Translate
Text Highlighter

Bookmark

PDF

Share

Report a problem
AMICUS AI
Citation Codes
Equivalent Citations
citation codes
Case Number
Judges
Acts
Are you a practicing lawyer?
Enhance your digital presence and reach by creating a Casemine profile.
Upload pleading to use the new AI search
Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Judges
Acts
Smart Summary

Judgment Summary — Secretary of State for India in Council v. (Ejectment actions relating to Daltonganj building plots)

Factual and Procedural Background

This opinion arises from a series of appeals by the Secretary of State for India in Council concerning ejectment actions over building plots in Daltonganj (Palamau Government Khas Mahal). The plaints included an alternative claim for settlement of a fair rent; that alternative was granted in the various subordinate proceedings. In the specific action under review the plaintiff's claim for ejectment failed below and the Subordinate Judge proceeded to assess or settle a rent by way of enhancement of the rent already paid.

Relevant factual chronology and assertions in the record (as stated in the opinion):

  • The land is part of the khas mahal purchased by Government roughly 120 years earlier as a revenue-paying estate.
  • The land was let to a Badrinath for building purposes (date not established in evidence). The defendants say this was about 60–70 years prior.
  • Area and rents: originally 0.38 acre rented at Re. 0-13-6; under "Mr. Sunder's settlement" (1894–1896) rent was enhanced to Rs. 3 for that holding. Badrinath later sold 0.21 acre (circa 1908), leaving 0.17 acre (the plot now in dispute) with an apportioned rent of Rs. 1-5-0.
  • There was a mortgage and, in 1913, defendants (3–5) purchased the land in execution of a mortgage decree; the landlord did not recognize them. Defendants 3–5 thereafter altered or reconstructed buildings and submitted plans which were sanctioned by the Deputy Commissioner in his municipal capacity.
  • In 1926 Government notified holders of building sites (including this plot) to execute leases at increased rent; defendants did not execute. In September 1928 a notice to quit by 31 March 1929 was issued.
  • The Subordinate Judge found the notice was served personally on defendant 1 but not on defendant 2 nor on defendants 3–5 (a finding not appealed).
  • The Subordinate Judge held (i) the Chota Nagpur Tenancy Act did not apply because the land had been let for building (non-agricultural) purposes, (ii) there was a presumption of permanency / a permanent right because the landlord allowed erection of permanent structures, and (iii) assessed a fair and equitable rent (enhancement) which was contested on appeal.

Legal Issues Presented

  1. Whether a civil court, in a suit for ejectment concerning non-agricultural (building) land, has jurisdiction to settle a fair rent or enhance rent by effectively imposing a bargain between landlord and tenant where no statutory provision (e.g., Chota Nagpur Tenancy Act) applies.
  2. Whether the defendants (or their predecessors) held a permanent, heritable, and transferable tenancy (a tenancy of permanent character) in the disputed plot such that ejectment and enhancement claims are affected.
  3. Whether principles of equitable estoppel, waiver or acquiescence barred the landlord (Government) from claiming ejectment or from denying the defendants' asserted permanent tenancy.
  4. Whether proper notice to quit had been served on the persons entitled to notice (in particular defendants 2 and 3–5), and the effect of any non-service on the plaintiff's right to eject.

Arguments of the Parties

Appellant (Plaintiff / Secretary of State for India in Council) — Principal contentions

  • The Subordinate Judge erred in assessing or settling rent (enhancement) — the appellant contends the rate fixed was insufficient.
  • The tenancy was not of permanent character and the defendants were not entitled to resist ejectment on that ground.
  • Implicitly, the plaintiff relied on its position as landlord and on the formal steps (notification to take fresh leases) to support ejectment or higher rent.

