Sakharam Bapusaheb Narayan Sanas And... vs Manikchand Motichand Shah And Another

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: supreme-court

Case Number: Civil Appeal No. 185 of 1956

Decision Date: 19 April, 1961

Coram: Bhuvneshwar P. Sinha, Raghubar Dayal

In this matter, the Supreme Court of India examined an appeal titled Sakharam Bapusaheb Narayan Sanas and another versus Manikchand Motichand Shah and another, the judgment of which was rendered on 19 April 1961. The judgment was authored by Justice Bhuvneshwar P. Sinha, who sat on the bench together with Justice Raghubar Dayal. The parties were identified as the petitioners, SAKHARAM BAPUSAHEB NARAYAN SANAS and another, and the respondents, MANIKCHAND MOTICHAND SHAH and another. The case citation appears in several reports, namely 1963 AIR 354, 1962 SCR (2) 59, and it is also referenced in citator information as E 1963 SC 358 (4,5), R 1966 SC 367 (6), O 1966 SC 538 (5,10), D 1966 SC1758 (11), R 1980 SC 101 (3), RF 1986 SC2204 (5) and RF 1991 SC1538 (7). The bench composition is recorded again as Chief Justice Bhuvneshwar P. Sinha together with Justices Subbarao K. Dayal and Raghubar, reinforcing the judicial panel that considered the appeal.

The substantive dispute concerned the status and protection of tenancy rights under several statutes. The appellants had obtained the status of protected tenants pursuant to section 3A(1) of the Bombay Tenancy Act, 1939, as amended by the Bombay Tenancy (Amendment) Act, 1946, and these rights were entered in the Record of Rights. Subsequent legislation, namely the Bombay Tenancy and Agricultural Lands Act, 1948, repealed the earlier Act but preserved, under section 31, the rights previously acquired. Section 88(1)(c) of the 1948 Act excluded its operation in areas within two miles of the limits of the Poona Municipal Borough, encompassing Poona City and its suburbs, as well as certain other boroughs. Moreover, section 89(2) expressly stated that nothing in the Act or its repeal would affect any right, title, interest, obligation or liability that had already been acquired, accrued, or incurred before the commencement of the 1948 Act, nor would it prejudice any legal proceeding relating to such pre‑existing rights. The lands in dispute lay within the specified two‑mile radius of Poona, raising the question of whether the appellants’ protected‑tenant rights were extinguished by the repeal. The Court held that the provisions of section 88 of the 1948 Act were wholly prospective, applying only to lands described in clauses (a) to (d) of section 88(1) from the date the Act came into force on 28 December 1948. The Court further concluded that these provisions were not confiscatory; they did not divest a tenant of a protected‑tenant status already accrued, and section 89(2)(b) was intended to conserve such pre‑existing rights and to allow any related legal proceedings to continue as if the 1948 Act had not been enacted.

The Court observed that Section 89(2)(b) of the Bombay Tenancy and Agricultural Lands Act was intended to preserve the status of a protected tenant that had already accrued to him before the Act commenced. The provision expressly aimed to conserve rights that were acquired or accrued prior to its commencement, and it mandated that any legal proceeding concerning those rights be decided under the provisions of the earlier Bombay Tenancy Act of 1939. The Court distinguished the earlier authority of Abbot v. The Minister for Lands, [1995] A.C. 425, in reaching this conclusion.

The matter before the Court was a civil appeal, numbered 185 of 1956, filed by special leave from a judgment and decree dated 25 November 1954 rendered by the Bombay High Court in Second Appeal No. 1003 of 1952. The appeal was heard by a bench comprising Justice H. R. Gokhale, Justice B. Dadachanji, Justice S. N. Andley, Justice Rameshwar Nath and Justice P. L. Vohra, who appeared on behalf of the appellants. Counsel for the respondent No. 1 were present. The judgment was delivered by Chief Justice Sinha. The sole issue for determination was whether the defendants‑appellants qualified as “protected tenants” within the meaning of the Bombay Tenancy Act of 1939, and consequently whether their rights as protected tenants remained unaffected by the repeal of that Act by the Bombay Tenancy and Agricultural Lands Act of 1948. The lower courts had decreed in favour of the plaintiff, granting possession of the disputed lands on the basis that the defendants were not entitled to the protection of “protected tenants”. The appeal was entertained after the Supreme Court granted special leave on 4 April 1965. The factual background, which was not contested, showed that the defendants had obtained a lease of the lands in question on 30 October 1939 for a term of ten years, set to expire on 30 October 1949. The lands lay within two miles of the limits of Poona Municipality. The landlord issued a notice on 22 October 1948 terminating the tenancy as of 30 October 1949. Because the defendants failed to vacate after the notice, the plaintiff instituted an ejectment suit in the Civil Judge, Junior Division at Poona, recorded as Civil Suit No. 86 of 1950. The 1939 Act became effective on 27 March 1940, but its application to the Poona area commenced on 11 April 1946. Under Section 3 of that Act, a tenant is deemed a “protected tenant” if he has continuously held the land for not less than six years immediately preceding either 1 January 1938 or 1 January 1945 (as added by the 1946 amendment) and has personally cultivated the land during that period. It was undisputed that the defendants‑appellants acquired the status of “protected tenants” by virtue of the operation of the amended Act.

