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PETITIONER: STATE OF KERALA AND ORS.

       Vs.

RESPONDENT: K.A. GANGADHARAN

DATE OF JUDGMENT27/10/1976

BENCH: RAY, A.N. (CJ) BENCH: RAY, A.N. (CJ) BEG, M. HAMEEDULLAH SINGH, JASWANT

CITATION:  1977 AIR  311            1977 SCR  (1) 960  1977 SCC  (1) 208  CITATOR INFO :  D          1979 SC1573  (17,32,65)

ACT:             Kerala Land Reforms Act 1964---Sec. 81, 83, 84, 85,  85A         and 86 Voluntary transfers made after notified date  whether         valid.

HEADNOTE:             The  respondent held 28.4 acres of land and,  therefore,         filed  a return under Section 85(a) of the Kerala  Land  Re-         forms  Act, 1964.  In the return,  he showed his  family  as         consisting  of himself, his wife and 3 children. Section  84         of  the Act provided that all voluntary  transfers  effected         after  publication  of the Kerala Land Reforms  Bill,  1963,         except  certain  transfers  which  were  excepted  shall  be         deemed  to be transfers calculated to defeat the  provisions         of  the Act and invalid.  The Act was amended by Act  35  of         1969’  which came into force on 1-1-1970.  By virtue of  the         said amendment, 1-1-1970 was declared as the notified  date.         Section  83  provides  that with  effect from  the  notified         date no person shall be entitled to own,  hold or to possess         land   in  excess of certain acres of  land.  Section  85(1)         provides that any person  holding land in excess on notified         date  shall surrender the excess.   Section 85 and  85A  are         the sections laying down the procedure for surrender of  the         excess  land.  Section 86 provides that on determination  of         the excess  land under section 85 the same will vest in  the         State.  On 1-1-1970, the respondent had one major child  and         two minor children.  One  minor child  attained the  age: of         majority in 1971 and another attained majority in 1973.   In         March,   1973, 3 gift deeds were executed one in  favour  of         each one of the children. The respondent was called upon  to         hand over the excess land on. the ground that the  transfers         executed  after 1-1-1970 in favour of the children who  were         minor  on  1-1-1970  will be ignored and the  land  will  be         treated  as  land owned by the respondent.   The  respondent         filed his objections and contended that he and his wife were         the  only  members of the family and that if  the  transfers         were excepted he did not hold land in excess of the ceiling.         The  Land Board came to the conclusion that out of the  28.4         acres of land held by  respondents  3.9 acres were  exempted

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       under  section  81 and that the land measuring   3.8   acres         gifted to the major child was a valid gift and in   addition         the   respondent was entitled to hold 12 acres of land.   He         came  to  the conclusion that the  respondent   was  holding         excess  land  to the extent of 8.78 acres.  The  respondents         filed  a Revision Petition in the High Court  which  allowed         the same.                       In  an appeal by Special Leave the  respondent                       contended:                          (1) Section 83 is relevant only for  fixing                       ceiling.   It does not say that a person or  a                       family loses his title on the notified date.                          (2)  Donees were not minors on the date  of                       gift.   That would not constitute the  members                       of the family.                           961                          (3) Gifts in the present case are saved  by                       the last exception to section 84 which permit-                       ted  gifts to any person out of  natural  love                       and affection or, at any rate, they are  saved                       by  Amendment  Act  17 of 1972  by  which  the                       exception  to Section  84 was made   effective                       from 16-8-1968, in favour of transfers by  way                       of gifts in favour of son or daughter or other                       near relations.                          (4)  Sections 85 & 85A lay down the  proce-                       dure’   for   surrendering  the  excess  land.                       Section 86 vests the excess land in the State.                       The  vesting takes place after  the  procedure                       under  sections  85 and 85A is over  and  till                       then  the respondent was the legal  owner  and                       could have and in fact validly gifted the land                       in question.                       The appellants contended:                          (1) The gifts made after 1-1-1970 were  not                       saved by exception  to section 84.                          (2) The view taken by the Single Judge  has                       been  over-ruled by a Division Bench and  Full                       Bench of the same High Court.                       Allowing the appeal,                       HELD:  (1,) The provisions of the  Act  dearly                       establish  the dominant legislative intent  of                       the imposition of the ceiling on laud holdings                       and the consequential obligation to  surrender                       laud  owned or hold  in excess of the  ceiling                       area  on the notified date, namely,  1-1-1970.                       Section 84 was enacted because the Legislature                       anticipated transfers with a view to.  circum-                       vent the provisions of law.  Transfers between                       15-8-1963  and  1-1-1970’  will  be  valid  if                       within the exceptions provided  by section 84.                       Transfers  made  after 1-1-1970 even  of   the                       excepted  varieties  are  to  be  ignored  and                       obligation  to  surrender the excess  land  on                       1-1-70   cannot  be  excepted  by    voluntary                       transfers  made  subsequent  to.the   notified                       date. [964 G-H, 965 C-D]                          (2) Notified date is 1-1-1970.  That is the                       relevant  date for fixing    ceiling.   Subse-                       quent  changes  in  the  constitution       of                       family  are    irrelevant- [965 H]

