Page 1 1

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS.6-7 OF 2013

(Arising out of SLP(C)Nos.11221-11222 of 2008)

GHULAM NABI DAR & ORS. … APPELLANTS

Vs.

STATE OF J&K & ORS. … RESPONDENTS

WITH

CIVIL APPEAL NOS.8-9 OF 2013

(Arising out of SLP(C)Nos.14286-14287 of 2008)

J U D G M E N T

ALTAMAS KABIR, CJI.

1.Leave granted.

2.The disputes between the parties relate to

lands measuring 37 Kanals 5 marlas comprised in

several survey numbers forming the subject matter

of OWP No. 480 of 2003 and OWP No. 454 of 2005. On

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21

st

November, 1980, the Custodian of Evacuee

Property, Kashmir, issued a Notification under

Section 6 of the Jammu and Kashmir State Evacuees'

(Administration of Property) Act, 2006, hereinafter

referred to as "the 2006 Act", declaring the

aforesaid land to be evacuee property, being in the

ownership of one Qamar-ud-Din and other evacuees.

Inasmuch as, the writ petitioners in OWP No. 480 of

2003, claiming to the tenants-at-will of the land

involved in the writ petition, commenced earth

filling, they were stopped from doing so by the

Evacuee Department. It is the case of the writ

petitioners that when they made inquiries, they

were able to lay their hands on records indicating

that the lands measuring 11 kanals 6 marlas out of

the land comprised in the said survey numbers had

been taken over by the Evacuee Department and

placed at the supurdnama of the Custodian vide

three seizure memos dated 22

nd

January, 2003 and 1

st

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February, 2003. Claiming that they were in

possession of the land in the capacity of tenants-

at-will since before the aforesaid Act came to be

enacted, the petitioner in OWP No. 480 of 2003

prayed for the following reliefs:-

"(i) it be declared that Section 6 of

the J&K Evacuee (Administration of

Property) Act, 2006 is

unconstitutional;

(ii) it be declared that Section 3 of

the Agrarian Reforms Act, 1976 in so

far as it excludes the application of

Sections 4 and 8 of the tenants of

evacuee land is ultra vires the

Constitution.

(iii)That by an appropriate writ,

direction or order including the writ

in the nature of certiorari following

notification/communication be quashed:-

1.Notification dated 21.11.1980

2.Communication No.

CEPS/GE/2002/2766-70 dated

17.12.2002.

3.Communication No.CG(EP)1020/

2003/ 167-Misc. K dated 23.1.2003

4.Three seizure memo dated

2.2.2003

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5.Communication No. CEPE-

JE/2002/3347-50 dated 6.2.2003

6.Communication No. DFI/SG/378

dated 22.2.2003

(iv) That by an appropriate writ,

direction or order including a writ in

the nature of prohibition respondents

be restrained from interfering in the

rights of possession of the petitioners

in the land and in their levelling of

land and from fencing.

(v) ........"

Along with the writ petition, the petitioners

also filed a miscellaneous petition seeking interim

relief in which it was ordered that the Respondents

were not to dispossess the petitioners from the

lands in dispute, till the next date. The

petitioners were also restrained from raising any

construction or changing the nature and character

of the said lands during the said period. However,

when during the pendency of the writ petition, the

Custodian started construction of a shopping

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complex, in violation of the said order of

injunction, the petitioners filed another CMP in

which notice was issued on 22nd April, 2004,

returnable within four weeks, and till then the

parties were directed to maintain status quo.

Subsequently, by an order dated 30

th

September,

2004, the Registrar (Judicial) of the High Court

was appointed as Commissioner to visit and submit a

report which he did on 7

th

October, 2004.

3.On receipt of the report and on being satisfied

that construction work had been undertaken by the

Custodian on the aforesaid lands and was being

proceeded with, the High Court by its order dated

19

th

November, 2004, restrained the Respondents from

raising any construction on the spot. Since its

earlier orders had been violated by the Custodian,

the Station House Officer of the concerned Police

Station was directed to see that the order of the

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Court was duly complied with, till the petition was

considered for admission, or until further orders.

