The State of Madras vs Vasudevan Potti and Others

Ramakrishnan, J.—These appeals arise from the decree and judgment of the learned Subordinate Judge of Nagarcoil in O. S. 21 of 1961 The suit was filed in forma pauperis by one Vasudevan Potti, son of Subbaraya Potti, for the recovery of Rs. 36,257-77, or, in she alternative, Rs. 20,215. The defendants are the State of Madras represented by the District Collector, Kanyakumari Dt., Nagarcoil, and the Kanyakumari Devaswom Board, represented by its President. The suit was filed under the following circumstances. Two survey Numbers, S. No. 1222 and S. No. 1382/631 of Nagarcoil village, belonged to the plaintiff''s father. These survey numbers were acquired by the erstwhile Travancore Government for the use of the Nagaraja temple at Nagarcoil, under the provisions of the Travancore Land Acquisition Regulation (Regulation XI of 1099). It is common ground that this Regulation is on the same terms as the Indian Land Acquisition Act (Act I of 1894), The award of the Land Acquisition Officer was passed on 1st February 1928, but possession of the land was not taken by the acquiring authorities. Ultimately, the authorities withdrew from the acquisition without taking possession of the land. The request for such a withdrawal was made on 15th March 1929, by the authorities of the Devaswom board and this request is Ex. B.11. The reason given for the withdrawal was that the price of the land, as fixed in the award, was too high. The Government of Travancore passed proceedings on 15th March 1930, (Ex. B 10), withdrawing from the acquisition. In the meantime, some creditors, who had mortgages over the properties sought to be acquired, filed suits and obtained decrees on 5th September 1924 and 2nd August 1929 respectively. S. No. 1222 was sold in court auction on 24th March 1930. S. No. 1382/631 was sold on 4th June 1930. The Devaswom Board (second defendant) purchased these properties in court auction and subsequently part of the sale proceeds was adjusted to meet the claims of creditors During the time of the aforesaid proceedings the plaintiff was a minor and was represented by his mother as his guardian. Long after the acquisition proceedings as well as the execution proceedings were ever the plaintiff filed the present suit on 9th January 1961. the amount claimed in the plaint, by way of relief, is the compensation amount as determined in the award with 15 per cent solatium and adding thereto the subsequent interest. The alternative amount is the amount after deducting the amounts due to the creditors, which the defendants had paid. In the plaint it is specifically averred that Government became the legal owner of the properties after the land acquisition proceedings and that the auction purchases in execution of decrees were brought about by fraud played upon the plaintiff and his family members. There was a further allegation that there was no notice of the withdrawal of the land acquisition proceedings and the plaintiff''s family was under the bona fide impression that the temple authorities had been in possession only as a result of the land acquisition proceedings. Relying on these allegations the suit was filed for recovery of the compensation amount under the terms of the land acquisition award. The defendants denied the plaintiff''s claim in toto. They urged that the land acquisition proceedings were not completed and the defendants withdrew from the land acquisition proceedings, as they are entitled to do under S. 34 of the Travancore Land Acquisition Regulation, which corresponds to S. 48 of the Indian Land Acquisition Act. It is also claimed that no title, in such circumstances, would pass to the Government. Title under S. 16 of the Land Acquisition Act will pass only on the taking of possession of the land In pursuance of the Award. The plaintiff cannot seek any relief, by way of payment of compensation amount, in seen circumstances.

The learned Subordinate Judge, who tried the suit came to the conclusion that title passed and the property vested in the defendants as soon as the award was passed. He also found that the execution proceedings and the taking of possession of the properties there under were done in a clandestine fashion. He further found that a trick was played by the Devaswom department on the plaintiff. Based on these findings, he gave the plaintiff a decree for the compensation amount, after deducting the amounts paid to the creditors. Since the main points are dealt within the appeal field by the State (A. S. No. 209 of 1963), we will consider the points raised in that appeal first.

The point for determination in the appeal is whether the plaintiff is entitled to relief, by way of payment of compensation amount, on the basis of the allegations made by him in the plaint.

The position of law on the subject of passing of title in respect of properties acquired under the L and Acquisition Act is very clear. The law as laid down under the Indian Land Acquisition Act will apply equally to cases arising under the Travancore Land Acquisition Regulation, which is in identical terms. It is well-known that when any Award is passed under S. 11 of the Land Acquisition Act, it amounts only to an offer payment to the owner of the compensation, but by Itself it will not pass title to the acquired property. The owner of the land can accept the award or refuse to accept it. In the latter event, he has got remedies open under the Land Acquisition Act. He can get the compensation amount enhanced. If there is a dispute about the title, he can get that title adjudicated. But so far as the passing of title to the property is concerned, it passes only when possession of the property is taken from the owner; see S. 16 of the Land Acquisition Act. This view is reinforced by the prevision in S. 28 of the said Act under which interest is payable only from the date of taking possession.

