Punjab-Haryana High Court
Kamla Devi Widow Of Hans Raj vs Financial Commissioner (Appeals) on 12 April, 2013
Author: Rajive Bhalla
Bench: Rajive Bhalla, Rekha Mittal
L.P.A.No.1312 of 2011 -1-
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
(1) L.P.A.No.1312 of 2011 (O&M)
Date of Order: 12th April, 2013
Kamla Devi widow of Hans Raj ...Appellant
Versus
Financial Commissioner (Appeals), Punjab
and others ..Respondents
(2) L.P.A.No.1447 of 2011 (O&M)
Som Raj and others ...Appellants
Versus
Financial Commissioner (Appeals), Punjab
and others ..Respondents
(3) L.P.A.No.1448 of 2011 (O&M)
Som Raj and others ...Appellants
Versus
Financial Commissioner (Appeals), Punjab
and others ..Respondents
CORAM: HON'BLE MR. JUSTICE RAJIVE BHALLA
HON'BLE MRS. JUSTICE REKHA MITTAL
Present: Mr. R.K.Joshi, Advocate
for the appellants.
Ms. Sudeepti Sharma, DAG, Punjab
for respondent nos.1 to 4.
Mr. R.C.Setia, Senior Advocate, with
Mr. Anish Setia, Advocate,
for respondent nos.5 to 9.
RAJIVE BHALLA, J.
By way of this order we shall dispose of L.P.A.Nos.1312, L.P.A.No.1312 of 2011 -2- 1447 and 1448 of 2011 as they arise from the same impugned order and involve adjudication of common questions of fact and law.
The appellants impugn order, dated 09.05.2011, allowing the writ petition, filed by respondent nos.5 to 9, whereby orders passed by revenue officers, dismissing the petition for ejectment, as well as orders affirming this order in appeal and revision, have been set aside and the appellants have been ordered to be evicted from the land in their possession.
Counsel for the appellants submits that the writ petition was allowed without affording an opportunity, to their counsel, to address arguments. An application, filed for affording an opportunity of hearing was also dismissed. On merits, counsel for the appellants submits that the impugned orders are contrary to settled law and are against admitted facts. The appellants are, admittedly, in possession as tenants on the land declared tenants permissible area, on 02.09.1960. The order declaring the land as tenants permissible area has attained finality, without challenge whether by the big landowner or by his legal heirs/donees, in any proceedings, including the writ petition that has been allowed. The rights of the appellants to purchase the land under Section 18 of the Punjab Security of Land Tenures Act, 1953 (hereinafter referred to as 'the 1953 Act') stood crystalized on 02.09.1960, and any subsequent transfer of the land by the big landowner or his subsequent death cannot affect rights accrued under order dated 02.09.1960. The impugned orders have, in essence, nullified order dated 02.09.1960 by applying judgments and principles that apply to surplus area and not to rights of tenants, L.P.A.No.1312 of 2011 -3- in possession of tenants permissible area. A tenant, in possession of tenants permissible area, has a right to purchase land under Section 18 of the 1953 Act, duly protected by Section 15 of the Punjab Land Reforms Act, 1972 (hereinafter referred to as 'the 1972 Act'). An application for purchase, which is the subject matter of LPA Nos1284 of 2011 and 1450 of 2012, was pending before eviction petitions were filed. The eviction petitions were not maintainable as after declaration of tenants permissible area, a landowner can only claim rent. The revenue officers rightly rejected the application for eviction by holding that the landowner may claim rent. The learned Single Judge has reversed these findings by assigning an interpretation to tenants permissible area and to the provisions of the 1953 and 1972 Acts, that is contrary to established law. The learned Single Judge has wrongly held that the applications for purchase were filed, after the applications for eviction were filed. The applications for purchase were filed on on 21.06.1972, whereas applications for eviction were filed on 15.06.1981. The concept of "utilisation" by taking possession and the consequent "vesting" does not apply to tenants permissible area as a tenant is already in possession, as held by the Hon'ble Supreme Court in Mala Singh v. Financial Commissioner and others (supra), 1989, PLJ, 541 and Division Bench judgments, of this Court in Bhag Singh and another v. Financial Commissioner and others, 1989, PLJ, 541, Hari Chand and others v. The Financial Commissioner and others, 2000(2) Punjab Law Reporter, 491, Antu v. Naresh Saran, 2001(2) RCR (Civil), 790, Shashi Kumar and others v. Financial Commissioner, Haryana L.P.A.No.1312 of 2011 -4- and others, 2011(1) Local Acts Reporter, 556. The learned Single Judge