Mehanga Ram vs Financial Commissioner and Others

S.K. Jain, J.—Property No. 1976/11, inside Hathi Gate, Gali Loharanwali, Amritsar, was allotted to Smt. Durga Devi, mother of respondent No. 4, who was a displaced person from Pakistan, in the year 1950. She continued to be in possession throughout. Vide agreement dated 16.1.1963 (Annexure P-l), it was transferred in her favour in lieu of Rs. 3,324/-. She paid Rs. 665/- in cash as earnest money. The balance amount of Rs. 2659/- was agreed to be paid by her in seven yearly instalments and the first instalment had to fall on 14.1.1964. She paid few instalments. But subsequently on her having committed default in payment of further instalments, the Managing Officer cancelled the transfer without affording her any opportunity of being heard. She challenged the said order of cancellation by filing an appeal before the Settlement Commissioner who accepted the same vide his order dated 23.8.1969. She deposited Rs. 770/- alongwith three more instalments, two being of Rs. 380/- each and the 3rd of Rs. 400/- pertaining to the year 1964-65 and 1969. It was directed that the Managing Officer will determine the balance amount which would be paid by her by 15.9.1969, failing which the property in question would be sold by public auction. The Managing Officer vide registered notice dated 20.1.1970 called upon her to pay the balance amount without specifying any amount. Subsequently notices dated 31.12.1974, 14.2.1975 and 13.10.1977 were also put in the course of postal transmission to her address.

The petitioner claiming to be the occupant of the said property for about seven years, applied to the Department for allotment of the same in his favour. The Naib Tehsildar-cum-Managing Officer, Amritsar recommended to the Settlement Officer-cum-Managing Officer for transfer of the said property in favour of the petitioner, he being in its exclusive possession and a displaced person. Accepting the said recommendations, the Settlement Officer transferred the property in question in favour of the petitioner for Rs. 9,556/-. The entire amount having been paid conveyance deed was issued in his favour on 14.9.1978.

Chaman Lal, claiming to be the legal representative of Shri Durga Devi, filed an appeal against the order dated 24.10.1973 passed by the Managing Officer (Headquarters), Jullundur vide which his claim was rejected. The Settlement Commissioner dismissed the appeal vide his order dated January 9, 1979. Then he preferred a revision u/s 24 of the Displaced Persons (Compensation & Rehabilitation) Act, 1954 (for short ''the Act'') against the said order of the Settlement Commissioner. The Chief Settlement Commissioner Punjab Rehabilitation Department, Jullundur vide his order of May 4,1979 accepted the revision.

The petitioner then filed an application u/s 33 of the Act against the above said order before the Financial Commissioner Revenue and Secretary to Government, Punjab, Rehabilitation Department with delegated powers of Central Government. He dismissed the said application holding that there was no ground for resumption and the balance sale price could be recovered as arrears of land revenue. Even if Mehnga Ram was a bona fide purchaser the property of someone else could not be transferred to him. The failure on the part of the department to inform Smt. Durga Devi as to what was the balance amount to be paid by her had resulted in this litigation.

The above said orders of respondents No. 1 to 3 have been challenged by Mehnga Ram by way of this Civil Writ Petition under Articles 226 an 227 of the Constitution of India.

The Department filed written statement supporting the impugned orders. The case came up for hearing before J.V. Gupta, J. (as his Lordship the Chief Justice then was) and following order was passed on May 8, 1989:-

" At the time of motion hearing itself it was observed that there is conflict of opinion in this Court regarding the action to be taken by the Rehabilitation Department in case of default of payment of any instalment when a property is transferred to a person in auction. The Financial Commissioner (Revenue) and Secretary to Government, Punjab, Rehabilitation Department, with delegated powers of Central Government, relied upon Inder Singh v. Financial Commissioner, Taxation, Punjab, and Ors. 1973 P.LJ. 600. The learned counsel states that a contrary opinion to that has been expressed in CWP No. 4479 of 1973 (Sohan Singh v. Financial Commissioner (Taxation) Punjab, and Ors.) decided by D.S. Tewatia, J. (as his Lordship then was) on 13.7.1982. This position is not disputed by the learned counsel for the parties. Thus, there being a conflict of opinion in this Court, the case is to be decided by a larger bench in order to resolve the controversy.

It is, therefore, directed that the case may be placed before Hon''ble the Chief Justice for constituting a larger Bench."

That is how this writ petition has come up before us.

Learned counsel for the petitioner has vehemently argued that Smt. Durga Devi was allotted the property in question as a result of an agreement dated 16.1.1963 (Annexure P-l), in which it was clearly stipulated that she was to make the balance payment in seven yearly instalments and if she failed to pay the instalments by due dates or failed or neglected to perform and observe any of the terms, conditions and covenants of the agreement then the department would be at liberty to determine the agreement, resume possession of the property, evict her and forfeit the instalments paid and, therefore the order of Managing Officer cancelling the transfer in her favour was valid and legal and all subsequent orders impugned in this writ petition was illegal and without jurisdiction. In support of his contention, he has relied upon the judgment rendered by a Single Bench of this Court in Sohan Singh v. Financial Commissioner (Taxation) Punjab, Civil Writ Petition No. 4479 of 1973 decided on July 13,1982.

