T.P.S. Chawla, J.
(1) The Delhi Simla Catholic Archdiocese is a society registered under the Societies Registration Act 1860. It owned a vast area of land in Bahapor, which is a village situated within the District of Delhi a little beyond, the Okhla headwords as one goes south.
(2) The society had owned this land since many decades. I was told that, originally, it was a gift to a Christian religious order made either by a Mughal emperor or a European princess. The record does not indicate the origin of the. softy's title, but there is no dispute that it was, the owner.
(3) For generations the land was occupied by tenants. There were different tenants on different portions of the land. They paid rent at the rate of 3 annas. 4 pies per bigha per annum, which was also the rate of land revenue assessed on the land The society, however, did not, in fact, pay any land revenue because it was remitted (maufi). It has been proved, and is not now disputed, that the tenants had rights of occupancy under section 6 of the Punjab Tenancy Act 1887.
(4) In November 1959 the land was acquired by the Government for the planned development of Delhi'. Before the Collector, a controversy arose as to the apportionment of the compensation between the society and the occupancy tenants. The Collector formed the opinion that the compensation should be divided between the society and the occupancy tenants in the ratio of 13 : 87. But, as there was a dispute between in parties, he referred the matter for decision to the court under section 30 of the Land Acquisition Act 1^94. The Additional District Judge has held that the compensation should be divided in the ratio of 50: 50. In six cases, the occupancy tenants have now appealed. There is no appeal by the society.
(5) The Additional District Judge dealt with the cases in batches. All the cases of various occupancy tehants pending at a given time were consolidated, audit was agreed that the evidence in each be read in all. The question of apportionment Wag then decided by a common judgment. This process was repeated three times, though on the third occasion only one ease fell to be decided. The decision of the Additional District Judge was every time the same, and for substantially the same reasons.
(6) The six appeals by the occupancy tenants, with which I am now concerned have not arisen out of one and the same judgment. The cases came on for hearing before the Additional District Judge at different times and were, thereforee, included in different batches. However, since the question involved is the same, and the judgments of the 'Additional District Judge rest on essentially the same grounds, the appeals were argued before me together. I will decide all of them by this common judgment.
(7) Oh behalf of the society, a great deal of reliance was understandably placed on an entry in the Wajib-ul-arz, prepare ed during, the Settlement of 1880, in respect of the village of Bahapur. It is entry 19, which translated. from the Urdu, reads as follows : If the land of an hereditary Cultivator (i.e. an occupaney tenant) is acquired By the Government, the owner and the cultivator will Be entitled to share the componsation half and half or the matter will be decided by the Panchayat. A non-hereditary cultivator has no tight to receive any compensation. In case the land is acquired along with the standing crop, then, from out of the compensation, the owner shall be entitled only to the extent of the land revenue, and the cultivator will be entitled to the balance. Counsel for the society contended that this entry recorded a custom existing in the village or, alternatively, an agreement between the owners and the occupancy tenants. In either event, he said, it was binding on the occupancy tenants and fully justified the apportionment in equal shares by the Additional District Judge. I will take the argument in its several parts.
(8) As a preliminary, it is necessary to know what is a wajib-ul-arz. The British, as they extended their rule over the territories of India, caused records-of-rights in land to be prepared for the purpose of collecting revenue and making settlements. In Punjab this was done after it was annexed in 1849, and to that end various rules, orders and instructions were issued from time to time : see the Punjab Land Revenue. Act 1887 by Om Prakash Aggarwala (8th edn.) page 3. Later, these were superseded by the Punjab Land Revenue Act 1871. That Act, in turn, was replaced by the Act of the same name passed in 1887, which .is still in force.
(9) The wajib-ul-arz was a part of the record-of-rights. In it were recorded the customs existing in a village. Under the Act of 1871, there were rules framed under section 15 which directed the maintenance of such a record : see the Punjab Land Revenue Act 1887 by Om Prakash Aggarwala (8th edn.) 'page 196. In the Act of 1887, it is prescribed by section 31(2)(b) that the record-of-rights shall include 'a statement of the customs respecting the rights and liabilities in the estate'. The document complying with this requirement $8 known as the wajib-ul-arz. It is commonly described as the village administration paper.
(10) Although, the wajib-ul-arz was intended to record only the customs prevailing in a tillage, it also came to contain entries which were in effect agreements. As Stanley, CJ., explains in Returaji Dubain v. Pahlwan Bhagat and others, 33 All. 196 (F.B)(1) this was due to certain directions issued to settlement officers. The validity of such agreements recorded in a record-of-right was recognised^ and preserved by section 111 of the Punjab Tenancy Act 1887.
(11) Since the wajib-ul-aiz is apart of the record-of-rights, the entries which it contains are 'presumed, to be true until the contrary is proved'. It is so stated in section 44 of the Punjab Land Revenue Act of 1887. Of course, the presumption may be displaced, and whether it is or not depends entirely, on the facts see Raja Rajinder Chand v. Mst Sukhi and others : 1SCR889 . In evaluating the facts it is worth remembering the observation of the Privy Council in Anant Singh v. Durga Singh, 32 All. 363(3), that 'there is no class of evidence that is more likely to vary in value according to circumstances than that of the wajib-ul-arzes.....'. The reason is that they were prepared in varying circumstances by men of Varying ability. It is instructive that, in that very case, the principal ground on which the Privy Council upheld the rejection of the wajib-ul-arz was 'internal evidence.
(12) The first question is whether entry 19 in the wajib-ul- arz records a custom existing in the village of Bahapur. After much cogitation I have come to the conclusion that it does not. I have reached this conclusion largely from the contents of the entry itself, and the historical background when it was made.
(13) In the first place, the entry contains no reference at all to any custom, nor even the slightest indication that it is a custom that is being recorded. Even the title of the entry Is simply: 'Regarding Cultivators', and makes no mention of any custom. If the settlement officer was making the record of a custom, - one would expect, according to the natural use of language, at least some allusion to it. But I can find none.
