VINODCHANDRA SAKARLAL KAPADIA versus STATE OF GUJARAT AND ORS. on 15 June 2020

VINODCHANDRA SAKARLAL KAPADIA

v.

STATE OF GUJARAT AND ORS.

(Civil Appeal No. 2573 of 2020)

JUNE 15, 2020

[UDAY UMESH LALIT, INDU MALHOTRA

AND A. S. BOPANNA, JJ.]

Bombay Tenancy and Agricultural Lands Act, 1948 – ss.63,43 & 14, 17, 17B, 27, 29, 32, 32A, 32B, 32F, 32H, 32I, 32O, 32P,32PP, 32PPP, 32QQ, 32R, 32U, 33(1), 63A, 64, 84C, 88B, 88E –Agricultural land was in the cultivating possession of a tenant, whobecame deemed purchaser under the Act as he was cultivating theland on tiller’s day – Land bequeathed through Will in favour ofappellant – However, it was found that the appellant was not anagriculturist and the disposal by way of Will in his favour wascontrary to s.63 – Land was declared to be vested in the State –Division Bench inter alia held that s.63 bars the transfer ofagricultural land to a non-agriculturist for non-agriculturalpurpose unless permission is obtained from Collector/authorisedofficer – Held: Provisions of the Act intend to confer the advantageof statutory purchase upon a cultivating tenant, and see that “thetiller of the land” is conferred ownership w.r.t the lands cultivatedby him as well as the dwelling house occupied by him – In caseswhere the tenant is unable to exercise the right of purchase becausehis holding would go beyond ceiling limit, the land would not revertto the landlord, but in terms of s.32P, it must come to the persons orentities listed in the priority list (includes agricultural labourers,landless persons) – If a tenant or any other person from the prioritylist is conferred ownership in respect of the agricultural land orwhen a landlord is allowed to retain the land surrendered by histenant, each of them is obliged to cultivate the land personally – Incase any of them is unwilling, the land must be given to those whoprincipally depend upon agricultural operations for their sustenance– If a person is a beneficiary of such statutory purchase and wishesto transfer his holding, the law obliges that he must take priorsanction from the Collector – A transfer inter vivos would normallybe for consideration where the transferor may get value for the

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Aland but the legislation requires previous sanction of the concernedauthority so that the transferee can step into the shoes of transferorand carry out all the obligations – As against this, if a testamentarydisposition which does not have the element of consideration is tobe permitted, and if it is assumed that ss.43 & 63 do not get attracted,the land can be bequeathed to a total stranger and a non-Bagriculturist who may not cultivate the land himself leading toengagement of somebody as a tenant on the land – Legislative intentto do away with absentee landlordism; to protect the cultivatingtenants and to establish direct relationship between the cultivatorand the land would then be rendered otiose – In the context of theCentire scheme, the term “assignment” used in s.43 must includetestamentary disposition as well – View taken by Division Bench iscorrect – In pith and substance, the legislation and the concernedprovisions are completely within the competence of State Legislature– Interpretation of Statutes – Doctrine of pith and substance – IndianSuccession Act, 1925 – Land Laws and Agricultural Tenancy.D

Dismissing the appeals, the Court

HELD: 1.1 A) In terms of Section 32, on the tillers’ dayevery tenant satisfying the requirements spelt out in Section 32(1),and upto the ceiling limit as laid down in Section 32A, is deemedEto have purchased from his landlord, free from all encumbrances,the land held by him as tenant.

B) The purchase price payable by the tenant for suchdeemed purchase is to be determined in terms of Section 32H,according to which, in case of a permanent tenant the purchaseFprice has to be equal to six times the rent, while in case of othertenants, the purchase price would not be less than 20 times theassessment, and not more than 200 times the assessment.

C) In case the proceedings for eviction of the tenant arepending, the deemed date of purchase will stand postponed inGterms of the first proviso to Section 32.

D) Even if the tenant had lost the possession before thetillers’ day, in certain cases the possession can be restored tohim and the benefit of statutory purchase can be enjoyed by himas stipulated in sub-sections (1A) and (1B) of Section 32. Thebenefit of statutory purchase is also made available to tenants inH

areas within the limits of Municipal Boroughs, or within the limitsof Municipal Districts as contemplated by Section 32(4) of theAct.

E) If the landlord is under a disability, as stated in Section32F, the right to purchase the land can be exercised aftercessation of disability. In such cases, the period within which theright to purchase could be exercised was initially a fixed period,but facility is given in Section 32F(1A) that even if the period hadexpired, the tenant is still deemed to have purchased the land.

F) Even a sub-tenant of a permanent tenant is entitled tothe right of deemed purchase in terms of Section 32I and all theprovisions concerning deemed purchase are to apply to suchsub-tenant. The shares of purchase price are then to be allocatedin terms of Section 32I (3).

G) If the tenancy is created after the tillers’ day, in terms ofSection 32O, as it stood before its deletion (vide Gujarat ActNo.10 of 2009), a tenant could exercise the right of purchasewithin one year from the commencement of his tenancy.

H) If the purchase has become ineffective or there wasfailure on the part of the tenant to exercise the right of purchase,the Collector under Section 32P either suo motu, or on anapplication, can pass appropriate directions in terms of Section32P(2). In such cases, the land is to be disposed of to the personsin the priority list. At the top of the priority list is the tenanthimself, in case he is willing to accept the offer of sale, followedby various entities and persons including agricultural labourers,land-less persons, small holders and persons belonging toScheduled Castes and Scheduled Tribes.

I) If none of those persons in the priority list come forwardto purchase the land, the land is to vest in the State Government,whereupon in terms of Section 32P(4) the purchase price can bedetermined, which will then be paid to the owner of the land.

J) Where the purchase in favour of persons from the prioritylist in terms of Section 32 is effected, the price will be determinedin terms of Section 32P(5) read with other provisions, to be paidin annual instalments not exceeding six.

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AK) If any land was surrendered to the landlord before thespecified date and the possession of the land was taken by thelandlord, in terms of Section 32P(7), the landlord will be entitledto the use and occupation of the land so long as he cultivates theland personally. In such cases, by virtue of Section 32P(8) noland as described in Section 32P(7) can be transferred by sale,Bmortgage, lease or assignment without the previous sanction ofthe Collector.

L) Even in cases where the land is at the disposal of theCollector under Section 32P, by virtue of Sections 32PP, 32PPPadditional opportunities are granted to the tenant to avail of theCbenefit of statutory purchase. Even where the tenant had failedto deposit the purchase price, in cases covered by Section 32QQthe amount will be deposited on his behalf by the StateGovernment.

M) Upon payment of the last instalment, a certificate ofDpurchase is issued to the tenant or sub-tenant or such otherperson(s)/entities in the priority list, as the case may be. Thecertificate of purchase is conclusive evidence of the ownershipof such purchaser.

N) A right was conferred upon the tenant with respect to aEdwelling house under Section 17 whereunder the tenant was giventhe first option of purchasing the site at a value, to be determinedby the tribunal. However, by virtue of the newly incorporatedSection 17B, every tenant is deemed to have purchased from hislandlord the site on which the dwelling house occupied by suchFtenant is built and the land immediately appurtenant thereto andnecessary for the enjoyment of dwelling house.

O) If the landlord intends to sell any land, he must apply tothe tribunal in terms of Section 64 which may thereafter determinethe reasonable price, and the offer has to be made in terms ofGSection 32P to the concerned persons.

P) Section 88B had granted exemption from the provisionspertaining to statutory purchase and determination of price inrespect of lands held by a University or a trust for an educationalpurpose, a hospital, punjarapol or Gaushala and to lands donatedby any person for the purposes of rendering any services to theH

community. However, in terms of Section 88E, such exemptionceased to operate from the specified date, and the tenants ofsuch lands are also deemed to have purchased the land on thespecified date, and all the relevant provisions regarding statutorypurchase would then apply to such land.

Q) Section 32R obliges the purchaser of land to cultivatethe land personally, and in case of failure, the land can be disposedof in terms of Section 84C of the Act.

The aforesaid provisions deal with matters pertaining toand arising out of proceedings related to statutory purchase.Sections 14 and 29 do not belong to that category. In terms ofSection 14, if the land “is assigned” in contravention of Section27, the tenancy of the tenant is liable to be terminated. Section27 states in clear terms that “assignment of any interest” in theland by a tenant shall not be valid. The decision of this Court inBhavarlalhas stood the test of time which clearly states that atenancy governed by a statute which prohibits assignment, cannotbe willed away to a total stranger. The expression “assignment”in Sections 14 and 27, if understood in light of the decision of thisCourt in Bhavarlalwhich has consistently been followed, mustinclude testamentary disposition. There is nothing in theprovisions of the Act to suggest that the expression “assignment”must carry a different meaning in Sections 14 and 27 on the onehand, and Section 43 on the other. [Paras 20, 21][977-H; 978-A-H; 979-A-H; 980-A-E]

Bhavarlal Labhchand Shah v. Kanaiyalal Nathalal Intawala(1986) 1 SCC 571 : [1986] 1 SCR 1 – affirmed.

1.2 The provisions hereinabove intend to confer theadvantage of statutory purchase upon a cultivating tenant, andsee that “the tiller of the land” is conferred ownership with respectto the lands cultivated by him as well as the dwelling houseoccupied by him. Thus, a cultivating tenant, if his holding isotherwise not beyond the ceiling limit, would be given the rightto own the land cultivated by him. In cases where no purchasecould be effected either on account of inability of the tenant topay the purchase price, or on account of other situations, morethan one attempt and opportunities are afforded to him. The A

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Astatute goes to the extent of obliging the State Government todeposit the purchase price on his behalf. Even in cases wherethe tenant is unable to exercise the right of purchase becausehis holding would go beyond ceiling limit, the land would notrevert to the landlord, but in terms of Section 32P, it must cometo the persons or entities listed in the priority list. The priorityBlist includes persons such as agricultural labourers and landlesspersons. The scheme is, therefore, to effectuate distribution ofagricultural lands in such a way that the persons who aredisadvantaged, would be conferred the ownership. After suchpurchase, the law obliges the purchaser to cultivate the landCpersonally and not to transfer it. [Para 22][981-B-E]1.3 If a tenant or any other person from the priority list isconferred ownership in respect of the agricultural land or when alandlord is allowed to retain the land which was surrendered byhis tenant, each one of them is obliged to cultivate the land Dpersonally. In case any of them is unwilling, the land must begiven to those who principally depend upon agricultural operationsfor their sustenance. If a person is a beneficiary of such statutorypurchase and wishes to transfer his holding the law obliges thathe must take prior sanction from the Collector. While granting such sanction, the authorities may essentially check whether theEtransferee is an agriculturist or an agricultural labour whootherwise fulfils the requirements and would carry out theobligation of cultivating the land personally; and that his holdingwould not go beyond the ceiling limit. Since the ownership itselfwas conferred as a result of the legislative scheme as discussedFhereinabove, these conditions are inherent in the very conferralof ownership and, therefore, specifically incorporated in Section43 with direct reference to the provisions named therein. Atransfer inter vivos would normally be for consideration wherethe transferor may get value for the land but the legislationrequires previous sanction of the concerned authority so thatGthe transferee can step into the shoes of the transferor, and carryout all the obligations as a part of legislative scheme must bedischarged. Thus, the screening whether a transferee is eligibleor not, can be undertaken even before the actual transfer iseffected. As against this, if a testamentary disposition which doesH

not have the element of consideration is to be permitted, and if itis assumed that Sections 43 and 63 of the Act do not get attracted,the land can be bequeathed to a total stranger and anon-agriculturist who may not cultivate the land himself; whichin turn may then lead to engagement of somebody as a tenant onthe land. The legislative intent to do away with absenteelandlordism and to protect the cultivating tenants, and to establishdirect relationship between the cultivator and the land would thenbe rendered otiose. The construction put on the expression“assignment” appearing in Section 43, therefore, has to beconsistent with the legislative scheme. In the context of the entirescheme, the term “assignment” used in Section 43 of the Actmust include testamentary disposition as well. By adopting suchconstruction, in keeping with the law laid down by this Court, thestatute would succeed in attaining the object sought to beachieved. On the other hand, if it is held that the testamentarydisposition would not get covered by the provisions of Section43, a gullible person can be made to execute a testament in favourof a person who may not fulfil the requirements and be eligible tobe a transferee in accordance with law. This may not only renderthe natural heirs of the tenant without any support or sustenance,but may also have serious impact on agricultural operations. Inthe circumstances the view taken by the Division Bench of theHigh Court in the present matter is absolutely correct and doesnot call for any interference. The decision is completely consistentwith the law laid down by this Court in Sangappaand Jayammaand the other cases referred to hereinabove and must be acceptedto be the correct exposition of law. [Paras 23-25][982-D-H;983-A-E]

Sangappa Kalyanappa Bangi (Dead) through LRs. v.Land Tribunal, Jamkhandi and OthersAIR 1998 SC3229 : (1998) 7 SCC 294 : [1998] 1 Suppl. SCR 600;Jayamma v. Maria Bai (Dead) by proposed LRs andAnotherAIR 2004 SCW 4412 : (2004) 7 SCC 459 :[2004] 3 Suppl. SCR 175 – affirmed.

1.4 If the provisions referred to in Section 43 of the Actand allied provisions are considered in light of the settledprinciples extracted earlier, it emerges that the primary concern AB

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Aof those provisions is to see that the legislative scheme of grantingprotection to persons from disadvantaged categories andconferring the right of purchase upon them, and thereby ensuredirect relationship of a tiller with the land. The provisions, thoughlay down a norm which may not be fully consistent with theprinciples of Indian Succession Act, are principally designed toBattain and sub-serve the purpose of protecting the holdings inthe hands of disadvantaged categories. The prohibition againsttransfers of holding without the previous sanction of theconcerned authorities, is to be seen in that light as furthering thecause of legislation. Even if by the process of construction, theCexpression “assignment” is construed to include testamentarydisposition, in keeping with the settled principles, the incidentalencroachment cannot render the said provisions invalid. In pithand substance, the legislation and the concerned provisions arecompletely within the competence of the State Legislature and by placing the construction upon the expression “assignment”Dto include testamentary disposition, no transgression will ensue.The construction put by the Division Bench on the provisionsthat fell for consideration is accepted. The challenge to the viewtaken by the Division Bench must therefore be rejected. Thedecision of this Court in Mahadeowhich had failed to notice theEearlier decisions in Sangappaand Jayammaand which isinconsistent with the decisions referred to hereinabove and whatthe Court has concluded, must be held to be incorrectly decided.[Paras 31, 33][999-E-G; 1000-A-B]

Mahadeo (Dead through legal representatives) v.FShakuntalabai(2017) 13 SCC 756 – held incorrectlaw.

Girnar Traders (3) v. State of Maharashtra and Others(2011) 3 SCC 1 : [2011] 3 SCR 1 – followed.

Manchegowda v. State of Karnataka(1984) 3 SCCG301 : [1984] 3 SCR 502;Lingappa Pochanna Appelwarv. State of Maharashtra and another(1985) 1 SCC 479: [1985] 2 SCR 224; Pandey Oraon v. Ram ChanderSahu and Others (1992) 2 Suppl. SCC 77; AmrendraPratap Singh v. Tej Bahadur Prajapati and OthersH(2004) 10 SCC 65 : [2003] 6 Suppl. SCR 42; State of VINODCHANDRA SAKARLAL KAPADIA v. STATE OFGUJARAT AND ORS.

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Rajasthan and Others v. Aanjaney Organic HerbalPrivate Limited (2012) 10 SCC 283 : [2012] 7 SCR1148;Rajasthan Housing Board v. New Pink CityNirman Sahkari Samiti Limited and Another(2015) 7SCC 601 : [2015] 5 SCR 365;Samatha v. State of A.P.and Others(1997) 8 SCC 191 : [1997] 2 Suppl. SCR305; Welfare Association, A.R.P., Maharashtra andAnother v. Ranjit P. Gohil and Others(2003) 9 SCC358 : [2003] 2 SCR 139; State of Maharashtra v. BharatShanti Lal Shah and Others(2008) 13 SCC 5 : [2008]12 SCR 1083 – relied on.

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State of Punjab (now Haryana) and Others v. Amar Singhand Another(1974) 2 SCC 70 : AIR 1974 SC 994 :[1974] 3 SCR 152; Dayandeo Ganpat Jadhav v.Madhav Vithal Bhaskar and Others(2005) 8 SCC340 : [2005] 4 Suppl. SCR 439; Timmakka KomVenkanna Naik v. Land Tribunal(1987) 2 Kant LJ 337;State of W.B. v. Kailash Chandra Kapur(1997) 2 SCC387 : [1996] 9 Suppl. SCR 398; S. Rathinam aliasKappamuthu and Others v. L.S. Mariappan and Others(2007) 6 SCC 724 : [2007] 7 SCR 568; Jaspal Singhv. Additional District Judge, Bulandshahr& Ors.(1984)4 SCC 434 : [1985] 1 SCR 889; Dr. Anant TrimbakSabnis v. Vasant Pratap PandiAIR 1980 Bombay 69;Lincai Gamango and Others v. Dayanidhi Jena andOthers(2004) 7 SCC 437 : [2004] 2 Suppl. SCR 825;Shamjibhai Keshavjibhai Kansagra (Patel) & Ors. v.Principal Secretary, Revenue Dept. (Appeals) & Ors.AIR 2011 Gujarat 55 – referred to.

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[2020] 5 S.C.R.

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2573of 2020.

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From the Judgment and Order dated 17.03.2009 of the High Courtof Gujarat at Ahmedabad in Special Civil Application No. 25058 of 2006.

With

Civil Appeal Nos. 2574, 2575, 2576, 2577, 2578, 2579, 2581, 2583,F2584 of 2020.

Sanjay Parikh, Sr. Adv., Ms. K. V. Bharathi Upadhyaya,Raghavendra S. Srivatsa, Pai Amit, Rahat Bansal, Aniruddha P. Mayee,A. Rajarajan, Purvish Jitendra Malkan, Ms. Dharita Purvish Malkan,Alok Kumar, Ms. Bhavna Sarkar, Ms. Deepa Gorasia, Neerav Thakkar,GMs. Bina Madhavan, Katubadi Ismail, M/s. Lawyer S Knit & Co, P. S.Sudheer, Rishi Maheshwari, Ms. Mayuri Nayyar Chawla, Ms. AnneMathew, Bharat Sood, Ms. Shruti Jose, Divyesh Sejpal, S. Hariharan,Ms. Jaikriti S. Jadeja, Vikash Singh, Somesh Chandra Jha, AnandDarshan, Rahul Narang, Mahesh Agarwal, Abhinav Agrawal, NishantRoa, E. C. Agrawala, Rajiv Kumar, Krishna M. Singh, Sanjeev Gupta,HSandeep Kumar, Rameshwar Prasad Goyal, Nikhil Goel, Dushyant Sarna (for A. Venayagam Balan), Ms. Hemantika Wahi, Rahul Gupta, Advs.for the appearing parties.

The Judgment of the Court was delivered by UDAY UMESH LALIT, J.

1. Leave granted.

2. These Appeals arise out of the common judgment and orderdated 17.03.2009 passed by the Division Bench of the High Court ofGujarat at Ahmedabad in Special Civil Application No.25058 of 2006and all other connected matters while answering the questions referredto it by a Single Judge of the High Court. The questions that arose forconsideration and the circumstances in which the matters were referredto it were set out by the Division Bench as under:-.

“We are called upon to decide as to whether Section 63 of theBombay Tenancy and Agricultural Lands, Act, 1948 (for short‘the Bombay Tenancy Act’) debars an agriculturist from partingwith his agricultural land to a non-agriculturist through a “Will” soalso, whether Section 43(1) of the Tenancy Act restricts transferof any land or interest purchased by the tenant under Sections17B, 32, 32F. 321. 320, 32U, 33(1) or 88E or sold to any personunder Section 32P or 64 of the Tenancy Act through the executionof a Will by way of testamentary disposition.

Learned Single Judges of this Court have taken a consistentview that such transfer of property through testamentary dispositionwould not violate Section 43 or 63 of the Tenancy Act, JusticeJ.B. Mehta in the case of Manharlal Ratanlal @ RadmansinhChausinh v. Taiyabali Jaji Mohamed & others (1967-68 (Vol.5)GLT 199) while interpreting Section 43(1) of the Tenancy Acttook the view that the expression ‘transfer’ which is used in Section43(1) of the Tenancy Act must be interpreted in light of the Transferof Property Act viz. the transfer by way of act of parties. LearnedJudge took the view that, if the Legislature wanted to include atransfer by operation of law as to include succession, insolvency,inheritance, etc. or sales by public auction, specific provision wouldhave been made to that effect. Learned Judge held all the specificcategories which are mentioned are all of transfers by act of parties,bequest by Will cannot be included in the scope of the term ‘gift’

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or ‘assignment’. Justice Rajesh Balia in GhanshyambhaiNabheram v. State of Gujarat and others (1999 (2) GLR 1061)while interpreting Section 63 of the Tenancy Act took a view thatjust like, a non-agriculturist be not deprived of his inheritance, alegatee under a Will, can also be a non-agriculturist, hence, thereis no bar in succeeding the property through testamentarydisposition. Learned Judge held that Revenue Laws dealing withagricultural lands have not made the land uninheritable and theyalso do not disqualify a non-agriculturist from inheritance nor anumber of persons are disentitled from succeeding to estate of anagriculturist as body of successors, which may result in welldefined share of the estate of deceased vesting in them individually.Justice Rajesh Balia again in Pravinbhai Bhailalbhai Gor v.Rajkumar Gupta, collector, Vadodara (1999(1) GLR 440) whileinterpreting Section 43 and 63 of the Tenancy Act took the viewthat both provisions clearly go to show that they refer only totransaction or transfer or agreement to transfer of land or anyinterest therein which are inter vivos and not to vesting of suchrights in anyone as a result of transmission or as a result ofsuccession on death of holder and the provisions do not affect theoperation of law of inheritance. Appeal filed against the abovejudgment was, however, dismissed in State of Gujarat v. P.B.Gor (2000 (3) GLR 2168). Justice K.A. Puj also took identicalview in Gasfulbhai Mohmadbhai Bilakhia v. State of Gujarat(2005 (1) GLR 575) and Gopiraj Dedraj Agrawal (Gopiramtudraj Agrawal) v. State of Gujarat (2004 (1) GLR 237). LearnedJudge also made reference to the Circular dated 13.02.1989 issuedby the State Government and took a view that that Section 43 aswell as Section 63 of the Tenancy Act would not debar transferof property by testamentary disposition. Justice R.K. Abichandanialso took the same view in Babubhai Mervanbhai Patel v. Stateof Gujarat 2005 (1) GLH (UJ) 3. Learned Single Judge JusticeJayant Patel expressed some doubts about the views expressedin the above-referred judgments and felt that the matter requiresre-consideration in light of the decisions rendered by the ApexCourt in Sangappa Kalyanappa Bangi (dead) through LR (AIR1998 SC 3229 = (1998) 7 SCC 294 Rajendra Babu J. andJayamma v. Maria Bai and another (2004) 7 SCC 459 Sinha,J.) and hence these matters have been placed before us.”

