Gujarat High Court
Ganesh Industrial Estate vs Addl Dy Collector & Competant ... on 20 April, 2021
Bench: Vineet Kothari, Biren Vaishnav
C/LPA/263/2013 CAV JUDGMENT DT. 20.04.21
GANESH INDUSTRIAL ESTATE v. ADDL DY COLLECTOR & COMPETANT OFFICER
[ULC - Agreement Holder - Not entitled to separate Notice]
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/LETTERS PATENT APPEAL NO. 263 of 2013
In
R/SPECIAL CIVIL APPLICATION NO. 4642 of 1992
FOR APPROVAL AND SIGNATURE:
HONOURABLE DR. JUSTICE VINEET KOTHARI
and
HONOURABLE MR. JUSTICE BIREN VAISHNAV
============================================================
1 Whether Reporters of Local Papers may be allowed to Yes
see the judgment ?
2 To be referred to the Reporter or not ? Yes
3 Whether their Lordships wish to see the fair copy of the Yes
judgment ?
4 Whether this case involves a substantial question of law Yes
as to the interpretation of the Constitution of India or
any order made thereunder ?
============================================================
1. GANESH INDUSTRIAL ESTATE (PROPRIETOR VASHRAMBHAI
PUNJABHAI PATEL) THROUGH LRs PROPRIETOR (LAXMI SAW
MILLS)
1.1 MANSUKH VASHRAMBHAI PATEL
1.2 ARVINDBHAI VASHRAMBHAI PATEL
Versus
1. ADDL DY COLLECTOR & COMPETANT OFFICER
2. STATE OF GUJARAT
============================================================
Appearance:
MR PERCY KAVINA, Senior Counsel with MR D.K. PUJ for the Appellant
Nos.1,1.1,1.2
MR K.M. ANTANI, Assistant Government Pleader for the Respondent No.1,2
============================================================
C/LPA/263/2013 CAV JUDGMENT DT. 20.04.21
GANESH INDUSTRIAL ESTATE v. ADDL DY COLLECTOR & COMPETANT OFFICER
[ULC - Agreement Holder - Not entitled to separate Notice]
CORAM: HONOURABLE DR. JUSTICE VINEET KOTHARI
and
HONOURABLE MR. JUSTICE BIREN VAISHNAV
Date : 20/04/2021
CAV JUDGMENT
(PER : HONOURABLE DR. JUSTICE VINEET KOTHARI)
1. This Letters Patent Appeal is directed against the order
dated 15.1.2013 of the learned Single Judge (Coram: Jayant Patel,
J.) partly allowing the writ petition, being Special Civil
Application No.4642 of 1992 - Ganesh Industrial Estate & 2
Others vs. Additional Deputy Collector & Competent Officer &
Another, remanding the case back to the ULC Tribunal under
Section 33 of the Urban Land (Ceiling and Regulation) Act, 1976
(ULC Act, 1976) for deciding the following issues with the
following observations:
"12. Apart from the above, the other relevant aspects
to be considered by the Tribunal were as under:
(1) Whether any agreement to sell was ever entered
into since the possession was stated to have been
handed over by the original owner in favour of
Shree Ganesh Industrial Estate. If the agreement
to sell never existed, the question of claiming
any right may not arise but such aspect could be
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[ULC - Agreement Holder - Not entitled to separate Notice]
gone into only if the so called original agreement
to sell is produced and its authenticity is proved
by the process known to law by a person who is
claiming the right pursuant to the so called
agreement to sell.
(2) The so called Shree Ganesh Industrial Estate as
such was not legal entity in the eye of law and
unless such agreement was entered into by the
original owner with any living person or any
legal entity. As such agreement to sell was neither
produced before the appellate authority nor
before this Court, no view can be expressed at
this stage but if the agreement is not in favour of
any legal entity or living personality, it may have
adverse effect on the so called claim.
(3) Further, the role or capacity of Vashrambhai
Punjabhai Patel was also required to be
considered and examined by the Tribunal as to
whether Vashrambhai Punjabhai Patel could
represent Ganesh Industrial Estate or not or
whether he could be said as aggrieved for
challenging the order of the first authority.
13. In my view, it was required for the Tribunal to
examine the aforesaid aspects in addition to the
above referred legal aspects of the so called claim, so
called construction over the property before finally
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[ULC - Agreement Holder - Not entitled to separate Notice]
concluding on the aspects of maintainability of the
appeal and/or for dismissal of the appeal.
14. As the present petition is essentially under article
227 of the Constitution, if the Tribunal has not
properly examined the matter on the aspects which
were germane to the exercise of the power by the
Tribunal, it would be just and proper to remand the
matter to the Tribunal. In my view, the dismissal of the
appeal on the mere ground that no interest could be
said to have been created under the Transfer of
Properties Act in the land or property in question was
not sufficient. Therefore, the order of dismissal of the
appeal on such one aspect even if maintained to the
extent that the original appellant had no interest in
law over the property, the matter deserves to be
remanded to the Tribunal for examination of the other
relevant aspects which were germane to the exercise of
appellate power by the Tribunal.
15. In view of the aforesaid observations and
discussions, the impugned order passed by the
Tribunal for dismissal of the appeal is set aside but
with the direction that the appeal No.11/92 shall
stand restored to the file of the Tribunal. It is further
directed that the Tribunal shall examine the matter in
light of the observations made hereinabove in the
present judgment and decide the appeal after giving
opportunity of hearing to the petitioner preferably
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[ULC - Agreement Holder - Not entitled to separate Notice]
within a period of six months from the receipt of the
order of this Court.
16. Petition is allowed to the aforesaid extent.
Considering the facts and circumstances, no order as to
costs."
2. Appellant No.1 - Ganesh Industrial Estate (Proprietor
Vashrambhai Punjabhai Patel) is now represented by his Legal
Representatives namely, (i) Mansukh Vashrambhai Patel; and
(ii) Arvindbhai Vashrambhai Patel, who also are said to have set
up an industrial unit known as Laxmi Saw Mill on the land in
question which is situated in Survey No.274/1 in Odhav,
admeasuring 6,050 sq.mtrs.
3. The facts as noted by the learned Single Judge in para 2 of
the order dated 15.1.2013 impugned before us are quoted below
for ready reference:
"2. The short facts are that Supreme Industries Ltd.,
(hereinafter referred to as "the original owner") was
holding the land at Odhav bearing Survey No.274/1
admeasuring 6050 sq. mtrs. with construction. As per
the petitioner, the agreement to sell was entered into
by the Company (original owner) with one Shree
Ganesh Industrial Estate on 17.01.1974. As per the
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[ULC - Agreement Holder - Not entitled to separate Notice]
petitioner, the possession of the land was handed
over. However, as the land was held by the original
owner and no sale deed was executed, form no.I was
filed by the original owner under section 6 of the
Urban Land (Ceiling and Regulation) Act, 1976
(hereinafter referred to as "the Act" for short). The said
form was filled by the Power of Attorney holder of Shri
Natwarlal Somchand Oza on behalf of the original
owner. In the said form while showing interest of any
other person, it was stated that the agreement to sell
has been entered into on 17.10.1974. In clause no.10
of the form no.1, it was stated that the possession has
also been handed over as per the agreement to sell to
Shree Ganesh Industrial Estate. In clause 11, it was
mentioned that the application for exemption has
been made. In clause no.13 it was also mentioned that
the application for exemption has been made under
section 21 of the Act and in clause no.14, while
showing the interest of any other party, it was
mentioned that Ganesh Industrial Estate, Odhav
Taluka City Ahmedabad is having interest. In the
supplementary to the said form, in clause no.14, the
interest of Ganesh Industries Ltd. was mentioned and
in the remarks column it was mentioned that the
agreement to sell is executed and total Rs.70000 has
been received by the Company. The aforesaid form
came to be filed on 05.04.1976. It appears that
thereafter, the person who had filed the form in
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[ULC - Agreement Holder - Not entitled to separate Notice]
capacity as the power of attorney of the original owner
was sent the notice. But it appears that he was
represented through his legal heirs Kanubhai
Natwarlal. Neither any objections were filed nor the
said legal heirs of the Power of Attorney remained
present and the matter proceeded exparte and
ultimately, vide order dated 22.08.1990, the order was
passed by the competent authority under the Act for
declaring the land admeasuring 4037 sq. metre
bearing survey no.274/1 as surplus land. Thereafter,
the notice under section 10(5) of the Act is stated to
have been issued on 25.09.1991 and such notice was
also addressed to the legal heirs of Natwarlal
Somchand Oza."
