IInd Term Property Law LB204 2022 PDF

LL.B. II Term Paper: LB-204 Property Law Cases Selected and Edited by Shabnam Mahlawat Neha Kavita Sneh Yadav Harleen Kaur Anjay kumar Rubina Garewal Shivani Varma...

LL.B. II Term Paper: LB-204 Property Law Cases Selected and Edited by Shabnam Mahlawat Neha Kavita Sneh Yadav Harleen Kaur Anjay kumar Rubina Garewal Shivani Varma Atma Yadav Meena Kumari Upendra Nath FACULTY OF LAW UNIVERSITY OF DELHI, DELHI- 110007 May 2022 (For private use only in the course of instruction)  ii LL.B. II Term Paper : LB - 204 - Property Law Before the advent of the British kingdom, each community in India was governed by its respective customary law in matters relating to transfer of property. With the establishment of the formal litigation system and in absence of any legislation in this area, to begin with, the English judges applied the common law of England and the rules of equity, justice and good conscience with respect to disputes relating to transfer of property. The unsuitability of these provisions to the Indian conditions; the resulting conflict and the need for clarity of rules relating to this important branch of law necessitated the enactment of legislation. Drafted in 1870, the Transfer of Property Act saw the light of the day in 1882 and provided the basic principles for transfer of both movable and immovable properties. Based primarily on the English law of ‘Real Property’, it attempted to mould these principles to suit the Indian conditions; but certain provisions of the Act remained inapplicable to Hindus and Muslims, to start with. In order to put at rest the confusion created by the conflicting decisions and extend the application of the Act in totality to Hindus, the Transfer of Property Act, 1882 was amended in 1929. However, till date, the provisions of Chapter II of the Act that are inconsistent with the Quranic laws are inapplicable to Muslims. Moreover, a separate enactment titled the ‘Sale of Goods Act, 1930’ was passed to deal with transfer of movable property by sale. The Transfer of Property Act, 1882 contains the general principles of transfer of property and detailed rules with respect to specific transfer of immovable property by sale, exchange, mortgage, lease and gift. The present course will cover a study of important terms relevant to transfer of property, meaning of ‘transfer’ under the Act, general principles relating to transfer of property and definitions and rules relating to specific transfers of immovable properties by mortgage, lease and gift. Prescribed Legislation: The Transfer of Property Act, 1882. Prescribed Books: 1. Poonam Pradhan Saxena (Rev.), Mulla’s The Transfer of Property Act (11th ed. 2012) 2. Poonam Pradhan Saxena, ‘Property and Easement’, Halsbury Laws of India; Vol. 12 (2002). 3. Poonam Pradhan Saxena, Property Law (2nd ed. 2011) 4. Vepa. P. Sarathi (Rev.) G.C.V. Subba Rao’s Law of Transfer of Property (3rd ed., 2002)  iii 5. Sen Gupta (Rev.), Mitra’s Transfer of Property Act (18th ed., 2004) 6. S.M. Lahiri, Transfer of Property Act (10th ed., 1986) Topic 1 - Movable / Immovable Property (Sec. 3) Concept of property; Definition of and distinction between movable and immovable property; Meaning of “things attached to earth” and Concept of “Doctrine of fixtures” 1. Shantabai v. State of Bombay, AIR 1958 SC 532 : (1959) SCR 265 1 2. State of Orissa v. Titaghur Paper Mills Company Limited, AIR 1985 SC 1293 : (1985) Supp SCC 280 6 3. Bamadev Panigrahi v. Monorama Raj, AIR 1974 AP 226 25 4. Duncans Industries Ltd. v. State of U.P. (2000)1 SCC 633 32 Topic 2 – Attestation (Sec. 3) Importance of attestation; who may be a competent witness; mode of attestation; attestation by a Pardanashin woman 5. Kumar Harish Chandra Singh Deo v. Bansidhar Mohanty, AIR 1965 SC 1738 : (1966) 1 SCR 153 37 6. M.L.Abdul Jabbar Sahib v. H. Venkata Sastri, AIR 1969 SC 1147 : (1969) 1 SCC 573 39 7. Padarath Halwai v. Ram Narain, AIR 1915 PC 21 44 Topic 3 - Notice (Sec. 3) Relevance of doctrine of Notice; Actual and Constructive Notice; Wilful abstention from making an inquiry and gross negligence; Actual Possession; Registration and Notice to agent as Constructive Notice 8. Ahmedabad Municipal Corporation v. Haji Abdul Gafur Haji Hussenbhai, AIR 1971 SC 1201 ; (1971) 1 SCC 757 45 9. Md. Mustafa v. Haji Md. Isa, AIR 1987 Pat 5 52 10. H.N.Narayanaswamy Naidu v. Deveeramma, AIR 1981 Kant 93 57 11. Ram Niwas v. Bano, AIR 2000 SC 2921 : (2000) 6 SCC 685 59 Topic 4 - Meaning of Transfer of Property (Sec. 5) Meaning of ‘Transfer of Property’ under the Act; Transfer intervivos; Living person distinguished from juristic person; Status of partition of joint family property 12. V.N. Sarin v. Ajit Kumar Poplai, AIR 1966 SC 432 : (1966) 1 SCR 349 63  iv 13. Kenneth Solomon v. Dan Singh Bawa, AIR 1986 Del 1 67 14. Mohar Singh v. Devi Charan, AIR 1988 SC 1365 : 70 (1988) 3 SCC 63 15. N. Ramaiah v. Nagaraj S, AIR 2001 Kant. 395 72 Topic 5 - What Kind of Property can be transferred [Sec. 6(a) and 43] Transfer of “Spes Successionis”; Transfer by heir apparent; Chance of a relation obtaining a legacy on the death of a kinsman; Comparison with fraudulent and erroneous unauthorized transfers; Doctrine of “Feeding the grant by estoppel”; Status of bonafide transferee for consideration and without notice 16. Jumma Masjid, Mercara v. Kodimaniandra Deviah, AIR 1962 SC 847: 1962 Supp (1) SCR 554 76 17. Kartar Singh v. Harbans Kaur (1994) 4 SCC 730 83 Topic 6 – Conditional Transfer (Sec. 10, 11 and 40) Transfers subject to a condition or limitation; Absolute and partial restraints on transfer; Exception in case of lease and married women; Restrictions repugnant to interests created; General principles; Restrictions for beneficial enjoyment of one’s own land; Positive and negative covenants 18. Rosher v. Rosher (1884) 26 Ch D 801 85 19. Muhammad Raza v. Abbas Bandi Bibi, (1932) I.A. 236 87 20. Zoroastrian Co-operative Housing Society Ltd. v. District Registrar, Co-op. Societies (Urban) (2005) 5 SCC 632 91 21. Tulk v. Moxhay (1848) 2 Ch. 774 100 Topic 7 - Transfer for the benefit of unborn persons (Sec. 13-18) Creation of prior interests and absolute interests in favour of unborn persons; Rule against perpetuity; Period of perpetuity; Rule of possible and actual events; Transfer to a class; Transfer when prior interest fails; Directions for accumulation of income; Exceptions 22. Ram Newaz v. Nankoo, AIR 1926 All 283 102 23. Ram Baran Prasad v. Ram Mohit,Hazra AIR 1967 SC 744 : (1967) 103 1 SCR 293 24. R. Kempraj v. Burton Son & Co, AIR 1970 SC 1872 : (1969) 2 SCC 594 109 Topic 8 - Vested and Contingent interests (Sec. 19 and 21) Definition of and distinction between vested and contingent interests  v 25. Rajesh Kanta Roy v. Shanti Debi, AIR 1957 SC 255 : 1957 SCR 77 112 Topic 9 - Transfer during pendency of litigation (Sec. 52) Concept of “Lis Pendens”, Meaning of proceedings; Collusive suits; Commencement and conclusion of suits; Specific rights in specific immovable property; Voluntary and involuntary alienations 26. Supreme General Films Exchange Ltd v. Maharaja Sir Brijnath Singhji Deo, AIR 1975 SC 1810 : (1975) 2 SCC 530 120 27. Govinda Pillai Gopala Pillai v. Aiyyappan Krishnan, AIR 1957 Ker. 10 122 28. Dalip Kaur v. Jeewan Ram, AIR 1996 P & H 158 127 2022 LiveLaw (SC)61 of G.T Girish ….Appellant(S) v. Y.Subba Raju (D) By LRs. and Another Respondent (S) Topic 10 - Mortgage (Sec. 58-60, 100) Definition of Mortgage; Kinds of mortgages; Mode of execution of mortgages; Redemption and Foreclosure of mortgages; Clog on equity of redemption; Distinction between mortgage and charge 29. Ganga Dhar v. Shankar Lal, AIR 1958 SC 770 129 30. Pomal Kanji Govindji v. Vrajlal Karsandas Purohit, AIR 1989 SC 436 : (1989) 1 SCC 458 135 31. Shivdev Singh v. Sucha Singh, AIR 2000 SC 1935 : 146 (2000) 4 SCC 326 Topic 11 - Lease and License (Sec. 105, 106 and Indian Easement Act, 1882 Sec. 4 & 52) Definition of lease; Absolute and derivative lease; Lease for a specific time; Periodic lease and lease in perpetuity; Distinction between lease and license 32. Associated Hotels of India v. R.N. Kapoor, AIR 1959 SC 1262 151 33. Quality Cut Pieces v. M. Laxmi, AIR 1986 Bom 359 161 34. B.V. D’Souza v. Antonio Fausto Fernandes, AIR 1989 SC 1816 169 35. Samir Kumar Chatterjee v. Hirendra Nath Ghosh, AIR 1992 Cal 129 172 36. Delta International ltd. v. Shyam Sunder Ganeriwalla, AIR 1999 SC 2607 178 Topic 12 - Gift (Sec. 122-126) Definition of gift; Mode of execution of gift; Suspension and Revocation of gifts  vi 37. Tila Bewa v. Mana Bewa, AIR 1962 Ori. 130 190 38. Kartari v. Kewal Krishan, AIR 1972 HP 117 194 IMPORTANT NOTE: 1. The students are advised to read only the books prescribed above along with legislations and cases. 2. The topics and cases given above are not exhaustive. The teachers teaching the course shall be at liberty to add new topics/cases. 3. The students are required to study the legislations as amended up-to-date and consult the latest editions of books. *****  Smt. Shantabai v. State of Bombay AIR 1958 SC 532: (1959) SCR 265 VIVIAN BOSE, J. - 8. The petitioner’s husband, Balirambhau Doye, was the Zamindar of Pandharpur. On April 26, 1948, he executed an unregistered document, that called itself a lease, in favour of his wife, the petitioner. The deed gives her the right to enter upon certain areas in the zamindari in order to cut and take out bamboos, fuel wood and teak. Certain restrictions are put on the cutting, and the felling of certain trees is prohibited. But in the main, that is the substance of the right. The term of the deed is from April 26, 1948, to December 26, 1960, and the consideration is Rs 26,000. 9. The petitioner says that she worked the forests till 1950. In that year the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, and Alienated Lands) Act, 1950, which came into force on January 26, 1951, was enacted. 10. Under Section 3 of that Act, all proprietary rights in the land vest in the State on and from the date fixed in a notification issued under sub-section (1). The date fixed for the vesting in this area was March 31, 1951. After that, the petitioner was stopped from cutting any more trees. She therefore applied to the Deputy Commissioner, Bhandara, under Section 6(2) of the Act for validating the lease. The Deputy Commissioner held, on August 16, 1955, that the section did not apply because it only applied to transfers made after March 16, 1950, whereas the petitioner’s transfer was made on April 26, 1948. But, despite that, he went on to hold that the Act did not apply to transfers made before March 16, 1950, and so leases before that could not be questioned. He also held that the lease was genuine and ordered that the petitioner be allowed to work the forests subject to the conditions set out in her lease and to the Rules framed under Section 218(A) of the C.P. Land Revenue Act. 11. It seems that the petitioner claimed compensation from Government for being ousted from the forests from 1951 to 1955 but gave up the claim on the understanding that she would be allowed to work the forests for the remaining period of the term in accordance with the Deputy Commissioner’s order dated August 16, 1955. 12. She thereupon went to the Divisional Forest Officer at Bhandara and asked for permission to work the forests in accordance with the above order. She applied twice and, as all the comfort she got was a letter saying that her claim was being examined, she seems to have taken the law into her own hands, entered the forests and started cutting the trees; or so the Divisional Forest Officer says. 13. The Divisional Forest Officer thereupon took action against her for unlawful cutting and directed that her name be cancelled and that the cut materials be forfeited. This was on March 19, 1956. Because of this, the petitioner went up to the Government of Madhya Pradesh and made an application dated September 27, 1956, asking that the Divisional Forest Officer be directed to give the petitioner immediate possession and not to interfere with her rights. Then, as nothing tangible happened, she made a petition to this Court under Article 32 of the Constitution on August 26, 1957. 