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Narsingh Das v. Permeshwari Das
Judgment Summary — Beg, J. (Special Appeal)
Factual and Procedural Background
The respondent (landlord) leased premises by an instrument dated 20 July 1943 for 30 years at an annual rent of Rs. 100, with rent payable every three months and a covenant that non-payment would render the lessee liable to ejectment (and the lessor would have a right to possession by removal of constructions).
Rent fell into arrears after 20 July 1950. A sum of Rs. 333/14/- was said to be due for the period 20 July 1950 to 19 November 1953. The landlord served a notice on 22 November 1953 demanding arrears and the notice was held to determine the tenancy with effect from 20 December 1953.
The landlord filed suit on 21 January 1954 for (a) possession of the land after removal of constructions, (b) recovery of arrears of rent, (c) damages from 20 December 1953 to the date of institution of the suit, and (d) ejectment.
The defendants contested the suit on multiple grounds (including an allegation of novation/substitution of tenant, a challenge to validity of notice to the substituted tenant, undervaluation of the suit and insufficiency of court-fee). The trial court found for the plaintiff and decreed the suit. The defendants' first appeal was dismissed, a second appeal to this Court was dismissed by a single judge, and the defendants were granted leave to file the present Special Appeal.
Legal Issues Presented
- Whether the notice of ejectment issued by the respondent was valid.
- Whether the defendants were entitled to the protection of Section 114 of the Transfer of Property Act (i.e., whether they could purge the forfeiture by depositing the "rent in arrears, together with interest thereon and his full costs of the suit" or by giving sufficient security, thus entitling them to relief against forfeiture).
Arguments of the Parties
Appellants' Arguments
- The original contract had been altered and novated so that defendant No. 2 was substituted in place of defendant No. 1; accordingly defendant No. 1 was no longer liable for rent.
- No valid notice to quit had been given to defendant No. 2; therefore the tenancy had not been determined in respect of defendant No. 2 and no question of damages arose.
- They contended before this Court that after the notice dated 22 November 1953 and the determination with effect from 20 December 1953 the defendants became trespassers and that amounts accruing after 20 December 1953 were damages for use and occupation, not "rent" — therefore the deposit they made (which did not cover the full amount claimed by the plaintiff up to the date of final hearing) should be treated as sufficient compliance with Section 114 of the Transfer of Property Act.
- They relied on Section 114 of the Transfer of Property Act as entitling them to relief against forfeiture if they paid or tendered arrears, interest and full costs, or gave sufficient security.
Respondent's Position (as set out in the opinion)
- The respondent sued for possession, removal of constructions, arrears of rent and damages and relied on the lease term permitting ejectment for non-payment of rent; the respondent maintained that arrears had accrued and rent had fallen into default leading to forfeiture and determination of the tenancy.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Dhurrumtolla Properties, Ltd. v. Dhunbai Peroshaw, A.I.R. 1931 Cal. 457 | Cited in support of the view that the tenant's deposit required under Section 114 should be construed broadly to include amounts for which the tenant would be liable if treated as still a lessee. | The Court relied on this authority as supporting the interpretation that "rent" in Section 114 should be taken to include the entire amount the tenant would be liable for up to the date of tender, treating the tenancy as subsisting for the purpose of the section. |
| Vasudeva Udpa v. Krishna Upda, A.I.R. 1921 Mad. 418 | Madras cases (including this) were cited for the proposition that even amounts barred by limitation should be included in the amount deposited by the tenant under Section 114. | The Court referenced this decision as part of a line of Madras authorities supporting an expansive view of the amounts to be deposited under Section 114; used to bolster the Court's construction. |
| Gurpur Vamana Pai v. Venkatu Naika, A.I.R. 1936 Mad. 116 | Another Madras decision cited for the view that the tenant's deposit under Section 114 may need to include amounts otherwise barred by limitation. | The Court cited this case along with the other Madras authorities to support its interpretation of Section 114. |
| Janab Vellathi v. Smt. K. Kadervel Thayammal, A.I.R. 1958 Mad. 232 | Madras authority in the same line indicating the broad application of Section 114's requirements for deposit. | The Court relied on this authority as part of the supportive jurisprudence for construing "rent" in Section 114 to include the tenant's full liability up to the date of tender. |
Court's Reasoning and Analysis
The Court structured its reasoning in two main parts: first addressing the defendants' contention on the validity of the notice of ejectment, then analysing the defendants' reliance on Section 114 of the Transfer of Property Act.