has ignored these judgments and erred, while holding that as the land has not vested and possession has not been taken, by the State, the landlord could transfer the land and in view of enactment of the 1972 Act may reserve land for his adult sons. The learned Single Judge has ignored that tenants permissible area stands "utilised" on the date of its declaration as such. The learned Single Judge has erred by placing reliance upon a Division Bench judgment and drawing an artificial distinction between the words "holdings" and "owns" and ignoring Section 16 of the 1953 Act while holding that there is no fetter on the landowner's right to transfer property, even if it is declared tenants permissible area or surplus area. The learned Single Judge has ignored the legal position that after declaration of tenants permissible area, the land stands utilised and, therefore, cannot be transferred by the landlord, in derogation to the rights of a tenant. The judgments referred to in support of these conclusions do not apply to the case in hand. The landowner may at best receive compensation when the application for purchase is allowed and till such time may receive rent from a tenant.
Counsel for the private respondents submits that the impugned order is legal and valid. The appellants were, admittedly, tenants of the big landowner and after the land was gifted to them became tenants of the respondents. The mere fact that the respondents are in possession of tenants permissible area does not absolve them of their obligation to pay rent, or nullify the right of the landlord to seek their ejectment if they fail to pay rent. The ejectment L.P.A.No.1312 of 2011 -5- has been rightly ordered, in accordance with Section 9 read with Section 14-A of the 1953 Act. The defence taken by the appellants that as the land is in their possession as tenants permissible area and as they have filed applications for purchase, they are not obliged to pay rent to Faqir Chand, has been rejected, even by revenue officers. The orders passed by the Commissioner and the Financial Commissioner holding that the tenant cannot be evicted, have been rightly set aside. It is further submitted that if a tenant continues to occupy land that is tenants permissible area but refuses to pay rent or purchase the land, such a tenant would necessary invite eviction. The findings recorded while allowing the writ petition are legal and valid and as surplus area was never declared in the hands of the private respondents whether after the land was gifted to them or after the death of a big landowner, the impugned order is legal and valid.
We have heard counsel for the parties, perused the paper book as well as the impugned orders.
A brief reference to the facts of the case would be necessary. Admittedly, the land, in dispute, was owned by Faqir Chand, a big landowner and the appellants were his tenants. The Assistant Collector, vide order dated 02.09.1960, declared 32 standard acres, in possession of the appellants, as tenants, as tenants permissible area. The order dated 02.09.1960 has attained finality. Faqir Chand, gifted the entire land under occupation of the appellants/tenants to his sons, vide gift deed dated 22.07.1971. The appellants filed applications for purchase of land comprising their L.P.A.No.1312 of 2011 -6- tenancy on 21.06.1972. The applications were opposed by the big landowner. In the meanwhile, the 1953 Act was repealed and the 1972 Act came into force. The private respondents filed an application for dismissal of the application on the ground that, though, the land has been gifted to them by their father, the big landowner, they have not been impleaded as parties. After a long drawn out legal battle, the application for purchase was decided in favour of the appellants by allowing purchase of the land, in dispute, but in writ petitions, filed by private respondents, the orders, allowing purchase applications, were set aside and the matter was remanded for determining surplus area in the hands of the private respondents, under the Punjab Land Reforms Act, 1973 (hereinafter referred to as 'the 1973 Act'), for reasons that are similar, if not identical to the reasons assigned while allowing the writ petition, subject matter of the present appeals. At this stage, it would be appropriate to point out that by a separate order, we have allowed the appeals, which relate to applications for purchase of tenants permissible area, filed by the appellants, on 21.06.1972, by setting aside the order passed by the learned Single Judge and allowing the applications for purchase.
