Holding

Section 76 and Explanation II to Section 2(22) of the 1987 Act are invalid and unconstitutional to the extent they divest vested rights granted under the Inams Abolition Act.

Summary

The petitioners challenged the constitutional validity of Explanation II to Section 2(22) and Section 76 of the Andhra Pradesh Charitable and Hindu Religious Institution and Endowments Act, 1987, arguing that these provisions unlawfully divested vested rights created by the Andhra Pradesh (Andhra Area) Inams (Abolition and Conversion into Ryotwari) Act, 1956. The State contended that the legislature was competent to abolish hereditary service rights and to treat such lands as religious endowments. The Court examined whether the legislature could, by a side‑wind amendment, nullify the earlier Inams Abolition Act without expressly repealing it, and whether the 1987 provisions were constitutionally valid. It held that the Inams Abolition Act is a complete code granting absolute title to ryotwari patta holders, and that the 1987 Act, based on an erroneous assumption of law, could not divest those vested rights. Consequently, Section 76 and Explanation II to Section 2(22) were declared invalid and unconstitutional. The writ petition was allowed.

Issues considered

Whether the legislature, by a side‑wind amendment without expressly repealing the Inams Abolition Act, could nullify vested rights and treat occupants as encroachers.
Whether Explanation II to Section 2(22) and Section 76 of the Andhra Pradesh Charitable and Hindu Religious Institution and Endowments Act, 1987 are constitutionally valid.

Subjects

constitutional validityvested rightsrepealreligious endowmentryotwari pattastatutory interpretationnon obstante clauseland reforminams abolition

Judgment

PEDDINTt VENKATA MURALI RANGANATHA A
DESIKA IYENGAR AND ORS.
v.
GOVERNMENT OF ANDHRA PRADESH AND ANR.

JANUARY 12, 1996
B
[K. RAMASWAMY AND B.L. HANSARIA, JJ.]

' A.P. Charitable and Hindu Religious Jnstitutious and Endown1ents Act,
19/l7 :

Explanation 11 to Section 2(22) and Section 76--Constitutional validity
c
of.

A.P. !nams (Abolition and Conversion into Ryotwari) Act, 1956 :

Religious Institution--Te11ants, Archakas, S€!rviceholders and En1ploy- D
ees of-Land held 011 the basis o.f ryotwari patta granted under Inanis
Abolition Act-Divesting right, title and interest held in land-bnplied repeal
of the !nams Abolition Act-Removal of .foundation of judgments of High
Court held not valid-Section 76 wul Explanation 11 to section 2(22) of 1987
Act held unconstitutional.
E
Interpretation of Sratutes

Repeal-Presumption against in1p/ied repeal-Ba.\·is of-Legislature
. has co1nplete kno~vledge o.f pre-existing laws.
F
In this writ petition, the constitutional validity of Explanation II to
Section 2(22) and Section 76 of the Andhra Pradesh Charitable and
Hindu Religious Institution and Endowments Act, 1987 has been chal-
lenged. On behalf of the petitioners it was contended that by grant of
ryotwari patta under the Andhra Pradesh (Andhra Area) loams (Aboli-
tion and Conversion into Ryotwari) Act, 1956 the Archakas, service G
holders or employees covered under the Act became absolute owners of
the property. The legislature, therefore, was devoid of competence to
make the law, employing non-obstante clause, to take away their vested
rights without compensation. On behalf of the State it was contended
that since the legislature abolished hereditary rights of archakas, service H
439
440 SUPREME COURT REPORTS [1996J l S.C.R.
A holders or other employees and introduced payment of salary for them,
it was competent to enact Section 76 and Explanation II to the definition
of 'endowment' under Section 2(22) divesting their title and vesting the ..
same in the endowment or institution as the case may be.

On the questions :
B
(i) whether the legislature, by a side-wi.nd, without suitably amend-
ing the Inams Abolition Act, as interpreted by the High Court, repealing
it, could directly nullify the said law laid by the Court and divest under
Section 76 of the Act, the vested right and declare that the land was not j..

covered by said ryotwari patta or shall not be deemed to have been
c transferred and could treat such persons as encroachers?

(ii) Whether Explanation II to Section 2(22) and Section 76 of the
1987 Act were constitutionalJy valid?

