TaxTMI 
TaxTMI 
2010 (2) TMI 1141
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....the legal representatives of Inamdars have filed Civil Appeal No.3038/2007, the Teachers' Colony Residents Association has filed Civil Appeal No.3049/2007 and several owners of the house sites have filed the remaining Civil Appeals. Facts 3. The relevant facts briefly are that the Mysore (Personal & Miscellaneous) Inam Abolition Act, 1954 (for short `the Inam Abolition Act') was enacted for abolition of personal Inams and other miscellaneous Inams in the State of Mysore, except Bellari District. On the Inam Abolition Act coming into force on 1.2.1959, all rights, title and interests vested in the Inamdars ceased and vested absolutely in the State of Mysore free from all encumbrances. Every Inamdar, however, was entitled to be registered as an occupant of land and could make an application before the Special Deputy Commissioner, Inam Abolition, for such registration as an occupant. 4. Sreenivasa Rao and Babu Rao, two Inamdars, filed applications for registration as occupants in respect of some lands in Survey Nos. 45 and 47 of Jakkasandra village, Bangalore South Taluk. When these applications were pending before the Special Deputy Commissioner, Kendra Upadhyayara S....
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.... Deputy Commissioner, Inam Abolition, will decide the claims for occupancy rights under the Inam Abolition Act. Thereafter, the Tribunal by its order dated 23.6.1982 passed in Case No. I.R.F. INA 419/1979-80 decided the claims of Sreenivasa Rao and Babu Rao for occupancy rights in respect of the land and ordered the confirmation of the occupancy rights in the suit land in favour of Sreenivasa Rao and Babu Rao jointly. Pursuant to the order dated 26.6.1982 of the Tribunal, Sreenivasa Rao and Babu Rao withdrew the amount of Rs. 3,40,750/- deposited with the Government by the Sangha. During the years 1982 to 1990, the Sangha got the layout plan of the land of 34 acres 3 guntas allotted to the Sangha sanctioned from the Bangalore Development Authority (for short the `BDA') and allotted sites to its members and the members of the Sangha built houses on some of these sites and some members also transferred their house sites to others. 7. In the year 1990, however, Nagaraj, Venkojirao and Narhari, the legal representatives of Sreenivasa Rao filed W.P. No.11412/1990 in the Karnataka High Court challenging the order dated 15.6.1979 of the State Government of Karnataka granting the la....
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.... 6.8.2002 of the State Government and by an order dated 28.11.2002 the learned Single Judge of the High Court allowed the Writ Petitions and remitted the matter to the State Government with the direction to comply with the order dated 9.4.1999 of this Court after hearing the petitioners and the respondents in the writ petitions and any other person interested in the matter. The legal representatives of the Inamdars also filed Writ Petition Nos.39046-48/2002 seeking deletion of a condition of the grant made in their favour, but on 9.1.2003 they withdrew the writ petitions as not pressed. The State Government of Karnataka by its order dated 10.2.2003 then directed the Special Deputy Commissioner to stop construction on the land in dispute till disposal of the final proceedings and this order dated 10.2.2003 was challenged before the Karnataka High Court in W.P. No.8551/2003, but by an order dated 6.3.2003 the High Court while dismissing the writ petitions directed the State Government to decide the matter within two months. The Special Deputy Commissioner then submitted his report to the Statement Government on 28.5.2003 and when the State Government did not pass any order in complia....
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....r dated 15.6.1979 according sanction for grant of the land in favour of the Sangha and the Minister, Revenue, Government of Karnataka, was justified in passing the order dated 22.12.2003 cancelling the grant in favour of the Sangha and ordering resumption and restoration of 182 house sites in favour of the Inamdars pursuant to the order dated 9.4.1999 of this Court. (ii) The order dated 15.6.1979 of the State Government sanctioning the grant of the land in favour of the Sangha for allotment of house sites to its members was void ab initio in law as Sections 79-A, 79-B and 63(7) of the Karnataka Land Reforms Act provided for allotment of land only for agricultural purposes and the rights given under the provisions of the Act to Inamdars in respect of land in question could not be whittled down by the State Government in exercise of its power under the Karnataka Land Grant Rules, 1969. (iii) The Agreement executed by the Inamdars on 1.11.1980 in favour of the Sangha when the claim of the Inamdars for registration had not been decided by the Tribunal was not legal and was void and being an unregistered agreement could not affect the rights of the Inamdars to immovable property. ....
