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Advocates
  • Amarendra Nath Gupta
  • Sushil Kumar Banerjee
  • Provash Chandra Basu
  • P.B.Chatterji
Judges
  • Arun K. Mukherjea
  • M.M Dutt, JJ.
Acts
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Citation Codes
Equivalent Citations
citation codes
Case Number
Advocates
  • Amarendra Nath Gupta
  • Sushil Kumar Banerjee
  • Provash Chandra Basu
  • P.B.Chatterji
Judges
  • Arun K. Mukherjea
  • M.M Dutt, JJ.
Acts
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Smart Summary

Structured Summary of the Opinion delivered by M.M. Dutt, J.

Factual and Procedural Background

This appeal was preferred by the referring claimant against an award made by the Calcutta Improvement Tribunal (the "Tribunal"). The original referring claimant died while the appeal was pending and his heirs and legal representatives were substituted as appellants.

The subject-matter is Premises No. 32 Bagmari Lane, an acquired property. Although numbered 32 Bagmari Lane, no part of the property fronts Bagmari Lane; its frontage is on a 16-feet-wide common passage to its south which meets Bagmari Lane to the east. Contiguous premises include No. 33 to the west and Nos. 29, 30 and 31 to the east.

The Collector assessed the market value of Premises No. 32 at Rs. 1,400 per cottah and awarded Rs. 19,718.61 as compensation, without allowing the 15% solatium (by reason of an amendment to the Calcutta Improvement Act in 1955). The claimant sought a reference under Section 18 of the Land Acquisition Act claiming Rs. 4,500 per cottah and statutory 15% allowance.

Before the Tribunal, both parties relied on expert evidence and on prior awards/decisions concerning adjacent acquired lands, notably Premises No. 33 (which included tank and solid land) and the Tribunal valued and adjusted rates using comparisons to those other premises. The Tribunal treated Premises No. 33 as a comparable unit in assessing the value of Premises No. 32 and made a series of percentage adjustments. The Tribunal allowed an increase over the Collector's award (including 15% statutory allowance and Rs. 500 under Section 48-A).

This Court (single bench) considered the appeal and modified the Tribunal's valuation methodology and outcome, setting out the appropriate percentage increase to apply to the Collector's average rate for Premises No. 33 and specifying resulting entitlements (market value, 15% under s.23(2), Rs. 500 under s.48-A, and interest).

Legal Issues Presented

  1. Whether the Tribunal correctly treated the rate it adopted for the comparable Premises No. 33 as a basic (front-belt) rate rather than an average rate, and whether it permissibly relied on observations in other reference judgments to infer the Collector's underlying method of valuation.
  2. Whether an unaccepted award of the Collector in one land acquisition proceeding is admissible and/or binding as evidence of market value in a different land acquisition proceeding (and, relatedly, whether the government or a claimant may rely on such unaccepted awards).
  3. Whether the percentage adjustments made by the Tribunal (an increase of 11.20% for disadvantages, deductions/additions for largeness or nearness) were legally and factually justified, and what final percentage adjustment should be applied to the Collector's average rate for Premises No. 33 to fix the market value of Premises No. 32.
  4. What ancillary relief (statutory solatium under Section 23(2), compensation under Section 48-A, and interest) the appellants are entitled to given the modified valuation.

Arguments of the Parties

Appellants' Arguments

  • The referring claimant (appellant) claimed market value for Premises No. 32 at Rs. 4,500 per cottah and sought the statutory 15% allowance.
  • The appellant relied on expert evidence (D.C. Banerjee). That expert identified five specific disadvantages of Premises No. 33 relative to Premises No. 32 and claimed an addition of 25% and a further Rs. 55 per cottah for nearness to Bagmari Lane; the Tribunal accepted a lesser addition (11.20%).
  • The appellant relied upon the Collector's award for Premises No. 33 (which yielded an admitted average rate of Rs. 1,343 per cottah) as relevant evidence for fixing the value of Premises No. 32.