The further position is that under S. 48 of the Land Acquisition Act (corresponding to S. 34 of the Travancore Land Acquisition Regulation) the Government can withdraw from the acquisition of any land at any time before possession is taken. The earlier law which prevailed before 1894 prohibited the withdrawal after the passing of the award. It was found that this provision caused a great deal of hardship. It was thereafter that S. 48 was amended in its present form in the Indian Act, The observations of the Select Committee, which considered the question of this amendment, can be usefully extracted :

Sec. 54 of the Act (X of 1870) gives to the Government or the public bodies whom it represents the powers of withdrawal from land it has proposed to acquire. This power however must be exercised before the award is made. After award, withdrawal is prohibited whatever may be the circumstances. Experience has shown that the only occasion on which powers of withdrawal would be really useful are when an award has shown that the Government was seriously misled by an underestimated of the value of the land. We think therefore that the power to withdraw should be given after as well as before, the award, but that if so exercised, it should only be on terms of the most liberal compensation to the owner and that, if he is (not) satisfied with the collector''s offer, he should have the same rights of reference to the Judge as in case of acquisition

Rule 14 of the Rules framed by the Travancore Government under the Regulation, reads thus:

Division peishkars should not ordinarily take possession of the land before all the preliminary steps ore scribed by the regulation have been taken. This is so the more especially in view of S. 34 of the Regulation which secures for Government the liberty to withdraw from acquisition (on account of excessive cost or otherwise) when possession has not been taken.

It is under this role that the request for withdrawal (Ex. B. 11). was made by the devaswom on 15th March 1929. Ex. B. 11 reads thus:

With reference to your docket Dis, No. 1905, of 25, dated 17th September 1925, re : the acquisition of land to provide residence for the Santhikars of the Nagarcoil devaswom, I have the honour to inform you that the total extent of the land ordered to be acquired for the purpose 70 cents comprised in S. Nos. 1221,1222 and 1382/631 of the Nagarcoil paguthy. Six cents of land from S. No. 1221 has been acquired and handed over to the Devaswom department. The devaswom Commissioner has now written to say that as the cost of acquiring 64 cents comprised in S. Nos. 1222 and 1382/631 is seen to be high, the acquisition proceedings in respect of this area may be dropped. The Tahsildar has reported that the above land has not been taken possession of In the circumstances, I request that you will be so good as to obtain and communicate to me the early sanction of Government for the acquisition proceedings in respect of 64 cents of land being with drawn.

This request was followed by the order of Government Ex. B. 10 on 15th May 1930, sanctioning the withdrawal.

Learned counsel for the respondent-plaintiff, Sri M. S. Venkatarama Aiyar, draws our attention to R. 5 of the rules framed under the Land Acquisition Act, I of 1894, by the Madras Government, which requires that the withdrawal should be published In the Gazette. One decision of this court, Khan Bhahadur Chowkaran Keloth Mammad Koyi Vs. Province of Madras and Another, says that such publication is compulsory. Learned counsel also relies on S. 14 of the Travancore General Clauses Regulation II of 1072. which requires that the same procedure and the same formalities as were followed when notifications were made for acquisition, should be followed also when proceedings are withdrawn or rescinded. No corresponding rule, similar to R. 5 (Madras), is found in the Travancore Rules framed under the Land Acquisition Regulation. It appears to us, however, that the failure to publish the withdrawal will not have the result of passing title to Governments. The consequence of failure to publish the withdrawal will be damages for which the owner can file a suit. In this connection reference can be made to Art. 18 of the Limitation Act (IX of 1908), which provides a time limit of one year for filing a suit for compensation when acquisition is not completed. The time runs from the date of the refusal to complete.

It is pertinent to observe that the present suit is not framed as one for damages under S. 48 of the Land Acquisition Act, or S. 34 of the Travancore Land Acquisition Regulation. S. 48 (2) of the Land Acquisition Act is in the following terms :

Whenever the Government withdraws from and such acquisition, the Collector shall determine the amount of compensation due for the damage suffered by the owner in consequence of the notice or of any proceedings there under, and shall pay such amount to the person interested, together with all costs reasonably incurred by him in the prosecution of the proceedings under this Act relating to the said land.

It is clear, therefore, that the relief for compensation due for the damage suffered on account of the withdrawal from acquisition, has to be granted by the Collector.

Even assuming that there was no publication of the withdrawal from acquisition, the plaintiff was a party to the execution proceedings through his guardian. The said proceedings were not carried out in secret. There was due publication of the sale and all the formalities relating to execution proceedings were duly followed. It is not alleged before us that any part of the execution proceedings was defective. Therefore, it must be held that the plaintiff through his guardian must have been aware that possession was taken subsequently by the Devaswom authorities in execution proceedings. At least on the date of taking of such possession, the plaintiff must be deemed to have had knowledge of the withdrawal from the land acquisition proceedings.

