B. BAL REDDY versus TEEGALA NARAYANA REDDY & ORS.
[2016] 4 S.C.R. 62, Supreme Court of India, 2016
Outcome: Dismissed (Dismissed)
Segment: Ratio
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[2016) 4 S.C.R. 62 
B. BAL REDDY 
v. 
TEEGALA NARAYANA REDDY & ORS. 
(Civil Appeal No. 7998of2016) 
AUGUST 12, 2016 
[T. S. THAKUR, CJI, R. BANUMATHI 
AND UDAY UMESH LALIT, JJ.] 
Hyderabad Tenancy and Agricultural Lands Act, 1960 - s.38-
D - Alienation of tenanted land to third parties - Held: In view of 
s.38-D of the Act, the land must first be offered to the Protected 
Tenant and only when the Protected Tenant does not exercise the 
right of purchase, can the land holder sell the land to any other 
person - Transactions entered without following the procedure in 
s.J8-D are without legal effect - In absence of valid termination of 
protected tenancy, the interest of Protected Tenant continue to be 
operative and dev.olves on his legal heirs who can then claim 
restoration of possession - Mere loss of possession by itself would 
not terminate 'protected tenancy' - Land laws -Agricultural Tenancy. 
Dismissing the appeals, the Court 
HELD: 1. Section 38-D of the Act prescribes the procedure 
to be followed when land holder intends to sell the land held by a 
Protected Tenant. Accordingly the land must first be offered by 
issuing a notice in writing to the Protected Tenant and it is only 
when the Protected Tenant does not exercise the right of purchase 
in accordance with the procedure, that the land holder can sell 
such land to any other person. [Para 10] [[66-F-G] 
Kotaiah i' Property Assn of Baptist Churches (Pvt.) Ltd 
1989 (3) SCR 472 : (1989)
3 SCC 424 - relied on. 
2.1. It is not the case of appellants that alienations effected 
by the landholders were in conformity with aforesaid provision. 
The appellate authority was therefore right in holding that the 
appellants had no locus standi. It, however, erred in considering 
the merits of the matter despite having rendered such a finding 
on the issue of locus standi. Thus, all transactions entered into 
without following the procedure prescribed in Section 38-D of 
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the Act were without any legal effect. [Para 11) [67-C) 
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Sada v. Tehsildar AIR (1988) AP 77 - approved. 
Roddam Narsimha v. Hasan Ali Khan (2007) 11 SCC 
410 - referred to. 
2.2. It is well settled that the interest of a Protected Tenant 
continues to be operative and subsisting so long as 'protected 
tenancy' is not validly terminated. Even if such Protected Tenant 
has lost possession of the land in question, that by itself does not 
terminate the 'protected tenancy'. It is not the case of appellants 
that the Protected Tenancy was terminated in a manner known 
to law. In the absence of such valid termination of 'protected 
tenancy', the interest of such Protected Tenant continued to be 
operative and subsisting in law and could devolve on his legal 
heirs and representatives who could then claim restoration of 
possession. Even if the Protected Tenant had lost possession, 
without there being valid termination of his status as a Protected 
Tenant, he would still be entitled to all incidents of protection 
under the Act. The view taken by the High Court in allowing 
Revision Petitions in favour of respondents herein was perfectly 
right and justified. [Paras 12 and 13) [67-D-E; 68-D-EJ 
Case Law Reference 
1989 (3) SCR 472 
AIR (1988) AP 77 
(2007) 11 sec 410 
relied on 
approved 
referred to 
Para 10 
Paras 8, 12 
Para 12 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 7998 
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From the Judgment and
Order dated 06.08.2010 of the High Court 
of Judicature, Andhra Pradesh at Hyderabad in Civil Revision Petition 
No. 4904 of2006 
WITH 
C. A. Nos. 7996 and 7997 of 2016. 
Dushyant A. Dave, Sr. Adv., S. Udaya Kumar Sagar, Ms. Bina 
Madhavan, Ms. Praseena Elizabeth Joseph (For Mis. Lawyer S. Knit 
& Co.), Ad vs. for the Appellant. 