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....compensation in respect of the land acquired by the BDA for formation of the road, if any. The High Court also quashed the direction in the order dated 22.12.2003 to examine whether further 20 acres of land can be allotted to the Inamdars. Contentions of the parties before this Court 12. Mr. Dushyant Dave, learned senior counsel appearing for the legal representatives of the Inamdars (the appellants in Civil Appeal No.3038 of 2007), referred to sub-Section (1) of Section 3 of the Inam Abolition Act which states the consequences of a notification under sub-Section (4) of Section 1 in respect of any inam and submitted that the expression "save as otherwise expressly provided in the Act" in this provision saves the right of Inamdar under Section 9 of the Act to be registered as an occupant in respect of the land from the consequences of vesting even after a notification was issued under sub-section (4) of Section 1 of the Act. He submitted that clause (c) of sub-section (1) of Section 3 makes this position further clear by stating that upon an issue of a notification under sub-section (4) of Section 1 of the Act in respect of any inam, the Inamdar shall cease to have any interes....
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....the Inamdars to the land. 13. Mr. Dave next submitted that the High Court was also right in coming to the conclusion in the impugned order that the grant of land by the State Government by the order dated 15.6.1979 in favour of the Sangha for allotment of house sites to its members was void ab initio as the land could only be allotted for agricultural purposes and not for house sites under the Karnataka Land Reforms Act (for short `the Land Reforms Act'. He also submitted that Section 79-A of the Land Reforms Act prohibits acquisition of any land by any person or a family or a joint family which has an assured annual income of not less than Rs. 2 lakhs from sources other than agricultural lands. He further submitted that Section 79-B of the Land Reforms Act prohibits any person other than the person cultivating land personally from holding any land and Section 80 of the Act further prohibits transfer of land to non- agriculturists. He submitted that Section 81 of the Land Reforms Act, however, provides that nothing in Section 79-A or Section 79-B or Section 80 of the Act shall apply to the transactions or to the institutions and companies mentioned therein, but this Section ....
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....ered compulsorily. He submitted that since the agreement dated 1.11.1980 executed by the Inamdars in favour of the Sangha is not registered, it cannot affect the right, title and interest of the Inamdars in respect of the land. In support of this proposition, he relied on Bhoop Singh v. Ram Singh Major and Others [(1995) 5 SCC 709] and Appineni Vidyasagar v. State of A.P. and Others [(2004) 11 SCC 186]. 16. Mr. Dave also supported the conclusion of the High Court in the impugned order that the orders passed by the Karnataka High Court in earlier proceedings in W.P. No.11412/1990 and W.A. No.7574/1996 do not operate as res judicata. He submitted that the question of res judicata does not arise because the order dated 15.6.1979 of the State Government sanctioning the land in favour of the Sangha was void ab initio. He cited the decisions of this Court in Mathura Prasad Bajoo Jaiswal and Others. v. Dossibai N.B. Jeejeebhoy [(1970) 1 SCC 613] and Smt. Bismillah v. Janeshwar Prasad and Others [(1990) 1 SCC 207] in which it has been held that an earlier decision will not be res judicata when the earlier decision declares valid a transaction which is prohibited by law. He submitted tha....
