“456. Power to restore possession of immovable property. ­ (1) When a person is convicted of an offence attended by criminal force or show of force or by criminal intimidation, and it appears to the Court that, by such force or show of force or intimidation, any person has been dispossessed of any immovable property, the Court may, if it thinks fit, order that possession of the same be restored to that person after evicting by force, if necessary, any other person who may be in possession of the property: Provided that no such order shall be made by the Court more than one month after the date of the conviction. (2) Where the Court trying the offence has not made an order under sub­section (1), the Court of appeal, confirmation or revision may, if it thinks fit, make such order while disposing of the appeal, reference or revision, as the case may be. (3) Where an order has been made under subsection (1), the provisions of section 454 shall apply in relation thereto as they apply in relation to an order under section 453. (4) No order made under this section shall prejudice any right or interest to or in such immovable property which any person may be able to establish in a civil suit.” A bare reading of the Sub­Section 1 of Section 456 clearly indicates that the Trial Court can pass an order for restoration of the possession of the property to the person who was forcibly dispossessed. The proviso no doubt lays down that no such order shall be passed after one month of the date of conviction. The order of the High Court in Miscellaneous Criminal Case No.7799 of 1998 dated 19.09.2008, the order of the Sessions Court in Criminal Revision No.234 of 1998 dated 02.09.1998, the order of the Trial Court in M. J. C. No.1 of 1998 dated 01.05.1998 are set aside and the respondents are directed to handover the possession of the property, which is the subject matter of the case and from which the appellant and his father were forcibly dispossessed, to the appellant within one month of the service by a certified copy of this order upon the respondents

Hon'ble Mr. Justice Deepak Gupta

1
NON­REPORTABLE
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO. 1104 OF 2011
Mahesh Dube      ...Appellant(s)
Versus
Shivbodh and Ors.    ...Respondent(s)
J U D G M E N T
Deepak Gupta, J.
1. Shankar   Prasad   Dube,   father   of   the   respondents   was   a
tenant of Prayag Prasad Dube, father of the appellant.  A suit for
eviction on account of non­payment of rent was filed by Prayag
Prasad Dube against Shankar Prasad.  The suit was decreed.  In
execution of the decree, possession of the house was delivered to
Prayag Prasad Dube on 26.11.1985, and he, put his own lock on
the   house.     On   the   night   intervening   on   26.11.1985   and
27.11.1985,   the   respondents   herein   along   with   their   father
Shankar   Prasad   Dube   and   grandmother   trespassed   into   the
2
house of Prayag Prasad Dube and forcibly took possession of the
house.  Thereafter, Prayag Prasad Dube lodged a report against
the respondents and their father and grandmother Gomti Devi.
Charges   were   framed   against   the   accused.     Gomti   Devi   died
during the pendency of the trial and the respondents along with
their father Shankar Prasad Dube were convicted by the Trial
Court   under   Section   448   of   I.P.C.     The   Trial   Court   while
convicting the respondents and their father also directed that the
case propertybe handed over to the complainant.
2. Thereafter, the respondents and their father filed an appeal
before the Sessions Judge which was dismissed on 18.11.1997.
After dismissal of the appeal, the father of the present appellant
filed an application under Section 456 Cr.P.C. for handing over
the possession of the property to him.  The Trial Court rejected
the application only on the ground that it had been filed beyond
the period of 30 days from the date of order of the Appellate
Court.   ARevision Petition was filed,which was dismissed.   A
petition   under   Section   482   Cr.P.C.   was   filed   before   the   High
Court and the same was also dismissed on 19.09.2008.  Hence,
this appeal. 
3
3. Section 456 of the Cr.P.C. reads as follows:
“456.   Power   to   restore   possession   of
immovable property. ­
(1) When a person is convicted of an offence
attended by criminal force or show of force or by
criminal intimidation, and it appears to the Court
that,   by   such   force   or   show   of   force   or
intimidation, any person has been dispossessed of
any   immovable   property,   the   Court   may,   if   it
thinks fit, order that possession of the same be
restored to that person after evicting by force, if
necessary,   any   other   person   who   may   be   in
possession of the property:
Provided that no such order shall be made by
the Court more than one month after the date of
the conviction.
(2) Where the Court trying the offence has not
made an order under sub­section (1), the Court of
appeal, confirmation or revision may, if it thinks
fit, make such order while disposing of the appeal,
reference or revision, as the case may be.
(3) Where an order has been made under subsection   (1),   the   provisions   of   section   454   shall
apply in relation thereto as they apply in relation
to an order under section 453.
(4) No   order   made   under   this   section   shall
prejudice   any   right   or   interest   to   or   in   such
immovable   property   which   any   person   may   be
able to establish in a civil suit.”
A   bare   reading   of   the   Sub­Section   1   of   Section   456   clearly
indicates that the Trial Court can pass an order for restoration of
the possession of the property to the person who was forcibly
dispossessed.  The proviso no doubt lays down that no such order
shall be passed after one month of the date of conviction. 
4
4. In this case, the Trial Court while convicting the accused
had passed an order directing restoration of the property to the
complainant Shankar Prasad Dube.   In the order, it has been
stated   that   the   property   in   the   case   be   handed   over   to   the
petitioner Prayag Prasad Dube.  Keeping in view of the nature of
the dispute, there is no other case property except the property
whose possession was forcibly taken by the respondents and their
father.Therefore,   no   separate   order   was   required   directing
restoration of possession since such an order had been passed
while convicting the respondents and their father.
5. It seems that after the appeal was filed, the order directing
restoration of the possession was not given effect to.  We may also
make reference to Sub­Section 2 of Section 456 Cr.P.C. which
provides that if the Court trying the offence has not made such
an order, the Court of appeal, confirmation or revision can also
make such an order while disposing of the proceedings pending
before it.  No limitation has been provided for the higher courts to
make such order.  In this behalf, reference may be made to the
5
judgment of this Court in  H.   P.   Gupta   v.  Manohar   Lal   AIR
1979 S.C. 443.
6. In the present case, after the appeal filed by the respondents
and   their   father   was   dismissed,   the   father   of   the   present
appellant applied for handing over possession to him in terms of
the order already passed by the Trial Court while convicting the
respondents and their father, in which eventually, the limitation
of 30 days would not apply.  It would apply only if the Trial Court
had not passed any order in respect of the case property while
convicting the accused. 
7. In   view   of   the   above   discussion,   the   present   appeal   is
allowed.  The order of the High Court in Miscellaneous Criminal
Case   No.7799   of   1998   dated   19.09.2008,   the   order   of   the
Sessions   Court   in   Criminal   Revision   No.234   of   1998   dated
02.09.1998, the order of the Trial Court in M. J. C. No.1 of 1998
dated 01.05.1998 are set aside and the respondents are directed
to handover the possession of the property, which is the subject
matter of the case and from which the appellant and his father
were forcibly dispossessed, to the appellant within one month of
6
the service by a certified copy of this order upon the respondents.
The appeal is allowed accordingly in the aforesaid terms. Pending
application(s), if any, stand(s) disposed of.
………………………..J.
(Sanjay Kishan Kaul)
…………………………J.
(Deepak Gupta)
New Delhi
February 12, 2019

whether in a case of circumstantial evidence inability on the part of the prosecution to establish a motive is fatal to the prosecution case. We would think that while it is true that if the prosecution establishes a motive for the accused to commit a crime it will undoubtedly strengthen the prosecution version based on circumstantial evidence, but that is far cry from saying that the absence of a motive for the commission of the crime by the accused will irrespective of other material available before the court by way of circumstantial evidence be fatal to the prosecution. In such circumstances, on account of the circumstances which stand established by 20 evidence as discussed above, we find no merit in the appeal and same shall stand dismissed.

Hon'ble Mr. Justice K.M. Joseph
1
 Non-Reportable
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO.1697 OF 2009
SUKHPAL SINGH ...APPELLANT(S)
 VERSUS
STATE OF PUNJAB ...RESPONDENT(S)
JUDGMENT
K.M. JOSEPH, J.
1. This appeal by special leave is directed
against the judgment of the High Court
dismissing the appeal filed by the appellant
against his conviction under Section 302 of the
2
Indian Penal code (hereinafter referred to as
the “IPC”) and sentencing to rigorous
imprisonment for life.
2. On 27/06/1993 upon discovery of an
unidentified body near a canal and the case
being registered and upon investigation being
conducted the appellant along with another came
to be charge sheeted and charged with the
commission of offences under Section 302 read
with Section 34 of the IPC. They were also
charged with the offence under Section 201 of
the IPC. Before the trial Court the prosecution
examined PW1 to PW17. The appellant examined
DW1 and DW2. The trial Court convicted the
appellant while it acquitted the co-accused. As
already noticed the High Court has affirmed the
3
conviction and sentence of the accusedappellant.
3. We heard Ms. Aishwarya Bhati, learned
Amicus Curiae and also learned counsel for the
respondent-State.
4. Learned Amicus Curiae contended before us
that the case is based only on circumstantial
evidence. She pointed out that there are three
circumstances which were alleged against the
appellant. Firstly, it is contended that the
prosecution laid store by an alleged extra
judicial confession made by the appellant to PW
4 but she immediately pointed out that the said
extra judicial confession has not been accepted
either by the trial court or by the High Court.
Secondly, it is pointed out that the courts have
relied upon the theory of last seen. The theory
4
of last seen is sought to be proved through the
evidence of PW7, PW8 and PW9. Thirdly, it is
pointed out that the prosecution has sought to
draw support from recovery of .38 caliber gun
apart from cartridges. She would submit that no
reliance can be placed upon the same. Lastly,
she also contended that there is absolutely no
motive for the appellant to commit the murder of
the deceased. In a case of circumstantial
evidence, motive assumes great significance.
Absence of evidence of any motive with the
appellant to do away with the deceased, is fatal
to the prosecution case, runs the argument.
5. Per contra, learned counsel for the State
would submit that the circumstances formed a
complete chain and unerringly point to the guilt
of the appellant. It is further pointed out
5
that the van belonging to the deceased in which
the accused were also seen last by the witnesses
for the prosecution was recovered at the
instance of the appellant. This is besides the
forensic evidence available which would also
establish that this is a case of the murder
committed by none other than the appellant as
the forensic report would show that the bullet
which was recovered from the body of the
deceased was fired from the gun recovered from
the appellant. Recovery was of the gun and also
empty cartridges besides live cartridges. An
attempt is made also to establish that there was
a fight between the deceased and the appellant
going by the injuries noted in the post-mortem
and this pointed to motive.
