Judgement K. N. SINGH, J.:- This First Appeal is directed against the judgment and decree of the District Judge, Nainital, awarding a sum of Rs. 15,856.56 P. as compensation to the appellants. 2. Sukhnandan Prasad, deceased, was the owner of a grove having an area of 3 acres situate within the Municipal limits of Kashipur in District Nainital. On 7-2-1961, a Notification under S.4 (1) of the Land Acquisition Act, 1894 was issued for acquiring an area of 0.459 acres (20,000 S. Ft.) out of the grove of Sukhnandan Prasad for the construction of building and staff quarters of the Post and Telegraph Department. Sukhnandan Prasad died whereupon his heirs, the appellants filed objection under S.5-A of the Act resisting the acquisition proceedings on the ground that a number of samadhis existed on the land in question. The objectors filed a writ petition also in this court, under Art.226 of the Constitution challenging the validity of the acquisition, but the writ petition was dismissed by this Court. Thereafter the land acquisition proceedings were completed. The Special Land Acquisition Officer gave his award on 24-3-1965, awarding the claimants a sum of Rupees 3109-73 P. as compensation for the land, Rs. 439-00 for the trees and Rs. 106-56 P. for the boundary wall. In all the claimants were awarded a sum of Rupees 3655-29 P. as compensation. On the claimants application under S.18 of the Act reference was made to the District Judge for determining the compensation. Before the District Judge the appellants claimed Rs. 30,000/- for the land, Rupees 4600-00 for the trees and Rs. 1500-00 for the costs of the construction existing on the land, Rs. 5525-00 for reduction in value of the adjoining land and Rupees 8750-00 for the potential value of the land. In all the claimants claimed a sum of Rs. 49,875-00 as compensation. The District Judge awarded Rs. 15,000/- as compensation for the land, Rs. 750-00 for the trees standing on the land and Rs. 106-56 P. for the boundary wall. In all the District Judge awarded a sum of Rs.15,856-56 p. as compensation to the appellants. As they were not satisfied with the compensation awarded to them they have preferred this appeal against the judgment of the District Judge. 3. 750-00 for the trees standing on the land and Rs. 106-56 P. for the boundary wall. In all the District Judge awarded a sum of Rs.15,856-56 p. as compensation to the appellants. As they were not satisfied with the compensation awarded to them they have preferred this appeal against the judgment of the District Judge. 3. Learned Counsel for the appellants urged that the District Judge failed to determine the market value of the land correctly and the compensation awarded is wholly inadequate. He further urged that the land was situated in the heart of the Municipal area and it had value of potential building site, the District Judge should have awarded compensation treating the land as potential building site. S.23 of the Land Acquisition Act, 1894 lays down that in determining the amount of compensation to be awarded for the land acquired under the Act, the Court shall take into consideration the market value of the land at the date of the publication of the notification under S.4(1) of the Act. For determining the market value several factors have to be considered. The possibility of the use of the land in near future with all its advantages has to be taken into account in determining the market value. In Narayana Gajapatiraju v. Revenue Divisional Officer, Vizagapatnam (AIR 1939 PC 98), the Privy Council held: "For the land is not to he valued merely by reference to the use to which it is being put at the time at which its value has to be determined ........ but also by reference to the uses to which it is reasonably capable of being put in the future. It is possibilities of the land and not its realized possibilities that must be taken into consideration". 4. In Raghubans Narain Singh v. U.P. Government, AIR 1967 SC 465 , the Supreme Court held (para 5) : "Market value on the basis of which compensation is payable under S.23 of the Act means the price that a willing purchaser would pay to a willing seller for a property having due regard to its existing condition, with all its existing advantages, and its potential possibilities when laid out in its most advantageous manner, excluding any advantages due to the carrying out of the scheme for the purposes for which the property is compulsorily acquired." 5. In Collector, Raigarh v. Dr. In Collector, Raigarh v. Dr. Hari Singh Thakur ( AIR 1979 SC 472 ) the Supreme Court while considering the question of potential value of the land acquired observed as under (para 5):- "The question as to whether a land has potential value as a building site or not is primarily one of fact depending upon several factors such as its condition and situation, the user to which it is put or is reasonably capable of being put, its suitability for building purposes, its proximity to residential. commercial industrial areas and educational, cultural or medical institutions, existing amenities like water, electricity and drainage and the possibility of their future extension, whether the nearby town is a developing or a prospering town with prospects of development schemes and the presence or absence of pressure of building activity towards the land acquired in the neighbourhood thereof". 