The Judgment of the Court was as follows:—

Mukherjea, J.:— This is a Rule obtained by the Province of Bengal and is directed against an award of the Calcutta Improvement Tribunal passed in Valuation Case No. 7 of 1937. As the value of the award is below 5000 and the tribunal refused a certificate under sec. 3, sub-sec. (1)(b) of the Calcutta Improvement Appeals Act, the Petitioner has come up on a petition of revision to this Court under sec. 115, C.P Code.

The material facts necessary for our present purposes may be shortly stated as follows: Premises No. 20, Baburam Ghosh Lane was acquired in connection with Street Scheme No. 44 of the Calcutta Improvement Trust and the Opposite Parties who were the owners of the said premises were allowed a sum of Rs. 3,670 by the Collector as compensation both for the land and the building.

The claimants being dissatisfied prayed for a reference under sec. 18, Land Acquisition Act and the Calcutta Improvement Tribunal, to which reference was made, increased the valuation from Rs. 3,670 to Rs. 5,400. The claimants in support of their claim for increased valuation, before the Tribunal, relied, inter alia, on an award and also on what was said to be a supplementary award, regarding premises No. 21, Baburam Ghosh Lane which was a contiguous property and was acquired some time before. They also examined Mr. Nagendra Nath Ganguly as an expert on their side. The Tribunal held that the “supplementary” award in connection with Premises No. 21, Baburam Ghosh Lane which was marked Ex. (8) in the case was something which was beyond the powers of the Collector to make under the provisions of the Land Acquisition Act. It was a thing which had no existence in the eye of law and the Court was consequently not justified in looking into it for purposes of the case.

As the valuation made by Nagendra Nath Ganguly on the land and building method was based mainly upon the supplementary award, his evidence on this point was rejected in its entirety.

The point which has been attempted to be made on behalf of the Province of Bengal is that the Tribunal in discarding the document mentioned above exercised its jurisdiction illegally and with material irregularity and this error vitiated the whole award.

It appears from the records that in connection with the acquisition of premises No. 21, Baburam Ghosh Lane, there was an award made by the Collector under sec. 11, Land Acquisition Act in January, 1936 and a sum of Rs. 1,650 was allowed as compensation to the claimant both for the land and the building.

There was a reference to the Tribunal under sec. 18, Land Acquisition Act at the instance of the claimants who were dissatisfied with the award. Pending the hearing of the reference, there was a talk of settlement between the interested parties and the acquiring authority through the Collector and in the event, the parties agreed that on payment of an additional sum of Rs. 700 as compensation, the claimants would withdraw their reference. The reference was withdrawn and the additional sum was paid by the Collector on 1-10-37. No supplementary or separate award was made but the Collector recorded the result of the compromise and included the additional sum paid, in a revised award statement in form (A), Appendix (7) to the Civil Accounts Code, which was forwarded to the Accountant General, Bengal. This was done in accordance with the instructions contained in a letter addressed by the Government to the Land Acquisition Collector, dated the 20th of August, 1916. I agree with the Tribunal that no additional or supplementary award could be made by the Collector under sec. 11, Land Acquisition Act. Under paragraph 63 of the Executive Instructions issued by the Government of Bengal the Collector, after he has made his award, is not competent to amend it or make a supplementary award, except in cases of clerical errors or other mistakes or omissions apparent on the face of the records. Ex. (8) is however not a supplementary award and it does not purport to be so; it is not an award at all but an award statement which is forwarded for purposes of accounts to the Accountant General, Bengal, under form (A), Appendix (7) to the Civil Accounts Code mentioned above. For an award there is a different form prescribed, viz., form No. (13). (Vide paragraph 60 of the Executive Instruction). Ex. (8) therefore is nothing but a record of the compromise that was subsequently arrived at between the Collector and the claimants and it shows that the latter accepted a sum of Rs. 700 in addition to the sum of Rs. 3,650 mentioned in the award, as price for the land and the building. Though the Collector cannot make a supplementary award, I do not think that he is in any way incompetent to enter into a com promise with the claimants who have got a reference under sec. 13, Land Acquisition Act and pay them a sum of money on the basis of such settlement on condition of their withdrawing the reference. Such compromise could certainly be made before the Tribunal and in my opinion, it does pot become illegal by being made out of Court. Sec. 31(4) of the Land Acquisition Act, though it deals with a different matter, would seem to suggest that the Collector has almost unfettered powers of entering into contracts with persons interested in the subject-matter of acquisition. In my opinion, therefore, the Tribunal was not right in ignoring Ex. (8) on the ground that it was a nullity in the eye of law. It was not an award, but-it certainly could be used as evidence of the fact, that subsequent to the award, the acquiring authority, agreed to pay amicably a sum of money in addition to that given by the award. What value could be attached, to such evidence would be for the Court to decide, having regard to the circumstances under which the compromise was arrived at, but it was a piece of evidence admissible in law, which has to be weighed and appraised by the Court.

But though the Tribunal was not right in rejecting the piece of evidence, I do not think that this irregularity has in any way affected the merits of the case.

