Case: Voltas Limited Vs. Tehsildar, Thane &amp; Others

and from the commencement of the Act "no person shall be entitled to hold any vacant land in excess of the ceiling limit in the territories to which the Act applies". It is, therefore, open to the authorities to specify a date from which the excess land shall be deemed to have been vested free from encumbrances in the State. But it is not that in all cases it is the date of operation of the Act i.e. February 17, 1976 which divests the owner over his land. 22.This is also clear from sections 20 and 21 of the Act which provide for exemption from operation of the Act in certain cases. This legal position becomes clear from the decision of the Supreme Court in Smt.Darothi Clare Parreira and others vs. State of Maharashtra and Ors. AIR 1996 SC 2553 , wherein the relevant date for vesting in the State was held to be 12th March, 1979. In paragraph 5, the Court observed;"Having considered the respective contentions, the question that arises for consideration is :whether publication of the notification under Section 10(3) of the Act in the Gazette is in accordance with law No doubt, this question was not squarely put in issue before the High Court in the manner in which Shri Naik and Shri Bobde have posed before us. Having considered the scheme of the Act, we find that there is no force in their contentions. It is true that Section 3 postulates that except as otherwise provided in the Act, on and from the commencement of the Act, no person shall be entitled to hold any vacant land in excess of the ceiling limit in the territories to which the Act applies under sub-section (2) of Section 3. Sections 6 to 10 prescribe the procedure for determination of the excess urban land. Admittedly after filing of statement, opportunity had been given, they had been heard and excess land over the ceiling limit had been determined. Pursuant to the decision taken under Section 10(1) of the Act, objections came to be filed under Section 10(2) and objections also were considered and an opportunity was given before their consideration and objections came to be rejected. The question then is : whether the competent authority has to await the decision under Sections 20 and 21 before declaring and publishing the excess land under Section 10(3) by a notification in the Gazette. The scheme of the Act does indicate that until the date of the publication in the Gazette prescribing a date on and from which the excess land stands vested in the State, the owner continues to be the owner of the excess land and entitled to remain in possession thereof. On publication of the notification under Section 10(3) and after putting a date from which the land stands vested in the State and after publication of the notification in the gazette and on and from the date mentioned therein, the excess vacant land stands vested in the State free from all encumbrances, subject to the decision in appeal, if any, filed according to law." (emphasis supplied)23.In Special Officer & Competent Authority, Urban Land Ceilings, Hyderabad and Anr. vs. P.S.Rao (2000) 2 SCC 451 also, a similar view was taken by the Supreme Court. In paragraph 9 the Court observed;"But, the word "hold" in Section 20(1)(a) or Section 20(1)(b) cannot, in our opinion, have the same meaning that can be attributed to it as in Section 2(1). The very definition in Section 2(1) states that the sub-section applies unless there is anything in the context which suggests a different meaning to be given. In our view, in the context of Section 20(1)(a) and Section 20(1)(b), the definition given in Section 2 (l) cannot be applied. The reason is that such a construction will make Section 20 unworkable and otiose. We have pointed out above that it is not possible to make any meaningful application for exemption under Section 20(1)(a) or (b) unless the exact quantum of excess is determined under Section 10 after following the various provisions of the Act relating to statutory deductions and mode of computation. If the contention of the State referred to above is to be accepted, then the peculiar position will be as follows: as stated by us, before the excess is determined, a person will not be able to seek exemption because he does not know what is the actual excess land held and once the excess is determined, he cannot apply because he is not holding the excess land. Thus, the entire object of Section will be frustrated. That is why we say that the definition of the words "to hold" in Section 2(1) cannot be applied in the context of Section 20(1)(a) or Section 20(1)(b)."24.From the above decisions, to us, it is clear that the conditions imposed on the Company when the land was acquired by the Government under the provisions of the Land Acquisition Act and was given to the petitioner on certain terms and conditions and Sanad was issued in favour of the Company by laying down terms and conditions of use of the land operated and the company was bound by those conditions. When there was breach of conditions, it was open to the respondents to take appropriate proceedings in accordance with law including recovery of unearned profit in accordance with Government policy. The action, therefore, cannot be held to be objectionable in principle and the grievance of the petitioner is not justified.25.So far as the quantum is concerned, it was stated in the affidavit in reply that the respondents have no objection if the matter is remanded to the Collector, Thane, by directing him to pass appropriate order in accordance with law after affording hearing to the petitioner. The learned Advocate General also stated that the appropriate course is to set aside that part of the order by issuing direction to the Collector to pass fresh order. To that extent, therefore, the grievance of the petitioner is justified.