Respondent's Arguments

  • Counsel for the respondent (Mr. Chatterjee) contended that it appeared from the Collector's reasons in the reference proceeding relating to Premises No. 33 that the Collector had taken a basic value of Rs. 1,400 per cottah, and therefore the Tribunal was justified in considering that basic rate (as opposed to an average rate).
  • Mr. Gupta (for the respondent) submitted that the Tribunal acted arbitrarily in granting only an 11.20% increase for the disadvantages of Premises No. 33.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Secy of State for India v. Nagendra Kumar Bose, (1938) 42 Cal WN 27 That an accepted award is good evidence of the Collector's valuation and may be relied on without examining the accepting owner in the other context The Court observed that the cited authority is sound in its context but distinguished it: the Nagendra Kumar Bose observation arose in a different factual context (accepted award relied on by Government) and therefore did not apply to the present situation involving an unaccepted award relied on by a claimant.
Ezra v. Secy of State, (1903) ILR 30 Cal 36 That the Collector acts as the agent of the Government in enquiry and valuation (i.e., an award is an offer of compensation on behalf of the Government) The Court applied this principle to explain that an unaccepted award is an offer by Government and is not binding as representing market value unless accepted or upheld; however, a claimant in a different proceeding may rely upon such an unaccepted award as evidence of market value, preventing the Government from later denying it represented market value.

Court's Reasoning and Analysis

The Court proceeded step-by-step, adhering closely to the evidence in the record and to legal principle:

  1. The Court examined what the Collector's award for Premises No. 33 (Ext. 1) actually showed. The award itself indicated a valuation of the solid land of Premises No. 33 at Rs. 1,343 per cottah, and that rate was treated by counsel on both sides as an average rate. The Court emphasized that the award (the documentary record) is the primary evidence, not subsequent reasons given by the Collector in reference proceedings.
  2. The Court rejected the respondent's submission that one may look to the Collector's reasons in the reference proceeding (or to dicta in the Tribunal's decision on a different premises) to convert or recharacterize the award's rate (i.e., to treat Rs. 1,400 as a basic/front-belt rate). The Court held that observations in judgments relating to other parcels are not evidence of what the Collector actually valued in the award under consideration.
  3. On admissibility and weight of unaccepted awards: relying on Ezra, the Court explained that a Collector's award is an offer of compensation by the Government; an unaccepted award is not definitive proof of market value for the Government's purposes in another proceeding (because it is only an offer), but a claimant in a different proceeding may rely on such an unaccepted award as evidence of market value. Thus the appellant could properly rely on the Collector's award for Premises No. 33.
  4. The Tribunal's reliance on observations in the judgment about Premises No. 29 (to infer that the rate applied to Premises No. 33 was a basic/front-belt rate) was held to be improper: the Tribunal had no admissible evidence showing that Premises No. 33 had been valued by a belting method, and the earlier Tribunal judgment had itself been set aside by this Court in other appeals—so it could not be used as evidence.
  5. The only relevant evidence for the comparable was the Collector's award showing Rs. 1,343 per cottah as the average rate for Premises No. 33. The Tribunal had increased that rate by 11.20% to account for disadvantages (based on the appellant's expert D.C. Banerjee). The Court treated the Tribunal's 11.20% allowance as a factual finding based on expert evidence and, given the limited scope of the appeal, declined to disturb that factual finding.
  6. The Court identified an error in the Tribunal's treatment of size-related adjustments: the Tribunal had deducted 2.5% for largeness of Premises No. 32 and added 2.5% for nearness to Bagmari Lane, resulting in a net zero effect. The Court found that the deduction for largeness was erroneous because Premises No. 32 was demonstrably smaller than Premises No. 33 (the comparator) and therefore should not have been disadvantaged for largeness. The Court held that Premises No. 32, being smaller, is likely to fetch a greater value and therefore additional percentage allowances should be applied in its favour.
  7. On the basis of the Tribunal's findings and the record, the Court determined that an additional 5% should be allowed for the smallness of area and a further 2.5% should be allowed for nearness to Bagmari Lane. Notwithstanding the intermediate textual discussion, the Court expressly stated the resulting total percentage increase to be applied to the Collector's average rate of Rs. 1,343 per cottah is 16.20% (i.e., the Tribunal's 11.20% plus an additional 5% results, according to the Court's language, in a total of 16.20%).
  8. The Court therefore modified the Tribunal's judgment and award to determine the market value of Premises No. 32 at the average rate of Rs. 1,343 per cottah plus 16.20% of that rate per cottah, and delineated the consequential statutory entitlements and payment terms (see Holding and Implications).

