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Benarasi Prashad v. Mohiuddin Ahmad
Factual and Procedural Background
The case concerns a revenue-sale of an estate, which the appellant challenged on multiple grounds. The appellant contended that the sale was effected by fraud, that separate revenue accounts existed which should have limited the sale to a part of the estate under the Bengal Land Revenue Sales Act of 1859, and that there should be a decree for Rs. 4,000 against certain defendants based on a mortgage (ijara) agreement. The matter proceeded through lower courts and was appealed to the Commissioner and subsequently to the court delivering this opinion.
Legal Issues Presented
- Whether the revenue-sale was procured by fraud.
- Whether the existence of separate revenue accounts required the sale to be limited to only the defaulting share under section 13 of the Bengal Land Revenue Sales Act of 1859.
- Whether the plaintiff was entitled to a decree for Rs. 4,000 with interest against defendants 9 to 15 based on the terms of the ijara mortgage agreement.
Arguments of the Parties
Appellant's Arguments
- The revenue-sale was fraudulent as the farzidar Mohiuddin and others intentionally defaulted to remove encumbrances by sale for arrears of Government revenue.
- Separate accounts existed for different shares of the estate under tauzi No. 216, and the partition did not affect these separate accounts; therefore, under section 13 of the Bengal Land Revenue Sales Act of 1859, only the defaulting separate account should have been sold.
- The appellant claimed a decree against defendants 9 to 15 for Rs. 4,000 with interest based on the mortgage (ijara) agreement, asserting liability of Birjan Chaudhury’s heirs.
Respondents' Arguments
- The alleged fraud was not substantiated beyond speculative connections and inconclusive witness evidence.
- The argument regarding separate accounts was not raised in pleadings or grounds of appeal, and the law and facts showed that after partition, separate accounts ceased to exist or were freshly opened; thus, the sale of the entire estate was lawful.
- The claim for Rs. 4,000 was challenged on grounds including limitation, impossibility of performance under section 56 of the Contract Act, and the existence of a statutory charge under section 73 of the Transfer of Property Act; also, questions about payment of rent reserved under the ijara were raised but not supported by pleadings or evidence.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Bengal Land Revenue Sales Act of 1859, Section 13 | Only the separate account in default should be sold in revenue-sales. | The court held that the statute’s provision did not apply because the sale was of the entire estate and separate accounts had ceased or been freshly opened after partition; thus, the entire estate sale was valid. |
| Estates Partition Act, Sections 15, 16, 94, 95 | Liability and accounts after partition; separate estates are separately liable for land revenue. | The court found sections 15 and 16 inapplicable as arrears accrued after partition and the sale was of the entire estate. Sections 94 and 95 implied separate accounts cease post-partition unless freshly opened, which aligned with the facts. |
| Land Registration Act, Section 74A | Collector to close separate accounts when facts change. | Supported the court’s view that separate accounts would be closed or reopened as appropriate after partition, undermining the appellant’s argument. |
| Contract Act, Section 56 | Doctrine of impossibility of performance. | The court held that section 56 did not apply because any impossibility arose from the default of the contracting party, not an external cause. |
| Transfer of Property Act, Section 73 | Charge on surplus sale proceeds after sale for arrears of Government revenue. | The court acknowledged the plaintiff’s statutory charge on surplus proceeds but held this did not bar a decree against the successors of Birjan Chaudhury for the mortgage debt. |
Court's Reasoning and Analysis
The court examined each of the appellant’s contentions in detail. On the allegation of fraud, the court found the evidence inconclusive and speculative, particularly noting contradictions in witness testimonies and the credible account given by the purchaser Jung Bahadur. Consequently, no fraud was established.
Regarding the argument on separate accounts, the court carefully reviewed the pleadings and grounds of appeal and found that the point was not properly raised. The court analyzed the relevant statutory provisions and evidence, concluding that after partition, the prior separate accounts were no longer operative and that new accounts had been opened. The sale of the entire estate was therefore lawful under the circumstances.
On the claim for Rs. 4,000 against certain defendants based on the ijara mortgage, the court considered the contractual terms, limitation objections, and statutory provisions. It held that the cause of action arose on dispossession, not the original loan date, and that section 56 of the Contract Act was inapplicable. The plaintiff’s statutory charge on surplus proceeds did not preclude a decree against the successors of Birjan Chaudhury. The court also noted that issues regarding rent payment were not properly pleaded or proven.
Accordingly, the court decreed the claim against defendants 9 and 13 to 15 for Rs. 4,000 with interest, limited to assets of Birjan Chaudhury in their hands, while dismissing the appeal against other defendants.
Holding and Implications
The appeal is decreed in part.
The court held that there was no fraud in the revenue-sale and that the sale of the entire estate for arrears of land revenue was valid despite the appellant’s argument on separate accounts. However, the appellant’s claim for Rs. 4,000 with interest was upheld against certain defendants (9 and 13 to 15) who are successors of Birjan Chaudhury, limited to the assets of Birjan Chaudhury in their possession. The appeal was dismissed against the other defendants. Costs were awarded proportionally.
