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Varupanda Seetharama Swamy and ors. Vs. Allam Ugra Narasimha Murthy - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtAndhra Pradesh High Court
Decided On
Case NumberSecond Appeal No. 345 of 1981
Judge
Reported inAIR1982AP454
ActsCode of Civil Procedure (CPC), 1908 - Sections 11 - Order 23, Rule 1; Transfer of Property Act, 1882 - Sections 105, 106, 107 and 117; Registration Act - Sections 17 and 49; Evidence Act - Sections 91
AppellantVarupanda Seetharama Swamy and ors.
RespondentAllam Ugra Narasimha Murthy
Appellant AdvocateM. Jagannadha Rao and ;E. Ella Reddy, Advs.
Respondent AdvocateK. Srikrishna, Adv.
Excerpt:
property - principle of res judicata - section 11 and order 23 rule 1 of code of civil procedure, 1908, sections 105, 106, 107 and 117 of transfer of property act, 1882, sections 17 and 49 of registration act and section 91 of indian evidence act, 1872 - whether there was any issue in earlier suit which was either directly or substantially in issue which has been subsequently raised in suit between same parties or between parties under whom they or any of them claim litigation under same title - format of case what becomes manifest is that in earlier suit for injunction claim founded on family arrangement was rejected - items of properties in two suits are different but claim was that they have fallen to share of plaintiff under family arrangement - merely because in later suit an.....1. the substantial questions of law which arise for determination in this second appeal are :(1) whether the judgment in an earlier suit field for permanent injunction wherein the plea of family arrangement and consequential partition of the properties thereof was rejected, would constitute res judicata in a later suit, also field for injunction, even though the final judgment in second appeal arising out of the earlier suit, reserved a right in favour of the plaintiff for establishing his rights and claims by filing a regular suit? (2) whether the lessee is a 'privy' to the lessor and the judgment against the lessor in an earlier suit filed by him for an injunction would bind the lessee in a later suit to which the lessor is not a party within the meaning of s. 11 of the civil p. c. 2......
Judgment:

1. The substantial questions of law which arise for determination in this second appeal are :

(1) Whether the judgment in an earlier suit field for permanent injunction wherein the plea of family arrangement and consequential partition of the properties thereof was rejected, would constitute res judicata in a later suit, also field for injunction, even though the final judgment in Second Appeal arising out of the earlier suit, reserved a right in favour of the plaintiff for establishing his rights and claims by filing a regular suit?

(2) Whether the lessee is a 'privy' to the lessor and the judgment against the lessor in an earlier suit filed by him for an injunction would bind the lessee in a later suit to which the lessor is not a party within the meaning of S. 11 of the Civil P. C.

2. Before answering the relevant format of the case may briefly be set out; Defendants 1 to 3 are the appellants herein. The sole plaintiff is the respondent. The plaintiff, Allam Ugra Narasimhamurthy, filed the suit alleging that his brother-in-law, V. Appala Suryanarayana, is the son of the late Butchaiah by his first wife, that the defendants 1 to 3 and one V. Maheswararao are the sons of the said Butchaiah by his second wife, that the said Butchaiah was the owner of the plaint schedule property and the other properties, that he executed a Will dated 2-12-1954 in respect of all his properties, that by virtue of the said Will, the two brothers of the said Butchaiah got half share in those properties; while his brother-in-law, Appala Suryanarayana, got 1/6th share, that after the death of the said Butchaiah, the two brothers took their half share in the properties, that his brother-in-law and defendants 1 to 3, their brother and mother lived jointly for some time, that his brother-in-law acquired some properties with his own earnings in his name as well as in the name of the 1st defendant benami, that because of some misunderstandings between his brother-in-law and the defendants, his brother-in-law agreed to part with some properties earned by him on the advice of the elders for the sake of family peace, that there was a family arrangement reduced to writing on 26-11-1968, that by virtue of the said family arrangement, the plaint schedule land and other properties fell to the share of his brother-in-law, that his brother-in-law was in exclusive possession and enjoyment of the plaint schedule land and other properties since then, that his brother-in-law leased out the plaint schedule land to him under an agreement dated 6-10-1976, that he is in possession and enjoyment of the same as a lessee of his brother-in-law, that the defendants 1 to 3 and their brother Maheswararao, who have been enjoying the properties that fell to their share, have been trying to disturb his possession of the plaint schedule land, that they also committed theft of the coconuts in the said land, that the value of the coconuts stolen away comes to Rs. 1406-90 ps. and that his possession, therefore, be protected by away of permanent injunction and damages in the sum of Rs. 1403-40 ps. be awarded towards the value of the coconuts.

