Judgment:
Madan, J.
1. Maharao Brij Singh, Ex-Ruler of Kota has sought a writ of certiorari in this petition for : (1) quashing & setting aside an order dated 26.12.96 (Annex.22); (2) holding (a) survey done by the defence authority and (b) declaration of land being short fall area & Sawai Chak, as void and unconstitutional; and further sought a writ of mandamus for directing the respondents to (i) refund a sum of Rs. 14,13,127/- (already deducted) plus Rs. 1,50,330/- (deposited by him) and (ii) to pay admitted recurring compensation amount without any deduction in respect of a requisitioned land situated at Umaid Bhawan Palace Kota recognised as official residence of the petitioner.
2. Reducing chequered history of facts having been complexed, only facts relevant for the controversy are epitomised in a concise manner. Total campus area of official residence of the petitioner- Umaid Bhawan Palace is 973 acres out of which 918.26 acres (2295 bighas & 13 biswas) were requisitioned by the Collector Kota by order dated 16.9.76 (Ann.3) By virtue of requisition of land measuring 918.26 acres (excluding Umaid Bhawan Palace-45 acres = 112 bighas 10 biswas, Manoj Talkies-8 acres (20 bighas) & Petrol pump .24 acres = 12 biswas) under order dated 16.9.76 (Ann.3), the President of India accorded sanction for payment of recurring compensation @ Rs. 33,28,303/- per annum w.e.f. 20.9.76 till date of acquisition/derequisition whichever is earlier for aforesaid 918.26 acres belonging to Maharaja Bhim Singh, Ex-ruler of Kota, as conveyed by letter dated 01.06.1993 (Ann.6) being issued with concurrence of Ministry of Defence (Finance) vide letter dated 31.5.93 and such a sanction was subject to adjustment of Rs. 1,85,98,630/- already paid as 'on account' payment to the petitioner. Thus, admittedly the requisitioned land 918.26 acres was handed over to the Collector Kota by the petitioner's father on 20.9.76 as is evident from Annexure-4.
3. Albeit various sanctions for relevant periods' requisite compensation for the land in dispute, besides other correspondence & orders etc. have been produced but I will discuss them whenever required for deciding and restricting to the controversy herein. However, as per letter dated 13.1.97 (Ann. 14) undisputably the recurring compensation @ Rs. 33,28,303/- p.a. was decided to be paid commencing from 20.9.76 and at enhanced rate @ Rs. 50 lacs p.a. from 20.9.94 to 31.3.96 besides arrears as under :-
1. from 20.9.76 to 19.9.92 Rs. 5,32,52,848,002. from 20.9.92 to 19.9.93 Rs. 33,28,303.003 from 20.9.93 to 19.9.94 Rs. 33,28,303.004 from 20.9.94 to 31.3.96 Rs. 50,97,318.005 Arrears Rs. 1,43,12,879.00
4. A dispute arose when the Defence Estate Officer Raj as than Jaipur deducted Rs. 14,13,127/- and sent a cheque of Rs. 1,43,12,879/- on account of payment of enhanced compensation/hiring charges to the Collector Kota for its disbursement to the petitioner and assigning the following reasons for the deduction in question by letter dated 7.6.1996 :-
'3. A sum of Rs. 14,13,127/- have been deducted during joint survey carried out by this office technical staff with your representative during Feb. 95, it was found that Army authorities at Kota are in possession of 903.323 acres (902.187 acres of Maharaja land plus 1.136 acres of State Government land) only against 918.26 acres as mentioned in Requisition Order dated 16.9.76 and Handing/Taking Over Certificate.'
'In this regard your kind attention is invited to this office letter dated 9.5.96 cited under reference where incomplete details have been forwarded to you. Further this office SDO-1 Shri S.K. Sharma was detailed on 27.5.96 to contact discuss the matter with you. He has intimated that after discussing the issue with him & your officers, you have agreed in principal that we can deduct the amount for area found less during joint survey.'
