Sulaiman, Ag. C.J.
1. Three out of the thirty four appeals Which were connected with one another were dismissed by us yesterday, as no appeal lay to the High Court. These appeals arise out of suits for profits brought by one brother as co-sharer against the eldest brother as the lambardar. They relate to different mahals, but the points which arise in most of them are more or less common.
2. In some cases the defendant was not allowed to file his written statements as applications for adjournment of the cases on his behalf were rejected. In two cases he filed his written statements which gave us an idea of the pleas raised on his behalf.
3. It is convenient to dispose of the points which are common in all these appeals.
4. The plaintiff claimed his share of profits on the basis of gross rentals. The Court below has given him decrees on the basis of the gross rentals in all the cases. It is quite clear that if the defendant succeeds in showing the actual collections, then, unless those collections are so low that the Court may presume negligence on the part of the lambardar, the decrees have to be made on the basis of the actual collections and not on the gross rentals. On the other hand, if the discrepancy between the gross rental and the actual collection is very largo, then, in the absence of any satisfactory explanation on the part of the lambardar why he was not able to collect a larger amount, the presumption would be that he was negligent and the decree should be on the basis of gross rental. In the absence of any definite evidence either way, we would roughly take those cases in which collections exceed 75 per cent as cases in which no negligence can be presumed. In cases in which collections are less than 75 per cent of the rent there is prima facie a presumption of such negligence.
5. The defendant further claimed that under a deed of relinquishment executed by the mother and other lady relations of the parties there was a liability to pay certain annual allowances out of the income of the entire estate and that the defendant had paid these allowances. He claimed a set-off on account of these allowances in the suit for profits. The Assistant Collector has rightly disallowed this set-off. It is quite obvious that no set-off can be allowed in the Revenue Court for any amount that is not due under a decree, unless the amount can be treated as part of the ordinary expenses of collection. In this particular case it is impossible to treat the payment of these allowances as an expenditure incurred in the collection of profits because the amount has to be paid in a lump sum out of the entire income of the estate and it is not easy to apportion it separately for each village. Strictly speaking it is a discharge of liability under a registered deed of hypothecation and not a part of the ordinary expenses of collection. It is not necessary for us to express any final opinion whether the defendant will have separate remedy to recover these allowances in case he has paid them. It may be that inasmuch as there was a joint liability under a registered deed of hypothecation creating a charge on part of the estate, the defendant as one of the co-debtors having paid off the amount has his remedy by a suit for contribution by enforcement of that charge, for which the period of limitation may be 12 years. As mentioned above we would leave this point open. We have however no doubt in our minds that the allowances cannot be set off in these suits.
6. The next point in dispute is the amount of the expenditure which the lambardar can claim from his cosharers. Oral evidence was led on his behalf to show the number of employees like siyaha navis, karinda, peon, etc., who were employed in the estate for the purpose of collecting rents. It is clear from the evidence that the same staff is employed for a number of villages and it is very difficult to apportion expenditure incurred in the payment of their salaries for each village. In some cases the total income of the village is very small in other cases it is very large. On the other hand, it is quite clear that some staff must be employed by the lambardar defendant so that he may successfully make collections in so many villages which are scattered all over the district. We think that it would be highly impracticable to go into each case separately and apportion the expenditure separately. The most just and equitable way would be to fix upon a rough flat rate which would cover the expenses and give satisfactory results. Having considered the matter we are of opinion that in addition to the lambardar dues of 5% which the lambardar is entitled to get under the Land Revenue Act he should get 5% on the actual collections made by him towards the expenses of collection.
7. Another point in dispute between the parties is the costs of litigation. It is quite clear that litigation is not a part of the ordinary expenditure in the management of a mahal. In some years litigation may be very expensive and heavy and in others it may be practically nil. Where it is unavoidable, it is a necessary part of the expenditure incurred by a lambardar and it is undoubtedly incurred for the benefit of the entire coparcenary body. There is no reason why the defendant should not be credited with the taxable costs of the litigation incurred. As regards the costs incurred out of Court there would be considerable uncertainty, part of which ought to be included in the salaries of the staff. We therefore think that the defendant should be allowed credit for any taxable costs of litigation which have remained unrealized from the tenants of the various villages in suits by or against them, provided the same are shown by documentary evidence.
8. Another point in dispute between the parties is as to whether the plaintiff is entitled to interest on the arrears of profit. The Court below has allowed him interest at the rate of 61/4 per cent. It has not given any reasons why the rate of 1 per cent per mensem, which is specified in Section 225, Agra Tenancy Act 1926 was not adhered to. There is now a statutory provision which entitles a cosharer to claim interest on arrears of profit at 1 per cent per mensem. After accounts have been taken, and an amount has been found due to the plaintiff, there is no reason why he should be debarred fromclaiming the rate which is allowed by the Tenancy Act. We therefore think that there can be no doubt that the plaintiff should be given interest at the rate of 1 per cent per mensem on the principal amount of the net arrears of profit found due to him from the date when they became divisible till at least the date of the decree of this court.