14. The foundation of the petitioner’s rights is the deed of April 26, 1948. The exact nature of this document was much canvassed before us in the arguments by both sides. It was said at various times by one side or the other to be a contract conferring contractual rights, a transfer, a licence coupled with a grant, that it related to movable property and that, contra, it related to immovable property. It will be necessary, therefore, to ascertain its true nature before I proceed further. 2 15. As I have said, the document calls itself a “lease deed”, but that is not conclusive because the true nature of a document cannot be disguised by labelling it something else. 16. Clause (1) of the deed runs - “We executed this lease deed... and which by this deed have been leased out to you in consideration of Rs 26,000 for taking out timber, fuel and bamboos etc.” At the end of clause (2), there is the following para: “You No. 1 are the principal lessee, while Nos. 2 and 3 are the sub-lessees.” Clause (3) contains a reservation in favour of the proprietor. A certain portion of the cutting was reserved for the proprietor and the petitioner was only given rights in the remainder. The relevant passage runs: “Pasas 16, 17, 18 are already leased out to you in your lease. The cutting of its wood be made by the estate itself. Thereafter, whatever stock shall remain standing; it shall be part of your lease. Of this stock, so cut, you shall have no claim whatsoever.” Clause (5) runs - “Besides the above pasas the whole forest is leased out to you. Only the lease of the forest woods is given to you.” Clause (7) states - “The proprietorship of the estate and yourself are (in a way) co-related and you are managing the same and therefore in the lease itself and concerning it, you should conduct yourself only as a lease holder explicitly.... Only in the absence of the Malik, you should look after the estate as a Malik and only to that extent you should hold charge as such and conduct yourself as such with respect to sub-lessees.” The rest of this clause is - “Without the signatures of the Malik, nothing would be held valid and acceptable, including even your own pasas transactions....The lease under reference shall not be alterable or alienable by anybody.” The only other clause to which reference need be made is clause (8). It runs - “You should not be permitted to recut the wood in the area which was once subject to the operation of cutting, otherwise the area concerned will revert to the estate. The cutting of the forests should be right at the land surface and there should not be left any deep furrows or holes.” 17. I will examine the seventh clause first. The question is whether it confers any proprietary rights or interest on the petitioner. I do not think it does. It is clumsily worded but I think that the real meaning is this. The petitioner is the proprietor’s wife and it seems that she was accustomed to do certain acts of management in his absence. The purpose of clause (7) is to ensure that when she acts in that capacity she is not to have the right to make any alteration in the deed. There are no words of transfer or conveyance and I do not think any part of the proprietary rights, or any interest in them, are conveyed by this clause. It does not even confer rights of management. It only recites the existing state of affairs and either curtails or clarifies powers as manager that are assumed to exist when the proprietor is away.  3 18. Although the document repeatedly calls itself a lease, it confers no rights of enjoyment in the land. Clause (5) makes that clear, because it says - “Only the lease of the forest woods is given to you.” In my opinion, the document only confers a right to enter on the lands in order to cut down certain kinds of trees and carry away the wood. To that extent the matter is covered by the decision in Chhotabhai Jethabhai Patel & Co. v. State of Madhya Pradesh [AIR 1953 SC 108 at 110] and by the later decision in Ananda Behera v. State of Orissa [AIR 1956 SC 17, 18 and 19] where it was held that a transaction of this kind amounts to a licence to enter on the land coupled with a grant to cut certain trees on it and carry away the wood. In England it is a profit a prendre because it is a grant of the produce of the soil “like grass, or turves or trees”. See 12 Halsbury’s Laws of England (Simonds Edn.) page 522. It is not a “transfer of a right to enjoy the immoveable property” itself (Section 105 of the Transfer of Property Act), but a grant of a right to enter upon the land and take away a part of the produce of the soil from it. In a lease, one enjoys the property but has no right to take it away. In a profit a prendre one has a licence to enter on the land, not for the purpose of enjoying it, but for removing something from it, namely, a part of the produce of the soil. 19. Much of the discussion before us centred round the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act of 1950. But I need not consider that because this, being a writ petition under Article 32, the petitioner must establish a fundamental right. For the reasons given in Ananda Behera case, I would hold that she has none. This runs counter to Chhotebhai Jethabai Patel case, but, as that was a decision of three Judges and the other five, I feel that we are bound to follow the later case, that is to say, Ananda Behera case, especially as I think it lays down the law aright. 20. The learned counsel for the petitioner contended that his client’s rights flowed out of a contract and so, relying on Chhotebhai Jethabai Patel case, he contended that he was entitled to a writ. As a matter of fact, the rights in the earlier case were held to flow from a licence and not from a contract simpliciter but it is true that the learned Judges held that a writ petition lay. 21. Insofar as the petitioner rests her claim in contract simpliciter, I think she has no case because of the reasons given in Ananda Behera case: “If the petitioners’ rights are no more than the right to obtain future goods under the Sale of Goods Act, then that is a purely personal right arising out of a contract to which the State of Orissa is not a party and in any event a refusal to perform the contract that gives rise to that right may amount to a breach of contract but cannot be regarded as a breach of any fundamental right.” To bring the claim under Article 19(1)(f) or Article 31(1) something more must be disclosed, namely, a right to property of which one is the owner or in which one has an interest apart from a purely contractual right. Therefore, the claim founded in contract simpliciter disappears. But, insofar as it is founded either on the licence, or on the grant, the question turns on whether this is a grant of movable or immoveable property. Following the decision in Ananda Behera case, I would hold that a right to enter on land for the purpose of cutting and carrying away timber standing on it is a benefit that arises out of land. There is no difference there between the English and the Indian law. The English law will be found in 12 Halsbury’s Laws of England (Simonds Edn.) pp. 620-621. But that still leaves the question whether this is movable or immovable property. 4 22. Under Section 3(26) of the General Clauses Act, it would be regarded as “immoveable property” because it is a benefit that arises out of the land and also because trees are attached to the earth. On the other hand, the Transfer of Property Act says in Section 3 that standing timber is not immovable property for the purposes of that Act and so does Section 2(6) of the Registration Act. The question is which of these two definitions is to prevail. 23. Now it will be observed that “trees” are regarded as immoveable property because they are attached to or rooted in the earth. Section 2(6) of the Registration Act expressly says so and, though the Transfer of Property Act does not define immoveable property beyond saying that it does not include “standing timber growing crops or grass”, trees attached to earth (except standing timber) are immoveable property, even under the Transfer of Property Act, because of Section 3(26) of the General Clauses Act. In the absence of a special definition, the general definition must prevail. Therefore, trees (except standing timber) are immoveable property. 24. Now, what is the difference between standing timber and a tree? It is clear that there must be a distinction because the Transfer of Property Act draws one in the definitions of “immoveable property” and “attached to the earth”; and it seems to me that the distinction must lie in the difference between a tree and timber. It is to be noted that the exclusion is only of “standing timber” and not of “timber trees”. Timber is well enough known to be - “wood suitable for building houses, bridges, ships etc., whether on the tree or cut and seasoned.” (Webster’s Collegiate Dictionary). Therefore, “standing timber” must be a tree that is in a state fit for these purposes and, further, a tree that is meant to be converted into timber go shortly that it can already be looked upon as timber for all practical purposes even though it is still standing. If not, it is still a tree because, unlike timber, it will continue to draw sustenance from the soil. 25. Now, of course, a tree will continue to draw sustenance from the soil so long as it continues to stand and live; and that physical fact of life cannot be altered by giving it another name and calling it “standing timber”. But the amount of nourishment it takes, if it is felled at a reasonably early date, is so negligible that it can be ignored for all practical purposes and though, theoretically, there is no distinction between one class of tree and another, if the drawing of nourishment from the soil is the basis of the Rule, as I hold it to be, the law is grounded, not so much on logical abstractions as on sound and practical common-sense. It grew empiracally from instance to instance and decision to decision until a recognisable and workable pattern emerged; and here, this is the shape it has taken. 26. The distinction, set out above, has been made in a series of Indian cases that are collected in Mulla’s Transfer of Property Act, 4th Edn. at pp. 16 and 21. At p. 16, the learned author says — “Standing timber are trees fit for use for building or repairing houses. This is an exception to the general Rule that growing trees are immoveable property.” At p. 21 he says - “Trees and shrubs may be sold apart from the land, to be cut and removed as wood, and in that case they are moveable property. But if the transfer includes the right to fell the trees for a term of years, so that the transferee derives a benefit from further growth, the transfer is treated as one of immoveable property.”  5 The learned author also refers to the English law and says at page 21 - “In English law an unconditional sale of growing trees to be cut by the purchaser, has been held to be a sale of an interest in land; but not so if it is stipulated that they are to be removed as soon as possible.” 