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PETITIONER: STATE  OF MADHYA  PRADESH

       Vs.

RESPONDENT: YAKINUDDIN

DATE OF JUDGMENT: 04/05/1962

BENCH: SINHA, BHUVNESHWAR P.(CJ) BENCH: SINHA, BHUVNESHWAR P.(CJ) GAJENDRAGADKAR, P.B. WANCHOO, K.N. AYYANGAR, N. RAJAGOPALA AIYYAR, T.L. VENKATARAMA

CITATION:  1962 AIR 1916            1963 SCR  (3)  13  CITATOR INFO :  F          1968 SC1218  (4)  R          1970 SC 706  (8,9)  F          1985 SC1293  (114,115,127)

ACT: Abolition  of Proprietary Rights-Consequence of  vesting  of such   rights  in  the  State-  Transfer  of   interest   by Proprietor-If enforceable against the State--Madhya  Pradesh Abolition of Proprietory Rights (Estates, Mahals,  Alienated Lands) Act, 1950 (M.P.1 of 1951), ss. 3, 4, 5, 6.

HEADNOTE: Section  4  (1)  (a)  of the  Madhya  Pradesh  Abolition  of Propeietary  Right’s (Estates, Mahals Alienated Lands)  Act, 1950,  provides that  when the notification under, s. 3  in, respect  of any areas. has been, published in  the  Gazette, then,,  notwithstanding anything contained in any  contract, grant or document or in any other law for the time being  in force,  and  save as otherwise, provided in  this  Act,  the consequences  as  hereinafter  set  forth  shall..   ensure, namely,  (a) all rights, title and interest vesting  in  the proprietor or any person having interest in such proprietary right  through  the proprietor in such area  including  land (cultivable  or  barren), grass land,  scrubjungle,  forest, trees.  . . shall cease and be vested in the State  for  the purposes   of  the  State  free  of  all  encumbrances   The respondents,  by  grants  from  and,  agreements  with   the proprietors,  acquired them right to propagate lac,  collect tendu  leaves and gather fruits and flowers of Mahua  leaves in;  certain estates.  On the coming into effect of the  Act and  the issue- of necessary notifications under s.  8,  the State  took  possession  of  the  estates  and  refused   to recognise  the rights claimed by the respondents.  The  High Court  relying on the decision of this Court  in  Chhotabhai Jethabhai  Patel and Co. v. State of Madhya  Pradesh,  (1953 S.C.R. 476, held the rights, claimed by the respondents  had not been affected by the Act.  The State appealed.  The case of  the respondents was that their rights were, saved by  s. 6(1) of the Act which was as follows :-

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             "6(1)  Except as provided in sub-section  (2),               the  transfer  of any right  in  the  property               which  is  liable to vest in the  State  under               this  Act made by the- proprietor at any  time               after  the 16th Match 1950 shall, as from  the               date of vesting be void."               14 Held, that whatever rights the respondents had acquired from the proprietors ceased to have effect by the operation of s. 4(1)(a)  of  the Act on the vesting of the  estates  in  the State.   It was not correct to say that s. 6(1) of  the  Act saved   those  rights.   That  Section  referred  to   those transaction of transfer of right which was liable to vest in the State and rendered them void.  It did not lay down  that a  transfer  made  before March 16,  1950,  was  necessarily binding on the State. The  Act had for its object the acquisition by the State  of all interests in the estate that the proprietor or an inter- mediary had in it except those of the actual tillers of  the soil.   Clauses  (a) to (h) of s. 5 of the Act  showed  what interests were saved by the Act and the interests sought  to be  enforced  by the respondent, were none  of  these.   The rights  claimed  by them, therefore, could not  be  enforced against the State. Chhotabhai  Jethabhai  Patel  and Co.  v.  State  of  Madhya Pradesh, [1953] S.C.R. 476, overruled. Shrimati Shantabai v. State of Bombay, [1959] S.C.R. 265 and Mahadeo  v.  State  of Bombay, [1959] Supp.  2  S.C.R.  239, applied.

