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  • Section 148-A of the Bengal Tenancy Act.
  • Section 12 of the Bengal Tenancy Act.
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Judges
Acts
  • Section 148-A of the Bengal Tenancy Act.
  • Section 12 of the Bengal Tenancy Act.
Smart Summary

Structured Summary of the Provided Legal Opinion

Factual and Procedural Background

The suit concerns recovery of arrears of rent for the years 1329 to 1332 Fasli. The chain of relevant transactions and proceedings (stated in the opinion) is as follows:

  • 1891: The plaintiff's father settled the patni property with the Tewaris by a lease dated 26 April, 1891.
  • 8 June, 1895: Babu Chet Narain (uncle and predecessor of the defendant Bindeshwari Prasad) took a usufructuary mortgage from the Tewaris of the entire patni interest for Rs. 20,000.
  • 1915: The plaintiff (as owner of an 8 annas share) brought Suit No. 33 of 1915 for recovery of arrears of rent against the Tewaris and obtained a decree under Section 148-A of the Bengal Tenancy Act. Execution of that decree led to sale of the patni interest; Dr. Anadi Nath Mukherji purchased at auction on 7 August, 1916 for Rs. 5,700.
  • 23 January, 1917: The auction-purchaser Dr. Anadi Nath executed a sale-deed in favour of Chet Narain Singh (the defendant's uncle) and Golab Narain Singh (the defendant's father) for Rs. 6,495. Notice of this purchase was given to the plaintiff under Section 12 of the Bengal Tenancy Act.
  • 1920: The plaintiff took Sudbharna from his nephew in respect of his 8 annas share and became the 16 annas landlord, and then instituted the present suit for arrears (1329–1332 Fasli).
  • There were two previous rent suits:
    • Suit No. 34 of 1919: Brought against the defendant and his father (and Dr. Anadi Nath, who was discharged). The Subordinate Judge passed a decree on 3 November, 1821, with a reservation that the defendants would not be personally liable and that the decretal amount would be realised from the rent-claimed property. On appeal the District Judge discharged the Subordinate Judge's order absolving them from personal liability, made the defendant personally liable (father died during pendency), and a subsequent appeal to this Court was dismissed.
    • Suit No. 11 of 1921: Instituted against the present defendant; the Subordinate Judge decreed it on the finding that landlord-tenant relationship existed by operation of law. The appeal to this Court was dismissed; by consent it was arranged that the decree-holder would first realise his decree by selling the tenure and then proceed against the person and other properties of the defendant if necessary.
  • In the present suit, the learned Subordinate Judge (below) decreed claim for the year 1329 (finding the defendant held the patni as usufructuary mortgagee that year) but dismissed claims for subsequent years on the finding that the ancestors were benamidars for the Tewaris and that the patni was given up in 1330 on redemption of the usufructuary mortgage.
  • The plaintiff appealed. On appeal the principal contested issues included whether the 1917 purchase was by the defendant's family on their own account or benami, and whether prior judgments operate as res judicata.

Legal Issues Presented

  1. Was the purchase of the patni property in 1917 made by the defendant's family on their own account, or was it a benami purchase for the Tewaris?
  2. If the purchase was benami, whether the defendant (or his family) is nevertheless liable to pay rent for the disputed years.
  3. Whether prior judgments in rent suits Nos. 34 of 1919 and 11 of 1921 operate as res judicata and establish the defendant's liability.
  4. What is the legal effect of subsequent transactions (simple mortgages executed in 1922 and assignment of arrears in 1923) on the defendant's liability for rent?

Arguments of the Parties

Appellant's (Plaintiff's) Arguments

  • The Court should have held that the 1917 purchase was made by the defendant's family on their own account (i.e., not benami).
  • Even if the purchase was benami, the defendant is liable for the rent.
  • The previous judgments in rent suits Nos. 34 of 1919 and 11 of 1921 operate as res judicata in favour of the plaintiff.

