MP HC | What would be an appropriate factor by which market value of land was to be multiplied to assess the compensation in the case where the land was situated in the rural area? [NH- 148N land acquisition]

Madhya Pradesh High Court: The Division Bench of Vivek Rusia and Rajendra Kumar Verma, JJ. took up a bunch of petitions which had similar facts that the petitioners were owners of agricultural land that came under the acquisition for construction of 12 lanes Delhi-Mumbai Expressway i.e. NH-148N under the provisions of the National Highways Act, 1956 (‘the NH Act of 1956’).

The petitioners being the landowners submitted objections before the competent authority i.e. SDO (Revenue). The competent authority in pursuant to sub-section 1 of section 3D of the NH Act submitted its report to the Central Government. Thereafter Central Government had published a notification under section 3D of the NH Act on 22-12-2018 that the land should be acquired for the construction of NH 148N i.e. the purpose mentioned in section 3A(1) of the NH Act. By virtue of sub-section (2) of section 3D of the NH Act the land has been vested in the Central Government. Proceedings for determining the compensation payable to the landowners under the provisions of the new Land Acquisition Act i.e. The Right To Fair Compensation And Transparency In Land Acquisition, Rehabilitation And Resettlement Act, 2013 (‘the Act of 2013’) begun thereafter.

The controversy involved in these petitions was as to what would be an appropriate factor by which market value of land was to be multiplied to assess the compensation in the case where the land was situated in the rural area?

It was noted that in the present case, all the lands of the landowners were situated within the rural area. In the case of the rural area, the factor by which the market value was to be applied would be between 1.00(one) to 2.00(Two) based on the distance of the project from the urban area, as may be notified by the appropriate Government.

The Court reiterated that the Central Government has acquired the land of petitioners and others for NHAI for the construction of the national highway. Under section 3A of the NH Act if the Central Government is satisfied that for a public purpose any land is required for the building, maintenance, management or operation of a national highway or part thereof, it may, by notification in the Official Gazette, declare its intention to acquire such land.

The national highway is a central Government project undertaken by the NHAI for which the land situated in the State of M.P. has been acquired, meaning thereby for the project of central Government land situated in the State of M.P. are being acquired. As per the definition under section 2(b) of the Act of 2013 the State Government would be the appropriate Government in relation to the acquisition of land situated within the territory of State. The Central Government would be the appropriate government in relation of acquisition of land situated within Union territory except for Pondichery and in relation to acquisition of land for the public purpose in more than one State, the Central Government shall consult with the concerned State Government or the Union territory and under section 2(e)(v) of the Act of 2013 in relation to the acquisition of land for the purpose of the Union, as may be specified by notification, the appropriate Government would be the Central Government.

The Court found that the Central Government has issued a notification prescribing the factor 2.00(two) whereas State of M.P by way of impugned notification dated 29-9-2014 had fixed the multiplier 1.00(one) but the NHAI which was the instrumentality of the Central Government, therefore, by virtue of 2(e)(v) of Act of 2013 the Central Government shall be the appropriate Government, hence the notification dated 9-2-2016 issued by the Central Government would apply.

Since the petitioners had already preferred appeals before the Arbitrator u/s 3G(5), therefore, the Court stated that it is for the Arbitrator to consider and decide the multiplier in view of the findings given hereinabove instead of setting aside the award and remanding the matter to the competent authority.[Badrilal Dhakad v. Union of India, 2022 SCC OnLine MP 280, decided on 27-01-2022]


o Shri Piyush Mathur Senior Advocate with Shri Harshwardhan Sharma for the petitioners.

o Shri Jasneet Singh Hora counsel for the petitioners.

o Smt.Anita Sharma and Shri Tejas Sharma for the National Highway Authority.

o Shri Vivek Dalal AAG and Shri Aditya Garg, GA for the respondent/State.


Suchita Shukla, Editorial Assistant has reported this brief.

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