3. The defendants averred that the plea of family arrangement is not true, that Butchaiah took his share in the properties left by his father after severance from his two brothers, and the said properties of their father, after his death, have been in joint possession and enjoyment of themselves, their brother Maheswararao and the plaintiff's brother-in-law, Appala Suryanarayana, that the plaintiff's brother-in-law, who is their step-brother, has been managing the said properties, that there was no partition of the said properties between themselves and their step-brother, that their step-brother is not in exclusive possession and enjoyment of the same, that the lease set up by the plaintiff is false and so the plaintiff is not entitled to the permanent injunction and the damages claimed.

5. Defendant No. 1 died during the pendency of the suit. No legal representatives were brought on record. So, the defendants 2 to 4 preferred the appeal.

6. The first appellate Court likewise confirmed the judgment and decree of the trial Court holding inter alia that as per Ext. A-7, which was the written statement filed on behalf of the defendants 1 and 2 herein as defendants 1 and 2 in O. S. 56/71 on the file of the District Munsif, Bheemunipatnam, there was partition between themselves and P. W. 2 herein Appala Suryanarayana, brother-in-law of the plaintiff herein, who was the plaintiff therein, that P. W. 2 took 1/8th share in the properties left by their father Butchaiah, that themselves took 6/8th share in the properties, that P. W. 2 has been in exclusive possession and enjoyment of his share while themselves have been in exclusive possession and enjoyment of their shares and that they have no interest in the subject-matter of the suit and therefore defendants 1 and 2 herein categorically admitted in a prior proceeding that there was partition of the properties between themselves and P. W. 2 and as the said admission binds them, it is not open to the defendants now to contend that there was no partition between themselves and P. W. 2, that under Ext. A9, lease agreement in favour of the plaintiff herein, the possession of the suit land was delivered in the year 1976 itself, that though it is an unregistered lease agreement in respect of the agricultural land for a period of three years and so requires registration, the same could be relied upon for purposes of proving the factum of possession and character of the lease; and that since the subject-matter of this suit is different from the subject-matter of the earlier suit and the claim made by the plaintiff is different from the nature of the claim made in the earlier suit, the judgment in the earlier suit would not operate as res judicata in this case.

7. Mr. M. Jagannadharao, the learned counsel for the appellants, contended that the judgment in the earlier suit would constitute res judicata notwithstanding the observations made by the final Court in the earlier proceedings in S. A. No. 551/79 holding that the plaintiff therein would be at liberty to establish his rights and claims by filing a regular title suit and also notwithstanding the fact that the present suit is filed by the lessee of the plaintiff in the earlier suit, as the present plaintiff would be privy by virtue of the lease.

8. Before making the analysis of the arguments advanced, it may be stated that the earlier suit filed for injunction was in respect of item-10 in the schedule annexed thereto, which suit as was stated earlier, stood eventually dismissed. The final judgment, however, in the Second Appeal 551 of 1979 was rendered on 1-4-1980; whereas the decision in this suit by the trial Court was delivered on 31-3-1979 holding that the family arrangement has been held established and item-3 stood allotted to the defendants and decreed the suit granting injunction against the defendants in respect of the coconut tope.

9. The following decisions are relied upon by the learned counsel for the appellants :

In Pittapur Raja v. Buchi Sitayya, (1884) ILR 8 Mad at p. 219, the Madras High Court* held : 'A competent Court having decided upon an issue directly raised in a suit brought by a person alleging himself to have been adopted, that this adoption had not taken place, it was held, that the present suit was barred under Act X of 1877, S. 13, as res judicata, having been brought by the son of the defendant in the former suit, claiming through his father, to establish the same adoption; and that the section applied. The establishment of the adoption alleged in the first suit would have obliged the father of the present plaintiff to share with the adopted son his ancestral estate. That adoption having been negatived, the son, in this suit, ought to be estopped from making title on the ground that the adoption had placed the person, from whom be claimed to inherit, in the relation of father's brother to him.'

The Karnataka High Court in Mahalingeswara Devaru v. Seetharama Bhatta, : AIR1978Kant213 observed:

'The primary test of res judicata depends upon the identity of title in the two litigations and not the identity of the actual property involved in the two cases. Therefore, even if the property involved in the previous suit was different, that cannot be an impediment to invoke the principles of res judicata. The plea of res judicata could also be established on the record of the judgment and decree in the previous suit, and not necessarily on the production of the pleadings.'

