Ramalingam Sudhakar, C.J. (ORAL) - Heard Mr. S. Samarjeet, learned CGC for the Union of India, and Mr. Modhusudon, learned counsel appearing for the respondent.

2. The Union of India has filed this appeal challenging the order of the District Judge, Imphal West, in O.S. (LA.) No. 1 of 2009/2/2013 decided on 19.10.2016.

3. This judgment which is under challenge was passed by the District Judge, Imphal West, exercising the power in terms of section 23 of the Land Acquisition Act, 1894, determining higher compensation to be awarded for the land acquired. The claimant has also filed an appeal being L.A. APP. No. 2 of 2017 for a limited relief, namely, as pleaded by Mr. Modhusudon, learned counsel appearing for the appellant therein, that the rate of interest on the enhanced compensation amount should be 9 % in terms of section 28 of the Land Acquisition Act, 1894, and not 6 % as determined by the reference court. He also pleads for interest for the delayed payment in terms of proviso under Section 28 of the Act.

4. The land in question falls within the Modi Village, Chandel District to an extent of about 310 acres and also on Beru Angthi Village, Chandel District, Manipur, for the purpose of establishment of 26th Sector Assam / 24 Assam Rifles. Notification under section 4 of the Land Acquisition Act, 1894 was issued on 02.12.2005. By notification No. 21/385/2004-R dated 17.02.2016, declaration in terms of section 6 of the Land Acquisition Act, hereinafter called the Act was issued by the Government of Manipur Secretariat, Revenue Department.

5. After due process, as required under the provisions of Land Acquisition Act 1894, the Collector, Land Acquisition, Chandel, passed an award on 29.01.2007. Relevant paras concerned with Modi Village in the present case reads as follows :-

"Modi Village

Sl.

No.

Classification of land

-

Area of land

Rate/per

acre

T. Amount

1.

Ag ricu ltu ral/Cultivable Wet land

-

60

acres

Rs.

1,00,000/-

Rs.

60,00,000/-

2.

Ingkhol/Homstead

land

-

40

acres

Rs.

50,000/-

Rs.

20,00,000/-

3.

Jhum/terrace land

-

200

acres

Rs.

25,000/-

Rs.

50,00,000/-

Total

300

acres

Rs.

1,30,00,000/-

(ii) The next point for determination is the damage sustained by the person interested by reason of taking of any standing properties such as crops, trees etc. which may be on the land described above at the time of the collectors taking possession thereof. In this connection, the value of which is yet assessed nor there is no claim on this point.

After having examined the relevant facts, circumstances and having perused the documents and records I hereby made the award for payment of compensation to the land owners for 310 acres of land for Establishment of Headquarters of 26th Sector of 24

- Assam Rifles i.e, 300 acres of Modi and 10 acres of Bern Angthi Villages, Chandel District, Manipur as details below."

6. Objecting to the determination of compensation, a petition was filed under section 18 of the Land Acquisition Act, 1894 on 28.02.2007 on the following issue :-

"(a) For that, the land has been greatly undervalued and that the market value should have been held as follows :

(i) Cultivable wet land/Agricultural Land Rs. 1,50,000/- per acre

(ii) Homestead Land/Jhum/terrace land Rs. 1,00,000/- per acre

(b) For that the learned Collector should have assessed the damage sustained by the land owners by reason of taking of the standing properties such as pine trees and plain trees etc. on the acquired land at the time of the Collectors taking possession thereof, and should have awarded Rs. 1000/- per pine tree and Rs. 200/- per plain tree."

7. Objection was filed by the Union of India and thereafter, the impugned order was passed by the reference Court which is under challenge. The reference Court, for the purpose of determining the quantum of compensation for the land acquired on per acre basis, primarily relied upon the decision of the Government of Manipur High Level Committee under the Chairmanship of the Chief Minister who determined the land value as on 19.06.1993 for another project and which was implemented in the subsequent land acquisition proceedings. The reference Court relied upon the order passed in O.S. (L.A.) No. 1 of 1996 to the 1993 Government order, and also took note of the fact that the determination of value of land per acre at Rs. 1 lakh in respect of agricultural land has been upheld by this Court by the order dated 23.2.1999 and 24.02.1999 in the First Appeal No. 1 of 1997 and M.A. (F) No. 4 of 2018. Since there was no data sale deed which is also evident from the award itself, the reference Court proceeded to fix the value of land per acre on the same analogy in respect of an acquisition in terms of notification dated 02.12.2005. The relevant paragraph of the order of the reference Court is as follows :-

"13. The Honble Apex Court in the case of Md. Raofuddin vs. Land Acquisition Officer reported in (2009) 14 SCC 367 [LQ/SC/2009/824] and in the case of Ravinder Narain and Anr. vs. Union of India reported in (2003) 4 SCC 481 [LQ/SC/2003/292] observed that best method of finding out the value of land is comparable sale method. If such sale instances are not available, the other best method for calculation of the just compensation is to look into the award passed in a land acquisition proceeding relating to the lands adjacent to the present acquisition.

