The Judgment of the Court was delivered by
Kalyan Jyoti Sengupta, J.:— By this application, the petitioners through their constituted Attorney have asked for setting aside of the order for sale of various properties passed in the testamentary proceedings. Before addressing to the issues the facts of this case are required to be stated briefly.
2. One Surendra Nath Banerjee since deceased is said to have died leaving behind will bequeathing his all properties in accordance with the direction and stipulation given therein. In the will it is said that Sudhir Kumar Banerjee, since deceased was appointed Executor. This man had four sons and six daughters. The present petitioners are the sons of his second son, Salil Kumar Banerjee since deceased. Suren was survived by his wife Sarala Bala Devi, since deceased. Thereafter it is said that this old man married second time, however, factum of which is disputed. One of the daughters of the subsequent marriage has come forward in this proceeding to claim her share. Sudhir, since deceased, during his lifetime applied for grant of probate of father's will. However, the probate was refused by this Court, as it was seriously challenged and such challenge succeeded. An appeal was preferred against the order, refusing grant of probate. The appeal was kept pending and during pendency of the appeal the above named executor died.
3. In the pending appeal the sons and daughters of the old man tried to compromise amongst themselves by filing an agreement in the probate proceedings before the appeal Court. The appeal court had accepted the compromise amongst the heirs and heiress and the legal representative of the old man. Ultimately, on application being made by the present petitioners, who are the sons of Salil Kumar Banerjee, since deceased the said consent order was set aside by the appeal court and it declared the appeal stood abated so it was dismissed. As a result the properties of the old mand were succeeded by the heirs and legal representatives on death intestacy.
4. Sudhir was a bachelor and during pendency of the probate proceedings in relation to his father's will he is said to have executed a will bequeathing all his properties, that has come to his hand. The application for grant of probate of Sudhir's will was also challenged. In this will Sunil was appointed executor and also the legatee, so the other brothers and sisters came forward to challenge the grant. The probate was granted once, however, subsequently it was revoked. Later, the contesting parties thought fit to bury the hatchet by entering into a compromise and this compromise is under challenge in this application. Factually all the contesting parties to the probate proceedings signed the agreement but the present petitioners being the nephews of Sudhir did not signify their consent.
5. Ordinarily, these first two petitioners would not have locus standi to challenge the grant of probate to the will of their uncle, because these persons cannot in case of death intestacy, succeed by reason of the fact that they are the sons of predeceased brother of the testator, Salil, under the provision of Section 8 of Hindu Succession Act of 1956, read with the schedule thereto. It appears that the compromise was arrived at by all the parties excluding the present petitioners covering all the assets and properties, which have come down from the common origin, namely, father Suren.
6. By the order a large number of properties are directed to be sold and from the affidavit of assets filed in this probate proceedings it appears Sudhir did not have any exclusive and individual right title and/or interest in any of the properties mentioned in the consent order, excepting his undivided share. These petitioners are certainly affected by the impugned order, so far as the same relate to interest in undivided properties.
7. On dismissal of the appeal in relation to the probate proceedings of Suren's will undivided interest has certainly had devolved unto their deceased father, Salil. Salil is alleged to have converted into Christianity during lifetime of Surendra. During pendency of probate proceedings in relation to Suren's will Salil died. Therefore, on death of Surendra Nath Banerjee and subsequent dismissal of probate proceedings Salil had succeeded the property along with other heirs and legal representatives.
8. This matter has to be dealt with property wise, as, if it is found that Sudhir had left behind any of his exclusive property, then, these petitioners cannot question to that extent of the impugned consent order.
9. On the aforesaid background now rival contention of the parties has to be examined. The properties mentioned in the consent order consist of as follows:
(i) Premises No. 40B and 42 Protapadittya Road, Calcutta.
(ii) Premises being No. P-64 (Holding No. 415/120), Block - E, Bangur Avenue, Calcutta.
(iii) Premises No. 11/2, Ultadanga Road, Calcutta.
(iv) Thika tenanted structure at 118, Raja Dinenda Street,
(v) Two Calcutta Stock Exchange Cards.
