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Thursday, September 20, 2012

whether the transfer of land from a member of Scheduled Caste to a juristic person, other than Scheduled Caste, is void, in view of the provisions of Section 42(b) of the Rajasthan Tenancy Act, 1955 (for short ‘the Act’). 3. The High Court of Rajasthan has answered the above question in several cases holding that such a transfer would not be hit by the above mentioned provision, since the expression ‘person’ would not take in a ‘juristic person’ and that juristic person does not have a caste and, therefore, any transfer made by a Scheduled Caste person would not be hit by Section 42(b) of the Act. “7(2). If the khatedar of Scheduled Caste / Scheduled Tribe executes sale to such a person of Scheduled Caste / Scheduled Tribe who is office-bearer of any firm/society/company/legal institution, then the mutation on the basis of registration shall be made only in the name of that particular person/vendee who is a member of Scheduled Caste/Scheduled Tribe and not in the name of that firm/society/company/legal institution wherein he is office-bearer or member.” 17. The above mentioned condition makes it amply clear that the mutation on the basis of registration shall be made only in the name of that particular person/vendee who is a member of Scheduled Caste/Scheduled Tribe and not in the name of any firm/society/company/legal institution wherein a person is office-bearer or member. When we apply the above principles to the transfer of land in question, we have no hesitation to hold that the sale deed effected on 26.9.2005 was void and therefore rightly denied mutation in Revenue records. Property, therefore purchased by the respondent from the members of Scheduled Caste vide sale deed dated 26.9.2005 and other sale deeds, therefore are void since hit by Section 42(b) of the Act and it is so declared. The State can, therefore, re- possess the lands and return the lands to the original owners who are members of Scheduled Caste. Section 42(b) may go against the interest of the members of Scheduled Caste / Scheduled Tribe as well. There may be several situations where they intend to sell the property for purposes like marriage of son/daughter or to purchase a better property and so on, but in that event sometimes they may not get a better competitive price, if the sale is made only among the members of Scheduled Caste / Scheduled Tribe. We have come across legislations where provisions are made enabling them to sell their lands to the members of non-Scheduled Caste / Scheduled Tribe, on getting permission from the prescribed authority. Such a provision may be sometimes helpful to the members of Scheduled Caste / Scheduled Tribe to get a better price for their land but it is for the legislature to incorporate appropriate provision in the Rajasthan Act. 19. Consequently, the appeals are allowed and the judgments of the learned single Judge and the Division Bench of the High Court are set aside. However, there will be no order as to costs.


                                                                  REPORTABLE
                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION
                     CIVIL APPEAL NOS. 6741-6742 OF 2012
            [Arising out of SLP (Civil) Nos. 33006-33007 of 2010]
State of Rajasthan & Others                        .. Appellants
                                   Versus
Aanjaney Organic Herbal Pvt. Ltd.                  .. Respondents
                                    WITH
                        CIVIL APPEAL NO. 6743 OF 2012
               [Arising out of SLP (Civil) No. 14771 of 2011]


                               J U D G M E N T

K. S. RADHAKRISHNAN, J.

   1. Leave granted.


2.    We are, in this case,  called  upon  to  decide  the  question  as  to
whether the transfer of land from a member of Scheduled Caste to a  juristic
person, other than Scheduled Caste, is void, in view of  the  provisions  of
Section 42(b) of the Rajasthan Tenancy Act, 1955 (for short ‘the Act’).

3.    The High Court  of  Rajasthan  has  answered  the  above  question  in
several cases holding that such a transfer would not be  hit  by  the  above
mentioned provision, since the expression  ‘person’  would  not  take  in  a
‘juristic person’ and that juristic  person  does  not  have  a  caste  and,
therefore, any transfer made by a Scheduled Caste person would  not  be  hit
by Section 42(b) of the Act.

4.    In the impugned judgment, reliance  has  been  placed  on  an  earlier
judgment of the High Court of Rajasthan in State of Rajasthan v. Indian  Oil
Corporation 2004 (5) WLC (Raj.) 703, which held as follows:
            “6.    It  goes  without  saying  that  though  the  Indian  Oil
      Corporation is a juristic person but it does not have a  caste.   Thus
      the sale in favour of Indian Oil Corporation by a member of  Scheduled
      Caste is not covered by the provisions of section 42 of the  Rajasthan
      Tenancy  Act.   Thus  taking  into   totality   of   the   facts   and
      circumstances, we feel that it is not a fit case where  the  delay  of
      480 days should be condoned.  The special leave is rejected.”


5.    The judgment in IOC (supra) was challenged before this  Court  by  the
State of Rajasthan in C.C.  No.  19386  of  2010  with  an  application  for
condonation of delay of 2798 days.  This Court dismissed the  petition  with
costs  vide  order  dated  4.1.2011,  since  the  delay  was  not   properly
explained.

6.    We are informed that since the special leave petition, arising out  of
CC No. 19386 of 2010, was dismissed, the judgment in IOC (supra) is  treated
as law so far as the State of Rajasthan is concerned and being  followed  in
various other similar cases. It is,  therefore,  necessary  to  examine  the
various legal issues raised before us  so  as  to  render  an  authoritative
pronouncement on the question posed before us.

