Sharafat Ullah v. Municipal Board — 1979 DIGILAW 1066 (ALL)

JUDGMENT Deoki Nandan, J. -This is a defendants second appeal in a suit filed by the respondent Municipal Board, Moradabad. 2. 403 sq. yds. of land was sanctioned to be sold in favour of the defendant-appellant by the then Officer in charge of the respondent Municipal Board, at the rate of Rs. 3 per sq. yd. and on 2nd Feb., 1965 the defendant-appellant deposited the entire price amounting- to Rs. 1,209 for which the land was sanctioned to be sold in his favour. Possession was thereafter delivered on behalf of the respondent Municipal Board on 12th Feb., 1965 to the defendant-appellant. The defendant-appellant thereafter applied for permission to make some construction over the land. That permission was granted on 15th June, 1965 with a slight modification. On 29th Dec., 1965 the defendant-appellant is said to have sold the land to his wife by a sale-deed for Rupees 1,000. It appears that when the defendant-appellant raised some construction thereon, trouble was created by the residents of the locality and a proceeding under S. 145, Cr. P. C. was initiated by the City Magistrate and on 30th March 1966, the land was attached. On account of the said proceeding under S. 145, Cr. P. C. and memorials submitted to the Chief Minister etc., the District Magistrate directed the Officer in charge of the respondent Municipal Board to look into the matter and on 14th Sept., 1966 the then Officer in charge reported to the District Magistrate that the transfer of the land to the defendant-appellant was illegal for want of District Magistrates permission. The District Magistrate thereupon withheld his permission for the transfer and directed the Officer in charge to take steps to take back possession of the land. The proceedings under S, 145 Cr. P. C., however, terminated in favour of the defendant-appellant on 28th Mar., 1967 and the land was directed to be released in his favour and possession was restored to him on 31st Mar., 1967. A notice was thereafter issued by the District Magistrate to the defendant-appellant to the' effect that the proposal for the sale had illegality been approved by the then Officer in charge and when he came to know of it he had disapproved the same and it has been decided to return the deposit of Rs. 1,209 and, he, the defendant-appellant, should remove his possession from the land and take back, his deposit. 3. 1,209 and, he, the defendant-appellant, should remove his possession from the land and take back, his deposit. 3. It was in this background of the facts that the respondent Municipal Board filed the suit giving rise to this appeal praying for the relief that it may be declared that the plaintiff-respondent is the owner of the land and further that the sanction of the sale by the Officer in charge by order dated 30th Jan., 1965 and the permission to raise construction, given by the then Executive Officer by his order dated 15th June, 1965 and the action of the plaintiffs Officers in accepting the sale money and in delivering possession of the land were all illegal, unenforceable, null and void and not. binding on the plain tiff-respondent. Dispossession of the defendant and demolition of the construction raised by him on the land was also sought. Further, a permanent injunction was sought to restrain the defendant from making any construction over the land, or in any other manner changing its nature. The ground on which it was claimed by the respondent Municipal Board that the sale of the land by the then Officer in charge was illegal and unauthorised was, to quote its own words in the plaint:- (a) That the then Officer in charge had no legal authority to sanction sale of the land in suit to defendant No. 1 nor any official of the Board had any legal authority to accept any deposit nor any official of the plaintiff had any legal power or right to accord permission for any construction (on) the said land. (b) That the then officials of the plaintiff committed mistake of fact and law and even misrepresentation and fraud on plaintiff in not noting that the plaintiffs property in suit could not be legally transferred without the previous approval of the prescribed authority and in such manner and on such terms and conditions as the prescribed authority may prescribe. The prescribed authority in the present case is the District Magis-crate, Moradabad." i am for the present omitting the grounds raised against the grant of the sanction for construction. 4. The defendant denied the plaintiffs claim. The trial court framed a large number of issues, 14 in number, and having found for the plaintiff it decreed the suit for the declarations, and for possession. 4. The defendant denied the plaintiffs claim. The trial court framed a large number of issues, 14 in number, and having found for the plaintiff it decreed the suit for the declarations, and for possession. as also for demolition and prohibitory injunction as claimed by the plaintiff. The lower appellate court partly allowed the appeal and modified the decree of the trial court by ordering that the decree shall fee executable only if the respondent Municipal Board deposits the sum of Rs. 1,209 in favour of the defendant-appellant 31st May, 1969. 5. Having heard learned counsel for the appellant, I feel that this appeal must succeed on the short point that the then Officer in charge of the respondent Municipal Board was 'the Board under the relevant notification issued by the State Government under S. 31 (b) of the U. P. Municipalities Act. He had all the powers of the Board and it, is not disputed that the Board could, in its discretion, sell or transfer its property. Under ground (b) as raised in the plaint and quoted above, for claiming that the transfer was illegal, reliance appears to have been placed on R. 2 of the Rules relating to transfer of property vested in the Board framed by the State Government in exercise of its powers under the Act. The rule is printed at page 351 of the U. P. Municipal Manual, 1452 (sic) edition. The precise ground raised is that the proposed transfer was not sanctioned by the prescribed authority and that the prescribed authority was the District Magistrate. This rule was amended by a Notification No. 2684-B/XI-B-3185-57. Before amendment the wording of the rule was as follows: "2. Immovable property vested in the Board shall not, except' with the previous approval of the prescribed authority and in such manner and on such terms and conditions as the prescribed authority may approve be relinquished or transferred by the Board by way of sale, or by way of mortgage, charge or exchange, or otherwise than by way of lease without a premium. If the capital value of the property does not exceed Rs. 500 the powers of the prescribed authority under the rule shall vest in the District Magistrate. If the capital value of the property does not exceed Rs. 500 the powers of the prescribed authority under the rule shall vest in the District Magistrate. Immovable property of which the Board is recorded as the owner shall, for the purposes of this rule, be deemed to be vested in the Board: Provided that when any land acquired under the Land Acquisition Act ceases to be used or required for the purpose mentioned in the notification of its acquisition fey the Board, the Board shall relinquish such land to the Collector of the district who will dispose of it, in accordance with the rules in Chapter XX of the Revenue Department Manual and pay the proceeds to the Municipal Board, less any expenditure incurred in its disposal." 