Rail Vikas Nigam Limited vs Koshiya Bai Since Dead Through His Lrs … on 23 July, 2026

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    Madhya Pradesh High Court

    Rail Vikas Nigam Limited vs Koshiya Bai Since Dead Through His Lrs … on 23 July, 2026

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                              IN THE   HIGH COURT OF MADHYA PRADESH
                                            A T J AB AL P UR
                                                  BEFORE
                                       HON'BLE SHRI JUSTICE VIVEK JAIN
                                          FIRST APPEAL No. 834 of 2022
                                         RAIL VIKASH NIGAM LIMITED
                                                   Versus
                                        NARMADA PRASAD AND OTHERS
                                                    WITH
                                          FIRST APPEAL No. 634 of 2022
                                  THE STATE OF MADHYA PRADESH AND OTHERS
                                                   Versus
                                            SHRI RAM AND OTHERS
                                          FIRST APPEAL No. 635 of 2022
                                  THE STATE OF MADHYA PRADESH AND OTHERS
                                                   Versus
                                         SATYENDRA PAL AND OTHERS
                                          FIRST APPEAL No. 636 of 2022
                                  THE STATE OF MADHYA PRADESH AND OTHERS
                                                   Versus
                                        DHARAMPAL SINGH AND OTHERS
                                          FIRST APPEAL No. 637 of 2022
                                  THE STATE OF MADHYA PRADESH AND OTHERS
                                                   Versus
                                          NIRMALA BAI AND OTHERS
                                          FIRST APPEAL No. 638 of 2022
                                  THE STATE OF MADHYA PRADESH AND OTHERS
                                                   Versus
                                        NARMADA PRASAD AND OTHERS
                                          FIRST APPEAL No. 811 of 2022
                                  THE STATE OF MADHYA PRADESH AND OTHERS
                                                    Versus
                                        RAJU @ RAJESH PAL AND OTHERS
                                          FIRST APPEAL No. 822 of 2022
    
    
    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
                                                           2
    
    
                                    THE STATE OF MADHYA PRADESH AND OTHERS
                                                      Versus
                              VARDHMAN FEBRIC (A.UNIT OF VARDHMAN TAXTILES LIMITED)
                               GRAM PILIKARAN TAALPURA REHTI ROAD TEHSIL BUDH AND
                                                     OTHERS
                                             FIRST APPEAL No. 824 of 2022
                                    THE STATE OF MADHYA PRADESH AND OTHERS
                                                       Versus
                              VARDHMAN FEBRICS (A UNIT OF VARDHMAN TEXTILES LIMITED)
                                                   AND OTHERS
                                             FIRST APPEAL No. 830 of 2022
                                            RAIL VIKAS NIGAM LIMITED
                                                       Versus
                              VARDHMAN FABRICS (A UNIT OF VARDHMAN TEXTILES LTD. AND
                                                     OTHERS
                                             FIRST APPEAL No. 831 of 2022
                                             RAIL VIKAS NIGAM LIMITED
                                                       Versus
                                              RAIS KHAN AND OTHERS
                                             FIRST APPEAL No. 836 of 2022
                                             RAIL VIKAS NIGAM LIMITED
                                                       Versus
                                             NIRMALA BAI AND OTHERS
                                             FIRST APPEAL No. 838 of 2022
                                             RAIL VIKAS NIGAM LIMITED
                                                       Versus
                                           RAJU @ RAJESH PAL AND OTHERS
                                             FIRST APPEAL No. 839 of 2022
                                          THE STATE OF MADHYA PRADESH
                                                       Versus
                              VARDHMAN FABRICS (A UNIT OF VARDHMAN TAXTILES LTD.) AND
                                                      OTHERS
                                             FIRST APPEAL No. 840 of 2022
                                             RAIL VIKAS NIGAM LIMITED
                                                       Versus
    
    
    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
                                                            3
    
    
                                                SHRI RAM AND OTHERS
                                             FIRST APPEAL No. 842 of 2022
                                            RAIL VIKAS NIGAM LIMITED
                                                      Versus
                                 MAKHAN SINCE DEAD THROUGH LRS. DILIP PANWAR AND
                                                     OTHERS
                                             FIRST APPEAL No. 844 of 2022
                                             RAIL VIKAS NIGAM LIMITED
                                                       Versus
                                             WAHID KHAN AND OTHERS
                                             FIRST APPEAL No. 851 of 2022
                                              RAIL VIKAS NIGAM LIMITED
                                                        Versus
                                          SATYENDRA PAL SINGH AND OTHERS
                                             FIRST APPEAL No. 855 of 2022
                                             RAIL VIKAS NIGAM LIMITED
                                                       Versus
                                           DHARAMPAL SINGH AND OTHERS
                                             FIRST APPEAL No. 857 of 2022
                                            RAIL VIKAS NIGAM LIMITED
                                                       Versus
                              VARDHMAN FABRICS (A UNIT OF VARDHMAN TEXTILES LTD.) AND
                                                      OTHERS
                                             FIRST APPEAL No. 858 of 2022
                                            RAIL VIKAS NIGAM LIMITED
                                                       Versus
                              VARDHMAN FABRICS (A UNIT OF VARDHMAN TEXTILES LTD.) AND
                                                      OTHERS
                                             FIRST APPEAL No. 1286 of 2022
                                    THE STATE OF MADHYA PRADESH AND OTHERS
                                                      Versus
                                KOUSHLYA (DIED) THROUGH LRS SUSHILA BAI AND OTHERS
                                             FIRST APPEAL No. 1287 of 2022
                                     THE STATE OF MADHYA PRADESH AND OTHERS
    
    
    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
                                                      4
    
    
                                                Versus
                                      DHARAMPAL SINGH AND OTHERS
                                       FIRST APPEAL No. 1289 of 2022
                                THE STATE OF MADHYA PRADESH AND OTHERS
                                                 Versus
                                      SATYENDRA SINGH AND OTHERS
                                       FIRST APPEAL No. 1292 of 2022
                                THE STATE OF MADHYA PRADESH AND OTHERS
                                                 Versus
                                        BHAGWATIBAI AND OTHERS
                                       FIRST APPEAL No. 1293 of 2022
                                THE STATE OF MADHYA PRADESH AND OTHERS
                                                 Versus
                                         CHAMPALAL AND OTHERS
                                       FIRST APPEAL No. 1294 of 2022
                                THE STATE OF MADHYA PRADESH AND OTHERS
                                                   Versus
                              KISHORILAL (DIED) THROUGH HARIBAI AND OTHERS
                                       FIRST APPEAL No. 1305 of 2022
                                        RAIL VIKAS NIGAM LIMITED
                                                  Versus
                                    SATYENDRA PAL SINGH AND OTHERS
                                       FIRST APPEAL No. 1306 of 2022
                                        RAIL VIKAS NIGAM LIMITED
                                                  Versus
                                      DHARAMPAL SINGH AND OTHERS
                                       FIRST APPEAL No. 1330 of 2022
                                        RAIL VIKAS NIGAM LIMITED
                                                  Versus
                                        BHAGWATI BAI AND OTHERS
                                       FIRST APPEAL No. 1331 of 2022
                                        RAIL VIKAS NIGAM LIMITED
                                                  Versus
    
