Skip to content


Associated Cement Co. Ltd. Vs. State of Gujarat 7 ors. - Court Judgment

LegalCrystal Citation
SubjectContract;Property
CourtGujarat High Court
Decided On
Judge
Reported in(1979)2GLR513
AppellantAssociated Cement Co. Ltd.
RespondentState of Gujarat 7 ors.
Excerpt:
- .....the company had entered into the agreement with the said talukdar on 19-7-1948. under that agreement (annexure 'a'), the talukdar had undertaken the liability to permit the petitioner company to draw water in the specified quantity every day for the period of 30 years against the promise of the company to pay rs. 1000/- per month to the talukdar in return as consideration. the talukdari estate which the thakore saheb of sonipur held come to be liquidated with effect from 1-10-1963 pursuant to the gujarat surviving alienations abolition act, 1963. the state government thereafter asserted its right to this kaldhera pool and the executive engineer, mahi irrigation scheme, s. i, having his office at thasra, sent a bill to the petitioner-company for water drawn from the said pool with.....
Judgment:

N.H. Bhatt, J.

1. This is a petition by the Associated Cement Company Ltd. against the State of Gujarat and other officials of the state challenging the order of the Executive Engineer calling upon the petitioner company to pay up the sum of Rs. 4,38,945/- as the charges for water drawn by the petitioners-company from Kaldhera Pool, situated at Sevalia Taluka of Thasra in Kaira District, for the period between 1-10-1963 to 30-6-1971, as detailed in Annexure 'C to the petition.

2. The petitioner company is engaged in manufacture of cement and has its factories at various places, including the one at Sevalia in Kaira District. In the year 1948, the company appears to have established its factory at Sevalia and for that purpose the Company was in need of regular supply of water. The Kaldhera Pool so known, is a site having the continuous flow of water from Mahi River and the said area was at that time under the Revenue jurisdiction of the Talukdar of Sonipur who was known as the Thakore Saheb of Sonipur. The Company had entered into the agreement with the said Talukdar on 19-7-1948. Under that agreement (Annexure 'A'), the Talukdar had undertaken the liability to permit the petitioner company to draw water in the specified quantity every day for the period of 30 years against the promise of the company to pay Rs. 1000/- per month to the Talukdar in return as consideration. The Talukdari estate which the Thakore Saheb of Sonipur held come to be liquidated with effect from 1-10-1963 pursuant to the Gujarat Surviving Alienations Abolition Act, 1963. The State Government thereafter asserted its right to this Kaldhera Pool and the Executive Engineer, Mahi Irrigation Scheme, S. I, having his office at Thasra, sent a bill to the petitioner-company for water drawn from the said pool with effect from 1-10-1963 at the government rates. The Collector was approached and he by his order (Annexure 'B') dated 7-8-1971 upheld the stand of the Executive Engineer. The matter was then carried to the Special Secretary and the Special Secretary by his order (Annexure 'E') dated 31st May, 1976 rejected that revision-cum-appeal preferred by the petitioner-company. Within a few days thereafter, the company filed this petition.

3. Mr. I.M. Nanavaty, the learned advocate for the petitioner-company, at the out-set conceded that the alienation in favour of the Thakore Saheb of Sonipur stood abolished and extinguished on the from 1-10-1963. In other words, it is no longer in controversy before me that the Talukdari Estate was covered by the Gujarat Surviving Alienations Abolition Act, 1963. Mr. Nanavaty further conceded that on and from 1-10-1963 which was the appointed day, the said Talukdari Estate came to be abolished by virtue of Section 6. His grievance however was that by virtue of Sections 11 and 29 of the said Act, the liability incurred by the Thakore prior to the abolition of the alienation survived and therefore the petitioner company was entitled to draw water at the agreed rale of Rs. 1000/- per month at least till 19-7-1978, the day on which the stipulated period of 30 years would come to an end. The short question that therefore falls to be determined in this petition is whether the petitioner's right survived the abolition or extinction of the estate by any provisions of law. Mr. M.B. Shah, the learned Assistant Government Pleader, appearing for the State of Gujarat, placed heavy reliance on Section 6 and urged that by the absolute mandate contained in that Section 6 and particularly Clause (b) thereof, the petitioner's alleged right stood abrogated on and from 1-10-1963, and Mr. Nanavaty on the other hand pleaded that Section 29 saved the drastic operation of Section 6 of the Act. It is, therefore, necessary to reproduce Section 6 and Section 29 below in their entirety:

6. 'Notwithstanding any usage or custom, settlement, grant, agreement, sanad or order or anything contained in any decree or order of a court or any law for the time being applicable to any alienation, with effect on the from the appointed day-

(a) all alienations shall be and are hereby abolished;

(b) save as expressly provided by or under this Act, all rights legally subsisting on the said day under such alienations and all other incidents of such alienations (including any right to hold office, or any liability to render service appertaining to an alienation) shall be and are hereby extinguished;

(c) subject to the other provisions of this Act, all alienated lands shall be, and are hereby made liable to the payment of land revenue in accordance with the provisions of the Code and the rules made thereunder: and accordingly the provisions therein relating to unalienated land shall apply to all alienated lands.

