JUDGMENT
Krishna Saran Shrivastav, J.
1. The plaintiff in O.S.No. 598/79 on the file of the I Additional Judge, City Civil Court, Hyderabad is the appellant in this appeal.
2. The facts giving rise to this appeal in brief, are as follows: On 25.11.1964 the respondents jointly purchased the land measuring 4575 square yards of plot No. 5 equivalent to plot No. E in S.No. 318/1 situated in Gaddeannaram village of Hyderabad vide sale deed Ex.B-1 with plan Ex.B-2 attached to it. On 03-05-1975 they sold 445 square yards of land’, out of 4575 square yards for a consideration of Rs. 4,000/- to Sri P. Ranga Raju vide sale deed Ex.A-3. All the respondents had 1/4th share each, in the aforesaid land purchased by them on 25-11-1964. They divided the said land into 5 plots and out of it, one was sold to P. Rangaraju. On 10-06-1975 the 1st respondent sold 484 square yards of land out of the remaining 4130 square yards at the rate of Rs. 24/- per square yard and received Rs. 1,000/- as advance vide receipt Ex.A-2. After 2-3 days there from the respondents filed an application Ex.A-4 to the Secretary, Revenue Department, State of Andhra Pradesh, Hyderabad for permission to sell 484 square yards of land in plot No. 5 equivalent to plot No. E in S.No. 318/1 situated in Gaddeannaram village, Hyderabad (in short “suit land”)
3. The plaintiff brought the suit for specific performance of the contract and damages, against the respondents, alleging that the respondents had sold the suit land to him, through his father-in-law.
4. He has also undertaken to obtain permission from competent authority of Urban Land (Ceiling and Regulation) Act 1976 (in short “Urban Land Ceiling Act”) but they did not obtain the permission in spite of repeated oral and written demands of the appellant. The plaintiff who was ever ready and willing to perform his part of the contract by payment of the balance amount of consideration, the defendants are not taking any steps in obtaining the permission from the competent authority of the Urban Land Ceiling Act. The appellant/plaintiff had to sell his plot at a low price in order to make the payment to the respondents. The cost of construction has also gone up. Therefore, the appellant/plaintiff is entitled for a decree for specific performance of his contract and to claim damages for Rs. 18,384/- and in the alternative for a decree for Rs. 30,000/- as also for a direction to the defendants/ respondents that they should apply in proper Forum to obtain permission from the competent authority of the Urban Land Ceiling Act before execution of the sale deed.
5. The 1st defendant/respondent denied the allegations made in the plaint that the land was sold to the plaintiff by him on behalf of the remaining respondents also. He has also alleged, that on the request of the father-in-law of the appellant/plaintiff he had agreed to sell his undivided share in the suit land at the rate of Rs. 24/- per square yard and had received Rs. 1,000/- as advance. But before accepting the money, he had specifically informed the father-in-law of the appellant/plaintiff who had come to purchase the suit land that it is difficult to obtain permission of the competent authority of the Urban Land Ceiling Act and thereupon, the father-in-law of the appellant/plaintiff had agreed that he would himself obtain the permission for selling the plot. Later, he informed him that a fresh agreement is required for obtaining the permission showing that a major portion of the consideration had been paid by the proposed purchaser. He is still ready and willing to sell his share of the suit land to the appellant/plaintiff if he obtains due permission from the competent authority of the Urban Land Ceiling Act. He has denied that appellant has suffered damages and is entitled to Rs. 18,384/- or Rs. 30,000/- as alleged. He has further pleaded that the agreement is hit by Sections 4 and 5 of A.P. Vacant Lands in Urban Areas (Prohibition of Alienation) Amendment Act, 1972 (Act No. 12/72) and therefore, the contract is void and invalid and therefore is unenforceable under Section 56 of the Contract Act. He has further pleaded that no cause of action for the suit had arisen in favour of the appellant/ plaintiff and the suit deserves to be dismissed. The remaining respondents, remained absent in spite of service of summons and therefore, were proceeded ex-parte.
6. The learned lower Court relying on the case of C. Ramayya v. Mohammadunnisa Begum, held that the contract in question has become impossible to be performed, because it is in contravention of Sections 4 and 5 of the Act 12/72 which was in force at the relevant time. In these circumstances, the appellant/plaintiff is not entitled decree for specific performance of his contract because, Section 10 of the Act 12/72 has overriding effect to the provisions of any other Act which are inconsistent. The learned lower Court, did not answer any other issue and dismissed the suit of the plaintiff.
