Case: Pushpapriyadevi And Ors Vs. State Of Maharashtra And Anr

Madhya Pradesh After the passing of the Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1950, a notification was issued vesting the estate in the State and the appellant was prohibited from cutting timber in exercise of his rights under the contract. Later after some negotiations the appellant agreed to pay an additional sum of Rs. 17, 000 but reserved his right to claim a refund. The State Government rejected the appellants right to cut trees. The appellant thereafter lied a suit claiming specific performance of the contract on the ground that the forest and trees did not vest in the St-ate under the Act and even if they vested the standing timber having been sold to the appellant did not vest in the State and in any event a new contract was completed in February and the appellant was entitled to specific performance. This Court negatived all the pleas and held after considering the earlier decisions that it was too late in the day to contend that the forest and the trees did not vest in the State under the Act. Repelling the contention on behalf of the appellant that under the contract the plaintiff had become owner of the trees as goods, this Court observed that though the trees which were agreed to b e served before sale or under the contract of sale are goods for the purpose of Sale of Goods Act but before they cease to be proprietary rights or interest within the meaning of section 3 and 4(a) ol the Act, they must be felled under the contract. On the facts of the case the Court held that the property in cut timber would only pass to the appellant under the contract at the earliest when the trees were felled. It further added that, as the contract provided that the appellant was entitled to cut teak trees of more than 12" girth it would have to be ascertained which trees fell within the description and till that is ascertained they were not ascertained goods. Thus in order that the property in the goods passes under the Sale of Goods Act, it is necessary that the trees should be felled and ascertained before the relevant date. In the present case we agree with the conclusion arrived at by the High Court that the trees were not felled before 31st March, 1951 and further they were not ascertained as required under the contract for as pointed out the logs had to be checked and passed by State Forest staff by affixing the mark before they can be removed by the appellant. Thus the facts are similar and the decision in the case applies to the present case. Holding that the trees were not felled and that the goods were not ascertained, we find that the title in the goods had not passed to the appellant before 31st March, 1951, the date on which the estate vested in the State.When it is found that the title in the goods had not passed to the appellant, then the provisions of section 6(1) will be attracted and this being a transfer of right in property which is liable to vest in the State after 16th March, 1950, it shall be void from the date of vesting.10. We agree with the finding of the High Court that it is not possible to accept the appellants case that he paid Rs. 35, 000 to the second respondent. The appellant is the brother of the Zamindar, the second respondent. The appellant has not chosen to examine himself as a witness and speak to his payment of Rs. 3 5, 000 to the second respondent. On behalf of the appellant his agent was examined a s P.W. 1. According to him he paid in cash to the respondent a sum of Rs. 35, 000 on 30th September, 1951. The witness was questioned as to whether for making the payment he borrowed the money from second respondent himself. He denied any knowledge about such borrowing. It is most unlikely that any payment of Rs. 35, 000 was made on behalf of the appellant on 30th September, 1951. Without making sure that he would be able to remove timber contracted without any objection from the State, he would not have paid Rs. 35, 000. As pointed out by the High Court P.W. 3 does not state that he in fact received Rs. 35, 000 in cash. There is no material to show that the appellant had such an amount with him. In the correspondence that passed between the appellant and the Government, the appellant did not mention that he had already paid Rs. 35, 000 to the second respondent. In fact. when the Government demanded that he should pay Rs. 35, 000 the appellant paid the amount without any protest. Taking into account the fact that the appellant and the second respondent are brothers, the imminence of the vesting of the entire estate of the second respondent with the State, and the absence of any material to show that the appellant was possessed of the funds, we have no hesitation in agreeing with the finding of the High Court that the appellant would not have paid the amount to the second respondent.Lastly, it was contended that in any event as the Government permitted the appellant to remove the logs on payment of Rs. 35, 000 it should be construed as ratification of the contract entered into by the second respondent and as such the Government is not entitled to collect Rs. 35, 000 as if at all anyone was entitled to the amount it was only the second respondent. We have no hesitation in rejecting this argument for after the vesting of the forest in the Government, the Government under section 6(2) offered to permit the appellant to remove the trees on payment of Rs. 35, 000. Having agreed to the condition and paid Rs. 35, 000 the appellant cannot ask for any refund.11.

