1. This appeal arises out of a suit under Section 164 of the N.W.P. Tenancy Act of 1901.
2. Thakur Ganga Singh (plaintiff-respondent) sued Musammat Chhabraji Kunwar, Lumbardar, (defendant-appellant), for his share of the profits of the village for the years 1321 and 1322 Fasli, In his plaint he stated that the village was well irrigated and that the tenants were well-to-do; and, without alleging any specific misconduct or negligence on the part of the Lambardar, (except in one particular which has been abandoned), claimed to be paid a sum of Rs. 2,200 which included interest, on the basis of the gross rental. He went on, however, to state in Paragraph 4 of his plaint that, 'in the years in question the defendant Lambardar realised a considerable amount on account of arrears for the past years and the plaintiff is entitled to get the profits on the said amount according to his own share.'
3. The relief sought was (a) a decree for Rs. 2,200, Principal and interest and (b) 'a decree for the amount which is found due in addition to the amount claimed may also be passed in his favour and an additional Court-fee charged.'
4. To the plaint was annexed an account showing what was due for the two yearn in suit, 1321 and 1322 Fault It is, therefore, clear that the suit was mainly concerned with the profits of these two years. Court fees were paid only for the profits of these two years, and the accounts filed with the plaint referred ex-clusively to them, No details were furnished as to collections made for years before 1321 Fasli. The main defense was that there was no negligence or misconduct and that plaintiff was only entitled to a decree on the basis of actual collections.
5. The Trial Court held that the Lambardar defendant had been guilty of misconduct, and gave a decree for the two years in suit on the gross rental, and also a further sum for the years 1318. 1319 and 1320 for arrears which he found had been recovered by the defendant in the years in suit. In all, he passed a decree for Rs. 3,190 3 0 with costs and interest in favour of the plaintiff. On appeal the District Judge upheld this decree. Hence this second appeal.
6. Two main grounds have been argued:
(1) That the decree should have been passed either on the basis of the gross rental for the two years in suit-, or on the basis of actual collections during those two years, which would, of course, include collections of arrears of rent due in previous years, but that it was wrong to give a decree for the gross rental plus such arrears.
(2) That misconduct or negligence had not been established and that, therefore, the decree should be passed according to the actual collections.
7. It has been held, certainly since the decision in Nand Kishore v. Ram Ratan A.W.N. (1887) 250, that the divisible profits for any agricultural year mean, ordinarily, the net balance remaining in the hands of the Lambardar after deducting the land revenue, cesses, village expenses and Lambardari dues from his total realisations made during the year in question, whether on account of the demand of the year itself or on account of the demand of previous years. If a plaintiff claims under Section 164, Clause (2), on the basis of goes rental for his share of the profits of any given year, he cannot also get a decree for arrears of past years, collected in the year in question; because, to hold otherwise, might be to evade the law of limitation. Indeed, it was admitted by the learned Vakil for the respondents at a late stage of the argument, that as the suit was filed on the 20th November 1915, the arrears for 1318 and 1319 as such were certainly time-barred and probably most of the arrears of 1320.
8. This is evident from the limitation for suits under Section 164 set out in the 4th Schedule, No. 16, appended to the Act. The limitation is three years, and the time from which limitation begins to run, is when the share of the profits becomes due.
9. We think, therefore, that the plaintiff is entitled to a decree either on the gross rental of the two years in suit only, if Clause (2) of Section 164 is applicable, or on the has is of actual collections made in those two years, whether in payment of the demand of those years, or as arrears due from formed years but collected in those two years.