3. Sections 43 and Section 63 of the Act[1] are quoted here forready reference:- “43. Restriction on transfers of land purchased or sold underthis Act:

(1) No land or any interest therein purchased by a tenant undersection 17B, 32, 32F, 32I, 32O[2], 32U, 43-1D or 88E or sold to anyperson under Section 32P or 64 shall be transferred or shall beagreed by an instrument in writing to be transferred, by sale, gift,exchange, mortgage, lease or assignment, without the previoussanction of the Collector and except in consideration of paymentof such amount as the State Government may by general or specialorder determine; and no such land or any interest, therein shall bepartitioned without the previous sanction of the Collector.

Provided that no previous sanction of the Collector shall berequired, if the partition of the land is among the members of thefamily who have direct blood relation or among the legal heirs ofthe tenant:

Provided further that the partition of the land as aforesaidshall not be valid if it is made in contravention of the provisions ofany other law for the time being in force:

Provided also that such members of the family orthe legal heirs shall hold the land, after the partition, on thesame terms, conditions and restrictions as were applicable tosuch land or interest therein purchased by the tenant or theperson.

(1A) The sanction under sub-section (1) shall be given by theCollector in such circumstances and subject to such conditions,as may be prescribed by the State Government.

(1AA) Notwithstanding anything contained in sub-section (1), itshall be lawful for such tenant or a person to mortgage or create a charge on his interests in the land in favour of the StateGovernment in consideration of a loan advanced to him by theState Government under the Land Improvement Loans Act, 1983, 1 The Bombay Tenancy and Agricultural Lands Act, 1948 as applicable to State ofGujarat.

2 The words ‘32O’ were deleted by Guj. Act No.10 of 2009

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the Agriculturists’ Loans Act, 1984, or the BombayNon-agriculturists’ Loans Act, 1928, as in force in the State ofGujarat, or in favour of a bank or co-operative society, and withoutprejudice to any other remedy open to the State Government,bank or co-operative society, as the case may be, in the event ofhis making default in payment of such loan in accordance withthe terms on which such loan was granted, it shall be lawful forthe State Government, bank or co-operative society, as the casemay be, to cause his interest in the land to be attached and soldand the proceeds to be applied in payment of such loan.

Explanation. – For the purposes of this sub-section, “bank”means –

(a) the State Bank of India constituted under the StateBank of India Act,1955; (b) any subsidiary bank as defined in clause (k) of Section2 of the State Bank of India (Subsidiary Banks) Act,1959;

(c) any correspondent new bank as defined in clause (d)of Section 2 of the Banking Companies (Acquisitionand Transfer of Undertakings) Act, 1970; (d) the Agricultural Refinance and Developmentcorporation, established under the AgriculturalRefinance and Development Corporation Act, 1963.

(1B) Nothing in sub-section (1) or (1AA) shall apply to landpurchased under Section 32, 32F, or 64 by a permanent tenantthereof, if prior to the purchase, the permanent tenant, by usage,custom, agreement or decree or order of a court, held atransferable right in the tenancy of the land.

(1C) The land to which sub-section (1) applies and for which nopermission is required under sub-section (1) of section 65B of theBombay Land Revenue Code, 1879 for use of such land for abonafide industrial purpose may, notwithstanding anythingcontained in sub-section (1) of this section, be sold without theprevious sanction of the Collector under sub-section (1) but subjectto payment of such amount as may be determined by the StateGovernment under sub-section (1).

(2) Any transfer or partition, or any agreement of transfer, or anyland or any interest therein in contravention of sub-section (1)shall be invalid.

63. Transfers to non-agriculturists barred.

(1) Save as provided in this Act:-

(a) no sale (including sales in execution of a decree of a CivilCourt or for recovery of arrears of land revenue or forsums recoverable as arrears of land revenue), gift,exchange or lease of any land or interest therein, or (b) no mortgage of any land or interest therein, in which thepossession of the mortgaged property is delivered to themortgage, or

(c) no agreement made by an instrument in writing for thesale, gift, exchange, lese or mortgage of any land or interesttherein, shall be valid in favour of a person who is not an agriculturist orwho being an agriculturist cultivates personally land not less thanthe ceiling area whether as an owner or tenant or partly as ownerand partly as tenant or who is not an agricultural labourer:

Provided that the Collector or an officer authorised by the Stategovernment in this behalf may grant permission for such sale, gift,exchange, lease or mortgage, or for such agreement on suchconditions as may be prescribed.

Provided further that no such permission shall be granted, whereland is being sold to a person who is not an agriculturist foragricultural purpose, if the annual income of such person fromother sources exceeds five thousand rupees.

(1A) The State Government may, by notification in the OfficialGazette, exempt from the provisions of sub-section (1), for thetransfer of any agricultural land to any public trust established forthe charitable purpose and which is non-profitable in nature, forthe use of such land in the field of health and education, subject tosuch conditions as may be specified therein.

(2) Nothing in this section shall be deemed to prohibit the sale,gift, exchange or lease, or the agreement for the sale, gift, A

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exchange or lease, of a dwelling house or the site thereof or anyland appurtenant to it in favour of an agricultural labourer or anartisan or a person carrying on any allied pursuit.

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(3) Nothing in this section shall apply or be deemed to have appliedto a mortgage of any land or interest therein effected in favour ofa co-operative society as security for the loan advanced by suchsociety or any transfer declared to be a mortgage by a court undersection 24 of the Bombay Agricultural Debtors’ Relief Act, 1947.

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(4) Nothing in Section 63A shall apply to any sale made undersub-section (1).”

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4. The Sections of the Act which are referred to in said Section43 and in the light of which the reference was answered by the DivisionBench as well as some other Sections having bearing on the matters inissue, are extracted hereunder:

“17. Tenant to be given first option of purchasing site onDwhich he has built dwelling house.-

(1) If a landlord to whom the site referred to in section 16 belongs,intends to sell such site, the tenant at the expense of whom orwhose predecessor-in-title, a dwelling house is built thereon shallbe given in the manner provided in sub-section (2) of the firstoption of purchasing the site at a value determined by the Tribunal.

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(2) The landlord intending to sell such site shall give notice inwriting to the tenant requiring him to state within three monthsfrom the date of service of such notice whether he is willing topurchase the site.

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(3) If within the period of three months so specified the tenantintimates in writing to the landlord that he is willing to purchasethe site, the landlord shall make an application to the Tribunal forthe determination of the value of the site. On receipt of suchapplication the Tribunal after giving notice to the tenant and afterholding an inquiry shall determine the value of the site [whichshall not exceed 20 times the annual rent thereof]. The Tribunalmay, by an order in writing require the tenant to deposit the amountof value of such site [within one year] from the date of suchorder. On the deposit of such amount the site shall be deemed tohave been transferred to the tenant and the amount deposited G

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shall be paid to the landlord. The Tribunal shall on payment of theprescribed fees grant a certificate in the prescribed form to suchtenant specifying therein the site so transferred and the name ofsuch tenant.

(4) If the tenant fails to intimate his willingness to purchase thesite within the time specified in sub-section (2) or fails to depositthe amount of the value within the time specified in sub-section(3) the tenant shall be deemed to have relinquished his right offirst option to purchase the site and the landlord shall then beentitled to evict the tenant either on payment of such compensationfor the value of the structure of such dwelling house as may bedetermined by the Tribunal or allow the tenant at his option toremove the materials of the structure.

(5) Any sale of a site held in contravention of this section shall benull and void.

17B. Tenant to be deemed to have purchased sites referredto in section 16 from specified date.

(1) On and with effect from such date as the State Governmentmay, by notification in the Official Gazette, specify, every tenantreferred to in section 16 shall be deemed to have purchased fromhis landlord the site on which the dwelling house occupied bysuch tenant, was built, and the land immediately appurtenant theretoand necessary for enjoyment of the dwelling house free from allencumbrances at the price to the fixed by the Tribunal, being aprice not exceeding twenty times the annual rent for the site.

(2) [Deleted by Guj. Act No.5 of 1973]

(3) As soon as may be thereafter, the Tribunal shall publish orcause to be published a notice in such village within its jurisdictionin which all such sites are situate and shall, as far as practicable,issue notice to each such landlord and tenant and to any otherperson interested in such site to appear before it on the datespecified in the notice. The notice published in a village shall beaffixed in the Chavdi or at such public place as the Tribunal maydirect.

(4) The Tribunal shall, after giving an opportunity to such landlord,tenant and other person interested to be heard and after holdingan inquiry determine the price of the site.

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(5) On the determination of the price of the site under sub-section(4), the tenant shall deposit the amount of such price with Tribunal- (a) either in lump sum within one year from such date, or (b) in such instalments not exceeding three with simple interestat the rate of 4½ per cent per annum, and at such intervalsduring the period not exceeding three years and on orbefore such dates.

as may be fixed by the Tribunal and the Tribunal shall direct thatthe amount deposited in lump sum or the amount of the instalmentsdeposited at each interval shall be paid in accordance with theprovisions of section 32Q so far as they are applicable.

(6) On the deposit the amount of the price in lump sum or of thelast instalment of such price, the Tribunal shall, on payment of aprescribed fee, grant a certificate in the prescribed form to thetenant declaring him to be the purchaser to the site. Such certificateshall be conclusive evidence of the sale.

(7) If the tenant fails to pay any instalment on or before the datefixed by the Tribunal under sub-section (5), the amount of suchinstalment and the interest thereon shall be recovered as an arrearof land revenue.

(8) If after holding an inquiry under sub-section (4), the Tribunalis satisfied that the tenant is not willing to purchase the site, theTribunal shall issue a certificate to the landlord to that effect. Onthe issue of such certificate the landlord shall be entitled to evictthe tenant and dispose of the site in such manner as he may thinkfit either on payment of such compensation for the value of thestructure of such dwelling house as may be determined by theTribunal, or after allowing the tenant, at his option, to remove thematerials of the structure;

Provided that the landlord shall not dispose of the site inany manner except by first giving option of purchasing the samefor the price determined by the Tribunal, to an agricultural labourer,landless person, small holder or a village artisan, who owns nohouse site, in the said order of priority and where any site is disposedof without giving such option such disposal shall be void:

Provided further that the provisions of section 63 shall applyto the disposal of the site in any manner in a case where theoption of purchase is not exercised by any of the persons mentionedin the first proviso.

-32. Tenants deemed to have purchased land on tillers’ day.

(1) On the first day of April 1957 (hereinafter referred to as “thetillers’ day”) every tenant shall, subject to the other provisions ofthe next succeeding sections, be deemed to have purchased fromhis landlord, free of all encumbrances subsisting thereon on thesaid day, the land held by him as tenant, if- (a) such tenant is a permanent tenant thereof and cultivatesland personally; (b) such tenant is not a permanent tenant but cultivates theland leased personally; and

(i) the landlord has not given notice of termination of histenancy under section 31; or

(ii) notice has been given under section 31, but the landlordhas not applied to the Mamlatdar, on or before the 31stday of March 1957 under section 29 for obtainingpossession of the land ; or

(iii) the landlord has not terminated his tenancy on any ofthe grounds specified in section 14, or has so terminatedthe tenancy but has not applied to the Mamlatdar on orbefore the 31st day of March, 1957 under section 29for obtaining possession of the land:

Provided that if an application made by the landlord undersection 29 for obtaining possession of the land has been rejectedby the Mamlatdar or by the Collector in appeal or in revision bythe Gujarat Revenue Tribunal under the provision of this Act, thetenant shall be deemed to have purchased the land on the date onwhich the final order of rejection is passed. The date on whichthe final order of rejection is passed is hereinafter referred to as“the postponed date”:

Provided further that the tenant of a landlord who is entitledto the benefit of the proviso to sub-section (3) of section 31 shall A

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be deemed to have purchased the land on the 1st day of April,1958, if no separation of his share has been effected before thedate mentioned in that proviso.

(1A) (a) Where a tenant, on account of his eviction from the landby the landlord, before the 1st April, 1957, is not in possession ofthe land on the said date but has made or makes an application forpossession of the land under sub-section (1) of section 29 withinthe period specified in that sub-section, then if the application isallowed by the Mamlatdar, or as the case may be, in appeal by theCollector or in revision by the Gujarat Revenue Tribunal, he shallbe deemed to have purchased the land on the date on which thefinal order allowing the application is passed.

(b) Where such tenant has not made an application forpossession within the period specified in sub-section (1) of section29 or the application made by him is finally rejected under thisAct, and the land is held by any other person as tenant on theexpiry of the said period or on the date of the final rejection of theapplication, such other person shall be deemed to have purchasedthe land on the date of the expiry of the said period or as the casemay be, on the date of the final rejection of the application.

(1B) Where a tenant who was in possession of land on theappointed day and who, on account of his being dispossessed ofsuch land or any part thereof by the landlord at any time beforethe specified date otherwise than in the manner provided in section29 or any other provision of this Act, is not in possession of suchand or any part thereof and such land or part thereof is in thepossession of the landlord or his successor-in-interest on the saiddate and such land or part thereof is not put to a non-agriculturaluse on or before the said date, then the Mamlatdar shall,notwithstanding anything contained in the said section 29 or anyother provision of this Act either suo motu or on an application ofthe tenant made within the prescribed period hold an inquiry anddirect that such land or as the case may be, part thereof shall betaken from the possession of the landlord or, as the case may be,his successor in interest, and shall be restored, to the tenant; andthereafter, the provisions of this section and sections 32A to 32R(both inclusive) shall, so far as they may be applicable, apply thereto,subject to the modification that the tenant shall be deemed to have purchased such land or part thereof on the date on which suchland or, as the case may be, part thereof is restored to him:

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Provided that the tenant shale be entitled to restoration ofland or part thereof, as the case may be, under this sub-sectiononly if he gives an undertaking in writing within such period asmay be prescribed to cultivate it personally and of so much thereofas together with the other land held by him as owner or tenantshall not exceed the ceiling area:

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Provided further that -

(i) if the tenant fails to give such undertaking within suchprescribed period, or if the tenant, after giving suchundertaking, refuses to accept the tenancy or possessionof the lands, the land the possession of which thelandlord or as the case may be, his successor-in-interestsis not entitled to retain under this sub-section; or C

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(ii) if the tenant gives such undertaking and accepts suchtenancy or possession of the land, such portion of theland referred to in clause (i) to the restoration of whichthe tenant would not be entitled under the first proviso, shall vest in the State Government free from all encumbrances,and shall be disposed of in the manner provided in sub-section (2)Eof section 32 P.

Explanation. - In this sub-section “successor in interest”means a person who acquires the interest by testamentarydisposition or devolution on death.

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(2) Where by custom, usage or agreement or order of a Court,any warkas land belonging to the landlord is used by the tenantfor the purpose of rab manure in connection with rice cultivationin the land held by him as tenant- (a) the whole of such warkas land, or G

(b) as the case may be, such part thereof as the Tribunal maydetermine in cases where such warkas land, is jointly usedby more persons than one for the purposes of rab manure, shall be included in the land to be deemed to have beenpurchased by the tenant under sub-section (1):

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Provided that in cases referred to in clause (b) the Tribunalmay determine that such warkas land shall be jointly held by personsentitled to use the same, if in the opinion of the Tribunal, the partitionof such warkas land by metes and bounds is neither practicablenor expedient in the interest of such persons.

(3) In respect of the land deemed to have been purchased by atenant under subsection (1),- (a) the tenant shall continue to be liable to pay to the landlordthe rent of such land, and (b) the landlord shall continue to be liable to pay to the StateGovernment the dues, if any, referred to in clauses (a), (b),(c) and (d) of sub-section (1) of section 10A, where thetenant is not liable to pay such dues under subsection (3)of that section.

until the amount of the purchase price payable by the tenant tothe landlord is determined under section 32H.

(4) On the date of the commencement of the Bombay Tenancyand Agricultural Lands (Gujarat Amendment) Act, 1960 (GujaratXVI of 1960), every tenant in the areas within the limits ofMunicipal Boroughs Act, 1925 (Bombay XVIII of 1925), or withinthe limits of municipal districts constituted under the BombayDistrict Municipal Act, 1901 (Bombay III of 1901), shall, subjectto the other provisions of this Act, be deemed to have purchasedfrom a landlord free from all encumbrances subsisting thereon onthe said date the land held by him as tenant, as if the said datewere the tillers’ day:

Provided that nothing in this sub-section shall apply to landleased by a landlord and situated within the limits of, any suchMunicipal borough or municipal district, if such land does not exceedan economic holding and the total annual income of the landlordincluding the rent of such land does not exceed Rs. 1,500 andsuch land is not held under a permanent tenancy.

(5) A person eligible to the exemption as provided in the proviso tosub-section (4), shall make an application before the 1st day ofJuly 1961 to the Mamlatdar for a certificate as provided in section88C, and the provisions of sub-sections (2) to (4) of that section shall apply thereto as if the application had been made under section88C.

(6) The provisions of sections 32S, 32T and 32U shall mutatismutandis apply to the termination of tenancy of such land by alandlord holding a certificate under sub-section (5) and purchaseof such land by the tenant thereof as if such landlord were acertified landlord and such tenant were an excluded tenant withinthe meaning of those sections.

32A. Tenants deemed to have purchased up to ceiling area:-A tenant shall be deemed to have purchased land under section32 –

(1) in the case of a tenant who does not hold any land as ownerbut holds land as tenant in excess of the ceiling area, up to theceiling area;

(2) in the case of a tenant who holds land as owner below theceiling area, such part of the land only as will raise his holding tothe extent of the ceiling area.

32B. When tenants not deemed to have purchased lands:-If a tenant holds land partly as owner and partly as tenant but thearea of the land held as owner is equal to or exceeds the ceilingarea, he shall not be deemed to have purchased the land held byhim as a tenant under section 32.

32F. Right of tenant to purchase where landlord is minor etc. –

(1) Notwithstanding anything contained in the preceding sections,- (a) where the landlord is a minor or a widow, or a personsubject to any mental or physical disability the tenant shallhave the right to purchase such land under section 32 withinone year from the expiry of the period during which suchlandlord is entitled to terminate the tenancy under section31:

Provided that were a person of such category is a memberof a joint family, the provisions of this sub-section shall not apply ifat least one member of the joint family is outside the categoriesmentioned in this sub-section unless before the 31st day of March A

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1958 the share of such person in the joint family has been separatedby metes and bounds and the Mamlatdar on inquiry is satisfiedthat the share of such person in the land is separated, havingregard to the area, assessment, classification and value of theland, in the same proportion, as the share of that person in theentire joint family property, and not in a larger proportion.

(b) where the tenant is a minor, or a widow or a person subjectto any mental or physical disability or a serving member ofthe armed forces, then subject to the provisions of clause(a), the right to purchase land under section 32 may beexercised-

(i) by the minor within one year from the date on whichhe attains majority;

(ii) by the successor-in-title of the widow within one yearfrom the date on which her interest in the land ceasesto exist;

(iii) within one year from the date on which the mental orphysical disability of the tenant ceases to exist;

(iv) within one year from the date on which the tenantceases to be serving member of the armed forces; Provided that where a person of such category is a memberof a joint family, the provisions of this sub-section shall not apply ifat least one member of the joint family is outside the categoriesmentioned in this sub-section unless before the 31st day of March,1958 the share of such person in the joint family has been separatedby metes and bounds and the Mamlatdar on inquiry is satisfiedthat the share of such person in the land is separated, havingregard to the area, assessment, classification and value of theland, in the same proportion as the share of that person in theentire joint family property, and not in a larger proportion.

(1A) On and after the date of commencement of the BombayTenancy and Agricultural Lands (Gujarat Amendment) Act, 1960(Gujarat XVI of 1960) (hereinafter referred to in this sub-sectionas “the said date”), every tenant who has not exercised his rightof purchase within the period of one year within which it may beexercised under sub-section (1) shall, if the said period has commenced be deemed to have been purchased the land on thesaid date, whether the period has expired or not; and if the periodhas not commenced, he shall be deemed to have purchased theland on the date on which the period would have commenced butfor the provisions of this sub-section.

(2) The provisions of sections 32 to 32E (both inclusive) andsections 32G, to 32R. (both inclusive), shall, so far as may beapplicable, apply to such purchase.

32H. Purchase price and its maxima:-

(1) Subject to the additions and deductions as provided insub-sections (1A) and 1(B), the purchase price shall be reckonedas follows, namely:–

(i) in the case of a permanent tenant who is cultivating the landpersonally the purchase price shall be the aggregate of thefollowing amounts, that is to say,–

(a) an amount equal to six times the rent of the land; (b) the amount of the arrears of rent, if any, lawfully due onthe tillers’ day or the postponed date;

(c) the amounts, if any, paid by or recovered from thelandlord as land revenue and cesses referred to in clauses(a), (b), (c) and (d) of sub-section (1) of section 10A, inthe event of the failure on the part of the tenant to paythe same;

(ii) in the case of other tenants, the purchase price shall be theaggregate of the following amounts, that is to say:–

(a) such amount as the Tribunal may determine not beingless than 20 times the assessment and not more than200 times the assessment.

(b) the value of any structures, wells and embankmentsconstructed and other permanent fixtures made and treesplanted by the landlord on the land;

(c) the amount of the arrears of rent, if any, lawfully due onthe tillers’ day or the postponed date; A

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(d) the amounts, if any, paid by or recovered from thelandlord as land revenue and other cesses referred to inclauses (a), (b), (c) and (d) of sub-section (1) of section10A, in the event of the failure on the part of the tenantto pay the same.

Explanation 1.– For the purposes of calculating the price underthis subsection, the amount of water rate, if any, levied undersection 55 of the Bombay Land Revenue Code, 1879, and includedin such assessment, shall be excluded.

Explanation 2.– For the purposes of this sub-section, the expression“assessment” shall have the meaning assigned to it in section 8.

(1A) Where a tenant to whom sub-sections (1) and (2) of section10A do not apply, has, after the commencement of the BombayTenancy and Agricultural Lands (Amendment) Act, 1955, paid inrespect of the land held by him as tenant land revenue and othercesses referred to in sub-section (1) of that section, on account ofthe failure of the landlord to pay the same, a sum equal to the totalamount so paid by the tenant until the date of the determination ofthe purchase price shall be deducted from the aggregate of theamounts determined under sub-section (1).

(1B) (a) On the amount arrived at in accordance with theprovisions of sub-sections (1) and (1A), there shall be calculatedinterest at 4½ per cent. per annum for the period between thedate on which the tenant is deemed to have purchased the landunder section 32 and the date of the determination of the purchaseprice.

(b) (i) The amount of interest so calculated shall be added to,and

(ii) the amount of rent, if any, paid by the tenant to the landlordand the value of any products of trees planted by thelandlord if such products are removed by the landlord duringthe said period shall be deducted from, the amount so arrivedat.

(2) The State Government may, by general or special order, fixdifferent minima and maxima for the purpose of sub-clause (a) ofclause (ii) of sub-section (1) in respect of any kind of land held by tenants in any backward area. In fixing such minima and maxima,the State Government shall have regard to the rent payable forthe land and the factors specified in sub-section (3) of Section63A.

