2025 PLP 1848 (MLD)

Dr. Khurshid Iqbal, J.

Litigation triggered over determination of fair compensation of land acquired for public purposes is drawn out as long as decades. Originating in the colonial era, the primary aim of our land acquisition law the Act of 18941__is to safeguard public funds.2 In spite of that, one can confidently say that our higher courts have strived to develop robust jurisprudence to interpret the law to meet the snowballing challenges of the times. Arguably, the rather unfortunate aspect of the matter is that neither the acquiring departments, nor do the landowners express satisfaction with the principles the courts are tirelessly laying down. And, the litigation snail paces from one court to another.

2. In the above perspective, the present Regular First Appeal (RFA No. 234) filed by the appellant, along with the connected cross-appeals - Nos. 336 and 337 filed by the respondent-authority, are no exceptions. Through the instant appeal No. 234-P/2023, Inayat-ur-Rahman has challenged the judgment and decree dated 28.04.2023, passed by the learned Additional District Judge/Referee Court, for enhancement of the compensation from Rs. 30,000/- per Marla coupled with compulsory acquisition charges at the rate of 15% to Rs. 100,000/- per Marla and compulsory acquisition charges at the rate of 25%. Through Appeal No. 337-P/2023, the respondent-authority has challenged the aforesaid judgment for reversing the enhancement decree. Through appeal No. 336-P/2023, the respondent-authority has challenged the judgment and decree dated 28.04.2023, passed in reference under Section 30 of the Act, 1894, praying for the dismissal of the objection petition filed for apportionment of the enhanced compensation with other co-owners, who are respondents Nos. 03 to 13, from whom he has purchased land, which too has been acquired. Given these circumstances, this Court deems it appropriate to decide all three appeals through this single judicial opinion.

3. To begin with the relevant facts, the matter originated in the year 2008 when the Sarhad Development Authority (respondent) initiated the process for acquiring 1000 acres of land for a project titled "Expansion of Nowshera Industrial Estate at Misri Banda, Meshak, Ali Muhammad, and Mughulki on Peshawar Islamabad Motorway in District Nowshera." In this regard, the Collector (respondent number 1) issued a notification under Section 4 of the Act, 1894, on 17.06.2008. Subsequently, an award bearing number 99-106/DOR/Acq/NSR was announced under Section 11 of the Act on 28.05.2010. The compensation was determined based on the one-year average (Ausat Yaksala) of sale mutations attested between 18.06.2007 and 17.06.2008. The relevant details are provided below. S# Name of Mouzah Kind of land Land Acquired K M Rate per Kanal Total amount 1 Ali Mohammad Barani 118 01 Rs. 1469/87 Rs. 1734611/35 2 --do-- Mera 344 16 Rs.22784/61 Rs.7856202/49 3 --do-- Nul Chahi 26 09 Rs.12612/61 Rs.333603/63 4 --do-- Banjar Qadeem 1733 14 Rs.11202/76 Rs.19422225/01 5. --do-- Ghair Mumkin 38 07 Rs.60200/66 Rs.2308695/31

6. Meshak Barani 344 00 Rs.4528/80 Rs.155790/20 7. --do-- Ghair Mumkin 1008 10 Rs.5715/20 Rs.5763779/20 8. --do-- Nul Chahi 562 03 Rs.25280/80 Rs.14211601/72 9. --do-- Mera 44 03 Rs.5669/20 Rs.250295/18

10. Mughalki Barani 158 16 Rs.60200/66 Rs.95559864/80 11. --do-- Ghair Mumkin 10 15 Rs.9569/20 Rs.102868/90 12. --do-- Banjar Qadeem 81 17 Rs.60200/66 Rs.4927424/02

13. Misri Banda Barani 208 00 Rs.25280/80 Rs.5258406/40 14. --do-- Nul Chahi 1867 19 Rs.16240/80 Rs.30337002/36 15. --do-- Banjar Qadeem 1397 17 Rs.13561/40 Rs.18956802/99 16. --do-- Mera 49 12 Rs.60200/66 Rs.2985952/74 17. --do-- Ghair Mumkin 05 14 Rs.5669/20 Rs.32314/44 Total Land 8000 13 Total Rs. Rs.12,55,99,558/- 15% Compulsory Acquisition Charges Rs.1,88,39,934/- 2% Mutation Fee Rs.25,11,991/- Khumas Fee Rs.99,800/- Grand Total Rs.14,70,51,283/-

4. The appellant, being dissatisfied with the compensation determined in the award, filed a reference under Section 18 of the Land Acquisition Act, 1894. He claimed ownership of the acquired land bearing Khasra numbers 96 to 102, 121/1, 122, 124, 127, 146/st, 159/2, 160/2, 170, and 171, situated in Mauza Meshak. He stated that the land formed part of Sher Shah Suri Residential Town, where he had already sold several plots to various individuals. He further submitted that he had invested billions of rupees in developing the residential scheme, which had attracted considerable public interest. According to the appellant, the acquired land was already being used for a public purpose. He claimed that the market rate of a one-Kanal plot in the area was Rs. 900,000, for which he attached a rate list. He also referred to the compensation awarded for adjoining land acquired for the motorway project, where the rate had been fixed at Rs. 7,000 per Marla in similar references filed by other landowners. He argued that the value of land in the area had appreciated significantly and was currently not less than Rs. 100,000 per Marla. He alleged that the compensation awarded at the time of acquisition was not fairly assessed and therefore prayed for enhancement of compensation to Rs. 2,000,000 per Kanal.

