http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 5  

PETITIONER: GULZARA SINGH

       Vs.

RESPONDENT: THE COLLECTOR, LUDHIANA & OTHERS

DATE OF JUDGMENT07/03/1995

BENCH: RAMASWAMY, K. BENCH: RAMASWAMY, K. VENKATACHALA N. (J)

CITATION:  1995 SCC  Supl.  (2) 253 JT 1995 (3)    26  1995 SCALE  (2)141

ACT:

HEADNOTE:

JUDGMENT: K.   RAMASWAMY, J.: 1.   The  lands bearing Khasra Nos. 75/ 10/2, 11, 12,  19/1, admeasuring 25 kanals 4 marlas along with other Nazool lands in  a total extent of 47 kanals 3 marlas situated  in  Bassi Gujjran, Tehsil Samrala, District Ludhiana, were granted  to the appellant by the Collector, Ludhiana, in File No.217  on June  27,  1968, subject to the appellant paying  a  sum  of Rs.1,520/- for redemption of the mortgage in respect of  the aforesaid 25 kanals 4 marlas of land.  Pursuant thereto, the appellant had deposited the aforesaid money with the Collec- tor  on June 30, 1968.  The appellant was put in  possession of  the  said land on September 11,  1968.   By  proceedings dated  September 13, 1968, the Collector cancelled the  said grant,  without notice to the appellant, on the ground  that the   respondents-mortgagees,  namely,  Fakir  Chand,   Prem Prakash and Gurdas Ram, were in possession and enjoyment for over  50  years  and they cannot  be  dispossessed  and  the property  cannot be redeemed by operation of the  provisions of  Redemption  of Mortgage (Punjab) Act, 1913  (for  short, ’the Act’) and redelivered possession to the respondents  on September 21, 1968. 2.   The   appellant  filed  Civil  Suit  No.204   of   1970 challenging  the  order cancelling  grant  and  redelivering possession of the lands to the respondents.  After adduction of evidence, the trial court considered the evidence adduced by  the parties and by judgment and decree dated  March  17, 1972,  decreed  the suit and, on appeal, it  was  confirmed. The High Court of Punjab & Haryana in Regular Second  Appeal No. 1506/75, though recorded 29 practically  all  the findings in favour of  the  appellant, holding  that  grant was valid and  cancellation  was  void, inoperative and does not bind appellant, allowed the  appeal and  reversed the decree for possession on the  ground  that mortgage was not redeemed in accordance with the  provisions

