The State of Madras and Another v. V. Srinivasa Ayyangar.

Ayyar J. under the grant of 1757. On 31-12-1863 the Inam Commissioner confirmed the grant of 1757, and issued an inam certificate in respect of the 15/16th portion of the village. The position, therefore, when the Act was passed was that while a 15/16th portion was held by the inamdars under a pre-settiement grant con-firmed by the British Government, the remaining one-sixteenth portion was held under post-settlement grant made by the proprietor of the estate.

The Act came into force on 19-4-1949. Under sec-tion l ( 4) of the Act, certain sections thereof were to come into force at once and the other sections on such date as the Government might by notification appoint in respect of any zamindari; under-tenure, or inam estate. In exercise of the powers conferred by this section, the appellant issued a notification on 22-8-1949 bringing the Act into force as regards tht Ramanathapuram estace from 7-9-1949. Among the villages mentioned as comprised in the Zamindari was "Karuppur (part)" described as an under-tenure.

It is common ground that the part referred to in this notification is the one-sixteenth part, which forms the subject-matter of this appeal.

The respondent who represents the holders of this inam filed the application out of which the present appeal arises, under article 226 of the Constitution for a writ of certiorari quashing the notification dated 22-8-1949 as ultra vires. The ground of attack was that under section 1(3) of the Act, the State had power to notify only what would be estates as defined in section 3(2) of the Madras Estates Land Act, 1908 (Madras Act I of 1908), and that the part of the village of Karuppur included in the notification was not an estate as defined in that section. Section 3(2) of Act I of 1908, so far as is material, is as follows :

1955 "Estate" means-- The State of ( a) any permanentiy settled estate or temporarily Madras and settled zamindari ;

another (b) any portion of such permanently settled

v.

V. Srinivasa estate or temporarily settled zainindari which 1s

A)!Yangar separately registered in the office of the Collector ;

Venkatarama ( c) any unsettled palaiyam or jagir ;

M•' J. ( d) any inam village of which the grant has been

made, confirmed or recognised by the British Gov-ernment, notwithstanding that subsequent to the grant, the village has been partitioned among the grantees or the successors m title of the grantee or grantees.

* * • * ( e) any portion consisting of one or more villages of any of the estates specified above in .clauses (a), (b) and ( c) which is held on a permanent under-tenure".

The contention of the respondent was that as the grant in question related only to a fraction of a village, it could not be notified as an under-tenure, as under section 3(2) ( e) an under-tenure would be an estate only if it related to a whole village or villages. The appellant conceded that the inam in question was not an under-tenure as defined in section 3(2)(e), as it comprised only part of a village, but contended that even though it was not in itself an estate, it vn1s, nevertheless, {Jart of the Zamindari of Ramanatha-puram, being a post-settlement grant of portion of a vilbge comprised therein, and that when that estate was notified, the entiretv of it including the inam i11 question must. vest in the Government under section 3 (b) of the Act. The respondent demurred to this contention. In addition, he raised the further con-tention that even if post-settlement minor inams were within the operation of the Act, they would be protected by section 20 of the Act, which runs as follows:

"20(1) In cases not governed by sections 18 and 19, where, before the notified date, a landholder has created any right in any land (whether by way of lease or otherwise) including rights in any forest, mines dr minerals, quarries, fisheries or ferries, the 19'55 transaction shall be deemed to be valid ; and all rights The Stau of and obligations arising thereunder, on or after the Madras and notified date, shall be enforceable by or against the another v. Government : V. Srinivasa

Provided that the transaction was not void or Ayyangar illegal under any law in force at the time : V enkatarama

Provided further that any such right created on AyyarJ. or after the 1st day of July 1945 shall not be enforce-able against the Government, unless it was created for a period not exceeding one year :

Provided also that where such right was created for a period exceeding one year, unless it relates to the private land of the landholder within the mean-ing of section 3, clause (10), of the Estates Land Act, the Government may, if, in their opinion, it is in the public interest to do so, by notice given to the person concerned, terminate the right with effect from such date as may be specified in the notice, not being earlier than three months from the date thereof".

