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Smart Summary

Structured Summary of the Opinion

Factual and Procedural Background

The defendants (appellants) were proprietors of a ten-biswas share in the zamindari of the village Gumanpur. By a sale-deed dated 22 September 1893 they purported to sell 4 biswas of that ten-biswas share to the plaintiffs. The deed purported to transfer not only the 4-biswas proprietary share but also 58 bighas 13 biswas of sir land (a portion of the village's 226 bighas 14 biswas of sir land), which was slightly more than the proportionate sir attributable to the 4-biswas share.

The sale-deed provided that:

  • The purchasers should be put into actual possession of the sir land;
  • The vendors would relinquish any ex-proprietary rights they might acquire in that sir land;
  • Out of the total consideration of Rs. 4,000, Rs. 1,500 would be deemed the consideration for transfer of the sir land and the agreement to relinquish ex-proprietary rights; and
  • If vendors failed to deliver possession of the sir land or to relinquish ex-proprietary rights, the vendees would be entitled to a refund of Rs. 1,500.

Possession of the sir land was not delivered. The plaintiffs sued for recovery of possession and alternatively for a refund of Rs. 1,500 with interest. The Court of first instance decreed in favour of the plaintiffs for the refund. The lower appellate Court affirmed that decree. The defendants appealed to this Court on the ground that the agreement underlying the plaintiffs' claim was contrary to law and therefore void.

Legal Issues Presented

  1. Whether the sale agreement (including transfer of sir land and the agreement to relinquish ex-proprietary rights with a refund clause) was contrary to law and therefore void.
  2. Whether, under section 7 of Act No. XII of 1881, an ex-proprietary right of occupancy arises in favour of a person who loses or parts with only a portion of his proprietary rights in a mahal, or only when he loses or parts with all his proprietary rights.

Arguments of the Parties

Appellants' (Defendants') Arguments

  • The defendants contended that the agreement upon which the plaintiffs base their claim is contrary to law and therefore void.
  • Implicitly, the defendants' position required arguing that by selling part of their proprietary rights they could not thereby be deprived of ex-proprietary rights under s. 7 of Act No. XII of 1881 (i.e., that s. 7 does not apply when only a part of proprietary rights is parted with).

Plaintiffs' Position (as reflected in the pleading and decree below)

  • The plaintiffs relied on the sale-deed provisions entitling them to possession of the specified sir land and to a Rs. 1,500 portion of the consideration being deemed for that transfer and for relinquishment of ex-proprietary rights; and, on non-delivery of possession (or non-relinquishment), the deed entitled them to a refund of Rs. 1,500.
  • The courts below granted relief to the plaintiffs in the form of refund of Rs. 1,500 (the plaintiffs' alternative claim was for possession, which had not been achieved).

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Bhikham Singh v. Har Prasad Held that where a zamindar sells his zamindari rights and includes in the sale the right to cultivatory possession of sir land and agrees to relinquish ex-proprietary rights, the vendee, if possession is not delivered or ex-proprietary rights not relinquished, is not entitled to claim a refund of the sale price or any portion thereof. Banerji, J. stated adherence to this ruling as a correct principle regarding entitlement to refund; this precedent informed the Judge's initial stance on the validity of the contractual refund provision.
Bhawani Prasad v. Ghulam Muhammad (Division Bench) Interpreted s. 7 of Act No. XII of 1881 as not requiring the proprietor to lose or part with all his proprietary rights; s. 7 could operate where only part of proprietary rights is parted with. The Court (Banerji, Knox and Aikman JJ) followed this Division Bench decision: the judges accepted that s. 7 may apply when only part of proprietary rights are parted with, and relied on that construction to hold the sale agreement void as defeating the statutory policy.
Ruling of the Board of Revenue (Selected Decisions of the Board of Revenue for 1888–1891, p. 8) Held a contrary view that the right under s. 7 does not arise until the person loses or parts with the whole of his proprietary rights in the mahal. The Court rejected the Board of Revenue ruling as contrary to the Division Bench decision and to the construction the Court applied; Banerji, J. explicitly stated he was unable to follow the Board's conclusions.

Court's Reasoning and Analysis

The Court's reasoning was delivered seriatim by three judges (Banerji, Knox and Aikman JJ). The essential analytical steps taken by the Court were:

  1. Assessment of the sale-deed and remedy claimed: The sale-deed attempted to transfer both a 4-biswas proprietary share and a specific quantity of sir land slightly in excess of the purchaser's proportionate sir; it allocated Rs. 1,500 of the Rs. 4,000 consideration to the sir land and agreement to relinquish ex-proprietary rights, with a contractual refund clause if possession or relinquishment did not occur. The plaintiffs sought possession and alternatively the Rs. 1,500 refund; lower courts granted the refund.
  2. Preliminary rule from Bhikham Singh v. Har Prasad: Banerji, J. affirmed the principle from Bhikham Singh that a vendee in such circumstances is not entitled to a refund of price if possession of sir land is not delivered or ex-proprietary rights are not relinquished. Banerji maintained adherence to that precedent.
  3. Central statutory construction of s. 7, Act No. XII of 1881: The decisive legal question was whether s. 7 contemplates ex-proprietary rights arising only when all proprietary rights are parted with, or also when only a portion is parted with. The Court adhered to the Division Bench decision in Bhawani Prasad v. Ghulam Muhammad that s. 7 can operate where only part of the proprietary rights have been parted with. Banerji, J. reasoned that a narrower reading (requiring loss of all proprietary rights) would defeat legislative purpose and enable evasion, and that the language of s. 7 is sufficiently wide to include part of the proprietary rights and a proportionate part of sir land.
  4. Response to the Board of Revenue's contrary view: Banerji, J. acknowledged a Board of Revenue ruling taking the opposite view but expressed inability to follow it; he relied on principles of statutory construction to adopt the Division Bench's interpretation that effectuates legislative intent.
  5. Concurring reservations and stare decisis: Knox, J. concurred with hesitation, doubting whether the strained construction placed on the statutory words could be borne by their literal meaning, but felt bound by precedent and the need to avoid enabling widespread evasions. Aikman, J. analysed the grammatical difficulty that the Division Bench's construction requires reading the section as producing a proportionate right of occupancy, which he thought was tantamount to adding words to the statute; nevertheless he declined to depart from the earlier Division Bench decision because the contrary construction would defeat the statute's object and enable evasions.
  6. Conclusion of analysis: Because the sale agreement had the effect (in the Court's view) of defeating the policy embodied in s. 7 as the Court interpreted it, the agreement was void and the plaintiffs' remedy based on it could not be sustained. Accordingly, the plaintiffs' suit should have been dismissed.

Holding and Implications

Holding: The Court ordered that the appeal be allowed, the judgment and decree of the lower appellate Court be set aside, and the plaintiffs' suit be dismissed. The dismissal was ordered without costs.

Implications (direct effects on the parties):

  • The decree in favour of the plaintiffs for a refund (Rs. 1,500) granted by the courts below was set aside and the plaintiffs' suit dismissed.
  • The Court applied and adhered to the Division Bench construction in Bhawani Prasad v. Ghulam Muhammad that s. 7 of Act No. XII of 1881 can operate where only part of proprietary rights are parted with, and rejected the contrary Board of Revenue ruling.
  • No order for costs was made (the suit was dismissed but without costs), reflecting the Court's directions regarding conduct and the fact that the defendants had not raised their plea below.

The opinion is narrowly confined to these factual circumstances and statutory construction issues; it does not purport to establish a wider rule beyond the construction of s. 7 in the context of the facts before the Court and the precedents relied upon.

Order: Appeal decreed. Judgment and decree of the lower appellate Court are set aside and the plaintiffs' suit is dismissed, without costs.

