1. This is a plaintiff's second appeal arising out of a suit for recovery of arrears of rent under Section 148 of the U. P. Tenancy Act. He had sued for the recovery of arrears of rent for the year 1357 Fasli. His case was that the rent agreed between the parties was Rs. 1000/- per year, and that the amount of Rs. 997/4/10 as detailed in the body of the plaint was due from the defendant. The plaintiff accordingly prayed for a decree in respect of the same. The suit was resisted by the defendant mainly on the ground that he had deposited ten times the annul rental under U. P. Agricultural Tenants (Acquisition of Privileges) Act, 1949 (U. P. Act X of 1949), and the rent fixed on the said land under this Act as payable by him was only Rs. 73/8/5. The trial Court accepted the defendants' contention, and decreed the suit for an amount of Rs. 36/11/11 with proportionate costs and with past, pendente lite and future interest at the legal and sanctioned rates.
2. The plaintiff went up in appeal. The case was heard by the learned Civil Judge, Farrukhabad, who dismissed the appeal with costs.
3. Dissatisfied with the decree passed by the lower appellate court, the plaintiff filed this second appeal in the High Court. When the case came up for hearing before a learned single Judge of this Court, the appellant's counsel questioned the correctness of the judgment of the lower appellate court on the ground that the provisions of U. P. Agricultural Tenants (Acquisition of Privileges) Act. 1949 (U. P. Act X of 1949) hereinafter called 'the Act' in so far as they affected the agreed contractual rent between the landlord and the tenant were ultra vires of the U. P. Legislature. In the view of the fact that the argument of the learned counsel raised an important question of law, the learned single Judge referred the matter to a Bench. The case accordingly came up for hearing before us.
4. Having heard the learned counsel for the appellant we are of opinion that there is no substance in the point raised by him. The Act is a provincial one, and was passed by the U. P. Legislative Assembly on 16-7-1949, and by the U. P. Legislative Council on 23-7-1949, it received the assent of the Governor on 10-8-1949, it was published in the U. P. Gazette Extraordinary dated 11-8-1949, and came into force forthwith. The object of the Act as indicated in its preamble was
'to provide for payments by tenants with a view to facilitate the abolition of zamindari and to provide for reduction of rent and protection from ejectment and for certain other matters connected therewith.'
Sections 3, 3-A, 3-B and 3-C of the Act lay down that certain classes of tenants, sub-tenants and co-tenants specified therein on payment of an amount equal to ten times the annual rent payable by them in respect of their holdings shall, on an application, be awarded a declaration to the effect that they have become entitled to the privileges provided by or under the Act. Section 4 of the Act provides the mode for the determination of rent payable by tenants. Section 6 provides the procedure to be followed by the Assistant Collector in disposing of such an application, and for the Brant of aforesaid declaration. The provision of the Act directly relevant for our purposes is Section 7(b). According to Section 7(B) of the said Act, after a declaration under Section 6 of the Act has been made, the applicant shall, with effect from the date of payment under Section 3 or deposit under Sub-section (4) of Section 6, as the case may be, be entitled to the privilege of being liable to pay only half of the rent payable by him from a certain date 'notwithstanding anything contained in any law or contract.' The learned counsel for the appellant contended that this part of the Act is ultra vires of the Provincial Legislature. The argument of the learned counsel was that the reduction of the contractual rent to half by the Act being repugnant to the law of contract, the Provincial Legislature could not enact a law to that effect. In this connection learned counsel for the appellant invited our attention to lists I, II and III of Schedule VII under Section 100 of the Government of India Act, 1935. List I contains entries in respect of which the Federal Legislature alone is competent to frame laws. List II contains entries in respect of which the Provincial Legislature alone is competent to frame Laws. The third list namely, List III is & concurrent list in respect of which both the Federal as well as the Provincial Legislature are competent to enact laws.
5. Learned counsel for the appellant relied on entry No. 10 in the concurrent list, namely list III. Entry No. 10 runs as follows :
'Contracts, including partnership, agency, contracts of carriage, and other special forms of contract, but not including contracts relating to agricultural land.'
6. The argument of the learned counsel is that the law in question falls within this entry. On this assumption, he further relies on Section 107 of the Government of India Act, 1935, which runs as follows :
'(1) If any provision of a Provincial law is repugnant to any provision of a Federal law which the Federal Legislature is competent to enact or to any provision of an existing Indian law with respect to one of the matters enumetrated in the Concurrent Legislative List, then, subject to the provisions of this section, the Federal law, whether passed before or after the Provincial law, or whatever the case may be, the existing Indian Law, shall prevail and the Provincial law shall, to the extent of the repugnancy be void.
2. Where a Provincial law with respect to one of the matters enumerated in the Concurrent Legislative List contains any provision repugnant to the provisions of an earlier Federal law or an existing Indian law with respect to that matter, then, if the Provincial law, having been reserved for the consideration of the Governor General or for the signification of His Majesty's pleasure, has received the assent of the Governor General or of His Majesty, the Provincial law shall in that Province prevail, but nevertheless the Federal Legislature may at any time enact further legislation with respect to the same matter'
(The remaining portion is not relevant) .