'Your kind attention is also invited to the provisions of Section 194-1 of the Income Tax Act, 1961 as amended for compliance as regard recovery of income tax at source and, therefore, the same be deducted while making payment.'
5. Against aforesaid deduction (Ann. 15) the petitioner moved an application (Ann. 20B) on 4.7.97 praying for directing military authorities to produce the record of joint survey, before the Estate Officer Kota in a case instituted on notice dated 15.2.97 issued Under Sections 4(2)(11)(B) and 4(1) of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971, as necessary for decision of the case.
6. Thus the controversy arose only upon a joint survey of the requisitioned land according to which the military authorities were in possession of only 902.187 acres of the land in dispute as the arrears of recurring compensation was directed to be paid for 902.187 acres of land. The petitioner made his representation on 05.08,97 (Ann.20B) protesting the alleged joint survey as also deduction by reminders to the Director General (Defence Estate) on 19.8.97 for release of the withheld payment under protest, besides with the request not to deduct the income tax at source. The petitioner in his letters (Ann.20C, 20D, 20E) requested to the Director General (Defence Estate) for directing the Collector, Kota to release the TDS sum of Rs. 21,46,972/- deducted from Rs. 1,43,12,879/- as the Umaid Bhawan Palace land property is free from Income Tax, but ultimately TDS income tax amount Was not paid and was got deposited in the Bank through IT challan No. 11/dated 28.9.96 - a copy whereof was sent by the Collector Kota to the Defence Estate Officer Jaipur with letter dated 28.9.96 (Ann.20F)
7. However, ultimately the Collector Kota by his letter dated 26.12.96 (Annex.22) intimated the petitioner that out of 918.26 acres of requisitioned land in dispute of Umaid Bhawan Palace compound Kota, only 902.18 acres were found in possession of the defence authority according to survey done by the Revenue & Defence Departments, and 1.136 acres of requisitioned land was Siwai Chak (Government) land, of which the recurring compensation was worked out as Rs. 99,751/-plus 1% interest p.a. - pursuant to which the petitioner deposited Rs. 1,50,330/- - refund of which is also sought in this petition.
8. Shri K.K. Mehrish learned counsel for the petitioner contended that holding a joint survey of the requisitioned land in dispute and thereby reducing 918.26 acres to 902.187 acres on the part of respondents (Union of India, Collector Kota & Defence Estate Officer) resulting into deduction of requisite recurring compensation on that account, is totally void and illegal. Shri Mehrish further challenged the action of the Collector Kota in holding that out of the land in dispute in possession of the defence, 1.136 acres was 'Siwai Chak', and contended it to be void and illegal being arbitrary. Thus it is the case of the petitioner that deductions of Rs. 14,13,127/- towards alleged short fall of land in possession of the defence, and of Rs. 21,49,932/- towards TDS income tax on total amount of recurring compensation paid, deserve to be refunded to the petitioner. Shri Mehrish also assailed the action of the respondent No.2 in holding 1.136 acres of land out of requisitioned land of 918.26 acres as 'Siwai Chak' land being void and illegal and, therefore, Rs. 1,50,330/- deposited by the petitioner towards declaration of 1.136 acres as Siwai Chak land, is sought to be refunded.
9. On the contrary, Sarva Shri Bharat Vyas learned counsel for the respondent Union of India, Shri K.C. Sharma learned counsel for the respondent No.2 Collector not only in their reply to the petition but also during the course of hearing contended that the issues having been raised by the petitioner in this writ petition are disputed questions of fact and, therefore, they cannot be adjudicated upon by this Court in its writ jurisdiction. It is the case on behalf of the respondents that out of the requisitioned land, 864.42 acres belonging to the petitioner's father Maharaja Bhim Singh were declared as surplus by the Competent Authority under the Urban Land Ceiling & Regulation Act, 1976 (for brevity 'the Ulcar Act') - in support of this contention, judgments dated 6.5.98 (Ann.R1) and 23.4.98 (Ann.R2) were produced to show that in case of the petitioner (Brij Singh), 6,17,302 sqm of land and in case of Bhuvneshwari Kanwar, 99,179.22 sqm of land stood declared as surplus, but so far as petitioner's father is concerned, matter was still pending for adjudication before the Competent Authority under the Ulcar Act, Kota and thereby the petitioner has lost his rights to prefer this writ petition.
