HOW TO ISSUE VALUATION IN LAND ACQUISITION FOR COST OF CONSTRUCTION
KNOWLEDGE BANK FROM B KANAGA SABAPATHY
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Message from B. K. sir 15.03.2023
A property of my client was acquired by the government for road widening. It was a commercial building of 15 years old. He wanted to have more compensation from the government and he has requested me to issue a valuation report.
I worked out the value of land component by adopting the guideline rate. Now, to determine the depreciated value of the building, which method I can adopt? Is it straight-line method or constant percentage method. Which is advantageous to my client? Please guide.
1. For paying compensation, it is the prevailing practice to consider the re-instatement value of the building. This procedure is absolutely necessary for computing the fair compensation to the aggrieved parties.
2. Remarks by Mr. A. Anbazhagan, a valuer who has done many valuations for land acquisitions :
“This is the case of forced sale where the seller is forced / compelled to sell, considering the objective of the Act “The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act”.
It is FAIR to consider the REINSTATEMENT VALUE for this purpose.
The objective of the Act, 2013 is to provide transparent rehabilitation and resettlement processes and equitable compensation in the event of land acquisition.”
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With best wishes,
B. KANAGA SABAPATHY
About the Author:-
- Mr. B. Kanaga Sabapathy born in 1951, is a Civil Engineer who belongs to the 1972 batch of Regional Engineering College, Tiruchirappalli in Tamilnadu.
- He is a Registered valuer of the Central Board of Direct Taxes, a Professional Engineer and also a Chartered engineer. Valuation is his main profession..
- He was the National Vice-President of the Institution of Valuers (India) for 11 terms.
- He is a regular contributor of articles in the Indian Valuer Journal from the year 1985. His articles especially his regular column “Questions & Opinions” are very popular among the practising valuers in India.
- His book “Guidelines on Valuation for Banks” (2002) is used to be referred by many banks. The valuation formats designed by him were accepted and adopted as the formats by many banks in the country.
- His son K. Arun and daughter B.K. Aruna are also approved valuers and they also contribute articles to the Indian valuer journal.
- His guru: Mr. C.H. Gopinatha Rao, Chennai.
- His mentor: Mr. R.K. Gandhi, Mumbai.
- His role model: Mr. S. Rajaratnam, Chennai.
- His best students: Thousands of valuers in the country
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