No lease deed has been executed and registered, respondents are entitled to the benefit of Section 53A of the Transfer of Property Act, 1882; & Sections 30 and 31 of the LAAct and it was held that respondents are entitled to compensation to the extent of 87% whereas Gaon Sabha was held entitled only to the extent of 13%. The said judgment has become final.;

C.A.Nos.9049-9053 of 2011
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.9049-9053 OF 2011
Union of India & Anr. …..Appellants
Versus
M/s. K.C. Sharma & Co. & Ors. …..Respondents
J U D G M E N T
R. Subhash Reddy, J.

  1. The Union of India through Secretary (Revenue) and another,
    have filed these appeals aggrieved by the judgment and decree dated
    21.05.2007 passed by the High Court of Delhi in R.F.A.Nos.204-8/2006.
    By the aforesaid impugned judgment, the High Court has allowed the
    Regular First Appeals, preferred by the respondents, by setting aside
    judgment and decree dated 04.01.2006 passed in Suit No.203 of 2005
    by the Addl. District Judge, Delhi.
  2. Necessary facts in brief are as under :
    The land admeasuring 36 bighas 11 biswas comprising in Khasra
    Nos.14/9, 12, 17, 18, 19, 20/1, 23 and 24 belonged to Gaon Sabha
    Luhar Heri, Delhi. The large extent of land in the village, including the
    aforesaid land, was acquired by the Government by initiating
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    C.A.Nos.9049-9053 of 2011
    proceedings under Land Acquisition Act, 1894 (for short, ‘the Act’). The
    notification under Section 4(1) of the Act was issued on 27.01.1984 and
    declaration under Section 6 of the Act came to be published on
    20.09.1984. By passing the Award bearing No.101/86-87 on
    19.09.1986, possession of the land was taken by the Government. In
    the award proceedings, as the respondents have claimed compensation
    on the ground that the land was given to them on lease by Gaon Sabha,
    the matter was referred to the Civil Court under Sections 30 and 31 of
    the Act, for apportionment of the amount of compensation. In the
    aforesaid reference proceedings, preferred under Sections 30 and 31 of
    the Act, it was the claim of the respondents that as the land was not fit
    for cultivation, it was granted on lease to the respondents to remove the
    “shora” and to make the land fit for cultivation. It is their case that in
    view of the lease granted by the Gaon Sabha, they have spent huge
    amount for removal of “shora” and made the land fit for cultivation, and
    continued in possession by cultivating the same for more than 30 years.
    In the aforesaid proceedings referred under Sections 30 and 31 of the
    Act, the Civil Court has passed the judgment and decree on 28.09.1989,
    declaring that the respondents-claimants are entitled for compensation
    to the extent of 87% and remaining 13% is to be paid to the
    panchayat/Gaon Sabha.
  3. Nearly after three years of the aforesaid judgment and decree in
    the proceedings under Sections 30 and 31 of the Act, some villagers
    have filed Writ Petition No.1408/1992 alleging that the respondents were
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    C.A.Nos.9049-9053 of 2011
    not the lessees of the land in question and they have claimed
    compensation in collusion with ex-Pradhan of the Gaon Sabha. The
    said writ petition was disposed of by the High Court of Delhi on
    21.02.1997. In the aforesaid order the High Court has permitted the
    Additional District Magistrate to intervene in the pending proceedings
    under Section 18 of the Act and place on record the available material to
    substantiate their case. At the same time it was kept open to the legal
    heirs of the original lessee to support their contention that there is a
    lease and they are entitled to claim compensation for the land acquired.
    The relevant portion of the order dated 21.02.1997 passed in the writ
    petition reads as under :
    “We are not to be understood as deciding anything regarding
    the rights of the parties one way or the other. The A.D.M. is
    hereby directed to file his intervention application within one
    month from the date of receipt of this order and the leaned
    Addl. District Judge is directed not to dispose of the
    application for enhancement before a decision is rendered on
    the intervention application of the A.D.M. It will be open to the
    A.D.M. to consider, apart from intervention in the matter,
    whether any separate proceedings are to be initiated or not for
    the recovery of the compensation already paid.”
  4. In view of the observations made by the High Court in the writ
    petition, Gaon Sabha/ Panchayat has filed application under Order 1
    Rule 10 of the Code of Civil Procedure to implead it in the proceedings
    under Section 18 of the Act. In the aforesaid proceedings it was held
    that in view of the judgment and decree passed in proceedings under
    Sections 30 and 31 of the Act holding that the respondents-claimants
    are entitled for compensation to the extent of 87%, the Civil Court has
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    C.A.Nos.9049-9053 of 2011
    held that Panchayat is entitled only to seek enhancement of
    compensation to the extent of their 13% share.