4.Aggrieved by the aforesaid order of the learned

Civil Judge, the Custodian of Evacuee Property

filed LPA No. 169 of 2004. Other writ petitioners,

who also claimed to be in possession of their lands

as tenants-at-will and as "protected tenants", have

also challenged the validity of the provisions of

Section 6 of the Jammu and Kashmir Evacuee

(Administration of Property) Act, 2006 and Section

3 of the Agrarian Reforms Act, 1976, insofar as it

excludes the application of Sections 4 and 8 to the

tenants of evacuee properties.

5.While the matters were pending, serious efforts

were made by the parties for an out of court

settlement which ultimately fructified in terms of

a settlement which was submitted before the Court

by way of CMP No. 128 of 2006. The Settlement

presented before the Court was duly signed by the

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Custodian of Evacuee Property, Kashmir and by all

the writ petitioners and their counsel. While the

above miscellaneous petition was pending

consideration, the Advocate General filed an

application on 23

rd

May, 2006, praying that the

Settlement be not accepted, which application was

later withdrawn. In the meantime, there was a

change in the Government and the Custodian was also

transferred. The new Custodian took a decision to

refer the matter back to the State Government. On

10

th

October, 2006, the Custodian filed an

application praying for withdrawal of the

Settlement contained in CMP No. 128 of 2006, and in

support of such application, the Custodian placed

reliance upon a letter of the Revenue Department in

which it was stated that the Revenue Minister had

accorded approval for reversing the earlier

decision taken on 27/28

th

March, 2005, for entering

into a settlement with the occupants of the evacuee

Page 8 8

property. The said application for withdrawal of

the Settlement filed by the Custodian came to be

registered as CMP No. 525 of 2006.

6.The two miscellaneous petitions, being CMP No.

128 of 2006, filed by the parties for disposing of

the appeal and writ petitions in terms of the

compromise and CMP No. 525 of 2006, filed by the

Custodian for withdrawal of the Settlement, came up

for consideration before the Division Bench of the

Hon’ble Mr. Justice H. Imtiaz Hussain and the

Hon’ble Mr. Justice Mansoor Ahmad Mir, on 15

th

September, 2007. As indicated hereinbefore, the

Hon’ble Judges differed on the relief prayed for.

While H. Imtiaz Hussain, J. held that the

Settlement violated Rule 13-C of the Jammu and

Kashmir State Evacuees’ (Administration of

Property) Rules, 2008, hereinafter referred to as

“the 2008 Rules” and could not, therefore, be

accepted by the Court, Mansoor Ahmad Mir J. held

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that the aforesaid Rule did not apply to the facts

of the case and that it was nobody’s case, that the

Settlement arrived at was the outcome of fraud or

unlawful. His Lordship was also of the view that

the Settlement having been duly signed and acted

upon by the parties, the same was binding on the

parties and could not be withdrawn unilaterally.

His Lordship, therefore, dismissed CMP No. 525 of

2006, filed by the Custodian for withdrawal of the

Settlement and directed the listing of LPA No. 169

of 2004 and CMP No. 128 of 2006, for further

arguments. In view of such differences, the matter

was referred to Hon’ble the Chief Justice in terms

of Rule 36(2) of the Jammu and Kashmir High Court

Rules, for referring the matter to a Third Judge.

The learned third Judge framed three questions

for consideration, namely,

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(a) whether Rule 13-C of the 2008 Rules is

attracted to the Settlement arrived at by

the parties?

(b) whether the Settlement contravenes Rule

13-C?

(c) whether the Custodian can withdraw from

the Settlement unilaterally?

