Karnataka High Court

M/S Neria Estates Rural Industries vs The State Of Karnataka on 5 July, 2024

Author: Krishna S Dixit

Bench: Krishna S Dixit

                         -1-
                                    W.A. No. 4312 of 2017


  IN THE HIGH COURT OF KARNATAKA AT BENGALURU
        DATED THIS THE 5TH DAY OF JULY, 2024                R
                      PRESENT
       THE HON'BLE MR JUSTICE KRISHNA S DIXIT
                         AND
  THE HON'BLE MR JUSTICE RAMACHANDRA D HUDDAR
             W.A. NO.4312 OF 2017 (LR)
BETWEEN:

1. M/S NERIA ETATES RURAL INDUSTRIES
   ASSOCIATION PVT. LTD.,
   NERIA VILLAGE BELTHANGADI TALUK,D.K.
   A COMPANY REGISTERED UNDER THE COMPANIES ACT,
   REPRESENTED BY ITS MANAGING DIRECTOR,
   MR.NERIA GOPALKRISHNA HEBBAR
   S/O N VENKATAKRISHNA HEBBAR,
   NOW AGED ABOUT 61 YEARS,
   AUM BEHIND MICROWAVE STATION
   PAIS HILL, BEJAI,
   MANGALORE - 575 004.

2. MR. NERIA GOPALKRISHNA HEBBAR,
   S/O N VENKATAKRISHNA HEBBAR,
   NOW AGED ABOUT 61 YEARS,
   AUM BEHIND MICROWAVE STATION
   PAIS HILL, BEJAI,
   MANGALORE - 575 004.
                                            ...APPELLANTS
(BY SRI.B V ACHARYA.,
    SRI.B J ACHARYA. AND
    SRI.M B NARGUND., SENIOR COUNSELS FOR
    SRI.K CHANDRANATH ARIGA., ADVOCATE)

AND:

1. THE STATE OF KARNATAKA,
   REPRESENTED BY ITS SECRETARY,
   DEPARTMENT OF REVENUE,
   M S BUILDING, DR. AMBEDKAR VEEDHI,
   BENGALURU - 560 001.
                                 -2-
                                              W.A. No. 4312 of 2017


2. THE DEPUTY COMMISSIONER,
   DAKSHINA KANNADA,
   MANGALORE - 575 001, D.K.
                                        ...RESPONDENTS
(BY SRI.C N MAHADESHWARA., AGA FOR R1 & R2)

     THIS WRIT APPEAL IS FILED UNDER SECTION 4 OF THE
KARNATAKA HIGH COURT ACT, PRAYING TO SET ASIDE THE
ORDER PASSED IN THE WRIT PETITION 1859/2008 DATED
29/5/17.

     THIS WRIT APPEAL HAVING BEEN HEARD AND RESERVED
FOR ORDER, THIS DAY, KRISHNA S. DIXIT.J., PRONOUNCED
THE FOLLOWING:

                           JUDGMENT

This intra-court appeal calls in question a learned

Single Judge's order dated 29.05.2017 whereby appellants

W.P.No.1859/2008 having been dismissed, their challenge

to Deputy Commissioner's order dated 17.01.2008

whereby possession of subject land was sought to be

taken, has been negatived. They had also sought for a

direction to restrain the respondents from interfering with

their possession & enjoyment of the subject land and for

the restoration of revenue entries in their favour. After

service of notice, official respondents have entered

appearance through the learned AGA.

II. Brief facts of the case:

(a) Subject 'plantation lands' were held in lease by

the appellant-company, since decades. Its application in

Form 7 filed u/s.48A of the Karnataka Land Reforms Act,

1961 was rejected by the jurisdictional Land Tribunal vide

order dated 25.05.1984 on the sole ground that the

applicant did not fit into the definition of 'tenant' u/s

2(34). Appellants' challenge to the said rejection in

W.P.No.14885/1984 failed vide order dated 8.4.1988.

Their W.A.No.1030/1988 c/w W.A.No.1867/1989 also met

the same fate at the hands of a Co-ordinate Bench on

21.09.1990. Their Review Petitions in C.P.Nos.13/1991 &

386/1991 too yield fruit vide order dated 03.01.1992.

Lastly, the challenge to all this in SLP (Civil) No.120/1991

was dismissed by the Apex Court as withdrawn by order

dated 26.07.1996.

(b) The Tahsildar by order dated 20.07.2000

mutated the Revenue Entries in favour of State in the light

of above fact matrix. Challenge to the same in

W.P.No.26764/2000 failed vide order dated 06.12.2005.

Appeal in W.A.No.124/2006 also met the same fate on

06.09.2006 at the hands of another Co-ordinate Bench,

liberty having been reserved to the respondents to initiate

proceedings for taking possession of lands expeditiously.

