COMMISSIONER OF WEALTH TAX

HINDUSTAN MOTORS LIMITED

March 10, 1976

(H. R. KHANNA AND P. K. GOSWAMI, JJ.]

Wca/tli 1ax Act, 1957 (Act XXV/l of 1957)-Sec. 7(1)(2)-Valuation of depreciable assets-Valuation of assets in balance Sheet, if not proper, whether depreciation 1111der the lncon1e Tax Act cnn be taken into account-Onus to proi'e raluativ11.

The respondent assessee maintains accounts regularly.

In the accounts maintained by him adequate depreciation could not be provided in the balance sheet in regard to the depreciable fixed assets on account of paucity of profits C and hence the depreciation as provided in the balance sheet was very much lower than the depreciation allowable under the Income Tax Act. The assessee claimed before the Wealth Tax Officer that in computing the wealth on the basis of the balance sheet he should reduce the book value of the assets by f the difference between the written down value that \\'Ould be determined for the purpo<; e of Income Tax Act and the actual book figures disclose-cl by the balance sheet.

The \i\l'ealth Tax Oflicer rejected the contention of the assessee and estimated the net value of the assets as shown in the balance sheets for the respective years.

The appellate Assistant Comn1issioner confirmed the orders D of the \\'calth Tax Officer. _ The Appellate Tribunal, however, took a contrary • vie\\' and held that \\'here proper depreciation has not been allowed in the balance sheet it is proper to accept the \Vritten down value of the assets as worked out for the purpose of income tax assessments.

On a reference n1ade to the 1-li.c; h Court, the Hih Court answered the question in favour of the assessee.

Allowing an appeal by certificate under section 29( 1) of the Wealth Tax Act.

1-fELD: Under Section 7(1) of the Wealth Tax Act the value of .any asset is the Innrket value.

Section 7(2) provides that notwithstanding anything in sc('tion 7( 1) where the assessee carries on business for which accounts are n1aint::1ined by him regularly the Wealth Tax Officer may instead of determining separately the value of each asset held by the assessee in such business, determine the net value of the assets of the business as a whole having regard to the balanc(' sheet of such business as on the valuation date and making such adjustn1en!s therein as the circumstances of the case might require. The object. of the \\.'e:ilth Tax officer under section 7 is to arrive at the true value of the assets of the business.

If what is shown in the balance sheet is not the true value of the assets disclosed it is open to the assessee to satisfy the Wealth Tnx Officer by producing relevant materials that the value given of the fixed assets in the balance sheets is not the true value, and, therefore a reduced v, alue of the assets should be taken into account. In case the assessee wants the written do\1/TI value. to be accepted it is open to him to establish, by cceptable reason that the wntten down vlue represents the proper value of the assets at the relevant date.

The onus in that case \\'ould be entirely on the assessee. 1\-ferely a statement. that on ccount of paucity of. profits adequate depreciation oould not b~ provided for in the balance seet 1s not sufficient to discharge the onus \Vh1ch rests upon the assessee.

The 1udgment of the High Court is set aside and the question answered against the assessee. [581E-H 582A-B H

58JA. 584CJ • • •

CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 894-896 of

1971.

From the Judgment and order dated the 29th January 1965 of the Calcutta High Court in Wealth Tax Matter No. 21 /52.

A R. N. Sachthey and S. P. Nayar, for the Appellant.

Leila Seth, Neelima Thakur, Praveen Kumar and B. P. Maheshwari for the Respondent.

The Judgment of the Court was delivered by

GOSWAMI, J.-These appeals are by certificate of the Calcutta High B Court under section 29 (1) of the Wealth-tax Act (briefly the Act).

The assessment years of the respondent company (hereinafter to be described as the assessee) involved in the composite reference to the High Court under section 27(1) of the Act are 1957-58, 1958-59 and 1959-60 for which the correspoRding valuation dates are 31st March, 1957, 31st March, 1958 and 31st March, 1959.

