SANJAY KUMAR AND ANR.versusSTATE OF U.P. AND ORS.

A                         SANJAY KUMAR AND ANR.
                                     v.
                           STATE OF U.P. AND ORS.

                                 AUGUST 31, 1995
B
                 [M.M. PUNCHHI AND FAIZAN UDDIN, JJ.)

          U.P. Imposition of Ceiling on Land Holdings Act, 1961, a~ amended
    by U.P. Imposition of Ceiling on Land Holdings (Amendment) Act, 1972:

C         Sections 5(1), 5(6) and 5(8)-Agdcultural land-Ceiling are~Deter-
    mination of-Involuntary transfer-Court sale-Effected after 24.1.1971 in
    execution of compromise decree-Ceiling authodties ign01ing transfer as
    made neither in good faith nor for adequate consideration-Held, sales,
    voluntary or involuntary, are required to pass the test of being bona fide sales
D   and for adequate consideration so as to be excluded from being computed in
    the swplus area of tenure holde,.._To be treated as void when_ taking place
    dudng continuance of surplus area proceedings.

           The original tenure holder was served with a notice under section
    10(2) of the U.P. Imposition of Ceiling on Land holdings Act, 1960 on
E   10.10.1974. His objections were rejected. He made an· option to effect a
    change in the lands proposed to be declared as surplus. During the
    pendency of the proceedings the original tenure holder died and the name
    of his heir was substituted in the Revenue records in 1984. The prescribed .
    authority, by his order dated 22.7.1984 declared 82.49 acres of land of the
F   original tenure holder as surplus. Meanwhile, father of the appellants, in
    certain money suits obtained compromise decrees against the original
    tenure holder. In order to recover the decretal amount,·75.51 acres of land
    of the judgment debtor, the original tenure holder, was put to auction on
    17.10.1975. In the meantime, the decree holder also died and his heirs, the
    appellants, purchased the said land in auction sale for Rs. 10,000. There-
G   after the appellants moved the prescribed authority for setting aside the
    determination of the surplus area of the decree holder, the original tenure
    holder. The prescribed authority ignored the transfer. The appeal was also
    dismissed. The appellants filed a writ petition before the High Court on
    the ground that they were bona fide purchasers under a court sale which
H   was an involuntary transfer and as such they were entitled to the protec-
                                          186
                          SANJAYKR.v. STATE                              187

tion of law. The State resisted the claim on the ground that the auction        A
sale having been made during the pendency of the ceiling proceedings
between 10.1.974 and 22.8.1984, were null and void, and could neither be
termed as bonafide transaction nor was it for adec1uate consideration. The
High Court, accepting the stand of the State, dismissed the writ petition.

        Dismissing the appeal, this Court                                       B

      HELD : 1. The auction-sale having taken place at a time when the
proceedings under the U.P. Imposition of Ceiling on Land Holdings Act,
1960 were pending, the transfer was void. The auction-sale cannot be
validated merely because it was conducted on orders of the Civil Court
especially when such sale if allowed to stand, would tend to defeat the
                                                                                c
provisions of the Ceiling Act. The Act would stand as a clear bar to the
claim of decree holder in respect of the lands which were involved in the
surplus area proceedings. [194-B-C]

      2.1. The sales, voluntary or involuntary, are required to pass the test   D
of being bonafide sales and for adequate consideration so as to be excluded
from being computed in the surplus area of the tenure holder and are to
be treated as void when taking place during continuance of surplus area
proceedings. [194-D-E]

        2.2. In view of section 5(1) of the Act, the ceiling area is to be E
computed as the holdings stood on 24.1.1971. All transfers effected there-
after, would have to be ignored and not taken into account except as
provided in the proviso and the Explanations. A transfer proved to the
satisfaction of the prescribed authority to be in good faith and for adequate
consideration and under an irrevocable instrument not being a benami F
transaction or for immediate or deferred benefit of the tenure-holder or
other members of his family is excepted from the purview under sub-sec-
tion (6) of section 5. Then again, as per the non-obstante clause of sub-sec-
tion (8) of section 5, no tenure holder shall transfer any land held by him
during the continuance of proceedings for detennination of surplus land in G
-  l<ttion to such tenure-holder and every transfer made in contravention
    0



of this sub-section shall be void. This being the scheme of the Act, principly
it would not make any difference whether the sale is voluntary or involun-
tary, for in either way the surplus area would get diminished and suscep-
tible to the adoption of devices so as to diminish the extent of surplus area,
expected to be reaped in the measure of agrarian reforms. [193-B-F]            H
    188                   SUPREME COURT REPORTS [1995] SUPP. 3 S.C.R.

