Judgment ( 1. ) IN the appeals preferred by the claimants award dated 21st December, 2000, award dated 15-11-2000 and award dated 16-1-2001 are in question. ( 2. ) MATTER relates to acquisition of land by the Land Acquisition Officer, satna Rewa Railway Link Project Tahsil-Huzur, District-Rewa, the compensation determined with respect to land situated at Village Kheri, Ramkui and Para suharantola,etc. is in question. Land was acquired as per notification dated 20th may, 1985 issued under section 4 (1) read with section 17 (1) of Land Acquisition act. Reference was sought by the owners for enhancement of compensation amount with respect to land acquired under the aforesaid acquisition. Land situated at Village-Kheri 8. 774 hectare was acquired. Land Acquisition Officer as per award dated 26-5-1987 determined the valuation at Rs. 44,632 per acre and Rs. 1,10,240 per hectare. The reference Court has awarded compensation of Rs. 1,20,000 per hectare. In FA No. 363/01 LAO passed award on 26-5-1987 determining the compensation at Rs. 1,10,240 per hectare. Reference Court has determined the valuation at Rs. 2 sq. ft. Aggrieved by the award, the appeals have been preferred by the appellants for enhancement of compensation. ( 3. ) SHRI Atulanand Awasthy, Shri A. K. Pathak and Ms. M. Dadaria, learned counsel appearing for appellants have submitted that the valuation determined by the Reference Court is inadequate, the valuation ought to have been determined at Rs. 5 per sq. ft. considering the development in area and existing user as on the date of acquisition. In addition, taking into consideration the potential user as on the date of acquisition, thus, price of land assessed by Reference Court was not proper considering the development in surrounding areas, some of the land was abutting the National Highway such as Survey No. 46, it was of higher value as compared to the land situated at the distance, that has not been taken into consideration by the Reference Court, there was nothing to discard sale deed (Ex. P/l) dt. 17-7-1984 by which 2500 sq. ft. land was sold for a sum of rs. 25,000 at the rate of Rs. 10 per sq. ft, sale deed (Ex. P/2) dt. 6-7-1984 was also executed before one year of the date of acquisition by which 2400 sq. ft. land was sold for a sum of Rs. 9,600 at the rate of Rs. 4 per sq. ft. , sale deed (Ex. 25,000 at the rate of Rs. 10 per sq. ft, sale deed (Ex. P/2) dt. 6-7-1984 was also executed before one year of the date of acquisition by which 2400 sq. ft. land was sold for a sum of Rs. 9,600 at the rate of Rs. 4 per sq. ft. , sale deed (Ex. P/4) dt. 13. 6. 84 by which 4000 sq. ft. land was sold for a sum of Rs. 19,000 at the rate of rs. 4. 75 per sq. ft. , beside as per sale deed (Ex. P/5) dt. 9-4-1984 land admeasuring 2800 sq. ft. was sold for a sum of Rs. 7,000 at the rate of Rs. 2. 50 per sq. ft. The reference Court has committed error of law while considering the basic valuation register and has acted as if it was acting as an Appellate Court over the award passed by the Land Acquisition Officer, proceedings were the original proceedings and the evidence adduced ought to have been taken into consideration, that has not been done, inadequate compensation has been determined. On the one hand it has been found that there was an error of calculation done while determining the value per acre, on the other hand finding has not been given effect to while ultimately working out the compensation in the award dated 21st December, 2000 passed by the Reference Court. Compensation offered for house and well to Arjundas is also inadequate. Statement and report of valuer Vinod Singh (CW. 1) has not been considered by Reference Court. ( 4. ) SHRI Sudhir Shrivastava, learned counsel appearing for respondents/railway has submitted that no case for interference in appeals is made out, the sale deeds were for smaller plots of land, that could not have ormed the basis for determination of price for per acre or per hectare of the land, even if the land was capable of being used as house site , 50%-60% deduction is permissible to be made for development, that aspect when taken into consideration, the price/compensation would not come more than what has been awarded by the Reference Court. ( 5. ( 5. ) IT is apparent that Land Acquisition Officer as well as the Reference court have found that land was capable of being used as house site, land was having potential value as on the date of issuance of notification under section 4 of land Acquisition Act on 20th May, 1985. While determining the compensation reference Court has acted upon the basic value register as apparent from the discussion made in para 49 onwards in award dated 21st December, 2000. Similar is the position in the awards assailed in other appeals. Basic valuation register cannot be the basis for determination of price as held by Apex Court in land Acquisition Officer, Eluru and others vs. Jasti Rohini (Smt.) and another, (1995) 1 SCC 717 . ( 6. ) THE Reference Court has acted as if it was hearing an appeal against the decision, findings recorded by the Land Acquisition Officer too have been resorted to whereas there should have been independent application of mind to the evidence adduced before the Reference Court. Reference case is not an appeal, the evidence on record of the case of LAO has to be proved by independent evidence, the reference has to be treated as original proceedings, it has to be established that price offered is inadequate as held by Apex Court in chimanlal Hargovinddas vs. Special Land Acquisition Officer, Poona and another, AIR 1988 SC 1652 and in Kiran Tandon vs. Allahabad Development authority and another, (2004)10 SCC 745 = AIR 2004 SC 2006 . ( 7. ) IT is well settled that price has to be determined applying the test of a prudent buyer as held by Apex Court in Special Deputy Collector and another vs. Kurra Sambasiv Rao AIR 1997 SC 2625 . Sale deeds relating to closest or nearest piece of land carries more value as laid down in M/s Printers House Pvt. Ltd. vs. Mst. Saiyadan (Deceased) by LRs. and others, AIR 1994 SC 1160 . Similarly potentiality and nature is to be seen as laid down in Panna Lal Ghosh and others vs. Land Acquisition Collector and others, AIR 2004 SC 1179 . The distance of the land covered under the sale deeds from the land acquired is also relevant consideration as held in Smt. Tribeni Devi and others vs. Collector, Ranchi, AIR 1972 SC 1417 . The distance of the land covered under the sale deeds from the land acquired is also relevant consideration as held in Smt. Tribeni Devi and others vs. Collector, Ranchi, AIR 1972 SC 1417 . Potential value on the date of notification under section 4 is relevant not the subsequent user as held in Special LAO, Karnataka Housing board vs. P. M. Mallappa and others, AIR 1997 SC 3661 . In case of acquisition of large piece of land, grant of compensation per sq. ft was held to be illegal as held in Indumati Chitaley vs. Government of India and another, AIR 1996 SC 531 . It is also permissible to grant compensation at the rate of per sq. ft. even in the case of large piece of land but after certain deduction for the development to be made as held in Karan Singh vs. Union of India (1998) 11 SCC 170 wherein the Apex Court has upheld grant of compensation of Rs. 10 per sq. ft. Offer of two different price for the land abutting the road and the land which was low lying area was upheld in G. Rameshan vs. State of Kerala, AIR 1997 SC 2159 . Distance from the city was also one of the relevant consideration, compensation of Re. 1/-sq. ft. was awarded and 50 paisa was deducted for development in hasanali Walimchand (dead) by LRs vs. State of Maharashtra AIR 1998 SC 700 . How much deduction has to be made for development of the land depends on factual matrix of each case. ( 8. ) IT is also pertinent to mention that time gap between the sale transaction and date of acquisition, genuineness of the transaction are relevant factors while determining the price, size of plot, small or large is also a relevant factor. Opening on the frontage on road, nearness to developed area, whether the area is low lying etc. are also relevant consideration as held in Chimanlal Hargovinddas vs. Special Land Acquisition Officer, Poona and another (supra ). In the instant case inadmissible piece of evidence was considered, that is, basic valuation register. Opening on the frontage on road, nearness to developed area, whether the area is low lying etc. are also relevant consideration as held in Chimanlal Hargovinddas vs. Special Land Acquisition Officer, Poona and another (supra ). In the instant case inadmissible piece of evidence was considered, that is, basic valuation register. The decision rendered by the Reference Court cannot be allowed to be sustained whereas sale deed which were before the date of notification under section 4 issued on 20th May, 1985, sale deeds of 1984 have also been discarded without going deep into the question whether sale deeds were not bona fide and they were with a view to fetch higher compensation in the case of acquisition of land, whether there were any steps taken by the respondents and how the claimants/villagers could have known that their land was going to be acquired in the year 1984 was relevant consideration, that has not been adverted to before discarding the sale deeds placed on record. It appears that the finding of LAO that Rs. 2. 40 was the price per sq. ft. has been commented upon on the one hand by the Reference Court that there was error of calculation made while determining the per hectare price but how much deduction for development was required to be made, even if the price was Rs. 2. 40 or any other amount such as rs. 2 as determined in other cases or the land was of capable of fetching much value or lesser value at the hands of prudent buyer, at the same time the Court has not taken into consideration the distinction between the small plots and large tract of land, large tract would not fetch the same valuation though it is permissible to award the compensation per sq. ft. , but after making certain deduction depending upon the development in the area in question, nothing of that sort has been done thus, we have no hesitation in setting aside the awards passed by Reference Court. At this stage, Shri Atulanand Awasthy, Shri A. K. Pathak and Ms. Malti Dadaria and Shri Sudhir Shrivastava, learned counsel appearing for the parties have jointly prayed that further opportunity be given to adduce evidence in the light of observations made in the order as the counsel have jointly consented for adducing further evidence. At this stage, Shri Atulanand Awasthy, Shri A. K. Pathak and Ms. Malti Dadaria and Shri Sudhir Shrivastava, learned counsel appearing for the parties have jointly prayed that further opportunity be given to adduce evidence in the light of observations made in the order as the counsel have jointly consented for adducing further evidence. The Reference Court shall record the evidence as may be adduced by the parties and render fresh decision in accordance with law in the light of observations made in this order. It is made clear that we have not commented upon the adequacy of compensation determined by the Court below in these cases, that has to be considered in the facts and circumstances of the case unfettered by any observation made in this order by this Court. ( 9. ) WE allow the appeals, set aside the awards and remit the cases to the reference Court. Reference Court to record the evidence as far as possible within four months from the date of first appearance of parties and render a decision within six months from the date of first appearance. Parties are directed to appear before the Reference Court on 21st January, 2008. It will not be necessary to issue fresh notice to the parties as date is given in presence of parties. As cases are being remanded, certificate of refund of Court Fees be issued to the appellants in terms of section 13 of Court Fees Act. We leave the parties to bear their own costs as incurred of the appeals. Appeals allowed.