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Narayan Prasad Sukul v. Rajkishore Mishra & Others
Opinion Summary — Reuben, J. (with Narayan, J. concurring)
Factual and Procedural Background
The appeal is by Defendant 1 against an order of the Additional District Judge of Manbhum-Singhbhum affirming the Subordinate Judge of Purulia's decision restraining Defendant 1 from executing a decree obtained in Title Suit No. 395 of 1940 (Additional Munsif, Purulia). The dispute concerns the Pratap Natya Mandir cinema and appurtenant premises in Purulia.
The building belonged originally to Akhoy Kumar Sen (pro forma Defendant 3) and was transferred to Shreemati Radharani Dassi (pro forma Defendant 2). After earlier tenants left, Plaintiff 1 (Raj Kishore Misra) entered into possession under an agreement dated 24-3-1940 with Defendant 2. Under that agreement Plaintiff 1 carried out repairs, obtained a certificate of fitness on 12-11-1941 and secured a registered lease dated 3-11-1941 (registered 15-11-1941) from Smt. Radharani Dassi in favour of himself, Plaintiff 2 and Rajendra Prasad Misra (the latter's interest later transferred to Plaintiff 3).
Defendant 1 had earlier obtained a decree for specific performance against Defendant 2 in Title Suit No. 395 of 1940 (a suit originally framed as enforcement of a registered lease dated 5-4-1940 but treated as one for specific performance after Second Appeal No. 66 of 1943). Defendant 1 sought to execute that decree to recover possession. Plaintiffs sued to restrain execution. Defendant 1 contended that the 24-3-1940 agreement was fabricated and antedated and that the plaintiffs' later lease (November 1941) was obtained during the pendency of his suit and so did not affect his decree rights.
The courts below rejected the fabrication and antedating allegations, found that Defendant 1 had notice of the 24-3-1940 agreement and of the plaintiffs' possession, and granted injunctive relief restraining Defendant 1 from execution. This appeal challenges that result.
Legal Issues Presented
- Whether the agreement dated 24-3-1940 between Plaintiff 1 and Defendant 2 constituted a "lease" or "agreement to lease" requiring registration under Section 17(1)(d) of the Registration Act and, if not registered, whether it is admissible in evidence.
- Whether the plaintiffs' subsequently executed registered lease (3-11-1941 / registered 15-11-1941), obtained during the pendency of Defendant 1's suit, is ineffective to affect Defendant 1's rights under his decree by reason of the doctrine of lis pendens (Section 52, Transfer of Property Act).
- Whether, on the facts found (including possession and notice), the plaintiffs were entitled to resist execution of Defendant 1's decree and to a permanent injunction restraining execution against them.
Arguments of the Parties
Appellant (Defendant 1) — Principal Arguments
- The agreement of 24-3-1940 is not a registrable lease and, for want of registration, is inadmissible (or at least cannot prevail against the rights of Defendant 1).
- The registered lease obtained by the plaintiffs (November 1941) was executed during the pendency of Defendant 1's suit and is therefore affected by the rule of lis pendens; it cannot affect Defendant 1's rights under his decree.
- The 24-3-1940 document was fabricated and antedated (i.e., did not exist when he contracted on 5-4-1940), so Defendant 1's decree and rights remain unaffected.
Respondents (Plaintiffs) — Principal Position as Found by the Courts Below
- The 24-3-1940 agreement entitled Plaintiffs to enter, repair and, on compliance, demand a lease; Plaintiffs entered into possession, performed repairs, obtained the certificate of fitness and procured a registered lease on 3-11-1941 (registered 15-11-1941).
- The courts of fact found Plaintiffs were in bona fide possession at the time Defendant 1 instituted his suit and that Defendant 1 had notice of the 24-3-1940 agreement.
