Full Judgment Text
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CASE NO.:
Appeal (civil) 2501 of 2002
PETITIONER:
Union of India & Another
RESPONDENT:
Raja Mohammed Amir Mohammad Khan
DATE OF JUDGMENT: 21/10/2005
BENCH:
ASHOK BHAN & ALTAMAS KABIR
JUDGMENT:
J U D G M E N T
BHAN, J.
Union of India has filed this appeal by leave
of the Court against the final judgment/order dated
21.9.2001 passed by the High Court of Judicature at
Bombay in Writ Petition No.1524 of 1997 whereby the
High Court has allowed the writ petition filed by
the respondent. High Court has further directed
the return of the property to the respondent.
In order to appreciate the controversy arising
in this appeal the facts are required to be set in
detail.
Raja Mohammed Amir Mohammad Khan, writ
petitioner/respondent herein is the son of Raja of
Mahmudabad in Distt. Sitapur Uttar Pradesh. In
December, 1957 the erstwhile Raja of Mahmudabad
(father of the respondent) migrated to Pakistan and
became a citizen of Pakistan. However, the
respondent and his mother Rani Kaniz Abdi (since
deceased) continued to reside in India as Indian
citizen.
The Defence of India Rules, 1962 made under
Section 3 of the Defence of India Ordinance, 1962
came into force with effect from 5.11.1962. Rule
133-V, inter alia, provided that the Central
Government was authorised to appoint a Custodian of
Enemy Property for India to preserve enemy
property. Defence of India Ordinance, 1962 was
repealed by Section 48 of Defence of India Act,
1962. The 1962 Rules, however, made under the
Defence of India Ordinance, 1962 were deemed to be
the rules under the Defence of India Act.
Thereafter, the Government of India in exercise of
powers under sub-rule (1) of Rule 133-V issued the
Enemy Property (Custody & Registration) Order,
1962. In the year 1965 hostilities between India
and Pakistan broke out and on 11.9.1965 the Enemy
Property (Custody & Registration) Order, 1965 (for
short "the Enemy Property Order, 1965") was issued
by the Government of India. The effect of the
order was that all immovable property in India
belonging to or held by or managed on behalf of
Pakistani nationals stood vested in the Custodian
of Enemy Property in India with immediate effect.
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Since the father of the respondent was a national
of Pakistan his property also vested in the
Custodian. Enemy Property Ordinance, 1968 was
promulgated which was later on replaced by the
Enemy Property Act on 6.7.1968. Enemy Property
vested in the Custodian under the Defence of India
Rules, 1962, continued to be vested in the
custodian under the said Act.
The erstwhile Raja of Mahmudabad died in London
on 14.10.1973. The respondent herein is the sole
heir of late Raja by virtue of Section 22 of Oudh
Estates Act, 1869 as also by virtue of custom and
usage of the respondent family. Respondent made
numerous representations, including the one dated
18.5.1979 requesting the Union of India as well as
the custodian to release the property as the same
could not continue to vest with the Custodian after
the death of respondent’s father and having vested
in him, as an Indian citizen. Director Vigilance,
Ministry of Commerce wrote to the respondent on
7.3.1981 inter alia, informing him that the
question of release had been taken up by the
Cabinet and the Cabinet had decided to release 25%
of the said property in favour of the legal heirs
and successors of the respondent’s father. Another
communication dated 24.9.1981 was received by the
respondent from the Director Vigilance, Ministry of
Commerce of Union of India informing him that they
would release 25% of the property to the legal
heirs of the father of the respondent who had
always been Indian citizens. Respondent was
requested to contact Custodian of Enemy Property
for India and complete the necessary procedural and
legal formalities. Thereafter, on 10.10.1981
Custodian of Enemy Property wrote a letter to the
respondent asking for legal evidence regarding the
heirs and successors of respondent’s father to
enable him to release the properties to the extent
of 25%.
Respondent filed a suit being Suit No.365 of
1981 in the Court of Civil Judge, Lucknow on
18.11.1981 seeking a declaration that he was the
sole heir and successor of the deceased Raja of
Mahmudabad. This suit was dismissed on 26.3.1984
for non-joinder of the Custodian of Enemy Property
(hereinafter referred to as "Appellant No.2") as a
party respondent. In July, 1984 respondent filed a
second suit being Suit No.219 of 1984 in the Court
of Civil Judge, Lucknow, inter alia, contending
that by virtue of taking over the property the
title of the property did not vest in the
custodian. The vesting was limited for the
purposes of taking over of the possession,
management and control of the enemy property till
such time the property remained the enemy property.