5. During the acquisition process, the appellant filed Writ Petition No. 4450 of 2010, contending that the award was illegal, incorrect, ex parte, and against public interest. The said petition was dismissed on 25.02.2016. Subsequently, the appellant, along with several other landowners, filed another Writ Petition No. 1330 of 2019, challenging the proceedings related to the award. That petition was disposed of with the direction that the Collector shall assess superstructures, firewood trees, fruit orchards, standing crops, and similar elements in accordance with law.

6. In its reply, the respondent-authority raised key defences, including that the compensation was determined in good faith and in accordance with legal requirements. The authority further contended that the appellant's claim regarding the existence of a residential town and the alleged substantial investment made in it was incorrect and without foundation.

7. The learned Referee Court framed issues relating to cause of action, jurisdictional competency, limitation, ownership of the appellant, and the nature of the acquired land. No specific issue was framed regarding the fair determination of compensation. However, while deciding the issues concerning ownership and the nature of the acquired land, the learned Referee Court also addressed the matter of compensation. Since the core question of fair compensation was fully examined, the absence of a specifically framed issue on this point is not considered detrimental to the case at this stage.

8. Both parties recorded their respective evidence as per their choice. A local commission was also appointed, which proposed and determined the compensation at Rs. 100,000 per Marla. The respondent-authority raised objections to the report. The commission was examined before the court, and the respondent-authority was given the opportunity of cross-examination.

9. The arguments of the learned counsel for both parties were heard at length. The record was duly examined.

10. The points for determination are as follows: A. Whether the District Collector, Nowshera, has determined fair and just compensation in the award? B. Whether compensation the learned Referee Court has enhance is fair and just? C. What is the fair and just amount of compensation in light of the evidence and material available on the record and existing jurisprudence?

11. It would be appropriate to begin with the text of the award describing the mode of determination of compensation. This is necessary to see whether the Collector made appropriate efforts to determine fair and just compensation while exercising his authority under the Act, 1894. The award reflects that the draft notification under section 4 of the Act, 1894 was notified on 17.06.2008. The Tehsildar, as per direction, furnished Ausat Yaksala (one-yearly average) in which mutations from 18.06.2007 till 17.06.2008 were mentioned. As many as 17 such mutations of various kinds of land, including, notably, barani, nul chahi, maira, banjar qadeem, and ghair mumkin, were produced. The determination was made of the land nul chahi from mauza Meshak, banjar qadeem from Mughulki, and ghair mumkin from Misri banda. The award states that after issuance of notification under section 4, some 07 persons from the mauza concerned submitted application that their land being agricultural and as sole source of their income, may be excluded from acquisition. Pursuant to certain meeting of the respondent-authority held on 06.03.209, 1000 acres of land would be acquired from the Rashakai interchange, so a corrigendum was issued on 16.03.2009 to the effect that the land was reduced from 12903 Kanal 03 Marla to 8000 Kanal and 13 Marla. The officials of works and service, agriculture and forest divisions were directed to visit the spot for the purpose of assessment of compensation. The award is silent whether the applicants were heard. The award notes that a meeting of the officials was stated to have been held on 07.01.2010. It also notes that on 11.11.2009, notice under section 9 of the Act, 1894 was issued vide letter dated 24.10.2009 in which concerned landowners were ordered to attend the office of the Collector on 11.11.2009 personally or through authorized agent to file their claims/objections, if any. Then, a number of landowners from the three Mauzas were stated to have attended the meeting, who "stated in written that the rate fixed is meagre than the market rate...but they have not substantiated their claim through proper documents." "Hence, the Collector rejected their objections", the award what may be called ruled. The award shows that the landowners approached to the Chief Minister through their local MPA, requesting for exemption of their land from acquisition being their sole source of livelihood. Pursuant to that effort, the Collector visited the spot and relied on the report of the field office that the land in question is mostly barren.

12. Certain significant points arise from the above. Firstly, the award does not clearly indicate how many interested persons were served with notice under Section 9 of the Act, 1894, nor does it mention the mode and manner of service. Secondly, it mentions only five landowners from all three Mauzas who objected to the compensation determined. However, it remains unclear how many landowners in total were served with the said notice. The award notes that the claims of the landowners were rejected because they failed to produce supporting documents. Thirdly, despite the issuance of the corrigendum on 16.03.2009, the same one-year average of 2007-2008 was used for determining compensation. Fourthly, the award is silent as to whether the officials from the Works and Services, Agriculture, and Forest Departments provided an opportunity of hearing to the landowners, or even whether the applicants were heard at all. The fate of their applications evidently ended in dismissal once the land was finally acquired. Fifthly, the objections raised by the five persons from the three Mauzas were dismissed solely on the ground that they failed to provide supporting documents. No effort was made to independently investigate the objections to ensure that the landowners were heard properly. Lastly, the award is entirely silent on the existence of Sher Shah Suri Residential Town, which the appellant claims to have developed on the acquired land. The unavoidable conclusion is that the Collector did not make any meaningful effort to determine the compensation fairly. This includes failure to consider the portions of land developed for agricultural purposes, as well as the future potential of the land. The title and objective of the acquisition project clearly show that the economic zone was located near the Motorway and close to the Wali Interchange. Yet, the Collector relied solely on the one-year average while determining the compensation. In other words, no evidence was collected that could support the assessment of fair compensation.

