1. Dispute over rights to collect forest produce under agreements with former proprietors after the State vested proprietary rights under the Madhya Pradesh Abolition of Proprietary Rights Act 1950. (Para 2 )
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1959 Supreme(SC) 30
SUPREME COURT OF INDIA
9th March 1959
S.R. DAS, C.J.I., S.K. DAS, P.B. GAJENDRAGADKAR, K.N. WANCHOO AND M. HIDAYATULLAH, JJ.
l. Mahadeo (In Petn. No. 26 of 54), 2. Seth Bansidhar (In Petn. No. 27 of 54), 3. Amarsibhai (In Petn. No. 24 of 55), 4. Sambashiv (In Petn. No. 437 of 55), 5. Firm Habib Ahmed Brothers (In Petn. No. 256 of 56), 6. Hirjibhai (In Petn. No. 12 of 57), 7. Firm S. Pratap & Co. (In petn. No. 16 of 57), 8. Kumar S. Pratap Singh & Co. (In Petn. No. 17 of 57) and 9. R. M. Chandrapal Singh Rana (In Petn. No. 73 of 1957) Petitioners
Versus
1. The State of Bombay (In Petns. Nos. 26 and 27 of 54, 24 and 437 of 55 and 256 of 1956), 2. The State of M.P. (In Petns. Nos. 16, 17 and 73 of 1957) and 3. Divisional Forest Officer, East Chanda and another (In Petn. No. 12 of 1957), Respondents.
Petitions Nos. 26 and 27 of 1954 24 and 437 of 1955, 256 of 1956, 12, 16, 17 and 73 of 1957.
Advocates appeared
Mr. M. S. K. Sastri Advocate, for Petitioners in Petns. Nos. 26 & 27 of 54 & 24 of 1955); M/s. V. N. Swami and M. S. K. Sastri, Advocates, for Petitioners (in Petns. Nos. 437 of 55 and 156 of 56); Mr. L. K. Jha, Senior Advocate (Mr. J. M. Thakur; Advocate and M/s. S. N. Andley and J. B. Dadachanji, Advocates of M/s. Rajinder Narain & Co. with him), for Petitioner (in Petn. No. 12 of 57); Mr. N. S. Bindra, Sr. Advocate (Mr. Harbans Singh, Advocate, with him), for Petitioners (in Petns. Nos. 16 and 17 of 1957); Mr. N. S. Bindra. Senior Advocate (Mr. Govind Saran Singh, Advocate with him), for Petitioner (in Petn. No. 73 of 1957); Mr. H. N. Sanyal, Addl. Solicitor General of India (M/s. H. J. Umrigar and R. H. Dhebar, Advocates, with him) for Respondent (in Petitions Nos. 26 and 27 of 54, 24 & 437 of 55; 256 of 56 and 12 of 57); Mr. M. Adhikary, Advocate General for State of Madhya Pradesh (Mr. I. N. Shroff, Advocate with him) for Respondent (in Petns. Nos. 16, 17 and 73 of 57). 737
Advocates:
GOVIND SARAN, H.J.Umrigar, H.N.SANYAL, HARBANS SINGH, J.B.DADACHAN, J.M.THAKAR, J.N.Shroff, L.K.JHA, M.ADHIKARI, M.S.K.Shastri, N.S.BINDRA, R.H.Dhebar, RAJINDAR NARAIN, S.N.ANDLEY, V.N.SVAMI
GOVIND SARAN, H.J.Umrigar, H.N.SANYAL, HARBANS SINGH, J.B.DADACHAN, J.M.THAKAR, J.N.Shroff, L.K.JHA, M.ADHIKARI, M.S.K.Shastri, N.S.BINDRA, R.H.Dhebar, RAJINDAR NARAIN, S.N.ANDLEY, V.N.SVAMI
Rights to collect forest produce, when coupled with rights to occupy land and manage trees, constitute proprietary interests in land. Such interests vest in the State upon the abolition of proprietary rights, regardless of whether they were previously transferred to third parties.
Headnote:(A) Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act 1950 - Sections 3, 4 and 6; Central Provinces Land Revenue Act, 1917 - Sections 2, 47 and 202 - Right to take forest produce - Nature of right - Proprietary interest vs. License.
(B) Registration - If a right is claimed on the basis of an unregistered agreement, it cannot be entertained if the document confers a part or share in the proprietary right or a right to profit a prendre (Para 7).
(C) Nature of Right - A right to take produce of the soil, especially when combined with rights to occupy land, erect buildings, and manage forest growth, is an interest in land (profit a prendre) and not a mere contract for the sale of goods (Paras 14, 18).
(D) Vesting of Rights - Proprietary rights in forests and trees are items of proprietary rights; therefore, any such interest transferred by a proprietor vests in the State under the relevant abolition legislation (Paras 27, 28).
Facts of the case:
Petitioners entered into agreements with former proprietors for the right to collect forest produce, primarily tendu leaves. Some agreements were registered, some unregistered, and some had expired. The State disclaimed these agreements and auctioned the rights, leading the petitioners to claim a violation of fundamental rights under Article 32 of the Constitution.
Findings of Court:
The court found that the agreements were not mere licenses or sales of goods but created an interest in land. Consequently, these proprietary interests vested in the State upon the abolition of proprietary rights.
