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Tata Iron and Steel Co. Ltd. Vs. State of Bihar - Court Judgment

LegalCrystal Citation
SubjectProperty;Civil
CourtSupreme Court of India
Decided On
Case NumberCivil Appeal No. 479 of 1966
Judge
Reported in1969(1)LC296(SC)
ActsChhota Nagpur Tenancy Act, 1908 - Sections 89; Bihar Land Reforms Act, 1950 - Sections 4; Indian Forest Act, 1929 - Sections 29
AppellantTata Iron and Steel Co. Ltd.
RespondentState of Bihar
DispositionAppeal allowed
Cases ReferredBhola Main v. S.M. Islam
Excerpt:
.....as survey plot - notification issued by governor in order to declare waste land as protected forest - settlement officer passed order that appellants plot to be recorded in name of forest department - board of revenue opined that plots correctly entered in name of government - apex court observed that settlement officer did not have any power to determine question of extinction of lease-hold interest - collector or any other authority competent under act was empowered to decide - order of board of revenue set aside - held, competent authority can determine and adjudicate upon true nature of lease-hold interest of appellant. - arbitration and conciliation act, 1996. sections 8(2) & 30: [h.k. sema, g.p. mathur & r.v. raveendran, jj] setting aside of award - error apparent on..........enquired in to and recorded as laid down in sub-section 3 of the sec. 29 of the said act, but the state government think that such enquiry and record will occupy such length of time as in the mean time to endanger the rights of government and the enquiry and record of rights will hereafter be made. this notification is issued of subject to all ex(sic) rights of individual or communities.' it appears that the enquiry contemplated by the notification with regard to the existing rights of individuals or communities has either not taken place or has not yet been completed. on or about december 6, 1961 the settlement officer, singhbhum, suo motu purported to invite objections regarding the entries in the record of lights relating to the aforesaid land in possession of the appellant. on march.....
Judgment:

Grover, J.

1. This is an appeal by special leave from an order of the Board of Revenue, Bihar State, by which the orders of the Commissioner and the Settlement Officer relating to certain lands which had been taken on lease by the appellant from the Midnapur Zamindari Company Ltd. to be affirmed. By an indenture of lease dated June 27, 1942, the appellant took from Midnapur Zamindari Company Ltd. a lease in perpetuity on payment of a premium of Rs. 5952-2-0 a block of land including a parcel of 6.47 acres in Mauza Khokhro within the old survey plot Nos. 462 and 465 Khata No. 45, Thana No. 323 in district Hanbhum. Under the terms of the said lease the appellant was entitled, interalia, to erect and construct buildings, outhouses, garages etc., to plant trees and lay-out gardens, play-grounds and dig wells and do all other acts and things necessary for using the land for the persons residing in those buildings and houses. In the settlement proceedings which took place later the demised portions of old plot No. 462 were entered as plot No, 859 and portions of the old plot 865 were entered as survey plot Nos. 860 and 861. These plots were shown in the name and possession of the appellant. On April 29, 1953 a notification was issued by the Governor of Bihar in exercise of the power conferred by Section 29 of the Indian Forest Act 1929, hereinafter called the 'Forest Act'. According to this notification, forest land and waste land in the district of Hanbhum specified in the schedule given in the notification were to be called 'protected forest.'

The following portion of that notification may be reproduced:--

'The nature and extent of the rights of Government and private persons in or over the forest lands and waste lands comprised in this notification have not yet been enquired in to and recorded as laid down in sub-section 3 of the Sec. 29 of the said Act, but the State Government think that such enquiry and record will occupy such length of time as in the mean time to endanger the rights of Government and the enquiry and record of rights will hereafter be made. This notification is issued of subject to all ex(sic) rights of individual or communities.'

It appears that the enquiry contemplated by the notification with regard to the existing rights of individuals or communities has either not taken place or has not yet been completed. On or about December 6, 1961 the Settlement Officer, Singhbhum, suo motu purported to invite objections regarding the entries in the record of lights relating to the aforesaid land in possession of the appellant. On March 21, 1963 the Settlement Officer passed an order that the plot should be recorded in the name of 'Bihar Sarkar Forest Department'. It was further directed 'the possession of the Tata Steel Co. Ltd should be recorded in respect of the house standing on plot No. 860 in Col. II which is the admitted case of both the parties.' The entries were ordered to be corrected accordingly. The appellant preferred an appeal under the provisions of the Chhota Nagpur Tenancy Act 1908, hereinafter called the 'Tenancy Act', which was disposed of by the Commissioner of Chhota Nagpur Division on September 16, 1963. He held that the appellant was not in cultivating possession of the plot in question which were not being used for agricultural purposes As such the settlement between the appellant and the Midnapur Zimindari Co Ltd amounted to an encumberance within the meaning of Section 4(a) of the Bihar Land Reforms Act, 1950, called the 'Reforms Act'. The State Government was, therefore, justified in including the plots in the notification issued under Section 29 of the Forest Act and the Settlement Officer had rightly recorded them as belonging to and in possession of the Forest Department.

