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PETITIONER: HOPE PLANTATIONS LTD.

       Vs.

RESPONDENT: TALUK LAND BOARD PEERMADE & ANR.

DATE OF JUDGMENT:       03/11/1998

BENCH: K.T. THOMAS, D.P.WADHWA, & SYED SHAH MOHAMMED QUADRI.

ACT:

HEADNOTE:

JUDGMENT: J U D G M E N T --------------- D.P. Wadhwa, J. -------------- This is the second round of litigation.  Earlier, it was the Taluk Land Board and the State of Kerala  which  had come to  this  Court  in  appeal  [CA No.  227/78 decided in batch of appeals in Chettain Veetil Ammad & Anr.  vs.  Taluk Land Board & Ors.  (1980 (1) SCC 499)] on  the  question  of exclusion   of  ’fuel  area’  and  ’rested  area’  from  the plantation which is otherwise exempt from the limitation  of "ceiling  area"  under  the  provisions  of  the Kerala Land reforms Act, 1963 (for short ’the Act’).  Present  appellant had purchased the estate mainly of tea plantation from South India Tea  Estate  Company Ltd.  which was the respondent in the earlier appeal in this Court.  (CA 227/78). The Act came into force on April 1, 1964. The Kerala Land  Reforms  (ceiling) Rules, 1970 (for short ’the Rules’) have been framed under the Act, which prescribed the Form in which the return/statement is required  to  be  filed  by  a person  having  land  in  excess of the "ceiling area" fixed under the Act or claiming  exemption  of  any  land  as  not falling within the ceiling area at all. Predecessor-in-title  of  the appellant (South India Tea Estate Company Ltd.) filed  return  on  March  28,  1970 before  the Land Board in relation to tea plantation held by it.  (Hereinafter when we refer to  the  appellant  it  will mean  and  include  its predecessor-in-title as well.) Total area of the land held by the  appellant  is  4251.19  acres. Out  of  this  an  area  of  267.16  acres  was sought to be surrendered.  From the area held by the appellant it claimed exemption under four heads, namely, (1) Tea  Plantation  (2) Roads  &  Building;  (3)  Area for Fuel Trees; and (4) Other agricultural lands interspersed.  By order  dated  June  25, 1976  Taluk Land Board disallowed substantial claims of thee appellant for exemption as  ’fuel  areas’  and  ’rested  tea area’.   Matter  was taken up by the appellant to the Kerala High Court in revision which by order dated March  15,  1977 restored  the  claims  made by the appellant under those two heads and under the heads ’Roads and Buildings’  and  ’Other

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Agricultural Land interspersed’ and remanded the case to the Taluk  Land  Board for re-determination of the ceiling area. The Taluk Land Board and the  State  of  Kerala  which  felt aggrieved  appealed  to  this  Court regarding the claims of exemption under the heads ’fuel area’ and ’rested tea area’. This Court by judgment dated May 2, 1979 allowed the  appeal and restored  the  orders  of the Taluk Land Board.  We will have occasion to refer to  this  judgment  in  detail  at  a subsequent stage   of  this  judgment.    No  final  orders, however, could be passed by the Taluk Land Board  under  the Act  as it remained seized of the matter under the two heads on which High Court had remanded the matter. Analysis of the orders of the Taluk Board and of the High Court are best reflected as under: On remand Taluk Land Board again took up the  matter after  judgment  of this Court dated May 2, 1979 in Chettian Veeti Ammad & Anr.  vs.  Taluk Land Board and  Ors.    (1980 (1) SCC 499).  In the proceedings pursuant to the remand the Taluk  Land  Board  considered  the question of interspersed agricultural land as the appellant had now pitched its claim on that basis as well.  Equally the appellant  claimed  that there  were  cardamom  plantation within the fuel area which existed and which dated back prior  to  April  1,  1964  and which would also be exempt.  It also claimed that the rested tea area  would, in fact, fall within tea plantation.  Taluk Land Board by order dated July 26, 1980 decided  the  matter in favour  of  the  appellant.    Chairman of the Taluk Land Board, however, dissented as according to him stand  of  the appellant  regarding ’rested tea area’ and ’fuel area’ stood concluded by the decision of the  Supreme  Court  aforesaid. Aggrieved,  now  the State of Kerala challenged the order in the Kerala High Court in revision.  By order dated  November 6,  1984  High  Court  set aside the order of the Taluk Land Board as regards the ’fuel area’  and  ’rested  area’.    It negatived  the  plea  of  the  appellant  that there was any plantation of cardamom within the fuel area existing earlier to April 1, 1964.  High Court also set aside the finding  of the  Taluk  Land Board as regards the claim of exemption for the lands interspersed within the boundaries of the area  of plantation with plantation crops and directed the Taluk Land Board  to  re-determine  the question afresh if it fulfilled the requirement of Section 2(44) of the Act and also keeping in view the observations made in the judgment.  High  Court, however,  did  not  interfere with the decision of the Taluk Land Board as regards "Land necessary  for  road,  building, factory store, etc." Now the break-up would be as under:- The appeal filed by the State against  earlier  order  dated March  15,  1977 of the High Court came to be decided on May 2, 1979 along  with  many  other  appeals  from  he  various judgments  of  the  Kerala  High  Court  and  is reported as Chettian Veetil Ammad & Anr.  Vs.  Taluk Land Board and ors. (1980 (1) SCC 499).  This court was considering a  group  of appeals  arising  from  various judgments of the Kerala High Court relating to the implementation of provisions  for  the restriction of ownership and possession of land in excess of ceiling  area  and  the  disposal  of  excess land under the provisions of the Act. This  Court  noted  that  there  were three  points of controversy and gave its decision. However, none of those points were concerned in the appeal  filed  by the Taluk Land Board (CA 227/78). After giving answer to the questions this COurt examined individual appeals and dealing with  the  appeal  in  the case of the appellant, it held as under:         "The  controversy  before us relates to exclusion of         "fuel area" and "rested  area".    The  Company  has

