Case: Ku. Sonia Bhatia Vs. State Of U.P. &amp; Ors

2. The case arose out of an order passed by the Prescribed Authority under the U. P. Imposition of Ceiling on Land Holdings Act, 1960 (hereinafter referred to as the Act), as amended up-to-date, by which the said Authority rejected the claim of the petitioners on the basis of a gift which had been executed by her grand-father by a registered document dated January 28, 1972. The Act was passed as far back as 1960 but by virtue of an amendment, being U. P. Act No. 18 of 1973. Section 5 was introduced which placed a ceiling on any tenure-holder to hold land in excess of the ceiling area fixed under the Act. Section 5 contained various subsections but in the instant case we are concerned only with sub-section (6) as also clause (b) of the proviso to the said sub-section. By another amendment. being U. P. Act No. 2 of 1975, which was given retrospective operation with effect from 8-6-1973 Explanation I. alongwith its sub-clauses, was added to subsection (6) of Section 5.3. The decision in the present case turns upon the interpretation of subsection (6) of Section 5 and the proviso therein in order to determine the validity of the Deed of Gift said to have been executed by Chunni Lal Bhatiya, the grandfather of the petitioner Sonia and respondent No. 4 before the District Judge.4. To begin with, we might like to state here that the facts of the case undoubtedly reveal that if the provisions of the said sub-section (6) were to apply it would work serious hardship to the petitioner but as we are concerned with interpretation of an important statute the mere fact that a correct interpretation may lead to hardship would not be a valid consideration for distorting the language of the statutory provisions.5. Before we proceed to examine the relevant provisions, it may be necessary to give a resume of the facts of the case. Chunni Lal Bhatiya had two sons, Sudesh and Mahesh and a daughter Smt. Sarla. On 14-9-1969 Chunni Lal executed a registered deed of gift in respect of 110 bighas in favour of his son, Sudesh. A month later, another deed of gift was executed in favour of his son, Sudhir (sic). So far as these two gifts are concerned, as they were made before the amendment of the Ceiling Act, their validity was beyond question and they are not the subject-matter of any dispute in the present case. On January 28, 1972 Chunni Lal executed a gift in respect of 80 bighas in favour of his granddaughter, Sonia (daughter of Mahesh). It appears that a serious misfortune had befallen Chunni Lal in that he lost his two sons, Sudesh and Mahesh, who were serving in the Air Force and died in two different air crashes. As Chunni Lal wanted to make sufficient provision for his grandsons and grand-daughter, he executed the three gifts.6. The gift executed in favour of Sonia is the subject-matter of the dispute in the instant case. The Prescribed Authority held that as the gift was made after the due date, i. e. 24-1-1971, as prescribed by sub-section (6) of Section 5, the transfer would have to be ignored. Against the decision of the Prescribed Authority, the appellant filed an appeal before the District Judge, being the Appellate Authority, and assailed the finding of the Prescribed Authority. The District Judge, after hearing the parties, came to a clear finding that the gift was a bona fide one having regard to the circumstances in which the transfer was made and merely because it was executed after the due date (24-1-1971) it could not be held to be invalid. Thereafter. the State of U. P. filed a writ petition in the High Court which was allowed following a Division Bench decision of its Court in Fateh Mohammad v. District Judge, Civil Writ Petn. No. 915 of 1975. Decided on 10-7-1978, which had held that a deed of gift not being a transfer for consideration had to be ignored under the provisions of the Act. Hence, this appeal before us.

