2020 PLP 1799 (YLR)

AGHA FAISAL, J.

The subject matter of these appeals is the issue of compensation payable in respect of the Lyari Expressway Project ("Project"). The land acquisition officer had delivered awards dated 16.05.2015 and 19.05.2015 ("Awards"), with respect to the acquisition of property in Angara Goth Liaquatabad and 'A'-Area Liaquatabad, respectively. The Awards came before the Referee Court, being the IInd Additional District Judge, Karachi-Central, and vide judgment dated 13.07.2016 in Reference Nos.1, 2 and 10 of 2016 ("Impugned Judgment") the Court was pleased to re-determine the said compensation. The present appeals have been preferred challenging the Impugned Judgment. Since the controversy is common to all three appeals, hence, they shall be determined vide this common judgment.

2. The facts relevant to the present controversy pertain to the acquisition of land for the Project. The record shows that the preliminary notification in respect of acquisition of land, under Section 4 of the Land Acquisition Act, 1894 ("Act"), was issued on 11.02.2013, followed by the notifications under Sections 6 and 7 of the Act dated 11.05.2013, which were published in the Sindh Government Gazette on 23.05.2013. The Awards, under Section 11 of the Act, were rendered on 16.05.2015 and 19.05.2013 respectively, wherein the quantum of compensation stood determined. It is considered appropriate to reproduce the relevant findings, and the basis thereof, recorded in the respective Awards. Angara Goth Section 11(ii) of the Land Acquisition Act, 1894 stipulates that the Collector has to form an opinion about compensation for the land to be acquired. The compensation is to be fair and reasonable. To determine the fair value of the land in question it was pertinent to assess its market value. The Hon'ble Supreme Court of Pakistan had laid down in a judgment that the value of land and bungalows in registered documents cannot be relied upon (PLD 1986 SC 158). However, they were consulted to formulate an idea about the true value of land. It was essential to consider the opinion of the estate and property dealers of the area about the value of land in question. Also, other factors such as environment of the area, availability of civic amenities and infrastructure were also considered. Being on the beds of Lyari River -- which serves as main sewer carrier of Karachi, the area is not desirable for real estate development. Hence, the expectation that the value of land will increase significantly in years to come is negligible. Essential civic amenities are not available in the area. The area lacks municipal infrastructure such as paved roads, streetlights etc. Being a 'Katchi Abadi', the structures are unplanned and to a certain extent dangerous. The land was given on lease by the Karachi Metropolitan Corporation for a period of 99 years. By doing so, Karachi Metropolitan Corporation regularized and recognized the right of encroachers on state land. It is taken into account that the bed of Lyari River is an natural endowment and no individual person can claim ownership or right of exclusive enjoyment of benefits driven from the same. To ensure a transparent evaluation, all persons interest in the land in question were heard and enquired about their expectations about its value. However, they failed to present a just and reasonable evaluation of the land to be acquired. Their evaluation was exaggerated and devoid of ground realities. All the factors affecting the value of land in question were taken into account. Value of Constructed Structures: The valuation of constructed structures, was a technical issue. Therefore, assistance of an expert was sought. The Chief Engineer of Karachi Metropolitan Corporation made the assessment. Hence, no ambiguity remains as to the values of constructed structures. Being satisfied that the principles of natural justice, the requirements of Land Acquisition Act, 1894 and the orders of Hon'ble Supreme Courts are complied with I do hereby award, amount as per the statement attached herewith (list-A), as compensation for the acquisition of 1551 square yards of Angara Goth, Liaquatabad, Karachi. 'A'-Area Section 11(ii) of the Land Acquisition Act, 1894 stipulates that the Collector has to form an opinion about compensation for the land to be acquired. The compensation is to be fair and reasonable. To determine the fair value of the land in question it was pertinent to assess the market value. The Hon'ble Supreme Court of Pakistan had laid down in a judgment that the value of land and bungalows in registered documents cannot be relied upon (PLD 1986 SC 158). However, they were consulted to formulate an idea about the true value of land. It was essential to consider the opinion of the estate and property dealers of the area about the value of land in question. Also, other factors such as environment of the area, availability of civic amenities and infrastructure were also considered. It was observed during the inspection of the land that: The majority of the construction is haphazard and without planning. The constructed structures are dangerous as they have been built without planning. The environment of the area adversely affects the lives of the residents. The area lacks amenities and is not desirable for future development. The land in question has been leased by Karachi Metropolitan Corporation, Karachi. As per the report of Assistant Director (Rev.) Land Lease Liaquatabad, KMC. The lease of