The only common question of law which was referred to the High Court appertaining to all the three assessment years is in the following terms:-

"Whether on the facts and in the circumstances of the case and in view of the provisions of section 7 (2) of the Wealth-tax Act, an adjustment could be made in ascertaining the net value of the depreciable assets of the assessee company by substituting the written down value of the assets computed under the Indian Income-tax Act for the value as shown in the balance

sheet".

The facts appearing from the statement of the case as well as the various orders annexed therewith are briefly as follows :-

The assessee claimed before the Wealth-tax Officer that in computing the wealth on the basis of balance sheet the -Income-tax Officer should reduce the book value of the assets by the difference between the written. down value that would be determined for the purpose of Income-tax Act and the actual book figures disclosed by the balance sheet. The difference between the book value and the written down value amounted to Rs. 95,69,070/-, Rs. 67,78,304/- and Rs. 36,15,678/- respectively for the three years under reference.

The only contention common to the three appeals related to the valuation of the fixed assets of the assessee. The Wealth-tax Officer proceeded under section 7 (2)

(a) and computed the value of the assets at the figures shown in the balance sheets on the material valuaiion dates. The assessee, however, contended that regard being had to the depreciable assets the written down value determined for the purpose of Income-tax assessment should be taken to be the value of the assets for the purpose of inclusion in the net wealth and not the value shown in the respective balance c::: :·:. It was not disputed that adequate depreciation could not be provided for in the balance sheets in regard to the depreciable fixed assets on account of paucity of profits and hence the depreciation as provided for in the books was very much lower than the depreciation allowable under the provisions of the Indian Income-tax Act.

The Wealth-tax Officer rejected the contention of the assessee and estimated the net value of the assets as shown in the balance sheets for the respective years. The Appellate Assistant Commissioner confirmed the orders of the Wealth-tax Officer in the appeals filed by the assessee.

COMMR. WEALTH TAX v. HINDUSTAN MOTORS (Gowami, I.) 581

The Appellate Tribunal, however, took a contrary view and held A that-

"in all such cases where proper depreciation has not been allowed for in the balance sheet for any reason whatsoever, it is proper to accept the written down value of the assets as worked out for the purpose of the Income ta; c assessments."

The Tribunal, therefore, directed the Wealth-tax Officer to adopt the written.down value of the assets as the value thereof for inclusion in the net wealth for all the years under reference.

At the instance of the Commissioner of Wealth-tax the question set out earlier was referred to the High Court under section 27 (1) of the Act. The High Court by the impugned judgment of January 29, 1965, followng another decision delivered on the same day in Commissi, mer of Wealth-tax, Calcutta v. Tungabhwira Industries Limited(')

answered the question in the affirmative and in favour of the assessee.

Hence the present appeals by certificate.

The decision in the Tungabhadra Industries Limited (supra), which was followed by the High Court, was reversed by this Court in the Commissioner of Wealth-tax, West Bengal-II v.

Tungabhadra Industries Ltd.(2) on August 8, 1969. This Court following an earlier decision of this Court in Kesoram Industries and Cotton Mills Ltd. v. Commissioner of Wealth.-tax (Central), Calcutta('), accepted the contention of the Revenue.

Section 7 of the Act at the material time stood as follows :-

" ( 1) The value of any asset, other than cash, for the purposes of this Act, shall be estimated to be the price which in the opinion of the Wealth-tax Officer it would fech if sold in the open market on the valuation date.

(2) Notwithstanding anything contained in sub-section (1)-

(a) where the assessee is carrying on a business for which accounts are maintained by him regularly, F the Wealth-tax Officer may, instead of determining separately the value of each asset held by the assessee in such business, determine the net value of the assets of the business as a whole having regard to the balance-sheet of such business as on the valuation date and making such adjustments therein as the circumstances of the case G may require . ....... "

It is, therefore, clear that when the assessee is carrying on a business for which accounts are maintained by )lim regularly it is open to the Wealthtax Officer to determine the net value of the assets of the business as a whole with reference to the balance sheet of such business as on valuation date and to make such adjustments therein as the circumstances H

(I) 60 l.T.R. 447.

(2) 75 I.T.R. 196.

