Ram Oraon vs Doman Kalal and others

Jwala Prasad, J.—This appeal arises out of a suit in ejectment. The lands in question appeartain to the holding of one Husaini Gorait, the defendant No. 5 in this case. On the 31st November, 1916, he gave a major portion of it in usufructuary mortgage to defendant No. 2 for a term of five years from 1973 to 1977 (corresponding roughly to 1916-1920) in consideration of a loan of Rs. 800. A similar plot of his holding 460 he had mortgaged to other persons who are not parties to this case. His holding consisted of 7.06 acres of land which included his homestead plots Nos. 239 and 247 and 497 amounting to about 0.08 acre. Husaini surrendered his holding in favour of the manager of the Encumbered Estates on the 19th June, 1917, reserving there out homestead parti lands amounting to 0.07 acre for himself. The surrender was therefore of all the cultivated lands in the holding. The surrender was effected by means of a registered istifanama. Exhibit 3. The plaintiff obtained settlement of the lands from the manager of the Encumbered Estates in September, 1917. Having come to know of the intention of Husaini to surrender the holding he approached the manager by means of a letter from the Roman Catholic priest at Dighia who recommended the settlement of the land with him, which, he said, Husaini was going to surrender. After the surrender the settlement question was started in the office of the manager of the Encumbered Estates on the 28th June, 1917, and ultimately, as observed above, it was settled with the plaintiff in September who paid rent for the same on account of 1973 per receipt Exhibit 2. The plaintiff was, however, resisted by the defendants Nos. 1, 2 and 3 in taking possession of the land. The defendants Nos. 1 and 3 were the sajhadars having taken batai settlement of the land from the mortgagee. The plaintiff, therefore, commenced this action for recovery of possession of the land by filing his plaint on the 19th July, 1918. The Munsif decreed the suit; but the learned Subordinate Judge on appeal set aside the decision of the Munsif and dismissed the suit. Hence the plaintiff has come here in second appeal.

On behalf of the plaintiff appellant the decision of the learned Subordinate Judge is assailed. The Subordinate Judge held that Husaini in making the surrender

could not have been actuated by anything less than a dishonest and improper motive. He had already come to an understanding with the plaintiff and that unmistakeably shows how his conduct came to be influenced in the matter

and that Husaini having given the land in zarpeshgi could not

fairly be permitted to put an end to this interest which he himself created by surrendering the land.

In support of his view the learned Subordinate Judge has relied upon the Full Bench decision of the Calcutta High Court, Syed Mohsenuddin Vs. Bhagaban Chandra Sutradhar and Others, . That was a decision in a case governed by the Bengal Tenancy Act. But the decision was based upon the general principle of law that a person cannot be permitted to defeat or derogate from his own grant and consequently if a raiyat has dealt with his holding in such a manner as to create an interest in favour of a third person, he has lost the power conferred upon him under S. 86 of the Bengal Tenancy Act of surrendering the holding to the landlord and thus defeating the previous transfers already made by him of the entire holding, or a portion thereof.

The present case is governed by the Chota Nagpur Tenancy Act The provisions contained in S. 72 of the Chota Nagpur Tenancy Act are similar to those contained in S. 86 of the Bengal Tenancy Act with this difference that the provisions contained in clause (6) of the Bengal Tenancy Act do not find place in S. 72 of the Chota Nagpur Tenancy Act. That provision is stated in the following terms.

When a holding is subject to incumbrance, secured by a registered instrument, the surrender of the holding shall not be valid unless it is made with the consent of the landlord and the incumbrancer,