7.Before the learned third Judge it was sought to

be urged on behalf of the State that the chunk of

the land in question belonged to one Qamar-ud-Din

who had two brothers, namely, Ahmad Din and Imam

Din. In the disturbances of 1947, Qamar-ud-Din left

the State and became an evacuee and his property

was declared as evacuee property. In 1949 or 1950

there was no such record available in the

Custodians Department. Subsequently, Ahmad Din

submitted three applications dated 11

th

Assuj 2009,

before the Custodian of Evacuee properties with a

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request that three bungalows along with the

premises be declared as non-evacuee property as the

entire property was held by the three brothers,

Qamar-ud-Din, Ahmad Din and Imam Din. The said

three applications were dismissed on grounds of

default on 28th July, 1956. An application for

review of the said order was filed on 20th

November, 1956, which was disposed of by the

Custodian by his Order dated 5th September, 1963,

whereby the close relatives of the evacuees were

appointed as managers of the properties provided

they gave an undertaking that they would submit

yearly accounts of income and expenditure to the

Department and deposit the income from the

properties regularly so that the same could be

credited against the names of the evacuees. It was,

therefore, contended on behalf of the State that in

terms of the above Orders, the property came under

the control of the Evacuee Department and was being

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administered through its allottees and managers

appointed by it. It was also the stand of the State

that once the Custodian came into control of the

evacuee properties, he decided to construct a

Shopping Mall over the land and allotted the work

of construction to a contractor, who started

raising the construction thereupon. It was also

urged that notwithstanding the claim of the writ

petitioners to be in possession of the lands as

tenants, their rights, if any, in the land, were

extinguished once the Evacuee Property Act came

into effect and in any case by virtue of the

declaration issued under Section 6 of the 2006 Act.

8.It was also the case of the State that any

allotment of lands belonging to the State could not

have been settled without complying with the

provisions of Rule 13-C of the 2008 Rules and such

contravention invalidated the Settlement which was,

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therefore, illegal and was rightly declared to be

so by H. Imtiaz Hussain, J.

On the other hand, it was contended by Mr.

Shah, appearing for the writ petitioners, that the

Settlement between the parties was in the nature of

a contract and had been arrived at by the parties

who enjoyed the freedom to contract. It was also

submitted by him that Rule 13-C could have applied

if the land to be allotted was vacant. According to

Mr. Shah, since the writ petitioners were holding

the land as tenants, it was not vacant for the

purposes of Rule 13-C of the Rules. According to

Mr. Shah, the views expressed by the Hon’ble

Justice Mansoor Ahmad Mir was in consonance with

Rule 13-C, which in the facts of the case, could

not have any application to the lands in question.

9.It was also contended by Mr. Shah that even

assuming that Rule 13-C was applicable, even then

there was no violation of its provisions as the

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premium was fixed in the present case by taking

into consideration the fact that the writ

petitioners were surrendering all their rights in

respect of the whole land. The premium was fixed by

the members of a committee headed by none else than

the Minister-in-Charge of the Custodian Department.

Mr. Shah also submitted before the learned third

Judge that the rate of Rs.30 lakhs per kanal, as

indicated by the Appellants, was not based on any

relevant material.

10.As mentioned hereinbefore, the controversy in

this case related to the applicability of Rule 13-C

in regard to the land in question.

In his judgment and order dated 25th March,

2008, the learned third Judge, Y.P. Nargotra. J.

agreed with the view taken by H. Imtiaz Hussain, J.

that the parties had violated Rule 13-C of the

above-mentioned Rules and the Custodian was,

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therefore, competent to unilaterally withdraw the

same. The Learned Judge came to such a conclusion

on the ground that in terms of the Settlement

arrived at, the writ petitioners would have to

surrender all their rights over the entire land,

which would render the land vacant within the

meaning of Rule 13-C.

11.On the question as to whether the Settlement

contravened Rule 13-C, the learned third Judge was

of the view that the premium to be paid for the

lease to be granted to the respondents/writ

petitioners under the Settlement had not been

determined by putting the lease to an open auction

which was in contravention of the mandatory

requirement of Rule 13-C. The learned Judge,

therefore, held that the Settlement contravened

Rule 13-C on the point of determining the premium

payable.

