Partly allowed

T.Raghu Prasad v. the State of Kerala

Kerala HC10 Aug 2022CO/4/2022

Case brief

AI extract

What is this about?

The High Court allowed the state's appeal challenging the land value and dismissed the claimant's interest claim, then partially allowed the cross objection. The court refixed land value to Rs.1,35,000 per cent and directed the state to pay interest as state retention of funds in revenue account violated statutory deposit requirements.

What did the court decide?

Award refixed at Rs. 1,35,000 per cent; State directed to pay interest on Rs. 9,25,902 from 09.02.2011 to 27.01.2016 under Section 34.

T.Raghu Prasad Vs the State of Kerala — Banking and Recovery | Kerala HC (2022)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE ANIL K.NARENDRAN

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THE HONOURABLE MR.JUSTICE P.G. AJITHKUMAR

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WEDNESDAY, THE 10^TH DAY OF AUGUST 2022 / 19TH SRAVANA, 1944

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L.A.APP. NO. 156 OF 2018

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AGAINST THE JUDGMENT AND DECREE DATED 15.11.2017 IN L.A.R.NO.18 OF 2016 OF THE PRINCIPAL SUB COURT, KOZHIKODE

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APPELLANTS/RESPONDENTS:

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1 STATE OF KERALA

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REPRESENTED BY THE DISTRICT COLLECTOR, KOZHIKODE.

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2 THE SPECIAL TAHSILDAR (LA), KOYILANDY.

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BY SMT N.SUDHA DEVI- SPL.GOVERNMENT PLEADER

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RESPONDENTS/CLAIMANT & ADDL.R2:

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1 T. REGHUPRASAD,

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S/O.APPU NAIR, CHEMBOTHINGAL HOUSE, NELLIKODE.P.O, KOZHIKODE TALUK, PIN-673016.

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2 THE MANAGING DIRECTOR,*

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KERALA STATE IT INFRASTRUCTURE LTD., IST FLOOR, SANKETHIKA, PF ROAD, PATTOM, THIRUVANANTHAPURAM695004.

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*IMPLEADED AS ADDL. R2 AS PER THE ORDER IN I.A. NO. 1/2021 DATED 11.11.2021.

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BY ADVS. R1 BY SRI.JACOB ABRAHAM K.A.THANU MOL R2 BY K.A.ABDUL SALAM R2 BY SUNIL V.MOHAMMED

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THIS CROSS OBJECTION/CROSS APPEAL HAVING COME UP FOR FINAL HEARING ON 03.08.2022, ALONG WITH CO.4 OF 2022, THE COURT ON 10.08.2022 DELIVERED THE FOLLOWING:

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE ANIL K.NARENDRAN

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THE HONOURABLE MR.JUSTICE P.G. AJITHKUMAR WEDNESDAY, THE 10^TH DAY OF AUGUST 2022 / 19TH SRAVANA,

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1944

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CROSS OBJECTION NO. 4 OF 2022

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IN L.A.A.NO.156 OF 2018

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(AGAINST THE JUDGMENT AND DECREE DATED 15.11.2017 IN

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L.A.R.NO.18 OF 2016 OF THE PRINCIPAL SUB COURT,

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KOZHIKODE)

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CROSS OBJECDTOR/1ST RESPONDENT/CLAIMANT:

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T.RAGHU PRASAD, AGED 71 YEARS, S/O. T. APPU NAIR, CHEMBOTHINGAL HOUSE, NELLIKODE P. O., KOZHIKODE - 673016.

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BY ADVS. JACOB ABRAHAM KOCHUMOL KODUVATH

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RESPONDENTS/APPELLANTS & 2ND ADDL.RESPONDENT/RESPONDENTS:

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1 THE STATE OF KERALA REPRESENTED BY THE DISTRICT COLLECTOR, KOZHIKODE - 673020.

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2 SPECIAL TAHSILDAR (LA) KOYILANDI - 673305.

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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3 KERALA STATE IT INFRASTRUCTURE LTD. THE FIRS FLOOR, SANKETHIKA, PATTOM PALACE P. O., THIRUVANANTHAPURAM - 695 004.

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BY ADVS.

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R1-R2 BY SMT N.SUDHA DEVI- SPL.GOVERNMENT PLEADER R3 BY K.A. ABDUL SALAM R3 SUNIL V.MOHAMMED

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THIS CROSS OBJECTION/CROSS APPEAL HAVING COME UP FOR FINAL HEARING ON 03.08.2022, ALONG WITH LA.App.NO.156 OF 2018, THE COURT ON 10.08.2022 DELIVERED THE FOLLOWING:

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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JUDGMENT

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Ajithkumar, J.