During pendency of the applications of purchase, the private respondents, filed applications in Form-L under Section 14 of the 1953 Act, for eviction of the appellants, from the land, in dispute, on 15.06.1981, for not payment of rent. The private respondents, raised a plea that the appellants are chronic defaulters in payment of rent since Rabi, 1970, without any sufficient cause. The Assistant L.P.A.No.1312 of 2011 -7- Collector Ist Grade, held, vide order dated 31.08.1982, that as the land, in dispute, is tenants permissible area, the private respondents, cannot seek ejectment but can only claim rent. Aggrieved by this order, the appellants filed an appeal. The Collector, Hoshiarpur, allowed the appeal on 27.12.1982 by holding that, though, the appellants are tenants, over land declared tenants permissible area, they can be ejected by the landlord for non-payment of rent as a tenant sitting on surplus area, has the same rights and obligations, as an ordinary tenant. The appellants filed a revision, which was allowed by the Commissioner, (Appeals), Jalandhar Division, Jalandhar, vide order dated 09.01.1984, by holding that a perusal of the Punjab Land Reforms Act, 1973 and the Rules as well as the Utilisation Scheme framed thereunder, indicate that a tenant on surplus land shall be deemed to be an allotte under the scheme. The appellants being, admittedly, tenants on surplus area, though, recorded in possession of tenants permissible area, are deemed to be allottees under the utilisation scheme and, therefore, cannot be evicted for non-payment of rent. A landowner may recover rent but cannot seek ejectment of such a tenant. The private respondents filed a revision, which was dismissed by the Financial Commissioner (Appeals), Punjab.
The writ petitions filed by the private respondents have been allowed by holding that as the 1953 Act refers to "ownership" and "holding", as two different concepts, the landowner cannot hold land beyond permissible area but may at the same time own land beyond permissible area and as the land has not been "utilised", there is no L.P.A.No.1312 of 2011 -8- fetter on the right of big landowner to transfer property beyond his permissible area, which, though, "owned" by him is not "held" by him and the change in law by enactment of the 1972 Act, enables the landlord to increase his holding and reserve land for his four adult sons under the 1973 Act. It has also been held that as ejectment applications were filed, before the tenants filed an application for purchase, the applications of ejectment could not have been rejected on the ground that applications for purchase are pending or have been allowed. It was also held that as Faqir Chand has passed away, the private respondents are entitled to a fresh declaration of their land holdings under the 1973 Act.
The impugned judgment, in our considered opinion, is contrary to the established position in law and is even incorrect, on certain significant facts. The finding that applications for purchase were filed after the petitions for ejectment was filed, is factually incorrect. The applications for purchase were filed on 21.06.1972, before repeal of the 1953 Act and enactment of the 1972 Act, whereas applications for ejectment were filed almost a decade later, i.e., 15.06.1981. Apart from this factual error, the learned Single Judge has erred while holding that as possession was not taken by the State, the land has not been "utilised" and, therefore, could be gifted by the big landowner and upon coming into force of the 1972 Act, the big landowner could reserve separate units for his adult sons. The findings so recorded ignore a settled position in law that the concept of "utilisation" (taking possession) is alien to land declared tenants permissible area as a tenant is already in L.P.A.No.1312 of 2011 -9- possession. The "vesting" of land after taking possession, i.e., "utilisation" applies to surplus area and not to tenants permissible area. A reference in this respect may be made to a judgment of the Hon'ble Supreme Court in Mala Singh v. Financial Commissioner and others (supra). A relevant extract from the judgment reads as follows:-
"8. We have heard learned counsel for the parties. We are of the view that the revisional authorities under the Act and the High Court fell into patent error in holding that the surplus area of Kishan Dutt which was declared tenants permissible area on January 24, 1971 had not been utilised on September 4, 1971 when Kishan Dutt died. The expression "utilised" has not been defined under the Act. It has been, however, used in Sections 10-A and 10-B of the Act to indicate that the surplus area of a landowner gets utilised on the resettlement of tenants on the said land. Under the scheme of the Act the surplus area of a big landowner could be used for the resettlement of landless tenants and Sections 10-A and 10-B of the Act provided that as and when it was done, the said surplus area was taken to be utilised. If the surplus land allotted to the landless tenants under the Act stood utilised, we see no reason why the surplus land which was declared as tenants permissible area under the L.P.A.No.1312 of 2011 -10- Act, be not considered to be utilised. The appellant was an old tenant of the landowner. The land under his possession was declared surplus. He was permitted to continue in the said land by declaring the same as a tenants permissible area. We are of the view that on January 24, 1971 when the surplus land in possession of the appellant was declared as tenants permissible area, it stood utilised by virtue of the said declaration. The landowner, Kishan Dutt, having died after the utilisation of the land in dispute, his successors could not take advantage of the fact that they had become small landowners after the death of their father."