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....for examination to allot 20 acres of land in favour of the Inamdars and should set aside the order passed by the Division Bench of the Karnataka High Court. 19. Mr. P.P. Rao, learned senior counsel appearing for the Teachers' Colony Residents Association (the appellants in Civil Appeal Nos.3049/2007), on the other hand, submitted that Inamdars were only entitled to the occupancy price of Rs. 10,000/- per acre amounting to Rs. 3,40,750/- for the entire land measuring 34 acres 3 guntas which was given as grant by the State Government to the Sangha and they have in fact withdrawn the amount of Rs. 3,40,750/-. He submitted that in addition to the price of Rs. 10,000/- per acre, the Inamdars agreed by the agreement dated 1.11.1980 to take from the Sangha a further amount of Rs. 2,000/- per acre and on receipt of Rs. 2,000/- per acre withdrew O.S. No.687/1979 from the Court of Principal Munsif, Bangalore, in which the grant of land made by the State Government in favour of the Sangha by order dated 15.6.1979 had been challenged. He submitted that after the suit of the Inamdars were dismissed as withdrawn, the right to challenge the grant made in favour of the Sangha by the State G....
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....t merged with the order dated 9.4.1999, is misconceived. 21. Mr. Rao next submitted that the judgment dated 15.9.1998 of the Division Bench of the Karnataka High Court in W.A. No.7574/1996 had, therefore, become final and binding on the parties and the rights which had accrued in favour of the Sangha and its members to occupy the land granted to its members by the Sangha under the judgment dated 15.9.1998 could not be taken away by an executive order and yet the Minister, Revenue, Government of Karnataka, passed orders on 22.12.2003 canceling the grant of land made in favour of the Sangha and issuing directions for resumption and restoration of land to the extent of 182 sites in favour of the legal representatives of the Inamdars. Mr. Rao relied on the decision of this Court in Madan Mohan Pathak and Another v. Union of India and Others [(1978) 2 SCC 50] in which the Life Insurance Corporation claimed that it was absolved of its obligation to carry out the writ of mandamus issued by the Court because of the provisions of an amending Act but this Court did not accept this plea of the Life Insurance Corporation and held that there was nothing in the amending Act which set at naugh....
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.... dated 22.12.2003 of the Minister, Revenue, Government of Karnataka, directing handing over of the civic amenity sites to the Inamdars free of cost and directing acquisition of the land forming the Ring Road and payment of compensation to the Inamdars for such acquisition, but these directions in the order dated 22.12.2003 of the Minister, Revenue, Government of Karnataka, have not been set aside by the Division Bench of the Karnataka High Court in the impugned judgment. 23. Mr. Javali referred to earlier judgment dated 15.9.1998 of the Division Bench of the Karnataka High Court in W.A. No.7574/1996 to show that the Inamdars had filed petitions before the BDA saying that they had entered into an agreement with the Sangha and waived their right to challenge the grant of land by the State Government in favour of the Sangha and had also agreed not to take or prosecute legal proceedings in respect of the disputed land and, therefore, had acquiesced to the grant in favour of the Sangha. He also referred to the aforesaid order of the Division Bench of the Karnataka High Court in Writ Appeal No.7574/1996 to show that the Inamdars had agreed to carry out some work in the land by the San....
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....ment of Karnataka, by referring to the reasons indicated in the order itself. He further submitted that this order was passed by the Minister, Revenue, Government of Karnataka, because of the pressure of contempt put by the legal representatives of the Inamdars on the Government saying that the order dated 9.4.1999 of this Court in SLP (C) No.2833/1999 was not being complied with by the State Government. He submitted that Minister, Revenue, Government of Karnataka, has taken an equitable view of the entire matter and has not disturbed those members of the Teachers' Association or Sangha who have already utilized the house sites for construction of the houses and has directed resumption and restoration of only the 182 vacant sites in the land in favour of the Inamdars and cancelled the earlier grant of land in respect of these 182 sites in favour of the Sangha in exercise of powers under Rule 25 of the Karnataka Land Grants Rules, 1969. Our conclusions with reasons 26. The order dated 15.6.1979 of the State Government sanctioning the grant of 34 acres 3 guntas of land in favour of the Sangha was earlier challenged before the Karnataka High Court by the legal representative....
