Union Of India Through The Deputy Salt … vs The Estate Investment Company Pvt.Ltd. … on 30 April, 2026

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    Bombay High Court

    Union Of India Through The Deputy Salt … vs The Estate Investment Company Pvt.Ltd. … on 30 April, 2026

    2026:BHC-AS:20811-DB
    
    
    
    
                       IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                               CIVIL APPELLATE JURISDICTION
    
                                FIRST APPEAL NO.1430 OF 2019
                   Union of India,                            ]
                   Through the Deputy Salt Commissioner,      ] ..Appellant/
                   Ballard Estate, Mumbai - 400001.           ] Org. Plaintiff
                                  Versus
                   1. The Estate Investment Company Pvt. Ltd. ]
                      Sakseria Chambers, Fort, Mumbai-1.      ]
                   2. M/s Mira Salt Work Company,             ]
                      Lalji Mansion, Lohar Chawl,             ]
                      Mumbai-400001.                          ]
                   3. The State of Maharashtra                ]
                   4. The Collector of Thane                  ]
                   5. The Additional Commissioner,            ]..Respondents
                      Konkan Division, Mumbai                 ]Org.Defendants
    
                   Mr. Anil C. Singh, Additional Solicitor General with
                   Mr. Aditya Thakkar, Ms. Savita Ganoo, Mr. Ameya
                   Mahadik, Mr. Siddha Pamecha, Ms. Simantini Mohite,
                   Mr. Ashish Mehta, Mr. Adarsh Vyass, Mr. Rama Gupta,
                   Mr. Rajdutt Nagre and Mr. Krishnakant Deshmukh,
                   Advocates for the Appellant-Original Plaintiff.
                   Mr. Girish Godbole, Senior Advocate, with Mr. Saurabh
                   Kirpal, Senior Advocate, Mr. Jaydeep Oza and Mr. Mustafa
                   Nulwala, i/by Ms. Tabbassum Achhan, Advocates for
                   Respondent No.1.
                   Mr. Aspi Chinoy, Senior Advocate, with Mr. Yohaan Shah,
                   Ms.Rujuta Patil, Mr. Hasan Mushabber and Adv. Divishada
                   Desai, Advocates, i/by Negandhi Shah & Hidayatullah, for
                   Respondent No.2.
                   Mr. A.R. Patil, Additional Government                       Pleader        for
                   Respondent Nos.3 to 5-State of Maharashtra.
    
                                     CORAM : SHREE CHANDRASHEKHAR, CJ &
                                             GAUTAM A. ANKHAD, J.
                         Judgment is reserved on                : 13th February 2026.
                         Judgment is pronounced on : 30th April 2026.
    
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     PER, GAUTAM A. ANKHAD, J.
    
               This First Appeal assails the judgment dated 13 th April
    2018 passed by the learned 7th Joint Civil Judge, Senior
    Division, Thane, whereby Special Civil Suit no.771 of 2011
    filed by the appellant seeking declaration of its title over a
    piece of land comprised under Mira, Manek/Shapur Salt
    Works, at village Bhayander, district Thane has been
    dismissed ("impugned judgment").
    
    2.         The appellant filed the suit seeking the following
    reliefs:
    
         "(A) It be declared by this Hon'ble Court that the plaintiffs are
              owners of the suit lands bearing Survey Nos. schedule A
              covered by Mira, Manek/Shapur Salt Works, village
              Bhayander, District Thane and that the defendants have no
              right, title or interest in the same;
         (A)(1) The plaintiffs be granted leave U/s. 80(2) of CPC to file this
                suit before expiry of statutory period of two months after
                service of the same upon defendant nos.3 to 5;
         (B)    The orders passed by the Collector dated 18 th November
                2002 in Application No.4 of 1999 filed by the defendant no.2
                under section 20 MLRC, 1966 dated 8 th October 2010
                passed by defendant no.5 in Appeal Nos.38 and 97 of 2003
                and Appeal No.133 of 2008 as also the order passed by the
                Collector dated 5th September 2008 under the provisions of
                Salsette Estates Abolition of Land Revenue Exemption Act,
                1951 be set aside;
         (C)    The defendant nos.1 and 2 be directed to decreed and order
                to hand over vacant and peaceful possession of the suit
                land bearing survey nos. as per schedule A covered by Mira,
                Manek/Shapur Salt Works, village Bhayander, District
                Thane;
         (D)    The defendants by themselves, their agents and servants be
                restrained by a permanent order of injunction of this Hon'ble
                Court from transferring, alienating or creating any third-
                party interest in the suit land and from using the same for
                any purposes other than salt manufacture and for doing any
                construction work on the same and from developing it;
         (E)    For interim and ad-interim relief in terms of prayer clause/s
                above;
    
    
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              (F)    The defendants be decreed, directed and ordered to pay
                    sum of Rs.2,078=00 towards damages as mentioned in the
                    particulars of the plaint;
             (G)    This Hon'ble Court be pleased to direct enquiry into mesne
                    profit earned by the defendants as per the provisions of
                    Order 20 Rule 11 of C.P.C.;
             (H)    For costs of this suit;
             (I)    For such other and further reliefs, as this Hon'ble Court
                    deems fit and proper be granted."
    
    
       3.          On 21st July 2012, respondent nos.1 and 2 filed their
       written statements opposing the suit on several grounds.
       Respondent nos.3 to 5 did not file any written statement.
       The following issues were framed by the trial Court on 25 th
       June 2013 and answered as under:
    Sr.No.                                         Issues                                  Findings
    
               Whether plaintiff proves that it is the owner of the suit
      1.                                                                                       No
               property?
    
      2.       Whether the suit is maintainable?                                               No
    
               Whether this Court has jurisdiction to try and entertain the
      3.                                                                                       No
               suit?
    
      4.       Whether the suit is within limitation?                                         Yes
    
      5.       Whether the suit is barred by principle of res-judicata?                        No
    
      6.       Is the plaintiff entitled to possession of suit property?                       No
    
      7        Is the plaintiff entitled to relief claimed as prayed for?                      No
    
      8        What order?                                                                     No
    
    
    
       4.          The    appellant          led     evidence   of     Mr.     Harikrishna
       Agarwal, the then Assistant Salt Commissioner (PW-1), in
       an endeavour to prove its case on title to the suit lands.
       Respondent nos.1 and 2 also led documentary and oral
       evidence of one witness each. Respondent nos.3 to 5 did
    
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     not lead any evidence nor cross-examined any of the
    witnesses who had tendered evidence in the matter, on
    behalf of the other parties. After considering the evidence
    on record, the trial Court dismissed the suit inter alia
    holding as follows:
       "17. It is admitted position that prior to this suit many legal
            proceeding were initiated in respect of the suit property.
            Those are;
               1)     Appeal No.133/08 filed by defendant no.1 challenging
                      the order dtd 07/08/1992 passed by SDO directing to
                      delete the name of defendant no.1 from the other rights
                      column in the Mutation Entry No.4996 dtd.
                      28/01/1989.
               2)     Appeal No.14/1983 in which the Additional Collector
                      directing to enter the name of plaintiff as holder of the
                      suit property and to enter the name of defendant no.1
                      in the other rights column.
               3)     Appeal No.9/1993 before the Collector for deleting the
                      name of defendant no.1 from the record of rights.
               4)     Writ Petition No.2861/1983 filed by defendant no.2
                      challenging the notice dtd. 16/07/1983.
               5)     W.P. No.2333/1983 directing the plaintiffs to renew
                      the license without insisting upon requirement to
                      execute lease.
               6)     Special Leave Petition No.14528 of 1998 / Civil Appeal
                      No.3055/1999 challenging the order passed in Civil
                      Appeal No.6743/1996 filed by the plaintiff against the
                      Gajanan Laxman Desai.
    
               7)     RTS Application No.4/1999 before the District
                      Collector, Thane U/s. 20 of M.L.R.C. (Maharashtra
                      Land Revenue Code) 1966.
               8)     Appeal No.38/03 filed by defendant no.2 against the
                      order passed by the Collector dtd. 18/11/2002.
               9)     Appeal No.97/03 filed by the Plaintiff against the State
                      of Maharashtra and defendant no.2.
       18.     It is also admitted position that defendant no.2 has
               purchased the suit property by various 95 sale deeds from
               the occupants of the suit property. Those sale deeds were
               executed in between 07/05/1928 to 15/06/1951. It is also
               not in dispute that at the time of execution of those sale
               deeds, those lands were the agricultural lands and was
               forming the part of Eksali land under the Indenture of 1870
       .....
    
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        24.     Defendant no.1 was in use and in occupation of the suit
               property. Defendant no.1 is declared as a land holder as
               per the notification (Exh.267) issued after the enactment of
               B.T. and A.L. Act, 1948.          Further by the notification
               (Exh.267) the Government of Bombay assumed the
               management of the Estate under the indenture of lease U/s.
               44 of the B.T. & A.L. Act. The management assumed was
               thereafter terminated by the notification         (Exh.260) on
               01/10/1957 issued by the Governor of Bombay in the
               Bombay Government Gazette which shows that till the
               issuance of the notification defendant no.1 was in control
               and management of the Estate and was exercising the
               rights acquired under the Assignment Deeds of 1945. The
               Government of India has come into existence in 1937. On
               23/03/1938 the letter (Exh.191) was written by the then
               Collector Salt Revenue to the Collector of Thane in which the
               partition of Mira Salt Works was proposed. By the letter
               (Exh.191) request was made for the inclusion of additional
               land belonging to the Government in the salt work.
               Therefore it itself shows that if the suit property was vested
               in the Federal Government then the powers to grant the
               permission was not addressed to the Collector, Thane.
               Section 172 of the Government of India Act provides that
               "All lands and buildings which immediately before the
               commencement of part III of this act were vested in His
               Majesty for the purpose of Government of India as from that
               date". The notification (Exh.192) is produced by the plaintiff
               in which the schedule of the lands and building for federal
               purpose is given. The suit property is not included in the
               said Schedule. The plaintiff also failed to produce any
               document to show that the suit property was held for
               Federal purpose. In the judgment (Exh.262) passed in Civil
               Appeal No.288 of 1956 it is mentioned that, "Relying on
               those provisions it was urged that by reason of assumption
               of management of the lands in dispute under Section 44 of
               B.T. & A.L. Act, the lands had become vested in the State
               Government and the Plaintif11 ptf (i.e. Defendant No.1
               herein) has no interest left therein."
       25.     In the Judgment (Exh.262) passed in Civil Appeal
               No.288/1956, the State Government given an admission
               that the land belongs to defendant no.1 and only on the
               basis of Notification under Section 44 of B.T. & A.L. Act, the
               lands had become vested in the State Government. The
               statement of the State Government shows that the plaintiff
               was never the owner of the suit property.           Moreover
               defendant no.1 has filed the suit bearing no.123/1955,
               288/1972, 244/1978 for the account of the management in
               which the decrees for the accounts were passed and those
               decrees were confirmed even up to the Hon'ble Apex Court.
       26.     As per direction of the Hon'ble Apex court dtd. 18/11/2002,
               the Collector in the Application No.4/1999 passed the order
    
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                in pursuance to the proceeding U/s. 20 of the Maharashtra
               Land Revenue Code for the declaration of the title of the suit
               property. The plaintiff was also the party in the said
               proceeding. In the said proceeding the collector held that
               neither defendant no.2 nor the plaintiff were the owners but
               the Collector held defendant no.3 i.e. State Government was
               the owner of the suit property. The order of Collector was
               challenged by defendant no.2 and also by the plaintiff in the
               Appeal No.38/03 and 97/03 respectively before the Konkan
               Division Bombay. In those proceeding defendant no.1 was
               allowed to participate in respect of his appeal (RTS
               No.133/08). All the three appeals were disposed of by the
               order (Exh.75) by which the Commissioner, Konkan Division
               Bombay set aside the order passed in the Original
               Application No.4/1999.       Appeal No.133/08 was also
               allowed by which all the adverse orders passed against
               defendant no.1 by the Revenue Authorities were set aside
               and Appeal No.97 of 03 filed by the plaintiff was dismissed.
               By the order defendant no.1 was declared as the owner of
               the suit property and defendant no.2 was held as a tenant
               for manufacture of the salt. The collector also in the
               proceeding U/s. 3 of Salsette Act accepting the claim of
               defendant no.1 and passed the Order (Exh.76) by which the
               Tahsildar was directed to enter the name of defendant no.1
               as land holder i.e. superior holder in Kabjedar column. The
               order (Exh.76) was confirmed in writ petition by the Order
               (Exh.77) dtd. 14/07/2011. The Order (Exh.77) was
               challenged in the Letter Patent Appeal. However the said
               appeal was dismissed on 12/10/2011. The order of the
               Collector was confirmed by the Hon'ble Apex Court in
               Special Leave to Appeal (Exh.79) by the           Order dtd.
               28/11/2011. The plaintiff and the Salt Department have
               never intervened inspite of the fact that the name of
               defendant no.1 was ordered to enter in the record of rights
               as superior holder from 1951. Not only this the original
               grantee i.e. Ramchandra Laxmanji was also referred to as
               the Superior Holder by the Chief Secretary of the British
               Government in the Order (Exh.182) dtd. 03/03/1869.
               License No.48(Exh.220) was issued to defendant no.2 for
               Manek Mira Salt Works by the salt department. While
               issuing the license, the provisions of relinquishment of right
               of occupation was deleted and it was substituted that the
               Collector may in consultation with the Collector of Central
               Excise and Salt Revenue, grant permission for the use of
               such land for such purpose subject to payment of non-
               agricultural assessment leviable on the land and to such
               further conditions as the Collector may, subject to the
               general or special orders of the State Government, impose.
               Therefore defendant no.2 by the letter (Exh.234) pointed out
               that this condition was not applicable to Manek Mira Salt
               Works. The license to run Manek Mira Salt Works expired
               on 20/6/1983 and thereafter the Deputy Salt Commissioner
               Bombay issued the notice (Exh.235) to defendant no.2 in
    
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                which it is mentioned that the said salt works stands on the
               Central Government lands and held by defendant no.2 on
               license. Defendant No.2 challenged the notice in the Writ
               Petition No.2861 of 1983 filed against the Plaintiff in which
               defendant no.2 also prayed for the grant and renewal the
               license of Manek Mira Salt Works by the order passed in the
               said writ petition. The Hon'ble High Court grant interim
               license in favour of defendant no.2 and the notice (Exh.235)
               was set aside.         Thereafter the plaintiff filed C.A.
               No.3055/99 against the said order in the Supreme Court.
               The Hon'ble Supreme Court passed the order and directed
               defendant no.2 to approach the Collector, Thane for deciding
               the title of the lands use for manufacture of the salt.
               Defendant no.2 filed the petition U/s. 20 of Maharashtra
               Land Revenue Code for declaring him as an owner of the
               suit property which was decided by the Order (Exh.62).
         27.   The plaintiff witness Hari Krishna admitted that the land s
               purchased by defendant no.2 at Exh. 83 to 181 are the
               private lands and the plaintiff has not raised any objection
               in that regard. Further it was also admitted by him that the
               land of Manek Salt Works was privately owned and
               occupied by defendant no.2. He also admitted that the
               Shapur Salt Works and Manek Salt Works were formed as
               per the sanction given by the Collector of Salt Revenue.
               Thus the contention of ownership was contradicted by the
               plaintiff's own witness.
         28.   To sum up, since 1866 Late Ramchandra Laxmanji and his
               successors which also include defendant nos.1 and 2 are in
               possession of the suit property. The plaintiff has not filed
               any notification on the record to show that the suit property
               is belonging to Federal Government. Defendant no.2 is in
               possession of the suit property. The provisions of
               Government of India Act, 1935 are not applicable to the
               Indenture of Lease. In such circumstances, in view of the
               above discussion there is nothing on the record to show that
               the suit property belongs to the Federal Government and by
               which the plaintiff can claim ownership on it. Therefore, the
               plaintiff has failed to prove his ownership over the suit
               property and they are certainly not entitled to claim the
               consequential relief of claiming the possession of the suit
               property. Hence, the plaintiff is also not entitled for the
               possession of the suit property. Accordingly, I answer Issue
               no.1 and 6 in the negative."
    
