Holding

The sale by tender was valid, ownership passed to the purchaser, the shop is an evacuee property, Section 29 does not protect the respondent, and the High Court’s reversal of the trial court decree is set aside.

Summary

The Ministry of Rehabilitation constructed a market shop that formed part of the compensation pool under the Displaced Persons (Compensation and Rehabilitation) Act, 1954 and was sold by tender to Hans Raj Banga. The predecessor‑in‑interest, Bhagwan Das, a squatter and not a displaced person, failed to bid and did not pay rent within the stipulated 60‑day period, and his successors challenged the sale and sought possession. The Supreme Court held that the Department was authorized to sell the property by tender, the sale was valid, and ownership passed to the purchaser upon full payment and issuance of the sale certificate. The property was confirmed as evacuee property, and Section 29 of the Act did not protect the respondent because he was not a displaced person and had not complied with the rent‑payment condition. Consequently, the High Court’s order setting aside the trial court decree was reversed and the decree for possession and damages in favour of the appellant was restored.

Issues considered

The validity of the sale of the evacuee property by invitation of tenders
Whether the sale conferred ownership on the purchaser
Whether the property constituted evacuee property within the meaning of the 1954 Act
Applicability of Section 29 of the Displaced Persons (Compensation and Rehabilitation) Act, 1954 to the respondent
Whether the respondent, as successor‑in‑interest, became a tenant protected from eviction
Whether the respondent was estopped from challenging the sale

Legislation cited

Administration of Evacuee Property Act, 1950s. 2(a)
Displaced Persons (Compensation and Rehabilitation) Act, 1954s. 14, s. 21, s. 29
Transfer of Property Act, 1882s. 106

Subjects

evacuee propertydisplaced persons actsale by tenderownership transfersection 29 protectionestoppelpossessionrent arrearstenant

Judgment

A HANS RAJ BANGA
v.
RAM CHANDER AGGARWAL

APRIL 29, 2005

B [ASHOK BHAN AND A.K. MATHUR, JJ.]

Displaced Persons (Compensation and Rehabilitation) Act, 1954-
Sections 14 and 29-Administration of Evacuee Property Act, 1950-Section
C 2(a)-Construction ofmarket by Government andformed part ofcompensation
pool which was to be transferred on ownership basis to the displaced person-
Squatterer not being a displaced person, occupying land.before the construction
of market and seeking transfer of shop-Order of High Court that the
Department could sell shop by auction or by inviting tender and giving
opportunity to the occupier of the shop-Tenders invited-Squatterer did not
D participate-Sale confirmed in favour of purchaser-Non-payment of rent by
occupier within. sixty days from the date of sale-Suit for possession and
damages-Grant of decree of possession in favour of purchaser holding him
to be the owner of the property-High Court set aside the decree-On appeal
held: Squatterer did not pay rent due within the stipulated period as such
squatterer and also his successor-in-interest not a tenant of purchaser-
£ Squatterer also not a displaced person as such not covered by Notification
issued under sei:tion 29 of the Act, hence not entitled to protection from
eviction-Furthermore, sale of shop in favour ofpurchaser by inviting tender
valid, property was an evacuee property and the issue of ownership and
validity of sale concluded earlier proceedings as such occupier estopped from
F challenging the sale and ownership-Hence, purchaser became the owner of
property and entitled to possession and damages in terms of decree by Trial
Court.

The Ministry of Rehabilitation constructed a f!larket, a Government
built in property and it formed part of the compensation pool within the
G meaning of Section 14 of the Displaced Persons (Compensation and
Rehabilitation) Act, 1954 which was to be transferred on ownership basis ·
to displaced persons only. B;..squatterer, predecessor-in-interest of the
respondent occupied land before ~he construction of market and ·was
offered shop as temporary measure as alternative accommodation. B
H 994
HANS RAJ BANGA v. RAM CHANDER AGGARWAL 995

though not a displaced person sought transfer of the shop in his favour. A
High Court disposed of the writ petition holding that the Department could
sell the shop by public or private auction or by calling tenders and the
occupier would be given equal opportunity to give his bid. Department
invited tenders for sale of the shop. B did not participate in the sale and
the tender of the appellant being highest was accepted and the sale was
confirmed in his favour. B died but neither B nor his successor-in-interest B
nor any legal heir paid rent to the appellant from the inception of the
tenancy as per the sale condition, as such demand notice was issued.

