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PETITIONER: RANA SHEO AMBAR SINGH

       Vs.

RESPONDENT: ALLAHABAD BANK LTD., ALLAHABAD.

DATE OF JUDGMENT: 27/04/1961

BENCH: WANCHOO, K.N. BENCH: WANCHOO, K.N. GAJENDRAGADKAR, P.B. GUPTA, K.C. DAS AIYYAR, T.L. VENKATARAMA

CITATION:  1961 AIR 1790            1962 SCR  (2) 441  CITATOR INFO :  RF         1962 SC1464  (19)  F          1969 SC 971  (14,16)  R          1970 SC1880  (3)  D          1971 SC  77  (10)  D          1971 SC1678  (6,13,14,20)  R          1973 SC1269  (3)  D          1975 SC2295  (8)  RF         1977 SC1552  (1)

ACT: Mortgage  Decree-Proprietory rights  in  Zamindari-Execution proceedings  pending -Zamindari  rights  abolished-Bhumidari rights  confirmed on intermediaries--Mortgagor, if can  sell Bhumidari  rights  in  execution-Relief  available-  U.   P. Zamindari  Abolition and Land Reforms Act, 1950 (U.P.  1  of 1951), ss. 6(a)(i), 6(h), 18.

HEADNOTE: The appellant’s father, a Talukdar of the Estate of  Khajur- gaon, executed a simple mortgage of his proprietary interest in  the  estate consisting of sixty-seven  villages  to  the Allahabad  Bank  Ltd.   While  execution  proceedings   were pending, the U. P. Zamindari Abolition and Land Reforms Act, 1950,  came  into force from July 1952.  As  a  result,  the Zamindari  rights  of  the  appellant  judgment-debtor  were abolished and it was no longer possible to sell these rights in the 67 villages.  The respondent Bank made an application before  the  executing court that as  the  Zamindari  rights could  not be sold, only such rights of the  judgment-debtor as remained in him after coming into force of the Act  might be sold along with certain other rights. Objections  were  taken and finally the matter  came  up  by appeal to the High Court and it, inter alia, upheld the view of  the  executing court that the  execution  could  proceed against  the  Bhumidari  rights created  in  favour  of  the appellant under s. 18 of the Act. The question was whether the Bhumidari rights created  under s.  18  of the Act could also be sold in  execution  of  the decree  in view of the fact that the proprietary rights  bad vested in the State.

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Held,  that the intention of the U. P.  Zamindari  Abolition and  Land Reforms Act was to vest the proprietary rights  in the  Sir and Khudkast land and grove land in the  Estate  by virtue of s. 6(a)(i) and resettle it on the intermediary not as compensation but by virtue of his cultivatory  possession of  lands comprised therein and on a new tenure  and  confer upon the intermediary a new and special right of  Bhumidari, which he Dever had before, by s. 18 of the Act. The proprietary rights in Sir, Khudkast land and grove  land which  were mortgaged were extinguished, and  the  Bhumidari right  which  was altogether a new right could not  be  con- sidered to be included under the mortgage. 442 The  mortgagee  could only enforce his  rights  against  the mortgagor  in the manner as provided by s. 6(h) of  the  Act read  with s. 73 of the Transfer of Property Act and  follow the compensation money; and so far as the Sir, Khudkast land and  grove  land were concerned, he could  not  enforce  his rights  under  the  mortgage by the sale  of  the  Bhumidari rights created in favour of the mortgagor against them as  a substituted security. In  the instant case the Bhumidari rights created in  favour of  the  appellant  could not be sold in  execution  of  the decree held against him by the respondent under the mortgage Of 1914.

