SOHAIL NASIR J. A piece of land measuring 10-Kanals, 14-Marlas and 9-Yards situated at Moza Bhini Tehsil and District Multan admittedly was under the ownership of Malik Saleem Ullah and five others/private respondents. This land was the part of total land measurin g 673-Acres, 3-Kanals and 2-Marlas situated in the same vicinity . The governing body of the Multan Development Authority (MDA) decided to launch a housing scheme named 'Fatima Jinnah Town' at Vehari Road, Multan. The above said land for this purpose was acquired by the District Officer (Revenue) at the expenses of MDA/Acquiring agency . In terms of Section 4(1) of the Land Acquisition Act, (I of 1894) {Act} a notification was published in the Official Gazette on 16.02.2004. Later on a corrigendum notification was also issued on 28.07.2004 (R1) and published in the official gazette on 05.08.2008. Subsequent thereto under Section 17(4) read with Sections 6 and 7 of the Act, another notification was issued on 26.06.2006 and published in the official gazette on 28.06.2006 (Part of R-3). Later on in exercise of the powers conferred under Section 11 of the Act, the Land Acquisition Collector/appellant No. 3 (LAC) on 28.04.2008 made an award number 02 of 2008 (R-5) . The land belonging to private respondents to the extent of 10-Kanals, 1-Marla and 24-Yards was declared as agricultural and the award was made @ Rs.9200/- (nine thousands and two hundreds) per Marla. Remaining land measuring 12-Marlas and 15-Yards was declared as residential and the award was made @ Rs.10000/- (ten thousands) per Marla. In addition thereto, 15% compulsory acquisition charges were also declared in favour of private respondents.
2. As the private respondents were not satisfied with the amount of compensation shown in the award hence on 03.09.2008 they approached the LAC Multan with a reference in terms of Section 18 of the Act which was forwarded to the Court (Senior Civil Judge [Judicial] Multan).
3. Appellants and the Province of Punjab through District Collector (respondent No. 7) were summoned by the learned Court and they turned up accordingly .1 2
4. MDA and LAC submitted their joint written reply where they defended the award and maintained that it was made by observing all the lawful requirements and they asked for dismissal of reference.
5. Respondent No. 7/defendant No. 3 in its independent written statement also defended the award.
6. Common plea by appellants and respondent No. 7 was that as private respondents had received the compensation without any protest so the reference was not maintainable.
7. From pleadings of the parties following issues were framed by the learned court.
I. Whether the reference petitioners have no cause of action and locus standi to bring this reference? OPR II. Whether the reference is not maintainable in its present form? OPR III. Whether the reference petitioners have already received the consideration? If so, up to what extent in terms of money? OPR IV. Whether the reference petitioner has not been adequately compensated through impugned award? OP A V. If above issue is proved in affirmative, what should be the actual extent of compensation to be paid to the reference petitioner? OP A VI. Relief.
8. In evidence, Malik Muhammad Akbar (Aw-1) , Nazir Ahmad (Aw-2), Muhammad Saleem Malik/special attorney of private respondents (Aw-3) , Abdul Qayyum Director Estate (Aw-4) , Muhammad Arif Patwari (Aw-5) , Ghulam Mustafa (Aw-6) , Mazhar-ul-Haq Senior Clerk (Aw-7) and Chaudhary Zulfiqar Ahmed Junior Clerk (Aw-8) attended the witness box on behalf of private respondents who also produced the documents Ex.A-1 to A-9 & Mark-A.
9. On behalf of appellants and respondent No. 7, no oral evidence was produced. Appellants brought on record the documents Ex. R-1 to R-12 whereas respondent No. 7 relied on the documents Ex.R-13 to R-18.
10. During proceedings pursuant to an application submitted by private respondents, statement of one Muhammad Aslam, Halqa Patwari was also recorded by the learned Court.
11. Vide judgment and decree dated 05.05.2018 passed by the learned court (Senior Civil Judge, Multan) , the reference was accepted and the outcome was as under: - Compensation was enhanced to Rs. 200000/- (two lacs) per Marla. In addition, it was directed that private respondents shall be entitled for 8% of compound interest. Compulsory land acquisition charges will remain intact. Amount of compensation received by private respondents will be adjusted while calculating the total amount of compensation.
