Holding

The Court ordered the disputed land to be divided equally, granting one half to the appellant as the bona fide auction purchaser and the other half to the second respondent under Rule 34C.

Summary

The appellant, a retired army subedar and displaced person, bought a 7‑kanal parcel of land in a public auction in 1967 and was issued a sale certificate in 1973, making him the legal owner under the Displaced Persons Compensation and Rehabilitation Rules. The second respondent, also a displaced person, claimed continuous possession of the same land as a sub‑lessee/sub‑tenant since 1956 and sought allotment under Rule 34C of the Rules. After a series of applications, revisions and a civil decree declaring his possession, the Financial Commissioner in 1988 set aside the auction sale and allotted the land to the second respondent, prompting the appellant to appeal. The Supreme Court examined whether the auction sale and the sale certificate conferred indefeasible title, and whether Rule 34C could override that title. It held that both parties had legitimate equities and, rather than overturning either claim, ordered the land to be divided equally, giving each party a half. The appeal was allowed.

Issues considered

The effect of a sale certificate issued under Rules 90 and 92 on the title of a bona fide purchaser at public auction.
Whether a claim for allotment under Rule 34C based on continuous possession can defeat the title of an auction purchaser.
Whether the Financial Commissioner erred in setting aside the auction sale and awarding the land to the second respondent.
Appropriate remedy to balance the competing rights of the auction purchaser and the long‑time possessor.

Legislation cited

Code of Civil Procedure, 1908s. 9
Displaced Persons (Compensation and Rehabilitation) Act, 1954s. 14, s. 15, s. 20, s. 27
Registration Act, 1908s. 89

Subjects

Displaced personsLand auctionBona fide purchaserRule 34CContinuous possessionEquitable divisionCompensation poolSale certificate

Judgment

GURBAX SINGH S10 CHANDA SINGH
A
v.
FINANCIAL COMMISSIONER AND ANR.

SEPTEMBER 21. 1990

B [S. RANGANATHAN AND K.N. SAIKIA JJ.]

Displaced persons Compensation & Rehabilitation Act 19541Dis-
placed persons Compensation and Rehabilitation Rules 1955-Sections
14, 34C/Rules 34C, 34H and 92-Allotment of agricultural land-Bona
fide purchaser of la.nd at public auction-Right of
c The appellant, a retired army subedar and also a displaced person
from west Pakistan purchased the Land in public auction conducted by
The Rehabilitation Department, by offering the highest bid of
Rs.9,500. The land in dispute measured 7 Kanals & 4 Marlas and was
owned by one Vinod Kumar. Having paid the purchase money with the
D sincere hope of his rehabilitation, he had to be in protracted litigation
for 22 years during which he earned nothing out of the land because the
State did not honour its fmal commitment made in the sale certificate in
favour of the appellant. The· State confirmed the sale in favour of the
appellant in 1969 but issued sale certificate on 23 June, 1973 being
effective from Sep.tember 15, 1969 without waiting for the fmal out
E come of the second respondent's revision application to the Chief Settle-
ment Commissioner, and further consequent proceedings thereon.

It was submitted by the second respondent that the said land was
in his cultivatory possession since 1956 and as per public records he was
sub-lessee under Budha Singh Lessee, and the Lease in favour of Budha
F Singh was cancelled in 1958 by the Rehabilitation Department and
thereafter he became a sub-tenant holding over on the date he applied
for allotment in 1961, under Rule 34C of the Rules. The decision reject-
ing his first application was not commnnicated to him. So he made his
second application which was rejected by The Chief Settlement Officer
vide his order dated July 24th, 1969. Then he moved a revision applica-
G lion before the Chief Settlement Commissioner who remanded the case
to the Managing Officer for fresh decision by his order dated July 29,
1970. The second respondent's second application was rejected on
March 22, 1973. The second appeal to the Settlement Commissioner
was also rejected on May 13, 1973 as he could not prove his continuous
cultivatory possession as a sub-lessee under Budha Singh from January
H 1, 1956 till the termination of the latter's lease. Thereafter second

