S. Balwant Singh and Others vs Union of India (UOI) and Others

D.K. Mahajan, J.—This is a petition under Article 226 of the Constitution by one Balwant Singh Chaudhri impugning the order dated the 29th November, 1960, of Shri Parashotam Sarup, Deputy Chief Settlement Commissioner, New Dehi, re-jecting his petition for revision. The orders, which culminated in the revisional order, and the order u/s 33 of the Displaced Persons (Compensation and Rehabilitation) Act, 1954, are also sought to be quashed. The basis of these orders is one, namely, that the property, which the Petitioner claims to be an allotable property is not an allotable property it being a shop and only a part of a building. The building consists of ten shops, a factory on a part of the first floor and a residential flat on the second floor. The building is situate in that part of Chandni Chowk which is known as Gandhi Cloth Market. The Petitioner is an allottee of one out of these ten shops and is a displaced person holding a verified claim. The Department came to the conclusion that the building was not an allotable property and, therefore, decided to auction the same.

The Petitioner''s case, on the oilier hand, is that the Department could not consider the building as one unit and had to approach the matter from the point of view of what; was in Petitioner''s possession. In other words, Petitioner being an occupant of a shop and the same being an allotable property under Rule 22(1)(b) of the Displaced Persons (Compensation and Rehabilitation) Rides, 1955 (hereinafter called the rules), he was entitled to its allotment under Rule 25 irrespective of the fact that it only formed part of a larger building. The case of the Department is that the shop is not an independent unit and is a part of the building. Moreover, it cannot be conveniently separated from it. It is the building alone which is the unit and its value being more than Rs. 10,000/- it is not an allotable property. According to the Petitioner the shop in his possession is of the value of less than Rs. 10,000/- though the indication on the evidence is that even that contention is not correct, but no finding has been given by the authorities who considered the matter on this part of the case. Therefore the question that requires determination is whether the Petitioner is entitled to the allotment of the shop which is in his occupation or is the Department right in its contention that the shop cannot be allotted to the Petitioner because it is not an independent unit and must necessarily be treated as a part of a larger unit the value of which is more than Rs. 10,000/-.

Before determining this question it will be proper to set down the relevant provisions of the Act and the Rules made thereunder Section 8 deals with the form and manner of payment of compensation and transfer of property by sale or allotment is one of the modes of payment of compensation. Rule 22, which is in these terms, defines the classes of entire evacuee property which may be allotted:

The following classes of acquired evacuee property shall ordinarily be allotted namely:

(a) any residential property in the occupation of a displaced person, the value of which does not exceed ten thousand rupees;

(b) any shop in the occupation of a displaced person, the value of which does not exceed ten thousand rupees;

(c) any industrial concern in the occupation of a displaced person, the value of which does not exceed fifty thousand rupees.

(2) A portion of a building of an acquired evacuee property which has no independent access shall not, unless Central Government otherwise directs be allotable.

Rule 23 contemplates that all acquired evacuee properties which are not allotable under Rule 22 shall ordinarily be sold. Rule 24 provides the mode of the value of the allotable property to be fixed and is in these terms:

(1) Where any acquired evacuee property which is an allotable property is to be transferred to any person in occupation thereof in satisfaction of the whole or a part of the compensation, payable to such person, the Regional Settlement Commissioner shall first determine the value of the property having regard inter alia to all or any of the following matters:

(a) the amount for which property was Assessed for the purpose of municipal taxes during the year in which the date of acquisition falls;

(b) the annual rental income of the property;

(c) sales of similar or contiguous properties during the last three years;

(d) the present market value of the site and the present value of the evacuee building and in the case of an industrial concern the value of the machinery.

(2) For the purpose of determination of the value of any acquired evacuee property under Sub-rule (1) depreciation may be allowed according to the age of the building, the quality of construction and the standard of maintenance of the property.

Rule 25 provides for the transfer of acquired evacuee property, which is allotable, to a displaced person holding a verified claim and is as follows:

(1) Where an Applicant for payment of compensation is in sole occupation of an acquired evacuee property which is an allotable property, such property may be transferred to him in lieu of the compensation payable to him under the Act.

Provided that the total amount of net compensation payable to the Applicant is not less than half in the case of property other than an industrial concern and less than 1/4th in the case of an industrial concern (for such other smaller proportion as the Chief Settlement Commissioner may in other case determine) of the value of the property as determined under Rule 24.

Provided further that no industrial concern shall be transferred to the Applicant unless he pays up the arrears if any, of the lease money outstanding against him in respect of such concern.