    
    
    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
                                                                         5
    
    
                               KOSHIYA BAI SINCE DEAD THROUGH HIS LRS SUSHILA BAI AND
                                                       OTHERS
                                                    FIRST APPEAL No. 1332 of 2022
                                                     RAIL VIKAS NIGAM LIMITED
                                                               Versus
                                                      CHAMPALAL AND OTHERS
                                                    FIRST APPEAL No. 1333 of 2022
                                               RAIL VIKAS VIGAM LIMITED
                                                         Versus
                              KISHORILAL S/O HALKE SINCE DEAD THROUGH LRS HARI BAI AND
                                                        OTHERS
    
                              Appearance:
                              Shri Anshuman Swamy - Government Advocate for the appellant/State in the
                              respective cases.
                              Shri Brijesh Shukla - Senior Advocate with Shri Satyam Agrawal and Shri
                              Aaryan Shukla - Advocates for the respondent/Rail Vikas Nigam Limited,
                              Bhopal in the respective cases.
                              Shri Ajay Mishra - Senior Advocate with Shri Gaurav Tiwari and Ms. Namrata
                              Purohit - Advocates for the respondent in the respective cases.
                              Shri Ravi Shankar Yadav and Shri Dharmendra Singh Sisodia - Advocates for
                              the respondent in the respective cases.
    
    
                                                                JUDGMENT
    

    (Reserved on :23.06.2026)
    (Pronounced on :23.07.2026)

    This batch of matters arises out of and against the awards passed by the

    SPONSORED

    Reference Court in favour of the land losers, whereby enhancing the

    compensation awarded to the land losers for the project of acquisition of land

    for construction of “Third Railway line between Barkheda to Budhani in Sehore

    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
    6

    District of Madhya Pradesh”. These appeals relate to land acquired in three

    villages namely Mana, Talpura and Bansapur.

    2. These appeals are filed by the State as well as the Rail Vikas Nigam

    Limited being the acquiring agency and the requiring/beneficiary agency of the

    lands in question respectively. The appeals can be grouped into three groups,

    firstly, the agricultural lands acquired in village Talpura, the second being the

    lands acquired in village Mana and thirdly for the lands acquired, which were

    diverted lands and situated in villages Mana, Bansapur and Talpura.

    3. For the sake of convenience, the details of bifurcation of the appeals

    into groups is as under:-

                                         Filed by RVNL            Filed by State              Village
                                                                 - Non-Diverted -
                                     FA No.855/2022           FA No.636/2022              Mana
                                     FA No.1305/2022          FA No.1289/2022             Mana
                                     FA No.1306/2022          FA No.1287/2022             Mana
                                     FA No.851/2022           FA No.635/2022              Mana
                                     FA No.831/2022                     --                Talpura
                                     FA No.834/2022           FA No.638/2022              Talpura
                                     FA No.836/2022           FA No.637/2022              Talpura
                                     FA No.838/2022           FA No.811/2022              Talpura
                                     FA No.842/2022                        --             Talpura
                                     FA No.844/2022                     --                Talpura
                                     FA No.1330/2022          FA No.1292/2022             Talpura
                                     FA No.1331/2022          FA No.1286/2022             Talpura
                                     FA No.1332/2022          FA No.1293/2022             Talpura
                                     FA No.1333/2022          FA No.1294/2022             Talpura
                                     FA No.840/2022           FA No.634/2022              Talpura
                                                                - DIVERTED -
                                     FA No.858/2022           FA No.824/2022              Mana
                                     FA No.857/2022           FA No.839/2022              Bansapur
                                     FA No.830/2022           FA No.822/2022              Talpura
    
    
    
    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
                                                                        7
    
    
    

    4. Learned counsel for the appellant RVNL as well as by the State has

    vehemently argued that in all these cases the compensation has been grossly and

    disproportionately enhanced by the Reference Court without any just cause and

    the Reference Court has in fact gone beyond its jurisdiction and made

    inappropriately exorbitant enhancement of compensation, which cannot be

    justified by the true interpretation of Right to Fair Compensation and

    Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013

    (for short ‘Act of 2013’).

    5. It is vehemently contended by learned counsel for the appellant that

    there are certain basic principles governing determination and enhancement of

    compensation, which have not been followed by the Reference Court while

    granting enhancement of compensation. It is argued that the determination as

    per Section 26 of Act of 2013 has two modalities, i.e. as per Section 26(a),

    which is the valuation for registration of sale deeds or agreements in the area

    where the land is situated or (b) the average price of sale for similar type of land

    situated in nearest village or nearest vicinity area. The third (c) being the

    consented amount of compensation, which is not applicable in the present case,

    because there was no agreed or consented quantum of compensation in the

    present case between the land losers and Rail Vikas Nigam Ltd. (‘RVNL’ for

    short), or even the State.

    6. It is argued by learned counsel for the appellant that in the present

    matters in most of the cases either the lands in different villages have been taken

    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
    8

    into consideration or the lands situated not in near vicinity, but as much as 4 to

    5 kilometers away have been taken into consideration by the Reference Court

    without any just reason. It is argued that in various cases, the exemplar lands,

    which were cited before the Reference Court and which have been believed and

    relied by the Reference Court were situated 3 to 4 or even 5 kilometers away

    from the acquired land and had a totally different position, location and

    situation from the acquired land. It is argued that in various cases the exemplar

    lands were situated adjacent to the P.M. Grameen Sadak or the State or National

    Highways, but the acquired lands were not so situated adjacent to the highways

    or rural roads, but are situated adjacent to other lands and are at much distance

    may be half kilometer to even 2 kilometers from the rural roads or State or

    National Highways, despite which the Reference Court has blindly accepted the

    assertion of the land losers and relied on exemplar lands despite there being a

    difference in location, situation and position of the exemplar lands from the

    acquired lands.

    7. Learned Senior Counsel for the RVNL has also argued that the

    exemplar lands being situated away from the acquired lands and in not situated

    on State or National Highway or on rural roads is duly established by various

    maps that have now been filed along with the present appeal by RVNL, because

    the RVNL in many of the cases before the Reference Court was ex-parte,

    though it is admitted that in some of the cases the RVNL had duly been

    represented before the Reference Court and had even led evidence before the

    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
    9

    Reference Court. It is argued that the maps which have been filed along with the

    present appeals if seen in their true perspective, would indicate that the

    exemplar lands are at much distance from the acquired lands and there is no

    parity or comparison in valuation of exemplar lands with the acquired lands

    despite which the Reference Court has accepted the valuation of exemplar lands

    and put it in effect for the purpose of determination of valuation of acquired

    lands. It is argued that such a course of action adopted by the Reference Court is

    utterly contrary to law and the Reference Court was expected to act in

    consonance with law, which it had failed to do. It is, therefore, argued that the

    orders/awards to the Reference Court in question being contrary to law have to

    be set aside.

