STATE OF UTTARAKHAND AND ANR. versus RAVI KUMAR (DECEASED) THROUGH LRS AND OTHERS on 18 May 2023

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[2023] 10 S.C.R.

ASTATE OF UTTARAKHAND AND ANR.

v.

RAVI KUMAR (DECEASED) THROUGH LRS AND OTHERS

(Civil Appeal No. 4983 of 2009)

BMAY 18, 2023

[SURYA KANT AND J. K. MAHESHWARI, JJ.]

Tenancy laws: Title claim – On facts, land leased out to onein 1924 for thirty years under the 1895 Act, who sold it topredecessor-in-interest of the respondents vide sale deed of 1947Cand thereafter the land was recorded in his name and on his deathhis successor, and they are continuously recorded as Bhumidhar ofthe said land – Different set of legal proceedings which proceededin parallel – Issues pertaining to sale of ownership rights orleasehold rights to the respondents; status of the respondents underDthe applicable tenancy law and if the status entitled them forownership of the suit land; if the leasehold rights validly transferredunder the 1924 lease deed; determination of the 1924 lease deed,breach of the condition of prior approval and expiry of initial leasedeed period; and was it possible for predecessor of respondents tobe accorded the status of ‘Occupancy Tenant’ under the 1939 Act,Ewhich resulted in them being subsequently accorded the status of‘Sirdar’ under the Zamindari Notification – On appeal, held: HighCourt while deciding the issue of ownership in favour of therespondents on the strength of the Sale Deed, have come to differentconclusions as such to the nature of the instrument – Both theseFparallel findings by the High Court have been without any seriousexamination of the nature of the Sale Deed itself – Reasoned findingon both the nature of Sale Deed as well as whether the same wasviolative of conditions of the 1924 Lease Deed very important,because of which the issue of determination of lease remainsunanswered – High Court made sweeping remarks in respect of theGtenancy status without any serious consideration as to whether thesame were legally tenable or not – No reference is made to anyproceedings wherein the status as an occupancy tenant was evergranted to the predecessor of the respondent and, if so, how andwhen the same culminated into the status of ‘Sirdar’ under theHZamindari Notification – Thus, there are compelling circumstances which have been left unanswered by the courts below, because ofwhich determination of several factual issues have been left in limbo– In dearth of appropriate records, ownership rights in respect ofan immovable property cannot be decided casually – Thus, the Courtis reluctant to give a final opinion on the matter until the Court issatisfied on the basis of the entirety of documents – Matters remandedto the High Court for a fresh adjudication on the issues formulated,even though pending before this Court for more than 15 years –Government Grants Act of 1895 – U.P. Tenancy Act, 1939.

Partly allowing the appeals, the Court

HELD: 1.1 The High Court while deciding the issue ofownership in favour of Respondents on the strength of the SaleDeed, have come to different conclusions as such to the natureof the instrument. Respondents in the plaint filed by them in 1983Injunction Suit, the respondents claim to tenure holders who werelater accorded the status of ‘Bhumidhar’ on the basis of ZamindariNotification. On the other hand, in the Second Writ Petition, therespondents stated that the Sale Deed was actually in respect ofthe title per se. The recitals of the Sale Deed highlight that therelationship between JV and ML seemed more akin to that of avendor vendee in a title sale than that of the sale of leaseholdrights. [Paras 37 and 38][965-B-C; 966-E]

1.2 In respect of the two parallel findings given by the HighCourt, the respondents for the first time before this Court havegiven up the finding which treated the Sale Deed as a sale of title.However, it is noted that both these parallel findings by the HighCourt have been without any serious examination of the natureof the Sale Deed itself. The High Court erred in respect of thesefindings and as the same was essential to determine the presentdispute on merit, it is deemed to be a fit case to exercise thepower of remand. Additionally, despite these findings being aserious lacuna to reach a conclusive decision, the appellants haveraised no serious objection to the modified stand taken by therespondents wherein they stated that the Sale Deed was in respectof leasehold rights only. [Paras 39 and 40][966-F-H]

1.3 It can be safely deduced that the appellants did contendthe issue of prior approval from the initial stage itself. Apart from AB

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Athe said eviction suit, two other proceedings need to behighlighted, i.e. consolidation proceedings which occurredbetween 1959–1960 and acquisition proceedings for a portion ofland initiated by the military authorities in 1963. In respect of theconsolidation proceedings, the stand taken by State cannot bededuced as no document or order in respect of the same hasBbeen produced. However in respect of the acquisition, order dated22.11.1965 passed by the concerned Land Acquisition Officer,which granted compensation to the predecessor of respondentshas been brought on record wherein it must be noted thatcompensation was granted on the basis of revenue entries andCwithout any serious examination of the validity of the same.Hence, both these proceedings cannot be treated as an admissionof validity of revenue entries or as accepting the waiver of breachof the condition in respect of prior approval from the DeputyCommissioner. [Para 42][968-B-D]

D1.4 The order dated 07.08.1980 passed by theCommissioner, Kumaon, in the mutation proceedings makes itapparent that the approval from the appropriate authority as perthe lease deed, i.e. Deputy Commissioner was granted only on06.12.1948 which is more than a year later than the Sale Deed.On the contrary, as per the recitals contained in the Sale Deed, itEis mentioned that due permission was obtained and theconsequent mutation was effected in the office of Superintendent,Tarai and Bhabar, Nainital before its execution. Hence, this above-mentioned recital leads to immense confusion as to whether anyapproval was ever granted at the first instance. Even if suchFapproval was granted, no indication is given as such to actuallywho granted the approval and if it is assumed that a subordinateauthority granted the approval, no statutory instrument isproduced to highlight whether this delegation was possible ornot. The subordinate courts as well as the High Court have merely relied on the order dated 07.08.1980 passed by the Commissioner,GKumaon to come to a sweeping conclusion that a valid approvalexisted in favor of the predecessor of the respondents despiteglaring contradictions which were on the face of the record.Consequently, on this issue of breach of the conditions of the1924 Lease Deed, this Court fails to arrive at a decisive conclusionHas neither the original record nor its true copies have been placed on record of this Court or the High Court as well as the otherforums. Finally, while the respondents argued that until thereexisted an express refusal by the Deputy Commissioner for saleof leasehold rights, the sale was valid especially in light of postfacto approval granted by the Deputy Commissioner as has beenrecorded in order dated 07.08.1980 passed by theCommissioner. [Paras 43-45][968-H; 969-A-F]

1.5 It is settled law that any contractual term or conditionis to be interpreted as per the natural and ordinary meaningappended to the language used by the parties unless the sameleads to absurdity. In the present case, condition (e) of the 1924lease deed makes it clear that no rights in the Suit Land areallowed to be transferred or created “without the written approvalof the Deputy Commissioner of Nainital” which bears the crystalclear requirement of the prior assent needed from the DeputyCommissioner. This interpretation is also supported from thefact that leases under the Government Grants Act of 1985 are tobe strictly constructed as per the terms of the grant, regardlessof any other provisions of the law. Even otherwise, the High Courtand other authorities have proceeded on the premise of a validapproval. They are completely silent on whether the post factoapproval could be granted and if so, who granted such approval.Again, no records are produced and its not known whether anyapproval was ever actually granted and when or by whom. [Paras46 and 48][970-F-G; 971-A, E-F]

1.6 A reasoned finding on both the nature of Sale Deed aswell as whether the same was violative of conditions of the 1924Lease Deed goes to the heart of the present dispute, because ofwhich the issue of determination of lease remains unanswered.Hence, in light of the same, the respondents’ claim on the strengthof doctrine of holding over or through doctrine of acquiescenceas well as the reliance on the conduct of appellants, remains indoldrums as the same are hinged on the finding in respect ofdetermination of lease. It is also highlighted that decades havepassed in litigation, and it would be extremely iniquitous to remandthe case to revenue authorities at such a belated stage. [Para49][971-G; 972-A-B]

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A1.7 Even assuming that JV was deemed to have beengranted status as an ‘Occupancy Tenant’ under the 1939 Act, itshould be noted that his status as an ‘Occupancy Tenant’ cannotbe transferred to the predecessor of respondents in light ofSection 33 of the 1939 Act. The only exception to the bar ontransfer of status as an ‘Occupancy Tenant’ in the section 33 isBunder sub-clause (b) of clause (2) wherein reference is made toSection 251 which in turns deals with sale of occupancy rightswhen the tenant himself is facing the execution of a decree forarrears of rent. As no factual situation has been indicated statingthat JV had suffered a decree for rent arrears, there is no suretyCas to how any transfer of ‘Occupancy Tenant’ status in favour ofthe predecessor of respondents was sustainable. This confusionfurther indicates that the predecessor of respondents could nothave been accorded the status of ‘Sirdar’ under the ZamindariNotification on the strength of revenue entries which recordedhim as an ‘Occupancy Tenant’. [Para 52][973-B, G-H; 974-A-B]D

1.8 The High Court again made sweeping remarks inrespect of the tenancy status without any serious considerationas to whether the same were legally tenable or not. No referenceis made to any proceedings wherein the status as an occupancytenant was ever granted to the predecessor of the respondentEand, if so, how and when the same culminated into the status of‘Sirdar’ under the Zamindari Notification. These proceedingswhich ultimately led to the grant of status of ‘Bhumidhar’ in favourof the predecessor of respondents for the first time, could havepotentially served as the litmus test for the validity of theseFrevenue entries. [Para 53][974-B-D]