Defendants (including defendants 3–5) — Principal contentions

  • The defendants asserted a permanent, heritable and transferable tenancy in respect of the 0.17 acre plot, originally settled with Badrinath and continuing in their favour.
  • They claimed equitable estoppel, waiver and acquiescence: the Government (landlord) had stood by and allowed substantial building works with knowledge (including municipal approval and, for the execution purchaser, delivery of possession by the Deputy Commissioner as Subordinate Judge), and therefore could not eject.
  • They denied the plaintiff's entitlement to raise the rent as proposed and argued the rent should remain fixed (or be assessed in their favour) on the basis of the asserted permanent tenancy or estoppel.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
6 Pat 446 Proposition that where a suit does not relate to agricultural land governed by relevant tenancy Acts, the Court has no power to impose upon the parties a bargain not of their own making (i.e., no jurisdiction to assess and impose a contractually binding rent in such suits). The Court (Wort, J. and Dhavle, J.) relied on this authority to hold that the Subordinate Judge lacked jurisdiction to settle or impose a rent bargain in a non-agricultural ejectment suit; the assessment of rent below was therefore set aside.
26 IA 58 Equitable estoppel principle: if a landlord permits building with knowledge and does not prevent it, equity may intervene to prevent ejectment (but specific facts are required to show an implied contract changing a tenancy to a perpetual right). The Court treated this decision as establishing the limits of equitable estoppel; it examined whether the facts here met the threshold and concluded they did not (i.e., the defendants failed to discharge the onus required by that authority).
(1885) AWN 100 Source of a statement of principle concerning estoppel (later described as "loose and inadequate" by Lord Watson in the appeal reported in 26 IA 58). The Court noted the appellate criticism of that statement and relied on the more exacting formulation in 26 IA 58 (as explained through Lord Watson's observations) to assess the estoppel argument of defendants.
15 CLJ 220 A Calcutta High Court decision relied upon (by the Subordinate Judge) for the proposition that a permanent right could be inferred in certain circumstances. The appellate Court examined the facts required by that case (four listed factors) and held that two of those factors were not present here; hence the Calcutta decision did not support a finding of permanent tenancy in this matter.
Mohoram Chaprasi's case (cited with authority: 52 Cal 43) Held (by Mookerjee, J.) that a tenancy could be inferred to be permanent where origin unknown and four facts are present (occupation for over 60 years, rent never varied, tenancy treated as heritable, let for residential purposes). The Court (Dhavle, J.) described this decision as most favourable to respondents but noted later authorities criticized it; applied by the Court to explain why the present facts do not permit inferring a permanent tenancy (because two of the four facts were not made out here).
32 CLJ 857 Further development (by the same Judge) of the view that a tenancy could be inferred as permanent on similar factual patterns. Referred to as part of the line of authority which was criticized and which the Court declined to follow as determinative in this case.
Abdul Hakim's case Criticism of the reasoning in Mohoram Chaprasi's case (i.e., casting doubt on inferring permanency from the long occupancy alone). Used by the Court to support the conclusion that long possession without more is insufficient to infer a permanent tenancy in the present facts.
56 Cal 7388 (Rankin, C.J. quoted) Statement that mere long allowance to continue residing without variation in rent is insufficient by itself to found a conclusion of original permanency. The Court relied on this observation to reject the defendants' argument that long occupation without rent variation necessarily indicated permanent tenancy.
34 Cal 9029 (Naba Kumari's case) Authority that non-recognition by a landlord may not affect transferees' rights where receipts show occupiers paying rent on their own account (used in discussing recognition/non-recognition). The Court considered the authority but held it inapplicable because in the present case rent was paid in the name of the recorded tenant and there was no evidence of receipts showing the respondents as occupiers paying rent on their own account.
47 Cal 1 (Lord Dunedin cited) Principle: once an original bargain for a permanent tenancy at fixed rent is settled, question of enhancement is gone unless authorized by statute. The Court invoked this principle to explain that where a permanent tenancy exists, statutory authority would be needed to enhance rent; conversely, absent a permanent tenancy and absent statutory provision, the court could not impose a bargain.
4 Pat 707; 1 HL 129; 21 All 496 Authorities cited for types of estoppel (estoppel by representation; estoppel by acquiescence) from which an implied contract of permanency might be inferred in appropriate circumstances. The Court examined whether facts here amounted to such estoppels and found they did not — neither the estoppel by representation nor the estoppel by acquiescence relied upon in those authorities was established on the facts of this case.

Court's Reasoning and Analysis

The Court's analysis addresses several interrelated issues: jurisdiction to assess/enhance rent in non-agricultural ejectment suits, the character of the tenancy (permanent or yearly), the effect of equitable estoppel, and the sufficiency of notice to quit.

Jurisdiction to settle or enhance rent

Both Wort, J. and Dhavle, J. concluded that a civil Court sitting in an ejectment suit concerning non-agricultural (building) land does not possess jurisdiction to impose a contractual bargain (i.e., to settle a "fair and equitable" rent or enhance rent in the sense of making a new contract for the parties) unless a statute specifically confers such power (the Chota Nagpur Tenancy Act would be an example where statutory rights arise). The Court relied principally on the authority in 6 Pat 446 and the reasoning in 47 Cal 1 (Lord Dunedin) to reach this conclusion. Dhavle, J. expressly set aside the Subordinate Judge's rent assessment as being without jurisdiction.

Whether the tenancy was permanent

The Court carefully examined the factual matrix relied upon to infer permanency. The Subordinate Judge had inferred permanency partly from the landlord's tolerance of permanent structures and from long occupation. The appellate Court analyzed the comparable authorities and identified the conventional catalogue of facts (as set out in Mohoram Chaprasi's line of authority) that might support an inference of permanent tenancy: (1) original tenant and successor in occupation for over 60 years; (2) rent never varied; (3) tenancy treated as heritable; (4) land let for residential purposes. The Court found that two of those factors (continuous non-variation of rent and treatment as heritable) were not established here: the rent had been varied (Mr. Sunder's settlement and later recognition/adjustment on sale) and the landlord treated the holding as liable to further enhancement. Consequently, the Court rejected the inference of a permanent tenancy.