following plots situated on the land to be acquired has expired: S. No. Lessee Plot No. Period and Year of Lease 01 Hameeda Bano 4/36 'A' Area 30 years from 1965 02 M. Rafique 1/36 'A' Area 30 years from 1967 03 Khurshid Ahmed 2/35 'A' Area 30 years from 1967 04 Hakim 4/21 'A' Area 30 years from 1967 Also, from the said report, it transpired that no lease was ever issued by the Karachi Metropolitan Corporation in respect of the following plots situated on the land to be acquired: S. No. Claimant Plot No. Status of Land 01 Mahmood Baig 2/2-B 'A' Area Un-leased 02 Abdur Rehman 2/36 'A' Area Un-leased 03 Noor Muhammad 6/30 'A' Area Un-leased 04 Kulsoom 7/30 'A' Area Un-leased As far as, un-leased plots and plots with expired lease are concerned the occupants have been drawing benefits without any lawful right. Hence, the only compensation the occupants can demand is the cost of construction. To ensure a transparent evaluation, all interested in the land in question were heard and enquired about their expectations about its value. However, they failed to present a just and reasonable evaluation of the land to be acquired. Their evaluation was exaggerated and devoid of ground realities. All the factors affecting the value of land in question were taken into account. Value of Constructed Structures: The valuation of constructed structures was a technical issue. Therefore, assistance of an expert was sought. The Chief Engineer of Karachi Metropolitan Corporation made the assessment. Hence, no ambiguity remains as to the value of constructed structures. Being satisfied that the principles of natural justice, the requirements of Land Acquisition Act, 1894 and the orders of Hon'ble Superior Courts, are complied with I do hereby award, amount as per the statement attached herewith ___ (List-A) as compensation for the acquisition of 4157 square yards of 'A' Area, Liaquatabad, Karachi. The affectees disputed the quanti-fication of compensation undertaken vide the Awards and eventually the dispute came before the Court in the form of references under Section 18 of the Act. The learned Referee Judge came to the conclusion that the amount of compensation granted to the affectees was not fair and reasonable, hence, re-determined the same. The operative findings contained in the Impugned Judgment are reproduced herein below: "Keeping in view the settled law I have assessed, determined and evaluated the evidence led by the parties through oral as well as documentary evidence. There is no denial of the fact that both the properties situated at A Area and Angara Goth are situated in thickly populated and congested area as per contents of both awards dated 15.5.2015 and 19.5.2015 which are faced with almost all the civic facilities of present days viz electricity, Sui Gas, water connection, proper sewerage system, road, etc. The witness of the plaintiff Syed Sajjad Mustafa has produced assessment valued as per survey reports produced by him which are appearing to be nothing but are imaginary as in cross-examination he has admitted that he has not obtained any document of ownership from any inhabitant of the locality and even he has shown his ignorance of about present market value of the construction as per square feet therefore it cannot be ascertained as to how he assessed the amount as he has not produced any concrete proof with regard to its proper valuation. The evidence of Estate Agent Muhammad Nazim in fact goes in favour of objectors/defendants rather in favour of plaintiff as he has admitted almost each and every suggestion of learned advocate for objectors/defendants while the evidence of Deputy Commissioner Karachi Central is also of no help to his case. He has deposed that the notices under section 9 of the Act were issued to the occupants through TCS and he has produced P.S. copies of TCS receipts with the notices but the delivery receipts are not produced showing that actually the notices were served upon the objectors/ defendants and even from perusal of notices and TCS receipts it appears that the addresses shown on them are neither complete nor proper therefore it can be said that the notices were not properly served upon the occupants of the properties in question. So far as rate of land in question is concerned the evidence of objectors/ defendants and their witnesses is also imaginary because they have also not produced cogent evidence with regard to present market value of the properties in question and now there remains evidence of Commissioner namely Mr. Hassan Imam Advocate, the Retired District and Sessions Judge who has remained well reputed Judge in District Judiciary and he inspected the site in presence of parties and has submitted his report along with photographs and information obtained from Estate Agencies in respect of market value of the properties in question. The learned advocate for the plaintiff has filed objections to his report but the same are not material therefore they cannot be considered and I have no reason to disbelieve the report of Commissioner which appears to be proper. As stated in preceding paragraphs Land Acquisition Officer fixed the price of land at his own accord without any documentary evidence and his witnesses have also failed to produce any concrete evidence with regard to value assessed by him. It may be noted here that while determining the compensation the following factors are to be considered as provided in Section 23 of Land Acquisition Act, 1894 which is reproduced as under:-