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       claimed  that  it  has  planted  red  gum as fuel in         924.01 acres as it was required for the "manufacture         of tea".    The  Taluk  Board  found  it  to  be  an         exorbitant  claim  and  reduced it to 200 acres, but         the High Court has restored the  entire  claim.  The         General  Manager  of  the  Company  has  stated that         firewood is being supplied to the employees free  of         cost.  So  the  claim  to  plant red qum all over is         belied by its General Manager’s statement.  Moreover         supply  of  fuel wood cannot be said to be a purpose         "ancillary to the cultivation of plantation  crops".         The   Land   Board  has  disallowed  the  claim  for         exemption of 136.17 acres, but it has ben allowed in         full by the High Court. Here again  the  High  Court         was  not  justified  in interfering with the Board’s         finding of fact for there was nothing to  show  that         it  was  an area from which crop was not gathered at         the relevant time. If that had  been  so,  it  might         have  been an area within the plantation. In fact it         appears from the order of the Board  that  no  other         estate  had  made  any  such  claim.  The  appeal is         therefore allowed to the  extent  that  the  Board’s         decision is restored in both these matters." Under Section  2  (44)  of  the  Act  when  land  is principally  used  for  cultivation  of  tea, coffee, cocoa, rubber, cardamom or canniamon, it would  be  plantation  and the  term  ’plantation’  also  includes  agricultural  lands interspersed within the boundaries of  the  area  cultivated with  plantation  crops,  namely, tea, coffee, cardamom etc. and the extent of this area is to be determined by the  Land Board  or  Taluk  Land Board as necessary for the protection and efficient management of the  cultivation  of  plantation crops.   The  term  ’plantation’ also includes land used for the purpose ancillary to the cultivation of plantation crops or even for the preparation of the same for the market which also  means  lands  used  for  the  construction  of  office buildings,   godowns,   factories,   quarters   for  workmen hospitals schools and play  grounds.    Under  Section  2(3) ’ceiling  area’  means  the  extent  of land specified under Section 82 as the ceiling area.  Section 82  prescribes  the ’ceiling  area’  up  to  which  a  person can hold the land. Section 81 exempts certain lands which may not  fall  within the limits  of  the ceiling area.  Plantation, as defined in Section 2(44), is exempt from  the  rigour  of  the  ceiling area.    Sub-section   (3)   of   Section  81  empowers  the Government, in public interest, to  exempt  any  other  land over  and  above  the  ceiling  area  and  subject  to  such restrictions and conditions as it may deem  fit  to  impose. Section  83  prohibits  any person from owning or holding or possessing land in excess of the ceiling area. Under Section 85 where a person owns  or  holds  land  in  excess  of  the ceiling  area, he is required to file a statement before the Land Board in the Form prescribed wherein he is to  indicate the  lands  prroposed  to  be surrendered. Under sub-section (5), the statement so filed is to be transferred by the Land Board to the Taluk Land Board to verify the particulars  and then  by  order  to  determine the extent of identity of the land which is surrendered. Under sub-section (9), Taluk Land Board on certain conditions existing and  at  any  time  has powerr  to  set  aside  its  order  made  under sub-section. Sub-section (9A) which was  inserted  by  the  Amending  Act w.e.f.  May 30, 1989. Taluk Land Board has been given powers to review its decisions. Statement/Return under sub-section (2) of Section 85 is required  to  be  filed  in  Form  1 under rule 4.  Pules

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further prescribe as to how  the  statement  will  be  filed before the Land Board and then transferred to the Taluk Land Board,    its   verification   as   to   ascertainment   and determination of the extent and identity of the  and  to  be surrendered  publication  of  draft statement and service of draft statement on persons interested; enquiry to  determine extent  and identity of the land surrendered; and such other matters. Statement under Section 85(2) in form No.1 requires various particulars. requirements  under  Clauses  (10)  and (11) of statement are:         "(10)  (a) Is any land included in annexure A in the         possession  of  other  persons by way of mortgage or         otherwise and if so,               (b)   have  particulars  of  such  land   been         furnished in Annexure E?         (11) (a) Is exemption claimed under  Section  81  of         the  Act in respect of any land included in Annexure         A, and if so,               (b)    have  particulars  of  such  land  been         furnished  in  Annexure F and statement under rule 6         in respect of plantation, if any, been attached?" Under Annexure A particulars of all lands  owned  or held  or  possessed  under  mortgage  on  1.1.1970 are to be furnished. This annexure is divided into  various  sections. Under  section  1,  particulars  of  land  held as owner are required to be given. Under Sections 2 and  3  respectively, particulars  of  land held as mortgagee and as tenant are to be given. Under Rule 6 any person claiming exemption under the provisions of Chapter III of the Act on the ground that  any land  owned  or  held  by  him  or  possessed by him under a mortgage is a plantation, shall furnish to  the  Land  Board statement showing the following particulars namely:-         "(a)   description  of  land (with details of survey         number, if surveyed, taluk and village), used by the         person principally of the cultivation of  the  crops         referred to in section 2 (44);         (b)   boundaries of the land;         (c)  extent of the land:         (d)    description  of  the crop or crops raised and         extent of land on which such crops are raised;         (e)   description  and  extent  of  the  land  (with         details  of  survey  number,  if surveyed, taluk and         village)  used  by  the  person  for   any   purpose         anciliary to the cultivatin of the crops referred to         in section 2 (44) or for the preparation of the same         for the market;         (f)    purpose  for  which  the land referred tto in         item (e) is used; and         (g)  description and extent  of  agricultural  lands         (with  details  of survey numbers, if surveyed taluk         and village) interspersed within the  boundaries  of         the  area  cultivated  by  the person with the crops         referred to in section 2(44) and the extent of  such         lands  which  the person considers necessary for the         protection  and   efficient   management   of   such         cultivation. Taluk  Land  Board in its order dated July 26, 1980, made after the  remand,  found  that  out  of  924.01  acres claimed  by the appellant as fuel clearing area for firewood for tea manufacture,  an  area  of  421.88  acres  contained Cardamom  plantation  which  had been planted prior to 1964. Taluk Land Board was of the view that the  remaining  302.21 acres  out of 924.01 acres should also be exempted as it was satisfied that the area  earlier  claimed  was  interspersed