29, Nothing contained in this Act shall affect any obligation or liability already incurred under an accident of an alienation before the appointed day, or any proceeding or remedy in respect of such obligation or liability, and any such proceeding may be continued and remedy enforced as if this Act had not been passed.

It cannot be gainsaid that by virtue of Section 6 all the alienatiions stood abolished notwithstanding any usage or custom, settlement, grant, agreement, sanad or order or anything contained in any decree or order of a court or any law for the time being applicable to any alienation. Even Mr. Nanavaty concedes to this legal position. Mr. Shah then particularly invited my attention to Clause (b) quoted above and submitted that the petitioner's rights that were legally subsisting on the appointed day under such alienation or under incident of such alienation were ordained by the Legislature to be extinguished forthwith. It is to be noted with pertinence that this operation of all subsisting rights is 'save as expressly provided by or under this Act'. If there is anything in this Act speaking to the contrary, the drastic operation of Clause (b) would not arise. Section 29 requires to be therefore again approached. It says in clear and unambiguous terms that any obligation or liability already incurred under an incident of an alienation before the appointed day shall not be affected by anything contained in the Act including Section 6. It was the obligation of the Talukdar to allow the petitioner company to go on drawing water from the Kaldhera Pool, of course subject to the liability of the petitioner-company to go on paying Rs. 1000/- per month as consideration. The term 'obligation or liability' occurring in Section 29 is not limited in its import to monetary liability as Mr. Shah tried to urged before me. The term 'obligation or liability' therefore is to be imported its natural dictionary meaning and it would obviously include the contractual liability which was incurred by the Thakore of Sonipur under the incident of alienation. The incident of alienation is the power of the alienee to grant leases. It is, therefore, clear that Section 29 saves the liability incurred by the alienee prior to the appointed day and this liability will continue to remain attached to the property. Mr. Shah's submission however was that Section 6 spoke of its operation notwithstanding any agreement and his submission therefore was that all agreements stood rescinded by operation of law. It is difficult to accept this submission of his. The words 'Notwithstanding any usage or custom,...agreement...'contained in the initial part of Section 6 are limited to the agreement speaking of something contrary to extinction or alienation or the subsistance of its legal rights or the exemption of the alienated lands from the liability to pay the land revenue in accordance with the provisions of the Land Revenue Code and the rules made thereunder. Section 6 nowhere lays down that all agreements of any nature whatsoever entered into between the Talukdar on the one hand and the third party on the other stood rescinded by statutory force.

4. Reading Section 6 with Section 29 of the Act, I find that the liability incurred by the Talukdar or the Thakore Sahen of Sonipur continued to remain operative despite extinction, and the respondents were not justified in claiming from the petitioner more than what he was bound to pay under the contract to the Talukdar as long as the contract subsisted. In other words, the inflated claim made by the State in Annexure 'C is unjustifiable.

Mr. Shah's one more submission also deserves to be noted for rejection. He submitted that by virtue of the mandate of Section 6 of the Act, rights legally subsisting were abolished though liability under Section 29 might be surviving. It is platitudinous to say that liability survives but the right does not. Liability and rights are two sides of one coin and if the liability survives, it is a necessary corollary to say that even the right survives.

5. The petition is, therefore, entitled to succeed and is allowed. A writ is directed So be issued quashing the order (Annexure 'B') dated 7th August, 1971 and the order Annexure E and restraining the respondents from recovering the amounts of the bills (Annexure 'C'). Rule is accordingly made absolute with no order as to costs.

Mr. Shah prayed for the suspension of the operation of this judgment for a period of one month from today, but Mr. I.M. Nanavaty, for the petitioner, volunteered that the bank guarantee furnished by the petitioner-company shall not be got discharged by the company for the period of one month from today. On this assurance being given by Mr. Nanavaty, the operation of the judgment and order is not required to by stayed.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //