REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.    2656         OF 2009 (Arising out of S.L.P. (C) No. 10223 of 2007)

State of Orissa and Ors. …..Appellants

Versus

Harapriya Bisoi ….Respondent

(With Civil Appeal  2657/2009 @ SLP (C) No.11960/2007)

J U D G M E N T

Dr. ARIJIT PASAYAT.

1. Leave granted.

2. Challenge  in  these  appeals  is  to the  order  passed by  a Division Bench of  the

Orissa High Court allowing the writ petition filed by the respondent in Writ Petition (C)

No.8282/2004  dated  27.10.2005  and  the  order  dated  10.1.2007  passed  in  the  Review

Petition No.13/2006 arising out of said writ petition.  

2. The background facts as highlighted by the appellants are as follows:

The  dispute  relates  to  an  alleged  lease  of  53.95  acres  of  land  executed  by

Hatapatta dated 25.1.1933 by erstwhile intermediaries i.e. Chakradhar Mohapatra and

Ramakrushna Mohapatra in favour of one Kamala Devi.  The respondent Harapriya

Bishoi claimed to be the successor in interest of Kamala Devi. Undisputedly, the alleged

Hatapatta is an unregistered document. The land is presently situated in the capital city

of Bhubaneswar in the State of Orissa.  The purported Hatapatta described the land as

being for permanent cultivation but as per records or rights published in 1930-31 the

land is classified as “uncultivable” within Anabadi Land. The land is further described

as Jhudi jungle i.e. bushy forest. The estate of intermediaries Chakradhar Mohapatra

and Ramakrushna Mohapatra  is vested in the State by virtue of a Notification dated

1.5.1954 issued under Section 3 of the Orissa Estate Abolition Act, 1951 (in short the

‘Act’).  In respect of the land in question the Orissa Estate Abolition Case 4 of 1970 was

registered. Originally the case was registered as OEA 18 of 1967 with OEA Collector,

Cuttack.  On transfer of certain villages from Cuttack district to Puri District, the case

was transferred to OEA Collector, Bhubneshwar and was re-numbered as OEA Case

No.4 of 1970.  

By order dated 6.1.1971 in the said OEA case the OEA Collector set aside the

disputed lease deed on the ground of not being genuine. The Collector found that since

the  lands  were  lying  fallow,  the  rent  receipts  were  not  genuine.   The  Ekpadia  or

Zamabandi Register in the Tahsil Officer had no mention of Kamala Devi as a lessee.

The lease was unregistered even though vast tracts of land were transferred. It was thus

held that the lease deed   was back dated and was created with the object of defeating the

purpose of the Act.  The said order dated 6.1.1971 was upheld by Additional District

Magistrate, Puri by order dated 28.5.1974.   

Between the period 1962 to 1973 settlement proceedings were carried out under

the  Orissa  Survey  and  Settlement  Act,  1958  (in  short  the  ‘Settlement  Act’).  By

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publication  dated  6.12.1973,  the  State  was  recorded as  the  owner/title  holder  of  the

entire land of 1056.8 acres under Khatian No.1076 of village Gadakana of which the

disputed land is a part. Further, by Revenue Department Notification No.13699-EA-1-

ND-1/74/R   published  in  the  Extraordinary   Gazette  No.371  dated  18.3.1974,  the

Government of Orissa notified that the intermediaries interest of all intermediaries in

respect of all estates other than those which have vested in the State have passed to and

became vested in the State free from all encumbrances.  

The order dated 28.5.1974 was challenged before the Orissa High Court by filing

OJC No.882 of 1974.  The High Court   by order dated 29.10.1976 directed the OEA

Collector, Bhubneshwar to examine the matter afresh by issuing notice to the lessor and

the lessee and also to  ensure that the interest of the State was protected.  Pursuant to the

order of the High Court dated 29.10.1976 remanding the matter to the OEA Collector,

the Collector heard the matter afresh and by order dated 24.4.1989 held that the lease

was entered into prior to 1.1.1946. But he found that the claimant was only in possession

of 7 acres of land and hence recommendation was made only for registering a settlement

in respect of such 7 acres of land. Significantly, the General Administration Department

(in short GA Department) was not brought on record in the proceedings.  The record

was then submitted to the Board of Revenue. By order dated 27.4.1991, the Board of

Revenue held that due enquiry had not been made as per the orders of the High Court in

the earlier writ petition and the matter was returned to the Collector for fresh enquiry.

Interestingly, the order of OEA Collector dated 24.4.1989 was challenged in OJC 2063 of

1992 in the High Court.  There was, however, no challenge to the order passed by the

Board of Revenue dated 27.4.1991. By order dated 2.11.1992 the High Court allowed the

writ petition being of the view that the finding of the Collector was to the effect that the

lease was not executed after 1.1.1946, so as to defeat the provisions of the Act. Therefore,

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the OEA Collector had no jurisdiction to proceed further in the matter.  Thus (a) the

determination of the extent of possession of the parties and (b) referral of the matter to

the Board of Revenue was beyond jurisdiction of the Collector. The High Court quashed

the order of  the Collector directing settlement of  portion of  the leased property and

declared the proceedings before the Board of Revenue to be non est.  

The High Court confined its order only to issue of jurisdiction and the scope of

power under Section 5(i) and there was no finding recorded regarding the genuineness

of the lease dated 25.1.1933.  Additionally, the GA Department of the State which is the

relevant Department under the Orissa Government Rules of Business was not a party in

the writ petition.  