    Brief history and relevant facts of the case
    
    5.         Before recording the arguments advanced by the
    parties, having regard to the chequered history of the
    matter, the relevant facts are briefly summarised as follows:
    
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     (a)    By an Indenture dated 7th November 1870 ("the
           Indenture"), the Secretary of State for India in
           Council         granted          and    demised     to     Ramchunder
           Luxumonjee,                    his      heirs,     executors           and
           administrators ("the Grantee") for 999 years, the
           villages       of     Bhayander,          Ghodbunder and             Mira,
           admeasuring approximately 3,688 acres, comprising
           lands of tenures of Inam, Sooti, Wurkus, Assessed
           Sweet Batty, Assessed Eksali and Khajun lands,
           subject to payment of an annual rent of Rs.6,791
           and 9 Annas and 6 Pies per annum payable in two
           equal instalments on 15th December and 15th April
           in each year. The Indenture inter alia permitted the
           Grantee to assign the lands or any part thereof,
           upon notice to the Collector or other revenue
           authorities. In respect of lands other than Khajun
           lands, the Grantee was also vested with the right to
           recover land revenue and to forfeit occupancy in the
           event of default.
    
    (b)     The present suit concerns the Eksali lands, which
           is a smaller portion of lands approximately 220/227
           acres out of the larger land parcel of 3,688 acres.
           The       Indenture             also    contained     various        other
           covenants            and        obligations      binding     upon       the
           Grantee.
    
    (c)    On 1st April 1937, the Government of India Act,
           1935 ("1935 GOI Act") came into force. On 16 th July
           1938, a notification was issued under section 172(1)
           (a) of the said Act, certifying the lands and buildings
    
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            that vested in His Majesty for the purposes of the
           Government of India and which were retained by the
           Governor General in Council for future use. The
           Schedule annexed to the notification enumerates
           lands and buildings used by the Bombay Salt
           Department. Significantly, the suit lands do not find
           mention in the said Schedule.
    
    (d) In 1945, respondent no.1 acquired the rights, title
           and interest of the Grantee under two Deeds of
           Assignment dated 22nd March 1945 and 5th April
           1945.
    
    (e)    Around          1945,          certain     disputes    arose       between
           respondent no.1 and the predecessors-in-title of
           respondent no.2 (at that time - Shapurji Manekji
           Kotwal & Sons), resulting in respondent no.1 filing
           Special Civil Suit no.58 of 1945 before the Civil
           Judge, Senior Division, Thane. Respondent no.1
           inter       alia       sought          a      declaration        that    the
           predecessors-in-title of respondent no.2                           had no
           right to hold the lands in derogation of respondent
           no.1's        rights.          Along     with    reliefs    of    eviction,
           respondent no.1 sought recovery of rent and
           damages. The suit was partly decreed on 25th
           February 1947. The Court held that nothing in Rule
           76 framed under the Bombay Land Revenue Code,
           1921 ("1921 BLRC") deprived respondent no.1, as a
           superior holder of its right to recover the 1/3 rd share
           of paddy from the defendants therein. The Court
           further held that the defendants' contention that the
    
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            remedy of the plaintiff lay against the Government
           of India and that it was a necessary party to the suit
           could not be accepted as there was no contractual
           relationship             between      the    plaintiff      and       the
           Government regarding payment of rent nor any
           privity of estate. Appeal no.236 of 1947 preferred by
           respondent no.1 against the said judgment was
           dismissed by a Division Bench of this Court on 12 th
           July 1950.
    
    (f)    On 19th December 1949, the Government of Bombay
           (Revenue Department), in exercise of powers under
           Section          2(9)      of   the     Bombay      Tenancy          and
           Agricultural Lands Act, 1948 ("BTAL Act"), issued a
           notification declaring respondent no.1 as the "land-
           holder" of the suit lands covered by the Indenture.
           By a further notification also dated 19 th December
           1949 issued under Section 44 of the BTAL Act, the
           State       Government           took      over   possession         and
           assumed           management          of    respondent       no.1/the
           landholder's estate. Subsequently, by a notification
           dated 1st October 1957, this action was reversed by
           the State Government.
    
    (g)    Meanwhile in 1951, the State Government enacted
           the Salsette Estates (Land Revenue Exemption
           Abolition) Act, 1951 ("Salsette Act") to abolish the
           exemption from land revenue enjoyed by holders of
           certain estates situated in villages specified in the
           Schedule           thereto.     The     Schedule     included         the
           villages of Bhayander, Mira and Ghodbunder where
    
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            the suit lands are situated. By virtue of the said
           enactment, the State Government now exercised
           dominion over the suit lands and subjected them to
           the general regime of land revenue.
    
    (h) In 1955, respondent no.1 instituted Suit no.123 of
           1955        against        respondent       no.3    (then     State      of
           Bombay) before the Civil Judge Senior Division,
           Thane, seeking accounts of the income derived from
           the estate during the period the State Government
           had assumed management under Section 44 of the
           BTAL Act. After a contest, a preliminary decree for
           accounts was passed in favour of respondent no.1.
           On 14th September 1956, the State Government filed
           Civil Appeal no.288 of 1956, which was dismissed
           on     14th      December           1957.   A   final    decree       was
           thereafter passed. Appeal no.95 of 1977 and Second
           Appeal         no.784          of   1980    filed   by      the     State
           Government were dismissed on 13th February 1980
           and 27th January 1988 respectively. In the order
           dismissing the Second Appeal, a learned Single
           Judge of this Court rejected the State's reliance on
           the Salsette Act and held that Salsette Act merely
           altered the legal status of the transferees of
           Ramchunder Luxumonjee from sanad-holders to
           owners and it did not affect respondent no.1's suit
           claim arising from wrongful dispossession.
    
    
    (i)    A Special Leave Petition no.11883 of 1988 filed by
           the State Government was dismissed by the Hon'ble
    
    
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            Supreme           Court        on    3rd     November       1988.        This
           concluded            the       litigation        between      the      State
           Government              and     respondent           no.1    which       had
           commenced in 1955 due to the action of the State
           Government               of    taking        over     possession         and
           management of respondent no.1 under section 44 of
           the BTAL Act.
    
    (j)    On 16th July 1983, the Salt Department of the
           Union of India, for the first time, issued a notice to
           respondent no.2 requiring it to execute a lease in
           respect of its lands under Rule 76 of the provisions
           of 1921 BLRC as a condition precedent for renewal
           of Salt Licence no.48 which was issued in 1950.
           Respondent no.2 challenged the said notice by filing
           Writ Petition no.2861 of 1983 before this Court.
           Similar notices issued to other salt manufacturers
           were also challenged in separate writ petitions. In
           all these matters, on 23rd June 1993, the High Court
           directed the appellant to renew the salt licences
           without requiring the manufacturers to surrender or
           cede their title in respect of the lands. On 25 th
           March 1996, a batch of connected Special Leave
           Petitions preferred by the appellant against the High
           Court order dated 23rd June 1993 were dismissed by
           the Hon'ble Supreme Court. While doing so, the
           Hon'ble          Supreme            Court        directed   respondents
           therein         to      approach           the     Collector/       District
           Magistrate for determining the issue of title within a
           period of six months from the date of the order. The
    
    
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            order dated 25th March 1996 of the Hon'ble
           Supreme Court is quoted:
               "Leave granted.
               We have heard the learned counsel on both sides.
               In the appeal arising out of SLP no.15356 of 1992 dated
               26th February 1996, the Division Bench of the High Court
               in Writ Petition no.2333 of 1983 by order dated 29 th July
               1991 directed that the Union of India cannot insist upon
               the respondents conceding to the title of the Government.
               It directed the Union of India to renew the licence without
               insisting upon conceding the title of the Union of India. In
               the appeal, this Court had held that for obtaining
               licence/renewal, title to the property or a lease from the
               owner is a pre-condition. In that case, the Deputy
               Collector had held that the respondent had title to the
               property and appeal thereon was pending. Accordingly,
               this Court had directed the Union of India to grant
               renewal of the licence pending decision on title.
               In these cases, admittedly, no decision on title has yet
               been given by any authority. The respondents are
               directed to file their claims before the competent authority
               (Collector/ District Magistrate, as the case may be) within
               one month from today either as an owner or a lessee from
               the owner. The competent authority is directed to issue
               notice to the Central Government and after considering
               the material and affording an opportunity of hearing and
               after taking into consideration the law on vesting, dispose
               of all those applications on title. Subject to the result
               therein, the licenses under the Salt Act would be issued/
               renewed. Pending decision, the Union of India are
               directed to grant renewal. The authority is directed to
               dispose of those matters within a period of six months
               from the date of the receipt of the copy of the order.
               The appeals are accordingly disposed of. No costs."
    
    (k) On 12th May 1999, the appellant's Special Leave
           Petition no. 14528 of 1998 impugning the High
           Court order dated 23rd June 1993 in Writ Petition
           no. 2861 of 1983 was also dismissed in terms of its
           order dated 25th March 1996 quoted above.
    
    (l)    In view of the aforesaid orders passed by the
           Hon'ble          Supreme       Court,   the    appellant        and
           respondent no.2 filed Revenue Tenancy Settlement
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             (RTS) Applications before the Collector-respondent
            no.4. Both these applications were dismissed by
            respondent no.4 by an order dated 18th November
            2002 and it was held that the suit lands were owned
            by respondent no.3-State of Maharashtra. Being
            aggrieved, both sides preferred appeals 1 before
            respondent            no.5-the    Additional     Commissioner,
            Konkan Division, Mumbai. Respondent no.1 being a
            Grantee, was also permitted to intervene in the
            appeals filed by the appellant and respondent no.2.
            In the meantime, respondent nos.1 and 2 amicably
            settled their disputes as per the Consent Terms
            dated 15th September 2009 filed in Suit no.12 of
            2003.
    
    (m) By a common order dated 8th October 2010, the
            appeals filed by the appellant were dismissed and
            the appeals preferred by respondent nos.1 and 2
            were allowed. The order dated 18 th November 2002
            passed by respondent no.4 was set aside and it was
            held that the appellant had no right, title, or
            interest in the suit lands. It was further held that
            respondent nos.1 and 2 had their respective title as
            owner and tenant of the suit lands, as elaborately
            set     out     in     Annexure    "A"   to    the   said      order.
            Accordingly, respondent no.5 directed mutation of
            the names of respondent nos.1 and 2 in the Record
            of Rights and ordered deletion of the appellant's
            name therefrom.               The operative part of the said
    1
         The appellant filed RTS Appeal no.97 of 2003, respondent no.1 filed RTS
         Appeal no.133 of 2003 and respondent no.2 filed RTS Appeal no.38 of
         2003.
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            order reads as under:-
    
    
                                          "ORDERS
           1.     Appeal No.38 of 2003 by Mira is allowed and impugned
                  judgment and Order dated 18.11.2002 in Application
                  No.4 of 1999 is set aside.      The Appeal of Union
                  Government numbered Appeal No.97 of 2003 is hereby
                  dismissed.
           2.     Appeal No.133 of 2008 is allowed and impugned
                  judgments/orders dated 7/8/1992 in Suo Moto Revision
                  passed by SDO setting aside ME No 4996 and Order
                  dated 3.9.1998 in Revision Application No.62 of 1994
                  both passed by SDO and the Order dated 17.7.2007
                  passed by Deputy Collector in Appeal No.9 of 1993 & 86
                  of 1998 are all hereby quashed and set aside.
           3.     Title of disputed land vests with Estate to the extent of
                  land described in the schedule annexed as Exh A to the
                  Consent Terms dated 15th September, 2009 in Suit
                  12/2003 and Mira is its the Tenant in respect of the land
                  as described in Schedule "A" hereto.
           4.     As for remaining lands out of about 224 acre of the
                  disputed lands, the lands bearing (I) S. Nos 607/6,
                  608/3, 609/5, 610/5 & 611/2 admeasuring in all 14
                  acres 22 ¼ gunthas, (ii) S. Nos 612, 613, 614, 615 (part)
                  & 616 adm in all 27 acres & 10 ½ gunthas all of village
                  Bhayander and land bearing (iii) S No 192 (part) of
                  village Mira adm 17 ¼ guntha and (iv) S. No 614/1 adm
                  1 acre and 617 (part) both of village Bhayendar are
                  concerned, for reasons stated in Para 15 of Mira
                  submissions not controverted by Estate the title of these
                  lands, vests with Mira as Owner thereof. The name of
                  Mira be recorded in the holder column.
           5.     In view of decision on title as aforesaid fresh Mutation
                  Entry be recorded giving effect to this order and that the
                  name of Salt-Department stands deleted.
           6.     In the circumstances, there shall be no order as to costs.
           7.     The concerned authorities not to make mutation entries in
                  terms of this order for a period of four weeks."
    
    (n) Meanwhile, a separate set of proceedings under
           section 3 of the Salsette Act were independently
           initiated by respondent no.4 to ascertain the extent
           of land which, on the appointed date of the said Act
           was covered by section 3(1)(b)(i) and for which the
    
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            estate-holder was liable for payment of land revenue
           to respondent no.3. In the said proceedings before
           respondent no.4, certain third parties were claiming
           that non-agricultural user permission had been
           granted in their favour by respondent no.4. These
           permissions were challenged by respondent no.1
           claiming that the said lands cannot be subjected to
           non-agricultural                use    without       the      consent       of
           respondent no.1. The appellant was not a party to
           these        proceedings.             On      5th   September         2008,
           respondent no.4 passed an order under Section 3 of
           the      Salsette         Act    inter     alia     setting    aside      the
           permissions in favour of such third parties and
           holding that respondent no.1 is the superior holder/
           landholder in respect of the suit lands and the
           Tehsildar was directed to accordingly make entries
           in the revenue records and the Record of Rights.
           The relevant portion of the said order is extracted:
    
           "CONCLUSION:-
           As seen from the records, the village Bhayander was split into
           four villages namely Bhayander, Navghar, Goddev and Khari
           and village Mire was split into three villages namely Mire,
           Penkarpada and Mahajanwadi whereas Ghodbunder village
           continues to remain a single village. The Company have
           produced the list of the corresponding survey numbers-and
           hissa numbers of all eksali / tenanted lands as per the new
           villages as above which is at Exhibit "A" to the Written
           Submission dated 29.07.2008 by the Company. Similarly, in
           respect of the land where whole of the survey numbers is
           concerned, the rights of the Company whereof were released or
           agreed to be released, the Company have furnished the list
           thereof in Exhibit B, reproducing the relevant survey numbers
           and hissa numbers as per new villages names. Likewise in
           respect of survey nos. And Hissa Nos. As per new village
           names, out of which part of the area Exhibit "B" & "C" there
           from would be appropriate. In the result I pass the following
           Order:
                                       ORDER
    

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    I) The claim of the M/s. The Estate Investment Co. Pvt. Ltd. is
    accepted.

