Samharu Defdt.- v. Dharamraj Pandey And Others Plff.-, Allahabad High Court, Judgment, Law, casemine.com

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Case Number

S.A No. 4063 of 1962

Attorney(S)

K.P. Singh
Bharatji Agarwal

Judges

Jagdish Sahai
Yashodanandan
J.S Trivedi, JJ.

Acts

plaintiffs-respondents.8. Sec. 21(1)(d) of the U.P Zamindari Abolition and Land Reforms Act (herinafter referred to as the Act) reads:21(1).
provisions of the 1939 Act (See Sec. 33 of that Act). Reading sub-Sec. (2) of Sec. 33 of the 1939 Act along with Sec. 251 of the same Act,
provisions of sub-Sec. (2) of Sec. 33 read with Sec. 251 of the 1939 Act. Sec. 251 of the 1939 Act
provisions of the U.P Tenancy Act, 1939 (hereinafter referred to as the 1939 Act)
provisions of the Agra Tenancy Act, 1926
Sub-Sec. (2) of Sec. 33 of the 1939 Act
provisions of U.P Act XX of 1954
provisions of Act II of 1901
TRANSFER OF PROPERTY ACT

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Smart Summary

Factual and Procedural Background

The plaintiffs-respondents filed a suit for ejectment of the defendants from certain agricultural plots, alleging that the plaintiffs were the sirdars of the plots. The complaint stated that about thirty years before the suit, the plaintiffs' ancestors had borrowed Rs. 200 from the defendants' ancestors and had executed an unregistered mortgage deed, on the basis of which the defendants' ancestors were placed in possession. The plaintiffs pleaded that the mortgage debt had been satisfied through the defendants' receipt of profits from the disputed land and thereafter by the defendants themselves; they sought rendition of account and delivery of possession.

The defendants contested the suit inter alia on the ground that they were sub-tenants of the plots under the provisions of U.P. Act XX of 1954 and had, by operation of law, become sirdars (asamis). The trial court dismissed the suit. On appeal, the first appellate court decreed the suit subject to the plaintiffs depositing Rs. 200, finding that the debt had not been satisfied from the usufruct. The defendant-appellant then filed a second appeal, which was ultimately referred to the present Bench.

The sole question before the Court was whether the defendant-appellant was a mere licensee of the plots or had become an asami of them. Counsel for the respective parties—Mr. K.P. Singh (for the defendant-appellant) and Mr. Bharatji Agarwal (for the plaintiffs-respondents)—were heard.

Legal Issues Presented

Whether the defendant-appellant is a mere licensee of the disputed plots or has become an asami (sirdar) thereof under the U.P. Zamindari Abolition and Land Reforms Act (specifically having regard to Sec. 21(1)(d)).
Whether the term "mortgagee" in clause (d) of Sec. 21(1) of the Act is to be confined to persons who are mortgagees by virtue of valid mortgages (in the sense recognised under the Transfer of Property Act), or whether it also embraces mortgage-like transactions which may not be valid under general law (for example, transactions entered into by hereditary tenants who could not validly mortgage their holding under prior tenancy law).

Arguments of the Parties

Defendant-Appellant's Arguments (Mr. K.P. Singh)

The word "mortgagee" in clause (d) of Sec. 21(1) of the U.P. Zamindari Abolition and Land Reforms Act should not be limited to valid/legal mortgages but should also include transactions in the nature of mortgages or akin to mortgages, even if not strictly valid at law.
Relying on clause (iv) of Sec. 19 of the Act, he argued that the statute contemplates protection of categories (such as hereditary tenants) without requiring the same right-to-sell qualification imposed by Sec. 18; thus the legislature, being aware of the 1939 Tenancy Act's restrictions on hereditary tenants creating mortgages, used "mortgagee" in a loose or comprehensive sense to include such transactions.
He suggested that clause (d) of Sec. 21(1) should be read as referring to "a mortgagee in actual possession from a person who is a hereditary tenant" so as to include mortgage-like transactions by hereditary tenants even if they would not be valid under the 1939 Act.