1.9 The High Court held that predecessor of respondentswas rightly accorded the status of ‘Sirdars’ under the ZamindariNotification on the ground that they were leaseholders governedby the Government Grants Act of 1895. However, this findingGagain appears unsustainable because there is no proper factualanalysis as to when the 1924 Lease Deed stood determined orwhether the same subsisted after the initial period of thirty years.[Para 54][974-D-E]

1.10 Initially the 1939 Act was not applicable to the SuitLand as the concerned area where it is situated was excludedfrom the purview of the 1939 Act, as it was specifically includedin the First Schedule. Any future application of the 1939 Act inrespect of the Suit Land was supposed to be through a separatenotification, but the same has again not been produced in theseproceedings or before any forum, which further dissuades fromrendering any final opinion at this stage. The same aspect hasbeen highlighted by the appellants who contend that the area inwhich the Suit Land is situated was governed by the KumaonTenancy Rules of 1918. On the other hand, the respondents haveproduced on record a G.O. No. 5678/ 1-B-1212~B-19 dated the30.04.1948 which indicates the possibility of hereditary rightsbeing accrued on predecessor of Respondents under the 1939Act but again, this Court constrained to give any finding on thesame because of the lack of proper documents on record toascertain the tenancy status of the Respondents. Hence, on thisground also the instant appeals are liable to be remanded backso that the relevant statutory notifications, original records canbe placed before the High Court to enable it to determine theapplicable tenancy law and their impact on the alleged rights ofthe respondents. [Paras 55 and 56][974-F-H; 975-B-D]

1.11 These appeals have been pending before this Courtfor more than 15 years. In normal circumstances, this Court wouldhave ventured to decide the issues but in light of theabovementioned observations and dearth of appropriate records,ownership rights in respect of an immovable property cannot bedecided casually. The hands are further tied because of the factthat the ownership of certain portions of the Suit Land hasapparently changed hands on account of subsequent sale by therespondents. Furthermore, the value of the Suit Land hasincreased exponentially during the entire period of litigation andthe relevant parties have also done certain valuabledevelopments. Any decision now cannot be based on conjecturesand surmises or on the basis of mere guesswork. Hence, theCourt is reluctant to give a final opinion on the matter until theCourt is satisfied on the basis of the entirety of documents which ABC

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Ashowcase how the ownership or possessory rights were createdon the Suit Land. [Paras 57 and 58][975-D-G]

1.12 There are indeed compelling circumstances whichhave been left unanswered by the courts below, because of whichdetermination of several factual issues have been left in limbo.BTherefore, in light of the peculiar situation, it is expedient toremand the appeals back to the High Court for fresh adjudicationon the issues formulated. In light of the long-drawn pendency ofthese disputes, the High Court is requested to take up thesematters at the earliest and dispose of the same as early aspossible. The impugned judgments of the High Court are setCaside, and the matters are remanded to the High Court for afresh adjudication. It is made clear that casual findings/observations made by Revenue Authorities or the Civil Courtshall not be accepted at their face value unless the High Court issatisfied on a thorough inspection of the original or certified copiesDof the relevant record. The parties are directed to keep statusquo until the matters are decided afresh by the High Court. [Paras59-61][975-H; 976-A-E]

U.P. Avas Evam Vikas Parishad v. Friends Coop.Housing Society Ltd. (1995) 3 Supp SCC 456 : [1995]E3 SCR 729; State of Punjab v. Gurdev Singh (1991) 4SCC 1 : [1991] 3 SCR 663; State of Kerala v. M.K.Kunhikannan Nambir Manjeri Manikoth Naduvil (1996)1 SCC 435 : [1995] 6 Suppl. SCR 139; Tayabbhai M.Bagasarwalla v. Hind Rubber Industries Pvt. Ltd. (1997)3 SCC 443 : [1997] 2 SCR 152; State of U.P. v. ZahoorFAhmad (1973) 2 SCC 547 : [1974] 1 SCR 344; M.O.H.Uduman v. M.O.H. Aslum (1991) 1 SCC 412 : [1990] 2Suppl. SCR 663; Life Insurance Corpn. of India v.Escorts Ltd. (1986) 1 SCC 264 : [1985] 3 Suppl. SCR909; Lord Krishna Textiles Mills Ltd. v. Workmen AIRG1961 SC 860 : [1961] SCR 204 – referred to.

Smith v. East Elloe Rural District Council [1956] 1 AllER 855; Investors Compensation Scheme Ltd vs. WestBromwich Building Society [1998] 1 All ER 98 –referred to.

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STATE OF UTTARAKHAND AND ANR. v. RAVI KUMAR(DECEASED) THROUGH LRS AND OTHERS

Shambhu Dayal Singh, The Law of Tenancy in U.P. (3rdedn, Empire Press, 1949) 131 – referred to.

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Case Law Reference

CIVIL APPELLATE/INHERENT JURISDICTION: Civil AppealNo. 4983 of 2009.

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From the Judgment and Order dated 05.08.2006 of the High Courtof Uttaranchal at Nainital in RA No.150 of 2005 in WP No. 920 of 2001,RA No. 151 of 2005 in WP No. 7176 of 2001 and RA No. 152 of 2005in WP No. 808 of 2002.

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Civil Appeal Nos. 4988, 4984, 4985 Of 2009, Contempt Petition(Civil) Nos. 165-168 of 2007 in Civil Appeal No. 4983 of 2009 and CivilAppeal Nos. 4989-4992 of 2009.

Harin P. Raval, Sr. Adv., Atul Sharma, Vikas Negi, A. VenayagamFBalan, Krishnam Mishra, Rajeev Kumar Dubey, Ashiwan Mishra,Kamlendra Mishra, Prashant Kumar, Aditya Dev Triguna, Saurabh S.Sinha, Satyajit A Desai, Satya Kam Sharma, Abhinav K. Mutyalwar,Siddharth Gautam, Gajanan N. Tirthkar, Ms. Anagha S. Desai, ManishKumar, Amit Kumar, Rahul Prabhakar, Ms. Aparajita Jha, Karan Singh,Mahesh Tiwari, Rakesh K. Sharma, P. N. Gupta, Advs. for the appearingGparties.

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AThe Judgment of the Court was delivered bySURYA KANT, J.

1. The core question that arises for our consideration in the presentset of connected matters pertains to the ownership of land measuring183 bigha 8 biswa which is equivalent to 28.56 acres of land, bearingBKhasra Nos. 2, 3/1, 3/2, 4 to 28/1, 28/2, to 49 and situated in VillageHaripur, Tehsil Haldwani, District Nainital (hereinafter, ‘Suit Land’).

2. Since these appeals arise out of a complex factual scenarioand different sets of legal proceedings which proceeded in parallel, itwould be appropriate to discuss the same at length before delving intoCthe issue of law, which require adjudication before us.

A. FACTSA.1 THE COMMON FACTS: 1924 SALE DEED, 1967EVICTION SUITAND 1978 MUTATIONPROCEEDINGSD

3. The genesis of these disputes began on 20.06.1924, when oneMr. John Vaughn, son of Mr. Charles Vaughn obtained a lease of theSuit Land (hereinafter, ‘1924 Lease Deed’) from the erstwhile colonialrulers through the Secretary of State for India in Council for thirty yearson payment of rent as agreed between the parties. The lease was alsoEextendable for another thirty years and was subject to certain conditions,which are reproduced as follows: - “X-X-X-X

(a) The lessee to pay the first period of thirty years theFyearly rental of No.183-6-4 clear of all deductions on thefirst day of March in each year at the Haldwani Tehsil or atsuch other place as the Deputy Commissioner of Nainitalshall form time to time appoint in this behalf and also fromtime to time and at all times during the continuance of thesaid lease pay and discharge all rates, taxes, charges andGassessment of every description which are now or may atany time hereafter during the said lease be assessed,charged or imposed upon the land hereby demised.

(b) Lessee agree that the said plot of land will be used forresidential purposes, for poultry farming for orchards andHfor vegetable cultivation only.

(c) The lessee agrees that he will submit the plan of anybuilding which he wish to erect or of any existing buildingwhich he has to modify to the Deputy Commissioner ofNainital for approval before starting building operations,that he will complete the sanctioned building within twoyears of the receipt of approval and that he will keep everybuilding erected by him and also the Government buildingsstanding on the said plot of land and shown on the planannexed in good and substantial repair and condition bothexternally and internally.

(d) The lessee agrees that he shall not claim the benefitswhich agricultural tenant and lessees are given in the Taraiand Bhaber estates.

(e) The lessee agrees that he will not transfer or subletsaid plot of land without the written approval of the DeputyCommissioner of Nainital.

(f) The lessee agrees that he shall be responsible for theobservance of Estate rules in force now or at any timehereafter regarding sanitation, reporting cattle disease etc.

(g) The lessee agrees that he shall have no right to anyminerals in the aid plot of land.

(h) The lessee further agrees that if he dies heirless beforethe expiry of lease as also on the expiry of lease, the landhereby demised and all buildings standing on the land shallrevert to the lesser without compensation.