Holding and Implications

APPEAL PARTLY ALLOWED

Holding (direct effect on the parties):

  • The Court modified the Tribunal's valuation and held that the market value of the land of Premises No. 32 is to be determined at the average rate of Rs. 1,343 per cottah plus 16.20% of that rate per cottah.
  • The appellants (heirs of the original claimant) are entitled to compensation calculated at that rate.
  • In addition to that market value, the appellants are entitled to 15% on such market value under Section 23(2) of the Land Acquisition Act, 1894.
  • The appellants are entitled to Rs. 500 under Section 48-A of the Land Acquisition Act as compensation for delay in making the award.
  • Interest at the rate of 6% per annum shall be paid on the amount of compensation in excess of the amount awarded by the Collector, from the date the Collector took possession of the acquired premises until payment of the same into the Tribunal.
  • The payment of the enhanced amount (as modified) shall be made by the Collector within three months from the date of communication of the award to him.
  • The appeal was allowed in part and with costs; Justice Arun K. Mukherjea concurred.

Implications beyond the parties: The Court applied established principles about the evidential status of Collector's awards and the limited admissibility of observations in other proceedings; the decision clarifies that an unaccepted Collector's award may be relied upon by a claimant in a separate proceeding as evidence of market value, while the Government cannot treat an unaccepted award as conclusive proof of market value. The opinion does not purport to establish a broader new precedent beyond its application of these principles to the facts before the Court.

This summary is confined strictly to matters stated in the provided opinion and does not include information or inferences beyond that text.

Show full summary ...

    Sm. Pratima Ghosh And Others v. The State Of West Bengal .

    The Judgment of the Court was delivered by

    M.M Dutt, J.:— This appeal was preferred by the referring claimant against the award of the Calcutta Improvement Tribunal (hereinafter referred to as the Tribunal). The referring claimant having died during the pendency of the appeal his heirs and legal representatives were substituted in his place and they are the present appellants before us.

    2. Premises No. 32 Bagmari Lane is the acquired property and is the subject-matter of this appeal. On the contiguous west of premises No. 32. is the premises No. 33. Bagmari Lane. Premises Nos. 29. 30 and 31. Bagmari Lane are situate on the contiguous east of Premises No. 32. Although, the acquired property is numbered as 32. Bagmari Lane, no part of it is situate on the Bagmari Lane. On the South of this premises there is a 16 feet wide common passage running East West and the frontage of the premises is on this common passage. The common passage meets the Bagmari Lane on the East. Premises No. 33 also has its frontage on the common passage, but the other three premises, namely, premises Nos. 29, 30 and 31 have their respective frontages on the Bagmari Lane. It is thus apparent that between premises No. 32 and the Bagmari Lane, those three premises are situate and consequently, premises No. 32 is some distance away from Bagmari Lane.

    3. The Collector determined the market value of premises No. 32 at Rs. 1,400/- per cottah and awarded a sum of Rs. 19,718.61 as compensation at the said rate. The Collector did not allow the solatium of 15 per cent, on the market value in view of the subsequent amendment of the Calcutta Improvement Act in 1955.

    4. Being aggrieved by the award of the Collector, the referring claimant made an application for reference under Section 18 of the Land Acquisition Act claiming the market value of the acquired land at the rate of Rs. 4,500/- per cottah and also claimed the statutory allowance of 15 per cent, on the total amount of the market value.