JUDGMENT:

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       CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1177 of 1975.             (From  the  judgment and order dated 10-10-1974  of  the         Kerala High Court in Civil Revision Petition No. 734/74).         K.T. Harindranath, and K.M.K. Nair, for the appellants.         T.C. Raghavan and P.K. Pillai, for the respondent.         The Judgment of the Court was delivered by         RAY,  C.J.--This appeal is by special leave from the   judg-         ment dated 10 October, 1974 of the High Court of Kerala.             The  respondent in the High Court challenged  the  order         of  the Land Board directing him to surrender 8.78 acres  of         land.   The High Court declared on a revision petition  that         the respondent  was not liable to surrender the lands speci-         fied in the order of the Land Board.              The respondent  flied a statement  under section  85(a)         of  the Kerala Land Reforms Act 2964 hereinafter called  the         Act  and  showed  there that the statement  related  to  the         family consisting of himself, his wife and children.  Two of         his  children  were minors on 1 January, 1970.  The  ceiling         area  allowed  under section 82(1) of the Act for  a  family         consisting of two or more but not more than five members  is         10 standard acres which should not be less than 12 and  more         than  15  ordinary  acres in extent.  On  this  footing  the         respondent would be entitled to have not less than 12  acres         on the notified date, namely, 1 January, 1970.  He was found         to have a total area of 28.38 acres. He alone was the  owner         of  all the lands.  Out of 28.38 acres 3.87 acres  were  ex-         empted under section 81.  Excluding 3.87  acres and  another         12  acres  for the ceiling area the excess  land  was  12.51         acres.  A statement showing the determination was served  on         him and his wife.  They were asked to file objections.             Two  of the respondent’s children a daughter and  a  son         who were minors on 1 January 1970 attained majority in  1971         and  1973  respectively.  On 28 March, 1974  the  respondent         executed three deeds of gift transferring a total extent  of         12.83  acres to his three children. To the eldest of them  a         daughter, who was a major on 1 January, 1970 he  transferred         3.84  acres.  To the second daughter who became a  major  in         1971  he transferred 3.85 acres and to his son who became  a         major in 1973 he transferred 5.14 acres.             The  respondent  flied  an objection on  5  April,  1974         stating that he and his wife who were the remaining  members         of  the statutory family did not hold more than the  ceiling         area  available  to  the family  and therefore  he  was  not         liable to surrender any excess land.  The Land Board  recog-         nised  the gift to the eldest daughter who was a major on  1         January  1970 and required the respondent to surrender  8.78         acres which was the subject matter of the other two deeds of         gift.             The  respondent’s contention which was accepted  by  the         High  Court was repeated here. The contentions  were  these.         The  donees were not minors on the date of the gift.  There-         fore, the son and the daughter would not constitute  members         of the family.  Section 82 of the Act only fixes the.  ceil-         ing area.  The ceiling is 5 acres for an unmarried person of         a  family  consisting of one sole   surviving  member.   The         ceiling  is 6 acres for a family of two to five members,  12         acres  for  a family of more than 5 members,  10  acres  in-         creased by one acre for each member in excess of 5 etc.  The         respondent  emphasises  that  the status or  nature  of  the         person  or the family is relevant.  If a person is a  single         member  family  on  the relevant date, he  cannot  claim   a         larger ceiling on the ground that he became a two member  or         five  member family later.  Under section 83 of the Act  the         notified  date  is 1 January, 1970.  This notified  date  is         relevant  only for fixing such ceiling. Section 83 does  not