(14) It is true that in Returaji Dubain v. Pahlwan Bhagat and others, 33 All. 196 (F.B.) the majority held that 'where the contrary is not shown' a provision in a wajib-ul-arz 'should be presumed to be the record of a custom', and that view found favor with the Privy Council in Sheobaran singh v. Mt. Kulsum-un-nissa and others . That does not mean, however, that the absence of any reference to a .custom or any indication thereof is of no relavante remains a matter to be taken, .into consideration, which is what Stanley, C.J., did in his dissenting judgment. I would agree that, by itself, it is not sufficient to rebut the presumption. Nevertheless, it does add to the weight of other considerations.
(15) Secondly, the .whole entry is written in the future tense. It relates what 'will be' or 'shall be', not what 'has been'. In stating a custom one can use eitherthe past or the present tense. One can say such-and-such 'was' or 'has been' or 'is' the custom. But how can one say such-and-such 'will be' or 'shall be' the custom The future tense is wholly inappropriate to the subject, for, by definition, a custom -is something which has existed in the past and continues to exist.
(16) This consider'ation is more significant than it may, at first sight, seem. The cases show that quite often what was recorded in the wajib-ul-arz was not a custom but merely the 'wish' of the inhabitants of the village. Thus, in Najibulla v. Nadir, 120 P. R. 1881(5), it was said that 'the whole tenor of the clause (in the wapb-ul-arz) raises a suspicion that the clause embodies not what the zammdars knew to be the custom actually existing in regard to adoption, but what they considered would be a good and convenient rule to prescribe for the future'. Likewise, in Anant Singh v. Durga Singh, 32 All. 363, the Priyy Council observed: '................ it seems probable that the entries recorded connote the views of individuals as to the practice that they would wish to see prevailing rather than the ascertained fact of a well established custom.........'. And, in Jagir Singh and others v. Narain Singh and another (1954) 56 P.L.R. 507 (6)it is stated that the presumption arising from an entry in a wajib-ul-arz is 'overthrown' by showing 'that it is not a. correct statement of the custom as it exists but a statement of the custom as it ought to be'. And, there are other similar cases. Looking at entry 19 in the light of these authorities, the presumption that it records a custom is further shaken.
(17) Thirdly, in the wajib-ul-arz prepared at the time of the next settlement, which was in 1908, the contents of entry 19 are not repeated. It is an accepted principle that 'where a new wajib-ul-arz is framed, the old one ceases to be operative' : see Chander Bhan and another v. Mohammad and others Air 1936 Lah 962(7). Assuming that entry 19 recorded a custom existing in 1880, how did that custom disappear in 1908? The settlement officer who prepared the majib-ul-arz in 1908 presumably had the wajib-ul-arz of 1880 before him. If he. and those who assisted him, had thought that entry 19 recorded a custom, they would have lad little option but to repeat it, unless satisfied that the custom had been abandoned or fallen into desuetude. In the latter event, it would be reasonable lo expect some note or word of Explanationn, but the wajib-ul-arz of, 1908 is silent.. The chances of the custom having been discarded or allowed to die, in so short a space of time are mal. Especially, when no reason has been suggested why that should have happened, nor is one easy to divine. So, the absence of a similar entry in the wajib-ul-arz of 1908 strongly tends to show that entry 19 did not record a custom.
(18) Fourthly, there is no evidence of any instance in whichhe custom was followed,. Considering that the custom, if such it be, has now been in existence for over a century, there has been more than ample time for instances to occur. Yet, not one single instance is forthcoming. I know that the Privy Council has said a number of times that an entry in a wajib- ul-arz good prima facie evidence of a custom' despite the fact that it is not .'corroborated by evidence of .instances' : seo Kumar Digambar Singh v. Ahmad Sayeed Khan Air 1914 P.C.11 Sheobaran Singh v.. Mt. Kulsum-un-nissa and others , and Mt Vaishno Ditti v. Mt. Rameshri and others Air 1918 P. C. 294 However, this proposition does not imply that the lack of any instance in support of a custom is of no moment at all. That would be. a startling proposition indeed. .
(19) As I understand the proposition, it means only that the presumption raised by an entry in a wajib-ul-arz is not fully rebutted by the lack of instances, and the burden of proof shifts nonetheless. That is how the proposition is expressed in Sher Moharnmad and others v. Zulfaqar A.IP, 1938 Lah 312, where the judges distinctly had the rulings of the. Privy Council in mind. In Jai Narain and others v. Mt. Parsani Air 1939 Lah 358,. it was said that even if the entry is not supported by any instances it 'must be looked upon as a strong piece of evidence', which is merely another way of saying the same thing. There are observations scattered throughout the judgment in Labh Singh v. Sarjit Singh and another Air 1949 B.P. 401(12), which accord with my understanding of the proposition.
(20) Furthermore, the Privy Council itself ruled in Anant Singh v. Durga Singh 32 All. 364, that the court below 'properly attached weight to the fact that no evidence at all was forthcoming of any instance in which the alleged custom had been observed'. This case was distinguished in Sheobaran Singh v. Mt. Kulsum-un-nissa and others , but was neither disapproved nor overruled. A', an example of a case in which the entries in a wajib-ul-arz were rejected because they .had never been acted upon, I would refer to Ram Sam Das v Mula Singh 64 P.R. 1903.
(21) thereforee, on a conjoint reading of all these authorities, I think, it would be correct to say that, whilst the absence of instances in support of a custom is not by itself sufficient to repel the presumption arising from an entry in a wajib-ul-arz, that circumstance can properly enter .into the final reckoning. Its importance is enhanced by the fact that there is 'internal evidence' in the entry which militates against it being the record of a custom : see Anant Singh v. Durga Singh 32 All. 363.
