Kanhaiya Singh, J.:— This is an appeal from the judgment and decree of the Additional District Judge of Gaya dated the 18th January, 1950, affirming the decision of the Additional Subordinate Judge of Gaya dated 20th January, 1949, under which the suit of the plaintiff-respondent for possession was decreed. The plaintiff in this case is the Gaya District Board, and the suit relates to 13 bighas of land in village Shamser Nagar in the district of Gaya. The Chairman of the District Board settled this land with the defendant at an annual rental of Rs. 195/- in the first instance for five years with effect from 1-7-33 and again on the expiry of the first term for another period of five years with effect from 1-4-1939, on each occasion by a registered deed of lease dated, respectively, 3-11-34 and 5-12-40.

2. On the expiry of the term of the second lease on 31-3-44 the plaintiff, it was alleged, entered into possession and remained in possession from 31-3-44 to 12-4-44 when the land was settled with one Chetawan Pandey by auction for five years with effect from 13-4-44 at an annual rental of Rs. 221/-. A dispute about possession arose between Chetawan Pandey and the defendant culminating in a proceeding under Section 144 of the Cr PC which eventually terminated in favour of the defendant. Thereupon, the plaintiff brought the suit on 7-12-46 for possession with mense profits substantially on the grounds that this land formed part of the road known as Baroon Bhaneria Inglish Road, the part of the road comprising the suit land being commonly called side cutting lands' meant for the repair of the road and its flanks, that the settlement with the defendant was purely for a temporary period, that the settlement was invalid because the Chairman had no authority to make the settlement and the deed of lease was not executed in accordance with law, that the defendant was a mere licensee and that he had no right to remain on the land and was liable to be ejected.

3. The defendant admitted the two settlements alleged by the plaintiff, but opposed the plaintiff's suit on two main grounds: first, that he was the settled raiyat of the village and had acquired rights of occupancy in the suit land, and, secondly, that even if the settlements be taken to be invalid as being unauthorised he had acquired occupancy right by prescription by virtue of his adverse possession for more than twelve years. It was denied that the disputed land formed part of the side cutting lands Appertaining to the Baroon Bhaneria Inglish Road. It was alleged that it was an agricultural land meant for the purposes of cultivation. Both the Courts concurrently found that the leases in favour of the defendant were invalid and void for lack of authority in the Chairman and conferred no tide on the defendant. They held further that the defendant was continuously in possession of the disputed land since after the first settlement, that is to say, since after 1-7-33, but this possession was not sufficient to sustain the defence of acquisition of occupancy rights, as his possession was not as a raiyat but as a mere licensee. They accordingly decreed the plaintiff's suit. The defendant has come up in Second Appeal.

4. On behalf of the appellant the learned Government Advocate contended that on the findings of the Court below the plaintiff should have been unsuited. The argument put forward by him is that if the leases were invalid, the possession of the defendant was as a trespasser, and as he had been in possession of the disputed land continuously for more than twelve years, he had acquired rights of occupancy in the suit land by prescription.

5. So far as the invalidity of the leases is concerned, the learned Government Advocate did not seriously dispute the findings of the Court below. The District Board is a body corporate and, therefore, all transactions entered into by the Board must: of necessity be in accordance with the provisions of the law, and the rules framed thereunder. Section 29 of the Bihar and Orissa Local Self Government Act, 1885, as amended from time to time (hereinafter referred to as the Act), provides as follows:

“Every District Board shall be a body corporate by the name of the District Board of the district by reference to which it is known, and shall have perpetual succession and a common seal, with power to acquire and hold property both movable and immovable and subject to any rules made under this Act, to transfer any such property held by it, and to do all other things necessary for the purpose of the Act, and may sue and be sued in its corporate name”.

6. The District Board has no doubt power to acquire and hold property, both movable and immovable, but in the matter of disposal of its property the power is not as wide; it has been made subject to the rules framed under the Act. By virtue of the powers vested in it under section 138 of the Act, the State Government has framed rules providing for the manner in which the contracts and the transfers of property may be effected on behalf of the District Board. Rules 93, 94 and 103 of the Act are relevant for the present purpose. They are to the following effect;

“93. No immovable property vested in a District Board, shall, except with the previous approval of the Local Government, and in such manner and on such terms and conditions as that Government may approve, be transferred by the Board by way of sale, or by way of mortgage, charge or exchange or otherwise than by way of lease, without a premium”.

“94. A lease of immovable property vested in a District Board may be made by the Board, without a premium, on the conditions following:

(a) That a reasonable annual rent be reserved and made payable during the whole of the term of the lease; and

(b) That the lease or agreement for the lease be not made for any term without the previous sanction of the Board at a meeting, or for any term exceeding five years and not exceeding thirty years, without the previous approval of the Commissioner of the Division, or for any term exceeding thirty years without the previous approval of the local Government”.

“103. Every contract or agreement entered into by any District Board in respect of a sum, or involving a value, above Rs. 500/- shall be sanctioned at a meeting, be in writing, be signed by the Chairman and two other members of the District Board, and shall be sealed with the common seal of such District Board. Unless so sanctioned and executed, such contract shall not be binding on the District Board”.