(i) The lessee shall have the right to erect masonry wallnot exceeding 4.5 feet in height or a wire fence along theboundary of the said land hereby demised.

(j) The lessee shall have the use of a share of the waterwhen available for irrigation purposes from the tank fixedapproximately at mile 6 furlong 70 feet left of the maingailuwar canal, but the lessor reserve on control over thisoutlet which the lessor is empowered to decrease or closewhenever such decrease or closure is required on accountof short supplies in or on account of executing repairs,extensions or improvements canal works etc. and the lessee A

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Ashall have no right to claim compensation for any damagedone by such reduction or closer of the water supply to thesaid plot of land.

(k) The lessee shall have and unrestricted right to disposeof the produce of the land leased to him in any manner heBmay choose and the lessee shall be allowed to clear anduse for his requirements the trees and bushes standing onthe land hereby demised.

(l) If there be any breach by the lessee of any covenantherein before contained the Deputy Commissioner ofCNainital may, not withstanding the waiver of any previousbreach by the lessee giving the Deputy Commissioner of-Nainital the right of reentry, enter upon any part of whole of the land hereby demised or of the buildings standing onthe said plot of land and thereupon the said land and buildingsshall remain to the use of and be vested in the Secretary ofDState and the lessee shall not been titled to anycompensation for any building erected by him or for anyimprovements made by him upon the land demised and thisdemise shall absolutely determine.

(m) The Deputy Commissioner of Nainital agrees to stampEthe lease at his expense.

X-X-X-X”

4. After the execution of the 1924 Lease Deed which wasFregistered on 22.08.1925, it appears that revenue entries were made infavour of one Manohar Lal, who is said to have purchased the Suit Landthrough a sale deed dated 17.11.1947 (hereinafter, ‘Sale Deed’). Thesame Manohar Lal is also stated to be the paternal uncle of the primarycontesting respondents before us, namely Virendra Kumar and RaviKumar (hereinafter, ‘Respondents’), as the relief sought by all theGremaining private parties in connected matters flows from their claim onthe Suit Land. It would be appropriate at this stage to reproduce therelevant portion of the Sale Deed, which records the factum of priorpermission as required under the 1924 Lease Deed. The same is asfollows –H

“……whereas the vendor has full right to sell the aforesaidbuildings and constructions with the permission of theDeputy Commissioner, Nainital for which the vendor hasobtained the necessary permit from the proper authoritiesand mutation has been duly effected in the name of thevendee on 25.9.47 in the Government records in the officeof the Superintendent, Tarai & Bhabar, Nainital……”

5. Thereafter, it is to be noted that revenue records continued todepict the name of the predecessor of the Respondents as ‘OccupancyTenant’ on the strength of the said Sale Deed. Interestingly, at the expiryof thirty years in 1954, it is admitted that predecessor of Respondentsapplied for renewal and paid enhanced rent as per the 1924 Lease Deed.After that, consolidation proceedings took place between 1959-1960wherein revenue entries remained in favour of Manohar Lal and evencompensation was also awarded for a portion of Suit Land which wasacquired by the military authorities in 1963.

6. It was not until 1967 that the State filed a suit for possession ofthe Suit Land along with the damages before the concerned DistrictJudge. During the pendency of the said suit, UP Public Premises (Evictionof Unauthorised Occupants) Act, 1972 was promulgated and accordingly,the said suit stood transferred to the Prescribed Authority under the Act.In the interregnum before the final adjudication took place before thePrescribed Authority, it is pertinent to note that Bhumidhari certificateswere also issued to the predecessor of Respondents under the applicabletenancy law by depositing the amount which was equal to twenty timesthe land revenue for the Suit Land. Eventually, the Prescribed Authoritydismissed the suit on 25.03.1975 as being non-maintainable in view ofthe exclusion clause contained in the UP Public Premises (Eviction ofUnauthorised Occupants) Act, 1972 whereby the lands which were heldby any class of tenure-holder are exempted from the applicability of thesaid Act. The State’s appeal against the said order before the DistrictJudge was also dismissed on the grounds of being time-barred and thesuit being non-maintainable. The relevant extract of the District Judge’sorder dated 30.07.1976 is as follows –

“There are document on record to show that in 1366 Faslithe Respondent were recorded as Occupancy tenants.

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ASimilar entries exist on the Khatauni for the year up to 1375Fasli and in the Khatauni for 1376 Fasli the Respondentsare recorded Sirdar. The learned Counsel for therespondents has referred me to section 2(b) which definesthe expression “Premises”. There are certain exceptionmentioned and sub section (ii) is in respect of land by aBtenure holder under the U.P. Tenancy Act. The land indispute has to be excluded from the expression “Premises”and the prescribed authority was justified in holding so.The appeal must, therefore be dismissed.”

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7. Hence, the suit which was instated in 1967 was neveradjudicated on merits per se in respect of the claim of tenancy by theRespondents, but on the technical grounds of the bar contained in theUP Public Premises (Eviction of Unauthorised Occupants) Act, 1972 aswell as on the ground that the appeal against the Prescribed Authority’sDorder was time barred. However, the District Judge’s order dated30.07.1976 remained unchallenged and ultimately, after the demise ofManohar Lal, who died issueless, mutation proceedings were initiated in1978 by the present Respondents on the basis of a family settlement.

8. While the relevant orders in the said mutation proceedings haveEnot been made part of the records produced before us, it is stated thatthe Tehsildar, Haldwani passed an order dated 04.07.1978 in favour ofthe Respondents. This order was later confirmed by another order dated30.08.1978 passed by the concerned SDM directing the Tehsildar,Haldwani to mutate the Suit Land in favour of Respondents in revenueFrecords. Against the order of the SDM, the State preferred an appealbefore the Commissioner, Kumaon which was rejected vide order dated07.08.1980 and even the revision application against the same wasdismissed on 31.12.1980. It is pertinent to note that during the proceedings,a vernacular copy of the order dated 07.08.1980 was produced beforeus, which we will refer to at a later stage.G

9. In the end, because of the fact that the Respondents weresuccessful in the mutation proceedings, the Pargana Officer, Haldwanipassed an order dated 30.09.1981 accepting the partition between theconcerned Respondents, i.e. between Virendra Kumar and Ravi Kumar,on the basis of family settlement. Meanwhile, orders dated 07.08.1980Hand 31.12.1980 were challenged before the Board of Revenue in revision proceedings, but the same were dismissed via order dated 20.01.1982with the following observation –

“In fact, the challenge which is raised on behalf of thegovernment, is in respect of ownership of the land and thismatter cannot be decided finally in the mutation proceeding.Therefore, the matter should be proceeded in othercompetent court.”

Thus, the issue of ownership again remained unadjudicated evenat this stage.

10. For the ease of analysis, the key events in these proceedingsare summarised as follows –

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AA.2 THE CANCELLATION OF REVENUE ENTRIES ANDRESTRAINT ON SALE OF LAND: CIVILAPPEAL NO 4983OF 2009 AND CIVILAPPEAL NO 4985 OF 2009

11. The subject matter of these appeals arose from an order dated31.12.1981 passed by the District Collector, Nainital (hereinafter,B‘Expunction Order’) during the pendency of the revision proceedingsbefore the Board of Revenue in the abovementioned mutationproceedings. In the said order, the Collector noted that on perusal of therevenue records, it was found that after the initial lease period of thirtyyears had expired, the Respondents had illegally gotten themselvesrecorded as ‘Bhumidhar’ of the Suit Land in the revenue records.CAccordingly, the Collector directed the expunction of the revenue entriesin favour of the Respondents and recommended that eviction proceedingsbe initiated against them.

12. Against the Expunction Order, the Respondents preferred arevision before the Commissioner, Kumaon who passed an interim orderDdated 20.01.1982 directing that no revenue entries should be deleted inlight of the fact that the matter was pending before the Board of Revenuein mutation proceedings. However, as noted above, the Board of Revenuedismissed the said pending revision in the mutation proceedings on thesame date. Consequently, it is stated that despite the abovementionedEinterim order dated 20.01.1982 of the Commissioner, the Tehsildar actedon Expunction Order and proceeded to expunge the revenue entries infavour of Respondents.

13. Afterwards, on 16.08.1983, the Commissioner, Kumaondismissed the revision pending against the Expunction Order noting thatFthe same was not maintainable in view of the fact that no provisionprovided for revision of an order passed under the Government GrantsAct of 1895 as applicable to the then State of Uttar Pradesh videamendment made in 1960. The relevant provisions after the 1960amendment to the Government Grants Act of 1895 are as follows –

G“2. (1) Transfer of Property Act, 1882, not to apply togovernment grants.-Nothing contained in the Transfer ofProperty Act, 1882, shall apply or be deemed ever to haveapplied to any grant or other transfer of land or of anyinterest therein, heretofore made or hereafter to be made,by or on behalf of the Government to or in favour of anyHperson whomsoever; and every such grant and transfer shall be construed and take effect as if the said Act had not beenpassed.