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 301 of 1960. Appeal  from  the judgment and decree  dated  September  24, 1958, of the Allahabad High Court (Lucknow Bench) at Lucknow in First Execution of Decree Appeal No. 8 of 1953. C.   B.  Agarwala,  Shankar Prasad and C. P.  Lal,  for  the appellant. Iqbal  Ahmed,  N. C. Chatterjee, D. N. Mukherjee and  B.  N. Ghosh, for the respondent. 1961.  April 27.  The Judgment of the Court was delivered by WANCHOO,  J.-This is an appeal on a certificate  granted  by the  Allahabad  High Court.  The brief facts  necessary  for present  purposes  are these.  The appellant’s  father  Rana Umanath Bakshsingh was the Talukdar of Khajurgaon.  On  July 13, 1914, Rana Umanath Bakshsingh executed a simple mortgage in favour of the Allahabad Bank Limited (hereinafter  called the respondent).  The mortgage was for a sum of Rs. 6,00,000 and   the  property  mortgaged  consisted   of   sixty-seven villages.  In May 1924, the respondent filed a suit for  the recovery of the balance of the unpaid mortgage money by  the sale   of  the  mortgaged  property.   In  January  1925   a preliminary decree for the recovery of rupees four lacs  and odd  was  passed,  which was made final  in  July  1926  and directed  the  sale of the mortgaged property,  namely,  the proprietary rights of Rana Umanath Bakshsingh in the  sixty- seven  villages.  Then followed execution applications  with which we are not concerned.  In 1934, the U. P.                             443 Agriculturists’  Relief  Act  was passed  and  thereupon  an application   was  made  by  the  judgment-debtor  for   the amendment  of  the decree under that Act.   On  October  19, 1936,  the decree was amended under the provisions  of  that Act  and thereafter the pending execution  proceedings  were dropped  as  installments had been fixed.   Eventually,  the respondent applied for execution on-May 25, 1940.  Objection was  taken  to this application on the ground  that  it  was barred  by  time; but this matter was  decided  against  the

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judgment-debtor  and  thereafter  the  execution  has   been proceeding uptil now on this application. On  July  1, 1952, the U. P. Zamindari  Abolition  and  Land Reforms  Act, 1950 (1 of 1951), hereinafter called the  Act, came  into force.  As a consequence of this  enactment,  the zamindari  rights of the judgment debtor were abolished  and it was no longer possible to sell these rights in the sixty- seven  villages.  Consequently, on September 29,  1952,  the respondent made an application that as the zamindari  rights could  not be sold, only such rights of the judgment  debtor as  remained in him after the coming into force of  the  Act might  be  sold, namely, the rights in trees  and  wells  in abadi and buildings situate in various villages under  sale. It  was also prayed that the judgment  debtor’s  proprietary rights  in grove land and sir and khudkashat land  had  been continued  under  s.  18 of the Act  and  these  constituted substituted  security  in place of  the  proprietary  rights mortgaged  with the respondent and they should also be  sold Finally it was prayed that compensation money payable to the judgment-debtor on the acquisition of the proprietary rights by the State might be treated as substituted security. The  appellant  objected to these  applications  on  various grounds.  The execution court held that the buildings, trees and  wells situated in the abadi were liable to be  sold  in execution   of  the  decree.   It  further  held  that   the respondent  was entitled to compensation amount  granted  by the  State to the appellant in lieu of zamindari  rights  as substituted  security.  Finally, it held that the  bhumidari rights acquired by the 444 appellants  under  s. 18 of the Act could also  be  sold  in execution of the decree. The  appellant  then took the matter in appeal to  the  High Court,  and the two points urged before the High Court  were (i)  that the bhumidari rights created by s. 18 (i)  of  the Act  could not be sold in execution of the decree, and  (ii) that  the application dated September 20, 1952, was a  fresh application for execution and as it was filed over 12  years after the date of the amended decree it was barred by  time. The  High  Court repelled both these contentions,  and  held that  execution could proceed against the  bhumidari  rights created  in favour of the appellant under s. 18 of  the  Act and  further that the application dated September 20,  1952, was  within time as it was not a fresh application  and  the decree  holder  was only seeking to execute  the  decree  in respect of the property for the sale of which he had already applied  within  time  allowed  by  law.   The  High   Court therefore dismissed the appeal.  The appellant then obtained a  certificate to appeal to this Court; and that is how  the matter has come up before us. The main point urged on behalf of the appellant is that  the decision  of  the High Court that bhumidari  rights  created under s. 18 of the Act can also be sold in execution of  the decree,  is  not  correct.  Under  the  mortgage  deed,  the property mortgaged consisted of the property forming part of the  Talukdari  of Khajurgaon detailed at the  foot  of  the mortgage,  namely,  the  sixty-seven  villages.   Thus   the mortgage consisted of the proprietary interests only of  the mortgagor  in  the  sixty-seven villages, and as  it  was  a simple  mortgage, possession of no part of the property  was given  to  the mortgagee. it is therefore contended  by  Mr. Aggarwala on behalf of the appellant that as the proprietary right in the sixty-seven villages vested in the State  under the  Act,  the respondent who was only entitled to  get  the proprietary rights sold under the mortgage can now fall back

