1. This is a plaintiff's appeal arising out of a suit for a declaration that certain ejectment proceedings carried through in the Revenue Court were null and void and ineffectual as against the right of the plaintiff and that the defendant No. 1, the zamindar, had not acquired any right in the said lands as' against him. There was a further prayer for a declaration that the proceedings relating to delivery of possession in favour of defendants Nos. 3 to 9 were also not binding on him. There were many pleas takes in the written statement filed by the contesting defendants to which we shall refer later. The Court of first instance dismissed the suit and on appeal that decree has been affirmed by the District Judge.
2. In order to understand the points in dispute it is necessary to recite briefly the history of this litigation.
3. It appears that the defendant No. 1, who is a zamindar of the village, granted two leases in November, 1909 in respect of different sets of plots in favour of the defendant No. 2, the terms of which are worthy of note. The lessee was to remain in possession of the plots leased generation after generation on payment of a fixed rent without any right of enhancement. There was a further provision that he would be entitled to transfer the lands by way of sale or mortgage like a fixed-rate tenant. It was further provided that if rents were not paid, the zamindar would have the right to recover them in the way provided by law, and it was recited that the lessee could, apply to the Revenue Court for the mutation of his name as a perpetual lessee (pattadar dawami).
4. Under the power given to him in 1914 the defendant No. 2, the lessee or tenant made three mortgages of his rights, but all these three mortgages were simple and not usufructuary. On the 17th of June, 1919 a suit was instituted by defendants Nos. 10 and 11, two of the mortgagees, against the tenant-defendant No. 2 and other subsequent transferees, for sale of the property. A preliminary decree was obtained on the 31st of October, 1919 which was followed by a final decree elated the 17th of June, 1920. In execution of this decree the interest of the tenant was put up for sale and sold on the 20th of July 1921 and a formal delivery of possession followed on the 31st of August, 1921 in favour of the auction-purchaser, the present plaintiff.
5. Almost simultaneously with these proceedings, it appears that the zamindar, after the institution of the suit by the mortgagees, filed a suit for arrears of rent on the 27th of August, 1919 in the Revenue Court against the tenant-defendant No. 2. On the 15th of September, 1919 he obtained a decree for arrears. In December of that year the zamindar applied for ejectment of the defendant-tenant under Section 59 of the Tenancy Act. Before the tenant was finally ejected, the mortgagees, who had by that time already obtained their final decree for sale, applied to the Revenue Court for stay of proceedings for ejectment and offered to pay up the arrears. Nevertheless while the application was still pending and was undisposed of, the Court actually ejected the tenant and put the zamindar in possession of the lands on the 15th of February, 1921. On the 6th of May, 1921 the application of the mortgagees was ultimately rejected. Much trouble has arisen because the Revenue Court did noli accept the payment by the mortgagees of the arrears of rent and did not grant relief to the tenant after the payment had been made.
6. Having failed in their attempt to get the ejectment proceedings stayed in the Revenue Court, the mortgagees applied to the Civil Court for a personal decree against defendant No. 2 fearing that his rights somehow became extinguished. This application was also rejected. They then proceeded to execute the decree and to put the interest of their mortgagor, the tenant, to sale. This interest has been sold and purchased by the plaintiff.
7. The Courts below have takeii the view that the mortgage made by the tenant was subject to the right of ejectment by the siubinindar, and that, therefore, as soon as The tenant was duly ejected by the order of the Revenue Court, the mortgage was extinguished, and that, therefore, after that date no interest whatever remained in the mortgagor-tenant which could have been put up for sale and purchased by the plaintiff. The view of the Courts below therefore, is that by the auction-purchase the plaintiff has acquired no interest whatsoever and his suit is bound to fail. This is the substantial point which arises in this case. There were questions of the six months rule of limitation the plea of a bar under Section 42 of the Specific Belief Act and a few other matters.
8. As the suit has been dismissed by the lower appellate Court OH the substantial question as to whether the plaintiff acquired any rights by his auction-purchase, it is necessary for us to examine that point first.
