The Judgment of the Court was as follows:—
This appeal by two of the Defendants is directed against the judgment and decree of the Subordinate Judge, First Court, Sylhet, dated the 14th August, 1937. The suit was instituted by nine Plaintiffs to set aside a revenue sale held on the 23rd January, 1934, in the alternative for a reconveyance of the Plaintiffs' share from Defendants Nos. 6 and 7. The learned Subordinate Judge has granted the first prayer.
Mehal Syed Muhamed Nazir, hisya taluk Md. Batir, bearing Touzi No. 54721/1 of the Sylhet Collectorate, is a permanently settled estate with a total annual revenue of Rs. 3,152-3 as. The total local rate payable at the material time was Rs. 754-11-7 pies. The proprietors of the said mehal had opened separate accounts under the provisions of sec. 65 of the Assam Land and Revenue Regulation (I of 1886). Before September, 1933, thirteen separate accounts had been opened, the first seven in respect of aliquot shares of the mehal and the remaining six in respect of specific lands of the same. With the residuary there were thus fourteen separate accounts. Another separate account (No. 14) was opened in November, 1933. The revenue and local rates were payable in two kists, eleven annas in May and the remaining five annas in September of each year.
Separate accounts Nos. 2 and 6, as also other separate accounts, were in arrear for the May kist, 1933. The remaining separate accounts, except Nos. 2 and 6, cleared up the arrears by payment before the 12th September, 1933, the date fixed for sale for the arrears of May kist, but separate accounts Nos. 2 and 6 were still in default on that date. In the sale statement (Ex. 23, II-I) prepared by the Deputy Commissioner under sec. 72(1) of the Regulation, the arrears stood thus:
No. of separate account.
Arrears of Revenue.
Arrears of Local Rate.
Total
No. 2 … …
Rs. 634-8-2
Rs. 151-9-6
Rs. 786-1-8
No. 6 … …
Rs. 102-14-7
Rs. 24-7-11
Rs. 127-6-6
Total … …
Rs. 737-6-9
Rs. 176-1-5
Rs. 903-8-2
In the course of the sale, the said two separate accounts were reached on the 15th September, 1933. No bids were offered for them with the result that the Deputy Commissioner stopped the sale and directed under sec. 70(2) the sale of the entire estate at the sale date to be fixed for the sale for the arrears of the September kist of 1933. Within ten days of this direction none of the proprietors of the remaining separate accounts came forward to pay up the arrears due for the said separate accounts Nos. 2 and 6 as provided for by sec. 76. The 23rd January, 1934, was later on fixed as the sale date for the arrears of the September kist of 1933. On that day the entire estate, Taluk Muhamed Batir, was put up to sale and was purchased by Defendants Nos. 3 and 4 for Rs. 2,300. On the 17th January, 1935, after the confirmation of the sale (which was on the 8th November, 1934) Defendants Nos. 3 and 4 executed a deed of release in favour of Defendant No. 7, Syed Abdul Jabbar, in which they admitted that the latter had 12 annas share in the estate purchased by them, as he had contributed 75 per cent of the price. (Ex. B, II-33) Defendants Nos. 3 and 4 on the same date sold the remaining four annas share to Defendant No. 6, Rabindralal Das Chowdhury, son of Defendant No. 5 (Ex. H, 11-35). Defendant No. 7 on the next day (18th January, 1935) sold 4 annas out of his 12 annas share to Defendant No. 6 (Ex. I, 11-37). The position then at the date of the suit, which was filed on the 25th September, 1935, was that the entire estate so purchased by Defendants Nos. 3 and 4 had passed to Defendants Nos. 6 and 7, who held it in equal shares. The learned Subordinate Judge has held the sale of the 23rd January, 1934, to be an irregular one. In the sale statement and in the proclamation of sale the arrears of the entire estate for the September kist, 1933, were also shown and lumped together with the arrears of May kist of 1933, due in respect of separate accounts Nos. 2 and 6. This according to him could not be done by the Deputy Commissioner. This is the only irregularity he found. He held that the estate was worth much more than Rs. 2,300, (about Rs. 32,000), and that the irregularity on which he proceeded in decreeing the suit had been mentioned by the Plaintiffs in their memorandum of appeal to the Commissioner filed under the sec. 79. Before us Mr. Bose, appearing for the Plaintiffs Respondents besides supporting the reasons of the Subordinate Judge, has placed three other points, which according to him vitiate the questioned sale. The points accordingly are:—
(i) that the Deputy Commissioner had no jurisdiction to sell the entire estate on the 23rd January, 1934, in any event the sale statement not being in accordance with law, the sale was an irregular one.
