# 5 S.C.R. 365 RAJASTHAN HOUSING BOARD v. NEW PINK CITY NIRMAN SAHKARI SAMITI LTD. &ANR

- **Citation:** [2015] 5 S.C.R. 365
- **Court:** Supreme Court of India
- **Decided:** 2015-05-01
- **Case number:** Civil Appeal Nos.1527-1536 of 2013
- **Bench:** H.L. Dattu, A.K. Sikri, Arun Mishra
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/5-s-c-r-365-rajasthan-housing-board-v-new-pink-city-nirman-sahkari-samiti-ltd-30763
- **Pages:** 59

## Headnote

Rajasthan Land Acquisition Act, 1953 - s. 4 -
A
B
c
Acquisition of Land - Of the Khatedars who belonged to
Scheduled Caste - Objection to acquisition by Housing
Society claiming to have entered into agreement for sale with
the Khatedars in respect of the land in question - Objection D
rejected-Award in favour of the Khatedars- Thereafter the
Society filed suit against the Khatedars for specific
performance of the agreement of sale and obtained decree
in its favour- Reference u/s. 18 by a Khatedar as well as the
Housing Society -
Civil Court answered the reference E
determining the compensation@ Rs. 260 per sq. yd. - Single
Judge of High Court reduced the compensation to Rs. 1001per sq. yd. - Order of Single Judge affirmed by Division
Bench of High Court- In addition, Division Bench relying on
Notification dated 27-10-2005 directed grant of 25% of the F
developed land to .the Housing Society - On appeal, held:
The sale in favour of the Society (a juristic person) by the
Khatedars, being not permissible uls. 42 of Rajasthan
Tenancy Act was void ab initio - Decree obtained on the basis G
of the agreement was violative of the mandate of s. 42 of the
Tenancy Act and thus was a nullity- Therefore, the Housing
Society was not entitled to compensation - The khatedars
alone were the rightful claimants - Failure on the part of the
H
365
366
SUPREME COURT REPORTS
[2015] 5 S.C.R.
A Khatedars to take recourse to provisions of s. 175 of the
Tenancy Act is inconsequential in the facts of the present
case - The circular dated 27-10-2005 did not confer any right
eithe~r on the Society or the Khatedars to claim the developed
land as the same is not applicable in the present case - The
B determination of compensation @ Rs 1001- per sq. yd. is
justified - Rajasthan Tenancy Act, 1955 - ss. 42 and 175 -
Notification dated 27-10-2005- Constitution of India, 1950
-Art. 341and342.
C
Limitation -Award under Land Acquisition Act passed
in the year 1982 - Reference uls. 18 of the Act made in the
year 1989- By the society claiming itself to be the purchaser
of the land - Whether such reference barred by limitation -
0 Held: In view of the conjoint reading of s. 12(2) and 18(2) of
the Act, the reference was not time barred- Rajasthan Land
Acquisition Act, 1953- ss. 12(2) and 18(2).
E
Words and Phrases- 'Constructive notice' - Meaning
of- Discussed.
Disposing of the appeal, the Court
HELD: 1.1 Section 12(2) of the Rajasthan Land
Acquisition Act, 1953, requires immediate notice to be
F given of the award to such of the persons in~erested as
are not present personally or by their representative/s
when the award is made. Section 18(2) of the Act of 1953
requires to file the objections within six weeks from the
date of the award if the person or the representative was
G present when the award was made. In other cases,
within six weeks of the receipt of notice from the Collector
under section 12(2) or within six months from the date
of the award whichever period shall first expire. In the
H instant case, notice under section 12(2) was issued to
RAJASTHAN HOUSING BOARD v. NEW PINK CITY
367
NIRMAN SAHKARI SAMITI LTD.
the Society by the Special Officer on 31.12.1988, treating A
the Society as 'person interested' and informing that an
award had been passed on 30.11.1982. [Para 13 and 14]
[382-C-F]
1.2 In the instant case, it is apparent that the B
Housing Society had preferred objections and was
aware of the land acquisition process and determination
of compensation and has filed objections which stood
rejected on 4.9.1982. Thus, the constructive knowledge
of the award is fairly attributable to it when it was so C
passed. Constructive notice in legal fiction signifies that
the individual person should know as a reasonable
person would have. Even if they have no actual
knowledge of it. Constructive notice means a man ought D
to have known a fact. A person is said to have notice of a
fact when he actually knows a fact but for wilful
abstension from inquiry or search

## Text

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(2015) 5 S.C.R. 365
RAJASTHAN HOUSING BOARD
v.
NEW PINK CITY NIRMAN SAHKARI SAMITI LTD. &ANR.
Civil Appeal Nos.1527-1536 of 2013
MAY 1, 2015
[H.L. DATTU, CJI, A.K. SIKRI AND ARUN MISHRA, JJ.]
Rajasthan Land Acquisition Act, 1953 - s. 4 -
A
B
c
Acquisition of Land - Of the Khatedars who belonged to
Scheduled Caste - Objection to acquisition by Housing
Society claiming to have entered into agreement for sale with
the Khatedars in respect of the land in question - Objection D
rejected-Award in favour of the Khatedars- Thereafter the
Society filed suit against the Khatedars for specific
performance of the agreement of sale and obtained decree
in its favour- Reference u/s. 18 by a Khatedar as well as the
Housing Society -
Civil Court answered the reference E
determining the compensation@ Rs. 260 per sq. yd. - Single
Judge of High Court reduced the compensation to Rs. 1001per sq. yd. - Order of Single Judge affirmed by Division
Bench of High Court- In addition, Division Bench relying on
Notification dated 27-10-2005 directed grant of 25% of the F
developed land to .the Housing Society - On appeal, held:
The sale in favour of the Society (a juristic person) by the
Khatedars, being not permissible uls. 42 of Rajasthan
Tenancy Act was void ab initio - Decree obtained on the basis G
of the agreement was violative of the mandate of s. 42 of the
Tenancy Act and thus was a nullity- Therefore, the Housing
Society was not entitled to compensation - The khatedars
alone were the rightful claimants - Failure on the part of the
H
365
366
SUPREME COURT REPORTS
[2015] 5 S.C.R.
A Khatedars to take recourse to provisions of s. 175 of the
Tenancy Act is inconsequential in the facts of the present
case - The circular dated 27-10-2005 did not confer any right
eithe~r on the Society or the Khatedars to claim the developed
land as the same is not applicable in the present case - The
B determination of compensation @ Rs 1001- per sq. yd. is
justified - Rajasthan Tenancy Act, 1955 - ss. 42 and 175 -
Notification dated 27-10-2005- Constitution of India, 1950
-Art. 341and342.
C
Limitation -Award under Land Acquisition Act passed
in the year 1982 - Reference uls. 18 of the Act made in the
year 1989- By the society claiming itself to be the purchaser
of the land - Whether such reference barred by limitation -
0 Held: In view of the conjoint reading of s. 12(2) and 18(2) of
the Act, the reference was not time barred- Rajasthan Land
Acquisition Act, 1953- ss. 12(2) and 18(2).
E
Words and Phrases- 'Constructive notice' - Meaning
of- Discussed.
Disposing of the appeal, the Court
HELD: 1.1 Section 12(2) of the Rajasthan Land
Acquisition Act, 1953, requires immediate notice to be
F given of the award to such of the persons in~erested as
are not present personally or by their representative/s
when the award is made. Section 18(2) of the Act of 1953
requires to file the objections within six weeks from the
date of the award if the person or the representative was
G present when the award was made. In other cases,
within six weeks of the receipt of notice from the Collector
under section 12(2) or within six months from the date
of the award whichever period shall first expire. In the
H instant case, notice under section 12(2) was issued to
RAJASTHAN HOUSING BOARD v. NEW PINK CITY
367
NIRMAN SAHKARI SAMITI LTD.
the Society by the Special Officer on 31.12.1988, treating A
the Society as 'person interested' and informing that an
award had been passed on 30.11.1982. [Para 13 and 14]
[382-C-F]
1.2 In the instant case, it is apparent that the B
Housing Society had preferred objections and was
aware of the land acquisition process and determination
of compensation and has filed objections which stood
rejected on 4.9.1982. Thus, the constructive knowledge
of the award is fairly attributable to it when it was so C
passed. Constructive notice in legal fiction signifies that
the individual person should know as a reasonable
person would have. Even if they have no actual
knowledge of it. Constructive notice means a man ought D
to have known a fact. A person is said to have notice of a
fact when he actually knows a fact but for wilful
abstension from inquiry or search which he ought to
have made, or gross negligence he would have known
it. Constructive notice is a notice inferred by law, as E
distinguished from actual or formal notice; that which is
held by law to amount to notice. [Para 17][385-H; 386-A·
CJ
1.3 It is also apparent that the Society had actively F
participated in the other pending cases with respect to
determination of compensation in which award had been
passed on 2.1.1989. Thus the reference sought on the
strength of the notice under section 12(2) issued and
received on 31.12.1988 would not provide limitation to G
the Society for seeking reference with respect to the four
cases In which the award was passed on 30.11.1982 as
notice to it was wholly unnecessary in view of rejection
of its objection on the ground that it was not having right,
l1tle or Interest in the land. Thus It could not be said to be H
368
SUPREME COURT REPORTS
(2015] 5 S.C.R.
A 'person interested' in view of the order dated 4.9.1982.
Thus, in view of the conjoint reading of sections 12(2)
and 18(2) of the Rajasthan Land Acquisition Act, it was
not open to the LAO to refer the case to the civil court on
the basis of the time barred application. [Para 18] [386B D-H]
c
Madan & Anr. v. State of Maharashtra (2014) 2 SCC
720: 2013 (12) SCR 761; Raja Harish Chandra Raj
Singh v. The Deputy Land Acquisition Officer & Anr.
AIR 1961 SC 1500: 1962 SCR 676; Muthia Chettiar
v. Commissioner of Income Tax, Madras [AIR 1951
Mad. 204] - referred to.
2.1 The original Khatedars are 'Bairwa' by caste
D which is a Scheduled Caste and they are entitled to the
protection of the provisions contained in section 42 of
the Rajasthan Tenancy Act. The provisions of section
42 declare the transaction entered into by a Scheduled
Caste with any person other than a person of a
E Scheduled Caste or by a Scheduled Tribe with any other
tribe to be void. The so-called agreements dated
15.2.197 4, 17 .2.197 4, 21.2.197 4 and 21.2.1976 which were
purportedly entered into by the Society with the
F Khatedars were thus clearly void as per the mandate of
section 42. The notification in the instant case u/s. 4 was
issued on 12.1.1982. The plea of part-performance under
section 53A of Transfer of Property Act was also not
available to the Society as transaction is void. [Para 19,
G 20 and 21] [388-8-C, H; 389-A-B]
2.2 It is not correct that since the Society is a
juristic person, sale cannot be said to be in contravention
of section 42 of the Rajasthan Tenancy Act. 'Sale' is
H permitted by a person of Scheduled Caste to another
RAJASTHAN HOUSING BOARD v. NEW PINK CITY
369
NIRMAN SAHKARI SAMIT! LTD.
person of Scheduled Caste. The Society cannot be said A
to be a person of 'Scheduled Caste'. The Society cannot
be said to be a person included in the notification issued
under Article 341 of the Constitution of India. Article 341
of the Constitution envisages notification to be issued
for inclusion of Scheduled Caste in relation to a State or B
Union Territory. The sale to the Society which is a juristic
person is ab initio void and not recognisable in the eye
of law. [Para 22] [389-C-D; 390-E]
State of Rajasthan & Ors. v. Aanjaney Organic Herbal
C
Pvt. Ltd. (2012) 10 sec 283: 2012 (7) SCR 1148;
Manchegowda & Ors. v. State of Kamataka & Ors.
(1984) 3 SCC 301: 1984 (3) SCR 502 - relied on
2.3 In the instant case, the transaction is ab initio D
void that is right from its inception and is not voidable at
the volition by virtue of the specific language used in
section 42 of the Rajasthan Tenancy Act. There is
declaration that such transaction of sale of holding "shall
be void". As the provision is declaratory, no further E
declaration is required to declare prohibited transaction
a nullity. No right accrues to a person on the basis of
such a transaction. The person who enters into an
agreement to purchase the same, is aware of the F
consequences of the provision carved out in order to
protect weaker sections of Scheduled Castes and
Scheduled Tribes. The right to claim compensation
accrues from right, title or interest in the land. When such
right, title or interest in land is inalienable to non-SC/ST, G
obviously the agreements entered into by the Society
with the Khatedars are clearly void and decrees obtained
on the basis of the agreement are violative of the mandate
. of section 42 of the Rajasthan Tenancy Act and are a
nullity. Such a prohibited transaction opposed to public H
370
SUPREME COURT REPORTS
[2015] 5 S.C.R.
A policy, cannot be enforced. Any other interpretation
would be defeasive of the very intent and protection
carved out under section 42 as per the mandate of Article
46 of the Constitution, in favour of the poor castes and
downtrodden persons, included in the Schedules to
B Articles 341 and 342 of the Constitution of India. [Para
25] [394-C-H]
State of Madhya Pradesh v. Babu Lal & Ors. 1977 (2)
SCC 435; Lineal Gamango & Ors. v. Dayanidhi Jena
C
& Ors. AIR 2004 SC 3457: 2004 (2) Suppl. SCR 825;
Amrendra Pratap Singh v. Tej Bahadur Prajapati & Ors.
AIR 2004 SC 3782 - relied on.
3. The right to claim compensation cannot be
D enforced by the Society on the basis of such transaction
as that would defeat the very object of the Act and the
constitutional provisions including such castes and
tribes under the protective umbrella of the Schedules to
Articles 341 and 342, they cannot be deprived of right to
E obtain the compensation of the land legally held by them
and they cannot be made to fall prey to unscrupulous
devices of land grabbers. The right to claim
compensation is based on right, title or interest in the
F land, cannot be transferred by virtue of the mandate of
section 42 to a juristic person like the Society. It is the
duty of the State to ensure that the benefit reaches to
such persons directly and not usurped by intermeddlers
as what is intended by the protection of the right to hold
G property of SC/ST, cannot be taken away by disbursing
the compensation to Society. Persons of SC/ST, as the
case may be, are the only rightful claimants to disbursal
of compensation and such right cannot be tinkered with
by void transaction as the purpose of compensation Is
H
RAJASTHAN HOUSING BOARD v. NEW PINK CITY
371
NIRMAN SAHKARI SAMITI LTD .
. the re-settlement of Scheduled Castes or tribes. [Para A
30] [399-A-E]
Himalayan Tiles and Marble (P) Ltd. v. Francis Victor
Coutinho (dead) by LRs. 1980 (3) SCC 223: 1980 (3)
SCR 235 - held inapplicable.
B
U.P. Jal Nigam, Lucknow through its Chairman & Anr.
v. Kalra Properties (P) Ltd., Lucknow & Ors. 1996 (3)
SCC 124: 1996 (1) SCR 683; II. Chandrasekaran &
Anr. v. Administrative Officer& Ors. 2012 (12) SCC 133:
C
2012 (10) SCR 603; Dossibai Nanabhoy Jeejeebhoy
v. P.M.Bharucha 1958 (60) Born.LR 1208 - referred
to
4. It cannot be said that having failed to take D
recourse to the provisions of section 175 of the
Rajasthan Tenancy Act, the Khatedars have lost their
remedy for ignoring the title acquired by the Society
which has been perfected by the compromise decrees
passed by the civil court. In the instant case, there is no E
question of initiating the process under section 175 of
the Rajasthan Tenancy Act as much before passing of
the decrees by the civil court in the year 1986, possession
had been taken by the State in May, 1982 much before
limitation lapsed. Thus, institution of proceedings for F
ejectment was not warranted. Apart from that, voidity of
the transaction can be looked into in the present
proceedings also when right to claim compensation is
asserted by the Society and from factual conspectus of G
the instant case it is apparent that Khatedars belong to
Scheduled Castes and they cannot be deprived of their
right to claim compensation, intendment of section 42
can be effectuated in these proceedings. [Para 34, 35
and 36] [402-B; 404-A-B, E]
H
372
SUPREME COURT REPORTS
[2015] 5 S.C.R.
A
Ram Karan (dead) through LR & Ors. v. State of
Rajasthan & Ors. 2014 (8) SCC 282- distinguished
B
Nathu Ram (dead) by LRs. & Ors. v. State of Rajasthan
& Ors. 2004 (13) SCC 585 - held inapplicable
5. It is correct that the right to hold property cannot
be taken away except in accordance with the provisions
of the statute, but in the instant case, the right to hold
property albeit had not been acquired by the Society,
c transaction was ab initio void and a nullity. On the other
hand, the land has been acquired by the State
Government and even the right to claim compensation
was denied to the Society in the award passed on
30.11.1982 by rejecting their objections. The recourse to
D section 175 was not required. The question of
entitlement of the Society is involved in the cases in view
of award dated 30.11.1982 rejecting right of the Society
to claim compensation. Thus, it cannot be said that there
is violation of the principles laid down by this Court in
E aforesaid cases with respect to right to hold property
which cannot be taken away except as provided in the
provisions of the statute. [Para 41] [406-H; 407-A-C]
F
G
Lachhman Dass v. Jagat Ram & Ors. 2007 (10) SCC
448: 2007 (2) SCR 980; Tukaram Kana Joshi & Ors.
through Power-of-Attorney holder v. Maharashtra
Industrial Development Corpn. & Ors. 2013 (1) SCC
353: 2012 (13) SCR 29; Rajendra Nagar Adarsh Grah
Nirman Sahkari Samiti Ltd. v. State of Rajasthan & Ors.
2013 (11) SCC 1: 2013 (7) SCR 192-referred to
6.1 The Circular dated 27-10-2005 is applicable in
the matter of land acquisition when the Khatedars
H surrendered their lands. Further, the provisions shall
RAJASTHAN HOUSING BOARD v. NEW PINK CITY
373
NIRMAN SAHKARI SAMITI LTD.
apply in case of future acquisitions and the provisions A
shall not apply where the Land Acquisition Officers have
already passed the award/s. In the instant case, even the
prevalent instructions which have been modified did not
confer any right on the Society or the Khatedars to claim
the developed land. It was not a case of surrender of B
land; thus there was no question of the provisions of
the circular being applied as the circular was in the form
of guidelines for future acquisitions where Khatedars
surrendered their lands and award has not been passed. C
Therefore, the aforesaid circular could not have been
pressed into service by the Society and that too at the
appellate stage before the Division Bench. The Division
Bench has gravely erred in law while issuing the
aforesaid directions which were wholly unwarranted and D
uncalled for. [Para 44, 45 and 46] [408-E-H; 409-A-B]
Jaipur Development Authority & Ors. v. Vijay Kumar
Data & Anr. 2011 (12) SCC 94: 2011 (7) SCR 242;
Jaipur Development Authority & Ors. v. Radhey Sh yam
E
1994 (4) SCC 370: 1994 (2) SCR 1; Jaipur
Development Authority v. Dau/at Mal Jain 1997 (1) SCC
35: 1996 (6) Suppl. SCR 584- relied on
6.2 Apart from inapplicability, it is also apparent F
that the very purpose of issuing such circulars is not to
benefit the purchaser who has acquired the right after
issuance of notification under section 4 of Rajasthan
Land Acquisition Act, and in violation of mandate of
section 42. C-onsequently, the High Court had no G
jurisdiction to direct allotment of land. Even Khatedars
were not entitled to such direction/benefit as the circulars
are not applicable in such cases. [Para 52][418-H; 419A]
H
374
SUPREME COURT REPORTS
[2015] 5 S.C.R.
A ·
Harl Ram & Anr. v. State of Haryana & Ors. 2010 (3)
SCC 621: 2010 (2) SCR 756-distinguished
Usha Stud and Agricultural Farms Pvt. Ltd. & Ors. v.
State of Haryana & Ors. 2013 (4) SCC 210: 2013 (5)
B
SCR 645 - held inapplicable
7. Oral evidence can also be taken into
consideration while determining compensation, but in
the facts of the present case, the best evidence is
c documentary evidence which has to prevail. In the face
of the documentary evidence evincing the price of the
land per sq.yd. the oral evidence which was based upon
ipse dixit and without any sound basis, could not have
been accepted by the Reference Court. Thus, the grave
D error which was committed had been rightly set at
naught by the single Bench of the High Court, which
determination of compensation has also not been
interfered by a Division Bench. [Para 57) [421-B-F]
E
F
State of Gujarat & Ors. v. Rama Rana & Ors. 1997 (2)
sec 693:
1996 (10)
Suppl.
scR
102;
Satyanarayana & Ors. v. BhuArjanAdhikari & Ors. 2011
(15) SCC 1.33: 2013 (7) SCR 631; Raman/al
Deochand Shah v. State of Maharashtra & Anr. 2013
(14) SCC 50; State of Gujarat & Ors. v. Rama Rana &
Ors. 1997 (2) sec 693: 1996 (10) Suppl. SCR 102;
Satyanarayana v. BhuArjanAdhikari & Ors. 2011 (15)
sec 133 - referred to
G
8. In order to protect the interest of the Scheduled
Caste persons, it is directed that the Society or other
intermeddler, or power of attorney holder shall not be
paid compensation on their behalf and the Collector/
H Land Acquisition Officer to ensure that the compensation
RAJASTHAN HOUSING BOARD v. NEW PINK CITY
375
NIRMAN SAHKARI SAMITI LTD.
is disbursed directly to the Khatedars or their legal A
representatives, as the case may be, and that they are
not deprived of the same by any unscrupulous devices
of land grabbers etc. [Para 61] [423-C-D]
Case Law Reference
B
2013 (12) SCR 761
referred to
Para 15
1962 SCR 676
referred to
Para 15
AIR 1951 Mad. 204
referred to
Para 16
2012 (7) SCR 1148
relied on
Para 22 c
1984 (3) SCR 502
relied on
Para 23
1977 (2) sec 435
relied on
Para 26
2004(2) Suppl.SCR 825
relied on
Para 27
AIR 2004 SC 3782
relied on
Para 27
D
1996 (1) SCR 683
referred to
Para 29
2012 (10) SCR 603
referred to
Para 31
1958 (60) Born.LR 1208
referred to
Para 32
1980 (3) SCR 235
held inapplicable
Para33
E
2004 (13) sec 585
held inapplicable
Para 36
2014 (8) sec 282
distinguished
Para 37
2007 (2) SCR 980
referred to
Para 38
2012 (13) SCR 29
referred to
Para 39
F
2013 (7) SCR 192
referred to
Para 40
2014 (2) SCR 736
relied on
Para 40
2011 (7) SCR 242
relied on
Para 48
1994 (2) SCR 1
relied on
Para 48
G
1996 (6)Suppl. SCR 584
relied on
Para 49
2010 (2) SCR 756
distinguished
Para 53
2013 (5) SCR 645
held inapplicable
Para 54
H
376
SUPREME COURT REPORTS
[2015] 5 S.C.R.
A 1996 (10) Suppl.SCR 102
referred to
Para 55
2013 (7) SCR 631
referred to
Para 55
2013 (14) sec 50
referred to
Para 55
1996 (10) Suppl.SCR 102
referred to
Para 58
B 2011 (15) sec 133
referred to
Para 59
CIVIL APPELLATE JURISDICTION : CIVILAPPEAL
Nos. 1527-1536of2013
From the Judgment and Order dated 29.10.2009 of the
C High Court of Judicature for Rajasthan at Jaipur Bench, Jaipur
in D. B. Special Appeal (Civil) Nos. 13 of 2001, 55 of 1999,
101, 102, 103, 104, 105, 106, 107 of2000
D
WITH
C.A. Nos. 1537-1546, 1547-1556, 1557-1566, 1567--1576,
1577-1586, 1587-1596, 1597-1606, 1607-1608, 1609-1610,
1611-1612, 1613-1614, 1615-1616, 1617-1618, 1619-1620,
1621-1622, 1623-1624, 1625-1626, 1627-1628, 1629-1630,
E 1631-1632, 1633-1634 of2013 &4183-4192 of2015
Vijay Hansaria, Vikas Singh, R. P. Bhatt, Basava Prabhu
S. Patil, Surya Kant, P. C. Jain,Avnish Pandey, Yunus Malik,
Depaika Kalia, Aman Malik, Prashant Choudhary, Praveen
F Swarup, Shashank Singh, Lakshmi Raman Singh, Sanjeev
Anand, YakeshAnand, Nim it Mathur, Milind Kumar, Yunus Malik,
Kapish Seth, Praveen Swarup for the appearing parties.
G
The Judgment of the Court was delivered by
ARLIN MISHRA, J.
1. Leave granted in SLP [CJ
Nos.21344-21353/2015.
2. The appeals arise out of a common judgment and
H order dated 29.10.2009 passed by a Division Bench of the
RAJASTHAN HOUSING BOARD v. NEW PINK CITY
377
NIRMAN SAHKARI SAMIT! LTD. [ARUN MISHRA, J.]
High Court of Rajasthan in Special Appeal No.13/2001 and A
other connected matters. The Rajasthan Housing Board,
original Khatedars and the New Pink City Housing Construction
Co-operative Society Ltd. (transferee) (hereinafter referred to
as the Society') have assailed the impugned judgment and
order on different grounds. The Rajasthan Housing Board has B
prayed for setting aside direction to consider 25% of developed
land and compensation, whereas the original khatedars have
prayed for payment of compensation to them. Similarly, the
Rajasthan Housing Board has also questioned the entitlement C
of the Society to claim compensation. The Society has also
claimed for more value of land.
3. The State Government issued a notification under
section 4 of the Rajasthan Land Acquisition Act, 1953 (for short D
'the Act of 1953') on 12.1.1982. The land had been acquired
for the purpose of housing scheme of Rajasthan Housing
Board. On 22.5.1982 the possession had been handed over
to Rajasthan Housing Board under section 9 of the Act of 1953.
The Society preferred objections before the Land Acquisition E
Officer (LAO). The objections preferred by the Society were
rejected vide order dated 4.9.1982. Thereafter, Award was
passed with respect to four cases by the LAO on 30.11.1982
in favour of Khatedars. With respect to the remaining cases
the award was passed on 2.1.1989 by the LAO. Notice under F
section 12(2) of the Act of 1953 was issued to the Society with
respect to the award of 30.11.1982 on 31.12.1988.
4. The Society applied for reference under section 18
oftheActof 1953. On 17.4.1989, the reference was made to G
the Civil Court. One of the Khatedars namely Prabhu also
sought reference registered as Case No.43/1989. The Civil
Court answered the reference on 23.1.1994 determining the
compensation at Rs.260 per sq.yd. The objection raised by
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A the Housing Board with respect to the entitlement of Society
under section 42 of the Rajasthan Tenancy Act, was brushed
aside. On appeal to the High Court, the single Bench vide
impugned judgment and order dated 22.3.1999 reduced the
compensation to Rs.100 per sq.yd. The Division Bench has
B not only affirmed the aforesaid award but has additionally
directed to consider allotment of 25% of developed land in
view of circular dated 27.10.2005 in terms of the order passed
by a Division Bench in Special Appeal No.697/1995.
C
5. The Khatedars have claimed that they are 'Bairwa'
by caste which is a Scheduled Caste notified under the
Constitution Scheduled Castes Order, 1950.
6. The Society has claimed that it had entered into an
D agreement to sell with Khatedars of the land on 15.2.197 4,
17.2.1974, 21.2.1974 and 22.1.1976. The Society has also
claimed that it had applied to the Rajasthan Housing Finance
Society Ltd. for financial assistance for construction of houses
and an NOC dated 7.6.1982 was issued to it by the Urban
E Improvement Trust, Jaipur. The Society objected to the
acquisition but objections were rejected on 3.9.1982 in four
cases out of which Reference Case No.1989, 2089, 3089 and
4089 arose. The award was passed on 30.11.1982. Later on,
F the Society appears to have filed a civil suit for specific
performance of agreement to sell in the year 1986 against the
Khatedars and compromise decrees are said to have been
passed on 2.10.1986, 3.10.1986 and 24.1.1988 thereby
decreeing the suit in favour of the Society.
G
7. It was submitted on behalf of the State Government,
Rajasthan Housing Board and also by the Khatedars that the
transactions between the Society and Khatedars, if any, were
ab initio void in view of the provisions contained in section 42
H of the Rajasthan Tenancy Act. Thus, decree obtained on the
RAJASTHAN HOUSING BOARD v. NEW PINK CITY
379
NIRMAN SAHKARI SAMIT! LTD. [ARUN MISHRA, J.]
basis of void transaction is a nullity and no right had accrued A
to the Society to claim compensation.
8. It was urged before us on behalf of the Society that
the compensation determined is inadequate. Oral evidence
has been ignored by the High Court while reducing the quantum B
of compensation determined by Reference Court. The Society
has a right to claim compensation on the basis of the agreement
which has been culminated into a decree passed by the civil
court. No action has been taken by Khatedars to take back
the possession under section 175 of the Rajasthan Tenancy C
Act within the period of limitation of 30 years which is
prescribed therein. The High Court has rightly ordered allotment
of 25% of the developed land to the Society. The Society is a
person interested to receive the compensation on the strength D
of the judgment and decree of civil court. It has developed the
land and has spent certain amount on development and the
right to hold the property cannot be taken away except in
accordance with the provisions of a statute. In order to claim
superior right to hold the property the procedure prescribed in E
a statute must be complied with as provided in Article 300Aof
the Constitution of India. The State is bound to treat various
incumbents similarly as others have been allotted the land. It
is bound to act upon its decision and allot the 25% of the
developed land to the Society. The plea based upon the bar F
created by section 42 of the Rajasthan Tenancy Act has not
been substantiated by adducing the evidence.
9. It was contended on behalf of the Khatedars that
though the civil court's decrees are fraudulent and bogus even G
otherwise the decrees are a nullity and opposed to public policy
on the strength of provisions contained in section 42 of the
Rajasthan Tenancy Act; Transaction being void, the Society
has no locus standi, right, title or interest to claim the enhanced
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[2015] 5 S.C.R.
A compensation; more so, in view of the rejection of its objection
vide order dated 4.9.1982. The award in 1982 was passed by
Land Acquisition Officer in favour of Khatedars. They are
entitled to enhanced compensation and not the Society. The
land was recorded in the names of Khatedars in the revenue
B records. The agreements of 1974 and 1976 have not been
produced and once the transaction is void, it can be questioned
in the instant proceedings. They are entitled to compensation
and also to obtain developed land, as and when allotted.
C
10. It was contended on behalf of the State Government
as well as the Rajasthan Housing Board that the Society is not
entitled to any compensation as such transactions are declared
void by section 42 of the Rajasthan Tenancy Act. The reference
0 sought in the year 1989 with respect to the lands covered by
the award dated 30.11.1982 was clearly barred by limitation.
The objection had been raised before the Reference Court
based upon section 42 of the Rajasthan Tenancy Act and it
has not been disputed at any stage that Khatedars belong to
E "Bairwa" caste which is a Scheduled Caste. Thus, the bar
enacted under section 42 on transfer of such land is clearly
. attracted. The judgments passed by the High Court and the
Reference Court deserve to be set aside. On merits, no case
for enhancement of compensation was made out The Society
F has no right, title or interest in the land. The Division Bench of
the High Court had gravely erred in law in directing allotment
of 25% of the developed land. The prayer made by the Society
for allotment of the developed land was rejected by the
Rajasthan Housing Board on 14.5.2009 and 16.9.2009. The
G said orders were not questioned. Even otherwise the Circulars
dated 13.11.2001 and that of 27.10.2005 are not applicable
and not enforceable as held by this Court. The direction to
allot the developed land deserves to be set aside.