13. Now coming to the evidence of the parties. Shan Muhammad (PW2), Senior Clerk in the Office of Tehsil Municipal Administration, Jahangira, produced the official record related to the residential schemes known as Sher Shah Suri and Khyber Gardens. The record included the No Objection Certificate (NOC), newspaper advertisements published in the dailies AaJ and Mashriq dated 02.04.2008, minutes of the Scrutiny Committee meeting along with its approval, Gazette Notification of November 2005, and NOC No. 1318-29 dated 26.03.2008 (Exhibit PW2/1). He was subjected to brief cross-examination. He admitted a suggestion that the notification was issued on 26.03.20028. He further stated that the TMA Jahangira obtained the record from Lihazullah, an official of TMA Nowshera, on 21.04.2016. This statement was made with specific reference to his earlier testimony regarding the transfer of the record following the establishment of TMA Jahangira.

14. Shams-ur-Rahman (PW4), attorney of the appellant, produced several documents including gold market rates for the years 2014 to 2017, a list containing the names of approximately 100 individuals to whom plots had been allotted in Sher Shah Suri Town, the town brochure, the No Objection Certificate for establishment of the town, and registration documents from the Excise and Taxation Department. He stated that Sher Shah Suri Town is located adjacent to the Motorway, the Mega City of CPEC, and nearby industrial and commercial zones. He further deposed that the master plan of the town now requires revision, for which the appellant has engaged the services of Al-Chishti Associates. He presented the rates of plots in various blocks of the town, noting that a five-Marla plot in Khyber Block is priced between Rs. 300,000 and Rs. 500,

000. He also stated that certain land, including Khasra Nos. 2448 and 2449, has been mutated in favour of the TMA for the construction of roads, parks, a graveyard, and official and commercial buildings, which have now been acquired by the respondent authority. Additionally, he claimed that in the adjacent CPEC City, the price per Marla has been fixed at Rs. 300,

000. This includes the acquired land that was previously part of the China Zone and is now part of the China Economic Zone established under the respondent authority. He further deposed that the respondent authority has since become a company, a fact which, according to him, justifies the application of an additional 25 percent compulsory acquisition surcharge.

15. During the cross-examination of PW4, key questions asked were regarding the year of the award, issuance of the notification under Section 4, the basis for determination of compensation, the nature of the land as recorded in the revenue record, and whether permission of the court had been obtained for submitting the documents mentioned in the examination-in-chief. In response, he stated that the award was issued in the year 2010, the notification under Section 4 was issued on 17.06.2008, and the compensation was determined on the basis of the one-year average for the years 2007 to 2008. He described the acquired land as ghair mumkin khwar and maira. He also admitted that permission of the court was not obtained for submission of the documents. Notably, he confirmed the submission of written objections. He denied all suggestions that the documents produced were fake or fictitious, that no development had been carried out by the appellant on the acquired land, that he had misrepresented the location of the surrounding land, that the land was located farther from the road, and that the compensation determined by the Collector was fair. No questions were asked regarding the appellant's purchase of the land or the fulfilment of legal and administrative (codal) formalities for the establishment of the residential town.

16. Khalid Javed (RPW-01) submitted the record of receipt and payment of compensation for the superstructure, which included a receipt of Rs. 1,000,000 received by the petitioner. Patwari Sohaid Ahmad produced the record of the one-year average for the period from 17.09.2019 to 18.07.2020, which reflected a value of Rs. 56,962.02 per Marla, amounting to Rs. 1,139,240 per Kanal for maira land. Patwari Jamal Shah (PW1) produced the record of the one-year average for the period from 18.06.2007 to 17.06.2008, which was the basis for the compensation determined by the Collector. He also submitted the one-year average for the period from 28.05.2009 to 28.05.2010. Additionally, he produced the record of tamleek for 12 Kanal and 8 Marla of land transferred by Abdul Wahab in favour of Mst. Roohudin, who subsequently sold the same to the appellant. The transaction was reflected in the column of cultivation.

17. Wajid Aslam, Land Acquisition Clerk from the office of the Collector, produced copies of the impugned award No. 99-106/DOR/ACQ/NSR dated 28.05.2010, the appellant's objections to the notification issued under Section 4, and the acquittance rolls showing payment of compensation. During cross-examination, he admitted that the compensation had been determined on the basis of the one-year average. Wajid Aslam also recorded his deposition on behalf of the respondent authority as RW

1. He stated that the land was acquired through Award No. 109 for the expansion of the Nowshera Industrial Estate at Mouza Misri Banda. He reaffirmed that the compensation was determined on the basis of the one-year average. During cross-examination, he denied the suggestion that the use of the one-year average was unlawful for determining compensation under Section 23 of the Land Acquisition Act, 1894. He admitted that the respondent authority is an autonomous body but expressed his lack of knowledge regarding the legal requirement that compulsory acquisition charges for such entities are 25 percent instead of 15 percent.

