State of Madhya Pradesh Vs. Yakinuddin
 INSC 209 (4 May 1962)
04/05/1962 SINHA, BHUVNESHWAR P.(CJ) SINHA,
BHUVNESHWAR P.(CJ) GAJENDRAGADKAR, P.B.
AYYANGAR, N. RAJAGOPALA AIYYAR, T.L.
CITATION: 1962 AIR 1916 1963 SCR (3) 13
CITATOR INFO :
F 1968 SC1218 (4) R 1970 SC 706 (8,9) F 1985
Abolition of Proprietary Rights-Consequence
of vesting of such rights in the State- Transfer of interest by Proprietor-If
enforceable against the State--Madhya Pradesh Abolition of Proprietory Rights
(Estates, Mahals, Alienated Lands) Act, 1950 (M.P.1 of 1951), ss. 3, 4, 5, 6.
Section 4 (1) (a) of the Madhya Pradesh
Abolition of Propeietary Right's (Estates, Mahals Alienated Lands) Act, 1950,
provides that when the notification under, s. 3 in, respect of any areas. has
been, published in the Gazette, then,, notwithstanding anything contained in
any contract, grant or document or in any other law for the time being in
force, and save as otherwise, provided in this Act, the consequences as
hereinafter set forth shall.. ensure, namely, (a) all rights, title and
interest vesting in the proprietor or any person having interest in such
proprietary right through the proprietor in such area including land (cultivable
or barren), grass land, scrubjungle, forest, trees. . . shall cease and be
vested in the State for the purposes of the State free of all encumbrances The
respondents, by grants from and, agreements with the proprietors, acquired them
right to propagate lac, collect tendu leaves and gather fruits and flowers of
Mahua leaves in; certain estates. On the coming into effect of the Act and the
issue- of necessary notifications under s. 8, the State took possession of the
estates and refused to recognise the rights claimed by the respondents. The
High Court relying on the decision of this Court in Chhotabhai Jethabhai Patel
and Co. v. State of Madhya Pradesh, (1953 S.C.R. 476, held the rights, claimed
by the respondents had not been affected by the Act. The State appealed. The
case of the respondents was that their rights were, saved by s. 6(1) of the Act
which was as follows :- "6(1) Except as provided in sub-section (2), the
transfer of any right in the property which is liable to vest in the State
under this Act made by the- proprietor at any time after the 16th Match 1950
shall, as from the date of vesting be void." 14 Held, that whatever rights
the respondents had acquired from the proprietors ceased to have effect by the
operation of s. 4(1)(a) of the Act on the vesting of the estates in the State.
It was not correct to say that s. 6(1) of the Act saved those rights. That
Section referred to those transaction of transfer of right which was liable to
vest in the State and rendered them void. It did not lay down that a transfer
made before March 16, 1950, was necessarily binding on the State.
The Act had for its object the acquisition by
the State of all interests in the estate that the proprietor or an inter-
mediary had in it except those of the actual tillers of the soil. Clauses (a)
to (h) of s. 5 of the Act showed what interests were saved by the Act and the
interests sought to be enforced by the respondent, were none of these. The
rights claimed by them, therefore, could not be enforced against the State.
Chhotabhai Jethabhai Patel and Co. v. State
of Madhya Pradesh,  S.C.R. 476, overruled.
Shrimati Shantabai v. State of Bombay, 
S.C.R. 265 and Mahadeo v. State of Bombay,  Supp. 2 S.C.R. 239, applied.
CIVIL APPELLATE JURISDICTION :Civil Appeals
Nos. 229 & 281 to 283/1961.
WITH C. A. Nos. 281 to 283 of 1961.
Appeals from the judgment and orders dated
February 20, 1958, of the Madhya Pradesh High Court in Miscellaneous Petitions
Nos. 500 and 524 of 1954 and 419 of 1955.
I.N. Shroff, for the appellants.
S. N. Kherdekar, B. N. Srivastave, N. K.
Kherdekar and Ganpat Rai, for the respondent (in C. A. No. 229/61).
G. C. Mathur, for the respondent (in C. A.
H.N. Sanyal, Additional Solicitor General of
India and G. C. Mathur, for the respondent 'in C.A. No. 282/61).
W. S. Barlingay and A. G. Batnaparkhi, for
the respondent (in C. A. No. 283/61).
15 1962. May 4. The Judgment of the Court was
delivered by SINHA, C. J.-In these appeals the common question of law that
arises for determination is whether the respective grants made by the outgoing
proprietors in favour of the respondents convey any rights to them. which could
be enforced against the appellant, the State of Madhya Pradesh, after the
coming into effect' of the Madhya Pradesh Abolition of Proprietary Rights
(Estates, Mahals, Alienated Lands) Act, 1950 (Madhya Pradesh Act of 1951)-which
will be referred to hereinafter is the Act.
It is not necessary to state the facts of
each case in any detail because they are not disputed, and nothing turns on the
difference in facts. In Civil Appeal No. 229 of 1961, the respondent obtained,
by virtue of registered documents, the grant of 24 villages in Balaghat and
Mandla Districts, for propagating lac, the lease to expire on July 31, 1955.