  5. Further, in view of the observations made by the High Court, a suit
    was filed by the appellants, initially before the High Court of Delhi, which
    was subsequently transferred to the Court of Additional District Judge,
    Delhi on the ground of pecuniary jurisdiction and same was numbered
    as Suit No.203 of 2005. The said suit was filed seeking declaration that
    the judgment and decree dated 28.09.1989 was obtained by fraud as
    such they are entitled for recovery of Rs.11,20,707/- with interest @
    18% p.a. In the aforesaid suit mainly it was the case of the appellantsplaintiffs that the said decree was obtained by fraud in collusion with exPradhan, and created a resolution showing that the said land was
    leased in their favour for a period of five years from 04.04.1981. It was
    their specific case that since the ex-Pradhan of the Gaon Sabha was in
    collusion with the respondents-defendants and due to such fraud
    committed by them upon the court they could obtain order and decree
    as such the same was assailed in the suit.
  6. The said suit was decreed by judgment and decree dated
    04.01.2006 and aggrieved by the same respondents-defendants have
    preferred First Appeals in R.F.A.Nos.204-8/2006 before the High Court
    of Delhi. The High Court, by appreciating the documentary and oral
    evidence on record, has come to the conclusion that appellants-plaintiffs
    have not pleaded necessary particulars so as to show how fraud was
    committed upon the court which decided the reference under Sections
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    C.A.Nos.9049-9053 of 2011
    30 and 31 of the Act. Further by recording a finding that Gram
    Panchayat wanted to give the said land on lease to make the land fit for
    cultivation by removing “shora” and the said proposal was signed by all
    the members of the Gaon Sabha and only after approval from the Dy.
    Director, Panchayat, it was put to auction. It was further held by the
    High Court that in the auction proceedings there were as many as six
    bidders and as the bid of the respondents was highest at Rs.89/- per
    acre same was accepted. It is further held by the High Court that the
    proposal regarding acceptance of the bid was also approved by the Dy.
    Director vide letter dated 16.04.1981 and only thereafter respondents
    took possession of the land and paid the money through various receipts
    which are part of the record. Further the High Court has held that the
    entries made in the revenue records support the plea of the respondents
    that they continued in possession by cultivating the land and as, every
    action of the Gaon Sabha from the stage of proposal to create lease and
    acceptance of lease was approved by Dy. Director, there is no case
    made out by the appellants to show that lease was created only with the
    collusion of the ex-Pradhan of the Gaon Sabha. With the aforesaid
    findings the appeals filed by the respondents were allowed and
    judgment and decree of the trial court was set aside. Hence, these civil
    appeals, by plaintiffs.
  7. We have heard Ms. Aishwarya Bhati, learned Additional Solicitor
    General for the appellants and Sri Jayant Bhushan, learned senior
    advocate appearing for the respondents-defendants.
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    C.A.Nos.9049-9053 of 2011
  8. Learned Additional Solicitor General appearing for the appellants
    has mainly contended that respondents have claimed compensation by
    playing fraud. It is submitted that there is no lease deed as such in
    favour of the respondents and the only rights which were conferred on
    the respondents were to remove the “shora” on the land in question so
    as to make the land fit for cultivation. It is submitted that in absence of
    any lease deed executed by the Gram Panchayat in favour of the
    respondents, at best it can be treated as a licence for removal of “shora”
    only and same cannot be treated as a lease. The learned ASG has
    submitted that as the judgment and decree which was questioned in the
    suit was obtained by fraud, the suit was rightly decreed by the trial court
    but same was reversed by the High Court without appreciating their
    case in proper perspective. It is submitted by learned ASG that in any
    event having regard to claim made by the respondents-defendants they
    are not entitled for compensation to the extent of 87%. In support of her
    pleading that as much as the judgment and decree dated 28.09.1989 is
    obtained by fraud and the same is a nullity and it is vitiated, she has
    placed reliance on the following judgments of this Court :
  9. S.P. Chengalvaraya Naidu (Dead) by LRs v. Jagannath (Dead)
    by LRs & Ors.1
  10. A.V. Papayya Sastry & Ors. v. Govt. of A.P. & Ors.2
  11. Madhukar Sadbha Shivarkar (Dead) by LRs v. State of
    Mahrashtra & Ors.3
    1 (1994) 1 SCC 1
    2 (2007) 4 SCC 221
    3 (2015) 6 SCC 557
    6
    C.A.Nos.9049-9053 of 2011
  12. Satluj Jal Vidyut Nigam v. Raj Kumar Rajinder Singh (Dead)
    through LRs4
  13. Shrist Dhawan (Smt.) v. M/s. Shaw Brothers5
  14. Meghmala & Ors. V. G. Narasimha Reddy & Ors.6
    It is submitted that above said case law supports the case of the
    appellants that as the decree was obtained by fraud, same is a nullity
    and vitiated and same can be set aside at any point of time. Further
    learned ASG, in support of her argument that the transaction from the
    Gaon Sabha is to be construed as a licence but not a lease and to draw
    the difference between ‘lease’ and ‘licence’, placed reliance on the
    judgments of this Court in the case of Associated Hotels of India Ltd. v.
