Case: Smt. Kalawati Vs. Bisheshwar

2. Some of the relevant facts may first be set out :Prior to June 14, 1952 Kapurthala Estate was the owner of the mango grove in suit. On June 14, 1952 the Estate sold the said grove to the appellant. A notice to quit was thereafter served on the-respondent tenant but as he failed to deliver possession the Kapurthala Estate and the appellant filed on May 12, 1954 the suit out of which this appeal arises. On October 1, 1959 the Kapurthala Estate withdrew from the suit leaving the appellant the sole plaintiff. The respondent-tenant raised several defences in his written statement. The Trial Court raised several issues amongst which issue No.7 was : "Whether any rights have accrued in law in favour of plaintiff No. 2 under the sale deed dated 14th June 1952." The Trial Court tried that as a preliminary issue and held that the sale deed in favour of the appellant was void, that she did not acquire thereunder any interest in the said property, and in that view dismissed the suit. In appeal the learned Civil Judge, Mohanlalganj, held that the sale deed was not void and that after the deletion of Clause (b) of Section 23 (1) by Amendment Act, XX of 1954 the appellant was entitled to maintain the suit despite withdrawal by the Kapurthala Estate. Consequently he remanded the case to the Trial Court for deciding the rest of the issues. Against that order the respondent filed an appeal in the High Court contending once again that the said sale was void and conferred no right title or interest in the appellant, and being void from its inception, remained void for all time and could not be taken into consideration in spite of the deletion of the said clause (b). The reamed Single Judge who heard that appeal dismissed it holding that the said sale was a valid transfer that Cl. (b) of Section 23(1) only provided a ban against recognition for any of the purposes under the Act and that after its deletion first by Act XX of 1954 and then by Act XVIII of 1956 the appellant could maintain the suit though the Kapurthala Estate had withdrawn therefrom. The Division Bench of the High Court which heard the Special Appeal against the judgment of the learned Single Judge differed from the view of Section 23 (1) (b) taken by him allowed the appeal and dismissed the suit.

Court's reasoning:
Leaving aside for the time being Clause (b) of Section 23 (1) there is otherwise nothing in the Act which provides that a transfer validly effected prior to July 1, 1952 shall be void and will have no effect. There is also nothing in the Act touching the consequence of such a transfer under the Transfer of Property Act9. There is a clear distinction between a transaction being void that is, non-existent from its very inception and a ban against its recognition. Indeed when it is said that such a transaction is not to be recognized for any purpose whatsoever it postulates that the transaction does, exist and is valid but is not to be recognisedThere is thus a clear distinction between a transaction being void and one though valid and existent which is not to be recognised or acknowledged. The legislature also appears to be fully aware of the distinction between a void transaction and one which is not to be recognised. In Sections 24 and 166 the legislature has declared certain transactions therein set out void and of no effect as against Clause (b) of Section 23 (1) where it provides only a bar against recognition. That being so it is impossible to say that the bar of recognition in Clause (b) to a transfer made after July 7, 1949 means that such a transfer is void. The sale in favour of the appellant was therefore valid and did have the effect of conveying and vesting the ownership of the property in the appellantThe sale in favour of the appellant transferred all rights of ownership of the Kapurthala Estate in the appellant and therefore the appellant became the zamindar in respect of that property. Section 4 of the Act abolished zamindari rights and vested those rights in the State Under S. 18 the zamindar who is the intermediary would become the bhumidhar and therefore by reason of the sale in her favour it was the appellant who became entitled to the bhumidhars rights. But for Clause (b) of Section 23 (1) it would be the appellant who would have to be recognised as such bhumidhar and it would be she who would be entitled to the rights of compensation and rehabilitation grant under Chapters III and IV as an intermediary, the right to retain possession of the property and to evict a tenant therefrom. That is the simple position emerging from Sections 4, 18 and 23 (1) (b)11. In the earlier part of its judgment the Division Bench expressed its inability to appreciate as to why the legislature went out of its way to enact Clause (b). For it did not matter to the State as to whether it was the transferor or the transferee who became the bhumidhar. But the legislature had a clear purpose in enacting Clause (b) and it is because the learned Judges failed to appreciate that purpose that they allowed themselves to deviate from the true construction and object of that clause. The legislature was aware that transfers of zamindari properties had taken place before the Act came into force and as a result it would be the transferees thereunder who would be the intermediaries and therefore bhumidhars under Section 18 with rights inter alia to compensation and rehabilitation grant. The purpose of the legislature however was to recognise the original owners that is, the transferors as persons entitled to the rights of bhumidhars and therefore provided in Clause (b) that no such transfer is to be recognised "for any purpose whatsoever".Though therefore such a transfer made the transferee an intermediary and therefore a bhumidhar under Section 18 clause (b) laid down a bar against its recognition. The words "any purpose whatsoever" were used in cl. (b) as Clause (a) of Section 23 (1) provided that a transfer made on or after July 1, 1948 was not to be recognised for the purpose only of assessing rehabilitation grant payable to an intermediary. But there are purposes under the Act other than payment of rehabilitation grant such as compensation payable under Chapter III and other rights of a bhumidhar provided in other parts of the Act. When Section 23 (1) is read as a whole it is clear that with respect to transfers made after July 7, 1949 the legislature wanted to lay down a bar against its recognition for all these purposes also and hence advisedly used the words "for any purpose whatsoever", that is, for all purposes under the ActThe Division Bench therefore was not right in saying that Cl. (b) did not serve any useful purpose and that it did not appreciate why the legislature had enacted that clause. It is because this was the purpose of enacting Cl. (b) that the legislature also enacted a deeming provision under which the estate is to be deemed to continue to vest in the transferor. The impact of Cl. (b) on the transfer made after July 7, 1949 is that though the transferee by reason of such transfer becomes the intermediary and a bhumidhar under Section 18, it hers recognition of his rights as such bhumidhar for any of the purposes of the Act whatsoever. Instead, as a result of the deeming provision in the clause, the transferor continues to have those rights notwithstanding the transfer. If the clause had rendered such a transfer void and therefore non-existent the transferor would have remained the owner of the property and would have the rights of a bhumidhar under Section 18 and there would not have been any necessity of enacting the deeming provision under which the property though transferred is deemed to continue to vest in such transferor13. The position which emerges from this discussion is that when the suit was filed though the appellant was the intermediary and the bhumidhar under Sec. 18, her right to evict the respondent could not be recognised. As the estate was deemed to continue to vest in the transferor, Kapurthala Estate had to join in the suit as a co-plaintiff.From October 10, 1954 the bar was removed and the appellant became entitled to maintain the suit in her own right and the withdrawal of Kapurthala Estate as plaintiff No. 1 did not affect the maintainability of the suit.The contention of Mr. Shukla that the withdrawal must be deemed to date back to the institution of the suit has in our view no force. No such order was made by the Trial Court which ordered the withdrawal. The withdrawal therefore took place after the bar under Cl. (b) against recognition of the appellants rights was deleted and the appellant therefore lad the right to maintain the suit