Banwari Lal (Deceased) Through Lrs vs Unknown on 22 March, 2011

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Punjab-Haryana High Court

Banwari Lal (Deceased) Through Lrs vs Unknown on 22 March, 2011

The petitioner had approached this court by filing the present petition challenging the order dated 6.8.1986 (Annexure P3) passed by Joint Secretary (Rehabilitation)-cum- Settlement Commissioner, Haryana (hereinafter referred to as `the Settlement Commissioner') and notice dated 28.8.1986 (Annexure-P5) sent to the petitioner and respondent No. 3 in pursuance of the order passed by the Settlement Commissioner.

Briefly, the pleaded facts are that the land bearing khasra No. 434/16/1, 25/2 and 437/22/2, 23, 24 and 25, measuring 26 kanals and 9 marlas, situated in Mauja Hansi, Tehsil Hansi, District Hissar was surplus evacuee land, which had been transferred to the State Government in Package Deal. This kind of land was to be disposed of by way of auction for allotment. The State Government framed rules for the purpose, known as the Rules for the Sale of Surplus Rural Evacuee Properties (for short, `the Rules'). The land in question was put to auction in terms of the aforesaid Rules on 5.8.1969. Respondent No. 3 was the highest bidder for a sum of ` 2,000/-. The aforesaid bid was confirmed by the Settlement Officer (Sale) C.W.P. No. 4968 of 1986 [ 2] on 12.9.1969. The entire sale consideration was deposited by respondent No. 3 on 9.2.1970. Thereafter, even a sale certificate was also issued in his favour. The transfer was effected in the revenue record by mutation (Annexure-P1). On 6.2.1978, the petitioner purchased the aforesaid land from respondent No. 3 on payment of ` 10,000/-, which was the market value at that time. After purchasing the land, the petitioner spent ` 20,000/- in making the same cultivable and also arranging the water course. On 9.8.1984, a notice was issued to the petitioner for appearance on 21.9.1984. Vide order dated 6.8.1986 (Annexure-P3), the Settlement Commissioner set aside the auction of the land in favour of respondent No. 3 and directed for its re-auction. It is against this order that the petitioner, who is a subsequent buyer of the land from respondent No. 3, is before this court.

Learned counsel for the petitioner, placing reliance upon an order dated 4.11.1982 passed by this court in C.W.P. No. 832 of 1975-- Roshan Lal v. The State of Haryana and others; Mohinder Singh v. Deputy Commissioner-cum-Chief Sales Commissioner, Ludhiana, 1996(2) Recent Revenue Reports 246; Jaswant Kaur v. Deputy Commissioner-cum-Chief Sales Commissioner, Ludhiana, 1996(2) Recent Revenue Reports 392 and Thakar Singh v. State of Punjab, (2009-3) Punjab Law Reporter 125, submitted that sale of land in the present case was effected in an auction, which was held on 5.8.1969. The same was confirmed by the Settlement Officer (Sale) on 12.9.1969. On payment of the entire auction price, even the sale certificate was also issued in favour of respondent No. 3 on 9.2.1970. To cancel the auction after 16 years of even issuance of sale certificate is totally arbitrary. The provisions of the Rules, under which the auction was conducted, do not permit the same. There is no fault on the part of the petitioner. All what is pointed out in the order passed by the Settlement Commissioner is that the reserve price of the property was wrongly fixed at a lower rate and further that the land situated at two different locations was clubbed together. The order was passed by the Settlement Commissioner on a reference made to him by the Deputy District Attorney, Rehabilitation Department, Haryana. The petitioner or his vendor having not been at fault or in connivance with the officials should not be C.W.P. No. 4968 of 1986 [ 3] made to suffer for any alleged irregularity at their end. Even otherwise, the action of re-calling of an order setting aside the auction sale, which was effected 17 years prior thereto is also arbitrary and inequitable. Even if there is no period prescribed for exercise of power under Rule 11 of the Rules, still the same has to be within reasonable time.