Accordingly the respondent-Deputy Commissioner vide

order dated 21.08.2007 directed taking of possession of

the lands. Appellants' challenge to the same in

W.P.No.14523/2007 having been partly favoured vide

order dated 18.09.2007, they were given opportunity to

file their objections by treating D.C's. order as only a

proposal. Writ Appeal No.2005/2007 against this order

failed on 12.11.2007 at the hands yet another Co-ordinate

Bench.

order dated 18.09.2007 filed their objections to the

Deputy Commissioner's 'proposal order' dated 21.08.2007

whereby possession was directed to be taken. The Deputy

Commissioner over ruled the objections and again directed

the Tahsildar vide order dated 17.01.2008 to take

possession of lands and deliver them to the Forest

Department. Challenge to the same having failed at the

hands of learned Single Judge, this appeal has landed at

our hands. We add that all these facts are a matter of

record and there is no dispute to the same.

III. SUBMISSION OF PARTIES:

(a) Learned Sr. Advocates appearing for the

appellants vehemently argued that the Land Tribunal vide

order dated 25.05.1984 had rejected appellant-company's

application in Form 7 on the sole ground that it did not

answer the definition of tenant; therefore the question

whether such a rejection was valid, alone was within the

scope of challenge in W.P.No.14885/1984, followed by

their Writ Appeal No.1030/1988 c/w land owner's

W.A.No.1867/1989 and in Review Petitions in C.P.Nos.

13/1991 c/w 386/1991; further challenge in SLP (Civil)

120/1991 was withdrawn; findings as to vesting of lands

in the State u/s.44 of the 1961 Act arguably entered in the

said proceedings do not operate as res judicata; therefore,

learned Single Judge grossly erred in denying relief to the

Appellants by wrongly applying the said doctrine; the

lands are not agricultural and were not tenanted as on

01.03.1974; the question of their vesting in the State

would not arise; in view of Act 53 of 2020, the prohibitions

enacted inter alia in Sec.79A & 79B of the 1961 Act has

been done away with, significantly with retrospective

effect. So arguing, they sought for the invalidation of

impugned order. They pressed into service certain rulings

in support of their case.

(b) Learned AGA representing the respondents, with

equal vehemence, contended that: this case has a

chequered history, a spate of cases having been

unsuccessfully launched by the appellants; all they were

dismissed by entering a 'specific finding' as to lands being

agricultural, tenanted as on 01.03.1974 and having vested

in the State by operation of law; appellants are wrong in

arguing that these findings do not suffer res judicata since

in any claim for occupancy in terms of Sec.48A of the

1961 Act, only three questions are involved viz., whether

land is agricultural, whether it is tenanted and whether it

was tenanted as on the cut off date; all these questions

having been considered & specifically answered by the Co-

ordinate Benches, appellants should not be permitted to

reagitate the same. So contending, he sought for dismissal

of the appeal with costs.

IV. Having heard the learned counsel for the parties

and having perused the appeal papers, we are inclined to

grant indulgence in the matter broadly agreeing with the

submissions made on behalf of the appellants for the

following reasons:

(A) A BRIEF DESCRIPTION OF THE KARNATAKA LAND REFORMS ACT, 1961:

(a) India is predominantly an agricultural country;

agriculture continues to be the backbone of national

economy even to this day. A 16th century a mendicant

philosopher Sarvajna of North Karnataka in his tercet

poetically says:

"PÉÆÃn «zÉåUÀ¼À°è ªÉÄÃn «zÉåAiÉÄ ªÉÄÃ®Ä ªÉÄÃn¬ÄA gÁn £ÀqÉzÀÄzÀ®èzÉ zÉÃ±À zÁlªÉÃ PÉqÀÄUÀÄ ¸ÀªÀðdÕ||"

Meaning: In a million skills, farming tops. It sustains the

run of other trades. Minus it, a nation flops. (Sarvajna

Vachanas - Epigrams of a Mendicant, Page 22 by Umaram

& K.S.Ram). Interest of agriculture cannot be overlooked

as the State which owes a constitutional obligation

towards it as reiterated by the Apex Court in M.C.MEHTA

vs. UOI, (2020) 7 SCC 530.

(b) The 1961 Act enacts a uniform policy of

agrarian reforms in the State. Primarily, the statute

enacts the principle 'tiller be the owner'. It came into

force on 2.10.1965. Extensive amendment vide Act 1 of

1974 w.e.f. 01.03.1974 ushered in a sea change. In

principle, it provides for the conferment of ownership of

land on tenants, ceiling on land holdings, surrender of

excess land to the State, establishment of machinery like

Land Tribunals, selective prohibition of land holding,

forfeiture of certain lands, exemption from restrictions,

exclusion of civil court jurisdiction, payment of

compensation to landlords, remittance of premium by

tenants, etc. In the recent past, Act 56 of 2020 has done

away with certain restrictions on land holding, with

retrospective effect from 1.3.1974; thus now there is no

restriction, and there 'was' no restriction earlier too,

because of retrospectivity of said amendment.

comprises of Sections 44 to 62. Essentially, it provides for

conferment of ownership on tenants. Section 44 inter alia

provides for vesting of tenanted lands in the State;

Section 45 provides for registration of occupancy in favour

of tenants; Section 47 prescribes payment of

compensation to landlords; Section 48 provides for

establishment of Land Tribunals at taluka levels for

adjudging occupancy claims; Section 48A provides for

enquiry by the Tribunal in matters of claims for occupancy.

