Case: HARDEV SINGH &amp; ORS Vs. PRESCRIBED AUTHORITY, KASHIPUR &amp; ANR

case of Escorts Farms Ltd., Previously Known As M/S. Escorts Farms (Ramgarh) Ltd. Vs. The Commissioner, Kumaon Division, Nainital, U.P. And Ors. (2004) 4 SCC 281 , and has been answered as under :- 33. The Statement of Objects and Reasons for amending Section 2 of the Govt. Grants Act, 1895 by UP Amendment Act of 1960 makes it clear that the State Legislature intended to apply only the provisions of Land Reforms Act and Ceiling Act to the lands held by persons under the Govt. Grants Act. The statements of objects and reasons read thus:- Provisions of Section 2 of the Government Grants (UP Amendment) Act, 1959, have the effect of saving a grant of an agricultural lease by or on behalf of the Government from the operation not only on the Acts mentioned therein, but also of any other law, including the law for imposition of ceiling on land holdings, that might be made in future. There is also an apprehension that the result of the wordings of section 2 may be to undo the vesting of estates of government grantees under section 4 of the UP Zamindari Abolition and Land Reforms Act, 1950. With a view, therefore, to remove any such apprehension and to put the UP Imposition of Ceiling on Land Holdings Bill, 1959, when enacted, beyond the purview of the Government Grants Acts, this Bill is being introduced. Vide UP Gazette Extraordinary, dated February 3, 1960. 34. Land Reforms Act, 1950 being saved by sub-section (3) of Section 2 of Govt. Grants Act is applicable to the govt. grants. Under Section 18 (l)(c) of Land Reforms Act, a govt. grantee holding land rent-free was allowed to retain possession of the land as Bhumidhar. Section 18 of the Land Reforms Act with clause (c) in sub-section (1) reads thus:- Section 18. Settlement of certain lands with intermediaries or cultivators as Bhumidar - (1) Subject to the provisions of Sections 10,15,16 and 17, all lands - (a) in possession of or held or deemed to be held by an intermediary as sir, khudkasht or an intermediary grove. (b) held as a grove by, or in the personal cultivation of a permanent lessee in Avadh. (c) held by a fixed-rate tenant or a rent-free grantee as such, or (d) held as such by - i) an occupancy tenant, Possessing the ii) a hereditary tenant, right to transfer iii) a tenant on Patta the holding by sale Dawami or Istamrari referred to in Section 17, (e) held by a grove holder. On the dale immediately preceding the date of vesting shall be deemed to be sell led by the State Government with such intermediary, [lessee, tenant, grantee or grove-holder] as the case may be, who shall, subject to the provisions of this Act. be entitled to take or retain possession as a bhumidhar thereof. 35. As seen above, proviso below sub-section (3) of Section 2, of Govt. Grants (UP Amendment) Act makes applicable Ceiling Act to the land held by a grantee under the Govt. Grant. It has already been noted that a Govt. Grantee or a lessee is covered within the definition of tenure holder given in under clause (17) read with clause (9) of Ceiling Act and the definition of person in Section 4 (33) of the UP General Clauses Act. Thus conjointly reading the provisions of the Ceiling Act and the Land Reforms Act, the grantee of land from the government is a holder of land in the status of a Bhumidhar and the land can be subjected to ceiling limit. To the lands held by the company, which is grantee of the Govt., the provisions of Ceiling Act would be attracted. Such grantee being a lessee from Government has no right to transfer the land without permission of the Government. It can grant leases or sub-leases under the UP Tenancy Act but the lessees/sub-lessees can claim no rights contrary to the terms of the grant. All the transfers made by the Company or Farm by sale or lease contrary to the terms of the Govt. Grant create no independent rights in favour of the said transferees or lessees. The claims of transferees and lessees based on the provisions of UP Tenancy Act were, therefore, rightly negatived by the ceiling authority and the High Court. 30. We may also reproduce the observations made in paragraph 32 of the Escorts Farms Ltd. (Supra) :- 32. No action of the revenue authorities can, therefore, estop the ceiling authorities from ignoring the claims of tenancy rights on the land set up by the lessees/sub-lessees. The rights between the government and the grantee are strictly to be regulated by the terms of the grant and in accordance with the Govt. Grants (UP Amendment) Act, 1960. The entries in revenue records and recognition of any tenancy rights of the lessee and/or sub-lessee as hereditary tenant, Sirdars or Bhumidhars under the UP Tenancy Act can have no adverse legal effect on the Govt. Grant which has an overriding effect under the Govt. Grants Act. No estoppel can operate against the overriding statute so as to bind the ceiling authorities to accept the tenancy rights of the lessees/sub-lessees as indefeasible in application of Ceiling Act to the lands in question. 