    8. Learned counsel for the appellant while making such vehement

    assertions has heavily relied on judgment of the Hon’ble Supreme Court in case

    of Gafar and others vs. Moradabad Development Authority, 2007 AIRSCW

    5372 to contend that the exemplar land should be in vicinity and if the

    assessment has been made on guess work without adhering to the comparable

    facts to compare the sale deeds relied by the land losers, such sale deeds cannot

    be relied.

    9. Learned counsel further refers to Bhule Ram vs Union of India AIR

    2014 SC 1957and submits that the claimants are required to provide evidence to

    support their valuations and guesswork should not be done. Due consideration

    should be made on geographical location and factors like proximity to highway.

    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
    10

    In the said case, comparison was made between lands in developed areas and

    adjacent to highways with the lands in interior places, which were as much as 6

    km away from the ring road and therefore, the Hon’ble Apex court dismissed

    the appeal of the land loser.

    10. Further reliance is placed on Union of India vs. Mangat (dead) by

    LRs & others AIR 2000 SC 3527to contend that a land adjacent to major road

    holds greater value than land farther away and applying a uniform price

    regarding these essential distinctions vitiates the award/order of the Reference

    Court.

    11. Reliance was also placed on Rajashekar Sankappa Taradandi and

    others vs. Assistant Commissioner & Land Acquisition Officer AIR 1996 SC

    3222to contend that potential future use should not influence compensation and

    the use which the land is being put on the date of acquisition has to be seen and

    any future appreciation in land value as a consequence of acquisition of land

    should not be taken into consideration. The only consideration should be the

    value and potential future use as available on the date of notification, not

    thereafter.

    12. Learned Senior Counsel further relied on Kanwar Singh and others

    vs. Union of India AIR 1999 SC 317to contend that reliance on valuation of

    adjacent village would lead to absurd consequences, because each village

    adjoins some of the other village in this manner a village in interior part of the

    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
    11

    country by taking adjoining villages as equals may even be treated to be equal

    to Delhi.

    13. While placing reliance on Civil Appeal No.5095 of 2025 (Sumitraben

    Singabhai Gamit vs. State of Gujrat & others) passed by the Supreme Court, it

    is contended that valuation of the land should be seen on the date of Notification

    under Section 11 of Act of 2013, and not thereafter.

    14. While placing reliance on Civil Appeal No.3998 of 2024 (M.P. Road

    Development Corporation vs. Vincent Daniel and others) passed by the

    Supreme Court, it is argued that once there are no exemplars in the vicinity,

    then Section 26(b) would not have any application and Section 26(a) would

    have application and the valuation for registration of sale deeds as per the Indian

    Stamp Act, which has been laid down for the area by officials of concerned

    stamp department/stamp authority has to be taken to be value for the purpose of

    determination of compensation.

    15. On these grounds, it is stated that the awards passed by the Reference

    Court have been passed in a manner erroneously inflating the quantum of

    compensation to a higher side, which should not be given stamp of approval by

    this Court. It is argued that in some of the cases the enhancement is very much

    exorbitant and the enhancement goes even up to 6 to 7 times of the

    compensation assessed by the Collector at the time of acquisition of the land.

    Therefore, it is argued that the very fact that there has been enhancement by as

    much as 3 times to as much as 6 to 7 times of the assessment by the Collector

    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
    12

    itself shows the arbitrary manner in which the Reference Court has enhanced

    the compensation and therefore, this Court should step in and rectify the

    illegality committed by the Reference Court by exercising its appellate

    jurisdiction under Act of 2013.

    16. The factual contentions on different villages and types of lands would

    be dealt with while making consideration on different cases in later part of this

    judgment and therefore, the arguments as to individual case are not being

    reproduced in this part of the judgment.

    17. Per contra, learned counsel for the respondent land losers has argued

    that the award passed by the Reference Court is fully justified so far as village

    Talpura is concerned. The lands in vicinity have been taken care of by the

    Reference Court and there is no illegality in that the other village that has been

    taken into consideration is another village of the same Gram Panchayat and is

    not a far away village. It is argued that in fact one of the sale deed was at

    somewhat lower side while the other sale deed was at some higher side, but the

    Reference Court has taken the average value of both the sale deeds. The sale

    deed which was at higher side was not adjacent to any village road or National

    or State Highway and therefore, it cannot be argued by the RVNL or the State

    that examplar lands that have been cited are adjacent to State or National

    Highway or village road. It is argued that the lands are in close vicinity of

    Budhni town and in fact two of the three villages i.e. Mana and Bansapur fall

    within the municipal limits of Municipal Council, Budhani and therefore, the

    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
    13

    insistence of the railways to pay compensation to such land losers as per the

    rates of un-irrigated agricultural lands belies all common sense and for lands in

    urban areas such compensation could not have been awarded by treating the

    lands to be un-irrigated agricultural lands because on the date of Notification

    under Section 11 the lands had already been made a part of Municipal Council

    area Budhni, which is a large Tahsil of District Sehore, about 50-60 km. from

    State capital City of Bhopal and therefore, the valuation arrived at by the

    Reference Court is fully proper.

    18. It is contended that some of the lands are industrial lands and are

    diverted lands and for those lands the compensation has been rightly granted to

    Vardhman Fabrics Limited, which was using the lands acquired from the said

    industrial unit for industrial purposes and purposes ancillary to its main plant.

    Learned Senior Counsel appearing for Vardhman Fabrics Limited argued that

    the assessment of land made for grant of compensation to Vardhman Fabrics

    has been properly made, because it was a diverted industrial land and for such

    diverted industrial land on which ancillary processes to the industrial unit of

    Vardhman Fabrics were being run, could not be compensated at circle/guideline

    rates for un-irrigated agricultural lands. While placing reliance on evidence

    adduced before the Reference Court, learned Senior Counsel appearing for

    Vardhman Fabrics Limited has supported the impugned awards to the extent of

    Vardhman Fabrics Limited. So far as agricultural lands in village Mana are

    concerned there are cross objections in these appeals filed by the land losers,

    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
    14

    who are seeking enhancement of compensation on the grounds that the

    compensation assessed is at lower side and should be enhanced. It is argued by

    counsel for the land losers for village Mana that applications for diversion of the

    land to industrial use had already been filed and these land losers were

    intending to establish industrial units on the land in question and therefore,

    compensation should have been granted to them at higher rates and not on the

    rates on which they have been paid.

    19. The aforesaid was vehemently objected by learned counsel for the

    State and by the RVNL by arguing that the lands in the cases in which cross

    objections have been filed had not yet been diverted and therefore, though

    diversion applications may be pending, but in absence of real diversion taking

    place and industrial unit to be set up on these lands the land losers cannot seek

    compensation on the basis of valuation of diverted lands. On these assertions, it

    is prayed to reject the cross objections.

