Holding

The declaration that Khatiawad Industries Ltd. is an evacuee property stands; the single judge's interference was unjustified.

Summary

The case concerned a claim by Ahmed Ebrahim, a Burmese citizen, that he had purchased six lakh shares of Khatiawad Industries Ltd., a company declared an evacuee property in 1959, and that the declaration was illegal because notice under Section 7 read with Rule 6 of the Administration of Evacuee Property Act, 1950, had not been served. The High Court had held the declaration illegal, but the Supreme Court found that the respondent failed to produce convincing evidence of the share purchase and that the opportunity to adduce evidence was afforded. Consequently, the Court held that the single judge was not justified in interfering with the declaration of the company as evacuee property. The appeals were allowed and the writ petition dismissed, leaving the declaration intact.

Issues considered

Whether the failure to serve notice under Section 7 read with Rule 6 of the Administration of Evacuee Property Act, 1950, invalidates the declaration of a company as evacuee property.
Whether a Burmese citizen who was never an evacuee can claim ownership of shares in an evacuee company.
Whether the single judge erred in interfering with the declaration of the company as evacuee property.

Legislation cited

Administration of Evacuee Property Act, 1950s. 27, s. 7

Subjects

evacuee propertynotice requirementshare purchasecitizenshipdeclaration of evacuee companysingle judge jurisdictionevidence

Judgment

J.R. JANI AND ORS. A
v.
AHMED EBRAHIM OF RANGOON

FEBRUARY 14, 1996

[K. RAMASWAMY ANDS. SAGHIR AHMAD, JJ.] B

Administration of Evacuee Property Act, 1950/Rules :

Section 7/Rule 6-Purchase of shares of a company declared as an
evacuee company-Purchaser claiming to be not an evacuee-Legality of the
declaration that the company was an evacuee company-Single Judge of High
c
Cow1 holding that such a declaration was illegat-On appeal held, nothing
placed on record to establish that the pmty purchased six lakhs shares from
the Company declared to be an evacuee property-Single Judge not justified
in inte1fening with the declaration that the company was an evacuee property.
D
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 757-59
of 1975.

From the Judgment and Order dated 19.2.73, 27.9.71 and 24/25-11-
1969 of the Gujarat High Court in LP.A No. 85/70, Misc. C.A. No. 661/70
and S.C.C. A No. 893 of 1965. E
V.V. Vaze, C.V.S. Rao and Y.P. Mahajan, for the Appellants.

The following Order of the Court was delivered :

Though the respondent initially had appeared through Shri l.N.
F
Shroff, Advocate, on his demise, notice was issued on February 29, 1992
to the address available on record and till date nobody appears for the
respondent. Neither unserved envelope nor acknowledgment has been
received. Under these circumstances, the notice must be deemed to have
been served on the respondent.
G
These appeals by special leave arise from the order of the Division
Bench of the High Court of Gujarat dated February 19, 1973 made in
L.P.A. No. 85170 holding that the L.P.A. is not maintainable. Therefore,
the appellants have challenged the original order of the learned single
Judge dated November 24-25, 1969 made in Special Civil Application No.
m~~ H
647
648 SUPREME COURT REPORTS . [1996] 2 S.C.R.
( ·-
A The substance of the contention raised and answered in the High
Court was that the respondent was at th~ material point of time a Burmeese
citizen and he was never an evacuee. He held the shares of the Khatiawad
Industries Ltd., a company, in former Junagadh State, which was declared
as an evacuee company in 1959. He claimed that in the memory of his
father and grand-father Ibrahim Vali Mohammed and Company he pur-
B chased six lakhs shares in the said Khatiawad Industries Ltd. under an
agreement dated June 12, 1944. He and his brothers had agreed to give
those shares. to him. He all along was a resident of Burma. Consequently,
he was not an evacuee. Without notice to him under Section 7 read with
Rule 6 of the Administration of Evacuee Property Act, 1950 and the Rules,
C the declaration of the said Khatiawad Industries Ltd. as an evacuee proper-
ty is illegal. The learned single Judge has held that though the respondent
has filed a revision under Section27 of the Act since notice under Section
7 read with Rule 6 was not served on the respondent, the declaration that
the Khatiawad Industries Ltd. is an evacuee property is illegal and then::-
D fore, a 11011-est.

The question is : whether the view taken by the High Court is correct ...-
in law? It is seen that the respondent had filed a revision before the
revisional authority under Section 27 who had given him an opportunity to
,. adduce evidence to show that he had purchased shares of a value of Rs.
E 94,000 which he claimed to have have had in Khatiawad Industries Ltd.
Except producing a stamp paper of 8 annas value on which there was a
mention of the purchase of the shares in the name of Ibrahim Vali
Mohammed and Company, no other evidence was adduced. The revisional
authority on weighing the evidence found that the respondent was a
F business Tycoon having business interest in all over the Asian countries; it
would be unlikely that he would not have mentioned in any of the books
of acco~nts about the purchase of value of shares worth a sum of Rs. 94,000
and odd without being submitted to any authorities for income tax pur-
poses etc. The agreement on stamp paper was not attested by any
Magistrate or by a Notary as was in vogue in that State. It was, therefore,
G difficult to believe that the respondent had purchased 6 lakhs of shares of
Khatiawad Industries Ltd. for a sum of Rs. 94,000 and odd. Thereby, he
had not shown that he had not an interest in the evacuee property. It is
seen that though there is no notice served on the respondent as required
under Section 7 of the Act read with Rule 6 of the Rules before declaring
H Khatiawad Industries Ltd. to be an evacuee property, at a revision, an
J.R. JANI v. AHMED EBRAHIM OF RANGOON 649

opportunity was given to the respondent to. adduce evidence to prove that A
he had held the shares of Khatiawad Industries Ud. of the value of Rs. six
lakhs for a sum of Rs. 94,0000 and odd. Even though the respondent had
appeared initially through counsel, nothing has been placed on record of
this Court at least to esthablish that he had purchased six lakhs shares of
a value of Rs. 94,000 and odd from Khatiawad Industries Ltd. which was B
declared to be an evacuee property. Untter those circumstances, we think
that the learned single Judge was not justified in interfering with the
declaration that the Khatiawad Industries Ltd. is an evacuee property.

The appeals are accordingly allowed and the Writ Petition stands
dismissed. No costs.
c
G.N. Appeals Allowed and petition dismissed.