(22) Fifthly, and this is a consideration which I find over whelming, there could be no such custom as is supposed to be recorded in entry 19; or, at least, not a valid custom. It is elementary that the prerequisites -of a valid. custom are that it should be ancient, certain and invariable' : see Digest of Customary Law by Rattigan (13th edn.) page 140. That has been settled law for centuries. 'Ancient' has been paraphrased to mean that it should be 'immemorial in origin'. In an oft- quoted passage Blackstone said : '....... a custom, in order that it may be legal and binding, must have been used so long that the memory of man runneth not to the contrary; so that if any one can show the beginning of it, it is no good custom'. However, the Privy Council held in Mt: Subhani and others v. Nawab and others , that this technical doctrine of English law was not apposite or useful when applied to Indian conditions' and that
'WHATis necessary to be proved is that the usage has been acted lupon in practice for such a long period and with such invariability as to show that it has, by common consent, been submitted to as the established governing rule of the particular district.'
In Gokal Chand v. Parvin Kumari AIR 1952 S.C. 231, the Supreme Court adopted that as the correct statement of the law.
(23) Applying these tests to entry 19, it is immediately obvious that the alleged custom, which it is claimed it records, could not possibly be 'ancient'. The entry deals with the apportionment of compensation paid when land is acquired by the Government. Clearly, there was no scope for a custom to develop regarding that matter until a law for acquisition of land came into existence. Now, the earliest Act providing for acquisition of land by Government was Act Vi of 1857. That was replaced by Act X of 1870, and then came the present Act of 1894 : see the Law of Land Acquisition and Compensation by V. G. Ramachandran (2nd edp.) page 183, 184 'and 201. As I have mentioned already, the British annexed Punjab in 1849, and, so far as I know, before the advent of British rule there was no system of acquiring laid by payment of compensation. So, it emerges, that a law providing for acquisition of land became known in these parts for the first time in or about 1857. The wajib-ul-arz is of 1880. Hence, if it ever existed, the custom recorded in entry 19 must have sprung up in the two decades or so before that entry was written. That is certainly not a long enough period to make the custom 'ancient'.
(24) Also, there is no proof whatsoever that the 'usage' was ever 'acted upon', let alone 'invariably'. There is not an iota of evidence 'to show that it has, by common consent, been submitted to as the established governing rule' in Bahapur. .None of the requirements for holding the custom to be 'ancient have been established. The history of the law of land acquisition precludes the custom from being ancient. For all these reasons, I would hold that entry 19 does not record a custom.
(25) Then, does it record an agreement between the owners and the occupancy tenants? Again, the entry makes no reference to an agreement and does not even use the words 'it is agreed'. However, its general tenor is compatible with the possibility that it is an agreement : in particular, the use of the future tense. That possibility receives added support from the manner in which the wajib-ul -arz has been recorded. At the end, after the last entry, there are a considerable number of signatures. Below these signatures, the settlement officer has written : Today, in my pres.enise, the persons who have signed above, attested and admitted the contents of the wajib- ul-arz'. This makes it look like a memorandum of agreement. There are also signatures at quite a few other places in the wajib-ul-arz. Probably, the persons concerned with or likely to be affected by an entry or a group of entries were made to sign under them. The tone and style of those entries is, by and large, similar to that of entry 19. All these features leave the impression that the settlement officer was resolving points of dispute, and having' procured an agreement, obtained the signatures of those who were sought to be bound by it. Otherwise, there appears to have been no purpose in making different people sign the wajib-ul-arz at various places.
(26) Assuming, then, that entry 19 embodies an agreement, the next question is, what is its effect The answer depends on the appropriate .inference to be drawn from the fact that the entry is not repeated in the settlement of 1908.
(27) , in any other contract, it is for the parties to decide what will be the duration of an agreement recorded in a wajib- ul-arz. Their intention must be gathered from the agreement and other circumstances of the case : see Prabhu Dyal v. Amin Chand and others Air 1929 Lah 232(16). If the agreement is 'expressly stated to be operative for all time', its omission from the wajib-ul-arz prepared at the next settlement does not render it 'inoperative-: see Nandu and others v. Jaimal and another Air 1928 Lahore 150(17). The result is the same even if there be no such express term, but the 'wording of the agreement' shows that it 'was .to ensure beyond the period of the settlement' : see Gokal vs. Yaquh Ah and others Air 1929 Lahore 237. Conversely, an agreement 'expressly limited to the term of the first settlement, cannot be held to persist through a later settlement in which the agreement was not renewed' : see Lieut, Chaudhri Chattar Singh v. Mt. Shugni and another Air 1941 Lah 239.
(28) But, what of the intermediate case, as here, where there is no indication one way or the other, either express or implied Or, in other words, what is the ordinary span of an agreement recorded in a wajib-ul-arz? At one time there were diverse opinions on this point, but the Supreme Court has now approved the view that an entry in a wajib-ul-arz 'holds good during the period of the settlement in which it is made and becomes inoperative when the .settlement has come to am end': see Chhote Khan and others v. Mal Khan and others, : 1SCR60 . Thus, even accepting that entry 19 recorder an agreement, it lasted only till 1908, when the next settlement was made. As. it was not then renewed, it did not operate thereafter, and is of no consequence in the present appeals.
(29) In his first two judgmtents in these cases the -Additional District Judge held entry 19 to be binding as as agreement. But, on the third occasion, he was shown Chhote Khan and others v. Mat Khan and others : 1SCR60 , and felt compelled to change his.-mind He, too, has finally held that entry 19 is no longer binding.
(30) The sole remaining possibility, if entry 19 be not an agreement, is that it represents the 'wish'. of the inhabitants of the village as to the ratio in which compensation for acquired land should, in future, be distributed. Since Wishes ate not legally enforceable, this possibility needs .no further attention.
