The case came on for hearing in the first instance before Spencer and Phillips, JJ., who made the following
ORDER OF REFERENCE TO A FULL BENCH
The question for determination in this case is whether the compensation for improvements is to be paid for at the rates stipulated for in the demises of 1876 or in accordance with the provisions of the Malabar Compensation for. Tenants' Improvements Act. In the Full Bench ruling Randupurayil Kunhisore v. Neroth Kunhi Kannan(1) it was held that in the case of, a contract made prior to let January 1886, the rate of compensation is governed by the terms of the contract. In a subsequent case Kozhikot Sreemana Vikraman v. Modathil Ananta Patter, Benson and Krishnaswami Ayyar, JJ., expressed an opinion (obiter) that if a contract as to the rate of compensation is unfavourable to the tenant even though it has been entered into before 1st January 1886, he is entitled to claim compensation under section 5 of the Act at the rates prescribed in sections 9-18, and remarked that this opinion was not opposed to the Full Bench ruling in Randupurayil Kunhisore v. Neroth Kunki Kannan(2) as the question therein answered was whether the making of the improvements after 1886 disentitled the tenants to the rates fixed by the contract before that date. This, we think, hardly expresses the matter correctly. Although the question in dispute in the suit was as to the rate payable for improvements made after 1886, the question referred to the Full Bench was couched in general terms as follows:—
“In the case of a contract made prior to 1st January 1886, is the rate of compensation which a tenant is entitled to receive governed by the terms of the contract or by the provisions of the Malabar Compensation for Tenants' Improvements Acts of 1887 and 1900 and the answer given was that in the case of a contract made prior to 1st January 1886, the rate of compensation is governed by the terms of the contract. This being so, we do not think that the facts of the case can warrant us in reading into the answer a modification that is not there, for the decision of the Full Bench is merely an answer to the question propounded and is not, unless expressly so stated, to be considered as a decision which must be construed as governed by the facts of the casein which the reference is propounded, when no reference is made to those facts in the question referred to the Full Bench. The same view, of the law was followed, by another Divisional Bench (Benson and Sundara Ayyar, JJ.) in Paru Amma v. Kunhikandan(3) and it was held that section 19 of the Act referred only to contracts which took away or limited the right of a tenant both to make improvements and to claim compensation, for them in accordance with the provisions of this Act, and not to contracts which merely regulated the amount of compensation that they could claim. In Kochu Rabia v. Abdurahman two other learned Judges of this Court (Sadasiva Ayyar and Tyabji, JJ.) thinking that the decisions in Kozhikot Sreemam Vikraman v. Modathil Amnia Patter and in Paru Amma v. Kunhikandan were not in accordance with the Full Bench ruling in Randupurayil Kunhisore v. Neroth Kunhi Kannan(4) and that the distinction drawn between the right of a tenant to make improvements and to claim compensation for them and his right to claim under an agreement which does not expressly refer to his power to make improvements was somewhat hypercritical, referred the following questions to a Full Bench:—
(1) “Whether a contract which is made prior to the 1st January 1886 and which regulates the rates of compensation claimable by the tenant for improvements or provides for methods of fixing the amount of compensation due to him (such rates or methods not being in accordance with the provisions in sections 5 and 6 of the said Malabar Compensation for Tenants' Improvements Act) but which does not expressly refer to the tenant's right to make improvements, is not binding on him if such a contract is less favourable to him than sections 5 and 6 of the Act, and whether the tenant is entitled to repudiate the contract and to claim compensation according to the provisions of the Act, and whether section 19 of the Act affects such contracts.”
(2) “Whether Kozhikot Sreemana Vikraman v. Modathil Ananta Patten and Paru Amma v. Kunhikandan have correctly interpreted the Full Bench decision in Randupurayil Kunhisore v. Neroth Kunbi Kannan.”
