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Palaniswamy Gurukkal... v. Kandappa Goundar .

Madras High Court
Mar 9, 1967
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Structured Summary of the Opinion (Sadasivam, J.)

Factual and Procedural Background

This civil revision petition arose from an application under Section 3(4)(a)/(b) of the Madras Cultivating Tenants Protection Act, 1955 concerning eviction of a cultivating tenant for non-payment of rent. The petition came before the Division Bench because Alagiriswami, J., who initially heard the matter, had difficulty agreeing with a decision of Kailasam, J. in Nallathambi v. Nagaratnasami Devastanam (ILR (1965) 2 Mad 225) and had relied upon the Privy Council decision in Hansraj Gupta v. Official Liquidators (ILR 54 All 1067 : AIR 1933 PC 63). The central practical question was whether a revenue Court (through the Revenue Divisional Officer) exercising jurisdiction under Section 3(4)(b) of the Act can direct a cultivating tenant to deposit the entire arrears of rent, including portions that are time-barred and could not be recovered in a civil suit for arrears of rent.

Procedurally, the Court reviewed the statutory scheme of Section 3 (sub-sections (1) to (4)) and considered analogous equitable doctrines and authorities about relief against forfeiture and payment of time-barred arrears. The Court ultimately set aside the order of the Revenue Divisional Officer, directed the respondent (the tenant) to pay the entire arrears of rent excluding amounts already deposited within one month, and ordered eviction on failure to comply. The petition was allowed and costs were awarded to the petitioner.

Legal Issues Presented

  1. Whether a revenue Court, under Section 3(4)(b) of the Madras Cultivating Tenants Protection Act, 1955, has jurisdiction to direct a cultivating tenant to deposit the entire arrears of rent even if part of those arrears is time-barred and could not be recovered in a civil suit for arrears of rent.
  2. Whether limitation (specifically Article 137 of the Limitation Act, 1963, as relied upon by the respondent) prevents a revenue Court from ordering deposit of arrears that pre-date the limitation period when deciding an eviction application under Section 3(4)(a)/(b) of the Act.

Arguments of the Parties

Respondent's Arguments

  • The learned Advocate for the respondent relied on Article 137 of the Limitation Act, 1963 and argued that an application for eviction based on default in payment of rent prior to three years would be barred by that Article; therefore, the revenue Court could not order the deposit of such time-barred arrears.

The opinion does not contain a detailed account of other specific pleaded arguments of the parties (for example, the petitioner's detailed submissions are not separately set out in the text).