    II) The Tahsildar Thane is directed to record the name of
    company M/s. The Estate Investment Company Pvt. Ltd. as
    Land holder / superior holder in kabjedar column of V.F.
    No.VII/XII above the line and the Names which are
    appearing today should be retained below the line in respect
    of the Eksali Tenure/Tenanted lands as shown in Exh. “A”
    as tenants excluding the lands shown in the Exh. ‘B’ & ‘C’
    (as was done earlier by Mutation Entry No.859 of
    Bhayander, 304 of Ghodbunder, and 310 of Mire Village).
    III) The Tahsildar Thane is further directed that in other rights
    column note should be taken for entitlement of land holder /
    superior holder M/s. The Estate Investment Co. Pvt. Ltd. to
    receive rent as per law.

         IV)      No order as to costs.
         V)       The concerned           parties    be     informed    of   this    decision
                  accordingly."
    
    (o)         The aggrieved third parties were objecting to the
    

    alterations in the revenue record on the ground that
    they have a right in some of the suit lands and
    challenged the Collector’s order dated 5 th September
    2008 in Writ Petition no.7500 of 2008 before this
    Court, which was dismissed by the learned Single
    Judge on 14th/15th July 2011 granting the third
    parties liberty to approach the Civil Court to
    challenge the alteration and for adjudication of their
    rights. Further appeals by the third parties before
    the Division Bench of this Court and Special Leave
    to Appeal before the Hon’ble Supreme Court of India
    were also dismissed2. Thus, the order dated 5th
    September 2008 passed by respondent no.4
    declaring respondent no.1 as the superior holder
    under Section 3 of the Salsette Act attained finality.

    2

    The appellant’s Letters Patent Appeal no.264 of 2011 was dismissed by a
    Division Bench of this Court on 11 th October 2011 and the appellant’s Special
    Leave to Appeal no.30804 of 2011 was dismissed on 8th December 2011.

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    Respondent Nos. 1 and 2 have referred to them
    solely as part of the factual narrative to demonstrate
    that the issue of title to the suit lands has
    consistently been contested by the State and/or
    third parties, and never by the appellant.

    6. It is in the backdrop of the aforesaid documents,
    legislative framework and judicial orders, that the appellant
    had instituted the present suit claiming title to the suit
    lands, which has been dismissed by the impugned
    judgment.

    Main issues in this Appeal

    7. The main issues which arise in this Appeal from the
    impugned judgment are as under:

    (i) Whether the appellant continued to be the owner
    of the suit lands after the execution of the
    Indenture of 1870 and upon the enactment of the
    1935 GOI Act?

    (ii) Whether the trial Court has correctly held that the
    appellant has failed to establish its title and
    ownership to the suit lands?; and

    (iii) Whether the impugned judgment ought to be set
    aside as prayer (b) in the suit is not dealt with by
    the trial Court?

    Submissions of the appellant:

    8. Mr. Anil Singh, the learned ASG submitted that the
    trial Court erred in holding that the appellant is not the

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    owner of the suit lands. It was contended that the
    Indenture of 1870 did not convey the ownership or the title
    to Ramchunder Luxumonjee and the same continues with
    the appellant. The learned ASG submitted that the trial
    Court did not correctly analyze the clauses of the
    document. The Indenture is a limited grant as evident from
    the use of the expression “demise” in the document. The
    Indenture did not transfer the title and ownership and the
    then government retained substantial rights, including the
    rights of re-entry and repossession. The learned ASG relied
    upon page 549 of the Gazetteer of Bombay Presidency
    Volume XIII Part II, Thane publication no.B-472 of the year
    1882 where it is recorded that Indenture was a lease for
    999 years and the estates were granted to the Grantee,
    because the villagers refused to keep the large Bhayander
    embankment in repair.

    9. The learned ASG contended that once it is established
    that even after the Indenture of 1870 the predecessor in
    title of the appellant was the owner of the suit lands, the
    only question was how and in what manner the then
    Government of India stood divested of its title to the suit
    lands. That burden lies solely on respondent nos. 1 and 2,
    which it has failed to discharge. The learned ASG submitted
    that sections 2 and 3 of the Government Grants Act, 1895
    specifically provides that the Transfer of Property Act, 1882
    shall not apply to any grant made before the said Act and
    that grant would have to be considered on its own tenor.
    Reliance was placed upon the judgment in “Union Of India

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    & Anr vs Dinshaw Shapoorji Anklesari” 3 to submit that by
    virtue of sections 2 and 3 of the Government Grants Act
    1895, the Transfer of Property Act, 1882 shall not be
    applicable to the government grants.

    10. Without prejudice to the above, it was submitted that
    the right conferred under the Indenture could only be that
    of a “Khot”. Reliance was placed upon the decision in
    Tajubai kom Daudkhan Jangalkhan v. The Sub-Collector of
    Kulaba”4 wherein it was held that Khots were not
    proprietors of land, but only possessed hereditary rights to
    farm it. The learned ASG relied upon Rule 30-C of the 1921
    BLRC to contend that all grants or disposal of government
    lands only involve transfer of rights to use or occupation of
    such lands and does not involve a transfer of proprietary
    rights of the Government in the soil. The mere use of the
    nomenclature “superior holder” could not override or vary
    the express terms of the Indenture, which must be
    construed on its own language.

    11. Insofar as respondent no.2 is concerned, the learned
    ASG submitted that it could not claim rights higher than
    those of respondent no.1 and at best, could only assert
    tenancy rights under respondent no.1. Respondent no.2
    can claim ownership only in respect of certain portion of
    land identified in paragraph 4 of the operative part of the
    order dated 8th October 2010 of respondent no.5, i.e., land
    admeasuring 42 acres. It cannot lay claim to the entire
    220/227 acres of the suit property.

    3

    2014 (14) SCC 204
    4
    Special Appeal no.669 of 1863 – Order dated 1st August 1866
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    12. To establish the appellant’s title, the learned ASG
    submitted that Salt is recorded in Entry 47 of List I in the
    Seventh Schedule of the 1935 GOI Act. As the suit lands
    were being used for salt manufacture they would fall within
    Entry 47 of List I and by virtue of Section 172(1) of the
    1935 GOI Act the title and ownership vested with the then
    Federal Government. Thereafter, by operation of Article 294
    of the Constitution of India, the suit lands continued to vest
    in the appellant. It was accordingly submitted that the
    finding recorded in paragraph 24 of the impugned judgment
    that the 1935 GOI Act (Exhibit-192) did not cover the suit
    lands, or that the appellant had failed to produce a
    notification demonstrating that the lands were property of
    the Federal Government, is misconceived. It was submitted
    that the State Government (respondent no.3) has neither
    pleaded nor asserted any independent claim of title over the
    suit lands. No written statement was filed by it in the suit,
    nor was the order dated 8th October 2010 passed by
    respondent no.5 challenged. In these circumstances,
    respondent no.3 is not the owner and therefore the title and
    ownership in suit lands can only be of the appellant and it
    continued to remain vested in the appellant.

    13. The learned ASG then contended that the trial Court
    erred in failing to adjudicate prayer clause (b) in the suit.
    The suit specifically challenged respondent no.4’s order
    dated 18th November 2002 and respondent no.5’s order
    dated 8th October 2010. This challenge that the order of
    respondent no.5 holding that suit lands have vested in

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    favour of respondent no.1 was independent of prayer clause

    (a) seeking declaration of the appellant’s title and was
    required to be independently adjudicated on merits. Prayer

    (b) of the suit is itself in the nature of a suit for setting
    aside order passed under Section 20(4) of MLRC. The trial
    Court erroneously held that the suit was not maintainable
    and failed to examine the validity of those orders. Even
    under Order 14 Rule 2(1) of the CPC, the trial Court was
    obliged to record findings on all issues after evidence was
    led. If respondent nos.1 and 2 fail to sustain the validity of
    respondent no.5 order dated 8th October 2010, then the suit
    property would necessarily vest in the appellant or the
    State Government, but not in any private party.

    14. The learned ASG submitted that the impugned
    judgment erroneously relied upon the alleged admission of
    its witness PW 1 – Harikrishna Agarwal and held that the
    lands are private lands. He submitted that title cannot be
    diluted or extinguished on the basis of statements or
    admissions by a witness. The alleged admissions cannot
    divest the appellant of its ownership or vest title in
    respondent nos.1 or 2. The investiture of title in respondent
    nos.1 and 2 must be through a valid legal instrument or
    statutory act, which are non-existent in the present case.

    15. Lastly, it was submitted that the various orders
    passed in litigations prior to 1983 or under BTAL Act and
    Salsette Act are irrelevant and not binding, since the
    appellant was not a party to any of the above proceedings.
    The learned ASG relied upon the judgments in Union of

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    India v. Alark Laxman Desai5 “Jagdish Hari Thatte v.
    Municipal Corporation of Greater Bombay”6, “Sathyanath &
    Anr. v. Sarojamani”7, “Vaman Janardan Joshi v. the Collector
    of Thana and the Conservator of Forests” 8,”Vikas Kamalakar
    Walavalkar v. the Deputy Salt Commissioner
    ” 9 “Tata Steel
    Limited v. State of Jharkhand & Ors.
    “10 and “Ambika Prasad
    Thakur & Ors. v. Ram Ekbal Rai (Dead), by his Legal
    Representatives & Ors”11 in support of his contentions and
    prayed that the appeal ought to be allowed by this Court.

    Submissions of respondent no.1:

    16. Mr. Girish Godbole, the learned senior counsel
    appearing for respondent no.1 denied the appellant’s claim
    for title and submitted that the Indenture of 1870 is a grant
    of various categories of land to Ramchunder Luxumonjee as
    Grantee for a term of 999 years. The Bombay Survey and
    Settlement Act, 1865 (“1865 Act”) was enacted after the
    Indian territories came under the direct control of the
    British Crown. Under Section 2(k) of the said Act, a
    “superior-holder” is defined as a person having the highest
    right under a specific grant to hold land or to engage with
    the Government for land revenue due on account of any
    village or estate. The Act also defines the expressions
    “alienated village”, “estate”, “occupant” and “tenant”.
    Section 36 confers a right of occupancy conditional upon
    payment of assessment, which right is declared to be

    5
    2016 SCC Online Bom 9948
    6
    2006 SCC OnLine Bom 1236
    7
    (2022) 7 SCC 644
    8
    Regular Appeal no.9 of 1868
    9
    Suit no. 1172 of 2025
    10
    (2015) 15 SCC 55
    11
    1965 SCC OnLine SC 52
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    transferable and heritable property, and is to continue
    without question so long as the assessment is duly paid. It
    was contended that the statute recognized that an occupant
    shall not be deprived of his right so long as the assessment
    is paid, and such right is treated as proprietary in nature.
    The learned senior counsel submitted that the Bombay
    Land Revenue Code, 1879 (“1879 BLRC” or “1879 Code”)
    was thereafter enacted to consolidate and amend the law
    relating to revenue administration. The 1879 Code inter alia
    defines “alienated”, “estate” and “superior-holder”,
    “occupant”. The same statutory scheme is continued under
    the Maharashtra Land Revenue Code, 1966 (“1966 MLRC”),
    which repealed the 1879 Code. Reliance was placed on
    Sections 20, 29 and 37 of the 1966 MLRC and it was
    submitted that the Grantee was a Class I Occupant and as
    an Occupant, it is entitled to use and occupation of his
    land in perpetuity upon payment of land revenue and on
    fulfillment of terms and conditions annexed to his tenure.
    Mr. Godbole submitted that on the basis of this legislative
    continuity from 1865 to 1966, a person when colloquially
    called an “Owner” is really an “Occupant” in all enactments
    and what is described as “ownership” in revenue
    jurisprudence corresponds to the status of an “occupant” or
    “superior-holder”. The concepts of “alienated village”,
    “estate”, “alienated land” and “superior-holder” have
    remained consistent across the 1865 Act, the 1879 Code
    and the 1966 MLRC. Applying the above framework, the
    learned senior counsel submitted that the Indenture of
    1870 is not a lease, but a grant by which the lands were
    alienated in favour of the Grantee, and the rights of Her

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    Majesty’s Government (thereafter the Provincial
    Government of Bombay) to recover land revenue were
    alienated. The alienation was subject only to reservation of
    mines, metals and minerals. Referring to the clauses of the
    Indenture, he emphasized that the document, when read as
    a whole, constitutes a grant of an estate comprising three
    villages, including the right to recover land revenue and
    other payments from occupants and even existing
    government lessees. No lessor-lessee relationship was
    created between the Secretary of State for India in Council
    and the Grantee by the Indenture of 1870.

    17. Mr. Godbole then referred to sections 99, 100, 107,
    172 and 173 of the 1935 GOI Act and the Legislative Lists
    in its Seventh Schedule. He submitted that Entry 47 of List
    I does not confer title to the appellant and the subject of
    “land” and “land revenue” is covered separately in Entry 21
    and 39 of the List-II (Provincial Legislative List). The learned
    senior counsel submitted that legislative competence under
    the Entries must be examined in light of the purpose for
    which the land is held. Reliance was placed on “Megh Raj &
    Anr. v. Allah Rakhia & Ors.
    “12 to submit that the word
    “land” is sufficient to include every form of land, whether
    agricultural or not and that the term ought to receive the
    widest construction. Invoking the doctrine of pith and
    substance and upon a conjoint reading of Sections 172 and
    173 of the 1935 GOI Act, the entries in the Seventh
    Schedule of the 1935 Act and Article 294 of the
    Constitution of India, the learned senior counsel submitted
    that as the suit lands were not used for salt manufacture at
    12
    1947 SCC OnLine FC 4
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    the commencement of the Indenture, they would not vest in
    the Federal Government merely because, at a subsequent
    stage, salt was manufactured thereon under a licence
    issued by the Salt Department. Such a subsequent license
    issued decades later by the appellant cannot divest
    occupancy rights that have been vested under the
    Indenture.

