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Manindra Chandra Nandi v. Durga Sundari Dassya
Summary of the Opinion
Factual and Procedural Background
These four Second Appeals raise three central questions about rent under short-term kabuliats executed by predecessors-in-title of the defendant-respondent in favour of the zemindar now represented by the plaintiff-appellant. Two of the kabuliats (Second Appeals Nos. 2993 and 3005) were for one year and unregistered (executed in 1275 B.S.); the other two (Nos. 3003 and 3004) were for five years and registered (executed in 1280 B.S.).
Prior to the kabuliats of 1275, the zemindar applied under Section 9 of the Bengal Act VI of 1862 for measurement of tenants' lands; measurement and assessment of rent followed, and suits for kabuliats were instituted at the assessed rents. Some suits were decreed ex parte, others after contest. Many tenants, finding it useless to contest, executed kabuliats stating that lands had been measured and rent fixed according to the uniform rate in the pargana and taluk. The kabuliats were short term, and a large portion of the assessed rent was to be kept in suspense (hajat), with the balance payable during the term; the kabuliats also stipulated that no objection would be taken to the payment of the full rent after expiry of the term when hajat would be added to the jama.
After expiry of the kabuliat terms the zemindar did not insist on the full assessed rent but continued to receive rent at the reduced rate for many years. The plaintiff sued to recover rent at the full rate (per the kabuliats) and alternatively claimed rent on the basis of the rate prevalent in the pargana. The defendants denied the kabuliats or contended that, if genuine, they were never acted upon or intended to be acted upon and denied liability to pay the full rate or according to the kists (instalments) claimed.
At first instance the Court found the defendant to be a tenure-holder, held the kabuliats bona fide, found the post-term acceptance of reduced rent to have been an indulgence, and concluded the defendant was bound to pay the full rent according to the instalments in the kabuliats. The District Judge on appeal reversed, concluding that long acceptance of reduced rent created a new implied contract varying the kabuliat. The plaintiff has appealed to this Court, raising the three questions identified above.
Legal Issues Presented
- Whether the defendant-respondent is bound to pay the full rent reserved in the kabuliats executed by her predecessor-in-title in favour of the zemindar now represented by the plaintiff-appellant.
- Whether the defendant is bound to pay rent in 11 instalments (kists) as stipulated in the kabuliats.
- Whether, apart from any stipulation in the kabuliats, the defendant's rent is liable to enhancement up to the customary rate if she is found to be a tenure-holder (i.e., entitlement under Section 7 of the Bengal Tenancy Act if she is an occupancy raiyat/tenure-holder).
Arguments of the Parties
Plaintiff-Appellant's Arguments
- The plaintiff based the primary claim on the express stipulation in the kabuliats that the full rent would be payable after expiry of the term and also alternatively on the ground that the rent claimed was the rate prevalent in the pargana (customary rate).
- The plaintiff argued that the defendant did not set up a case of a subsequent agreement to accept reduced rent and that, as a matter of law, any such subsequent agreement (if alleged) would be unenforceable for want of consideration (relying on Durga Prosad/Prasad Singh authority).
- The plaintiff contended that acceptance of reduced rent by the landlord for a period does not preclude the landlord from later claiming the rent stipulated in the written kabuliat (i.e., indulgence may be revoked).
Defendant-Respondent's Arguments
- The defendant denied execution of the kabuliat, and alternatively pleaded that even if the kabuliat was bona fide it was never acted upon and was not intended to be acted upon.
- The defendant contended she was not liable to pay rent at the full rate or according to the instalments claimed in the kabuliats.
- The respondent (as represented on appeal) argued that the landlord's long acceptance of rent at the reduced rate could be evidence of a new implied contract varying the kabuliat (a position the District Judge accepted).
