Charu Chandra Chattopadhyay vs Anil Baran Roy and Others

Chunder, J.—These two appeals arise out of the same judgment by the District Judge of Bankura reversing that of the Subordinate Judge. One appeal is by the Plaintiff, and the other is by the Defendant. The Plaintiff brought a suit for setting aside a revenue sale of a share of Touzi No. 309 of the Bankura Collectorate for which a separate account had been opened. His allegation was that the sum of Rs. 43 was payable as the revenue in the separate account and the two co-sharers, the Plaintiff and the Defendant No. 1, were to pay it equally. The revenue was payable in three kists. The three instalments for payment were the 12th of January, the 28th of March and the 28th of June according to the written agreement creating the Touzi. It is, therefore, clear that the revenue due became an arrear on the 1st of February, 1st of April, and the 1st of July according as the respective kist of January, March or June was not paid. It is also clear that according to the law of sales for arrears of land revenue the estate could be sold after the 28th of June provided proper notifications had been issued for the non-payment of March kist which became an arrear on the 1st of April if such an arrear had not been paid before the 28th of June. It is also further clear that if the instalment for June was not paid, then it became an arrear in July and the estate could only be sold in this particular case as the arrangement was only for three kists, if this arrear was not paid before the 12th of January of the following year. In the present case it is now clear that the Plaintiff on the 6th of January, 1944, deposited Rs. 21-8 for his share of the revenue due for the whole year 1944 on the separate account. He deposited by his challan Rs. 8-8 for the January kist, Rs. 7 for the March kist and Rs. 6 for the June kist mentioning the amounts and the kists. When the deposits were made in January the instalments for March and June were not yet due, that is, the amounts for these kists were deposited before they became debts even. The deposits were advance payments. It appears that though this was what the Plaintiff did the Collector, after receipt of the money, in his Touzi ledger showed the whole amount Rs. 21-8 as deposited in the month of January without any appropriation. The Defendant No. 1, the other co-sharer in the separate account, deposited Rs. 8-8 in his share for the January kist. The Touzi ledger shows, therefore, Rs. 30 in deposit for January and Rs. 17 as the demand and this demand as paid in January leaving a credit balance of Rs. 13. It is to be found in the Collector''s Touzi ledger that in March the Defendant No. 1 made a payment of Rs. 6 instead of Rs. 7, that is, he made a short payment of rupee one for the kist. If the sum of Rs. 7 is taken in the Plaintiff''s share from the amount deposited previously by him strictly according to the directions given by him at the time of deposit, then the separate account was in default on the 28th of March by one rupee and it became an arrear on the 1st of April. It appears from the Collector''s Touzi ledger that what was actually done in the Collectorate was that the total credit balance was taken as Rs. 13, the payment of Rs. 6 by the Defendant No. 1 was credited making a total credit of Rs. 19. The demand for that kist was Rs. 14 and this was taken as fully satisfied out of Rs. 19 then in hand leaving a credit balance in favour of the separate account of Rs. 5. In June the Defendant No. 1 paid Rs. 6 for revenue. If Rs. 6 had been appropriated out of the Plaintiff''s deposit in June as directed by him when deposit had been made, then the amount in June necessary for payment of revenue of the estate would be fully met as the demand was only Rs. 12, but as we have pointed out in the Collector''s Touzi ledger one rupee had been appropriated towards the instalment due in March kist leaving only a credit balance of Rs. 5 and therefore, as Rs. 6 was paid by Defendant No. 1 the Collector''s Touzi ledger showed a payment of Rs. 11 instead of Rs. 12 for the June kist and the separate account was shown as in arrear by one rupee for nonpayment of it in the June kist. It is now clear that notices under secs. 6 and 7 of (Bengal) Act XI of 1859 were served and these notices again showed that revenue was in "arrears" in June by one rupee and it purported to say that if the same was not paid by the 28th of June, the date for the payment of "arrears of revenue," the estate would be sold. Notices actually issued were thus in law valid for default in payment of the kist of March. This discrepancy between notices and ledger may be due to mistake or to rectification at the time of issue of these notices. It is idle to speculate. The notices actually issued and served under the law were proper notices for sale of an estate which had not paid the full dues of the March kist and had fallen into arrears on the 1st of April. The estate was advertised for sale in September and was sold for Rs. 15 and purchased by Defendant No. 3. It is now clear that very soon after the sale Defendant No. 2 had a conveyance executed by Defendant No. 3 of this property for a consideration stated to be in the document Rs. 500. The Plaintiff came to Court alleging that as the kist for June, 1944, had been fully paid by him and also by Defendant No. 1, the Collector could not sell the separate account for any arrears for nonpayment of kist in June. His contention was that the arrears were due for nonpayment of the kist in March and, therefore, the Collector was wrong in showing the arrears as due for non-payment of the kist in June. Whatever may be the mistake made in the Touzi ledger of the Collector the documents necessary in law before a sale can validly take place are the notifications and the notifications as we have pointed out were correct for arrears due to non-payment of revenue in March kist. This was not noticed by the Plaintiff at all. His alternative case was that if the revenue was in default for the June kist, then it became an arrear in July and the estate could not be sold in September as he was entitled to pay off the arrears before the 12th of January in the following year. It is this branch of his alternative case which has been argued before us in the appeal on behalf of the Plaintiff. Mr. Gupta''s contention is that the Collector could appropriate rupee one towards the kist in default in March and therefore, the real default in payment of kist was in June and, therefore, the sale held in September was not valid. The trial Court had found that the sale was invalid as the arrears were clue to non-payment of June kist and the sale could not take place before January. The learned District Judge on appeal held that the sale was valid. Both the Courts held that Defendant No. 1, the defaulting co-sharer proprietor, made the short payment of rupee one. He was served with notice of sale and still he did not pay up the arrear of one rupee only though he himself paid on the 28th of June the amount exactly due for June. Both the Courts have found that Defendant No. 3 was a benamdar of Defendant No. 1 at the time of purchase and that the Defendant No. 2 was engaged in the business of Defendant No. 1 and was his benamdar in whose name the transfer was taken from Defendant No. 3 by Defendant No. 1. The trial Court found that there was fraud. The Appellate Court said that as fraud was not a distinct issue raised in the issues as framed it must be taken that there was no fraud but it held that as both Defendant No. 3 and Defendant No. 2 were benamdars of Defendant No. 1, the defaulting co-sharer, the Plaintiff is entitled to get back his share on payment of the proportionate amount of the cost of getting back the property. It came to the conclusion that as Defendant No. 3 had been paid Rs. 500, obviously for the services rendered by him as his perquisites or remuneration, the Plaintiff must pay Rs. 250 to Defendant No. 1 in order to get back his half share of the separate account. The Plaintiff in his appeal contends first that the District Judge was wrong in negativing fraud and if it was a fraudulent transaction on the part of Defendant No. 1, then the Defendant No. 1 is not entitled to any repayment in re-conveying the Plaintiff''s share of the property and it was further contended that even if this Court holds that there is no fraud then as the property was sold for Rs. 15, the Defendant No. 1 was entitled only to half share of that amount plus proper expenses and not Rs. 250 as ordered by the District Judge.