- Because Plaintiffs had possession and a pre-existing contractual right (and Defendant 1 had notice), Plaintiffs could resist execution of the decree; their subsequent formal lease did not put them in a worse position.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Hemanta Kumari v. Midnapur Zamindari Co., 47 Cal. 485 | Definition of "agreement to lease": must effect an actual demise, operate as a lease and create a present & immediate interest in the land. | Used to test whether the 24-3-1940 document was a lease requiring registration under S.17(1)(d) of the Registration Act. |
| Panchanan Bose v. Chandi Charan, 37 Cal. 808 | Distinction between agreements creating present interest and agreements to create leases on a future date. | Cited to show that agreements to create a lease at a future date are distinguishable from present leases. |
| Bichardas Damodar v. Ahmedabad Borough Municipality, I.L.R (1941) Bom. 529 | Similar distinction that an agreement to create a lease in future differs from a present lease. | Referred to in the same context as Panchanan Bose to distinguish types of agreements to lease. |
| Ramjoo Mahomed v. Haridas Hullick, 52 Cal. 695 | Illustrative of cases deciding when an agreement amounts to a lease; the criterion is intention of the parties. | Included among authorities showing that words of present demise and intention determine whether an agreement is a lease. |
| Sanjib Chandra Sanyal v. Santosh Kumar Lahiri, 49 Cal. 507 | Support for the proposition that intention and words of present demise are decisive. | Used as an example of decisions where agreement was held to be a lease within cl. (7) of S.2. |
| Poole v. Bentley, (1810) 104 E.R. 66 | Authority referenced among earlier decisions on the nature of leases/agreements to lease. | Mentioned as part of the body of law about present demise and intention behind lease agreements. |
| Purmananddas Jiwandas v. Dharsey Virji, 10 Bom. 101 | Another case in the group where the nature of an agreement to lease was considered. | Cited as precedent supporting the principle applied to the 24-3-1940 document. |
| Harinath v. Promotho Nath, 25 C.W.N 550 | Part of the cited authorities on when an agreement constitutes a lease. | Referred to in support of the interpretive approach to the contract. |
| Nur Muhammad Veerjibhai Veelmahomed v. Natwar Lal, 45 All. 220 | Another authority on agreements to lease and present demise. | Included in the list of illustrative decisions applied to the registration question. |
| Khodaijatul Kubra v. Krishna Pershad, A.I.R (17) 1930 Pat. 530 | Example among cases holding an agreement to be a lease where present demise words were used and intention supported that construction. | Again cited to demonstrate the settled meaning of "agreement to lease" under cl. (7) of S.2. |
| Bachan Singh v. Bijai Singh, 48 All. 221 | Illustration that the doctrine of lis pendens (S.52) has a limited application and does not defeat rights that existed prior to the suit. | Followed to support the proposition that a right existing in a stranger before suit is not defeated merely because title was perfected during the pendency of the suit. |
| Malik Singh v. Shiam Lal, 118 I.C. 143 | Purchaser pendente lite who was a preferential pre-emptor had a prior right and purchase during suit was not affected by S.52. | Applied to show that prior rights enjoyed by a stranger are not necessarily overridden by lis pendens. |
| Sharif Hussain v. Nur Shah, 123 I.C. 124 | Doctrine that lis pendens applies to things coming into existence during the suit, not to rights existing prior to the suit. | Used to illustrate the limited reach of lis pendens against antecedent rights. |
| Bhag v. Ujagar Singh, 96 I.C. 450; affirmed 135 I.C. 48 | Authority supporting that lis pendens does not apply to enforcement of rights which existed prior to the lis. | Cited in the discussion of pre-existing rights and the effect of pendente lite conveyances. |
| Chinnaswami Padayachi v. Dharmalinga Padayachi, 139 I.C. 309 | Rule that lis pendens invalidates subsequent dealings prejudicial to the suit but does not affect previously existing transfers or proceedings to enforce them. | Relied upon to show that previously existing transfers/proceedings to enforce them remain unaffected by lis pendens. |
| Ram Sanchi Lal v. Janki Prasad, 134 I.C. 1 | Opinion (Mukherjee, J.) on lis pendens in mortgage suits limiting the rule to transfers by plaintiff or defendant after the suit. | Quoted for the narrower application of lis pendens to transfers after suit commencement. |