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only on compensation payable to the appellant under the Act, and reliance in particular is placed on s. 6 (h) of the  Act in this connection.  On the other hand, the contention on                             445 behalf  of the respondent is that bhumidari  rights  arising under  s.  18  of  the Act are liable to  be  sold  as  they represented the proprietary rights which were mortgaged  and in  any  case they can be sold as  substituted  security  in place of the property mortgaged. We  have  therefore to look into the scheme of  the  Act  in order to decide between the rival contentions.  It is not in dispute  that the Taluka of Khajurgaon was an estate  within the  meaning  of  the Act.  It may  be  mentioned  that  the judgment-debtor  had  certain sir and khudkashat  lands  and zamindar’s  grove  in  the  sixty-seven  villages  comprised within the Talukdari estate.  Section 4 of the Act  provides for  vesting  of an estate in the State on the making  of  a notification  thereunder  and the Taluka of  Khajurgaon  has vested  in the State by virtue of such a  notification  made under  s.  4. Section 6 prescribes the consequences  of  the vesting  arising under s. 4 and we may refer to s. 6(a)  (i) as  that  will show in what the interests of  the  judgment- debtor ceased and became vested- in the State:-               "(a)-all rights, title and interest of all the               intermediaries-               (i)   in  every estate in such area  including               land   (cultivable  or  barren),   grove-land,               forests  whether  within  or  outside  village               boundaries, trees (other than trees in village               abadi,  holding or grove),  fisheries,  tanks,               ponds,   water-channels,  ferries,   pathways,               abadi sites hats, bazars or melas (other  than               hats,  bazars, melas held upon land  to  which               clauses  (a)  to  (c) of  sub-section  (1)  of               section 18 apply),  and .               ............................................ .               shall  cease  and be vested in  the  State  of               Uttar Pradesh free from all encumbrances."               Clause (h) of s. 6 is also material and is  in               these terms:               "(h)  no  claim or  liability  enforceable  or               incurred  before  the date of  vesting  by  or               against such intermediary for any money, which               is  charged on or is secured by a mortgage  of               such  estate or part thereof shall, except  as               provided  in  section 73 of  the  Transfer  of               Property Act, 1882, be enforceable against his               interest in the estate."               57               446 All  lands therefore whether cultivable or barren  or  grove lands  vested  in the State on the notification under  s.  4 having  been  made save as otherwise provided in  this  Act. Therefore, proprietary rights in Sir and khudkashat land and grove land would vest in the State on the coming into  force of  the  notification  under  s. 4  unless  there  was  some provision  otherwise  in  the Act.  The  contention  of  the respondent therefore that sir and khudkashat land and  grove land continued to be the property of the appellant and would therefore remain liable to be sold in execution  proceedings would fail in view of the notification under s. 4, unless of course there is a provision otherwise in the Act.  The  only provisions otherwise on which the respondent relies are  ss. 9  and  18 of the Act.  So far as s. 9 is concerned,  it  is certainly a provision otherwise and it provides as follows:-