7.    The respondent is a  private  limited  company  registered  under  the
Indian Companies Act vide Registration Certificate  of  Incorporation  dated
17.8.2005.  The Company purchased 25 bighas of land in  Khasra  No.  840/651
situated in Village Jetasan Patwar area Jetasan Tehsil,  Rajasthan,  out  of
which 9.73  bighas  belonged  to  the  members  of  Scheduled  Caste.   That
property was purchased  on  26.9.2005  by  a  registered  sale  deed  for  a
consideration  of  Rs.60,000/-.    An  application  was  preferred  by   the
respondent before the Revenue Authorities  for  mutation  of  the  property.
The same was refused placing reliance on a circular dated 19.11.2005,  which
stated that mutation could be effected only if the transfer was between  the
members of Scheduled Caste/ Scheduled Tribe, as the  case  may  be.    Since
the application for mutation was refused, the respondent herein  filed  S.B.
Civil Writ Petition No. 169/2006, which was  allowed  by  a  learned  single
Judge.  Aggrieved by the same, the State  preferred  an  appeal  before  the
Division Bench, being D.B. Civil Writ  Special  Appeal  (Writ)  No.  DR  (J)
1177/2008, which was also dismissed following the judgment in IOC (supra).

8.    Heard learned counsel  on  either  side.   The  Act  is  a  beneficial
legislation which takes special care to protect the interest of the  members
of Schedule Caste and Schedule Tribe.   Section  42  provides  some  general
restrictions on sale, gift and bequest of the interest  of  Scheduled  Caste
and Scheduled Tribe, in the whole or part of their holding.  The reason  for
such general restrictions is not only  to  safeguard  the  interest  of  the
members of Scheduled Caste and Scheduled Tribe, but also to  see  that  they
are not being exploited by the members of non-Scheduled Caste and  Scheduled
Tribe.  The relevant provisions of Section 42(b)  are  extracted  below  for
easy reference:
           “42.  General restrictions on sale, gift & bequest  –  The  sale,
           gift or bequest by a Khatedar tenant of his interest in the whole
           or part of his holding shall be void if
             a) xxxxxxx deleted
             b) Such sale, gift or bequest is by a member  of  a  Scheduled
                Caste in favour of a person who is  not  a  member  of  the
                Scheduled Caste, or by a member of  a  Scheduled  Tribe  in
                favour of a person who is not a  member  of  the  Scheduled
                Tribe.”


9.     Shri  P.P.  Choudhary,  learned  senior  counsel  appearing  for  the
respondent, submitted that the expression ‘person’, as such, is not  defined
in the Act and, therefore, we have to  go  by  the  definition  of  ‘person’
under the General Clauses Act, 1987.  The General Clauses  Act  defines  the
expression ‘person’ as follows:
           “3(42).     ‘Person’ shall include any company or association  of
           body or individuals, whether incorporated or not.”


10.   Learned senior counsel, therefore, submitted that, if it  is  so  read
along with  Section  3(42)  of  the  General  Clauses  Act,  the  expression
‘person’ used in clause (b) of Section 42 of the Act  takes  in  a  juristic
person as well and, therefore, if a member  of  Scheduled  Caste  sells  his
property to a juristic person, the sale cannot be declared as void, since  a
juristic person has no caste.

11.   Dr. Manish Singhvi, learned Additional Advocate General appearing  for
the State of Rajasthan, on the other hand, contended  that  we  cannot  read
Section 3(42) of the General Clauses Act into Section 42(b) of the Act,  out
of context.  Learned counsel submitted that the expression ‘person’ used  in
Section 42(b) of the Act is a natural person and not a juristic  person  and
if the transfer is by a member of Scheduled Caste or Scheduled  Tribe  to  a
person who is not a member of Scheduled Caste or Scheduled Tribe, then  such
a transfer is void under Section 42 of the Act.

12.   Article 341 of the  Constitution  empowers  the  President  by  public
notification to specify the castes, races or tribes  which  shall,  for  the
purpose of the Constitution, be deemed to be Scheduled  Castes  in  relation
to that State or Union Territory  etc.   Article  341  of  the  Constitution
reads as follows:
           “341.        Scheduled  Castes.-  (1)  The  President  may  with
           respect to any State or Union Territory, and where it is a State
           after  consultation  with  the  Governor  thereof,   by   public
           notification, specify the castes, races or tribes or parts of or
           groups within castes,  races  or  tribes  which  shall  for  the
           purposes of this Constitution be deemed to be  Scheduled  Castes
           in relation to that State or Union Territory, as  the  case  may
           be.
           (2) Parliament may by law include in or exclude from the list of
           Scheduled Castes specified in a notification issued under clause
           (1) any caste, race or tribe or part  of  or  group  within  any
           caste, race or tribe,  but  save  as  aforesaid  a  notification
           issued under  the  said  clause  shall  not  be  varied  by  any
           subsequent notification.”