(ii) that the acceptance of the earnest money four or five hours after the bid was a material irregularity.
(iii) that the sum of rupees thirty six and rupees nine paid after the 15th September, 1933, and before the advertisement on account of revenue and local rates respectively were not credited. That was also a material irregularity.
He has further contended that even if the sale cannot be reversed, the Plaintiffs are on the facts proved entitled to a conveyance of their respective shares on payment of proportionate prices. We will first deal with this point and the question whether the sale has fetched an adequate price. We may at once say that we agree with learned Subordinate Judge on both these, points.
The Plaintiffs' case is that Defendants Nos. 1, 2 and 8 to 23, for brevity's sake called the Sultanashi Zemindars, were men of influence but some of them, especially Defendant No. 9, were involved in debts and some others had created unprofitable tenures. They intentionally defaulted to pay their share of revenue with a view to purchase in benami at the revenue sale, so that the encumbrances which they had created may be got rid of. On the date of the sale two of them, Defendants Nos. 1 and 2, and their naib, Musrabulla, dissuaded the officer of Plaintiff No. 1 from offering bids by holding out allurements, and later on the agents of the Sultanashi Zemindars after the sale, at which they purchased the property in the benami of Defendants Nos. 3 and 4, induced the Plaintiffs by false promises not to deposit the arrears and the compensation within 30 days of the sale under sec. 78A. This case has been developed in the evidence of Harimohan Dass, naib of Plaintiff No. 1, and Girish Chandra Pal, another officer of Plaintiff No. 1. The case made in the lower Court that there was a concluded contract between the Plaintiffs and the Sultanashi Zemindars by which the latter promised to convey to the former their respective shares for proportionate prices was not pressed before us by the Respondents' Advocate and so need not be considered.
On the case so presented, the first question of importance is whether Defendants Nos. 3 and 4 were benamdars, and if so, whether they were benamdars for the Sultanashi Zemindars. The evidence in support of benami consists of the evidence of Hari Mohan Das, Girish Chandra Pal, Surendra Lal Das, the Nazir and treasurer of the Sub-Divisional Officer, Rai Mohan Das, an officer of Plaintiff No. 2, Satish Chandra Bhattacharya, an officer of Defendant No. 9, Abdul Karim, an officer of Defendant No. 42 and Kamini Kumar Chakravarty, an officer of the Plaintiffs Nos. 3 to 9.
The evidence given by Hari Mohan, Girish Chandra, Rai Mohan and Kamini Kumar is of the same type. They say that at the date of sale Defendants Nos. 1, 2 and their naib Musrabulla told them that they would purchase at a small price in benami and asked the Plaintiffs' men not to compete with them as that would only raise the bid and that they would return the Plaintiffs' share if they were successful. Hari Mohan who had Rs. 5,000 with him and had definite instructions from his master to bid for the property up to Rs. 20,000 agreed to the proposal and offered no bids with the result that the Sultanashi Zemindars purchased the property in the name of Defendant No. 4, their servant. It is hard to believe that Harimohan would break his master's definite instructions, without having obtained something in writing. It is also hard to believe that Harimohan would take this great responsibility without any reference to his master. We cannot accordingly believe this story.