4. Since with the repeal with ULC Act, 1976 with effect from
30.3.1999, no Tribunal under the said Act existed and was not
functioning, therefore, in pursuance of the directions issued by
this Court on 8.1.2021, the Assistant Government Pleader
submitted that there is no such Tribunal which now exists to deal
with the remanded case in pursuance of the order of the learned
Single Judge. Therefore, the present Letters Patent Appeal
deserves to be decided on its own merits by this Court.
5. Mr. K.M. Antani, learned Assistant Government Pleader
submitted that the controversy in hand is squarely covered by the
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[ULC - Agreement Holder - Not entitled to separate Notice]
recent decisions of this Court and he also additionally relied upon
the judgment of Andhra Pradesh High Court in the case of
Vijayawada Urban Zilla Weaker Section and Economically
Backward Classes Society represented by its President M.
Shankar Rao vs. Dhulipalla Kishore Kumar and Others [AIR
1996 AP 80].
6. On the other hand, Mr. Percy Kavina, learned Senior
Counsel assisted by Mr. D.K. Puj, learned counsel for the
Appellants, urged before us that the learned ULC Tribunal had
wholly erred in dismissing the Appeal No.Ahmedabad 11 of 1992
- Vashrambhai Punjabhai Patel vs. Competent Authority, vide its
order dated 27.4.1992, only on the ground that the Appellant was
only an Agreement Holder (Banakhat) dated 17.10.1974.
Therefore, the Appellant had no interest in land on 17.2.1976 and
he could not participate in the proceedings under the ULC Act,
1976 and thus, the appeal was liable to be dismissed as the
possession of the land in question had been taken over by the
State on 28.12.1991 after serving Notice under Section 10(5) of
the ULC Act, 1976 on the original declarant - Supreme Industries
Limited represented by its power of attorney holder Natwarlal
Somchand Oza who was, later on, represented by his legal heir
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[ULC - Agreement Holder - Not entitled to separate Notice]
Kanubhai Natwarlal Oza. It may be stated here that even the
said Agreement to Sell, which is said to have been executed by the
original land holder Supreme Industries Limited in favour of
Vashrambhai Punjabhai Patel, Proprietor Laxmi Saw Mill or
Ganesh Industrial Estate, was never produced on record either
before this Court or before the ULC Tribunal.
7. Mr. Percy Kavina, Senior Counsel, however, submitted that
it was undisputed that the present Appellants - Legal
Representatives of Vashrambhai Punjabhai Patel in the name and
style of Ganesh Industrial Estate (or Laxmi Saw Mill) were in
possession of the land in question under the said Agreement to
Sell and therefore, Rule 5(2) of the Urban Land (Ceiling and
Regulation) Rules clearly required a separate and independent
notice to be issued by the Competent Authority in favour of the
present Appellant - Vashrambhai Punjabhai Patel also and since
no such notice was admittedly served to them the entire
proceedings under the ULC Act, 1976 were void and non est and
the position upon remand by the learned Single Judge to the
Tribunal who was to decide the issues as framed by the learned
Single Judge, but which could not be decided, as no such
Tribunal existed after the repeal of the law on 30.3.1999,
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[ULC - Agreement Holder - Not entitled to separate Notice]
therefore, the position of land as it existed on 30.3.1999 should
be restored, namely, land to remain in possession of the
Appellants.
8. Mr. Percy Kavina, learned Senior Counsel relied upon the
Division Bench Judgment of this Court in the case of Niranjan
Maganlal Mehta vs. Competent Authority & Additional
Collector (Letters Patent Appeal No.1164 of 2006 in Special Civil
Application No.6560 of 1990) decided on 18.3.2009 by the
Division Bench (Coram: Hon'ble Mr. Mohit S. Shah and Hon'ble
Ms. H.N. Devani). He urged that the learned Single Judge has
given findings in favour of the Petitioner that he was in
possession of the land in question and was also entitled to the
Notice under Section 10(5) of the ULC Act, 1976 read with Rule
5(2), but since certain issues required further determination in
the opinion of learned Single Judge including the question
whether any Agreement to Sell was ever entered into with the
Appellants or not, which issue Mr. Percy Kavina, learned Senior
Counsel submitted, was not at all in dispute and could not have
been asked to be examined by the Tribunal as directed by the
learned Single Judge. Therefore, except the remand direction, the
findings of the learned Single Judge in favour of the Appellant as
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[ULC - Agreement Holder - Not entitled to separate Notice]
given in paras 6 to 8 of the impugned order deserve to be
maintained. Paras 6 to 8 of the order of the learned Single Judge
are also quoted below for ready reference:
"6. As such, if the record is considered as it is,
following position emerges -
(1) In form no.1, the declaration has been made by
the original owner for the alleged agreement to
sell in favour of Ganesh Industrial Estate and
the transfer of the possession of the land under
the agreement to sell by the original owner in
favour of Ganesh Industrial Estate. It also shows
the construction in part over the land in
question.
(2) Power of Attorney on behalf of the original owner
had filed form under the Act.
(3) The original owner is not served with the draft
statement, but legal heirs of Natwarlal
Somchand Oza who was power of attorney
appears to have been served the notice.
(4) The petitioner who is claiming to be in
possession is also not served with the notice
under section 10(5) of the Act.
(5) As per the documents produced by the petitioner
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GANESH INDUSTRIAL ESTATE v. ADDL DY COLLECTOR & COMPETANT OFFICER
[ULC - Agreement Holder - Not entitled to separate Notice]
with the affidavitinrejoinder dated 18.10.2010,
the Corporation at the relevant point of time in
the year 1988 appears to have assessed the
property in the name of Vashrambhai
Punjabhai Patel (sole proprietor of Laxmi Saw
Mills) vide bill No.327 dated 26.12.1988 of
Rs.51,673/. Therefore, in the year 1988, there
appears to be the construction and Vashram
Punjabhai Patel in capacity as proprietor of
Laxmi Saw Mill was shown as person in
possession as per the AMC record. The petitioner
has also produced in the said affidavitin
rejoinder, subsequent bills for the years 1989,
1991, 1992, 1993, 1996, 1997 and 2000.
7. The aforesaid shows that Vashrambhai
Punjabhai was in possession of a portion of the
constructed property bearing part of the same survey
number at the time when the order came to be passed
under the Act on 22.08.1990 as well as when the notice
under section 10(5) of the Act was issued on 25.09.1991.
8. It further appears from the affidavitinreply
filed on behalf of the State Government that the
panchnama was prepared for taking possession of the
land pursuant to the notice under section 10(5) of the
Act on 28.12.1991 and at para 2 there is reference to the
unauthorised construction but it has been stated that
the possession was taken over ex parte without any
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[ULC - Agreement Holder - Not entitled to separate Notice]
encumbrance."
9. We have heard learned counsel at length and given our
thoughtful consideration to the rival submissions.
10. We cannot agree with the submissions made by Mr. Percy
Kavina on behalf of the Appellants / Petitioners and in our
opinion, the present Appeal deserves to be dismissed for the
following reasons.
