1. The question in this appeal is whether the defendant-appellant is estopped from questioning the title of the plaintiff-respondent, as both the lower Courts have held.
2. The title originally vested in three brothers one of whom, Chandulal, became insolvent. Prior to the insolvency the brothers had let the appellant into possession as a tenant. After the insolvency of Chandulal the three brothers passed a mortgage in favour of the plaintiff-respondent, and the appellant thereafter attorned to the respondent and paid him rent. The appellant brought the present suit in ejectment, the respondent set up an oral tenancy for the period in suit. Both the lower Courts held it not proved, but did not allow him to lead evidence questioning the respondent's title, on the ground that he was estopped. The defendant appeals.
3. It is argued for the appellant that he is not estopped on two , grounds, firstly, because the mortgage by an insolvent was illegal under Section 28 of the Provincial Insolvency Act and the taint of that illegality extends to the rent-note obtained by the mortgagee-respondent in his own favour; secondly, because the appellant was not let into possession by the mortgagee, but had already been in possession under the mortgagors. In support of the first proposition reliance is placed on the decisions of this Court in Laxmanlal v. Mulshankar : (1908)10BOMLR553 and Bhavan Lallu v. Umar Mahomed (1926) 29 Bom. L.R. 97, I.L.R. 51 Bom. 43. On the second point, the authority of Lal Mahomed v. Kallanus ILR (1885) Cal. 519 is relied upon.
4. The arguments, in my opinion, fail on both the points. On the first point it is at least doubtful whether the insolvency of one mortgagor of an undivided one-third interest invalidates the mortgage of the other two-thirds part of the other mortgagors, who were not insolvents.
5. In regard to the two Bombay cases, viz., Laxmanlal v. Mulshanhar and Bhavan Lallu v. Umar Mahomed, the decision in both was expressly on the ground that the rent-note was part and parcel of the same transaction with the deed held void, as appears from the remarks of Batchelor J. in Laxmanlal v. Mulshankar, at page 557, that the sale-deed and the rent-note were part and parcel of on(c) single transaction, and the remarks and similar observations of Marten C. J. in Bhavan Lallu v. Umar Mahomed towards the end of page 99. Where the rent-note is part and parcel of the same transaction with, another admittedly forbidden by law, the rent-note necessarily falls with the other illegal transaction. It may be that if the mortgagors had continued the tenancy under the mortgage, they might not be estopped from questioning the mortgage. Here, however, the appellant is not the mortgagor and his rent-note is separate from and independent of the mortgage and the taint, if any, of the latter cannot extend to the former.
6. On the second point I agree with and am bound by the decision of the Division Bench in Shanhar v. Jagannath : AIR1928Bom265 ; on the question of the original tenancy, rather than on the decision in Lal Mahomed v. Kallanus ILR (1885) Cal. 519. With respect, it appears to me that the words 'continuance of the tenancy' in Section 116 of the Indian Evidence Act applies to the tenancy in question in the same suit in which the estoppel arises and not to any previous tenancy. In fact it was not necessary in law for the mortgagee formally to interrupt the possession of the tenant of the mortgagor and i re-instate him in possession in order to constitute him tenant of the mortgagee under a fresh rent-note and to cause estoppel to arise in a suit in ejectment by the mortgagee on the rent-note. I agree, therefore, with the judgment of Patkar J. in Shankar v. , where, even though the tenant was originally let into possession by the mortgagor from the time when he passed a fresh rent-note in favour of the mortgagee a new tenancy arose and he remained in possession under the mortgagee and did not continue in his former possession under the mortgagors. That former possession did not prevent estoppel from arising.
7. For these reasons the decision of the lower Courts is, in my opinion, correct and the appeal is dismissed with costs.