23. Matters to be considered in determining compensation: (1) In determining the amount of compensation to be awarded for land acquired under this Act, the Court shall take into consideration

First, the market-value of the land at the date of the publication of the notification under Section 4, subsection (1), secondly, the damage sustained by the person interested, by reason of the taking of any standing crops or trees which may be on the land at the time of the Collector's taking possession thereof; thirdly, the damage (if any) sustained by the person interested, at the time of the Collector's taking possession of the land, by reason severing such land from his other land; fourthly, the damage (if any) sustained by the person interested, at the time of the Collector's taking possession of the land, by reason of the acquisition injuriously affecting his other property, movable or immovable, in any other manner, or his earnings; fifthly, if, in consequence of the acquisition of the land by the Collector, the person interested is compelled to change his residence or place of business, the reasonable expenses (if any) incidental to such change, and Sixthly, the damage (if any) bona fide resulting from diminution of the profits of the land between the time of the publication of the declaration under Section 6 and the time of the Collector's taking possession of the land. (2) In addition to the market-value of the land as above provided, the Court shall in very case award a sum of fifteen per centum on such market-value, in consideration of the compulsory nature of the acquisition. From the overall assessment of the evidence and material available on record I am of the considered view that the Land Acquisition Officer/Deputy Commissioner Central has not passed awards in favour of effectees by examining their cases separately therefore amount of compensation granted to the objectors/defendants is not fair and reasonable amount as per existing market value. Hence both these Issues are answered in Negative. Issue No.3 On the basis of my above discussion I am of the humble view that the report of Commissioner is just and equitable who has assessed the properties in question and determined the amount of compensation fairly and reasonably therefore while agreeing with the assessment of the amount of compensation determined by the Commissioner the three objectors/defendants whose houses are situated on the service lane of Shara-e-Altaf in A-Area Liaquatabad are awarded amount of compensation at the rate of Rs.38000/- per square yard while the remaining objectors/defendants whose houses are situated in same area in narrow streets in between water stream and Shara-e-Altaf are awarded amount of compensation at the rate of Rs.25000/- per square yard while the objectors/ defendants whose houses are situated in Angara Goth are awarded amount of compensation at the rate of Rs.24000/- per square yard. The objectors/defendants are also entitled for allowance as admissible under the law. The plaintiff is directed to issue fresh cheques of amount of compensation in the names of objectors/defendants within one month without fail. The above Reference in terms of above increase are disposed of accordingly." Aggrieved by the Impugned Judgment, the appellants preferred the present appeals.

3. Mr. Jawad Dero, learned Additional Advocate General appeared on behalf of the appellants and submitted that the Impugned Judgment was predicated upon a commissioner's report and not upon any cogent evidence. Per learned counsel, the Referee Judge's reliance upon secondary information was unwarranted. Learned counsel submitted that it was imperative that the valuation relevant to the proceedings be benchmarked to the time at which the notice under Section 4 of the Act was issued and the same was not done. Learned counsel argued that the Awards had considered all material aspects and the findings therein were predicated upon the correct assessment of the facts and circumstances, hence, it was imperative that the Impugned Judgment be set aside and the Awards be restored.