6. After the amendment Rule 2 read as follows:- "2. The Board shall not relinquish or transfer by way of sale, exchange, mortgage or otherwise than by way of lease without a premium or create charge on any immovable property owned by or vested in it, the capital value whereof exceeds Rs. 509 except; I. If the capital value of the property does not exceed Rs. 2,500 with the previous approval of the District Magistrate. II. If the capital value of the property exceeds Rs. 2,500, but does not exceed Rs. 10,000 with the previous approval of the Commissioner; and III. If the capital value of the property exceeds Rs. 10,000 with the previous approval of the State Government. All such transfer shall further be subject to such terms and conditions as the appropriate authority approving the transfer or creation of charge may prescribe : Provided that when any land acquired under the Land Acquisition Act ceases to be used or required for the purpose mentioned in notification of it's acquisition by the Board, the Board shall relinquish such land to the Collector of the District who will dispose of it, in accordance with the rules in Chapter XX of the Revenue Department Manual and pay the proceeds to the Municipal Board less any expenditure incurred in its disposal." 7. A comparison of the two provisions would show that while before the amendment a transfer of immovable property vested in the Board could be made only with the previous approval of the Prescribed Authority; and that in case the 'capital value of the property did not exceed Rs. A comparison of the two provisions would show that while before the amendment a transfer of immovable property vested in the Board could be made only with the previous approval of the Prescribed Authority; and that in case the 'capital value of the property did not exceed Rs. 500, the powers of the Prescribed Authority under the Rule vested in the District Magistrate. After the amendment, the property of which 'the capital value did not exceed Rs. 500 may be transferred by the Municipal Board without having to take any approval from any one, but in case 'the capital value of the property exceeds Rs. 500 but did not exceed Rs. 2,500 the previous approval of the District Magistrate was required, and in case the capital value exceeds Rs. 2,500, the previous approval of the Commissioner was required, and if the capital value exceeds Rs. 10,000 the previous approval of the State Government was required. There is no mention of the Prescribed Authority in the amended rule. The reference to the requirement of approval of the Prescribed Authority in the plaint, and the statement that the District Magistrate was such Prescribed Authority shows that the plaintiff Municipal Board was relying on the rule as it existed before the amendment. The. rule had been amended in 1957 long before the sale of the land in question to the defendant-appellant. The plaintiff-respondent has in its plaint accused its officials of not bringing the correct rule to the notice of the Officer In charge. The plaintiff, in spite of the legal advice which it must have obtained before filing the plaint, does not say that it was not aware of the correct rule even when the plaint was filed. At the time when sale was sanctioned by the then Officer In charge in January 1965, the approval of the District Magistrate was required only if 'the capital value of the property exceeded Rs. 500. Obviously 'the capital value does not mean the price for which the land is sold or transferred or its current market price as the rule contemplates not only a transfer by way of sale but also other kinds of transfer by way of relinquishment, exchange or mortgage or lease etc. The reference is to 'the capital value of the land to the Municipal Board, that is, its cost as entered in its books. The reference is to 'the capital value of the land to the Municipal Board, that is, its cost as entered in its books. It cannot be said that simply because the price for which the land was agreed to be sold by the then Officer In charge to the defendant appellant was Rs. 1,209 that must have been 'the capital value of the land to the Municipal Board. On the other hand it is well-known that the price of land has been rising at a very fast rate during the recent past and the capital value of the land vested in public authorities is generally much lower than the market price of the land. Moreover, there is no plea raised by the plaintiff-respondent that 'the capital value of the land exceeded Rs. 500, nor is there any evidence in support thereof. In these circumstances it cannot be said on the basis of the amended Rule as it existed in the year 1965 that any prior approval of the District Magistrate, or any other authority, was needed for the transfer of the property by the plaintiff Municipal Board at the time when the transfer in question was sanctioned or purported to be made by the Officer In charge, who as seen above was the Board for all the purposes. 8. In view of the above position the principal contention which was the very basis of the plaintiff-respondents case falls. If the sale of the land made by the plaintiff-respondent to the defendant-appellant was not illegal, and the price having been received and possession having been delivered, the plaintiff-respondent could not, on any authority of law, be entitled to regain possession of the land or to get a declaration that it was the owner of the land. That being so and the defendant-appellants possession over the land being lawful, the plaintiff-respondent could not have, in exercise of its statutory powers, refused permission to raise construction on the land which was applied for by the defendant-appellant, in case, of course, the proposed construction complied with the relevant bye-laws. It has been seen above that the construction proposed was sanctioned by the respondent Municipal Board subject to certain modifications. Under the circumstances the sanction granted by the plaintiff-respondent to the defendant-appellant to raise construction on the land, cannot also be assailed. In the result this appeal must succeed and is allowed with costs. It has been seen above that the construction proposed was sanctioned by the respondent Municipal Board subject to certain modifications. Under the circumstances the sanction granted by the plaintiff-respondent to the defendant-appellant to raise construction on the land, cannot also be assailed. In the result this appeal must succeed and is allowed with costs. The plaintiff-respondents suit shall stand dismissed with costs throughout.