(31) Though I have said enough to put the wajib-ul-arz out , of the way there is yet another reason why it has? to be ignored. Whether it be a custom or an agreement that is recorded in entry 19, in either event it is void for uncertainly. It will be see that thefirst sentence of the entry has two parts separated by the disjunctive 'or'. Thereby, two alternatives are p
(32) Apart -from this ambiguity which is patent, there is 'also a latent one. The word 'Panchayat' must obviously be given the meaning which it bore in 1880. But, no one knows, and there is no evidence to establish, how a Panchayat was -constituted at that time-and how many members it had. This makes the second alternative uncertain even taken by itselt. The entry, thereforee, suffers from a twofold uncertainty.
(33) Counsel for the society at first suggested that the entry should be understood to mean that the matter would be decided by the Panchayat only if there was a. dispute. But he soon. realised the futility of that approach. Here, there is a dispute. so the matter had to be decided by the Panchayat find not by applying the formula of 'half and half. 'And, as there has been no determination by the 'Panchayat', whatever its constitution may be, the custom or agreement recorded to entry 19 has produced no ratio on which the court can act.
(34) This is the inconclusive result even if the interpretation suggested by counsel were accepted as being sound. But I do not accept that interpretation for one moment. It requires substitution of the words 'and, in the event of a dispute. for the word 'or' an, exercise for which there is absolutely no Warrant. Besides, I cannot see what purpose is achieved by prescribing a fixed ratio in one part of the sentence, and giving liberty to dispute it in the next. In those circumstances, I should think, it is inevitable that a dispute would always develop. It is hardly likely that the party dissatisfied with the prescribed ratio of ;half and half would refrain from contesting the matter. This curious mode of laying down a fixed ratio is self-defeating.
(35) Ultimately, after trying out a few more variations, counsel for the society took the position that the real meaning of the entry was that disputes regarding matters other than apportionment of compensation should be decided-by the Panchayat. Considering that each of the three sentences in entry 19 deals with apportionment, it is not credible that totally unconnected matters were sought to be dealt with by a sidewind. Counsel was hard put to it to 'find any examples in support of his contention. I can find nothing in the context of the entry which even remotely supports counsel's interpretation. Again, what is sought to be done is to substitute the words 'and other matters' turn the words 'or the matter By no rule of construction, is so radical an alteration permission
(36) Sp, with the wajib-ul-arzelimintedm a solution has to be found on generla principles. The principle on which apportionment should be made, is quite obvious. Both common sense and elementary justice dicatate that the cimpensation should be divided between the landlord andthe tenant according to the values of their respective interests in the land, for that is what each of them has lost.On this propostoition, all the authorities are agreed : see for example Dinendra Narain Roy v. Tituram Mukerjee I.L.P. 30 Cal 801 (28), Hakim Singh and others v. Collector, Gurdaspur and another Air 1932 Lah 123 (2) (21) and Batan Singh and others v. Nathu Birju, . It is the axiom which underlies every discussion.
(37) Simple as this proposition is, its practical application is beset with difficulties. The problem is how to value the respective interests of the landlord and the tenant. From the cases, three possible situations appear. They are classified in Dossibai Nanabhoy Jeejeebhoy v. P. M. Bharucha : (1958)60BOMLR1208 ,Sintosh Kumar Dhar v.Nanda Kishore Mallick aad another : AIR1958Cal56 and Bai Saraswati Jeshankar and another v. Agent, Bharatkhand Textile . : AIR1967Guj36 .
(38) First, it may be possible in a given case to value the individual interests of both the landlord and the tenant. Theoretically, the sum of those two values should-be equal to the compensation awarded, for the sum of the parts must be equal to the whole. In the rare case where that ideal result occurs, the problem is ended. The compensation is divided in accordance with the individual values found. Rut, more often the sum of the individual values determined will not tally with the amount of compensation awarded. In that event a just result is achieved by distributing the compensation' in proportion to the individual values adjudged : see the observations of Macklin, J., in Shri Somashekhar Swami v. Bapusaheb Narayanrao Patil Air 1948 Bom 176 (26). .
(39) Secondly on the limited data available in a particular case or because of the peculiar nature of the interest involved, Or for some other reason, it may not bepossible to value both the individual interests but only one, that is, either of the landlord or the tenant; In that situation the method often adopted is to pay the ascertained amount to the party the value of whose interest is determinable, and give the balance of the compesation to the other. For instance, in Smt. Nanda Rani Debi v. Messrs Apar Collieries Ltd., : AIR1963Cal636 the landlord was paid the capitalised value of the rent, and the rest of the compensation was given to the tenant. On the other hand in Nibas Chandra Menna v. Bipin Behary Bose Air 1926 Cal 846 ,(28) and T. Durai rajan v.Sri Kasi Viswanathaswamy temple, : (1975)2MLJ323 , the interest of the tenant was evaluated, and the balance of the compensation was paid to the landlord.
(40) Thirdly, it may be that neither the interest of the landlord nor that of the, tenant can be accurately valued in terms of money. What is to be done then The only possible answer is that the court should do the best it can to arrive at a ratio and divide the compensation accordingly. In finding the ratio, regard must naturally be had to the evidence. But, what if there is no evidence or it is unsatisfactory? In that situation, how should the court proceed in the matter Well, it can lay down some 'rough and ready' rule based on a fair estimate' : see Rohan Lal v. Collector of Etah, : AIR1929All525 . Of course, any such 'rough and ready' rule necessarily contains an element of arbitrariness and cannot be elevated to the status of a rule of law. Nor can it be used even as a guide turn malting a 'rough estimate' when the circumstances and considerations are different : see Shiam Lal and others v. Collectoa: of Agra : AIR1934All239 . Nevertheless, when no other option is available, a 'rough and ready' rule is accepted to be in order.
