Behari Lal vs State of Haryana and Another

S.S. Sandhawalia, C.J.—Whether u/s 18(4)(b) of the Punjab Security of Land Tenures Act, the land vests forthwith in the purchasing tenant on the payment of the first instalment by him in pursuance of the order of the trial court, irrespective of the facts that in the subsequent appellate or revision proceedings, the purchase price may be revised, is the primary legal question which arises in these two connected Regular First Appeals.

By the notification u/s 4 of the Land Acquisition Act dated the 8th of September, 1966, the land which is the subject matter of these appeals was sought to be acquired on public expense for the public purpose of the planned development of Sector 25 in the Ballabgarh--Faridabad Controlled Area. Consequently, notification u/s 6 followed and in the subsequent acquisition proceedings, the Collector rendered his Award with respect to the claims made by the various landowners. Dissatisfied with the meagre compensation aswarded, the claimants preferred reference u/s 18 which were consolidated for trial before the Additional District Judge, Gurgaon. The matter of apportionment between Maharaja Harinder Singh and his former tenant Bihari Lal was also referred to the Court u/s 30 of the Land Acquisition Act. These references were contested on behalf of the Respondent-State of Haryana and on the pleadings of the parties, the following issues were struck:

(i) What was the market value of the acquired land on the date of notification u/s 4 of the Land Acquisition Act ?

(2) Whether the Petitioner, namely, Raja Harinder Singh was the owner of the land in question on the date of the above said notification ?

(3) Whether Respondents Nos. 1 to 10 became owners of the acquired land u/s 18 of the Punjab Security of Land Tenures Act. If so, on what date and with what effect ?

Who is entitled to receive compensation and to what extent?

The learned Additional District Judge, in an exhaustive judgment enhanced the compensation awarded to the claimants at two rates of Rs. 150 and Rs. 120 per marla in accordance with the location of the land. On issues Nos. 2, 3, and 4, it was held that with regard to the specific killa Nos. Bihari Lal tenant had become the owner thereof, on the payment of the first instalment of the purchase price determined by the trial court u/s 18(4)(b), that is, on the 12th March, 1963 and consequently on the crucial date of the notification, the title vested in him and, therefore, he alone was entitled to receive compensation therefor.

As regards the issue of the compensation to be granted to the claimants it is unnecessary to advert to the evidence or the judgment under appeal, because the learned Counsel for the parties are agreed, that this matter is completely covered by the judgment in State v. Rajinder Singh, Therein also the land was acquired on the same date for the identical purpose of the planned development Sector 25, Compensation was awarded therein at three varying rates of Rs. 230, 200 and 120 per merla, depending upon the peculiar location of the land. Counsel here are further agreed that the land under acquisition in both these appeals falls in the second category aforesaid. This is otherwise evident from the judgment under appeal where it has been repeatedly mentioned that the land in dispute is well served by the Gaunchhi road. Following State of Haryana v. Bajinder Singh RFA 229 of 1970 decided on 19th February, 1979., we award compensation at a uniform rate of Rs. 200 per Maria to Bihari Lal claimant along with solatium at the statutory rate of 15 per cent and interest at the rate of 6 per cent on the enhanced amount from the date of taking over possession.

Adverting now to the legal issue formulated at the very outset of this judgment, it may be noticed that the matrix of facts is not at all in dispute. Raja Harinder Singh is admittedly a big landlord and it does not seem to be in dispute that he had not reserved the land occupied by Bihari Lal tenant. The latter preferred an application u/s 18 of the Punjab Security of Tenures Act, which was alowed in his favour by the judgment of Shri H. L. Mehra, Assistant Collector 1st Grade, Palwal, on the 4th of March, 1963''. Thereby, it was decreed that on the payment of the compensation specified in the judgment Bihari Lal would be entitled to purchase the land. In pursuance of that judgment, Bihari Lal deposited Rs. 3,447.30 on the 12th of March, 1963, as the first insalment of the purchase price. This is proved on the record by the certificate of the Assistant Treasury Officer. Palwal, Exhibit R/l. Thereafter, an appeal was carried on behalf of Raja Harinder Singh to the Collector, who, by his order Exhibit R/7 upheld the entitlement of the tenant to purchase the land but enhanced the purchase price. An appeal against the order of the Collector before the Financial Commissioner, by the tenant was, however, rejected with the result that the order of the Collector Exhibit R/7 stood effective. Thereafter, Shri Bihari Lal, tenant deposited the balance amount on the 3rd of March, 1969,--vide Exhibit R/4, the relevant treasury receipt.

