Case: Gaurav Aseem Avtej Vs. U.P. State Sugar Corporation Ltd. and Ors

both ownership as well as possession. And in the context of the definition it is not possible to interpret the term held only in the sense of possession.The word "holds" was again interpreted in Hari Ram v. Babu Gokul Prasad [1991 Supp (2) SCC 608] where it occurs in Section 185(1) of the Madhya Pradesh Land Revenue Code, 1959. It was observed: (SCC p. 611, para 5)The word holds is not a word of Article It has not been defined in the Act. It has to be understood in its ordinary normal meaning. According to Oxford English Dictionary, it means, to possess, to be owner or holder or tenant of. The meaning indicates that possession must be backed with some right or title.12. Blacks Law Dictionary defines Hold as under:To possess in virtue of a lawful title; as in the expression, common in grants, "to have and to hold," or in that applied to notes, "the owner and holder."In the context of the 1971 Act, the word "held" connotes a wide meaning. All lands held or occupied lawfully and which were used for the purposes of the factory stood vested in the Government on the appointed day. The word held in Section 2(h)(vi) cannot be interpreted as limited only to a holding as an owner of the property. Legal possession is sufficient for the lands to vest in the Government by forming part of the scheduled undertaking.13. Blacks Law Dictionary defines occupy as under:To take or enter upon possession of; to hold possession of; to hold or keep for use; to possess; to tenant; to do business in; to take or hold possession. Actual use, possession, and cultivation. See occupancy; occupant; occupation; possession.The words held or occupied carry the same meaning and there is no manner of doubt that if the land is in the lawful possession of the factory and was being used for the purposes of the factory, the said land vested in the Government as per Section 3 of the 1971 Act. Section 3 of the 1971 Act provides for the vesting of the scheduled undertaking free from all encumbrances. There is no dispute that, in the instant case, the land was held and occupied by the sugar factory for a long period of time pursuant to a lease deed executed by the Plaintiffs and was being used for the purpose of the factory.14. The point that remains to be considered is about the reason for the insertion of the words "including any leasehold interest therein". The submission of the Appellant which found favour with the Trial Court and the First Appellate Court is that the vesting under the 1971 Act is only of the leasehold interest in the land. We disagree. We are of the opinion that all lands including those which are held pursuant to a lease vest in the State. It is only ex abundant cautela that these words are included in the definition clause. The intention of the legislature is made very clear in the definition of scheduled undertaking by insertion of the words "including any leasehold interest." The words including any leasehold interest cannot be read in the manner that is canvassed by the Appellant which is that vesting is only of leasehold interest. A plain reading of Section 2(h) (vi) of the 1971 Act provides that a scheduled undertaking would comprise of all lands and buildings held or occupied for the purpose of the factory. The word including would clearly indicate that the lands held by way of lease are also part of a scheduled undertaking. In any case the words "including any leasehold interest therein" cannot be understood to have a limiting effect and result in the acquisition of only the leasehold interest in the land.15. If the intention of the Legislature was to exclude leasehold lands it could have expressed the same by adding lands held on lease along with agricultural and grove lands. As per Section 2(h)(vi) all lands other than lands held or occupied for purpose of cultivation and grove lands are part of scheduled undertaking. In view of above, we are of the opinion that the land in dispute stood vested in the State Government on the appointed day i.e. 03.07.1971.16. The findings recorded above would have been sufficient to dispose of the controversy in this case. But it has become necessary for us to deal with the findings of the High Court that the Plaintiffs are not entitled for any compensation for their lands. The reason given by the High Court is that the lease executed by the Plaintiffs was contrary to Section 156 of the 1950 Act. And, the consequence of the violation of Section 156 is that the transaction is void and the Plaintiffs lost all rights in the property as per Section 167 of the Act.17. Undisputedly, the lease of the land was entered into between the parties prior to the 1950 Act coming into force. The Act of 1950 is not applicable to the land which was being used for non agricultural purposes prior to 1950. Land as defined in Section 3 (14) of the 1950 Act means land, held or occupied for purposes connected with agriculture, horticulture or animal husbandry. Moreover, there is also a declaration Under Section 143 of the 1950 Act that the land was being used for non agricultural purposes. The said order Under Section 143 passed by the SDO, Bijnor on 20.01.1972 was on the basis of a report submitted by the Tehsildar made on 17.12.1970. In view of the above, we are of the opinion that the land did not vest in the Government under the 1950 Act.18. We are not in agreement with the findings of the High Court regarding the vesting of the land in the Government under the 1950 Act due to which the Plaintiffs were held disentitled for any compensation. The land owners may resort to any remedy available to them for payment of compensation to which they are entitled to.