The argument of the respondent was that a post-settlement minor inam would be a right in land cre-ated by a landholder falling within section 20, that the notification of the estate under section 1(3) would not ipso facto divest the inamdar of his title to the lands, and that he would be entitled to hold them subject to any action that might properly be taken by the State under section 20.

The learned Judges of the Madras High Court agreed with the appellant that post-settlement minor inams fell within the operation of the Act ; but they accepted the contention of the respondent that they were governed by section 20 of the Act. As it was common ground that the State had not proceeded under that section, they held that the notification was ultra vires, and accordingly quashed the same in so far as it related to the inam forming part of Ka-ruppur village. The appellant applied to the High Court for leave to appeal to this Court against this decision, and though the value of the subject-matter was far below the appeaiable limit, the learned Judges granted a certificate under article 133(l)(c) on the 1955 ground that the question involved was one of great The State of public importance. That is how the appeal comes Madras and before us.

anothn Two questions arise for decision in this appeal : (1)

v.

Y. Sriniua.ro Are post-settlement minor inams within the operation bangar of Madras Act XXVI of 1948 ? (2) If they are, are Ymkatarama 41,., they governed by section 20 of the Act ?

J. On the first question, the appellant does not con-

tend that the inam in question is in itself an estate as defined in section 3(2) of the Madras Estates Land Act and liable as such to be notified under the Act. His contention is tllat when the Zamindari of Ramanathapuram was notified-and there is no dis-pute that it was validly notified, as it was a perma-nently settled estate falling within section 3(2) (a) of the Madras Estates Land Act-minor post-settlement inams of lands within the Zamindari would vest in the State as part of the Zamindari under section 3(b) of the Act. Section . 3(b) is, omitting what is not material, as follows :

"With effect on and from the notified date and save as otherwise expressly provided in mis Act, ....... . . . . . . . the entire estate . ... shall stand transferred to the Government and vest in them, free of all encum-brances".

The point for decision is whether post-settlement minor inams are parts of the estate out of which they were granted. If they are, then they will vest in the Government under section 3(b ). If they are not, they will remain unaffected by the notification of the parent estate.

The status of holders of these inams had been the subject of considerable divergence of judicial opinion in the Madras High Court. To appreciate this, reference must be made to the following definition of 'landholder' in section 3(5) of the Madras Estates Land Act:

"Landholcicr" means a person owning an estate or part thereof and includes every person entitled to collect the rents of the whole or any portion of the estate by virtue of any transfer from the owner or his predecessor-in-title or of any order of a competent Court or of any provision of law". 1955 Leaving out the inclusive portion of the definition as The Slate of not relevant to the present question, it will be seen Madras and that owners of parts of an estate would also be land-another v. holders. The question then arose for decision whether V. Srinivasa darmi!a minor inamdars were landholders as defined Ayyangar in section 3(5). of the Estates Land Act. If they were, Venkatarama the tenants would acquire occupancy rights under Ayyar J. section 6, and proceedings against them could be taken only in the revenue courts and not in the civil courts, and in general, the rights and obligations of the inamdar and the tenants would be governed by the provisions of the Madras Estates Land Act. One view was that as the inamdars had to pay quit rent or jodi to the grantors, their, status could not be that of owners and therefore they could not be said to own parts of an estate. The contrary view was that the inamdars were in substance owners of the lands granted to them, and that the liability to make a fixed annual payment did not detract from their character as owners, and they would be landholders · owning parts of an estate. In view of this conflict of opinion, the question was referred to the decision of a Full Bench in Brahmayya v. Achiraju(t ), which held by a majority that minor darmila inamdars were land-holders as defined in section 3(5) of the Estates Land Act. This decision was based both on the ground that the inamdars were in the position of owners of parts of an estate and that they were also persons en-titled to collect rent, within the inclusive portion of the definition. · ·

