Ananta Lal vs Bibhuti Bhusan

Manohar Lall, J.—This is an application in revision on behalf of a plaintiff whose suit for recovery on rent has been dismissed by the Small Cause Court Judge in the circumstances about to be narrated. The principal questions for consideration are whether the relationship of landlord and tenant has been established between the parties and whether the suit was cognizable by the revenue Court only. The case of the plaintiff is that he instituted title Suit No. 43 of 1937 in the Court of the Munsif of Raghunathpur for recovery on khas possession of a tank recorded in plots Nos. 2196 and 2197 of garabad khata No. 6 of village Barrah. The defendant alleged that he was in possession of the admitted tenancy lands including the tank on the foot of a registered patta dated 18th February 1934, by which he was liable to pay only mukarrari rent of Rs. 3 per annum which could not be enhanced and, therefore, he resisted that suit. The plaintiff had also claimed in that suit the alternative relief that he was entitled to the fishes over and above the annual rent if it is held that the tank was a part of the land which was leased with the defendant. The parties came to terms which were embodied in a petition of compromise, which, after stating the facts which I have narrated above, stated that "it is settled in this way that as long as the plaintiff would possess the share of mouza Barrah the defendant and hia heirs would pay from 1343 B.S., one maund and ten soars of fish the price of which is Rs. 12 over and above the mokarari rentof Rs. 3. But if the plaintiff or his heirs transfer the said share of mouza by sale or gift or for some other reason his or his heir''s interest is extinguished, the defendant with his heirs shall not be bound to pay the aforesaid fish and the fish or its price will not be regarded as the rent of the properties mentioned in the above mentioned patta.

The terms of this compromise were embodied in the decree by which the suit was disposed of; but neither the compromise petition nor the decree was registered. The plaintiff then instituted suit No. 162 of 1942 giving rise to this revision in the Court of the Munsif of Raghunathpur exercising Small Cause Court powers for the recovery of price of five maunds of fish at the rate of Rs. 12-8-0 per year together with interest at the rate of 12 per cent, per annum, that is to say, he is claiming price of fish for four years. The defence to the action was that the tank formed part of the defendant''s agricultural tenancy for which he was liable to pay a consolidated sum of Rs. 3 per annum, and that the compromise was nothing more than a device to obtain an enhancement of rent of the tenancy and, therefore, was not enforceable in law and also on the ground that it was not registered.

The learned Small Cause Court Judge held that the term of the compromise by which the defendant agreed to deliver or pay for the fish was merely a personal covenant by a tenant and could not be enforced as it was hit by the provisions of Section 63, Chota Nagpur Tenancy Act. He also held that even if the stipulation is considered to be a lawful praedial condition not prohibited by Section 63, Chota Nagpur Tenancy Act, the remedy of the plaintiff was in a revenue Court and not in a civil Court. Accordingly he dismissed the suit. In support of the application Mr. R.S. Chatterji argued that the learned Subordinate Judge was wrong in holding that the agreement to deliver or pay for the price of fish was a praedial condition, because the agreement between the parties was a bona fide settlement of a dispute which was the subject of Title Suit No. 43 of 1937.

He further argued that as this stipulation was merely a personal covenant, the plaintiff rightly invoked the jurisdiction of the civil Court. Mr. Mazumdar, who appeared for the respondent, strenuously argued that the terms of the compromise cannot be looked at for two reasons firstly, because neither the petition of compromise nor the decree embodying it was registered, and, secondly, because this was a patent device to enhance the rent of the tenancy. He also argued that the agreement to pay for the price of fish was really an agreement to pay rent, and therefore the remedy of the plaintiff was to go to the revenue Court.

It was held by a Special Bench of this Court in Akaran Baid v. Deolal Singh AIR 1929 Pat. 568 that a suit in ejectment based on trespass does not become a suit between landlord and tenant by reason only of the fact that an alternative relief for the assessment of fair and equitable rent was sought for in the plaint, and that a settlement between the parties arrived at in such a suit was a bona fide settlement to end the litigation between the parties and that the agreement by which the original rent is enhanced beyond the limits fixed by Section 29, Bengal Tenancy Act, is in these circumstances, perfectly valid and enforceable and does not come within the mischief of that section. This decision applies to the facts of this case, and I must hold that the agreement to pay Rs. 12 per annum over and above Rs. 3 fixed under the original contract of settlement is binding upon the defendant as by it a bona fide dispute between the parties was settled. (In view of this conclusion his Lordship thought that it was unnecessary to examine the argument presented by Mr. Mazumdar to show that notwithstanding the agreement between the parties having been embodied in the compromise decree, it was open to him to show in a collateral proceeding that the compromise was a mere device to get rid of the imperative terms of the statute.)