2. The appellant took the matter in revision before the Board of Revenue. In the grounds of revision it was pointed out that the notification which had been issued under the Forest Act had not been followed by any action or notification under Section 30 nor had any demarcation of the plots been made. Moreover the notification itself made it clear that the rights of private parties were to be determined by means of a proper enquiry. The notification could not, therefore, extinguish or affect the rights of the appellant nor could it establish that the State was in khas Possession of the land in question. It was firmly maintained by the appellant that the Commissioner could not have given any decision in respect of the nature of the rights of the appellant. The question of the title could be decided not by the Settlement Officer or by the Commissioner in the proceedings which were taken but it was the Land Reforms Department which alone had the jurisdiction in the matter. The Board of Revenue called for a report with regard to the plots and made it clear that the mam dispute related to plot No. 861 only. Apart from the other contentions which were raised before the Board it was argued that although the proprietary rights passed to the Government under the Reforms Act, the lease-hold rights were not extinguished and continued to vest in the appellant. An alternative contention was raised that even if the appellant was considered to be a tenure-holder it was entitled to retain the land as a statutory raiyat under Section 5 of the Reforms Act. The Board examined the question of the lease being regarded as an encumberance which was liable to be annulled under Section 4(a) of the Reforms Act after the issuance of the notification under Section 3 or Section 3A of that Act. The orders of the Settlement Officer and the Commissioner were affirmed by tt.e Board of Revenue on the ground that plot No. 861 had been correctly entered in the name of the Government.

3. In order to dispose of the contention raised before us on behalf of the appellant the relevant provisions of the Forest Act may be noticed. Section 29 empowers the State Government to declare by means of a notification that the provisions of Chapter IV would be applicable to any forest land or waste land which is not included in a reserved forest but which is the property of the Government or over which the Government has proprietary rights etc. The forest lands and waste lands comprised in any such notification are to be called 'protected forest' No notification is to be made unless the nature and the extent of the rights of Government and of private persons in or over the aforesaid lands have been enquired into and recorded at a survey or settlement or in such other manner as the State Government thinks sufficient. Every such record has to be presumed to be correct until the contrary is proved. The State Government can, even before this is done, declare the lands to be protected forest pending such enquiry but the existing rights of individuals or communities cannot be affected or abridged by such a declaration. Section 30 provides, interalia, that the State Government by notification, can declare that any portion of the forest specified in the notification shall be closed for such term not exceeding 30 years as the State Government thinks fit. The rights of private persons, if any, over such portion would be suspended during such term if certain circumstances given in the section exist.

The notification which was issued in the present case on April 29, 1953, made it quite clear, as has been observed earlier, that it was being issued subject to all existing rights of individuals or communities because the rights of Government and private persons in or over the forest and waste lands had not yet been inquired in to and recorded as laid down in Sub-section (3) of Section 29 of the Forest Act,

4. It is not at all clear in the present case nor has it been contended on behalf of the State that any enquiry of the nature contemplated by Section 29 and the notification which had been issued under it had been made with regard to the respective rights of the Government and the appellant. The Board of Revenue and the Commissioner do not appear to have proceeded on the footing that the proceedings which had been initiated by the Settlement Officer were in the nature of an enquiry contemplated by Section 29 of the Tenancy Act. The position which has b en taken before us by the learned counsel for the State is that under the provision of the Forest Act the lease-hold interest of the appellant could be validly declared to be an encumberance with the result that the land itself would stand vested in the Government free from all encumberances and it was open to the Settlement Officer to take action under Section 89 of the Tenancy Act for making a correct entry in the revenue record. That section provides that any revenue officer specially empowered by the State Government may, on application or of his own motion within 12 months from the making of any entry in the draft record of rights or of any order or decision under Section 83 & Section 85 or Section 36 revise the same whether it was made by himself or by any other revenue officer but not so as to affect any order passed under Section 87 or any order passed in appeal under Section 85 (4). According to the proviso no such order or decision shall be so revised if a suit or an appeal is pending under sec 85 (4) or Section 87 or until reasonable (sic)ce has been given to the parties concerned to appear and be heard (sic) the matter. Section 89 is contained in Chapter XII which is headed 'Record of Rights and Settlement of Rents'. Section 80 gives the power to the State Government in the matter of order-survey and preparation of record of rights. Section 83 provides a procedure by which a draft record of rights has to be prepared and published. After hearing objections the revenue officer has to frame the record and finally publish it. Section 84 lays down, interalia, that every entry in a record of rights shall be presumed to be correct. Section 87 relates to institution of suits before the revenue officer. It is provided that in the proceedings under Chapter XII a suit may be instituted at any time within three months from the date of the survey and the final publication of the record of rights under Sub-section 83 for the decision of any dispute regarding any entry which a revenue officer has made in or any omission which he has made from the record ..... Section 80 is followed by Section 90 which gives power to the revenue officer to make corrections of bonafide mistakes in the entries in the record of rights Section 92 creates a bar to the jurisdiction of courts in respect of any order directing the preparation of a record of rights under Chapter XII or in respect of the framing, publication, signing or attestation of such a record or of any part of it.

