G R RADHAKRISHNAN Vs. APPROPRIATE AUTHORITY

JUDGEMENT

(1.) THE petitioner is aggrieved by the order of the appropriate authority directing the pre-emptive purchase of an immovable property located at Door No. 50, North Usman Road, T. Nagar, Chennai. THE property admeasures two grounds and 613 sq. ft. (5,413 sq. ft.). It has a 70 year old building. THE ground floor admeasures 1,941 sq. ft. and the first floor admeasures 717 sq. ft. THE property was agreed to be sold for a sum of Rs. 1,20,00,000 as per the agreement dated March 7, 1997.

(2.) AFTER the petitioners filed Form No. 37-I, the appropriate authority issued a show-cause notice to them asking them to show cause as to why the property should not be pre-emptively purchased, as according to the authority, though the property is a residential building, it falls in a mixed residential zone as per the proposed master plan of the MMDA and the entire stretch of the front row are classified as commercial and the property would continue to have the same zone of classification and that the sale consideration of this property, as agreed between the parties compared with the sale realisation from sale of property at No. 33, North Usman Road which was auctioned by the Revenue on June 12, 1996, there was an undervaluation to the extent of 38.558 taking the discounted consideration under the agreement between the parties as Rs. 1,27,27,132. The property at No. 33, North Usman Road, had been purchased by the appropriate authority in February, 1994, and in the auction conducted by it on June 12, 1996, the property fetched a sum of Rs. 1,18,00,000. That property was also located on North Usman Road, but was away from Panagal Park, it consisted of land admeasuring 4,164 sq. ft. with a double storeyed building with a plinth area of 7,325 sq. ft., that building" having been constructed during 1987. That was also a corner property having 50 ft. frontage on North Usman Road and 77 ft. frontage at Bharathi Nagar II Street and falls in the same development zone.

(3.) WHEN two things are sought to be compared, it is necessary that the things are in fact comparable. WHEN plots with buildings thereon are compared, the buildings cannot be treated as scrap, irrespective of their age, the amount invested in putting up the construction, the present depreciated value and the potential for further use of the building. The building cannot be treated as scrap solely with a view to make the land on which that building had been put up comparable as land. The buildings which are put up at enormous cost are normally meant for use for several decades. The ownership of the buildings need not be hand in hand with the ownership of the land. Even where land is held by one, the building can be owned by another. For the purposes of ascertaining the value of the land on which the building had been put up, normally the depreciated value of the building is required to be deducted from the total consideration paid for the property. The exception would be cases where it is clearly established that the price paid for the property is in fact the price paid for the land and scrap value of the building.