FABRICS PRIVATE LIMITED Vs. SPECIAL LAND ACQUISITION OFFICER KAIRA
LAWS(GJH)-1970-10-5
HIGH COURT OF GUJARAT
Decided on October 15,1970

FABRICS PRIVATE LIMITED Appellant
VERSUS
SPECIAL LAND ACQUISITION OFFICER,KAIRA Respondents


Referred Judgements :-

BOMBAY IMPROVEMENT TRUST V. MERVANJI MANEKJI MISTRY [REFERRED]





JUDGEMENT

P.D.DESAI - (1.)* * * *
(2.)We shall now turn to the next objection raised by the learned Government Pleader against the sale instance evidenced by Ex. 34. As stated above whereas the lands under acquisition consist of a large block of land admeasuring 44 acres 37 gunthas owned by a single owner the sale transaction of S. No. 619 evidenced by Ex. 34 is in respect of a comparatively much smaller piece or parcel of land admeasuring 1 acre 25 gunthas. It is well known contended the learned Government Pleader that small plots generally fetch a higher value than large plots and therefore transactions of sale of small plots can afford no real assistance when a large plot has to be valued. There could therefore be no comparison between the valuation of S. No. 619 and that of the acquired lands and the said transaction cannot in the submission of the learned Government Pleader be regarded as a comparable sale instance. It was therefore urged that it could not be said that the claimant had discharged the burden of proving that the compensation offered to him was inadequate and that the Court was not justified in awarding enhanced compensation to the claimant for the acquired lands.
(3.)It is true that the size of a plot of land will have very important bearing on its value. It would be impossible to say that a sale transaction of a large block of land stands on the same footing as that of a small piece or parcel of land. Ordinarily therefore a large tract of land cannot be valued on the same basis as a small plot of land. The reasons therefore are obvious. The number of intending purchasers competing for the purchase of a small plot would be far greater than that for a large plot with the result that the seller of a small plot is likely to obtain a relatively higher price than the seller of a big plot of land. Furthermore when a small plot is purchased the actual rate at which it is purchased may not be very carefully or properly scrutinised the whole cost of purchase being small. An increase of a rupee or even more per square yard in such a case may not materially add to the costs of purchase and the intending purchaser may not therefore grudge paying a little higher price for a small plot. The investment which would be required to be made in the purchase of a large plot land would be relatively very much higher and the risk which the purchaser of such a plot undertakes would in its magnitude be also great. It is well known that a person who has to sell a large tract of land may not be able to sell it all at once unless there is a brisk market and keen demand for the lands in the locality and as such also the market value of such land would be less. If the intending purchaser of a very large plot of land enters into the transaction with the idea of parceling it out into small plots and selling it to different purchasers he takes into account the cost of development which may have to be incurred in demarcating the plots deducing the area for accommodation laying the roads providing for water and electricity supply and other amenities and in otherwise making the smaller plots marketable - He has also to provide for the costs which may have to be incurred on advertising the project paying commission to land agents and brokers and conveying such a large number of small plots to different buyers. He has also to make allowance for the loss of interest on the investment made in the purchase of large plot because some period of time is bound to elapse before all the small plots may be sold and he must also contemplate the possibility of some of the smaller or inferior plots remaining unsold altogether thus lessening the average price which the owner of the plot would get on the plots already sold. And lastly the person floating such a development scheme with all the labour loss of time and risks involved in it is bound to provide for his own profit at a reasonable rate after making due provision for the costs that may have to be incurred as aforesaid Such a purchaser will not therefore pay a high price for the large plot of land and the price at which he may ultimately sell the small plots is bound to be relatively higher than the price that he had paid for the whole block of land. Having regard to all these diverse factors and considerations it is a well recognised principle of valuation of lands not to value large areas of land on the basis of sales of small areas without making suitable deduction from sale price of small plots of land on account of the largeness of the size of the land sought to be evaluated with reference to the said small plots.


Click here to view full judgement.
Copyright © Regent Computronics Pvt.Ltd.