After  the  death  of  Kamala  Devi,  her  purported  successor  Kishore  Chandra

Pattnaik filed a writ petition bearing No.OJC 15984 of 1997 praying for a direction to

the State to accept rent in respect of the disputed property. Again, the GA Department

was not arrayed as a party in the case at the time of filing of the writ petition.   The GA

Department was later arrayed as a party pursuant to the order dated 3.8.2000 passed in

said OJC. One Anup Kumar Dhirsamant  who was the Power of Attorney holder of

Kishore Chandra Pattnaik executed a sale deed dated 6.3.2000 covering 23.30 acres of

land  on behalf of the latter in favour of the present respondent who is also the mother of

Dhirsamant.   Thus,  the  respondent  came  into  the  picture  as  a  vendee  of  Kishore

Chandra Pattnaik who in turn is the son of Kamala Devi.  Kishore Chandra Pattnaik

claimed that the original power of attorney did not empower the holder to sell the land.

His  plea  was  that  the  aforesaid  sale  was  in  pursuance  of  a  forged  and interpolated

document.  The sale deed dated 6.3.2000 was an impounded document for evasion of

stamp duty.  On 8.4.2002, a Settlement Rent Objection case under the Settlement Act

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bearing  case  No.4013  of  2002  was  instituted  by  the  Assistant  Settlement  Officer,

Gadakna on the strength of the petition filed by GA Department for recording the case

land in favour of GA Department. The petition was allowed on 30.12.2002 in favour of

the GA Department. Against the said order, Settlement Appeal cases were preferred by

Kishore Chandra Pattnaik and present respondent Harapriya Bisoi. The appeals were

disposed  of  by  order  dated  7.10.2004  and  the  record  of  rights  in  favour  of  GA

Department was directed not to be interfered with. The respondent also filed a Civil Suit

bearing No.2/12 of 2004 before learned Civil Judge, Senior Division, Bhubaneswar, for a

declaration  of  right,  title  and  interest  in  respect  of  disputed  land.   The  IAs  were

dismissed  and  the  Civil  Court  held  that  the  right,  title  and  interest  of  the  present

respondent had not been determined finally by OJC 2063 of 1992. It was held that the

findings of the High Court related only to the power and jurisdiction of the Collector

and the Board of Revenue.  Respondent filed OJC 8282 of 2004 seeking a direction to the

State to accept rent from her in respect of the case land, for a declaration of tenancy in

her favour and for an injunction against the State restraining them from interfering

with her possession. By order dated 27.10.2005 the High Court allowed the writ petition

and that is the subject matter of challenge in one of the present appeals.   

It is to be noted that in its order dated 27.10.2005 the High Court relied upon the

earlier judgment in OJC 2063 of 1992 and held that in view of the finding in that case

Kamala Devi and Kishore Chandra Pattnaik were deemed to be tenants under the State

government under Section 8(1) of the Act and the present respondent being successor in

interest of Kamala Devi was to step into her shoes and has to be treated as a tenant

under the Act. The relevant findings of the High Court in the judgment are as follows:  

“(i) In  paras  10  and  11  of  the  judgement  of  the  High  Court  in  OJC  No. 2063/1992 it was held that the lease deed having been executed prior to 1.1.1946

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and the same have been found to be a genuine document, the OEA Collector could not have proceeded with the case any further and he should have dropped the proceeding.  

(ii) In the subsequent paras in the judgment in OJC No. 2063/1992, the Court held that the OEA Collector had no jurisdiction to decide the question of actual possession and make a recommendation to the Board of Revenue for concurrence. "The orders passed by the Board of Revenue in pursuance of the references of the case by the OEA Collector shall be taken to be non-est. The proceedings initiated under S. 5 (i) of the OEA Act shall be taken to have been dropped."  

(iii) This Court while disposing of the earlier writ application taking note of S. 5 (i) has held that Late Kamla Devi was a tenant under the ex-intermediaries before the vesting and on the date of vesting and was in possession of the entire disputed property - hence Late Kamla Devi was a deemed tenant under S. 8 (1) of the OEA Act.  

(iv) In view of the decision of the High Court in OJC No. 2063/1992, late Kamla Devi and thereafter her successor Kishore Chandra Pattnaik are deemed to be tenants under the State Government and therefore the Tahasildar, Bhubaneswar was duty bound to collect rent from them.  

(v)  Kishore  Chandra  Pattaik  being  deemed  to  be  a  tenant  under  the  State Government,  the,  Petitioner,  Harpriya  Bishoi,  has  stepped  into  his  shoes  after purchasing the land from him and, consequently, the Petitioner is to be treated as a tenant under the State and rent is to be collected from her.”  