    20. Counsel for the respondents land losers have further argued that the

    maps filed along with the present appeals are not certified by any revenue

    authority and have been prepared only by the railway authorities. It is further

    argued that these maps filed along with these appeals by RVNL do not contain

    any scale of distance so as to arrive at inference of a particular figure of distance

    of two lands. In absence of scale, the distance of even 100 meter can be

    amplified to appear as large distance, once no scale is shown on the map.

    Nothing can be argued on the basis of such maps by the RVNL. It is further

    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
    15

    pointed out that in various cases, RVNL was not ex-parte before the Reference

    Court and it had indeed filed such maps before the Reference Court, which have

    duly been considered by the Reference Court and discarded.

    21. This Court has heard learned counsel for the parties at length and

    perused the record.

    22. In the present batch of appeals, one of the questions that has been

    posed before this Court is that whether reliance on Section 26(b) has rightly

    been made by the Reference Court by deviating from the circles/guideline

    approved by the relevant stamp authority for the area in question and

    proceeding to direct payment of compensation on the basis of average sale price

    for similar type of land situated in nearest village or nearest vicinity area. As per

    Section 26 the following has been provided:-

    “26. Determination of market value of land by Collector.-(1)
    The Collector shall adopt the following criteria in assessing and
    determining the market value of the land, namely:–

    (a) the market value, if any, specified in the Indian Stamp
    Act, 1899
    (2 of 1899) for the registration of sale deeds or
    agreements to sell, as the case may be, in the area, where the
    land is situated; or

    (b) the average sale price for similar type of land
    situated in the nearest village or nearest vicinity area; or

    (c) consented amount of compensation as agreed upon
    under sub-section (2) of section 2 in case of acquisition of
    lands for private companies or for public private partnership
    projects, whichever is higher:

    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
    16

    Provided that the date for determination of market value shall
    be the date on which the notification has been issued under section
    11.
    Explanation 1.–The average sale price referred to in clause

    (b) shall be determined taking into account the sale deeds or the
    agreements to sell registered for similar type of area in the near
    village or near vicinity area during immediately preceding three
    years of the year in which such acquisition of land is proposed to
    be made.

    Explanation 2.–For determining the average sale price
    referred to in Explanation 1, one-half of the total number of sale
    deeds or the agreements to sell in which the highest sale price has
    been mentioned shall be taken into account.

    Explanation 3.–While determining the market value under
    this section and the average sale price referred to in Explanation 1
    or Explanation 2, any price paid as compensation for land
    acquired under the provisions of this Act on an earlier occasion in
    the district shall not be taken into consideration.

    Explanation 4.–While determining the market value under
    this section and the average sale price referred to in Explanation 1
    or Explanation 2, any price paid, which in the opinion of the
    Collector is not indicative of actual prevailing market value may be
    discounted for the purposes of calculating market value”

    23. As per the aforesaid Section 26, the Collector shall adopt the

    valuation as per Section 26 (a), (b) or (c) not in that order, but whichever is

    highest. Therefore, if the valuation of exemplar sale deeds is higher than the

    valuation of guidelines/circle rates, then that higher valuation has to be given

    Signature Not Verified
    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM
    17

    effect by the Collector and once the Collector fails in its duty to do so, then the

    Reference Court can step in and pass appropriate order by exercising its

    jurisdiction under Section 64 of Act of 2013. In the case of Vincent Daniel

    (supra), it has been held by the Hon’ble Supreme Court as under :-

    “18. Section 26 deals with the determination of the market value of
    the land by the Collector. Sub-section (1) to Section 26 consists of
    three Clauses, (a), (b) and (c), each prescribing a criterion or
    standard for assessing the market value. Clause (a) prescribes the
    consideration of the market value specified in the Stamp Act for the
    registration of agreements/sale deeds in the area where the
    concerned land is situated.

    19. Clause (b) to Section 26(1) requires the Collector to consider
    the average sale price for similar types of land situated in the
    nearest village or the nearest vicinity. This test of average sale
    price is similar to the exemplar test which is adopted and applied
    in cases of acquisition under the Land Acquisition Act, 1894, but
    with modifications in terms of Explanations 1 to 4. Computation
    under Clause (b) is in relative terms. Therefore, while drawing a
    comparison with the average price of the other lands under Clause

    (b), the Collector must consider all such factors that have been
    held to be relevant for accurate valuation by this Court. These
    include the theory of deduction, the principle of belting, and
    accounting for other advantages or disadvantages of the acquired
    land, in comparison to the lands existing in the same vicinity.

    20. Clause (c) to Section 26(1) of the Acquisition Act, 2013
    requires the Collector to take into consideration the amount of
    compensation agreed upon by the parties under Section 2(2) of the

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    Acquisition Act, 2013 in cases involving the acquisition of land for
    private companies or public-private partnership projects. These
    agreements are entered into voluntarily, based upon consent terms,
    and reflect the market value as settled inter se the parties.

    21. It is important to note that the values computed in terms of
    Clauses (a), (b) and (c) of Section 26(1) of the Acquisition Act,
    2013 are not to be averaged. The highest of the values as
    determined by Clauses (a), (b) and (c), is to be treated as the
    market value under Section 26(1) of the Acquisition Act, 2013.”

    24. To get over the aforesaid legal position, the Senior Counsel for RVNL

    had vehemently argued that the exemplar sale deeds are not of the lands situated

    in the nearest village or in the nearest vicinity area and despite the lands not

    being situated in the nearest village or nearest vicinity area, the Reference Court

    has erred in accepting the valuation contained in the said so-called exemplar

    sale deeds.

    25. The legal position that the exemplar sale deeds have to be for the

    same vicinity of the area or of the nearest village having the similar type of

    circumstances is not at all in dispute and therefore, to appreciate the contentions

    of learned counsel for the appellant State and RVNL, this Court may be

    required to consider the individual cases and whether the Reference Court has

    properly considered the exemplar sale deeds to the six sale deeds, which should

    be relied as per Section 26(b) of Act of 2013 or should not have been so relied

    by the Reference Court.

    26. Therefore, this Court takes up the appeals group wise.

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    Agricultural lands in village Talpura:-

    27. In the land situated in village Talpura, the Collector has assessed the

    land at two different rates, i.e. agricultural and non-agricultural whereas the

    Reference Court has assessed the lands by taking the average of two sale deeds

    found acceptable by the Reference Court to be relied as exemplar sale deeds, or

    in some cases the Reference Court has accepted the lower of the two sale deeds

    where the higher sale deed had not been placed before the Reference Court. In

    all the matters relating to village Talpura, it is seen that there are various

    exemplar sale deeds, which were relied by the land losers, but ultimately the

    Reference Court has relied on two exemplar sale deeds. For consideration of

    such documents, the Reference Court record of F.A. No.67 of 2022 is being

    taken for consideration for village Talpura.