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....e order cannot be set back." Thus, the Division Bench of the Karnataka High Court in the judgment dated 15.9.1998 in Writ Appeal No.7574/1996 negatived the contention that the order dated 15.6.1979 of the State Government sanctioning the grant of land in favour of the Sangha was bad because the claim of the Inamdars for registration under Sections 9 and 10 of the Inam Abolition Act was pending before the Special Deputy Commissioner and instead held that in case the claims of the Inamdars to occupancy in respect of the inam land were upheld, they would be entitled for the price payable for the land. 28. On a reading of the judgment dated 15.9.1998 of the Division Bench of the Karnataka High Court in Writ Appeal No.7574/1996, we further find that it was contended on behalf of the Sangha that the Inamdars have waived their occupancy rights in respect of the inam land by entering into the agreement dated 1.11.1980 and by receiving the amounts towards the land price apart from the compensation of Rs. 3,40,750/- and the Division Bench of the Karnataka High Court accepted the contentions raised on behalf of the Sangha and recorded the following findings: "The above two paras in t....
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....6.1979 of the State Government of Karnataka, sanctioning the grant of land in favour of the Sangha and by receiving Rs. 2,000/- per acre and Rs. 49,000/- in addition to the price of Rs. 10,000/- per acre totaling to Rs. 3,40,750/-. 30. The judgment dated 15.9.1998 of the Division Bench of the Karnataka High Court in Writ Appeal No.7574/1996 was sought to be challenged by the legal representatives of the Inamdars before this Court in SLP (C) No.2833/1999, but this Court did not grant special leave to the legal representatives of the Inamdars to appeal and instead disposed of the SLP with the following order: "It appears from the order of grant made in favour of the respondent-society that it was made condition upon the outcome of the dispute which was pending then before the Special Deputy Commissioner for Abolition of Inam. We are now told that the said proceedings have resulted in favour of the petitioners. If that is so, it would be open to the petitioners to approach the State Government for modification of the order granting land to the respondent-society. If such application is made, the State Government shall dispose of the same within the period of three months from th....
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....he Supreme Court being the Apex Court of the country. But, this does not amount to saying that the order of the court, tribunal or authority below has stood merged in the order of the Supreme court rejecting the special leave petition or that the order of the Supreme Court is the only order binding as res judicata in subsequent proceedings between the parties." Hence, an order refusing special leave to appeal does not stand substituted in place of order under challenge and all that it means is that this Court was not inclined to exercise its discretion so as to allow the appeal being filed. The aforesaid law laid down by this Court however makes it clear that if the order refusing leave to appeal makes a statement of law, such statement of law is declaration of law by this Court within the meaning of Article 141 of the Constitution of India and if the order records some finding other than the declaration of law such finding would bind the parties thereto and also the Court, Tribunal or Authority in any proceeding subsequent thereto by way of judicial discipline, the Supreme Court being the Apex Court of the country. 33. Applying the law laid down by this Court in Kunhayammed ....
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....9 and the findings on the three issues in the order dated 15.9.1998 in Writ Appeal No.7574/1996 did not operate as res judicata and were not binding on the legal representatives of the Inamdars, the State Government, the Teachers' Colony Association or the Sangha and its members, is misconceived. 34. In the common judgment impugned in the present appeals, however, the High Court has taken a view that the orders passed by the Karnataka High Court in the earlier proceedings in W.P. No.11412/1990 and W.A. No.7574/1996 do not operate as res judicata as the case of the Inamdars with reference to the provisions of the Inam Abolition Act and the law laid down by this Court on various aspects were not considered in the earlier writ petitions and writ appeal and the decisions rendered by the Division Bench of the Karnataka High Court in W.A. No.7574/1996 were per incurium. The High Court has failed to appreciate that the principle of per incurium has relevance to the doctrine of precedents but has no application to the doctrine of res judicata. To quote Rankin, C.J. of the Calcutta High Court in Tarini Charan Bhattacharjee and Others v. Kedar Nath Haldar [AIR 1928 Calcutta 777 at 781....
