Ninala Jayasurya, J.

1) The State aggrieved by the Order dated 22.09.2014 in LAOP No.2 of 2011 on the file of the Court of the V Additional District Judge And Sessions Judge-Cum-Motor Accidents Claims Tribunal, Nellore, filed the present Appeal.

2) For better appreciation of the case, the parties are referred to as they are arrayed in the L.A.O.P.

3) Heard Mr.T.Vishnu Teja, learned Special Government Pleader, attached to the office of the learned Advocate General for the appellant. Also heard Mr.K.G.Krishna Murthy, learned Senior Counsel appearing on behalf of the respondents. Perused the material on record.

4) For the purpose of Kandaleru Project a Notification under Section 4 (1) of the Land Acquisition Act, 1894 (for short ―the Act‖) was issued on 21.03.2007. The Draft Declaration under Section 6 of the Act was published on 04.10.2007. Pursuant to the said Draft Notification, the structures of the respondents / claimants situated in Regadapalli Village of Rapur Mandal were acquired. The Land Acquisition Officer after conducting enquiry, passed Award No.3/2009-10, dated 25.09.2009 determining the compensation / value of the structures by taking into consideration its nature and the plinth area.

5) Aggrieved by the value / compensation fixed by the LAO, the respondents / claimants while receiving the same under protest, invoked Section 18 of the Act. Before the Reference Court on behalf of the respondents / claimants PWs 1 to 3 were examined and Exs.A1 and A2 were marked. On behalf of the Referring Officer, R.W.1 was examined and Ex.B1 i.e., Award dated 25.09.2009 was marked. The learned Reference Court vide order under appeal enhanced the market value of the structures per sq.mtr., by 150% over and above the market value fixed by the LAO. It had also granted the statutory benefits on the enhanced market value.

6) Mr.Vishnu Teja, learned counsel for the appellant made elaborate submissions contending that the order under appeal is unsustainable, contrary to law and liable to be set aside. He submits that the enhancement of market value by the Reference Court is highly excessive, without any valid basis and therefore liable to be interfered with. He also contends that the Reference Court on an erroneous appreciation of the matter went wrong in coming to a conclusion that the value fixed by the LAO appears to be very low and arbitrary. He submits that the LAO determined the market value on the basis of the estimates prepared by the Engineering Wing of the Irrigation and Power Department, whereas the estimates (Ex.A1) relied on by the respondent / claimants were prepared by a private Civil Engineer, and the learned Reference Court has committed grievous error in relying on Ex.A1 for enhancement of the market value. He also contends that in Land Acquisition matters the Court is required to fix just and reasonable compensation, whereas in the present case, the Reference Court enhanced the Market Value of the structures by 150% over and above Market Value fixed by the LAO, without assigning any reasons and therefore, the said fixation warrants interference by the Appellate Court.

7) The learned Special Government Pleader further submits that though the LAO fixed the market value of the structures on the basis of estimates prepared by Engineering Wing of Irrigation and Power Department, the same were not filed along with the Award copy (Ex.B1). He submits that the said estimates are very much essential for arriving at just and reasonable compensation. Therefore, the same are filed as additional evidence vide I.A.No.1 of 2025 and urges for receiving the same. He also contends that a bare perusal of Ex.A1 would disclose the irregularities / mischief committed by the private Engineer (PW2) in preparing the estimates. In the light of the additional evidence / material which is sought to be taken on record, and as the enhancement of the market value by the learned Reference Court by 150% per square meter over and above the market value fixed by the LAO is not sustainable, he prays for remand of the matter by duly setting aside the order under Appeal.

8) Per contra, Mr.K.G.Krishna Murthy, learned Senior Counsel appearing for the respondents / claimants strenuously contended that the order of Reference Court is valid and the conclusions recorded therein are arrived at on thorough appreciation of evidence on record and, therefore, the same warrants no interference by this Court. Referring to the relevant depositions of the witnesses and the documentary evidence available on record, the learned counsel would submit that the respondents in fact claimed 300% more over and above the market value fixed by the LAO, but the Reference Court enhanced the market value of the structures only 150% over and above the value fixed by the LAO. He submits that the fixation of the market value on the basis of the estimates prepared by Engineering Wing of Irrigation and Power Department, which is filed as additional evidence, is not correct as the same cannot be a valid basis for determination of the market value. In elaboration, he submits that the said estimates were prepared by the beneficiary Department, whereas as per the Government Orders in G.O.Ms.No.291, dated 05.08.1982, R&B Department was required to prepare estimates for determination of the market value. That apart, the learned senior counsel contends that even the said estimates are very much available at the time of adjudication of the matter by the Reference Court and as the appellant failed to adduce evidence at the relevant point of time, the appellant cannot seek to receive the same in a casual manner.

