Beasan Devi vs Ishwar Dass and Others

R.S. Thakur, J.—This Letters Patent Appeal is directed against the judgment passed by the learned single Judge of this Court, Chet Ram Thakur, J, in R.S.A. No. 52 of 1969 dated May 4,1971, whereby the appeal of the present appellants Smt. Beasan Devi ana Ors. against the Respondents Duni Chand and Ors. was dismissed with costs.

The appellants or their predecessors-in-interest were the Defendants in the first Civil Court, that is, the Court of the Senior Sub-Judge, Dharamsala, whereas the Respondents or their prodecessors-in-interest were the plaintiffs and they would hereinafter be referred to as such.

The facts are that thp Defendants filed an application before the Collector (Revenue Officer), Dharamsala, on February 11, 1963, u/s 4 of the Restitution of Mortgaged Lands (Punjab) Act, 1938, hereinafter called as the Restitution Act, before the integration of Kangra district with Himachal Pradesh for restitution of possession of certain lands which according to the Defendants mortgagors had been mortgaged usufructuously with the plaintiffs. The plaintiffs contested that application and the main objection which appears to have been set forth on their behalf was that the mortgage was barred by limitation under Article 148 of the Limitation Act but the learned Collector vide his order dated November 26, 1964 repelled that contention and held that the application for restitution of possession was within limitation and he ordered the restitution of possession of the said land in favour of the Defendants (mortgagors) without payment of any mortagage consideration as, according to the Collector, the plaintiffs (mortgagees) had realised benefits valuing more than the mortgage amount out of the usufruct of the said land.

The plaintiffs then instituted a Civil suit in the Court of the Senior Sub-Judge, at Dharamsala, on December 19, 1964, against the Defendants whereby they sought declaration to the effect that the land in question having been in possession of the plaintiffs as mortgagees for a period of more than 60 years the same had become time barred thus resulting in the extinction of all rights of the mortgagors in the said land under the mortgage and the plaintiffs have become owners and were in possession thereof. They also sought permanent injunction against the Defendants restraining them from interfering with their possession of the suit land.

The Defendants contested that suit wherein they inter alia raised two preliminary objections, namely, that since the Defendants obtained the possession of the suit land through Collector, the suit for declaration and permanent injunction was not competent, and secondly that the Civil Court had no jurisdiction to try the suit.

The learned Senior Sub-Judge, however, repelled these objections and decreed the suit of the plaintiffs vide his judgment dated May 13, 1966. While dealing with the first objection the learned Senior Sub-Judge, found that the possession of the land in question was taken by the Defendants on December 20, 1964 whereas the suit was instituted on December 19, 1964 and as such the suit at the time of the institution was competent. As regards the second objection, it was observed that since at the time of making the application by the Defendants for restitution of possession of the suit land u/s 4 of the Restitution Act, the mortgage had become time barred and the plaintiffs-mortgagees had become owners thereof, the Collector had no jurisdiction to entertain the application under the Restitution Act and, therefore, his order for restitution of the possession of the land in question was a nullity and as such the Civil Court had jurisdiction to try the suit.

The Defendants then took the matter in appeal to the District Judge, Kangra at Dharamsala, and the learned Additional District Judge then vide his judgment dated May 24, 1969, also affirmed the findings of the Senior Sub-Judge and dismissed the appeal.

The second appeal filed by the Defendants in this Court against the judgment of the learned Additional District Judge also met the same fate, as stated earlier, and hence this Letters Patent Appeal.

At the time of arguments before us the learned Counsel for the Defendants (Appellants) has raised the same preliminary objection, viz. that the Civil Court had no jurisdiction to enter tain the suit and that all the concerned courts including the single Judge of this Court have erred in holding that the Civil Courts had jurisdiction to entertain the suit.

The learned Counsel for the plaintiffs on the other hand contended that there is no force in the preliminary objec tion. The contention of the learned Counsel for the plaintiffs is that the Courts so far have rightly held that the jurisdiction of the Collector under the Restitution Act to entertain the application u/s 4 would be valid only in case the mortgage is subsisting at the time of institution of the applica tion before him and that in case it is not subsisting at that point of time, the Collector would have no jurisdiction to enter tain the same. In the instant case, as per the learned Counsel, since the Courts have rightly found that at the time of the institution of the application by Defendants before the Collector on February 11, 1963, the mortgage in question had become hopelessly time barred, the same was not subsisting and as such the Collector had no jurisdiction to entertain that applica tion and the order passed by him for restitution of possession in favour of the Defendants was non-est and in these circums tances it was the Civil Court which had jurisdiction to entertain the suit as instituted by the plaintiffs in the Court of the Senior Sub-Judge, Dharamsala.