32I. Sub-tenant of permanent tenant to be deemed to havepurchased land. –

(1) Where a permanent tenant has sub-let the land held by him,the sub-tenant shall, to the extent and subject to the conditionsspecified in sections 32 to 32E (both inclusive), be deemed tohave purchased the land on the tillers’ day.

(2) The purchase price thereof shall be determined in the mannerprovided in clause (ii) of sub-section (1) of section 32H.

(3) Out of the purchase price of the payable by such sub-tenantthe amount equal to six times the rent shall, in lump sum, be payableto the owner and the balance shall be paid to the permanent tenant.

(4) The provisions of sections 32 to 32H (both inclusive) andsections 32J to 32R (both inclusive), in so far as they may beapplicable, shall apply to the purchase of the land by such sub-tenant and the payment to be made, to and on behalf, of thepermanent tenant.

32O[3]. Right of tenant whose tenancy is created after tillers’day to purchase land. –

(1) In respect of any tenancy created after the tillers’ daynotwithstanding any agreement or usage to the contrary, a tenantcultivating personally shall be deemed to have purchased on the date of expiry of one year from the commencement of suchtenancy from the landlord the land held by him or such part thereofas will raise the holding of the tenant to the ceiling area.

(2) The provisions of sections 32 to 32N (both inclusive) and ofsections 32P, 32Q and 32R in so far as they may be applicableshall apply to the purchase of the land by a tenant undersub-section (1).

3 Section 32O was deleted by Guj. Act No.10 of 2009

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A32P. Power of Collector to resume and dispose of land notpurchased by tenant and appeal against Collector’sorder: -

(1) Where the purchase of any land by tenant under section 32becomes ineffective under the foregoing provisions of thissub-chapter or where the tenant fails to exercise the right topurchase land under section 43-1D within the period specified inthat section the Collector may suo motu or on an application madein this behalf and after holding a formal inquiry direct that the landshall be disposed of in the manner provided in sub-section (2).

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(2) Such direction shall, subject to the provisions of sub-sections(2AA) and (2A) provide C

(a) that the tenancy in respect of the shall be terminated andthe tenant be summarily evicted:

(b) Clause (b) deleted by Guj. Act No.5 of 1973

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(c) that the entire land or such portion thereof, as the casemay be, notwithstanding that it is a fragment, shall subjectto the terms and conditions as may be specified in thedirection be disposed of by sale to person in the followingorder of priority (hereinafter called “the priority list”) :- E

and conditions as may be specified in the direction be disposed ofby sale to person in the following order of priority (hereinaftercalled “the priority list”):- (a-i) the tenant whose tenancy in respect of that land isterminated if such tenant is willing to accept the offer of sale,Fprovided the occasion for the issue of such direction has notarisen by reason of an act of collusion between such tenantand the landlord

(i) a co-operative farming society, the members of whichare agricultural labourers, landless persons or smallGholders or a combination of such persons;

(ii) agricultural labourers;

(iii) landless persons;

(iv) small holders;

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(v) a co-operative farming society of agriculturists (otherthan small holders) who hold either as owner or tenantor partly as owner and partly as tenant, land less in areathan an economic holding and who are artisans:

(vi) an agriculturist (other than a small holder) who holdseither as owner or tenant or partly owner and partly astenant, land les in area than an economic holding andwho is an artisan;

(vii) an other co-operative farming society;

(viii) any agriculturist who holds either as owner or tenant orpartly as owner and partly as tenant land larger in areathan an economic holding but less in area than the ceilingarea;

(ix) any person not being an agriculturist, who intends to taketo the profession of agriculture:

Provided that the State Government may, by notification inthe Official Gazette, give, in relation to such local areas as it mayspecify, such priority in the above order as it thinks fit to any classof persons who, by reason of the acquisition of their land for anydevelopment project approved for the purpose by the StateGovernment, have been displaced, and require to be re-settled; Provided further that- (a) where there are two or more co-operative farming societiesfalling under item, (i), (v) or (vii), preference amongst themshall be given in the following order, namely:-

(1) a co-operative farming society each of the members ofwhich belongs to a Scheduled Tribe;

(2) a co-operative farming society the membership of whichis held partly by persons belonging to a Schedule Tribaland partly by persons belonging to a Schedule Caste;

(3) a co-operative farming society each of the members ofwhich belongs to a Scheduled caste;

(4) a co-operative farming society the membership of whichis not solely held by persons belonging to a Schedule Tribeor Schedule Caste; A

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A(b)in the case of persons falling under items (ii), (iii) and (iv)preference shall be given in the following order, namely:-

(1) a person belonging to a Schedule Tribe;

(2) a person belonging to a Schedule Caste;

(3) other persons

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(2AA) Where in any case the direction under sub-section (2)provides that the land in respect of which the tenancy is terminatedshall be disposed of by sale to the tenant referred to in sub-clause(a-I) of clause (c) of sub-section (2), the tenant shall be liable tobe evicted only if the land or, as the case may be, the portionthereof could not be disposed of by sale to him.

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(2A) Where the tenancy in respect of any land is terminated underclause (a) of sub-section (2) but the tenant of such land is aco-operative farming society of the type referred to in sub-clauseD(i) of clause (c) of sub-section (2), the direction under sub-section,the direction under sub-section (2) shall further provide-

(i) that the entire land or such portion thereof, as the casemay be, shall be disposed of by sale to the co-operativefarming society which was the tenant of the land or as thecase may be, portion thereof immediately before thetermination of the tenancy under clause (a) of sub-section(2).

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Provided that the total acreage of the land to be so disposedof shall not exceed an area arrived at by multiplying the ceilingarea by the total number of the members of the co-operativeFfarming society;

(ii) that on the termination of the tenancy under clause (a) ofsub-section (2), the co-operative farming society shall beliable to be evicted only from such portion of the land ascould not be disposed of by sale to it under a directionissued under sub-section (2).

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(3) [Omitted by Gujarat Act No.5 of 1973]

(4) Where the land or portion thereof is offered for sale undersub-section (2) but no person comes forward to purchase suchland or portion, such land or portion, as the case may be, shall vest H

in the State Government and the Collector shall determine theprice of such land or portion in accordance with the provisions ofsection 63A and the amount of the price so determined shall, subjectto the provisions of section 32Q, be paid to the owner thereof.

(5) Where any land is sold under sub-section (2), the Collectorshall determine the price of the land in accordance with theprovisions of section 63A and the price so determined shall bepayable by annual instalments not exceeding six with simpleinterest at the rate of 4½ per cent, per annum as the Collectormay determine and the price of the land recovered from thepurchaser shall, subject to the provisions of section 32Q, be paidto the owner thereof.

(6) On the payment of the last instalment of the price, togetherwith the interest due, the Collector shall issue a certificate ofpurchase in the prescribed form to the purchaser in respect of theland. Such certificate shall be conclusive evidence of purchase.

(7) (a) Where before the specified date, any land has beensurrendered to a landlord under sub-section (2) of this section asin force immediately before such date; and the landlord has takenpossession of the land, the landlord shall be liable to cultivate theland personally and shall be entitled to the use and occupation ofthe land so long as he cultivates the land personally.

(b) If he fails to so cultivate the land he shall be evictedfrom the land and the land shall be disposed of in accordance withthe provisions of section 84C.

(8) No land of the description referred to in sub-section (7) shallbe transferred by sale, gift, exchange, mortgage, lease, orassignment or partitioned without the previous sanction of theCollector and except on payment of such amount as the StateGovernment may by general or special order determine.

(9) Any person aggrieved by any order made by the Collectorunder the foregoing provisions of this section may appeal to theState Government against such order.

(10) The State Government shall after giving an opportunity tothe parties to be heard, decide the appeal.

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928SUPREME COURT REPORTS

A(11) The order of the Collector, subject to such appeal and decisionof the State Government on appeal, shall be final.

32PP. Further opportunity to tenant to purchase land.-

(1) Notwithstanding anything contained in section 32G and 32Pwhere before the date of the coming into force of the BombayBTenancy and Agricultural Lands (Gujarat Amendment) Act, 1965(Guj. 36 of 1965), (hereinafter referred to in this section as “thesaid date”)–

(i) any land has been at the disposal of the Collector undersection 32P on account of the purchase of the land by thetenant thereof having become ineffective undersub-section (3) of section 32G by reason of the tenantfailing to appear before the Tribunal or making a statementexpressing his unwillingness to purchase the land, and C

(ii) the land so at the disposal of the Collector has not beendisposed of in the manner provided in sub-section (2) ofsection 32P.

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the tenant, if he is willing to purchase the land may an applicationin writing to the Tribunal within a period of one year from the saiddate for a declaration that the purchase has not become ineffective.

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(1A) Notwithstanding the expiry of the period specified insub-section (1), the right conferred under that sub-section, maybe exercised as if in that sub-section, for the words, brackets andfigures “the Bombay Tenancy and Agricultural Lands (GujaratAmendment) Act, 1965” (Guj. 36 of 1965), the words, bracketsand figures “the Bombay Tenancy and Agricultural Lands (GujaratAmendment) Act, 1970” were substituted.

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(1B) Where an application for a declaration that the purchase hasnot become ineffective made by a tenant under sub-section (1)before the commencement of the Bombay Tenancy andAgricultural Lands (Gujarat Amendment) Act, 1970 (Guj. 2 of1971), was not admitted by the Tribunal on the ground that theperiod for making it had expired, such tenant shall also be entitledto exercise the right conferred under sub-section (1) by makingan application within the period specified in that sub-section (1)by making an application from any such tenant the Tribunal shall G

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admit it as if it were an application made within such specifiedperiod.

(1C) Notwithstanding the expiry of the period specified insub-section (1) read with sub-section (1A), the right conferredunder sub-section (1) may be exercised.

(a) by a tenant at any time before two months after thecommencement of the Bombay Tenancy and AgriculturalLands (Gujarat Amendment) Act, 1981 (Guj.13 of 1981);or (b) by a specified tenant at any time before the date specifiedunder clause (b) of sub-section (5) of section 32M.

(1D) Where an application for a declaration that the purchasehas not become ineffective made by a tenant under sub-section(1) before the specified date was not admitted by the Tribunal onthe ground that the period for making it had expired.

(a) such tenant shall also be entitled to exercise the rightconferred under sub-section (1) by making an applicationat any time before two months after the commencementof the Bombay Tenancy and Agricultural Lands (GujaratAmendment) Act, 1981 (Guj. 13 of 1981); or (b) such tenant being a specified tenant shall also be entitledto exercise the right conferred in sub-section (1) by makingan application at any time before the date specified underclause (b) of sub-section (5) of section 32M

and on receipt of an application from any such tenant or specifiedtenant the Tribunal shall admit it as if it were an application madewithin the period specified for making it.

(2) On receipt of an application under sub-section (1) the Tribunalshall issue a notice to the tenant and the landlord calling uponthem to appear before it on the date specified in the notice.

(3) If the tenant appears and makes a statement that he is willingto purchase the land, the land shall cease to be at the disposal ofthe Collector under section 32P and the Tribunal shall determinethe purchase price of the land in the manner provided in section32G as if the purchase had not been ineffective.

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(4) The provisions of section 32 to 32P and sections 32-Q and32R shall so far as may be applicable apply to the purchase of theland by a tenant under this section.

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(5) In the case of land to which this section applies no action shallbe taken under section 32P unless the tenant entitled to make anapplication under this section fails to make such application withinthe period specified in sub-section (1).

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Explanation.—Notwithstanding anything contained in anyjudgment, decree or order of any court, tribunal or other authority,for the purpose of clause (ii) of sub-section (1), the land shall notbe deemed to have been disposed of till the person entitled to takepossession of the land in pursuance of any direction the personentitled to take possession of the land in pursuance of any directionissued under sub-section (2) of section 32P takes actual possessionof such land in accordance with law.

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D32PPP. Further opportunity to purchase land to tenantswhose purchase become ineffective after commencementof Guj.36 of 1965.-

(1) Notwithstanding anything contained in sections 32G and 32Pwhere on or after the date of the coming into force of the BombayTenancy and Agricultural Lands (Gujarat Amendment) Act, 1965(Guj. 36 of 1965),—

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(i) any land has been at the disposal of the Collector undersection 32P on account of the purchase of the land by thetenant thereof having become ineffective undersub-section (2) of section-32G by reason of the tenantfailing to appear before the Tribunal or making a statementexpressing his unwillingness to purchase the land, and F

(ii) the land so at the disposal of the Collector has not beendisposed of in the manner provided in sub-section (2) ofsection 32P—

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(a) the tenant, if he is willing to purchase the land maymake an application in writing to the Tribunal beforetwo months after the commencement of the BombayTenancy and Agricultural Lands (GujaratAmendment) Act, 1981; or H

(b) the tenant, if he is a specified tenant and is willing topurchase the land, may make an application in writingto the Tribunal before the data specified under clause(b) of sub-section (5) of section 32M

for a declaration that the purchase has not been ineffective.

(2) On receipt of an application under sub-section (1) the Tribunalshall issue a notice to the tenant and the landlord calling uponthem to appear before it on the date specified in the notice.

(3) If the tenant appears and makes a statement that he is willingto purchase the land, the land shall cease to be at the disposal ofthe Collector under section 32P and the Tribunal shall determinethe purchase price of the land in the manner provided in section32G as if the purchase has not been ineffective.

(4) The provisions of sections 32 to 32P and sections 32Q and32R shall so far as may be applicable apply to the purchase of theland by a tenant under this section.

(5) In the case of land to which this section applies no action shallbe taken under section 32P unless the tenant entitled to make anapplication under this section fails to make such application withinthe period specified in sub-section (1).

Explanation.—Notwithstanding anything contained in anyjudgement, decree or order of any court, tribunal or other authorityfor the purpose of clause (ii) of sub-section (1), the land shall notbe deemed to have been disposed of till the person entitled to takepossession of the land in pursuance of any direction issued undersub-section (2) of section 32P takes actual possession of suchland in accordance with law.

32QQ. Deposit or payment of purchase price by StateGovernment on behalf of specified tenant.-

(1) (a) Where a specified tenant permitted under clause (b) ofsubsection (5) of section 32M to deposit with the Tribunal at anytime before the date specified under clause (b) of sub-section (5)of section 32M the entire amount of the price of the land or, as thecase may be, the unpaid portion of the price, together with theinterest, as specified in sub-section (3) and (4) of section 32M,has failed to deposit with the Tribunal such amount before the A

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date of the commencement of the Bombay Tenancy andAgricultural Lands (Gujarat Second Amendment) Ordinance, 1986(Guj. Ord. 14 of 1986), (hereinafter referred to as “the said date”),the State Government shall, notwithstanding the expiry of the periodspecified in clause (b) of sub-section (5) of section 32M, depositon behalf of such specified tenant, with the Tribunal within a periodof twelve months from the said date such amount, and on depositingsuch amount with the Tribunal, the purchase of land shall bedeemed not to have become ineffective and the Tribunal shallissue a certificate of purchase to the specified tenant undersub-section (1) of section 32M.

(b) Where a specified tenant permitted under clause (b) ofsub-section (1C) or clause (b) of sub-section (1D) of section 32PPor under sub-clause (b) of clause (ii) of sub-section (1) of section32PPP to make at any time before the date specified under clause(b) of sub-section (5) of section 32M an application undersub-section (1) of section 32PP for a declaration that purchasehas not become ineffective, fails to make such application beforethe date specified under clause (b) of sub-section (5) of Section32M, and the Collector directs under sub-section (2) of section32P that the land in respect of which the tenancy is terminatedshall be disposed of by sale to the specified tenant who is a tenantreferred to in sub-clause (a-i) of clause (c) of the said sub-section(2) and the land is disposed of by sale to such specified tenant, theCollector shall issue a certificate of purchase in the form prescribedunder sub-section (1) of section 32M to such specified tenantwho shall be liable to pay to the Collector the price of such landdetermined by the Collector under sub-section (5) of section 32P.

(2) The amount deposited with the Tribunal under clause (a) ofsub-section (1) or, as the case may be, the amount of price of landwhich the specified tenant is liable to pay to the Collector underclause (b) of sub-section (1) shall be deemed to be the amount ofloan granted to the specified tenant by the State Government onsuch terms and conditions as may be prescribed and the amountof loan and interest or any portion thereof shall be recoverablefrom such specified tenant as arrears of land revenue.

32R. Purchaser to be evicted if he fails to cultivatepersonally:- If at any time after the purchase of the land under any of the foregoing provisions, the purchaser fails to cultivatethe land personally, he shall unless the Collector condones suchfailure for sufficient reasons, be evicted and the land shall bedisposed of in accordance with the provisions of section 84C.

32U. Tenants of lands mentioned in section 88C to bedeemed to have purchased land and other incidentalprovisions. - (1) Notwithstanding anything contained insub-section (1) of section 88C, but subject to the provisions of thissection every excluded tenant holding land from a certified landlordshall, except as otherwise provided in sub-section (3), be deemedto have purchased from the landlord on the first day of April 1962,free from all encumbrances subsisting thereon on the said day,the land hold by him as tenant, if such land is cultivated by himpersonally; and

(i) the landlord has not given notice of termination of tenancyin accordance with sub-section (3) of section 32T, or

(ii) the landlord has given such notice but has not made anapplication thereafter under section 29 for possession asrequired by the said sub-section (3), or

(iii) the landlord not being a person of any of the categoriesspecified in sub-section (4) of section 32T has notterminated the tenancy on any of the grounds specified insection 14 or has so terminated the tenancy but has notapplied to the Mamlatdar on or before the 31st day ofMarch 1962 under section 29 for possession of the land; Provided that where the landlord has made such applicationfor possession but it is rejected by the Mamlatdar or in appeal bythe Collector or in revision by the Gujarat Revenue Tribunal underthe provisions of this Act the tenant shall be deemed to havepurchased the land on the date on which the final order of rejectionis passed.

(2) (a) Where a tenant, on account of his eviction from the landby the landlord, before the 1st April, 1962, is not in possession ofthe land on the said date but has made or makes an application forpossession of the land under sub-section (1) of section 29 withinthe period specified in that sub-section, then if the application is A

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allowed by the Mamlatdar, or as the case may be, in appeal by theCollector or in revision by the Gujarat Revenue Tribunal, he shallbe deemed to have purchased the land on the date on which thefinal order allowing the application is passed.

(b) Where such tenant has not made an application forpossession within the period specified in sub-section (1) of section29 or the application made by him is finally rejected under thisAct, and the land is held by any other person as tenant on theexpiry of the said period or on the date of the final rejection of theapplication, such other person shall be deemed to have purchasedthe land on the date of the expiry of the said period or, as the casemay be, on the date of the final rejection of the application.

(3) Where the certified landlord being a person of any of thecategories specified in sub-section (4) of section 32T has not givennotice of termination of the tenancy of an excluded tenant inaccordance with sub-section (3) of that section or has give suchnotice but has not made an application thereafter under section29 for possession as required by the said sub-section (3) suchexcluded tenant shall be deemed to have purchased the land heldby him as tenant on the expiry of the period specified insub-section (4) of section 32T:

Provided that where the tenancy is terminated andapplication for possession is made in accordance with the provisionsof sub-section (4) of section 32T but the application is rejected bythe Mamlatdar or in appeal by the Collector or in revision by theGujarat Revenue Tribunal, the tenant shall be deemed to havepurchased the land on the date on which the final order of rejectionis passed.

(4) The provisions of section 32 to 32R shall so far as may beapplicable apply to the purchase of land under this section by anexcluded tenant.

33. Right of tenants to exchange land. –

(1) Notwithstanding anything contained in this Act or any otherlaw or any agreement or usage, the tenants holding lands assuch tenants may agree and may make an application to theMamlatdar in the prescribed form for the exchange of theirtenancies in respect of the lands held by them as tenants.

(2) On receipt of the application, the Mamlatdar after giving noticeto the landlords concerned and after making an inquiry maysanction the exchange on such terms and conditions as may beprescribed and may issue certificate in the prescribed form to theapplications.

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(3) The certificate so issued shall be conclusive of the fact ofsuch exchange against the landlords and all persons interested inthe lands exchanged B

(4) Each of the two tenants shall on exchange hold the land onsame terms and conditions on which it was held by the originaltenant immediately before the exchange subject to suchmodifications as may have been sanctioned by the Mamlatdar.

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63A. Reasonable price of land for the purpose of its sale-and purchase.

(1) Except as otherwise expressly provided in this Act, the priceof any land sold or purchased under the provisions of this Actshall consist of the following amounts, namely :–

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(a) an amount not being less than 20 times the assessmentlevied or leviable in respect of the land and not being morethan 200 times such assessment excluding, however, forthe purpose of calculation, the amount of water rate, ifany, levied under section 55 of the Bombay Land RevenueCode, 1879 (Bom. V of 1879), and included in suchassessment; E

(b) the value of any structures, wells and embankmentsconstructed, permanent fixtures made and trees plantedFon the land.

(2) Where under the provisions of this Act any land is sold orpurchased by mutual agreement, such agreement shall beregistered before the Mamlatdar, and the price of the land shall, subject to the limits specified in sub-section (1), be such as maybe mutually agreed upon by the parties. In the case of disagreementbetween the parties, the price shall be determined by the Tribunalhaving regard to the factors mentioned in this section.

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(3) Where in the case of a sale or purchase of any land under thisAct, the Tribunal or the Mamlatdar has to fix the price of such H

Aland under this Act, the Tribunal or the Mamlatdar, as the casemay be, shall, subject to the quantum specified in sub-section (1),fix the price having regard to the following factors, (a) the rental values of lands used for similar purposes in thelocality; B

(b) the structures and wells constructed and permanent fixturesmade and trees planted, on the land by the landlord ortenant;

(c) the profits of agriculture of similar lands in the locality; (d) the prices of crops and commodities in the locality; C

(e) the improvements made in the land by the landlord or thetenant; (f) the assessment payable in respect of the land; (g) such other factors as may be prescribed; D

Explanation.– For the purposes of this section the expression“assessment” shall have the meaning assigned to it in section 8.

64. Sale of agricultural land to particular person. –

(1) Where a landlord intends to sell any land, he shall apply to theETribunal for determining the reasonable price thereof. The Tribunalshall thereupon determine reasonable price of the land inaccordance with the provisions of section 63A. The Tribunal shallalso direct that the price shall be payable either in lump sum, or inannual instalments not exceeding six carrying simple interest atF4½ per cent per annum:

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Provided that in the case of sale of the land in favour of apermanent tenant when he is in possession thereof, the price shallbe at six times the annual rent.

(2) After the Tribunal has determined the reasonable price, theGlandlord shall simultaneously in the prescribed manner make aoffer:- (a) in the case of agricultural land-

(i) to the tenant in actual possession thereof,notwithstanding the fact that such land is a fragment,and H

(ii) to all persons and bodies mentioned in the proprietyAlist; (b) in the case of a dwelling house, or a site of a dwellinghouse or land appurtenant to such house when suchdwelling house, side or land is not used or is notnecessary to carry on agricultural operations in theadjoining lands- B

(i) to the tenant thereof:

(ii) to the person residing in the village who is not inpossession of any dwelling house; C

Provided that if there are more than one such person the offershall be made to such person or persons and in such order ofpriority as the Collector may determine in this behalf having regardto the needs of the following persons, namely:-

(i) an agricultural labourer,

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(ii) an artisan,

(iii) a person carrying on an allied pursuit,

(iv) any other person in the village.