4. In support of the appeals, learned counsel for the State submitted that the High

Court  has  completely  mis-construed  the  decision  in  OJC 2063  of  1992.  In  the  said

judgment the High Court had not returned any finding or expressed any observation

with regard to the genuineness of the lease deed of 1933. The only issue before the High

Court was whether the OEA Collector had exercised its powers correctly under Section

5(i) of the Act. No further issue was under consideration of the High Court.  Only the

scope and jurisdiction of the Collector and the Board of Revenue was decided. In the

said decision the High Court had not returned any finding that late Kamala Devi was a

tenant under the ex-intermediaries before the vesting and on the date of vesting and

was in possession of the entire disputed property.  The High Court has erroneously

recorded the said finding in the impugned judgment.  Therefore, the High Court was in

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error  by  holding  that  Kamala  Devi  and  thereafter  her  successor  Kishore  Chandra

Pattnaik were deemed   to be tenants under Section 8(1) of the Act. It is pointed out that

the proceedings in OEA Case No.4 of 1970 were under Section 5(i) of the Act and not

under Section 8(1) of the Act. Neither the order of OEA Collector in OEA Case No.4 of

1970 dated 24.4.1989 nor the High Court’s order in OJC 2063 of 1992 recognizes the

predecessors in interest of the respondent as tenants under Section 8(1) of the Act.  The

OEA Collector had categorically held in the order dated 24.4.1989 that the plea of the

claimants that the proceedings to be treated as one under Section 8(1) does not hold

water.   The  OEA  Collector  was  therefore  conscious  of  the  fact  that  there  was  no

exercise of power under Section 8(1) of the Act, but only under Section 5(i) of the Act.

Further, the High Court was in error in its interpretation of Section 5(i) of the Act. The

settlement of the lease in favour of the lessee under the first proviso of Section 5(i) has

to be necessarily confirmed by a member, Board of Revenue.  

5. It has also been highlighted that a decision of this Court in  State of Orissa v.

Brundaban Sharma (1995 Supp (3) SCC 249) has been completely lost sight of. The

conceptual different between Section 5(i) of the Act and Section 8 has been lost sight of.

It  was clearly observed in Brundaban’s case (supra) that the order of the Collector

under Section 5(i) of the Act is required to be confirmed by Board of Revenue even if

Collector  upholds  genuineness  of  the  lease.  Several  gross  acts  of  fraud  have  been

committed  by  the  respondent  and/or  others  involved.  This  clearly  invalidates  every

action.  The vendor’s claims are pending adjudication before various courts. The record

of rights has attained finality in the settlement proceedings and the High Court should

not  have  unsettled  them  in  the  manner  done.  Therefore,  it  is  submitted  that  the

impugned judgment of the High Court cannot be maintained.  

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6. On  the  other  hand,  learned  counsel  for  the  respondent  submitted  that

consequences  of  vesting and the finding of the Collector that the lease was prior to

1.1.1946 and is a genuine one has been confirmed in the earlier judgment. The same has

attained finality. The State of Orissa was represented by the Secretary to Government,

Revenue Department,  Bhubneshwar and the Member, Board of  Revenue was also a

party. It is submitted that the decision in Brundaban’s case (supra) was rendered in a

different set up and has no application to the facts of the present case.  

7. Certain factors need to be noted in the present case.

8. In Brundaban’s case (supra) this Court held that even in a case where the OEA

Collector “decides not to set aside the lease, he should have referred the case to the

Board of Revenue. The object of conferment of such power on the Board of Revenue

appears  to be  to  prevent  collusive  or  fraudulent  acts  or  actions  on the  part  of  the

intermediaries  and lower level  officers  to  defeat  the  object  of  the  Act.”  This  Court

further held that even if the OEA Collector decides that a lease was purported to have

been granted before 1.1.1946 and is  not  liable  to  be set  aside,  without  reference or

confirmation  by  the  Board  of  Revenue,  such  lease  would  not  attain  finality   The

judgment finally concludes that, "the' order passed by the Tehsildar (exercising powers

as the OEA Collector) without confirmation by the Board  is non est. A non est order is

a void order and it confers no title and its validity can be questioned or invalidity be set

up in any proceeding or at any stage."  

9. It is important to note, that in the facts of the present case, the Member, Board

of  Revenue in  its  order  dated  27.4.1991 while  considering  the  decision  of  the  OEA

Collector in OEA Case No. 4 of 1970, had observed that a detailed enquiry had not been

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made by the OEA Collector "to ascertain who was in possession of the case land prior

to 1.1.1946 and from 1.1.1946 to 1.5.1954 (date of vesting of estate) and thereafter". The

Member, Board of Revenue, had further stated that, "the OEA Collector should have

verified the records to ascertain who were the ex-intermediaries (lessors) and if  they

had right to alienate the land and if they have got compensation u/ s 28 of the OEA

Act". Further, "the O.Ps did not press their claim for a considerable period of time"

and "after notice was published in the newspaper 'Prajatantra' dated 22.7.87, a number

of interveners have preferred their claims before the OEA Collector", who have not

been examined.

10. The Member, Board of Revenue in its order had concluded that, "the case land

are within Bhubaneswar Municipality where the capital of state has been established

and a number of Government institutions have developed.. In view of the above points it

is necessary on the part of the OEA Collector to conduct a detailed enquiry”.

11. Without such confirmation by Member, Board of Revenue, the order of the OEA

Collector had not attained finality, and hence, the lease deed in favour of Kamala Devi

did not attain finality.

12. Certain provisions of the Act need to be noted.

13. Section 2(h) defines an `intermediary' as follows:

"Intermediary' with reference to any estate means a proprietor, sub-proprietor, landlord,  land holder,  malguzar, thikadar, gaontia,  tenure-holder,  under-tenure holder and includes an inamdar, a jagirdar, Zamindar, Illaquedar, Khorposhdar, Parganadar,  Sarbarakar  and  Maufidar  including  the  ruler  of  an  Indian  State merged with the State of Orissa and all other holders or owners of interest in land between the raiyat and the State."

