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Ganjhu Upendra Singh v. Ganjhu Meghnath Singh .
Judgment Summary — James, J. (concurring Rowland, J.)
Factual and Procedural Background
The judgment-debtor (appellant) holds a jagir in Ranchi District that traces to a tenure created in 1842 by the proprietor of the Barkagarh estate for services as a barkandaz. The estate was forfeited to Government, and in 1881 a new grant was created which commuted the services into an annual rent of Rs. 48-8-0 and granted the tenure to the descendants of an earlier jagirdar, Ratan Singh, so long as any descendants survived. The 1881 grant contained a stipulation prohibiting the jagirdar from transferring the tenure by sale or by creating mokarrari tenures, subject to liability to resumption if unauthorized transfer were made.
The decree-holder (respondent) sought to bring the jagir to sale in execution of a money decree. The Subordinate Judge dismissed the judgment-debtor's objection to sale, reasoning that the tenure did not come into existence by the 1881 grant and that restrictions in a lease do not prevent sale in execution. The Judicial Commissioner affirmed the Subordinate Judge's order, dismissing the appeal. The judgment-debtor appealed to the High Court.
Legal Issues Presented
- Whether the tenure in question (the 1881 grant/jagir) is a Crown grant affected by the Crown Grants Act and the Transfer of Property Act for the purposes of determining transferability and liability to sale in execution.
- Whether a stipulation in the grant prohibiting alienation prevents the jagir from being sold in execution of a money decree, or whether the restriction only affects voluntary transfers and not involuntary alienation by sale in execution.
- If sale in execution is precluded, what remedies remain available to the decree-holder (for example, attachment of rents and profits by appointment of a receiver)?
Arguments of the Parties
Appellant's Arguments (Mr. S.N. Bose)
- The 1881 grant is the same form of Crown grant considered by the High Court of Madras in ILR (1938) Mad 767, where it was held that decree-holders only possessed a right to enjoy rents and profits during their lives and that a tenure under a government grant with prohibition against alienation could not be sold in execution.
- The Judicial Committee decision in 59 Cal 1 supports the inalienability in circumstances where conditions of enjoyment were determined by formal legislation (though Mr. Bose distinguished the exact facts of that case).
- Reliance was placed on 10 Pat 582 (Sir Stewart Macpherson and Dhavle, J.), where the basis was stated that property is not liable to sale by the Court unless the judgment-debtor has a disposing power over it for his own benefit; "the measure of liability to involuntary alienation is the power of voluntary transfer."
Respondent's Arguments (Mr. S.M. Mullick)
- The jagir should not be regarded as a Crown grant at all because it was originally created by a private landlord as a service tenure.
- The restriction on transfer only renders a purchaser liable to discover that the grant may be resumed by the superior landlord after purchase; it does not prevent the tenure from being brought to sale in execution.
- Authorities such as 20 Cal 273 hold that a restriction on assignment in a lease does not apply to an assignment by operation of law (e.g., sale in execution). Similarly, 19 CWN 1182 held a condition of landlord re-entry on transfer did not prevent a sale by the Court.
- General proposition argued: prohibition against transfer in a grant or lease does not affect the liability of the tenant to have his estate brought to sale against his will.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| ILR (1938) Mad 767 | Held that the actual interest of decree-holders under a Crown grant with prohibition against alienation was merely a right to enjoy rents and profits during their lives; such tenure could not be sold in execution. | The court treated this decision as authority supporting the proposition that when a Crown grant contains a prohibition against alienation it takes effect according to its terms and precludes sale of the corpus in execution. |
| 59 Cal 1 | Shows circumstances where conditions of enjoyment were determined by formal legislation, leading to inalienability of the immovable property affected by that legislation. | The court noted the Judicial Committee decision but distinguished facts where applicable; used the principle to show that statutory or governmental-imposed restrictions can preclude alienation. |
| 10 Pat 582 | Expressed the principle (Macpherson, J.) that property is not liable to sale by the Court unless the judgment-debtor has a disposing power for his own benefit; "the measure of liability to involuntary alienation is the power of voluntary transfer." | The court approved and applied this principle: because the statute (Crown Grants Act) removes the power of voluntary transfer, the measure of liability to involuntary alienation is correspondingly removed and only rents/profits are available. |
| AIR 1937 Mad 864 | Part of a Division Bench decision of the High Court cited with approval by Sir Owen Beasley, C.J. | The court observed that part of the High Court's reasoning had been cited with approval in AIR 1937 Mad 864, lending support to the view that Crown grants with prohibitions are effective to limit transferability. |