Allowing the petition, this Court
D
HELD : 1. Without amending the law under Inams Abolition Act and
without properly removing the foundation of the judgments rendered by
the High Court, the legislature sought to destroy the effect of the law in
Inam Abolition Act on erroneous belief or assumption that it did not bind
the religion or charitable institutions or endowment or that the holder of
E land did not acquire title or no patta was granted to him and the land was
still with the institution and treated the occupant as encroacher. The
legislation founded on such erroneous assumption does not have the effect
of depriving the holder of the land of their vested rights acquired under
the loams Abolition Act. The legislature has plainly misfired. Accordingly,
F Section 76 and Explanation II to Section 2(22) of the Act to that extent are
"'
invalid and unconstitutional. [453-A-C]

2. The Inam Abolition Act is a complete code in itself and gives •
over-riding effect to any law inconsistent there-with creating vested
rights over the former inam lands which ceased to exist on the grant o(
G ryotwari patta. Being a ryotwari land held by a tenant, an archaka, a
service holder or other employee after grant of ryotwari patta, holds the
land with absolute right to the extent of 1/3 land as an independent and
absolute owner. The pre-existing relationship with the government was
created by imposition of ryotwari assessment. Section 12 fastens the
H liability to pay ryotwari settlement to the Government. Thereby, the
}
'
P.V.M.R.D. IYENGAR 11 GOVT OF AP. 441
whole of inam service existing prior to the grant of ryotwari patta ceased A
to have any statutory effect. The liability to render service ceased.
Thereby independently, the service holder became entitled to hold the
land in his own right as a holder of land held by him with absolute right,
title and interest in the said land and to enjoy the property with heritable
rights or right to alienation, gift over, bequeath etc. The Act did not B
make any direct attempt to repeal the provisions of the lnams Abolition
Act. It did not directly attempt to extinguish the right, title and interest
of ryotwari settlement created under the Inams Abolition Act nor
acquired the same under the Act. [450-B-F]

The lnconie-tax 0.ffii:er, Kanpur & Ors. v. Maui Rain and Ors., AIR c
(1969) SC 543; Inland Revenue Commissioner v. Dowdall. O"Mahoney and
Co. Ltd.• (1952) AC 401; Nalinikallf Ambalal Mody v. Commissioner of
Income-tax. Bombay, AIR (1967) SC 193; Hariprasad Shivshankar Shukla
& Anr. v. A.D. Divelkar & Ors., AIR (1957) SC 121; Sri Janardhanaswamy
Veru Te111ple, Kopperapadu, Onf{ole Taluk, Guntur Distrh:t, represented by its D
Managing Trustee v. The Assistant Collector, Guntur Di.\·trict & Anr., (1964)
2 An. W.R. 139; Boppudi Pu111iiah & Ors. v. Sri Lakshmi Narasin1haswaniy
Veru & Ors., (1963) 2 AWR 214 and Sri Bhavanarayanaswami Vari Temple
v. Chintapudi Rudraiah, AIR (1986) 1 ALT 444, referred to.
' E
Sanvan Singh & Anr. v. Kasturi Lal, (1977) 2 SCR 421, distinguished.

3.1. It is settled law that repeal of an Act divesting vested rights is

.. always disfavoured. Presumption is against repeal by implication and the
reason is based on the theory that the legislature, while enacting a law,
has complete knowledge of the pre-existing law on the same subject F
matter. 'A legislation proceeding upon an erroneous assumption of the
existing law without directly amending or declaring the law is ineffective
to change the law.' [450-F-H]

G.P. Singh, Principles qf Statutory lnte111retation 5th edn. 1992, 186-
G
187, referred to.

3.2. The Inams Abolition Act has given absolute right, title and
interest over the land held by an archaka, service holder or employee etc.
Section 76 of the Act by indirect process, without direct repeal of the
Inams Abolition Act or divesting the title, which became final after H
442 SUPREME COURT REPORTS [ 1996] I S.C.R.
A conjunction into ryotwari land, attempted to defeat them. [452-B-C]

CIVIL ORIGINAL JURISDICTION : Writ Petition,(C) No. 1459 of
1987.