It was, inter alia, prayed that he be declared the
sole heir and successor of his father and thereby
entitled to 25% of the properties and to such other
percentage or the whole of the said properties.
Appellant No.2 filed the written statement
contesting the suit inter alia contending that the
suit property had vested in the Custodian free from
all encumbrances and denied that it had vested in
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the Custodian for the purpose of management only.
It was denied that the respondent was the heir of
late Raja of Mahmudabad. Trial Court decreed the
suit on 8.7.1986. It was declared that the
respondent was the sole heir and successor of his
father and thereby entitled to 25% or whatever
percentage it may be of the property in the suit.
The suit was decreed in the following terms:-
"The suit of the plaintiff for
declaration is decreed with costs
against the defendants and it is
hereby declared that the
plaintiff is the sole heir and
successor of his father late Raja
Mohammad Amir Ahmad Khan and
thereby he is entitled to the 25%
or whatever percentage it may be,
of the properties in suit,
described in Schedule \026 I of the
plaint, which are going to be
released in favour of the heir of
late Raja Mohammad Amir Ahmad
Khan under the decision of the
Government of India, as alleged."
The aforesaid judgment became final, conclusive
and binding as the appellants did not prefer an
appeal against the same.
Since despite protracted correspondence over
several years, the petitioner No.2 failed to hand
over the properties to the respondent, the
respondent filed Writ Petition No.1524 of 1997 in
the High Court of Judicature at Bombay praying,
inter alia, for a declaration that the properties
vested with the Custodian ceased to be enemy
property and stood divested from appellant No.2
with effect from 14.10.1973 and that the possession
of the Custodian was illegal and without authority
of law.
By the impugned judgment the High Court has
allowed the writ petition and held that on an
interpretation of Sections 6, 8 and 18 of the Enemy
Property Act, due to vesting of the property in the
Custodian, the owner is not divested of his right,
title and interest in the property as under the Act
title does not come to vest in the Custodian. The
vesting is limited to the temporary taking over of
the possession, management and control over the
property only. It was conceded before the High
Court by the counsel appearing for the appellants
that respondent who was an Indian citizen was the
heir and successor of his late father Raja of
Mahmudabad. It was held that the properties were
no longer enemy properties as the title of the same
now vested in an Indian citizen. The High Court
accordingly directed appellant No.2 to handover
possession of the properties, actual or juridical,
as the case may be, to the respondent within three
months from the date of passing of the order.
Respondent’s prayer for mesne profits and
compensation in respect of the properties in
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question were rejected.
Counsel for the parties have been heard at
length.
The Enemy Property Act, 1968 was enacted for
purpose of continued vesting of enemy property,
vested in the Custodian of Enemy Property for India
under the Defence of India Rules, 1962 and the
Defence of India Rules, 1971. Section 2(b) defines
enemy, an enemy subject or an enemy firm and the
same reads as under:-
"2(b) \026 "enemy" or "enemy
subject" or "enemy firm" means a
person or country who or which
was an enemy, an enemy subject or
an enemy firm, as the case may
be, under Defence of India Act,
1962 and the Defence of India
Rules, 1962 [or to the Defence of
India Act, 1971 and the Defence
of India Rules, 1971], but does
not include a citizen of India;"
Section 2(c) defines the expression "enemy
property" as follows:-
"2 (c) \026 "enemy property" means
any property for the time being
belonging to or held or managed
on behalf of an enemy, an enemy
subject or an enemy firm;
Provided that where an individual
enemy subject dies in the
territories to which this Act
extends, any property which
immediately before his death,
belonged to or was held by him or
was managed on his behalf, may,
notwithstanding his death,
continue to be regarded as enemy
property for the purposes of this
Act;"
Section 6 of the Act provides or declaring the
transfer of property by enemy subject which is
vested in the Custodian to be void by the Central
Government after giving reasonable opportunity of
being heard. Section 6 reads as under:-
"6. Transfer of property vested
in Custodian by enemy or enemy
subject or enemy firm \026 Where any
property vested in the Custodian
under this Act has been
transferred, whether before or
after the commencement of this
Act, by an enemy, or an enemy
subject or an enemy firm and
where it appears to the Central
Government that such transfer is
injurious to the public interest
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or was made with a view to
evading or defeating the vesting
of the property in the Custodian,
then, the Central Government may,
after giving a reasonable
opportunity to the transferee to
be heard in the matter, by order,
declare such transfer to be void
and on the making of such order,
the property shall continue to
vest or be deemed to vest in the
Custodian."