As I have said already the so-called supplementary award was put in evidence not by the Government but by the claimants. The valuation made by Nagendra Nath Ganguly on the land and building method was discarded by the Court on the ground that he made the valuation mainly on the basis of this supplementary award. The rejection of Nagendra's evidence on this point, which was in favour of the claimants, could not be said to have prejudiced the Province of Bengal in any way.

Dr. Basak argues that, if the Court had accepted Ex. (8) it might not have rejected the land and building method of valuation and possibly would not have adopted the rental basis; and the first method would have been more advantageous to the Crown.

I am not at all convinced by this argument, Mr. Batabyal the expert for the Government and Mr. Ganguly the claimants' witness were practically of the same opinion, as regards the valuation of the land on the basis of price paid for premises No. 21, Baburam Ghosh Lane. Nay, the evidence of Mr. Batabyal was more in favour of the claimants as his valuation was slightly in excess of that made by Ganguly. Ex. (8) therefore could not have helped the Government as regards the valuation of the land. As regards the building Mr. Batabyal's estimate was undoubtedly less than that of Ganguly but so far as the building was concerned Ex. (8) would be altogether irrelevant and would afford no criterion for valuing the building on an adjacent plot. The tribunal rejected the valuation made by Mr. Batabyal on the land and building method and ultimately proceeded on the rental basis. I do not think that the Province of Bengal has been in any way prejudiced by the procedure adopted by the Tribunal and in my opinion, the Rule must stand discharged with costs. Hearing-fee, three gold mohurs.

Roxburgh, J.:— The Rule under consideration was issued at the instance of the Province of Bengal which desires to have set aside an order of the Calcutta Improvement Tribunal passed in respect of an award relating to premises No. 20, Baburam Ghosh Lane, mainly on the ground that the Tribunal had erroneously rejected some evidence relating to previous proceedings of the Collector in acquiring neighbouring premises No. 21, Baburam Ghosh Lane. The Tribunal had referred to those proceedings as a “supplementary award” and rejected the evidence in the following terms:—

“Therefore, the conclusion of the Tribunal is that the supplementary award of the revised award statement regarding 21, Baburam Ghosh Lace by which an additional sum was awarded has no existence in the eye of law and therefore the entire basis of Mr. Gesguly's valuation of the property in question on the land and building method falls to the ground.”

After hearing both parties it becomes apparent that the real grievance is not that the effect of the rejection of the evidence in this case has clearly and seriously prejudiced the Province but that the view expressed by the Tribunal on the procedure referred to as a “supplementary award” is wholly erroneous and that should the view gain currency it will throw doubts on transactions involving lakhs of rupees which have taken place in the past. The Province endeavoured to obtain a certificate from the President under sec. 3 of the Calcutta Improvement Appeals Act, 1911, in order to file an appeal to this Court, such a certificate being necessary as the amount in dispute is less than Rs. 5,000 but was unsuccessful, hence no appeal is possible.

The circumstances are sufficiently curious. The Mr. Ganguly referred to in the above-quoted portion of the Tribunal's order was a valuer put forward as a witness by the Opposite Parties before the Tribunal. He gave evidence as to valuation on the basis of the land and building method and also on the rental basis. In referring to the amount previously paid in respect of premises No. 21, Baburam Ghosh Lane (in the “supplementary award”), he calculated from the amount there paid that the value of land per cottah would be Rs. 2,533. However he actually valued the land at a slightly higher rate, namely, Rs. 2,600 per cottah and on that basis valued the premises No. 20, at Rs. 5,400. On the rental basis his valuation is Rs. 5,460. On the other hand Mr. Batabyal who gave evidence for the trust arrived at a valuation almost identical, vis., Rs. 2,550 per cottah taking into account the “supplementary award,” but his estimate in regard to the value of the buildings was less than that of Mr. Ganguly. Admittedly there is no connection between the respective valuations of the buildings on the two premises Nos. 20 and 21. His valuation on other grounds however was Rs. 2,000 per cottah and Rs. 4,000 for the whole. It is difficult thus to see how in any conceivable view the rejection, however erroneous, by the Tribunal of the evidence based on the amount paid for premises No. 21 which was put forward by the Opposite Party could in any way have prejudiced the Province. The Tribunal also discussed Mr. Batabyal's valuation, aliunde, on the land and building method and rejected it. It then fell back on the rental basis of calculation, but finally awarded Rs. 5,400 the exact figure contended for by Mr. Ganguly on the land and building basis, taking land at Rs. 2,600 per cottah while according to him the rate based on the amount paid for premises No. 21 would be slightly less, namely Rs. 2,533.

This is then sufficient to dispose of the Rule, but Dr. Basak appearing for the Province has earnestly pressed us to say something on the subject of the Tribunal's grounds of rejection and as in fact those grounds are so clearly erroneous and may do harm and as the matter has been canvassed at length before us, we give our reasons for holding that the proceedings of the Collector in regard to premises No. 21, Babu Ram Ghosh Lane were quite regular.