7. Being aggrieved by the Judgment and Decree of dismissal of the suit, the plaintiff filed the appeal before this Court. It is a matter of record, mat during the tendency of this appeal, the appellant had filed an application for adducing additional evidence on record and two registered sale deeds to be admitted on record. That petition was registered as CM.P.No. 16467/90 and it was allowed vide Order dt. 20-06-1991.
8. This Court, allowed the appeal of the appellant/plaintiff without noticing the respondents Nos. 2 to 4. The respondents filed L.P.A.No. 66/92 and the appeal was allowed on the. ground that notice to respondents 2 to 4 was necessary and directed for re-hearing of the appeal. It was further ordered in this appeal that inasmuch as respondents 2 to 4 entered appearance in the L.P. appeal, it is deemed that notices in this L.P.A. to them are notices in the appeal before the learned single Judge. Hence this appeal had again come up for final hearing.
9. The learned counsel for the appellant has contended that the 1st respondent has admitted the execution of the agreement Ex.A-2. He has also admitted in his cross-examination, that after the execution of the agreement Ex.A-2, he has informed the remaining respondents, and they had also signed along with him on the application Ex.A-4 addressed to the competent authority for permission to sell the suit land under Urban Land Ceiling Act. The learned lower court has wrongly relied on C. Ramaiah’s case (1 supra) as it is distinguishable on facts. Section 4 of the Act 12/72 prohibits any person who owns a vacant land, from alienating the same in any manner and if it is made in contravention of that section the sale would be null and void. But the proviso to mat Section provides, that nothing in this sub-section shall apply to the alienation by any person of any one plot of any vacant land owned by him not exceeding one thousand square metres in extent and not forming part of a compact block. The word ‘compact block’ has been defined in Section 3 (a) of Act 12/72 as under:
“compact block’ means any block of vacant land in an urban area exceeding one thousand square metres in extent, whether owned by one or more persons”
This figure ‘one thousand’ occurring in Section 3 (a) has been deleted and has been substituted by figure ‘five thousand’ with effect from 09-10-1974 by A.P. Vacant Lands in Urban Areas (Prohibition of Alienation) Amendment Act 1974 (in short “Amending Act 1974”). Under these circumstances, the agreement in question is not hit by Sections 4 and 5 of the Act 12/72 as amended. It has been further contended on behalf of the appellant/plaintiff that there is evidence on record, that the respondents have committed default in not performing their part of the contract and therefore, suit should be decreed as prayed for.
10. On the other hand, it has been contended on behalf of the 1st respondent that Act 12/72 has been repealed by AP. Vacant Lands in Urban Areas (Prohibition of Alienation) repealed Act 1978 (in short “Repealing Act 1978”). The contract was existing before the repealing Act has come in force and therefore, it is void in view of Sections 3, 4 and 5 of the Urban Land Ceiling Act, because Section 6 of the Urban Land Ceiling Act provides that in relation to any State in which this Act is in existence provisions of Sub-section (1) of Section 6 shall effect as if, for the words “every person holding vacant land in excess of ceiling limit as on the commencement of this Act” the words and letters “the person who had vacant land in excess of ceiling limit on or before commencement of this Act” have been substituted. Therefore, every person holding vacant land in excess of the ceiling limit as on 07-02-1974 was bound to file a statement before the competent authority having jurisdiction, specifying the entire area, location etc. and vide Section 4(b) the respondents were not entitled to hold more than one thousand square metres of land and Section 3 provides that no person, shall be entitled to hold any vacant land in excess of the, the ceiling limit. The respondents were possessing more than one thousand square metres of land at the time of execution of the contract in question and therefore, they were prohibited from transferring suit plot to the appellant by virtue of Section 27 of the Urban Land Ceiling Act because it forbids such transfer. Even a person holding land within the ceiling limit is not entitled to transfer it without notice as per Section 26 of the Urban Land Ceiling Act.
11. It has been urged on behalf of the remaining respondents, that they had never authorised the respondent No. 1 to sell the suit land to the appellant on their behalf, though they had signed the letter Ex.A-4. But in that letter they had only proposed to sell the land and they have not said therein, that they had already sold the suit land to the appellant and therefore, the 1st respondent was not authorised to act on their behalf to enter into any agreement with the appellant/plaintiff and therefore the contract is not binding on them.