(3) 59 l.T.R. 767.

of the case may require. The object of the Wealth-tax Officer in determining the value of the assets under sect.ion 7 is to arrive at the true value of the assets of the business.

If what has been shown in the balance sheet is not the true value of the assets disclosed, it is open to the a; scssce to satisfy the Wealth-tax Officer by producing relevant materials that the value given of the fixed assets in the balance sheet is. not the true value and, therefore, a reduced value of the assets should be taken into account. The onus in that case would be i:ntirely upon the assessee to satisfy the Wealth-lax U:1icer that what is shown in the: balance sheet is not the actual and true vaiuc of thC assets on the vaJualion date.

The decision will depend upon the facts and cir- (::umstances disclosed in each case.

This Court in the Tungabhadra Industries case (supra) dealing with the same question observed as follows :-

"It is also open to the assessee to establish by acceptable reasons that the written down value of any particular asset represents the proper value of the asset on the relevant valuation date. In the absence of any material produced by the assessee to demonstrate that the written down value is the real value, the Wealth-tax Officer would be justified in a normal case in taking the value given by the assessee itself to its fixed assets in its balance-sheet for the relevant year as the real value of the assets for the purposes of the Wealth-tax. It is a question of fact in each ease as to whether the depreciation has to be taken into account in ascertaining the true value of the assets. The onus of proof is on the assessee who must produce reliable material to show that the written down value of the assets and-not the balance-sheet value is the true value.

If, therefore, the assessee merely claims that the written down value of the assets should be adopted but fails to produce any material to show that the written down value is the true value, the Wealth-tax Officer is justified in rejecting the claim and adopting the yalues shown by the assessee himself in his balance sheet as the true value of his assets".

We should have thought that the question raised in these appeals is squarely covered by the above decision. Even so, Mrs. Leila Seth submits that in the instant case it is admitted that adequate depreciation could not be provided for in the balance sheet in regard to the depreciable fixed assets on account of paucity of profits and henc, I' the depreciation as provided in the balance sheet was much lower than the depreciation allowable. According to the learned counsel this fact is sufficient to displace the balance sheet as a prima facie eYidenc,, and substitute in its place the written down value and onus shifts on the Revenue to establish that paucity of profits is wrong.

It is true, as descrLl:>ed in the Statement of the case, that it was not disputed that adequate depreciation could not be provided for in the balance sheet on account of paucity of profits. But we are unable to hold that merely a statement to that effect is sufficient to discharge the onus which rests upon the assessee to establish that the value of the

COMMR. WEALTH TAX v. HINDUSTAN MOTORS (Goswami, I.) 5 83

assets shown in the balance sheet is not the real value of the assets as on the valuation date. If the contention of the learned counsel is accepted, it will be tantamount to laying down a rule that in determination ot the ! value of assets the written down value allowable under the Income-tax , Act shall always be the value of the assets. In that event, there would be no necessity for any exercise by the Wealth-tax Officer. That is, however, not the intention of section 7 which clearly shows that the Wealth-tax Officer may make such adjustments in the value of the assets • shown in the balance sheet in accordance with the requirements of the circumstances disclosed by the assessee.

Those circumstances which will be disclosed by the assessee must relate. to the determination of the real value of the assets irrespective of what is shown in the balance sheet if the assessee seeks a lower figure than appearing in the same. Thus onus is not discharged by merely stating that since profits in a given year are less or nil little or no provision was made for depreciation of the assets in the balance sheet. The assessee must also show further to what extent the depreciation has resulted in lowering the value of the r assets compared to that mentioned in the balance sheet and whether the written down value computed under the Indian Income-tax Act in fact represents the lower value. It is open, as observed by this Court in the case of Tungabhadra Industries (supra), to establish after producing relevant material that the value of the fixed assets in the balance sheet ' is artificially inflated. Further in case the assessee wants the written down value to be accepted, it is open to him to establish, as mentioned in that case, by acceptable reason, that the written down value represents ., the proper value of the assets at the relevant date.