14
GURBAX SINGH v. FINANCIAL COMMR. 15

respondent institnted a suit against Budha Singh for declaration of his
A
continuous possession of the land and got a decree in his favour as heji\g
in continuous possession of the land. ·

The second respondent again filed a revision against the appellate
order of the Settlement Commissioner, which was remanded 'to the
Managing officer and he got land alloted under Rule 34C of the Rules B
vide order dated January 6th, 1978. The appellant's appeal therefrom
was dismissed by the Settlement Commissioner, but in his revision
application therefrom, the allotment order iri favonr of the .second
respondent was quashed by the Chief Settlement Commisioner vide his
order dated January 1, 1979 declaring the appellant to be the ?Uction
purchaser and therefore the true owner of the Land. The second respon-
dent's revision was rejected by the Financial Commissioner on Oct. 23, c
1979. Thus all authorities in th~ successive rounds found the facts
against the second respondent.

· Therefore, the second resondent filed a writ petition challenging
the Financial Commissioner's order in the High Court. High Court D
remanded the case to the Financial Commissioner for fresh decision on
January 7, 1983. The Financial Commissioner vide his order February
2, 1988 held that the second respondent was eligible for allotment of
land under rule 34C of the rules, holding that being a sub-lessee in
contilmous possession since January 1, 1956, and thereafter he had a
superior claim to the allotment of the land and qnashed the auction sale E
made in favour of the appellant on August 11, 1967.

The Financial Commissioner found that since 1953 to 1961 the
second respondent was in possession of the land and again in 1964-65,
65-66 the records also bore out this fact. The absence of records for
1961-62, 62-63 due to their illegibility due to mutilation should not he F
held against him and his continuous possession since 1962 can be pre-
sumed entitling him to an allotment under Rule 34 C of the Rules. This
was a conclusion on facts which the High Court declined to interefere
with and dismissed the appellant's writ petition in limine on August 24.
1988.
G
Allowing the Appeal, the Court,

HELD: In the insta.nt case, the appellant as a bone fide purchaser
of the disputed land for value at public auction under Rule 34H of the
rules on August 11, 1967 Should have been put in the same position in
which he would have heen, had_ his auction purchase as e\·idenced by the H
10 SUPREME COURT REPORTS [1990) Supp. 2 S.C.R.