7. Learned counsel for the appellant argued that the provisions of the U. P. Act being in conflict with the provisions of the Contract Act (Act IX of 1872), which is a Central Act, were to that extent void under Sub-section (1) of Section 107. The Provincial Legislature could, however, under Section 107(2) enact a valid piece of legislation repugnant to the provisions of an earlier Federal law or an existing Indian law (i.e., the Contract Act in the present case) provided that the provincial law (i.e., the U. P. Act X of 1949) had been reserved for the consideration of the Governor General or for the signification of His Majesty's pleasure and had received the assent of the Governor General or His Majesty. In the present case, as the U. P. Act itself shows, it was not reserved for the consideration of the Governor General or for the signification of His Majesty's pleasure, nor had it received the assent of either. In the absence of compliance with this condition, which is imperative, the argument of the learned counsel is that the provisions of Section 7(b) of U. P. Act X of 1949, are void.
8. The entire argument of the learned counsel for the appellant proceeds on the assumption that there is repugnancy between the earlier Central law and the subsequent law enacted by the Provincial Legislature. This assumption does not appear to us to be well-founded. A reference to Section 37 of the Contract Act, 1872, Act IX of 1872, would indicate that there is repugnancy between the provisions of the Indian Contract Act and the provisions of U. P. Act X of 1949. Section 37 of the Indian Contract Act runs as follows:
'The parties to a contract must either perform, or offer to perform their respective promises, unless such performance is dispensed with or excused under the provisions of this Act, or of any other law.
Promises bind the representatives of the promisors in case of the death of such promisors before performance unless a contrary intention appears from the contract.'
Thus the above provision of the Indian Contract Act itself sanctions and recognises the existence of laws, which might dispense with or excuse the performance of an act which is binding or valid under the Contract Act, it cannot, therefore, be postulated that the law enacted by the Provincial Legislature is in conflict with or repugnant to any earlier law enacted by the Central Legislature. This view is borne out by the observations of their Lordships of the Federal Court in the case of Meghraj v. Allah Rakhia, AIR 1943 FC 27 (A). In that case it was held that where the paramount legislation does not purport to be exhaustive or unqualified, but itself permits or recognizes other laws restricting or qualifying the general provisions made in it, it cannot be said that any qualification or restriction introduced by another law is repugnant to the provision in the main or paramount law.
9. In this connection it might be argued on behalf of the appellant that this is not a case where the performance of a contract is dispensed with or excused under the provisions of the Provincial law, that in this particular case the Provincial law has substituted a new contract and imposed its conditions on the parties in a compulsory form. This argument is hot strictly correct, because the fresh liability that is imposed or the right that is conferred in the present case is not by virtue of any new contract, nor does it derive its force from any argument between the parties. It owes its origin to the orders of a court acting under a statute. The first step in bringing about the transformation has no doubt the effect of dispensing with or excusing a pre-existing liability. The second step is the creation of a new liability or conferment of a new privilege and this is the result of an act of the court.
10. Apart from the above points which militate against the argument of the learned counsel for the appellant, we are also of opinion that the premises on which the argument of the learned counsel for the appellant is based themselves cannot stand. The basis on which the argument of the learned counsel for the appellant was advanced was that the present case fell within the ambit of entry No. 10 of List III. Entry No. 10 no doubt covers contracts but it exempts from its purview 'contracts relating to agricultural land'. An agreement for payment of rent between landlord and tenant in respect of an agricultural holding would, in our opinion, be a contract relating to agricultural land. It would, therefore, fall outside the sphere of entry No. 10 of List III. The change brought about in law by the U. P. Agricultural Tenants (Acquisition and Privileges) Act, 1949, would, in our opinion, considering the aims and objects of the Act, indicate that the Act in question would fall within the purview of entry No. 21 of List II which is a Provincial List Legislative Entry No. 21 is as follows:
'Land, that is to say, rights in or over land, land tenures, including the relation of landlord and tenant, and the collection of rents; transfer, alienation and devolution of agricultural land land improvement and agricultural loans; colonization; Court of Wards; encumbered and attached estates; and treasure trove.'
An agreement between the landlord and the tenant in respect of rent of agricultural land would relate to a right in or over land, it is connected with land tenure, it is a matter directly pertaining to the relation between the landlord and tenant. It is also a matter connected with the collection of rent. This interpretation of entry No. 21 would be further borne out by the exemptive clause in entry No. 10 of List III, which excludes 'Contracts relating to agricultural land' from the file of operation of entry No. 10 of List lit As already 'observed above, the purpose of the Act as indicated in the preamble was to provide for payment by tenants with a view to facilitate the abolition of zamindari and to provide for reduction of rent and protection from ejectment and for certain other matters connected therewith. The Act itself was, therefore, an Act which was merely a step in the series of Acts promulgated for the purpose of improvement of land tenures in the State which finally culminated in the abolition of the zamindari itself. Under the circumstances, we are of opinion that, applying the principle of pith and substance, the Act would more naturally fall within the range of entry No. 21 of List II than of entry No. 10 of List in. The former entry appertains to the Provincial Legislative List. In this view of the matter, there can be no manner of doubt that the Provincial Legislature would have full competence to enact the impugned legislation, and the assent of the Governor to the said Act was quite enough to give it validity and force. For the above reasons we are of opinion that the arguments of the learned counsel for the appellant have no merit.
11. No other argument was advanced before us. This appeal is accordingly dismissed withcosts.