This decision directly affects the parties by affirming the validity of the revenue-sale and confirming the mortgage claim against specific successors. The opinion does not establish a new legal precedent beyond the application of existing statutory provisions and contract principles to the facts.
Ross, J.:— (After stating the facts, set out above, proceeded as follows):—
Three points were taken by the learned Counsel for the appellant. In the first place, it was contended that the revenue-sale was brought about by fraud; in the second place that in tauzi No. 216 separate accounts had been opened (1) for 9-annas and odd share of Jagarnath Chaudhury; (2) for the 6-annas and odd share of Birjan and Baijnath Chaudhury; and (3) an ijmali account for the remaining share; that the partition did not affect these separate accounts, and in fact at the time of the revenue-sale in 1918 separate accounts were in existence. Consequently under section 13 of the Bengal Land Revenue Sales Act of 1859 only the separate account in default should have been sold and the encumbrance has consequently not been cancelled. And in the third place, that in any case there should be a decree against defendants 9 to 15 for Rs. 4,000.
The case of fraud was not argued very seriously. The allegation is that Mohiuddin was farzidar of Mukhund and Leaqat and that these persons being aware of the encumbered nature of the property intentionally defaulted in order that the encumbrances might be got rid of by the sale for arrears of Government revenue. The only substantial basis for this contention is a connection between Mohiuddin and Leaqat through Latif, the husband of Wilayeti Begam but this in itself is obviously not sufficient.
Reference was also made to the evidence of some witnesses and in particular to the following: In the first place, the evidence of Ram Babu, plaintiff's witness No. 2 was referred to. This witness stated that he attended the sale but did not bid as Maulavi Latif told him that there was an encumbrance on the estate and so he should not purchase it. He also says that Janki Das, Mukhund and Latif paid the money. In his cross-examination he admits that he knew that:
“when an entire village is sold the encumbrance does not form a burden on it and that Anantpur Kukaria was sold as an entire mahal and not a share in it”
and consequently his evidence is self-contradictory and inconclusive. As to the payment being made by Janki and Mukhund, his cross-examination on this point shows that his evidence was without a basis of real knowledge. Iri the second place, reliance was placed on the evidence of Bansi Lal, plaintiff's witness No. 3 a municipal commissioner and honorary magistrate. The evidence of this witness was directed to show that Jung Bahadur was connected with Mukhund. The learned Subordinate Judge has said that the story told by this witness is absurd and I do not think it can be described in any other way. The idea of carefully fixing a meeting between Jung Bahadur and Mangal Chand in order to consider terms of settlement only to be told when the meeting took place that Jung Bahadur had no authority to settle, is not credible. Jung Bahadur in his evidence has given a credible account of the purchase. He says that he and Hafiz and Mohiuddin all intended to bid but having ascertained each other's intentions, they came to terms and purchased jointly. I see no reason to doubt this. The only comment that was made on the evidence of this witness is that he made a mistake about the name of Hafiz. It is possible for a Hindu to mistake a Muhammadan name and there seems to be no ground for suspicion in this. He denies expressly that he was a farzidar for the previous owners.
In my opinion, therefore, no case of fraud in connection with the revenue-sale has been established.
The main argument is the argument relating to separate accounts. The argument is ingenious and although Mr. Hasan Imam earnestly contended that it is to be found in the plaint and in the grounds of appeal to the Commissioner, after a careful persual of these documents, I have been unable to discover it. Paragraph 28 of the plaint says:
“That separate accounts Nos. 1 and 2 had been opened for 15-annai and 4-dams share only, and as a matter of fact the share which had been sold for the arrears of land-revenue was 15-annas and 4-dams only.”
This is the principal reference in the plaint to the separate accounts and the point there taken is entirely different. In the grounds of appeal to the Commissioner it is clearly contemplated, although it is not expressly stated, in the first ground, that the separate accounts had been closed. The point is an entirely new point and the result is that there is very little evidence to go upon.
With regard to the statement of the law that partition does not destroy the separate accounts, there is nothing in the statute to support it and no authority was cited for the proposition. The statute law which was referred to was sections 15 and 16 of the Estates Partition Act. Section 15 has no application because the arrears in the present case accrued after the partition. Section 16 has no application either, for the same reason and also because the present sale is not a sale of a share but the sale of an entire estate. Section 74A of the Land Registration Act contemplates the closing of a separate account by the Collector when the state of things no longer represents existing facts. The argument is that even after the partition the land-revenue for which each of these proprietors was liable remained the same. That may be so but the shares were in fact different. Thus whereas before the partition Mussammat Keola had 3-dams in the whole estate, after partition she had a larger interest in a smaller property. Sections 94 and 95 of the Estates Partition Act would seem to imply that the separate accounts can have no further existence after a partition, because section 94 provides for the separate liability of the separate estate for the amount of land-revenue specified in the notice to be issued under that section and requires the proprietor to enter into a separate engagement for the payment of such land-revenue; and section 95 enacts that from the date of the notice each separate estate shall be separately liable for the amount of land-revenue assessed upon it under the Act. If any further protection is required by way of separate account, it would seem that a separate account must be freshly opened. And as far as the facts can be discovered, that is what happened in the present case.