12. Appellants being dissatisfied from the decision of learned court now have approached this Court through the instant appeal filed under Section 54 of the Act.
13. Two initial attacks made by learned Counsel for appellants are required to be resolved before merits of the case are discussed. Firstly it has been maintained that private respondents had already received the compensation without any protest therefore, they were estopped to file the reference. Secondly it has been argued that although Muhammad Saleem (Aw-3) came in witness box as a special Attorney of private respondents but he did not possess said qualification on the strength of any document.
14. Both the contentions are devoid of force. This Court in a latest pronouncement while referring Section 31 of the Act that relates to payment of compensation has observed as under: - "From bare reading of proviso to subsection (2) of section 31 reveals that the entire "Act", does not provide any particular mode, manner and method of protest by a claimant at the time of receipt of amount of compensation, awarded under Section 11 of the "Act", hence, the protest can be made either in writing or through reference under Section 18 of the "Act".
15. Record shows that all the receiving by private respondents were made in 2009 or 2010 and much earlier to that (03.09.2008) they had already filed the reference before LAC which means that they were not satisfie d with the compensation made in award.
16. We have examined the record of learned court and we find that the original special power of attorney is available which shows that all the private respondents had authorized Muhammad Saleem son of Sana Ullah (Aw- 3) to appear on their behalf in the reference.3
17. The fact that while making his statement Muhammad Saleem Malik (Aw-3) did not state in specific words that he was the attorney of private respondents, at the most is a technical attack but with no worth at all.
18. The power of attorney however , could not be exhibited when the statement was made by Muhammad Saleem (Aw-3), however , this omission was rectified when an application moved by private respondents was accepted on 14.03.2017 and the original power of attorney was permitted to be placed on file.
19. Reverting to the merits of the case, we have observed that on the question of ascertainment of compensation of the land acquired the parameters and consideration so have been settled which are formulated as under:- i. 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 of becoming Chahi land. ii. While determining the potentials of the land, the use of which the land is capable of being put, ought to be considered. iii. 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 prices on which similar land situated in the vicinity was sold during the preceding 12 months and not 6-7 years may be considered including other factors like potential value etc. iv. The best way to work out the market value is the practical method of a prudent man to examine and analyze 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 land. v. Under Section 23 of the Act in determining the amount of compensation the court shall take into consideration the market value, loss by reason of severi ng such land from his other land, acquisit ion injuriously affecting his other property or his earning in consequence of change of residence or place of busine ss and damage, if any, resulting from diminution of the profits of the land between the time of the publication of the declaration and the time of the Collector's taking possession of the land. vi. This, however , is not exhaustive of other injuries or loss which may be suffe red by an owner on account of compulsory acquisition. vii. 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(i) of the Act. viii. The next best method is to take into consideration the instances of sale of the adjacent lands made shortly before and after the notification. ix. No doubt, for determining the market value, classification or 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 may be tremendously high because of its location, neighbourhood, potentiality or other benefits. x. While determining the value of the compensation the market value of the land at the time of requisition/acquisition and its potentiality has to be kept in consideration. xi. 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. xii. 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. xiii. Worth has to be determined in a way as the value of the land in open market at the relevant time. xiv. 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 testimo ny alone and do not insist on the production of documentary evidence.
The credibility of such witnesses would, however , have to be kept in mind and it would be for the court in each case to determine the weight to be attached to their testimony . xv. It would be useful and even necessary , to examine such witnesses while determining the market prices of the land in questions because of the prevalent tendency that in order to save money on the purchases of stamp papers4 and to avoid the imposition of heavy gain tax levied 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. xvi. The sale deed and mutation entries do serve as an aid to the prevailing market value. xvii. The standard must not be subjective but objective. 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 .
20. By applying the above principles in the present case, we have noticed that the LAC was isolated while ascertaining the value of the acquired land as he did not follow the parameters settled time to time by the Courts on this subject. Admittedly , the land was acquired for a housing society where later on 5347 residential plots were developed as admitted by Abdul Qayyum Director Estate MDA (Aw-4) but this future perspective was complete ly overlooked. The principle of potential value also lost sight by LAC. Admittedly because of developing a housing society , not only the value of acquired land but the surroundings properties have to increase. LAC too missed that some of the surrounding lands were commercial in nature and that the land of priva te respondents was in Municipal limits which fact was conceded by Muhammad Arif Patwari (Aw-5) who had produced the record. Even the LAC had closed his eyes that in recent past from the date of acquiring the land, for what consideration a willing seller had sold his/her property to a willing buyer .
