' MUHAMMAD REAZ AKHTER CHAUDHRY, C J.- This appeal is directed against the judgment and decree of the High Court dated 5-12-2005, whereby the appeal filed by appellant was dismissed.
2. The relevant and necessary facts, for the disposal of instant appeal, are that the Collector Land Acquisition acquired the land of the appellant, measuring 5 kanals, comprising survey No,384-min, situated in village Basar, for the construction of Girls High School, through award No,2207-09/AC/03 on 9.12.2003. The price of land was determined by the Collector Rs,4207/ per marla along with 15% compulsory acquisition charges. Feeling dissatisfied with the amount of compensation, Abdul Aziz, appellant, filed a reference under section 18 of the Land Acquisition Act. The learned Reference Judge (Additional District Judge) vide judgment dated 12.3.2005 enhanced the price of the land as Rs,6,000/- per marla instead of Rs,4207/- per marla along with 15% compulsory acquisition charges. The appellant filed an appeal against the judgment and decree of the learned Reference Judge in the High Court of Azad Jammu and Kashmir. This appeal was dismissed by the learned single Judge of the High Court vide judgment dated 5-12-2005. The instant appeal has been filed against the aforesaid judgment of the High Court.
3. Ch. Muhammad Sabir, the learned counsel for the appellant, argued that the price of the land has not been fixed according to the market value of the land. He submitted that after the year 1997 no land was sold from village Basar, therefore, reliance was to be placed on the sale-deeds of other adjacent villages. He further submitted that the report of Patwari regarding the average of one year sale-deeds pertains to village Thara. In the said report he has not mentioned the dates of sale-deeds. He has mentioned the dates of sanction of mutations, while the market value of the land was to be determined on the basis of dates mentioned in the sale-deeds, not the dates on which the mutations were sanctioned. He referred Exh.PD dated 22.1.2004, according to which six kanals land was alienated from village Dengal at the rate of Rs,26033/- per marla. He further referred Exh.PE dated 15-7-2003, according to which eight marlas land from village Kathar was sold at the rate of Rs,75,000/- per marla. He further referred Exh.PC dated 12-6-2003, according to which twelve marlas land from village Behari was alienated at the rate of Rs,95,833/- per marla. He further submitted that if the average is determined from the aforesaid three sale-deeds, then the price of five kanals land comes to the tune of Rs,65,62,212/-. It was next contended by the learned counsel that a sale-deed was produced in evidence by the respondents, according to which, one kanal eleven marlas land situate in village Thara was alienated in lieu of Rs,6,00,000/-. The average rate of one marla comes to the tune of Rs,19,354/-. This sale-deed was executed on 13-8-2001, much before the issuance of the notification under section 4 of the Land Acquisition Act. The learned counsel submitted that Thara is quite adjacent to the village Basar and according to the aforesaid sale-deed dated 13-8-2001, the price of one marla land comes to Rs,19,354/-, while the land acquired by the Collector Land Acquisition was much better than the land situate in village Thara. Moreover it was situated near the road and the populated area. The potential value of the land was not kept in consideration by the Collector and the learned Additional District Judge (Reference Judge) while determining the market value of the land. He further submitted that the compensation was not assessed according to the recognized principles.
4. While controverting the arguments of the learned counsel for the appellant, Raja Fazal Hussain Rabbani, the learned Additional Advocate-General, submitted that the judgment of the learned Judge of the High Court is based on sound, cogent and tenacious reasoning. It does not require any indulgence by this Court. He further submitted that reasonable amount of compensation has been awarded to the appellant, therefore, this appeal has no merit at all.
5. We have heard the learned counsel for the parties, perused the relevant record and have given our utmost muse to the respective arguments advanced by the learned counsel for the parties.
