Allied Laws

Badru (since deceased) through L.R. and Ors. vs. NTPC Limited and Ors. AIR 2019 Supreme Court 3385

The land in question belonged to the appellants (landowners). The suit land was acquired by the State for the NTPC for public purpose. A compensation of Rs. 3,87,383 per bigha was awarded to the appellants for the land. But the appellants felt aggrieved and approached the Civil Court for determination of the compensation offered by the Land Acquisition Officer. The Civil Court partly allowed the reference in favour of the appellants and enhanced the compensation. The State and the NTPC felt aggrieved by the award and filed appeals before the High Court. The appellants instead of filing a regular appeal, filed cross objection under Order 41 Rule 22 of the CPC and sought enhancement in the compensation awarded. The High Court dismissed the appeals filed by the NTPC / State and, in consequence, also dismissed the cross objection filed by the appellants. The effect of the dismissal of the appeals and cross objection was upholding of the award passed by the Civil Court. The landowners felt aggrieved by the rejection of their cross objection and filed the present appeals by way of a special leave before the Supreme Court.

It was observed by the Supreme Court that one remedy was by way of appeal and the other remedy was to file cross objection. In this case, the landowners took recourse to the second remedy of filing cross objection. The High Court having dismissed the appeals filed by the State / NTPC was, therefore, required to examine whether any case was made out by the landowners in their cross objection for enhancement of compensation. Order 41 Rule 22(4) of the CPC provides that where, in any case in which any respondent has under this Rule filed a memorandum of objection, the original appeal is withdrawn or is dismissed for default, the objection so filed may nevertheless be heard and determined after such notice to the other parties as the Court thinks fit. Merely because the High Court dismissed the appeals filed by the respondents herein, though on merits, yet that by itself would not result in dismissal of the landowners’ cross objection also.

In view of the same, the Supreme Court held that the cross objection had to be disposed of on its merits notwithstanding the dismissal of the same by assigning reasons. The case was accordingly remanded to the High Court for deciding the cross objection filed by the landowners in accordance with law.

K.M. Refineries and Infraspace Pvt. Ltd. vs. State of Maharashtra (Bom.) (HC), www.itatonline.org

Under the New Package Scheme of Incentives, 1993, monetary and other incentives in the nature of tax subsidy or tax exemption at the rate prescribed in the scheme and other benefits were given. As per the eligibility certificate issued by the competent authority, the certificate was valid for nine years. The Commissioner of Sales Tax prescribed the effective date but while doing so, curtailed the validity period by about three years and incentives given in the Incentive Scheme have been substantially reduced by a new policy prescribing new tax structure of the State. The assessee challenged the policy on the ground that the new policy violates the principle of promissory estoppel.

Allowing the petition, the Court held that once a promise has been solemnly given by the State with an intention that it would be acted upon, and which has been indeed acted upon and liabilities suffered by the promisee, the State cannot be permitted to backtrack on the promise and change its position so as to cause loss to the promisee. The eligibility for sales-tax exemption cannot be withdrawn under GST. (W.P. No. 2209 of 2018, dated 16^th July, 2019).

Gannu Ram and another vs. Dhanmat Bai and Ors. AIR 2019 Chhattisgarh 148

The case was filed by Dhanmat Bai and Deni Bai, who were the daughters of Ramai before the trial court where it was held that the daughters were entitled to a share in the property in a case where the father had expired prior to the amendment in section 6 of the Hindu Succession Act. The daughters were born before 2005 and hence, the applicability of the 2005 amendment to them was in question. An appeal was preferred against such order where the question raised was whether the daughter of a pre-deceased karta / coparcener is entitled to have equal share in the ancestral property.

The court held that the daughters were entitled to a share in the property but only to the extent of the part of the shares of their father after a notional partition with the appellant since the appellant was the coparcener in the Hindu Joint Family property along with the father of the daughters. For passing an effective decree of partition in favour of the daughters, the trial court was first required to affect a notional partition between Ramai and his son (coparcener / appellant) allotting them half share each in the coparcenary property. Thereafter, a further partition is required to be affected in respect of the half share of the father which would devolve equally upon the daughters. The appeal was therefore partly allowed.

Aarshiya Gulati and Ors. vs. Kuldeep Singh Gulati and Ors. AIT 2019 (NOC) 577 (Del.)

While emphasising on the difference between partnership and a Hindu Joint Family firm, the court referred to Mulla who in his treatise Hindu Law (21^st edition) has pointed out the following points of difference between a partnership and a Hindu Joint Family firm: ‘In a joint family business no member of the family can say that he is the owner of one-half, one-third or one-fourth. The essence of joint Hindu family property is unity of ownership and community of interest and the shares of the members are not defined’.

The court also referred to the case of Nanchand Gangaram Shetji vs. Mallappa Mahalingappa Sadalge & Ors. where it was held that in a joint Hindu family business, no member of the family can say that he is the owner of one-half, one-third or one-fourth. The essence of joint Hindu family property is unity of ownership and community of interest and the shares of the members are not defined. Similarly, the pattern of the accounts of a joint Hindu family business maintained by the karta is different from those of a partnership. In the case of the former the shares of the individual members in the profits and losses are not worked out, while they have to be worked out in the case of partnership accounts.

In view of the same, the court held that a partnership property cannot be a Hindu Joint Family property.

Chief Manager, Bank of Baroda, Dhanbad branch vs. Amit and Ors. AIR 2019 Jharkhand 122

The brief facts of the case are that the petitioner bank had sanctioned a loan by keeping the property in question mortgaged by a collateral security and on having become a non-performing asset, a notice u/s 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, was issued, thereafter resorting to the provision of S. 13(4) of the Act. The respondent No. 1 (tenant) has entered into an agreement of tenancy prior to mortgaging of the property by the owner. When a notice u/s 13(4) was served on the owner, the respondent No. 1 filed a suit pleading therein that he is a monthly tenant and has been paying rent regularly and on time but without any receipt. The bank (creditor) appeared and filed show cause, disputed the claim of the respondent No. 1 by stating that the owner is a director of a private limited company and has got cash credit facility of Rs. 300 lakhs which was sanctioned and secured by getting a mortgage of the property; when the loanee became irregular and despite repeated requests and intimations did not pay the loan amount due to which the loan amount became an NPA; this forced the petitioner bank (creditor) to file a suit in the Debt Recovery Tribunal.

The tenant also filed a separate petition for grant of temporary injunction restraining the petitioner bank (creditor) from taking forceful possession of the tenanted premises.

It was observed by the court that no borrower shall lease any of the secured assets referred to in the notice without the prior written consent of the secured creditor and holding therein that save and except the process of tenancy, there cannot be any eviction of the tenant.

The court referred to the case of Kalsaria where the lease has been created after the property had been mortgaged and therefore, it has been held that before creating tenancy right before the date of mortgage, consent is required to be taken from the creditors. It is in the touchstone of this ratio and the definition of mortgage that the case in hand has been examined by the court.

It was held that since it was nowhere on record that before creating tenancy by virtue of agreement, prior consent of the creditor has been taken this fact ought to have been appreciated by the appellate court but having not done so, the appellate court has committed gross error.