unauthorized occupants have no right to seek an entry in the Record of Rights = if a party has admitted that he is not in possession as a tenant but as an unauthorized occupant of the disputed property, the property cannot be deemed to be vested with the State Government under the 1961 Act. Consequently, the revenue entry should continue to remain in the name of the temple/owner of the property. Such alleged unauthorized occupants have no right to seek an entry in the Record of Rights under Sections 128 and 129 of the 1964 Act, and any entry which is unlawfully made in their favour is liable to be deleted. = The Division Bench wrongly observed that there is no documentary evidence that the suit property is in possession of the temple, whereas, as mentioned supra, the records of proceedings show that the respondents themselves have admitted they have no right over the suit property and it belongs to the temple. Hence on the basis of the materials on the record, we conclude that the entry in the respondents’ predecessors’ names in the Record of Rights was illegal and the revenue records in respect ofthe suit property were correctly modified in the appellant’s name by the orders of the revenue authorities dated 21.05.2003, 30.07.2005 and 23.03.2006.

NON­REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 2926 OF 2009
Sri Ganapathi Dev Temple Trust  …..Appellant
Versus
Balakrishna Bhat Since Deceased
By His Lrs. And Others …Respondents
J U D G M E N T
MOHAN M. SHANTANAGOUDAR, J.
The judgment dated 14.11.2007 passed by the Division Bench
of the High Court of Karnataka at Bangalore in Writ Appeal No. 984
of 2007 is called into question in this appeal.
By the impugned judgment, the Division Bench set aside the
order dated 21.05.2003 of the Tehsildar, Ankola Taluk and the
consequential mutation entry No. 7948 dated 28.05.2003 in respect
of the suit property; the order dated 30.07.2005 passed by the
1
Assistant Commissioner, Kumta and the order dated 23.03.2006
passed by the Deputy Commissioner, Uttara  Kannada, Karward
upholding the aforesaid mutation entry, as well as the order dated
22.03.2007 passed by the Single Judge in Writ Petition No. 12482
of 2006 dismissing the respondents’ writ petition for quashing of
the mutation entry.
2.  The brief facts leading to this appeal are as under:
The Respondent Nos. 1(a) to (e) in the present appeal claim
that one late Baba Bommayya Bhat was the archak of the appellant
Ganapathi   Dev   temple   and   he   was   in   actual   possession   and
enjoyment of agricultural land bearing Survey No. 68/2001 to the
extent of 4 guntas (mentioned in some of the records as 3 guntas)
(hereinafter ‘suit property’) situated in the village of Avarsa, which
he had been cultivating since 1969; that after the death of the said
Baba Bommayya Bhat, his son, the late Balakrishna Bhat (husband
of Respondent No. 1(a) and father of the Respondents No. 1(b) to
1(e)   herein)   continued   in   possession   of   the   suit   property   and
consequently the name of Balakrishna Bhat was entered into the
revenue records. 
2
Further that the deceased Balakrishna Bhat, after obtaining
necessary permission from the Panchayat, constructed a house in
the suit property in 1994 and obtained an electricity connection for
the said house; and that after his demise, Respondent Nos. 1(a) to
(e) are residing in the same house. Respondent Nos. 1(a) to (e)
therefore claimed to be the deemed tenants of the suit property
under the Karnataka Land Reforms Act, 1961 (‘1961 Act’). 
3. It is pertinent at this juncture to note the scheme for land
reforms as provided under the 1961 Act. Section 2(34) of the 1961
Act   defines   ‘tenant’   as   meaning   an   agriculturist   who   cultivates
personally the land he holds on lease from a landlord and includes
a person who is deemed to be a tenant under Section 4 of the Act.
Section 4 defines a deemed tenant as follows:
“4.   Persons   to   be   deemed   tenants.—A   person   lawfully
cultivating   any   land   belonging   to   another   person   shall   be
deemed to be a tenant if such land is not cultivated personally
by the owner and if such person is not,— (a) a member of the
owner’s family, or (b) a servant or a hired labourer on wages
payable in cash or kind but not in crop share cultivating the
land   under   the   personal   supervision   of   the   owner   or   any
member   of   the   owner’s   family,   or   (c)   a   mortgagee   in
possession.”
3
Under Section 44 of the 1961 Act, as substituted by Amending
Act No. 1 of 1974, all lands held by or in possession of tenants
immediately prior the commencement of the Amendment Act shall
with effect from 01.03.1974 (‘date of vesting’) vest with the State
Government. Section 45(1) of the 1961 Act provides for the right of
tenants to be registered as occupants of the land vested with the
Government as follows:
“45.   Tenants   to   be   registered   as   occupants   of   land   on
certain   conditions.—(1)   Subject   to   the   provisions   of   the
succeeding sections of this Chapter, every person who was a
permanent tenant, protected tenant or other tenant or where a
tenant has lawfully sublet, such sub­tenant shall, with effect
on and from the date of vesting, be entitled to be registered as
an   occupant   in   respect   of   the   lands   of   which   he   was   a
permanent tenant, protected tenant or other tenant or subtenant   before   the   date   of   vesting   and   which   he   has   been
cultivating personally.”
Section 48A of the 1961 Act enables any person entitled to be
registered as an occupant of land under Section 45 to make an
application   to   the   Land   Tribunal   praying   for   such   registration.
Respondent No 1(b), Vitthaldas Bhat, filed a Form­7 application
under Section 48A in 1979 for grant of occupancy rights in respect
of the suit property in his favour, Form­7 being the format for such
4
application as prescribed under Rule 19 of the Karnataka Land
Reform Rules, 1974 (‘1974 Rules’). 
However, during course of enquiry before the Land Tribunal,
Respondent No 1(b) himself deposed that he was not cultivating the
property and the Form 7 application was made by him on a wrong
notion. He stated that the suit property is to remain in the name of
the appellant temple and pleaded for dismissal of his application.
Hence the Land Tribunal by order dated 28.01.1981 rejected the
said Form 7 application filed under Section 48A of the 1961 Act.
Thus,   it   is   clear   that   as   of   28.01.1981,   and   prior   thereto,
Respondent Nos. 1(a) to (e) were not cultivators of the property, and
therefore could not be deemed tenants under Section 4 of the 1961
Act.
By Amending Act No. 23 of 1998, Section 77A was inserted in
the 1961 Act which gave one more chance to a person who failed to
apply for registration of their occupancy rights under Section 48A
within   the   period   specified   therein,   to   apply   to   the   Deputy
Commissioner for such registration. Rule 26C of the 1974 Rules
prescribes   that   the   format   of   the   application   to   the   Deputy
5
Commissioner would be per Form 7A of the Rules.
In view of rejection of his son’s Form 7 application under
Section 48A, the deceased Balakrishna Bhat was not entitled to
apply   for   grant   of   occupancy   rights   under   Section   77A   of   the
amended 1961 Act. He nonetheless filed a Form 7A application
under Section 77A. The Assistant Commissioner, Kumta by order
dated 15.03.2000 rightly rejected the application of the deceased
Balakrishna Bhat on the ground that it was not possible to confer
occupancy rights or grant in view of the earlier Land Tribunal order
dated 28.01.1981.
4.  Prior   to   the   aforementioned   proceedings,   the   Government’s
name was entered into the revenue records of the suit property
based on the presumption that the deceased Balakrishna Bhat was
the tenant of the suit property, and hence the property was vested
with the State Government under Section 44 of the 1961 Act. In his
order dated 15.03.2000, the Assistant Commissioner specifically
observed that the suit property does not come under the purview of
the 1961 Act and directed for the removal of the Government’s
name   in   the   revenue   entry   of   the   suit   property.   This   was   not
6
challenged by the respondents herein. However, this direction was
inexplicably   not   effected.   Hence,   the   appellant   herein   filed   an
application before the Tehsildar to delete the name of the State
Government and Balakrishna Bhat in the revenue records of the
suit property.
This   application   was   allowed   after   enquiry   by   order   dated
21.05.2003, and the appellant’s name was entered in the Record of
Rights vide mutation entry No. 7948. The Tehsildar’s order dated
21.05.2003 entering the appellant’s name, based on the previous
orders of the competent authorities, was confirmed by the Assistant
Commissioner   and   the   Deputy   Commissioner   by   orders   dated
30.07.2005 and 23.03.2006 respectively. Respondent Nos. 1(a) to
(e)   challenged   all   the   aforementioned   orders   dated   21.05.2003,
30.07.2005 and 23.03.2006 respectively before the learned Single
Judge in Writ Petition No. 12482 of 2006, which also came to be
dismissed.
However curiously, the Division Bench of the High Court, in
the   impugned   judgment,   without   appreciating   the   material   on
record   in   its   proper   perspective,   granted   relief   in   favour   of   the
respondents on the ground that they had constructed a house on
7
the   suit   property   and   had   been   in   peaceful   possession   and
enjoyment of the same and that the entry made in their favour in
the Record of Rights shall be presumed to be true under Section
133 of the Karnataka Land Revenue Act, 1964 (‘1964 Act’). Hence
this appeal.
5.  Heard learned counsel Shri S.N. Bhat for the appellant and
learned   counsel   Shri   R.S.   Hegde   for   the   respondent.   Both   the
learned advocates have taken us through the material on record
and the relevant provisions of law and put forth their arguments in
support of their respective cases effectively.
6.  The primary issue which arises for adjudication in this matter
is as regards the correctness of the revenue entries in the name of
the respondents. As mentioned supra, the respondents had claimed
to be in possession of the suit property as tenants since the 1970’s.
The Land Tribunal as well as the Assistant Commissioner after due
enquiry   have   rejected   their   claims   on   two   separate   occasions.
However,   the   respondents’   contention   is   that   since   they   have
constructed a house on the suit property in the year 1994 and are
residing therein, their names need to be entered in the revenue
record. Such contention cannot be accepted in as much as they
8
cannot, after failing in all their attempts to claim possession as a
tenant, now claim to be in possession by way of construction of
house and not as agriculturists. We are at a loss to understand as
to on the basis and on what right the respondents can claim to be
in   possession   of   the   suit   property   and   as   to   how   they   could
construct a house on a property on which they do not have any
semblance of right. 
7.  The suit property admittedly belongs to the appellant temple.
It   is   also   not   disputed   that   the   Respondent   No.   1(b)   and   his
predecessors were the archaks of the temple. Needless to say, it is
the bounden duty of the archak to protect the temple property, and
they cannot usurp such property for their own gains. It is relevant
in this regard to refer to the judgment of this Court in Bishwanath
and Another v. Sri Thakur Radha Ballabhji and Others, (1967)
2 SCR 618,:
“9. Three legal concepts are well settled: (1) An idol of a Hindu
temple   is   a   juridical   person;   (2)   when   there   is   a   Shebait,
ordinarily no person other than the Shebait can represent the
idol;   and   (3)   worshippers   of   an   idol   are   its   beneficiaries,
though only in a spiritual sense…
10. The question is can such a person represent the idol when
the Shebait acts adversely to its interest and fails to take
9
action to safeguard its interest. On principle we do not see any
justification for denying such a right to the worshipper. An idol
is in the position of a minor; when the person representing it
leaves it in the lurch, a person interested in the   worship   of
the idol can certainly be clothed with an ad hoc power of
representation to protect its interest…
11…B. K. Mukherjea in his book ‘The Hindu Law of Religious
and Charitable Trust’ 2nd Edn., summarizes the legal position
by way of the following propositions, among others, at p. 249.
‘(1)   An   idol   is   a   juristic   person   in   whom   the   title   to   the
properties of the endowment vests. But it is only in an ideal
sense that the idol is the owner. It has to act through human
agency, and that agent is the Shebait, who is, in law, the
person   entitled   to   take   proceedings   on   its   behalf.   The
personality of the idol might therefore be said, to be merged in
that of the Shebait.
(2) Where, however, the Shebait refuses to act for the idol or
where the suit is to challenge the act of the Shebait himself as
prejudicial to the interests of the idol then there must be some
other agency which must have the right to act for the idol. The
law accordingly recognises a right in persons interested in the
endowment to take proceedings on behalf of the idol.’
This view is justified by reason as well as by decisions.”
(emphasis supplied)
Therefore, it is well­settled that the deity in a Hindu temple is
in deemed to be a minor, and the Shebait, archaka, etc. or the
person functioning as manager/trustee of such temple acts as the
guardian of the idol and conducts all transactions on its behalf.
However, the Shebait or archaka is obligated to act solely for the
10
idol’s benefit. In Sri Thakur Radha Ballabhji  (supra), this Court
affirmed the lower courts’ finding that a sale made by the manager
of the deity to a third party, which was not for the necessity of the
benefit   of   the   idol,   would   not   be   binding   on   the   deity,   and
worshippers   or   other   parties   who   had   been   assisting   in   the
management of the temple could apply to have such a sale set
aside.
In the present case, since the Respondent No. 1(a) to 1(e) and
his predecessors were holding the position of archaks and were
involved in the management of the temple, it would have been easy
for them to get their names entered in the revenue records, ignoring
the interest of the temple. Even otherwise, their attempt to claim
occupancy rights over the suit property have failed. As mentioned
supra, according to their own admission before the Land Tribunal,
they were not in possession of the suit property. 
The principle laid down by the Court in Sri Thakur Radha
Ballabhji  (supra) would be applicable to the present scenario as
well. Hence the appellant temple has the right, through its present
11
managing trustee, to undertake proceedings for the benefit of the
idol for having such wrongful entries set aside, and such wrongful
entries would not be binding on the temple.
8.  We find that the reasons assigned by the Division Bench in the
impugned judgment for granting relief in favour of the respondents,
while setting aside the concurrent findings of the three revenue
authorities as well as the order of the learned Single Judge, are
unacceptable.
9.  At this juncture, we find it useful to discuss the provisions of
the 1964 Act relevant for adjudicating upon this case. Section 127
of the 1964 Act provides for the preparation of Record of Rights as
follows:
“127.   Record   of   Rights.—(1)   A   record   of   rights   shall   be
prepared in the prescribed manner in respect of every village
and such record shall include the following particulars:—
(a) the names of persons who are holders, occupants, owners,
mortgagees, landlords or tenants of the land or assignees of
the rent or revenue thereof;
(b) the nature and extent of the respective interest of such
persons   and   the   conditions   or   liabilities   (if   any)   attaching
thereto;
(c) the rent or revenue (if any) payable by or to any of such
persons; and
(d) such other particulars as may be prescribed.”
12
Section 128(1) of the 1964 Act requires that any acquisition of
rights must be reported to the concerned officer within a period of
three months from the date of acquisition:
“128. Acquisitions of rights to be reported.—(1) Any person
acquiring by succession, survivorship, inheritance, partition,
purchase,   mortgage,   gift,   lease   or   otherwise,   any   right   as
holder, occupant, owner, mortgagee, landlord or tenant of the
land or assignee of the rent or revenue thereof,  shall report
orally   or   in   writing   his   acquisition   of   such   right   to   the
prescribed officer of the village within three months from the
date of such acquisition, and the said officer shall at once give
a written acknowledgment of the receipt of the report to the
person making it…
…Provided further that any person acquiring a right by virtue
of a registered document shall be exempted from the obligation
to report to the prescribed officer.”
(emphasis supplied)
Section 129 provides that the prescribed officer shall enter in
the Register of Mutations every such report made to him under
Section 128 in respect of acquisition of right in land. Section 129(6)
provides that such entries shall be tested and if found correct, shall
be   certified   by   the   prescribed   officer;   whereas   Section   129(7)
provides for the transfer of entries from the Register of Mutations to
the Record of Rights after due certification. It is therefore clear that
under the scheme of the 1964 Act, there has to be an initial report
13
made to the prescribed officer certifying the occupant’s right in the
land, and the entry in the Record of Rights has to be made and
certified on the basis of such report.
10.  The Record of Rights for the year 1973­1974 shows that the
respondents’ predecessor Baba Bommayya Bhat was cultivating the
suit property and that the deceased Balakrishna Bhat’s name was
entered in the subsequent revenue entries for the suit property.
However, the respondents have not produced on record any report
made by  them as required  under Section 128 of  the  1964 Act
proving that they had acquired any right or title in respect of the
suit property. Nor have they produced any registered document
showing that they have acquired any such right, in which case they
would have been exempt from the requirement under Section 128.
Further,   the   respondents   herein   have   not   at   any   point,
challenged the Land Tribunal’s order dated 28.01.1981 and the
Assistant   Commissioner’s   order   dated   15.03.2000   which
concurrently found that by the respondents’ own admission, the
suit property belongs to the temple and is not covered by the 1961
Act and the respondents are not eligible for any occupancy rights in
the said property. Hence it is not open to the respondents to claim
14
that the land was deemed to have vested in the State Government
under the 1961 Act, and consequently they were not required to
have   reported   acquisition   of   rights   in   the   suit   property   under
Section 128. 
Upon perusal of the relevant provisions of the 1961 Act and
the 1964 Act, we are of the considered opinion that if a party has
admitted   that   he   is   not   in   possession   as   a   tenant   but   as   an
unauthorized   occupant   of   the   disputed   property,   the   property
cannot be deemed to be vested with the State Government under
the 1961 Act. Consequently, the revenue entry should continue to
remain in the name of the temple/owner of the property. Such
alleged unauthorized occupants have no right to seek an entry in
the Record of Rights under Sections 128 and 129 of the 1964 Act,
and any entry which is unlawfully made in their favour is liable to
be deleted. 
The respondents had admitted in 1981 that they did not have
any   tenancy   rights,   and,   as   mentioned   supra,   the   Assistant
Commissioner’s   order   had   also   specifically   found   that   the   suit
property was not under the purview of the 1961 Act. Hence, there
was no basis for the land to be shown as vested in the name of the
15
State Government under Section 44 of the 1961 Act. Therefore, the
revenue entry in the Record of Rights in respect of the suit property
wrongfully made in the name of the deceased Balakrishna Bhat,
and consequently the Government, without any basis was required
to be deleted.
Section 133 of the 1964 Act provides that an entry in the
Record of Rights shall be presumed to be true until the contrary is
proved, or a new entry is lawfully substituted therefor. An entry
cannot be made in the Record of Rights without the valid mutation
entry as provided for in Sections 128 and 129 of the 1964 Act. No
pleading is forthcoming that a mutation entry was validly made at
any point of time in favour of the respondents. In view of the above
discussion, since it has been proved that there was no basis for
making the revenue entry in respect of the suit property, and a new
entry has lawfully been made in the appellant’s name, we see no
reason to give the respondents the benefit of Section 133 as was
done by the Division Bench in the impugned judgment.
Admittedly, the appellant ought to have been more diligent in
getting the revenue entry corrected. However, they had explained in
their submissions before the Learned Single Judge in Writ Petition
16
No. 12482 of 2006 that they were under the genuine impression
that since the revenue authorities had found that that the writ
petitioners (the respondents herein) are not entitled to be registered
as tenants of the land, the competent authorities would suo motu
carry   out   the   necessary   corrections   in   the   Record   of   Rights.
However   the   authorities   regretfully   failed   to   do   in   spite   of   the
direction to this effect given by the Assistant Commissioner in his
order   dated   15.3.2000,   which   was   not   challenged   by   the
respondents herein. The Division Bench has overlooked this aspect
of the matter while reaching its conclusions.
Apart   from   this,   the   Division   Bench   has   made   certain
observations which are against the available facts borne out from
the record. The Division Bench wrongly observed that there is no
documentary evidence that the suit property is in possession of the
temple, whereas, as mentioned supra, the records of proceedings
show that the respondents themselves have admitted they have no
right over the suit property and it belongs to the temple. 
Hence on the basis of the materials on the record, we conclude
that   the   entry   in   the   respondents’   predecessors’   names   in   the
Record of Rights was illegal and the revenue records in respect of
17
the suit property were correctly modified in the appellant’s name by
the orders of the revenue authorities dated 21.05.2003, 30.07.2005
and 23.03.2006.  
11.   Hence the impugned judgment in Writ Appeal No. 984 of 2007
is set aside, and the appeal is allowed.
..........................................J.
      (N.V. Ramana)
..........................................J.
      (Mohan M. Shantanagoudar)
New Delhi; ..........................................J.
September 17, 2019. (Ajay Rastogi)
18