10. Mr. Pratap Chatterjee learned Senior Counsel submits that the aforesaid consent order has been obtained by practicing fraud of a highest degree, because all the parties to the said proceedings have suppressed relevant feet that his clients are also entitled to-inherit the property. Sudhir did not have any property of his own, all that he had is, undivided right, title and interest in father's property. The impression was given to the Court as if Sudhir had all the aforesaid properties of his own in the probate proceedings in relation to his will. The assets and properties of Surendra could not be brought but it was done wrongfully. He submits further that apart order of sale was procured by suppression of subsisting order of injunction passed by the learned Court of Junior Division, Sealdah in the suit filed by executor trustee of their father's will, which has since been probated. Moreover, the order of the appeal court was also not placed and this order of appeal court prohibited the parties from executing any conveyance in relation to the Bangur Avenue property. Therefore, he submits, apart from his clients having not signified consent to this order the sale order was passed in complete breach of order of injunction.
11. As far as the Pratapaditya Road property is concerned he submits that this property belonged to mother Sarala Bala, even though there is no document to show the property was acquired by mother Sarala Bala, rather from the act and conduct of the parties it will appear the property was not owned by her.
12. Mr. Chatterjee contends that even assuming this property belonged to Sarala Bala, still then his clients are entitled to inherit their father's share, applying the rule of ordinary succession in relation to women's property, notwithstanding death of Sarala Bala in the year 1946. The law of succession prior to 1956, of women's property, which is Ayautaka, is not different from the present law of succession. He has drawn my attention to Article 157 of Mullah's Hindu Law and submits that the Stridhana arising out of Ayautuk property will devolve on the death of women, upon amongst others sons along with the daughters.
13. Nothing has been produced to show that the said property was acquired by Sarala Bala as Yautaka. In absence of such evidence this property can be termed to be ‘Ayautaka’, struidhana. As such succession will be in accordance with Article 157 of the Hindu Law (Mullah).
14. Admittedly the mother had died before Salil died. So, 1/10th share of the said property had devoled upon Salil during his lifetime. Therefore, automatically the petitioners have their 1/20th share each.
15. So far as the other properties are concerned nothing has been produced to show that Sudhir or for that matter Sunil or shyamal had exclusive right in the property. In the affidavit of assets filed in the probate proceedings of the alleged will of Surendra all the assets are included showing that the said properties belonged to said deceased father. Those facts were not placed before this Court at the time of passing of the order of sale in a probate proceeding, admittedly and the petitioners are not signatories to the same.
16. Mr. Kar appearing for the purchaser of Pratapaditya Road property submits that Mr. Chatterjee's clients have no right, title and interest in this property as this property is stridhana, as being yautaka and succession will be applicable in accordance with Article 155 of the principle of Hindu Law (Mullah). It will appear from the aforesaid Article sons are excluded only daughters (both betrothed and un-betrothed and married and un-married) are eligible. On the death of Sarala Bala both married and un-married daughters were there. Therefore, by no stretch of imagination the grand son of Sarala Bala can get any share in the Pratapaditya Road property. As such the petitioners have no locus standi to question the order of sale of this property. Even assuming the petitioners have interest the entire sale cannot be said to be invalid and void by reason of the fact that the petitioners are only having 1/10th share. Such right of the petitioners can be claimed only on establishing of the fact that this property is ‘Ayautaka’. His client is prepared to deposit further sum of Rs. 7 lakhs and odd being equivalent to 1/10th of the total consideration money already paid. In the event the petitioners are not agreeable to sell their share in the entire property, they at the highest can claim co-ownership of 1/10th undivided share and nothing more.
17. Mr. Kar submits the application taken out by his client for direction upon the Receiver to rectify the shareholding should be allowed. Mr. Kar contends, otherwise his client is not in a position to get benefit of the order of sale.
18. Mr. P.K Das, learned senior Counsel appearing on behalf of Syamal Kumar Banerjee submits that the petitioners are Christian as his father Salil converted himself into Christianity immediately after his marriage. Therefore, by virtue of Section 26 of Indian Succession Act, 1956, the petitioners cannot claim any interest in any of the properties left behind by Surendra or Sudhir.
19. He has drawn my attention to the will of Salil and submits it will appear from the statements made therein beyond any shadow of doubt that Salil converted into Christianity. Even assuming the petitioners are Hindus, they do not have any locus standi to challenge the grant of probate of will of sudhir, since he was survived by his younger brother Salil. On death of Sudhir sons of predeceased brother Salil, being the petitioners herein cannot have any right of inheritance in case of death intestacy as the other brothers and sisters were surviving on his death.