Appellant filed suit for possession and recovery of damages.
Meanwhile respondent and other legal heirs of B filed petition for quashing C
.. of sale in favour of the appellant since they came to know about the sale
recently. Rehabilitation Authorities and the High Court upheld the sale
and transfer of the shop in favour of the appellant. Appeal in this Court
was dismissed as withdrawn and as a result sale made in favour of the
appellant attained finality. Trial Court decreed the suit for possession of
the suit property in favour of the appellant. High Court set aside the order D
of High Court. It held that the sale made in favour of the appellant by
inviting tenders was invalid; that in the earlier proceedings only the
question of the validity of sale was involved which attained finality and
not the issue of ownership; that the property was not evacuee property;
that section 29 of the Act was not applicable to the facts of the case; and E
that the respondent was tenant of the suit property. Hence the present
appeal.

Allowing the appeal, the Court

HELD : 1. The High Court erred in setting aside the decree of F
possession of suit property in favour of the appellant and therefore,
judgment and decree passed by the High Court is set aside and that of
the Trial Court is restored. (1009-DJ

2.1. It is clear from the reading of the order of High Court in the
writ petition filed by predecessor-in-interest of the respondent that the G
Department had the option to sell the suit property either by auction,
public or private, or by calling the tenders. The Department sold the
property by inviting tenders. An advertisement was issued in the
newspapers inviting tenders, in response to which the appellant filed 'his
tender which was accepted being the highest. Predecessor-in-interest of
the respondent did not file a tender in response to the advertisement. H
996 SUPREME COURT REPORTS [2005] 3 S.C.R.

A Therefore, the sale has been made as per order passed by the High Court
by inviting tenders, the same is valid and the finding recorded by the High
Court that the property could be sold only by way of public auction and
not by any other mode as per the order cannot be sustained being factually
incorrect. 11003-C-E)

B 2.2. Appellant became the owner of the property, the moment full
price of the property was paid and the title of the property passed on to
him from the day of the confirmation of the sale and the issuance of sale
certificate. High Court erred in holding that the issue of ownership was
not concluded in the earlier proceedings instituted by the respondents
C before the Rehabilitation Authorities, nor in the Writ Petition in the High
Court and the Appeal in this Court; and that only the question of validity
of sale was involved in the earlier proceedings and not of ownership. It
failed to appreciate that the valid sale confers both the title and the
ownership rights in the purchaser. After the rejection to the challenge to
the sale deed up to this Court, the appellant became the owner of the
D property in dispute and it cannot be said that even though the sale has
been upheld the appellant did not become the owner of the property.
(1003-G-HJ

Bishan Paul v. Mothu Ram, AIR (1965) SC 1994, r.eferred to.

E 2.3. High Court erred in not appreciating that the matter with regard
to the validity of the sale in favour of the appellant had been decided
between the parties in the earlier proceedings and the decision attained
finality up to this Court. Respondent could not be permitted to canvass
against this issue again in the present suit since the decision had already
F been rendered in favour of the appellant on this point; the respondent was
estopped in law from challenging the sale made in favour of the appellant
and his ownership on the same grounds. 11005-C-E]

2.4. High Court held that the property was not an evacuee property.
It did not record any reasons for coming to this finding. No issue was
G framed in the suit on this point. Property was being treated and dealt with
as evacuee property throughout. Respondent in the earlier proceeding and
also the Department in writ petition filed by the predecessor-in-interest
of the respondent, treated the property to be part of the 'compensation
pool' within the meaning of Section 14 of Displaced Persons (Compensation
and Rehabilitation) Act, 1954. The finding recorded by the High Court
H that the property was not an evacuee property is bereft of any reasons
HANS RAJ BANGA v. RAM CHANDER AGGARWAL 997
whatsoever, against the record and the findings recorded in the earlier A
round of litigation and as such are to be set aside. (1004-G-H; 1005-A-CJ