18. One Ahsan Laiq, Project Manager of the Pak-China Industrial Zone Rashakai (RDW1), deposed that the land in question was acquired for the then Sarhad Development Authority (SDA), now known as Khyber Pakhtunkhwa Economic Zone Development and Management Company (KPEZDMC). He admitted the acquisition having been made for a company. He referred to the award number, stated that codal formalities were fulfilled, and confirmed that compensation was determined on the basis of the one-year average and paid according to Hasb-e-Rasad Khewat, including compensation for the superstructure. His cross-examination revealed noteworthy remarks. When questioned, he stated that he was "well aware of the correspondence and the whereabouts of the property in question." He further stated, "It is correct that a housing scheme has been approved on the property of the petitioner." However, he volunteered that he did not have knowledge regarding the presence of the housing scheme in the specific disputed Khasra numbers and added that someone had informed him about the existence of the petitioner's housing scheme."

19. Although, he initially stated that he had reviewed the record of the property prior to recording his statement, he later claimed that he was unaware of the property's transfer to the TMA. He also expressed ignorance regarding the total area of the petitioner's acquired land and the specific portion transferred to the TMA. Despite asserting that he had examined the relevant record for the purpose of his deposition, he was not aware that the TMA had issued a No Objection Certificate to the petitioner. Upon further questioning, he stated that he had assumed the position of Project Manager in 2018. Nonetheless, he admitted that he had not personally witnessed the fulfillment of the codal formalities related to the acquisition of the land in question. He was unable to explain the meaning of the term Hasb-e-Rasad Khewat, which he had earlier mentioned in his statement.

20. Another key issue raised during cross-examination concerned the assessment of the superstructure. He stated that such assessment was conducted in 2016, but he expressed uncertainty as to whether it was completed. He denied the suggestion that the respondent authority had concealed the fact of superstructure assessment in objections filed by other landowners, resulting in decisions being made without reference to that assessment.

21. At the conclusion of his cross-examination, he was confronted with inconsistencies in his statement in examination-in-chief and his repeated claims of lack of knowledge. He stated in cross-examination that: It is incorrect that I do not know about my examination-in-chief; therefore, I am showing ignorance about each question. It is further incorrect to suggest that I am well aware of the fact that the acquired property of the petitioner is commercial property, but I am deliberately showing ignorance about its nature to harm the reference of the petitioner.

22. The petitioner successfully established that he had developed Sher Shah Suri Town on the acquired land prior to the commencement of the acquisition process by the respondent authority, as evident by the publication of an advertisement dated 02.04.2008. He was issued a No Objection Certificate by the Tehsil Municipal Administration, and the related record is currently held at the TMA office in Jahangira. The appellant submitted extracts from the town's brochure showing the prices of plots, although the prices were based on instalment plans. It is a common trade practice in society that property sold on instalments is priced higher than that sold through immediate cash payment. This evidence may be considered for the purpose of determining fair compensation. However, the appellant did not produce specific documentary evidence of the expenses incurred on the development of the land. The appellant did succeed in proving that compensation for the superstructure was not considered at the time of acquisition and was only given due consideration as late as the year 2016.

23. The respondent-authority, in the opinion of this Court, failed to disprove the stance of the petitioner. It did not furnish even a minimal amount of evidence to demonstrate that the claim of the petitioner was baseless or false. Consequently, the respondent-authority was unable to substantiate its assertion, as stated in paragraph 2 of its reply, that the petitioner's claim regarding the acquired property being part of Sher Shah Suri Town was incorrect. On the contrary, RDW1 admitted during cross-examination that Sher Shah Suri Town was located on the property in question. However, he quickly changed his position by responding to most questions with a claim of lack of knowledge, stating that he had assumed the position of Project Manager in the year 2018. Despite admitting that he had reviewed the relevant record, including the correspondence related to the acquisition process, he avoided giving meaningful responses to several key questions. His testimony clearly indicates an intentional effort to conceal material facts, thereby rendering himself liable for concealing evidence, which is contrary to the principles of truth and justice, as reflected in the Qur'anic injunction against withholding evidence: "Conceal not evidence; for whoever conceals it his heart is tainted with sin. And Allah know all that you do."3

24. Indeed, as the Project Manager, he was expected to be aware of all material facts of the case, regardless of having assumed the position in the year 2018. This responsibility was also acknowledged by him in his own deposition. However, he clearly avoided providing truthful and accurate answers. It is also admitted without dispute that the one-year average was used as the sole basis for determining the compensation. This clearly indicates that no genuine effort was made to ensure fair compensation.