20. Mr. Das contends further in this summary proceedings disputed question of fact cannot be decided in as much as it is necessary for the Court to find out the ownership of the property which have been sold by the order of this Court, vis-a-vis petitioners' right, title and interest therein. In this context he has relied on a decision of Supreme Court reported in AIR 1962 SC 1471. He contends admittedly the Pratapaditya Road property belonged to mother, Bangur Avenue property is a trust property, Ultadanga Road property belonged to Sudhir since deceased and the other immovable property is a thika tenancy right and Sudhir was the thika tenant. This fact will appear from the various documents, namely report of the Receiver appointed by this Court. No challenge has been thrown against the report of the Receiver by the petitioners, as such prima facie Surendra Nath did not have any right, title and interest in this property, naturally the petitioners cannot claim any right, title and interest therein.
21. As far as the order of status quo passed by the learned Civil Judge Junior Division of Sealdah is concerned it is of no value by reason of the fact that it was passed ex parte without notice to his client and such an order is not binding upon his client.
22. Moreover, he contends that this order is null and void, because this was passed on an incompetent suit which was filed by so-called executor through constituted attorney in respect of alleged will of Salil since deceased. Though it is mentioned probate has been granted and such probate has not been produced. He submits the executor cannot establish any right in relation to will unless probate is obtained and produced in view of Sections 212, 213, 214 and 228 of the Indian Succession Act, 1925. He has relied on decision of Supreme Court reported in AIR 1962 SC 1471 in this connection. Therefore, the order of Sealdah Court should be overlooked as this order is null and void for lack of jurisdiction and this point can be taken at any stage of any proceeding as held by the Supreme Court in a case reported in AIR 1954 SC 340. Therefore order of sale of this Court is not affected by the order of Sealdah Court.
23. There are other applications he contends, taken out by the petitioners the same should be dismissed in view of the prayer made therein for collecting evidence. In support of his submission he has relied on a decision of Supreme Court reported in AIR 1961 SC 218.
24. Ms Iti Dutta appearing on behalf of Shyamal Kumar Banerjee adopts the argument of Mr. Das and submits that her client is prepared to hand over the stocks and securities belonged to the father of Surendra Nath Banerjee, since deceased. So far as the immovable properties are concerned, she submits petitioners do not have any interest whatsoever.
25. I have heard the respective contention of the learned Counsels in this matter. Mr. Das who has spear headed attack of opposition against these two applications, took a very tricky but effective point that the application of Scot, Stephen and Henry Hophkin is not maintainable as these are made through so called constituted Attorney who is having no authority. I asked Mr. Chatterjee to produce the document of authority of Sitangshu Kumar Roy, who has signed and verified the application. Two original power of attorney have been produced and I am satisfied Sitangshu is authorized to make this application. These two powers of attorneys are written documents signed by Scot and Stephen and authenticated by the Notary in America. So, I do not think there is any substance in this point, I overrule the same.
26. Next point of Mr. Das is maintainability of the application since no lis is pending and further Scot and Stephen are strangers to this proceeding. The present application deserves to be dismissed on that ground alone, he urges. This is again in my view is not tenable in this case, as it is settled position of law, that when any application on ground of fraud is brought before the Court challenging any order, the Civil Court is not denuded of power upon discovery of fraud to do the needful, and Section 151 of the Code of Civil Procedure is to clothe with the power and jurisdiction of the Court. Even in absence of Section 151 of the Code of Civil Procedure the Court inheres the authority to rectify its own mistake whenever it is brought before it for the simple reason that the Court is not supposed to commit wrong resulting injustice, rather justice always, when it is detected the Court unknowingly is in path of injustice. It will automatically come to the track of justice, instantly, for which no additional power from outside viz. law maker is needed. This automatic change of course, is in my view, one of the modes of exercise of inherent power. In the petition the grave allegation of fraud have been made out and this needs inquiry.
27. The Supreme Court in several decisions following the old decision of Privy Council more often than not has laid down that whenever fraud, whatever may be the nature and character, is alleged the Court can set right in any proceeding including collateral proceedings. This remedy is available to third parties also and even after the lis is over if it is established his right is affected and serious injustice is caused. In this connection I can remember a Supreme Court decision reported in (1994) 1 SCC 1. So I hold that his application is perfectly maintainable even after disposal of the lis itself and at the instance of the third party.
28. The application is entertained always having regard to the allegations made out in the petition only and these allegations in my view are sufficiently made out to exercise jurisdiction under inherent power of the Court.
