THE AUTHORISED OFFICER, THANJAVUR & ANR. versus S. NAGANATHA AYYAR

THE AUTIIORISED OFFICER, THANJAVUR & ANR.

S. NAGANATHA AYYAR

May 4, 1979

[V. R. KRISHNA IYER AND A. P. SEN, JJ.]

The Tamll Nadu Land Reforms (Fixation of Ceiling on Land) Act, 1961-Ss. 7 and 22-Scope of-Sale, gift, transfer etc. of land made between certain dates void-Bona fide transfers if exempt by s. 22.

Section 7 of the Tamil Nadu Land Reforms (Fixation of Ceiling on Land) Act 1961, provides that on and from the date of commencement of the Act no person shall, except as otherwise provided in the Act, but subject to the pro-visions of Chapter VIlI, be entitled to hold land in 'excess of the ceiling area. Section 22 provides that where on or after the date of commencement of the Act (6th April, 1960) but before the notified date (2nd October, 1962) any person has transferred any l•nd held by him by sale, gift etc. the Authorued Officer within whose Jurisdiction such land holding of the major part thereof is situated may, after notice to such person and other persons affected by such transfer or partition and after such inquiry as he thinks fit to make, declare the transfer or partition to be void if he finds that the transfer or the partition, as the case may be, defeats any of the provisions of the Act.

The alienations in all the cases took many forms ranging from 3tridl1ana to bona fide !ale and they were executed between the date of commencemnt ot. the Act and notified date. The Land Tribunal held that the alienations were void because but for the alienations the holders would have had the lands in excess of the ceiling prescribed by the Act.

On the interpretation of s. 22 of the Act, the ){igh Court was of tile view thn.t the section covered only those sham, nominal and bogus transfers which are intended to defeat the provisions of the Act and which are inconsistent with the object provid'ed in s. 7. It was also held that transactions entered into in anticipation of the Ceiling Act would not be hit by the provisions prevent· ing such transfers except where they were mala fide or colourable; and that the word "defeat" in s. 22 should be taken as having been used to import sinister motive. It was therefore held that under s. 22 the Authorised Officer is entitled to declare as void only those transfers which are skam and nominal entered into with the avowed object of defeating the provisions of the Act with-out any bona fide intention to transfer title.

HELD: (I) If any transfer defeats the'provisions of the Act by reducing the extent of surplus land in excess of the ceiling available from any person such transaction, bona fide or not, is void in the matter of computation of the permissible area and the surplus area. The Authorised Officer is within hia p:ower if he ignores it as void for purposes of s. 22, s. 7 and other ceiling rela-ted provioions. [l132C]

{2) Looking at the words of s. 22 in the light of the scheme of prohibition of transfers to preserve the surplus land for distribution there is no justification for importing into s. 22 more than its words convey. The section says what it means. simple scan of the provision reveals that any transfer, gift, sur-render, settlement or other alienations may be declared void by the Authorized Officer, if he finds that the transfer or the partition defeats any of the provisions of this Act. fhe trichotomy is obvious : There must be transfer or other alienation; it must have taken place during 1he period mentioned in the section; it must have the effect of defeating any of the provisions of the Act. If these three elements are present, the Authoris'ed Officer must void the transfer. There is no rule for importing fourth principle that the transfer should be sham, nominal or bogus nor is there any additional consideration that if the transfer is bona fide for family necessity or other urgency then it is good even though it' defeats the provisions of the Act. The provision seeks to provide social justice for the landless and it defeats the purpose if, by the interpretative pro-cess, soft justice to large !and~holder. is brought ~bout. [I 130B-D]

(3) The literal meaning of the section is that any transfer or other aliena-tion mentiOilfd in it which reduces or impairs the otherwise available extent of surplus land beyond the ceiling defeats the provisions of the Act. This is the plain meaning of the section which gives no room for doubt or justification for importation of any further condition like sham, bogus etc.

(4) The High Court was wrong in its view that the Act being confisca-tory one, the public authority "invested with the power to enquire into and to invalidate transfer should act reasonably, and that such power should bo construed beneficially in favour of the subject who is affected by the statute." The approach of the High Court is inept and inapplicable when one considers agrarian reform legislation whose avowed purpose is to take away as much ex-E tent of land as policy dictates so that distribution thereof among the landless may be achieved. When whole legislation is geared to deprivation of pro-perty, rules which have frowned upon confiscatory legislation cannot apply at all. The jurisprudential principles in such situation cannot be the same as have be'en inher~d from culture which postulates the State v. the subject.