(3) The persons to whom such offers are made shall intimate tothe landlord within one month from the date of receipt of the offerwhether they are willing to purchase the land at the price fixed bythe Tribunal.

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(4) (a) If only one person intimates to the landlord undersub-section (3) his willingness to accept the offer made to him bythe landlord under sub-section (2), the landlord shall call uponsuch person by a notice in writing in the prescribed form to payhim the amount of the reasonable price determined by the Tribunalor to deposit the same with Tribunal within one month or suchfurther period as the landlord may consider reasonable from thedate of receipt of the notice by such person.

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(b) If more than one person intimates to the landlord undersub-section (3) their willingness to accept the offers made to themby the landlord under sub-section (2), the landlord shall call uponby a notice in writing in the prescribed form and the person having H

the highest priority in the order of priority given in sub-section (2)to pay him the amount of the reasonable price determined by theTribunal or to deposit the same with Tribunal within one month orsuch further period as the landlord may consider reasonable fromthe date of receipt of the notice by such person.

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(5) If the person to whom a notice is given by the landlord undersub-section (4) fails to pay the amount of the reasonable price tothe landlord or to deposit the same with the Tribunal within theperiod referred to in sub-section (4) such person shall be deemedto be not willing to purchase the land and the landlord shall callupon in the manner provided in sub-section (4) the person whostands next highest in the order of priority and who has intimatedhis willingness to the landlord under sub-section (3).

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(6) If any dispute arises under this section regarding- (a) the offer made by the landlord under sub-section (2), or D

(b) the notice given by the landlord under sub-section (4) or(5), or

(c) the payment or deposit of the reasonable price, or (d) the execution of the sale deed, such dispute shall be decidedby the Tribunal.

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(7) (a) Notwithstanding anything contained in the foregoingprovisions of this section a landlord may after obtaining the previouspermission of the Tribunal as provided in the next succeeding clause(b) sell any land notwithstanding the fact that such land is afragment to the tenant in actual possession thereof at a priceFmutually agreed upon between him and the tenant subject to theprovisions of section 63A.

(b) The landlord shall make an application in writing to theTribunal for permission to sell the land at such price. On receiptof the application, the Tribunal shall grant the permission if, onholding an inquiry, it is satisfied that the price has been agreed tovoluntarily by the tenant.

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(8) Any sale made in contravention of this section shall be invalid.

(9) If a tenant refuses or fails to purchase the land or a dwellinghouse offered to him under this section, and the land or the dwelling H

house, as the case may be, is sold to any other person under thissection, the landlord shall be entitled to evict such tenant and putthe purchaser in possession.

84C. Disposal of land, transfer or acquisition of which isinvalid.-

(1) Where in respect of the transfer or acquisition of any landmade on or after the commencement of the Amending Act, 1955,the Mamlatdar suo motu or on the application of any personinterested in such land has reason to believe that such transfer oracquisition is or becomes invalid under any of the provisions ofthis Act, the Mamlatdar shall issue a notice and hold any inquiryas provided for in section 84B and decide whether the transfer oracquisition is or is not invalid.

(2) If after holding such inquiry, the Mamlatdar comes to aconclusion that the transfer or acquisition of land to be invalid, heshall make an order declaring the transfer or acquisition to beinvalid, unless the parties to such transfer or acquisition give anundertaking in writing that within a period of three months fromsuch date as the Mamlatdar may fix, they shall restore the landalongwith the rights and interest therein to the position in which itwas immediately before the transfer or acquisition, and the land isso restored within that period:

Provided that where the transfer of land was made by thelandlord to the tenant of the land and the area of the land sotransferred together with the area of other land, if any, cultivatedpersonally by the tenant did not exceed the ceiling area, theMamlatdar shall not declare such transfer to be invalid-

(i) if the amount received by the landlord as the price of theland is equal to or less than the reasonable price determinedundersection 63A and the transferee pays to the StateGovernment a penalty equal to Re.1 within such periodnot exceeding three months as the Mamlatdar may fix;

(ii) if the amount received by the landlord as the price of theland is in excess of the reasonable price determined undersection 63A and the transferor as well as the transfereepays to the State Government each a penalty equal to one- A

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tenth of the reasonable price within such period as may befixed by the Mamlatdar.

(3) On the declaration made by the Mamlatdar under sub-section(2),—

(a) the land shall be deemed to vest in the State Government,free from all encumbrances lawfully subsisting thereon onthe date of such vesting and shall be disposed of in themanner provided in sub-section (4); the encumbrances shallbe paid out of the occupancy price in the manner providedin section 32Q for the payment of encumbrances out ofthe purchase price of the sale of land but the right of theholder of such encumbrances to proceed against the personliable, for the enforcement of his right in any other manner,shall not be affected; (b) the amount which was received by transferor as the priceof the land shall be deemed to have been forfeited to theState Government and it shall be recoverable as an arrearof land revenue; and

(c) the Mamlatdar shall, in accordance with the provisions ofsection 63A determine the reasonable price of the land.

(4) After determining the reasonable price, the Mamlatdar shallgrant the land on new and impartible tenure and on payment ofoccupancy price equal to the reasonable price determined undersub-section (3) in the prescribed manner in the following order ofpriority:—

(i) the tenant in actual possession of the land;

(ii) the persons or bodies in the order given in the priority list:

Provided that where the transfer of land was made by the landlordto the tenant of the land and area of the land so transferred togetherwith the area of the land, if any, cultivated personally by the tenantdid not exceed the ceiling area then—

(i) if the amount received by the transferor as the price ofthe land is equal to or less than the reasonable price, theamount forfeited under sub-section (3) shall be returnedto the transferor and the land restored to the transferee onpayment of a penalty of rupee one in each case; and

(ii) if the amount received by the transferor as the price ofthe land is in excess of the reasonable price, the Mamlatdarshall grant the land to the transferee on new and impartibletenure and on payment of occupancy price equal to one-tenth of the reasonable price and out of the amount forfeitedunder sub-section (3), the transferor shall be paid back anamount equal to nine-tenths of the reasonable price.

(5) The amount of the occupancy price realised under sub-section(4) shall subject to the payment as aforesaid of any encumbrancessubsisting on the land, be credited to the State Government:

Provided that where the acquisition of any excess land wason account of a gift or bequest, the amount of the occupancyprice realised under sub-section (4) in respect of such land shall,subject to the payment of any encumbrances subsisting thereon,be paid to the done or legatee in whose possession the land hadpassed on account of such acquisition.

Explanation.—For any purposes of this section “new andimpartible tenure” means the tenure of occupancy which isnon-transferable and non-partible without the previous sanctionof the Collector.

88B. Exemption from certain provisions to and of localauthorizes, universities and trusts.-

(1) Nothing in the foregoing provisions, except sections 3, 4B, 8,9, 9A, 9B, 9C, 10, 10A, 11, 13 and 27 and the provisions of ChaptersVI and VIII in so far as the provisions of the said Chapters areapplicable to any of the matters referred to in the sectionsmentioned above, shall apply—

(a) to lands held or leased by a University established by lawin the [Bombay area of the state of Gujarat; and (b) to lands which are the property of a trust for an educationalpurpose a hospital, Punjarapol. or Gaushala;

(c) to lands assigned or donated by any person before the 1[st]day of August, 1956, for the purpose of rendering any ofthe following services useful to the community, namely:—

maintenance of water works, lighting or filling of water throughsfor cattle:

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Provided that —

(i) such trust is or is deemed to be registered under theBombay Public Trusts Act, 1950 (Bom. XXIX of 1950),and

(ii) the entire income of such land is appropriated for thepurposes of such trust.

(2) For the purposes of this section a certificate granted by theCollector, after holding an inquiry, that the conditions in the provisoto sub-section (1) are satisfied by any trust shall be conclusiveevidence in that behalf.

(3) Notwithstanding anything contained in sub-section (1), nothingin the foregoing provisions of this Act shall apply to lands leasedfor cultivation with the help of sewage, whether before or afterthe commencement of the Amending Act, 1955 by a local authorityin discharge of its duties and functions relating to the establishmentand maintenance of a farm for the disposal of sewage under thelaw under which such local authority is constituted.

88E. Cessor of exemption in respect of certain public trustlands. –

(1) Notwithstanding anything contained in section 88B, with effecton and from the specified date, lands which are the property of aninstitution for public religious worship shall cease to be exemptedfrom those provisions of the Act except sections 31 to 31D (bothinclusive) from which they were exempted under section 88Band all certificates granted under that section in respect of suchlands shall stand revoked.

(2) Where any such land ceases to be so exempted, then in thecase of a tenancy subsisting immediately before the specified datethe tenant shall be deemed to have purchased the land on thespecified date and the provisions of sections 32 to 32R (bothinclusive) shall so as far may be applicable, apply.

Exemption. - In this section “specified date” means thedate of the commencement of the Gujarat Devasthan InamsAbolition Act, 1969 (Gujarat 16 of 1969).”

5. The aforesaid provisions generally deal with the right ofpurchase conferred upon a tenant and process to effectuate said right of purchase. Following provisions, inter alia, deal with some of the incidentswhile the relationship as a tenant is in operation including assignment onpart of the tenant:- “14.Termination of tenancy for default of tenant :- (1)Notwithstanding any law, agreement or usage or the decree ororder of a court, the tenancy of any land shall not be terminated—

(a) unless the tenant—

(i) has failed to pay the rent for any revenue year beforethe 31st day of May thereof;

(ii) has done any act which is destructive or permanentlyinjurious to the land;

(iii) has sub-divided, sub-let or assigned, the land incontravention of section 27;

(iv) has failed to cultivate it personally; or

(v) has used such land for a purpose other thanagriculture or allied pursuits; and (b) unless the landlord has given three months’ notice in writinginforming the tenant of his decision to terminate the tenancy andthe ground for such termination, and within that period the tenanthas failed to remedy the breach for which the tenancy is liable tobe terminated.

(2) Nothing in sub-section (1) shall apply to the tenancy of anyland held by a permanent tenant unless by the conditions of suchtenancy the tenancy is liable to be terminated on any of the groundsmentioned in the said sub-section.

27. Sub-division, sub-letting and assignment prohibited:-(1) Save as otherwise provided in section 32F no sub-division orsub-letting of the land held by a tenant or assignment of any interesttherein shall be valid:

Provided that nothing in this sub-section shall prejudicially affectthe rights of a permanent tenant:

Provided further that if the tenant dies:”

(i) if he is a member of a joint family, the survivingmembers of the said family, and A

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(ii) if he is not a member of a joint family, his heirs, shall be entitled to partition and sub-divide the landleased subject to the following conditions:- (a) each sharer shall hold his share as a separate tenant.

(b) the rent payable in respect of the land leased shallbe apportioned among the shares, as the case maybe, according to the share allotted to them.

(c) the area allotted to each sharer shall not be lessthan the unit which the State Government may, bygeneral or special order, specify in this behalf havingregard to the productive capacity and othercircumstances relevant to the full and efficient useof the land for agriculture.

(d) if such area is less than the unit referred to in clause(c), the sharers shall be entitled to enjoy the incomejointly, but the land shall not be divided by metesand bounds.

(e) if any question arises regarding the apportionmentof the rent payable by the sharers, it shall be decidedby the Mamlatdar, whose decision shall be final.

(2) Notwithstanding anything contained in sub-section (1), it shallbe lawful for a tenant:- (a) who is a widow, minor or a person subject to anyphysical or mental disability, or a serving memberof the armed forces, to sub-let such land held byher or him as a, tenant; or (b) Who is a member of a co-operative farming societyand as such member to sub-let, assign mortgage orto create a charge on his interest in the land in favourof such society, or in consideration of a loanadvanced by any person authorised under section54 of the Bombay Agricultural Debtors Relief Act,1947.

(3) Notwithstanding anything contained in sub-section (1), it shallalso be lawful for a tenant to mortgage or create a charge on his interest in the land in favour of the State Government inconsideration of a loan advanced to him by the State Governmentunder the Land Improvement Loans Act, 1883, the Agriculturists,Loans Act, 1884, or the Bombay Non-Agriculturists, Lands Act,1928, or in favour of a co-operative society in consideration of aloan advanced to him by such co-operative society, and withoutprejudice to any other remedy open to the State Government orthe co-operative society, as the case may be, in the event of hismaking default in payment of such loan in accordance with theterms on which such loan was granted, it shall be lawful for theState Government or the co-operative society, as the case maybe, to cause his interest in the land to be attached and sold and theproceeds to be applied in payment of such loan.”

6. The facts leading to the filing of Appeal arising out of SpecialLeave Petition (Civil) No.18525 of 2009, by way of illustration, are setout in detail as under:-

a) Agricultural land bearing Survey No.102 admeasuring 0.88hectares situated within the revenue limits of village Gabheni,Taluka Chorayasi, District Surat (‘said land’ for short) was inthe cultivating possession of one Samubhai Budhiabhai astenant. As part of agrarian reforms and in terms of theprovisions of the Act conferring right of statutory purchaseupon the tiller of the land, Samubhai became DeemedPurchaser as he was cultivating the land on the tillers’ day.

b) Samubhai executed a registered Will on 24.01.1991 in favourof Vinodchandra Sakarlal Kapadia, the Appellant hereinpurporting to bequeath the said land to the Appellant. Uponthe demise of Samubhai on 02.02.1991, vide mutation No.2141certified on 20.06.1991, the name of the Appellant came to berecorded in the revenue records as owner of the said land.

c) The Revenue Authorities however found that the Appellantwas not an agriculturist and accordingly proceedings underSection 84C of the Act were registered and notice was issuedto the Appellant. All the concerned parties appeared in theproceedings and the legal heirs of deceased Samubhaisubmitted that they had no objection if the land was given tothe Appellant in terms of the Will. After hearing the Appellant,the Additional Mamlatdar by his order dated 04.03.1996 in A

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ATenancy Case No. 78/95 found that the disposal by way of aWill in favour of the Appellant was invalid and contrary to theprinciples of Section 63 of the Act and therefore declared thatthe said land vested in the State without any encumbrances.

d) The order passed by the Additional Mamlatdar was affirmedBin Tenancy Appeal No.20/1996 by Deputy Collector, LandDevelopment, Surat, vide his order dated 15.07.1996. Thematter was carried further by way of Revision ApplicationNo.TEN.B.S.94 of 1996 before Gujarat Revenue Tribunal.Relying on certain decisions rendered by the High Court, theTribunal observed that disposal by way of a Will would notCamount to transfer and as such, it would not be hit by Section63 of the Act. The Tribunal thus allowed the Revision andquashed the orders passed by the Additional Mamlatdar andthe Deputy Collector.

e) The State, being aggrieved, preferred Special Civil ApplicationDNo.25058 of 2006 in the High Court which came up before aSingle Judge of the High Court. Relying on the decisions ofthis Court in Sangappa Kalyanappa Bangi (Dead) throughLRs. vs. Land Tribunal, Jamkhandi and others[4 ]and inJayamma vs. Maria Bai (Dead) by proposed LRs andEanother[5], the Single Judge referred the matter to the DivisionBench of the High Court for consideration.

7. Similar references were made in all other connected mattersraising identical issues, which were dealt with by the Division Bench ofthe High Court in its judgment and order presently under Appeal.

F8. The Division Bench considered the scope and ambit of Sections43 and 63 of the Act as under:- “We may, before examining the scope and ambit of Section 43and 63 of the Tenancy Act, examine the object and purpose of theTenancy Act. The Bombay Tenancy Act was enacted with anGavowed object of safeguarding interest of the tenants who heldthe land for over a number of years, on principle that the landtilled to the tillers of the soil and also to preserve agricultural landsto safeguard interest of the agriculturists. Object is also to improve 4 AIR 1998 SC 3229 = (1998) 7 SCC 294

H5 AIR 2004 SCW 4412 = (2004) 7 SCC 459

4 AIR 1998 SC 3229 = (1998) 7 SCC 294

H5 AIR 2004 SCW 4412 = (2004) 7 SCC 459

the economic and social conditions of peasants ensuring the fulland efficient use of land for agriculture, and to assumemanagement of estates held by landholders and to regulate andimpose restrictions on the transfer of agricultural lands, dwellinghouses, sites and lands appurtenant thereto belonging to or occupiedby agriculturists, agricultural labourers and artisans. Chapters IIand III of the Act deal with tenancies in general and ‘protectedtenants’ and their special rights, and privileges, in particular.Legislature also thought it necessary to confer on ‘protectedtenants’ the right to purchase their holdings from their landlords,to prevent uneconomic cultivation and to create and encouragepeasant proprietorship in respect of holdings of suitable sizes. TheAct is covered by Entry 18 in List II of the Seventh Schedule tothe Constitution of India and was enacted for the protection oftenants and to organise agriculture by maintaining agricultural landsso as to be in tune with the directive principles of the State Policy.Article 48 of the Constitution of India state that the State shallendeavour to organize agriculture and animal husbandry on modernand scientific lines, and shall, in particular, take steps for preservingand improving the breeds, and prohibiting the slaughter of cows,calves and other milch and drought cattle. The necessity of meetingagricultural production and to preserve agricultural land is clearlydiscernible in the above constitutional provisions. Further, byenacting clause (g) in Article 51(A), Parliament has given thestatus of fundamental duties to Article 48 and honoured the spiritand message of Article 48 as a fundamental duty of the citizens.The Bombay Tenancy Act not only takes a positive step towardsachieving the goal of transferring the land tilled to the tillers, butalso wanted to preserve and protect agricultural lands and forimproving the economic and social conditions of persons and toensure the full and efficient use of land for agriculture. Section43, which appears in Chapter III of the Tenancy Act, deals withspecial rights and privileges of tenants and provisions fordistribution of land for personal cultivation. Section 63 appears inChapter V of the Tenancy Act deals with restrictions on transfersof agricultural lands, management of uncultivated lands andacquisition of estates and lands.”

8.1 While dealing with the question whether the term ‘assignment’used in Section 43 of the Act would include ‘testamentary disposition’,it was observed by the Division Bench:- AB

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“Section 43 of the Tenancy Act, however, uses word ‘assignment’.Word ‘assignment’ has been given statutory meaning by the ApexCourt while examining the scope of Section 21 of the KarnatakaLand Reforms Act in Sangappa Kalyanappa Bangi[4]. In thatcase, one Sangappa Bangi made an application under Section 45of the Karnataka Land Reforms Act, 1961 claiming occupancyrights in respect of the land in question. During the pendency ofthe proceedings, he made a Will on 8.4.1975 bequeathing histenancy rights in respect of the land in favour of one Ameerjanwho claims to be the legal representative of the appellant-Sangappawho died during pendency of the proceedings before the Tribunal.She in turn executed another Will under which Husensab is makinga claim to the land through the said Sangappa. Land Tribunal aswell as Appellate Tribunal examined whether rights to tenancycould have been the subject matter of a bequest under a Will.Apex Court took the view that assignment of any interest in thetenanted land will not be valid. A devise or a bequest under a Willcannot be stated to fall outside the scope of the said provisioninasmuch as such assignment disposes of or deals with the lease.Apex Court also held that when there is a disposition of rightsunder a Will though operates posthumously is neverthelessrecognition of the right of the legatee thereunder as to his rightsof the tenanted land. In that event, there is an assignment of thetenanted land, but that right will come into effect after the deathof the testator. The purpose behind Section 21 is not to allowstrangers to the family of the tenant to come upon the land. TheApex Court held that tenanted land is not allowed to be sub-leti.e. to pass to the hands of a stranger nor any kind of assignmenttaking place in respect of the lease held. If the tenant could assignhis interest, strangers can come upon the land, and therefore, theexpression ‘assignment’ in Section 21 will have to be given suchmeaning as to promote the object of the enactment. Above decisionin Sangappa Kalyanappa Bangi[4] was later followed inJayamma[5] case while interpreting Section 61(1) & (3), 21(1),2(A)(12) & (17) of the Karnataka Land Reforms Act, 1961. Thequestion arose whether the expression ‘assignment’ would takein a Will. The Court held that on a fair construction of Section 61,a transfer of agricultural land with occupancy right is permissibleonly in favour of one of the heirs, having regard to the definition of ‘family’ as contained in Section 2(12) and ‘joint family’ ascontained in Section 2(17) of the said Act. The Court felt that thepurpose and object of the Legislature sought to be achieved byenacting Section 61 of the KLR Act is such that ‘assignment’would include ‘assignment by a Will’.”

8.2 Similarly, while construing the provisions of Section 63 of theAct, the Division Bench stated as under:-

“Section 63 unlike Section 43 of the Act does not contain theword ‘assignment’. Contention was raised that since no such word‘assignment’ occurs in Section 63, there is no restriction in thematter of transfer of agricultural lands to non-agriculturist througha testamentary disposition. Before examining the contention, itmay be mentioned the word ‘Will’ as such is not defined underthe Bombay Tenancy Act, but Section 2(h) of the Indian SuccessionAct defines the word ‘Will’ to mean a legal declaration of theintention of the testator with respect to his property which hedesires to be carried into effect after his death. A Will, therefore,is dependent upon the testator’s death for its vigour and effectand is liable to be revoked or altered during his life time. Questionis while he is alive, can he make an illegal declaration through a‘Will’ so as to defeat the object and purpose of the legislation.Will not such a declaration be opposed to public policy beingrepugnant to the public interest. Policy of the Act is discerniblefrom the preamble, marginal note, title and Section 43 and 63 andother related provisions and the Directive Principles of State Policy.Where the legislature deem it expedient to fetter the privilege offree alienation, the prohibition founded upon conditions of publicinterest, must be treated as obsolete. General rule is that propertyof any kind may be transferred by way of gift or Will, sale etc.unless non-transferability is barred due to existence of any law.Willian’s law relating to Will, Sixth Edition, Volume I, page 60states that the power of disposition by Will is not at the testatorscaprice, but extends only to the creation of those interests, whichare recognised by law. Theobold on Wills, Fourth Edition, Pg.629,says that a condition which is illegal or contrary to the policy ofthe law is void. Tenancy Act has not authorised parting ofagricultural land to a non-agriculturist without the permission ofthe authorised officer, therefore, if it is permitted through a A

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Atestamentary disposition, it will be defeating the very soul of thelegislation, which cannot be permitted. We wonder when testatorstatutorily debarred from transferring the agricultural lands to anon-agriculturist during his life time, then how he can be permittedto make a declaration of his intention to transfer agricultural landto a non-agriculturist to be operative after his death. Such attemptBof testator, in our view, is clearly against the public policy andwould defeat the object and purpose of the Tenancy Act. Section30 of the Hindu Succession Act acknowledges testamentarysuccession as a mode of succession, but not, by defeating thepurpose and object of any legislation, like Tenancy Law. TheClegislative intent that an agricultural land shall not go into the handsof a non-agriculturist is manifest in Section 63 of the BombayTenancy Act. In a country like ours where agriculture is the mainsource of livelihood, the restriction imposed in Section 63, cannotbe given a go-by, by a devise. Obvious purpose of Section 63, is toprevent indiscriminate conversion of agricultural lands forDnon-agricultural purpose and that provision strengthens thepresumption that agricultural land is not to be used as per theholders caprice or sweet-will.”