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             "All   wells  or  trees  in  abadi,  and   all               buildings  situate  within the  limits  of  an               estate,   belonging   to   or   held   by   an               intermediary   or  tenant  or  other   person,               whether residing in the village or not,  shall               continue  to  belong  to or be  held  by  such               intermediary,  tenant or person, as  the  case               may  be,  and  the site of the  wells  or  the               buildings  with the area  appurtenant  thereto               shall be deemed to be settled with him by  the               State Government on such terms and  conditions               as may be prescribed." This provision clearly creates an exception to the  property which  vests  in the State on the making of  a  notification under  s.  4. The exception is in favour of  all  wells  and trees  in abadi and all buildings and it is  significant  to note  that  these  things will continue  to  belong  to  the intermediary,  though the further provision shows  that  the site  of the wells, and buildings with the area  appurtenant thereto would vest in the Government and would be deemed  to be  settled  with the intermediary on  such  conditions  and terms as may be prescribed.  The effect therefore of s. 9 is that wells, trees in abadi and buildings apart from the land under  them continue to belong to the intermediary (and  the appellant is undoubtedly an intermediary within the  meaning of the Act); but even here the                             447 land on which the buildings and the wells stand vest in  the State  and  it is deemed settled with  the  intermediary  on terms and conditions to be prescribed.  So far therefore  as wells  and trees in abadi and all buildings  are  concerned, these  continue to belong to the appellant and if  they  are covered by the mortgage they would be liable to sale.  As we have  already pointed out, there was no dispute  before  the High  Court  with respect to wells, and trees in  abadi  and buildings  and it was conceded there that these were  liable to be sold, the only dispute being with respect to bhumidari rights created under s. 18. Let  us  now  turn to s. 18 and see whether  it  is  also  a provision otherwise like s. 9. The relevant part of s. 18 for our purposes is in these terms:-               "(1) Subject to the provisions of sections 10,               15, 16 and 17, all lands-               (a)   in possession of or held or deemed to be               held by an intermediary as sir, khudkashat  or               an intermediary’s grove,               on the date immediately preceding the date  of               vesting  shall be deemed to be settled by  the               State   Government  with  such   intermediary,               lessee, or tenant, grantee or grove-holder, as               the  case  may be, who shall  subject  to  the               provisions of this Act be entitled to take  or               retain possession as a bhumidar thereof." It is well to contrast the language of this section with the language  of s. 9. Section 9 lays down that trees and  wells in  abadi  and  buildings shall continue to  belong  to  the intermediary  and  that  shows  that  it  was  a   provision otherwise  excepting these three items from vesting  in  the State  by  virtue  of the notification under s.  4  and  its consequence  under s. 6; but there is no provision in s.  18 of  the Act to the effect that sir and khudkashat  land  and intermediary’s  grove  shall  continue  to  belong  to   the intermediary.  Therefore, sir and khudkashat land and  grove land  would vest in the State by virtue of s. 6 (a) (i)  for there is no provision otherwise in s. 18 in that behalf.  In

