THE STATE OF WEST BENGAL AND ANR.versusARUN KUMAR BASU AND ANR.

              THE STATE OF WEST BENGAL AND ANR.                                  A
                                      v.
                    ARUN KUMAR BASU AND ANR.

                               APRIL 4, 1997

            (K. RAMASWAMY AND G.B. PATTANAIK, JJ.]                               B

        West Bengal Estates' Acquisition Act, 1953 : Sections 2(i), 4(i),
5,6, (l)(c), (j) and JO.

        West Bengal La11d Refonns Act, 1956 : Sectio11 3A.                       c
        Land Acquisition-Proceedings-Issue of Notification under Section
4( 1)-Notifying the vesti11g of the Estate i11 the State-Effect of-Held as a
co11sequence, the pre-existi11g right, title a11d interest held by the Compa11y and
vested i11 its liquidators for sale of prope1ty stood vested i11 the State free from
all e11cumbra11ces-Mere inactio11 011 the palt of the Collector i11 11ot taki11g D
possession of the land does not have a11y effect on vesting-Rejectio11 of
co11te11tio11 that the Act has 110 applicatio11 to 11011-agricultural land-Sectio11
6( l)(j) applies only to the agricultural la11ds or to the busi11ess of fan11-
i11g---R.ailway Company is not engaged in the business of fan11ing-171erefore,
it has no applicatio!t-Proprieta1y rights having been abolished by operation E
of Section 4( 1) of the Act, Section 3A of the Land Refonns Act in this regard
has 110 application.

      State of West Bengai & Ors. v. Suburban Agriculture Dairy & Firsheries
Pvt. Ltd., (1993] Supp. 4 SCC 674, referred to.
                                                                                  F
        CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3006 of
1997.

     From the Judgment and Order dated 5.3.93 of the Calcutta High
Court in A No. 465 of 1991.
                                                                                 G
     Tapas C. Ray, H.K. Puri, Rajesh Srivastava and Ujjwal Banerjee for
the Appellants.

     P.B. Menon, Ms. Vijay Lakshmi Menon and Rohit Choudhary for
the Respondents.                                                 H
                               653
    654                  SUPREME COURT REPORTS                   [1997) 3 S.C.R.

A         The following Order of the Court was delivered :

         Delay condoned. Leave granted. This appeal, by special leave, arises
    from the judgment of the Calcutta High Court made on March 5, 1993 in
    Appeal No. 465/91.

B         The admitted position is that the respondents are liquidators of
    erstwhile West Bengal Provincial Company Ltd. Proceedings have been
    placed before us to establish that the Bengal Government had acquired the
    land applying Chapter 8 of the Land Acquisition Act (1 of 1894) and
    delivered possession of the land admeasuring 30 miles for laying the railway
C   line. The specification of the land attached were given in Schedule-B to
    the acquisition Proceedings.

           The notification under Section 4(1) of the West Bengal Estates
    Acquisition Act, 1953 (for short, the 'Act') was published on April 16, 1954
    w.e.f. April 15, 1955 notifying the vesting of the estate in the State. The
D   consequence have been provided in Sections 4(1), 5 and 6 of the Act with
    a 11011-obsta11te clause excluding the applicability of any other provisions
    under Section 3 of the Act. As a consequence, the pre-existing right, titled
    and interest held by the company and vested in its liquidators for sale of
    the property, stood divested by operation of Section 4(1) of the Act and
E   vested in the State. The consequences of the notification and vesting have
    been considered by this Court in State of West Bengal & Ors. v. Suburba11
    Agriculture Dairy & Fisheries Pvt. Ltd., [1993] Supp. 4 SCC 674. This Court
    had held thus :

             "Admittedly, the Act came into force on February 12, 1954.
F            Notification under Sections 4(1) and (3) was published in the
             prescribed manner specifying the date of vesting of the estate and
             had come into effect from June 1, 1956. By operation of sub-section
             (1) of Section 5 the estate and all the rights of intermediaries
             including firsheries in the estate shall stand determined and ceased
             and stood vested in the State free from all incumbrances. "In-
G            cumbrance" defined under Section 2(h) of the Act means "in
             relation to estates and rights of intermediaries therein, does not
             include the rights of a raiyat or of an under-raiyat or of a non-
             agricultural tenant, but shall, except in the case of land allowed to
             be retained by an intermediary under provisions of Section 6,
H            include all rights or interests of whatever nature, belonging to
                       STATE v. AK. BASU                              655

--   intermediaries or other persons, which relates to lands comprised A
     in estates or to the produce thereof'. Therefore, title to rights or
     interests in lands which include fisheries held by an intermediary
     shall stand extinguished and ceased and stood vested in the State
     free of all incumbrances. The respondents being purchasers of
     leasehold interest in tank fisheries, as per their own case, it also
     stood extinghished. But, however, since the appellant treated the B
     respondent as intermediary, we proceed on that footing. The
     exceptions engrafted in the incumbrance and exempted from the
     operation of Sections 4 and 5 are only the rights of a raiyat or of
     an under-raiyat or of a non-agricultural tenant and the right of
     retention of possession allowed to an intermediary under Section C
     6 of the Act. All other rights, interest of whatever nature or title
     belonging to the intermediaries or other persons who hold the
     lands under lease from an intermediary should also stand extin-
     guished. All grants and confirmation of title, to estates and rights
     therein, to which the declaration of vesting applies and which
     were made in favour of intermediaries shall stand dismissed and D
     ceased by operation of Section 5(1)(b) of the Act.