(41) The next question is, into which of these classes do the present cases fall Clearly, that depends on whether the respective interests of both the society and the occupancy tenants, or of one of-them, can be valued in money or not.
(42) I will consider first the interest of the society as the owner of the land. There is only one piece of evidence on record, which is of any relevance in valuing that interest. It is the rent of 3 annas 4 pies per bigha per annum that was paid to the society. No other information which might assist in placing a money value on the interest of the society appears from the record.
(43) It may be thought that by capitalising the rent it is possible to deduce the value of the society's interest. Indeed, some decisions in the early part of this century did in fact adopt that method. But it has been consistently rejected ever since, and for good reasons.
(44) The formula of arriving at the value of the ownership rights by capitalising the rent, makes certain assumptions, which are not valid. It assumes that the rent once fixed is constant and unchangeable, which is not true. Even under the Punjab Tenancy Act 1887 the rent may be enhanced or reduced: through the scope is not too great : see sections 22 and 23. It farther assumes that the only benefit which the landlord derives from the land is rent, and nothing else. Thereby it ignores altogether a number of important factors. .It takes no account of the right of reversion which is very valuable : see Ramacharya Narayana Charya BurIi and another v. State of Mysore and others Air 1965 Mys 1 . The possibility of surrender or forfeiture resulting in accelerated reversion is completely disregarded. So, also, the chance of the tenant dying without any heirs, and the consequent lapse of the leasehold rights to the landlord. In any of these eventualities, the landlord may gain a substantial benefit by re-letting the land for a premium or higher rent or putting it to some more remunerative use : see Sadasheorao- Krishnarao Buti Money-lender v. Collector, Nagpur aad another Air 1942 Nag 86 (33).
(45) Above all, no allowance is made for the fact that the value of the land may have appreciate enormously because what was originally 'agricultural land has become a 'prospective building site' : see Nibas Chandra Manna v. Bipin Behary Bose Air 1926 Cal 846. The rent may have been fixed decades ago, and may bear no relation to the present value of .the property, yet, the formula remains, inflexible : see Sadasheorao Krishnarao Buti Money-lender v. Collector Nagpur and another and Ramacharya Narayana Charya Burli and another v. State of Mysore and others Air 1965 Mys I (F.B.). This is well illustrated by the present cases themselves. The rent of 3 annas 4 pies per bigha per annum was probably settled sometime in the last century. Usually, rent is capitalised at 20 to 30 years' purchase or thereabouts. But, even if 50 years be allowed in the present instance, the value of the society's interest in the land works out to Rs. 10-6-S pies per bigha. That demonstrates the ludicrous results the formula produces.. In 1959, when the society's land was acquired, it would not have been possible to purchase one square yard of land in Delhi at that price.
(46) Apart from capitalisation, no other method of computing the value of the society's interest from the rent was suggested or is conceivable. I, thereforee, conclude that it is not possible, on the evidence, on the evidence, to determine in money the value of the society's interest.
(47) The position with regard to the interest of the occupancy tenants is no better. If the net profit made by them were known, it would have been possible to value their interest by capitalising the profit. Here, none of the objections that I have mentioned against capitalising the rent to value the society's interest would prevail. The average net profit in the years immediately preceding 1959 would be a very reliable index of the capital value of the occupancy tenants' interest when the land was acquired. But the evidence on record does' not enable the net profit to be determined.
(48) The only evidence on this point is the statement of Devi Ram, one of the occupancy tenants. He said that in 1950 the rental value of the land (presumbly, if sublet) was Rs. 500 per bigha, and in 1962 it was Rs. 600 per bigha. How he arrived at these figures, be did not say. In cross-examination he admitted that he was 'not in possession of any document showing the rent settled or received from the actual tiller' in respect of the land. He was also asked about the yield of the land, the number of crops obtainable in a year, and the rates at which the vegetables grown could be sold. The answers which he gave are indefinite and rendered subject to many qualifications, especially as regards the availability of water. In any case, they pertain to the year 1929 and so are of no use. To attempt an estimate of the profit on this evidence would be futile.
(49) Besides, there no evidence whatsoever of the expenditure incurred by the occupancy tenants. Devi Ram does not advert to this aspect of the matter at all though he does admit that 'all the members of the family used to work in the fields'. For arriving at the net profit it is necessary to deduct the value of the tenants own labour and his outlay 'in the way of purchasing seed, employing labour and paying for irrigation costs' : see Roshan Lal v. Collector of Etah : AIR1929All525 . No such calculation is possible on the state of the evidence . For all these reasons, the money value of the occupancy tenants' interest cannot be ascertained.
(50) Since neither of the interests can be valued in money, it must follow that the present cases fall under the third class. Consequently, from the evidence one must Judge, as best one can, the relative values of the two interests, that is, their ratio. Or, alternatively, a 'fair estimate' must be made in the form of a 'rough and ready' rule.
(51) The evidence consists of some transactions to which the society and the occupancy tenants were parties. The ratio furnished by these transactions are-widely divergent. I have not found it possible to be satisfied of the correctness of any particular ratio merely on this evidence. In these circumstances, I propose to form a fair estimate by considering the nature of an occupancy tenancy and the rights and liabilities it creates. Afterwards, I will turn to the evidence for such assistance as it can give.
(52) The tenure known as 'right of occupancy' is dealt with by the Punjab Tenancy Act, 1887. From the definition of land' in section 4 it is an obvious inference that this tenure can exist only in respect of land which 'is occupied or has been let for agricultural purposes or purposes subservient to agriculture, or for pasture'. The concept of land' in the statute, and hence the concept of the tenure, does not extend to land which is 'occupied as the site of any building in a town or village'.
(53) Not only must the land be occupied or let for an agricultural purpose, the tenant must continue 'to cultivate his tenancy, either by himself or some other person'. Should he fail to do so 'for more than one year without sufficient cause', the right of occupancy is in peril of being 'extinguished' by section 38 from the end of that year . The use of the land for an agricultural purpose is thus fundamental to the notion of an occupancy tenancy.