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this connection we may refer for comparison to s. 23 of the 448 Rajasthan Land Reforms and Resumption of Jagirs Act, No.  VI of  1952  (hereinafter  called  the  Rajasthan  Act)   which provides  that  "notwithstanding anything contained  in  the last  preceding  section  (i.e.  s.  22,  which  refers   to consequences  of  resumption),  all khudkashat  lands  of  a Jagirdar etc. shall continue to belong to or be held by such jagirdar or other person".  If the intention of the Act  Was not  to vest sir and khudkashat land and grove land  in  the State we would have found an exception similar to that found in the Rajasthan Act.  Section 9 itself shows in what manner the  legislature  was making an exception when  it  did  not intend that a particular property should vest in the  State. If the intention were that sir and khudkashat land and grove land  should  not vest in the State, s. 18 would  have  been worded in the same way as s. 9. Further the way in which  s. 18  is worded, (namely that khudkashat and sir land  and  an intermediary’s grove shall be deemed to be settled with  the intermediary  and  he would have bhumidari  rights  therein) shows that these three kinds of property vested in the State under   s.  6(a)(1)  and  were  then  resettled   with   the intermediary  on  a new tenure and not in  the  same  right, which  he had in them before the vesting.   The  legislature was  therefore creating a new right under s. 18 and the  old proprietary  right  in  sir  and  khudkashat  land  and  any intermediary’s grove land had already vested under s.  6  in the State.  Therefore, it cannot be said that s.  18  is  an exception to the consequences provided in s. 6 and therefore sir  and khudkashat land and grove land continue to  be  the property  of  the judgment debtor in this case in  the  same manner as they were his property at the time of the mortgage and would therefore be available in execution of the  decree as the proprietary rights mortgaged.  We are of opinion that the  proprietary  rights in sir and khudkashat land  and  in grove land have vested in the State and what is conferred on the intermediary by s. 18 is a new right altogether which he never had and which could not therefore have been  mortgaged in 1914. Our attention in this connection was drawn to the                             449 compensation sections in the Act, and it was urged that what was given to the intermediary under s. 18 was really his old right  because  no compensation was to be paid to  him  with respect  to  what was left to him under s.  18.   The  first section  to be considered in this connection is s. 39  which deals  with gross assets of a mahal.  In these gross  assets the  amount  computed  at the rates applicable  to  the  ex- proprietary tenants of similar land for land in the personal cultivation  of or held as intermediary’s grove,  Khudkashat or  sir  by all the intermediaries in the estate was  to  be included subject to certain exceptions which are  immaterial for  our purposes.  The very fact that in the  gross  assets the rents of these lands in which the bhumidari rights  were created under s. 18 were taken into consideration shows that these  lands also vested in the State; if that were  not  so there  was  no necessity for including these assets  in  the gross  assets for the purposes of compensation.  Here  again we may refer to a similar provision in the Rajasthan Act for purposes  of  comparison.  The second Schedule to  that  Act provides  how  gross  income  is to  be  calculated  and  in calculating the gross income the income from khudkashat land has not been taken into account because it was excepted from the  consequence of resumption under s. 23 of that Act.   It is  true  that under s. 44 of the Act when  calculating  net

