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2000 DIGILAW 758 (MAD)

N. Nallasamy Gounder & Others v. The Government of Tamil Nadu & Others

2000-08-02

S.JAGADEESAN

body2000
Judgment : 1. In all these cases, the relief sought for by the petitioners is identical. By consent of learned counsel appearing for all the parties, the writ petitions were taken up for joint disposal. 2. The petitioners are the owners of the lands of different extents in different survey field numbers situated in different villages. Since the descriptions of the properties have been furnished in the individual affidavits of the petitioners, it is unnecessary to extract the same herein in detail. 3. The Government thought fit to acquire the lands belonging to the petitioners herein in order to provide house sites for Adi dravidas. Ultimately, to avoid any delay, by initiating the acquisition proceedings under the Land Acquisition Act, the Government also thought fit to go in for private negotiations. A Committee was appointed for the purpose of having negotiations with the landowners. There is no dispute that the Government had appointed the Committee under the Chairmanship of the District Collector consisting of the District Revenue Officer, and Revenue Divisional Officer/Sub-Collector as Members and the District Adi dravidar Welfare Officer as a Convener. .4. In G.O.Ms.No.146, Adi dravidar and Tribal Welfare Department, dated 18. 1995, the Government directed the Constitution of the State Level Committee consisting of the Commissioner of Land Administration as Chairman, the Director of Adi Dravidar and Tribal Welfare Department as a Member and the Joint Commissioner (Land) as Member Secretary. Pursuant to the formation of the Committees, the private negotiations were entered into between the petitioners and the respondents and ultimately, the prices of the lands were determined. After the approval of the same by the Government, the requisite sale deeds were executed by the landowners in favour of the Government and the sale deeds were also registered. There is also no dispute that the registration charges were paid by the landowners. Subsequent to the execution of the said sale deeds, now, the third respondent, in the impugned proceedings, informed the landowners -the petitioners herein that the respondents have decided to reconvey the lands to the landowners. Challenging the same, the present writ petitions have been filed. 5. There is also no dispute that the registration charges were paid by the landowners. Subsequent to the execution of the said sale deeds, now, the third respondent, in the impugned proceedings, informed the landowners -the petitioners herein that the respondents have decided to reconvey the lands to the landowners. Challenging the same, the present writ petitions have been filed. 5. Respondents 3 and 4 have filed the counter affidavit, in which, it is stated that the Government, after execution of the sale deeds, came to know that certain fraud had been committed by the landowners in collusion with the officials of the State and the price determined by the Committee is not in conformity with the market rate. The prices determined through the private negotiations are much more than the market rate. Hence, action was taken against the concerned officials for colluding with the landowners. As a fraud has been committed by both the petitioners as well as the officials in collusion to cheat the Government, it has been decided to cancel the sale deeds and to reconvey the lands to the landowners. When once it is established that the price determined in the private negotiations is higher than the market rate, the Government cannot be compelled to part with the funds irrespective of the fraud committed by the parties. Consequently, the impugned orders were passed cancelling the registered sale deeds. It is also directed that the properties have to be reconveyed to the petitioners herein and the revenue register also has to be transferred in the name of the original landowners. 6. Mr.R.Krishnamoorthi, learned Senior Counsel for the petitioners contended that the transaction of sale is completed, when once the sale deeds are registered irrespective of the payment of consideration. In all these cases, admittedly, the sale deeds in favour of the Government had been registered. When once the sale deeds are registered, the title passes on to the purchasers. Hence, either the cancelling of the sale deed or reconveying the properties in the name of the original owners cannot be done by way of Government Executive Orders. Hence, the impugned orders in all these writ petitions cancelling the sale deeds are totally void and have no effect under law. Consequently, the impugned orders are liable to be set aside. 7. Hence, the impugned orders in all these writ petitions cancelling the sale deeds are totally void and have no effect under law. Consequently, the impugned orders are liable to be set aside. 