Would Be Fair & Just If Appellants Are Meted Equal Treatment As Other Affected Landowners: SC Restores Reference Court's Order In LA Case

The Supreme Court has upheld the order of the Reference Court, which had awarded higher compensation to the landowners of Village Nimeta whose lands were acquired for the Vadodara Branch Canal of the Narmada Project.

The Court reaffirmed the fundamental principle that, in a welfare state like ours is dedicated to ensuring social and economic justice for all its citizens. In light of this principle, the Court emphasized the importance of treating all affected landowners equally, including those in Village Nimeta, just as the other impacted landowners in Village Morlipura.

The Bench comprising of Justice Bela M. Trivedi and Justice Dipankar Datta observed, “In the light of such confirmation, we are of the view that the appellants cannot be worse off than the other affected landowners of the same village, i.e., Morlipura, who have been paid more compensation. In a welfare state like ours where we have promised all the citizens social and economic justice, it would be fair and just if the appellants are meted equal treatment as the other affected landowners (claimants in Reference Case Nos.61-62 of 2017)”.

Advocate Purvish Jitendra Malkan appeared for the Appellant and Advocate Deepanwita Priyanka appeared for the Respondent.

The landowners, whose lands were acquired under section 54 of the Land Acquisition Act, 1894 (Act) for the Vadodara Branch Canal of the Narmada Project (Project), challenged the compensation awarded by the Land Acquisition Officer (LAO), wherein the calculated market value of their land was Rs.19,000/ per hectare (i.e., Rs.1.90 per square meter). The Reference Court had enhanced the amount of compensation to Rs 4,00,000/- per hectare (i.e., Rs.40/- per square meter), but the High Court had reduced it to Rs.7/- per square meter. The High Court found that the Reference Court had erred in relying on the award of another Reference Court in a case where the purpose of the acquisition was different. In a previous case, the High Court had determined the market value of land in the village Nimeta (where the land in question is located) to be Rs.7/- per square meter. Aggrieved by the order of the High Court, the affected landowners filed a set of Civil Appeals.

The Supreme Court observed that there were errors in the compensation rates for land acquisition. The Reference Court used price values of a different village, and the High Court used outdated rates.

The Court emphasized that the prior acquisition of 1981 could not guide compensation for the 1986 acquisition. The Court also noted errors in determining just compensation and cited a Reference Case of 2017 where affected landowners received Rs 4,00,000/- per hectare. The State submitted a record that the revised rates (per the rates set by the Reference case of 2017) were disbursed to the affected landowners.

The Court was also apprised of the fact that the judgment and award dated 21st March 2018 of the  Reference Court has, in fact, been accepted and the additional amount which was awarded has been deposited in court on 28th January 2019.

Thus the Court held, "In the light of such confirmation, we are of the view that the appellants cannot be worse off than the other affected landowners of the same village, i.e., Morlipura, who have been paid more compensation."

Accordingly, the Court allowed the appeals and restored the order of the Reference Court.

Cause Title: Kalubhai Khatubhai Etc. v State of Gujarat & Ors. (2023 INSC 713)

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