11. Firstly, we also cannot sustain the order of the learned
Single Judge to the extent of remand made to the Tribunal. We
set aside the order of the learned Single Judge to that extent and
we have looked into the merits of the rival submissions in the
present Letters Patent Appeal upon a detailed hearing given to
the learned counsel and we are deciding this case on merits.
12. We also cannot sustain the findings and reasons of learned
Single Judge on merits also. We also cannot agree with the
learned counsel for the Appellants that on the basis of the
Agreement to Sell of 1974, which was never placed on record
before any Authority or Court, the possession of the land in
question should be allowed to be retained by the Appellants /
Petitioners treating all the proceedings taken and which became
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[ULC - Agreement Holder - Not entitled to separate Notice]
final under the ULC Act, 1976 against the original land holder
M/s. Supreme Industries Limited, who was represented by its
power of attorney holder, as non est.
13. The position of Agreement Holders without any Decree or
Registered Conveyance or Sale Deed in their favour and their
right to participate in the proceedings under ULC Act, 1976 has
been recently dealt with by us in the case of Prabhatbhai
Shivabhai Solanki through LRs vs. State of Gujarat and 4 Others
(Letters Patent Appeal No.1281 of 2016) decided on 23.3.2021
and another judgment delivered by us on 25.3.2021, two days
after the previous one in the case of Ravhjibhai Chhotabhai
Patel vs. Competent Officer and Others (Letters Patent Appeal
No.941 of 2016).
14. In both these matters, we have discussed in detail the legal
position of conclusion of proceedings under the ULC Act, 1976 by
serving the Notice under Section 10(5) of the ULC Act, 1976 on
original land holders and Agreement Holders not being entitled
to any such separate notice, following the Supreme Court
Judgments in the case of State of Assam vs. Bhaskar Jyoti Sarma
[(2015) 5 SCC 321] and in the case of Suraj Lamp & Industries
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[ULC - Agreement Holder - Not entitled to separate Notice]
Pvt. Ltd. [(2012) 1 SCC 656] and the Full Bench Judgment of
Gujarat High Court in the case of Shah Jitendra Nanalal vs.
Patel Lallubhai Ishverbhai Patel [1984 (2) GLR 1001], we have
held that the adjudicatory process under the ULC Act, 1976
comes to an end, once the Notification under Section 10(3) of the
ULC Act, 1976 vesting the land in the State Government free from
all encumbrances is issued and published.
15. It would be worthwhile to quote the relevant part of these
two judgments, albeit a bit lengthy, to throw light and answer the
questions raised in the present case before us also:
From Gujarat High Court Division Bench Decision
dated 23.3.2021
Prabhatbhai Shivabhai Solanki through LRs vs.
State of Gujarat and 4 Others (Letters Patent Appeal
No.1281 of 2016):
"11. In our opinion, the learned Single Judge was
perfectly justified in holding that once the Notification
under Section 10(3) has been issued in the present case
on 3.8.1989 vesting the land in the State free from all
encumbrances and in pursuance thereof, upon
issuance of Notice under Section 10(5) of the ULC Act,
1976, the possession also has been taken over by the
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[ULC - Agreement Holder - Not entitled to separate Notice]
State Government on 1.4.1992 under Section 10(6) of
the ULC Act, 1976 through Panchnama Process, there
was no question of deciding the pending Application
under Section 21 of the ULC Act, 1976 upon remand
by the Tribunal and that too should be deemed to have
stood abated. The learned Single Judge has further
noted in the extract of judgment quoted above that
Notification under Section 10(3) of the ULC Act, 1976
and the proceedings of taking over the possession
under Section 10(5) / 10(6) of the ULC Act, 1976 have
not been assailed by the Petitioners at all and he is
merely banking upon the pendency of the Application
under Section 21 of the ULC Act, 1976 and have sought
the benefit of Section 4 of the Repeal Act treating the
proceedings concluded under Section 10(3)
Notification as well as under Section 10(5) and Section
10(6) of the ULC Act, 1976 as null and void or non est.
12. We find considerable force in the submission
made by learned Assistant Government Pleader that
once the land is vested in the State free from any
encumbrance, the question of granting exemption
under Section 20 and Section 21 of the ULC Act, 1976
cannot arise and even if such proceedings as on
30.3.1999 are pending on the basis of application
originally filed or upon remand by the higher
authority, the same loses its significance and they are
fait accompli and vesting the land in the State under
Section 10(3) of the ULC Act, 1976 cannot be upset or
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disregarded by the Competent Authority. Such
pending applications will abate and will have to be
treated as rejected, as no question of granting
exemption can arise thereafter.
13. We find this proposition of law concluded by the
Full Bench Judgment of Gujarat High Court in the case
of Shah Jitendra Nanalal vs. Patel Lallubhai
Ishverbhai Patel [1984 (2) GLR 1001], in which the
Full Bench of this Court dealing with the case upon
reference by the Division Bench on a question whether
a decree for specific performance can be granted by the
Court where the proceedings under ULC Act, 1976 have
been undertaken by the State and can the Defendant
raise a plea in the Court that such decree for specific
performance cannot be granted in view of the action of
compulsory acquisition under provisions of the ULC
Act, 1976. The Full Bench of this Court answered the
question in the following manner:
"17. At the commencement of the Act, persons
may be "holding vacant land in excess of ceiling
limit", but as the 'vacant land' does not
automatically 'vest' in the State Government,
they hold it subject to certain obligations. There
are restrictions imposed concerning dealing with
such land. Until a notification issued under sec.
10(3), the land does not vest in the Government
and that is why we have referred to the situation
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as one of 'suspense' till that date. Once the land
'vests' in the State Government, there is no
question of invoking the 'exemption' clause
under sec. 20(1)(a) and (b); but until then, there
is a right to move the Government for exemption
and there is an 'obligation' on the Government to
'exempt' the land in case the conditions which
warrant the exemption sought are satisfied. In
case such conditions are shown to be satisfied, it
is not as if the power of exemption could be
exercised at the sweet will and pleasure of the
State Government. The State Government has
necessarily to be guided by the policy indicated in
the provision itself and cannot traverse that
policy. Consequently, the Government cannot
also refuse to exempt if the case falls within those
subsections. Therefore, until 'vesting' is under
sec. 10(3) of the Act, there is always a possibility
of 'defeasance of such vesting' on a motion for
such exemption. If so, in a case where the person
holding excess land is under a contractual
obligation to convey property under an
agreement to another, could he defeat that
obligation by contending that transfer by him
would be void and at the same time seeking
exemption and obtaining benefit of such
exemption in respect of such land?
18. So long as the provision declaring the
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[ULC - Agreement Holder - Not entitled to separate Notice]
transfer under sec. 5(3) as void is subject to the
right to move for exemption, obtain exemption
and transfer the property, the power of an owner
of vacant land in excess of the ceiling limit to
'alienate' such land is dormant in him and such
power could be exercised by him in case he seeks
exemption, satisfies the Government that the
grounds for exemption exist, and obtains such
exemption. That being the case, a decree cannot
be defeated on the ground that 'transfer' inter
partes would not be possible. The possibility of
obtaining exemption survives till the
notification under sec. 10(3) of the Act is issued.
That being the situation, until then, a plaintiff
seeking specific performance cannot be told that
the terms of the contract cannot be fulfilled. Once
it is said so, the plaintiff loses his right to get a
decree for specific performance, though, invoking
the provisions of the very Act, based on which the
plaintiff was told that he could not get
conveyance of the property agreed to be sold to
him, the owner of excess land obtains exemption
and continues in possession of property and
perhaps even alienates it later. We see no reason
either in law or in logic to countenance such a
situation. There is nothing prohibiting a decree
being passed for specific performance, with, of
course, such alternative remedies as may be
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[ULC - Agreement Holder - Not entitled to separate Notice]
called for in a situation where that decree may
become inoperative. The decree for specific
performance may be made conditional on the
exemption under sec. 20(1)(a) or (b) operating.