2.5. As per the definition of the word 'allotment' in Section 2(a) of
the Administration of Evacuee P,roperty Act, 1950 an allottee of the
custodian is not the tenant ofthe,c~stodian. He is not a lessee but is merely
a licensee of the Department. On the disposal of the property under the B
Displaced Persons (Compensation and Rehabilitation) Act, by auction or
otherwise, the allottee of the custodian or the occupier of the premises
becomes the tenant of the transferee. Under section 29 of the Act, a
deeming provision is introduced whereby such allottee becomes tenant of
the transferee which was held by it immediately before the transfer. C
Question as to whether an allottee becomes a tenant, or not, will depend
on the question whether the same falls within the purview of Section 29
of the Act. Section 29 is enacted to give protection from ejectment to the
class of persons or class of property to be notified under clause (2) of
Section 29. (1005-E-H; 1006-AJ
2.6. Predecessor-in-interest of the respondent admittedly was not a D
displaced person and, therefore, not covered under categories 3 and 4 of
the notification. He also did not fall under categories I and 2 as admittedly
he did not pay the arrears of rent due within 60 days of the transfer. This
is clear from the fact that Department had issued demand notice much
after the transfer of the property, to the respondents to pay the arrears E
of rent from the inception of the tenancy till its sale in favour of the
appellant. Assertion made by the respondent that he did not come to know
about the advertisement inviting tenders for the sale of the property or
that he did not come to know about the sale of the property in favour of
the appellant cannot be accepted. Knowledge of this fact would be personal
to him and there is nothing on record to show that he did not come to F
know about the sale of the suit property in favour of the appellant. The
payment was required to be made within 60 days from the date of sale
and since B did not fulfil the condition he did not become the tenant of
the appellant. Respondent being the successor-in-interest of B would
acquire/inherit whatever B possessed. A!I B did not become the tenant of G
the appellant, the respondent being the successor-in-interest of B would
also not become the tenant of the appellant. (I 008-H; 1009-A-CJ
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 642 of2003.

From the Judgment and Order dated 22.3.2002 of the Delhi High Court
in R.F.A. No. 250 of 1982. H
998 SUPREME COURT REPORTS [2005) 3 S.C.R.

A · Ranjit Kumar and S.K. Bagga, Seeraj Bagga, A.P. Mayee, Sanjiv K.
Choudhary and Mrs. Sureshta Bagga with him for the Appellant.

B.P. Aggrawal, Om Prakash Mishra, B.M. Aggrawal and Ghan Shyam
Vasisht for the Respondent.

B The Judgment of the Court was delivered by

BHAN, J. This appeal by grant of leave has been filed against the
judgment and order dated 22.03.2002 passed by the High Court of Delhi at
New Delhi in Regular First Appeal No. 280 of 1982. By the impugned order
the High Court has allowed the appeal and set aside the judgment and decree
C for possession of the suit property and damages passed by the Trial Court in
favour of the plaintiff-appellant.

FACTS

Premises in dispute is an evacuee property i.e. shop No. 114, New
D Qutab Market, New Delhi, a Government Built Property in terms of Rule
2(d) of the Displaced Persons (Compensation and Rehabilitation) Rules; 1955
and forms part of the compensation pool within the meaning of Section 14
of the Displaced Persons (Compensation and Rehabilitation) Act, 1954 (for
short "the Act")
E Bhagwan Das, father and predecessor-in-interest of the defendant-
respondent who was not a displaced person filed C.W.P. No. 458-D of 1958
in the Circuit Bench of the Punjab and Haryana High Court at Delhi seeking
transfer of shop No. 114, in his favour on the ground that the same was
allotted to him with effect from 10.05.1956 by the Department and he has
F been regularly paying rent for the same and prayed that the same be transferred
in his favour, instead of selling it in public auction to any other person. Shri
M.S. Chadha, Settlement Commissioner, Ministry of Rehabilitation filed the
counter affidavit on behalf of the Department and took the stand that the
Qutab Market was constructed by the Ministry of Rehabilitation and the same
forms part of the compensation pool within the meaning of Section 14 of the
G Act to be transferred on ownership basis to displaced persons only. It was
also stated that these shops were offered as a temporary measures to squatters
(Bhagwan bass, predecessor-in-interest of the respondent) as an alternative
accommodation as they were occupying the land before the construction of
the market but the same could not be transferred/sold to Shri Bhagwan Dass
H a squatterer or to any other squatter who was not a displaced person. Similarly,
HANS RA.I BANGA v. RAM CHANDER AGGARWAL [BHAN, J.] 999

certain other persons had also filed writ petitions. C. W.P. No. 438-D of 1958 .A
and other connected matters were disposed of by an order dated 21.09 .1960
wherein it was agreed by the Department that if the Department decides to
sell the shop in question by auction, whether public or private, or by calling
tenders, the occupier of the shop will also be given equal opportunity to give
his bid or tender, as the case may be, and the bid or tender of the occupier B
will be considered on merits along with other bidders or tenderers, if any.