    18. Mr. Godbole also relied upon the Salsette Act and
    submitted that the grants in respect of villages mentioned
    in the Schedule to the Act, whether called as leases, grants
    or kowls were all instruments of alienation of land revenue
    to the Grantee. Section 3 of the Salsette Act abolished the
    right of the estate-holder to collect land revenue from the
    village and rendered the estate-holders like respondent no.1
    liable to pay land revenue to the State Government.
    Nevertheless, the estate-holder was recognized as a
    superior-holder. Rule 76 of the 1921 BLRC ceased to have
    relevance after the enactment of the Salsette Act. The 1921
    BLRC applies to unalienated land, whereas the suit lands
    formed part of alienated villages. Even otherwise, the 1921
    BLRC contemplated that upon cessation of salt
    manufacture, land revenue becomes payable to the
    Revenue Department and nothing is payable to the Salt
    Department. Thus, Rule 76 merely conferred regulatory
    control over salt works for limited purposes and did not
    affect title. In any case, respondent no.1 did not itself apply
    for manufacture of salt; and merely because inferior holders
    applied for salt licences, the title of respondent no.1 could
    not be extinguished.

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    19. As regards prayer clause (b), Mr. Godbole submitted
    that under the scheme of Section 20 of the 1966 MLRC, the
    determination by respondent no.5 pertains to a claim vis-à-
    vis the State Government. Since the State Government
    (respondent no.3) has accepted the said determination and
    has not initiated any further proceedings, and as the
    enquiry under Section 3 of the Salsette Act has also
    culminated in favour of respondent no.1, the challenge
    under prayer clause (b) becomes academic once prayer
    clause (a) is rejected.

    20. Mr. Aspi Chinoy, the learned senior counsel for
    respondent no.2 submitted that the Indenture constituted
    an absolute and complete grant of the suit lands to
    respondent no.1 as an owner. It was contended that the
    appellant’s assertion of title on the premise that the lands
    were used by respondent no.2 for manufacture of salt and
    thereby served a federal purpose is wholly untenable.
    Entry 47 of List I of the 1935 GOI Act relating to “Salt”
    cannot be construed to mean that any land used for salt
    manufacture automatically vests in the Federal/Union
    Government. In the alternative, it was contended that by
    virtue of Section 172 of the 1935 GOI Act, the lands stood
    vested in the Province of Bombay, i.e., the State
    Government. He invited our attention to the Notification
    dated 16th July 1938 under the 1935 GOI Act, which
    identified lands utilized by the Bombay Salt Department. It
    was contended that the suit lands used by respondent no.2
    were not included therein. This shows that the Federal
    Government did not have any title over the suit lands.

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    Placing reliance on the decision of the Hon’ble Supreme
    Court in Mundra Salt and Chemical Industries13, he
    submitted that disputes of ownership between the Union
    and the State must be adjudicated under Article 294 of the
    Constitution and not under the repealed Section 37 of the
    1879 BLRC. He submitted that on similar facts, when a
    license was issued under the Central Excise Act, the
    Supreme Court had negated the claim of the Union of
    India/the appellant and held that title to the salt pan lands
    did not vest in the Union Government. After the coming into
    force of the 1935 GOI Act, land became a State subject and
    the State exercised continuous dominion over the same in
    all matters. Consequently, no proprietary right accrued in
    favour of the appellant. Hence, the appeal ought to be
    dismissed as the appellant has failed to establish its title.

    21. Reliance was also placed on Section 2(9) of the BTAL
    Act and the Notification dated 19 th December 1949
    recognizing respondent no.1 as the “landholder” of the suit
    lands. According to Mr. Chinoy, this position continued
    under the Salsette Act, under which the suit lands that
    were earlier exempt from payment of land revenue, now
    became liable to payment of land revenue to the State
    Government. Emphasis was laid on the long legislative and
    litigation history referred to earlier to demonstrate that
    until the year 1983, the appellant or its predecessor in title
    never asserted ownership over the lands covered by the
    Indenture of 1870. The claim of ownership surfaced for the
    first time only in 1983 and that too only in respect of 227
    acres of Eksali land acquired and used by respondent no.2
    13
    (2001) 1 SCC 222
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    out of the larger 3688 acres.

    22. Mr. Chinoy submitted that respondent no.3 also does
    not have any title to the suit lands. It was contended that
    proceedings under the Salsette Act has affirmed the status
    of respondent no.1 as owner. Respondent no.5 in the order
    dated 8th October 2010 has referred to various orders and
    statutes and thereafter held neither the appellant nor
    respondent no.3 have title to the suit lands. Though
    respondent no.3-State had challenged the ownership of
    respondent no.1, it has failed in all proceedings, including
    before the Supreme Court. The order passed by respondent
    no.5 has thus attained finality qua respondent no.3-State.
    The appellant does not have any rights or title in the suit
    lands and its appeal ought to be dismissed.

    23. Mr. Saurabh Kirpal, the learned senior counsel
    appearing for respondent no.1 adopted the aforesaid
    submissions and emphasized that the burden lies only
    upon the appellant to establish its title. Such burden
    cannot be shifted onto the respondents unless discharged
    by the appellant. He also relied upon Section 172 of the
    1935 GOI Act to contend that legislative entries merely
    demarcate fields of legislation and do not determine
    ownership or governmental purpose. According to the
    learned senior counsel, manufacture of salt is not per se a
    governmental purpose that confers title over land. The mere
    use of a portion of the land by respondent no.2 for salt
    manufacture does not result in divestment or alteration of
    title. Reliance was placed on the judgments of the Supreme
    Court in “Union of India & Ors. v. Vasavi Co-operative
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    Housing Society Ltd. & Ors.”14, and “Hoechst
    Pharmaceuticals Ltd. & Ors. v. State of Bihar & Ors.
    ” 15 in
    support of the above arguments. It was further submitted
    that despite having knowledge of litigation between the
    respondents inter se, the appellant failed to intervene
    therein. Moreover, the appellant’s witness (PW-1) has
    admitted that there was no instance of the appellant
    exercising or asserting control over the suit lands under the
    1935 GOI Act. Such admission, being unequivocal, is
    binding upon the appellant.

    24. Insofar as prayer clause (b) is concerned, Mr. Kirpal
    submitted that even assuming that the reasoning of the
    trial Court is erroneous, it is well settled that an appellate
    court is entitled to sustain the findings recorded by the trial
    Court on grounds different from those assigned by it,
    provided that the record contains sufficient material to do
    so. Placing reliance on Order XLI Rule 24 of the Code of
    Civil Procedure
    , 1908, it was contended that if this Court
    concludes that the appellant has failed to establish
    ownership, it can uphold the order dated 8 th October 2010
    passed by respondent no.5 on that basis. There would thus
    be no occasion for a remand or re-trial of the case.
    Reliance was placed on “Shivakumar & Ors. v.
    Sharanabasappa & Ors.
    “16 to contend that remand is
    warranted only where the reversal of decree and retrial is
    indispensable. The impugned judgment correctly holds that
    the appellant has no title to the suit lands and the appeal

    14
    (2014) 2 SCC 269
    15
    (1983) 4 SCC 45
    16
    (2021) 11 SCC 277
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    deserves to be dismissed.

    Objection on jurisdiction of the trial Court and
    maintainability of the suit is given up by respondent
    nos.1 and 2 before this Court.

    25. This appeal was heard on several dates. One of the
    findings recorded by the trial Court was that the suit was
    not maintainable and the trial Court had no jurisdiction to
    entertain the suit instituted by the appellant. At the
    commencement of the final hearing, submissions were
    advanced by Mr. Anil Singh, the learned Additional Solicitor
    General of India to assail this finding and have the
    judgment set aside or remanded on this preliminary/limited
    ground. However, during the course of hearing, on
    instructions from respondent no.1 and respondent no.2,
    Mr. Aspi Chinoy, Mr. Girish Godbole and Mr. Saurabh
    Kirpal, the learned senior counsel for respondent nos.1 and
    2 stated that they were neither insisting nor relying upon
    the findings recorded by the trial Court regarding
    jurisdiction and maintainability of the suit. Their statement
    has been recorded in the order of this Court dated 27 th
    November 2025. It was after this concession that the
    learned ASG proceeded to address this Court on the merits
    of the appeal.

    Reasons and Findings:

    26. The central issue in this appeal is whether the
    appellant has succeeded in establishing its title over the
    suit lands. The trial Court, upon a detailed appreciation of
    oral and documentary evidence, has answered this issue
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    against the appellant. After considering the voluminous
    record, the statutory/legal framework and the submissions
    advanced by the parties, we find no reason to interfere with
    the findings recorded by the trial Court.

    Burden of proof is on the appellant to prove its title

    27. It is well settled that in a suit for declaration of title,
    the plaintiff must succeed on the strength of its own
    evidence and not on the weakness of the defendant’s case.
    Section 101 of the Evidence Act, 1872 places the burden
    upon the party who asserts a fact and Section 102 provides
    that where both parties fail to adduce evidence, the suit
    must fail. Though the onus of proof may shift during trial,
    such shifting arises only when the plaintiff establishes a
    prima facie case of a high degree of probability. This law is
    well settled in the judgment of the Hon’ble Supreme Court
    cited by Mr. Kirpal in “Union of India & Ors. v. Vasavi Co-
    operative Housing Society Ltd. & Ors.”17, the relevant
    portions of which are quoted:

    “15. It is trite law that, in a suit for declaration of title, the burden
    always lies on the plaintiff to make out and establish a clear
    case for granting such a declaration and the weakness, if
    any, of the case set up by the defendants would not be a
    ground to grant relief to the plaintiff.

    16. The High Court, we notice, has taken the view that once the
    evidence is let in by both the parties, the question of burden
    of proof pales into insignificance and the evidence let in by
    both the parties is required to be appreciated by the court in
    order to record its findings in respect of each of the issues
    that may ultimately determine the fate of the suit. The High
    Court has also proceeded on the basis that initial burden
    would always be upon the plaintiff to establish its case but
    if the evidence let in by the defendants in support of their
    case probabilises the case set up by the plaintiff, such
    evidence cannot be ignored and kept out of consideration.

    17

    (2014) 2 SCC 269
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    17. At the outset, let us examine the legal position with regard to
    whom the burden of proof lies in a suit for declaration of title
    and possession. This Court in Moran Mar Basselios
    Catholicos v. Thukalan Paulo Avira
    [AIR 1959 SC 31]
    observed that:

    “20. … in a suit [for declaration] if the plaintiffs are to
    succeed they must do so on the strength of their own
    title.”

    18. In Nagar Palika, Jind v. Jagat Singh [(1995) 3 SCC 426]
    this Court held as under:

    “The onus to prove title to the property in question was
    on the plaintiff-respondent. … In a suit for ejectment
    based on title it was incumbent on the part of the court
    of appeal first to record a finding on the claim of title to
    the suit land made on behalf of the plaintiff. The court
    is bound to enquire or investigate that question first
    before going into any other question that may arise in
    a suit.”

    19. The legal position, therefore, is clear that the plaintiff in a
    suit for declaration of title and possession could succeed
    only on the strength of its own title and that could be done
    only by adducing sufficient evidence to discharge the onus
    on it, irrespective of the question whether the defendants
    have proved their case or not. We are of the view that even if
    the title set up by the defendants is found against
    (sic them), in the absence of establishment of the plaintiff’s
    own title, the plaintiff must be non-suited.

    20. We notice that the trial court as well as the High Court
    rather than examining that question in depth, as to whether
    the plaintiffs have succeeded in establishing their title on
    the scheduled suit land, went on to examine in depth the
    weakness of the defendants’ title. The defendants relied on
    the entries in the GLR and their possession or repossession
    over the suit land to non-suit the plaintiffs. The court went
    on to examine the correctness and evidentiary value of the
    entries in the GLR in the context of the history and scope of
    the Cantonment Act, 1924, the Cantonment Land
    Administration Rules, 1925 and tried to establish that no
    reliance could be placed on the GLR. The question is not
    whether the GLR could be accepted or not, the question is,
    whether the plaintiff could prove its title over the suit
    property in question. The entries in the GLR by themselves
    may not constitute title, but the question is whether the
    entries made in Ext. A-3 would confer title or not on the
    plaintiff.”

    28. In the present case, the appellant proceeds on the
    premise that the ownership of the Secretary of State for
    India in Council existed and continued with the Federal

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    Government and its successor government, unless divested.
    The burden is on the appellant to establish this fact. In our
    view, when the appellant filed the suit for declaration of its
    title as owners, the onus cannot be shifted onto respondent
    nos.1 and 2 to establish how the appellant was divested of
    title. The trial Court was required only to render a finding
    on the appellant’s title. If the appellant fails to prove its
    own title, then the suit is liable to be dismissed without
    further examination.

    Nature of the Indenture of 1870:

    29. The entire case of the appellant proceeds on the
    premise that the Indenture while retaining the ownership of
    the appellant, is a limited grant and confers a lease for 999
    years to the Grantee. The learned ASG has urged that
    clause XI, requires prior permission of the Collector in
    certain cases of assignment/transfer and thereby converts
    the Grant into a lease. We are unable to agree with this
    contention. For the sake of convenience, clause XI of the
    Indenture is quoted:

    “XI. That the Grantee his Heirs, Executors,
    Administrators and Assigns shall not assign or
    transfer the premises intended to be hereby
    granted and for the time being subject to this grant
    or any part which with the consent hereinafter
    mentioned shall have been served from the residue
    save and except as an entirety unless he or they
    shall have first obtained the consent in writing in
    this behalf of the Collector or other Revenue Officer
    of having Chief Authority in the district Provided
    always and it is hereby expressly declared agreed
    by and between the parties hereto that if the said
    several payments hereinbefore reserved and
    covenanted to be paid to her Majesty, her Heirs
    and Successors or any part thereof respectively
    shall be behind and unpaid for the space of one
    month after any of the days whereon payment

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    thereof ought to have been made (although no
    formal or legal demand thereof shall have been
    made) or if the Grantee his Heirs, Executors,
    Administrators or shall not well and truly observe
    and perform all and every the covenants clauses,
    conditions and provisoes in these presents
    contained and on his or their part or behalf to be
    observed and performed then and in either or any
    of such cases it shall be lawful for Her Majesty,
    her Heirs and Successors into the said lands and
    premises intended to be hereby granted and for
    the time being subject to this grant to re-enter and
    the same and every part thereof thenceforth to
    have again re-possess and enjoy in her or their
    former estate as if these presents had never been
    made…….”

    30. In our view, the Indenture is not a mere demise of
    possession, but is a grant of a comprehensive estate. The
    Indenture alienates a wide bundle of rights of the Secretary
    of State for India in Council to the Grantee, including the
    right to hold and enjoy the lands, the right to assign and
    mortgage the estate, the right to recover land revenue from
    occupants, with full authority to enforce payment and
    resume possession in case of default. The Indenture, when
    read as a whole, effects an alienation of the proprietary
    rights including fiscal and administrative incidents of
    ownership which ordinarily vest in the government. The
    Indenture transfers to the Grantee a heritable, transferable
    and assignable estate. We find that clause XI of the
    Indenture does not detract from the overall nature of the
    rights conveyed or the character of the Indenture. If the
    intention was to create a lease without affecting title of the
    appellant, the document would have expressly reflected
    such an arrangement. We may note that as the concept of
    lease was recognized even prior to the 1870 Indenture, or
    the Transfer of Property Act, 1882 as evidenced by

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    contemporaneous statutory provisions including sections
    II(e), XIV, XXXVII and XXXVIII of the Bombay Survey and
    Settlement Act, 1865.