25. The conclusion drawn from the above discussion is that neither party presented independent, clear, cogent, and confidence-inspiring evidence on the primary issue of determining fair compensation. To address this, the learned Referee Court appointed Mr. Raza as a commission, whose report is to be considered next. The commission inspected the acquired land in the presence of the Patwari Halqa, Girdawar of Jahangira Circle, counsel for the objector, and the Manager of Rashakai Economic Zone, who represented the respondent-authority. The relevant portion of his statement is as follows: The disputed property is located in Mouzah Mishak. The disputed property is in a walled area of Rashakai Special Economic Zone. From revenue record and statements of revenue staff, it is clear that the said property has been acquired for the Nowshera Industrial Estate. As per statement of Patwari Halqa and Girdawar Circle Jehangira, the said property couldn't be pointed out because the Government changed its nature by constructed roads and other developmental works. The property is situated at a distance of about 400 meters from the Wali Interchange of Peshawar Islamabad Motorway and on China Zone Road and at the distance of about 200 meters, a huge factory of ZRK Group is fully functioning for the last 9/10 years. Before the acquisition, the property was utilized for Sher Shah Suri Township in which many residential and commercial plots were sold out by the petitioner/objector and that Township was legally issued NOC by the concerned TMA, Nowshera. At the spot, I have taken the photographs of the area and recorded the statements of Patwari Halqa, Girdawar Circle Jehangira, Manager Rashakai Special Economic Zone, Patwari of KP Economic Zone, Special attorney Shams Ur Rehman and Farid Ullah, the owner of Ourtaba Model Town City.

26. Counsel for the respondent authority availed the opportunity to cross-examine the commission in light of the objections raised. Key questions concerned whether the commission had reviewed the text of the award, the area of the acquired land, the relevant Khasra numbers, and the specific portion of land falling within the boundary wall of the Rashakai Special Economic Zone. The commission responded affirmatively to all these questions.

27. The commission stated that the respondent-authority has changed the nature of the property by constructing roads and buildings. It was also clarified during the proceedings that Sher Shah Suri Town was part of the land acquired by the respondent authority. However, the commission admitted that he did not record the statement of any individual to whom a plot had been allotted in Sher Shah Suri Town. While he acknowledged that he had not mentioned the presence of factories on the acquired land, he explained that he was informed of this by Zone Manager Laiq Ahsan. In this regard, the statement of the said Manager, annexed to the report, - clearly confirms the information. Most significantly, the commission stated that the proposed compensation of Rs. 100,000 per Marla was based on the statement of the Manager, who informed him that the respondent authority sells one acre of land for USD 150,

000. The most significant point emerging from the commission's report is that extensive development had already taken place on the acquired land, to the extent that it was no longer possible to distinctly identify the portion belonging to the appellant. The commission proposed compensation at the rate of Rs. 100,000 per Marla.

28. The appellant did submit certain allotment letters that reflected the sale prices of plots. In one such allotment letter, as per receipt # 2368, the price of a ten-Marla plot is mentioned as Rs. 900,000, which translates to Rs. 90,000 per Marla. An amount of Rs. 6,000 was paid in advance, while Rs. 894,000 is shown as outstanding. The price is based on instalment plans. As previously noted, instalment-based pricing typically exceeds the actual market rate for cash transactions and, therefore, cannot be treated as an accurate benchmark for determining fair compensation. Similarly, the copies of the brochure available on the file reveal that Sher Shah Suri Town was offering three categories of plots in three blocks, namely Khyber Block, VIP Block, and Overseas Block. The per Marla rate in Khyber Block is mentioned as Rs. 60,000, in VIP Block as Rs. 80,000, and in Overseas Block as Rs. 100,

000. However, there is no record available explaining the basis for this difference in price rates among the blocks within the same town. It is unclear whether any special facilities were planned for the VIP or Overseas Blocks. If such facilities exist, they should have been documented on the record. This distinction in pricing, without reasonable justification, does not appeal to a prudent mind. As previously discussed, Sher Shah Suri Town was offering plots on an installment basis. Therefore, the rates mentioned in the brochure appear to be higher on account of this installment model. Secondly, since the plots are not yet fully developed-lacking roads, underground electricity supply lines, drainage pipelines, parks, green belts, and other infrastructure__the increased prices seem to have been added in advance. These facilities are expected to be provided after development. At this stage, when such amenities have not yet been installed or constructed and plots are still being offered on installments, the actual value of the plots is certainly lower than the rates quoted in the brochure.

29. As far as the statement of the local commission is concerned, it appears that their assessment was primarily influenced by the current developmental work and the deposition of the Manager of Rashakai Economic Zone. However, the learned local commission failed to consider that the land acquired in 2010 was of lower value and in a raw, undeveloped state. This land has since been transformed into a highly developed industrial zone through significant public expenditure. Therefore, in the opinion of this Court, the learned local commission has assessed an exaggerated compensation for the land. In the absence of concrete evidence of development costs and with only approximate market indicators available, it would be reasonable, equitable, and in line with judicial precedents to fix compensation at Rs. 50,000 per Marla.