(54) As regards the rent, section 12 makes it 'the first charge on the produce'. If it is not paid 'as it falls due', the right of occupancy is again in danger of being 'extinguished' by section 38. The rent. may be increased under section 22 if the malikana is less than a certain proportion of the land revenue, but the increase cannot be more than is required to achieve that proportion. Attoday's values the enhancement so permitted would not be worth the trouble. The rent can also be reduced under section 23 on the ground 'that the productive powers' of the tenancy 'have been decreased' by a cause beyond the control of the tenant.
(55) There is a very great security of tenure. An occupancy tenant can be ejected only on three grounds, which are stated in section 39. He can be ejected if he uses the land 'in a manner which renders it unfit for the purposes for which he held if. The best example is when he builds upon the land making it unfit for agricultural purposes. Or, he may be evicted, where the rent is payable in kind, if he has 'without sufficient cause failed to cultivate (the) land in the manner or to the extent customary in the locality in which the land is situate'. This ensures that he does not reduce the rent by his own inaction, thus causing loss to the landlord. Lastly, he may be evicted if 'adecree for an arrear of rent' has been passed against him and 'remains unsatisfied'. In practice, the first two grounds are bound to be frequently thwarted by the power of the court under section 48 to grant relief against forfeiture. Only the third ground is untrammelled by that power, and can assure ejectment with any certainty-
(56) Another way in which the tenancy may come to an end is by 'abandonment' This occurs under section 38 on the concurrence of two events : the tenant must fail to cultivate the land for more than one year, without sufficient cause, and must also fail to arrange for payment of rent as it falls due. The fulfillment of one of these conditions alone is not enough.
(57) In addition, of course, the tenant can always 'relinquish the tenancy. He must then give notice in the manner prescribed by section 36.
(58) Pausing here to assess the probabilities, I think, it is fair to say that the chances of an occupancy tenant being evicted, or the tenancy being abandoned or relinquished, .are rather remote.
(59) Though the right of occupancy is transferable, the assent of the landlord has to be obtained one way or another. A tenant having a right of occupancy under section 5, is required by section 53 to give the first option to purchase to the landlord. In effect, that means that a transfer to some other person cannot be made without the landlord's tacit consent. For, he has to be persuaded not to exercise his option. In contrast, section 56 says that a tenant having a right of occupancy under any other section cannot transfer his right 'without the previous consent in writing of the landlord'. Here, the consent has, thereforee, to be explicit. But, in either case, the result is that the landlord has the last word.
(60) The right of occupancy is heritable, but again there axe limitations. The heirs and the mode of devolution are declared once and for all by section 59. No tenant can alter them, for he has no power to dispose of his light of occupancy by will : see Sawan Singh v. Kartar Singh and another Air 1933 Lah 400. The field of succession delimited by .section 59 is medium in extent. If there are no heirs, the right of occupancy is 'extinguished' by sub-section (4). Obviously, the odds whether the succession will fail, and the tenancy lapse, can only be gauged from the state of a particular tenant's faimly.
(61) That is the broad picture. It is manifest that, under a right of occupancy, the tenant derives much greater benefit from the land than the landlord. He has possession) which is remark- ably secure, and reaps all the profits arising out of the land. All that the landlord gets is a meagre rent. No doubt the landlord does have, in addition, the right of reversion, but till, if ever, it falls into possession, it remains a mere prospect yielding no immediate material return.
(62) Moreover, since the profit can vary it is able to offset adverse economic fluctuations. A depreciation in the value of money can be made up by a rise in profits. But, the rent fixed at the commencement of the tenancy remains almost static. Even supposing the conditions of section 22 are-fulfilled, the enhancement permitted is, in present monetary terms, no more than symbolic. It is not a ground for enhancement that the value of money has fallen and the rent has been reduced to a pittance. The erosion which time may cause can be seen from the rent paid to the society.
(63) This .being the position, it seems only right that the tenant should receive the major part of the compensation awarded for the acquisition of the land. After all, he loses the entire profits issuing from the land, whereas the landlord loses only the rent which, in comparison, is small. thereforee, the compensation should be apportioned in a corresponding ratio.
(64) But, there is an assumption which underlies this whole reasoning. It postulates that the compensation has been based on the value of the land for agricultural purposes. That is what justifies division of the compensation according to a ratio which rests on the same assumption. For, it will be remembered that the use of the land for an agricultural purpose is the sine qua non of a right of occupancy. It is from the nature of that tenure that reasons for the ratio were drawn. Since the ratio and the compensation are thus founded on the same assumption regarding the use of the land, the former can legitimately be applied for apportioning the latter because the two are properly matched.
(65) However, if the compensation has been awarded on some different basis, then, it is self-evident, that this whole edifice lacks the foundation on which to stand. On a careful examination of Nibas Chandra Manna v. Bipin Behary Bose Air 1926 Cal 846, it is this distinction that emerges as its ultimate ratio decidendi. Take, for example, the present cases. It is known that compensation for the society's land was based on its value as a 'potential building site'. Otherwise, the compensation would have been much less than it was. - To apportion compensation, so awarded, according to a ratio which assumes the use of theland for agricultural purposes would clearly be wrong. It would amount to dividing the sale proceeds of a building site by comparing the value of the vegetable produce of the land with the rent. The building potential, the main factor responsible for making the quantum of the compensation what it is, will have been totally ignored. In consequence, there would be a gross misdivision of the compensation.