8.3 It also relied upon decision of this Court reported in State ofPunjab (now Haryana) and others vs. Amar Singh and another[6]Eand Dayandeo Ganpat Jadhav vs. Madhav Vithal Bhaskar andothers[7] and then concluded:-

“We are, therefore, of the considered view that if the agriculturistis permitted to dispose agricultural property through testamentarydisposition to a non-agriculturist the same will defeat the veryFpurpose and object of the Tenancy Act which cannot be permittedby a Court of law, therefore, we hold that decision rendered bythe learned Single Judges referred above earlier, otherwise, arenot correct enunciation of law and stand overruled. We, therefore,hold that Section 63 of the Bombay Tenancy Act also bars theGtransfer of agricultural land by an agriculturist to a non-agriculturistfor non-agricultural purpose unless permission is obtained fromthe Collector or any authorised officer as provided in that Section.We are informed by the learned counsel for the petitioner that 6 (1974) 2 SCC 70 : AIR 1974 SC 994H7 (2005) 8 SCC 340

large number of agricultural lands have already been transferredthrough testamentary disposition to non-agriculturists and are inuse and if the settled position is unsettled the same will causeconsiderable prejudice and inconvenience to the parties. We areof the view that there are matters to be considered by the learnedSingle Judge depending upon facts of each case and equities canbe worked out accordingly, on which, we express no opinion. Weare only called upon to answer the scope of Section 43 and 63 ofthe Tenancy Act, which we have already answered.”

9. In these appeals challenging the correctness of the decision ofthe Division Bench of the High Court, we have heard Mr. Sanjay Parikh,learned Senior Advocate and Mr. Raghavendra S. Srivatsa, learnedAdvocate for the Appellants and Mr. Aniruddha P. Mayee, learnedAdvocate for the State.

10. It is submitted by learned counsel for the Appellants that whatis prohibited under Sections 43 and 63 of the Act is transfer inter vivos,and not any ‘testamentary disposition’ by the holder of the land. In theirsubmission, the expressions used in Sections 43 and 63 like ‘sale’, ‘gift’,‘exchange’, and ‘mortgage’ are suggestive of transfers by a livingperson and the expression ‘assignment’ in Section 43(1) of the Actmust be read ejusdem generis with the preceding expressions appearingin that Section and that the expression ‘assignment’ does not even appearin Section 63. It is, therefore, submitted that both these provisions do notdeal with any ‘testamentary disposition’.

It is also submitted by Mr. Srivatsa that the concept of succession,whether testamentary or intestate, being part of Entry 5 of List III ofSeventh Schedule to the Constitution and a concurrent subject, the Centrallegislation namely Indian Succession Act, 1925 must hold the field andany prohibition in the State enactment inconsistent with the generalprinciples of the Central Legislation, in the absence of any assent of thePresident, would be void. It is further submitted that the State Legislaturemust be taken to be fully aware of this legal position and, therefore,while construing the term ‘assignment’ due regard to this aspect mustalso be given. As an extension of this submission, it is contended that thedecisions of this Court in relation to the provisions of the KarnatakaLand Reforms Act, 1961 in the cases of Sangappa[4 ]and Jayamma[5 ]aredistinguishable as the provisions of the Karnataka Land Reforms Act,1961 had received Presidential assent, whereas, the provisions of theAct have not received any such assent.

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AReliance is also placed on the Judgment of this Court in Mahadeo(Dead through legal representatives) vs. Shakuntalabai[8] in whichsimilar provisions from Bombay Tenancy and Agricultural Lands Act,1958 (as applicable to Vidarbha Region of State of Maharashtra) cameup for consideration before this Court.B11. On the other hand, Mr. Mayee, learned Advocate for the State

B11. On the other hand, Mr. Mayee, learned Advocate for the Statehas submitted that the basic intent behind the conferral of ownershiprights upon a cultivating tenant was to see that the actual tillers andcultivators must be protected and given the ownership rights upon paymentof nominal charges. The avowed objective of the Act, is to preserveagricultural lands in the hands of actual tillers, and not to let concentrationCof holdings in a few hands. It is further submitted that Section 63 of theAct gives indications that a transfer to a non-agriculturist is not permissibleand so also any transfer which results in taking the holding of the transfereebeyond ceiling limits, or if the income of the transferee was in excess ofRs. 5,000/-, would be impermissible. He submitted that these conditionsDdisclose the legislative intent which lays down the relevant criteria onthe basis of which the applications for transfer inter vivos could beconsidered and granted; and that any disposition by way of a testamentmust also be subject to similar conditions. In his submission, a testamentarydisposition which violated these basic norms ought not to be allowedand, therefore, the view taken by the Division Bench is correct.E

12. We may now consider the decisions of this Court which havedealt with issues concerning testamentary disposition of agriculturalholdings-

A. In Sangappa[4],the facts were noted as under:-F“2. The facts leading to this appeal are as follows:

Sangappa Bangi made an application under Section 45 of theKarnataka Land Reforms Act, 1961 (hereinafter referred to as“the Act”) in Form 7 claiming occupancy rights in respect of theland in question. During the pendency of the proceedings, he madeGa Will on 8-4-1975 bequeathing his tenancy rights in respect ofthe land in favour of one Ameerjan who claims to be the legalrepresentative of the appellant Sangappa who died during thependency of proceedings before the Tribunal. She in turn executedanother Will under which Husensab is making a claim to the land H8 (2017) 13 SCC 756

through the said Sangappa. Respondent 2 is the wife of the saidSangappa while Respondents 3 to 5 are the children of Sangappa.The Land Tribunal as well as the Appellate Authority examinedthe question whether right to tenancy could have been thesubject-matter of a bequest under a Will. In answering thatquestion, the Appellate Authority referred to a decision of theHigh Court of Karnataka in Shivanna v. Rachiah[9] (CRP No.319 of 1976 dated 29-3-1977 wherein it was stated that there wasno prohibition against a tenant disposing of his interest bytestamentary disposition. However it was stated that suchtestamentary disposition must be confined to the heirs of thedeceased or an interpretation of the provision of Sections 21 and24 of the Karnataka Land Reforms Act that the tenancy rightsare inherited only by legal representatives and not by anybodyelse; that tenancy could be deemed to have been continued infavour of the heirs of the tenant. It is also made clear that transferof tenancy rights made in violation of the provisions of Section 21would be void. The High Court did not give any detailed reasons,but taking the view that the Appellate Authority and the LandTribunal having concurrently held that Respondents 2 to 5 areentitled to grant of occupancy rights, found no reasons to interferewith the order made by them.”

The question that arose for consideration was dealt with by thisCourt as under:-

“5. This case gives rise to a difficult and doubtful question, whethera devise under a Will would amount to an assignment of interestin the lands and, therefore, would be invalid under the provisionsof Section 21 of the Land Reforms Act. What is prohibited underSection 21 of the Act is that there cannot be any sub-division orsub-letting of the land held by a tenant or assignment of any interestthereunder. Exceptions thereto are when the tenant dies, thesurviving members of the joint family and if he is not a member ofthe joint family, his heirs shall be entitled to partition andsub-divide the land leased subject to certain conditions. Section24 of the Act declares that when a tenant dies, the landlord isdeemed to continue the tenancy to the heirs of such tenant on the 9 (1977) 1 Kant LJ 146 (Short notes Item 160)

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same terms and conditions on which the tenant was holding at thetime of his death. We have to read Section 21 with Section 24 tounderstand the full purport of the provisions. Section 24 is enactedonly for the purpose of making it clear that the tenancy continuesnotwithstanding the death of the tenant and such tenancy is heldby the heirs of such tenant on the same terms and conditions onwhich he had held prior to his death. The heirs who can take theproperty are those who are referable to in Section 21. If he is amember of the joint family, then the surviving members of thejoint family and if he is not such a member of a joint family, hisheirs would be entitled to partition. Again, as to who his heirs arewill have to be determined not with reference to the Act, but withreference to the personal law on the matter. The assignment ofany interest in the tenanted land will not be valid. A devise or abequest under a Will cannot be stated to fall outside the scope ofthe said provisions inasmuch as such assignment disposes of ordeals with the lease. When there is a disposition of rights under aWill, though it operates posthumously is nevertheless a recognitionof the right of the legatee thereunder as to his rights of the tenantedland. In that event, there is an assignment of the tenanted land,but that right will come into effect after the death of the testator.Therefore, though it can be said in general terms that the devisesimpliciter will not amount to an assignment, in a special case ofthis nature, interpretation will have to be otherwise.

6. If we bear in mind the purpose behind Section 21, it becomesclear that the object of the law is not to allow strangers to thefamily of the tenant to come upon the land. The tenanted land isnot allowed to be sub-let, i.e., to pass to the hands of a strangernor any kind of assignment taking place in respect of the leaseheld. If the tenant could assign his interest, strangers can comeupon the land, and therefore, the expression “assignment” willhave to be given such meaning as to promote the object of theenactment. Therefore, the deceased tenant can assign his rightsonly to the heirs noticed in the provision and such heirs could onlybe the spouse or any descendants or one who is related to thedeceased tenant by legitimate kinship. We must take intoconsideration that when it is possible for the tenant to pass theproperty to those who may not necessarily be the heirs under theordinary law and who become heirs only by reason of a bequestunder a Will in which event, he would be a stranger to the family

and imported on the land thus to the detriment of the landlord. Inthat event, it must be taken that a devise under a Will will alsoamount to an assignment and, therefore, be not valid for the purposeof Section 21 of the Act. If Section 24 is read along with Section21, it would only mean that the land can pass by succession to theheirs of a deceased tenant, but subject to the conditions prescribedin Section 21 of the Act. Therefore, we are of the view that thebroad statement made by the High Court in the two decisions inShivanna[9]and Dhareppa v. State of Karnataka[10 ]would notpromote the object and purpose of the law. Therefore, the betterview appears to us is as stated by the High Court in Timmakka”Kom Venkanna Naik v. Land Tribunal[11].

B. Similar issues regarding disposition by will were dealt with bythis Court in Jayamma[5], as follows:- “16. We would discuss the construction of the provision of Section61 of the said Act, a little later, but we have no hesitation in holdingthat in the event if it be held that the testator could not haveexecuted the Will in favour of a person who could not be declaredto be a tenant having occupancy right, such a Will would be voidab initio and, therefore, non est in the eye of the law. The court insuch an event would not be determining a disputed question oftitle but would be considering the effect of the statute vis-à-visthe Will in question.

… … …

18. As we have noticed hereinbefore, that the statutory embargoon transfer of land is stricter in a case where the tenant hasbecome occupant than a land held by a tenant simpliciter. Wehave also noticed that the embargo on transfer is not only by wayof sale, gift, exchange, mortgage, lease but also by assignment.What is permitted under the law is partition of the land amongstthe members of the family. Section 61 of the Act is to be read inits entirety.

19. Sub-section (3) of Section 61 lays down that any transfer ofland in contravention of sub-section (1) shall be invalid whereuponthe same shall vest in the State Government free from all 10 (1979) 1 Kant LJ 18

11 (1987) 2 Kant LJ 337

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encumbrances. The legislative intent that the land should not beallowed to go into the hands of a stranger to the family is, therefore,manifest. Whereas in terms of Section 21, strangers to the familyof the tenant to come upon the land is not allowed, the tenor ofSection 61 is that except partition amongst the co-sharers, notransfer of the property, in any manner, is permissible.

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20. When an assignment or transfer is made in contravention ofstatutory provisions, the consequence whereof would be that thesame is invalid, and thus, being opposed to public policy the sameshall attract the provisions of Section 23 of the Indian ContractAct.

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21. It is not disputed that in view of the purport and object thelegislature sought to achieve by enacting the said provision theexpression “assignment” would include a Will.

22. In this case, there is also no dispute that grant of agriculturalland with occupancy right in terms of the provisions of the saidAct was made on 14-10-1981. The Will in question having beenexecuted on 20-2-1984; the transfer has been made within a periodof fifteen years from the date of grant which is prohibited in law.”

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C. Both these decisions were in the context of prohibition againstEtransfer or assignment under the provisions of the Karnataka LandReforms Act, 1961. In Mahadeo[8], this Court dealt with Section 57 ofthe Bombay Tenancy and Agricultural Lands Act, 1958 as applicable toVidarbha Region of State Maharashtra, and observed:- “4. The High Court took the view that the provisions of SectionF57 of the Bombay Tenancy and Agricultural Lands Act, 1958pertaining to Vidarbha Region do not permit the transfer of landby way of a will. Section 57 of the Act which is relevant reads asfollows:

“57. Restriction on transfers of land purchased or soldunder this Act.—(1) No land purchased by a tenant underGSection 41 or 46 or 49-A or 57-D or 130 or sold to any personunder Section 91 or 122 shall be transferred by sale, gift,exchange, mortgage, lease or assignment without the previoussanction of the Collector. Such sanction shall be given by theCollector in such circumstances and subject to such conditionsHas may be prescribed by the State Government.

(2) Any transfer of land in contravention of sub-section (1)shall be invalid:

Provided that nothing in this section shall apply to the landspurchased by an occupancy tenant.”

5. On a plain reading of the aforesaid provision, it is clear thattransfer without the previous sanction of the Collector isimpermissible by way of sale, gift, exchange, mortgage, lease orassignment. There is no prohibition insofar as the transfer of landby way of a will is concerned. In fact, in view of the decision ofthis Court in State of W.B. v. Kailash Chandra Kapur[12],devolution of property by way of a will does not amount to atransfer of the property. This is clear from para 12 of the aforesaiddecision wherein it has been observed that transfer connotes,normally, between two living persons during life. However, a willtakes effect after demise of the testator and transfer in thatperspective becomes incongruous.

6. That the beneficiary of a will receives the property by way ofdevolution and not by way of transfer is also made clear by thedecision of this Court in S. Rathinam alias Kappamuthu andOthers v. L.S. Mariappan and Others[13] wherein this Court hasheld in para 21 that: (SCC p. 732)

“21. A testator by his will, may make any disposition of hisproperty subject to the condition that the same should not beinconsistent with the laws or contrary to the policy of the State.A will of a man is the aggregate of his testamentary intentionsso far as they are manifested in writing. It is not a transfer buta mode of devolution.”

In coming to this conclusion, this Court referred to Beru Ramv. Shankar Dass[14].”

D. It must be stated here that the decisions in Sangappa[4 ]andJayamma[5 ]were rendered by benches of two judges and so wasthe decision in Mahadeo[8]. However, the decision in Mahadeodoes not show that the attention of the bench was invited to the earlier decisions in Sangappa[4]and Jayamma[5].

12 (1997) 2 SCC 387

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E. The decision of this Court in Sangappa[4 ]had approved thedecision of the Division Bench of the High Court of Karnataka inTimmakka[11], wherein following observations were made by theDivision Bench:- A

“13. Two decisions of the Supreme Court were also referred,in support of his contention by the learned Counsel. In JaspalSingh v. The Additional District Judge, Bulandshahr &Ors.[15], a question arose under U.P.Act 13/1972. There was abar against transfer of the tenant’s interest during his life time.Similarly, if a tenant sub leases the premises, he was liable tobe ejected. Therefore, is was held that the scheme of the Actdid not warrant the transfer of the tenancy right, to be effectiveafter the life time of the tenant, Thus the claim of the nephewof the tenant who claimed the right under a Will executed bythe deceased tenant was rejected.

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14. In Bhavarlal Labhchand Shah v. KanaiyalalDNathalal Intawala[16] the question was whether the tenantof a non - residential premises continuing in occupation afterthe period of contract is over, can bequeath his right ofoccupation by will. The Supreme Court negatived such acontention. The Supreme Court approved the observationsEof the Bombay High Court in Dr. Anant Trimbak Sabnis v.Vasant Pratap Pandi[17] which were extracted……..

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15. Having regard to the above decisions, we are of theopinion that the deceased Hammi could not have bequeathedFthe tenancy right in favour of respondents 2 and 3 or to anyone of them. If so, any possession and cultivation byrespondents 2 and 3, after the death of the original tenantHammi, cannot be termed as lawful and they cannot be termedas tenants. It has also come on record that throughout thereGwas protest by the appellant against registering the names ofrespondents 2 and 3 or any one of them as a tenant in the G

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record of rights. Therefore, as on 1-3-1974 neitherrespondent-2 nor respondent-3 was cultivating the lands inquestion as a tenant and hence Sections 44, 45or 48-A oftheAct cannot govern their claim. The Land Tribunal erred ingranting occupancy right in favour of respondents 2 and 3 onthe basis of the alleged will and hence the same is liable to beset aside. In this view of the matter, the learned Single Judgeshould have reversed the order of the Land Tribunal.Therefore, the order of the learned Single Judge also cannotbe sustained.”

F. On the other hand, the decision in Mahadeo[8 ]had placed relianceon the decisions of this Court in State of West Bengal vs. KailashChandra Kapur[12 ]and in S. Rathinam[13]. In neither of these cases anystatutory prohibition or restriction on transfer or assignment was involved.

13. The decisions in Sangappa[4], Jayamma[5] and Mahadeo[8] haddealt with the question whether prohibition against transfer of agriculturalholdings applied to testamentary disposition. While dealing with thequestion whether a tenant governed by Rent Act could will away histenancy, in Bhavarlal Labhchand Shah[16 ]the issue was considered inthe light of prohibition against transfer or assignment in Section 15 of theBombay Rents, Hotel and Lodging House Rates Control Act, 1947. ThisCourt relied upon the earlier decision of this Court in Jaspal Singh vs.Additional District Judge, Bulandshahr[15] and the decision of theDivision Bench of the High Court of Bombay in Dr. Anant TrimbakSabnis[17 ]and observed:- “9. In Jaspal Singh v. Additional District Judge, Bulandshahr[15]this Court had occasion to consider the validity of a bequest of theright of a tenant to continue to occupy the premises after thedetermination of the tenancy under U.P. Urban Buildings(Regulation of Letting, Rent and Eviction) Act, 1972 under a will.Section 3(a) of the U.P. Act referred to above defined theexpression “tenant” thus:

“3. In this Act, unless the context otherwise requires—

(a) ‘tenant’, in relation to a building, means a person bywhom its rent is payable, and on the tenant’s death—

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(1) in the case of a residential building, such only of hisheirs as normally resided with him in the building at thetime of his death;

(2) in the case of a non-residential building, his heirs;”

10. The appellant in that case claimed the right to tenancy held byone Naubat Singh under the will of Naubat Singh. This Court heldthat the appellant would be a tenant within the meaning of Section3(a) of that Act only when he was an heir but the appellant wasnot a son but only nephew of Naubat Singh. The said U.P. Actalso contained a provision in Section 12(2) thereof which statedthat in the case of non-residential building where a tenant carryingon a business in the building admitted a person who was not amember of his family as a partner or a new partner, as the casemay be, the tenant should be deemed to have ceased to occupythe building. Under those circumstances this Court held at p. 1885thus: (SCC pp. 440-41, para 10)

“From a survey of these provisions it will be clear that if atenant parts with possession of the premises in his possession,the same would be treated as vacant.... In the case of a non-residential building, when a tenant is carrying on business inthe building, admits a person who is not a member of his familyas a partner or a new partner, as the case may be, the tenantshall be deemed to have ceased to occupy the building. If atenant sublets the premises, he is liable to ejectment. Obviously,therefore, there are restrictions placed by the Act on the rightof the tenant to transfer or sublet the tenancy rights and hecan keep possession of the building or premises for himselfand for the purpose of his family, for his business and for thebusiness of his family members. He obviously cannot be allowedto transfer a tenancy right. A fortiori, the scheme of the Actdoes not warrant the transfer of the tenancy right to be effectiveafter his lifetime.”

11. In the Act under consideration in the present case also thereis a provision similar to the provision contained in Section 12(2) ofthe U.P. Act. Section 15(1) of the Act reads thus:

“15. In absence of contract to the contrary tenant not tosublet or transfer.— (1) Notwithstanding anything contained in any law, (but subject to any contract to the contrary), it shallnot be lawful after the coming into operation of this Act forany tenant to sublet the whole or any part of the premises letto him or to assign or transfer in any other manner hisinterest therein:….”

12. In Dr. Anant Trimbak Sabnis[17 ]the High Court of Bombayhas in the light of Section 15(1) of the Act taken the view and inour opinion rightly that the words “to assign or transfer in anyother manner his interest therein” in Section 15(1) of the Act hadthe effect of prohibiting the deposition of the tenancy right by awill in the absence of a contract to the contrary. The High Courtof Bombay observed at pp. 72 and 73 thus:

“12. Prohibition against transfer of tenancy rights by the tenantsis just a corollary to the restrictions on the landlords and isaimed at protecting them, in turn, by preventing the tenantsfrom abusing these protections by thrusting uncontemplatedstrangers as tenants on the landlords, willy nilly, for monetarygain or favouring any friend or relative of theirs, and thusensuring, that the immunity against eviction is not expandedinto licence to dispose of premises as if it were their own andlandlords’ rights are not invaded beyond what is strictlynecessary….

13. Bequest of tenancy rights in this context stands on thesame footing as any other transfer by sub-lease, sale,assignment, gift, volition of the tenant in inductinguncontemplated strangers in the premises and thrusting themon the landlord, being the common element of these dispositions.It makes little difference to the invasion on the landlord’s rightwhether such uncontemplated stranger is so inducted by thetenant for gain or just as a favour — invasion in either casehaving no nexus with the object underlying these protections.It is difficult to imagine why the legislature could have intendedto exclude such bequests from the sweep of the prohibitedassignments and transfers under Section 15, when bequest ispregnant with the same evils as other transfers. The words“transfer in any manner” in this context only go to signifyinclusion of ‘bequest’ also therein.

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14. It is not without significance that legatee is not included inthe definition of the word ‘tenant’. Section 5(11) of the Actdefines it to mean “a person who is liable to pay the rent or onwhose account the rent is payable for any premises”. Undersub-clauses (a) to (c) it is enlarged to include some otherswhom legislature considered it necessary to protect. Clause(c) provides for the succession to tenancy rights on the deathof the tenant. Thus, this sub-clause (c) by providing for themode of succession, impliedly excludes successors from thepurview of the width of the main clause. Secondly, it restrictsthe succession even by operation of law of inheritance to thepersons and situations indicated therein and impliedly excludingall other heirs. In fact, all the heirs are liable to be excluded ifany other member of the family was staying with the tenant atthe time of his death. Thirdly and more importantly, legatee isnot included either in this sub-clause or any other sub-clauses.This demonstrates legislative intent to prohibit testamentarydisposition of the tenancy rights. There is no other expressprovision to this effect in the Rent Act. It shall have to betraced only in Section 15 thereof by interpreting the words‘assign’ and ‘transfer’ in their generic sense. This also fortifiesour interpretation of these words.”

13. The above reasons given by the Bombay High Court in supportof its decision are perfectly justified in the context of the objectand the scheme of the Act. The language of the statute also lendsitself to the same construction.”