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with  cardamom  plantation. But because it was first claimed as fuel clearing area, the interspersed area  could  not  be taken over. It, thus, exempted whole of 924.01 acres holding that  it  could  not  be treated as surplus land. There have been Eucalyptus trees growing in whole of this area. On the question of claim of the appellant  regarding 136.17 acres as ’rested tea area’, reference was made to the observation  of the Supreme Court where this Court said that if plucking was carried on in the said  land,  it  would  be included within  the plantation.  Taluk Land Board held that in view of the affidavit dated February 5, 1980 filed by the appellant before it and on its local inspection  there  were tree  plants  more  than  60 years old in the area of 136.17 acres and to that effect there was  also  a  certificate  of United  Planters’  Association  of  southern  India (UPASI). Taluk Land Board, therefore, exempted this  area  of  136.17 acres under  ’rested  tea’  as  part  of the plantation.  Of these two points, i.e., fuel clearing area of  924.01  acres and  rested  tea area of 136.17 acres, decision of the Taluk Land Board was by majority with the  Chairman  wwho  is  the official  member  of the Board dissenting on the ground that these questions could not be re-opened  by  the  Taluk  Land Board  after  the decision of the Supreme Court dated May 2, 1979. On the other two heads, namely,  the  area  of  202.55 acres  under  roads  and  buildings and other area of 263.63 acres  as  agricultural  lands   interspersed   with   other plantation  crops  as claimed by the appellant, the decision of the Taluk Land Board was unanimous. High  Court,  in  the revision filed by the State of Kerala, agreed with the Taluk Land  Board  that it could not go into the question of ’fuel area’ and ’rested  tea  area’  after  the  decision  of  the Supreme  Court.  Appellant was held entitled to 200 acres of land only as fuel area. High Court upheld  the  decision  of the  Taluk  Land  Board  on  the  claim of the appellant for 202.55 acres of land under  Building  sites  and  roads.  As regards  263.80  acres  of land (claimed by the appellant as interspersed with cardamom) High  Court,  however,  remanded the  matter  to  the Tribunal to decide the question afresh. High Court upheld the contention  of  the  State  Government that in the return earlier filed by the appellant it had not claimed  any  land  under  Cardamom  plantation  and as such exempt from vesting and that appellant was not  entitled  to get  exemption  on  any  ground other than that shown in the statement. This Order of the High Court  dated  November  6, 1984 has now been challenged before us by the appellant. The questions which arise for consideration are with respect  to  the claims of the appellant for exemption under the following heads :         1.    136.17 acres as rested tea area (disallowed by         the High Court);         2.     out of 924.01 acres (earlier claimed as  fuel         area) 421.88 acres as Cardamom plantation and 302.13         acres  as  other agricultural land interspersed with         other  plantation  crops  (disallowed  by  the  High         Court); and         3.      263.63  acres  as  other  agricultural lands         interspersed with cardamom crops  (remanded  by  the         High Court).      During  the  course  of hearing, this Court on July 15, 1985 passed the following order:         "Without prejudice to the rights and contentions  of         the  parties,  we  direct  that  the  Cardamom Board         established under Section 4  of  the  Cardamom  Act,         1965, will appoint one of its Senior Expert officers         to inspect the area of 924 acres said to be cardamom

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       plantation   who,   after  inspection,  will  submit         plantation who,  after  inspection,  will  submit  a         report  to  this  Court on the question of existence         extent of area and age of  the  cardamom  plants  in         that  area  (since  it  is  stated  before us by the         counsel for the  petitioners  that  cardamom  plants         could be of the age varying between 20 to 40 years).         We  also  direct that the said officer will take the         assistance  and  help  of  an  appropriate   revenue         officer  to be appointed by the Collector of Iddikki         in  the  matter  of  inspection  and  submission  of         report.  The  inspection  is  to be undertaken after         notice to both sides, whose representatives will  be         at  liberty to remain present at the inspection. The         report should be submitted to this Court within four         months from today. Such inspection and  report  will         initially  be  at  the  cost  and  expenses  of  the         Petitioners.              Matter to be placed on Board after the  receipt         of the Report."      Cardamom Board submitted its report accepting the claim of  the  appellant  as  to  the  existence  of  the Cardamom plantation prior to 1964 in the area of 421.88 acres.  State Government,  however, filed objections to the report stating that it could not be valid under the circumstances. Mr. Salve, learned counsel for tthe appellant,  made following submissions :- 1.    Statement/return,  which  was  filed  in  Form-1.  was without  prejudice  and  this  fact  find  mention  in   the statement  though  it  was also mentioned that the appellant was engaged  exclusively  in  producing,  manufacturing  and marketing  tea  and  all the lands held by the appellant was for that purpose. The statement showed as to  how  exemption was being claimed for the lands under Section 81 of the Act. 2.  At the time when statement was filed, position of law in relation to interpretation of material provisions in the Act was not  very  clear.   there was an order of the State Land Board (with supervisory powers over Taluk Land Boards) dated 29.3.1974 granting exemption to fuel areas as lands used for ancillary purposes to the extent of 16,899 acres for  a  tea area of 23,239 acres under the Kanan Devan hills (Resumption of Lands)  Act.    The ratio of fuel area worked out to 2:3. On that basis the chunk of land was  claimeed  by  appellant aas  fuel  area,  when a a matter of fact, appellant wrote a letter  dated  18.10.1974  to  Special   Tehsildar,   (Taluq Officer)  Peermade,  pointing out that the fuel areas of the appellant was used for the purpse ancillary  to  cultivation and  sought to justify the entir extent of 924 acres claimed to be bona fide use as fuel areas. 3.In that very letter which  the  appellant  wrote  on 18.10.1974 it was stated that "the lands interapersed within the  tea  efficient management of the plantation and for the preservation of the same.  Regarding the last para  of  your letter,  there  has  been  no  conversion  of  any land into plantation since 1.4.1964.   However,  we  have  planted  up cardamom in  some  of  our fuel lands.  The lands so planted with cardamom are now exempt as cardamom plantation and also as land ancillary to plantation coming within the definition of plantations." In the affidavit dated May 31,  1976  filed by  the  appellant  before  the  Taluk  Land  Board,  it was mentioned that there  were  agricultural  lands  within  the boundaries  of  the  tea plantations which were required for the protection and efficient management  of  plantation.  In that,  there  were also fuel plantations interspersed within the tea plantations.