6
6. We would exclude the circumstance namely,
the extra judicial confession which has not been
given credence to by the courts below. We will
thereafter examine firstly whether the
prosecution has been able to establish the last
seen theory. The case of last seen theory has
been sought to be proved through the testimony
of PW7, PW8 and PW9.
7. P.W.7 is the brother in law of the
deceased. He has deposed that the deceased was
having a taxi and on 26.6.1993 he along with the
deceased was present at the taxi stand. Then
both the accused came there. They asked the
deceased to take them in his taxi and he left
with them. No doubt, in cross examination he
does say that 4 or 5 taxis in addition to their
two taxis were present at the taxi stand. He is
7
not able to give the names of other taxi drivers
or the registered numbers of their vehicles. He
had a separate taxi. There is nothing vital in
his cross examination which could be said to
demolish his examination-in-chief.
8. P.W.8 would state that 2½ years or 3
years ago when he reached village Thandewala, he
found on the canal bank the van of the deceased
where both the accused were sitting in the van.
He was to go to Amritsar so he stopped the van.
He stated that the registration number of the
van was 3332. He stated he knew the deceased
and both the accused. He further stated that
the deceased was not present in the van. He
asked the accused as to where the deceased was
as he wanted to hire his taxi, thereupon the
accused told him that they had some secret work
8
so they did not bring the deceased with them.
He would say after 6 or 7 days he learnt that
dead body of the deceased was recovered. He
made a statement to the police. In cross
examination he also says that he did not say
before the police that he stopped the van as he
was to engage the van to go for holy dip at
Amritsar nor did he state to the police that he
was to hire the van of the deceased. No doubt
there may be minor contradictions but we think
that his evidence has inspired the confidence of
two courts. PW9 is an employee of the cooperative Bank as a gunman. He would say that
on 26/06/1993 he came on a scooter and when he
reached bus adda of village Jabelwali it started
raining, he stopped there. The deceased came
there in his van from Muktsar side. Both the
accused were sitting in the van. On seeing him
9
deceased brought the van near him as he was his
brother-in-law. He asked him to accompany but
PW9 told him that he has scooter. However, it
is deposed that the appellant asked the deceased
to hurry up as he was getting late. Then the
van left towards Kakapura. After the rain
stopped, PW9 went in the same direction and he
saw the van of the deceased turning downstream
of the canal water of Rajasthan Canal. In cross
examination he would say that the canal was at a
distance of half kilometer from Jabelwali bus
stand. Bus stand Jabelwali is at a distance of
8 or 10 kilometers from Muktsar. He would say
that his duty hours in the Bank is from 10.00
a.m. to 5.00 p.m. as gunman. The van of the
deceased he would say came to him at the bus
stand at about 9 a.m.or 10 a.m.. He was at a
distance of 10 to 15 killas from Jabelwali bus
10
stand when it started raining. He stood at the
bus stand for about 15-20 minutes. He left the
bus stand on scooter 5 to 7 minutes after the
van left towards Kakapura. He would say that he
did not know the relation except the appellant’s
wife. It would be noticed that there is no
suggestion in the cross examination however that
he does not know the appellant or that he has
never seen him before.
9. The aforesaid evidence, in our opinion,
which has been believed by the trial court as
well as by the High Court, can be relied upon by
us to conclude that the prosecution has
established that the appellant was indeed last
seen with the deceased before his death and
recovery of the body. The appellant admittedly
was working as a police officer. The next
11
circumstance which has been relied upon by the
courts is the recovery of his service revolver –
the gun along with empty cartridges and live
cartridges. The evidence of PW15- officer would
show that on 09.7.1993, the appellant was
arrested along with co-accused. The Maruti van
belonging to the deceased was also produced and
the same was taken into possession in the
presence of Gurdev Singh and Head Constable
Surinder Singh. He has stated that the
appellant was interrogated. He disclosed that
he concealed .38 bore revolver along with 3 live
cartridges and 2 empty cartridges and
Rs.20,000/- cash in an iron box lying in his
house and same was hidden. The statement was
attested by Gurdev Singh (Sarpanch) and Surinder
Singh. A .38 bore revolver, 2 empty cartridges
and 3 live cartridges were recovered as per the
12
statement from an iron box from the store of his
house. The key was taken out by him from the
almirah by the appellant. The revolver and
cartridges were sealed after making into
parcels. They were taken into possession. A
seal was prepared which is handed over after use
to Gurdev Singh. It is also established from
the statement of PW15, the investigating officer
that after the post-mortem, a bullet was
produced before him. No doubt, the bullet was
recovered at the time of post-mortem on
26.7.1993. The revolver was recovered on
11.7.1993. In cross examination P.W.15 has
spoken about sending the revolver and bullet for
forensic examination. The report of the
Forensic Science Laboratory is to the effect
that the bullet which was marked as B1 has been
fired from .38 bore revolver No.673. This
13
undoubtedly would establish that the bullet
which resulted in the death of the deceased came
from the revolver which was issued to the
appellant.
10. Learned counsel for the appellant in the
light of this clearly incriminating circumstance
drew our attention to the following statement
given by the appellant in his statement under
Section 313 Cr.P.C.
 “I am innocent. I have been falsely
implicated. I was suspended by S.S.P.
Faridkot on 3.5.1993 and was sent to
Police Lines, Faridkot, where I remained
present in the months of May and June
1993 throughout. In May I deposited my
revolver and ammunition, because of my
suspension, in Police Lines, Faridkot.
On 28.6.1993 vide report No.3 in the
Daily Diary I was detailed on duty to go
to the office of D.S.P. Moga, regarding
departmental enquiry. When I returned
14
in the evening, police of P.S. Sadar
Muktsar took me from the Police Lines.
They also collected my revolver and
ammunition from the officials of the
Police Lines, Faridkot. I was detained
for some days in illegal custody and my
formal arrest was shown thereafter and
recovery of revolver and ammunition was
foisted against me. Revolver after
firing in the police station was sent to
Forensic Science Laboratory. Bullet was
also foisted against me.”
11. Apparently the version that is sought to
be set up is that the appellant was under
suspension, and therefore the appellant had
surrendered his revolver and therefore the case
of the recovery of the gun and that the fatal
shot was fired from the gun should not be
believed.
12. There appears to be no evidence to show
however that the appellant was actually placed
15
under suspension as is sought to be claimed by
him in the questioning under Section 313. The
appellant has also not been able to draw our
attention to any evidence adduced by him to
establish that he was in fact placed under
suspension so as to prove that he had
surrendered the gun at the police station prior
to the date of the incident. It may be true
that the investigating officer when questioned
has stated that he does not know whether the
officer was suspended. However, this was the
state of the prosecution evidence. It was
thereupon incumbent upon the appellant to
establish the case through evidence which would
certainly have been available had indeed been
placed under suspension. In the absence of
material to establish the case of suspension we
are not inclined to disturb the concurrent
16
findings by the court which is based on evidence
which establishes that there was a recovery of
the gun along with 2 empty cartridges and 3 live
cartridges on the statement given by the
appellant. Furthermore, as already noticed, the
evidence establishes that the bullet found in
the body of the deceased was fired from the gun
which is allotted to the appellant. That apart
we have already found that there is ample
evidence to show that the appellant was last
seen with the deceased, again, a fact which is
established on the basis of testimony of
witnesses who have been found to be creditworthy
by two courts. In an appeal maintained under
leave under Section 136 this Court would not
ordinarily go into the credibility of the
witnesses whose testimony has inspired the
confidence of the courts.
17
13. The evidence of three witnesses relating to
last seen has been relied upon by two courts. It
may be true that there may be certain minor
contradictions. The credibility of witnesses is
ordinarily not re-visited by this Court in an
appeal by special leave. That apart the
circumstance as to the recovery and what is most
important the report of the forensic laboratory
is clinching. The report of the forensic
laboratory reads as follows:
“One point .38 inch jacketed bullet
marked B/1 contained in parcel ‘A’ has
been fired from .38 inch revolver No.A673.”
14. We are not inclined to place any reliance
on appellant’s version that the gun was actually
surrendered by him and making use of the gun, a
shot was fired and he has been implicated
18
particularly as he has not proved that he has
been placed under suspension. Furthermore, in
fact, P.W.15 has denied the allegation that the
bullet was sent after firing. The only
inevitable conclusion we can reach is that the
gun was recovered from him and the bullet which
has been found to have caused the fatal injury
to the deceased and which was recovered from the
body of the deceased has been fired from the
appellant’s gun.
15. The last submission which we are called
upon to deal with is that there is no motive
established against the appellant for committing
murder. It is undoubtedly true that the
question of motive may assume significance in a
prosecution case based on circumstantial
19
evidence. But the question is whether in a case
of circumstantial evidence inability on the part
of the prosecution to establish a motive is
fatal to the prosecution case. We would think
that while it is true that if the prosecution
establishes a motive for the accused to commit a
crime it will undoubtedly strengthen the
prosecution version based on circumstantial
evidence, but that is far cry from saying that
the absence of a motive for the commission of
the crime by the accused will irrespective of
other material available before the court by way
of circumstantial evidence be fatal to the
prosecution. In such circumstances, on account
of the circumstances which stand established by
20
evidence as discussed above, we find no merit in
the appeal and same shall stand dismissed.
………………………………………….J.
(A.M. Khanwilkar)

 ………………………………………………J.
 (K.M. Joseph)
New Delhi;
February 12, 2019

Sections 376 and 506 of the Indian Penal Code = If we do not place confidence in the deposition of PW4 and PW5 then the case would depend upon the credibility of PW2, the prosecutrix. The incident is alleged to have taken place near a path which has been admitted by the prosecutrix and her aunt PW3 as common path. If indeed the prosecutrix has raised hue and cry as in the case reported in 2013 (9) SCC 113, it is very unlikely that the labourers who are supposed to haunt the common path could not hear it. There is a case of the appellant that the evidence would make out a case of consensual sex. It is true that in the High Court, it is recorded that there is no case of consensual sexual intercourse as such argued but we have to decide the case on the basis of evidence. We would think in the circumstances of this case that the appellant cannot be convicted for the offence under Section 376. It would indeed be unsafe to convict him based on the testimony of the prosecutrix. He would certainly be 24 entitled to the benefit of doubt which is created by the very circumstances which we have referred.The trial Court, in fact, has proceeded to rely upon the testimony of prosecutrix about the appellant threatening her that in case she discloses the incident to anyone she will be killed by the accused. This apparently is related to the incident in December, 1999. In fact, the appellant was specifically charged with criminal intimidation allegedly done on 10/07/2000. The appellant was so charged in alleged furtherance of common intention along with co-accused. The trial Court has also proceeded to convict the coaccused relying on the evidence of the prosecutrix.The High Court has acquitted the co-accused of the charge of criminal intimidation. We have noted that there is no specific charge even framed against the appellant under Section 506 in regard to the alleged incident which took place in December, 1999 and the charge in fact relates only to the acts alleged to have been committed on 10/07/2000.In such circumstances, the appeal is allowed. We set aside the order of conviction and sentence of the appellant by the courts below.

