Karnataka High Court Sets New Rules for Determining Market Value of Land Acquired Under 1894 Act

Karnataka High Court Sets New Rules for Determining Market Value of Land Acquired Under 1894 Act

The Karnataka High Court recently clarified that the market value of land must be based on Section 26 of the Right to Fair Compensation and Transparency in Land Acquisition Rehabilitation and Resettlement Act 2013 if the acquisition has taken place after promulgation of the 2013 Act under Section 4(1) the Land Acquisition Act 1894.

The bench of Justice S Sunil Dutt Yadav permitted an appeal filed by M/s Deco Equipments Pvt Ltd and set aside the January 20, 2016 Award pronounced by the Land Acquisition Officer, Mysore District.

The Bench stated any notification under the 1894 Act that the market value should be determined for the Award that might have been passed after coming into force of the 2013 Act with January 1, 2014, as the cutoff date.

The initial notification under Section 4(1) of the Land Acquisition Act, 1894 was issued on March 15, 2008, while the final notification under Section 6 and 17(1) of the 1894 Act was passed on June 5, 2009.

The challenge of the petitioner to the validity of the notification was disposed of, and the matter was forwarded for fresh disposal after allowing a hearing under Section 5-A of the 1894 Act. The Notification was published under Section 6(1) of the 1894 Act After rejecting the objections of the petitioner.

The petitioner opted to challenge the validity of the Notification. The 2013 Act came into force during the pendency of the proceedings. The petition was disposed of while the petitioner was directed that if an award had not been passed as of date, it would be necessary for determination of compensation under the 2013 Act as is made plain under Section 24(1) of the 2013 Act.

The Special Land Acquisition Officer, however, went on to pass an Award established on the market value by considering the Sale Deed which was dated April 21, 2007, for ₹78 lakh, and following the norms fixed in the Gazette Notification dated April 4, 2013.

The Bench referred to Section 24 of the 2013 Act, which reads: "(1) Notwithstanding anything contained in this Act, in any case of land acquisition proceedings initiated under the Land Acquisition Act, 1894 (1 of 1894) - (a) where no award under Section 11 of the said Land Acquisition Act has been made, then, all provisions of this Act relating to determination of compensation shall apply."

The Court held that in this particular case, while the petitioner had initially challenged the validity of the proceedings, the petitioner had settled for the relief of entitlement of compensation in terms of the 2013 Act during the proceedings, and accordingly, the petition was disposed of.

The Court, therefore, allowed the petition and directed the Land Acquisition Officer to pass a fresh Award while re-working the compensation in light of the discussion at Point-(a) supra and is to strictly adhere to the Guidelines under Section 26 and other applicable Rules made under the 2013 Act.