12. In the definition of ‘compact block’ in Clause (a) of Section 3 of the Act 12/72 the word one thousand square metres has been deleted and the word five thousand square metres has been substituted by Section 2 of the Amendment Act of 1974 with effect from 09-10-1974. Section 4 of Act 12/72 forbids any person who owns a vacant land from alienating it by way of sale, mortgage etc. and the sale in contravention of that section is rendered null and void. But the proviso of this Section lays down mat “nothing in Sub-section (1) shall apply to the alienation by any person of any one plot of any vacant land owned by him not exceeding one thousand square metres in extent and not forming part of compact block” that is to say any block of vacant land in an urban area/not exceeding five thousand square metres in extent, whether owned by one or more persons.
13. I get from the evidence of D.W. 1 that he, along with remaining respondents had purchased 4575 square yards of land under sale deed Ex.B-1 and had sold 445 square yards of land on 07-05-1975 vide sale deed Ex.A-3 leaving balance of 4130 square yards. They had men divided the land into 5 plots. He has also admitted, he had sold one plot measuring 445 square yards to the appellant at the rate of Rs. 24/- per square yard on 10-06-1975 and Rs. 1,000/- had taken as advance vide receipt Ex.A-2. Thus, it is clear, that on the date of sale by the 1st respondent, they were in possession of 4130 square yards of land and as such, this land is excluded from the definition of ‘compact block’ as defined under Section 3 (a) of the Act 12/72, as amended by the Amending Act 1974. Under Section 4(1) of the Act 12/72 what is prohibited is alienation of any one plot of any vacant land owned by him exceeding one thousand square metres and not forming part of compact block and proviso to Section 4(1) lays down that alienation by any person of any one plot of any vacant land owned by him not exceeding one thousand square metres of extent and not forming part of compact block is not forbidden.
14. In Chamanlal R. Patel v. State of A.P., (1976 ALT 484 = 1976 (2) An.W.R. 426 = 1976 (2) APLJ 271) it has been held that:
“The expression ‘person’ used in Section 8 of the Andhra Pradesh Land Reforms (Ceiling on Agricultural Holdings) Act, 1973 cannot be taken as including a ‘firm’ also. Because, having regard to the provisions contained in Section 5 (5) of the Act and explanation III of Section 10 of the Act and having regard to the general scheme of the Act that every individual or a family unit is entitled to have at least a standard holding it has to be taken, that when using the term ‘person’ in Section 8 of the Act, the Legislature would not have intended it to be as including a firm also”.
15. Relying on Chamanlal’s case,1 in Transport Corporation of India Limited v. The Special Tahsildar Land Reforms, it has been held:
“Land held by a Company has to be treated as held by individual shareholders for purpose of computation of holding”.
16. Clause (d) of Section 3 of the Act 12/72 defines the word ‘person’ as under:
” ‘person’ includes an individual, undivided Hindu family, a trustee, a company, a society, or an association of individuals, whether incorporated or not”.
17. Sub-section (1) of Section 4 of this Act 12/72 provides that:
“No person who owns any vacant land shall, on or after the commencement of this Act, alienate such land by way of sale, lease for a period exceeding six years, gift exchange, usufructuary mortgage or otherwise, or effect a partition or create a trust of such land; and any alienation made, or partition effected, or trust created in contravention of this section shall be null and void:
Providing that nothing in this sub-section shall apply to the alienation by any person of any one plot of any vacant land owned by him not exceeding one thousand square meters in extent and not forming part of a compact block”.
18. The definition of the word ‘person’ in this Section is almost similar to the definition of ‘person’ as mentioned in Section 3(o) of the A.P. Land Reforms (Ceiling on Agricultural Holdings) Act 1973. The definition of ‘person’ appears to be almost similar in Section 2 (i) of Urban Land Ceiling Act Section 2(i) of Urban Land Ceiling Act defines person as under:
“person’ includes an individual, undivided Hindu family, a firm, a company or an association of individuals whether incorporated or not”.
