PETITIONER:
KANTILAL AND ORS. ETC.
Vs.
RESPONDENT:
SHANTILAL AND ORS. ETC.
DATE OF JUDGMENT14/11/1991
BENCH:
KASLIWAL, N.M. (J)
BENCH:
KASLIWAL, N.M. (J)
KANIA, M.H.
CITATION:
1992 AIR 477 1991 SCR Supl. (2) 257
1992 SCC (1) 481 JT 1991 (4) 337
1991 SCALE (2)1037
ACT:
Madhya Pradesh Land Revenue Code. 1959.'
Section 50--Court sale of property--Mutation order
passed by Tehsildar on the basis of sale certificate and
compromise application-Collector issuing notice in suo motu
proceedings initiated after 17 years on the legality of the
mutation----Subsequently setting aside the mutation
order--Whether justified.
Town Improvement Trust Act. 1960.
Sections 68, 73--Acquisition proceedings and determina-
tion of compensation Party entitled to compensation on the
basis of mutation order passed by Tehsildar--Collector suo
motu interfering after 17years--Validity of--Enhancement of
compensation--Whether justified.
HEADNOTE:
The land in question was granted by the Ruler of erst-
while State of Ratlam in favour of ancestors of respondents
(Pitaliyas) for installation of a ginning factory. Ancestors
of appellants (Jhalanis) entered into a partnership with
Pitaliyas and started a ginning factory on a portion of the
said land. In the revenue records, in respect of the entire
land the names of Jhalanis and Pitaliyas were entered.
According to the Jhalanis in execution of a decree
against Pitaliyas the above land was sold and Jhalanis
purchased the said land in an auction. On an application
moved by the Jhalanis, the Tehsildar passed an order mutat-
ing the names of Jhalanis in respect of the entire land. The
said mutation was allowed on the basis of compromise between
the parties and on the basis of a sale certificate issued by
the Civil Court.
The Town Improvement Trust started acquisition proceed-
ings for a housing scheme and acquired certain lands includ-
ing the land in question. The Collector started suo motu
proceedings, issued notice to the Jhalanis and set aside the
order of mutation passed by the Tehsildar. An appeal pre-
ferred by the Jhalanis before the Addi-
258
tional Commissioner was dismissed. The Board of Revenue
allowed the further appeal and held that pending mutation
proceedings, there was compromise between the parties,
objections were withdrawn by the Pitaliyas and no appeal or
revision was filed against the mutation order nor any suit
was filed challenging the order of the Tehsildar. The Pita-
liyas then filed a writ petition before the High Court,
which was allowed and the order of the Board of Revenue was
set aside. Against the said judgment of the High Court, the
Jhalanis have preferred an appeal before this Court.
In the acquisition proceedings the Tribunal gave a
finding that Pitaliyas had no right to claim compensation
and Jhalanis alone were entitled to the entire amount of
compensation. The order of the Tribunal was challenged by
the parties by filing separate appeals before the High
Court. The High Court allowed the appeal filed by Pitaliyas
and held that they were entitled to claim compensation in
equal proportion with Jhalanis; it dismissed the appeal
filed on behalf of the Trust for reducing compensation and
allowed the appeal filed by Jhalanis in part and increased
the rate of compensation from 65 paise per sq.ft to 75 paise
per sq.ft. Aggrieved against the aforesaid judgment of the
High Court in acquisition proceedings, the Jhalanis and the
Trust have filed the other two appeals before this Court.
