Land In Himachal Pradesh Can’t Be Transferred to Non-Agriculturist Without State’s Permission: SC

Supreme Court Law Insider

Sanjeev Sirohi

Published on: 02 February 2023 at 00:12 IST

While ruling on a very significant legal subject with a host of far reaching legal and other consequences, the Apex Court in a remarkable, robust, rational and recent judgment titled Ajay Dabra vs Pyare Ram & Ors. in SLP (C) No. 15793 of 2019 which was delivered as recently as on January 31, 2023 in the exercise of its civil appellate jurisdiction minced just no words to hold unequivocally that land in Himachal Pradesh cannot be transferred to a non-agriculturist, and this is with a purpose.

It must be mentioned here that the Bench of Apex Court comprising of Hon’ble Mr Justice PS Narasimha and Hon’ble Mr Justice Sudhanshu Dhulia clearly stated that the purpose is to save the small agricultural holding of poor persons and also to check the rampant conversion of agricultural land for non-agricultural purposes.

So we thus see that there is an underlying logic in what the Apex Court has ruled and the same has to be complied with certainly in totality. The Apex Court very rightly did not find any scope for interference and due to this both the appeals stood dismissed.     

At the very outset, this extremely commendable, cogent, creditworthy and convincing judgment authored by Hon’ble Mr Justice Sudhanshu Dhulia for a Bench of the Apex Court comprising of himself and Hon’ble Mr Justice Pamidighantam Sri Narasimha sets the ball in motion by first and foremost putting forth in para 2 that, “Both these Appeals before this Court are by the plaintiff who had filed a suit for specific performance, which was dismissed and later his First Appeal before the High Court was dismissed on the grounds of delay,”.

We may state here that the Plaintiff/Appellant was not a party to the contract of which a specific performance was sought. The contract was executed between the defendant and a company called M/s Himalayan Ski Village Pvt. Ltd. which was for sale of an ‘agricultural land’ in Himachal Pradesh. There were two plots of land for which two different “agreements of sale” were executed, and hence two civil suits were filed.”

To put things in perspective, the Bench then envisages in para 3 that, “In both the above appeals, there is a common challenge against order dated 17.12.2018 passed by the Single Judge of the High Court of Himachal Pradesh in CMP (M) No.75 of 2018 & CMP (M) No.76 of 2018,”.

The impugned order dismisses the delay condonation applications filed under Section 5 of the Limitation Act, 1963, declining to condone a delay of 254 days, because the reasons assigned for the condonation were not sufficient reasons for condonation of the delay,”.

The Appellant herein had earlier filed two suits (bearing nos. 28/2012 & 29/2012), for specific performance which were dismissed by the District Judge, Kullu vide order dated 30.12.2016.”

Needless to say, the Bench then states in para 4 that, “According to the Appellant the delay ought to have been condoned and his appeal should have been heard on its merits.”

    It is worth noting that the Bench notes in para 9 that, “We do not have a case at hand where the appellant is not capable of purchasing the court fee. He did pay the court fee ultimately, though belatedly,”.

But then, under the facts and circumstances of the case, the reasons assigned for the delay in filing the appeal cannot be a valid reason for condonation of the delay, since the appellant could have filed the appeal deficient in court fee under the provisions of law, referred above,”.

Therefore, we find that the High Court was right in dismissing Section 5 application of the appellant as insufficient funds could not have been a sufficient ground for condonation of delay, under the facts and circumstance of the case. It would have been entirely a different matter had the appellant filed an appeal in terms of Section 149 CPC and thereafter removed the defects by paying deficit court fees. This has evidently not been done.”

Briefly stated, we need to note that the Bench states briefly in para 11 that, “This apart, even on merits, we do not find it a case which calls for our interference. The facts of the case are that one, M/s. Himalayan Ski Village Pvt. Ltd. had entered into an ‘Agreement for Sale’ with an agriculturist/landowner of Himachal Pradesh, for sale of his agricultural land,“.

