Shamma
Bhatt & Ors Vs. T. Ramakrishna Bhatt [1987] INSC 88; 1987 Air 1348; 1987
Scc (2) 416; Jt 1987 (2) 1; 1987 Scale (1) 636 (27 March 1987)
KHALID,
V. (J) KHALID, V. (J) OZA, G.L. (J)
CITATION:
1987 AIR 1348 1987 SCC (2) 416 JT 1987 (2) 1 1987 SCALE (1)636
ACT:
Kerala
Compensation for Tenants Improvements Act. 1958--Ss. 2(d) and
5--Tenant--Compensation for Improvement--When available.
HEADNOTE:
The
appellants' father had obtained sale of the property in question during the
minority of the respondent through his widowed mother, who was acting as his
guardian. The respondent, on attaining majority, filed a suit for declaration
that the said sale-deed was invalid and not binding upon him and for recovery
of possession of the property. The judgment and decree of the trial Court
dismissing the suit was affirmed by the Appellate Court. In Second Appeal, the
High Court set aside the judgments of the Court below, allowed the appeal and decreed
the suit, directing recovery of possession of properties on payment of Rs.4,700
being the sale consideration and a sum of Rs.4,164 being the compensation for
improvement. The Special Leave Petition filed by the appellants was dismissed.
The
respondent filed execution, which was resisted by the appellants on the ground
that the properties could not be ordered to be delivered without payment of the
value of improvements effected by them subsequent to the year 1952.
They also
filed an application for the issue of a commission to revalue the improvements,
claiming that they had effected improvements to the tune of Rs.gO,O00. The
respondent contested this application denying that the appellants had made any
improvements and contended that the question of improvements had been concluded
by the judgment of the High Court in the Second Appeal. The executing Court
dismissed this petition. The District Judge allowed the appeal filed by the
appellants and set aside the order of the executing Court.
The High
Court set aside the judgment of the District Judge and restored the order of
the executing Court and directed recovery of the property. The High Court
observed that "the sum of Rs.4,164.8.0 was directed to be paid not because
the respondents were entitled to it, but because the appellant agreed to pay
it.'' In the appeal to this Court, on behalf of the appellants it was 701
contended: (1) that the judgment of the High Court was wrong and that the
conclusion arrived at by the High Court was as a result of confusion regarding
the pleadings in the case and the question of law involved; (2) that at the
trial stage an issue was struck as issue No. 8 regarding the value of
improvements which was adjudicated and the value of improvements was adjudged;
(3) that the appellants were tenants within the meaning of s. 2(d) of the
Kerala Compensation for Tenants Improvements Act, 1958 (Act 29 of 1958) and
that their claim for value of improvements was made on the strength of s. 5 of
the Act and, therefore, they are entitled to the value of improvements; and (4)
that the value of improvements has to be ascertained under the Act on the
execution side and their claim cannot be defeated by flourishing the judgment
of the High Court and the dismissal of the S.L.P.
Dismissing
the Appeal,
HELD: 1.
The suit was filed in 1952. At that time there was no enactment available for
the defendant to claim value of improvements. Neither in the original written
statement nor in the additional written statement dated 15.11.1954, did the defendants
claim the value of improvements under the Act. Though at the execution stage a
plea was raised under s. 5 of Act 29 of 1958, but in the Judgment in the Second
Appeal No. 464 of 1964 dated 27.11.1969, the Division Bench decided that no
claim for improvements was made either under s. 51 of the Transfer of Property
Act or under s. 4 of Act 29 of 1958. Moreover, the High Court also found that
no objection was taken by the appellants in the lower Appellate Court or before
the High Court to the finding that in case of eviction the defendant would be
entitled to Rs.4,164.8.0.
as
compensation. This judgment was rendered when Act 29 of 1958 had already come
into force. Against this judgment a special leave petition was filed and
dismissed. Thus, there is a concluded finding against the appellants that they
were not entitled to anything more than the value of improvements decreed by
the trial Court. [706H; 707A-C]
2.
Section 5 comes into operation only when a defendant against whom a suit for
eviction is instituted establishes a claim for compensation under the Act. The
Judgment of the High Court rendered in 1969 has clearly held that the value of
improvement awarded was not under s. 4 of the Act but was an amount agreed by
the plaintiff. The appellants cannot succeed and have not succeeded in
satisfying this Court that they ever made a claim for compensation under s. 4
of the Act and succeeded in such a claim. Therefore, their further claim for
getting the improvements revalued cannot be accepted. [707E-G] 702
3. The
question whether a person who came into possession of the properties of a minor
could be brought within the definition of 'tenant' in s. 2(d)(iii) will have to
be considered in an appropriate case. [707G-H]
4. Purely
on an equitable basis, the respondent shall pay to the appellants a sum of
Rs.30,000 in addition to the amount decreed. On such payment the appellants
shall deliver the property to the respondent. The respondent shall be at
liberty to withdraw the amounts deposited by the appellants in the trial court
pursuant to the order of this Court, if not already withdrawn. [709B-C]
CIVIL
APPELLATE JURISDICTION: Civil Appeal No. 383(N) of 1973.