29. Of course, this depends upon the natural aspect of the matter as to whether the order sought to be recalled and passed in a probate proceedings does affect the petitioners' right or not. Mr. Chatterjee is right in saying that the consent order sought to be recalled does not relate to granting probate of the alleged will of Sudhir only, it covers many aspects namely sale of various properties which did not belong to Sudhir exclusively. It appears from the impugned consent order that immovable property at 40B/40/2 Pratapaditya Road, Calcutta has been sold to the nominee of Sunil Kumar Banerjee whom Mr. Das represented, Dr. A.K Sharaf. Permission has been granted to Sunil to sell the property (being holding No. 415/120) No. P-64, Block-I, Bangur Avenue Calcutta which is the property of Laxmi Devi Estate, two Calcutta Stock Exchange Cards have been given away to Shyamal and Sunil. Sunil has been allotted with Thika Tenancy right at 11/2 Ultadangha Road and the structure as well. In this sense Mr. Chatterjee's clients are interested parties to impugn the order. Had the order concerned with grant of probate simplicitor, the petitioners would not have locus to challenge the same.
30. So it is very pertinent to ascertain to decide question of maintainability of this application, who are the original owners of the aforesaid properties, in other words precisely, have these properties been inherited from Suren or self-acquired property of Sudhir? If it is found the properties exclusively belonged to Sudhir since deceased, Scot and Stephen cannot inherit property even applying the rule of Hindu Succession Act, 1956 by reason of the fact their father Salil predeceased Sudhir. Under Section 8 read with the schedule of the said Act, sons of predeceased brother of a Hindu does not come within the category of Class II heirs and heiress. Brothers, sisters or father do not come within the purview of Class I heirs as described in the schedule, who get preference to heirs described in Class II. In Class II it provides that the heirs falling within the category of entry II of the same Class get preference to those mentioned in other subsequent entries. The brother's sons come within entry IV, whereas brothers and sisters come within entry II. Accordingly as rightly submitted by Mr. Das unless the petitioners herein can establish the properties mentioned in the impugned consent order belonged to Surendra this application cannot be maintained.
31. In pursuance of the impugned consent order I am to examine the contents of the will of Sudhir to find his title to the properties disposed of by him. In his will he has mentioned that he bequeathed all his assets both immovable and movable of every kind and nature wherever situate including bank accounts some of which had nominees. In the will it has also been mentioned that the present petitioners (Scot and Stephens) should also be looked after whenever they will come to India. Therefore, it is clear that it has not been specifically mentioned which are the properties belonged to him. The affidavit of assets filed in support of this probate application would be useful guidance to find out the properties both immovable and movable left behind by Sudhir. Admittedly it was an application for granting probate of the will. With this application an affidavit of assets has been annexed. I find there is no whisper of any immovable property rather the same being mentioned to be nil. Therefore, I can safely presume that Salil did not have any property of his own except his share of inheritance from his father's property, if at all inherited by him. In this connection affidavit of assets in relation to Suren's will be an importantly relevant and useful one, to find the title of the properties mentioned in the impugned consent order.
32. In the affidavit of assets filed in connection with the probate proceedings of the alleged will of Surendra the property situates at 40.B/40/2 Pratapaditya Road has been shown to have been belonging to him, but it appears to me on production of the Xerox copies of the certified copy of the conveyance that actually the property was purchased by and/or in the name of Sarala Bala, being the predeceased wife of Surendra. It might or might not be a case of benami of Surendra. But nobody has suggested such case. Therefore, it would be unfair if this Court tries to probe into this aspect. This Court will proceed on the basis of the apparent transactions. Therefore, I hold Pratapaditya Road property belonged to and/or acquired by Sarala Bala. Admittedly Sarala Bala predeceased Salil, long before Hindu Succession Act, 1956 came into operation. Now legal question posed to Court is who could inherit property of the mother.
33. Mr. Adhip Kar learned Counsel appearing on behalf of Dr. Sharaf, who is the nominee purchaser in terms of the impugned order, submits that the present petitioners Scott and Stephen have no locus standi as having no interest in this property, cannot challenge the aforesaid sale, because of the fact this property is a Stridhana and the mode of succession of Stridhana of a women who died prior to 1956 Act has been provided in Articles 120, 125, 134 and 154 of Hindu Law (Mulla) as also the Hindu Law of Golap Shastri page 835. According to him by virtue of this law the daughters to the exclusion of other heirs and heiress will inherit the property because of the character of stridhana.
