Case: Rajasthan Housing Board Vs. New Pink City Nirman Sahka.Sam.Ld

2. The appeals arise out of a common judgment and order dated 29.10.2009 passed by a Division Bench of the High Court of Rajasthan in Special Appeal No.13/2001 and other connected matters. The Rajasthan Housing Board, original Khatedars and the New Pink City Housing Construction Co-operative Society Ltd. (transferee) (hereinafter referred to as thehave assailed the impugned judgment and order on different grounds. The Rajasthan Housing Board has prayed for setting aside direction to consider 25% of developed land and compensation, whereas the original khatedars have prayed for payment of compensation to them. Similarly, the Rajasthan Housing Board has also questioned the entitlement of the Society to claim compensation. The Society has also claimed for more value of land.3. The State Government issued a notification under section 4 of the Rajasthan Land Acquisition Act, 1953 (for short ‘the Act ofon 12.1.1982. The land had been acquired for the purpose of housing scheme of Rajasthan Housing Board. On 22.5.1982 the possession had been handed over to Rajasthan Housing Board under section 9 of the Act of 1953. The Society preferred objections before the Land Acquisition Officer (LAO). The objections preferred by the Society were rejected vide order dated 4.9.1982. Thereafter, Award was passed with respect to four cases by the LAO on 30.11.1982 in favour of Khatedars. With respect to the remaining cases the award was passed on 2.1.1989 by the LAO. Notice under section 12(2) of the Act of 1953 was issued to the Society with respect to the award of 30.11.1982 on 31.12.1988.4. The Society applied for reference under section 18 of the Act of 1953. On 17.4.1989, the reference was made to the Civil Court. One of the Khatedars namely Prabhu also sought reference registered as Case No.43/1989. The Civil Court answered the reference on 23.1.1994 determining the compensation at Rs.260 per sq.yd. The objection raised by the Housing Board with respect to the entitlement of Society under section 42 of the Rajasthan Tenancy Act, was brushed aside. On appeal to the High Court, the single Bench vide impugned judgment and order dated 22.3.1999 reduced the compensation to Rs.100 per sq.yd. The Division Bench has not only affirmed the aforesaid award but has additionally directed to consider allotment of 25% of developed land in view of circular dated 27.10.2005 in terms of the order passed by a Division Bench in Special Appeal No.697/1995.5. The Khatedars have claimed that they areby caste which is a Scheduled Caste notified under the Constitution Scheduled Castes Order, 1950.6. The Society has claimed that it had entered into an agreement to sell with Khatedars of the land on 15.2.1974, 17.2.1974, 21.2.1974 and 22.1.1976. The Society has also claimed that it had applied to the Rajasthan Housing Finance Society Ltd. for financial assistance for construction of houses and an NOC dated 7.6.1982 was issued to it by the Urban Improvement Trust, Jaipur. The Society objected to the acquisition but objections were rejected on 3.9.1982 in four cases out of which Reference Case No.1989, 2089, 3089 and 4089 arose. The award was passed on 30.11.1982. Later on, the Society appears to have filed a civil suit for specific performance of agreement to sell in the year 1986 against the Khatedars and compromise decrees are said to have been passed on 2.10.1986, 3.10.1986 and 24.1.1988 thereby decreeing the suit in favour of the Society.