Another serious argument advanced by Mr. Mazumdar was that the compromise decree being unregistered could not be treated as evidence in this case. His argument was that as the compromise alters the rent payable for the existing tenancy covered by a registered instrument, the new rent payable must itself be evidenced by a registered document, either by an ordinary document inter partes or by a registered decree of the Court founded on such, an agreement between the parties. He relies on a number of cases. By Section 17(2), Registration Act, it is provided that nothing in Clauses (b) and (c) of Sub-section (1) applies to any decree or order of a Court except a decree or order expressed to be made on a compromise and comprising immovable property other than that which is the subject-matter of the suit or proceeding. It will be noticed that Sub-clause (d) to Sub-section (1) which concerns with leases of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent, is not mentioned in Sub-clause (2)(vi) of the section. It must therefore follow that a decree or order of a Court which embodies a compromise between the parties is admissible in evidence even if it is not registered provided it does not amount to a lease within the meaning of Sub-clause. (d) of Sub-section (1). It was therefore strenuously argued by Mr. Mazumdar that a document of a compromise which varies the terms of an existing lease must be taken to be in essence a lease, and so requires registration. But the cases cited do not support him.

In Durga Prasad v. Rajendra Narin (''10) 37 Cal. 293 it was decided that an agreement which affects the incidents of the tenure created by a leasse, or in other words, which forms a part of the terms of the holding under the lease, is not admissible without registration. The terms of the lease in that case were sought to be altered by a letter. This case went up to the Privy Council where Sir John Edge, who delivered the judgment of the Board in Durga Prasad v. Ranjendra Narayan (''13) 40 I.A. 223 observed as follows at page 230: "The High Court found that the document by which the defendants sought to prove that Baja Jaimangal Singh had agreed to reduce the rent from Rs. 2800 to Rs. 2000 a year was, for want of registration, inadmissible in evidence to vary the terms of the kabuliyat, and that the alleged agreement for reduction of rent was without consideration and was not enforceable. On both points their Lordships agree with these findings of the High Court," though the decision of the High Court was reversed in part on other grounds. It will be noticed that no question of registration of a decree was involved. The correction of this decision on the question of registration was referred to a Full Bench of the Calcutta High Court decided in Lalit Mohan v. Golali Chuck Coal Co. (1912) 39 Cal. 284 (F.B.). The questions referred to the Full Bench were: "(1) Has the case in Durga Prasad v. Rajendra Narin (1910) 37 Cal. 293 been correctly decided in so far as it determines that a document, though not amounting to a lease, requires registration if it be an agreement for reduction of rent under a previously existing registered lease? (2) Does a document which is not a lease, but which varies the amount of rent to be paid under an existing registered lease as also the incidents of such payments, namely, the date of payment and consequences of default of payment, require registration?" The Full Bench decided that the case in Durga Prasad v. Rajendra Narin (1910) 37 Cal. 293 has been correctly decided and that a document which varies the amount of rent to be paid under an existing lease requires registration. It will be noticed that the questions referred to the Full Bench assume the proposition that a document may not be a lease although it may vary the amount of rent to be paid under an existing lease. (His Lordship then carefully considered the cases in Begha v. Ram Lakhan AIR 1918 Cal. 807 , Sarat Chandra Das alias Sachidananda Das Vs. Sm. Sarajini Rudraja, Jogesh Chandra Mukherjee Vs. Rai Beharilal Mitra Bahadur and Others, , Bibhuti Bhusan Pal Chaudhury and Others Vs. Sm. Maya Deby and Another, , and Attar Chandra v. Chandu Lal AIR 1929 Lah. 291 and after explaining and distinguishing them proceeded.) I now come to the Patna cases which have consistently taken the view put forward by Mr. Chatterji.

