Mangan Lal Deoshi Vs. Mohammad Moinul
Haoque & Ors [1950] INSC 36 (1 December 1950)
01/12/1950 SASTRI, M. PATANJALI SASTRI, M.
PATANJALI KANIA, HIRALAL J. (CJ) DAS, SUDHI RANJAN
CITATION: 1951 AIR 11 1950 SCR 833
ACT:
Indian Registration Act, 1908, 8.17 (1) (b)
and (d), s. 17 (2)-"Lease "--Compromise decree creating under lease
between A and B on condition that A pays a sum of money to C--Whether
compulsorily registrable Agreement to lease not creating immediate interest
land--Whether "lease".
HEADNOTE:
An agreement for a lease, which a lease is by
the Indian Registration Act declared to include, must be a document which
effects an actual demise and operates as a lease. It must create present and
immediate interest in land.
Where a litigation between two persons A and
B who claimed to be tenants under C was settled by a compromise decree the
effect of which was to create a perpetual underlease between A and B which was
to take effect only on condition that A paid Rs. 8,000 to C within a fixed
period:
Held, that such a contingent agreement was
not "a lease" within el. (a) of s. 17 (t) of the Indian Registration
Act, and even though it was covered by cl. (b) of the said section it was
exempt from registration under el. (vi) of subs. (2) of s. 17.
Hemanta Kumari Debi v. Midnapur Zamindari Co.
(I L.R. 47 Cal. 485 P.C.) relied on.
CIVIL APPELLATE JURISDICTION: Civil Appeal
No.94 of 1949.
107 834 Appeal from a judgment and decree of
the High Court of Judicature at Patna in Appeal from Appellate Decree No. 97 of
1946 (Mannohar Lall and Mukherji JJ.) dated 23rd December, 1947, confirming the
judgment of the District Judge of Purulia in Appeal No. 159 of 1944.
S.P. Sinha (P. K. Bose, with him) for the
appellant.
N.C. Chatterjee and Panchanan Ghosh (Chandra
Narayan Naik, with them) for the respondent.
1950. December 1. The Judgment of the Court
was delivered by PATANJALI SASTRI J.--This appeal arises out of a suit brought
by the respondent in the court of the Subordinate Judge, Dhanbad, for recovery
of arrears of royalty and cess from the appellant and another alleged to be due
under a compromise decree passed on the 6th March, 1923, in a previous suit
between the predecessors in interest of the parties. The only plea which is
material for the purpose of this appeal is that the compromise decree not
having been registered was inadmissible in evidence. The courts below held that
the document did not require registration and gave effect to its terms in
decreeing the suit. The second defendant has preferred this appeal.
The facts are not now in dispute and may be
briefly stated. On 11th March, 1921, one Kumar Krishna Prasad Singh
(hereinafter referred to as Kumar) granted a permanent lease of the right to
the underground coal in 5,800 bighas of land belonging to him to Shibsaran
Singh and Sitaram Singh (hereinafter referred to as the Singhs) by a registered
patta stipulating for a salami of Rs. 8,000 and royalty at the rate of 2a. per
ton of coal raised subject to a minimum of Rs. 8,000 and for certain other
cesses and interest. On 7th June, 1921, Kumar executed another permanent patta
leasing the right to the coal in 500 bighas out of the 5,800 bighas referred to
above to one Prayngji Ballavji Deoshi and his son Harakchand Deoshi
(hereinafter referred to as the Deoshis). By this document.
835 the Deoshis agreed inter alia to pay
royalty at the rate of 2a. per ton on all classes of coal raised subject to a
minimum of Rs. 750 a year. The Singhs feeling themselves aggrieved by the
latter transaction brought a title suit (No. 1291 of 1921) in the Court of the
Subordinate Judge of Dhanbad for a declaration of their title and for
possession of the 500 bighas leased to the Deoshis under the aforesaid patta of
7th June, 1921. To that suit Kumar was made a party as defendant No. 3, the
Deoshis being defendants 1 and
2. The suit was however compromised on 6th
March, 1923, by all the parties and a decree based on the compromise was also
passed on the same day. The interest of the Singhs was brought to sale in 193S
in execution of a decree obtained against them and was purchased by the
plaintiff who instituted the presnt suit on 3rd October, 1942, claiming the
royalty and cesses payable under the compromise decree for the period from Pous
1345 to Asadh 1349 B.S. from defendants 1 and 2 as the representatives of the
Deoshis who entered into the compromise of March, 1923.
