A.S Khongphai v. The Special Judicial Officer, Shillong And Others

1. This is an application under Arts. 226/227 of the Constitution of India against an order dated 23-12-76 passed in L.A (Misc.) Case No. 16 of 1976 rejecting the petitioner's application under S. 33 of the Land Acquisition Act and directing the awarded amount to be deposited in the State Bank of India, Shillong branch in the name of the Collector under Fixed Deposit Scheme and holding that the Court had no jurisdiction, whatsoever, to decide the right, title and interest of the parties under the proceedings. It involves two questions, namely (1) Whether a reference Court has jurisdiction to decide the question of title and interest of the parties when a post award civil suit on the same subject-matter is pending in a civil Court? (2) Whether an application under Arts. 226/227 is maintainable?

2. A plot of land measuring 93 acres, more or less, situate at Spread Eagle Falls, Shillong was acquired under the Land Acquisition Act 1894 and an award was given by the Collector on 8-2-74. The petitioner and the respondent No. 4 were shown as persons interested in the land, but the entire balance amount of Rs. 23,71,097.60 P. was shown as payable to the petitioner Sri A.S Khongphai, and nothing payable to respondent No. 4. The petitioner earlier handed over possession of the land to the Defence Department and received an interim payment of Rs. 5 lakhs from the Collector on 14-2-70 pending finalisation of the award. The respondent No. 4 claiming compensation filed a petition dated 10-6-71 before the Collector who by his letter dated 20-8-71 directed her to establish her alleged right over the acquired land in a Court of Competent jurisdiction. She filed Title Suit No. 34(T) of 1971 for declaration of her right and title over the land in question and for injunction restraining the Collector from making payment of any compensation money under any award to the petitioner. The suit was dismissed on 15-9-72 on the ground that the suit having been between Tribals the Civil Court had no jurisdiction to entertain the same. An appeal therefrom also failed. Meanwhile the award was given on 8-2-74. A revision application in the Hon'ble High Court was also dismissed on 27-6-75, resulting in vacation of the injunction order granted on 13-9-73. Respondent No. 4 thereafter filed Title Suit No. 18(T) of 1975 impleading the petitioner as the principal defendant and the other defendants of the earlier suit were pro forma defendants and impleading four others, said to be the heirs of the one late R.E Haffield. An ad interim injunction granted on 4-7-75 was made absolute on 29-9-75. On appeal by the petitioner injunction was vacated on 23-2-76. Meanwhile the award being given, the petitioner filed an application under S. 18 of the Land Acquisition Act objecting to the quantum of compensation and upon this reference L.A (Misc.) Case No. 16 of 1976 was registered. Respondent No. 4 also filed a similar application objecting to entitlement, for determination of the person to whom the compensation was payable, and thereupon another reference case— Misc. No. 15 of 1976 was registered. Both the cases are now pending in the court of the Special Judicial Officer, Shillong.

3. After vacation of the injunction (on 23-2-76) the petitioner submitted an application before the Collector on 1-3-76 praying for payment of the compensation money to him; but the same was rejected on the ground that the payment could not be made at that stage, as the matter was pending in the Reference Court of the Special Judicial Officer, Shillong. The petitioner then filed another application dated 10-6-76 before the Special Judicial Officer, Shillong praying for release of the compensation money in his favour as he was entitled to receive it. The officer by his order dated 11-9-76, passed in L.A (Misc.) Case No. 16 of 1976, rejected the application on the ground that there was pending dispute between the petitioner and respondent No. 4 with regard to the right, title and interest of the land in Title Suit No. 18(T) of 1975 and that the court had no jurisdiction to hear a dispute regarding right, title and interest of the land under reference as the petitioner and respondent No. 4 were the claimants of the said amount Thereafter the petitioner filed another application, this time under S. 33 of the Land Acquisition Act in the same Court for release of the awarded money in his favour, taking into consideration the orders of the Hon'ble High Court and the Appellate Court vacating the order of temporary injunction, and praying, in the alternative, to deposit the balance amount of compensation money as per provisions of S. 33 of the Land Acquisition Act in Bank at Shillong in the name of the petitioner so that he may enjoy the interest accrued on the amount. The Court by the impugned order dated 23-12-76 treated the said application as a review application under O. 47, R. 1 of the C.P.C and rejected the same holding that there was nothing to review the earlier order dated 11-9-76 passed by him; and directing the balance amount of compensation money to be deposited in the State Bank at Shillong branch in the name of the Collector under “Fixed Deposit Scheme” under S. 33 of the Act and the accumulated interest to be paid to the person interested in due course. The Court observed that in view of the pending dispute if the amount was released as prayed, it would tantamount to a decision of the disputed right, title and interest between the parties which was not contemplated in law, as the Court had no jurisdiction whatsoever to decide those under the proceeding. Hence this application.