| Suramma v. Surayya, A.I.R (21) 1934 Mad. 585 | Reasoning that lis pendens aims to prevent post-suit alienations which prejudice determination of rights, not to disturb antecedent transfers. | Used to support the court's conclusion that pre-existing legal remedies and transfers remain enforceable. |
| Madhur Sah (Plaintiff) v. Thag Sah (Defendant), 1 Pat. L.J. 455 | Held that a plaintiff who had a prior contract could acquire title during the pendency of a suit and succeed if he proved the prior contract and notice to the purchaser. | Applied by analogy to hold that a prior contract with possession and notice can defeat subsequent pendente lite assertions under S.52. |
Court's Reasoning and Analysis
The court conducted its analysis in two principal strands: (A) whether the 24-3-1940 document was a registrable lease under the Registration Act, and (B) whether the plaintiffs' later lease and possession were displaced by the doctrine of lis pendens under Section 52, Transfer of Property Act.
A. Registration / Nature of the 24-3-1940 document
- The court applied the settled meaning of "agreement to lease" (as discussed in Hemanta Kumari and related authorities): an agreement that effects an actual demise and creates a present and immediate interest is a lease; agreements to create a lease at a future date are distinguishable.
- On close textual analysis of the 24-3-1940 instrument, the court found that it (i) granted the second party the right to enter and make repairs, (ii) contemplated the grant of a lease only upon fulfillment of conditions (making premises fit and obtaining a soundness certificate), and (iii) bound the owner for nine months not to settle the property with others.
- Because the right conferred was essentially to enter and make the premises fit for exhibition and to demand a lease upon compliance with conditions, the court concluded that the document did not create the kind of continuing leasehold "from year to year or for any term exceeding one year or reserving a yearly rent" that Section 17(1)(d) of the Registration Act requires to be registered.
- Even if registration were necessary, the court noted Section 49 of the Registration Act allows such unregistered instruments to be admissible for collateral purposes; accordingly the document was admissible to explain plaintiffs' possession and the nature of that possession when Defendant 1 entered into his agreement on 5-4-1940.
B. Lis pendens (Section 52) and the effect of the plaintiffs' later lease
- The court set out the principle in S.52: the protection is given to rights of parties as they existed when the suit commenced and are embodied in the decree; transfers during pendency cannot affect the rights of parties under the decree, but antecedent rights of strangers are not automatically defeated by pendency.
- Relying on a line of authorities (Bachan Singh; Malik Singh; Sharif Hussain; Bhag v. Ujagar Singh; Chinnaswami Padayachi; Suramma; Madhur Sah), the court emphasised that lis pendens does not destroy antecedent rights that existed prior to the institution of suit; the rule applies primarily to post-suit alienations by parties which would prejudice the suit's determination.
- Applying these principles to the facts found by the courts below: (i) the lease in favour of Defendant 1 dated 5-4-1940 fell within the nine-month period referred to in the 24-3-1940 contract; (ii) the courts of fact found Defendant 1 had notice of the 24-3-1940 contract and knew of plaintiffs' possession; (iii) accordingly the rights of the plaintiffs, which had antecedent origin and were accompanied by possession, continued unaffected by the lease on which Defendant 1 relied.
- The court analysed the contractual division of two periods (the initial nine months and a later period) and concluded that the instrument contemplated rights in both periods; the omission of an express clause for specific performance in the later period did not negate the power to enforce the contract by suit.
- The court also accepted the factual findings that plaintiffs were in bona fide possession on their own account when Defendant 1 instituted his suit (which was within the nine-month period) and that Defendant 1 had notice; this posture meant plaintiffs could have relied on Section 53-A (as the court noted) had they been defendants in that suit, and their later formal lease did not worsen their position or defeat their ability to resist execution.