4. Mr. Shoukat Ali Shaikh, learned counsel for the respondents at the very onset challenged the maintainability of the present appeals, on the premise that the present appellants were not the proper party/ies to have assailed the Impugned Judgment. Learned counsel argued that the uniform formula / offer for the constituents of the land acquisition was earlier challenged before this Court in Constitution petitions and the said petitions were disposed of with directions to the respondents to pass award in respect of each petitioner fairly and reasonably and that the same had demonstrably not been done in the Impugned Judgment. Per learned counsel, the requisites for a declaration required under Section 6(1-A) of the Act had not been complied with; the recommendations of the commissioner were not adopted by the Referee Judge; and the determined values were significantly lower than proposed by the commissioner.

5. We have heard the arguments of the respective learned counsel and have also considered the documentation to which our surveillance was solicited. It is observed that both sides to the present appeals have expressed reservations about the Impugned Judgment and that neither side considers the same to have been rendered in consonance with the law. In conformity with the prescription of O. XLI, Rule 31, C.P.C., we do hereby frame the following points for determination: i) Whether the present appeals are maintainable. ii) Whether the quantification of compensation concluded vide the Impugned Judgment is sustainable upon consideration of the basis upon which the same was predicated.

6. The issue of maintainability merits deliberation at the very onset, as the respondents had challenged locus standi of the present appellants to maintain the present appeals. It was contended by the learned counsel for the respondents that the appeals ought to have been filed by the Deputy Commissioner Central, being the Land Acquisition Officer and not by the Province of Sindh and the Project Director, Resettlement Project Lyari Expressway/Deputy Commissioner South, Karachi, who have preferred the present appeals. Learned counsel for the appellants had sought to repel this challenge by submitting that at the relevant time, the person officiating as Deputy Commissioner South was also holding the office of Deputy Commissioner Central and Project Director, Lyari Expressway, therefore, the objection to maintainability was not sustainable. It was further submitted that in any event a beneficiary was entitled to file an appeal and that the said principal had been duly endorsed by the Superior courts.

7. Learned counsel for the appellants had drawn our attention to the judgment in the State of Maharashtra (Public Works Department) v. Babu Rao Dnyanoba Chiddarwar and others reported as AIR 1973 Bombay 231, wherein it was maintained that the collector, when he makes an award, does so on behalf of the government. It was also noted that while making the award, and also any proceedings antecedent thereto, he is functioning as an agent of the government and as collector he is not a person who has to pay compensation, which in any event is to be paid out of funds of the government. It was thus recognized that the real person interested in challenging the enhanced compensation is the principal, being the government itself. It was thus maintained that there was no impediment to the beneficiary, being the government itself, filing an appeal in respect of an order / judgment whereby the quantum of compensation was enhanced by the Court.

8. The honorable Supreme Court has also recognized the eligibility of a beneficiary to file an appeal in the case of Land Acquisition Collector and others v. Muhammad Nawaz and others reported as PLD 2010 SC

745. The pertinent observations in such regard are reproduced herein below: "

7. It is pertinent to mention here that out of the aforesaid sections, sections 18(3) and (4), 22-A, 54 of the Land Acquisition Act as well as depriving a company or a local authority of the right of appeal in Proviso the Section 50(2) of the Act are repugnant to the injunctions of Islam as held by the Shariat Appellate Bench of this Court vide judgment dated 18-2-1991 in Shariat Appeal No.7/89. A cut-off date was fixed by the Shariat Appellate Bench for the competent bodies for necessary amendment in the aforesaid sections till 30-9-1991. The Shariat Appellate Bench further held as under: "The proposed amendments would advance remedy to an aggrieved party. It would be fair and just to give a right to make a reference, file a cross-objection, lead evidence and file an appeal to those parties who have been denied such a right under sections 18, 22-A, 50 and 54 of the Land Acquisition Act." As stated by the learned counsel for the parties that province of the Punjab had not yet amended the said provision in accordance with the directions of the Shariat Appellate Bench judgment dated 18-2-1991 in Shariat Appeal No.7/1989. According to Article 203-D, (3)(b) if any law or provision of law is held by the Court to be repugnant to the Injunctions of Islam, such law or provision shall to the extent to which it is held to be so repugnant cease to have effect on the day on which the decision of the Court takes effect. The aforesaid provisions mentioned herein above which were declared against the injunctions of Islam after 30th September, 1991. The aforesaid provision of Land Acquisition Act including provision of section 50(2) of the Act barring right of appeal to Federal Government/beneficiaries shall cease to have effect, therefore, now after the cut-off date the Federal Government/ beneficiaries have a right to file an appeal, as per judgment of the Shariat Appellate Bench."