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Nallathambi v. Nagaratnasami Devastanam, ILR (1965) 2 Mad 225 (Kailasam, J.) Held that absence of any provision restricting arrears to three years justified directing the tenant to pay entire arrears; held no period of limitation for filing petition under Section 3(4)(a) of the Act (per Kailasam, J.). The Court considered Kailasam, J.'s reasoning and referenced it favourably; the present opinion aligns with the view that a revenue Court can require deposit of entire arrears.
Hansraj Gupta v. Official Liquidators of Dehra Dun etc. Co., ILR 54 All 1067 : AIR 1933 PC 63 (Privy Council) Held a liquidator could not use a summary procedure (Section 186 Companies Act) to overcome limitation; time-barred debt could not be enforced by summary order under that statutory procedure. The Court held this decision distinguishable and not instructive for the Section 3(4)(b) issue; it did not follow Hansraj Gupta as controlling here.
Barrant v. Richardson and Cresswell, (1930-1) 1 KB 686 Authority for the proposition that an assignee seeking relief against ejectment must pay arrears of rent, including arrears outside the period of limitation. Used as an authority for the equitable practice that relief from forfeiture/ejectment requires payment of all arrears including time-barred amounts.
Dhurumtolla Properties Ltd. v. Dhunbai Peroshaw Sorabjee, ILR 58 Cal 311 : AIR 1931 Cal 457 Explained Section 114 Transfer of Property Act as based on Chancery principles; under Indian law relief from forfeiture cannot be claimed after an ejectment order; lessee must compensate lessor by paying arrears including time-barred. Cited to show the Indian approach to relief against forfeiture and to support the proposition that full arrears (including time-barred) are a condition for relief.
Vasudeva Udpa v. Krishna Udpa, ILR 44 Mad 629 : AIR 1921 Mad 418 Held tenant can be relieved against forfeiture only on payment of all arrears, including rents barred by limitation. Relied on as direct precedent supporting the principle that courts grant relief against forfeiture only upon payment of all arrears, including time-barred sums.
Vasanta Pai v. Venkatu Naika, 1936 Mad WN 83 : AIR 1936 Mad 116 Held that "rent in arrears" in Section 114 Transfer of Property Act includes rent barred by limitation and that such rent must be paid before relief against forfeiture is granted. Used to reinforce the proposition that arrears outside limitation still form part of the amount required to obtain relief against forfeiture.
Vellathi v. Thayammal, AIR 1958 Mad 232 Held that courts have power to give relief against forfeiture independently of Section 114; equitable relief can require payment of time-barred arrears as a condition of relief. Cited to demonstrate that even where Section 114 does not strictly apply (e.g., agricultural holdings), courts may, in equity, require payment of time-barred arrears to grant relief against forfeiture.
Narasingh Das v. Permeshwari Das, AIR 1962 All 65 Referred to the principles in the above cases in support of granting relief only upon payment of full arrears. Noted as a decision that cited and applied the cited principles; offered supporting authority for the Court's position.
Venkatachala Odavar v. Ramachandra Odayar, 1961-1 Mad LJ 188 : AIR 1961 Mad 423 Illustrated that questions of arrears and the landlord's right to recover them are not matters the RDO is empowered to determine finally but may arise incidentally when deciding eviction. Cited to clarify the limited scope of the Revenue Divisional Officer's powers — that determination of recoverable arrears is incidental to the eviction inquiry, not a separate recovery proceeding.

Court's Reasoning and Analysis

The Court's analysis proceeded by close textual and structural examination of Section 3 of the Madras Cultivating Tenants Protection Act, 1955 and by drawing on established equitable principles governing relief against forfeiture.

  1. Statutory scheme: The Court parsed Section 3 sub-sections (1)–(4). Section 3(1) generally protects cultivating tenants from eviction except as provided in subsequent sub-sections. Section 3(2) carves out cultivating tenants who default in payment of rent from that protection. Section 3(3) allows a cultivating tenant to make specified deposits to preserve exemption from eviction. Section 3(4)(b) expressly empowers the Revenue Divisional Officer, in the exercise of judicial discretion, to allow a tenant "such time as he considers just and reasonable" to deposit arrears payable under the Act inclusive of costs; if the tenant deposits as directed he is deemed to have paid the rent under Section 3(3)(b).
  2. Nature of Section 3(4)(b) relief: The Court treated Section 3(4)(b) as a statutory analogue to equitable relief against forfeiture known to Chancery and subsequently codified in Section 114 of the Transfer of Property Act. The Court reasoned that sub-section (4)(b) gives the Revenue Divisional Officer jurisdiction to afford relief to tenants who have failed to pay rent or to make deposits under Section 3(3), similar to the power of civil courts to relieve tenants from forfeiture upon payment of arrears and costs.
  3. Role of equitable authorities and textual support: The Court cited legal treatises (Woodfall; Halsbury; Mullah) and a series of decisions (including Vasudeva Udpa, Vellathi, Vasanta Pai, Dhurumtolla) to show that the established equitable practice in India has been that relief against forfeiture is conditioned on payment of all arrears, including time-barred arrears. The Court relied on those authorities to conclude that when granting relief to avoid eviction, a court (or, by analogy, the Revenue Divisional Officer under the Act) may require deposit of entire arrears.
  4. Distinguishing contrary authority: The Privy Council decision in Hansraj Gupta (concerning a liquidator under Section 186 of the Companies Act) was distinguished. That decision held a liquidator could not obtain recovery of time-barred debts by a summary procedure; the Court found the Companies Act summary remedy different in character from an eviction application under Section 3 of the Act, and thus Hansraj Gupta did not control the present question.
  5. Limitation argument: The Court rejected the respondent's submission based on Article 137 of the Limitation Act, 1963. The Court held the cause of action for eviction is the tenant's default up to the date of the eviction application, so whether earlier arrears are three years old or older is immaterial to the power to require deposit. The Court also noted that even if Article 137 were assumed to apply, it would not alter the result reached in the context of Section 3(4)(b).
  6. Discretion limited to temporal relief: While the Court concluded the Revenue Court has jurisdiction to direct deposit of entire arrears (including portions barred for recovery in a civil suit), the Court clarified that Section 3(4)(b) confers discretion only to allow reasonable time for deposit; it does not permit the RDO to alter the quantum of arrears required to avoid eviction. In other words, the RDO's judicial discretion concerns timing and conditions (including costs), not reducing or excusing portions of arrears.
  7. Practical justice: The Court acknowledged that directing payment of arrears beyond limitation imposes a heavy burden on a tenant, but reasoned that a tenant who has long defaulted cannot claim equitable indulgence to avoid eviction: if the revenue authority still elects to exercise discretion in favour of such a tenant, it is reasonable to require payment of the full arrears as a condition of relief.