- On the narrow question before the court — whether Defendant 1 was entitled to execute his decree against the plaintiffs and evict them — the court concluded he was not entitled to do so because plaintiffs' antecedent rights and possession persisted and protected them from execution.
Holding and Implications
Holding: The appeal is dismissed on the merits and Defendant 1 is restrained from executing his decree against the plaintiffs; the injunction granted in favour of the plaintiffs was correctly made permanent by the courts below. The court ordered dismissal of the appeal with costs.
Implications:
- Direct effect: Defendant 1 may not execute his decree to evict the plaintiffs from the Pratap Natya Mandir premises; the plaintiffs retain the protection of the injunction granted by the courts below.
- On legal principles: the decision applies established authorities about (a) the meaning of "agreement to lease" for registration purposes and (b) the limited reach of the doctrine of lis pendens (Section 52) — specifically, that antecedent rights and possession existing before the suit are not necessarily defeated by pendente lite conveyances or perfection of title during the suit.
- The opinion contains no extended discussion claiming to lay down a new precedent; its outcome is the application of existing principles to the facts found. (The court expressly followed and applied earlier authorities.)
Disposition: Appeal dismissed. Narayan, J. concurred.
Reuben, J.:— This is an appeal by deft. 1 against a decision of the Additional Dist. J. of Manbhum-Singhbhum, affirming a decision of the Subordinate Judge of Purulia restraining deft. 1 from executing against the pltfs. respondents a decree obtained by him in Title Suit No. 395 of 1940 in the Court of the Additional Munsif, Purulia.
2. The dispute relates to a building in the town of Purulia known as Pratap Natya Mandir & the premises appertaining thereto. This building is intended for the performance of cinematograph shows & admittedly belonged to Akhoy Kumar Sen (pro forma deft. 3), by whom it was transferred to its present owner Shreemati Radharani Dassi (pro forma deft. 2). The facts as found are that the cinema hall was formerly let to the proprietors of the Shankar Talkies, who held it for some years but relinquished it on foiling to obtain from the Executive Engineer, Hazaribagh Division, a certificate of soundness necessary under the law for the holding of cinematograph shows therein. It was then taken by one Nagendra Nath Dutta, who was unable to make it fit for the purpose & surrendered it in March 1940. Pltf. 1, Raj Kishore Misra, then entered into possession under an agreement entered into on 24-3-1940 with deft. 2, which is in the following terms:
“I, the first party settle (the said theatre house) with you, the second party, on the following terms: That from today you shall, at your own cost, go on doing all works of repairs to the said house & of reconstructing the roof, walls, etc. in accordance with the Govt rules regarding Cinema Houses. After reconstructing the house you shall apply to the Govt authority concerned for a soundness certificate; & then I shall lease out (the house) to you for 10 (Ten) years on a rent of Rs. 75 per month. You shall be in possession of the said Cinema House on monthly rent as a tenant. The rent shall in no case be less than Rs. 75 per month.
That within nine months from today you shall have to make the house fit for Cinema Show after completing all works (of construction). I shall not be competent to settle (the said house) with anybody else within the specified time. Should I do so, the same shall be null & void. On your demand for a pucca deed of lease after making the house fit for Cinema Show (House) withinmine months, should I refuse to execute the deed, you shall be competent, by virtue of this agreement, to get the requisite deed executed with the help of the Court & you shall pay rent at the rate of Rs. 75 per month. You shall be competent to deduct from the rent (payable by you) the amount that you shall spend from to-day in making the Cinema House fit & shall go on paying rent when your dues shall be satisfied.