An advertisement was issued on 28.12.1960 in the papers inviting tenders
for the sale of the various shops located in different markets by tender.
Appellant submitted his tender along with draft No. 03260/2 dated 4.1.1961
for Rs. 350 drawn on Union Bank of India, Karol Bagh, New Delhi towards C.
5% earnest money. Appellant's tender being the highest was accepted and the
remaining price was adjusted against the verified claim of the appellant as
per Section 8 of the Act. Bhagwan Dass did not participate in the sale
proceedings conducted consequent to the order dated 21.09.1960 passed by
the High Court in C.W.P. No. 438-D of 1958. Sale certificate duly confirmed
under the rules was issued in favour of the appellant in respect of shop No. D ·
114, New Qutab Road Market, New Delhi. Lease deed was also issued on
17. I 0.1963 and the same was registered on 22.02.1964 by the Sub. Registrar.
By mistake in the lease deed the property was mentioned as 114, New Rajinder
Nagar instead of 114, New Qutab Road which was corrected by a
supplementary lease deed dated 28.02.1967. In the supplementary lease deed E '
it was mentioned that the area sold to the appellant was shop No. 114, New
Qutab Road and not 114, New Rajinder Nagar which had been mentioned in
the lease registered on 22.02.1964. One of the conditions of sale as per
advertisement was that if any of the properties is under the occupation of the
allottees or unauthorised occupants the purchaser will be entitled to received
the rent from the tenants. F
Bhagwan Dass died in the year 1962. Since neither Bhagwan Das,
predecessor-in-interest of the respondent nor the respondent or any other
legal heir of Bhagwan Dass had paid any rent from the inception of the
tenancy, a demand notice was issued to the respondent under Section 21 of
the Act for recovery of the rent for the period 8.8.1955 to 27 .02.1961 i.e. till G
the date of sale of the shop to the appellant.

Appellant filed the suit for possession of Shop No. 114, New Qutab
Road and recovery of damages for unauthorised use and occupation of the
property against the respondent on 26th of July, 1973. The respondent filed H
1000 SUPREME; COURT REPORTS [2005] 3 S.C.R.

A the written statement on 3rd of May, 1978 which was later on amended on
31st of October, 1981 and resisted the suit on the ground that the appellant
was not the owner of the property as the same could not be transferred tc the
appellant by way of sale. That the Joint Hindu firm Mis. Shima Mal Dina
Nath of which he was a member was the tenant in the premises since 8.8.1955
B by virtue of Ext. D-1 ·letter of allotment and Ext. D-3 terms of tenancy. It was
pleaded by him that the rent of the shop was Rs. 19.80 and not Rs. 40 per
month as demanded. In the alternative, it was pleaded that he was entitled to
adjust the sum of Rs. 4, 186.83 paid by him as house tax.

After the filing of the suit, Shri B.P. Aggrawal, brother of the respondent
C and a legal heir of Late Bhagwan Singh filed an application before the Regional
Settlement Commissioner for supply of documents relating to the tenancy of
Bhagwan Das in respect of Shop No. 114. On 23rd of February, 1978, a
petition under Section 24 of the Act was filed by the respondent along with
other legal heirs of Bhagwan Das seeking quashing of the sale made in
favour of the appellant with consequent relief of sale afresh in favour of the
D legal representatives of Bhagwan Das. It was alleged that the respondent
came to know about the sale in favour of the appellant for the first time on
17th of February, 1978. This petition was dismissed by the Deputy Chief
Settlement Commissioner exercising the powers of Chief Settlement
Commissioner on 5.7.1978 thereby upholding sale and transfer of the shop
E in favour of the appellant. Aggrieved against this order, respondent filed a
revision petition before the Central Government under Section 33 which was
dismissed on 25th of November, 1978. Being aggrieved by the passing of
these orders, respondent along with other heirs .c)f Bhagwan Das filed CWP
No. 396/1979 in the High Court of Delhi seeking quashing of the orders and
the sale made in favour of the appellant with consequential relief of sale
F afresh in their favour. High Court dismissed the writ petition on 9.4.1979,
aggrieved against which respondent filed SLP(C) No. 10765/1979 in which
leave was granted and the same was registered as Ci vi I Appeal No. 615/ 1982.
The respondent got the C.A. No. 615/1982 dismissed as withdrawn and as a
consequence thereof the sale made in favour of the appellant and the orders
G passed by the authorities and the High Court rejecting the respondent's
challenge to the sale made in favour of the appellant attained finality.

