IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED :13.3.2009 C O R A M : THE HONOURABLE MR. JUSTICE K. CHANDRU W.P.Nos.19088 & 17115 of 1997, 10192, 18446 and 18447 of 1998, 4083 of 1999 and 18339 of 2000 and connected MPs. R.Sivashanmugam .. Petitioner in WP.19088 of 1997 1. Vijayammal 2. Neelavani Thayar .. Petitioners in WP.17115 of 1997 Smt.Yasodai Ammal .. Petitioner in WP.10192 of 1998 1. S.R.Sampath 2. S.Yadugiri Ammal .. Petitioners in WP.18446 of 1998 Meera alias Shenbaga Lakshmi rep.by her Constituted Attorney Shri S.R.Sampath .. Petitioner in WP.18447 of 1998 N.Chandrasekaran .. Petitioner in WP.4083 of 1999 1. K.R.Balasubramania Mudaliar (dead) 2. Tmt.Saraswathi 3. Tmt.Meera Sankaramoorthi 4. Rajasekaran 5. Tmt.Soundari 6. Sivaraman .. Petitioners in (petitioners 2 to 6 brought on record WP.18339 of 2000 as LRs of deceased first petitioner by order dated 04.11.2008 in WPMP.No. 1648 of 2008 in WP.18339 of 2000) -vs- 1. The State of Tamil Nadu, rep.by the Secretary to Government, Law Department, Fort St.George, Chennai-9. ..R1 in all the WPs. https://hcservices.ecourts.gov.in/hcservices/ 2. The Assistant Commissioner, (Land Reforms), Erode. ..R2 in WP.No.19088 of 1997 3. The Assistant Commissioner, (Land Reforms), Coimbatore. .. R2 in WP.No.17115 of 1997 4. The Assistant Commissioner, (Land Reforms),Tiruchirappalli. .. R2 in WP.No.10192 of 1998 5. The Authorised Officer (Land Reforms), Tiruchirappalli. .. R2 in WP.No.18446 of 1998 and WP.No.18447 of 1998 6. The Authorised Officer & Assistant Commissioner (Land Reforms), Erode. .. R2 in WP.No.4083 of 1999 7. The Assistant Commissioner, (Land Reforms), Villupuram. .. R2 in WP.No.18339 of 2000 Jagadeesan S/o. Late Balasubramania Mudaliar .. R3 in WP.No.18339 of 2000 (3rd respondent impleaded as LR of the deceased petitioner herein as 3rd Respondent in the WP.No. 18339/2000 as per Court order dated 04.11.08 in WP.MP.No.1648/08 in WP.No.18339/2000) PRAYER : Petitions filed under Article 226 of the Constitution of India praying for the issuance of a writ of declaration declaring that the Tamil Nadu Land Reforms (Fixation of Ceiling on Land) Second Amendment Act, 1994, Tamil Nadu Act No.11 of 1996 as ultra vires, unconstitutional and strike down the same. For petitioner in W.P.Nos.19088 of 1997, 4083 of 1999 & 18339 of 2000 :: Mr.A.Sivaji For petitioner in W.P.Nos.17115 of 1997 & 10192 of 1998 :: Mr.C.V.Vijayakumar for Mr.T.R.Rajaraman For petitioner in W.P.Nos.18446 & 18447 of 1998 :: Mr.T.K.Seshadri, SC for Mr.M.S.Sampath For respondents :: Mr.R.P.Kabilan, Addl.A.G. Asstd.byMr.A.Arumugam, Spl.GP https://hcservices.ecourts.gov.in/hcservices/ O R D E R In these writ petitions, the challenge is to the amendment brought in by the Tamil Nadu Act 11 of 1996 to the Tamil Nadu Land Reforms (Fixation of Ceiling on Land) Second Amendment Act, 1994 and a prayer is sought to declare them as ultra vires and unconstitutional. 2. Sections 4 to 6 of the Amendment Act reads as follows:- ''S.4. Tamil Nadu Act 58 of 1961, as subsequently modified, to have effect subject to modifications.- The principal Act shall, on and from the 6th day of April 1960, have effect, as if, section 22 had been renumbered as sub- section (1) of that section and after sub-section (1) as so renumbered, the following sub-section had been added, namely:- ''2. For the purpose of sub-section (1) if any transfer or partition has the effect of reducing the extent of surplus land in excess of the ceiling area, such transfer or partition, whether bona fide or not, shall be construed as defeating the provisions of this Act". S.5. Validation.- Notwithstanding anything contained in any law for the time being in force or in any judgment, decree or order of any court or other authority, all acts done or proceedings taken in respect of cases falling under section 22 of the principal Act by the authorized officer before the date of the publication of this Act in the Tamil Nadu Government Gazette, which are in conformity with the provisions of section 22 of the principal Act, as amended by section 4 of this Act, shall, for all purposes be deemed to be, and to have always been, validly done or taken in accordance with law, as if section 22 of the principal Act as amended by section 4 of this Act had been in force at all material times when such acts or proceedings were done or taken. S.6. Reopening of certain cases.