6. Market value of the land in dispute is to be determined in the background of the principles laid down by the Privy Council and the Supreme Court. In the instant case there is no dispute that the land is situate within the municipal limit. It abuts on the main road of the town of Kashipur. Exhibit 1 is the site plan prepared by Roop Chand, P.W 1. On a perusal of the same we find that on the south of the land there are a number of shops which face station road. On its west there is a road and across the road there is the vegetable market of Kashipur and thereafter there is a Dharamshala and adjoining to the vegetable market there is a school run by the Nagar Palika, Kashipur. There area number of other shops in the locality. On the southern side across the road there are 35 shops constructed by the Municipal Board, Kashipur. There are three school buildings on the eastern side of the land in dispute. On the northern end of the plot in dispute there are a number of shops which abut on cinema road. Mithilesh Kumar, D.W. 4, in his deposition stated that the land in dispute is surrounded by houses and shops, Tehsil building and schools. There are three school buildings on the eastern side of the land in dispute. On the northern end of the plot in dispute there are a number of shops which abut on cinema road. Mithilesh Kumar, D.W. 4, in his deposition stated that the land in dispute is surrounded by houses and shops, Tehsil building and schools. Mithilesh Kumar, who is one of the appellants stated that prior to the issue of the notification under S.4 (1) of the Act, he had submitted a plan to the Municipal Board for construction of 26 shops on the land in dispute which had been approved by the Municipal Board but before he could construct those shops the land acquisition proceedings were taken. The evidence on record clearly shows that the land is situated in the heart of the city in commercial area, having potential of building site. In fact the appellants had already submitted plan for construction of shops for letting out on rent. There is no escape from the conclusion that the land in dispute was a potential building site. 7. The parties filed exemplars for the purpose of determining the market value of the land. These exemplars are as follows:- 1. Sale deed executed on 17-8-1957 by Sardar Bahadur in favour of Sita Ram transferring 18 acres of land for a sum of Rs. 10,500/-. The rate according to this deed comes to Rs. 1/30 p. per s. ft. 2. Sale deed executed by Jeet Lal on 24-4-1958 in favour of Raj Narain transferring 1750 s.ft. land for Rs. 4,300/- at the rate of Rs. 2/50 p. per sq. fit. 3. Sale deed executed by Shiv Lal on 24-10-1958 in favour of Kastoori Lal, transferring an area of 2660 sq. ft. for a sum of Rs. 5400/- at the rate of 2/- per sq, ft. 4. Sale deed executed by Shiv Lal on 9-6-1960 in favour of Smt. Kamla Devi transferring an area of 1500 sq. ft. for a sum of Rs. 4500/- at the rate of 3/- per sq. ft. : 5. Sale deed executed by Shiv Lal in favour of Ram Pyare Lal in 26-12-1969 transferring an area of 1800 sq. ft. for a sum of Rs. 3400/- at the rate of Rs. 1-90p. per sq. ft. 6. ft. for a sum of Rs. 4500/- at the rate of 3/- per sq. ft. : 5. Sale deed executed by Shiv Lal in favour of Ram Pyare Lal in 26-12-1969 transferring an area of 1800 sq. ft. for a sum of Rs. 3400/- at the rate of Rs. 1-90p. per sq. ft. 6. Sale deed executed by Munshi Ram on 18-12-1961 in favour of Smt. Hajra Begum transferring land having an area of 875 sq. ft. for a sum of Rs. 3000/- at the rate of Rs. 3-50 per sq. ft. 7. Sale deed executed by Sunder Lal on 12-3-1962 in favour of Haji Raza Husain transferring an area of 2480 sq. ft. for Rs. 5500/- at the rate of Rs. 2-90 per sq. ft. 8. Sale deed executed by Jagdish Kumar on 20-9-1962 in favour of Amar Nath Tula Ram transferring an area of 728 sq. ft. for a sum of Rs. 12,000/- at the rate of Rs. 16.50 p. per sq. ft. 8. The sale deeds executed by Sardar Bahadur, Jeet Lal, Shiv Lal, Sunder Lal and Jagdish Kumar, at Serial No. 1, 2, 3, 7 and 8 cannot be taken into account as they were executed in 1957, 1958 and 1962, i.e. before or prior to the date of acquisition. It would not be safe to rely on those sale deeds as they do not evidence the prevailing market price of land on 7-2-1961, when the notification under S.4(1) was issued. 9. The three sale deeds at Serial Nos. 4, 5 and 6 are nearest in time to the date of S.4 Notification. We think these sale deeds are relevant which may provide guidance for determining the market value of the land. Shiv Lal executed two sale deeds one in June 1960 in favour of Kamla Devi and the other in Dec. 1960 in favour of Ram Pyare Lal transferring an area of 1500 sq. fit. at the rate of Rs. 3/- per sq. ft. and 1800 sq. ft. at the rate of Rs. 1-90 P. per ft. respectively. Prem Prakash, P.W. 3, son of Shiv Lal, appeared in witness box, he stated that the plots in dispute belonging to the appellant was better in quality than that sold by his father, in favour of Smt. Kamla Devi and Ram Pyare Lal. ft. and 1800 sq. ft. at the rate of Rs. 1-90 P. per ft. respectively. Prem Prakash, P.W. 3, son of Shiv Lal, appeared in witness box, he stated that the plots in dispute belonging to the appellant was better in quality than that sold by his father, in favour of Smt. Kamla Devi and Ram Pyare Lal. He further stated that the land which was transferred by his father was away from the market