Plaintiffs-Respondents' Arguments (Mr. Bharatji Agarwal)

In the absence of a statutory definition of "mortgage," "mortgagee" and "mortgagor" in the Act, these terms must be given the meaning they have under the Transfer of Property Act; therefore "mortgagee" in clause (d) of Sec. 21(1) should be understood to mean a person who is a mortgagee under a valid mortgage.
The Court should interpret statutory language so as to uphold only valid transactions and generally not give protection to transactions invalid in law.
He referred to provisions of the 1939 Tenancy Act (including Sec. 33(2) read with Sec. 251) and contended that only mortgages by persons permitted to transfer (under saved/exceptional circumstances) would be covered; he observed that Sec. 251 deals with auction sales (not voluntary transfers) and that Sub‑Sec. (2) of Sec. 33 permits transfers only under specific circumstances.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Sukhnandan v. Board of Revenue, 1968 A.W.R. 182	Cited by the defendant to support a broad reading of "mortgagee" under Sec. 21(1)(d).	The Court noted the case but declined to rest its decision solely on this authority; observed that Desai, C.J. did not make a categorical finding on the precise language of Sec. 21(1)(d).
Harkhoo v. Bindeshwar, 1964 R.D. 410	Cited by plaintiffs' counsel among other authorities on interpretation.	Relied upon by counsel; the Court considered this among other cited authorities but did not treat it as decisive in light of its analysis of Secs. 18 and 19.
Bodhan v. Bhundal Singh, 1965 R.D. 23	Cited by plaintiffs' counsel (supporting the narrower meaning of "mortgagee" in earlier decisions).	The Court recorded reliance by counsel; it did not adopt those decisions because the interaction of Secs. 18 and 19 had not been brought to their attention in those cases.
Jagat Narain v. Laljee, 1965 A.L.J. 255	Cited by plaintiffs' counsel in support of the narrower view.	The Court noted the citation but distinguished earlier cases for not having considered the Sec. 18/19 issue now before the Court.
Judhisther Prasad v. Shanti Prasad Shukla, A.I.R. 1955 N.U.C. 4171	Cited by plaintiffs' counsel as authority in the broader corpus of precedents.	The Court acknowledged the citation but treated its own statutory analysis as determinative.
Buddhu Ahir v. Budhram Komhar, F.A.F.O. No. 227 of 1966 (unreported, decided 9-12-1968)	Cited by plaintiffs' counsel among authorities.	Noted as cited; the Court did not rely on it for its ruling and distinguished earlier authorities on factual/statutory grounds.
Sri Ram Sakal Singh v. Dy. Director of Consolidation, 1968 R.D. 456	Cited by plaintiffs' counsel in support of the view that "mortgagee" should be confined to valid mortgages.	Recorded as cited; the Court emphasized that prior decisions did not address the interplay of Secs. 18 and 19 and therefore did not control the present statutory interpretation.
Hamid Hussain v. R.N. Mallah, 1963 R.D. 288	Primary decision relied upon by plaintiffs' counsel: held that "mortgagee" means a person who is a mortgagee by virtue of a valid mortgage deed.	The Court expressly disagreed with this decision, explaining that the Bench in Hamid Hussain had not been made aware of the relevance of Secs. 18 and 19 and therefore the present Court could not follow that view.

Court's Reasoning and Analysis

The Court began by identifying the sole issue: whether the defendant-appellant is a licensee or an asami. It examined the wording of Sec. 21(1)(d) of the U.P. Zamindari Abolition and Land Reforms Act, which deems a person who, on the date preceding vesting, occupied or held land "as a mortgagee in actual possession from a person belonging to any of the classes mentioned in Clauses (b) to (e) of sub‑Sec. (1) of Sec. 18 or clauses (i) to (vii) and (ix) of Sec. 19" to be an asami.

The Court analysed the interplay between Sec. 18 and Sec. 19:

Sec. 18(1)(d) (quoted by the Court) identifies categories of persons who hold land "possessing the right to transfer the holding by sale" (including hereditary tenants under Sec. 18).
By contrast, Sec. 19 (and in particular clause (iv) referring to a hereditary tenant) does not impose the same requirement of possessing the right of sale.

From this statutory juxtaposition the Court inferred that the legislature intended different treatment for hereditary tenants falling under Sec. 18 versus those contemplated under Sec. 19. The Court reasoned that where a hereditary tenant is not subject to the restrictions of clause (d) of Sec. 18 (i.e., need not possess the right to transfer by sale), a mortgage executed by such a hereditary tenant—which might not be valid in the ordinary law of mortgages—could nonetheless bring the mortgagee within Sec. 21(1)(d).