“Now the admitted position in the State of Himachal Pradesh is that under Section 118 of the Himachal Pradesh Tenancy and Land Reforms Act, 1972 (for short ‘1972 Act’), only an agriculturist, which is defined under Section 2(2) of the 1972 Act, can purchase land in Himachal Pradesh, which would mean a landowner who personally cultivates his land in Himachal Pradesh,”.

“If a non-agriculturist has to purchase a land, it can only be done with the prior permission of the State Government under Section 118 of the Act. M/s. Himalayan Ski Village was a private company, which was admittedly not an ‘agriculturist’ and therefore was not capable under the law to purchase the land in Himachal Pradesh and therefore it was a condition of the agreement to sale that the defendant would secure the necessary approval from the government within a stipulated period of time,”.

“The admitted position is that this approval was not given to the defendant by the State Government and then the defendant assigned his right to the plaintiff who thereafter filed the suit for specific performance.”

It cannot be glossed over that the Bench hastens to add in para 14 stating that, “The Trial Court dismissed the suits of the plaintiff primarily on grounds that getting permission from the State Government was an essential condition, which had not been fulfilled by him as per Section 118 of the 1972 Act and under the facts and circumstances of the case, the assignment in terms of the Plaintiff was not proper and valid.”  

Quite significantly, the Bench as we see then clearly points out explicitly in para 16 that, “In the present case the assignment is not valid as there was no prior consent or approval of the seller before the assignment. In the absence of such a condition and in lieu of the fact that before assignment of its rights to the plaintiff/Appellant herein no permission of the seller was obtained, there was no question of granting a decree of Specific Performance in favour of the plaintiff. Consequently, this is not a case which calls for our interference.”

Most significantly, the Bench then minces just no words to hold in para 17 what constitutes the cornerstone of this notable judgment wherein it is held that, “We may here add that the whole purpose of Section 118 of the 1972 Act is to protect agriculturists with small holdings. Land in Himachal Pradesh cannot be transferred to a non-agriculturist, and this is with a purpose. The purpose is to save the small agricultural holding of poor persons and also to check the rampant conversion of agricultural land for non-agricultural purposes,”.

A person who is not an agriculturist can only purchase land in Himachal Pradesh with the permission of the State Government. The Government is expected to examine from a case to case basis whether such permission can be given or not. In the present case, it thought it best, not to grant such a permission,”.

However, the purpose of the transfer remains the same, which is a non-agricultural activity. By merely assigning rights to an agriculturist, who will be using the land for a purpose other than agriculture, would defeat the purpose of this Act. In the case of Ashok Madan and Another versus State of H.P. and Other9 the Himachal Pradesh High Court had laid down the following important observation with respect to Section 118 of the 1972 Act:

“12. The law is, therefore, clear that merely the nomenclature or the title of the document sill not determine what are the rights created by the document. The intention of the parties must be gathered on a combined reading of all the documents and the behaviour of the parties in the manner in which they treated the document,”.

Section 118 was introduced with a view to restrict the transfer of land in favour of non-agriculturist except to specified persons as contained in the Section itself. The purpose behind it was that the economically advantageous class does not take undue advantage of the small agriculturists by purchasing their small holdings,”.

The provision was introduced as rich persons who were not agriculturists were purchasing agricultural land in Himachal Pradesh at high price exploiting the local Himachali people. However, the section itself provided that in special cases permission can be granted for transfer of land to non-agriculturist. The constitutional validity of this Section was upheld in Smt. Sudarshana Devi v. Union of India, ILR 1978 HP 355.””

Finally, the Bench then concludes aptly by holding in para 19 of this learned judgment that, “Under the facts and circumstances of the case we do not find any scope for interference in the matter. Consequently, both the appeals stand dismissed.”   

In conclusion, we thus see that the Apex Court has made it indubitably clear in this latest, laudable, logical, landmark and learned judgment that a land in Himachal Pradesh cannot be transferred easily to a non-agriculturist without the permission of the State Government.

Of course, it thus merits no reiteration that the logic underlying this refreshing judgment is to save the small agricultural holding of poor persons and also to check the rampant conversion of agricultural land for non-agricultural purposes. Very rightly so!  

Sanjeev Sirohi, Advocate

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