At this stage it would be proper to take note of the salient features of the Restitution Act.

Section 2 of the Restitution Act lays down that notwithstanding anything contained in any enactment for the time being in force, this Act, shall apply to any subsisting mortgages of land, which were effected prior to 8th June, 1901 qua the territories comprised in the State of Punjab immediately before 1st November, 1956.

Section 3 of the Restitution Act relates to the definition which inter-alia defines the Collector and the Commissioner as meaning those who are of the District and Division respectively in which the mortgaged property or any part thereof is situate. The �mortgagor and mortgagees� include their assignees and the representatives-in-interest.

Then Section 4 thereof lays down as under:

A mortgagor to whose land the provisions of this Act apply, may at any time present a petition 4;o the Collector praying for restitution of possession of the land mortgaged. The petition shall be duly verified in the manner prescribed for such petitions.

Then Section 5 thereof requires that on the institution of such a petition the Collector, after such enquiries as may be prescribed, shall record an order in wtiting with reasons stating whether the mortgage in question is one to which this Act applies. If his findings are in the negative then he has to dismiss the petition u/s 6 of the Restitution Act and if it is in the affirmative, he has to proceed in accordance with the provisions of Section 7 of the Act, that is to day, he has to pass a speaking order and give a finding whether the value of the benefits enjoyed by the mortgagee while in possession of the mortgaged land equal or exceed twice the amount of the principal sum originally advanced wider the mortgage and in case he conies to this conclusion he has to order that the mortgage be extinguished and the possession of the mortgaged land be restored to the mortgagor without payment of any mortgage amount. If according to his findings, the benefits enjoyed by the mortgagee are less than twice of the principle sum originally advanced, then he has to proceed under the provisions of subsection (2) of Section 7 of the Restitution Act. u/s 8 of the Restitution Act the Collector is required to order the extinguishment of the mortgage and the restitution of possession of the property mortgaged in favour of the mortgagor together with the documents of title relaring thereto and also call upon the mortgagor to deposit any amount if found due to the mortgagee u/s 7 (2) of the Restitution Act.

u/s 9 of the Restitution Act the Collector is empowered to restore the possession of the mortgage property to the mortgagor and; for this purpose he is vested with powers under Order XXI Rules 97 and 98 of the Civil Procedure Code.

Then Section 16 of the Restitution Act lays down that an appeal shall lie from the original or appellate order made under this Act:

(a) to the Gornmisstoner when the order is made by a Collector; (b) to the Financial Commissioner when the order is made by a Commissioner:

Provided that When an original order is confirmed on first appeal a further appeal shall not lie.

Section 10-A of the Restitution Act then provides for revision as follows:

The Financial Commissioner may, at any time, of his own motion or on application made, call for the record of any case pending or decided under this Act and may in any such case pass such order as he thinks fit:

Provided that he shall not under this section pass any order reversing or modifying any proceedings or order without giving the person concerned an opportunity of being heard.

Section 11 of the Restitution Act provides for limitation of appeal to the Commissioner and Financial Commissioner as sixty days and ninety days respectively.

Sub-section (2) thereof provides for exclusion of the time taken in obtaining copy of the order appealed against while computing the period of limitation for an appeal while under sub-section (3) thereof provisions of Section 5 of the Indian Limitation Act have been made applicable to all appeals under this Act.

Then Section 12 of the Restitution Act lays down as under:

No civil Court shall have jurisdiction to entertain any claim to enforce any right under a mortgage declared extinguished under this Act, or to question the validity of any proceedings under this Act.

Section 13 of the Restitution Act which is the last Section, empowers the State Government to make Rules for the purposes of giving effect to the provisions of this Act.

This is a trite proposition of law that the jurisdiction of the Civil Court is all embracing except in those cases where it is either expressly or by necessary implication intended to be barred by any law.

