SMT. INDUMATI CHITALEY vs GOVERNMENT OF INDIA & ANR.

The Supreme Court addressed the determination of compensation under the Land Acquisition Act, 1894, specifically Section 23(1), in a case involving agricultural land acquired for government use. The Court held that the High Court erred in deducting developmental costs on a per-acre basis, emphasizing that compensation should reflect the agricultural nature of the land rather than a square foot basis, which is deemed illegal. The Court affirmed the market value of the land at Rs. 5,000 per acre, rejecting the High Court's valuation method and directing appropriate compensation adjustments.