    5. It may be stated at this stage, that premises Nos. 33 and 29 Bagmari Lane, were also acquired by the Calcutta Improvement Trust. Before the Tribunal both parties examined their respective experts and both the experts relied on the judgments of the Tribunal passed in reference proceedings against the awards of the Collector in respect of premises Nos. 29 & 33. Premises No. 33 consists of a tank measuring 17 cottah 8 chattaks 15 sq. ft. which is only a portion of the tank and solid land measuring 12 cottah 6 chattaks 31 sq. ft. It is not disputed that tank land is treated as half of solid land and on this basis the area of solid land comprised in premises No. 33 will be 21.18 cotta. It is also not disputed that in view of the total market value that was assessed by the Collector in respect of solid land of premises No. 33, namely. Rs. 28,414.62. the average rate of market value per cottah comes to Rs. 1343/-.

    6. As premises No. 33 was situate on the contiguous West of premises No. 32 and had its frontage on the common passage, the former was taken to be the comperable unit in determining the market value of the latter. It appears that the Tribunal proceeded on the footing that the Collector took into his consideration the basic rate i.e, the front belt value of land of premises No. 29, Bagmari Lane which was found in the award in respect of that premises as Rs, 2,200/-. By deducting 36 per cent from the basic rate of Rs. 2,200/- on account of unsuitability of the land of premises No. 33 for building or factory sites, its low leval and water-logged nature, and the position of the tank and on further deduction of 5 per cent, for largeness of area, the Collector deduced the basic rate of premises No. 33 as Rupees, 400/- per cottah.

    7. The basic rate in respect of the land of premises No. 29 was enhanced by the Tribunal from Rs. 2,200/- to Rs. 2,327/- in the reference proceeding from the award of the Collector. In the instant case, the Tribunal took the view that as the basic rate of premises No. 33 was determined on the basis of the basic rate of premises No. 29 and as the basic rate of the latter was enhanced from Rs. 2,200/- to Rs. 2,327/- in the reference proceeding, the proportionately enhanced basic rate of premises No. 33 which comes to Rs. 1,489/- per cottah. should be taken into account for the purpose of determining the market value of premises No. 32.

    8. The Tribunal accepted the evidence of the appellant's expert D.C Banerjee that there were five items of disadvantages of premises No. 33 as compared with premises No. 32. The disadvantages of premises No. 33 as found by the Tribunal are as follows:— (1) the Western boundary runs across the tank: (II) low level of portions of the premises; (III) irregular shape of solid land; (IV) greater distance of the premises from Bagmari Lane; (V) low level of the common passage in front of the premises.

    9. For the aforesaid disadvantages found by the Tribunal in respect of premises No. 33, the expert D.C Baneriee claimed an addition of 25 per cent, and a further sum of Rs. 55/- per cottah on the ground of nearness of premises No. 32 from Bagmari Lane. The Tribunal held that in determining the market value of premises No. 32 there should be an addition of 11.20% on Rs. 1,489/- which was calculated to be the basic rate of premises No. 33. In that view of the matter the Tribunal increased the raid basic rate of Rupees 1,489/- per cottah by Rs. 166.79 which comes to Rs. 1,655.79. The Tribunal, however, took the round figure of Rupees 1,656/-.

    10. Before the Tribunal it was contended on behalf of the appellant that the rate of Rs. 1,656/- per cotta should be taken as the average rate for the purpose of valuing the land of premises No. 32. In support of the said contention it was pointed put to the Tribunal that the Collector in valuing the said land of premises No. 33. took Rupees 1,400/- as the average rate and not the basic rate and that the same was confirmed by the Tribunal in the reference proceeding from the award of the Collector inasmuch as. the reference proceeding was ultimately dismissed. In repelling the contention, the Tribunal referred to an observation in the judgment of the Tribunal relating to premises No. 29 which, according to the Tribunal showed that the rate was not the average rate but basic rate i.e, the front belt rate.

    11. For the reasons aforesaid, the Tribunal came to the conclusion that the premises No. 32 should be valued at the rate of Rs. 1,656/- per cotta as the bade rate and not as the average rate. Calculating the value of premises No. 32 at the basic rate of Rs. 1,656/- per cotta, the Tribunal enhanced the amount of compensation awarded by the Collector by Rs. 169.95 The Tribunal, however, allowed the statutory allowance of 15% on the market value. Further, a sum of Rs. 500/- was awarded under Section 48-A of the Land Acquisition Act.