Section 53 provides for payment of premium by tenants

after occupancy is granted. Section 55 provides for issue

of Certificate of Registration to the tenants who have

secured occupancy by the Tribunal. Section 60 provides

for forfeiture of lands for the failure of grantee of

occupancy to cultivate. Section 61 prescribes a 15 year

non-alienation period. Section 62 provides for surrender of

land by the tenant post registration of occupancy to the

State and for the disposal of surrendered lands.

- 10 -

(d) Section 44 which provides for statutory vesting of

lands in the State reads as under:

"44. Vesting of lands in the State Government.--

(1) All lands held by or in the possession of tenants (including tenants against whom a decree or order for eviction or a certificate for resumption is made or issued) immediately prior to the date of commencement of the Amendment Act, other than lands held by them under leases permitted under section 5, shall, with effect on and from the said date, stand transferred to and vest in the State Government".

[Sub-Section (2) not being relevant is not reproduced]

Learned advocates appearing for the appellants and the

learned AGA representing the State in their usual fairness

did not dispute the long standing position of law that for

vesting of land in terms of above provision, three things

are a must, namely: the land should have agricultural

character; it should be tenanted; such tenancy should

have subsisted as on 01.03.1974. This we call 'Triple

Test' for the purpose of convenience. Tribunal has to

apply this Test whilst processing the claim for occupancy

made in Form 7. Law providing for agrarian reforms needs

to be liberally construed so that its object is effectuated.

All this discussion is intended to put the things in right

- 11 -

perspective for the purpose of adjudication of the case at

hand.

(B) AS TO WHAT WAS DECIDED BY THE TRIBUNAL IN APPELLANTS' CLAIM FOR OCCUPANCY:

(a) At the outset, we make it clear that the

appellants have not disputed their failure in an avalanche

of litigations at the hands of Single Judges, Division

Benches of this court and at the level of Apex Court too.

Particulars of these cases are furnished above. There are

observations in certain judgements to the effect that the

subject lands have vested in the State by operation of law,

cannot be much disputed. The jugular vein of the case is

whether these observations made in the earlier rounds of

litigations do res judicate the appellants from taking up a

contra contention, afresh. Learned Sr. Advocates

appearing for the appellants argued that for invoking the

doctrine, invoker has to prima facie show that what has

been heard & decided in the earlier proceedings should be

what was essentially required for the adjudication of

subject cases; the question as to vesting of lands was

neither framed nor argued, the same being unessential,

- 12 -

whatever adverse observations on that point would not bar

the appellants from re-agitating the said question; they

hasten to add that Deputy Commissioner's order dated

21.08.2007. This is vociferously controverted by the

learned AGA. Therefore, we need to examine both legal &

factual matrices.

(b) The Land Tribunal declined occupancy to the

appellant-company vide order dated 25.05.1984. The

operative portion of the said order reads as under:

"J£ï gÁWÀÄªÀ ºÉ¨ÁâgÀgÀÄ CfðzÁgÀ£ÁV F CfðAiÀÄ°è ¥Àæw¤¢üPÀj¹gÀÄªÀ UÉÃt ªÀPÀÌ®Ä £ÉjAiÀÄ J¸ÉÖÃlÄ gÀÆgÀ¯ï EAqÀ¹ÖÃ¸ï J¸ÉÆÃ¹AiÉÄÃ±À£À ¥Éæ9ÊªÉÃmï ¸ÀA¸ÉÜAiÀiÁVgÀÄªÀÅzÀjAzÀ DzÀ£ÀÄß ¨sÀÆ ¸ÀÄzsÁgÀuÁ PÁ¬ÄzÉAiÀÄ ¸ÉPÀë£ï 2gÀ ¸À¨ï ¸ÉPÀë£ï 34gÀ ¥ÀæPÁgÀ UÉÃtÂ MPÀÌ¯ÁV ¥ÀjUÀtÂ¸À®Ä ¸ÁzsÀåªÁUÀVgÀÄªÀÅ¢®è. CfðzÁgÀ UÉÃtÂ ªÀPÀÌ®Ä MAzÀÄ PÀA¥É¤AiÀiÁVzÀÄÝ CzÀ£ÀÄß J£ï.gÁWÀÄªÀ ºÉ¨ÁâgÀgÀÄ ¥Àæw¤¢üÃPÀj¹gÀÄªÀÅzÁVzÉ. DzÀÝjAzÀ F CfðAiÀÄ£ÀÄß ¨sÀÆ £ÁåAiÀÄ ªÀÄAqÀAiÀÄÄ DzsÀåPÀëgÀÄ ºÁUÀÆ ¸ÀzÀ¸ÀågÀÄ MªÀÄävÀ¢AzÀ wgÀ¸ÀÌj¹ F DzÉÃ±À EwÛgÀÄvÁÛgÉ."