Holding and Implications

Holding: The Court held that the Revenue Court (through the Revenue Divisional Officer) has jurisdiction under Section 3(4)(b) of the Madras Cultivating Tenants Protection Act, 1955 to direct a cultivating tenant to deposit the entire arrears of rent as a condition of avoiding eviction, even if part of those arrears is time-barred and could not be recovered in a civil suit for arrears of rent.

Implications and immediate consequences:

  • The Court clarified that the discretion vested in the Revenue Divisional Officer by Section 3(4)(b) relates to allowing reasonable time for deposit and setting conditions (including costs) but does not extend to reducing the extent or quantum of the arrears required to be deposited.
  • On the facts before the Court, the earlier order of the Revenue Divisional Officer was set aside. The respondent (tenant) was directed to pay the entire arrears of rent, excluding amounts already deposited, within one month of the lower Court receiving the order; failure to do so would result in eviction.
  • The petitioner (landlord) was awarded the costs of the petition. The petition was allowed.
  • No broad new principle of law beyond the direct holding was announced; the decision applies the statutory scheme of Section 3 coupled with established equitable principles governing relief against forfeiture to the present statutory context. The opinion distinguishes inapposite authority (Hansraj Gupta) and relies on a line of cases and doctrinal texts to apply existing principles to Section 3(4)(b).
Order reference in opinion: The order of the Revenue Divisional Officer was set aside and directions made for deposit of entire arrears (excluding sums already deposited) within one month; eviction on non-payment; costs to petitioner. Petition allowed.

This summary is based exclusively on the information contained in the provided opinion. No facts or holdings beyond those stated in the opinion have been added.

Show all summary ...

Sadasivam, J.:— This civil revision petition has come before us as Alagiriswami, J., who heard it in the first instance, found some difficulty in agreeing with the decision of Kailasam, J., in Nallathambi v. Nagaratnasami Devastanam, ILR (1965) 2 Mad 225 particularly in view of the decision of the Privy Council in Hansraj Gupta v. Official Liquidators of Dehra Dun etc. Co. ILR 54 All 1067 : (AIR 1933 PC 63). The civil revision petition raises an important question, whether a revenue Court has jurisdiction in an application for eviction by a landlord to direct a cultivating tenant u/S. 3(4)(b) of the Madras Cultivating Tenants Protection Act 1955, to deposit the entire arrears of rent, irrespective of the fact that part of it may be time-barred and cannot be recovered in a suit for arrears of rent in a civil Court.

2. In the decision in ILR (1965) 2 Mad 225, Kailasam, J. has referred to the several clauses of Section 3 of the Madras Cultivating Tenants Protection Act 1955 hereinafter referred to as the Act, and found that in the absence of any provision restricting the arrears of rent of three years prior to the date of the application, there is no justification for holding that the arrears of rent which the revenue Court could direct the tenant to pay or deposit shall be confined to the said period. The scheme of Section 3 of the Act, as revealed from the several clauses found therein, also furnishes some guidance to answer the question involved in this civil revision petition. Sub-section (1) of Section 3 of the Act provides that “no cultivating tenant shall be evicted from his holding or any part thereof by or at the instance of his landlord, whether in execution of a decree or order of a Court or otherwise”, except in accordance with the provisions of the succeeding sub-sections. Sub-section (2) of the Section 3 of the Act provides that subject to the next succeeding sub-section, namely, sub-section (3), cultivating tenants falling under that sub-section cannot claim the exemption from eviction conferred on cultivating tenants under Section 3(1) of the Act. One of such cultivating tenants is one who defaults to pay rent prior to, or after the commencement of the Act.