5. It has been contended on behalf of the appellant that the Settlement Officer could not have decided a question of title proceedings under Chapter XII. Learned counsel for the State does not say that the Settlement Officer was competent to decide questions relating to title but he has urged that under the provisions of the Reforms Act the proprietary rights in the demised properties had vested in the State and if a perpetual lease was an encumberance the vesting in the State would be free from that encumberance in terms of Sec. 4(a) of the Reforms Act. The provisions of that Act may he briefly noticed, Sec. 3 empowers the State Government to declare by notification that the estate or tenure of a proprietor or tenure-holder has passed to and become vested in the State. Under Section 3A the State Government may, at any time by notification, declare that the intermediary interests of all intermediaries have passed to and become vested in the State. Section 4(a) reads :

'4. Notwithstanding anything contained in any other law for the time being in force or in any contract, on the publication of the notification under Sub-section (1) of Section 3 or Sub-section (1) or (2) 'of Section 3A the following consequences shall ensue, namely,

Such estate or tenure including the interests of the proprietor or tenure-holder in any building or part of a building, comprised in such estate or tenure and used primarily as office or cutchery for the collection of rent of such estate tenure, and his interests in trees forests, fisheries, jalkars, hats, bazar, mela and ferries and all other sairati interests as rights in mines and minerals whether discovered or uncovered, or whether being worked or not, inclusive of such rights of a lessee or mines and minerals, comprised in such estate or tenure (other than the interests or raiyats or under-raiyats) shall, with effect from the date of vesting, vest absolutely in the State free from all encumberances and proprietor or tenure-holder shall cease to have any interest in such estate or tenure, other than the interests expressly sayed by or under the provisions of this Act.'

Clause (f) of Section 4 provides that the Collector shall be deemed to have taken charge of such estate of tenure and of all interests vested in the State under the section. Clause (g) provides that where by reason of the vesting of any estate or tenure in the State the Collector is of opinion that the State is entitled to the direct possession of any property he shall, by order in writing served in the prescribed manner of the person in possession require him to deliver possession to the State etc., and he can cause to be taken such steps as may be necessary for securing compliance with his order. Under Clause (h) the Collector has the power to make enquiries in respect of any transfer including the settlement of lease of any land comprised in such estate or tenure....If he is satisfied that such transfer was made at any time after first of January, 1946 with the object of defeating any provision of the Act..... he may annual such transfer and take possession of such.

5. The Board of Revenue purported to follow the decision of the Patna High Court in Bhola Main v. S.M. Islam (1). In that case it was held that if a transfer by an ex-proprietor fell within the expression 'encumberance' in Section 4(a) then that transfer would be abrogated as soon as the notification under Section 3 or Section 3A was issued and the estate vested in the State Government. Clause (h) of Section 4 would not apply to a transfer which was an encumberance within the meaning of Sub-section (a) of Section 4. In that case a settlement made for non-agricultural purposes was held to be an encumberance within the meaning of Section 4(a) of the Reforms Act with the result that as soon as a notification was issued by the State. Government under Section 3A the Zamindari interest vested in the State Government and the settlement was automatically canccancelled and the light of the lessee was abrogated. In our opinion the question, in the present case, is one of jurisdiction of the Settlement Officer to decide whether the perpetual lease-hold interest acquired by the appellant from the Midnapur Zamindari Co. Ltd. was an encumberance under Section 4(a) of the Reforms Act. We have not been shown any provision in the Reforms Act itself which would confer such a jurisdiction of the Settlement Officer. It appears extremely doubtful that the Settlement Officer could decide questions of title, namely, whether the perpetual lease-hold inter-of the appellant was an encumberance and as such was liable to be extinguished under the provisions of the Reforms Act. We do not propose to express any final opinion on the question of encumberance because it would still be open to the appropriate authorities, in proper proceedings, to determine and adjudicate upon the true nature of the lease-hold interest of the appellant. We have, however, no manner of doubt that in the proceedings which were taken by the Settlement Officer, apparently under Section 89 of the Tenancy Act, he did not have the competence or the power to determine the question of the extinction of the leasehold interest which owning to the provisions of Section 4(a) of the Reforms Act the Collector or any other authority competent under that Act was empowered to decide.

6. For all these reasons the appeal is allowed and the order of the Board of Revenue is set aside. In view of the entire circumstances the parties are left to bear their own costs.


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