1. Javed Iqbal, J.--This appeal preferred on behalf of appellant' under Section 54 of the Land Acquisition Act, 1894 is directed against the judgment/decree dated 30.5.2003 of the Peshawar High Court, Peshawar whereby the RFA preferred on behalf of appellant has been accepted and the compensation of acquired land was enhanced to Rs.12654/- per marla with 15% compulsory acquisition charges and 6% simple interest on the enhanced amount.
2. Precisely stated the facts of the case are that pursuant to notification under Section 4 of the Land Acquisition Act, 1894 on 7.2.1984, 5 kanals 18 marlas of land was acquired for construction of a bypass road from Charsadda Bus Stand Mardan to Gujar Garhi road from the appellant and compensation was fixed as Rs.3389/69 per mart by means of award dated 22.6.1989. A fresh award was also issued on 2.9.1992 and the price was reduced to Rs.3042.51 per marla as the alignment of the road was not found correct. The appellant filed Reference under Section 18 of the Land Acquisition Act, 1894 against the -award dated 22.6.1989 which was withdrawn in view of the latter award made on 7.1.1991 and a new reference was made whereby the ' price of land was enhanced from Rs. 3042.51 per merle to that of Rs. 5016.51 per marla by the learned Referee Judge by means of judgment/decree dated 10.4.1997. Being aggrieved, RFA was preferred on behalf of appellant which has been disposed of vide judgment impugned enhancing the price from Rs.5016.51 to that of Rs.12,654/-per marla which has been assailed by means of this appeal.
3. Mr. Maazullah Khan Barkundi, learned ASC entered appearance on behalf of appellants and contended that'the potential and commercial value of the land "in question has not been determined in accordance with the evidence which has come on record and moreso the determination of price is not in consonance with the provisions as enumerated in Section 23 of the Land Acquisition Act, 1894. It is also argued that the market value of the land, per marla in the village was. Rs.50,000/- which has been ignored by the learned High Court without any rhyme and reason causing grave loss to the appellant. It is also contended that the learned trial and appellate courts have committed error by not making the report of Local Commissioner as part of the record as neither the Local Commissioner was called nor the report was got exhibited. It is pointed out that had the Local Commissioner being called the position would have been different.
4. We have carefully perused the award, its reasoning, judgment of learned Referee Judge as well as the judgment impugned. The only question which needs determination would be as to whether the compensation has been determined in accordance with the provisions as contained in Section 23 of the Land Acquisition Act, 1894 and commercial/potential value of the land in question has been kept in view or otherwise? The question as to how the, price of acquired land is to be determined, has been examined and answered by this Court in various cases in a comprehensive manner and guideline has-been provided in case Province of Punjab v. Jamil Ahmad Malik (2000 SCM R 870), which is reproduced herein below for ready reference:- "10. The cardinal principle for ascertaining the value of the land under acquisition is to find out the price acceptable to a willing seller from a willing purchaser. Attending this principle, we notice that the rate of compensation given by the Referee Court being much-less to that of the claim made by the owners was not exorbitant arid, therefore, taking the relevant factors into consideration, the rate of compensation awarded by the Referee Court was fair. Undoubtedly, there is no rule that a post notification transaction of sale of similar land cannot be looked into to find out the correct value of the, land, but it is seen that after publication of the notification under Section 4 of the Land Acquisition Act, 1894, the price of, the land in the locality is affected and, therefore, to place reliance on such a transaction of sale will not be a proper guidance for the determination of the market value of the acquired land. However, in the present case, the collector or the Referee Court did not include any such transaction for the purpose of calculation of the market value of the land and therefore, the determination of the market value of land acquired by the Referee Court on the basis of the documentary evidence of the mutations of sale alongwith the other factors was supported by cogent reasons."
14. Reference may also be made to Pakistan Burma Shell Ltd. v. Province of N.-W.F.P. and 3 others (1993 SCM R 1700) and Haji Muhammad Yaqoob and another v: Collector, Land Acquisition/Additional Deputy Commissioner, Peshawar (1997 SCM R 1670).
