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  • Sections 90 and 91 of the Land Revenue Act
  • Land Revenue Act, the provisions of S. 90
  • SECTION 5 REVENUE RECOVERY ACT
  • Section 90 of the Land Revenue Act,
  • Section 5 of the Bombay Act.
  • S. 5. Revenue Recovery Act,
  • Land Revenue Act
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Citation Codes
Equivalent Citations
citation codes
Case Number
Advocates
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Acts
  • Sections 90 and 91 of the Land Revenue Act
  • Land Revenue Act, the provisions of S. 90
  • SECTION 5 REVENUE RECOVERY ACT
  • Section 90 of the Land Revenue Act,
  • Section 5 of the Bombay Act.
  • S. 5. Revenue Recovery Act,
  • Land Revenue Act
Smart Summary

Structured Summary of the Provided Opinion

Factual and Procedural Background

The petitioners entered into a contract with respondent No. 3 on 2-4-1956 for cutting and carriage of grass from Rakh Hari Bathi (State land) for the period May to October 1956. Under the contract the petitioners agreed to supply the grass within the time fixed, accepted liability to a contractual penalty for breach, and consented that such penalty might be realised as an arrear of land revenue under the machinery of the Land Revenue Act.

The petitioners failed to supply the grass as stipulated. The respondents proceeded to realise a penalty of Rs. 27,962/2/- as arrears of land revenue. Prior to recovery, the respondents sent a notice demanding the dues; the petitioners sought intervention from the State Government and initially obtained a stay, but the Government ultimately rejected their representation. The petitioners approached this Court by way of a writ of mandamus to restrain the respondents from realising the sum.

The matter was heard first by a Single Judge and then placed before the Division Bench for authoritative decision because a point of law was involved.

Legal Issues Presented

  1. Whether the recovery of the contractual penalty as an arrear of land revenue was contrary to the rules of natural justice because the petitioners were not given an opportunity to show cause.
  2. Whether the Land Revenue Act (specifically Sections 90 and 91) permits recovery of the contractual penalty as an arrear of land revenue—i.e., whether a sum arising under contract can be made "lawfully recoverable as an arrear of land revenue".
  3. Whether a writ of mandamus can be issued to restrain enforcement of a contract (or its enforcement as arrears of land revenue) on the ground that the contract is void, illegal, or that the respondents have breached a statutory duty in using the Land Revenue Act machinery.
  4. Whether the penalty falls within the categories enumerated in Section 91 (in particular clause (b)) so as to be recoverable as arrears of land revenue.

Arguments of the Parties

Petitioners' / Mr. Dhar's Arguments

  • The order realising the amount is hit by the principles of natural justice because the petitioners were not given an opportunity to show cause before the amount was recovered.
  • There is no provision in the Land Revenue Act to recover the particular sum alleged as an arrear of land revenue; therefore, the respondents' action amounted to a breach of statutory duty and the contract provision enabling recovery as arrears was void.
  • Because the Land Revenue Act does not, in terms, apply to the dues claimed, the contractual clause making the penalty recoverable as arrears of land revenue is void; accordingly, enforcement by revenue machinery should be restrained.
  • Implicitly, the petitioners suggested the contract might be contrary to public policy or otherwise unenforceable by revenue recovery machinery.

Respondents' / Advocate-General's Arguments

  • The respondents had given notice and the petitioners had an opportunity to be heard; petitioners had also applied to and been considered by the State Government which rejected their representation.
  • The petitioners had freely agreed in the contract that a penalty could be realised as an arrear of land revenue; they were aware of the consequences of breach and in fact breached the contract.
  • The Advocate-General contended (though the Court found it unnecessary to decide) that the penalty would fall within clause (b) of Section 91 as a revenue due to the Government on account of natural products of the land.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Bank of India v. John Bowman, AIR 1955 Bom 305 Established that a right to recover a sum may arise out of contract as well as statute; an amount arising from contract can be treated as "recoverable" under the revenue recovery provisions (Section 5 of the Revenue Recovery Act in that context). The Court relied on the reasoning in this decision to support the proposition that where parties agree that a sum is to be realised as an arrear through revenue recovery machinery, such an agreement can render the sum "lawfully recoverable as arrears of land revenue" under Section 90.
Bhagwandass Narottam v. State of Bombay, OCJ App. No. 37 of 1954 (Bom), Dated 7-4-1954 The Bombay Bench had held that the term "recoverable" in the relevant revenue recovery provision is not confined to statutory rights and can include rights arising out of contract. The Court treated this authority (as considered in the Bank of India decision) as supporting a broad interpretation that contractual obligations can be made recoverable by the State through the specified revenue recovery machinery, thereby informing the present Court's reading of Sections 90 and 91.