Now, a mortgage, as distinguished from a sale, is an incumbrance, and the mortgage in the present case of the defendant No. 2 is secured by a registered instrument. Therefore if the Bengal Tenancy Act applied to the present case the surrender would have been invalid unless it was made with the consent of the landlord and the mortgagee. That clause, as observed above, has been omitted from the Chota Nagpur Tenancy Act, and the reason probably is that the legislature did not consider it desirable in the peculiar circumstances of the tenancy of Chota Nagpur to recognise the right of transfer in the tenants with respect to their holdings. This intention is also to be gathered from the restrictions imposed upon the tenants under Chapter VIII of the Chota Nagpur Tenancy Act, namely, section 46. A raiyat is not permitted to transfer his holding or a portion thereof by mortgage or lease for a longer period than five years or to sell or to make a gift of his holding by any contract or agreement. Be that as it may the absence of a provision similar to clause (6) of S. 86 of the Bengal Tenancy Act from S. 72 of the Chota Nagpur Tenancy Act leaves no power of surrender conferred by the section unhampered by the existence of any incumbrance over the property. It, therefore, logically follows that in spite of a prior sale or mortgage by a raiyat he is free to exercise his right of surrender of the holding in favour of the landlord, for under clause (2) of S. 46 no transfer by a raiyat of his right in his holding or any portion thereof is binding on the landlord unless it is made with his consent in writing. This is complete answer to the contention of the learned Vakil on behalf of the respondents that the surrender must be deemed to be subject to the prior mortgage executed by the raiyat in favour of the defendant No. 2. Whatever the value of a transfer by a raiyat of his non-transferable holding be, so far as the transferee or any other person in the world is concerned, it is absolutely to be ignored and considered to be nonexistent so far as the landlord is concerned. The landlord is the owner of the property, and the raiyafs interest was carved out of it only for limited purposes and the right of reversion which the landlord undoubtedly has in the land cannot be affected except by express statutory provision. That reversion is recognised in the right which accrues to the landlord by an abandonment of the holding or by a voluntary surrender by the tenant who willingly yields up to him the limited right which was carved out. Therefore, it is immaterial that the transfer is for valuable consideration and the surrender for no consideration at all. The principle, upon which the decision of his Lordship, Mukharji, A. C. J. in the Full Bench case referred to above is based, namely, that a person cannot be permitted to derogate from his own grant, is not of universal application and certainly cannot apply to the case of a landlord where, by a bona fide surrender by the tenant, he acquires a statutory right of re-entry into the land which was originally demised in favour of the tenant. Now,.that the aforesaid principle upon which the decision in the Full Bench case of the Calcutta High Court is based does not obviously apply universally as observed is clear from the provisions contained in Ss. 72 and 73 of the Chota Nagpur Tenancy Act. It has been held and is now recognised as settled law that if a raiyat transfers his entire holding either at once or piecemeal he loses all his rights therein and he ceases to be a raiyat and the tenancy is deemed to have been abandoned giving the right of re-entry to the landlord. In such a case the landlord has the right to ignore the transfers, though for valuable considerations, made by the raiyat in favour of third persons. The tenant by his act destroys the previous transfers of the holding and, therefore, he derogates from his own grant. There is no reason why the same should not be the fact when the tenant exercised his right of surrender conferred upon him by S. 72. On the other hand, no equitable considerations would arise in favour of a transferee of a nontransferable holding, for, he with his eyes open and knowing the limited interest of the tenant and his unquestionable right under S. 72 and 73 of surrender and abandonment, the holding being non-transferable without the consent of the landlord, takes the grant. He must, therefore, have foreseen the possible result of surrender or abandonment by the tenant. There is no reason why the landlord should be prejudiced unless he is a party to any fraud or dishonesty committed by his raiyat in surrendering the holding. He never permitted the previous transfers, and the raiyat and his transferee, of their free will and choice, entered into transactions behind his back and probably to his prejudice. Why should he not have the benefit of a bona fide transfer in his favour and exercise his right of re-entry simply because his raiyat had previously transferred the whole or a portion of the holding ?

As I have already said, a surrender like any other act in order to be operative must be bona fide, and if it is tainted with fraud, it confers no right upon the landlord and need not be avoided. The learned Vakil on behalf of the respondents submits that the surrender in the present case has been held by the Courts below to have been tainted with fraud and dishonesty and consequently the plaintiff cannot be permitted to derive any benefit from it. In support of his contention he relies upon the view taken by the Court below and expressed in the passage already quoted from its judgment. The learned Subordinate Judge infers fraud from the statement made in the istifanama as to the reasons which induced the raiyat Husaini Gorait to surrender his holding He says that Husaini Gorait stated

that he had no plough and cattle to enable him to cultivate the land,

but that.

