G.N.Prasad, J. - (1.)This appeal was originally heard by a Division Bench of this Court composed of Mr. Justice U. N. Sinha and Mr. Justice S. N. P. Singh, who differed in their opinion, in consequence of which it has been laid before me.
(2.)The appeal is directed against an order of the learned Subordinate Judge of Hazaribagh appointing a receiver of the properties which are the subject-matter of Title Suit No. 16 of 1961 instituted by the State of Bihar on the 9th of May 1961. The appellant, a public limited company, is the first defendant in the suit. Some of the relevant facts necessary for the decision of the present controversy are these: On the 24th December 1947, Raja Bahadur Kamakhya Narain Singh, the recorded proprietor of Ramgarh estate bearing Tauzi No. 28 of Hazaribagh Collectorate, granted a coal and all mineral lease in and over 312 villages to Rajasthari Mines Limited. Again on the 19th February 1948, the Raja Bahadur granted another coal lease in and over 7500 standard bighas and in 261 other villages with all mineral rights therein to another company, Jharkhand Mines and Industries Limited". The first lessee will hereafter be referred to as Rajasthan and the second lessee as Jharkhand. On the 27th December, 1949, Rajasthan created four sub-leases out of "its lease in favour of four different companies, and, similarly, on the following day, Jharkhand created six subleases out of its lease-hold interest in the 261 villages in favour of six other companies, one of them being in favour of Kuju Jarangdih Coal Company Limited. The next relevant date is the 14th August 1954. On that date, Jharkhand assigned its right, title and interest in its lease of 7500 standard bighas as also leasehold interest in the 261 other villages to one of its sub-lessees, Kuju Jarangdih Coal Company Limited.
(3.)The case set up by the plaintiff is that all these transactions are sham and farzi and were created by the Raja Bahadur with the avowed purpose of defeating or nullifying the scheme of abolition of Zamindari, in respect of which a resolution was adopted by the Bihar Legislative Assembly in August 1946. The Raja Bahadur happened to be a member of the said Assembly and he was fully aware of the Government policy regarding the abolition of Zamindari. He, therefore, floated a number of bogus companies and purported to transfer the coal mining and other mineral rights appertaining to his estate in their favour with a view to save them from the consequences of zamindari abolition legislations which were in the offing. But in fact they remained his property. The Bihar Land Reforms Act (Bihar Act 30 of 1950) received the assent of the President on the 11th September 1950 and came into force on the 25th September 1950. Soon thereafter, a notification under Section 3 of the Act was issued in regard to Ramgarh and Sirampur estates of the Raja Bahadur. But the validity of this Act was challenged by the Raja Bahadur and his stand was upheld by this Court in 1951. Thereafter, in June 1951, the Constitution was amended giving immunity to the Act from attack. On the 3rd November, 1951, fresh notifications under Section 3 of the Act were issued in respect of the estates and tenures of the Raja Bahadur. Eventually, the validity of the Act was upheld by the Supreme Court in 1952 (Vide State of Bihar v. Sir Kameshwar Singh, AIR 1952 SC 252).