Allowing the appeals on the questions of validity of the
mutation made and entitlement to receive compensation, and
partly allowing the appeal on the question whether enhance-
ment of compensation was justified, this Court,
HELD: 1.1. There was a decree of a Civil Court and in
execution of the same the properties were auctioned. Even if
there was any dispute as to whether any share of Pitaliyas
in the land was sold or not in the auction proceedings the
same does not survive after the compromise between the
parties. In the order of the Tehsildar passed as back as
20th February, 1953 the Jhalanis alone were recorded as full
owners of the properties and they continued to remain in
possession. The Trust took possession from Jhalanis on 21st
March, 1968 in the land acquisition proceedings. There is
nothing on record to show that Pitaliyas ever remained in
possession of the land in question after 20th February, 1953
till the time they made a claim of half share in the compen-
sation before the Tribunal. [264 D, E]
1.2. The Collector had no justification at all to have
initiated the proceedings suo motu in 1970 after 17 years of
the order passed
259
by the Tehsildar. Even under the law of limitation no suit
for possession could have been maintained after 12 years by
Pitaliyas and they were not entitled to any share in the
amount of compensation. There was also no justification for
entering the names of Pitaliyas in the revenue records and
to set aside the order of the Tehsildar dated 20th February,
1953, after 17 years. The Tehsildar was perfectly justified
in passing the order dated 20.2.1953 on the basis of the
sale certificate, as well as compromise application and the
statement made before him on 16.10.1952. [264 F, G]
2. One bigha is equivalent to 22500 sq. ft. and no
contention was raised before the Tribunal that one bigha was
equivalent to 21511 sq. ft. prevalent in the erstwhile State
of Ratlam. For the first time, this point was raised before
the High Court. This being a controversial question of fact
and the other side did not have the chance to lead any
evidence on this point, the High Court rightly negatived it
and held that the compensation for one bigha of land would
be calculated as equivalent to 22500 sq. ft. [265 A-C]
3. The District Judge after consideriug large number of
documentary evidence placed on record by both the parties
arrived at the conclusion based on good and valid reasons
that the fair market price of the acquired land on 22nd
August, 1964 was 65 paise per sq. ft. The High Court went
wrong in increasing the rate from 65 paise to 75 paise
without any valid reasons whatsoever. In the circumstances,
enhancement ordered by the High Court is set aside and the
compensation determined by the District Judge at the rate of
65 paise per sq. ft. is maintained. [266 C-E]
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1345 of 1986.
From the Judgment and Order dated 29.8.1984 of the
Madhya Pradesh High Court in Misc. Petition No.613 of 1983.
Avadh Behari Rohtagi. S.K. Gambhir, Vivek Gambhir and
K.K. Mohan for the Appellants.
U.R. Lalit, S.S. Khanduja, Y.P. Dhingra, B.K Satija and
Surinder Karnai for the Respondents.
The Judgment of the Court was delivered by
260
KASLIWAL, J. In all the above appeals the parties are
the same and the controversies raised are intimately con-
nected and dependent on each other, hence all the cases are
disposed of by one single order.
Land measuring 19 bighas was granted by the ruler of the
erstwhile State of Ratlam in favour of ancestors of respond-
ents Shantilal and Poonam Chand Pitaliyas (hereinafter
referred to as ‘Pitaliyas’) for installation of a Ginning
factory. Ancestors of Kantilal Jhalani and other appellants
(hereinafter referred to as ‘Jhalanis’) entered into part-
nership with Pitaliyas and the partnership started a Ginning
factory on a portion of the above 19 bighas of land. The
names of Jhalanis and Pitaliyas were recorded in the revenue
records in respect of the entire land. The above 19 bighas
of land had some different survey numbers but subsequently
at the time of settlement in Ratlam in the year 1956-57, the
numbers were changed to survey numbers 120 and 121. Survey
No. 120 comprised of 2 biswas and survey No.121 of 18 bighas
and 18 biswas. According to the Jhalanis in execution of a
decree against Pitaliyas the above land was sold and Jhala-
nis purchased the said land in an auction. Thereafter, an
application was moved by the Jhalanis on 13th April, 1951
for mutation of their names before the Tehsildar in respect
of the entire lands bearing survey Nos. 120 and 121 leaving
such portion of the land on which the Ginniing factory was
standing. The Tehsildar vide his order dated 20th February,
1953 allowed the application and passed an order mutating
the names of Jhalanis on the entire 19 bighas of land. The
said mutation was allowed on the basis of compromise between
Pitaliyas and Jhalanis and also on the basis of a sale
certificate issued by the Civil Court.