In the case record, a letter of the present complainant, S.T. Wang tong, dated 7th March, 2006 addressed to the Collector, L.A., Chandel is found and in the said application, the present claimant has stated that on 19-6-1993, the Govt. of Manipur constituted a High Level Committee under the Chairmanship of the Chief Minister of Manipur known as the "High Level Thoubal Project Rehabilitation and Re-Settlement Committee" for the purpose of assessing and fixing the rate of compensation for the Thoubal Multipurpose Project being duly approved by the State Government then and consequently fixed the rates of compensation under the following categories of land as follows:

1. Agricultural land - Rs. 1,00,000/- per acre.

2. Ingkhol/Homestead land - Rs. 50,000/- per acre.

3. Forest/ Jhum, land - Rs. 25,000/- per acre.

In the said letter, it is also mentioned that the Khuga Dam Affected Area Committee, Churachandpur and the Khuga Dam Submerged Area Committee, Churachandpur claimed to pay them the aforesaid compensation amount so fixed by the State Government in respect of Thoubal Multipurpose Project and as a result of which, the then District Judge, Manipur West vide Order dated 29-09-1997 passed in O.S. (LA) No. 1 of 1996 allowed to pay the said compensation amount and subsequently, the Honble High Court vide orders dated 23-2-1999 and dated 24-2-1999 too allowed and confirmed the order of the District Judge, Manipur West in the First Appeal No. 1 of 1997 and M.A. (F) No. 4 of 1998 respectively. I have also gone through the order dated 29-09-1997 passed in O.S. (LA) No. 1 of 1996 by the then District Judge, Manipur West.

14. The Chandel District is located in between the said two districts, i.e. Thoubal District and Churachandpur District. On examining the said orders, it is crystal clear that the rate of compensation for acquiring lands for Thoubal Multipurpose Project as well as Khuga Dam Project were fixed as:

1. Agricultural land - Rs. 1,00,000/- per acre.

2. Ingkhol/Homestead land - Rs. 50,000/- per acre.

3. Forest/ Jhum land - Rs. 25,000/- per acre.

The Collector, L.A. Chandel has also fixed the rate of compensation for the acquired land at Modi Village, Chandel on the basis of the said rates. I have fully aware that the rates approved by the Government for Thoubal Multipurpose Project was fixed in the year, 1993 and the same rates was also given to the affected land owners of Khuga Dam Project, Churachandpur was in the year, 1999 and on the other hand, the said rate given to the claimant(s) of this reference was fixed in the year, 2007. Nevertheless, I find no document to show any change of rate of compensation between the said periods from the year, 1993 to 2007. The claimant has filed a Govt. Orders No. 2/1/SR/2007-COm(rEV) DATED 20-03-2012 regarding Minimum Guidance for Value of land, in which the rate in Chandel DHQ is fixed at Rs. 50 per sq. ft., but that order was made on 20-03-2012 and therefore, it is not applicable in this land acquisition.

In the result of the foregoing observations, I come to the conclusion that the rate fixed by the Collector, L.A. Chandel for Agricultural/Cultivated Wet Land at Rs. 1,00,000/- per acre is reasonable and appropriate. However, the Collector, LA., Chandel has committed error in fixing different rates fixed for Agricultural/Cultivated Wet Lands and Homestead lands as per the ratios laid down by the Honble Supreme Court in Subh Ram & Ors. vs. State of Haryana & Anr. Reported in (2010) 1 SCC 444 [LQ/SC/2009/1935] and Order dated passed in L.A. Appeal No. 1 of 2010 of the High Court of Manipur, since the said Agricultural/Cultivated Wet lands and Homestead lands were acquired for the same purpose of establishment of Head Quarters of 26th Sector of 24 Assam Rifles. Therefore, the rate of compensation of the acquired homestead area be fixed at Rs. 1,00,000/- at par with rate fixed for Agricultural/Cultivated Wet lands. However, I am of the opinion that it will not be proper to fix the rate of compensation of the Jhum/Terrace area at par with the Agricultural/Cultivated Wet lands/Homestead lands because, Jhum/Terrace area in the Hill area is almost in the slope portions and the areas covered by Agricultural/Cultivated Wet lands/Homestead lands are somewhat plain portion even in the Hill areas. However, I do feel that fixing the rate of compensation at Rs. 25,000/- per acre for Jhum/Terrace area comparing with the rate fixed for Agricultural/Cultivated Wet lands/Homestead lands is very low and therefore, I am of the opinion that fixing the rate of compensation amount at Rs. 50,000/- for Jhum/ Terrace area is more reasonable and appropriate. Therefore, the rate of compensation amount fixed by the Collector, L.A. Chandel for Jhum/ Terrace area at Rs. 25,000/- is enhanced at Rs. 50,000/-.Furthermore, as per section 23(2) L.A. Act, 1894, 30% Solatium of the compensation amount is also entitled to the claimant."