In this case the Court explained that, because of the operation of the Bombay Tenancy (Amendment) Act, 1946, and the effect of section 3A(1) of the Bombay Tenancy Act, the defendants were automatically considered protected tenants and that their rights as protected tenants were entered in the Record of Rights. The Court then reproduced the relevant statutory language. Section 3 provides that a tenant shall be deemed to be a protected tenant in respect of any land if (a) the tenant has held the land continuously for a period of at least six years immediately preceding either the first day of January 1938 or the first day of January 1945, and (b) the tenant has cultivated the land personally during that period. Section 3A(1) adds that every tenant shall, on the expiry of one year from the date on which the Bombay Tenancy Amendment Act of 1946 comes into force, be deemed to be a protected tenant for the purposes of the Act and that the tenant’s rights as a protected tenant shall be recorded in the Record of Rights unless, within that one‑year period, the landlord makes an application to the Mamlatdar having jurisdiction over the land for a declaration that the tenant is not a protected tenant.

The Court noted that under section 3A(1) the landlord had the opportunity, within one year of the commencement of the 1946 amendment, to apply to the Mamlatdar for such a declaration, but that no application was ever filed. Consequently, after the one‑year period elapsed on 8 November 1946, the defendants were deemed to be protected tenants, and it was not contested that they were entered as such in the Record of Rights. The Court observed that section 4 of the 1939 Act dealt with further provisions for recovery of possession by tenants who had been evicted under the circumstances described in that section, but that the present dispute did not involve section 4. The Court therefore concluded that, in its terms, the 1939 Act was intended to safeguard tenants in certain areas of the Province of Bombay as it then existed. Had no later legislative change occurred, the defendants would have retained the status of protected tenants and could not have been removed from their holdings except in accordance with the procedures laid down in the Tenancy Law.

However, the Court pointed out that the Bombay Tenancy Act of 1939 was later replaced by the Bombay Tenancy Act of 1948. The issue before the Court was whether the 1948 Act extinguished the defendants’ status as protected tenants. To answer that question, the Court examined the relevant provisions of the later statute. Section 2 clause (14) of the 1948 Act, as it stood before its amendment by Bombay Act XIII of 1956, defined “protected tenant” to mean a person who is recognised as a protected tenant under section 31 of the same Act. The Court then quoted section 31, which reads: “For the purposes of this Act, a person shall be recognised…”

According to section 31 of the 1948 Act, a person is to be regarded as a protected tenant only if that person has been deemed a protected tenant under section 3, section 3A or section 4 of the Bombay Tenancy Act, 1939. The Court indicated that the operative force and effect of section 31 would be examined later when addressing the arguments presented by the landlord‑respondent. The next provision of relevance in the 1948 Act is section 88(1)(c), which states that none of the preceding provisions of the Act shall apply to any area that lies within the limits of Greater Bombay, the municipal boroughs of Poona City and Suburban, Ahmedabad, Sholapur, Surat and Hubli, or to any land situated within a distance of two miles from the limits of such boroughs. It has already been established that the lands which are the subject of the present dispute are located within two miles of the limits of the Poona Municipal Borough; for the purposes of this case that borough is treated as equivalent to the “Borough of Poona City and Suburban.” The respondent‑landlord therefore contended that, under the later 1948 Act, the disputed lands fall outside the statutory purview and consequently the defendants‑appellants cannot lay claim to the status of protected tenants. In response, the appellants relied upon section 89, particularly subsection (1) which repeals the enactments listed in the Schedule to the extent specified, and subsection (2)(b) which provides that, except as expressly provided in the Act, nothing in the Act or any repeal effected thereby shall affect or be deemed to affect any right, title, interest, obligation or liability already acquired, accrued or incurred before the commencement of the Act, nor any legal proceeding or remedy relating to such rights or obligations, and that any such proceeding shall continue and be disposed of as if the Act had not been passed. The appellants argued that the repeal effected by section 89, read with the Schedule, clearly saves the entirety of sections 3, 3A and 4 of the 1939 Act, subject only to certain modifications that are not material to the present issue, and that sub‑paragraph (2)(b) of section 89 expressly preserves the appellants’ rights as protected tenants because those rights had already accrued under the 1939 Act. The respondent‑respondent’s counsel rebuffed this contention on three separate grounds. First, section 88 expressly provides that sections 1 to 87 of the later Act shall not apply to lands situated in the Municipal Borough of Poona City and Suburban and within two miles of the limits of that borough. Second, the saving clause in sub‑paragraph (b) of subsection (2) of section 89 does not preserve every right; it preserves only those rights that had actually been exercised and recognized. Third, the terms of the saving clause in section 89(2)(b) are not identical to those of section 7 of the Bombay General Clauses Act, because the former merely speaks of proceedings being continued and disposed of, without reference to the institution of such proceedings.