Seeking release of the land from the process of acquisition is not considered favourably. = writ petition filed before the High Court was in a certiorari proceeding, it was necessary for the High Court to secure the records and consider as to whether the possession had been validly taken and handed over to HUDA as claimed. Further whether in the layout plan as referred in the order dated 11.10.2014 impugned in the writ petition, the very item of land belonging to the appellants was reserved for the institutional plot, green belt and parking areas as claimed and as to whether the surrounding area had been developed by HUDA by forming the residential plots was also to be considered, though not in the nature of an appeal, but to satisfy itself on perusal of relevant records. The further contention on behalf of the appellants is that in respect of the very same layout this Court in the case of Patasi Devi Vs. State of Haryana & Ors. (2012) 9 SCC 503 has directed that the land involved therein be released. It is no doubt seen that in the said case the appellant who was the owner of the land which was acquired had constructed a house and in that light there being no document to indicate that the possession was taken over by putting a lock, it was held that the possession was not taken. Though that be the position it is also indicated that the case of the appellant therein was required to be considered in the same manner as was done in the case of M/s Sharad Farm and Holdings (P) Ltd. Apart from the said decision which relates to the very same layout, the learned counsel for the appellants has also relied on the decision in the case of Hari Ram & Anr. vs. State of Haryana & Ors. (2010) 3 SCC 621 wherein with reference to the Policy dated 26.10.2007 it is indicated that the similar land owners should receive a similar consideration when representation is made for deletion.

NON REPORTABLE
             
   IN THE SUPREME COURT OF INDIA
   CIVIL APPELLATE JURISDICTION
   CIVIL APPEAL NO.     7317   OF 2019
   (Arising out of SLP (Civil) No.3213 of 2016)
Krishan Chander & Anr.                .…Appellant(s)
Versus
State of Haryana & Ors.           ….  Respondent(s)
J U D G M E N T
A.S. Bopanna,J.
       
       Leave granted.   
2.     The appellants are before this Court assailing the
order dated 21.10.2015 passed by the High Court for the
States of Punjab and Haryana in CWP No.22656/2015.
The said writ Petition was disposed of along with the writ
petition   bearing   CWP.No.22652   and   22653   of   2015
through a common order.   Through the said order the
case sought to be made out by the appellants seeking

Page 1 of 15
release of the land from the process of acquisition is not
considered favourably.  The writ petitions are accordingly
dismissed by the High Court.
3. The brief facts are that the lands bearing Khasra
No.19/2, 9 measuring 16 kanal situated in Village Para,
District Rohtak, to which the appellants’ claim that their
father was the owner, among other lands of several other
land owners was acquired for development of Sector 36,
Rohtak   by   issuing   the   Notification   dated   15.12.2006
issued under Section 4 of the Land Acquisition Act, 1894
(‘L.A. Act’ for short).  The final declaration under Section
6 was issued on 14.12.2007.   The appellants contend
that the land has not been utilised for the purpose for
which it was acquired and in respect of several other
lands acquired for the same purpose, it has been deleted
from the process of acquisition and as such the lands
belonging   to   the   appellants   also   be   deleted.     In   that
regard   the   appellants,   at   the   first   instance,   had
approached   the   High   Court   through   CWP.No.5836   of
2014.  The said writ petition was disposed of through the

Page 2 of 15
order   dated   27.03.2014   whereby   the   High   Court   on
taking note of the contentions had issued direction to the
respondents to verify the claim of the appellants and on
objective   consideration   of   the   whole   matter   if   the
authorities are of the view that there is no likelihood of
utilisation of the appellants’ land for any public purpose,
consider the desirability  of releasing the same subject to
the condition that the compensation if any received be
refunded.     Pursuant   thereto   the   representation   dated
20.02.2014   which   had   already   been   made   by   the
appellants   was   taken   note   and   an   order   dated
10.11.2014   was   passed   by   the   Secretary­cum­Director
General,   Urban   Estates   Department   Haryana,   rejected
the claim of the appellants.  Against such rejection, the
appellants   were   before   the   High  Court   in  the   present
round of litigation assailing the order dated 10.11.2014
which has led to the instant appeal.   The respondents
through the counter affidavit filed herein on behalf of the
respondent No.2 have opposed the instant appeal.