10. It was further case on behalf of the respondents that a joint survey having been carried out by a Settlement Team in association with the Revenue Department Kota & Defence Department in March/April, 1995 cannot be questioned in any forum in accordance with law. Much stress was also laid on behalf of the respondents thatonce the Collector Kota (respondent No.2) had already ordered resurvey of the requisitioned land in dispute under order dated 17.10.1997 (Ann.R3) with a copy having been endorsed to the petitioner, he ought to have not concealed such a significant fact from this Court rather he kept on watching to the outcome of resurvey by overriding the competent authority by approaching contemporaneously this Court also and therefore, the petitioner deserves to be directed to seek redressal of his grievance before the Collector Kota.
11. As regards an area measuring .76 acre of Khasra No. 54 of village Dostpura, it is the case of the respondents in the reply that a complaint (Ann.R4) was filed by the Defence Authority Kota alleging encroachment upon this piece of land by the Ex-ruler and thereupon the Estate Officer initiated proceedings (Ann.R.5) under the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 (for short the Public Premises act) wherein on 6.9.97 an undertaking had been given on behalf of the petitioner inasmuch as he in his application dated 5.3.97 (Ann.R6) to the Collector admitted that area occupied by Mayur Petrol Pump was 2.4 bighas = 1 acre.
12. So far as joint survey of 1995 is concerned, only contentions urged on behalf of the respondents in, their reply was that such a survey was based on joint inspection-cum-survey having been personally witnessed by the Power of Attorney Holder of the petitioner though he refused to sign this survey proceedings.
13. In rejoinder to the reply filed on 11.3.99 it has been contended by the petitioner that there was no question of having drawn inference that the facts and circumstances of the present writ petition did not raise disputed questions of fact, rather in view of the admissions wrung out of the pleadings and documents produced on record the present case involves only to draw inference from admitted facts which amounts to a question of law. As regards the proceedings under the Ulcar Act against the petitioner's father, in contra it has been the case on behalf of the petitioner in rejoinder that once admittedly such proceedings are stated to have been pending with no final outcome thereunder, except in cases of Brijraj Singh (petitioner) a Bhuvnesh-wari Kanwar in whose cases though judgments had been given but they are under challenge in appeal before Divisional Commissioner Kota who issued stay orders on 9.6,98 and 15.5.98 (Ann.24 & 25), inasmuch as the Central Government had promulgated an Ordinance withdrawing and repealing the Ulcar Act, 1976, (as announced in Lok Sabha on 11.1.99 duly adopted by the Rajasthan State Assembly on 23.9.99), therefore, respondents have no case to assert that the petitioner or other co-parceners have lost their title in the land in dispute because by virtue of repealing the Ulcar Act, itself, the judgments impugned and challenged in appeal before the Divisional Commissioner stood non-est & thereby the proceedings under the Ulcar Act, 1976 stood abated automatically.
14. In rejoinder it has also been the case of the petitioner that the proceedings in a case under the Rajasthan Land Reforms & Acquisition of Land Owners Estate Act, 1963 had been decided in favour of the petitioner by judgment (Ann.26) As against reply of the respondents as to the Siwai Chak land, it is averred in the rejoinder that since the entire 918.26 acres of land was surrounded by the Pucca Ahata (masonary boundary) and being situated in the heart of Ummed Bhawan Palace, no part thereof could be 'Siwai Chak' and, therefore, the respondents have no case to hold 1.136 acres out of 918.26 acres of land in dispute as Siwai Chak - of which recurring compensation has illegally been withheld by not paying it to the petitioner.
