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TMI Blog1955 (2) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... 1938 these lands, being no longer required for the purpose of the Railway, were sold by the Governor-General to Lady Pochkhanawalla and others as joint tenants under a deed, Exhibit A. On 28-3-1939 the survivor of the purchasers under Exhibit A conveyed the lands in trust under Exhibit B, and the respondents are the trustees appointed under that deed. In April 1942 the appellant acting under the provisions of Bombay Act No. II of 1876, issued notices to the respondents proposing to levy assessment on the lands at the rates mentioned therein, and calling for their representation. In their reply, the respondents denied the right of the appellant to assess the lands to revenue, and followed it up by instituting two suits before the Revenue Judge for establishing their rights. In their plaints, they alleged that under the provisions of the Foras Act the maximum assessment leviable on the lands was 9 reas per burga, and that the Government had no right to enhance it; that the effect of the land acquisition proceedings between 1864 and 1867 was to extinguish the right of the State to levy even this assessment, and that further, having purchased the properties absolutely from the Gover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; as defined in the Act, that the appellant issued notices to them in April 1942. In their reply notices and in the plaints, the respondents did not dispute that position, but only contended in terms of section 8 that they had a specific right in limitation of the right of the Government to assess the lands; and the entire controversy in the Courts below was whether they had established that right. No contention was raised that they were not superior holders as defined in the Act, and that, in consequence, no assessment could be imposed on the lands under section 8 of the Act. In the argument before us, the contention was sought to be raised for the first time by the learned Attorney-General that the proceedings taken by the Collector under section 8 were incompetent, as that section would apply only to lands held by superior holders, that the definition of 'superior' holier' in section 3 (4) as meaning the person having the highest title under the Provincial Government to any land in the City of Bombay would take in only persons who held on a derivative tenure from the Government, that persons who acquired lands from the Government under an outright sale could not be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 857, and (3) the sale deed, Exhibit A. Taking first the Foras Act: For a correct appreciation of its provisions, it is necessary to refer -Co the history of the lands, which are dealt with therein. The Island of Bombay once formed part of the Portuguese Domi- nions in India. In 1661 when Princess Infant Catherine was married to King Charles 11 of England, it was ceded by the King of Portugal to the British Crown as dowry, and by a Royal Charter dated 27th March 1668 King Charles 11 granted it to the East India Company. At that time the Island consisted only of the Fort and the town, and outside the walls of the town it was scarcely more than rock and marsh which became a group of islands every day on high tide . Vide Shapurji Jivanji v. The Collector of Bombay([1885] I.L.R. 9 Bom. 483, 488). It appears from Warden's Report on the Landed Tenures in Bombay and Le Mesurier's Report on the Foras lands, that during the 18th Century the East India Company started reclaiming these lands, and invited the inhabitants to cultivate them, at first without payment of any assessment and subsequently on favourable rates. These payments were called Foras . The meaning of this word is thu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the said plan should be extinguished, save as hereinafter mentioned. It is enacted as follows: Section 2 enacts that: From and after the said 1st day of July, the rights of the said Company in all of the said lands mentioned in the said plan No. 1, except those mentioned in the said plan No. 2, shall be extinguished in favour of the persons who shall then hold the same respectively as the immediate rent-payers to the said Company, saving the rents now severally payable in respect of such lands, which shall continue payable and recoverable by distress, or by any means by which land revenue in Bombay is or shall be recoverable, under any Act or Regulation Section 4 provides: Nothing herein contained shall exempt such lands from being liable-to any further general taxes on land in Bombay According to the appellant, the effect of these provisions was to grant the lands to the occupants on a permanent tenure, heritable and alienable, but not further to grant them on a permanent assessment. Reliance was also placed on the decision in Shapurji Jivanji v. The Collector of Bombay([1885] I.L.R. 9 Bom. 483, 488.), where it was held generally that the Government had the rig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reserve the rights of the Company and not to confer on the occupants rights in addition to what the body of the section had granted to them. It is true that the setting in which these words occur is more appropriate for reserving rights in favour of the Company than for declaring any in favour of the occupants. But to adopt the construction contended for by the appellant would be to render the words now severally payable and which shall continue to be payable wholly meaningless. Notwithstanding that the drafting is inartistic, the true import of the clause unmistakably is that while, on the one hand, the right of the Government to recover the assessment is saved, it is, on the other hand, limited to the amount then payable by the occupants. The contention of the respondents that under the Foras Act they acquired a specific right to hold the lands on payment of assessment not exceeding what was then payable, must, therefore, be accepted We have next to decide what effect the proceedings taken by the Government under the Land Acquisition Act No. VI of 1857 during the years 1864 to 1867 have on the rights of the parties. Section VIII of the Act is as follows: When the Collector ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... position to pass it on absolutely for public user. In the Matter of the Land Acquisition Act: The Government of Bombay v. Esupali Salebhai([1909] I.L.R. 34 Bom. 618, 686.) Batchelor, J. observed: In other words Government, as it seems to me, are not debarred from acquiring and paying for the only outstanding interests merely because the Act, which primarily contemplates all interests as held outside Government, directs that the entire compensation based upon the market value of the whole of land, must be distributed among the claimants . There, the Government claimed ownership of