27. In my opinion, the distinction is sound. Before a tree can be regarded as “standing timber” it must be in such a state that, if cut, it could be used as timber; and when in that state it must be cut reasonably early. The Rule is probably grounded on generations of experience in forestry and commerce and this part of the law may have grown out of that. It is easy to see that the tree might otherwise deteriorate and that its continuance in a forest after it has passed its prime might hamper the growth of younger wood and spoil the forest and eventually the timber market. But however that may be, the legal basis for the Rule is that trees that are not cut continue to draw nourishment from the soil and that the benefit of this goes to the grantee. 28. Now how does the document in question regard this? In the first place, the duration of the grant is twelve years. It is evident that trees that will be fit for cutting twelve years hence will not be fit for felling now. Therefore, it is not a mere sale of the trees as wood. It is more. It is not just a right to cut a tree but also to derive a profit from the soil itself, in the shape of the nourishment in the soil that goes into the tree and makes it grow till it is of a size and age fit for felling as timber; and, if already of that size, in order to enable it to continue to live till the petitioner chooses to fell it. 29. This aspect is emphasised in clause (5) of the deed where the cutting of teak trees under 1½ feet is prohibited. But, as soon as they reach that girth within the twelve years, they can be felled. And clause (4) speaks of a first cutting and a second cutting and a third cutting. As regards trees that could be cut at once, there is no obligation to do so. They can be left standing till such time as the petitioner chooses to fell them. That means that they are not to be converted into timber at a reasonably early date and that the intention is that they should continue to live and derive nourishment and benefit from the soil; in other words, they are to be regarded as trees and not as timber that is standing and is about to be cut and used for the purposes for which timber is meant. It follows that the grant is not only of standing timber but also of trees that are not in a fit state to be felled at once but which are to be felled gradually as they attain the required girth in the course of the twelve years; and further, of trees that the petitioner is not required to fell and convert into timber at once even though they are of the required age and growth. Such trees cannot be regarded as timber that happens to be standing because timber, as such, does not draw nourishment from the soil. If, therefore, they can be left for an appreciable length of time, they must be regarded as trees and not as timber. The difference lies there. 30. The result is that, though such trees as can be regarded as standing timber at the date of the document, both because of their size and girth and also because of the intention to fell at an early date, would be moveable property for the purposes of the Transfer of Property and Registration Acts, the remaining trees that are also covered by the grant will be immoveable property, and as the total value is Rs 26,000, the deed requires registration. Being unregistered, it passes no title or interest and, therefore, as in Ananda Behera case the petitioner has no fundamental right which she can enforce. 31. My lord the Chief Justice and my learned Brothers prefer to leave the question whether the deed here is a lease or a licence coupled with a grant, open because, on either view the petitioner must fail. But we are all agreed that the petition be dismissed with costs. **** 6 State of Orissa v. Titaghur Paper Mills Co. Ltd. AIR 1985 SC 1293 : 1985 Supp SCC 280 MADON, J. - Genesis of the Appeals: 2. On May 23, 1977, the Government of Orissa in the Finance Department issued two notifications under the Orissa Sales Tax Act, 1947. We will hereinafter for the sake of brevity refer to this Act as “the Orissa Act”. These notifications were Notification S.R.O. No. 372 of 1977 and Notification S.R.O. No. 373 of 1977. Notification S.R.O. No. 372 of 1977 was made in exercise of the powers conferred by Section 3-B of the Orissa Act and Notification S.R.O. No. 373 of 1977 was made in exercise of the powers conferred by the first proviso to sub-section (1) of Section 5 of the Orissa Act. We will refer to these notifications in detail in the course of this judgment but for the present suffice it to say that Notification S.R.O. No. 372 of 1977 amended Notification No. 20209-CTA-14/76-F dated April 23, 1976, and made bamboos agreed to be severed and standing trees.agreed to be severed liable to tax on the turnover of purchase with effect from June 1, 1977, while Notification S.R.O. No. 373 of 1977 amended with effect from June 1, 1977, Notification No. 20212-GTA-14/76-F dated April 23, 1976, and directed that the tax payable by a dealer under the Orissa Act on account of the purchase of bamboos agreed to be severed and standing trees agreed to be severed would be at the rate of ten per cent. After the promulgation on December 29, 1977, of the Orissa Sales Tax (Amendment) Ordinance, 1977 (Orissa Ordinance 10 of 1977), which amended the Orissa Act, two other notifications were issued on December 29, 1977, by the Government of Orissa in the Finance Department, namely, Notification No. 67178-C.T.A. 135/77(Pt.)-F (S.R.O. No. 900 of 1977) and Notification No. 67181-C.T.A. 135/77-F (S.R.O. No; 901 of 1977). The first notification was expressed to be made in exercise of the powers conferred by Section 3-B of the Orissa Act and in supersession of all previous notifications issued on that subject. By the said notification the State Government declared that the goods set out in the Schedule to the said notification were liable to be taxed on the turnover of purchase with effect from January 1, 1978. Entries 2 and 17 in the Schedule to the said notification specified bamboos agreed to be severed and standing trees agreed to be severed respectively. The second notification was expressed to be made in exercise of the powers conferred by sub-section (1) of Section 5 of the Orissa Act and in supersession of all previous notifications in that regard. By the said notification the State Government directed that with effect from January 1, 1978, the tax payable by a dealer under the Orissa Act on account of the purchase of goods specified in column (2) of the Schedule to the said notification would be at the rate specified against it in column (3) thereof. In the said Schedule the rate of purchase tax for bamboos agreed to be severed and standing trees agreed to be severed was prescribed as ten per cent. The relevant entries in the Schedule in that behalf are Entries 2 and 17. The Orissa Sales Tax (Amendment) Ordinance, 1977, was repealed and replaced by the Orissa Sales Tax (Amendment) Act, 1978. 3. As many as 209 writ petitions under Article 226 of the Constitution of India were filed in the High Court of Orissa challenging the validity of the aforesaid two notifications dated May 23, 1977, and the said Entries 2 and 17 in each of the said two notifications dated December 29, 1977 (“the impugned provisions”). The petitioners before the High Court fell into two categories. The first category consisted of those who had entered into agreements with the State of Orissa for the purpose of felling, cutting, obtaining and removing bamboos from forest areas “for the purpose of converting the bamboo into paper pulp or for purposes connected with the manufacture of paper or in any connection incidental therewith”. This agreement will be hereinafter referred to as “the Bamboo  7 Contract”. The other group consisted of those who had entered into agreements for the purchase of standing trees. We will hereinafter refer to this agreement as “the Timber Contract”. All the Bamboo Contracts before the High Court were in the same terms except with respect to the contract area, the period of the agreement and the amount of royalty payable; and the same was the case with the Timber Contracts. By a common judgment delivered on September 19, 1979, reported as Titaghur Paper Mills Company Ltd. v. State of Orissa [(1980) Tax LR 1643], the High Court allowed all the said writ petitions and quashed the impugned provisions. The High Court made no order as to the costs of these petitions. 4. Each of the present two appeals has been filed by the State of Orissa, the Commissioner of Sales Tax, Orissa, and the Sales Tax Officer concerned in the matter, challenging the correctness of the said judgment of the High Court. The respondents in Civil Appeal 219 of 1982 are the Titaghur Paper Mills Company Limited (“the respondent Company”) and one Kanak Ghose, a shareholder and director of the respondent Company. The respondents in Civil Appeal 220 of 1982 are Mangaiji Mulji Khara, a partner of the firm of Messrs M.M. Khara, and the said firm. The Chief Conservator of Forests, Orissa, the Divisional Forest Officer, Rairkhol Division, and the Divisional Forest Officer, Deogarh Division, have also been joined as pro forma respondents to the said appeal. 48. What now falls to be determined is the subject-matter of the impugned provisions. Relying upon the definition of the term “goods’“ in the Sale of Goods Act, 1930, and in the Orissa Act, it was submitted on behalf of the appellant State that the subject-matter of the impugned provisions is goods and that what is made exigible to tax under the impugned provisions is a completed purchase of goods. On behalf of the contesting respondents it was submitted that by impugned provisions a new class of goods not known to law was sought to be created and made exigible to purchase tax and that this attempt on the part of the State Government was unconstitutional as being beyond its legislative competence. The High Court held that the impugned provisions amounted to a tax on an agreement of sale and not on a sale or purchase of goods. It further held that in the case of Bamboo Contracts, the impugned provisions also amount to levying a tax on a profit a prendre. 49. The term ‘goods’ is defined in clause (7) of Section 2 of the Sale of Goods Act as follows: (7) “goods” means every kind of movable property other than actionable claims and money; and includes stock and shares, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale; We have already reproduced earlier the definition of ‘goods’ given in.clause {d} of Section 2 of the Orissa Act. However, for the purposes of ready reference and comparison, we arc reproducing the same here again. That definition is as follows: (7) “Goods’“ means all kinds of movable property other than actionable claims, stocks, shares or securities, and includes all growing crops, grass and things attached to or forming part of the land which are agreed before sale or under the contract of sale to be severed. What is pertinent to note, however, is that under both the definitions the term ‘goods’ means all kinds of moveable property (except the classes of movable property specifically excluded) and includes growing crops, grass and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale. The Transfer of Property Act, 1882, does not give any definition of the term ‘moveable property’, but clause (36) of Section 3 of the General Clauses Act, 1897, clause (27) of the Orissa General Clauses Act, 1937 and clause (9) of Section 2 of the Registration Act, 1908. Section 3 of the General Clauses Act provides as follows: 8 (36) “movable property” shall mean property of every description, except immovable property. The definition in the Orissa General Clauses Act is in identical terms The definition in the Registration Act is as follows: (9) “moveable property” includes standing timber, growing crops and grass, fruit upon and juice in trees, and property of every other description, except immovable property; The Transfer of Property Act does not give any exhaustive definition of ‘immovable property’. The only definition given therein is in Section 3 which states: “immovable property” does not include standing timber, growing crops or grass. 