The law on this subject of passing title Is clearly laid down by the Supreme Court is Dr. G.H. Grant Vs. State of Bihar, "An award by the Collector is strictly speaking an offer made to the parson interested in the land notified for acquisition, the latter may, but is not bound to accept the offer. He may ask for a reference to the court for adjudication of his claim for adequate compensation. He may even accept due compensation under protest relating to the sufficiency of the amount and ask for a reference. It is also open to the Government, even after the award is made but before possession is taken, to withdraw from acquisition of any land in exercise of the powers conferred by Sec. 43 of the Land Acquisition Act. Thus, it is not the award of the Collector which is the source of the right to compensation; the award merely quantifies appropriate Government''s offer which is made because the Government has taken over, or intends to take the land of the owner under the authority given by the Act. The scheme of the Act also supports this."

Here, what is subsisting is only the Award, but no possession was taken there under Therefore, on the principle laid down above, the Award cannot form the source of a right to compensation; only the taking of possession could give rise to such a right. Here, the possession of the property has not been taken in pursuance of the had acquisition proceedings, but only in the course of execution proceedings.

The learned Subordinate Judge has observed, after referring to the decision of a Beach of this court in Kasturi Pillai v. Municipal Council, Erode 37, M.LJ. 618, that the passing of the award is enough to pass title. This is clearly a wrong view of the law. It is also opposed to the decision of the Supreme court above-mentioned. Kasturi Pillai v. Municipal Council, Erode (3), in fact is no authority for such an Erroneous proposition. There is an observation at page 620 thereof "In any case, the award must be regarded as passing titles to the property under S. 16, until it has been set aside". It is pertinent to point out that this observation takes into account S. 16 also. That section refers to the taking of possession. The observation means that when an award is followed by taking of possession, title passes. It is the failure to take into account this crucial factor, that has led the Subordinate Judge to pass the decree that be did in favour of the plaintiff. In our opinion, since no title has passed to the Devaswom, the plaintiff cannot obtain any relief out of the compensation amount fixed in the award, for the acquisition. Relief could be obtained in damages if the necessary application there for under the provisions of S. 48 of the Land Acquisition Act or S. 34 of the Travancore Land Acquisition Regulation had been made and that too within the time allowed by law. But this the plaintiff had failed to do.

The learned Subordinate Judge observed in the course of his judgment that possession was taken in this case in a disguised manner. He observed that the devaswom department colluded with the creditors and manoeuvred to purchase the property for a very low price. But there is no plea and no evidence to support this adverse criticism. Only the plaintiff gave evidence on his side. He was a very young boy at the time when the acquisition proceedings and execution proceedings were undertaken. He had no personal knowledge of any of these proceedings. We are unable to find any basis for the observation of the Subordinate Judge that possession had been taken in a disguised manner. The execution sales were duly proclaimed and delivery of possession of the property sold was taken through court. There was nothing clandestine about it. We also note that the decision to withdraw from the acquisition, contained is B-11, dated 15th March, 1929, was taken before the court sales were held. Therefore, we cannot also find any mala fides in the decision to withdraw from the land acquisition proceedings. No doubt, there was a delay of about a year from the date of the award to the date of the request for withdrawal. In the normal course one would expect possession of the properly to be taken soon after the award. It is possible that the devaswom authorities knew of the claims of creditors and of the suits filed by them and they might have takes time to decide whether to proceed with the acquisition proceedings or to find out the result of the execution proceedings. They seem to have elected to withdraw from the acquisition and take their chance of bidding and securing the properties in execution proceedings. This was a course which was legally open to them. They thought that this would be more advantageous considering that the amount of compensation fixed in the award, in their opinion, was very high. But, for the above reasons, it will not be proper to infer mala fides on the part of the authorities of the Devaswom, especially when there is no plea or evidence for supporting such an allegation. As mentioned already, if the long interval from the date of the award to the date of withdrawal from the acquisition had prejudiced the plaintiff, his proper remedy would be by way of a claim for damages under the appropriate provisions of the Land Acquisition Act, or even by an Independent suit, if so advised. But we find no basis at all on which the claim for compensation amount determined under the award could be legally sustained. We are, therefore, of the opinion the Appeal by the State has to succeed A. S. No. 209 of 1963 is allowed. A. S. No. 301 of 1963 is filed by the Devas worn department (second defendant, against the same decision. Learned counsel for the appellant herein adopts the arguments of the appellants in A. S. No. 209 of 1963. Therefore A. S. No. 301 of 1963 is also allowed. The decree of the lower court is set aside and the plaintiff''s suit is dismissed. Costs in the appeals one set. The plaintiff roust pay the Court fee due to Government on the plaint.