Sale Certificate been effective from the date of purchase. Rule 90 of the
A
Rules prescribes the procedure for sale of property by public auction,
Sub-rule 15 of Rule 90 provides for issue of sale certificate and Rule 92
prescribes the proc1~dure for setting aside the sale, but once the sale
certificate was issued in favour of the appellant, he became the true
owner and it had the effect of taking away the land from pool of evacuee
B properties and thereafter so long that was not cancelled according to
law, it was not open to the Rehabilitation Department to deal with the
'ale. The difficulty in the present case has arisen because the State
confirmed the sale in favour of the appellant in 1969, whereas it is.sued sale
rertificate to him on June 23, 1973 with effect from September 15. 1969
without waiting for the final outcome of the second respondent's revi-
sion application to the Chief Settlement Commissioner & further pro- •I
c ceedings thereafter. Thus, the odd situation resulted in creating equities
in favour of both the parties with no fault of the appellant or the second
respondent. If the State had held over the auction until the second
respondent's application had been finally disposed of or had held the
auction subject to the result of the application, the second respondent
D could have challenged the auction in favour of the appellant but
perhaps misguidedly he was concentrating on getting an allotment
under section 34C. So both the parties had to suffer and indulge in
lengthy protracted litigation for 22 years. Had the Rehabilitation
authorities acting under the Act and the Rules decided the competin&
claims of the appellant as well as the second respondent as to the dis-
E puted land and provided an equal extent of land with equal benefits to
hoth the parties justice may appear to be done but that being uncertain,
the availibility of land being limited .. the court can only look towards
equity for solution. The delimma that equity is to be better than justice
and yet not quite opposed to justice but rather a kind of justice and the
distinction between commutative justice and distributive justice dis-
F cussed. [24E; F-H; 23G-H; 26B; 25C]
Passages from justinian, gustav Radbrach, Aristotle and Cardozo
referred to.
Considering the facts, the extent of land and the purposes of the
Act and the Rules and the reality that land must have become scarce
G and much more expensive than in 1967 to meet the ends of justice on the
basis of facts, the Court directed that the disputed land be divided by
the Financial Commissioner into two equal halves and one half and one
half be given possession of to the appellant by dint of his being auction
purchaser and the other half be allotted and given possession of to the
second respondent under Rule 34C of the Rules. This order be carried
H out accordingly within three months. [26C-D]
GURBAX SINGH '· FINANCIAL COMMR. ISAIK!A, J.] 17
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4718
of 1990. A
From the Judgment and Order dated 24.8. 1988 of the Punjab
and Haryana High Court in C.W.P. No. 7136 of 1985.
Dr. Rajeev Dhawan and Arun K. Sinha for the Appellant.
K.G. Bhagat, B.S. Malik and Ms. Galshan for the Respondents. B
The Judgment of the Court was delivered by
K.N. SAIKIA, J. Special leave granted.
This appeal is from the Judgment and Order dated August 24,
1988 of the Punjab and Haryana High Court dismissing the appellant's
writ petition for quashing the order of the Financial Commissioner c
Punjab dated 9.2. 1988 declaring the second respondent to be eligible
for allotment of the lands in dispute under Rule 34C of the Displaced
Persons Compensation and Rehabilitation Rules 1955 {hereinafter
referred to as 'the rules') framed under the Displaced Person Compen-
sation and Rehabilitation Act, 1954 (hereinafter referred to as ·the
Act'). D

The land in dispute (hereinafter referred to as 'the land') bearing
Khasra Nos. 17 /8/1, 8/2, and 8/4 admeasuring 7 Kanals 4 Marlas in the
Revenue Estate of Shanzada Nangal, Gurdaspur, was owned by one
Yinod Kumar. The second respondent claimed to have been in its
cultivating possession in the years 1953-54, 1956-57. In 1957-58 and E
1958-59 he was recorded as a sub-lessee under one Budha Singh lessee
on annual rent of Rs. 100. In 1958 the lease in favour of Budha Singh
was cancelled with information to him by the Rehabilitation Depart·
ment whereupon the second respondent's right as sub-lessee came to
an end. Consequently the second respondent was no longer recorded
as lessee or sub-lessee after 1958-59. f
In 1961 the second respondent applied to the Settlement Authority tor
allotment of the land under Rule 34C of the rules claiming as a >uh-
lessee. His application was rejected by the Managing Officer vide his
Order dated 25. 11. 1962 and the second respondent having not filed
any appeal or revision therefrom the order became final and binding
G
on him.
The Rehabilitation Authorities having decided to dispose of the
land an open auction was conducted on 11.8.1967 and the appellant, a
retired army Subedar and also a displaced person from West Pakistan.
offered the highest bid of Rs.9,500 (Rupee nine thousand five
hundered) which was accepted. The sale certificate was dulv issued by H
18 SUPREME COURT REPORTS [ 1990] Supp. 2 S.C.R.

A the Rehabilitation Department to the appellant with effect from
September 15, 1969. Without resorting to any- appeal against the
aforesaid Order dated 25.11.1962 refusing allotment of the land, the
respondent made a second attempt for allotment under Rule 34C of
the rules by making another application which too was rejected by the
Settlement Officer by order dated July 24, 1969 wherefrom the second
B respondent moved a revision application before the Chief Settlement
Commissioner who remanded the case by Order dated July 29, 1970 to
the Managing Officer for fresh decision but the latter rejected that
application also on 22.3.1973. The second respondent's appeal there-
from to the Settlement. Commissioner was also rejected by Order
dated' 13.5.1973 as the second respondent could not prove his conti-
C nlious cultivating possession as .a sub-lessee under Budha SinP,h from
1.1.1956 till termination of the latter's lease.