(Under Article 32 of the Constitution of India.)
B
K. Parasaran, R. Venugopal Reddy, Dr. V. Gauri Shankar, P.P. Rao, A.
Raghuvir, A.K. Ganguli, H.S. Gururaja, M.N. Krishnamani, Ms. Shyamla
Pappu, Ms. Mridula Ray Bharadwaj, Dr. Sumant Bhardwaj, Mohan Parasaran,
V. Balachandran, P.N. Ramalingam, A.D.N. Rao, T.V. Ratnam, Subodh
C Markandeya, Ajay Singh Mrs, Chitra markandeya, Sunil Kumar Jain for M/
s Jain Hansaria & Co., G Parabhakar, B. Kanta Rao, S. Rajappa,Mrs. H.
Wahi, R. Ashok, B. Parthasarathi, K. Rajendra Chowdhary, Y. Prabhakar Rao,
M. Dorairaj, V. Bal~ji, A.T.M. Sampath, A. Subbarao, A. Raghunath, K.
Swamy, Ms. Thilagavathi, N.D.B. Raju, N. Ganapathy, K. Ramkumar, Ms.
Asha Nair, C. Balasubrarnaniam, Adinarayana Raju, T.V.S.N. Chari (NP),
D P.K. Pillai, G. Venkatesh Rao, Ms. Sadhana Rarnachandran, Mr. Ranganadhan,
Sunil Kumar Jain, Pramod Sharma, and R.C. Pathak for the Appearing
parties.
'

The Judgment of the Court was delivered by
E
'
K. RAMASWAMY, J. The petitioners are challenging the constitu-
tionality of Explanation II to Section 2(22) and Section 76 of the Andhra
Pradesh Charitable and Hindu Religious Institution and Endowments Act,
1987 (30 of 1987) (for short, "the 'Act") in this writ petition, apart from other
provisions of the Act challenge to which is decided in other connected
F matters. In this case we confine our consideration to the validity of the above
provisions. It is contended in the writ petition and argued by Shri R.
Venugopal Reddy, their learned senior counsel, that ryotwari pattas having
been granted under the Andhra Pradesh (Andhra Area) Inams (Abolition and
Conversion in Ryotwari) Act (37 of 1956) (for short, "the Inams Abolition
G Act") and the same having attained finality, the legislature is devoid of power
under the Act to set at naught the effect of the grant of ryotwari patta to the
archakas, service holders or employees covered under the Act by a legislative
side-wind. It is their case that by grant of ryotwari patta in favour of the
aforesaid persons, they became absolute owners of the property. The Jegisla-
H ture, therefore, is devoid of competence to make the Jaw, employing 1w11
P.V.M.R.D. IYENGAR v. GOVT. OF A.P. [RAMASWAMY, J.] 443
obstante clause, to take away their vested rights without compensation. Shri A
.,,
- P.P. Rao, learned senior counsel for the State, contended that since the
legislature ·abolished hereditary rights of archakas, service holders or other
employees and introduced payment of salary for them, the legislature is
competent to enact Section 76 and Explanation II to the definition of
'endowment' under Section 2(22), divesting their title and vesting the same B
in the endowment or institution as the case may be.

Section 2(22) of the Act defines religious endowment thus :

-'- Section 2(22) - 'religious endowments' means property (including
movable property), and religious offerings whether in cash or kind, c
given or endowed for the support of a religious institution or given
or endowed for the performance of any service or charity of a 'public
nature connected therewith or of any other religious charity; and
includes the institution concerned and also the premises thereof.
D
' :.
Explanation II : Any Inam granted to an archaka, service holder or
other employee of a religious institution for the performance of any
service or charity in connection with a religious institution shall not
be deemed to be a personal gift to the archaka, service-holder or
employee, notwithstanding the grant or ryotwari patta to all archaka,
E
service holder or employee under the Andhra Pradesh (Andhra
Area) loams (Abolition and Conversion into Ryotwari) Act, 1956
but shall be deemed to be a religious endowment."

.. A reading of the section would show that religious endowment means
property including movable property given or endowed for the support of a F
religious institution or given or endowed for the performance of any service
or charity of a public nature connected therewith or of any religious charity
and includes the institution connected and also the premises thereof. Any
Inam granted to an archaka, service holders or other employees of a religious
institution for the perfonnance of any service or a charity in connection with G
the institution shall be deemed Lo be a personal gift to the archaka, service
,._, holders or employee, notwithstanding the grant of ryotwari patta to all
archakas, service holders or employees under the loams Abolition Act, but
shall be deemed to be a religious endowment. Section 76 of the Act reads
thus : H
444 SUPREME COURT REPORTS [1996] l S.C.R.