Equitable estoppel, waiver and acquiescence

The defendants' estoppel claim rested on (i) the landlord's knowledge of the erection of permanent buildings and failure to object, (ii) municipal approval of building plans by the Deputy Commissioner, and (iii) delivery of possession by the Deputy Commissioner in execution of a decree. The Court ruled out reliance on acts of the Deputy Commissioner in his judicial or municipal capacities as binding the landlord (i.e., the Deputy Commissioner was not the landlord's agent in those roles). The Court applied the test articulated in the cited precedents (including 26 IA 58 and the appellate observations of Lord Watson) requiring proof that the owner's conduct justified the legal inference that the landlord had contracted to convert the tenancy into a perpetual right. The Court found the defendants did not discharge that onus: there was no allegation or evidence that they acted in honest belief of a permanent right induced by landlord representations, nor were the necessary facts present to create estoppel by representation or acquiescence. Therefore equitable estoppel did not prevent the landlord from denying permanency.

Nature of tenancy and procedural consequence of notice

Having rejected permanency and estoppel, the Court determined the holding to be a tenancy from year to year (i.e., a yearly tenancy governed by common law rules in the absence of relevant statutory provision such as the Transfer of Property Act which was held inapplicable by reason of the Crown Grants Act). For a tenancy from year to year the landlord must give proper notice to quit to terminate. The Subordinate Judge had found notice was not served on defendant 2 nor on defendants 3–5 (a finding not challenged on appeal). Defendants 3–5 had been in possession since 1913 and were transferees from an execution sale; non-recognition by the landlord of their mutation did not render them bare trespassers for the purposes of avoiding notice requirements. In those circumstances the Court concluded that the plaintiff was not entitled to eject these defendants for failure to serve the requisite notices.

Disposition of the assessment of rent

Even though the appellate Court agreed with the appellant that the Subordinate Judge wrongly found a permanent tenancy, the Court held that the assessment of a "fair and equitable" rent was made without jurisdiction in this non-agricultural ejectment suit (per 6 Pat 446), and therefore the assessment was set aside. The final legal effect was to dismiss the plaintiff's suit (i.e., the appeal failed on the ejectment and rent aspects as constrained by procedural defects and lack of jurisdiction to impose a bargain).

Holding and Implications

Core Ruling: The appellate Court dismissed the plaintiff's appeal with respect to ejectment and set aside the Subordinate Judge's assessment of an enhanced/fair rent as being without jurisdiction; the plaintiff was not entitled to eject the defendants because proper notice had not been served on certain persons entitled to notice.

Consequences and immediate effects:

  • The Subordinate Judge's finding that the tenancy was permanent was reversed (the appellate Court found no sufficient grounds to infer a permanent tenancy).
  • The Subordinate Judge's assessment of a fair/enhanced rent was declared without jurisdiction and set aside (the civil Court had no power in a non-agricultural ejectment suit to impose a bargain in the absence of statutory authority).
  • Because notice to quit was not shown to have been served on defendant 2 and on defendants 3–5 (a factual finding not appealed), the plaintiff was not entitled to eject them; accordingly the plaintiff's suit was dismissed in its practical effect.
  • No costs were awarded against the defendants (the appellate judges indicated no order as to costs or dismissing the appeal without costs in substance).

The opinion does not purport to create a novel general precedent; it applies established authorities to the facts and emphasizes the limits on a civil Court's power to impose contractual bargains in non-agricultural ejectment proceedings.

Order: As recorded in the judgment, the appeal is disposed of in accordance with the reasons set out above.

    Secretary Of State v. Babu Rajendra Prasad

    Wort, J.:— This is one of a number of appeals by the Secretary of State for India in Council arising out of actions in ejectment and relating to building plots in the town of Daltonganj. There was an alternative claim in each case for settlement of a fair rent. This alternative claim has been granted in each case. In this action the claim for ejectment failed. The settlement of fair rent raises a question of jurisdiction and arises in these circumstances. In this case, the claim for ejectment failed and the Judge proceeded to settle a rent by way of enhancement of the rent already being paid. In other cases the claim for ejectment succeeded and the Judge proceeded to fix a rent on payment of which the defendants could remain in possession. In those cases where the action for ejectment; succeeded, a fair rent was settled by the Court at the instance of the plaintiff, as it was stated that there was no intention to eject the defendants, and although it was desired to have the decision of the Court on the merits of that question, on payment of a fair rent the tenants would be allowed to remain in possession. There was no suggestion that the Court was exercising the jurisdiction to settle a fair and equitable rent or to enhance the rent under the Chota Nagpur Tenancy Act. Indeed, so far as enhancement was concerned, the Court proceeded to allow the plaintiff's claim for considerations which would not apply to the exercise of jurisdiction under that Act. Therefore in neither case could it be suggested that the Court was exercising a statutory jurisdiction in that regard. The relationship of landlord and tenant which existed is in the first instance a matter of contract, and, by assessing rent to be paid by the tenant, the Court purports to make a bargain between the parties—a jurisdiction which it does not possess. It is rather difficult to imagine how the Judge thought that he had jurisdiction in this matter as the question is an elementary one. If authority for the proposition that no such jurisdiction exists were needed it is to be found in 6 Pat 446,1 where Sir Dawson Miller appears to have stated:

    As this was not a suit relating to agricultural land governed by the Bengal Tenancy Act, the Court had no power to impose upon the parties a bargain not of their own making.