15. Having given earnest consideration to the rival contentions urged not only in the pleadings in writ petition, reply and rejoinder but also during the course of hearing, in my considered view it is not in dispute that on the basis of joint survey of the requisitioned land (918.26 acres) of Ummed Bhawan Palace compound in 1995, the respondents were held in possession of only 903 acres as requisitioned land, so deductions were made while paying recurring compensation to the petitioner for alleged short fall (15 acres including 1.136 acres held as 'Siwai Chak' by the Collector) forever. This leads me to first decide the fateful and crucial question in this petition as to whether the respondents were justified in (1) conducting joint survey of the requisitioned land and thereby (2) further holding only 903 acres in possession of the defence resulting into (3) making deductions towards alleged short fall of land in possession of the defence but of recurring compensation payable to the petitioner as per sanction of the President for total requisitioned land (918.26)
16. At the time of hearing, much stress was laid a have a look at some of judgments & letters on record so as to find out nature of the land in dispute. In exercise of his jurisdiction as competent authority under the Requisitioning & Acquisitioning of Immovable Property Act, 1952 (for short the Requisition Act) under his order dated 23.8.90 (Ann.19) while deciding a case as to the classification & nature of the land in dispute admittedly belonging to the petitioner's father having been requisitioned for defence purpose, Collector (Land Records) Kola in a categorical conclusions drawn as per land records & material on record held that land (918.26 acres) requisitioned by Collector in 1976 is an urban land and there was no ground for interfering with existing entries in land records as 'Aahata Ummed Bhawan Kothi' as already stood decided in his earlier order dated 7.6.92. After having held this requisitioned land in dispute as Urban land, the Collector (Land Records) also determined the recurring compensation amount payable to the petitioner's father (Maharao Bhim Singh) for such requisitioned land under the Requisition Act and its Rules and such determined annual recurring compensation payable from the date of requisition of land for defence purpose was subsequently revised as already stated herein above.
17. Further from para 4 of the reply on behalf of the respondent Nos. 1 & 3 it is crystal rather admitted position that joint survey was carried out by the Settlement Team in association with officials from Revenue Authority Kota, Station Head Quarters Kota and the respondents in March/April, 1995. It is the case in reply of the respondents that they survey carried out by a Settlement Team cannot be challenged at any forum and the objection by the petitioner as to such survey is against the Land Reforms Acts/Rules. Thus joint survey was conducted under the Land Reforms Acts/Rules as is admitted case of the respondents. This leads me to decide a question as to whether provisions of the Rajasthan Land Revenue Act, 1956 could be invoked by the respondents to settle the dispute as to the area of requisitioned land in question. Chapter VI of the Land Revenue Act deals with the rights being possessed in land by the State Government and its tenants or assignees. Section 103 falls in Chapter VI and it defines 'Land and Abadi' for the purpose of Chapter VI as follows:-
'103. Land & Abadi defines for purpose of Chapter VI:
For the purposes of this Chapter, unless the subject or contest otherwise requires -
a) 'land' means land belonging to all or any of the following categories:-
i) land as defined in clause (24) of Section 5 of the Rajasthan Tenancy Act, 1955 (Rajasthan Act 3 of 1955);
ii) land as required under the provisions of the Rajasthan Land Acquisition Act, 1953 (Rajasthan Act 24 of 1953) for the purpose of Government or a local authority or an educational institution while such land remains the property of Government or such local authority or educational institution as the case may be;
iii) land surveyed and recorded, whether before or after the commencement of this Act, during any proceeding relates to survey and preparation of records or otherwise, as belonging to the Government or a local authority, which is used for any public purpose such as a road or pathway;
(iv) land surveyed and recorded as aforesaid for the use of the community such as gocher, cremation ground or graveyard.
v) land in possession of the Government or a local authority obtained by transfer otherwise.
vi) Nazul land as defined in clause (iv) of Section 3; and
vii) land within the abadi area vesting in a local authority or land reserved and set apart for special purposes under Section 92, and includes benefits to arise out of such land and things attached to the earth or permanently fastened to anything attached to the earth;
b) 'abadi' or 'abadi area' or 'abadi land' means the populated area of a village, town or city and includes the site of such village, town or city, land reserved and set apart under Section 92 for the development of abadi therein and land held therein for building purposes whether a building has been constructed thereon or not.'