The second respondent thereafter instituted a suit on August 22,
1973 in the Court of Subordinate Judge, Gurdaspur against Budha
Singh for declaration of his continuous possession of the land. How- .
D ever, neither the appellant Who purchased the land in auction nor the
Rehabilitation Department which cancelled Budha Singh's lease was
impleaded. Budha Singh having supported the case, a decree declaring
the second respondent to have been in continuous possession was
passed.

E The second respondent this time filed a revisionfrom the appel-
late order of the Settlement Commissioner dated 13.5.1973 before the
Chief Settlement Commissioner who by his Order dated 5.11.1976
remanded the case to the Managing Officer for fresh decision. The
Managing Officer vide his order dated 6.1.1978 this time allotted the
land to the second respondent under Rule 34C of the rules. The appel-
F !ant's appeal therefrom to the Settlement Commissioner was dismissed
vide order dated 6.6. 1978 but his revision therefrom was allowed and
the allotment order in favour of second respondent was quashed by the
Chief Settlement Commissioner vide his Order dated 11.1.1979. The
Chief Settlement Commissioner declared the appellant to be the auc-
tion purchaser and therefore the true owner of the land. The second
G . respondent's revision therefrom was also rejected by the Financial
Commissioner on 23.10.1979. Thus all the authoritid in the successive
rounds found the facts against the second respondent.

The second respondent then filed a writ petition challenging the
Financial Commissioner's order dated 23. 10.1979 and the High Court,
H contrary to all the aforesaid findings of fact, remanded the case by
.. GURBAX SINGH v. FINANCIAL COMMR. ISAIK IA, J.] 19

its order dated 7. 1.83 to the Financial Commissioner for fresh decision A
in the light of the decree· of the civil court dated 17.11.1973, which·
the High Court at the same time declared to have been a collusive one.
obtained by second respondent in collusion with Budha Singh. The
Financial Commissioner on remand by the High Court has now held
vide Order dated 9.2.1988 that the second respondent is eligible for
allotment of the land under Rule 34C of the rules and accordingly B
allotted the land in his favour quashing the auctioin sale made in
favour of the appellant on 11.8.1967 holding that being a sub-lessee
in continuous possession since I. I. 1956, the second respondent had a
superior claim to allotment of the land and,. therefore, the auction
sale to the appellant was null and void. The appellant's writ petition
• challenging that Order having been dismissed in limine by the High
c
Court vide impugried Judgment dated 24.8.1988, he appeals.

Rule 34C included in Chapter V of the rules provides:

Allotment of agricultural lands of the value of Rs.10,000 or
less. Where any land to which this Chapter applies has been D
leased to a displaced person and such land consists of one
or more khasras and is valued at Rs.10,000 or less, the land
shall be allotted to the lessee: ·

Provided that where any such land or any part thereof
has been sub-leased to a displaced person and the sub- E
lessee has been in occupation of such land or part thereof
continuously from the first January 1956 such land or part.
thereof as the case·may be, shall be allotted to such sub-
lessce."

Mr. Rajeev Dhawan, the learned counsel for the appellant, F
submits, inter alia, that after Budha Singh's lease was cancelled
in· 1958, the second respondent's status as sub-lessee ceased and there-
after he was neither a sub-lessee nor bid he pay any rent for the land
and, in fact, he was a trespasser and not entitled to allotment unae;'
Rule 34C of the rules; that his first application was rightly rejected and
he having never preferred any appeal or revision therefrom, the order G
became final and binding on him, and he was, therefore, not entitled
to make the second application. After the land was already sold in
auction to the appellant on 1.8.67, counsel submits, the land ceased to
be evacuee property and the second respondent's second application
·' was not maintainable, and the appellant was declared as auction
purchaser on 15.8.1969 and the sale certificate issued to him was with H
effect from 15. 9. 1969.
20 SUPREME COURT REPORTS [1990) Supp. 2 S.C.R.