The evidence given by the Nazir is that two of the Sultanashi Zemindars asked him for a loan to pay the earnest money and were with Defendant No. 4 when the earnest money was actually deposited. The last statement by itself is not of much value on the question of benami. The Nazir was besides under the influence of Plaintiff No. 1 and the learned Judge did not consider his evidence to be reliable. The evidence given by Mr. Nosib Ali Mozumdar, Extra, Assistant Commissioner, does not push the case of the Plaintiffs far enough. He cannot say whether the Defendant No. 1, whose tenant he was, approached him for an advance before or after the sale. Satish Chandra Bhattacharya was an officer of the Sultanashi Zemindars. He deposed for the Plaintiffs as he says, with the permission of Defendant No. 9, one of the Sultanashi Zemindars. That shows that some of the Sultanashi Zemindars are siding with the Plaintiff's. His evidence is that Defendant No. 1 paid Rs. 200 towards the earnest money. The evidence of Abdul Karim is that Defendants Nos. 1 and 2 paid the balance of the price on the 15th day of the sale. The evidence, however, establishes the fact that the purchasers at the revenue sale, whoever they be, were short of money. The earnest money was Rs. 575 (one-fourth of Rs. 2,300). They had to run from place to place and the Plaintiffs' case is that the money could not be collected before 8 p.m, that is, five hours' time had been taken to find the money. If an understanding was arrived at with Plaintiffs' officers just before the sale, as alleged by them, we fail to see why the Sultanashi Zemindars had to run from place to place for raising money to meet the deficit, and did not apply to Harimohan who had with him, as is the Plaintiffs' evidence, Rs. 5,000, or why Harimohan did not offer to accommodate them. We cannot also believe the statement that Defendants Nos. 1 and 2 paid any portion of the earnest money or deposited the balance on the 15th day of the sale. It seems to us that Defendants Nos. 3 and 4 were of that class of speculators who usually attend revenue sales. They offered the bid, but were short of money. Any how they managed to deposit the earnest money and for the balance of seventy-five per cent had to find another person. They approached Defendant No. 7, a wealthy Zemindar, who advanced the same on the understanding that he would be given three-fourths share. This is the effect of the oral evidence adduced by the Defendants which evidence is supported by the deed of release Ex. B, II-33. The remaining one-fourth share which Defendants Nos. 3 and 4 still had were disposed of by them at some profit to Defendant 6. There is no evidence to show that Defendant No. 7 only lent his name for the Sultanashi Zemindars. We hold that Defendants Nos. 3, 4 and 7 purchased for their own benefit. None of them were the benawdars of any of the Sultanashi Zemindars. The Plaintiffs are not entitled to any reconveyance from them.
We hold that the price fetched at the revenue sale was not adequate. The reasons given by the learned Judge are, however, not sound. The amount of revenue or local rate, which is levied on an acreage basis, is no index of value. But there is evidence that the income of the estate was considerable. The two annas share, which Plaintilf No. 1 had, gave him a return of Rs. 800 to Rs. 900 a year. Prosanna, the manager of Plaintiff No. 1, mentioned that figure at page 71, 1.10 but no suggestion was made in cross-examination that the profits were not so much. The dealings of Defendant No. 7 also point out that the property was worth much more than Rs. 2,300. He demanded large selamis (Rs. 7,000 to Rs. 8,000) for settlement of fractional parts of the estate (p. 100, 1.20 and p. 134, 1.1 to 20). Tire sale will have to be reversed if material irregularity is established. This leads us to the question of material irregularities. We will now deal with them.
We do not see any substance in the contention that Rs. 36 paid as revenue and Rs. 9 as local rate after the 15th September were not credited by the Deputy Commissioner. The arrears of revenue for the May kist of 1933, for separate account Nos. 2 and 6 was Rs. 737-6-9 and of the local rate, Rs. 176-1-5 as shown in Ex. 23 II-I), the sale statement prepared for the sale fixed for the 12th September, 1933. In the sale statement, Ex. 21 (II-5), prepared for the sale fixed for the 23rd January, 1934, the arrears of revenue and local rates for the May kist of 1933 are shown as Rs. 699-8-3 and Rs. 165-15-1 respectively. The arrears were thus reduced by a little more than Rs. 36 and Rs. 9 respectively. There is no evidence on the side of the Respondents to show that the arrears were less than what has been shown in Ex. 21. We accordingly overrule this point urged by the Respondents.