50. This is strictly speaking not a definition of the term ‘immovable property’ for it does not tell us what immovable property is but merely tells us what it does not include. We must, therefore, turn to other Acts where that term is defined. Clause (26) of Section 3 of the General Clauses Act defines ‘immovable property* as follows: (26) “immovable property” shall include land, benefits to arise out of land, and things attached to the earth, or permanently fastened to any thing attached to the earth. The definition of immovable property in clause (21) of Section 2 of the Orissa General Clauses Act is in the same terms A more elaborate definition is given in clause (6) of Section 2 of the Registration Act which states: (6) “immovable property” includes land, buildings, hereditary allowances, rights to ways, lights, ferries, fisheries or any other benefit to arise out of land, and things attached to the earth, or permanently fastened to anything which is attached to the earth, but not standing timber, growing crops nor grass. What is pertinent to note about these definitions is that things attached to the earth are immovable property. The expression “attached to the earth” is defined in Section 3 of the Transfer of Property Act as follows: “attached to the earth” means - (a) rooted in the earth, as in the case of trees and shrubs; (b) imbedded in the earth, as in the case of walls or buildings; or (c) attached to what is so imbedded for the permanent beneficial enjoyment of that to which it is attached. 51. Thus, while trees rooted in the earth are immovable property as being things attached to the earth by reason of the definition of the term ‘immovable property’ given in the General Clauses Act, the Orissa General Clauses Act and the Registration Act, read with the definition of the expression “attached to the earth” given in the Transfer of Property Act, standing timber is moveable property by reason of it being excluded from the definition of ‘immovable property’ in the Transfer of Property Act and the Registration Act and by being expressly included within the meaning of the term ‘moveable property’ given in the Registration Act. The distinction between a tree and standing timber has been pointed out by Vivian Bose, J., in his separate but concurring judgment in the case of Smt Shantabai v. State of Bombay [AIR 1958 SC 532 ] as follows: Now, what is the difference between standing timber and a tree? It is clear that there must be a distinction because the Transfer of Property Act draws one in the definitions of  9 “immovable properly” and “attached to the earth”; and it seems to me that the distinction must lie in the difference between a tree and timber. It is to be noted that the exclusion is only of “standing timber” and not of “timber trees” Timber is well enough known to be- “wood suitable for building houses, bridges, ships, etc., whether on the tree or cut and seasoned.” {Webster’s Collegiate Dictionary). Therefore, “standing timber” must be a tree that is in a state fit for these purposes and, further, a tree that is meant to be converted into timber so shortly that it can already be looked upon as timber for all practical purposes even though it is still standing. If not, it is still a tree because, unlike timber, it will continue to draw sustenance from the soil. Now, of course, a tree will continue to draw sustenance from the soil so long as it continues to stand and live; and that physical fact of life cannot be altered by giving it another name and calling it “standing timber”. But the amount of nourishment it takes, if it is felled at a reasonably early date, is so negligible that it can be ignored for all practical purposes and though, theoretically, there is no distinction between one class of tree and another, if the drawing of nourishment from the soil is the basis of the rule, as I hold it to be, the law is grounded, not so much on logical abstractions as on sound and practical commonsense. It grew empirically from instance to instance and decision to decision until a recognisable and workable pattern emerged; and here, this is the shape it has taken. Thus, trees which are ready to be felled would be standing timber and, therefore, moveable property. What is, however, material for our purpose is that while trees (including bamboos) rooted in the earth being things attached to the earth are immovable property and if they are standing timber are moveable property, trees (including bamboos) rooted in the earth which are agreed to be severed before sale or under the contract of sale are not only moveable property but also goods. 52. In this connection it may be mentioned that in English law there exists (or rather existed) a difference between fructus naturales and fructus industriales. Fructus naturales are natural growth of the soil, such as, grass, timber and fruit on trees, which were regarded at common law as part of the soil. Fructus industrials are fruits or crops produced “in the year, by the labour of the year” in sowing and reaping, planting, and gathering, e.g., corn and potatoes. Fructus industriales are traditionally chattels being considered the ‘representative’ of the labour and expense of the occupier and thing independent of the land in which they are growing and were not treated as an interest in land. Fructus naturales are regarded until severance as part of the soil and an agreement conferring any right or interest in them upon a buyer before severance was a contract or sale of an interest in land and were, therefore, governed by Section 4 of the Statute of Frauds of 1677 (29 Car. II c. 3). If they were severed before sale. Section 17 of that statute applied. This distinction was, therefore, important in England for the purposes of the formalities required under the Statute of Frauds. Under the definition of goods given in Section 62(1) of the old English Sale or Goods Act of 1893, ‘goods’ included inter alia all industrial growing crops and things attached to or forming part of the land which were agreed to be severed before sale or under the contract of sale. The formalities required for a contract for the sale of goods of the value of £10 and upwards by Section 17 of the Statute of Frauds were re-enacted in Section 4 of the Sale of Goods Act, 1893. This section was repealed by the Law Reform (Enforcement of Contracts) Act, 1954. The definition of ‘goods’ in Section 61(1) of the new Sale of Goods Act, 1979, is the same as in the earlier Sale of Goods Act. Thus, the position now in English 10 law is that crops and other produce whether fructus naturales or fructus industriales (except in the case of a sale without severance to a landlord, incoming tenant or purchaser of the land) will always be ‘goods’ for the purposes of a contract of sale since the agreement between the parties must be that they shall be severed either “before sale” or “under the contract of sale”. 53. As pointed out in Mahadeo v. State of Bombay [AIR 1959 SC 735] the distinction which prevailed in English law between fructus naturales and fructus industriales does not exist in Indian law, and the only question which would ‘fall to be considered in India is whether a transaction concerns ‘goods’ or ‘movable property’ or ‘immovable property’. The importance of this question is twofold: (1) in the case of immovable property, a document of the kind specified in Section 17 of the Registration Act requires to be compulsorily registered and if it is not so registered, the consequences mentioned in ‘ Sections 49 and 50 of that Act follow, while a document relating to goods or moveable property is not required to be registered; and (2) by reason of the interpretation placed on Entry 54 in List II in the Seventh Schedule to the Constitution of India by this Court a State cannot levy a tax on the sale or purchase of any property other than ‘goods’. 59. The fallacy underlying the reasoning of the High Court is that it has confused the question of the interpretation of the impugned provisions with the interpretation of Timber Contracts and the Bamboo Contract. On the interpretation it placed upon the Timber Contracts it came to the conclusion that the property in the standing trees passed only after severance and after complying with the conditions of that contract and therefore, the impugned provisions purported to levy a purchase tax on an agreement to sell. In the case of bamboos agreed to be severed, the High Court on an interpretation of the Bamboo Contract held that it was a grant of a profit a prendre and from that it further held that the impugned provisions were bad in law because they amounted to a levy of purchase tax on a profit a prendre. This approach adopted by the High Court was erroneous in law. The question of the validity of the impugned provisions had nothing to do with the legality of any action taken thereunder to make exigible to tax a particular transaction. If a notification is invalid, all actions taken under it would be invalid also. The converse, however, is not true. Where a notification is valid, an action purported to be taken thereunder contrary to the terms of that notification or going beyond the scope of that notification would be bad in law without affecting in any manner the validity of the notification. Were the interpretation placed by the High Court on the Bamboo Contract and the Timber Contracts correct, the transactions covered by them would not be liable to be taxed under the impugned provisions and any attempt or action by the State to do so would be illegal but the validity of the impugned provisions would not be affected thereby. The challenge to the validity of the impugned provisions on the ground of their unconstitutionality must, therefore, fail. 98. The meaning and nature of a profit a prendre have been thus described in Halsbury’s Laws of England, Fourth Edition, Volume 14, paragraphs 240 to 242 at pages 115 to 117: “240. Meaning of ‘profit a prendre’.- A profit a prendre is a right to take something off another person’s land. It may be more fully defined as a right to enter another’s land and to take some profit of the soil, or a portion of the soil itself, for the use of the owner of the right. 241. Profit a prendre as an interest in land.- A profit a prendre is an interest in land, and for this reason any disposition of it must be in writing. A profit a prendre which gives a right to participate in a portion only of some specified produce of the land is just as much an interest in the land as a right to take the whole of that produce.  11 242. What may be taken as a profit a prendre. - The subject-matter of a profit a prendre, namely the substance which the owner of the right is by virtue of the right entitled to take, may consist of animals, including fish and fowl, which are on the land, or of vegetable matter growing or deposited on the land by some agency other than that of man, or of any part of the soil itself, including mineral accretions to the soil by natural forces. The right may extend to the taking of the whole of such animal or vegetable matters or merely a part of them. Rights have been established as profits a prendre to take acorns and beech mast, brakes, fern, heather and litter, thorns, turf and peat, boughs and branches of growing trees, rushes, freshwater fish, stone, sand and shingle from the seashore and ice from a canal; also the right of pasture and of shooting pheasants. There is, however, no right to take seacoal from the foreshore. The right to take animals ferae naturae while they are upon the soil belongs to the owner of the soil, who may grant to others as a profit a prendre a right to come and take them by a grant of hunting, shooting, fowling and so forth.” 