The Union of India & Ors. v. Harbans Lal (dead) through LRs

plaintiff/respondent was decreed for recovery of mesne profits. The plaintiff/respondent filed a suit for rendition of accounts against the defendants alleging therein that there was evacuee property consisting of a garden and Industrial Establishment No.2, situated at the G.T.Road, Gurdaspur. The property measured 4 standard acres and 2 units. Part of property was illegally allotted to Smt. Balwant Kaur, which was garden measuring 4.8 acres and 2 units. Sanad was issued in her favour. The other property i.e. industrial establishment No.2 was auctioned on

18.7.1952. Son of the plaintiff was highest bidder to purchase of lessee rights. The bid given by the son of the plaintiff was confirmed by the Inspector, Evacuee Property, Industrial Establishment, Batala, vide letter dated 9.10.1954. The case of the plaintiff was that subsequently, it was found that allotment in favour of Smt.Balwant Kaur was illegal. The allotment in her favour was cancelled. Writ petition filed by her in the High Court was also dismissed and she thus, became an illegal occupant of the said property. It is pertinent to notice here that she was not made a party to the suit, filed for recovery of mesne profits. The case of the plaintiff was that in addition to industrial establishment II, he was also entitled to possession of above mentioned compound/garden. The plaintiff filed a suit for specific performance of the agreement against Union of India, wherein a compromise decree was passed RSA No.438 of 1985 3 against Union of India in favour of plaintiff/respondent. Plaintiff/ respondent, therefore, claimed that he was entitled to the possession of the property including the compound. The plaintiff/respondent claimed that the defendant/respondents recovered rent from illegal occupants. They were, therefore, liable to render account of rent, damages and compensation so realized from the illegal occupants. The tentative value of the suit was assessed at Rs.10,000/- (Rupees ten thousand only). In the alternative, prayer was made for recovery of the mesne profits from the date of transfer of the property till the date of delivery of possession. The plaintiff/respondent issued a notice under section 80 of the Code of Civil Procedure and thereafter the suit was instituted. The suit was contested by the Union of India, as well as the State of Punjab, wherein objection was taken that the civil court had no jurisdiction to entertain and try the suit. It was the case of the defendant/appellants that the plaintiff/respondent had equally efficacious remedy under the Displaced Persons (C& R) Act, 1954. On merit, stand taken was, that there was no demarcation between the garden and industrial establishment. The particulars of the property as given in the plaint were denied. It was admitted that the writ filed by Smt.Balwant Kaur against cancellation of allotment in her favour was dismissed by the High Court. It was pleaded that defendant No.2, as agent of defendant No.1, was only concerned in implementing the decree. Plaintiff had also filed a complaint before the Department against the RSA No.438 of 1985 4 conveyance deed in respect of the industrial establishment by claiming it to be incorrect. The plaintiff/respondent was called to appear vide letter dated

3.10.1977 before the Managing Officer, but he chose not to appear. The presumption was, therefore, drawn by the defendants, that he was satisfied with the conveyance deed. Suit was claimed to be an afterthought. On the pleadings of the parties, learned trial court framed the following issues:-

1. Whether the suit is not maintainable on the grounds as mentioned in para No.1 of the pre-objections of the written statement? OPD

2. Whether the court has no jurisdiction to try this suit? OPD

3. Whether the plaintiff is entitled to a decree of rendition of accounts? OPP

4. Whether in the alternative the plaintiff is entitled to decree for mesne profits? OPP

4. Relief. Issues No.1 and 2 were initially held against the plaintiff/respondent and the suit filed by the plaintiff/respondent was ordered to be dismissed. The plaintiff/respondent filed an appeal which was disposed of by the learned Additional District Judge, Gurdaspur vide order dated