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12.On the third question as to whether the

Custodian could withdraw from the Settlement

unilaterally, the learned third Judge held that

Rule 3 of Order 23 CPC, which related to compromise

of suits, would have application provided it was

proved to the satisfaction of the Court that the

suit had been adjusted wholly or in part by any

lawful agreement or compromise. In such case, the

Court would have the discretion to order such

agreement or compromise to be recorded and shall

pass a decree in accordance therewith in so far as

it related to the parties to the suit. The learned

third Judge took note of the Explanation to Rule 3

of Order 23 CPC, which provides that an agreement

or compromise which is void or voidable under the

Contract Act shall not be deemed to be lawful

within the meaning of the Rule. Accordingly, in

terms of the above Explanation, an agreement not

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found to be lawful, could be rejected by the Court

for the purpose of passing a decree.

The learned third Judge then referred to

Section 23 of the Contract Act, 1872, whereby any

agreement which the Court regards as immoral or

opposed to public policy, is void. The learned

third Judge held that the Settlement was directly

hit by Section 23 of the Contract Act as it

defeated the object of Rule 13-C and was,

therefore, unlawful for the purposes of Rule 3 of

Order 23 CPC. The Learned Third Judge held that the

Settlement being unlawful, the Custodian was

entitled to withdraw from the Settlement

unilaterally. Agreeing with the views expressed by

H. Imtiaz Hussain, J., the learned third Judge

observed that by consent or agreement, the parties

cannot achieve what is contrary to law and that the

Settlement arrived at between the parties could not

be accepted.

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13.As a result of the above, while the two

miscellaneous petitions were disposed of by the

High Court, LPA No. 169 of 2004 and OWP No. 480 of

2003, filed by the Appellants challenging the

Notification dated 21st November, 1980, are still

pending decision in the High Court.

14.These two Appeals arise from the final judgment

and order dated 25

th

March, 2008, passed by the

learned third Judge of the Jammu & Kashmir High

Court at Srinagar, in the said miscellaneous

applications.

15.Briefly stated, the grievance of the Appellants

is directed against the order passed by H. Imtiaz

Hussain, J., holding that the Settlement violated

Rule 13-C of the 2008 Rules and could not,

therefore, be accepted by the Court.

16.Appearing for the Appellants, Mr. Zaffar Ahmad

Shah, learned senior counsel, reiterated the

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submissions made before the High Court and

submitted that, although, the Evacuee Department

issued the Notification dated 21

st

November, 1980,

the same was neither gazetted nor implemented till

1999, when an entry was made in the Revenue Records

in that regard. Mr. Shah urged that all the

Appellants were occupancy tenants in respect of the

lands in which they were in possession and such

possession was protected under Section 16 of the

2006 Act. The impugned order of the Custodian

General, being contrary to the said provisions, was

illegal and liable to be quashed.

17.Mr. Shah contended that the lands in question

and the lands comprised in the surrounding areas

were agricultural lands and had been utilised for

cultivation of paddy for decades. There was a

change in user of the surrounding lands, when a

bye-pass road and a new airport was constructed.

As a result of such developments and the expansion

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of the city, a large number of residential houses

and commercial establishments came to be

constructed in and around the area called Hyder

Pora. On account of such unrestrained construction

activities, the level of land used in construction

work was raised considerably on account of earth

filling. The lands of the Appellants, on the other

hand, continued to be low-lying and gradually

became receptacles of water, making them unfit for

cultivation. In order to render the lands usable,

the Appellants also resorted to earth filling to

prevent collection and stagnation of water. It is,

at this stage, that the functionaries of the

Evacuee Department intervened and stopped the

Appellants continuing with earth filling of the

lands in question.

18. Mr. Shah submitted that after purported ex

parte enquiries were made by the Custodian

General's Office, letters were issued to the

Page 21 21

Custodian of Evacuee Property directing him to

resume possession of the lands under the occupation

of the Appellants. However, the Appellants were

kept completely in the dark regarding such enquiry

and the procedure adopted by the Office of the

Custodian General, in arriving at a final

conclusion regarding the status of the land behind

the back of the Appellants, was without legal

sanction and was liable to be quashed.