9. Unfortunately no direct authority has boon cited before us which would cover this case exactly, that is to say, no case has been cited before us which would show whether the result of the ejectment proceeding against the mortgagor-tenant is to extinguish the rights of the mortgagee automatically. The learned Vakil for the respondents however, has relied on certain remarks found towards the close of the judgment in the Full Bench case of Khiali Ram v. Nathu Lal (1893) 15 All. 219. That, however, was not a case of mortgage of any tenancy but was really a case of sub-letting. Any remarks, therefore, bearing on the rights of a mortgagee are at most obiter dicta but of course they are entitled to weight. The learned Judges, in order to prevent any misunderstanding or misapplication of their decision thought it necessary to remark that it was obvious that the interest in an occupancy holding of any person to whom an occupancy tenant sub-lets or to whom he grants a usufructuary mortgage of land comprised in his occupancy holding will determine on The termination of the right of occupancy and can subsist no longer than the right of occupancy subsists. They go on to add that 'the rights of the zamindar to obtain an enhancement of the rent payable to him or to obtain an ejectment of his occupancy tenant and of those, holding under him, cannot be interfered with or lessened by the fact that his occupancy tenant has by a lease or other form of sub-letting or by usufruotuary mortgage to the granting of which the zamindar was not an actively oonssnting party sub-let or mortgaged the occupancy holding or any part of it.' Over and above the fact that the observations were not necessary for the purpose of that case, it is to be noted that they were dealing with the case of a mortgage of an occupancy holding. Furthermore the learned Judges expressly excluded from the operation of the rule laid down by them cases where to the granting of mortgages the zamindar was an actively consenting party.
10. In order to see whether the observations made in that case are applicable, we must, in the first instance, examine the true nature of the rights created by the lease. It was first contended before us that the rights created were those of a fixed-rate tenant. In this particular case, however, it was clearly a perpetual lease granted to the tenant, the condition of the lease being that there would be no enhancement of rent and that the rights would be inheritable and transferable. In our opinion this was clearly a lease for agricultural purposes granted in perpetuity by the zamindar with the express power given to the grantee to transfer his rights. Under Section 20, Sub-clause (3) of the Tenancy Act the interest of a thekedar is, subject to the terms of his lease, heritable but not transferable. That clearly implies that if under the express condition of the lease the right is made transferable, it would be transferable. We have already mentioned that such an express power was given by the zamindar. The tenancy in the present case is, therefore, in the first place distinguishable from the tenancy which was the subject-matter in dispute in the Full Bench case. Under the old law the occupancy holding could be transferred by way of a usufructuary mortgage, but in that case there was no express agreement or consent by the zamindar. In the present case ble rights of the tenant were not transferatho under the law. They became transferable because of the express contract between the zamindar and the tenant. It is clear, therefore, that in this case the zamindar must be deemed to have been an actively consenting party to the mortgages because he gave an express authority to the tenant to make such a mortgage. The observations in the Full Bench case, therefore, cannot be held binding on us when we have to consider the facts of the present case.
11. We may mention that in the Full Bench case of Tulshi Ram Sahu v. Gur Dayal (1911) 33 All. 111, a mortgage had been made by a fixed-rate tenant after which he was ejected; the zamindars, however, instead of claiming absolute possession of the property on the ground that the mortgage had been extinguished, instituted a suit for redemption and were ready and willing to redeem the mortgage. The learned Chief Justice, at page 116, remarked that the plaintiffs zamindars were clearly entitled to redeem the mortgage held by the respondents if they are not entitled to possession of the holding without redemption but the question whether the plaintiffs are bound to discharge the mortgage itself does not arise, because they are willing and have offered to do so. That case, therefore, left this point altogether open.
12. It must be conceded that these leases were leases for agricultural purposes and, therefore, under Section 117 of the Transfer of Property Act the provisions of Chapter V of that Act are not applicable. But ordinarily when power is given to a tenant to transfer his land, unless we are satisfied that there is some provision in the Tenancy Act which automatically puts an end to a mortgage after ejectment, it would be just and equitable to hold that the mortgage subsists even after such ejectment. The only section on which reliance is placed in order to show that the mortgage is extinguished is Section 18 of the Tenancy Act. Under that section it is provided that a right of occupancy shall be extinguished (a) when the tenant dies leaving no heir entitled to inherit it, (b) in land from which he has been ejected in execution of a decree or order of a Court, (c) in a holding which the tenant has abandoned or surrendered after service of a notice and (d) in land which has been acquired for a public purpose or a work of public utility. It is contended that the provisions of this section are absolute and they necessitate the extinction of the right of occupancy when a tenant has been ejected in execution of a decree or order of a Revenue Court.
13. It is clear that the section cannot be read in that wide and general sense. It has been held in a number of cases by this Court that where a tenant has abandoned or surrendered his holding after having made a mortgage which by law he is entitled to make the mortgage is not extinguished with the extinction of the right of occupancy. Vide the oases of Badri Prasad v. Sheo Dhian (1896) 18 All. 354, Brij Kumar Lal V. Sheo Kumar Misra (1915) 37 All. 444 and Chhiddu v. Sheo Mangal Singh (1917) 39 All. 186. Similarly it has been held at least by the Board of Revenue that when a tenant dies without leaving any heir entitled to inherit and the ssamindar takes possession of the tenancy, he cannot avoid the mortgage and eject the mortgagee without redeeming him. Vide the oases of Nand Kishore Pande v. Muhammed Hasan (1915) 29 I.C. 555 and Lal Bahadur Rai v. Maharaja of Vizianagram (1916) 33 I.C. 556. It is, therefore, clear that at least in oases which fall under two sub-clauses of this section, it has been held that a mortgage is not necessarily extinguished with the extinction of the occupancy right. Is there then any good ground for holding that the mortgage is extinguished when a case falls under Sub-clause (6), that is to say, when the tenant is ejected? In our opinion there is a clear distinction between the extinction of the occupancy right and the extinction of the mortgage. 'When the zamindar has given an express power to the tenant to mortgage his land and a mortgagee takes a mortgage of the land under the assurance that the zamindar has authorised it, it seems unjust and inequitable that behind the back of the mortgagee the zamindar would be able not only to eject the tenant but also to put an end to the mortgage.
