Bombay High Court Restores Buyers’ Challenge to Agricultural Tenancy Orders; Holds Registered Agreement Holders Who Paid Full Consideration Have Sufficient Interest Despite Lacking Ownership
Bombay High Court Quashes Agricultural Tenancy Orders; Holds Agreement-for-Sale Buyers With Substantial Property Interest Are Persons Aggrieved and Entitled to Challenge Proceedings
Facts
The dispute concerned agricultural land bearing old Survey No. 16/4, now Gat No. 219/4, situated at Village Shirdhon, Taluka Panvel, District Raigad. Ganesh Sadashiv Oze was the original landlord. The predecessor of the persons claiming tenancy rights had initiated proceedings under Section 32-G of the Bombay Tenancy and Agricultural Lands Act, 1948 in 1964. Those proceedings were postponed because the landlady was a widow.
The petitioners, Naresh Kesarimal Mehta and another, subsequently claimed rights in the property on the basis of a registered Agreement for Sale dated 29 May 2007 and a Power of Attorney. Their case was that the agreed consideration was ₹1.60 crore, of which ₹80 lakh was paid to Shardabai Ganesh Oze and the remaining ₹80 lakh to the confirming party, Wahid Hussain Shaikh. They also instituted Special Civil Suit No. 329 of 2012 for enforcement of their contractual rights.
Meanwhile, proceedings under Section 32-G were pursued by persons claiming tenancy rights. On 22 February 2011, the A.L.T., Panvel fixed the purchase price in favour of Respondent Nos. 2 to 13. That order was upheld by the Sub-Divisional Officer.
The petitioners challenged these tenancy orders before the Maharashtra Revenue Tribunal. Their revisions were ultimately rejected, principally raising the issue whether persons claiming merely through an Agreement for Sale, without perfected ownership or a decree for specific performance, had sufficient locus to challenge tenancy proceedings.
The petitioners therefore approached the Bombay High Court through Writ Petition Nos. 12947 of 2016 and 6409 of 2018.
Issues
The principal issues before the High Court were:
- Whether purchasers under a registered Agreement for Sale, who claimed to have paid the entire consideration but had not yet obtained title or a decree for specific performance, had locus standi to challenge orders under Section 32-G.
- Whether only an absolute owner could qualify as a “person aggrieved” in proceedings affecting agricultural land.
- Whether Section 64 of the Tenancy Act barred the petitioners from asserting sufficient legal interest in the property.
- Whether the A.L.T. and S.D.O. had properly examined the earlier Section 32-G proceedings, revenue entries, authority of Power of Attorney holders, notices and the legal entitlement of the persons claiming tenancy rights.
- Whether the Maharashtra Revenue Tribunal was justified in rejecting the petitioners’ revisions without properly considering their contractual interest and alleged prejudice.
Petitioners’ Arguments
The petitioners argued that they had a direct and substantial interest in the disputed property arising from the registered Agreement for Sale and payment of the entire ₹1.60 crore consideration.
They contended that their civil suit for enforcement of the agreement was pending and that the Civil Court had already directed maintenance of status quo concerning the property.
Accordingly, the orders declaring other persons entitled to purchase the same property under Section 32-G directly prejudiced their contractual rights.
They further challenged the validity of the original tenancy proceedings on several grounds, including the authority of the Power of Attorney holders who had represented the parties, alleged revocation of those powers, failure to consider earlier tenancy proceedings and revenue records, and failure to afford a proper hearing.
In Writ Petition No. 6409 of 2018, it was additionally argued that when the Section 32-G order had already been stayed by the Revisional Authority, permission under Section 43 could not thereafter have been granted.
The petitioners maintained that perfected ownership was not necessary to establish locus. Their registered agreement, payment of consideration and pending specific performance proceedings were sufficient to show that they were persons prejudicially affected by the tenancy orders.
Respondents’ Arguments
The respondents contended that the petitioners were not parties to the original tenancy proceedings and had no vested ownership rights.
They relied particularly upon Section 64 of the Tenancy Act, arguing that where agricultural land is proposed to be sold, the statutory procedure requires determination of a reasonable price and preferential offer to the tenant in actual possession.
A sale contrary to Section 64 is invalid.
Accordingly, they argued that an Agreement for Sale by itself could not confer any legal right upon the petitioners to interfere with proceedings under Section 32-G.
They further contended that unless and until the petitioners succeeded in their pending suit and obtained a decree for specific performance, they could not claim to be “persons aggrieved” by the tenancy orders.
Analysis of the Law
The High Court drew an important distinction between ownership of property and sufficient legal interest to challenge an order affecting that property.
The Court accepted that an Agreement for Sale does not make the purchaser the owner and does not confer all the rights available to an owner.
However, ownership was not the issue while determining locus.
The correct question was whether the petitioners possessed a legally recognisable interest and whether the impugned tenancy orders were capable of causing prejudice to that interest.