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4.     Under Section 2(44) of the  Act,  agricultural  lands interspersed  within  the  boundaries of the area cultivated with plantation crops, not exceeding such extent as  may  be determined by the Land Board as necessary for the protection and  efficient management of such cultivation was treated as plantation for exemption  from  the  ceiling  area.  At  the material  time  when  the  Taluk Land Board made order dated June 6, 1976, it was not  competent  to  examine  the  claim regarding land interspersed with plantation crops. It was on that  account  the  question had been remanded to State Land Board for determination. But after the Act  was  amended  by Amending Act 27 of 1979 w.e.f. 7.7.1979 Taluk Land Board was also empowerred to examine the claim in question. Taluk Land Board,  therefore,  could  rightly go into this question all over again irrespective of  the  earlier  proceedings  which culminated up to Supreme Court (CA No. 227/78). 5.        The  proposition  of  law laid down that fuel wood supply to the employees cannot be said to be  for  ancillary purpose,  is no longer good law in the light of the decision of the three learned Judges of this Court in Pioneer  Rubber Plantation  vs.  State  of Kerala & Anr. [(1992) 4 SCC 175]. Although  that  decision  is  under  Kerala  Private  Forest (Vesting  & Assignment) Act, construing a similar provision, this Court has taken the view that land used for  fuel  area is used for ancillary purpose. This Court has observed thus:         "we  agree  with  the  learned  Judges of the larger         Bench of the Kerala High Court that it would not  be         in  accordance  with  the legislative intent to read         the provisions in question  without  regard  to  the         purpose  for  the preeparation of such crops for the         market.  Bearing  in  mind  that,  in  granting  the         exemption,  it  was  the  legislative  intent not to         disregard the legitimate interests of  the  estates,         namely,  their  efficient functioning as an industry         engaged in the  production  of  cash-crops  and  the         welfare  of the concerned employees, it is necessary         that a liberal and purposive construction should  be         put on the section." 6.   As to what is rested area’ reference may be made to (1) Tea Encyclopedia of the Indian Tea  Association,  Scientific Department, (2)  Tea  Planting in Ceylon by E.C.  Elliot and F.J.  Whitehead and (3) Indian Tea by Claud Bald.    Resting of tea  is  part  of  tea  plantation.   Certain area in tea plantation are rested temporarily with the  ultimate  object of  increasing the vigour and productive capacity of the tea bush. As to what  is  resting  tea  area  was  not  properly projected  before  this  Court  in  the  earlier  appeal (CA 227/78). 7.   Taluk Land Board, while it was seized of the matterr on remand could reopen the whole  case,  when  it  was  pleaded before it in the affidavit dated 18.2.1980 that 421.88 acres of  land  contained  Cardamom  plantation  coming within the definition of ’plantation’ by virtue of Section 81(1)(e)  of thee Act  etc.    Principle  of  resjudicata  cannot be made applicable  in  these  proceedings  as  it  is  a  case   of expropriatory law.    Civil  law  principles of res judicata cannot be invoked unless Taluk Land Board  passess  a  final order  and  if  in  the course of proceedings whether during remand or otherwise, it is found that  the  area  is  exempt under  any  provision  of  law, any acquisition of that area would be illegal and viod.  Proceeding terminate  only  when there  is  order under Section 85 of the Act which order had yet not been passed.  There can also be  no  plea  of  issue estoppel  raised  by the respondents in the circumstances of the case.  Reference  in  this  connection  was  made  to  a

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decision  of English House of Lords in Arnold and others vs. National Westminster Bank Plc. (1991 (2) AC 93). 8.      Report has since been filed by the Cardamom Board. A persual of the report shows  that  the  Cardamom  Board  has accepted  the  majority view of the Taluk Land Board as well as the stand  of  the  appellant  that  Cardamom  plantation existed  prior to 1964 and, therefore, the Cardamom area was exempted from the provision of the Act. 9.     Taluk Land Board has power under sub-section (9A0  of Section 85 to review its own decision. This could be done on the  ground  that earlier decision had been made "due to the failure  to  purduce  relevant  data  or  other   particular relating   to  ownership  or  possession  before  it  or  by collision or fraud or any suppression of material fact".  In the  present  case,  there  was  failure  on the part of the appellant to produce  relevant  data  regarding  fuel  area, rested tea and Cardamom plantation.      Mr.  P  Krishnamurthy,  learned  senior counsel for the respondent, in reply, made the following submissions: (1) After the decision of the Supreme Court in appeal by the Taluk Land Board (CA 227/78), its jurisdiction was barred on two items, namely fuel area and rested tea  area.  Reference was  made  to  three  decisions  of  the  Supreme  Court  on application of  the  principles  of  res  judicata,  namely, Devilal  Modi,  Priprietor,  M/s.  Daluram Pannalal Modi vs. Sales Tax Officers, Ratlam & Ors. (1965) 1 SCR 686]; Forward construction company  &  Ors.  Vs.  Prabhat  Mandal  (Regd.) Andheri  & Ors. (1986 (1) SCC 100] and Y.B. Patil & Ors. vs. Y.L. Patil [AIR 1977 SC 392]. 2.    In the statement filed  in  Form  1,  it  was  nowhere mentioned  that  there was any Cardamom plantation. If there is Cardamom cultivation, it has to come within  the  meaning of  the word ’plantation’ and it is not required to refer to the inclusive definition in clause (c) to  apply.  When  the matter  was  taken up second time by the Tluk Land Board, no correction in the original return was  sought  but  only  an affidavit  was  filed.  There  was then local inspection and second order of Taluk Land Board,  was by majority with  the Chairman dissenting. Lot could be said on the conduct of the Taluk Land Board making local inspection without there being any  written application and then surveying the whole of the area within a couple of hours on the same day. Reference was made to the evidence and the nature of  proceedings  earlier held  by  the  Taluk  Land Board, Case of the appellant that Cardamom  plantation  was  before  1.4.1964  was  incorrect. Letter  of  the appellant dated 18.10.1974 rather shows that cultivation of Cardamom was after 1.4.1964. In the affidavit dated 31.5.1976 of the appellant, it was  stated  that  main plantation  was tea. Statement of the General Manager of the appellant recorded by Taluk Land Board did not  mention  any Cardamom  plantation. Then again in the additional affidavit dated 22.6.1976 of the appellant, there is no mention of any Cardamom cultivation. When revision  was  filed  before  the High  Court against the order of the Taluk Land Board, again there was no mention of any cultivation of Cardamom. It  was not  technically possible for the Cardamom Board to conclude that Cardamom plantation  existed  prior  to  1964  and  the report was based on local inspection and queries and without any scientific basis. 3.    Taluk Land Board on remand could not examine the claim of  the  appellant  over and above 263.83 acres as exempt on account of other agricultural lands interspersed. In Devilal Modi, Properietor, M/s.   Daluram  Pannalal  Modi vs.  Sales  Tax Officer Ratlam & Ors.  [ (1965) 1 SCR 686 ], the lquestion before this Court was whether the principle of