After the conclusion of these proceedings, the trial court in the suit
filed by the appellant on 26th of July, 1973 whiCh was re-numbered as Suit
No. 781/1976 framed the following issues/additional issues :-
H
HANS RA.I BANGA v. RAM CHANDER AGGARWAL [BHAN. J.] 100 J

"I. Whether plaintiff is the owner of the suit property? A
2. Whether suit is properly valued for purposes of Court fee and
jurisdiction? If not, what is the proper valuation?
3. Whether plaintiff is entitled to any damages? If no, at what rate;
for what period and to what amount?
B
4. Whether the defendants of Mis. Bhima Mal Dina Nath, alleged
Joint Hindu Family, is a tenant of the suit premises as alleged in
the written statement, if so, to the what effects?
5. Whether the suit is time barred?
6. Whether the Civil Court has no jurisdiction to entertain the suit C
and decide the suit?
7. Relief.

Additional Issues

1. Whether the sale of the property in dispute in favour of the plaintiff D
by t:1e Ministry of Rehabilitation is a nullity as alleged by the
defendants in the amended written statement? OPD.
2. Whether a Civil Court has got no jurisdiction to go into the validity
or otherwise of the sale?
E
3. Whether Union of India is a necessary party? If so, what is the
effect '>f not joining it?"

Trial Court decided all the issues in favour of the appellant. Appellant
was held to be the owner of the suit property. Suit was held to .be property
valued for the purpose of court fee and jurisdiction. Regarding Issue No. 3, F ,
it was held that the appellant was entitled to damages which were quantified
at Rs. 3,600. It was held under issue No. 4 that M/s. Bhima Mal Dina Nath,
the alleged Joint Hindu family was not the tenant of the suit premises and in
Issue No. 5, it was held that the suit was within limitation. Regarding Issue
No. 6, it was held that the Civil Court has the jurisdiction to entertain and
decide the suit. Additional Issues I and 2 were not pressed by the respondent. G '

- Trial Court came to the conclusion that the documents relied upon by the
respondents to establish tenancy were manipulated and even as per these
documents it stood established that the respondents and their predecessors-in-
interest had never paid any rent from the inception of the tenancy, as a result
of which, a demand notice Ext. D-6 towards the arrears of rent was issued H
1002 SUPREME COURT REPORTS [2005] 3 S.C.R.

A to the respondent for the period 8.8.1955 to 27.7.1961 i.e. till the date of sale
of the suit property to the appellant. As the respondent ~ad failed to pay the
rent agreed upon, the tenancy created in his favour stood terminated. Trial
Court also came to the conclusion that the respondent was not entitled to the
benefit of Section 29 of the Act. It was held that since there was no relationship
B of landlord and tenant, the Civil Suit was maintainable. In view of the findings
recorded, the Trial Court decreed the suit and the appellant was given a
decree for possession of the suit property and damages in the sum of Rs.
3,600 for unauthorised use and occupation of the suit property by the
respondent.

C Aggrieved against the judgment and decree passed by the Trial Court,
respondent filed Regular First Appeal in the High Court of Delhi at New
Delhi which was numbered as RF A No. 250/1982. High Court accepted the
appeal and set aside the judgment and decree passed by the Trial Court. It
came to the conclusion that as per compromise arrived at in CWP No ..438-
D/l 958 filed by Bhagwan Das, the Department could sell the property only
D by way of public auction and not by any other mode. Since in the present
case, the sale was made in favour of the appellant by inviting tenders the
same was not valid. The High Court further held that the Trial Court fell in
error in giving undue weight to the unexhibited documents marked as 'PX'
and 'PY'. That Ext. 'PX' pertained to Shop No. 114, New Rajinder Nagar
E and not to a shop in New Qutab Road. The supplementary lease Deed executed
in the natue of corrigendum, substituted the words "114, New Qutab Road"
in place of 114, New Rajinder Nagar, was rejected as these documents were
not put to Mr. S.B. Lal, PW 4, a Clerk of the Office of the Rehabilitation
Department and DW 6 When they appeared in the witness Box. The High
Court also came to the conclusion that the property was not an evacuee
F property. It was further held that Section 29 of the Act was not applicable to
the facts of the present case and that the respondent was a tenant ·of the suit
property.

Learned counsel for the parties have been heard at length. With their
help we have gone through the findings recorded by the High Court as well
G as the Trial Court and the evidence on record.

The High Court has erred in holding that as per orders passed by the
High Court in the Writ Petition No. 438-D/l 958 filed by Bhagwan Das, the
property could be sold only by way of public auction and not by any other
mode. The High Court on 21st of September, 1960 on a concession made by
H
HANS RAJ BANGA v. RAM CHANDER AGGARWAL [BHAN, J.] I 003
the Department of Rehabilitation passed the order in CWP 438-D of 1958 in A
the following terms :-

"A compromise has been arrived at between the petitioner and
respondents in this case to the effect that if the Government decides
to sell the shop in question by auction, whether pub! ic or private, or
by calling tenders, the petitioner will also be given equal opportunity B
to give his bid or tender, as the case may be, and that the bid or
tender of the petitioner will be considered on merits along with other
bidders or tenderers, if any."