Mr. K.G. Bhagat, the learned counsel for the respondent, sub-
A
mits that the decision on his first application for allotment was not
communicated to him till he made his second application for allotment
and that as a sub-lessee he had the right to apply for allotment and
that his right has now been rightly recognised and the land allotted to
him though his second application was also rejected on 24.7.1969.
B
It appears that though the land was sold in auction to the appel-
lant under Rule 34H on 11.8.1967, perhaps because of the pendency of
the second application of the second respondent, the appellant was not
declared as auction purchaser during the pendency of that application
and only after it was rejected on 24.7. 1969, the appellant was declared
purchaser on 15.8.1969. It also appears that after the second respon-
c dent's revision petition against the order rejecting his second applica-
tion for allotment was remanded by the Chief Settlement Commis-
sioner to the Managing Officer for fresh decision and the latter
rejected that application also holding that the second respondent
failed to prove his continuous possession of the disputed land as sub-
1
D lessee as required under Rule 34C; and the appei!l therefrom was also
rejected on 13.5.1973, the Certificate of sale was issued to the appel-
lant on 23.6.1973 with effect from 15.9.1969. Thus, the matter should
have finally ended at that stage.

The second respondent's suit against Budha Singh leading to the
E decree declaring that the second respondent was in continuous posses-
sion of the disputed land was, argues Mr. Dhawan, not maintainable
and the decree was rightly held to have been collusive, but Mr. Bhagat
submits that the High Court was wrong in holding so.

Mr. Dhawan's submission that the sale in favour of the appellant
F culminating in issue of the sale certificate in his favour had the effect of
taking away the land from the pool of evacuee properties and there-
after so long that was not cancelled according to law, it was not open
for the Rehabilitation authorities to deal with the same appears to be
sound.

G Rule 34H of the rules reads:

"34H. Manner of disposal of land not allotted.-Any land
to which this Chapter applies which is not allotted under
this Chapter, shall be disposed of in the manner provided
in Chapter XIV." 1••

H
GURBAX SINGH v. FINANCIAL COMMR. [SAIKIA, J.l 21

Chapter XIV of the rules prescribes the procedure for sale of
property in the compensation pool. Rule 90 prescribes the procedure A
for sale of property by public auction. Sub-rule 15 of Rule 90 provides
for issue of sale certificate and for sending a certified copy of the sale
certificate by the Managin~ Officer to the Registering Officer within
the local limits of whose jurisdiction the whole or any part of the
property to which the certificate relates is situated. Rule 92 prescribes B
the procedure for setting aside the sale.

In Bishan Paul v. Mothu Ram, reported in AIR 1965 SC-1994, it
has been held that Rules 90 and 92 show that there are distinct stages
in the auction sale of property in the compensation pool, namely, (1)
the fall of the hammer and the declaration of the highest bid, (2) the
approval of the highest bid by the Settlement Commissioner or Officer c
appointed by him, (3) payment of the full price after this approval, (4)
grant of certificate, and (5) Registration of the certificate. That is the
intention behind the rules. The new form of the sale certificate
requires a mention that the purchaser had been declared the purchaser
of the said property with effect from the certificate date. The title, D
however, w.ould not be abeyance till the certificate was issued but
would be based on the confirmation of the sale. The intention behind
·j the rules appears to be that title shall pass when the full price is
realised and this is now clear from the new form of the certificate, and
title must be deemed to have passed and the certificate must relate
back to the date when the sale became absolute. The appellant, there- E
fore, must be held to have obtained title to the land on the date of
confirmation of the sale. That is why the Sale Certificate in the instant
case was expressly stated to be with effect from 15.9.1969.