    The appellant’s case of retaining “title” is inconsistent
    with the contemporaneous legislative framework.

    31. Mr. Godbole has extensively argued that the
    legislative framework as discussed below recognized
    “superior holders” as the owners of the land. We accept this
    submission as the rights conferred under the Indenture of
    1870 falls within the contemporaneous legislative
    framework. For the sake of convenience, the relevant
    statutory provisions are quoted:

    Bombay Survey and Settlement Act, 1865
    An Act to provide for the survey, demarcation, assessment,
    and administration of lands held under Government, in the
    Districts belonging to the Bombay Presidency, and for the
    registration of the rights and interests of the occupants of the
    same.

    II(e) An “alienated village” is a village, held and managed by
    private individuals, exempt from payment of land
    revenue, or under Acts II or VII of 1863 of the Council of
    the Governor of Bombay, or under a grant of lease fixing
    the Government demand in perpetuity.

    II(f) “Estate” means any land, or interest in land, wherever
    situated, vested in any person or body of persons, and
    separately recognised in the public accounts.
    II(j) “Occupant” is the person whose name is entered
    authorisedly in the Survey papers, or other public
    accounts, as responsible to Government for payment of
    the assessment due upon any field, or recognised share
    of a field.

    II(k) “Superior Holder” is the person having the highest right
    under Government recognised by the custom of the
    country, or resting on specific grant, to hold land or
    engage with Government for the land revenue due on
    account of any village or estate.

    II(l) “Tenant” is the person holding under an occupant or
    superior holder, by a right derived from him, and
    otherwise than by ownership or inheritance.

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    XXXVI. Right of occupancy conditional on payment of
    assessment declared to be transferable and heritable
    property, and to be continuable without question, at the
    expiration of a settlement lease, on the occupant’s
    consenting to the revised rate.

    The occupant of a survey field, or recognised share of a
    field or number, shall not be deprived of his right of
    occupancy in the said field or recognised share of a field
    by any Revenue Officer so long as he continues to pay
    the assessment due thereon. This right of conditional
    occupancy is declared to be a transferable and heritable
    property; and any person, lawfully and authorisedly in
    occupation of any land at the expiration of a settlement
    lease, who shall consent to the rate which may be
    assessed on his land at a revision of assessment, shall
    be continued in his occupancy without question.
    Bombay Land Revenue Code, 1879
    “Preamble”

    “WHEREAS it is expedient to consolidate and amend the
    law relating to Revenue-officers, and to the assessment and
    recovery of land-revenue, and to other matters connected
    with the land-revenue-administration; it is hereby enacted
    as follows:

    3. (1) to (4) ………….

    (5) “estate” means any interest in lands and the
    aggregate of such interests vested in a person or
    aggregate of persons capable of holding the same;
    (10) “to hold land” means to be legally invested with a right
    to the possession and enjoyment or disposal of such
    land, either immediate or at the termination of
    tenancies legally subsisting;

    (11) “holder” or “landholder” signifies the person in whom a
    right to hold land is vested, whether solely on his own
    account or wholly or partly in trust for another person,
    or for a class of persons, or for the public, it includes a
    mortgagee vested with a right to possession;
    (12) “holding” signifies land over which such right extends;
    (13) “superior holder” signifies a holder entitled to receive
    from other holders rent or land-revenue on account of
    lands held by them, whether he be accountable or not
    for the same, or any part thereof, to the Government;
    (14) “inferior holder” signifies a holder liable to pay the rent
    or land-revenue to a superior holder, whether on
    account of such superior holder or Government;
    (15) “tenant” signifies a person who holds by a right
    derived from a superior holder called his “landlord” or
    from his landlord’s predecessor in title;

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    (16) “occupant” signifies a holder of unalienated land, or
    where there are more holders than one, the holder
    having the highest right in respect of any such land.
    (19) “alienated” means transferred insofar as the rights of
    Government to payment of the rent or land-revenue are
    concerned, wholly or partially, to the ownership of any
    person.”

    Maharashtra Land Revenue Code, 1966

    Section 2 : Definitions.– In this code, unless the context
    otherwise requires,–

    (2) “alienated” means transferred in so far as the rights of
    the State Government to payment of rent or land revenue
    are concerned, wholly or partially, to the ownership of
    any person ;

    (8) “estate” means any interest in lands and the aggregate of
    such interests vested in a person or aggregate of persons
    capable of holding the same ;

    (12) “to hold land” or “to be a land holder of land” means to be
    lawfully in possession of land, whether such possession
    is actual or not;

    (19) “land revenue” means all sums and payments, in money
    received or legally claimable by or on behalf of the State
    Government from any person on account of any land or
    interest in or right exercisable over land held by or
    vested, in him, under whatever designation such sum
    may be payable and any cess or rate authorised by the
    State Government under the provisions of any law for the
    time being in force ; and includes, premium, rent, lease
    money, quit rent, judi payable by a inamdar or any other
    payment provided under any Act, rule, contract or deed
    on account of any land;

    (38) “superior holder” except in Chapter XIV means a land-

    holder entitled to receive rent or land revenue from other
    land-holders (called “inferior holders”) whether he is
    accountable or not for such rent or land revenue, or any
    part thereof, to the State Government ; Provided that,
    where land has been granted free of rent or land revenue,
    subject to the right of resumption in certain specified
    contingencies by a holder of alienated land whose name
    is authorisedly entered as such in the land records, such
    holder shall, with reference to the grantee, be deemed to
    be the superior holder of land so granted by him, and the
    grantee shall, with reference to the grantor, be deemed to
    be the inferior holder of such land, and for the purposes
    of sections 147, 151 and 152 of the Maharashtra Zilla
    Parishads and Panchayat Samitis Act, 1961, shall,
    notwithstanding anything hereinafter contained in the
    definition of the word “tenant”, be deemed to be the

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    tenant of such grantor;

    Section 20. Title of State in all lands, public roads, etc.,
    which are not property of others.–

    (1) All public roads, lanes and paths, the bridges, ditches,
    dikes and fences, on, or beside, the same, the bed of the
    sea and of harbours and creeks below the high
    watermark, and of rivers, streams, nallas, lakes and
    tanks and all canals and watercourses, and all standing
    and flowing water, and all lands wherever situated,
    which are not the property of persons legally capable of
    holding property, and except in so far as any rights of
    such persons may be established, in or over the same,
    and except as may be otherwise provided in any law for
    the time being in force, are and are hereby declare to be,
    with all rights in or over the same, or appertaining
    thereto, the property of the State Government and it shall
    be lawful for the Collector, subject to the orders of the
    Commissioner, to dispose of them in such manner as may
    be prescribed by the State Government in this behalf,
    subject always to the rights of way, and all other rights of
    the public or of individual legally subsisting.
    (2) Where any property right in or over any property is
    claimed by or on behalf of the Government or by any
    person as against the Government, it shall be lawful for
    the Collector or a survey officer, after formal inquiry of
    which due notice has been given, to pass an order
    deciding the claim.

    29. Classes of persons holding land.–

    (1) There shall be under this Code the following classes
    of persons holding land from the State, that is to say

    (a) Occupants–Class I,

    (b) Occupants–Class II,

    (c) Government lessees.

    (2) Occupants–Class I shall consist of persons who–

    (a) hold unalienated land in perpetuity and without
    any restrictions on the right to transfer,

    (b) immediately before the commencement of this
    Code hold land in full or occupancy
    Bhumiswami rights without any restrictions on
    the right to transfer in accordance with the
    provisions of any law relating to land revenue in
    force in any part of the State immediately before
    such commencement, and 24[(c) on the 21st
    April 2018, being the date of commencement of
    the Maharashtra Land Revenue Code
    (Amendment) and the Maharashtra Land
    Revenue (Inclusion of certain Bhumidharis in
    Occupants–Class I Permission) Rules (Repeal)
    Act, 2018 (Mah. XLIV of 2018), were holding the

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    land in Vidarbha in Bhumiswami rights with
    restrictions on right to transfer, or in Bhumidhari
    rights in any local area in Vidarbha.]
    (3) Occupants–Class II shall consist of persons who–

    (a) hold unalienated land in perpetuity subject to
    restrictions on the right to transfer;

    (b) immediately before the commencement of this
    Code hold–

    (ii) elsewhere hold land in occupancy rights
    with restrictions on the right to transfer
    under any other law relating to land
    revenue; and

    (c) before the commencement of this Code have
    been granted rights in unalienated land under
    leases which entitle them to hold the land in
    perpetuity, or for a period not less than fifty
    years with option to renew on fixed rent, under
    any law relating to land revenue and in force
    before the commencement of this Code ; and all
    provisions of this Code relating to the rights,
    liabilities and responsibilities of Occupants–
    Class II shall apply to them as if they were
    Occupants–Class II under this Code.

    32. A conjoint reading of the relevant provisions under
    the 1865 Act, the 1879 BLRC and the 1966 MLRC
    demonstrates a consistent legislative framework recognizing
    the concepts of “alienated”, “alienated village”, “estate”,
    “occupant” and “superior-holder”. The expression
    “alienated” denotes a transfer of the government right to
    receive land revenue in favour of a private person, while an
    “alienated village” refers to a village held and managed by
    such person, with exemption from payment of land
    revenue to the State. An “occupant” is a person whose
    name is entered in the revenue record for payment of
    assessment and in actual possession of unalienated land,
    other than a tenant. Section 36 of the 1865 Act confers
    upon an occupant a right of occupancy and expressly
    recognizes such right as heritable and transferable
    property, immune from disturbance so long as assessment
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    is duly paid. A “superior-holder” under 1865 Act and 1879
    BLRC signifies a person having the highest proprietary
    interest in land, with a statutorily recognised right to hold
    the land and recover revenue from inferior holders. We find
    that this conceptual framework of superior-holder is
    substantially preserved under Section 2(38) of the 1966
    MLRC, which while repealing the 1879 Code, retains its
    essential structure. Section 20 of the 1966 MLRC declares
    that all lands, including public roads, bridges, rivers and
    lakes, and all lands not shown to be the property of others,
    vest in the State Government. However, sub-section (2) of
    Section 20 provides that any competing claim by or against
    the State Government shall be adjudicated by the Collector
    upon due notice and inquiry. Section 29 classifies
    landholders into Occupants – Class I (holding unalienated
    land in perpetuity and without restriction on transfer),
    Occupants – Class II (holding unalienated land in
    perpetuity subject to restrictions on transfer), and
    Government lessees. Section 37 of the 1966 MLRC secures
    the occupant’s right to use and occupy the land in
    perpetuity, subject to payment of revenue obligations and
    on the fulfillment of conditions attached to the tenure. In
    the present case, the Grantee clearly answers to the
    description of a Class I-Occupant, enjoying heritable and
    transferable rights in perpetuity. The legislative continuity
    from the 1865 and 1879 enactments through to the 1966
    MLRC affirms a settled position in revenue jurisprudence
    that what is colloquially described as “ownership”
    corresponds to the statutory status of an “occupant” or, in
    appropriate cases, a “superior-holder”. The core concepts of

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    “alienated village”, “estate”, “alienated land” and “superior-
    holder” have remained materially unchanged across these
    enactments. The statutory framework thus accords to the
    occupant, a proprietary interest in the land. Viewed against
    this backdrop, the Indenture of 1870 must be construed as
    effecting a divestment of the Her Majesty’s Government
    revenue and proprietary interests and a corresponding
    conferment of a heritable, transferable and assignable
    estate in favour of the Grantee. The Indenture evidences a
    grant by which the lands stood alienated from payment of
    rent and land revenue as defined in Section II (d) of the
    1865 Code, Section 3(20) of the 1879 BLRC and Section
    2(20)
    of the 1966 MLRC. The reservation of limited rights,
    such as with respect to mines and minerals or prior
    permission of Collector for transfer does not dilute the
    essential character of the grant as one of alienation. Thus,
    in this legislative background, the legal relationship created
    by the Indenture cannot be characterized as that of lessor
    and lessee between the Secretary of State for India in
    Council and the Grantee as is sought to be argued by the
    appellant.

    There is no “title” in appellant’s favour after
    Government of India Act, 1935 or under Article 294 of
    the Constitution of India

    33. The appellant’s next argument on title is based on
    section 172(1) of the 1935 GOI Act read with Entry 47 of
    List I relating to “Salt”. Before dealing with the same, the
    relevant provisions of the 1935 GOI Act and the
    Constitution of India are extracted:

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    “Section 99. Extent of Federal and Provincial laws –

    (1) Subject to the provisions of this Act the Federal
    Legislature may make laws for the whole or any part of
    British India or for any Federated State, and a Provincial
    Legislature may make laws for the Province or for any
    part thereof.

    (2) Without prejudice to the generality of the powers
    conferred by the preceding sub-section, no Federal law
    shall, on the ground that it would have extra territorial
    operation, be deemed to be invalid in so far as it applies –

    a) to British subjects and servants of the Crown in
    any part of India; or

    b) to British subjects who are domiciled in any part of
    India wherever they may be; or

    c) to, or to persons on, ships or aircraft registered in
    British India or any Federated State wherever they
    may be; or

    d) in the case of a law with respect to a matter
    accepted in the Instrument of Accession of a
    Federated State as a matter with respect to which
    the Federal Legislature may make laws for that
    State, to subjects of that State wherever they may
    be; or

    e) in the case of a law for the regulation or discipline
    of any naval, military, or air force raised in British
    India, to members of, and persons attached to,
    employed with or following, that force, wherever
    they may be.”

    “Section 100. Subject matter of Federal and Provincial laws.-
    (1) Notwithstanding anything in the two next succeeding
    sub-sections, the Federal Legislature has and a Provincial
    Legislature has not, power to make laws with respect to
    any of the matters enumerated in List I in the Seventh
    Schedule to this Act (hereinafter called the “Federal
    Legislative List”)
    (2) Notwithstanding anything in the next succeeding sub-

    section, the Federal Legislature, and subject to the
    preceding sub-section, a Provincial Legislature also, have
    power to make laws with respect to any of the matters
    enumerated in List III in the said Schedule (hereinafter
    called the “Concurrent Legislative List”).
    (3) Subject to the two preceding sub-sections the Provincial
    Legislature has, and the Federal Legislature has not,
    power to make laws for a Province or any part thereof
    with respect to any of the matters enumerated in List II in
    the said Schedule (hereinafter called the “Provincial
    Legislative List”).

    (4) The Federal Legislature has power to make laws with
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    respect to matters enumerated in the Provincial
    Legislative List except for a Province or any part thereof.”

    “Section 104. Residential powers of legislation.-

    (1) The Governor General may by public notification
    empower either the Federal Legislature or a Provincial
    Legislature to enact a law with respect to any matter not
    enumerated in any of the Lists in the Seventh Schedule to
    this Act, including a law imposing a tax not mentioned in
    any such list, and the executive authority of the
    Federation or of the Province, as the case may be, shall
    extend to the administration of any law so made, unless
    the Governor-General otherwise directs.
    (2) In the discharge of his functions under this section the
    Governor-General shall act in his discretion.”