It further observed :

'The principle of res judicata is not affected by a subsequent contrary view taken by a superior Court in any other case. A wrong decision by a Court having jurisdiction is as much binding between the parties as a right one and may be superseded only by appeals to higher Tribunals or other procedure like review which the law provides. Therefore, even if a decision happens to be wrong in view of the later judgment of the High Court, it is binding between the parties and its legal effect remains the same whether the reason for the decision was sound or not.'

In Abdul Gani v. Nabendra Kishore, AIR 1930 Cal 47, the Calcutta High Court while interpreting the impact of the words 'matter in issue' pertaining to S. 11 of the Civil P. C. held :

' 'Matter in issue' in S. 11 of the Code is distinct from the subject-matter and the object of the suit as well as from the relief that may be asked for in it and the cause of action on which it is based, and the rule of res judicata requiring the identity of the matter in issue will apply even when the subject-matter, the object, the relief and the cause of action are different. It is the matter in issue and not the subject-matter of the suit that forms the essential test of res judicata'.

The following case law has been cited in regard to the effect of the observation made by the Court while dismissing the suit reserving a right in favour of the plaintiff to bring a fresh suit.

10. In Fateh Singh v. Jagannath, AIR 1925 PC 55, the Privy Council held :

'Where a Court in dismissing of suit made a remark that the plaintiffs were at liberty to file a fresh suit, but there was no formal application under O. 23, R. 1 for withdrawal.

The remark does not amount to a permission to bring a fresh suit under O. 23, R. 1.' The Madras High Court in Palani Goundan v. Suppiah Goundan, AIR 1925 Mad 1162, held :

'A suit by a reversioner during the lifetime of the widow is a representative one and ensures for the benefit of all the reversioners and is equally operative to the detriment of all.'

It further held:

'Where a previous suit by a presumptive reversioner for declaration that a mortgage by widow was not binding on the reversionary heirs was dismissed, on refusal of his prayer to withdraw the suit with permission to bring a fresh suit, with the following remarks: 'After all this suit is only for a declaration and there is no hardship for the plaintiffs-reversioners if no permission to bring a fresh suit for declaration is granted; for they could after the widow's death bring a suit for possession, contesting also the present alienations.

That the question of the reversionary right of the reversioner had become res judicata notwithstanding the remarks of the Judge in the order of dismissal.'

In Alamelu Ammal v. Ramaiyer (A. T. K. P. L. M. Muthiah Chetti v. Palaniappa Chetti), AIR 1922 Mad 447, it was observed;

'Permission to withdraw suit does not imply recognition of maintainability of a suit nor has Court power to provide to that effect in the order.'

The Madras High Court in Krishnaswami v. Manikka, AIR 1931 Mad 268 held :

That the subsequent suit is not maintainable. Even if the plaintiff had alternative claims arising out of the same cause of action, he might and ought to have set up his alternative claims.'

In Ganesh v. Baidyanath, : AIR1958Pat270 , the Patna High Court observed:

'Where in a previous title suit, an issue was framed on the point whether the sale deed was genuine and for consideration and for legal necessity, but the suit was dismissed on the ground that the sale deed was collusive and without consideration and the Court did not go into the question of legal necessity, because the Judge wrongly thought that the question could not be gone into because all the reversioners had not been impleaded in the suit:

That in spite of this observation of the Court the question of legal necessity must be deemed to have been impliedly decided against the plaintiff in the previous suit and, therefore, the question was barred by the principle of constructive res judicata in the subsequent suit.'

The Rajasthan High Court in Maharama v. Ram Bux, AIR 1978 Raj 206, held:

'The power of the Court to allow the plaintiff to withdraw the suit with liberty to file a fresh suit as contained in O. 23, R. 1 is not absolute. It can only be exercised when an application in this regard is made by the plaintiff and the Court is satisfied that the suit must fail by reason of some format defect or that there were sufficient grounds for allowing the plaintiff to institute a fresh suit for the subject matter of a suit or part of a claim.

Where an application for permission to withdraw suit and file fresh one is not on record, the fact that the judgment of the Court contains a direction to that effect will not amount to a permission to bring a fresh suit under O. 23, R. 1 nor could it be inferred that the Court was alive with the grounds contained in this Rule while granting such a permission.'

It further held:

'That the finding in previous suit that it was premature could not considered to be a decision on a preliminary issue so as to render the finding on the other issues, merely obiter or surplusage. The Court could not be deemed to have decided earlier suit on the ground that it was premature only, for in that case it would not have given finding on merit on all other issues. Therefore fresh suit was not maintainable being barred by res judicata.'

In Vyankatesh v. Krishna, AIR 1931 Bom 417, it was held :

'That the permission which the defendants-tenants sought could not be given to reserve the only question in the suit. It was a permission which they could not apply on the most elementary principles of judicial decision and which the Court could not give, and the permission purporting to be granted in appeal cannot save the present suit from being res judicata.'