(2) U.P. Tenancy Act, 1939 and Agra Tenancy Act, 1926 notto affect certain leases made by or on behalf of theGovernment.-Nothing contained in the U.P. Tenancy Act,1939, or the Agra Tenancy Act, 1926, shall affect, or bedeemed to have ever affected any rights, created, conferredor granted, whether before or after the date of the passingof the, Government Grants (U.P. Amendment) Act, 1960,by leases of land by, or on behalf of, the Government infavour of any person; and every such creation, confermentor grant shall be construed and take effect notwithstandinganything to the contrary contained in the U.P. Tenancy Act,1939, or the Agra Tenancy Act, 1926.

(3) Certain leases made by or on behalf of the Government totake effect according to their tenor.-All provisions,restrictions, conditions and limitations contained in any suchcreation, conferment or grant referred to in Section 2, shallbe valid and take effect according to their tenor; any decreeor direction of a court of law or any rule of law, statute orenactment of the legislature, to the contrarynotwithstanding:

Provided that nothing in this section shall prevent, or bedeemed ever to have prevented, the effect of any enactmentrelating to the acquisition of property, land reforms or theimposition of ceiling on agricultural lands.”

It must also be highlighted that the Respondents, against theaforesaid action of the Tehsildar wherein he expunged the revenue entriesin favor of Respondents, preferred a contempt petition before theAllahabad High Court, which was dismissed in limine on 16.08.1986after the concerned officials tendered unqualified apologies.

14. Aggrieved by the said order dated 16.08.1983 of theCommissioner, the Respondents filed a revision before the Board ofRevenue, which was heard by a Single Member who vide its order dated22.01.1993 (hereinafter, ‘Single Member’s Order’) set aside theExpunction Order. The Single Member’s Order noted that the ExpunctionOrder was not passed under the Government Grants Act of 1895 but AB

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Aunder the applicable land revenue laws, making it susceptible to revisionaryjurisdiction. It furthermore noted that no enquiry report was ever obtainednor was any opportunity given to Respondents for being heard whilepassing the Expunction Order.

15. Against the Single Member’s Order, the District MagistrateBof Nainital wrote a letter to the Board of Revenue seeking permission tochallenge the same through a writ petition and during the interregnum,the State filed a writ petition in 1996 against the Single Member’s Order(hereinafter, ‘First Writ Petition’). Meanwhile, the Board of Revenueacted on the abovementioned letter addressed by the District Magistrateof Nainital and constituted a Three Member Bench to scrutinise theCSingle Member’s Order.

16. The Three Member Bench in turn vide its order dated20.12.1996 (hereinafter, ‘Three Member Bench’s Order’) held thatSingle Member’s Order was without any jurisdiction as no power forrevision existed under the land revenue laws and also noted that theDExpunction Order was passed under the Government Grants Act of1895. It furthermore noted that the Collector had rightly issued theExpunction Order as the Respondents illegally obtained revenue entriesin their favour in collusion with revenue officials after the expiry of theinitial lease period of thirty years. Hence, it observed that the Suit LandEstood automatically resumed in favour of the State after the expiry ofthe lease period, and no notice was required to be given to theRespondents at the time of passing the Expunction Order. Against thisThree Member Bench’s Order, Respondents filed a writ petition in 1997(hereinafter, ‘Second Writ Petition’).

F17. Afterwards, a review petition was filed before the SingleMember of the Board of Revenue in view of the observations in theThree Member Bench’s Order. Accordingly, the Single Member on03.03.1997 directed that the review petition be placed before the samebench that rendered the Three Member Bench’s Order. In turn, the saidbench on 18.12.1997 is said to have passed an order stating that ThreeGMember Bench’s Order did not alter the Single Member’s Order anddirected that the review should be filed before the Single Member only.Though, it is stated by the Respondents that no such review proceedingstook place as none of the parties pursued it any further and instead thematter was kept pending in the writ proceedings as noted above. However,Hit has come on record that a review was indeed filed by the Appellants, which was directed to be heard urgently and later on was transferred tothe revenue court of Additional Chief Revenue Commissioner, Nainitalafter the formation of State of Uttarakhand.

18. During the pendency of the aforesaid writ proceedings aswell as the review before the revenue court, the District Magistratepassed orders dated 02.05.2001 and 21.05.2001 (hereinafter, ‘RestrainOrders’) directing the Special Land Acquisition Officer and theconcerned Tehsildar to restraint the Respondents from selling, transferringor mutating the Suit Land or any part thereof. Aggrieved by the saidorders, the Respondents filed an injunction suit, but the same wasdismissed on 06.06.2002 on account of being non-maintainable. Upondismissal of the suit, the Respondents instead filed a revision petitionbefore the Additional Chief Revenue Commissioner, who vide his orderdated 22.07.2002, declared Restrain Orders as void and illegal. It alsonoted that the Single Member’s Order had attained finality, the Staterecognised ownership of the Respondents as they granted themcompensation for the land acquired by military authorities in 1963 andthat the revenue entries were longstanding in favour of the Respondents.It must be noted that the Appellants filed a writ petition against the orderdated 22.07.2002 before the High Court (hereinafter, ‘Third WritPetition’).

19. Ultimately all three writ petitions were heard together by theHigh Court, which vide the impugned judgement dated 07.10.2005 inCivil Appeal No 4985 of 2009 decided the matter in favour ofRespondents. The High Court noted that, firstly the predecessor of theRespondents validly got the approval of the Commissioner as requiredunder the 1924 Lease Deed, which was reflected in the order dated07.08.1980 passed by the Commissioner in the mutation proceedings.Secondly, the revenue entries have long been standing in favour of theRespondents since 1948 which reflects that they have been accordedthe status of ‘Bhumidhar’. Furthermore, it noted that these entries becamefinal since the Appellants never initiated any proceedings for theircorrection, and these entries could not be deleted through an administrativeorder as done by the Expunction Order. Consequently, the Respondents’writ, i.e. Second Writ Petition, was allowed while the remaining writpetitions filed by the Appellants were dismissed.

20. Interestingly after the High Court passed the impugnedjudgement dated 07.10.2005, the pending review before the revenue AB

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Acourt of Additional Chief Revenue Commissioner, Nainital was decidedin favour of the Appellants vide an order dated 21.10.2005 wherein theauthority set aside the Single Member’s Order and directed that in viewof the Three Member Bench’s Order, the Expunction Order must becomplied with.

B21. Consequently, the Appellants preferred review applicationsagainst the judgement dated 07.10.2005, which the High Court dismissedvide the impugned judgement dated 05.08.2006 in Civil Appeal No 4983of 2009 wherein it was noted that no ground for review was made outby the Appellants and the observations of the order dated 07.10.2005were reiterated. It also specifically noted that Expunction Order stoodCset aside in view of the Single Member’s Order and that order dated21.10.2005 was passed without any jurisdiction by the Additional ChiefRevenue Commissioner as the High Court already decided the mattervide judgment dated 07.10.2005. We must also hasten to add that duringthe hearing of the abovementioned review applications, the AdditionalDChief Revenue Commissioner tendered an apology via an affidavit statingthat he had no knowledge that the High Court had already decided thepending writ petitions through its judgment dated 07.10.2005.

22. Again for ease of analysis, the key events in these proceedingsare summarised as follows –

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A.3 THE RESPONDENTS’ 1983 INJUNCTION SUITPROCEEDINGS: CIVILAPPEAL NO 4988 OF 2009AND CIVILAPPEAL NO 4984 OF 2009

23. The cause for the inception of these appeals arose when theCommissioner dismissed the revision against the Expunction Order asnon-maintainable. Because of the said dismissal, the Respondentsapprehended that the revenue entries in their favour would be struckoff, and accordingly, they filed a suit praying for perpetual injunctionrestraining the Appellants from evicting the Respondents from the SuitLand as well as a mandatory injunction directing the Appellants to refrainfrom deleting or restoring the revenue entries in their favour.

24. The Trial Court decreed the said suit in favour of theRespondents vide its order dated 20.10.1984. The Trial Court madeextensive reference to 1967 Eviction Suit proceedings and 1978 MutationProceedings to hold that Respondents became ‘Sirdar’ and later on‘Bhumidhar’ legally and that Appellants have no claim of title over theSuit Land. The Appellants filed an appeal against the order dated20.10.1984, which was dismissed by the First Appellate Court on16.06.1986 on identical reasoning as given by the Trial Court. The FirstAppellate Court again highlighted the factum of longstanding revenueentries in favour of Respondents and the continued possession with themto uphold the order of the Trial Court. It also observed that the dispute inrespect of the revenue entries should have been adjudicated by thecompetent revenue court instead of being decided by the Collector videthe Expunction Order.

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A25. The Appellants proceeded to file the second appeal beforethe High Court against the First Appellate Court’s order, and the samewas dismissed vide the impugned judgment dated 05.11.2004 passed inCivil Appeal No 4988 of 2009. While dismissing the second appeal, theHigh Court noted that the suit was filed within limitation and that thecourts below have rightly held that Respondents have lawfully acquiredBthe status of ‘Sirdar’ and later on that of ‘Bhumidhar’. Against the saidjudgment dated 05.11.2004, the Appellants preferred a review petition,but the same was dismissed vide the impugned judgement dated28.07.2005 in Civil Appeal No 4984 of 2009 on identical reasoning.