30. Moving on to the legal framework, it seems pertinent to note that the acquisition of private land by the State for public purpose is recognized and well defined since long. Conceptually, it is premised on the power of State to acquire private property for public good even without the consent of its owner. It follows that the State enjoys what is known as "eminent domain" over private property. The doctrine is based on two maxims-salus populi est supreme lex (regard for the public welfare is the highest law), and necessitas publica major est quam private (public necessity is greater than private necessity-propounded by M.T. Circero (106 BCB 43BCE in his work De Legibus, and also coined by Hugo Grotius, in De jure belli ac pacis (On the Law of War and Peace, 1625).4 The State's such power is subject to two restrictions: firstly, the acquisition of land must be in case of extreme necessity owing to public purpose; and, secondly, the acquisition is subject to payment of compensation to the owner. While the State may abridge an individual's right to property, it shall invoke the public purpose justification genuinely, and determine the compensation fairly and justly. The doctrine of eminent domain though originated long ago; it has been mainstreamed by modern States in their national constitutions. Our 1973 Constitution guarantees the right to property, but also makes deprivation of property permissible for "public purpose" and "with compensation to be determined in accordance with law."5 While our Constitution was introduced in the year 1973, our land acquisition law dates back to the year 1894, which is a relic of the colonial rule, as noted in the opening lines of this opinion. Section 23 of the Act, 1894 lays down the matters to be considered for determining compensation.

31. The Constitution and the Act, 1894 do not provide that compensation should be determined fairly and justly. As we shall later observe in this opinion, given the fact that the right to property commands recognition and guaranteed as a fundamental right, fair and just compensation needs to be specifically emphasized. Then, the Act 1894, also is not specific about fair and just compensation. Rather, on a more critical note, section 23 of the Act, 1894, though uses the word 'compensation', it seeks consideration of "the market value of the land" at the time of issuance of the notification under section

4. In the explanation, the provision provides that the transfer (sale) of the land similarly situated and in similar use should be employed as a tool for determination of the market value. For this purpose, the Ausat Yaksala-the average market value determined on the basis of the sale mutations of the similar lands attested in one years is considered. The Collector ordinarily uses this tool only with no demonstrable effort for fair and just compensation. This is in utter disregard of the higher courts' rulings on fair and just compensation, directing consideration of wide range of factors, such as, existing and future potentialities of land, and most notably that Ausat Yaksala should not be used as the sole tool. While our higher courts have been liberally interpreting section 23 of the Act, 1894, the Collector has not given attention to Court's rulings.

32. In paras 11 and 12, above, it is noted with grave concern that the Collector failed to follow the due process of law as per the relevant provisions of the Act, 1894. The functions of the Collector under the Act, 1894, though administrative, but also quasi-judicial in nature.6 The Collector is a statutory authority empowered under the Act, 1894 to determine fair compensation whose decision is likely to prejudicially affect the landowners despite the fact that there is no lis or two contending parties and the contest is between the authority and the landowners, and he is required to act judicially under the Act, 18947. In simple terms, there are two contesting parties before the Collector: the landowners or interested persons, and the acquiring department or company. Therefore, the role of the Collector must be neutral, impartial, and fair-firstly, in the selection of suitable land, and secondly, in the assessment of fair compensation, without showing favour to either party. Moreover, while determining compensation, the Collector issues notices to landowners, invites objections, summons witnesses, compels the production of documents, hears objections, and resolves disputes arising during the acquisition process. The Collector is required to make decisions based on evidence and legal principles, exercising powers under the Act of 1894 in a reasonable, fair, and just manner. Such decisions are subject to judicial review by the courts and must adhere to the principles of natural justice, including fair hearing, impartiality, and clear and cogent reasoning. It is important to emphasize that providing reasons is necessary, even in cases where an administrative authority may have discretion not to assign reasons for a decision. The point is that, as Lord Wolf ruled, "the discretion can only lawfully be exercised by giving reasons."8 Recently, this view was expressed by this court in Kamranullah (2016)."9

33. As observed in the opening lines of this opinion, comprehensive case law is available for guidance. As a starting point, this court would venture to refer to its two most recent judgments rendered in Sarda-ul-Mulk10 (RFA#114:2023), and Ali Khan11 (RFA#70:2023) the main points in those judgments are: firstly, the Act, 1894 is a symbol of colonial rule, aimed at saving of public funds rather than determination of fair compensation. It is apparently for this reason that the words "market value" have been used in the text of the section

23. This court suggested what it would call a paradigm shift by introducing a new land acquisition law. An example of a recent new law is the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, India has introduced in 2013 that has repealed its own Act, 1894. The main objective of the law is fair and just process for land acquisition. It seeks to ensure transparency, participation of the local communities, including the landowners, determination of adequate compensation and rehabilitation of the affected people. It provides that the compensation shall be four times the market value for lands in rural areas and twice in case of urban areas. Other key features of the law include comprehensive rehabilitation and resettlement packages for affected persons, with a view to help them rebuild their lives; evaluation of social impact assessment to minimize disruption; consent of a certain percentage of the landowners; and, transparency by means of information and notification, public hearing and publication of relevant documents. Another key feature of the law is the provision of alternative housing to affected families with basic amenities, including employment opportunities and financial assistance, for example, subsistence grants. Secondly, our Act, 1894 is facing a discernable public dissatisfaction as regards the manner in which it is applied for assessing fair compensation. Thirdly, it is imperative that a human rights approach (elaborated below), as the new Indian law has adopted, should be followed while determining fair compensation. The court observed that such an approach is embedded in Articles 23 and 24 of our 1973 Constitution, recognizing property rights. Fourthly, the human rights approach is also universally recognized in the broader context of economic, social, and cultural rights. Fifthly, the Islamic law approach of acquiring of property-which also commands constitutional recognition-is also equally applicable.