On the other hand, learned counsel for respondents No. 1 and 2 submitted that reference had to be made for taking suo-motu action under Rule 11 of the Rules for the reason that reserve price of the property was fixed in the year 1967. The auction was held in the year 1969 and in between fresh instructions had been issued in the year 1968. In terms of these instructions, the reserve price of the land had to be ` 2,596/-, whereas it was sold merely for ` 2,000/-, i.e., below the reserve price. He further submitted that two portions of land located at a difference place were clubbed for the purpose of auction. One of the portions could very well be used for residential and commercial purposes. The clubbing was totally illegal. He further submitted that the Rules do not provide for any time limit for taking suo-motu action further, there being patent illegality/irregularity in the auction of the land on account of which the State suffered loss, corrective steps could be taken at any time. It is for this purpose only that the authorities are conferred with suo-motu power to be exercised in a given case, where it is required.

Heard learned counsel for the parties and perused the paper book.

Rule 5 of the Rules provides for procedure for sale of property by way of public auction. Rule 8 provides that when the purchase money has been paid in full by the purchaser, he would be issued a sale certificate which shall entitle him to take possession of the property sold to him. In the present case, the undisputed facts on record that auction of the property had taken place on 5.8.1969, which was confirmed by Settlement Officer (Sale) on 12.9.1969 and after payment of the entire auction price, a sale certificate was also issued in favour of respondent No. 3, vendor of the petitioner. Rule 9 of the Rules enables any person to move a complaint to the authorised officer against the confirmation of sale because of any alleged irregularity C.W.P. No. 4968 of 1986 [ 4] or fraud in the conduct of sale. It provides that such an application shall be filed within 10 days of said auction and the applicant is required to deposit a sum equivalent to highest bid plus 20% as earnest money with an undertaking to buy the property at the fixed rate, in case the property could not be sold in re-auction at the higher price. The sale shall not be approved till the decision of the application. If after consideration of the facts stated in the application, the authorised officer is satisfied that any material irregularity or fraud has been committed in publication or conduct of sale, he may withhold approval and make an order for re-auction of the land.

Rule 11 of the Rules provides for power of revision. It confers power on the Settlement Commissioner to call for the record of any case pending before or decided by a Subordinate Officer and pass such order as may be deemed fit, after affording opportunity of hearing to the persons effected. The same is extracted hereunder:

"Powers of Revision. Settlement Commissioner may call for the record of any case pending before or decided by a Subordinate Officer and pass such order as may be deemed fit including the resumption of property, provided that the party affected by the proposed order shall be given an opportunity of being heard."

In the present case, there was no complaint filed by any person in terms of Rule 9 of the Rules, as referred to above. The sale had already been confirmed and sale certificate was issued in favour of the successful bidder on 9.2.1970. Even the mutation had also been entered in the revenue record and possession of the property delivered to the buyer.

It is evident from the impugned order that after the confirmation of sale on 9.2.1970, a reference was sent for setting aside the sale on 17.12.1973. At that time, the Deputy Secretary (Rehabilitation) vide order dated 31.10.1974 asked the department to submit a complete reference. Thereafter, the department slept over the matter and a fresh reference was made nearly after a decade on 21.2.1984. On a consideration of the subsequent reference, the Settlement Commissioner opining that there was gross negligence and irregularity in the conduct of auction proceedings C.W.P. No. 4968 of 1986 [ 5] with possibility of connivance at that level, set aside the auction proceedings.

The issue under consideration before this court is as to whether in exercise of revisional power, sale effected 16 years back could be set aside.

In Roshan Lal's case (supra), sale of land in an auction was set aside by the Settlement Commissioner on the ground that reserve price of the land had been wrongly assessed at lower rate. In a challenge to that order in a writ petition, the same was set aside. In the judgments of this Court in Jaswant Kaur; Mohinder Singh and Thakar Singh's cases (supra), the issue under consideration was regarding sale of property under the Punjab Package Deal Properties (Disposal) Act, 1976, where Section 10(2) provides that any transfer of property could be set aside if it is found that the same had been obtained by him by means of fraud, false representation or concealment of any material fact. The language of Rule 11 of the Rules in the present case providing for suo-motu exercise of power by the Settlement Commissioner is not similar to Section 10(2) of the aforesaid Act, hence, the judgments will not be applicable.