The above text shows that, rejection of Form 7 filed

u/s.48A of the 1961 Act was on the sole ground that the

company did not answer the definition of 'tenant' given

u/s.2(34). The said provision has the following text:

"tenant" means an agriculturist [who cultivates personally the land he holds on lease] from a landlord and includes,--

- 13 -

(i) a person who is deemed to be a tenant under section 4;

(ii) a person who was protected from eviction from any land by the [Karnataka] Tenants (Temporary Protection from Eviction) Act, 1961. (iia) a person who cultivates personally any land on lease under a lease created contrary to the provisions of section 5 and before the date of commencement of the Amendment Act.].

(iii) a person who is a permanent tenant; and

(iv) a person who is a protected tenant.

Explanation.--A person who takes up a contract to cut grass, or to gather the fruits or other produce of any land, shall not on that account only be deemed to be a tenant."

one of them being 'person who cultivates personally'. If we

mask the provisions of law quoted by the Tribunal in its

rejection order, it becomes crystal clear that what weighed

in rejection was not the definition of 'tenant' but the

prohibition enacted in Sec.79B(1)(b)(ii) of the Act to hold

agricultural land, inasmuch as the company could not hold

from 01.03.1974. A claimant not being entitled to hold

land because of prohibition is one thing and he being a

tenant u/s.2(34) is another. Answer to the former may be

in the negative though that to the later can be affirmative.

- 14 -

However this final distinction is not apparent from the text

of Tribunal's order. In any circumstance, the Tribunal did

not utter one single word about the lands being tenanted

or about their vesting in the State. It hardly needs to be

stated that it is only an agricultural land which was

tenanted as on 01.03.1974, alone would vest u/s.44(1).

(d) Since under the 1961 Act as it then stood, a

company incorporated under the provisions of erstwhile

Companies Act, 1956 like the first appellant herein was

not entitled to 'hold' any agricultural land inter alia

because of prohibition enacted in Sec.79B(1)(b)(ii) of the

1961 Act, it could not be a lawful tenant of an agricultural

land, regardless of the instrument of lease of 1958. To

postulate it in other words, an entity which is prohibited

from owning & possessing agricultural land cannot claim

occupancy, regardless of proven tenancy as on

01.03.1974. Mr.Acharya is right in submitting that the

claim for tenancy was not tried & adjudicated by the

Tribunal by employing Triple Test; none of the three mixed

questions of law & facts, which the Test conceives of, was

- 15 -

addressed. Though the Tribunal mentioned Section 2(34),

discussion in support of its invocation as such, is lacking in

its order. It was a case of rejection of Form 7 simpliciter,

nothing having been adjudicated on merits. The Tribunal

also did not say one word about the land being tenanted

as on 01.03.1974. Thus obviously the question of vesting

remained untouched. Had the claim been by a person

entitled to hold agricultural land, arguably the Tribunal

would have undertaken adjudication.

(a) The age old doctrine of res judicata having

kinship to estoppel by record is referred to in the works of

Indian sages, such as Shukra Neeti (4th century A.D). In

Sanskrit, it is called 'poorva nirnaya siddhaanta'. In a

conventional sense it means: a matter that has been

already concluded by adjudication cannot be re-litigated. It

obtained even in other jurisdictions, is also true. Two Latin

maxims provide the rationale for it: firstly, interest

reipublicae ut sit finis litium meaning that it is in the public

interest that there should be an end of litigation and

- 16 -

secondly, nemo debet bis vexari pro una et eadem causa

meaning that no one should be proceeded against twice

for the same cause.1 It is one of public policy that the best

interest of society demands that, litigation be concluded,

at least as a concession to shortness of human life. Added,

economy of the time of courts is one of the obviously

beneficial results of the doctrine and this feature becomes

immensely important as Courts/Tribunals nowadays are

extremely burdened. The doctrine has another aspect of

public policy: it promotes peace & quiet in the community

through the creation of certainty. Legal battles cannot be

kept alive in eternity. Opinio juris broadly supports that

the doctrine applies not only as between the parties but

qua the court, as well. Its invokability ordinarily is not

dependent upon correctness of the decision. Finality

marches over fallibility, in some institutions of the society.

(b) This doctrine has many shades & reflections and

its invokability is qualified, depending upon the text of

provision in the statute. Some jurisdictions have enacted

Halsbury's Laws of England, Fifth Edition, Volume 12, para 1168, LexisNexis

- 17 -

this doctrine in its widest amplitude whereas others have

not. Section 11 of Code of Civil Procedure, 1908, enacts

this doctrine in a bit restrictive way. The substantive

provision of this section has the following script:

"11. Res judicata.--No Court shall try any suit or issue in which the matter directly and substantially in issue has been directly and substantially in issue in a former suit between the same parties, or between parties under whom they or any of them claim, litigating under the same title, in a Court competent to try such subsequent suit or the suit in which such issue has been subsequently raised, and has been heard and finally decided by such Court."