9) The learned Senior Counsel further contends that the present appeal was filed in the year 2015 and after a long lapse of time, that too in the middle of the arguments, an Interlocutory Application seeking to receive the additional evidence was filed and the relief sought for cannot be granted, more particularly in view of the settled Law that such an application cannot be allowed unless the requirements stipulated in Order 41 Rule 27(1)(aa) of CPC are fulfilled. He submits that nothing is stated in the affidavit filed in support of the I.A., which would give an indication atleast that the additional evidence sought to be received was not within the knowledge of the department / authorities or that the same could not, even after exercise of due diligence, be produced at the time of consideration of O.P., by the learned Reference Court. In essence, his contention is that as the estimates prepared by the Engineering Wing of Irrigation and Power Department, are very much available with the LAO, such evidence cannot be said to be not within the knowledge of the Department or that the same could not be produced after exercise of due diligence, at the time of examination of the claim for enhancement by the Reference Court and therefore, the prayer for remand for redetermination of the market value of the structure on the basis of the said estimates, several years after the acquisition would cause further hardship and serious prejudice to the claimants. Accordingly, he seeks dismissal of the application I.A.No.1 of 2025 as also the appeal contending that the same devoid of merits and the market value enhanced by the Reference is just and reasonable.

10) In reply to the said contentions, learned Special Government Pleader would submit that due to change of officers, the relevant evidence could not be placed on record and the estimates which are the basis for determination of the Market Value by the LAO are filed as additional evidence, but not any new material and the said estimates would enable the Court to examine the correctness of the market value fixed by the LAO. He submits that the justification for filing the I.A. is clearly set out in the affidavit filed by the new incumbent, who after going through the entire record and with due diligence filed the documents / estimates prepared by the Engineering Wing of Irrigation and Power Department as an additional evidence. He submits that in fact, there is no limitation prescribed under Order 41, Rule 27 CPC and therefore, the submission to the effect that the application to receive the additional evidence was filed at a belated stage / after long lapse of time, merits no consideration. Placing reliance on the decisions of the Hon’ble Supreme Court reported in Sanjay Kumar Singh Vs State of Jharkhand((2022) 7 SCC 247) ; Shalimar Chemical Works Ltd., Vs Surendra Oil and Dal Mills (Refineries) and Ors.,( (2010) 8 SCC 423) and Malayalam Plantations Ltd., Vs State of Kerala and Another((2010) 13 SCC 487), the learned counsel prays for allowing the appeal and to remand the matter for determination of the market value afresh, by the Reference Court.

11) On an appreciation of the rival contentions, the points that arise for adjudication by this Court are –

                  1) Whether the market value fixed by the Reference Court is not just, or reasonable, highly excessive, without valid basis and as such the order under appeal is liable to be interfered with?

                  2) Whether the relief sought for in I.A.No.1 of 2025 be granted and the additional evidence be received in the facts and circumstances of the case?

                  3) To what relief?

12) Before dealing with Point No.1, it is deemed appropriate to consider the contentions addressed by the learned counsel on both sides with reference to I.A.No.1 of 2025 and answer Point No.2.

Point No.2:

13) The basic facts with reference to the purpose of acquisition and the issuance of Section 4 (1) Notification dated 24.03.2007 and passing of Award dated 25.09.2009 (Ex.B1) are not in dispute. It is also not in dispute that against the order of the Reference Court dated 22.09.2014, the present appeal was preferred in the year 2015. More than 10 years have gone by and in the connected appeal, an application I.A.No.1 of 2025 to receive additional evidence was filed under Order 41 Rule 27 (1)(aa) of CPC on 29.07.2025 during the course of hearing. Be that as it may.

14) Order 41 of CPC deals with appeals from original decrees.

15) Order 41, Rule 27 of CPC deals with production of additional evidence in appellate Court. For ready reference, the same is extracted hereunder:

                  27. Production of additional evidence in Appellate Court.—(1) The parties to an appeal shall not be entitled to produce additional evidence, whether oral or documentary, in the Appellate Court. But if-

                  (a) the Court from whose decree the appeal is preferred has refused to admit evidence which ought to have been admitted, or

                  (aa) the party seeking to produce additional evidence, establishes that notwithstanding the exercise of due diligence, such evidence was not within his knowledge or could not, after the exercise of due diligence, be produced by him at the time when the decree appealed against was passed, or

                  (b) the Appellate Court requires any document to be produced or any witness to be examined to enable it to pronounce judgment, or for any other substantial cause, the Appellate Court may allow such evidence or document to be produced, or witness to be examined.

