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Wednesday, December 4, 2013

Section 52 of the Transfer of Property Act 1882. Doctrine of lis pendens is based on legal maxim ‘ut lite pendente nihil innovetur’ (During a litigation nothing new should be introduced). A transferee pendente lite is bound by the decree just as much as he was a party to the suit. A litigating party is exempted from taking notice of a title acquired during the pendency of the litigation. = KN Aswathnarayana Setty (D) Tr. LRs. & Ors. …Petitioners Versus State of Karnataka & Ors. …Respondents = published in http://judis.nic.in/supremecourt/imgst.aspx?filename=41041

    Section  52  of  the Transfer of Property Act 1882.     Doctrine of lis  pendens  is  based  on  legal  maxim  ‘ut  lite  pendente nihil innovetur’ (During a litigation nothing new  should  be
      introduced). A transferee pendente lite is bound  by  the
      decree just as much as he was a party to the suit. A litigating  party
      is exempted from taking notice of a title acquired during the pendency
      of the litigation.  =
High Court of Karnataka  at  Bangalore
      in Writ Appeal No.1421 of 2008 etc.  affirming  the  judgment  of  the
      learned Single Judge dated  17.4.2008  passed  in  Writ  Petition  No.
      11502/2006, by which and whereunder the court had quashed  the   order
      dated  27.2.2004,  passed  by  the  Revenue  Minister,  Government  of
      Karnataka de-notifying the suit land from acquisition. pending appeal, the petitioner purchased the land - Doctrine of lis pendens applies - he is bound by the order - he can not claim any independent right but he is entitled for compensation = 

Doctrine of lis  pendens  is  based  on  legal  maxim  ‘ut  lite
      pendente nihil innovetur’ (During a litigation nothing new  should  be
      introduced). 
This  doctrine  stood  embodied  in  Section  52  of  the
      Transfer of Property Act 1882.   
 The principle of ‘lis pendens’ is in
      accordance with the equity, good conscience or  justice  because  they
      rest upon an equitable and just foundation that it will be  impossible
      to bring an action or suit to a successful termination if  alienations
      are permitted to prevail. 
A transferee pendente lite is bound  by  the
      decree just as much as he was a party to the suit. A litigating  party
      is exempted from taking notice of a title acquired during the pendency
      of the litigation. 
However, it must be clear that mere pendency  of  a
      suit does not prevent  one  of  the  parties  from  dealing  with  the
      property constituting the subject matter of the suit. 
The  law  simply
      postulates a condition that the alienation will, in no manner,  affect
      the rights of the other party under any decree which may be passed  in
      the suit unless the property was alienated with the permission of  the
      Court. 
The transferee cannot deprive the successful plaintiff  of  the
      fruits of the decree if  he  purchased  the  property  pendente  lite.

 There is ample evidence on record to show that possession of the
      suit land had been  taken  on  6.9.2002.  In  such  a  fact-situation,
      question of de-notifying the acquisition  of  land  could  not  arise.
      
Thus, the order dated 27.2.2004 could not be passed. 
There cannot be a
      dispute in law that upon possession being taken under Section 16 or 17
      of  the  Act  1894,  the  land  vests  in  the  State  free  from  all
      encumbrances. Thus, in case possession of the  land  has  been  taken,
      application for release of land from acquisition is not  maintainable.
      
Once the land is vested in the State free from encumbrances, it cannot
      be divested.                     

   The petitions are  devoid  of  any  merit  and  are  accordingly
      dismissed.  However, it is made clear that the  petitioners  shall  be
      entitled to compensation as determined under the provisions of the Act
      1894.

   REPORTABLE




                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION


                 SPECIAL LEAVE PETITION (C) No.22311 of 2012


      KN Aswathnarayana Setty (D) Tr. LRs. & Ors.              …Petitioners


                                   Versus


      State of Karnataka & Ors.                              …Respondents


                                    With


                       SLP (C) Nos.22307-22309 of 2012




                               J U D G M E N T


      Dr. B.S. CHAUHAN, J.
      1.    These petitions have been filed against the judgment  and  order
      dated 24.10.2011, passed by the High Court of Karnataka  at  Bangalore
      in Writ Appeal No.1421 of 2008 etc.  affirming  the  judgment  of  the
      learned Single Judge dated  17.4.2008  passed  in  Writ  Petition  No.
      11502/2006, by which and whereunder the court had quashed  the   order
      dated  27.2.2004,  passed  by  the  Revenue  Minister,  Government  of
      Karnataka de-notifying the suit land from acquisition.


