1. These two second appeals arise out of two different suits, but as the point which ultimately emerges for consideration is the same in both, they have been connected and hive been heard together. One Abdullah Shah is the muafidar of certain plots of land, the total area of which is stated to be 99 of an acre, in qasba Ganjdundwara in the district of Etah. On March 29, 1927, Abdullah Shah executed a perpetual lease in respect of these plots of land in favour of one Ganga Narain. The rent reserved was Rs. 400 per annum, and the lease was expressly stated to have the power to transfer his lessee rights. On March 28, 1928, the lessee, Ganga Narain, sold his lessee rights to one Narain Das by means of a sale deed executed on that day and registered on March 31, 1928. It was laid down in this deed of sale that the vendee should comply with the conditions laid down in the lease and that the lease would be as much binding on him as it was on the vendor, the original lessee. On July 14, 1928, Narain Das the purchaser of the lessee rights from Ganga Narain, executed a deed of usufructuary mortgage in respect of the lessse rights which he had acquired under the sale deed of March 28, 1928, in favour of the present appellant, Rai Girendra Narain, and put the latter in possession of the property as usufructuary mortgagee of the lessee rights. One of the terms laid down in this deed of mortgage was that the mortgagee should continue to pay the rent due to Abdullah Shah according to the terms laid down in the lease. In accordance with that term the appellant paid to Abdullah Shah the rent due up to March 21,1930, and did not pay it thereafter.
2. Abdullah Shah brought Suit No. 563 of 1931 for the rent due for the period, April 1, 1930, to September 30, 1931, and impleaded Ganga Narain, Narain Das, and the appellant as defendants. Subsequently Abdullah Shah withdrew the suit as against the appellant with liberty to bring a fresh suit in future. Ultimately the suit was decreed against Ganga Narain. On July 6, 1932, Ganga Narain paid to Abdullah Shah a sum of Rs. 728-4-0 due under the said decree. Thereafter Ganga Narain filed Suit No. 659 of 1932 against the appellant and Narain Das for the recovery of the said sum of Rs. 728-4-0 together with a sum of Rs. 110 on account of certain costs and a sum of Rs. 16-7-0 for interest, in all Rs. 854-11-0. The learned Munsif decreed that suit against the appellant as well as Narain Das for the recovery of a total sum of Rs. 807-7-0. The appellant alone appealed to the lower Appellate Court and that Court upheld the decree of the trial Court. Second Appeal No. 839 of 1934 has been filed by Rai Girendra Narain against that decree. On December 7, 1932, Abdullah Shah filed Suit No. 846 of 1932 against Ganga Narain. Narain Das and Rai Girendra Narain for the recovery of Rs. 400 as the rent due for the period October 1, 1931, to September 30, 1932, together with Rs. 13 as interest, total Rs. 413. The learned Munsif decreed the suit against all the defendants. The present appellant, Rai Girendra Narain alone appealed and the lower Appellate Court upheld the decree of the Court of first instance. Second Appeal No. 840 of 1934 has been filed by Rai Girendra Narain against that decree.
3. The main contention of the appellant in both the appeals is that he is liable to pay the rent to his mortgagor, Narain Das alone that he is not liable to Abdullah Shah, the lessor, that therefore Abdullah Shah has no right in law to recover the rent from him direct, and that therefore neither Abdullah Shah can bring a suit against him for the recovery of the rent, nor can Ganga Narain sue him for contribution on account of the payment which he has made to Abdullah Shah. The argument is that there is no privity of estate between the appellant and Abdullah Shah, and that therefore Abdullah Shah has no fight at all to bring a suit against him for the recovery of the rent. He contends that if there is a sale of the lessee rights, then the whole of the rights of the lessee are transferred to the purchaser and vest entirely in him, and so in that case a privity of estate between such purchaser and the lessor comes into existence; but where as here, there is only a usufructuary mortgage, some rights are still left in the lessee mortgagor and so no privity of estate between the mortgagee and that lessor comes about.
4. The learned Counsel for the plaintiff-respondent, on the other hand, urges (1) that arguments as to the existence or nonexistence of privity of estate are immaterial for the purposes of this case because an obligation to pay rent is a covenant running with the land and refers to para. 2 of Section 40, Transfer of Property Act (IV of 1882) in support of the argument that in any case Abdullah Shah is entitled to the benefit of the obligation to pay rent to the lessor imposed upon Rai Girendra Narain by the mortgage, (2) that when, as has admittedly happened in this case, the transferee from the lessee has paid lent direct to the lessor and the latter has accepted it, the relationship of landlord and tenant is established between the lessor and the transferee and the former is entitled to sue the latter for the rent due to him, and (3) that a usufructuary mortgagee in possession is as good as an absolute assignee because according to the learned Counsel, the entire estate of the lessee mortgagor vests for the time being in the usufructuary mortgagee.