From the
Judgment and Order dated 7.3.1972 of the High Court of Kerala in S.A. No. 549
of 1971.
G.
Viswanath Iyer and Narayan Nettar for the Appellants.
T.S.
Krishnamurthy Iyer, Vijay Kumar Verma and Madhu Moolchandani for the
Respondent.
The
Judgment of the Court was delivered by KHALID, J. The appellants are the
defendant in O.S. 55 of 1952 in the Sub-Court, Mangalore. Their father had obtained
sale of the property involved in this appeal by a document dated 28-4-1939,
executed by the widowed mother of the respondent-plaintiff who was a minor,
aged six years, she acting as his guardian. After he attained majority, he
filed a suit for a declaration that the said sale deed was invalid and was not
binding upon him and for recovery of possession thereof. The Trial Court
dismissed the suit. In appeal, the appellate court confirmed the decree and Judgment
of the Trial Court. In second appeal, the High Court of Kerala, by its
Judgment, dated 27-11-1969, set aside the Judgments of the Courts below,
allowed the appeal and decreed the suit. The decree directed recovery of
possession of the properties on payment of the sum of Rs.4,700 being the sale
consideration and a sum of Rs.4,164 being the compensation for improvements.
On
15-9-1970, the decree-holder, respondent herein, filed R.E.P. 68/70 in the
Sub-Court, Kasargod, depositing the amount due under the decree of the High
Court and praying for delivery of the properties from the possession of the
Judgment debtors, the appellants. Execution was resisted by the appellants on
the ground that no delivery could be ordered without payment of the value of
improvements effected by them subsequent to the year 1952. They also filed
R.E.A. No. 146/70 for the issue of a commission to re-value the improvements,
claiming that they had effected improvements to the tune of Rs.80,000. The
respondent contested this application, denied that the appellants had made any
improvements and contended that the question of improvements had been concluded
by the Judgment of the High Court in the second appeal. The executing Court
dismissed this petition. Aggrieved by this order, the appellants filed an
appeal before the District Judge, Tellicherry, who allowed the appeal by his
Judgment dated 12th April, 1971 and set aside the order of the executing Court.
The matter was taken to the High Court by way of Execution Second Appeal. A
Division Bench of the Kerala High Court, on a reference from a learned Single
Judge, set aside the Judgment of the District Judge by its Judgment dated 7-31972
and restored the order of the Subordinate Judge and directed recovery of the property.
The appellants, moved the High Court for grant of certificate of fitness, which
prayer was declined and hence have filed this appeal, by special leave.
The suit
was filed by the plaintiff within three years'of his attaining majority
alleging that the assignee took advantage of the ignorance and helpless
condition of the plaintiff's mother, who was a young widow and that there was
neither legal necessity nor pressure from the estate for effecting the sale. He
averred in the plaint that there was a partition decree in his favour in which
he had been allotted these properties with outstanding amounting to Rs.5,300
and mesne profits to the extent of Rs.1,549 which were sufficient to discharge
the debts due by the estate. The entire immovable properties belonging to the
plaintiff, including the family residential house, were alienated. The High
Court in second appeal on the trial side held that the alienation was not
something which a man of ordinary prudence would have effected, had the
properties been owned by him and thus held it not binding on the plaintiff. The
learned Judges of the Division Bench then considered the question of the
defendant's right for compensation for improvements, if any, effected. This
claim was denied. In the written statement filed by the defendant, as noted by
the High Court, all that was claimed was that improvements had been effected to
the tune of Rs.4,000. But no specific claim was made for compensation in the
event of eviction.
The High
Court also noted that the averment regarding improvements was itself made in
the context of denying that the property would have fetched Rs.11,000 at the
time of sale. In the 704 additional written statement filed by the defendant a
claim was made that improvements to the value of Rs.11,168 had been effected
after the sale date and that under any circumstances, the defendants were
entitled to just and adequate compensation for them. The Division Bench
adverting to this aspect of the case held against the appellants with the
following observation:
"The
basis of the claim has not been stated anywhere, and no averments of fact
necessary for attracting section 51 of the Transfer of Property Act or Section
4 of the Kerala Compensation for Tenants' Improvements Act, 1958, have been
made. Hence, the claim for value of improvements would appear to be
unsustainable.
