Bombay Tenancy & Agricultural Lands Act | Trust Land Must Be Included In Schedule-I To Claim Exemption, Order U/S 88B Insufficient: High Court
The Bombay High Court has held that an exemption order granted to a Trust under Section 88-B of the Bombay Tenancy and Agricultural Lands Act, 1948 (BT&AL) is not sufficient to claim exemption of the land from the provisions of the Act. The land must be included in Schedule I of the BT&AL Act to claim such exemption.
The Court also observed that Section 32-G of BT & AL is a deeming provision and vests title of the land being cultivated by a tenant as on 'tillers day' (01.04.1957) and thus any subsequent exemption granted to the trust will have no effect on the tenant's rights.
Background of case
Justice Avinash G. Gharote was considering the petitioner's challenge to the order of the Maharashtra Revenue Tribunal (MRT), setting aside the order of the Sub Divisional Officer (SDO).
The SDO had set aside the order of the Agricultural Lands Tribunal (ALT), which had held that respondent No.1 was a tenant in respect of land bearing Survey No.73/1 and therefore entitled to purchase the same under Section 32G of the Bombay Tenancy and Agricultural Lands Act. Section 32-G provides for ALT to issue notices and determine the price of land to be paid by tenants.
The petitioner-trust contended that the land in question was its property, which was exempted by an order dated 30.05.1959 passed by the Deputy Collector under Section 88-B of the BT&AL Act. Section 88-B exempts properties belonging to a trust from certain provisions of the Act if such trust was registered under the Bombay Public Trusts Act, 1950 and the entire income of such land is appropriated for the purposes of such trust.
The land in question, Survey No. 73/1, originally belonged to the petitioner-trust. However, 01.04.1957, the land was deemed to have been transferred to the tenant, Mahadeo Padu Gaikwad, under the provisions of the Bombay Tenancy and Agricultural Lands Act. This transfer was due to the statutory mandate that tenants became deemed owners of the land they cultivated on the “tillers' day” (April 1, 1957). The original tenant, Mahadeo Padu Gaikwad was in cultivating possession on the tillers day and later his legal heirs were in cultivating possession.
The question before the Court was whether the ownership of the land was affected by the subsequent exemption granted by the Deputy Collector to the trust on 30.05.1959 under Section 88-B of BT&AL Act.
Exemption under Section 88-B of the BT&AL Act
The Court noted that a certificate under Section 88-B of the BT&AL Act was granted to the petitioner-trust on 30.05.1959 by the order of the Deputy Collector.
However, this exemption was objected to by the respondents on the grounds that it is contrary to the requirement of proviso (ii) of Section 88-B(1), which provides that the entire income of the lands should be appropriated for the purposes of such trust.
An order dated 10.11.1952 by the District Judge framed management of the petitioner-trust from clauses 14(a) to (c), which contemplated that 1/3rd of the income of the petitioner-trust was to be used for the benefit and welfare of the descendants/legal heirs of the original settlor Mr. Yakub Baig.
The Court remarked the decision of the District Court was never challenged. It remarked, “What is material to note is that this clause has never been questioned and continues to be operative and effective even today…”
It stated that even though the contention of respondents would be correct considering clauses 14(a) to (c) set by the District judge, the Court however noted that the order dated 30.05.1959 had not been set aside to date. Thus, the exemption granted by the order would continue even today in view of Section 88-B (2) of the BT&AL Act, which provides that the certificate issued by the Collector under Section 88-B (1) would be conclusive evidence that the conditions in the proviso to Section 88-B (1) are satisfied by any trust.
It noted that once an exemption is granted under Section 88-B, the tenant would not be entitled to apply for determining the purchase price under Section 32-G.
Exempted property must be included in Schedule I of the BT&AL Act
The Court noted that for a property to be included in the exemption order, it has to first be included in Schedule-II of BT&AL Act. Here, it observed that the exemption order under Section 88-B was granted to the petitioner-trust on 30.05.1959, however, the inclusion of land of Survey No. 73/1 was done on 24.07.2019.
It thus held “Thus it can safely be said that even if the land of Survey No. 73/1, belongs to the petitioner-trust, the same is not covered under the exemption granted in favour of the petitioner-trust by the order dated 30.05.1959...”
Section 32-G of BT & AL is a deeming provision
The respondents argued that even presuming the exemption was granted to the land of Survey No. 73/1, it would not affect the tenant as the deemed date of transfer in favour of the tenant was 01.04.1957 (i.e. tillers day).
The Court stated that Section 32-G of BT & AL vests title in the land being cultivated by a tenant as of 01.04.1957 (tillers day). As 32-G is a deeming provision, the vesting of land is thus complete on the tillers day and any subsequent exemption granted to the Trust would not affect the tenant's rights.
“A perusal of the language of Section 32-G of BT & AL Act indicates that it is a deeming provision and by a statutory mandate vests title in the land being cultivated by a tenant, in the tenant, as on 01.04.1957. On account of the deeming provision of Section 32-G of BT & AL Act the vesting is complete on 01.04.1957, and the provisions of the tenant applying for determination of the purchase price and grant of a certificate under Section 32-M of BT & AL Act are consequential to such vesting.”
In the present case, the Court noted that the petitioner-trust was registered under the Act and an exemption was granted on 30.05.1959. However, as the land of Survey No. 73/1 was not included in Schedule-I, the petitioner-trust is not entitled to claim that the land stood exempted under Section 88-B.
The Court thus upheld the order of the MRT and ALT, which allowed the application of the tenant (respondent no.1) for fixing the purchase price under Section 32-G of the BT&AL Act.
Hence, the Court dismissed the plea of the petitioner-trust.
Case title: Yakub Baig Trust Panvel Erstwhile Mominpada Masjid Yakub Baig Trust vs. Ganu Mahadu Gaikar & ors. (WRIT PETITION NO. 3497 OF 2024)