The Hon'ble Supreme Court has clearly held that tenants permissible area stands "utilised" on its declaration as tenants permissible area, and successors of a big landowner cannot take advantage of his death and plead that they have become small landowners. As a necessary corollary, tenants permissible area "vests" and is "utilised" on the date of its declaration as tenants permissible area and a big landowner cannot gift the land or upon coming into force of the 1972 Act include this land in his landholding for reserving separate units for his adult sons, in derogation to the rights of a tenant, on tenants permissible area. A reference in this regard is made to relevant paragraphs of a few Division Bench judgments of this Hon'ble Court, which read as follows:- L.P.A.No.1312 of 2011 -11-
Bhag Singh and another v. Financial Commissioner and others(supra).
"3. There were three qualities of areas which emerged as a consequence of the Old Act, when applicable to a big landowner. He would get a permissible area; if he had tenants settled on some area with effect from April 15, 1953, those tenants would get their tenants' permissible area (for short TPA) and the remaining was surplus area capable of being utilised by the State for resettlement of tenants. The tenants already sitting and the tenants inducted by the State on utilisation of surplus area could purchase their tenancies under section 18 of the Old Act provided the tenancy had continued for six years or more; the only impediment being that the land so sought to be purchased be not included in the reserved area of the landowner. The procedure prescribed therein warranted for such a tenant to make an application to the Assistant Collector Ist Grade who after giving notice to the landowner and to all other persons interested in the land could make an enquiry and determine the value of land which was the average of the price obtaining for similar land during 10 years immediately preceding the date on which the application was made. Further the purchase price was 3/4th of the land so L.P.A.No.1312 of 2011 -12- determined and the tenant could pay it in instalments. On the payment of first instalment, the tenant was deemed to have become owner of the land.
4. Section 18 of the Old Act was only enabling. There was nothing compelling in the old Act for a tenant to ask for a purchase of his tenancy, one of the objects of the old legislation being the removal of intermediaries. The said enabling provision did not fully carry out the object and while framing the New Act the Legislature had in mind to remedy that situation. By enacting Section 15 of the New Act, whereunder a tenant who was entitled under section 18 of the Old Act to purchase the land under his tenancy, was required to opt for purchase within one year from the date of the commencement of the New Act. The concessional rates were further brought down and the number of instalments were enhanced.
In Hari Chand and others v. The Financial Commissioner and others(supra), it was held as follows:-
"18. Surplus area, as mentioned above, does not include tenants's permissible area. It is only non utilisation of surplus area that would come to the rescue of a landlord by dint of the provisions contained in the Act of 1972 and by virtue of L.P.A.No.1312 of 2011 -13- judgment of Full Bench in Ranjit Ram's case (supra). Insofar as tenants permissible area is concerned, the same stood utilised by dint of the the fact that the tenants had already occupied the same and of which landlord was not in possession.
Such land, in our view, stood utilised, the day it was declared to be tenants permissible area. True, this matter was not argued before the learned Single Judge but it is too well settled that the respondents are entitled to defend the order on the grounds other than mentioned in the impugned order or even for that matter on the grounds which have gone against them by the impugned order."
A perusal of the legal position enunciated in these judgments leaves no ambiguity that land declared tenants permissible area stands "utilised" and "vested" on the date of its declaration as tenants permissible area and any subsequent transfer of land comprised in tenants permissible area or the death of the landowner or the coming into force of the 1972 Act does not affect the rights of a tenant, to purchase land comprising tenancy, as conferred by Section 18 of the 1953 Act, duly protected by the 1972 Act. The finding, to the contrary recorded by the learned Single Judge without referring to the aforementioned judgments is legally flawed.