It is clear from the reading of the order that the Department had the
option to sell the suit property either by auction, public or private, or by C ·
calling the tenders. In the present case, the Department sold the property by
inviting tenders. An advertisement was issued in the newspapers inviting
tenders, in response to which the appellant filed his tender which was accepted
being the highest. Bhagwan Das did not file a tender in response to the
advertisement. The finding recorded by the High Court is factually incorrect. D
The High Court has erred in holding that the sale was bad in law having been
made in contravention of the order passed by the High Court in CWP No.
438-D/1958. The Department had the option to sell the property either by
auction, public or private or by calling the tenders. It was left to the Department
to choose either of the two modes and the Department sold the property by
inviting the tenders as pt;:r the undertaking given by it to the High Court. The E
sale has been made as per order passed by the High Court by inviting tenders,
the same is valid and the finding recorded by the High Court to the contrary
cannot be sustained being factually incorrect.

The bid by way of tender given by the appellant being the highest was
accepted. He paid the entire sale consideration. The sale was confirmed in his F
favour and the Sale Certificate was issued. Since the property was sold on
leasehold basis, the lease Deed was executed on 17th October, 1963 which
was registered on 22nd February, 1964. The appellant became the owner of
the property, the moment full price of the property was paid and the title of
the property passed on to him from the day of the confirmation of the sale G
and the issuance of sale certificate. The High Court, in our view, erred in
holding that the issue of ownership was not concluded in the earlier
proceedings instituted by the respondents before the Rehabilitation Authorities,
the Writ Petition in the High Court and the Appeal in this Court. It also erred
in holding that only the question of validity of sale was involved in the
H
1004 SUPREME COURT REPORTS [2005] 3 S.C.R.

A earlier proceedings and not of ownership. It failed to appreciate that the valid
sale confers both the title and the ownership rights in the purchaser. After the
rejection to the challenge to the sale Deed up to this Court, the appellant
became the owner of the property in dispute and it cannot be said that even
though the sale has been upheld the appellant did not become the owner of
B the property. The view taken by the High Court is against the law laid down
by this Coui:t in Bishan Paul v. Mothu Ram, AIR (1965) SC 1994 and also
against the fundamental principle of jurisprudence as it is an established fact
that avalid sale confirmed by the authorities confers title as well as ownership
rights in the purchaser. Valid sale of property and ownership are inseparable
and the moment the price is paid and sale is confirmed the purchaser becomes
C the owner. In Bishan Paul's case (supra), it was held :-

"It seems to us that the matter must be considered on general principles.
In this case the highest bid was of the respondent and he paid the full
price before the sale in his favour was confirmed. The sale certificate,
though issued later, mentioned the date of the confirmation of the
D sale in his favour. The tenant was asked to attom to the purchaser
from the date of confirmation of sale and thus possession was also
delivered on that day. Title, therefore, was not in abeyance till the
certificate was issued but passed on the confirmation of sale. The
intention behind 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
E certificate reproduced in Jailmal's case, 66 Pun LR 99: AIR (1964)
Punj 99. No doubt till the price is paid in full there is no claim to the
property, but it seems somewhat strange that a person who has paid
the price in full and in whose favour the sale is also· confirmed and
who is placed in possession should only acquire title to the property
F from the date on which a certificate is issued to him. There may
conceivably be a great deal of time spent before the certificate is
granted. In this case the tenant was told to attom from October 3,
1956 because nothing remained to be done except the ministerial acts
of issuing the certificate and getting it registered. Therefore, so far as
title was concerned, it must be deemed to have passed and the
G certificate must relate back to the date when the sale became absolute."