In order to appreciate the contentions of the
parties, it is necessary to set out the relevant terms of the compromise decree
which are as follows :-"The plaintiffs (the Singhs) within two months from
this date shall pay Rs. 8,000 as salami to defendant No. 3 (Kumar). Otherwise
all the terms of the compromise Will stand cancelled and the plaintiffs shall
not be competent to claim any right to or possession over the.land covered by the
patta dated 11th March, 1921... The patta which defendant No. 3 executed in
favour of the plaintiffs in respect of 5,800 bighas of coal land in village
Rahraband shall remain in force, and the plaintiffs will get a decree of
declaration of their right and title to the 500 bighas of coal land in dispute
but defendants 1 and 2 (the Deoshis) shall hold possession as tenants. Besides
the terms mentioned below, defendants 1 and 2 shall remain bound by all the
remaining terms under which they took settlement of the 500 bighas of coal land
from defendant No. 3 under 836 patta and Kabuliyat, and both the defendants 1
and 2 shall possess the same under the plaintiffs from generation to generation
and all the terms of the said patta and Kabuliyat shall remain effective and in
force between them. Both the defendants 1 and 2 shall remain bound to pay to
the plaintiffs commission at the rate of 2a. 6p. per ton on all sorts of coal
instead of 2a. a ton as stated before in the patta of 5,800 bighas of land
settled with the plaintiffs.The plaintiffs shall pay to defendant No. 3 in
future the minimum royalty of Rs. 6,000 instead of Rs. 8,000 as stipulated in
the original patta of 11 th March 1921 and commission at the rate of la. 9p. a
ton in place of 2a. a ton as stipulated in the patta of March 21 ...... Unless
the plaintiffs pay to the defendant No. 3 Rs. 8,000 within 2 months from this
day they shall not be competent to take out execution of this decree, nor shall
they be competent to take possession of the land in dispute. The defendants 1
and 2 within one month from the date of payment of Rs. 8,000 as aforesaid to
defendant No. 3 shall execute a new Kabuliyat in favour of the plaintiff in
respect of the modified terms stated above, i.e., on the condition to pay
commission at the rate of 2a. 6p. per ton...In the new patta which defendant
No. 3 will execute in favour of the plaintiffs he shall embody the condition
that the annual minimum royalty will be Rs. 6,000 instead of Rs. 8,000 and
commission will be at the rate of la. 9p. per ton in place of 2a. per ton as
mentioned in the aforesaid patta. If the defendant No. 3 does not execute the
parts on the aforesaid modified terms in favour'of the plaintiffs within the
time aforesaid and both the defendants 1 and 2 also do not execute a kabuliyat
on the aforesaid modified terms, then this very rafanama shall be treated as
the parts and kabuliyat, and the plaintiffs in accordance with the terms of the
rafanama shall pay to defendant No. 3, Rs. 6,000 only as minimum royalty and
commission at the rate of la. 9p. per ton with respect to 5,800 bighas and
shall continue to realise commission at the rate of 2a. 6p. per ton from
defendants 1 and 2 who shall remain bound to pay the same." 837 The answer
to the question whether this compromise decree requires registration depends on
the legal effect of the changes in the status quo ante of the parties brought
about by the document. A careful analysis reveals the following alterations :-(1)
In the lease to the Singhs, the rate of royalty or commission was reduced from
2a. per ton of coal raised to la. 9p. per ton and the minimum royalty was
reduced from Rs.
8,000 to Rs. 6,000 while the area of coal
land in their khas possession was reduced by 500 bighas.
(2) In the lease to the Deoshis the rate of
royalty or commission was enhanced from 2a. per ton to 2a. 6p. per ton and
tiffs was made payable to the Singhs.
The Singhs and the Deoshis were brought into
a new legal relationship, the former accepting the latter as tenants holding
the disputed 500 bighas under them in consideration of the latter agreeing to
pay the enhanced royalty to the former.
(4) The whole arrangement was made
conditional on the Singhs paying Rs. 8,000 to Kumar within 2 months from the
date of the compromise, it being expressly provided that the Singhs were not to
be entitled to execute the decree or to take possession of the disputed area of
503 bighas which evidently had not till then passed into their possession.
Now, sub-section (1) of section 17 of the Registration
Act, enumerates five categories of documents of which registration is made
compulsory which include" (d) leases of immoveable property from year to
year, or for any term exceeding one year, or reserving a yearly rent;".
