(1.) In order to appreciate the point of law that arises for decision in Letters Patent Appeal No. 14 of 1952 it is necessary to set out the facts of the case in some detail.
Shri Bansi Lal, Income-tax Officer, forwarded to the Collector, a certificate, Exhibit P. Y., under Section 46(2) of the Income-tax Act, 1922, specifying that Rs. 1,75,627-10-0 were due from Messrs. Rur Chand Kishori Lal, assessee, on account of arrears of income-tax, supper-tax and penalty. In forwarding the certificate, Exhibit P. Y., Shri Bansi Lal sent letter, Exhibit P. X., to the Collector, Jullundur, stating that the amount specified in the certificate should be recovered from the movable and immovable property of Rur Chand. In that letter the Income-tax Officer maintained that, Rur Chand. In that letter the Income-tax Officer maintained that, Rur Chand being the sole proprietor of Messrs. Ralla Ram Raj Kumar, the movable and immovable property of Messrs. Ralla Ram Raj Kumar was liable to attachment and sale for the recovery of the amounts specified in certificate.
Pursuant to the requisition made by the Income-tax Officer under Section 46(2) of the Income-tax Act the Collector attached properties mentioned in lists A and B appearing at pages 9 and 11 of the record of the suit out of which these proceedings have arisen.
Messrs. Ralla Ram Raj Kumar served notice, Exhibit D. 1, on the Government of India under Section 80 of the Code of Civil Procedure. In that notice Messrs. Ralla Ram Raj Kumar maintained that the properties attached were not the properties of the assessee-firm or Rur Chand. Messrs. Ralla Ram Raj Kumar objected to the attachment, but the Tahsildar, Jullundur, rejected the objection on the 14th of September, 1948.
From the order rejecting the objections Messrs. Ralla Ram Raj Kumar went up in appeal before the Collector. That appeal was dismissed on the 31st of March, 1949.
On the 6th of November, 1948, Messrs. Ralla Ram Raj Kumar instituted the suits out of which these proceedings have arisen for declaration that the properties attached were the properties of the plaintiff-firm and were not liable to attachment and sale for the recovery of income-tax, super-tax and penalty due from Messrs. Rur Chand Kishori Lal. In that suit injunction was claimed restraining the Government from auctioning the attached properties.
(2.) On the 18th of February, 1949, the Court of first instance fixed the following issue on the pleadings of the parties :
"Whether the property in dispute belongs to the plaintiff firm -
Rur Chand having been adjudicated insolvent, the Official Receiver, Jullundur, was impleaded to be the defendant.
In decreeing the suit with costs the Court of first instance found that the attached properties belonged to the plaintiff-firm of which Daulat Ram and not Rur Chand was the proprietor.
From the decree passed in that suit the Union of India appealed under Section 96 of the Code of Civil Procedure.
In the Court of the District Judge, the Union of Indian objected that the suit was barred by Section 158(2) (xiv) of the Punjab Land Revenue Act, hereinafter referred to as the Act. That objection failed and was disallowed. On merits the District Judge found that Daulat Ram was owner of one-half of the properties attached and that that one-half share was not liable to attachment and sale for the recovery of income-tax, super-tax and penalty due from Messrs. Rur Chand Kishori Lal. I deciding the appeals the Court left the parties to bear their own costs throughout.
Messrs. Ralla Ram Raj Kumar appealed from the decree passed by the District Judge in Civil Appeal No. 243 of 1950.
In Regular Second Appeal No. 497 of 1951 it was said that the suit out of which the appeal arose was barred by Section 158 (2) (xiv) of the Act and that Rur Chand was not the owner of one-half of the properties attached.
In overruling the objection as to the competency of the suit Soni, J., said :-
"If ex facie the property which is being proceeded against belongs to the defaulter then the proceedings of the Collector could not be challenged, but where in the very beginning or inception or ex facie it is somebody elses property which is being proceed against then there is no principle of law which would bar the jurisdiction of the Courts".
