Basant Ram vs Union Of India

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

Court: Supreme Court of India

Case Number: Not extracted

Decision Date: 24 January 1962

Coram: K.N. Wanchoo, P.B. Gajendragadkar

In this case, the petitioners Basant Ram and others appealed by special leave against the order of the Punjab High Court that had summarily dismissed their petition filed under Article 226 of the Constitution. The facts necessary for the present discussion are as follows. The petitioners migrated in 1947 from the area that now forms part of West Pakistan and settled in two villages named Sheikhapind and Kotla. Under the East Punjab Evacuees’ (Administration of Property) Act, No XIV of 1947, they were given temporary allotments of agricultural land in those villages. Subsequently, in 1948, a scheme was framed for quasi‑permanent allotment of agricultural land to the owners of land in West Pakistan after the enactment of the East Punjab Refugees (Registration of Claims) Act, No VIII of 1948. In July 1949 a notification was issued specifying the conditions under which such allotments would be made to displaced persons from East Pakistan. The notification indicated that the allotment would be quasi‑permanent, meaning it would continue so long as the land remained vested in the Custodian of Evacuee Property. Pursuant to that notification, the petitioners received quasi‑permanent allotments of agricultural land in Sheikhapind and Kotla in 1949 and they have remained in possession of that land ever since. Initially, land was classified only as urban or agricultural. In 1949, however, a third category called sub‑urban was introduced in practice for agricultural land situated near certain towns, and a notification appears to have been issued defining the villages whose land would be treated as sub‑urban, as recorded in Chapter V of the Land Settlement Manual compiled by Tarlok Singh. The two villages allotted to the petitioners were not included in that sub‑urban notification. In August 1950, after the quasi‑permanent allotments had been made, the Revenue Assistant (Rehabilitation) of Jullundur suggested that the two villages also be classified as sub‑urban, a re‑classification that would have reduced the area of land allotted to the allottees. The petitioners opposed this proposal before the Director General of Rehabilitation. The Director General ordered the Revenue Assistant to prepare a report and, on 12 January 1951, issued an order stating that it was not desirable at that stage to disturb the existing allotments by declaring the villages sub‑urban, and that the status quo should be maintained. Nevertheless, the matter did not conclude there. In February 1952 the Director of Rehabilitation issued an order effectively declaring the villages as sub‑urban, which meant that the petitioners’ allotments would have to be reduced. It also appears that an order dated April 1952, on paper, allocated the excess land that would be released from the petitioners’ allotments to other persons who had intervened in these proceedings, but that paper order was never implemented.

It was recorded that an order dated April 1952 had been drafted on paper to allocate the surplus land, which would become available after reducing the appellants’ allotment, to other persons who had intervened in the appeals; however, that order remained only on paper and had not been implemented. When the appellants learned of the February 29 1952 order declaring the two villages as sub‑urban, they filed a revision before the Custodian General seeking to set aside that order. The revision was heard by the Deputy Custodian General in January 1956, by which time two statutory changes had occurred. First, rule 14(6) of the Administration of Evacuee Property (Central) Rules, framed under the Administration of Evacuee Property Act (Central Act XXXI of 1950), had been amended. Second, the Displaced Persons (Compensation and Rehabilitation) Act, Central Act XLIV of 1954, had been enacted. The amendment to rule 14(6) conferred power to cancel or vary any quasi‑permanent allotment of rural evacuee property, provided the cancellation or variation was made in accordance with a general or special order of the Central Government. Correspondence between the Punjab Government and the Central Government resulted in an order under the amended rule 14(6)(iii)(d) being issued on October 11 1955. Consequently, the Deputy Custodian General held that, in view of rule 14(6)(iii)(d), the Central Government could, by special order, direct the cancellation or variation of the appellants’ allotment and that, on the representation of the Punjab Government, the Central Government had agreed to declare the two villages as sub‑urban by its October 11 1955 order. He therefore concluded that any action taken after that date was undertaken pursuant to the Central Government’s order, rendering the February 29 1952 order, even if revisable, no longer operative and making the pending revisions moot; consequently, he dismissed the revision petitions. The appellants subsequently approached the Punjab High Court with a writ petition, which was dismissed summarily, and their application for leave to appeal to this Court was refused. They then obtained special leave to this Court, bringing the matter before us. The appellants’ principal contention before this Court is that, with the commencement of the Displaced Persons Act and the notification issued under section 12 of that Act on March 24 1955, the land allotted to them in the two villages ceased to be evacuee property and became part of the compensation pool created by the Act. Accordingly, they argue that the Central Government no longer possessed any power under the Central Act XXXI of 1950 and its Rules to act, and that the October 11 1955 order, on which the Deputy Custodian General relied to reject the revisions, was beyond the Central Government’s competence. They further maintain that no authority under the Central Act XXXI of 1950 could lawfully vary the appellants’ allotment by reducing its area, and that any action required after the March 24 1955 notification could only be taken under the Displaced Persons Act, which, they assert, has not been exercised.