In Charu Chandra Mitra Vs. Sambhu Nath Pandey and Others, the argument advanced was that a certain compromise was not admissible in evidence because it was not registered. The argument is reproduced by Atkinson J. at p. 270 showing that the question for decision was whether upon a proper construction of the compromise it fell within the provisions of Clause (d) of Section 17(1). The learned Judge, therefore, had to construe whether the compromise was a lease and observed as follows: I am reading from the bottom of p. 270: "It becomes necessary to consider whether the compromise dated 10th March 1902, was a lease; bearing in mind that what the compromise purported to effect was to alter only one single provision contained in that lease of 1895, namely, to regulate the amount of rent which, was to be paid henceforth during the continuation of the lease. It did not deal with-anything else; and, reading the compromise alone, as my learned brother pointed out to-day, could it be contended taking the compromise as it stands, that it constituted a lease in all of the essential elements of a lease contemplated by Section 105, T.P. Act? To ask the question is to answer it; this compromise obviously per se could not constitute a lease." At p. 272 the learned Judge referring to the case in Durga Prasad v. Ranjendra Narayan (1913) 40 I.A. 223 observed: "I take these general words and observations to mean that their Lordships of the Privy Council approved of the decision of the High Court so far as that decision decided that n registered lease must be varied by a registered document; but that such a document varying a written registered instrument is a non-testamentary document of the class provided for within the purview of Clause (b) of Sub-section (1) of Section 17, Registration Act. That being the true legal position, this document, the compromise of 1901, if it required registration would be registrable under Clause (b), Sub-section (1) of Section 17, Registration Act. Now the proviso contained in Sub-section (2) of Section 17 expressly provides that nothing in Clause (b) and (e) shall apply to any decree or order of a Court or any award." The learned Judge then referred to another Privy Council case, Bindesri v. Ganga Saran (1998) 20 All. 117, and the extended interpretation of this case given in the Madras High Court in Natesa v. Vengu (1910) 33 Mad. 102, but he guarded himself with these observations at p. 274: "We wish it to be clearly understood for the purposes of our decision in this case that we do not consider that the decision of their Lordships of the Privy Council is wide enough to cover the case of a document constituting a lease arising out of a compromise in a judicial proceeding within the provisions of Clause (d) of Sub-section (1) of Section 17, Registration Act. We think it applies to documents coming within the class of documents contemplated in Clause (b) and (C) which are protected under the provisions of Clause (vi) of Sub-section (2) of Section 17, Registration Act, from registration."

In Rampadarath v. Soharai Koeri AIR 1920 Pat. 602 it was decided that a compromise in a suit between the landlord and tenant by which the terms of the contract under which the tenant is holding are altered is not a lease within Section 17 (d), Registration Act, but comes within the the category of the documents described in Clause (b) and (c) of that section. In construing the particular compromise Mullick J. observed at p. 672: "Now we have very carefully read the terms of the compromise petition, and we do not find that it contains any of the ingredients necessary for a lease. No transfer of any interest in land is effected by the document. All that it does is to change the terms of the contract under which the tenant was already holding, and it clearly comes within the category of the documents described in Clauses (b) and (c) of Section 17, Registration Act." Jwala Prasad J. who concurred also observed: "The said compromise petition was incorporated into the decree of the Court and as such was exempted from registration u/s 2, Clauses (vi) of Section 17, Registration Act, inasmuch as the terms in question in the compromise did not amount to a lease under Clause (d) of Sub-section (1) of the said section, but came under Clauses (b) and (c) of Sub-section (1). A decree or order of a Court embodying the terms of an instrument coming under clause (b) or Clause (c) is exempted from registration. Only gifts under Clause (a) and leases under Clause (d) of Sub-section (1) are not so exempted." In reply to these decisions Mr. Mazumdar relies upon the case in Sachindra v. Ramjash AIR 1932 Pat. 97. The head-note of the case does not support him at all. It decides (1) that, all decrees and orders are not excluded from compulsory registration u/s 17(2)(vi), but only those are excluded which partake the character of the documents mentioned in Clauses (b) and (c) of Sub-section (1)(2) that a decree embodying a compromise purporting to grant a lease within the meaning of clause (d) of Sub-section (1) is not exempt from registration. Fazl Ali J. (as he then was) pointed out at p. 101 that the answer to the question whether a compromise decree was inadmissible in evidence for want of registration depended not only on the prqper construction of Section 17, Registration Act, but also on the construction of the decree itself so as to determine whether it operated to create a lease or not. He referred to the observations of Lord Buckmaster in the well-known case in Hemanta Kumari v. Midnapore Zamindari Co AIR 1919 P.C. 79 that: "If the document in question can be regarded as a lease within the meaning of this definition it cannot be received in evidence. Their Lordships are of opinion that it cannot be so regarded. By Section 17(1)(b), however, it is also provided that other non-testamentary instruments which purport or operate to create, whether in present or in future, any right, title or interest vested or contingent, of the value of Rs. 100 and upwards, to or in immovable property, need registration. But this is subject to the exception provided in Sub-section (2) of Section 17 which states that ''nothing in Clauses (b) and (c) of Sub-section (1) applies to, among other things, ''any decree or order of a Court.'' If, therefore, the decree in the present case can be regarded as a decree within the meaning of that exception, there is nothing in the Registration Act to affect the matter." The learned Judge then elaborately went on to deal with a large number of cases which have clustered round this question and approved of the decision and the line of reasoning in Rampadarath v. Soharai Koeri AIR 1920 Pat. 602. This case therefore does not help Mr. Mazumdar.