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

Explanation:
0[ds]To, determine the question as to whether the transaction between the, plaintiff and the second respondent was complete before 31st March, 1951 it is useful to refer to the contract entered into between the parties. Ex. P-19 is the contract and is dated 15th March, 1951. The agreement is designated as Forest Contract and provided that the agreement is for the sale and purchase of forest produce and that it was agreed between the parties in the followingForest Produce sold and purchased under this agreement is the followingUn-Marked (Teak &Miscellaneous) Standing/cut/with fallen trees, situated in the coupe known as Teak trees coupe in the near Hachbodi-Nendwadi Forest Range in the Aheri Estate:-Teak 1000 Teak trees over 4 in girth near Hachbodi-Nendwadi at Rs. 501/-per tree sanctioned by Z. S. Ahiri on 14-3-1951. Clause 3 provided that the contract shall commence on 15th March, 1951 and will be in force up to 14th March, 1953 after which date the contractor will have no right to any material not removed from the contract area. The contractor agreed to remove the forest produce only during the above period. Clause 4 provided that the consideration payable by the contractor for this contract is Rs. 50, 000 and that the amount will be duly paid by the contractor by crediting it in the Ahiri Estate Treasury in installments of Rs. 15, 000 on 15th day of April and Rs. 35, 000 on 15th day of September. Clause 5 of the contract is important any may be extracted inThe contractor will not remove any forest produce from the site of the x (x torn) and until the logs are checked and passed by the Estate Forest Staff by affixing x (x torn) bed pas sing hammer. The contractor will not remove any forest produce between the sunset and sunrise. The contractor will make his own arrangements for stacking x (x torn) outside the contract area7 provided that the contractor will duly coppice the stumps of the trees felled by him. He agreed to carry out all his operations properly, according to the rules in force governing the forest area and in a workman-like manner and further agreed to abide by any directions and instructions in regard to the working of this contract that may be issued to him by the Estate Forest Staff and other estate authorities. Clause 8 provided that in the event of the contractors failure to pay any of the installments within the time fixed, the estate authorities will be entitled to stop and restrain all further extraction or other work in the contract area. Clause 9 provided that the contractor agrees to file every month accounts of the felling, logging and extraction done byclauses above extracted clearly show that the contract was to commence on 15th March, 1951 and be in force till 14th March, 1953 during which period the contractor agreed to file monthly a ccounts of felling, logging and extraction by him. Clause 5 also provided that the contractor will not remove any forest produce till the logs are checked and passed by the State Forest staff. The second installment of Rs. 35, 000 is to be paid on 15th September, 1951. These clauses make it very clear that what was contracted for was the sale of forest produce which is a proprietary right vested in the proprietor in the property which according to the Act is to vest in the State. The plea on behalf of the plaintiff that the contract was only for the sale of goods i.e. movable property and that as the trees had been marked and felled before 31st March the contract of sale of goods bad been concluded cannot be accepted. Apart from the fact that the contract was clearly not for sale of goods but for transfer of right in property, the facts also do hot support the plea of the plaintiff that the trees were marked and felled before 31st March, 1951. The evidence of P.W. 1 is that the marking and cutting was done at the same time simultaneously and that the plaintiff bad cut all the trees in the disputed contract. According to P.W. 2 the trees were being cut as they were marked. The trial court held that the title of the plaintiff to the trees was complete before 31st March, 1951 but the High Court came to the conclusion that there is no evidence to , how that the trees were cut before the date of vesting. The High Court may not be quite correct in stating that there is no evidence to show that the trees were cut before the date of vesting but there can be no doubt that the evidence cannot be accepted for it is impossible to have cut the trees before 31st March, 1951.Even assuming that the trees were cut the property will not pass to the plaintiff till requirements of clause 5 of the contract are complied with i.e. the logs have been checked and passed by the State Forest Officer by affixing marks and delivered to the plaintiff. This was admittedly not done. Before the logs are checked and passed the goods are not ascertained and the title cannot pass to thehave no hesitation in coming to the conclusion that the trees were not in fact cut before 31st March, much less the cut trees ascertained before 31st March,decision of this Court in Badri Prasad v. State of Madhya Pradesh &Anr.