ABDUL REHIMAN KUNJU Vs. STATE

JUDGEMENT

(1.) The plaintiff is the appellant. 3.570 cents of land in S.No. 5 of the Iranimuttom Pakuthy were acquired by the State with the building standing thereon. The Land Acquisition Officer awarded compensation at Rs. 150 per cent for the land and Rs. 882/- for the building. The plaintiff applied for a reference to the District Court and the Additional District Judge enhanced the ground value to Rs. 300 a cent. He also made some increase in the value of the building. The plaintiff in appeal claims land value at Rs. 600 a cent and also Rs. 3,670 more for the building.

(2.) The plaintiff had not produced any documents relating to the sale of any neighbouring properties to enable the court to fix the market value of the property acquired. The State also did not produce any documents. It was stated that no contemporaneous documents relating to adjacent or neighbouring properties had come into existence. The lower court adopted a rough and ready measure to fix the market value, relying also on the admissions made by the witnesses regarding a bit of property for which Rs. 150 a cent had been awarded as compensation in 1115. But that award has not been produced in this case. The lower court proceeded on the admission of the parties. According to the lower court if the property could be valued at Rs. 150 a cent in 1115 it could be valued at Rs. 300 in 1120, when the property was acquired as the price of properties was going high. We think it proper to accept this.

(3.) As regards the building the Land Acquisition Officer as well as the lower court had adopted a peculiar way of making allowance for the depreciation of the building. The building in this case had a granite foundation, the walls were built of burned bricks though mud was used in place of chunnam for masonary works and the plastering was with chunnam and the wooden materials used consisted of Anjili, Teak and other hard woods. The building was said to be 35 years old. The PWD Officer who estimated the value fixed the price at Rs. 5,322/-. Then he deducted for each year 5 per cent for depreciation so that when deduction in that way was made the net result after 35 years brought the value of the building to Rs. 882. The lower court issued a commission to assess the value of the building. The commissioners found that Rs. 6,500-5-10 would be required to construct the building and they deducted 3/4ths on account of depreciation. This figure was not accepted by the lower court. The lower court however took into consideration the figure arrived at by the PWD officer who had been examined in this case as DW 1, and deducted 3/4th of the value for depreciation. The mode of valuation adopted by the lower court and the PWD Officer cannot be accepted. The Judicial Committee of the Privy Council in Hari Chand v. Secretary of State, AIR 1939 PC 235 laid down that where the subject to be valued was a building apart from site, the principle of fixing value by ascertaining the cost of reproducing the building at the present time and then allowing for depreciation in consideration of the age of the building and for the costs of such repairs as might be required apart from depreciation, was quite a well known and recognised method of valuing building for the purpose of compensation. This principle was again affirmed in Secretary of State v. Narain Khanna, AIR 1942 PC 35 and followed. So to arrive at the present value of the building, the proper course would be to find out the cost of constructing a building of this type at the time of the acquisition and then deduct from it the depreciation value on account of the age of the building and also the amount required for repairs to keep the building in a fit condition. It is true that nowhere in the Land Acquisition Act or rules framed thereunder has any rule been laid down relating to the deduction on account of depreciation. The natural way to look at the matter would be to find out the approximate number of years the building could be used with proper care and maintenance and then divide the total cost of maintenance by the number of years and deduct the quotient as depreciation for each year. Om Prakash Aggarawala in his commentary on the acquisition of land in India and Pakistan 3rd Ed. at p. 282, refers to the opinion of experts in making deductions of depreciation thus:-