      2.    Facts and circumstances giving rise to these petitions are:
      A.    That a preliminary notification under Section 4(1) of  the  Land
      Acquisition Act 1894 (hereinafter  referred  to  as  ‘Act  1894’)  was
      issued in respect of huge  chunk  of  land  including  Survey  No.49/1
      admeasuring 15 Acres  on  6.8.1991  for  the  benefit   of  the  State
      Government   Houseless   Harijan   Employees    Association    (Regd.)
      (hereinafter referred to as ‘Society’).  In respect of the  same  land
      declaration under Section 6 of the Act 1894 was issued on 15.5.1992.
      B.    At the behest of the then owners of the suit land the Government
      de-notified the  land  from  acquisition  vide  order  dated  5.8.1993
      issuing notification under Section 48(1) of the Act 1894.
      C.    Aggrieved the respondent no.3-Society challenged the said  order
      of de-notifying the land from  acquisition  by  filing  Writ  Petition
      which was dismissed by the learned Single Judge. The  said  order  was
      also affirmed  by  the  Division  Bench  dismissing  the  Writ  Appeal
      preferred by the Society. The Society approached this court by  filing
      special leave petitions which were entertained and finally heard Civil
      Appeal No. 5015/1999 etc. and this court vide judgment and order dated
      11.12.2000 quashed the order dated 5.8.1993 de-notifying the suit land
      from acquisition.
      D.    During the pendency of Civil Appeal No.5015 of 1999  etc.  filed
      by the respondent-society, the present petitioners purchased the  suit
      land in the years 1997-1998 and approached the Government of Karnataka
      to de-notify the said land from acquisition. As their application  for
      release was not dealt with by  the  Government,  they  preferred  Writ
      Petition  Nos.19968-97  of  2002  etc.  before  the  High  Court   for
      directions to the Government to release the land.
      E.    The High Court vide judgment and order dated 19.2.2003  disposed
      of the said writ petition, directing the Government  to  decide  their
      application in accordance with law expeditiously.  In pursuance of the
      High Court order, the Government of Karnataka  issued  notice  to  all
      concerned parties and against all  the  parties  the  Hon’ble  Revenue
      Minister passed an order dated 27.2.2004, directing to  de-notify  the
      land from acquisition.
      F.    The order dated 27.2.2004 was not complied with  as  the  Deputy
      Secretary to the Government of Karnataka raised certain objections and
      made an endorsement dated  21.9.2005  that  the  matter  had  attained
      finality after being decided by this Court and possession of the  land
      had already been taken and handed over to  the  respondent-society  on
      6.9.2002, much prior to the order passed by the Hon’ble Minister.
      G.    The present petitioners filed Writ  Petition  No.11502  of  2006
      etc. before the High Court to quash the  endorsement  dated  21.9.2005
      made by the learned Deputy Secretary, Government  of  Karnataka.   The
      writ petition stood dismissed on 17.4.2008 in terms of the judgment of
      the same date in a similar case, i.e. Writ Petition  No.9857  of  2006
      (M.V. Kasturi & Ors. v. State of Karnataka & Ors.).
      H.    Aggrieved, petitioners preferred a  Writ  Appeal  No.  1421/2008
      which has been dismissed by the impugned judgment and order.
            Hence, these petitions.


      3.    Shri Kailash Vasdev, learned senior counsel  appearing  for  the
      petitioners submitted that the courts below have committed an error in
      dismissing the case  of  the  petitioners  as  the  courts  failed  to
      appreciate the legal issues.  This Court set aside the  order  of  de-
      notification dated 5.8.1993 on a technical ground as the order of  de-
      notification was passed without  hearing  the  respondent-society  for
      whose benefit the land had been acquired.  Thus,  there  could  be  no
      prohibition for the State to de-notifying the  land  from  acquisition
      after hearing the concerned parties. More  so,  the  Hon’ble  Minister
      had competence to deal with the acquisition proceedings and  thus  the
      finding recorded by the High Court about his competence  is  perverse.
      More so, as there was no interim order  of  this  court  in  Society’s
      appeal, petitioners could purchase the land.   Hence, these  petitions
      should be accepted.