whereas the acquired land was adjacent to the market. The testimony of Prem Prakash and the rate at which the two sale deeds were executed by Shiv Lal show that immediately before the date of acquisition of the land in dispute a purchaser was willing to offer price at least at the rate of Rs., 1-90 p. per sq. ft. in the city of Kashipur. The land which was the subject matter of sale deed executed by Munshi Ram is quite adjacent to the land in dispute. Munshi Ram sold an area of 875 sq. ft. at the rate of Rs. 3-50 per sq. ft. on 18-12-1961. The three sale deeds, two executed immediately before the notification issued under S.4 (1) of the Act and the sale deed executed in Dec., 1961 show that the prevailing price of the land was higher than that the market value determined by the District Judge. The land which was the subject matter of the sale-deeds executed by Shiv Lal and Munshi Ram was small in area while the land which has been acquired is large in area, therefore the rate at which the smaller area of land was sold cannot be applied to larger area of land. It is a matter of common knowledge that a small piece of land fetches higher price than a large area of land, therefore it is not possible to determine the market value of the land on the rate at which the land under the aforesaid sale-deeds was sold. We have to make some allowance for the large area of land in determining the market value. The fact however remains that the appellants land is situated within commercial area of the city and it was proposed to be put to commercial use by constructing shops which would have given good return to the appellants. We have to make some allowance for the large area of land in determining the market value. The fact however remains that the appellants land is situated within commercial area of the city and it was proposed to be put to commercial use by constructing shops which would have given good return to the appellants. Having regard to these facts and circumstances we are of the opinion that it would be just and fair to determine the market value of the land at the rate of Rs. 1-50 p. per sq. ft. The appellants are thus entitled to receive Rs. 30,000/- as compensation for the land. 10. Learned Counsel for appellants urged that a portion of 20.000 sq. ft. has been separated from the appellants grove which constituted one compact plot having an area of three acres. The severance of the land in dispute from the rest of the land has resulted into reducing the value and utility of the remaining land. On a perusal of the map (Ex.1), we find that the land in dispute is a portion of a plot having an area of three acres and the appellants had constructed shops on the southern side and the northern side of the big plot. The appellants had already got a plan sanctioned by the Municipal Board for the construction of shops on the western side of the plot over the portion which has been acquired from them. After the acquisition of 20,000 sq. ft. land the remaining area is deprived of frontage on the road. This would certainly diminish the value of the land to some extent. However, no evidence was produced to show as to what extent the value of the remaining land had diminished, but still it is difficult to hold that severance of the disputed land has not diminished the value of the remaining land; this is clear on the perusal of Ex.1. In the absence of any positive evidence we consider it just and proper to award a um of Rs. 2000/- as damages sustained by the appellants on account of severance of the land. 11. In the absence of any positive evidence we consider it just and proper to award a um of Rs. 2000/- as damages sustained by the appellants on account of severance of the land. 11. Learned Counsel then urged that the District Judge committed error in assessing compensation for the fruit bearing trees treating the same as fuel wood, he urged that compensation for fruit bearing trees should have been determined by taking into account the annual rental value after capitalising the same by twenty years purchase. He placed reliance on a decision of Madras High Court in V.K. Rajammal v. Headquarters Deputy Collector, Vellore (1914-25 Ind Cas 393) : (AIR 1915 Mad 356 (2)) in support of his contention. In this case the Division Bench of Madras High Court observed that fruit bearing trees likely to bear fruit for a number of years e.g. mango trees should be valued at twenty years annual rental while determining compensation under Section 23 of the Act. 12. It is significant to note that in Rajammals case, market value of the land over which the trees were standing was valued on the basis of capitalisation of rental value. The principle of determining market value on the basis of rental value generally applies to the land which has no potential of building site. Where the value of the land is determined treating the same as potential building site, the principle of capitalisation on the basis of rental value cannot be applied. In State of Madras v. Alameluthayammal, ( AIR 1970 Mad 184 ), a Division Bench held : "If a certain land has been valued as an agricultural land, it is reasonable to ascertain the capitalised income of the fruit bearing trees in which case the period of computation of value should be taken as only ten years. But if the site is valued as a house site, the trees standing thereon cannot be valued on the basis that it is fruit-yielding tree and at best the value of the tree as timber or fuel alone can be taken into account. Otherwise, the valuation will really result in duplication of value." 