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  • Mohamad Noor, J.
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Smart Summary

Structured Summary of the Opinion

Factual and Procedural Background

Two appeals arise from suits by the same plaintiffs (representatives of two ladies, Bibi Tahera and Bibi Kubra) to recover thica rent under verbal (mustajiri) leases. The defendant in both suits is the same person. At trial the plaintiffs obtained decrees, but the lower appellate Court dismissed the suits holding that the verbal leases fell within the mischief of Section 107 of the Transfer of Property Act and were therefore not legal leases; consequently the defendant was not a tenant and the plaintiffs were not entitled to recover rent. Decrees for use and occupation were refused because the suits were not founded on that claim. The plaintiffs appealed.

Relevant facts found by the Courts: 19 gandas (shares) of the village belonged to the two ladies, but Register D recorded the name of their brother, Nawabzada Iqbal Husain. The defendant had taken leases from the Nawabzada for the years 1321–1327. During that period the ladies got their names registered in the Collectorate; the Nawabzada directed the defendant to pay rent to them and the defendant paid some rent. The lease from the Nawabzada ended in 1327. The lower appellate Court found that thereafter fresh verbal leases were granted by the two ladies to the defendant for seven years (1328–1334). The present suits seek rent for the last four years (1331–1334) of that verbal lease. The defendant generally denied liability but did not specifically deny possession; the District Judge found the defendant was in possession and the plaintiffs were the proprietors.

Legal Issues Presented

  1. Whether the equitable doctrine of part performance can be invoked to support recovery of rent under the verbal leases alleged, notwithstanding the statutory prohibition in Section 107 of the Transfer of Property Act.
  2. Whether, if a decree for rent cannot be passed, the plaintiffs are entitled to decrees for use and occupation of the shares in suit.
  3. Whether, alternatively, the defendant should be taken to have held over after the termination of a valid lease such that he became a year-to-year tenant (thereby entitling plaintiffs to rent), either by virtue of the original (invalid-grantor) lease or by reference to the verbal lease for 1328 which, if valid for one year, might give rise to holding over under Section 116 of the Transfer of Property Act.

Arguments of the Parties

Appellants' Arguments (Plaintiffs)

  • The cases do not fall within the mischief of Section 107 of the Transfer of Property Act, and because the defendant took possession under the verbal leases and paid rent as a lessee, the equitable doctrine of part performance should be applied so that rent be decreed.
  • Alternatively, if rent cannot be decreed, the plaintiffs should be granted decrees for use and occupation of the shares in suit.
  • Even if part performance cannot be invoked, the defendant must be treated as having held over under a legal lease: either the original lease (which expired in 1327) or the verbal lease which was valid for one year (1328), thereby attracting the law of holding over and making the defendant a year-to-year tenant entitled to be charged rent for subsequent years.

Respondent's Arguments (Defendant)