7. The combined effect of these rules is that all leases without premium and reserving an annual rent in respect of lands involving a value, above Rs. 500/- as in the present case, must be under the common seal and be signed by the Chairman and two of the members of the Board. The requirement of the common seal is imperative, for the simple reason that in respect of a corporation, like a District Board, such seal is the only means of authenticating the concurrence of the whole body corporate. The present leases do not satisfy these provisions.

8. It is necessary for the validity of contracts and transfers made on behalf of the District Board that they must be executed in the manner laid down in these rules. The consequence of the contravention of these provisions is provided in rule 103, quoted above. It lays down that such a contract shall not be binding on the District Board. It will appear that the provisions of these rules are mandatory and not merely directory. If any contract or transaction entered into by the District Board has not been made in the manner required under these rules, it will not be binding on either party, so that such leases can be enforced neither against the District Board nor by the District Board.

9. These leases are therefore void and did not confer any title upon the defendant. In the case of Akshay Kumar Chand v. The Commissioners of Bogra Municipality 75 Ind Cas 506; (AIR 1923 Cal 675) (A), in which similar provisions of the Bengal Municipal Act, 1884, were involved, a Division Bench of the Calcutta High Court held that the lease was void.

10. Now, it is well-settled by authorities that where a person enters into possession of property by virtue of an instrument which is void and inoperative, his possession is adverse to the true owner from the very beginning, for the simple reason that the transfer conveyed to him no title. The defendant's case which has been accepted by both the Courts below was that he paid rent to the District Board all along.

11. Both the learned Additional Subordinate Judge and the learned Additional District Judge considered that this payment of rent by the defendant made him a licensee. They were erroneous in this view. When his possession was adverse to the true owner from the very beginning the payment of rent will not make the possession lawful. It will only affect the nature of the interest that, the defendant was prescribing by virtue of his adverse possession. Whether or not a person is a licensee is a question of contact between the parties, and when initially the defendant was inducted upon the land as a lessee, his possession will not be regarded as that of a licensee on the instrument of lease being inoperative, payment of rent notwithstanding.

12. When a person enters into possession of land under a void transaction and remains in possession for the full statutory period, the only question for determination is as to the nature of the interest that he has acquired by prescription. To hold that the defendant was a licensee would be to substitute the contract for the parties which is not permissible. Therefore, the only important question that falls for determination is what interest the defendant was prescribing by virtue of adverse possession. One thing is quite plain. He cannot acquire by prescription a right higher than the right which the instrument of lease purported to convey to him. The transaction was admittedly a transaction of lease and therefore when the defendant entered into possession under a void lease, he can acquire only the right of a lessee by prescription.

13. In the case of Kala Devi v. Khelu Rai (AIR 1949 Patna 124) (B), a Division Bench of this Court held, in case of a lease which was invalid under the Santal Parganas Settlement Regulation, that the defendants having held the land for a period of twelve years in open assertion of permanent tenancy rights therein had acquired those rights by prescription and could not be rejected. Therefore, the right which, the defendant will acquire by virtue of adverse possession will be the right of the lessee. The defendant also does not claim a higher right; he only claims an occupancy right by prescription. Then the question is whether he has been in adverse possession for the statutory period. He entered into possession on 1-7-33.

14. The present suit was filed on 7-12-46, that is to say, he has been in possession of the land for upwards of twelve years. Ordinarily, the suit will be governed by the twelve years' limitation, and he will acquire occupancy right by adverse possession. The contention of the respondent is that the present suit is governed by Article 146A of the Limitation Act. This Article provides a period of thirty years for a suit by or on behalf of any local authority for possession of any public street or road or any part thereof from which it has been dispossessed or of which it has discontinued, the possession. The said period is to be commuted from the date of dis-possession or dis-continuance. The plaintiff specifically averred in the plaint that the disputed land formed part of the side cutting lands appertaining to the Baroon Bhaneria Inglish Road. It was no doubt denied on behalf of the defendant. This was, however, a vital question for determination in the suit, but unfortunately the Courts below have not recorded any finding on this point. If the disputed land is a part of any public street or road, then the suit will be governed by the thirty years' period of limitation, as provided in Article 146-A of the Limitation Act. On the findings of the Courts below the defendant has been in possession of the suit land for about thirteen years. If Article 146-A applied, then the defendant has not acquired any interest in the land, and the suit of the plaintiff must be decreed. If, however, the disputed land does not constitute part of a public street or road as envisaged in Article 146-A of the Limitation Act, the suit will no doubt be governed by the General Law of Limitation, as provided in Article 144 of the Limitation Act, which prescribes a period of twelve years only. In that case the defendant must be taken to have acquired occupancy right in the disputed land by prescription for the statutory period of twelve years, and the plaintiff must be unsuited. Since, however, there is no finding on this point, the case must be remitted to the Court below. If the Court finds that the disputed land is part of a public road, the suit will be decreed.

15. If, on the other hand, the Court finds that it is not a part of the public street or road, the suit must be dismissed.

16. The appeal is accordingly allowed, the judgment and decree of the Court below are set aside, and the case is remanded for disposal in accordance with law.

17. Ramaswami, C.J:— I agree.

K.S.B

18. Case remanded.