| 20 Cal 273 | Holds that a restriction on assignment in a lease did not apply to an assignment by operation of law (sale in execution). | The court considered this authority but distinguished it on the ground that those cases involved private covenants, not a Crown grant of a limited non-assignable interest. |
| 19 CWN 1182 | Held that a condition in a permanent lease that landlord could re-enter if tenant transferred did not prevent a sale by the Court. | The court noted the decision and pointed out that the judges in that case distinguished it from 7 Bom 256 where there was an express prohibition on attachment or sale; the High Court here distinguished private-leasing authorities from Crown grants. |
| 7 Bom 256 | Contains a decision where there was a distinct prohibition on the tenant's permitting his tenure to be attached or sold in execution. | Served as a contrasting authority: where there is an express prohibition on attachment or sale the private-lease decisions differ; the High Court used the distinction between private covenants and Crown/ statutory prohibitions. |
| 27 All 6348 | Judicial Committee considered a grant with provisions (e.g., primogeniture) and held the Crown Grants Act was a complete answer to objections; Crown may grant lands on such terms. | The court relied on this to support the proposition that where a Crown grant contains a prohibition against alienation that prohibition must take effect as laid down in the grant. |
| Section 111(f), Transfer of Property Act | When a lessee accepts a new lease from his lessor to take effect during the continuance of the previous lease, this is an implied surrender of the former lease. | Rowland, J. applied this statutory provision to show that accepting the 1881 grant amounted to implied surrender of any earlier tenure, bringing the tenure squarely within the terms of the 1881 grant and the Crown Grants Act. |
| Section 10, Transfer of Property Act | Relates to covenants against alienation in leases; such restriction is void except where for benefit of lessor or those claiming under him (principles relevant to private leases). | The court observed that Section 10 and the jurisprudence on private covenants are not directly applicable to grants from the Crown or statutory restrictions; thus private-lease authorities do not control this Crown grant. |
Court's Reasoning and Analysis
The court's reasoning proceeded in several discrete steps, as expressed by James, J., and in concurrence by Rowland, J.:
- Characterisation of the tenure: The court held that the tenure created by the 1881 instrument is a Crown grant and is affected by the Crown Grants Act of 1895 and by the Transfer of Property Act, so that the grant must be interpreted according to its tenor and the statutory framework. The court rejected the view that the tenure was merely an older private tenure continued by the 1881 grant.
- Effect of the 1881 grant: Even if earlier ancestors held the tenure on different terms, nothing shows that the ancestors ever held a tenure that was transferable or subject to sale in execution. The 1881 grant commuted services into rent and explicitly restricted transferability; therefore the interest created was a limited, non-transferable interest enjoyed only by heirs of Ratan Singh.
- Distinction between private covenants and Crown/statutory restrictions: The court distinguished decisions about private covenants not to assign (e.g., decisions under Section 10 T.P. Act) from cases where a statutory or Crown-imposed prohibition restricts alienation. The court emphasised that it was not dealing with a private covenant but with a Crown grant of a limited non-assignable interest.
- Application of precedent and principle: The court approved the principle stated in 10 Pat 582 that "the measure of liability to involuntary alienation is the power of voluntary transfer." Because the statute (Crown Grants Act) takes away the holder's power of voluntary transfer insofar as sale or attempted sale is concerned, full ownership is cut down and only the profit during the holder's lifetime remains for the holder's disposal.
- Practical consequence for execution: Given the restricted interest, the decree-holder cannot subject the corpus of the jagir to sale in execution. The only remedy available to enforce the money decree against the judgment-debtor's interest is to obtain appointment of a receiver to collect rents and profits during the lifetime of the judgment-debtor (or until decree satisfaction), but not to sell the tenure itself.
- On procedural errors below: Rowland, J. added that the Subordinate Judge erred in concluding the Crown Grants Act did not apply. Acceptance of the 1881 grant constituted an implied surrender of any former lease (citing Section 111(f) T.P. Act), and therefore the 1881 grant properly governs transferability.
Holding and Implications
Holding:
APPEAL ALLOWED — the jagir created by the 1881 grant cannot be brought to sale in execution of the respondent's decree.
Implications (direct effect on the parties and scope of the ruling):
- The decisions of the Subordinate Judge and the Judicial Commissioner are set aside and the appeal succeeds with costs.
- The decree-holder cannot enforce the money decree by selling the jagir; instead, the decree-holder may seek the appointment of a receiver to collect the rents and profits of the jagir until the decree is satisfied or until the death of the judgment-debtor (whichever is shorter), thereby realizing the judgment-debtor's lifetime profits but not the corpus.