                  (2) Wherever additional evidence is allowed to be produced by an Appellate Court, the Court shall record the reason for its admission.‖

16) A reading of the above extracted provision of law i.e., Rule 27(1)(aa), makes it clear that the party, who is seeking to produce additional evidence, has to establish that despite exercise of due diligence, such evidence was not within the knowledge or that the same could not, after the exercise of due diligence could not be produced by him, at the time when the decree appealed against was passed.

17) It is not in dispute that the documents / estimates filed as additional material / evidence, are very much within the knowledge of the department / authorities i.e., LAO/Special Deputy Collector and it is not as if even after exercise of due diligence the said evidence was not within the knowledge of the appellant or that the same could not be produced after exercise of due diligence, much less that it was obtained after exercise of due diligence from the custody of the other department. It may be pertinent to mention here that in fact, in the order under challenge this aspect of not filing / exhibiting the estimates, which were prepared by the engineering team of Irrigation and Power Department, which is stated to be the basis for determination of Market Value by the LAO, was specifically discussed by the learned Reference Court. However, the appellant did not choose to file any application to receive the additional evidence along with appeal filed in the year 2015. Though no specific time limit is stipulated for filing application under Order 41 Rule 27 of CPC, the application to receive additional evidence, cannot be ordered, unless the Court is satisfied that the reasons / explanation for non- production of the evidence is in terms of Order 41 Rule 27(1)(aa) of CPC. In the case on hand, the question of the evidence i.e., the estimates prepared by the Irrigation and Power Department is not within the knowledge of the Department / appellant or that even after exercise of due diligence could not be produced before the Reference Court does not arise at all.

18) At this juncture, it may be appropriate to refer to the decisions cited by the learned counsel for the appellant.

19) In Sanjay Kumar Singh’s case (referred to supra), the Hon’ble Supreme court was dealing with an order passed by the High Court of Jharkhand at Ranchi in a First Appeal arising out of the proceedings under the Land Acquisition Act. A reference under Section 18 of the Act was rejected and aggrieved by the same, the original claimant / land owner preferred an appeal before the High Court. He also moved an application to receive the additional evidence under Order 41, Rule 27 of CPC and while deciding the appeal, the High Court dismissed the said application. The Hon’ble Supreme Court while opining that the appellate Court should not travel outside the record of the lower court and cannot take any evidence in appeal and Order 41, Rule 27 of CPC, as an exception enables the appellate Court to take additional evidence in exceptional circumstances, that the appellate Court may permit additional evidence if the conditions laid down in the said Rule are found to exist and the parties are not entitled, as of right, to the admission of such evidence, observed that where the additional evidence sought to be adduced removes the cloud of doubt over the case and the evidence has a direct and important bearing on the main issue in the suit and interest of justice clearly renders it imperative that it may be allowed to be permitted on record, such an application may be allowed.

20) In the case on hand, as noted earlier, the application to receive the additional material / evidence was filed under Order 41 Rule 27(1) (aa) of CPC. In such an event, the Court is required to see whether the material sought to be received as additional evidence, could not be produced at the time of the proceedings before the Reference Court at the first instance, as it was not within the knowledge of the party i.e., the appellant-State herein or that despite exercise of due diligence, the same could not be produced by it, at the time when the decree appealed against was passed. That apart, from a reading of the judgment in Sanjay Kumar Singh’s case referred to supra, no argument with reference to the power of the appellate Court under Order 41 Rule 27 (1) (aa) of CPC appears to have been addressed.

21) In Malayalam Plantations Ltd., the Hon’ble Supreme Court while setting aside the order of the High Court of Kerala, opined that when application for receipt of additional evidence under Order 41 Rule 27 of C.P.C., was filed, it was the duty of the High Court to deal with the same on merits. It also stated that under Oder 41 Rule 27, the additional evidence could be adduced in one of the three situations, viz., (a) whether the trial court has illegally refused the evidence although it ought to have been permitted (b) whether the evidence sought to be adduced by the party was not available to it despite the exercise of the due diligence; (c) whether the additional evidence was necessary in order to enable the appellate court to pronounce the judgment or any other substantial cause of similar nature. In Para No.17, the Hon’ble Apex Court held as follows:

                  ―It is equally well settled that additional evidence cannot be permitted to be adduced so as to fill in the lacunae or to patch up the weak points in the case. Adducing additional evidence is in the interest of justice. Evidence relating to subsequent happenings or events which are relevant for disposal of the appeal, however, it is not open to any party, at the stage of appeal, to make fresh allegations and call upon the other side to admit or deny the same. Any such attempt is contrary to the requirements of Order 41 Rule 27 C.P.C. Additional evidence cannot be permitted at the appellate stage in order to enable other party to remove certain lacunae present in that case.‖

22) In Shalimar Chemical Works Ltd., referred to supra, the Hon’ble Supreme Court was dealing with an appeal against the judgment and order of the erstwhile High Court of Andhra Pradesh at Hyderabad, examining the matter with reference to Order 41 Rule 27(1)(b) of C.P.C., the Hon’ble Supreme Court set aside the order passed by the Division Bench.

                  Be that as it may.

23) In State of Karnataka and Another v. K.C.Subramanya and Others((2013) 13 SCC 468), the Hon’ble Supreme Court had an occasion to examine Order 41 Rule 27 (1) (aa) of CPC, in an appeal filed against the judgment of High Court of Karnataka. Referring to the said provision, the Hon’ble Supreme Court, dismissed the appeal inter alia holding as follows:

                  ―4………

                  On perusal of this provision, it is unambiguously clear that the party can seek liberty to produce additional evidence at the appellate stage, but the same can be permitted only if the evidence sought to be produced could not be produced at the stage of trial in spite of exercise of due diligence and that the evidence could not be produced as it was not within his knowledge and hence was fit to be produced by the appellant before the appellate forum.

                  5. It is thus clear that there are conditions precedent before allowing a party to adduce additional evidence at the stage of appeal, which specifically incorporates conditions to the effect that the party in spite of due diligence could not produce the evidence and the same cannot be allowed to be done at his leisure or sweet will.

                  6. In the instant matter, the appellants are a public authority and have sought to produce a road map which, it is unbelievable, was not within the knowledge of the appellants indicating a road to the disputed land. Therefore, the rejection of the application of the appellants to rely on the said map has rightly not been entertained at the stage of first appeal. The impugned order thus does not suffer from legal infirmity so as to interfere with the same.‖

24) In Kirpa Ram (deceased) Through Legal Representatives and Others((2021) 13 SCC 57), a three Member Bench of the Hon’ble Supreme Court was dealing with an appeal against the concurrent findings in a suit for perpetual injunction. Referring to the facts of the case and disposal of appeal by the appellate Court without passing any order on the application filed under Order 41, Rule 27 of CPC, for permission to lead additional evidence, the Hon’ble Supreme Court opined that ―once the parties have understood the said controversy and had adduced evidence before the Trial Court, the appellant cannot be permitted to produce additional evidence in the first appeal.‖

25) N.Kamalam (dead) and Another v. Ayyasamy & Another(2001 (5) Supreme 689) is a case wherein the appellant before the Hon’ble Supreme Court, suffered a decree in 1983, filed an appeal before the High Court in April, 1983. In the said appeal, an application for permission to adduce the additional evidence under Order 41 Rule 27 of CPC, was filed in August, 1993. The said application and the appeal were dismissed. The Hon’ble Supreme Court upheld the decision of the High Court inter alia opining that a plain reading of Order 41 Rule 27 would depict that rejection of the claim for production of evidence after a period of ten years from the date of filing of the appeal cannot be termed to be erroneous or an illegal exercise of discretion. In the said judgment, the Hon’ble Apex Court opined that the provisions of Order 41 Rule 27 of CPC, has not been engrafted in the Code so as to patch up the weak points in the case and to fill up the omissions in the Court of Appeal. It does not authorize any lacuna or gaps in evidence to be filled up.

26) In the light of the judgments referred to above, the application seeking to receive additional material / evidence filed 10 years after filing of the appeal that too without fulfilling the requirements of Order 41, Rule 27 (1) (aa) of CPC are deserves no consideration.