1. Notice of Ejectment: The Court declined to entertain the challenge to the validity of the notice because that plea had been given up by the defendants at trial, was not pursued on first or second appeal, and was not mentioned in the memorandum of Special Appeal. On that procedural basis the Court refused to entertain this plea.
2. Interpretation and application of Section 114: The Court examined Section 114 (which provides a remedy to a lessee whose lease has been forfeited for non-payment of rent if, at the hearing, he pays or tenders the rent in arrear together with interest and full costs of the suit, or gives security the Court accepts).
- Substance of interpretation: The Court rejected the appellants' narrower interpretation that, once the tenancy had been determined by notice and the tenants thus became trespassers, amounts accruing thereafter were merely damages for use and occupation (and so outside the term "rent" in Section 114). Instead, the Court held that Section 114 is designed to provide relief against forfeiture and must be read on the assumption that no forfeiture has taken place for the purpose of applying the section. The statutory language uses terms like "lessee" and "rent" on that assumption.
- Practical meaning adopted by the Court: The Court construed "rent" to include the entire amount the tenant would be liable to pay by way of rent up to the date of tender, i.e., treating the tenancy as if it had continued and disregarding defaults for the purpose of determining the deposit required under Section 114. The Court noted that Section 114 requires not only payment of arrears but also interest and full costs, and therefore the "rent" concept must be expansive enough to cover liabilities incurred up to or during the suit.
- Precedential support: The Court referred to Calcutta and Madras authorities (cited above) which support a broad construction of the amounts required to be deposited under Section 114, including views that even amounts barred by limitation may be included.
- Application to facts: The defendants first sought relief under Section 114 only on 21 February 1955, after lengthy litigation and having given up earlier pleas; they had obtained tenders twice but did not deposit the full amount of arrears, interest and costs as the Court below required. The courts below had concluded that the tender made was insufficient and therefore the defendants could not avail themselves of Section 114.
- Equitable discretion and "clean hands": The Court also upheld the reasoning of the courts below that relief under Section 114 is equitable in nature and discretionary. The defendants had pursued numerous procedural pleas, delayed the suit, and only belatedly sought the section's relief while not completing the deposits required. The courts below found that the defendants' conduct disentitled them to equitable indulgence. The present Court found no perversity or unreasonableness in those concurrent findings and declined to interfere with the exercise of discretion.
- Conclusion of analysis: Because the tender/deposit was insufficient under the Court's construction of Section 114 and because the defendants' conduct disentitled them to equitable relief, the defendants could not succeed under Section 114.
Holding and Implications
Holding: The Special Appeal was dismissed. The Court ruled that the defendants could not avail themselves of the relief under Section 114 of the Transfer of Property Act because (a) their deposit/tender was insufficient when measured by the Court's construction of "rent" in Section 114 (which requires the tenant to pay the amount he would be liable for if treated as still a lessee up to the date of tender, together with interest and costs), and (b) in any event the defendants' conduct disentitled them to the equitable relief available under that provision.
DISPOSED OF: Appeal dismissed with costs.
Implications: The direct effect is that the trial court's decree in favour of the plaintiff (for possession, recovery of arrears and damages, and ejectment) was upheld and the defendants were not relieved of forfeiture under Section 114. The Court applied a broad construction of "rent" in Section 114 for the purposes of the statutory remedy and sustained the exercise of judicial discretion by the courts below. The opinion does not state that it establishes any novel binding precedent beyond the reasoning and holdings applied to the facts of this case.
Appeal dismissed.
Beg, J.:— This is a defendant's Special Appeal. It arises out of a suit for arrears of rent and damages and for possession of the land in suit after the removal of the constructions raised thereon by the defendants. The respondent is the landlord of the premises in question. The instrument of lease which is alleged to be the basis of the tenancy of the defendant-appellants was executed on the 20th of July 1943 for a period of 30 years on an annual rent of Rs. 100. One of the terms of the lease was that the lessee would be liable to pay rent every third month, and that, in the event of the lessee failing to comply with this term, he would be liable to ejectment even before the expiry of the period for which the lease was granted, and the lessor would then have the right to get possession of the premises by removal of constructions erected thereon. The rent fell into arrears after the 20th of July 1950 and a sum of Rs. 333/14/- became due for the period 20th of July 1950 to 19th November, 1953. The landlord, accordingly, sent a notice on the 22nd of November, 1953 and demanding the arrears due. The arrears of rent having not been paid the present suit was brought by the plaintiff-respondent for the possession of land after removal of constructions standing thereon, the recovery of the arrears of rent as well as damages from the 20th December, 1953, the date of the determination of the lease, upto the date of the institution of the suit and for ejectment.