Jaideep Gupta, Sr. Adv., D. Mahesh Babu, Ms. Suchitra 
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SUPREME COURT REPORTS 
[2016] 4 S.C.R. 
Hrangkhwal, Y. Krishna Mohan Rao, Advs. for the Respondents. 
The Judgment of the Court was delivered by 
UDAY UMESH LALIT, J. I. Leave granted. These appeals 
challenge the judgment and order dated 06.08.20 I 0 passed by the High 
Court of Judicature at Andhra Pradesh at Hyderabad in Civil Revision 
Petition No.4904/2006 and in Civil Revision Petition Nos.447 of2007 
and 448 of 2007 which were disposed of on the same date in terms of 
the judgment and order in Civil Revision Petition No.4904 of2006. Since 
the High Court had considered Civil Revision Petition No.4904 of2006 
as the lead matter, the appeal arising therefrom is also taken as the lead 
matter by us. 
2. One Teegala Shivaiah was a Protected Tenant in respect of 
agricultural lands bearing Survey No.359( old) corresponding to Survey 
No.121 (new) situated at Koheda Village (hereinafter referred to as the 
said land). Wasool Baqui as regards the said land for the year 1954 and 
certificate under Sections 35 and 37 of the Hyderabad Tenancy and 
Agricultural Lands Act, 1950 (hereinafter referred to as the "Act") record 
the name ofTeegala Shivaiah as Protected Tenant. The fact that said 
Teegala Shivaiah was a Protected Tenant is not disputed. The 
respondents are the heirs and successors of said Teegala Shivaiah who 
died sometime in the year 1964. 
3. The land holders who were recorded owners of the said land 
sold the said land to various buyers who in
turn further effected sales 
and now appellants claim to be having ownership rights in respect of the 
said land. Various sale deeds are produced on record to prove the chain 
of transfers which are not being gone into presently and we proceed on 
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the footing that those deeds in respect of the said land are in favour of 
the appellants. 
4. Though the Protected Tenant had died sometime in 1964, the 
respondents moved an application under Section 40 of the Act before 
the Deputy Collector and Mandal Revenue Officer in the year 2001 
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praying for grant of Succession Certificate in their favour. The notices 
were thereafter issued to interested persons and the Deputy Collector 
and Mandal Revenue Officer, Hayathnagar Mandal Ranga Reddy District 
by his order dated 27.04.2004 granted Succession Certificate in respect 
of the said land in favour of the respondents. 
H
B. BAL REDDY v. TEEGALA NARAYANA REDDY 
[UDAY UMESH LAUT, J.] 
5. Soon thereafter the respondents filed an application under 
Section 32 of the Act for restoration of possession of the said land. 
Notices were issued to the appellants and in proceedings initiated 
thereafter the Deputy Collector Manda! Revenue Officer, Hyatlmagar 
Manda! Ranga Reddy District by his order dated 13.07.2004 directed 
restoration of the said land and that the physical possession be handed 
over to the respondents. Pursuantto the aforesaid order dated 13.07 .2004, 
possession was restored in favour of the respondents on 30.08.2004. 
6. The appellants preferred appeals challenging the aforesaid 
orders dated 27.04.2004 and 13.07.2004. By a common order dated 
22.07.2006, the Joint Collector-II, Ranga Reddy District allowed these 
appeals. As regard the locus standi of the appellants to challenge the 
aforesaid orders, it was held that the appellants were neither the original 
land holders nor the Protected Tenants and as such had no locus standi 
in the matter. Even after recording such finding, the Joint Collector-II 
Ranga Reddy District proceeded to consider merits of the matter. It 
was observed that though Teegala Shivaiah was the Protected Tenant in 
respect of the said land, the proceedings granting succession in favour 
of the respondents were not sustainable as there was no evidence about 
subsistence of protected tenancy as on the date when the Protected 
Tenant died and that since long
time had elapsed since his demise, 
succession could not be determined. It was also held that Manda! Revenue 
Officer was not competent to recognize succession to tenancy. 