This section provides that if any property
vested in the Custodian has been transferred,
whether before or after the commencement of the
Enemy Property Act, by an enemy, or an enemy
subject or an enemy firm and if the Central
Government is of the opinion that such transfer is
injurious to the public interest or was made with a
view to evading or defeating the vesting of the
property in the Custodian, the Central Government
may declare such transfer to be void after hearing
the transferee in the matter. This provision makes
it clear that there is no bar on the transfer of
the enemy property in general by an enemy subject
meaning thereby the title still remains with him.
Section 8 deals with power of Custodian in
respect of the enemy property vested in him. The
same is reproduced here:-
"8. Powers of Custodian in
respect of enemy property vested
in him \026 (1) With respect to the
property vested in the Custodian
under this Act, the Custodian may
take or authorise the taking of
such measures as he considers
necessary or expedient for
preserving such property and
where such property belongs to an
individual enemy subject, may
incur such expenditure out of the
property as he considers
necessary or expedient for the
maintenance of that individual or
of his family in India.
(2) Without prejudice to the
generality of the foregoing
provision, the Custodian or such
person as may be specifically
authorised by him in this behalf,
may, for the said purpose, ---
(i) carry on the business of the
enemy;
(ii) take action for recovering
any money due to the enemy;
(iii) make any contract and
execute any document in the name
and on behalf of the enemy;
(iv) institute, defend or continue
any suit or other legal
proceeding, refer any dispute to
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arbitration and compromise any
debts, claims or liabilities;
(v) raise on the security of the
property such loans as may be
necessary;
(vi) incur out of the property
any expenditure including the
payment of any taxes, duties,
cesses and rates to Government or
to any local authority and of any
wages, salaries, pensions,
provident fund contributions to,
or in respect of, any employee of
the enemy and the repayment of
any debts due by the enemy to
persons other than enemies.
(vii) transfer by way of sale,
mortgage or lease or otherwise
dispose of any of the properties;
(viii) invest any moneys held by
him on behalf of enemies for the
purchase of Treasury Bills or
such other Government securities
as may be approved by the Central
Government for the purpose.
(ix) make payments to the enemy
and his dependents;
(x) make payments on behalf of
the enemy to persons other than
those who are enemies, of dues
outstanding on the 25th October,
1962 (or on the 3rd December,
1971); and
(xi) make such other payments out
of the funds of the enemy as may
be directed by the Central
Government.
Explanation \026 In this sub-section
and in sections 10 and 17,
"enemy" includes an enemy subject
and an enemy firm."
Section 9 provides that all enemy property
vested in the Custodian shall be exempt from
attachment, seizure or sale in execution of decree
of a civil court or orders of any other authority.
Section 13 makes provision for validity of
action taken in pursuance of orders of Custodian
and reads as under:-
"13. Validity of action taken in
pursuance of orders of Custodian
\026 Where under this Act, --
(a) any money is paid to the
Custodian; or
(b) any property is vested in the
Custodian or an order is
given to any person by the
Custodian in relation to any
property which appears to the
Custodian to be enemy
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property vested in him under
this Act, neither the
payment, vesting nor order of
the Custodian nor any
proceedings in consequence
thereof shall be invalidated
or affected by reason only
that at a material time, --
(i) some person who was or
might have been
interested in the money
or property, and who
was an enemy or an
enemy firm, had died or
had ceased to be an
enemy or an enemy firm;
or
(ii) some person who was so
interested and who was
believed by the
Custodian to be an
enemy or an enemy firm,
was not an enemy or an
enemy firm."