  • The defendant generally denied liability and denied having taken a lease of the shares from the two ladies; there was no detailed affirmative case presented in the opinion by the defendant beyond these denials.
  • On the question of decrees for use and occupation, the respondent resisted such relief relying on authorities holding that in a suit for rent, in the absence of an alternate claim, compensation for use and occupation cannot be decreed.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Baijnath v. Kundan Lal (A.I.R. 1929 Allahabad 831) Refusal to allow doctrine of part performance to override express statutory provisions. The District Judge relied on this authority to refuse to apply part performance; the opinion refers to it as antecedent authority supporting that view.
Ram Gopal v. Tulshi Ram (A.I.R. 1928 Allahabad 641) (Full Bench) Same general principle as Baijnath — part performance cannot prevail against statutory provisions. Followed by Baijnath; relied on by the District Judge in refusing to apply part performance.
Jogendra Krishna Ray v. Kurpal Barshi & Co. (Calcutta High Court) Held (in earlier Calcutta decisions) that part performance could be applied to validate rights under verbal leases in some circumstances. Relied upon by the appellants; the Allahabad High Court had expressly dissented from this line of authority.
Raghunath Bhagat v. Sultan (decision of this Court) Authorities relied upon by appellants in support of part performance (no further detail in the opinion). Cited by appellants but not discussed in detail; the Court treated the question as settled by later/overruling authorities.
Ariff v. Jadunath Majumdar (Privy Council) Held that equitable doctrines (part performance) could not be used to nullify express provisions of the Indian statutory code relating to property and transfers; emphasized that such equitable rights cannot operate to override statutory requirements. The Court treated this decision as settling the question against allowing part performance to prevail over the statute and used it to reject the appellants' part performance argument.
Walsh v. Lonsdale Discussed in Ariff judgment; used to illustrate situations where equitable treatment operates (contextualized by limitation bars to specific performance). The opinion quotes the Privy Council's discussion of Walsh v. Lonsdale to reject appellants' argument that Ariff supports their position when specific performance had not been barred.
Rachhea Singh v. Upendra Chandra Singh Rule that in a suit for rent, in the absence of an alternative claim, compensation for use and occupation cannot be decreed. The respondent relied on this authority to oppose a decree for use and occupation.
Bhuki Koer v. Ram Khelawan Pershad Same rule as Rachhea Singh regarding inability to obtain compensation for use and occupation where no alternate claim is pleaded. Also relied upon by the respondent to resist the plaintiffs' claim for use and occupation.
Gobinda Sunder Sinha v. Srikrishna Chakravarti Recognizes the Court's discretion to allow amendment of a plaint where omission was due to inadvertence or mistake; the test is whether the defendant would be taken by surprise. Appellants relied on this for the proposition that the plaint could be amended to claim use and occupation; the Court observed amendment would have been permissible but did not need to decide because it accepted the third ground.
Lukhee Kant v. Sumeerooddi (Full Bench) Foundation for the rule that the plaint may be amended in certain circumstances; underlying full-bench authority cited in Gobinda Sunder Sinha. Cited via Gobinda Sunder Sinha as part of the jurisprudence on amendment of pleadings; used to evaluate whether amendment would prejudice the defendant.
Lakshmi Bai v. Hari Identified as part of the true test for allowing amendment: whether the defendant will be taken by surprise. Cited in the discussion of amendment of plaint (via Gobinda Sunder Sinha).
Balmakund v. Dalu Also cited as authority concerning the test for allowing amendment (surprise to defendant). Referenced in the Court's consideration of whether the plaint could be amended.
Mohammad Moossa v. Jaganund Singh (Calcutta High Court) Held that a verbal lease for more than one year, if accompanied by delivery of possession, is valid for one year. The Court applied this principle to hold that the verbal lease was valid for the year 1328; continuation of possession after that year constituted holding over, attracting Section 116 and making the defendant a year-to-year tenant entitled to rent.

Court's Reasoning and Analysis

The Court proceeded in the following analytical steps, strictly on the basis of the findings and legal authorities stated in the opinion:

  1. Factual foundation: The District Judge's factual findings that the defendant was in possession of the shares and that the shares belonged to the plaintiffs were accepted. The leases were verbal and the lower appellate Court had dismissed the suits under Section 107 of the Transfer of Property Act.
  2. Part performance argument (first issue): The appellants relied on equitable part performance because the defendant had entered possession and paid rent. The District Judge had declined the doctrine on the authority of Allahabad High Court decisions (Baijnath and Ram Gopal). The appellants pointed to Calcutta High Court authority and other decisions, but the Court regarded the matter as settled by the Privy Council decision in Ariff v. Jadunath Majumdar, which held that any equity of part performance cannot operate to nullify the statutory provisions governing property and transfers. The Court further noted the statutory development: the Transfer of Property Amendment Act (Act 20 of 1929) introduced Section 53-A, which recognizes part performance but with limitations, including the necessity of some writing from which the term of the contract can be ascertained. The Court concluded that prior decisions permitting part performance without the required writing were no longer good law and refused to allow part performance to prevail against the statute where Section 53-A did not apply.
  3. Use and occupation claim (second issue): The respondent relied on authorities that, in a suit for rent without an alternate claim, compensation for use and occupation cannot be decreed. The appellants cited cases allowing amendment of pleadings where omission was inadvertent and where the defendant would not be surprised. The Court observed that the plaint could have been amended (and that the defendant would not have been prejudiced), but because the Court accepted the appellants' third ground, it did not need to pursue the amendment question further.
  4. Holding over / year-to-year tenancy (third issue): The opinion analyzed two relevant leases: (a) the lease granted by Nawabzada Iqbal Husain (who had no title to the ladies' share at the time), and (b) the subsequent verbal lease alleged to have been granted by the two ladies for 1328–1334. The Court held that the earlier lease granted by the Nawabzada enured to the benefit of the rightful owners once the ladies' names were registered and the Nawabzada directed rent payments to them. However, the Court agreed with the District Judge that the possession after 1327 was not holding over under that earlier (Nawabzada) lease because there was a definite case of a fresh verbal lease for 1328–1334. The District Judge had not addressed holding over in relation to the verbal leases themselves. The Court applied the Calcutta High Court's decision in Mohammad Moossa v. Jaganund Singh, which holds that a verbal lease for more than one year accompanied by delivery of possession is valid for one year. Applying that principle, the Court held that the verbal leases were valid for the year 1328 (the defendant was the ladies' tenant for that year and the ladies could not dispossess him in that year). Because there was no fresh, valid lease beyond 1328, the defendant's continued possession after 1328 amounted to holding over. That situation attracted Section 116 of the Transfer of Property Act, and the defendant thereby became a tenant from year to year of the rightful owners (and subsequently the plaintiffs), making the plaintiffs entitled to recover rent for the subsequent years in suit.
  5. Statute circumvention concern: The Court rejected any submission that this result amounted to circumvention of the statute. The Court reasoned that the statute prescribes the mode of creation of a lease and that non-compliance affects the lease's formal effect, but the statute does not expressly address all rights arising under an invalid lease; statutory recognition of holding over (Section 116) may give rise to landlord-tenant relations notwithstanding initial defects in lease creation.
  6. Result and costs: On this reasoning the appeals were allowed; the decrees of the lower appellate Court were reversed and the decrees of the trial Court restored. The appellants were awarded costs, including costs of the lower appellate Court. Leave to prefer Letters Patent Appeals was granted.

Holding and Implications

Holding: APPEALS ALLOWED; the decrees of the lower appellate Court are reversed and the decrees of the trial Court are restored.

Direct consequences and orders announced by the Court (as stated in the opinion):

  • The plaintiffs (appellants) are entitled to recover rent for the years in suit because the defendant, having been tenant for the year 1328 under a verbal lease (valid for that year by virtue of delivery of possession), held over after 1328 and became a tenant from year to year under Section 116 of the Transfer of Property Act.
  • The appeals are allowed with costs; the appellants will recover their costs of the lower appellate Court as well.
  • The Court granted leave to the respondent to prefer Letters Patent Appeals.

Broader implications:

The opinion applies settled authorities (notably the Privy Council in Ariff v. Jadunath Majumdar and the statutory development in the Transfer of Property Amendment Act introducing Section 53‑A) to limit the availability of equitable part performance in cases where it would operate to nullify express statutory requirements. It also applies the Calcutta High Court principle that a verbal lease accompanied by delivery of possession is valid for one year, leading to the operation of holding over under Section 116. The decision resolves the parties' rights in this case by restoring the trial Court's decrees; the opinion does not purport to establish a novel general principle beyond applying existing authorities and statutory provisions to the facts before the Court.

End of summary.