The Town Improvement Trust, Ratlam (hereinafter referred
to as ‘the Trust’) started acquisition proceedings for a
housing scheme under the provisions of the Town Improvement
Trust Act, 1960 (hereinafter referred to as ‘the Act’) and
issued a notification on 28th August, 1964 under Sec.68 of
the Act. Survey Nos. 120 and 121 were shown in the notifica-
tion leaving out some area of survey No.121. In the acquisi-
tion proceedings, the Trust obtained possession of the
acquired land on 21st March, 1968.
The Collector started svomotu proceedings under Sec.50
of the Madhya Pradesh Land Revenue Code, 1959 and issued a
notice on 17th December, 1970 to the Jhalanis stating that
the mutation proceedings did not appear to be legal. It is
not necessary to state the details of other proceedings by
which the Jhalanis went to the higher authorities as ulti-
mately the matter came back to the Collector by remand. The
Jhalanis contested the proceedings before the Collector and
prayed for the cancellation of the
261
notice dated 15th February, 1972 which was issued afresh by
the Collector after the remand of the case to him. The
Collector ultimately by an order dated 31st March, 1977 set
aside the order of mutation passed by the Tehsildar and gave
a direction that the Tehsildar, Ratlam will again make the
same entry in the revenue records which was done previously
in respect of disputed land. It was further directed that
thereafter the Tehsildar will do proper investigation and
analyse all the concerned facts and events which had hap-
pened in the case and take steps for making the record upto
date. Particularly he will see by which lease and on what
conditions originally how much land was given for factory
purpose by the State and whether that lease is effective or
lapsed. An appeal filed by the Jhalanis to the Additional
Commissioner was dismissed by order dated 11th December,
1981. The Jhalanis then filed an appeal before the Board of
Revenue. This appeal filed by the Jhalanis was allowed in
their favour by the Board of Revenue by order dated 26th
March, 1983. The Board inter alia held that pending mutation
proceedings, there was compromise between the parties,
objections were withdrawn by the Pitaliyas and no appeal or
revision was filed against the mutation order nor any suit
was filed challenging the order of the Tehsildar. The
Pitaliyas then filed a writ petition before the High Court
for setting aside the order of the Board of Revenue. The
High Court by order dated 29th August, 1984 allowed the Writ
Petition and set aside the order of the Board of Revenue and
restored the orders of the Additional Commissioner and the
Collector. Aggrieved against the aforesaid judgment of the
High Court, the Jhalanis have filed Civil Appeal No. 1345 of
1986 by grant of Special leave.
In the acquisition proceedings the question of compensa-
tion was decided by the Tribunal constituted under Sec.73 of
the Act. The Tribunal by its order dated 30th November, 1973
held that Pitaliyas had no right to claim compensation and
the Jhalanis alone were entitled to the entire amount of
compensation. The Order of the Tribunal was challenged by
Pitaliyas, for apportionment of the amount of compensation,
also by Jhalanis for increasing the amount of compensation
and by the trust for reducing the amount of compensation by
filing separate appeals in the High Court. The High Court by
its order dated 29th July, 1984 allowed the appeal filed by
the Pitaliyas and held that they were entitled to claim
compensation in equal proportion with Jhalanis. The High
Court dismissed the appeal filed on behalf of the Trust. The
High Court allowed the appeal filed by Jhalanis in part and
increased the rate of compensation from 0.65 paisa per Sq.
Ft. 10 0.75 paisa per Sq. Ft. Aggrieved against the afore-
said judgment of the High Court in acquisition proceedings,
the Jhalanis have filed Civil Appeal No. 1346 of 1986 and
the Trust has flied appeal No.3426 of 1987 by grant of
special leave.
262
We have heard learned counsel for the parties and have
thoroughly perused the record.