In this matter, the Court considered the operation of Central Act XXXI of 1950 together with the rules made thereunder. The Court observed that the order issued by the Central Government on 11 October 1955, which formed the basis for the Deputy Custodian General’s rejection of the revision petitions filed by the appellants, was beyond the competence of the Central Government. Because the order declared the two villages to be “sub‑urban,” the Court held that no authority could rely on that order to alter the existing allotments made in favour of the appellants. Consequently, the authorities could not, under Central Act XXXI of 1950, reduce the area that had been allotted to the appellants by invoking the sub‑urban declaration. The appellants further contended that any step to be taken after the notification dated 24 March 1955 must be undertaken solely under the provisions of the Act, and that, in fact, no such step had been taken. The Court found merit in this contention and concluded that it must be upheld.

The Court then analysed the relevant statutory provisions. Section 12(1) of the Act states that, if the Central Government is of the opinion that it is necessary to acquire any evacuee property for a public purpose connected with the relief and rehabilitation of displaced persons, including the payment of compensation, the Government may at any time acquire such property by publishing a notification in the Official Gazette indicating its decision to acquire the property under this section. Sub‑section (2) provides that, upon publication of the notification, the right, title and interest of any evacuee in the specified property shall be extinguished and the property shall vest absolutely in the Central Government, free from all encumbrances. Sub‑section (4) adds that all evacuee property acquired under this section shall become part of the compensation pool. Section 14 creates the compensation pool, while Section 16 confers on the Central Government the power to manage the pool, including the appointment of managing officers or the constitution of managing corporations. Section 17 describes the functions of these managing officers and corporations. Importantly, Section 19 provides that, notwithstanding any contract or other law then in force, and subject to any rules made under the Act, the managing officer or managing corporation may cancel any allotment, terminate any lease, or amend the terms of any lease or allotment of evacuee property, whether such allotment or lease was granted before or after the commencement of the Act. The Court noted that rules have been framed under the Act to specify the circumstances in which a managing officer or managing corporation may cancel an allotment or terminate a lease, thereby clarifying the procedure for any variation of rights after the property has entered the compensation pool.

Rule 102 of the Rules framed under the Act described the circumstances in which a managing officer or managing corporation might vary the terms of a lease or allotment. It was not contested that the property situated in the two villages had been notified as evacuee property under section 12(1) of the Act on 24 March 1955. The effect of that notification was that all rights, title and interest that the evacuee previously held in the land were extinguished, and consequently the land no longer qualified as evacuee property. Because the land ceased to be evacuee property, it could no longer be governed by the Central Act No XXXI of 1950 or by any Rules made under that Act. After the 24 March 1955 notification, the land became part of the compensation pool and therefore could be dealt with only under the provisions of the Evacuee Property Act itself. Any subsequent alteration or cancellation of a lease or allotment concerning that land could be effected solely under section 19 of the Act. This conclusion followed from a careful reading of sections 12, 14, 16 and 19 in the context of the 24 March 1955 notification concerning the two villages.

The Punjab High Court articulated the same view in Balmukand v. The Punjab State [I.L.R. 1957 Punj. 712], and this Court reaffirmed that approach in Major Gopal Singh v. Custodian, Evacuee Property, where it held that from the date of the section‑12 notification the Custodian became functus officio with respect to the property and could not rectify any earlier error in cancelling an allotment. Accordingly, once the 24 March 1955 notification was issued, the land ceased to be evacuee property, entered the compensation pool and could be addressed only under the Act, with any variation or cancellation permissible exclusively under section 19. No authority remained for the Central Government to act under rule 14(6)(iii)(d) of the Rules made under the Central Act No XXXI of 1950 with respect to that land after the notification date. The Deputy Custodian General’s order of January 1956 indicated that further proceedings were contemplated under the order dated 11 October 1955, which the Central Government had issued pursuant to rule 14(6)(iii)(d). However, because that order was issued after the 24 March 1955 notification—at a time when the Central Government’s power under the Central Act had already ceased with respect to the two villages—the order must be set aside and no additional proceedings may be taken under it. The Court therefore set aside the order, awarded costs to the appellants, and clarified that it expressed no opinion on the dispute between the appellants and the interveners, who remain free to pursue any remedies available to them under law.

The Court expressly refrained from expressing any view regarding the dispute that existed between the appellants and the interveners, and it indicated that the interveners must pursue whatever legal remedies were available to them under the applicable law.