It appears that in connection with the acquisition of premises No. 21, Babu Ram Ghosh Lane the Collector had awarded Rs. 1,650 on the land and building basis. The owner had a reference made to the Tribunal under sec. 18 of the Land Acquisition Act and the Collector after consulting the Chairman of the Improvement Trust by a demi-official letter marked Ex. S. in the case ordered a further Rs. 700 to be paid in addition to the amount of the original award which amounted with the various extras to Rs. 1,925-8-8. These particulars are shown in an “award statement” which is marked as Ex. 8 in the present case. The amount of Rs. 700 is shown in red ink with a marginal entry:—

“The fignres in red ink indicate the additional amount to be paid on withdrawal of reference.”

This has been done in accordance with the procedure laid down in a letter dated the 20th August, 1916, from the Government of Bengal to the Land Acquisition Collector. It is not disputed that the Collector has no power to amend his award under sec. 11, or to make a supplementary award except in cases of clerical error, error of calculation or manifest omission to deal with a part of the claim made by an interested party; and this is pointed out in paragraph 63 of the Executive Instructions framed by Government and published in the Bengal Land Acquisition Manual. In his letter (Ex. S) to the Chairman of the Trust the Collector does loosely state that he will make a “supplementary award” but the Government letter of 1916 does not enjoin this nor in fact is this what was done by him. The letter in question expressly makes it clear that in these cases the award is not to be touched, but that the procedure is really one of compromise with the party which has required the reference and the Collector is empowered on behalf of Government to make the compromise; payment is to be made on compromise on withdrawal of the reference and in consideration of the withdrawal. The procedure laid down by the letter and actually followed in the case under consideration is in accordance with this nature of the proceeding, the extra amount paid is separately entered in red ink in the “award statement” (.Ex. 8) and a note is made in the remarks column to the effect already quoted above that the figures in red ink represent the amount to be paid on withdrawal of reference. The award statement is an entirely different paper from the award which is to be drawn up in form 13 as laid down by paragraph 60 of the Executive Instructions in the Bengal Land Acquisition Manual and the Tribunal appears to have overlooked this completely. The award statement is kept in form A prescribed in Appendix 7 of the Civil Accounts Code which is issued by the Auditor-General. It is an Accountant General's form and is prescribed for the purposes of audit. Art. 116 of the Code runs:—

“The procedure to be observed for the payment of compensation for land taken up for public purposes under the Land Acquisition Act of 1894, is regulated by the rules printed in Appendix 7.”

In Note 4 to the article it is provided that

“In the case of land acquired by the Public Works department by private negotiation, the officer who settles the price etc., should draw up form A prescribed in Appendix 7 and this should be made the basis of subsequent payment and audit.

Thus the award statement is to be used even in case of acquisition by private negotiation. Rules 15 and 16 in the appendix show clearly the purpose of the award statement form A; the Accountant-General is to check all payment to see that they are supported by vouchers and that the amount paid on the receipts is the amount payable under the award as shown by the award statement. He is to note the vouchers and payments in the appropriate column, also the dates of delivery of possession as he receives reports thereof and finally to send the form together with forms AA and B to the Chief Revenue Authority. (Form AA relates to acceptances by the persons concerned of the amounts entered in column 6 of the award statement and form B shows awards made by the Court under sec. 26 of the Act). “This will complete the audit of the Accountant-General” (Rule 16, Appendix 7 C.A.C). The instructions in the Government letter of 1916 are therefore entirely correct and it is necessary that any extra payment outside the award made in consideration of withdrawal of a reference should appear in the award statement so that the payment shall be authorised and so as to satisfy the auditor. It is entirely incorrect to say that an entry in the award statement of such an order for payment amounts to an amendment of the award itself.

It is evident that Government in acquiring land is at liberty to come to terms with an objector and can compromise a claim pending on reference in the same way as it or any other part may compromise any suit. But there is also express provision in the Land Acquisition Act for such procedure. Under sub-sec. (3) of sec. 31 of the Act notwithstanding anything in the section as to the procedure of the Collector on making an award under sec. 11, it is enacted that he may instead of awarding compensation in money make other arrangement with a person, having a limited interest in the land by grant of lands in exchange and the like and by sub-sec. U) it is further enacted that nothing in the previous sub-section shall limit the power of the Colector to enter into any arrangement with any person interested in the land and competent to contract in respect thereof.

The Tribunal therefore appears to have misconceived the nature of the proceedings it condemns as having “no existence in the eye of the law”; the proceedings were entirely legal and proper and in correct form.

It is unnecessary to examine the question whether, assuming that the proceedings in connection with premises No. 21 were not entirely in regular or legal form, this had any bearing on the admissibility of the evidence as to the transaction in favour of the Opposite Party here. It is evidence that a certain neighbour received a certain sum in compensation for acquisition of his land and building and the evidence would seem to be as admissible as that relating to any other transaction by which a transfer of title for value was made of neighbouring property. The admissibility of the evidence does not depend on the form of the transaction by which the amount was paid and accepted; its value may no doubt be affected by such considerations.

C.C