It was submitted that clause (b) of sub‑section (2) of section 89 does not preserve every right that existed under the earlier legislation; rather, it saves only those rights that had actually been exercised and formally recognised. In addition, it was argued that the language of the saving provision contained in section 89(2)(b) is not identical to the language of section 7 of the Bombay General Clauses Act, because clause (b) refers solely to proceedings that are to be continued and disposed of, without mentioning the institution of such proceedings. In brief, the appellants contended that the removal of the status of “protected tenant” for certain lands, as specified in section 88, was intended to operate only prospectively and should not affect rights that had already arisen in the past. By contrast, the respondent argued that the repeal effected by section 88 was retrospective and that only the rights falling squarely within the expression of clause (b) of section 89(2) were saved, and that the right claimed by the appellants had been expressly taken away by section 88.

The Court observed that the second ground of the respondent’s argument could be disposed of at the outset, thereby clearing the way for a deeper examination of the combined effect of sections 88 and 89, which formed the core of the dispute. The plaintiff‑respondent’s counsel heavily relied upon observations of the Lord Chancellor in Abbot v. The Minister for Lands (1895) A.C. 425, 431, where it was stated that a mere abstract right existing in a class of persons, without any act by an individual to put that right into effect, could not be regarded as a “right accrued” within the meaning of the enactment. The contention advanced by the respondent was that, for the appellants to claim the status of “protected tenants” as an accrued right under the 1939 Act, they needed to have taken definitive steps to enforce that right and obtain a declaration from the appropriate authorities; since the appellants had not undertaken such steps, they could not assert that they possessed an accrued right. The Court found this contention to lack substance. While the Lord Chancellor’s observations were respected, they were deemed applicable only to the specific statute that gave rise to the controversy in Abbot. In that case, the appellant had obtained a fee‑simple grant of land under the Crown Lands Alienation Act, 1861, which authorized the appellant to claim settlement of additional lands if certain statutory conditions were satisfied. The original grant thereby conferred a contingent right to acquire further lands, contingent upon fulfilment of the conditions laid down in the Crown Lands Alienation Act, 1861, and not an unconditional, automatically accrued right.

The Act of 1884 repealed the earlier Crown Lands Alienation Act of 1861 and incorporated a saving provision. That saving provision declared that all rights accrued by virtue of the repealed enactment would, subject to any explicit provisions of the 1884 Act, remain unaffected by the repeal. The appellants argued that, under this saving clause, they possessed a right to make additional conditional purchases, which they claimed qualified as a “right accrued” within the meaning of the 1884 saving provision. The Privy Council rejected this contention and held that the appellants’ alleged right did not constitute a “right accrued” under the saving clause. Consequently, the Court emphasized that the observations cited by the respondent were made in a different statutory context and could not be applied to the present dispute. The Privy Council decision is authoritative only for the proposition that a mere right existing at the date of a repealing statute does not amount to a “right accrued” within the ordinary saving clause. Such a right merely permits the holder to take advantage of the provisions that have been repealed. In that ruling, the Privy Council assumed that the original grantee possessed a contingent right, yet it concluded that this contingent right was not a “right accrued” as defined by the repealed statute. The Court held that the contingent right had not accrued because the option to make additional purchases was not exercised before the 1884 repeal took effect. In other words, the right the original grantee hoped to exercise did not exist at the moment the repealing Act became operative, and therefore the repealing statute lawfully limited that right. By contrast, in the present matter, the appellants acquired the status of a “protected tenant” while the Act of 1939 remained in force. No further action on their part was required to create that right. The public authorities recognized this right by entering the appropriate entries in the Record of Rights, as previously noted. Conversely, section 3A(1) of the 1939 Act granted the landlord‑respondent the authority to initiate proceedings before the mamlatdar to obtain a declaration that the tenant had not attained the status of a “protected tenant”. The landlord‑respondent chose not to pursue such a declaration, and therefore the appellants’ protected‑tenant status remained unchallenged. Accordingly, it is clear that, for the appellants, the public authorities had already recognized them as protected tenants under the 1939 Act. No additional steps were necessary to satisfy the requirement of a “right accrued” under clause (b) of section 89(2) of the 1948 Act.