14. It has been contended that the case of an ejectment stands on a different footing from that of a mere surrender, for it is said that a voluntary surrender involves an idea that a tenant intends to commit a fraud on his mortgagee, whereas ejectment proceedings are the result of an order of a Revenue Court. But when closely examined, the position in the two cases very often may be exactly the same. The tenant voluntarily surrenders the land not only to defraud the mortgagee but sometimes to get rid of his liability to pay rent to the zamindar when he finds it to be onerous. On the other hand, a person may willingly submit to his ejectment by simply not paying arrears of rent which involves his ejectment. In either case there may or may not be a fraud but on principle it seems to us that there is really no valid distinction. If a tenant is entitled to make a mortgage of his land and thus to transfer his interest in the tenancy to a third party, the interest so transferred under the express authority of the zamindar should not be allowed to be extinguished, unless the person who has acquired that interest has had an opportunity to prevent that extinction. This seems to be a just and equitable view which we are bound to uphold unless there is a statutory provision to the contrary. We find nothing in Section 18 which would compel us to hold a contrary opinion.
15. We are, therefore, of opinion that the ejectment proceedings in the Revenue Court, although they put an end to the tenancy of the defendant No. 2 did not have the necessary effect of destroying the rights and interests of the mortgagees, defendants Nos. 10 and 11. If the interests of the mortgagees, defendants Nos. 10 and 11, subsisted even after the ejectment proceedings, then it is clear that those rights were capable of being put up for sale and purchased by the present plaintiff. The result of the purchase made by the present plaintiff would then be that he would be entitled to occupy the land and hold it on till he is redeemed by the zamindar who must be deemed to have stepped into the shoes of the tenant-mortgagor whom he has ejected. The view of the Courts below then that nothing passed to the plaintiff by the auction-purchase is not sound and must be over-ruled.
16. There were, however, a number of other defences to the case. One of those was that the present plaintiff was at best a tenant and the defendant-zamindar having obtained possession more than six months before the suit the claim was barred by time and was not maintainable in the Civil Court. Reliance has been placed on Section 79 of the Tenancy Act, under which a tenant ejected otherwise than in due course of law has a remedy against the zamindar. It has, however, been held by a Bench of this Court in the case of the Collector of Benares v. Shiam Das (1915) 13 A.L.J. 329 that Section 79 can have no application to the case of an auction-purchaser who never actually or constructively was in possession of the tenancy and who in fact acquired his interest at an auction-purchase subsequent to the ejectment. The present plaintiff is not a tenant who has been ejected by the zamindar. In fact the person who was ejected was a person whose interest he had purchased at the time when eiectment took place. Neither the plaintiff nor the mortgagee had any locus standi to obtain actual possession before the ejectment. They were neither in actual nor in constructive possession. The person in possession, was the tenant. The present suit, therefore, is maintainable in the civil Court and would not be barred by the six months rule of limitation. This was the view clearly expressed in the above-mentioned case with which we agree.
17. The next point raised in the Court below was that defendants Nos. 3 to 9 had already obtained a decree to the effect that two-thirds of the lands sold and purchased by the plaintiff wore not liable to be sold because they never belonged to the mortgagor tenant but belonged to these contesting defendants. This point has not been clearly disposed of by the learned Judge. The determination of this question will depend on a number of circumstances which we have not considered. It is, therefore, proper that this matter should be left open for disposal after remand.
18. There is a third point raised that the present claim was barred by the provisions of Section 42 of the Specific Belief Act. The learned Judge has not dismissed the suit on that technical ground. It might have been possible to allow the plaintiff to recover possession on payment of necessary Court fees, but that of course would be a matter entirely in the discretion of the lower appellate Court. As we have said, the suit was not dismissed on that technical ground and, therefore, we do not propose to say anything on that matter.
19. We accordingly allow the appeal and setting aside the decree of the lower appellate Court and the finding that nothing passed to the plaintiff by the auction-purchase, remand the case to that Court for disposal according to law. The costs of this appeal will abide the event and will include fees in this Court on the higher scale.