    2. That matter is clear. I leave for consideration the question which arises in this connection in one other of the appeals which will be dealt with on the facts of that particular case. But so far as the question was one of making a bargain for the parties and not the interpretation of a contract or lease entered into by those parties, I hold that the claim for enhancement of rent or settlement of fair and equitable rent must fail in every case. I should have stated that part of this appeal relates to the enhancement of rent towards which the appeal is directed. The appellant contends that the rate of enhancement is not sufficient, but this question for the reasons which I have stated does not arise. The land, the subject matter of this dispute, is a part of the khas mahal. It formed part of a revenue-paying estate which was purchased by Government in default of payment of revenue about 120 years ago. There is no doubt that during the course of years the town of Daltonganj, which was in all probability in its origin a village, developed into a town of some importance and became the headquarters of the Division. This and some other facts were proved in the case for the purpose of establishing a matter with which we now have no concern, that is, the increasing value of the land. The land in dispute was let to one Badrinath for building purposes at a date of which there is no evidence. The defendants contend it was about 60 or 70 years ago; it measured acre and was held at a rent of 13 annas 6 pies. In 1894, there commenced a settlement which was known as Mr. Sunder's settlement which was completed in 1896. The rent was enhanced under that settlement to Rs. 3. Subsequently Badrinath sold .21 acre leaving in hand .17, the area now in dispute. Government agreed to this transfer which was in 1908 and apportioned the rent for the balance at Rs. 1-5-0. The land appears to have been the subject matter of a mortgage by Badrinath and in 1913 in execution of a mortgage decree defendants 3 to 5 purchased the land but were not recognized by the landlord. It was contended therefore that in any event they were trespassers and liable to ejectment. That point, however, I will deal with, in a moment.

    3. In 1926 there was a notification by Government calling upon the holders of building sites in Daltonganj including the holder of the plot in dispute to execute leases at an increased rent. This the defendants failed to do, and in September 1928 a notice calling upon the defendants to quit on 31st March 1929 was issued. The learned Judge in the Court below has held that the notice was served personally on defendant 1 but was not served on defendant 2 nor was it served on defendants 3 to 5. Against this finding there is no appeal. Defendants 3 to 5 after their purchase in 1913 proceeded either to demolish or alter the buildings then on the land and submitted plans for alteration to the Deputy Commissioner as Chairman of the District Board, which were sanctioned by him. The learned Judge in the Court below has held that the defendants had a permanent right in the land by reason of the fact that the defendants were allowed to build and to erect permanent structures to the know, ledge of the landlord. He has held, however, that no occupancy rights existed in the defendants as the Chota Nagpur Tenancy Act did not apply. As regards the latter question, the facts are as follows:

    It is admitted by both parties that the land was let out for building purposes. It was not pleaded in the written statement that rights existed under the Chota Nagpur Tenancy Act and the question appears to have been raised for the first time in the argument before the Judge in the Court below. The learned Judge has stated that it was not the contention of the parties that Badrinath was an agriculturist, nor is there any evidence to lead one to that conclusion. In those circumstances the Judge was undoubtedly right in coming to the conclusion that as the land was let out for building purposes no occupancy rights in the defendants existed. This is supported by the decision to which I have already referred in 6 Pat 446. The Government pleader advances the argument that the learned Judge was wrong in coming to the conclusion that the defendants' right was a permanent one. The learned Judge, relying upon the decision of the Calcutta High Court in 15 CLJ 220,2 has come to the conclusion that the right was a permanent one. It appears that the Judge has based his conclusion on the presumption of a lost grant. By that I understand him to mean that the facts and circumstances of the case led to the inference that it was agreed by the landlord, when letting the land to Badrinath that he should have a permanent lease. It is impossible to lay down any definite rule from what facts such inference could be drawn but the case upon which the learned Judge relies does not support his conclusion. In that case the facts that were established were first, the original tenant and his successor had been in occupation of the land for over 60 years; secondly, that the rent had never been varied; thirdly, that the Tenancy had been treated by the landlord as heritable; and fourthly, that the land had been let out for residential purposes. Even assuming that those four facts were established, the inference would not be irresistible, but in the case before us two facts, namely, the second and the third, have not been made out. Bent, as we have seen in this case, has been varied from time to time. It was enhanced during Mr. Sunder's settlement, and the landlord in this case has treated it as liable to further enhancement by calling upon the defendants to execute leases at a higher rent. Had all the facts been established to which Mookerji, J. in that case referred, I do not agree that necessarily the inference of a permanent lease should be drawn, but in this case two at least of these four items are wanting as I have said.