9. If we were to consolidate the principal sum and interest up to the date of decree, we might under Section 34, Civil P.C, have allowed future interest at the rate of 6 per cent on the consolidated amount. The learned advocate for the defendant however urges that the plaintiff does not claim interest on the consolidated amount, but should be given 1 per cent per mensem simple interest on the principal amount of arrears up to the date of realization. We see no reason why the principle underlying Section 225 should not be applied to future interest after the decree up to the date of realization. We would accordingly allow the plaintiff simple interest at the rate of 1 per cent on his share of net profits from the date when they became divisible until actual realization.
10. The learned advocate for the defendant contends that the plaintiff had previously brought a suit for accounts against the defendant treating him as his trustee and agent for the period of the alleged agency, which was dismissed because the Court was satisfied that the plaintiff had himself removed the necessary papers, and that accordingly he is not entitled to sue for profits in the Revenue Court for the same period over again for which his civil suit had been instituted. On the other hand, the learned advocate for the plaintiff replies that the defendant held a dual capacity of the plaintiff's agent and the lambardar and he was not bound to pay the profits as lambardar to the plaintiff cosharer, whose agent he may be supposed to have been before the date on which the profits became divisible. Admittedly the profits become divisible as between the lambardar and the cosharers on 1st August following the year for which they are claimed. In the previous suit the plaintiff had alleged that the agency of the defendant terminated either on 22nd November 1924 or 10th December 1924, on account of certain letters sent by the plaintiff revoking the agency. This fact was denied by the defendant. The learned Subordinate Judge in his findings on issues 3 and 15 came to the conclusion
that the defendant continued to manage the estate as an agent on behalf of the plaintiff after the expiry of the period of the minority up to November or December 1924, when the plaintiff expressly revoked the powers given to him by means of written letters.
11. In the earlier portion of his judgment he pointed out that the plaintiff alleged that he had sent a letter on 22nd November 1924 and one on 19th December 1924, and that in this last mentioned letter he had clearly expressed his intention of putting an end to the relationship of agent which up to that time existed between the parties. There is no doubt that the learned Subordinate Judge was inclined to take the view that the agency terminated on 19th December 1924; but his actual finding was in the alternative, namely, that it terminated either in November or December 1924.
12. The previous civil suit was for recovery of the amount found due on the taking of the accounts between the parties, and it was up to the end of the period of the agency. The defendant no doubt held two capacities. If the plaintiff had sued him in the Revenue Court merely as a lambardar, his suit for recovery of profits as a cosharer would have been premature if it were brought before 1st August following. But the suit was not brought by a cosharer against the lambardar under the Tenancy Act, but it was by a principal as against an agent or trustee in the civil Court. If the suit had been decreed the civil Court would without doubt have passed a preliminary decree for an account to be taken up to the end of the period of agency which would have been either November or December 1924. The decree of the first Court came to be passed long after the expiry of 1st August 1925 when the profits against the lambardar had also become divisible.
13. It seems to us that the date fixed for the division of profits is nothing more than a date fixed for the payment of those profits. That date does not imply that the right to a share in the income does not vest till the arrival of that date. The profits accrue from day to day and become vested in the cosharers, although the time for payment is postponed for the sake of convenience till the following August.
14. Section 36, T.P. Act in terms cannot apply to this case, because that deals with the case of a transfer of immovable property. But the principle underlying that section is of a wider scope and certainly lays down the rule regulating the rights of proprietors to the receipt of income from their properties. As between two rival owners, in the absence of a contract or local usage to the contrary, all rents, annuities, pensions, dividends and other periodical payments in the nature of income accrue due from day to day, and are apportionable accordingly, but they are payable on the days appointed for the payment thereof. Under that principle although the day for the payment of the share income may not have arrived the income does accrue from day to day and is apportionable accordingly, although the actual apportionment would not in fact be given effect to till that date has arrived.
15. It seems to us that if it were established that the defendant, who was according to the view taken in the civil suit acting as the agent and trustee of the plaintiff, and in fact as the managing member of the family had in reality realized the income of the estate during the period of his agency, then, even though the actual date for the division of the profits as between cosharers and lambardar arrived after the expiry of the period of the agency, he would have been liable to render accounts for the plaintiff's share in the net profits. The civil Court in its decree for accounts would undoubtedly have made the defendant liable to pay to the plaintiff his due share in the net profits of all the income that was realized by him during the period of his agency. The previous suit therefore did involve a claim of the plaintiff for recovery of his share in the net income actually realized by the defendant before his agency terminated. Unfortunately for the plaintiff the civil suit was dismissed and no relief was granted to him. The result therefore is that the plaintiff's claim for recovery of his share in the income received by the defendant during the period of his agency was made in the civil Court, and was dismissed. It seems to us that the plaintiff cannot now be allowed to come to the Revenue Court and ask for profits for a period which would overlap, that is to say, he cannot be given a decree for his share of the profits with regard to the period which was included in the former civil suit.