Page 3 of 15
4. Heard Shri J.B. Mudgil, learned counsel for the
appellants,   Shri   B.K.   Satija   learned   counsel   for   the
respondents and perused the appeal papers.
5. As noticed the claim put forth on behalf of the
appellants is that the land bearing Khewat No.599/553
Khatoni   No.671,   Killa   No.19/2   (8­0)   and   9(8­0)   total
measuring 16­0 situated within the Revenue Estate of
Mouza Para, Hadbast No.67, Tehsil and District Rohtak
though   sought   to   be   acquired   under   the   Notification
dated 15.12.2006 and 14.12.2007 for forming the Sector
36 layout, the said land has not been utilised.   In that
regard seeking release of unutilised and unused land the
appellants   had   made   the   representation   dated
20.02.2014.     Since   the   request   made   through   the
representation   is   rejected   through   the   order   dated
10.11.2014   the   writ   petition   bearing   C.W.P.
No.22656/2015 was filed which is dismissed.  A perusal
of the order dated 21.10.2015 passed by the High Court
would disclose that the High Court, having taken note
that the impugned order discloses that while considering

Page 4 of 15
the representation the State Government has found that
the   land   was   vacant   at   the   time   of   publication   of
Notification under Section 4 of the Act and it is still lying
vacant,   the   release   in   view   of   the   Policy   dated
26.10.2007, modified on 24.01.2011 is not tenable since
the said policy pertains to release of land over which the
residential   buildings   have   been     constructed.     Taking
note   of   the   same   the   High   Court   has   dismissed   the
petition without any further consideration.
6. At the outset, it is necessary to take note that the
writ   petition   was   dismissed   at   the   threshold   without
directing notice to the respondents and considering the
grievance   of   the   appellants   in   the   backdrop   of   the
contention urged.  In a normal circumstance we do not
find that there would be any impediment to dispose of at
the threshold.   However, in the present facts we notice
that the order dated 10.11.2014 which was impugned
before the High Court was an order which was passed
pursuant to the direction issued in earlier order dated
27.03.2014   passed   by   the   High   Court   in   CWP

Page 5 of 15
No.5836/2014.  In the said writ petition the High Court
had taken note of the grievance that had been put forth
by the appellants that the respondents had acquired the
land much more than what was needed for the notified
public purpose and after utilisation of such land for the
said public purpose, a substantial part of the acquired
land is lying unutilised.  It was also taken note that the
appellants had averred that they are still in possession of
the land as is evident from the entries in the Revenue
record and the photographs.   Having taken note of the
case put forth, the Court had also observed that the High
Court has already taken a view in another matter that
the acquisition of land in excess to what is needed for a
bonafide   public   purpose   is   also   detrimental   to   public
interest as it would be an unwarranted burden on the
State Exchequer.   Having observed so, the High Court
had indicated that the question as to whether or not the
appellant’s unutilised land is still needed for a bonafide
public purpose has to be essentially determined by the
authorities only.  It is in that light a direction had been
issued for consideration of the representation.

Page 6 of 15
7. In that background a perusal of the order dated
10.11.2014 impugned in the present writ petition bearing
CWP.No.22656/2015 would disclose that the competent
authority has noted that as per the fresh site survey, the
land   of   the   appellants   is   lying   vacant.     It   is   further
observed that as per the layout plan of Sector 36 which is
approved,   the   appellants’   land   has   been   planned   for
institutional plot, green belt and parking area.   In that
circumstance,   it   is   stated   that   the   C.A.,   HUDA   has
recommended not to release any land in favour of the
appellants.  In that circumstance when presently the said
order had been assailed in the writ petition challenging
its   correctness,   that   too   when   such   order   had   been
passed pursuant to the direction issued earlier by the
High Court, a deeper examination was required by the
High   Court   after   calling   for   objections   from   the
respondents.
8. It is no doubt true that presently in the instant
appeal before this Court the respondents have filed their
objection statement and have sought to contend that the

Page 7 of 15
land is required for the purpose of the layout; that the
land   in   question   being   vacant   land   and   since   the
appellants had not filed the objections under Section 5­A
of the L.A. Act the consideration for deletion under the
Policy does not arise.  Relying on objection statement the
learned   counsel   for   the   respondents   has   vehemently
contended that the possession of the land has been taken
under ‘Rapat Roznamcha’ on 09.12.2009.   Reference to
the same is made indicating that out of the 88.24 acres of
which possession was taken the land bearing No.19/2 of
the appellants also forms a part.   To contend that the
possession being taken by drawing a Panchnama is the
approved mode of taking possession, the learned counsel
has relied upon on the decisions in the case of Sita Ram
Bhandar Society, New Delhi vs. Lieutenant Governor,
Government of NCT, Delhi & Ors. (2009) 10 SCC 501;
in   the   case   of  M.   Venkatesh   vs.   Commissioner,
Bangalore   Development   Authority  (2015)   17   SCC   1
and in the case of  Indore  Development  Authority  vs.
Shailendra (2018) 3 SCC 412.

Page 8 of 15
9. The   learned   counsel   for   the   respondents   has
further relied on the decision in the case of V. Chandra
Sekaran and Anr. vs. Administrative Officer  & Ors.
2012   (12)   SCC   133   to   contend   that   the   land   once
acquired cannot be restored even if not used.   At this
stage itself it is necessary to be noticed that the said
decision was in the circumstance where a subsequent
purchaser had approached the Court and further in the
instant case a policy is adopted by the respondents for
release of land and appellant is seeking consideration on
parity which is a matter for consideration one way or the
other.
10. The   learned   counsel   for   the   appellants,   on   the
other hand, contended that the Panchnama drawn for
taking possession was not at the spot and in that regard
has   relied   on   the   decision   in   the   case   of  Banda
Development Authority, Banda vs. Moti Lal Agarwal
and Ors. 2011 (5) SCC 394.  In that background though
the fact of taking possession would become relevant in a
circumstance to de­notify the land in terms of Section 48

Page 9 of 15
of the L.A. Act,   the other aspects of the matter would
also arise herein, in view of the nature of consideration
made by the High Court in the earlier round and in that
background   the   correctness   of   the   impugned   order
passed by the competent authority dated 10.11.2014 was
to be noted in the present round of litigation.  In so far as
the   contention   urged   by   the   learned   counsel   for   the
respondents   that   the   appellants   had   entered   into   a
collaboration   agreement   with   M/s   Sharad   Farm   and
Holdings     (P)     Ltd.   on   23.04.2007   after   issuance   of
Notification   under   Section   4   of   the   L.A.   Act   and   has
received a sum of Rs.28,20,000/­ from them, the same
would have arisen for consideration and denial of relief at
the   threshold  only  if  the   said  M/s  Sharad  Farm  and
Holding  (P) Ltd based on such collaboration agreement
had  approached  the  Court  seeking for  deletion of  the
land.  In the instant proceedings the appellants being the
owners of the notified land are seeking deletion and the
validity of such agreement would be an inter­se issue. 

Page 10 of 15
11. Though the respondents have further contended
that the Policy for deletion provide for consideration only
if objections under Section 5­A is filed and it is contended
that no such objection was filed by the appellants, the
representation dated 20.02.2014 (Annexure P.1) filed by
the appellants indicates that the appellants have stated
therein that the applicants have filed objections under
Section 5­A of the L.A. Act to the proposed acquisition.
Though at this stage we are not in a position to determine
the correctness of the contrary rival contentions that is
also one of the aspects which required consideration by
the High Court to come to a conclusion as to whether the
benefit of the policy is available.  Further the Notification
for acquisition was issued far back as on 15.12.2006.
The consideration pursuant  to  the  earlier order  dated
27.03.2014 passed in CWP No. 5836/2014 was made by
the competent authority on 10.11.2014.  Even as on that
day, admittedly the lands belonging to the appellants is
kept vacant though the competent authority states that
in the layout plan of Sector 36 the lands of the appellants
is kept for institutional plot, green belt and parking area.

