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: Civil Appeal No. 766 of 1957

Decision Date: 24 January 1962

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

In Basant Ram versus Union of India, decided on 24 January 1962, the Supreme Court of India issued its judgment. The opinion was written by Justice K.N. Wanchoo and the bench also included Justice P.B. Gajendragadkar. The petitioner was Basant Ram and the respondent was the Union of India. The decision was reported in 1962 AIR 994 and in the Supplement to the Supreme Court Reporter, volume 2, page 733. The matters before the Court involved the Administration of Evacuee Property (Central) Rules, specifically rule 14(6), the Administration of Evacuee Property Act of 1950, and sections 12, 14, 16 and 19 of the Displaced Persons (Compensation and Rehabilitation) Act of 1954. The factual background recorded that the appellants had migrated to India in 1947 from what is now West Pakistan. Initially they received temporary allotments of agricultural land in two villages, and in 1949 they were granted quasi‑permanent allotments which they continued to occupy. At first the land in the two villages was classified as either urban or agricultural, but later a third category, sub‑urban land, was introduced. The two villages in which the appellants held land were not listed in the notification concerning sub‑urban land. In February 1952 the Director of Rehabilitation issued an order declaring those villages to be sub‑urban land, which resulted in a reduction of the allotments made to the appellants. The appellants challenged that order by filing revision petitions before the Custodian General; those petitions were dismissed on the ground that, under rule 14(6)(iii)(d), the Central Government could, by a special order, direct cancellation or variation of an allotment, and that the Central Government, on representation of the Punjab Government, had agreed to declare the two villages as sub‑urban by an order dated 11 October 1955. The appellants subsequently filed a writ petition in the High Court, which was dismissed summarily. They then obtained special leave to appeal before this Court. The Court held that the notification dated 24 March 1955, issued under section 12 of the Displaced Persons (Compensation and Rehabilitation) Act, 1954, transformed the evacuee property in those villages into a component of the compensation pool, and that such property could be dealt with only under the 1954 Act. Accordingly, any variation or cancellation of the allotment could be effected only under section 19 of that Act, and the Central Government no longer possessed any power under rule 14(6)(iii)(d) of the Rules made under the Administration of Evacuee Property Act, 1950, with respect to the land after the March 1955 notification. The Court relied on Balmukand v. State of Punjab, I.L.R. 1957 Punjab 712 and Major Gopal Singh v. Custodian of Evacuee Property, A.I.R. 1961 S.C. 1320. The judgment was delivered in civil appellate jurisdiction in Civil Appeal No. 766 of 1957, filed by special leave.

Special leave was granted to challenge the judgment and order dated 31 January 1966 of the Punjab High Court in Civil Writ Petition No. 30 of 1956. Counsel identified as R. S. Narula appeared for the appellants, while B. K. Khanna and P. D. Menon represented the respondents. S. L. Pandhi acted for the interveners. The judgment was pronounced on 24 January 1962 by Justice Wanchoo. The Court described the proceeding as an appeal by special leave against the High Court’s summary rejection of a petition filed by the appellants under Article 226 of the Constitution. The Court noted that only the brief facts essential for present consideration would be set out. The appellants had migrated in 1947 from the area that later became West Pakistan and had taken residence in two villages called Sheikhapind and Kotla. Under the East Punjab Evacuees’ (Administration of Property) Act, No. XIV of 1947, which was then in force, they received temporary allotments of agricultural land in those villages. Subsequently, in 1948, a scheme was prepared to grant quasi‑permanent allotments of agricultural land to 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 specified the conditions for allotting agricultural land to displaced persons from West Pakistan. The allotments were described as quasi‑permanent, meaning they would continue as long as the land remained vested in the Custodian of Evacuee Property. Pursuant to that notification, the appellants were allotted land in Sheikhapind and Kotla on a quasi‑permanent basis in 1949 and they have remained in possession of that land ever since.