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The State of Kerala filed this appeal under Section 54 of the Land Acquisition Act, 1894 and Order XLI, Rule 1 of the Code of Civil Procedure, 1908, challenging the judgment and decree in L.A.R.No.18 of 2016 on the file of the Principal Sub Court, Kozhikode. The L.A.R. arose on the reference under Section 18 of the Act. The 1^st respondent is the claimant. He has filed the Cross Objection, dissatisfied with the compensation awarded by the Reference Court.

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Heard the learned Special Government Pleader, the learned counsel appearing for the 1^st respondent and the learned Standing Counsel for the 2^nd respondent.

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An extent of 0.0552 Hectares of land comprised in re-survey No.172/6 of Nellikode Village belonging to the 1^st respondent was acquired for the purpose of setting up an IT Park at Kozhikode. The notification under Section 4(1) of the Act was issued on 21.08.2009. An award was passed on

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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05.02.2011. Possession of the property was taken over on

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09.02.2011. The 1^st respondent protested against the sufficiency of compensation. On the basis of the reference made to the Sub Court, Kozhikode, L.A.R.No.18 of 2016 was initiated. After trial, the Reference Court fixed the land value

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at Rs.1,85,000/- per cent and passed a decree as follows:

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“(1) That the respondents do pay to the claimant a sum of Rs.19,17,354/- (Rupees nineteen lakh seventeen thousand three hundred and fifty four only) being the enhanced compensation for land, improvement, structures.

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(2) That the claimant is also entitled to get 30% solatium on the enhanced land value of Rs.19,17,354/-.

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(3) That claimant is entitled to get 12% additional compensation on the enhanced land value of Rs.19,17,354/for the period from the date of Section 4(1) notification ie., 21.08.2009 till the date of award ie., 05.02.2011.

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(4) That the claimant is entitled to get 9% interest on the enhanced compensation ie., enhanced land value, 30% solatium and 12% additional compensation, for the period of one year from the date of taking possession ie., from 09.02.2011 and thereafter at the rate of 15% per annum till the date of payment.

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(5) That the respondent do pay to the claimant a sum of Rs.15,135/- being the cost of this reference.”

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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The State is aggrieved of fixing the land value at Rs.1,85,000/- per cent. It is contended that the Reference Court went wrong in fixing such a value for the land merely on the basis of guesswork. On the other hand, the 1^st respondent assailed the award by contending that the acquired land would fetch Rs.10 lakhs per cent, but the Reference Court awarded only a meager enhancement. It is contended that the land involved in Ext.A3 is similar and similarly situated to the acquired land, and the Reference Court should have accepted Ext.A3 as exemplar value. Accordingly, the 1^st respondent sought to enhance the market value of the land to Rs.10 lakhs per cent.

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The 1^st respondent filed I.A.No.2 of 2021 claiming interest for the award amount during the period when the amount was kept in revenue deposit, ie., from 09.02.2012 till 07.01.2016. The case of the 1^st respondent is that instead of depositing with the account of the court the amount due to him, as contemplated in Section 31 of the Land Acquisition

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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Act, the appellant claimed to have deposited the award amount in a revenue deposit, thereby the appellant itself was utilising the said amount during all the periods till it was disbursed to the 1^st respondent. He, therefore, claims that he is entitled to get interest during the said period.

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The 2^nd respondent has filed a reply affidavit in I.A.No.2 of 2021. It is contended that the award amount was deposited in the revenue account as provided in the relevant rule and notice regarding the said deposit was duly issued. It was due to the lapse on the part of the 1^st respondent alone, he could not receive the amount in time. Therefore, there is no justification for claiming interest for the amount during the period in which the amount was available with the revenue deposit for being drawn by the 1^st respondent. Accordingly, the 2^nd respondent seeks to reject the claim for interest.

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It is pointed out by the learned Government Pleader as well as the learned Counsel appearing for the 1^st respondent that this Court passed a common judgment in

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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L.A.Appeal No. 488 of 2015 and connected cases on 28.05.2018. The findings in the said judgment with regard to fixation of the market value of the land in category No.1 is applicable to the land involved in this case as well. Category No.1 lands involved in acquisition as per Section 4(1) notification dated 21.08.2009 are the garden lands with road access. The property involved in this case also is of the same kind and valued by the Land Acquisition Officer included it in category No.1.

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L.A.A.No.488 of 2015 is one among the appeals

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disposed of as per the common judgment dated 28.05.2018. In L.A.A.No.488 of 2015, the market value of the land which included in category No.1 was fixed by this Court as Rs.1,35,000/- per cent. In view of that, this L.A.A. is liable to be allowed by refixing value of the land at Rs.1,35,000/-. The Cross Objection is therefore liable to be dismissed. The 1^st respondent is hence entitled to compensation by fixing the market value of the land at Rs.1,35,000/- per cent along with all statutory benefits.