A          2.3. The High Court, in the circumstances, was right and quite just
    in holding that in the absence of full particulars regarding the auction-
    sale, it was difficult to !tSSume that the auction sale happened to be bona
    fide and for adequate consideration or otherwise valid. The appellants
    themselves have produced the copies of the judgments/decrees of the Civil
    Court. They are, for paltry sums of money and basically on compromise
B   or consent. Those amounts were not such which judgment-debtor could
    not pay off and had to let auction take place of such a large chunk of land
    of 75.51 acres to be purchased by the decree-holders themselves for paltry
    sum of Rs.10,000 only, even if the tenure holder were to be believed that
    the area was unirrigated, though not holding so. [193-G-H; 194-A]
c
          3. The Ceiling Act came as a measure to further promote agrarian
    reforms and to curtail the size of the land holdings to 7.5 hectares per
    family. The provisions of Ceiling Act enjoy the protection of 9th Schedule
    of the Constitution. In reaching the provisions thereof-one has to attune
    oneself with the purposes of the Act. As it is, section 5 imposes a ceiling
D   on land holdings and has taken care to plug all escape routes by which the
    measure of the holding could, by patent or latent devices, be diminished.
    The Courts and especially officers in the heirarchy, have to have the
    necessary insight to see that the purposes of the ceiling Act are not
    frustrated. The view of the courts would necessarily have to bear that slant
E   in giving full effect to the provisions of the Act. [192-G-H; 193-A]

            CIVIL APPELLATE JURISDICTION : Civil Appeal No. 112 of
    1995.

         From the Judgment and Order dated 17.4.87 of the Allahabad High
F   Court in C.M.W.P. No. 16418 of 1985.

            Satish Chandra and N.K. Aggarwala for the Appellants.

            K.S. Chauhan and Ashok K. Srivastava for the Respondents.

G           The following Order of the Court was delivered :

          The question that arises for determination in this appeal is whether
    i11voluntary transfers such as a court sale, is a transaction valid under the
    provisions of sub-sections 6 and 8 of Section 5 of the Uttar Pradesh
    Imposition of Ceiling on Land Holdings Act, 1960 (for short 'the Ceiling
H   Act'), and to be reckoned in decreasing the surplus area?
                                SANJAY KR. v. STATE                           189

              One Jagdish Chander was a tenure-holder in village Bijeser Bijoria, A
      Di.slt. Shahjahanpur in the State of U.P. He had a large holding being over
      100 acres of land. On 10-1-1974, he was served with a notice containing the
      necessary statement of his holding under the provisions of Section 10(2) of
      the Ceiling Act. A proposal was appended therewith as to which of his area
      was proposed to be declared 'surplus'. The tenure-holder thereafter filed B
      certain objections. His objections mainly were that his entire holding was -
      unirrigated and had wrongly been termed as 'irrigated' and for this twist,
      he gave various reasons. He also raised the plea that he had one major
      unmarried daughter and therefore was entitled to get two additional hec-
      tares of land for her. He did not mentioned about his son. Perhaps he was
      a minor on the crucial date. Lastly, he made an option to effect a change C
      in the lands proposed to be declared surplus. These facts are crystal clear
      from the narration given in the order of the Additional District and
      Sessions Judge, Shahjahanpur, appended as Annexure 'A' to the special
      leave petition.
                                                                                     D
            During the pend ency of the proceedings, J agdish Chander died and
      his heir Ajai Verma was substituted in the year 1984. On 22-8- 1984, 82.49
      acres of land of the tenure-holder was declared 'surplus'. The matter rested
      there so far as Jagdish Chander and his family members were concerned.
      The matter for them became closed.
                                                                                     E
             The appellants before us were the writ petitioners in the High Court.
      They are sons of one Dharmendra Nath. This Dharmendra Nath, apparent-
      ly, had certain money claims on the basis of pronotes against the aforesaid
      Jagdish Chander. He filed four suits in the civil court for the recovery
      thereof. The sums involved were small. The suit were decreed basically on F
      consent or compromise. All of them were instituted and decided in the
      year 1972. Purporting to recover those decretal amounts, auction of land
...    on the judgment-debtor was suggested in execution and the executing court
       in order to recover the decretal sums, put to auction 75.51 acres of land
      on 17-10-1975 belonging to the Jagdish Chander, permitting the decree- G
      holders, the appellants herein, to purchase the same. The sale was con-
      firmed and sales certificates were issued. It is in these circumstances that
      the appellants moved the Prescribed Authority for setting aside the deter-
      mination of the surplus area of the decree-holder vide order dated 20-8-
      1984. Their objection was dismissed by the Prescribed Authority. Their
      appeal, too, was dismissed by the Additional District Judge on 12-9-1985. H
    190                   SUPREME COURT REPORTS (1995] SUPP. 3 S.C.R.