The Court considered the submissions stressing ordinary legal definitions (invoking the Transfer of Property Act), and acknowledged the general principle that courts prefer not to uphold invalid transactions. However, it emphasised that the U.P. Act is not a conventional statute and contains pragmatic provisions that, in certain instances, afford protection even to persons whose title might otherwise be defective (including, in some cases, trespassers or persons with mere entries against the land).

The Court also addressed precedent: it disagreed with the decision in Hamid Hussain v. R.N. Mallah (where a Division Bench held that "mortgagee" requires a valid mortgage) because that Bench had not been informed of or had not considered the significance of Secs. 18 and 19 in interpreting Sec. 21(1)(d). For similar reasons the Court declined to follow other decisions where the Sec. 18/19 interplay had not been placed before the deciding courts.

Having analysed the statutory language and its internal scheme, the Court concluded that the word "mortgagee" in clause (d) of Sec. 21(1) had been used in a comprehensive or loose sense and was not confined only to persons who were mortgagees by virtue of a valid mortgage under the general law.

Applying that interpretation to the facts, the Court found that the defendant-appellant had become an asami (not a mere licensee). Consequently the plaintiffs' ejectment suit was not maintainable.

Holding and Implications

Holding: The Court's principal rulings were as follows:

The defendant-appellant is an asami (sirdar) of the disputed plots and not a mere licensee.
The plaintiffs' ejectment suit is dismissed.
The Court set aside the decree of the first appellate court (which had decreed the suit subject to deposit of Rs. 200) and restored the decree of the trial court which had dismissed the suit. The parties were directed to bear their own costs.
The formal disposition recorded in the opinion is: "Appeal allowed."

Implications:

Direct effect: The plaintiffs lose their ejectment claim; the defendant-appellant retains status as asami. The appellate court's decree in favour of the plaintiffs is set aside and the trial court's dismissal is restored.
No broader precedent beyond this statutory interpretation is explicitly asserted by the Court beyond its reasoning that, on the facts and in light of the statutory scheme (Secs. 18 and 19 read with Sec. 21(1)(d)), the term "mortgagee" may encompass mortgage-like transactions which are not valid under general transfer law when those transactions fall within the categories protected by the Act.
The Court noted that the dismissal of the suit does not bar the plaintiffs from pursuing other remedies: they remain free, if so advised, to seek recovery of Rs. 200 or to seek relief under Sec. 202 of the Act. The Court stated its decision rests on the unsustainability/non-maintainability of the present suit.

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Samharu Defdt.- v. Dharamraj Pandey And Others Plff.-

Jagdish Sahai, J.:— This defendant's appeal has come to us on a reference made by our brother W. Broome and G.C Mathur.

2. The suit giving rise to this appeal was filed by the plaintiffs-respondents for the ejectment of the defendants from certain plots of agricultural land on the allegation that they (the plaintiffs-respondents) were the Sirdars of the plots in suit. It was alleged that about thirty years next preceding the date of the filing of the suit the ancestors of the plaintiffs-respondents had borrowed a sum of Rs. 200/- from the ancestors of the defendants and had executed an unregistered mortgage deed for the same and on the basis of that transaction the defendant's ancestors were put in possession over the land in suit. It has been pleaded that the entire mortgage debt has been satisfied through the receipt of profits of the disputed land by the ancestors of the defendants and thereafter the defendants themselves. Relief of rendition of account and delivery of possession was claimed by the plaintiffs.

3. The suit was contested by the defendants inter alia on the ground that they were sub-tenants of the plots in dispute by virtue of the provisions of U.P Act XX of 1954 and had by the operation of law become Sirdars of the same.

4. The trial court dismissed the suit. On appeal by the plaintiffs the first appellate court decreed the suit, subject to the plaintiffs depositing a sum of Rs. 200/- on the finding that the amount of debt had not been satisfied from the usufruct.

5. The defendant appellant then filed the instant second appeal which came up for hearing before one of us (Yashoda Nandan, J.), who referred it to a larger Bench which referred it to us.

6. The sole question that requires consideration and that has been canvassed at the bar before us is whether the defendant appellant is a mere licensee of the plots in dispute or he has become an Asami thereof.