Show full summary ...

    Aziz Ahmad v. Alauddin Ahmad

    1. These two appeals are by the same set of plaintiffs in suits for recovery of thica rent under verbal leases which have been described as mustajiri leases. The defendant in both the suits is the same. The suits though decreed by the trial, Court have been dismissed by the lower appellate Court on the ground that the lease being a verbal one was not legal under Section 107 of the Transfer of Property Act, and therefore the defendant was not a tenant and the plaintiffs were not entitled to recover any rent. Decrees for use and occupation of the land were refused as the suits were not based on that ground. The plaintiffs have appealed. It will be useful to state a few facts in order to understand the legal position of the parties.

    2. Nineteen gandas of the village belonged to two ladies, Bibi Tahera and Bibi Kubra, daughters of the late Nawab Amir Hasan Khan. In register D of the Collectorate however the name of their brother, Nawabzada Iqbal Husain, and not of the two ladies, was recorded in respect of these shares, and it is not disputed that the defendant took leases of these shares from the Nawabzada for the years 1321 to 1327. During the currency of the lease the ladies got their names registered in the Collectorate and, as found by the lower appellate Court, the Nawabzada directed the defendant to pay the rent of the share in question to them and the defendant did pay some rent to them. That lease ended in 1327. Thereafter, according to the finding of the lower appellate Court, there were fresh verbal leases granted by the two ladies to the defendant for 7 years, i.e, for 1328 to 1334. The present plaintiffs are the representatives in interest of the two ladies, and it is on the basis of these verbal leases that the plaintiffs have instituted the suits for recovery of rent for four years from 1331 to 1334, that is, the last four years of the verbal lease. I must state at the outset that except denials of liability the defendant has not made any specific statement as to his position in respect of the rent claimed shares. Though he denies having taken a lease of the share from the two ladies, there is no denial of his being in possession of the shares during the years in suit.

    3. This point however need not be pursued further as, according to the finding of the learned District Judge, it is clear that the defendant was in possession of the share in suit and there is no question that the shares in suit belong to the plaintiffs. The plaintiffs' suits have been dismissed, as I have said, on the ground of invalidity of the lease as coming within the mischief of Section 107 of the Transfer of Property Act. Three points of law were urged by the plaintiffs before the District Judge and have been repeated here in these appeals. They are these: (1) that the cases do not come within the mischief of Section 107 of the Transfer of Property Act. The defendant having taken possession under the verbal leases and having paid rent as a lessee the equitable doctrine of part performance should be applied and rent decreed; (2) that if no decree for rent can be passed, the plaintiffs are entitled to decrees for use and occupation of the shares in suit; (3) that even if the doctrine of part performance cannot be applied, the defendant must be taken to have held over under a legal lease, either the original lease which expired in 1327, or the verbal lease which was valid for one year, i.e, 1328 shall take up these three contentions one after the other. In my opinion the plaintiffs cannot invoke the aid of the doctrine of part performance. The learned District Judge refused to apply it on the authority of Baijnath v. Kundan Lal (A.I.R 1929 Allahabad 831), which followed a Full Bench decision of that Court in Ram Gopal v. Tulshi Ram (A.I.R 1928 Allahabad 641). The learned advocate for the appellants however relies upon the decision of the Calcutta High Court in Jogendra Krishna Ray v. Kurpal Barshi & Co. (1), which followed some earlier decision of that Court. The Allahabad High Court expressly dissented from this case as they held that the equitable doctrine of part performance could not be so applied as to override an express provision of a statute. The appellants also rely upon a decision of this Court in Raghunath Bhagat v. Sultan (2). It is needless to discuss the conflict between the judicial pronouncements in India on this topic as, in my opinion, the question has been set at rest by the decision of the Judicial Committee of the Privy Council in Ariff v. Jadunath Majumdar (3). There a tenant had entered into possession of a piece of land under a contract for perpetual lease. This perpetual lease was never executed. When the suit for specific performance of contract had become barred the landlord instituted the suit for recovery of possession, which was resisted on the ground of part performance. This was accepted by the Courts in India but was overruled by the Privy Council. The last part of the judgment of their Lordships runs thus:

    “Their Lordships cannot find that the facts of this case raise any equity in favour of the respondent. Even if any such equity was established, their Lordships are of opinion that it could not operate to nullify the provisions of the Indian Code relating to property and transfers of property.”