The learned counsel also drew our attention to a decision of this Court in the Commissioner of Wealth-tax, West Bengal v. Alun1inium Corp,, ration of India Ltd., (') where at page 172 there is on observation that the value of the assets shown in the balance sheet is not conclusive. The value of the assets shown in the balance sheet is not conclusive in, the sense that it can be demonstrated to be more or less than what is shown therein. That is the core of determination nnder section 7(2) (a) of the Act. The observation of this Court in the above case has to be understood only in that context.

We may in this connection refer to clanse (b) of the proviso to clause (vi) of sub-section (2) of section 10 of the Income-tax Act. 1922 where a provision is made for carrying forward of depreciation allowance for the following year or years where full effect cannot be given to the allo\vance in a particular year owing to \ there being no profits or gains chargeable for that year or owing to the profits and gains chargeable being less than the allowance. If ari assessee chooses to carry forward the depreciation allowance, and shows the value of the assets at a particular figure in the balance sheet, he cannot by merely asserting that there was no profit or very little profit compel the tax authorities to discard the value mentioned in the balance sheet and to accept the written down value. The depreciation must have nexus with real value of the assets itself and the burden is upon the assessee to satisfy the Wealth-tax Officer by producing relevant reliable materials

(l) 35 I.T.R. 167.

for determination of the actual and true value of the as§ets. It may be that in a given year the written down value may be the real value of the assets but that cannot be the inexorable rule in determining the value \ of the assets under section 7 of the Act.

"' Mrs. Seth drew our attention to a decision of the Calcutta High Court in the Commissioner of Wealth-tax (Central) Calcutta v. Mohan Lal Nopany('). This was a case of break up value of certain shares of • a company. There was material in that case to indicate that the balance sheet did not represent the correct value of the shares. The observation in that case must be taken to be confined to its own facts. To the extent observations are made in that contrary to the view we have taken in the matter, we cannot agree with them.

In the result the judgment of the High Conrt is set aside and the question is answered in the negative against the assessee and in favour r of the Revenue. The appeals are allowed with one set of costs. -i,

P.H.P.

Appeals allowed.

(1) 78 I.T.R 435

TAX

HINDUSTAN MOTORS LIMITED

March 10, 1976

H. R. KHANNA

P. K. GOSWAMI, JJ.

Sec. 7(1)(2)

Income Tax Act

section 29( 1)

Section 7(1)

Section 7(2)

section 7

A R. N. Sachthey

S. P. Nayar

Leila Seth

Neelima Thakur

Praveen Kumar

B. P. Maheshwari

GOSWAMI

section 29

Wealth-tax Act

section 27(1)

section 7

Wealth-tax Act

Income-tax Act

Income-tax Act

section 7

Income-tax Act

section 27

January 29, 1965

Tungabhadra Industries Limited

August 8, 1969

Section 7

Tungabhadra Industries

Leila Seth

section 7

Income-tax Act

section 7(2)

section 10

Income-tax Act

section 7

Seth

Calcutta High Court


THAKUR KAMTA PRASAD SINGH (DEAD) BY L.Rs.

THE STATE OF BUIAR

March 10, 1976

[H. R. KHANNA AND P. K. GOSWAMI, JJ.]

Land Acquisition Act, 1894-Sections 23 and 24-Market value-Compensation-Potential possibilities.

The respondents acquired appellant's land under the Land Acquisition Act.

The Land Acquisition Officer awarded compensation at the rate of Rs. 3000/- pcr acre. In a reference under s. 18, the Additional District Judge enhanced the compensation to Rs. 800/- per katha ( 1/32 of an acre). On appeal by the State, the High Court reduced the compensation to Rs. 475/- per katha.

In an appeal by certificate the appellant contended that the High Court was in error in reducin£ the rate of compensation. r Dismi&sing the appeal,

HELD : ( 1) The Additional District Judge \Vrongly excluded certain sale transactions on the ground that the plots in those transactions were at some distance from the acquired land.

The High Court rightly held that the said transactions could not be excluded altogether from consideration. The High Court also took into account 3 other sale transactions which were relied upon by the appellant. The High Court rightly excluded from consideration certain sale deeds executed by the appellant. These transactions related to small plots of land situated on road site and were entered into after the land in dispute had been notified for acquisition.