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assets,  the income from sir and khudkashat land  and  grove land  has been excluded on the ground that bhumidari  rights have been conferred therein under s. 18 of the Act.  That is however for the purposes of calculating what should, be paid to  the intermediary as compensation and in that  connection it  was  necessary to take into account the  fact  that  the legislature  was  creating a new right in  the  intermediary with  respect  to  certain lands and therefore  it  was  not necessary  to  give money as compensation.  That  would  not however  make  any difference in our view as  to  the  legal effect  of  the  notification  under  s.  4  and  under  the notification  sir and khudkashat land and grove  land  would vest  in  the  State and would not be an  exception  to  the consequences   of  vesting  in  s.  6  and   therefore   the proprietary right in sir 450 and  khudkashat  land and grove land  which  were  mortgaged would  be  extinguished  and the bhumidari  right  which  is created  by s. 18 would be a new right altogether and  would not  therefore  be  considered  to  be  included  under  the mortgage in this case. This  brings  us to a consideration of s. 6(h) of  the  Act. That  lays down that "no claim or liability  enforceable  or incurred  before  the  date of vesting by  or  against  such intermediary  for  any  money, which is  charged  on  or  is secured by a mortgage of such estate or part thereof  shall, except as provided in s. 73 of the Transfer of Property Act, 1882,  be enforceable against his interest in  the  estate". This  provision has in our opinion a, two-fold  effect.   In the first place, it makes it impossible for the mortgagee to follow  the proprietary right after it vests in  the  State. Secondly,  it  provides  that  the only  way  in  which  the mortgagee  can recover his none advanced on the security  of the  property  which vested in the State by  virtue  of  the notification  under s. 4 and the consequences thereof  under s. 6 is to follow the procedure under s. 73 of the  Transfer of  Property  Act.  Section 73(2) provides that  "where  the mortgaged  property  or  any part thereof  or  any  interest therein is acquired under the Land Acquisition Act, 1894  (1 of 1894), or any other enactment for the time being in force providing  for  the  compulsory  acquisition  of   immovable property,  the mortgagee shall be entitled to claim  payment of  the  mortgage  money, in whole or in part,  out  of  the amount  due to the mortgagor as compensation".  There is  no doubt  that  the property mortgaged  has  been  compulsorily acquired   in  this  case  by  the  State  under  the   Act. Therefore,  s.  6  (h)  read with s.  73  directs  that  the mortgagee  shall  proceed in the manner provided in  s.  73, namely, follow the compensation money, and there is no other way possible for him in view of s. 6(h) with respect to  the property  which  has been acquired under the Act.   We  have held  that sir and khudkashat land and grove land have  been acquired  under  the  Act  and have  vested  in  the  State; therefore  the mortgagee is relegated to enforce his  rights against the mortgagor in the manner provided in s. 73 of the 451 Transfer  of Property Act and in no other way.  What we  say here does not affect that property which is not acquired  by the State, for example, property excepted under s. 9 of  the Act;  but  where  the property has vested in  the  State  by virtue  of  a notification under s. 4 and  its  consequences under  s.  6, the only course open to the  mortgagee  is  to follow the compensation money under s. 6(h).  The  bhumidari rights  created under s. 18 are not compensation;  they  are special  rights conferred on the intermediary by  virtue  of

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his  cultivatory possession of the lands comprised  therein. The respondent therefore cannot enforce his rights under the mortgage  by sale of the bhumidari rights created in  favour of  the  appellant  under  s.  18 so  far  as  his  sir  and khudkashat  land and grove land are concerned; it  can  only follow  the compensation money as provided in s. 6(h).   The argument   that  bhumidari  rights  can  ’be   followed   as substituted security must therefore equally fail. Our attention in this connection was drawn to s. 8(2) of the U.  P. Zamindars Debt Reduction Act, No. XV of  1953.   That Act  provides for scaling down of debts of  zamindars  whose estates have been acquired under the Act.  It also  provides that the debts due shall be realisable from the compensation and rehabilitation grant, and in particular s. 8(2) provides that "notwithstanding anything in any law the reduced amount found  in the case of a mortgagor or judgment-debtor as  the case  may  be, under section 3 or 4  as  respects  mortgaged estates shall not be legally recoverable otherwise than  out of the compensation and rehabilitation grant payable to such mortgagor  or judgment debtor in respect of  such  estates". We  have not been able to understand how the  provisions  of the  U. P. Zamindars Debt Reduction Act can affect the  con- struction  of s. 6(h) of the Act read with other  provisions of  the  Act.   It  is not necessary  for  us  therefore  to construe s. 8(2) of the U. P. Zamindars Debt Reduction  Act, for we are clear on the provisions of s. 6 (h) and the other provisions  of  the  Act that bhumidari  rights  created  in favour  of the appellant cannot be sold in execution of  the decree held against him by the respondent under the mortgage of 1914. 452 This brings us to the question of limitation.  Mr. Aggarwala conceded  that if the appellant succeeds on the first  point it would not be necessary for us to consider the question of limitation.   Therefore,  as the appellant succeeds  on  the first point we need not consider whether the application for execution by sale of bhumidari rights created under s. 18 is barred by limitation. We therefore allow the appeal and direct that the  execution of  the decree by the respondent will not be levied  against the  bhumidari  rights created in favour  of  the  appellant under s. 18 of the Act.  The appellant will get his costs of this  court and of the High Court.  Costs of  the  execution court will be at the discretion of that Court. Appeal allowed.