Issues: Whether the rights to collect forest produce and occupy land granted by former proprietors constitute "proprietary rights" that vest in the State under the abolition act, or whether they are mere contractual licenses for the sale of goods.
Ratio Decidendi: The court reasoned that since the agreements included rights to occupy land, build structures, and manage forest growth over long periods, they were interests in land. As forests and trees are items of proprietary rights, any such interest transferred by a proprietor vests in the State under Sections 3 and 4 of the Act.
Result: Petitions dismissed.
Legal Category Hierarchy
- constitutional law
- property law
- contract law
Table of Contents
2. Petitioners contend agreements are licenses for sale of goods, not proprietary rights, and thus not affected by the vesting of proprietary rights in the State. (Para 6 , 11 )
3. Agreements granting rights to occupy land, build structures, and take various forest produce constitute an interest in land rather than mere contractual licenses or sale of goods. (Para 7 , 10 , 14 , 18 , 22 , 23 , 24 , 25 , 26 , 27 )
4. Rights to forest produce and land use granted by proprietors are proprietary interests that vest in the State free of encumbrances under the Abolition of Proprietary Rights Act. (Para 19 , 20 , 28 )
5. Petitions dismissed. (Para 30 )
6. Does an agreement granting a right to profit a prendre or a share in proprietary rights require registration?
Yes, if a right is claimed based on an unregistered agreement that confers a part or share in proprietary rights or a right to profit a prendre, it cannot be entertained. (Para 7 )
7. When does an agreement for forest produce constitute a proprietary interest rather than a mere license or sale of goods?
When the agreement includes benefits beyond taking produce, such as rights to occupy land, erect buildings, and take various forest produce over a long term, it constitutes an interest in land. (Para 14 , 18 )
8. What happens to interests in proprietary rights held by third parties through a proprietor upon the vesting of rights in the State?
All proprietary rights, including those held by any person having an interest in such proprietary rights through the proprietor, cease and vest in the State free of all encumbrances. (Para 19 , 20 , 28 )
Judgment
M. HIDAYATULLAH J.: The judgment in Petition No. 12 of 1957 shall also dispose of Petitions Nos. 26 and 27 of 1954, 24 and 437 of 1955, 256 of 1956 and 16, 17 and 73 of 1957.
2. These petitions under Art. 32 arise out of alleged agreements by which some of the proprietors in the former State of Madhya Pradesh granted to one or other of the petitioners the right to take forest produce, mainly tendu leaves, from the forests included in Zamindari and Malguzari villages of the grantors. Government has disclaimed these agreements and auctioned the rights afresh. The petitioners state that this is an invasion of their fundamental rights. The dates on which these alleged agreements were entered into the terms therefor and the periods during which they were to subsist are different from case to case. It is not necessary in this judgment to recite the terms of these documents, and it is sufficient to group them for purpose of decision on the basis whether the said agreements still subsist, and whether they are incorporated in a registered instrument or not.
3. Petitions Nos. 437 of 1955 and 256 of 1956 are founded on unregistered documents. The answering respondent does not admit these documents, and contends that they cannot be looked into to prove their terms, in view of the decision of this Court in Shantabai v. State of Bombay , AIR 1958 SC 532.
4. Petitions Nos. 16, 17 & 73 of 1957 from another group, inasmuch as the period during which the alleged agreements were to operate expired in 1955. Additionally, the documents on which the claim is founded in those petitions are unregistered. In the last mentioned ease, it is pleaded that the answering State Government had recognised the agreements in favour of the petitioner but resiled from that position subsequently, which allegation has been adequately explained by the State Government in its, affidavit. The recognition was not in favour of the petitioner but in favour of one Thakur Kamat Singh, who claimed under an agreement entered into by one Viswanath Singh on a date when he had already transferred his interest in the Zamindari to his son, Onkar Prasad Singh. This point was therefore not taken before us at the hearing, and nothing mare need be said about it. The main objection against these petitions is that the agreements having expired, there is nothing left to enforce either in favour of the petitioners or against the State Government, and the remedy, if any, of the, petitioners is to sue the State and/or the proprietors for the breach.
5. The last group consists of Petitions Nos. 26 and 27 of 1954, 24 of 1955 and the present petition (No. 12 of 1957) In these petitions, the agreements with the petitioners are made by registered documents, and the terms during which they are to operate have yet to expire. These cases, it is stated, fall outside the rule in Shantabai s case, AlR 1958 SC 532, to which reference has already been made. They are stated to fall within the decision of this Court reported in Firm Chhotabhai Jethabai Patel and Co. v. State of Madhya Pradesh , 1953 SCR 476 at pages 480, 481, 483;,(AIR 1953 Sec108 at pages 109, 110. In all these petitions, counsel argue that the view expressed in the last mentioned case is correct, while the view in Shantabai s case, AlR 1958 SC 532 needs further considerations.
6. The argument of the petitioners in these several cases is that Government steps into the shoes of the quondam proprietors, and is bound by the agreements into which the latter had entered before their proprietary rights were taken over by Government. They also raise the contention that the petitioners were not proprietors as defined in the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act 1950 (hereinafter called the Act), and thus Ss. 3 and 4 in terms do not apply to them. These sections, it is contended, do not apply to profit a prendre, which the petitioners enjoy under these agreements. In support of this contention,