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Durga Prosad (Prasad) Singh v. Rajendra Narain (Narayan) Bagchi (multiple reports cited) | Authority for the principle that mere acceptance of reduced rent for some time does not necessarily bind the lessor to accept that reduced rent thereafter; and the proposition (in the cited decisions) that an agreement to reduce rent may be unenforceable for want of consideration. | The Court relied on this line of authority to show that acceptance of reduced rent can be an indulgence revocable by the lessor and to underline the point that a purported subsequent agreement to accept reduced rent may be unenforceable for lack of consideration. The Court nevertheless noted that in the present cases the defendant did not affirmatively plead a subsequent agreement, so the District Judge's reliance on an implied subsequent agreement was held to be wrong. |
| Baijnath Prasad Sahu v. Raghunath Rai | Cited among authorities to show that acceptance of reduced rent does not necessarily bind the lessor permanently; similar support for the non-binding character of temporary indulgence. | Used as supporting authority in the discussion that acceptance of lower rent as an indulgence may be put an end to and so does not automatically create an irrevocable new rent obligation. |
| Lakhatullah Sheikh v. Bishambhar Roy | Principle (as pointed out by Jenkins, C.J.) that an agreement inferred from conduct is nonetheless oral in character. | The Court invoked this authority to emphasize that where a registered lease exists, Section 92 (4th proviso) of the Evidence Act bars oral evidence of a variation; since an agreement inferred from conduct is oral, the District Judge could not rely on such evidence to vary registered leases (Second Appeals Nos. 3003 and 3004). |
| Beni Madhab Gorani v. Lalmoti Dassi | Held that evidence that since execution the tenant paid rent at a lower rate than in the kabuliat is admissible to show that the kabuliat was not intended to be acted upon from the first or that there had been a waiver of its strict terms. | The Court agreed with this view and held that payment and acceptance of reduced rent after expiry of the lease is admissible evidence to show either lack of intent to act on the kabuliat or waiver of the stipulation to pay full rent; this principle led the Court to remit the cases for the Court of Appeal to decide whether the stipulation was intended to be acted upon or was waived. |
Court's Reasoning and Analysis
The Court structured its analysis around the three questions identified at the outset and proceeded carefully with regard to the evidentiary consequences of registration and to the factual contentions actually pleaded by the defendant:
- Registration and admissibility of oral evidence: The Court distinguished the registered kabuliats (Second Appeals Nos. 3003 and 3004) from the unregistered ones (Nos. 2993 and 3005). Relying on Section 92 (4th proviso) of the Evidence Act, the Court held that any variation of rent reserved by a registered lease must be by a registered instrument and that oral evidence (including agreements inferred from conduct) is inadmissible to prove such variation for the registered kabuliats. Conversely, for the unregistered kabuliats, Section 92 of the Evidence Act permits oral evidence to prove a subsequent oral agreement.
- On the District Judge's finding of an implied subsequent agreement: The Court held that the District Judge erred in basing his decision on a finding of a subsequent agreement varying the kabuliats. The defendant had denied the kabuliat and alternatively pleaded that it was never intended to be acted upon and never acted upon; she did not positively plead a subsequent agreement. Because no such case was set up by the defendant, the Court concluded it was wrong to dispose of the case on the ground of a subsequent implied agreement.
- Consideration issue left open: The Court noted the plaintiff's contention (relying on Durga Prosad/Prasad Singh) that any subsequent agreement reducing rent would be unenforceable for lack of consideration, and that the respondent argued that a post-expiry agreement could have sufficient consideration. However, because the defendant did not set up a case of subsequent agreement, the Court found it unnecessary to decide the consideration question.
- Admissibility of evidence of long-continued reduced payments to show intent or waiver: The Court accepted the principle from Beni Madhab Gorani that payment and acceptance of reduced rent since execution is admissible to show that the kabuliat was not intended to be acted upon or that there had been a waiver. Because the Court of first instance had found that the stipulation was intended to be operative and there had been no waiver, and because the District Judge had not decided that point, the Court ordered that the question be gone into by the lower Appellate Court.
- Instalments (kists): The Court observed that the question of custom (usage) about paying rent in a number of instalments can arise only where there is no written agreement (citing Section 21 of Act X of 1859). Since there is a written stipulation in the kabuliat regarding instalments, the Court held the District Judge erred in rejecting the plaintiff's claim solely on the ground that no custom supported 11 instalments; instead the Court remitted the issue to determine whether the stipulation was intended to be acted upon given the history of non-enforcement.