There are as many as Eight Explanations that make the

substantive provision a little more expansive than it was

before, is also true. Even then Section 11 is not a

complete repository of the doctrine and therefore a bit of it

remains de hors. The net effect of this is: a suit or

proceeding to which this section applies cannot be resisted

by invoking the doctrine in excess of what has been

enacted in Sec.11 vide JANAKIRAMA IYER vs. P.M.

NILAKANTA IYER2. In other words, there may be cases

AIR 1962 SC 633

- 18 -

that would not strictly fall into Sec.11 although they may

fit into the broad doctrine of res judicata.

regulated by the provisions of CPC, because of Section 113

of the 1961 Act which reads as under:

"113. Application of the Code of Civil Procedure.--[(1)] Save as otherwise expressly provided in this Act, the provisions of the Code of Civil Procedure, 1908 (Central Act V of 1908) shall be applicable in respect of all applications and proceedings under this Act before the court."

The word 'Court' employed in the provision has been

interpreted to mean 'Tribunal' vide Coordinate Bench

decision in DAVALSAB vs. STATE OF KARNATAKA3. The

Bench also observed that in the absence of a specific

provision in variance, CPC would apply to the proceedings

before the Tribunal. There is nothing in the 1961 Act that

derogates from the invocation of section 11 of CPC in any

way. Therefore, the doctrine of res judicata as restrictively

enacted in this provision would apply to the proceedings

before the Tribunal, which is a body of exclusive

jurisdiction in matters of the kind.

(2008) 1 KCCR 439

- 19 -

(D) AS TO APPLICABILITY OF SECTION 11-RES JUDICATA VIS-A-VIS GENERAL DOCTRINE OF RES JUDICATA TO WRIT PROCEEDINGS:

(a) As already observed above, the conventional

doctrines like res judicata, estoppel, etc., would govern

inter alia writ proceedings subject to all just exceptions

vide P.BANDOPADHYA vs. UNION OF INDIA4

regardless of applicability of CPC and Evidence Act. The

conditions & qualifications that apply to the proceedings

before statutory Tribunals/Authorities would govern the

writ proceedings in which their orders are examined,

cannot be much disputed. This is a fortiori true because of

Rule 39 of the Writ Proceedings Rules, 1977 which is

coined as under:

"39. Application of the High Court of Karnataka Rules, etc.- The provisions of the High Court of Karnataka Rules, 1959, the rules made by the High Court of Karnataka under the Karnataka Court Fees and Suits Valuation Act, 1958, and the provisions of the Code of Civil Procedure, 1908, shall apply, as far as may be, to proceedings under [Article 226 and/or Article 227] and writ appeals in respect of matters for which no specific provision is made in these rules".

(2019) 13 SCC 42

- 20 -

(b) Another Coordinate Bench of this Court in

D.THIMMAPPA SHEIKA vs. STATE OF KARNATAKA5

having examined the above provision of the Rule, has

already held that CPC is applicable to writ proceedings.

What is noticeable is thus CPC applies to the writ

proceedings for two reasons: firstly because Sec.113 of

the 1961 Act makes it applicable to Tribunal proceedings;

secondly because even otherwise Rule 39 of 1977 Rules

makes it applicable, regardless of any other law.

Otherwise, arguably Sec.11 of CPC would not have stricto

sensu applied to the writ proceedings and in that

eventuality, broader doctrine would have been applicable.

If that be so, restrictive res judicata as internalized in

Sec.11 of CPC, and not the general doctrine of res judicata

would govern the writ proceedings. This aspect will have a

strong bearing on construing certain observations

occurring in the judgements suffered by the appellants in

earlier rounds of proceedings.

(E) AS TO WHAT WAS DIRECTLY AND SUBSTANTIALLY AT ISSUE IN THE EARLIER WRIT PETITIONS & WRIT APPEALS:

2000 (1) KarLJ 34

- 21 -

(a) As already discussed, what was challenged in

W.P.No.14885/1984 was the order of Land Tribunal passed

u/s 48A of the 1961 Act; this order admittedly did not say

even a word about the tenancy or vesting of subject lands

in the State in terms of section 44; it only found the

appellant-company as not answering the definition of

tenant in terms of Sec.2(34), and nothing beyond. Thus,

the limited challenge in the writ petition was to the

Tribunal's finding that the appellant-Company was not a

tenant. It is relevant to note that the State had not laid

any challenge to the Tribunal's order although it could, on

the ground that it did not provide for the vesting of subject

lands u/s.44. True it is, this section provides for vesting of

tenanted lands by operation of law; however, such vesting

is not automatic; living law of the people does not function

as an automatic machine. For vesting to happen, Triple

Test needs to be satisfied and the Tribunal which has

exclusive jurisdiction in the matters, has to record its

satisfaction, appropriate proceedings having been taken

up, pursuant to application in Form 7. An argument to the

- 22 -

contrary would risk the institution of private property to

peril.