7. Mr.V.Ragupathi, learned counsel for the petitioner in W.P.No.17515 of 1999 and Mr.M.S.Palanisamy, learned counsel for the petitioners in W.P.Nos.18131, 18132 and 18322 of 1999 also raised the same pleas as that of Mr. R.Krishnamoorthi, learned Senior Counsel. .8. On the contrary, Mr.V.M.Rajavelu, learned Special Government Pleader appearing on behalf of the respondents contended that the mere fact that the sale deeds have been executed in favour of the Government and the sale deeds were registered would not take away the rights of the respondents to cancel the same, especially when it was found out that a fraud had been committed in the determination of the price for the lands. It is true that the District Level Committee as well as the State Level Committee were appointed for private negotiations and for finalisation of the transaction. Relying upon the report of such Committees, the private negotiations were proceeded with and the sale was completed by the registration of the conveyance deeds. When, subsequently, the Government came to know that the prices determined by the officials through the private negotiations with the landowners do not represent the correct and true market value, the Government has got every power or right to cancel such sale deeds. The impugned orders clearly reveal that the documents are not genuine documents and are liable to be cancelled and accordingly, the same are cancelled and the Government executed the release deeds and necessary entries are made in the revenue register. The original owners would become the owners of the respective lands and hence, the impugned orders are quite valid. 9. I have carefully considered the contentions of the respective counsel. There is no dispute that the petitioners as well as the respondents had entered into private negotiations for the purchase of the lands of the petitioners. Ultimately, the price was determined by the Government officials on behalf of the respondents. After such determination of the prices, the Government approved the negotiations and ultimately, sanctioned the purchase of the lands. The necessary sale deeds were also executed by the petitioners-the landowners, and thereafter, those documents were registered as early as 1996. Ultimately, the price was determined by the Government officials on behalf of the respondents. After such determination of the prices, the Government approved the negotiations and ultimately, sanctioned the purchase of the lands. The necessary sale deeds were also executed by the petitioners-the landowners, and thereafter, those documents were registered as early as 1996. The petitioner in W.P.No.17050 of 1999 was paid a sum of Rs.9,74,300 by way of part consideration. So far as other petitioners are concerned, even though the sale deeds were registered, the sale consideration has not yet been paid. It is a fact that the registration charges were paid by the petitioners-the vendors. 10. When the landowners demanded the sale consideration of the lands, a notice dated 29. 1999 seemed to have been served on all the petitioners herein. In the said notice, it has been specifically mentioned about the registration of the sale deeds and also the non-payment of sale consideration by the Government. It is further stated in the said notice that the possession of the lands has not been taken by the Government and the landowners are still in possession of the lands. Now that the lands are not acquired by the Government, the Government does not claim any right over the same. Further, orders have already been passed to change the entries in the revenue records showing the ownership of the lands in the name of the petitioners. It is open to the petitioners to enjoy the lands as they like and for creating any encumbrance, the Government has no objection. It is also stated that since the sale deeds had been registered in the name of the District Collector, the Government is willing to execute the release deed in favour of the petitioners. The landowners were requested to give their consent to take the release deeds within fifteen days, failing which, the Government would take necessary steps to cancel the sale deeds through the court. However, the petitioners herein did not give their consent. 11. It may be pertinent to note that even though the notice is dated 29. 1999, the impugned order of cancellation of the registration is dated 9. 1999. Hence, it is highly doubtful as to whether the notice dated 29. However, the petitioners herein did not give their consent. 11. It may be pertinent to note that even though the notice is dated 29. 1999, the impugned order of cancellation of the registration is dated 9. 1999. Hence, it is highly doubtful as to whether the notice dated 29. 1999 had been served on the petitioners herein and even if it has been served, the willingness of the landowners asked for is only a farce, especially when the Government had already passed the impugned orders. 12. Coming to the impugned order, it is better to extract the same: PROCEEDINGS OF THE COLLECTOR, ERODE DISTRICT, ERODE PRESENT: THIRU S.KARUTHIAH PANDIAN, I.A.S. Ref.No.88020/96/T9 dated 9. 1999 Sub: ADW - Erode District - Kangeyam Taluk Nezhali village S.No.1362, 1363/4 and 1364/4 measuring 15. 0 hec. (or) 12.72 acres purchased land by private negotiation irregularities noticed in the fixation of land value fraudulent transaction regarding. Ref: Proceedings of the District Level Committee dated 10. 