NARANBHAI DAYABHAI PATEL AND ANR.versusSULEMAN ISUBJI DADABHAI

                                                                                   ,
A                   NARANBHAI DAYABHAI PATEL AND ANR.
                                          v.
                           SULEMAN !SUBJ! DADABHAI

                                   JANUARY 11, 1996

B                  [K. RAMASWAMY AND G.B. PATTANAIK, JJ.]


            Bombay Tenancy & Agricultural Lands Act, 1948 :

          Section 32-Tenant becoming a deemed purchaser-Erstwhile land-
C   holder creating a trust in which he was the trustee-beneficiary-No notice
    given to the deemed purchasei--Held : He is entitled to be heard b~fore
    granting registration to the trust.

            Letters Patent Act :

D         Clause 15--Statutory co1iferment of supervisory jurisdiction-Exercise
    of-Appeal thereon-Letters Patent Appeal would not lie to Division Bench
    unless certificate for leave to appeal is granted by the Single Judge.

          Maneksha Ardeshir lrani & Anr. v. Manekji Edulji Mistry & Ors., [1975]
    2 SCR 341 and Ramachandra Goverdhan Pandit v. Charity Commissioner of
E   State qf Gujarat, [1987] 2 SCR 1083, relied on.

            CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3248 (N) of
    1979.

          From the Judgment and Order dated 27.7.79 of the Gujarat High Court
F
    in L.P.A. No. JO of 1976 in P.A. No. 347 of 1968.

            Sakesh Kumar for Mis. Hathi & Co., for the Appellants.

            Mukul Mudgal for the Respondent.
G           The following Order of the Court was delivered :

         This appeal by special leave arises from the Judgment of the Division
    Bench of the Gujarat High Court in L.P.A. No. 10n6 dated July 27, 1979.
    The undisputed facts are that the Bombay Tenancy & Agricultural Lands Act,
H   1948 (for short, 'the Tenancy Act') was amended from time to time. The
                                          382
                         N.D. PATEL v. S.I. DADABHAI                        383
Amendment Act, 1956 had come into force on August 1, 1956. By operation             A
of Section 32 of the Tenancy Act, the tenant has become a deemed purchaser
w.e.f. April 1, 1957 which is envisaged by the Act as the "Tillers' day". The
erstwhile land-holder, the respondent on December 12, 1956 terminated the
tenancy of the appellants and filed the Trust deed before the Assistant Charity
Commi.ssioner under Section 18 of the Bombay Public Trusts Act, 1950 (Born.         B
Act XXIX of 1950) (for short, 'the Act') for registration. On January 31,
1957, the Trust was registered without any notice to the appellants. Against
the said registration, the appellants carried the matter in appeal to the Charity
Commissioner under Section 70 of the Act. But the Charity Commissioner by
his order dated August 8, 1957 dismissed the appeal holding that "It is difficult
to accept this argument". A trust is a mode of transfer known to law and if
                                                                                    c
the legislature really wanted a transfer by way of a trust also to be prohibited,
it could have so mentioned. A gift as defined in Section 122 of the Transfer
of Property Act "cannot be said to include a trust". Against the said judgment,
the appellants filed before the District Judge an appeal on October 4, l 957.
The Assistant Judge, Surat in Misc. Appln. No. 64 of 1957 by his order dated        D
August 18, 1967 held that "From the aforesaid comments, it will be seen that
a distinction is made about the vesting declaration and it has not been
mentioned therein that the vesting declaration would tantamount to a gift."
Accordingly, it had confirmed the order of the Assistant Commissioner. The
appellants further carried the matter in appeal. The learned single Judge in        E
First Appeal No. 347 of 1968 by Judgment and decree dated September 22,
 1975 set aside the order and held that the Mamlatdar in his proceedings under
Section 32 had held that the appellants became the deemed purchasers by
operation of Section 32. The respondent allowed that order to become final.
Therefore, the land having been vested in the tenant by statutory operation of      F
Section 32, the creation of the trust and registration thereof under Section 18
of the Act is not valid in law. Further a Letters Patent Appeal was carried and
the Division Bench reversed the findings and held that there cannot be a
transfer by a single person in his capacity as an individual and at the same time
as a trustee beneficiary and that, therefore, it cannot be construed to be a gift
under Section 122 of the Transfer of Property Act. The creation of the trust        G
and registration thereof under Section 18 are valid in law. Thus this appeal by
special leave has been filed.