A "76. Prohibition of transfer of lands granted for rendering service to·
a religious or charitable institution or endowment :

(1) Where, before or after the conunencement of this Act, any
person has been granted a ryotwari palla in respect of any inam land
given to a service holder or other employee of a charitable or
B religious institution or endowment for the purpose of rendering
service to the institution or endowment then, notwithstanding t.o the
contrary in any other lav.1 for the time being in force or in the deed
of grant or of transfer or other document relating to such land it >
shall be and shall be deemed never to have been granted and the
c lands covered by such ryotwari patta shall not be transferred and
shall be deemed never to have been transferred and accordingly no
right or title in such land shall vest in any person acquiring the land
by such transfer and a ryotwari patta in respect of such land shall be
deemed to have been granted in favour of the institution or
D endown1ent concerned and thereafter the person in possession of
such land shall be deemed as an encroacher and the provisions in
'
Section 84 and 85 and shall apply.

(2) No ryotwari patta holder in respect of the aforesaid land shall
transfer any such land and no person shall acquire any such land
E either by purchase, gift, lease, mortgage, exchange or otherwise.

(3) Any transfer or acquisition made in contravention of the
provisions in sub-Section (I) or sub-section (2) shall be deemed to
be null and void. •
F
(4) The provisions of Section shall apply to any transaction of the.
nature referred to in sub-Section (2) in execution of a decree or
order of a civil court or any order or any other authority."

Section 76, as amplified by its marginal note indicates prohibition of
G transfer of land granted for rendering service to a religious or charitable
institution or endowment. Sub-Section (I) adumbrates that where, before or
after the commencement of the Act any person has been granted a ryotwari
patta in respect of any inam land to a service holder or other employee of a
charitable institution or endowment for the purpose of rendering service to
H the institution or endowment, notwithstanding anything to the contrary in any
)
P.V.M.RD. IYENGAR v. GOVT. OF A.P. [RAMASWAMY, J.] 445
other law for the time being in force or in the deed of grant or of transfer A
,,,.. or other docu1ncnts relating to such land and shall be deen1ed never to have
been granted an<l the lands covered by such ryotwari patla shall not be
transferred and shall be dee111ed never to have been transferred. Accordingly,
no right or title in such land shall vest in any person acquiring the land by
such transfer an<l a ryotwari patla in respect of Such land shall be deemed B
to have been granted in favour of the insti.tution or endowrnent concerned.
Thereafter, the person in possession of such land shall be deerned as an
,. encroacher and the provisions of Sections 84 and 85 of the Act shall apply.
1. Equally, sub-section (2) issues an injunction against the holder of ryotwari
patta to transfer such land. The purchaser or a person acquiring such land
either by purchase, gift, lease, mortgage, exchange or otherwise acquires not
c
'title to such land. Such a transfer was declared null and void by operation
of sub-Section (3). Even an order or decree of a civil Court or any order or
any other authority would also meet the same fate by operation of sub-
section (4) thereof.
D
The competency of the legislature to make this law, its deep impact on
vested rights and its sweep would be properly gazed and appreciated when
we would look into the provisions of the Inams'Abolition Act which is a part
of agrarian refonn forming part of the sche1ne to abolish an estate and
conferment of -ryotwari patta on the tiller of the soil and the institution
respectively and creation of direct relationship of him with the State paying
E
revenue assessment thereof. The Inams Abolition Act was enacted under
Entry 18 of List II of the Seventh Schedule of the Constitution, viz., "Rights
in or over the land, land tenure including the relationship of the landlord and
the tenant, transfer and alienation of agricultural lands etc." The preamble of
the Inams Abolition Act envisages "an Act to abolish and convert certain F
inam lands into ryotwari lands". The title of the Act itself indicates abolition
of the inam lands and conversion thereof into ryotwari lands. The Act had
come into force on December 14, 1956 and it has been amended from time
to time. Similar provision is available in Telangana area 0f Andhra Pradesh.
Section 2(c) defines "Inam Lands" to mean any land in respect of which the
G
grant in ina1n has been made, confinned or recognised by the government
etc. Section 2(e) defines 'institution' to mean a religious or charitable or an
Ii:"'..,-. educational institution. Section 3 authorises the Tehsildar either suo 1110tu or
on an application to determine the nature of the lands, after enquiring (ii
whether a particular land in his jurisdiction is an inam land; (ii) whether such
land is in ryotwari, zamindari or inam village; (iii) whether such land is held H
\