Hon'ble Mr. Justice K.M. Joseph

1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO.2393 OF 2010
PARKASH CHAND ...APPELLANT(S)
VERSUS
STATE OF HIMACHAL PRADESH ...RESPONDENT(S)
JUDGMENT
K.M. JOSEPH, J.
1. This is a criminal appeal by special leave
challenging the order dated 11.5.2010 passed by the
High Court of Himachal Pradesh at Shimla in Criminal
Appeal No.615 of 2002 affirming the conviction of the
appellant under Sections 376 and 506 of the Indian
Penal Code. In short, the case of the prosecution is
as follows:
In December, 1999, the appellant committed rape upon
P.W.2. It is also the further case that P.W.2 was
intimidated by the appellant and another co-accused.
2
The appellant was charged under Sections 376 and 506
IPC read with Section 34 of the Indian Penal Code
and co-accused was charged under Section 506 read
with Section 34 of the IPC. The trial Court found
the case in favour of the prosecution and after
convicting the appellant and co-accused sentenced
the appellant to simple imprisonment for 7 years and
a fine of Rs.10,000/- with default sentence for the
offence punishable under Section 376 of the IPC. He
was also sentenced for 2 years for the offence
punishable under Section 506 IPC. Both the
sentences were to run concurrently. The co-accused
stands acquitted by the High court whereas the
appeal filed by the appellant was unsuccessful.
2. We heard learned counsel for the parties. The
learned counsel for the appellant would point out that
PW2, the prosecutrix was above the age of 16 years.
Learned counsel for the appellant would seek to
extricate the appellant from culpability on the score
that the case of the prosecutrix is based on the FIR
which is lodged 7 months after the alleged commission
3
of the rape. There is delay of 7 months in lodging the
FIR just as in the case of Vijayan v. State of Kerala
2008 (14)SCC 763. In this case also the prosecutrix
was pregnant at the time of filing the complaint. The
FIR was filed on 17.7.2000. whereas the incident is
alleged to have taken place in December, 1999. He
points out that it is allegedly filed after the
prosecutrix told PW1 who accompanied her to Deputy
Commissioner Office, Chamba. It is pointed out that
according to the prosecution on 17.7.2000 when she came
to Chamba to get medicines, she allegedly disclosed the
incident to PW1 and appellant has been implicated
thereafter. It is the case of the appellant that P.W.1
is a resident of the same village and that P.W.1 has
spoken about having met the prosecutrix even earlier
but nothing about the alleged rape was disclosed.
3. Per contra, the learned counsel for the respondentState would point out that there was ample evidence in
the form of testimony of the prosecutrix. Besides that
learned counsel also drew our attention to the evidence
of PW4 before whom the appellant himself made an extra
4
judicial confession. So also attention was drawn to
the evidence of PW5.
4. PW5 has also deposed that the appellant requested
him with folded hands for compromise as he has
committed wrong with PW2, the prosecutrix and he wanted
to keep her and her child as his own.
5. The first question we have to consider is the
impact of delay of nearly 7 months in lodging the
complaint with the police. The appellant seeks support
mainly from the judgment of this Court in the case of
Vijayan v. State of Kerala 2008 (14)SCC 763. The High
court in the impugned judgment has on the other hand
relied upon the judgment of this Court reported in
State of Himachal Pradesh v. Shree Kant Shekari AIR
2004 SC 4404. Therein, this Court has essentially
relied upon the principles about the impact of delay as
noticed by it in the judgment of this Court in
Tulshidas Kanolkar v. State of Goa reported in 2003 (8)
SCC 590 wherein rape was committed on a girl whose
5
mental ability was undeveloped. This is what the court
had to say about the fact of delay.
“……………In any event, delay per se is not
a mitigating circumstance for the
accused when accusations of rape are
involved. Delay in lodging the first
information report cannot be used as a
ritualistic formula for discarding
prosecution case and doubting its
authenticity. It only puts the court on
guard to search for and consider if any
explanation has been offered for the
delay. Once it is offered, the Court is
to only see whether it is satisfactory
or not. In a case if the prosecution
fails to satisfactorily explain the
delay and there is possibility of
embellishment or exaggeration in the
prosecution version on account of such
delay, it is a relevant factor. On the
other hand, satisfactory explanation of
the delay is weighty enough to reject
the plea of false implication or
vulnerability of prosecution case. As
the factual scenario shows, the victim
was totally unaware of the catastrophe
which had befallen her. That being so,
6
the mere delay in lodging of the first
information report does not in any way
render prosecution version brittle.”
6. In Vijayan case (supra) the prosecutrix who was
aged about 17 years was the neighbor of the accused.
In her testimony the prosecutrix set up the case that
accused has raped her when no one else was there in the
house and she was raped in the house. The accusedappellant was alleged to have been told that she need
not worry as he will marry her. She did not give any
complaint either to her parents and police in view of
the promise. She became pregnant and while she was
carrying a child of 7 months, she requested the accused
to marry her. The accused declined. Thereafter a
complaint was filed after 7 months. On these facts
this court noted that no complaint or grievance was
made either to the police or the parents thereto. The
explanation for delay in lodging the FIR was noted
namely that the accused promised to marry her and
7
therefore the FIR was not filed. The Court held as
follows:
“…………In cases where the sole testimony of
the prosecutrix is available, it is very
dangerous to convict the accused, specially
when the prosecutrix could venture to wait
for seven months for filing the FIR for
rape. This leaves the accused totally
defenceless. Had the prosecutrix lodged
the complaint soon after the incident,
there would have been some supporting
evidence like the medical report or any
other injury on the body of the prosecutrix
so as to show the sign of rape. If the
prosecutrix has willingly submitted herself
to sexual intercourse and waited for seven
months for filing the FIR it will be very
hazardous to convict on such sole oral
testimony. Moreover, no DNA test was
conducted to find out whether the child was
born out of the said incident of rape and
that the appellant-accused was responsible
for the said child. In the face of lack of
any other evidence, it is unsafe to convict
the accused.”
8
7. In the case of Kaini Rajan v. State of Kerala
reported in 2013 (9) SCC 113, on 17.9.1997 at about
8.30 a.m. it was alleged the prosecutrix was raped at a
site which was by the side of a public road. It was
the case of the prosecutrix that she tried to make hue
and cry but was silenced by the accused by stating that
he would marry her. Even after this incident he had
sexual intercourse on more than one occasion. The
prosecutrix became pregnant, gave birth to a child and
accused did not keep his promise to marry her. It is
thereafter that on 26.7.1998 nearly 10 months after the
alleged rape that a case was registered. This Court
referred the Vijayan’s case (supra), took note of the
place being on the side of a public road, the aspect of
delayed filing of the report and also the behavior of
the parents of the prosecutrix in not approaching the
family members of the accused for marrying the
prosecutrix and instead lodging the report. The Court
also found that having regard to the site, if the
prosecutrix has made any resistance or made hue and cry
9
it would have attracted large number of people from the
locality. The appeal filed by the accused was allowed.
8. It is in the background of the aforesaid principle
that we must examine the question. P.W. 2 prosecutrix
has undoubtedly stated that her parents had died and
she was left without any brother and sister. She was
brought up by her uncle and aunt. She studied upto 9th
class. On 5.12.1999 while she was coming back at about
5-6 p.m. the appellant who is also the resident of the
same village and who is related to her as brother in
village relation caught hold of her and started
dragging her towards the lonely place in the bushes and
committed rape. She raised hue and cry but nobody was
there at the place of occurrence. The appellant showed
her knife and threatened her to do away with her life
in case she disclose the incident to anybody. She
stated that she was so frightened and ashamed due to
which she did not disclose the incident to anyone.
After staying with her maternal grandmother when she
came back she knew about becoming pregnant. Her aunt
enquired about her womb looking bigger and she told her
10
about the incident. Aunt sent her to the home of her
maternal grandmother. The incident came to be
disclosed by her aunt to P.W.4 who is also maternal
uncle of the prosecutrix. A ‘baradari’ was called.
She was also present. The appellant though called, did
not appear. On 9.7.2000, persons including P.W.4 and
appellant came there and the latter told her that he is
prepared to take her and child to accompany him and
that he would get her and her child recorded as his
wife and child. She accompanied the appellant by
making to understand by matrimonial uncle P.W.4. She
stayed there for one day and two nights. It is
thereafter the accused refused to keep her at his house
and the co-accused also threatened that they will not
keep her in the house and nor would get the child
recorded. In short, she was turned out. She stated
that she requested the accused not to turn her out as
she was pregnant. On 17.7.2000 when she came to Chamba
for getting the medicines, she met P.W.1 the person
whom she described as brother and she told him the
whole incident. She also asked to get the matter
11
reported at the police. It is thereafter that the
complaint was lodged. She states in her cross
examination that it is correct that the path is a
common village path and people used to pass through the
said path. She stated there was none at that time.
She would say that it is correct that the labourers
used to go their house after finishing their labour
work. She made cries at the time when the accused
caught hold of her by showing a knife. She stated that
she had gone to the house of appellant of her own free
will. She volunteered to say that the accusedappellant had giving assurance that she is his wife and
was carrying his child in her womb. She disclosed that
she told her grandmother about the rape and that she
was turned out by the uncle. The grandmother (Nani)
told her to go to the house of the accused-appellant.
It was out of fear that she did not disclose to anyone.
She states that P.W.1 met her for the first time at
Chamba and the incident was also disclosed to him for
the first time. She admits knowing the accused since
her childhood but denied having either played with him
12
or studied with him. She states that when she went to
the house of the appellant, she slept with him during
the night. She stated that she had told the petition
writer that the appellant took her forcibly at the
point of knife and threatened to kill her with the
same. She was confronted with the petition wherein it
was not so recorded. In the petition to the police
also it is her statement she has stated so but it was
found not recorded.