4. In the High Court one Ka Krik Sibon Kharkongor filed an application to be heard as an intervener. By order dated 15-11-78 that application was directed to be decided at the time of hearing of the main matter, making it clear that she would be heard only as an intervener. On 6-10-77 counsel for the petitioner prayed for time to file an application to convert the writ petition into a revision petition. After conversion application was filed by order dated 15-11-78 the same was directed to be decided at the time of hearing of the main matter itself.

Mr. A.M Majumdar for the respondents taking a preliminary objection to conversion of the writ application into a revision application under S. 115 of the C.P.C, submits that the conversion application dated 14-11-77 against the impugned order dated 23-12-76 was clearly barred, though the writ application which was filed on 12-11-77 would not be barred as a revision petition. It is further submitted that by converting the application the Court cannot convert itself from a writ court to a civil court, the two jurisdictions being entirely different. Even assuming that it could be converted, the new grounds added in the revision application having not been there in the writ application in any form, the fresh application will be barred by limitation, and without an application for condonation of delay, the conversion cannot be allowed.

6. Mr. A.K Sarma, the learned Government Advocate, Meghalaya, while adopting the contentions of Mr. Majumdar, adds that justice of the case does not necessitate any conversion inasmuch as the title to the compensation being pending in the civil court, the reference court rightly directed the amount to be deposited in the Bank and no injustice has been caused to any of the claimants. Section 141 of the Civil P.C makes the procedure provided in the Code in regard to suits applicable to miscellaneous proceedings in any court of civil jurisdiction. But the expression “proceeding” does not include any proceeding under Article 226 of the Constitution. Such an application being outside the purview of the C.P.C, counsel submits, this application cannot be converted. Mr. S.K Hom-Choudhury, learned counsel for the intervener also opposes the conversion tooth and nail and says that she was fraudulently kept in dark.

7. Mr. J.P Bhattacharjee, the learned counsel for the petitioner, answers that in view of the erroneous decision of the reference Court and its refusal to act under S. 33 of the Land Acquisition Act, an application under. Art. 226 or 227 is maintainable. There should also be no objection to conversion of the application into one under S. 115 of the C.P.C as the jurisdictions under that section and under Arts. 226/227 to the Constitution of India may be invoked in this case. As regards the grounds stated in the conversion application, Mr. Bhattacharjee submits that they were already there in the writ application and have been re-stated only to show that a revision application lies against the impugned order.

8. Since the earlier order of this Court was to decide the question of conversion at the time of hearing the main matter, I have decided to hear the main case on merit and to defer the decision on conversion at this stage. The learned counsel for all the parties have agreed; and the application is accordingly heard on merit.

9. While the petitioner's earlier application did not mention any provision of law, and was presumably under S. 32(1), admittedly his application No. 836/76 dated 11-8-76 was under S. 33 of the Land Acquisition Act, which provides:—

“When any money shall have been deposited in Court under this Act for any cause other than that mentioned in the last preceding section, the Court may, on the application of any party interested or claiming an interest in such money, order the same to be invested in such Government or other approved securities as it may think proper, and may direct the interest or other proceeds of any such investment to be accumulated and paid in such manner as it may consider will give the parties interested therein the same benefit therefrom as they might have had from the land in respect whereof such money shall have been deposited or as near thereto as may be.”

10. Admittedly, in the instant case the balance money of the award had been deposited in Court and because of injunction orders no decision could be taken as to the investment or disposal of the amount and payment of the interest thereon. The injunction having been vacated leaving the Court entirely free to take any decision in this regard, the petitioner's application under S. 33 was appropriate. Though there was an earlier application which could be under S. 32(1) and which was rejected, the same should not be res judicata in respect of this application inasmuch as the person interested has a right under S. 33 to receive the money or to get its benefit and also to receive the interest thereon. As was held in Mukunda v. State, AIR 1977 Cal 195, the order on the previous application under S. 31(1) did not stand as a bar to the grant of the prayer in the subsequent application as in the earlier order the prayer was rejected. It could not also be treated as a review application under Order 47, Rule 1, the same having not been made as such.