34. This Court has to examine whether Scot and Stephen can claim any interest in this property to maintain the present application. I am of the view as has been rightly submitted by Mr. Pratap Chatterjee prior to Hindu Succession Act, 1956 stridhana was classified in two categories one ‘yautaka’ and another ‘ayautaka’. As far as succession under Dayabhaga School of law is concerned, Article 154 Hindu Law (Mulla) at page 209 15th Edition, the aforesaid Article provides as follows.
“154. Classification of stridhana. - Stridhana according to the Dayabhaga School may be divided, for the purposes of succession, into four classes:
(1) Shulka, that is, a present to induce the bride to go to her husband's house.
(2) Yautaka, that is, gifts made at the time of marriage. This term has been interpreted by the High Court of Calcutta as including not only gifts made before the nuptial fire but gifts made during the continuance of the marriage ceremonies, that is the ceremonies beginning with shraddha and ending with that of prostrating before the husband. It is conceived that it includes gift from strangers made before the nuptial fire and at the bridal procession.
(3) Gifts and bequests from the father made after marriage. (Gifts made by relations subsequent to marriage are called anwadheyaka. The present class relate to anwadheyaka from father.)
(4) Ayautaka, that is, gifts and bequests from relations made before or after marriage. This class includes gifts and bequests from the father made before marriage, but not those made after marriage. The latter come under the third class. Gifts from the father at the time of marriage fall within the second class.”
35. I find force in the submission of Mr. Chatterjee having regard to the nature of the property and the way it was acquired, the Pratapaditya Road property cannot be a ‘yautaka’ as this lady was married long before its purchase, so it cannot be said that it was a gift given before or at the time of marriage of this lady. Therefore, Article 157 of the Hindu Law of the same book will govern rule of succession. He has drawn my attention to the aforesaid Article, which is quoted hereunder:
“157. Succession ayautaka. - Ayautaka passes in the following order:
(1) Son(s) and maiden daughters, taking together in equal shares;
(2) married daugthers who have, or are likely to have sons;
(3) son's son;
(4) daughter's sons.
36. It is an admitted position that the lady died leaving amongst other Salil Banerjee since deceased being one of the four sons. Therefore on death of the aforesaid lady Salil must have inherited along with other sons of the said lady and maiden daughters. I am not trying to find out who were maiden daughters at that time to succeed this property, as it is not called for. So in 1946 undivided interest in the said Pratapaditta Road property had devolved upon him and it is a vested interest, which cannot be divested. I am not deciding the extent of the share in this property inherited by Salil, since deceased, as it is suffice for this proceeding to hold that he had interest. Therefore the contention of Mr. Kar that Salil being the father of Scot and Stephen had no interest, is not acceptable to this Court.
37. Next question comes in as to whether Scot and Stephen as well as Henry Hofkin are entitled to maintain this application. This has been questioned by Mr. Das on two grounds viz. because of Section 26 of the Hindu Succession Act, 1956 and Sections 213 and 229 of Indian Succession Act, 1925. As far as Henry Hofkin is concerned, I accept the argument of Mr. Das that without production of the probate of the alleged will of Salil Henry Hofkin cannot get any final order on this application only he can maintain a proceeding. I accept the argument of Mr. Das that without production of the probate of the alleged will of Salil Henry Hofkin cannot get any final order on this application only he can maintain a proceeding. I refrained myself from discussing and deciding the question of locus of Henry Hopkins as executor without production of probate as this issue will be dealt with in the suit filed in Sealdah Court.
38. However, the probate has not been produced before this Court. Presently I resume there is no will as such two sons namely Scot and Stiphen are the heirs and legal representative of Salil and they can very well maintain this application, so this application is now being considered at their instance and not at the instance of Henry Hofkins.
39. The Contention of Mr. Das is that by virtue of Section 26 of the Hindu Succession Act, 1956 Scot and Stiphen are disqualified to inherit the property of his relations. In my view there is little fallacy in his argument, as Section 26 of the aforesaid Act will not be applicable in relation to the property of the father of the children of convert Hindu. Language in Section 26 is clear enough to reach this legal conclusion. Therefore I set out Section 26 of the said Act.