Respondent's (Defendant's) Arguments

  • The defendant's case was that the consideration for the 1917 sale-deed was paid by the Tewaris to the vendor through one Gore Lal (i.e., not paid by Chet Narain's family).
  • Reference was made to simple mortgages executed in 1922 by the Tewaris in favour of the defendant and a deed of assignment of arrears executed on 15 December, 1923, which the respondent relied upon to show that the Tewaris had become owners (or that there was an adjustment of accounts).
  • The defendant stated (in prior proceedings and by affidavit in the High Court) that he was a benamidar (or a benamidar's son), and he sought to use that position in his defence.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Gur Narayan v. Sheo Lal Singh (Privy Council — multiple citations in text) That a benamidar, though having no beneficial interest, represents in fact the real owner and proceedings against him are fully binding on the real owner. The Court applied this principle to state that even if the 1917 purchase were benami, the defendant (as benamidar or representing the real owner) could not escape liability for rent.
Jagannath Prasad Singh v. Abdullah (Privy Council — cited) That a son succeeds to the trusteeship of his father who is a benamidar (i.e., a son may succeed to the trusteeship duties of a father-benamidar). The Court relied on this to support the proposition that the defendant (as son/successor) took up the position of a benamidar and therefore must be held liable as representing the real owner.
Rup Chand Ghose v. Narendra Krishna Ghose (28 Ind Cas. 683) On reference to Section 12 of the Bengal Tenancy Act: a valid transfer of a permanent tenure operates to discharge the transferor from liability to pay rent, and the transferee becomes by operation of law the tenant. The Court cited this authority in discussing the formation of landlord-tenant relationship by operation of law and to explain earlier findings that the defendant had become the tenant of the tenure by operation of law after notice under Section 12.
Bhaishankar v. Morarji (12 Ind. Cas. 535) and Rameshwar Singh v. Hitendra Singh (62 Ind. Cas. 469) That a consent order raises an estoppel as much as a decree passed in invitum (i.e., a consent order can be conclusive/estopping as to the matters agreed). The Court used these authorities to treat the High Court's consent order (that the decree would first be realised by sale of the tenure and then from person/property) as proceeding on the basis of the defendant's liability and as estopping contrary contentions on mode of execution.
Surapati Roy v. Ram Narain Mukerji (73 Ind. Cas. 193; A.I.R. 1923 P.C. 83) Where there is an executed deed of ratification/assignment registered according to law (and covered by Section 12), the transferors of a darpatni interest could not be held liable for rent thereafter. The Court distinguished this case because, in the present case, no deed of re-purchase or registered deed of ratification was taken by the Tewaris from the defendant; thus the exception in Surapati Roy did not apply here.

Court's Reasoning and Analysis

The Court proceeded by first applying the evidentiary maxim that "every apparent transaction must be assumed to be real until the contrary is proved." It considered the testimony of Dr. Anadi Nath Mukherji (the auction-purchaser), who swore that Chet Narain paid him the consideration for the 1917 sale-deed. The defendant's explanation was that the consideration was paid by the Tewaris through one Gore Lal.

On a careful consideration of the entire evidence and circumstances, the Court concluded that the purchase was made by Chet Narain's family on their own account and not in benami for the Tewaris.

The Court then examined the effect of subsequent documents relied upon by the respondent: simple mortgages executed in 1922 by the Tewaris in favour of the defendant and a deed of assignment of arrears dated 15 December, 1923. The Court noted that these mortgages covered multiple properties, that an adjustment of account showed Rs. 18,000 due, and that rokars (account books) used to make up accounts were not produced. The Court found it possible that the purchase money paid by Chet Narain in 1917 was included in the accounts adjusted and secured by the 1922 mortgages. However, the Court emphasized that a simple mortgage bond cannot operate as a deed of transfer. Therefore, even if the mortgages and assignment showed later ownership by the Tewaris, they did not negate the fact that the original purchase of 1917 had been made by Chet Narain's family on their own account; the defendant's liability by virtue of that purchase would attach to him.

Further, the Court considered the legal position if the 1917 purchase had been benami. Relying on Privy Council authority (Gur Narayan v. Sheo Lal Singh), the Court stated that a benamidar represents the beneficial owner and proceedings against him bind the real owner. The defendant had previously stated in earlier rent suits (and in his written statement in this suit) that he was a benamidar; and in prior suits he had been made a defendant and treated as such. The Court also relied on Jagannath Prasad Singh v. Abdullah for the proposition that a son succeeds to the trusteeship of a father who was a benamidar, observing that the defendant had taken up the position of a benamidar and must be held liable as representing the real owner.