- Alternative claim for customary rate and tenure-holder question: The Court noted that the plaintiff alternatively claimed rent as the rate prevalent in the pargana and had expressly prayed for any amount the Court might fix. The first-instance Court had found the defendant to be a tenure-holder. The Court directed the Appellate Court to decide whether the defendant is a tenure-holder and, if so, whether the plaintiff is entitled to enhancement up to the customary rate under Section 7 of the Bengal Tenancy Act, and if not, what the fair and equitable rate is. The Court allowed both parties to adduce further evidence on this alternative ground, but instructed the Appellate Court to address these questions only if it decides the plaintiff is not entitled to full rent on the kabuliat basis.
Holding and Implications
Core Ruling: The decrees of the lower Appellate Court are set aside and the cases are remitted to that Court for reconsideration according to the directions given in this opinion.
Consequences and practical implications:
- The Appellate Court must decide whether, in each case, the stipulation in the kabuliat for payment of the full rent after expiry of the lease was intended to be acted upon or whether there was a waiver of that stipulation (evidence of long-continued payment at a reduced rate is admissible on this issue).
- If the Appellate Court finds the kabuliat stipulation operative, it should consider whether the rent must be paid according to the instalments (11 kists) stipulated; if it finds the stipulation inoperative, it should decide the alternative claim based on the customary rate.
- The Appellate Court must decide whether the defendant is a tenure-holder and, if so, whether the plaintiff is entitled to enhancement up to the customary rate under Section 7 of the Bengal Tenancy Act; if the claimed rate is not customary, the Court must assess the fair and equitable rate. Both parties are entitled to adduce further evidence on these points.
- Costs: Costs are to abide the result.
- The Court reversed the District Judge's approach that the long acceptance of reduced rent alone established a new implied contract varying registered leases, noting statutory restrictions on proving variation of registered instruments by oral evidence.
The opinion does not purport to establish a novel legal principle or to state that a new precedent is being laid down; it remands factual and mixed questions for further determination in the lower Appellate Court in accordance with the statutory and evidentiary principles applied above.
1. Three questions are involved in these four appeals. The first is whether the defendant-respondent is bound to pay the full rent reserved in the kabuliat's executed by her predecessor-in-title in favour of the zemindar now represented by the plaintiff-appellant; secondly, whether the defendant is bound to pay rent by 11 instalments as stipulated in the kabuliats; and thirdly, whether apart from any stipulation in the kabuliats the defendant's rent is liable to enhancement up to the limit of the customary rate if she is found to be a tenure-holder.
2. The kabuliats in Second Appeals Nos. 2993 and 3005 were for the term of one year each and were unregistered, and the kabuliats in Nos. 3003 and 3004 were for five years each and were registered, the first two were executed in the year 1275 B.S. and the last two in the year 1280 B.S.
3. It appears that before the kabuliats of 1275 were executed, the zemindar applied to the Collector for measurement of the lands of the tenants under Section 9 of the Bengal Act VI of 1862. The lands were measured and certain rents were assessed upon the lands found on such measurement. The zemindar then brought suits for kabuliats at the rents so assessed against some of the tenants. Some of the suits were decreed ex parte, and at least one suit appears to have been decreed after contest. The Court of first instance finds that the other tenants finding it useless to fight with the zemindar executed kabuliats in her favour and the kabuliats in the present cases were executed under those circumstances. It was stated in the kabuliats that the lands had been measured and rent assessed according to the uniform rate prevalent from time immemorial in the pargana and the taluk. The kabuliats were only for short terms and it was agreed that a large portion of the rent so assessed was to be kept in suspense (hajat) and the balance payable as the rent for the term. It was stipulated, however, that no objection was to be taken to payment of the full rent after the expiry of the term, when the amount of hajat would be added to the jama.
4. The zemindar after the expiry of the terms of the kabuliats did not realise the full rent but continued to receive rent at the reduced rate all along.
5. The plaintiff based his claim for rent at the full rate on the ground that it was stipulated for in the kabuliat as also upon the ground that it was the rate prevalent in the pargana.
6. The defendants denied the kabuliat and pleaded that even if the kabuliat was bona fide, it was never acted upon or intended to be acted upon, and that they were not liable to pay rent at the full rate or according to the kists as claimed.