Section 18 deals with divesting of enemy
property vested in the Custodian and reads as
under:-
"18. Divesting of enemy property
vested in the Custodian \026 The
Central Government may, by
general or special order, direct
that any enemy property vested in
the Custodian under this Act and
remaining with him shall be
divested from him and be
returned, in such manner as may
be prescribed, to the owner
thereof or to such other person
as may be specified in the
direction and thereupon such
property shall cease to vest in
the Custodian and shall revest in
such owner or other person."
A reading of Section 18 makes it evident that
enemy property is not permanently vested in the
Custodian and divesting the custodian of such
property is contemplated.
Section 19 protects the action taken under the
Act and provides that no suit, prosecution or other
legal proceeding shall lie against the Central
Government or the Custodian or enemy property for
anything which is done in good faith or intended to
be done under the Act.
The High Court of Calcutta in Sudhendu Nath
Banerjee and others Vs. Bhupati Charan Chakraborty
and others, 1976 Calcutta 267, held that on a
reading of Section 6, 8, and 18 of the Act, the
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enemy, due to vesting of his property in the
Custodian is not divested of all his right, title
and interest in the property, but the vesting in
the Custodian is limited to the extent of
possession, management and control over the
property temporarily. In Mumtaz Begum Vs. Union of
India and Others, AIR 1991 Calcutta 241 the High
Court reiterated its earlier view. In this case
the High Court was seized of a matter in respect of
enemy property which had vested in the Custodian.
After adjudication of title in his favour the
appellant filed a writ petition in the High Court
claiming the property as it no longer belonged to
an enemy subject. The Single Judge dismissed the
writ petition. The Division Bench reversing the
order of the Single Judge took the view that the
appellant therein was entitled to get the property
back as it no longer belonged to an enemy subject.
That the title of the property does not vest in the
Custodian and the Custodian takes over the property
under the Act temporarily for its management and
control. The High Court in the impugned judgment
has followed the said Rule.
The enemy, an enemy subject or enemy firm under
Section 2(b) means a person or country who or which
was an enemy, an enemy subject or enemy firm, as
the case may be under the Defence of India Act,
1962 and the Rules made thereunder or to the
Defence of India Act, 1971 and the Rules made
thereunder but does not include a citizen of India.
Enemy property under the Act means any property
belonging to or held or managed or on behalf of an
enemy, enemy subject or enemy firm for the time
being. Proviso to Section 2(c) provides that where
an individual enemy subject dies within the
territories to which Enemy Property Act extends,
any property which immediately before his death
belonged to or held by him or managed on his behalf
may continue to be regarded as enemy property for
the purposes of Enemy Property Act notwithstanding
his death.
A conjoint reading of Sections 6, 8 and 18 of
the Act, indicates that the enemy subject due to
the vesting of his property in custodian is not
divested of his right, title and interest in the
property. The vesting in the Custodian is limited
to the extent of possession, management and control
over the property temporarily. This position was
not disputed before us by the learned counsel
appearing for the appellant. The object of the
Enemy Property Act is to prevent a subject of an
enemy state from carrying on business and trading
in the property situated in India. It is,
therefore, contemplated that temporary vesting of
the property takes place in the Custodian so that
the property till such time as it is enemy property
cannot be used for such purpose.
The question that falls for determination is
whether the properties in question after its
inheritance by the respondent who is a citizen of
India can be said to be enemy property.
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It is not in dispute that respondent was born
in India and is an Indian citizen. His late father
migrated to Pakistan in the year 1957 and become a
citizen of Pakistan. After the breaking of the
hostilities between India and Pakistan in the year
1965 the property of his father located in India
got vested in the Custodian. After the coming into
force of the Enemy Property Act in the year 1968
the properties of late Raja continued to be vested
with the Custodian till he died on 14.10.1973 in
London. After the death of his father respondent
who is a citizen of India inherited the property
being the sole heir and successor of his father.
Can he be termed as enemy or enemy subject within
the meaning of Section 2(b) or can the property of
an Indian citizen be termed as enemy property
within the meaning of Section 2 (c)? Answer is
emphatic No. The definition of enemy provided
under Section 2(b) excludes citizens of India as an
enemy, or enemy subject or enemy firm. Under the
circumstances, the respondent who was born in India
and his Indian citizenship not being in question
cannot by any stretch of imagination be held to be
enemy or enemy subject under Section 2(b).