26. We again proceed to summarise the litigation history in a tabularCformat as follows –

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A.4 THE 1982 LAND ACQUISITION PROCEEDINGS:CIVILAPPEAL(S) NO. 4989-4992 OF 2009F

27. The commencement point for these appeals began when thestate authorities issued a notification dated 13.04.1982 under Section 4of the Land Acquisition Act of 1894 for acquiring land measuring 70bigha 08 biswa for the construction of Model Industrial Training Institute.Out of the entire proposed acquisition, land measuring 11 bigha 06 biswaGwas part of the Suit Land. Subsequently, a notification dated 16.09.1982under Section 6 of the Land Acquisition Act of 1894 was issued, possessionwas taken on 23.07.1983 and an award was also passed on 30.09.1985,but the Respondents were denied compensation on the ground that landbelonged to the government. Aggrieved by the denial of compensation,the Respondents filed a reference which was decided in their favour onH

21.02.2006 on the strength of impugned judgements in theabovementioned connected civil appeals which determined Respondentsas lawful owners of the Suit Land.

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28. The Appellants filed respective appeals before the High Courtagainst the Reference Court’s order, and the same was dismissed videthe impugned judgement dated 24.07.2008 in Civil Appeal(s) No 498-4992 of 2009 wherein the High Court again held in favour of theRespondents on identical grounds and granted compensation at the rateof Rs. 8 per square feet along with solatium and applicable statutorybenefits.

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29. To summarise these proceedings –

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A.5 CONTEMPT PETITION (CIVIL) NO 165-168 OF2007 IN CIVILAPPEAL NO 4983 OF 2009

30. Respondents have initiated these contempt proceedings forviolation of order dated 23.02.2007 passed by this Court directing partiesGto maintain the status quo. The Respondents contend that the Appellantshave been interfering with their peaceful possession, especially in concernwith the commercial activities conducted on the Suit Land. However,since we are disposing off the appeals finally, there is no need to dealwith these contempt petitions.

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AB. CONTENTIONS

31. We have heard learned counsel for the parties and perusedthe documents produced on record. We would like to point out that duringthe course of arguments which went on for a couple of days, the benchas well as the counsel for the parties, readily agreed that the core issueBfor adjudication was in respect of the status of the Respondents underthe applicable tenancy law and whether the same entitled them forownership of the Suit Land. It is in this context that we propose to considerthe arguments raised by the parties.

32. Mr. Atul Sharma, learned counsel for the Appellants made theCfollowing contentions –

a) It was submitted that the Suit Land was given on lease to Mr.John Vaughn for the limited period of thirty years under the GovernmentGrant Act of 1895 and as per the conditions stipulated in the 1924 LeaseDeed, it was necessary to obtain a prior written approval or approval ofDthe Deputy Commissioner, Nainital before the lease rights could betransferred in favour of the Respondents. Therefore, since no suchapproval was ever given nor produced before the courts during theproceedings below by the Respondents, it must be construed that thepredecessor of Respondents, i.e. Manohar Lal was an illegal occupantwhen he was put into possession of the Suit Land on the basis of theESale Deed. He vehemently argued that the Sale Deed was null and voidas the vendor himself had no ownership title which he could lawfullyalienate;

b) It was argued that even otherwise the Respondents’ statusremained that of illegal occupants as the initial lease period ended inF1954 and since no renewal was granted by the State. Hence, it wassubmitted that the Suit Land stood automatically resumed in favour ofthe State after the expiry of the lease period;

c) The 1924 Lease Deed explicitly stated that there would be noapplication of tenancy law benefits as applicable to the lessees of theGSuit Land. Furthermore, it was submitted that after the 1960 Stateamendment to the Government Grant Act of 1895, the applicability ofthe tenancy laws as well as Transfer of Property Act was retrospectivelybarred. Hence in effect, no tenancy rights were ever created in favourof Respondents, nor could they claim lawful tenancy by evoking thedoctrine of holding over;H

d) It was also argued that 1967 Eviction Suit and 1978 MutationProceedings never decided the issue of ownership or tenancy status.Therefore, these proceedings cannot be treated to have decided theprincipal issues on merits.

e) It was also argued that mere longstanding entries in favour ofRespondents would not be sufficient to establish the claim of ownershipand that the same were made fraudulently in connivance with revenueauthorities. In other words, mutation entries in no way confer the title.

f)Finally, the Courts or quasi-judicial authorities have merelyfollowed each other without going into the root question as to how theRespondents claimed to have become the owner or ‘Bhumidhar’ overthe Suit Land.

33. On the contrary, Mr. Harin P. Ravel, learned senior counselfor the Respondents initiated his arguments on the first day of hearingby submitting that the Respondents claimed ownership on twoindependent grounds, firstly through the Sale Deed and secondly, onthe strength of status accorded under the applicable tenancy laws.However, on the final day of arguments, Mr. Ravel clarified theabovementioned stand by stating that the Sale Deed pertained to sale ofleasehold rights and not the sale of title or ownership rights. Thereforeat present, the claim of the Respondents is actually based on the strengthof status accorded under the applicable tenancy laws as we will notewhile reiterating Mr. Ravel’s arguments which are as follows -

a) It has been submitted that there was no mandatory requirementof prior approval from the Deputy Commissioner at time of the executionof the Sale Deed. The Respondents have relied upon the decision inU.P. Avas Evam Vikas Parishad v Friends Coop. Housing SocietyLtd.[1]to contend that there is a distinction between the term ‘approval’and ‘permission’ wherein when the former term is used, all actions holdgood until they are explicitly disapproved. In other words, they contendthat the Sale Deed must be treated as valid until there is an explicitrefusal to grant consent for transfer of rights by the DeputyCommissioner.

b) It was also argued that even otherwise, permission or approvalas required from the Deputy Commissioner was granted on 16.12.1948

1 U.P. Avas Evam Vikas Parishad v. Friends Coop. Housing Society Ltd 1995 Supp (3)SCC 456.

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Aas recorded in order dated 07.08.1980 passed by the Commissioner inthe mutation proceedings. Therefore as the approval was validly granted,albeit after the Sale Deed was executed, the predecessor of theRespondents was rightly accorded the status of ‘occupancy tenant’ underthe United Provinces Tenancy Act of 1939 (hereinafter, ‘1939 Act’),which superseded the conditions in the 1924 Lease Deed as well asBprovisions of the Government Grant Act of 1895. Furthermore, it wassubmitted that after notification dated 30.06.1969 was issued by the State,which extended the provisions of U.P. Zamindari Abolition and LandReforms Act, 1950 to the Suit Land (hereinafter, ‘ZamindariNotification’), the predecessor of Respondents became ‘Sirdar’ as perCSection 131 as applicable vide Zamindari Notification. The relevantportion of the said notification is as follows –

“X-X-X-X

130- Every person belonging to any of the followingclasses shall be called a bhumidhar and shall have allDthe rights and be subject to all the liabilities conferredor imposed upon bhumidhars by or under this Act, namely –

(a) every person who on the date immediately precedingthe appointed day held land as- E

F(b) every person who acquires the rights of a bhumidharunder or in accordance with the provisions of this Act.”

x-x-x-x

131. Sirdar. - Every person belonging to any of theGfollowing classes shall be called a sirdars and shall haveall the rights and be subject to all the liabilities conferredor imposed upon sirdars by or under this Act, namely –

(a) every person who, on the date immediately precedingthe appointed day held kind as- H

(iii) a grantee at favourable rate of rent

(iv) a lessee holding a lease under the provisions of theGovernment Grants Act, 1895 and having rights ofhereditary tenant under the terms of the lease, but notpossessing the rights to transfer the holding by sale, (b) every person who is admitted as sirdar of vacant landunder the provisions of this Act,

(c) a tenant in any of the 42 Buxari villages specified inthe Annexure, appended hereto, who was recorded inClass X(l) in the Khatauni of the previous agriculturalyear, and (d) every person who, in any other manner, acquires therights of a sirdar under or in accordance with theprovisions of this Act.

X-X-X-X”

c) Extending the abovementioned argument, it is submitted thatpredecessor of Respondents made application for becoming a‘Bhumidhar’ under the applicable rules which is stated to beallowed. It is also stated that they paid twenty times the revenuefor the Suit Land and accordingly were granted a ‘Bhumidhari’certificate under Section 137 of the U.P. Zamindari Abolition andLand Reforms Act, 1950. Therefore to sum up, it was submittedthat the entire chronological sequence as narrated above bearstestimony to the logical progression of rights of the predecessorof the Respondents culminating into title as ‘Bhumidhar’ as perthe object of the U.P. Zamindari Abolition and Land ReformsAct, 1950. This argument is further supplemented by stating thatthe Appellants have failed to produce anything on record to supportthe plea that the concerned revenue entries during this periodhave been made fraudulently or through suppression of any fact.

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d) It was also submitted that Appellants have deliberately failedto take any steps to correct the abovementioned revenue entries,which carry the presumption to be correct in law, despitesuggestions to the contrary by the adjudication authorities inmultiple proceedings, including in the 1978 Mutation Proceedings.Therefore in effect, it is stated by Respondents by relying onmultiple decisions[2] that favourable orders passed in the erstwhileproceedings between parties have become final, especially in lightof the fact that the Appellants never took steps to get them setaside by competent authorities.