“26. Where, before or after the commencement of this Act, a Hindu has ceased or ceases to be a Hindu by conversion to another religion, children born to him or after such conversion and their descendants shall be disqualified from inheriting the property of any of their Hindu relatives, unless such children or descendants are Hindus at the time when the succession opens.”
40. Their father Salil had already inherited his undivided share and the same had vested unto him before these two sons were born or even before Salil became Christian. Section 26 will be applicable if succession opens after birth of children subsequent to conversion of their father or mother not before conversion in relation to the properties of the other relation. For instance had Sarala Bala died after death of her sons Salil these two sons being grand sons, and being Christian could not have inherited the property.
41. I hold that these two sons of Salil have interest through their father in the Pratapaditya Road property, as such they are competent to file this application and to challenge the impugned terms of settlement whereby the said property has been sold without their consent or signature.
42. Consequently the question will arise as to whether the order of sale and factual sale of the property situates at Pratapaditya Road in favour of Dr. Sharaf is to be set aside as a whole or not, for Scot and Stephen are not signatories to the aforesaid terms of settlement.
43. Mr. Kar is right in saying that the entire sale cannot be set aside by reason of the fact that the other co-sharers have not come forward to ask for setting aside and this order of sale shall be binding upon the signatories of the co-sharers.
44. Mr. Chatterjee contended that the heirs of one of the daughters of Sarala Bala, namely Nilima, since deceased have not signed the said terms of settlement. I think this issue should not be addressed as no one has come forward to challenge the terms of settlement, that apart nothing has been produced before me whether, Nilima was maiden at the time of death of Sarala Bala Devi, since deceased or not. I have already observed Article 157 will govern the rule of inheretence of ‘Ayautaka Stridhana’ and the sons and maiden daughters get precedence over the married daughters. In the event it is found that Nilima had been married before the death of her mother Sarala Bala then the sons and other maiden daughters only inherited this property of Sarala Bala, namely Pratapaditya Road Property.
45. Since nobody has questioned the right of inheritance of other daughters. I do not wish to decide right of inheritance in the manner different from what has already been accepted by all the parties has been in terms of the settlement. So, I have kept this issue open as far as right of inheritance of Nilima vis-a-vis her heirs and legal representatives and also the co-sharers are concerned.
46. I, therefore, hold and declare that Dr. sharaf the client of Mr. Kar has acquired the right, title and interest of all the signatories to the said terms of settlement if any, and the share of Salil, since deceased, is declared not to have been sold. I refuse to set aside this sale in its entirety. However, I modify the aforesaid order in the manner as above.
47. Therefore, the application for rectification of the deed is taken up for consideration, in view of the declaration as above. I am of the view that the conveyance is to be rectified incorporating that Dr. Saraf has not acquired undivided interest of Salil. Let a copy of this judgment and order be sent to Registering authorities concerned to do the needful in respect of Deed No. 2438 entered in Book No. 1 Volume No. 72 at pages 399 to 426 of 1999.
48. After this rectification is completed it would be open for Dr. Sharaf to take steps for partition and demarcation of the property between him and Scot and Stiphen if so advised.
49. Mr. Chatterjee has taken a legal point saying that by the terms of settlement obtaining of no objection certificate under Section 230(A) or under Section 269 (UD) of the Income Tax Act, 1961 and further Urban Land Ceiling Act, 1976 have been dispensed with. He says that this is not permissible under the law. In my view this cannot be gone into by me sitting in a co-ordinate jurisdiction. This order was passed in exercising his discretion by the learned Judge observing aforesaid requirement is not necessary, so it is not for this Court to sit on appeal of this judgment.
50. As far as the requirement of no objection certificate under Section 269(UD) of the Income Tax Act is concerned it appears from the language no such clearance is expressly needed. Under the provision of this Section the appropriate authority can exercise their authority to pass order or preemptiver purchase, when it is presumed that the property is sought to be sold at grossly understated consideration mentioned in the agreement.