7. We have heard Mr. K.P Singh for the defendant-appellant and Mr. Bharatji Agarwal for the plaintiffs-respondents.

8. Sec. 21(1)(d) of the U.P Zamindari Abolition and Land Reforms Act (herinafter referred to as the Act) reads:—

“21(1). Notwithstanding anything contained in this Act, every person who, on the date immediately preceding the date of vesting, occupied or held land as—

……………………,

(d) a mortgagee in actual possession from a person belonging to any of the classes mentioned in Clauses (b) to (e) of sub-Sec. (1) of Sec. 18 or clauses (i) to (vii) and (ix) of Sec. 19,

……………………..

shall be deemed to be an asami thereof.”

9. Sri K.P Singh has contended that the word “mortgagee” as occurring in clause (d) of Sec. 21(1) of the Act must not be confined in its meaning to valid or legal mortgages only, but should also include cases in the nature of mortgages or akin to mortgages which, even though not valid, have been entered into as transactions of mortgages. Learned counsel relies upon Clause (iv) of Sec. 19 of the Act which reads:—

“19. All land, held or deemed to have been held on the date immediately preceding the date of vesting by any person as—

……………………..

(iv) a hereditary tenant,

……………………..

shall, save in cases provided for in Clause (d) of sub-Sec. (1) of Sec. 18, be deemed to be settled by the State Government with such person, who shall subject to the provisions of this Act, be entitled except as provided in sub-Sec. (2) of Sec. 18, to take or retain possession as a sirdar thereof.”

10. It is significant to note that this provision does not require a hereditary tenant to possess the right of sale as is required by Sec. 18. Sri K.P Singh contends that clause (d) of Sec. 21(1) of the Act should be read as “a mortgagee in actual possession from a person who is a hereditary tenant.” Learned counsel contends that under the provisions of the U.P Tenancy Act, 1939 (hereinafter referred to as the 1939 Act) a hereditary tenant could not create a mortgage of his holding and if the legislature, even after knowing that legal position, has used the word “mortgagee” in relation to a transaction made by a hereditary tenant, it is obvious that the word “mortgagee” has been used in a loose sense so as to include even mortgages which are not valid in the eye of law.

11. On the other hand Mr. Bharatji Agarwal has forcefully contended that in the absence of the word “mortgage” or “mortgagor” or “mortgagee” having been defined in the Act, we must give to these terms the same meaning which they had in the Transfer of Property Act with the result that the expression “mortgagee” as used in clause (d) of Sec. 21(1) of the Act can only mean a person who is a mortgagee on the basis of a valid mortgage. Mr. Bharatji Agarwal submits that the Court must so interpret the word as to uphold only valid transactions and that normally a court should discountenance transactions which are invalid in the eye of law. The argument in a general way can be considered to have some force, but it is well known that the Act has in several instances given protection even to trespassers or to persons whose only claim to the plots claimed by them is the entry of their names in respect thereof.

12. The Act is not a conventional legislation, but has taken in view practical and pragmatic considerations also.

13. We would have found force in the submissions of Sri Bharatji Agarwal if we had not been cognisant of the provisions of Sec. 18(1)(d) of the Act. That provision reads:—

“18(1). Subject to the provisions of Secs. 10, 15, 16 and 17 all lands—

(d) held as such by— (i) an occupancy tenant, (ii) a hereditary tenant, (iii) a tenant of patta dawami or istamrari referred to in Sec. 17. possessing the right to transfer the holding by sale.

14. It is clear that hereditary tenant under the provisions of Sec. 18 of the Act must possess the right to transfer the holding by sale. No such restriction is imposed upon a hereditary tenant under Sec. 19 of the Act. The result that follows from this is that if a hereditary tenant who is not subject to the restrictions contained in clause (d) of Sec. 18 has made a mortgage, which is not valid, then the mortgagee would come to acquire rights under Sec. 21(1)(d) of the Act.