446 SUPREME COURT REPORTS [1996] 1 S.C.R.
A by any institution. The procedure in that behalf has been provided in sub-
·+/.
sections (2) and (3) of Section 3 and the aggrieved person or institution has
been given right of appeal under sub-section (4) against the decision of the
Tehsildar to the Revenue Court within prescribed limitation therefor. Under
sub-section (5) the decision of the Revenue Court shall be final. The decision
B of the Tehsildar or Revenue Court is required to be published in the District
Gazette under sub-section (6) and also in any other prescribed manner. The
decision of the Tehsildar and the Revenue Court shall be binding, by
operation of sub-section (7). on all persons and institutions claiming an
interest in any such lands notwithstanding that such person or institution has
not filed any application or a statement or adduced any evidence or appeared
c or participated in the proceedings before the Tehsildar or the Revenue Court,
as 1he case may be. After publication, under sub-section (6) of Section 3, the
Tehsildar ha8 been invested with power under Section 4 to convert inam land
into ryotwari land. The person or institution or the tenant in occupation is
declared entitled to ryotwari patta in respect of that land. The institution is
D entitled to 2/3 and the tenant or a person or the inamdar is entitled to I/3rd
share of ryotwari patta. Therefore, the person, inamdar or an institution who '
holds the land is entitled to 2/3 and l/3 share of ryotwari patta respectively.
It has been held by the Andhra Pradesh High Court that archakas in
possession of land under ter:ms of compromise to render service cannot be
E regarded as inamdar and cannot obtain patta vide Sri Janardhanaswamy Veru
Temple, Kopperapadu, Ongole Taluk, Guntur District, represented by its
Managing Trustee v. The Assistant Collector, Guntur District & Anr., (1964)
2 An. W.R. 139.
•
Section 5 empowers re-induction of tenants who were in occupation of
F
tl1e inam land in inam villages as on 7th January, 1948 but were evicted from
such land before the commencement of the Inarns Abolition Act and were
entitled to ryotwari patta. Section 6 deals with the determination of 1/3 share
of inam land in the occupation of the tenants. Section 7 deals with the grant
of ryotwari patta and has material bearing on the question under considera-
G tion. It reads thus :

"7. Grant of ryotwari patta : ( 1) As soon as may be after commence-
.... -
ment of this Act and subject to the provisions of sub-section (4 ), the
Tahsildar may suo motu and shall, on application by a person or an
H institution, after serving a notice in the prescribed inanner on all the
I

P.V.M.R.D. IYENGAR v. GOVT. OF A.P. [RAMASWAMY, J.] 447
persons or institutions interested in the grant of ryotwari pattas in A
respect of the inam lands concerned and after giving them a
reasonable opportunity of being heard and examining all the rel-
evant records, determine the persons or institutions entitled to
ryotwari pattas in accordance with the provisions of Section 4 and
grant them ryotwari patta in the prescribed form. B

.(2) Any person or institution aggrieved by the grant of a ryotw.ari
y
patta by the Tahsildar under sub-Section (I) may appeal to the
Revenue Court within sixty days from the date of such grant, and
the revenue Court may, after giving the parties to the appeal a
reasonable opportunity of being heard pass such orders on the. c
appeals as it thinks fit.

(3) The decision of the Revenue Court under sub-Section (2), and
where no appeal is filed, the decision of the Tehsildar under sub-
•
Section ( 1), shall be final. D
(4) Where the Revenue Court declares under sub-Section (2) that a
person or an institution different from the person or institution to
whom a Tahsildar has granted a ryotwari patta under sub-Section (I)
is entitled to a ryotwari patta the Tahsildar shall cancel the ryotwari
paua granted by him and grant a fresh ryotwari patta in accordance E
with the decision of the Revenue Court under sub-Section (2).

(5) In the case of inarn lands held by the inamdar other than an
institution in an inarn village, if an application is filed under sub-
Section (2) of Section 5 within the period specified in that sub- p
Section, no tenant or inamdar shall be granted a ryotwari patta under
sub-Section (I) until the decision of the Revenue Court under sub-
Section (3) of Section 5 or of the Collector under sub-Section (5) of
that Section, as the case may be, is given."

