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Judgment
Anantakrishna Aiyar, J.—2nd and 3rd defendants were holding certain properties under a janmi. On the 28th January, 1909, the 2nd
defendant executed in favour of the 1st, Ex. I, called ""kanom-kuzhikanom mortgage"" document, under which the 1st defendant was entitled to hold
the properties till the 28th January, 1921. Subsequently the 2nd defendant received some renewal fee from the 1st and executed on the 19th
December, 1918, Ex. III, in his (1st defendant''s) favour. The 2nd defendant seems to have subsequently changed his mind and executed in favour
of the plaintiff a melcharth, Ex. A, on the 5th January, 1919. After the expiry of the period covered by Ex. I, the plaintiff on the basis of Ex. A
instituted O.S. No. 419 of 1921 to redeem Ex. I. The 1st defendant contested the suit, and relied on an agreement by the 2nd defendant to renew
Ex. I, and produced Ex. III to evidence the said agreement; he also pleaded that the 2nd defendant had, as a matter of fact, executed a renewal of
the kanom-kuzhikanom deed in his favour on the 19th December, 1920, Ex. II.
The plaintiff succeeded in the trial Court, but on appeal the learned District Judge reversed the first Court''s decree. He found that Ex. III was a
genuine document, and that the plaintiff must be taken to have had notice of the agreement entered into between the 1st defendant and the 2nd
defendant with reference to the granting of the renewal by the 2nd defendant in favour of the 1st. From the dismissal of the suit by the Lower
Appellate Court, the plaintiff preferred a second appeal to this Court, and the learned Judge--Ramesam, J.--before whom the second appeal came
on for hearing held that Ex. III should be taken to evidence only an agreement to renew and that the appellant''s contention that it was a demise by
itself should not be accepted. The learned Judge also found that the finding of the Lower
Appellate Court on the question of notice on the part of the plaintiff of the agreement, Ex. III, should be upheld. He also held that having regard
to the fact that the 1st defendant was in possession of the properties under a kanom-kuzhikanom deed, and having regard to the agreement
entered into between the 1st defendant and the 2nd, the plaintiff was bound to have inquired into the rights of the 1st defendant in the
circumstances and not having done so the plaintiff''s melcharth document, Ex. A, should not be allowed to prevail over the 1st defendant''s rights.
In the result the learned Judge dismissed the second appeal. The present Letters Patent Appeal has been filed by the plaintiff against that decision
of the learned Judge.
Before noticing the arguments advanced by the learned Advocate for the appellant, I may say, that I agree with the opinion of Ramesam, J., that
Ex. III could not operate as a present demise and that it is admissible in evidence though unregistered, and that the parties did not intend a demise
until payment of the balance manusham of Rs. 5-1-3 by the 1st defendant.
It was first contended before us by the learned Advocate on behalf of the plaintiff that having regard to certain decisions of this Court a lessee in
the position of the 1st defendant, whose term had expired, but who had an agreement of renewal in his favour could not for that reason withstand a
suit for possession brought by a lessor or a purchaser from the lessor, and it was argued that the decision of the learned Judge in this case is not
correct. Our attention was drawn to the decisions reported in Achutan Nambudri v. Koman Nair (1902) 13 M.L.J. 217. Gopalan Nair v. Kunhan
Menon ILR (1907) 30 M. 300 : 17 M.L.J. 189 and Kanna Kurup v. Sankara Varma Rajah ILR (1920) 44 M. 344. With reference to this
argument it has to be observed that while the tenant''s (1st defendant''s) possession by itself, though coupled with an agreement to renew, would
not be a complete defence to a suit for possession by a person in the position of the plaintiff in the circumstances, yet as was pointed out by one of
the learned Judges in the Full Bench case in Kurri Veerareddi v. Kurri Bapireddi ILR (1906) 29 M. 336 : 16 M.L.J. 395 where the right of the
defendant to enforce specific performance of the agreement in his favour had not become barred by limitation, it would be open to him to apply to
the Court to have the suit for ejectment stayed, and in the meantime he could file in his turn a suit for specific performance of the agreement, and
after having got a duly registered document, he could file the same in the first suit and thus completely sustain the plea that the plaintiff is not entitled
to the relief asked. (See p. 351 of 29 Mad.) This view has been approved by their Lordships of the Privy Council in a recent case, (1931) L.R. 58
I.A. 91 (Privy Council) . That being so, we have to see whether in the present case if this question had been raised in its proper form before the
trial Court it would not have been open to the 1st defendant to adopt the procedure suggested in the cases I have mentioned. At the time of filing
the written statement--in fact even at the time of the delivery of the judgment by the trial Court--the right of the 1st defendant to sue for specific
performance had not become barred by limitation. That being so, there is no real substance in the contention raised by the learned Advocate for
the appellant before us that the 1st defendant had no manner of right to continue in possession. Further, if it is open to a person in the position of
the 1st defendant to apply for the adjournment of the suit with a view to file a separate suit in his turn for specific performance and get a registered
document, the position of the 1st defendant in the present case is surely better, for the 1st defendant has as a matter of fact obtained a registered
deed, Ex. II, from the 2nd defendant in pursuance of the agreement, Ex. III. That being so, the absence of a registered deed in favour of 1st
defendant at the time of melcharth to the plaintiff should not be taken, in the circumstances, to stand against the rights of the 1st defendant.