[1126E-0]

(5) While dealing with welfare legislation of so fundamental character as agrarian reform, the.Court must constantly remember that the statutory pil-gI'image to destination socir.J justice should be helped, not hampered, by judi-cial interpretation. It is true that Judges are constitutional invigilators and statutory interpreters; but they are also responsive and responsible to Part IV of the Constitution. The judiciary, in its sphere, shares the revolutionary pur· pose of the constitutional order and when called upon to decode social legisla• tion it must be animated by the goal-oriented approach. [1123E-H]

OVIL APPELLATE JURISDICTION : Civil Appeal Nos. 2542 to 2544 of 1972. •

Appeals by Special Leave from the Judgment and Order dated 11-12-1970 of the Madras High Court in Civil Revision Petitions Nos. 1824 and 1825/65.

V. P. Raman, Adv. Genl. and A. V. Rangam for the Appellant.

AUTHORISED OFFICER v. s. N. AYYAR (Krishna Iyer, J.) 1123

A. T. M. Sampath tor Respondent in C.A. 2542172.

K. S. Ramilmurthi, Mrs. Saroja Gopalkrishnan for Respondent in C.A. 2542172.

K. Jayaram and K. Ram Kumar for R. 1 in CA 2544172.

K. Rajendra Chaudhry for R. 2 in C.A. 2544172.

The Judgment of the Court was delivered by

KRISHNA IYER, J. The short point of Jaw. decided in the Jong judg-ment under appeal may justly be given short shrift. But the batch of Civil Revision Petitions allowed by the High Court involves legal issue of deep import from the angle of agrarian reform and surplus land available for distribution under its scheme that we deem it proper to discuss the core question at some length. If the statutory construc-tion which found favour with the High Court be correct the risk of reform legislation being condemned to functional futility is great, and so the State has come up in appeal by Special Leave challenging the High Court's interpretation of s. 22 of the Tamil Nadu Land Reforms (Fixation of Ceiling on land) Act, 1961 (for short, the Ceiling Act). Presently, we will set out the skeletal facts relating to the civil appeals and the scheme of the Act designed for distributive. justice in the field of agricultural land ownership, sufficient to disclose the purpose of the legislation, the mischief it intends to suppress, the reverse effect of the construction put on the key section (s. 22) in the judgment under appeal and the consequeut stultification of the objective of the Ceiling Act. While dealing with welfare legislation of so fundamental character as agrarian reform, t.he court must constantly remember that the statutory pilgrimage to 'destination social justice' should be helped, and not hampered, by judicial interpretation. For, the story of agrarian re-distribution in Tamil Nadu, as elsewhere, has been tardy and zigzag, what with legislative delays, judicial stays and in-validations, followed by fresh constitutional amendments and new constitutional challenges and statutory constructions, holding up, for decades, urgent measures of rural economic justice which was part of the pledges of the Freedom struggle. It is true that judges are constitu-tional invigilators and statutory interpreters; but they are also responsive and responsible to Part IV of the Constitution being one of the trinity of the nation's appointed instrumentalities in the transformation of the socio-economic order. The judiciary in its sphere, shares the revolutionary purpose of the Constitutional order, and when called upon to decode social legislation must be animated by goal-oriented approach. This is part of the dynamics of statutory intretation in the developing countries so that courts are not converted into rescue shelters for those who seek to defeat agrarian justice by cute transac-

lions of many manifestations now so similar in the country and illus-trated by the several cases under appeal. This caveat has become necessary because the judiciary is not mere umpire, as some assume, but an activist catalyst in the constitutional scheme.

