PAKISTAN THROUGH THE SECRETARY, MINISTRY OF DEFENCE, GOVERNMENT OF PAKISTAN RAWALPINDI AND Another vs Malik MUHAMMAD ASLAM AND 5 Other
This petition for leave to appeal arose from a dispute regarding the enhancement of compensation for land acquired by the Federal Government under the Land Acquisition Act, 1894. The core legal question was whether the trial court and the High Court erred in determining the market value of the acquired land by allegedly relying on post-notification sale transactions, rather than the quinquennial average price. The Supreme Court dismissed the petition, holding that the lower courts correctly assessed the market value based on the land's potential and location, rather than relying solely on the unreliable quinquennial average. The Court clarified that while the quinquennial average is a relevant piece of evidence, it is not conclusive, especially when it fails to reflect the actual market conditions or when it is based on incomplete data. The ratio established is that the determination of compensation must reflect what a willing purchaser would realistically pay for the land at the time of the notification, and courts may consider surrounding circumstances and evidence beyond just the quinquennial average to ascertain this fair market value.
- Is the quinquennial average price the sole determinant for assessing compensation in land acquisition cases?
- Can a court consider evidence of land value beyond the quinquennial average when determining market value under the Land Acquisition Act 1894?
- Does the reliance on post-notification sales invalidate a compensation award if the court's valuation is otherwise supported by the land's specific characteristics?
- Section 4, Land Acquisition Act 1894
- Section 18, Land Acquisition Act 1894
- Section 21, Land Acquisition Act 1894
ORDER
NASIM HASAN SHAH, J.-By this petition leave to appeal is sought against the judgment of the Lahore High Court. Lahore, dated 2nd March 1977, whereby the appeal filed by Pakistan through the Secretary, Ministry of Defiance, against the enhancement of compensation decreed by the Administrative Civil Judge, Rawalpindi, was dismissed.
2. The relevant facts, briefly stated, are that land measuring 13 kanals 7 marlas, situated as Peshawar Road, Rawalpindi, belonging to Khan Bahadur Malik Nazar Muhammad Khan predecessor-in-interest of the respondents was acquired by the Federal Government through a notification under section 4 of the Land Acquisition Act, 1894, date 5-6-1957. Compensation for the said land was assessed by the Land Acquisition Collector, Rawalpindi, in his award made on 31-12- 1950, at Rs. 2,200 per kanal. The award was not accepted by the land owner on the ground that the land wag meant for residential purposes, as it was situated in a fully developed are-a known as Radio Colony and was surrounded by bungalows and its market value was not less than Rs. 7,090 per kanal. Consequently, on his written request the Land Acquisition Collector referred the matter under section 18 of the Land Acquisition Act to the civil Court for fixation of the correct compensation.
3. The civil Court, on the evidence of the parties, found that the land in dispute was a very suitable building place. The quinquannal average showing the price at Rs. 2,258 per kanals retied upon by the Land Acquisition Collector was unreliable because it was based of three mutations, whereas several other sales bad taken place within the area, but were not entered in the revenue record.
The learned trial Court also observed that even in the said quinquennial average a piece of land measuring 4 marlas was shown to have been sold for Rs. 1,000. i.e., at the rate of Rs. 7.500 per kanal.
As such, the average price shown in the quinquennial average could not be applied to the land in dispute and opined that, in view of its special features the land mast carry a pace higher than the average price. He also referred to four transactions of sale (Annexure A/1, A/2, A/3 and A/5) which had taken place from 31-10-1959 to 8-2-1961 relied upon by the respon--dents, which showed that the building sites situated near the suit land were sold for prices ranging between Rs. 5,000 and Rs.
15,000 per kanal. Keeping in view the situation, the kind of land involved and the other relevant circumstances, he concluded that the market value of the land at the time of notification tinder section 4 of the Laud Acquisition Act was Rs. 4,500 per kanal.
4. The present petitioners filed an appeal against the above determination in the Lahore High Court. While the appeal was pending, Khan Bahadar Nazar Muhammad Khan died. It appears that an application was submitted to tying his legal representatives on the record, but no order was passed on this application, with the result that an application has also been submitted in this Court seeking permission to suo his legal representative. According to the office note the appeal against the legal representatives is barred by 1843 days.
5: Be as it may, the High Court disposed of the appeal on the merit and after discussing the evidence on the record came to the conclusion that trial Court was correct and accordingly dismissed.
6. The only contention pressed before us by Mr. M. A. Lone, Advocate, on behalf of the petitioner, was that the trial Court as well as the High Court has been influenced by the four instances of sales, relied upon by the respondents, but as these sales pertained to the period froth 31-10-1959 to 8-2- 1961 they were irrelevant as market value of the land was to be determined with reference to the date of notification issued under section 4 of the Land Acquisition Act, namely, 5-6-1957. The post notification sales being irrelevant, the price given in the quinquennial average was the only relevant piece of evidence which could form the basis for assessment of compensation.
7. The submission is without force. According to section 21 of the Land Acquisition Act, in determining compensation the market value of the land on the date of publication of the notification under section 4 is to be ascertained. The Ausat Panjeala or the quinquennial average price is no doubt a relevant piece of evidence in this regard, but learned civil Court found, as a matter of fact, that this document was unreliable as a large number of sale were not entered therein and was based only on three transactions. Moreover, the land in dispute was situate in a far better, place than the instances noted in the quinquenial average. This view was endorsed by the High Court and we also consider to be sound. If tine t criterion of what a willing purchaser would have paid for the land in question was followed, the price fixed by Civil Court, after considering all the relevant factors, was the correct one. The submission that the civil Court relied upon the post notification sales for fixing the above mentioned price is not correct because a fair reading of its order shows that reference has been made to the said sales only to show that the building sites situated near the suit land were sold for prices ranging between Rs. 5,000 to Rs. 15,000 per kanal, not long after the date of the issuance of the acquisitions notification.
8. This is not a fit case for interference. Accordingly, this petition is dismissed.
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