05 Aug 2121

The possession and ownership of surplus land that must be given to competent authorities cannot be taken or sold - Supreme Court of India

Case : Shri Saurav Jain & Anr v. M/s A. B. P. Design & Anr Civil Appeal No. 4448 of 2021 (Arising out of SLP (C) No. 29868 of 2018)

Court : Supreme Court of India

Bench : Justice Dr Dhananjaya Y Chandrachud and Justice M R Shah

Decided on : 05 Aug 2121

The Relevant Statutes

Article 252, 136, 142 of the Constitution of India

Section 96, 9, 33(3), 12(4), 13, 33(1), 42, 30, 40, 30(5) of the Code of Civil Procedure 1908

Section 4, 3(1)(a) of the Repeal Act (15 of 1999)

Section 10(3), 8(4), 10(1), 10(5), 10(6), 5(3), 27, 27(1), 6 of the Urban Land (Ceiling and Regulation) Act 1976

Sections 209 and 331 of the U.P. Act 1 of 1951

Brief Facts & Procedural History

1. The first respondent filed a suit in the Court of the Civil Judge (Senior Division), Moradabad, claiming to be the “transferable owner and cultivator” of lands in village Sonakpur, in the city and district of Moradabad, consisting of Gata No. 200/1 admeasuring 0.1300 hectares equivalent to 1295.04 sq. mts. MDA was named as the first defendant in the complaint, while the appellant was named as the second defendant. At this point, the averments in the plaint must be mentioned. In Moradabad, a man named Zahid Hussain had the title of empty property of 6960.84 square metres. In the Court of the Competent Authority, Urban Land Ceiling, Moradabad, a ceiling case no. 437/5325 (titled State vs. Zahid Hussain) was filed against him in respect of his lands, which included the lands contained in Gata No. 200 and measuring 1295.04 sq. mts. The land in Gata No. 200, among other parcels of land, was designated "surplus" by the Competent Authority on March 16, 1988, by the Urban Land (Ceiling and Regulation) Act 1976. The State of Uttar Pradesh reportedly handed up control of the land at Gata No. 200 to the MDA in response to a Competent Authority order. Meanwhile, Zahid Hussain filed a revenue appeal against the ruling with the District Judge in Moradabad. The District Judge granted the appeal and returned the case to the Competent Authority for reconsideration based on an updated Master Plan.

2. The plaintiff claims that Zahid Hussain was the previous owner and occupant of a 0.32-acre plot of property known as Gata No. 200. MDA purchased 0.05 acres (equal to 0.0200 hectares or 200 sq. mt.) of land from the aforementioned holding, following the terms of the Land Acquisition Act, 1894. Gata No. 200 was separated into two plots after the acquisition:

a. Gata No. 200/1 is 0.1300 hectares (1300 square metres) in size; 

b. Gata No. 200/2 is 0.2000 hectares in size (200 sq. mt.)

3. MDA is said to have become the owner of Gata No. 200/2, whereas Zahid Hussain is said to have become the owner of Gata No. 200/1. The plaintiff claims that after the ceiling case was remanded to the Competent Authority and while it was pending, Zahid Hussain obtained permission from the Office of the Prescribed Authority, Urban Land Ceiling, Moradabad on 5 May 1993 to sell the lands located in Gata No. 200/1 to the first respondent. By a recorded sale transaction dated June 22, 1993, the first respondent claims to have bought Gata No. 200/1, measuring 1295.04 sq. mt., from Zahid Hussain. Urban Land (Ceiling and Regulation) Act 1976 was abolished by Act 15 of 1999 (“Repeal Act”) while the ceiling case was pending before the Competent Authority. In light of Section 4 of the Repeal Act (15 of 1999), which specifies that procedures pending before any court, tribunal, or authority should be abated, the Competent Authority (City Land Boundary), Moradabad issued an order dismissing Case No. 437/5325.

4. The eclipse of the ceiling over Gata No. 200/1, measuring 1295.04 sq. mt., was allegedly removed in this manner. The plaintiff – first respondent claimed possession of the full 1295.04 sq. mt. of land, whereas MDA claimed ownership of Gata No. 200/2 in respect of 200 sq. mt. of land. MDA issued an auction and sale notice for 600 square metres of land in Gata No. 200. The first responder alleges that he or she filed objections to the auction. The first respondent filed a writ case in the High Court contesting the sale against the state of Uttar Pradesh and MDA. The petition was dismissed by the High Court, but the first respondent was given the option of filing a civil suit to obtain redress. The auction sale in favour of the appellant was allowed, and a sale document was signed between the MDA and the appellant for Rs. 65,75,000 in consideration.