Mr. Chatterji also drew attention to a decision of a Single Judge of this Court reported in Shaila Bala Devi v. Ganga Narayan Bhakat AIR 1933 Pat. 457 where Dhavle J. had to consider a similar question. At p. 459 he observes: "That a compromise which substantially creates a lease does require registration is rented on the decision in Lalit Mohan v. Golali Chuck Coal Co. (1912) 39 Cal. 284 (F.B.) decided in this Court on 2nd June last in which Fazl Ali J. elaborately examined the previous authorities and held that such a compromise was inadmissible, in the absence or registration, not only for proving a lease but also for what was claimed before him to be the collateral purpose of proving the amount of rent fixed by the compromise. Sachindra v. Ramjash AIR 1932 Pat. 97, however, is easily distinguishable as a case where the compromise created a lease. In the present case Keshab was the lessee of the holding from before and the compromise merely varied or defined some terms of the tenancy. In Rampadarath v. Soharai Koeri AIR 1920 Pat. 602, Mullick and Twain Prasad JJ., held that a compromise in a rent suit which fixed the area and rent and changed the status of the defendant from an occupancy raiyat to a raiyat at a fixed rent, did not affect any transfer of interest and was, therefore, not a lease, but came within Clauses (b) and (c) of Sub-section (1) of Section 17, Registration Act, with the result that where the compromise became part of the decree, registration became unnecessary by reason of clause, namely, of Sub-section (2) of the section. A similar view was taken in Jaynal Abedin and Others Vs. Hyder Ali Khan Pani, where by the compromise the darpatnidar defendant relinquished all claims in one of several mauzas demised and the rent payable to the patnidar plaintiff was reduced accordingly." The result of the view of the cases cited at the Bar may be stated thus: (1) Where the rent of an existing tenancy created by a registered document is varied by a non-testamentary document it must be registered, but it need not be registered if the document is in the form of a compromise which is embodied in the decree of a Court provided it does not relate to a matter beyond the scope of the suit as provided by the amended Act (of 1929. But where such a document itself creates a lease, it requires registration even though it has been embodied in a decree of the Court. (2) Each case must be decided on its own facts by construing the particular document in question and the main test will be whether the document evidences a present demise. For these reasons I would overrule the contention raised by Mr. Mazumdar.

