The Collector's jurisdiction to grant an exemption certificate under section 88B of the Tenancy Act is limited to cases where the land in question belongs to the trust. If the transfer of land to the trust is initially invalid under sections 63 and 64 of the Tenancy Act, the Collector lacks jurisdiction to grant the exemption certificate, and the certificate cannot validate the transfer.

Headnote:
TENANCY ACT - SECTIONS 63, 64, 84A, 84C, 88B - TRANSFER OF LAND TO NON-AGRICULTURIST TRUST - VALIDITY - EXEMPTION CERTIFICATE UNDER SECTION 88B - EFFECT - JURISDICTION OF COLLECTOR - ESTOPPEL.
Fact of the Case:

A gift deed of land was executed in favor of a non-agriculturist trust in 1951. The Bombay Tenancy and Agricultural Lands Act, 1948 (Tenancy Act) was made applicable to the area in 1949. The tenant on the land became the owner of the land under the Tenancy Act in 1957. In 1956, section 88B was added to the Tenancy Act, allowing for the grant of exemption certificates to certain trusts. The trust obtained an exemption certificate under section 88B in 1964. The trust filed a suit challenging the order declaring the tenant as the owner of the land, arguing that the exemption certificate rendered the provisions of sections 63 and 64 of the Tenancy Act inapplicable. The trial court and the appellate court ruled in favor of the trust.
Finding of the Court:

The High Court held that the transfer of land to the trust was initially invalid under sections 63 and 64 of the Tenancy Act. The exemption certificate under section 88B could not validate the transfer because the Collector lacked jurisdiction to grant it. The tenant was not estopped from challenging the validity of the exemption certificate. The finality attached to the exemption certificate did not oust the jurisdiction of the Civil Court to examine the validity of the certificate.
Issues: 1. Whether the transfer of land to the non-agriculturist trust was valid under the Tenancy Act? 2. Whether the exemption certificate under section 88B rendered the provisions of sections 63 and 64 of the Tenancy Act inapplicable? 3. Whether the Collector had jurisdiction to grant the exemption certificate? 4. Whether the tenant was estopped from challenging the validity of the exemption certificate? 5. Whether the finality attached to the exemption certificate ousted the jurisdiction of the Civil Court to examine the validity of the certificate?
Ratio Decidendi: 1. The transfer of land to the non-agriculturist trust was initially invalid under sections 63 and 64 of the Tenancy Act because the trust was not an agriculturist. 2. The exemption certificate under section 88B could not validate the transfer because the Collector lacked jurisdiction to grant it. The trust did not have title to the land on the date when section 88B came into effect, and therefore, the Collector did not have jurisdiction to grant the exemption certificate. 3. The tenant was not estopped from challenging the validity of the exemption certificate because he did not make any representation that the gift made by the landlord in favor of the trust was valid. He merely stated that he had no objection to the grant of the exemption certificate. 4. The finality attached to the exemption certificate did not oust the jurisdiction of the Civil Court to examine the validity of the certificate. The finality was limited to the purpose of section 88B and did not prevent the Civil Court from determining whether the conditions precedent to the grant of the certificate existed.
Final Decision: The appeal was allowed. The decree passed by the trial court and confirmed by the appellate court was set aside, and the suit filed by the trust was dismissed.

JUDGMENT-This Second Appeal has got to be allowed on a very short point to which the attention of the lower Courts does not seem to have been invited.

2. A short statement of facts would be sufficient to formulate the point.

The suit property consists of R. S. No. 211 admeasuring 12 acres and 31 gunthas situate at Harali Budruk, Taluka Gadhinglaj, Dist. Kolhapur. Admittedly the property originally belonged to Prabhakarpant Korgaonkar and the defendant, who is the present appellant before me in this Second Appeal, was the tenant of the land. There is no dispute that the Bombay Tenancy and Agricultural Lands Act, 1948, (hereinafter, the Tenancy Act) was made applicable to this area on 1-5-1949. It appears that Korgaonkars started an educational institution in this area and the institution was registered under the Society's Registration Act in 1946. This institution was also registered under the Public Trust Act on 30th October 1952.

On 16-7-1951 the Korgaonkars gifted the suit land to the Trust by a registered gift· deed executed on that date. There is no dispute that on the date on which the gift-deed was executed by Prabhakarpant Korgaonkar to the Trust, which was called Shri Govindrao Korgaonkar Dharmadaya Sanstha, defendant was a tenant on the land. There is further no dispute that the Trust is not an agriculturist within the meaning of that word in the Tenancy Act.

On 1-4-1957 the defendant, who was a tenant on the land, should ordinarily have become the owner of the land. There is no dispute that in the proceedings held under section 32-0 of the Tenancy Act he was declared an owner of the land. He had paid all the instalments and a certificate under section 32M of the Tenancy Act has been issued to him.

It may be worthwhile stating the chronology of these events. On 30-9-1961 an order was passed by the Agricultural Lands Tribunal fixing the price of the land. This order was passed by the Tribunal in the said proceedings which were held after notices having been given to the original owner, Korgaonkars. It appears that subsequently the trustees of the Trust initiated proceedings under section 88B of the Tenancy Act for the exemption certificate under the same. It further appears that in those proceedings the tenant's statement was recorded. He stated that he had no objection to the exemption certificate being given to the Trust. On 31-1-1964 exemption certificate was granted to the Trust. Thereafter, on 19-12-1966 a certificate was issued by the Authorities under the Tenancy Act under section 32M of the Tenancy Act for the tenant having paid the entire amount of purchase price in lump sum.

Section 88B was added to the Tenancy Act on 1-8-1956; The effect of the said section 88B or rather of the inter-relations of the provisions of sections 63 and 64 on the one hand, and section 88B of the Tenancy Act on the other is the crux of the question which falls for my determination in this Second Appeal.

After the price was fixed by the Tribunal, the plaintiff-trust made an application to the Tenancy Authorities for exemption certificate under section 88B of the Tenancy Act. I have also mentioned above that the said section 88B came on the statute for the first time on 1-8-1956. Proceedings were held by the Tenancy Authorities in that behalf and in those proceedings, it appears, the defendant-tenant made a statement as mentioned above before ~he Authorities that he had no objection to the exemption certificate being granted to the plaintiff-Trust.

3. Being armed with the said certificate the plaintiff- Trust filed a suit in the Court of the Civil Judge, J. D. Gadhinglaj, for a declaration that the proceedings held by the Agricultural Lands Tribunal under section 320 of the Act in connection with the land in question and the order passed thereon by the Tribunal declaring that the defendant-tenant had become owner of the land with effect from 1-4-1957 was an illegal order and for ultra vires the provisions of the Tenancy Act. It was the

Click Here to Read the rest of this document