    4. The defendants have relied very strongly on what they have described as equitable estoppel. The facts upon which they rely to establish this proposition is that the landlord, the Government, stood by and allowed the person in possession to erect permanent buildings. They rely also upon the fact that the Deputy Commissioner, who was the Subordinate Judge, gave delivery of possession to defendants 3 to 5 on execution of a mortgage decree. They also rely upon the fact that the Deputy Commissioner, in the capacity of Chairman of the Municipality, approved of the building plans of defendants 3 to 5. In my opinion we must rule out the last two facts. The Deputy Commissioner as Subordinate Judge was not acting as the agent for the landlord even supposing that his action would have otherwise estopped the landlord nor was the Deputy Commissioner acting as the agent of the landlord in his capacity as the Chairman of the Municipality. No assistance therefore can be got from those two facts by the defendants. We are therefore left with the fact that the tenant was allowed to erect buildings on the land to the knowledge of the landlord. I think the case in 26 IA 58,3 is conclusive of this matter. In that case the landlord let out to five tenants six bighas of land for the term of the current settlement for the construction thereon of a saltpetre factory. There was an assignment by the landlords of their interests as also the interests of the tenants, and the tenants there relied upon the fact that after the completion of the saltpetre factory, for which the land was taken, the landlord saw that from time to time the defendants and their ancestors were erecting houses and spending large sums of money thereon without any objection or prohibition, which it was alleged induced the defendants and their ancestors to build. The Subordinate Judge in that case held that the saltpetre factory only went on for a few years and that since that date the land had been used for another purpose, namely, the building of shops, which the landlord did nothing to prohibit, and he applied the rule which he stated thus:

    If a man permits another to build upon the land, and with the knowledge that the building is being erected, stands by and does not prevent the other from doing so, then, no doubt, equity comes in, and by the rules of equity, which in this respect are the same as the rules of law, he cannot eject that other person.

    5. The decision of the Subordinate Judge was confirmed by the Court of appeal, the High Court. Lord Watson describes the statement of the principle upon which the Subordinate Judge relied, a principle to be found in (1885) AWN 100,4 as “loose and inadequate” and makes this observation:

    In order to raise the equitable estoppel which was enforced against the appellants by both the appellate Courts below, it was incumbent upon the respondents to show that the conduct of the owner, whether consisting in abstinence from interfering or in active intervention, was sufficient to justify the legal inference that they had by plain implication contracted that the right of Tenancy under which the lessees originally obtained possession of the land should be changed into a perpetual right of occupation.

    6. And Lord Waston held that:

    Their Lordships have had no difficulty in coming to the conclusion that the respondents have failed to discharge themselves of that onus.

    7. Not only in this case, as I have stated, is there an absence of the facts from which an inference of a permanent Tenancy could be drawn, but there is equally an absence of evidence to establish “by plain implication” that the landlord had contracted that the right of Tenancy under which the lessees originally obtained possession should be changed into a perpetual right of occupation. In my judgment, the defendants' claim to a permanent Tenancy fails. But there is another matter to be considered before this appeal can be disposed of. If the defendants' rights were not permanent, what were they? In the first instance I have to note that the parties here contracted as landlord and tenant and it is not suggested that these lettings were by way of settlement of revenue and Mr. Sinha on behalf of Government admits that the lettings were governed by the ordinary law of landlord and tenant. There was a suggestion on the part of the plaintiff that these lands were let out for periods of fifteen and thirty years; but there is no evidence to establish the fact that was the oral agreement between the parties. The case is not governed by the Chota Nagpur Tenancy Act as I have said, nor is it governed by the Transfer of Property Act. The Crown Grants Act (15 of 1895) provides:

    Nothing in the Transfer of Property Act, 1882, contained shall apply or be deemed ever to have applied to any grant or transfer of land or of any interest therein heretofore made or hereafter to be made by or on behalf of Her Majesty the Queen-Empress, her heirs or successors or on behalf of the Secretary of State for India in Council, to, or in favour of, any person whomsoever.

    8. And it has been held in the decision to which I have already made two references that this Act applies to grants such as the one with which we are dealing. The matter therefore must be dealt with apart from the Transfer of Property Act. The defendants' predecessor went into possession without any agreement as to the renewal of the Tenancy as there is a complete absence of evidence as to any contract with regard to that particular. By Common law, applied as the rule of justice, equity and good conscience, in the absence of any provision in Indian law in this Regard, the tenants were tenants from year to year. We have noticed that the finding is that the notice was not served on defendant 2 and was not served on defendants 3 to 5. Defendants 3 to 5 were transferees, there being nothing in the law of India to prevent the original grantee from assigning his interest in the land, and defendants 3 to 5 were therefore entitled to notice before ejectment. The Judge in the Court below has noticed that the Government did not agree with the mutation of the defendants' names after they had purchased and has held that such mutation was not obligatory in this instance—a decision regarding the correctness of which there can be no doubt. The original grantee being entitled to assign as I have held, it was necessary to establish that notice had been served on defendants 3 to 5 which the landlord in this case has failed to do. In those circumstances, although the defendants had not a permanent interest the plaintiff is not entitled to eject them. Whilst therefore setting aside the decision of the Subordinate Judge as to the enhancement of rent, I would dismiss the plaintiff's appeal but without costs.