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14. Section  2(hh)  defines  as  `intermediary  interest'  as  an  estate  or  any  rights  or

interest therein held or owned by or vested in an Intermediary.

15. Significantly,  as  the  above  definitions  would  show,  an  ‘intermediary'  and  an

`intermediary interest' cover all the holders or owners of interest in land between the

State and the 'Raiyat' i.e. the actual cultivator or tiller of the soil. This is in line with the

object and purpose of the 1951 Act i.e. to establish a direct relationship between the tiller

and the State, and to abolish all intermediary interests, by whatever name called.

16. ‘Raiyat' is the actual tiller of the soil, and is defined in section 2(n) as:

'Raiyat' means any person holding the land for the purpose of cultivation and who has acquired the right of occupancy according to the tenancy law or rules for the time being in force in that area or in the absence of such law or rules, the custom prevalent in that area.

17. Section 3 of the Act empowers the State to declare,, by notification, that the estate

specified  in  the  notification  has  passed  to  and  become vested  in  the  State  free  from all

encumbrances. In similar vein, Section 3A empowers the State to declare by notification that

the intermediary interests of all intermediaries or a class of intermediaries in the whole or

part of the estate have passed to and become vested in the State free from all encumbrances.

18. Upon a notification being issued under the provisions of Sections 3, 3A or 4 of the Act,

the entire estate vests in the State free from encumbrances and the intermediary ceases to

have  any  interest  in  such  estate  other  than the  interests  expressly  saved  under  the  Act.

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Where a lease or transfer has been made prior to 1.1.1946, solely with the object of defeating

the  provisions  of  the  Act  or  to  claim  higher  compensation,  Section  5(i)  empowers  the

collector to set aside such lease, settlement or transfer and take possession of the land from

such person.

19. By virtue of Section 8, any person who immediately before the vesting of an estate in

the State government was in possession of any holding as a tenant under an intermediary,

would on the from the date of the vesting, be deemed to be a tenant of the State government.

The  words  'holding  as  a  tenant'  mean  the  `Raiyat'  and  not  any  other  class  of  tenant:

Reference in this regard may be drawn to the definition of ‘holding' in the Orissa Tenancy

Act, 1913. ‘Holding’  means a parcel or parcels of land held by a raiyat and forming the

subject of a separate tenancy".

20. Section 8 thus confers protection only on the ‘Raiyat' i.e. the actual tiller of the soil.

21. Significantly, a ‘lease' and `lessee' on the one hand are defined separately from

the 'Raiyat' under the Act. Thus, the mere execution of a lease by the intermediary in

favour of  a person would  not confer the status  of  a 'raiyat'  on the lessee nor would

protect the possession of such lessee under Section 8. In fact, a `lease' would amount to a

transfer of an interest of the intermediary in the land to the lessee. In such a situation,

far from being a tenant protected under Section 8, the lessee would in fact step into the

shoes  of  the  intermediary  with  his  interest  being  liable  for  confiscation  and  his

entitlement limited to compensation from the State. On the other hand, for protection

under Section 8, one has to be a Raiyat cultivating the land directly and having the rights

of occupancy under the tenancy laws of the State. Thus, a `lessee' who is not actually

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cultivating the  land  i.e.  who  is  not  a  'raiyat',  would  not  be  within  the  protection  of

Section  8  of  the  Act.  Section  2(h)  of  the  Act  in  its  residuary  part  states  that

`intermediary' would cover all owners or holders of interest in land between the raiyat

and the State. In Kumar Bimal Chandra Sinha V. State of Orissa, (1963) 2 SCR 552, this

Court while considering the scope of the Act has held as follows:

"the position in law is that `estate" includes the interest, by whatever' name called, of all persons, who hold some right in land between the State at the apex and the raiyat at the base. That is to say, the Act is intended to abolish all intermediaries and rent receivers and to establish direct relationship between the State, in which all such interests vest, after abolition under the Act, and the tillers of the soil."

22. On the facts of the present case, it is clear that the land was not under cultivation

by Kamala Devi. As per the record of rights published in 1930-31, the disputed land is

classified as Anabadi Land i.e. uncultivable. The land is further described in the records

as Jhudi jungle,  i.e. bush forest. In addition, by order dated 6.1.1971 in OEA Case 4 of

1970, the OEA Collector, Bhubaneshwar had found that the lands were lying fallow and

were not in physical possession of any person. The land thus not being cultivated, Kamala

Devi cannot prima facie be considered as a 'Raiyat' under the Act.

23. It is the stand of the appellant-State that the 'Hatapatta' on the basis of which

Kamala  Devi  has  claimed  her  title  is  an  unregistered  document.  Section  107  of  the

Transfer of Property Act, 1882 (in short the ‘T.P. Act’) read with Section 17 of the India

Registration Act, (in short the ‘Registration Act’) mandates that the conveyance of title

through a written instrument of any immovable property worth more than Rs.100 for a

period of one year or more must be registered. If such an instrument is not registered

then Section 49 of the Registration Act read with Section 91 of the Indian Evidence Act,

1872 (in short the ‘Evidence Act’) precludes the adducing of any further evidence of the

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terms and contents of such a document. [See  Sri Sita Maharani  v.  Chhedi Mahto (AIR

1955  SC  328).  There  is  a  further  requirement  of  registration  of  the  instrument  of

conveyance/agricultural lease under Sections 15 and 16 of the Orissa Tenancy Act, 1913

(in short the ‘Tenancy Act’).  