19. Mr. Shah urged that the Appellants and their

predecessors-in-interest had been holding and

possessing the lands in question much before 14

th

August, 1947, in their capacity as tenants and are,

therefore, protected in law against any action of

the Respondents. Mr. Shah urged that, although,

the Respondents claimed that the property in

question belongs to one Qamer-ud-Din, he was never

in possession of the lands as on 1

st

March, 1947, or

on 14

th

August, 1947 and the predecessors-in-

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interest of the Appellants were all along in

occupation of the property as tenants and, at no

stage, did they cease to occupy the said property.

20.Mr. Shah urged that under Section 5 of the 2006

Act, all evacuee property situated in the State

would be deemed to have vested in the Custodian.

However, in order to vest in the Custodian, the

properties had to be evacuee property. Mr. Shah

submitted that in the instant case, Qamer-ud-Din

was not an evacuee within the meaning of Section

2(c) of the above Act, nor did he acquire the

property in the manner indicated in Section 2(c)

(iii) thereof. Mr. Shah submitted that the

property has not been registered as evacuee

property by the Custodian, in terms of Section 5 of

the 2006 Act.

21.The learned counsel then submitted that Section

6 of the 2006 Act was unconstitutional and was

liable to be struck down. It was urged that before

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issuing a notification under Section 6 of the 2006

Act, it was only incumbent upon the authorities to

ensure that the principles of natural justice were

followed.

22.Mr. Shah contended that the 2008 Rules provide

that in respect of any evacuee property which vests

in the Custodian, but is in the possession of some

other person having no lawful title to such

possession, the Custodian may evict the person from

such property in the manner indicated in the 2006

Act and the 2008 Rules.

23.Mr. Bhaskar Gupta, learned Senior Advocate, who

appeared for the Appellants, Ghulam Mohammad Dar

and others, emphasised the use of the expression

"vacant" in Rule 13-C of the 2008 Rules. Mr. Gupta

submitted that the expression "vacant" has been

defined in Black's Law Dictionary to mean "empty,

unoccupied, absolutely free, and unclaimed".

Accordingly, land in possession of any person prior

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to coming into force of the Act and the Rules,

could not be said to be vacant land and,

accordingly, Rule 13-C of the 2008 Rules would have

no application to the lands in question at all.

24.Mr. Gupta submitted that in terms of the

Settlement which has been arrived at between the

Appellants and the State agencies, the Appellants

had surrendered possession of 22 kanals of prime

land out of 37 kanals and 5 marlas in favour of the

Custodian Department and the Appellants continued

to be in possession of the remaining lands.

Furthermore, according to Mr. Gupta, by the raising

of constructions on the surrendered land, the

Settlement had been duly acted upon and the State

could not, therefore, now resile therefrom. It was

no longer open for the State to contend that they

had wrongly arrived at the Settlement. Mr. Gupta

also pointed out that the fact that the Appellants

were and continued to be in possession of the lands

Page 25 25

in question, would be evident also from a letter

written on behalf of the State Government, in its

Revenue Department, to the Custodian General on

10th October, 2006 regarding the Settlement to be

filed in LPA No. 169 of 2004 and OWP No. 480 of

2003. It was pointed out that, in the said letter,

the State Government had acknowledged the fact that

the Appellants were the occupants of the property

in question, even though such occupation was

referred to as illegal. Mr. Gupta submitted that

what was important was the acknowledgement of the

fact that the Appellants were in actual possession

of the lands in question.

25.It was lastly submitted that Rule 3 of Order 23

CPC permits compromise of suits and where it is

proved to the satisfaction of the Court that the

same had been adjusted wholly or in part by any

lawful agreement or compromise in writing and

signed by the parties, the Court shall order such

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agreement, compromise or satisfaction to be

recorded and then proceed to pass a decree.

26.Mr. Sunil Fernandes, learned counsel, who

appeared for the State of Jammu and Kashmir,

submitted that the two writ petitions regarding

resumption of possession of the lands in question

were still pending before the High Court and the

validity of Section 6 of the 2006 Act was the

subject matter of challenge therein. The ambit of

the dispute between the parties before the High

Court was confined to the question of validity of

Section 6 of the 2006 Act, as also the challenge to

the Settlement arrived at between the parties.