    Dhavle, J.:— This appeal arises out of a suit for ejectment from a non-agricultural holding in Daltonganj in the Palamau Government Khas Mahal. The case of the plaintiff, who is the appellant before us, was that the land “was in the lease of defendants 1 and 2 for residential purposes without a registered instrument” and carried an annual rent of Rs. 1-5-0 payable by the official year ending 31st March. In 1924 the plaintiff had a survey made of the town and fixed certain new rates for building sites in view of the growth of trade and rise in local values. A new lease with the relevant rate was offered to defendants 1 and 2, the recorded lessees of the plaintiff, and also to defendants 3 to 5 who had acquired the holding from defendants 1 and 2 and were in occupation of it without the permission of the Deputy Commissioner. As none of the defendants accepted the offer, the Deputy Commissioner gave them notice to quit, and on their failure to comply, this suit was filed for their ejectment, with a prayer in the alternative that a rent of Rs. 10-3-0 per annum in accordance with the rate of Rs. 60 per acre fixed by the plaintiff in 1924 be declared payable by defendants 3 to 5 “for a period of 30 years or till the next Settlement”. Defendants 1 and 2 denied the plaintiff's case and said that defendants 3 to 5 had been unnecessarily impleaded, being trespassers; bub they did not contest the suit. Defendants 3 to 5 pleaded a title to the holding in virtue of an auction-purchase by their father in execution of a decree against Badrinath, the grandfather of defendants 1 and 2. They denied the plaintiff's right to raise the rent, and said that the lease was permanent, heritable and transferable, with a fixed rent. They also said that the plaintiff's claim to eject the defendants was “barred by the principle of estoppel, waiver and acquiescence,” since he had stood by and raised no objection to the construction of a substantial house on the site by their father at considerable expense with the permission of the Deputy Commissioner as Chairman of the Daltonganj Municipality.

    9. The learned Subordinate Judge found that in the circumstances of the case there was a presumption of permanency as regards the tenancy in favour of the contesting defendants, and that the plaintiff was also barred from claiming ejectment by the principle of equitable estoppel. An issue had been framed as to the validity and legality of the notice that the plaintiff claimed to have served on the defendants; and though defendants 3 to 5, the contesting respondents before us, do not appear to have objected in their written statement that they had not been properly served with the notice, the learned Subordinate Judge found that no notice had been served upon them. He also found that no notice had been served upon defendant 2. But he negatived the claim of these defendants to hold at a fixed rent, without any enhancement, and found that a rent of Rs. 4-1-0, at the rate of Rs. 25 per acre, was fair and equitable. In the result he decreed the suit in part, disallowing the plaintiff's claim for ejectment and fixing the rent at Rs. 4-4-0 a year. It may be noticed incidentally that he did not deal with that part of the plaintiff's prayer in which the Court was asked to fix the rent, not without any term but “for a period of 30 years or till the next Settlement”. The plaintiff appeals and contends that this was not a case where a permanent Tenancy could be properly inferred, and that there was no equitable estoppel to prevent the plaintiff from obtaining ejectment.

    10. In paras. 9 and 13 of their written statement, defendants 3 to 5 (the contesting respondents) pleaded that the land in suit had been originally settled with their predecessor-in-title, Badrinath, over 60 years ago, as a permanent lessee, for building purposes, at a fixed rent of Rs. 1-5-0 per annum. No evidence was however given to show when the original settlement with Badrinath was made. The earliest indication on record is afforded by Ex. 6, the khatian of Sunder's Survey and Settlement, 1894–1895 to 1896–1997, which shows that previously Badrinath had houses on three plots with an area of 0.38 acre, on a rent of Re. 0-13-6, and that this rent was raised to Rs. 3 in the proceedings of that Settlement. Ex. 2, the jamabandi register, shows that Mr. Sunder's settlement was to run for 15 years from 1st October 1896, and that during the currency of this Settlement Badrinath sold two of his plots, with an area of 0.21 acre, to one Dhanukdhari Lal who was recognized by the Khas Mahal as a new tenant on an enhanced rent of Rs. 3-2-0, Badrinath continuing as a tenant in respect of the balanoe of 0.17 acre on a rent of Rs. 1-5-0. It appears from the evidence of plaintiff's first witness, the mutation clerk of the Khas Mahal, that the transfer of 0.21 acre to Dhanukdhari Lal was effected in 1908. The learned Subordinate Judge has clearly misread Ex. 2 in taking it to mean that Badri's rent was Rs. 3-2-0 for 0.38 acre. He has arrived at his finding of permanency of the tenancy of 0.17 acre on the authority of such cases as 52 Cal 43,5 56 Cal 2756 and 15 CLJ 220. Out of these cases the one that is most in the respondents' favour is Mohoram Chaprasi's case where Mookerjee, J. held that a tenancy could be inferred to have been in its inception permanent, where its origin was unknown, the original tenant and his successor had been in occupation for over 60 years on a rent which was never varied, the Tenancy was treated by the landlord as heritable and the land was let out for residential purposes. This view, which was carried still further by the same learned Judge in 32 CLJ 857 was criticized in Abdul Hakim's case and can hardly be accepted as sound having regard to the observations of Rankin, C.J in 56 Cal 7388:

    The mere circumstance that the tenant and his; family have for a very long time been allowed to continue residing in the same place without any variation in the rate of rent is a circumstance which by itself is an insufficient foundation for holding that the tenant's right was permanent in its origin.