Rule 92 provides:
F
"92. Procedure for setting aside a sale.-(!) Where a
person desires that the sale of any property made under
rule 90 or 91 should be set aside because of any alleged
irregularity or fraud in the conduct of the sale (including·in
the case of a sale by public auction in the notice of the sale)
he may make an application to that effect to the Settlement G
Commissioner or any officer, authorised by him in this
behalf to approve the acceptance of the bid or tender, as
the case may be.

(2) Every application for setting aside a sale under
this rule shall be made- H
22 SUPREME COURT REPORTS [ 1990) Supp. 2 S.C.R.

A (a) where the sale is made by public auction within seven
days from the date of the acceptance of the bid;

(b) where the sale is made by inviting tenders, within
seven days from the date when· the tenders were opened.

B xx xx xx xx xx
xx xx xx xx xx

Under Sub-rule (4), notwithstanding anything contained in Rule 92,
the Settlement Commissioner may, of his own motion, set aside any
sale under this Chapter if he is satisfied that any material irregularity

1
c or fraud which was resulted in a substantial injury to any person has
been committecl in the conduct of the sale. In the instant case we have
not been shown any application for setting aside of the auction sale
and the sale certificate in favour of the appellant made according to
rules. Nor have we been shown that th~ Settlement Commissioner of
D his own motion had set aside the sale being satisfied that any material
irregularity or fraud which had resulted in a substantial injury to any
pe~son had been committed in the conduct of the sale.

Section 14 of the Act provides for constitution of the compensa-
tion pool. Section 15 of the Act exempts the property in compensation
E pool from processes of courts. Section 20 of the Act empowers the
Managing Officer or managing corporation to transfer any property
within the compensation pool-( a) by sale of such property to a dis-
placed person or any association of displaced person whether incor-
porated or not, or to any other person, whether the property sold by
public auction or otherwise. Under sub-section (2) of that section
F every Managing Officer or managing corporation selling any immov-
able property by public auction under sub-section ( 1) shall be deemed
to be a Revenue Officer within the meaning of sub-section (4) of
section 89 of the Indian Registration Act, 1908. Under section 27 of
the Act save as otherwise expressly provided in the Act every order
made by eny officer or authority under the Act, including a managing
G corporation, shall be final and shall not be called.in question in any
court by way of appeal or revision or in any original suit, application or
execution proceeding. The jurisdiction of the Civil Court was there-
fore barred in the matter of the sale. It is true that where the special
tribunal or authority acts ultra vires or illegally, the Civil Court has by
virtue of s. 9 of the Civil Procedure Code power to interfere and set
,,...
•
H matters right: As was laid down by the Judicial Committee of the Privy
GURBAX SINGH v. FINANCIAL COMMR. [SA!KIA, J.] 23

Council in Secretary of State v. Mask and Co., AIR 1940 PC 105, if the
A
provisions of the Statute have not been complied with or the Statutory
Tribunal has not acted in conformity with the fundamental principles
of judicial procedure, the Civil Courts have jurisdiction to examine
those. cases. This rule was reiterated by the Supreme Court in State of
Kera/av. M/s. N. Ramaswami Iyer and Sons, AIR 1966 SC 1938. In
the instant case the second respondent's civil suit against Budha Singh B
for declaration of possession was not against any order passed by any
· 9fficer under the Act. That decree, even if it was not declared collusive
'"''' could not have collaterally affected the auction sale order.
·""
Mr. Dhawan is, therefore, right in his submission that the appel-
lant, a displaced person, having bona fide purchased the land in public
auction for Rs.9,500 and having paid that amount with the sincere c
hope of his rehabilitation, has been subjected to expensive protracted
litigation for the last'22 years during which he has earned nothing out ·
of the land while the second respondent had until the impugned or-
ders, been enjoying the usufruct of the land and this is because of the
State not honouring its own final commitment made in the sale certifi- D
cate in favour of the appellant. .,. ·
:· ~

