Holding

A sham gift deed cannot be used to exclude the land from the appellant's holdings; the surplus land is computed as if the transfer never occurred.

Summary

The appellant, Dilawar Singh (deceased) through his legal representatives, filed a return under Section 10(2) of the U.P. Imposition of Ceiling on Land Holdings Act, 1960, claiming that he had gifted several parcels of land to his grand‑nephew. The Prescribed Authority and the lower appellate court held that the gift deed was a sham transaction intended to evade the ceiling prescribed under Section 5 of the Act, and therefore the lands could not be excluded from his holdings. The High Court affirmed this finding and dismissed the appellant's petition. On appeal, the Supreme Court examined whether a sham gift deed could be treated as a valid transfer for the purpose of computing surplus land and whether the ratio in Ramdhar Singh v. Prescribed Authority applied. The Court held that a sham document has no legal existence; the excess land must be computed as if the transfer never occurred, and the lands cannot be excluded from the appellant's holdings. Consequently, the appeal was dismissed.

Issues considered

Whether a gift deed that is a sham transaction can be treated as a valid transfer for the purpose of excluding land from the ceiling computation under Section 5 of the U.P. Imposition of Ceiling on Land Holdings Act, 1960.
Whether the ratio in Ramdhar Singh v. Prescribed Authority & Ors. (1994) Supp. 3 SCC 702 is applicable to the present facts.
Whether Section 5(6) of the Act permits exclusion of lands transferred by a sham gift deed.

Subjects

land ceilingsham transactiongift deedsurplus land computationSection 5Section 10(2)Uttar PradeshU.P. Imposition of Ceiling on Land Holdings Acttransfer after 20 August 1959exclusion from holdings

Judgment

A DILAWAR SINGH (DEAD) THROUGH LRS.
v.
ADDL. DISTRICT JUDGE, GHAZIABAD

SEPTEMBER 13, 1995

B [K. RAMASWAMY, B.P. JEEVAN REDDY
AND B.L. HANSARIA, JJ.]

U.P. Imposition of Ceiling of Land Holdings Act, 1960 : Sections 5,
10(2).
c
Swplus ceiling area-Computation of-{;ift of land-Sham transaction
to avoid ceiling imposed-Lands covered by gift deed held not to be excluded
from landowners holdings.

In response to a notice issued under Section 10(2) of the U.P.
D Imposition of Ceiling on Land Holdings Act, 1960, the appellant filed his
return wherein he mentioned that he gifted certain lands to his grand-
nephew. The Prescribed Authority as well as the First Appellant Court held
that the gift was a Sham transaction to avoid the ceiling im,Posed under
Section 5 of the Act, therefore, the lands covered by the gift deed were not
E to be excluded from the holdings of the appellant. The High Court also
dismissed the petition filed by the appellant.

In appeal to this Court on the question whether the appellant was
entitled to have the lands covered under the gift deed excluded from his
holdings:
F
Dismissing the appeal, this Court

HELD: Section 5 of the U.P. Imposition on Land Holdings Act, 1960
postulates that on and from the date of its enforcement, no tenure-holder
shall, except as otherwise provided by this Act, be entitled to hold an area
G in excess of the ceiling area applicable to him, notwitbstanding anything
contained in any other law, custom or usage for the time being in force,
or agreement, to the contrary. When the Act had come into force and
declared that any transfer or partition effected on or after the twentieth
day of August, 1959 shall be ignored and shall not be taken into account,
H the statutory provision required that the excess land shall be computed as
630
•

DILAWAR SINGH v. ADDL. DISTI. JUDGE 631

- if the land held by the declarant on or before the twentieth day of August,
1959 was not affected by virtue of any transfer or partition effected
A ·

thereafter, and surplus shall be computed, despite such transfer. In view
of the finding recorded by the courts below that the gift deed was a sham
document in law, it does not have any existence which binds the Govern-
ment in determining the surplus area. Since it was a sham document, the B
validation of any transfer or partition effected on or after January 24, 1971
is of no avail to the appellant. (632-F-H, 633-A-B]

Ramdhar Singh v. Prescribed Authority & Ors., (1994) Supp. 3 SCC
702, held inapplicable.

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2234 of
c
1979.

From the Judgment and Order dated 10.11.78 of the Allahabad High
Court in C.M.W.P. No. 522 of 1978.