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e) It was argued that the Respondents have acquired rights overthe Suit Land by way of acquiescence and the conduct of theAppellants wherein it is alleged that in addition to failure to initiateproper proceedings to evict them, the Appellants accepted theenhanced rent, raised revenue demands and allowed themapprovals for further development of the Suit Land.

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f)Finally, it has been argued that the lease did not end after theexpiry of the initial thirty year period in June 1954 and instead thelease got extended on an yearly basis on account of application ofSection 116 of the Transfer of Property Act of 1882, through whichtenancy has been lawfully continued by holding over on accountEof continuous possession by Respondents. Reliance was placedon the decision rendered in State of Uttar Pradesh v ZahoorAhmad[3]to argue that Section 116 of the Transfer of PropertyAct of 1882 would be applicable notwithstanding the 1960 Stateamendment to the Government Grant Act of 1895 and the factthat predecessor of Respondents deposited enhanced rent as perFthe 1924 Lease Deed which was never rejected by the Appellants.

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C. ANALYSIS

34. Before we analyse the rival contentions raised by the parties,it would be appropriate to broadly highlight the issues which arise for ourconsideration –G

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2 Smith v East Elloe Rural District Council [1956] 1 All ER 855; State of Punjab vGurdev Singh (1991) 4 SCC 1, para 8-9; State of Kerala v M.K. Kunhikannan NambirManjeri Manikoth Naduvil (1996) 1 SCC 435, para 7-8; Tayabbhai M. Bagasarwalla v.Hind Rubber Industries Pvt. Ltd. (1997) 3 SCC 443, para 17-18.3 State of U.P. v. Zahoor Ahmad (1973) 2 SCC 547.

i. Did the Respondents’ predecessor-in-interest purchaseownership rights or leasehold rights from Mr. John Vaughan?

ii. In case of the latter, the next question that arises is whether theleasehold rights stood legally transferred to the predecessor ofRespondents as per the conditions of the 1924 Lease deed, whichwas governed under the Government Grants Act of 1885?

iii. If the leasehold rights cannot be held to be validly transferredunder the 1924 Lease Deed, whether the same stood determinedat the time of execution of Sale Deed because of violation of thestipulated conditions?

iv. If the abovementioned question is answered negatively, didthe 1924 Lease Deed stand determined at the expiration of theinitial lease period of thirty years?

v. If the 1924 Lease Deed stood determined after the initial leaseperiod of thirty years, whether the Respondents are entitled toseek protection of holding over of the lease under Section 116 ofthe Transfer of Property Act of 1882?

vi. Alternatively, could the lease ever deemed to have beensubsisted because of the doctrine of acquiescence and throughthe conduct of Respondents? Furthermore, if the same couldaccord them any benefit under the Zamindari Notification?

vii. Regardless of the fact that the lease deed is deemed to havesubsisted, was it possible for predecessor of Respondents to beaccorded the status of ‘Occupancy Tenant’ under the 1939 Act,which resulted in them being subsequently accorded the status of‘Sirdar’ under the Zamindari Notification?

viii. Furthermore, could the predecessor of Respondents havebeen accorded the status of ‘Sirdar’ through any other alternatemethod as indicated under the Zamindari Notification? In otherwords, did the Respondents’ predecessor obtain status as ‘Sirdar’on account of being recorded as a ‘hereditary tenant’ or a‘government lessee’ as per Section 131 of the ZamindariNotification?

C.1 SALE OF OWNERSHIP RIGHTS OR LEASEHOLDRIGHTS

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A35. At the outset, it is iterated that during the oral arguments, theRespondents have taken the stand that the Sale Deed actually pertainedto sale of leasehold rights and not of title per se. However, it is pertinentto mention that their stand has been inconsistent regarding this issue inthe courts below and even the High Court vide its impugned decisionshave given parallel findings regarding the nature of the Sale Deed.

B36. In the impugned judgement 07.05.2005, which arose from theExpunction Order Proceedings, the High Court noted –

“The respondents are the recorded Bhumidhar of the landin question which is evident from the khatauni of 1401 F-C1406 F. The land was leased out to Mr. John Vaughan on20.6.1924 who sold the land to Sri Manohar Lal vide saledeed dated 117 .11.194 7 and thereafter the land wasrecorded in the name of Sri Manohar Lal and on his deathhis successor Sri Ravi Kumar and Virendra Kumar. Theyare continuously recorded as Bhumidhar of the land inDquestion. The Chief Revenue Commissioner also held inhis judgment that from the order dated 20.9.1999 ofAdditional District Magistrate (Land Acquisition) Lucknowand from the G.O.No. 376 dated 16.5.2002 issued by theSecretary, Uttaranchal Government all land acquisitionEproceedings in respect of the land in question have cometo an end and the Government has ordered that the land bekept in the ownership and possession of the Bhumidharsi.e . Sri Ravi Kumar and Virendra Kumar.”

FOn the contrary, in the impugned judgement 05.11.2004 whicharose from the 1983 Injunction Suit, the High Court noted –

“In view of the amended section 131 of U.P.Z.A. & LR.Act, a lease holder would become a Sirdar on the date ofenforcement of the Act viz. 1. 7.1969. The plaintiffs’Gpredecessor Sri Manohar Lal got transferred the leaseexisting in the name of Mr. John Vaughan with thepermission of the Commissioner Kumaon and he was inpossession in July 1969 on the land in suit.Thus from theevidence on record it is established that the plaintiffs arethe Bhumidhar, and are in possession over the land in H

dispute and there is no material error in the finding arrivedat by both the courts below.”

(Emphasis Applied)

37. Therefore, the High Court while deciding the issue of ownershipin favour of Respondents on the strength of the Sale Deed, have cometo different conclusions as such to the nature of the instrument. In thisrespect, our attention is also drawn towards the contrary stands takenby the Respondents in their pleadings which have been brought on record.In the plaint filed by them in 1983 Injunction Suit, the Respondents claimto tenure holders who were later accorded the status of ‘Bhumidhar’ onthe basis of Zamindari Notification. On the other hand, in the SecondWrit Petition, Respondents stated that the Sale Deed was actually inrespect of the title per se.

38. Nevertheless, even if the clarification on behalf of Respondentswhich is taken for the first time at this stage is allowed, we must notethat the tenor of the Sale Deed completely contradicts the said modifiedstance. The relevant portion of the Sale Deed is as follows –

“…….NOW THIS DEED WITNESSETH That inconsideration of the sum of Rupees Fifty Five ThousandRs.55000/- paid by the vendee to the vendor in the mannerfollowing i.e., Rs.5000/- five thousand acknowledged andRs.20000/- Twenty Thousand paid in cash before the Sub.Registrar. Rs.20000 by cheque 16124 on Imperial BankNainital dated the 17[th] November 1947 Rs.5000/- fivethousand by cheque No. 16125 on the same Bank datedthe 10[th] December 1947 which cheques have been handedover to the vendor before the Sub Registrar to day and thebalance of Rs.5000/- five thousand to be paid by the vendeewhen the garages are vacated by the present tenants whomthe vendor undertakes to vacate by the end of this monthset forth above is acknowledged in full, the vendor forhimself, his executors, administrators and assigns dothhereby sell, transfer, convey and assign unto the vendeethe aforesaid plot of land in its entirety containing byadmeasurements 28.165 acres of land more fully describedat the foot of THESE PRESENTS with all residential andother buildings therein standing and the boundary wall, tank, A

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Agarages and out houses together with all trees, plants,shrubs, crops and all agricultural implements and cattle asper list handed over to the vendee and all surface rights,lights, water & other rights easements to have to hold andto enjoy peaceably and for ever without any let or hindrancefrom the vendor or any one claiming through him orBindependently. It is certified by These Presents that thepossession of the premises has already been made over tothe vendee whose name has already been mutated in theGovernment records in place of the vendor aforesaid. It isfurther certified that the land and premises hereby sold areCabsolutely free from all liens and charges save and exceptthe yearly Government lease rent of Rs.183/6/4. TheVendor covenants with the vendee to compensate and savefrom harm the vendee his heirs, executors and assignsagainst any loss or damage that he might suffer due to anydefect in the title of the vendor to sell the premises herebyDtransferred or to any part thereof…….”

These recitals of the Sale Deed highlight that the relationshipbetween Mr. John Vaughn and Mr. Manohar Lal seemed more akin toEthat of a vendor-vendee in a title sale than that of the sale of leaseholdrights.

39. We must again take note that in respect of the two parallelfindings given by the High Court, the Respondents for the first timebefore this Court have given up the finding which treated the Sale DeedFas a sale of title. However, we must note that both these parallel findingsby the High Court have been without any serious examination of thenature of the Sale Deed itself. In our opinion, High Court erred in respectof these findings and as the same was essential to determine the presentdispute on merit, we deem it a fit case to exercise our power of remand.