In Robert Watson & Co. v. Collector of Rajshahye, (1869-70) 13 Moo Ind App at page 160, the Privy Council held :

'There is no power in the Courts in India, similar to that exercised by the Courts of Equity or Common Law in England, to dismiss a suit with liberty for the plaintiff to bring a fresh suit for the same matter, or to enter a non-suit. Such power of the Indian Courts is limited to questions of form, as in the case (1) of misjoinder of parties, or of the matters in suit, (2) where a material document has been rejected for not having a proper stamp, and (3) if there has been an improper valuation of the subject matters of the suit; but not to a case where the issue has been joined, and the plaintiff fails to produce the evidence he is bound to give to support the issue.'

The decision in Sinha Subba Goundan v. Rangai Goundan, AIR 1946 Mad 141 and in Malaya Kumar v. Fakir Mohammad. AIR 1947 Cal 393, cited by the learned counsel for the appellants are also to the same effect as that of the decision in Robert Watson & Co. v. Collector of Rajshahya (supra).

11. The decisions on which the learned counsel for the respondent placed reliance are:

In Syed Mohd. S. Labbai v. Mohd. Hanifa, : [1976]3SCR721 , the Supreme Court held (Para 7) : 'Before a plea of res judicata can be given effect, the following conditions must be proved - (1) that the litigating parties must be the same; (2) that the subject matter of the suit also must be identical; (3) that the matter must be finally decided between the parties; and (4) that the suit must be decided by a Court of competent jurisdication.'

The Karnataka High Court in Shankaralingappa v. Nanje Gowda, : AIR1981Kant78 held :

'A judgment in a suit for injunction is not a judgment in rem and binds only the parties to the suit. Broadly 'privies' are of three kinds, viz., (i) 'privies' in blood; (ii) 'privies' in estate and (iii) ..........'

The Court further held :

'The suit filed by Kalaiah as also the suit filed by the plaintiff are not for declaration of title or their ownership. Both the suits are simple suits for permanent injunctions. A decree for permanent injunction does not prohibit the defendant from instituting a suit for declaration of his title and for recovery of possession from the very decree holder that has obtained a decree for permanent injunction. On the legal principles that distinguish ownership and possession, it is difficult to hold that a transferee is a 'privy' in estate and the decree made against his transferor operates as res judicata against him. A decree for permanent injunction obtained by one person against another person, cannot obviously bind all other persons and ignore the factual changes that take place with regard to possession. If that is not the position, then it ignores all legal and factual changes that take place and stamps that decree as if it is a convenant running with that land. With all the anxiety of law to safeguard possession, acceptance of such a proposition, would even defeat the very safeguards provided by law and would create innumerable problems in safeguarding possession. In this view also, the Court should be loath to accept the extreme proposition that the plaintiff, the transferee is a 'privy' in estate and the decree obtained by Kalaiab against Lingamma operates as res judicata against him ..... An injunction does not run with the land. An injunction only acts in personam or against a person. Both these principles are firmly established legal principles.'

It also held:

'The word 'privy' has different meanings in different contexts. Wharton's Law Lexicon defines the terms 'privy' and 'privies' thus:

(1) privies in blood, such as the heir to his ancestor, or between coparceners.

(2) privies in representation, as executors or administrators to their deceased testator or intestate.

(3) privies in estate, as grantor and grantee, lessor and lessee, assignor and assignee, etc...............'

In Raghurama Arya v. Bapanna Rao, : AIR1959AP448 , the Court held :

'There is no scope for extending the doctrine of res judicata to the instant case. The subject matter of the two suits as also the capacities in which they were brought are altogether different. The object of the first suit (instituted by the 4th defendant in the present suit, as plaintiff) was to obtain a declaration that the Will was a forged one whereas in the present one the purpose is to get legacy given under the Will. The are and scope of the previous litigation are different from those of the present one. The issue in the previous suit, viz., the right of the then plaintiff to a share in the partnership, was considered only as having a bearing on the right of the plaintiff to impugn the genuineness of the Will. That being the case it could not be said that the issues now arising in this case should be deemed to have been directly and substantially in issue in the earlier suit. It cannot also be ignored that the first suit was instituted by the 4th defendant in the capacity of one who had entered into partnership with the testator during his lifetime, while in the instant case the claim is as a legatee under the Will of the said testator. The cause of action also cannot be said to be the same to attract the applicability of the principle underlying Section 11, Civil P. C. It is necessary that the cause of action on which both the suits are based should be the same. This is not a case where the same transaction is sought to be established in two different modes.' On a conspectus of the case law cited above, the following could be said to emerge :-

