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Supreme Court of India

NARAYAN BHIMJI VADANGALE AND ANR.versusHUKUMCHAND CHUNILAL THOLE AND ANR

Citation
1991 INSC 327
Decided
6 December 1991
Disposal
Appeal(s) allowed

Holding

A firm is deemed an agriculturist based on the cultivation activities of its partners, and the auction sale is void under Section 63 because it causes the partners' joint‑family holding to exceed the statutory ceiling.

Summary

The decree-holder firm obtained a money decree against a judgment debtor and, during execution, the debtor's agricultural land was attached and auctioned, with the firm emerging as the successful bidder. The heirs of the debtor filed an objection under Section 47 of the CPC, alleging that the sale violated Section 63 of the Bombay Tenancy and Agricultural Lands Act, 1948 because the firm was a non‑agriculturist. The Executing Court upheld the objection, but the High Court reversed, holding that a firm, being an inanimate entity, could neither be an agriculturist nor a non‑agriculturist. The Supreme Court held that a firm is deemed an agriculturist if its partners cultivate the land, and therefore the status of the firm depends on the activities of its partners. It further found that the partners, being members of a joint family, already exceeded the ceiling limit, making the auction sale void under Section 63. Consequently, the appeal was allowed, restoring the Executing Court's decision and setting aside the High Court judgment.

Issues considered

  • Whether a firm can be classified as an agriculturist or non‑agriculturist under the Bombay Tenancy and Agricultural Lands Act, 1948.
  • Whether the auction sale to the firm violates Section 63 of the Act when the partners' holdings exceed the ceiling limit.
  • Whether the status of the firm should be determined by reference to the activities of its partners under Section 85‑A.
  • Whether the High Court's view that an inanimate firm cannot be an agriculturist is legally correct.

Legislation cited

Subjects

auctionagricultural landfirmagriculturistceiling limitSection 63Bombay Tenancy and Agricultural Lands Actexecution of decreeobjection petitionSupreme Court

Judgment

                NARAYAN BHIMJI VADANGALE AND ANR.                                A
'                                       \i.
               HUKUMCHAND CHUNILAL THOLE AND ANR.

                              DECEMBER 6, 1991

              [MADAN MOHAN PUNCHHI AND G.N. RAY, JJ.]                            B
         Bombay Tenancy and Agricultural Lands Act, 1948.

          Sections 2(2), 63 and 85-A-Firm purchasing agricultural land in court
    auction in execution of decree-Whether firm agriculturist or non-agricultur-
    ise depends Upon activities of its partners-Pariners, agriculturists and mem- C
    bers of joint family, holding land beyond the ceiling limitr-Whether auction
    sale in favour offirm vaiid.

          In execution of the decree for recovery of a sum of money obtained
    by the respondent·firm, the agricultural land of the judgriient·debtor was
    attached and put to auction and the decree holder-firm with due permis- D
    sion of the Court emerged as the successful bidder in the auction. The
    auction was later confirmed by the Executing Court, but before the
    isSuance of the sale certificate, the appellants, heirs of the judgment·
    debtor, moved an Objection Petition under Section 47 of the Code of Civil
    Procedure before the Executing Court on the ground that the auction sale E
    was violative of Section 63 of the Bombay Tenancy and Agricultural
    Lands Act, 1948 inasmuch as the decree-holder firm was non-agricultur·
    ist. This objection was upheld by the Executing Court and affirmed in
    appeal, but the same was reversed by the High Court on the view that the
    firm being an inanimate person could neither be an agriculturist nor a
    non-agriculturist. Hence, the heirs of the Judgment-debtor filed an appeal F
    before this Court.

         Allowing the appeal, this Court,

          HELD : 1.1 When a firm is said to be cultivating land, it means that
    U is the partners of the firm who cultivate the land and in that sense the G
    firm cultivates it personally. The firm may be inanimate but the partners
    comprising thereof are people in flesh and blood. Whether the firm is
    agriculturist or non-agriculturist would depend upon the activities of its
    partners. [241 D]

