Madhavan Nair, J.

1. Their Lordships had occasion to consider the nature of the cantonment tenure in a land acquisition case which came before the Board recently from the Poshawar Cantonment: Hari Chand v. Secretary of State for India (1939) L.R. 66 I.A. 258, 262. In that case their Lordships observed that Ibid. 259 " where the "Government grant any rights to individuals within the area "of the cantonments one of the cardinal conditions of the "grant is that the Government retain the power of resumption "at any time on giving one months notice. If they give "that notice, they are required to pay the value of such "buildings as may have been authorized to be erected."

2. Their Lordships think it will be advantageous to state at the outset that though various questions were raised before the lower courts the learned Counsel for the Secretary of State, the appellant, has presented for their Lordships consideration only one question, namely, what is the correct principle that should be applied in valuing under the Land Acquisition Act a building which stands on land belonging to another and not to the owner of the building, as in the present case. The respondent has not been represented, but Mr. Tucker has placed fully before their Lordships all the relevant facts and arguments.

3. In this appeal by the Secretary of State it is contended that the basis of valuation adopted by the High Court is incorrect, and that the true principle of assessing compensation for the buildings, apart from the site, is to ascertain the cost of reproducing the buildings at the time of the compulsory acquisition, allowing for depreciation in consideration of the age and condition of the buildings, and for the cost of necessary repairs.

4. This principle was adopted as correct by this Board in Hari Chands case, already referred to L.R. 66 I.A. 258, where it is enunciated as the correct principle. In that case their Lordships state it as follows Ibid. 262:



The subject to be valued being a building apart from the "site, the principle of fixing value by ascertaining the cost "of reproducing the building at the present time, and then "allowing for depreciation in consideration of the age of "the building and for the cost of such repairs as might be "required apart from depreciation, is quite a well known "and recognized method of valuing buildings for the purpose "of compensation. That method was pursued here, and that "method is not, as their Lordships conceive it, affected by "the resumption notice, because the prices which would be "taken, and were taken in this case, for the purpose of "ascertaining the cost of reproducing the building would "not be affected by the resumption notice at all.

5. Although the learned judges of the High Court agreed with the District Judge that the land was the property of the Government, and that the Secretary was entitled to resume it without paying any compensation therefor, and that the only compensation due was compensation for the buildings, which alone were compulsorily acquired, they would appear to have thought that they were entitled to assess this latter compensation on an assumed rental basis, and for that purpose to take into account the lease, which they said " should be "taken into account as Government was bound to carry "out its obligations under the registered lease." It is clear that the lease was subject to the right of resumption by the Government, unless it could be maintained that the Government were not entitled to exercise the right of resumption during the currency of the lease, but the learned judges agree that the land has been validly resumed, and it necessarily follows that, as from the date of resumption, the respondent ceased to have any right to keep the buildings on the land or to claim rent from a tenant, and there is no room for assessing upon an assumed rental basis the compensation for the value of the buildings as materials standing upon a site, but liable to be removed at any moment.

6. In their Lordships opinion, the District Judge has applied the correct principle in valuing the buildings in this case. The result is that their Lordships will humbly advise His Majesty that the appeal should be allowed, and that the District Judges decree should be restored.

7. The appellant will have the costs of this appeal, and also his costs in the High Court.