5. A number of cases have been cited by Counsel on both sides in support of (sic)th their respective contentions. Before coming to the cases, however, we think it necessary to refer to certain provisions of the statute law in force in these provinces. Section 108, Transfer of Property Act (IV of 1882), which deals with the rights and liabilities of the lessor and the lessee provides in Clause (j) that the lessee may transfer absolutely or by way of mortgage or Sub-lease the whole or any part of his interest in the property and any transferee of such interest or part may again transfer it. It goes on to lay down that the lessee shall not by reason only of such transfer cease to be subject to any of the liability attaching to the lease. This latter provision is, in our opinion, for the benefit of the lessor and we consider that he has the option either to take advantage of it and to enforce his rights against his lessee alone or to accept the transfer made by the lessee and to sue the transferee for the enforcement of his rights under the lease.
6. Section 27, Specific Relief Act (I of 1877), provides that except as otherwise provided by Chapter II of the Act, specific performance of a contract may be enforced against (a) either party thereto, and (b) any other person claiming under him by a title arising subsequently to the contract, except a transferee in good faith and without notice of the original contract. Section 91, Trusts Act (II of 1882), lays down that where a person acquires property with notice that another person has entered into an existing contract affecting that property of which specific performance could be enforced, the former must, hold the property for the benefit of the latter to the extent necessary to give effect to the contract.
7. Now the appellant, Rai Girendra Narain, not only had notice of the original contract between Abdullah Shah and his lessee that a sum of Rs. 400 per annum shall, be paid as rent to, Abdullah Shah but actually undertook by an express term embodied in the deed of mortgage dated July 14, 1928, to pay that rent to Abdullah Shah in, accordance with the conditions laid down in the deed of lease. Furthermore, it is common ground that the appellant paid to Abdullah Shah the rent due up to March 31, 1930, and that Abdullah Shah accepted it from him. The appellant is a person claiming under a party to the deed of lease of March 29, 1927, by a title arising subsequently to the contract of lease. In these circumstances we are of opinion that Abdullah Shah is entitled to enforce against the appellant the contract to pay rent entered into by the lessee.
8. In the view which we have taken, it is not necessary to discuss in detail the cases cited by the learned Counsel. We propose therefore to refer to them only briefly. The cases which the learned Counsel for the appellant has cited are those of Theethalan v. Eralpod Rajah 40 M. 1111 : 40 Ind. Cas. 841 : A.I.R. 1918 Mad. 425 : 22 M.L.J. 442 : 21 M.L.T. 401, Jiban Krishna Mullick v. Nirupama Gupta 53 C. 922 : 96 Ind. Cas. 846 : A.I.R. 1926 Cal. 1009 : 30 C.W.N. 812; Ramchandra Jat v. Bhowaniram ; Jethanand v. Udho Das A.I.R. 1931 Lah. 614 : 131 Ind. Cas. 121 : 32 P.L.R. 422, and Adhar Chandra v. Dol Govinda Das : AIR1936Cal663 . It will be noticed that the Madras and Calcutta cases cited above discuss, decisions of the Courts in England at great length and in none of them has any reference been made to Section 27(b), Specific Relief Act, or to Section 91. Trusts Act. It will also be noticed that there is considerable divergence of opinion in Calcutta. It may, however, be mentioned that the learned Chief Justice in his judgment in the case reported in Theethalan v. Eralpod Rajah 40 M. 1111 : 40 Ind. Cas. 841 : A.I.R. 1918 Mad. 425 : 22 M.L.J. 442 : 21 M.L.T. 401, observes at p. 1113 Pages of 40 M-[Ed.], that if the lessor accepts rent from the assignee, a privity of contract would come into existence between them. The basis of the decisions on which reliance is placed on behalf of the appellant was that a sub-lessee or mortgagee of lessee rights is not ipso facto brought into direct relations with the landlord lessor. That principle cannot, in our opinion, be applied to a case where the mortgagee has paid rent to the lessor and the latter has accepted it from him. The Nagpur and Lahore cases cited are decisions by single Judges and are also distinguishable on the facts. As to the Calcutta decisions, the learned Counsel for the plaintiff-respondent has invited our attention to the cases in Debnarayan Dutt v. Chunilal Ghose 41 C. 137 : 20 Ind. Cas. 630 : A.I.R. 1914 Cal. 129 : 17 C.W.N. 1143 : 18 C.L.J. 603; Dwarkanath Ash v. Priyanath Malik 22 C.W.N. 279 : 36 Ind. Cas. 792 : A.I.R. 1918 Cal. 941 : 27 C.L.J. 483 and Khirodebihari Dutt v. Mangobinda : AIR1934Cal682 , as cases in which the opposite view has been taken. We are content to say that we agree with the judgments of Sir Lawrence Jenkins C.J. in Debnarayan Dutt v. Ghunilal Ghose 41 C. 137 : 20 Ind. Cas. 630 : A.I.R. 1914 Cal. 129 : 17 C.W.N. 1143 : 18 C.L.J. 603, and of Lort-Williams, J. in Khirodebihari Dutt v. Mangobinda : AIR1934Cal682 . We might also refer to the decision of their Lordships of the Privy Council in Muhammad Khan v. Hussaini Begam 37 I.A. 152 : 7 Ind. Cas. 237 : 32 A. 410 : 7 A.L.J. 871 : 14 C.W.N. 865 : (1910) M.W.N. 313 : 8 M.L.T. 147 : 12 C.L.J. 205 : 12 Bom. L.R. 638 : 20 M.L.J. 614(P.C.). For the reasons given above, we are of opinion that this appeal has no force and we dismiss it with costs.