Should you surrender the house on your being unable to reconstruct the same making it fit for obtaining the Soundness Certificate within nine months, you shall not be entitled to claim any amount of money from me. Should you not surrender the house on the expiry of the aforesaid time, & should you continue to make the house fit for a Cinema Show & spend money (on that account) & after completing the work should demand a pucca deed of lease from me, I shall be bound (to?) execute a deed of lease provided that you shall not be entitled to claim or deduct from the rent (payable by you) the amount that you shall spend from today for making the Cinema House fit for Cinema Show on the ground of compensating my loss due to your taking a longer time than the time specified in the agreement. Should I, the first party, make any breach of agreement within the time specified in the agreement, I shall be liable for the full amount of your loss caused thereby.”
He made the necessary repairs & obtained a certificate of fitness on 12-11-1941 & obtained a registered lease from Smt. Radharani Dassi in favour of himself, pltf. 2 & one Rajendra Prasad Misra, who has since transferred his interest to pltf. 3, by which lease the Pratap Natya Mandir was settled with these persons for a period of ten years on a monthly rental of Rs. 75 with an option of renewing the lease for another ten years on the same terms. The lease was executed on 3-11-1941 & was registered on 15-11-1941.
3. The suit was brought to resist an attempt by deft. 1 to take possession of the cinema hall in execution of a decree for specific performance of an agreement to lease this property obtained by him against deft. 2 in Title Suit No. 395 of 1940 in the Court of the Additional Munsif of Purulia. That suit originated as a suit for the enforcement of a registered lease by deft. 2 in favour of deft. 1 dated 5-4-1940 on the allegation that, in spite of executing the lease in his favour, she did not give him possession. In Second Appeal No. 66 of 1943 disposed of on 6-5-1943, it was pointed out by their Lordships that the document relied on was not a valid lease, having been executed by deft. 2 alone, & the plaint was permitted to be altered into one for specific performance & a decree was given accordingly. The lease has now been executed as directed by the decree & deft. 1 is attempting to recover possession. Deft. 1 denied the existence of the alleged contract of 24-3-1940. According to him, this is an ante-dated document fabricated subsequently to his lease & his rights under his decree are unaffected by the pltfs' lease of 13-11-1941, as it was obtained during the pendency of his suit. The Courts below have rejected his story about the fabrication & antedating of the agreement of 24-3-1940 & have held that when deft. 1 entered into the agreement of 5-4-1940 he had notice of the agreement of 24-4-1940 & knew of the pltfs' possession of the cinema hall. The main argument on behalf of the appellant is on this line: the pltfs. rely upon two documents, (1) the agreement to lease of 24-3-1940 & (2) the lease of 3-11-1941; the first is inadmissible for want of registration, & the second is affected by the rule of lis pendens & does not affect the rights of deft. 1 under his decree. Under Section 17(1)(d) of the Registration Act, lease of immovable property from year to year or for any term exceeding one year or reserving a yearly rent are required to be registered. Under cl. (7) of S. 2, a lease is defined to include “an agreement to lease”. The meaning of this expression is now well settled. It must be an agreement which “effects an actual demise & operates as a lease” & “creates a present & immediate interest in the land” Hemanta Kumari v. Midnapur Zamindari Co., 47 Cal. 485. It must be distinguished from an agreement to create a lease on a future date, Panchanan Bose v. Chandi Charan, 37 Cal. 808 & Bichardas Damodar v. Ahmedabad Borough Municipality, I.L.R (1941) Bom. 529. It is not necessary to examine at length the several decisions which were cited before us. The cases in which the agreement was held to be a lease within the meaning of cl. (7) of S. 2 were all cases in which words of present demise had been used. The criterion in all the cases is the intention of the parties. Ramjoo Mahomed v. Haridas Hullick, 52 Cal. 695, Sanjib Chandra Sanyal v. Santosh Kumar Lahiri, 49 Cal. 507; Poole v. Bentley, (1810) 104 E.R 66, Purmananddas Jiwandas v. Dharsey Virji, 10 Bom. 101; Harinath v. Promotho Nath, 25 C.W.N 550; Nur Muhammad Veerjibhai Veelmahomed v. Natwar Lal, 45 All. 220 and Khodaijatul Kubra v. Krishna Pershad, A.I.R (17) 1930 Pat. 530.