9. We may also notice also the deposition of P.W.1 to
whom according to her, she disclosed for the first time
in July, 2000 and with whom she lodged a complaint. He
stated that it was disclosed by her to him that the
appellant committed rape when she was coming back to
her house after purchasing medicines. He admits that
the uncle of the prosecutrix is alive and he has not
lodged any complaint. He admits that village Dugli to
which place prosecutrix had gone in December, 1999 to
purchase article is scattered within a radius of one
kilometer. He would say that he got drafted in Exhibit
P.A. that prosecutrix had disclosed to him that the
13
appellant had threatened her with knife/dagger in case
she disclosed the incident to anyone. He stated that
this fact was not got drafted in Exhibit P.A.
10. P.W.3 is not only married to uncle of the
prosecutrix but is also the elder sister of her own
mother. She has inter alia stated that when PW.2 after
staying at her maternal grandmother’s house for 3
months and thereafter after coming back after 21/22
days, on noticing that her womb was getting bigger and
on her being questioned about it, she disclosed what
happened in December, 1999 namely, the rape committed
by the appellant. She also stated that out of fear as
well as feeling ashamed this was not disclosed to
anyone. Again, PW 2 was sent back to her maternal
grandmother’s house who is none other than the mother
of PW 3. At that time PW 2 was six months pregnant.
PW 3 would further state that Rattan Chand (who was in
fact examined as PW 4) who is maternal uncle of the
prosecutrix and who is having in laws in her village
visited her house. She claims to have thereupon
disclosed about the rape to him. The prosecutrix was
14
thereupon called back from her maternal grandmother’s
house. A baradari was called. The appellant did not
attend. Thereafter she speaks about her coming to know
that prosecutrix went with the appellant and stayed
with him and was turned out later on. In Cross
Examination she would state that the prosecutrix was
carrying pregnancy of 6 months when the baradari
meeting was called. She disclaims knowledge of the
outcome in the meeting. She admits that the stomach
would start bulging out in 4 months pregnancy. In
further cross she would state that prosecutrix
continued for 15 days at her house after the disclosure
about carrying the child of the appellant and
thereafter she went to maternal grandmother’s house.
She admits that she and her husband (namely, uncle of
prosecutrix) did not lodge any report either with the
Pradhan or the Police. The prosecutrix was brought up
by them from the age of about 2 ½ years. In regard to
the path she denied that there is only path in between
Bhogi and Dugli village. She states there are two to
15
three other paths. She, however, admits that this
path is a common path.
11. PW 4 Rattan Chand however, has a different
version about how he came to know about the matter. He
would state that prosecutrix is related to him. On
5.7.2000 she came to his house at village Panjah. On
inquiry about her womb being bigger than normal she
told him about the forcible sexual intercourse
committed by the appellant in December, 1999 and about
her being threatened with the help of a knife not to
disclose it to anyone. He further states two days
thereafter, namely on, 7.7.2000 he came to the house of
his in-laws in village Bhoga and this fact was
disclosed to the Panchayat member Bhola Ram who
suggested a ‘Baradari’ meeting. In the said baradari
meeting Loki Nand, Kishan Chand, Balo Ram and the
prosecutrix was also there. As the appellant and his
family members did not attend the meeting, the meeting
could not take place. He further states that it was
subsequently decided to report to the matter to the
Police. Two days thereafter, namely, on 9.7.2000 at
16
about 9/10 p.m., appellant and, PW 5 came to his
father-in-law. They wanted to have special talk with
him. It is thereupon that he says that the appellant
requested him with folded hands that since he was the
maternal uncle of the prosecutrix that he has committed
wrong with her by committing forcible sexual
intercourse due to which she became pregnant and the
foetus in her womb belongs to him. He wanted to take
the prosecutrix to his house and wanted to keep her as
his wife and also unborn child and to get them recorded
in the Panchayat Register if they were ready to send
her as his wife. Under compelling circumstances and
having no other way it was decided to send the
prosecutrix as his wife. The prosecutrix was not ready
to go as his wife but she was made to understand and
then she went to the house of the accused-appellant.
She was taken on the same night. She stayed for one
day and two nights. Then she was turned out. In cross
examination he states that he did not report the matter
to any authority when the prosecutrix disclosed the
incident to him. After ‘baradari’ meeting the
17
prosecutrix started living with her Nani. He further
states that the accused-appellant visited his house on
5.7.2000 and at that time Sahib Singh (PW 5), Khelku
Devi and the prosecutrix was also present. The
appellant was accompanied by PW 5.
12. He admits that his statement was recorded by
the police. He states that he did not state to the
police that the prosecutrix told him that the appellant
had met her on the way and that he had committed
forcible sexual intercourse with her.
He further states as follows:
“It is correct that I have not stated
the aforesaid facts to the Police as it
was not disclosed to me by the
prosecutrix”.
No doubt, thereafter it is found that he states as
follows:
“I have not stated to the Police that
the Prosecutrix told me that the
appellant took her to the bushes on the
point of knife on the pretext that the
18
prosecutrix had already stated the said
fact to the police”.
13. In his deposition P.W.5 would state that on
9.7.2000 at about 8.00 p.m. while he was coming back,
the appellant and the co-accused met him. The
appellant requested him with folded hands by taking him
into a side and told him that compromise be got
effected with the prosecutrix because he has committed
wrong with her and the child in her womb is his
offspring. However, in cross examination he would
state as follows:
“Witness Rattan Chand told me that the
accused person want to effect compromise
with the prosecutrix. Accused Prakash
Chand had no talk with me regarding the
aforesaid fact. Similarly, no talk took
place with me and accused Chakknu on the
said fact. It is correct that Rattan
Chand told me about the compromise by
the accused person with the
prosecutrix.”
19
14. There is admittedly a delay of 7 months in
lodging the FIR in the case of alleged rape. If the
case is reported immediately apart from the inherent
strength of the case flowing from genuineness
attributable to such promptitude, the perceptible
advantage would be the medical examination to which the
prosecutrix can be subjected and the result of such
examination in a case where there is a resistance. It
is the case of the prosecution that she raised hue and
cry and therefore apparently she would have resisted.
Possibly, a medical examination may have revealed signs
of any resistance or injuries. In this case the High
Court has proceeded on the basis of testimony of the
prosecutrix and sought to fortify it by the extra
judicial confession made before PW4 and PW5.
15. As far as PW 4 is concerned, his evidence is
based on the prosecutrix going to him on 05/07/2000 and
revealing to him what had happened allegedly in
December 1999 whereas PW3, the maternal aunt of the
prosecutrix clearly says that after prosecutrix told
20
her about the alleged rape and when PW4 came to visit
the same village where his in-laws also resides at that
juncture on 07/07/2000, the factum of the alleged rape
was disclosed to him and he came to know on the said
basis. This is a completely different version from
what PW4 has spoken. If PW3 is to be believed, then
knowledge about the alleged incident was gained by
P.W.4 only on 07/07/2000 and that too from PW3 instead
he sets up the case that on 05/07/2000 the prosecutrix
went to his house and told him about the same. In
fact, even the prosecutrix in her version has no such
case. Rather, the prosecutrix would say that the
incident was disclosed by P.W.3 to P.W.4. This
completely falsifies the version of P.W.4 that on
5.7.2000 the prosecutrix went and told him about the
incident including about the threat of using the knife.
P.W.4 as we have noted in further cross examination
would state that he did not tell the police on the
basis that she had not told him about it. This would
again show that version of P.W.4 that prosecutrix had
went and told him about the incident, cannot be
21
believed. No doubt, P.W. 4 seeks to state that he did
not tell the Police about what the prosecutrix told him
thinking that prosecutrix would have told the police
about it. It does not appear to be safe. In such
circumstances, it may not be safe to draw support from
the alleged extra judicial confession alleged to have
been made by the appellant to him.
16. As far as P.W.5 who again has been believed by
the courts, we would notice that in the cross
examination he categorically states that the appellant
and also co-accused did not ask him for compromise.
This is contrary to his version that on the way back to
his home on 09/07/2000 he met him and he sought for a
compromise. It is also to be noted that PW 4 has
stated in his cross examination that PW5 had met him on
05/07/2000 along with the appellant. This is not
considered by the courts below. We have indulged in a
closer look at the evidence in these proceedings having
regard to the need to do so in view of the fact that
the complaint itself is lodged after 7 months. If the
22
evidence adduced by the prosecution falls short of the
test of reliability and acceptability and as such it is
highly unreliable to act upon it even in an appeal by
special leave, such a critical examination may not be
unwarranted. See decision of this Court in Ganga Kumr
Srivastava v. State of Bihar 2005 (6) SCC 211. Also
when vital evidence is not appreciated, this Court can
interfere. Furthermore, we notice that the trial
court, in fact, proceeded on the basis that the
prosecutrix was not a minor. The High Court finds on
evidence that the prosecutrix was not a minor.
Moreover, we notice that the High court has found as
follows:
“16. ………On 18-8-2000, the prosecutrix
was again brought and was examined by
him and the pregnancy of approximately
36 weeks was detected. There is nothing
in the MLC that the prosecutrix was
habitual of sexual intercourse……”.
However, we find in Exhibit PE which is the MLC dated
18/08/2000, it is clearly stated under the head
‘opinion’ as follows:
23
“The pt. is used to habitual sexual
intercourse”
17. If we do not place confidence in the deposition
of PW4 and PW5 then the case would depend upon the
credibility of PW2, the prosecutrix. The incident is
alleged to have taken place near a path which has been
admitted by the prosecutrix and her aunt PW3 as common
path. If indeed the prosecutrix has raised hue and cry
as in the case reported in 2013 (9) SCC 113, it is very
unlikely that the labourers who are supposed to haunt
the common path could not hear it. There is a case of
the appellant that the evidence would make out a case
of consensual sex. It is true that in the High Court,
it is recorded that there is no case of consensual
sexual intercourse as such argued but we have to decide
the case on the basis of evidence. We would think in
the circumstances of this case that the appellant
cannot be convicted for the offence under Section 376.
It would indeed be unsafe to convict him based on the
testimony of the prosecutrix. He would certainly be
24
entitled to the benefit of doubt which is created by
the very circumstances which we have referred.
18. As far as the charge against the appellant
under Section 376 IPC is concerned, it reads as
follows:
“That in the month of December 1999 at
about 5/6 PM at village Bhoga, you
committed rape upon Kumari ……………at a
place one kilometer away from Dugli
towards Bhoga and thereby committed an
offence punishable under Section 376 IPC
and within my cognizance;
And I hereby direct you accused be tried
on the said charge by this court.”