In the appeal filed on behalf of the Defendant No. 2 it has been contended that the District Judge''s finding of the benami was not a definite finding and the case should be sent back to arrive at definite findings on that point. We are unable to agree with the learned Advocate for the Defendant Appellant that the District Judge had not given definite findings. His findings are very definite that both Defendant No. 3 and Defendant No. 2 are benamdars of the Defendant No. 1. It definitely says that he decides that Defendant No. 1 purchased through Defendant No. 3 as his benamdar at the auction and that a re-conveyance was taken from Defendant No. 3 by Defendant No. 1 with Defendant No. 2 as his benamdar in that transaction. As far as the finding of fraud is concerned we are unable to understand the learned District Judge''s finding that there was no fraud. It was not a proper judgment of reversal as far as his reversing the finding of fraud of the Subordinate Judge is concerned. The District Judge hat found all the elements of fraud in his judgment but still he came to hold that there was no fraud on the ground of absence of a definite issue. We are unable to accept his finding as a proper finding in reversal and we set aside that finding and hold with the Subordinate Judge that Defendant No. 1 fraudulently, that is, to defraud his co-sharer the Plaintiff, purchased the property at the revenue sale in the benami of Defendant No. 3 and then took a conveyance of the same from Defendant No. 3 in the benami of Defendant No. 2.

The appeal filed by the Defendant, namely. Second Appeal No. 2118 of 1947 is thus disposed of--no remand is called for.