2. In the case of Pakistan Burma Shell (supra) this Court observed as under:---- "6. We are not pursuaded to strike off the award on the rectitude of these submissions, Section 23 makes mention of various matters to be considered in determining the compensation. One of such factors enumerated therein is that the date relevant for determination of market value is that date of the notification under Section 4. Not unoften the market value has been described as what a willing purchaser would pay to the willing seller. It may be observed that in assessing the market value of the land, its location, potentiality and the price evidenced by the transaction of similar land at the time of notification are the factors to be kept in view: One year's average of the sales (taking place before the publication of the notification under Section 4 of similar land is merely one of the modes for ascertaining the market value and is not an absolute yardstick for assessment."
3. 15.The above principle was also quoted with approval in the case of Haji it Yaqoob (supra) wherein it was observed that it is well settled that one year's average sale price of the land in the vicinity preceding the date of notification under Section 4 of the Act, is only one of the relevant factors for consideration in determining the market value of the land but it alone cannot be adopted as the basis for assessm ent of market value, if there is other evidence available on record to establish the potential value of acquired land at a higher rate.
4. 16.In the case of Province of Punjab through Collector, Bahawalpur and others v. Col. Abdul Majeed and others (1997 SCM R 1692), the following pinciples of law were laid down for assessing the future prospects of the land acquired under the Land Acquisition Act, 1894 in terms of Section 23:-- (i)That an entry in the Revenue Record as to the nature of the land may not be conclusive, for example, land may be shown in Girdawari as Maira, but because of the existence of a well near the land, makes it capable for becoming Chahi land.
5. (ii)That while determining the potentials of the land, the use of which the land is capable of being put, ought to be considered.
6. (iii)That the market value of the land is normally to be taken as existing on the date, of publication of the notification under Section 4(1) of the Act but for determining the same, the price on which similar land situated in the vicinity was sold during the preceding 12 months and not 6-7 years back may be considered including other factors like potential value etc. 17.The above principles were also consistently followed in Abdur Rauf Khan v. Land Acquisition Collector (1991 SCM R 2164), Gunj Khatoon v. Province of Sindh (1987 SCM R 2084), Fazalur Rahman v.
7. Collector (PLD 1988 SC 32) and Pakistan Burma Shell Ltd. v.. Province of N.-W.F.P. (1993 SCM R 1700).
8. 18.Reference may also be made to Murad Khan through his widow and 13 others v. Land Acquisition Collector, Peshawar and another (1999 SCM R 1647), wherein one Qf us (Muhammad Bashir Jehangiri, J.) had exhaustively laid down the criteria for determination, of fair compensation.
9. Relevant portion of the report reads thus:--- "The schedule of average price for four years or for that matter even Hof one year are not the only criterion for determining the amount of compensation but the. 'other material brought on the file is quite relevant to determine the correct amount of compensation for the acquired land. Section 23 of the Land Acquisition Act, 1894 lays down, by way of criterion, that market value' of land on the date of publication of notification under Section 4 of the said Act would be the amount of compensation. The expression `market value' has not been defined in the Act.
10. Merely one year average price of the land in the same vicinity or the classification thereof is not exhaustive in itself but there are other considerations enumerated in the law which would also be relevant for determining the market, value, for fair compensation to be awarded to an owner whose land has been compulsorily acquired.
11. It is wrong to look for the classification alone of the land for the purpose Of determination of the fair compensation.
12. The following matters are to be taken into consideration in determining the amount of compensation:-- (i)The data from which the market-value of the land can be estimated is given in Rule 13 of the North-West Frontier Province Circular No. 54 issued presumably under Section 55 of the Act.
13. (ii)The best method to work out the market 'value is the practical method of a prudent man laid down in Article 2, Qanun-e-Shahadat 1984 to examine and analyse all the material and evidence available on the point and to' determine the price which a willing purchaser would pay to willing seller of the acquired (iii)Sub-section (1) of Section 23 of the Land Acquisition Act provides that in determining the amount of compensation the Court shall take into consideration the market value, loss by reason of severing such land from his other land, acquisition injuriously affecting his other property or his earning in consequence of change of residence or place of business and damage, if any, resulting from diminution of the profits of the land between the time of the publication of the declaration under Section 6 and the time of the Collector's taking possession of the land. This, however, is not exhaustive of other injuries or loss which may be suffered by an owner on account of compulsory acquisition.