8. The claim was also made in relation to compensation for trees but the award was silent on that aspect, but in their application under section 18 which has already been extracted above, a specific mention has been made seeking compensation for trees, and the Collector, while referring the matter to the reference Court, has also impressed upon the reference Court to deal with the issue relating to compensation for trees, and that was considered by the reference Court in the following manner :-

"15. The next question to be considered is as to whether the claimant is entitled compensation for loss of standing trees/plants. P.W. No. 5 is a Forester in the Department of Forest, Govt. of Manipur and he deposed that as deputed by the then DFO, Tegnoupal Forest Division on the basis of a letter dated 19-05-2007 of the D.C. /Collector, L.A. , Chandel District, conducted in his official capacity assessed the value of the standing properties/plants in the acquired land and the value of the trees and plants in total come to Rs. 8,13,750 and his report is exhibited as Ext. A/12. I have gone through minutely Ext. A/12 and find that the report of P.W. No. 5 regarding the value of standing trees/plants is in respect of 310 acres of land. It is pertinent to mention here that at first the Government proposed to acquire 310 acres of land but later on, the area acquired was only 150 acres. Thus, the assessment made by P.W. No. 4 is to be calculated for the area of 150 acre only i.e. is little bit less than half of the entire assessed portionand fixed the value of compensation amount for the loss of trees/plants at Rs. 4,00,000/-(Rupees four lakhs) and the claimant is also entitled the said Rs. 4,00,000/-"

As a result, the reference Court passed the following order:-

"16. Issue No. 4

Issue No. 4 relates to the reliefs claimed by the claimant. In view of the findings and decisions made in Issue Nos. 1, 2 and 3, I come to the conclusion that the claimant is entitled to the reliefs claimed partly.

Order

The respondents are therefore directed:

i) to enhance the rate of compensation of Homestead land at Rs. 1,00,000/- acre at par with the rate fixed for Agricultural/Cultivated wet land;

ii) to enhance the rate fixed for Jhum/Terrace land at Rs. 50,000/- from Rs. 25,000/-

iii) 30% solatium of the compensation amount be paid to the claimant;

iv) Rs. 4,00,000/- (Rupees four Lakhs) only be paid to the claimant for loss of standing trees/plants;

v) To pay interest at the rate 6% per annum to the enhance amount under section 28 of the Land Acquisition Act, 1894 till the payment of enhanced compensation amount."

9. Mr. S. Samarjeet, learned CGC for the Union of India challenges this order in the following manner.

(i) There is no data sale deed even as per the evidence of witnesses. Therefore, enhancement of the compensation by the reference Court is bad.

(ii) No deduction has been made towards development costs.

(iii) There are no standing trees and therefore, compensation should not have been granted for the trees.

(iv) The respondent has not locus standi to plead for compensation.

10. The first issue raised by Mr. Samarjeet, deserves to be rejected at the outset because even as per the award, the collector has made the reference to the value of land per acre which is in confirmity with the Government order of 1993 which is referred to by the reference Court in para 13 & 14. By no stage of imagination, the value of land can be reduced from Rs. 1 lakh per acre after a period of 12 years. Even in the award, no justifiable reason has been given to reduce the value of the land. On the contrary, the finding of the reference Court is based on a Government stand based on the assessment by a High level committee which is followed in a similar case of acquisition prior to the present one.

11. This Court finds no serious error in the reference Court, adopting the same parameters because there is no material placed by the appellant to come to a different conclusion on the value of land. There is no data sale deed and it is admitted by both sides. The value fixed by the High level committee is not faulted. That value of the year 1993 has been the bench mark for the said locality. The reference Court was justified in relying upon Government value for the purpose of determination of the quantum of compensation. In fact the reference Court has taken the 1993 and subsequent years valuation for an acquisition of the year 2005.As a result, this Court does not find any error in the reference court enhancing the compensation based on proper and relevant parameters keeping in mind the fixation of land cost by the Government itself in the year 1993 of which there is a reference by the collector while passing the award itself. Therefore, the reference Court judgment stands confirmed.