    11. In the present case, moreover, the original rent of Re. 0-13-6 for 0.38 acre was changed to Rs. 3 in Sunder's Settlement, and the transfer of 0.21 acre to Dhanukdhari was only recognized by the plaintiff on an enhanced rent of Rs. 3-2-0 instead of Rs. 1-11-0. That the proportionate rent for 0.17 acre, out of the total of Rs. 3 fixed by Mr. Sunder for 0.38 acre, has remained at Rs. 1-5-0 since that settlement until the revision of 1924 plainly affords no reason whatsoever for presuming that the Tenancy was permanent in character. For, that rent was fixed for a term of 15 years, though the fresh settlement or revision of rents in the case of old tenants or their heirs happened to be delayed till 1924. In arriving at the presumption of permanency, the learned Subordinate Judge also refers to the fact that the house built by the father of the contesting defendants on the land in suit is of a substantial character; but it must not be overlooked that this house was built not by the recorded tenant, Badrinath, but by an execution purchaser to whom as defendant 3 himself states, recognition was refused by the landlord. Not having been built “long before any controversy arises”, this house can lead to no inference that the Tenancy was permanent. As to the non-recognition by the landlord, the learned Subordinate Judge cites 34 Cal 9029 as an authority for the proposition that the non-recognition does not affect the rights of the respondents in any way. That may be, but the ruling in Naba Kwmari's case again, has no application to the facts of this case, for it is not pretended that there are here (as there were in that case) any receipts for rent in which the respondents are shown as the occupiers paying the rent of the holding on their own account. Rent was obviously paid, since the execution sale, in the name of the recorded tenant, and recognition by the landlord as one of the considerations leading to an inference of permanency or equitable estoppel is wholly wanting. The tenancy of 0.17 acre on a rent of Rs. 1-5-0 is, strictly speaking, only established from 1908, but it has been urged by the learned advocate for the respondents that the arrangements of 1908 should not be regarded as creating a new tenancy since Badrinath had been holding this plot of 0.17 acre from before. Even if this be conceded, the Tenancy of 0.17 acre on a rent of Rs. 1-5-0 per annum would only go back to Sunder's Settlement, and we know not only that before this Settlement the rent was much less, but also that the rent fixed by Mr. Sunder was only intended to remain in force for 15 years (see Ex. 2 and para. 351 of Sunder's Final Report). The learned advocate has laid stress on the recognition of Dhanukdhari, who purchased 0.21 acre from Badrinath, by the landlord; but as I have already pointed out, this recognition was accompanied by an enhancement of the rent from Rs. 1-11-0 to Rs. 3-2-0. Mr. Sunder's settlement fixing a new rent of Rs. 3 for the whole holding for 15 years goes for by itself to negative the claim of a permanent tenancy. Even if it were possible to regard it as a solitary instance of unwilling submission by a permanent tenant entitled to hold on a fixed rent (as suggested by the learned advocate) the enhancement on the transfer of Dhanukdhari goes further to negative a permanent tenancy as an inference from a transfer as of right among other considerations. The learned advocate has also referred to the house built by Badrinath, a kutoha two-storied khapra house (as P.W 1 describes it)—which was re-constructed by the execution purchaser. This house is not referred to by the Subordinate Judge, nor did the respondents rely on it in their written statement as they did in para. 15 on their father's house. Badri's house can be of but little assistance to the respondents in showing that his tenancy with its unknown origin was permanent. For as Rankin, C.J said in Kamal Kumari's case:

    The fact that a tenancy was for residential par-poses in no way involves of itself that the tenant's right to the land was to be permanent as the land could be used for katcha structures to be erected by the tenant, not structures such, as the tenant could not without imprudence raise upon the land in the absence of a permanent right nor such as give notice to the landlord that the tenant claims a permanent right.

    12. It was also suggested on behalf of the respondents that an inference arises against the plaintiff's case of a tenancy from year to year from the fact that their house was constructed or reconstructed with the permission of the Deputy Commissioner. But this permission was only obtained under the Municipal Act, and it is obvious that as Chairman of the Daltonganj Municipality the Deputy Commissioner could not have refused permission merely because it was within his knowledge as an agent of the landlord that the land was not held on a permanent tenancy. Still less does it admit (assist?) the respondents that their father had obtained delivery of possession from the Court of the Deputy Commissioner Sub-Judge. The learned advocate for the respondents also relied on the circumstance that in Sunder's khatian Badrinath was shown as “dakbilkar (occupancy)”. The khatian, however, does not carry any specific presumption of correctness such as attaches to Record-of-Rights under the Bengal or the Chota Nagpur Tenancy Act, and the entry regarding Badrinath's status is inconsistent with the respondent's case that the land had been originally settled with Badrinath for building purposes. An occupancy right in Chota Nagpur is given by law to certain tenants of agricultural land and entitles them to cultivate the land or to occupy it in proper ways, without any limit of time, subject to the payment of a rent which is liable to enhancement from time to time on certain specified grounds but not by contract. Such a right can only arise in agricultural land, and it is nobody's case that Badrinath was ever a raiyat of the land in suit in the sense in which suits for the ejectment of raiyats or tenants of agricultural land have continued from 1859 onwards to be excepted from the cognizance of the civil Courts in the Chota Nagpur Division. Mr. Sunder's classification of tenants purported to be in accordance with the principles of the Bengal Tenancy Act, although this Act had no application to Chota Nagpur (see para. 9 of the Government Resolution on and published with Sunder's Pinal Report). It is not distinguished between agricultural and non-agricultural holdings, as we see from the last page of his appendix I (Tappa Kote). His description of Badrinath as dakhilkar or occupancy raiyat was plainly erroneous on the common case of the parties before us, and it is not altogether without significance that the respondents did not raise any issue below regarding the jurisdiction of the civil Court to try a suit for the ejectment of the heirs or successors of the so-called dakhilkar. Every consideration on which the learned Judge below raised the presumption of permanency thus fails on an examination of the facts of this case.