11. The application ought, therefore, to have been considered under the provisions of S. 33. This section envisages, the money and the interest or other proceeds of the investment separately. It undoubtedly enables the Court on the application of a party interested to order the money to be invested in such securities as it may think proper and to direct the interest or other proceeds of any such investment to be accumulated and paid in such manner as it may consider will give the parties interested therein the same benefit therefrom as they might have had from the land in respect whereof such money shall have been deposited. The use of the word “may” appears to indicate that a discretion has been vested in the Court either to pay the money to the person entitled or if he so desires to invest it. (AIR 1954 Punj 158). The idea appears to be, to put the parties interested in the same position as they would have been in respect of the land acquired, had it not been acquired by the State. Clearly, the balance money; that is, the corpus and the interest or other proceeds, that is, the usufruct are envisaged separately and there may not be any objection to the interest or usufruct being paid to the person who would have naturally enjoyed it, had not the land been acquired and taken possession of. Among other facts the person from whom the possession of the land was taken, may be a material consideration inasmuch as he would naturally have received the benefit out of the land under his possession. Such person may vary from time to time. The fact that the Court is to decide the dispute as to whom the compensation is payable, may not always disable it from giving the interest or the proceeds accumulated to the person who would have received the same if the land was not converted into money due to acquisition.

12. In the impugned order the learned Court observed that when there is a clear doubt regarding the right, title and interest in respect of the said land, under such circumstance the Court has no jurisdiction to release the disputed compensation money in favour of any of the parties under the proceeding and release to the petitioner was refused on that ground. The Court further observed that if the amount was released it would tantamount to deciding the right, title and interest between the parties which the Court could not do as it had no jurisdiction whatsoever to decide the right, title and interest of the parties under this proceeding, meaning thereby that it could be done in a civil suit. The Court expressed that the amount would be kept for an indefinite period as it was not known when the title suit would be disposed of. Admittedly, there is a title suit, being Title Suit No. 18(T) of 1975, between the parties pending in the Court of the Assistant to the Deputy Commissioner wherein the respondent No. 4 claimed her right, title and interest over the land under acquisition.

13. In making the above observations and acting accordingly the learned Court appears to have stayed the reference case until final decision of the Title Suit No. 18(T) of 1975. If a decision in the reference case has to wait until the title suit is decided, it shall have to wait until the dispute is finally decided in appeal. Naturally, that may take a long time during which the reference case shall have to be kept in abeyance. While acting under that proposition the learned Court did not properly appreciate the jurisdiction and functions of a reference Court under S. 18 or 31 of the Land Acquisition Act. The jurisdiction under the Act is a special one and is strictly limited by the terms of the sections. In a reference under Section 18 the jurisdiction arises when a specific objection has been taken to the Collector's award and it is confined to consideration of that objection. Once, therefore, it is ascertained that the only objection taken is to the amount of compensation, that alone is the matter referferred and the Court has no power to determine and consider anything beyond it. Similarly, when the objection taken is to the question of entitlement that alone is the matter referred and the Court has no power to determine and consider anything beyond it. Sec. 18 clearly specifies four different grounds of objection, namely, (1) to the measurement of the land; (2) to the amount of compensation; (3) to the persons to whom it is payable; and (4) to the apportionment. In the instant case the objection of the petitioner is to the quantum of compensation while that of respondent No. 4 to the person to whom it is payable. The Court's jurisdiction is restricted only to these two objections. (AIR 1930 PC 64) If the reference court determines these disputes including the dispute as to their title to the land between the parties claiming compensation, the matter will be res judicata and bind the parties in any later suit involving that issue (AIR 1939 PC 133). The reference Court has to decide the dispute referred to it in terms of the provisions of the Act; and it may amount to refusal to exercise jurisdiction if he refers the parties to a civil court and wait to take a decision until the dispute is decided by the Civil Court. As was held in AIR 1938 Mad 955—

“When rival claimants come before the Court on a reference under Section 31, Land Acquisition Act, the court has a duty to decide which of the two claimants is entitled to the money deposited in Court. The Act makes provision for securing of funds in cases where the persona entitled to the custody of them is incompetent to alienate them, but it does not, so far as I am aware, make any provision wherein the Court can say “Claimant A has a good case, claimant B also has a good case, I direct them to go to a Civil Court to establish their cases, but meanwhile I confirm the decision of the lower court in favour of claimant A.”

14. The court must decide the matter which is before it. Whenever a question of title arises between rival claimants, it must under the terms of the Act be decided in that case and cannot be made the subject-matter of a separate suit. It is well established that the decision on the reference under the Land Acquisition Act on a question of title operates as res judicata to bar persons who are parties to that decision from agitating their title in separate proceedings. (AIR 1970 Mys 81). Where a suit relating to title to acquired land and a petition disputing apportionment of the compensation between the same parties with common issues were disposed of by a common judgment, but two separate decrees and no appeal against the decree in suit was filed it was held that the decree in suit had become final and principles of res judicata bar an appeal from the decree in the petition.