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 5  

of the Act.  Thus this appeal by special leave. 3.The  question  is  whether  the High  Court  is  right  in refusing  the relief of possession to the appellant.   Under Rule  2(d) of Government of Patiala and East  Punjab  States Union  Notification  dated May 28, 1956,  The  Nazool  lands (Transfer) Rules, 1956 (forshort, ’the Rules’) for grant  of Nazool lands have been made.  Rule 2(d) defines Nazool  land to  mean  (i)  "the land which has escheated  to  the  State Government  and  has not already been  appropriated  by  the State  Government for any purpose; (ii) such other lands  as the  State  Government may make available for  being  trans- ferred  under these rules".  Rule 3 provides  the  procedure for  transfer of Nazool land.  Clause (b) is relevant  which reads thus:-               "(b)   In  the  village  where   Nazool   land               available  is 10 acres or more, the  scheduled               castes  land-owing co-operative societies  may               be  formed  by the heads  of  scheduled  caste               families  in accordance with the  serials  and               the Nazool land may be allotted to them.  If a               co-operative  society cannot be  formed,  then               the  Nazool  land may be allotted  to  present               lessees,  i.e. members of a  scheduled  castes               individually up to the Unit of Nazool land  as               defined in the rules provided they do not  own               any  land  of their own.  Those who  own  some               land,  they may be allowed such area as  would               make up the Unit of Nazool land when added -to               their own area and the rest may be allotted to               other members of the scheduled castes." 4.   Under  these rules, the land granted by  the  Collector being  admittedly below 10 acres of land, the grant  of  the land  to the appellant was valid.  In this behalf,  all  the courts below concurrently recorded the finding in favour  of the  appellant.   This  was done in  implementation  of  the constitutional  mandate to render socioeconomic  justice  to the  Scheduled Castes.  As enjoined in the Preamble  and  in Article  46 of the Constitution, the Nazool lands vested  in the  State were granted and transferred’ to  the  appellant. Rule 3-A envisages the procedure regarding mortgaged  Nazool land.  It says thus :-               "3-A.  Mortgaged Nazool land - In the case  of               Nazool  lands  mortgaged with  possession  the               mortgagors  rights be transferred to  the  co-               operative  society of scheduled castes,  where               the  land  is 10 acres or more and to  be  the               individual  members of scheduled castes  where               it  is  less  than 10  acres,  in  the  manner               prescribed  in  rule  3(a)  and  (b)  and  the               mortgagors  should  pay the,  entire  mortgage               amount  which would be deemed as equal to  the               sale  price  of  the  land,  in  cases   where               mortgage money exceeds the price to be charged               by Government under rules.  Where the mortgage               amount  is less than the price to  be  charged               according to the rules, the difference between               the   two  amounts  should  be  paid  to   the               Government  and  the  mortgage  money  to  the               mortgagees.  " A  reading thereof clearly indicates that in the case  of  a Nazool  land  burdened with  possessory mortgage,  the  land would be transferred to Scheduled Castes Cooperative Society or  a member of Scheduled Castes as indicated in Rule 3  and the grantee was treated as mortgagor.  Thereby the right  of redemption  has been conferred on the grantee.  The  grantee

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 5  

should pay the entire mortgage amount which would 30 be deemed as equal to the sale price of the land.  In  cases where the mortgage money exceeds the price to be charged  by the  Government  under the Rules the same  should  be  paid. Where  the  mortgage  amount is less than the  price  to  be charged,  the difference between the mortgage money and  the price  charged  should  be paid to the  Government  and  the mortgage money to the mortgagee.  Thereby it would be  clear that the grant is subject to the payment of the price.   The mortgage money or the difference of the price was treated to be the price payable to the State and the mortgage money  is payable to the mortgagee.  In the light of the definition of the  Nazool land, since the land admittedly is escheat,  the lands stood vested in the State subject to the redemption of the mortgage.  Where Nazool land is burdened with possessory mortgage,  the State has the power either itself  to  redeem the  mortgage by paying the amount to the mortgagee  or  the grantee  would be entitled to redeem the mortgage by  paying the amount to the mortgagee. 5.   The  question emerges whether the Act, 1913,  would  be applicable  to the redemption of possessory mortgage of  the Nazool  land’?  The High Court and the courts below  clearly found  that in respect of the Nazool land "it is clear  from the  language of the Rule that the allottee is  required  to pay the mortgage money himself to the prior mortgagee".  But the  High  Court  found that he is required  to  redeem  the mortgage  by  following the procedure prescribed  under  the Act.  It also found that the Collector was not authorised to take  the price and redeem the mortgage.  Section 2 of  ’The (Government) Grants Act, 1895, provides that "nothing in the Transfer of Property Act, 1882, contained shall apply or  be deemed ever to have applied to any grant or other transfer o land or of any interest therein heretofore made or hereafter to  be  made  by or on behalf of the Government  to,  or  in favour  of any person whomsoever, but every such  grant  and transfer  shall be construed and take effect as if the  said Act had not been passed".  Thereby it is clear that for  any grant  and transfer of the land or of any  interest  therein and, in favour of, by and on behalf of the Government to  or in  favour  of  any  person whomsoever  for  such  grant  or transfer  the  provisions of the Transfer  of  Property  Act shall  not apply or be deemed ever to have applied  to  such grant  or  transfer  and that Act takes  effect  as  if  the Transfer  of  Property Act has not been passed.   Section  3 further   adumbrates  that  all  provisions,   restrictions, conditions and limitations over, contained in any such grant or  transfer  as aforesaid shall be valid  and  take  effect according  to  their  tenor, any rule  of  law,  statute  or enactment  of  the  Legislature  to  the  contrary  notwith- standing.  In other words, notwithstanding any rule of  law, statute  or  enactment of the Legislature  contrary  to  the provisions,  restrictions, conditions and  limitations  con- tained  in  any such grant or transfer, shall be  valid  and take  effect  according to the tenor.  It would  thereby  be clear  that not only that the provisions of the Transfer  of Property  Act should not apply to such grant or transfer  of land,  the  operation  of  any rule of  law  or  statute  or enactment  of the State Legislature including the Act  stand excluded  to  the  grant or transfer  of  the  Nazool  land. Section  3 clearly manifests that the operation of  the  Act stands  excluded, Therefore, the need for the  appellant  to follow the procedure prescribed under the Act was  obviated. The  question then is whether the appellant is  entitled  to pay  the  amount  as directed by  the  tenor  or  conditions

