Case: Azmat Azim Khan Vs. Board Of Revenue, Uttar Pradesh, Allahabad &amp; Ors

2. The appellant son of Sardar Mujibul Rahman Khan a Zamindar of a number of villages in the District of Kheri Uttar Pradesh impeached the orders of the Board of Revenue of Uttar Pradesh dated 30 August, 1960 and 6 September, 1960 whereby the Board issued three directions. The first was to stop payment of instalment money on the bonds by the treasuries. The second was to direct the Compensation Officer to hand over bonds of the face value of Rs. 32,000/reported to be remaining with him for liquidation of debts. The third was an order attaching movable and immovable properties belonging to the appellant and his brother for liquidation of debts.3. The principal question in this appeal is whether the find respondent, the Board of Revenue Uttar Pradesh had authority to pass the order impugned in this appeal.4. The third respondent Raja Shatranjai thewas a creditor of the appellants father Sardar Mujibul Rahman Khan on the basis of a mortgage deed. Raja Shatranjai obtained a decree on the said mortgage debt for Rs.as costs. The decree is dated 26 September, 1939. The decree was passed under the provision of the Uttar Pradesh Encumbered Estates Act 1934 (hereinafter referred to as the 1934 Act). The decree was passed on the application of Sardar Mujibul Rahman Khan under Section 4 of the 1934 Act for the liquidation of his debts. The debtor was a zamindar in the District of Lakhimpur Kheri. The decree was transferred to the Deputy Commissioner of Kheri for liquidation of debts.5. Meanwhile the U. P. Zamindari Abolition and Land Reforms Act, 1951 (hereinafter referred to as the 1951 Act) came into force. The proprietary rights of the intermediaries vested in the State Government and the intermediaries were entitled to receive compensation in lieu thereof. Thewas an intermediary. Notices were issued to the intermediaries to take delivery of the bonds or receive payment in cash on specified dates. The appellant on the death of his father became entitled to 2/3rd of the Zamindari property and compensation therefor. He took delivery of the compensation bonds of the value of Rs. 42,750/from the Compensation Officer, Lakhimpur while bonds of the value of Rs. 21,250/On 14 April, 1959 theapplied to the Collector, Kheri for an order that the appellant and his brother do return the bonds which they had received from the Compensation Officer failing which their movable and immovable properties to the extent of these bonds be attached for liquidation of their debts. The Collector on 17 August, 1959 rejected the application. Thepreferred an appeal. The appeal was dismissed by the Additional Commissioner, Lucknow on 17 February, 1960. Thethereupon commenced revision proceedings before the Board of Revenue. On 30 August, 1960 a member of the Board of Revenue allowed the revision. On 6 September, 1960 another member of the Board of Revenue concurred in the order. The Board asked the Collector to take one or other of the three steps, namely, the treasuries to stop payment of money on instalment in respect of the compensation bonds or direct the Compensation Officer to hand over bonds of the face value of Rs. 32,000 reported to be remaining with him for the liquidation of the debts or to attach the movable properties of the appellant and his brother for the liquidation of debts.7. The appellant thereafter made an application to the High Court under Article 226 of the Constitution for an order quashing the order and directions of the Board of Revenue. The learned Single Judge quashed the order of the Board of Revenue save and except the direction directing the Compensation Officer to hand over bonds of the face value of Rs. 32,000/reported to be remaining with him for liquidation of debts.8. Thereafter thepreferred an appeal. The Bench of the High Court was divided in their opinion. The matter was placed before the third learned Single Judge. The order of the High Court was that direction No. 3 of the Board of Revenue, namely attachment of movable and immovable properties of the appellant and his brother was quashed. The High Court upheld the other two orders of the Board of Revenue in regard to stoppage of payment of instalment money on the bonds by the treasuries and direction on the Compensation Officer to hand over the bonds of the face value of Rs. 32,000/remaining with him for liquidation of the debts.

Court's reasoning:
10. The Collector, therefore, by reason of the provisions of the 1934 Act and the 1950 Act requires the Compensation Officer and the Rehabilitation Officer to place the amount of compensation at this disposal. The Collector on receipt of the grant is to expend or utilise the same in liquidation of the amount of the secured debt and if the balance remains it is to be utilised in discharging the debts other than those mentioned in Section(1) of the 1934 Act, in order of priority.11. By reason of the provisions contained in Section 70 of the 1950 Act and Sectionof the 1934 Act the compensation money is sent for by the Collector for the purpose of liquidation of secured debt on which decree is passed. The Compensation Officer under Rule 77 (1) of the Zamindari Abolition and Land Reforms Rules, 1952 could issue notice to the intermediary directing him to take delivery of the bonds. The issue of a notice would not clothe the intermediary with the right to take away the bonds because under Section 18 of the 1934 Act thebecomes entitled to recover the amount of the decree in the manner and to the extent mentioned in the 1934 Act. The proviso to Section 18 of 1934 Act enacts that the secured debt shall be recoverable from the compensation and rehabilitation grants as though the security had not been extinguished. The question, in the present case, is whether the appellant could lawfully obtain delivery of the bonds from the Compensation Officer. Sections23A and 23Bof the 1934 Act require that the amount or the bonds on account of compensation or rehabilitation grant received by the Collector shall be expended or utilitsed by the Collector in liquidation of the amount of the secured debt. Under Sectionof the 1934 Act the bonds are received by the Collector in pursuance of the requisition under Sectionof the 1934 Act. The absence of the service of a requisition cannot confer a right on theto take away the compensation money or bonds. The principle is actus curiae neminem gravabit.12. Theunder the provisions of the relevant statutes was entitled to be paid out of the compensation grant monies in satisfaction of the decree. If the Collector had required the Compensation Officer under Sectionof the 1934 Act to place at his disposal pursuant to Section 70 of the 1950 Act the compensation money, the bonds could not have been taken delivery of by the appellant. The Board of Revenue rightly gave the directions to secure compliance with the provisions of the statute and performance of statutory duty by the Collector as well as the Compensation Officer. The appellants were not entitled to receive the bonds without satisfying the decree. The appellants were wrong in doing so. The appellant could not take advantage of his own wrong. That is why the Board of Revenue correctly directed the stoppage by the treasuries of payment of instalment money on the bonds. "The other direction by the Board of Revenue requiring the Compensation Officer to hand over the bonds remaining with the Compensation Officer was in aid of valid compliance with Sections23A and 23Bof the 1934 Act as well as Section 70 of the 1950 Act.13. The jurisdiction and authority of the Board of Revenue in the present appeal touched directly on the performance of statutory obligations by statutory authorities. The compensation bonds are required by the statute to go to the Collector for liquidation of secured debts. Theis not entitled to the compensation bonds without liquidation of the debts in accordance with the provisions of the statute.