As far as the charge under Section 506 read with 34 IPC
is concerned, it reads as follows:
“That on 10.7.2000 at village Bhoga, you
alongwith your co-accused in furtherance
of common intention, criminally
intimidated Kumari ……….to do away with
her life and thereby committed an
offence punishable under Section 506 IPC
read with Section 34 IPC and within my
cognizance;
25
And I hereby direct you accused be tried
on the said charge by this Court.”
19. The trial Court, in fact, has proceeded to rely
upon the testimony of prosecutrix about the appellant
threatening her that in case she discloses the incident
to anyone she will be killed by the accused. This
apparently is related to the incident in December,
1999. In fact, the appellant was specifically charged
with criminal intimidation allegedly done on
10/07/2000. The appellant was so charged in alleged
furtherance of common intention along with co-accused.
The trial Court has also proceeded to convict the coaccused relying on the evidence of the prosecutrix.
The High Court has acquitted the co-accused of the
charge of criminal intimidation. We have noted that
there is no specific charge even framed against the
appellant under Section 506 in regard to the alleged
incident which took place in December, 1999 and the
charge in fact relates only to the acts alleged to have
been committed on 10/07/2000. Apart from the fact that
there is no specific charge against the appellant in
26
regard to what happened in December, 1999, we are
inclined to think that the appellant could not be
convicted under Section 506 having regard to the
circumstances which we have already discussed
hereinbefore.
20. In such circumstances, the appeal is allowed.
We set aside the order of conviction and sentence of
the appellant by the courts below. As the appellant is
on bail, the bail bonds of the appellant stands
discharged.
…………………………….CJI.
                                                  (Ranjan Gogoi)
…………………………….J.
                                           (Sanjay Kishan Kaul)
…………………………J.
                (K.M. Joseph)
New Delhi;
February 12, 2019

conversion of leasehold rights into freehold rights = Present being a case of a Government grant by virtue of the Section 2 of the Government Grants Act, 1895, nothing in the Transfer of Property Act, 1882, shall apply or be deemed ever to have applied to any grant or other transfer. The principles contained in the Transfer of Property Act have been applied while construing the Government grants as has been noticed above. But herein issue being Government grant, the principle of merger may not be of much relevance. More so, we having construed the Sale Deed as not having conveyed all rights and interests in the leasehold property, the principle of merger does not in any manner advance the claim of the writ petitioner. The writ petitioner has made an alternative prayer in the writ petition seeking a writ of mandamus directing the respondents to allow/order the conversion of the lease hold rights into freehold rights in respect of the aforesaid plot of land without payment of any amount of alleged unearned increase and or interest due thereon. We having held that writ petitioner is not entitled for refund of conversion charges, we direct the DDA to process the writ petitioner’s application for conversion of the leasehold rights into freehold rights. The Civil Appeal No.1534 of 2019 filed by M/s. Karamdeep Finance and Investment (I) Pvt. Ltd. is disposed of upholding the order of Division Bench, however, with direction to DDA to process the application for conversion in accordance with law. The Civil Appeal No. 1533 of 2019 is dismissed. The parties shall bear their own costs.

Hon'ble Mr. Justice Ashok Bhushan
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 1533 Of 2019
DELHI DEVELOPMENT AUTHORITY ...APPELLANT(S)
VERSUS
M/S. KARAMDEEP FINANCE &
INVESTMENT (I) PVT. LTD. & ORS. ...RESPONDENT(S)
WITH
CIVIL APPEAL NO. 1534 Of 2019
M/S. KARAMDEEP FINANCE &
INVESTMENT (I) PVT. LTD. ...APPELLANT(S)
 VERSUS
DELHI DEVELOPMENT AUTHORITY & ORS. ...RESPONDENT(S)
J U D G M E N T
ASHOK BHUSHAN, J.
These two appeals have been filed against the
judgment dated 30.03.2016 of Delhi High Court by
which judgment Delhi High Court has partly allowed
the LPA No.226 of 2014 (Delhi Development Authority
vs. M/s. Karamdeep Finance and Investment (I) Pvt.
Ltd. and Ors.). The Delhi Development Authority as
1
well as M/s. Karamdeep Finance & Investment (I) Pvt.
Ltd., the writ petitioner have filed these two
separate appeals challenging the same judgment. Both
the appeals have been heard together and are being
decided by this common judgment.
2. The brief facts of the case necessary for
deciding these two appeals are:
2.1 One Shri Trilochan Singh Rana purchased Plot
No.14, Block A-2, Safdarjung Development Area,
New Delhi measuring 725 sq. yards in a public
auction by DDA. A Perpetual Lease Deed was
executed in his favour on 18.03.1970. As per
clause (4)a) of the Perpetual Lease Deed, the
lessee was not entitled to sell, transfer,
assign or otherwise part with the possession
of the whole or any part of the plot except
with previous consent in writing of the
lessor, that is, the President of India. In
the event of the consent being given, the
lessor was entitled to impose such terms and
conditions as he deems fit and the lessee was
2
under an obligation to pay 50% unearned
increase of the market value of the plot (i.e.
the difference between the premium paid and
the market value) of the residential plot at
the time of sale, transfer, assignment, or
parting with the possession.
2.2 On 29.09.1988, Shri Trilochan Singh Rana
entered into an agreement to sell the said
property to M/s Ocean Construction Industries
Pvt. Ltd. The application in Form 37-I for
sale of the said property was filed on
06.10.1988 under Section 269UD of Income Tax
Act, 1961 seeking NOC from the Appropriate
Authority, Income Tax Department. Later, an
order under Section 269UD(1) of the Income Tax
Act, 1961 was passed by the Appropriate
Authority for compulsory acquisition of the
property at Rs.76,00,000/- on 13.12.1988.
2.3 Thereafter, the DDA (Finance Member) vide
letter dated 12.01.1989 required the Chief
3
Commissioner (Tech.) Income Tax Department,
Central Revenue Building, New Delhi, to pay an
amount towards unearned increase to the extent
of Rs.17,88,114.55. The Chief Commissioner,
Income Tax Department vide his letter dated
30.01.1989 remitted a cheque for
Rs.17,86,420/- favouring Delhi Development
Authority towards payment of unearned increase
in respect of said property.
2.4 The said property was put to public auction on
20.03.1989 and M/s. Karamdeep Finance &
Investment (I) Pvt. Ltd. (hereinafter referred
to as the “writ petitioner”), the
appellant(writ petitioner) was the highest
bidder for an amount of Rs.1,08,05,000/-. The
said bid was accepted by the Department. The
writ petitioner was put in actual physical
possession of the said property on 25.04.1989.
On 25.09.1997, a registered Sale Deed was
executed in favour of the writ petitioner by
the President of India through the Director,
Department of Revenue, Ministry of Finance.
4
2.5 The writ petitioner moved an application with
the DDA for conversion of leasehold rights in
the plot into free-hold rights and also
deposited a sum of Rs.3,45,729/- as conversion
charges with the DDA. On receipt of the
application for conversion, the DDA calculated
the 50% amount of unearned increase of the
market value and intimated the same (i.e.
Rs.48,16,853/-) to the auction-purchaser i.e.
the writ petitioner. Thereupon, the DDA by a
letter dated 28.04.2000 raised a demand of
Rs.1,43,90,348/-.
2.6 Thereafter, the writ petitioner filed a Writ
Petition being W.P.(C)No.4152 of 2000 before
Delhi High Court. The learned Single Judge
vide its order dated 26.09.2013 had allowed
the writ petition and the demand of
Rs.1,43,90,348/- raised by the DDA vide demand
letter dated 28.04.2000 was set aside being
illegal and also directed the DDA to return
the amount of Rs.3,45,729/-, which had been
5
deposited by the writ petitioner towards the
conversion charges with interest.
2.7 Thereafter, the DDA filed a Letters Patent
Appeal i.e. LPA No.226 of 2014 before the
Delhi High Court against the judgment and
order dated 26.09.2013 passed by the learned
Single Judge in W.P.(C)NO.4152 of 2000.
2.8 The Delhi High Court passed the impugned
judgment and final order dated 30.03.2016 in
LPA No.226 of 2014 vide which the direction of
learned Single Judge in W.P.(C)No.4152 of 2000
to refund the amount of conversion fee paid by
the writ petitioner has been set aside and
partly allowed the appeal of the appellant-DDA
and also held that the unearned increase is
not payable by the purchaser to the DDA.
Both the parties being aggrieved by the
judgment of the Division Bench has filed these
appeals.
3. We have heard Shri Aman Lekhi, learned Addl.
6
Solicitor General for the DDA. Shri Dhruv Mehta,
learned senior counsel has appeared for M/s.
Karamdeep Finance & Investment (I) Pvt. Ltd. We have
also heard learned counsel for the Union of India.
4. Shri Aman Lekhi, learned Addl. Solicitor General
submits that both the learned Single Judge and
Division Bench erred in setting aside the demand
raised by the DDA of unearned increase. It is
submitted that admittedly the property in question
was leasehold property leased out to Shri Trilochan
Singh Rana. The interest of Shri Trilochan Singh Rana
was acquired under Chapter XXC of the Income Tax Act,
1961. In the auction notice which was issued by the
competent authority, the leasehold rights of the
property were sought to be put for auction. The writ
petitioner could not have purchased in auction
anything more than the leasehold rights. The
depositing of conversion charges by the writ
petitioner itself indicates that the understanding
was that they have purchased in auction only the
leasehold rights. The view of the High Court that the
7
unearned increase is liable to be paid only in case
of voluntary transfer is erroneous. The liability to
pay unearned increase is fasten on all transfers. The
writ petitioner being the highest bidder of the
auction was liable to pay unearned increase. The
value of the property having substantially increased
the unearned increase ought to have been paid and
both the Single Judge and the Division Bench erred in
setting aside the demand of unearned increase.