The Court also analyzed the significance of previous judicial findings. It recalled that in Rent Suit No. 34 of 1919 the District Judge had held that benamidars represent the beneficial owners and that the plaintiff was entitled to recover a decree against them. In Suit No. 11 of 1921 the Subordinate Judge had held that the defendant is liable for rent and that the relation of landlord and tenant had been established by operation of law (including reference to notice under Section 12). The High Court's dismissal of the appeal in that matter, by consent (with an arrangement as to mode of execution), was treated as an estoppel regarding the defendant's liability.

The Court distinguished Surapati Roy v. Ram Narain Mukerji, where a registered deed of ratification relieved transferors; the Court found no equivalent registered deed of assignment/ratification in the present case. Consequently, the exception recognized in Surapati Roy did not apply to absolve the defendant here.

On the cumulative view of the factual findings (that Chet Narain's family purchased on their own account) and the applicable legal principles (on benami liability, succession of trusteeship, and effect of consent orders), the Court held the Subordinate Judge's judgment unsupportable and allowed the appeal.

Holding and Implications

Holding: The appeal is allowed; the judgment of the learned Subordinate Judge is set aside and the suit is decreed in full with costs throughout. The cross-objection fails and is dismissed.

Implications:

  • Direct effect on the parties: The plaintiff's suit for recovery of arrears (as pleaded in the present proceedings) is decreed in full against the defendant; the defendant remains liable for the decretal amount and costs as ordered by this Court.
  • Legal implications as stated by the Court: The decision rests on factual findings (the 1917 purchase by Chet Narain's family on their own account) and established legal principles (notably the treatment of benamidars as representatives of real owners and the estoppel effect of consent orders). The opinion does not state that it establishes any new legal precedent beyond applying cited authorities to the facts of this case.

Judge: Adami, J. (with a concurrence: "I agree.")

    Deo Lal Jha v. Bindeshwari Narayan Singh And Anr.

    1. This appeal arises out of a suit for recovery of arrears of rent for the years 1329 to 1332 Fasli. The property in arrears was settled by the plaintiff's father with the Tewaris in patni settlement by a lease dated 26th April, 1891. On the 8th June, 1895, Babu Chet Narain, the uncle and predecessor of defendant Bindeshwari Prasad, took usufructuary mortgage from the Tewaris of the entire patni interest for a sum of Rs. 20,000. In 1915, the plaintiff as the owner of 8 annas share brought a suit (No. 33 of 1915) for recovery of arrears of rent against the Tewaris in which he impleaded his nephew (a co sharer-defendant) and obtained a decree under Section 148-A of the Bengal Tenancy Act. In execution of this decree the patni interest was put up to sale and purchased by one Dr. Anadi Nath Mukherji on the 7th August, 1916, for a sum of Rs. 5,700. The auction-purchaser Anadi Nath executed a sale-deed on the 23rd January, 1917, in favour of the defendant's uncle Chet Narain Singh and father Golab Narain Singh for a consideration of Rs.6,495. Notice of the said purchase was given to the plaintiff under Section 12 of the Bengal Tenancy Act.

    2. The plaintiff has taken Sudbharna in 1920, from his nephew in respect of his 8 annas share and has become the 16 annas landlord, and as such he has brought the present suit. There were two previous rent suits instituted by the plaintiff for recovery of arrears of rent for this patni mahal. The first was Suit No. 34 of 1919 brought against the defendant and his father Golab Narain as against also Dr. Anadi Nath Mukherji who was, however, discharged. The learned Subordinate Judge passed a decree on 3rd November, 1821, but made a reservation that the defendants (namely, the present defendant and his father) would not be personally liable and the decretal amount would be realised from the rent-claimed property. In appeal the learned District Judge discharged the order of the Subordinate Judge absolving the defendant and his father from personal liability and merely directing the sale of the patni property in satisfaction of the amount in decree and passed a decree making the defendant liable, his father having died during the pendency of the appeal. The second appeal to this Court against this decision was dismissed. The other Suit No. 11 of 1921 was instituted against the present defendant. It was decreed by the learned Subordinate Judge on the finding that the relationship of landlord and tenant had been established between him and the plaintiff by operation of law and he was liable for the rent of the patni. The appeal to this Court against that decree was dismissed, but it was arranged by consent that the decree-holder would first realise his decree by selling the tenure in question and would proceed against the person and other properties of the defendant in case the value fetched did not satisfy the decretal amount.