4. Let us examine the document in this light. It commences with the recitation that the first party settles “bando basta karitechhi” the theatre house with the second party & gives the second party the right to enter therein and to make the premises suitable for the purposes of cinema performances, & indicates that on the certificate of soundness being obtained the first party will lease the house to the second party on a certain rent for a certain time. It binds the first party for a period of nine months not to settle the property with anybody else. Apparently, after this period, the second party may make such a settlement but, if she permits the second party to continue in possession & to make the house fit for the purpose she will be bound to execute the deed of lease but will not be liable to pay the amount spent by the second party in making the house fit for use. For the period during which the second party will be in possession for the purpose of making the house fit, no payment by way of rent is provided for. The grant of a lease as such is contingent upon the premises being made fit for the purpose in view. All that the document can be said to entitle the second party to in this respect is a right on complying with the specified conditions to ask for a lease. On behalf of the appellant stress has been laid on the use of the word “settle (bandobasta kariteohhi)” & the subsequent use of the term “surrender”. These terms, it is urged, indicate the creation of a present interest in the property. This interest, however, is at best confined to the period during which it is contemplated that the second party may remain for making the property fit for the purpose to which it was to be put. The right of the second party to remain on the land for this purpose was confined to a period of nine months. Therefore, the agreement even if it is regarded as a lease would not come within the provisions of cl. (d) of sub-s. (1) of S. 17 which requires the registration of leases from year to year or for any term exceeding one year or reserving a yearly rent. For this reason, the document in question did not require registration. Even if it did, under S. 49 of the Act, it is admissible for collateral purposes. It would, therefore, be admissible to explain the nature of the possession of the pltfs. at the time of the agreement of 5-4-1940 on which deft., 1 relies.
5. To deal with the second part of the contention on behalf of the appellant it is necessary to examine the effect of Section 52 of the Transfer of Property Act. This provides that
“during, the pendency…of any suit or proceeding which is not collusive & in which any right to immovable property is directly & specifically in question the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any of the parties thereto under any decree or order which may be made thereunder except &c.”
The protection is given only to the rights of the parties as they existed when the suit was commenced & find embodiment in the decree in the suit. Nothing done by a party during the pendency of the suit can affect the rights of any other party under the decree, but, if a right exists in a stranger from before in relation to the property it will not be affected merely because the title to the property in pursuance of that right was perfected during the pendency of the suit.
6. I am supported by Bachan Singh v. Bijai Singh, 48 All. 221. In that case two pre-emption suits were filed & on the day when the second of these suits was filed one P.S entitled to preempt equally with the pltfs. in the two suits purchased the properties from the defts. vendees. The High Court gave a limited application to the doctrine of lis pendens & held that P.S was entitled to share as a pre-emptor along with the pltfs. If the principle had been applied fully the Court would have had to hold that P.S having acquired the property during the pendency of the suit could not resist the successful pltfs., who should, therefore, have got a decree for pre-emption in respect of the entire property. This decision was followed in Malik Singh v. Shiam Lal, 118 I.C 143, where the purchaser pendente lite was a preferential pre-emptor. Their Lordships pointed out that a person entitled to pre-empt may either come to Court & ask for pre-emption or he may avoid a suit by inducing the vendee to transfer the property directly to him. The pur-chaser pendente lite as a preferential pre-emptor had a right before the institution of the suit to pre-empt in preference to the pltfs. & so his purchase during the pendency of the suit was not affected by S. 52. In Sharif Hussain v. Nur Shah, 123 I.C 124, one Imam Bibi sold certain lands on 13-12-1900. A suit in pre-emption was brought by three persons who got a decree & made the deposit on 28-11-1902 from which date the rights of the vendee vested in them under O. 20, R. 14(1)(b). In the meantime, between the dearee in the pre-emption suit & before the deposit of the money, certain in reversioners of Imam Bibi's husband had instituted a declaratory suit against her without impleading the D.H pre-emptors & obtained a decree in their favour on 13-1-1903. On the death of Imam Bibi, they sued for recovery of possession of the property. Their suit was dismissed by the High Court which observed that the doctrine of lis pendens applies to things coming into existence during the pendency of the suit & not where there is an existing right prior to the suit. Reliance was placed on a decision of a Single Judge reported in Bhag v. Ujagar Singh, 96 I.C 450, which was subsequently affirmed in Letters Patent Appeal in Bhag v. Ujagar Singh, 135 I.C 48. The facts there were similar, the D.H in a pre-emption suit having-perfected his title by the deposit of purchase money during the pendency of the declaratory suit against the original vendee. Their Lordships observed that:
“the right to take over the bargain accrued to the defts. before the commencement of the suit for declaration brought by the pltf. & it has been held that the doctrine of lis pendens does not apply to the enforcement of a right which existed prior to the existence of the lis.”