18. Thus it stands established that the urban lands owned and possessed by private persons do not fall within the definition of the word 'land' as given in Section 103 of the Act and as such no proceedings could be held under the Land Revenue Act as to the lands of Ummed Bhawan Palace compound. Section 3(1)(i) of the Act defines 'Land Records Officer' as follows:-
'Lands Records Officer' shall mean the Collector and shall include Additional or Assistant Land Records Officer.'
19. 'Land Records Officer' authorises the Collector of the District to act as Land Records Officer for the purposes of the Land Revenue Act and thereby the District Collector can exercise powers of Land Records Officer only in respect of the lands which fall within the ambit of definition of 'land' as given in Section 103 of the Land Revenue Act. Since the lands of Ummed Bhawan Palace Compound, Kota are 'urban lands' and do not fall in the category of lands as defined in Section 103 of the 'Land Revenue Act, therefore, the Collector has no power and authority to deal with the lands of Ummed Bhawan Palace Compound.
20. Shri Mehrish drew my attention to the provisions of Sections 106, 107, 112, 114, 127, 131, 132 & 136 of the Land Revenue Act. Section 106 deals with survey or resurvey. Section 107 pertains to record operations. According to Section 127 upon closure of survey and record operations, all applications & proceedings pending before Additional Land Records Officer are to be transferred to the Collector. Under Section 131 the Land Records Officer has to maintain map and field book for the purpose of maintenance of records of rights Under Section 132. Be that as it may, powers Under Sections 131, 132 & 136 of the Land Revenue Act are conferred by Notification dated 17.9.56 of the State Government on the Sub-Divisional Officer and, therefore, appropriate forum for deciding disputes Under Section 136 in so far as the provisions of Land Revenue Act apply is the Court of Sub-Divisional Officer (as notified by the State Government by order dt. 17.9.1956 (No. 12(183) Rev.B/56) in exercise of its power conferred by clause (b) of Section 260 whereby it has been directed that the duties imposed and powers conferred by Sections 131, 132 & 136 of the Land Revenue Act on the Land Records Officers shall be performed & exercised by the Sub-Divisional Officers) and accordingly the Collector has no jurisdiction to entertain any application Under Section 136 and that apart even if any joint survey was ordered by the Collector as regards Ummed Bhawan Palace compound lands, it was totally without jurisdiction especially when the Land Revenue Act does not apply to the requisitioned land of the petitioner as the same being Urban land and having not fallen within the ambit of definition of lands contemplated Under Section103 of the Land Revenue Act. Moreover, as laid down in Kaushalya Devi v. State of Rajasthan (1) by this Court, where a particular revenue village having been declared into an 'urban area', the Land Revenue Act will cease to have any application and value.
21. Further more, had any survey been conducted at the instance of the Collector Kota (may be on the request of the defence authority) in 1995, but to utter dismay, what prevented either the defence authority or the Collector to issue notice to the person from whose possession admittedly the land of Ummed Bhawan Palace was requisitioned by the defence, measuring 918.26 acres (for which also the President of India accorded sanction for payment of annual recurring compensation from the date of requisition till the derequisition or acquisition thereof vide Ann.3) Survey report (Ann.R7) shows that it was submitted to the Tehsildar Ladpura (Kota) on 1.5.95 and was prepared on 26.4.95. However, it stands crystal that it was prepared at the back of the petitioner and without issuing notice to him which offends constitutional mandate as to principle of natural justice and so, it being arbitrarily and against the principles of natural justice violated constitutional provisions. Above all, once the survey stood done vide report (Ann.R7) in 1995, again it is surprise as to why the Collector further issued orders for resurvey of land vide letter dated 17.10.97 (Ann.R3) on the letter of Defence Estate Officer dated 15.7.97, directing Dy. Collector Kota to do resurvey of requisitioned land 918.26 acres in the presence of representatives of the defence authority and the petitioner, whereas prior to 17.10.97 the respondents had already made deductions of the alleged short fall area found in possession of the defence authority out of payment of the recurring compensation vide letter dated 7.6.96 on the basis of survey of 1995, which was against the principles of natural justice. Even no notice or opportunity of hearing by following principles of natural justice in consonance with the constitutional mandate has been given either before making survey of requisitioned land on 26.4.95 or in 1997, or making deductions from payment of recurring compensation on the basis of such 1995 survey report (Ann.R7) Further it is not obvious from the reasons assigned in letter dated 7.6.1996 for the deduction in question or in the survey report (Ann.R7) as to for which of periods, the deductions have been made.