13.   Article 342 of the Constitution  deals  with  ‘Scheduled  Tribes’  and
reads as follows:
           “342.  Scheduled Tribes. – (1) The President may with respect to
           any State or Union territory, and where it  is  a  State,  after
           consultation with the Governor thereof, by public  notification,
           specify the tribes or tribal communities or parts of  or  groups
           within tribes or tribal communities which shall for the purposes
           of this  Constitution  be  deemed  to  be  Scheduled  Tribes  in
           relation to that State or Union Territory, as the case may be.
           (2) Parliament may by law include in or exclude from the list of
           Scheduled Tribes specified in a notification issued under clause
           (1) any tribe or tribal community or part of or group within any
           tribe or tribal community, but save as aforesaid a  notification
           issued under  the  said  clause  shall  not  be  varied  by  any
           subsequent notification.”


14.   The expressions ‘Scheduled Castes’ and “Scheduled Tribes’, we find  in
Section 42(b) of the Act have to  be  read  along  with  the  constitutional
provisions and, if so read, the expression ‘who  is  not  a  member  of  the
Scheduled Caste or Scheduled Tribe’ would mean a  person  other  than  those
who has been included in the public notification as  per  Articles  341  and
342 of the Constitution.  The expression ‘person’ used in Section  42(b)  of
the Act therefore can only be a natural person and not  a  juristic  person,
otherwise, the entire purpose of that section  will  be  defeated.   If  the
contention of the company is accepted, it can purchase land  from  Scheduled
Caste / Scheduled Tribe and then  sell  it  to  a  non-Scheduled  Caste  and
Schedule Tribe, a situation the legislature wanted to avoid.  A thing  which
cannot be done  directly  can  be  not  done  indirectly  over-reaching  the
statutory restriction.

15.   We are, therefore, of the view that the reasoning of  the  High  Court
that the respondent being a juristic person, the sale effected by  a  member
of Scheduled Caste to a juristic person, which does not  have  a  caste,  is
not hit  by  Section  42  of  the  Act,  is  untenable  and  gives  a  wrong
interpretation to the above mentioned provision.

16.   We are also of the view that the Revenue Authorities  rightly  refused
the mutation as per circular dated 9.11.2005.  Condition  No.  7(2)  of  the
circular  was  rightly  invoked  by  the  Revenue  Authorities  in   denying
mutation, which condition is extracted below for easy reference:
           “7(2).      If the khatedar of Scheduled Caste / Scheduled Tribe
           executes sale to such a person of Scheduled  Caste  /  Scheduled
           Tribe who is  office-bearer  of  any  firm/society/company/legal
           institution, then the mutation  on  the  basis  of  registration
           shall be made only in the name of that particular  person/vendee
           who is a member of Scheduled Caste/Scheduled Tribe  and  not  in
           the name of that firm/society/company/legal institution  wherein
           he is office-bearer or member.”


17.   The above mentioned condition makes it amply clear that  the  mutation
on the basis of registration  shall  be  made  only  in  the  name  of  that
particular person/vendee who is a member of Scheduled Caste/Scheduled  Tribe
and not in the name of any firm/society/company/legal institution wherein  a
person is office-bearer or member.  When we apply the  above  principles  to
the transfer of land in question, we have no hesitation  to  hold  that  the
sale deed effected on  26.9.2005  was  void  and  therefore  rightly  denied
mutation  in  Revenue  records.   Property,  therefore  purchased   by   the
respondent from  the  members  of  Scheduled  Caste  vide  sale  deed  dated
26.9.2005 and other sale deeds, therefore are  void  since  hit  by  Section
42(b) of the Act and it is so  declared.   The  State  can,  therefore,  re-
possess the lands and return the  lands  to  the  original  owners  who  are
members of Scheduled Caste.

18.   We may hasten to add, at times,  Section  42(b)  may  go  against  the
interest of the members of  Scheduled  Caste  /  Scheduled  Tribe  as  well.
There may be several situations where they intend to sell the  property  for
purposes like marriage of son/daughter or to purchase a better property  and
so on, but in that event sometimes they may not  get  a  better  competitive
price, if the sale is made only among  the  members  of  Scheduled  Caste  /
Scheduled Tribe.   We have come across  legislations  where  provisions  are
made enabling them to sell their  lands  to  the  members  of  non-Scheduled
Caste  /  Scheduled  Tribe,  on  getting  permission  from  the   prescribed
authority.  Such a provision may be sometimes  helpful  to  the  members  of
Scheduled Caste / Scheduled Tribe to get a better price for their  land  but
it is for the  legislature  to  incorporate  appropriate  provision  in  the
Rajasthan Act.

19.   Consequently, the appeals are allowed and the judgments of the
 learned single Judge and the Division Bench of the High Court are set
aside.  However, there will be no order as to costs.


                                                             ……………………………….J.
                                                   (K.S. Radhakrishnan)



                                                            ..………………………………J.
                                                   (Dipak Misra)
New Delhi,
September 20, 2012

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