    28. One of the two exemplar sale deeds is Exhibit P-3C as per which one

    Rajesh Yadav has sold the land to Jyoti Society, which is total area 0.315

    hectare for value of Rs.39.50 lakhs and the date of sale deed is 16.10.2017

    whereas the date of Section 11 Notification is 19.01.2018 and the proposal for

    acquisition of land by RVNL is stated to be 13.11.2017. As per the sale deed,

    the valuation of land comes to Rs.65.18 lakh per hectare.

    29. By the other sale deed Exhibit P-4, which is executed by one Mangali

    Prasad Sharma in favour of Vardhman Textiles Ltd., which is dated 30.06.2017,

    land area 0.571 hectare has been sold for consideration of Rs.42.30 lakh, which

    comes to Rs.74.08 lakh per hectare. The Reference Court in all the case

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    srelating to village Talpura has either taken the average of the two sale deeds,

    i.e. Rs.69.63 lakh per hectare or where the higher one was not filed,has taken

    the lower one, i.e. Rs.65.18 lakh per hectare.

    30. Upon perusal of the sale deed Exhibit P-3, it is seen that this sale deed

    relates to village Talpura, but indeed this is a land, which is adjacent to Pradhan

    Mantri Rural Road. As per this sale deed as already mentioned above, price is

    Rs.65.18 lakh per hectare.

    31. However, the other sale deed Exhibit P-4 is the sale deed executed by

    one Mangali Prasad Sharma in favour of Vardhman Textiles Ltd. and this sale

    deed is for village Khapakhurd, which is in the same Gram Panchayat area

    Pilikarar. It has come on record that village Talpura and Khapakhurd, both are

    within the same Gram Panchayat. This land is not a land adjacent to any road,

    rural, State or National Highway. It is surrounded on all sides by roads of

    different agriculturists or other persons and the valuation mentioned in this sale

    deed is Rs.74.08 lakh per hectare.

    32. The Railways in some of these cases by filing application under Order

    41 Rule 27 CPC has relied on another sale deed and the same sale deed is on

    record in some cases before the Reference Court itself, as Exhibit D-2. This

    Court has gone through the aforesaid sale deed, which is relied by the Railways

    as Exhibit D-2 and by the said sale deed dated 18.03.2017, one Ram Mohan

    Yadav has sold 1.012 hectare land to one Dinesh Yadav, and the sale

    consideration shown is Rs.7.50 lakh. However, this sale deed cannot be cited as

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    a exemplar sale deed, because this is a sale between father and son as Dinesh

    Yadav – purchaser is the son of vendor-Ram Mohan Yadav.The sale transaction

    taking place between father and son may be by way of family arrangement or

    settlement, or whatever understanding that might have been between the

    members of the family and it cannot be cited as an example to assess

    compensation for other lands. Even otherwise, this sale deed itself indicates on

    its front page that even the Registrar has assessed the value of land as Rs.25.86

    lakh per hectare, though the sale deed mentions the consideration paid to be

    Rs.7.50 lakh. It is evident that this sale deed is only around 25% of the

    guideline/circle value and it is some arrangement between members of the same

    family i.e., father and son and by no stretch of imagination, it can be cited as an

    exemplar sale deed to assess the compensation for land losers. Therefore, the

    Reference Court has rightly discarded this sale deed Exhibit D-2 executed

    between father and son, which has been relied in all these cases relating to

    village Talpura either before the Reference Court or wherever RVNL was ex-

    parte before the Reference Court, then by filing before this Court along with

    application under Order 41 Rule 27 CPC. Such sale deed has rightly been

    discarded by the Reference Court.

    33. This Court has also examined the maps filed with the present appeals.

    In some cases where RVNL was not proceeded ex-parte, such maps were filed

    by RVNL before the Reference Court itself. These maps do not contain any

    scale from which the distance between two land parcels can be inferred. Further,

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    none of these maps shows the land covered by sale deed Exhibit P-4, which

    appears to have been omitted to conceal the fact that the land under that

    exemplar sale deed is also not adjacent to any State or National Highway or

    rural road.

    34. Both the exemplar sale deeds belonged to date prior to the date of

    issuance of notification under Section 11 of Act of 2013 and no error can be

    found in the action of the Reference Court in relying the said sale deed and in

    fact arriving at average valuation of both these sale deeds in most of these cases.

    35. Therefore, this Court does not find any error of law or jurisdiction in

    the orders of the Reference Court so far as agricultural lands in village Talpura

    are concerned. This Court has even appreciated the evidence independently in

    all those cases and even after independent assessment of evidence, this Court

    has arrived at a conclusion that in view of the evidence available on record, the

    findings so far as village Talpura are concerned are duly in accordance with

    law.

    36. Even the maps that have been filed along with these appeals cannot be

    relied to reduce the compensation assessed by the Reference Court. These maps

    do not indicate any scale and even these maps do not indicate existing facilities

    that increase the value of land by marking existing Railway Stations, bus stops,

    commercial constructions, public facilities, residential colonies, etc. Even the

    Railway line and Railway Stations are not indicated in these maps, though the

    acquisition is for construction of third Railway line. Therefore, nothing turns in

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    favour of RVNL or State in terms of these maps, that seem to have been

    prepared only to oppose payment of fair compensation.

    37. Therefore, this Court does not find any error in the impugned award

    passed in the matter of agricultural lands in village Talpura and accordingly

    First Appeal Nos.FA No.831/2022, FA No.834/2022, FA No.638/2022, FA

    No.836/2022, FA No.637/2022, FA No.838/2022, FA No.811/2022, FA

    No.842/2022, FA No.844/2022, FA No.1330/2022, FA No.1292/2022, FA

    No.1331/2022, FA No.1286/2022, FA No.1332/2022, FA No.1293/2022, FA

    No.1333/2022, FA No.1294/2022, FA No.840/2022, FA No.634/2022, FA

    No.838/2022 &FA No.811/2022 are dismissed and the award passed by the

    Reference Court in all these appears is affirmed.

    Lands Situated in village Mana:-

    38. The lands situated in village Mana are all undiverted lands and the

    compensation was assessed by the Land Acquisition Officer to the extent of

    Rs.42.35 Lakh per hectare which has now been enhanced by the Reference

    Court to Rs.2.81 Crore per hectare which is stated to be increased by as much as

    6.6 times per hectare.

    39. On one hand, the State and RVNL have challenged the award passed

    by the Reference Court on the ground that enhancement has been made at

    exorbitant quantum of compensation but on the other hand, the land losers have

    filed cross-objections in this appeal seeking enhancement of compensation

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    awarded by the Reference Court and have sought the valuation to be fixed at

    Rs.3.25 crores.

    40. The village Mana is undisputedly within the limits of Municipal area

    Budhni, District Sehore. This position is undisputed between the parties that out

    of the three villages of which the lands have been acquired and are subject

    matter of these appeals, two villages are in the urban area of Municipal Council

    Budhni, District Sehore. The Collector had assessed the compensation as per the

    guideline/circle rates prevailing for agricultural land which was objected to by

    the land losers by initiating reference and now the Reference Court has assessed

    the compensation to the tune of Rs.2.81 crore per hectare by enhancing from

    Rs.42.35 lakh per hectare, that was awarded by the Collector. The assessment

    by the Collector was as per the guidelines/ circle rates for irrigated agricultural

    land of the village in question.

