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Himprastha Financiers Private Ltd. and ors. Vs. Union of India (Uoi) and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtHimachal Pradesh High Court
Decided On
Case NumberCivil Writ Petn. Nos. 89, 101 and 114 of 1972
Judge
Reported inAIR1976HP29
ActsDisplaced Persons (Compensation and Rehabilitation) Act, 1954 - Sections 6, 24(4) and 33; ;Displaced Persons (Compensation and Rehabilitation) Rules, 1955 - Rule 90(10) and 90(15); ;Transfer of Property Act, 1882 - Section 41; ;Evidence Act, 1872 - Section 115
AppellantHimprastha Financiers Private Ltd. and ors.
RespondentUnion of India (Uoi) and ors.
DispositionPetition dismissed
Cases ReferredMother Superior. Coimbatore v. Subhanna Goundan.
Excerpt:
(i) property - jurisdiction - section 33 of displaced persons (compensation and rehabilitation) act, 1954 - whether secretary to state government has jurisdiction to change boundaries in sale certificate - when case is covered under provisions of section 33 it is not necessary that a suit be filed for purpose of correcting entries in sale certificate - nominal alteration in certificate by secretary does not take it our of compensation pool. (ii) notice - whether it is necessary for secretary to give notice before taking any action under section 33 - secretary is vested with power of revisional jurisdiction and can exercise all that jurisdiction - no fresh notice necessary to exercise jurisdiction under section 33. - .....hotel (annexe). 3. on 18-11-1955. lot no. (1) central hotel (main building) was purchased by shri kala ram khanna in a public auction for rs. 67,225/-. the sale certificate relating to this property was issued on 29-3-1963 by the competent authority demoting the boundaries of the property sold to shri kala ram khanna as under :(1) east--hillock. (2) west--stables and additional houses. (3) north--m. c. road, (4) south--m. c. road. later on the property was demarcated and shri kala ram khanna was put into possession, of the same. his name was also entered in the revenue records. later on by a registered deed, dated 4-11-1963. shri kala ram khanna released the property in favour of smt. shakuntala kochhar, who has filed the c. w. p. 114 of 1972, stating that the property has been.....
Judgment:
C.R. Thakur, J.

1. These three petitions raise common questions of law and. therefore, they will be disposed of by a single judgment.

2. The Central Hotel Estate Simla, was declared an evacuee property and later it became a part of the compensation pool under the provisions of the Displaced Persons (Compensation and Rehabilitation) Act. 1954 (hereinafter called the Act). This property was divided into four lots for purposes of auction as under:

(i) Central Hotel (Main Building);

(ii) Central Hotel (Addl. Houses just over the Stables):

(iii) Central Hotel (Stables and Servants Quarters): and

(iv) Central Hotel (Annexe).

3. On 18-11-1955. Lot No. (1) Central Hotel (Main Building) was purchased by Shri Kala Ram Khanna in a public auction for Rs. 67,225/-. The sale certificate relating to this property was issued on 29-3-1963 by the Competent Authority demoting the boundaries of the property sold to Shri Kala Ram Khanna as under :

(1) East--Hillock.

(2) West--Stables and Additional Houses.

(3) North--M. C. Road,

(4) South--M. C. Road.

Later on the property was demarcated and Shri Kala Ram Khanna was put into possession, of the same. His name was also entered in the revenue records. Later on by a registered deed, dated 4-11-1963. Shri Kala Ram Khanna released the property in favour of Smt. Shakuntala Kochhar, who has filed the C. W. P. 114 of 1972, stating that the property has been purchased by Shri Kala Ram Khanna as Benamidar on her behalf. After this Shri Kala Ram Khanna and Smt. Shakuntla Kochhar continued to be in possession of the property and the name of Smt Shakuntla Kochhar was duly entered in the Municipal Taxation Registers, revenue records and Property Tax Registers and she continued to pay the taxes, etc.

4. The property known as Central Hotel (Stables and Servants Quarters) was formerly out to auction but it appears that subsequently another sale was held on 10-6-1959 and the property was sold in favour of Shri Dina Nath. A certificate of sale was issued in his favour and the description of the boundaries is given as under:

East--Common Road (passage).

West--Municipal Road.

North--Central Hotel (Addl. House)

South--Municipal Road.

