2015 (9) TMI 1673 - HC - Indian Laws

Invalidity of 37-year-old show-cause notice due to unreasonable delay and ownership change

The court found the show-cause notice issued after 37 years to be invalid due to being beyond a reasonable period, with the delay and change in ownership ... Sale of land under litigation - invalidation of the transaction - Jurisdiction for initiation of SCN - after 37 years from the date of the revenue entry, the proceedings are initiated under the Ordinance - HELD THAT:- It is by now well-settled that if the action of initiation of the SCN is without jurisdiction, or exfacie barred by delay, the court may entertain the petition under Art. 226 of the Constitution. At this stage, we may refer to the decision of the Apex Court in case of STATE OF PUNJAB VERSUS BHATINDA DISTRICT CO-OP. MILK P. UNION LTD. [2007 (10) TMI 300 - SUPREME COURT], wherein the showcause notice issued in purported exercise of the revisional power came to be challenged, inter alia, on the ground that the notice was beyond the period of limitation. If the action is to be initiated for setting aside of a transaction under the Ordinance by invoking section 54 read with section 75 of the Ordinance, it has to be within reasonable period - in the present case, the proceedings is initiated after more than 35 years. Hence, we find that the initiation of the action itself can be said as beyond reasonable period and the bar of delay and laches could operate against the authority in initiation of the action. The aforesaid aspect is coupled with two additional circumstances, one is that the land has changed hands further during the period of delay and the ownership is transferred by the purchaser to the another person and the second is that the revenue entries were mutated. Thereafter, they were also certified by the competent authority and in spite of that, no action was taken for cancellation of such entry or otherwise or even for declaration of the transaction as invalid within reasonable period. If during the period of delay, the rights of the parties in the properties are altered, the delay would operate as a bar with more gravity and when the ownership is changed during the period of delay, the bar for not taking action within reasonable period would also operate with more gravity against the authority in initiation of the action. The contention should fail even if considered in either way. If considered to be patent in any case, the action was required to be initiated within reasonable period which has not been initiated. If the contention is considered on the ground that the error was latent, then also, as per the provisions of the Bombay Land Revenue Code read with the Rules, before any entry is mutated in the revenue record, the notice under section 135D is required to be served to the original owner. When the respondent no.5 originated the Government machinery, the bonafide would be lacking since one who is a party to the transaction cannot be heard to say at a later stage that the transaction is not valid that too after a period of about more than 35 years. In any case, respondent no.5 had moved the authority and the impugned action of issuance of show cause notice has been taken, but when the Court considers the aspect of reasonable period and finds that the exercise of the jurisdiction was barred by delay and the consequential action could be said as without jurisdiction, the question of locus on the part of respondent no.5 may not assume much importance. Petition allowed. Issues Involved:1. Validity of the show-cause notice issued after 37 years under the Saurashtra Gharkhed, Tenancy Settlement and Agricultural Land Ordinance, 1949.2. Jurisdictional question regarding the delay in issuing the show-cause notice.3. Locus standi of the respondent in challenging the transaction.4. Applicability of Section 75 of the Ordinance concerning the forfeiture and re-entrustment of land.Detailed Analysis:1. Validity of the Show-Cause Notice Issued After 37 Years:The court examined whether the initiation of proceedings under the Ordinance after a delay of 37 years was permissible. The appellants argued that the show-cause notice was issued long after the transactions were completed and revenue entries were certified. The court referred to multiple precedents, including State of Punjab v. Bhatinda District Cooperative Milk Producers Union Ltd., which established that a question of limitation is a jurisdictional question and thus maintainable under Article 226 of the Constitution. The court concluded that the initiation of action after such a prolonged period was beyond a reasonable time and thus invalid.2. Jurisdictional Question Regarding the Delay:The court discussed the principle that even if no specific limitation period is prescribed, actions must be taken within a 'reasonable period.' This principle was supported by various judgments, including State of Gujarat vs. Patel Raghav Natha and Chandulal Gordhandas Ranodriya & Ors. v. State of Gujarat, which emphasized that allowing void transactions to remain effective for a long period could create valuable rights for parties involved, making it unreasonable to annul such transactions after a significant delay. The court found that initiating action after 35 years was beyond reasonable time, making the show-cause notice jurisdictionally invalid.3. Locus Standi of the Respondent:The respondent's father, one of the original sellers, did not contest the transactions during his lifetime. The court noted that the respondent, who raised the issue after 35 years, lacked the bona fide to challenge the transaction. Citing Patel Ratilal Maganbhai vs. State of Gujarat, the court emphasized that legal heirs of the original transferor cannot contest a voluntary sale after such a long period, especially when the transferor accepted the consideration and did not raise any disputes during his lifetime. Thus, the respondent's locus standi was considered weak.4. Applicability of Section 75 of the Ordinance:The court examined whether Section 75 of the Ordinance, which provides for summary eviction, also implied forfeiture or re-entrustment of land to the original owner. The court noted that Section 75 did not explicitly provide for forfeiture by the State or re-entrustment to the original owner, unlike Section 84C of the Bombay Tenancy and Agricultural Lands Act, 1948. The court refrained from making a final determination on this issue but suggested that the notice might be ultra vires to Section 75 of the Ordinance.Conclusion:The court concluded that the show-cause notice issued after 37 years was beyond a reasonable period and thus invalid. The delay and change in ownership over the years further compounded the issue, making the action jurisdictionally flawed. The respondent's challenge to the transaction was also found to lack bona fide. Consequently, the court quashed the show-cause notice and set aside the order of the learned Single Judge, allowing the appeal. The court also clarified that the pending civil suits should be decided independently of this judgment.