    R.N. Kapoor7
    ; C.M. Beena & Anr. V. P.N. Ramachandra Rao8
    ; and
    Bharat Petroleum Corporation Ltd. v. Chembur Service Station9
    .
  15. On the other hand Sri Jayant Bhushan, learned senior counsel
    appearing for the respondents has contended that judgment and decree
    passed in proceedings under Sections 30 and 31 of the Act has become
    final. It is submitted that in view of the finality attained to such judgment
    and decree, only question which arose for consideration in the suit was
    whether such judgment and decree was obtained by fraud or not. In
    support of the plea of fraud, the only contention of the appellants was
    that there was no lease and resolution for grant of lease was obtained in
    collusion with the ex-Pradhan of the Gaon Sabha. It is submitted by
    4 2018 (11) SCALE 383 = (2019) 14 SCC 449
    5 (1992) 1 SCC 534
    6 (2010) 8 SCC 383
    7 (1960) 1 SCR 368
    8 (2004) 3 SCC 595
    9 (2011) 3 SCC 710
    7
    C.A.Nos.9049-9053 of 2011
    learned senior counsel that it is clear from the evidence on record that
    the decision to grant lease of the land was taken by Gaon Sabha and all
    the members are signatories and only after approval of the Dy. Director,
    Panchayat land was leased. It is submitted that lease was granted by
    conducting auction and as much as the original respondent-defendant
    was the highest bidder lease was granted by parting possession to the
    respondents. It is submitted that as the respondents continued in
    possession which is evident from the evidence produced as reflected in
    the revenue records, it is not open for the appellants to plead that
    respondents are to be considered only as licensees but not lessees. It
    is submitted that as the trial court has not properly appreciated the
    evidence on record and decreed the suit, same is rightly set aside by the
    High Court and there are no grounds to interfere with the same. The
    learned senior counsel has submitted that though no lease deed has
    been executed and registered, respondents are entitled to the benefit of
    Section 53A of the Transfer of Property Act, 1882. To support his
    contention, he has relied on judgments of this Court in the case of
    Maneklal Mansukhbhai v. Hormusji Jamshedji Ginwalla & Sons10 and
    Hamzabi & Ors. v. Syed Karimuddin & Ors.11. Further, in support of his
    argument that the fraud has to be established by pleading with sufficient
    proof, he has relied on judgment of this Court in the case of
    Ranganayakamma & Anr. V. K.S. Prakash (D) by LRs & Ors.12
    .
    10 AIR 1950 SC 1
    11 (2001) 1 SCC 414
    12 (2008) 15 SCC 673
    8
    C.A.Nos.9049-9053 of 2011
  16. Having heard the learned counsel on both sides, we have perused
    the material on record.
  17. In this case we are not concerned with the correctness of the
    judgment and decree dated 28.09.1989 passed in the proceedings
    under Sections 30 and 31 of the Act. In the suit filed in Suit No.203 of
    2005 a declaration is sought to the effect that the judgment and decree
    dated 28.09.1989 is obtained by playing fraud. In support of their case
    the only pleading was that there was no lease in fact and same was
    created by creating resolution in collusion with the ex-Pradhan of
    Panchayat. From the material and evidence on record we are in
    agreement with the view taken by the High Court. In view of the rival
    claims for compensation matter was referred under Sections 30 and 31
    of the Act and it was held that respondents are entitled to compensation
    to the extent of 87% whereas Gaon Sabha was held entitled only to the
    extent of 13%. The said judgment has become final. Same was not
    questioned in any appeal. Without filing any appeal against the
    judgment and decree dated 28.09.1989, a separate suit is filed mainly
    on the ground that the said judgment and decree is obtained by fraud.