Now the only question that arises for determination of this Court in this appeal is whether in view of the Restitution Act and more particularly Section 12 thereof whereby the jurisdiction of Civil Court is barred in express terms, the Civil Court had jurisdiction to entertain the suit in question after the matter in issue in the suit was previously litigated by the parties under the Restitution Act? This question, in our opinion, has now been finally settled by a Constitution Bench of the Supreme Court vide its judgment reported in Dhulabhai and Others Vs. The State of Madhya Pradesh and Another, It appears that at that time there were several appeals pending in the Supreme Court in which this very question was involved and since doubt was felt as to the correct position of law on the point in view of several judgments of the Supreme Court in different cases, a necessity was felt to have a categorical verdict of a Bench of five learned Judges thereon. Their Lordships of the Supreme Court in that judgment then took note of two judgments of the Judicial Committee in AIR 1940 105 (Privy Council) Releigh Investment Co. Ltd. v. Governor General in Council and also several subsequent rulings of the Supreme Court, namely Firm and Illuri Subbayya Chetty and Sons Vs. The State of Andhra Pradesh, The Provincial Government of Madras Vs. J.S. Basappa, Kamala Mills Ltd. Vs. State of Bombay, Bharat Kala Bhandar Ltd. Vs. Municipal Committee, Dhamangaon, K.S. Venkataraman and Co. Vs. State of Madras, and The Pabbojan Tea Co. Ltd., etc. Vs. The Deputy Commissioner, Lakhimpur, etc., having bearing on the question at issue and then deduced the following conclusions:

(1) where the statute gives a finality to the orders of thespecial tribunals the civil court�s jurisdiction must be held to be excluded if there is adequate remedy to do what the civil courts would normally do in a suit. Such provision, however, does not exclude those cases where the provisions of the particular Act have not been complied with or the statutory tribunal has not acted in conformity with the funds-mental principles of judicial procedure.

(2) Where there is an express bar of the jurisdiction of the court, an examination of the scheme of the particular Act to find the adequacy or the sufficiency of the remedies provided may be relevant but is no decisive to sustain the jurisdiction of the civil court.

Where there is no express exclusion the examination of the remedies and the scheme of the particular Act to find out the intendment becomes necessary and the result of the inquiry may be decisive. In the latter case it is necessary to see if the statute creates a special right or a liability and provides for the determination of the right or liability and further lays down that all questions about the said right and liability shall be determined by the tribunals so constituted, and whether remedies normally associated with actions in civil courts are prescribed by the said statute or not.

(3) Challenge to the provisions of the particular Act as ultra vires cannot be brought before Tribunals constituted under that Act. Even the High Court cannot go into that question on a revision or reference from the decision of the Tribunals.

(4) When a provision is already declared unconstitutional or the constitutionality of any provision is to be challenged, a suit is open. A writ of certiorari may include a direction for refund if the claim is clearly within the time prescribed by the Limitation Act but it is not a compulsory remedy to replace a suit.

(5) Where the particular Act contains no machinery for refund of tax collected in excess of constitutional limits or illegally collected a suit lies.

(6) Questions of the correctness of the assessment apart from its constitutionality are for the decision of the authorities and a civil suit does not lie if the orders of the authorities are declared to be final or there is an express prohibition in the particular Act. In either case the scheme of the particular Act must be examined because it is a relevant enquiry.

(7) An exclusion of the jurisdiction of the civil Court is not readily to be inferred unless the conditions above set down apply.

The instant case, in our opinion, is fully covered by the first and the second conclusions reproduced above and more particularly the first one. The Restitution Act, the provisions whereof have been noticed in the earlier part of this judgment, gives a clear indication that this is a complete statute. As soon as a petition is instituted before the Collector u/s 4 of the Restitution Act the Statute enjoins upon him to hold an enquiry whether the mortgage was a subsisting one in accordance with the provisions of Section 2 thereof and naturally this enquiry is embarked upon after the other party has appeared and tendered its objections and thereafter the Collector is also required to give a finding by a speaking order not only that the mortgage in question was a subsisting one but also whether the mortgagee has reaped benefits from the mortgaged property which disentitled him from claiming back the sum advanced as mortgage consideration or it is partly due and, if so, to what extent. Thereafter the order would direct the mortgagor to deposit the amount to the mortgagee, if found due, and would also declare the extinguishment of the mortgage and the restitution of possession thereof to the mortgagor. The Collector is further empowered to resort to the relevant provisions of the CPC for restoring possession to the mortgagor. Then it also categorically vests the right of appeal in a party adversely affected from the order of the Collector to the Commissioner and further to the Financial Commissioner in case of connecting findings of the Collector and the Commissioner and further also a right of revision before the Financial Commissioner. Then, as already observed, vide Section 12 of the Restitution Act, the jurisdiction of Civil Court is in terms barred to enforce any right under a mortgage declared as extinguished under the Restitution Act or to question the validity of any proceedings under this Act.

