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Financial Commissioner (Taxation) Punjab And Others v. Harbhajan Singh .
Factual and Procedural Background
This appeal concerns the grant of 11 kanals 7 marlas of land in the revenue estate of Karbara, District Ludhiana. The respondent and his brother, both displaced persons, were originally entitled only to 7 kanals 15 marlas, which had been finally transferred to the brother by order dated 17-8-1966. In 1967, the respondent—allegedly in collusion with revenue officials—secured a mutation in his favour and sought assignment of the additional land under the Displaced Persons (Compensation and Rehabilitation) Act, 1954.
On 29-8-1969, Settlement Officer Mr J.S. Quami granted the respondent the assignment. When the fraud was detected, the same officer, now functioning as Chief Settlement Commissioner, cancelled his earlier order on 16-9-1971. The respondent filed a revision under Section 33 of the Act, but the Financial Commissioner (Taxation) upheld the cancellation on 25-11-1971.
The respondent’s writ petition was dismissed by a Single Judge of the High Court, but a Division Bench allowed the respondent’s Letters Patent Appeal (LPA No. 526 of 1982) on 12-1-1989, holding that Mr Quami had lacked jurisdiction to sit in appeal over his own order. The present appeal challenges that Division Bench judgment.
Legal Issues Presented
- Whether the Financial Commissioner (Taxation), acting as delegate of the Central Government under Section 33 of the Displaced Persons (Compensation and Rehabilitation) Act, 1954, could revise and set aside the assignment order passed by the Settlement Officer.
- Whether the High Court’s Division Bench erred in quashing the Financial Commissioner’s revisional order merely because the same officer had previously acted without jurisdiction while cancelling his own order.
Arguments of the Parties
Respondent's Arguments
- Mr J.S. Quami, having granted the assignment as Settlement Officer, had no jurisdiction to cancel his own order while functioning as Chief Settlement Commissioner; therefore, the cancellation was void.
Appellant's Arguments
- Irrespective of any defect in Mr Quami’s cancellation order, the Financial Commissioner possessed independent revisional jurisdiction under Section 33 to correct fraudulent assignments, and had rightly upheld the cancellation.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Gulab Ajwani v. Saraswati Bai (1977) 3 SCC 581 | An authority cannot sit in appeal or revision over its own order. | Acknowledged that Mr J.S. Quami could not lawfully review his own assignment order, but distinguished the point by holding that the Financial Commissioner’s independent revisional power under Section 33 cured the defect. |
Court's Reasoning and Analysis
The Supreme Court began by reproducing Section 33 of the Displaced Persons (Compensation and Rehabilitation) Act, 1954, which empowers the Central Government—or its delegate—to call for the record of any proceeding and pass appropriate orders. The Court held that the Financial Commissioner (Taxation) was a duly authorised delegate and could therefore revise any order that was inconsistent with the Act or its rules.
While the Court agreed that Mr J.S. Quami’s act of cancelling his own order was legally untenable (as established in Gulab Ajwani), it emphasised that this defect did not exhaust the matter. All subordinate authorities had concurrently found that the respondent procured the assignment through fraud and collusion with revenue officials. Consequently, the Financial Commissioner was competent to correct the illegality suo motu or upon a revision filed by an affected party.
Because the Financial Commissioner’s revisional order relied on Section 33 rather than on Mr Quami’s defective self-review, the Division Bench erred in setting it aside. The Supreme Court therefore reinstated the Financial Commissioner’s order and the Single Judge’s dismissal of the writ petition.
Holding and Implications
APPEAL ALLOWED. The Division Bench judgment dated 12-1-1989 is set aside; the orders of the Single Judge and of the revenue authorities, including the Financial Commissioner’s order dated 25-11-1971, are restored. No costs.
Implications: The respondent’s fraudulent assignment of additional land stands cancelled, and the land reverts to the State/appropriate authorities. The decision affirms the broad revisional powers of delegates of the Central Government under Section 33 of the Displaced Persons (Compensation and Rehabilitation) Act, 1954, without creating new precedent beyond reaffirming existing principles.
Order
1. Leave granted.
2. We have heard learned counsel on both the sides.
3. This appeal relates to grant of 11 kanals 7 marlas of land in revenue estate of Karbara in Ludhiana District. The respondent and his brother Jawahar Singh s/o Gurdit Singh being displaced persons, his bother had applied for transfer of 7 kanals 15 marlas. It was accordingly granted to him and it became final by proceedings dated 17-8-1966. Thereafter, in the collusion with the revenue officials the respondent got his name mutated in the records with regard to the land in the year 1967 and asked for assignment of the same under the Displaced Persons (Compensation and Rehabilitation) Act, 1954 (for short, ‘the Act’). One Mr J.S Quami, Settlement Officer granted assignment to the respondent on 29-8-1969. Thereafter, when it was noticed that the mutation was obtained by playing fraud, the self-same officer as Settlement Commissioner, by proceedings dated 16-9-1971, set aside the order. It came to be challenged by filing of a revision under Section 33 of the Act. The Financial Commissioner (Taxation), Government of Punjab upheld the cancellation by his proceedings dated 25-11-1971. When the respondent filed the writ petition, the learned Single Judge by order dated 12-1-1989, dismissed the writ petition. The Division Bench by judgment and order dated 12-1-1989 in LPA No. 526 of 1982 has set aside the order on the finding that J.S Quami having exercised the power as Settlement Officer has no jurisdiction to sit over the same order as appellate authority as Chief Settlement Commissioner. Therefore, the order is vitiated by error of law.
4. The question is: whether the order passed by J.S Quami as Settlement Officer could be corrected by the Financial Commissioner (Taxation) under Section 33 of the Act? Section 33 reads as under:
“33. The Central Government may at any time call for the record of any proceeding under this Act and may pass such order in relation thereto as in its opinion the circumstances of the case require and as is not inconsistent with any of the provisions contained in this Act or the rules made thereunder.”
5. A reading thereof would clearly indicate that the Financial Commissioner (Taxation) as a delegate of the Central Government has power to revise any order after calling for record in relation thereto and if in his opinion the circumstances of the case require and the order passed is not inconsistent with the provisions of the Act and the rules made thereunder, he has got power to correct the same. It is true, as rightly contended by the learned counsel for the respondent, that J.S Quami having granted assignment as Settlement Officer, could not sit over his order as Chief Settlement Commissioner. This is the settled legal position and needs no reiteration. This Court in Gulab Ajwani v. Saraswati Bai (1977) 3 SCC 581 had laid the law. But the question is not resolved with the above finding alone. As stated earlier, the Financial Commissioner (Taxation) as a delegate of the Central Government has been invested with the power under Section 33 to revise any orders. All the authorities have held that after his brother Jawahar Singh had been granted the same assignment as granted to them, the respondent in collusion with lower level revenue officials had played fraud and obtained another assignment. The Commissioner under Section 33, therefore, has power to correct the same in his revisional jurisdiction though it was brought to his notice by way of revision by the respondent himself treating it to be a suo motu review. Under these circumstances, the High Court was not justified in quashing the orders.
6. The appeal is accordingly allowed. The order of the Division Bench is set aside and that of the Single Judge and the authorities upheld. No costs.
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