Page 11 of 15
The appellants on the other hand by relying on the layout
plan  of  sector  36  produced  before this  Court  seek  to
contend   that   the   lands   surrounding   the   lands   of   the
appellants has been released.
12. In the backdrop of such contentions and keeping
in view that the writ petition filed before the High Court
was in a certiorari proceeding, it was necessary for the
High   Court   to   secure   the   records   and   consider   as   to
whether   the   possession   had   been   validly   taken   and
handed over to HUDA as claimed.  Further whether in the
layout plan as referred in the order dated 11.10.2014
impugned   in   the   writ   petition,   the   very   item   of   land
belonging   to   the   appellants   was   reserved   for   the
institutional   plot,   green   belt   and   parking   areas   as
claimed and as to whether the surrounding area had
been developed by HUDA by forming the residential plots
was also to be considered, though not in the nature of an
appeal, but to satisfy itself on perusal of relevant records.
The further contention on behalf of the appellants is that
in respect of the very same layout this Court in the case

Page 12 of 15
of  Patasi Devi Vs.  State  of  Haryana & Ors.  (2012) 9
SCC 503 has directed that the land involved therein be
released.   It is no doubt seen that in the said case the
appellant   who   was   the   owner   of   the   land   which   was
acquired had constructed a house and in that light there
being no document to indicate that the possession was
taken   over   by   putting   a   lock,   it   was   held   that   the
possession was not taken.  Though that be the position it
is also indicated that the case of the appellant therein
was required to be considered in the same manner as
was done in the case of M/s Sharad Farm and Holdings
(P) Ltd.  Apart from the said decision which relates to the
very same layout, the learned counsel for the appellants
has also relied on the decision in the case of Hari Ram
& Anr. vs. State of Haryana & Ors. (2010) 3 SCC 621
wherein with reference to the Policy dated 26.10.2007 it
is indicated that the similar land owners should receive a
similar consideration  when  representation  is made for
deletion.

Page 13 of 15
13. Having taken note of all the above aspects, the fact
of   the   possession   actually   having   been   taken   would
require determination at the outset based on examination
of records.  Secondly the aspects as pointed out relating
to the deletion of similar lands and as to whether the
land acquired from the appellants is lying vacant and if
so whether the appellant is similarly placed as that of the
other land owners whose case was considered under the
Policy for deletion are aspects which are to be examined
by   the   High   Court   by   notifying   the   respondents   and
permitting them to file their objection statement and also
after securing the records and verifying the same.  Since
such exercise was not undertaken by the High Court,
though   was   required   in   the   present   facts   and
circumstances it would be appropriate to set aside the
order and restore the writ petition to the file of the High
Court for consideration in accordance with law.  Any of
the   observations   contained   herein   are   limited   to   the
disposal of this appeal and the High Court shall dispose
of the writ petition by a considered order on its own
merits.  All contentions in that regard are left open.

Page 14 of 15
14. Accordingly, the order dated 21.10.2015 passed in
CWP   No.   22656/2015   is   set   aside   and   the   petition
bearing CWP No. 22656/2015 is restored on board of the
High   Court   for   the   States   of   Punjab   &   Haryana   at
Chandigarh   for   consideration   afresh   after   affording
sufficient   opportunity   to   both   parties   and   disposal   in
accordance with law.
15. The appeal is allowed in part with no order as to
cost.   All pending applications shall stand disposed of.
 
……………………….J.
(R. BANUMATHI)
……………………….J.
                                              (A.S. BOPANNA)
New Delhi,
September 17, 2019

Page 15 of 15

The operation of the Rent Act cannot be extended to a ‘tenant­insufferance’ vis­a­vis the SARFAESI Act, due to the operation of Section 13(2) read with Section 13(13) of the SARFAESI Act. A contrary interpretation would violate the intention of the legislature to provide for Section 13(13), which has a valuable role in making the SARFAESI Act a self­executory instrument for debt recovery. Moreover, such an interpretation would also violate the mandate of Section 35, SARFAESI Act which is couched in broad terms. As noted above, this case, does not mandate the additional protection to be provided under the Rent Act, to the appellanttenant herein. The lower Courts are correct in ordering delivery of possession to the respondent no. 1­bank as the tenancy stands determined. Before we part, we must note that we have not interpreted the new amendment per se or the law with respect to other categories of tenants, which may be taken up in appropriate cases.

IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
    CRIMINAL APPEAL NO. 1371 OF 2019
(ARISING OUT OF SLP (CRL.) NO. 9590/2015)
BAJARANG SHYAMSUNDER                                  …APPELLANT
AGARWAL     
VERSUS
CENTRAL BANK OF INDIA & ANR.                  …RESPONDENTS
    JUDGMENT
    N.V. RAMANA, J.
1. Leave granted.
2. The   present   appeal   arises   out   of   the   impugned   order   dated
31.12.2014 in Case No. 42/SA/2012 of the Chief Metropolitan
Magistrate, Esplanade, Mumbai rejecting the application of the
intervenor who is the appellant­tenant herein seeking to stay the
execution of order passed under Section 14 of The Securitization
and   Reconstruction   of   Financial   Assets   and   Enforcement   of
Security   Interest   Act,   2002   [hereinafter   referred   to   as     the
‘SARFAESI   Act’]   for   taking   possession   of   the   property   in
question.
3. The property in question is a residential flat admeasuring about
1020   sq.   ft.,   situated   in   Andheri   (West),   Mumbai   (hereinafter
referred   to   as   the   “secured   asset”).   The   secured   asset   was
REPORTABLE
1
mortgaged   by   respondent   no.   2­borrower/landlord  with   the
respondent no. 1­bank in equitable mortgage, by depositing title
deeds   on   20.05.2000,   with   an   intention   to   secure   the   credit
facility. When the respondent no. 2­borrower/landlord  failed to
make   the   due   repayment   of   the   said   credit   facilities,   the
respondent no.1­bank  classified the debt as a “Non­Performing
Asset  (NPA)”.   Thereafter,   on   30.04.2011   a   statutory   Demand
Notice under Section 13 (2) of the SARFAESI Act was issued to
respondent   no.   2­borrower/landlord  demanding   payment   of
Rs.10,72,10,106.73 (Rupees Ten Crores Seventy­Two Lacs Ten
Thousand One Hundred Six and Seventy Three Paisa Only) which
was due as on 30.04.2011.
4. When   the   respondent   no.2­borrower,   failed   to   repay   the
outstanding loan amount,  the respondent no. 1­bank  made an
application   under   Section   14   of   the   SARFAESI   Act   seeking
directions to take physical possession of the secured asset.  This
application   was   allowed   by  the   Chief   Metropolitan   Magistrate,
Esplanade, Mumbai by his order dated 09.03.2012. In this order,
the Magistrate directed the Assistant Registrar to take possession
of the secured asset and handover the same to the respondent no.
1­bank.
2
5. For the brevity of discussion,  it may be pointed out that the
appellant, who claims to be the tenant, asserts that the secured
asset was let out to him by respondent no. 2­borrower/landlord in
January,   2000   and   he   has   been   paying   rent   since   then.
Admittedly, the tenancy was based on an oral agreement. The
appellant­tenant  received a legal notice dated 25.07.2012, from
respondent   no.   2­borrower/landlord  directing   the   appellanttenant  to  vacate  the premises within 15 days. The appellanttenant  preferred a suit being R.A.D Suit No. 652 of 2012 before
the Court of Small Causes at Mumbai against the respondent no.
2­borrower/landlord.  On  18.09.2012,   the   Small   Causes   Court
allowed the application for interim injunction of the  appellanttenant  filed   in   the   above   suit   and   respondent   no.   2­
borrower/landlord was restrained from disturbing the possession
of the appellant­tenant.
6. Meanwhile, the High Court of Bombay, in Criminal Public Interest
Litigation No. 24 of 2011, held that a Magistrate has the power to
pass an order of eviction without giving an opportunity of hearing
to the tenant under SARFAESI proceedings. An appeal against the
aforesaid order along with a batch of other appeals was heard by
this Court in Harshad Govardhan Sondagar v. International
3
Assets   Reconstruction   Co.   Ltd.   and   Ors,  (2014)   6   SCC   1
[hereinafter referred to as ‘Harshad Govardhan Case’]. This Court
directed the Magistrate to decide the applications after giving the
tenants an opportunity of hearing.
7. The  appellant­tenant  preferred   an   application   in   Case   No.
42/SA/2012 before the Chief Metropolitan Magistrate, Esplanade,
Mumbai. By the impugned order dated 31.12.2014, the Chief
Metropolitan   Magistrate   after   hearing   the  appellant­tenant,
rejected the application holding that the appellant­tenant being a
tenant without any registered instrument is not entitled for the
possession of the secured asset for more than one year from the
date   of   execution   of   unregistered   tenancy   agreement   in
accordance with the law laid down in Harshad Govardhan Case
(supra).
8. Aggrieved by the same, appellant­tenant filed this appeal by way
of Special Leave.
9. The   learned   senior   counsel   on   behalf   of   the   appellant­tenant
submitted thata. The   Appellant   was   a   protected   tenant   under   the
Maharashtra   Rent   Control   Act,   1999   [hereinafter
referred to as the “Rent Act”], and was in occupation
of the tenanted premises since October, 2005.
4
B. Even though there was no registered lease deed, the
factum of tenancy can be demonstrated by multiple
rent receipts.
c. The   Small   Causes   Court   made   a  prima   facie
determination of rights in his favour (refer to order in
R.A.D. Suit No. 652 of 2012).
d. the appellant­tenant’s case is covered by the ruling of
this Court in  Harshad   Govardhan   Case  (supra),
and Vishal N. Kalsaria v. Bank of India and Ors.,
(2016) 3 SCC 762 [hereinafter referred to as ‘Vishal
N. Kalsaria Case’].
10. On the contrary, the counsel on behalf of respondent no.1­bank
submits that
a. The  appellant­tenant  and   the  respondent   no.   2­
borrower/landlord  have   devised   this   litigation   to
commit   a   large­scale   fraud   on   the   bank.   The
appellant is not a tenant and has been brought into
the   picture   by   the  respondent   no.2­
borrower/landlord to misuse the process of law and
is not entitled for any equitable relief.
b.   At the time of creation of the mortgage, the bank
officers were given to understand that the family of
5
the   mortgager   was   residing   in   the   secured   asset.
Even   after   multiple   inquiries,   and   even   after
initiating   proceedings   under   Section   14   of   the
SARFAESI   Act,   the   bank   officers   were   never
intimated about the existing tenancy.
c. The respondent no. 2­borrower/landlord, had given a
non­encumbrance certificate to the bank at the time
of creation of the mortgage. 
d. In 2016, the respondent no. 1­bank made enquiries
regarding the status of the secured asset from the
Housing Society which had built the property and is
still maintaining the same. The Society,  vide  letter
dated 12.07.2016, had confirmed that the secured
asset   is   occupied   by   the   respondent   no.   2­
borrower/landlord  and   there   were   no   third­party
rights created over the same.
11. Since the learned senior counsel on behalf of the appellant has
extensively   relied   on   the   judgment   of   this   Court   passed   in
Harshad   Govardhan   Case  (supra) and  Vishal   N.   Kalsaria
Case (supra)   in   support   of   the   proposition   that   a   tenant   is
protected from any ejectment  proceedings under the SARFAESI
6
Act, we have to examine if the law declared by these rulings
accurately reflects the legal position and if these rulings applies to
the facts of the present case.
12. Before we proceed further, the circumstances which led to the
enactment   of   the   SARFAESI   Act   deserve   close   scrutiny.     The
SARFAESI Act was enacted in response to a scenario where slowpaced recovery and staggering amounts of non­performing assets
were looming over the banks.  In order to overcome the practical
reality, and keep in pace with the changing commercial world,
Narasimham Committee I and II and the Andhyarujina Committee
were constituted by the Central Government to provide solutions
for the issues plaguing the banking system of the country.  The
present  Act  is  a culmination  of the  suggestions  made by  the
aforesaid committees intended to enable the bank to resolve the
issue of liquidity and aim for the reduction in the number of nonperforming assets.  The Preamble to the Act emphasises upon the
efficient   and   expeditious   recovery   of   bad   debts.     This   is   also
evident from the scheme of the Act.
13. Section 13 of the SARFAESI Act provides for the enforcement of
security   interest.   This   is   a   self­executory   mechanism   for   the
banks. Once the process of realizing the secured interest takes
7
place,   the   secured   creditor   acts   as   trustee   having  dejure/symbolic possession of the property and is required by law to
realize it strictly in accordance with the provisions of Section 13,
14 and 15 of the SARFAESI Act. Crucially, sub­Section (2) of
Section 13 of the SARFAESI Act envisages a notice, which acts as
the trigger point for initiation of the recovery process under the
SARFAESI Act. In the aforesaid notice, the secured creditor is
required to disclose information on the amount payable by the
borrower and the secured interest intended to be enforced by the
secured creditor in the event of non­payment of the secured debt.
If the borrower fails to discharge the liability, the secured creditor
has   four   options   including   taking   possession   of   the   secured
assets   of   the   borrower   (Section   13(4)   of   the   SARFAESI   Act).
Critically for this case, once a notice is served on the borrower, he
cannot further enter into any contract to create any encumbrance
on   the   property   (Section   13(13)   of   the   SARFAESI   Act).     This
extinguishes   the   right   of   the   mortgagor   to   lease   the   property
under Section 65­A of the Transfer of Property Act [hereinafter
referred to as the ‘T.P. Act’].
8
14. Section   14   of   the   SARFAESI   Act   provides   for   the   procedural
mechanism for taking possession of property and documents with
respect to the secured assets, from the borrower.
15. Section 17 of the SARFAESI Act, dealing with the Right to Appeal
has   been   amended   in   the   year   20161
.   However,   we   are   only
concerned with the earlier law which reads as under ­
17.   Right   to   appeal.—  (1)  Any   person
(including   borrower) aggrieved by any of the
measures   referred   to   in   sub­section   (4)   of
Section 13 taken by the secured creditor or his
authorised   officer   under   this   Chapter,   may
make   an   application   along   with   such   fee,   as
may   be   prescribed,   to   the   Debts   Recovery
Tribunal having jurisdiction in the matter within
forty­five   days   from   the   date   on   which   such
measures had been taken:
          Provided   that   different   fees   may   be
prescribed   for   making   the   application   by   the
borrower   and   the   person   other   than   the
borrower.
……
(2) The Debts Recovery Tribunal shall consider
whether any of the measures referred to in subsection (4) of Section 13 taken by the secured
creditor   for   enforcement   of   security  are   in