Initially, land was classified into two categories: urban and agricultural. In 1949 a third category, sub‑urban, was introduced for agricultural land lying near certain towns, and a notification appears to have been issued to identify villages whose land would be treated as sub‑urban, as recorded in Chapter V of the Land Settlement Manual prepared by Tarlok Singh. The two villages where the appellants held land 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 proposed that Sheikhapind and Kotla also be classified as sub‑urban, which would have reduced the area of land allotted to the allottees. The appellants objected to this re‑grading before the Director General of Rehabilitation. Responding to the objection, the Director General requested a report from the Revenue Assistant and eventually issued an order on 12 January 1951 stating that it was not advisable at that stage to disturb the existing allotments by declaring the villages sub‑urban and that the status quo should be maintained. However, the matter did not conclude there. In February 1952 the Director of Rehabilitation issued an order effectively declaring the two villages to be sub‑urban, which set the stage for further disputes concerning the reduction of the appellants’ land holdings.

The Court noted that the order issued on 29 February 1952 would have necessitated a reduction in the land allotted to the appellants. It further observed that an additional order, dated April 1952, was drafted on paper to allocate the surplus land – that is, the land that would be released from the appellants’ allotment – to other persons who had intervened in the present appeals. However, that April order never left the paperwork and was not implemented. Upon learning of the February 1952 order, the appellants submitted a revision application to the Custodian General, seeking to have that order set aside. The revision was subsequently placed before the Deputy Custodian General for consideration in January 1956. By that time, significant legislative and regulatory changes had occurred. First, rule 14(8) of the Administration of Evacuee Property (Central) Rules, formulated 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 (hereinafter “the Act”), had been enacted. The amendment to rule 14 conferred authority 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. In the interval, correspondence between the Punjab Government and the Central Government resulted in an order issued under the amended rule 14(6)(iii)(d) on 11 October 1955.

When the Deputy Custodian General examined the revision in light of rule 14(6)(iii)(d), he held that the Central Government, by virtue of a special order, could direct the cancellation or variation of the allotment made to the appellants. He further observed that, acting on a representation from the Punjab Government, the Central Government had agreed to declare the two villages as sub‑urban in its order dated 11 October 1955; consequently, any action taken after that date was undertaken pursuant to the Central Government’s order. The Deputy Custodian General therefore concluded that the challenged order of 29 February 1952, even if technically subject to revision, had been superseded and no longer governed the situation. All future action was to be taken under the October 1955 order, rendering the appellants’ revision proceedings moot, and he dismissed them. Thereafter, the appellants filed a writ petition in the Punjab High Court, which was summarily dismissed. The High Court refused leave to appeal, prompting the appellants to seek special leave before this Court, which was granted. The principal contention raised by the appellants before this Court is that, following the commencement of the Act and the notification issued under section 12 on 24 March 1955, the land allotted to them in the two villages ceased to be…

It was submitted that, once the land in the two villages became part of the compensation pool created under Section 12 of the Act, the Central Government no longer possessed any authority to act under Central Act XXXI of 1950 or the rules made thereunder. Consequently, the order issued by the Central Government on 11 October 1955—which formed the basis on which the Deputy Custodian General dismissed the revision petitions filed on behalf of the appellants and declared the two villages to be sub‑urban—was held to be beyond the competence of the Central Government. Because that order exceeded the Government’s jurisdiction, no action could lawfully be taken under it to vary the allotments made in favour of the appellants by reducing the area allotted to them. The appellants further argued that any subsequent action after the notification dated 24 March 1955 could only be undertaken under the provisions of the Act, and that, in fact, no such action had been taken. The Court was of the view that the appellants’ contention possessed merit and ought to prevail.

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 to such persons, it may at any time acquire such property by publishing a notification in the Official Gazette to the effect that it has decided to acquire the evacuee property in pursuance of this section. Sub‑section (2) provides that, upon publication of such a notification, the right, title and interest of any evacuee in the property specified in the notification shall be extinguished, and the property shall vest absolutely in the Central Government, free from all encumbrances. Sub‑section (4) further provides that all evacuee property acquired under this section shall form part of the compensation pool.