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constructive res judicata  could  be  invoked  against  writ petition  filed  by  the  appellant under Article 226 of the Constitution.  The appellant had been assessed to  sales-tax for  the  year  1957-58  under  Madhya Bharat Sales Tax Act, 1950.  He challenged the validity of the order of assessment by a writ petition which was dismissed by the High Court  of Madhya Pradesh.    Appellant appeal by special leave to this Court was also dismissed.  At  the  hearing  of  the  appeal before  this Court, appellant sought to raise two additional points, but he was not been specified in the  writ  petition filed  before  the  High Court and had not been raised at an early stage.  On those points which were not allowed  to  be raised,  the  appellant  filed  another writ petition in the High  Court  challenging  the  validity  of  the  same  very assessment for  the year 1957-58.  High Court considered the merits of the additional grounds urged by the appellant  but rejected them.   Appellant  again  came to this Court.  This Court dismissed the appeal on the ground that  principle  of constructive    res   judicata   was   applicable   in   the circumstances and referred to its earlier decision in  Daryo & Ors.  vs.   The  State  of  U.P.  Ors.  [(1962) 1 SCR 574] holding that the general principle underlying  the  doctrine of res  judicata i.e.  ultimately based on considerations of public policy. One important consideration of public  policy is  that  the  decisions  pronounced  by courts of competent jurisdiction should be final, unless they  are  modified  or reversed  by  appellate authorities; and the other principle is that no one should be made  to  face  the  same  kind  of litigation  twice  over,  because  such  a  process would be contrary to considerations of fair play and justice. In Forward  Construction  Co.  &  Ors.  vs.  Prabhat Mandal  (Regd.) Andheri & Ors. [1986 (3) SCC 100] one of the questions raised was whether the writ petition out of  which appeal  had  arisen  in  the Supreme Court was barred by res judicata. High Court had negatived this plea for two reasons : (1) that in the earlier writ petition the vaildity of  the permission  granted  under  Rule  4(a)(i) of the Development Control rules was not in issue, and  (2)  that  the  earlier writ  petition  filed by Shri Thakkar was not a bona fide on inasmuch as he was  put  up  by  some  disgruntled  builder, namely,  M/s. Western Builders. This Court said on the first reason; (which is relevant for our purpose): "So far as  the first  reason  is  concerrned, the High Court in our opinion was not right in holding that the earlier judgment would not operate as res judicata as one of the grounds taken  in  the present  petition  was  conspicuous  by  its  absence in the earlier petition. Explanation IV to Section 11 CPC  provides that  any  matter  which  might  and ought to have been made ground of defence or attack in such  former  suit  shall  be deemed  to  have been a matter directly and substantially in issue in such suit. An adjudication is conclusive and  final not  only as to the actual matter determined but as to every other matter which the  parties  might  and  ought  to  have essentially   connected  with  the  subject  matter  of  the litigation and every matter  coming  within  the  legitimate purview of the original action both in respect of the matter of claim  or  defence.  The principle underlying Explanation IV is that where the parties  have  had  an  opportunity  of controverting  a  matter that should be taken to be the same thing as in the matter had been  actually  controverted  and decided.    It   is  true  that  where  a  matter  has  been constructively in issue it  cannot  be  said  to  have  been actually heard and decided.  It could only be deemed to have been heard  and described.  The first reason, therefore, has absolutely no force".