Of course, it is not for us in this reference to
envisage how safeguards should be built in such
a decree. Resourcefulness, of course, must
necessarily find answer to possible situations."
14. The aforesaid judgment, in our view, concludes
the issue about fate of exemption applications under
Sections 20 and 21 of the ULC Act, 1976 also while the
Full Bench answered the question of discretion of the
Court to grant decree of specific performance subject to
the fate of application under Sections 20 and 21 of the
ULC Act, 1976. In para 17, the significant words are
'therefore, until 'vesting' is under sec. 10(3) of the Act,
there is always a possibility of 'defeasance of such
vesting' on a motion for such exemption'. In para 18,
the same view was reiterated by the Full Bench in the
following manner viz. 'the possibility of obtaining
exemption survives till the notification under sec.
10(3) of the Act is issued'. These two ratio decidendi
portion of the Full Bench, in our opinion, clinches the
issue and it can be safely held that no pending
application under Section 20 or 21 will have any
meaning and should be deemed to have been rejected
with the issuance of Notification under Section 10(3) of
the ULC Act, 1976 vesting the land in question free
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[ULC - Agreement Holder - Not entitled to separate Notice]
from all encumbrances. It is a significant event
happening under the ULC Act, 1976 viz. vesting of the
land in the State free from all encumbrances which
cannot be made dependent on the adjudicatory process
under Sections 8, 9 or even appeal under Section 33 or
application under Section 20 or 21 of the ULC Act,
1976.
15. The adjudicatory process comes to an end with
the issuance of Notification under Section 10(3) of
the ULC Act, 1976 and thereafter, the formal
conclusion of the proceedings under the ULC Act, 1976
can take place either under Section 10(5) or Section
10(6) of the ULC Act, 1976 by taking over the
possession, as we have explained in our recent
judgment in the case of Heirs of Dec. Jethabhai
Ishwarbhai vs. State of Gujarat & Ors. Letters
Patent Appeal No.405 of 2017 decided on 22.1.2021.
The relevant portion of that judgment is quoted below,
for ready reference:
"18. Subsection (5) of Section 10 after vesting of
the surplus land with the State Government
provides that the Competent Authority may, by
notice in writing, order any person who may be
in possession of it, to surrender or give the
possession thereof to the State Government or
any person duly authorised by the State
Government within 30 days of service of notice.
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[ULC - Agreement Holder - Not entitled to separate Notice]
The plain language of subsection (5) of Section
10 means and envisages a notice in writing in
the form of an order to surrender or make over
the possession to the State. Subsection (5)
notice is not in the form of a show cause notice
but in the form of an order apparently because
the process of hearing the objections to such
declaration of surplus land is already taken care
in subsections (1) and (2) of Section 10. Once
the land is vested, after dealing with such
objections, in the State Government, the only
activity remaining to be done is to complete the
process and achieve the object of this Act, was
to take over the physical possession of such
declared excess land. Therefore, a notice in the
form of an order was prescribed in subsection
(5) to deliver the possession within 30 days of
service of the notice.
19. There is no question of any voluntary
handing over of possession on the part of the
land owner. Whatever is done under subsection
(5) is done in pursuance of the noticecumorder
of the Competent Authority under Section 10(5)
of the Act.
20. The argument based on the premise of
voluntary handing over of the possession within
30 days of the said noticecumorder under
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[ULC - Agreement Holder - Not entitled to separate Notice]
Section 10(5) of the Act is, therefore, a
misnomer. If the possession is handed over in
compliance with the noticecumorder under
Section 10(5) of the Act to the State authorities or
person nominated by the State, the proceedings
under the ULC Act get concluded under Section
10(5) of the Act. If that is not done by the land
owner in pursuance of noticecumorder under
Section 10(5) of the Act, whatever thereafter is
done to take over the physical possession of the
excess land in question, that can only fall
under Section 10(6) of the Act, which says that if
any person refuses or fails to comply the order
made under subsection (5), then the Competent
Authority may take possession of vacant land
and may use such force as may be necessary for
that purpose. Subsection (6) does not require
any other notice or order once again to be passed
by the Competent Authority. It only envisages act
of taking over the physical possession in the
manner known to law including Panchnama
process and presence of the owner of the land is
not a condition precedent for such taking over of
the possession. The last part of subsection (6) is
only enabling and empowering provision for the
Competent Authority who may use the force for
taking over the physical possession, if there is any
obstruction or hindrance created by anybody
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[ULC - Agreement Holder - Not entitled to separate Notice]
including the land owner in that process.
Otherwise use of force is not necessary. Sub
section (6), therefore, is not of an adjudicatory
nature, but it only provides for a physical
process to take de facto possession with or
without the use of force. Then the proceedings
under ULC Act get concluded under Section 10(6)
of the Act. Both these subsections are not
necessary to be operated and invoked in each
and every case. The proceedings under ULC Act
can get concluded either under Section 10(5) or
10(6) of the Act as indicated above.
21. Therefore, in our opinion, the arguments
raised before us that subsection (5) envisages
voluntary handing over of possession and sub
section (6) talks of forcible taking over
possession, both are incomplete and misleading
arguments. The scheme of this two subsections
as explained above does not put these two
provisions in silos or watertight compartments.
They, on the other hand, provide for a smooth
and barrierless process of taking over of the
possession under the 1976 Act.
22. In these circumstances, if the possession is
not handed over within 30 days of service of
notice under Section 10(5), it will amount to
failure to comply with the order under sub
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[ULC - Agreement Holder - Not entitled to separate Notice]
section (5) and thereafter whenever the
possession is taken by the State authorities,
even though after 6 years, as it has happened in
the present case through Panchnama process
in the absence of physical presence of the land
owner, it does not vitiate those proceedings
which will fall under Section 10(6) of the Act.
The taking over of the possession through
Panchnama process in the presence of two
witnesses is a well recognised process for taking
over the possession in law and cannot be said to
be void, non est or illegal in any manner. The
land owner cannot claim that since such
possession was taken over after a belated period
after expiry of 30 days as prescribed in Section
10(5) of the Act, he was entitled to again a notice
in this regard requiring his presence on the spot
giving him option either to voluntarily surrender
such possession or obstruct the same. No such
notice or opportunity is intended to be given
under Section 10(6) of the Act. Therefore, in the
present facts before us, the possession taken over
by the State authority on 24.11.1993 was
justified and legally undertaken through
Panchnama process and in our opinion, no valid
exception to the same can be taken by the
Appellant.
23. As far as reliance placed on the case of Hari
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[ULC - Agreement Holder - Not entitled to separate Notice]
Ram (supra) is concerned, we are of the clear
opinion that the learned Single Judge was right
in distinguishing the said judgment as it is not a
case before us where no notice under Section
10(5) of the Act was issued to the land owner. On
the contrary, it is admitted position that such
notice was given to the land owner on 4.6.1988.
The later judgment of the Hon'ble Supreme
Court fully explained the purport of the
decision in the case of Hari Ram (supra) in the
case of Bhaskar Jyoti Sarma (supra) where even
Section 10(5) notice was not given and still
taking over the possession was held as valid, as
quoted in extenso by the learned Single Judge
and that in our respectful understanding,
clinches the issue in favour of the State.
... ... ... ... ... ... ... ... ..."
16. The Hon'ble Supreme Court has deprecated such
practices of Power of Attorney Holders, etc. fighting
such litigation in land matters in the judgment in the
case of Suraj Lamp & Industries Pvt. Ltd. [(2012) 1
SCC 656], the relevant part which is quoted below, for
ready reference:
"1. By an earlier order dated 15.5.2009
[reported in Suraj Lamp & Industries Pvt. Ltd. vs.