(1) The primary test of res judicata depends upon the identity of title in the two litigations and not the identity of the actual property involved in the two cases;

(2) The principle of res judicata is not affected by a subsequent contrary view taken by a superior Court in any other case. A wrong decision by a Court having jurisdiction is as much binding between the parties as a right one and may be superseded only by appeals to higher Tribunals or other procedure like review which the law provides;

(3) 'Matter in issue' in S. 11 of the Code of Civil Procedure is distinct from the subject matter and the object of the suit as well as from the relief that may be asked for in it and the cause of action on which it is based, and the rule of res judicata requiring the identity of the matter in issue will apply even when the subject matter, the object, the relief and the cause of action are different. It is the 'matter in issue' and not the subject matter of the suit that forms the essential test of res judicata;

(4) A remark by a Court in dismissing of a suit that the plaintiffs are at liberty to file a fresh suit without there being any formal application under O. 23, R. 1, will not amount to a permission to bring a fresh suit under O. 23, R. 1 of the Civil P. C.;

(5) Permission to withdraw suit does not imply recognition of maintainability of a suit nor has the Court power to provide to that effect in the order.

(6) Where in a previous title suit, one of the issues framed is left undecided wrongly holding that the issue could not be gone into because of certain infirmities and the suit is dismissed, the question with regard to the same issue gets barred by constructive res judicata in a subsequent suit, as it is deemed to have been impliedly decided in a previous suit;

(7) The Courts in this country have no power unlike the Courts of Equity or Commea Law in England to dismiss a suit with liberty for the plaintiff to bring a fresh suit for the same matter, or to enter a non-suit. Such power of the Indian Courts is limited to questions of form, as in the matters in misjoinder of parties, or of the matters in suit, (2) where the material document has been rejected for not having a proper stamp, and (3) if there has been an improper valuation of the subject matter of the suit;

(8) The following must be proved for successfully raising a plea of res judicata;

(I) that the litigating parties must be the same or between the parties under whom they or any of them claim;

(ii) that the subject matter of the suit must also be identical;

(iii) that the matter must be finally decided between the parties; and

(iv) that the suit must be decided by a Court of competent jurisdiction;

(9) The lessees is a privy in estate and, therefore, a judgement against his lessor will be a bar in a later suit by the lessee in respect of the subject matter in issue.

12. Bearing in mind the principles aforementioned, it may now be examined whether the suit filed herein could be said to be barred by res judicata. Section 11, Civil P. G. reads:

'No Court shall try any suit or issue in which the matter directly and substantially in issue has been directly and substantially in issue in a former suit between the same parties, or between parties under whom they or any of them claim litigating under the same title, in a Court competent to try such a subsequent suit or the suit in which such issue has been subsequently raised, and has been heard and finally decided by such Court.'

The Question, therefore, predominantly and essentially is whether there was any issue in the earlier suit, which was either directly or substantially in issue which has been subsequently raised in a suit between the same parties or between the parties under whom they or any of them claim litigating under the same title. If we discern carefully, the format of the case what becomes manifest is that in the earlier suit for injunction the claim founded on family arrangement was rejected. The items of the properties in the two suits are different, but the claim was that they has fallen to the share if the plaintiff under the said family arrangement. Therefore, merely because in a later suit an injunction was sought for vis-a-vis a different item though admittedly traceable to the family arrangement, it cannot conceivably be held that the issue in the earlier suit is not, at any rate, substantially the same as the one in the later suit. The claim of 'Possession' in the earlier as well as in the later suit, is undoubedly based on the factum of 'family arrangement', and so, it is inescapable to conclude that there is commonness in the 'matter in issue' in the two suits. In my judgment therefore there is complete identity of the subject matter in both the suits. Hence, the claim which is sought to be set up in the later suit gets barred by res judicata. Before, however, so holding, one more ingredient which is sine qua non has to be established, viz., whether the litigation in both the suits has been between the same parties or between the parties under whom they or any of them set up the claim.

13. The learned counsel for the respondent's argument in respect of the lease under Ext. A-9 dated 6-10-1976 is two-fold. Firstly, the agreement should be construed as only a licence and not the lease, as the bare reading of it shows that no agricultural operation whatsoever was required to be done during the entire term of the agreement. It is merely an act of collecting the fructus like gathering of coconuts and so on and therefore, the entire period of agreement will be in subsistence without any break and so the rights will be intact throughout the said period and if that be so, the principle of lessee being privy in judgement in the earlier suit cannot operate as res judicata against the plaintiff in this suit, who is a mere licensee. Secondly, even assuming that the agreement is a lease for agricultural land, though unregistered, yet the principle under S. 106 of the T. P. Act cannot be attracted, as it is not applicable to the buildings and, therefore, the lease cannot be reckoned as from month to month and if that be so, the plaintiff-respondent is not bound by the principle of res judicata.

