ISLAMABAD:
The Supreme Court has held that the state’s inherent power to compulsorily acquire private property for a public purpose is not absolute, declaring that courts have a constitutional duty to ensure that landowners receive fair compensation that reflects the true value of their property rather than arbitrary or outdated assessments.
In a detailed 20-page judgment authored by Justice Muhammad Ali Mazhar, a division bench upheld the Peshawar High Court’s (PHC) decision to increase compensation for privately acquired land in Swabi district. The ruling lays out broad legal principles for compulsory land acquisition and emphasizes that constitutional guarantees protecting property rights must be balanced against the state’s power over eminent domain.
The judgment also cautioned acquiring agencies against delaying acquisition proceedings, noting that lengthy delays coupled with outdated valuation methods unfairly deprive landowners of fair compensation.
It directed the courts to take into account inflation, rise in land prices and the future potential of the property while determining compensation.
“The role of the court is to ensure fair compensation in the acquisition of property as the guardian of constitutional rights. Although the doctrine of eminent domain is the inherent power of the state to compulsorily acquire private property for a public purpose, even against the owner’s will, this power is not absolute and is strictly regulated by the Constitution in order to uphold the fundamental authority of the Constitution, while upholding the fundamental rights of the Constitution, while upholding the constitutional right. citizens,” the judgment says.
The court further noted that one of the most important tasks of the judiciary is to ensure that the compensation actually reflects the actual value of the acquired property.
“The most recognizable work of fiction is built on the metaphor ‘gold for gold’ not copper for gold’, which is predominantly deployed as a legal principle to guarantee fair and just compensation, so that the owner may not be left in a major economic crisis, but receive money no less than the loss imposed in the public interest or for the public good.”
Explaining the concept of market value, the court said that it represents the amount that a willing buyer would normally pay a willing seller.
“The doctrine of potential value informs the future potential use of the land, which must also be considered by the courts for remedial measures. If the compensation is not fully rational, the courts may advance or increase the amount of compensation, including if the amount is found to be based on outdated assessment rates, or the award appears to be unreasonable or manipulated.”
The judgment also expressed concern over delays in acquisition procedures, with authorities often extending both compensation payments and land possession.
“The acquiring agency cannot sleep over the acquisition proceedings. It is quite commonly observed that the acquisition proceedings and the payment of the compensation are delayed for an indefinite period and the landowners remain deprived of fair compensation for their acquired land.”
“Even the possession of properties is delayed due to lackadaisical attitude of the land acquisition officers, which also creates complications. In fact, the period flanked by the initial notification and final allotment is an essential ingredient and key factor in determining the price,” it noted.
The court added that where acquisition proceedings are pending for years, compensation based solely on the value of the property at the time of notification cannot be considered reasonable.
“If acquisition proceedings are delayed for years, including taking possession of land, the market value as on the date of notification can no longer be interpreted fairly and equitably, rather the court must apply inflationary trends and potential value doctrines to account for the sharp rise in land prices and inflation that ensued due to the deep sleep of the acquiring department.”
The judgment outlined several factors courts should consider when determining a property’s potential value, including its proximity to highways, bypasses, industrial zones, transport links and public facilities.
It also said that where a large portion of land is acquired for a single project, individual plots should not be undervalued, while agricultural land located in the midst of commercial development should be assessed in light of its actual development potential.
“Courts occasionally, sensitive to the doctrine of collective justice, strike a balance between public and private interests.”
The bench noted, “immediately, the key in this case was determination of fair compensation for acquired land rather than acquiring it at an improbable or lump sum price.”
“No doubt that acquisition of land in public interest is so sacred but at the same time payment of fair compensation is also unavoidable and inevitable to protect the fundamental right to own and enjoy the property rights,” it further stressed.
The Supreme Court also emphasized the importance of appellate jurisdiction, holding that the right of appeal is a substantive legal right available to an aggrieved party.
“It is a solemn duty of the court to undo injustice caused by patent errors. The Court of Appeals serves as a curative forum to ensure that justice is not compromised by errors in the lower echelons of the judiciary, because an appeal is not merely a procedural step but a substantive right of a litigant proceeding in continuation of the original case.”
The judgment further recognized property rights as a universally accepted basic human right.
“As mandated in Article 23 of the Constitution of the Islamic Republic of Pakistan 1973, (Constitution), every citizen has the right to acquire, hold and dispose of property in any part of Pakistan, subject to the Constitution and any reasonable restrictions imposed by law in the public interest, whereas Article 24 emphasizes that no person shall be deprived of his property except in accordance with law, and no property shall be acquired in accordance with law. to a public purpose and except by the statutory authority which therefore allows for compensation and either determines the amount of compensation or specifies the principles for and the manner in which compensation is to be determined and given.”