         Section 6 postulates by a non obstante clause that notwithstand-
     ing anything contained in Sections 4 and 5 an intermediary shall,
     except in the cases mentioned in the proviso to sub-section (2) but    E
     subject to the other provisions of that sub-section, be entitled to
     retain with effect from the date of vesting, various of lands like
     homestead etc. enumerated therein including 'tank fisheries' means
     "a reservior or place for the storage of water, whether formed
     naturally or by excavation or by construction of embankments,
     which is being used for pisciculture or fishing, together with the
                                                                            F
     sub-soil and the banks of such reservoir or place, except such
     portion of the banks as are included in a homestead or in a garden
     or orchard and includes any right of pisciculturc or fishing in such
     reservoir or place".
                                                                            G
     On the issue of notification under Section 49, Section 52 prescribed
     procedure to deal with raiyats and un<ler-raiyats covered in Chap-
     ter II etc. It says that the provisions in Chapter II shall with such
     modification as may be necessary apply mutatis m11ta11dis to raiyats
     or under-raiyats as if such raiyats or non- raiyats (sic under-raiyats) H
    656                  SUPREME COURT REPORTS                   [1997) 3 S.C.R.

A           were intermediaries and the land held by them were estates and
            such a person holding under a raiyat or an under-raiyat were a
            raiyat for the purpose of clauses (c) and (d) of Section 5, provided
                                                                                     -
            that, where a raiyat or an under-raiyat retains under Section 6 any
            land comprised in a holding, then notwithstanding anything to the
            contrary contained in sub-section (2) of Section 6, he shall pay the
B           rent as prescribed in clauses (a) to (d) thereto. Under section 5(c)
            every raiyat holding any land under an intermediary shall hold the
            same directly under the State as if the State had been the inter-
            mediary and on the same terms and conditions as immediately
            before the date of vesting. Thus the right, title and interest of a
c           raiyat or under-raiyat in the lands in his possession and enjoyment
            arc saved. By operation of law they became full owners thereof
            subject to the terms and conditions that may be imposed under
            Section 52 and payment of Jama existing on the date of notification
            or revised from time lo time and finally entered in Record of
            Rights.
D
            The pre-existing rights of the intermediaries in the estate to which
            the declaration applied shall stand vested in the State free from
            all incumbrances. Section 6 does not have the effect of divesting
            the State of the vested right, title and interest of the intermediary.
E           One of the rights i.e. possession held by the intermediaries is the
            only interest saved by Section 6 from the operation of Sections 4
            and 5. The fishery rights also stood vested. The pre-existing rights,
            title and interest therein also shall stand determined as against the
            State and ceased. The Collector had symbolic possession under
            Section 10. But by use of non obstente clause in Section 6(1) the
F
            respondent became entitled to retain khas possession of tank
            fisheries, and he shall hold tank fisheries directly under the State
            on such prescribed terms and conditions and subject Lo payment
            of such rent as may be determined under the Act from time to
            time as finally entered in Record of Rights."
G
          As a consequence, the right, title and interest held by the proprietary
    company within the meaning of Section 2(i) of the Act, stood vested in the
    State free from all encumbrances.

H         It is sought to be contended by the learned counsel for the respon-
                          STATEv. AK. BASU                              657

dent that though notice under Section 10 was issued by the Collector for A
surrender of the possession, it was withdrawn and that, therefore, the
vesting does not apply to the company. We find no force in the contention.
Once the land stood vested in the State free from all encumbrances, by
operation of Section 4(1) of the Act, lhe mere inaction on the part of the
Collector in not taking possession of the land does not have any effect on B
vesting, which statutorily operated under section 4(1) of LI:!! Act. It is then
contended that it being a non-agricultural land, the Act has no application.
We find no force in the contention. By operation of Section 6(1)(c), all
non-agricultural lands including the tenancy rights, if any, under the land
held by third parties stood vested in the State except to the extent of 15
acres of the land to which the company is entitled to retain title to and C
possession of the same. It is then contended that under Section 60), it
being the company, the land does not vest in the State. We are unable to
agree with the learned counsel. Section 6(1)0) applies only to the agricul-
tural lands or to the business of farming. Railway company is not engaged
in the business of farming. Therefore, it has no application.
                                                                               D
      It is then contended that by operation of Section 3A of the West
Bengal Land Reforms Act 1956, the non-agricultural land does not stand
vested. We find no force in the contention. What is vested under Section
3A of the Land Reforms Act is the tenancy rights in a non-agricultural
land; and not the proprietary right. Proprietary rights having been            E
abolished by operation of Section 4(1) of the Act, Section 3A of the Land
Reforms Act in this regard has no application. It is then contended that
direction may be given to the State Government to pay the compensation
to which the respondents are entitled to. We need not dwell upon that for
the reason that if the respondents are entitled to any compensation under
the Act and if the State is liable lo pay for it, it is open to them to make   F
necessary application. It is needless to mention that the competent
authority would consider and dispose it of in accordance with law.

      The appeal is accordingly allowed. The appeal and writ petition
stands dismissed. No costs.
                                                                               G
T.N.A.                                                     Appeal allowed.