Flour Mill’s Challenge To ₹83,349.30 Market-Fee Demand From 1969–70 Fails As P&H HC Applies Punjab Land Revenue Act’s Civil-Court Bar

The appellant, a private limited company operating a flour mill, challenged a demand of ₹83,349.30 for market fee said to be outstanding for 1969–70.

It argued that recovery was belated, included unlawful interest, and had been initiated without an opportunity to inspect the relevant records; it also relied on a change in the mill’s management.

The respondents maintained that the amount was recoverable as arrears of land revenue, that the company remained the same legal entity, and that the Civil Court’s jurisdiction was barred.

The appellant had earlier challenged the demand in CWP No. 2193 of 1970, dismissed on 31 July 1981.

The trial Court dismissed the suit for want of Civil Court jurisdiction, and the first appellate Court upheld that conclusion.

The appellant brought this Regular Second Appeal against the appellate decree dated 18 April 2012.

Section 158(2)(xiv) of the Punjab Land Revenue Act, 1887 excludes Civil Court jurisdiction over claims connected with, or arising out of, the Government’s collection or enforcement of recovery of land revenue or sums recoverable as arrears of land revenue.

In Kamala Mills Ltd. v. State of Bombay, AIR 1965 SC 1942, the Supreme Court held that whether Civil Court jurisdiction is excluded expressly or by necessary implication must be assessed by considering the statutory language, scheme, object, and purpose; where exclusion is express, the adequacy of the alternative remedy is relevant but not decisive.

The Court also applied the principle of constructive res judicata to the appellant’s attempt to re-agitate the demand after its earlier writ petition had been dismissed.

The Court found that the suit sought to invalidate a demand being enforced as recoverable arrears of land revenue.

The claim therefore fell within Section 158(2)(xiv), barring the Civil Court from entertaining it.

The earlier writ petition concerned the same cause of action, and its dismissal supported the conclusion that the appellant could not re-agitate the demand through a civil suit.

The Court further held that the deposits did not assist the appellant because it had not shown that they were made under protest or pursuant to a competent Court’s order; in any event, the earlier dismissal meant no cause of action survived.

A change in management did not extinguish the liability, which was against the company itself and not its management.

The appellant identified no error in the concurrent findings warranting interference in the second appeal.

The Regular Second Appeal was dismissed.