Court's reasoning:
Admittedly, possession from the Society had been taken on 22.5.1982. The Society submitted the objections before the LAO on 20.7.1982. While rejecting the objections on 4.9.1982, the Special Officer, Urban Development Authority, LAO, had unilaterally observed that the acquisition cannot be said to be in violation of the provisions contained in Article 300A of the Constitution of India, the Society has no ownership of the land, it has no interest in the land. Thus, it has no right to raise the objection. The said order had attained finality and the award was passed on 30.11.1982. In the award so passed, it has also been mentioned that an Advocate had appeared on behalf of the Khatedars and wanted to file objections regarding compensation.In the instant case, notice under section 12(2) was issued to the Society by the Special Officer on 31.12.1988, treating the Society as ‘personand informing that an award had been passed on 30.11.1982 in accordance with section 11 of the Land Acquisition Act. On the strength of the aforesaid notices it was urged on behalf of the Society that the limitation to seek the reference would commence from the date of receipt of the notices issued and received on 31.12.1988. The reference sought was within the period of limitation.In the instant case it is apparent that the Housing Society had preferred objections and was aware of the land acquisition process and determination of compensation and has filed objections which stood rejected on 4.9.1982. Thus, the constructive knowledge of the award is fairly attributable to it when it was so passed. Constructive notice in legal fiction signifies that the individual person should know as a reasonable person would have.It is also apparent that the Society had actively participated in the other pending cases with respect to determination of compensation in which award had been passed on 2.1.1989. Thus the reference sought on the strength of the notice under section 12(2) issued and received on 31.12.1988 would not provide limitation to the Society for seeking reference with respect to the four cases in which the award was passed on 30.11.1982 as notice to it was wholly unnecessary in view of rejection of its objection on the ground that it was not having right, title or interest in the land. Thus it could not be said to be ‘personin view of the order dated 4.9.1982. The notice was issued for reasons best known to the Special Officer. It is surprising how and for what reasons notice was issued after six years. We need not go into this aspect any further as we are of the opinion that in the facts and circumstances, the Society had a constructive notice of the award dated 30.11.1982. Thus, in view of the conjoint reading of sections 12(2) and 18(2) of the Rajasthan Land Acquisition Act, it was not open to the LAO to refer the case to the civil court on the basis of the time barredthe counter affidavit filed on behalf of the Society, the factum that Khatedars areand belongs to Scheduled Caste, has not been denied. Before the Reference Court also, the stand of the State Government was that as the Khatedars belong to Scheduled Caste, the transaction was prohibited by section 42 of the Rajasthan Tenancy Act. On behalf of the Society, it was submitted in counter affidavit that as it is a Society, the rigor of provisions of section 42 is not attracted and it had relied upon the circular dated 1.9.1984 issued by the Government of Rajasthan for regularisation of the land sold in violation of section 42 of the Rajasthan Tenancy Act. The Society has failed to deny clear and categorical averments,makes the aforesaid facts undisputed one. There is not even an evasive denial that Khatedars do not belong to Scheduled Caste. Even in the additional affidavit filed on behalf of the Society in the wake of the rejoinder filed by the petitioner in reply to the counter affidavit of respondent No.2, the caste of the original Khatedars has not been disputed. Thus, we are of the considered opinion that the original Khatedars areby caste which is a Scheduled Caste and they are entitled to the protection of the provisions contained in section 42 of the Rajasthan Tenancy Act.In the instant case, the transaction is ab initio void that is right from its inception and is not voidable at the volition by virtue of the specific language used in section 42 of the Rajasthan Tenancy Act. There is declaration that such transaction of sale of holdingAs the provision is declaratory, no further declaration is required to declare prohibited transaction a nullity. No right accrues to a person on the basis of such a transaction. The person who enters into an agreement to purchase the same, is aware of the consequences of the provision carved out in order to protect weaker sections of Scheduled Castes and Scheduled Tribes. The right to claim compensation accrues from right, title or interest in the land. When such right, title or interest in land is inalienable to non-SC/ST, obviously the agreements entered into by the Society with the Khatedars are clearly void and decrees obtained on the basis of the agreement are violative of the mandate of section 42 of the Rajasthan Tenancy Act and are a nullity. Such a prohibited transaction opposed to public policy, cannot be enforced. Any other interpretation would be defeasive of the very intent and protection carved out under section 42 as per the mandate of Article 46 of the Constitution, in favour of the poor castes