State of Haryana & Anr. 2009 (7) SCC 363], we
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[ULC - Agreement Holder - Not entitled to separate Notice]
had referred to the ill effects of what is known
as General Power of Attorney Sales (for short
`GPA Sales') or Sale Agreement / General Power
of Attorney / Will transfers (for short
`SA/GPA/WILL' transfers). Both the descriptions
are misnomers as there cannot be a sale by
execution of a power of attorney nor can there be
a transfer by execution of an agreement of sale
and a power of attorney and Will. As noticed in
the earlier order, these kinds of transactions were
evolved to avoid prohibitions/conditions
regarding certain transfers, to avoid payment of
stamp duty and registration charges on deeds of
conveyance, to avoid payment of capital gains
on transfers, to invest unaccounted money
(`black money') and to avoid payment of
`unearned increases' due to Development
Authorities on transfer.
2. The modus operandi in such SA/GPA/WILL
transactions is for the vendor or person claiming
to be the owner to receive the agreed
consideration, deliver possession of the property
to the purchaser and execute the following
documents or variations thereof:
(a) An Agreement of sale by the vendor in
favour of the purchaser confirming the terms of
sale, delivery of possession and payment of full
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[ULC - Agreement Holder - Not entitled to separate Notice]
consideration and undertaking to execute any
document as and when required in future.
Or
An agreement of sale agreeing to sell the
property, with a separate affidavit confirming
receipt of full price and delivery of possession
and undertaking to execute sale deed whenever
required.
(b) An Irrevocable General Power of Attorney
by the vendor in favour of the purchaser or his
nominee authorizing him to manage, deal with
and dispose of the property without reference to
the vendor.
Or
A General Power of Attorney by the vendor in
favour of the purchaser or his nominee
authorizing the attorney holder to sell or transfer
the property and a Special Power of Attorney to
manage the property.
(c) A Will bequeathing the property to the
purchaser (as a safeguard against the
consequences of death of the vendor before
transfer is effected).
These transactions are not to be confused or
equated with genuine transactions where the
owner of a property grants a power of Attorney in
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[ULC - Agreement Holder - Not entitled to separate Notice]
favour of a family member or friend to manage
or sell his property, as he is not able to manage
the property or execute the sale, personally.
These are transactions, where a purchaser pays
the full price, but instead of getting a deed of
conveyance gets a SA/GPA/WILL as a mode of
transfer, either at the instance of the vendor or at
his own instance.
Ill effects of SA/GPA/WILL transactions:
3. The earlier order dated 15.5.2009, noted the
illeffects of such SA/GPA/WILL transactions
(that is generation of black money, growth of
land mafia and criminalization of civil
disputes) as under:
"Recourse to `SA/GPA/WILL' transactions is taken
in regard to freehold properties,even when there
is no bar or prohibition regarding transfer or
conveyance of such
property, by the following categories of persons:
(a) Vendors with imperfect title who cannot
or do not want to execute registered deeds of
conveyance.
(b) Purchasers who want to invest
undisclosed wealth/income in immovable
properties without any public record of the
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[ULC - Agreement Holder - Not entitled to separate Notice]
transactions. The process enables them to hold
any number of properties without disclosing
them as assets held.
(c) Purchasers who want to avoid the
payment of stamp duty and registration
charges either deliberately or on wrong advice.
Persons who deal in real estate resort to these
methods to avoid multiple stamp
duties/registration fees so as to increase their
profit.
Whatever be the intention, the consequences are
disturbing and far reaching, adversely
affecting the economy, civil society and law
and order. Firstly, it enables large scale evasion
of income tax, wealth tax, stamp duty and
registration fees thereby denying the benefit of
such revenue to the government and the public.
Secondly, such transactions enable persons with
undisclosed wealth/income to invest their black
money and also earn profit/income, thereby
encouraging circulation of black money and
corruption. This kind of transactions have
disastrous collateral effects also. For example,
when the market value increases, many vendors
(who effected power of attorney sales without
registration) are tempted to resell the property
taking advantage of the fact that there is no
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[ULC - Agreement Holder - Not entitled to separate Notice]
registered instrument or record in any public
office thereby cheating the purchaser. When the
purchaser under such `power of attorney sales'
comes to know about the vendors action, he
invariably tries to take the help of musclemen to
`sort out' the issue and protect his rights. On the
other hand, real estate mafia many a time
purchase properties which are already subject to
power of attorney sale and then threaten the
previous `Power of Attorney Sale' purchasers
from asserting their rights. Either way, such
power of attorney sales indirectly lead to growth
of real estate mafia and criminalization of real
estate transactions."
It also makes title, verification and
certification of title, which is an integral part of
orderly conduct of transactions relating to
immovable property, difficult, if not impossible,
giving nightmares to bonafide purchasers
wanting to own a property with an assurance of
good and marketable title.
4. This Court had, therefore, requested the
learned Solicitor General to give suggestions on
behalf of Union of India. This Court also directed
notice to States of Delhi, Haryana, Punjab, Uttar
Pradesh to give their views on the matter. The
four states have responded and confirmed that
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[ULC - Agreement Holder - Not entitled to separate Notice]
SA/GPA/WILL transfers required to be
discouraged as they lead to loss of revenue
(stamp duty) and increase in litigations due to
defective title. They also referred to some
measures taken in that behalf. The measures
differ from State to State.
In general, the measures are:
(i) to amend Registration Act, 1908 by
Amendment Act 48 of 2001 with effect from
24.9.2001 requiring documents containing
contract to transfer for consideration
(agreements of sale etc.) relating to any
immoveable property for the purpose of section
53A of the Act, shall be registered; and
(ii) to amend the stamp laws subjecting
agreements of sale with delivery of possession
and/or irrevocable powers of attorney in favour
of nonfamily members authorizing sale, to the
same stamp duty as deed of conveyance. These
measures, no doubt, to some extent plugged the
loss of revenue by way of stamp duty on account
of parties having recourse to SA/GPA/WILL
transactions, instead of executing deeds of
conveyance. But the other illeffects continued.
Further such transaction which was only
prevalent in Delhi and the surrounding areas
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[ULC - Agreement Holder - Not entitled to separate Notice]
have started spreading to other States also. Those
with ulterior motives either to indulge in black
money transactions or land mafia continue to
favour such transactions. There are also efforts to
thwart the amended provisions by not referring
to delivery of possession in the agreement of
sale and giving a separate possession receipt or
an affidavit confirming delivery of possession
and thereby avoiding the registration and
stamp duty. The amendments to stamp and
registration laws do not address the larger issue
of generation of black money and operation of
land mafia. The four States and the Union of
India are however unanimous that SA/GPA/WILL
transactions should be curbed and expressed
their willingness to take remedial steps."
17. The Hon'ble Supreme Court then proceeded to
give detailed reasoning for laying down the law in this
regard in the following epochmaking words:
"16. Section 54 of TP Act makes it clear that a
contract of sale, that is, an agreement of sale does
not, of itself, create any interest in or charge on
such property. This Court in Narandas
Karsondas v. S.A.Kamtam and Anr., (1977) 3
SCC 247, observed:
......... ......... .........
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[ULC - Agreement Holder - Not entitled to separate Notice]
17. In Rambhau Namdeo Gajre v. Narayan
Bapuji Dhotra [2004 (8) SCC 614] this Court
held:
"Protection provided under Section 53A
of the Act to the proposed transferee is a
shield only against the transferor. It
disentitles the transferor from disturbing
the possession of the proposed transferee
who is put in possession in pursuance to
such an agreement. It has nothing to do
with the ownership of the proposed
transferor who remains full owner of the
property till it is legally conveyed by
executing a registered sale deed in favour of
the transferee. Such a right to protect
possession against the proposed vendor
cannot be pressed in service against a
third party." [This clinches the issue
involved before us]."
18. It is thus clear that a transfer of immoveable
property by way of sale can only be by a deed of
conveyance (sale deed). In the absence of a deed of
conveyance (duly stamped and registered as required
by law), no right, title or interest in an immoveable
property can be transferred. It is thus clear that a
transfer of immoveable property by way of sale can
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[ULC - Agreement Holder - Not entitled to separate Notice]
only be by a deed of conveyance (sale deed). In the
absence of a deed of conveyance (duly stamped and
registered as required by law), no right, title or
interest in an immoveable property can be
transferred.