Section 8 gives right of permanent occupancy to the tenant in inam G
land held by the institution in inam villages with the words "said right shall
be heritable and shall be transferable by sale, gift or otherwise." Sub-Section
(2) of Section 8 deals with eviction of permanent tenants for failure to pay
the rent and the procedure thereof. Section 9 deals with procedure for
evicting the tenant having right of permanent occupancy and re-grant of lease H
,
448 SUPREME COURT REPORTS [1996] l S.C.R.
A of lands taken from tenant under Section 9 is governed by Section 10.
Section JOA deals with application of the Act to inam land in ryotwari or
zamindari villages. Section JOB deals with conferment of ryotwari patta on
transfers of unenfranchised inams. Section 11 makes the provisions of the
Andhra Tenancy Act, 1956 or the Act amended thereafter, applicable to the
B lands held by the permanent tenants under the Act. Section 12 prescribes the
procedure and imposes liability on. every person or institution receiving
ryotwari patta to pay to the Government ryotwari assessment in the manner
specified thereunder. Section 14 bars jurisdiction of the civil court over the
matters covered as enumerated therein and Section 13 gives power of the
civil court to the Tehsildar, Revenue Court and the Collector as indicated
c therein. Section 14A provides a revisional jurisdiction to the Board of
Revenue over the orders passed by the Tehsildar, Revenue Court or the
Collector, as the case may be. Sub-Section (2) prohibits exercise thereof
except on compliance with the principles of natural justice adumbrating that
no order prejudicial to any person shall be passe~ under sub-Section (I)
D unless such person has been given an opportunity of making his representa-
tion. Section 15 also has a bearing on the question in issue which reads thus: '
"Act. to override other laws : Unless otherwise expressly provided in
this Act the provisions of this Act and of any orders and rules made
E thereunder shall have effect not withstanding anything inconsistent
therewith contained in any other law for the ti1ne btiing in force or
any instrument having effect by virtue of any such law''.

Section 16 gives power to the Government to remove difficulties and
Section 17 accords rule making power.
F
It would thus be clear that the provisions of the Inarns Abolition Act
are a complete code in itself providing determination of the land whether
held by the institution or the individual and declaration thereof, entitlement
to ryotwari patta by the individuals or institution who hold the land and the
G grant of ryotwari patta under Section 7 shall become final unless the same is
revised under Section 14A of the Act. The inam ceases to have effect from
the date of grant of ryotw'l.fi patta. The conferment of ryotwari patta creates
a vested right to the property held either by the institution or the individual
to the extent of 2/3 and l/3 respectively with absolute right, title and interest
H in the land. The tenant in occupation is also entitled to heritable occupancy
)
P.V.M.R.D. !YENGAR v. GOVT. OF AP. [RAMASWAMY, J.J 449
rights wilh right to alienate, exchange, gift etc. Thereafter, the pre-existing A
rights and liabilities of inam ceased.

In Bopp1uli pi111n;ah & 01:~·. v. Sn' Laksh~ni Narsi1nha.nva1n.v Vt1ru &
Ors., (1963) 2 A.W.R. 214, the applicability of the Act to service inams held
by office holders enjoying the inams and the right to grant of ryotwa.ii patta B
had fallen for consideration. The Division Bench, after an exhaustive review
of the Act, held that service inams formed a considerable proportion of inams
in the Andhra Area, be it in ryotwari or zamindari area. There is no
justification for attributing ignorance to the legislature of the existence of this
class of inams. There is, therefore, no reason to suppose that the legislature
thought of keeping out of the purview of the Inams Abolition Act this class
c
of inarrn, especially when the intendment of the Act was to abolish and
convert inam lands into ryotwari lands. The absence of a provision enabling
the authorities concerned to insist upon performance of service could not lead
to the conclusion that all service inams were excluded fro1n the purview of
the enactment. Service inams also must be held as inams governed by this
D
enactment. The ryotwari patta should, therefore, be held to have been issued
to the service holders.