15. It is true that under the provisions of Act II of 1901 as also under the provisions of the Agra Tenancy Act, 1926 an occupancy tenant or a non-occupancy tenant (We are not concerned with ex-proprietary tenant) could not transfer his holding with the result that he could not execute mortgage deeds or enter into transactions which resulted in the mortgage of the holding. This bar continued also under the provisions of the 1939 Act (See Sec. 33 of that Act). Reading Sub-Sec. (2) of Sec. 33 of the 1939 Act along with Sec. 251 of the same Act, Mr. Bharatji Agarwal contended that under certain circumstances a hereditary tenant could sell or mortgage his holding and therefore only mortgages by the persons who could so held be saved under the provisions of sub-Sec. (2) of Sec. 33 read with Sec. 251 of the 1939 Act. Sec. 251 of the 1939 Act does not deal with a voluntary transfer, but only with auction sales. Sub-Sec. (2) of Sec. 33 of the 1939 Act no doubt permits transfers under certain circumstances, but having examined the language of clause (d) of Sec. 21(1) of the Act we are of the opinion that the word “Mortgagee” has been used therein in a comprehensive or a loose sense and the expression is not confined only to a valid mortgage. This view of ours is founded upon an analysis of the provisions of Secs. 18 and 19 of the Act which we have made earlier in this judgement.

16. Learned counsel for the parties have placed reliance upon certain decisions in support of their respective contentions. Mr. K.P Singh has placed reliance upon Sukhnandan v. Board of Revenue 1968 A.W.R 182.. Mr. Bharatji Agarwal has placed reliance upon Harkhoo v. Bindeshwar 1964 R.D 410., Bodhan v. Bhundal Singh 1965 R.D 23., Jagat Narain v. Laljee 1965 A.L.J 255., Judhisther Prasad v. Shanti Prasad Shukla A.I.R 1955 N.U.C 4171., an unreported decision of Rajeshwar Prasad and A.K Kirty, JJ. in Buddhu Ahir v. Budhram Komhar F.A.F.O No. 227 of 1966 decided on 9-12-1968., Sri Ram Sakal Singh v. Dy. Director of Consolidation 1968 R.D 456. and Hamid Hussain v. R.N Mallah 1963 R.D 288..

17. The main decision in favour of Mr. Bharatji Agarwal's contention is Hamid Hussain v. R.N Mallah where a Division Bench of this Court took the view that the word “mortgagee” means a person who is a mortgagee by virtue of a valid mortgage deed. That decision has been followed in other cases relied upon by Mr. Bharatji Agarwal. With great respect to the learned Judges who decided Hamid Hussain v. R.N Mallah we find ourselves in disagreement with the view that they have taken. We may point out that the provisions of Secs. 18 and 19 of the Act were not brought to the notice of the learned Judges and the paint that has been canvassed before us that a mortgage deed executed by a hereditary tenant though not valid in the eye of law has been accepted by the legislature in clause (d) of Sec. 21(1) of the Act was not raised before the learned Judges. Inasmuch as in the other cases on which Mr. Bharatji Agarwal has placed reliance this aspect of the matter was not placed, we are unable to agree with those decisions also.

18. Coming to Sukhnandan's case, we would like to say that we do not wish to base our decision only on the authority of that case. In the first place there was no categorical finding on the basis of the language of Sec. 21(1)(d) of the Act by Desai, C.J that even a person who has become a mortgagee by virtue of an invalid transaction of mortgage would be comprehended in the word “mortgagee” as used in clause (d) of Sec. 21(1) of the Act. Secondly Desai, C.J was considering whether or not a mistake apparent on the face of the record had been committed, when a contrary view was taken, in the order impugned before him.

19. For the reasons mentioned above we are of the opinion that in the instant case the defendant-appellant is an Asami and not a mere licensee of the plaintiffs-respondents. In that view of the matter the suit of the plaintiffs-respondents is bound to fail. We, therefore, set aside the decree passed by the first appellate court and restore that of the trial court, but in the circumstances of the case we direct the parties to bear their own costs.

20. We would like to add that the dismissal of the suit would not bar the plaintiffs-respondents, if so advised, from seeking any other remedy either for the recovery of a sum of Rs. 200/- or for an order or decree under Sec. 202 of the Act. Our decision rests on the circumstance that the suit was not maintainable.

Appeal allowed.

Samharu Defdt.- v. Dharamraj Pandey And Others Plff.-

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Defendant-Appellant's Arguments (Mr. K.P. Singh)

Plaintiffs-Respondents' Arguments (Mr. Bharatji Agarwal)

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Samharu Defdt.- v. Dharamraj Pandey And Others Plff.-

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