This caveat has become

The Ceiling Act, in its structure and process, follows the common pattern. The object is equitable distribution of land to the land!~ by relieving those who hold more than the optimum extent fixed by the law. The success of the scheme depends on maximisation of' surplus land to be taken over by the State from large landholders. The strategy of fixing severe ceiling on land holdings was expected to be paralysed by anticipatory strategems by landholders and so ~ legislature sought to outwit them and clamped down pre-emptive res-trictions on transfer whereby the surplus takeover would be sabotaged, Chapter II prescribes the ceiling on land holdings and Chapter III proscribes certain types of deleterious transfers and future acquisitions. One such provision is s. 22 which falls for immediate dissection. The machinery for working out the scheme includes 'authorised officers' aS defined in s. 3 (5) of the Ceiling Act. The rest of the infra· structure for implementation of the statutory scheme is not material foc our case nor the other chapters relating to compensation, exemptions and the like Chapter XI provides for appeals and revisions and the High Court, by virtue of s. 83 read with s. 115 of the Code of Civil Procedure, has jurisdiction to entertain revisions against orders of Land Tribunals which enjoy appellate powers over orders of authorised officers in the manner provided. The present appeals are against common order of the High Court allowing several revision petitions under s. 115 C.P.C.

N0w, the respondents before us in the several appeals are persons whose transfers have been held void by the authorised officer and the land Tribunal but upheld by the High Court on narrow construction of s. 22 of the Ceiling Act. The alienations took many fonns ranging from stridhana tu bona fide sale but shared one common attribute that they were executed during the suspect spell, if one may say so, between the date of commencement of the Act and the notified date. The legislature, in its realistic anxiety and pragmatic wisdom, demar-cated lethal zone viz., the period between the two dates stated above when all landholders with lands in excess of the ceiling would des-perately salvage their surplus by resort to devices, some bona fide, some not, but all having the effect of frustrating the legislative objective of freezing holdings as on the date of commencement of the Act and seizing the surplus in terms of the Act for eventual equitable distri-bulion, after payment of statutory compensation.

Before embarking on any further discussion of the project of inter-dieting transfers, as spelt out in s. 22, we may read the provision :

"Where on or after the date of commencement of this Act, but before the notified date, any person has transferred any land held by him by sale, gift (other than gift made in contemplation of death), exchange, surrender, settlement or in any other manner except by request or, has effected partition of his holding or part thereof, the Authorised Officer within whose jurisdiction such land, holding of the major part thereof is situated may, after notice to such person and other persons affected by such transfer on par-tition and after such enquiry as he thinks fit to make declare the transfer or partition to be void if he finds that the transfer or the partition as the case may be, defeats any of the provisions of this Act."

Three semantic alternatives compete for judicial acceptance. The first, which appealed to the Land Tribunal is that all alienations during the dubious period specificated in s. 22, if executed by holder who, but for such shedding operation or alienation, would have had lands in excess of the ceiling prescribed by the Act, are void because they are sure to defeat the 'surplus' provisions of the Act. The second alternative, which swings to the other extreme but has met with the High Court's approval, virtually salvages all such transfers save sham and mala fide ones, for only if they are obnoxious in that sense can they be caught in the coils of s. 22. The third possible con-struction, which is in between the two extremes and has been force-fully pressed before us by Shri K. S. Ramamurthy, validates bona fide transfers even during the offending period, the reason being that regardless of thdr impact on the scheme of the Act or its provisions, the primary object is bona fide fulfilment of the alienor's purposes such as discharge of pressing debts or borrowing to perform necessitous obligations and not to defeat or thwart the purposes or provisions of the Act.

The judicial choice from among these triple possibles depends on the rules of statutory interpretation. In the present case the basic facts are beyond dispute. The legislature had defined plan of pro-viding for ceiling on land holding, taking over the balance and dis-tributing it among the landless according to priorities. In this pers-pective it defined the "date of the commencement of this Act in s. 3(11) Its meaning the 15th day of February, 1970. It also defined in s. 3(31) the notified date. As stated earlier, the Ceiling Act had

chequered caree.r in court and, indeed, at one stage the whole Act was struck down as unconstitutional. However, now it is immune to attack having been included in the Ninth Schedule and there is no challenge to its vires before us. On account of extensive mischief done by alienations on co!'sider~ble scale calculated to undo the public policy behind agrarian reform the legislature felt the necessity to provide in s. 22 that transfers made between 6-4-1960 and 2-10-1962 would be void if they defeated the provisions of the Act. In all the cases before us the transfers which have been ignored by the Authorised Officer fall within this interregnum. That being ad-mitted, the only question is whether the lethal effect of s. 22. operates only in the case of transfers which are sham and specifically intended to defeat the Act or does not affect transfers which are otherwise bona fide or is so pervasive that if the effect of the transfer is to defeat the provisions of the Act, whatever the intent of the parties, the transfer is void and can be ignored vis-a-vis the Ceiling Act and the Authorised Officer may legitimately proceed to compute the surplus a'rea on this basis.