- Notwithstanding anything contained in any law for the time being in force or in any judgment, decree or order of any court or other authority, but subject to the provisions of section 21-A of the principal Act, any proceeding taken or order passed under the principal Act which has been disposed of before the date of the publication of this Act in the Tamil Nadu Government Gazette, contrary to the provisions of section 22 of the principal Act, as https://hcservices.ecourts.gov.in/hcservices/ amended by Section 4 of this Act, shall be reopened and disposed of in accordance with the provisions of section 22 of the principal Act as so amended: Provided that no such proceeding or order shall be reopened under this section after the expiry of a period of five years from the date of the publication of this Act in the Tamil Nadu Government Gazette: Provided further that no such proceeding or order shall be reopened unless the person affected has had a reasonable opportunity of being heard." 3. Before the amendment, the original section 22 read as follows:- ''S.22. Transfer or partition made on or after the date of the commencement of this Act, but before the notified date.- (1) Where, on or after the date of the commencement of this Act, but before the notified date, any person has transferred any land held by him by sale, gift (other than gift made in contemplation of death), exchange, surrender, settlement or in any other manner whatsoever except by bequest or has effected a partition of his holding or part thereof, the authorized officer within whose jurisdiction such land, holding or the major part thereof is situated may, after notice to such person and other persons affected by such transfer or partition and after such enquiry as he thinks fit to make, declare the transfer or partition to be void if he finds that the transfer or the partition, as the case may be, defeats any of the provisions of this Act." 4. The statement of objects and reasons for bringing the amendment as set out in the original Bill may be usefully reproduced below:- ''Section 22 of the Tamil Nadu Land Reforms (Fixation of Ceiling on Land) Act, 1961 (Tamil Nadu Act 58 of 1961), provides that any transfer or partition, made on or after the date of the commencement of the Act, but before the notified date, may be declared to be void by the authorised officer, if he finds that such transfer or partition defeats any of the provisions of the Act. In many cases the authorised officers while implementing the Act have passed orders under section 22 holding that the transfers or partitions effected during the said period as void. The orders passed under section 22 have been taken on appeal to the Land https://hcservices.ecourts.gov.in/hcservices/ Tribunal and the High Court by parties aggrieved. The High Court in a batch of cases in Civil Revision Petitions No.1824, 1825/65 and 44/66 has held that the transfer made during the said period can be declared void only if the authorized officer can come to the conclusion that the transaction is sham, nominal and bogus. The above judgment of the High Court has been taken on appeal to the Supreme Court by the State Government. However, during the pendency of appeal before the Supreme Court, the authorized officers and the Land Tribunals have followed the judgment of the Madras High Court and in many cases the transfer effected during the said period have been held to be valid. 2. Subsequently, the Supreme Court in the appeal preferred by the State Government referred to above and reported in Authorized Officer, Thanjavur -vs- S.Naganatha Ayyar (AIR 1979 SC 1487) has reversed the judgment of the Madras High Court and interpreted Section 22 of the Act to the effect that if any transfer defeats the provisions of the Act by reducing the extent of surplus land in excess of the ceiling available from any person such transaction, bona fide or not shall be void in the matter of computation of permissible area and the surplus area. 3. Based on the said judgment of the Supreme Court, many cases in which orders have been passed earlier holding the transaction as valid, have been reopened and surplus land has been declared. All the past cases which have been re-opened, are now challenged before the Tamil Nadu Land Reforms Special Appellate Tribunal on the ground that the Act does not confer any right or power on the authorized officer to review such cases which have reached finality. 4. It has, therefore, been decided to amend section 22 of the said Act so as to be in consonance with the principles laid down by the Supreme Court in the case referred to above and to make it clear that if any transfer or partition, has the effect of reducing the extent of surplus land in excess of the ceiling area, such transfer or partition whether bona fide or not, shall be construed as defeating the provisions of the said Act. 5. It has also been decided to make provisions for validating all acts done or proceedings taken by the authorised officer and to reopen the past cases, based https://hcservices.ecourts.gov.in/hcservices/ on the said judgment of the Supreme Court. The Bill seeks to give effect to the above decision." 