1980 INSC 0470
                                          Dinanath Mahajan and Others

                                                           Vs

                                       Collector, Land Acquisition, Jammu

                                          Civil Appeal No. 2926 of 1980

                                      (A. C. Gupta, E. S. Venkataramian JJ)

                                                      09.12.1980

                                                     JUDGMENT

GUPTA, J. -

1. The correctness of the judgment under appeal is questioned on two grounds. The first grounds is
that in determining the compensation for the acquired portion in the first, second and third floor of
the premises of methods adopted was not correct. Our attention as drawn to Rule 46 (3) of the Rules
made under the Land Acquisition Act which reads :

                  In regard to house property, average market value of the last ten years or twenty
                  times the annual rental should be adopted.

The High Court found that there was no material on record to indicate the market value of the
property. It appears that the High Court also though that as the premises concerned had not been let
out the second part of the rule would also not apply. In state of Kerala v. P. P. Hassan Koya this
Court held :

                  When the property sold is land with building it is often difficult to secure reliable
                  evidence of instances of sale of similar lands with buildings proximate in time to the
                  date of the notification under Section 4. Therefore the method which is generally
                  resorted to in determining the value of the land with buildings especially those used
                  for business purposes, is the method of capitalization of return actually received or
                  which might reasonably be received from the land and the buildings.

The High Court was therefore in error in thinking that the second part of Rules 46(3) would not
apply unless in acquired portion was in fact let out. There is nothing in the rule to suggest that it
does not permit capitalization of return which might reasonable be received from the premises in
question.

2. The other ground is that the High Court has determined only the express for the shifting of the
office located on the grounds floor and the compensation payable for the room in question has not
been determined. The judgment is not very clear on this point and it required clarification and
reconsideration if necessary.

3. The appeal is allowed to the extent indicated above. The High Court will dispose of the case in
accordance with law. No order as to courts.
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