51. I find there is only legal embargo as mentioned in Section 269(UC) that needs to be considered, is no transfer of any immovable property in such area and such value exceeding Rs. 5 lacs (at the relevant times it was Rs. 10 lacs), shall be effected except after an agreement in writing for sale in prescribed form is entered into between the transferor and transferee, at least four months before the intended date of transfer and to be furnished to the appropriate authority. Section 269(UC) read with Section 269(UD) of the said Act will be applicable in case of voluntary sale and not in case of Court sale. The whole object of providing the aforesaid legal measure was to check and prevent evasion of tax, and one of such notorious and nefarious means was to sell the property at a low price concealing the real consideration in the transaction. That is why the provision of preemptive purchase in case of voluntary transfer, was incorporated in the Income Tax Act. Before the aforesaid Chapter XXC was brought into the statute book, the people were prone to transfer the property at an artificially low price. The actual market price was rarely shown in the conveyance or in the agreement or even in certain cases no written agreement was entered into. In case of Court sale there is hardly any scope for concealing the real value of the property. In this case the dealing was between the two private parties but then Court had accepted the price of the property is the real market price not the apparent one. As such the question of evasion of taxes does not arise.
52. The object and reasons for making provisions of the aforesaid Section and Chapter XXC was explained in great details by the Supreme Court in case of C.B Goutam v. Union of India reported in 199 ITR 530 (SC). The decision of the Supreme Court was followed in a numerous cases in all the High Courts in this country as well as the Supreme Court subsequently. As a matter of fact I have discussed the object and purpose of bringing the aforesaid provision for preemptive purchase under Section 269(UD) of the Income Tax Act in case of ITC Ltd. v. Appropriate Authority (Cal) reported in ITR (Vol. 257) p. 495. In that case I observed amongst others that:
“…..right to acquire property of his own choice in any part of India, by a citizen is a fundamental right as well. However such a right is always subjected to reasonable restriction as contemplated in Article 19(2) of the Constitution of India. In my view, the preemptive purchase by Central Government under the aforesaid Chapter is one of the measures to put reasonable restriction and this Section engrafted in the statute to check and prevent evasion of Income Tax, which is more after adopted by selling a property at under-valuation”.
53. Thus the requirement of any clearance certificate under the statute itself in case of a Court sale is not required. It is for the appropriate authority of the Central Government to come forward to challenge the sale, for exercising their power coupled with right of preemptive purchase. The requirement of obtaining certificate of the assessing officer under section 230(A) of the said Act was made compulsory for protecting the revenue so that the vendor without making sufficient provision for payment of due income tax or other liabilities cannot transfer and sell off the property. In this case when the Court thought it fit, no such clearance is necessary, it shall be presumed in the mind of the Court that all provision for liquidating outstanding dues in relation to any tax payable by the vendor have been ensured. Therefore, the submission of Mr. Chatterjee in this regard does not appear to be sound to set aside the sale on this ground.
54. Now I shall be dealing with the property being plot no. 64 Block-B Bangur Avenue in the terms of settlement the plot no. 63 Block-B Bangur Avenue is mentioned. It appears the plot no. 63 Block-B of the said property is the subject matter of the Title Suit, being No. 1 of 199 and this Title Suit has been filed by Henry H. Hofkins as a plaintiff and Sunil Kumar Banerjee, defendant being represented by Mr. Das. Similarly the property being plot no. 64 Bangur Avenue is also the subject matter of the Title Suit before the learned 3rd Munsef at Sealdah. In both the two suits the aforesaid civil court has passed order of status quo. The terms of settlement has dealt with plot no. 64, which is the subject matter of the suit No. 1 of 1999. The consent order was passed in connection with this property on 21st August, 1998 and there was no order of injunction concerning it at the time of passing of the consent order. The purchasers in relation to this property have already taken possession of the same. Since the disputes are pending before Civil Court as regard title and interest of Scot and Stiphen in relation to their father's interest in the property it would not be proper for this Court to observe anything else. All that I can say that these are highly disputed questions of fact and law and the petitioners herein have rightly approached the competent Court of Civil jurisdiction and I clarify the decision which might be rendered by the Civil Court will have final effect of the consent order passed by this court, must yield to the decision of the civil court as in the event it is decided Henry Hogfkins and for that matter the estate of Salil has no right, title and interest in this property being plot no. 64 Bangur Avenue then certainly the terms of settlement will be binding upon them as they are not the signatories, admittedly to this property.
55. Mr. Das submits that, I should ignore the order of the Civil Court or proceedings initiated by Henry Hofkins, as the same is an incompetent proceeding. I am of the view that all these points should be taken before the appropriate civil court and I do not wish to decide the same.
56. As far as the order of status quo granted by the civil court in relation to the plot no. p-63 is concerned I think this is not the subject matter in this terms of settlement and the same is kept beyond the purview of the consent order.