- The court rested its decision on established statutory and case-law principles (Crown Grants Act, Transfer of Property Act provisions, and cited precedents). The opinion applies those principles to the facts and does not state that it establishes a novel legal doctrine beyond its application to this tenure.
This summary is based exclusively on the text of the provided opinion. No information beyond that opinion has been added.
James, J.:— The appellant is a judgment-debtor who holds a jagir under Government in Ranchi District. His ancestor enjoyed a tenure which was created in 1842 by the proprietor of the Barkagarh estate, granted in consideration of services to be rendered as barkandaz. The estate was subsequently forfeited to Government, and in 1881 there was a formal dispensation with the services which the jagirdar had to render as bar kandaz, and a new grant was created of the tenure freed of those services, at an annual rent of Rs. 48-8-0. The new grant created a jagir for the descendants of an earlier jagirdar Ratan Singh to enjoy, so long as any descendants of Ratan Singh should survive. There was a stipulation that the jagirdar had no power to transfer by sale or by creation of mokarrari tenures any part of the tenure, with a liability to resumption if unauthorized transfer should be made. The opposite party sought to bring this tenure to sale in execution of his money decree: but the jagirdar objected that his jagir could not be brought to sale. The Sub-ordinate Judge dismissed this objection on the ground that the tenure in favour of the petitioner's ancestor did not come into existence by the grant of 1881, and on the general ground that where there is a stipulation in a lease restricting the right of transfer by the lessee, his interest can be sold in execution of a decree. The judgment, debtor appealed to the Judicial Commissioner who maintained the order of the Subordinate Judge and dismissed the appeal.
2. Mr. S.N Bose on behalf of the appellant argues that this is a grant of the same tenure as the Crown grant which was the subject-matter of proceedings before the High Court of Madras in ILR (1938) Mad 767,1 where it was held that the actual interest possessed by the decree-holders was merely a right to enjoy the rents and profits during their lives, and that the tenure enjoyed under a grant from the Government of Madras with a prohibition against alienation could not be sold in execution of a decree. Mr. Bose also refers to the decision of the Judicial Committee in 59 Cal 1,2 but there the conditions of the enjoyment of the estate of the Nawab of Murshidabad had been determined by formal legislation and there could be no question regarding the inalienability of the immovable property affected by that legislation. Mr. Bose also lays some stress upon the decision of Sir Stewart Macpherson and Dhavle, J. in 10 Pat 582,3, wherein the basis of the decision, to use the language of Macpherson, J., was that property is not liable to sale by the Court unless the judgment-debtor has a disposing power over it for his own benefit. The measure of liability to involuntary alienation is the power of voluntary transfer.
3. This part of the decision of the Division Bench of this High Court was cited with approval by Sir Owen Beasley, C.J in AIR 1937 Mad 8644 Mr. S.M Mullick on behalf of the respondent argues in the first place that this jagir ought not to be regarded as a Grown grant at all because it was originally created by a private landlord as a service tenure. He suggests also that the restriction on transfer merely renders the purchaser liable to find that the grant may be resumed by the superior landlord after purchase, but that it cannot prevent the tenure from being brought to sale in execution by a Court. In 20 Cal 273,5 which is cited by Mr. Mullick, it was held that a restriction on assignment in the lease did not apply to an assignment by operation of law taking effect against the will of the lessee by a sale in execution proceedings. Mr. Mullick also cites the decision in 19 CWN 1182,6 where it was held that the condition in a permanent lease that the landlord would re-enter if the tenant made any transfer of the land demised did not prevent a sale by the Court. The learned Judges in this latter case distinguished the lease before them from the lease which was under discussion in 7 Bom 256,7 on the ground that in the Bombay case there was a distinct prohibition on the tenant's permitting his tenure to be attached or sold in execution; and Mr. S.M Mullick argues generally that prohibition against transfer in a grant or a lease does not affect the liability of the tenant to have his estate brought to sale against his will.