(b) Ordinarily, the scope of Judicial Review at the

hands of Constitutional Court under Articles 226 & 227, is

determined by the scope of proceedings of statutory

tribunals/authorities whose orders are examined. As stated

above, the Tribunal is the exclusive body for adjudication

of the claim for occupancy u/s 48A of the 1961 Act; only it

can hold proceedings and record satisfaction of Triple Test;

only then land will vest in the State. A writ court cannot

vest the private property in the State sans adjudicatory

process on merits taking place at the hands of the

Tribunal. This view gains impetus from the observations in

BOREGOWDA L.G vs. BANGALORE DEVELOPMENT

AUTHORITY6. We repeat that, whether land had vested in

the State, was not decided at the hands of Tribunal.

W.A.No.1030/1988 filed by the appellants c/w

W.A.No.1867/1989 filed by the land owner. The

1983 SCC OnLine Kar 101

- 23 -

Coordinate Bench dismissed the same vide order dated

21.09.1990. At para 10, it had framed the following two

specific questions for consideration:

"1) Whether the Company was not entitled to grant of occupancy rights being a juristic person not capable of cultivating tenanted lands physically is it hence to be denied occupancy rights.

2) Does the denial of occupancy rights in the aforesaid circumstances to the Company render the Act retrospective?"

Paragraph 50 being prominent of them, was heavily

pressed into service by the learned AGA and therefore, it

is reproduced below:

"50. Having regard to the admitted facts and the principles laid down by this Court in the three decisions, supra we do not find any difficulty whatsoever in affirming the view taken by the learned Single Judge that with effect on and from the appointed date, the lands in respect of which the petitioner-Company claimed occupancy rights, stood transferred to and vested in the State Government with the consequences mentioned in sub-section 920 of Section 44 of the Act. We accordingly record and our finding on point No.1. This finding would be sufficient to dismiss Writ Appeal No.1867 of 1989."

(d) To us, the second question does not assume

relevance in the matter. The text of first question shows

- 24 -

that the Triple Test was not employed here too and rightly

so, because the fact matrix for its invokability was lacking,

no process on merits having taken place at the hands of

Tribunal. It is apparent from the judgment that no

question as to the vesting of subject lands in the State

obviously was articulated by the Bench and therefore, its

version as to vesting are only a passing observation. It is

more so because that question did not fall directly &

substantially for consideration. The said observations have

to be construed contextually in general and in the light of

specific questions that were framed for consideration in

the appeal, in particular. It has been a settled position of

law that court judgments cannot be construed as statutes;

in ABLEY vs. DALE7, it is observed that judgments should

be construed in their ordinary sense. On Indian soil too,

that is the prevalent view vide NAGARA PALIKA NIGAM

vs. KRISHI UPAJ MANDI SAMITI8. That being the

position, Mr.Acharya is right in telling us that these

observations cannot res judicate the appellants on the

11, C.B. 378,

AIR 2009 SC 187

- 25 -

issue of tenancy & vesting of lands. To put succinctly, the

resistance of Mr.Acharya to the invocation of expansive res

judicata qua the observations in the Coordinate Bench

judgments as to vesting of subject lands, merits

acceptance firstly for the reason that the Tribunal did not

say anything about vesting; secondly, because no question

was framed as to vesting in the coordinate proceedings;

thirdly, two questions framed in W.A.No.1030/1988 c/w

land owner's W.A.No.1867/1989 were specific and they

were de hors the Triple Test. Lastly, it can be arguably

added that the Deputy Commissioner's order dated

21.08.2007 being novum causa interveniens, there is no

scope for invoking res judicata, even in its widest sense.

(e) This court cannot blindly apply res judicata to

the appeal at hands in view of the observations of the

Apex Court in SAJJADANASHIN SAYED MD. B.E. EDR.

V. MUSA DADABHAI UMMER9:

"18. In India, Mulla has referred to similar tests (Mulla, 15th Edn., p. 104). The learned author says: a matter in respect of which relief is claimed in an earlier suit can be said to be

(2000) 3 SCC 350,

- 26 -

generally a matter "directly and substantially" in issue... The question arises as to what is the test for deciding into which category a case falls? One test is that if the issue was "necessary" to be decided for adjudicating on the principal issue and was decided, it would have to be treated as "directly and substantially" in issue and if it is clear that the judgment was in fact based upon that decision, then it would be res judicata in a latter case. One has to examine the plaint, the written statement, the issues and the judgment to find out if the matter was directly and substantially in issue...