Section 14 creates the compensation pool, while Section 16 confers on the Central Government the power to manage that pool. Management may be carried out by appointing officers, referred to as managing officers, or by constituting an authority or corporation, referred to as managing corporations, as the Government deems fit. Section 17 outlines the functions of these managing officers and managing corporations. Section 19, which is of particular importance, provides that, notwithstanding anything contained in any contract or any other law then in force, but 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 under which evacuee property acquired under the Act is held or occupied by a person, whether such allotment or lease was granted before or after the commencement of the Act.

Rules have been framed under the Act to specify the circumstances in which a managing officer or managing corporation may cancel an allotment, terminate a lease, or vary the terms of any such lease or allotment.

In this case, the Court examined the provision of the Act that sets out the circumstances in which a managing officer or a managing corporation may cancel an allotment, terminate a lease, or vary the terms of any such lease or allotment (reference rule 102). The Court noted that there was no dispute that the evacuee property located in the two villages had been notified under section 12 of the Act on 24 March 1955. The effect of that notification, as the Court explained, was that all rights, title and interest of the evacuee in the property ceased, and consequently the land ceased to be evacuee property. Because the land was no longer classified as evacuee property, the Court held that it could not thereafter be dealt with under Central Act No XXXI of 1950 or the Rules made under that Act. The Court observed that once the notification of 24 March 1955 took effect, the property in the two villages became part of the compensation pool created under the Act. Therefore, any subsequent dealing with that property had to be governed by the provisions of the Act itself, and any variation, cancellation or amendment of a lease or allotment could be made only under section 19 of the Act. The Court reached this conclusion by considering sections 12, 14, 16 and 19 of the Act in the light of the notification made under subsection 12(1) on the date specified. The Court referred to the decision of the Punjab High Court in Balmukand v. The Punjab State, which adopted the same approach, and also to its own earlier decision in Major Gopal Singh v. Custodian, Evacuee Property, where it was held that from the date of the notification under section 12, the Custodian became functus officio with respect to the property and could not correct any past error concerning cancellation of an allotment. Consequently, the Court concluded that after the 24 March 1955 notification, the land could be dealt with only under the Act, and any alteration of an allotment required reliance on section 19. No authority remained with the Central Government to act under rule 14(6)(iii)(d) of the Rules made under Central Act No XXXI of 1950 with respect to this land after that date. The Court then examined the order issued by the Deputy Custodian General in January 1956, which indicated that further proceedings concerning the land were to be pursued under an order dated 11 October 1955, issued by the Central Government under rule 14(6)(iii)(d). The Court observed that this order was issued after the 24 March 1955 notification, at a time when the power of the Central Government to act under Central Act No XXXI of 1950 had already ceased because the property had become part of the compensation pool. Accordingly, the Court held that the October 1955 order must be set aside and that no further proceedings could be taken under it. The Court accordingly made an order to that effect and directed that the appellants would receive their costs.

The judgment directed that the appellants should be awarded their costs in the proceedings. In addition, the judgment explicitly stated that it did not express any view on the dispute that existed between the appellants and the interveners. By making this clarification, the judgment indicated that the adjudicating authority refrained from taking a position on the merits of the controversy that had arisen between the two sides. Consequently, the parties who were involved in the disagreement were left to pursue whatever legal remedies might be available to them under the applicable law. The order therefore combined an award of costs to the appellants with a clear disclaimer that the court’s decision did not resolve, comment upon, or otherwise influence the underlying conflict between the appellants and the interveners. The interveners, as well as the appellants, were thereby free to approach other legal forums or to institute further proceedings if they chose to do so, in accordance with the procedural and substantive rules governing such matters. The declaration that no opinion was offered on the controversy was intended to delineate the scope of the judgment, limiting its effect to the cost award and leaving the substantive dispute untouched for resolution through other appropriate legal channels.