[586E-H, 587C-D]

(2) .f\.Jarket value under s. 23 means the price that a willing purchaser would pay to a willing seller for property having due regard to its existing condition with all its existing advantages and its potential possibilities when laid out in the n1ost advantageous manner excluding any advantages due to the carrying out of the schen1e for which the property is compulsorily acquired. In considering market value the disinclination of the vendor to part with his land and the urgent necessity of the purchaser to buy should be disregarded. [587E-F]

(3) There is an element of guess work inherent in rnost ca.ses involving determination of the market value of the acquired land. But, this in the very nature of things cannot be helped. The essential thing is to keep in view the relevant factors prescribed by the Act. The finding of the High Court is based upou consideration of the evidence adduced in the case and there are no grounds to interfere with that finding.

[587F-G]

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1436 of 1968.

From the Judgment and Order dated 28-9-67 of the Patna High Court in Appeal from Original Decree No. 129/62

V. S. Desai and B. P. Singh for the Appellant.

R. C. Prasad for the Respondent.

The Judgment of the Court was delivered by

KHANNA, J.-This is an appeal on certificate under article 133(1)

(a) of the Constitution against the judgment of the Patna High Court whereby the appeal of the respondent State against the award of the

5-M608SCl/76

SUPREME COURT REPORTS

[1976] 3 S.C.R.

A learned Additional District Judge Arrah was allowed in part and the amount of compensation payable to the respondent in a land acquisition case was reduced.

The respondent-State acquired 23.70 acres of the appellant's land out of plots Nos. 529 and 1262 appertaining to Khata No. 1 in village Tenduni in Shahbad district for the purpose of constructing an Irrigation Research Station.

Notification under section 4 of the Land Acquisition Act (hereinafter referred to as the Act) was first published on March 8, 1957, but this notification w; i, s cancelled on December 2, 1957. Another notification for the acquisition: of the said land was issued under section 4 -of the Act on January 1, 1959.

The Land Acquisition Officer awarded compensation to the appellant at the rate of Rs. 3,000 per acre, besides certain other amounts with which we are not concerned.

The total compensation awarded by the Land Acquisition Officer came to Rs. 86,070.92. The appellant got a reference made under section 18 of the Act. Learned Additional District Judge Arrah who disposed of the reference held the market value o~ the land to be Rs. 800 per katha. It is stated that there are 32 kathas in an acre. On appeal by the State the High Court assessed the market value of the land' at Rs. 475 per katba.

In appeal before us, learned counsel for the appellant has assailed the judgment of the High Conrt and bas contended that the High Court was in error in reducing the rate at which compensation had been awarded. As against that, learned counsel for the respondent-State has canvassed for the correctness of the view taken by the High Conrt. . l f .

We have given the matter our consideration, and are of the view that there is no merit in this appeal. A number of documents were filed on behalf of the State to show the market value of the land in question. Those documents showed that a plot measuring .66 acres in the same village, in which the land in dispute is situated, was sold for Rs. 2,000 on March 13, 1958 at the rate of Rs. 94 per katha.

Another sale transaction related to the sale of 22.5 decimals of land on November 22, 1958 at the rate of Rs. 58 per katha. A third transaction related to the sale of .06 acre of land for Rs. 100 on August 12, 1957 at the rate of Rs. 52 per katha. The Additional District Judge excluded these sale transactions out of consideration on the ground that the plots which were the snbject matter of those sales were at some distance from the acquired land The High Conrt took the view, in onr opinion rightly, that these sale transactions coulcl not be excluded altogether from consideration. The High Conrt also took into account three other sale transactions which had been relied upon by the appellant.