2. The suit was contested by the defendants on several grounds. It was alleged that the original contract had been altered by the parties with the result that there was novation of the contract. It was further alleged that under the new contract it was agreed that defendant no. 1 would no longer be the tenant of the plaintiff and the defendant no. 2 would be substituted as the tenant in place of defendant no. 1. Defendant No. 1 was, therefore, no longer liable for rent. Further no valid notice to quit was given to defendant no. 2. The tenancy had not, therefore, been determined and no question of paying damages arose. Pleas relating to undervaluation of the suit and insufficiency of court fee were also taken. The trial court recorded findings in favour of the plaintiff and decreed the suit.
3. The defendants-appellants' first appeal having been dismissed, they filed a second appeal in this Court. The second appeal was dismissed by a single Judge of this Court who, having granted leave to the appellants, this Special Appeal was filed by them.
4. Before us the learned counsel for the appellants has advanced two contentions. The first contention is that the notice of ejectment issued by the respondent was not a valid one; and the second contention is that, in any case, the defendants were entitled to the protection of Sec. 114 of the Transfer of Property Act.
5. The first plea can be disposed of summarily. This plea was given up by the defendants in the trial court. It was not agitated by them either at the stage of first appeal or even at the stage of second appeal. Further, there is no ground mentioning this plea in the memorandum of Special Appeal filed by them. Under the circumstances, we decline to entertain this plea.
6. So far as the second plea is concerned, learned counsel for the appellants has relied on the provisions of Sec. 114 of the Transfer, of Property Act (IV of 1882). Sec. 114 provides as follows:—
“Where a lease of immovable property has determined by forfeiture for non-payment of rent, and the lessor sues to eject the lessee, if, at the hearing of the suit, the lessee pays or tenders to the lessor the rent in arrear, together with interest thereon and his full costs of the suit, or gives such security as the Court thinks sufficient for making such payment within fifteen days, the Court may, in lieu of making a decree for ejectment, pass an order relieving the lessee against the forfeiture; and thereupon the lessee shall hold the property leased as if the forfeiture had not occurred.”
7. The present suit, was filed by the respondent on the 21st of January 1954. After a number of hearings had been gone through, it was fixed for final hearing on the 21st February 1955. It was on that day that the defendants for the first time gave up all the pleas and claimed benefit of Sec. 114 of the Transfer of Property Act. Even then they did not deposit the full amount of arrears of rent together with costs and interests though they had obtained tenders twice for depositing such amount. The courts below were of opinion that in order to entitle the defendants to invoke Sec. 114 of the Transfer of Property Act in their favour they should have deposited the entire amount of arrears of rent which was due from them upto the 21st of February 1955. The contention advanced before us on behalf of the defendants-appellants, is that the notice dated 22nd of November 1953 given by the landlord having determined their tenancy with effect from 20th December, 1953, they became trespassers thereafter. The amount due from them after the 20th December 1953, cannot, therefore, be termed as arrears of rent. What Sec. 114 of the Transfer of Property Act requires is that the tenant should deposit “the rent in arrears, together with interest thereon, and his full costs of the suit.” The contention of the appellants' counsel is that the tenancy having been dissolved by notice, the tenant thereafter became liable only for damages for use and occupation of the premises and not for rent. Under the circumstances, the deposit of the amount made on behalf of the tenant should be deemed to be a sufficient compliance with the provisions of Sec. 114 of the Transfer of Property Act.
8. We are not inclined to accept this interpretation of the term “rent” in Sec. 114 of the Transfer of Property Act. It appears to us that while using the term “rent” in this section the idea of the Legislature was to disregard all defaults and breaches on the part of the tenant and to treat him as a full-fledged tenant for the purposes of the suit. This section is designed to provide a relief against forfeiture. It, therefore, uses terms and phrases on the assumption that no forfeiture has taken place and the tenancy between the parties has continued to subsist. Thus for example the tenant is described in the section as a lessee although, as a result of the notice given by the landlord, the tenancy has been dissolved and the tenant has, therefore, ceased to be a lessee. If, therefore, this section is interpreted in the manner suggested on behalf of the appellants and the notice of ejectment given by the landlord is deemed, to be effective for the purposes of Sec. 114 of the Transfer of Property Act, the word “lessee” used therein will not cover a person whose tenancy has been determined. On this interpretation, therefore, the defendants would be out of Court and would not be able to avail themselves of this section which is relied on by them. The defendants cannot have it both ways.