5. These writ petitions were admitted on various dates and on notice from this Court, counter affidavits have been filed by the State in all the writ petitions. Pending the writ petitions, in most of the cases, stay of dispossession was granted by this Court. But, however, liberty was given to proceed with the other proceedings. In some cases, there was an absolute stay granted by this Court. 6. Initially an objection was raised about the maintainability of the writ petitions as the declaratory relief was not made before the Tamil Nadu Land Reforms Special Appellate Tribunal. Though the decision of the Supreme Court in L.Chandrakumar -vs- Union of India reported in (1997) 3 SCC 261 supports such view, it was contended that the Tamil Nadu Land Reforms Special Appellate Tribunal was not having a Judicial Member and was functioning only with an Administrative Member and, therefore, the Court should not refuse to entertain the writ petition. This Court, by an order dated 11.12.1997 permitted the writ petitions to be entertained by this Court in view of the fractured nature of the Appellate Tribunal. Subsequently it must also be noted that the Tribunal itself had been abolished. 7. In W.P.No.17115 of 1997, a miscellaneous petition was also filed seeking to raise certain additional grounds by the petitioner. But till date, no steps were taken to get the petition ordered by this Court. 8. While one set of writ petitions came up for hearing on 04.11.2008, W.P.No.4083 of 1999 came up on 19.12.2008. Since in all the writ petitions, identical contentions have been raised, they were heard together and a common order is being passed. 9. When orders were passed by the Authorised Officer, the said matter came up for consideration in a revision petition before this Court. The decision in the Civil Revision was rendered in S.Naganatha Ayyar -vs- Authorised Officer, Thanjavur and another reported in (1970) 84 Mad LW 69. This Court while allowing the revision petition held that the Land Reforms Act being confiscatory in nature, the public authority invested with the power to enquire into and to invalidate a transfer should act reasonably, and that such a power should be construed beneficently in favour of the subject who is affected by the statute. It was also held that the transactions entered into in anticipation of the Ceiling Act will not be hit by the provisions preventing such transfers except where they are mala fide or colourable. It was also held by this Court that Section 22 covers only sham, nominal and bogus transfers. https://hcservices.ecourts.gov.in/hcservices/ 10. The relevant passage found in the judgment may be usefully extracted below:- ''..... Section 22 seems to cover only those sham, nominal and bogus transfers which are only intended to defeat the provisions of the Act. If the Legislative intention is also to invalidate all bona fide transactions during the relevant period, it would have made certain consequential provisions as to what are the rights of the transferor and the transferee in relation to the property conveyed, and how the resultant equities between the transferee and the transferor have to be worked out. This view that Section 22 will cover only transactions of sham, nominal and bogus characters which are intended only to defeat the provisions of the Act will not the inconsistent with the object provided in Section 7." 11. Thus saying all the transactions other than those which come within the mischief of the section was allowed to go outside the purview of section 22. Therefore, any transfer of land which took place between 06.4.1960 and 02.10.1962 namely the period between the date of commencement of the Act and the notified date respectively can be declared void by the Authorised Officer only if he found that the transfer had defeated any of the provisions of the Act. 12. The matter was taken on appeal by the State and heard by the Supreme Court. The Supreme Court allowed the appeal preferred by the Authorised Officer vide its decision in Authorised Officer, Thanjavur and another -vs- S.Naganatha Ayyar and others reported in (1979) 3 SCC 466. The Supreme Court in paragraphs 11 and 12 of the said judgment held as follows:- Para 11.''The learned Judge seems to take a liberal view that transactions entered into in anticipation of the Ceiling Act will not be hit by the provisions preventing such transfers except where they are mala fide or colourable. The reason partly turns on semantics and the court argues with lexical support: “The word ‘defeat’ normally means ‘overcome, thwart, evade, frustrate, circumvent, bypass, disappoint, prevent the accomplishment of’ ... the word ‘defeat’ in Section 22 has to be taken as having been used to import sinister motive. Maxwell