The High .Court also erred in holding that the property was not an
1
evacuee property. High Court recorded this finding in one line by observing,
"It was not an evacuee property". No reasons have been recorded for coming
H to this finding. No issue ·was framed in the suit on this point. Property was
HANS RA.I BA NGA v. RAM CHANDER AGGARWAL [BHAN, J.] 1005
being treated and dealt with as evacuee property throughout. Respondent in A
the earlier proceeding did not take the stand that the property was not the
~

~vacuee property, on the contrary he treated the property to be a part of
"compensation pool" which is evident from the fact that the respondent filed
the revision petition under Sections 24 and 33 of the Act by treating the
property to be an evacuee property. The Department in CWP No. 458-D/
1958 filed by the Bhagwan Das, predecessor-in-interest of the respondent B

'- had taken a firm stand that the property formed part of the "compensation
pool" within the meaning of Section 14 of Displaced Persons (Compensation
and Rehabilitation) Act, 1954. The finding recorded by the High Court is
bereft of any reasons whatsoever, against the record and the findings recorded
in the earlier round of litigation. The same deserves to be set aside. c
-1 High Court erred in not appreciating that the matter with regard to the
I validity of the sale in favour of the appellant had been decided between the
parties in the earlier proceedings and the decision attained finality up to this
Court. The respondent could not be permitted to canvass against this issue
again in the present suit. The grounds of chaUenge to the ownership of the D
respondent in the present case is the same which was taken by him in the
earlier proceedings under Sections 24 and 33 of the Act and the Writ Petition
and the Appeal in this Court. Since the decision had already been rendered
in favour of the appellant on the point, the respondent was estopped in the
law from challenging the sale made in favour of the appellant and his
ownership on the same grounds in the present case.
E

An allottee of the custodian is not the tenant of the custodian. This is
clear from the definition of the word "allotment" in Section 2(a) of The
~ Administration of Evacuee Property Act, l950. This definition is in the
following terms :- F
"S.2(a): "allotment" means the grant by a person duly authorized in
this behalf of a right of use of occupation of any immoveable evacuee
property to any other person, but does not include a grant by way of
lease;"
G
It is clear from this definition that the allottee is not a lessee but is
......_ merely a licensee of the Department. On the disrosal of the property under
The Displaced Persons (Compensation and Rehabilitation) Act, by auction or
otherwise, the allottee of the custodian or the occupier of the premises becomes
the tenant of the transferee. Section 29 which is a special provision enacted
to give protection from ejectment to the class of persons or class of property H
1006 SUPREME COURT REPORTS [2005] 3 S.C.R.

A to be notified under clause (2) of Section 29. Under section 29 a deeming
provision is introduced whereby such allottee becomes tenant of the transferee
which was held by it immediately before the transfer. Section 29 reads as
under :-

"S. 29 (I) Where any person to whom the provisions of this section
B apply, is in lawful possession of any immovable property of the class
notified under sub-section (2), which is transferred to another person
under the provisions of this Act, then, notwithstanding anything
contained in any other law, such person shall, without prejudice to
any other right which he may have in the property, be deemed to be
c a tenant of the transferee on the same tern.s and conditions as to
payment of rent or otherwise on which he held the property
immediately before the transfer :

Provided that notwithstanding anything contained in any such
tenns and conditions, no such person shall be liable to be ejected
from the property during such period not exceeding two years as may
D
be prescribed in respect of that class ofproper.y, except on any of the
following grounds, namely :-

(a) that he has neither paid nor tendered the whole amount of
arrears of rent due after the date of the transfer within one month
of the date on which a notice of demand has been served on him
E
by the transferee in the manner provided in Section I 06 of the
Transfer of Property Act, 1882;
(b) that he has, without obtaining the consent of the transferee
in writing-

F (i) suhlet or otherwise parted with the possession of the
whole or any part of the property, or

(ii) used the property for a purpose other than the purpose
for which he was using it immediately before the transfer;

G (c) that he has committed any act which is destructive of, or
pennanently injurious to, the property.

(2) The Central Government may, from time to time by notification
in the Official Gazette, specify the class of persons to whom, and the l-
class of immovable property in the compensation pool, other than !--
H agricultural land, in respect of which, the provisions of this section

,_
HANS RAJ BANGA v. RAM CHANDER AGGARWAL [BHAN,J.] 1007
shall apply and in issuing any such notification the .Central Government A
shall have regard to the following matters, that is to say,-

(a) the length of the period for which any such persons may
have been in lawful possession of the property;
(b) the difficulty of obtaining alternative accommodation;
B
.~·
(c) the availability of any other suitable residential accommodation
for the use of the transferee; and
(d) such other matters as may be prescribed."

