Supreme Court Enhances Compensation in Haryana Land Acquisition Case

The case of M/s Acquainted Realtors LLP & Others vs. State of Haryana & Others revolves around the contentious issue of fair compensation for landowners whose lands were acquired for industrial development. This case involves multiple appeals against the compensation set for land acquired under the Land Acquisition Act, 1894 for the establishment of the Industrial Model Township (IMT), Manesar, in Gurgaon, Haryana. The Supreme Court was asked to determine whether landowners were entitled to a higher compensation than what had been decided by the High Court.

Background of the Case

The Haryana government initiated land acquisition proceedings through a notification dated 27th September 2005, under Section 4 of the Land Acquisition Act, 1894. The objective was to acquire land for IMT Manesar Phase-VI, a large-scale industrial development project. The declaration under Section 6 of the Act followed on 2nd June 2006, covering approximately 465 acres of land across multiple villages.

Compensation Fixed by the Land Acquisition Collector

The Land Acquisition Collector (LAC) assessed the market value of the land at Rs. 12.50 lakhs per acre through an award dated 24th January 2007. Dissatisfied with this valuation, several landowners filed references under the Land Acquisition Act, seeking enhanced compensation.

Decisions by Reference Courts and the High Court

Various Reference Courts considered the landowners’ claims and awarded different amounts of compensation, with some fixing the compensation as high as Rs. 68.32 lakhs per acre. The Haryana State Industrial and Infrastructure Development Corporation (HSIIDC), along with the state government, challenged these awards in the Punjab and Haryana High Court.

The High Court, in its judgment dated 1st June 2018, set the final compensation at:

Rs. 48.46 lakhs per acre for land near National Highway-8
Rs. 43.61 lakhs per acre for land further inside

However, many landowners were still dissatisfied with this compensation and appealed to the Supreme Court, seeking further enhancement.

Petitioners’ Arguments

The landowners argued that:

The lands had high industrial potential due to their proximity to major highways and economic corridors.
Several sale deeds of nearby plots indicated a market value exceeding Rs. 1 crore per acre.
The High Court should have applied an annual escalation of 12% to account for the increasing land value.
Post-acquisition sale transactions supported the claim for higher compensation.

Respondents’ Arguments

The Haryana government and HSIIDC contended that:

The High Court had already reasonably assessed the land value based on expert reports.
Comparing land acquired for industrial projects with private sale transactions was misleading.
Granting excessive compensation would inflate land acquisition costs and disrupt future development projects.

Supreme Court’s Findings

The Supreme Court, comprising Justices Uday Umesh Lalit and Vineet Saran, analyzed the land valuation process and made the following key observations:

1. Comparison with Previous Land Acquisitions

The Court referred to the decision in HSIIDC v. Roshan Lal & Others, where a valuation of Rs. 43.61 lakhs per acre was established for lands in adjacent villages. The Court noted that the present lands were similar in location and development potential.

2. Consideration of Market Trends

The Court ruled that cumulative market appreciation must be factored into land valuation. Although the High Court had initially rejected this, the Supreme Court found it reasonable to apply a flat increase of 8% to account for inflation and rising market prices.

3. Exclusion of Certain Sale Deeds

The landowners had cited a sale deed dated 28th April 2004 (Exhibit P-27), where land was sold for Rs. 1.13 crores per acre. However, the Court found that this transaction included industrial buildings and machinery, making it an unreliable comparison for vacant agricultural land.

4. Adjustment Based on Land Use Potential

The Supreme Court noted that the lands in question were further inside and away from the main highway. However, due to the presence of the Kundli-Manesar-Palwal (KMP) Expressway, they had gained additional industrial potential.

5. Final Compensation Determination

After considering all factors, the Court enhanced the compensation by 8% over the High Court’s valuation, setting the final market value at:

Rs. 47.10 lakhs per acre (rounded off) for affected landowners.

Judgment and Conclusion

The Supreme Court ruled:

“These appeals are allowed to the extent indicated above. The landholders must be held entitled to an 8% flat increase over the market value assessed by the High Court.”

With this ruling, the Supreme Court ensured that landowners received fair compensation while maintaining a balance between development needs and property rights.

Petitioner Name: M/s Acquainted Realtors LLP & Others.
Respondent Name: State of Haryana & Others.
Judgment By: Justice Uday Umesh Lalit, Justice Vineet Saran.
Place Of Incident: Haryana.
Judgment Date: 08-04-2021.

Don’t miss out on the full details! Download the complete judgment in PDF format below and gain valuable insights instantly!

Download Judgment: ms-acquainted-realt-vs-state-of-haryana-&-o-supreme-court-of-india-judgment-dated-08-04-2021.pdf

Directly Download Judgment: Directly download this Judgment

See all petitions in Property Disputes
See all petitions in Compensation Disputes
See all petitions in Judgment by Uday Umesh Lalit
See all petitions in Judgment by Vineet Saran
See all petitions in partially allowed
See all petitions in Modified
See all petitions in supreme court of India judgments April 2021
See all petitions in 2021 judgments

See all posts in Civil Cases Category
See all allowed petitions in Civil Cases Category
See all Dismissed petitions in Civil Cases Category
See all partially allowed petitions in Civil Cases Category