1996. In the reference cited, land value was fixed by the District Level Committee at the rate of Rs.1,40,000 per acre for purchasing the following land in Nezhali village of Kangeyam taluk in Erode district for providing house sites to the landless and houseless poor Adi dravidars. Taluk Village S.No. Extent Hec. Acres Kangeyam Nezhali 1362 32. 0 5.73 1363/4 50. 0 3.70 1364/4 33. 0 3.29 Total 15. 0 12.72 The document was registered by the landowners in the Sub-Registrars Office, Kangeyam Taluk. As there was no sufficient allotment of funds, the land value was not paid. Even the registration fee was not paid by the Collector. The landowner Thiru M.Nallasamy Gounder himself paid the registration fee and got the document registered. 2. Subsequent to the registration of the document, it has come to the notice of the Government that the land value fixed in this case was not genuine, because it was based on a sale intentionally created by the landowner to boost the land value to get exorbitant rate for the land offered by him to the Government. The District Level Committee was mislead by the document produced by the landowners in fixing the land value. Hence, it was clear that the transaction was not genuine. 3. The District Level Committee was mislead by the document produced by the landowners in fixing the land value. Hence, it was clear that the transaction was not genuine. 3. In the above circumstances, it has since been decided to reconvey the land to the landowners due to the following reasons: .(i) The Government have not spent any amount towards the registration fees and the power holder himself has voluntarily paid the registration fee with an ulterior motive to get an exorbitant value. .(ii) The transaction was not bona fide as the fixation was based on a date sale which was not at all genuine. (iii) The landowners have mislead the officials also to fix exorbitant price on the basis of a collusive document. .(iv) The lands were not taken over possession by the Government and the lands are continued to be under physical possession of the landowner and hence, the landowners have not sustained any loss. .(v) The lands are not at all required by the Government. 4. The transfer of registry made on the basis of the fraudulent document is hereby ordered to be cancelled and the properties are ordered to be reconveyed and the transfer of registry has been made to the original owners of the land. 5. In as much as the document is considered to be not genuine and it has not been accepted, it is treated as cancelled. Sd/.S.Karuthiah Pandian Collector. (Names of the owners in the impugned orders in each writ petitions differ). 13. A perusal of the impugned order reveals that subsequent to the registration of the documents, the Government came to know that the land values fixed in these cases are not genuine, since the District Level Committee was misled by a document, which was intentionally credited to boost the land value to get the exorbitant rates and was produced by the landowners for fixing the value of the lands. Hence, the Government had come to the conclusion that the transaction was not genuine. 14. Apart from this, the Government has also given some other reasons to reconvey the lands. The other reasons are only regarding the possession and the payment of registration fees. Now, the short question arises for consideration is as to whether the registered sale deed can be cancelled by way of an Executive Order. 15. 14. Apart from this, the Government has also given some other reasons to reconvey the lands. The other reasons are only regarding the possession and the payment of registration fees. Now, the short question arises for consideration is as to whether the registered sale deed can be cancelled by way of an Executive Order. 15. Before deciding this question, it is necessary to consider the plea of the petitioners herein on the ground of estoppel, relying upon the judgment of the Division Bench of this Court in the case of M.P.Abdul Hameed and Company v. Tamil Nadu Civil Supplies Corporation Ltd. M.P.Abdul Hameed and Company v. Tamil Nadu Civil Supplies Corporation Ltd. M.P.Abdul Hameed and Company v. Tamil Nadu Civil Supplies Corporation Ltd. [1997] 2 C.T.C. 357. Relying upon the said judgment, it was contended that the parties entered into agreement with open eyes are estopped from pleading that the agreement is unreasonable and arbitrary. 16. I am of the view that the principles laid down in the said case by the learned Division Bench cannot be made applicable to the facts of the present case. The transaction involved in the case relied upon by the petitioners is with regard to the hulling of the paddy and the storage of the rice in the godown. In the case on hand, it is with regard to the purchase of the land and as such, the plea of estoppel cannot be enforced, since, it is always open to both the parties to seek for setting aside the transaction on the ground of fraud. Hence, the plea of estoppel has no application to the facts of the present case. 17. On behalf of the petitioners, yet another judgment was also relied upon. It is also a judgment of the Division Bench of this Court in the cased of State of Tamil Nadu represented by its Joint Secretary, Department of Industries, Fort St.George, Madras v. The Bank of Madura Ltd., by its Chief Officer State of Tamil Nadu represented by its Joint Secretary, Department of Industries, Fort St.George, Madras v. The Bank of Madura Ltd., by its Chief Officer State of Tamil Nadu represented by its Joint Secretary, Department of Industries, Fort St.George, Madras v. The Bank of Madura Ltd., by its Chief Officer [1990] 2 L.W. 51. This judgment is also of no assistance to the petitioners for the same reasonings stated above. This judgment is also of no assistance to the petitioners for the same reasonings stated above. 