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Agricultural Land – To Will Away or Not to?

Analysing the judgment of the Apex Court in Vinodchandra Sakarlal Kapadia & Ors. v State of Gujarat & Ors.


Author: Anushka Merchant


Introduction

The Bombay Tenancy and Agricultural Lands Act 1948 (‘Tenancy Act’) came into force in the State of Maharashtra, on 28th December 1948.[1] [RB2] [AM3] [1] A few years later, the Tenancy Act was adapted and modified by the State of Gujarat and in 2011, the act came to be known as the Gujarat Tenancy and Agricultural Lands Act 1948, in Gujarat.[2] The Tenancy Act amended the law relating to tenancies and relating to the relations of landlords and tenants of agricultural lands. The Tenancy Act aimed to improve the social and economic conditions of peasants and to ensure the full and efficient use of land for agriculture by the regulation of transfers of agricultural lands, sites, dwelling houses and appertaining lands possessed or occupied by agriculturists, agricultural labourers and artisans.[3]


In and around 2009, several references were made to the Gujarat High Court in respect of the following two issues, which pertain to testamentary dispositions of land under the Tenancy Act, as applicable to the State of Gujarat:


(i) Whether the restriction on the transfer of agricultural land to a non-agriculturist under S. 63 of the Tenancy Act debars a transfer by way of a testamentary disposition?


(ii) Whether the restriction on the transfer of land under S. 43 of the Tenancy Act, purchased by a tenant under SS. 17B, 32, 32F, 32I, 32O, 32U, 33(1) or 88E and sold by a tenant under SS. 32P or 64, restricts a transfer by way of a testamentary disposition?[4]


These issues were dealt with by a Division Bench of the Gujarat High Court in Rajenbhai Baldevbhai Shah v Baijiben Kabhaibhai Patanvadia & ors (‘Rajenbhai’).[5] The case went into further appeal before the Supreme Court of India and on 15th June 2020, a three member bench of the court delivered its judgment in Vinodchandra Sakarlal Kapadia & ors v State of Gujarat & ors,[6] (‘Vinodchandra’) wherein it finally determined the aforesaid issues.


Deconstructing the Decision

In arriving at its judgment in Vinodchandra, the Supreme Court of India discussed several judicial pronouncements and legal principles.

A. Judicial Overview


The court took into account the following judicial decisions pertaining to testamentary dispositions of land or an interest therein:


1. Bhavarlal Labhchand Shah v Kanaiyalal Nathalal Intawala[7] (‘Bhavarlal’): In 1986, a two member bench of the apex court dealt with the question as to whether a tenant governed by the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 could ‘will away’ their tenancy in spite of the prohibition against transfer or assignment contained under S. 15 of the act. In delivering the decision, Venkataramiah J. opined that a tenant cannot bequeath their tenancy rights in favour of a stranger by way of a testamentary disposition and that in case such a disposition was made, the landlord would not be bound by such bequest and would not be bound to recognise the legatee as a tenant of the demised premises.[8]


A similar view was taken by the apex court in two later decisions pertaining to testamentary dispositions of agricultural holdings in the State of Karnataka.


2. Sangappa Kalyanappa Bangi (D) through Lrs v Land Tribunal, Jamkhandi & ors[9](‘Sangappa’): In 1988, a two member bench of the Supreme Court of India delivered a judgment wherein it interpreted the term ‘assignment’ used under S. 21 of the Karnataka Land Reforms Act 1961, which prohibits sub-division, sub-letting and assignment of land or any interest therein. The question before the bench was whether a devise under a will would amount to an assignment of interest in land under S. 21 and whether the same would, therefore, be invalid. In interpreting the term ‘assignment’, Babu J. opined that the same would have to be given such a meaning as would promote the object of the enactment, which was to disallow strangers to the family of the tenant from coming upon the land. Accordingly, the court held that a devise under a will would amount to an assignment and, therefore, would not be valid for the purpose of S. 21 of the act.[10]


3. Jayamma v Maria Bai Dead by proposed Lrs & ors[11] (‘Jayamma’): In 2004, the view taken in Sangappa was reiterated by a two member bench of the apex court while interpreting S. 61 of the Karnataka Land Reforms Act, 1961, which deals with the restriction on the transfer of land of which a tenant has become an occupant.[12]


4. Rajenbhai[13]: In 2009, the Gujarat High Court held that the term 'assignment' used in S. 43 of the Tenancy Act must be given the same meaning as was attributed to it in Sangappa and further observed that although S. 63 of the Tenancy Act did not contain the word 'assignment', permitting alienation of such land through a testamentary disposition would be against the public policy and would defeat the very object and purpose of the Tenancy Act. In this case, Radhakrishnan J. observed that statutory tenancies could neither be devised by a will nor could they become subject to the rules of intestacy.[14]


5. Mahadeo v Shakuntala[15](‘Mahadeo’): A contrary view was taken by a two member bench of the apex court in 2016 while interpreting the term ‘assignment’ under S. 57 of the Tenancy Act as applicable to the Vidarbha Region of the State of Maharashtra, which deals with the restriction on a transfer of land purchased or sold under the Tenancy Act. Lokur and Goel JJ. held that:

on a plain reading of the aforesaid provision, it is clear that transfer without the previous sanction of the Collector is impermissible by way of sale, gift, exchange, mortgage, lease or assignment. There is no prohibition insofar as the transfer of land by way of a will is concerned.[16]

However, it is pertinent to note that the decision in Mahadeo does not show that the attention of the bench was invited to the earlier decisions of the court in Bhavarlal, Sangappa and Jayamma.