9. The learned counsel for the respondents despite having argued that the appeals were required to have been instituted by the Deputy Commissioner South, made no attempt to controvert the assertion of the learned Additional Advocate General that at the time when the appeals were filed, the same person was officiating as the Deputy Commis-sioner Central, Deputy Commissioner South and Project Director, Lyari Expressway. The learned counsel for the respondents also did not seek to distinguish the Supreme Court's judgment cited supra, wherein right of a beneficiary to file an appeal was recognized. In view hereof, we are not persuaded to non-suit the appeals on the grounds of maintainability, hence, proceed to address the merits thereof.

10. The starting point of this exercise is to consider whether the basis of quantum of the compensation was reliable as argued on behalf of the appellants. It may be prudent to initiate this discussion by adverting to the order issued by a Division bench of this Court dated 15.05.2013, in C.P. D-60 of 2013 Muhammad Hanif and others v. Province of Sindh and others ("Muhammad Hanif"), directing the respondents to pass award in respect of each petitioner fairly and reasonably. Learned counsel for the respondents had argued that the aforesaid order clearly required the award to consider the individual constituents of the property sought to be acquired; whereas the Awards had not taken the said directions into consideration. The said grievance was brought to the attention of an earlier Division Bench of this Court, via applications preferred in the aforesaid case and connected petitions, and the learned Division Bench, vide judgment dated 03.11.2015, was pleased to maintain that grievances of such nature were to be determined via a reference pursuant to Section 18 of the Act, however, the respondents therein were directed to deposit the compensation cheques of the applicants, per quantification arrived at vide the Awards, with the Nazir of this Court.

11. The references were filed and the primary issue framed to be determined therein was whether the awards took into consideration the distinctive and mutually exclusive nature of the constituents of the land under acquisition proceedings. The learned Referee Judge decided the issue in the negative. The learned Additional Advocate General has not disputed the said findings in the arguments articulated before us. In view hereof it stands demonstrated that the Awards were discrepant in so far as they did not take into consideration the variation in the constituents of the area / land subject matter of the acquisition proceedings.

12. Learned counsel for the respondents had pointed out that the Impugned Judgment suffered from the same infirmity as the Awards, in so far as the Referee Court had not considered the distinguishing features of the constituents of the area / land subject matter of the acquisition proceedings. It was argued that property in the middle of the respective areas could not be determined to have the same value as that on the periphery / facing the main road. It was further argued that the distinctive value of dwellings was also not factored in while determining the valuation and the same was manifestly unjust. Learned counsel for the appellants did not controvert the apparent discord of the Impugned Judgment with the directions rendered in Muhammad Hanif and the said dissonance is also apparent from the record. This leads to the second issue, being whether the quantification of compensation concluded vide the Impugned Judgment is sustainable upon consideration of the basis upon which the same was predicated.

13. Learned Additional Advocate General had argued that valuation relevant to the proceedings was required to be benchmarked to the time at which the notice under Section 4 of the Act was issued. This contention appears negated by the Land Acquisition (Sindh) Amendment 2009 ("Amendment Act") whereby Sections 23 and 24 of the Act were amended and references therein to Section 4 of the Act were replaced with references to Section 6 thereof. Per the record placed before us the relevant notification in respect of acquisition of land, under Section 4 of the Act was issued on 11.02.2013 and the notification under Section 6 of the Act was issued 11.05.2013. There is no argument before us that any material change did or could have taken place in the intervening three months with respect to the valuation, therefore we shall endeavor to consider the implication of the objection itself.