Court's reasoning:
9. It is manifest that if these conditions are satisfied and proved to the satisfaction of the Prescribed Authority then the burden which lies on the claimant under Explanation II would have been discharged and the transfer would not be ignored but would fall under the protective umbrella contained in Cl. (b) of the proviso. It may be noticed that the legislature in its wisdom has neither defined the word transfer in any of the definitions of the Act nor has clarified it. The primary object of the Act is to prevent the tenure holders from evading the Law of Ceiling by making fictitious transfers even by registered documents either before or after the duel date so as to evade the provisions of the Act and thus frustrate the very object and the social purpose for which the Act had been passed. In these circumstances, therefore, the word transfer has obviously been used by the legislature in the general sense of the term as defined in the Transfer of Property Act, which is the statute that governs all transfers of movable or immovable properties. In other words, the word transfer being a term of wellknown legal significance having well ascertained incidents, the legislature did not think it necessary to define the term transfer separately. Similarly, the word consideration also being a term commonly used to denote contracts, sales and transactions, has been used in the same sense, that is to say, as defined by S. 2 (d) of the Contract Act.10. It is well settled that whenever the legislature uses certain terms or expressions of well-known legal significance or connotation the courts must interpret them as used or understood in the popular sense.Against this background we have now to consider the real intention of the words "transfer for adequate consideration" as used in clause (b) of the proviso. The High Court has held that although the deed of gift is a transfer but as it is a transfer without any consideration, therefore such a transfer does not fulfil one of the essential ingredients mentioned in clause (b) of the proviso, namely, that it should be for consideration. The High Court has further held that its view is reinforced by the word adequate which qualifies the word consideration which completely rules out a transfer in the nature of a gift. The High Court was of the view that a transfer of property by way of a gift being a purely gratuitous transfer made out of love and affection or for the spiritual benefit of the donor, falls completely beyond the ambit of Cl. (b) of the proviso and, therefore, has to be ignored under the provisions of the said sub-section (6) of Section 5 of the Act.We have given our anxious consideration to the arguments put forward by Mr. Kacker and although the arguments are extremely attractive yet we find ourselves unable to agree with the same.From a conspectus, therefore, of the definitions contained in the dictionaries and the books regarding a gift or an adequate consideration the inescapable conclusion that follows is that consideration means a reasonable equivalent or other valuable benefit passed on by the promisor to the promisee or by the transferor to the transferee similarly, when the word consideration is qualified by the word adequate, it makes consideration stronger so as to make it sufficient and valuable having regard to the facts, circumstances and necessities of the case. It has also been seen from the discussions of the various authorities mentioned above that a gift is undoubtedly a transfer which does not contain any element of consideration in any shape or form. In fact, where there is any equivalent or benefit measured in terms of money in respect of a gift the transaction ceases to be a gift and assumes a different colour. It has been rightly pointed out in one of the books referred to above that we should not try to confuse the motive or the purpose of making a gift with the consideration which is the subject matter of the gift. Love, affection, spiritual benefit and many other factors may enter in the intention of the donor to make a gift but these filial considerations cannot be called or held to be legal considerations as understood by law. It is manifest, therefore, that the passing of monetary consideration is completely foreign to the concept of a gift having regard to the nature, character and the circumstances under which such a transfer takes place. Furthermore, when the legislature has used the word transfer it at once invokes the provisions of the Transfer of Property Act.It would thus appear that this Court clearly held that words adequate consideration completely exclude the concept of love and affection and this decision appears to be on all fours with the facts of the present case. Realising this predicament Mr. Kacker submitted that the words adequate consideration used in the Income-tax Act denote a different texture. Mr. Kacker argued that it is not permissible to interpret or use an expression in one Act as having the same meaning in another Act which is of a different kind. Of course, there can be no. dispute with this proposition but then the Act as also the Income-tax Act have both used the words adequate consideration which, as we have already held, are terms of well-known legal significance having a well recognised popular sense and hence they would convey the same meaning and import whenever used in other statutes unless a contrary intention appears from the language employed by the legislature in the statute. Moreover, the object of the Income-tax Act as also the present Act seems to be more or lessthe instant case also the avowed object of sub-section (6) of Section 5 of the Act is to prevent the large landholders from evading the ceiling law by executing transfers. instruments, or gift so as to reduce their surplus area. Where the two statutes have a common and identical object then the legal terms used in one statute must be given the same meaning in the other. It cannot be said that the words adequate consideration appearing in sub-section (6) of Section 5 of the Act do not take their colour from the context but are in conformity with the main object of the Act; to prevent evasion of the ceiling law by large tenure-holders in anticipation of the passing of the Ceiling Law. For these reasons, therefore, the argument of Mr. Kacker on this score must be rejected. We, therefore, hold that in view of the interpretation placed by this Court on the words adequate consideration which fully applies to the present case and to the same language employed in subsection (6) of Section 5 of the Act, a gift is not only impliedly but expressly excluded by the Act.We fully endorse the observations made by the Division Bench which lay down the correct law on the subject and we overrule the decision of Banerji, J. in Fateh Singhs case, AIR 1978 NOC 101 (All)is true that the District Judge has come to a clear finding that the gift in question is bona fide and has been executed in good faith but as the gift does not fulfil the other ingredients of the section namely, that it is not for adequate consideration, we are afraid. however laudable the object of the donor may have been, the gift has to fail because the genuine attempt of the donor to benefit his grand daughter seems to have been thwarted by the intervention of sub-section (6) of Section 5 of the Act. This is undoubtedly a serious hardship but it cannot be helped. We must remember that the Act is a valuable piece of social legislation with the avowed object of ensuring equitable distribution of the land by taking away land from large tenure-holders and distributing the same among landless tenants or using the same for public utility schemes which is in the larger interest of the community at large. The Act seems to implement one of the most important constitutional directives contained in Part IV of the Constitution of India. If in this process a few individuals suffer severe hardship that cannot be helped, for individual interests must yield to the larger interests of the community or the country as indeed every noble cause claims its martyr.30. As this was the only point raised before us, we find no. merit in the same.