6. The only question requiring determination in the instant case is whether the compensation has been determined accordingly by the lower Courts? It is to be noted that where the land is compulsorily acquired, the return proposed to be given in lieu of land to the owner is compensation, not the market value. Various matters have to be considered under section 23 of the Land Acquisition Act while determining the compensation of a land. Market value is one of such factors to be considered by the Collector or the Court. The word "compensation" has a very wide meaning. It has been elaborately discussed in the judgment by Mr. Justice Kayani, in the case titled M. Salimullah and others v. Province of West Pakistan and another PLD 1960 (W.P.) Lahore 450, who observed that the "compensation" means counter balancing, rendering of equivalent, requital, weighing one thing against another, but it does not mean weighing copper against gold, therefore, one cannot be compensated without requiting equivalent money. As such was held in the aforesaid report, which reads as under:--- "13. It was held by one of us in Malik Khizar Hayat Khan Tiwana v. Punjab Province (PLD 1955 Lah. 88) that "compensation" means the rendering of "an equivalent in money", and when it was argued that the omission of the word "just" or "equitable" as an adjective qualifying "compensation" could suggest that compensation need not represent the full money equivalent, the reply was that- ' That is a notion too preposterous for words. Indeed I am not going to say, for the benefit of a head-note in a law journal, that `compensation means just compensation', for it means neither more nor less than what it means to the English language. It means `counter-balancing, 'rendering of equivalent 'requital', `weighing one thing against another '(Oxford Dictionary Volume II), but it does not mean weighing copper against gold. Therefore, you cannot compensate a man without requiring him for his 'land', without the rendering to him of an equivalent in money. If the Government acquire the Shah Din Building on The Mall for twenty-five rupees, will the owner be compensated? Then if the Court is not to decide whether a person has been 'compensated' under section 299, and the reference to the District Court is also excluded by the amending Acts, let it not be said in this new era of freedom and consciousness that this is a fundamental principle of British Jurisprudence and International Law; let us not profane the Fundamental Rights of Man.
' The use of the word 'just' or 'adequate' with 'compensation' is, I shall permit myself to say, a tautological aberration.'
14. And the Supreme Court in Jibendra Kishore's case PLD 1957 SC 9 made more or less similar observations in relation to. Article 15 of the Constitution of 1956, which corresponds to section 299 Government of India Act. Their lordships quoted the following passages from Nichol's Eminent Domain: `Compensation as used in the constitutional provision as a limitation upon the power of eminent domain, implies a full and complete equivalent (usually monetary) for the loss sustained by the owner whose land has been taken or damaged'." (Underlining is ours)
7. It would not be out of place to mention here that the market value of the land at the time of notification under section 4 of .The Land Acquisition Act was merely one of the modes for determining the compensation and was not absolute yardstick for the assessment of compensation. Various matters have to be considered while determining the compensation. This view finds support from a case reported as Province of Sindh v. Ramzan and others PLD 2004 S.C.
512, wherein it has been observed as under:- "7. The most important aspect qua the lands compulsorily acquired is that the mandatory return proposed to be given to the landowner is the compensation and not the market value. Very section 23 provides for various matters to be brought under consideration while determining compensation. Market value is only one of such matters to be considered by the Collector or Courts. Compensation is a very wider term indicating that the landowners, for various reasons, is to be compensated and not merely paid the price of land which is just an interaction of supply and demand fixed between a willing buyer and willing seller.
8. Section 23 was subsequently amended through West Pakistan Ordinance XLIX of 1969 whereby the ambit of matters to be considered was widened and it was in this background that the Courts in the country emphasized the phenomenon of potential value of the land. This term potential value is only a one word used for the future uses which the land can be put to. In Malik Aman's case (PLD 1988 SC 32) this Court had explained the feature of potential value and had differentiated the same from the term 'market value'. It was held that market value was normally to be taken as one existing on the date of Notification under section 4(1) of the Land Acquisition Act under the principle of willing buyer and willing seller while the potential value was explained to be one to which the similar lands could be put to any use in future. Factors for determinin compensation of land are not restricted only to the time of the aforesaid Notification but can also relate to period in future and that is why in a large number of cases the 'potential value' has been held to be a relevant factor.
9. This Court had also taken notice of the fact that the announcement of award is sometimes unreasonably delayed after the issuance of Notification under section 4 of the Act. In Malik Aman's case, the period that had elapsed was seven years. Obviously any escalation in the value of property during such period is a potential value of land which must be taken into consideration.
