No Private Settlements Can Override Tenancy Protections: Supreme Court Blocks Communidade’s Illegal Land Compromise

“Tenancy rights are creations of statute; they cannot be dissolved by private agreements masquerading as compromises”— In a judgment with significant implications for land rights in Goa, the Supreme Court of India delivered a strong rebuke to attempts by local landholding bodies to bypass protective tenancy statutes through private settlements. In the case of Communidade of Tivim, Tivim, Bardez, Goa v. State of Goa & Others, the Supreme Court upheld the rejection of a compromise arrangement where the Communidade had attempted to divide agricultural land with private tenants in a 60:40 ratio. The Court ruled such a compromise was illegal and violated both the Goa, Daman and Diu Agricultural Tenancy Act, 1964 and the Goa Land Use (Regulation) Act, 1991.

Justice Sudhanshu Dhulia, delivering the lead judgment, observed that any arrangement which “has the effect of circumventing the statutory safeguards put in place to protect tenancy rights is nothing but an abuse of the process of law and cannot be permitted.”

Communidade’s Bid to Sidestep Tenancy Law Fails

The case arose from a long-standing land dispute concerning two agricultural properties in the village of Tivim, Bardez. The land belonged to the Communidade of Tivim, a traditional Goan institution managing village properties. These properties were leased to the predecessors-in-interest of the private respondents in 1978. After securing a decree in 1986 recognizing tenancy rights, and subsequent recognition through a tenancy application in 2017, the private respondents were declared tenants by the Trial Court.

Faced with the prospect of losing control over the land, the Communidade convened meetings proposing a ‘compromise’—a division of land with 60% going to the tenants, granting them full ownership, and 40% retained by the Communidade, freed from tenancy claims. This private settlement was rejected by the Administrative Tribunal under Article 154(3) of the Code of Comunidades, and the High Court upheld this refusal. The Communidade approached the Supreme Court, contending that its internal resolutions represented the will of its members and should have been respected.

 “You Cannot Override Statutes with Private Settlements”

Rejecting the Communidade’s appeal, the Supreme Court firmly stated, “No Communidade, no individual, and no private group can by-pass the scheme of agrarian reform embedded in the Tenancy Act and Land Use Act under the guise of a compromise.”

The Court meticulously analysed the legal architecture of the Tenancy Act, observing, “Section 9 of the Tenancy Act permits termination of tenancy only through limited statutory channels—by surrender under Section 10, by termination on enumerated grounds under Section 11, or by other provisions of the Act. Private settlements attempting to bypass these routes are plainly impermissible.”

The Court was particularly critical of the terms of compromise which proposed that tenants would gain “all rights akin to full ownership rights” over the land, and would be allowed to use it “for any purpose whatsoever,” while the Communidade would similarly hold its share “free from any tenancy claim.”

The Court categorically held, “Such clauses are nothing but a blatant attempt to extinguish tenancy rights without due process, and to convert agricultural land into non-agricultural land in complete violation of the statutory regime.”

“Ownership Rights Flow from Law, Not From Private Bargains”—Supreme Court on Deemed Purchases

The judgment sharply distinguished between ownership rights derived under statutory processes and those created through unauthorized settlements. “The Tenancy Act provides a meticulously detailed mechanism for tenants to be deemed purchasers under Chapter IIA, subject to determination of purchase price and oversight by the Mamlatdar,” the Court said.

It added, “To allow a private compromise to circumvent these checks would be to dismantle the entire legal edifice of land reform in Goa.”

Justice Dhulia observed that even where a tenant is allowed to purchase land under the Tenancy Act, the Goa Land Use Act imposes further restrictions, stating, “The law is clear—no land vested in a tenant can be used for any purpose other than agriculture. This safeguard is non-negotiable.”

“Communidade Cannot Use Article 30(4)(g) to Sanction Illegal Compromises”—Supreme Court Clarifies Limited Powers

Addressing the Communidade’s argument that Article 30(4)(g) of the Code allowed them to negotiate compromises, the Court issued a stern clarification, stating, “This provision only empowers the Communidade to deliberate upon compromises, but the final word rests with the Administrative Tribunal, which is duty-bound to ensure that any settlement is in consonance with the law.”

The judgment categorically declared, “Deliberative power is not a license to subvert statutory rights. The Administrative Tribunal rightly refused to validate an agreement which tramples upon protected tenancy rights and land use restrictions.”

Court Denounces the Abuse of Compromise Mechanism to Evade Land Laws

Affirming the orders of the Administrative Tribunal and the High Court, the Supreme Court dismissed the appeal of the Communidade of Tivim. The Court concluded that “the attempted compromise was nothing short of a legal sleight-of-hand designed to defeat legislative intent.”

The Court further clarified, “We have consciously refrained from expressing any view on the merits of the tenancy appeal pending before the Appellate Court. The rights and claims of parties will be adjudicated strictly in accordance with law, not through collusive settlements.”

With this ruling, the Supreme Court has reinforced that tenancy protections in Goa are sacrosanct and cannot be diluted by private arrangements. The ruling reiterates that statutory land reforms cannot be undone by local resolutions, ensuring that the agrarian character of Goa’s rural landscape remains intact.

Date of Decision: 14th July 2025