5. Shri Dhruv Mehta, learned senior counsel
appearing for the writ petitioner refuting the
submissions made by the learned counsel for the
appellant-DDA supported the judgment of the High
Court in so far as it held that there is no liability
to pay unearned increase on the auction-purchaser. He
submits that there was no condition in the auction
notice that unearned increase is to be paid by the
auction-purchaser. More so unearned increase was paid
by the Income Tax Department earlier which has been
noticed in the conveyance deed itself, unearned
increase having been paid when the Income Tax
8
Department acquired the property there was no
occasion to make any further payment by auctionpurchaser. In support of the appeal filed by the writ
petitioner, Shri Mehta submits that what was conveyed
to the auction-purchaser is not a leasehold right but
absolute right to the property. The auction-purchaser
having become absolute owner of the property, there
was no occasion to pay any conversion charge. It is
submitted that it was under some mis-conception that
the writ petitioner had deposited the conversion
charges under some bona fide mistake. Hence, they
filed a writ petition for refund of the conversion
charges which were deposited by them under bona fide
mistake. He submits that competent authority having
acquired the right of the property under Chapter XXC
of the Income Tax Act, the leasehold rights are also
vested in the Government. There is merger of
leasehold rights in the lessor, the Government. The
lesser right having been merged in the higher right,
the principle of merger becomes applicable. What was
sold to the writ petitioner was absolute right. The
lease came to end when Income Tax Department
9
purchased the property.
6. Shri Mehta further referring to the Sale Deed
executed in favour of the writ petitioner, submits
that Clause 1 and Clause 2 of the Lease Deed clearly
vest absolute right to the aforesaid property in
favour of the vendee. He further submits that Clause
3 of the Sale Deed which refers to terms of agreement
for transfer dated 29.09.1988 between transferor and
M/s. Ocean Construction Industries is not compatible
with Clauses 1 and 2 and hence has to give way to the
Clauses 1 and 2. He submits that Sale Deed read as a
whole clearly indicates that what was sold was
absolute right.
7. Shri Aman Lekhi making his submission in
rejoinder contends that condition of the auction of
the property under which the writ petitioner was
declared the highest bidder itself mentions that what
was proposed to be sold was leasehold rights. He has
referred to auction notice and submits that mention
of leasehold rights with regard to present property
in question and mention of an absolute right with
10
regard to certain other properties clearly indicates
that in the auction notice what was proposed to be
transferred was leasehold rights of the property in
question. He further submits that the principle of
merger is inapplicable since necessary conditions of
merger are not fulfilled in the present case. The
Income Tax Department which acquired the property was
not in the capacity of lessor, hence, the condition
is not fulfilled. He submits that conveyance deed in
favour of writ petitioner has to be construed as a
whole. The document cannot be construed in part. He
submits that Clause 11 and some other Clauses mention
“ground rent” etc. which indicates that there is no
question of absolute sale. The property is never
vested in the writ petitioner, the depositing of
conversion charges itself indicated that the writ
petitioner is aware of what he purchased is only
leasehold rights. The Division Bench has rightly held
that writ petitioner is liable to pay conversion
charges.
8. Learned counsel for the parties have relied on
11
various judgments of this Court and Delhi High Court
which shall be referred to while considering the
submissions in detail.
9. From the pleadings of the parties and submissions
made before us, following are the two issues, which
arises for consideration:-
(i) Whether writ petitioner was liable to pay
unearned increase in value of the property
to the DDA?
(ii) Whether writ petitioner was entitled to get
refund of conversion charges deposited by
it?
Issue No.1
10. In Perpetual Lease, granted to Shri Trilochan
Singh Rana and Mrs. Rani Rana, one of the conditions
provided that lessor may impose conditions to claim
and recover a portion of the unearned increase in the
value (i.e. the difference between the premium paid
and the market value) of the residential plot at the
time of sale, transfer, assignment or parting with
the possession, the amount to be recovered being
12
fifty percent of the unearned increase. The relevant
clause (4)(a) of the Perpetual Lease is as follows:-
“(4)(a) The Lessee shall not sell, transfer
assign or otherwise part with the
possession of the whole or any part of the
residential plot except with the previous
consent in writing of the Lessor which he
shall be entitled to refuse in his absolute
direction.
Provided that such consent shall not be
given for a period of ten years, from the
commencement of the Lease unless, in the
opinion of the Lessor, exceptional
circumstances exist for the grant of such
consent.
Provided further that in the event of the
consent being given, the Lessor may impose
such terms and conditions as he thinks fit
and the Lessor shall be entitled to claim
and recover a portion of the unearned
increase in the value (i.e. the difference
between the premium paid and the market
value) of the residential plot at the time
of sale, transfer, assignment or parting
with the possession, the amount to be
recovered being fifty percent of the
unearned increase and the decision of the
Lessor in respect of the market value shall
be final binding.”
11. We have already noticed above that original
lessee Trilochan Singh Rana entered into agreement of
sale with M/s. Ocean Construction Industries Pvt.
Ltd. dated 29.09.1988 to transfer the rights for a
13
consideration of Rs.76,00,000/-. Exercising power
under Section 269UD of Income Tax Act, 1961,
appropriate authority passed a purchase order dated
13.12.1988 of the property in question. After the
aforesaid purchase order an amount of Rs.17,86,240/-
towards payment of unearned increase was paid to the
DDA by Income Tax Department. After the aforesaid
purchase order, auction notice dated 20.03.1989 was
issued giving details of the properties, which
included the property in question. In pursuance of
the auction notice, the writ petitioner gave highest
bid and was declared auction purchaser for an amount
of Rs.1,08,05,000/-. The writ petitioner paid the
full amount and was delivered the possession on
25.04.1989. Sale Deed was also executed in favour of
writ petitioner on 25.09.1997. The petitioner made
an application to the DDA for grant of freehold
rights and also deposited amount of Rs.3,45,729/-.
While processing the application for conversion of
leasehold rights to free hold rights, DDA made a
demand of Rs.1,43,90,348/- towards unearned increase,
which was challenged by the writ petitioner. Whether
14
the writ petitioner was liable to pay unearned
increase payment is the question to be answered.
12. We have already noticed the clause (4)(a) of the
Perpetual Lease Deed dated 18.03.1970, which provided
that in event sanction is given by lessor to the
lessee for sale, transfer or assignment, lessor shall
be entitled to claim and recover a portion of the
unearned increase in the value. The unearned
increase being the difference between the premium
paid and the market value. The object behind the
said clause was that a lessee when is permitted to
transfer the leasehold rights, the lessor should not
be deprived of the difference between the premium
paid and the market value. The clause was inserted
in the Perpetual Lease to compensate the lessor. The
present is not a case where lessee is making any
transfer or seeking any permission from the lessor to
give his consent. In the present case, the
appropriate authority has exercised its power under
Section 269UD of the Income Tax Act for the purchase
of the property by the Central Government. It is by
15
exercise of statutory power that rights of lessee
were purchased by Central Government. Central
Government issued auction notice for auction of
property in question. All bids in auction of a
property are given normally to match the market price
of the property. When the petitioner gave highest
bid and became the successful auction purchaser, the
auction purchase has to be treated on the basis of
market value of the property. Clause (4)(a) of
Perpetual Lease as noted above provided for payment
of unearned increase to cover up the difference
between premium paid and the market value. When the
auction was made on the market value of the property,
we are of the view that there was no question of
claim of unearned increase by the DDA. We further
noticed that on purchase of the property under
Section 269UD of the Income Tax Act, the Income Tax
department has already paid unearned increase to the
DDA. We, thus, are of the view that High Court has
rightly held that DDA was not entitled to raise any
demand of unearned increase from the writ petitioner.
16
We, thus, do not find any merit in the appeal filed
by the DDA, which deserves to be dismissed.
Issue No.2
13. The submission, which has been much pressed by
learned counsel for the writ petitioner is that, what
was sold to writ petitioner by Sale Deed dated
25.09.1997 was absolute rights with all rights and
interests in the property. The sale in favour of
writ petitioner was not sale of leasehold rights
rather it was for all rights, title and interests,
hence writ petitioner acquired freehold rights. It
is submitted that application for conversion of
leasehold rights into freehold rights and deposit of
the amount on the said application by writ petitioner
was under bonafide mistake. He submits that in the
writ petition, the petitioner has alternatively
prayed for refund of the amount paid for conversion.
14. Learned counsel for the petitioner has relied on
Clauses 1 and 2 of the Sale Deed, which are to the
following effect:-
17
“1. That in pursuance of the said auction
and consideration of the sum of Rs.
1,08,05,000/- (Rs. One Crore Eight Lakh and
Five Thousand only) already paid by the
Vendor/Auction Purchaser to the Vendor as
aforesaid, the receipt of which the Vendor
hereby acknowledged, the Vendor hereby
transfers, conveys and sells to the Auction
Purchaser, the Vendee, by way of sale of
that plot of land measuring 725 sq. yds.
bearing No. 14 in Block A-2 in the lay out
plan of Safdarjung Development Scheme, Ring
Road, South Delhi (Villages Mohammadpur
Munirka and Humayunpur Revenue Estate,
together with all rights, titles,
interests, appurtenances, easements,
privileges in and pertaining to the
aforesaid property in favour of the Vendee
absolutely and forever, with the provisions
of Section 269UE(1) of the Income Tax Act,
1961 and all the powers rights and
interests vested in the Vendor with regard
to the sale, transfer and conveyances of
the aforesaid property to the Vendee
hereto.
2. That on the execution of this sale deed,
the Vendee has become the absolute and
exclusive owner of the property hereby
sold, conveyed and transferred to it and
that the Vendee shall have absolute rights
and title to the same and to deal with the
property in any manner it likes. It is made
clear that the Vendor has no right and is
left with no……………interest, claim or title
of any nature whatsoever into on upon the
aforesaid property.”
18
15. A plain reading of the above clauses does give
impression that what was sold to the writ petitioner
was all rights, titles, interests and appurtenances
but when we read Clause 3 of the same Sale Deed, the
said clause gives a different impression. Clause 3
of the Sale Deed is as follows:-
“3. That the Vendor hereby represents and
assures to the Vendee that his right in the
property hereby sold, transferred and
conveyed is in terms of agreement for
transfer dated 29-9-1988 between Mr.
Trilochan Singh Rana and Mis, Rani Rana
transferor and M/s. Ocean Construction
Industries Pvt. Ltd. (through its Director
Shri Jugal Kishore Malhan) transferee.”