34. In RFA No. 114, the court observed as follows:

20. Fair and adequate compensation for a land acquired for public purpose is also a key issue in international human rights law. It has assumed greater importance in the background of forced eviction for a range of public purposes. The Act of 1894 is a relic of colonial law in the Indo-Pak Sub-continent. There has been self-evident public dissatisfaction with the determination of compensation by the executive authorities concerned. It is high time that our government introduce a new law altogether so that the colonial tinge of the law could be transformed into a human rights approach through constitutional obligation of the executive authorities of the State.

21. A human rights approach to land acquisition may be defined as recognition of land as property and the peaceful enjoyment of its possession; a source of livelihood in terms of economic rights and a characteristic of identity linked with social and cultural rights. Land is a means of realization of human rights. While property in land may be acquired for public purpose, such as, social and economic development projects (for example, poverty reduction, urban and rural development, health and educational facilities, peace building, etc), a human rights approach creates obligation on the State to ensure legal guarantees for proper rehabilitation and adequate compensation, most notably in cases of compulsory acquisition, which, in the context of our discussion may, in a sense, be seen a genre of forced eviction.

22. Forced eviction is a concept of wide contours, defined as "the permanent or temporary removal against the will of individuals, families and/or communities from the homes and/or land which they occupy, without the provision of, and access to, appropriate forms of legal or other protection" (See Report of UN Special Rapporteur on Forced Eviction, on the website of the UN Human Rights Office of the High Commissioner: https://www.ohchr. org/en/special-procedures/sr-Commissioner: housing/forced-evictions, accessed 29 November 2022). The UN Committee on Economic Social and Cultural Rights in its 1997 General Comment 7 on forced eviction has suggested that States shall apply relevant human rights standards while carrying out forced eviction. The Committee further underlined that individuals affected by eviction orders have a right to adequate compensation for any loss of property and that evictions should never result in individuals being rendered homeless or vulnerable to the violation of other human rights.

23. The human right approach to land acquisition provides a helpful perspective for constitutional obligation of fundamental rights within the meaning of Articles 23 and 24 of our Constitution, 1973.

35. In RFA No. 70, the court added and explained the Islamic law perspective as under: Maulana Maududi in his book "Tafheemať" (Urdu), has stated: It follows that no one shall acquire property invalidly or through falsehood.

36. Some important rulings of our Supreme Court and a host of factors discussed in them are as follows: i. Sarhad Development Authority N.W.F.P. (now KPK) through CEO (Officio) and others v. Nawab Ali Khan and others (2020 SCMR 265). ii. Air Weapon Complex through DG v. Muhammad Aslam and others (2018 SCMR 779). iii. Land Acquisition Collector, GSC, NTDC (WAPDA), Lahore and another v. Mst. Surraya Mehmood Jan (2015 SCMR 28). iv. Province of Punjab through Land Acquisition Collector and another v. Begum Aziza (2014 SCMR 75). v. Askari Cement Limited (formerly Associated Cement Limited) through Chief Executive v. Land Acquisition Collector (Industries) Punjab and others (2013 SCMR 1644). vi. Land Acquisition Collector, Abbottabad and others v. Gohar-ur-Rehman Abbasi (2009 SCMR 771). vii. Ministry of Defence through Secretary, Government of Pakistan and others v. Syed Wajid Rizvi (2009 SCMR 105).

37. A careful perusal of the above referred case law shows that while determining compensation of the acquired land, attention may be given to: a. The fact that 'compensation' should not be limited to 'market value' as the former having been in the Act, 1894, is conceptually broader. b. The principle of willing buyer and willing seller who always demand gold for gold and never copper for gold. c. The value of similar land in Khasras and Mauza situated adjacent to the land acquired. d. The escalation in the price of the land during the period in which the process of acquisition is completed. e. The future use of the land proposed for acquisition. f. The fact that compensation is not determined merely on the basis of past sales (Ausat yaksala). g. Such key positive factors, as location, existing potentiality, smallness of size, proximity to a road and a developed area, regular shape and special value of an owner to whom it may have some very special advantage. h. Such key negative factors, as largeness of area, considerable distance from a road, a narrow strip of land with very small frontage compared to depth, uneven level requiring filling of depressed portion, remoteness from developed area. i. The fact that no mathematical formula could be set for determination of compensation but see the cumulative effect of the above range of factors.