    “Section 172. Vesting of lands and buildings-

    (1) All lands and buildings which immediately before the
    commencement of Part III of this Act were vested in His
    Majesty for the purposes of the government of India shall
    as from that date-

    (a) in the case of lands and buildings which are situate
    in a Province, vest in His Majesty for the purposes of
    government of that Province unless they were then
    used, otherwise than under a tenancy agreement
    between the Governor-General in Council and the
    Government of that Province, for purposes which
    thereafter will be purposes of the Federal
    Government or of His Majesty’s Representative for
    the exercise of the functions of the Crown in its
    relations with Indian States, or unless they are
    lands and buildings formerly used for such
    purposes as aforesaid, or intended or formerly
    intended to be so used, and certified by the
    Governor-General in Council or, as the case may be.

    His Majesty’s Representative, to have been retained
    for future use for such purposes or to have been
    retained temporarily for the purpose of more
    advantageous disposal by sale or otherwise;

    (b) in the case of lands and buildings which are situate
    in a Province but do not by virtue of the preceding
    paragraph vest in His Majesty for the purposes of
    the government of that Province, and in the case of
    lands and buildings which are situate in India
    elsewhere than in a Province, vest in His Majesty for
    the purposes of the government of the Federation or
    for the purposes of the exercise of the functions of
    the Crown in its relations with Indian States,
    according to the purpose for which they were used
    immediately before the commencement of Part III of
    this Act; and

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    (c) In the case of lands and buildings which are situate
    elsewhere than in India (except lands and buildings
    situate in Burma or Aden), vest in His Majesty for
    the purposes of the government of the Federation or,
    if they were immediately before the commencement
    of Part III of this Act used for purposes of the
    department of the Secretary of State in Council, for
    the purposes of His Majesty’s Government in the
    United Kingdom.

    (2) Except with the consent of the Governor-General, effect
    shall not be given to any proposal for the sale of any
    lands or buildings which by virtue of this section are
    vested in His Majesty for the purposes of His Majesty’s
    Government in the United Kingdom, or to any proposal for
    the diversion of any such lands and buildings to uses not
    connected with the discharge of the functions of the
    Crown in relation to India or Burma…….”

    Seventh Schedule
    Legislative Lists
    “List I” – Federal Legislative List
    Entry 10 : Works, lands and buildings vested in, or in the possession of,
    His Majesty for the purposes of the Federation (not being
    naval, military or air force works), but, as regards property
    situate in a Province; subject always to Provincial legislation,
    save insofar as Federal law otherwise provides, and, as
    regards property in a Federated State held by virtue of any
    lease or agreement with that State, subject to the terms of
    that lease or agreement.

    Entry 47 : Salt.

    “List II” – Provincial Legislative List
    Entry 21 : Land, that is to say, rights in or over land, land tenures,
    including the relation of landlord and tenant, and the
    collection of rents; transfer, alienation and devolution of
    agricultural land; land improvement and agricultural loans;
    colonization; Courts of Wards; encumbered and attached
    estates; treasure trove.

    Entry 39 : Land revenue, including the assessment and collection of
    revenue, the maintenance of land records, survey for revenue
    purposes and records of rights and alienation of revenue.

    Constitution of India
    Article 294. Succession to the property, assets, rights, liabilities and
    obligations in certain cases:-

    As from the commencement of this Constitution–

    (a) all property and assets which immediately before such
    commencement were vested in His Majesty for the
    purposes of the Government of the Dominion of India
    and all property and assets which immediately before
    such commencement were vested in His Majesty for the

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    purposes of the Government of each Governor’s Province
    shall vest respectively in the Union and the
    corresponding State, and

    (b) all rights, liabilities and obligations of the Government
    of the Dominion of India and of the Government of each
    Governor’s Province, whether arising out of any contract
    or otherwise, shall be the rights, liabilities and
    obligations respectively of the Government of India and
    the Government of each corresponding State, subject to
    any adjustment made or to be made by reason of the
    creation before the commencement of this Constitution of
    the Dominion of Pakistan or of the Provinces of West
    Bengal, East Bengal, West Punjab and East Punjab.”

    Seventh Schedule, List-I – Union List
    Entry 58. Manufacture, supply and distribution of salt by United
    agencies; regulation and control of manufacture, supply and
    distribution of salt by other agencies.

    Seventh Schedule, List-II – State List
    Entry 18. Land, that is to say, rights in or over land, land tenures
    including the relation of landlord and tenant, and the
    collection of rents; transfer and alienation of agricultural
    land; land improvement and agricultural loans; colonization.
    Entry 45. Land revenue, including the assessment and collection of
    revenue, the maintenance of land records, survey for revenue
    purposes and records of rights, and alienation of revenues.

    34. Under the Government of India Act 1919, there was
    no demarcation of legislative powers between the Federal
    Government and the provinces. There was a fundamental
    constitutional change with the 1935 GOI Act, which
    introduced demarcation of legislative powers through
    sections 99 and 100. These provisions read with the
    Seventh Schedule allocated the subjects between Federal
    Government and the Provincial Government through the
    Federal Legislative List-I, Provincial Legislative List-II and
    the Concurrent Legislative List-III. The argument of the
    learned ASG is that as Salt is in List-I and since suit lands
    were used for manufacture of salt, therefore all incidents of
    it including ownership and transfer of salt lands will vest

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    with the then Federal government. In our view, this
    argument is misconceived and proceeds on a fundamental
    misconception. Section 172 provides for vesting of property
    held for the purposes of the Federation and states that all
    lands and buildings that vested in His Majesty for the
    Government of India prior to the commencement of Part III
    of the Act
    (The Governor’s Provinces) would thereafter vest
    in the Provincial Government if situated within a Province,
    except where they were used, intended to be used, or
    retained for purposes of the Federal Government or His
    Majesty’s Representative, as duly certified. Under Entries
    21 and 39 of List-II, land and land revenue matters fell
    within the exclusive provincial field. Consequently, all the
    proprietary rights in land, administration of land revenue
    and regulation of land tenures are matters that vest in the
    Provincial Government. The appellant cannot claim title
    over the suit lands on the basis of Entry 47 in List I of the
    1935 GOI Act. The Indenture was executed when the suit
    lands were agricultural lands, classified by revenue
    tenures. The subsequent manufacture of salt under license
    from the Salt Commissioner few decades later certainly
    cannot vest ownership in the licensing authority or divest
    the Grantee of its proprietary rights in the lands.

    35. It is correctly submitted by the learned senior counsel
    for respondent nos. 1 and 2 that Entry 10 in List-I which
    refers to works, lands and buildings vested in or in the
    possession of His Majesty for the purposes of the
    Federation. The suit lands are not covered by any
    contemporaneous order or notification. Further, Entry 47 of

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    List-I only relates to a field of legislation. It does not ipso
    facto determine ownership of land upon which salt is
    manufactured. Entry 47 only indicates that the Federal
    Government alone had the mandate to legislate matters
    relating to salt. The entries in the three Lists of the Seventh
    Schedule are not sources of legislative power, but
    demarcate the fields within which such power may be
    exercised by the respective government. They are legislative
    heads of an enabling character, intended to define and
    confine the respective spheres of competence of the Federal
    Government and the Provincial Government, both of which
    are expressed in clear and precise terms. The doctrine of
    “pith and substance” is invoked only where reconciliation
    between conflicting Entries is not possible, to ascertain the
    true nature and character of the legislation and to identify
    the Entry to which it properly relates. In our view,
    regulatory control of the salt manufacturing activity is
    distinct from proprietary rights in the land. If the
    appellant’s argument is to be accepted, then it would mean
    that every private land used for salt manufacture would
    automatically vest in the appellant, a proposition
    unsupported by constitutional or statutory scheme.

    36. In “Megh Raj”, the Privy Council had an occasion to
    consider Sections 100, 107 of the 1935 GOI Act and the
    entries in the Seventh Schedule in the context of challenge
    to the validity of the Punjab Restitution of Mortgaged Lands
    Act, 1938
    . Considering the interplay between the three
    Lists, the Court held that “land” in Entry 21 in List-II is
    sufficient in itself to include every rights in land including

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    its transfer, devolution and alienation, making it a
    provincial or State subject. The Court held as follows:

    “…The key to item 21 is to be found in the opening word,
    “land.” That word is sufficient in itself to include every form of
    land, whether agricultural or not. Land, indeed, is primarily a
    matter of provincial concern. The land in each province may
    have its special characteristics in view of which it is necessary
    to legislate, and there are local customs and traditions in
    regard to land-holding and particular problems of provincial or
    local concern which require provincial consideration. It would
    be strange if the land in a province were to be broken up into
    separate portions, some within and some outside the
    legislative powers of the province. Such a conflict of
    jurisdiction is not to be expected. Item 21 is part of a
    constitution and would, on ordinary principles, receive the
    widest construction, unless for some reason it is cut down
    either by the terms of item 21 itself or by other parts of the
    constitution, which has to be read as a whole. As to item 21,
    “land,” the governing word, is followed by the rest of the item,
    which goes on to say, “that is to” say. These words introduce
    the most general concept — “rights in or over land.” “Rights in
    land” must include general rights like full ownership or
    leasehold or all such rights. “Eights over land” would include
    easements or other collateral rights, whatever form they might
    take. Then follow words which are not words of limitation but
    of explanation or illustration, giving instances which may
    furnish a clue for particular matters: thus there are the words
    “relation of landlord” and tenant, and collection of rents. These
    words are appropriate to lands which are not agricultural
    equally with agricultural lands. Rent is that which issues from
    the land. Then the next two sentences specifically refer to
    agricultural lands, and are to be read with items 7, 8 and 10
    of List III. These deal with methods of transfer or alienation or
    devolution, which may be subject to federal legislation, but do
    not concern the land itself, a sphere in which the provincial
    and federal powers are concurrent, subject to the express
    exception of the specific head of agricultural land which is
    expressly reserved to the provinces. The remainder of item 21
    specifies important matters of special consequence in India
    relating to land. The particular and limited specification of
    agricultural land proves that “land” is not used in item 21 with
    restricted reference to agricultural land but relates to land in
    general. Item 2 is sufficient to give express powers to the
    provinces to create and determine the powers and jurisdiction
    of courts in respect of land, as a matter ancillary to the subject
    of item 21.”

    37. In “Hoechst Pharmaceuticals Ltd.”, the Hon’ble
    Supreme Court held that the various entries in the three

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    Lists are not ‘powers’ of legislation, but ‘fields’ of legislation,
    the relevant portion of which is quoted:

    “74. It is equally well settled that the various entries in the three
    Lists are not ‘powers’ of legislation, but ‘fields’ of legislation.
    The power to legislate is given by Article 246 and other
    Articles of the Constitution. Taxation is considered to be a
    distinct matter for purposes of legislative competence.
    Hence, the power to tax cannot be deduced from a general
    legislative entry as an ancillary power. Further, the element
    of tax does not directly flow from the power to regulate trade
    or commerce in, and the production, supply and distribution
    of essential commodities under Entry 33 of List III, although
    the liability to pay tax may be a matter incidental to the
    Centre’s power of price control.

    75. “Legislative relations between the Union and the States inter
    se with reference to the three Lists in Schedule VII cannot be
    understood fully without examining the general features
    disclosed by the entries contained in those Lists”: Seervai in
    his Constitutional Law of India, 3rd Edn., Vol. 1 at pp. 81-

    82. A scrutiny of Lists I and II of the Seventh Schedule
    would show that there is no overlapping anywhere in the
    taxing power and the Constitution gives independent
    sources of taxation to the Union and the States. Following
    the scheme of the Government of India Act, 1935, the
    Constitution has made the taxing power of the Union and of
    the States mutually exclusive and thus avoided the
    difficulties which have arisen in some other Federal
    Constitutions from overlapping powers of taxation.”

    38. This argument of the respondents is also fortified by
    the Notification dated 16th July 1938 issued under Section
    172 of the 1935 GOI Act. The said Notification assumes
    critical importance as it specifically identified the lands and
    buildings then used by the Bombay Salt Department. The
    suit lands are not mentioned therein. This absence is fatal
    to the appellant’s case. If indeed the Federal government
    had retained ownership and title in any capacity including
    of a lessor, the suit lands would have been notified by the
    then Federal Government. In our view, this strikes at the
    very root of the matter. The absence of notification in
    appellant’s favour coupled with continuous recognition by
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    respondent nos.3 to 5, of respondent no.1 rights as
    landholder negates the appellant’s argument of the title and
    ownership in the suit lands vesting in the Federal
    Government. Article 294 of the Constitution of India only
    continues the position of the properties between the Union
    Government and the State as on the commencement of the
    Constitution. As the suit lands were not vested in the
    Federal Government under Section 172 of the 1935 GOI
    Act, they did not vest in the Union of India by virtue of
    Article 294 of the Constitution of India.

    39. In “Mundra Salt”, the Hon’ble Supreme Court held
    that merely because the suit lands were used for
    manufacture of salt, the Union of India cannot claim title
    over the suit lands. In “Mundra Salt”, the land was sold by
    the government in 1952 through a public auction wherein
    Mundra Salt emerged as highest bidder. The sale was
    confirmed. The possession was handed over and the
    bidder’s name was duly entered in the revenue records.
    Land acquisition proceedings were initiated by the local
    municipal corporation and around then, the Union of India
    through the Salt Department asserted title over the salt pan
    land contending that the respondents were merely lessees
    or licensees, and not its owners. Reliance was placed on
    Section 37 of the 1879 BLRC which declared that all lands
    not proved to be privately owned vested in the Crown and it
    was argued that in the absence of proof of title, the land
    belongs to Union of India. This contention was rejected and
    the Hon’ble Supreme Court traced historical evolution of
    land laws and observed that the concept of absolute

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    ownership of lands vested in Crown was a feature of the
    pre-constitutional era when federalism has not yet emerged.
    After coming to force of the Constitution of India, this
    position was fundamentally altered and the question of
    ownership between the Union and the State must be
    determined with reference to Article 294 of the Constitution
    alone and not with reference to obsolete Section 37 of 1879
    BLRC. The Hon’ble Supreme Court dismissed the claim of
    the Union of India and held:

    “12. The legal position which emerges from the aforesaid laws
    appears to be that unless an individual proves his claim and
    title over the land, where the salt work is being carried on,
    such land was deemed to be that of the Government. It is in
    these set of laws, Section 37 of the 1879 Code also projects
    itself in the same manner. Under it, if any individual fails to
    establish his title, the Union Government is presumed to be
    the owner of the land. However, we have to keep in mind,
    when the 1879 Code was promulgated federalism was not
    even born. In other words, then there was no question of
    any right of two Governments to hold the properties between
    them as it is now between the Union and the State
    Governments. Then the right over the land was confined to
    that of the Crown and an individual. That is why Section 37
    of the 1879 Code recognises pre-emptory right of the Crown
    in respect of all lands which are not the property of
    individuals. This conception of exclusive ownership over all
    land by the Crown stood dissolved after coming into force of
    the Constitution of India, under which right over such land
    was conferred both on the Union and the State
    Governments.