22. As regards 'Siwai Chak' land it is not in dispute that entire requisitioned land 918.26 acres has been duly surrounded by a Pucca Ahata (masonary boundary) inasmuch as its walls are partly grilled, fitted with iron gates & pillars which too are owned by the petitioners and being situated in the heart of Ummed Bhawan Palace compound, no part of it could be 'Siwai Chak' nor was there any basis for a stand having taken by the respondents that 1.136 acres out of total requisitioned land 918.26 acres was 'Siwai Chak' so its compensation was not payable. Hence, it cannot be held that any part of requisitioned land can be 'Siwai Chak' or government land and, therefore, the Collector was legally wrong in holding 1.136 acres of land as 'Siwai Chak'. Therefore, a sum of Rs. 1,50,330/- deposited against such allegedly 'Siwai Chak' land is liable to be refunded to the petitioner.
23. As regards existence of a Petrol Pump on Khasra No. 69 of village Dostpura, Tehsil Ladpura, it is not in dispute that this petrol pump was installed by Bharat Petroleum on the requisitioned land after having obtained no objection certificate of the Collector even before requisitioning of 918.26 acres of land for defence purpose. Moreover, it is crystal from lease deed (Ann.R3) that petrol pump's area is 40000 sq.ft. equivalent to 2.4 bighas of land, therefore, to mention .24 acres in the order of requisition of land in dispute is perse incorrect and, therefore, the petitioner was entitled to retain 2,4 bighas for petrol pump.
24. 1 may hasten to reiterate that in the instant case, Collector Kota had requisitioned 918.26 acres of land of Ummed Bhawan Palace Compound for defence purposes under Annexure 3 - possession whereof was taken over by the Defence Authority under Annexure 4 which is duly signed by representatives of Kota Collector, Defence Estate Officer Jaipur so also of Late Maharao Bhim Singh (father of petitioner) Therefore, once it stands established that the defence authority had taken over possession of 918.26 acres of lands under memo of taking and handing over, showing therein all Khasra numbers of villages Dostpura, Khand Gaonri, Kherli & Ladpura, its areas having been entered in the relevant Jamabandies thereto as per rules, at the time of requisitioning the land of Ummed Bhawan Palace Compound in the year 1976, the respondents are now estopped from contending after a lapse of about 17 years that the area of requisitioned lands of Ummed Bhawan Palace in their possession has not been 918.26 acres but only 903.323 acres which too on the basis of illegal joint survey or resurvery having been made in violation of principles of natural justice and at the back of the petitioner. Above all, requisitioning order (Ann.3) has neither been altered nor amended, nor the sanction of the President of India dated 1.6.93 (Ann.6) was got amended and in this view of the matter so long as the requisition order and sanction thereof (Ann.6) accorded by the President of India, it did not lie in the mouth of the Defence Authority to hold by itself that they are not bound to pay for entire requisitioned land of 918.26 acres and thus their stand was totally unwarranted and deserves to be set at naught.
25. Once the survey of 1995 is held as null and void, having been done without jurisdiction, against the provisions of the relevant Act under which it was done, so also in violation of the constitutional mandate, as a legal and logical corollary thereto, the deductions made on such illegal survey or resurvey are liable to be held as illegal and bad in law, and accordingly such illegal deductions made out of recurring compensation amount besides the deposit against Siwai Chak land, under impugned order (Ann.22) deserves to be refunded in favour of the petitioner. Thus viewed, I do not find that there are disputed questions of fact inasmuch as held above, the controversy lunged on admitted facts of, requisitioning the land in dispute, its possession having been taken by the defence, sanction having been accorded by the President of India for 918.26 acres of requisitioned land, so also order of recurring compensation, and the joint survey resulting in deductions in question admittedly having been done in violation of principles of natural justice as also the constitutional mandate.