Court's Reasoning and Analysis

The Court proceeded by addressing the petitioners' contentions in sequence and applying the text of Sections 90 and 91 of the Land Revenue Act together with the principles in the cited precedents.

  1. Natural justice claim: The Court rejected the contention that the petitioners were denied an opportunity to be heard. The admitted facts showed that a notice was sent before recovery steps were taken, the petitioners had an opportunity to show cause, and they had pursued and been heard by the Government (which ultimately rejected their representation). The petitioners had full knowledge of the contractual penalty and the consequences of breach; the penalty imposed was less than the contractually stipulated maximum.
  2. Scope of Sections 90 and 91: Section 90 allows use of the revenue recovery machinery when a sum of money is "lawfully recoverable as an arrear of land revenue." The petitioners argued that the penalty is not per se an arrear of land revenue. The Court emphasized the qualifying phrase "lawfully recoverable as arrears of land revenue" and observed that if parties, with full knowledge, agree that a sum be realised through the Land Revenue Act machinery, then by virtue of that agreement the sum becomes lawfully recoverable as an arrear of land revenue under Section 90.
  3. Contractual enforcement and mandamus: The Court held that a writ of mandamus is not the appropriate remedy to restrain a party from enforcing a contract, even if the contract might be challenged as illegal — the validity of a contract is a matter for a properly constituted suit rather than a writ of mandamus. Allowing the petitioners to obtain such relief would permit them to take advantage of their own wrong, which the Court declined to do. The Court further noted that parties sui juris may agree upon a mode of recovery for debts (so long as not contrary to public policy).
  4. Interaction of S.90 and S.91: The Court found that once, by agreement, a sum becomes lawfully recoverable under Section 90, Section 91's list of additional sums recoverable as arrears applies to such sums. Thus, the petitioners' argument that recovery must strictly fall within the enumerated categories of S.91 before Section 90 could operate was rejected: the opening words of S.91 ("In addition to any sums recoverable as arrears of land revenue under this Act...") presuppose sums already lawfully recoverable under S.90.
  5. Precedent support: The Court relied on the Bombay High Court authorities (Bank of India and Bhagwandass Narottam) which had interpreted similar provisions to permit recovery of sums arising from contract by the revenue recovery machinery. The Court found the substance of the Acts comparable and the precedents persuasive.
  6. Unnecessary rulings: Although the Advocate-General argued the penalty would fall within clause (b) of S.91 as revenue due on account of natural products, the Court stated that it was unnecessary to decide that point because its conclusion on the contractual effect under Section 90 made such determination redundant.

Holding and Implications

Holding: Application dismissed.

Direct consequence for the parties: The petition for a writ of mandamus restraining the respondents from realising Rs. 27,962/2/- as arrears of land revenue was dismissed. The petitioners were ordered to pay costs of Rs. 100 to the respondents.

Broader implications: The Court's decision rests on the principle that where the parties, with full knowledge, agree that a contractual sum may be realised through the Land Revenue Act machinery, that agreement can render the sum lawfully recoverable as an arrear of land revenue under Section 90; accordingly, the use of revenue recovery procedures in such a case does not, by itself, constitute a breach of statutory duty warranting mandamus. The opinion applied and followed existing Bombay High Court authorities on the point; it did not purport to set out a novel or separate precedent beyond applying the cited authorities to the facts.