9. The relief against forfeiture provided in this section is obviously, based on equitable principles. The purpose of this section appears to be to extend a special indulgence in favour of a tenant who is prepared to purge himself of his conduct as a persistent defaulter by making an honest offer to clear off his entire liability. His unconditional readings to wipe off his legal dues is, therefore, made a condition precedent to his prayer that the Court might invoke this section in his favour. A more reasonable construction of this section would, therefore, be to interpret the word “rent” in such a manner as to include in it the entire amount which the tenant would be liable to pay to the landlord by way of rent upto the date of tender. In other words, his liability for rental dues will be determined on the supposition that he had continued to remain as tenant and the forfeiture of his rights following the purported determination of his tenancy had not taken place. This interpretation would also be borne out by the fact that under this section the Legislature required the tenant not only to pay up the arrears of rent but also interest well as full costs of the suit. It would, therefore, appear that this section seeks to make the tenant liable even for the payment of amounts, liability in respect of which is incurred by him as a result of the suit or during its pendency. The view taken by us would also find support from Dhurrumtolla Properties, Ltd. v. Dhunbai Peroshaw A.I.R 1931 Cal. 457.. According to the view taken in some Madras cases even the amount which is barred by the law of limitation should be included in the amount deposited by the tenant, vide Vasudeva Udpa v. Krishna Upda A.I.R 1921 Mad. 418. Gurpur Vamana Pai v. Venkatu Naika A.I.R 1936 Mad. 116. and Janab Vellathi v. Smt. K. Kadervel Thayammal A.I.R 1958 Mad. 232..
10. We would, therefore, hold that the tender made by the tenant being insufficient, he cannot avail himself of the benefit of Sec. 114 of the Transfer of Property Act.
11. The matter can, however, be approached from another angle also. The louver courts have rejected the prayer made on behalf of the appellants as they were not inclined to exercise the discretion vested in them under Sec. 114 of the Transfer of Property Act in their favour. They were of the opinion that the tenants had in the present case forfeited any claim to any equitable consideration at the hands of the court as a result of their conduct, the relief itself being an equitable one, the party who comes to court seeking such relief must come with clean hands. In the present case the suit was filed on the 21st of January 1954. Both the appellants contested the suit on a large number of grounds. They did not claim the benefit of Sec. 114 of the Transfer of Property Act on the first hearing of the suit. On the 7th of July, 1954 both the defendants applied for time to file their written statements, Issues framed on the 11th of August 1954 and 13th of August 1954 was fixed for the hearing of issue no. 3 which related to the valuation of the suit and to the sufficiency of court-fee. After this issue was decided, 9th of December 1954 was fixed for final hearing. On that date the suit was adjourned to 21st of February, 1955 for final hearing upon the ground of illness of appellant no. 2. It was on the 21st of February 1955 that for the first time all the pleas taken by the appellants were given up and they claimed benefit of Sec. 114 of the Transfer of Property Act. Even then they did not deposit the full amount of arrears of rent together with costs and interest, though they obtained tenders twice for depositing such amount. The appellants, therefore, took all kinds of unnecessary vaxatious and frivolous pleas thereby delaying the disposal of the suit and causing harassment to the respondent. It may also be noted in this, connection that in the present case regular payment of rent was one of the terms of the lease. The lessee, therefore, held the land which belonged to the plaintiff on the express condition that rent in respect of the same would be paid regularly, and, in the event of default, he was liable to incur the penalty of having to vacate the premises. In the present case, therefore, the parties themselves had attached special importance to the term relating to regular payment of rent and had also prescribed a penalty for its breach. Under the circumstances, in the present case, the court while decreeing, the suit for ejectment is merely enforcing a term which was a consideration of the contract between the parties and which was agreed to by the tenant himself. The defendants have been found to be clearly in persistent default for over three years. Their conduct throughout cannot be said to be either above board or honest. The trial court, therefore, thought that it was not a fit case for the exercise of the discretionary power of the court in favour of the appellants. The findings of the trial court in this regard were upheld concurrently by two courts. Their conclusions cannot be characterised as either perverse or unreasonable. At any rate, the Court will be loathe to interfere with the exercise of a discretionary power at this that stage. For this reason also we are of opinion that the plea of the appellants based on Sec. 114 of the Transfer of Property Act must be repelled.
12. We, accordingly, see no substance in this appeal and dismiss it with costs.
Appeal dismissed.
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