accordance  with  the  provisions  of  this  Act
and the Rules made thereunder.
(3)   If,   the   Debts   Recovery   Tribunal,   after
examining the facts and circumstances of the
case   and   evidence   produced   by   the   parties,
comes   to   the   conclusion   that   any   of   the
measures   referred   to   in   sub­section   (4)   of
Section 13, taken by the secured creditor  are
1 The Enforcement of Security Interest and Recovery of Debts Laws and Miscellaneous
Provisions (Amendment) Act, 2016 (44 of 2016).
9
not in accordance with the provisions of this
Act   and   the   Rules   made   thereunder,   and
require restoration of the management of the
business   to   the   borrower   or   restoration   of
possession   of   the   secured   assets   to   the
borrower,   it   may   by   order,  declare   the
recourse   to   any   one   or   more   measures
referred   to   in   sub­section  (4)  of  Section  13
taken   by   the   secured   creditors   as   invalid
and   restore   the   possession   of   the   secured
assets   to   the   borrower   or   restore   the
management   of   the   business   to   the
borrower, as the case may be, and pass such
order   as   it   may   consider   appropriate   and
necessary   in   relation   to   any   of   the   recourse
taken by the secured creditor under sub­section
(4) of Section 13.
(4) If, the Debts Recovery Tribunal declares the
recourse taken by a secured creditor under subsection (4) of section 13, is in accordance with
the provisions of this Act and the rules made
thereunder,   then,   notwithstanding   anything
contained in any other law for the time being in
force, the secured creditor shall be entitled to
take recourse to one or more of the measures
specified under sub­section (4) of section 13 to
recover his secured debt.
(5) Any application made under sub­section (1)
shall   be   dealt   with   by   the   Debts   Recovery
Tribunal   as   expeditiously   as   possible   and
disposed of within sixty days from the date of
such application:
Provided that the Debts Recovery Tribunal
may, from time to time, extend the said period
for   reasons   to   be   recorded   in   writing,   so,
however, that the total period of pendency of the
application with the Debts Recovery Tribunal,
shall not exceed four months from the date of
10
making of such application made under subsection (1).
(6) ………..
(7) Save as otherwise provided in this Act, the
Debts Recovery Tribunal shall, as far as may be,
dispose of the application in accordance with
the provisions of the Recovery of Debts Due to
Banks and Financial Institutions Act, 1993 (51
of 1993) and the rules made thereunder.
(emphasis supplied)
16. Section   17   provides   for   an   invaluable   right   of   appeal   to   any
person including the borrower to approach the Debt Recovery
Tribunal   (hereinafter   referred   to   as   the   “DRT”).     In  Harshad
Govardhan Case (supra) this Court held that the right of appeal
is available to the tenant claiming under a borrower, however the
right of re­possession does not exist with the tenant.  However, in
Kanaiyalal   Lalchand   Sachdev   and   Ors.   vs.   State   of
Maharashtra and Ors., (2011) 2 SCC 782, this Court held that
the DRT can, not only set aside the action of the secured creditor,
but even restore the status quo ante.  We do not intend to express
any view on this issue since it is not relevant for the disposal of
this appeal.   We also note that Parliament has stepped in and
amended Section 17 by the Enforcement of Security Interest and
Recovery   of   Debts   Laws   and   Miscellaneous   Provisions
(Amendment) Act, 2016 (44 of 2016).   Under the amendment,
11
possession   can   be   restored   to   the   “borrower   or   such   other
aggrieved person”.
17. Section 35 of the SARFAESI Act provides an overriding effect over
“anything   inconsistent   contained   in   any   other   law”,   in   the
following manner­
“35.  The provisions of this Act to override
other   laws.­ The provisions of this Act shall
have   effect,   notwithstanding   anything
inconsistent therewith contained in any other
law   for   the   time   being   in   force   or   any
instrument having effect by virtue of any such
law.”
Section   35   is   critical   to   this   case   and   we   will   examine   the
conflicting views on Section 35.
18. The interplay between the SARFAESI Act and the right of the
tenant was first examined by this Court in Harshad Govardhan
Case (supra).  It may be noted that the present appellant was a
party to the aforesaid proceedings.   This Court was confronted
with the question as to whether the provisions of the SARFAESI
Act affect the right of a lessee to remain in possession of the
secured asset during the period of the lease.  After noticing the
scheme of the Act, this Court held that if the lawful possession of
the secured asset is not with the borrower, but with a lessee
12
under a valid lease, the secured creditor cannot take possession
of the secured asset until the lawful possession of the lessee gets
determined and the lease will not get determined if the secured
creditor chooses to take any of the measures specified in Section
13 of the SARFAESI Act.  Accordingly, this Court concluded that
the Chief Metropolitan Magistrate /District Magistrate can pass
an order for delivery of possession of secured asset in favour of
secured   creditor   only  when   he   finds   that   the   lease  has   been
determined in accordance with Section 111 of the T.P. Act.
19. The Court further held that if the Chief Metropolitan Magistrate /
District Magistrate is satisfied that a valid lease is created before
the   mortgage   and   the   lease   has   not   been   determined   in
accordance with Section 111 of the T.P. Act, then he cannot pass
an order for delivery of possession of the secured asset to the
secured creditor.  In case, he comes to the conclusion that there
is no valid lease  either before the creation of mortgage or after
the   creation   of   the   mortgage   satisfying   the   requirements   of
Section 65­A of the T.P. Act or even though there is a valid lease
the same stands determined in accordance with Section 111 of
the T.P. Act, he can pass an order for delivery of possession of the
secured asset to the secured creditor.
13
20. This   Court   also   recognised   the   inconsistency   between   Section
13(13) of the SARFAESI Act and Section 65­A of the Transfer of
Property   Act.     While   Section   13(13)   of   SARFAESI   prohibits   a
borrower from leasing out any of the secured assets after receipt
of a notice under Section 13(2) without the prior written consent
of the secured creditor, Section 65­A of the T.P. Act enables the
borrower/mortgagor to lease out the property.  This inconsistency
was resolved by holding that the SARFAESI Act will override the
provisions of the T.P. Act.
21. Before   concluding,   the   Court   in  Harshad   Govardhan   Case
(supra),  distinguished  the   implications   of  a   registered  and   an
unregistered instrument/oral agreement, in the following manner:
36. We may now consider the contention of the
respondents that some of the appellants have not
produced any document to prove that they are
bona fide lessees of the secured assets. We find
that in the cases before us, the appellants have
relied on the written instruments or rent receipts
issued by the landlord to the tenant. Section 107
of the Transfer of Property Act provides that a
lease of immovable property from year to year, or
for any term exceeding one year or reserving a
yearly rent, can be made “only by a registered
instrument”   and   all   other   leases   of   immovable
property   may   be   made   either   by   a   registered
instrument or by oral agreement accompanied by
delivery   of   possession.  Hence,   if   any   of   the
appellants   claim   that   they   are   entitled   to
possession   of   a   secured   asset   for   any   term
exceeding one year from the date of the lease
made in his favour, he has to produce proof of
14
execution   of   a   registered   instrument   in   his
favour   by   the   lessor.   Where   he   does   not
produce   proof   of   execution   of   a   registered
instrument in his favour and instead relies on
an  unregistered  instrument  or oral  agreement
accompanied   by   delivery   of   possession,   the
Chief  Metropolitan  Magistrate   or   the   District
Magistrate,   as   the   case  may   be,  will  have   to
come to the conclusion that he is not entitled
to the possession of the secured asset for more
than a year from the date of the instrument or
from  the date of delivery  of possession in his
favour by the landlord.
(emphasis supplied)
22. The second case which dealt with the issue of tenants’ rights
under the   SARFAESI Act is  Vishal  N.  Kalsaria  Case (supra).
This   Court   was   concerned   with   the   question   ­   Whether   a
“protected tenant” under the Maharashtra Rent Control Act, 1999
can be treated as a lessee and whether the provisions of the
SARFEASI Act, will override the provisions of the Rent Act?
23. After examining the legal and constitutional position, the Court
held that while the SARFAESI Act has a laudable objective of
providing a smooth and efficient recovery procedure, it cannot
override the objective of Rent Acts to control the rate of rent and
provide protection to tenants against arbitrary and unreasonable
evictions.  To resolve this conflict, this Court held that15
a) The   provisions   of   the   SARFAESI   Act   cannot   be   used   to
override the provisions of the Rent Act.  The landlord cannot
be permitted to do indirectly what he has been barred from
doing under the Rent Act.
b) While   a   yearly   tenancy   requires   to   be   registered,   oral
tenancy can still be proved by showing that the tenant has
been in occupation of the premises before the Magistrate
under Section 14 of the SARFAESI Act.
c) The non­registration of the tenancy deed cannot be used
against the tenant.  For leasehold rights being created after
the property has been mortgaged to the bank, the consent of
the creditor needs to be taken.
d) Even though Section 35 of the SARFAESI Act has a  non
obstante  clause, it will not override the statutory rights of
the tenants under the Rent Control Act.  The non obstante
clause under Section 35 of the SARFAESI Act only applies to
laws operating in the same field.
24. While we agree with the principle laid out in Vishal N. Kalsaria
Case (supra) that the tenancy rights under the Rent Act need to
be respected in appropriate cases, however, we believe that the
holding   with   respect   to   the   restricted   application   of   the  non
16
obstante clause under section 35 of SARFAESI Act, to only apply
to the laws operating in the same field is too narrow and such a
proposition   does   not   follow   from   the   ruling   of   this   Court   in
Harshad Govardhan Case (supra).
25. In our view, the objective of SARFAESI Act, coupled with the T.P.
Act and the Rent Act are required to be reconciled herein in the
