J&K Land Revenue Act | Financial Commissioner's Suo-Moto Power Conditional On Hearing, Can't Modify Orders Without Giving Opportunity To Parties: High Court

Citing Sec 15 of the Act a bench of Justice Javed Iqbal Wani clarified,

“Though there is no dispute qua the suo-moto power of revision available to the Financial Commissioner in a particular case, yet, it cannot be lost sight of that such power, as has been noticed in the preceding paras is to be exercised subject to a caveat that in the course of exercise of such power, a proceeding or an order affecting any right of a party would get reversed or modified the party to be effected had to be provided an opportunity of hearing”.

Background of the Case:

The case involved Mst Khalida, who had a mutation (record of change in land ownership) attested in her favor in 1996. This was challenged by Mohammad Ramzan Ganai before the Collector/Additional Deputy Commissioner Budgam in 2013. The Collector allowed the appeal, finding the mutation to be illegal.

Khalida then filed a revision petition with the Financial Commissioner (Revenue), who set aside the Collector's order but also cancelled the mutation on grounds that it violated the Jammu and Kashmir Agrarian Reforms Act, 1976. However, the Financial Commissioner did not provide Khalida with an opportunity to be heard on this point.

Khalida challenged the Financial Commissioner's order in the High Court, arguing that she was not given a chance to defend herself against the application of the Agrarian Reforms Act. The opposing party, Mohammad Ramzan Ganai, defended the impugned order, arguing that the appellate forum had validly set-aside the mutation in question while holding that said mutation to have been attested in contravention of provisions of law.

Court Observations:

The Court, relying on Section 15 of the J&K Land Revenue Act, 1996, acknowledged the Financial Commissioner's suo-moto revisional power. However, it emphasised a crucial caveat that this power cannot be used to alter proceedings or orders affecting a party's rights without providing them an opportunity to be heard.

“A bare perusal of the provisions of Section 15 Supra would tend to show that the said power is exercisable by both the Financial Commissioner (Revenue) as well as the Divisional Commissioner, however insofar as the exercise of such power by Financial Commissioner (Revenue) under sub section (1) or (3) the said power is to be exercised with a caveat incorporated in the proviso…that the Financial Commissioner shall not under the Section pass an order reversing or modifying any proceedings or order of a subordinate officer affecting any question of right between private persons without giving those persons an opportunity of being heard”, the bench underscored.

Justice Wani, citing the Supreme Court judgement in Dharampal Satyampal Limited Vs. Deputy Commissioner of Central (2015), reiterated the importance of natural justice principles, including audi alteram partem (the right to be heard) and held that the Financial Commissioner's failure to follow this principle amounted to a "flagrant violation" and rendered his decision on the Agrarian Reforms Act inapplicable.

Applying the said position of law to the case at hand the bench noted that the FC while deciding the revision petition on the basis of the respective pleadings of parties as also the record available before him held the mutation to have been attested in accordance with law and in presence of the respondent herein.

It however pointed out that while exercising a suo-moto revisional power to set-aside the mutation in question on the ground of applicability of Section 31 of the Agrarian Reforms Act, 1976 without framing any issue thereof and without affording opportunity of hearing of the parties in general and the petitioner herein in particular being a party likely to be affected by setting-aside of the mutation in question was a complete departure from what the law prescribes.

“In the instant case the Financial Commissioner has made a complete departure while exercising suo-moto revisional power in the matter while setting-aside the mutation in question attested in favour of the petitioner herein without providing an opportunity of hearing to the parties”, the bench remarked.

In light of these observations, the High Court partially quashed the Financial Commissioner's order. The mutation cancellation based on the Agrarian Reforms Act was set aside, and the case was remanded back to the Financial Commissioner for reconsideration.

Case Title: Mst Khalida Vs Financial Commissioner (Revenue)

Citation: 2024 LiveLaw (JKL) 111

Mr. R. A. Jan, Sr. Advocate with Mr. Suhail Mehraj, Advocate appeared for the petitioner, Mr. N. A. Kuchai represented Respondent 5

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