1. Inheritance of agricultural land — transfer of interest to third party — claim of preferential right to acquire said interest under Section 22, Hindu Succession Act, 1956. (Para 2 , 3 )
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2019 Supreme(SC) 313
SUPREME COURT OF INDIA
UDAY UMESH LALIT, M.R. SHAH, JJ.
Babu Ram – Appellant
Versus
Santokh Singh (deceased) through his LRs and others – Respondents
Civil Appeal No. 2553 of 2019, (Arising out of Special Leave Petition (Civil) No.31039 of 2018)
Decided On : 07-03-2019
Important Points
IMPORTANT POINT
In absence of State law as regards devolution of tenancy rights in respect of agricultural holdings, provisions of section 22 for succession of agricultural land would apply to devolution of tenancy rights also.
In absence of State law as regards devolution of tenancy rights in respect of agricultural holdings, provisions of section 22 for succession of agricultural land would apply to devolution of tenancy rights also.
Subject
Property Law - SUCCESSION
Act Referred
Headnote
(a) Hindu Succession Act, 1956 – Section 22 – Absence of State law as regards devolution of tenancy rights in respect of agricultural holdings – Provisions of section 22 for succession of agricultural land – Would apply to devolution of tenancy rights also. (Para 16, 17)
R.S.A. No. 258 of 2012; AIR 1957 Orissa 1 : 22 (1956) CLT 466; 1970 PLJ 587 : 1970 Punjab Law Reporter Vol. 72 page No.958; AIR 1970 Allahabad 238 – Cited with approval
AIR 1994 Bombay 247 : (1994) 96 Bombay Law Reporter 227; (1999) 1 SCC 292 – Referred
(1941) 3 FCR 12 : AIR 1941 FC 72; AIR 1960 Punjab 666 – Overruled
(b) Hindu Succession Act, 1956 – Section 22 – Inherited property – Source of title flowing from section 22 – Right to transfer by one heir – Other heirs have preferential right – Held, preferential right given to an heir of a Hindu u/s 22 applicable even in case of agricultural land. (Para 19, 20, 21)
Facts of the case:
Two brothers, namely, Santokh Singh (Original Plaintiff) and Nathu Ram, (Original Defendant No.1) sons of Lajpat S/o Rupa inherited, among others, certain agricultural lands after the death of their father. Nathu Ram being not interested in continuing with the family arrangement for sharing of land, gave a legal notice to Santokh Singh and later executed a registered sale deed in respect of his interest in the lands in favour of one Babu Ram(Original Defendant No.2) S/o Kanshi Ram.
Soon thereafter a civil suit was filed by Santokh Singh praying for permanent prohibitory injunction and declaration. The trial court dismissed said suit.
The appeal thereagainst was partly allowed.
The High Court dismissed said Second Appeal filed by defendant no. 2.
Finding of the Court:
The High Court was right in affirming the judgment and decree passed by the Court of District Judge.
Result: Appeal dismissed.
Legal Category Hierarchy
Table of Contents
2. Whether the preferential right provided under Section 22 of the Hindu Succession Act, 1956, is inapplicable when the property in question is agricultural land. (Para 2 , 4 )
3. Analysis of legislative competence under the Constitution — distinction between inter vivos transfer of agricultural land and succession by operation of law. (Para 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 , 17 , 18 , 19 , 20 )
4. Preferential right under Section 22 of the Hindu Succession Act, 1956, applies to agricultural land as succession is a concurrent subject under the Constitution. (Para 15 , 16 , 21 )
5. Appeal dismissed — judgment and decree of the lower court affirmed. (Para 21 , 22 )
6. Does the preferential right to acquire property under Section 22 of the Hindu Succession Act, 1956, apply to agricultural land?
Yes. The court held that the preferential right is applicable to agricultural land because intestacy and succession are covered under Entry 5 of List III of the Constitution of India without excluding agricultural land. (Para 15 , 16 , 21 )
7. What is the distinction between legislative competence regarding the transfer of agricultural land versus its succession?
Transfer and alienation of agricultural land (inter vivos) fall under the exclusive competence of State legislatures (Entry 18, List II), whereas intestacy and succession (transfers by operation of law) fall under the Concurrent List (Entry 5, List III). (Para 15 )
8. How does the omission of Section 4(2) of the Hindu Succession Act affect the applicability of Section 22 to agricultural holdings?