      4.    Per contra, Shri Rama Jois and Shri K.N.  Bhat,  learned  senior
      counsel for the respondents have opposed the petitions contending that
      this Court has set aside the order  dated  5.8.1993  de-notifying  the
      land  from  acquisition  not  only  on  the  ground  of  violation  of
      principles of natural justice but also on merits as it had  been  held
      by this Court that there was no  justification  for  de-notifying  the
      land.  The present petitioners are purchasers of  land  subsequent  to
      notification under Section 4(1) of the Act 1894, and  they  could  not
      purchase the land at all.  In view of the fact that the  appeal  filed
      by the respondent no.3 against the order dated  5.8.1993  was  pending
      before this Court,  doctrine of lis pendens would  apply.   Thus,  the
      petitions are liable to be  dismissed.
      5.    We have considered the rival submissions  made  by  the  learned
      counsel for the parties and perused the record.
            The facts are not in dispute.
At the time of purchase   of  the
      suit land by the present petitioners the matter was sub-judice  before
      this Court and if the order of de-notification  dated  5.8.1993  stood
      quashed,  it  would  automatically   revive   the   land   acquisition
      proceedings meaning thereby  the  notification  under  Section  4  and
      declaration under Section 6 resurfaced by operation of law.  
In such a
      fact-situation, it is not permissible for the present  petitioners  to
      argue that merely because there was no interim  order  in  the  appeal
      filed by the respondent no.3, petitioners had a right to purchase  the
      land during the pendency of the litigation and would not be  bound  by
      the order of this Court quashing the  de-notification  of  acquisition
      proceedings.


      6.    Doctrine of lis  pendens  is  based  on  legal  maxim  ‘ut  lite
      pendente nihil innovetur’ (During a litigation nothing new  should  be
      introduced). 
This  doctrine  stood  embodied  in  Section  52  of  the
      Transfer of Property Act 1882.   
 The principle of ‘lis pendens’ is in
      accordance with the equity, good conscience or  justice  because  they
      rest upon an equitable and just foundation that it will be  impossible
      to bring an action or suit to a successful termination if  alienations
      are permitted to prevail. 
A transferee pendente lite is bound  by  the
      decree just as much as he was a party to the suit. A litigating  party
      is exempted from taking notice of a title acquired during the pendency
      of the litigation. 
However, it must be clear that mere pendency  of  a
      suit does not prevent  one  of  the  parties  from  dealing  with  the
      property constituting the subject matter of the suit. 
The  law  simply
      postulates a condition that the alienation will, in no manner,  affect
      the rights of the other party under any decree which may be passed  in
      the suit unless the property was alienated with the permission of  the
      Court. 
The transferee cannot deprive the successful plaintiff  of  the
      fruits of the decree if  he  purchased  the  property  pendente  lite.
      [Vide : K. Adivi Naidu & Ors. vs. E. Duruvasulu Naidu & Ors., (1995) 6
      SCC 150; Venkatrao Anantdeo Joshi & Ors. vs. Malatibai & Ors.,  (2003)
      1 SCC 722; Raj Kumar vs. Sardari Lal & Ors., (2004)  2  SCC  601;  and
      Sanjay Verma v. Manik Roy & Ors., AIR 2007 SC 1332).
      7.    In Rajender Singh & Ors. v. Santa Singh  &  Ors.,  AIR  1973  SC
      2537, while dealing with the application of doctrine of  lis  pendens,
      this court held as under:
                 “The doctrine of lis pendens was  intended  to  strike  at
           attempts  by  parties  to  a  litigation   to   circumvent   the
           jurisdiction of a  court,  in  which  a  dispute  on  rights  or
           interests in immovable property is pending by  private  dealings
           which may remove the subject matter of litigation from the ambit
           of the court’s power to decide a pending  dispute  or  frustrate
           its decree.”


      (See also: T.G. Ashok Kumar v. Govindammal & Anr., (2010) 14 SCC 370).