10. This was the view adopted in Sham Lal v. Raj Bahadur The judgment in Shim Lal v. Raj Bahadur S.A. No. 1762 of 1915, decided on the 27th une 1917 by Piggottand yves, JJ., is as follows: 'his was a suit by two plaintiffs against a Iamhaidar for profits Tho olaim was decreed in part by the Court of first instance There was an apneal and a cross appeal to the ourt of the District Judge, with the result that the sum decreed in favour of the plaintiffs was slightly increased. We have now before us an appsal by the defendant Lamb into-and cross-objections filed by tho plaintiffs. We dispose of the defendant's appeal first the plaintiffs are brothers; but it is found that they are not living jointly. They are, therefore, presumab y owners in severalty of their recorded shares. On this state of facts the contention has been based that a single suit by the two plaintiffs would not lie. There is no real force in this contention under tho provisions of the Tenancy Act itself, and in any case the contention is sufficiently met by Order I, Rule 1 of tho Code of Civil Procedure. The plaintiffs were entitled to join in bringing a single suit.
The second point argued before us is that there has been some error or miscalculation in the decree of the court of first instanoe in the matter of costs. The point was not taken before the lower Appellate-Court, and we arc not satisfied that it is any business of ours to go into the question whether the lower of the first Court in the matter of cost is or, is not strictly in accordance with the judgment. At any rate, wo are not satisfied that any mistake to the detriment of the defendant-appellant was made in that Court.
The third point argued was one of some little difficulty. It appears that there weie two tenant holdingins the Mahat in suit the rent of which was not, collected during the years in suit, and as a matter of fact the land lay fallow. The lower Appellate Court has, nevertheles, come to the conclusion that there is a fair inference that the Lambardar was guilty of negligence in not realising this rent during the yours in suit, We shall have to point out presently, in connection with the cross-objections of the plaintiffs, the consequences which, in our opinion follow from the fact that the decree of the Court below in favour of the plaintiffs has been based upon the gross recorded rental demand on account of each of the years in suit. On the whole, we are of opinion that, though this question of the two uncultivated holding's is a very arguable one, sufficient cause has not been made out for interference on our part in second appeal with the findings of the District judge
The only other point to be considered in connection with the defendants' appeal is that the ' courts below have estimated the rent of the sir land at Rs. 25 per annum. It is contended that, as a matter of fact, the land in question was let out on lease during the years in suit at an annual rental of Rs. 50 only. This question has been considered in both the courts below, and there is a finding that the rent of the sir land during the years in suit was Rs. 125 per annum. We are not prepared to say that this finding rests up n no evidence: so far, therefore, as the defendant's appeal is concerned, it feils and we dismii-s it accordingly with costs including fees in this Court on the higher scale.
In the cross objections be the plaintiffs a point is taken at the outset which has come general importance. The suit as brought is on account of the plaintiffs' share of the divisible profits for the yeara 3 5-11-16- and 1307F At the commencement of this period, there were arrears of rent amounting to Rs. 873-12-3 due from tenants on account of the years 1312, 1313 and 1314. During the years in suit a portion of those arrears was realised, amounting in all to Rs. 340-11-2. In the Court of the Assittant Collector the argument was apparently limited to the question whether tho plaintiffs could, claim in this suit their share of those realisations on account of the rental demand for years anterior to those in suit. Dealing with this question as a pure question of law, the Assistant Collector hold that tho collections on account of rental demand of previous years, if made within the years in suit, were liable to bo taken into account in the total of collections made during those, years for tho purpose of ascertaining the divisible profits. For this finding the Assistant Collector referred to the authority of the case of Nand Kishore v. Ram Ratan A.W.N. (1887) 250, and there can be no question as to the correctness of this principle, in the case of a decree for profitspassed on the basis of actual collections However, the Assistant Collector went on to consider further whether the defendant Lambariar wss not liable nnder the provisions of Section 104, Clause (2) of the Tenancy Act, No. II of 1904 to give an account of profits duo on account of sums which had remained unrolleeted owing to negligence or misconduct on his part, and came to tho conclusion that, upon the evidence before him, the only satisfactory method of adjusting the