The reply of the Full Bench to the first question was that the contract mentioned therein was not binding on the tenant if it is less favourable to him than sections 5 and 6 of the Act. In reply to the second question, the Court was of opinion that, having regard to the question which the Court had to consider in Randupurayil Kunhisore v. Neroth Kunhi Kannan, there was no in consistency between the judgment in that case and the judgments in Kozhikot Sreemana Vikraman v. Modathil Ananta Patter and in Paru Amma v. Kunhikandan, and remarked in conclusion “we are not prepared to say that the last two cases were not rightly decided.” It will thus appear that the prior ruling in Randupurayil Kunhisore v. Neroth Kunhi Kantian was not dissented from, and as regards Kozhikot Sreemana Vikraman v. Modathil Ananta Patter and Paru Amma v. Kunhikandan it was held that they were not wrongly decided. In Kozhikot Sreemana Vikramm v. Modathil Ananta Patter the case was decided quite apart from the opinion expressed obiter which the learned referring Judges in Kochu Rabia v. Abdurahman considered to be in conflict with the ruling in Randupurayil Kunhisore v. Neroth Kunhi Kannan and in Paru Amma v. Kunhikandan the contract under consideration was of a peculiar nature and did not merely regulate the rates of compensation. It would appear therefore that both the Full Bench rulings, i.e, in Randupurayil Kunhisore v. Neroth Kunhi Kannan and in Kochu Rabia v. Abdurahman are still in force and are binding on us. The question for decision in the case before us now is whether the rate of compensation which the tenants are entitled to receive is to be governed by the contracts of 1876 or by the provisions of the Malabar Compensation for Tenants' Improvements Act. According to the decision in Randupurayil Kunhisore v. Neroth Kunhi Kannan the tenants are entitled only to the rate of compensation contained in the contract. The question might, however, be put in the form of the first question referred to the Full Bench in Kochu Rabia v. Abdurahman and according to the opinion expressed in that case the answer must be that the contract is not binding on the tenant if it is less favourable to him than sections 5 and 6 of the Act and consequently the tenants would, be entitled to the higher rates provided in the Act. These two answers in the present case are directly conflicting, and as both the rulings are binding on us, the latter one not having in any way dissented from the former, we are in doubt as to which ruling to follow and think that the question should he again referred to a Full Bench. No doubt in Abdulla Rowthan v. Rajah Vasudeva Ravi Varma(5) one of the referring Judges in Kochu Rabia v. Abdurahman, Sadasiva Ayyar and Napier, JJ., interpreted the ruling on their reference as holding that the decision in Randupurayil Kunhisore v. Neroth Kunhi Kannan should not be construed as negativing the tenant's right to claim compensation according to the Act if the terms of the agreement are less favourable to him, but we are unable to trace such a ruling in Kochu Rabia v. Abdurahman, where it is only stated that Kozhikot Sreemana Viktaman v. Modathil Ananta Patter and Paru Amma v. Kunhikandan were not inconsistent with Randupurayil Kunhisore v. Neroth Kunhi Kannan and were rightly decided. As we have pointed out Kozhikot Sreemana Vikraman v. Modathil Ananta Patter was decided on quite a different point, and Paru Amma v. Kunhikandan related to a contract of a somewhat peculiar nature unlike the usual contract regulating the rate of compensation. As regards the provisions of section 19 of the Act and the opinion held in Kozhikot Sreemana Vikraman v. Modathil Ananta Patter and in Paru Amma v. Kunhikandan that the section only refers to contracts limiting the right to make improvements and to claim compensation and not to contracts merely regulating the rate of compensation payable, we would like to identify ourselves with the remarks made by the referring Judges in Kochu Rabia v. Abdurahman and would also add a further observation which seems to have escaped notice in the cases referred to above. Section 19 of the Act prescribes that contracts of a certain class made after 1st January 1886 shall be inoperative, but it is not apparent that the provisions of the section affect in any way contracts made before that date. Any contracts made before that date whether of the class referred to in section 19 or of any other nature, must be considered and their validity determined according to law apart from any consideration of section 19, which does not purport to be retrospective in effect. In the case therefore of a contract regulating the rate of compensation payable and entered into before 1st January 1886, the question for determination does not seem to us to be, whether it is a contract of the nature contemplated in section 19, but whether it is a contract which is valid and binding according to law, and more especially the law as contained in section 28 and other provisions of the Contract Act. If prior contracts of the nature specified in section 19 are rendered invalid by reason of the passing of the Tenants' Improvements Act or are invalid in law for any other reason, section 19 would appear to be superfluous, for contracts after 1st January 1886 would be invalid for the same reason and there is no reason for declaring their invalidity by a special provision of the Legislature.