    4. In my opinion therefore this observation of their Lordships has overruled those decisions in which the doctrine of part performance was allowed to prevail against the specific provisions of the statute. Mr. Khurshed Husnain on behalf of the appellants has however contended that this decision only applies when the remedy of specific performance of contract has become barred and their Lordships' decision would have been otherwise if the remedy had not become barred. He relies upon a passage in the judgment of their Lordships at p. 101 of the report. It runs thus:

    “Their Lordships find themselves in agreement with the High Court in the view that Walsh v. Lonsdale (4) has no application to this case owing to the fact that the respondent's right to enforce the verbal contract had been barred long before the commencement of the present suit, respondent was not in a position to obtain specific performance of the agreement for a lease from the same Court and at the same time as the relief claimed in this action. Had he been so entitled, the position would be very different, for then the respondent could claim to have executed in his favour by the appellant an instrument in writing which he could duly have registered, the appellant's ejectment action being stayed in the meantime. In these circumstances the respondent would obtain complete protection, but consistently with and not in violation of the provisions of the Indian statute.”

    5. The last sentence is entirely against the argument of the learned advocate. Their Lordships do not say that if the right of specific performance of contract had been subsisting, the respondent in that appeal could have resisted the plaintiff's suit without having instituted a suit for specific performance of contract. They say that the respondent's rights would have been protected by institution of such a suit, the suit for ejectment being allowed to await the result of that suit. Apart from this, in my opinion, the effect of the case law on part performance has been affected by the passing of the Transfer of Property Amendment Act (Act 20 of 1929) which came into force on 1st October 1929. The legislature must be presumed to have been aware of the case law on the doctrine of part performance as laid down by the several High Courts of India. Being cognizant of those decisions they intervened and enacted Section 53-A of the Transfer of Property Act, which has recognized the doctrine of part performance but with certain limitations, one of them being that there must be some writing from which the term of the contract can be ascertained with reasonable certainty. In my opinion therefore those decisions which allowed the doctrine of part performance to prevail even in cases where there was no writing, are no longer good law and I am unable to allow the doctrine of part performance to prevail against the express provision of the statute when it does not come within four corners of Section 53-A of the Transfer of Property Act. The next point is whether the plaintiffs are entitled to decrees for use and occupation of the shares. This is resisted by Mr. Fakhruddin, who appears on behalf of the respondent, on the authority of Rachhea Singh v. Upendra Chandra Singh (5) and Bhuki Koer v. Ram Khelawan Pershad (6). These two cases lay down that in a suit for rent in the absence of alternate claim, compensation for use and occupation cannot be decreed. Mr. Kurshed Husnain however relies on Gobinda Sunder Sinha v. Srikrishna Chakravarti (7) where at p. 543 of the report Mookerjee, J., referring to she Full Bench decision of Lukhee Kant v. Sumeerooddi (8) on which the above cases were based observed as follows:

    “But the decision of the Full Bench in the case of Lukhee v. Sumeerooddi shows that the rule is not inflexible, because it is always in the discretion of the Court to amend the plaint or the issue, and where the omission has been from inadvertence or mistake, it would generally be proper to do so. The true test, as pointed out in the cases of Lakshmi Bai v. Hari (9) and Balmakund v. Dalu (10), is whether the defendant will be taken by surprise. No doubt, ordinarily a plaintiff must be limited to the case which he puts forward in his plaint; but although an alternative case is not expressly put forward, he may have leave to amend his plaint, if the Court thinks that he has based his claim on wrong grounds from misinformation, ignorance of law or fact, or mistake or misconstruction of documents.”