Ravindra Bana, for the Appellants D

R.C. Verma, Ms. Reena Jain for AK. Srivastava for the Respondent.

The following Order of the Court was delivered :

Pursuant to the notice under s.10(2) of the U.P. Imposition of Ceiling E
on Land Holdings Act, 1960 (for short, 'the Act'), the appellant had
submitted his return. Therein he had stated that on May 6, 1965, he had
gifted under Khasra No. 266 eighteen biswas 'Pukhta', under No. 613 two
bighas, seven biswas and ten biswansis; under No. 616 three bighas, sixteen
biswas and six biswansis etc. etc. All the authorities concurrently found that
the gift is a sham transaction to avoid the ceiling imposed under s.5 of the F
Act. The, High Court in its order dated 10.11.1978 made in C.M.W.P. No.
522/78 dismissed the petition agreeing with the finding thus :

"In my view, the Prescribed Authority and the Court below which
affirmed the decision of the Prescribed Authority on the controver- G
sy have recorded findings which cannot be said to be vitiated by
any jurisdictional error. They were entitled to reach their own
conclusion and this court in its writ jurisdiction cannot substitute
its own judgment for the decision of the Prescribed Authority on
the ground that the said decision or the judgment of the lower
appellate court should not have been so pronounced on the basis H
632 SUPREME COURT REPORTS (1995) SUPP. 3 S.C.R.

A of material and evidence on the record. The next point urged was
that plot no.992 is Abadi land. Again, I find that the
necessary discussion is there in the order of the Prescribed
Authority and in the judgment of the lower appellate court and
a finding of fact has been recorded which cannot be disturbed in
the writ jurisdiction."
B
Mr. Ravindra Bana, learned counsel for the appellant, contended
that in view of the decision of this Court in Ramdhar Singh v. Prescribed
Authority and Ors., {1994) Supp. 3 SCC 702, the land covered by the gift
deed needs to be excluded by operation of s.5(6) of the Act. Mr. R.C.
C Verma, learned counsel appearing for the State urged that initially the
notified date which the statute had prescribed was August 20, 1959. Since
the appellant had not submitted his return for computation of the surplus
ceiling area, notice under s.10(2) came to be issued. Therein, he had come
with the plea that he had gifted the land to his grand-nephew. Since the
D court below and the High Court had found, as a fact, that the transaction
of gift was a sham one, it must be construed as if there was no alienation
or that it was intended to defeat the provisions of the Act. Therefore, the
Amendment Act cannot be applied in the circumstances. In that view, the
ratio of Ramdhar Singh's case (supra) does not apply to the facts in this
case.
E
The question for consideration is whether the appellant is entitled to
have the lands covered under the gift deed excluded from his holdings. If
the gift deed is accepted to be valid one, his holding would be within the •.
ceiling limit prescribed by Section 5 of the Act. But Section 5 of the Act
F postulates that on and from the date of its enforcement, no tenure-holder
· shall, except as otherwise provided by this Act, be entitled to hold an area
in excess of the ceiling area applicable to him, notwithstanding anything
contained in any other law, custom or usage for the time being in force, or
agreement, to the contrary. In determining the ceiling area applicable to a
tenuie-holder at the commencement of this Act any transfer or partition
.G of land made after the twentieth day of August, 1959, which, but for the
transfer or partition would have been declared surplus land under the
provisions of this Act, shall be ignored and not taken into account. It would
thus be dea:r that when the Act had come into force and declared that
any transfer or partition effected on or after the twentieth day of August,
H 1959 shall be ignored and shall not be taken into account, the statutory
DILAWAR SINGH v. ADDL. DISTI. JUDGE 633

provision required that the excess land shall be computed as if the land A
held by declarant on or before the twentieth day of August, 1959 was not
affected by virtue of any transfer or partition effected thereafter, and
surplus shall be computed, despite such transfer. In view of the finding
recorded by the courts below that the gift deed was a sham document in
law, it does not have any existence which binds the Government in deter-
mining the surplus area.
B

In view of the finding that it is a sham document, the validation of
any tr an sfer or partition effected on or after January 24, 1971 is of no avail
to the appellant. The ratio in the above case has no application to the facts
of the case. The appeal is accordingly dismissed. No costs. C
T.N.A. Appeal dismissed.