JUDGMENT: CIVIL APPELLATE JURISDICTION :Civil Appeals Nos. 229   & 281 to 283/1961.  WITH C.   A. Nos. 281 to 283 of 1961. Appeals  from  the judgment and orders  dated  February  20, 1958,  of  the Madhya Pradesh High  Court  in  Miscellaneous Petitions Nos. 500 and 524 of 1954 and 419 of 1955. I.N. Shroff, for the appellants. S.   N.  Kherdekar,  B. N. Srivastave, N. K.  Kherdekar  and Ganpat Rai, for the respondent (in C.   A. No. 229/61). G.   C. Mathur, for the respondent (in C. A. No. 281/61). H.N. Sanyal, Additional Solicitor General of India and G. C. Mathur, for the respondent ’in C.A. No. 282/61). W.   S. Barlingay and A. G. Batnaparkhi, for the  respondent (in C. A. No. 283/61). 15 1962.  May 4. The Judgment of the Court was delivered by SINHA,  C.  J.-In these appeals the common question  of  law that  arises  for determination is  whether  the  respective grants  made  by the outgoing proprietors in favour  of  the respondents  convey  any  rights to  them.  which  could  be enforced against the appellant, the State of Madhya Pradesh, after  the  coming  into  effect’  of  the  Madhya   Pradesh Abolition of Proprietary Rights (Estates, Mahals,  Alienated Lands) Act, 1950 (Madhya Pradesh Act  of 1951)-which will be referred to hereinafter is the Act. It  is not necessary to state the facts of each case in  any detail  because they are not disputed, and nothing turns  on the difference in facts.  In Civil Appeal No.  229  of 1961, the respondent obtained, by virtue of registered  documents, the  grant of 24 villages in Balaghat and Mandla  Districts, for  propagating lac, the lease to expire on July 31,  1955.

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In  Civil  Appeal  No.  281  of  1961,  by  virtue  of   two unregistered  agreements, the respondent obtained the  right to  collect tendu leaves in 37 villages upto July 31,  1963. In  Civil  Appeal No. 282 of 1961, the  respondent  obtained similar  rights from the proprietor by virtue of  registered agreements,  extending up to the end of the year  1962.   In Civil  Appeal No. 283 of 1961, the respondent  obtained  the right  to collect fruits and flower of Mahua trees from  the proprietor,  extending down to the year 1969, by  virtue  of three registered leases. On  the coming into effect of the Act and the issue  of  the necessary   notifications  under  s.  3  of  the  Act,   the appellant,  the State of Madhya Pradesh, took possession  of all the villages comprised in the respective estates of  the proprietors,  who were the grantors of the several  interest indicated above 16 in, favour of the respondents The State refused to recognise the  rights  claimed  by the respondents by  virtue  of  the transactions aforesaid in their favour. In  each case, the High Court relying upon the  decision  of this  Court  in Chhotabhai Jethabai, Patel and  Co.  v.  The State,  of Madhya Pradesh (1) granted the relief claimed  by the respondents, and hold that the several interests claimed by the respondents had not been affected by the coming  into force  of  the  Act.   The High Court  did  not  accept  the contention raised-on behalf of the State that as a result of the  coming into operation of the Act all  these  interests which were the subject matter of dispute in all these  cases had been extinguished, in view of the provisions of s. 4 (1) (a)  of  the Act Soon after the decision aforesaid  of  this Court, the matter was re-examined by this Court in the  case of  Shrimati Shantabai v. State, of Bombay (2), and  in  the case of Mahadeo v. The, State of Bombay (3). The  earliest decision of this Court with reference  to  the Act is a decision of the Division Bench of three.  Judge  in Chhotabhai  Jethabai  Patel and Co. v. The State  of  Madhya Pradesh (1).  In that case, which, was a petition under Art. 32  of  the Constitution, the petitioners had  entered  into various contracts and agreements with the proprietors of the estates, before the dates on whit the estates vested in  the State,  under  the Act, under which they  were  entitled  to pluck,  collect and carry away tendu leaves,. and to  culti- vate, culture and acquire lac, as also to out and carry away teak,  and timber.  The petitioners had complained  to  this Court that the State of Madhya Pradesh had been  interfering with their rights thus (1) (1953) S.C.R. 476.    (2) (1959) S.C.R. 265. (3)  (1959) Supp. 2 S.C.R. 339. 17 acquired  from’ the outgoing proprietors.  This Court  held, on  a  construction  of the contracts, that  the  grants  in essence and effect were licences to the petitioners who were neither proprietors, nor persons having any interests in the proprietary  rights through the proprietors, nor were  their interests   ’encumbrances’  within  the  meaning   of   that expression  in  s. 3 (1) of the Act.  In that  view  of  the matter,  the  Court  granted  the writs  in  favour  of  the petitioners.  Naturally, the High Court granted  appropriate reliefs  to the respondents in this batch of cases,  relying upon this decision of this Court. In the case of Shrimati Shantabai v. State of Bombay (1) the same  question came up to be re-examined by  a  Constitution Bench  of  this  Court.  The petitioner  in  that  ease  had obtained   from  the  proprietor  the  right  to  take   and