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

Explanation:
0[ds]It is relevant to mention at the outset that the pleadings in this case are not very clear. After a detailed scrutiny of the material on record, we refer to the undisputed facts which are as follows:i. The land in dispute admittedly belongs to the Plaintiffs. They leased out the said land to M/s. Shiv Prasad Banarasi Das Sugar Mills, Bijnor prior to 1950ii. The land was being used for the purpose of parking of vehicles which brought sugarcane to the factoryiii. The 1950 Act came into force on 26 January, 1951iv. The S.D.O., Bijnor by an order dated 20.01.1972 declared the land as non agricultural land Under Section 143 of the 1950 Act. The said order was passed on the basis of a report submitted by the Tehsildar on 17.12.1970v. The Plaintiffs were unsuccessful in their challenge to the 1971 Act. Though the Act was passed in 1971, the possession of the scheduled undertaking was handed over only in the year 1979 to the Governmentvi. A notice of termination of the lease was issued on 10.12.1979. The suit filed by the Plaintiffs was partly decreed by the trial Court on 14.04.1982 and fully decreed by the First Appellate Court on 01.08.1984vii. During the pendency of the second appeal in the High Court, the Plaintiffs executed a sale deed in favour of the present Appellant on 29.11.2004. Notice was issued in the SLP on 20.07.2007 and leave was granted by this Court on 05.10.20098. The point of vesting of the lands under the 1971 Act was adjudicated by all the three Courts below. We are of the opinion that determination of this issue will set at rest the controversy in this case. The Trial Court and the First Appellate Court held that the land did not vest in the Government under the 1971 Act and it was only the leasehold interest in the land that vested in the Government. Whereas, the High Court held that the land vested in the Government. We areunable to agree. A detailed examination of the provisions of the Act would make it clear that the intention was to secure all assets which were being used for the purposes of the factoryThere is no dispute that, in the instant case, the land was held and occupied by the sugar factory for a long period of time pursuant to a lease deed executed by the Plaintiffs and was being used for the purpose of the factory. We areof the opinion that all lands including those which are held pursuant to a lease vest in the State. It is only ex abundant cautela that these words are included in the definition clause. The intention of the legislature is made very clear in the definition of scheduled undertaking by insertion of the words "including any leasehold interest." The words including any leasehold interest cannot be read in the manner that is canvassed by the Appellant which is that vesting is only of leasehold interest. A plain reading of Section 2(h) (vi) of the 1971 Act provides that a scheduled undertaking would comprise of all lands and buildings held or occupied for the purpose of the factory. The word including would clearly indicate that the lands held by way of lease are also part of a scheduled undertaking. In any case the words "including any leasehold interest therein" cannot be understood to have a limiting effect and result in the acquisition of only the leasehold interest in the land15. If the intention of the Legislature was to exclude leasehold lands it could have expressed the same by adding lands held on lease along with agricultural and grove lands. As per Section 2(h)(vi) all lands other than lands held or occupied for purpose of cultivation and grove lands are part of scheduled undertaking. In view of above, we are of the opinion that the land in dispute stood vested in the State Government on the appointed day i.e. 03.07.197116. The findings recorded above would have been sufficient to dispose of the controversy in this case. But it has become necessary for us to deal with the findings of the High Court that the Plaintiffs are not entitled for any compensation for their lands. The reason given by the High Court is that the lease executed by the Plaintiffs was contrary to Section 156 of the 1950 Act. And, the consequence of the violation of Section 156 is that the transaction is void and the Plaintiffs lost all rights in the property as per Section 167 of the Act17. Undisputedly, the lease of the land was entered into between the parties prior to the 1950 Act coming into force. The Act of 1950 is not applicable to the land which was being used for non agricultural purposes prior to 1950. Land as defined in Section 3 (14) of the 1950 Act means land, held or occupied for purposes connected with agriculture, horticulture or animal husbandry. Moreover, there is also a declaration Under Section 143 of the 1950 Act that the land was being used for non agricultural purposes. The said order Under Section 143 passed by the SDO, Bijnor on 20.01.1972 was on the basis of a report submitted by the Tehsildar made on 17.12.1970. In view of the above, we are of the opinion that the land did not vest in the Government under the 1950 ActWe arenot in agreement with the findings of the High Court regarding the vesting of the land in the Government under the 1950 Act due to which the Plaintiffs were held disentitled for any compensation. The land owners may resort to any remedy available to them for payment of compensation to which they are entitled to.