    13. In order to adjudicate the controversy in this case it is
    necessary to refer to Article 294 of the Constitution of India,
    which is quoted hereunder:

    “294.Succession to property, assets, rights, liabilities and
    obligations in certain cases.–As from the
    commencement of this Constitution–

    (a) all property and assets which immediately before such
    commencement were vested in His Majesty for the
    purposes of the Government of the Dominion of India
    and all property and assets which immediately before
    such commencement were vested in His Majesty for
    the purposes of the Government of each Governor’s
    Province shall vest respectively in the Union and the
    corresponding State, and

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    (b) all rights, liabilities and obligations of the Government
    of the Dominion of India and of the Government of each
    Governor’s Province, whether arising out of any
    contract or otherwise, shall be the rights, liabilities and
    obligations respectively of the Government of India and
    the Government of each corresponding State,
    subject to any adjustment made or to be made by
    reason of the creation before the commencement of this
    Constitution of the Dominion of Pakistan or of the
    Provinces of West Bengal, East Bengal, West Punjab
    and East Punjab.”

    This article declares which property would vest in the
    Union and which would vest in the State Government.
    Under it, all properties immediately before the
    commencement of the Constitution which vested in His
    Majesty for the purposes of the Government of the
    Dominion of India vests in the Union and all properties
    which vested in His Majesty for the purposes of the
    Government of each Governor’s Province vests in the
    corresponding State and all rights, liabilities and
    obligations of the Government of the Dominion of India
    and of the Government of each Governor’s Province are
    recognised to be the rights, liabilities and obligations
    respectively of the Government of India and the
    Government of each corresponding State. So under this
    article ownership question between the Union and the
    State Government is to be tested and not under
    obsolete Section 37 of the 1879 Code. Faced with this,
    Mr Rohatgi submits that this vesting in favour of the
    State could only be, if before the commencement of the
    Constitution the land was used for the purposes of the
    Government of the Governor’s Province. We have
    already referred to the historical background as to how
    first rights of individual were recognised. Thereafter a
    register was brought into the picture for recording the
    names of such owners including occupancy-right
    holders and later land revenue was charged from such
    holders of such land by the Government of the
    Province, the administration and control of which was
    with the Government of Provinces except when licences
    were issued by the Union under the relevant Salt Act.
    This position becomes more clear, after coming into
    force of the Government of India Act, 1935. The 1935
    Act for the first time effectively demarcated the
    legislative powers of the federal legislature and the
    provincial legislature. Sections 99 and 100 of this Act
    define fields of legislation read with three lists
    contained in the Seventh Schedule. “Land” under Entry
    21 and “land revenue” under Entry 39 fell under the
    Provincial List. When the Constitution of India came
    into force, we find similar entries of “land” under Entry
    18 and “land revenue” under Entry 45 of List II of the

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    Seventh Schedule. This leaves no doubt that both
    “land” and “land revenue” fell under the State List and
    were governed by the State even prior to the coming
    into force of the Constitution of India.

    14. The question of title of the Union in the proceedings under
    the Land Acquisition Act, which is under consideration,
    admittedly is after the enforcement of the Constitution of
    India. Hence the title over the land in question could not be
    that of the Union of India.

    40. It is then contended by the appellant that the trial
    Court failed to construe the Indenture in accordance with
    the Government Grants Act, 1895. Reliance is placed on the
    judgment of the Hon’ble Supreme Court in “Dinshaw
    Shapoorji Anklesari”, “Tata Steel Limited” and decisions of
    this Court in “Vikas Kamalkar Walawalkar” and “Vaman
    Janardan Joshi”. In these judgments, it was held that the
    Transfer of Property Act, 1882 is inapplicable to
    Government Grants Act and such grants must operate
    strictly according to their own tenor. However, the said
    judgements are of no assistance to the appellant. In
    “Dinshaw Shapoorji Anklesari”, the dispute concerned a
    property which was held under an old grant. The
    superstructure had been transferred in favour of Dinshaw
    Shapoorji Anklesaria and others by a grant of lease, but the
    title of the land remained with the Union of India. The
    Hon’ble Supreme Court allowed the appeal of the Union of
    India, reaffirming the principle that a grant of lease of land
    is governed entirely by the terms of the grant, and under as
    per section 3 of the Government Grants Act, 1895, such
    grants take effect according to their tenor notwithstanding
    any rule of law to the contrary. Applying this principle, the
    Court held that the grantee under old grant terms is a mere
    occupier/licensee having no title over the land, so as to

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    entitle him to transfer the land to another person, and that
    it is always open to the Union of India to resume land held
    on old grant terms. The Hon’ble Supreme Court held as
    follows:

    “41. Therefore, it is clear that the Government has unfettered
    discretion and under Section 3 impose any condition,
    limitation or restriction in its grants and the rights, privileges
    and obligations of the grantee would be regulated only
    according to the terms of the grant itself though they may be
    inconsistent with the provisions of any statute or common
    law.

    42. The grants of lands situated in cantonment area under Old
    Grants form a self-contained provision prescribing the
    procedure as to the grant and resumption of the land and
    hence recourse to the civil procedure code or the Specific
    Relief Act
    will not be applicable.”

    Such is not the case here. Similarly in Tata Steel
    Limited, the Hon’ble Supreme Court was dealing with two
    grants by erstwhile Governor of Bihar. While construing
    these two grants, it was held that the rights and obligations
    arising out of any transfer of piece of land or interest by the
    Government, are to be ascertained only from the tenor of
    the document made by the government evidencing such a
    transfer. In “Vikas Kamalkar Walawalkar”, while examining
    a grant of lease, this Court similarly held that the
    provisions of the Transfer of Property Act, 1882 are
    inapplicable to the grants made by the government. In
    “Vaman Janardan Joshi” the grant in question was given by
    the government of Angria and confirmed by the government
    of Peshva. The issue was whether the English law, which
    says that a grant from the Crown is construed most
    strictly against the grantee and most beneficially for the
    Crown, is applicable in India. In that context, the Court
    held that unless a sanad contains word expressly granting

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    the ownership of the soil, it must be held that ownership of
    the soil was not granted. It is significant to note that the
    grants examined by Hon’ble Supreme Court in “Dinshaw
    Shapoorji Anklesari” and “Tata Steel” and this Court in
    “Vikas Kamalkar Walawalkar” were grants which were
    expressly denominated as “leases”, which vested in the
    grantee only a limited, conditional, and terminable right of
    use and occupation, with title in the land remained with the
    grantor. The grant examined in “Vaman Janardhan Joshi”

    was also of a different nature altogether. There is no doubt
    as to the settled legal position that government grants take
    effect according to their own tenor. The grant under the
    Indenture has been construed in its own terms by the trial
    Court and when read as a whole, undeniably discloses that
    what was conferred upon the Grantee was not a mere
    licence to use, but a comprehensive grant of an estate
    which carried with it the plenitude of proprietary rights
    ordinarily incident to ownership. Considering this
    interpretation of the grant of Indenture, the reliance is
    placed on the judgment of this Court in “Tejubhai Kom
    Dadukhan Junglekhan” also fails.

    The appellant’s reliance on Rule 76 of the 1921 BLRC
    is equally misplaced.

    41. The appellant has then sought to establish its title by
    placing reliance on Rule 76 of the Bombay Land Revenue
    Rules, 1921. The said Rule reads as under:-

    “1. Use of land for the manufacture of salt prohibited except
    on certain conditions. No occupant of unalienated land
    (including Khoti and Talukdari) shall use the same or any
    part thereof for the manufacture of salt without the
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    previous permission in writing first of the Collector of Salt
    Revenue, and then of the Collector of the District.

    2. The Collector of the District may, in any case where such
    permission is granted, either-

    (a) require the occupant to relinquish his rights of
    occupation, and to enter into an agreement that such
    land shall be placed at the disposal of the Salt
    Department, subject to a lease in favour of the
    applicant on such terms as the Collector of Salt
    Revenue under the general orders of Government
    may require; or

    (b) permit the use applied for without requiring the
    occupant to relinquish his rights of occupation on the
    following conditions:-

    (i) that the occupant shall pay such fine as the
    Collector may deem proper, not exceeding one-

    tenth of the amount which would be leviable
    under section 66 in a case of unauthorised use,
    and

    (ii) that the occupant shall execute an agreement
    that he will pay to the credit of Salt Revenue in
    lieu of the existing assessment and Local Fund
    cess, such amount or rate as may be imposed
    by the license to be granted by the Collector of
    Salt Revenue in accordance with the general
    and special orders of Government, and shall
    also in respect of the land used conform to all
    the conditions of such license; and

    (iii) that whenever the Collector of Salt Revenues
    declares that the land, or any part thereof, is
    not used or has ceased to be used for the
    manufacture of salt, such land shall forthwith
    become liable to the survey assessment which
    was chargeable upon it immediately before it
    was permitted to be used for the manufacture
    of salt.”

    42. In 1946, this Rule was then amended and reads as
    under:-

    “76(1) [No occupant of unalienated land, whether assessed for
    any purpose or not, shall use the same or any part
    thereof for the manufacture of salt without the previous
    permission in writing of the Collector of the district.
    (2) The Collector may, in consultation with the Collector of
    Central Excises and Salt Revenue, Bombay, grant
    permission for the use of such land for such purpose,
    subject to the payment of non-agricultural assessment
    leviable on the land, and to such further conditions as the
    Collector may, subject to the general or special orders of
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    the Provincial Government, impose].”

    43. It was argued by the learned Additional Solicitor
    General that in order to manufacture salt, Rule 76(2)(a)
    required the occupant to relinquish his occupancy rights
    and place such land at the disposal of the Salt Department
    subject to a lease. We are unable to accept the aforesaid
    contention as a bare reading of the said Rule does not
    reflect that for procuring a license to manufacture salt, the
    occupant was required to surrender its occupancy rights to
    the appellant. Until 1950, no separate license to
    manufacture salt on the suit land was issued. There is no
    evidence of the appellant contemporaneously taking over
    possession of the suit lands under the said Rule 76(2)(a).
    These facts have been confirmed by the appellant’s witness
    PW-1 in his cross-examination, the relevant portion of
    which reads as follows :-

    Paragraph no.14 (@ page no.269 of paper-book)
    “It is true to say that Collector Revenue is the only
    Competent Authority to deal with the issue for conversion of
    the lands for manufacture of salt. The Collector Salt is being
    only consulted before grant of permission for manufacture of
    salt. It is true to say that there must be relinquishment of
    land in favour of Collector Revenue as per Rule 76(2)(a) of
    the rules 1921. I do not know for that purpose there must be
    registered Relinquishment Deed for being the transfer of the
    property. I have not come across any lease deed by Collector
    Land Revenue executed in favour of defendant Nos. 1 & 2
    as contemplated under 76(2)(a). I have come across a final
    order passed by Collector Revenue as per Rule 76(2)(a). I
    have produced it on record in the suit. There is no any
    agreement between defendant No.1 or 2 at one hand and
    salt department on the other hand to place the lands for
    manufacture of salt as contemplated under 76(2)(a) under
    Manik Mira Salt Works.”

    Paragraph no.18 (@ page no.273 of paper-book)
    “It is true to say that as per contents of Exh. 214 only
    Defendant No.1 was competent to make an application to
    convert the land for manufacture of salt and in that case

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    only the question would arise whether to grant or refuse the
    permission. It is true to say that Defendant No.1 never made
    such application. It is true to say that Defendant No.1 never
    asked the salt department or Collector Thana to convert the
    land of Manik Mira Salt Work for salt Manufacturing. It is
    true to say that as per Exh. 214 only Defendant No.1
    established its right over the land of Manik Mira Salt work.
    It is true to say that Defendant No.2 was not permitted by
    Defendant No.1 and 4 to go on for the salt activities. I do not
    know whether in this regard collector Salt had not taken
    any action. I do not know whether I have any document to
    show that any action has been taken against Defendant No.

    1. I have not seen any documents to that effect.”

    44. Thus, the contention of purported relinquishment/
    surrender of occupancy rights in appellant’s favour cannot
    be accepted, merely because respondent no.2 had obtained
    salt manufacturing licenses. In any case, Rule 76 operates
    only in respect of unalienated lands, whereas the suit lands
    were part of alienated villages. After the enactment of the
    Salsette Act 1951, Rule 76(2)(a) ceased to have any
    application, as land revenue was now to be paid to
    respondent no.3.

    45. In the present case, from 1870 and in any case after
    the notification dated 16th July 1938 until 1983, neither the
    British Government nor the appellant asserted ownership
    or exercised proprietary rights over the suit lands. The
    appellant has not produced any contemporaneous record,
    notification, or revenue entry evidencing its ownership or
    control over the suit lands at any point of time. This
    completely negates the appellant’s case on title. Similarly,
    the appellant’s reliance on the Gazetteer of Bombay
    Presidency, which is only an administrative work to provide
    information and assist in local governance cannot be relied
    upon by the appellant to prove title. In any event, the

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    conveyances/ transfer deeds executed by various Eksali
    cultivators-who were tenants of the Grantee (Respondent
    No.1)-in favour of the predecessor-in-title of Respondent
    No.2, from 1928 onwards, are on record and marked as
    Exhibits 83 to 199 by the trial Court. The oral evidence of
    the appellant’s witness (PW-1) further establishes that no
    objection was raised by the appellant in respect of these
    sale deeds.

    46. The relevant portion of the appellant’s witness’s (PW-

    1) cross-examination is extracted below:

    Paragraph no.5 (@page No.266 of Paper Book)
    “I am aware that on 25.03.2013 we have filed affidavit
    admitting the documents at Exh. 181 to 254 in evidence.
    Contents of my evidential affidavit are based on averment of
    the Plaint and those documents.”

    Paragraph no. 6 (@page No. 266 of Appeal Paper Book)
    “The expression “Private Land and Purchase land”, used in
    various documents has reference to (1) land purchased by
    Defendant No.2 (2) land purchased from private parties and
    (3) land sold by Government to defendant No.2. It is true to
    say that sale deed Exh. 83 to 181 are falling in one of the
    aforesaid categories. Plaintiff has never raised any objection
    or filed proceeding about those sale deeds till today. I do not
    know whether Plaintiff has initiated any proceeding or
    disputing those sale deeds.”

    47. The appellant’s claim surfaced only in 1983, and that
    too incidentally in the context of salt licence renewals. No
    explanation is forthcoming as to why the appellant did not
    assert its title over the suit lands for almost 113 years or
    atleast since the 16th July 1938 notification that was issued
    by the appellant’s predecessor government under section
    172 of the 1935 GOI Act. The defense of respondent nos.1
    and 2 cannot be the basis for the appellant to establish its
    title.

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    Respondent no.3 (State of Maharashtra) has no title to
    the suit lands and its claim has been rejected by Courts
    including the Hon’ble Supreme Court of India.