99. A profit a prendre is a servitude for it burdens the land or rather a person’s ownership of land by separating from the rest certain portions or fragments of the right of ownership to be enjoyed by persons other than the owner of the thing itself. “Servitude” is a wider term and includes both easements and profits a prendre (see Halsbury’s Laws of England, Fourth Edition, Volume 14, paragraph 3, page 4). The distinction between a profit a prendre and an easement has been thus stated in Halsbury’s Laws of England, Fourth Edition, paragraph 43 at pages 21 to 22: “The chief distinction between an easement and a profit a prendre is that whereas an easement only confers a right to utilise the servient tenement in a particular manner or to prevent the commission of some act on that tenement, a profit a prendre confers a right to take from the servient tenement some part of the soil of that tenement or minerals under it or some part of its natural produce or the animals ferae naturae existing upon it. What is taken must be capable of ownership, for otherwise the right amounts to a mere easement.” In Indian law an easement is defined by Section 4 of the Indian Easement Act, 1882 as being “a right which the owner or occupier of certain land possesses, as such, for the beneficial enjoyment of that land, to do and continue to do something, or to prevent and continue to prevent something being done, in or upon, or in respect of, certain other land not his own”. A profit a prendre when granted in favour of the owner of a dominant heritage for the beneficial enjoyment of such heritage would, therefore, be an easement but it would not be so if the grant was not for the beneficial enjoyment of the grantee’s heritage. 100. Clause (26) of Section 3 of the General Clauses Act, 1897, defines “immovable property” as including inter alia “benefit to arise out of land”. The definition of “immovable property” in clause (f) of Section 2 of the Registration Act, 1908, illustrates a benefit to arise out of land by stating that immovable property “includes... rights to ways, lights, ferries, fisheries or any other benefit to arise out of land”. As we have seen earlier, the Transfer of Property Act, 1882, does not give any definition of “immovable property” except negatively by stating that immovable property does not include standing timber, growing crops, or grass. The Transfer of Property Act was enacted about fifteen years prior to the General Clauses Act. However, by Section 4 of the General Clauses Act, the definitions of certain words and expressions, including “immovable property” and “movable property”, given in Section 3 of that Act are directed to apply also, unless there is anything repugnant in the subject or context, to all Central Acts made after January 3, 1968, and the definitions of these two terms, therefore, apply when they occur in the Transfer of Property Act. In Ananda Behera v. 12 State of Orissa [AIR 1956 SC 17] this Court has held that a profit a prendre is a benefit arising out of land and that in view of clause (26) of Section 3 of the General Clauses Act, it is immovable property within the meaning of the Transfer of Property Act. 101. The earlier decisions showing what constitutes benefits arising out of land have been summarized in Mulla on the Transfer of Property Act, 1882, and it would be pertinent to reproduce the whole of that passage. That passage (at pages 16-17 of the Fifth Edition) is as follows: “A ‘benefit to arise out of land’ is an interest in land and therefore immovable property. The first Indian Law Commissioners in their report of 1879 said that they had ‘abstained from the almost impracticable task of defining the various kinds of interests in immovable things which are considered immovable property’. The Registration Act, however, expressly includes as immovable property benefits to arise out of land, hereditary allowances, rights of way, lights, ferries and fisheries. The definition of immovable property in the General Clauses Act applies to this Act. The following have been held to be immovable property: a varashasan or annual allowance charged on land, a right to collect dues at a fair held on a plot of land; a hat or market; a right to possession and management of a saranjam; a malikana; a right to collect rent or jana; a life interest in the income of immovable property; a right of way; a ferry; and a fishery; a lease of land.” 102. Having seen what the distinctive features of a profit a prendre are, we will now turn to the Bamboo Contract to ascertain whether it can be described as a grant of a profit a prendre and thereafter to examine the authorities cited at the Bar in this connection. Though both the Bamboo Contract in some of its clauses and the Timber Contracts speak of “the forest produce sold and purchased under this Agreement”, there are strong countervailing factors which go to show that the Bamboo Contract is not a contract of sale of goods. While each of the Timber Contracts is described in its body as “an agreement for the sale and purchase of forest produce”, the Bamboo Contract is in express terms described as “a grant of exclusive right and licence to fell, cut, obtain and remove bamboos... for the purpose of converting the bamboos into paper pulp or for purposes connected with the manufacture of paper....”. Unlike the Timber Contracts, the Bamboo Contract is not an agreement to sell bamboos standing in the contract areas with an accessory licence to enter upon such areas for the purpose of felling and removing the bamboos nor is it, unlike the Timber Contracts, in respect of a particular felling season only. It is an agreement for a long period extending to fourteen years, thirteen years and eleven years with respect to different contract areas with an option to the respondent Company to renew the contract for a further term of twelve years and it embraces not only bamboos which are in existence at the date of the contract but also bamboos which are to grow and come into existence thereafter. The payment of royalty under the Bamboo Contract has no relation to the actual quantity of bamboos cut and removed. Further, the respondent Company is bound to pay a minimum royalty and the amount of royalty to be paid by it is always to be in excess of the royalty due on the bamboos cut in the contract areas. 104. Under the Bamboo Contract, the respondent Company has the right to use all lands, roads and streams within as also outside the contract areas for the purpose of free ingress to and egress from the contract areas. It is also given the right to make dams across streams, cut canals, make water courses, irrigation works, roads, bridges, buildings, tramways and other work useful or necessary for the purpose of its business of felling, cutting and removing bamboos for the purpose of converting the  13 same into paper pulp or for purposes connected with the manufacture of paper. For this purpose it has also the right to use timber and other forest produce to be paid for at the current schedule of rates. The respondent Company has the right to extract fuel from areas allotted for that purpose in order to meet the fuel requirements of the domestic consumption in the houses and offices of the persons employed by it and to pay a fixed royalty for this purpose. Further, the Government was bound, if required by the respondent Company, to lease to it a suitable site or sites selected by it for the erection of storehouses, sheds, depots, bungalows, staff offices, agencies and other buildings of a like nature. 105. We have highlighted above only the important terms and conditions which go to show that the Bamboo Contract is not and cannot be a contract of sale of goods. It confers upon the respondent Company a benefit to arise out of land, namely, the right to cut and remove bamboos which would grow from the soil coupled with several ancillary rights and is thus a grant of a profit a prendre. It is equally not possible to view it as a composite contract one, an agreement relating to standing bamboos agreed to be severed and the other, an agreement relating to bamboos to come into existence in the future. The terms of the Bamboo Contract make it clear that it is one, integral and indivisible contract which is not capable of being severed in the manner canvassed on behalf of the appellant. It is not a lease of the contract areas to the respondent Company for its terms clearly show that there is no demise by the State Government of any area to the respondent Company. The respondent Company has also no right to the exclusive possession of the contract areas but has only a right to enter upon the land to take a part of the produce thereof for its own benefit. Further, it is also pertinent that while this right to enter upon the contract areas is described as a “licence”, under Clause XXV of the Bamboo Contract the respondent Company has the right to take on lease a suitable site or sites of its choice within the contract areas for the erection of storehouses, sheds, depots, bungalows, staff offices, agencies and other buildings of a like nature required for the purposes of its business. The terms and conditions of the Bamboo Contract leave no doubt that it confers upon the respondent company a benefit to arise out of land it would thus be an interest in immovable property. As the grant is of the value exceeding Rs 100, the Bamboo Contract is compulsorily registrable. It is, in fact, not registered. This is, however, immaterial because it is a grant by the Government of an interest in land and under Section 90 of the Registration Act it is exempt from registration. The High Court was, therefore, right in holding that the Bamboo Contract was a grant of a profit a prendre, though the grant of such right not being for the beneficial enjoyment of any land of the respondent Company, it would not be an easement. Being a profit a prendre or a benefit to arise out of land any attempt on the part of the State Government to tax the amounts payable under the Bamboo Contract would not only be ultra vires the Orissa Act but also unconstitutional as being beyond the State’s taxing power under Entry 54 in List II in the Seventh Schedule to the Constitution of India. 