19. Any contract of sale (agreement to sell) which is
not a registered deed of conveyance (deed of sale)
would fall short of the requirements of sections 54
and 55 of TP Act and will not confer any title nor
transfer any interest in an immovable property (except
to the limited right granted under section 53A of TP
Act). According to TP Act, an agreement of sale,
whether with possession or without possession, is not a
conveyance. Section 54 of TP Act enacts that sale of
immoveable property can be made only by a registered
instrument and an agreement of sale does not create
any interest or charge on its subject matter.
......... ......... .........
Conclusion
23. Therefore, a SA/GPA/WILL transaction does not
convey any title nor create any interest in an
immovable property. The observations by the Delhi
High Court, in Asha M. Jain v. Canara Bank - 94
(2001) DLT 841, that the "concept of power of attorney
sales have been recognized as a mode of transaction"
C/LPA/263/2013 CAV JUDGMENT DT. 20.04.21
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[ULC - Agreement Holder - Not entitled to separate Notice]
when dealing with transactions by way of
SA/GPA/WILL are unwarranted and not justified,
unintendedly misleading the general public into
thinking that SA/GPA/WILL transactions are some kind
of a recognized or accepted mode of transfer and that it
can be a valid substitute for a sale deed. Such decisions
to the extent they recognize or accept SA/GPA/WILL
transactions as concluded transfers, as contrasted from
an agreement to transfer, are not good law.
24. We therefore reiterate that immovable property
can be legally and lawfully transferred/conveyed only
by a registered deed of conveyance. Transactions of the
nature of `GPA sales' or `SA/GPA/WILL transfers' do
not convey title and do not amount to transfer, nor
can they be recognized or valid mode of transfer of
immoveable property. The courts will not treat such
transactions as completed or concluded transfers or
as conveyances as they neither convey title nor create
any interest in an immovable property. They cannot
be recognized as deeds of title, except to the limited
extent of section 53A of the TP Act. Such transactions
cannot be relied upon or made the basis for
mutations in Municipal or Revenue Records. What is
stated above will apply not only to deeds of conveyance
in regard to freehold property but also to transfer of
leasehold property. A lease can be validly transferred
only under a registered Assignment of Lease. It is
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[ULC - Agreement Holder - Not entitled to separate Notice]
time that an end is put to the pernicious practice of
SA/GPA/WILL transactions known as GPA sales."
From Gujarat High Court Division Bench Decision
dated 25.3.2021
Ravhjibhai Chhotabhai Patel vs. Competent Officer
and Others (Letters Patent Appeal No.941 of 2016):
"25. We are not at all satisfied with the entry of the
Power of Attorney Holder at a belated stage for the
same being for any bona fide reasons. Such strangers
without proper right or interest in the property cannot
be permitted to continue with the vexatious litigation
in this manner. The Notarised (not registered) Power
of Attorney in her favour dated 24.10.2009 bearing
Registration No.1187 dated 12.3.2010 in the office of
Mr.A.L. Vohara, Notary, only shows that he is neither
related to the executants nor he has any interest in the
property but he was a 'man of confidence' for them.
The Hon'ble Supreme Court deprecated such practices
in the judgment in the case of Suraj Lamp &
Industries Pvt. Ltd. (supra), the relevant part which is
quoted below for ready reference:
......... ......... .........
26. That as far as the proceeding under provisions of
the ULC Act, 1976 is concerned, in the present case, we
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[ULC - Agreement Holder - Not entitled to separate Notice]
are satisfied that the same stood concluded and closed
way back in the year 1985 itself and therefore, there
was no occasion to claim that the possession continued
to be with the land holders viz. these four brothers and
mere revenue entry continuing in the name of Javerbai
does not upset the declaration of vesting of land in the
State under Section 10(3) of the ULC Act, 1976 nor the
factum of possession taken over by the Competent
Authorities under Section 10(5) / 10(6) of the ULC Act,
1976. The alleged minor irregularity of nonserving of
the Notices under Section 10(5) of the ULC Act, 1976 on
all the four brothers though admittedly some of such
notices were served on all four of them or that the
possession was taken in the absence of these brothers at
the site on the date of taking over the possession, is of
no consequence and the law in this regard has been
settled by the Hon'ble Supreme Court in the case of
Bhaskar Jyoti Sarma (supra) which has been
followed by this Court in the case of Heirs of Dec.
Jethabhai Ishwarbhai (supra) distinguishing the
earlier decision of the Hon'ble Supreme Court in the
case of Hari Ram (supra). The relevant extract of the
judgment in the case of Heirs of Dec. Jethabhai
Ishwarbhai (supra) is quoted below for ready
reference:
"18. Subsection (5) of Section 10 after vesting of
the surplus land with the State Government
provides that the Competent Authority may, by
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[ULC - Agreement Holder - Not entitled to separate Notice]
notice in writing, order any person who may be
in possession of it, to surrender or give the
possession thereof to the State Government or
any person duly authorised by the State
Government within 30 days of service of notice.
The plain language of subsection (5) of Section
10 means and envisages a notice in writing in
the form of an order to surrender or make over
the possession to the State. Subsection (5)
notice is not in the form of a show cause notice
but in the form of an order apparently because
the process of hearing the objections to such
declaration of surplus land is already taken care
in subsections (1) and (2) of Section 10. Once
the land is vested, after dealing with such
objections, in the State Government, the only
activity remaining to be done is to complete the
process and achieve the object of this Act, was
to take over the physical possession of such
declared excess land. Therefore, a notice in the
form of an order was prescribed in subsection
(5) to deliver the possession within 30 days of
service of the notice.
19. There is no question of any voluntary
handing over of possession on the part of the
land owner. Whatever is done under subsection
(5) is done in pursuance of the noticecumorder
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[ULC - Agreement Holder - Not entitled to separate Notice]
of the Competent Authority under Section 10(5)
of the Act.
20. The argument based on the premise of
voluntary handing over of the possession within
30 days of the said noticecumorder under
Section 10(5) of the Act is, therefore, a
misnomer. If the possession is handed over in
compliance with the noticecumorder under
Section 10(5) of the Act to the State authorities or
person nominated by the State, the proceedings
under the ULC Act get concluded under Section
10(5) of the Act. If that is not done by the land
owner in pursuance of noticecumorder under
Section 10(5) of the Act, whatever thereafter is
done to take over the physical possession of the
excess land in question, that can only fall
under Section 10(6) of the Act, which says that if
any person refuses or fails to comply the order
made under subsection (5), then the Competent
Authority may take possession of vacant land
and may use such force as may be necessary for
that purpose. Subsection (6) does not require
any other notice or order once again to be passed
by the Competent Authority. It only envisages act
of taking over the physical possession in the
manner known to law including Panchnama
process and presence of the owner of the land is
not a condition precedent for such taking over of
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[ULC - Agreement Holder - Not entitled to separate Notice]
the possession. The last part of subsection (6) is
only enabling and empowering provision for the
Competent Authority who may use the force for
taking over the physical possession, if there is any
obstruction or hindrance created by anybody
including the land owner in that process.
Otherwise use of force is not necessary. Sub
section (6), therefore, is not of an adjudicatory
nature, but it only provides for a physical
process to take de facto possession with or
without the use of force. Then the proceedings
under ULC Act get concluded under Section 10(6)
of the Act. Both these subsections are not
necessary to be operated and invoked in each
and every case. The proceedings under ULC Act
can get concluded either under Section 10(5) or
10(6) of the Act as indicated above.