    12. It may be stated here, that the judgment of the Tribunal in respect of premises No. 33 and two other premises. namely, premises Nos. 34 and 35 was set aside by this Court in F.A Nos. 227, 228 and 229 of 1957. This Court sent the cases back to the Tribunal for fresh consideration.

    13. In our view, the Tribunal proceeded in a round about way and that has created confusion and also complications. The award of the Collector in respect of premises No. 33 (Ext. 1) does not at all show that he took the basic value of solid land of premises No. 33 as Rs. 1,400/- per cotta. The only thing which appears from the award (Ext. 1) is that the solid land of premises No. 33 was valued at the rate of Rs. 1,343/- per cotta. This rate was admitted by the learned Advocates of both the parties as the average rate. Mr. Chatterjee, learned Advocate appearing on behalf of the respondent submitted that it would appear from the reasons given by the Collector in connection with the reference proceeding relating to premises No. 33 that he took the basic value at Rupees 1,400/- per cotta and that accordingly, the Tribunal was justified in taking the same into its consideration. We are unable to accept this contention of Mr. Chatterjee. for the simple reason that what is evidence is the award of the Collector and not the reasons given by him in connection with the reference proceeding in justification of his award.

    14. Mr. Chatterjee. however, contended that an unaccepted award could not be relied on as a piece of evidence for determining the market value of similar land. In support of his contention. Mr. Chatterjee placed reliance on a decision of this Court in Secy of State for India v. Nagendra Kumar Bose, (1938) 42 Cal WN 27. It was observed in that decision that an accepted award was undoubtedly as good evidence as any other award by the Collector made in a Land Acquisition Proceeding against which no reference was sought under Section 18 of the Land Acquisition Act, for determining the market value of land acquired. There can be no doubt about the soundness of the said observation, but in the Instant case it has no application. In that case, the accepted award was relied on on behalf of the Government and the question was whether the owner or the person interested who accepted the award should be examined or not It was held that it was not necessary as the accepted award was a good piece of evidence. That observation therefore was made in a different context.

    15. The Collector acts in the matter of the enauiry and the valuation as the agent of the Government (See Ezra v. Secy of State, (1903) ILR 30 Cal 36). Consequently, an award of the Collector is an offer of compensation made on behalf of the Government. The Government is bound by the offer but not the claimant, for, he can seek a reference to the Court from the award under Section 18. An award which has not been accepted by the owner or the person interested. cannot be relied on by the Government as evidence of market value of land in a different land acquisition proceeding for the simple reason that the award contains an unaccepted offer of compensation made on behalf of the Government. So long the award is not accepted by the owner or the person interested or so long it is not upheld by the Court in a reference proceeding, it cannot be said that the offer contained in the award is an offer of the market value of the acquired land. But a claimant in a different proceeding can very well rely on the unaccepted award as evidence of the market value and if the land be similar to the land in respect of which the award relied upon was made, the Government will be precluded from saying that the offer contained in the award does not represent the market value of the acquired land. There is, therefore, no force in the contention of Mr. Chatterjee that the award of the Collector in respect of premises No. 33 could not be relied on by the appellant for determining the market value of the land of premises No. 32. as the award was an unaccepted award.

    16. There is no indication In the judgment of the Tribunal in the reference proceeding in respect of premises No. 33 whether the valuation was made by belting method or not. In our view, the Tribunal committed an error of law in relying on the observations made in the decision of the Tribunal relating to premises No. 29 for the purpose of showing that although the reference case was dismissed by the Tribunal in respect of premises No. 33. the Tribunal had in its mind the front belt rate or the basic rate. The observations made by the Tribunal regarding the rate of valuation of premises No. 33 in a different proceeding, is not evidence. It has been seen that there was nothing in the judgment of the Tribunal in respect of premises No. 33 that the premises was valued by the belating method. It is not permissible for the Tribunal to rely on a mere observation in the judgment in respect of premises No. 29 so as to ascertain what was in the mind of the Tribunal when it decided the reference case relating to premises No. 33. Further, the judgment of the Tribunal in respect of premises No. 33 having been set aside by this Court, it is no longer evidence and cannot be referred to.