16. The principles of construction of documents are
well settled. While construing the
documents/intention of the parties have to be
ascertained. In this context, reference is made to
judgment of this Court in Sahebzada Mohammad Kamgarh
Shah Vs. Jagdish Chandra Deo Dhabal Deb and Others,
AIR 1960 SC 953. In Paragraph Nos. 12 and 13,
following was laid down:-
“12. In his attempt to establish that by
this later lease the lessor granted a lease
even of these minerals which had been
excluded specifically by Clause 16 of the
earlier lease, Mr Jha has arrayed in his
19
aid several well established principles of
construction. The first of these is that
the intention of the parties to a document
of grant must be ascertained first and
foremost from the words used in the
disposition clause, understanding the words
used in their strict, natural grammatical
sense and that once the intention can be
clearly understood from the words in the
disposition clause thus interpreted it is
no business of the courts to examine what
the parties may have said in other portions
of the document. Next it is urged that if
it does appear that the later clauses of
the document purport to restrict or cut
down in any way the effect of the earlier
clause disposing of property the earlier
clause must prevail. Thirdly it is said
that if there be any ambiguity in the
disposition clause taken by itself, the
benefit of that ambiguity must be given to
the grantee, the rule being that all
documents of grants must be interpreted
strictly as against the grantor. Lastly it
was urged that where the operative portion
of the document can be interpreted without
the aid of the preamble, the preamble ought
not and must not be looked into.
13. The correctness of these principles is
too well established by authorities to
justify any detailed discussion. The task
being to ascertain the intention of the
parties, the cases have laid down that that
intention has to be gathered by the words
used by the parties themselves. In doing so
the parties must be presumed to have used
the words in their strict grammatical
sense. If and when the parties have first
expressed themselves in one way and then go
on saying something, which is
irreconcilable with what has gone before,
the courts have evolved the principle on
the theory that what once had been granted
20
cannot next be taken away, that the clear
disposition by an earlier clause will not
be allowed to be cut down by a later
clause. Where there is ambiguity it is the
duty of the Court to look at all the parts
of the document to ascertain what was
really intended by the parties. But even
here the rule has to be borne in mind that
the document being the grantor’s document
it has to be interpreted strictly against
him and in favour of the grantee.”
17. This Court further in Paragraph No.14 has held
that in cases of ambiguity, several parts of the
document have to be examined to find out what was
really intended by the parties. In Paragraph No. 14,
following was laid down:-
“14. …………………………………In cases of ambiguity it
is necessary and proper that the court
whose task is to construe the document
should examine the several parts of the
document in order to ascertain what was
really intended by the parties. In this
much assistance can be derived from the
fourth condition of the conditions which
were imposed by the lease as regards the
grant of sub-leases. This condition
provided inter alia that all such underleases to be granted by the lessee shall be
subject to the provisions of Clause 16 of
the principal lease………………………………………”
18. Before we construe the document, we need to first
notice the auction notice by which the property was
21
put to auction. Auction notice, which has been
brought on the record as Annexure-R1 indicate that
details of four properties were given in the auction
notice. It is useful to look into the details given
as follows:-
Details of Properties Reserve
Price
1. Property No. B-6, Friends
Colony Mathura Road, New
Delhi.
This is a lease hold
residential plot measuring
195.097 sq. Mt. together with
buildings and structure
thereon and fixtures and
fitting therein
34.20 lacs
2. Property No. 14, Block A-2,
Safdarjung Development Area,
New Delhi.
This is a lease hold
residential plot measuring
(725 sq. yds.) with a double
storeyed building. The Ground
Floor consists of drawing
dining bed room, kitchen and
a garage. The First Floor
consists of 3 bed rooms, 3
bath rooms, store and a lobby
over the garage. There are 2
floors each having a servant
room W.O. and a cocking
verandah.
1.08 crores
3. Property No. A-8/23, Vasant
Vihar, New Delhi.
This is a lease hold
residential plot N. 23 in
Street No. A-8 in the lay out
plan of Vasant Vihar of the
36.60 Lacs
22
Government Servants
Cooperative. House Building
Society Ltd., and measuring
150 Sq. yds alongwith the
super structure build
thereon. (Covered area 1350
Sq. Ft).
4. Property bearing House No. E444 (Ground Floor), Greater
Kailash Part-II, New Delhi110048.
All rights, titles and
Interests in the dwelling
unit on ground floor, and
mazanine floor of House No.
E-444, Greater Kailash, PartII, New Delhi, together with
undivided. Indivisible and
impartible ownership right of
35% in the land underneath of
the said building and
including the followings :-
1. One drawing-cum-dining
hall, three bed rooms with
attached bath rooms,
balcony, kitchen, storage
space (servants Quarters)
and servant's bath rooms on
ground floor.
2. Front lawn and back
courtyard on the ground
floor.
Parking space for a Maruti
Car in the Driveway.
Ingress and Egress from the
main gate to the dwelling
unit.
25.60 lacs
23
19. A perusal of the details of the properties
indicate that property in question is included as
Item No. 2, which is mentioned as “This is a lease
hold residential plot”. It is to be noticed that in
so far as properties at Sl. Nos. 1, 2 and 3, the
words mentioned are “leasehold residential plots”
whereas with regard to property details given at Sl.
No.4, it has been mentioned that “all rights, titles
and interests in the dwelling unit”, which, if
contrasted with details of properties given at Sl.
Nos. 1, 2 and 3 contains the intendment. Thus, there
cannot be any doubt that property in question, which
was put in auction was a property as lease hold
rights residential plots. When property is
auctioned, the terms and conditions of auction are
binding on both the parties. When petitioner
submitted his bid in pursuance of the auction notice,
he was bidding for lease hold residential plot with a
double storied building. While interpreting the Sale
Deed, the auction notice has to be looked into to
find out the nature of transaction. The Sale Deed
cannot be read divorced to the auction notice or
24
contrary to auction notice. Auction of a leasehold
residential plot and auction of freehold residential
plot carries different connotations. Leasehold
rights are limited rights, which are subservient to
freehold rights of a property. In giving bid for
leasehold rights and freehold rights, different
considerations are there. Clause 3 as noted above
indicate that the property sold and transferred is in
terms of the agreement dated 29.09.1988 between
Trilochan Singh Rana and Mrs. Rani Rana to M/s. Ocean
Construction Industries Pvt. Ltd. Trilochan Singh
Rana and Mrs. Rani Rana were only lease holders.
Thus, they could best transfer their right, which was
conferred to them by the Indenture dated 18.03.1970.
Learned counsel for the writ petitioner has submitted
that Clause 3 being clearly contradictory to Clauses
1 and 2 has to give way to earlier clauses in the
Sale Deed. He has placed reliance on judgment of
this Court in Radha Sundar Dutta Vs. Mohd. Jahadur
Rahim & Ors., AIR 1959 SC 24. In Paragraph Nos. 11
and 13, following was laid down:-
“11. Now, it is a settled rule of
interpretation that if there be admissible
25
two constructions of a document, one of
which will give effect to all the clauses
therein while the other will render one or
more of them nugatory, it is the former
that should be adopted on the principle
expressed in the maxim “ut res magis valeat
quam pereat”. What has to be considered
therefore is whether it is possible to give
effect to the clause in question, which can
only be by construing Exhibit B as creating
a separate Patni, and at the same time
reconcile the last two clauses with that
construction. Taking first the provision
that if there be other persons entitled to
the Patni of lot Ahiyapur they are to have
the same rights in the land comprised in
Exhibit B, that no doubt posits the
continuance in those persons of the title
under the original Patni. But the true
purpose of this clause is, in our opinion,
not so much to declare the rights of those
other persons which rest on statutory
recognition, but to provide that the
grantees under the document should take
subject to those rights. That that is the
purpose of the clause is clear from the
provision for indemnity which is contained
therein. Moreover, if on an interpretation
of the other clauses in the grant, the
correct conclusion to come to is that it
creates a new Patni in favour of the
grantees thereunder, it is difficult to see
how the reservation of the rights of the
other Patnidars of lot Ahiyapur, should
such there be, affects that conclusion. We
are unable to see anything in the clause
under discussion, which militates against
the conclusion that Exhibit B creates a new
Patni.
13. We must now refer to the decision on
which the learned Judges in the Court below
have relied in support of their conclusion.
In Kanchan Barani Debi v. Umesh Chandra,
26
AIR 1925 Cal. 807, the facts were that the
Maharaja of Burdwan had created a Patni of
lot Kooly in 1820. The Choukidari Chakran
lands situated within that village were
resumed under the Act and transferred to
the Zamindar who granted them in 1899 to
one Syamlal Chatterjee in Patni on terms
similar to those in Exhibit B. In 1914 the
Patni lot Kooly was sold under the
Regulation, and purchased by Smt Kanchan
Barani Debi. She then sued as such
purchaser to recover possession of the
Choukidari Chakran lands. The defendants
who represented the grantees under the
Patni settlement of 1899 resisted the suit
on the ground that the sale of Patni Kooly
did not operate to vest in the purchaser
the title in the Choukidari Chakran lands,
as they formed a distinct Patni. Dealing
with this contention, B.B. Ghose, J. who
delivered the judgment of the Court,
observed:
“It is certainly open to the only
two parties concerned to alter the
terms of the original patni if they
chose to do so; and what we have to
see is whether that was done. In
order to do that, we have to examine
the terms of the pattah by which the
Choukidari Chakran lands were granted
to Syamlal Chatterjee.”
The learned Judge then refers to the two
clauses corresponding to the last two
clauses in Exhibit B, and comes to the
conclusion that their effect was merely to,
restore the position as it was when the
original Patni was created, and that, in
consequence, the purchaser was entitled to
the Patni as it was created in 1820, and
that the plaintiff was entitled to the
possession of the Choukidari Chakran lands
as being part of the Patni. Now, it is to
be observed that in deciding that the
Choukidari Chakran lands granted in 1899
27
became merged is lot Kooly, as it was in
1820, the learned Judge did not consider
the effect of the clause providing for sale
of those lands as a distinct entity under
the provisions of the Regulation when there
was default in the payment of rent payable
thereon under the deed, and that, in our
opinion, deprives the decision of much of
its value. In the result, we are unable to
hold that the two clauses on which the
learned Judges base their conclusion are
really inconsistent with the earlier
clauses which support the view that the
grant under Exhibit B is of a distinct
Patni. Nor do we agree with them that the
earlier clause providing for the sale of
the Chaukidari Chakran lands in default of
the payment of jama, should be construed so
as not to override the later clauses. If,
in fact, there is a conflict between the
earlier clause and the later clauses and it
is not possible to give effect to all of
them, then the rule of construction is well
established that it is the earlier clause
that must override the later clauses and
not vice versa. In Forbes v. Git, (19220
 1 AC 256, Lord Wrenbury stated the rule in
the following terms:
“If in a deed an earlier clause is
followed by a later clause which
destroys altogether the obligation
created by the earlier clause, the
later clause is to be rejected as
repugnant and the earlier clause
prevails. In this case the two
clauses cannot be reconciled and the
earlier provision in the deed
prevails over the later.”