Those sale transactions related to sale of five dhurs of land for Rs. 275 on October 19, 1957 at the rate of Rs. 1,100 per katha, 15 dhurs of land for Rs. 750 on November 5, 1956 at the rate of Rs. 1,000 per katha and 15 dhurs of land for Rs. 750/- on September 28, 1956 at the rate of Rs. 1,000 per katha. One katha is said to consist of 20 dhnrs. The land which was the subject of these sale transactions abntted the road and, from the small size of the plots, it appears that they were pnrchased for the pnrpose of constructing

K. M. SINGH v. BIHAR (Khanna, l.) 587

shops or similar buildings thereon. The land now sought to be acquir- A ed cl•>es not abut the road. It is in evidence that in making acquisilion the strip of the land of the appellant up 10 a depth of !00 ft. from ) the road was not acquired. The High Court on taking into consideration the above three sale transactions relied upon by the appellant and '< three sale transactions relied upon by the respondent found the mean price of the land covered by the six sale deeds to be a little more than Rs. 460 per katha. The High Court in the circumstances came to the B • conclusion that the just and fair market value of the land should be assessed at Rs. 475 per katha.

The above rate included, according to the High Court, the potential value of the land. In addition to that, the appellant was held entitled to 15 per cent solatium for compulsory acquisition. We find no infirmity in the above approach of the High Court.

The finding of the High Court is based upon consideration of the evidence adduced in the case, and no cogent ground has been C shown to us as to why we should interfere with that finding.

We may observe that the High Court excluded from consideration r certain sale deeds executed by the appellant. These transactions related to small plots of land situated on the roadside and were entered into after the land in dispute had been notified for acquisition. In the opinion of the High Court, the said sale deeds could not form a safe D criterion for assessing the market value of the acquired land because • they had been executed by the claimant himself after the notification.

It was also observed that the plots sold were quite suitable for shop or residential purposes.

We find no sufficient reason to take a con- _. trary view.

Section 23 of the Act provides that in determining the amount of E compensation to be awarded for land acquisition under the Act the Court shall inter alia take into consideration the maret value of the r land at the date of the publication of the notification under section 4 of the Act. Market value means the price that a willing purchaser would pay to a willing seller for the property having due regard to its existing condition with all its existing advantage~ and it~ potential possibilities when laid out in the most advantageous manner excluding any F advantages due to the carrying out of the. scheme for which the property is compulsorily acquired. In considering market value the disinclination of the vendor to part with his land and the urgent necessity of the purchaser to buy should be disregarded. There is an element of guess work inherent in most cases involving detennination of the market value! of the acquired land, but this in the very' nature of things cannof be helped. The essential thing is to keep in G view the relevant factors prescribed by the Act. If the judgment of the High Court reveals that it has takeh into consideration the relevant ,....., factors, its assessment of the fair market value of the acquired land should not be disturbed. No such infirmity has been brought to our notice as might induce us to disturb the finding of the High Court.

The appeal consequently fails and is dismissed but in the circumstances ;. without costs.

P.H.P.

A ppal dismissed . •

THE STATE OF BUIAR

March 10, 1976

H. R. KHANNA

P. K. GOSWAMI, JJ.

Land Acquisition Act, 1894

Sections 23 and 24

s. 18

s. 23

V. S. Desai

P. Singh

R. C. Prasad

KHANNA

article 133(1)

Tenduni

Shahbad district

section 4

section 4

January 1, 1959

section 18

Arrah

March 13, 1958

November 22, 1958

August 12, 1957

October 19, 1957

November 5, 1956

September 28, 1956

Section 23

section 4


5 88

KISHORI LAL v.

BIRDIIl LAL & ORS.

March 10, 1976

[A. N. RAY, C.J., M. H. BEG AND JASWANT SINGH, JJ.]

(,'onstitution of lndia. Art. 226-Concurrent decisions of Revenue authorlties -Apparent error of law-Whether High Court's interference justified.

RajastT1an Tenancy Act, 1955, S. 5 (44), essential conditions, if satisfied- Rejection of alternative case under s. 180.

The appellant brought a suit for possession of land_ against re.spondent Birdhi Lal, under Ss. 180 and 183 of the Rajasthan Tenancy Act, 1955. The Assistant Collector, Baran, dismissed the suit, but the Revenue Appellate Authority allowed his appeal and held that Birdhl Lal was a trespasser. A further appeal by Birdhi Lal was dismissed by the Board of Revenue, Rajasthan.