The land in question was given by the Ruler of erstwhile
State of Ratlam for establishing a Cotton Ginning factory at
Ratlam. The deed of partnership between the Pitaliyas and
Jhalanis has not been produced on the record of this case
but the admitted position is that the Janlabandi entries in
the revenue records of the year 1921-22 show tllat survey
Nos. 1326 to 1336, 1337/2 and 1340 to 1342 (subsequently
changed to Survey Nos. 120 and 121), stood in the name of
Keshrimal Vardhman Pitaliya and Keshrimalji Dhanrajji Jhala-
ni in equal shares. Keshrimal Vardhman Pitaliya proprietor
of firm Vardhman Keshrimal died sometime prior to 1932 and
he left behind two sons Sagarmal and Vinayakrao Pitaliya who
became the proprietors of Hindu Undivided Family firm Vard-
human Keshrimal. Sagarmal and Vinayakrao Pitaliyas did not
apply for the mutation of their names in the revenue re-
cords, after the death of their father Keshrimal Pitaliya.
Keshrimal Dhanraj Jhalani had to recover some amount from
the firm Vardhman Keshrimal and he filed a civil suit for
the recovery of the money against Sagarmal and Vinayakrao
Pitaliyas. A degree was passed in favour of Keshrimal Dhan-
raj Jhalani and they filed an application for execution of
the decree. In the execution case No. 161/42 the right,
title and interest of Pitaliyas in the Ginning Factory were
sold in auction for Rs.6541 and which was purchased by
Keshrimal Dhanraj Jhalani on 2nd November, 1946. A sale
certificate was also issued in favour of Keshrimal Dhanraj
Jhalani by the Civil Court Ratlam on 3rd October, 1950. On
the basis of this sale certificate Keshrimal Dhanraj Jhalani
applied for mutation in the revenue records on 3rd April,
1951 before the Tehsildar, Ratlam. Alongwith the application
Keshrimal Jhalani filed a copy of the sale certificate and a
certified copy of the Jamabandi of the land of Samwar year
20,35 (1948-49 A.D). During the pendency of this mutation
application Vinayakrao Pitaliya died leaving no heirs.
Sagarmal who was Karta of the Joint Hindu Family filed
objections to the mutation application on 17th March. 1952.
It is important to note that in these objections Sagannal
clearly raised the ground that in the auction proceedings
only movable property of the factory was sold and as such
Keshrimal Dhanraj Jhalani had no right to clam mutation of
the entire agricultural land in his favour. Thereafter an
agreement took place between Sagarmal Pitaliya and Keshrimal
Dhanraj Jhalani on 16th October. 1952. This agreement made
in writing was filed before the Tehsildar in which Sagarmal
Pitaliya agreed to with draw his objections for the mutation
of his share in 19 bighas of land. in favour of Shri Keshri-
mal Dhanraj Jhalani in lieu of Shri Keshrimal Dhanraj JhaIa-
ni having agreed not to recover Rs.4941. being the balance
amount of decree passed in suit No.2 of 1932 against Pita-
liyas. Apart from the
263
aforesaid compromise application the statement of Sagarmal
Pitaliya was also recorded on 16th October, 1952 itself and
Sagarmal clearly made a statement that he was withdrawing
his objections as regards mutation in respect of his share
in the land of 19 bighas and that he had no objection to the
mutation of Shri Keshrimal Dhanraj Jahalani’s name in re-
spect of the land in dispute. Thereafter, the Teshsildar
rejected the objections filed by Sagarmal and passed an
order on 20th February, 1953 granting mutations in the name
of Shri Keshrimal Dhanraj Jhalani. After this order of
mutation passed by the Tehsildar on 20th February, 1953
Sagaramal or any other member of the family of Pitaliyas did
not take any steps for challenging the aforesaid order of
the Tehsildar. It is further proved on record that thereaf-
ter names of Jhalanis alone was continued in the revenue
records in respect of the entire 19 bighas of land. The land
acquisition proceedings then commenced in the year 1964 and
possession over the land was taken by the Trust on 21st
March, 1968 from Jhalanis. The Collector took suo motu
proceedings in 1970 and passed an order on 31st March, 1977
setting aside the order of the Tehsildar. In the above set
of circumstances Pitaliyas came forward and claimed half
share in the compensation amount in land acquicition pro-
ceedings before the Tribunal. The Tribunal rejected the
claim of the Pitaliyas but High Court by order dated 29th
August,1984 granted half share in favour of Pitaliyas taking
the view that they were persons interested under the Town
Improvement Trust Act. On the same day by a separate judg-
ment the High Court set aside the order of Board of Revenue
and maintained the order of the Additional Commissioner and
the Collector passed in mutation proceedings.