15. Counsel for the respondents refer to Section 10 of the C.P.C which is applicable to suits. A reference proceeding under the Land Acquisition Act, strictly speaking, is not suit proceeding. Under S. 53 of the Land Acquisition Act; the provisions of the C.P.C apply to a Land Acquisition Proceeding save as they may be inconsistent with anything contained in the Act Ss. 18, 30, 31, 32 and 33 lay down their procedure to be followed and so the C.P.C is not applicable to that extent. In AIR 1924 Cal 757, it was held that the Court has an inherent power to postpone the hearing of a suit pending the decision of a selected action (Probate proceeding) and to make an order for stay of cross-suits on the ground of convenience. The inherent power is not to be arbitrarily or capriciously exercised, but for facilitating real and substantial justice. In AIR 1933 Cal 887, it was held that a reference court under Section 18 is a court of special and exclusive jurisdiction, and a court of ordinary civil jurisdiction trying an earlier title suit has no jurisdiction to stay a subsequently instituted reference. When both parties sought the Tribunal as the forum for the determination of the question, the civil court ceased to have any jurisdiction in the matter.

16. In the instant case the award was dated 8-2-74 and on objections to the same the Misc. Cases 15/76 and 16/76 were registered. The respondent No. 4's Original Suit No. 34(T) of 1971 failed and the Suit No. 18(T) of 1975 was instituted after the applications for reference were made. The parties, therefore, can be said to have selected the reference court as their forum for determination of their dispute and the ordinary civil court may even be said to have ceased jurisdiction of the dispute so referred. There again can be no justification for keeping the parties deprived of the money or interest lawfully payable to them for an uncertain period to be taken by the civil suit. If the court is sure that the suit is going to be finally decided shortly, it may, in an appropriate case, postpone its own hearing until then. In the instant case there was no such certainty and the Court's abnegation of jurisdiction was of uncertain duration.

17. In the light of the foregoing principles it is to be held that the learned Court while deferring the decision until finalisation of the title suit virtually refused to exercise jurisdiction according to law. The impugned order to that extent is liable to be set aside. The learned Court also failed to consider the application in the light of the provisions of Section 33 which envisages the corpus and the usufruct separately. It cannot be said that the interest or the proceeds of investment may not be paid to the person interested who would have naturally enjoyed the same, had he not been deprived of the land by acquisition. The learned court ordered that the amount be deposited under “Fixed Deposit Scheme” in the name of the Collector, if admissible by the Bank. Once the award as to the amount has become final, all questions as to fixation of compensation are then at an end; the duty of the Collector in case of dispute as to the relative rights of the persons entitled to the money is to place the money under the control of the Court, and the parties then can proceed to litigate in the ordinary way to deter mine what their right and title to the property may be. (AIR 1922 PC 80). The parties are under litigation before the reference court and the Collector's duty has ceased. Under such circumstances, depositing the money in the name of the Collector and consequent accrual and, accumulation of interest in his name may, without anything more, lead to complications. The Collector's name may be treated as symbolical without any right or liability fastened to him.

18. The next question is whether this Court should interfere in exercise of its powers under Art. 226 and/or 227 of the Constitution of India, and if not, whether the application should be converted to one under. S. 115 C.P.C

19. The impugned order indicates non-exercise of jurisdiction by the reference court on an erroneous assumption that it is to wait until the title suit is finally decided having no jurisdiction to decide the dispute itself. It has also not exercised its jurisdiction in conformity with the provisions of S. 33. If this impugned order is allowed to be cited as a precedent, it may disable courts from exercising its jurisdiction under the Act. In view of the above I think that this Court will be justified in quashing the impugned order in exercise of its power or superintendence under Art. 227 of the Constitution of India so that the reference court performs its duty according to law and does not keep such proceedings in abeyance under an erroneous view as regards its jurisdiction. In view of the decision, to interfere under Art. 227 of the Constitution, it is not necessary to decide the question of maintainability under Art. 226 or conversion of the application into one under S. 115 C.P.C

20. In the result, this application is allowed. The impugned order is quashed. The Rule is made absolute. The petitioner's application under S. 33 of the Land Acquisition Act is remanded to the Special Judicial Officer, Shillong to be disposed of according to law, taking into consideration the discussions hereinabove. Pending disposal of that application the Fixed Deposit, if already made in terms of the impugned order, shall continue. Thereafter it will abide the result of the application. Under the facts and circumstances of the case the parties shall bear their own costs.

Rule made absolute.