14. It is an admitted fact that the quantification scribed vide the Impugned Judgment was predicated upon the commissioner's report. It is thus imperative to consider the relevant passage, in the Impugned Judgment itself defining the scope of the task entrusted to the commissioner, wherein it is stated as follows: "In order to arrive at proper decision of these references this Court appointed Mr. Syed Hassan Imam Advocate, retired District and Sessions Judge as Commissioner to inspect the site viz A Area Liaquatabad and Angora Goth Liaquatabad in the presence of parties and their advocates and submit report about the civic facilities, conditions and locations of the houses coming under Lyari Express Way Project and also make enquiry about the market value of the disputed properties at the time of passing of awards " (Underline added for emphasis.) The report submitted by the commissioner to the referee Court, dated 04.06.2016, reproduces the afore highlighted terms of reference, albeit with a typographical error being that time of passing of awards is mistyped as time of awarding of plots. It is apparent from a bare reading of the relevant constituent of the Impugned Judgment itself, and the recital contained in the commissioner's report, that the value to be evaluated was that prevailing at the time of passing of the Awards, being 16.05.2015 and 19.05.2015, and not that prevailing at the time that the notifications, per Section 4/ Section 6, were issued, being 11.02.2013 and 11.05.2013 respectively.

15. The commissioner's report concludes with the following inscription: "It is also necessary to state that it is my assessment based on only two estate brokers reports because of very short time allowed by the Court." The aforesaid reliance upon the information collected from the respective brokers is notwithstanding the commissioner having deprecated the assessment of the said brokers in the following terms: " . however the information collected from two real estate brokers is on higher side due to personal attachment with the people " It would thus follow that the valuation arrived at vide the Impugned Judgment is predicated upon the commissioner's report, which in itself is predicated upon the views of two real estate brokers, considered unsound by the commissioner himself.

16. Learned counsel for the respondents had stressed that witnesses for the appellant had supported the higher valuation of land / property subject matter of the acquisition proceedings than provided vide the Awards, hence, their present challenge to the quantum was unmerited. Learned counsel for the appellants had argued to dispel that impression and dilated at length upon the context and backdrop of the depositions to denote that the assertion of the respondents was incorrect. Be that as it may, the Impugned Judgment has prima facie disregarded the evidence advanced by the said witnesses and in once instance observed as follows: "The witness . has produced assessment valued as per survey reports produced by him which are appearing to be nothing but imaginary as in cross-examination he has admitted that he has not obtained any document of ownership from any inhabitant of the locality and even he has shown his ignorance of about present market value of the construction as per square foot therefore it cannot be ascertained as to how he assessed the amount ."

17. It was observed at the very onset that the Awards were dissonant with the directions of the Division Bench of this Court, in Muhammad Hanif, wherein the varying nature of constituents of the property subject to acquisition proceedings was required to be taken into account. The learned referee Judge had reached the same conclusion, however, the same infirmity was also apparent from the Impugned Judgment. It is also found that the valuation exercise conducted by the learned Referee Court was dissonant with the directives of Section 23(1) of the Act as the exercise was conducted to reflect the value at the time of passing of the Awards instead of the time at which the relevant notification was issued. Finally, it is apparent that the basic starting point of the valuation, demonstrated vide the Impugned Judgment, is the opinion of two real estate brokers, considered unreliable by the very commissioner who relied upon their views.

18. In view of the reasoning and rationale herein contained we are constrained to hold that the Impugned Judgment cannot be sustained as the valuation arrived at and the very basis thereof is not supported by factors upon which the same is predicated. Therefore, we do hereby allow the present appeals and remand the matter/s back to the Referee Court for a de novo determination in accordance with the law. It is expected that the Referee Court shall conduct and conclude the proceedings expeditiously, preferably within three months from the date hereof. ZC/P-29/Sindh \Case remanded.