16. In the present suits the plaintiff is claiming profits for the whole of 1332 and 1333 Faslis Kharif of 1332 Fasli terminated on 31st December 1924, and would therefore include a part of the period which was under consideration in the civil suit. We think that the plaintiff cannot be allowed to claim profits for that part. On the other hand if the defendant did not actually realize any part of the profits before the termination of his agency, and those profits were realized subsequently, it cannot be assumed that that amount had been claimed in the previous suit. The plaintiff therefore would not be disentitled from claiming his share 'of such profits.
17. By the expression 'net income' or 'net profits' which we have used, we mean the plaintiff's share in the net profits of the village after deducting the proportionate amounts of the Government revenue, the lambardar's clues, the expenses of collection and the costs of the litigation that may be allowed. The next point in dispute in the remaining cases is as to whether the defendant had been rightly prevented from filing his written statements in some of these suits. The suits were filed on 23rd December 1926, and the Christmas holidays followed. On 5th January 1927 an application was made on behalf of the defendant to the Revenue Court in which it was admitted that he had knowledge of the institution of these 34 suits. Subsequently on 15th January 1927 the suits wore transferred to the Court of another Assistant Collector on an application of the plaintiff for which apparently notice was not issued to the defendant. The new Court issued summonses to the defendant fixing 10th February. These summonses were sent to him at his village Dharampur and not at his house in Aligarh. On 21st January 1927 the process-server reported that the defendant was not at Dharampur but had gone to Aligarh and he accordingly brought back the summonses. The reports did not say that he had shown these summonses to any of the servants of the defendant or to any the inmates of the house at Dharampur or that he had affixed copies of them at the door of the defendant's house. In the application before the Court the plaintiff also admitted that the defendant was residing at Aligarh. On an application by the plaintiff the cases were again transferred to another Court on 8th February 1927. Again there was no notice of this transfer given to the defendant formally. Curiously enough the Court did not make any order that summonses should be issued to the defendant according to his address at Aligarh, but ordered that there should be substituted service.
18. It directed that the summonses should be published in an Aligarh paper. The order was passed on 10th February 1927; the publication appeared on the paper bearing the date 13th February 1927 fixing 15th February 1927 for the hearing. On 14th February an application was filed on behalf of the defendant stating that he had no knowledge of the suits from before and that time should be given to him for filing written statements. The Court did not consider that there was a satisfactory explanation and rejected the application not on that date but either on 15th or 16th February. In these circumstances the defendant was not allowed to file his written statements. After considering the circumstances we have come to the conclusion that it would be unfair to the defendant to debar him from taking any special pleas that may be open to him in addition to those which he had already taken in the suits which were contested.
19. Having dealt with the general aspects of the case and the points which were common to most of the appeals, we would now take up these appeals separately. We have already noted that three appeals namely, Nos. 380, 390 and 396 of 1927 have already been dismissed.
20. First Appeals Nos. 402 and 403 of 1927 arise out of suit in which the defendant had an opportunity of filing his written statements and of leading evidence. No case is made out for allowing him to produce any fresh evidence. The collections in these cases were much more than 75 per cent of the gross rentals and there is no justification for decreeing the claim on the basis of gross rentals. The defendant will however get 5 per cent on the actual collections as his expenses in addition to the 5 per cent of the Government revenue as the lambardar's dues. But in these appeals the plaintiff has filed no cross-objections as regards any further interest. He is not therefore entitled to any interest in excess of that awarded by the decree. But the plaintiff is entitled to support the decree of the Court below even on a ground which was decided against him. We are therefore inclined to think that he should be given interest at the rate quoted above provided that the principal amount plus interest up to the date of the first Court's decree does not exceed the amount of that decree in each case. Further interest in excess of that allowed by the judgment in each case will not be allowed. If on the account being taken afresh it is found that the amount duo to the plaintiff up to the date of the first Court's decree is less than that awarded by that Court, the plaintiff would be entitled to an addition on account of the extra rate of interest up to 12 per cent per annum calculated on the principal amount of profits from 1st August following the year for which they were due till the first Court's decree. In case the result is an excess amount, the plaintiff will not be entitled to the excess but the decree of the Court below will be maintained. The costs in both the Courts will be in proportion to success and failure.
21. In the remaining appeals we have already held that the defendant is entitled to file written statements and produce evidence. The question of the rate of interest is left open in those cases which are to be sent back and in which the defendant is allowed to file written statements. As the cases have been disposed of without this opportunity having been accorded to him, we must allow these appeals and setting aside the decrees of the Court below send the cases back to that Court for disposal according to law. The costs in these oases will abide the result.