Shrikishanlal And Others v. Ramnath Jankiprasad Ahir And Others

1. This is an appeal from the decision of Niyogi, J. confirming the decision of the first appellate Court. The predecessor of the appellants leased an orchard held in malik makbuza right to the predecessor of the respondents in perpetuity at a rent of Rs. 60. The lease provided for ejectment on default of payment of rent. The rent being in default, the plaintiff sued for possession. A decree was given by the trial Court. In the appellate Court all arrears were paid, and the first appellate Court relieved against forfeiture on further payment of interest and costs. Niyogi, J. held in second appeal that the principles of Section 114 of the Transfer of Property Act, could be applied to agricultural leases, that the first appellate Court was competent to relieve against forfeiture, and that the discretion of the first appellate Court had not been improperly exercised. In appeal it is contended that the principles enunciated in Section 114 of the Transfer of Property Act, cannot be applied, that if they are applied the arrears of rent must be deposited in the Court of first instance, and that the discretion of the Court was wrongly exercised.

2. As to the first point, it is argued that Section 38 of the Tenancy Act, precludes the application of equitable principles.

3. The material part of S. 38 is as follows:

“Except as otherwise provided for in this Act, a sub-tenant shall hold on such terms as may be agreed upon between him and his landlord.”

4. We do not consider that the fact that the incidents of tenancy are governed by contract prevents a Court of justice from applying equitable principles in regard to its enforcement. It is for example well established that an agricultural tenant is entitled to reasonable notice: vide, 60 Cal. 7711 and 7 Pat. 496.2 In 15 Mad. 125,3 it was held that a condition in an agricultural lease, to which the Transfer of Property Act did not apply, providing that the landlord might re-enter on non-payment of rent, was penal and would be relieved against, apart from the provisions of the Transfer of Property Act. In 18 N.L.J 159,4 it was held that principles of equity could be applied in matters relating to agricultural leases. In 14 N.L.R 188,5 the principles of Section 108(j) of the Transfer of Property Act, were applied to an agricultural lease, though the appellant seeks to distinguish this case on the ground that S. 108(j) itself can only apply in the absence of a contract to the contrary. In A.I.R 1927 Mad. 239,6 it was held that the Court had power to relieve against forfeiture independently of S. 114, and that where the lease did not come within the purview of the Transfer of Property Act, the Court exercising the power which it had possessed even previous to that Act, would relieve against forfeiture for non-payment of rent on such conditions as might appear equitable on the facts of each particular case, but was not bound by the conditions laid down in S. 114 if the Court granted the relief against forfeiture. In 42 Mad. 654,7 it was held that the principles of equity embodied in Section 111(g) of the Transfer of Property Act, applied to the case, and a distinction was drawn between the power to relieve against stipulations made to secure repayment of money and stipulations made for re-entry on other breaches of covenant, and it was pointed out that the latter stipulations were not considered stipulations by way of penalty. Niyogi, J. has reproduced the reasons given in that decision why the sections in the Transfer of Property Act were not made applicable proprio vigore to agricultural leases, and has approved the view that in the absence of such reasons there is no ground for applying different rules in the case of agricultural leases. The case in 25 N.L.R 1198 cited by the learned counsel for the appellants is not to the point. That was a case of execution of a decree for arrears of rent by ejectment, obviously governed by the special provisions of the Central Provinces Tenancy Act. Indeed, there is nothing that we can usefully add to the decision of Niyogi, J., and we have no doubt that though Section 114 of the Transfer of Property Act, does not apply in terms to agricultural leases, the Court has power to relieve against forfeiture.

5. The next argument repelled by Niyogi, J. is that the arrears of rent must be deposited in Court at the first hearing of the suit. Niyogi, J. has relied on the decision in 23 M.L.J 7159 which was followed in 25 M.L.J 486.10 The first case, however, was a case where two Courts below had decided that no forfeiture had been incurred and it was when the second appellate Court reversed this decision that it relieved against the forfeiture. This fact was not noticed in the next Madras case. The point is one not without difficulty because if no attempt is made in the trial Court to obtain relief against forfeiture by paying money into Court and a decree for ejectment is therefore given, it may be difficult for an appellate Court to say that the decree of the trial Court is wrong, and we think that in many cases money not offered at the time of the trial should not be received to relieve forfeiture in appeal, the more especially when the case has been fought out on other grounds such as denial of the plaintiff's right to sue. Nevertheless, the hearing of the suit does continue throughout the stage of appeal. It is the appellate Court's decree which supersedes the decree of the trial Court, and we are not prepared to say that an appellate Court has no power under Section 114 of the Transfer of Property Act, to grant relief against forfeiture. Much less are we prepared to say that when S. 114 does not apply in its terms to the case, an appellate Court is precluded from granting relief against forfeiture for non-payment of rent if on a consideration of all the facts it considers it to be equitable.

6. These facts have been clearly analysed by Niyogi, J. in his judgment. It is noticeable that on 26th August 1930 the predecessors of the plaintiffs wrote a letter in the following terms:

“What we have written in our notice dated 27th June of year 1930 are all correct and true. No doubt your client Jankiprasad Ahir has got a patta (deed of lease) in respect of the said land. But that (patta) remained binding so long as he continued complying with the terms laid down therein and when the conditions thereof were not acted upon, that (patta) was deemed to be cancelled and these proceedings were taken up. No man of Janki came to our place up till 15th June 1930 with jama (rent) nor did he (i.e, Janki) make payment of rent for two years. Then he sent a money order in the end of June 1930. But as he had not paid kists for two years in the month of Aghan and as he had stopped grazing the she-bufffalos that is, as he had committed breach of both the conditions, we gave the notice (to him) for ejectment and returned the money order.”

7. It is evident that the respondents' predecessor was endeavouring to pay rent in 1930 and was also endeavouring to pay the rent in 1931 after this letter, and that the rent of two years had been, according to the plaintiff, in default. We fully agree with Niyogi, J. that after the plaintiff was refusing to receive rent it was useless for the respondents to tender any more. The first letter written to the defendants in June 1930 is not on record, and all that is said in evidence is:

“They broke the conditions of the lease. A notice was sent on which a money order was received. I refused to accept the remittance unless the whole arrears were paid.”

8. But the letter dated 26th August 1930 suggests that all arrears were tendered in June 1930. We fully support the view of Niyogi, J. that this was a fit case to relieve against forfeiture, and dismiss the appeal with costs. Pleader's fee Rs. 50 for either side.

9. Appeal dismissed.