The only argument which, in my view is meritorious in the present case is the inordinate delay in exercise of suo-motu power by the Settlement Commissioner. The undisputed facts are that auction of the land had taken place on 5.8.1969, which was confirmed by the competent authority on 12.9.1969 on payment of entire amount of sale consideration. The sale certificate was issued in favour of the successful bidder on 9.2.1970. The issue regarding alleged under valuation of the reserve price of the land sold had come to the notice of the department concerned when a reference was made to the Settlement Commissioner for suo-motu exercise of power on 17.12.1973, which was returned by him on 31.10.1974 for submission of a complete reference. Thereafter, for about a decade the department kept quiet and slept over the matter. Fresh reference was sent only on 21.2.1984. The impugned order was passed on 6.8.1986.

Even in a statute, where no period of limitation is provided for taking any action, still it has to be reasonable and not that such a power C.W.P. No. 4968 of 1986 [ 6] could be exercised at any time. Finality has to be attached to the actions.

The issue regarding reasonable time was considered by Hon'ble the Supreme Court in State of Gujarat v. Patel Raghav Natha and others, AIR 1969 SC 1297, wherein it was observed as under:

"11. The question arises whether the Commissioner can revise an order made under Section 65 at any time. It is true that there is no period of limitation prescribed under Section 211 but it seems to us plain that this power must be exercised in reasonable time and the length of reasonable time must be determined by the facts of the case and the nature of the order which is being revised.

12. It seems to us that Section 65 itself indicates the length of the reasonable time within which the Commissioner must act under Section 211 under Section 65 of the Code, if the Collector does not inform the applicant of his decision on the application within a period of three months, the permission applied for shall be deemed to have been granted. This Section shows that a period of three months is considered ample for the Collector to make up his mind and beyond that the Legislature thinks that the matter is so urgent that permission shall be deemed to have been granted. Regarding Sections 211 and 65 together, it seems to us that the Commissioner must exercise his revisional powers within a few months of the order of Collector. This is reasonable time because after the grant of the permission for building purposes, the occupant is likely to spend money on starting building operations at least within a few months from the date of the permission. In this case, the Commissioner set aside the orders of the Collector on October 12, 1961 i.e. More than a year after the order, and it seems to us that this order was passed too late."

In Ibrahimpatnam Taluk Vyavasaya Colliee Sangham v. K. Suresh Reddy and others, AIR 2003 SC 3592, Hon'ble the Supreme Court C.W.P. No. 4968 of 1986 [ 7] held as under:

"9.... Use of the words "at any time" in sub-section (4) of Section 50-B of the Act only indicates that no specific period of limitation is prescribed within which suo-motu power could be exercised reckoning or starting from a particular date advisedly and contextually. Exercise of suo-motu power depended on facts and circumstances of each case. In cases of fraud, this power could be exercised within a reasonable time from the date of detection or discovery of fraud. While exercising such power, several factors need to be kept in mind such as effect on the rights of the third parties over the immovable property due to passage of considerable time, change of hands by subsequent bona fide transfers, the orders attaining finality under the provisions of other Acts (such as Land Ceiling Act). Hence it appears without stating from what date the period of limitation starts and with what period the suo-motu powers is to be exercised. In sub-section (4) of Section 50-B of the Act, the words "at any time" are used so that the suo-motu powers could be exercised within a reasonable period from the date of discovery of fraud depending on facts and circumstances of each case in the context of the statute and nature of rights of parties. Use of the words "at any time" in sub-section (4) of Section 50-B of the Act cannot be rigidly read letter by letter. It must be read and construed contextually and reasonably. If one has to simply proceed on the basis of dictionary meaning of words "at any time", the suo-motu power under Sub-Section (4) of Section 50-B of the Act could be exercised even after decades and then it would lead to anomalous position leading to uncertainty and complications seriously affecting the rights of the parties, that too, over immovable properties. Orders attaining finality and certainty of the rights of the parties accrued in the light of the orders passed must have sanctity. Exercise of suo-motu power C.W.P. No. 4968 of 1986 [ 8] "at any time" only means that no specific period such as days, months or years are not prescribed reckoning from a particular date. But that does not mean that "at any time" should be unguided and arbitrary. In this view, "at any time" must be understood as within a reasonable time depending on the facts and circumstances of each case in the absence of prescribed period of limitation.