Another Division Bench of the High Court to which one of us (K.
Ramaswamy, J.) was a member in Sri Bhavanarayanaswami \.iiri Ten1ple v. E
Chintapudi Rudraiah, AIR (1986) I A.L.T. 444, after exhaustive considera-
tion of the controversy, had held that a conjoint reading of Section 7 and
Form VIII and Section 12 would posit that on and from the date of the grant
of the ryotwari patta, the inam extinguishes. The grantee becomes absolute
owner. He is liable only to pay ryotwari assessment to the Government. No F
condition has been fastened therein making the grantee render service to the
respondents. There is presumptive evidence that the legislature is aware of
the: pre-existing law and it intended to bring about alteration in the pre-
existing liability by putting an end thereto and created new rights under the
AcL The Act intended to extinguish the pre-existing vestige of obligation to G
render service running with the land and relieved the holder of the land from
the said obligation. The vested rights, therefore, cannot be divested except in
accordance with the procedure established by law. Section 15 gives over-
riding effect over the Act though it is inconsistent with any other law or any
instrument having force of law by virtue of any such law. H

•
450 SUPR::ME COURT REPORTS [ 1996] I S.C.R.
\
A The question that arises is : whether the legislature, by a side-wind,
without suitably amending the Inams Abolition Act, as interpreted by the
High Court, or repealing it, could directly nullify the said law laid by the
Court and divest, under Section 76 of the Act,-the vested right and declare
that the land was not covered by said ryotwari patta or shall not be
B transferred or shall be deemed never to have been transferred thereunder and
would treat such persons as encroachers? It is seen that the Inam Abolition
Act is a complete code in itself and gives over-riding effect to any law
inconsistent t.herewith creating vested rights over the former inam lands
which ceased to exist on the grant of ryotwari patta. Being a ryotwari land
held by a tenant, an archaka, a service holder or other employee after grant
c of ryotwari patta, holds the land with absolute right to the extent of 1/3 land
as an independent and absolute owner. The pre-existing relationship, in
relation to the land stood terminated and direct relationship with the
Government was created by i1nposition of ryotwari assessmenL Section 12
fastens the liability to pay ryotwari settlement to the Government. Thereby,
D the whole of inam service existing prior to the grant of ryotwari patta ceased
to have any statutory effect. The liability to render service ceased. Thereby
independently, the service holder became entitled to hold the land in his own
right as a holder of land held by hirn with absolute right, title and interest in
the said land and to enjoy the property with heritable rights or right to
E alienation, gift over, bequeath etc. The Act did not make any direct attempt
to repeal the provisions of the lnams Abolition Act. It did not directly attempt
to extinguish the right, title and interest of ryotwari settlement created under
the Inams Abolition Act nor acquired the same under the Act.

The question, in that scenario, which emerges is whether Section 76 is
F
a valid piece of legislation, indirectly repealing the loams Abolition Act or
the judgments of that High Court referred to hereinbefore. It is settled law
that repeal of an Act divesting vested rights is always disfavoured. Presump-
tion is against repeal by implication and the reason is based on the theory that
the legislature, while enacting a law, has complete knowledge of the pre-
G existing law on the same subject matter. In the "Principles of Statutory
Interpretation" by Justice G.P. Singh, (5th Edition) 1992 at pages 186-87
under the caption "Reference to other statutes" in Chapter IV (External Aids
lo Construction) it has been stated that "a legislation proceeding upon an
erroneous assumption of the existing law without directly amending or
H declaring the law is ineffective to change the law. "The beliefs or assump-

•
)
PV.M.R.D. IYENGAR v. GOVT OF A.P. [RAMASWAMY, J.] 451
tions of those who frame Acts of Parliament cannot make the law" and a A
mere erroneous assumption exhibited in a statute as to the state of the
~1 existing law is ineffective to express an "intention" to change the law; if, by
such a statute, the idea is to change the l~w, it will be said that "the
legislature has plainly missed fired". The "legislation founded on a mistaken
or erroneous assumption has not the effect of making that the law which the B
legislature had erroneously assumed to be so." The court will disregard such
a belief or assumption and also the provjsion inserted in that belief or
assumption. A later statute, therefore, is normally not used as an aid to
" construction of an earlier one."
.;
In Sarwan Singh & Anr. v. Kasturi Lal, [1977] 2 SCR 421, the facts C
were that Section 19 of the Slum Area Improvement and Clearance Act,
1956, with a non obstante clause, provided overriding effect to any other law
being enforced in slum area. No person except with the previous permission
in writing of the competent authority could institute any suit or proceeding
for obtaining any decree or order for eviction of a tenant from any building D
in slum area. The procedure in that behalf had been provided. Chapter lllA
of the Delhi Rent (Control) Act was enacted. Section 14A, 25A, 25B and
25C were brought on statute. Section 14A with non obstante clause,
empowered the landlord to require his own building for residential accommo-
dation when he was asked to vacate the land allotted by the Government. The E
question arose : which of the two provisions occupying the same field, would
prevail? At page 433, this Court held that speaking generally, the object and
purpose of a legislation assume greater relevance, if the language of the law
is obscure for resolving inter se conflicts. Another test may also be applied,
though the persuasive force of such a test is one of the factors which
F
combine to give a similar meaning to the language of the law. The test is that
the latter enactment must prevail over the earlier one in the case of conflict.
Accordingly, it was held that when two or more laws operate on the same
field and each contains a non obstante clause, case of conflicts has to be
decided with reference to the object and purpose of the law under considera-
tion. In that case, the landlord who was in government house was directed to G
vacate the house. Special procedure in Chapter IIIA was provided to mitigate
the hardship to the landlord and to have eviction of his tenant from a
premises situated in slum area for his personal occupation. To give effect to
the legislative object, in view of the conflict by employing double non-
obstante clause in the respective provisions occupying the same field, this H
452 SUPREME COURT REPORTS [1996] I S.C.R.
A Court had given effect to legislative intention by harmonious interpretation of
both provisions by reconciling the two inconsistent provisions and held that
the landlord was entitled to evict his tenant under Section 14A, despite the
·'
special protection given under the Slum Improvement Act.