25.9.1982, and directions were issued to the trial court to decide all the issues on merit. RSA No.438 of 1985 5 Learned trial court allowed the parties to lead evidence. On appreciation of evidence the learned court , on issue No.1, held that the civil court could not decide about the property as long as it remained in the compensation pool but on its allotment to an individual it fell in the jurisdiction of the civil court. The learned trial court on issue No.1 held that the answer to this issue would depend, on as to whether plaintiff/respondent was able to prove the area of the property conveyed to him. On issue No.2, learned trial court held that once the property goes out of compensation pool the authorities under the Act were divested of the jurisdiction. Issue No.2 was decided in favour of the plaintiff/respondent. On issue No.3, learned trial court held that the plaintiff in his plaint had taken a stand that his son had given the highest bid which was accepted. The conveyance deed, if any, was to be issued in favour of his son. The learned trial court observed that son of the plaintiff/respondent was alive and the plaintiff, therefore, did not have any locus standi to maintain the suit. Though in the evidence the plaintiff/respondent had tried to make out a case that the property acquired by his son had become HUF property, but this stand was not accepted, as his son had not appeared to depose that the property acquired was pooled in HUF property. Learned trial court further held that the plaintiff/respondent had failed to produce the conveyance deed, even though a specific stand was taken that the RSA No.438 of 1985 6 conveyance deed was executed in his favour. Learned trial court on appreciation of evidence further observed that the properties transferred to the plaintiff, was a subject of debate and speculations. This finding was recorded in view of the fact that the stand taken by the plaintiff/respondent was that a suit for specific performance of agreement was filed, which was decreed on 28.11.1976 by the learned Sub Judge First Class, Gurdaspur copy of which was placed on record. In the said decree the plaintiff was directed to deposit the money and interest, and it was only on deposit thereof that the conveyance deed was to be issued, but no evidence was led by the plaintiff/respondent regarding the deposit of money. Receipt Ex.P.3 which was produced in proof of deposit of money was also placed before the learned court in a suit for specific performance. Thus, the learned trial court recorded a finding of fact that the plaintiff/respondent had failed to prove the details of the property which was transferred to him and the date of the transfer. Plaintiff/respondent in cross-examination admitted that possession of the built up area was given to his son. The learned trial court, therefore, did not find any reason for the plaintiff to seek the decree asked for. The learned trial court also held that rendition of accounts can be asked only from an agent, but there was no proof of agency. It was further held by the learned trial court, that the plaintiff had miserably failed to prove that any amount was recovered by the appellants from the alleged RSA No.438 of 1985 7 illegal occupants of the property nor those occupants were impleaded as party. Issue No.3 was, therefore, decided against the plaintiff/respondent. Learned trial court, on issue No.4, held that allegations regarding mesne profits were also vague as nothing was disclosed regarding period for which mesne profits was sought. Issue No.4 was also decided against the plaintiff/respondent. Consequently, suit was dismissed. Plaintiff/respondent preferred appeal. Learned lower appellate court did not record issue-wise findings. The learned appellate court also did not give any reason to disagree with the trial court on issues No.3 and

4. Learned lower appellate court disposed of the appeal merely on surmises by drawing inference. Though no evidence was led to prove the case set up in plaint, as would be clear from the details hereinafter mentioned. Learned lower appellate court held, that lease of industrial establishment No.2 in favour of son of the plaintiff was admitted. It was also admitted that the garden was allotted to Smt. Balwant Kaur. Allotment made in favour of Smt. Balwant Kaur was cancelled, and she filed writ which was also dismissed. On cancellation of allotment to Smt.Balwant Kaur property reverted back to the Central Government. Therefore, the possession of Smt. Balwant Kaur became illegal and the Central Government became entitled to recover rent from her. There is absolutely no basis for this finding. The learned lower appellate court thereafter went to record that there was no demarcation between the property allotted to Smt. Balwant Kaur, and one leased out to the son of the plaintiff which was given on RSA No.438 of 1985 8 lease and confirmed by the Inspector, Evacuee Property, Batala. Description of industrial plot No.2 tallied with one given in the plaint. Learned lower appellate court, thereafter proceeded to record a finding that on failure of the Union of India to execute a conveyance deed the plaintiff/respondent filed a suit for specific performance. Suit was decreed with regard to the industrial establishment No.2, as per allotment. The learned lower appellate court held that the entire amount as desired by the Custodian was paid and conveyance deed was issued in his favour, but that conveyance deed did not mention the garden attached to Industrial Established as stands mentioned in the register. Learned lower appellate court, thus held that only possession of built up area was given, whereas possession of other three plots was not with the son of the plaintiff. The learned lower appellate court took note of the suit for specific performance and presumed that the property stood allotted and transferred in favour of the appellants in the year 1954. The appellate court merely on presumption came to the conclusion that the plaintiff/respondent was entitled to mesne profit, and decree for a sum of Rs.7200/- (Rupees seven thousand and two hundred only) was passed with costs in favour of the plaintiff/respondent. The plaintiff/respondent was held entitled to mesne profits from the date of filing of the suit, till the date of possession. However, this decree was subject to payment of court fee. Mr. N.S.Virk, learned Additional Advocate General, Punjab, appearing on behalf of the appellants contends, that this appeal raises following substantial questions of law for consideration by this court:- RSA No.438 of 1985 9

1. Whether the learned lower appellate court could reverse the judgment and decree passed by the learned trial court without meeting with the reasons given by the learned trial court merely on surmises and presumptions?