7. The respondents preferred Civil Revision Petition No.4910 of 
2006 in the High Court of Judicature, Andhra Pradesh at Hyderabad 
against the aforesaid order dated 22.07.2006 setting aside the order of 
Manda! Revenue Officer dated 27.04.2004 granting-succession 
certificate. Said Revision Petition was dismissed by the High Court on 
08.12.2006 at the admission stage by passing following order:-
"There is no dispute nor denial that under Section 40 of the 
Andhra Pradesh (TelanganaArea) Tenancy & Agricultural Lands 
Act, 1950, (the Act, for brevity), the jurisdictional Manda! Revenue 
Officer cannot grant succession to the persons claiming to be the 
lineal descendants to a protected tenant, In that view of the matter, 
9rder of the Joint Collector dated 22/07/2006 impugned in this 
Civil Revision Petition in so far it relates to setting aside the order 
of the Manda! Revenue Officer 27/07/2004 passed under Section 
40 of the Act does not warrant any interference. 
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SUPREME COURT REPORTS 
[2016) 4 S.C.R. 
The Civil Revision Petition is accordingly dismissed. No costs" 
8. The respondents had also preferred Civil Revision Petition 
No.4904 of 2006 against the order dated 22.07.2006 by which order 
granting restoration was set aside. This Revision Petition was allowed 
by the High Court vide its judgment and order under appeal. The High 
Court observed that transaction of sale by the original land holders in 
favour of third parties of agricultural land under the holding ofa Protected 
Tenant was contrary to provision~ of Section 3 8-D of the Act and as 
such the appellate authority had rightly found that the present appellants 
had no locus standi in the matter. It was further observed that there was 
no evidence to show that the Protected Tenant had ever surrendered his 
protected tenancy or that he was evicted under Section 19 of the Act 
and as such the protected tenancy would continue despite the death of 
Protected Tenant and the rights in that behalf devolved on the successors. 
Relying on the decision of the Full Bench of Andhra Pradesh High Court 
in Sada v. Tehsildar1 it was held that no limitation or adverse possession 
could be raised against the protected tenancy. It was further observed 
that the respondents being legal heirs and lineal blood descendants of 
the Protected Tenant, they were entitled to seek restoration of possession. 
With this view, the High Court allowed Civil Revision Petition
No.4904 
of2006 and restored the order dated 13.07.2004. Similar orders were 
passed restoring orders granting possession in respect of Civil Revision 
Petition Nos.447 of2007 and 448 of2007. 
9. The appellants being aggrieved have preferred these appeals 
by special leave. We heard Mr. Dushyant A. Dave, learned Senior 
Advocate in support of the appeal and Mr. Jaideep Gupta, learned Senior 
Advocate for the respondents. 
10. Section 3 8-D of the Act prescribes the procedure to be followed 
when land holder intends to sell the land held by a Protected Tenant. 
Accordingly the land must first be offered by issuing a notice in writing 
to the Protected Tenant and it is only when the Protected Tenant does 
not exercise the right of purchase in accordance with the procedure, 
that the land holder can sell such land to any other person. The effect of 
this provision and non-compliance thereof was considered by this Court 
in Kotaiall v. Property Assn of Baptist Clturcltes (PVT.) LTD2• 
and 
it was laid down:-
1 AIR (1988) AP 77=1987 (2) ALT 749 (FB) 
'(1989) 3 sec 424
B. BAL REDDY v. TEEGALA NARAYANA REDDY 
[UDAY UMESH LAUT, J.] 