    41. The Reference Court has relied on two sale deeds Exhibit P-7 and P-8

    to arrive at a particular quantum of compensation. This Court has gone through

    the said two sale deeds. Before going to the sale deeds, some dates are relevant.

    The proposal for acquisition of land by RVNL is dated 25.01.2019 and the date

    of notification under Section 11 is 18.07.2019. Award has been passed on

    24.09.2019, whereas sale deed Exhibit P-7, which is part of record in

    FA.1306/2022, is dated 08.03.2016 and the sale deed Exhibit P-8 is dated

    17.06..2015 and as such both these sale deeds are well prior in time to the

    initiation of acquisition. Sale deed Exhibit P-7 is for agricultural land in Budhni

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    town and same is the position for the sale deed Exhibit P-8 which is also sale of

    agricultural land in Budhni town. It cannot be denied that value of agricultural

    land in a village which has potential only for the purpose of agriculture, is

    different whereas the valuation of agricultural land which is within urban area

    and within part of Municipal area, its potential is different, even though it may

    not be diverted as yet. By the very fact of the land being a part of Municipal

    area, that too of a large Tehsil like Budhni, the valuation of land cannot

    mechanically be assessed to be valuation as agricultural land and once it

    becomes part of the Municipal area, then its valuation must be assessed

    accordingly.

    42. So far as the assessment by the Reference Court is concerned, the

    land which has been sold by the exemplar sale deeds Exhibit P-7 and P-8 is also

    undiverted land situated within Municipal area Budhni and same is the position

    of the exemplar sale deeds. Though the land in sale deed Exhibit P-7 is adjacent

    to National Highway and the land in sale deed Exhibit P-8 is adjacent to Budhni

    – Raheti Main Road, but the Reference Court has assigned cogent reasons for

    accepting the sale deeds as exemplar sale deeds for the land in question.

    43. The Reference Court has considered the deposition of the Patwari as

    DW-1. In para-8 of his deposition, the Patwari Sanjay Kumar Saxena (DW-1)

    states that Budhni Municipal Council has 15 Wards and Ward No.13 is Mana

    Ward. He admitted that within 500 meters from the acquired land, there is a

    sports stadium, Government PG College, Government ITI and a Government

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    colony having 500 residential houses. He further admits that one paper mill and

    railway sleeper factory is in Mana including two saw-mills and nearby is the

    industrial unit of Vardhman Textiles. This evidence has been recorded in

    respect of land loser Dharampal Singh relating to FA No.1306/2022 and FA

    No.1287/2022.

    44. So far as same land loser Dharampal Singh is concerned in FA

    No.636/2022 and FA No.855/2022,it has come on record that this land is nearby

    to the other land of the same land loser which is subject matter of FA

    No.1306/2022 and therefore this land also being part of the urban area, the

    Reference Court has held the same valuation of the land to be acceptable for this

    land also.

    45. So far as the methodology of valuation on the basis of Exhibit P-7 and

    P-8 is concerned, it has come on record that the land is near Government PG

    College, Government ITI, near the colony of 500 Government quarters and near

    Vardhman Textile Mill. The Reference Court has held that there are two sale

    deeds Exhibit P-7 and P-8 which have been relied by the land loser and the

    average of sale consideration of the two sale deeds would be Rs.2.81 Crore.

    This Court does not find any error in the aforesaid logic and reasoning adopted

    by the Reference Court in assessing the valuation of land in Village Mana in

    respect of land loser Dharampal Singh and therefore FA Nos.1305/2022,

    1306/2022 filed by RVNL and FA 1289/2022 and 1287/2022 filed by the State

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    Government are dismissed. The cross objections filed by the land loser are also

    rejected.

    46. Now so far as the remaining two lands in respect of village Mana are

    concerned, the same are subject matters of four appeals because appeals have

    been filed by the Railways as well as by the State. The Reference Court has held

    that Mana being an area within Municipal limits of Budhni and it having

    various urban facilities like PG College, ITI, 500 quarters of Government

    colony and in the vicinity there is Vardhman Textile Mill. Therefore, for the

    other lands also situated in Ward number 13 of urban area Budhni, the same

    valuation of Rs.2.81 crore per hectare should be adopted. This Court does not

    find any error of law or jurisdiction in the aforesaid reasoning adopted by the

    Reference Court and therefore FA No.855/2022, 636/2022, 851/2022 and

    635/2022 are also rejected and cross objections also of the land loser also stand

    rejected and all the appeals relating to agricultural lands of village Mana also

    the awards of the Reference Court are affirmed.

    47. In the cross-objections, the counsel for the land losers has vehemently

    relied on certain applications filed before the Industries Department for grant of

    permission to start a rice-milling unit on the land in question which was

    submitted sometime in the year 2015 and also an application for diversion of

    land in question to non-agricultural purpose.

    48. The aforesaid application would not turn anything in favour of the

    land losers and their cross-objections because undisputedly the diversion never

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    took place and the industrial unit was never established prior to acquisition of

    land. Therefore, for this also the cross-objections deserve no consideration.

    Diverted Lands:-

    49. Now coming to the diverted lands, the diverted lands are subject

    matter of FA.858/2022 and FA.824/2022 for diverted lands in village Mana,

    FA.857/2022 and FA.839/2022for diverted lands in village Bansapur and

    FA.830/2022 and FA.822/2022 for diverted lands in village Talpura.

    50. All these appeals are filed against Vardhman Fabrics Limited who

    was having industrial unit on the acquired land and the land of the industrial

    unit fell in three different villages namely Mana, Bansapur and Talpura.

    51. So far as FA. 857/2022 and FA.839/2022 are concerned, which relate

    to village Bansapur, the Reference Court has assessed the value of land at the

    rate of Rs.3.09 Crore per hectare. The Reference Court has held that the lands

    are located in village Bansapur; and village Bansapur and village Mana both are

    within the urban area of Budhni town being situated within the area of

    Municipal Council, Budhni. The Reference Court has held that once for the

    lands in village Mana the value of land has been assessed at Rs.2.81 Crores and

    village Bansapur which is also in the same urban area and is having better

    location as it is adjacent to the National Highway then the valuation of lands in

    village Bansapur cannot be assessed at lesser value and therefore, the valuation

    of land was assessed at Rs.2.81 crore and the lands being diverted lands, granted

    increment of 10% on such value.

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    52. This Court does not find any error in the aforesaid logic and

    justification adopted by the Reference Court in arriving at the said valuation of

    land. The lands have been found to be diverted lands and being used for the

    purpose of industry or for ancillary processes connected to the industry as held

    by the Reference Court and owned by the industrial unit. Therefore this Court

    does not find any error in the award of the Reference Court relating to village

    Bansapur, which is the subject matter of FA No.857/2022 and FA 839/2022.

