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SUPREME COURT OF INDIA
A.N.Grover : J.C.Shah : V.Ramaswami
R.V.M.Neeladri Rao
Versus
Board Of Revenue
Case No. : 1648 of 1966
Date of Decision : 9/23/69
Advocates Appeared: Nair A.V.Velayudhan : Nawanju D. : Rangam A.V. : Rao A.Subba : Reddy P.Ram
Constitution of India, 1950 - Article 226 - Madras Estate (Abolition and Conversion into Ryotwari) Act, 1948 - Section 55, 55(1), 20, 20(2), 22, 3, 3(4), 67, 3(i) (f)and (11) - Andhra Pradesh Estates (Abolition and Conversion into Ryotwari) Act, 1948 - Andhra Pradesh Estates Land (Reduc- tion of Rent) Act, 1947 - Interest Act, 1839 - Lands - Transferred Lease - Payment of Proportionate Share of Compensation - Whether land-holder or a ryot who became entitled to ryotwari patta was liable to pay to government - Whether rent that could be collected from lease-hold land would fall within con- notation of land revenue payable to government – Held, Its considered opinion was that rent payable to land-holder fell outside range of Section 22 - Therefore only rent as fixed under Act XXX of 1947, in three preceding years could be taken into account - Its must be remembered that settlement -Rates represent what is payable to government as revenue in respect of land granted on patta by government in ryotwari settlement - They do not represent what is due to persons like appellants from their tenants – Court consider that it is not possible to equate rents payable by tenants to appellants with land revenue payable to government - No exception could thus be taken to manner and measure of computing compensation - Appellants are entitled to interest on amount of unpaid rents in hands of government for period 1950 to 1961 as under Section 55 of Act after notified date land-holder is not entitled to collect any rent which accrued due to him from any ryot before and is outstanding on that date - It is manager appointed under Section 6 who alone would be entitled to collect said amounts together with interest - Amounts were collected but no payment was made to appellants - It was held that company was entitled to interest on balance at 4% per annum - Reference was made in this case to a number of English and Indian decisions in which rule has been laid down that though under statute there is no provision for payment of interest it should, nevertheless, be awarded, principle being that if owner of an immovable property loses possession of it he is entitled to claim interest in place of right to retain possession - It may be mentioned that even under Interest Act, 1839, power to award interest on equitable grounds was expressly saved by proviso to 5% - In Court opinion this position has not been seriously controverted on behalf of respondents that appellants should have been held entitled to interest at rate of 6% per annum - In result appeal is allowed only to extent that it is declared that appellants should have been paid interest at rate of 6% per annum on amount of rents collected by manager on behalf of government and final figure of compensation should have been determined after taking into account amount of interest which accrued due to such of appellants as were entitled to it - Appeal allowed.
A.N.GROVER, J.
(1) THIS is an appeal by certificate from a judgment of the Andhra Pradesh High court given in a petition filed under Article 226 of the Constitution by the appellants.
(2) THE facts may be stated. The previous Maharajah of the impartible estate of Pithapuram in East Godavari District granted a lease on June 22, 1887, in favour of his third wife late Rani Subbayyamma Bahadur in respect of lands in various villages covering an area of acres 2669.65 cents. The Rani executed a will on 8/11/1914, bequeathing all her property including the lease-hold rights to the first appellant and on her death he succeeded to her estate. On 10/12/1956, the first appellant transferred his lease- hold rights in acres 2519.63 cents to the second appellant and reserved to himself the rights in and over the remaining area of acres 150.52 cents. The third appellant is an assignee from the second appellant.
(3) ON the enactment of the Madras Estate (Abolition and Conversion into Ryotwari) (Act XXVI of 1948), hereinafter called the Act, the title of which was changed to the Andhra Pradesh (Andhra Area) Estates (Abolition and Conversion into Ryotwari) Act, 1948 (Act XXVI of 1948), the Pith- apuram Estate was notified and abolished with effect from 7/09/1949. The lands in question were taken over by the government under the provisions of the Act and the Manager who had been appointed ordered that the rent should be collected direct from the tenants in possession of the lease- hold lands under Section 55(1) of the Act from the fasli year 1357 onwards on the reduced rates notified under the Madras Estates Land (Reduction of Rent) Act, later called Andhra Pradesh (Andhra Area) Estates Land (Reduc- tion of Rent) Act (Act XXX of 1947). The first appellant filed a petition before the Estates Abolition tribunal, Vizianagram, for payment of the propor- tionate share of compensation out of compensation payable for the estate of Pithapuram. That petition was opposed by the government and the principal land-holder, according to whom, the claim of the first appellant was governed by Section 20 of the Act. This objection was upheld by the tribunal. On 8/01/1959, the High court confirmed the order of the tribunal in appeal holding that the first appellants rights were covered by Section 20 of the Act. In March, 1960, the appellants filed a petition under Article 226 of the Constitution praying for various reliefs. On 9/09/1960, the government decided that as the lease was covered by Section 20 of the Act the Board of Revenue be asked to terminate the same and to pay all the amounts collected as also the compensation payable under Section 20 to the appellants. On 17/09/1960, the Board of Revenue issued a notice to the appellants calling upon them to show cause as to why the lease-hold rights in respect of acres 2669.65 cents should not be terminated. The appel- lants sent; a reply on 17/10/1960, representing that they had no objec- tion to the termination of the lease provided the government paid compensa- tion to the appellants together with all the amounts so for collected by the government from the lease-hold lands without deducting any collection charges together with interest accruing thereon till the date of the payment. On 17/11/1960, the Board formally terminated the lease and inform- ed the appellants that compensation and all the amounts collected from the lease-hold lands would be paid to them after deducting cist at 4 annas per acre and cesses etc., but that no interest would be paid on the amounts collected by the government and further that the government was also entitled to deduct the collection charges. On 25/01/1961, the Board made an order directing that the appellants should be paid a sum of Rs. 24,949.20 which was stated to be the net. collection made by the government on the lease-hold lands after deducting the cist at 4 annas per acre, cesses at 50% of. the total cesses payable and collection char
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