- (1.) This .appeal by special leave arises from a suit instituted by the appellant, the Municipal Committee, Damoh, against the two respondents, the State of Madhya Pradesh, and the Agricultural Association Ltd., Damoh respectively. The property in dispute is a grain market known as the Mawganj, Grain Market in Damoh. The lands on which the said market has been built, were acquired by the appellant some time in about 1902 and they continued in possession of the appellant thereafter. Later, the present grain market was built upon the lands and the same was being managed by the appellant in accordance with the bye-laws sanctioned by respondent No. 1 as per its Notification No. 8006/2136-M-VII, dated the 13th December, 1930. The profits accruing from this market were received by the appellant. On the 8th June. 1956, respondent No. 1 issued a Notification No. 2760-2394-X under section 3 of the Central Provinces and Berar Agricultural Produce Market Act, 1935 (No. 29 of 1935) (hereinafter called 'the Act'). THIS notification declared that the boundaries of the market known as Mawganj Agricultural Market at Damoh would be a market for the sale and purchase of agricultural produce. The same day another Notification No. 2758-2394-X was issued by respondent No. 1 by which the management of the said market was vested in respondent No. 2, under section 16-A (3) of the Act. On the 1st July, 1956, a peremptory order was issued by the Sub-Divisional Officer, Damoh, requiring the appellant to deliver possession of the market to respondent No. 2. As a result of this coercive order, the appellant gave possession of the market in suit to respondent No. 2 on 1st July 1956. In the present suit, the appellant's contention is that respondent No. 1 was not justified in compelling the appellant to deliver possession of the market by virtue of the order issued by the Sub- Divisional Officer, and that the two notifications issued on 8th June 1956 in pursuance of which the said order was purported to have been issued, were invalid. That is how the appellant asked for a decree for possesion of the property in suit and its management. It also claimed that the two respondents may be directed to render account of the mesne profits recovered by them from 1st July 1956 until the date of the decree. THIS suit was filed on the 1st April, 1957 in the Court of II Civil Judge, Damoh.
(2.) In its plaint, the appellant referred to the fact that before the impugned notifications were issued, the appellant had been consulted by respondent No. 1 and it had passed a resolution on the 1st December, 1955, giving approval to the subject of respondent No. l's proposal for regulating the Grain Market. The appellant alleged that this resolution was very vague and had been passed without giving due thought to the question posed by the Government's proposal. Besides, the appellant contended that even if the said resolution is said to be binding on the appellant, the title of the appellant in respect of the property in suit cannot be divested by the two impugned notifications, with the result that the appellant continued to be the owner of the said property and as such, was entitled to claim its possession and mesne profits during the period that it had been divested of it. This claim was resisted by both the respondents. It was urged on their behalf that the management of the market had been taken over by respondent No. 2 in accordance with the two impugned notifications and the appellant had consented to the said transfer. The respondents, therefore, contended that the appellant was not entitled either to the possession of the property in suit or to any mesne profits or to rendition of accounts. On these pleadings, the learned trial Judge framed several issues. He found that the suit lands had been acquired by the appellant with its own funds in 1902, and that the appellant was the sole and absolute owner of the said property. The learned trial Judge also held that the appellant was entitled to enjoy the profits from the said property. He then considered the question as to whether the notification issued by respondent No. 1 prior to the acquisition of the property from the appellant should have been consulted before the two impugned notifications were issued; and he answered the question in the negative. The plea of the appellant that it had been coerced to deliver possession of the property to respondent No. 2, was also rejected by him. The learned trial Judge, however, came to the conclusion that the property could not be transferred to respondent No. 2 without compensation being paid to the appellant. This, he thought, was the result of the relevant provisions of section 38 of the Act, particularly section 38 (3). The learned Judge took the view that the transfer in question was not a transfer merely of management, but it was a transfer of the peoperty itself. He was not impressed by the respondents' plea that the resolution passed by the appellant on 1st December 1955 validated the said transfer. That being so, he did not uphold the respondents' plea of estoppel against the appellant. In the result, he decreed the appellant's suit and directed the respondents to deliver possession of the market and its management to the appellant and to render account of the mesne profits from 