A   This gave an occasion to them to approach the High Court in proceedings
    under Article 226 of the Constitution. The appellants, however, raised a
    number of pleas to contend that their claim had wrongly been negatived
    being bonafide purchasers of surplus area measuring 75.51 acres by an
    auction sale and, hence they, were entitled to the protection of law. (In
    fact, it was their father who was the auction-purchaser but on his demise
B   they had been projecting his case as his legal representatives).

          The State, on the other hand, questioned the auction sale terming it
    as neither being a bona-fide transaction nor for adequate consideration,
    giving justification to the Ceiling Authorities to ignore the same. It was
C   highlighted that since the proceedings for determination of surplus area
    were pending from 10-10-1974 till 22-8-1984, the auction-sale effected
    within that period had to be treated as 'void' conferring no right on the
    appellants.

          Section 5 of the Ceiling Act, insofar as it is relevant for our purposes,
D provides:
            "5.(1) IMPOSITION OF CEILING - (1) On and from the com-
            mencement of the Uttar Pradesh Imposition of ceiling on Land
            Holdings (Amendment) Act, 1972, no tenure-holder shall be en-
            titled to hold in the aggregate throughout Uttar Pradesh, any land
E
            in excess of the ceiling area applicable to him.

            EXPLANATION I - In determining the ceiling area applicable to
            a tenure-holder, all land held by him in his own right, whether in
            his own name, or ostensibly in the name of any other person, shall
F           be taken into account.

            EXPLANATION II - (If on or before January 24, 1971, any land
            was held by a person who continues to be in its actual cultivatory
            possession and the name of any other person is entered in the
            annual register after the said date) either in addition to or to the
G           exclusion of the former and whether on the basis of a deed of
            transfer or licence or on the basis of a decree, it shall be presumed,
            unless the contrary is proved to the satisfaction of the prescribed
            authority, that the first mentioned person continues to hold the
            land and that it is so held by him ostensibly in the name of the
H           second mentioned person.)
                 SANJAYKR.v. STATE                              191

(2) xxxxxxxx                                                           A
(3) xxxxxxxx

( 4) xxxxxxxx

(5) xxxxxxxx                                                           B
(6) In determining the ceiling area applicable to a tenure-holder,
any transfer of land made after the twenty-fourth day of January ,
1971 which but for the transfer would have been declared surplus
land under this Act, shall be ignored and not taken into account :
                                                                       c
   PROVIDED that nothing in this sub-section shall apply to -

(a) a transfer in favour of any person (including Government)
referred to in sub-section (2) ;

(b) a transfer proved to the satisfaction of the prescribed authority D
to be in good faith and for adequate consideration and under an
irrevocable instrument not being a benami transaction or for im-
mediate or deferred benefit of the tenure-holder or other members
of his family.

EXPLANATION I - For the purposes of this sub-section, the              E
expression transfer- of land made after the twenty-fourth day of
January, 1971 includes -

(a) a declaration of a person as a co-tenure-holder made after
twenty-fourth day of January, 1971 in a suit or proceeding irrespec-
                                                                       F
tive of whether such suit or proceeding was pending on or was
instituted after the twenty-fourth day of January, 1971;

(b) any admission, acknowledgment, relinquishment or declaration
in favour of a person to the like effect, made in any other deed or
instrument or in any other manner.                                  G
EXPLANATION II-The burden of proving that a case falls within
clause (b) of the proviso shall rest with the party claiming its
benefit.

(7) xxxxxxx                                                            H
    192                   SUPREME COURT REPORTS [1995) SUPP. 3 S.C.R.

A            (8) Notwithstanding anything contained in sub-sections (6) and (7),
             no tenure-holder shall. transfer any land held by him during the
             continuance of proceedings for determination of surplus land in
             relation to such tenure-holder and every transfer made in con-
             travention of this sub-section shall be void.

B
             EXPLANATION - For the purposes of this sub-section, proceed-
             ings for determination of surplus land shall be deemed to have
             commenced on the date of publication of notice under sub- section
             (2) of Section 9 and shall be deemed to have concluded on the
             date when an order in relation to such tenure-holder is passed
c            under sub-section (1) of Section 11 or under sub-section (1) of
             Section 12, or as the case may be, under Section 13.