19. Thus, it is clear that the word ‘person’ has been similarly defined in all the above Acts.
20. Though there is a restriction in the alienation by any person, vide Sub-section (1) of Section 4 of the Act 12/72 the word ‘person’ would not include an association of individuals, because every individual should be permitted to transfer any one plot of any vacant land owned by him not exceeding one thousand square metres in extent and not forming part of compact block. If this interpretation is not given and if an association of individuals are prohibited from transferring the land not exceeding one thousand square metres then the interpretation will lead to absurdity.
21. To give an example, suppose, when a person is permitted to alienate one thousand square metres of land owned by him in his individual capacity, but when he owns two thousand square metres of land jointly with another person, both of them are restricted to transfer land not exceeding one thousand square metres then they will be put to loss, for the simple reason they jointly owned the land. This would be discriminatory to prohibit joint owners to sell the land not exceeding one thousand square yards, though, they are permitted individually, to sell land not exceeding one thousand square metres.
22. For the foregoing reasons, I reach to the conclusion that though the land is owned by all the 4 respondents, each of them is entitled to sell any one plot not exceeding one thousand square metres.
23. In the agreement, the 1st defendant has agreed to sell 484 square yards of land in extent, which is naturally less than one thousand square meters in extent and it is not forming compact block, because by the date of agreement Ex. A-2 the ‘compact block’ means block of vacant land (sic. not) exceeding five thousand square metres in extent.
24. For the reasons aforesaid, I hold that the prohibition contained in Section 4 (1) of the Act 12/72 is not attracted to the agreement in question Ex.A-2.
25. C. Ramayya’s case (1 supra) is distinguishable on facts, because, in that case on 6-8-63 the vendors have agreed to sell the land in their possession to the extent of 8470 square yards, which was forbidden under Section 4 (1) of the Act 12/72. By oversight of the Amending Act, 1974, the learned lower Court has held that sale in question is forbidden by law, vide in C. Ramayya’s case (1 supra)
26. As noted above, by virtue of Section 3 of the Urban Land Ceiling Act, no person is entitled to hold any vacant land in excess of the ceiling limit in the territory. Under Sub-section (1) of Section 4 of the Urban Land Ceiling Act, a person is entitled to possess one thousand square metres i.e. 1100 sq. yards of land. The respondents jointly possessed 4130 square yards of land. There is evidence on record, that at the time of commencement of the Act, they had 1/4th share each in the land in question. Thus, it appears, that each respondent has got 1/4th share in the land i.e. 1032. 50 sq. yards in land measuring 4130 square yards. Therefore, it cannot be said, that the respondents are holding land in excess of ceiling limit. Section26of the Urban Land Ceiling Act provides that Notice has to be given by the person who intends to sell the vacant land which is within the ceiling limit. Thus, what is required is only to give notice to the competent authority of Urban Land Ceiling Act before execution of the sale deed. But transferring the vacant land, which is found in excess of the ceiling limit is prohibited. It has been neither pleaded nor proved by the 1st respondent that he had filed a statement under Section 6 of the Urban Land Ceiling Act that the respondents are possessing vacant land in excess of ceiling limit on the date of commencement of the Urban Land Ceiling Act. Therefore, it cannot be said that the defendants/ respondents are the persons holding land in excess of the ceiling limit and therefore, the transfer made by them is hit by the provisions of the Urban Land Ceiling Act.
27. In the case of Shah Jitendra Nanalal, Ahmedabad v. Patel Lallubhai Ishveribhai, Ahmedabad, (F.B.), Full Bench of the Gujarat High Court has held that:
“Where the land sought to be sold is in excess of Urban Land Ceiling, the Court can pass conditional decree for a specific performance subject to exemption being obtained.
So long as the provision declaring the transfer of vacant land in excess of the ceiling limit under Section 5(3) as void is subject to the right to move for exemption obtain exemption and transfer the property before the owner of the vacant land in excess of the ceiling limit to ‘alienate’ such land is dormant in him and such power could be exercised by him in case he seeks exemption, satisfies the Government that the grounds for exemption exist and obtains such exemption. Therefore, the decree cannot be defeated on the ground that ‘transfer’ inter partes would not be possible, the possibility of obtaining exemption survives till the notification under Section 10 (2) of the Urban Land Ceiling Act is issued”.
In this case, conditional decree for specific performance of the contract against the holder to transfer the vacant land in excess of ceiling limit held by him subject to exemption being obtained under Section 20 of the Urban Land Ceiling Act was passed.
