State of Punjab vs Baldev Singh - 2017 Supreme(P&H) 2909

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2017 Supreme(P&H) 2909

IN THE HIGH COURT OF PUNJAB AND HARYANA
Before
Hon’ble Mr. Justice Raj Shekhar Attri
RSA No.1314 of 1989 (O&M)
State of Punjab
v.
Baldev Singh & Ors.
{Decided on 13/10/2017}

Advocates:
For the Petitioner: Mr. H.S. Sullar, DAG, Punjab
For the Respondent:Mr. H.S. Dhandi, Advocate

Headnote:(A) Punjab Utilization and Surplus Area Scheme, 1973, Clause 10 – Surplus Area – Allotment of – Subsequent Purchaser – Original allottee executed sale deed in favour of plaintiff in violation of terms of scheme – Plaintiff has failed to make reasonable enquiry about ownership and competence of original allottee to transfer of land as it was specifically mentioned in revenue records that original allottee cannot transfer land before 15 years of allotment – Mere sanction of mutation does not confer title – Plaintiffs cannot held to be bona fide purchasers – Sale deed and mutation in favour of plaintiffs set aside.
       (B) Punjab Utilization of Surplus Area Scheme, 1973, Clause 10 – Surplus Area – Transfer of Allotted Land – Allottee shall be competent to transfer the allotted land in two conditions, firstly on payment of entire consideration and till he becomes owner thereof and secondly, for a period of 15 years, whichever condition falls later. (Para 16)
       (C) Transfer of Property Act, 1881, S.41 – Bona fide Purchasers – Section 41 of the Transfer of Property Act is not applicable in following situations:-
       (i) Where the transferee failed to conduct a reasonable enquiry with regard to the title of the vendor;
       (ii) Where he(transferee) does not act in good faith;
       (iii) The transaction is against the public policy;
       (iv) The transaction has violated any of the provisions of a statute.
       (v) Where the transfer was invalid as being forbidden by law. (Para 21)
       (D) Transfer of Property Act, 1881, S.41 – Bona Fide Purchaser – Provision under Section 41 of the Transfer of Property Act is in the nature of an exception to the rule that a person cannot confer better title than he has – The said provision provides that a transfer shall not be voidable on the ground that the transferor was not authorized to make it where with the consent express or implied of the real owner, the transferor is the ostensible owner of such property and transfers the same for consideration – The said provision obliges the transferee in all the transfers for consideration, and in addition, the transferee must have acted in good faith. (Para 20)
       This is based on the principle of equity that one, who allows another to hold himself out as the owner of an estate and a third party purchased the value from the apparent owner in the belief that he is the real owner, the man, who so allows the other to hold himself out, shall not be permitted to recover upon his secret title, unless he can overthrow that purchaser by showing either that he had direct notice/knowledge or something which amounts to constructive notice of the real title, or that there existed circumstances which ought to have put him upon an enquiry, which if prosecuted would have lead to a discovery of it.

JUDGMENT

Mr. Raj Shekhar Attri , J .:- The defendant-State has come up in this regular second appeal assailing the judgment & decree of learned first appellate court vide which appeal was accepted and suit filed by plaintiffs (respondents herein) was dismissed.

2. Undisputedly, earlier Harnam Dass chela Jamuna Dass was a big land owner having land in excess of the permissible area. Out of his total holding, the suit property measuring 90 kanal 19 marla was declared surplus under the provisions of Punjab Land Reforms Act, 1972 (in short ‘Act of 1972). As such same was vested with the State and was mutated in its name vide mutation Nos.08 and 09 (Ex.D1 and Ex.D2 respectively). However, the Punjab Utilization of Surplus Area Scheme, 1973 (for brevity ‘the Scheme’) has been formulated for the purpose of ultilization of the surplus area with certain conditions as provided under clauses 10 and 11 thereof. In pursuance of the Scheme, the suit land was proposed to be allotted to Kaka Singh son of Mangal Singh vide order dated 01.07.1975 (Ex.D3) under certain conditions as stipulated under the Scheme. However, it has been stipulated in allotment order Ex.D3 that the fair rent has not been assessed and after its assessment, the compensation shall be recovered from the allottee and allotment certificate shall be issued to him on payment of the entire compensation/consideration.

3. It is pertinent to mention here that under Clause 10 (d) of the Scheme it is specifically provided that allottee shall become owner only on the payment of entire amount of compensation as assessed by the Collector. Further, the condition is imposed under Clause 10 (e) of the Scheme that the allottee shall not be competent to transfer his rights in the land allotteed to him to any person till he becomes the owner or before the expiry of 15 years of the date of possession, whichever is later. Clause 11 thereof makes it abundantly clear that if there is any violation in the conditions imposed under clause 10, then the allotment shall be cancelled.

4. It is apparent on the record that said Kaka Singh or aforesaid vendees Baldev Singh and others had paid nothing towards the compensation as required under clause 10 of the Scheme. Resultantly, the allotment in favour of Kaka Singh was liable to be cancelled on this score.

5. However, in pursuance of the order of allotment Ex.D3, mutation No.10 (Ex.D4) was entered and sanctioned in the name of Kaka Singh on 24.07.1975.

6. Said Kaka Singh, while wrongly asserting himself to be the exclusive owner had transfered the suit land by way of sale deed No.3854 dated 05.11.1982 (Ex.P1) in favour of Baldev Singh, Tehal Singh sons of Fateh Singh to the extent of 1179/1819 share (which comes to 58 kanal 19 marla land) and in favour of Subhash Chand son of Sant Ram and Avtar Singh son of Mehar Singh to the extent of 640/1819 share (which comes to 32 kanal land) for a total consideration of Rs.49,000/-.

7. When it came to the notice of the State that abovesaid Kaka Singh had not paid the requisite compensation, rather he had transferred the allotted area in favour of abvoesaid Baldev Singh and others in complete violation of Clause 10(e) ibid, the said allotment was cancelled vide orders Ex.D7 and Ex.D8 which are dated 12.10.1984 by Collector, Agrarian, Kharar. Resultantly, mutation No.39 (Ex.D9) was re-entered and sanctioned in the name of State of Punjab by Assistant Collector, vide his order dated 12.02.1985.

8. After sanctioning of the mutation Ex.D9, instant suit No.479 dated 15.11.1985 was filed by abovesaid vendees namely Baldev Singh, Tehal Singh, Subhash Chander and Avtar Singh (all respondents before this court) for declaration to the effect that they are the owners in possession of the suit land and sought permanent injunction restraining the State of Punjab from alienating the same in favour of anybody and from interfering in any manner into their proprietary rights and also restraining the appellant from dispossessing the

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2017 Supreme(P&H) 2909

IN THE HIGH COURT OF PUNJAB AND HARYANABeforeHon’ble Mr. Justice Raj Shekhar AttriRSA No.1314 of 1989 (O&M)State of Punjabv.Baldev Singh & Ors.{Decided on 13/10/2017}

Cases Referred (2)

IN THE HIGH COURT OF PUNJAB AND HARYANA
Before
Hon’ble Mr. Justice Raj Shekhar Attri
RSA No.1314 of 1989 (O&M)
State of Punjab
v.
Baldev Singh & Ors.
{Decided on 13/10/2017}