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.... raised on behalf of the legal representatives of the Inamdars that grant of land in Survey Nos.45 and 47 of Jakkasandra village could not be sanctioned in favour of the Sangha for house sites because of the restrictions in Sections 79-A, 79-B and 80 of the Land Reforms Act. If this ground of attack had not been taken by the legal representatives of the Inamdars while challenging the order dated 15.6.1979 of the State Government sanctioning the grant of land in favour of the Sangha, this contention could not be raised by them before the High Court in a subsequent proceeding because of the principle of constructive res judicata underlying Explanation IV of Section 11 of the Code of Civil Procedure which has been applied to writ petitions. In Direct Recruit Class II Engineering Officers' Association v. State of Maharashtra and Others [(1990) 2 SCC 715] a Constitution Bench of this Court observed at Page 741: "The decision in Forward Construction Co. v. Prabhat Mandal (Regd.), Andheri [(1986) 1 SCC 100] further clarified the position by holding that an adjudication is conclusive and final not only as to the actual matter determined but as to every other matter which the parties....
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.... Sangha for house sites on payment of conversion fine and the grant made by the State Government in favour of the Sangha by the order dated 15.6.1979 was not void ab initio on this count. 37. Mr. Dave, however, is right in his submission that res judicata will not operate as a bar for entertaining a fresh cause of action and in the present case the order dated 22.12.2003 passed by the Minister, Revenue, Government of Karnataka, gave rise to a fresh cause of action. But even where a fresh cause of action arises, issues between the parties which have been decided cannot be re-opened before the Court for fresh adjudication between the same parties. In State of Haryana and others v. M.P. Mohla [(2007) 1 SCC 457] (supra) cited by Mr. Dave, this Court has held: "22. ........ The dispute between the parties has to be decided in accordance with law. What, however, cannot be denied or disputed is that a dispute between the parties once adjudicated must reach its logical conclusion. If a specific question which was not raised and which had not been decided by the High Court the same would not debar a party to agitate the same at an appropriate stage, subject, of course, to the applicab....
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.... 39. In Madan Mohan Pathak and Another v. Union of India and Others (supra), the Calcutta High Court in Writ Petition No. 371 of 1976 had delivered the judgment dated 21.5.1976 issuing a writ of mandamus directing the Life Insurance Corporation to pay annual cash bonus to Class III and Class IV employees for the year April 1, 1975 to March 31, 1976 along with their salary for the month of April, 1976. Against the said judgment of learned Single Judge of the Calcutta High Court, Letters Patent Appeal was filed but by the time Letters Patent Appeal came up for hearing, the Life Insurance Corporation (Modification of Settlement) Act, 1976 came into force and there was no provision in this Act absolving the Life Insurance Corporation from its obligation to carry out the writ of mandamus issued by the learned Single Judge of the Calcutta High Court. For some reason or the other, the Letters Patent Appeal against the judgment of the learned Single Judge was withdrawn by the Life Insurance Corporation. P.N. Bhagwati, J., as he then was, delivering the judgment on behalf of himself, Krishna Iyer and Desai, JJ. held that since the Life Insurance Corporation did not press the Letters Patent....
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....sanctioning the layout plan of the Sangha, the BDA had stipulated that the roads, civic amenity sites, parks and all connections such as underground drainage, water supply lines, shall vest with the BDA free of cost. The civic amenity sites and the road, therefore, had become properties of the BDA and it was the BDA only which was empowered to deal with such properties subject to Section 38-A and other provisions of the Bangalore Development Authority Act, 1976. The order dated 22.12.2003 of the Minister, Revenue, Government of Karnataka, directing that the civic amenity sites be handed over to the Inamdars free of cost and directing that the BDA will acquire the land comprised in the ring road after paying compensation for the same, was thus without the authority of law. 41. For the aforesaid reasons, the directions in the order dated 22.12.2003 of the Minister, Revenue, Government of Karnataka, for cancellation of grant made in favour of the Sangha and for transfer of vacant 182 sites from the Sangha to the Inamdars or for payment of compensation in lieu thereof by the Sangha to the Inamdars and the directions in the order dated 22.12.2003 to the BDA to handover the vacant civ....