The Court found that the petitioners’ registered Agreement for Sale, alleged payment of the entire consideration, Power of Attorney, pending civil suit and subsisting status quo order, when considered cumulatively, constituted an existing and substantial interest in the property.
The Section 32-G orders dealt with precisely the same land and were therefore capable of prejudicing that interest.
Section 64 did not destroy locus
The Court also rejected the argument that Section 64 automatically deprived the petitioners of locus.
Section 64 governs the procedure for sale of agricultural land and the consequences of non-compliance. But the Court found nothing in that provision declaring that a person holding an Agreement for Sale could never challenge an order under Section 32-G.
Whether the agreement was ultimately valid and enforceable was a matter for the competent Civil Court. That issue was distinct from whether the petitioners were prejudicially affected by the tenancy orders.
Precedent Analysis
1. Adi Pherozshah Gandhi v. H.M. Seervai, (1970) 2 SCC 484
The Supreme Court explained that a person is “aggrieved” where an order operates to his detriment or causes pecuniary or other prejudice.
The Bombay High Court applied this principle to hold that the decisive factor is actual prejudice to a legally recognisable interest, rather than formal ownership.
2. Baldev Singh v. Surinder Mohan Sharma, (2003) 1 SCC 34
The Supreme Court held that a person aggrieved must be one whose right is affected by the judgment or decree sought to be challenged.
The High Court held that this principle could not be interpreted to mean that only an absolute owner can challenge an order concerning property.
3. A. Subash Babu v. State of A.P., (2011) 7 SCC 616
The Supreme Court characterised the expression “aggrieved person” as an elastic concept, whose scope depends upon the statutory context, nature of the person’s interest and extent of prejudice suffered.
The High Court therefore examined the petitioners’ actual transaction, consideration paid, pending civil litigation and impact of the tenancy orders rather than applying a rigid ownership test.
4. Smt. Jatan Kumar Golcha v. Golcha Properties Pvt. Ltd., (1970) 3 SCC 573
The High Court relied upon the principle that even a person who was not originally a party to proceedings may, in an appropriate case, challenge an order where that person is prejudicially affected.
Accordingly, the fact that the petitioners were strangers to the original tenancy proceedings was not by itself sufficient to deny locus.
Court’s Reasoning
The Court held that requiring the petitioners to first obtain a decree for specific performance would be incorrect.
Their civil suit concerned the same property. If the Section 32-G orders were allowed to operate without considering their interest, those orders could affect the very property forming the subject matter of the pending civil suit.
The Court therefore held:
- an Agreement for Sale does not make the petitioners owners;
- nevertheless, ownership is not the sole test for determining whether a person is aggrieved;
- their registered agreement, payment of consideration, pending civil suit and status quo order demonstrated sufficient interest;
- the tenancy orders were capable of prejudicially affecting that interest; and
- therefore, the petitioners had locus to challenge them.
The Court also found serious deficiencies requiring reconsideration in the underlying tenancy proceedings.
Questions relating to earlier Section 32-G proceedings, revenue entries, validity and revocation of Powers of Attorney, notices to parties and the manner in which the purchase price was fixed went to the root of the proceedings.
Importantly, the Court observed that mere filing of an application under Section 32-G did not establish that the applicants were legally entitled to purchase the land. The tenancy authority was first required to determine their legal entitlement.
The A.L.T. and S.D.O. orders could therefore not be allowed to stand without proper examination of these issues.
Conclusion
The Bombay High Court held that the petitioners had established sufficient locus to challenge the tenancy proceedings even though their Agreement for Sale had not yet culminated in ownership.
Accordingly, both Writ Petitions were allowed.
The Court:
- quashed the Maharashtra Revenue Tribunal’s orders dated 29 March 2016 and 7 March 2017;
- consequently quashed the orders of the A.L.T., Panvel and S.D.O., Panvel;
- restored Revision Application Nos. 147 and 223 of 2014 to the Maharashtra Revenue Tribunal;
- directed the MRT to give an effective hearing to all necessary parties and decide the revisions afresh on merits; and
- directed the MRT to endeavour to dispose of the restored revisions within six months.
Crucially, the High Court did not declare the petitioners owners, did not uphold the validity or enforceability of their Agreement for Sale, and did not decide their entitlement to specific performance. Those questions were expressly left open for determination by the Civil Court.
Case Details
Case: Naresh Kesarimal Mehta & Anr. v. Shardabai Ganesh Oze (Since Deceased Through LRs.) & Ors.
Court: High Court of Judicature at Bombay, Civil Appellate Jurisdiction
Case Numbers: Writ Petition No. 12947 of 2016 with Writ Petition No. 6409 of 2018
Judge: Justice Amit Borkar
Reserved on: 24 August 2026
Date of Judgment: 31 August 2026
Result: Both Writ Petitions allowed; MRT, A.L.T. and S.D.O. orders quashed; Revision Application Nos. 147 and 223 of 2014 restored to the Maharashtra Revenue Tribunal for fresh consideration. Petitioners’ locus recognised, while ownership and enforceability of the Agreement for Sale were expressly left open.