Similarly, under Section 2(c) the property
belonging to an Indian could not be termed as an
enemy property.
After the death of his father the respondent
had filed a Suit No.219 of 1984 seeking a
declaration that he was the sole heir and successor
of his father. The appellants were defendants in
the said suit. The suit was decreed on 8.7.1986.
The said judgment and decree having attained
finality there remains no dispute that the
respondent is the sole legal heir and successor of
his father, the late Raja of Mahmudabad and
properties belonging to late Raja came to be owned
exclusively by him. After the death of late Raja
of Mahmudabad the respondent became the sole owner
of the properties which had been taken over by the
Custodian of Enemy Property. Having acquired the
title by way of succession the properties in
question could not be said to be enemy property
within the meaning of Section 2(c) because enemy
property means the property belonging to or held or
managed on behalf of the enemy or enemy subject or
enemy firm. Since the respondent was not an enemy
within the meaning of Section 2(b), the properties
owned, held and belonging to him cannot be held to
be the enemy properties under the Enemy Property
Act.
As indicated above, the vesting of the
properties in the Custodian under the Enemy
Property Act is limited to the extent of
possession, management and control over the
properties only. The right, title or interest of
the owner is not taken away. After the ceasing of
the property to be enemy property it ceased to be
belonging to an enemy. The Custodian cannot be
permitted to continue with the possession of such
properties. The property which initially vested in
the Custodian under the Defence of India Rules and
thereafter under the Enemy Property Act ceased to
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be enemy property upon the death of respondent’s
father on 14.10.1973. In the circumstances,
property which was vested in the Custodian ceased
to be enemy property upon the death of the father
of the respondent and the Custodian could not
continue with the possession of the property.
Reliance placed by the counsel for the
appellant on Section 13 is totally misplaced.
Section 13 does not alter the aforesaid legal
position. Section 13 only provides that the
vesting of the property of the enemy or enemy
subject in the Custodian or order of Custodian or
the proceedings in consequence thereof are not
invalidated or affected by reason that at the
material time such an enemy subject had died or
ceased to be enemy. It only means that action of
vesting or the order passed by the Custodian of the
proceedings taken in consequence thereof is not
invalidated or affected on the ground that such
enemy subject had died or ceased to be enemy when
the vesting took place or the order came to be
passed by the Custodian or proceedings in
consequence thereof were taken. It does not mean
that the property can be continued to be enemy
property under the Act when the property is
succeeded to by a citizen of India. Once the
property is succeeded to by a citizen of India the
property ceases to be covered by proviso to Section
2(c). In law, the vesting in the Custodian of the
property belonging to an Indian citizen cannot be
permitted to be continued under the Enemy Property
Act as Indian citizen is excluded from being an
enemy in terms of the provisions of Section 2(b).
Counsel for the appellant laying stress on the
provisions of Section 18 contended that only the
Central Government can divest the Custodian of the
enemy property by passing a general or special
order directing that any enemy property vested in
the Custodian under the Act shall be divested from
him and be returned in such manner as may be
prescribed to the owner thereof or to such other
person as may be specified in the direction and
only thereupon such property shall cease to vest in
the Custodian and revest in such owner or such
other person. Since in the present case no such
order has been passed by the Central Government
this Court cannot divest the Custodian of the
property. We do not agree with this submission.
In the present case the respondent filed several
representations but the Central Government did not
take a decision on them for years together. In
such a situation the power of the Court is not
taken away to pass appropriate orders in a case
where the property which vested in the Custodian
ceases to be enemy property, the same having vested
in a citizen of India by way of succession after
the death of the enemy subject.
Another interesting feature which can be taken
notice of is that on a representation filed by the
respondent the appellants agreed to release 25% of
the property in favour of the respondent on
production of proof of his having succeeded to the
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property of his father. It shows that the
appellants accepted that the property could be
released in favour of the respondent provided he
had succeeded to it after the death of enemy
subject. It further shows that the property could
be released in favour of an Indian citizen provided
he had succeeded to the estate. It further shows
that the title of the enemy property does not vest
in the custodian and it had vested in the custodian
for the purposes of management, control and
possession of the properties only.