the land on which there stood buildings belonging to the claimants, and it was held that the Government was bound to acquire and pay only for the superstructure, as it was already the owner of the site. Similarly in Deputy Collector, Calicut Division v. Aiyavu Pillay([1911] 9 I-C-341), Wallis, J. (as he then was) observed: 'It is, in my opinion, clear that the Act does not contemplate or provide for the acquisition of any interest which already belongs to Government in land which is being acquired under the Act, but only for the acquisition of such interests in the land as do not already belong to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the land. Under section 16, when the Collector make an award he may take possession of the land which shall thereupon vest absolutely in the Government free from all encumbrance . The word en- cumbrance in this section can only mean interests in respect of which a compensation was made under section 11, or could have been claimed. It cannot include the right of the Government to levy assessment on the lands. The Government is not a person interested within the definition in section 3 (b), and, as already stated, the Act does not contemplate its interest being valued or compensation being awarded therefor. It is true that there is in Act No. VI of 1857 nothing corresponding to section 3(b) of Act No. I of 1984, but an examination of the provisions of Act No. VI of 1857 clearly shows that the subject-matter of acquisition under that Act was only ownership over the lands or its constituent rights and not the right of the Government to levy assessment. The provisions relating to the issue of notices to persons interested and the apportionment of compensation among them are substantially the same. Moreover, under section VIII the Government is to take the lands free from all oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llows section 3 with a positive declaration that all provisions, restrictions, conditions and limitations over shall take effect according to their tenor. Reading the enactment as a whole, the scope of section 3 is that it saves provisions, restrictions, conditions and limitations over which would be bad under the provisions of the Transfer of Property Act, such as conditions in restraint of alienations or enjoyment repugnant to the nature of the estate, limitations offending the rule against perpetuities and the like. But no question arises here as to the validity of any provision, restriction, condition, or limitation over, contained in Exhibit A on the ground that it is in contravention of any of the provisions of the Transfer of Property Act, and there is accordingly nothing on which section 3 could take effect. It is argued by the learned Attorney-General that this limitation on the scope of the Act applies in terms only to section 2, and that section 3 goes much further, and is general and unqualified in its operation. The scope of section 3 came up for consideration before the Privy Council in Thakur Jagannath Baksh Singh v. The United Provinces(1946 F.L.J. 88). After ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and that the Government was estopped from enhancing the assessment. He was also prepared to hold that the correspondence between the purchaser and the Government prior to the sale amounted to a collateral contract not to raise the assessment. Chandavarkar, J., concurred in the decision, and in the course of his judgment observed: .... when we have regard to the nature of the transaction, viz., that Government was selling the property out-and-out as any private proprietor-when we look to the whole of the language used .... the intention of the parties must be taken to have been that the purchaser was to be liable to pay the amount of 9 pies per square yard per annum then levied as assessment and no more . These observations have been relied on as supporting the contention that when there is an absolute sale by the Government, it amounts to an agreement not to levy more assessment than was payable at that time. But the remarks of the learned Judge have reference to the recitals in the deed dated 20-12-1887 and the negotiations between the purchaser and the Government which are referred to in the passage, and not to the character of the transfer as an absolute sale; and the decis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inion, that upon the true construction of this grant, the creek where it bounds the land is ad medium film, included within it. In so holding they do not intend to differ from old authorities in respect to Crown grants; but upon a question of the meaning of the words, the same rules of common sense and justice must apply, whether the subject-matter of construc- tion be a grant from the Crown, or from a subject; it is always a question of intention, to be collected from the language used with reference to the surrounding circumstances's. Exhibit A has to be construed in the light of these principles. As already stated, there is no recital in the deed that the purchasers are entitled to, hold the lands free of assessment. On the other hand, it expressly provides that the properties will be subject to the payment of all cesses, taxes, rates, assessments, dues and duties whatsoever now or hereafter to become payable in respect thereof , which words would in their natural and ordinary sense cover the present assessment. In Dadoba v. Collector of Bombay([1901] I.L.R. 25 Bom. 714.), the Court had to consider a clause similar to the above contained in a deed executed by the Governm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re acquired under the Land Acquisition at No. VI of 1857 and 22-11-1938 when they were sold under Exhibit A they continued to retain their character as Foras lands, that if no assessment was paid on the lands during that period, it was because the hand to pay and the hand to receive were the same, that when they came to the respondents under Exhibit A, they became impressed with the Foras tenure, and that, in consequence, they were liable to be assessed only at the rate payable under Act No. VI of 1851. This contention is, in our judgment, wholly untenable. When the lands were acquired under the Land Acquisition Act No. VI of 1857, the entire estate, right, title and interest subsisting thereon became extinguished, and the lands vested in the Government absolutely freed from Foras tenure, and when they were sold by the Government under Exhibit A the purchasers obtained them as freehold and not as Foras lands. As the tenure under which the lands were originally held had become extinguished as a result of the land acquisition proceedings, it was incapable of coming back to life, when the lands were sold under Exhibit A. In support of the contention that the incidents of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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