following manner:
a) If a valid tenancy under law is in existence even prior to the
creation of the mortgage, the tenant’s possession cannot be
disturbed by the secured creditor by taking possession of the
property.  The lease has to be determined in accordance with
Section 111 of the TP Act for determination of leases.  As the
existence of a prior existing lease inevitably affects the risk
undertaken   by   the   bank   while   providing   the   loan,   it   is
expected of Banks/Creditors to have conducted a standard
due diligence in this regard.  Where the bank has proceeded
to accept such a property as mortgage, it will be presumed
that   it   has   consented   to   the   risk   that   comes   as   a
consequence of the existing tenancy.   In such a situation,
the rights of a rightful tenant cannot be compromised under
the SARFAESI Act proceedings.
17
b) If   a   tenancy   under   law   comes   into   existence   after   the
creation of a mortgage, but prior to the issuance of notice
under Section 13(2) of the SARFAESI Act, it has to satisfy
the conditions of Section 65­A of the T.P. Act.
c) In any case, if any of the tenants claim that he is entitled to
possession of a secured asset for a term of more than a year,
it   has   to   be   supported   by   the   execution   of   a   registered
instrument.  In the absence of a registered instrument, if the
tenant   relies   on   an   unregistered   instrument   or   an   oral
agreement   accompanied   by   delivery   of   possession,   the
tenant is not entitled to possession of the secured asset for
more than the period prescribed under Section 107 of the
T.P. Act.
26. In   the   present   case,   the  bona   fides  of   the   tenant   is   highly
doubtful, as there is no good or sufficient evidence to establish
the tenancy in the first place. The present case involves a tenant
who allegedly entered into an oral agreement of tenancy before
the mortgage deed was entered into between the borrower and
Bank/Creditor.   Additionally,   it   must   be   noted   that   tenancy
created under such an oral agreement, results in a fresh tenancy
after the expiry of statutory period fixed under the T.P Act.
18
27. The records also do not demonstrate that the appellant­tenant
has been able to prove his status as a valid leaseholder to merit
the protection sought for. Admittedly, an equitable mortgage on
the   secured   asset   was   created   by   the   respondent   no.   2­
borrower/landlord  by depositing title deeds with respondent no.
1­bank  on   20.05.2000.   However,   the   date   of   creation   of   the
tenancy is not established in the present case. It is to be noted
that   the   appellant­tenant,   while   seeking   protection   before   the
Small Causes Court, stated that the premises were let out to him
in January, 2000, but the Court noted that the appellant­tenant
produced photocopies of rent receipts for the period of 2001 to
2011. Contrarily, the appellant­tenant, in this appeal before us,
has stated that he entered into the tenancy in October, 2005.
28. The   claim   of   tenancy   made   by   the   appellant­tenant  is   not
supported   by   a   registered   instrument.   We   recognise   the   legal
position, as laid out in the Vishal N. Kalsaria Case (supra), that
in the absence of a written lease deed the tenant may prove his
existing rights by producing other relevant evidence before the
Magistrate.   The   appellant­tenant  has   to   produce   evidence   of
payment of rent, property taxes, etc. Furthermore, if the rent and
permitted increases were payable, then the quantum ought to
19
have   been   mentioned.   In   addition   to   the   above,   the   claim   of
tenancy could have been substantiated by relying upon other tax
receipts   such   as   BMC   tax,   water   tax,   electricity   charges
consumed by the tenant, etc. However, the appellant­tenant has
only submitted xerox copies of rent receipts.
29. Although the Small Causes Court held that the appellant­tenant
seems to have,  prima facie,  a right over the secured asset, the
order   was   passed  ex   parte,  against   the   respondent   no.   2­
borrower/landlord, who did not oppose the application. It is to be
noted that the  prima  facie  case was decided in favour of the
appellant­tenant  solely on the basis of the xerox copies of rent
receipts produced by him.
30. The respondent no. 1­bank  has vehemently contested the  bona
fides  of the appellant­tenant  and has argued that the claim of
tenancy   has   been   raised   just   to   defeat   the   legal   process   of
realisation of dues as per the SARFAESI Act. To substantiate this
claim, the respondent no. 1­bank  has placed on record a legal
scrutiny   report   dated   08.05.2000,   wherein   the   property   is
indicated   to   be   self­occupied   by   the   respondent   no.   2­
borrower/landlord  for   residential   usage.   Additionally,   the
aforesaid fact is corroborated by the non­encumbrance certificate
20
submitted by the respondent no. 2­borrower/landlord at the time
of creation of the mortgage. Furthermore, the respondent no. 1­
bank has also placed a letter dated 12.07.2016 from the Housing
Society that maintains the secured asset, which confirmed that
no tenancy had been created on the secured asset.
31. It is pertinent to note that at the time when the SARFAESI Act
proceedings   were   pending,   the   factum   of   tenancy   was   never
revealed   by   the   parties.     The   earlier   order   dated   09.03.2012,
passed by the Chief Metropolitan Magistrate, Esplanade, Mumbai
directing the Assistant Registrar to take over the possession of the
secured asset, is silent about any existing encumbrance over the
secured asset. It was only after passing of the aforesaid order of
the   Chief   Metropolitan   Magistrate,   that   the   appellant­tenant
started agitating his rights before the Small Causes Court based
on a completely different fact scenario, without a whisper of the
alleged tenancy under the concluded Section 14, SARFAESI Act
proceedings. The respondent no.2­borrower/landlord did not even
respond to the claims of the appellant­tenant.  The respondent
no.1­bank  has produced multiple records to substantiate their
claim that the tenant was nowhere to be seen earlier and that this
tenancy was created just to defeat the proceedings initiated under
21
the  SARFAESI Act.  On the contrary, the  appellant­tenant  has
failed to produce any evidence to substantiate his claim over the
secured asset. In such a situation, the appellant­tenant  cannot
claim protection under the garb of the interim protection granted
to him,  ex parte,  by solely relying upon the xerox of the rent
receipts.
32. In such an event, wherein the claim of the appellant­tenant is not
supported by any conclusive evidence, the rejection of the stay
application by the Chief Metropolitan Magistrate cannot be held
to be erroneous. Although the counsel of the appellant­tenant has
placed ample reliance upon the Vishal N. Kalsaria Case (supra),
but the same would not help the cause of the appellant­tenant
herein,  as the earlier case proceeded with the assumption of a
valid and  bona fide  tenancy. But in the present case, the stay
application of the appellant­tenant seems to be an afterthought. It
is   clear   that   the   respondent   no.   2­borrower/landlord  never
intimated the respondent no. 1­bank about the alleged tenancy.
In light of the above, we are unable to accept the claim of bona
fide tenancy of the appellant­tenant.
33. In   any   case,   considering   the   counterfactual   pleaded   by   the
appellant­tenant himself, that he was a tenant who had entered
22
into an oral agreement, such tenancy impliedly does not carry any
covenant for renewal, as provided under Section 65­A of T.P. Act.
Therefore,   in   any   case,   Section   13   (13)   SARFAESI   Act   bars
entering into such tenancy beyond January, 2012. As the notice
under Section 13 (2) SARFAESI Act was issued on 30.04.2011,
subsequent   reckoning   of   the   tenancy   is   barred.   Such   person
occupying the premises, when the tenancy has been determined,
can only be treated as a ‘tenant in sufferance’. We should note
that such tenants do not have any legal rights and are akin to
trespassers.
34. In this context we may refer to R.V. Bhupal Prasad v. State of
A.P. and Ors., AIR 1996 SC 140, wherein a two Judge Bench of
this Court, speaking through Ramaswamy, J., made the following
pertinent observations in paragraph 8 of the Report:
"8.  Tenant at sufferance is one who comes into
possession of land by lawful title, but who holds it,
by wrong after the termination of the term or expiry
of   the   lease   by   efflux   of   time.   The   tenant   at
sufferance   is,   therefore,   one   who   wrongfully
continues in possession after the extinction of a
lawful title. There is little difference between him
and a trespasser. "
35. On the same lines are the decisions of this Court in Smt. Shanti
Devi v. Amal Kumar Banerjee, AIR 1981 SC 1550, Murlidhar
23
Jalan   (since   deceased)   through   his   Lrs.   v.   State   of
Meghalaya and Ors., AIR 1997 SC 2690 and D.H. Maniar and
Ors. v. Waman Laxman Kudav, [1977] 1 SCR 403.
36. The operation of the Rent Act cannot be extended to a ‘tenant­insufferance’  vis­a­vis the SARFAESI Act, due to the operation of
Section 13(2) read with Section 13(13) of the SARFAESI Act.  A
contrary   interpretation   would   violate   the   intention   of   the
legislature to provide for Section 13(13), which has a valuable role
in making the SARFAESI Act a self­executory instrument for debt
recovery.  Moreover, such an interpretation would also violate the
mandate of Section 35, SARFAESI Act which is couched in broad
terms.
37. As   noted   above,   this   case,   does   not   mandate   the   additional
protection to be provided under the Rent Act, to the appellanttenant herein. The lower Courts are correct in ordering delivery of
possession to the respondent no. 1­bank  as the tenancy stands
determined.   Before   we   part,   we   must   note   that   we   have   not
interpreted the new amendment per se or the law with respect to
other categories of tenants, which may be taken up in appropriate
cases.
38. In the present case, as we are in the year 2019, which is 7 years
beyond the deadline of 2012, it is ordered that the appellant24
tenant shall hand over the possession of the secured asset within
12 weeks of this order to the Assistant Registrar at Bandra Centre
of Courts, Mumbai, who in turn shall deliver the same to the
respondent no.1­bank. This Court is further of the opinion that
such devious practices by the borrower to obstruct the rights of
the bank to legitimately realize its dues cannot be appreciated by
this Court. Accordingly, we dismiss this appeal.
..............................................J.
(N.V. RAMANA)
 ..............................................J.
 (MOHAN M. SHANTANAGOUDAR)
..............................................J.
 (INDIRA BANERJEE)
New Delhi,
September 11, 2019
25