and downtrodden persons, included in the Schedules to Articles 341 and 342 of the Constitution of India.The right to claim compensation cannot be enforced by the Society on the basis of such transaction as that would defeat the very object of the Act and the constitutional provisions including such castes and tribes under the protective umbrella of the Schedules to Articles 341 and 342, they cannot be deprived of right to obtain the compensation of the land legally held by them and they cannot be made to fall prey to unscrupulous devices of land grabbers. The right to claim compensation is based on right, title or interest in the land, cannot be transferred by virtue of the mandate of section 42 to a juristic person like the Society. It is the duty of the State to ensure that the benefit reaches to such persons directly and not usurped by intermeddlers as what is intended by the protection of the right to hold property of SC/ST, cannot be taken away by disbursing the compensation to Society. Persons of SC/ST, as the case may be, are the only rightful claimants to disbursal of compensation and such right cannot be tinkered with by void transaction as the purpose of compensation is theof Scheduled Castes orfrom that, voidity of the transaction can be looked into in these proceedings also when right to claim compensation is asserted by the Society and from factual conspectus of the instant case it is apparent that Khatedars belong to Scheduled Castes and they cannot be deprived of their right to claim compensation, intendment of section 42 can be effectuated in these proceedings.When we consider the aforesaid submission, it is apparent that the right to hold property cannot be taken away except in accordance with the provisions of the statute but in the instant case, we are of the considered view that the right to hold property albeit had not been acquired by the Society, transction was ab initio void and a nullity. On the other hand, the land has been acquired by the State Government and even the right to claim compensation was denied to the Society in the award passed on 30.11.1982 by rejecting their objections. The recourse to section 175 was not required as already held by us.It is apparent from para 1 that the Circular is applicable in the matter of land acquisition when the Khatedars surrendered their lands.In the instant case, even the prevalent instructions which have been modified did not confer any right on the Society or the Khatedars to claim the developed land. It was not a case of surrender of land; thus there was no question of the provisions of the circular being applied as the circular was in the form of guidelines for future acquisitions where Khatedars surrendered their lands and award has not been passed. For the aforesaid reasons, the aforesaid circular could not have been pressed into service by the Society and that too at the appellate stage before the Division Bench. The Division Bench has gravely erred in law while issuing the aforesaid directions which were wholly unwarranted and uncalled for.Thus, it is apparent that the circular in question cannot be pressed into service by the Society. Apart from inapplicability, it is also apparent that the very purpose of issuing such circulars is not to benefit the purchaser who has acquired the right after issuance of notification under section 4 of Rajasthan Land Acquisition Act, and in violation of mandate of section 42. Consequently, the High Court had no jurisdiction to direct allotment of land. Even Khatedars were not entitled to such direction/benefit as the circulars are not applicable in such cases.Coming to the quantum of compensation to be awarded in the instant case, it was submitted on behalf of the Society and Khatedars in respective appeals that the compensation determined by the High Court is on lower side. Adequate compensation has not been determined. It was submitted that oral evidence which was relied upon by the Reference Court ought to have been acted upon by the High Court. It was contended that the oral evidence cannot be ignored.The High Court has rejected the application under Order 1 Rule 10 filed by the Khatedars. In the facts of this case, particularly when the issue of violation of section 42 of Rajasthan Tenancy Act was raised by the State Government and reference was also as to the award passed in 1982 in favour of Khatedars in which the Society was denied the right to receive compensation. Obviously, Khatedars were required to be heard as the adjudication of their right was involved in the matter to decide to whom the compensation is payable, and whether the Society was entitled to claim compensation on the basis of void transaction. It was also submitted before us that the Khatedars have sought reference under section 30 against the Society, that question can be decided in those proceedings. However, the factual matrix and its determination of the question as to entitlement of Society is necessary in the instant case, as such we have decided it. More so, the plight of downtrodden class of the Scheduled Castes Khatedars cannot be prolonged and considering the provisions which have been enacted for their protection, and the constitutional mandate, we are inclined to exercise our power to set at rest the dispute between the parties and hold that only Khatedars, in case some of them have died, their legal representatives would be entitled to receive the compensation which has been determined in the instant case.