3. In the areas where the Tanjore Tenants and Pannaiyal Protection Act 1952 was in force prior to the coming into force of the Madras Cultivating Tenants Protection (Amendment) Act 1956, a tenant if in arrears at the commencement of the Act, should pay such rent within six weeks after such commencement and in respect of subsequent rent, he should pay rent within a month after such rent becomes due. Cultivating tenants in other areas of the State of Madras, such as the one in the present case, should pay the arrears of rent accrued subsequent to 31-3-1954 within a month after the commencement of the Act and the rent payable after the commencement of the Act within a month after such rent becomes due.

4. Sub-section (3) of Section 3 of the Act enables a cultivating tenant to make a deposit of the rent accrued due subsequent to 31st March 1954, within a month after the commencement of the Act and the rent accrued due after the commencement of the Act within a month after the date on which the rent accrued due. This is in accordance with the terms of the earlier clauses. Thus having regard to sub-sections (2) and (3) of Section 3 of the Act, a cultivating tenant shall be liable to be evicted if he failed to pay the rent accrued due after the commencement of the Act within a month after the date on which the rent accrued due.

5. Logically sub-section (4) of Section 3 provides a remedy for the landlord to file an application for eviction in the Revenue Court against such cultivating tenant who defaults to pay rent. Clause (b) of sub-section (4) of Section 3 of the Act enables the Revenue Divisional Officer in the exercise of his judicial discretion to allow a cultivating tenant such time as he considers just and reasonable having regard to the relative circumstances of the landlord and the cultivating tenant for depositing the arrears of rent payable under the Act inclusive of such costs as he may direct, and if the cultivating tenant deposits the same as directed he shall be deemed to have paid the rent under sub-section (3)(b) of Section 3 of the Act. Thus sub-section (4)(b) of Section 3 of the Act gives jurisdiction to the Revenue Divisional Officer to afford relief to a cultivating tenant, who not only failed to pay rent in time, but also failed to make the deposit as provided under sub-sec. (3) of Section 3 of the Act and thereby precluded himself from claiming exemption from eviction under sub-section (1) of Section 3 of the Act. This is analogous to the right of civil Courts to relieve a tenant against forfeiture clauses of lease deeds, whether under Section 114 of the Transfer of Property Act or under the general law.

6. It is clear from paragraph 2068 at page 950 of Woodfall on Landlord and Tenant', 26th Edn. Volume 1, that in the case of the breach of the covenant to pay rent, equitable relief was granted from early times, the statute 4 Geo 2 C. 28 only regulating the mode of granting the relief and not originating it. The Supreme Court of Judicature (Consolidation) Act 1925, Section 46 (replacing the Common Law Procedure Act 1860 Section 1) allows a Court or a Judge to give relief in a summary manner and subject to the same terms and conditions in all respects as to payment of rent, costs and otherwise as could formerly have been enforced by the Court of Chancery. (See pages 970 of the same book Para 2014).

7. I It is stated in paragraph 1409 at page 681 of Halsbury's Laws of England, 3rd Edn. Volume 23, that “if the landlord has brought an action to recover possession, the tenant or his assigns may, at any time before trial, pay or tender to the landlord, or pay into Court, all the rent in arrears, together with costs; thereupon all further proceedings are stayed, and the tenant or his assigns hold the demised lands under the lease, without any new lease”. It appears from the foot-note in respect of the above statement of law that in order that an assignee may obtain relief against an order in ejectment, it is necessary that he should pay or tender not only the amount due from him, but also the amount of rent due from the original lessee, his assignor, including arrears outside the period of limitation. Barrant v. Richardson and Cresswell, 1930-1 KB 686, has been cited as the authority for the position.