The learned judge adverted to an argument that the Act being confiscatory one, the public authority "invested with the power to enquire into and to invalidate transfer should act reaspnably, and that such power should be construed beneficiently in favour of the subject who is affected by the statute (emphasis added). This approach, sanctified by tradition and vintage jurisprudence, is inept and inapplicable when we consider agrarian reform legislation whose avowed purpose is to take away as much extent of land as policy dictates so that distribution thereof among the landless may be achieved. When whole legislation is geared to deprivation of property, subject to payment of compensation, rules which have frowned upon confis-catory legislation cannot apply at all. We are concerned with Re-public created by the people of India, with social transformation where the State is 'not antagonistic to the cti7,en but harmonises individual interest with community good. The jurisprudential prin-ciples in such situation cannot be the same as have been inherited from culture which postulates the State versus the subject. We do not explore the aspect df the law further as we are satisfied that the answer to the specific question raised before us flows directly from reading of the Section in the light of we11-established rules of inter-pretation.

Section 7 is key provision and runs as follows :

"On and from the date of commencement of this Act, no person shall, except as otherwise provided in this Act but

. AUTHORISED OFFICER v. s. N. AYYAR (Krishna Iyer, J.) 1127

subject to the provisions of Chapter VIII be entitled to hold laud in excess of the ceiling area;

Provided that in calculating the total of land held by any person, any extent in excess of the ceiling area and not exceeding half an acre in the case of wet land and one acre in the case of dry land shall, irrespective of the assessment of such land, be excluded."

\, Section 8 directs every person who holds land in excess of 30 , _ ,i(_ standard acres to submit return with specified particulars. Section 18 ' is the culmination and provides for the publication of notification to the effect that the surplus land with each landholder is required for public purpose. Thereupon such land shall be deemed to have been acquired for public purpose and shall vest in the Government.

Chapter III is protective armour created by the statute with pro-hibitions and proscriptions. In particular, s. 22, which we have quot-ed earlier, contains an interdict. If any transfer, contrary to its tenor, is createtl it ca·n be voided by the Authorised Officer. The whole purpose is to make available land with Government for its equitable dispensation according to the statutory plan. Section 94 is relevant in this context. 6-4-1960 is the date of commencem"nt of the Act. 2-10-62 is the notified date. Transfers in between these two dates have been execut-ed by the respondents in the various appeals before us. The concrete question is whether s. 22 has the effect of rendering such transfers in-valid ipso facto or whether there is need for further proof that such transfers are "sham, nominal and bogus''. The view taken by the High Court is that :

" ... Section 22 seems to cover only those sham,· nominal and bogus transfers which are only inte'nded to defeat the provisions of the Act. If the Legislative intention is also to invalidate all bona fide transactions during the relevant period, it would have made certain consequentia1 pravi-sions as to what arc the rights of the transferor and the transferee in relation to the property conveyed, and how the resultant equities between th~ transferee and the transferor have to be worked out. This view that section 22 will cover only transactions of sham, nominal and bogus character which are intended only to defeat the provisions of the Act will not be inconsistent with the object provided in section 7."

The learned judge seems to take liberal view that transactions entered into in anticipation of the Ceiling Act will not be hit by the provisions preventing such transfers except where they are 1JID/a fide or colourable. The reason partly turns on semantics and the conrt argues with lexical support:

"The word "defeat" normally means overcome, thwart, evade, frustrate, circumvent, bypass, disappoint, prevent, the accomplishment of the word "defeat" in Section 22 is one to be taken as having been used to import sinister, motive. Maxwell on the interpretation of statutes, twelfth edition, after stating that the Courts will not be astute to narrow the language of statute so as to allow persons within its pur-view to escape its net, that the statute has to be applied to the substance rather than the mere form of transactions thus defeating any shifts and contrivances which parties may have devised in the hope of falling outside the Act."