106. We will now turn to the authorities cited at the Bar. The cases which have come before the courts on this point have mainly involved the question whether the document before the court required registration. After the coming into force of the Constitution of India and the introduction of land reforms with consequent abolition of “Zamindari” and other proprietary interests in land, the question whether a particular document was a grant of a proprietary interest in land has also fallen for determination by various courts. It is unnecessary to refer to all the decisions which were cited before us and we propose to confine ourselves to considering only such of them as are directly relevant to the question which we have to decide. Of the High Court decisions the one most in point is that of a Full Bench of the Madras High Court in Seeni Chettiar v. Santhanathan Chettiar [(1897) ILR 20 Mad 58]. The question in that case was whether a document which granted to the defendant a right to enjoy 14 the produce of all the trees on the bank and bed of a tank as also the grass and the reeds and further to cut and remove the trees for a period exceeding four years required registration. The Court held that the document was not a lease because it did not transfer to the defendant exclusive possession of the tank but conferred upon him merely a right of access to the place for the reasonable enjoyment of what he was entitled to under the contract. The Court, however, came to the conclusion that the document required registration as it transferred an interest in immovable property, and that it was not a sale of mere standing timber but it was contemplated by the document, as shown by the fact that a comparatively long period of a little more than four years was granted to the defendant for cutting and removing the trees, that “the purchaser should derive a benefit from the further growth of the thing sold, from further vegetation and from the nutriment to be afforded by the land”. The above words quoted in the judgment in that case were those of Sir Edward Vaughan Williams in the following passage cited with approval by Lord Coleridge, C.J., in Marshall v. Green [1875) 1 CPD 35.39]: “The principle of these decisions appears to be this, that wherever at the time of the contract it is contemplated that the purchaser should derive a benefit from the further growth of the thing sold, from further vegetation and from the nutriment to be afforded by the land, the contract is to be considered as for an interest in land; but where the process of vegetation is over, or the parties agree that the thing sold shall be immediately withdrawn from the land, the land is to be considered as a mere warehouse of the thing sold, and the contract is for goods.” 107. So far as the decisions of this Court are concerned, the one which requires consideration first is Firm Chhotabhai Jethabai Patel & Co. v. State of M.P. [AIR 1953 SC 108]. This was one of the two cases strongly relied upon by the appellant, the other being State of M.P. v. Orient Paper Mills Ltd.[AIR 1977 SC 687] The facts in Chhotabhai case were that the petitioners had entered into contracts with the proprietors of certain estates and mahals in the State of Madhya Pradesh under which they acquired the right to pluck, collect and carry away tendu leaves; to cultivate, culture and acquire lac; and to cut and carry away teak and timber and miscellaneous species of trees called hardwood and bamboos. On January 26, 1951, the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1950 came into force and on the very next day a notification was issued under the said Act putting an end to all proprietary rights in estates, mahals and alienated villages and vesting the same in the State for the purposes of the State free of all encumbrances with effect from March 31, 1952. The petitioners thereupon approached this Court under Article 32 of the Constitution of India praying for a writ prohibiting the State of Madhya Pradesh from interfering with the rights which they had acquired under the contracts with the former proprietors. It was averred in the petitions that not only had the petitioners paid the consideration under the said contracts but had also spent large sums of money in the exercise of their rights under the said contracts. This Court held that the contracts appeared to be in essence and effect licences granted to the petitioners to cut, gather and carry away the produce in the shape of tendu leaves, lac, timber or wood and did not create any interest either in the land or in the trees or plants. In arriving at this conclusion the Court relied upon a decision of the Judicial Committee of the Privy Council in Mohanlal Hargovind of Jubbulpore v. CIT, C.P. & Berar, Nagpur [AIR 1949 PC 311]. In that case the assessees carried on business as manufacturers and vendors of bidis composed of tobacco contained or rolled in tendu leaves. The contracts entered into by the assessees were short term contracts under which in consideration of a sum payable by instalments the assessees were granted the exclusive right to collect and remove tendu leaves from specified areas. Some of the contracts also granted to the assessees a small ancillary right  15 of cultivation. The Judicial Committee held that the amounts paid by the assessees under the said contracts constituted expenditure in order to secure raw materials for their business and, therefore, such expenditure was allowable as being on revenue account. In Chhotabhai case this Court took the view that the contracts before it were similar to the contracts before the Judicial Committee and quoted with approval the following passage from the judgment in Mohanlal Hargovind case: The contracts grant no interest in land and no interest in the trees or plants themselves. They are simply and solely contracts giving to the grantees the right to pick and carry away leaves, which of course, implies the right to appropriate them as their own property. The small right of cultivation given in the first of the two contracts is merely ancillary and is of no more significance than would be, e.g., a right to spray a fruit tree given to the person who has bought the crop of apples. The contracts are short-term contracts. The picking of the leaves under them has to start at once or practically at once and to proceed continuously. According to this Court, the contracts entered into by the petitioners before it related to goods which had a potential existence and there was a sale of a right to such goods as soon as they came into existence, the question whether the title passed on the date of the contract itself or later depending upon the intention of the parties. This Court, therefore, came to the conclusion that the State had no right to interfere with the petitioners’ rights under the said contracts. 108. As we will later point out, the authority of the decision in Chhotabhai case has been considerably shaken, if not wholly eroded, by subsequent pronouncements of this Court. For the present, it will be sufficient for us to point out that the reliance placed in Chhotabhai case on the decision of the Judicial Committee in Mohanlal Hargovind case does not appear to be justified for the contracts before the Judicial Committee and before this Court were different in their contents and this Court appears to have fallen into an error in assuming that they were similar. For instance, the contracts before the Privy Council were short term contracts while those before the Court in Chhotabhai case were for different periods including terms of five to even fifteen years. Apart from this, we have pointed out above the features which go to make the Bamboo Contract a benefit to arise out of land. These features were conspicuously absent in the contracts before the Court in Chhotabhai case. 109. The decision next in point of time on this aspect of the case is Ananda Behera v. State of Orissa. The petitioners in that case had obtained oral licences for catching and appropriating fish from specified sections of the Chilka Lake from its proprietor, the Raja of Parikud, on payment of large sums of money prior to the enactment of the Orissa Estates Abolition Act 1951. Under the said Act, the estates of the Raja of Parikud vested in the State of Orissa and the State refused to recognize the rights of the petitioners and was seeking to reauction the rights of fishery in the said lake. The petitioners, contending that the State had infringed or was about to infringe their fundamental rights under Articles 19(1)(f) and 31(1) of the Constitution of India, filed petitions in this Court under Article 32 of the Constitution. In their petition, the petitioners claimed that the transactions entered into by them were sales of future goods, namely, fish in the sections of the lake covered by the licences and that as fish was moveable property, the said Act was not attracted because it was confined to immovable property. The Court observed that if this contention of the petitioners was correct, then their petition under Article 32 was misconceived because until any fish was actually caught, the petitioners would not acquire any property in it. The Court held that what was sold to the petitioners was the right to catch and carry away fish in specific sections of the lake for a specified future period and that this amounted to a licence to enter on the land coupled with a grant to catch and 16 carry away the fish which right was a profit a prendre and in England it would be regarded as an interest in land because it was a right to take some profit of the soil for the use of the owner of the right and in India it would be regarded as a benefit arising out of the land and as such would be immovable property. The Court then pointed out that fish did not come under the category of property excluded from the definition of “immovable property”. The Court further held that if a profit a prendre is regarded as tangible immovable property, then the “property” being over Rs 100 in value, the document creating such right would require to be registered, and if it was intangible immovable property, then a registered instrument would be necessary whatever the value; but as in the case before the Court the sales were all oral and therefore, there being neither writing nor registration, the transactions passed no title or interest and accordingly the petitioners had no fundamental rights which they could enforce. Ananda Behera case was the first decision in which Chhotabhai case was distinguished. The relevant passage in the judgment (at pages 923-4) is as follows: “It is necessary to advert to Firm Chhotabhai Jethabai Patel & Co. v. State of M.P. and explain it because it was held there that a right to ‘pluck, collect and carry away’ tendu leaves does not give the owner of the right any proprietary interest in the land and so that sort of right was not an ‘encumbrance’ within the meaning of the Madhya Pradesh Abolition of Proprietary Rights Act. But the contract there was to ‘pluck, collect and carry away’ the leaves. The only kind of leaves that can be ‘plucked’ are those that are growing on trees and it is evident that there must be a fresh drop of leaves at periodic intervals. That would make it a growing crop and a growing crop is expressly exempted from the definition of ‘immovable property’ in the Transfer of Property Act. That case is distinguishable and does not apply here.” 110. The next decision which was cited and on which a considerable debate took place at the Bar was Shantabai v. State of Bombay [AIR 1958 SC 532]. The facts in that case were that by an unregistered document the petitioner’s husband had granted to her in consideration of a sum of Rs 20,000 the right to take and appropriate all kinds of wood from certain forests in his Zamindari. On the coming into force of the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, and Alienated Lands) Act, 1950, all proprietary rights in land vested in the State of Madhya Pradesh and the petitioner could no longer cut any wood. She thereupon applied to the Deputy Commissioner and obtained from him an order permitting her to work the forest and started cutting the trees. The Divisional Forest Officer took action against her and passed an order directing that the cut materials be forfeited. She made representations to the Government and they proving fruitless, she filed in this Court a petition under Article 32 of the Constitution of India alleging breach of her fundamental rights under Article 19(1)(f) and (g) of the Constitution. Four of the five learned Judges who heard the case pointed out that the foundation of the petitioner’s claim was an unregistered document and that it was not necessary to determine the true meaning and effect thereof for whatever construction be put on it, the petitioner could not complain of breach of any of her fundamental rights. The majority of the learned Judges held that if the