7. The same principle was applied in Chinnaswami Padayachi v. Dharmalinga Padayachi, 139 I.C 309, to the pendente lite purchase in execution of a mortgage decree. Krishnan Pandalai, J., with whom Waller, J., agreed, observed:
“With the greatest respect, I understand by lis pendens the rule by which by reason of a suit being pending about the rights to some property, subsequent dealings by the parties with that property so as to prejudicially affect the determination of these rights in that suit are invalidated…. In my view the opinion expressed by Mukherjee, J., in Ram Sanchi Lal v. Janki Prasad, 134 I.C 1, on the subject of lis pendens in mortgage suits is correct. It is that the rule only applies to transfers by the pltf. or deft, of their respective interests after the suit including transfers by Court sale in money decrees against either party. But it does not apply to previously existing transfers (including mortgages) or legal proceedings to enforce such transfers by those entitled.”
This decision was followed by Venkatasubba Rao, J., in Suramma v. Surayya, A.I.R (21) 1934 Mad. 585, where his Lordship observed:
“The reason for the doctrine is that but for it, ‘interminable litigation might be the consequence.’ The alienations aimed against by the rule (as the passages extracted above show) are those made during the pendency of the suit & not those which have been effected previously. If ascertain right remains unaffected, the legal remedy to enforce that right must also continue. No suit, therefore, can operate as a lis pendens so as to affect the antecedent transfers which had come into existence prior to it; the transfers being unaffected, it follows that the legal proceedings brought to enforce those transfers are likewise immune from the operation of the rule.”
My reasoning is supported by Madhur Sah…Plaintiff v. Thag Sah…Defendant ., 1 Pat. L.J 455, where the pltf. suing for specific performance of sale by deft., 1 & for a declaration that a sale deed executed by deft., 1 in respect of the same property in favour of deft. 3 was not binding on him, obtained during the pendency of the suit a sale deed from deft. 1 in respect of the disputed property. The High Court held that he was entitled to succeed if he proved that his contract for sale was prior to the conveyance in favour of deft. 2 & that deft. 2 purchased with notice of the contract.
