The Supreme Court has ruled that the Government cannot resort to summary proceedings for eviction where a bona fide dispute over the title to land subsists, especially when the dispute concerns possession and ownership dating back several decades. The judgment was delivered by a bench comprising Justice J.B. Pardiwala and Justice K. Vinod Chandran in the matter of M/s Circar Paper Mills Ltd. v. District Collector, Nellore Distt. & Ors., arising under the Andhra Pradesh Assigned Land (Prohibition of Transfers) Act, 1977.
The dispute centred on 40.65 acres of land in Nellore district, which the Andhra Pradesh Government claimed were assigned lands and therefore not alienable. However, the land had been in continuous private possession since 1920 and was subsequently inherited by B.J. Rao, who sold various portions, including 46.23 acres to Circar Paper Mills in 1980. Following the liquidation of Circar Paper Mills, the Official Liquidator took possession of the property in 2001 and, with the permission of the Company Court, put it up for public auction. J.K. Sugar Mills Ltd. emerged as the successful bidder for Rs 7.80 crore.
At the auction stage, the Government objected, asserting that 40.65 acres constituted government-assigned land. The Company Court confirmed the sale, subject to payment to the Government. However, the High Court's appellate wing later set aside the auction confirmation, prompting the appeal before the Supreme Court.
Setting aside the impugned decision of the appellate court, the Supreme Court held that summary eviction jurisdiction cannot be used as a substitute for the adjudication of a serious and bona fide title dispute. The bench, in its judgment authored by Justice Chandran, observed that the landlords claimed title based on registered deeds and mutation entries carried out in accordance with sale deeds. The Court noted that the Government could not plead ignorance of the sanctions, permissions, or mutation entries that had been effected over the years.
The judgment further stated that the acquisition of the properties by the Government for APIIC clearly indicated that ownership of at least the said property resided with private individuals. It was also noted that the company in liquidation had purchased adjacent properties from owners whose title was similarly asserted on the basis of registered sale deeds and mutation entries.
The Court emphasized that long possession itself restrained it from accepting any summary proceedings for eviction. It recalled its 1982 judgment in Government of Andhra Pradesh v. Thummala Krishna Rao and Another, where a similar dispute over title had arisen between the State Government and private parties concerning three plots of land, including an allegation of Nawab's encroachment. In that case, the Court had held that whether the title vested in the Government due to acquisition, and whether the Nawab had perfected title by adverse possession thereafter, were questions requiring determination in a properly constituted suit, and that no summary eviction could precede such resolution.
Relying on that precedent, the Supreme Court concluded that the Respondent-Government's claim of title involved a genuine and longstanding dispute that could not be resolved through summary eviction proceedings, particularly in the absence of sufficient material to substantiate its claim. Consequently, the appeal was allowed, and the auction proceedings were directed to be restored.