account for profits between the parties was to hold the defendant Lumbardar liable to account for profits onihe basis of gross annual rental. It is evident think, having come to that conclusion, the Assistant Collectpr no longer regarded the question of the realisafions made during the years in suit on account of the arrears of, 131-1314 F., as of any consequence. He worked out his decree on the basis of the gross rontal demand for each of the years in suit on account of the said years. When the plaintiffs presented their appeal to the Court of the District Judge, it would almost seem as if they had not considered tho decree of the court below, or appreciated the basis on which it proceeded. Their argument to the District Judge seems to have been based upon the assumption that they had been allowed their proportionate share out of the realisations of Rs. 340-342 already referred to. What they claimed was that they should have been allowed their share out of the gross one-standing demand on account of the arrears due at the beginning of the period for which the suit was brought. This contention the learned District judge has dealt with in a carefully reasoned portion of his judgment and has repelled it It is pow contended, bifore us that the plaintiffs should have been allowed one of the two things, either their share of the sum of Rs 340-11-2 actually realised during the years in sujt, or their share of the outstanding demand of Rs. 873-12-3. We are not prepared to accede to either of these contentions. Divisible profits of the agricultural year 1315 F. mean ordinarily the net balance remaining in, the hands of the Lambardar after deducting the land revenue, cesses, village expenses, and Lamhardar's dues from his total realisations made during tho year, whether on account of the demand of the year itself or on account of the demand of previous years. If, however, the plaintiffs desire to invoke the provisions of Section 164, Clause (2), of the Tenancy Act, they cannot do more than claim an account on the gross rental demand for the year 1315F, itself. To hold otherwise would be, as the learned District Judge has pointed out, to evade the law of limitation and go beyond the intention of Section 164 of the Tenancy Act. The very utmost which a Lambardar can be required to do is to account to his co-sharers for profits on the basis of the total recorded rental demand of a given year. This contention on behalf of the plaintiffs, therefore, fails.
In one or two minor points, however, we are of opinion that the plaintiffs have reasons on their side. The first Court allowed the defendant to deduct, on account of his expenses of management during the year in suit, a total sum of Rs. 228 plus Rs. 45 or Rs. 273 in all on account of the expenses of certain litigation in which one Abdul Qayum was plaintiff and the parties to the present suit were jointly impleaded as defendants. The documentary evidence on this record as to the circumstanees and result of this litigation is scanty; but so far as it goes it affords no basis for the contention that the expenses incurred by the defend, ant in this litigation were incurred by him in his representative capacity as Lambardar. In fact we would go so far as to say that there is no evidence on this point and that the documentary evidence shows the precise contrary. The suit brought by Abdul Qayum was not against Sham Lal as Lambardar of a Mahal, but against Sham Lal and his two nephews, the present plaintiffs, as the owners of the land about which the suit was brought. An appeal to the Court of the District Judge was lodged by Sham Lal alone. It is quite possible that Sham Lal, having satisfied Abdul Qayum's decree for costs, has now a valid claim for contribution against the present plaintiffs in respect of some portion of the costs paid by him; but it seems to us quite impossible, upon the evidence-on the record, to treat those costs as forming any-part -of the Lambardar's expenses of management; still less so as expenses of management on account of the years now in suit, seeing that the satire litigation with Abdul Qayum was completed in the month of February 1906--two years before the period now in suit. In two other matters of detail the decree of the lower Appellate Court is not quite just to the present plaintiffs. By an obvious oversight the learned Judge has allowed the plaintiffs from only out of a certain item of Rs. 90 whereas their share was 3/4th and they should have been allowed Rs. 67-8-0. He has also comitted to notice that interest from the date of the Assistant'Collector's decree ought to run upon the sum of Rs. 245-8-6 awarded as costs to the plaintiffs by the decree of that Court. The learned Judge probably intended that interest should run upon this amount; but he has not made it clear in his decree and we think we ought to supply the omission. The result is as follows: There will be, first of all, an addition of Rs. 7-8-0 to the sum decreed in favour of the plaintiffs. Then there will be a further addition of 3/4th of Rs. 273 (or Rs 204-12-0) due to our expunging from the account