All that Mr. Hasan Imam had to rely upon was Exhibit 15, Register D, in respect of mauza Rukhai. Now it is admitted that in tauzi No. 216 separate account No. 1 was the account of Jagarnath Chaudhury, separate account No. 2 was the account of Birjan and Baijnath while the remainder was an ijmali account. That remainder included the share of Keola Kuer. After the partition we find a different state of affairs. Exhibit 15 shows that separate account No. 1 was the account of Keola Kuer whereas the ijmali account was the account of the remaining proprietors of the 16-annas. Moreover it appears that this separate account No. 1 of Keola Kuer was opened in case No. 254 of 1917–1918, evidently a fresh proceeding altogether. It is true that this document, Exhibit 15, does not show when that separate account was opened. But there is no reason to suppose that it was opened before the sale for the arrears of the September kist. So far as Exhibit 15 goes, the account might have been opened between the date of the default and the date of the sale; and the ordinary presumption would favour this view, because if there had been a separate account in existence, presumably the Collector would have acted according to the provisions of section 13 of the Sale Law. I find, therefore, no illegality in the sale of the entire estate for the arrears of the September kist of 1917.
The only other point which remains to be considered is the claim against defendants 9 to 15. This claim is based upon the terms of the ijara. That instrument is a mortgage. There is a loan, and a security for the loan contained in the following terms:
“If I fail to make payment of the entire zarpeshgi to the ijaradar by the end of Jeth of 1814, Fasli, then until repayment of the entire zarpeshgi this ijara transaction shall continue to hold good with all the terms laid down above.”
The mortgagor covenants as follows:
“If the whole or portion of the leasehold property be sold at auction by the Civil Court or the Collectorate on account of arrears of land-revenue, road and public works cesses or of any other Government demand, arising out of default on my part or the part of any of my co-sharers, or for any other reason, and if the ijaradar be thrown out of possession of the leasehold property due to any act on the part of me, the executant, then the ijaradar shall be at full liberty to realize the full amount of zarpeshgi together with interest at 1 per cent, per mensem out of the surplus sale proceeds of the leasehold property or from the other nami and benanmi properties, or from the person of me, the executant to which I or my heirs and representatives shall not take any objection whatsoever.”
The learned Counsel for the appellant claims that under this covenant he is entitled to a decree for the principal sum of Rs. 4,000 with interest against the representatives of the mortgagor Birjan Chaudhury. Defendant No. 9 is the son and defendants 13 to 15 are the grandsons of Birjan Chaudhury. Defendants 10 to 12 are the grandsons of Baijnath Chaudhury. The plaint does not allege that Baijnath and Birjan were joint but, on the contrary, specifies their shares in the property and therefore they were presumably separate. The liability would, therefore, be confined to the sons and grandsons of Birjan. Various objections to this liability were urged by the learned Vakil for these respondents. First it was suggested that the cause of action arose in 1907 when the loan became repayable and that the suit was barred by time. But by the terms of the ijara the money became repayable in Jeth 1314 and every subsequent Jeth, and the cause of action under a usufructuary mortgage would arise only on dispossession. Secondly, it was said that after the interest of Birjan Chaudhury had been sold by the Civil Court on a date not specified in the plaint the covenants of the ijara became impossible of performance and, therefore, these respondents are protected by section 56 of the Contract Act. Section 56, however, has no application to such circumstances as these where the impossibility, if any, is due to the default of the contracting party himself. Thirdly, it was said that under section 73 of the Transfer of Property Act, the plaintiff had a charge upon the surplus sale-proceeds after the sale for arrears of Government revenue. This is true and he might have followed the surplus sale proceeds of the property. But he was not bound to do so and the existence of this statutory charge is no bar to his seeking a decree against the successors of Birjan Chaudhury. The decree, however, must be limited, to the assets of Birjan Chaudhury in the hands of these defendants. Finally it was said that there must be an account of the rent of Rs. 75 a year reserved in the ijara and that unless it is proved by the plaintiff that this rent was regularly paid, he is not entitled to the full sum of Rs. 4,000. But this question does not arise on the pleadings. Paragraph 10 of the written statement of the defendants 9 and 10 says:
“The plaintiff has no right to obtain a decree for the ijara money, inasmuch as he has failed to make any allegation about the payment of the rent reserved, and to produce any account for the period of ijara.”
There is no allegation that the rent was not paid. This question was not put in issue and no evidence was given about it and the point is not open to the respondents.
There must, therefore, be a decree against respondents 9 and 13 to 15 for a sum of Rs. 4,000 with interest at 1 per cent, per mensem from the 28th March, 1918, until the date of the decree; the amount of the decree to carry future interest at 6 per cent, per annum and to be realizable only from the assets of Birjan Chaudhury, the mortgagor, which have come to the hands of these defendants. To this extent the appeal is decreed with costs against defendant 9 and 13 to 15 and is dismissed against the other defendants, with costs to defendants 1, 2 and 3. The costs will be in proportion to success.
Das, J.:— I agree.
Appeal decreed in part.
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