14. (iv)The best method of determination of the market price of the plots of land under the acquisition is to rely on instances of sale of it near about the date of notification under Section 4(1) of the Land Acquisition Act. The next best method is to take into consideration, the instances of sale of the adjacent lands made shortly before and after the notification. When the- market value is to be determined on the basis of the instances of sale of land in the neighbouring locality, the potential value of the land need not be separately awarded because such sales cover the potential value: (v)The law provides determination of compensation not with reference to classification or nature of land but its market value at the relevant time. No doubt, for determining the market value, classification the nature of land may be taken as relevant consideration but that is not the whole truth. An area may be Banjar Qadeem or Barani but its market 'value maybe tremendously high because of its location, neighborhood, potentiality or other benefits.
15. (vi)While' determining the value of the compensation the market value of the land at the time of requisition/ acquisition and its potentiality have to be kept in consideration.
(vii) Consideration should be had to all the potential uses to which the land can be put as well as all the advantages, present or future which the land possesses in the hands of the owners.
(viii) In determining the quantum of fair compensation the main criterion is the price which a buyer would pay to a seller for the property if they voluntarily entered into the transaction.
16. (ix)The measure of fair compensation is the value of the property in open market which a seller voluntarily entering into a transaction of sale can reasonably demand from a purchaser this means that Court has to determine the value of the land in the open market at the relevant time on the assumption that the notification of acquisition did not exist.
17. (x)While determining the value of the land acquired by the Government and the price which a willing purchaser would give to the willing seller, only the past sales" should not be taken into account but the value of the land with all its potentialities may also be determined by examining (if necessary as Court-witness) local property dealers or other persons who are likely to know the price that the property in question is likely to fetch in the open market. In appropriate cases there should be no compunction even relying upon the oral testimony with respect to market value of the property intended to be acquired; because even while deciding cases involving question of life and death, the Courts rely on oral testimony alone and do not insist on the production of documentary evidence. The credibility of such witnesses would, however, have to be kept in mind that it would be for the Court in each case to determine the weight to be attached to their testimony. It would be useful and even necessary, to examine such witnesses while determining the market prices of the land in question, because of the prevalent tendency that in order to save money on the purchases of stamp papers and to avoid the imposition of heavy gain tax levies on sale of property, people declare or show a much smaller amount as the price of the land purchased by them than the price actually paid. The "previous sales" of the land, cannot, therefore, be always taken to be an accurate measure for the determining the price of land intended to be acquired.
18. (xi)The sale-deed and mutation entries do serve as an aid to the prevailing market value.
(xii) In cases of compulsory acquisition effort has to be made to find out what, the market value of the acquired land was or could be on the material date. While so venturing the most important factor to be kept in mind would be the complexion and character of the acquired land on the material date. The potentialities it possessed on that date are also to be kept in view in determining a fair compensation to be awarded to the owner who is deprived of his land as a result of compulsory acquisition under the Act.
(xiii) The value of the land of the adjoining area which was simultaneously acquired and for which different formula of compensation has been adopted should be taken into, consideration.
(xiv) The phrase market value of the land' as used in Section 23(1) of the Act, means 'value to the owner' and, therefore, such value must be the basis for, determination of compensation. The standard must be not -a subjective standard but an objective one. Ordinarily, the objective standard would be the price that owner willing and not obliged to sell might reasonably expect to obtain from a willing purchaser. The property must be valued not only' with reference to its condition at the time of the determination but its potential value must be taken into consideration.
5. We have examined this appeal on the touchstone of, the criterion as laid down in various cases and mentioned herein above. It transpires from the scrutiny of judgment impugned that the entire documentary and oral evidence such as copy of Jamabandi for the years 1980-1981 (Ex.P.W.2/1), Aks Shajara Kishtwar (Ex.O.W.2/2), site-plan of the acquired land (Ex.P.O./3); one year average. w.e.f.
19. 7.3.1983 to 7.3.1984, average from 2.5.1984 .to 2.9.1992 (Ex.O.W.2/5 to 2/10); and the statement of Riazul Islam, Sub-Engineer, Highway Division Mardan (R.W.1) have been examined. The High Court has rightly enhanced the price on the basis of one year average for the period from 2.9.1991 to 2.9..1992. It is worthwhile to mention here that the High Court has kept in view the commercial and potential value of the acquired land in the judgment impugned which being well based does not warrant interference.' The compensation has been enhanced to Rs.12654/- per marla which is, in consonance with the law laid down by this Court as' well as the provisions as enumerated in Section 23 of the Land Acquisition Act, 1894.
20. In sequel to above mentioned discussion this appeal being merit less is dismissed and leave refused.