    From the material placed and evidence produced, it is clear that the land
    in question was ‘banjar’ land having “shora” and Gram Panchayat
    wanted to give the said land on lease to make the same fit for cultivation
    by removing “shora”. Such proposal was agreed to by all the members
    of Gaon Sabha and proposal as such was sent to Dy. Director,
    Panchayat for approval. The Dy. Director of Panchayat has approved
    9
    C.A.Nos.9049-9053 of 2011
    the same by deciding that the minimum bid should be for Rs.75/- per
    acre. Only after receipt of such approval from the Dy. Director,
    Panchayat, land was auctioned on 04.04.1981 for grant of leasehold
    rights. In the auction conducted there were as many as six bidders and
    bid of the respondent was the highest which was at Rs.89/- per acre and
    was accepted. Even such acceptance of proposals was again sent to
    Dy. Director for approval and the Dy. Director vide letter dated
    16.04.1981 approved the acceptance of the bid in favour of the
    respondent for a period of five years. Thereafter the respondent was put
    in possession and he continued in possession by paying bid amount to
    the Gram Panchayat. The revenue records produced also reveal that
    the name of the respondent was entered as possessor and cultivator. In
    the light of such documentary evidence it cannot be said that lease was
    obtained by the respondents in collusion with ex-Pradhan. It is to be
    noted that it was not an act of ex-Pradhan of the Gaon Sabha and from
    the stage of proposal same was approved by the Dy. Director, only
    thereafter by conducting open auction respondents were granted lease.
  18. Though the learned Additional Solicitor General appearing for the
    appellants has relied on several judgments in support of her plea that as
    the judgment and decree was obtained by fraud same is a nullity and
    vitiated, but in a given case whether such decree was obtained by fraud
    or not, is a matter which is to be judged with reference to pleadings and
    the evidence on record. When the judgment and decree is assailed only
    on the ground that lease was created in collusion with the ex-Pradhan,
    10
    C.A.Nos.9049-9053 of 2011
    as the same is contrary to evidence, the only plea of the respondents
    was rightly not accepted by the High Court. As at every stage the
    proceedings for grant of lease were approved by the competent
    authority/Dy. Director, Panchayat, as such it cannot be said respondents
    have obtained lease in collusion with ex-Pradhan of the Panchayat.
    Except such a vague plea, there were no particulars how the fraud was
    played. It is fairly well settled that fraud has to be pleaded and proved.
    More so, when a judgment and decree passed earlier by the competent
    court is questioned, it is necessary to plead alleged fraud by necessary
    particulars and same has to be proved by cogent evidence. There
    cannot be any inference contrary to record. As the evidence on record
    discloses that fraud, as pleaded, was not established, in absence of any
    necessary pleading giving particulars of fraud, we are of the view that no
    case is made out to interfere with the well reasoned judgment of the
    High Court. The case law in this regard submitted by the learned ASG
    for the appellants would not render any assistance to support their plea.
    Further cases referred in the case of Associated Hotels7
    and C.M.
    Beena8
    also will not come to the rescue of the case of the appellants in
    any manner. As it is clear from the evidence that the respondents were
    put in possession and they continued in possession by cultivating the
    land the said judgments would not render any assistance in support of
    the case of the appellants. On the other hand in the case of Maneklal
    Mansukhbhai10 relied on by learned senior counsel for the respondents it
    is clearly held by this Court that defence under Section 53A of the
    11
    C.A.Nos.9049-9053 of 2011
    Transfer of Property Act, 1882 is available to a person who has
    agreement of lease in his favour though no lease has been executed
    and registered. Similar proposition is also approved in the judgment of
    this Court in the case of Hamzabi11 wherein this Court has held that
    Section 53A of the Transfer of Property Act, 1882 protects the
    possession of persons who have acted on a contract of sale but in
    whose favour no valid sale deed is executed or registered. As it is clear
    that respondents were put in possession and the Panchayat has acted
    upon their proposal for grant of lease said case law supports the case of
    the respondents.
  19. For the aforesaid reasons, we do not find any merit in these
    appeals so as to interfere with the impugned judgment. Accordingly,
    these civil appeals are dismissed with no order as to costs.
    ………….…………………………………J.
    [ASHOK BHUSHAN]
    ….…………………………………………J.
    [R. SUBHASH REDDY]
    ….…………………………………………J.
    [M.R. SHAH]
    New Delhi.
    August 14, 2020.
    12