14. The counter argument of the learned counsel for the appellants is that it is quite apparent from a mere reading of Ext. A-9 that it is for agricultural purposes. The word used therein as ' Palasayam Agreement' would also indicate that it is for the purpose of agriculture. Secondly, since as per the provisions of Sec. 107 of the T. P. Act, lease of immovable property from year to year or exceeding one year requires registration and admittedly Ext. A-9 which is for a period of three years, but is not registered, is not a valid lease. However, the said agreement can be used for collateral purposes of establishing the nature of the possession and since admittedly the respondent is in possession by virtue of the said agreement, his lease is terminable by six months' notice within the meaning of Section 106 of the T. P. Act. The further argument is that such leases gets terminated either at the end of the month to month. In any view of the matter, the lease gets terminated either at the end of the therefore, since continuity is broken, a fresh lease will beamed to be commenced and, therefore, the plaintiff-respondent cannot take any shelter under Ext. A-9 and claim immunity from the bar of res judicata, as the said agreement cannot confer any heritable right.

15. The following case law cited by the learned counsel may now be examined:

In Krishna Nair V. Kambi, AIR 1937 Mad 544, it is held: 'A lessee is bound by a judgement against his lessor in the absence of any fraud or collusion on his part. A lawful judgment, therefore, which deprives the landlord of estate deprives the tenant of necessity of his subordinate right.

Where therefore in a suit for ejectment the lenient sets up the title of a third person to the leased property as against the Landlord suing him in ejectment and pending the second appeal from the decision in ejectment suit, a suit between the landlord and such third person decides that the landlord is entitled to leased property and not the third person. such decision is binding on the tenant even though he is not party to such suit and the tenant is concluded by the decision on title given in such judgment against the third person whose title he pleaded in the ejectment suit'. In Sivasubrahmania V. Theetrthapathi, AIR 1933 Mad 451, the Court held:

'Agricultural leases are excluded by Section 117. They can be made either orally or in writing though if in writing Sec. 17, Registration Act, requires that they should have been registered.'

The full Bench of the Patna High Court in Ram Nath Mandal v. Jojan Mandal, : AIR1964Pat1 held:

'Under Sec. 117 of the T. P. Act a lease for agricultural purposes is not necessary to be made by a written instrument. It may be effected by an oral agreement, and when so effected no registration is required, but if the transaction is reduced to writing, then, in the case of a lease from year to year on any term, exceeding a year or reserving a yearly rent, registration would be required under S. 17 of the Registration Act, and , if unregistered, the lease will be inadmissible in evidence under S. 49 of the Registration Act. and other evidence of its terms will be precluded under S. 91 of the Evidence Act.' In Ram Kumar v. Jagdish Chandra, : [1952]1SCR269 , the Supreme Court held: 'The section lays down a rule of construction which is to be applied when there is no period agreed upon between the parties. In such cases the duration has to be determined by reference to the object or purpose for which the tenancy is created. The rule of construction embodied in this section applies not only to express leases of uncertain duration but also to express leases implied by law which may be inferred from possession and acceptance of rent and other circumstances. It is conceded that in the case before us the tenancy was not for manufacturing or agricultural purposes. The object was to enable the lessee to build structures upon the land. In these circumstances, it could be regarded as a tenancy from month to month, unless there was a contract to the contrary. The question now is whether there was a contract to the contrary in the present case? Mr. Setalvad relies very strongly upon the fact that the rent paid here was an annual rent and he argues that from this fact it can fairly be inferred that the agreement between the parties was certainly not to create a monthly tenancy. It is not disputed that the contract to the contrary, as contemplated by S. 106, T. P. Act, need not be an express contract; it may be implied, but it certainly should be a valid contract. If it is no contract in law, the section will be operative and regulate the duration of the lease. It has not doubt been recognised in several cases that the mode in which a rent is expressed to be payable affords a presumption that the tenancy is of a character corresponding thereto. Consequently when the rent reserved is an annual rent, the presumption would arise that the tenancy was an annual tenanc unless there is something to rebut the resumption. But the difficulty in applying this rule to the present case arises from the fact that a tenancy from year to year or reserving a yearly rent can be made only by registered instrument as laid down in Section 107, T. P. Act. The Kabuliyat in the case before us is undoubtedly a registered instrument. but exconcesis it is not an operative document at all and cannot consequently fulfil the requirements of Section 107, T. P. Act.'

