Case: Bhanwar Lal And Anr Vs. Regional Settlement Commissioner, Jaipur, Cum-Custodian

in 1931, that the mortgagees had been in possession of the property, that they did not get any notice of the proceedings taken by the Assistant Custodian and were informed of his order in 1959 by their tenants in the land in suit when the allottees of the land were taking steps to recover possession. The writ petition was dismissed by the High Court which held that the issue of notice to Hazari and Magha was sufficient compliance with the requirements of sub-section (1) of S. 7 of the Act as the custodian had not to make any preliminary enquiry about the persons who might be interested in the property of the alleged evacuee. It is against this order that Bhanwar Lal and Rati Ram have filed this appeal by special leave. 3. Section 7(1) of the Act reads:"Where the Custodian is of opinion that any property is evacuee property within the meaning of this Act, he may, after causing notice thereof to be given in such manner as may be prescribed to the persons interested, and after holding such inquiry into the matter as the circumstances of the case permit, pass an order declaring any such property to be evacuee property." The Custodian can form his opinion about any property having become evacuee property on the basis of information available to him. It has been so held in Abdul Hakim Khan v. Regional Settlement Commissioner, 1962-1 SCR 531 : (AIR 1961 SC 1391 ). He can issue notice to the persons interested also on the basis of information available to him. He is not expected to hold a general inquiry of the persons interested in the alleged evacuee property. In the present case it appears that the village records about the land in suit which is agricultural, recorded the names of Hazari and Magha as mortgages and that the Assistant Custodian could consider them to be the persons interested. He could have had no information whether these mortgagees who resided at some other place were alive or not. He complied with the requirements of sub-section (1) of S. 7 to give a notice to Hazari and Magha. The notice however was ineffective and not good as Hazari and Magha had died long before. The question then arises whether the further proceedings on the basis of this notice could affect the interests of the mortgagees. 4. The interest of Ibrahim and others, the evacuees of the property in suit which was under mortgage, consisted of the equity of redemption in the property. It is this interest of theirs which could be declared evacuee property and the order of the Assistant Custodian dated April 7, 1955, declaring the aforesaid property to be evacuee property, really amounts to an order declaring the right of Ibrahim and others in the equity of redemption evacuee property. The order cannot affect the mortgagee rights as Ibrahim and others had no interest in the mortgagee rights. 5. It follows that the impugned order does not affect the rights of the appellants if any as mortgagees. The non-issue of the notice to the appellants therefore is of no consequence as the order subsequently passed without the issue of the notice to them does not affect their interest. 6. Reference in this connection may again be made to Abdul Hakim Khans Case, 1962-1 SCR 531 : (AIR 1961 SC 1391 ). In that case a number of persons had shares in certain property. Some of them migrated to Pakistan. The notice under S. 7 (1) was issued to one of those persons who had not migrated to Pakistan. The Custodian declared the property of those who had migrated to be evacuee property and specified their share in the property. The other co-shares except the one to whom the notice was issued, challenged the validity of the order passed under S. 11 of the Evacuee Interest (Separation ) Act, 1951 (Act LIV of 1951) vesting the entire property in the Custodian. This Court held that the objectors could not challenge the validity of the order under S. 7 of the Act as it did not affect their rights in the property. Similarly it can be said that the appellants in this case cannot challenge the validity of the proceedings on the notice issued by the Assistant Custodian and the order of the Assistant Custodian declaring the property in suit to be evacuee property when that order does not affect the mortgagee rights of the appellants. 7. By virtue of the order dated April 7, 1955, the rights of the evacuees in the property in suit vest in the Custodian and those rights, as stated earlier, consist of the rights of equity of redemption. This means that the Custodian holds the property subject to the mortgage rights, if any of the appellants. 8. It has been conceded by Mr. Prem appearing for the respondents, that no action has been taken under the Evacuee Interest (Separation) Act 1951. Section 10 of this Act empowers the competent officer to take all necessary measures for the purpose of separating the interest of the evacuees from those of the claimants in any composite property which inter alia means any property which or in which an interest has been declared to be evacuee property or has vested in the Custodian under the Act and in which the interest of the evacuee is subject to mortgage in any form in favour of a person not being an evacuee. It is only after such separation of the interests of the evacuee and the claimants in the composite property that the evacuee interest gets vested in the custodian free from all encumbrances. It follows that so long as proper action under the Evacuee Interest (Separation) Act is not taken to separate the interest of the evacuees and the appellants who claim to be mortgagees, the Custodian cannot take any action against the appellants or their tenants who are said to be in possession of the property in suit.

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

Explanation:
0[ds]4. The interest of Ibrahim and others, the evacuees of the property in suit which was under mortgage, consisted of the equity of redemption in the property. It is this interest of theirs which could be declared evacuee property and the order of the Assistant Custodian dated April 7, 1955, declaring the aforesaid property to be evacuee property, really amounts to an order declaring the right of Ibrahim and others in the equity of redemption evacuee property. The order cannot affect the mortgagee rights as Ibrahim and others had no interest in the mortgagee rights5. It follows that the impugned order does not affect the rights of the appellants if any as mortgagees. The non-issue of the notice to the appellants therefore is of no consequence as the order subsequently passed without the issue of the notice to them does not affect their interest6. Reference in this connection may again be made to Abdul Hakim Khans Case, 1962-1 SCR 531 : (AIR 1961 SC 1391 ). In that case a number of persons had shares in certain property. Some of them migrated to Pakistan. The notice under S. 7 (1) was issued to one of those persons who had not migrated to Pakistan. The Custodian declared the property of those who had migrated to be evacuee property and specified their share in the property. The other co-shares except the one to whom the notice was issued, challenged the validity of the order passed under S. 11 of the Evacuee Interest (Separation ) Act, 1951 (Act LIV of 1951) vesting the entire property in the Custodian. This Court held that the objectors could not challenge the validity of the order under S. 7 of the Act as it did not affect their rights in the property. Similarly it can be said that the appellants in this case cannot challenge the validity of the proceedings on the notice issued by the Assistant Custodian and the order of the Assistant Custodian declaring the property in suit to be evacuee property when that order does not affect the mortgagee rights of the appellants7. By virtue of the order dated April 7, 1955, the rights of the evacuees in the property in suit vest in the Custodian and those rights, as stated earlier, consist of the rights of equity of redemption. This means that the Custodian holds the property subject to the mortgage rights, if any of the appellants8. It has been conceded by Mr. Prem appearing for the respondents, that no action has been taken under the Evacuee Interest (Separation) Act 1951. Section 10 of this Act empowers the competent officer to take all necessary measures for the purpose of separating the interest of the evacuees from those of the claimants in any composite property which inter alia means any property which or in which an interest has been declared to be evacuee property or has vested in the Custodian under the Act and in which the interest of the evacuee is subject to mortgage in any form in favour of a person not being an evacuee. It is only after such separation of the interests of the evacuee and the claimants in the composite property that the evacuee interest gets vested in the custodian free from all encumbrances. It follows that so long as proper action under the Evacuee Interest (Separation) Act is not taken to separate the interest of the evacuees and the appellants who claim to be mortgagees, the Custodian cannot take any action against the appellants or their tenants who are said to be in possession of the property in suit.