MEHTA RAVINDRARAI AJITRAI (DECEASED) THROUGHHIS HEIRS AND L vs STATE OF GUJARAT

The Supreme Court held that under Section 23 of the Land Acquisition Act, 1894, the market value of acquired land is determined by the price at which similar properties change hands in bona fide transactions around the time of the preliminary notification. The Court found that the High Court's reliance on a distress sale was misplaced, as it did not reflect the true market value. The Court allowed the claimants' appeal, establishing that the best evidence of market value comes from comparable sales, specifically citing the sale deed dated April 2, 1957 as the appropriate basis for valuation.