It appears to be plain from the aforesaid resume of facts that the crucial question herein is whether the title in the land vested in Bihari Lal tenant on the 12th of March, 1963 when he admittedly paid the first instalment in accordance with the order of the trial court or whether such vesting was deferred till he had deposited the amount in accordance with the appellate order exhibit R/7, whereby the purchase price only had been enhanced.

Mr. K. C. Puri, learned Counsel for Raja Harinder Singh had forcefully contended that the first instalment under sestion 18 (4) (b) must be construed as the one after the finalization of all appeals and revisions on the point of the determination of purchase price. It was sought to be submitted that the matter remains contigent and in a flux till it is finally settled by the appellate or the revisional authority and there could be no vesting of the land in the purchasing tenant till then. With commendable candour Mr. Puri has conceded that he could not cite any judgment directly in support of his contention. Mr. H. L. Sarin, on the other hand was equally fair in taking the stand that apart from the judgments noticed hereafter which are only by way of anology, there was no precedent covering the issue on all fours.

In view of the above stand by the learned Counsel, it is evident that the matter has to be first examined on principle and in the light of the relevant statutory provisions. The relevant part of Section 18 of the Punjab Security of Land Tenures Act may, therefore, be read at the very outset:

(1) Notwithstanding anything to the contrary contained in any law, usage or contract, a tenant of a land-owner other than a small land-owner:

(i) who has been in continuous occupation of the land comprised in his tenancy for (a minimum period of six years), or

(ii) who has been restored to his tenancy under the provisions of this Act and whose periods of continuous occupation of the land comprised in his tenancy immediately before ejectment and immediately after restoration of his tenancy together (amounts to six years or more), or

(iii) who was ejected from his tenancy after the 14th day of August, 1947, and before the commencement of this Act, and who was in continuous occupation of the land comprised in his tenancy for a period (of six years or more immediately before his ejectment.)

shall be entitled to purchase from the land-owner the land so held by him but not included in the reserved areas of the land-owner, in the case of a tenant falling within Clause (i) or Clause (ii) at any time, and in the case of a tenant falling within Clause (iii) within a period of one year from the date of commencement of the Act:

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(3) The purchase price shall be three-fourth''s of the value of land as so determined.

(4) (a) The tenant shall be competent to pay the purchase price either in a lump sum or in six-monthly instalments not exceeding ten in the manner prescribed.

(b) On the purchase price or the first instalment thereof, as the case may be, being deposited, the tenant shall be deemed to have become the owner of the land, and the Assistant Collector shall, where the tenant is not already in possession and subject to the provisions of the Punjab Tenancy Act (XVI of 1887) put him in possession thereof.

(c) If a default is committed in the payment any of the instalments, the entire outstanding balance shall, on application by the person entitled to receive it, be recoverable as arrears of land revenue.).

In construing the aforesaid section, one cannot first be oblivious to the fact that it is a provision out of the larger gamut of legislation directed towards agrarian reform. The language used in Clauses (a), (b), and (c) of Sub-section (4) of Section 18 leaves hardly any manner of doubt about the intention of the legislators to forthwith vest the land in the purchasing tenant without delay. Once the purchase application of the tenant has been determined in his favour and the price thereof fixed in accordance with Sub-section (3) then Clause (a) of Sub-section (4) gives the option to the tenant to pay the purchase price either in a lump sum or in six monthly instalments not exceeding ten. It is in the discretion of the tenant to exercise either of the two options and in the eye of law it would make no difference whichever of the two he chooses. This indeed is made plain and explicit by Clause (b) which follows and in no uncertain terms lays down that either on the deposit of the first instalment or the whole of the purchase price in lump sum, the tenant shall be deemed to have become the owner of the land. Therefore, the vesting takes places immediately when exercising one or the other of the options given to him, the tenant makes the deposit. The latter part of Clause (b) is again a pointer towards this immediate vesting. It provides that on such deposit being made, if the tenant is not already in possession, the Assistant Collector shall forthwith put him in possession of the purchased land. Obviously, possession here is meant to follow ownership and it is only because the law, on a deposit being made, vests the ownership in the tenant that the ancillary provision of securing possesion for him by a summary process, has also been itself incorporated in the statute.