Thereafter, his application made under Art. 226 was allowed by the High Court.

The High Court held Birdhi Lal to be a tenant within the meaning of s. 5 ( 43), __. and not a trespasser as conceived by s. 5 ( 44). On appeal by special leave, the ' appellants contended before this Court that the High Court was not justified in exercising appellate jurisdiction and interfering with the concurrent opinions of the Revenue authorities. It was further contended that even if Birdhi Lal was held to be a tenant. he was liable to be ejected, as the original suit had been fran1ed alternatively under s. 180 of the Act.

Disn:1issing the appeal, the court HELD: (1) The material on record does not establish that Birdhi Lal took or retained possession of the land without authority. The essential conditions for holding Birdhi Lal to be a trespasser under s. 5(44) were manifr, stly not ,,( satisfied.

The High Court was right in rectifying the error of law apparent on the face of the record and quashing the judgments of the Appellate Revenue Authority and the Board of Revenue.

[589F-H & 590AJ

(2) The alternative case under s. 180 required necessary averments and r proof of facts which were absent in the case. The plea therefore, cannot be entertained.

[590 C-DJ CIVIL APPELLATE JuRISDICTION : Civil Appeal No. 1436 of 1975.

Apprnl by special leave from the Judgment and Order dated 10-3-1975 of the Rajasthan High Court in D. B. Civil Writ Petition No. 384 of 1968.

Ahmed Bux, Beni Madhav Sharma, M/s. V. J. Francis & R. A.

Gupta, Advocates for the appellants.

S. M. Jain & Sushi/ Kumar Jain, Advocates for respondent No. 1.

The Judgment of the Court was delivered by- JAsWANT SINGH, J.-This appeal by special leave is directed against the judgment dated March 10, 1975 of the High Court of Rajasthan at Jodhpur passed in Civil Writ Petition No. 384 of 1968. /-· The facts leading to this appeal are : On July 1, 1961, Kishori Lal, the appellant herein, brought a suit in the court of the Assistant Collector, Baran, against Birdhi Lal, respondent No. 1, for possession of land comprised in khasra Nos. 513, 669 and 678 situate in "- village Balakhera of Anta Tehsil of Kota District under sections 180 and 183 of the Rajasthan Tenancy Act, 1955 (hereinafter referred to as the Act). By his judgment dated December 24, 1962, the . .

KISHORI LAL v. BIRDHI LAL (Jaswant Singh, J.) 5 89

Assistant Collector dismissed the suit.

The appellant thereup-0n preferred an appeal to the Revenue Appellate Authority who allowed the , same by his judgment dated November 9, 1963, and reversing the ) juc; lgment of the Assistant Collector decreed the suit holding that Birdhi Lal was a trespasser.

Aggrieved by the judgment and decree '< of the Revenue Appellate Authority, Birdhi Lal took the matter in further appeal to the Board of Revenue, Rajasthan, but remained unsuccessful as the members of the Board affirmed the view taken by the Revenue Appellate Authority.

Dissatisfied with the decisions of • the Revenue Appellate Authority and the Board of Revenue, Rajasthan, Birdhi Lal approached the High Conrt of Raiasthan by means of a petition under Article 226 of t]le Constitution.

The High Court by its aforesaid judgment and order dated March 10, 1975, allowed the petition and held that Birdhi Lal being a tenant within the meaning of section 5 ( 43) of the Act and not a trespasser as conceived by section 5 ( 44) of the Act, was not liable to be e}, oeted from the land.

Dissatisfied with this judgment, Kislhori Lal has come up 'rthis Court.

The learned counsel for the appellant has, while supporting the appeal, vehemently tried to press upon us that as the High Court has exercised appellate jurisdiction and substituted its own opinion for the opinion of the Revenue authorities contrary to the well estab-

1 Iished principles of law, the impugned judgment cannot be sustained.

Elaborating his submission, the learned counsel has submitted that since both the Revenue Appellate Authority and the Board of Reve- " nue had concurrently held that Birdhi Lal was a trespasser and there was no error apparent on the face of the record, the High Conrt was not justified in interfering with the aforesaid decisions of the Revenue Appellate Authority and the Board of Revenue.