Having found that the second ground of attack on the appellants’ claim lacked legal foundation, the Court turned to consider the first ground. The first ground alleged that an express provision in section 88, read with section 89(2)(b), removed the appellants’ right. In this respect, counsel for the respondent pointed out that section 88(1) explicitly provides that sections 1 to 87 of the 1948 Act shall not apply to lands of the situation of the disputed lands. The Court noted that this provision, together with section 31, has been advanced in support of the respondent’s argument. In this connection, it was pointed out on behalf of the respondent that s. 88(1) in terms provides that ss. 1 to 87 of the Act of. The issue therefore turned on the construction of section 88 in light of the provisions of section 89, and whether that construction resulted in the removal of the appellants’ right. Accordingly, the respondent urged that the plain wording of section 88(1) demonstrated the legislature’s intention to exclude the application of sections 1 through 87 to the lands in dispute. The Court indicated that a careful reading of the statutory language was necessary to determine whether the provision operated prospectively or had retrospective effect on existing rights.

The Court observed that Section 31 of the 1948 Act began with the words “For the purposes of this Act” and that this provision had been cited in support of the argument. It noted that the rights and liabilities of a protected tenant under the 1948 Act were not identical to those under the 1939 Act. Although Sections 3, 3‑A and 4 of the earlier 1939 Act had been incorporated into the later legislation, the Court explained that they had been incorporated in a manner that gave greater facilities and larger rights to those described as “protected tenants”. In other words, Section 31 was enacted not to eliminate the rights contained in Sections 3, 3‑A and 4 of the earlier statute, but to extend the same terminology to the larger set of rights created under the 1948 Act. The Court further held that the provisions of Section 88 were wholly prospective. They applied only to lands described in clauses (a) to (d) of Clause 88(1) from the date on which the 1948 Act came into operation, namely 28 December 1948. The Court clarified that these provisions were not intended to be confiscatory and did not demonstrate an intention to take away rights that had already accrued to tenants who had acquired the status of “protected tenant”. By contrast, Section 89(2)(b), as quoted earlier, clearly manifested a legislative intention to preserve such pre‑existing rights. The Court also addressed the respondent’s third ground of attack, which argued that sub‑clause (ii) of clause (b) of Section 89(2) indicated that the legislature did not intend to fully re‑enact the provisions of Section 7 of the Bombay General Clauses Act because the word “instituted” was missing before the words “continued and disposed of”. The Court rejected this contention, explaining that sub‑clause (i) was independent of sub‑clause (ii) and therefore the latter could not diminish the legal significance of the former.

The Court continued that sub‑clause (ii), which referred to pending litigation, might concern the forum in which proceedings under the repealed Act would be heard, whether in a Civil Court or a Revenue Court. The Court reiterated its earlier holding that the phrase “right accrued” in sub‑clause (i) did not exclude the rights claimed by the appellants as protected tenants. It reminded that a recognized legal right is always accompanied by a remedy, and in the absence of a special provision designating a particular forum for enforcement, the general law would naturally determine the appropriate forum. In this context, the Court found it relevant to refer to the observations of the High Court, which had suggested that even if the right of a protected tenant remained vested after the enactment of Section 88(1), that right would be “illusory” in enforcement against the plaintiff. The Court disagreed with that view, stating that courts would be very slow to deem a right illusory when no specific forum had been indicated. Finally, the Court explained that the effect of sub‑clause (ii) was merely to ensure that any legal proceeding concerning the right claimed by the defendants would be continued and disposed of as if the 1948 Act had not been passed. Applying this principle to the present case, the Court concluded that the controversy must be resolved according to the provisions of the repealed 1939 statute, reflecting the legislature’s intention that the current litigation be decided on the basis of that earlier law.

In this case the Court observed that even if it were assumed that the right of a protected tenant continued to vest in the defendants after the enactment of section 88(1), the enforcement of that right against the plaintiff would have to be treated as an illusion. The Court stated that such observations were not well‑founded. It explained that courts are very reluctant to presume the existence of a right and then declare that right to be illusory, especially where no specific forum for enforcement has been identified. The Court then turned to the legal effect of sub‑paragraph (ii) of the relevant provision and held that its sole consequence is to require that any legal proceeding concerning the right claimed by the defendants be continued and disposed of as if the 1948 Act had never been enacted. Applying this principle to the present dispute, the Court inferred that the controversy must be resolved by referring to the provisions of the statute that has been repealed. The Court concluded that the legislature intended the present litigation to be decided under the repealed 1939 statute. It was not contested before the Court that, if the matter is decided under that repealed statute, the only correct outcome is to dismiss the suit and award costs. Consequently, the Court allowed the appeal, set aside the judgments of the lower courts, and dismissed the suit with costs payable throughout to the contesting defendants‑appellants. The appeal was therefore allowed.