(2) Where the value of the property exceeds the net amount of compensation payable to the Applicant, the Applicant shall be required to pay the balance--

(a) in one lump sum; or

(b) in installments as the following:

(i) in the case of property other than industrial concern-

(a) Where the value of the property does not exceed in the case of a shop in a rural area or in a town other than those mentioned in appendix X two thousand rupees and in the case of any other five thousand rupees in four equal annual instalments;

(b) Where the value of the property exceeds the limits specified in Clause (a) or where the property consists of a shop situated in a town specified in appendix X in two equal annual instalments.

(ii) in case of an industrial concern in instalments spread over a period not exceeding two and a half years, or

(c) by adjustments against compensation payable in respect of the verified claim of any other person.

Provided that in case of an acquired evacuee property including an industrial concern which is an allotable property the Applicant may at his option, pay the balance together with interest in seven equated instalments.

(3) Where the amount of net compensation payable to the Applicant exceeds the value of the property the property may be transferred to the Applicant and he may be paid the balance of the compensation in cash or in the form of property in accordance with the provisions of these rules.

(4) Where the value of the property is equal to the amount of net compensation, the property may be transferred to the Applicant and in such a case the claim for compensation shall be deemed to have been fully satisfied.

Rule 26 provides for a similar transfer to a displaced person who does not hold a verified claim. Rule 30 provides for the payment of compensation where an acquired allotable evacuee property is in occupation of more persons than one. It is necessary to reproduce this rule which is in these terms:

If more persons than one holding verified claims are in occupation of any acquired evacuee property which is an allotable property the property shall be offered to the person whose net compensation is nearest to the value of the property and the other persons may be allotted such other acquired evacuee property which is allotable as may be available:

Provided that where any such, property can suitably be partitioned, the Settlement Commissioner shall partition the property and allot to each such person a portion of the property so partitioned having regard to the amount of net compensation payable to him.

Explanation I. - The provisions of the. rule shall also apply where some of the persons in occupation of any acquired evacuee property which is an allotable property hold verified claims and some do not hold such claims.

Explanation II. - If any acquired evacuee property has been allotted to a member of a family as defined in Sub-rule (3) of Rule 7 who does pot hold any verified claim and if another member of the family holding a verified claim is in occupation of such property, the compensation payable to such other member of the family may be adjusted against the value of the property.

Some of these rules were later amended. The amended rules have no application as they are not retrospective. On this both the parties are agreed.

The contention of Mr. Narula, learned Counsel for the Petitioner, is that the premises in occupation of his client being a shop they are allotable by reason of Rule 22(1)(b) as their value is less than Rs. 10,000/.-. It does not matter that the shop is only a small part of a larger unit the building having not only shops but also residential and industrial premises. Therefore, he contends that under Rule 25 the Department is bound to transfer the same to his client. The operative part of Rule 25 is:

(1) Where an Applicant for payment of compensation is in sole occupation of an acquired evacuee property which is an allotable property, such property may be transferred to him in lieu of the compensation payable to him under the Act:

The word "may" in this rule has been interpreted as "shall" by Shamsher Bahadur, J., in Shri Ramji Dass v. Ministry of Rehabilitation, Government of India Civil Writ No. 40 of 1960, D/- 10-11-1960 (Punj) and by Meher Singh, J., in S. Karam Singh v. The Chief Settlement Commissioner, Ministry of Rehabilitation, Civil Writ No. 685 of 1960, D/- 25-4-1961 (Punj) and their ''decisions are noticed by the Division Bench in Sodhi Harbaksh Singh v. The Central Government, 1962-64 Pun LR 629. The Division Bench was interpreting Rule 26 where again the same word "may" is used in the operative part but "may" was interpreted by the Division Bench as "may" and not as "shall" as in the case of Rule 25. Therefore, Mr. Narula contends that no option was left to the Department in the matter by reason of the clear provisions of Rule 22 and Rule 26. The question that the shop is not an independent unit is wholly an extraneous matter, as otherwise in Rule 22 shop would not have been mentioned separately. Therefore, the fact'' that the shop is a part of a larger building and is not divisible is not a material consideration in refusing to transfer this shop to the Petitioner.

On the other hand it is contended by Mr. Gurbachan Singh and Mr. Jindra Lal, respective counsel for the auction purchaser and the State, that Rule 22 merely classifies all allotable properly under three heads - (1) residential property, (2) shop and (3) industrial concern. While classifying the property into these categories Sub-rule (1) provides that the property so classified shall ordinarily be allotable. In other words, the rule merely provides that if a property falls in any one of these categories it should be allotted, but it does not necessarily mean that in every case it must be allotted because the word "shall" is followed by the word "ordinarily" and meaning must be given to the word "ordinarily". This rule came up for interpretation before Mr. Justice Tek Chand in Girdhari Lal Bulaki Ram and Another Vs. L.J. Johnson and Others, and the learned Judge at page 186 (of ILR Punj) : (at P. 466 of AIR) has observed as under:

Rule 22 is worded in a language which gives considerable amount of discretion and is mandatory. The word ''ordinarily'' in Sub-rule (1) and ''unless Central Government otherwise directs'' in Sub-rule (2) admit of considerable flexibility.