    3. The learned Subordinate Judge decreed the claim for the year 1329 on the ground that the defendant held the patni as a usufructuary mortgagee that year, but dismissed the claim for the succeeding years on the finding that his ancestors were benamidars for the Tewaris in the purchase of 1917 from Anadi Nath Mukherji and he gave up possession of the patni mahal in 1330 on the redemption of the usufructuary mortgage.

    4. In appeal it is urged on behalf of the plaintiff that the Court should have held that the purchase was made by the family of the defendant on their own account, and that even if a Benamidar, the defendant is liable for rent. It is also contended that the previous judgments in rent suits Nos. 34 of 1919 and 11 of 1921 operate as res judicata.

    5. Every apparent transaction must be assumed to be real until the contrary is proved. Dr. Anadi Nath Mukherji who had made the auction purchase and conveyed the property has been examined on the side of the plaintiff and he swears that it was Chet Narain (defendant's uncle) who paid him the consideration money for the sale-deed. The defendant's case is that this was paid by the Tewaris to the vendor through one Gore Lal.

    6. [His Lordship referred to the evidence and continued:]

    7. On a careful consideration of the entire evidence and the circumstances of the case there can be no escape from the conclusion that the purchase was made by Chet Narain's family on their own account and not in benami for the Tewaris.

    8. My attention is drawn on behalf of the respondent to the simple mortgages executed in 1922 by the Tewaris in favour of the defendant and the deed of assignment of the arrears of rent by the defendant in their favour executed on 15th December, 1923. The mortgages relate not merely to the disputed property but to some 20 items of properties. Now the evidence is that there was an adjustment of account and a sum of Rs. 18,000 was found due and in order to secure this sum of money the simple mortgage deeds were executed by the Tewaris in favour of the defendant. It is admitted that the accounts were made from rokars but it is significant that these rokars were not produced, so it is quite possible that the purchase money paid by Chet Narain in connection with the sale-deed of 1917 from Anadi Nath Mukherji was also taken into account and included within the sum of Rs. 18,000 for which the mortgages were executed. This will, at best, show that at that time the Tewaris came to be owners of this property. This explains why receipts were produced by the tenants for subsequent period and none for the period prior to the date of the simple mortgage. Be that as it may, these documents are not inconsistent with the fact that the original purchase was made by the family of Chet Narain on their own account. No deed of re-purchase has been taken by the Tewaris from the defendant. A simple mortgage bond cannot operate as a deed of transfer; therefore, the liability of the defendant by virtue of the purchase of 1917 will attach to him.

    9. Even if the purchase of 1917 was a benami transaction on behalf of the Tewaris still the defendant cannot escape liability. A benamidar, though he has no beneficial interest in the property that stands in his name, represents in, fact the real owner and the proceeding against him is fully binding on the real owner. This has been laid down by their Lordships of the Privy Council in Gur Narayan v. Sheo Lal Singh 49 Ind. Cas. 1 : 23 C.W.N. 521 : 17 A.L.J. 66 : 36 M.L.J. 68 : 9 L.W. 335 : 1 U.P.L.R. (P.C.) 1: 46 C. 566 : 12 Bur.L.T. 122 : 46 I.A. 1 (P.C.). It is, however, stated on his behalf that he is himself not a benamidar, but is merely a benamidar's son, and, therefore, this ruling cannot affect him. But it will appear that in the previous Rent Suits Nos. 34 of 1919 and 11 of 1921 he was made a defendant and there he stated that he was a benamidar. What is more, in this particular suit also he states in his written statement that he was a benamidar for the Tewaris (vide para. 9). It will, therefore, appear that the defendant's family as a whole were benamidars. Farther the defendant could, at best, disclaim interest as a benamidar after the death of his father, but this is what he did not do. He treated himself as a benamidar in the written statement in the previous cases and constituted himself thereby as a trustee for the real owner. In this connection reference may be made to the observation of their Lordships of the Privy Council in Jagannath Prasad Singh v. Abdullah 45 Ind. Cas. 770 : 45 C. 909 at p. 918 : 16 A.L.J. 576 : 5 P.L.W. 83 : (1918) M.W.N. 406 : 22 C.W.N. 891 : 8 L.W. 163 : 24 M.L.T. 62 : 28 C.L.J. 192 : 20 Bom. L.R. 851 : 35 C.L.J. 46 : 45 I.A. 97 (P.C.) that a son succeeds to the tusteeship of his father who is a benamidar. In the present case the defendant took up the position of a benamidar and he must be held liable as representing the real owner.