"(iv) Section 38-D prohibits the landholder from alienating the 
tenanted land to third parties. lfthe landholder intends to sell the 
land, he must give notice in writing of his intention to the protected 
tenant. The first offer must be given to the protected tenant. It is 
only when the protected tenant does not exercise the right to 
purchase, the landholder could sell the land to third parties. The 
alienation made in contravention of these provisions has no legal 
effect." 
11. It is not the case of the appellants that alienations effected by 
the landholders were in confonnity with aforesaid provision. The appellate 
authority was therefore right in holding that the present appellants had 
no locus standi. It, however, erred in considering the merits of the matter 
despite having rendered such a finding on the issue of locus standi. In 
our view all transactions entered into without following the procedure 
prescribed in Section 38-D of the Act are without any legal effect as 
held in Kotaiah's case (supra). 
12. It is well settled that the interest of a Protected Tenant continues 
to be operative and subsisting so long as 'protected tenancy' is not validly 
terminated. Even if such Protected Tenant has lost possession of the 
land in question, that by itself does not terminate the 'protected tenancy'. 
The observations of the Full Bench of Andhra Pradesh High Court in 
Sada's case (supra) which were
quoted with approval by this Court in 
Boddum Nursimlm v. Husa11 Ali Khan-' are quite eloquent. 
"'44. In our view, this contention is not correct. If a protected 
tenant is already in physical possession on the date ofnotification 
there is no problem at all. If proceedings under Sections 19, 32 or 
44 are pending, the date of vesting gets itself postponed. If the 
'protected tenancy' stood validly terminated by the date of 
notification under Sections 19, 32 or 44, in that case, no certificate 
at all can be issued. But, as long as a person continued to be a 
'protected tenant' either under Sections 34, 37 or 3 7-A, as per the 
Act and has not lost that status, whether he is in actual possession 
or not on the date ofnotificatio-n, and is also to be 'deemed' to be 
in possession under the first part of the Explanation subject to 
Section 32(7) and the proviso to Section 38-E(l ), the ownership 
stands transferred straightway to such protected tenant by the 
very force of Section 38-E( I). Further, Section 38-£(2) read with 
the A P (T.A.) Protected Tenants (Transfer of Ownership of 
' (2007) 11 sec 410 
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SUPREME COURT REPORTS 
. [2016] 4 S.C.R. 
Lands) Rules, 1973 contemplates a full-fledged inquiry after notice 
to the landholders or after hearing objections of any other interested 
person (vi de Rules 4, 5). Once a certificate is issued, the same is, 
under Section 38-E(2), 'conclusive evidence' of the ownership of 
the protected tenant, and cannot be defeated by the result of any 
inquiry under second part of ti.~ :=.<.planation to Section 38-E. 
Another reason for this view is that the inquiry under Section 38-
E(2) read with the Rules of 1973 referred to above, is to be done 
by the Tribunal (the Revenue Divisional Officer) and obviously 
his decision to grant the ownership certificate will not and cannot 
be jeopardised by the result ofany inquiry by a subordinate official 
like the Tahsildar, who deals with the granting of possession to a 
'protected tenant'." 
13. It is not the case of the appellants that the Protected Tenancy 
ofTeegala Shivaiah was terminated in a manner known to law. In the 
absence of such valid termination of 'protected tenancy', the interest of 
such Protected Tenant continued to be operative and subsisting in law 
and could devolve on his legal heirs and representatives who could then 
claim restoration of possession. As laid down in Sada's case (supra) 
even if the Protected Tenant had lost possession, without there being 
valid termination of his status as a Protected Tenant, he would still be 
entitled to all incidents
of protection under the Act. In the aforesaid 
premises, the view taken by the High Court in allowing Civil Revision 
Petitions in favour of respondents herein was perfectly right and justified. 
14. We thus see no merit in the present appeals which are dismissed 
with costs quantified at Rs.25,000/- in each of the appeals to be paid by 
the appellants to the respondents i.e. the heirs and legal representatives 
of the Protected Tenant. 
Divya Pandey 
Appeals dismissed.