G40. Additionally, despite these findings being a serious lacuna forus to reach a conclusive decision, the Appellants have raised no seriousobjection to the modified stand taken by the Respondents wherein theystated that the Sale Deed was in respect of leasehold rights only. However,we would like to highlight several other aspects of the present disputeswhich further warrant the exercise of the power of remand.H

C.2 DETERMINATION OFTHE 1924 LEASE DEED:THE BREACH OF THE CONDITION OF PRIORAPPROVALAND EXPIRY OF INITIAL LEASE DEEDPERIOD

41. During the course of hearing, the bench raised a query inrespect of the earliest stand taken by the Appellants on the aspect ofbreach of clause (e) of the 1924 Lease Deed in respect of prior approval.In response to the same, our attention was towards the plaint filed by theState in the 1967 Eviction Suit, the relevant part thereof is as follows –

“X-X-X-X

3. That on or about 21-8-1947 the lease, Mr. John VaughanTransferred the property in suit to the defendant no.1 andput him in possession of the same without the writtenapproval of the Deputy Commissioner, Nainital, anapplication was no doubt made to and approved by the thensuperintendent of Tarai and Bhabar Govt. Estates, but theorders of the Superintendent T.& B. Govt. Estates,sanctioning and approving the transfer were without anyright or authority. The name of the defendant no. 1 wasordered to be entered in the revenue records by thesuperintendent Tarai and Bhabar Govt. Estates and entrieswere made accordingly. But these entries were not in orderand according to law or otherwise correct and nopresumption of correctness flows from them.

The breach of the covenant by the lease has given aright to the plaintiff of re-entry and as also a right to recoverdamages.

4. That on the expiry of the original lease on 20[th] June 1954the defendant No. 1 deposited rent at the enhanced ratesand applied for a renewal of the lease to which he was notentitled.

5. That the approval of the superintendent, Tarai and BhabarGovt. Estates; The entry in the revenue records on thepayment of the rent do not in any way confer the rights of alease on the defendant no. 1 whose possession continuesto be wrongful from its very inception and the plaintiff is A

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[2023] 10 S.C.R.

Aentitled to recover the possession of the premises in suitand also damages.

X-X-X-X”

42. Hence, it can be safely deduced that the Appellants did contendthe issue of prior approval from the initial stage itself. Apart from theBsaid eviction suit, two other proceedings need to be highlighted, i.e.consolidation proceedings which occurred between 1959-1960 andacquisition proceedings for a portion of land initiated by the militaryauthorities in 1963. In respect of the consolidation proceedings, we cannotdeduce the stand taken by State as no document or order in respect ofCthe same has been produced before us. However in respect of theacquisition, order dated 22.11.1965 passed by the concerned LandAcquisition Officer, which granted compensation to the predecessor ofRespondents has been brought on record wherein it must be noted thatcompensation was granted on the basis of revenue entries and withoutany serious examination of the validity of the same. Hence, both theseDproceedings cannot be treated as an admission of validity of revenueentries or as accepting the waiver of breach of the condition in respectof prior approval from the Deputy Commissioner.

43. Coming back to the aspect of prior approval, the Respondentsdrew our attention towards the vernacular copy of the order datedE07.08.1980 passed by the Commissioner, Kumaon, in the mutationproceedings to support the plea of grant of valid approval. The relevantpart of the said order in the vernacular language is as follows –

“Mool leejdhari shri John Vaughan ko Upayukta ki anumati2009 se lease hastantaran ke adhikar prapt the jo anumatiFmissal 14/23 dinank 6.12.48 dwara unhone prapt kar li thiaur jiske adhar par malkagjatomein 1948 mein sanshadhanbhi ho gayatha”[4]

[Broadly on translation in English, it would read: “Theoriginal lease holder Sri John Vaughan had rights to transferGwith the permission of Deputy Commissioner which permissionhe had received vide File 14/23 dated 6.12.48 and on thebasis of which amendments were made in the Revenue papersin 1948.”]

The following order makes it apparent that the approval from theHappropriate authority as per the lease deed, i.e. Deputy Commissioner was granted only on 06.12.1948 which is more than a year later than theSale Deed.

44. On the contrary, as per the recitals contained in the Sale Deedas extracted in Para 4 of this judgment, it is mentioned that due permissionwas obtained and the consequent mutation was effected in the office ofSuperintendent, Tarai and Bhabar, Nainital before its execution. Hence,this abovementioned recital leads to immense confusion as to whetherany approval was ever granted at the first instance. Even if such approvalwas granted, no indication is given as such to actually who granted theapproval and if it is assumed that a subordinate authority granted theapproval, no statutory instrument is produced before us to highlightwhether this delegation was possible or not. The subordinate courts aswell as the High Court have merely relied on the order dated 07.08.1980passed by the Commissioner, Kumaon to come to a sweeping conclusionthat a valid approval existed in favor of the predecessor of theRespondents despite glaring contradictions which were on the face ofthe record. Consequently, on this issue of breach of the conditions of the1924 Lease Deed, we again fail to arrive at a decisive conclusion asneither the original record nor its true copies have been placed on recordof this Court or the High Court as well as the other forums.

45. Finally, while the Respondents have argued that until thereexisted an express refusal by the Deputy Commissioner for sale ofleasehold rights, the sale was valid especially in light of post facto approvalgranted by the Deputy Commissioner as has been recorded in orderdated 07.08.1980 passed by the Commissioner. They have relied on thefollowing observation in U.P. Avas Evam Vikas Parishad[5]–

“6. This Court in Life Insurance Corpn. of India v. EscortsLtd. [(1986) 1 SCC 264], considering the distinction between“special permission” and “general permission”, “previousapproval” or “prior approval” in para 63 held that: “Weare conscious that the word ‘prior’ or ‘previous’ may beimplied if the contextual situation or the object and designof the legislation demands it, we find no such compellingcircumstances justifying reading any such implication intoSection 29(1) of the Act.” Ordinarily, the difference between 5 U.P. Avas Evam Vikas Parishad (n 1).

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Aapproval and permission is that in the first case the actionholds good until it is disapproved, while in the other case itdoes not become effective until permission is obtained. Butpermission subsequently granted may validate the previousAct.As to the word ‘approval’ in Section 33(2)(b) of theIndustrial Disputes Act, it was stated in Lord KrishnaBTextiles Mills Ltd. v. Workmen [AIR 1961 SC 860 : (1961) 1LLJ 211] , that the Management need not obtain theprevious consent before taking any action. The requirementthat the Management must obtain approval wasdistinguished from the requirement that it must obtainCpermission, of which mention is made in Section 33(1).

7. It is seen that the approval envisaged under Exception(iii) of Section 59(1)(a), is to enable the Parishad to proceedfurther in implementation of the scheme framed by theBoard. Until approval is given by the Government, theDBoard may not effectively implement the scheme.Nevertheless, once the approval is given, all the previousacts done or actions taken in anticipation of the approvalget validated and the publications made under the Actthereby become valid.”

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In this respect, we would like to hold that reliance on the same ismisdirected for the reason that the interpretation of a contractual conditionas contained in the present lease deed stands on a different footing thanthe interpretation of statutory provisions which were the subject matterin the case of U.P. Avas Evam Vikas Parishad.[6]F

46. It is now settled law that any contractual term or condition isto be interpreted as per the natural and ordinary meaning appended tothe language used by the parties unless the same leads to absurdity.[7] Inthe present case, condition (e) of the 1924 lease deed makes it clear thatGno rights in the Suit Land are allowed to be transferred or created“without the written approval of the Deputy Commissioner ofNainital” which bears the crystal clear requirement of the prior assentneeded from the Deputy Commissioner. This interpretation is also 6 U.P. Avas Evam Vikas Parishad (n 1).

7 M.O.H. Uduman v. M.O.H. Aslum, (1991) 1 SCC 412, para 14; Investors CompensationHScheme Ltd vs. West Bromwich Building Society, [1998] 1 All ER 98.

supported from the fact that leases under the Government Grants Act of1985 are to be strictly constructed as per the terms of the grant, regardlessof any other provisions of the law as noted in State of Uttar Pradesh vZahoor Ahmad[8] which states that –

“16. Section 3 of the Government Grants Act declares theunfettered discretion of the Government to impose suchconditions and limitations as it thinks fit, no matter whatthe general law of the land be. The meaning of sections 2and 3 of the Government Grants is that the scope of thatAct is not limited to affecting the provisions of the Transferof Property Act only. The Government has unfettereddiscretion to impose any conditions, limitations, orrestrictions in its grants, and the right, privileges andobligations of the grantee would be regulated according tothe terms of the grant, notwithstanding any provisions ofany statutory or common law.”

47. Additionally, the bench in U.P. Avas Evam Vikas Parishad[9]furthermore relied on the decisions rendered in Life Insurance Corpn.of India v. Escorts Ltd.[10]and Lord Krishna Textiles MillsLtd. v. Workmen[11], wherein the terms ‘permission’ and ‘approval’ wereused within same statute which necessitated the distinction betweenthese terms. Hence, the present case is distinguishable on this aspectalso, as no such distinction is warranted in the case at hand.

48. Even otherwise, the High Court and other authorities haveproceeded on the premise of a valid approval. They are completely silenton whether the post facto approval could be granted and if so, whogranted such approval. Again, no records are produced and its not knownwhether any approval was ever actually granted and when or by whom?

49. In our opinion, a reasoned finding on both the nature of SaleDeed as well as whether the same was violative of conditions of the1924 Lease Deed goes to the heart of the present dispute, because ofwhich the issue of determination of lease remains unanswered. Hence,in light of the same we must also note that the Respondents’ claim on 8 State of U.P. (n 3).