The conclusion categorically reached by the High Court virtually emasculates s. 22 as we understand its object and import. The learned judge winds up with these words: "On due consideration of the matter, I hold that under section 22 of the Act the authorised officer is entitled to declare as void only those transfers which are sham and nominal entered into with the avowed object of defeating the provisions of the Act, without any bona fide intention to transfer title. So in the light of the view expressed above the facts of each case have to be considered.'' Section 22, literally read leads only to one conclusion, that any transfer, bona fide executed or not, is liable to be declared void by the Authorised Officer "if he finds that the transfer defeats any of the provisions of this Act." There is not the slightest doubt that severally and cumulatively the provisions of the Act seek to make available the maximum extent of land, in excess of the ceiling, to be vested in Government for fulfilment of its purposes. Chapter II contain\; fasciculus of provisions in this behalf and if any transfer carves out of the surplus area some land, pro tanto, the provisions of the Act are defeated. Indeed, it is not seriously disputed that such will be the conclusion if we do not read into the provisions either the condi-tion that it does not apply to bona fide transfers, as Shri Ramamurthy would have it, or does not apply to any transfers other than sham, nominal or bogus transfers, as the High Court would have it. policy-oriented interpretation tallies with the literal construction in the

present case. The mischief rule in Heydon's case and the grammati-cal construction which is the Golden Rule converge to the same con-clusion in the present case.

The policy of the law of land reform with drastic limit on hold-ings often drives large holders to evade by manouvres. They make gifts, execute sales or settlements, enter into other dealings to save their properties from being taken by the State. May be in few cases, the ow'ner has real necessity. Bnt why sell only on !he eve of land legislation? Why execute deeds, !hongh for good purposes, only where the bill fixing ceilings is round the corner? By a'nd large, the strategies of extrication of holdin!11' from the arm of the law is the reason that prompts sudden affection for making gifts, sudden realisa-tion of debts due and sudden awareness of family necessity. The legislature, astute enough not to be outwitted in its objective, puts blanket ban on transfers wbich, in effect, Cb~feat its provisions. This may cause hardship to some but every cause claims martyrs. Indi-vidual trauma is inevitable while ushering in new economic order. This is the rationale of s. 22 of the Ceiling Act. To alloy the sense of the text and to mix alien concepts is to debase the statutory metal. Likewise, laws are not value-free and so he reads the symbols of words best who projects i'n the process the values of the legislation as dis-tinguished from his own. Reading other valuos into the legislators' words may judicially demonetize the statute and break the comity bet-ween constitutional instrumentalities.

The current and correct view of the interpretative process is that words must be given their 'literal' or 'ordinary' meaning· unless there are compelli'ng reasons, recognised by canons of construction, to the contrary. It must be remembered that the jndicial rule of law for interpreting statutes applies the grammatical approach, thereby to bring out the value judgment incorporated in the statute itself. Some times it is called the 'equity of the statute'. As Prof. R. B. Stevens of the Yale University bas pointed out:

"Whenever the judges support to depart from the literal or ordihary meaning, and apply the mischief ru~e or the gol-den rule, there is danger that in place of those irrelevant cri-teria, the canons of construction, they have more obviously substituted their own (perhaps more harmful) impressions views, prejudices or predispositions. Such conflicts betwee~ what Parliament intended and what the judges asi;umed Par-liament to have intended have long bt"Clll appreciated."(') (l) Modern Law Review, Vol. 28, 1%5, p. 525. 16--409 SCI/79

