191Z •

386 SUl'itEME CXJURT REPORTS (1962] SUPP.

TEKAN ARD OTHERS

GANESH I

(P. B. GA.TEXDRAGADKAH, A. K. SARKAR and

K. ~. WANCHOO, J, J.)

I.andlord an,/, Tenant-Smtrily of land 1'enures-landowner-Lcssee-Jlortgage-Teuanf -1.rJJser; not lando1cner-No right to ej1:ct-Punjab Security of Land 'l'F.nures Act, 19.53 (Punj"'' JO of l!Jo3), ss. 2 '.I), 9 (l); 14A ([)-East Punjab Displar.ed l'ersons /, rmd Re,.ettlcmui! Ac!, 194fl (East Punjab .16 of 1!14!1), •· 2-Pnnjah /, and Revwat Acl, ISS7 (Punjab 17 of

1887), .<s . .1 (2) 4 ('!)- Punjolr Tenancy Act, 1887 (Punja/) ]Ii of 1881).

The appellant is a lessee from the owner of the Janel and hi" lease comprises a large area of land including the land oi which the rc•pondent is the tenant.

The appellant applied to the Assistant Collector under s. 14A (I) read with s. 9 (I} of the Punjab Security of Land rr.nurcs Act for the ejectment of the respondent on the ground that the appellant was a land o\vner and he required the land for his O\vn cultivation. The application \\'as allov.cd. 1, hc responJcnt thereupon appealed to the Collector alleginl.{ as the main ground that only a landowner could dispossess a tcnantat-v..ill and that since the appellant

was not a landowner within the meaning of S 2 (I) of the Act was r.ot entitled IU ask for ejr.r.tment under s. 14A (I). The Collector accepted this contention and allowed the appeal. '!'hereafter the appellant appealed to the Cornmissioner who allowed the appeal on the ground that a lessee being like a mortgagee with possession was a landowner for all purposes.

On revision the Financial Commissioner Jield that the appcl- 1.ant was not a lanrlowner anti therefore not entitled to cjectmr.nt.

The appellant appealed to this Court by special leave.

The only contention that \-.a:i urged in the appeal was that appellant was a lando\vner \vithin the meaning of s. 2(1).

H(', fd, a'> a lessee the appellant holds land under another person na1nely the O\Vner of the land fro1n whom he has taken the lease and is liable to pay rent. l'he appllant therefore being a tenant \Vithin s.4 (5) of the Punjab 1, enancy Act cannot he a lando\..-ner under s.3(2) of the Punjab Land Revenue Act or a landowner \\ithin the mean in~ of s. 2 ( 1) of the Punjab Sc'.Curity of Land Tenures :\ct. Hence he is not entitled to eject the respondent.

CrVIL APPELLATE JURISDICTION: Civil Appeal No 367 of 1959.

Appeal by special leave from the judgmet and order dated November 23, 1957, of t, he Add1tion<il Commissioner Punjab, in Revision No. 143 of 1956-57.

I. M. Lal and A.G. Ratnaparkhi, for the appel. lants.

Achhru Ram and K. L. Mehta, for the responde t. ·

1962. February 22.

The Judgment of the Court was delivered by

WANCHOO, J.-This is an appeal by special leave from the order of the Financial Commissioner Punjab in respect of the application made by the appellant under s. 14-A(i) of the Punjab Security of Land Tenures Act, No, X of 1953, (hereinafter referred to as the Act), read with s. 9 (l) thereof, for ejectment of the respondent, on th6 ground that he was a smaH landowner. The appellant claimed that he was the landowner and the respondent was a tenant-at-will under him. He therefore claimed ejectment of the respondent on the ground that he had less than thirty standard acres and required the land for his oW-U cultivation. The application was filed before the Assistant Collector who held that the respondent was liable to ejectment and allowed the application. Thereupon there was an appeal by the respondent to the Collector and it was urged there that only a landowner could dispossess a tenant-at-will under s. 14-A, (i) and as the appellant was not a landowner but merely a landlord of the respondent he was not entitied to the benefit of s. 14-A(i). The Collector accepted this contention and held that the appellant was not a landowner and therefore allowed the appeal and dismissed the a, Ptllication fOl' ejectment. The appellant then went

Tekan v.

Gamshi

Wanc1ioo J

196;!

1tk.G11

Ga11t1lzi

Wa11clioo J.

' . 388

SUPRE~IE COURT REPORTS (!!JOO] SUPP.

in appeal to the Commissioner. It may be mentioned that the appellant is a lessco from the owner of the land and his lease comprises a larger area of land including the land of which the rospondent is the tenant. Thu contention on behalf of the appellant before the Commissioner was that he was a landowner within the meaning of that word in s. 2 (I) of the Act and was therefore entitled to eject the respondent. The Commissioner held that the position of a lessee was just like a rnortgageo with possession and that a lessee was a landowner for all purposrs.

He therefore allowed the appcid and restored the. order of ejcctmcnt passed hy the Assistant Collector.

Thereupon the n'spondcnt went in revision to the Financial Commissioner, who held that a mere lessee with only constructive possession as in this case could not be included in tho term "landowner" as used in the Act, and that even if tho appellant was tho landlord of the res

pondent he could not be held to be a landowner within the meaning of the Act.

He therefore allowed the revision, snt aside tho. order of the Commissioner and restored that of the Collector dismissing the appellant's application for ejcctment.

This was followed by an application by the appellant tu thi.e Co.urt for special leave, which was granted; and that is how the mattor has come up before us.