27) Even assuming that the said material is required to enable the Court to render complete justice, at this length of time, in the considered opinion of this Court, no useful purpose would be served as the subject matter structures of the respondents / claimants were acquired pursuant to the Notification issued on 24.03.2007 i.e., more than 18 years ago. The Reference Court passed the order and decree under appeal on 22.09.2014, more than a decade ago. It is not known as to whether the officers who prepared the estimates on behalf of the Irrigation and Power Department are still in service. The submission to remand the matter causes more injustice to the respondents / claimants who lost their property, yet not received the compensation so far. Be that as it may. After considering the submissions made by the learned Special Government Pleader for the appellant, this Court is of the considered opinion that the appellant had not exercised due diligence and to satisfy the requirements / conditions stipulated in Order 41, Rule 27 (1) (aa) of CPC and in the light of the decisions of the Hon’ble Supreme Court in K.C.Subramanya and N.Kamalam cases(referred to supra), the appellant is not entitled for the relief sought for in I.A.No.1 of 2015 and the same is therefore dismissed. Point No.2 is answered accordingly against the appellant.

Point No.1

28) It is the contention of the learned Special Government Pleader that the compensation as enhanced by the Reference Court is without any valid basis and highly excessive.

29) To substantiate their claim for enhancement, the respondents as mentioned supra, examined P.Ws.1 to 3 and got marked Exs.A1-Abstract estimates and Ex.A2-Certified copy of the Judgment in L.A.O.P.No.891 of 1999 dated 25.02.2002. On behalf of the Referring Officer, R.W.1 i.e., the Special Collector was examined and Ex.B1-Award was got marked.

30) As per the judgment of Hon’ble Supreme Court in Chimanlal Hargovinddas v. Spl.Land Acquisition Officer, Poona (1988 (3) SCC 751)], mere marking of Ex.B1-Award in the absence of oral and documentary evidence supporting the fixation of market value by the Land Acquisition Officer would not enure to the benefit of the State. Be that as it may.

31) It is trite Law that the claimant has to prove its claim and this Court in the absence of any evidence on behalf of the appellant, has no option except to look into the evidence adduced by the respondents / claimants. In support of the case of the respondents, claimant No.14 was examined as P.W.1. In his affidavit filed in lieu of chief examination, he stated that the LAO, failed to estimate the cost of material and transportation charges of the material for construction of structures at the time of passing of Award dated 25.09.2009, that the Irrigation and Power Department did not prepare the individual estimations and failed to take the individual structure particulars like wood, material used for the structures and failed to assess the real market value. He categorically stated that the sand, cement and steel for construction of the houses were obtained from 70 kms., distance. However no material to that effect is as filed. He further deposed that the market value of the structures adopting model estimates and the value prepared by the Irrigation and Power Department i.e., requisition department itself is contrary to principles of natural justice etc., and that the value of structures were increasing from year to year @ 20% p.a. Nothing much was elicited in the cross examination of the said witness (P.W.1), except making some suggestions. P.W.2., who was a licensed Civil Engineer in his chief affidavit stated that he prepared 347 estimations covering all varieties of constructions and that he found the value of the structures 2 to 3 times over and above the value fixed by the LAO and that he prepared the estimations basing on the SSR rates of 2007-2008. Nothing was elicited in the cross examination of P.W.2, much less with regard to the correctness or otherwise of the estimates prepared by him. P.W.2 denied the suggestion that he was not competent to assess the value of the structures and that the estimations are not correct.

32) P.W.3, who was a resident of neighbouring village i.e., Rekalagunta in his evidence stated that his lands and structures were acquired for the purpose of construction of Somasila Project under Teluguganga Project and as the compensation awarded was low, an application under Section 18 of the Act was filed and the learned Reference Court, after due examination of the matter, enhanced the market value by 100% in L.A.O.P.No.891 of 1999 (Ex.A2 dated 25.02.2002). Nothing much was elicited in the cross examination even in respect of the said witness.

33) Under the said circumstances, the contention that the order under appeal is without any valid basis, cannot be accepted. However, it is pertinent to note that the learned Reference Court while disposing of the O.P., enhanced the market value of the structures per sq. mtr., per 150% over and above the market value fixed by the Land Acquisition Officer, without assigning specific reasons. Even if the evidence of P.W.2 is taken into account, the value of the structures could be two to three times more over and above the value fixed by the Land Acquisition Officer. Therefore, in the considered opinion of this Court, the fixation of Market Value of the structures in terms of Ex.A2 i.e., 100% per square meter over and above the market value fixed by the Land Acquisition Officer would be just and reasonable. Accordingly, the point No.1 is answered.

34) In the result, I.A.No.1 of 2025 is dismissed and the appeal is allowed in part, by modifying the market value of the subject matter structures from 150% per sq. mtr., to 100% over and above the market value fixed by the Land Acquisition Officer. Rest of the order under appeal stands confirmed. No costs.

                  As a sequel, miscellaneous applications if any, pending shall stand closed.