We accordingly hold that Exhibit B created
a new Patni and that the sale of the lands
comprised therein is not bad as of a
portion of a Patni.”
28
20. There cannot be any dispute to principles of
construction of document as laid down by this Court
as noticed above. But we have to look into the
different clauses to find out the real intention of
the granter. We need to notice that present is a
case of Government grant where Government has granted
rights by Sale Deed to the writ petitioner. Section
3 of the Government Grants Act, 1895 provides for
Government grants to take effect according to their
tenor. Section 3 is as follows:-
3. Government grants to take effect
according to their tenor.- All provisions,
restrictions, conditions and limitations
over contained in any such grant or
transfer as aforesaid shall be valid and
the effect according to their tenor, any
rule of law, statute or enactment of
the Legislature to the contrary
notwithstanding.
21. This Court in S.N. Ranade Vs. Union of India and
Another, AIR 1964 SC 24 while considering the case of
Inam laid down following:-
“……………………when the said Government made a
grant to the appellant’s predecessors, the
principle enunciated by Section 8 of the
Transfer of property Act should be applied
29
and the grant should be construed to
include all rights, title and interest of
the grantor, unless there is a contrary
provision either expressly made, or implied
by necessary implications.”
22. Normally, the grant should be construed to
include all rights, title and interest of the
grantor, unless there is a contrary provision either
expressly made, or implied by necessary implications,
is the principle, which has been laid down by this
Court in above case. Paragraph No.3 contains the
intention of the granter to transfer the rights to
the writ petitioner in terms of the agreement dated
29.09.1988. Clause 3 limits and explain the rights,
which were given in Clause Nos. 1 and 2 of the Sale
Deed, but it cannot be said that Clause 3 is totally
contradictory to Clauses 1 and 2. The three clauses
have to be harmoniously construed to give effect to
the intention of the granter. Furthermore, as we
have noticed that auction notice provided for auction
of leasehold rights, which is an important factor,
which cannot be brushed aside while interpreting the
Sale Deed.
30
23. With reference to Clause 3 in the Sale Deed a
statutory provision also needs to be noticed. Section
269UE of the Income Tax Act, 1961 deals with vesting
of property in Central Government. Section 269UE has
been amended by Finance Act, 1993 w.e.f. 17.11.1992.
Amended Section 269UE sub-section (1) is as follows:
“269UE. Vesting of property in Central
Government.—(1) Where an order under subsection (1) of section 269UD is made by the
appropriate authority in respect of an
immovable property referred to in subclause (i) of clause (d) of section 269UA,
such property shall, on the date of such
order, vest in the Central Government in
terms of the agreement for transfer
referred to in sub-section (1) of section
269UC:
 Provided that where the appropriate
authority, after giving an opportunity of
being heard to the transferor, the
transferee or other persons interested in
the said property, under sub-section (1A)
of section 269UD, is of the opinion that
any encumbrance on the property or
leasehold interest specified in the
aforesaid agreement for transfer is so
specified with a view to defeat the
provisions of this Chapter, it may, by
order, declare such encumbrance or
leasehold interest to be void and thereupon
the aforesaid property shall vest in the
Central Government free from such
encumbrance or leasehold interest.
(2) *** *** ***
“
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24. In sub-section (1) of Section 269UE in place of
words “free from all encumbrances” the words “in
terms of the agreement for transfer referred to in
sub-section (1) of Section 269UC” have been inserted.
When the Sale Deed was executed in favour of the
auction-purchaser above amendment in Section 269UE
sub-section (1) had already been inserted. The
vesting of property in Central Government when is in
terms of agreement for transfer referred to in subsection (1) of Section 269UE at the time of execution
of Sale Deed, the statutory mandate has been
reflected in Clause 3. We, thus, neither can ignore
Clause 3 of the Sale Deed nor can hold that said
Clause has to give way to Clauses 1 and 2 of Sale
Deed. While finding out the tenor of grant as
reflected in Sale Deed, the provisions of sub-section
(1) of Section 269UE as amended by Finance Act has
also to be taken note of.
25. We, thus, find that on true construction of Sale
Deed, it is clear that all rights, titles and
interests were not conveyed to the petitioner in the
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leasehold residential plot, when we read Clauses 1, 2
and 3 together.
26. Learned counsel for the writ petitioner relying
on provisions of Section 111 of the Transfer of
Property Act, 1882 contends that leasehold rights
have been merged in the lessor since when lessor’s
interest coalesces with lessee’s interest, the
principle of merger comes into play. He has placed
reliance on judgment of this Court in T. Lakshmipathi
and Others Vs. P. Nithyananda Reddy and Others,
(2003) 5 SCC 150 and Pramod Kumar Jaiswal and Others
Vs. Bibi Husn Bano and Others, (2005) 5 SCC 492.
This Court in T. Lakshmipathi (supra) had examined
the doctrine of merger as contained in Section
111(d). In Paragraph Nos. 14 to 17, following was
laid down:-
“14. The common-law doctrine of merger is
statutorily embodied in the Transfer of
Property Act, 1882. Section 111(d)
provides:
“111. Determination of lease.—A
lease of immovable property,
determines—
* * *
33
(d) in case the interests of the
lessee and the lessor in the whole of
the property become vested at the
same time in one person in the same
right;
* * *”
A bare reading of the doctrine of merger,
as statutorily recognized in India,
contemplates (i) coalescence of the
interest of the lessee and the interest of
the lessor, (ii) in the whole of the
property, (iii) at the same time, (iv) in
one person, and (v) in the same right.
There must be a complete union of the whole
interests of the lessor and the lessee so
as to enable the lesser interest of the
lessee sinking into the larger interest of
the lessor in the reversion.
15. In Badri Narain Jha v. Rameshwar Dayal
Singh, AIR 1951 SC 186, it was held by this
Court that if the lessor purchases the
lessee’s interest, the lease no doubt is
extinguished as the same man cannot at the
same time be both a landlord and a tenant,
but there is no extinction of the lease if
one of the several lessees purchased only a
part of the lessor’s interest. In such a
case the leasehold and the reversion cannot
be said to coincide.
16. In Sk. Faqir Bakhsh v. Murli Dhar, AIR
1931 PC 63, the plaintiff was holding on
lease a portion of the entire property.
Subsequently, the plaintiff and the
defendant became pro indiviso joint
proprietors of the property by purchasing
shares from the earlier owners. The lease
was subsisting when the shares were bought
by the parties. In a suit for accounts
filed by the plaintiff it was held that the
plaintiff’s rights under lease of a part do
not merge in his rights as joint proprietor
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of the whole of the property as between the
parties the plaintiff held a valid and
subsisting lease.
17. A Division Bench of the Patna High
Court in Parmeshwar Singh v. Sureba Kuer,
AIR 1925 Pat 530, held that Section 111(d)
applies only to a case where the interests
of the lessee and of the lessor in the
whole of the property become vested at the
same time in one person in the same right.
Where a co-proprietor in the property
purchased for himself the interest of the
lessees of the whole property, there could
be no merger. On purchase of a partial
interest in tenancy rights by the owner,
the onus of proving that the distinction
between the interests continued to be kept
alive subsequently also cannot be placed on
the party alleging that the distinction was
so kept alive. To the same effect is the
view of the law taken in Lala Nathuni
Prasad v. Syed Anwar Karim, AIR 1919 Pat
390. Merger is largely a question of
intention, dependent on circumstances, and
the courts will presume against it when it
operates to the disadvantage of a party, as
was held by this Court in Nalakath
Sainuddin v. Koorikadan Sulaiman, (2002) 6
SCC 1 (SCC para 20).”
27. To the same effect is judgment of this Court in
Pramod Kumar Jaiswal (supra). There cannot be any
dispute to the proposition laid down by this Court in
reference to Section 111(d). We, however, find that
in the present case, we need not rely on doctrine of
merger as contained in Section 111(d). Present being
35
a case of a Government grant by virtue of the Section
2 of the Government Grants Act, 1895, nothing in the
Transfer of Property Act, 1882, shall apply or be
deemed ever to have applied to any grant or other
transfer. The principles contained in the Transfer
of Property Act have been applied while construing
the Government grants as has been noticed above. But
herein issue being Government grant, the principle of
merger may not be of much relevance. More so, we
having construed the Sale Deed as not having conveyed
all rights and interests in the leasehold property,
the principle of merger does not in any manner
advance the claim of the writ petitioner.
28. Learned counsel for the writ petitioner has also
referred to and relied on judgment of the Division
Bench of Delhi High Court in M/s. Bansal Contractors
(India) Ltd. & Anr. Vs. Union of India and Others, 76
(1998) DLT 805. In the above case, sale of property
was made in public auction after exercising the power
under Section 269UD. From the judgment of Delhi High
Court, it is not clear that as to whether any clause
36
similar to Clause 3 as contained in the Sale Deed in
question, was there. In absence of any such clause,
interpretation put to the Sale Deed by the Delhi High
Court cannot be faulted. It is further relevant to
notice that details of the auction notice are not
noticed in the judgment to find out what was the
nature of the property, which was sought to be put
for auction. We, thus, are of the view that judgment
of Delhi High Court was on its own facts and cannot
be relied on by the writ petitioner in the facts of
the present case. We, thus, do not find any error in
the judgment of the Division Bench setting aside the
direction made by the learned Single Judge to refund
the amount of conversion. The writ petitioner has
made an alternative prayer in the writ petition
seeking a writ of mandamus directing the respondents
to allow/order the conversion of the lease hold
rights into freehold rights in respect of the
aforesaid plot of land without payment of any amount
of alleged unearned increase and or interest due
thereon.
37
29. We having held that writ petitioner is not
entitled for refund of conversion charges, we direct
the DDA to process the writ petitioner’s application
for conversion of the leasehold rights into freehold
rights. The Civil Appeal No.1534 of 2019 filed by
M/s. Karamdeep Finance and Investment (I) Pvt. Ltd.
is disposed of upholding the order of Division Bench,
however, with direction to DDA to process the
application for conversion in accordance with law.
The Civil Appeal No. 1533 of 2019 is dismissed. The
parties shall bear their own costs.

......................J.
 ( ASHOK BHUSHAN )
......................J.
 ( K.M. JOSEPH )
New Delhi,
February 12, 2019.
38