5. The first respondent challenged the auction proceedings in the suit because MDA only had title to the land measuring 200 square metres (Gata No.200/2) of the auctioned land, and thus the sale of the remaining 400 square metres was null and void in light of Zahid Hussain's sale deed in favour of the first respondent on June 22, 1993. The reliefs sought in the original complaint were:  

a. A determination that MDA's sale of 400 square metres of the property was unlawful and void; and

b. A permanent injunction prohibiting MDA from transferring the suit land in favour of the appellant and dispossessing the first respondent.

6. The plaint was amended to ask for: 

a. A declaration that MDA's auction of 660.32 square metres of land was illegal and void;

b. A declaration that the first respondent is the sole owner and occupier of the suit lands detailed in the schedule (B), including the suit lands in schedule A; and

c. A permanent injunction against dispossessing the first respondent.

7. The complaint named Shri Sai Siddhi Developers as the third defendant. The revised plaint asserted that before Zahid Hussain conveyed the property to the first respondent, he had received authorization from the Competent Authority in Moradabad.

8. The Trial Court found that it had jurisdiction to give declaratory and injunctive relief and that the complaint was consequently maintainable in its ruling dated October 18, 2011. The action was rejected by the Trial Court, which determined that the MDA was the rightful owner of the land and that the auction performed on September 12, 2008, was legal. The following conclusions were reached by the Trial Judge:

a. Zahid Hussain was the previous owner of Gata No. 200, which measures 1295.04 square metres and is located in Sonakpur, Moradabad;

b. A total holding of 2,000 sq. mt. out of 6960.84 sq. mt. the land was declared retainable by the Competent Authority in Ceiling Case No. 437/5325 under the Urban Land (Ceiling and Regulation) Act 1976, while the balance admeasuring 4960.84 sq. mt. was declared surplus;

c. The lands admeasuring 1295.04 sq. mt. in Gata No. 200 were found to be ‘excess vacant land’;

d. The Naib Tahsildar Urban Land Ceiling, Moradabad, on behalf of the District Collector, handed over possession of 1295.04 sq. mt of Gata No.200 in village Sonakpur to the Naib Tahsildar of MDA. The fact that control of the suit land had been given over to the MDA was not brought to the attention of the court when an appeal was filed against the ruling before the District Judge in Moradabad. In any case, the matter was remitted to the Competent Authority so that the modified Master Plan may be considered. In the meanwhile, before the District Judge's order, MDA was given possession of 1295.04 sq. mt of Gata No. 200, making it the legal owner of the aforementioned land in Gata No. 200;

e. Zahid Hussain, who is said to have sold the land to the first respondent plaintiff, had not been in court, nor had the original sale deed allegedly completed by him, been submitted with the court. There was just one certified copy of the selling deed submitted;

f. MDA, to whom the lands were transferred on July 31, 1992, was not a party to the revenue appeal before the District Judge, nor had the Competent Authority, in its order, abating the proceedings in the ceiling case, directed that "possession" be restored to Zahid Hussain; 

g. Possession had already been transferred to MDA, and the acquisition would not be contested;

h. According to the first respondent, Zahid Hussain got authorization to sell 1295.04 sq. mt. of Gata No. 200/1 lands on May 5, 1993. Because Zahid Hussain no longer owned 1295.04 sq. mt of Gata No. 200/1, the entire process seemed to be contrived. On July 31, 1992, the possession of Gata No. 200 was transferred to MDA. Furthermore, Zahid Hussain was given the authorization to sell the lands on May 5, 1993, but only for his retainable holdings admeasuring 2000 sq. mt., which did not include the property in Gata No. 200/1; and

i. Zahid Hussain had no right to transfer the suit lands since an order had already been issued under Section 8(4) of the Urban Land (Ceiling and Regulation) Act 1976 [in line with the law given down by this Court in Ritesh Tiwari & Ors. v. State of U.P. & Ors. 2011 (84) A.L.R. 292 (SC)].

9. The appeal goes to the High Court of Judicature at Allahabad challenging the order of the Trial Court.

10. The High Court, in a ruling dated February 22, 2018, overturned the Trial Court's verdict and decree. While allowing the appeal, the High Court's Division Bench noted that:

11. On 6 January 1993, the District Judge in Moradabad approved the appeal against the Competent Authority's ruling dated March 16, 1988, and the Competent Authority was ordered to reconsider the case after taking into account the revised Master Plan.

12. In the meanwhile, on September 27, 1988, a notification was issued under Section 10(1) of the ULCLRA vesting excess land in the State, including Gata No. 200, measuring 1295.04 sq. mt.; No information was available on whether any further procedures were conducted; It was unclear when the Competent Authority took ownership of the landowner under the Urban Land (Ceiling and Regulation) Act 1976; The letter dated July 31, 1992, addressed to the Competent Authority, Urban Land Ceiling, Moradabad, stating that possession had been handed over by the Naib Tahsildar, Urban Land Ceiling, MDA, is only to demonstrate a "paper possession" and not "actual physical possession" under Section 10(5) or 10(6) of the Urban Land (Ceiling and Regulation) Act 1976. Possession should have been taken by drafting a panchnama for "actual possession" to have been taken.

