IN CA 4049-4053 OF 2023- SC- Supreme Court dismisses appeals pertaining to land dispute among legal heirs of erstwhile royal family, holds that under CPC provisions executing Court cannot decide questions of title set up by third parties who assert independent title in themselves
Justice V. Ramasubramanian and Justice Pankaj Mithal [15-06-2023]

Read Order: M/s Trinity Infraventures Limited v M.s. Murthy

Simran Singh

New Delhi, June 16, 2023: The Supreme Court, in a detailed judgement authored by Justice V. Ramasubramanian, dismissed a batch of appeals in a matter pertaining to the long-pending tussle over distribution of land and properties among the legal heirs of the Paigah family which held a significant portion of properties in Hyderabad during the Nizam era.

In the matter at hand, the petitioner was aggrieved by a common judgment rendered by the Division Bench of the Telangana High Court in a batch of intra-Court appeals, confirming the judgment of the Single Judge of the High Court in a batch of applications in a civil suit.

The Nizam or ruler of Hyderabad prior to the year 18.09.1948 had the practice of granting certain lands to people for the purpose of supply and maintenance of Armed Forces. The said land was called as ‘Paigah Estate’ which the present issue on hand relates to. The said Paigah was granted to a person by name Khurshid Jah and the grant came to be known as Khurshid Jah Paigah. A special feature of the Paigah was that a single person who was granted the possession of the said land was entitled  in respect of the management, a specific share in the income of the estate and this right was called Haqe Inthezam or right of management.

The holder of the Paigah was called Amir and the heirs of the original grantees were entitled to their respective shares in the revenue, by inheritance, deducting the share of the Amir and also the administrative expenses. This share was previously un-ascertained and that was the reason why until the death of Sir Khurshid Jah and the other respective holders of the Paigah, the Amirs were practically the only persons to be considered and they could take for themselves what part of the income they thought fit.

In order to remedy the injustice caused by such arbitrary and capricious way of appropriation of the income, several committees came up with proposals. Sir Khurshid Jah died on Rabi-al-Thani, 1320 H (July, 1902) leaving behind him surviving, two sons, by name Imam Jung and Zafar Jung as his only recognised legitimate heirs. Any grant of Jagir, on the death of the grantee would lapse to the Crown and a fresh grant could be made to any of the heirs of the previous grantee.

On the death of Sir Khursid Jah, no Amir was appointed by the Nizam in relation to that Paigah until 1345 H (February, 1927) and no member of the family was put in complete charge of the Paigah. Nawab Zafar Jung, under a Farman was put in charge of the Khurshid Jahi Paigah as a mere supervisor and trustee to carry on the ordinary routine work and was directed to take the Nizam’s orders on all important matters and to account for the income and expenditure of the estate.

Eventually over the years, the political atmosphere changed and the Jagirs and the Paigahs were abolished by means of the Jagir Abolition Regulations (Hyderabad Regulation No. 69 of 1358 F) with effect from 15.08.1949. The Jagirs and the properties connected with the Jagirs were taken over by the Jagir Administrator and the Jagirdars were declared entitled only to the commutation amount. The other properties and estates unconnected with the Jagirs, however, were allowed to remain with the Jagirdars.

In the year 1955-56, a lady by name Dildar-Un-Nissa Begum, who was one of the lineal descendants of Khurshid Jah filed a suit on the file of the City Civil Court, Hyderabad, claiming

(i) that the Estate left behind by Nawab Khurshid Jah was a Mathruka Estate; and

(ii) that she is entitled to 29/2944 share.

In the year 1961, some of the parties to the suit entered into a compromise and filed an application in under Order XXIII Rule 3 Code of Civil Procedure, 1908 for recording the compromise and passing a preliminary decree. The High Court Judge, sitting as a Trial Judge  passed a judgmenton 28.06.1963, both in the suit and in the application under Order XXIII Rule 3 CPC. The operative part of the judgment which contained the decree intended to be passed, comprised of two portions, one relating to the defendants who were not parties to the compromise and the other relating to those who were parties to the compromise.

The Division Bench of the High Court held that the appellants had failed to establish that the land in Hydernagar village is Mathruka property of Khurshid Jah Paigah and that the preliminary decree dated 28.06.1963 as regards the lands in Hydernagar village was vitiated by fraud and further the order obtained in an application was also vitiated by fraud and hence could not be executed against the claim petitioners and third parties.  The appellants herein challenged the common order dated 20.12.2019 passed by the Division Bench of the High Court for the State of Telangana.

The issue for consideration:

1. Whether the Division Bench of the High Court was right in declaring that the preliminary decree dated 28.06.1963 was vitiated by fraud and consequently null and void, especially when there was no pleading and no evidence let in?
2.  Whether the concurrent findings of the Single Judge and the Division Bench of the High Court that Khurshid Jah did not leave behind any Mathruka property, goes contrary to the finding recorded in the Judgment and preliminary decree that had attained finality?
3. Whether the finding recorded in the judgment and preliminary decree that the lands in Hydernagar are Mathruka property was binding upon third parties?
4.  What was the scope of the enquiry under Order XXI Rules 97- 101, CPC ?
5. Whether the claims of the claim petitioners stood established? and
6. Whether the State of Telangana had any legitimate claim and whether any such claim would still survive after a series of setbacks to the State Government in the Court room?