2. Whether the learned lower appellate court was bound to record findings on all the issues, before reversing the judgment and decree passed by the learned trial court? In support of substantial questions of law referred to above, learned Additional Advocate General for the appellants vehemently contended that the learned lower appellate court has given no reason as to how the suit for rendition of accounts was competent, in spite of the fact that the learned trial court was pleased to hold that in the absence of proof of agency no suit for rendition of accounts was maintainable. It was also the contention of the learned State Counsel that in the present case in order to succeed in claim of mesne profits it was necessary for the plaintiff/respondent to have shown his ownership in pursuance to the decree of specific performance passed in his favour. The plaintiff/respondent did not produce any evidence in proof of his ownership, nor any evidence was led to show that in pursuance to the judgment and decree the plaintiff/respondent had deposited the amount with interest, ordered in the decree. Learned lower appellate court merely decided the case on presumption of allotment in his favour in 1954, even though there was no RSA No.438 of 1985 10 evidence, whatsoever, as to who was in possession of the property and was liable to pay the mesne profits. Plaintiff/respondent had also not chosen to implead any occupant as party to the suit, who was said to have paid rent to the Central Government on account of his illegal occupation. Learned lower appellate court has also not taken note of the fact that in spite of allotment in favour of the plaintiff, a suit for specific performance was filed which was only decreed in 1976. However, there was no proof of the execution of the decree by deposit of money with interest as was ordered in the judgment and decree. Mr. B.R.Mahajan, learned counsel for the respondent, however, supported the decree on the plea that once it was proved that property was allotted to the plaintiff/respondent, there was nothing wrong with the learned lower appellate court to draw presumption of illegal occupation of the defendant-appellants, to pass a decree of mesne profits on the basis of evidence led. However, on consideration, I find force in the contentions raised by the learned Additional Advocate General for the appellants. The suit for rendition of accounts was per se not maintainable. Learned lower appellate court could not reverse the judgment and decree passed by the learned trial court on appreciation of evidence without meeting the reasoning given by the learned trial court in dismissing the suit. The judgment and decree passed by the learned trial court was based on appreciation of evidence and could not be said to be perverse. It is now well settled, that the appellate court while reversing the judgment and RSA No.438 of 1985 11 decree is required to meet with the reasoning given by the learned trial court. The judgment of the learned lower appellate court shows that it is based merely on presumption which are against the positive evidence on record. The presumption of allotment in favour of the plaintiff/respondent, is totally misconceived as admittedly the property was allotted to Smt.Balwant Kaur, and was only subsequently cancelled. It may also be noticed here that though it was specifically pleaded, that the decree for specific performance was passed in favour of the plaintiff/respondent, no evidence was led to prove the execution of decree or payment of money along with interest. Reliance was placed on Ex.P.3, which was receipt issued which was placed on record at the time of filing of suit for specific performance. In spite of Ex.P.3 directions were issued to the plaintiff/respondent to pay additional money along with interest, for the allotment of garden which was claimed to be the part of the property. Learned lower appellate court has also not reversed the findings recorded by the learned trial court holding that the suit was vague and lacked material particulars to claim a decree for mesne profits. Substantial questions of law, therefore, are answered in favour of the appellants. It is held that the learned lower appellate court has reversed the judgment and decree passed by the learned trial court, without meeting with the reasons given for dismissal of suit by the learned trial court. The judgment and decree passed by learned lower appellate court is based on conjectures and presumptions drawn are contrary to the pleaded RSA No.438 of 1985 12 case and evidence led, therefore, can not be sustained in law. Consequently, this appeal is allowed. Judgment and decree passed by the learned lower appellate court is set aside and that of the learned trial court is restored, but with no order as to costs.

22.02.2010 (Vinod K.Sharma) Judge