31. From the aforesaid discussions, it is clear that the provisions of Ceiling Act would be applicable in case of grantee of Government under a lease agreement. The grantee being a lessee from the Government has no right to transfer the land without fulfilling the conditions stipulated in Clause 9 of lease deed. The terms of the lease deed though provide for sub-lease for agricultural purposes but sub-lessees can claim no independent rights as a tenure holder. 32. Thus, the appellant being a sub-lessee continues to be an ostensible holder of land and the government grantee, the Respondent No. 2, to be the real holder and the ceiling authorities as well as the High Court have rightly dismissed the claim of the appellant.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]21. The terms of the grant go to show that 4805 acres of land situated in Pargana Bazpur, District Nainital, were leased out to the Government Lessee.22. Condition No. 9 of the Grant lays down the conditions to be fulfillled in the event of lessee transferring the lease land or a portion thereto except transfer by way of an inheritance. Conditions laid down by Clause 9 of the grant has been made inapplicable in case of sub-leases made by the lessee while subletting the land in the ordinary course of agriculture.23. A perusal of the aforesaid provision makes it clear that the grantee was only allowed to transfer the land on fulfillment of the conditions enumerated in the said clause.25. Thus, a conjoint reading of Clause 5 of the sub-lease and Clause 9 of the Government lease clearly stipulates that acquisition of rights, if any, as independent tenure holder can only be by following the stipulations as contained in Clause 5 of the sub-lease and Clause 9 of the Government lease, which, in the present case, admittedly, has not been followed.26. An analysis of the terms and conditions of grant makes it clear that any transfer of land by the Government Lessee was subject to fulfilment of the conditions of the government lease and sub-lease and non-compliance of the conditions and transfer made without fulfilling the conditions would be void. Though, the conditions of grant allowed sub-lease of the land in the ordinary course of agriculture but contrary to the terms of grant, the sub-lessee can claim no independent tenancy right so as to frustrate the terms and tenure of the grant, as the sub-lease executed for ordinary course of agriculture cannot be treated as transfer for want of compliance of the conditions enumerated in the Clause itself. Thus, the appellants in their capacity as sub-lessee shall not acquire the status of an independent tenure holder.27. Admittedly, the lease in favour of Respondent No. 2 was made under the Government Grants Act, 1895. Respondent No. 2 was put in possession of the land under the terms and conditions of the Government grant which did not permit any transfer of land by him without fulfilling the conditions prescribed in Clause 9. The conditions of grant though allowed sub-lease for agricultural purpose but sub-lessees cannot claim independent tenancy rights contrary to terms of grant. The terms and conditions of grant will have an overriding effect in view of amendment of Sections 2 & 3 of the Government Grants Act in its application to State of U.P. inserted by U.P. Amendment Act 13 of 1960 with retrospective effect.28. The aforesaid provisions as applicable in the State of U.P. with retrospective effect clearly provides that the rights and obligations between the Government as lessor of the land and the grantee as lessee of the land are to be regulated by the terms of the grant. The terms of the grant clearly postulates transfer of the land by Government Lessee subject to fulfillment of certain conditions. A sub-lease created for agricultural purposes having been exempted from operation of the conditions and no vested right shall be created in sublease and he cannot claim any rights contrary to the terms of the grant.29. Similar issue came up for consideration before this Court in the case of Escorts Farms Ltd., Previously Known As M/S. Escorts Farms (Ramgarh) Ltd. Vs. The Commissioner, Kumaon Division, Nainital, U.P. And Ors. (2004) 4 SCC 281 ,  and has been answered as under :-33. The Statement of Objects and Reasons for amending Section 2 of the Govt. Grants Act, 1895 by UP Amendment Act of 1960 makes it clear that the State Legislature intended to apply only the provisions of Land Reforms Act and Ceiling Act to the lands held by persons under the Govt. Grants Act. The statements of objects and reasons read thus:-Provisions of Section 2 of the Government Grants (UP Amendment) Act, 1959, have the effect of saving a grant of an agricultural lease by or on behalf of the Government from the operation not only on the Acts mentioned therein, but