In Narayanaraju v. Suryanarayudu( 2 the question ), whether the grantee of a portion of a village subse-quent to the settlement was a landholder as defined in section 3(5) came up for decision before the Privy Council. After reviewing the authorities and the con-flicting views expressed therein, the Board agreed with the opinion expressed by the majority of the learned Judges in Brahmayya v. Achiraju( 1 and held that the ), grantee of a post-settlement minor inam would be a landholder on both the grounds mentioned in their

(!I [1922] I.L.R. 45 Mad. 716. (2) [1939] 66 I.A. 278.

1955 judgments. They discarded "the doctrine that so TM StaJe of long as the zamindar reserves any mterest, however Madras and insignificant, the permanent grantee from him cannot

another be the owner'', and observed that the words "part of

v.

V. Srinivasa the estate" occurring in the definition must be given Ayyangar their prima facie meaning. The Board felt greater Venkatarama difficulty in accepting the view that the inamdar was Ayyar ]. a landholder entitled to collect rent within the inclu-

sive portion of the definition. But they expressed themselves satisfied on either ground that "the Full Bench decision of 1922 represents a careful and reasonable solution of a stubborn ambiguity in the Act, and that it ought not now to be overruled having regard to the time which has elapsed and to the cha-racter of the interests affected thereby". Thus, it was settled law in Madras at the time when Act XXVI of 1948 was passed that minor darmila inamdars were owners of parts of an estate. Construing section 3(b) in the light of the law as then accepted, when a notified estate vests in its entirety in the State under that prov1S1on, a minor darmila inam which forms part of it must also vest in it.

Sri R. Kesava Ivengar learned counsel for the respondent, argued that decis;ons on section 3(5) ot the Madras Estates Land Act on the meaning of the word 'landholder' as defined therein, could not he usefully referred to for construing the true scope of section 3(b) of Act XXVI of 1948, as the definition in the Madras Estates Land Act was only for pur-poses of settling the right5 of landlords and tenants, and would be irrelevant for determining the rights of the inamdar as aga;nst the State. But the ground of the decision in Bralzmayya v. Ac!ii•·aju(') and Nara-yanaraju v. Suryanarayudu(') is that the grantee of the inam is in the position of an owner of the part of the estate granted to him, and that would be rele-vant when the controversy is as to his true status, whether the dispute is between the landlord and the tenant or between the inamdar and the State. If the inamdar is owner in relation to his tenants, it would be illogical to hold that he is not that, in relation to the State. The question is, in our opinion, concluded by section 2(8) of Act XXVI of 1948 which defines a The State of landholder as including a darmila inamdar, and that Madras and another is a statutory recognition of the doctrine laid down v. in Brahmayya v. Achiraju (1) and Narayanaraju v. V. Srinivasa Ayyangar Suryanarayudu(2) that darmila inamdars are owners of parts of an estate. The result then is that when VenkataramQ the <larmila inam does not relate to the entire village ,4.yyar ]. but only to a fraction of it, it must be held to retain its character as part of the estate in the hands of the inam<lar, and when the estate is notified under section 1 ( 4) of the Act, the inam will vest in the State under section 3(b).

It is next argued for the respondent that the Act makes no provision for award of compensation to minor darmila inamdars, and that as a statute is not to be construed as taking away the property of any person unless there is a provision for payment of compensation therefor, these inams should be held to be outside the operation of the Act. Reference was made in this connection to section 45 of the Act under which the compensation payable in respect of an impartible estate-and Ramanathapuram is one-is to be apportioned dfter payment of debts among the members of the family. It is said that under this section the respondent would have no right to share in it. This contention is clearly erroneous. The mate-rial provisions relating to the award of compensation are sections 25, 27, 37 and 44. Under section 25, the compensation is to be determined for the estate as a whole and not separately for each of the interests therein. Section 27 lavs down how the basic income in the case: of zamindari.s is to be fixed. Under section 27(i), it has to include one-third of the gross annual ryotwari demand in respect of all lands in the estate, and under section 27(iv) "one-third of the average net annual miscellaneous revenue derived from all other sources in the estate specified in section 3 (b) ".