    53. So far as FA. 858/2022 and FA 824/2022 are concerned, these

    appeals relate to diverted lands in village Mana. It has been held by the

    Reference Court that for the non-diverted land in village Mana in other cases

    valuation of Rs.2.81 crore per hectare has been assessed and this land being

    diverted land and being used for industry or processes ancillary to the running

    of industry and owned by industrial unit, therefore on account of land being

    diverted an increment of 10% has been granted which also is not found to be

    arbitrary or illegal and is duly supported by the evidence on record and therefore

    FA Nos. 858/2022 and 824/2022 are also dismissed.

    54. So far as FA.830/2022 and FA.822/2022 are concerned, in these cases

    it has been held by the Reference Court that the lands in village Talpura have

    already been assessed to the value of Rs.65.18 lakh per hectare and these lands

    being owned by industrial unit and being used for industry or purposes ancillary

    with running of the industry and diverted for non-agricultural purposes, the land

    loser is entitled to 10% increment on the value. This Court does not find any

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    error of law, jurisdiction or facts in the aforesaid order passed by the Reference

    Court and therefore, these appeals are also dismissed.

    55. In the above terms, all these appeals are dismissed and the cross-

    objections filed by the land losers are also dismissed.

    56. Before parting with the matter, the objection of the RVNL and State

    Government in employing the factor of 2.0 for the lands found to be situated in

    rural area has been assailed, is to be dealt with. It is contended that the State

    Government has not issued any notification in terms of Section 30(2) of the Act

    of 2013 and therefore the acquisition having been carried out by the State

    though for the purpose of Railways, the factor of 1.0 would be applicable even

    for the rural areas.

    57. It is seen that the Government of India has issued notification for

    acquisitions in rural areas by notifying factor of 2.0 in terms of Section 30(2) of

    Act of 2013 by exercising powers conferred by column-3 of serial No.2 of

    Schedule 1 of the said Act.

    58. The acquisition in the present case is though made by the State

    Government, but it is made for the purpose of Railways which is a Department

    of the Government of India.

    59. This issue has already been considered by a Single Bench as well as a

    Division Bench of this Court. The matter concerning Railways was considered

    by Single Bench of this Court in Deputy Chief Engineer (Construction) Vs.

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    Sajruddin Ali and Others [FA. No.1373 of 2023]. The Coordinate Bench has

    held as under:-

    “This appeal, under Section 74 of the Right to Fair Compensation and
    Transparency in Land Acquisition Rehabilitation and Resettlement Act,
    2013 (for short “Act of 2013”), has been filed against the Award dated
    31.03.2023 passed by Principal District Judge, Sheopur (M.P.) in Land
    Acquisition
    Case No. MJC/37/2022.

    2. Facts necessary for disposal of this appeal, in short, are that certain
    lands have been acquired for the purpose of laying down Meter Gauge
    in place of Narrow Gauge Railway Line. The lands, under the ownership
    of various persons situated in villages Bardhabujurg, Raipura &
    Dantarda Khurd, have been acquired. From village Dantarda Khurd
    around 2.200 hectares, from village Raipura 2.394 hectares and from
    village Bardhaburjurg about 17.555 hectares, in total 28.689 hectares of
    land was acquired under the Act of 2013. The Award was passed by
    Land Acquisition Officer on 08.10.2021. The matter was agitated under
    Section 64 of the Act of 2013 and Reference Court has applied the factor
    of “2”, whereas according to appellant Reference Court should have
    applied the factor of “1”, as notified by the State Government.

    3. In the present appeal, solitary ground has been raised by appellant
    that in place of factor of “2”, factor of “1” should have been applied. By
    referring to Section 26 of the Act of 2013, it is submitted by counsel for
    appellant that guidelines have been provided under the aforesaid
    Section for determination of market value of land by Collector. It is
    submitted that as per Section 26(2) of the Act of 2013, the market value
    calculated as per sub-section (1) shall be multiplied by a factor to be
    specified in the first schedule. By referring to Section 3(e) of the Act of
    2013, it is submitted that since the land which has been acquired is
    situated in the territory of State of Madhya Pradesh, therefore, Section
    3(e)(i)
    would apply and thus it is submitted that notification issued by
    the State Government providing the factor “1” for multiplier as per
    Section 26(2) of the Act of 2013, would apply. Thus, it is submitted that
    Reference Court has wrongly applied the multiplier of “2” by treating
    the factor as “2” as notified by the Central Government.

    4. Per contra, appeal is vehemently opposed by counsel for claimants. It
    is submitted that since lands were acquired for the purpose of Union of
    India, therefore, Section 3(e)(v) would apply and thus, the notification

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    issued by the Central Government would apply according to which
    multiplier/factor of “2” is applicable.

    5. Heard learned counsel for the parties.

    6. Section 26 of the Act of 2013 reads as under:-

    26. Determination of market value of land by Collector.

    (1) The Collector shall adopt the following criteria in assessing and
    determining the market value of the land, namely:-

    (a) the market value, if any, specified in the Indian Stamp Act,
    1899
    (2 of 1899) for the registration of sale deeds or agreements to
    sell, as the case may be, in the area, where the land is situated; or

    (b) the average sale price for similar type of land situated in the
    nearest village or nearest vicinity area; or

    (c) consented amount of compensation as agreed upon under sub-

    section (2) of section 2 in case of acquisition of lands for private
    companies or for public private partnership projects,
    whichever is higher:

    Provided that the date for determination of market value shall be the
    date on which the notification has been issued under section 11.
    Explanation 1. – The average sale price referred to in clause (b) shall be
    determined taking into account the sale deeds or the agreements to sell
    registered for similar type of area in the near village or near vicinity
    area during immediately preceding three years of the year in which such
    acquisition of land is proposed to be made.

    Explanation 2. – For determining the average sale price referred to in
    Explanation 1, one-half of the total number of sale deeds or the
    agreements to sell in which the highest sale price has been mentioned
    shall be taken into account.

    Explanation 3. – While determining the market value under this section
    and the average sale price referred to in Explanation 1 or Explanation
    2, any price paid as compensation for land acquired under the
    provisions of this Act on an earlier occasion in the district shall not be
    taken into consideration.

    Explanation 4. – While determining the market value under this section
    and the average sale price referred to in Explanation 1 or Explanation
    2, any price paid, which in the opinion of the Collector is not indicative
    of actual prevailing market value may be discounted for the purposes of
    calculating market value.

    (2) The market value calculated as per sub-section (1) shall be
    multiplied by a factor to be specified in the First Schedule.

