# GANGA DEVI & ORS. ETC v. STATE OF U.P

- **Citation:** [1972] 3 S.C.R. 431
- **Court:** Supreme Court of India
- **Decided:** 1972-02-11
- **Case number:** Civil Appeals Nos. 41 to 46 of 1967
- **Bench:** A. N. Ray Anp M. H. Beg
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/ganga-devi-ors-etc-v-state-of-u-p-5557
- **Pages:** 6

## Headnote

431
U.P. Zamindari Abolition.and La11<I Reforms Act, 1950, s. 39(l)(e)
(i) and (ii)-A.verage annual income how deterniined-Fortst inco1ne.
ij includes income dtrived by processing wood.
The forests of the appellants vested in the respondent-State as a result
<>f the notification μnder the U.P. Zamindari Abolition and Land Reforms
Act, 1950, and the Compensation Officer determined the basis of compensation.
Jn appeal by the respondent the High Court held that the Compen·
sation Officer in determining the compensation was wrong in arriving at
the average annual income by adding the annual income, under s. 39( I)
( e )( i) on the basis of a period of 25 years and the appraioemtnt of
the annual yield, under s. 39(1)(e)(ii), on the date of vesting.
Jn appeals to this Court,
HELD : ( 1) The High C.ourt was correct in holding that the average
annual income from forest under s. 39(1)(e) of the Act cm.Id not be
computed by arithmetical addition of the figures arrived at on the basis
of cl. ( i) and on the ba,is of cl. (ii). The section ,,,,,.xi of computa·
ti0n of average annual income from forest, (i) on t1'c basis of ioc<;ime
for a period of 20 to 40 agricultural years immedialely ,-ding the
date of vesting as the Compensation Officer may consider rca!OflabJe.
and (ii) on the appraisement of the annual yield of the forest on the
date of vesting.
Under the first clause. the actual income derived from
the forest for a number of years before the date of vesting as the Compensation Officer may consider reasonable is to be taken and the average
calculated.
Under the second clause the annual yield as on the date of
vesting is to be appraised. This should be done, Inter alia. by taking
ihto considetation the num'Oer and age of trees, the area pf cultivation
and the produce. Therefore. the compensation officer has to compute
the 'average annual income' by taking recourse to both the iPethods
but not by adding the figures on the basis of cl. (i) and on tlic.,h!ll of
ct (ii l [435 D·H; 436 A-BJ
'
(2) The High Court rightly held that forest income was reftnhlc lo
price of the standing timber. Hence any income which the appenants
derived by processing wood, was income in the nature of trade and
would not be forest income. [436 E-GJ

## Text

A
B
c
D
E
F
G
H
GANGA DEVI & ORS. ETC.
v.
STATE OF U.P.
February 11, 1972
[A. N. RAY ANP M. H. BEG, JJ.]
431
U.P. Zamindari Abolition.and La11<I Reforms Act, 1950, s. 39(l)(e)
(i) and (ii)-A.verage annual income how deterniined-Fortst inco1ne.
ij includes income dtrived by processing wood.
The forests of the appellants vested in the respondent-State as a result
<>f the notification μnder the U.P. Zamindari Abolition and Land Reforms
Act, 1950, and the Compensation Officer determined the basis of compensation.
Jn appeal by the respondent the High Court held that the Compen·
sation Officer in determining the compensation was wrong in arriving at
the average annual income by adding the annual income, under s. 39( I)
( e )( i) on the basis of a period of 25 years and the appraioemtnt of
the annual yield, under s. 39(1)(e)(ii), on the date of vesting.
Jn appeals to this Court,
HELD : ( 1) The High C.ourt was correct in holding that the average
annual income from forest under s. 39(1)(e) of the Act cm.Id not be
computed by arithmetical addition of the figures arrived at on the basis
of cl. ( i) and on the ba,is of cl. (ii). The section ,,,,,.xi of computa·
ti0n of average annual income from forest, (i) on t1'c basis of ioc<;ime
for a period of 20 to 40 agricultural years immedialely ,-ding the
date of vesting as the Compensation Officer may consider rca!OflabJe.
and (ii) on the appraisement of the annual yield of the forest on the
date of vesting.
Under the first clause. the actual income derived from
the forest for a number of years before the date of vesting as the Compensation Officer may consider reasonable is to be taken and the average
calculated.
Under the second clause the annual yield as on the date of
vesting is to be appraised. This should be done, Inter alia. by taking
ihto considetation the num'Oer and age of trees, the area pf cultivation
and the produce. Therefore. the compensation officer has to compute
the 'average annual income' by taking recourse to both the iPethods
but not by adding the figures on the basis of cl. (i) and on tlic.,h!ll of
ct (ii l [435 D·H; 436 A-BJ
'
(2) The High Court rightly held that forest income was reftnhlc lo
price of the standing timber. Hence any income which the appenants
derived by processing wood, was income in the nature of trade and
would not be forest income. [436 E-GJ
CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 41 to
46 of 1967.
Appeals from the judgment and order dated September 1. 1965
of the Allahabad Hig,h Court in First Appeals Nos. 513 of '1955
etc.
15-L8R7S,·pCJ/72
432
SUPREME COURT REPORTS
[1972] 3 S.C.ll.
M. C. Chagla, S. R. Agarwala, A. T. M. Sampath and E. C.
Agarwala, for the appellants (in all the appeals).
L. M. Singhvi and 0. P. Rana, for the respondent (in all the
appeals).
A
The Judgment of the Court was delivered by
B
Ray, J. These six appeals are by certificate from the judgment
dated 1 September, 1965 of the High Court at Allahabad, Lala
Triloki Nath and Lala Digambar Prasad filed four appeals and the
State two in the High Court agaiust the order dated 6 September,
1955 of the Compensation Officer. During the pendency of the
appeals the Lalas died and the appellants were brought on record.
The High Court allowed the appeals filed by the State and allowed in part the appeals filed by the appellants. The appellants have
come up by certificate in these six appeals.
Each of the Lalas held equal one half share in each of the
forests in the villages of Chharba and Prithipur in Dehra Dun District.
By a notification dated 1 July, 1952 under the U.P. Zamindari Abolition and Land Reforms Act, 1950 (hereinafter called
the Act) the entire furest vested in the State of Uttar Pradesh.
On 2 May, 1953 the Lalas received the Draft Compensation
Assessment Rolls under section 46 (1 )(b) of the Act which showed annual compensation to be paid to the Lalas as nil.
The Lalas thereafter on 20 May, 1953 filed their objections
against the draft compensation roll and claimed compensation
under the provisions of the Act.
c
D
E
With regard to village Chharba the Lalas claimed that it was a
valuable sal forest comprising 225 acres.
The Lalas assessed .the
worth of the forest at Rs. 3,40,000. Tkey claimed that sayar
F
income during the 10 agricultural years immediately preceding the
date of vesting should be computed separately and added to the
gross income from the forests.
They further claimed that income
by selling poola grass was to be within sayar income.
The next
head of claim was that they did not have accounts of the income
of the forest for the previous 20 years but they were able to proG
duce accounts for four years from 1944 up to 194 7 and the share
of each of the Lalas on the basis of the income derived for the said
four years came to Rs. 1274-12-0 and on the basis of the appraisement of the annual yield
on the date of vesting it came to
Rs. 5457 /-.
On,this basis each of the Lalas claimed Rs. 46740/-
as compensation in respect of village Chharba,
H
With regard to the Prithipur forest the Lalas claimed that they
had worked the forest during the years 1945 to 1952 and that the
GANGA DEVI v. U.P. STATE (Ray, /.)
433
A
average annual income of each of their share from the Pri!hipur
forest on the basis of 20 agricultural years immediately preceding
the date of vesting came to Rs. 5106/-. The Lalas stated that on
the basis of appraisement of the annual yield on the date of vesting
of the forest Prithipur the share oi each came to Rs. 7955/-. On
this basis each of the Lalas claimed a sum of Rs. 101114 and odd
B as compensation for the forest Prithipur.
The Compensation Officer decided that the income from the
poola grass was not sayar income but forest income and disallowed
income from poola grass in entirety. The Compensation Officer
however allowed some sayar income in each forest and decided
that the average annual income of the forest under section
C
39(1) (e) of the Act should be calculated on the basis of the period
of 25 years immediately preceding ;he date of vesting an<j. not 20
years as the Lalas had claimed.
With regard to the forest in
village Chharba the Compensation Officer arrived at the figure of
Rs. 55292/- consisting , of Rs. 4300/-
as sayar income and
Rs. 50992/- as the forest income for computation of average
D annual income on the bas.is of the period oi 25 years and thus
arrived at the annual income of Rs. 2211-8-0 under; section
39(l)(e)(i) of the Act. With regard to the computation of
average annual income on the appraisement of the annual yield of
the forest on the date of vesting as contemplated in section
39(1) (e)(ii) of the Act the Compensation Officer held that the
· ]1
representative area was not specified by the Lalas with enumeration or location and the enumeration figures of the Lalas were bas·
ed on estimated and presumed calculations.
The Lalas appraised Rs. 11000/- as the annual yield on the
date of vesting. The Compensation Officer found that the forest
F had been felled about 6 to 8 years before vesting and the age of
the crop for that reason could not be more than 8 Jears for coppice. The Compensation Officer thus appraised Rs. 800/- as the
annual yield and determined Rs. 2211-8-0 and Rs. 800/· aggregating Rs. 3011-8-0 as the average annual income to be added to
the gross a~sets for assessment of compensation.
G
With regard to the forest in village Prithipur the Lalas cl-aimed
Rs. 5106/- as the annual income for a period of 20 agricultural
years immediately preceding the date vesting and appraised the
annual yield on the date oi vesting at Rs. 7955/-. The Lalas claimed one tenth of the sayar income for 10 agricultural yea's at
Rs .. 2007-8-0. The Compensation Officer disallowed income from
H poola grass but allowed sayar income of Rs. 23550/. and added
the same to the forest
income of Rs. 113914/-
aggregating .
Rs. l 37464/- on the basis of a period of 25 years and thus amved at the average annual income of the forest under section
434
SUPREME COURT REPORTS
[1972] 3 S.C.R.
39(1) (e) of the Act at Rs. 5496-8-0. The Compensation OffiA
cer appraised the annual yield ,at Rs. 1650/- and thus arrived
at the total sum of Rs. 7146-8-0 to be added as gross assets of
forest income.
. In the High ~ourt th~ State. contended that the Compensation Officer was m error m adding the annual income on the
B
basis of a period of 25 years and the appraisement of the annual
yield in order to arrive at the average annual income under section 39 ( 1 )( e) of the Act. The contentions of the Lalas in the
High Court were these : First. the income from poola grass was
sayar income and should have been allowed and added separately to the average annual income.
With regard
to Prithipur c
forest it was said that the Compensation Officer wrongly rejected the 5ayar income for the Fasli years 1352 and 1353 amounting to Rs. 4600/- and Rs. 4500/' respectively.
Secondly, the
average annual income from forest should have been detennined on the basis of income for a period of 20 and ncit 25 years.
Thirdly, the Compensation Officer was in error in not accepting
0
the whole income of the Prithipur forest for
the Fasli years
135~. 1356, 1357 and 1358 by holdin.11: that the income durin.11:
those four years had been derived by processing wood and therefore the income was made by activities in the nature of trade
and was not forest income.
Fourthly, the Compensation Officer should have accepted the appraisement of the annual yield
of the forest on the date of vesting as claimed by the Lalas.
E
The High Court came to the conclusion that the Lalas were
entitled to income from poola grass as sayar income and thus
allowed the appeals of the Lalas in part.
The sayar income is
not to be c1ubbed with the average annual income but is to be
dealt with separately.
Sayar income is dealt with in section 39(1)(c) of the Act.
Sayar is not defined in the Act but in section 3 (26) of the Act
the word 'sayar' is to have the meaning assigned to it in the
United Provinces Te!lancy Act, 1939. In the 1939 Tenancy
F
Act sayar includes whatever is to .. be paid or ~elivered by a
leasee or Iicencee on account of nght of gathenng produce.
G
forest rights, fisheries and the use of water for irrigation from
artificial sources. Therefore the income derived by 'the landlord from persons who have been given licences to cut and remove poola grass from forest has been held by the High Court
to be sayar. We agree with the reasoning of the High Court.
The High Court was correct in holding that the sayar income H
during 1 O agricultural years imm~iatel)'. pre~eding th~ ~ate of
vesting should be taken into cons1deratton m determmmg the
gross assets under section 39 of the Act.
A
B
c
D
E
F
G
H
'GANGA DEVI V, U.P. STATE (Ray, J.)
435
Counsel for the appellants submitted that the High Court
did .not deal with the finding of thte Compensation Officer with
regard to income from poola grass for the Fasli years
1352
and 1353 in respect of Prithipur forest.
The Lalas claimed
for the Fasli year 1352 a sum of Rs. 4600/- and for the Fasli
year 1353 a sum of Rs. 4500/ • as income from poola grass. The
Compensation Officer gave the additional reason for rejecting·
the income from poola grass for these two years that in the extract of khatauni it was not mentioned as to what the source of
income was.
Exhibit P-3 being the extract from khatauni for
the Fasli year 1352 would show that Rs. 4600/- was the rent
for clause 13 sawai items.
Again, Exhi!>it P-10 for the Fasli
year 1353 in respect of Prithipur forest would show the sum of
Rs. 4500/- on account of rent for sayar.· Therefore when the
Compensation Officer will deal with sayar income he will take
into consideration Exhibits P-3 aM P-10 for the Fasli years
1352 and 1353.
In the High Court it was contended that the Compensation
Officer was wrong in taking 25 years to be the period on the
basis of whicb annual average income of the forest was to be
computed under section 39 (l) ( e) of the Act. The High Court
did not accept that contention.
This contention
was not repeated in this Court.
The High Court held that the Compensation Officer was
wrong in arriving at the average annual income by adding the
annual income on the basis of a period of 25 years and the
aopraisement of the annual yield on the date of vesting.
The
High Court said that the two clauses in section 39(1) (e) of the
Act were independent methods of finding out the average annual
income from forest and it was not intended that the average
annual income should be arrived at by adding the two methods.
Section 39 ( 1 )( e) of the Act speaks of computation of average
annual income from forest (i) on the basis of income for
a
period of 20 to 40 agricultural years immediately preceding the
date of vesting as the Compensation Officer may consider reasonable and (ii) on the appraisement of the annual yield of the
forest on the date of vesting.
The two are separate matters. It
cannot be said that the Compensation Officer will adopt either
of the clauses.
The Compensation Officer. has to refer to both
the· clauses in order to compute the average
annual
income
from forest.
The High Court is correct in holding that the
average annual income from forest under section 39 (I )( e) of
the Act cannot be computed by arithmetical addition of the
figures arrived at on the basis of clause (i) and on the basis of
clause (ii). It is the average annual income from forest which
is to be computed.
The words of importance are
'average
annual income'.
Under the first clause the actual income de-
436
SUPREME COURT REPORTS
(1972] 3 S.C.R,
rived from the forest for a number of years before the date of
A
vesting as the Compensation Officer may consider reasonable
is to be taken and the average calculated.
Under the second
clause the annual yield as on the date of vesting is to be appraised.
The Compensation Officer is to compute the average in-
. come by taking recourse to both the methods. The sec9nd clause
which speaks of appraisement of the annual yield will be done
g
inter alia by taking into consideration the number and age of
trees, the . area of cultivation and the produce.
In the present appeals the High Court found on the 'm~te
rials that the forest had been felled almost completely during
the last 9 or 10 years preceding the date of vesting.
The
evidence further established that there were no mature trees for c
felling and that the bulk of the crop that had existed had grown
within a period of 8 years.
It was therefore
clear that the
whole of the forest's income derived during those 9 or 10 years
for which accounts of the Lalas were available represented the
whole grnwth of the forest during the last 40 years and even if
the forest had been gradually cut during the last 40 years the
income derived would not have been substantially more
than
what have been derived during the last 9 or 10 years preceding
the date of vesting.
The High Court assessed the evidence. We do not find that
there is any error in regard to the appreciation or assessment of
evidence by the High Court and the conclusion that under section 39(1 )(e) of the Act the annual average income of PrithiE
pur forest came to Rs. 4396.56 and of
village
Chharba at
Rs. 2039.68.
Counsel for the appellants contended that the Compensation
Officer did not consider the entire forest income for the Fasli
years 1352, 1356, 1357 and 1358 for the Prithipur forest on
the ground that the entire income was not the sale price of
F
forest but that the Lalas worked the forest and a portion of the
income was from the sale of the timber of that forest.
The
High Court rightly held that the forest income was referable to
the price of the standing timber and income which the Lalas
derived by processing wood would not be within forest income.
For these reasons we uphold the judgment and order of the G
High Court with this modification that when the Compensation
Officer will deal with the income from poola grass as . sayar in•
come as derived by the High Court the Compensation Officer
will also take into consideration the income from poola grass
for the Prithipur forest for the years 1352 and 1353 Fasli.
In the facts and circumstances of the case the appeals are H
dismissed.
The parties will pay and bear their own costs.
V.P .S.
Appeals dismissed.