The question, that remains, is whether a landowner may seek eviction of the tenant in possession of tenants permissible area L.P.A.No.1312 of 2011 -14- on the ground of non-payment of rent or can only claim rent from a defaulting tenant. As referred to hereinbefore, the Hon'ble Supreme Court as well as Division Benches of this Court, have held that the moment land is declared tenants permissible area, it stands "utilised" and "vesting" is complete. The landowner's right to deal with the land comes to an end except to the extent of receiving compensation from the tenant as and when his application for purchase is allowed and to claim rent from the tenant, till his proprietary interest is fully extinguished by conferring proprietary rights upon the tenant. A landowner, faced with a tenant, in possession of tenants permissible area, who refuses to pay rent, may approach the Assistant Collector, by way of an application under Section 14 of the 1953 Act for recovery of rent, but does not have a right to eject such a tenant as the land stands "vested" and "utilised" upon declaration of tenants permissible area. If a tenant does not file an application for purchase under the 1953 Act, he may file an application, under Section 15 of the 1972 Act within one year of the coming into force of the 1972 Act and, in case, he does not file an application, even under Section 15 of the 1972 Act, the land would not revert to the landowner or be available for being included in his land holdings for reservation of separate units for his adult sons, but would be included in the surplus pool for allotment to eligible allottees, under the utilisation scheme where a tenant in possession is entitled to preferential allotment. It would be necessary to point out that a landowner cannot "hold" land in excess of his permissible area and in case, it were to be held that he can include tenants permissible area, in his land holding, for L.P.A.No.1312 of 2011 -15- assessment under the 1972 Act, such an act would increase the land holding of a landowner beyond the permissible area set out in the 1953 Act. A landowner, therefore, cannot seek eviction of the tenant in possession of tenants permissible area as this would lead to the landowner "holding" more than permissible area. The words "ownership" and "holding", appearing in the Act have to be understood in the above context and not in the context of a right to deal with or transfer the land i.e. tenant's permissible area to the detriment of the tenant or the tenant's right to purchase.
The right to purchase stands crystalised upon declaration of surplus area and any subsequent act by a big landowner of transferring this land or his demise before the application for purchase is allowed, or the enactment of the 1972 Act, does not adversely affect the right of a tenant. The learned Single Judge has, therefore, committed an error of law while holding that the change of law enabled the big landowner to increase his holding for his four sons, who were majors. The opinion recorded by the learned Single Judge has ignored the fact that tenants permissible area cannot be dealt with by the big land owner or by his sons for inclusion in their land holdings under the 1972 Act as it has already been "utilised" under the 1953 Act and the landlord has been divested of his rights except his right to receive compensation and rent. The passing away of Faqir Chand or his gifting the land, in dispute, to his sons is irrelevant as the land is tenants permissible area that stood utilised in 1960 and was, therefore, not available to the big landowner or his sons for being included in their land holdings after enactment of the L.P.A.No.1312 of 2011 -16- 1973 Act. The learned Single Judge has, in our considered opinion, wrongly applied the judgment Chander Bhan v. Financial Commissioner, Haryana, AIR 1982 (P&H) 76. The judgment rightly holds that transfer of surplus area by big landowner is not barred but the learned Single Judge, apparently ignored the operative part of this judgment which clearly holds that such transfer would be ignored if it comes in the way of utilisation of surplus area, for resettlement of tenants or for purpose of declaration of surplus area in the hands of a big landowner thereby clearly postulating that such a transaction may be legal interse the vendor/ vendee, the doner/donee but would not bind the State or a tenant in possession of tenants permissible area.
In view of what has been stated hereinabove, and as we have allowed the application for purchase, while allowing LPA No.1284 of 2011, by separate order of even date, the present appeals are allowed, order dated 09.05.2011, allowing the Civil Writ Petition No.2913 of 1985, is set aside. Consequently, orders passed by the Commissioner and the Financial Commissioner, are restored and the writ petition is dismissed.
(RAJIVE BHALLA)
JUDGE
12th April, 2013 (REKHA MITTAL)
nt JUDGE