10. Similar view was taken by this Court in Land Acquisition Collector Abbottabad v. Muhammad Iqbal (1992 SCMR 1245 at 1255). In the case of Pakistan Burmah Shell (1993 SCMR 1700), it was once again reiterated that consideration of market value at the time of Notification under section 4 of the Land Acquisition Act was merely one of the modes for ascertaining the market value and was not absolute yardstick for assessme nt of compensation. Numerous matters to be considered for determining compensation were elaborately laid down by this Court in Murad Khan's case (1999 SCMR 1647) which was again relied upon in Nisar Ahmed's case (PLD 2002 SC 25). The crux of the matter is that mere classification or nature of land may be taken as relevant consideration but not as absolute one. An area may be `Banjar' or 73arani' but its market value may be tremendously high because of its location, neighborhood, potentiality or other benefits. All these factors, therefore, cannot be ignored." (Underlining is ours)
8. It is the fundamental duty of the Court to also assess the potential value of the property. Factor regarding determination of the market value of land is restricted only to the time of issuance of notification or any period prior to it, but can also relate to the period in future. It is for this reason that the potential value of the land i.e,, the use to which it could be put in future, should also be considered. The schedule of average price of 3 years or even for one year is not the only criterion for determining the amount of the compensation, but the other material brought on record is also quite relevant. Mere one year's average price of the land in the same vicinity or mere classification, nature and kind of land may be taken as relevant consideration, but not as an absolute. An area may be Tanjar' or Tarani% but its market value may be higher than `Mera-Awal' or "Hail" due to its location, neighborhood and potentiality etc.All these factors have to be considered while determining the market value of the land. The other considerations have also been provided in the law, which would also be relevant for determining the market value of the land of owners whose land has been compulsorily acquired. Section 23 subsection (1) of the Land Acquisition Act provides that the Court shall take into consideration the market value of the land, loss by reason of severing such land from the other land, acquisition injuriously affecting the other property or earnings in consequence of change of residence or place of business and damage, if any resulting from diminution of the profits of land between the time of the publication of declaration under section 6 and at the time of taking possession of land by the Collector. This, however, is not exhaustive of other injuries or losses, which may be suffered by an owner on account of compulsory acquisition.
9. Where the lands are not transferred through mutual negotiation, but under the power of State conferred upon it and the land owners are deprived of their land, then they are entitled to maximum possible benefits. Courts have to be liberal and generous in fixing the quantum of compensation based on different considerations so that neither the land owner is deprived of his due right nor the acquiring agency is unduly burdened in the transaction. This view finds support from a case reported as Nisar Ahmed Khan and others v. Collector Land Acquisition Sawabi and others PLD 2002 SC 25 wherein it has been observed as under:-- ' Indeed the land owners are entitled to maximum possible benefit in the circumstances of each case for the reason that such lands are acquired not by way of mutual negotiations but under the State power conferred on the public functionaries. Courts are, therefore, always liberal and generous in fixing the quantum of compensation based on different considerations so that neither a land owner is deprived of his due rights nor the acquiring agency is unduly burdened in that behalf. Obviously, under the provisions of the Act, private lands are acquired for public purpose without the consent of the owners and the paramount consideration behind the scheme appears to be the welfare of the people at large. The object behind the legislative dispensation is not to deprive the land owners of their constitutional right to acquire, hold and dispose of property.
Subject to Constitution and with reasonable restrictions, such rights are guaranteed under Articles 23 and 24 of the Constitution, stipulating that no person shall be deprived of his property save in accordance with law and no property shall be compulsorily acquired for a public purpose except by the authority of law, which provides for compensation and either fixes the amount of compensation or specifies the principles on and the manner in which the compensation is to be determined and paid."
10. It is pertinent to note that while assessing the market value of the land, the land should not be valued merely by reference to use for which it was being made at the relevant time, but also the use for which it can reasonably be put in future. This view finds support from a case titled Faiz Akbar Khan and others v. Azad Government and others 1996 SCR 132 which reads as under:--- ' It may be pointed out that while assessing -the market value, the land is not to be valued merely by reference to the use for which it was being made at the relevant time but also the use to which it can reasonably be put in future. While dealing with the point, some judicial authorities opined as under:- ' In case reported as Fazal-ur-Rahman v. General Manager, S.I.D.B. PLD 1986 SC 158 it was opined as under:- ' There are other factors which have to be taken into consideration e.g. The land is not to be valued merely by reference to the use to which it is being put at the time at which its value has to be determined, but also by reference to the uses to which it is reasonably capable of being put in the future; and market-value is the potential value of the property at the time of acquisition which could be paid by a willing buyer to a willing seller, when both are actuated by business principles prevalent in the locality at that time.'
' It was further observed as under:- ' I may add that this salutary principle is often ignored by the functionaries of the Government while assessing the amount of compensation to be awarded to the persons whose land is compulsorily acquired. The principle that the use to which the land is capable of being put, to the advantage of the owner, is a factor which ought to be considered by the assessing authority, has been enunciated in a number of cases. For instance in Cedar Rapids Manufacturing and Power Co. v.
Lacoste (1914) AC 569, it was held that although any advantage which accrues due to the carrying out of any scheme for which the property is acquired, may be excluded, but while assessing the value of the acquired land, the probable use to which the owner might have put the land, must be taken into consideration. This includes all the advantages which the land possesses, present or future, in the hands of the owner and he is entitled to have the price assessed in reference to these advantages.'
