JUDGMENT

S. Saghir Ahmad, J.-Leave granted.

2. On 21.10.1961, each of the respondents was allotted an area of 7.06. acres of Government land situated in village Manchirevula, District Rangareddy, situated at a distance of about 10 miles from the city of Hyderabad in Andhra Pradesh. This assignment was subject to two conditions, namely, (i) that the land would be used only for cultivation and (ii) that it would not be alienated regarding which each one of the assignees had given a written undertaking that they would not sell the land under any circumstance without the prior sanction of the Tehsildar and in case the land was sold, it would revert back to the Government. (Learned Senior Counsel, Mr. M.N. Rao and Mr. Sudhir Chandra object to this undertaking being read by us on the ground that this was not filed before the High Court).

3. In exercise of the power conferred by Section 172 of the Andhra Pradesh (Telangana Area) Land Revenue Act, 1317 F., the Government had made THE LAONI RULES, 1950 of which Rule 19 is quoted below :-

"19. The allottee of the land shall prepare the land for cultivation within three years of being placed in possession and commence cultivation of the land thereafter. The pattadar may be rejected by the order of the Collector for breach of any of the above conditions:

Provided that he has been served with a notice calling upon him to comply with the conditions which he has violated and he fails to comply with it within three months of the date of service thereof. If land has been transferred in contravention of the conditions, the Collector may eject the transferee."

(Emphasis supplied)

4. Permission to occupy the Government land is given on the prescribed Form G . One of the conditions contained in Form G is that the "grantee is not empowered to transfer the occupancy without the sanction previously obtained from the Collector".

5. Under the Revised Assessment Policy, published in Part II of Andhra Pradesh Gazette dated 31.7.1958 (pages 771-773), which again was made in exercise of the powers conferred by Section 172 of the Andhra Pradesh (Telangana Area) Land Revenue Act, 1317 F., it was provided in Part VI thereof as under:-

" VI. Terms and conditions of assignment:-

(i) the assignment of lands shall be free of market value;

(ii) lands assigned shall be heritable but not alienable;

(iii) lands assigned shall be brought under cultivation within three years;

(vi) no land tax shall be collected for the first three years except for the extent if any, which has already been brought under cultivation. Water rate shall, however, be charged if the lands are irrigated with Government water; and

(v) cultivation should be by the assignee or the members of his family or with hired labour under the supervision of himself or a member of his family."

6. Thus, under the original Laoni Rules, 1950 as also under the Revised Policy published in 1958, the alienation of the assigned land was prohibited. While under the Laoni Rules, 1950 the alienation or transfer without the previous sanction of the Collector was prohibited, under the Revised Policy, it was clearly provided that though the assigned lands would be heritable, they would not be transferred.

7. On 14th of August, 1991, the respondent to whom the land was assigned, executed a Power of Attorney in favour of a builder, M.A. Baksh, giving him, inter alia, the following powers :-

"5. To negotiate, enter into agreements for and/or lease or licence the said property or any portion thereof to such person(s) or body and for such consideration and upon such terms and conditions and for such purpose (s) as my said attorney may in his absolute discretion deem fit.

6. To negotiate and agree to and/or to enter into agreement, to sell/develop/lease/mortgage the said property or to sell, convey, lease mortgage, assign or to otherwise transfer the said property or any portion thereof such person(