      8.    In view of the above, we are of the considered opinion  that  it
      is not permissible to say that in case the petitioners  had  purchased
      the  suit  property  during  the  pendency  of  the  appeal  filed  by
      respondent no.3 before this Court, the petitioners are  not  bound  by
      the final orders of this Court.
      9.    By operation of law, as this Court quashed  the  de-notification
      of acquisition proceedings,  the  proceedings  stood  revived.
 In  V. Chandrasekaran & Anr. vs. The Administrative Officer & Ors.,  JT  2012
      (9) SC 260, this Court considered the  right  of   purchaser  of  land
      subsequent to the issuance of Section 4  notification  and  held  that
      any one who deals with the land subsequent to a Section 4 notification
      being issued, does so, at his own peril. Section 4 notification  gives
      a notice to the public at large that the land in respect to  which  it
      has been issued, is needed for a public purpose, and it further points
      out that there will be "an impediment to any one to encumber the  land
      acquired thereunder." The alienation  thereafter  does  not  bind  the
      State or the beneficiary under the acquisition. In fact,  purchase  of
      land after publication of a Section 4 notification in relation to such
      land, is void against the State and at the most, the purchaser may  be
      a person-interested in compensation, since he steps into the shoes  of
      the erstwhile owner and  may  therefore,  merely  claim  compensation.
      Thus, the purchaser  cannot  challenge  the  acquisition  proceedings.
      While deciding the said case this court  placed  reliance  on  a  very
      large number of its earlier judgments including Leela Ram v. Union  of
      India & Ors., AIR 1975 SC 2112; Smt. Sneh  Prabha  etc.  v.  State  of
      Uttar Pradesh & Anr., AIR 1996  SC  540;  Meera  Sahni  v.  Lieutenant
      Governor of Delhi & Ors., (2008) 9 SCC 177; and Tika  Ram  &  Ors.  v.
      State of U.P. & Ors., (2009) 10 SCC 689.
      10.   The law on the issue can be summarised  to  the  effect  that  a
      person who purchases land subsequent to the issuance of  a  Section  4
      notification with respect to it, is not  competent  to  challenge  the
      validity of the acquisition proceedings on any ground whatsoever,  for
      the reason that the sale deed executed in his favour does  not  confer
      upon him, any title and at the most he can claim compensation  on  the
      basis of his vendor’s title.
      11.   In order to meet the menace of sale of land after initiation  of
      acquisition proceedings, various States enacted the  Acts  and  making
      such transfers as punishable, e.g., The Delhi Lands  (Restrictions  on
      Transfers) Act, 1972 made the sales permissible only  after  grant  of
      permission for transfer  by  the  authority  prescribed  therein.   In
      absence of such permission if the sale is made in contravention of the
      statutory provisions it is a punishable offence with imprisonment  for
      a term which may extend to 3 years or with fine or with both.
            Therefore, we do not see any cogent reason to  accept  any  plea
      taken by the petitioners that they could purchase the suit  land  even
      subsequent to Section 4 notification.


      12.   We do not find force in the  submission  made  by  Shri  Kailash
      Vasdev, learned senior counsel that this Court  had  quashed  the  de-
      notification of acquisition proceedings only on  technical  ground  as
      the respondent-society was not heard.
             This  Court  in  State  Govt.   Houseless   Harijan   Employees
      Association v. State of Karnataka & Ors., AIR  2001  SC  437  held  as
      under:
           “71. From all this, the ultimate position which emerges is  that
           the  acquisition  in  favour  of  the  appellant  was   properly
           initiated by publication of the Notification under Section  4(1)
           and by the declaration issued under Section 6. The withdrawal of
           the acquisition  under  Section  48(1)  was  vitiated  not  only
           because the appellant was not heard but also because the  reason
           for withdrawal was wrong. The High Court erred in dismissing the
           appellant's writ petition. The decision of  the  High  Court  is
           accordingly set aside. The impugned Notification  under  Section
           48(1)  is  quashed  and  the  appeal  is  allowed  with  costs.”
           (Emphasis added)



      13.   There is ample evidence on record to show that possession of the
      suit land had been  taken  on  6.9.2002.  In  such  a  fact-situation,
      question of de-notifying the acquisition  of  land  could  not  arise.
     
Thus, the order dated 27.2.2004 could not be passed. 
There cannot be a
      dispute in law that upon possession being taken under Section 16 or 17
      of  the  Act  1894,  the  land  vests  in  the  State  free  from  all
      encumbrances. Thus, in case possession of the  land  has  been  taken,
      application for release of land from acquisition is not  maintainable.
      
Once the land is vested in the State free from encumbrances, it cannot
      be divested. (See: LT. Governor of H.P. & Anr. v. Sri Avinash  Sharma,
      AIR 1970 SC 1576; Satendra Prasad Jain & Ors. v. State of U.P. & Ors.,
      AIR 1993 SC 2517;  Mandir Shree Sitaramji alias Shree Sitaram  Bhandar
      v. Land Acquisition Collector & Ors., AIR  2005  SC  3581;   and  Smt.
      Sulochana Chandrakant Galande v. Pune Municipal Transport  & Ors., AIR
      2010 SC 2962).


      14.   In view of the above, we do not think it  necessary  to  examine
      the other issues raised in the petitions particularly, the  competence
      of the Hon’ble Minister to deal with the matter.


      15.   The petitions are  devoid  of  any  merit  and  are  accordingly
      dismissed.  However, it is made clear that the  petitioners  shall  be
      entitled to compensation as determined under the provisions of the Act
      1894.
                                         .........................………………..J.
                                                                (DR.    B.S.
      CHAUHAN)



      .............………………………J.
                                                (S.A. BOBDE)
      New Delhi,
      December 2, 2013














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