N THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 2545-2546/2012
MAJ. GEN. KAPIL MEHRA & ORS. ..Appellants
Versus
UNION OF INDIA & ANR. ..Respondents
10) While fixing the market value of
the acquired land, the Land Acquisition Officer is required to
keep in mind the following factors:- (i) existing geographical
situation of the land; (ii) existing use of the land; (iii) already
available advantages, like proximity to National or State
Highway or road and/or developed area and (iv) market value
of other land situated in the same locality/village/area or
adjacent or very near to the acquired land.
11. The standard method of determination of the
market value of any acquired land is by the valuer evaluating
the land on the date of valuation publication of notification
under Section 4(1) of the Act, acting as a hypothetical
purchaser willing to purchase the land in open market at the
prevailing price on that day, from a seller willing to sell such
land at a reasonable price. Thus, the market value is
determined with reference to the open market sale of
comparable land in the neighbourhood, by a willing seller to a
willing buyer, on or before the date of preliminary notification,
as that would give a fair indication of the market value.
In Viluben Jhalejar Contractor v. State of Gujarat
(2005) 4 SCC 789, this Court laid down the following
principles for determination of market value of the acquired
land: (SCC pp.796-97, paras 17-20)
“17. Section 23 of the Act specifies the matters
required to be considered in determining the
compensation; the principal among which is the
determination of the market value of the land on the
date of the publication of the notification under subsection
(1) of Section 4.
18. One of the principles for determination of the
amount of compensation for acquisition of land would
be the willingness of an informed buyer to offer the
price therefor. It is beyond any cavil that the price of
the land which a willing and informed buyer would
offer would be different in the cases where the owner is
in possession and enjoyment of the property and in
the cases where he is not.
19. Market value is ordinarily the price the property
may fetch in the open market if sold by a willing seller
unaffected by the special needs of a particular
purchase. Where definite material is not forthcoming
either in the shape of sales of similar lands in the
neighbourhood at or about the date of notification
under Section 4(1) or otherwise, other sale instances
as well as other evidences have to be considered.
20. The amount of compensation cannot be
ascertained with mathematical accuracy. A
comparable instance has to be identified having regard
to the proximity from time angle as well as proximity
from situation angle. For determining the market value
of the land under acquisition, suitable adjustment has
to be made having regard to various positive and
negative factors vis-à-vis the land under acquisition by
placing the two in juxtaposition.….
The courts adopt comparable sales method for
valuation of land while fixing the market value of the acquired
land. Comparable sales method of valuation is preferred rather
than methods of valuation of land such as capitalization of net
income method or expert opinion method, because it furnishes
the evidence for determination of the market value of the
acquired land at which the willing purchaser would pay for the
acquired land if it had been sold in the open market at the
time of issuance of notification under Section 4 of the Act.
2) In Karnataka Urban Water Supply and Drainage Board
and Ors. v. K.S. Gangadharappa & Anr., (2009) 11 SCC 164,
factors which merit consideration as comparable sales are,
interalia, laid down as under:-
“It can be broadly stated that the element of
speculation is reduced to minimum if the underlying
principles of fixation of market value with reference to
comparable sales are made:
(i) when sale is within a reasonable time of
the date of notification under Section
4(1);
(ii) It should be a bona fide transaction;
(iii) It should be of the land acquired or of the
land adjacent to the land acquired; and
(iv) It should possess similar advantages.
It is only when these factors are present, it can merit a
consideration as a comparable case (See Special Land
Acquisition Officer v. T. Adinarayan Setty (AIR 1959 SC 429)
These aspects have been highlighted in Ravinder Narain v.
Union of India (2003) 4 SCC 481.
3) we cannot lay any estimate what would be monetary compensation payable to you as it would depnd upon market value of land
4) you will have to explain reasons for delay in filing appeal before collector