19. We have here to advert to another principle of caution referred to by Mulla (p. 105):

"It is not to be assumed that matters in respect of which issues have been framed are all of them directly and substantially in issue... Which of the matters are directly in issue and which collaterally or incidentally, must be determined on the facts of each case..."

(F) AS TO OBSERVATIONS IN OTHER PROCEEDINGS BETWEEN THE PARTIES:

(a) Learned AGA next contended that: the

jurisdictional Tahsildar vide order dated 20.07.2000 had

directed mutation of entries in the revenue records

showing the government as the owner of subject lands

and that challenge thereto by the appellants in

W.P.No.26764/2000 was negatived vide order dated

6.12.2005; appellants' W.A.No.124/2006 against the same

also came to be dismissed vide order dated 6.9.2006;

- 27 -

therefore, the question of vesting no longer remains

unanswered for being reagitated in the appeal at hands.

This view is bit difficult to subscribe to and reasons for the

same are not far to seek: firstly, the learned Single

Judge's order dated 6.12.2005 has the following

observations at paras 11 & 12:

"...Examination of the impugned order cannot in any way resolve the basic dispute as to the nature of the land that had vested in the Government. The dispute of this nature is essentially a civil dispute which has to be received by a competent civil court... The order passed by the revenue authority is only for the purpose of showing the entries in the revenue records..."

In view of the above observations, the issue as to whether

the appellants still retained interest in the land was not

foreclosed.

(b) While dismissing appellants' W.A.No.124/2006,

the Co-ordinate Bench vide order dated 6.9.2006 at para 6

observed as under:

"Having regard to the contention of the learned AGA on behalf of the State-respondent that the land in question belong to the State Government, which is in un-authorised occupation of the appellants, since the Land Tribunal proceedings are concluded, it is open

- 28 -

for the State-Authorities to initiate such other proceedings which warrant in the facts and circumstances of the case to take possession of the same as expeditiously as possible in the interest of public."

Both the learned Single Judge and the Co-ordinate Bench

have mentioned about the Land Tribunal order dated

25.05.1984 and the proceedings that arose therefrom. As

already mentioned above, the Tribunal did not say one

single word about vesting of the land in the State; it could

not have said either inasmuch as the Triple Test was not

put to test in the said proceedings. Therefore, these orders

have to be construed as being collateral to the

foundational proceedings in which Land Tribunal order was

put in challenge. Added, the observations do not show the

vesting of land as to oust the appellants once for all from

the arena of lis. What is significant is the observation

made in the subject writ appeal 'it is open for the State

authorities to initiate such other proceedings which

warrants in the facts and circumstances of the case to take

possession...' Had the land been vested in the State, this

observation would not have been made at all. Simply the

- 29 -

Coordinate Bench would have directed the government to

take possession of the lands.

proceedings between the parties wherein, observations as

highlighted by the learned AGA do occur. Again we say

that they were made keeping in view what has been

stated in the base order namely the order dated

21.09.1990 rendered in W.A.No.1030/1988 c/w

W.A.No.1867/1989. We have already stated that the

observations made in this order cannot be construed to

the effect that these lands are vested in the State. It

hardly needs to be said that the judgments of courts

cannot be interpreted as the statutes of Westminster; they

have to be constructed in the light of proceedings in which

they have been rendered. Appellants are right in

contending that in view of restrictive res judicata enacted

in section 11 of CPC which is applicable to writ proceedings

as discussed above, the observations in the Coordinate

proceedings cannot foreclose their stand as to non-vesting

of lands in question, more particularly, the Tribunal having

- 30 -

not said even a word about it; it also did not say that

these lands were tenanted as on 1.3.1974, either.

(d) We can put the above contention of the

appellants in different words for the ease of

understanding: in view of restrictive incorporation of res

judicata in section 11 of CPC read with Rule 39 of 1977

Rules, the question whether lands have vested in the State

was not directly & substantially in issue in the Coordinate

proceedings and therefore, observations occurring in the

orders made therein in that regard do not res judicate the

appeal at hand. Mr.Acharya is justified in submitting that

whatever observations made by the Coordinate Benches

as to the vesting being demonstrably unnecessary for the

adjudication of the lis involved therein, have to be ignored

as 'passing observations' in contradistinction to the

'binding findings'. It hardly needs to be stated that for the

invocation of restrictive res judicata, the matter should be

directly & substantially in issue, and in the absence

thereof, what all is said is only a 'passing observations'

that do not attract the bar of res judicata; in precedential

- 31 -

sense, these observations can be likened to obiter dicta.

English Judges of yester decades often used to council that

courts should not make wider observations than is

required for deciding the case, be it on facts or in law.

Nowadays, it is not uncommon to find broader

observations when narrow would have been sufficient to

adjudge the matter.