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    (3) Where the market value under sub-section (1) or sub-section (2)
    cannot be determined for the reason that-

    (a) the land is situated in such area where the transactions in
    land are restricted by or under any other law for the time being in
    force in that area; or

    (b) the registered sale deeds or agreements to sell as mentioned
    in clause (a) of sub-section (1) for similar land are not available
    for the immediately preceding three years; or

    (c) the market value has not been specified under the Indian
    Stamp Act, 1899
    (2 of 1899) by the appropriate authority,
    the State Government concerned shall specify the floor price or
    minimum price per unit area of the said land based on the price
    calculated in the manner specified in sub-section (1) in respect of
    similar types of land situated in the immediate adjoining areas:

    Provided that in a case where the Requiring Body offers its shares to the
    owners of the lands (whose lands have been acquired) as a part
    compensation, for acquisition of land, such shares in no case shall
    exceed twenty-five per cent. of the value so calculated under sub-section
    (1) or sub-section (2) or sub-section (3) as the case may be:

    Provided further that the Requiring Body shall in no case compel any
    owner of the land (whose land has been acquired) to take its shares, the
    value of which is deductible in the value of the land calculated under
    sub-section (1):

    Provided also that the Collector shall, before initiation of any land
    acquisition proceedings in any area, take all necessary steps to revise
    and update the market value of the land on the basis of the prevalent
    market rate in that area:

    Provided also that the appropriate Government shall ensure that the
    market value determined for acquisition of any land or property of an
    educational institution established and administered by a religious or
    linguistic minority shall be such as would not restrict or abrogate the
    right to establish and administer educational institutions of their choice.
    Section 3(e) of the Act of 2013 reads as under:

    3. Definitions.

    – In this Act, unless the context otherwise requires,-

    (a) to (d) xxx xxx xxx

    (e) “appropriate Government” means,-

    (i) in relation to acquisition of land situated within the territory of,
    a State, the State Government;

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    (ii) in relation to acquisition of land situated within a Union
    territory (except Puducherry), the Central Government;

    (iii) in relation to acquisition of land situated within the Union
    territory of Puducherry, the Government of Union territory of
    Puducherry;

    (iv) in relation to acquisition of land for public purpose in more
    than one State, the Central Government, in consultation with the
    concerned State Governments or Union territories; and

    (v) in relation to the acquisition of land for the purpose of the
    Union as may be specified by notification, the Central
    Government:

    Provided that in respect of a public purpose in a District for an area not
    exceeding such as may be notified by the appropriate Government, the
    Collector of such District shall be deemed to be the appropriate
    Government; ……

    7. The only controversy involved in the present case is that which is the
    “appropriate Government”, whether State Government or Central
    Government?

    8. The undisputed fact is that the entire land is situated within the State
    of Madhya Pradesh and entire land has been acquired for the benefit of
    Railways which is Union of India. It is clear from Section 3(e)(i) that if
    the land is situated within the territory of the State of Madhya Pradesh,
    then notification issued by the State Government would apply. However,
    in the present case, although the land is situated within the State of
    Madhya Pradesh but it has been acquired for the purposes of Union.

    Therefore, as per Section 3(e)(v) of Act of 2013, notification issued by
    the Central Government would apply. It is not the case of appellant that
    Central Government has not notified the multiplier of “2”. Furthermore,
    Division Bench of this Court in the case of BadrilalDhakad and Others
    Versus Union of India and Others reported in 2022 SCC Online MP
    280 has held as under:-

    16. 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

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    JYOTISHI
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    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. Since the land of the
    petitioners is situated within the State Government, therefore, the
    respondents are treating State Government as appropriate
    Government and applying the notification dated 29.9.2014 under
    section 26(2) of Act of 2013 which gave a cause of action to the
    petitioners to challenge the validity of the said notification but if it
    is held that in this acquisition the appropriate Government is the
    Central Government then the notification issued by the Central
    Government dated 9.2.2016 would apply in which the multiplier is
    2.00 (two) for the rural area. As per 1st Schedule, the following
    components provided in the table shall constitute the minimum
    compensation package to be given to the landowners whose land is
    acquired. Serial no. 2 is the factor by which the market value is to
    be multiplied in the case of rural areas and for which the
    appropriate government is required to notify the factor based on
    the distance of the project from the urban area. 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 has fixed the multiplier 1.00(one) but the NHAI
    which is 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. In such a situation,
    the validity of the notification issued by the State Government is
    not required to be examined or adjudicated because the same is
    not applicable in the case of the petitioners. Since the petitioners
    have already preferred appeals before the Arbitrator u/s 3G(5),
    therefore, 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.

    9. Under these circumstances, this Court is of considered opinion that
    Reference Court did not commit any mistake by applying the multiplier
    of “2” as notified by the Central Government. No other argument is
    advanced by counsel for appellant.

    10. It is not out of place to mention here that the claimants have also
    filed appeals for enhancement of compensation amount. Since the
    question of factor is covered in all the appeals and the claimants are

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    satisfied with the factor of “2′ which has been applied by Reference
    Court and this Court has also come to a conclusion that factor of “2”

    would apply for multiplier as provided under Section 26(2) of Act of
    2013, therefore, by keeping the question of determination of market
    value, as provided under Section 26(1) of the Act of 2013 as challenged
    by the claimants, open, the Award dated 31.03.2023 passed by Principal
    District Judge, Sheopur (M.P.) in Land Acquisition Case No.
    MJC/37/2022 is hereby affirmed so far as it relates to application of
    factor “2” for multiplier as required under Section 26(2) of the Act of
    2013.

    11. With aforesaid observations, appeal fails and is hereby dismissed.”

    60. In relation to acquisitions carried out for National Highways, the

    matter was considered by a Division Bench in WP No.16808/2019 (Indore), and

    it has been held by the Division Bench as under :-

    14. 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. Since the land of the
    petitioners is situated within the State Government, therefore, the
    respondents are treating State Government as appropriate Government
    and applying the notification dated 29.9.2014 under section 26(2) of Act
    of 2013 which gave a cause of action to the petitioners to challenge the
    validity of the said notification but if it is held that in this acquisition the
    appropriate Government is the Central Government then the notification
    issued by the Central Government dated 9.2.2016 would apply in which
    the multiplier is 2.00(two) for the rural area. As per 1 st Schedule, the
    following components provided in the table shall constitute the minimum
    compensation package to be given to the landowners whose land is
    acquired. Serial no.2 is the factor by which the market value is to be
    multiplied in the case of rural areas and for which the appropriate
    government is required to notify the factor based on the distance of the

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    JYOTISHI
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    37

    project from the urban area. 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 has fixed the multiplier
    1.00(one) but the NHAI which is 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. In such a
    situation, the validity of the notification issued by the State Government
    is not required to be examined or adjudicated because the same is not
    applicable in the case of the petitioners. Since the petitioners have
    already preferred appeals before the Arbitrator u/s 3G(5), therefore, 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.”

    61. Therefore, this Court does not find any error in the impugned order

    passed by the Reference Court in holding that the compensation would be

    multiplied by a factor of 2.0 as per notification issued by the Government of

    India. Therefore, this ground of the appellant State and the RVNL is also

    discarded.

    62. In view of the aforesaid discussion, all these appeals fail and are

    dismissed. Cross-objections are also fail and hereby dismissed.

    (VIVEK JAIN)
    JUDGE

    rj/nks

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    Signed by: RAJESH KUMAR
    JYOTISHI
    Signing time: 7/23/2026
    6:09:43 PM



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