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In Y.B.  Patil & Ors.  vs.  Y.L.  Patil [AIR 1977 SC 392],  this  Court  said  that  "it  is  well  settled  that principles  of  res  judicata  cn  be  invoked  not  only in separate subsequent proceedings, they also get attracted  in subsequent stage of the same proceedings. Once an order made in  the  course  of  a proceeding becomes final, it would be binding at the subsequent stage of that proceeding."         We may refer to two more decisions  of  the  Supreme Court on the question of res judicata and estoppel. In Sunderabai w/o Devrao Deshpande and  another  vs. Devaji  Shankar Deshpande (AIR 1954 SC 82) under terms of an Award by the Arbitrator which was made  rule  of  the  Court decree provided that rights of adoption was lost to Gangabai from  the very beginning and the adoption of Devaji was held to be invalid and it  was  declared  that  the  adopted  son Devaji  was  not  and  could  never  become  entitled to the property belonging to the family of his grand father Devrao. With the object of maintaining peace  and  goodwill  in  the family decree provided that Sunderabai widow of Devrao shall pay to  Devaji  Rs.   8000/- in lump sum and that decree for maintenance  obtained  by  Gangabi  against  Sunderabai   in another suit  shall continue permanently.  It may be noticed that Gangabai was the widow of pre-deceased son  of  Devrao. The  Award  which took the shape of decree, it would appear, was accepted by the  parties  and  acted  upon.    Later  on relying  on  the  decision of the Privy Council in Anant vs. Shankar (AIR 1943 PC 196)  Gangabai  again  adopted  Devaji. Sunderabai also adopted her daughter’s son Jivaji.  All this led  to Devaji filing another suit now claiming his right as the validly adopted son of Gangabai.  This  Court  dismissed the  suit  filed by Devaji in view of principle of estoppel. The Court said that bar of res judicata, howeever,  may  not in  terms be applicable as the decree passed on the basis of the Award was in terms of the compromise and that the  terms of  Section  11 of the Code could not be strictly applicable to the same but the underlying principles of estoppel  would still apply. During the course of arguments, reference  was  made to  a decision of this Court in Malankara Rubber and Produce Co.  & Ors.  etc.  etc.  Vs.  State of Kerala & Ors.    etc. etc.   [(1973)  1  SCR  399],  a  case under the Kerala Land Reforma Act, 1964 as amended in 1969 and  1971,  where  this Court  held  that  lands planted with eucalyptus or teak are agricultural lands.  On the  interpretation  of  sub-section (9)  and  (9A) of Section 85 of the Act, we were referred to two decisions of the Kerala High Court.   In  Chathunny  vs. Taluk  Land  Board  [1981  KLT  74]  a Division Bench of the Kerala High Court held that Section 85(9) of the Act enables the  Taluk  Land  Board  to  set  aside  its   order   under sub-section (5) or sub-section (7) of Section 85 and proceed afresh  under that sub-section on satisfaction of any one of the matters enumerated in clauses (a) to (c) of  sub-section (9).   In  this  case,  order  of the Taluk Land Board under Section 85(5) or Section 85(7) had been  subject  matter  of relvision  to  the  High Court under Section 103 of the Act. These revisions had been heard and disposed of by  the  High Court.   The  question  was  whether  Taluk Land Board could exercise power under Section 85(9)  in  such  cases.    High Court  said  that sub-section (9) of Section 85 contemplated that exercise of powers by the Taluk  Land  Board  could  be exercised to set aside its "order" and once the order of the Taluk Land Board had merged with the order of the High Court passed  in revision, Taluk Land Board could not exercise its powers under sub-section (9) of Section  85.    It  appeared that because of this statement of law by the High COurt, Act

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was  amended  by  Act  16  of  1989  and sub-section (9A) of Section 85 was incorporated.  Thereafter, a single Judge  of the High  COurt in Thampi Gounder vs.  State of Kerala (1994 (1) KLT 89) held  that  powers  under  sub-section  (9A)  of Section  85  could be exercised notwithstanding any revision of the High COurt under Section 103 arising out of the final orders passed by the Taluk  Land  Board  under  sub-sections (5),  (7)  and  (9)  of Section 85 and that this would be so even where the order of the Taluk Land Board merged with the order of the High Court. Form 1 under which statements/return is to be  filed requires  complete  details  of  the  plantation as meant in Section 2(44) of the Act.  It  is  to  be  accompanied  with various  annexures. The appellant never claimed exemption on the ground of Cardamom plantation existing prior to 1964. It never asked for amendment of  the  return/statement  at  any stage  of the proceedings. It sought exemption on the ground of the land under the heading ’fuel area’. Once  the  matter had  been  determined by the Supreme Court in appeaal, there was no scope for any review by Taluk Land Board to hold that there was Cardamom Plantation existing prior to 1964 in that very area. Mr. P Krishnamurthy is right in  his  submissions that  there  was  no foundation ever made for review of that part of the land falling under the ’fuel area’ was, in fact, cardamom plantation. There was no  scope  for  invoking  the provisions  of sub-section (9) and/or (9-A) of Section 85 of the Act. The two decisions of the  Kerala  High  Court  are, therefore, not quit relevant for our purposes. High Court by its judgment dated March 15, 1977  had set  aside  the order of Taluk Land Board allowing exemption of 100 acres when appellant  had  claimed  263.83  acres  as agricultural  land interspersed within the boundaries of the area cultivated by the appellant.  The extent of  this  area was  to  be determined by the Land Board as Taluk Land Board at the relevant time had no jurisdiction  to  so  determine. the  appellant had specifically claimed 263.83 acres of such land under the head "other agricultural land  interspersed". After the remand Taluk Land Board was also vested with power w.e.f.   7.7.1979  to  determine  the  extent  of land under clause (c) of Section 2(44) of the Act.    That  would  not, however, mean that Taluk Land Board could now determine that area under  this  head exceeded 263.83 acres.  To the extent that Tulak Land Board by  its  order  dated  July  26,  1980 upheld  the  claim  of  the  appellant  to  263.83  acres as "agricultural land interspersed within the boundaries of the area cultivated with plantation  crops"  cannot  be  failed. though  under  the  heads  ’fuel area’ and ’rested tea area’ there was difference of opinion among the Chairman and other members of the Tulak Land Board there was unamimity  between them  on  the question of area of 263.83 acres falling under the head ’other agricultural land interspersed’.  It  cannot be  said that Taluk Land Board, while determining this area, did  not  take  into  consideration  relevant   factors   as mentioned in  clause (c) of Section 2(44) of the Act.  We do not think it was necessary for the High Court  to  lay  down any  further guidelines than what are given in the provision and for that purpose to remand the matter again to the Taluk Land Board. We would, therefore, set aside the order of  the High Court to that extent. It is settled law that principles  of  estoppel  and res  judicata  are  based  on  public  policy  and  justice. Doctrine of res judicata is often treated as a branch of the law of estoppel though these two doctrines  differ  in  some essential particulars.    rule  of res judicata prevents the parties to a judicial determination from litigating the same

