended to be acquired, because even while deciding cases involving question of life and death, the Courts rely on oral testimony alone and do not insist on the production of documentary evidence. The credibility of such witnesses would, however, have to be kept in mind and it would be for the Court in each case to determine the weight to be attached to their testimony. It would be useful and even necessary, to examine such witnesses while determining the market prices of the land in questions because of the prevalent tendency that in order to save money on the purchases of stamp papers and to avoid the imposition of heavy gain tax levied on sale of property, people declare or show a much smaller amount as the price of the land purchased by them than the price actually paid. The previous sales of the land, cannot, therefore, be always taken to be an accurate measure for the determining the price of land intended to be acquired.
g. In determining the quantum of fair compensation the, main criterion is the price which a buyer would pay to a seller for the property if they voluntarily entered into the transaction. The assumption being that sale is being taken place in open market as if notification of acquisition did not exist.
h. In cases of compulsory acquisition effort has to be made to find out what the market value of the acquired land was or could be on the material date. While so venturing the most important factor to be kept in mind would be the complexion and character of the acquired land on the material date. The potentialities it possessed on that date are also to be kept in view in determining a fair compensation to be awarded to the owner who is deprived of his land as a result of compulsory acquisition under the Act.
i. When the market value is to be determined on the basis of the instances of sale of land in the neighboring locality, the potential value of the land need not be separately awarded because such sales cover the potential value.
j. An entry in the Revenue Record as to the nature of the land should not be considered conclusive, for example, land may be shown in Girdawari as Maira, but because of the existence of a well near the land, makes it capable of becoming Chahi land;
k. It is obvious that the law provides determination of compensation not with reference to classification or nature of land but its market value at the relevant time. No doubt, for determining the market value, classification or the nature of land may be taken as relevant consideration but that is not the whole truth. An area may be Banjar Qadeem or Barani but its market value may be tremendously high because of its location, neighborhood, potentiality or other benefits.
l. The value of the land of the adjoining area which was simultaneously acquired and for which different formula of compensation has been adopted, should be taken into consideration.
m. In determining the quantum of compensation, the exercise may not be restricted to the time of the aforesaid notification but its future value may be taken into account.
n. The sale-deed and mutation entries do serve as an aid to the prevailing market value.
15. A bird’s eye view of the material before us leads to indubitable conclusion that the learned Referee Court completely misdirected itself while dismissing the reference of the appellants. It is established principle of law that onus to prove the Issue shifts on the opposite side once prima facie evidence is led by the plaintiff. The appellants in order to strengthen their case produce oral as well as documentary evidence. One of the appellants namely Pervaiz Akhtar appeared as AW-1 and deposed in line with his reference by stating that the revenue staff and officers assessed average sale price as Rs. 15,76,000/- per acre; that value of the land situated at the road-side is more than one karor rupees per acre. AW-2 & AW-3 also corroborated the version of AW-1 and deposed in the same line. Appellants produced revenue Patwari as AW-4 who deposed that average sale price for the years 2004-05 to 2008-09 was prepared by him and produced it as Exh.A-1. He further stated that he produced map of Squares No. 54, 55 & 69 situated at Chak No. 334 J.B. District Toba Tek Singh as Exh.A-2 whereby he showed the spot situation in purple colour which is prepared by him and bears his signature.
16. From perusal of Exh.A-1 it appears that the average sale price per acre was Rs. 323,614/- and market value as Rs. 35,00,000/- per acre. The appellants moved an application for review of the assessed price of the acquired land. The Revenue Officer called upon reports from the field staff. Copy of the application is available as Mark-A and reports of the field staff as Mark-B, whereby the Patwari reported on 08.12.2007 that average sale price in the year 2005-06 was Rs. 15,76,000/- per acre whereas market value was Rs. 35,00,000/- This report was endorsed by the Girdwar on 10.12.2007 and by Tehsildar on 03.03.2008. The appellants also produced copy of Mutation No. 1063 dated 24.06.2004 as Exh.A-16, whereby land measuring 01 kanal was sold for Rs. 200,000/-, meaning thereby per acre price was Rs. 16,00,000/-, copy of Mutation No. 1243 dated 31.03.2007 as Exh.A-17, whereby land measuring 02 kanal 10 marla was sold for Rs. 15,00,000/-meaning thereby per acre price was Rs. 48,00,000/- per acre, copy of Mutation No. 1258 dated 21.07.2007 as Exh.A-18, whereby land measuring 01 kanal 13 marla was sold for Rs. 700,000/-, meaning thereby per acre price was Rs. 33,93,939/- per acre, copy of Mutation No. 875 dated 27.09.2006 as Exh.A-19, whereby land measuring 11 kanal 09 marla was sold for Rs. 64,68,000/- meaning thereby per acre price was Rs. 45,19,126/- per acre, copy of Mutation No. 1760 dated 07.02.2015 as Exh.A-20, whereby land measuring 02 kanal was sold for Rs. 22,50,000/-, meaning thereby per acre price was Rs. 90,00,000/- per acre, copy of Mutation No. 1780 dated 07.05.2015 as Exh.A-21, whereby land measuring 05 marla was sold for Rs. 25,00,000/-, meaning thereby per acre price was Rs. 80,00,000/- per acre, copy of Mutation No. 1400 which was sanctioned on the basis of registered sale deed dated 26.06.2010 as Exh.A-22, whereby land measuring 04 kanal was sold for Rs. 21,00,000/-, meaning thereby per acre price was Rs. 42,00,000/- per acre, copy of Mutation No. 1503 dated 28.06.2011 as Exh.A-23, whereby land measuring 03 kanal 17 marla was sold for Rs. 20,00,000/-, meaning thereby per acre price was Rs. 41,55,844/- per acre.