7. The Court of first instance held that the defendant was a tenure-holder, that the kabuliats were genuine and bona fide, that the reduced rent was accepted after the expiry of the term as a matter of favour, that the defendant had failed to show that the stipulation in the kabuliats was not intended to be acted upon or had been waived and it was not the defendant's case that there was any subsequent settlement of the rent, and in the result held that the defendant was bound to pay the full rent according to the instalments mentioned in the kabuliats.
8. On appeal the decision was reversed by the District Judge, who was of opinion that the acceptance of rent at the reduced rate for so many years put an end to the agreement to pay rent at the full rate and that the plaintiff, by his conduct in accepting rent at the reduced rate after the expiry of the terms, entered into a new implied contract varying the rent reserved in the kabuliats.
9. The plaintiff has appealed to this Court and has raised the questions set forth above.
10. With regard to the first question, it is to be observed that the mere fact that the landlord accepted rent at a reduced rate than that stipulated for in the kabuliat for some time, does not bind the lessor to accept rent at that rate in future, as the reduced rent might have been accepted as a matter of indulgence which might be put an end to at any time. See Durga Prosad Singh v. Rajendra Narain Bagchi 4 Ind. Cas. 713; 10 C.L.J.670; 37 C. 293, on appeal Durga Prasad Singh v. Rajendra Narayan Bagchi 21 Ind. Cas. 750; 41 C. 493; 18 C.W.N. 66; (1914) M.W.N. 1; 40 I.A. 223; 15 M.L.T. 68; 19 C.L.J. 95; 26 M.L.J. 25; 16 Bom. L.R. 42 (P.C.), Baijnath Prasad Sahu v. Raghunath Rai 14 Ind. Cas. 817; 16 C W.N. 496. As the terms of the kabuliats in these cases expired before the Bengal Tenancy Act, the question whether the agreement contravened the provisions of Section 29 of the Bengal Tenancy Act does not arise in these cases, assuming that the defendant is an occupancy raiyat. It is contended, however, on behalf of the respondent that the acceptance of rent for a very long time may be evidence from which a new contract may be inferred, and the learned District Judge has come to the conclusion, from the acceptance of rent at the reduced rate for a very long time, that there was a new implied contract between the parties, varying the rent reserved by the kabuliats.
11. But under Section 92 (4th proviso) of the Evidence Act, any variation of rent reserved by a registered lease must be made by a registered instrument and oral evidence is inadmissible to prove such variation. The learned District Judge relies upon the conduct of the parties, but an agreement, as pointed out by Jenkins, C.J., in Lakhatullah Sheikh v. Bishambhar Roy 6 Ind. Cas. 577; 12 C.L.J.646, is none the less oral because it is to be inferred from the conduct of the parties. No such evidence is admissible in the two Second Appeals Nos. 3003 and 3004, in which the leases were registered.
12. In the other two cases (Second Appeals Nos. 2993 and 3005) the leases were not registered and under Section 92 of the Evidence Act, oral evidence is admissible to prove a subsequent oral agreement.
13. It is contended, however, on behalf of the appellant that no subsequent agreement to accept rent at the reduced rate was set up by the defendant, nor could it have been set up having regard to the defence taken by her, and that even if any such case had been made, the agreement could not be enforced being without consideration. It is pointed out that the defendant did not allege that the tenants would have given up the lands had not the landlord agreed to the reduction of the rent, which might have formed consideration for the agreement, or any other consideration. Reliance is placed upon the case of Durga Prosad Singh v. Rajendra Narain Bagchi 4 Ind. Cas. 713; 10 C.L.J.670; 37 C. 293, where the learned Judges held that the agreement for reduction of rent was unenforceable as being without consideration, and upon the decision of the Judicial Committee in the same case, where their Lordships agreed with the view taken by this Court on the point. [See Durga Prasad Singh v. Rajendra Narayan Bagchi 21 Ind. Cas. 750; 41 C. 493; 18 C.W.N. 66; (1914) M.W.N. 1; 40 I.A. 223; 15 M.L.T. 68; 19 C.L.J. 95; 26 M.L.J. 25; 16 Bom. L.R. 42 (P.C.).] It was contended, on the other hand, by the learned Pleader for the respondent that as the agreement set up in this case was after the expiry of the terms of the original kabuliats, there was sufficient consideration for the agreement and the present cases were, therefore, distinguishable. It is unnecessary, however, to consider this question, as the defendant never set up any case of subsequent agreement varying the rent reserved in the original kabuliat. The defendant denied the kabuliat and in the alternative pleaded that the kabuliat was never intended to be acted upon, and was never acted upon. We are accordingly of opinion that the learned Judge is wrong in disposing of the case on the ground that there was a subsequent agreement varying the terms of the original kabuliat.