Sub section (2) however provided that "nothing in clauses (b) and (c) of
sub-section (1)applies to ...... (vi) any decree or order of court." It
may be mentioned in passing that this clause was amended with affect from the
1st April, 1930, by the Transfer of Property (Amendment) Supplementary Act, 1929,
so as to exclude from the scope of the exception compromise decrees comprising
immovable property other than that which is the subject-matter of the suit. But
838 the amendment cannot affect the document here in question which came into
existence in 1923. Before the amendment, the clause was held to cover even
compromise decrees comprising immovable property which was not the subject
matter of the suit: [Vide Hemanta Kumari Debi v. Midnapur Zamindari Co. (')].
That decision applies to the present case and obviates the objection that
because the compromise in question covered also the remaining 5,300 bighas
which were not the subject-matter of the title suit of 1921, it was outside the
scope of the exception in sub-section (2), clause (vi).
The only question, therefore, is whether the
compromise decree is a "lease" [which expression includes "an
agreement to lease" by the definition in section 2 (7)] within the meaning
of el. (d) of sub-section (1). It is obvious that if the compromise decree
fails within clause (d) of sub-section (1) it would not be protected under
clause (vi) of subsection (2) which excepts only documents falling under the
categories (b) and (c) of sub-section (1). The High Court was of opinion that,
on a proper construction of the terms of the compromise, it did not fall under
clause (d). Manohar Lall J., who delivered the leading judgment, observed:
"It was a tripartite agreement embodied
in the decree of the court and was, therefore, exempt from registration. It
will be oh served also that so far as the defendants were concerned, their
possession of the 500 bighas was not interfered with and they still remained in
possession as the lessees, but instead of paying the royalty to the plaintiffs
it was agreed between all the parties that the defendants would pay the royalty
in future to Shibsaran and Sitcram.
If the matter had stood there, the learned
Advocate for the appellant could not have seriously contested the position, but
he vehemently argued that when the agreement was not to pay the same amount of
royalty or commission as previously agreed to but an altered amount of royalty
and commission, the document should be held to fall within the mischief of
section 17 (1)(d)of the (1) 47 Cal. 485: P.C. 839 Registration Act. The answer
to this contention is, as I have stated just now, to be found in the Full Bench
decision of this court :" [see Charu Chandra Mitra's case ()]. It was
there held that a mere alteration of the rent reserved does not make the
transaction a new lease so as to bring it within clause (d)of subsection (1).
We are unable to share this view. It
oversimplifies the compromise transaction which, in our opinion, involves much
more than a mere alteration of the royalties stipulated for in the previous
pattas executed by Kumar. Nor can we accept the suggestion of Mr. Chatterjee
for the respondents theft the compromise operated as an assignment to the
Singhs by Kumar of the latter's reversion under the "lease granted to the
Deoshis and all that the latter did was to acknowledge the Singhs as their
landlords and attern to them. On tiffs view it was said that the transaction
would not fall under clause (d), although it would fall under clause (b) but
then would be saved by the exception in clause (vi) of sub-section (2). The
argument, however, overlooks that Kumar had leased the area of 5,800 bighas to
the Singhs by his patta dated 11th March, 1921, and the compromise by providing
that the Singhs should pay the reduced royalty of 1a. 9p. per ton in respect of
the whole area preserved Kumar's reversion intact. He could not therefore be
deemed to have assigned any part of his interest in 5,800 bighas as landlord to
the Singhs who continue to hold the entire extent as tenants under him. What
the compromise really did was. as stated already, to bring the Singhs and the
Deoshis into a new legal relationship as underlessor and under lessee in
respect of 500 bighas which were the subject-matter of the title suit; in other
words, its legal effect was to create a perpetual underlease between the Singhs
and the Deoshis which would clearly fall under clause (d) but for the
circumstance that it was to take effect only on condition float the Singhs paid
Rs.
8,000 to Kumar within 2 months (1) 3 P.L.J.
255 840 thereafter. As pointed out by the Judicial Committee in Hemanta Kumar's
case (1) "An agreement for a lease, which a lease is by the statute
declared to include, must, in their Lordships' opinion, be a document which
effects an actual demise and operates as a lease ...... The phrase which in the
context where it occurs and in the statute in which it is found, must in their
opinion relate to some document which creates a present and immediate interest
in the land." The compromise decree expressly provides that unless the sum
of Rs. 8,000 was paid within the stipulated time the Singhs were not to execute
the decree or to take possession of the disputed property. Until the payment
was made it was impossible to determine whether there would be any underlease
or not. Such a contingent agreement is not within clause (d) and although it is
covered by clause (b). is excepted by clause (vi) of sub-section ('2). We
therefore agree with the conclusion of the High Court though on different
grounds and dismiss the appeal with costs.
Appeal dismisseel.
Agent for the appellant: P.K. Chatterjee.
Agent for the respondent: Sukumar Ghose.
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