Mr. Bhagat answers that the second respondent was in posses-
sion, in 1956, and till the cancellation of Budha Singh's lease in 1958, and
thereafter. He was admittedly a sub-lessee of Budha Singh till 1958
and then was a sub-tenant holding over on the date he applied for E
allotment in 1961. The decision rejecting his first application having
not been communicated to him he made his second application which
was also wrongly rejected by the Chief Settlement Officer; and the
Financial Commissioner ultimately on remand from the High Court,
on the basis of the second respondent's possession of the land, rightly
set aside the order of the Chief Settlement Commissioner dated <:F
11.1.1979 and allotted the land to the second respondent declaring him
lo be sub-lessee for the period after 1958 setting aside the sale made by
the Rehabilitation Department made in favour of the appellant and
that the High Court by the impugned Order dated 24.8.88 rightly
dismissed the appellant's writ application in limine. Mr. Bhagat also
persuades us to consider that the second respondent, also a displaced G
person, had been demanding justice for the last 22 years and has
finally succeeded in obtaining the allotment and he ought not to be
deprived of the same. Sri Dhawan attacks the order of the Financial
Commissioner on the ground that he had no material before him other
than what was there before his predecessor on 23. 10.1979, except the
judgment in the civil suit, which for obvious reasons, cannot be taken H
24 SUPREME COURT REPORTS [1990] Supp. 2 S.C.R.

A . into account. Mr. Dhawan emphasises that, it having been repeatedly
held earlier that continuous cultivating possession of the second
respondent was not proved, there was no basis for the Financial Com-
missioner in his order dated 9.2. 1988 to have observed that "a favour-
able presumption regarding continuity of his possession during the
intervening period that is from kharif 1961 to rabi 1964 ought to have
B been drawn and benefit of doubt given" to the second respondent, in
spite of the absence of Girdawari for the year 1961-62 and 1962-63 and
mutilations in the entries of Girdawari for 1963-64. In a sense, he is no
doubt correct but the previous order of 23.10.1979 having been set
aside by the High Court, it was open to the Financial Commissioner to
consider the matter afresh. Doing so, he has found that since the
pQSSession of the second respondent from 1953 to 1961 and again in
c 1964-65 and 1965-66 was borne out from the records, the absence of
the records for 1961-62 ad 1962-63 and their illegibility due to mutila-
. tion for 1963-64 ano 1964-65 should not be held against him and that
his continuous possession since 1962 can be presumed entitling him to
an allotment under S. 34C. This was a conclusion on facts, which the
D High Court has declined to interfere with.

Thus, we have a peculiar position in this case. While Mr.
Dhawan is right in saying that the appellant, as a bona fide purchaser
of the land for value at public auction, should be put in the same
position in which he would have been had his auction purchase as
E evidenced by the Sale Certificate been effective from the date of
purchase, Mr. Bhagat appears to be justified in saying that it would
not be just and proper to deprive the second respondent who was
inducted by Budha Singh as a sub-lessee and who has continued in
possession of the land till date, of the fruits of his protracted litigation
culminating in allotment of the land to him. The difficulty in the pre-
F sent case has arisen because the State confirmed the sale in favour of
the appellant in 1969 and issued a sale certificate to him in 1973 with-
out waiting for the final outcome of the second respondent's revision
application to the Chief Settlement Commissioner and further pro-
ceedings consequent thereon. The odd situation, creating equities in
favour of both the parties, that has thus resulted in the present case is
G due to the fault of the appellant or the second respondent. It could
have been avoided if the State had held over the auction until the
second respondent"s application had been finally disposed of or had
held the auction subject to the result of the application. It is true that
the second respondent could have taken steps to challenge the auction
in favour of the appellant but, perhaps misguidedly, he was con- •
H centrating on getting an allotment under S. 34C for which he cannot be
GURBAX SINGH v. FINANCIAL COMMR. [SAIKIA, J.l 2$ ·

wholly blamed. Whatever that may be, the final position is that both
parties have had to suffer and indulge in lengthy litigation. /