The ratio has no application to the facts situation. The provisions in the
B Delhi Rent Act are procedural formal for evicting a tenant from a building
situated in a slum area covered by the Rent Act. But the Inams Abolition Act
occupies an entirely different field and has given absolute right, title and
interest over the land held by an archaka, service holder or employee etc.
Section 76 of the Act by indirect process, without directing repeal of the
C Inams Abolition Act or divesting the title, which became final after conjunc-
tion into t)'Otwari land, attempted to defeat them

In The Income-tax Officer, Kanpur & Ors. v. Mani Ram & Ors., AIR
1969 SC 543 at 548 para 8, this Court had held that, generally speaking, a
subsequent Act of Parliament affords no useful guide to the meaning of
D
another Act which ca1ne into existence before the later one was framed.
Under special circu1nstances, the law does, however, admit of a subsequent
Act to be resorted to for this purpose but the conditions under which the later
Act may be resorted for the interpretation of the earlier Act are strict; both
must be laws on the same subject, and the part of the earlier Act which is
E sought to be construed must be ambiguous and capable of different mean-
ings. In Inland Revenue Conunissioners v. Dowdall, O'Mahoney and Co.
Ltd., (1952) AC 40 I, Lord Radcliffe had held that the beliefs or assumptions
of those \Vho fra1ne Acts of Parliament cannot make the Jaw. In Nalif1ikant
Awbeal Mody v. Commisin11er of Income-tax, Bombay, AIR (1967) SC 193
F al 203, this Court further had reiterated that an Act of Parliament does not
alter the Jaw by merely betraying the erroneous opinion of it. In Hariprasad
Shivslw11ker Shukla & Anr. v. A.D. Divelkar & Ors., AIR (1957) SC 121 at
131, a Constitution Bench construing the effect of two enactments and the
ineaning to be assigned to the word 'retrenchment' or a closure of an
G establishment on the point of Parliamentary exposition had held that the
earlier cnactn1enl was preferred to the latter enactment covered under the
Industrial Disputes Act; so, Industrial Disputes (Amendment and Miscellane-
ous Provisions) Act (36 of 1956) was pret"erred to the Industrial Disputes
(Amendment) Act (41 of 1956).

H It would thus be clear and we hold that without amending the law
)
P.VM.R.D. IYENGAR"· GOVT. OF A.P. [RAMASWAMY, l.] 453

under Inan1 abolition Acl and \.Vithout properly removing the foundation of A
the judgments rendered by lhe High Court, the legislature sought to destroy
the effect of the law in Ina111 Abolition Act on erroneous belief or assumption
that it did not bind the religion or charitable institutions or endowment or that
the holder of land did not acquire Litle or no palta was granted to him and
the land was still with the institution and treated the occupant as encroacher. B
The legislation founded on such an erroneous assumption does not have the
effect of depriving the holder of the land of their vested rights acquired under
the lnams Abolition Act. The legislature has plainly misfired. Accordingly,
we hold that Section 76 and explanation II to Section 2(22) of the Act to
that extent are invalid and unconstitutional.
c
The writ petition is accordingly allowed, but, without costs.

T.N.A. Petition allowed.

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