A passage mentioned in the aforesaid schedule giving the boundaries of the property lay between the Central Hotel (Main Building) and the property sold to Shri Dina Nath. Shri Dina Nath later sold the aforesaid property to Shri Kundan Lal Ahuja. respondent No. 7. in C. W. P. 101 of 1972. He constructed a building in an area exceeding 500 square yards. This he managed to do by suggesting to the authorities that the boundaries in the East. i. e. Common Road Passage was somewhat away towards the Central Hotel (Main Building). The then existing common road passage was actually demolished by Shri Kundan Lal Ahuja and consequently there was some dispute between Smt. Shakuntla Kochhar and Shri Kala Ram Khanna on the one hand and Shri Kundan Lal Ahuja on the other hand. Shri Kundan Lal Ahuja filed a suit in the Court of the Senior Subordinate Judge. Simla, for injunction restraining them from interfering with his alleged right of possession on the land stated to have been sold to him and to his predecessor-in-title by the Rehabilitation Department. In their written statement Shri Kala Ram Khanna and Smt Shakuntla Kochhar denied that the common passage was as it was claimed by Shri Kundan Lal Ahuja but on the other hand, the common passage was towards the side where Shri Kundal Lal Ahuja had already put up the construction. The par-ties compromised the aforesaid suit, vide compromise deed, dated 9-9-1965 (copy Annexure PE). According to this compromise. Shri Kundan Lal Ahuja was declared to be entitled to a piece of land lying unbuilt to the extent of three and a half feet in width and running parallel to the constructed building owned by Shri Kundan Lal Ahuja running down to the Municipal Road as per plan attached to the compromise. In other words. Shri Kundal Lal Ahuja's boundary between Central Hotel (Main Building) and Central Hotel (Stables and Servants Quarters) was settled by virtue of the aforesaid compromise.

5. After the boundaries had been settled between the parties, the aforesaid land lying towards East to the Central Hotel (Servants Quarters and Stables) was sold by Smt. Shakuntla Kodhhar to Shri H.D. Sardana, the deceased husband of petitioner No. 1. and the father of petitioners 2 to 7, by a registered sale deed, dated 9-1-1970 (Annexure PJ). Shri Sardana was duly out into possession of the property and he got his plan passed for construction of a house from the proper authorities, i. e. the Simla Municipal Corporation, and later started construction of his house on the land in December. 1970. While the house had been constructed unto the first storey a stay order was served upon late Shri H.D. Sardana on 1-3-1971 from the Court of the Senior Subordinate Judge, Simla, whereby the further construction of the house was staved. This order was passed as Shri Kundan Lal Ahuja had again filed a suit against Shri Sardana and Smt. Shakuntla Kochhar on 1-3-1971. However, at the request of Shri Sardana, the Court vacated the stay order and permitted him to proceed with the construction of the building.

6. It appears that thereafter respondent No. 7 filed a complaint before Shri Surat Ram Mahantan respondent No. 4. who was alleged to be exercising powers of Chief Settlement Commissioner in Himachal Pradesh and he started ex parte proceedings without issuing any notice to late Shri H.D. Sardana or to other interested parties vide his order dated 2-7-1971, the day on which he was to have given charge of his office to his successor and passed an order (Annexure PM) purporting to be under Section 24 of the Act. Against this order also the petitioner moved a petition purporting to be one under Section 33 of the Act. The Secretary, exercising the powers of the Central Government, held that the order of the Deputy Secretary, exercising the powers of the Chief Settlement Commissioner, was without jurisdiction. However, he proceeded to bear the case suo motu and passed the impugned order. Annexure PO.

7. The petitioner in C. W. P. 89 of 1972 also purchased a portion of the aforesaid estate by a registered sale deed, dated 6-10-1967, for a consideration of Rs. 27,000/- from respondents 5 and 6 i. e. Shri Kala Ram Khanna and Smt. Shakuntla Kochhar. The petitioner-company was put in possession of the aforesaid property and it continued to enjoy the property thereafter. In a portion of the vacant land purchased by the petitioner-company, it started construction of a three storeyed building consisting of a basement and two upper storeys, A notice, dated 22-6-1971, from the Under Secretary. Revenue, exercising the powers of the Chief Settlement Commissioner. Himachal Pradesh was received by the petitioner-company on 6-7-1971. It was stated therein that there was a boundary dispute and encroachment of evacuee property, known as Central Hotel Annexure and that the case was fixed for 2-7-1971 at 10 A. M.. in his office. The notice was issued on the complaint of respondent No. 7. who had raised a boundary dispute with Shri H.D. Sardana. a purchaser of the part of the land. As the date of hearing had lone expired when this notice was served on the petitioner-company, the petitioner-company vide its letter, dated 10-7-1971 (Annexure PD) informed Shri Surat Ram Mahantan. Chief Settlement Commissioner that no decision be taken without affording it the opportunity to contest the matter and the company could not appear on 2-7-1971 because the notice was served on it long after the aforesaid date had expired. To that letter the company received no reply. It appears that Shri Surat Ram Mahantan. in post haste, on 12-7-1971 passed an order purporting to be one under Section 24 of the Act where- by he ordered the amendment of the boundaries as given in the sale deed issued to Shri Kala Ram Khanna in respect of the Central Hotel (Main Building) as also ordered the recovery of the arrears of rent. He also recommended action for initiating criminal proceedings as also cancellation of sale of the Central Hotel (Main Building) under Rule 92 of the Displaced Persons (Compensation and Rehabilitation) Rules 1955 (shortly called the Rules).