14. The defendant, however, as stated above, pleaded that the stipulation in the kabuliat to pay the full rent was never intended to be acted upon, and was never acted upon. It was open to the defendant to take such a plea. In the case of Beni Madhab Gorani v. Lalmoti Dassi 6 C.W.N. 242 Maclean, C.J., and Macpherson, J., held that evidence that since the execution of the kabuliat the tenant paid rent at a lower rate than that stated in the kabuliat, is admissible to show that the intention of the parties was that the kabuliat from the very first was not intended to be acted upon or that there had been a waiver of the strict terms of the lease, We agree with the above view, and we think that the fact of payment and acceptance of rent at the reduced rate ever since the expiry of the lease may be adduced as evidence to show that the parties never intended that the stipulation to pay the full rent was to be acted upon or in the alternative that there had been a waiver.
15. The Court of first instance held that it was not intended that the stipulation to pay rent at the full rate should be inoperative or that there had been any waiver of the stipulation. The learned District Judge has not come to a finding on the point. It is true the defendant did not distinctly plead waiver in her written statement, but she relied on the fact that the stipulation was never acted upon and the question was gone into by the Court of first instance. We think, therefore, that the case should go back to the lower Appellate Court for a decision upon the said questions: vie., whether the stipulation in the kabuliat as to the payment of the full rent after the expiry of the lease was intended to be acted upon or in the alternative whether there was a waiver of the stipulation after the expiry of that lease.
16. As regards the second point, viz., whether the defendant is bound to pay rent in 11 instalments as stipulated in the kabuliat, we think that the learned District Judge is wrong in deciding the question against the plaintiff on the ground that there is no custom of paying rent in so many kists in the pargana. The question of usage can arise only where there is no written agreement between the parties, under Section 21 of Act X of 1859. It is contended on behalf of the appellant that the fact that the landlord has not claimed rent according to the instalments for a certain period, does not preclude him from ever afterwards claiming rent according to the instalments stipulated for in the kabuliat. Here again we think the question may arise whether haying regard to the fact that rent has never been realised according to the instalments as agreed upon in the kabuliat, the stipulation was intended to be acted upon. We are accordingly of opinion that this question also should be considered by the Court of Appeal below.
17. The last point raises the question whether apart from the kabuliat, the plaintiff is not entitled to the rent claimed on the ground that it is the customary rate. The learned District Judge has not considered the question, on the ground that there was no express prayer in so many distinct terms for assessment of fair and equitable rates of rent and that the Court of first instance dealt only with the plaintiff's claim on the basis of the kabuliat.
18. The plaintiff, however, as pointed out above, based his claim upon the kabuliat, as also upon the ground that the rent claimed was the rate prevalent in the pargana, and there was an express prayer that a decree might be passed for any amount that might be fixed by the Court. The second issue is sufficiently wide to cover the question, but the Court of first instance did not go into the question apparently because the claim of the plaintiff based upon the kabuliat was found in his favour. That Court found that the defendant was a tenure-holder, and it is contended on behalf of the plaintiff that if she is a tenure-holder, her rent may be enhanced up to the customary rate under Section 7 of the Bengal Tenancy Act. Having regard to the fact that this alternative claim was made in the plaint, we think that the parties should not be driven to a fresh suit, and that the Court of Appeal below should decide the question whether the defendant is a tenure-holder, and if so whether the plaintiff is entitled to the rent claimed on the ground that it is the customary rate, and if it is not the customary rate, what is the customary or fair and equitable rate to which the plaintiff is entitled. The Court below will, of course, decide these questions only if it decides that the plaintiff is not entitled to the full rent claimed on the basis of the kabuliat. Both parties will be entitled to adduce further evidence on the point.
19. The result is that the decrees of the lower Appellate Court are set aside, and the cases sent back to that Court for disposal according to the directions given above. Costs to abide the result.
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