17. From perusal of report of local commission (Exh. CW-1) which he submitted while recording his statement as Court Witness, it appears that the acquired land was situated at the roadside of Jhang-Faisalabad main road. He reported that the revenue authorities themselves assessed the market value of the land in the year 2007-08 as Rs. 35,00,000/- per acre, however, he observed that in the year 2007-08, the price of the land was more than Rs. 35,00,000/- per acre and that the market price of the land of the appellants was not less than Rs. 68,00,000/- per acre as the suit land is situated at main Jhang-Faisalabad road near Pansera city. He also reported that land of the appellants is situated near populated area of Abadi-Deh as well as commercial area. He further narrated that due to acquisition, the land of the appellants was bifurcated into different parts and is no longer cultivable. He also explained that rent of that land was Rs. 50,000/- per acre and the appellants have faced heavy loss due to acquisition process and suggested that the appellants be compensated by acquiring their remaining land at the rate of Rs. 65,00,000/- per acre. Similar type of report was submitted by earlier appointed Local Commission which was rejected by the Court on the objection of the respondents.
18. In rebuttal, the respondents got examined Ghulam Rasool Girdwar NHA as RW-1. He during cross-examination admitted that the land of the appellants which was acquired was situated near the populated area. He also admitted it as correct that acquired land is situated at the main road. He showed his ignorance that the price of the acquired land the relevant time was more than Rs. 40,00,000/- per acre. Instead of denying the suggestion straightway, he showed his lack of knowledge whether the price of land which was acquired at the road side of Faisalabad-Jhang road is more than one Karor rupees per acre. The respondents also got examined RW-2 Sajjad Mehmood Babar, Land Acquisition Collector, Ghulam Rasool, Land Acquisition Officer as RW-3 who, during the cross-examination, also admitted that the acquired land is 01 k.m. away from Jhang road and near to Abadi Deh. Respondents also produced Muhammad Arshad Girdwar as RW-4. The respondents produced copy of Mutation No. 1383 whereby land measuring 390 kanal was sold for Rs. 50,00,000/-.
22. According to Exh.A-1, which is prepared by the Patwari and endorsed by him during recording his evidence as A.W-1, he described the average market value in the year 2008-09 as Rs. 35,00,000/- per acre; that said Goshwara of average sale price is verified from report of Patwari dated 08.12.2007 and report of Girdawar dated 10.12.2007 which was placed on record as Mark-B whereby it was reported that average sale price in the year 2005-06 was Rs. 15,76,000/- per acre and market value was Rs. 35,00,000/- per Acre; that according to Exh.A-17 (Mutation No. 1243) sale price was Rs. 48,00,000/- per acre; that according to Exh.A-18 (Mutation No. 1258) sale price was Rs. 33,93,939/- per acre; that according to Exh.A-19 (Mutation No. 875) sale price was Rs. 45,19,126/- per acre; according to Exh.A-20 (Mutation No. 1760) sale price was Rs. 90,00,000/- per acre; according to Exh.A-21 (Mutation No. 1780) sale price was Rs. 80,00,000/- per acre; all that mutations are with regard to land situated at Chak No. 334 Jeem-Bay, Tehsil Gojra, District Toba Tak Singh and were sanctioned before announcement of award. The learned Referee Court appointed Local Commission twice and they made similar type of reports. The Local Commission in its report (Exh.CW-1) assessed the value of land Rs. 68,00,000/- per acre. The evidence of the appellants was remained unrebutted. The findings of the learned Referee Court are reversed and modified. So, keeping in view the available evidence, we assessed the value and compensation of acquired land as Rs. 35,00,000/- per acre and declared that appellants are required to be compensated, for loss amount, against the land acquired by the respondents. Issue No. 1 is decided in the above terms.
24. In the light of above discussion and evidence available on the record, the instant appeal is allowed, the impugned judgment and memo. of cost is, hereby, set-aside. Resultantly, appellants are declared entitled to get compensation at the rate of Rs. 35,00,000/- per acre along with 15% compulsory charges and simple interest @ 8% from the date of possession till payment of compensation. No order as to costs.
(Y.A.) Appeal allowed
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