also of any other law, including the law for imposition of ceiling on land holdings, that might be made in future. There is also an apprehension that the result of the wordings of section 2 may be to undo the vesting of estates of government grantees under section 4 of the UP Zamindari Abolition and Land Reforms Act, 1950. With a view, therefore, to remove any such apprehension and to put the UP Imposition of Ceiling on Land Holdings Bill, 1959, when enacted, beyond the purview of the Government Grants Acts, this Bill is being introduced. Vide UP Gazette Extraordinary, dated February 3, 1960.34. Land Reforms Act, 1950 being saved by sub-section (3) of Section 2 of Govt. Grants Act is applicable to the govt. grants. Under Section 18 (l)(c) of Land Reforms Act, a govt. grantee holding land rent-free was allowed to retain possession of the land as Bhumidhar. Section 18 of the Land Reforms Act with clause (c) in sub-section (1) reads thus:-Section 18. Settlement of certain lands with intermediaries or cultivators as Bhumidar - (1) Subject to the provisions of Sections 10,15,16 and 17, all lands - (a) in possession of or held or deemed to be held by an intermediary as sir, khudkasht or an intermediary grove. (b) held as a grove by, or in the personal cultivation of a permanent lessee in Avadh. (c) held by a fixed-rate tenant or a rent-free grantee as such, or (d) held as such by - i) an occupancy tenant, Possessing the ii) a hereditary tenant, right to transfer iii) a tenant on Patta the holding by sale Dawami or Istamrari referred to in Section 17, (e) held by a grove holder.On the dale immediately preceding the date of vesting shall be deemed to be sell led by the State Government with such intermediary, [lessee, tenant, grantee or grove-holder] as the case may be, who shall, subject to the provisions of this Act. be entitled to take or retain possession as a bhumidhar thereof.35. As seen above, proviso below sub-section (3) of Section 2, of Govt. Grants (UP Amendment) Act makes applicable Ceiling Act to the land held by a grantee under the Govt. Grant. It has already been noted that a Govt. Grantee or a lessee is covered within the definition of tenure holder given in under clause (17) read with clause (9) of Ceiling Act and the definition of person in Section 4 (33) of the UP General Clauses Act. Thus conjointly reading the provisions of the Ceiling Act and the Land Reforms Act, the grantee of land from the government is a holder of land in the status of a Bhumidhar and the land can be subjected to ceiling limit. To the lands held by the company, which is grantee of the Govt., the provisions of Ceiling Act would be attracted. Such grantee being a lessee from Government has no right to transfer the land without permission of the Government. It can grant leases or sub-leases under the UP Tenancy Act but the lessees/sub-lessees can claim no rights contrary to the terms of the grant. All the transfers made by the Company or Farm by sale or lease contrary to the terms of the Govt. Grant create no independent rights in favour of the said transferees or lessees. The claims of transferees and lessees based on the provisions of UP Tenancy Act were, therefore, rightly negatived by the ceiling authority and the High Court.30. We may also reproduce the observations made in paragraph 32 of the Escorts Farms Ltd. (Supra) :-32. No action of the revenue authorities can, therefore, estop the ceiling authorities from ignoring the claims of tenancy rights on the land set up by the lessees/sub-lessees. The rights between the government and the grantee are strictly to be regulated by the terms of the grant and in accordance with the Govt. Grants (UP Amendment) Act, 1960. The entries in revenue records and recognition of any tenancy rights of the lessee and/or sub-lessee as hereditary tenant, Sirdars or Bhumidhars under the UP Tenancy Act can have no adverse legal effect on the Govt. Grant which has an overriding effect under the Govt. Grants Act. No estoppel can operate against the overriding statute so as to bind the ceiling authorities to accept the tenancy rights of the lessees/sub-lessees as indefeasible in application of Ceiling Act to the lands in question.31. From the aforesaid discussions, it is clear that the provisions of Ceiling Act would be applicable in case of grantee of Government under a lease agreement. The grantee being a lessee from the Government has no right to transfer the land without fulfilling the conditions stipulated in Clause 9 of lease deed. The terms of the lease deed though provide for sub-lease for agricultural purposes but sub-lessees can claim no independent rights as a tenure holder.32. Thus, the appellant being a sub-lessee continues to be an ostensible holder of land and the government grantee, the Respondent No. 2, to be the real holder and the ceiling authorities as well as the High Court have rightly dismissed the claim of the appellant.