21. Private respondents had produced good number of documents to show that at the relevant time the value of the surroundings lands were much higher when compared with the value of acquired land shown in the award. The following table is relevant in this context: - S. NoExhibit Date of saleNature of land (Residential or Commercial)Area of landPrice 1 A-2 20.03.2004 Commercial 1-M & 20-Y 300,000/- 2 A-3 11.11.2000 Commercial 51/2 -M 800,000/- 3 A-4 09.01.1999 Commercial 1-M & 3-Y 1,35,000/- 4 A-5 10.10.2003 Residential 5-M 1,30,000/- 5 A-6 18.06.2004 Residential 2-M & 22-Y 90,000/- 6 A-7 12.05.2004 Residential 1-K & 3-M 900,000/- 7 A-8 23.06.2003 Residential 2-M & 1 1-Y 2,25,000/- 8 A-9 21.06.2003 Residential 1-M & 6-Y 1,15,000/-
22. It will not be out of context to refer here one of the referred principles (xv) that because of prevalent tendency that in order to save money on the purchases of stamp papers and to avoid the imposition of heavy gain tax levied 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. In the light of said principle one can understand that the sale prices depicted in the above table were not the one but more than that.
23. On the strength of documents produced by private respondents it has been established that the surroundings properties to acquired land were commercial and residential and were of excessive worth in terms of money when compared with the prices shown in the award made by LAC.
24. Although various documents have also been produced by the appellants but those are hardly relevant and sufficient to rebut the documentary evidence produced by private respondents.
25. The documentary evidence brought on record by private respondents is so strong in presence whereof there is no need to discuss the statements of Malik Muhammad Akbar (Aw-1), Nazir Ahmad (Aw-2) and Muhammad Saleem Malik/Special Attorney of private respondents (Aw-3).
26. The learned court through a detailed discussion made on oral as well as documentary evidence rightly interfered in the award made by LAC which was not only showing unfair value of the acquired land but was also in complete deviation to the principles settled by the Courts.
27. However learned counsel for private respondents does not dispute the legal proposition that the compound interest could not be imposed against the appellants.
28. In view of above circumstances while modifying the impugned judgment and decree to the extent that the private respondents shall not be entitled for compound interest, this appeal is hereby dismissed with no order as to the costs. Defined under Section 3(a) of the Act 2 Under Section 3(d) of the Act means principal Civil Court of original jurisdiction, and includes the Court of any Additional District Judge and any Civil Judge Federation of Pakistan vs. Nasir Munir Ahmed and others (https://sys.lhc.gov .pk/appjudgments/2022LHC1587.pdf) Land Acquisition Collector , G.S.C, N.T.D.C, (WAPDA), Lahore & another vs. Mst. Surayya Mehmood Jan 2015 SCMR 28; Murad Khan vs. Land Acquisition Collector 1999 SCMR 1647 ; The Land Acquisition Collector , Rawalpindi vs. Lieut. General Wajid Ali Khan Burki PLD 1960 (WP) Lahore 469; Province of West Pakistan & another vs. M. Salim Ullah & others PLD1966 SC 547; Pakistan & another vs. Rehm Dad & another 1980 CLC 574; Pakistan vs. Din Muhammad & others 1983 CLC 1281 ; Mst. Khatu & others vs. Barrage Mukhtiarkar , Thatta PLD 1977 Karachi 203; Din Muhammad vs. General Manager , Communication & others PLD 1978 Lahore 1135; Province of Punjab vs. Sher Muhammad & another PLD 1983 Lahore 578; Fazal-ur-Rehman & others vs. General Manager , S.I.D.B & another PLD 1986 SC 158; Government of Pakistan vs. Maulvi Ahmed Saeed 1983 CLC 414; Abdul Wahid & others vs. The Deputy Commissioner 1986 MLD 381; Province of Sindh vs. Ramzan PLD 2004 SC 512; Abdul Majeed etc. vs. Muhammad Subhan etc. 1999 SCMR 1245 and Pakistan Burma Shell Limited vs. Province of N.W .F.P. etc. 1993 SCMR 1700 ;