' In Water and Power Development Authority, Lahore v. Damarud-Din 1992 CLC 258, dealing with the question of compensation, it has been observed that although the land acquired at the relevant time was used for agricultural purposes, yet it had the potential for being a site for residential or a commercial purpose. It has been further observed that the land was situated near the city; there was also a Degree College and a workshop; these factors should have been considered while fixing the market value of the land."
' The aforesaid view further finds support from another case titled Government of Pakistan v.
Muhammad Shafi Khan and 4 others 2000 YLR 3058 which reads as under:- ' However the High Court ultimately observed that as pointed out by the District Judge that the land was on the road side and has very potential value for commercial purposes under these circumstances the request of Government of Pakistan for reduction of amount of compensation awarded by the District Judge cannot be considered. The High Court also observed that there is a scarcity of land in Azad Kashmir, the owners are not prepared to part with the land. In very small towns or the localities near the towns, the price of land is very high, however the registration of sale-deeds is very rare, therefore, the real market price can hardly be proved. In the locality, like Hallan Janoobi, the award of Rs,27,000/- per kanal is reasonable and not excessive."
11. It would not be out of place to mention here that while determining the compensation, the Court has not only to fix the compensation according to the market rate at that particular time, but it has also to keep in consideration the future value of the land. In the instant case, while determining the compensation of the land, the potential value of the land has not been considered by the lower Courts. The present land is situated near the road and in populated area. As such has been stated by the witness of respondents, Muhammad Mehrban, Junior Clerk, Girls High School Biharri Basar, who deposed in the cross-examination that the land is on the southern side of the school and the road is on the northern side of the land. There are about four or five houses at the distance of 20 yards from the land. Muhammad Arif was produced as a witness by the appellant. He clearly deposed that the land is situated on the roadside and the road is on northern side of the land. This portion of his statement was not challenged in the cross-examination, thus it stands admitted.
Arshad Hussain, witness for the appellant, also stated that the land is situated on the northern side of the road and the population is quite near to the land just at a distance of few yards and this land was the only source of income of the appellant. This portion of his statement was not challenged in the cross-examination. Abdul Aziz, appellant, also appeared as a witness. He also deposed that his source of income was this land and the road is situated on the northern side of the land. He also deposed in the cross-examination that the land is situated in the populated area. These important aspects have not been considered by the Collector and the learned Reference Judge while determining the compensation of land and even the potential value of the land has also not been considered. As the land in the instant case is situated on the roadside and near the populated area, therefore, it has potential value, which was not considered by the lower Courts.
12. According to aforesaid witnesses the land is situated near the road and in populated area, therefore, while determining the compensation of land, the Court should have also considered the future value of the land. As stated above the future value of the land has not been considered by the lower Courts. Even the average of one year submitted by Patwari did not contain the market value of the land at the time of sale-deeds, but it contains the dates of sanction of mutation which is not permissible under law. It would be appropriate to mention here that a sale-deed dated 13-8- 2001 executed before the issuance of the notification under section 4 of the Land Acquisition Act was produced in evidence by the respondents, according to which, the market value of one marla of land comes to the tune of Rs,19,354/-. This sale-deed was executed on 13-8-2001 approximately eight months before the issuance of the notification under section 4 of the Land Acquisition Act and the market value of the land even before the issuance of the aforesaid notification was Rs,19,354 per marla. This document was produced in evidence by the respondents and they are bound by their evidence. Thus keeping in view the following factors, it can safely be said that the price of the land has not been fixed properly:-
(i) the land was not being sold by the appellant through negotiation, but it has been compulsorily acquired by the respondents through force of law;
(ii) the potential value of the land has not been considered;
(iii) according to evidence the land is situated near the road and in populated area; and
(iv) even the respondents produced a sale-deed regarding land adjacent to the land of appellant, which was sold at the rate of Rs,19,354 per marla. This land was alienated before the issuance of notification under section 4 of the Land Acquisition Act. When the respondents have placed reliance on the said sale-deed, then they are bound by their evidence.
' Therefore keeping in view the potential value of the land and the circumstances under which it was acquired by the respondents compulsorily, the price of land at the rate of Rs,19,354/- per marla along with 15 % compulsory acquisition charges shall be sufficient to meet the ends of justice.
The compendium of above discussion is that this appeal is accepted and the judgments of the lower Courts are set aside. The compensation of the land acquired by the respondents is fixed as Rs,19,354/- per marla along with 15% compulsory acquisition charges. The appeal stands disposed of in the terms indicated above.