Those who have reflected on the meaning of meaning have said that words. . . . "mean" nothing by themselves .. ('). They convey policy and the judge who interprets must seek the intent of the legis· lature by gaining an insight ihto this policy and making it manifest through the process of construction. Looking at the words of s. 22 in the light of the scheme of prohibition of transfers to preserve the surplus lands for distribution, we find no justification for importing into s. 22 more than its words convey. The Section says what it means, nothing more, nothing else. simple scan of the provision reveals that any transfer, gift, surrender, settlement or other alienation referred to in the Section may be declared void by the Authorised Officer "if he finds that the transfer or the partition .... defeats any of the provisions of this Act.". The trichotomy is obvious. There must be transfer or other alienation. It must have taken place during the period mentioned in the Section. It must have the effect of defeating any of the provisions of the Act. If these three elements are present, the Authorised Officer must void the transfer. There is no room for importing fourth principle that the transfer should be 'sham, nominal or bogus'. Nor indeed is there any additional consi-deration that if the transfer is bona fide for family necessity or oth·~r urgency then it is good, even though it defeats the provisions of the Act. We cannot amend the Section or dilute its imperatives, scared by the consequences or moved by extraneous sympathies. Sub-cons-cious forces and individual prepossessions have subtle way of entering the interpretative verdict of the judge. We have to be constantly careful to exclude such intrusions. Moreover, when the whole purpose of the Section is to prevent any alienation which defeats any of the pro-visions of the Act, it is impermissible to introduce any requirement, other than is mentioned in the Section, as condition for its operation. Obviously, the provision seeks to provide social justice for the land-less and it defeats the purpose if, by the interpretative process, soft justice to large landholders is brought about. We consider the 'literal' meaning of the Section to be that any transfer or other aliena-tion mentioned in the Section which reduces or impairs the otherwise available extent of surplus land beyond the ceiling "defeats ...... the provisions of this Act." This is the plain meaning of the Section which gives no room for doubt or justiftcation for importation of any further condition like sham, bogus elc.

return to the rules of strict construction, when the purpose of

(I) C. Ogden and I. Richards, The Meaning of Meaning 9 (10th Edn. 1956)

the statute needs it, is desirable, especially with view to give effect to the intention of the legislature. We are reminded of Lord Denning's interesting remarks in his recent book "The Discipline of Law" under heading "I am Portia Man".

In justification of his view Russe]] Ll quoted passage from Shakespearo. It is worth recording becausv there are lessons to be drawn from it-as there often are from Shakes-peare.

'I may perhaps be forgiven for saying that it appears to me that Lord Denning MR has acceded to the appeal of Bessanio in the Merchant of Venice.

Bessanio

"And, I beseech you,

Wrest once the law to your authority: To do great right, do little wrong."

But Portia retorted : "It must not be; there is no power in Venice Can alter decree established : It will be recorded for precedent, And many an error, by the same example, Will rush into the State : it cannot be." Then said Russell LJ.

'I am Portia man'.

I cannot believe that Russell Ll wonld be 'Portia man' if it meant aligning himself with Shylock-in support of strict law of penalties which could not be relieved by equity.

To be truly 'Portia man' the lawyer should follow the way in .. which Portia avoided an unjust decree. Not to let the words of the • deed be the masters: but so construe them--<ldapt them as the occa-G sion demands-so as to do wha.t iustice and equity require. This is how she turned the tables on Shylock:

It is in this denouement that I would follow the example of Portia-I too am Portia man.

In the interpretation of s. 22 we too are Portia men. For this reason we reverse the view of the High Court that s. 22 will not apply to nullify any transaction of transfer or partition unless it is further

For this

[1979] 3 S.C.R.

shown that it is sham, nominal or bogus. Nor do we' agree with Shri Ramamurthy that even if transaction defeats the ceiling provisions, it may still be valid if the transfer is, from an individual point of view, bona fide. The short reply is that from the cormnnnity's angle, espe-cially the landless community's angle hungering for allotment, the alienation, however necessary for the individual, is not bona fide vis-B a-vis the cormnunity.

Therefore, we allow the appeal in the light of the interpretation we have adopted, restore the tribunal's holding and rule that if any transfer defeats the provisions of the Act by reducing the extent of sur-plus land in excess of the ceiling available from any person such trans-action bona fide or not, is void in the matter of computaticm of the · permissible a~ea and the surplus area. May be, that the transaction may be good for other purposes or may ilot be. The Authorised Officer is within his power if be ignores it as void for purposes of s. 22, s. 7 and other ceiling-related provisions.

The detailed discussion of the High Court on many other aspects of the Act do not affect the core of the matter and cannot deflect us · from the conclusion we have arrived at. The appeals are allowed but in the light of the earlier direction of the Court. the State. will pay the costs of the respondent.

__.M._. r

Appeal allowed.