Previously, Section 4(2) excluded the Act's application to the devolution of tenancy rights in agricultural holdings. Following its deletion, there is no longer an exception to the applicability of Section 22 in such cases. (Para 17 )
9. Why is the preferential right under Section 22 considered an integral part of the law of succession?
Because the right is tied to the source of title; since the interest is conferred through succession under the Act, the manner in which that right is exercised is specified within the same legislation to keep family properties within the family. (Para 19 , 20 )
JUDGMENT :
UDAY UMESH LALIT, J.
1. Leave granted.
2. This appeal arises out of final judgment and order dated 07.05.2018 passed by the High Court (High Court of Himachal Pradesh at Shimla) in Regular Second Appeal No.457 of 2002 and raises questions regarding scope and applicability of Section 22 of the Hindu Succession Act, 1956 (hereinafter referred to as the Act), and particularly, whether preferential right given to an heir of a Hindu under said Section 22 will be inapplicable if the property in question is an agricultural land.
3. The facts leading to the filing of this appeal, in brief, are as under:
(a) Two brothers, namely, Santokh Singh (Original Plaintiff) and Nathu Ram, (Original Defendant No.1) sons of Lajpat S/o Rupa inherited, among others, certain agricultural lands after the death of their father. According to Santokh Singh an arrangement was arrived at, in terms of which the brothers were to be in separate enjoyment of certain specified pieces of land. Since Nathu Ram was not interested in continuing with said arrangement he gave a legal notice to Santokh Singh and later executed a registered sale deed on 19.08.1991 in respect of his interest in the lands in favour of one Babu Ram(Original Defendant No.2) S/o Kanshi Ram.
(b) Soon thereafter, Civil Suit No.194 of 1991 was filed by Santokh Singh in the Court of Senior Sub-Judge, Hamirpur praying for permanent prohibitory injunction and declaration. It was inter alia submitted that as a co-sharer, the Plaintiff had a preferential right to acquire the land which was sought to be transferred by Defendant No.1 in favour of Defendant No.2. The suit was contested and the trial court by its judgment and order dated 04.05.1994 dismissed said suit.
(c) The Plaintiff, being aggrieved filed Civil Appeal No.86 of 1994 in the Court of District Judge, Hamirpur, which appeal was partly allowed. The Appellate Court placed reliance on the decisions reported in AIR 2000 Madras 516 and AIR 1988 Orissa 285 and held that the Plaintiff had a preferential right under Section 22 of the Act to acquire the suit land measuring 19 kanals half of the entire land entered in Khata No.25 min, Khatoni No.29 min, Khasra No.1119 measuring 38 kanals 1 marla situated in Tika Badehra, Tappa Badohag, Tehsil Nadaun, District Hamirpur, (H.P.) on payment of sale consideration amounting to Rs.60,000/-. It also held the transfer of suit land by Defendant No.1 in favour of Defendant No.2 to be illegal, null and void and hit by the provisions of Section 22 of the Act. It directed Defendant No.2 to transfer the suit land in the name of the Plaintiff on receipt of sale consideration amounting to Rs.60,000/- within three months.
(d) Defendant No.2, being aggrieved, carried the matter further by filing Regular Second Appeal No.457 of 2002 in the High Court, which inter alia framed following substantial question of law:
“1. Whether Section 22 of the Hindu Succession Act excludes interest in agricultural land of an intestate and the preferential right over “immovable property” as envisaged in the said provision is confined only to business and such immovable property which does not include the agricultural land?”
(e) Relying principally on the decision of the Division Bench of the High Court in RSA No.258 of 2012 (Roshan Lal vs. Pritam Singh and others, R.S.A. No. 258 of 2012 decided on 1.3.2018), the High Court dismissed said Second Appeal, which decision is presently under challenge by Defendant No.2-Appellant.
4. The challenge before this Court is confined to the applicability of Section 22 of the Act to agricultural lands and the factual facets of the matter are not in dispute. We have heard Mr. Sanchar Anand, learned Advocate for the Appellant and Mr. Ranjan Mukherjee, learned Advocate for heirs of Respondent No.1 – Plaintiff. With the assistance of the learned Counsel we have considered all the relevant decisions on the point.
5. On a reference made under Section 213 of the Government of India Act, 1935 (hereinafter