Disposition

The application for a writ of mandamus was dismissed by the Division Bench. Judge K.V. Gopalakrishnan Nair agreed. Costs were assessed at Rs. 100 in favour of the respondents.

This summary is strictly constrained to the matters expressly stated in the provided opinion and does not infer facts or legal holdings beyond that text.

    Ahmad Rathar v. Tehsildar Khas

    Murtaza Fazl Ali, J.:— This is an application for a writ of mandamus restraining the respondents from realising a sum of Rs. 27962/2/- as arrears of land revenue.

    2. The petition was heard in the first instance by a single Judge of this Court and as a point of law was involved in this writ, it has been laid before us, for an authoritative decision. The petition arises in the following circumstances: The petitioners entered into a contract with respondent No. 3 on 2-4-56 for cutting and carriage of grass from Rakh Hari Bathi (belonging to the State), for a period from May to October, 1956. Under the contract the petitioners agreed to supply the grass concerned within the time fixed in the contract, and they further agreed to make themselves liable to a penalty on a breach of the terms of the contract and they also consented that such a penalty may he realised as an arrear of land revenue, under the machinery provided in the Land Revenue Act.

    3. The petitioners, however, failed to supply the grass as stipulated and accordingly the respondents proceeded to realise the penalty as arrears of land revenue. It appears that before taking this step, the respondents wrote a letter to the petitioners demanding the dues which were to be realised from them. The petitioners then moved the Government and obtained an order of stay from the Government but eventually the Government rejected their representation. The petitioners have, therefore, come up to this Court for a direction restraining the respondents from realising the amounts mentioned above.

    4. In support of the rule, Mr. Dhar contended in the first place that the order realising the amount from the petitioners is clearly hit by the principle of natural justice as the petitioners were not given any opportunity to show cause against this order. In our opinion, this contention does not seem to be well founded. It appears from the admitted facts that a notice was sent to the petitioners before taking steps for realising the amount and the petitioners had ample opportunity to show cause against the said order of the respondents.

    5. In fact the petitioners did move the State Government against this order, but the Government rejected their representation. Apart from this, the petitioners were fully aware under the terms of the contract that if they fail to supply the grass within the time fixed in the contract, they were liable to a penally at the rate provided in the contract. The penalty imposed on the petitioners is in fact less than the maximum rate provided in the contract.

    6. The petitioners therefore were fully aware that they had in fact committed a breach of contract and that they were, therefore, liable to a penalty under the terms of the contract to which they had agreed. Moreover, as found above, the materials on the record clearly show that the order for recovery of the alleged amount from the petitioners was passed after giving a complete opportunity to the petitioners of being heard in the matter. This contention, therefore, must be overruled.

    7. Mr. Dhar then contended that as there was no provision in the Land Revenue Act to recover the amount alleged by way of arrears of revenue, the action of the respondents in recovering the amount in this manner, amounted to a breach of statutory duty so as to enable this Court to issue a writ of mandamus. Mr. Dhar further contended that although the petitioners had agreed in the contract that the penalty could be realised as arrears of revenue, yet as the Land Revenue Act did not apply in terms to dues claimed by the respondents, the contract was void and the respondents should, therefore, be restrained from enforcing the terms of the contract.

    8. I have given my anxious consideration to this contention, and in my opinion, this contention is absolutely devoid of any substance. It is well settled that a writ of mandamus cannot lie to restrain a party from enforcing a contract even if the contract be an illegal one. Whether a contract is void or unenforceable is really a matter to be decided in a properly constituted suit and not in a writ of mandamus. Moreover, the petitioners had entered into the contract with open eyes and after full knowledge of the consequences and they cannot now turn round and ask this court for a declaration that the contract is void, for this would really amount to allowing the petitioners to take advantage of their own wrong, and it is also well settled that a writ of mandamus can only lie when the ends of justice so require. Finally, we are of the opinion, that the contract is not illegal or void at all. In this connection, our attention has been drawn to Sections 90 and 91 of the Land Revenue Act which runs as follows:

    “An officer whose duty it is under any law or rule having the force of law to realise a sum of money and the same is lawfully recoverable as an arrear of land revenue may request an Assistant Collector of the First Class under whose jurisdiction the person from whom it is recoverable resides or holds any property to realise the same as arrear of land revenue. With such request such officer shall forward to the Assistant Collector a certificate showing the correct amount due upto the date of such certificate.