24. It is further submitted that even presuming that the 'Hatapatta' is legal and valid,

it would, make Kamla Devi a 'tenure-holder' as opposed to a 'raiyat'. Section 2(h) of the

Act defines `intermediary' to include 'tenure-holder'. Thus, a "tenure holder" being an

"intermediary" under the  Act-  the  rights and liabilities  of  such tenure holder  would

stand extinguished under the Act.

25. According to the proviso to Section 5(5) of Tenancy Act where the area held by the

tenant  exceeds 33 acres  the tenant  shall  be  presumed to  be a ‘tenure-holder’  (which

includes  her  successors-in-interest)  until  the  contrary  is  proved.  As  under  the

‘Hatapatta’, purportedly more than 53.95 acres of land has been given by way of lease by

the ex-intermediary to Kamala Devi, she or her successor-in-interest is presumed to be a

‘tenure-holder’ and, therefore, an ‘intermediary’ under the Act.

26. It is highlighted by learned counsel for the appellant, as various claims on prime

government  land  in  the  city  of  Bhubaneswar  have  been  surfacing  on  the  basis  of

fraudulent  title  papers  (called  'Hatapattas')  allegedly  to  have  been  issued  by  ex--

intermediaries,  the State Government in the General  Administration Department,  has

handed over the issue of fraudulent 'Hatapattas' to the Crime Branch, CID, Cuttack for

inquiry and necessary legal action vide Capital Police Station Case No.178/2005 dated

20.5.2005. An interim report of the Inspector/CID-Crime Branch dated 31.8.2007 with

respect to the suit land has been submitted.  

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27. The Crime Branch Report states that the Power of Attorney through which the

suit land has been sought to be alienated in favour of the Respondent herein has been

tampered and manipulated by the Power of Attorney holder, Anup Kumar Dhirsamant,

Managing  Director,  M/s  Milan  Developers  & Builders  (P)  Ltd.  The  vendor,  Kishore

Chandra Pattnaik had not given any powers of alienation to his Power of Attorney holder

Anup Kumar Dhirsamant. The respondent Harapriya Bisoi is the mother of the Power of

Attorney  holder.  The  Crime  Branch  also  states  that  Anup  Kumar  Dhirsamant  had

interpolated the deed of Power of Attorney giving himself powers to enter into a sale deed

so as to be able to alienate the property in favour of his mother, Harapriya Bisoi, the

respondent  herein.  The  report  concludes  that  prima  facie  offences  u/s

420/468/471/477A/167/120B of the Indian Penal Code, 1860 (in short ‘IPC’), inter-alia,

have been made out against respondent Harapriya Bisoi and Anup Kumar Dhirsamant.

28. It has also come to light that the Sale Deed (RSD) No.1196/2000 dated 6.3.2000

executed in favour of Harapriya Bisoi, the Respondent herein, has been impounded for

non-payment of adequate stamp duty with the deficit stamp duty and registration fee

amounting to about Rs.1.03 crores.

29. In Settlement Rent Objection Case No. 4013/2002 under the Settlement Act, the

Asst. Settlement Officer by its order dated 10.3.2003 had recorded the suit land in favour

of the G.A. Department.

30. Thereafter, the Respondent filed Settlement Appeal Case, being Suit No. 205 of

2003, to set aside the above order. The Settlement Officer by its order dated 7.10.2004

had dismissed the appeal holding that the draft. Record of Rights in respect of the suit

land shall not be interfered with. The officer returned the following findings:

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(1)  On  perusal  of  the  impugned  order  passed  by  the  Asst.  Settlement

Officer  in  the  said  objection  case  it  is  revealed  that  necessary  field

enquiry was made in presence of the parties.

(2) It is observed that there exists no such field/plot as found in the not final

map in respect of suit land relating to Hal Plot Nos. 7590 Ac 3.000, 7592

Ac.3.400, 7626 Ac 1.940 and 7646 Ac.5.000 - the map in respect of those

plots are imaginary.

(3) The land relating to Hal Plot No. 7646 Ac 5.000 have been allotted to

Sainik School since the year 1962-63 and comes under the premises of

Sainik School.

(4)The  alleged  possession  of  suit  land  by  the  appellant  is  found  to  be

disputed with others like Dijabar Behera S/o Bhima Behera and Golakh

Behera S/o Kesab Behera.   

 (5) Besides, an area of Ac 2.300 dec. out of the suit land i.e. Sabik Plot No.

4706 along with its adjoining land to the extent of Ac. 39.399 dec. have

been leased to the Government of India, Ministry of Railways, for the

purpose of construction of office and residential complex of East Coast

Railway,  Bhubaneswar.  It  is  also  observed  by  the  Asst.  Settlement

Officer that no jamabandi in respect of the suit land has been opened in

the Tahsil records.

(6) The Appellant adduced no evidence as regards to acquiring of right,

title,  interest and possession over the suit  land which is  Government

land as per the finally published ROR of the year 1973-74.

(7) Creation of tenancy right in favour of the Appellant by way of deeming

provision  u/  s  8  (1)  of  the  Act  has  also  not  been  recognized  by  the

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Tahasildar,  Cuttack/Bhubaneswar;  the  claim  of  possession  by  the

appellant over the suit land is not confirmed.