In Civil Appeal No. 281 of 1961, by virtue of
two unregistered agreements, the respondent obtained the right to collect tendu
leaves in 37 villages upto July 31, 1963.
In Civil Appeal No. 282 of 1961, the
respondent obtained similar rights from the proprietor by virtue of registered
agreements, extending up to the end of the year 1962. In Civil Appeal No. 283
of 1961, the respondent obtained the right to collect fruits and flower of
Mahua trees from the proprietor, extending down to the year 1969, by virtue of
three registered leases.
On the coming into effect of the Act and the
issue of the necessary notifications under s. 3 of the Act, the appellant, the
State of Madhya Pradesh, took possession of all the villages comprised in the
respective estates of the proprietors, who were the grantors of the several
interest indicated above 16 in, favour of the respondents The State refused to
recognise the rights claimed by the respondents by virtue of the transactions
aforesaid in their favour.
In each case, the High Court relying upon the
decision of this Court in Chhotabhai Jethabai, Patel and Co. v. The State, of
Madhya Pradesh (1) granted the relief claimed by the respondents, and hold that
the several interests claimed by the respondents had not been affected by the
coming into force of the Act. The High Court did not accept the contention
raised-on behalf of the State that as a result of the coming into operation of
the Act all these interests which were the subject matter of dispute in all
these cases had been extinguished, in view of the provisions of s. 4 (1) (a) of
the Act Soon after the decision aforesaid of this Court, the matter was
re-examined by this Court in the case of Shrimati Shantabai v. State, of Bombay
(2), and in the case of Mahadeo v. The, State of Bombay (3).
The earliest decision of this Court with
reference to the Act is a decision of the Division Bench of three. Judge in
Chhotabhai Jethabai Patel and Co. v. The State of Madhya Pradesh (1). In that
case, which, was a petition under Art.
32 of the Constitution, the petitioners had
entered into various contracts and agreements with the proprietors of the
estates, before the dates on whit the estates vested in the State, under the
Act, under which they were entitled to pluck, collect and carry away tendu
leaves,. and to culti- vate, culture and acquire lac, as also to out and carry
away teak, and timber. The petitioners had complained to this Court that the
State of Madhya Pradesh had been interfering with their rights thus (1) (1953)
S.C.R. 476. (2) (1959) S.C.R. 265.
(3) (1959) Supp. 2 S.C.R. 339.
17 acquired from' the outgoing proprietors.
This Court held, on a construction of the contracts, that the grants in essence
and effect were licences to the petitioners who were neither proprietors, nor
persons having any interests in the proprietary rights through the proprietors,
nor were their interests 'encumbrances' within the meaning of that expression
in s. 3 (1) of the Act. In that view of the matter, the Court granted the writs
in favour of the petitioners. Naturally, the High Court granted appropriate
reliefs to the respondents in this batch of cases, relying upon this decision
of this Court.
In the case of Shrimati Shantabai v. State of
Bombay (1) the same question came up to be re-examined by a Constitution Bench
of this Court. The petitioner in that ease had obtained from the proprietor the
right to take and appropriate all kinds of wood from certain forests in his
estate, by an unregistered document. On the coming into effect of the Act, the
State authorities interfered with the petitioner's rights under the grant from
The petitioner moved this Court under Art. 32
of the Constitution, complaining of interference by the State with those
rights. This Court held that if the grant purported to transfer any proprietary
interest in land, it would be ineffective because it was not evidenced by a
registered document, and that under is. 3 of the Act all proprietary interest
vested in the State. If it was a grant of profits a prendre it would partake of
the nature of immovable pro- perty and would not be effective without a
registered document evidencing the grant. If on the other hand it was a more
contract creating personal rights, the petitioner could-not complain of any act
on behalf of the State officials because (1) (1959) S.C.R. 265.
18 the State had not taken possession of the
contract, which remained the petitioner's property. The State not being a party
to that contract, would not be bound by it, and that, alternatively, if the
State were bound by the terms of the contract, the petitioner's remedy lay by
way of suit for the enforcement of the contract. Hence, it was held that there
was no question of the infringement of any fundamental right in that case.
The provisions of the Act also came in for
consideration in the case of Mahadeo v. The State of Bombay (1). In that case,
the petitioners had obtained from the outgoing proprietors the right to collect
tendu leaves and other forest produce in villages which formed part of the
proprietors' estates, before the coming into effect of the Act. Some of the
agreements were registered whereas others were not. The State did not respect
those grants and put- those rights to auction, after having taken possession of
those estates, when they had vested in the State under s. 3 of the Act. The
petitioners then moved this Court under Art. 32 of the Constitution complaining
of the infringement of their rights to property. It was held by this Court that
the agreements required registration, and in the absence of registered
documents could not confer any rights, which were some interest in land. It was
also held that rights conveyed to the petitioners under the agreements were
proprietary rights which, under the provisions of ss. 3 and 4 of the Act became
vested in the State. Alternatively, if the interests created by the agreements
were not in respect of proprietary rights, it was held that in those interest
the State was not interested, as the State was not bound by the agreements entered
into by the outgoing proprietors.