8. The petitioners filed a review petition before the Chief Settlement Commissioner which was rejected. Thereafter a revision petition under Section 24 (4) read with Section 33 of the Act was made to the Central Government. It appears that the Secretary to the Government of Himachal Pradesh in exercise of the powers of the Central Government under the Act held that the Chief Settlement Commissioner had no jurisdiction to decide the case and. therefore, the orders passed by him were set aside on this technical ground. The secretary exercising the Powers of the Central Government proceeded suo motu to determine the case afresh as is evident from para. 9 of the petition.

9. The petitioners, in all the three petitions have challenged the order dated 16-6-1972, passed by the Secretary to the Government of Himachal Pradesh, exercising the powers of the Central Government under the Act and have prayed for quashing the orders. Further in C. W. Ps. 89 and 101 of 1972 they have prayed for treating them as bona fide purchasers for consideration of the property in dispute. The petitioner, in C. W. P. 114 of 1972 has besides praying for quashing of the order dated 12-6-1972 prayed that she is the owner of the property covered by sale certificate issued by the District Rent and Managing Officer.

10. The respondent No. 7. viz. Shri Kundan Lal Ahuja, filed his return to the C. W. P. 101 of 1972 and the respondents 1 to 4 also filed their return to the same writ petition and all the contesting respondents have tried to defend the orders passed by the Chief Settlement Commissioner as also by the Secretary to the Himachal Pradesh Government.

11. Learned counsel for the petitioners have raised several contentions. The contention that the Deputy Secretary had no jurisdiction does not need any consideration because of the fact that his orders have already been set aside by the Secretary, exercising the powers of the Central Government, as being without jurisdiction.

12. The second question is whether the Secretary had jurisdiction to change the boundaries in the sale certificate.

13. The submission made is that the property had ceased to be a part of the compensation pool after it had been purchased by Shri Kala Ram Khanna in whose favour the sale certificate had also been issued in March 1963. According to the petitioner once the property stood fully disposed of the Central Government ceased to have any power to deal with such property. He has also invited attention to Rule 90 (10) and (15) of the Rules as also the Appendix XXII to these Rules. Besides this reliance is also placed on some authorities in order to show that on the issue of the sale certificate the title to the property had passed and the petitioner became the owner of the land.

14. According to Bombay Salt and Chemical Industries v. L.J. Johnson. (AIR 1958 SC 289) the approval of the auction bid by the Settlement Commissioner brings into existence a binding contract for the sale of the property, and the issue of the sale certificate brings about a transfer of the property. Although the title of the property passes by the issue of the sale certificate, the date on which the title passes is the date of confirmation of the sale, as was pointed out in Bishan Paul v. Mothu Ram. (AIR 1965 SC 1994), and the certificate relates back to the date when the sale became absolute. But the sale certificate cannot be said to pass title in respect of property which was plainly never the subject of the auction. There can be no dispute that Shri Kala Ram, when he participated in the auction proceedings, knew that he was bidding for the Central Hotel (Main Building) only and there was never any understanding that the Central Hotel Annexure was also the subject-matter of the same auction proceeding. The Central Hotel (Main Building) and the Central Hotel Annexe were regarded as two distinct lots for auction. Therefore, when Shri Kala Ram Khanna bid for the Central Hotel (Main Building) and clearly understood that his bid was in respect of that lot only, and the bid was accepted subsequently in respect of that lot and was later confirmed in relation to that lot, the sale certificate was clearly void to the extent that it included the Central Hotel Annexe also. Possession transferred consequent to the sale certificate in respect of the Central Hotel Annexe would not be possession in law and would confer no rights on Shri Kala Ram Khanna. Reliance has been placed by the petitioners on Tek Chand Chitkara v. Union of India, (1968 Delhi LT 284). But that was a case where the suit was for recovery of possession of certain property on the allegation that it was part of a certain property sold to the plaintiff. A case such, as the present one falls within the scope of Section 33 of the Act, and it is not necessary that a suit should be filed for the purpose of correcting the entries in the sale certificate. All along the Central Hotel Annexe remained part of the compensation Pool, and the nominal inclusion in the sale certificate by reference to boundaries of the property covered by the certificate did not take it out of the compensation Pool.