    48. Respondent nos. 3 to 5 have been represented by
    advocates before the trial Court as well as before this Court.
    No Written Statement was filed before the trial Court nor
    has the learned Additional Government Pleader advanced
    any submissions before us. As regards competing claims of
    the respondents to the suit lands, Respondent no.3 had, in
    the past, claimed title against respondent nos. 1 and 2, but
    lost in all proceedings. The historical record is
    overwhelmingly in favour of respondent no.1 as evident
    from the following undisputed facts:

    (i) The notification dated 19th December 1949 under
    Section 2(9) of the BTAL Act declared respondent
    no.1 as the “landholder”. The dispossession of
    respondent no.1 and statutory assumption of its
    management by respondent no.3-State under
    Section 44 of BTAL Act proceeds on the basis
    that the lands were private estates and not the
    property of the appellant. Had the suit lands
    belonged to the appellant, the Provincial
    Government/respondent no.3 may not have
    exercised powers under the BTAL Act. Be that as
    it may, this action of respondent no.3 resulted in
    litigation and after a decree was passed in Suit
    no.123 of 1955 in favour of respondent no.1,
    respondent no.3 reversed its actions and

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    returned the possession to respondent no.1 on 1 st
    October 1957.

    (ii) The Salsette Act subjected the suit lands to land
    revenue and by an order dated 5th September
    2008, respondent nos. 3 and 4 recognized
    respondent no.1 as the land-holder/ superior-

    holder of the suit lands. All challenges to this
    order including up to the Hon’ble Supreme Court
    have failed, affirming this position.

    (iii) The order dated 8th October 2010 of respondent
    no.5 refers to the judgment of this Court dated
    27th January 1988 and after noting that
    respondent no.3 had not filed any written
    statement, held that title of respondent no.3 had
    passed to respondent no.1. As this order is not
    challenged by respondent no.3, this has also
    attained finality at least vis-à-vis respondent
    no.3.

    49. Thus, respondent no.1 has been held to be the owner
    of the suit lands qua respondent no.3. In view of the above
    executive and judicial decisions, the appellant cannot
    contend that since respondent no.3 is not the owner of the
    suit lands, as a corollary, the title to the same will vest in
    the appellant.

    Conduct of the appellant and the admission of its
    witness (PW-1) on the lack of title

    50. It may be noted that during the course of cross-
    examination, the appellant’s witness Harikrishna Agarwal

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    (PW-1) admitted that the suit lands are private lands. PW-1
    also admits that no steps were taken to assert the
    appellant’s title under the above-mentioned statutory
    provisions. The relevant portion of PW-1’s cross-
    examination read as under:

    Paragraph no.10 (@ page no. 268 of the paper-book)
    “It is true to say that sanction under Exhibit 194 was given on
    9th May 1939 i.e. after coming into force of Government of India
    Act, 1935
    . It is true to say that said Act came into force in the
    year 1937. It is true to say that the then Federal or Provincial
    Government or Revenue Authority or Collector Salt had not laid
    any claim over the privately purchased land in the Manek Mira
    Salt Work. I do not know whether those authorities including
    plaintiff had invoked Article 172 of the Act of 1935 or Rule
    76(2a) of Bombay Land Revenue Rules, 1921. However, no
    document in our possession to show that above said
    authorities had invoked Article 172 of the Act of 1935 or Rule
    76(2a) of Bombay Land Revenue Rules, 1921. I have not seen
    come across any such order passed by any of aforesaid
    authority in 1939. It is true to say that the object behind
    bifurcation of Mira Salt Work in two divisions i.e. Shapur Salt
    Work and Manik Mira Salt Work was to maintain distinction
    between the land given on lease to defendant no.2 and the
    land privately owned by defendant no.2.”

    Paragraph no.42 (@ page no. 283 of the paper-book)
    “Now, I have seen Exhibit 192. It is true to say that in that
    notification property reserved for Federal purposes have been
    notified. I do not know there is no other list of the properties for
    Federal purposes like that. Suit properties are not falling with
    the sweep of that notification. I do not know if the lands belong
    to Central Government are exempted from revenue assessment
    and payment. I never come across like situation. I do not know
    whether suit property was subjected to land revenue.”

    51. The learned senior counsels for respondent nos.1 and
    2 have referred to this evidence to show that even PW-1 has
    admitted to the lack of title of the appellant. While the mere
    oral evidence of a witness cannot divest title, the evidence of
    PW-1 is one more factor in testing the credibility of the
    appellant’s claim. The appellant has not produced any
    notification which shows the vesting of the suit lands in its
    favour or that the appellant exercised control/ possession/

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    ownership over the suit lands at any point of time. Even
    after the 1935 GOI Act, the appellant (Union of India)
    admittedly did not invoke section 172 of the said Act or any
    other statutory provisions to assert or claim proprietary title
    over the suit lands. Thus there was no contemporaneous
    act of vesting, no notification, no administrative order, nor
    any assertion of ownership, no entry in any government
    records that would indicate the appellant’s title to the suit
    lands. Had title in fact vested by operation of law, the
    appellant would necessarily have exercised asserted
    dominion and ensured such ownership is duly reflected in
    the official records. The appellant’s failure to do so also
    negates the appellant’s claim on title.

    52. The learned ASG has relied upon the decision of the
    Hon’ble Supreme Court in Ambika Prasad Thakur to
    contend that the admission of PW-1 cannot divest the
    appellant of its title in the suit land. In Ambika Prasad
    Thakur, the trial Court had decided the issue of title in the
    favor of the plaintiff on the basis of inter alia admission of
    one of the defendants. It was held that the admission was
    made under suspicious circumstances and the written
    statement of the said defendant was never formally
    amended. Considering the surrounding circumstances, the
    admission was held to be having a weak evidentiary value.
    Further, the plaintiff did not claim the tenancy rights either
    by an express grant or by adverse possession. In this
    background, the Hon’ble Supreme Court held that the title
    cannot pass by mere admission. The Hon’ble Supreme
    Court held as follows:

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    “13. On the question of title also, the plaintiffs must fail. In the
    plaint, the basis of their claim of title was (a) occupation
    of 426 bighas. 18 kathas and 9 dhurs of Dubha Taufir by
    their ancestor Naurang Thakur as occupancy tenant and
    the record of his rights in the survey papers of 1892 and

    (b) the oral arrangement with the Dumraon Raj. The first
    branch of this claim is obviously incorrect. The survey
    papers of 1892 do not record occupancy tenancy rights of
    Naurang Thakur in 426 bighas, 18 kathas and 9 dhurs.

    In the High Court, counsel for the plaintiffs conceded that
    in the Khasra of 1892-1893 survey the plaintiffs branch
    was recorded as tenant for about 19 bighas only. The
    oral arrangement is not established, and the second
    branch of this claim also fails. The Subordinate Judge did
    not examine the basis of the plaintiffs claim of title. His
    finding in favour of the plaintiffs’ title was based chiefly
    on (1) oral evidence. (2) depositions of witnesses in
    previous litigations, (3) possession, (4) an admission of
    the Maharaja. The oral evidence on the point is not
    convincing. The claim is not supported by the
    documentary evidence. The survey papers of 1892, 1895,
    1904, 1909 and 1937 do not support the plaintiffs claim
    of occupancy rights in the lands in suit. The depositions
    of witnesses in other litigations do not carry the matter
    further. The deposition of Defendant 11, Ram Dass Rai, in
    Suit No. 217 of 1911 is of weak evidentiary value.
    Though admissible against him as an admission, it is not
    admissible against the other defendants. The other
    depositions relied upon do not satisfy the test of Section
    33
    of the Indian Evidence Act. and are not admissible in
    evidence. We have already found that the plaintiffs and
    their ancestors were not in possession of the disputed
    land since 1909. The oral evidence as to their possession
    before 1909 is not convincing, and we are not inclined to
    accept it. The documentary evidence does not support the
    story of their possession before 1909. With regard to the
    admission of the Maharaja in Suit No. 247/10 of 1913
    relating to the plaintiffs’ title to 244 bighas, we find that
    in his written statement the Maharaja asserted his khas
    zeraiti rights and denied the alleged guzashta kastha
    rights of the plaintiffs’ ancestors. It seems that in Bihar
    ‘guzashto kashť means a holding on a rent not liable to
    enhancement, Later, on 10-06-1913, a petition was filed
    on his behalf stating that the plaintiffs’ ancestors were
    tenants in occupation of the disputed land having
    guzashto kasht rights. The Maharaja was interested in
    the success of the suit, and it was necessary for him in
    his own interest to make this admission. The admission
    was made under somewhat suspicious circumstances at
    the end of the trial of the case when the arguments had
    begun. Though this petition was filed, the written
    statement of the Maharaja was never formally amended.
    In the circumstances, this admission has weak

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    evidentiary value. In this suit, the plaintiffs do not claim
    tenancy right either by express grant or by adverse
    possession. Title cannot pass by mere admission. The
    plaintiffs now claim title under clause (1) of Section 4 of
    Regulation 11 of 1825. The evidence on the record does
    not establish this claim.”

    53. We find no such circumstance in the present case.
    The admission by PW-1 is categorically recorded in his
    cross-examination and admits of no ambiguity whatsoever.
    However that is not the sole or even the primary basis upon
    which the trial Court has returned its finding on the issue
    of title. The trial Court’s determination is based on
    appreciation of documentary evidence placed on record by
    the parties and the statutory provisions.

    Non-adjudication of prayer clause (b) in the suit by the
    trial Court is not fatal

    54. The appellant lastly contends that the trial Court
    failed to adjudicate its challenge to the order dated 18 th
    November 2002 passed by respondent no.4 as also the
    order passed by respondent no.5 on 8th October 2010. We
    find no merit in this submission. The challenge to the
    aforesaid orders is completely dependent on the appellant
    establishing its title under Issue no.1. The foundation of
    prayer (b) is the appellant’s asserted ownership and is
    subsumed in Issue no.1. Once the appellant’s principal
    claim of ownership fails, the appellant’s challenge to orders
    passed by respondent nos.3 and 4 becomes academic. The
    heading of section 20 of 1966 MLRC reads “Title of State in
    all lands, public roads etc., which are not property of
    others”. The determination under section 20 therefore
    relates to a claim which is not the property of others and
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    therefore belongs to the State. In the present case,
    respondent no.3 has accepted the determination in favour
    of respondent nos.1 and 2, including under Salsette Act. It
    is not the appellant’s claim that respondent no.3 has the
    title in the suit lands and therefore it is imperative to
    adjudicate prayer (b). In any event, under Order XLI Rule
    24 of CPC
    , the appellate court may sustain the decree on
    any ground borne out by record. It enables the appellate
    Court to dispose of the matter finally without a remand if
    there is sufficient evidence on record, notwithstanding that
    the appellate Court proceeds on a ground different from
    what the trial Court has proceeded. In our view, prayer (b)
    of the suit does not survive independently. An order of
    remand cannot be passed in a routine manner as it
    elongates the life of the litigation without serving the cause
    of justice. Remand of the matter only for prayer (b) is
    neither necessary nor warranted in this case since we find
    that the long course of legislative recognition and judicial
    adjudication supports respondent no.1’s status as a
    superior holder.

    55. The learned ASG’s reliance upon a judgment of the
    learned Single Judge of this Court in the case of “Union of
    India v. Alark Laxman Desai
    ” is also misplaced. By an order
    dated 25th March 1996 passed in Civil Appeal No.6743 of
    1996, the Hon’ble Supreme Court had directed the parties
    to approach the Competent Authority under the Code for
    adjudication on the issue of title of the land. The question
    that arose before the Court was whether such a direction,
    requiring the parties to avail the statutory remedy before

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    the Competent Authority, had the effect of foreclosing their
    right to subsequently challenge any order passed by the
    Competent Authority by way of a civil suit under section 20
    of the 1966 MLRC. This Court answered the said question
    in the negative and held that the direction to approach the
    Competent Authority did not extinguish or foreclose the
    parties’ right to institute a civil suit under section 20 to
    challenge any order that may be passed by the Competent
    Authority. In arriving at this conclusion, this Court
    observed as follows:

    “35. To summarize, the Apex Court directed the parties to
    approach the Competent Authority under the Code for
    adjudication of their grievance. The Respondent
    approached the Competent Authority under Section 20(2)
    of the Code. The order passed by the Apex Court did not
    foreclose the right of the parties after the order is passed
    by the Competent Authority, as available in law. Section
    20(4)
    itself refers to filing of a suit to challenge orders
    passed under Section 20.”

    56. However in the present case, it has become
    inconsequential as the issue of title has been decided
    against the appellant. Even if the suit is remanded to the
    trial Court for adjudication of prayer (b), the end result will
    still be the same as the appellant has not been able to
    independently establish its title. Thus, the reliance placed
    on this decision of “Alark Laxman Desai” is misplaced.
    Reliance on the decisions in “Jagdish Hari Thatte” and
    “Sathyanath” also does not assist the appellant. The said
    judgments lay down the well settled principles under Rule 2
    of Order XIV which mandate the trial Court to pronounce
    judgment on all issues notwithstanding that a case may be
    disposed of on a preliminary issue. The rule also lays down
    that the Court may try the issue of law first if it is of

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    opinion that the case or any part thereof may be disposed
    of on such issue. In “Jagdish Hari Thatte”, this Court was
    only considering the question as to whether it is necessary
    for the Court to decide on all issues on merits if it comes to
    the conclusion that it lacks jurisdiction, at the time or
    before passing an order of the return of plaint. Similarly in
    “Sathyanath”, the trial Court only considered issue relating
    to res judicata and limitation as preliminary issues while
    passing an order under Order VII Rule 11 for rejection of
    plaint. That is not so here. The trial Court in the impugned
    judgment framed eight issues. In the present case, the
    appellant had the recourse of Rule 5 of Order XIV to move
    an application in the trial Court seeking framing of
    additional issue regarding the legality of the order dated
    18th November 2002 passed by respondent no.4 as also the
    order passed by respondent no.5 on 8th October 2010. The
    appellant did not do so. It is not the case of appellants that
    the Issues were not framed properly. The trial Court has
    recorded findings on all of the eight issues framed. The trial
    Court held that the appellant had failed to establish its
    ownership over suit properties and thus it is not entitled to
    claim consequential relief of claiming the possession of the
    suit property. Thus, the mandate under Rule 2 of Order XIV
    of CPC
    has been discharged. Considering the same, there is
    no infirmity in the impugned judgment on the ground of
    purported failure of the trial Court to adjudicate upon
    prayer clause (b).

    57. In conclusion, we find that the trial Court has rightly
    held that the appellant has failed to establish its title.

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    FA-1430-2019-Judgment-corrected.doc Dixit

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    Consequently, First Appeal no.1430 of 2019 is dismissed.
    There shall be no order as to costs.

    58. After the judgment was pronounced, a prayer has
    been made by Mr. Anil Singh, the learned Additional
    Solicitor General for continuing the status quo order dated
    2nd September 2021 passed in Interim Application (St)
    No. 97107 of 2020 with Civil Application No. 384 of 2019.
    In a judgment passed in this First Appeal which arises out
    of a dismissed suit, there cannot be an order for
    continuing of the status quo order as requested on behalf of
    the appellant-Union of India. The prayer is, accordingly,
    rejected.

                           [ GAUTAM A. ANKHAD, J. ]                     [ CHIEF JUSTICE ]
    
    
    BHARAT
    DASHARATH
    PANDIT
    
    Digitally signed by
    BHARAT
    DASHARATH
    PANDIT
    Date: 2026.05.01
    00:41:32 +0530
    
    
    
    
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                          FA-1430-2019-Judgment-corrected.doc                                     Dixit
    
    
    
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