18. Coming to the present question, there is no dispute that when once the sale deed was executed and registered, the transaction is completed. The purchaser had become the owner of the land irrespective of the payment of sale consideration. In a recent judgment in the case of Vidhyadar v. Mankik Rao and another Vidhyadar v. Mankik Rao and another Vidhyadar v. Mankik Rao and another [1999] 3 L.W. 576 the Apex Court, after referring to Sec.54 of the Transfer of Property Act, which defines the sale, has held as follows: “The definition indicates that in order to constitute a sale, there must be a transfer of ownership from one person to another, i.e., transfer of all rights and interests in the properties which are possessed by that person are transferred by him to another person. The transferor cannot retain any part of his interest or right in that property or else it would not be a sale. The definition further says that the transfer of ownership has to be for a ‘price paid or promised or part-paid and part-promised’. Price thus constitutes an essential ingredient of the transaction of sale. The words ‘price paid or promised or part-paid and part-promised’ indicate that actual payment of whole of the price at the time of the execution of sale deed is not a sine qua non to the completion of the sale. Even if the whole of the price is executed and thereafter registered, if the property is of the value of more than Rs.100 the sale would be complete”. There is a catena of decisions of various High Courts in which it has been held that even if the whole of the price is not paid, the transaction of sale will take effect and the title would pass under that transaction. To cite only a few, in Gyatri Prasad v. Board of Revenue and others 1973 All.L.J. 412 it was held that non-payment of a portion of the sale price would not effect validity of sale. It was observed that part payment of consideration by vendee itself proved the intention to pay the remaining amount of sale price. To the same effect is the decision of the Madhya Pradesh High Court in Sukaloo and another v. Pamau A.I.R. 1961 M.P. 176;I.L.R. 1960 M.P. 614. It was observed that part payment of consideration by vendee itself proved the intention to pay the remaining amount of sale price. To the same effect is the decision of the Madhya Pradesh High Court in Sukaloo and another v. Pamau A.I.R. 1961 M.P. 176;I.L.R. 1960 M.P. 614. 19. From the above principles, it is clear that irrespective of the non payment of consideration, the sale transaction is completed on the registration of the document. Moreover, it is clearly stated that the immovable property, the value of which is more than Rs.100, can be conveyed only by way of registered document. Hence, the impugned order cancelling the sale deed cannot be construed as a valid document. 20. Even though under the impugned order, the Government had expressed their willingness to execute the release deed in favour of the landowners, unless the registered sale deed is cancelled, there cannot be a valid release deeds. Instead of executing the release deeds, the Government can only cancel the registered sale deeds through the Court as stated in their notice dated 29. 1999. 21. In fact, I had an occasion to deal with the same question in W.P.Nos.2559 and 2560 of 1999. Of course, in the said case, the Government had not issued any Executive Orders. Before ever the issuance of such Executive Orders, the petitioners therein filed the said writ petitions for the issuance of a Writ of Mandamus directing the respondents therein to pay the balance of sale consideration, since 50% of the sale consideration had already been paid. I held that since the Government had come forward with a case of fraud, a writ of mandamus cannot be issued as prayed for and it is open to the Government to go before the civil court for cancellation of the sale deeds, as that is the only proper remedy available to them. While disposing of the said writ petitions, I had also permitted the petitioners therein to withdraw the balance of sale consideration on furnishing security, since, in that case, the balance of sale consideration was directed to be deposited in the court. In this case, that has not been done. While disposing of the said writ petitions, I had also permitted the petitioners therein to withdraw the balance of sale consideration on furnishing security, since, in that case, the balance of sale consideration was directed to be deposited in the court. In this case, that has not been done. It is agreed by all the parties that unless the sale deed