26. As regards the respondents' contention that by virtue of enforcement of the Ulcar Act, 1976, the petitioner had lost his right in the land in question, I find no merit in such contention because undisputably this Ulcar Act 1976 stood repealed on 11.1.99 by Lok Sabha so also as adopted by Rajasthan Assembly on 23.9.99 and thereby even the Divisional Commissioner Kota did also order abatement of proceedings under the Ulcar Act, 1976 pending against petitioner so also Smt. Bhuvneshwari Kumari besides in the case of Late Maharao Bhim Singh and accordingly the petitioner continues to be owner of the requisitioned lands of Ummed Bhawan Palace Compound, and his rights of ownership therein are not questionable. Thus viewed, objections of the respondents are accordingly overruled.
27. As regards deductions towards TDS Income Tax on total amount of recurring compensation paid i.e. Rs. 21,49,932/-, exemption is claimed by the assessee (petitioner) by virtue of Section 10(19A) of the Income Tax Act, 1961 (for brevity IT Act), though admittedly such TDS income tax amount has already been deposited by challan with the IT Department by the Collector, Kota and the Income Tax Department is not arrayed as party respondent to this writ petition. However, I have heard this writ petition alongwith petitioner's writ petition challenging Wealth Tax assessment order claiming exemption Under Section 5(1)(iii) of the WT Act on the anology of the IT Act, in which the Income Tax Department is arrayed as respondent No. 3 albeit separate judgments are being delivered inasmuch as in the present writ petition, the Union of India is duly represented, it is not necessary to array the IT department as respondent. This leads me to a question as to whether the entire income from Ummed Bhawan Palace of the assessee (petitioner), who is the former Ruler of Kota is exempt from income tax?
28. Admittedly, under the Merged States (Taxation Concessions) Order, 1949 this palace 'Ummed Bhawan Compound' was declared to be an official residence of Ex-ruler of Kota. Section 10(19A) of the Income Tax Act, as amended by the Rulers of Indian States (Abolition of Privileges) Act, 1972, reads as under :-
'(19A) The annual value of any one palace in occupation of a Ruler, being a palace, the annual value whereof was exempt from income tax before the commencement of the Constitution (Twenty- sixth Amendment) Act, 1971, by virtue of the provisions of the Merged States (Taxation Concessions) Order, 1949, or the Part-B States (Taxation Concessions) Order, 1950, or, as the case may be, the Jammu & Kashmir (Taxation Concessions) Order, 1958:
Provided that for the assessment year commencing on the 1st day of April 1, 1972, the annual value of every such palace in the occupation of such Ruler during the relevant previous year shall be exempt from income tax.'
29. A similar controversy had arisen in CIT Bharatchandra Banjdeo (2) wherein the Division Bench of the M.P. High Court (consisting of G.L.Oza CJ & B.M. Lal, J., as they then were) while distinguishing the decision of Delhi High Court in Mohd. Ali Khan v. CIT (3) held as under:-
'Under the Merged States (Taxation Concessions) Order, 1949, all buildings and palaces declared to be official residence of a Ruler were exempt from tax and in some of the States when one Building or palace was declared as official residence, it was exempt from tax. Clause (19A) to Section 10 of the IT Act, 1961, was incorporated by the Rulers of Indian States (Abolition of Privileges) Act, 1972, with effect from December 28, 1971, and from the language of Clause (19A), it is clear that the exemption which was available for a number of palaces declared to be official residence under the Merged States (Taxation Concessions) Order, 1949, was limited to only one palace in the occupation of a Ruler. The significant words in Clause (19A) are 'one palace in the occupation of a Ruler' and further that it should be a palace which under the Merged States (Taxation Concessions) Order, 1949 was declared to be official residence of a Ruler. Clause (19A) does not contemplate further spliting up of portions of a palace into residential and let out portions. Therefore, even if only a part of a palace is in the occupation of a Ruler and the rest has been let out the exemption will be available for the entire palace.'