27. Mr. Fernandes urged that the view of the

learned third Judge represented the majority view

in the matter, which did not warrant any

interference. These appeals were, therefore, liable

to be dismissed.

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28.The main plank of the submissions made on

behalf of the Appellants is that the lands in

question are not evacuee property, and, that, the

Appellants were tenants thereof since before the

Act came into force. In fact, it is the case of

some of the Appellants that their predecessors-in-

interest were in occupation of the lands in

question even prior to 1

st

March, 1947, and 14

th

August, 1947, which clearly excluded the Appellants

from the operation of the provisions of the 2006

Act and the 2008 Rules. On the other hand, as

"protected tenants", the Appellants were entitled

to continue in possession of the lands and,

particularly so, in view of the Settlement arrived

at between the Appellants and the State

authorities.

29.That, there was a settlement arrived at between

the parties is not in issue. It is also not in

issue that after filing the Settlement in Court and

Page 28 28

asking the Court to take action thereupon, an

application was made on behalf of the Custodian of

Evacuee Property, Jammu and Kashmir, for leave to

withdraw CMP No. 128 of 2006 on the ground that the

Chief Minister had reversed the earlier decision

taken on 27/28

th

March, 2005 and, that, accordingly,

the deponent, in the affidavit, was not competent

to enter into the Settlement, as the decision to do

so had been withdrawn by the competent authority.

30.The question to be decided is whether having

entered into a Settlement, which stood concluded

and had been acted upon by the State Government by

raising constructions on the surrendered lands,

could the Settlement have been withdrawn

unilaterally only at the instance of the State

Government?

31. The other branch of submissions made on behalf

of the Appellants, which merits consideration, is

whether on Section 8 of the 2006 Act having been

Page 29 29

declared ultra vires, a party could be left without

a remedy as the right to challenge a Notification

issued under Section 6 stood extinguished by such

declaration?

32.In addition to the above, the provisions of

Section 16 of the 2006 Act may also be noticed.

Section 16, which deals with occupancy and tenancy

rights provides as follows :-

"16.Occupancy or tenancy right not

to be extinguished - Notwithstanding

anything contained in any other law

for the time being in force, the

right of occupancy in any land of an

evacuee which has vested in the

Custodian shall not be extinguished,

nor shall an evacuee or the

Custodian, whether as an occupancy

tenant, or a tenant for a fixed term

of any land, be liable to be ejected

or deemed to have become so liable on

any ground whatsoever for any default

of the Custodian."

It is clear from Section 16 that on account of

the non-obstante clause, the provisions of Section

16 will prevail over any other law for the time

Page 30 30

being in force and the right of occupancy in any

land of an evacuee shall not be extinguished.

Accordingly, in the event the tenants were enjoying

occupancy rights in respect of the lands in their

possession, they could not be evicted therefrom by

virtue of the Notification published under Section

6 of the 2006 Act.

However, the protection under Section 16 will

be available only in respect of evacuee property

after a determination to such effect is made. A

unilateral declaration is clearly opposed to the

principles of natural justice and administrative

fair play and cannot be supported.

33.As far as the second limb of Mr. Shah and Mr.

Gupta's submissions is concerned, the same being

the subject matter of the writ proceedings pending

before the High Court, it would not be proper on

our part to express any opinion in respect thereof.

Page 31 31

34.Having considered the submissions made on

behalf of the respective parties, we are inclined

to accept the submission made on behalf of the

Appellants that the Notification published on 21

st

November, 1980, under Section 6 of the 2006 Act,

declaring the lands under the possession of the

Appellants to be vested in the Custodian of Evacuee

Property, stood vitiated, as the Appellants had

been denied an opportunity of explaining that they

were not mere occupants of the property in

question, but tenants thereof, in which case,

neither the provisions of Rule 9 nor Rule 13-C of

the 2008 Rules would have any application to the

facts of this case.

