Bombay High Court Allows Tenant's Petition in Tenancy Dispute Over Delayed Payment of Purchase Price. Belated payment with interest and penalty before landlord's application does not render sale ineffective under Bombay Tenancy and Agricultural Lands Act, 1948.

Writ petition under Article 227 of the Constitution challenging the order of the Maharashtra Revenue Tribunal which declared the sale of agricultural land to tenants ineffective due to delayed payment of purchase price.

The petitioners (tenants) sought quashing of the MRT order and restoration of the ALT and SDO orders which had rejected the landlord's application for declaration of ineffective sale.

The respondent landlord filed an application before the ALT seeking declaration that the sale of suit land to the petitioners was ineffective because they failed to pay the purchase price within the stipulated period.

The ALT rejected the landlord's application on 3rd July 1992. The SDO dismissed the landlord's appeal on 30th May 1995. The MRT allowed the landlord's revision on 12th October 1999, setting aside the ALT and SDO orders and declaring the sale ineffective.

Whether the sale of agricultural land to a tenant under Section 32G of the BTAL Act becomes ineffective if the tenant pays the purchase price belatedly, after the stipulated period, but before the landlord files an application for declaration of ineffective sale. Whether the MRT was justified in setting aside the orders of the ALT and SDO and declaring the sale ineffective.

The petitioners argued that they had paid the entire purchase price with interest and penalty on 30th September 1988, before the landlord filed the application on 1st August 1990, and that they were in possession on the tillers' day, so the sale cannot be declared ineffective. The respondent argued that the petitioners failed to pay the purchase price within the stipulated period and therefore the sale should be declared ineffective.

Under the Bombay Tenancy and Agricultural Lands Act, 1948, the sale of agricultural land to a tenant is not rendered ineffective merely because the tenant pays the purchase price belatedly, provided the tenant pays the full amount with interest and penalty before the landlord files an application for declaration of ineffective sale. The purpose of the Act is to protect tenants and confer ownership on them, and belated payment with interest does not defeat the sale if the tenant was in possession on the tillers' day.

The record indicates that, the Petitioners were declared tenants under the provisions of the B.T.A.L. Act with respect to the Suit land... Thus, it is an admitted fact on record that, though belatedly, the Petitioners paid the purchase price fixed by the ALT Malshiras, pertaining to the suit land. The purpose of the Act is to protect tenants and confer ownership on them. Since the tenant was in possession on the tillers' day and had paid the full amount with interest, the sale cannot be declared ineffective merely because of delayed payment.

The ALT conducted an enquiry under Section 32G in 1968 and directed the petitioners to pay the purchase price in installments between 1968 and 1974. The petitioners paid the amount with interest and penalty on 30th September 1988. On 1st August 1990, the respondent filed an application before the ALT seeking declaration of ineffective sale. The ALT rejected the application on 3rd July 1992. The respondent appealed to the SDO, who dismissed the appeal on 30th May 1995. The respondent then filed a revision before the MRT, which allowed the revision on 12th October 1999, setting aside the ALT and SDO orders. The petitioners challenged the MRT order before the Bombay High Court by way of Writ Petition No. 816 of 2000, which was allowed on 29th July 2019.

• Bombay Tenancy and Agricultural Lands Act, 1948: 32G, 32M, 32P
• Constitution of India: Article 227