9 U.P. Avas Evam Vikas Parishad (n 1).

10 Life Insurance Corpn. of India v. Escorts Ltd. (1986) 1 SCC 264.

11 Lord Krishna Textiles Mills Ltd. v. Workmen AIR 1961 SC 860.

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Athe strength of doctrine of holding over or through doctrine ofacquiescence as well as the reliance on the conduct of Appellants, remainsin doldrums as the same are hinged on the finding in respect ofdetermination of lease. However, before moving forward, we musthighlight another aspect which requires application of mind by the HighCourt. We observe so for the reason that decades have passed in litigation,Band it would be extremely iniquitous to remand the case to revenueauthorities at such a belated stage.

C.3 RESPONDENT’S TITLE CLAIM THROUGHTENANCY LAW: THE CONUNDRUM OFVALIDITY OFREVENUE ENTRIESC

50. In the present case, revenue entries starting from 1948 haverecorded the Respondents’ predecessor as ‘Occupancy Tenant’ on thestrength of which they were accorded the status of ‘Sirdars’ vide theZamindari Notification. Consequently, this led to predecessor ofRespondents being accorded the status of ‘Bhumidhar’ as per theDapplicable statutory scheme. Since these entries carry the statutorypresumption of correctness in their favour, we must address them.

51. However, before delving into the issue of the tenancy statusof the Respondents, it would be appropriate to highlight the legislativehistory of the term ‘Occupancy Tenants’. Under the U.P. ZamindariEAbolition and Land Reforms Act, 1950[12], it is assigned the same meaningas employed in the 1939 Act which is as follows-

28. Occupancy tenants - Every tenant, who is not a fixedrate tenant or an exproprietary tenant and who, at thecommencement of this Act, has acquired a right ofFoccupancy under the Agra Tenancy Act, 1926, or anyprevious enactment relating to Agra, or under the OudhRent Act, 1886, shall be called an occupancy tenant, andshall have the rights and be subject to the liabilitiesconferred and imposed on occupancy tenants by this Act.

GHence by virtue of this definition, ‘Occupancy Tenants’ are theones who have acquired a right of occupancy under the Agra TenancyAct of 1926 and its legislative pre-enactment, i.e. Agra Tenancy Act of1901 or the Oudh Rent Act of 1886. Nevertheless, this provision only H12 Uttar Pradesh Zamindari Abolition and Land Reforms Act, 1950, s 3(26).

confirms the occupancy rights which were enjoyed at the commencementof the 1939 Act. Therefore, new occupancy tenancies cannot be createdeven if it is assumed that all the concerned parties consented to thesame.[13]

52. Even assuming arguendo that Mr. John Vaughn was deemedto have been granted status as an ‘Occupancy Tenant’ under the 1939Act, it should be noted that his status as an ‘Occupancy Tenant’ cannotbe transferred to the predecessor of Respondents in light of Section 33of the 1939 Act which is as follows –

“33. Interest of other tenants. - (1) The interest of a tenantholding on special terms in Oudh, of an ex-proprietarytenant, of an occupancy tenant, of a hereditary tenant, andof a non-occupancy tenant is heritable, but is not transferableotherwise than in accordance with the provisions of thisAct.

(2) Nothing in the foregoing provisions of this section shallrender illegal:

(a) a sub-lease of a holding as hereinafter provided.

(b) a sale of the interest of a tenant under theprovisions of Section 251.

(c) a release or transfer of an interest in favour of aco-tenant:

Provided that no person shall be deemed to be a co-tenant notwithstanding that he may have shared in thecultivation of the holding, unless he was a co-tenant fromthe commencement of the tenancy, or has become such bysuccession or has been specifically recognised as such inwriting by the land-holder.”

The only exception to the bar on transfer of status as an‘Occupancy Tenant’ in the abovementioned section is under sub-clause(b) of clause (2) wherein reference is made to Section 251 which inturns deals with sale of occupancy rights when the tenant himself isfacing the execution of a decree for arrears of rent. As no factual situationhas been indicated stating that Mr. John Vaughn had suffered a decree 13 Shambhu Dayal Singh, The Law of Tenancy in U.P. (3rd edn, Empire Press, 1949) 131.

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Afor rent arrears, we are unsure as to how any transfer of ‘OccupancyTenant’ status in favour of the predecessor of Respondents wassustainable. This confusion further indicates that the predecessor ofRespondents could not have been accorded the status of ‘Sirdar’ underthe Zamindari Notification on the strength of revenue entries whichrecorded him as an ‘Occupancy Tenant’.B

53. Hence, the High Court again made sweeping remarks inrespect of the tenancy status without any serious consideration as towhether the same were legally tenable or not. We must highlight that noreference is made to any proceedings wherein the status as an occupancytenant was ever granted to the predecessor of the Respondent and, ifCso, how and when the same culminated into the status of ‘Sirdar’ underthe Zamindari Notification. These proceedings which ultimately led tothe grant of status of ‘Bhumidhar’ in favour of the predecessor ofRespondents for the first time, could have potentially served as the litmustest for the validity of these revenue entries.

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54. Additionally, we must also take note of the finding of the HighCourt via its impugned judgement dated 07.10.2005 wherein it is heldthat predecessor of Respondents was rightly accorded the status of‘Sirdars’ under the Zamindari Notification on the ground that they werelease-holders governed by the Government Grants Act of 1895. However,Ethis finding again appears unsustainable because there is no proper factualanalysis as to when the 1924 Lease Deed stood determined or whetherthe same subsisted after the initial period of thirty years.

55. Before parting, we must also point out that initially the 1939Act was not applicable to the Suit Land as the concerned area where itFis situated was excluded from the purview of the 1939 Act, as it wasspecifically included in the First Schedule. Any future application of the1939 Act in respect of the Suit Land was supposed to be through aseparate notification, but the same has again not been produced in theseproceedings or before any forum, which further dissuades us fromrendering any final opinion at this stage.G

56. The same aspect has been highlighted by Appellants whocontend that the area in which the Suit Land is situated was governed bythe Kumaon Tenancy Rules of 1918. On the other hand, Respondentshave produced on record a - G.O. No. 5678/ 1-B-1212~B-19 dated the30.04.1948 titled ‘Tarai and Babbar Government Estates (Kham norms),H

Revised norms’ issued by Revenue (B) Department which notes asfollows –

“I. Tenants on admission on have hereditary rights asdefined in section 29 on the united provinces Tenancy Actexpect in the 55 Buxeris village mentioned in the firstschedule to the Act.”

This notification indicates the possibility of hereditary rights beingaccrued on predecessor of Respondents under the 1939 Act but again,we are constrained to give any finding on the same because of the lackof proper documents on record to ascertain the tenancy status of theRespondents. Hence, on this ground also the present appeals are liableto be remanded back so that the relevant statutory notifications, originalrecords can be placed before the High Court to enable it to determinethe applicable tenancy law and their impact on the alleged rights of theRespondents.

D. Conclusion

57. We are conscious of the fact that these appeals have beenpending before this Court for more than 15 years. In normalcircumstances, we would have ventured to decide the issues ourselvesbut in light of the abovementioned observations and dearth of appropriaterecords, we are constrained to hold that ownership rights in respect ofan immovable property cannot be decided casually. We are actually leftwith no other option but to remand these appeals back to the High Courtfor effective adjudication on merits.

58. Our hands are further tied because of the fact that theownership of certain portions of the Suit Land has apparently changedhands on account of subsequent sale by the Respondents. Furthermore,we must also note that the value of the Suit Land has increasedexponentially during the entire period of litigation and the relevant partieshave also done certain valuable developments. Any decision now cannotbe based on conjectures and surmises or on the basis of mere guesswork.Hence, we are reluctant to give a final opinion on the matter until theCourt is satisfied on the basis of the entirety of documents which showcasehow the ownership or possessory rights were created on the Suit Land.

59. There are indeed compelling circumstances which have beenleft unanswered by the courts below, because of which determination ofseveral factual issues have been left in limbo. Therefore, in light of the AB

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Apeculiar situation, we find it expedient to remand the present appealsback to the High Court for fresh adjudication on the issues formulated inPara 34 of this judgement and the observations made above. However,we hasten to add that these observations may not to be treated as finaldetermination on the merits of the dispute.

B60. Furthermore, in light of the long-drawn pendency of thesedisputes, we request the High Court to take up these matters at theearliest and dispose of the same as early as possible, preferably within aperiod of upcoming 12 months. However, all the original records, includingrevenue entries as well as that of the office of Deputy Commissioner,Nainital may be requisitioned. In this regard, we direct the AppellantCState to produce entire records and notifications before the High Courtand render assistance in the early disposal of these matters.

61. Consequently, these appeals are allowed in part; the impugnedjudgments of the High Court are set aside, and the matters are remandedto the High Court for a fresh adjudication. It is made clear that casualDfindings/observations made by Revenue Authorities or the Civil Courtshall not be accepted at their face value unless the High Court is satisfiedon a thorough inspection of the original or certified copies of the relevantrecord. The parties are directed to keep status quo until the matters aredecided afresh by the High Court.

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62. Ordered accordingly. Pending applications, if any, are alsodisposed of in above terms.

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Nidhi Jain

(Assisted by : Rakhi, LCRA)

Appeals partly allowed.

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