10. This court in a recent decision in D. Saibaba v. Bar Council of India and another, (2003) 6 SCC 186 after referring and quoting passage from Justice GP Singh's Principles of Statutory interpretation observed that "Reading word for word and assigning a literal meaning to Section 48-AA would lead to absurdity, futility and to such consequences as Parliament could have never intended. The provision has an ambiguity and is capable of being read in more ways than one. We must, therefore, assign the provision a meaning and so read it - as would give life to an otherwise lifeless letter and enable the power of review conferred thereby being meaningfully availed and effectively exercised."

11. In Principles of Statutory Interpretation (8th Edn. 2001), the author has stated thus:

"It may look somewhat paradoxical that plain meaning rule is not plain and requires some explanation. The rule, that plain words require no construction, starts with the premise that the words are plain, which is itself a conclusion reached after construing the words. It is not possible to decide whether certain words are plain or ambiguous unless they are studied in their context and construed."

The author has stated again as under:

"In selecting out of different interpretations, the court will adopt that which is just, reasonable and sensible rather than that which is none of those things, as it may be presumed that the Legislature should have used the word in that interpretation C.W.P. No. 4968 of 1986 [ 9] which at least offends our sense of justice."

12. The learned Single Judge has referred to and relied on various decisions including the decisions of this court as to how the use of words `at any time' in Sub-Section (4) of Section 50-B of the Act should be understood. In the impugned order, the Division Bench the High Court approves and affirms the decision of the learned Single Judge. Where a statute provides any suo-motu power of revision without prescribing any period of limitation, the power must be exercised within a reasonable time and what is "reasonable time" has to be determined on the facts of each case."

In State of HP and others v. Rajkumar Brijender Singh and others, AIR 2004 SC 3218, Hon'ble the Supreme Court opined as under:

"6. .....It is true that sub-section (3) provides that such a power may be, exercised at any time but this expression does not mean there would be no time limit or it is in infinity. All that is meant is that such powers should be exercised within a reasonable time. No fix period of limitation may be laid but unreasonable delay in exercise of power would tend to undo the things which have attained finality. It depends on the facts and circumstances of each case as to what is the reasonable time within which the power suo-motu action could be exercised. For example, in this case, as the appeal had been withdrawn but the Financial Commissioner had taken up the matter in exercise of his suo- motu power, well it could be open for the State to submit that the facts and circumstances were such that it would be within reasonable time but as we have already noted the order of the Collector which has been interfered with was passed in January, 1976, and the appeal preferred by the State was also withdrawn some time in March, 1976. The learned counsel for the appellant was not able to point out such other special facts and circumstances by the reason of which it could be said that the exercise of suo-motu power after 15 years of the order C.W.P. No. 4968 of 1986 [ 10] interfered with was within a reasonable time. That being the position, in our view, the order of the Financial Commissioner stands vitiated having been passed after a long lapse of 15 years of the order which has been interfered with. Therefore, while holding that the Financial Commissioner would have power to proceed suo-motu in a suitable case even though an appeal preferred before lower appellate authority is withdrawn may be by the State. Thus, the view taken by the High Court is not sustainable....."

It has been opined in the aforesaid judgments that where there is no limitation provided for exercise of any power, the power must be exercised within a reasonable time and what is "reasonable time" has to be determined on the facts of each case. If the officers are given laxity to exercise suo-motu power at any time where no period of limitation as such has been provided for, the same would lead to anomalous position leading to uncertainty and complications, seriously affecting the rights of the parties, that too, over immovable properties.

If the facts of the present case are considered in the light of enunciation of law, as referred to above, it can safely be opined that exercise of suo-motu power of revision by the Settlement Commissioner after 16 years of even issuance of sale certificate in favour of the successful bidder would certainly be unreasonable especially when the alleged irregularity in sale of property came to the knowledge of the department more than a decade before passing of the impugned order.

In view of the above, the writ petition is allowed. Order dated 6.8.1986 (Annexure P3) and notice dated 28.8.1986 (Annexure P5) are quashed.

(Rajesh Bindal) Judge 22.3.2011 mk (Refer to Reporter)

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Punjab-Haryana High Court