35. Apart from the above, the Settlement which was

entered into between the writ petitioners and the

State, was dependent on several factors, including

the fact that the occupants of the lands in

question had surrendered 22 kanals of prime land

Page 32 32

out of 37 kanals and 5 marlas in favour of the

Custodian Department while remaining in possession

of 15 kanals and 5 marlas, which were to be settled

with them. While, on the one hand, the State

authorities took advantage of the Settlement and

constructions were raised on the surrendered lands,

a stand was later taken on behalf of the State

Government that the Settlement stood vitiated on

account of non-compliance with the provisions of

Rule 13-C of the 2008 Rules. The fact situation of

this case is different from the circumstances

contemplated under Rule 13-C of the 2008 Rules. In

the present case, the lands covered by the

Settlement were not vacant and were not, therefore,

within the ambit of Rule 13-C when the Settlement

was at the gestation stage. It is only under the

Settlement that the claims and rights, if any, of

the writ petitioners were required to be

surrendered and, therefore, the question of actual

Page 33 33

surrender of possession of 22 kanals of land out of

37 kanals and 5 marlas, was to follow, leaving a

balance of 15 kanals and 5 marlas to be allotted to

the occupancy rights and tenants-at-will in respect

thereof.

36.The special facts of the case set the present

Agreement/Settlement apart from the cases of grant

of lease of vacant lands in terms of Rule 13-C and

has, therefore, to be treated differently.

Firstly, as the lands were not vacant, the very

first criterion of Rule 13-C, was not satisfied and

the lease of the lands were to be granted as part

of the settlement packet, which included surrender

of 22 kanals of prime land. We are inclined to

agree with the views expressed by Mansoor Ahmad

Mir, J. that in the special facts of this case,

Rule 13-C of the 2008 Rules would have no

application to the Settlement arrived at between

the parties and the same were not, therefore,

Page 34 34

vitiated for not putting the lands to auction to

determine the premium to be paid for the leases to

be granted in respect thereof. As observed by His

Lordship, it was nobody's case that the Settlement

was the outcome of any fraud or was unlawful and

the same, having been signed and acted upon, was

binding on the parties and could not be withdrawn

unilaterally.

37.In our view, the Settlement arrived at between

the parties and filed before the High Court for

acceptance by way of CMP No.128 of 2006 is lawful

and within the scope of Sub-Rule (3) of Order 23 of

the Code of Civil Procedure. The decision holding

the Settlement to be contrary to the provisions of

Rule 13-C of the 2008 Rules, as held by H. Imtiyaz

Hussain, J. on 15th September, 2007, and affirmed

by the third learned Judge, Y.P. Nargotra, J. by

his judgment and order dated 25th March, 2008,

cannot be sustained and is set aside.

Page 35 35

Consequently, the view expressed by Mansoor Ahmad

Mir, J. is upheld. CMP No.525 of 2006 is,

accordingly, dismissed and CMP No.128 of 2006 is

allowed. The High Court shall proceed to pass

appropriate orders for acceptance of the out-of-

Court settlement and for adjustment of the rights

of the parties in terms thereof in the LPA as well

as in OWP No.480 of 2003 and OWP No.454 of 2005.

38.Since, in these appeals we have only been

called upon to consider as to whether the

Settlement arrived at between the parties stood

vitiated on account of non-compliance with the

provisions of Rule 13-C of the 2008 Rules, we have

not expressed any opinion with regard to the second

limb of the submissions advanced regarding the

constitutionality of Section 6 of the 2006 Act.

The said issue is, accordingly, left to the High

Court for decision. We make it clear that whatever

has been expressed in this judgment, shall not in

Page 36 36

any way prejudice and/or affect the outcome of the

decision of the High Court in the said matter.

39. The appeals are, accordingly, disposed of.

There will, however, be no order as to costs.

...................CJI.

(ALTAMAS KABIR)

..................... J.

(SURINDER SINGH NIJJAR)

..................... J.

(J. CHELAMESWAR)

New Delhi

Dated: January 03, 2013.