We therefore again refer the following questions for determination by a Full Bench as they are questions which are constantly cropping up and in many cases, as in the present one large sums of money are involved:—
(1) When a contract has been entered into between a Malabar tenant and his landlord before 31st January 1886, according to which compensation is payable at certain rates therein specified, is such contract valid and binding on them, whether the rates are more or less favourable to either party than the rates prescribed by the Malabar Compensation for Tenant' Improvements Act?
(2) When the question of the rate of compensation comes up for determination at a date after the introduction of the Act, can either party to a contract entered into before 1st January 1886 elect to have the rates fixed according to the Act in preference to the rates mentioned in the contract?
On this references—
C.V Anantakrishna Ayyar for the appellant.
C. Madhavan Nair for the first respondent.
The other respondents neither appeared in person nor by pleader.
OPINION
The decision of the Full Bench of four Judges in 1892 in Kerala Varmah Valia Rajah v. Ondan Ramunni proceeded upon the footing that the intention of the Legislature was that contracts made before the date mentioned should stand unaffected by the Act, in other words that sections 5 and 6 (corresponding) to sections 4 and 5 of the earlier Act did not apply to cases governed by such contracts. This was expressly decided in Viru Mammad v. Krishnan. If this contention was not in accordance with the intention of the Legislature, it would hardly have refrained from putting the matter right when repealing and re-enacting the Act with modifications in 1899. In 1908 it was again held by a Full Bench in Randupurayil Kunhisore v. Neroth Kunhi Kannan that section 19 (formerly 7) did not affect the validity of contracts made prior to the 1st of January 1886 whether the improvements were made before or after the coming into force of the Act of 1887. In 1910 Benson and Krishnaswami Ayyar, JJ., in Kozhikot Sreemana Vikraman v. Modathil Ananta Patter, whilst disposing of the case on another ground, suggested that, while prior contracts dealing with right to make improvements and claim compensation for them were saved under the Act, this was not the case with prior contracts dealing only with the rates at which compensation was to be paid. This view was adopted in Paru Amma v. Kunhikmdan in 1911 by Benson and Sundara Ayyar, JJ., who refused to give effect to a contract made prior to January 1886 which did not restrict the tenant's right to make improvements but only the rates payable for such improvements. In 1913 Sadasiva Ayyar and Tyabji, JJ., referred to a Full Bench the questions whether such contracts were enforceable, and whether the two last mentioned decisions were consistent with the Full Bench decision in Randupurayil Kunhisore v. Neroth Kunhi Kannan. The Full Bench answered, without assigning reasons, that such contracts were not enforceable if less favourable to the tenant than sections 5 and 6 of the Act, and that the decisions in Kozhikot Sreemana Vikraman v. Modathil Ananta Patter and in Paru Amma v. Kunhikandan were not inconsistent with the Full Bench ruling in Randupurayil Kunhisore v. Neroth Kunhi Kannan. The question has again been referred to a Full Bench by Spencer and Phillips, JJ., on the ground that the Full Bench decision in Kochu Rabia v. Abdurahman is inconsistent with the earlier Full Bench decision in Randupurayil Kunhisore v. Neroth Kunhi Kannan and that they are in doubt which to follow, and has now come before a bench of five Judges.
After hearing the whole question re-argued we agree with the referring Judges in Kochu Rabia v. Abdurahman and in the present case that the view advanced in Kozhikot Sreemana Vikraman v. Modathil Ananta Patter and adopted in Paru Amma v. Kunhikandan and accepted by the Full Bench in Kochu Rabia v. Abdurahman cannot be supported. Section 19 (formerly 7) which deals in terms with future contracts cannot, in our opinion, be construed as dealing only with contracts which take away or limit the right of a tenant to make improvements and also limit his right to claim compensation for them Under the Act, but applies equally to contracts which take away or limit either of these rights. It is, we think, clear that the Legislature intended to prohibit all future contracts taking away or limiting either or both of these rights. It is well settled that the word “and” may be read as “or” where it is necessary to do so in order to carry out the obvious intention of the Legislature (Maxwell on Statutes, 331, 3rd edition). The existence of a proviso excluding from the operation of the section a particular class of contracts dealing with the compensation payable under the Act, and the insertion of the word “to “before “claim” when the original section 7 was re-enacted as section 19 also support this view. If, as we hold, contracts, affecting only the right to claim compensation, come within the section, the suggested distinction fails, and we are bound, following the uniform course of decisions in this Court, to answer the first question referred to us in the affirmative and second in the negative.
K.R