12. The next plea for deduction towards development charge is also not tenable because the decision relied upon by Mr. Samarjeet, learned CGC in the case of Subh Ram and Others vs. State of Haryana and Another reported in (2010) 1 SCC 444 [LQ/SC/2009/1935] , made a distinction in so far as present land is concerned, pragraph 31 & 32 may be referred to for better clarity.

31. The legal position is therefore clear and well settled. But in Atma Singh: (2008) 2 SCC 568 [LQ/SC/2007/1495] , after reiterating the said principle regarding deduction of development cost, this Court made an observation that no deduction need be made having regard to the purpose of acquisition, which requires to be clarified. We extract the relevant portion below: (SCC pp. 576-77, para 15)

"15. The question to be considered is whether in the present case those factors exist which warrant a deduction by way of allowance from the price exhibited by the exemplars of small plots which have been filed by the parties. The land has not been acquired for a Housing Colony or Government Office or an Institution. The land has been acquired for setting up a sugar factory. The factory would produce goods worth many crores in a year. A sugar factory apart from producing sugar also produces many by-products in the same process. One of the by-products is molasses, which is produced in huge quantity. Earlier, it had no utility and its disposal used to be a big problem. But now molasses is used for production of alcohol and ethanol which yield lot of revenue. Another byproduct begasse is now used for generation of power and press mud is utilized in manure. Therefore, the profit from a sugar factory is substantial. Moreover, it is not confined to one year but will accrue every year so long as the factory runs. A housing board does not run on business lines. Once plots are carved out after acquisition of land and are sold to public, there is no scope for earning any money in future. An industry established on acquired land, if run efficiently, earns money or makes profit every year. The return from the land acquired for the purpose of Housing Colony, or Offices, or Institution cannot even remotely be compared with the land which has been acquired for the purpose of setting up a factory or industry. After all the factory cannot be set up without land and if such land is giving substantial return, there is no justification for making any deduction from the price exhibited by the exemplars even if they are of small plots. It is possible that a part of the acquired land might be used for construction of residential colony for the staff working in the factory. Nevertheless where the remaining part of the acquired land is contributing to production of goods yielding good profit, it would not be proper to make a deduction in the price of land shown by the exemplars of small plots as the reasons for doing so assigned in various decisions of this Court are not applicable in the case under consideration."

32. The above observations in Atma Singh (2008) 2 SCC 568 [LQ/SC/2007/1495] no doubt seem to suggest that where the acquisition is for a residential lay out, deduction towards development cost is a must, but if the acquisition is for an industry which does not require forming a layout of sites, the market value of small residential plots may be adopted without any cuts towards development cost. The said observations are made with reference to the special facts of that case. If they are read out of context to support a contention that the purpose of acquisition is a relevant factor to avoid the deduction of development cost in valuation, it may then be necessary to consider the said observations as having been made per incuriam, as they overlook a mandatory statutory provision - section 24 (clause fifthly) of the Act and the series of decisions of larger benches of this Court which hold that when value of large tracts of undeveloped lands is sought to be determined with reference to small residential plots in developed area, it is mandatory to deduct an appropriate percentage towards development cost. But it may be unnecessary to consider whether the observations are per incuriam as para 15 of the decision makes it clear that what is stated therein, is with reference to the special facts of that case, with a view not to disturb the smaller deduction of 10% by the High Court, and not intended to be statement of law."

Keeping that said principal in mind, it is apparent that the nature of acquisition does not attract development charges as a component for deduction. This plea is rejected.

Accordingly, this contention also stands rejected.

13. The next contention is relating to compensation for trees which is a part of the land acquired. The reference Court has taken into consideration the evidence of P.W. No. 5, Forester, Department of Forest, Government of Manipur, where he has clearly given the details of standing trees and the report which has been referred to by the reference Court shows that reference Court has also taken into consideration the extent of land acquired and the correspondingly reduce the value of trees. It is a discretion exercised by the reference Court on the basis of evidence on record. Nothing serious has been shown to the effect that the report of the Forester, Department of Forest, Government of Manipur, is patently erroneous or bad, therefore, the finding of the reference Court determining compensation for trees which has been validly raised before the reference Court is confirmed and this plea of the appellant is rejected.

14. As far as the locus standi is concerned, since the appellant have not produced the 4 (1) notification to substantiate plea of locus standi. Admittedly, the name of the respondent finds place both in the award as well as in the petition filed under section 18 of the Land Acquisition Act, 1894, before the reference Court. There is no reason to accept this contention. Accordingly, the same is rejected.

15. In the result, finding no merits the appeal is dismissed.