14. On the other hand, in respect of leases to which the provisionsof any Rent Act did not specifically apply, the principles laid down inBhavarlal[14 ]were not applied by this Court. The decision of this Courtin State of W.B. v. Kailash Chandra Kapur[12 ]had observed:- “11. It was, therefore, held that in the absence of any definitionthe legal heirs of the tenants who succeeded by intestatesuccession became the tenants under the Rent Act for the purposeof continuance of tenancy rights had by the tenant even if it isafter the determination of the contractual tenancy. The statutorytenancy steps in and gives protection to the legal heirs of thedeceased tenant. It is true that in that case no distinction wasmade by this Court between testamentary succession or intestate

succession. As far as testamentary succession is concerned, thisCourt had considered that question in Bhavarlal case[16]. In thatcase, Section 5(11) of the Bombay Rent Act defines the tenantand clause (c) defines the “restricted tenancy rights” in favour ofthe family members of the tenant. In that context, the questionarose in that case whether a tenant can bequeath a Will in favourof a stranger? Considering the ratio in Gian Devi case[18] and theobject of the Act, this Court had held that the tenant cannot by aWill bequeath leasehold right in favour of strangers and induct thestranger as tenant of the demised premises against the Will of thelandlord and the landlord is not bound by such a bequest to recognisethe legatee as a tenant. It is, thus, settled law that though leaseholdinterest may be bequeathed by a testamentary disposition, thelandlord is not bound by it nor a stranger be trusted as tenantagainst the unwilling landlord.

12. In view of the above-settled legal position, the question iswhether the bequest made by Mullick in favour of the respondentis valid in law and whether the Governor is bound to recognisehim. It is seen that clauses (7), (8) and (12) are independent andeach deals with separate situation. Clause (7) prohibits sub-leaseof the demised land or the building erected thereon without priorconsent in writing of the Government. Similarly, clause (8) dealswith transfer of the demised premises or the building erectedthereon without prior permission in writing of the Government.Thereunder, the restricted covenants have been incorporated bygranting or refusing to grant permission with right of pre-emption.Similarly, clause (12) deals with the case of lessee dying afterexecuting a Will. Thereunder, there is no such restrictive covenantcontained for bequeath in favour of a stranger. The word “person”has not been expressly specified whether it relates to the heirs ofthe lessee. On the other hand, it postulates that if the bequest is infavour of more than one person, then such persons to whom theleasehold right has been bequeathed or the heirs of the deceasedlessee, as the case may be, shall hold the said property jointlywithout having any right to have a partition of the same and oneamong them should alone be answerable to and the Governmentwould recognise only one such person. In the light of the language ABC

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Aused therein, it is difficult to accept the contention of Shri V.R.Reddy, that the word “person” should be construed with referenceto the heirs or bequest should be considered to be a transfer.Transfer connotes, normally, between two living persons duringlife; Will takes effect after demise of the testator and transfer inthat perspective becomes incongruous. Though, as indicated earlier,Bthe assignment may be prohibited and the Government intendedto be so, a bequest in favour of a stranger by way of testamentarydisposition does not appear to be intended, in view of the permissivelanguage used in clause (12) of the covenants. We find no expressprohibition as at present under the terms of the lease. Unless theCGovernment amends the rules or imposes appropriate restrictivecovenants prohibiting the bequest in favour of the strangers or byenacting appropriate law, there would be no statutory power toimpose such restrictions prohibiting such bequest in favour of thestrangers. It is seen that the object of assignment of the governmentland in favour of the lessee is to provide him right to residence. IfDany such transfer is made contrary to the policy, obviously, it wouldbe defeating the public purpose. But it would be open to theGovernment to regulate by appropriate covenants in the leasedeed or appropriate statutory orders as per law or to make a lawin this behalf. But so long as that is not done and in the light of theEpermissive language used in clause (12) of the lease deed, it cannotbe said that the bequest in favour of strangers inducting a strangerinto the demised premises or the building erected thereon is notgoverned by the provisions of the regulation or that prior permissionshould be required in that behalf. However, the stranger legateeshould be bound by all the covenants or any new covenants orFstatutory base so as to bind all the existing lessees.”

15. Various States have enacted legislations seeking to invalidatetransfers of agricultural lands made by tribals or socially disadvantagedpersons to non-tribals or transferees from non-backward communitieswhich legislations have gone to the extent of nullifying transactions enteredGinto even before the legislations had come into effect. Validity of theselegislations have been sustained by this Court. Two such cases are asfollows:-

A) Section 4 of the Karnataka Scheduled Castes and ScheduledTribes (Prohibition of Transfer of Certain Lands) Act, 1974 prohibits H

transfer of “granted lands” which expression is defined in Section 3(b)to mean any land granted by the Government to a person belonging toany of the Scheduled Castes or the Scheduled Tribes. Any transfer madeeither before or after the commencement of said Act is rendered nulland void by Section 4 and the land is to be resumed and dealt with inaccordance with the provisions of said Act. Dealing with the challenge,a bench of three Judges of this Court in Manchegowda vs. State ofKarnataka[19] stated:-

“15. Any person who acquires such granted land by transfer fromthe original grantee in breach of the condition relating to prohibitionon such transfer must necessarily be presumed to be aware ofthe prohibition imposed on the transfer of such granted land.Anybody who acquires such granted land in contravention of theprohibition relating to transfer of such granted land cannot beconsidered to be a bona fide purchaser for value; and every suchtransferee acquires to his knowledge only a voidable title to thegranted land. The title acquired by such transfer is defeasible andis liable to be defeated by an appropriate action taken in this regard.If the Legislature under such circumstances seek to intervene inthe interests of these weaker sections of the community and chooseto substitute a speedier and cheaper method of recovery of thesegranted lands which were otherwise liable to be resumed throughlegal process, it cannot, in our opinion, be said that any vestedrights of the transferees are affected. Transferees of granted landswith full knowledge of the legal position that the transfers made intheir favour in contravention of the terms of grant or any law, ruleor regulation governing such grant are liable to be defeated in law,cannot and do not have in law or equity, a genuine or real grievancethat their defeasible title in such granted lands so transferred is, infact, being defeated and they are being dispossessed of such landsfrom which they were in law liable to be dispossessed by processof law. The position will, however, be somewhat different wherethe transferees have acquired such granted lands not in violationof any term of the grant or any law regulating such grant as alsowhere any transferee who may have acquired a defeasible title insuch granted lands by the transfer thereof in contravention of theterms of the grant or any law regulating such grant has perfectedhis title by prescription of time or otherwise. We shall consider 19 (1984) 3 SCC 301

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such cases later on. But where the transferee acquires only adefeasible title liable to be defeated in accordance with law,avoidance of such defeasible title which still remains liable to bedefeated in accordance with law at the date of commencementof the Act and recovery of possession of such granted land on thebasis of the provisions contained in Section 4 and Section 5 of theAct cannot be said to be constitutionally invalid and such a provisioncannot be termed as unconscionable, unjust and arbitrary. Thefirst two contentions raised on behalf of the petitioners are,therefore, overruled.

16. The next contention that Sections 4 and 5 of the Actempowering the authority to take possession of the granted landswithout payment of any compensation are violative of Article19(1)(f) of the Constitution is without any merit. Article 19(1)(f)which was in force at the relevant time provided that all citizensshall have the right “to acquire, hold and dispose of property”.

17. Granted lands were intended for the benefit and enjoyment ofthe original grantees who happen to belong to the Scheduled Castesand Scheduled Tribes. At the time of the grant, a condition hadbeen imposed for protecting the interests of the original granteesin the granted lands by restricting the transfer of the same. Thecondition regarding the prohibition on transfer of such grantedlands for a specified period, was imposed by virtue of the specificterm in the grant itself or by reason of any law, rule or regulationgoverning such grant. It was undoubtedly open to the grantor atthe time of granting lands to the original grantees to stipulate sucha condition, the condition being a term of the grant itself, and thecondition was imposed in the interests of the grantee. Except onthe basis of such a condition the grantor might not have made anysuch grant at all. The condition imposed against the transfer for aparticular period of such granted lands which were grantedessentially for the benefit of the grantees cannot be said toconstitute any unreasonable restriction. The granted lands werenot in the nature of properties acquired and held by the granteesin the sense of acquisition, or holding of property within the meaningof Article 19(1)(f) of the Constitution. It was a case of a grant bythe owner of the land to the grantee for the possession andenjoyment of the granted lands by the grantees and the prohibition on transfer of such granted lands for the specified period was anessential term or condition on the basis of which the grant wasmade. It has to be pointed out that the prohibition on transfer wasnot for an indefinite period or perpetual. It was only for a particularperiod, the object being that the grantees should enjoy the grantedlands themselves at least for the period during which the prohibitionwas to remain operative. Experience had shown that personsbelonging to the Scheduled Castes and Scheduled Tribes to whomthe lands were granted were, because of their poverty, lack ofeducation and general backwardness, exploited by various personswho could and would take advantage of the sad plight of thesepoor persons for depriving them of their lands. The imposition ofthe condition of prohibition on transfer for a particular period couldnot, therefore, be considered to constitute any unreasonablerestriction on the right of the grantees to dispose of the grantedlands. The imposition of such a condition on prohibition in the verynature of the grant was perfectly valid and legal.”

B) Another bench of three Judges of this Court considered thechallenge to the provisions of the Maharashtra Restoration of Lands toScheduled Tribes Act, 1974 in Lingappa Pochanna Appelwar vs. Stateof Maharashtra and another[20]. While rejecting the challenge this Courtobserved:-

“18. The impugned Act is nothing but a remedial measure inkeeping with the policy of the State for rendering social andeconomic justice to this weaker section of the society. The takingof their lands may have been done by way of transfer under theordinary, laws in various ways. The processes and forms of lawwere apparently followed. But the result has been devastating.As a result of such unequal transactions which were grosslyunconscionable and unjust, the tribals lost their lands to non-tribalsand were rendered landless. It is implicit in the nature of thelegislation that the law regards such transactions as unconscionableand oppressive, and directs restoration of the property to the tribaltransferor treating the transfer to be non est. It is axiomatic that acontract is liable to be set aside due to inequality of bargainingpower, if someone without independent advice, enters into acontract on terms which are very unfair or transfers property for A

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a consideration which is grossly inadequate when his bargainingpower is grievously impaired by reason of his own need orcircumstances, or by his own ignorance or infirmity, coupled withundue influences or pressures brought to bear on him by or forthe benefit of the other.”

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BThere was a challenge on the ground of legislative competenceas well, which aspect will be dealt with later.

16. A bench of three Judges of this Court placed reliance on thedecisions in Manchegowda[19] and Lingappa Pochanna Appelwar v.State of Maharashtra[20 ]and found that even a voluntary surrender by amember of a Scheduled Tribe would come within the expression“transfer” in Section 71-A of the Chhotanagpur Tenancy Act, 1908. InPandey Oraon vs Ram Chander Sahu and Others[21], this Court held:- C

“6. In Section 71-A in the absence of a definition of transfer andconsidering the situation in which exercise of jurisdiction iscontemplated, it would not be proper to confine the meaning oftransfer to transfer under the Transfer of Property Act or a situationwhere transfer has a statutory definition. What exactly iscontemplated in the provision is where possession has passed fromone to another and as a physical fact the member of the ScheduledTribe who is entitled to hold possession has lost it and a non-member has come into possession would be covered by transferand a situation of that type would be amenable to exercise ofjurisdiction within the ambit of Section 71-A of the Act.

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7. The provision is beneficial and the legislative intention is toextend protection to a class of citizens who are not in a position tokeep their property to themselves in the absence of protection.Therefore, when the legislature is extending special protection tothe named category, the court has to give a liberal construction tothe protective mechanism which would work out the protectionand enable the sphere of protection to be effective than limit by(sic) the scope. In fact, that exactly is what has been said by athree Judge bench of this Court in almost a similar situation inManchegowda[19 ]and what was said by a three Judge benchfollowed by a later decision of this Court in Lingappa[20]. To thesame effect is the observation of this Court in Gamini Krishnayya F

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v. Guraza Seshachalam[22]. The House of Lords in D (a minor)v. Bershire County Council[23] said that broad and liberalconstruction should be given to give full effect to the legislativepurpose. We would, therefore, in the facts and circumstancesappearing in this case, hold that the authorities under the Act werejustified in extending the provision of Section 71-A of theChotanagpur Tenancy Act to the situation which emerged andthe High Court took a wrong view in limiting the concept of transferto the statutory definition in the T.P. Act and holding that Section 71-A was not applicable in a case of this type. On this basis, itmust follow that the action of the statutory authority was justifiedand the conclusion of the Full Bench must not be sustained. Weaccordingly allow the appeal and reverse the decision of the HighCourt.”

17. In Amrendra Pratap Singh vs. Tej Bahadur Prajapati andOthers[24], a question arose whether a plea of adverse possession by anon-tribal with regard to land of a tribal situated in the scheduled areacould be entertained. While dealing with the question, followingobservations were made by this Court:- “14. …… Dictionaries can be taken as safe guides for findingout meanings of such words as are not defined in the statute.However, dictionaries are not the final words on interpretation.The words take colour from the context and the setting in whichthey have been used. It is permissible to assign a meaning or asense, restricted or wider than the one given in dictionaries,depending on the scheme of the legislation wherein the word hasbeen used. The court would place such construction on themeaning of the words as would enable the legislative intent beingeffectuated. Where the object of the legislation is to prevent amischief and to confer protection on the weaker sections of thesociety the court would not hesitate in placing an extendedmeaning, even a stretched one. on the word, if in doing so thestatute would succeed in attaining the object sought to be achieved.We may refer to Principles of Statutory Interpretation by JusticeG.P. Singh (8[th] Edn., 2001) wherein at pp. 279-280 the learnedauthor states- 22 AIR 1965 SC 639

23 (1987) 1 All ER 20 (HL)

24 (2004) 10 SCC 65

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“. . . . .in selecting one out of the various meaning of a word,regard must always be had to the context as it is a fundamentalrule that ‘the meanings of words and expressions used in anAct must take their colour from the context in which theyappear’. Therefore, ‘when the context makes the meaning ofa word quite clear, it becomes unnecessary to search for andselect a particular meaning out of the diverse meanings a wordis capable of, according to lexicographers’. . .... Judge LearnedHand cautioned ‘not to make a fortress out of the dictionary’but to pay more attention to ‘the sympathetic and imaginativediscovery’ of the purpose or object of the statute as a guide toits meaning.”

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19. State of M.P. v. Babu Lal[25] is an interesting case showinghow this Court dealt with an artistic device employed by a non-tribal to deprive a tribal of his land. The M.P. Land Revenue Code,1959 imposed restrictions on the transfer of land by members of aScheduled Tribe. Babu Lal, a non-tribal, filed a suit for declarationagainst Baddiya, a Bheel, notified Scheduled Tribe, for declarationthat his name be recorded in the revenue record as bhumiswamiover the land of Baddiya. Baddiya did not contest the suit and theparties filed a compromise conceding to the claim of Babu Lal.The State Government intervened and filed a petition in the HighCourt seeking a writ of certiorari, submitting that the entireproceedings in the suit were in contravention of sub-section (6) ofSection 165 of the M.P. Land Revenue Code, 1959. The judgmentof the civil court based on compromise was sought to be quashed.The High Court dismissed the petition holding that the State couldpursue the alternative remedy of filing a suit for declaration thatthe decree was null and void. In appeal by special leave, thisCourt set aside the judgment of the High Court and issued a writof certiorari to quash the judgment and decree passed in the civilsuit. It was held: (SCC p. 436, para 5)

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“5. One of the principles on which certiorari is issued iswhere the Court acts illegally and there is error on theface of record. If the Court usurps the jurisdiction, therecord is corrected by certiorari. This case is a glaring H25 (1977) 2 SCC 435

instance of such violation of law. The High Court was inerror in not issuing writ of certiorari.”

20. The law laid down by this Court is an authority for theproposition that the court shall step in and annul any suchtransaction as would have the effect of violating a provision oflaw, more so when it is a beneficial piece of social legislation. Asimple declaratory decree passed by a civil court which had theeffect of extinguishing the title of a member of a Scheduled Tribeand vesting the same in a non-member, was construed as “transfer”within the meaning of Section 165(6) of the M.P. Land RevenueCode, 1959. Thus, we are very clear in our minds that theexpression “transfer of immovable property” as defined in clause(f) of para 2 of the 1956 Regulations has to be assigned a verywide meaning. Any transaction or dealing with immovable propertywhich would have the effect of extinguishing title, possession orright to possess such property in a tribal and vesting the same in anon-tribal, would be included within the meaning of “transfer ofimmovable property”.

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24. In Madhavrao Waman Saundalgekar v. RaghunathVenkatesh Deshpande[26] Their Lordships of the Privy Councildealt with a case of watan lands and observed that it is somewhatdifficult to see how a stranger to a watan can acquire a title byadverse possession for twelve years of lands, the alienation ofwhich is, in the interests of the State, prohibited. The PrivyCouncil’s decision was noticed in Karimullakhan v.Bhanupratapsingh[27] and the High Court noted non-availabilityof any direct decision on the point and resorted to borrowing fromanalogy. It was held that title by adverse possession on inam lands,watan lands and debutter, was incapable of acquisition.

25. Reverting back to the facts of the case at hand, we find thatin the land, the ultimate ownership vests in the State on the principleof eminent domain. Tribals are conferred with a right to hold land,which right is inalienable in favour of non-tribals. It is clear thatthe law does not permit a right in immovable property vesting in a 26 AIR 1923 PC 205 : 50 IA 255 : ILR 47 Bom 798

27 AIR 1949 Nag 265 : ILR 1948 Nag 978

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tribal to be transferred in favour of or acquired by a non-tribal,unless permitted by the previous sanction of a competent authority.The definition of “transfer of immovable property” has been coinedin the widest-possible terms. The definition makes a reference toall known modes of transferring right, title and interest in immovableproperty and to make the definition exhaustive, conspicuouslyemploys the expression “any other dealing with such property”,which would embrace within its sweep any other mode having animpact on right, title or interest of the holder, causing it to cease inone and vest or accrue in another. The use of the word “dealing”is suggestive of the legislative intent that not only a transfer assuch but any dealing with such property (though such dealing maynot, in law, amount to transfer), is sought to be included within themeaning of the expression. Such “dealing” may be a voluntaryact on the part of the tribal or may amount to a “dealing” becauseof the default or inaction of the tribal as a result of his ignorance,poverty or backwardness, which shall be presumed to have existedwhen the property of the tribal is taken possession of or otherwiseappropriated or sought to be appropriated by a non-tribal. In otherwords, a default or inaction on the part of a tribal which results indeprivation or deterioration of his rights over immovable propertywould amount to “dealing” by him with such property, and hencea transfer of immovable property. It is so because a tribal isconsidered by the legislature not to be capable of protecting hisown immovable property. A provision has been made by para 3-Aof the 1956 Regulations for evicting any unauthorised occupant,by way of trespass or otherwise, of any immovable property of amember of a Scheduled Tribe, the steps in regard to which maybe taken by the tribal or by any person interested therein or evensuo motu by the competent authority. The concept of locus standiloses its significance. The State is the custodian and trustee of theimmovable property of tribals and is enjoined to see that the tribalremains in possession of such property. No period of limitation isprescribed by para 3-A. The prescription of the period of twelveyears in Article 65 of the Limitation Act becomes irrelevant so faras the immovable property of a tribal is concerned. The tribalneed not file a civil suit which will be governed by the law oflimitation; it is enough if he or anyone on his behalf moves theState or the State itself moves into action to protect him and restores his property to him. To such an action neither Article 65 of theLimitation Act nor Section 27 thereof would be attracted.

26. In our opinion, the abovesaid shall be the position of law underthe 1956 Regulations where “transfer of immovable property”has been defined and also under the 1950 Act where “transfer ofholding” has not been defined. Acquisition of title in favour of anon-tribal by invoking the doctrine of adverse possession over theimmovable property belonging to a tribal, is prohibited by law andcannot be countenanced by the court.”

The law laid down in Amarendra Pratap Singh[24] was followedby this Court in Lincai Gamango and Others vs. Dayanidhi Jenaand Others[28].

18. Some of the other cases, where the legislative intent ofprohibiting transfer was taken note of and suitably extended, are as under:-

A) While dealing with the question whether prohibition againsttransfer in Section 42(b) of the Rajasthan Tenancy Act, 1955 would getattracted as against a juristic person such as a limited company, thisCourt in State of Rajasthan and Others vs. Aanjaney Organic HerbalPrivate Limited[29] held:- “7. Heard the learned counsel on either side. The Act is a beneficiallegislation which takes special care to protect the interest of themembers of Scheduled Castes and Scheduled Tribes. Section 42provides some general restrictions on sale, gift and bequest of theinterest of Scheduled Castes and Scheduled Tribes, in the wholeor part of their holding. The reason for such general restrictions isnot only to safeguard the interest of the members of ScheduledCastes and Scheduled Tribes, but also to see that they are notexploited by the members of non-Scheduled Castes and ScheduledTribes. The relevant provisions of Section 42(b) are extractedbelow for easy reference:

“42.General restrictions on sale, gift & bequest.—The sale,gift or bequest by a khatedar tenant of his interest in the whole orpart of his holding shall be void, if—

(a) ***

28 (2004) 7 SCC 437

29 (2012) 10 SCC 283

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(b) such sale, gift or bequest is by a member of a ScheduledCaste in favour of a person who is not a member of the ScheduledCaste, or by a member of a Scheduled Tribe in favour of a personwho is not a member of the Scheduled Tribe;”

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12. The expressions “Scheduled Castes” and “Scheduled Tribes”,we find in Section 42(b) of the Act have to be read along with theconstitutional provisions and, if so read, the expression “who isnot a member of the Scheduled Caste or Scheduled Tribe” wouldmean a person other than those who have been included in theCpublic notification as per Articles 341 and 342 of the Constitution.The expression “person” used in Section 42(b) of the Act thereforecan only be a natural person and not a juristic person, otherwise,the entire purpose of that section will be defeated. If the contentionof the Company is accepted, it can purchase land from ScheduledCaste/Scheduled Tribe and then sell it to a non-Scheduled CasteDand Scheduled Tribe, a situation the legislature wanted to avoid. Athing which cannot be done directly cannot be done indirectlyoverreaching the statutory restriction.

13. We are, therefore, of the view that the reasoning of the HighCourt that the respondent being a juristic person, the sale effectedEby a member of Scheduled Caste to a juristic person, which doesnot have a caste, is not hit by Section 42 of the Act, is untenableand gives a wrong interpretation to the abovementioned provision.”

B) Similarly, in Rajasthan Housing Board vs. New Pink CityNirman Sahkari Samiti Limited and Another[30], the effect of saidFSection 42(b) in the context where the land was acquired from membersof Scheduled Castes and Scheduled Tribes by a Society, was consideredby a bench of three Judges as under:- “26. In the instant case, the transaction is ab initio void, that is,right from its inception and is not voidable at volition by virtue ofGthe specific language used in Section 42 of the Rajasthan TenancyAct. There is declaration that such transaction of sale of holding“shall be void”. As the provision is declaratory, no furtherdeclaration is required to declare prohibited transaction a nullity.No right accrues to a person on the basis of such a transaction.