          The High Court in its judgment under appeal, on applying the
    abovesaid provisions, arrived at a decision that the· appellants had no case
D since they had purchased the area in an auction-sale in the year 1975, sale
    of which was confirmed in 1977, after the date of the commencement of
    the Act, i.e., 8-6-1973, when the disputed area belonged to Jagdish
    Chander, the tenure· holder. The High Court ~ewed that the Ceiling
    Authorities were fully justified in ignoring the auction sale and treating the
    auctioned area as holding of the tenure-holder while determining his
E · surplus area. Notice was found to have been given to the son of the
    tenure-holder, even though residing in Sweden at that time. The High
    Court also opined the sale would be 'void' in the facts and circumstances,
    even though involuntary and being an auction-sale. Besides, the High Court
    was also of the view that the appellants had failed to produce relevant
F documents to demonstrate that valid decrees had been passed in good faith
    against the tenure-holder and that the auction-sale was held in good faith
    and was valid and legal, removing the suspicion of a large area of 75.51
    acres being sold for just a sum of Rs. 10,000 only. The transaction, as such,
    was viewed by the High Court as not bona fide or for adequate considera-
    tion.
G
           The Ceiling Act came as a measure to further promote agrarian
    reforms and to curtail the size of the land holdings to• 7.5 hectares per
    family. The provisions of the ceiling Act enjoy the protection of the 9th
    Schedule to the Constitution. In reading the provisions thereof one has to
H   attune oneself with the purposes of the Act. As it is, Section 5 imposes a
                         SAN.JAY KR. v. STATE                           193

ceiling on land holdings and has taken care to plug all escape routes by A
which the measure of the holding could, by patent or latent devices, be
diminished. The courts, and especially the officers in the hierarchy, have
to have the necessary insight to see that the purposes of the Ceiling Act
are not frustrated. The view of the courts would necessarily have to bear
that slant in giving full effect to the provisions of the Act. As reproduced
                                                                               B
above, Section 5 lays down the method of determination of the ceiling area.
It is to be computed as the holding stood on 24.1.71. All transfers effected
thereafter, would have .to be ignored & not taken into account. Exceptions
thereto are provided in the proviso and the explanations. A transfer proved
to the satisfaction of the Prescribed Authority to be in good faith and for
adequate consideration and under an irrevocable instrument not being a        c
benami transaction or for immediate or deferred benefit of the tenure-
holder or other members of his family is excepted from the purview under
sub-section 6. Then again sub-section 8 which starts with a non-obstante
clause, inter alia, provides that "Notwithstanding anything contained in
sub-section (6), no tenure-holder shall transfer any land held by him during D
the continuance of proceedings for detemiination of swplus land in relation
to such tenure-holder and eve1y transfer made in contravention of this sub
section shall be void". The Explanation thereto gives the duration during
which proceedings can be said to have continued for determination of
surplus area. Undeniably, had the transfer of 75.51 acres been made by the
tenure-holder himself, sub-sections (1), (6) & (8) of Section 5 would E
warrant ignoring thereof and not being taken into account. Further, if that
transfer was within the time during the continuance of the proceedings for
determination of surplus land then it would be void altogether. This being
the scheme of the Act, principly it would not make any difference whether
the sale is voluntary or involuntary, for in either way the surplus area would F
get diminished and susceptible to the adoption of devices so as to diminish
the extent of surplus area, expected to be reaped in the measure of agrarian
reforms. The High Court was, thus, not wrong in trying to discover and
then finally determine that in the absence of full particulars regarding the
auction- sale. it was difficult to hold that the auction-sale happened to be
bona fide and for adequate consideration or otherwise valid. The appel- G
lants themselves have produced before us the copies of the judg-
ments/decrees of the Civil Court. They are, as said before, for paltry sums
of money & basically on compromise or consent. Significantly, they date
back to the year 1972 when agrarian reforms throughout India w.e.f. 24.1.71
                                                                              H
    194                  SUPREME COURT REPORTS [1995] SUPP. 3 S.C.R.

A   was a talk of the times, in media, Press and policy statement of the
    government of the time. Those amounts were not such which the judgment-
    debtor could not pay off and had to let auction take place of such a large
    chunk of land of 75.51 acres to be. purchased by the decree-holders
    themselves for a paltry sum .of Rs. 10,000 only, even if the tenure-holder
    were to be believed that the area was unirrigated, though not holding so.
B   That the auction-sale took place at a time when the surplus area proceed-
    ings were pending, further goes to show that the transfer was void. The
    auction-sale cannot be validated merely because it was conducted under
    Orders of the Civil Court especially when such sale if allowed to stand
    would tend to defeat the provisions of the Ceiling Act. That Act would
c   stand as a clear bar to the claim of the decree-holder in respect of lands
    which were involved in the surplus area proceedings.

           The view of the High Court thus, as it appears to us, was in con-
    sonance with the letter and spirit of the Act and quite just in the cir-
    cumstances. We agree with that view. We, thus, conclude to say that the
D   sales, voluntary or involuntary, are required to pass the test of being bona
    fide sales and for adequate consideration so as to be excluded from being
    computed in the surplus area of the tenure-holder and are to be treated
    as void when taking place during continuance of surplus area proceedings.

           For these reasons, we dismiss this appeal but without any order as
E to costs.

    R.P.                                                     Appeal dismissed.