The Madras High Court in Bapayya v. Venkata Ratnam, : AIR1953Mad884 held:

'Under Section 117, T. P. Act the provisions as to notice contained in Section 106 are not 'proprio vigore' applicable to agricultural leases. It has been held in Krishna Setti v. Gilbert Pinto ( AIR 1919 Mad 12 (Y)) - that though Section 105 to 116 are not applicable as such to agricultural leases they would be binding as rules of justice, equity and good conscience.'

16. The respondent's counsel relied on a decision reported in Ugni v. Chowa Mahto, AIR 1968 Pat 302, wherein the Full Bench comprising five Kudges held (at p. 305):

' A valid agricultural lease may be created by registered instrument as pointed out in AIR 1948 Pat 446, and if such a registered document is created, delivery of possession is not necessary to prove the total of the lessee. If, however, the lease is not registered, and is, therefore inadmissible as evidence of title. It will always be open to the tenant concerned to show that he obtains raiyati interest on the strength or actual possession and acceptance of rent by the landlord.

There is no legal bar to a person claiming raiyati interest on two alternative pleas. He may claim such a right on the basis of a written document of lease. If however, such claim fails on the ground that the document being compulsorily registerble, was not registered, nevertheless his alternative claim based on actual possession, coupled with acceptance of rent by the landlord may sueceed. In that case, the unregistered lease will be admissible for the collateral purpose of proving the nature of possession.'

The Court further held:

'Section 91 only excludes other evidence of terms or a document but not of existence or the contract or the relationship of landlord and tenant brought about by possession and payment of rent.'

17. The emerging principles on the above conspectus are:

(1) A lawful judgment in the absence of any fraud or collusion against a lessor binds his lessee even though he is not a party to the judgment.

(2) Under Section 117 of the T. P. Act, a lease for agricultural purposes need not be in writing, but if effected in the case of a lease from year to year or any term exceeding a year, it requires registration under Section 17 of the Registration Act. If unregistered the lease will be inadmissible in evidence under Section 49 of the Registration Act, and other evidence of its terms will be precluded under Section 91 of the Evidance Act. However, it can be used for collateral purpose of proving the Possession;

(3) Under Section 117 of the T. P. Act the Provisions as to notice contained in S. 106 of the said Act are not 'peoprio vigore' applicable to agricultural leases, nonetheless they will be binding as rules of justice, equity and good conscience;

(4) A lessee can claim raiyati interest on the basis if valid lease which can be created under a written document which should be registered; and

(5) The tenancy of agricultural land from year to year or exceeding a year or reserving a yearly rent can be made only be a registered instrument as laid down in Section 107 of the T. P. Act. Such tenancy cannot be established by proving the actual possession any payment of yearly rent, as it does not fulfil the requirements of Section 107 of the T. P. Act.

18. Now it has to be adjudicated as to whether the transaction covered by Ex. A-9 is a lease or licence, as it as contended by the respondent's counsel that it should be construed only as 'licence' but not as 'lease'. The inspiration appears to have been derived from the word 'Palasayam Agreement'. But a careful reading of the entire document would undoubtedly reveal that the transaction is one of lease but not licence. The right conferred under the document is no doubt gathering of fructus from the said land, but is also involves the operation of agriculture. Even otherwise, garden cultivation for the purpose of procuring vegetables and fruit and food for man or beast and other products fit for human consumption by way of luxury if not as an article of diet, i.e., a betel garden, and also arboriculture such as casuarina plantation, have been termed as 'agriculture'. (Vide: Murugesa Chetti v. Chinnathambi, (1901) ILR 24 Mad 421 and Panadai Pathan v. Ramaswami, (1922) ILR 45 Mad 710 : (AIR 1922 Mad 351). Therefore, the contention that the document should be construed as licence and not lease is not acceptable,

19. Bearing in mind the above, the proposition raised herein can easily be answered. It is not in dispute that the written lease created under Ex. A-9 on 6-10-1976 for three years, is unregistered and therefore, it failed to fulfil the requirements of Section 107 of the T. P. Act and so it is fatal to the existence of it. However, the lease which exceeds one years is terminable by six months' notice and consequently the lease will not be a continuous lease from year to year. Therefore, though the lease commenced earlier to the institution of the previous suit, yet, since the continuity is broken and the final decision in the previous suit came to be pronounced in the Second Appeal No. 551 of 1979 on 1-4-1980, the said judgment which was against the lessor, will equally be binding on the lessee. Consequently, the later suit filed by the lessee is barred by res judicata.