The conr tention advanced on behalf of the appellant is, in our opinion, wholly untenable.

The expression 'trespasser' is defined in section 5 ( 44) of the Act as follows:-

"5 ( 44). Trespasser shall mean a person who takes or retains possession of land without authority or who prevents another person from occupying land duly let out to him".

The above definition makes it clear that in order to be able to succeed in his suit, Kishori Lal had to show that Birdhi Lal had taken or retained possession of the land without authority or that he had prevented him from occupying the land duly let out to him.

In the instant case, there was no allegation by the appellant in his plaint that he was prevented by Birdhi Lal from occupying the land which had been let out to him.

The only point that we are, therefore, left to determine is whether Birdhi Lal took poss, ssion or retained pos- ,--( session of the land without authority.

The material on the record does not at all establish any of these elements.

On the other hand, as rightly pointed out by the High Court, the Parcha lagan, Exhibit , A-3 and Pantinama, Exhibit A-4 clearly show that the land in qnes- ,. tion had been let out by the appellant to Birdhi Lal on payment of rent.

As the essential conditions for holding Birdhi Lal to be a trespasser were manifestly not satisfied in the present case, the High •

SUPREME COURT REPORTS [1976] 3 S.C.ll.

Court was perfectly right in rectifying the error o[ law apparent on the face of the record and quashing the judgments of the Appellate Revenue Authority and the Board -of Revenue. \ It was next urged that even if the respondent Birdhi Lal is held to be a tenant by reason of the Pantinama (Ex. A-4), he was liable to 'f"' be ejected as the appellant Kishori Lal had framed his suit alternatively under section f80 of the Act. Reference to section 180 of the Act shows that it applies only to suits for "ejectment of Khudkasht or Ghair-Khatedar tenants or sub-tenants".

Khudkasht is defined in • section 5, sub s. 23 as land "cultivated personally by an estate holder".

It also includes "land recorded as Khudkasht, sir, havala, niji-jot, gharkhed in settlement records" at the commencement of the Act as well as "land allotted after such commencement as Khudkasht unde~ any Jaw".

Similarly, the components of rights to sub-tenancy and gair khatedari tenancies are also determined by the provisions of the Act.

The High Court had recorded the finding, on this part of the case : "It may be mentioned at the outset that although the suit was raised by respondent Kishori Lal under sections 180 and 183 of the -1 'Act as aforesaid, his claim was not upheld under section 180 so that ' the suit was decreed as one under section 18~". In other words, findings of the -Revenue Courts as well as the High Court repel the alternative case sought to be made out before us.

It required necessary averments and proof of facts which were absent in the case. It ' was, therefore, a completely hopeless plea which we cannot entertain at this stage.

For the foregoing reasons, we do not find any merit in this appeal which is hereby dismissed with costs.

M.R.

Appeal dismissed. ---(

88

KISHORI LAL

A. N. RAY, C.J.

M. H. BEG

JASWANT SINGH, JJ.

Art. 226

Tenancy Act, 1955

S. 5

s. 180

Ss. 180 and 183

Rajasthan Tenancy Act, 1955

Birdhl Lal

Birdhi Lal

Board of Revenue, Rajasthan

Art. 226

s. 5

s. 5

s. 180

Birdhi Lal took

s. 5(44)

s. 180

Rajasthan High Court

Ahmed Bux

Beni Madhav Sharma

V. J. Francis

R. A.

Gupta

S. M. Jain

Sushi/ Kumar Jain

JAsWANT SINGH

Kishori Lal

Kota District

sections 180 and 183

Rajasthan Tenancy Act, 1955

November 9, 1963

High Conrt of Raiasthan

Article 226

March 10, 1975

section 5

section 5

Kislhori Lal

section 5

Kishori Lal

section 180

section 5

s. 23

Kishori Lal

sections 180 and 183

section 180

section 18