    10. His liability may be examined from another aspect. In Rent Suit No. 34 of 1919 the District Judge made him personally liable for rent. In second appeal it was argued on his behalf that as benamidars of the original patnidars they should not be made liable. In discussing this point Mr. Justice Das (with whom Justice Ross agreed) made the following observations:

    I will assume that defendants Nos. 2 and 3 were the benamidars of the original patnidars. But this does not help the case of the defendants at all. It is now firmely established that benamidars represent the beneficial owners both in transaction and suits and in my opinion the plaintiff is entitled to recover a decree as against defendants Nos. 2 and 3 although it may be that they are the benamidars of the original patnidars.

    11. The effect of this judgment is that the relationship of landlord and tenant was established between the plaintiff and the defendant. In the subsequent Suit No. 11 of 1921, the Subordinate Judge, after discussing certain circumstances which would negative the benami theory but without coming to a positive finding that the purchase was made by the defendant and his ancestors on their own account, refers to the notice under Section 12 of the Bengal Tenancy Act received by the plaintiff relating to the transfer. Then he goes on mentioning that even under the usufructuary mortgage deed held by the defendant he is liable to pay rent to the plaintiff and holds that

    "the defendant is liable for rent of the patni and that relation of landlord and tenant has been established between him and the plaintiff by operation of law."

    12. Then he mentions that the principles of law would not even exonerate a benamidar from such liability. In stating that the defendant has become the tenant of the tenure by operation of law he appears to have used the expression used in the case of Rup Chand Ghose v. Narendra Krishna Ghose 28 Ind Cas. 683 : 19 C.W.N. 112 where it has been held on reference to Section 12 of the Bengal Tenancy Act that the valid transfer of a permanent tenure operates to discharge the transferor from the liability to pay rent and as a consequence the transferee becomes by operation of the law the tenant of the tenure. However that may be, the Court held that there was relationship of landlord and tenant between the parties apart from the usufructuary mortgage. In the High Court also the appeal was dismissed though it was ordered by consent of the decree-holder that the decree would be realised first by selling the tenure and then from the person and property of the defendant, A consent order raises an estoppel as much as a decree passed in invitum: Bhaishankar v. Morarji 12 Ind. Cas. 535 : 36 B. 283 : 13 Bom. L.R. 950 followed in Rameshwar Singh v. Hitendra Singh 62 Ind. Cas. 469 : 2 P.L.T. 628 : 6 P.L.J. 208. The consent order merely affected the mode of execution of the decree but apparently proceeded on the basis that the liability was with the defendant. The relationship between landlord and tenant once established the defendant will continue to be liable for subsequent years unless there is a change in the position by an agreement or by operation of law or in some other valid way. It is argued on behalf of the defendant-respondent that there has been a change in the position because he gave notice by an affidavit in the High Court that he was a benamidar; but this would not have been binding on the Tewaris who, if sued, could have success-fully resisted the plaintiff. The position might have been different if there was a deed of assignment taken by the Tewaris from the defendant and registered according to law as in the case of Surapati Roy v. Ram Narain Mukerji 73 Ind. Cas. 193 : 50 C. 680 : A.I.R. 1923 P.C. 83 : 45 M.L.J. 219 : 18 L.W. 681 : 33 M.L.T. 314 : 39 C.L.J. 26 : 28 C.W.N. 517 : 50 I.A. 155 (P.C.). In this case there was executed a deed of ratification of a certain previous transaction of sale. Their Lordships of the Privy Council considered that Section 12 of the Bengal Tenancy Act covered the case and after that transaction the transferors of the darpatni interest could not be held liable for rent.

    13. In these circumstances I am of opinion that the judgment of the learned Subordinate Judge cannot be supported; and I, therefore, allow the appeal, sat aside the' decree of the Court below and decree this suit in full with costs throughout. The cross-objection fails and is dismissed.

    Adami, J.

    14. I agree.

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    Comments

    Deo Lal Jha v. Bindeshwari Narayan Singh And Anr.
    (Feb 12, 1929)