Jambu Rao Satappa Kocheri v. Neminath Appayya Hanammannaver

Sllah, J. The appellant agreed to sell to the respondent Sur­ vey Nos. 5 & 12 of village Pattihal in District Belgaum, Mysore State, admeasuring 41 acres 26 gunthas of jirayat land for Rs. 32,000/-. The appellant having failed to execute a conveyance of the land, the respondent commenced an action in the Court of D the Civil Judge, Senior Division, Belgaum, for a decree for specific performance of the agreement and for possession of the land. The trial court dismissed the suit holding that the agree­ ment, if enforced, would result in "transgression of the provisions of the Bombay Tenancy and Agricultural Lands Act, 1948". Jn appeal, the High Court of Mysore granted a decree for specific E performance. With certificate granted by the High Court, this appeal has been preferred by the appellant. The trial court and the High Court have concurrently found that the appellant failed to prove that the contract was abandoned by mutual agreement, and nothing more need be said about the plea raised by the appellant. Two questions survive for decision F in this appeal ; (I) Whether enforcement of the contract would re­ sult in transgression of the provisions of the Bombay Tenancy and Agricultural Lands Act, 1948; and (2) Whether the civil court had jurisdiction to enter­ tain the suit for specific performance. By s. 5 of. the Bombay Tenancy and Agricultural Lands Act 67 of 1948, as 1t stood at the relevant time, it was provided ; "(l) For the purj,oses of this Act, the ceiling area of land shall be- (a) 48 acres of Jirayat land, or . (b) 24 acres of seasonally irrigated land or paddy or nee land, or (c) l2 acres of perennially irrigated land. 708 SUPllKB <X>tD.T IBPOJl.TS [1!168) 3 S.C.R. (2) Where the land held by a person consists of two or more kinds of land specified in sub-section (1), the ceiling area of sll4iji holding shall be determined on the basis of one acre of perennially irrigated land being equal to two acres of seasonally irrigated land or paddy or rice land, or four acres of j1'rayat land." _Section 34(1) of the Act provided: "Subject to the provisions of section 35, it shall not be lawful, with effect from the appointed day, for any person to hold, whether as OWllflr or tenant or partly as owner and partly as tenant, Jana in excess of the ceiling area." The expression "to hold land" is not defined in the Tenancy Act. It is defined in the Land Revenue Code, and by virtue of s. 2(21) of the Tenancy Act it has the same meaning which it has under the Bombay Land Revenue Code, 1879, i.e., "t() be lawfully in possession of land, whether such possession is actual or not" : s. 3(11) of the Bombay Land Revenue Code, 1879. Section 35 provided that : "Where on account of gift, purchase, assignment, lease, surrender or any other kind of transfer inter vivos or by bequest except in favour of recognised heirs and land comes into the possession of any person and in consequence thereof, the total land held by such person exceeds the area, which he is authorised to hold under section 34, the acquisition of such excess land shall be invalid. Explanation. " .• The material part of s. 84C provided : "(1) Where in respect of the transfer of acquisition of any land made on or after the commencement of the Amending Act, 1955, the Mamlatdar suo motu or on the application of any person interested in such land has reason to believe that such transfer or acquisition is or becomes invalid under any of the \)OOvisions of this. Act, the Mamlatdar shall issue a notice and hold an inquiry as provided for in section 84B and decide whether the transfer or acquisition is or is not invalid. (2) If after holding such inquiry, the Mamlatdar comes to a conclusion that the transfer or acquisition of land is invalid, he shall make an order dec!aring the transfer or acqllisition to be invalid. (3) On the declaration made by the Mamlatdar under sub-section (1) ,- JAMBU RAO v. NBMINATH (Shah,/.) 70& A "(a) the land shall be deemed to vest in the State 'B Government, free from all encumbrances lawfully sub­ sisting thereon on the date of such vesting, and shall be disposed of in the manner provided in sub-section (4); .. The appellant resisted the claim of the respondent for specific performance of the agreement of sale on the plea that the res­ pondent was already holding 31 acres 2 gunthas of jirayat land, and by acquiring 41 acres 26 gunthas of jirayat land, the respondent's holding would exceed the ceiling prescribed by the statute. The evidence on the record about the area of lands held by the respondent at the relevant time is obscure. The agreement was dated July 20, 1958. On April 1, 1960 the respondent filed a statement in the Court that, barring lands which were li­ able to be excluded in determining whether the holding exceed­ ed the ceiling, he was in possession of 11 acres 1 guntha of jirayat land. If that holding were to be taken into account, and if in pursuance of a decreee for specific performance the respon­ dent acquired possession of the land agreed to be sold, his total holding would exceed the ceiling. In the trial court the parties proceeded to trial on the footing that if the agreement was en­ forced specifically, the holding of the respondent would exceed the ceiling area. In appeal, the High Court observed that there was no evidence that the respondent was a holder of land in excess of the ceiling area on the date of the agreement nor was there evidence to show that he was holding an area of land in excess of the ceiling area on the date of the suit or even at the date of the statement dated April 1, 1960. and therefore s. 34 had no relevance. The High Court observed in the last paragraph of the judgment that they had not recorded any finding about the actual area of jirayat land in the possession of the respondent at any point of time either on the date of the suit or on April 1, 1960, and the question was left open as desired by the parties, Since in the trial court the parties chose to go to the trial on the footing that if the contract is specifically enforced, having re­ gard to the holding of the respondent, the total area would ex­ ceed the ceiling, we proceed to decide