13. We are in agreement with the view taken in Alameluthayammals case. Otherwise, the valuation will really result in duplication of value." 13. We are in agreement with the view taken in Alameluthayammals case. Since we have determined the market value of the land treating the same as potential building site there is no good reason to assess compensation for the damages caused to the fruit bearing trees on the annual rental value basis. The learned District Judge rightly determined the compensation for the trees on the basis of the value of the wood. The learned Judge awarded a sum of Rupees 750/-, and we find no error in his judgment warranting interference by this Court. The appellants have been awarded a sum of Rs. 106/- as compensation for the boundary wall which was on the western side of the land in dispute. We find no good reason to take a different view or to enhance the compensation. 14. Learned counsel then urged that under Section 23 (2) of the Act the appellants are entitled to 15% solatium on the amount of compensation determined by the Court. S.23 (2) lays down as under : "(2) In addition to the market value of the land, as above provided, the court shall in every case award a sum of fifteen per cent on such market value, in consideration of the compulsory nature of the acquisition." This provision is mandatory in nature. The court is bound to award 15% of the market value of the property acquired as solatium for the compulsory acquisition. But S.23 (2) was not in operation in the State of Uttar Pradesh with effect from 1-9-1954 as the Land Acquisition (U.P. Amendment Act) XXII of 1954 deleted sub-sec.(2) of Section 23. By S.3 of the Land Acquisition (U.P. Amendment) Act No. XXVII of 1972 sub-sec.(2) of S.23 was restored in its application to State of Uttar Pradesh which was enforced on 3-7-1972. No solatium could, therefore, be awarded to a claimant whose land was compulsorily acquired during the period 1st Sept., 1954 to 3rd July, 1972, as during that period the mandatory provision for awarding solatium was not in force. In the instant case the land was acquired in 1961 and the District Judge decided the reference on 12-5-1969. On both these dates S.23 (2) was not in force, consequently the appellants are not entitled to any solatium. In the instant case the land was acquired in 1961 and the District Judge decided the reference on 12-5-1969. On both these dates S.23 (2) was not in force, consequently the appellants are not entitled to any solatium. Learned counsel urged that since during the pendency of the appeal before this Court S.23 (2) was restored, therefore appellants are entitled to its benefit and this Court should award solatium. We are unable to accept this contention. S.3 of the U.P. Act No. XXVII of 1972 by which the sub-sec.(2) of S.23 of the Principal Act was restored was not enforced with retrospective effect. If S.3 of the amending Act 1972 had been retrospective, the appellants would have been entitled to solatium, but the legislative intent is clear that the amending Act was prospective in nature. It is, therefore, not possible to award solatium to the appellants. In first Appeal No. 181 of 1965, State v. Khairunnisa, decided on 29-7-1982 : (reported in AIR 1983 All 320 ). We have taken a similar view, we find no reason to take a different view. 15. Learned Counsel then placed reliance on an unreported decision of the Division Bench of this Court in First Appeal No. 202 of 1975, State of U.P. v. Sarvadeshik Arya Pratinidhi Sabha decided an 24-3-1982, in that case, a Division Bench of this court awarded solatium an the ground that the proceedings for determining compensation were pending before the District Judge on the date when the U.P. Amending Act. No. XXVII of 1972 restored S.23 (2) of the Principal Act. The Bench held that for that reason the District Judge should have awarded solatium to the claimants. The ratio of the Bench decision depends upon the pendency of the reference before the District Judge when the amending provisions came into force. That principle, however, cannot be applied to the instant case as the reference had already been decided prior to the enforcement of the amending Act XXVII of 1972. The Bench decision does not apply to the facts of the instant case. We accordingly hold that the appellants are not entitled to any solatium. 16. In view of the above discussion we hold that the appellants are entitled to a sum of Rs. 30,000/- as compensation for the land in dispute, they are further entitled to a sum of Rs. We accordingly hold that the appellants are not entitled to any solatium. 16. In view of the above discussion we hold that the appellants are entitled to a sum of Rs. 30,000/- as compensation for the land in dispute, they are further entitled to a sum of Rs. 2000/- for the damages caused to the remaining land and Rs. 750/-as compensation for the trees and Rs.106-56 p. as compensation for the boundary wait. In all the appellants are entitled to a sum of Rupees 32,856-65 p. as compensation. The appellants are further entitled to interest at the rate of 6% per annum from the date of award. 17. In the result we allow the appeal partly. The appellants are entitled to their costs. Appeal partly allowed.