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appropriate  all kinds of wood from certain forests  in  his estate,  by  an unregistered document.  On the  coming  into effect of the Act, the State authorities interfered with the petitioner’s  rights  under the grant from  the  proprietor. The  petitioner  moved  this  Court under  Art.  32  of  the Constitution, complaining of interference by the State  with those  rights.  This Court held that if the grant  purported to  transfer any proprietary interest in land, it  would  be ineffective  because  it was not evidenced by  a  registered document,  and that under is. 3 of the Act  all  proprietary interest vested in the State.  If it was a grant of  profits a  prendre it would partake of the nature of immovable  pro- perty  and  would  not be  effective  without  a  registered document evidencing the grant.  If on the other hand it  was a  more  contract creating personal rights,  the  petitioner could-not  complain  of  any  act on  behalf  of  the  State officials because (1)  (1959) S.C.R. 265. 18 the  State had not taken possession of the  contract,  which remained  the petitioner’s property.  The State not being  a party to that contract, would not be bound by it, and  that, alternatively,  if the State were bound by the terms of  the contract, the petitioner’s remedy lay by way of suit for the enforcement of the contract.  Hence, it was held that  there was no question of the infringement of any fundamental right in that case. The provisions of the Act also came in for consideration  in the  case  of Mahadeo v. The State of Bombay (1).   In  that case,  the  petitioners  had  obtained  from  the   outgoing proprietors  the  right to collect tendu  leaves  and  other forest  produce  in  villages  which  formed  part  of   the proprietors’  estates, before the coming into effect of  the Act.  Some of the agreements were registered whereas  others were  not.  The State did not respect those grants and  put- those  rights to auction, after having taken  possession  of those estates, when they had vested in the State under s.  3 of  the  Act.  The petitioners then moved this  Court  under Art. 32 of the Constitution complaining of the  infringement of their rights to property.  It was held by this Court that the agreements required registration, and in the absence  of registered documents could not confer any rights, which were some  interest  in  land.   It was  also  held  that  rights conveyed  to  the  petitioners  under  the  agreements  were proprietary rights which, under the provisions of ss. 3  and 4 of the Act became vested in the State.  Alternatively,  if the interests created by the agreements were not in  respect of  proprietary rights, it was held that in  those  interest the State was not interested, as the State was not bound  by the agreements entered into by the outgoing proprietors. It  would  thus  appear  that in  view  of  this  two  later decisions  of  this Court, the High Court was  in  error  in granting any relief to the respondents.  But (1)  (1959) Supp. 2 S.C.R. 339. 19 it  has  been contended on behalf of  the  respondents  that certain  aspects of the controversy had not been brought  to the  notice of the Court on the previous occasion, and  that the respondents were entitled to the benefit of s. 6 of  the Act.  It was contended that the respondents’ right were  not in  the nature of mere licences, but were in the  nature  of profits  a prendre, which were saved to them in view of  the provisions of s. 6. In  our  opinion, there is no substance  in  the  contention raised on behalf of the respondent.  Under s.. 3 of the Act,