In reply the learned counsel for the respondent has submitted that the property in dispute was transferred in favour of Smt. Durga Devi, a displaced person under Rule 29 of the Displaced Persons (Compensation and Rehabilitation) Rules, 1955 and even if there was a. default in payment of instalments due on the property, the property could not be resumed and re-auctioned. He has placed great reliance on the ratio laid down by another Single Bench of this Court in Inder Singh v. Financial Commissioner, Taxation, Punjab 1973 PLJ 600.

We have examined the writ petition, the written statement, the agreement (Annexure P-l), judgment of Chief Settlement Commissioner, Punjab, Rehabilitation Department dated 4.5.1979 (Annexure P-2), judgment of Financial Commissioner, Revenue dated 4.5.1982 (Annexure P-3) and the judgment in Civil Writ Petition No. 4479 of 1973 and that rendered in Inder Singh''s case (supra).

Ratio laid down in Sohan Singh''s case (supra), cannot be granted on the facts and circumstances of this case. In that case even after the settlement Commissioner had allowed the appeal against the cancellation of the allotment and had directed the petitioner to deposit the amount due by 8.6.1970 the petitioner had not deposited the amount and had challenged the said order through a revision petition which was dismissed by the Chief Settlement Commissioner. His further petition u/s 33 of the 1954 Act had also been dismissed. But here in this case, the order of the Managing Officer (T) dated 15.1.1969 cancelling the transfer in favour of Smt. Durga Devi was set-aside in appeal by the Authorised Settlement Commissioner, on 23.8.1969 holding that she had made payment of almost all the belated instalments. He had, therefore, directed the Managing Director-Officer (T) to determine the balance amount which be deposited by her by 15.9.1969. From the order (Annexure P-2) it is also evident that no legal notice whatsoever was sent to Smt. Durga Devi by the Managing Officer. Last notice dated 20.1.1970 did not indicate the amount required to be paid by her. There is no proof on the file whether that notice was delivered to her. Smt. Durga Devi having died in the year 1972, notice issued in the years 1974, 1975 and 1977 in her name were of no effect. Furthermore, it was observed in the said order that Mehnga Ram (present petitioner) had filed a petition for the transfer of the property on 3.4.1974, claiming to be its sole occupant since 1967. Had this been so, he must have been a party to the proceedings pending before the Managing Officer (T) of the Central Government, who had been dealing with the case till 1970. After taking the over all view of the case, the learned Chief Settlement Commissioner, Punjab had concluded as under:-

" In view of the above discussion, I find that, in this case, injustice has been done to the petitioner, whose deceased mother had paid almost the entire amount against the transfer of this property in the year 1969, but in the year 1978, the property was transferred to the respondents, who claimed its possession from 1967, on his application dated 3.4.1974. He also managed to deposit the rent of the property from January 1968, onwards. The Naib-Tehsildar (Sales) -cum-Managing Officer, Amritsar, who originated the proposal for transfer of the property in favour of the respondent, has been quite negligent in making adequate enquiries regarding this case, when there was already a transfer file relating to this property pending with the Managing Officer (Hqrs). It appears to be a case of undue favour made to the respondent. The learned Settlement Commissioner also does not appear to have applied his mind to the full facts of this case. With these remarks, this revision petition is accepted. The lower Courts orders dated 9.1.1979 of the Settlement Commissioner 7.7.1979 of the Settlement Officer (Urban) and 14.9.1978 of the Tehsildar (Sales)-cum-Managing Officer, Amritsar, regarding issue of conveyance deed in favour of the respondent, are set-aside. It is further ordered that the property be transferred to Chaman Lal petitioner and the other legal heirs of the deceased, Smt. Durga Devi, if any. The balance price, if any, be also recovered. The amount deposited by the respondent towards the price of the property should be refunded to him."

The matter did not rest here. On a petition filed by the present petitioner u/s 33 of the Act, the Financial Commissioner Revenue, and Secretary to Government, Punjab, Rehabilitation Department had found that the cause of all this litigation was the failure of the department to inform the respondent (Smt. Durga Devi) what balance amount had to pay. Therefore, he had dismissed the petition.

The present case is fully covered by the ratio laid down in Inder Singh''s case (supra). Herein the property was transferred in favour of Smt. Durga Devi under Rule 25 of the Rules and if she failed to pay any instalment due on the property, it should have been recovered from her u/s 21 of the Act. There is no provision in the Act or the Rules authorising the authorities under the Act to cancel the transfer of the property and to resume the same. Section 21 expressly states that any sum payable to the Government in respect of any property in the compensation pool may be recovered in the same manner as arrears of land revenue.

As mentioned above, the Authorised Settlement Commissioner had directed the Managing Officer (T) to intimate Smt. Durga Devi of the amount due but neither she nor her legal representative was so informed and, therefore, learned Chief Settlement Commissioner had rightly allowed the revision petition filed by the legal representative of Smt. Durga Devi, the present respondent. The Financial Commissioner Revenue vide his order Annexure P-3 had found in unambiguous terms that the present litigation was due to the failure of the department to inform Smt. Durga Devi the balance amount to be paid by her. He had rightly dismissed the petition u/s 33 of the Act filed by the petitioner.

In view of the above discussion, this writ petition has no merit and is dismissed. However, in the peculiar circumstances of the case, the parties are left to bear their own costs.