It remains to deal with the contention that the suit was cognisable by a Court of Small Causes. In Subramanian v. Arunachalam (1902) 29 I.A. 138 (P.C.) the facts were as follows: The Raja of Ramnad executed a reversionary lease of a portion of hiszamindari in favour of Ramasamy Chettiarin 1895. The lease recited that there were subsisting leases affecting the properties demised, some of which would not expire till the year 1318 Fasli corresponding to 1911. Accordingly the new lease was made to commence with the Fasli year 1319. It was a perpetual lease, the annual rent was fixed, its recovery was provided for and the rights and obligations of both parties were defined. During the negotiations for the lease it was agreed between the Raja and the lessee that in consideration of his obtaining the lease, the lessee should pay to the Raja a sum of Rs. 500 a month for a period of ten years from July 1895. This was entered in a letter addressed to the lessor by the lessee. Ramasamy not having paid anything in spite of his agreement the Raja on 9th December 1895 assigned that agreement for value of Ramanadhan Chettiar, and notice of this assignment was at once given to Ramasamy. On 21st September 1897, a sviit was filed by Ramanadhan against Ramasamy for the recovery of twenty-six monthly instalments at the rate of Rupees 500 a month with interest. One of the defences raised was that the agreement to pay Rs. 500 a month was void in law as not being in writing registered, and reliance was placed upon Section 92, Evidence Act, Section 17, Registration Act, 1877 and Section 105, T.P. Act, 1882. In considering this question Sir Arthur Wilson, who delivered the judgment of the Board, observed at page 146: "The agreement for the payment of Rs. 500 a month for ten years from July 1.895, is in no way inconsistent with the lease of the 4th of that month. Its provisions form no part of the terms of the holding under the lease; their effect will be exhausted some years before the lease takes'' effect. The payment bargained for is no charge on the property; it is not rent nor recoverable as rent, but a mere personal obligation collateral to the lease. Their Lordships are of opinion that the agreement is not affected by Section 92, Evidence Act; and that there is nothing in the Registration Act or in the Transfer of Property Act which required that it should be registered as part of the lease.

Having come to this conclusion their Lordships then addressed themselves to the second question whether the benefit of the agreement to pay Rs. 500 a month could pass to the trustee under a deed of trust executed by the Raja. It is only necessary to reproduce the opening lines of the last paragraph at p. 146 of their Lordships'' judgment where it was observed: "The Rs. 500 a month not being rent, the right to it could not pass under the grant of the zamindari with its incidents contained in para. 4." I therefore have no hesitation in accepting the view arrived at by the learned Small Cause Court Judge that the stipulation to pay Rs. 12 a year or to deliver one maund and 10 seers of fish every year was a personal obligation and that the payment bargained for is not rent nor recoverable as rent. As I stated in the earlier part of the judgment the compromise itself provides in para. 2 that "the fish or its price will not be regarded as the rent of the properties" and that the payment is to cease if the plaintiff or his heirs transfer their share in the village or if their interest is extinguished. That being the true view of the matter the suit was properly cognisable by a civil Court. The contention which commended itself to the learned Judge that such a stipulation was hit by Section 63, Chota Nagpur Tenancy Act, does not appeal to me. The payment agreed upon was not a payment by a tenant to his landlord but was a payment upon which the tenant arrived at a bona Side settlement of a dispute; in other words he agreed to pay this sum not to the plaintiff of that suit as a landlord but to the plaintiff of that suit in consideration for his agreeing not to proceed with the further progress of the suit. The suit was a suit for ejectment and might have succeeded. The tenant therefore took the decision in his own hands and preferred to have the suit disposed of on the terms which he agreed to abide by. Take a simple case. Supposing the defendant in that suit had agreed to pay to the plaintiff a sum of Rs. 300 in consideration of the suit having been dismissed, and a decree had been passed in those terms, the defendant could not have resisted the execution of the decree. Does it make any difference if the same sum is made payable not in one lump sum but in a number of annual payments or where the same sum is being paid in kind in a number of years, the value of the thing to be delivered in kind having been fixed between the parties? The essence of the matter is that the payment in this case cannot be regarded as payment by a tenant to his landlord but is an agreement which is founded on a consideration recognised by law. For these reasons I am of opinion that Section 63, Chota Nagpur Tenancy Act, has no application whatsoever. The result is that the application of the plaintiff must succeed. I would set aside the decision of the Court below and decree the suit of the plaintiff with costs both in this Court and in the Court below. Hearing fee one gold mohur here.

Beevor J.

I agree. I was at first inclined to think that the case reported in Subramanian v. Arunachalam (1902) 29 I.A. 138 (P.C.) was distinguishable on the ground that in that case the payments to be made under the agreement were not to be made during the currency of the lease and therefore could not in that case be treated as rent. In the present case, however, it is clear that the parties at the time of the agreement stipulated that the deliveries of fish would not be regarded as rent. It was clearly stated in the agreement that transferees from the plaintiffs would have no right to such deliveries, and it appears that the contract was a personal agreement which would not bind transferees from the raiyat who entered into that agreement or even, his heirs