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       say that the particular person or family loses its title  to         the excess land on that date.  Section 84 of the Act has two         parts.  The first part contains body of  the section.    The         second  part contains exceptions.  Therefore, it is said  by         the respon-         963         dent that all voluntary transfers of excess land failing  in         the  body  of the section shall be deemed  to  be  transfers         calculated to defeat  the provisions of the Act and shall be         invalid.   The  gifts in the present case are  said  by  the         respondent  to fall under the last exception  of section  84         of  the Act and it is said that the transaction is saved  by         the last exception.             The respondent further contends that on 1 November, 1972         the  Amendment  ’Act 17 of 1972 deleted  two  exceptions  in         section 84 of the Act with effect from 16 August, 1968.  The         two  deleted exceptions were first a transfer on account  of         natural  love and affection and second a transfer in  favour         of  a religious charitable or educational institution.   The         Amendment Act of 1972 added an exception with effect from 16         August  1968. The exception is a transfer by way of gift  in         favour of his son or daughter, or the son or daughter of his         predeceased ’son or daughter by any person owning or holding         land in excess of the ceiling area.             The respondent contends that in the present case the two         impugned  gifts  to a daughter and  son  respectively,  and,         therefore,  they come directly under the newly added  excep-         tion  introduced  by Act 17  of 1972 and  the  exception  is         deemed to be effective from 16  August, 1968.  The  respond-         ent further contends that section 85 and section 85A of  the         Act  lay  down the procedure for   surrendering  the  excess         land.   Section 86 of the Act vests the excess land  in  the         Government. The vesting happens both on the determination of         the extent and other particulars of the lands, the ownership         or possession or both of which is or are to be  surrendered.         The  respondent contends that until then namely the  vesting         of  the  land the owner of the land i.e. the  respondent  in         this case is the legal owner and his ownership or possession         is  not  diverted.  He can therefore deal with the  land  in         legal  valid  manner. A gift under the  last  exception  not         being  hit by the invalidity contemplated by section  84  of         the Act is a valid gift, which the respondent was  competent         to make.             The respondent contends that it is incorrect to say that         a   gift coming within the last exception of section  84  is         ineffective   after   1  January, 1970 inasmuch  as  such  a         contention will make section 84 a dead letter after 1  Janu-         ary,  1970.   It  is said that it could not  have  been  the         intention of the legislature which added the exception  only         on  1  November,  1972.  The exceptions  introduced  by  the         Amendment  Act of 1972 to section 84 are three.   The  first         is   partition. The second is transfer to a person  who  has         been a tenant from 27 July 1960 up to the date of  transfer.         The third is a transfer to a son or a daughter or a grandson         or  grand  daughter by a predeceased son or  daughter.   The         respondent submits that the intention of the legislature  is         that  in all these cases a person can transfer until  he  is         divested of his ownership under section 86.  The  respondent         further  contends  that  the scheme of the Act  and  of  the         Amendment Act of         964         1972 regarding gift is this.  Until 16 August 1968 a gift to         any person is valid if the gift was out of natural love  and         affection. After that date namely the amendment Act of  1972         only  gifts  to sons daughters and grand children of  prede-

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       ceased  children are valid.It is said that there is  nothing         in  the  Act which says that an owner  like  the  respondent         cannot  deal with his land in a lawful and valid  manner  as         long  as he is the owner thereof or as long as ownership  is         vested  in him.  Section 87 of the Act says that  where  any         person  acquires  any  land after the  date  notified  under         section  83  by gift, purchase,  mortgage  with  possession,         lease,  surrender or any other kind or transfer inter  vivos         or  by  bequest or insistence or otherwise  and   in  conse-         quence  thereof  the total extent of land owned or  held  by         such  person exceeds the ceiling area, such excess shall  be         surrendered   to   such  authority  as  may  be  prescribed.         Section 87 according to the respondent indicates that  after         the notified date 1 January, 1970 valid gifts are  possible,         as such gifts are saved by exceptions to section 84.         The Kerala Land Reforms Act Of 1964 came into force  on  1         April 1964.  On 1 January, 1970 the Kerala Land Reforms  Act         as amended by Act 35 of 1969 came into force.  The  respond-         ent  made gifts of his excess land on 28 March, 1974.  On  5         April,  1974 the Land Board served notice on the  respondent         saying  that’ the  gifts were invalid and directed  the  re-         spondent  to  surrender  the excess Land in  excess  of  the         ceiling area as found on 1 January, 1970.           On behalf of the State it is contended that the view taken         by the Single Judge in the present case has been  over-ruled         by a  Division Bench of the Kerala High Court in a  decision         reported  in 1975 K.L.T. 171.  It is also said by the appel-         lant that  the  decision  of the Division Bench is  affirmed         by  the Full Bench of the Kerala High Court in the  Judgment         reported in 1976 K.L.T. 362.           Section 82 of the Act lays down the  principles  governing         the fixation of the land ceiling area in respect of  differ-         ent  categories  of persons.  Section 83 of the  Act  states         that  with effect from the notified date no person shall  be         entitled  to own or hold  or  to  possess under  a  mortgage         lands  in the aggregate in excess of the ceiling area.  Sec-         tion  84  of the Act provides that all  voluntary  transfers         effected  after the publication of the Kerala  Land  Reforms         Bill 1963 in  the Gazette, namely, 15 September 1963, other-         wise that in certain modes specified in section 84, shall be         deemed  to be transfers calculated to defeat the  provisions         of  the Act and shall be invalid.  Section 85(1)  lays  down         that  if  any person owns or holds land in  excess  of   the         ceiling  area  on the notified date, such  excess  shall  be         surrendered  as  provided in the section.  Section  86  lays         down  that on determination by the Land Board of the  extent         and other particulars of the  lands to be surrendered by the         person under section 85 the ownership or possession or both,         as  the case may be, of the lands shall vest in the  Govern-         ment  free  from any encumbrance.  Section 87   deals   with         cases  where persons have acquired lands after the  notified         date   by transactions inter vivos, such as gift,  purchase,         mortgage with possession         965         lease,  surrender or by bequest, or inheritance etc. and  in         consequence  thereof the total extent of land owned or  held         by  such person exceeds the ceiling area, such excess  lands         should  also be surrendered to the prescribed authority  and         that  such  land shall also vest in  the   Government  under         section 86.             These  provisions  in the Act  establish  the   dominant         legislative intent of the imposition of the ceiling on  land         holdings and the consequential obligation to surrender lands         owned  or held in  excess  of the ceiling area on the  noti-         fied date, namely, 1 January 1970.  The legislature  noticed