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question over again even though the determination  may  even he demonstratedly wrong.  When the proceedings have attained finality, parties are bound by the judgment and are estopped from questioning it.  They cannot litigate again on the same cause  of  action  nor can they litigate any issue which was necessary for decision in the earlier litigation.  These two aspects are ’cause of action estoppel’ and ’issue estoppel’. These two terms are of common law origin.    Again  once  an issue   has   been   finally   determined,   parties  cannot subsequently in the same suit advance  arguments  or  adduce further  evidence directed to showing that issue was wrongly determined.  their only remedy is  to  approach  the  higher forum if  available.  the determination of the issue between the parties gives rise to as noted above, an issue estoppel. It operates in any subsequent proceedings in the  same  suit in  which the issue had been determined. It also operated in subsequent suits between the same parties in which the  same issue  arises.  Section  11  of  the Code of Civil Procedure contains provisions  of  res  judicata  but  these  are  not exhaustive  of  the  general doctrine of res judicata. Legal principles  of  estoppel  and  res  judicata   are   equally applicable  in proceedings before administrative authorities as they are based on public policy and justice. As to what is issue estoppel was considerred by this Court in Gopal Prasad Sinha vs.  State of  Bihar  [(1970)  2 SCC 905].   This case arose out of criminal prosecution, the accused was tried on a charge  under  Section  409  IPC  for having   committing   criminal   breach  of  trust  for  Rs. 27,800/during  the  period  between  January  31,  1960   to November  30,  1960,  when  he  was acting as Cashier in the Public Works Department of the State.  The accused contended that he had been put up on a trial in a previous case  under Section  409,  IPC  for  having committed criminal breach of trust with respect to  certain  amounts  during  the  period December  8,  1960  to  August 17, 1961 and in that case the High Court had acquitted him holding  that  he  was  not  in charge of  the case.  The point of issue-estoppel was, thus, raised by the accused.    The  trial  Court  held  that  the aforesaid  finding  of the High Court could not operate as a res judicata. High Court affirmed the decision of the  trial Court. In this Court, it was contended that substantially it was  the  same issue that was tried during the earlier trial and if the accused was  not the  Cashier  from  December  8, 1960  to August 11, 1961, he could not be held to be Cashier from January 31, 1960 to  November  11,  1960.  The  accused contended  that  the defence in both the cases was identical and the evidence also almost the same. This  Court  observed as under:         "In  our opinion, the High Court came to the correct         conclusion. The basic principle underlying the  rule         of  issueestoppel is that the same issue of fact and         law  must  have  been  determined  in  the  privious         litigation.  The  question  then arises : Was it the         same issue of  fact  which  was  determined  in  the         earlier case? A person may be acting as a cashier at         one  period  and  may  not be acting as a cashier at         another period, especially as in this  case  it  was         found that the appellant had never been appointed as         a  cashier. He was a temporary senior accounts clerk         who was alleged to be doing the work of  a  cashier.         If  there  is  any  likelihood of facts o conditions         changing during the  two  periods  which  are  under         consideration  then  it is difficult to say that the         prosecution would be  bound  by  the  finding  in  a         previous  trial on a similar issue of fact. It seems

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       to us that the later finding must necessarily be  in         contradiction  of  the previous determination. There         can be no such  contradiction  if  the  periods  are         different  and the facts relating to the carrying on         of the duties of a cashier are different". Mr.  salve strongly relied on the decision of the  House  of Lords in Aronold & Ors.  vs.  National Westminster Bank Plc. [(1991)  2  AC  93] to submit that the appellant could again raise the plea of ’rested tea area’,  ’Cardamom  plantation’ and ’agricultural land interspersed’ for adjudication before the  Taluk  Land  Board  when it was seized of the matter on remand.  He said though issue estoppel constituted a bar  to relitigation  between  the  same parties of a decided point, appellants were not estopped to seek redetermination of  the issue in  the  facts and circumstances of the case.  He said the first return/statement was filed without  prejudice  and though  exemption  was  not claimed specifically as Cardamom plantation, the fact that Cardamom was  growing  was  within the knowledge  of the authorities.  It was, in fact, brought on record in an earlier letter of  1974  by  the  appellant. Then, there  was  subsequent change of law.  Now, this Court by judgment in Pioneer  Rubber  plantation  vs.    State  of Kerala & Anr.  [(1992) 4 SCC 175] delivered by three Hon’ble Judges held that supply of fuel wood to the employees cannot be said to be purpopse unconnected to the cultivation of the plantation.   Further  as to what is rested tea area was not correctly brought out and there is voluninous authorities to show that keeping certain area of the plantation  as  rested tea  area is in the larger interest of the plantation itself and a part of the plantation activities.  Then, there was  a judgment of  this Court in Malankara Rubber & Produce Co.  & Ors.  etc, ettc.  vs.  State of kerala &  Ors,  etc.    etc. [(1973)   1   SCR  399]  holding  that  lands  planted  with Eucalyptus or teak trees are agricultural lands.  Mr.  Salve said all these factors will take the case out of the bar  of issue estoppel.      He   again   pointed   that   when  the return/statement was filed, position of law was not clear as the Act had then recently come into force. In Arnalds &  Ors.    vs.  National Westminster Bank Plc.   [(1991)  2  AC  93]  House  of  Lords   noticed   the distinction  between  cause  of  action  estoppel  and issue estoppel.  Cause of action estoppel arises where  the  cause of  action  in  the later proceedings, the latter havig been between  the  same  parties  or  their  privies  and  having involved the same subject matter.  In such a case the bar is absolute  in  relation to all points decided unless fraud or collusion is alleged, such as to justify setting  aside  the earlier judgment.  The discovery of new factual matter which could  not  have  been found out by reasonable diligence for use in the earlier proceedings does not  according  to  tthe law of  England,  prevent the latter to be re-opened.  Issue estoppel may  arise  where  a  particular  issue  forming  a necessary ingredient in a cause of action has been litigated and  decided  and in subsequent proceedings between the same parties involving a different cause of actin  to  which  the same  issue  is relevant one of the parties seeks to re-open that issue. Here also bar is complete to  re-litigation  but its  operation  can be thwarted under certain circumstances. The House then finally observed.         "Butg there is room for the view that the underlying         principles upon  which  estoppel  is  based,  public         policy  and  justice, have greater force in cause of         action estoppel,  the  subject  matter  of  the  two         proceedings  being  identical, than they do in issue         estoppel, where the  subject  matter  is  different.