The next point is with regard to the alleged delay in depositing the earnest money. The evidence leads us to the conclusion that the bidding in respect of this estate, Taluk Muhamed Batir, was over at about 2 P.M, but other sales were taken up thereafter and those sales were finished at 5 P.M The Nazir who was conducting the sale was also the treasurer. It is not likely that he would have or could have accepted the earnest monies before 5 p.m But the fact remains that the earnest money was deposited at about 7 p.m The question is whether this constituted an irregularity for which the sale is to be set aside. Sec. 77 provides that the person declared to be the purchaser shall be required to deposit immediately 25 per cent of his bid and in default of such deposit the property is to be forthwith put up to sale again. This provision was not strictly observed, but there is no evidence that the neglect of this provision has caused the Plaintiffs Respondents substantial injury. There possibly may have been a case of injury if Defendants Nos. 3 and 4 were given time and they ultimately failed to pay in the earnest money and a re-sale was held after the intending bidders had left. The sale cannot, in our judgment, be accordingly annulled in view of the provisions of the first paragraph of sec. 82.
It now remains to consider the two parts of the argument involved in the first point raised by Mr. Bose.
The first branch of the argument as put forward by him is as follows; The Deputy Commissioner could have put up to sale on the 23rd January, 1934, the entire estate for the arrears of separate accounts Nos. 2 and 6 for the May kist of 1933, i.e, the 11 annas kist, as no bids had been offered when those two separate accounts had been put up to sale on the 15th September, 1933, and as the Deputy Commissioner in terms of sec. 70, sub-sec. (2), had directed the sale of the entire estate and no other proprietor had paid the same within the time limited by sec. 76. But the Deputy Commissioner, says lie, had not in fact put up the entire estate to sale for those arrears. He had put up for sale the entire estate for the arrears of the September kist of 1933; i.e, the five annas kist. In support of his contention Mr. Bose has relied upon the heading of the sale statement (Ex. 21, II-5) and of the advertisement in the Gazette, which is an exact copy of the same. The heading runs as follows:—“Instalment on account of which arrear is due—five anna kist of 1339.” Then follow in a tabular form the details of a large number of estates which were in arrears including the estate, Taluk Muhamed Batir. Against Taluk Muhamed Batir, however, two sums are shown as arrears namely Rs. 985-1-0 as current arrears of revenue and Rs. 235-13-8 as current arrears of local rate, that is, arrears for the September kist, 1933 (5 anna kist of 1339) and Rs. 699-8-3 as bakea arrears of revenue and Rs. 165-15-1 as bakea arrears of local rate, that is arrears for the May kist of 1933 (11 annas kist of 1339). The heading therefore was amplified in relation to this estate by the above details contained in the body of the statement. The sale statement and the advertisement, taken as a whole and read fairly, indicate that the sale of this estate was advertised not only for the arrears of the September kist but also for those of the preceding May kist. It is admitted in the plaint that at the time when the Deputy Commissioner made the order on the 15th September, 1933, under sec. 70, sub-sec. (2), he declared that the entire estate would be put up to sale at the sale date to be fixed for the arrears of the 5 anna kist of 1339 (=September kist, 1933) and in the sale statement Ex. 21, and in the notification that was in fact done. No doubt the arrears of the September kist of 1933 were added to the arrears of the May kist, 1933, but that raises a separate question which we deal with later on.