21. Therefore, in our opinion, the arguments
raised before us that subsection (5) envisages
voluntary handing over of possession and sub
section (6) talks of forcible taking over
possession, both are incomplete and misleading
arguments. The scheme of this two subsections
as explained above does not put these two
provisions in silos or watertight compartments.
They, on the other hand, provide for a smooth
and barrierless process of taking over of the
possession under the 1976 Act.
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[ULC - Agreement Holder - Not entitled to separate Notice]
22. In these circumstances, if the possession is
not handed over within 30 days of service of
notice under Section 10(5), it will amount to
failure to comply with the order under sub
section (5) and thereafter whenever the
possession is taken by the State authorities,
even though after 6 years, as it has happened in
the present case through Panchnama process
in the absence of physical presence of the land
owner, it does not vitiate those proceedings
which will fall under Section 10(6) of the Act.
The taking over of the possession through
Panchnama process in the presence of two
witnesses is a well recognised process for taking
over the possession in law and cannot be said to
be void, non est or illegal in any manner. The
land owner cannot claim that since such
possession was taken over after a belated period
after expiry of 30 days as prescribed in Section
10(5) of the Act, he was entitled to again a notice
in this regard requiring his presence on the spot
giving him option either to voluntarily surrender
such possession or obstruct the same. No such
notice or opportunity is intended to be given
under Section 10(6) of the Act. Therefore, in the
present facts before us, the possession taken over
by the State authority on 24.11.1993 was
justified and legally undertaken through
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[ULC - Agreement Holder - Not entitled to separate Notice]
Panchnama process and in our opinion, no valid
exception to the same can be taken by the
Appellant.
23. As far as reliance placed on the case of Hari
Ram (supra) is concerned, we are of the clear
opinion that the learned Single Judge was right
in distinguishing the said judgment as it is not a
case before us where no notice under Section
10(5) of the Act was issued to the land owner. On
the contrary, it is admitted position that such
notice was given to the land owner on 4.6.1988.
The later judgment of the Hon'ble Supreme
Court fully explained the purport of the
decision in the case of Hari Ram (supra) in the
case of Bhaskar Jyoti Sarma (supra) where even
Section 10(5) notice was not given and still
taking over the possession was held as valid, as
quoted in extenso by the learned Single Judge
and that in our respectful understanding,
clinches the issue in favour of the State.
24. As far as the question of exemption under
Section 21 as sought by the Appellant land owner
is concerned, we are of the opinion that it was
the just an excuse or ruse to save the land in the
hands of the land owners themselves as neither
any concrete scheme for development of dwelling
units for weaker sections was ever placed by the
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[ULC - Agreement Holder - Not entitled to separate Notice]
land owner before the Competent Authority or
before this Court, nor the said application
appears to have been pursued by the Appellant in
an appropriate manner. Mere filing of the
application could not have led the authorities to
grant exemption to such excess or surplus land
under Section 21 of the Act and save the said
land from the rigour and scheme of the 1976 Act
of taking over of excess land in the larger public
interest and therefore, the learned Single Judge
was right in rejecting the said contention as
well."
16. Let us now briefly discuss the judgments relied upon by
both learned counsel additionally besides the aforesaid settled
legal position.
17. The Division Bench of the Andhra Pradesh High Court in
the case of Vijayawada Urban Zilla Weaker Section and
Economically Backward Classes Society (supra) with which view,
we respectfully agree, held that the notice contemplated under
Rule 5(2) of the ULC Rules has to be given to the person whose
interests are in conflict with the interest of the declarant. In para
7 of the said judgment, the Court noted the facts as under:
"7. Questioning the said orders, the declarant filed
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[ULC - Agreement Holder - Not entitled to separate Notice]
Writ Petition No. 5699 of 1991 on 18.4.1991 on the file
of this Court and this Court passed interim orders
staying the notification except with regard to 1255 sq.
metres covered by agreement, in W.P.M.P. No. 7102/91
dated 19.4.1991. Nearly after a decade, Durga Society
filed Writ Petition No. 11806/91 questioning the
action of the competent authority in passing orders
on the objections filed by the declarant on 781982
under Section 8(4) of the Central Act without giving
notice to it as required under Rule 5(2) of the Urban
Land Rules, 1976, hereinafter referred to as 'the Rules'
as the Society is interested in the land by virtue of its
possession under an agreement of sale and sought for
a declaration that the subsequent orders passed by the
authorities under the Act are illegal. In the said Writ
Petition, the Society filed W.P.M.P. No. 15032/91 and
this Court granted interim suspension of the
notification on 13.9.1991."
18. Then, the Court proceeded to answer the said question in
the following terms:
"25. Hence, a harmonious construction has to be given
to R. 5(2) of the Rules by interpreting the same that the
notice contemplated under this Rule is intended to a
person whose interests are in conflict with the
interests of the declarant. More so, in the light of S.
4(4)(a) of the Central Act, which says that any transfer
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[ULC - Agreement Holder - Not entitled to separate Notice]
between 1721975 and the appointed day have to be
ignored for computing the excess vacant land held by
the declarant. Section 4(4)(a) of the Central Act is
extracted hereunder.
"Section 4(4)(a): In any State to which this
Act applies in the first instance, if, on or
after the 17th day of February, 1975, but
before the appointed day, any person has
made any transfer by way of sale,
mortgage, gift, lease or otherwise (other
than a bona fide sale under a registered
deed for valuable consideration) of any
vacant land held by him and situated in
such State to any other person, whether or
not for consideration, then, for the
purposes of calculating the extent of vacant
land held by such person the land so
transferred shall be taken into account,
without prejudice to the rights or interests
of the transferee in the land so transferred:
Provided that the excess vacant land to be
surrendered by such person under this
Chapter shall be selected only out of the
vacant land held by him after such
transfer."
26. Under S. 5(1) of the Central Act, the excess vacant
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[ULC - Agreement Holder - Not entitled to separate Notice]
land to be surrendered by the declarant will be selected
out of the vacant land held by the transferee, if the
declarant is not having sufficient land to surrender.
Section 5(1) of the Central Act is as follows:
"5. Transfer of vacant land.-- (1) In any
State to which this Act applies in the first
instance, where any person who had held
vacant land in excess of the ceiling limit at
any time during the period commencing on
the appointed day and ending with the
commencement of this Act, has transferred
such land or part thereof by way of sale,
mortgage, gift, lease or otherwise, the
extent of the land so transferred shall also
be taken into account in calculating the
extent of vacant land held by such person
and the excess vacant land in relation to
such person shall, for the purpose of this
Chapter, be selected out of the vacant land
held by him after such transfer and in case
the entire excess vacant land cannot be so
selected, the balance, or, Where no vacant
land is held by him after the transfer, the
entire excess vacant land, shall be selected
out of the vacant land held by the
transferee:
Provided that where such person has
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[ULC - Agreement Holder - Not entitled to separate Notice]
transferred his vacant land to more than
one person, the balance, or, as the case may
be, the entire excess vacant land aforesaid,
shall be selected out of the vacant land held
by each of the transferees in the same
proportion as the area of the vacant land
transferred to him bears to the total area of
the land transferred to all the transferees".
27. As such, it has to be held that notice under R.
5(2) of the Rules is contemplated to such of the
alienees, whose interests are in conflict with the
declarant, but not to a person who is sailing with the
declarant and who has no adverse interest to that of
the declarant. If the Rule is not construed in that
manner, the Rule is directly in conflict with S. 8(3) of
the Central Act and the same is liable to be struck
down.
28. The issue may be examined from another angle.
The Rule says that notice has to be given to all the
persons who are having claim or interest in the
ownership etc. If the contention of the petitioner is to
be accepted, then the wife and minor children of the
declarant who are also included in the definition of the
family will also be entitled for a notice as they are also
having interest in the ownership and possession of the
vacant land. As a matter of fact, while computing the
vacant land not only the land held by the declarant but
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[ULC - Agreement Holder - Not entitled to separate Notice]
also of his/her spouse and the minor children from
whatever source they claim their rights of the
ownership, have to be computed. Hence, a notice is
also to be given to these persons who are included in
the definition of the family, and such a situation is
not contemplated either by the Central Act or the
Rules made thereunder."