57. Now I shall be dealing with the allotment of the house and property at 11/2 Ultodangha Road and the thika tenanted structure at 118 Raja Dinendra Street. It is submitted by Mr. Das that Scot and Stiphen had no right, title and interst in these two properties. As such they do not have any locus standi to assail the aforesaid order passed in terms of settlement by reason of the fact that the same belonged to Sunil Kumar Banerjee as a thika tenant. He submits further that from the report of the Receiver appointed by this Court it appears those two properties never belonged to Suren nor did he since deceased own the same. I am unable to accept his submission for simple reason, nothing has been produced before me to establish the right of thika tenancy, excepting a casual recording of the Receiver appointed by this Court to decide conclusively.
58. I cannot accept the argument of Mr. Das that Sunil had interest in respect of the aforesaid two properties for the simple reason that the affidavit of assets filed by his client in relation to the probate proceedings of Sudhir there is no mention nor whisper about the aforesaid property being held by Sudhir during his life time.
59. In the affidavit of assets filed by Sudhir himself during his lifetime while applying for grant of probate of the alleged will of Suren the aforesaid two properties, have been shown to be the part of the immovable property owned and/or held by Suren. At the highest Sudhir could have his undivided share and/or interest as one of the sons of Suren.
60. Therefore, I am of the view that Scot and Stiphen had inherited their father's share in relation to the aforesaid two properties. Naturally these two persons have locus standi to challenge the allotment of the said property in favour of Syamal Kumar Banerjee to the exclusion of these two petitioners are invalid and illegal. Therefore, I declare that the aforesaid terms of settlement allotting and/or transferring the right, title and interest in the aforesaid two properties in favour of Syamal is invalid, illegal to the extent of the shares of these two persons.
61. Similarly allotment of the other movable properties belonged to Surendra Nath Banerjee in favour of Syamal by this impugned terms of settlement is bad and invalid to the extent of the shares and interest of these two person.
62. Accordingly I direct Sunil Kumar Banerjee to disclose the nature of movable properties he has received in terms of the terms of settlement and also the liabilities.
63. After delivery of the judgment learned Counsel appearing for the parties submit that necessary directions are to be given in respective applications separately, so let these applications appear again tomorrow (16.04.2004) in the list of further directions.
DICTATED ORDER
64. K.J Sengupta, J.:— In view of my judgment as above relating to Pratapadirya Road, property, I think until and unless shares of Scott and Stephen Banerjee are sold to Mr. Kar's clients, the question of passing the title to this property in its entirety in favour of Mr. Kar's client does not arise. Under these circumstances, I am of the view the application made by this client for rectification of this deed may not be allowed as it is prayed for. Rectification of these deed may be done only after making an amendment that the shares of Scott and Stepehn Banerjee have not been sold out. In the event the property of Scott and Stephen Banerjee is sold, as per my judgment, to Mr. Kar's client, then opportunity shall be given to apply for rectification of the conveyance.
65. So far as the application of Mr. Bijon Roy's client is concerned, prayer is allowed. Accordingly, I direct the Administrator Mr. N. Himatsinghka and/or the Bank, whosoever may be competent; to release a sum of Rs. 1 lac together with interest accrued thereon after having satisfied that the appeal has been withdrawn in terms of my earlier order. In the event such appeal has been disposed of by this time then the scope of the order shall also be examined. If it is found that the appeal has been dismissed or withdrawn then the aforesaid amount, in terms of the order of Justice Sujit Kumar Sinha (as His Lordship then was), shall be carried out within a period of 8 (eight) weeks from the date of communication of this order.
66. In my view, Receiver appointed by this Court earlier has not been paid reasonable remuneration. She has been paid merely 350 Gms. I think such remuneration is not commensurate to the labour she has put in. Therefore, she shall be paid final remuneration assessed at 600 Gms. to be paid by Mr. Joy Saha's client because at his instance Receiver was appointed and did satisfactory job by finding out the assets, properties and also the other things. Such remuneration shall be paid within a fortnight from date. Upon receiving such payment, she will stand discharged. Filing of accounts is disposed with. Administrator and/or concerned Bank, Receiver and all parties concerned are to act on a signed copy of the minutes of this order.
67. Lex xeroxed signed copy of this order is made available to the parties only after putting in requisition for drawing up and completion of the order and also for the Xeroxed certified copy thereof.