    Murlidhar v. Pem Raj

    Banerji, J.:— The appellants, who were defendants in the Court of first instance, held a ten-bis was share in the zamindari of the village Gumanpur. They sold four biswas out of the said 10 biswas to the plaintiffs on the 22nd September 1893. By that sale-deed the defendants purported to convey to the plaintiffs not only a 4-biswas share of the zamindari, but also 58 bighas 13 biswas of sir land. This quantity of sir land is a portion of 226 bighas 14 biswas of sir land appertaining to the whole village, and is slightly in excess of what would be the sir of the defendants proportionately to the 4-biswas share sold by them. The sale-deed provided that the purchasers should be put into actual possession of the sir land, and the vendors should relinquish such ex proprietary rights as they might acquire therein. It was also stated in the sale-deed that out of Rs. 4,000, the amount of consideration for the sale, Rs. 1,500 should be deemed to be the consideration for the transfer of the sir land and the agreement to relinquish exproprietary rights. The sale-deed further provided that in the event of the vendors failing to deliver possession of the sir land to the purchasers, or of their not relinquishing their exproprietary rights, the vendees would be entitled to a refund of the aforesaid sum of Rs. 1,500. Possession not having been delivered over the sir land, the present suit was brought for recovery of possession, and, in the alternative, for a refund of Rs. 1,500 with interest. The Court of first instance made a decree in favour of the plaintiffs for the refund of the amount stated above. That decision has been affirmed by the lower appellate Court. The defendants have preferred this appeal on the ground that the agreement upon which the plaintiffs have based their claim is contrary to law and is therefore void. It was held in Bhikham Singh v. Har Prasad that if a zamindar sells his zamindari rights and includes in the sale the right to cultivatory [209] possession of the sir land and agrees to relinquish his exproprietary rights in respect of the sir land, the vendee, in the event of such possession not being delivered or exproprietary rights not being relinquished, is not entitled to claim a refund of the sale price or any portion thereof. To this view I still adhere. The only other question which has to be considered to this case, therefore, is whether, by selling a part of their proprietary rights in the village in question, the defendants could acquire ex-proprietary rights in respect of their sir land under s. 7 of Act No. XII of 1881. The decision of that question depends upon the construction to be placed on the provisions of s. 7. Does that section contemplate that exproprietary rights would accrue in favour of a person losing or parting with his proprietary rights only when he loses or parts with all his proprietary rights or that he would acquire such rights even when he parts with or loses a portion of his proprietary rights? This question was answered by a Division Bench of this Court in the case of Bhawani Prasad v. Ghulam Muhammad. In that case it was held that in order that the provisions of s. 7 may come into operation, it is not necessary that the zamindar should lose or part with his proprietary rights in respect of the whole of his interest in the mabal. With that decision I am fully in accord. The language of s. 7 is no doubt not so clear as it should have been; but having regard to the policy of that section any construction other than that placed on it in the ruling referred to above would evidently defeat the object of the section and enable a proprietor to divest himself of his sir lands by excluding from sale an infinitesimal portion of his proprietary rights. The reasons for holding that the section does not contemplate the transfer or loss of all proprietary rights are fully stated in that judgment, and I have nothing to add to those reasons. There is, it is true, a ruling of the Board of Revenue, reported in the Selected Decisions of the Board of Revenue for 1888–1891, at page 8, in which a contrary view was held, but I am unable to follow the conclusions arrived at in that ruling. According to well-known rules of construction it is our duty to place on the section such a construction as would effectuate the intention of the Legislature, [210] provided that the language of the section can admit of the construction. I hold that the language of s. 7 is sufficiently wide to justify us in construing it in the manner in which it was construed in Bhawani Prasad v. Ghulam Muhammad. If the words “proprietary rights” in s. 7 may, as I hold they do, include a part of the proprietary rights, the subsequent words “land held by him as sir” can be equally held to include a proportionate part of the sir land. In this view as the agreement upon which the plaintiff's have based their claim would have the effect of defeating the law as I understand it, it is a void agreement and cannot be given effect to. The plaintiffs' suit should therefore have been dismissed. I would allows the appeal, set aside the decrees of the Courts below and dismiss the suit; but having regard to the conduct of the defendants and to the fact that the plea which has been taken in this Court was never raised in the Court below, I would make no order as to the costs of the litigation.

    Knox, J.:— I follow my learned brother, but with extreme hesitation. If the question was res integra and if the precedent, Bhawani Prasad v. Ghulam Muhammad, did not stand as a reported decision of this Court, I should have been very much inclined to hold otherwise. The interpretation now placed seems to me to put such a strain upon the words of the section as they stand that I doubt whether they can bear it. We have had abundant evidence that the language of this particular Act is in many cases, to say the least of it, very inartistic, and it may be that the interpretation which we now put is one within the spirit and policy aimed at by the Legislature when they enacted this section.

    Aikman, J.:— The decision of this appeal turns upon the construction of the opening words of s. 7 of Act No. XII of 1881. These words are as follows:—“Every person who may hereafter lose or part with his proprietary rights in any mahal shall have a right of occupancy in the land held by him as sir in such mahal at the date of such loss or parting” at a rate of rent such as is specified in the section. The Board of Revenue for these provinces held that the right thus created did not arise until the person claiming it lost or parted with the whole of his proprietary rights [211] in the mahal. In the case of Bhawani Prasad v. Ghulam Muhammad a Division Bench of this Court pointed out that if this was the meaning to be attributed to the words of the section, the object of the Legislature would be easily defeated. This is undoubtedly true. I think it is possible to construe the words “his proprietary rights” as meaning the whole or part of his proprietary rights; but there remains the passage in the section “shall have a right of occupancy in the land held by him as sir in such mahal at the date of such loss or parting.” The learned Judges who decided the case just referred to do not consider what meaning would have to be put on those words if an exproprietary right arises when a zamindar parts with a portion only of his proprietary rights. I scarcely think that the learned Judges would have held that if a zamindar parted with a mere portion of his proprietary rights he would thereby at once become an exproprietary tenant of the whole of the sir land which he had held in the mahal, and yet that is the apparent meaning of the words used by the Legislature. To carry out the view of the Division Bench to its logical conclusion, we should have to read the section as if it ran “shall have a right of occupancy in such portion of the land held by him as sir in such mahal as is proportionate to the proprietary interests he has lost or parted with.” This seems to me to trench dangerously on legislation. But in view of the consideration that the construction put upon the section by the Board of Revenue would result—to use the words of the learned Judges who decided the case of Bhawani Prasad v. Ghulam Muhammad in opening a door through which it would be possible for evasions of the law to become general in these provinces, I do not wish to depart from the principle stare decisis, and I concur in the order proposed.

    By the court.— The order of the Court is that the appeal is allowed, the judgment and decree of the lower appellate Court are set aside, and the suit of the plaintiffs is dismissed, but without costs.

    Appeal decreed.

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    Murlidhar v. Pem Raj
    (Dec 20, 1899)