19. Thus, it is clear that in absence of the Notice under Rule
5(2) of the ULC Rules to the Agreement Holder, like present
Appellants herein, even if the Notice was given only to the
original declarant or land holder, that would suffice and the
proceedings cannot be declared to be non est because to the
extent of defending the land in question from ULC proceedings,
where excess or surplus land is acquired by the State to subserve
the purpose of ULC Act, 1976 cannot be said to be in conflict with
the interest of the original land holder - Supreme Industries
Limited in the present case and the Agreement Holder has to sink
or sail with the original land holder, so long as he does not get a
Decree of Specific Performance and consequently, a Registered
Conveyance Deed or Sale Deed executed in his favour under such
Decree. Nothing of this sort has happened in the present case for
Appellant M/s. Ganesh Industrial Estate or Vashrambhai
Punjabhai Patel (Laxmi Saw Mills).
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[ULC - Agreement Holder - Not entitled to separate Notice]
20. On the other hand, the judgment relied upon by Mr. Percy
Kavina, learned Senior Counsel of a Coordinate Bench of this
Court in the case of Niranjan Maganlal Mehta (supra) is
distinguishable on facts. In the said case, the facts as noted by the
Division Bench of this Court as given in paras 3 and 4 of the
judgment, are quoted below for ready reference:
"3. The appellants herein are the heirs and legal
representatives of deceased Pannaben Niranjan
Mehta, who was the original petitioner in the writ
petition. The facts giving rise to the present appeal are
that the Shri Niranjan Mehta, husband of the
petitioner (hereinafter referred to as "the declarant")
had filed a statement under section 6 of the Urban
Land (Ceiling and Regulation) Act, 1976 (hereinafter
referred to as "the Act") in the prescribed Form No.1, on
behalf of his family specifying the extent of lands held
by his family members all of which are situated in
Ahmedabad as under:
Sr. Name of Survey Area Manner in which
No. village No. acquired
1 City Rajpur T.P. 739.12 sq. On lease for 99
Hirpur Scheme mts. years
No.4,
Final
Plot
No.73
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[ULC - Agreement Holder - Not entitled to separate Notice]
2 Thaltej 46 829.28 As member of
sq. mts. society
3 Khadia 2695 18.50 sq. Residential house.
mts. By succession
4 Khadia 2682 99 sq. Residential house.
mts. By succession
5 Paldi Samasth Subplot 635 sq. House. By
Brahmashatri No.88 mts. succession
ya Society Bunglow
No.89
As per the statement filed by the declarant the total
holding of the family was shown to be 2320.90 sq. mts.
It may be pertinent to note that it was specified in the
said form that land admeasuring 829.28 sq. mts of
Vanshri Coop. Housing Society situated at Thaltej is
the self acquired property of Pannaben
Niranjanbhai Mehta (hereinafter referred to as "the
petitioner") and is of her sole ownership wherein no
one has any right or share. Against the column "lands
held as owner" the area shown was 1568.40 sq. mts.
and against the column regarding "status of the lands
as to whether held as individual or HUF etc." land
admeasuring 1568.40 sq. mts was shown to be joint
family property and 829.28 sq.mts of land is shown
against the column "share of individual in
cooperative society". In the column for adhoc
assessment of excess vacant land and the lands which
are required to be handed over to the Government
lands of Rajpur Hirpur and Thaltej totally
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[ULC - Agreement Holder - Not entitled to separate Notice]
admeasuring 1319 sq. mts. were shown.
4. By an order dated 14.11.1984 passed under
section 8(4) of the Act, the Competent Authority found
that except for the property shown at serial No.2, all
the lands were H.U.F. properties; that the definition of
family includes husband, wife and their minor
children, hence the land held by the wife is required to
be clubbed together to determine the holding of the
family; that the record indicates that the Samast
Brahmakshatriya Cooperative Housing Society is the
occupier of the property shown at serial No.5, hence
the same cannot be taken into consideration for the
purpose of computing the holding; that though the
properties at serial No.3 and 4 are built up properties
the same are to be taken into consideration while
computing the extent of vacant land held by the
applicant. The Competent Authority found that the
total holding of the applicant was 1685 sq. mts. and
held that the applicant was entitled to retain 1000 sq.
mts. of land and declared 685 sq. mts. of land as excess
vacant which is to be acquired by the State
Government. The Competent Authority further held
that considering the contents of the transfer
agreements in respect of the properties other than the
property at serial No.2, the Thaltej property at serial
No.2 being the self acquired property of the wife of
the declarant, he was ordering that 685 sq. mts. out
of the same be handed over to the Government."
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[ULC - Agreement Holder - Not entitled to separate Notice]
21. On these facts, the Division Bench of this Court proceeded
to hold:
"15. In the facts of the present case, it is an admitted
position, which also finds support in the declaration
filed under Section 6 of the Act, that the land in
question situated in Van Shree Cooperative Housing
Society admeasuring 829.25 sq.mtrs. was of the
individual ownership of the petitioner Pannaben
Niranjan Mehta and was her selfacquired property.
Thus the petitioner was the holder of the land in
question within the meaning of the said term as
envisaged under the provisions of the Act. In the
circumstances, as prescribed under Rule 5 of the Rules
read with Section 8(3) of the Act, the petitioner being
the holder of the land in question was entitled to the
service of notice under subsection (3) of Section 8 of
the Act. It is an admitted position that no such notice
was served upon the petitioner. In the circumstances,
the proceedings under the Act to that extent would
stand vitiated as being violative of the statutory
provisions of Rule 5 of the Rules read with Section 8(3)
of the Act."
22. The aforesaid would clearly indicate that the facts of the
said case were entirely different and do not support of the case of
the present Appellants before us. The land in question, for which
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[ULC - Agreement Holder - Not entitled to separate Notice]
the wife Pannaben was held to be the sole owner, the Court held
that she was entitled to a separate Notice under Section 10(5) of
the ULC Act, 1976 and the husband by including the said land in
question in the declaration that would not disentitle the wife
from receiving a separate Notice under the ULC Act, 1976.
In the present case before us, the title of the property in
question does not stand conveyed under any Registered Sale
Deed or under a Decree of Specific Performance to the present
Appellants and therefore, there is no question of entitlement of
the present Appellants to the participation in the proceedings
under the ULC Act, 1976 and even though the Appellants may be
persons interested in the land, in absence of their rights in the
property not yet crystallised, the Appellants cannot be held
entitled to separate notice and consequential relief of setting
aside all the ULC proceedings at their instance, particularly when
they attained finality with the participation of the original land
owner.
23. A legal argument based on a weak factual foundation like
the one raised here, cannot obliterate, in our opinion, the
conclusion of the ULC proceedings with the participation of the
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[ULC - Agreement Holder - Not entitled to separate Notice]
land holder - Supreme Industries Limited who was represented
by its power of attorney holder before the Competent Authority
and the Tribunal. The Tribunal, therefore, was justified, in our
opinion, in rejecting the appeal filed by the present Appellants,
Vashrambhai Punjabhai Patel (representing Ganesh Industrial
Estate or Laxmi Saw Mills).
24. We have already indicated above that the remand of the
case by the learned Single Judge to the Tribunal was not called for
and the learned Single Judge not justified, when no such Tribunal
existed at that point of time also in 2013 at the time of passing of
the impugned order.
25. The legal position, as discussed above, therefore, does not
entitle the Appellants / Petitioners to any relief in the present
case and therefore, the present Appeal as well as the Writ Petition
deserve to be dismissed and the same are accordingly dismissed.
No order as to costs.
(DR. VINEET KOTHARI,J)
(BIREN VAISHNAV, J)
Bharat
