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Badlu Pathak v. Sibram Singh
Summary of Opinion — Dawson Miller, C.J. (with Adami, J. concurring)
Factual and Procedural Background
This opinion arises from an appeal concerning a sale in execution of a decree obtained by a "7-annas proprietor" (a landlord-share proprietor). It was conceded before the Court that the decree obtained by the 7-annas proprietor was a rent decree and that the plaint in that suit complied with statutory form. The appellants contended that, because no notice was served on a co-sharer landlord as required by section 158B(2) of the Act, the purchaser at the execution sale (the landlord purchaser) took no more than the judgment-debtor's right, title and interest. The appellants also contended that the failure to take proper proceedings to annul a mortgage incumbrance (under the relevant statutory provision) gave priority to that incumbrance over the landlord's rights even if he purchased under a rent decree. A res judicata point was also raised based on earlier proceedings in 1915 and a sale in 1917, with reliance on an earlier case (Mungul Pershad Dichit v. Grija Kant Lahiri) to argue that objections not taken at the sale could not be raised later.
The District Judge found that the co-sharer landlord had waived the right to notice and had recognised the purchase by the 7-annas landlord, accepting from him his share of the rent. The judgment discusses whether the failure to serve notice or to annul the mortgage under section 167 (Bengal Tenancy Act) defeated the landlord's acquisition or his rights against transferees deriving from the original tenant's mortgage. The Court ultimately dismissed the appeal and ordered costs; Adami, J. agreed.
Legal Issues Presented
- Whether, because no notice was served upon the co-sharer landlord as required by section 158B(2), the sale in execution of the rent decree conferred upon the landlord purchaser no more than the right, title and interest of the judgment-debtor (i.e., whether lack of notice reduced the purchaser to an ordinary purchaser under a money decree).
- Whether the failure to annul a mortgage incumbrance (under the provisions of section 167 of the Bengal Tenancy Act) gave priority to that incumbrance over the rights of the landlord, even assuming the landlord purchased under a rent decree.
- Whether the matter was res judicata in view of prior proceedings (notably the 1915 proceedings) and whether objections not taken at the earlier sale could be raised in the present suit (with reliance on Mungul Pershad Dichit v. Grija Kant Lahiri).
Arguments of the Parties
Appellants' Arguments
- Although the decree was conceded to be a rent decree, the appellants argued that because no notice was served upon the co-sharer landlord under section 158B(2), the purchaser at the execution sale (the landlord purchaser) acquired only the judgment-debtor's right, title and interest — equivalent to an ordinary purchaser under a money decree.
- The appellants contended that the failure to take proper proceedings to annul the mortgage incumbrance (under the statutory procedure) gave priority to the incumbrance over the landlord's rights, thereby affecting the landlord purchaser's title or right to possession.
- On res judicata, the appellants argued that the point was not substantially in issue in the previous 1915 proceedings, that the proceedings were not between the same parties or their representatives, and that because no objection was taken at the 1917 sale the objection could not be taken later — relying on the principle stated in Mungul Pershad Dichit v. Grija Kant Lahiri — and that until the sale was set aside the matter could not be questioned.
Other Findings / Respondent Position (as reflected in the opinion)
- It was conceded on behalf of the appellants before the Court that the decree was a rent decree (i.e., both sides accepted that characterization).
- The District Judge found that the co-sharer landlord had waived his right to notice under section 158B(2) and had recognised the purchase by the 7-annas landlord, accepting from him his share of the rent.
- The Court noted the plaintiffs (the mortgagors' transferees) were claiming actual possession as purchasers of the holding and were not seeking remedies such as redemption by payment of the rent charge under section 73 of the Transfer of Property Act or participation in surplus proceeds as second mortgagees — remedies that might have been available in properly framed proceedings but were not the subject of the present suit.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Mungul Pershad Dichit v. Grija Kant Lahiri | Principle that an objection not taken at the sale could not be taken later; relied upon in arguments on res judicata and the finality of sale unless set aside. | The appellants invoked this case to argue objections not taken at the 1917 sale could not now be raised. The Court did not find it necessary to decide the res judicata point finally and therefore did not base its decision solely on this precedent. |
| Rajani Kanta Ghose v. Sheikh Rahman Gazi (also cited as Rajani Kanta Chose v. Sheikh Rahman Gazi) | Held that a co-sharer landlord might waive his right to notice under the provision in question (section 158B), notwithstanding an earlier decision of the Judicial Committee. | The Court regarded Rajani Kanta as rightly decided and applied its principle: a co-sharer may waive the right to notice; here the District Judge found such a waiver and recognition of the purchase. |
| Raghunath Das v. Sundar Das Khetri | Decision of the Judicial Committee referenced as being notwithstanding which Rajani Kanta was decided (i.e., an earlier authoritative view on notice/waiver was noted). | The Court noted Rajani Kanta was decided notwithstanding the Judicial Committee's decision in Raghunath Das; the Court preferred the reasoning in Rajani Kanta for the present circumstances (waiver by co-sharer). |
| Surat Lal Chowdhery v. Lala Murlidhar | Authority for the position that a transferee of a non-transferable occupancy holding cannot force himself upon the landlord as a tenant without the landlord's consent; transferees have a precarious right against the landlord. | The Court relied on this decision to support its conclusion that a mortgagee who purchased in execution cannot claim possession as a raiyat against the landlord's will; the plaintiffs' claim to actual possession was defeated by this principle. |
Court's Reasoning and Analysis
The Court proceeded through the contested points in the following manner:
- Res judicata: The Court observed the appellants' res judicata arguments but stated it was unnecessary to finally determine this question because the appeal would fail on other grounds. The Court also noted it could not finally decide res judicata without more detailed information regarding proceedings under Order XXI, rule 90.