15. Section 33 of the Act is very wide in terms. As the provision suggests, the Central Government enjoys thereby all powers to call for the record of any proceeding and pass such order as in its opinion the circumstances of the case require. It has been urged that the issue of the sale certificate is not a proceeding. In my opinion, the proper construction to be put on the expression 'proceeding' in Section 33 must be such as to give the most comprehensive meaning to that expression, and construed so, it is clear that the expression 'proceeding' in Section 33 must include anything that is done under the Act whether it partakes of a judicial character or is of ministerial nature.

16. The further question is whether it was necessary that the Secretary should have given notice to the petitioners that he was going to act suo motu under Section 33 of the Act.

17. The petitioners invoked the revisional jurisdiction of the Central Government, apparently under Section 24 (4) of the Act against the order of the Settlement Commissioner. The Secretary, exercising the powers of the Central Government, had revisional jurisdiction both under Section 24 (4) and Section 33. By virtue of his revisional jurisdiction being invoked, he was seized of the entire case and it was open to him to pass such orders as the circumstances of the case required. There was nothing to prevent him from exercising the revisional jurisdiction both under Section 24 (4) and under Section 33 for the purpose of effectively disposing of the case. And it was not necessary that he should have given notice to the petitioners that he was going to proceed to dispose of the case under Section 33. The petitioners were already before him having invoked his revisional jurisdiction even though under Section 24 (4), and being before him it was not necessary that they should be notified afresh of his intention to Proceed under Section 33. Both Section 24 (4) and Section 33 confer revisional jurisdiction. the difference being that the jurisdiction under Section 33 is wider than under Section 24 (4). Inasmuch as by virtue of the applications made by the petitioners the Secretary was seized of the entire case, he was competent to exercise all necessary powers vested in him for the purpose of rendering a full and complete adjudication of the case. The petitioners must be presumed in law to have known the extent of the revisional jurisdiction vested in the Secretary, and that he could exercise all that jurisdiction in respect of the case before him. No fresh notice was necessary when he chose to exercise that jurisdiction under Section 33. and reliance in this behalf can also be placed on Ranjit Singh v. The Union of India. (1962-64 Pun LR 44) and Labh Singh Atma Sineh v. Union of India. (AIR 1970 Delhi 171).

18. Next is the question whether the Government was estopped from claiming the property sold to the petitioner.

19. It has been observed above that it cannot be said on the facts of this case that Central Hotel Annexe was ever included in the property auctioned to Shri Kala Ram Khanna. It formed a distinct and separate lot. The Government never represented during the auction proceeding to Shri Kala Ram Khanna that the Central Hotel Annexe was included in the lot for which he was bidding. The sale certificate is void to the extent that it included within the boundaries set out therein, the property comprising the Central Hotel Annexe. In the circumstances the plea of estoppel cannot prevail.

20. The further question is whether Section 41 of the Transfer of Pro-party Act can be invoked.

21. The boundaries in the sale certificate indicated that the Central Hotel Annexe was included in the property sold to Shri Kala Ram Khanna. but when the sale certificate specifically disclosed that it was only the Central Hotel (Main Building) which had been sold to him there was an apparent discrepancy between the description of the property by name and its delineation by boundaries. The transferees should have made further enquiry for the purpose of ascertaining whether the property proposed to be transferred to them was indeed the property of the transferor. In failing to do so the transferees cannot be said to have taken reasonable care within the meaning of Section 41 of the Transfer of Property Act to ascertain that the transferor had power to make the transfer. The learned counsel for the petitioners had placed reliance on Sadia Hussein v. Co-operative Central Bank. Yeotmal. (AIR 1952 Nag 106), and The Catholic Mission Presentation Convent by Mother Superior. Coimbatore v. Subhanna Goundan. (AIR 1948 Mad 320). The principle laid down in these authorities is that the transferee is to prove that the transferor is the ostensible owner: that he is clothed with the insignia of ownership with the consent, express or implied, of the real owner; that the transfer is for consideration and that the transferee has acted in good faith taking reasonable care to ascertain that the transferor had power to transfer, and if any one of these elements is absent, the transferee is not entitled to the benefit of this section. There can be no dispute with the principles laid down in these authorities. But in view of the circumstances of the present case, the transferees cannot invoke the aid of Section 41 of the Transfer of Property Act.

22. In the above circumstances, the petitions fail and the same are hereby dismissed with costs, assessed at Rs. 200/-.

R.S. Pathak, C.J.

I agree.


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