Unsupported factual basis for annulment under land reform law cannot sustain a finding of loss to the State.

A statutory annulment under Section 4(b) of the Bihar Land Reforms Act, 1950 cannot be sustained unless the finding that a settlement was made to cause loss to the State rests on evidence. The Collector's conclusion was based mainly on the assumption that rent of Rs. 3 per katha was unusually low, but no material was produced to show the prevailing rent for similar land at the relevant time. Because the decisive factual basis was unsupported and rested on conjecture, the annulment order was held unsustainable and the impugned orders were set aside.

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Issues: Whether the order annulling the settlement under Section 4(b) of the Bihar Land Reforms Act, 1950 was sustainable when the conclusion that the settlement was made to cause loss to the State rested on no material as to the prevailing rate of rent.

Analysis: Section 4(b) empowered the Collector to annul a transfer or settlement made after the relevant date if satisfied that it was intended to defeat the Act, cause loss to the State, or secure higher compensation. The decision below proceeded mainly on the assumption that the rental of Rs. 3 per katha was very low and, therefore, indicative of an intention to cause loss to the State. However, no evidence had been produced to show the prevailing rate of rent for similar land at the relevant time. The principal factual basis for the finding was thus unsupported by material and rested on assumptions and conjectures.

Conclusion: The annulment order was unsustainable because the crucial finding under Section 4(b) was based on no evidence.

Final Conclusion: The appeal succeeded and the impugned orders were set aside.

Ratio Decidendi: A statutory finding that a transfer or settlement was made to cause loss to the State cannot stand where the decisive factual basis for that finding is unsupported by evidence.

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