31. In course of hearing of the appeals, a query was made as to what is the effect of

the order of the High Court in OJC 2063 of 1992 i.e. whether it covers the area of 7 acres

or the whole area of 53.95 acres of land.  Learned counsel for the respondent submitted

that in view of the finding that the order of the Collector was indefensible, obviously the

right, title and interest of the respondent extended to the whole area. This stand is clearly

unsustainable.  The Collector’s order only referred to certain enquires made to confirm

possession of only 7 acres of land. The High Court apparently has not considered this

aspect. The High Court has also not considered the effect of alleged fraud and the fact

that the relevant department was not a party in the proceedings before the High Court in

OJC 2063 of 1992.  

32. It is necessary to consider the effect of fraud.  

33. By “fraud” is meant an intention to deceive; whether it is from any expectation of

advantage to the party himself or from the ill will towards the other is immaterial.  The

expression  “fraud”  involves  two  elements,  deceit  and  injury  to  the  person  deceived.

Injury is something other than economic loss, that is, deprivation of property, whether

movable or immovable or of money and it will include and any harm whatever caused to

any person in body, mind, reputation or such others. In short, it is a non-economic or

non-pecuniary loss.  A benefit or advantage to the deceiver, will almost always cause loss

or  detriment  to  the  deceived.  Even  in  those  rare  cases  where  there  is  a  benefit  or

advantage  to  the  deceiver,  but  no  corresponding  loss  to  the  deceived,  the  second

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condition is satisfied.  (See  Dr. Vimla v.  Delhi Administration (1963 Supp. 2 SCR 585)

and Indian Bank v. Satyam Febres (India) Pvt. Ltd. (1996 (5) SCC 550).   

34. A “fraud” is an act of deliberate deception with the design of securing something

by taking unfair advantage of another.  It is a deception in order to gain by another’s

loss. It is a cheating intended to get an advantage.  (See  S.P. Changalvaraya Naidu v.

Jagannath (1994 (1) SCC 1).

35. “Fraud” as is well known vitiates every solemn act.  Fraud and justice never dwell

together.  Fraud is a conduct either by letter or words, which includes the other person

or authority to take a definite determinative stand as a response to the conduct of the

former either by words  or  letter.   It  is  also  well  settled that  misrepresentation itself

amounts  to  fraud.  Indeed,  innocent  misrepresentation may also give  reason to claim

relief  against  fraud.   A fraudulent  misrepresentation  is  called  deceit  and consists  in

leading a man into damage by willfully or recklessly causing him to believe and act on

falsehood. It is a fraud in law if a party makes representations, which he knows to be

false, and injury enures therefrom although the motive from which the representations

proceeded may not have been bad.  An act of fraud on court is always viewed seriously.

A collusion or conspiracy with a view to deprive the rights of the others in relation to a

property  would  render  the  transaction  void  ab  initio.  Fraud  and  deception  are

synonymous.  Although in a given case a deception may not amount to fraud, fraud is

anathema  to  all  equitable  principles  and  any  affair  tainted  with  fraud  cannot  be

perpetuated or saved by the application of any equitable doctrine including res judicata.

(See Ram Chandra Singh v. Savitri Devi and Ors. (2003 (8) SCC 319).

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36. “Fraud” and collusion vitiate even the most solemn proceedings in any civilized

system of jurisprudence.  It is a concept descriptive of human conduct.  Michael Levi

likens a fraudster to Milton’s sorcerer, Comus, who exulted in his ability to, ‘wing me

into the easy hearted man and trap him into snares’. It has been defined as an act of

trickery or deceit. In Webster’s Third New International Dictionary “fraud” in equity

has  been defined  as  an  act  or  omission  to  act  or  concealment  by  which  one  person

obtains an advantage against conscience over another or which equity or public policy

forbids as being prejudicial to another.  In Black’s Legal Dictionary, “fraud” is defined

as an intentional  perversion of truth for the purpose of inducing another in reliance

upon it to part with some valuable thing belonging to him or surrender a legal right; a

false  representation of  a matter of  fact whether by words or by conduct,  by false or

misleading  allegations,  or  by  concealment of  that  which  should  have  been  disclosed,

which deceives and is intended to deceive another so that he shall act upon it to his legal

injury.  In Concise Oxford Dictionary, it has been defined as criminal deception, use of

false representation to gain unjust advantage; dishonest artifice or trick. According to

Halsbury’s  Laws  of  England,  a  representation  is  deemed  to  have  been  false,  and

therefore a misrepresentation, if it was at the material date false in substance and in fact.

Section 17 of the Indian Contract Act, 1872 defines “fraud” as act committed by a party

to a contract with intent to deceive another.  From dictionary meaning or even otherwise

fraud arises out of deliberate active role of representator about a fact, which he knows to

be untrue yet he succeeds in misleading the representee by making him believe it to be

true.  The representation to become fraudulent must be of fact with knowledge that it

was false. In a leading English case i.e. Derry and Ors. v. Peek (1886-90) All ER 1 what

constitutes “fraud” was described thus: (All ER p. 22 B-C) “fraud” is proved when it is

shown that a false representation has been made (i) knowingly, or (ii) without belief in its

truth, or (iii) recklessly, careless whether it be true or false”.  But “fraud” in public law

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is  not  the same as “fraud” in  private law.   Nor can the ingredients,  which  establish

“fraud”  in  commercial  transaction,  be  of  assistance  in  determining  fraud  in

Administrative Law.  It has been aptly observed by Lord Bridge in Khawaja v. Secretary

of State for Home Deptt. (1983) 1 All ER 765, that it is dangerous to introduce maxims of

common law as to effect of fraud while determining fraud in relation of statutory law.