In the High Court the Union of India had taken
certain points such as delay in filing the writ
petition; that properties had been retained by the
Government of India as a matter of policy and that
the writ petition was barred by the principle of
res judicata and the principles analogous thereto
were not pressed before us. Apart from the
submission noted and dealt with by us no other
point was raised.
On 4.9.2001 the High Court directed the
appellants to place on record copy of note put up
for release of property of the respondent’s father
and the decision taken thereon by the Cabinet. The
respondents refused to place a copy of the note of
the Cabinet claiming privilege in regard to the
said document as in their opinion the public
interest required that the same should not be
disclosed. This shows the mala fide intentions of
appellants to retain the possession of huge
properties without any authority of law.
To be just and act in a just manner is writ
large in our Constitution and the laws. The
Legislature is to act in a just manner by enacting
just laws within the frame work of the
Constitution. The executive is enjoined with a
duty to act or apply the laws in a just manner and
if an individual or institution is dissatisfied
with the State action in enacting the laws or their
implementation he can approach the court seeking
redressal of his grievances.
Unfortunately a dangerous attitude resulting in
doing institution damage is developing, that the
justice is required to be done only by the Courts.
This attitude is betrayal of Constitution as well
as laws. Every and any authority working under the
statute has to discharge its duties in a just
manner otherwise people will lose faith in the
governance.
The case in hand is a typical example of such
an attitude. It is admitted by the counsel for the
appellants that under the Enemy Property Act the
title of the property of an enemy does not vest in
the Custodian. The custodian takes over the enemy
property only for the purpose of possession,
control and management. An Indian citizen is
excluded from the definition of an ’enemy’ or
’enemy subject’ under Section 2(b). Respondent was
declared to be the heir and successor of late Raja
of Mahmudabad. On being so declared the property
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which came to vest in the respondent who is a
citizen of India ceased to be an enemy property.
On a representation filed by the respondent, the
appellants recognized this fact and agreed to
release 25% of the property although he was
entitled to the whole of the property. No reasons
were given for doing so. Still worse the
appellants did not even release 25% of the
property. Again no reasons are forthcoming for
doing so. When asked by the Court to produce the
cabinet note put up before the cabinet in this
regard, the appellants refused to do so and claimed
it to be a privileged document. When admittedly
the title of the property did not come to vest in
the custodian then as soon as the title in the
property came to vest in an Indian citizen the
property ceased to be an ’enemy property’. The
authorities were duty bound to release the property
in favour of the true owner (respondent). Instead
of doing it the Union of India forced the
respondent to knock at the doors of the Court.
The authorities have deprived the respondent of the
possession and enjoyment of the properties for the
last 32 years without any justification. The
reasons for doing so as we understand is that
buildings are being occupied by the Deputy
Commissioner, Superintendent of Police and other
district officers for their residences as well as
for their offices, which they did not want to give
up. This is highly objectionable and unjust. It
needs to be deprecated.
In the light of what we have stated, we do not
find any merit in this appeal and the same is
dismissed.
The High Court had refused to grant the mesne
profits to the respondents, against the aforesaid
finding no appeal has been filed by the respondent.
Since no appeal has been filed, the appellants are
not entitled to the mesne profits till the passing
of the interim orders of status quo by this Court
on 5.4.2002. The respondent would be entitled to
the actual mesne profits by filing a suit, if so
advised, for this period. However whatever moneys
have been collected by the appellants by way of
rent or lease etc. after 5.4.2002 till the handing
over of the possession of these properties to the
respondents be deposited/disbursed to the
respondent within 8 weeks.
The appellants are directed to get the
buildings (residence or offices) vacated from such
officers and handover the possession to the
respondent within eight weeks. Similarly,
appellants are directed to handover the possession
of other properties as well. The officers who are
in occupation of the buildings for their residences
or for their offices are also directed to
immediately vacate and handover the buildings or
the properties to the Custodian to enable him to
handover the possession to the respondent in terms
of the directions given. Failure to comply with
the directions to handover the possession within 8
weeks will constitute disobedience of this order
and the appellants would be in contempt of this
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order. Respondent would be at liberty to move an
application in this Court if the above directions
are not complied with for taking appropriate action
against the appellants or their agents. Since the
appellants have retained the possession of the
properties illegally and in a high handed manner
for 32 years, the appeal is dismissed with costs
which are assessed at Rs. 5 Lacs.