In allowing regular Second Appeal No. 497 of 1951 Soni, J., set aside the order and decree passed by the District Judge and restored the decree passed by the Court of the first instance with costs throughout.
From the judgment given in Regular Second Appeal No. 497 of 1951 the Union of Indian appeals under clause 10 of the Letters Patent.
In arguments it was conceded that the decision on facts given by the Court of first appeal was not open to challenge.
From what I have said above, it is plain that the point that arises for decision is whether the suit out of which these proceedings have arisen was barred by Section 158 (2) (xiv) of the Act.
Section 158 (2) (xiv) of the Act reads :-
"158. Except as otherwise provided by this Act -
(1) * * * * (2) a Civil Court shall not exercise jurisdiction over any of the following matters, namely -
(xiv) any claim connected with, or arising out of the collection by the Government, or the enforcement by the Government of any process for the recovery of land revenue or any sum recoverable as an arrear of land revenue;..."
From a perusal of Section 158 (2) (xiv) of the Act it is plain that Section 158 (2) (xiv) was intended to oust the jurisdiction of civil Courts with respect to matters dealt with in Chapters VI and VII of the Act dealing with the collection of land revenue or the enforcement of any process for the recovery of land revenue.
In Sections 61 to 78 provision is made for the collection of land revenue. Section 79 to 96 of the Act provide procedure to be followed in sales while Sections 97 and 98 prescribed procedure for the recovery of demands other than land revenue by Revenue Officers.
Section 67 of the Act defines processes for the recovery of arrears of land revenue. That section reads :-
"67. Subject to the other provisions of this Act, an arrear of land revenue may be recovered by any one or more of the following processes namely :-
(a) by service of a writ of demand on the defaulter;
(b) by arrest and detention of his person;
(c) by distress and sale of his movable property and uncut or ungathered crops;
(d) by transfer of the holding in respect of which the arrear is due;
(e) by attachment of the estate or holding in respect of which the arrear is due;
(f) by annulment of the assessment of that estate or holding;
(g) by sale of that estate or holding;
(h) by proceedings against other immovable property of defaulter".
Plainly, no person other than the defaulter is to be affected by any process issued under the Act for the recovery of arrears of land revenue. In recovering arrears of land revenue processes for the recovery of those arrears are to issue against the person or property of the defaulter. Indeed, Section 77 of the Act provides inter alia that no interests save those of the defaulter shall be proceeded against, and no incumbrances created, grants made or contracts entered into by him in good faith shall be rendered invalid by reason only of his interest being proceeded against. In my judgment, the claims referred to in Section 158(2) (xiv) of the Act are claims which are connected with or arise out of proceedings for the enforcement of any process for the recovery of land revenue or any sum recoverable as an arrear of land revenue.
Section 78 of the Act provides for payment under protest made in writing at the time of payment and gives the defaulter a right to institute suit in civil Court for the recovery of money so paid.
Section 84 of the Act provides that on payment by the defaulter the arrears in respect of which the property has been proclaimed for sale the sale shall be stayed.
Section 91 of the Act provides for an application to set aside the sale on the ground of some material irregularity or mistake in publishing or conducting the sale.
Section 92 of the Act provides for the confirmation of sale in certain cases and for the setting aside of the sale in certain other cases.
(3.) Section 158(2) (xv) of the Act provides that an action to set aside a sale for the recovery of arrears of land revenue or any sum recoverable as an arrear of land revenue on the ground of fraud would be competent in a civil Court.
From an examination of the Act it is plain that no provision has been made therein which may give relief to a person other than the defaulter in case the property of that person is proceeded against for the recovery of arrears of land revenue. That being the position of matters, the conclusion is almost irresistible that it was not the intention of the legislature that the prohibition contained in Section 158(2) (xiv) of the Act should apply to the claims of persons other than the defaulter.;