On the opening of a separate account under sec. 65, the liability of all the proprietors still continues to be joint and several. But the separate account in default must first be put up to sale and not the entire estate for such default. If no bids are offered or the bids offered are insufficient to wipe off those arrears, the entire estate is to be put to sale, but after giving an opportunity to the other proprietors to pay up the same within 10 days. As soon as the above-mentioned circumstances combine with the non-payment of the arrears in terms of sec. 76, the Deputy Commissioner is empowered to put up the entire estate to sale and he cannot again be required to advertise for sale the separate accounts separately and to put them up separately for the default of the next kist. In the case of Kumar Narendra Nath Roy v. The Midnapur Zemindary Co. [F.A Nos. 203 and 204 of 1937] the matter has been examined in detail in reference to the provisions of the Bengal Land Revenue Sales Act, XI of 1859. The provisions of the Assam Land and Revenue Regulation are similar. The last-mentioned Regulation, however, is more solicitous for the rights of the Crown, for unlike Act XI of 1859 it continues the joint and several liability of the proprietors even after the opening of separate accounts. It further holds out a greater inducement to the other proprietors to pay up the arrears of a separate account and so purchase it, when for the separate account in arrears either no bids or insufficient bids had been offered, for the proprietor who comes forward and pays up the arrears, acquires the separate account free from encumbrances. We cannot accordingly agree with Mr. Boses's argument that for the arrears of the September kist of 1933, each separate account had to be advertised separately for the September kist, 1933, and had to be put up to sale separately on the 23rd January, 1934, and the whole gamut of procedure as laid down in sec. 70, sub-sec. (2), read with sec. 76, had to be followed again before the entire estate could be put to sale. We accordingly overrule his contention that the Deputy Commissioner had no jurisdiction to sell the entire estate as he did, on the 23rd January, 1934. The default of separate accounts Nos. 2 and 6 gave the Deputy Commissioner power to declare that the entire estate would be put to sale at a future date and the default of the other proprietors in not paying up those arrears within the time limited by sec. 76 gave the Deputy Commissioner jurisdiction to put into effect what he had previously declared. The entire estate could, however, be put up to sale, if and only if, on merging the accounts of the separate accounts into one account, an arrear appeared. The net balance has to be struck up to the kist date for which he intends to put it up for sale. He would have jurisdiction to include the arrears of the next kist, provided that the advertisement be for the sale of that kist also. This has been laid down in Sheik Haji Mutasaddi Mian v. Muhamed Idris . That was a case under Act XI of 1859, but the principles laid down there apply to this case with the same force. The next question is whether lumping the arrears for the May kist of 1933 with the arrears for the September kist of 1933 constitutes an irregularity. In our judgment it does not. This is not contrary to any provision of the Regulation. The Deputy Commissioner is required under sec. 72 to prepare a sale statement. He must include therein the following particulars, namely (1) description of the property, (2) its annual revenue and (3) time and place of the sale. What other particulars are to be included is left to his discretion. He has therefore the discretion to show in the statement the total arrears due up to that time.
Assuming that the inclusion of the arrears of the September kist in the sale statement amounts to an irregularity, the Plaintiffs have to face two points. They did not specify this irregularity in their application made before the Commissioner under sec. 79. We do not think that grounds Nos. C and N mentioned at pages 12 and 13 of Part II or the corresponding grounds in the other application cover the point. Sec. 82 in effect lays down that a Civil Court can annul a sale on the ground of irregularity resulting in substantial injury. The section however is worded in a negative form. Sub-sec. (2) puts further limitations on the powers of the Civil Court. The suit for annulment must be brought within an year of the finality of the questioned sale and (2) the irregularity complained of must be specified in the application made to the Commissioner under sec. 79. We cannot accept Mr. Bose's construction of the second sub-section to the effect that the particular ground must be specified in the application to the Commissioner only in the case where the suit is instituted beyond a year of the finality of the sale but need not be Specified where it is instituted within a year. For this contention he puts emphasis on the word “or” used in that sub-section. That contention would have had some force if a suit to annul a revenue sale could have been instituted beyond a year. Apart from the provision contained in the last portion of that sub-section which in our opinion prescribes the period of limitation, the period of limitation to set aside a revenue sale has been prescribed by the Indian Limitation Act itself. Art. 12, cl. (c) of the first Schedule prescribes one year's limitation from the date of the confirmation of the sale.
The second obstacle in the path of the Plaintiffs is that they have not been able to prove resulting injury. We cannot agree with the Subordinate Judge when he says that if the arrears for the September kist had not been included in the sale statement and in the advertisement, the Plaintiffs could have saved the estate from sale on the 23rd January, 1934, by paying up the arrears for the May kist only. At that date that right was gone. It was gone on the 26th September, 1933. That right could have been exercised only in terms of sec. 76.
We do not decide the question, and keep it open as to whether Defendants Nos. 3, 4, 6 and 7 or any one of them can be considered defaulters within the meaning of the Assam Regulation, as that question is not relevant to this suit.
We accordingly hold that the sale is a valid sale. The appeal is accordingly allowed. The Plaintiffs Respondents must pay Defendants Nos. 6 and 7 their costs of this Court and of the lower Court. We allow one set of costs here and of the Court below to be divided equally between them.
As we have discharged the decree of the lower Court it is not necessary to make a separate order on the cross-objections.
No order is made as to costs on the cross-objections.
P.C