However,
no objection has been taken by the appellant in the lower appellate court or in
this Court to the finding of the trial court that in case of eviction, the
defendants would be entitled to Rs.4,164.8.0 as compensation for
improvements." It was with these observations regarding improvements that
the appeal was allowed and the suit for recovery decreed.
When the
matter reached the High Court in second appeal on the execution side the matter
was heard by another Division Bench of the Kerala High Court. The Division
Bench relied upon the following observation in the Judgment of the Division
Bench on the original side and declined relief of value of improvements to the
appellants, with the following observation:
The
Division Bench considered the question of value of improvements in paragraph 9
of the Judgments and Unnikrishna Kurup, J. who spoke for the Division Bench has
stated in unequivocal terms:
"Hence,
the claim for value of improvements would appear to be unsustainable. However,
no objection has been taken by the appellant in the lower appellate court or in
this Court to the finding of the trial court that in case of eviction, the
defendants would be entitled to Rs.4,164,8.0. as compensation for improvements."
We may in passing on also observe that the appellant had filed an application
for special leave against the first Judgment in second appeal. which was
dismissed. The claim of value of improvements was 705 rejected by the Division
Bench with the following observation:
"The
sum of Rs.4,164.8.0 was directed to be paid, we repeat, not because the
respondents were entitled to it, but because the appellant agreed to pay
it." It is with these materials that the present claim of the appellants
for value of improvements has to be considered.
We may
indicate at this stage itself that the Commissioner appointed at the instance
of this Court, assessed the value of improvements at Rs.1,00,031.40, by his
report dated 12-10-1972. The learned counsel for the appellant made a forceful
plea that the Judgment of the High Court was wrong and that the conclusion
arrived at by the High Court was as a result of a confusion regarding the
pleadings in the case and the question of law involved. He stated that at the
trial stage an issue was struck as issue No. 8 regarding the value of
improvements. This question was adjudicated and the value of improvements was
adjudged after due consideration of this issue. His further submission is that
the appellants were tenants within the meaning of Section 2(d) of the Kerala
Compensation for Tenants Improvements Act, 1958 (Act 29 of 1958), and that the
claim for value of improvements was made on the strength of Section 5 of the
Act. He relied upon a Division Bench ruling in Veerasikku Gounder v. Kurian, 1
in support of his contention that the appellants were tenants and were entitled
to the value of improvements.
The
property is situated in the old South Kerala District which formed part of the
then Madras Presidency. At the time the suit was filed, there was no enactment
in force in that area, enabling persons in possession of property belonging to
another to claim value improvements in a suit for recovery of possession. The
area, where the property in dispute is situated, became part of Kerala when the
said State was formed. When Act 29 of 1958 was enacted, there were two
enactments in existence, applicable to the Travancore Cochin and the Malbar
Area, regarding the claims for improvements for tenants in possession. They are
the Travancore Cochin Compensation for Tenants Improvements Act, 1956 and the
Malbar Compensation for Tenants Improvements Act, 1899. Both these Acts were
repealed when Act 29 of 1958 was enacted. Section 2(d) of the new Act defines
'tenant', the relevant portion of which reads as follows:
"2(d)
'tenant' with its grammatical variations and cognate 706 expression includes-(i)
..............
(ii)
........
(iii) a
person who comes into possession of land belonging to another person and makes
improvements thereon in the bona fide belief that he is entitled to make such
improvements." The appellants contention is that they satisfy this definition
and that, therefore, they are entitled to the benefit of this Act. Section 4
deals with the entitlement to compensation for improvements for tenants for the
improvements made by them, or their predecessor-in-interest on eviction.
Section 5
states that when in a suit for eviction instituted against the tenant the
plaintiff succeeds and the defendant establishes a claim for compensation due
under Section 4 for improvements, the Court shall ascertain the amount of compensation
and shall pass a decree for payment of the amount so found due to the tenants.
Subsection 3 of this section gives an additional right to such tenants for
value of improvements effected after the decree by evaluation. We read the
section for a correct understanding of the same:
"5(3)
The amount of compensation for improvements made subsequent to the date upto
which compensation for improvements has been adjudged in the decree and the
re-valuation of an improvement, for which compensation has been so adjudged,
when and in so far as such revaluation may be necessary when reference to the
condition of such improvements at the time of eviction as well as any sum of
money accruing due to the plaintiff subsequent to the said date for rent, or
otherwise, in respect of the tenancy, shall be determined by order of the court
executing the decree and the decree shall be varied in accordance with such
order." It is basing on this Section that the claim is made for value of
improvements by the appellants.
The suit
was filed in 1952. At the time there was no enactment available for the
defendant to claim value of improvements. Neither in the original written
statement nor in the additional written statement 707 dated 15-11-1954, did the
defendants claim the value of improvements under the Act. It is true that at
the execution stage a plea was raised under Section 5 of Act 29 of 1958.