8. The question, therefore, is whether when the lease of 3-11-1941 was executed in their favour the pltfs. had any right in respect of the suit property which should get priority over the lease under which deft., 1 claims. It in important to remember that this lease was executed in favour of deft., 1 on 5-4-1940, within the period of nine months mentioned in the contract on which the pltfs. rely, & also that the finding is that deft. 1 took the lease with notice of the contract of 84-3-1940; hence, the rights of the pltfs. continued unaffected by the lease in favour of deft. 1. It has been suggested that at the time when the lease in favour of the pltfs. was executed no right to ask for a lease in pursuance of the contract existed. The argument is based on an observation which fell from me in the course of the hearing. The contract makes specific arrangements for two periods, the first a period of nine months from the contract, the second such period following the nine months during which the pltfs. might be left in occupation of the premises & permitted to complete the repairs. With reference to the first period it is provided that after the repairs are completed deft 2 shall be bound on demand to execute a lease on a monthly rental of Rs. 75 & in the event of her doing so the other side may sue for specific performance. It also provides that the lessees shall be entitled to de-duct from the rent payable the amount spent by them in making the premises fit for use. Then, coming to the second period, the agreement says that if the premises are surrendered after the period of nine months the grantees will not be entitled to any compensation on account of money spent in repairs. They will, however, be entitled to a lease if they are left in possession & complete the repairs again subject to the proviso that they will not recover anything on account of money spent in repairs. The particulars of the lease to be granted are not mentioned in this portion of the deed & there is no special mention that in the event of failure by deft. 2 to execute the lease the grantees will be entitled to specific performance. On a careful reading of the contract, I am satisfied that this division of the document between the two periods is merely to emphasise the difference in the conditions on which the grantees will be entitled to a lease according as the lease is given in one or other of the two periods. If it is given in the earlier period, the grantees will be entitled to recover the repair expenses. If it is given later, they will not be so entitled. As regards the other terms, the lease will be on the same terms, namely for ten years on a rental of Rs. 75 per month. These terms, it may be noticed, are Specified in the portion of the contract which preceds the portions dealing with the two specific periods. The omission in the portion relating to the later period to provide for a suit for Specific performance has, in my opinion, no significance. The power to enforce a contract does not depend on the existence of such a condition in the contract & it is clear from the contract that deft. 3 bound herself to execute a deed of lease within the second period if the grantees complied with the conditions specified therein.
9. Next, it has been contended that the lease on which the pltfs. rely is not in pursuance of the contract. It is pointed out that whereas the agreement is with pltf. 1 alone the lease was given to the pltf. & two other persons. The case of the pltf. was that pltf. 1 entered into the contract on his own account & on account of the other two persons. This case was not challenged before the Courts of fact & it cannot be challenged in second appeal. It is further pointed out that the contract contains a renewal clause for a further period of ten years & provides for adjustment out of the rents payable of as advance of Rs. 500 said to have been made by the pltfs. to deft. 2. These are merely additional terms & are not such as to justify a finding that the lease is not a transaction in pursuance of the contract.
10. There is another way in which the right of the pltfs. to resist the execution of the decree can be looked at. On the findings of the Courts of fact, it is clear that when deft. 1 instituted his suit the pltfs. were in bona fide possession of the cinema hall on their own account & that deft. 1 was aware of this fact hence, on the position as it then was, the pltfs. were entitled to resist the execution of any decree that might be passed in the suit. The agreement on which deft., 1 succeeded in his suit was executed within the aforementioned period of nine months, & the suit itself was instituted on 30-9-40 within the period of nine months. On the finding, therefore, that deft. 1 had notice of the contract, the pltffs. if they had been impleaded as defts. in that suit, would have been able to interpose the shield of Section 53-A of the Transfer of Property Act. The fact that while standing in this position the pltffs. took the deed of lease from deft. 2 cannot make their possession worse than it was. It was at the worst merely an at tempt to better their position. The plffs. retained their possession of the property & are entitled to rely on it in resisting the execution of the decree obtained by deft. 1.
11. Finally, it is commented that whereas the lease under which the pltffs. claim entitles them to remain on the property for a period of ten years from November 1951, the injunction granted to them is a permanent injunction & is not confined to the period of the lease. The fallacy in the argument in that in the suit we are not concerned with determining the period for which the pltfs. are entitled to occupy the suit property. The only issue is whether deft. 1 is entitled to execute his decree against the pltfs. & to evict them therefrom.
12. The Court having held that he is not, the injunction has rightly been granted in a permanent form.
13. For these reasons, I consider that the appeal has on merits & must be dismissed with costs.
14. Narayan, J.:— I agree.
K.S
15. Appeal dismissed.
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