of expenses the sum allowed to the Lambardar in connection with Abdul Qayum's suit. These sums will be added to the amount decreed by the learned Judge and the interest account must be pro-portionately increased, both prior to the institution of the suit and pendente lite. We leave undisturbed the orders of the Court below as to costs, As regards the costs of this Court, we have already ordered that the defendant shall pay all costs of his appeal. With regard to the cross-objections taken by the plaintiffs, parties will pay and receive costs in proportion to their failure and success. The decree must be prepared accordingly. Costs in this Court will include fees on the higher scale by a Divisionals Bench of this Court of which one of us was a member. We see no reason to doubt that decission. We have, however, been pressed with the decision in Ram Dayal v. Seth Janki Prasad S.A. No. 996 of 1906 deoided on the 3rd January 1908, by Stanley, C.J. and Burkitt, J. which, it is argued, lays down the contrary. That decision, however, it seems to us, is based on the particular facts of that case, and has no general application, There a co-sharer assigned her share of the profits for two years only, i.e., 1307 and 1308, to the plaintiff. The plaintiff sued the Lambardar for the profits of those two years, on the basis of gross rental under Section 164(2). The matter was referred to arbitration. The arbitrator awarded profits for the two years on the basis of astual collections, and gave anaward for suoh amount ashad been collected; and declared that the plaintiff should reoover in the future any arrears for those two years from the Lambardar if he realised them. The plaintiff then brought a suit to reoover the balance of the arrears for 1307 and 1308 subsequently collected by the Lambardar. The suit was brought within three years of the date when the Lambardar realised them, and this Court held that he was entitled to a decree under the award, although the co-sharer herself couldnot have recovered them in an ordinary suit for profits for the year when the transferee brought the suit, that was altogether a special case. The arrears for 1307 and 1308 were, as it were, ear-marked as payable to the transferee and could be re-covered by suit within three years of their realisation. It now remains to see whether the Courts below were right in applying Clause (2) of Section 164.
11. It is argued that in second appeal we cannot go behind the finding that there was misconduct or negligence on the Lambardar's part within the meaning of Section 164, because it is a finding of fact. We do not think it is purely a finding of fact. What the Trial Court finds is that the Lambardar did or omitted to do certain things, and if the lower Appellate Court has come to the same conclusion, we are bound to hold that those things were done or that those omissions were made, but whether they amounted to negligence or misconduct within the meaning of the section is an inference of law. No where the Trial Court based its finding of misconduct and negligence on three main grounds; (1) the actual colleation in 1321 was very small compared with the demand. The demand wan Rs. 5,718-12-9 and the amount actually collected in that year was Rs. 2,091-4-6. If that stood alone the Trial Court might have drawn an adverse inference from it, but he has overlooked the fact, that the actual collection was more than the demand it was Rs. 6,014-13-2, that is to say, arrears for former years to a large amount had been resovereS. It is quite probable that the comparatively small amount realised in 1321 was owing to the large realisations of past arrears, and would have been made good in the future.
12. Then the Court finds, (2) that the Lambardar makes collections all the year round and, (3) instituted more than seventy suits to reeover arrears. From this the Court infers that he was negligent in his duties; we infer exactly the opposite.
13. However, we need not press the matter further, because the learned Vakil for the plaintiff has frankly admitted that the decree should be on actual collections, having regard to our decision on the first ground of appeal.
14. That being so, it is admitted that this appeal must succeed in part We have some to the oonolusion that the plaintiff is entitled to Rs. 870-3-0 for 1321 Faili together with interest at 12 per cent, from the 8th of June 1914, up to the date of suit and there after at 6 per cent, up to the date of realisation, and he is further entitled to Rs. 394-7-11 together with interest at 12 per cent, from the 27th of June, 1915, up to the date of suit and there after at 6 per cent, up to the date of realisation. The office will prepare an account on the basis of this order. The parties will receive and pay sosts in proportion to failure and success in all Courts. The costs in the lower Appellate Court and in this Court will be calculated on the value of the appeals and the extent to which either party has succeeded or failed. The decrees of the two lower Courts are set aside and a decree as indicated above will be substituted for them.