     Since the respondent, though served, had not appeared either through
counsel or in person and since an important question of Jaw has arisen, we          H
    384                      SUPREME COURT REPORTS                  [1996] I S.C.R.
A   requested Sri Mukul Mudgal, the learned counsel to assist this Court as amicus
    curiae and he has rendered valuable assistance by making thorough study and
    filing written submissions. We record t~e valuable assistance rendered by him.
    The question is : whether the creation of the trust on the facts of this case is
    valid in law? It is seen that, as found by the learned single Judge of the High
B   Court, pursuant to the proceedings taken under Section 32 declaring that the
    appellants were the deemed purchasers, they became deemed tenants on Till-
    ers' day on April I, 1957. The order was allowed to become final. Therefore,
    it binds the respondent, erstwhile owner of the land. The lands stood vested in
    the appellants. The responden~ thereby got divested his right as owner since
    the tenant became owner by statutory purchase. The question then is : whether
c   the respondent could create a trust bequeathing the property as gift to the trust
    to which he also is the beneficiary? It is contended by Shri Mukul Mudgal,
    learned counsel that in view of the judgment of this Court in Maneksha Ardeshir
    Irani & Anr. v. Manekji Edulji Mistry & Ors., [1975] 2 SCR 341, the tenant
    has no right under Section 88-B of the Act to be heard before the permission
D   is granted by the Collector under the Tenancy Act and that, therefore, though
    the Mamlatdar granted the order under Section 32, the appellant had no right
    to be heard in the matter. We are unable to agree with Shri Mudgal in his
    contention. It is seen that the order of Mamlatdar passed under Section 32 had
    become final. Thereby, the erstwhile land owner had been divested of his title
E   to the property w.e.f. April I, 1957. All to which he is entitled is the compen-
    sation in the manner prescribed under the Act. It is true that at the time of the
    registration of the trust, strictly the tenant is not entitled to be heard provided
    he has no pre-existing right in the land, the subject matter of bequeath. In the
    enquiry under Section 88-B, question relating to two aspects would arise in
F   registration of trust of the kinds covered by the Act, viz., of the factum of the
    creation of the trust and the utilisation of the income derived from the land
    bequeathed to the trust towards charitable purpose. In that enquiry by the
    Collector on these two aspects, certainly the tenant has no right to say in the
    matter. But in a case where the tenant has a pre-existing right and his right is
    sought to be divested in creating the trust, certainly he is an interested person
G   to be vitally affected by the registration of the trust. Consequently, when the
    proceedings under Section 18 of the Act was taken, as envisaged in Section 19
    of the Act, the tenant being an interested person is entitled to be heard. In .
    Maneksha Ardeshir Erani's case (supra) this Court had held at page 344 thus:

H            "The appellant at no stage denied the fact that the lands are the
                         N.D. PATEL v. S.l. DADABHAI                          385
         property of a trust. The inquiry is between the Collector and the            A
         trust. The conclusive evidence clause in the Section means that it
         is a rule of evidence which would not render it necessary for it to
         prove again the compliance with the requirements."

      The High Court in that case had held that the appellant had at no stage
denied the fact that the lands were the properties of the trust. In the backdrop
                                                                                      B
of those facts, this Court concluded that the tenant was not entitled to be heard.
As stated earlier, when the tenant has a pre-existing right and he is divested
of that right and by operation of the provisions of the Act he is precluded to
file a suit challenging the correctness of the registration of the trus~ certainly,
he is a person vitally interested to defend his right, title and interest in the      C
property. Therefore, he is a person interested to be heard before registration
of the trust. In this case, admittedly, no notice was issued nor was he heard.
It is clear from the proceedings that, as a fact, the registration was taken up
by the Assistant Charity Commissioner on January 31, 1957 and on the same
day the registration was granted. The enquiry contemplated under Section 19           D
was given a ceremonial send off without being complied with. Under those
circumstances, the learned single Judge was right in concluding that since the
order passed under Section 32 was not assailed by the respondent, the
appellants were entitled to be heard before granting registration for the trust
and vesting the same in the trust.
                                                                                      E
       The question then is : whether the Division Bench was right in
interfering with the order. It is contended that clause 15 of the Letters Patent
Act is not available to the respondent and that, therefore, the Letters Patent
Appeal would not lie. This point is squarely covered by the judgment of this
Court in Ramachandra Goverdhan Pandit v. Charity Commissioner of State                F
of Gujarat, [1987] 2 SCR 1083. In that case on suo motu enquiry under the
Act, the Deputy Commissioner had held that the properties were of public
interest. On appeal, the Charity Commissioner confirmed and dismissed the
appeal. Appeal under Section 72 of the Act was preferred to the District Court
and the District Court dismissed the same. When the first appeal was filed in         G
the High Court, the learned single Judge dismissed the appeal. In the letters
Patent .0.ppeal the question arose : w~ether an appeal would lie against the
decision of the learned single Judge. This Court examined the controversy and
concluded at page 1089, thus :

         "The power of this District Court in exercising jurisdiction under           H
    386                      SUPREME COURT REPORTS                   [1996] l S.C.R.

A            Section 72 is a plenary power. It is true that the Commissioner is not
             subordinate to the District Court but the District Court has powers to
             correct, modify, review or set aside the order passed by the Commis-        t
             sioner. All the characteristics of an appeal and all the powers of an
             appellate Court are available to the District Court while deciding an
             application under Section 72. To decide this case we must be guided
B
             not only by the nomenclature used by the Section for the proceedings
             but by the essence and content of the proceedings. That being so, we
             have no hesitation to hold that the proceedings before the District
             Court under Section 72( 1) are in the nature of an appeal and that
             District Court exercises appellant jurisdiction while disposing of a
c            matter under Section 72(1). Consequently, the Single Judge of the
             High Court while deciding the appeal, from the order of the District
             Court deals with a matter made by the District Judge in the exercise
             of an appellate jurisdiction by a Court subject to the superintendence
             of the High Court and hence clause 15 of the Letters patent is directly
D            attached."

          Consequently, this Court had held that the Letters Patent Appeal against
    the decision of the learned single Judge did not lie. The same ratio applies to
    the facts in this case. Leave of the learned single Judge was admittedly not
    obtained for filing the appeal. Consequently, since the appeal of the learned
E   single Judge arises under the Act by virtue of the statutory conferment of
    supervisory jurisdiction, by operation of earlier part of clause 15 of the Letters
    Patent Act would vest in him. The Letters Patent Appeal would not lie to the
    Division Bench unless the certificate of the learned single judge has been
    granted for leave to appeal. Jn that view, the appeal to the Division Bench was
F   incompetent and is accordingly set aside.

           The appeal is allowed accordingly. No costs.

    G.N.                                                            Appeal allowed.