After going through the entire record ,’red hearing the
arguments at length, we are clearly of the view that the
High Court went wrong in passing the impugned orders. As
already mentioned above from the year 1922 onwards the
entries in the Revenue records in respect of 19 bighas of
land was made in favour of Jhalanis and Pitaliyas both in
equal share. Jhalanis had a decree against Pitaliyas and in
execution of said decree share of Pitaliyas was auctioned
and was purchased by Jhalanis for a sum of Rs. 6541. Sale
certificate was also issued in favour of Jhalanis. According
to Jhalanis the half share of Pitaliyas in the land was also
sold and on that basis an application was filed before the
Tehsildar for ranration of the entire land in their favour.
According to Sagarmal Pitaliya who was also Karta of Joint
Hindu Family, no such land was sold in auction. 11 may be
noted that the bid in auction was for an amount of Rs.6541
but it did not satisfy the entire decretal amount and the
balance of Rs.4941 still remained due against the
Pitaliyas–Judgment debtors. In view of these circumstances
a compromise took place between the parties according to
which Sagarmal agreed to withdraw his objections in consid-
eration of
264
satisfaction of the aforesaid amount of Rs.4941 outstanding
against him. On 16th October, 1952 the compromise applica-
tion was filed in writing and statement of Sagarmal. was
also recorded in which he clearly agreed that he will not
claim any right in the land and withdraw his objections and
the amount of Rs.4941 was taken as satisfied and Jhalanis
agreed not to recover the aforesaid amount of Rs.4941. It is
an admitted position that the order passed by the Tehsildar
on 20th February, 1953 rejecting the objections of Sagarmal
Pitaliya and mutating the name of Jhalanis for the entire
land, was not challenged and the same became final.
Mr.U.R.Lalit, learned Sr. Advocate appearing on behalf
of Pitaliyas did not argue, that the compromise application
filed on 16th October, 1952 and the statement recorded on
the same day were forged or not genuine. The only submission
made by Mr. Lalit was that any order passed in mutation
proceedings cannot confer any legal title in favour of
Jhalanis nor such order can divest the ownership rights of
Pitaliyas in the agricultural land. We do not find any force
in this submission. Admittedly, there was a decree of a
Civil Court and in execution of the same the properties were
auctioned. Even if there was any dispute as to whether any
share of Pitaliyas in the land was sold or not in the auc-
tion proceedings, the same was settled at rest by making a
compromise between the parties. Not only that after the
order of the Tehsildar passed as back as 20th February, 1953
the Jhalanis alone were recorded as full owners of the
properties and also continued to remain in possession. It is
also proved that the Trust took possession from Jhalanis on
21st March, 1968 in the land acquisition proceedings. It is
no where proved on record that the Pitaliyas ever remained
in possession of the land in question after 20th February,
1953 till the time they made a claim of half share in the
compensation before the Tribunal. The Collector in our view
had no justification at all to have initiated such proceed-
ings suo motu in 1970 after 17 years of the order passed by
the Tehsildar. Even under the law of limitation no suit for
possession could have been maintained after 12 years by
Pitaliyas and they were not entitled to any share in the
amount of compensation. There was also no Justification for
entering the names of pitaliyas in the revenue records and
to set aside the order of the Tehsildar dated 20th Febru-
ary,1953 after 17 years, As already mentioned above, Tehsil-
dar was perfectly justified in passing the order dated
20.2.1953 on the basis of the sale certificate, as well as
compromise application and the statement of Sagarmal marie
before him on 16.10.52.