Under the above circumstances we feel that while this Court is to
administer justice according to law there may be scope for doing
justice and equity between the parties. In such a situation we remem-
ber what the Institute of Justinian, De Justitia Et Jure, in 'Liber · · B
Primus' Tit. I said: "Justice est constans et perpetua voluntas jus suum
cuique tribuendi." Justice is the constant and perpetual wish to render
every one his due. "Jurisprudentia est divinarum atgue humanarum
rerum notitia, justi atgue injusti· scientia." Jurisprudence is the
knowledge of the things divine and human; the science of the just and
the unjust. The divine is that which right reason commends. The
human is also in the contents of the law. As Max Rumelin said, in the c
Struggie to govern Law, "Justice is rivaled by equity." The dilemma
that equity is to be b_etter than justice and yet not quite opposed to
justice, but rather a kind of justice has troubled us. Gustav Radbruch
clarifies the mutual relation between two kinds of justice, namely,
commutative and distributive. We may call "just" either the applica~ D
tion or observance of law, or that law itself. "The former kind of
justice, especially the justice of the Judge true to the law," according
_to him~ "might better be called righteousness." Here "we are ~on
cemed not with justice which is measured by positive law, but rather
with that by which positive law is measured." Justice in this sense
means equality. Aristotle's doctrine of justice or eqality is called by E
him commutative justice ~hich requires at least two persons while
distribute justice requires at least three. Relative equality in treating
different persons while granting relief according to need, or reward
and punishment according to merit and guilt is the essence of distribu-
tive justice. While i11 commutative justice the two persons confront
each other as co-equals, three or more persons are necessary in dis- F
tributive justice in which one, who imposes burdens upon or grants
advantages to the others, is superior to them. "Therefore, it pre-
supposes an act of distributive justice which has granted to those
concerned, equality of rights, equal capacity to act, equal status."·
(The Legal Philosophies of Lask, Radbruch and Dabin-P. 74)
According to Radbruch, "distributive justice is the prototype of G
justice. In it we have found the idea of justice, toward which the
concept of law must be oriented." Law offers and protects and condi-
tions necessary for the life of man and his perfection. In the words of
Cardozo, "What we are seeking is not merely the justice that one
receives when his rights and status are determined by the law as it is;
what we are seeking is .t justice to which law in its making should H
26 SUPREME COURT REPORTS [ 1990] Supp. 2 S.C.R.

A conform.'' The. sense of justice will be stable when it is firmly guided
by the 'pragma' of objective and subjective interests.

In the instant case the Financial Commissioner is a party. What
we find in the instant case is that the Rehabilitation authorities acting
under the Act and the Rules decided the competing claims of the
B
appellant as well as the second respondent as to the land. If the
Rehabilitation authorities can provide an equal extent of land with
equal benefits to both the p;uties justice, may appear to be done but
that being uncertain, the availability of land being limited, this Court
can only look towards equity for solution.

C Considering the facts of the instant case including the extent of
the land and the purposes of the Act and the Rules, and the reality that
the land must have become scarce and much more valuable now than
in 1967, we feel that the ends of justice on the facts of the present case
require that the impugned Orders be set aside and the land be caused
D to be divided by the Financial Commissioner into two equal halves and
one half be given possession of to the appellant by dint of his auction
purchase and the other half be allotted and given possession of to the
second respondent under Rule 34C of the rules. We order accordingly.
We direct the Financial Commissioner or the Chief Settlement Com- •
missioner, after notice to the appellant and the second respondent, to
E divide the land forthwith into two qua! halves and deliver possession
of the appellant's moiety to him. They should carry out the above
directions within three months from the date of receipt of this order.
The parties shall cooperate in carrying out of the directions and we
hope that they will be able to live in peace thereafter. The appeal is
disposed <>f accordingly. Under the facts and the circumstances of the
case, we make no order as to costs. A copy of the Judgment may be
F forwarded forthwith to the Financial Commissioner.

S.B. Appeal allowed.

;.