document were considered as conveying to the petitioner any part or share in her husband’s proprietary right, no such part or share was conveyed to her as the document was not registered and assuming that any such part or share was conveyed, it had become vested in the State under Section 3 of the said Act; if the document were considered as a licence coupled with a grant, then the right acquired by the petitioner would be either in the nature of a profit a prendre which being an interest in land was immovable property and would require registration and as the document was not registered, it did not operate to transmit to her any such profit a prendre as held in  17 Ananda Behera case and if the document were construed as conferring a purely personal right under a contract, assuming without deciding that a contract was “property” within the meaning of Articles 19(1)(f) and 31(1) of the Constitution, she could not complain as the State had not acquired or taken possession of the contract which remained her property and as the State was not a party to the contract and claimed no benefit under it, the petitioner was free to sue the grantor upon that contract and recover damages by way of compensation; and assuming the State was also bound by the contract she could only seek to enforce the contract in the ordinary way and sue the State if so advised and claim whatever damages or compensation she might be entitled to for the alleged breach of it. After so holding the majority of the learned Judges observed (at page 269): “This aspect of the matter does not appear to have been brought to the notice of this Court when it decided the case of Chhotabhai Jethabai Patel and Co. v. State of M.P. and had it been so done, we have no doubt that case would not have been decided in the way it was done.” Unlike the majority of the Judges, Vivian Bose, J., in his separate judgment considered in detail the nature of the document in that case. Vivian Bose, J. pointed out the distinction between standing timber and a tree. We have earlier extracted those passages from the learned Judge’s judgment. The learned Judge then pointed out that the duration of the grant was for a period of twelve years and that it was evident that trees which would be fit for cutting twelve years later would not be fit for felling immediately and, therefore, the document was not a mere sale of trees as wood. Vivian Bose, J., held that the transaction was not just a right to cut a tree but also to derive a profit from the soil itself, in the shape of the nourishment in the soil that went into the tree and made it to grow till it was of a size and age fit for felling as timber and if already of that size, in order to enable it to continue to live till the petitioner chose to fell it. The learned Judge, therefore, held that though such trees as can be regarded as standing timber at the date of the document, both because of their size and girth and also because of the intention to fell at an early date would be moveable property for the purposes of the Transfer of Property Act and the Registration Act, the remaining trees that were covered by the grant would be immovable property and as the total value was Rs 26,000, the deed required registration and being unregistered, it did not pass any title or interest and, therefore, as in Ananda Behera case the petitioner had no fundamental right which she could enforce. 111. According to learned counsel for the appellant, the judgment of Vivian Bose, J., in that case was not the judgment of the Court since the other learned Judges expressly refrained from expressing any opinion as to the actual nature of the transaction under the document in question. Learned counsel submitted that what the Court really held in that case was that there was no breach of any fundamental right of the petitioner which would entitle her to approach this Court under Article 32 of the Constitution, and this decision was, therefore, not an authority for the proposition that a document of the type before the Court was a grant of a profit a prendre as held by Vivian Bose, J. It is true as contended by learned counsel that the majority expressly refrained from deciding the nature of the document because, as it pointed out, in any view of the matter, the petition would fail and it would, therefore, be difficult to say that what Vivian Bose, J., held was the decision of the Court as such. However, the judgment of Vivian Bose, J., is a closely reasoned one which carries instant conviction and cannot, therefore, be lightly brushed aside as learned counsel has attempted to do. It is also pertinent to note that the majority in that case pointed out the principal errors into which the Court had fallen in Chhotabhai case and disapproved of what was decided in that case. 18 112. The decision to which we must now advert is Mahadeo v. State of Bombay [AIR 1959 SC 735]. The facts in that case were that some proprietors of Zamindaris situate in territories, then belonging to the State of Madhya Pradesh and on the reorganisation of States transferred to the erstwhile State of Bombay, granted to the petitioners rights to take forest produce, mainly tendu leaves, from forests included in their Zamindaris. The agreements conveyed to the petitioners in addition to the tendu leaves other forest produce like timber, bamboos, etc., the soil for making bricks, and the right to build on and occupy land for the purpose of their business. In a number of cases, these rights were spread over many years. Some of the agreements were registered and the others unregistered. After the coming into force of the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, and Alienated Lands) Act, 1950, the Government disclaimed the agreements and auctioned the rights afresh, acting under Section 3 of the said Act. The petitioners thereupon filed petitions under Article 32 of the -Constitution of India challenging the legality of the action taken by the Government on the ground that it was an invasion of their fundamental rights. The main contention of the petitioners was that the agreements were in essence and effect licenses granted to them to cut, gather and carry away the produce in the shape of tendu leaves, or lac, or timber or wood, and did not grant to them any “interest in land” or “benefit to arise out of land” and the object of the agreements could, therefore, only be described as sale of goods as defined in the Indian Sale of Goods Act. In support of that contention, the petitioners relied upon the decision in Chhotabhai case. The Court examined the terms of the agreements in question and concluded that under none of them was there a naked right to take the leaves of tendu trees together with a right of ingress and of egress from the land but there were further benefits including the right to occupy the land, to erect buildings and to take other forest produce not necessarily standing timber, growing crop or grass. The Court further held that whether the right to the leaves could be regarded as a right to a growing crop had to be examined with reference to all the terms of the documents and all the rights conveyed thereunder and that if the right conveyed comprised more than the leaves of the trees, it would not be correct to refer to it as being in respect of growing crops simpliciter. On an examination of the terms of the documents and the rights conveyed thereunder the Court came to the conclusion that what was granted to the petitioners was an interest in immovable property which was a proprietary right within the meaning of the said Act and, therefore, it vested in the State. With reference to Chhotabhai case relied upon by the petitioners, Hidayatullah, J., as he then was, speaking for the Court, said (at page 346): “It is clear from the foregoing analysis of the decision in Chhotabhai case that on a construction of the documents there under consideration and adopting a principle enunciated by the Privy Council in Mohanlal Hargovind of Jabbulpore v. CIT, Central Provinces and Berar [AIR 1949 PC 311] and relying upon a passage each in Benjamin on Sale and the well-known treatise of Baden Powell, the Bench came to the conclusion that the documents there under consideration did not create any interest in land and did not constitute any grant of any proprietary interest in the estate but were merely contracts or licences given to the petitioners ‘to cut, gather and carry away the produce in the shape of tendu leaves, or lac, or timber or wood’. But then, it necessarily followed that the Act did not purport to affect the petitioners’’ rights under the contracts or licences. But what was the nature of those rights of the petitioners? It is plain, that if they were merely contractual rights, then as pointed out in the two later decisions, in Ananda Behera v. State of Orissa, Shantabai case, the State has not acquired or taken possession of those rights but has only declined to be bound by the agreements to which they were not a party. If, on the other hand, the petitioners were mere  19 licensees, then also, as pointed out in the second of the two cases cited, the licences came to an end on the extinction of the title of the licensors. In either case there was no question of the breach of any fundamental right of the petitioners which could support the petitions which were presented under Article 32 of the Constitution. It is this aspect of the matter which was not brought to the notice of the Court, and the resulting omission to advert to it has seriously impaired, if not completely nullified, the effect and weight of the decision in Chhotabhai case as a precedent.” We may also usefully reproduce the following passages (at page 354) from the concluding portion of the judgment; “From this, it is quite clear that forests and trees belonged to the proprietors, and they were items of proprietary rights.... If then the forests and the trees belonged to the proprietors as items in their ‘proprietary rights’, it is quite clear that these items of proprietary rights have been transferred to the petitioners.... being a ‘proprietary right’, it vests in the State under Sections 3 and 4 of the Act. The decision in Chhotabhai case treated these rights as bare licences, and it was apparently given per incuriam, and cannot therefore be followed.” 113. Faced with this decision, learned counsel for the appellant sought to distinguish it on the ground that the terms of the agreements in that case were different from the terms of the Bamboo Contract. We are unable to accept this submission. It is unnecessary to set out in detail the terms of the agreements in Mahadeo case. The differences sought to be pointed out by learned counsel for the appellant are unsubstantial and make no difference. The essential and basic features are the same and the same interpretation as was placed upon the agreements in Mahadeo case must, therefore, apply to the Bamboo Contract. 