Now, we shall deal with Civil Appeal No.3426 of 1987
filed by the Trust. It was argued on behalf of the appel-
lant-Trust that in the erstwhile State of Ratlam one bigha
was equivalent to 21511 Sq. Ft. as per Jantri
265
Milan Bigha Va Ekad prepared in 1911 and the lower courts
wrongly calculated the area acquired by treating one bigha
equivalent to 22500 Sq. Ft. as now prevalent according to
the prescribed standards. We do not find any force in the
abvoe contention. No such argument was raised before the
Tribunal and it was raised for the first time before the
High Court. The High Court rejected the aforesaid argument
on the ground that admittedly at present one bigha was
equivalent to 22500 Sq. Ft. and no contention was raised
before the Tribunal that one bigha was equivalent to 21511
Sq. Ft. prevalent in the erstwhile State of Ratlam. This
being a controvercial question of fact and the other side
having given no chance to lead any evidence on this point it
was difficult to rely on the Jantri Milan Bigha Va Ekad. The
High Court thus held that the compensation for one Bigha of
land would be calculated as equivalent to 22500 Sq. Ft. We
do not find any error in the aforesaid view taken by the
High Court.
It was next contended on behalf of the Trust that the
Tribunal had awarded compensation at the rate of 0.65 paisa
per Sq. Ft. and there was no ground or justification for the
High Court to have increased the same at the rate of 0.75
paisa per sq. Ft. There is some force in the above conten-
tion raised on behalf of the Trust. The High Court in in-
creasing the rate of compensation to 0.75 paise per Sq. Ft.
has given no reason. The High Court in this regard observed
as under:
“Thus, after going through the oral as well as
documentary evidence and material placed on
record and after beatifing the learned counsel
for the Trust as also appellant No. 1 and also
after going through the case law cited, the
question arises at what rate compensation
should be paid for the land which is compulso-
rily acquired. It cannot be disputed that
either party No. 1 nor party No.2 was making
any use of the land at the time of acquisi-
tion. On the contrary it was being treated as
a waste and fallow land having no importance.
There is no satisfactory evidence placed on
record to prove that in fact the land was
being used as an agricultural land from which
certain income was derived. It appears this
land gained importance only when the trust
proposed to acquire the same.
Therefore, though the principles enunciated in
the various authorities cited and referred to
above are not disputed, we are of opinion that
considering the facts and circumstances of the
case it would be just, proper and reasonable
to award compensation for the land at the rate
of 0.75 p. per square feet and not more be-
cause the price fetched for the developed
lands also the price fetched for the small
plots of land cannot be taken
266
into consideration for purposes of comparision
in respect of such big lands. After all for a
developed plot of land the cost of development
has also to be taken into consideration which
cannot be said to be quite meagre, Besides,
admittedly there is a big nala in the land in
question, that there was no direct independent
road to approach this land and that even the
factory was also not working for several years
before the acquisition. All these facts indi-
cate that the potential value of the land even
as a building site was not so high.”
Learned Distt. Judge after considering large number of
documentary evidence placed on record by both the parties
arrived to the conclusion that the fair market price of the
acquired land on 22nd August, 1964 was 0.65 p. per Sq. Ft.
The finding recorded by the Distt. Judge in this regard was
based on adequate material placed on record and supported by
good reasons. In our view the High Court went wrong in
increasing the rate from 0.65p. to 0.75p. without any valid
reasons whatsoever. As a result of the findings recorded
above, the appeal Nos. 1345 and 1346 of 1986 filed by Kanti-
lal & Ors. are allowed. The appellants therein would alone
be entitled to claim the entire amount of compensation. The
orders of the High Court, Addl. Commissioner and Collector
in the matter of mutation proceedings are set aside and that
of the Board of Revenue is upheld. The appeal No.3426 of
1987 filed by the Trust is allowed in part. The market value
determined by the High Court at the rate of 0.75p. per Sq.
Ft. is set aside and the rate determined by the District
Judge at 0.65p. per Sq. Ft. is maintained. In the facts and
circumstances of the case, there would be no order as to
costs.
G.N. Appeals
allowed.
267