The provisions of Clause (c) would further establish this position beyond a shadow of doubt. It provides that once the first instalment has been paid. the land so irrevocably vests in the purchasing tenant that even if he defaults in the payment of the subsequent instalments there would be no divesting or clouding of the title of the tenant, but the only remedy with the land-owner is that he can recover the balance of instalments as arrears of land revenue from the tenant. It seems to be thus evident that on the payment of the first instalment, the matter ceases to be in the volition of the parties and the title vests in the tenant with a consequent divesting of the land-owner irrevocably.

The matter is also capable of being viewed from another angle when it is borne in mind that the relevant provisions are measures of agrarian legislation. If the vesting of land in the tenant was to be made contigent till all the appellate, revisional, or writ jurisdictional proieedings right up to the Supreme Court are finalised then perhaps the vary object and purpose of the early vesting of land in the tenant and his right of purchase given by the statute may well be frustrated. It is apparently with an eye to this object of vesting the land in the tenant expeditiously that the provisions of Sub-section (4) seem to have been enacted.

The view, I am inclined to take, receives tacit support from the earlier Division Bench in Jot Ram v. Shri A.L. Fletcher and Ors. AIR 1965 P.L.R. 187. Though the issue therein was slightly different in so far as the qustion raised was, whether the death of the land-owner would divest a tenant, who has purchased land u/s 18 and paid the first instalment, yet the following observation of Chief Justice Mehar Singh, speaking for the Bench are patently relevant:

In my opinion the argument advanced on behalf of the Petitioners is sound, because, after a tenant has complied with the order of purchase, made by an appropriate authority u/s 18 of the Act, and has made payment in the terms of the order, in accordance with provisions of Section 18(4)(b) of the Act, he is deemed to have become owner of the same. Once he becomes owner of the same, anything happening after that date cannot divest him of the ownership of the land. Of course his right as such owner of the land is subject to his claim having been maintained in appeal, but that is on grounds having arisen and remaining in subsistance to the date of the vesting of the ownership in the tenant. A subsequent event can only divest such a person of ownership of the land if it is so provided in a statute expressly or, in some extreme case, by necessary implication, and neither is the case here. In fact Section 18(4)(b) is indicative of legislative intent to the contrary that on compliance with those provisions a tenant is deemed to have become the owner of the land....

Again Bihari Lal v. Col. His Highness Raja Sir Harinder Singh Barar Bans Bahadur, Ruler of the Former Faridkot State and Ors. 1977 P.L.J. 189., though not directly on the point would, by way of anology tend to buttress the same view.

In fairness to Mr. K. C. Puri, I may notice that he placed primary reliance on Deonandan Prashad Singh v. Ramdhari Chowdhri and Ors. AIR 1916, PC 179. However, that was a case primarily under the pre-emption law, wherein obviously any construction of the statutory provisions of Section 18 of the Act would not obviously arise as the same was not even enacted. That case is, therefore, of no aid whatsoever to the stand taken on behalf of the land-owner.

To conclude on this aspect, it appears to be plain that the subsequent alteration of the purchase price in the appeal or revision proceedings cannot possibly make any difference to the issue of the vesting of ownership in the tenant after the deposit of the first instalment u/s 18(4) of the Act. At best, the enhancement or reduction of the purchase price in the subsequent proceedings would raise a money claim betwixt the tenant and the landowner, but would in no way affect the title of the tenant already irrevocably vested in him. The answer to the question posed at the outset has, therefore, to be rendered in the affirmative.

In the light of the above R.F.A. No. 232 of 1971 is allowed in the terms laid out in paragraph 4 above. R.F.A. 345 of 1971 is consequently dismissed. Parties are, however, left to bear their own costs.