(G) AS TO WHETHER THE SUBJECT LANDS BEING PLANTATION LANDS HAVE AGRICULTURAL CHARACTER:

(a) Learned Sr. Advocate Mr.M.B.Nargund and

B.L.Acharya appearing for the appellants submitted that

the subject lands do not have agricultural character and

therefore, they are miles away from the precincts of 1961

Act. In support of this contention, they pressed into

service another Coordinate Bench decision in

U.M.RAMESH RAO vs. UNION BANK OF INDIA10 in the

light of section 31(i) of the Securitisation and

Reconstruction of Financial Assets and Enforcement of

Security Interest Act, 2002. This Ruling was rendered in

2021 SCC OnLine Kar 6203

- 32 -

the context of the exemption that would avail to

agricultural lands from attachment & auction for

effectuating the security for recovery of bank loans. The

object & subject matter of these legislations are

indisputably different; so also, their legislative fields; the

former is relatable to Entry in the Union List whereas the

latter concerns Entry in the State List of VII Schedule to

the Constitution. Thus, we opine that the provisions of

2002 Act are not in pari materia with those of 1961 Act.

That being the position, the decision pressed into service

does not much come to the aid of appellants.

(b) Learned AGA whose performance needs to be

appreciated, at once drew our attention to paragraph 45 at

page 26 of the Coordinate Bench judgment dated

21.09.1990 wherein, admitted position as to the character

of subject lands is recorded. Relevant part of the same is

reproduced:

"The lands mentioned in the application filed by the petitioner-Company had been taken bys it for cultivation as a tenant.... The lands are plantations as defined under the provisions of the Act and in the Explanation to Section 104. The

- 33 -

crops raised by the petitioner-company are cardamom, coffee, pepper, rubber and coco."

Section 2(18) of the 1961 Act defines land to mean

'agricultural land, that is to say, land which is used or

capable of being used for agricultural purposes or

purposes subservient thereto and includes ... plantation' .

The definition is obviously expansive; it in so many words

excludes certain lands from its clasp and the subject lands

do not fall into that exclusion. In the course of time, the

term 'agriculture' is broadly enacted to include allied

activities/avocations like horticulture, floriculture,

aquaculture, dairy farming, poultry farming, grazing of

cattle. If these activities are associated with or take place

on the land, then such land would be agricultural in

character for the limited purpose of 1961 Act. Thus, it is

not just a conventional activity of rising of crop alone.

Added, the term 'plantation crops' is also defined to mean

cardamom, coffee, pepper, rubber and tea vide section

2(25). The definition of agriculture internalizes 'plantation'

is also obvious. Therefore, we are inclined to hold that the

- 34 -

subject lands had agricultural character and therefore,

cannot escape the clutches of 1961 Act.

which Mr.Nargund notified to us by reading out the

provisions of section 104 occurring in Chapter VIII of the

1961 Act. This Chapter provides for exemptions from

certain provisions. Section 104 which was heavily pressed

into service keeps the plantations away inter alia from the

confiscatory provisions enacted in sections 64, 79A, 79B &

80. Section 79 barred acquisition of land by persons

having non-agricultural income above Rs.50,000/- earlier

then enhanced to Rs.2,00,000/- and thereafter enhanced

to Rs.25,00,000/-. Section 79B(b)(ii) prohibited a

company like the appellant from holding the land. Section

80 proscribed transfer of agricultural land to non-

agriculturists. All these three provisions have been done

away with by Act 56 of 2020 and that too with

retrospective effect from the date they were brought on

the statute book i.e., from 01.03.1974. In other words,

the holding of land by the appellant-company under the

- 35 -

lease in question from the beginning shall be deemed to

be lawful. This amendment needs to be given full effect,

there being no controlling factors enacted therein. That

being the position, the substratum on which the claim for

occupancy was rejected and as a consequence, land was

arguable vested in the State, has been removed by

operation of amendment Act. Therefore, Deputy

Commissioner's order seeking to take possession of the

subject lands, and all other proceedings in which the same

was put in challenge, now rendered insignificant. This nova

lex interveniens enure to the benefit of the appellants.

This view gains support from the Apex Court decision in

STATE BANK'S STAFF UNION MADRAS vs UNION OF

INDIA, AIR 2005 SC 3446, wherein it is observed:

"...Whenever any amendment is brought in force retrospectively or any provision of the Act is deleted retrospectively, in this process rights of some are bound to be effective one way or the other..."

The right of the State to have the tenanted land vested in

it in terms of Section 44(1) of 1961 Act, thus has been lost

to the advantage of the appellants.

- 36 -

In the above circumstances, this appeal being meritorious, succeeds; the impugned order of the learned Single Judge is set at naught; appellants' W.P.No.1859/2008 (LR) having been favoured, a writ of certiorari issues quashing Deputy Commissioner's order dated 21.08.2007 coupled with a writ of mandamus to restore appellants' names to the revenue records within an outer limit of three months.

Costs made easy.

This court places on record its deep appreciation for the able research & assistance rendered by its official Law Clerk cum Research Assistant, Mr.Raghunandan K.S.

Sd/-

JUDGE

Sd/-

JUDGE

cbc/Snb/Bsv