Under sub-Section (l) of Section 29, a person in lawful possession of
any immovable property notwithstanding anything contained in any other C
law and without prejudice to any other right which he may have in the
property by a deemed fiction becomes the tenant of the person to whom the
property is transferred on the same terms and conditions as to the payment
of rent or otherwise on which the property was held by him immediately
before the transfer. Protection granted under Section 29( l) is not absolute D
and as per proviso is limited for a period of two years. Even during the
period of two years such a person could be evicted if the grounds mentioned
in clauses (a), (b) and (c) to Section 29(1) came into operation. Question as
to whether an allottee becomes a tenant, or not, will depend on the question
whether the same falls within the purview of Section 29 of the Act. Section
29(2) of the Act provides that the Central Government may from time to time E
by a notification in the Official Gazette specify the class of persons to whom,
and the class of immovable property in the compensation pool, other than
agricultural land, in respect of which, the provisions of this Section shall
apply and that the Central Government shall, while issuing such notification,
keep in mind the matters mentioned in clauses (a), (b), (c) and (d) of sub- p
Section (2).

In exercise of the powers given under Section 29(2), the Central
Government issued a notification SRO 2219. Under this notification, provisions
of Section 29 had been made applicable to the following classes of persons:-
G
"I. Every person, against whom no arrears of rent in respect of the
property in his lawful possession are outstanding at the"date of
transfer of property.
2. Every person, against whom any arrears of rent in respect of the
property in his lawful possession are outstanding at the date of H
1008 SUPREME COURT REPORTS [2005] 3 S.C.R.

A the transfer of the property, but who has paid up such arrears
within sixty days of such date.
3. Every displaced person having a verified claim against whom any
arrears of rent in respect of the property in his lawful possession
are outstanding at the date of the transfer of the property, but
B such arrears of rent do not exceed the amount of compensation
payable to him.
'
4. Every displaced person having a verified claim against whom
arrears of rent in respect of the property in his lawful possession
exceeding the amount of compensation payable to him are
c outstanding at the date of transfer of the property, but who after
adjustment of the compensation against such arrears pays up the
balance of the arrears within sixty days of the date of such
-
adjustment."

Bhagwan Das admittedly was not a displaced· person and, therefore, not
D covered under categories 3 and 4 of the notification. He would also not fall
under categories l and 2 as admittedly he did not pay the arrears of rent due
within 60 days of the transfer. This is clear from the fact that Department had
issued demand notice Ext. D-6 much after the transfer of the property, in the
year l 970, to the respondents to pay the arrears of rent from 8.8.1955 i.e.
E from the inception of the tenancy till its sale in favour of the appellant on
27.7.1961.

Learned counsel for the respondent then contended that the respondent
or. his predecessor-in-interest did not either have the notice or the knowledge
of the transfer of the property in favour of the appellant and, therefore, the
F period of 60 days should ~e counted from the date of acquiring the knowledge
of this fact by the resp~.:dent in the year 1978. This contention cannot be
accepted because of the clear provision of the notification which requires
payment of the arrears within 60 days of the date of transfer. Bhagwan Das,
predecessor-in-interest, of the respondent knew that the property is likely to
be sold and because of this, he filed the Writ Petition(C) No. 438-D of 1958
G seeking a mandamus directing the Department to pennit him to participate in
the sale of suit property being the occupant/tenant of the same. The writ
petition was allowed and Bhagwan Dass was permitted to participate in the
sale of the suit property which was to be held either by open auction or by
inviting tenders. The Department had issued advertisement in different
H newspapers inviting tenders. Bhagwan Dass did not respond to the
HANS RAJ BANGA v. RAM CHANDER AGGARWAL [BHAN,.!.] 1009

advertisement and submit his tender. Assertion made by the respondent that A
the Bhagwan Dass did not come to know about the advertisement inviting
tenders for the sale of the property or that he did not come to know about
the sale of the property in favour of the appellant cannot be accepted.
Knowledge of this fact would be personal to Bhagwan Dass and there is
nothing on record to show that Bhagwan Dass did not come to know about
the sale of the suit property in favour of the appellant. Bhagwan Dass died B
in the year 1962. On 27.7.1961 the payment was required to be made within
60 days from the date of sale, i.e., upto 27.09.1961. Since Bhagwan Dass did
not fulfil the condition of payment of rent within 60 days from the date of
the sale he did not become the tenant of the appellant. Respondent being the
successor-in-interest of Bhagwan Dass would acquire/inherit whatever C
Bhagwan Dass possessed. As Bhagwan Dass did not become the tenant of the
appellant the respondent being the successor-in-interest of Bhagwan Dass
would also not become the tenant of the appellant.

For the reasons stated above, the appeal is accepted. The judgment and
decree passed by the High Court is set aside and that of the trial Court is D
restored. There will be no order as to costs.

N.J. Appeal allowed.