The question of cultivation could not arise before the expiry of the zarpeshgi period.

Says the learned Subordinate Judge " He was, therefore, by no means in such a desperate condition as to drive him to the necessity of adopting a course which was so manifestly unfair to the persons who had advanced money on the security of his land ".

He, therefore, says that his motive must be dishonest and improper. This is not a finding of fraud. Nothing has been said against the landlord as being party to the evil intentions, if any, of the tenant, and from the way in which the learned Subordinate Judge has put it, it seems to me that he was influenced largely by the decision in the Full Bench case of the Calcutta High Court in which it has been held that every surrender after a prior transfer of the entire or part of a holding must be to the prejudice of the prior transferee. On the other hand, no clear case of fraud seems to have been made out in the pleadings. No doubt it has been stated in the written statement of the defendant No 2 that

Husaini Gorait never surrendered his raiyati holding. If Husaini Gorait surrendered his raiyati holding he has done so in collusion with the manager of the Encumbered Estate and his subordinates with a view to prejudice this defendant''s zarpeshgi right and to deprive him of the peshgi money.

Now this is not a statement of a man who knows as a matter of fact that the surrender was fraudulent; for according to the defendant, no surrender had taken place and his attack of the surrender on the ground of fraud is conditional upon the surrender having taken place and is inferred from the fact that it was prejudicial to his zarpeshgi right and calculated to deprive him of the zarpeshgi money. Fraud, as has been laid down, must be expressly pleaded: positive facts and circumstances must be set out clearly giving rise to the application of fraud. Nothing of the sort, was done in this case. That is the reason why no issue of fraud was raised in the case, nor does it seem to have been urged before the Munsif, for he does not seem to have said a word about it in his judgment The Munsif''s judgment is dated the 27th June, 1919, and the decision in the Full Bench case of the Calcutta High Court was on the 3rd August. 1920. The decision, however, came out when the appeal was being argued before the learned Subordinate Judge. The question of fraud was made more prominent probably in the argument at the Bar. There being no issue upon the subject, the evidence must, therefore, have been slender and the learned Subordinate Judge had to content himself with such facts as he could gather from the contents of the istifanama and the consequences of the surrender which necessarily would deprive the defendant No. 2 of his zarpeshgi money. The fraud pleaded has not been found, namely, of there being any collusion between Husaini and the manager of the Encumbered Estates. Therefore, the finding of the learned Subordinate Judge of the surrender being actuated by

dishonest and improper motive

is not a real finding of fact binding upon this Court.

There is no necessity of pursuing the matter further, for the appeal must succeed upon still more substantial ground. The mortgage lease in favour of the defendant-respondent was for five years from 1973 to 1977 and expired in 1920. Under S. 46 of the Chota Nagpur Tenancy Act the mortgage could not be for a term exceeding five years and, therefore, it came to an end ipso facto in 1920. Thereafter the defendant was not entitled to remain in possession of the property as zarpeshgidar. His only remedy, if any, was to hold the executant of the mortgage personally liable to him. No doubt the surrender took place in 1917 and the plaintiff''s action was commenced in 1918; but the defendant had all along been in possession of the property for the full term of his mortgage. Therefore, by the surrender in the present case, the defendant is not at all prejudiced. The tenant defendant No. 5 on the other hand has filed a written statement. He still adheres to the surrender and impugns the mortgage upon the ground that the consideration money though promised was not paid. Hence the mortgage, whether for consideration or not, terminated in 1920 and the land reverted to the original tenant, and he does not dispute the right of the plaintiff based upon the surrender and settlement by the manager of the Encumbered Estates. Therefore, the plaintiff is entitled to recover possession of the property.

Under those circumstances the appeal must succeed. The decision of the lower appellate Court is set aside, the judgment of the Munsif is restored and the plaintiff''s suit is decreed with costs throughout.

Ross, J.

I agree.