(66) In order to obtain a ratio properly applicable to the compensation awarded for a potential building site, the ratio must be based on a parallel hypothesis. Common sense enjoins that, in allocating portions, one should adhere to the principle on which the compensation was awarded. So, with the right of occupancy intact, one must envisage what would happen if the land were sought to be used for building purposes. A moment's reflection discloses that neither the tenant nor the landlord could so use it. If the tenant tried to build on the land he would make himself liable to ejectment under section 39 for having used the land in a manner which rendered it unfit for agricultural purposes. On the other hand, the landlord could not build on the land for the simple reason that he does not have possession. The only way in which the land could be used as a building site is by the tenant and the landlord acting in unison. By refusing to do so, any one of them could cause a stalemate.
(67) Having regard to this situation, how should the compensation be apportioned The only possible answer, it seems to me is, in. equal shares. For it cannot be said that either the tenant or the landlord is in a more dominant position in this respect. Without each agreeing, no building can be constructed. Their rights of veto are of equal strength. That, in my opinion, is the vital clue to apportionment of compensation paid for a potential building site held under a right of occupancy when the land was acquired.
(68) Considerations of fairness suggest the same conclusion. It is by pure chance or, at any rate, by extraneous developments, that agricultural land becomes a potential building site. As was said by Krishnan, J., F.G. Natesa Aiyar and others v. Kaja Maruf Sahib Air 1927 Mad 489 :
'THISenhanced value is, not due to the exertion either of the landlord or the tenant, it is a sort of windfall which has come to both the parties. There is no reason why one alone should have the whole of it and not the other.'
Even a layman would agree that the only fair way of dealing with the 'windfall' is to divide it 'half and half.
(69) It is, thereforee, perhaps, not wholly a coincidence that I have independently arrived at the same ratio as the wajib-ul-arz. Although, for the reasons already stated, I have excluded entry 19 from consideration, it is not unreasonable to suppose that the ratio which it mentions was intended to represent what was thought to be right after weighing 'all the pros and cons.
(70) The Additional District Judge arrived at the same ratio. He may not have brought out in full relief the significance and effect of compensation having been paid for a potential building site, yet, I think, the reasons given in his judgment are substantially the same as mine.
(71) A glimmer of the line of reasoning which I have tried to expound can be discerned in the undercurrent of the decision in Rohan Lal v. Collector of Etah : AIR1929All525 , thoagh it never quite rises to the surface. There, compensation was apportioned between the landlord and the occupancy tenant m the ratio of 10:6, which is not very far removed from 'half and half. The inequality was due to the court's finding that in the United Provinces there was a 'substantial disparity' between the rights of the landlord and those of an occupancy tenant.
(72) A full bench of the same High Court subsequently approved that judgment in Shiam Lal and others v.. Collector of Agra : AIR1934All239 . In the elaborate reasons now intimated, I would call attention to two critical passages. After adverting to the peculiar situation in which neither the landlord nor the tenant can build on the land, Sulaiman, C.J., said : It thereforee fellows that the benefit of the enhanced value of the land should go both to the zamindar and the tenant'. Likewise, in his concurring Judgment, King, J., explained that 'The land does not become available to a third party for building purposes unless the landlord transfers his interests and the occupancy tenant also surrenders his occupancy' rights'. For this reason, he said, 'both the landlord and the tenant are clearly entitled to a share in the special value'. That is precisely what I am saying. The full bench upheld the ratio of 10:6, but Sulaiman, C.J., was at pains to dispel any notion that this was, or could become, a 'rule of law'. It was, he emphasised, merely a 'rule of practice for the purpose of forming a rough estimate..............'.
(73) In nearly every case decided thereafter, the Judgment of the full bench in Shiam -Teal's case has been noticed. Very rarely has it not been cited. Some of the later cases adopt the ratio of 10:6 accepted by the full bench. Out of those cited before me, I would mention Sadasheorao Krishnarao Buti Money-lender v. Collector, Nagpur and another and Dossibai Nanabhoy Jeejeebhoy v. P. M. Bharucha. (1958) 60 B.L.R. 1208. Others reach a different ratio. In Sadasheorao Krishnarao Buti Money-lender v. Collector, Nagpur and another , it was 1:3, against the landlord. In Shri Somashekhar Swami v. Bapusaheb Narayanrao Patil Air 1948 Bom 176, it was 55:45, and in Bihari Lal v. Harinder Singh and others , it was 3:1, both in the landlord's favor. In Collector of Dacca vs. Gholam Kuddus Choudhury and others : AIR1936Cal688 , it appears that Shiam Lal's case was not cited, but Rohan Lal's case was. There seems to be a mistake in the judgment in that Rohan Lal's case is said to have been decided by the Judicial Committee of the Privy Council. Actually, as the report shows, it was decided by a division bench of the Allahabad High Court. However, be that as it may, the court found the ratio of 2:3 against the landlord.
(74) No general rule can be extracted from these or the other cases to which I have referred. Indeed, most of them themselves contain observations that there is no general rule. In each case, the particular ratio can be accounted for by some special feature or a local law. It is not clear in which, if any, of them the compensation was based on the value of the land as a potential building site. In none of them has this aspect of the matter received sufficient attention. Nor have its implications been fully appreciated. Nevertheless, the fact is significant that in none of these cases is any fault found with the reasoning in Shiam Lal's case. I think that now, after nearly half a century, it can be said with some confidence that it has stood the test of time. Whether it be that I am following it or that it supports my view I feel greately fortified.
(75) On behalf of the occupancy tenants it was strongly argued that, in no event, could they be given a lower proportion than was given to the tenant, by a division bench of this court, in Hanuman Pershad etc. vs. Chuni alias Chuni Lal & others, 2nd (1977) 2 Del 687 . I do not agree. In that case, the compensation was ordered to be divided between the owner and the tenant in the ratio of 35:65. The tenant did not have occupancy rights but was protected under the Delhi (Urban Areas) Tenants' Relief Act 1961, which affords rather similar security of tenure. In my opinion, the case is of no assistance because it contains no indication that, for awarding compensation, the land was evaluated as a potential building site. That makes all the difference If the compensation represented the value of the land for agricultural purposes, the ratio is perfectly understandable, but irrelevant.