114. In State of M.P. v. Yakinuddin [AIR 1962 SC 1916] the respondents had entered into agreements with the former proprietors of certain estates in the State of Madhya Pradesh acquiring the right to propagate lac, collect tendu leaves and gather fruits and flowers of Mahua leaves. Some of these documents were registered and others unregistered. On the coming into force of the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1950, the State of Madhya Pradesh took possession of all the villages comprised in the respective estates of the proprietors who had granted the aforesaid rights to the respondents and refused to recognize the respondents’ rights. The respondents thereupon filed petitions under Article 226 of the Constitution in the High Court of Madhya Pradesh and the High Court relying upon the decision in Chhotabhai case, granted to the respondents the reliefs claimed by them. A Bench of five Judges of this Court allowed the appeals filed by the State of Madhya Pradesh. In its judgment, this Court considered its earlier decisions in Shantabai v. State of Bombay and Mahadeo v. State of Bombay and observed as follows: “In view of these considerations, it must be held that these cases are equally governed by the decisions aforesaid of this Court, which have overruled the earliest decision in the case of Chhotabhai Jethabai Patel and Co. v. State of M.P.” 115. In Board of Revenue v. A.M. Ansari [AIR 1976 SC 1813] the respondents were the highest bidders at an auction of forest produce, namely, timber, fuel, bamboos, minor forest produce, bidi leaves, tanning barks, parks, mohwa, etc., held by the Forest Department of the Government of Andhra Pradesh. They were called upon to pay in terms of the conditions of sale stamp duty on the 20 agreements to be executed by them as if these documents were leases of immovable property. The respondents thereupon filed petitions under Article 226 of Constitution in the High Court of Andhra Pradesh. In the said petitions, the State contended that under the agreements, the respondents had acquired an interest in immovable property. The High Court held in favour of the respondents. The State went in appeal to this Court. On a consideration of the terms of the agreements, this Court held that the agreements were licences and not leases. The Court laid emphasis upon three salient features of those agreements for reaching its conclusion, namely, (1) that these were agreements of short duration of nine to ten months, (2) that they did not create any estate or interest in the land, and (3) that they did not grant exclusive possession and control of the land to the respondents but merely granted to them the right to pluck, cut, carry away and appropriate the forest produce that might have been existing at the date of the agreement or which might have come into existence during the short period of the currency of the agreements, and that the right of the respondents to go on the land was only ancillary to the real purpose of the contract. The Court observed as follows: “Thus the acquisition by the respondents not being an interest in the soil but merely a right to cut the fructus naturales, we were clearly of the view that the agreements in question possessed the characteristics of licences and did not amount to leases so as to attract the applicability of Article 31(c) of the Stamp Act. The conclusion arrived at by us gains strength from the judgment of this Court in Firm Chhotabhai Jethabai Patel and Co. v. State of M.P. where contracts and agreements entered into by persons with the previous proprietors of certain estates and mahals in the State under which they acquired the right to pluck, collect and carry away tendu leaves, to cultivate, culture and acquire lac, and to cut and carry away teak and timber and miscellaneous species of trees called hardwood and bamboos were held in essence and effect to be licences. There is, of course, a judgment of this Court in Mahadeo v. State of Bombay where seemingly a somewhat different view was expressed but the facts of that case were quite distinguishable. In that case apart from the bare right to take the leaves of tendu trees, there were further benefits including the right to occupy the land, to erect buildings and to take away other forest produce not necessarily standing timber, growing crop or grass and the rights were spread over many years.” We fail to see how this authority in any way supports the case of the appellant before us or resuscitates the authority of Chhotabhai case. In Ansari case the Court seems to have assumed that Chhotabhai case dealt with short term contracts while, as we have seen above, most of the contracts in Chhotabhai case were of far greater duration extending even to fifteen years, nor was the Court’s attention drawn to the case of State of M.P. v. Yakinuddin. While the agreement in Ansari case was a mere right to enter upon the land and take away tendu leaves, etc., the right under the Bamboo Contract is of a wholly different nature. Further, the question whether the agreements were a grant of a profit a prendre or a benefit to arise out of land was not raised and, therefore, not considered in Ansari case and the only point which fell for decision by the Court was whether the agreements were licences or leases. In fact, another question which arose in that case was whether the respondents were liable to pay the amounts demanded from them as reimbursement of sales tax. Affirming the decision of the High Court on this point, the Court held that the Forest Department did not carry on any business by holding auctions of forest produce and was therefore, not a dealer within the meaning of that term as defined in the Andhra Pradesh General Sales Tax Act, 1957. The question whether the agreements were contracts of sale of goods was, however, not considered in that case.  21 116. We now come to the case of State of M.P. v. Orient Paper Mills Ltd. [AIR 1977 SC 687], the second of the two cases on which learned counsel for the appellant relied so strongly in support of his submission that the Bamboo Contract was a contract of sale of goods. The facts in that case as appearing from the judgment of the High Court reported as Orient Paper Mills Ltd. v. State of M.P. [(1971) Tax LR 1249] were that the President of India acting on behalf of the former Part C State of Vindhya Pradesh had entered into an agreement with the respondent The said agreement was a registered instrument and was styled as a lease and under it the respondent acquired the right for a period of twenty years with an option of renewal for a further period of twenty years to enter upon “the leased area” to fell, cut or extract bamboos and and salai wood and to remove, store and utilize the same for meeting the fuel requirement of its paper mill. A copy of the said agreement has been produced before us. Some of the terms of the said agreement were the same as those contained in the Bamboo Contract as also in the case of Mahadeo v. State of Bombay. The said agreement provided for payment of royalty including a minimum royalty. It also conferred upon the respondent the right to take on lease such suitable site or sites as were at the disposal of the State Government within “the leased area” for the erection of storehouses, sheds, depots, bungalows, staff offices, agencies and other buildings of a like nature bona fide required for the purposes of its business connected with the said agreement as also a right to make dams across streams, cut canals, make water-course, irrigation works, construct roads, railways and tramways and do any other work useful or necessary for the purposes of its business connected with the said agreement in or upon “the leased area” in terms very similar to those in the Bamboo Contract. After the the States Reorganization Act, 1956, came into force, the territories comprised in the State of Vindhya Pradesh became part of the new State of Madhya Pradesh. At the date when the said agreement was entered into the C.P. and Berar Sales Tax Act, 1947, was in force in the State of Vindhya Pradesh and the definition of ‘goods’ contained in clause (g) of Section 2 of that Act as modified and in force in that State excluded from the purview of the said Act forest contracts that gave a right to collect timber or wood or forest produce. The C.P. and Berar Sales Tax Act was repealed by the Madhya Pradesh General Sales Tax Act, 1958, with effect from April 1, 1959, and the new Act did not contain any exclusion of forest contracts from the definitions of “goods”. Further, the term “dealer” as defined in the 1958 Act included the Central Government and the State Government or any of its departments. The Forest Department of the State Government was, however, exempted from the payment of sales tax for the period April 1, 1959, to November 2, 1962. After the period of the said exemption expired, the Forest Department got itself registered as a dealer and the Divisional Forest Officer called upon the respondent to reimburse to him the amount which, according to him, he was liable to pay as sales tax in respect of the transaction covered by the said agreement. Challenging his right to do so, the respondent filed in the High Court of Madhya Pradesh a writ petition under Article 226 of the Constitution. In the said writ petition the respondent contended that the transaction covered by the said agreement was not a sale of goods and accordingly, no sales tax was payable in respect of bamboos and salai wood extracted by the respondent thereunder that the said agreement did not provide for the recovery of the amount of sales tax from the respondent, and that neither the State Government nor the Forest Department of that Government was a “dealer” and that even if the sales tax was payable it was not recoverable as arrears of land revenue. The High Court held that the transaction was one of sale of goods and that if sales tax was payable it would be recoverable under Section 64-A of the Sale of Goods Act, 1930, but the State Government or the Forest Department could not merely by selling the forest produce grown on its own land be regarded as carrying on any business of buying, selling, supplying or distributing goods and, therefore, in respect of mere sales of forest produce neither the State Government nor the Forest 22 Department was a “dealer” within the meaning of that term as defined in the 1958 Act. In coming to the conclusion that the said agreement was a contract of sale of goods, the High Court proceeded upon the basis that what it had to consider was “the stage when bamboo and salai wood have already been felled and appropriated”. By reason of the judgment of the High Court, the definition of the term ‘dealer’ was amended with retrospective effect by the Madhya Pradesh General Sales Tax (Amendment and Validation) Act, 1971, so as to nullify the finding of the High Court that neither the State Government nor its Forest Department was a ‘dealer’. The State of Madhya Pradesh as also the respondent came in appeal to the Supreme Court. The appeals were heard in the Court by a Division Bench of two learned Judges. At the hearing of the appeals, the respondent desired to challenge the vires of the amending Act, but in view of the Presidential Proclamation suspending the operation of Article 14, it could not do so and the Court held that after the proclamation lapsed, it was open to the respondent to take up the point but so far the appeals were concerned that challenge was not available and the appeals must be decided on the basis that the amendment was valid and constitutional. The main point before this Court, therefore, was whether the said agreement was a lease as it was styled or a simple sale of standing timber coupled with a licence to enter and do certain things on another’s land. The Court held that the label given to a document was not conclusive of its real nature and that under the said agreement, possession of the land was not given to the respondent as it would have been had the said agreement been a lease and that as the terms of the said agreement showed, it conferred in substance a right to cut and carry away timber of specified species and till the trees were cut, they remained the property of the owner, namely, the State, and that once the trees were severed, the property in them passed to the respondent. The Court further observed that the term used in the said agreement, namely, “royalty”, was “a feudalistic euphemism for the ‘price’ of the timber”. 1