Coming now to the appeal of the Plaintiff (Second Appeal No. 2027 of 1947) it has been urged by the learned Advocate for the Defendant that the case of Sheikh Mahomed Jan v. Munshi Ganga Bishnu Singh 38 I.A. 80 : S.C. 15 C.W.N. 443 : B.C. 13 C.L.J. 525 (1911) will clearly show that the Collector, was not authorised to appropriate rupee one to the March kist and that the June kist was not in arrear. His contention is that the March kist was in arrears and so the sale was valid. It may be pointed out that the decision in Sheikh Mahomed Jan v. Munshi Ganga Bishnu Singh 38 I.A. 80 : S.C. 15 C.W.N. 443 : B.C. 13 C.L.J. 525 (1911) did not go upon secs. 59 and 60 of the Indian Contract Act although in the High Court those sections had been agitated. It went upon the fact that when the proprietor paid the money the Collector after receiving it appropriated the money to the kist for which it was paid and, therefore, the Collector could not without the amount of the proprietor re-adjust the appropriation and appropriate part of it to the previous kist in default. In the present case there was no such appropriation and subsequent re-adjustment by the Collector. As far as the Collector''s Touzi ledger goes he appropriated the whole payment of Rs. 21-8 by the Plaintiff as payment made in January for the whole amount and he went on keeping a running account. Therefore the decision in Sheikh Mahomed Jen v. Munshi Ganga Bishnu Singh 38 I.A. 80 : S.C. 15 C.W.N. 443 : B.C. 13 C.L.J. 525 (1911) cited above does not strictly apply to the present case.

It has been urged on behalf of the Defendant that in view of the decisions in the case of Jotindra Mohan Sen v. Uma Nath Guha 8 C.L.J. 41 (1908) and the case of Lal Behary Maity v. Rajendra Nath Mity 30 C.W.N. 618 (1926) by two Divisional Benches of this Court, it must be held that secs. 59 and 60 of the Indian Contract Act apply to payment of land revenue and if the debtor appropriates the amount paid to one out of several debts, then the Collector could not appropriate that amount to any other kist in arrear, that is, to any other debt. We express no opinion as to whether these decisions are correctly based upon the Judicial Committee''s decision in Sheikh Mahomed Jan v. Munshi Ganga Bishnu Singh 38 I.A. 80 : S.C. 15 C.W.N. 443 : B.C. 13 C.L.J. 525 (1911), but in the present case these decisions also have no application because technically there was no debt when the payment was made in January, 1944. The instalments for March and June were then not due. The amounts, therefore, for those kists were only advance deposits and not payment towards one of several debts in terms of sec. 59 or sec. 60 of the Indian Contract Act. The two decisions, therefore, do not again strictly apply to the present case.

It has been urged by Mr. Gupta that in view of the deision in the case of Indra Mani Dasya v. Priyanath Chakravarty 18 C.W.N. 400 (1914) followed in the case of Bibi Sakina Khatoon v. Khirod Chandra Manna 46 C.W.N. 73 (1941) unless the v, hole estate was in arrear, and not merely the separate account, there could be no sale of the separate account. He, therefore, contends that the surplus amount in the hands of the Collector from the payment made in January by the Plaintiff should be taken and adjusted against the default in March and we must hold that the June kist was in default. The decisions made it clear that when there is nothing to prevent the Collector from appropriating any surplus amount in the account of an estate to any arrears falling due, the Collector certainly has the power to make such appropriation and must do so before he can sell even the separate account. But if money has been deposited with the Collector with a distinct direction by the depositor that the money is to be applied for certain definite payments, the Collector in our opinion has no authority without the consent of the depositor to apply any part of such deposit to a debt which may have subsequently arisen even to himself in violation of the definite directions given by the depositor. The Collector is at liberty not to accept any such deposit when made but if he accepts it, he accepts it on the terms on which such deposits are made. In this case the Collector, in view of the definite direction given by the Plaintiff to apply the two sums of Rs. 7 and Rs. 6 to the two kists respectively of March and June could not apply rupee out of the money ear-marked for June kist towards meeting the default made by Defendant No. 1 in March kist. The Plaintiff is, therefore, right in his alternative case in the plaint that it was the revenue payable in the March kist which was in arrear. We have pointed out that the sale was perfectly valid as far as any default in March kist was concerned because the notifications were issued correctly for such a default though the notification did not agree with the Touzi ledger or Arrears List. The sale must, thenfore be held valid and the appeal must fail Ear as this ground of validity of the sale is concerned. We have already pointed out in connection with the appeal of the defendant (Second Appeal No. 2118 of 1947) that the Defendant No. 1 fraudulently obtained this separate account by purchase at the revenue sale in the benami of Defendant No. 3 and then by a conveyance from Defendant No. 3 in the benami of Defendant No. 2. Under these circumstances the Plaintiff is entitled to have his half share of the separate account book from Defendant No. 1 without any payment.

The order of the District Judge will, therefore, be modified to this extent in Second Appeal No. 2027 of 1947 that the Plaintiff''s share will be directed to be re-conveyed to him by Defendant No. 1 with out any payment. Each party will bear his own costs in both the appeals.

Sen, J.

I agree.