B. Prohibition in State Legislation v Principles of Central Legislation


Another cause for concern in Vinodchandra was that if S. 43 and other allied provisions of the Tenancy Act were considered in light of the principles laid down in Bhavarlal, Sangappa and Jayamma, which aimed to sub-serve the purpose of protecting the holdings in the hands of disadvantaged categories, it may appear that the prohibition contained in the Tenancy Act, a state legislation, may not be fully consistent with the principles of the Indian Succession Act, 1925, a central legislation.[17]


However, Lalit J. provided a clarification in respect of the same and observed that:

even if by the process of construction, the expression ‘assignment’ is construed to include testamentary disposition, in keeping with the settled principles, the incidental encroachment cannot render the said provisions invalid. In pith and substance, the legislation and the concerned provisions are completely within the competence of the State Legislature and by placing the construction upon the expression ‘assignment’ to include testamentary disposition, no transgression will ensue.[18]


Conclusion


SS. 43 and 63 of the Tenancy Act expressly prohibit transfers by way of sale, gift, exchange, mortgage, lease or assignment. On a reading of these provisions, it becomes clear that the primary legislative intent is to prevent strangers and non-agriculturists, who may not cultivate the land personally or who may engage strangers as tenants on the land, from entering upon the land. The common thread running through the judicial decisions in Bhavarlal, Sangappa, Jayamma and Rajenbhai is that in each of these cases, the court construed the prohibition against transfer appearing in the various statutes in a liberal, purposive and beneficial manner in order to keep with this legislative intent.


Although tenancy rights are heritable, the ‘right to inherit’ has been restricted by certain legislations to include devolution by intestate succession but to exclude devolution by testamentary succession. In Jaspal Singh v Additional District Judge, Bulandshahar & ors,[19] the apex court observed that the word ‘heir’ could be construed in both a wide and a narrow sense and the construction to be chosen for a given case would depend upon the object and purpose of the legislation in respect of which the question arises. The construction chosen would then enable the court to determine whether or not tenancy rights could be devised by a will, in a manner that was consistent with the scheme of that particular legislation.[20]


However, in Mahadeo, the apex court upheld the validity of the testator’s bequest of the suit lands on the ground that the applicable provision did not directly and expressly prohibit a transfer by way of a testamentary disposition. As observed by the apex court in Vasant Pratap Pandit v Dr. Anant Trimbak Sabnis,[21]‘if the word “heir” is to be interpreted to include a “legatee” even a stranger may have to be inducted as a tenant for there is no embargo upon a stranger being a legatee’. Thus, in Mahadeo, the bench was incorrect in adopting a literal and strict interpretation, as the same conflicted with the intention of the legislature. Accordingly, in Vinodchandra, the apex court pronounced that Mahadeo had been incorrectly decided.[22] Lalit J. also expressed that if testamentary dispositions, which did not have the element of consideration and which did not attract SS. 43 and 63 of the Tenancy Act were permitted, ‘the legislative intent to do away with absentee landlordism and to protect the cultivating tenants, and to establish direct relationship between the cultivator and the land would then be rendered otiose.’ Therefore, the court upheld the view taken by the Gujarat High Court in Rajenbhai and held that the same did not call for any interference.[23]


[The author is an advocate enrolled with the Bar Council of Maharashtra & Goa.]




Notes and References

[1] Bombay Government Gazette, 1948, Part V. [2] Gujarat Short Titles (Amendment) Act 2011, S. 3. [3] The Bombay Tenancy and Agricultural Lands Act 1948. [4] 2020 SCC OnLine SC 545, [2]. [5] 2009 SCC OnLine Guj 1804. [6] Vinodchandra (n 4). [7] (1986) 1 SCC 571. [8] ibid [5]-[8]. [9] (1998) 7 SCC 294. [10] ibid [5]-[6]. [11] (2004) 7 SCC 459. [12] ibid [13] and [18]. [13] Rajenbhai (n 5). [14] ibid 7. [15] (2017) 13 SCC 756. [16] ibid [5]. [17] Vinodchandra (n 4), [41]. [18] ibid. [19] (1984) 4 SCC 434. [20] ibid [8]. [21] (1994) 3 SCC 481, [15]. [22] Vinodchandra (n 4), [43]. [23] ibid [33]-[34].

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