    Provided that no arrears which are more than three years old shall be realised summarily under this section.

    The person from whom the money is so recovered may, if he denies his liability, sue the Government to recover the same”.

    “In addition to any sum recoverable as arrears of land revenue, under this Act, or any other enactment for the time being in force, the following sums may be so recovered namely:

    (a) Fees, fines, costs, and other charges including rates of cesses payable under this Act:

    (b) revenue due to the Government on account of pasture or other natural products of land, or on account of mills, fisheries or natural products of water or on account of other rights described in S. 35 or S. 39 in cases in which the revenue so due has not been included in the assessment of an estate.

    (c) Sums leviable by or under the authority of the Government (xxx) (sic) as water rates, or on account of the maintenance or management of canals, embankments or other irrigation works, not being sums recoverable as arrears of land revenue under any enactment for the time (sic) in force,

    (cc) Sums granted on loan by the Government for advanced studies or for undergoing advanced or specially (sic) training in India or abroad.

    (ccc) Loan advanced by the Government to a person who has suffered on account of fire, flood, earthquake or a calamity of like nature.

    (cccc) Sums advanced in pursuance of Cabinet order No. 1547-C of 1953 dated 15th December, 1953 as loan by the Government to craftsmen, artisans, and petty traders with a view to their rehabilitation in such craft, art or trade.

    (d) Sums payable to the Government (xxx) by a person who is surety for the payment of any of the foregoing sums or of any other sums recoverable as an arrear of land revenue.

    (e) With the previous sanction of the Government, sums due to the postal Department, the Dharmarth Department.

    (f) Sums recoverable by Government as arrears of customs import and export duties, and

    (g) Sums due to the Agricultural Department on account of produce of agricultural crops including fruits, contracts or supply of chemical fertilisers.”

    9. An analysis of S. 90 would show that in order to resort to the machinery provided under this section, the sum of money should be lawfully recoverable as arrears of land revenue. The contention is that the penalty imposed by tile respondents is not per se arrears of land revenue as envisaged in the Land Revenue Act. In our opinion, however, the matter does not rest here. The words used in this section are not merely “an arrear of land revenue” but “lawfully recoverable as arrears of land revenue.”……..Under these circumstances, if a party which is fully conscious of its rights agrees, that certain sum of money should be realised through the machinery provided in the Land Revenue Act, and as arrear of land revenue, we do not see how the contract will become void on that account.

    10. It is always open to a party to agree as to how the rights under a contract may be effectually settled. The petitioners having agreed that instead of taking recourse to the ordinary procedure of the Civil Courts, the mode of realisation should be one provided under the Land Revenue Act, the provisions of S. 90 at once come into play and by virtue of such an agreement the sum of money becomes lawfully recoverable as arrears of land revenue. Almost precisely a similar question was canvassed before a Division Bench of the Bombay High Court in case Bank of India v. John Bowman, (S) AIR 1955 Bom 305, and their Lordships were pleased to make the following observations:

    “But the question that we have to address ourselves to is whether the right to recover any sum by the State is confined to a right arising out of a statute or whether Section 5 of the Revenue Recovery Act, also contemplates a right arising out of contract. We considered this very question in Bhagwandass Narottam v. State of Bombay, OCJ App. No. 37 of 1954, D/- 7-4-1954 (Bom), and we came to the conclusion that there was no reason why we should give a narrow restricted interpretation to the expression “recoverable” used by the Legislature in S. 5 and our view was that whether the right to recover a sum arose out of statute or out of contract, S. 5 was equally applicable. Adhering to that view it follows that the State had the right to recover the amount due from the respondent 3 under a contract and by reason of that right a certain sum became recoverable within the meaning of S. 5. Revenue Recovery Act, and if that sum became recoverable by any public officer — in this case it was Mr. David — then the Collector of Bombay on the request of that Public Officer was given the power to proceed to recover that sum as if it were an arrear of land revenue.”