- Notice under section 158B(2): The Court accepted that the decree was a rent decree. It rejected the contention that the failure to serve notice under section 158B(2) necessarily reduced the purchaser to the position of an ordinary purchaser under a money decree. The statutory obligation to serve notice is intended to protect a co-sharer landlord, but the person entitled to such notice may waive it. The District Judge found that the co-sharer had waived the right and had recognised the landlord purchaser, accepting his share of the rent. The Court considered Rajani Kanta Ghose v. Sheikh Rahman Gazi — which held a co-sharer may waive the right to notice — and endorsed that decision.
-
Failure to annul mortgage incumbrance under section 167: Although the statutory procedure for annulling incumbrances under section 167 had not been complied with, the Court found different considerations applied where the landlord himself purchased and the incumbrancer was a mortgagee of a non-transferable occupancy holding. The Court reasoned that:
- Section 65 makes rent a first charge on the holding, taking priority over a mortgage lien.
- A landlord with a decree for rent can sell and purchase the property himself; a co-sharer purchaser acquires the special interest conferred by sub-section (2) of section 22 and may hold the land on paying co-proprietors their shares of rent and may transfer his rights to a third person who becomes a raiyat.
- A mortgagee who obtains a decree on his mortgage and purchases the property cannot, without the landlord's consent, claim possession as a raiyat if the holding is a non-transferable occupancy. The mortgagee cannot step into the shoes of the original tenant and acquire a raiyati interest against the landlord's will.
- Accordingly, the court considered the mortgage incumbrance, though not formally annulled and still subsisting "for what it is worth," to be a barren right against the landlord when enforced by taking possession; it does not entitle the mortgagee/plaintiff to oust the landlord or a tenant claiming under him.
- Reliance on precedent: The Court found its view consistent with Surat Lal Chowdhery v. Lala Murlidhar, which supports the precarious nature of the transferee's right in respect of non-transferable occupancy holdings and the necessity of the landlord's consent for possession as a tenant.
Holding and Implications
Appeal dismissed with costs.
Direct effect on the parties:
- The plaintiffs (transferees/mortgagee purchasers) are not entitled, in the present suit, to take actual possession of the holding as purchasers against the landlord's will.
- The failure to serve notice under section 158B(2) was not fatal where the co-sharer landlord had waived the right to notice and had recognised the purchase, as found by the District Judge.
- The failure to annul the mortgage incumbrance under section 167 did not, in these circumstances, enable the mortgagee purchasers to obtain possession against the landlord because a mortgagee cannot, without the landlord's consent, be treated as a raiyat of a non-transferable holding.
The opinion does not purport to establish a new general rule beyond its application to the facts before the Court; it rests on statutory interpretation and prior authorities cited, and disposes of the appeal by applying those principles to the circumstances described.
Disposition: Appeal dismissed. Adami, J. concurred.
Dawson Miller, C.J:— (after stating the facts set out above, proceeded as follows:)— In argument before us it was no longer denied on behalf of the appellants that the decree obtained by the 7-annas proprietor was a rent decree. In fact the form of the plaint in that suit makes it quite clear that it complied with the provisions of the Statute. But it was contended that the sale in execution thereof conferred upon the landlord purchaser no more than the right, title and interest of the judgment-debtor because no notice was served upon the co-sharer landlord as required by section 158B, sub-section (2) of the Act. It was also contended on behalf of the appellants that the failure to take proper proceedings to annul the incumbrance gave priority to that incumbrance over the rights of the landlord even assuming that he purchased under a rent decree. On the question of res judicata it was contended that the point was not substantially in issue in the previous, proceedings in 1915, that these proceedings were not between the same parties or their representatives and that as no objection was taken at the sale to the plaintiffs in 1917 objection could not be taken now on the principle laid down in the case of Mungul Pershad Dichit v. Grija Kant Lahiri and that until the sale was set aside it could not be questioned.