But it is
necessary to remember that in the Judgment in the Second Appeal No. 464 of
1964, the Division Bench decided on 27-11-1969, that no claim for .improvements
was made either under Section 51 of the Transfer of Property Act or under
Section 4 of Act 29 of 1958. Moreover, the High Court also found that no
objection was taken by the appellants in the lower appellate court or before
the High Court to the finding that in case of eviction the defendant would be
entitled to Rs.4,164.8.0 as compensation. This Judgment was rendered when Act
29 of 1958 had already come into force. Against this Judgment this Court was
moved by filing a special leave petition and that was dismissed. Thus, there is
a concluded finding against the appellants that they were not entitled to
anything more than the value of improvements decreed by the trial Court.
In the
Judgment under appeal also the High Court has reiterated the fact that the
appellants were being paid the amount mentioned above not because they were
entitled to it, but because the appellant agreed to pay it. The learned counsel
for the appellants Shri G. Vishwanatha Iyer tries to over-come the finality of
this Judgment with the contention that the value of improvements has to be
ascertained under the Act on the execution side and his claim cannot be defeated
by flourishing the Judgment of the High Court and the dismissal of the S.L.P.
We find it difficult to accept the appellant's case. Section 5 comes into
operation only when a defendant against whom a suit for eviction is instituted
establishes a claim for compensation under the Act. The Judgment of the High
Court rendered in 1969 has clearly held that the value of improvement awarded
was not under Section 4 of the Act but was an amount agreed by the plaintiff.
The appellants cannot succeed and have not succeeded in satisfying us that they
ever made a claim for compensation under Section 4 of the Act and succeeded in
such a claim. Therefore their further claim for getting the improvements revalued
cannot be accepted.
We do not
wish to pronounce upon the question whether a person like the appellants who
came into possession of the properties of a minor through his young widowed
mother could be brought within the definition of tenant in Section 2(d)(iii).
This matter will have to be considered in an appropriate case and the
correctness of the decision of the Kerala High Court brought to our notice by
the appellant's counsel tested then. The appeal has only, therefore, to be
dismissed.
708
However, we feel that some equity has to be worked out in this case. This Court
issued notice in the S.L.P. on 20-6-1972. On 1-9-1972 stay of operation of
decree was granted, and an opportunity was given to enable the parties to come
to a compromise. On 18-9-1972, this Court directed a Commissioner to be
appointed to assess the value of improvements which were made subsequent to the
date upto which the compensation for improvements had already been adjudged. It
was pursuant to this direction that a report was submitted showing the value of
improvements at more than a lakh of rupees. On 23-2-1973, this Court granted
special leave and stayed the operation of the decree on condition that the
appellants deposit a sum of Rs.5,000 each year in the Trial Court and
permitting the respondents to withdraw the same on furnishing security. On
April 1, 1980, this Court passed an order as follows:"Counsel on both
sides, after arguments were heard in substantial measure, agreed with us that
this was a case pre-eminently fit for settlement. The question of law raised is
a ticklish one and the consequences will be 'all or nothing'. The suggestion
which appears to be acceptable to counsel on both sides is one of two
alternatives, the option to choose being left to the respondent, since he has
won in the High Court. The alternatives are:
(a) the
appellant is to pay a sum of Rs.50,000 to the respondent in addition to the
respondent being entitled to withdraw an amount of Rs.30,000 plus Rs.8,000 and
odd lying in deposit to the credit of the suit. In this event the appeal will
stand allowed and the property will be kept by the appellant as owners of the
property;
(b)
alternatively, the respondent will pay to the appellant a sum of Rs.50,000 and
the appellant will be further entitled to withdraw a sum of Rs.30,000 plus
Rs.8,000 now lying in deposit to the credit of the suit.
Thereupon
the appellant will surrender possession forthwith to the respondent. The
property be kept in the same condition as it is now.
Post the
matter on Tuesday i.e. 8-4-80." When the matter came before us for
hearing, we asked the council whether a compromise was possible. We found that
the parties were not agreeable for a compromise. The appellants have been in
709 possession of the properties ever since 1934 and have been enjoying the
income therefrom. It is true that they have effected improvements to the
property. That being so, we feel that the appellants should not be left without
any compensation for the improvements effected. We make this observation purely
on an equitable basis. We direct the respondents to pay to the appellants a sum
of Rs.30,000 in addition to the amount decreed. On such payment the appellants
shall deliver the property to the respondents. The respondents will be at
liberty to withdraw the amounts deposited by the appellants in the Trial Court
pursuant to the orders of this Court if not already withdrawn.
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