“Fraud” in relation to statute must be a colourable transaction to evade the provisions of

a statute.  “If a statute has been passed for some one particular purpose, a court of law

will not countenance any attempt which may be made to extend the operation of the Act

to something else which is quite foreign to its object and beyond its scope.  Present day

concept of fraud on statute has veered round abuse of power or mala fide exercise of

power. It may arise due to overstepping the limits of power or defeating the provision of

statute  by  adopting  subterfuge  or  the  power  may  be  exercised  for  extraneous  or

irrelevant considerations.  The colour of fraud in public law or administration law, as it

is  developing,  is assuming different  shades.   It arises from a deception committed by

disclosure of incorrect facts knowingly and deliberately to invoke exercise of power and

procure an order from an authority or tribunal.  It must result in exercise of jurisdiction

which  otherwise  would  not  have  been  exercised.  The  misrepresentation  must  be  in

relation to the conditions provided in a section on existence or non-existence of which the

power can be exercised.  But non-disclosure of a fact not required by a statute to be

disclosed may not amount to fraud.  Even in commercial transactions non-disclosure of

every fact does not vitiate the agreement.  “In a contract every person must look for

himself and ensures that he acquires the information necessary to avoid bad bargain. In

public law the duty is not to deceive.  (See Shrisht Dhawan (Smt.) v. M/s. Shaw Brothers

(1992 (1) SCC 534).

37. In that case it was observed as follows:

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“Fraud and collusion vitiate even the most solemn proceedings  in any civilized system of jurisprudence.  It is a concept descriptive of human conduct. Michael levi likens a fraudster to Milton’s sorcerer, Comus, who exulted in his ability to, ’wing  me into  the  easy-hearted  man and  trap  him  into  snares’”.  It  has  been defined as an act of trickery or deceit.   In Webster’s Third New International Dictionary  fraud  in  equity  has  been  defined  as  an  act  or  omission  to  act  or concealment by which one person obtains an advantage against conscience over another or which equity or public policy forbids as being prejudicial to another. In Black’s Legal Dictionary, fraud is defined as an intentional perversion of truth for the purpose of inducing another in reliance upon it to part with some valuable thing  belonging  to  him or  surrender  a  legal  right;  a  false  representation  of  a matter of fact whether by words or by conduct, by false or misleading allegations, or by concealment of that which should have been disclosed, which deceives and is intended to deceive another so that he shall  act upon it to his  legal injury.  In Concise Oxford Dictionary, it has been defined as criminal deception, use of false representation to gain unjust advantage; dishonest artifice or trick.  According to Halsbury’s Laws of England, a representation is deemed to have been false, and therefore a misrepresentation, if it was at the material date false in substance and in fact.  Section 17 of the Contract Act defines fraud as act committed by a party to a contract with intent to deceive another.  From dictionary meaning or even otherwise fraud arises out of deliberate active role of representator about a fact which he knows to be untrue yet he succeeds in misleading the representee by making him believe it to be true.  The representation to become fraudulent must be of the fact with knowledge that it was false.  In a leading English case Derry v. Peek [(1886-90) ALL ER Rep 1: (1889) 14 AC 337 (HL)] what constitutes fraud was described thus : (All Er p. 22 B-C)

‘Fraud is proved when it is shown that a false representation has been made (i) knowingly, or (ii) without belief in its truth, or (iii) recklessly, careless whether it be true or false’.”

38. This aspect of the matter has been considered  by this Court in Roshan Deen v.

Preeti Lal (2002 (1) SCC 100)  Ram Preeti Yadav v.  U.P. Board of High School and

Intermediate Education (2003 (8) SCC 311),  Ram Chandra Singh’s case (supra) and

Ashok Leyland Ltd. v. State of T.N. and Another (2004 (3) SCC 1).

39. Suppression of a material document would also amount to a fraud on the court.

(see Gowrishankar v.  Joshi Amba Shankar Family Trust (1996 (3) SCC 310) and S.P.

Chengalvaraya Naidu’s case (supra).

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40. “Fraud” is a conduct either by letter or words, which induces the other person or

authority to take a definite  determinative stand as a response to the conduct of  the

former  either  by  words  or  letter.   Although  negligence  is  not  fraud  but  it  can  be

evidence on fraud; as observed in   Ram Preeti Yadav’s case (supra).

41. In  Lazarus Estate Ltd. v.  Beasley (1956) 1 QB 702, Lord Denning observed at

pages 712 & 713, “No judgment of a Court, no order of a Minister can be allowed to

stand  if  it  has  been  obtained  by  fraud.  Fraud  unravels  everything.”   In  the  same

judgment Lord Parker LJ observed that fraud vitiates all transactions known to the law

of however high a degree of solemnity.  

42. There is another statute which has great relevance to the present dispute, i.e. The

Orissa Communal Forest and Private Lands (Prohibitions of Alienation) Act, 1948 (in

short ‘Communal Forest Land’).    