28. I get from the evidence of P.W. 1 and P.W. 2 that the 1st respondent DW-1 has sold the suit land to the appellant/plaintiff on his behalf, as well as on behalf of the remaining respondents. D.W.I has proved the signature of the remaining respondents on the letter Ex.A-2 (sic. A-4) which was addressed to the competent authority of Urban Land Ceiling Act for granting permission to sell the suit land to the appellant/plaintiff. In that letter the word “proposed to sell” has been mentioned but it does not mean that parties have not agreed to sell the suit land to the plaintiff/appellant. The reason is that it has been provided under Section 26 of the Urban Land Ceiling Act that notice in writing of the intending transfer is to be given. Therefore, it is clear that when a party intends to transfer his land, a notice under Section 26 of the Urban Land Ceiling Act has to be given. It appears that under these circumstances, the word “proposed to sell” has been mentioned in the letter but the respondents cannot take advantage of the same, to defeat the case of the plaintiff /appellant. I also get from the evidence of D.W.1 mat after executing the receipt Ex.A-2 in favour of the appellant/plaintiff, he had informed about the same to the remaining respondents and therefore, they had signed the application Ex.A-4. The respondents are joint owners of the land. The remaining respondents had knowledge about the same, that the land was sold to the appellant/plaintiff by 1st respondent and thereafter, they had signed the letter Ex.A-1 (sic. A-4). It can be safely concluded, in the circumstances of the case, mat the act of 1st respondent was reasonable and he had taken prudent course in their interest, in selling the land because, as noted above, the respondents had divided the land purchased by them in 5 plots and one had already been sold. In these circumstances, I reach to the conclusion that 1st respondent has an implied authority to sell the suit land on behalf of the remaining respondents also. There is ample evidence on record, that the appellant/plaintiff had requested the respondents for performing their part of the contract by obtaining sanction from the competent authority. They have received the notice but they did nothing and never made any attempt to obtain the sanction. In the letter Ex. A-6, P.W. 1 had only mentioned the procedure to be obtained in obtaining the sanction. The 1st defendant did not approach the said Ranga Raju forgetting help in obtaining sanction, in spite of receipt of the letter Ex.A-10 which is the reply notice. It is pertinent to note that the respondents had themselves obtained permission of the competent authority, for execution of the sale deed Ex.A-3 in favour of one Ranga Raju. D.W. 1 had admitted that even though P.W.I wrote him the letter that application for permission was returned, he did not meet P.W. 1 for complying with the objections raised by the competent authorities. The belated explanation of D.W. 1 in cross examination that P.W.I did not pay further amount of consideration for executing the fresh agreement, appears to be an after thought particularly, because, there is no whisper in his reply notice Ex.A-19 for payment of money.
29. It would (sic. not) be out of place to mention, that in sale deeds Exs. 53-55 it is mentioned that the respondents had obtained permission from the Urban Land Ceiling authorities vide order Dt. 10-08-1988 to alienate the remaining plots. When they had obtained permission on 10-08-1988 for selling their other plots to other persons it is difficult to accept the evidence of D.W.1 that it was difficult for him to obtain permission. Therefore, it appears that P.W. 1 had taken the responsibility to obtain permission torn Urban Land Ceiling Authorities for disposing of the suit land.
30. For the foregoing reasons, I reach to the conclusion, that respondents have failed to perform their part of contract by not obtaining permission from the Land Ceiling authorities to sell the suit land to the appellant/plaintiff.
31. For the foregoing reasons, I hold that the plaintiff/appellant is entitled to a decree for specific performance of the contract: Ex. A-2 and the defendants/ respondents are liable to give notice to the competent authorities under Urban Land Ceiling (Regulation) Act 1976. If the land is within the ceiling limit, they are directed to give notice within 2 months from to-day by signing the prescribed application torn or in the alternative to seek exemption from the provisions of the Ur-ban Land Ceiling Act if they own the land in excess of the ceiling limit, and on depositing the remaining amount of consideration, by the plaintiff/appellant, within 2 weeks from to-day, they sha1l execute the sale deed in favour of the plaintiff/appellant in respect of suit land.
32. In result, the appeal is allowed. The judgment and decree passed by the I Additional Judge, City Civil Court, Hyderabad in O.S.No. 598/79 are reversed and a decree be drawn as aforesaid. However, looking to the circumstances I leave the parties to bear their own costs.