on the Interpretation of Statutes, twelfth Edn., after stating that the courts will not be astute to narrow the language of a statute so as to allow persons within its purview to escape its net, that the statute has to be applied to the substance rather than the https://hcservices.ecourts.gov.in/hcservices/ mere form of transactions, thus defeating any shifts and contrivances which parties may have devised in the hope of falling outside the Act.” The conclusion categorically reached by the High Court virtually emasculates Section 22 as we understand its object and import. The learned Judge winds up with these words: “On a due consideration of the matter, I hold that under Section 22 of the Act the authorised officer is entitled to declare as void only those transfers which are sham and nominal entered into with the avowed object of defeating the provisions of the Act, without any bona fide intention to transfer title. So in the light of the view expressed above the facts of each case have to be considered.” Section 22, literally read, leads only to one conclusion, that any transfer, bona fide executed or not, is liable to be declared void by the Authorised Officer “if he finds that the transfer defeats any of the provisions of this Act”. There is not the slightest doubt that severally and cumulatively the provisions of the Act seek to make available the maximum extent of land, in excess of the ceiling, to be vested in Government for fulfilment of its purposes. Chapter II contains a fasciculus of provisions in this behalf and if any transfer carves out of the surplus area some land, pro tanto, the provisions of the Act are defeated. Indeed, it is not seriously disputed that such will be the conclusion if we do not read into the provisions either the condition that it does not apply to bone fide transfers, as Shri Ramamurthi would have it, or does not apply to any transfers other than sham, nominal or bogus transfers, as the High Court would have it. A policy-oriented interpretation tallies with the literal construction in the present case. The mischief rule in Heydon case and the grammatical construction which is the Golden Rule converge to the same conclusion in the present case. Para 12. The policy of the law of land reform with drastic limit on holdings often drives large holders to evade by manouvres. They make gifts, execute sales or settlements, enter into other dealings to save their properties from being taken by the State. May be in a few cases, the owner has real necessity. But why sell only on the eve of land legislation? Why execute https://hcservices.ecourts.gov.in/hcservices/ deeds, though for good purposes, only where the bill fixing ceilings is round the comer? By and large, the strategies of extrication of holdings from the arm of the law is the reason that prompts sudden affection for making gifts, sudden realisation of debts due and sudden awareness of family necessity. The legislature, astute enough not to be outwitted in its objective, puts a blanket ban on transfers which, in effect, defeat its provisions. This may cause hardship to some but every cause claims martyrs. Individual trauma is inevitable while ushering in a new economic order. This is the rationale of Section 22 of the Ceiling Act. To allow the sense of the text and to mix alien concepts is to debase the statutory metal. Likewise, laws are not value-free and so he reads the symbols of words best who projects in the process the values of the legislation as distinguished from his own. Reading other values into the legislators’ words may judicially demonetize the statute and break the comity between constitutional instrumentalities". 13. It was concluded in paragraphs 16 and 17 of the Naganatha Ayyar's case and the same may be usefully extracted below:- Para 16. In the interpretation of Section 22 we too are Portia men. For this reason we reverse the view of the High Court that Section 22 will not apply to nullify any transaction of transfer or partition unless it is further shown that it is sham, nominal or bogus. Nor do we agree with Shree Ramamurthi that even if a transaction defeats the ceiling provisions, it may still be valid if the transfer is, from an individual point of view bona fide. The short reply is that from the community’s angle, especially the landless community’s angle hungering for allotment, the alienation, however necessary for the individual, is not bona fide vis-a-vis the community. Para 17. Therefore, we allow the appeal in the light of the interpretation we have adopted, restore the Tribunal’s holding and rule that if any transfer defeats the provisions of the Act by reducing the extent of surplus land in excess of the ceiling available from any person such transaction, bona fide or not, is