4. How in the first place it appears to us that it cannot be reasonably held that the tenure which is here in question, is not a Crown grant, or that it is not a grant which is affected by the Crown Grants Act of 1895 in such a manner that the provisions of the Transfer of Property Act do not apply to it, so that it takes effect an cording to its tenor whatever may be the conditions laid down. It is possible that the ancestors of the jagirdar enjoyed this tenure on different terms before the grant, was made in 1881; but there is nothing to indicate that the ancestors of the tenure-holder ever at any time enjoyed a tenure which could be transferred or could be brought to sale in execution of a decree. The tenure for which services had to be rendered as barkandaz could certainly not be alienated without the consent of the grantor to whom the services were to be rendered. When in 1881 these special ser vices were commuted for an increased money rent payable by the jagirdar, the jagir would have become transferable if no restriction had been made in the grant: but the grant did make a clear restriction and it granted a limited interest which was not transferable. In the cases of the Calcutta High Court cited by Mr. S.M Mullick, it was remarked that involuntary alienation would not be a breach of a covenant nor to assign; but we are nor here concerned with a covenant not to assign, but with a grant by the Crown of a limited interest which was not assignable either by operation of law or by voluntary alienation. Mr. Mullick criticizes the view expressed in 10 Pat 582, that “the measure of liability to involuntary alienation is the power of voluntary transfer” pointing out that a Mitakshara coparcener may have his interest brought to sale in execution although he has no power of making a voluntary transfer; but the Mitakshara coparcener can always, by separating himself from the joint family, obtain a disposing interest over his own share; and where involuntary transfer is allowed in this way, the creditor is merely compelling the coparcener to do what he himself has power to do by applying for a partition.
5. The interest enjoyed by virtue of the grant of 1881 is a strictly limited interest in this way, that it is to be enjoyed by the heirs of Ratan Singh and by nobody else; and that what is granted is not a property which the heirs are to treat as their own in the sense that they may, if they please, transfer it to somebody else: it is a property created in the manner in which so frequently jagirs in India are created by the Grown which can be enjoyed only by the heirs of the grantee and cannot be alienated or assigned. No more can be brought to sale in execution of the decree than the judgment-debtor himself enjoys; and the judgment-debtor here possesses no right in the corpus of the property which can be assigned or which can be brought to sale. The only manner in which the decree-holder can utilize for his own benefit the interest of the jagirdar in this property is by obtaining the appointment of a receiver of the rents and profits until his decree is satisfied during the lifetime of the judgment-debtor whichever might be the shorter period. I would set aside the decisions of the Courts below and allow this appeal with costs. This jagir cannot be brought to sale in execution of the respondent's decree.
Rowland, J.:— I agree and would like to add a few observations. The Subordinate Judge rested his decision on the view that the Crown Grants Act did not apply to this tenure, and secondly, he was of opinion that if it did apply, it was of no advantage to the judgment-debtor. His view that the-Crown Grants Act did not apply was entirely erroneous. He thought that the tenure was not to be considered to be a tenure created by and held under the terms of the grant of 1881 but an older tenure which had merely been continued by that grant. The true position was that the lessee by accepting a new grant had made an implied surrender of the former lease. That is the position contemplated in Section 111(f) of the Transfer of Property Act. Where a lessee accepts from his lessor a new lease of the property leased to take effect during the continuance of the previous lease, this is an implied surrender of the former lease which is thus determined. The observation of the Subordinate Judge that the Government having only stepped into the shoes of Thakur Biswanath Sahi Deo on account of the confiscation of his estate, was not entitled to impose a fresh condition as regards the transferability of the tenure in question is plainly unsupportable. The Grown Grants Act was passed in order to prevent the Courts from saying that the Crown could not grant lands on such and such terms. Then the Subordinate Judge in construing the restrictions imposed on transfer has proceeded on a view which is supported by some authority in respect of grants made by private persons to private persons containing covenants against alienation.
6. Now such covenants are referred to in Section 10 of the Transfer of Property Act. The restriction on alienation is void except in a lease where the condition is for the benefit of the lessor or those claiming under him; and the validity of the condition has generally come in question in connexion with the claim of the lessor to forfeit the lease.
7. The Courts have generally been reluctant to enforce such a forfeiture; but the principles of those decisions do not seem to me to be applicable in the other class of cases where the restriction on alienability is expressed either in a Statute as in 59 Cal 1 and 10 Pat 582 or in the case of a grant from the Crown. In 27 All 6348 the Judicial Committee of the Privy Council considered the case of an estate granted by a sanad in which provision had been made for descent by primogeniture which was said to be at variance with the custom of the family. It was held that the Crown Grants Act was a complete answer to the contention that it was not open to the Grown in making a grant to alter the ordinary rules of succession in respect of the estate. When a Grown grant contains a prohibition against alienation of the estate that prohibition must take effect in accordance with its terms as held in ILR (1938) Mad 767. In all this class of cases the rule in my view is that laid down by Maopherson, J. in 10 Pat 582:
The measure of liability to involuntary alienation is the power of voluntary transfer. The latter is taken away from the holder by the statute so far as sale or attempted sale of the property is concerned and the exercise of it is rendered void. Full ownership is cut down—the holder's power of disposition for his own benefits is restricted to the profit accruing within his lifetime.
8. That being so, the creditor can only proceed in execution against the profits accruing and not against the estate or tenure itself.
D.B/R.K
9. Appeal allowed.
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