    6. Evan if I accept the contention of the appellants the plaint will have to be amended. As there would have been no question of prejudice to the defendant would have adopted that course for the ends of justice, but as, in my opinion, the plaintiffs are entitled to succeed on the third ground, do not wish to pursue this matter further. The third point raised is whether the defendant can be said to have held over after the termination of his leases. Now there are two leases in point. One is the lease which was granted by Nawabzada Iqbal Husain who was not entitled to grant such a lease of the share of the two ladies, Mt. Kubra and Mt. Tahera. The second was the verbal lease granted by the ladies themselves. The learned District Judge has considered the first only, and has refused to treat the subsequent possession of the defendant as holding over after the termination of that lease. He says as follows:

    “This contention is not worthy of any serious consideration regard being had to the fact that the kabuliyat did not mention the names of the ladies as proprietors or lessors; they were not registered proprietors in respect of any share when the kabuliyat was executed and the clear specific case of the plaintiff in the plaints about the lease to the defendant (verbal) in 1328 to 1334 Fasli.”

    7. The fact that when the earlier lease was granted the names of the ladies were not recorded in the Collectorate is, in my opinion, immaterial. The lease was granted by a man who had no right to grant it for the ladies' share. Subsequently the position was cleared up and the lessor directed the lessee to pay rent to the two ladies. The lessee attorney them and made payments of rent to them. Therefore there is no question that the lease granted by the Nawabzada enured afterwards to the benefit of the rightful owner, the two ladies. The fact that the names of the ladies were not recorded in the Collectorate record only prevented them from getting a decree for rent, but that did not affect their right in the property. Once their names were registered the bar to the recovery of rent was removed and they were entitled to realise rent. I am however of opinion that the plaintiffs cannot maintain that the possession of the defendant subsequent to the year 1327 was in consequence of his holding over after the termination of this lease, because there is a definite case, as has been pointed out by the learned District Judge that there was not holding over but a creation of a fresh lease for seven years from 1328 to 1334.

    8. The learned District Judge has however not considered the applicability of the principle of holding over to the verbal leases. It has been held by the Calcutta High Court in Mohammad Moossa v. Jaganund Singh (11) that a verbal lease for more than one year is valid for one year, if it is accompanied by delivery of possession. This decision is applicable to the facts of the present case. Here by virtue of the leases which were in contravention of Section 107 of the Transfer of Property Act, the defendant did take possession of the leasehold property. The leases were perfectly valid leases for the year 1328 and for that year the defendant was their tenant. The ladies were not entitled to dispossess the defendant in that year, namely, in the year 1328. There was then no fresh lease in favour of the defendant. The continuance of possession of the defendant after the termination of 1328 could not have been otherwise than the holding over by the defendant, and the provision of Section 116 of the Transfer of Property Act, is attracted. This being the case, in my opinion, the defendant was the tenant of the ladies and then of the plaintiffs for the subsequent years also, the nature of his tenancy being from year to year. In that view of the case, in my opinion, the plaintiffs are entitled to rent. It may be said that the view have taken would mean the circumvention of the statute. I do not think so. The statute only prescribes the mode of creation of a lease. The effect of its non-compliance will be that the lease will be of no effect for the period. The statute does not say anything about the rights of the parties under the invalid lease and holding over has been recognized by the statute itself. The appeals are allowed with costs. The decrees of the lower appellate Court are reversed and those of the trial Court restored. The appellants will get their costs of the lower appellate Court also. The learned advocate for the respondent applies for leave to prefer Letters Patent Appeals. Leave is granted.

    K.S

    9. Appeals allowed.

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    Comments

    Aziz Ahmad v. Alauddin Ahmad
    (Jul 12, 1933)