8. In the Dhurumtolla Properties Ltd. v. Dhunbai Peroshaw Sorabjee, ILR 58 Cal 311 : (AIR 1931 Cal 457), it has been held that Section 114 of the Transfer of Property Act, is based on principles laid down by the Chancery Courts in England and that the only difference is that, under the English law, a tenant is allowed the same right to relief after a judgment for recovery of land on the ground of forfeiture for non-payment of rent, as if the judgment had been given after trial, while under the Indian law relief from forfeiture cannot be claimed after the order for ejectment has been made. Section 114 of the Transfer of Property Act provides for relief against forfeiture for non-payment of rent. But such relief was given in India even before the Transfer of Property Act it is given in respect of agricultural holdings to which the Transfer of Property Act is not applicable. It is clear from page 754 of Mullah's Transfer of Property Act (5th Edn.) that the lessee is put on terms' to make full compensation to the lessor, i.e, he must pay all rent in arrears with interest and full costs of the lessors suit. It is pointed out by the learned author that the Madras High Court has held that the lessee must pay arrears of rent even though they are rime-barred.

9. In Vasudeva Udpa v. Krishna Udpa, ILR 44 Mad 629 : (AIR 1921 Mad 418), it has been held that a tenant can be relieved against forfeiture of lease incurred by non-payment of rent only on payment of all arrears of rent, including such as may be barred by limitation. In Vasanta Pai v. Venkatu Naika, 1936 Mad WN 83 : (AIR 1936 Mad 116). Venkataramana Rao, J., has held that the words rent in arrears' in Section 114 Transfer of Property Act are wide enough to include even the rent which the lessor may be unable to recover by reason of the bar of limitation. He has also pointed put that before forfeiture can be relieved against ‘rent in arrears’ must be paid.

10. In Vellathi v. Thayammal, AIR 1958 Mad 232, it has been held by a Bench of the Court that the Court has power to give relief against forfeiture independently of the provisions of Section 114 of the Transfer of Property Act and that therefore, though an agricultural lease does not come within the purview of the section, a Court in the exercise of its powers, if justice, equity and good conscience, requires it, will relieve the tenant against forfeiture for non-payment of rent on such conditions as may appear equitable on the facts or each particular case. In that particular case, the Court granted relief against forfeiture by directing the tenant to pay time-barred arrears of rent, though the same were not claimed in the suit. It was held that such direction was fully warranted by considerations of justice, equity and good conscience under which the relief against forfeiture was granted. In Narasingh Das v. Permeshwari Das, AIR 1962 All 65, a Bench of the Allahabad High Court referred to the principles of the above decisions in support of the decision in that case.

11. Thus, in exercising the discretion under Section 3(4)(b) of the Act, the Revenue Court has jurisdiction to direct a cultivating tenant to deposit the entire arrears of rent irrespective of the fact that part of it is time-barred, in order to give relief to the cultivating tenant from being evicted from his holding.

12. The Privy Council decision in ILR 54 All 1067 : (AIR 1933 PC 63), relied on by Alagiriswami, J., in his order of reference is clearly distinguishable and it can hardly furnish any guidance to answer the question that arises for consideration in this civil revision petition. It was held in that decision that the liquidator of a company could not by making an application under Section 186 of the Companies Act get over the period of limitation, which would apply if he were to bring a regular suit in the company's name to recover moneys from a contributory. The principle of the decision is that a time-barred debt could not be enforced by a summary order under Section 186 of the Companies Act of 1913, as the section did not create new liabilities or confer new rights, but merely created a summary procedure for ??? existing liabilities.

13. But it should be noted that an application by a landlord under Section 3(4)(a) of the Act is an application for eviction of the tenant in a revenue Court, which is totally different from a suit for recovery of rent in a civil Court. As pointed out in Venkatachala Odavar v. Ramachandra Odayar, 1961-1 Mad LJ 188 : (AIR 1961 Mad 423), it is obvious that the question of arrears of rent of a cultivating tenant and the right of the landlord to recover such arrears from the tenant are not matters which the Revenue Divisional Officer is empowered under the Act to determine, but are matters which may arise incidentally in determining the question whether the cultivating tenant is liable to be evicted or not.