Thus, the income from the lands comprised in the minor inam which is a part of the estate is included in the total income of the zamindari. Under section

(I) [1922] I.L.R. 45 Mad. 716. (2) [1939] 66 I.A. 278.

1955 37, the compensation payable in respect of an estate The State of is calculated in terms of the basic income on the scale Madras and prescribed therein: Section 44 enacts that the Tribu-

another nal is to "apportion this compensation among the

v.

Y. Srinivasa principal landholder and any other persons whose Ayyangllf' rights or interests in the estate stand transferred to Yenkatarama the Government' under section 3(b )". There cannot Ayyar ], be any doubt on . these provisions that the darmila

minor inamdar is a person who is entitled to claim compensation for the transfer of his portion of the estate to the Government. Then comes section 45 on which the respondent bases his contention. That applies only to the distribution of the com-pensation determined under section 44 as pay-able to the principal landholder, when he is the holder of an impartible estate. It leaves untouched the rights of minor darmila inamdars to claim compensa-tion under section 44. The contention of the respon-dent that the Act provides no compensation to them, and that they should therefore be held to fall outside the Act must accordingly be rejected. · (2) That brings us on to the second question whe-ther a post-settlement minor inam is a right in land created by a landholder within the intendment of section 20 of the Act. At the very outset, it seems somewhat inconsistent to hold that a darmila minor inam is patt of an estate, and also that it is governed by section 20. If it is part of an estate, it must automatically vest in the Government under section 3(b ). But if it falls within section 20, the title to it will continue to stand in the inamdar with a right in the. Government to take action under-the third proviso, subject to the conditions laid down therein. It was argued for the respondent that section 3 operates on its own terms only "save as otherwise expressly pro-vided herein", and that section 20 was such a pro-v1s10n. It is somewhat difficult to follow this argu-ment, because if section 20 applied to darmila minor inams, then they could never fall within the opera-tion of section 3'(b ). And how is . this result to be reconciled with the conclusion that they are parts of the estate, and that the inamdar is a landholder for 1955 purposes of the Act ? The State of

But it is argued for the respondent that the words Madras and another "rights in land created by landlord" are of the widest v. import and would take in d;irmila minor inams. The V. Srinfoasa Ayyangar point for decision is whether this contention is correct.

We start with this that a darmila minor inamdar is Venkatarama Ayyar J. a landholder as defined in section 2(8) of the Act, and he is that, by reason of his being the owner of a part of the estate. Can such a person be held to be one who has obtained a right in the land from the landholder within section 20 ? The Act makes a clear distinction between estates held by landholders and rights and interests held by other persons in or over estates. Section 3(b) enacts that when there is a notification under section 1 ( 4), the entire estate shall stand transferred to the Government and vest in it.

We have held that the part of the estate belonging to a darmila inamdar would vest in the Government.

Section 3 ( c) provides that on notification all rights in or over the estate shall cease and terminate. Sec-tion 3(b) and section 3(c) deal with two distinct matters which may respectively be described in broad terms as ownership of the estate and rights in or over estate not amountir.g to ownership, and these two categqries are mutually exclusive. Now, turning to section 20, it protects rights in land by way of lease or otherwise created by the landholder before the notified date. In this context, and having regard to the distinction between estates under section 3 (b) and rights over estates under section 3 ( c), the rights mentioned in section 20 can only refer to the rights dealt with in section 3(c), and not to ownership which is within section 3 (b). When, therefore, the transac-tion for which protection is claimed under section 20 is one which vests ownership of the estate or a por-tion thereof in the transferee, it will fall outside the section. In other words, section 20 has no applica-tion to transactions by which a person becomes a lanr1holder by reason of ownership of even a part of the estate being transferred to him, and that being the character of a darmila minor inam it is not pro-1955 tected by section 20.