         1.2 In the instant case, in order to determine as to whether the H

                                       239
    240              SUPREME COURT ~.EPORTS                 [1991) SUPP. 3 S. C.R.     f
A partners or the firm were agriculturist or not, the Executing Court
    referred the issue to the revenue Court for trial under Section 85-A of the
    Bombay Tenancy and Agricultural Lands Act, 1948 and on the basis of its            t
    finding that both the partners or the firm ·were agriculturists, but as
    members or a joint family their holding was reckoned as such and was
    beyond their ceiling Omit, it sustained the objection o( the appellant and
B   held that the auction sale was violative or Section 63 or the Act. (241 E]
                                                                                       ...I
        1.3 Under Section 63 or the Act no person, including a Hindu joint             I
  family, could purchase area which would go to exceed the ceiling area to
  which he or it was entitled. It is' undisputed that the auction sale in the
  instant case has gone to swell the area of the joint family, members or
C which were the two partners comprising the firm so as to exceed the ceiling
  area. Hence, the auction sale in favour or the respondents is void under
  sectfon 63 of the Bombay Tenancy and Agricultural Lands Act, 1948.
                                                                      (241 F]

          CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1903 of 1979
D
        From the Judgment dated 12.1.1979 of the Bombay High Court in
    Appeal No. 625 of 1975.                 ·

          P.H. Parekh and BN. Agm;wal for the Appellants.
E         VN. Ganpule, A.B. Lal and Mrs. V.D. Khanna for the Resi)ondents. ·

          The following order of the Court was delivered :

          This appeal by special leave is directed against the judgment and order
F   dated 12.1.1979 of the High Court of Bombay passed in Second Appeal No.
    625of1975.
         The appellants herein are heirs of the original judgment-debtor. The
  respondents herein is the decree holder firm. The decree holder firm as plaintiff
  filed a suit for recovery of a sum of money against the Defendant judgment-
  debtor. The suit was decreed. In execution thereof some agricultural land of the
G judgment-debtor was attached and put to auction. The decree holder firm with
  due permission of the Court emerged as the successful bidder at the auction.
  The auction was later confirmed by the Executing Court and a sale certificate
  was issued to the firm.
          In the meantime, before the issuance of the sale certificate, the heirs of
H the judgment-debtor moved an Objection Petition under Section 47 of the Code
                  NARAYAN BHIMJI v. HUKUMCHAND                                241

of Civil Procedure before the Executing Court on the ground that the auction A
sale was violative of Section 63 of the Bombay Tenancy and Agricultural
Lands Act, 1948 inasmuch as the decree holder firm was non-agriculturist.
This .objection found favour with the Executing Court and was affirmed in
appeal but the same was reversed by the High Court. The High Court took the
view that the firm being an inanimate person could neither be an agriculturist
nor a non-agriculturist. For the view taken the High Court took in aid the B
definition of the word 'agriculturist' contained in Section 2(2) of the aforesaid
Act which meant a person who cultivates the land personally. Since the firm
as such was held by the High Court to be incapa,ble of personal cultivation the
auction sale was taken out of the purview of Section 63 of the Act resulting in
the dismissal of the Objection Petition giving rise to the present appeal.

       Now we are required to examine whether the view taken by the High
                                                                                     c
Court in treating the firm as inanimate, incapable of personal cultivation of
agricultural land is correct or otherwise. No elaboration is necessary to
understand the legal composition of a firm and its personality which is a name
given compendiously to a group of people who comprise its partners, and those
people have naturally to be live persons. When we talk of a firm cultivating
land we mean to convey that it is the partners of the firm who cultivate the land    D
and in that sense the firm cultivates it personally. the firm may be inanimate
but the partners comprising thereof are people in flesh and blood. On this
analysis the basis of the judgment of the High Court gets knocked off. Whether
the firm is agriculturist or non-agriculturist would depend upon the activities
of its partners. It is worthwhile to mention here that in order to· determine as
to whether partners of the fitm were agriculturists or not the Executing Court       E
ventured to send to the revenue Court for trial an issue to that effect under
Section 85-A of the said Act as required by law. The revenue Court returned
the finding that both the partners of the firm were agriculturists but as members
of a joint family their holding was reckoned as such and was beyond their
ceiling limit. Relying on such finding the Executing Court sustained the
objection. But it was obvious that under Section 63 of the said Act no person,       F
including a Hindu Joint Family, could purchase area which would go to excee9
the ceiling area to which he or jt was entitled. It is undisputed that the auction
sale has gone to swell the area of the joint family; members of which were the
two partners comprising the firm, so as to exceed the ceiling area. This being
the position it inevitably follows that the auction sale in favour of the
respondents herein has to be declared as void under Section 63 of the Bombay         G
Tenancy and Agricultural Lands Act, 1948. The objection is thus sustained, the
judgment and order of the High Court is set aside and that of the Executing
Court as confirmed by the First Appellate Court restored. In the circumstances
                                              ,.
of the case there shall be no order as to costs.

N.P.V.                                                          Appeal allowed.


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