    17. For the reasons aforesaid, the only evidence which is relevant is the award of the Collector regarding premises No. 33. It has been already stated that premises No. 33 was valued by the Collector at the average rate of Rupees 1,343/- per cotta. As found by the Tribunal the average rate of Rs. 1,343/- has to be increased by 11.20 per cent in view of the disadvantages of premises No. 33. Mr. Gupta, however, submitted, that in granting an increase of only 11.20 per cent, for the disadvantages, the Tribunal acted arbitrarily. In coming to the finding that an allowance of 11.20 per cent, should be given for these disadvantages, the Tribunal relied on the evidence of the appellant's expert D.C Banerjee. Even if we do not agree with the reasons given by the Tribunal regarding the percentage which should be allowed for the disadvantages, we cannot set aside the finding of the Tribunal which we consider to be a finding of fact, in view of the limited scope of the appeal.

    18. The Tribunal was of the view that there should be deduction of 2½ per cent, for the largeness of premises No. 32 and that 2½ per cent, should be added for the nearness of premises No. 32 from Bagmari Lane. The result of the deduction and addition was nil as the percentage was the same in both the oases. In coming to the said finding the Tribunal relied on the evidence of the experts of the parties. So far as the question of deduction on the ground of largeness of area of premises No. 32 is concerned, it is apparent that the Tribunal has committed an error. The area of solid land of premises No. 32 is smaller than the area of solid land of premises No. 33. It was argued that as premises No. 33 was larger in area than premises No. 29, a deduction of 5 per cent, was made from the valuation rate of premises No. 29 for the purpose of determining the market value of premises No. 33. The award of the Collector regarding premises No. 33 does not show that any such deduction was made. We have already held that the reasons given by the Collector in connection with the reference case cannot be looked into as evidence. Apart from that, the market value of premises No. 32 is being determined on the basis of the valuation of premises No. 33 and not of premises No. 29. We are. therefore, of the view that the Tribunal committed an error of law in making a deduction of per cent, for the alleged largeness of area of premises No. 32.

    19. Premises No. 32 is smaller in area than premises No. 33 and the size and shape of the former are more or less uniform, but the size and shape of the latter are irregular. It is apparent from the key plan that the premises No. 32 is much better in every respect than premises No. 33. Premises No. 32 being smaller in area than premises No. 33. will undoubtedly fetch greater value than premises No. 33.

    20. This aspect has not been considered by the Tribunal. We are of the view that a further 5 per cent, should be allowed i.e per cent for the smallness of area and another 2½% for the nearness of premises No. 32 from Bagmari Lane. The Tribunal has allowed 11.20 per cent, for the disadvantages and to this a further 5 per cent should be added, so that the total percentage by which the average rate of Rs. 1,343/- per cotta should be increased for fixing the market value of premises No. 32 comes to 16.20

    21. In the result, the judgment and award of the Tribunal are modified as follows:—

    The market value of the land of premises No. 32 is determined at the average rate of Rs. 1,343/- plus 16.20 per cent, of that rate per cotta. The appellants shall be entitled to compensation at that rate.

    In addition to the market value calculated at the above rate, the appellants shall be entitled to a sum of 15 per cent, on such market value under Section 23(2) of the Land Acquisition Act. 1894. The appellants shall also get a sum of Rupees 500/- only as compensation for the damage suffered by them for the delay in making the award, under Section 48-A of the Land Acquisition Act.

    The amount of compensation in excess of the amount awarded by the Collector shall bear interest at the rate of six per cent, per annum from the date the Collector took possession of the acquired premises No. 32 till payment of the same into the Tribunal.

    The payment of the enhanced amount shall be made by the Collector within three months from the date of communication of the award to him.

    22. The appeal is allowed in part with cost.

    23. Arun K. Mukherjea, J.:— I agree.

    24. Appeal partly allowed.

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    Sm. Pratima Ghosh And Others v. The State Of West Bengal .
    (Sep 13, 1971)