LAKHRAJ SATHRAMDAS LALVANI Vs. MATHUR

JUDGEMENT

(1.) The business and assets of two firms; "Adam Hajee Peer Mohammed Essack" and "Hajee Ebrahim Kassam Cochinwala" in Kozhikode, which may be referred to hereafter as the "firms", were evacuee property, which became vested in the Custodian of Evacuee property for the State of Madras, under S.8 of the Administration of Evacuee Property Act, 1950, which may be referred to hereafter as the 1950 Act, when the former proprietors of the firms migrated to Pakistan, in or about the year 1947. On the application of the petitioner, a refugee from Pakistan, who, it is said, had registered his claim as a displaced person under the Displaced Persons (Claims) Act, 1950 the firms were entrusted to him for management on March 21, 1952. Subsequently, it was proposed, or, to adopt the language of a communication from the Government of India "decided in principle", to allot, meaning perhaps to convey absolutely the business of the firms to the petitioner, on terms and conditions which were to be settled ; but at the hearing it was common ground, that in spite of prolonged negotiations concerning them, commencing with Exts. P. 2 and P. 3 in October, 1953, and ending with Ext. P. 27 in September 1956, there never was at any time, consensus ad idem or a concluded contract or binding agreement between the parties, though the area of disagreement had narrowed a good deal.

(2.) In the year 1954, the Displaced Persons (Compensation and Rehabilitation) Act, 1954 which may be referred to hereafter as the 1954 Act, was passed. S.12 of which, empowered the Central Government to "acquire" any evacuee property "for a purpose connected with the relief and rehabilitation of displaced persons", and provided, that on the publication of the prescribed notification, the right, title, and interest of any evacuee in the property specified in it, shall be extinguished, and the property shall vest absolutely in the Central Government. A notification, Ext. P. 21, was made under S.12 of the 1954 Act in respect of "all urban immovable properties in the State of Madras" which had been declared to be evacuee property under the 1950 Act. The respondents have a contention in their counter affidavit, that the business of the firms, including the stock in trade and the goodwill, was also covered by the notification but the learned Advocate General could sustain it, only if and to the extent to which, the tenancy rights of the evacuee in respect of the business premises may be deemed to be affected by the notification. It is seen, however, from the communications which had passed,especially from Ext. P. 6 which finally embodied the terms and conditions of the proposed allotment, that the tenancy rights were never proposed to be conveyed to the petitioner; nor, are these rights claimed by him in this petition, and so no question arises with respect to them. It may therefore be taken, that the firms were not acquired under the 1954 Act.

(3.) To resume the narrative, after the 1954 Act came into force, evacuee property, including the firms, were advertised for sale by auction, when the petitioner applied to the Chief Settlement Commissioner, New Delhi, an Authority created by that Act, and to the Government of India, to stop the sale of the firms and to allot them to him. The Government of India, replied by Ext. P. 5 dated April 25, 1956, that "it has been decided in principle that the aforesaid evacuee concerns will be allotted" to the petitioner, that "the terms of allotment will be communicated........... separately" and that meanwhile, the petitioner "will continue to function as the Custodian's manager for the concerns in terms of S.10(2Xb)" of the 1950 Act; the sale by auction was stayed. This was confirmed also by the Custodian's letter dated June 3, 1956, to the Deputy Custodian, a copy of which was forwarded to the petitioner under covering letter Ext. P. 8. It was in pursuance of the above, that letter Ext. P. 6, referred to earlier, dated September 6, 1956 was addressed by the Assistant Custodian to the petitioner, formulating the terms and conditions upon which the allotment was to be made, and enquiring whether they were acceptable to him; as stated, some of the conditions were not accepted. In the meantime, the Chief Settlement Commissioner cum Deputy Custodian General intimated the Regional Settlement Commissioner cum Custodian of Evacuee Property, Bombay, by letter Ext. R. 4 dated March 18, 1958, that it has been decided to sell the firms in auction, on April 10, 1958. The petitioner thereupon moved this Court under Article 226 of the Constitution by O. P. No. 204 of 1958 for a writ of prohibition restraining the sale. In the meanwhile, the Deputy Chief Settlement Commissioner directed the Regional Settlement Commissioner by Ext. R. 5 dated August 16, 1958, that the services of the petitioner as manager of the firms may be terminated, immediately, and that complete charge may be taken over from him, deputing a Special Officer to proceed to Kozhikode. O. P. Mo. 204 of 1958 was disposed of on June 25, 1959, this court holding, that the sale by auction or otherwise could not go on, without the general or special order of the Chief Settlement Commissioner under Rule 101 of the Displaced Persons (Compensation and Rehabilitation) Rules, 1955, but leaving undecided, the other points raised by the petitioner. It may be mentioned, that such order was passed by the Chief Settlement Commissioner under Ext. R. 1. Apparently, in pursuance of the direction in Ext. R5, the tour programme of an officer, whose designation was set out in Ext. P. 11, as Deputy Custodian of Evacuee Property, Southern States, was forwarded to the petitioner by the District Collector, Kozhikode; the first respondent arrived in Kozhikode, according to schedule, and after preparing the inventories, on December 18, by Ext. P. 13, served on the petitioner, terminated his management of the firms and by Ext. P. 16, proceedings, took over possession, the petitioner entering his protest.