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       the  possibility  that after the proposal to  introduce  the         Kerala Land Reforms Bill 1963 published in the  Gazette   on         15  August, 1963, there might be transactions  of  transfers         with  a view to circumventing the provisions of the  contem-         plated legislation.  It is to meet the said situation  that.         section  84 of the Act  lays  down that all  such  voluntary         transfers  that have taken place subsequent to the  date  of         publication  of the Bill, namely, 15 August 1963,  otherwise         than  in  the limited modes specified in the  said  section,         shall  be deemed to be transfers calculated to.  defeat  the         provisions of the Act and shall be invalid.  It is  apparent         that section 84 was enacted with a view to making the provi-         sions  of  sections 83 and 85 effective.   For  purposes  of         calculation of the ceiling area and the determination of the         extent  of  the  excess land to be  surrendered  by  persons         account will be taken not merely of the land actually  owned         and possessed by him on the notified date, namely, 1 January         1970,  but  also   of land voluntarily  transferred  by  him         subsequent  to  the date of publication of the Bill  in  the         Gazette on 15 August 1963 by transactions not falling within         the certain categories mentioned  in  section 84. Section 84         prohibits  persons  from transferring their   excess   lands         after 15 August, 1963 except as provided in that section.             The  effect  of sections 83 and 85 has been  noticed  by         this  Court in the decision dated 20 August, 1976  in  Civil         Appeals No. 907-909 of 1974 and Civil Appeals No.. 1354  and         1355  of 1975 (State  of Kerala & Ors. v. Philomina(1).   It         has been  held  there  that the prohibition against  ceiling         area  under section 83 of the Act and the surrender  of  the         excess  land  under  section 85 of the Act are  both  to  be         determined  with reference to the position as on the   noti-         fied date under section 83 of the Act.  The crucial date for         determining  and surrendering the surplus land is 1  January         1970 and  not  any earlier date.             Transfers  which  have been effected between  15  August         1963  and 1 January 1970 will be treated as  valid  provided         they   come  within the excepted  categories  enumerated  in         section  84  of  the Act. The lands covered  by  such  valid         transfers  will be treated as properties belonging  to.  the         transferors on the notified date for purposes of determining         a  ceiling area and the extent of excess land to be  surren-         dered  by  him.  In respect of transfers  effected  after  1         January  1970  the ceiling area applicable to a  person  and         the extent of his liability to         (1) [1977] 1 S.C.R. 273.         966         surrender, which became crystallised on 1 January 1970, will         determine the excess land to be surrendered.  The obligation         to surrender the excess land owned or possessed by person as         on 1 January 1970 cannot be affected by voluntary  transfers         even  of the excepted varieties mentioned in section  84  of         the  Act subsequent to the  notified date.   The  transferor         will  continue to be liable to surrender to  the  Government         the  full extent of the excess land that was in his  posses-         sion as on 1 January 1970.             The High Court erred in holding that the respondent  was         not  to surrender the land.  The appeal is accepted for  the         foregoing  reasons and the judgment is set  aside.   Parties         will pay and bear their  own costs.         P.H.P.         Appeal allowed.         967