It would thus appear that in view of this two
later decisions of this Court, the High Court was in error in granting any
relief to the respondents. But (1) (1959) Supp. 2 S.C.R. 339.
19 it has been contended on behalf of the
respondents that certain aspects of the controversy had not been brought to the
notice of the Court on the previous occasion, and that the respondents were
entitled to the benefit of s. 6 of the Act. It was contended that the
respondents' right were not in the nature of mere licences, but were in the
nature of profits a prendre, which were saved to them in view of the provisions
of s. 6.
In our opinion, there is no substance in the
contention raised on behalf of the respondent. Under s.. 3 of the Act, from the
date of the notification by the State, all proprietary rights in an estate
vesting in a proprietor of such an estate or in a person having interest in
such proprietary rights through the proprietor, shall vest in the State for the
purposes of the State, free from all encumbrances. The consequences of such a
vesting are laid down in s. 4, which runs into several clauses and sub-
sections. section 4(1)(a) is the relevant provision of the Act which determines
this controversy entirely against the respondents. It provides that "when
the notification under s.3 in respect of any area has been published in the
Gazette, then, notwithstanding anything contained in any contract, grant or
document or in any other law for the time being in force, and save as otherwise
provided in this Act, the consequences as hereinafter set forth shall, ensue,
namely, (a) all rights, title and interest vesting in the proprietor or any
person having interest in such proprietary right through the proprietor in such
area including land (cultivable or barren), grass land, scrubjungle, forest,
trees ... shall cease and be vested in the State for the purposes of the State
free of all encumbrances..."(We have omitted the words which are not
necessary for the purposes of the present appeals). It is clear on a bare
reading of the provisions of cl. (a) of s. 4 (1) that whatever rights the
proprietor, or a person claiming interest through 20 him, had in the trees,
scrubjungle, forest, etc., ceased on the vesting of the estate in the State.
But it was contended on behalf of the
respondents that s. 6(1) saves their rights from the operation of s. 4(1)(a),
because, it is argued, s. 4(1)(a) is subject to the provisions of s. 6(1).
Section 6(1) runs as follows "6(1) Except as provided in sub-section (2),
the transfer of any right in the property which is liable to vest in the State
under this Act made by the proprietor at any time after the 16th March 1950
shall, as from the date of vesting, be void." In our opinion, there is no
substance in this contention.
Section 6 refers to those transactions of
transfer of any right which is liable to vest in the State as being void.
It does not lay down that a transfer made
before March 16, 1950, shall be binding upon the State. The transfers which
have been saved by s. 6(1) from being void may be recognised by the State for
which the transferee may be entitled to claim some compensation in accordance
with the provisions of the Act. But s. 6 does not save' that interest from
being vested in the State as a result of the notification under s. 3, read with
s. 4(1) (a). The' scheme of, the Act is that it provides for the acquisition by
the State of all interests in the estate of the proprietor himself or of an
intermediary, except the tiller of the soil. This it does by vesting all
proprietary rights in the State, of whatever grade, by issuing the notification
under s. 3, vesting it in the State, for the purposes of the State free from
all encumbrances. Section 4 lays down in great detail the rights which become
extinguished on the vesting of the estate as aforesaid. What is saved to the
proprietor or any other person claiming through him is set out in s. 5, cls.
(a) to (h), on such terms and conditions as
may be determined 21 by the State. Hence any person claiming some interest as a
proprietor or as holding through a proprietor in respect of any proprietary
interest in an Al estate has got to bring his interest within s. 5, because on
the date of vesting of the estate, the Deputy Commissioner takes charge of all
lands other than occupied lands and homestead, and of all interests vesting in
the State under s, 3. Upon such taking over of possession, the State becomes
liable to pay the compensation provided for in s. 8 and the succeeding
sections. The respondents have not been able to show that their interest come
under any of the clauses aforesaid of s. 5.
A great deal of argument was advanced on
behalf of the respondents showing the distinction between a bare licence and a
licence coupled with grant or profit a prendre. But, in our opinion, it is not
necessary to discuss those fine distinctions because whatever may have been the
nature of the grant by the outgoing proprietors in favour of the respondents,
those grants had no legal effect as against the State, except in so far as the
State may have recognised them. But the provisions of the Act leave no manner
of doubt that the rights claimed by the respondents could not have been
enforced against the State, if the latter was not prepared to respect those rights
and the rights created by the transactions between the respondents and their
grantors did not come within any of the saving clauses of s. 5.
In view of these considerations, it must be
held that these cases are equally governed by the decisions aforesaid of this
Court, which have overruled the earliest decision in the case of Chhotabhai
Jethabai Patel and Co. v. The State of Madhya Pradesh (1). The appeals are
accordingly allowed with costs throughout, hearing fee one set in this Court.
(1) (1953) S .C.R. 476.