Court Findings and Analysis

While dealing with issue 1 and 4 the Bench agreed with the contention of the assignees of decrees that no one pleaded that the preliminary decree was vitiated by fraud. Allegations of fraud, as rightly contended, required special pleadings in terms of Order VI, Rule 4 CPC. The Bench noted that the fraud was not one of the issues framed nor was there any finding recorded by the Single Judge about fraud but the Division Bench read such a finding into the order of the Single Judge.

The Court stated that in the present case, the obstructionists did not claim title under any one of the parties to the litigation but set up independent title in themselves. “What was filed by Dildar-Un-Nissa Begum was only a suit for partition. In a suit for partition, the Civil Court cannot go into the question of title, unless the same is incidental to the fundamental premise of the claim.”

The Bench was of the view that the preliminary decree dated 28.06.1963 could not have determined the claim to title made by the legal heirs seeking partition, as against third parties. “Any finding rendered in the preliminary decree, that the properties were Mathruka properties liable to be partitioned, was only incidental to the claim of the legal heirs and such a finding will not be determinative of their title to property as against third parties.”

The Bench stated that the manner in which the judgment and preliminary decree dated 28.06.1963 were sought to be used, abused and misused by parties to the proceedings as well as non-parties who jumped into the fray by purchasing portions of the preliminary decree and seeking to execute them through Court, defeating the rights of third parties, was what prompted the Division Bench of the High Court to hold that the preliminary decree was vitiated by fraud.

“…even symbolic possession of the land in Survey No. 172 was not possible in the year 1974, but actual possession became possible in the year 1996 after the decrees were sold by way of assignments. We do not know what magic was played by Goldstone, like a philosopher’s stone16, to make this miracle possible.” Observed the Bench

The Bench while answering issue 1 stated that the judgment and preliminary decree dated 28.06.1963, though may not be vitiated by fraud, were certainly not binding upon third parties like the claim petitioners as well as the Government who had set up independent claims and that whatever was done in pursuance of the preliminary decree was an abuse of the process of law. Further, an enquiry under Order XXI, Rules 97 to 101, CPC, it was held that the Executing Court could not decide questions of title set up by third parties (not claiming through or under the parties to the suit or their family members), who assert independent title in themselves. “All that can be done in such cases at the stage of execution, is to find out prima facie whether the obstructionists/claim petitioners have a bona fide claim to title, independent of the rights of the parties to the partition suit. If they are found to have an independent claim to title, then the holder of the decree for partition cannot be allowed to defeat the rights of third parties in these proceedings.”

While navigating through issue 2 and 3 the Bench stated that they had already stated that any finding relating to title to a property, recorded in a simple suit for partition could not be binding on third parties but the same would hold good even in relation to the findings in the preliminary decree that most of the suit schedule properties were Mathruka properties. It was held that no finding was ever recorded by the Trial Judge in his judgment dated 28.06.1963 that the properties left behind by Khurshid Jah were Mahtruka properties. Therefore, the contention as though there was such a finding and that the finding had attained finality and that the impugned Judgment goes contrary to such a finding, was wholly misconceived.

It was held that the Single Judge as well as the Division Bench (in the impugned judgment) were right in holding that the properties were not established to be Mathruka properties. The effect of the order of the Nazim Atiyat was not examined by the Trial Judge. “In any case, such an examination had to be done independently and not in a partition suit, keeping in view, the 1955 Act and various subsequent enactments relating to agricultural land reforms and urban land ceiling.”

The Bench while dealing with issue 5, did not agree with the appellant that the claim petitioners (obstructionists to the execution) could not produce a single scrap of paper to show how they derived the title to the portions of land in Hydernagar. It was held that the predecessors of the appellants have had knowledge that faisal patti were recorded in the name of the claim petitioners in 1978 itself. “Even the Receiver was aware of this, as seen from the letter written by the Receiver on 09.04.1980 to the Collector. Yet the Receiver informed the Court that possession of the land in Survey No.172 could be granted to defendant Nos.157 and 206. The report of the Receiver-cum-Commissioner in this regard and the order passed thereon by the Court dated 20.01.1984 for handing over possession, is shocking, in the light of the fact that the Receiver himself recorded in his letter dated 09.04.1980 that faisal patti stood in the name of the claim petitioners. Therefore, it is too late in the day for the appellants to question as to how the claim of the claim petitioners stood established. We accordingly answer this issue No. (v) in favour of the claim petitioners.”

The Bench while dealing with issue 6 stated that it was not deciding the title to land in these proceedings. Therefore, the finding recorded in paragraph 244 and the conclusion reached in paragraph 414(d) of the impugned judgment, was not binding on the State Government.

The Bench while answering the question in relation to the appeals by persons whose impleadment applications were dismissed by the High Court, but whose cases were similar to that of the claim petitioners stated that those persons who have identical claim as the obstructionists and who had filed independent appeals against the impugned judgment would have the benefit of the judgment. “But the benefit of this judgment will not inure to (i) those third parties claiming title under any of the parties to CS No.14 of 1958 and (ii) those claiming to have decrees or assignment of decrees in CS No. 14 of 1958.”