The State of There are also indications in the language of sec- \1.adras and tion 20 pointing to the same conclusion. Section 20(2) another provides that the persons whose rights are termi-

v.

V. Srinivasa nated under the proviso to section 20(1) shall be

Ayyangar entitled to compensation having regard to the value Venkatarama of the right which is terminated and the unexpired Ayyar ]. portion of the period for which the right is created.

These words are more appropriate to connote rights which are to be exercised for specified periods, such as lease or contract for the exploitation of mines or forests for a term than "ownership of the estate".

There is one other consideration, which lends sup-port to this conclusion. The object of the Act was to establish direct relationship between the State and the tillers of the soil, and to abolish all intermediate tenures. In Madras, the rights and obligations of intermediate tenure holders were regulated by the Madras Estates Land Act, and under that Act the intermediaries consisted not merely of the holders .of the estates as defined in section 3(2) of that Act but also holders of post-settlement minor inams as settled by decisions of the highest authority. If the purpose of the Act is to be fully achieved, it would be neces-sary to abolish not merely estates as defined in section 3(2) of the Madras Estates Land Act but also darmila minor inams. But jf the co11tention of the respondent is to be accepted, it is only the estates mentioned in section 3(2) that will, on notification, vest in the Government and not the minor i nams. These will continue to be held by the inamdars under section 20 until they are terminated in accordance with the proviso tl1erein, and surv~ve as islets in the landscape even after the parent estates have .dis-appeared from the scene. The legislation must to this extent be held to have failed to achieve its purpose. And this is not all. If the contention of the respon-dent is correct, then the minor inamdars will not mere! y be unaffected by the Act but will actually be better off for it. Under section 3 (a) of the Act, the Madras Estates Land Act stands repealed on and from the notified date, and as it is by virtue of this Act that the tenants became entitled to occupancy 1955 rights, the inamdars would, on notification, be free to Thi Stat• of eject tenants. and settll:'. their own terms with them. Madras and

cannot accede to a contention which results not anothu \Ne v. merely in the frustration of the object of the Act but V. Srinivcstt further produces consequences, the reverse of what Ayyangar were intended. On the other hand, the contention of Vmkatarama the appellant that minor inams fall outside section 20 Ayyar]. and would vest straightaway in the State under sec-tion 3 (b) will have the effect of extinguishing the rights of the inamdars, and enabling the State to issue ryotwari pattas to the tenants in oceupation. We prefer to accept this contention, as it fully effectuates the intention of the legislature. In the result, we must hold that the one-sixteenth portion of the village of Karuppur forming a darmila inam will vest in the Government under section 3 (b) of the Act, and that the only right of the inamdars is to share in the com-pensation under the terms of the Act. The petition of the respondent in so far as it relates to this inam must be dismissed.

This appeal is accordingly allowed, and in accord-ance wit~1 the terms of the certificate granting leave, the appellant will pay the costs of the respondent in this Court. The parties will be:.ir their own costs in the court below.

ANANDA BEHERA AND ANOTHER 1955

v. Octob., 2 7.

THE STATE OF ORISSA AND ANOTHER

[S. R. DAs, AcnNG C. J., VIVIAN BosE, ]AGAN-

NADHADAS, JAFF.R IM.'\M and CHANDRASEKHARA

AIYAR JJ.]

Ft;ndamental Rights, Enforcement of-Oral sale of fishery rights for future years by owner of estate before it vested in the State by legis-lation-Nature of such rights-Profit a prendre, if immovable pro-perty requiring registered imtrument for transfer-Such sale, if cre-ates any right to property-Non-recognition by the State, if trans-gresses any fundamental 1·ights-Constitution of India, Arts. 19(1) (/), 31(1)-0rissa Estates Abolition Act, 1951 (Orissa Act I of 1952) -Transfer of Property Act (IV of 1882), s. 54.