38. The latest case is Mst. Ayesha Bibi12 (SC:2024), in which august apex Court held:

19. Several factors are to be considered, while determining the amount of compensation to be paid to the landowners for the acquisition of their land: the value of similar land nearby is considered; additionally, any increases in land value during the acquisition process may be factored in; and most importantly, the future utility of the acquired land, keeping in view the availability of facilities for its said utilization, are considered to assess its potential value. It is important to note that there is no single formula for the determination of the compensation due to the landowners for the compulsory acquisition of their land. Instead, different factors relevant to each situation are used together to determine the market value as defined in Section 23(1) of the Act. Courts are increasingly recognizing the potential for future development when determining fair compensation for acquired land, reflecting a more holistic approach." Other recent cases are: Tafoor-ur-Rehman13 (SC: 2023); Alam Shir14 (SC:2023); Sarhad Development Authority15 (SC:2020); and Muzaffar-ul-Mulk Khan.16

39. In light of the above reappraisal of evidence, and the legal principles, this court has reached to the conclusion that the District Collector has failed to determine the compensation in the award fairly and justly. The appellant has successfully proved that he had developed Sher Shah Suri Residential Town on the acquired land, and this fact was entirely ignored by the Collector while determining the compensation. Both the parties, however, failed to produce cogent and convincing evidence in support of their respective contentions. The learned referee court, therefore, appointed commission which suggested Rs. 1,00,000/- per Marla. The learned Referee Court though relied on the report of the commission, but it provided no reasons for reducing the recommended amount to Rs. 30,000/-. Furthermore, the Referee Court decreed compulsory acquisition charges at the rate of 15 percent without justification, despite the fact that evidence on record established that the respondent authority had assumed the status of a company. In such cases, the applicable rate should be 25 percent. Hence, this Court answers both questions 'A' and 'B' in the negative. As to question 'C', this Court is of the view that the compensation amount recommended by the local commission is somewhat overestimated and exaggerated, as the material facts discussed above were not properly considered by the commission while determining the compensation. On the other hand, the Referee Court reduced the compensation amount drastically without providing sufficient justification. Therefore, keeping in view the evidence available on record, the commission's report, and based on logical deductions and analogical reasoning, this Court answers question 'C' by holding that the fair and just compensation is Rs. 50,000 per Marla. The prayer of the appellant for enhancement of compulsory acquisition charges to 25 percent is also allowed, as the respondent authority has acquired the status of a company. As far as the 6 per cent interest is concerned, the same is treated as rental value in view of the Supreme Court's ruling in the 2022 Government of Khyber Pakhtunkhwa's case.17 Hence, appeal No. 234 is partially allowed in the above terms. Consequently, Appeals No. 336 and 337 are dismissed. Parties to bear their own costs.

40. Before parting ways with judgment, in light of the foregoing analysis and legal and constitutional principles, this court deems it appropriate to suggest certain guidelines and measures that must be followed by acquiring authorities in future acquisitions. These guidelines are essential to uphold the quasi-judicial character of the acquisition process, envisaged in the Act 1894 in relation to the constitutional provisions pertaining to property rights and the right of fair hearing in the proceedings for acquisition of land to protect the rights of landowners against arbitrary deprivation of property. The objective is to ensure that future land acquisition proceedings are transparent, participatory, and constitutionally compliant, and adherence to Islamic law thereby precluding grievances that frequently give rise to prolonged litigation. Accordingly, the acquiring authority shall: A. Issue timely and proper notices to all affected landowners under Section 9 and subsequent provisions of the Act, 1894, ensuring that such notices are duly served through personal delivery, publication, and local announcements. B. Provide meaningful opportunity of hearing to the landowners prior to finalizing the award, enabling them to raise objections regarding classification, valuation, possession, and future use of their land. C. Undertake a comprehensive and transparent assessment of the acquired land prior to the issuance of award, taking into consideration not only its existing classification in the revenue record but also its potential value for residential, commercial, or industrial development. D. Consider future potentiality of the land based on its location and proximity to infrastructure. E. Give due consideration to the value of existence of superstructures, orchards, crops, or any development carried out by the owner. F. Ensure independent verification of the above factors through qualified technical experts, surveyors, or valuation officers who shall submit a reasoned report forming part of the record. G. Consider the feasibility of rehabilitation and resettlement measures, particularly where large-scale acquisition leads to economic displacement, and provide such arrangements where necessary in coordination with relevant authorities. H. Record detailed reasons in writing for the basis of compensation determined in the award, supported by comparable sales, prevailing market trends, and valuation criteria under Section 23 of the Land Acquisition Act, as interpreted by superior courts. I. Avoid reliance solely on the one-year average (Ausat Yaksala) unless corroborated by additional material reflecting true market conditions. J. Maintain institutional accountability by ensuring that designated officers responsible for land acquisition undertake capacity-building training in valuation methods, constitutional rights, and procedural fairness. K. Realize that there being two contesting parties before him-the landowners/interested persons, and the acquiring department or company-his role must be neutral, impartial, and fair: firstly, in the selection of suitable land; and, secondly, in the assessment of fair and just compensation, without showing favour to either party. L Establish a mechanism for pre-award review (for example, an internal committee) to assess whether the process has been complied with statutory and constitutional safeguards. It is highly expected that the above guidelines would be helpful in determining fair and just compensation, lending credibility to the proceedings; reducing litigation, and preserving judicial resources in the broader perspective of justice. MH/130/P Order accordingly.