GODAVARI SUGAR MILLS LTD Vs. S RAMAMURTHY
LAWS(BOM)-1972-2-2
HIGH COURT OF BOMBAY
Decided on February 16,1972

GODAVARI SUGAR MILLS LTD. Appellant
VERSUS
S.RAMAMURTHY Respondents

JUDGEMENT

- (1.) IN this Petition under Articles 226 and 227 of the Constitution the six Petitioners have challenged the legality and correctness of the decision of the Maharashtra Revenue Tribunal dated March 19, 1969, whereby the Tribunal confirmed the order of the Collector of Ahmednagar dated August 31, 1965, in the matter of Inquiry No. Ceiling Rahuri 42 of 1964, whereby the Collector made a declaration that the partnership firm of the six Petitioners, viz. , M/s Somalia Farm, Lakh, was entitled to retain land to the extent of one ceiling area i. e. 108 acres of dry-crop land and the total area of land which was in excess of the ceiling area was 812 acres and 32 3/4 gunthas equivalent to dry-crop area 1321 acres and 12 gunthas.
(2.) THE facts which require to be noticed are as follows : -Prior to October 1, 1949, one K. J. Somalia was the owner of three big agricultural farms, one of them being Somalia Farm, situated at Lakh in Rahuri Taluka. This last farm was sold on October 1, 1949, to the first Petitioner Company (hereinafter referred to as "the Company" ). The holding of the Company, so far as this petition goes, may be considered as 869 acres and 02 gunthas. This very holding was the subject-matter of an agreement of partnership executed by the six Petitioners including the Company on November 30, 1959. The substance of the agreement of partnership was that as from June 1, 1956, the six petitioners should carry on the business of working and running of an agricultural farm on the above lands of Somalia Farm (at Lakh) and of cultivating sugar-cane and other crops. The partnership was terminable at will. Though the Company took the remaining five Petitioners as partners, the good-will of the firm name and the benefit of the agricultural tenancy rights and all other rights in respect of the lands were agreed to continuously belong to the Company. The capital for the business was also to be brought in only by the Company. The Petitioners Nos. 2 to 6 were only taken as working partners with a right to remuneration of Rs. 175/- p. m. plus shares in profits and losses of partnership as given to them under clause 98) of the agreement. The company kept 25 per cent whilst the petitioner No. 2 was given 18. 75 per cent and the rest of the petitioners were given 14. 0625 per cent of the profits and losses in the partnership business. In pursuance of its liability to do so under the Maharashtra Agricultural Lands (Ceiling on Holdings) Act, 1961, the partnership firm filed a return in respect of the above lands. By the return the partnership claimed that the farm lands were being cultivated by the partnership as from June 1, 1959, and that under the Act each of the six partners was entitled to retain lands to the extent of one ceiling area viz. , 108 acres dry-crop land. In the alternative, it was claimed that in any case the partnership firm as holders was entitled to retain with itself 108 acres of dry-crop land. By his order dated August 31, 1965, the Collector of Ahmednagar rejected the contention of the partnership that each of the partners was a separate holder entitled to retain one ceiling area i. e. , 108 acres of dry-crop land. He, accordingly, made a declaration that the partnership (s one entity) was entitled to continue to hold one ceiling area i. e. , 108 acres of dry-crop land and made consequential declaration regarding the surplus area and other relevant matters. Before the Maharashtra Revenue Tribunal, diverse contentions were advanced so that a finding could be made in favour of the six Petitioners that each of them was entitled to hold on ceiling area i. e. , 108 acres of dry-crop land. The Tribunal rejected these contentions and confirmed the order of the Collector. In arriving at this finding, the Tribunal referred to the provisions in the deed of partnership produced by the Petitioners. The Tribunal noticed that the lands were cultivated in partnership and were entered in the name of Somalia Farm in the land records. It observed that in accordance with the entries in the record of rights and the tenancy register it could be said that the firm of Somalia Farm was in actual possession of the land. It referred to the provisions in Section 2 (14) of the Ceiling Act defining the phrase "to hold land" and observed that the possession was not with the individual partners and was with the Somalia Farm. The Tribunal observed :- ". . . . . . . . . . . . . . . . even assuming that the several partners of the Somalia Farms are in joint possession of lands which form the subject-matter of this appeal, each of them would not be a holder within the meaning of sub-section (14) of Section 2 of the Ceiling Act, since their possession is nether as tenants nor as owners except in respect of Godavari Sugar Mills Ltd. " The further observation was : ". . . . . . . . . . . . . . . the farm is cultivated and managed by the partnership Firm. That would not confer on partners the character of holders. At the most it can be said that Somalia Farm is managed by the firm and if the tenancy rights vest in Somalia Farm then Somalia Farm would be a holder. But it is difficult to understand how the partners can be holders within the meaning of Section 2 (14) of the Ceiling Act when they do not claim any interest in the tenancy rights and are only partners in cultivation and management. " They rejected the contention on the basis of the term "person" contained in Section 2 (22) of the Ceiling Act. The further observation was :- ". . . . . . . . . . . . . . . . . . . . . . There is no indication in the record to show that all these six partners are holders directly paying rent to the landlord. They are only partners in cultivation. A careful perusal of the record has confirmed us in this view. " Having made the above finding the last observation that the Tribunal made was : - ". . . . . . . . . . It is only the Godavari Sugar Mills who are the holders and other persons who style themselves as partners of Somalia Farm are merely partners in cultivation. "
(3.) IN support of the reliefs claimed in this petition Mr. Nariman for the petitioners has made the following contentions : having regard to the definitions of the phrases "to hold" and "the tenant" in Sections 2 (14) and 2 (30) of the Ceiling Act and the provisions in sections 4 and 2 (6) of the Bombay Tenancy and Agricultural Lands Act, 1948, every person who lawfully cultivated lands belonging to other persons whether or not their authority was derived directly from the owner of the land must be "deemed tenant" of the land. Each of the petitioners who admittedly lawfully cultivated the lands in question must accordingly be held to be "deemed tenant" of the land. The partnership firm of the six petitioners was not a "persons". In the result the Tribunal should have held in favour of each of the petitioners that each of them was entitled to retain with himself 108 acres of land as the prescribed ceiling area. In developing his arguments Mr. Nariman referred us to the decision of the Supreme Court in Dahya Lala v. Rasul 65 Bom LR 328 = (AIR 1964 SC 1820 ).;


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