43. In Maganti Subrahmanyam (dead) by his Legal Representative v.  The State of

Andhra Pradesh (AIR 1970 SC 403) it was observed as follows:

“4. The purpose of the Act was to prohibit the alienation of communal, forest  and  private  lands  in  estates  in  the  Province  of  Madras  and  the preamble to the Act shows that it was enacted to prevent indiscriminate alienation of communal, forest and private lands in estates in the Province of Madras pending the enactment of legislation for acquiring the interests of landholders in such estates and introducing ryotwari settlement therein. No fixed duration of the Act was specified and it is impossible to hold that merely because of the above preamble the Act became a temporary Act. The definition of ‘forest land’ is given in Section 2(b) of the Act reading: ‘forest land’ includes any waste land containing trees and shrubs, pasture land and any other class of land declared by the State Government to be forest land by notification in the Fort St. George Gazette”.

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Sub-section  (1)  of  Section  3  prohibited  landholders  from  selling, mortgaging,  converting into ryoti  land,  leasing or otherwise assigning or alienating any communal or forest land in an estate without the previous sanction  of  the  District  Collector,  on  or  after  the  date  on  which  the ordinance  which  preceded  the  Act  came into  force,  namely,  27th  June, 1947. Section 4(1) provided that: “Any transaction of the nature prohibited by Section 3 which took place, in the  case  of  any  communal  or  forest  land,  on  or  after  the  31st  day  of October, 1939 ... shall be void and inoperative and shall not confer or take away, or be deemed to have conferred or taken away, any right whatever on or from any party to the transaction:

* * *” This  sub-section  had  a  proviso  with  several  clauses.  Our  attention  was drawn to clauses (iii), (iv) and (v) of the proviso but in our opinion none of these provisos was applicable to the facts of the case so as to exclude the operation of sub-section (1) of Section 4. Under sub-section (3) of Section 4: “If any dispute arises as to the validity of the claim of any person to any land under clauses (i) to (v) of the proviso to sub-section (1), it shall be open to such person or to any other person interested in the transaction or to the State Government, to apply to the District Judge of the district in  which the land is situated, for a decision as to the validity of such claim.”  Under sub-section (4) the District Judge to whom such application is made was to decide whether the claim to the land was valid or not after giving notice to all persons concerned and where the application was not made by the State Government, to the Government itself, and his decision was to be final. Madras Act 26 of 1948, was passed on April 19, 1949, being an Act to provide for the repeal of the Permanent Settlement, the acquisition of the rights of landholders in permanently settled and certain other estates in the Province of Madras, and the introduction of ryotwari  settlement in such estates. Apparently because of the preamble to the Act it was contended that with the enactment of the repeal of the Permanent Settlement by the Act  of  1948,  which  also  provided  for  the  acquisition  of  the  rights  of landholders in permanently settled estates, the Act stood repealed. We fail to see how because of the preamble to the Act it can be said that it stood repealed by the enactment of the later Act unless there were express words to that effect or unless there was a necessary implication. It does not stand to reason to hold that the alienation of large blocks  of land which were rendered void under the Act became good by reason of the passing of the later Act. Our attention was drawn to Section 63 of the later Act which provided that:

“If any question arises whether any land in an estate is a forest or is situated in a forest, or as to the limits of a forest, it shall be determined by the Settlement Officer, subject to an appeal to the Director within such time as may be prescribed and also to revision by the Board of Revenue.”

In terms the section was only prospective and it did not seek to impeach any transaction which was effected before the Act and was not applicable to transactions anterior to the Act. In our opinion Section 56(1) of the

22

later Act to which our attention was drawn by the learned counsel does not fall  for consideration in this case and the disputes covered by that section do not embrace the question before us.

5, Madras General  Clauses Act  1  of  1891,  deals with the effect  of repeals off statutes. Section 8, sub-section (f) thereof provides that: “Where  any  Act,  to  which  this  Chapter  applies,  repeals  any  other enactment, then the repeal shall not— (a)-(e) * * * (f) affect any investigation, legal proceeding or remedy in respect of any such  right,  privilege,  obligation,  liability,  fine,  penalty,  forfeiture  or punishment as aforesaid; and any such investigation, legal proceeding or remedy  may  be  instituted,  continued  or  enforced,  and  any  such  fine, penalty, forfeiture or punishment may be imposed, as if the repealing Act had not been passed.”  This shows that even if there was a repeal any investigation started before the repeal would have to be continued and legal proceedings under the Act could be prosecuted as if the repealing Act had not been passed.

6.  There  is  also  no  force  in  the  contention  that  unless  there  was  a notification under Section 2(b) of the Act declaring a particular land to be forest land, the applicability of the Act would be excluded. The definition of ‘forest land’ in that section is an inclusive one and shows that ‘forest land’ would include not  only waste land containing trees,  shrubs  and pasture lands but also any other class of lands declared by Government to be forest land. This does not mean that before a piece of land could be said to be forest land there would have to be a notification by the Government under the Act.”

44. In view of the aforesaid conclusions we are of the considered view that the matter

needs to be re-considered by the High Court.   

45. The High Court while re-hearing the matter shall also consider the effect of the

aforesaid observations of this Court, and various aspects highlighted above.

46. In the background of the massiveness of apparent fraud involved, effective and

participative role of officials of the State cannot be lost sight of.  Without their active and

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effective  participation  manipulation  of  records,  tampering  with  documents  could  not

have been possible.  The State would do well to persue the matter with seriousness to

unravel  the  truth  and  punish  the  erring  officials  and  take  all  permissible  actions

(including criminal action) against every one involved.     

47. The appeals are allowed to the aforesaid extent.  

………………………………….J. (Dr. ARIJIT PASAYAT)

……………………………………J. (LOKESHWAR SINGH PANTA)

New Delhi, April 20, 2009

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