Thus, in our opinion, since this Statute not only lays down the proper procedure by way of an enquiry as to whether there was a subsisting mortgage but also vests right in a party adversely affected to go in appeal or in revision before the higher revenue-authorities the tests laid down in conclusion first and second of the Supreme Court judgment cited supra are fully satisfied. As is apparent from the pleadings of the parties, the vires of the Restitution Act or any provision thereof has not been challenged in any manner in the civil suit nor has it been the case of the plaintiffs at any time during the course of this long drawn out litigation that the statutory tribunal under the Restitution Act, that is, the Collector, had not acted in accordance with the fundamental principles of judicial procedure.

The only grouse of the plaintiffs while instituting the suit was that the Collector had wrongly held that the mortgage in question was within limitation at the time when the petition u/s 4 of the Restitution Act was made by the Defendants. On the same basis it was held by the original as well as the appellate courts that since at the time of the petition the mortgage had become time barred the same was not subsisting and the Collector, therefore, had no jurisdiction to entertain the petition under the Restitution Act and as such his order being non-est it was the civil Court alone which had the jurisdiction to entertain the suit. This in fact was also the precise contention of the learned Counsel for the plaintiffs before us as well.

We, however, feel that this finding returned by the courts concerned as also the contention of the learned Counsel for the plaintiffs have no validity. When the Collector embarks upon an enquiry in consonance with the provisions of Section 5 of the Restitution Act as to whether the petition made before him was one to which this Act applies; he has to hold whether the mortgage was subsisting and he is required to return a finding whether the mortgage was within limitation as indeed he has done in the instant case on the issue being raised by the plaintiffs. We are of the opinion that the determination of this question of limitation was very much within the competence and jurisdiction of the Collector as it squarely fell within the four corners of the Restitution Act. It may be that he had taken wrong view of the fact or the law on the point and has erroneously come to a conclusion that the mortgage was within limitation or a subsisting one. But in our view that does not have the effect of ousting the jurisdiction of the Collector to give a finding on such a point as he has done or making his order non-est. The question is whether, assuming that this finding of the Collector on the point of limitation was patently wrong, there was any remedy provided by the Restitution Act to get this erroneous finding rectified ? The answer to this poser is certainly in the affirmative since the plaintiffs had a right to go in appeal to the Commissioner against this order u/s 10 of the said Act and obviously the plaintiffs failed to avail of the benefit of this provision but rather preferred to institute the suit in the Civil Court. The provisions of Section 12 of the Restitution Act, however, put a complete embargo and prohibition against such action. The civil suit, therefore, deserved to be dismissed for lack of jurisdiction in the Civil Court. Although this ruling of the Supreme Court very much held the field when the judgment impugned before us was passed, but apparently none drew the attention of the learned single Judge to the same which thus has resulted in erroneous finding.

It may also be stated in passing that the suit of the plaintiffs appears to be defective. It is for declaration that the mortgage in question stood extinguished and the plaintiffs were owners in possession of the mortgage land and there was a further prayer as an ancillary relief for restraining the Defendants permanently from interfering with their possession on this land. The Defendants had raised an objection that the suit was not competent since they had obtained possession of the land in question by virtue of the order of the Collector on their petition u/s 4 of the Restitution Act and the plaintiffs were not in possession of the suit land. The Senior Sub-Judge, then, has returned a finding that this objection was not sustainable since the suit was instituted by the plaintiffs on December 19, 1964 whereas they were dispossessed by the Defendants from the suit land by virtue of the Collector�s order on December 20, 1964. It is, however, admitted that the plaintiffs thereafter at no point of time either amended the plaint so as to include the relief for possession of the land by way of consequential relief nor did they after December 20, 1964 regained the possession of the suit land and we feel that in these circumstances it is doubtful whether the suit of the plaintiffs in the present form was competent. However, since the suit of the plaintiffs is liable to be dismissed on the sole ground that the Senior Sub-Judge at Dharamsala or any civil Court for that matter, had no jurisdiction to entertain the suit, we do not propose to resort to dilation on this aspect of the case.

In view of the above discussion, the appeal is accepted and the judgment in the R.S.A. of the learned single Judge dated May 4, 1971, the judgment in the first appeal of the Additional District Judge, Dharamsala, dated May 24, 1969, and that of the Senior Sub-Judge, Dharamsala, dated May 13, 1966 are set aside and the suit of the plaintiffs is dismissed. In the circumstances of the case, however, the parties are left to bear their own costs throughout.