20. The learned counsel for the respondent argued that the plaintiff in this case is admittedly a lessee from the plaintiff in the earlier suit and the said lessee was not at all a party to the earlier suit and, therefore, since the earlier suit being only a suit for injunctions simpliciter, which necessarily depends upon the factum of possession and is capable of changing positions from time to time, the lessee is not bound by the principle of res judicata. The counter argument of the learned counsel for the appellants is that the lesssee is a 'privy' in estate to the lessor and though the lease was entered into on 6-10-1976, which was long before the final adjudication in the earlier suit in the Second Appeal No. 551 of 1979, viz., on 1-4-1980, nevertheless the lease as per the agreement is though for a period of three years and since it is not registered, it becomes a month to month lease and consequently the lessee, who is the plaintiff in this case, is bound by the judgment against the lessor the plaintiff in the earlier suit. (Vide the following)

21. In Md. Azizul Haque v. Debendra Kumar, AIR 1959 Assam 57, the Assam High Court held:

'Where a lease for five years is invalid and inoperative, the tenancy that is created by legal implication would only be a monthly tenancy under Section 106, the lease be for residential purposes and not for purpose of manufacture or agriculture. The document may be used for the collateral purpose of showing the defendant came to occupy the property as a tenant. But the term of years came into existence in legal contemplation. The tenancy from the beginning was a monthly tenancy under section 10. It came into existence by implication of law

22. In Surya Kumar v. Trilochan Nat : AIR1955Cal495 , the Calcutta High Court observed:

'Though a yearly rent is reserved, if the is no registered document as is required such a case, under Section 107, it must held that though the intention may have been no create a lease from year to year, that intention was not expressed in proper legal form and so it cannot be given effect to the Courts must proceed on the basis that there is no valid agreement between the parties and consequently the rights of parties will be regulated by law as provided Section 106 as if no agreement existed all.'

(The tenancy in the case was held to be one from month to month and terminable by fifteen days' notice').

23. In Krishnan Nair v. Kambi (AIR 1937 Mad 544) (supra), the Madras High Court observed:

'The doctrine of res judicata so far it relates to prohibiting the retrial or an issue, must refer not to the date of the commencement of the litigation, but to the time when the Judge is called upon to decide the issue. The rule of res judicata is not limited to the Court of first instance but at applies equally to the procedure of the first and second appellate Courts and indeed even to miscellaneous proceedings.'

24. What is clear from the above cited case law is that a lessee is a 'privy' in estate and any decision against his lessor in an earlier suit will bind the lessee was not a party to the earlier suit not the lessor is a party to the later suit and also, even if the said lease commenced prior to the finality of the judgment in the earlier suit, provided, however, the lease is from month to month. In this case, since it is conceded that the lease is unregistered it will be one from month to month, and though the lease was at first brought into being pending the finality of the proceedings in the earlier suit, viz., 6-10-1976, it cannot confer any right much less heritage right, the lease being invalid, on the lessee to claim that he is not bound by the judgment in the earlier suit, he being a 'privy' in estate to the lessor.

25. There is yet another aspect which is canvassed by the learned counsel for the respondent. The argument was that unless pleadings in the earlier suit are available, it cannot be decided whether the judgment in the earlier suit bars the parties in the later suit, even if they are the same. Reliance was placed on the decision in Syed Mohd. S. Labbai v. Mohd. Hanifa : [1976]3SCR721 (supra) wherein it is held:

'In the instant case according to the plaintiff/respondents, the identity of the subject matter in the present suit is quite different from the one which was adjudicated upon in the suits which formed the basis of the previous litigation. In our opinion the best method to decide the question of res judicata is first to determine the case of the parties as put forward in their respective pleadings of their previous suits, and then to find out as to what had been decided by the judgments which operate as res judicata. Unfortunately, however, in this case the pleadings of the suits instituted by the parties have not at all been filed and we have to rely upon the facts as mentioned in the judgments themselves. It is well settled that the pleadings cannot be proved merely by recitals of the allegations mentioned in the judgment.'

This faint attempt to demolish the case out of hand for the failure on the part of the appellants to file pleadings herein, will not sustain for the simple reason that the pleadings are not sought to be proved with reference to the 'recitals of the allegations mentioned in the judgment': but with reference to the 'judgment' itself. Hence the contention is devoid of any merit and substance and is accordingly rejected.

26. In the result, the twin questions framed at the outset are answered in the affirmative and the second appeal is allowed, but, under the circumstances, with no order as to costs.

27. Appeal allowed.


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