is cancelled, the parties are bound by the same and on that basis, the learned counsel for the petitioners contended that the respondents should be directed to pay the sale consideration of the lands as agreed upon. 22. On the contrary, the learned Special Government Pleader contended that some time may be granted for the Government to go before the civil court for setting aside the sale deeds and till such time, the Government need not be insisted to pay the sale consideration, especially when, prima facie, there are materials to establish that the petitioners have committed fraud in the fixation of the price. .23. As already stated, it is the case of the Government that the transaction itself is not genuine, as the petitioners produced a document, which was intentionally created to claim the higher price than the market rate. When once the plea of fraud has been raised by the Government, definitely, it is a disputed question of fact, which has to be decided by letting in evidence. When a disputed question of fact arises, then, it can be decided after letting in evidence by both the parties. In such cases, it may not be possible for this Court to enter into an enquiry, as held by the recent decision of the Supreme Court in the case of Tamil Nadu Electricity Board v. Sumathi and others Tamil Nadu Electricity Board v. Sumathi and others Tamil Nadu Electricity Board v. Sumathi and others A.I.R. 200 S.C. 1603 wherein in paragraph 9, it has been held as follows: .“In view of the clear proposition of law laid by this Court in, A.I.R. 1999 S.C.W. 3383:A.I.R. 1999 S.C. 3412, when the disputed question of fact arises and there is a clear denial of any tortuous liability, remedy under Art.226 of the Constitution may not be proper.” .24. Whenthe question of fact cannot be decided where the relief of payment of sale consideration is sought for, in my view, it may not be possible to grant the relief of payment, because of the fact that larger interest has to be taken not of. If the Government is to file the suit for setting aside the sale deeds, and is directed to pay the sale consideration to the petitioners, the Government has to take possession of the lands and keep the same vacant till the proceedings are ultimately decided finally. On the other hand, if the Government is permitted to file a suit, and if the petitioners are directed to keep possession of the lands with them, they can be put to use for cultivation or for any other purpose they require. Further, the petitioners are not suffering any loss. Hence, at this stage, the payment of sale consideration cannot be considered. 25. It is further contended on behalf of the petitioners that the lands can be taken as security and the sale consideration can be directed to be paid. Here again, the trouble arises as to who is to keep the possession of the lands. If the petitioners have to keep the possession of the lands, they will be enjoying the same and at the same time, they have to be paid with the sale consideration. On the other hand, if the Government is to keep the lands, as already stated, the lands would be lying barren without any use and ultimately, they may become ‘no mans lands’. 26. Apart from this, when the land is not worthy of sale consideration mentioned in the sale deed, and when it is contended by the respondents that a fraud had been played by the petitioners in the determination of the sale consideration, I do not think it is proper to direct the Government to pay the sale consideration mentioned in the registered sale deed by keeping the property as security. Hence, on any angle, the relief of payment of sale consideration cannot be granted. 27. Hence, on any angle, the relief of payment of sale consideration cannot be granted. 27. It has been held in the case of Parambikulam A.P.O.A. Association and others v. State of Tamil Nadu and others Parambikulam A.P.O.A. Association and others v. State of Tamil Nadu and others Parambikulam A.P.O.A. Association and others v. State of Tamil Nadu and others [1999] 3 L.W. 591 that when once the registration is completed, the transaction is completed. If any one of the parties wants to set aside the transaction on the ground of fraud, they have to file a suit for the said relief, because evidence is required to prove the plea of fraud. It is not open to any one of the parties to the transaction to cancel the sale deed unilaterally on their volition. Hence, the proper remedy for the respondents is to file a civil suit for setting aside the sale and the impugned Government Order cannot be sustained. 28. Accordingly, the writ petitions are partly allowed setting aside the impugned order of cancellation of the sale deeds. So far as the relief for payment of sale consideration is concerned, the same is rejected. It is open to the petitioners to seek for appropriate interim relief as and when the respondents file the suit for setting aside the sale deeds. The respondents are hereby granted a months time to file the civil suit considering the fact that the sale deeds had been executed in the year 1996 and the impugned order has been passed in 1999 i.e., nearly an year ago. No costs. Consequently, all connected pending W.M.Ps. are dismissed.