It is unnecessary, in my opinion, to determine, the question of res judicata as even if we should decide this in favour of the appellants we think they must fail upon other points in the case. Nor indeed could we finally determine this question without having before us more detailed information as to the proceedings under Order XXI, rule 90, than we have at present.
With regard to the second point I have already stated that it is conceded that the decree was a rent decree. Nor do I consider that in the circumstances the failure to serve notice under section 158B involved the consequence that the purchaser at such a sale was in the position of an ordinary purchaser under a money decree. The obligation to serve notice upon the co-sharer landlord is enacted to protect his interest. In such a case the person upon whom it is required to serve notice may, at his option; waive the necessity for such notice. It is found by the District Judge in this case that he did waive the right to such notice and recognised the purchase of the 7-annas landlord, accepting from him his share of the rent. The question was considered in the case of Rajani Kanta Ghose v. Sheikh Rahman Gazi, where it was held that a co-sharer landlord might waive his right to notice under the section in question notwithstanding the decision of the Judicial Committee in Raghunath Das v. Sundar Das Khetri. In my opinion the case of Rajani Kanta Chose v. Sheikh Rahman Gazi was rightly decided.
It remains to consider the third point, namely, the effect of the failure to annul the mortgage incumbrance under the provisions of section 167 of the Bengal Tenancy Act. Admittedly the provisions of that section were not complied with but, although the notice required under the section is framed in language which applies generally to purchasers at sales in execution of rent decrees, and incumbrances can only be annulled in the manner prescribed in the section, different considerations arise in a case like the present where the landlord is himself the purchaser and the incumbrancer is the mortgagee of a nontransferable occupancy holding. The section must be given effect to in the light of the other sections and of the right of the landlord to refuse to recognise a tenant not of his own choosing. Regarded merely as a purchaser he would be barred by the existing incumbrances unless they were annulled. But regarded as a landlord he has the right to refuse to recognise a transferee of the original occupier as his tenant. The plaintiffs are none the less transferees though they acquired under a mortgage lien granted by the original tenants. By section 65 the rent forms a first charge on the holding and takes priority over the mortgage lien. A landlord holding a decree for rent can sell the property and purchase it himself. If he is a co-sharer proprietor, as in this case, he acquires the peculiar interest conferred by sub-section (2) of section 22 and may hold the land on paying to his co-proprietors their share of rent, and may transfer his rights so acquired to a third person who thereupon becomes a raiyat. What then is to happen if the holding is subject to a mortgage granted by the defaulting tenant. Can the mortgagee who has obtained a decree on his mortgage and purchased the property in execution claim possession from the landlord or the raiyat settled on the land by the landlord? Clearly not without the landlord's consent. He has no right to hold the land as a raiyat against the will of the landlord and his incumbrance, although never formally annulled and although still subsisting for what it is worth, is a barren right against the landlord when he seeks to enforce it by taking possession of the property. It is therefore of no consequence that the landlord did not seek to annul the mortgage, for the mortgagee could not step into the shoes of the original tenants and acquire a raiyati interest against the landlord's will. To hold otherwise would be, in effect, to allow the tenant of a nontransferable holding to transfer in a roundabout way to a stranger, without the landlord's consent, by executing a mortgage in favour of the stranger and allowing the holding to be sold in execution of a mortgage decree. Such a sale can give him no right against the landlord without the latter's consent or entitle him to oust the landlord or the tenant claiming under him. It must be remembered that the plaintiffs in this case are claiming actual possession as purchasers of the holding. They are not seeking to redeem the landlord by payment of the rent charge under section 73 of the Transfer of Property Act, or to share in the surplus proceeds of the rent sale as second mortgagees. Such remedies may have been open to them in proceedings properly framed for that purpose. But the present suit is not one of such a nature. Even had proceedings been taken under section 73, I apprehend that when the plaintiffs came to take possession they would still have been in a difficulty unless the landlord consented to accept them as tenants. The view just expressed is in accordance with the decision of this Court in Surat Lal Chowdhery v. Lala Murlidhar. The truth would appear to be that the transferee of a non-transferable occupancy holding, whether he takes by kabala from the original tenant or whether he acquires the property by purchase under a mortgage decree, has a very precarious right, for he cannot force himself upon the landlord as a tenant without the latter's consent.
For these reasons I think that this appeal must be dismissed with costs.
Adami, J.:— I agree.
S.A.K
Appeal dismissed.
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