([1969] 2 S.C.R. 380.) was relied on by both the appellants and the respondents. The facts are similar and arise out of a forest contract in Madhya Pradesh and the case raised similar questions. The facts of the case briefly are that the appellant before this Court entered into a contract for removing forest produce in Madhya Pradesh After the passing of the Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1950, a notification was issued vesting the estate in the State and the appellant was prohibited from cutting timber in exercise of his rights under the contract. Later after some negotiations the appellant agreed to pay an additional sum of Rs. 17, 000 but reserved his right to claim a refund. The State Government rejected the appellants right to cut trees. The appellant thereafter lied a suit claiming specific performance of the contract on the ground that the forest and trees did not vest in the St-ate under the Act and even if they vested the standing timber having been sold to the appellant did not vest in the State and in any event a new contract was completed in February and the appellant was entitled to specific performance. This Court negatived all the pleas and held after considering the earlier decisions that it was too late in the day to contend that the forest and the trees did not vest in the State under the Act. Repelling the contention on behalf of the appellant that under the contract the plaintiff had become owner of the trees as goods, this Court observed that though the trees which were agreed to b e served before sale or under the contract of sale are goods for the purpose of Sale of Goods Act but before they cease to be proprietary rights or interest within the meaning of section 3 and 4(a) ol the Act, they must be felled under the contract. On the facts of the case the Court held that the property in cut timber would only pass to the appellant under the contract at the earliest when the trees were felled. It further added that, as the contract provided that the appellant was entitled to cut teak trees of more than 12" girth it would have to be ascertained which trees fell within the description and till that is ascertained they were not ascertained goods. Thus in order that the property in the goods passes under the Sale of Goods Act, it is necessary that the trees should be felled and ascertained before the relevant date. In the present case we agree with the conclusion arrived at by the High Court that the trees were not felled before 31st March, 1951 and further they were not ascertained as required under the contract for as pointed out the logs had to be checked and passed by State Forest staff by affixing the mark before they can be removed by the appellant. Thus the facts are similar and the decision in the case applies to the present case. Holding that the trees were not felled and that the goods were not ascertained, we find that the title in the goods had not passed to the appellant before 31st March, 1951, the date on which the estate vested in the State.When it is found that the title in the goods had not passed to the appellant, then the provisions of section 6(1) will be attracted and this being a transfer of right in property which is liable to vest in the State after 16th March, 1950, it shall be void from the date ofagree with the finding of the High Court that it is not possible to accept the appellants case that he paid Rs. 35, 000 to the second respondent. The appellant is the brother of the Zamindar, the second respondent. The appellant has not chosen to examine himself as a witness and speak to his payment of Rs. 3 5, 000 to the second respondent. On behalf of the appellant his agent was examined a s P.W. 1. According to him he paid in cash to the respondent a sum of Rs. 35, 000 on 30th September, 1951. The witness was questioned as to whether for making the payment he borrowed the money from second respondent himself. He denied any knowledge about such borrowing. It is most unlikely that any payment of Rs. 35, 000 was made on behalf of the appellant on 30th September, 1951. Without making sure that he would be able to remove timber contracted without any objection from the State, he would not have paid Rs. 35, 000. As pointed out by the High Court P.W. 3 does not state that he in fact received Rs. 35, 000 in cash. There is no material to show that the appellant had such an amount with him. In the correspondence that passed between the appellant and the Government, the appellant did not mention that he had already paid Rs. 35, 000 to the second respondent. In fact. when the Government demanded that he should pay Rs. 35, 000 the appellant paid the amount without any protest. Taking into account the fact that the appellant and the second respondent are brothers, the imminence of the vesting of the entire estate of the second respondent with the State, and the absence of any material to show that the appellant was possessed of the funds, we have no hesitation in agreeing with the finding of the High Court that the appellant would not have paid the amount to the second respondent.Lastly, it was contended that in any event as the Government permitted the appellant to remove the logs on payment of Rs. 35, 000 it should be construed as ratification of the contract entered into by the second respondent and as such the Government is not entitled to collect Rs. 35, 000 as if at all anyone was entitled to the amount it was only the second respondent. We have no hesitation in rejecting this argument for after the vesting of the forest in the Government, the Government under section 6(2) offered to permit the appellant to remove the trees on payment of Rs. 35, 000. Having agreed to the condition and paid Rs. 35, 000 the appellant cannot ask for any refund.