13. The decision declaring the land excess would no longer exist since an appeal against the order dated March 6, 1988, was granted on January 6, 1993, remanding the case to the Competent Authority. As a result, there would be no doubt about the State receiving a legal title or seizing possession. The ensuing procedures would be null and invalid, and Zahid Hussain's land would remain his.

14. No additional notification under Section 10(3) of the Urban Land (Ceiling and Regulation) Act 1976 was issued after the issuing of a notification under Section 10(1) on September 27, 1988. As a result, the question of the land's presumed physical ownership and vesting in the State Government would not arise. Even though the Repeal Act applies to presumed possession, it only prevents actions when real possession has been obtained under Section 10(5) (peaceful or voluntary) or Section 10(6) (forcible possession).

15. Apart from the letter of possession dated July 31, 1992, which was simply a paper transaction, there was no mention of real possession being taken in MDA's written declaration. This letter isn't even a possession memo transferring ownership to MDA.

16. The land contained in Gata No. 200, admeasuring 1295.04 sq. mt., remained the property of Zahid Hussain in the absence of actually taking over of ownership and turning over of possession to MDA on the execution of the Repeal Act; and

17. The fact that possession procedures under Section 10(5) had not been initiated was mentioned in a Competent Authority judgement dated June 15, 2001.

18. The appeal goes to the Honourable Supreme Court of India challenging the order and judgment passed by the High Court of Judicature at Allahabad. 

The Issue(s) of the Case

Whether the impugned judgment dated 22 February 2021 passed by the High Court of Judicature at Allahabad valid?

The Observations of the Court

1. Honourable Supreme Court of India observed that the appellant had objected to the Trial Court's authority to hear the case, claiming that an injunction and declaratory relief could not have been granted. Even though the Trial Court issued a judgement in favour of the appellant, it found against him on the issue of jurisdiction. The appellant did not file a memorandum of cross-objection before the High Court to contest this conclusion. Neither the appellant nor the MDA raised a claim of lack of jurisdiction, according to the High Court's decision. The appellant has not filed the counter-affidavit it filed in the High Court Honourable Supreme Court of India. As a result of the material before us, it may conclude that the appellant only addressed the issue of jurisdiction before the Trial Court and not before the High Court. In essence, the Honourable Supreme Court of India would have to rule on a claim that was not included in the High Court's ruling in the case before us.

2. Referring to the case of Bharat Kala Bhandar (P) Ltd. v. Municipal Committee AIR 1966 SC 249, The Honourable Supreme Court of India heard a civil appeal in which a claim that had not been mentioned in the action or the grounds of appeal before the High Court was made for the first time before the Honourable Supreme Court of India. Although the Court stated that the scope of the appeal cannot be expanded at the request of the parties, a plea that presents a significant point can be considered by the Honourable Supreme Court of India.

3. Referring to the case of Vasant Kumar Radhakisan Vora v. Board of Trustees of the Port of Bombay (1973) 2 SCC 474, The Supreme Court of India stated that under Article 136 of the Constitution, pure legal concerns that go to the heart of a case's jurisdiction might be presented for the first time in an appeal.

4. Referring to the case of Most Rev. P.M.A. Metropolitan v. Moran Mar Marthoma 1995 Supp (4) SCC 286, Moreover, despite the petition not having been brought before the lower courts, a three-judge panel of the Honourable Supreme Court of India heard an objection to the suit's maintainability under Section 9 of the Code of Civil Procedure, 1908. Because an order or decision issued without jurisdiction is non-est in law, the Court noted that the plea of bar or lack of jurisdiction might be heard at any point.

5. Honourable Supreme Court of India observes that the true goal and objective of the lawsuit, which was filed under the appearance of contesting MDA's auction notice, was to affirm the first respondent's title based on a purported permit for the sale of the property, Zahid Hussain's deed of transfer, and the Urban Land (Ceiling and Regulation) Act 1976's abatement of proceedings. The High Court ruled that the document used to transfer possession to MDA is only a paper transaction rather than evidence of genuine physical possession. The High Court held that no evidence had been presented as to whether the Competent Authority had taken actual and physical possession of the land from the landowner, and that in the absence of such evidence, the first respondent, as the purchaser from Zahid Hussain, would continue to have a valid title. Even though the first respondent sought no relief about the proceedings under the Urban Land (Ceiling and Regulation) Act 1976 (to avoid a bar to the suit's maintainability) and did not implead either the State or the Competent Authority who would have been in a position to answer the challenge, the High Court made these findings.

The Decision Held by the Court

Honourable Supreme Court of India Allow the appeal and vacate the impugned High Court ruling of February 22, 2018. The lawsuit brought by the first respondent is dismissed. The first respondent must pay the appellant's expenses in the amount of Rs. 50,000.

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