Once this interpretation is held to be correct the necessary result would be that in a proper case the department has the discretion to take out a property falling in any one of these categories and may refuse to allot it. It may be that this discretion cannot be arbitrarily exercised. Possibly reasons may have to be given for taking out a property from the category of the allotable properties. In the present case even if the argument urged by Mr. Narula is accepted at its face value ample reasons have been given by the Department for taking out the present property from the category Of allotable properties. These reasons are that the shop is a part of a bigger building and being one unit cannot be divided and if it is divided it will lead to a lot of complications and disputes.

It is not disputed that if the shop is treated as a part of the bigger building not an independent unit the value of the building is more than Rs. 10,000/- and as such it is not an allotable property. Mr. Narula contends that in order to determine the value of the property the rest of the building should not be taken into account and only the shop in the possession of the Petitioner should be taken into consideration. There seems to be no justification for this either in Rule 22 or in Rule 25. Rule 25 will only come into play if under Rule 22 the property is allotable and once the Government exercises its discretion under Rule 22 and takes out the property from the category of allotable properties then Rule 25 will not be of any assistance.

There is another way of looking at the matter. Rule 22 classifies acquired evacuee property as residential, shop and industrial concern. It obviously does so on the basis that they are independent units as such and not that all of them are so intermixed that strictly speaking the unit cannot be said to be strictly either a residential property or a shop or an industrial concern. That is why it was necessary to enact Rule 30. This rule provides that if an acquired evacuee property, which is an allotable property, is in occupation of more than one person holding a verified claim then it shall be offered to the person whoso net compensation is nearest to the value of the property and the other persons may be allotted such other, acquired evacuee property which is allotable and is otherwise available unless it can be suitably partitioned. In that case it shall be so partitioned. It is conceded by the learned Counsel for the Petitioner that the question whether a certain property can or cannot be partitioned is a matter resting entirely within the discretion of the authorities and their decision on the question will not be questionable under Article 226 of the Constitution. All that he contends is that Rule 30 will have no application because here the acquired evacuee property which is allotable is the shop and not the building. But this argument begs the question. The shop when it is only a part of the building and not an independent unit cannot by itself be taken into consideration for the purpose of finding out whether it is an acquired evacuee property which is allotable.

Only two other matters remain to be (sic) Both these matters were argued by the State counsel Mr. Jindra Lal and one of the contentions raised by him was that a displaced person has no right to get a particular property. His right u/s 8 of the Act is merely to get compensation. The mode and the manner as to the payment of compensation is governed by the Rules and the Rules give considerable discretion to the authorities in the matter. The learned Counsel relies on a decision of the Supreme Court in The State of Orissa Vs. Madan Gopal Rungta, , to the effect that the Petitioner who moves the High Court under Article 226 of the Constitution must possess a right which he is seeking to enforce. As the Petitioner has no right to get a particular property allotted to himself he cannot move this Court under Article 226 of the Constitution of India. In view of my decision on the main question it is not necessary to probe further into this matter.

The other contention advanced is that there is no, error on the face of the record which can be corrected by recourse to proceedings under Article 226 of the Constitution. The question whether the shop is by itself an allotable property is a question which on the peculiar facts of this case is at best capable of two opinions. Therefore the rule laid down by the Supreme Court in Satyanarayan Laxminarayan Hegde and Others Vs. Millikarjun Bhavanappa Tirumale, will apply.

Their Lordships in Satyanarayan Laxminarayan Hegde and Others Vs. Millikarjun Bhavanappa Tirumale, held as follows:

An error which has to be established by a long drawn process of reasoning on points where there may conceivably be two opinions can hardly he said to be an error apparent on the face of the record. Where an alleged error is far from self-evident and if it can be established, it has to be established, by lengthy and complicated arguments, such an error cannot be cured by a writ of certiorari according to the rule governing the powers of the superior Court to issue such a writ.

This argument of the learned Counsel certainly has force. In order to point out the error in the impugned order Mr. Narula had to labour hard for almost a day and had to address elaborate arguments. Such an error if it be an error cannot in the words of their Lordships of the Supreme Court be said to be an error apparent on the face of the record so as to justify interference under Article 226 of the Constitution.

For the reasons given above this petition fails and is dismissed. There will, however, be no order as to costs.