3/1/2010
The Supreme Court has ruled that the purpose for which land is being acquired will be one of the most important factors in determining its market value as well as award of compensation.
A bench comprising Justices G S Singhvi and Ashok Kumar Ganguly while announcing enhancement of the compensation to the land owners from Rs 75000 per acre, awarded by the Madras High Court, to Rs 175000 per acre noted, ‘The purpose for which the acquisition is being made is an important factor.
The question whether a land has potential value or not is primarily one of the facts depending upon its condition, situation, use to which it is put and proximity to residential, commercial or industrial areas or institutions, the bench said on Wednesday.
The existing amenities like water, electricity, possibility of their further extension, whether near about town is developing or has prospect of development have to be taken into consideration, it added.
About 196 acres of land were acquired under the Land Acquisition Act for the purpose of extension of Tamil Nadu Magnesite Limited, a state owned company in March and May 1984.
The state government awarded a compensation of Rs 18000 per acre for irrigated land and Rs 15000 for unirrigated dry land.
The reference court increased the compensation to Rs 175000 per acre.
The Madras High Court, while allowing the appeal of the state government, reduced the market value of the agricultural land at Rs 75000 per acre.
Justice Ganguly, writing a 26-page judgement for the bench, noted, ‘We observe that the reference court rightly fixed the amount of compensation to be Rs 175000 and we are inclined to uphold the said finding.’ In this case the land was acquired for constructing staff quarters for the company.
With this judgement the apex court by implications has held that Special Economic Zone(SEZ) land is acquired for a commercial purpose and therefore the market value of such land has to be determined accordingly. The land acquired for public purpose may have a different market value.
UNI