It was also suggested that after the grant of Ex. A in favour of the plaintiff by the 2nd defendant on the 5th January, 1919, the document, Ex. II,
which the 1st defendant got from the 2nd on the 19th December, 1920, should not be taken to have really conveyed the rights now in dispute to
the 1st defendant. This technical plea was not raised in any of the lower Courts, nor was it raised before the learned Judge of this Court; nor do.
we find it specifically raised in the grounds of the Letters Patent Appeal, either. In these circumstances, we think, that there is some force in the
contention raised by the learned Advocate for the respondent that such a matter should not be allowed to be raised for the first time here at this
stage of the litigation. In the circumstances I do not think that we should allow this new point to be raised for the first time here. If it had been
raised in proper form in the trial Court, it would have been open to the 1st defendant to file a suit for specific performance against the plaintiff also,
to have a document similar to Ex. II executed by the plaintiff to the 1st defendant. I accordingly overrule the main contention raised by the learned
Advocate for the appellant.
The next point raised by him related to the finding on the question of notice. It was argued that the 1st defendant was in possession only as a
mortgagee, and that a kanom should be taken to be a mortgage and not a lease. It is too late in the day to raise such a contention. It has been held
that a kanom is a combination of both a mortgage and a lease, and some of the recognised incidents of a kanom could not be explained but for the
fact that it also partakes of the incidents of a lease; for example, the question of the forfeiture of the term in case the kanomdar denies the title of
the jenmidemisor. However, looking into the contents of the documents in question before us, Ex. I, it is styled a ""kanomkuzhikanom deed."" Under
it, express authority is conferred on the 1st defendant to plant cocoanut trees, etc. To say that in those circumstances Ex. I evidences only a
mortgage and that the question of notice should be decided on that basis only, is, we think, not quite correct.
Then, it was further argued that even assuming that Ex. 1 is a combination of a mortgage and a lease, yet the inference sought to be drawn on
behalf of the 1st defendant from the possession of the land by the 1st defendant is too farfetched and that the principle of constructive notice should
not be extended to such cases. We find that the doctrine of constructive notice of the rights of a person in possession has been discussed in several
decisions that were quoted before us (Daniels v. Davison (1809) 16 Ves. Jun. 249 : 33 E.R. 978. Faki Ibrahim v. Faki Gulam Mohidin ILR
(1920) 45 B. 910 Babasah v. Hajee Mahomed Akbar Sahib Babasah Vs. Hajee Mahomed Akbar Sahib and Others, (1916) 2 M.W.N. 31"" and
Balchand Mahton v. Bulaki Singh ILR (1928) 8 Pat. 316). Section 27 of the Specific Relief Act was also referred to. But it was argued that those
were cases where the question arose as between the lessee in, possession and a purchaser of the properties and it was contended that some of the
learned Judges who had to consider this question expressed the opinion that the doctrine had probably been pressed too far.
But having regard to the incidents of the transaction evidenced by Ex. I and having regard to the fact that with reference1 to holdings under a
kanom-kuzhikanom and other similar demises, the tenants do, as a matter of fact, expect renewals, and renewals are granted in a very large
majority of cases, we think, that with reference to a case like the one before us it is not a case of extension of the doctrine referred to. I may note
that the legislature has recently recognised the practice and conferred a legal right on the part of the kanom-holders to a renewal of such demise on
certain terms. Having regard to this usual practice, I think that the present is not a case of extension of the principle already recognised in several
cases quoted before us. I may also refer to Hunt v. Luck (1902) 1 Ch. 428 and the decision of the Privy Council in Barnhart v. Greenshields
(1853) 9 Moo. P.C. 18 : 14 E.R. 204. The learned Judge who heard the second appeal thought that it was not a case of extension of the doctrine
if he applied it to the kuzhikanom in question, and we are not satisfied that any sufficient reasons have been shown as to why we should differ from
that opinion. I accordingly overrule this contention also of the learned Advocate for the appellant.
It was finally argued before us that a kanom is a mortgage and that specific performance of an agreement to grant a kanom should not be
decreed by the Courts. There is, however, a recent decision of Krishnan Pandalai, J., reported in Thiruthiyil Unniri Kutti Vs. Narayana Chettiar
and Others, . where a substantially similar question arose for decision, and the learned Judge held that it cannot be said that the transaction of
kanom""--well known in Malabar--is in essence one of loan or mortgage. 1 agree with that decision of the learned Judge. In the case before us, we
have got the specific conditions of the letting, namely, that the 1st defendant should plant trees and otherwise enjoy the property. The argument that
a suit for specific performance of an agreement to grant a loan would not ordinarily be decreed by Courts is, in our opinion, not applicable to a
transaction similar to the one before us. I am therefore unable to agree with this contention of the appellant.