    11. It may be noticed that, in that case their Lordships of the Bombay High Court were interpreting the effect of words “recoverable” which also appeared in Section 5 of the Bombay Act. In that case also the argument was that a contract of this kind really amounted to legislation by the parties by means of a contract, but this argument was repelled by their Lordships with the following observations:

    “What according to Mr. Seervai, the State and respondent 3 have done by this contract is to override the provisions of the Code of Civil Procedure and to substitute for the provisions of the Code, a special law, as it were, dealing with their own contractual rights and liabilities. The answer to that contention, in our opinion, is simple. Parties who are “sui juris” can enter into any contract provided that it is not opposed to public policy, and we see no reason why it was not open to respondent 3 to agree with the State of Bombay that his debt should be recovered by a particular mode. We are now only dealing with this contract so far only as it affects the rights of a debtor. A coercive machinery was available to the State and the debtor agreed that the machinery should be availed of by the State having to recover its debt by the long and dilatory process of going to a civil court. Therefore, to the extent that it did not affect the rights of the Bank there seems to be no reasons whatsoever why we should take the view that the State and respondent 3 were not competent to enter into a contract of this nature.”

    12. Mr. Dhar seems to suggest in his argument that the contract is against public policy, but we do not find any material to support this contention. The contract in the present case does not contravene any specific provision of the statute nor it can be said that the contract is immoral. The counsel, therefore, has not been able to show that the contract is per se void, merely because the parties have agreed that the mode of realisation of penalty should be by virtue of the machinery provided by the Land Revenue Act instead of by the long drawn process of the civil courts.

    13. Again counsel for the petitioners tried to distinguish the case referred to above on the ground that the Bombay Act contained different provisions. We are, however, unable to agree with this contention because the substance of both the Acts so far as the mode of recovery is concerned is the same. Moreover, if the contract between the petitioner and the State is a valid one, then even in terms of S. 90 the penalty imposed on the petitioners becomes a sum of money which is lawfully recoverable as arrears of land revenue. Mr. Dhar then contended that S. 90 is really controlled by S. 91 and unless the penalty imposed in this case comes within the categories laid down in cls. (a to g) of S. 91, it cannot be deemed to be arrears of land revenue as envisaged in the Act. The opening words of S. 91 are itself:

    “In addition to any sums recoverable as arrears of land revenue under this Act………….”

    14. These words clearly refer to a sum which is lawfully recoverable as arrears of land revenue under S. 90. Once it is held that by virtue of the agreement the penalty imposed was lawfully recoverable under Section 90 of the Land Revenue Act, there can be absolutely no difficulty in holding that S. 91 would in terms apply to such a sum of money. The contention of Mr. Dhar, on this score, is therefore, overruled.

    15. The Advocate-General, however, contended that the penalty imposed would certainly come within cl. (b) of S. 91 as it would amount to a revenue due to the Government on account of natural products of the land. In the view that we have taken above, it is not necessary for us to go into this aspect of the matter. The position, therefore, comes to this: that in the first place by virtue of the terms of the contract the amount sought to be recovered from the petitioners becomes on amount lawfully recoverable as arrears of land revenue within the meaning of Section 90 of the Land Revenue Act and consequently there is no breach of any statutory duty by the respondents so as to warrant a writ of mandamus. Secondly, we do not see how a writ of mandamus can lie to restrain the respondents from enforcing a contractual obligation to which the petitioners themselves had agreed with open eyes and with full knowledge.

    16. For the reasons given above, we are of the opinion, that the petitioners have not been able to make out a case for writ of mandamus. The application is, therefore dismissed with costs assessed at Rs. 100/- to be paid by the petitioners to the respondents.

    17. K.V Gopalakrishnan Nair, J.:— I agree.

    KD/D.H.Z

    18. Application dismissed.

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    Ahmad Rathar v. Tehsildar Khas
    (Oct 22, 1960)