H30 (2015) 7 SCC 601

The person who enters into an agreement to purchase the same,is aware of the consequences of the provision carved out in orderto protect weaker sections of the Scheduled Castes and ScheduledTribes. The right to claim compensation accrues from right, titleor interest in the land. When such right, title or interest in land isinalienable to non-SC/ST, obviously the agreements entered intoby the Society with the khatedars are clearly void and decreesobtained on the basis of the agreement are violative of the mandateof Section 42 of the Rajasthan Tenancy Act and are a nullity.Such a prohibited transaction opposed to public policy, cannot beenforced. Any other interpretation would be defeasive of the veryintent and protection carved out under Section 42 as per themandate of Article 46 of the Constitution, in favour of the poorcastes and downtrodden persons, included in the Schedules toArticles 341 and 342 of the Constitution of India.”

19. The prohibition against transfer of a land of a tribal to anon-tribal was extended in Shamjibhai Keshavjibhai Kansagra (Patel)& Ors. V. Principal Secretary, Revenue Dept. (Appeals) & Ors.[31]by the Division Bench of the High Court of Gujarat to testamentarydisposition in favour of a non-tribal. Section 73AA of the Bombay LandRevenue Code, 1879 (as applicable to State of Gujarat) restricts “transferof occupancy” from tribals to non-tribals, without the previous sanctionof the Collector. The Division Bench considered, inter alia, the judgmentwhich is presently under appeal and observed as under:

“13. Chapter VI of the Code relates to ‘grant, use andrelinquishment of unalienated land’. Under Section 68 occupants’rights are conditional. An occupant is entitled to the use andoccupation of his land for the period, if any, to which his tenure islimited or if the period is unlimited or a survey settlement hasbeen extended to the land in perpetuity conditionally on the paymentof the amounts due on account of the land revenue for the same.Under the proviso thereto, the Collector may grant permission toany person to occupy any unalienated unoccupied land for certainperiod. Under Section 73 occupancy is transferable and inheritablesubject to Section 56 of the Act. Section 73A empowers the StateGovernment to restrict the right of transfer. Under Section 73AA,there is restriction on transfer of occupancies of tribals to tribals AB

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or non-tribals notwithstanding anything contained in Section 73except without previous sanction of the Collector as evident fromthe said provision, relevant portion of which is quoted hereunder:

“73AA. Restriction on transfer of occupancies of tribals totribals or non-tribals.-(1) Notwithstanding anythingcontained in Section 73, an occupancy of a person belongingto any of the Schedule Tribes hereafter in this section andin Section 73AB referred to as ‘the tribal’ shall not betransferred to any person without the previous sanction ofthe Collector.

(2) The previous sanction of the Collector under Sub-section(1) may be given in such circumstances and subject to suchconditions as may be prescribed.”

14. From the aforesaid provision, it will be evident that there is arestriction on ‘transfer of occupancy’ of land of tribals by anymode, whether sale, gift, exchange, mortgage, lease or assignmentor even under a will.

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19. It is true that there is a difference between a transfer ofproperty and a bequest under will. Transfer of Property Act, 1882,deals with transfers inter vivos, that is, by a living person whoconveys the property to one or more living persons. The provisionsof Transfer of Property Act are inapplicable to testamentarysuccessions, which are governed by Indian Succession Act, 1925.Whereas a transfer is a conveyance of an existing property byone living person to another. On the other hand, a will is a legalexpression of a wish and intention of a person in regard to hisproperties. When a person makes a will, he provides fortestamentary succession. A will is revocable and comes intooperation only after the death of the testator. Thus, on demise ofthe testator, the will cannot be treated to be a document of transferof an existing property. By execution of a will, no right or title orinterest is created in favour of anyone during the lifetime of thedeceased. Right only flows after the death of testator.

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22. The question arises as to whether any living person can executea document in contravention of any law. The answer is always in negative. If law do not permit and there is a prohibition to docertain thing, or there is a prohibition to do certain act except incertain manner, any document or agreement or anything incontravention to such provision of law, is illegal and invalid. Duringthe lifetime of a living person, if the person is under restriction toexecute certain document and thereby has no right to transfer hisoccupancy or no right to transfer his interest under one or otherAct, he cannot execute any document, including a will showinghis wish and intention in regard to such property in contraventionof such law. Therefore, a tribal even cannot wish nor can showhis intention to transfer his right of occupancy to a tribal or non-tribal, there being restriction Under Section 73AA of the BombayLand Revenue Code. Similarly, a tenant-owner of agricultural landcannot wish nor can show his intention to transfer his right onagricultural land to a non-agriculturist by executing a will incontravention of Section 63 of the Bombay Tenancy Act, exceptin the manner prescribed thereunder. Any such wish and intentionshown by testator during his lifetime, being in contravention oflaw, as noticed above, is invalid and can be ignored.

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24. Therefore, even if it is accepted that the transfer under theTransfer of Property Act is a conveyance of an existing propertyby one living person to another, and will does not involve anytransfer, but if a will is executed in contravention of law, it isalways open to the authority to ignore such will and may refuse tomutate the name on the basis of such will.”

20. The common thread running through these decisions exceptthat in Mahadeo[8 ]is to construe the prohibition against transfer appearingin various statutes in keeping with the legislative intent. As laid down inAmarendra Pratap Singh[24], where the object of the legislation is toprevent a mischief and to confer protection on the weaker sections ofthe society, the court would not hesitate in placing an extended meaning,even a stretched one, on the word, if in doing so the statute would succeedin attaining the object sought to be achieved. We must therefore examinethe provisions of the Act to consider the legislative scheme.

A) In terms of Section 32, on the tillers’ day every tenant satisfyingthe requirements spelt out in Section 32(1), and upto the ceiling AB

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limit as laid down in Section 32A, is deemed to have purchasedfrom his landlord, free from all encumbrances, the land held byhim as tenant.

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B) The purchase price payable by the tenant for such deemedpurchase is to be determined in terms of Section 32H, accordingto which, in case of a permanent tenant the purchase price has tobe equal to six times the rent, while in case of other tenants, thepurchase price would not be less than 20 times the assessment,and not more than 200 times the assessment.

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C) In case the proceedings for eviction of the tenant are pending,the deemed date of purchase will stand postponed in terms of thefirst proviso to Section 32.

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D) Even if the tenant had lost the possession before the tillers’day, in certain cases the possession can be restored to him andthe benefit of statutory purchase can be enjoyed by him as stipulatedDin sub-sections (1A) and (1B) of Section 32. The benefit ofstatutory purchase is also made available to tenants in areas withinthe limits of Municipal Boroughs, or within the limits of MunicipalDistricts as contemplated by Section 32(4) of the Act.

E) If the landlord is under a disability, as stated in Section 32F, theright to purchase the land can be exercised after cessation ofdisability. In such cases, the period within which the right topurchase could be exercised was initially a fixed period, but facilityis given in Section 32F(1A) that even if the period had expired,the tenant is still deemed to have purchased the land.

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F) Even a sub-tenant of a permanent tenant is entitled to the rightof deemed purchase in terms of Section 32I and all the provisionsconcerning deemed purchase are to apply to such sub-tenant.The shares of purchase price are then to be allocated in terms ofSection 32I (3).

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G) If the tenancy is created after the tillers’ day, in terms of Section32O, as it stood before its deletion (vide Gujarat Act No.10 of2009), a tenant could exercise the right of purchase within oneyear from the commencement of his tenancy.

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H) If the purchase has become ineffective or there was failureon the part of the tenant to exercise the right of purchase, the H

Collector under Section 32P either suo motu, or on an application,can pass appropriate directions in terms of Section 32P(2). Insuch cases, the land is to be disposed of to the persons in thepriority list. At the top of the priority list is the tenant himself, incase he is willing to accept the offer of sale, followed by variousentities and persons including agricultural labourers, land-lesspersons, small holders and persons belonging to Scheduled Castesand Scheduled Tribes.

I) If none of those persons in the priority list come forward topurchase the land, the land is to vest in the State Government,whereupon in terms of Section 32P(4) the purchase price can bedetermined, which will then be paid to the owner of the land.

J) Where the purchase in favour of persons from the priority listin terms of Section 32 is effected, the price will be determined interms of Section 32P(5) read with other provisions, to be paid inannual instalments not exceeding six.

K) If any land was surrendered to the landlord before the specifieddate and the possession of the land was taken by the landlord, interms of Section 32P(7), the landlord will be entitled to the useand occupation of the land so long as he cultivates the landpersonally. In such cases, by virtue of Section 32P(8) no land asdescribed in Section 32P(7) can be transferred by sale, mortgage,lease or assignment without the previous sanction of the Collector.

L) Even in cases where the land is at the disposal of the Collectorunder Section 32P, by virtue of Sections 32PP, 32PPP additionalopportunities are granted to the tenant to avail of the benefit ofstatutory purchase. Even where the tenant had failed to depositthe purchase price, in cases covered by Section 32QQ the amountwill be deposited on his behalf by the State Government.

M) Upon payment of the last instalment, a certificate of purchaseis issued to the tenant or sub-tenant or such other person(s)/ entitiesin the priority list, as the case may be. The certificate of purchaseis conclusive evidence of the ownership of such purchaser.

N) A right was conferred upon the tenant with respect to a dwellinghouse under Section 17 whereunder the tenant was given the firstoption of purchasing the site at a value, to be determined by thetribunal. However, by virtue of the newly incorporated Section A

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17B, every tenant is deemed to have purchased from his landlordthe site on which the dwelling house occupied by such tenant isbuilt and the land immediately appurtenant thereto and necessaryfor the enjoyment of dwelling house.

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O) If the landlord intends to sell any land, he must apply to theBtribunal in terms of Section 64 which may thereafter determinethe reasonable price, and the offer has to be made in terms ofSection 32P to the concerned persons.

P) Section 88B had granted exemption from the provisionspertaining to statutory purchase and determination of price inCrespect of lands held by a University or a trust for an educationalpurpose, a hospital, punjarapol or Gaushala and to lands donatedby any person for the purposes of rendering any services to thecommunity. However, in terms of Section 88E, such exemptionceased to operate from the specified date, and the tenants ofsuch lands are also deemed to have purchased the land on theDspecified date, and all the relevant provisions regarding statutorypurchase would then apply to such land.

Q) Section 32R obliges the purchaser of land to cultivate the landpersonally, and in case of failure, the land can be disposed of interms of Section 84C of the Act.

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21. The provisions considered in the preceding paragraph dealwith matters pertaining to and arising out of proceedings related tostatutory purchase. Sections 14 and 29 do not belong to that category. Interms of Section 14, if the land “is assigned” in contravention of Section27, the tenancy of the tenant is liable to be terminated. Section 27 statesFin clear terms that “assignment of any interest” in the land by a tenantshall not be valid. The decision of this Court in Bhavarlal[16 ]has stoodthe test of time which clearly states that a tenancy governed by a statutewhich prohibits assignment, cannot be willed away to a total stranger.The expression “assignment” in Sections 14 and 27, if understood inGlight of the decision of this Court in Bhavarlal[16] which has consistentlybeen followed, must include testamentary disposition.

One thought may be expressed here though that by itself may notbe determinative and that is, the meaning ascribed to the expression“assignment” in Section 43 cannot in any way be different. There isnothing in the provisions of the Act to suggest that the expressionH

“assignment” must carry a different meaning in Sections 14 and 27 onthe one hand, and Section 43 on the other.

22. The provisions analysed hereinabove intend to confer theadvantage of statutory purchase upon a cultivating tenant, and see that“the tiller of the land” is conferred ownership with respect to the landscultivated by him as well as the dwelling house occupied by him. Thus, acultivating tenant, if his holding is otherwise not beyond the ceiling limit,would be given the right to own the land cultivated by him. In caseswhere no purchase could be effected either on account of inability ofthe tenant to pay the purchase price, or on account of other situations,more than one attempt and opportunities are afforded to him. The statutegoes to the extent of obliging the State Government to deposit thepurchase price on his behalf. Even in cases where the tenant is unableto exercise the right of purchase because his holding would go beyondceiling limit, the land would not revert to the landlord, but in terms ofSection 32P, it must come to the persons or entities listed in the prioritylist. The priority list includes persons such as agricultural labourers andlandless persons. The scheme is, therefore, to effectuate distribution ofagricultural lands in such a way that the persons who are disadvantaged,would be conferred the ownership. After such purchase, the law obligesthe purchaser to cultivate the land personally and not to transfer it. Wemay at this stage notice the observations in the majority opinion authoredby K. Ramaswamy, J. under the caption “Agriculture – a means oflivelihood succour for social justice and base for dignity of person”, inSamatha vs. State of A.P. and Others[32] where this Court, inter alia,dealt with the provisions of the Andhra Pradesh Scheduled Areas LandTransfer Regulations, 1989 including the prohibition against transfer.

“9. Agriculture is the main part of the economy and source oflivelihood to the rural Indians and a source and succour for socialstatus and a base for dignity of person. Land is a tangible productand sustaining asset to the agriculturists. In Waman Rao v. Unionof India[33] a Constitution Bench had observed that India being apredominantly agricultural society, there is a “strong linkagebetween the land and the person’s status in social system”. Thestrip of land on which they till and live assures them equal justiceand “dignity of their person by providing to them a near decent 32 (1997) 8 SCC 191

33 (1981) 2 SCC 362 : (1981) 2 SCR 1

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Ameans of livelihood”. Agricultural land is the foundation for a senseof security and freedom from fear. Assured possession is a lastingsource for peace and prosperity.

10. Agriculture is the only source of livelihood for ScheduledTribes, apart from collection and sale of minor forest produce toBsupplement their income. Land is their most important natural andvaluable asset and imperishable endowment from which the tribalsderive their sustenance, social status, economic and social equality,permanent place of abode and work and living. It is a security andsource of economic empowerment. Therefore, the tribes too havegreat emotional attachment to their lands. The land on which theyClive and till, assures them equality of status and dignity of personand means to economic and social justice and is a potent weaponof economic empowerment in social democracy.”

23. If a tenant or any other person from the priority list is conferredownership in respect of the agricultural land or when a landlord is allowedDto retain the land which was surrendered by his tenant, each one ofthem is obliged to cultivate the land personally. In case any of them isunwilling, the land must be given to those who principally depend uponagricultural operations for their sustenance. If a person is a beneficiaryof such statutory purchase and wishes to transfer his holding the lawEobliges that he must take prior sanction from the Collector. While grantingsuch sanction, the authorities may essentially check whether thetransferee is an agriculturist or an agricultural labour who otherwisefulfils the requirements and would carry out the obligation of cultivatingthe land personally; and that his holding would not go beyond the ceilinglimit. Since the ownership itself was conferred as a result of the legislativeFscheme as discussed hereinabove, these conditions are inherent in thevery conferral of ownership and, therefore, specifically incorporated inSection 43 with direct reference to the provisions named therein.

24. A transfer inter vivos would normally be for considerationwhere the transferor may get value for the land but the legislation requiresGprevious sanction of the concerned authority so that the transferee canstep into the shoes of the transferor, and carry out all the obligations asa part of legislative scheme must be discharged. Thus, the screeningwhether a transferee is eligible or not, can be undertaken even beforethe actual transfer is effected. As against this, if a testamentary dispositionHwhich does not have the element of consideration is to be permitted, and if it is assumed that Sections 43 and 63 of the Act do not get attracted,the land can be bequeathed to a total stranger and a non-agriculturistwho may not cultivate the land himself; which in turn may then lead toengagement of somebody as a tenant on the land. The legislative intentto do away with absentee landlordism and to protect the cultivatingtenants, and to establish direct relationship between the cultivator andthe land would then be rendered otiose. The construction put on theexpression “assignment” appearing in Section 43, therefore, has to beconsistent with the legislative scheme. In the context of the entire scheme,the term “assignment” used in Section 43 of the Act must includetestamentary disposition as well. By adopting such construction, inkeeping with the law laid down by this Court, the statute would succeedin attaining the object sought to be achieved. On the other hand, if it isheld that the testamentary disposition would not get covered by theprovisions of Section 43, a gullible person can be made to execute atestament in favour of a person who may not fulfil the requirements andbe eligible to be a transferee in accordance with law. This may not onlyrender the natural heirs of the tenant without any support or sustenance,but may also have serious impact on agricultural operations.

25. In the circumstances the view taken by the Division Bench ofthe High Court in the present matter is absolutely correct and does notcall for any interference. The decision is completely consistent with thelaw laid down by this Court in Sangappa[4 ]and Jayamma[5] and the othercases referred to hereinabove and must be accepted to be the correctexposition of law.

26. This brings us to the last question which was raised byMr. Srivatsa, learned counsel for some of the Appellants. In his submission,any prohibition in the State enactment inconsistent with the principlesemanating from the Central legislation namely Indian Succession Act,1925 must be held to be void. Though, no such contention was raisedbefore the High Court, nor is it reflected in the pleadings, we proceed toconsider the said submission.

27. In Lingappa[20], the challenge was also raised on the groundof legislative competence and the observations of this Court in that behalfwere:-

“25. The submission as regards lack of legislative competence ofthe State to enact the impugned Act which provides by Sections A

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3(1) and 4 for annulment of transfers by tribals to non-tribalseffected during the period from April 1, 1957 to July 6, 1974 stemson a misconception of the nature and content of the legislativepower of the State under Entry 18 in List II which reads:

“18. Land, that is to say, rights in or over land, land tenuresincluding the relation of landlord and tenant, and the collectionof rents; transfer and alienation of agricultural land; landimprovement and agricultural loans; colonization.

The contention advanced fails to take note that the impugned Actstrikes at transactions relating to agricultural lands effectedbetween members of Scheduled Tribes who admittedly belong tothe weaker section of the society and persons not belonging toScheduled Tribes. Experience in the past showed that membersof the Scheduled Tribes had been exploited due to their ignoranceand poverty by members belonging to the affluent and powerfulsections of the society to obtain transfer of their lands by way ofsale, gift, mortgage, exchange etc. for a nominal consideration orfor no consideration at all rendering them practically landless. Itwas also realized that due to their multifarious duties theSub-Divisional Officers and the Collectors had accorded sanctionto such transfers without application of mind to the prevalentcircumstances. It was further felt that the members of ScheduledTribes had become victims of circumstances by reason of theirlands being sold for realization of arrears of land revenue orotherwise under the Maharashtra Co-operative Societies Act, 1960or any other law for the time being in force. Much of the landshad been transferred by members of Scheduled Tribes undercompulsion due to their indebtedness and their lands had passedinto the hands of creditors lending money at an unusually highrate of interest and were thus in a position to dominate the will ofthe borrowers. The Committee appointed by the State Governmentpointed out in its report that the provisions of the MaharashtraLand Revenue Code, 1966 and the relevant tenancy laws had notbeen effective in giving protection to persons belonging to theScheduled Tribes. It recommended inter alia that provision shouldbe made for restoring to possession members of Scheduled Tribesthe lands which had been duly transferred by them to other persons.There is always a presumption when there is a transfer between

a tribal and a non-tribal that it is an unequal bargain. As regardsthe weak and the helpless, the law guards them with a specialprotective care. The Legislature therefore stepped in and reopenedsuch transactions by directing that lands be restored to the tribaltransferors free from all encumbrances on payment by them tothe non-tribal transferees the amounts determined by the Collectorunder sub-section (4) of Section 3. The restoration of possessionby Sections 3(1) and 4 does not involve any deprivation of theproperty in the sense that there is unsettling of title withoutconsideration. It makes detailed provisions setting out the conditionssubject to which a transfer by a tribal of his agricultural lands to anon-tribal may be nullified and possession restored. It also providesfor the legal consequences that must ensue upon restoration ofsuch possession like repayment of the consideration that passedby such tribal transferor to the non-tribal transferee together withhis liability to pay for the costs of improvements, if any, effectedand the giving of an undertaking by the tribal transferor that heneeds the lands for his personal cultivation. It further prescribesthe mode of payment of the amount so determined. The object ofthe legislation is restitution of the property to the persons to whomthe lands originally belonged, subject to the adjustment of equitiesbetween the parties.”

This Court then went on to observe that the Act under challenge,in true nature and character, was a law relating to transfers and alienationsof agricultural lands by members of Scheduled Tribes in the State topersons not belonging to Scheduled Tribes and must necessarily fall withinEntry 18 in List II. This Court observed:- “26. …..The power to legislate cannot be denied to theState on the ground that the provisions of Sections 3(1) and 4which provide for annulment of transfers by tribals incidentallytrench upon the existing law, namely, the Transfer of PropertyAct, 1882 or a law made by Parliament viz. the Specific ReliefAct, 1963. The power of the State Legislature to make a law withrespect to transfer and alienation of agricultural land under Entry18 in List II carries with it not only a power to make a law placingrestrictions on transfers and alienations of such lands including aprohibition thereof, but also the power to make a law to reopensuch transfers and alienations. Such a law was clearly within the A

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Alegislative competence of the State Legislature being relatable toEntry 18 in List II of the Seventh Schedule.”

28. The principles on the point were summed up by this Court inWelfare Association, A.R.P., Maharashtra and Another vs. Ranjit P.Gohil and Others[34] as under:- B

“25. What should be the approach of the Court dealingwith a challenge to the constitutionality of a legislation has beensuccinctly set out in Principles of Statutory Interpretation byJustice G.P. Singh (8th Edn., 2001 at pp. 453-54 and 36). A statuteis construed so as to make it effective and operative on the principleexpressed in the maxim “ut res magis valeat quam pereat”. (Itis better to validate a thing than to invalidate it.) There is apresumption that the legislature does not exceed its jurisdiction.The burden of establishing that the Act is not within the competenceof the legislature, or that it has transgressed other constitutionalmandates, such as those relating to fundamental rights, is alwayson the person who challenges its vires. If a case of violation of aconstitutional provision is made out then the State must justifythat the law can still be protected under a saving provision. Thecourts strongly lean against reducing a statute to a futility. As faras possible, the courts shall act to make a legislation effective andoperative.

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26. In Charanjit Lal Chowdhury v. Union of India[35] theConstitution Bench held that the presumption is always in favourof the constitutionality of an enactment, and the burden is uponhim who attacks it to show that there has been a clear transgressionof the constitutional principles.

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28. The fountain source of legislative power exercised byParliament or the State Legislatures is not Schedule 7; the fountainsource is Article 246 and other provisions of the Constitution. Thefunction of the three lists in the Seventh Schedule is merely todemarcate legislative fields between Parliament and States andnot to confer any legislative power. The several entries mentionedin the three lists are fields of legislation. The Constitution-makers G

34 (2003) 9 SCC 358H35 AIR 1951 SC 41 : 1950 SCR 869

35 AIR 1951 SC 41 : 1950 SCR 869

purposely used general and comprehensive words having a wideimport without trying to particularize. Such construction should beplaced on the entries in the lists as makes them effective; anyconstruction which will result in any of the entries being renderedfutile or otiose must be avoided. That interpretation has invariablybeen countenanced by the constitutional jurists, which gives thewords used in every entry the widest-possible amplitude. Eachgeneral word employed in the entries has been held to carry anextended meaning so as to comprehend all ancillary and subsidiarymatters within the meaning of the entry so long as it can be fairlyaccommodated subject to an overall limitation that the courts cannotextend the field of an entry to such an extent as to result in inclusionof such matters as the framers of the Constitution never intendedto be included within the scope of the entry or so as to transgressinto the field of another entry placed in another list.