30. Thus having benefited by the enlightenments derived from afore quoted principles, I am of the opinion that Section 10(19A) could not be interpreted to mean that it contemplates further splitting up of portions of a palace inasmuch as the language of Section 10(19A) of the IT Act does not justify it.
31. However, as per language of Sub-section (19A), ibid, it is crystal that the exemption which was available for a number of palaces (declared as 'official residence' under the Merged States (Taxation Concession) Order, 1949) was limited to only one palace in occupation. Undisputably the property in question is a palace not only renown as Ummed Bhawan Palace but also declared as 'official residence' of Ex-ruler - father of the petitioner. Even while following the decision in CIT v. Bharatchandra Banjdeo (supra) this Court (D.B. consisting of J.S. Verma, CJ & I.S. Israni, J, as they then were) dealing with selfsame Ummed Bhawan Palace's matter as to the exemption claimed by the petitioner's father Maharao Bhim Singh under Section 10(19A) of the IT Act for the assessment years 1973-74, 1974-75, 1975-76, 1976-77 & 1977-78 in CIT v. Maharao Bhim Singh (4) held as under:-
'So far as the first question relating to exemption claimed under Section 10(19A) is concerned, there is a direct decision in CIT v. Bharatchandra Banjdeo : [1985]154ITR236(MP) It was held therein that it is not possible to split up one palace into parts for granting exemption only to that part in self occupation of the ex-Rulers as his official residence and to deny the benefit of exemption to the other portion of the palace rented out by the Ruler, since the entire palace is declared as his official residence. Accordingly it was held that even if only a part of the palace is in the self occupation of the former Ruler and the rest has been let out, the exemption available under Section 10(19A) will be available to the entire palace. No decision taking a contrary view has been cited before us. We do not find any good ground to depart from that view, when the view taken in that decision is undoubtedly a plausible view. In the case of a taxing statute, a plausible view in favour of the assessee should be preferred in these circumstances. Following that decision the first question has to be answered against the Revenue and in favour of the assessee.'
32. The benefit of exemption while following aforequoted dictum of law was also extended in successive assessment years (1979-80, 1980-81, 1981-82, 1982-83 & 1983-84) for the selfsame Ummed Bhawan Palace - Official residence as declared under the Merged States (Taxation Concessions) Order, 1949, by this Court in DB IT Reference Application Nos. 51/89, 52/89, 53/89, 84/89 which have been decided recently on October 10,2001 by the Division Bench consisting of Rajesh Balia, J. & myself, on the same anology i.e. even if only a part of the palace is in the self occupation of the former Ruler and the rest has been let out, the exemption available under Section 10(19A) will be available to the entire palace,
33. As a result of the above discussion, this writ petition is allowed with no order as to costs. A writ of certiorari and mandamus is issued in favour of the petitioner for (1) quashing & setting aside an order dated 26.12.96 (Ann.22); (2) holding (a) survey done by the defence authority and (b) declaration of land being short fall area & Sawai Chak, as void and unconstitutional; and (3) for directing the respondents to (i) refund a sum of Rs. 14,13,127/- (already deducted) plus Rs. 1,50,330/- (deposited by him) and (ii) to pay admitted recurring compensation amount without any deduction in respect of a requisitioned land situated at Umaid Bhawan Palace Kola recognised as official residence of the petitioner in the light of the sanction of the President of India and continue to pay at the rates enhanced from time to time as envisaged in the sanction till the date of acquisition/derequisition for aforesaid 918.26 acres without any deduction on any account either of short fall or TDS income tax. The respondents are further directed to refund TDS Income Tax to the tune of Rs. 21,49,932/- (admittedly deposited by the Collector Kota on 28.9.96 (Ann.20F)) in favour of the petitioner. Compliance of aforesaid directions be made within two months from today.