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from  the  date  of  the  notification  by  the  State,  all proprietary  rights in an estate vesting in a proprietor  of such  an  estate  or in a person  having  interest  in  such proprietary rights through the proprietor, shall vest in the State  for  the  purposes  of  the  State,  free  from   all encumbrances.  The consequences of such a vesting  are  laid down  in  s.  4, which runs into several  clauses  and  sub- sections.  section 4(1)(a) is the relevant provision of  the Act  which determines this controversy entirely against  the respondents.  It provides that "when the notification  under s.3  in  respect  of  any area has  been  published  in  the Gazette,  then,  notwithstanding anything contained  in  any contract, grant or document or in any other law for the time being in force, and save as otherwise provided in this  Act, the  consequences  as hereinafter set  forth  shall,  ensue, namely,  (a) all rights, title and interest vesting  in  the proprietor or any person having interest in such proprietary right  through  the proprietor in such area  including  land (cultivable  or  barren), grass land,  scrubjungle,  forest, trees  ...  shall cease and be vested in the State  for  the purposes  of the State free of all encumbrances..."(We  have omitted  the words which are not necessary for the  purposes of  the present appeals).  It is clear on a bare reading  of the  provisions of cl. (a) of s. 4 (1) that whatever  rights the proprietor, or a person claiming interest through 20 him, had in the trees, scrubjungle, forest, etc., ceased  on the vesting of the estate in the State. But  it was contended on behalf of the respondents  that  s. 6(1)  saves their rights from the operation of  s.  4(1)(a), because,  it  is  argued,  s.  4(1)(a)  is  subject  to  the provisions of s. 6(1).  Section 6(1) runs as follows               "6(1)  Except as provided in sub-section  (2),               the  transfer  of any right  in  the  property               which  is  liable to vest in the  State  under               this  Act made by the proprietor at  any  time               after  the 16th March 1950 shall, as from  the               date of vesting, be void." In  our opinion, there is no substance in  this  contention. Section  6 refers to those transactions of transfer  of  any right  which is liable to vest in the State as  being  void. It  does not lay down that a transfer made before March  16, 1950, shall be binding upon the State.  The transfers  which have been saved by s. 6(1) from being void may be recognised by  the  State for which the transferee may be  entitled  to claim some compensation in accordance with the provisions of the  Act.  But s. 6 does not save’ that interest from  being vested in the State as a result of the notification under s. 3,  read with s. 4(1) (a).  The’ scheme of, the Act is  that it  provides  for  the  acquisition  by  the  State  of  all interests  in the estate of the proprietor himself or of  an intermediary,  except the tiller of the soil.  This it  does by vesting all proprietary rights in the State, of  whatever grade, by issuing the notification under s. 3, vesting it in the  State,  for  the purposes of the State  free  from  all encumbrances.   Section  4  lays down in  great  detail  the rights  which  become  extinguished on the  vesting  of  the estate as aforesaid.  What is saved to the proprietor or any other  person claiming through him is set out in s. 5,  cls. (a)  to  (h),  on  such  terms  and  conditions  as  may  be determined 21 by the State.  Hence any person claiming some interest as  a proprietor or as holding through a proprietor in respect  of any  proprietary interest in an Al estate has got  to  bring

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his interest within s. 5, because on the date of vesting  of the  estate,  the Deputy Commissioner takes  charge  of  all lands  other than occupied lands and homestead, and  of  all interests vesting in the State under s, 3. Upon such  taking over  of  possession, the State becomes liable  to  pay  the compensation  provided  for  in s.  8  and the  succeeding sections.   The respondents have not been able to show  that their interest come under any of the clauses aforesaid of s. 5. A  great  deal  of argument was advanced on  behalf  of  the respondents  showing the distinction between a bare  licence and a licence coupled with grant or profit a prendre.   But, in  our opinion, it is not necessary to discuss  those  fine distinctions  because whatever may have been the  nature  of the  grant  by  the outgoing proprietors in  favour  of  the respondents, those grants had no legal effect as against the State,  except  in so far as the State may  have  recognised them.   But  the provisions of the Act leave  no  manner  of doubt  that the rights claimed by the respondents could  not have been enforced against the State, if the latter was  not prepared  to respect those rights and the rights created  by the transactions between the respondents and their  grantors did not come within any of the saving clauses of s. 5. In view of these considerations, it must be held that  these cases  are  equally governed by the decisions  aforesaid  of this  Court, which have overruled the earliest  decision  in the  case of Chhotabhai Jethabai Patel and Co. v. The  State of Madhya Pradesh (1).  The appeals are accordingly  allowed with costs throughout, hearing fee one set in this Court. Appeal allowed. (1)  (1953) S .C.R. 476. 22