    13. It is not clear what the learned Subordinate Judge had in mind when he held that the suit was barred by the principle of equitable estoppel. The learned advocate for the respondents has suggested that estoppel arises because the defendants' house was constructed at least with the knowledge of the plaintiff. But that knowledge, such as it was, does not estop the plaintiff from denying that these defendants had any permanent right to the land; in asking for ejectment he is not relying on any facts which were unknown to the defendants and of which it was his duty to inform them. It is not the defendants' case that they were not aware of their actual rights but were misled by any representation made by the plaintiff; nor was the plaintiff under any obligation in these circumstances to warn them of their precarious right. If they built, they did so at their own risk notwithstanding the knowledge of the Deputy Commissioner that they (or rather their father) intended to build, There could be no estoppel by acquiescence unless these defendants showed that in spending money on the reconstruction of the house their father was acting under an honest, though mistaken, belief that he had a permanent right in the land and that the landlord knowing that he was acting under such belief purposely abstained from interference with the view of claiming the building when erected. But this was not even alleged by them. It is therefore impossible to say that the conduct of the plaintiff as landlord in abstaining from interfering with the reconstruction of the house justifies the legal inference that he had, by plain implication, contracted that the right of tenancy under which Badrinath had originally obtained possession of the land should be changed into a permanent right. We have thus neither the estoppel by representation that was found in 4 Pat 707,10 nor the estoppel by acquiescence referred to in 1 HL 129,11 from which an implied contract of permanency could be inferred: see, 21 All 496. In my opinion the learned Subordinate Judge was in error not only (as I have already shown) in drawing an inference or making a presumption of permanency of the Tenancy but also in holding that there was any equitable estoppel.

    14. In spite of his findings on these two points, the learned Subordinate Judge proceeded to assess a fair and equitable rent for the holding, apparently under the impression that R. 28(8) of the Government Estates Manual, which speaks of regular civil suits for ejectment with an alternative prayer for enhancement, gave the Court jurisdiction to assess rent in such cases. But as was pointed out in 6 Pat 446, the Court has no power to impose upon the parties a bargain not of their own making in a suit which does not relate to agricultural land governed by the (Bengal or) Chota Nagpur Tenancy Act:

    Once it is settled that the original bargain was for a permanent tenancy at a fixed rent, all question of enhancement is necessarily gone unless such proceeding is authorized by statute, as was said by Lord Dunedin in 47 Cal 1.12 As a matter of fact the Government pleader at first complained of the assessment made by the lower Court as arbitrarily low, but he finally conceded that the Court had no jurisdiction to make a bargain for the parties at all, nor was the contrary urged by the learned advocate for the respondents in view of what was said in the case in 6 Pat 446. Though the appellant is right in his contention that the lower Court erroneously held the tenancy to be permanent, he is still not entitled to ejectment in this suit. It is a tenancy from year to year that we are dealing with in this case, and the landlord can only terminate such a Tenancy by serving a proper notice to quit. The Subordinate Judge has shown that no notice was served upon defendant 2, one of the recognized tenants, but that a notice had been left with his minor brother, defendant 1, nor upon defendants 3 to 5, as to whom the case made in the plaint was that these defendants were not entitled to any notice because they were not recorded as lessees of the holding but that notice had been served on them to avoid legal objections. The Subordinate Judge's finding regarding non-service has not been assailed, and the mere circumstance that these defendants are not recorded as lessees is of little assistance to the landlord. For, if the Tenancy be transferable, non-recognition by the landlord would not affect the rights of the transferees; and if it be assumed that the Tenancy was non-transferable the contesting defendants have been in possession of the holding to the exclusion of the recorded tenants, from 1913 onwards, and as they have done so to the knowledge of the plaintiff, the claim to eject them without notice on the footing that they are trespassers could presumably be met by adverse possession of a Tenancy interest for over 12 years. This aspect of the matter was however not gone into below, doubtless because the holding was non-agricultural; and nothing has been said before us to suggest that even in 1913 such holdings were non-transferable.

    15. It follows that though the appellant has succeeded in his contention as regards the nature of the tenancy, none of the three prayers made in the plaint can be allowed. The appeal therefore fails except in the matter of the assessment made by the lower Court which is without jurisdiction and must be set aside. The suit should now stand dismissed. In the circumstances I would make no order about costs, the course properly adopted by the lower Court.

    K.B/A.L

    16. Order accordingly.

    Use AI to get other relevant cases.

    Comments

    Secretary Of State v. Babu Rajendra Prasad
    (Mar 1, 1937)