(76) Apart from that, however, no case can be a binding precedent for another in the matter of finding a ratio for apportionment. This is repeatedly emphasised by all the authorities. At one place in its judgment the division bench observes that the decided cases 'give to the tenant from 36 per cent to 80 per cent and the balance to the owner'. The conclusion then stated is that 'depending on the circumstances of a case, compensation awarded may even .be apportioned half and half. That makes it abundantly clear that no absolute rule was sought to be laid down, and that 'half and half was well within the range contemplated.
(77) It remains to have a glance at the evidence. Copies of. a number of Judgments delivered by various Additional District Judges of Delhi are on record. They pertain to land situated both in Bahapur and in other villages. In all these judgments, except one, the wajib-ul-arz of the concerned revenue estate was followed. The lone Additional District Judge who affirmed the ratio adopted by the Collector, was obliged to do so only because no contrary evidence had been adduced. But, soon afterwards, in another case, he fell in line with the others. Insofar as some of these judgments apportion the compensation in equal shares, I could rely on them as good evidence for my conclusion, as did the judge below. But I do not attach much weight to them because they proceed merely on the wajib-ul-arz, which I have discarded. And, they make .no attempt at any real analysis . of the problem.
(78) The other documents in evidence show that, on two occasions, the society was able to purchase the occupancy rights of .some of its tenants and then lease the land for commercial purposes. The first time was in April 1953. By six sale deeds dated 23rd April 1953 the society purchased the occupancy rights in a number of contiguous plots owned by it. The very next day, on 24th April 1953, the entire area thus freed from occupancy rights was leased to the Associated Cement Companies Limited for 99 years. Permission was given to the lessee to erect buildings on the land and use it 'in any manner' it thought fit. The second time was in June l954. The occupancy rights were purchased by three sale deeds. Thereafter, on 9th June 1954, the land was leased to the Indian Iron and Steel Company Limited. The material terms of the lease were almost the same as those on the previous occasion.
(79) From 'these transactions, counsel for the society sought to deduce the 'ratio in which the compensation should be apportioned. He capitalised, at 20 years' purchase, the rent at which the commercial leases had been granted. To this he added the entire amount paid to the tenants for the purchase 'of their occupancy rights. the said, this had also in fact been paid by the lessee). The aggregate, according' to him, represented the' value of the total rights of full ownership'. (Presumably, he meant the leasehold rights). By comparing the amount, paid to the occupancy tenants with this aggregate amount, he obtained a ratio of approximately 4:1 in favor of the society. That is the ratio which, he asserted, was right, and it would give the society much more than the Additional District Judge had given. He conceded, of course, that since the society had not appealed against the apportionment made by the Additional District Judge, it could not now get more than it had already received. But, he argued, that this established that there was no justification for interfering with the ratio already applied.
(80) Though, for the other reasons which I have already stated, I affirm the apportionment in equal shares, I do not accept this submission of counsel for the society. It contains too many fallacies. I will mention just a few.
(81) The rent at which the commercial leases were given by the society cannot be the starting point for determining the value of the society's interest at an earlier stage. The rent represents the value of the society's interest after the land was rid of the occupancy rights, whereas what has to be compared with the value of the occupancy rights is the value of the society's interest subject to those rights. The relevant interest of the society is ownership minus possession, not plus possession. Since the first step is wrong, everything which follows must also be wrong.
(82) Second, the rent depends on the purpose for which the lease is granted. Normally, a lease for a commercial purpose fetches a higher rent. It provides no basis whatsoever for deriving the value-ratio of the interests under an agricultural tenure. In essence, it is the same old mistake of a change in the hypothesis.
(83) And, thirdly, leaving all else aside, the value of the occupancy rights must be compared with the value of the society's interest, not with the aggregate of the two, or something greater, as counsel for the society did. This way, the approximate ratio gets immediately reduced to 3:1. There are other arithmetical flaws, but the matter is not worth pursuing.
(84) This argument advanced on behalf of the society was rejected by the Additional District Judge on somewhat other grounds. He thought that the occupancy tenants had parted with their rights at a low price as their plots were small, and they were not in a position to directly negotiate a commercial lease, and so forth. I need not dwell on these aspects because, in my view, the method of calculation propounded by counsel for the society is ab initio unsound.
(85) Certainly more pertinent is another pair of transactions. On 29th December 1958, a Dr. (Mrs.) Khorshed Pasricha purchased the ownership rights in a portion of the society's land which was held by occupancy tenants. On 5th February 1959 she agreed to sell her title to Glaxo Laboratories (India) Private Limited. The sale deed was executed on 3rd August 1959. The occupancy tenants agreed to sell their rights to the same company on 25th February 1959. They executed the sale deed on 14th May 1959. These sales should furnish the best conceivable data for ascertaining the relative value of the two interests. They are direct sales by the holder of each interest to a buyer intending to use the land for a commercial purpose. The ratio which they furnish is 46:54 in favor of the tenants.
(86) I think, there can be doubt that the difference in the values, exhibited by this ratio, is due to the fact that the occupancy tenants entered into an agreement to sell after the owner was already committed. They could then play hard-to-gel and hold up the buyer's plans. Any buyer would pay a little more to get on with it. In any case, the difference is so small as not to deserve much importance. It is not possible inmatters of this kind to attain a very high degree of accuracy. I think it is fair to infer that if the agreements to sell had been entered into on the same day, which would be the ideal case, the ratio would have been 50:50. But, even as it stands, the ratio is near enough to that, and corroborates the conclusion of the Additional District Judge, as also, mine.
(87) For the reasons I have stated, all these six appeals are dismissed. Considering that the questions canvassed were not entirely free from difficulty, I leave the panics to bear their own costs.