14. The learned Advocate for the respondent relied on Article 137 of the Limitation Act of 1963 as applying to an application of the landlord under Section 3(4)(a) of the Act and urged that an application for eviction based on default in payment of rent prior to three years would be barred by virtue of the Article and hence such arrears of rent could not be ordered to be deposited by the revenue Court. There is a fallacy in this contention. The cause of action to apply for eviction is the default in payment of rent upto the date of the application and it is really immaterial whether such arrears is for three years, or less, or more.

15. In Woodfall on “Landlord and Tenant” 26th Edn. Volume 1, it is stated at page 568 in paragraph 881, on the authority of (1930) 1 KB 686, that where a lessor had under the lease a right of re-entry when the rent was in arrear for 21 days and the assignee of the lease was/in possession of the land, no rent having been paid for over 12 years, it was held that the lessor's claim to possession was not barred as not having been made within 12 years next after the time at which the right to make such reentry had first accrued, but that his right to re-enter accrued afresh in respect of each subsequent quarter day whenever any part of the rent reserved was in arrear for 21 days, and he was therefore entitled to rely on the last nonpayment of rent before writ issued or any previous non-payment of rent upto 12 years before writ. Hence the landlord may waive and not rely on earlier defaults in payment of rent during the period prior to 3 years for claiming eviction by virtue of the Limitation Act, the right to demand rent prior to 3 years might get barred. But even such barred arrears of rent could form a valid consideration for a promissory note or other fresh contract in writing under Section 25 of the Contract Act.

16. Kailasam, J. in ILR (1965) 2 Mad 225, has held that there is no period of limitation for the landlord to file a petition for eviction under Section 3(4)(a) of the Act as the Limitation Act of 1908 does not provide for any period to an application for eviction by the landlord under the Act Even the present petition by the landlord was filed in the Revenue Court, when the Limitation Act of 1908 was in force. But in the light of our discussion, it would not make any difference even if Article 137 of the Limitation Act of 1963 is assumed to apply to an application for eviction by a landlord against a cultivating tenant under Section 3(4)(a) of the Act.

17. In the result, we are of the opinion that the Revenue Court has jurisdiction to direct the cultivating tenant to pay the entire arrears of rent in order to avoid being evicted from his holding. But, as already pointed out, Cl. (b) of sub-section (4) of Section 3 of the Act enables the Revenue Divisional Officer in the exercise of his judicial discretion to allow a cultivating tenant such time as he considers just and reason able having regard to the relative circumstances of the landlord and the cultivating tenant for depositing the arrears of rent payable under the Act inclusive of such costs as he may direct, and if the cultivating tenant deposits the same as directed, he shall be deemed to have paid the rent under sub-section (3)(b) of Section 3 of the Act. The exercise of judicial discretion is only as regards allowing the cultivating tenant reasonable time to make the deposit of arrears of rent and not as regards the extent or quantum of arrears.

18. In ILR 44 Mad 629 at p. 631 : (AIR 1921 Mad 418) (at pp. 419, 420), it is pointed out that the tenant should not be given relief against forfeiture until the full arrears are paid, the full arrears being probably limited to 12 years but having regard to the provisions of the Act, arrears of rent as subsequent to 31st March 1954, alone could be directed to be deposited. It is true that a direction by the Revenue Court to a cultivating tenant to pay arrears of rent for a number of years beyond the period of limitation would impose a heavy burden on him. But the answer to this contention is that such a tenant who has defaulted to pay rent for a long period is not really entitled to ask the Revenue Court to exercise its discretion of not evicting him from his holding at the instance of the landlord. If in spite of it the Revenue Court thinks it fit to exercise its discretion even in the case of such a tenant, it is but reasonable that he should be asked to pay the entire arrears of rent which he would have to pay to avoid eviction on the ground of non-payment of rent. The order of the Revenue Divisional Officer is therefore incorrect and it is set aside. The respondent is directed to pay the entire arrears of rent excluding the amount already deposited by him within one month from the date of receipt of this order in the lower Court, and on his failure to do so, he shall be evicted. The petitioner is entitled to costs of this petition.

TVN/D.V.C

19. Petition allowed.