I would accordingly dismiss the Letters Patent Appeal with costs.
Reilly, J.
I agree with my learned brother on all points. There are only three matters on which I should like to say a few words.
I agree with the decision of Krishnan Pandalai, J., in Unniri Kutti v. Narayana Chettiar, that in proper cases there is no difficulty in making a
decree for specific performance of an agreement to grant a kanom. And in this particular case, if there had been a suit for specific performance,
there would have been no difficulty at all, as what defendant No. 1 would have been seeking would have been, not the grant of an original kanom,
but merely a renewal of a kanom, which he already held and for which no further advance was to be made but, on"" the contrary, he was paying a
considerable manusham. The principle, that no decree should be made for specific performance of a contract to advance or take a loan, in my
opinion, does not apply to a case such as this.
I agree too that we should not, at this stage of the case, drive defendant No. 1 to a suit for specific performance of the agreement embodied in
Ex. III. As my learned brother has pointed out, in 1920 he got a renewal of the kanom deed, Ex. II, and that contains the very terms which would
have been contained in any kanom deed which he could have got executed as a result of a suit for specific performance. It is true that Ex. II was
executed by defendant No. 2, not by the plaintiff. But in a suit for specific performance the plaintiff would have been ordered to execute a similar
kanom deed in his favour; and everything that the plaintiff could have properly urged in such a suit she was at liberty to urge and she did urge in this
suit. I think there is no necessity at this late stage to require defendant No. 1 to sue for specific performance.
Ramesam, J.
Was of opinion that the plaintiff must be held to have had notice of the agreement, Ex. III. It is not contended that she had actual notice. The
finding is that she had constructive notice. Ramesam, J., arrived at that finding by applying the principle that a purchaser, who finds a tenant in
possession of land which he buys, must be held to have had notice of the conditions under which that tenant is in possession. There are plenty of
cases to that effect, both in England and in this country. Ramesam, J., has relied particularly upon Daniels v. Davison, and upon Barnhart v.
Greenshields (1853) 9 Moo. P.C. 18 : 14 E.R. 204 and a number of cases in this country in which Daniels v. Davisone has been followed. Now
all those cases relate to the notice which must be imputed to a purchaser of land. Daniels v. Davison, as has been recognised frequently, carries
that principle to great lengths. In that case the purchaser, who knew that there was a tenant in possession, was held to have had notice that the
tenant had in his pocket an agreement from the rendor to sell the very property to him, a thing that one would hardly expect of a tenant. That case
goes very far; and learned Judges in England have sometimes said that they would certainly not extend the doctrine of notice to a purchaser any
further. But here we are dealing with something"" quite different. The question is whether the plaintiff, having obtained a lease from defendant No. 2,
must be imputed with notice of an agreement to renew obtained by the prior lessee, whose term was still running. That seems to me very different
from the case of a purchaser, who, finding a tenant in possession, does not care to make inquiries about the tenant''s rights. With very great respect
I doubt whether the English cases quoted are of use to us in this particular matter; and, if I may say-so, we should be very careful about applying to
this country English decisions in regard to notice, and we should do so only when we are quite sure that the circumstances are really similar. When
we apply the principle of constructive notice--that a man has notice because, if he had made reasonable inquiries, he would have ascertained the
facts and, if he has not ascertained the facts, he has been guilty of gross negligence--we must carefully regard all the circumstances of the case and
of the country and of the people to whom we are going to apply that principle. I am not sure myself that one could say generally in this country that,
if a man took a lease, the term of which was to start on the expiry of an existing term held by some other person, it was his duty as a reasonable
man to inquire whether that other person had an agreement for renewal in his pocket and that he would be guilty of gross negligence if he failed to
make any inquiry about that. But in this case we are dealing with Malabar, and we are dealing with the case of a person who takes a melkanom,
the term of which is to begin after the expiry of the kanom still in force; in her own document the terms of the kanom in force are set out and she
knows that the kanomdar is in possession. Now can any one who is acquainted with Malabar say that the melkanomdar has no reason to suppose
that the kanomdar in possession is likely to be hoping for a renewal? Nobody could say that. Can anybody say that the melkanomdar as a
reasonable person could be unaware that the sitting kanomdar may very well have approached the janmi and have asked for a renewal and may
very well have got an agreement for renewal already? I agree with my learned brother that, when we are dealing with Malabar, we must remember
Malabar conditions; and I have no doubt whatever that the melkanomdar, the plaintiff, if she chose to make no inquiry whether defendant No. 1
had obtained an agreement for renewal, was merely choosing to shut her eyes, and having done that she cannot say that she had no notice.
Therefore, I agree, not on the strength of Daniels v. Davison or Barnhart v. Greenshields (1853) 9 Moo. P.C. 18 : 14 E.R. 204 or the other cases
quoted by Ramesam, J., but on an application of the doctrine by constructive notice which appears to me to be appropriate to the conditions in the
part of the country with which we are concerned in this case, that the plaintiff had notice of Ex. III. ,
I agree with my learned brother that this appeal should be dismissed with costs.