H
11. First, we advert to the question whether reference,
RAJASTHAN HOUSING BOARD v. NEW PINK CITY
381
NIRMAN SAHKARI SAMITI LTD. [ARUN MISHRA, J.]
with respect to the four cases in which award was passed on A
30.11.1982, was within period of limitation. Admittedly,
possession from the Society had been taken on 22.5.1982.
The Society submitted the objections before the LAO on
20.7.1982. While rejecting the objections on 4.9.1982, the
Special Officer, Urban Development Authority, LAO, had B
unilaterally observed that the acquisition cannot be said to be
in violation of the provisions contained in Article 300A of the
Constitution of India, the Society has no ownership of the land,
it has no interest in the land. Thus, it has no right to raise the C
objection. The said order had attained finality and the award
was passed on 30.11.1982. In the award so passed, it has
also been mentioned that an Advocate had appeared on behalf
of the Khatedars and wanted to file objections regarding
compensation. The said Advocate appeared on behalf of some D
of the Khatedars and stated that they had sold the land to the
Society. However, no claim petition was filed on their behalf.
There is also a reference in the award dated 30.11.1982 as to
the objection filed by the Society had been rejected on
4.9.1982. It is apparent from the award that it was passed after E
rejecting the objections raised by the Society in favour of
Khatedars.
12. The provisions of Rajasthan Land Acquisition Act
are in pari materia with the provisions of the Land Acquisition
F
Act, 1894 and section 12 of the Act of 1953 is extracted
hereinbelow :
"12. Award of Collector when to be final.-(1) Such
award shall be filed in the Collector's officer and shall,
G
except as hereinafter provided, be final and conclusive
evidence, as between the Collector and the persons
interested, whether they have respectively appeared
before the Collector or not, of the true area and value of
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[2015] 5 S.C.R.
A
the land, and the apportionment of the compensation
among the persons interested.
(2) The Collector shall give immediate notice of his award
or the amendment thereof to such of the persons
B
interested as are not present personally or by their
representatives when the award or the amendment
thereof is made."
13. Section 12(2) requires immediate notice to be given
c of the award to such of the persons interested as are not
present personally or by their representative/s when the award
is made. Section 18(2) of the Act of 1953 requires to file the
objections within six weeks from the date of the award if the
person or the representative was present when the award was
D made. In other cases, within six weeks of the receipt of notice
from the Collector under section 12(2) or within six months
from the date of the award whichever period shall first expire.
14. In the instant case, notice under section 12(2) was
E issued to the Society by the Special Officer on 31.12.1988,
treating the Society as 'person interested' and informing that
an award had been passed on 30.11.1982 in accordance with
section 11 of the Land Acquisition Act. On the strength of the
aforesaid notices it was urged on behalf of the Society that
F the limitation to seek the reference would commence from the
date of receipt of the notices issued and received on
31.12.1988. The reference sought was within the period of
limitation.
G
15. Reliance has been placed on the decision of this
Court in Madan &Anr. v. State of Maharashtra [(2014) 2 SCC
720] and in Raja Harish Chandra Raj Singh v. The Deputy
Land Acquisition Officer & Anr. [Al R 1961 SC 1500] in which
H it has been laid down that the party must have either actual or
RAJASTHAN HOUSING BOARD v. NEW PINK CITY
383
NIRMAN SAHKARI SAMITI LTD. [ARUN MISHRA, J.]
constructive communication of the order which is an essential A
requirement of fair play and natural justice. The date of award
used in proviso (b) to section 18(2) of the Act must be the date
when the award is either communicated to the party or known
by him either actually or constructively. The award in the said
case was passed on 25.3.1951. Notice of the award was 8
however given to the appellant as required by section 12(2)
on 13.1.1953 by which he received information about making
of the said award. It was observed that it was necessary for
the Collector to give immediate notice of his award under C
section 12(2) of the Act. This Court has laid down in Raja
Harish Chandra (supra) with respect to the knowledge of the
award by a party thus :
"6 ..... The knowledge of the party affected by such a
decision, either actual or constructive, is an essential
element which must be satisfied before the decision can
be brought into force. Thus considered the making of the
award cannot consist merely in the physical act of writing
the award or signing it or even filing it in the office of the
Collector, it must involve the communication of the said
. award to the party concerned either actually or
constructively. If the award is pronounced in the presence
of the party whose rights are affected by it it can be said
to be made when pronounced. If the date for the
pronouncement of the award is communicated to the
party and it is accordingly pronounced on the date
previously announced the award is said to be
communicated to the said party even if the said party is
not actually present on the date of its pronouncement.
Similarly if without notice of the date of its pronouncement
an award is pronounced and a party is not present the
award can be said to be made when it is communicated
to the party later. The knowledge of the party affected by
D
E
F
G
H
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[2015) 5 S.C.R.
A
B
c
D
E
F
G
H
the award, either actual or constructive, being an
essential requirement of fair-play and natural justice the
expression "the date of the award" used in the proviso
must mean the date when the award is either
communicated to the party or is known by him either
actually or constructively. In our opinion, therefore, it would
be unreasonable to construe the words "from the date of
the Collector's award" used in the proviso to s. ~
in a
literal or mechanical way."
16. The decision of the Madras High Court in Muthia
Chettiar v. Commissioner of Income Tax, Madras [AIR 1951
Mad. 204] had been considered and approved by this Court
in Harish Chandra (supra) thus:
"10 It may, however, be pertinent to point out that the
Bombay High Court has taken a somewhat different view
in dealing with the effect of the provision as to limitation
prescribed bys. 33A(2) of the Indian Income-tax Act. This
provision prescribes limitation for an application by an
assessee for the revision of the specified class of orders,
cmd it says that such an application should be made within
one year from the date of the order. It is significant that
while providing for a similar period of limitation
s. ~
specifically lays down that the limitation of sixty
days therein prescribed is to be calculated from the date
on which the order in question is communicated to the
assessee. In other words, in prescribing limitation
s. 33(1)expressly provides forthe commencement of the
period from the date of the communication of the order,
whereas s. 33A(2) does not refer to any such
communication; and naturally the argument was that
communication was irrelevant under s. 33A(2) and
limitation would commence as from the making of the
RAJASTHAN HOUSING BOARD v. NEW PINK CITY
NIRMAN SAHKARI SAMITI LTD. [ARUN MISHRA, J.]
order without reference to its communication. This
argument was rejected by the Bombay High Court and it
was held that it would be a reasonable interpretation to
hold that the making of the order implies notice of the
said order, either actual or constructive, to the party
affected by it. It would not be easy to reconcile this
decision and particularly the reasons given in its support
with the decision of the same High Co1,1rt in the case of
Jehangir Bomanji AIR 1954 Born. 4 t9. The relevant
clause under s. 33A(2) of the Indian Income-tax Act has
also been similarly construed by the Madras High Court
in O.A.0.A.M. Muthia Chettiarv. The Commissioner of
Income-tax, Madras[l.L.R. 1951 Mad. 815.]. "If a person
is given a right to resort to a remedy to get rid of an
adverse order within a prescribed time'', observed
Rajamannar, C.J., "limitation should not be computed
from a date earlier than that on which the party aggrieved
actually knew of the order or had an opportunity of knowing
the order and therefore must be presumed to have the
knowledge of the order". In other words the Madras High
Court has taken thei view that the omission to use the
words "from the date of communication" in s. 33A(2) does
not mean that limitation can start to run against a party
even before the party either knew or should have known
about the said order. In our opinion this conclusion is
obviously right"
385
A
B
c
D
E
F
It is thus clear that either party should have actual
knowledge or constructive notice i.e., should have known about
the said order.
G
17. In the instant case it is apparent that the Housing
Society had preferred objections and was aware of the land
acquisition process and determination of compensation and
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A has filed objections which stood rejected on 4.9.1982. Thus,
the constructive knowledge of the award is fairly attributable
to it when it was so passed. Constructive notice in legal fiction
signifies that the individual person should know as a reasonable
person would have. Even if they have no actual knowledge of
B it. Constructive notice means a man ought to have known a
fact. A person is said to have notice of a fact when he actually
knows a fact but for wilful abstension from inquiry or search
which he ought to have made, or gross negligence he would
C have known_it. Constructive notice is a notice inferred by law,
as distinguished from actual or formal notice; that which is held
by law to amount to notice. The concept of constructive notice
has been upheld by this Court in Harish Chandra (supra).
0
18. It is also apparent that the Society had actively
participated in the other pending cases with respect to
determination of compensation in which award had been
passed on 2.1.1989. Thus the reference sought on the strength
of the notice under section 12(2) issued and received on
E 31.12.1988 would not provide limitation to the Society for
seeking reference with respect to the four cases in which the
award was passed on 30.11.1982 as notice tciit was wholly
unnecessary in view of rejection of its objection on the ground
that it was not having right, title or interest in the land. Thus it
F could not be said to be 'person interested' in view of the order
dated 4.9.1982. The notice was issued for reasons best known
to the Special Officer. It is surprising how and for what reasons
notice was issued after six years. We need not go into this
aspect any further as we are of the opinion that in the facts and
G circumstances, the Society had a constructive notice of the
award dated 30.11.1982. Thus, in view of the conjoint reading
of sections 12(2) and 18(2) of the Rajasthan Land Acquisition
Act, it was not open to the LAO to refer the case to the civil
H court on the basis of the time barred application.
RAJASTHAN HOUSING BOARD v. NEW PINK CITY
387
NIRMAN SAHKARI SAMITI LTD. [ARUN MISHRA, J.]
19. Coming to the question whether in view of section A
42 of the Rajasthan Tenancy Act, the transaction entered into
by the Society with the original Khatedars are void and whether
on that basis, it had a right to maintain the reference and to
claim compensation? The Society is said to have entered into
agreements to sell on 17.2.1974, 21.2.1974 and 21.2.1976. B
These agreements have not been placed on record by the
Society. It was incumbent upon the Society to file these
agreements. Be that as it may. The Society has filed certain
affidavits of Khatedars along with counter affidavits filed by it.
C
In the case of Ram Pyari and others, the affidavits of various
Khatedars have been filed by the Societey in which their caste
has been mentioned as 'Bairwa'. The caste of the original
Khatedars has never been disputed. 'Bairwa' caste is a
Scheduled Caste.