the appeal on that foot­ ing. By s. 23 of the Contract Act, consideration or object of an agreement i~ unlawful if it is forbidden by law; or is of such a nature that, if permitted, it would defeat the provisions of any law; or is fraudulent. Both the parties to the contract are agri­ culturists. By the agreement the appellant agreed to sell jirayar 710 SUPREME COURT Rll'PORTS (1968) 3 S.C.R. A . land admeasuring 4lacres 26 guntllilS for a price of .Rs. 32,000/-. The consideration of the agreement per "se was not unlawful, for there is no provision in the Act which expressly or by implica­ tion forbids a contract for sale of agricultural.lands between two agriculturists. Nor is the object of the agreement to defeat the provisions of any law. The Act has imposed no restriction upon the transfer of agricultural lands from one agriculturist to another. It is true that by s. 35 a person who comes to hold, -after the appointed day, agricultural land in excess of the ceiling, the lands having been acquired either by purchase, assignment, lease, sur­ render or by beg_uest, the acquisition in excess of the ceiling is invalid. The expression "acquisition of such excess land shall be invalid" may appear somewhat ambiguous. But when the scheme of the Act is examined, it is clear that the Legislature has not declared the transfer or bequest invalid, for s. 84C provides that the land in excess of the ceiling shall be at the disposal of the Government when an order is made by the Mamlatdar. The in­ validity of the acquisition is therefore only to the extent to which the holding exceeds the ceiling prescribed by s. 5, and involves the consequence that the land will vest in the Government. i By the acquisition declared invalid under s. 35, the land does not revert to the transferor or the testator; the land is deemed to be of the ownership of the person acquiring it by transfer or by bequest and~on the Mamlatdar making the order, the land in excess of the ceiling vests in the Government. It only will mean that the purchaser will not be entitled ta hold the land in excess . E of the ceiling and the excess will be at the disposal of the Govern­ ment. An agreement to sell land does not under the Transfer of Property Act create any interest in the land in the purchaser. By agreeing to purchase la'nd, a person cannot be said in law to hold that land. It is Ol)ly when land is conveyed to the purchaser that he holds that land. Undoubtedly the respondent was hold­ ing some area of land at the date of the agreement and at the date of the suit, but on that account it cannot be inferred that by agreeing to purchase \and under the agreement in question his object was to hold in excess of the ceiling. It was open to the respondent to transfer or dispose of the land held by him to an­ other agriculturist. The Act cont~ins no general restrictions upon such transfers, and unless at the date of the acquisition the trans­ feree holds land in excess . of the ceiling, the acquisition to the extent of the excess over the ceiling will' not be invalid. There is nothing in the agreement, nor can it ·be implied from the cir­ cumstances, that it was the object of the parties that the provi­ sions of the Act relating to the ceiling should be transgressed. The mere possibility that the respondent may not have disposed of his original holding at the date of the acquisition of title pur: J,A.MBU RAO v. NEMINATH (Shah, J.) 711 suant to the agreement entered into between hinl and the appel­ lant will •not, in our judgmeut, render the object of the agree­ ment such, that, if permitted, • it would defeat the provisions of any law. The Court, it is true, will not enforce a contract which is expressly or inlpliedly prohibited by statute, whatever may be the intention of the parties, but there is nothing to indi­ cate .that the Legislature has prohibited a contract to transfer land betv<een one 11griculturist and another. The inability of the transferee to hold land in excess of the ceiling prescribed by the statute; has no effect upon the contract, or the operation of the transfer. The statutory forfeiture incurred in the event of the transferee coming to hold land in excess of the ceiling does not invalidate the transfer between the parties. We hold that a oontract for purchase of land entered into with the knowledge that the purchaser may hold land in excess of the ceiling is not void, and the seller callilot resist enforce­ ment thereof on the ground that, if pennitted, it will result in transgression of the law. There is no substance in the argument that the civil court had no jurisdiction to entertain and decree a suit for specific perform­ ance of an agreement tq sell land. Section 70 of the Act sets out the duties and functions of the Mamlatdar and, amongst the duties and functions which the Mamlatdar for the purpose of the Act shall discharge or perform is the duty and function to decide under s. 84C whether a transfer or acquisition of land is invalid and to dispose of the land as provided in s. 84C .. Section 85 of the Act excludes from the jurisdiction of the civil court proceed­ ings to settle, decide or deal with questions which are required by s. 70 (mb) to be settled, decided or dealt with by the authori­ ties specified in that behalf. Power to decide whether the transfer or acquisition is invalid under s. 84C and to dispose· of the land as provided in that section is undoubtedly conferred upon the Mamlatdar, and the civil court has .no jurisdiction in that behalf. But there is nothing in cl. (mb) of s. 70 which excludes the jurisdiction of the civil cdurt to entertain a suit for specific per­ formance of a contract to sell land. An inquiry under s. 84C to determine whether the transfer or acquisition is invalid m'y be made only after the acquisitjon of title pursuant to a decree for specific perfonnlince or otherwise. The civil court has no juris• diction to detennine whether the acquisition is invalid, but there is nothing in s. 70 or in other provisions of the Act which excludes the civil court's jurisdiction to decree specific perfonnance of a contract to transfer land. The apPeal therefore fails and is dismissed with costs. R.K.P.S. Appeal dismissM. 8SupC1/68-6