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       Once  it  is  accepted that different considerations         apply to issue estoppel, it is hard to perceive  any         logical  distinction  bettween  a  point  which  was         previously raised and decided and  one  which  might         have been  but  was  not.    Given  that the further         material which would have put an entirely  different         complexion  on  the  point  was at the earlier stage         unknown to the party and  could  not  by  reasonable         diligence have been discovered by him, it is hard to         see why there should be a different result according         to whethr he decided not to take the point, thinking         it  hopeless,  or  argue it faintly without any real         hope of success.  In my opinion your Lordship should         affirm it to  be  the  law  that  there  may  be  an         exception   to   issue   estoppel   in  the  special         circumsttances that there has vecome available to  a         party  further  material  relevant  to  the  correct         determination of a point  involved  in  the  earlier         proceedings,   whether   or   not   that  point  was         specifically  raised  and  decided,  being  material         which  could  not  by  reasonable iligence have been         adduced in those proceedings. One of the purposes of         estoppel being to work justice between the  parties,         itt  is  open to courts to recognise that in special         circumstances inflexible application of it may  have         the opposite result....."               Next question for consideration is whether the         further  relevant  material  which  a  party  may be         permitted to bring forward in the later  proceedings         is  confined to matters of fact, or whether what may         not entirely inappositely be described as  a  change         in  the  law  may  result  in,  or  be an element in         special  circumstances  enabling  an  issue  to   be         re-opened.         Your  Lordships  should appropriately, in my         opinion, regard the matter as entire and approach it         from the point of view of principle. If a Judge  has         made a mistake, perhaps a very egregious mistake, as         is  said  of  Walton J.’s judgment here, and a later         judgment  of a higher court overrules  his  decision         in   another  case,  do  considerations  of  justice         require  that  the  party  who  suffered  from   the         misttake  should  be  shut  out, when the same issue         arises in later proceedings with a different subject         matter, from reopening that issue?         I  am  satisfied,  in  agreement  with  both         courts below, that the instant case presents special         circumstances  such  as to require the plaintiffs to         be permitted to reopen the question of  construction         decided  against  them  by  Walton  J., that being a         decision which I regard as plainly wrong." Mr.  Salve’s  asserrtions  based  on  the  aforesaid decision of the House of Lords may be valid to an extent but then  in view of the principles of law laid by this Court on the application of res judicata and estoppel and considering the provisions of Section 11 of the Code  we  do  not  think there  is any scope to incorporate the exception to the rule of issue estoppel as given in Arnold and others vs. national Westminster Bank Plc. (1991 (2) AC 93). Law on res judicata and estoppel is well  understood in  India  and there are sample authoritative pronouncements by various courts on these subjects.   As  noted  above  the plea  of  res judicata, though technical, is based on public policy in order to  put  an  end  to  litigation.    It  is, however,  a  different if an issue which had been decided in

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earlier litigation again arises  for  determination  between the  same parties in a suit based on a fresh cause of action or where there is continuous cause of action.   The  parties then  may  not be bound by the determination made earlier if in the meanwhile law has changed  or  has  been  interpreted differently  by  higher  forum.  But that situation does not exist here. Principles of constructive  res  judicata  apply with  full  force.  It  is  the subsequent stage of the same proceedings.  If  we  refer  to  Order  XLVII  of  the  Code (explanation  to  Rule  1)  review is not permissible on the ground "that the decision on a question of law on which  the judgment  of  tthe  Court  is  based  has  been  reversed or modified by the subsequent decision of a  superor  COurt  in any other case, shall not be a ground for the review of such judgment". Since the appellant never claimed exemption  outside the  ceiling  area  on the ground of cardamam plantation the question was never gone into in the earlier  proceedings  of this Court.    This  point, therefore, could not be agitated before the Taluk Land  Board  dealing  with  the  matter  on remand as finality attached to the areas under the fuel area and  rested  tea  area  for which exemption was not or fully granted. It is, therefore, unnecessary for us to go into the question if cardamom  plantation  existed  at  the  relevant time.  We, therefore, uphold tthe judgment of the High Court on the extent of  ’fuel  area’  and  ’rested  tea  area’  as determined  finally by this Court in CA No. 227/78 and would dismiss the appeal limited to this extent. Though  we  have  upheld the order of the High Court mainly  on  the  grounds  of  res  judicata  and   estoppel, submission  of  the  appellant  commands to us that they bve given opportunity to approach the State Government  to  seek exemption under provisions of Sub-section 3 of Section 81 of the Act.   This is particularly so as a three Judge Bench of this Court has held that supply of fuel wood to employees is for the purpose connected with the plantation,  which  is  a later  decision  of  the  two  Judge  Bench decision of this Court. Further that  rested  tea  area  is  a  part  of  tea plantation  was  not properly projected before this Court as has been rightly contended by Mr. Salve. It is a  matter  of experience  and  on reference to authoritative text books if rested tea areas are part of the plantation. We  allow  the  appellant  to  approach  the   State government  to seek exemption under Sub-section 3 of Section 81 of the Act. For this purpose we grant six weeks  time  to the  appellant  to  apply to the State Government. the State Government  shall  take  decision  on  such  application  in accordance  with  law  explained  above.  till then the stay granted by this Court by order dated December 6, 1984  shall continue tto operate. With  these  observation  the  appeal  stands partly allowed. There shall be no order as to costs.