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 5  

mentioned in the letter of grant 31 or  transfer  of  the  Nazool land?  It  is  seen  that  the appellant  had paid the said amount on June 30,  1968.   The order  of cancellation indicates that the  cancellation  was effected solely on the premise that the respondents were  in possession and enjoyment as a possessory mortgagees for over 50  years  and  that, therefore, it  would  be  improper  to dispossess them from the Nazool lands.  The question emerges whether  the  payment  of  the  amount  as  ordered  by  the Collector  and  thereby the lands stood redeemed  under  the Rules is within the limitation prescribed in that behalf? it is  true  that though the escheat land stood vested  in  the State,  the escheat land burdened with  possessory  mortgage was  differently treated by Rule 3-A.  In other  words,  the Rule  indicates that despite vesting of the land as  escheat for  the lands burdened with possessory mortgage, the  State is burdened with the right to redeem the land by paying  the redemption money by itself or by the grantee or  transferee. The  grant  or transfer for such land was  for  price.   The mortgage  money  was treated to be the price.   In  case  of excess,  the  difference between the: price  fixed  and  the mortgage  money was to be paid to the State.  In this  case, admittedly, the price fixed was the money payable under  the mortgage  which amount was deposited by the appellant.   The Limitation  Act, 1918, prescribed 60 years for the State  to redeem the mortgage but The Limitation Act, 1963, prescribed 30 years which had come into force with effect from  January 1,  1964.   Section 30 of the Limitation Act  provides  that where  limitation given in the old Act has been  reduced  by the new Act, the suit would be filed within five years  from January 1, 1964.  By further amendment, by Act 10, 1969, the period  of  five  years was extended to  seven  years.   The period  o  limitation  for redemption of  the  mortgage  was extended up to 1971.  Since the grant of the Nazool land was made in 1968 and amount was deposited on June 30, 1968,  the appellant  had lawfully redeemed the mortgage by paying  the amount as contained in the order of grant.  The counsel  for the respondent candidly conceded in the appellate court that the redemption was within limitation but contended that  the procedure prescribed under the Act had not been followed and by  the date of suit it was barred and that, therefore,  the payment by the appellant was not in accordance with law  and the mortgage was not redeemed as per the law as on the  date of  the  suit.  That finding, though was  negatived  by  the appellate  court, it was found favour with the  High  Court. In  view  of  the fact that the State itself  has  right  to redeem   the  Nazool  land  burdened  with  the   possessory mortgage,  the  grant  of  the  same  land  subject  to  the redemption, the grantee gets the right of redemption  within limitation  available to the State.  That could be in  terms of the order, namely, making the payment to the mortgagee or deposit  with the Government.  Since the order  specifically postulates payment with the government and the same had been paid, the need to follow the procedure prescribed under  the Act has been obviated not only by operation of Section 3  of the  (Government)  Grants Act but also by the terms  of  the grant or transfer of the Nazool land. 6.   The  High Court, therefore, was not right  in  refusing the relief of possession to the appellant.  Accordingly, the judgment and decree of the High Court is set aside and  that of  the trial court is confirmed as prayed for.  The  appeal is accordingly allowed with costs throughout. 33

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 5