The only question that has been urged on be-. half of the appellant before us-is that. the Financial Commissioner went wrong in holding that he was not a landowner. The question whether tho appe

Hant. is a landowner or not depends upon the definition of that term in the Act, which is. in theee terms:-

"(I) 'Landowner' mean8 a person defined as such in tho Punjab Land Revenue Act, 1887, ( Aot XVII of 1887), and shall include an 'allottee' and 'lessee' as defined in clauses (b) and (c) respectively of section 2 of the East

Punjab Displaced PersonR (Land Resettlement) Act, 1949, (Act XXXVI of 1949) hereinafter referred to as the 'Resettlement Act'.

Explanation-In respect of land mortgaged with possession, the mortgagee shall be deemed to be the lando\\ ner." It is not in dispute that the appellant is not an allottee or a lessee as defined in els. (b) and (c) of s. 2 of the East Punjab Displaced Persons (Land Resettlement) Act, (No. XXXVIof 1949). It is also not in dispute. that the appellant is not a mortgagee with possession. Therefore he can only claim to be a landowner within this definition if he is a landowner as defined in the Punjab Land Revenue Act, (No. XVII of 1887). In that Act the definition of the word "landowner" as given in s. 3 (2) is in these terms:-

" 'landowner' does not include a tenant or an assignee of land revenue, but does include a person to whom a holding has been transferred, or an estate or holding has been let in farm under this Act for the recovery of an arrear of land-revenue or of a sum recoverable as such as arrear and every other person not hereinbefore in this clause mentioned who is in possession of an estate or any share or portion thereof or in the enjoyment of any part of the profits of an estate." The co; ntention on behalf of the appellant is that he must be held to be a landowner within the meaning of this sub-section as he is in the enjoyment of the part of the profits . of the estate. It is obvious that the last part of the definition on which this argument is based applies to persons who are other than tenants and assignees of land revenue, and so we will have to determine whether the appe.

Hant is a tenant; if he is, he is not a landowner. We have therefore to go to the Punjab Tenancy Act, (No. XVI of 1887), to fj.nd O!Jt who is a tenant, a11-q

Tekoii

GlUltJhi

Wanchoo J.

19G2

T1kan

Oaneshi

·anchoo J.

Mo SUPREME OOURT REPORTS (1962] Su1>.P.

whether the appellan.t is a tenant, within that Act.

Definition of "tenant" in s. ! (5) of that Act is as follows:- "(5) 'tenant' means a person who holds land under another person, and is, or but for a special contract would be, liable to pay rent for that land to that other person but it does not include-

(a) an inferior landowner, or

(b) a mortgaee of the rights of a landowner, or

(c) a person to whom a holding has been transferred, or an estate or holding has been let in farm under the Punjab Land Revenue Act, 1887 for the recovery of an arrear of land revenue or of a sum recoverable as such an arrear, or

(d) a person who takes from the Government a lease of unoccupied land for the purpose of sublettillg it;". .

It is not in dispute that the appellant does not come within the four exceptions mPntioned in this sub-section. It has therefore to be seen whether the appellant is a person who holds land under another person and is, or but for a special contract

would be, liable to pay rent for that land to that - other person. We are of opinion that the appellant satisfies this definition of the term "temmt" in s. 4 ( 5).

As a lcBBee be holds land undei another person, namely, tho owner of the land from whom he has taken the lease and is liable to pay rent equal to the lease money for the land which he has taken on lease to that other person. The appellant is therefore clearly a tenant within s. 4 (5) of the Punjab Tenancy Act. He cannot therefore be a landowner under s. 3 (2) of tho Punjab Land Itevenue Aot, Incidentally wo may add that this conclusion is borne out by the fact that in tho copy of the Girdwari entries, the appellant is shown as a

' '

3 S.C.R.

SUPREME COuRT REPoRTS 391

tenant, the entry being "Tekan and others, Gairmaurasian first through Gneshi Gair Maurasi secondhalf. The appellant is thus a tenant of the land of which he has taken lease and cannot be a landowner. keeping in view the definition of that term in the Act and in the Punjab L.and Revenue Act. The appeal therefore fails and is hereby dismissed with costs.

Appeal dismissed.

COMMISSIONER OF INCOME-TAX, BOMBAY

CITY I, BOMBAY

BAI SHIRINBAI K. KOOKA

(S. K. DAS, J. L. KAPUR, P. B. GAJENDRAGADKAR, A. K. SARKAR, K. SuBBA RAo, K. N. WANCHOO

and N. RAJAGOPALA AYYANGAR, JJ.)

Income-tax-Profits-Shares purchased by assessee for investment-Sales of Shares subsequently as trading activity- Oomputation of profit.

The assessee purchased shares by way of investment in 1939-40 at a cost price which was much less than their market value on April I, 1945. Her dividend income therefrom was assessed to income tax. In the financial year 1945-46 the assessee converted these shares iuto her stock-in-trade and carried on business in the shares. Per income for the assessment year 1946-47 was computed on the basis of the profits which she made by the sale of her shares as a trading activity. The assessee contended that the cost price of the shares for compu ting the profits was their market value at the beginning of the year when she started the trading activity, i.e., on April I,

1945. The Department contended that the cost Price of the shares was the actual price for which they were purchased by the assessee, no matter when she bought them and for what purpose.

Held (per Das, Kapur, Gajendragadkar, Suhba Rao, Wanchoo and Ayyangar, JJ. Sarkar, J., contra), •h•t the profits

IS62

Tekon

Gtineshi

Wonchoo J.

February 23.