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

Explanation:
1[ds]18.So far as the main grievance of the petitioner that no action could have been taken against the petitioner on the terms and conditions of Sanad and breach thereof in view of passing of the Urban Land Ceiling Act, exemption granted under the Act, is notand cannot be upheld. As is clear, land has been granted by the Government to the Company under the Land Acquisition Act for a particular purpose. The land was granted to the petitioner Company on those conditions. A Sanad was issued wherein those conditions have been specified. The learned Advocate General is, therefore, in our opinion, right in submitting that the petitioner company wasoccupant. Section 29 of the Maharashtra Land Revenue Code, 1966, recognises certain class of persons as occupants. Occupants of Class I hold unalienated land in perpetuity and without any restrictions on the right of transfer. Occupants of Class II, however, hold unalienated land in perpetuity, but subject to the restrictions on the right to transfer. In the instant case, possession of the land was given to the petitioner Company by the Government for a particular purpose. Several conditions were, therefore, imposed in the Sanad and the Company was bound to comply with those conditions. In our opinion, it was not open to the Company to ignore those conditions. Passing of an order of exemption under the Ceiling Act would not wipe out conditions of Sanad. It was, therefore, open to theto direct the Company to act in accordance with the terms and conditions of Sanad. When the petitioner has not observed those conditions and committed breach thereof by disposing the property, it was open to the respondents to demand unearned income in accordance with the policy of the Government.19.We are also not impressed by the argument that in view of the provisions of the Ceiling Act, terms and conditions imposed in Sanad would notare not impressed by the argument of the learned counsel for the petitioner. Section 10(3) enacts that the excess land referred to in the notification underof the said Section will be vested in the Government "with effect from such date as may be specified in the declaration". Thus, it is the date which is specified in the notification that is material and with effect from that date the land will get vested in the Government. To us, it is clear that in view of the provisions of Section 3 of the Act which declares that except as otherwise provided in the Act, on and from the commencement of the Act "no person shall be entitled to hold any vacant land in excess of the ceiling limit in the territories to which the Act applies". It is, therefore, open to the authorities to specify a date from which the excess land shall be deemed to have been vested free from encumbrances in the State. But it is not that in all cases it is the date of operation of the Act i.e. February 17, 1976 which divests the owner over hisis also clear from sections 20 and 21 of the Act which provide for exemption from operation of the Act in certain cases. This legal position becomes clear from the decision of the Supreme Court in Smt.Darothi Clare Parreira and others vs. State of Maharashtra and Ors. AIR 1996 SC 2553  , wherein the relevant date for vesting in the State was held to be 12th March,the above decisions, to us, it is clear that the conditions imposed on the Company when the land was acquired by the Government under the provisions of the Land Acquisition Act and was given to the petitioner on certain terms and conditions and Sanad was issued in favour of the Company by laying down terms and conditions of use of the land operated and the company was bound by those conditions. When there was breach of conditions, it was open to the respondents to take appropriate proceedings in accordance with law including recovery of unearned profit in accordance with Government policy. The action, therefore, cannot be held to be objectionable in principle and the grievance of the petitioner is not justified.25.So far as the quantum is concerned, it was stated in the affidavit in reply that the respondents have no objection if the matter is remanded to the Collector, Thane, by directing him to pass appropriate order in accordance with law after affording hearing to the petitioner. The learned Advocate General also stated that the appropriate course is to set aside that part of the order by issuing direction to the Collector to pass fresh order. To that extent, therefore, the grievance of the petitioner is justified.