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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The 1^st respondent claimed interest for the amount awarded by the Land Acquisition Officer of Rs.9,25,902/- for the period from 09.02.2012 till 27.01.2016 at the rate admissible under Section 34 of the Act. The facts averred by the 1^st respondent are not disputed. The Land Acquisition Officer passed the award on 05.02.2011. Possession was taken over on 09.02.2011. The 1^st respondent did not turn up to receive the award amount. It is contended by the 2^nd respondent that due notice was given to the 1^st respondent to receive the award amount and since he did not turn up, the amount was deposited in a revenue account.

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The learned counsel appearing for the 1^st respondent would contend that it is mandatory under Section 31 of the Act to deposit the amount of compensation in the court and any violation thereof will oblige the State to make payment to the claimant interest in terms of Section 34 of the Act. In this regard, the learned counsel placed reliance on the decision of the Apex Court in Ivo Agnelo Santimano

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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Fernandes and others v. Government of Goa and another [(2011) 11 SCC 506] .

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The learned Government Pleader, on the other hand, would contend that going by Rule 31(2) of the Land Acquisition (Kerala) Rules, 1990, in the event of failure of a claimant to receive the award amount despite receiving notice, the Land Acquisition Officer shall pay the amount into the Treasury as a revenue deposit payable to the person to whom it is due. In terms of the provisions of the said rule, the Land Acquisition Officer had issued a notice to the 1^st respondent in Form No.10(b), a copy of which has been produced as Annexure R2(a). Therefore, the learned Government Pleader as well as the Standing Counsel appearing for the 2^nd respondent would contend that the 1^st respondent is not entitled to get the interest. It is also contended that it was only for the fault of the 1^st respondent he could not receive the amount in time and that also disentitles him from claiming interest.

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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Annexure R2(a) shows that notice to the 1^st

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respondent was served by affixture. He does not have a contention that the same was not a valid notice. So it cannot be said that there was no notice regarding the deposit of compensation amount with the revenue account. The Land Acquisition (Kerala) Rules were framed by the State in the exercise of its powers under sub-section (1) of Section 55 of the Land Acquisition Act, 1894. Rule 13(2) explains the provisions of Section 31 of the Act by prescribing a different kind of account for depositing the award amount. It cannot be said that the said rule is ultravires the Statute. But by such deposit alone, whether the State would be absolved from making payment of interest, is

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a question to be decided independently. In Ivo Agnelo (supra), the Apex Court held that,-

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“19. In the light of the abovesaid principle, we are of the view that the contentions of the respondents cannot be accepted. The Act requires that the interest be deposited in court, and the same has been upheld in the case of Prem Nath Kapur & another v. National Fertilizers Corporation of India Ltd. & others reported in

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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(1996) 2 SCC 71. In the present case, the respondents did not deposit the amount in court, but in their Revenue account and utilized the same. Even if the respondent State does pay the compensation to the claimants directly, and the same is not collected, the respondent State cannot then keep the said money with itself and utilize it. In such cases, after a reasonable period, if the claimants do not come forward to collect compensation, then it should be deposited in court by the State. Allowing the State to keep the compensation with itself and utilizing it cannot possibly be permitted being contrary to the provisions of the Act and the law laid down in Prem Nath Kapur (supra). Hence, the judgment of the High Court is clearly erroneous and deserves to be set side.”

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Here also, the deposit was made in the revenue

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account. It goes without saying that even after making such a deposit, the amount is at the hands of the State itself and the same would be available to be utilised for State purposes. Further, the reasoning given by the Apex Court for directing to pay interest is that if the claimant does not collect the amount even after a reasonable period of making the deposit in the revenue account, the award amount should be deposited in

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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court by the State. Here, after giving notice regarding the deposit in the revenue account, the 1^st respondent-claimant did not receive the amount. The State, therefore, should have transferred the deposit to the account of the court after a reasonable time. The failure definitely casts liability on the State to pay interest for the sum to the 1^st respondentclaimant.

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Viewed so, we are of the view that the 1^st respondent is entitled to get interest for the award amount of Rs.9,25,902/- for the period from 09.02.2011 to 27.01.2016 as provided in Section 34 of the Act.

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To sum up,

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(1) L.A.A.No.156 of 2018 is allowed;

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(2) The judgment and decree is L.A.R.No.18 of 2016 of the Principal Sub Court, Kozhikode are modified by refixing the land value at Rs.1,35,000/- (One Lakh and Thirtyfive thousand only) per cent;

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(3) The 1^st respondent-claimant is entitled to get all the statutory benefits on such market value;

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(4) Cross objection No.4 of 2022 is dismissed.

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L.A.A.No.156 of 2018 & Cross Objection No.4 of 2022 in L.A.A.No.156 of 2018

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(5) I.A.No.2 of 2021 is allowed by directing to pay interest at the rates prescribed in Section 34 of the Land Acquisition Act for the award amount of Rs.9,25,902/for the period from 09.02.2011 to 27.01.2016.

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