1st July 1956 until the date of delivery of possession. This decree was pronounced on the 9th October, 1958. The respondents challenged the said decree by preferring two appeals respectively in the Court of the Additional District Judge, Damoh. The lower appellate Court, however, agreed with the findings recorded by the learned trial Judge on all the issues, and rejected the contention raised by the respondents that the decree passed by the trial Judge should be reversed. That is how the appeals preferred by the respondents were dismissed on the 23rd February, 1959. That took respondent No. 1 to the High Court of Madhya Pradesh at Jabalpur in second appeal. The second appeal was first heard by a learned single Judge of the said High Court who substantially agreed with the view taken by the Courts below in regard to the title of the appellant. He, however, thought that the appellant could not claim mesne profits since it had consented to the establishment of an agricultural market before respondent No. 1 issued the two impugned notifications. In his opinion, all that the appellant could claim would be damages for use and occupation of the property in suit. As a result of this finding, the learned Judge also negatived the appellant's claim for possession; but he decided to remand the case to the trial Court to determine the amount of damages to which the appellant would be entitled for use and occupation of the property in suit by respondent No. 2. This judgment was pronounced on the 23rd October, 1961. A similar ordei was passed in respondent No. 2's appeal.
(3.) This decision gave rise to two cross Letters Patent appeals, one by the appellant and the other by respondent No. 1. The Division Bench of the High Court which heard these two appeals allowed the appeal preferred by respondent No. 1 and dismissed the appeal preferred by the appellant. In the result, the suit instituted by the appellant has been wholly dismissed. THIS decision was pronounced on the 14th November, 1962. It is against this decision that the appellant has come to this Court by special leave. Mr. Agarwal for the appellant contends that the view taken by the Division Bench is plainly erroneous in law. It is clear that both the learned single Judge and the Division Bench have agreed in holding that the title to the property which vested in the appellant before the issue of the two impugned notifications is not divested. In other words, the dispute between the parties has now to be considered on the basis that the appellant was and continued to be the owner of the market in suit. The Division Bench, while agreeing that the said notifications did not affect the title of the appellant, was inclined to take the view that as a result of the consent given by the appellant to declaration of the market, the appellant was not entitled to claim any relief in respect of the property in suit. The Division Beneh accepted the appellant's contention that the impugned notification would be invalid if they purported to affect the title of the appellant to the suit property, but it observed that "the question of the validity of the notifications cannot be confused with their practical effectiveness". We are unable to appreciate what this observation precisely means. If the impugned notifications do not affect the title of the appellant, then they cannot deprive the appellant of the right to claim rent or compensation from the respondents for use and occupation of its own property by respondent No. 2. This position appears to us to be plain and unambiguous. Let us refer to the relevant provisions of the Act to show how they do not in any manner affect the validity of this position. Section 3 of the Act reads thus:- "(1) The State Government may, after consulting if necessary, the local authorities concerned in such manner as it thinks fit, or upon a representation made by such authorities or by growers of agricultural produce within the area affected, by notification, declare that any place or market is a market for the sale and purchace of agricultural produce. (2) Every notification under sub- setion (1) shall define the limits of a market and may, for the purposes of this Act, include within such limits such local area as the State Government may prescribe'. It is true that the declaration by the State Government that any place or market is a market for the sale and purchase of agricultural produce, could have, and has been, validly issued by respondent No. 1 under section 3 (1) of the Act. This section, no doubt provides for consultation with the local authorities; but the provision is not of such a mandatory character that it should render the notification invalid if the local authorities had not been consulted, or on consultation, refused to consent. That being so, the question as to whether the resolution passed by the appellant on 1st December, 1955 was with the full knowledge of the relevant facts, makes no difference. The appellant has in fact consented; and we will deal with the present dispute on the basis that the requirement of consultation prescribed by section 3 (1) of the Act has been satisfied. But that only means that the declaration of the market was validly made, it has no relevance or materiality on the question as to the appellant's title to the property in suit.;