29. In every case where the legislative competence of alegislature in regard to a particular enactment is challenged withreference to the entries in the various lists, it is necessary toexamine the pith and substance of the Act and to find out if thematter comes substantially within an item in the list. The expresswords employed in an entry would necessarily include incidentaland ancillary matters so as to make the legislation effective. Thescheme of the Act under scrutiny, its object and purpose, its truenature and character and the pith and substance of the legislationare to be focused at. It is a fundamental principle of constitutionallaw that everything necessary to the exercise of a power is includedin the grant of the power (see the Constitution Bench decision inChaturbhai M. Patel v. Union of India[36]).

30. In Diamond Sugar Mills Ltd. v. State of U.P[37] theConstitution Bench defined the two bounds between which thestream of interpretative process dealing with entries in the SeventhSchedule must confine itself and flow. One bank is the salutaryrule that the words conferring the right of the legislation should beinterpreted liberally and the powers conferred should be given thewidest amplitude; the other bank is guarding against extendingthe meaning of the words beyond their reasonable connotation in

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an anxiety to preserve the power to legislate. The working rule ofthe game is to resolve, as far as possible, in favour of the legislativebody any difficulty or doubt in ascertaining the limits.

31. A note of caution was sounded by the Constitution Benchin Synthetics & Chemicals Ltd. v. State of U.P.[38]. TheConstitution must not be construed in any narrow or pedantic senseand that construction which is most beneficial to the widest-possibleamplitude of its power must be adopted. An exclusionary clausein any of the entries should be strictly and, therefore, narrowlyconstrued. No entry should be so read as to rob it of its entirecontent. A broad and liberal spirit should inspire those whose dutyit is to interpret the Constitution. The Constitution is a living andorganic thing and must adapt itself to the changing situations andpattern in which it has to be interpreted. To bring any particularenactment within the purview of any legislative power, it is thepith and substance of the legislation in question that has to belooked into by giving the widest amplitude to the language of theentries. The Constitution must be interpreted in the light of theexperience gathered. It has to be flexible and dynamic so that itadapts itself to the changing conditions in a pragmatic way. Theundisputed constitutional goals should be permitted to be achievedby placing an appropriate interpretation on the entries. TheConstitution has the greatest claim to live. The claim ought not tobe throttled. The directive principles of State policy can serve asa potent and useful guide for resolving the doubts and upholdingthe constitutional validity of any legislation, if doubted.

32. In United Provinces v. Atiqa Begum[39] Their Lordshipsupheld the principle that the question whether any impugned Actis within any of the three lists, or in none at all, is to be answeredby considering the Act as a whole and deciding whether in pithand substance the Act is with respect to particular categories ornot and held that in doing so the relevant factors are: (i) the designand the purport of the act, both as disclosed by its language, and(ii) the effect which it would have in its actual operation.

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34. The Constitution Bench decision of this Court in InduBhushan Bose v. Rama Sundari Debi[40] needs a special mention.A rent control legislation enacted by the State Legislature wassought to be extended to the cantonment area. The High Courtheld that the same was not permissible inasmuch as so far as thecantonment area is concerned, legislation touching regulation ofhouse accommodation is governed by Entry 3 of List I whichreads, inter alia, “the regulation of house accommodation(including the control of rents) in such areas” i.e. cantonmentareas. During the course of its judgment, the Constitution Benchheld that the entry has to be liberally and widely interpreted.Regulation of houses in private occupation would fall within theentry. The word “regulation” includes power to direct or controlall housing accommodation in cantonment areas, which in its turn,will include within it all aspects as to who is to make theconstruction, under what conditions the constructions can bealtered, who is to occupy the accommodation and for how long,on what terms it is to be occupied, when and under whatcircumstances the occupant is to cease to occupy it, and themanner in which the accommodation is to be utilized. All theseare ingredients of regulation of house accommodation in its widesense. Parliament could legislate in respect of houseaccommodations in cantonment areas in all its aspects, includingregulation of grant of leases, ejectment of lessees and ensuringthat the accommodation is available on proper terms as to rents.The power of the State Legislature to legislate in respect oflandlord and tenant of buildings is to be found in Entries 6, 7 and13 of List III of the Seventh Schedule to the Constitution and notin Entry 18 of List II, and that power was circumscribed by theexclusive power of Parliament to legislate on the same subjectunder Entry 3 of List I.

35. Before the Constitution Bench in Indu Bhushan Bose[40]the English decisions in Prout v. Hunter[41], Property HoldingCo. Ltd. v. Clark[42] and Curl v. Angelo[43] were cited with approval.In Prout v. Hunter[41] the Rent Restrictions Act was held to have 40 (1969) 2 SCC 289 : (1970) 1 SCR 443

41 (1924) 2 KB 736 : 1924 AII ER Rep 53 : 132 LT 193 (CA)

42 (1948) 1 KB 630 : (1948) 1 AII ER 165 (CA)

43 (1948) 2 AII ER 189 (CA)

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been passed by Parliament with the two fold object: (i) of preventingthe rent from being raised above the pre-war standard, and (ii) ofpreventing tenants from being turned out of their houses even ifthe term for which they had originally taken them had expired. InProperty Holding Co. Ltd. v. Clark[42 ]the objects of policyunderlying rent restriction legislations were stated to be: (i) toprotect the tenant from eviction from the house where he is living,except for defined reasons and on defined conditions; and (ii) toprotect him from having to pay more than a fair rent. The latterobject is achieved by the provisions for standard rent with (a)only permitted increases, (b) the provisions about furniture andattendance, and (c) the provisions about transfers of burdens andliabilities from the landlord to the tenant which would undermineor nullify the standard rent provisions. Such acts operate in remupon the house and confer on the house itself the quality of ensuringto the tenant a status of irremovability. Tenants’ security of tenureis one of the distinguishing characteristics conferred by the statuteupon the house. In Curl v. Angelo[43 ]Lord Greene, M.R., dealingwith the Rent Restrictions Act, held that the overriding purposeand intention of such Acts are to protect the person residing in adwelling house from being turned out of his home. In the opinionof the Constitution Bench these cases are a pointer to the principlethat rent control legislations can be effective and purposeful onlyif they also regulate eviction of tenants. Regulation of houseaccommodation, therefore, includes within its sweep the powerto regulate eviction of tenants.

37. There is yet another angle of looking at the issue. InLingappa Pochanna Appelwar v. State of Maharashtra[20] theprovisions of the Maharashtra Restoration of Lands to ScheduledTribes Act, 1975 came up for consideration which Act related totransfers and alienation of agricultural lands by members ofScheduled Tribes in the State to persons not belonging to ScheduledTribes. The legislation fell in Entry 18 in List II. Certain provisionsof the Act trenched upon the existing law, namely, the Transfer ofProperty Act and the Specific Relief Act, both made by Parliament.It was held that the power of the State Legislature to make a lawwith respect to transfer and alienation of agricultural land carries with it not only a power to make a law placing restrictions ontransfers and alienations of such lands including a prohibitionthereof, but also the power to make a law to reopen such transfersand alienations. The legislative competence was spelt out fromEntry 18 in List II of Schedule 7. The Court observed: (SCC p.493, para 16)

“16. The present legislation is a typical illustration of the conceptof distributive justice, as modern jurisprudents know it.Legislators, Judges and administrators are now familiar withthe concept of distributive justice. Our Constitution permitsand even directs the State to administer what may be termed‘distributive justice’. The concept of distributive justice in thesphere of law-making connotes, inter alia, the removal ofeconomic inequalities and rectifying the injustice resulting fromdealings or transactions between unequals in society. Lawshould be used as an instrument of distributive justice toachieve a fair division of wealth among the members ofsociety based upon the principle: ‘From each accordingto his capacity, to each according to his needs.’ Distributivejustice comprehends more than achieving lessening ofinequalities by differential taxation, giving debt relief ordistribution of property owned by one to many who have noneby imposing ceiling on holdings, both agricultural and urban, orby direct regulation of contractual transactions by forbiddingcertain transactions and, perhaps, by requiring others. It alsomeans that those who have been deprived of their propertiesby unconscionable bargains should be restored their property.All such laws may take the form of forced redistribution ofwealth as a means of achieving a fair division of materialresources among the members of society or there may belegislative control of unfair agreements.”

38. In Maneklal Chhotalal v. M.G. Makwana[44] theconstitutional validity of the Bombay Town Planning Act, 1954 asamended by Gujarat Act 52 of 1963 was put in issue. The legislationfell within Entry 18 of List II. The Court also held after elaboratelyreferring to the various provisions contained in the Act that it waspassed with a view to regulate the development of certain areas

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Awith the general object of framing proper schemes for the healthyand orderly development of the area in question and it is with aview to achieve this purpose that a very elaborate procedure andmachinery have been prescribed under the Act. For this reason itwas held that the competency of the State legislation aimed atequitable distribution of landed property resulting in partialBdeprivation of proprietary rights can also be rested under Entry20 of List III which is “economic and social planning”.

29. The validity of Sections 13 to 16 of the Maharashtra Controlof Organised Crime Act, 1999 was struck down by the Bombay HighCourt as being beyond the legislative competence of the State Legislature.CWhile upholding the validity, this Court re-stated the principles in Stateof Maharashtra vs. Bharat Shanti Lal Shah and Others[45 ]as under:-

“37. It is a well-established rule of interpretation that the entriesin the List being fields of legislation must receive liberalconstruction inspired by a broad and generous spirit and not in aDnarrow pedantic sense. Each general word should extend to allancillary and subsidiary matters which can fairly and reasonablybe comprehended within it.

38. In Navinchandra Mafatlal v. CIT[46] this Court observed asunder: (AIR p. 61, para 6)

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“6. … As pointed out by Gwyer, C.J. in United Provinces v.Atiqa Begum[39], FCR at p. 134 none of the items in the Lists isto be read in a narrow or restricted sense and that each generalword should be held to extend to all ancillary or subsidiarymatters which can fairly and reasonably be said to beFcomprehended in it. It is, therefore, clear—and it isacknowledged by Chief Justice Chagla—that in construing anentry in a List conferring legislative powers the widest possibleconstruction according to their ordinary meaning must be putupon the words used therein … The cardinal rule ofGinterpretation, however, is that words should be read in theirordinary, natural and grammatical meaning subject to this riderthat in construing words in a constitutional enactment conferringlegislative power the most liberal construction should be put 45 (2008) 13 SCC 5H46 AIR 1955 SC 58

upon the words so that the same may have effect in their widestamplitude.”

39. Similar were the observations of a five-Judge Bench of thisCourt in Godfrey Phillips India Ltd. v. State of U.P[47], whichare as follows: (SCC p. 541, paras 49-50)

“49. … Where there is the possibility of legislative overlap,courts have resolved the issue according to settled principlesof construction of entries in the Legislative Lists.

50. The first of such settled principles is that legislative entriesshould be liberally interpreted, that none of the items in the Listis to be read in a narrow or restricted sense and that eachgeneral word should be held to extend to ancillary or subsidiarymatters which can fairly and reasonably be said to becomprehended in it (United Provinces v. Atiqa Begum[39],Western India Theatres Ltd. v. Cantonment Board[48], SCRat p. 69 and Elel Hotels & Investments Ltd. v. Union ofIndia[49]).”

40. It is also a cardinal rule of interpretation that there shall alwaysbe a presumption of constitutionality in favour of a statute andwhile construing such statute every legally permissible effort shouldbe made to keep the statute within the competence of the StateLegislature. In Burrakur Coal Co. Ltd. v. Union of India[50] thisCourt held the same in the following manner: (AIR p. 963, para25)

“25. … Where the validity of a law made by a competentlegislature is challenged in a court of law that court is bound topresume in favour of its validity. Further while considering thevalidity of the law the court will not consider itself restricted tothe pleadings of the State and would be free to satisfy itselfwhether under any provision of the Constitution the law canbe sustained.”

41. In CST v. Radhakrishan[51] this Court while dealing with thequestion of constitutional validity of a statute held that the 47 (2005) 2 SCC 515

48 AIR 1959 SC 582 : 1959 Supp (2) SCR 63

49 (1989) 3 SCC 698

51 (1979) 2 SCC 249 : 1979 SCC (Tax) 108

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presumption is always on the constitutionality and the burden isupon the person who attacks it to show that there has beentransgression of constitutional principles. It was held in that decisionthat for sustaining the constitutionality of an Act, a court may takeinto consideration matters of common knowledge, reports,Preamble, history of the times, object of the legislation and allother facts which are relevant and that it must always be presumedthat the legislature understands and correctly appreciates the needof its own people and that discrimination, if any, is based onadequate grounds and considerations.

42. In this regard we may also refer to a three-Judge Benchdecision of this Court titled Greater Bombay Coop. Bank Ltd.v. United Yarn Tex (P) Ltd.[52] In the said decision one of theissues that was raised was “whether the State Legislature iscompetent to enact legislation in respect of cooperative societiesincidentally transacting business of banking, in the light of Entry32, List II of the Seventh Schedule of the Constitution”. Whiledeciding the said issue reference was made and reliance wasplaced on the following passage contained in the earlier decisionof this Court in State of Bihar v. Bihar Distillery Ltd.[53] aboutthe nature of approach which the court should adopt whileexamining the constitutional validity of a provision (vide para 85of United Yarn case[52]): (Bihar Distillery Ltd[53], SCC p. 466,para 17)

“17. … The approach of the court, while examining thechallenge to the constitutionality of an enactment, is to startwith the presumption of constitutionality. The court should tryto sustain its validity to the extent possible. It should strikedown the enactment only when it is not possible to sustain it.The court should not approach the enactment with a view topick holes or to search for defects of drafting, much lessinexactitude of language employed. Indeed, any such defectsof drafting should be ignored out as part of the attempt to sustainthe validity/constitutionality of the enactment. After all, an Actmade by the legislature represents the will of the people andthat cannot be lightly interfered with. The unconstitutionality 52 (2007) 6 SCC 236H53 (1997) 2 SCC 453

must be plainly and clearly established before an enactment isdeclared as void. The same approach holds good whileascertaining the intent and purpose of an enactment or its scopeand application. … The court must recognise the fundamentalnature and importance of legislative process and accord dueregard and deference to it, just as the legislature and theexecutive are expected to show due regard and deference tothe judiciary. It cannot also be forgotten that our Constitutionrecognises and gives effect to the concept of equality betweenthe three wings of the State and the concept of ‘checks andbalances’ inherent in such scheme.”

43. One of the proven methods of examining the legislativecompetence of an enactment is by the application of doctrine ofpith and substance. This doctrine is applied when the legislativecompetence of the legislature with regard to a particular enactmentis challenged with reference to the entries in various lists. If thereis a challenge to the legislative competence the courts will try toascertain the pith and substance of such enactment on a scrutinyof the Act in question. In this process, it is necessary for thecourts to go into and examine the true character of the enactment,its object, its scope and effect to find out whether the enactmentin question is genuinely referable to the field of legislation allottedto the respective legislature under the constitutional scheme. Thesaid doctrine has come to be established in India and is recognisedin various pronouncements of this Court as also of the High Courts.Where a challenge is made to the constitutional validity of aparticular State Act with reference to a subject mentioned in anyentry in List I, the court has to look to the substance of the StateAct and on such analysis and examination, if it is found that in thepith and substance, it falls under an entry in the State List butthere is only an incidental encroachment on topics in the UnionList, the State Act would not become invalid merely because thereis incidental encroachment on any of the topics in the Union List.

44. A five-Judge Bench of this Court in A.S. Krishna v. State ofMadras[54] held as under: (AIR p. 301, para 8)

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A“8. … But then, it must be remembered that we are construinga federal Constitution. It is of the essence of such a Constitutionthat there should be a distribution of the legislative powers ofthe Federation between the Centre and the Provinces. Thescheme of distribution has varied with different Constitutions,but even when the Constitution enumerates elaborately theBtopics on which the Centre and the States could legislate, someoverlapping of the fields of legislation is inevitable. The BritishNorth America Act, 1867, which established a federalConstitution for Canada, enumerated in Sections 91 and 92 thetopics on which the Dominion and the Provinces couldCrespectively legislate. Notwithstanding that the lists wereframed so as to be fairly full and comprehensive, it was notlong before it was found that the topics enumerated in the twosections overlapped, and the Privy Council had time and againto pass on the constitutionality of laws made by the Dominionand Provincial Legislatures. It was in this situation that theDPrivy Council evolved the doctrine, that for deciding whetheran impugned legislation was intra vires, regard must be had toits pith and substance. That is to say, if a statute is found insubstance to relate to a topic within the competence of thelegislature, it should be held to be intra vires, even though itEmight incidentally trench on topics not within its legislativecompetence. The extent of the encroachment on mattersbeyond its competence may be an element in determiningwhether the legislation is colourable, that is, whether in theguise of making a law on a matter within it competence, thelegislature is, in truth, making a law on a subject beyond itsFcompetence. But where that is not the position, then the factof encroachment does not affect the vires of the law even asregards the area of encroachment.”

45. Again a five-Judge Bench of this Court while discussing thesaid doctrine in Kartar Singh v. State of Punjab[55] observed asGunder: (SCC p. 630, para 60)

“60. This doctrine of ‘pith and substance’ is applied when thelegislative competence of a legislature with regard to a H55 (1994) 3 SCC 569 : 1994 SCC (Cri) 899

particular enactment is challenged with reference to the entriesin the various lists i.e. a law dealing with the subject in one listis also touching on a subject in another list. In such a case,what has to be ascertained is the pith and substance of theenactment. On a scrutiny of the Act in question, if found, thatthe legislation is in substance one on a matter assigned to thelegislature enacting that statute, then that Act as a whole mustbe held to be valid notwithstanding any incidental trenchingupon matters beyond its competence i.e. on a matter includedin the list belonging to the other legislature. To say differently,incidental encroachment is not altogether forbidden.”

46. Though it is true that the State Legislature would not havepower to legislate upon any of the matters enumerated in theUnion List but as per the doctrine of pith and substance therecould not be any dispute with regard to the fact that if it could beshown that the area and subject of the legislation is also coveredwithin the purview of the entry of the State List and the ConcurrentList, in that event incidental encroachment to an entry in the UnionList will not make a law invalid and such an incidentalencroachment will not make the legislation ultra vires theConstitution.”

30. In Girnar Traders (3) vs State of Maharashtra and Others[56],the Constitution Bench of this Court was called upon to consider, interalia, the competence of the State Legislature to enact certain provisionsof the Maharashtra Regional and Town Planning Act, 1966, stated to bein conflict with Section 11A of the Land Acquisition Act, 1894, a CentralLegislation. While rejecting the submission, this Court observed: - “183. We have already discussed in great detail that the StateAct being a code in itself can take within its ambit provisions ofthe Central Act related to acquisition, while excluding the provisionswhich offend and frustrate the object of the State Act. It will notbe necessary to create, or read into the legislations, an imaginaryconflict or repugnancy between the two legislations, particularly,when they can be enforced in their respective fields withoutconflict. Even if they are examined from the point of view thatrepugnancy is implied between Section 11-A of the Land AB

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Acquisition Act and Sections 126 and 127 of the MRTP Act, thenin our considered view, they would fall within the permissible limitsof doctrine of “incidental encroachment” without rendering anypart of the State law invalid.

184. Once the doctrine of pith and substance is applied tothe facts of the present case, it is more than clear that in substancethe State Act is aimed at planned development unlike the CentralAct where the object is to acquire land and disburse compensationin accordance with law. Paramount purpose and object of theState Act being planned development and acquisition beingincidental thereto, the question of repugnancy does not arise. TheState, in terms of Entry 5 of List II of Schedule VII, is competentto enact such a law. It is a settled canon of law that courts normallywould make every effort to save the legislation and resolve theconflict/repugnancy, if any, rather than invalidating the statute.Therefore, it will be the purposive approach to permit both theenactments to operate in their own fields by applying themharmoniously. Thus, in our view, the ground of repugnancy raisedby the appellants, in the present appeals, merits rejection.

185. A self-contained code is an exception to the rule ofreferential legislation. The various legal concepts covering therelevant issues have been discussed by us in detail above. Theschemes of the MRTP Act and the Land Acquisition Act do notadmit any conflict or repugnancy in their implementation. Theslight overlapping would not take the colour of repugnancy. Insuch cases, the doctrine of pith and substance would squarely beapplicable and rigours of Article 254(1) would not be attracted.Besides that, the reference is limited to specific provisions of theLand Acquisition Act, in the State Act. Unambiguous language ofthe provisions of the MRTP Act and the legislative intent clearlymandates that it is a case of legislation by incorporation incontradistinction to legislation by reference.

186. Only those provisions of the Central Act whichprecisely apply to acquisition of land, determination anddisbursement of compensation in accordance with law, can beread into the State Act. But with the specific exceptions that theprovisions of the Central Act relating to default and consequencesthereof, including lapsing of acquisition proceedings, cannot be read into the State Act. It is for the reason that neither have theybeen specifically incorporated into the State law nor can they beabsorbed objectively into that statute. If such provisions (Section11-A being one of such sections) are read as part of the Stateenactment, they are bound to produce undesirable results as theywould destroy the very essence, object and purpose of the MRTPAct.

187. Even if fractional overlapping is accepted betweenthe two statutes, then it will be saved by the doctrine of incidentalencroachment, and it shall also be inconsequential as both theconstituents have enacted the respective laws within theirlegislative competence and, moreover, both the statutes caneloquently co-exist and operate with compatibility. It will be inconsonance with the established canons of law to tilt the balancein favour of the legislation rather than invalidating the same,particularly, when the Central and State law can be enforcedsymbiotically to achieve the ultimate goal of planned development.”

31. If the provisions referred to in Section 43 of the Act and alliedprovisions are considered in light of the settled principles extracted earlier,it emerges that the primary concern of those provisions is to see that thelegislative scheme of granting protection to persons from disadvantagedcategories and conferring the right of purchase upon them, and therebyensure direct relationship of a tiller with the land. The provisions, thoughlay down a norm which may not be fully consistent with the principles ofIndian Succession Act, are principally designed to attain and sub-servethe purpose of protecting the holdings in the hands of disadvantagedcategories. The prohibition against transfers of holding without theprevious sanction of the concerned authorities, is to be seen in that lightas furthering the cause of legislation. Even if by the process ofconstruction, the expression “assignment” is construed to includetestamentary disposition, in keeping with the settled principles, theincidental encroachment cannot render the said provisions invalid. Inpith and substance, the legislation and the concerned provisions arecompletely within the competence of the State Legislature and by placingthe construction upon the expression “assignment” to include testamentarydisposition, no transgression will ensue.

32. We, therefore, reject the submissions advanced by Mr. Srivatsa,learned Counsel.

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A33. In the premises, we accept the construction put by the DivisionBench on the provisions that fell for consideration. The challenge to theview taken by the Division Bench must therefore be rejected. We mustalso observe that the decision of this Court in Mahadeo[8 ]which hadfailed to notice the earlier decisions in Sangappa[4 ]and Jayamma[5 ]andwhich is inconsistent with the decisions referred to hereinabove andBwhat we have concluded, must be held to be incorrectly decided.

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34. Accordingly, all these appeals are dismissed without any orderas to costs.

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Appeals dismissed.

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