void in the matter of computation of the permissible area and the surplus area. May be, that the transaction may be good for other purposes or may not be. The Authorised Officer is within his power if he ignores it as void for purposes of Section 22 Section 7 and other ceiling-related provisions." https://hcservices.ecourts.gov.in/hcservices/ 14. In order to give effect to the said decision, the impugned amendment came to be made by the Legislature and it was also made to come into effect from the date of the principal enactment. In the counter affidavit filed by the State it is stated that the amendments were given retrospective effect as per the principles laid down by the Supreme Court in Naganatha Ayyar's case (cited supra). It is also brought to the notice that the amendments are made to give effect to the principles laid down in Article 39(b) and (c) of the Constitution and found in Part IV containing the Directive Principles of State Policy. As the principal Act was also included in the IX Schedule to the Constitution, it is not liable for any judicial review on the ground of violation of any of the Fundamental Rights in view of Article 31-B of the Constitution. 15. Mr.T.K.Seshadri, learned Senior Counsel appearing for some of the petitioners contended that the amendments are ultra vires the Constitution. In this context, he referred to the judgment of the Supreme Court in P.Sambamurthy and others -vs- State of Andhra Pradesh and another reported in (1987) 1 SCC 362. Reliance was placed upon the following passage found in paragraph 4, which may be usefully reproduced below:- Para 4. ''Now if the exercise of the power of judicial review can be set at naught by the State Government by overriding the decision given against it, it would sound the death knell of the rule of law. The rule of law would cease to have any meaning, because then it would be open to the State Government to defy the law and yet to get away with it. The proviso to clause (5) of Article 371-D is therefore clearly violative of the basic structure doctrine". 16. For the very same proposition, he also placed reliance upon the judgment of the Supreme Court reported in 1993 Supp (1) SCC 96 (II) in the matter of : Cauvery Water Disputes Tribunal. The following passage found in paragraph 77 is relevant and it may be usefully reproduced below:- Para 77. ''.............Hence any executive order or a legislative enactment of a State which interferes with the adjudicatory process and adjudication by such Tribunal is an interference with the judicial power of the State. In view of the fact that the Ordinance in question seeks directly to nullify the order of the Tribunal passed on June 25, 1991 it impinges upon the judicial power of the State and is, therefore, ultra vires the Constitution." https://hcservices.ecourts.gov.in/hcservices/ 17. Based upon these two judgments, the learned Senior Counsel submitted that since the Authorised Officer has the trappings of a Court and already orders have been passed by the said Officer, which had become final, the same cannot be reopened. The decision rendered by the Authorised Officer is a judicial order and the amendment, inasmuch as the impugned Act gives power to reopen such of those cases, should be declared as unconstitutional. 18. Mr.Vijayakumar, learned counsel appearing for M/s.T.R.Rajaraman, submitted that invalidating a bona fide transfer that too by a retrospective amendment is wholly illegal. The State Legislature lacks legislative competence for enacting such an amendment. For this purpose, he placed reliance upon the judgment of the Supreme Court in Shri Prithvi Cotton Mills Ltd. and another -vs- Broach Borough Municipality and others reported in (1969) 2 SCC 283. 19. He also referred to the judgment of the Supreme Court in S.R.Bhagwat and others -vs- State of Mysore reported in (1995) 6 SCC 16. After referring to paragraphs 15, 17 and 18, he submitted that once a decision made by the authority has become final and the State has not challenged the said decision before a competent Court, the legislative power cannot be pressed into service to undo the binding effect of such orders passed by the Court. 20. He also placed reliance upon the judgment of the Supreme Court in State of Tamil Nadu -vs- Arooran Sugars Ltd. reported in (1997) 1 SCC 326 and wanted to emphasize that even if the Legislature has power to make a retrospective legislation, it cannot invalidate the decisions which were rendered already. 21. For the very same purpose, he also placed reliance upon the judgment of the Supreme Court in Commr. Karanataka Housing Board -vs- C.Muddaiah reported in (2007) 7 SCC 689. Reliance was placed upon paragraph 20 of the said judgment, which reads as follows:- Para 20. ''In that case