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Kanji and Moolji Brothers Vs. T. Shanmugam Pillai - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai
Decided On
Reported inAIR1932Mad734; (1932)63MLJ587
AppellantKanji and Moolji Brothers
RespondentT. Shanmugam Pillai
Cases ReferredSambayya v. Gangayya I.L.R.
Excerpt:
- - it was clearly an agreement to create an interest in land. on the other hand, it is well settled that an unregistered document is admissible as evidence of a personal covenant or of a collateral transaction which does not require registration......dated 4th august, 1927, contained the contract between the parties. having so found, the learned judge, rightly in our judgment, held that the agreement was for the transfer of an interest in immoveable property. the terms of the agreement were that in payment of compensation (in point of fact a sum of rs. 500) the defendants were given liberty to remove sand and earth from the plaintiff's plots of land to depths varying from 2 ft. to 8 ft. and were to level the plots after removal. there was also the stipulation that the land was to be vacated on or before 1st october, 1928. although the parties are described in the document as lessor and lessee, the agreement was not, in our view, one of lease. further, the agreement gave more than a mere licence, and it was not an agreement.....
Judgment:

Cronish, J.

1. The defendants are the appellants. They were sued for damages for breach of a covenant to level plaintiff's land after removing earth and sand therefrom. The plaint alleged an agreement, dated 25th June, 1927. The defendants in their written statement denied this agreement. But they alleged an unregistered agreement in writing, dated 4th August, 1927, under which, and in consideration of a rent of Rs. 500, they took on lease the suit lands subject to the covenants contained in the agreement; and they further pleaded that 'all conditions and covenants binding on the part of the defendants were duly performed and that the lands were properly levelled'.

2. The learned trial Judge has found that the written agreement, dated 4th August, 1927, contained the contract between the parties. Having so found, the learned Judge, rightly in our judgment, held that the agreement was for the transfer of an interest in immoveable property. The terms of the agreement were that in payment of compensation (in point of fact a sum of Rs. 500) the defendants were given liberty to remove sand and earth from the plaintiff's plots of land to depths varying from 2 ft. to 8 ft. and were to level the plots after removal. There was also the stipulation that the land was to be vacated on or before 1st October, 1928. Although the parties are described in the document as lessor and lessee, the agreement was not, in our view, one of lease. Further, the agreement gave more than a mere licence, and it was not an agreement for the sale of earth and sand as chattels. In our view it was an agreement for the sale of an interest in immoveable property. A number of cases, which are not all easily reconcilable, have been cited to us on the question as to what constitutes an agreement for the transfer of an interest in land. In Marshall v, Green L.R. (1875) 1 C.P.D. 35 a sale of growing timber, to be taken away as soon as possible, was held not to be a contract for the sale of an interest in land. Brett, J., in that case laid down the following test:

If they (the things sold) are not fructus industriales, then the question seems to be whether it can be gathered from the contract that they are intended to remain in the land for the advantage of the purchaser, and are to derive benefit from so remaining; then part of the subject-matter of the contract is the interest in land, and the case is within the section (i.e., Section 4 of the Statute of Frauds). But if the thing, not being fructus industrialis, is to be delivered immediately. then the buyer is to derive no benefit from the land, and consequently the contract is not for an interest in the land, but relates solely to the thing sold itself. Here the trees were timber trees, and the purchaser was to take them immediately; therefore, applying the test last mentioned, the contract was not within the 4th section.

3. It was obviously with this authority before him that Collins, C.J., in the Full Bench case of this Court, Seeni Chettiar v. Santhanathan Chettiar I.L.R (1986) 20 M. 58 : M.L.J. 281 stated that it had long been settled that an agreement for the sale of growing timber, not made with a view to immediate severance from the soil and delivery as chattels, was a contract for the sale of an interest in land. Marshall v. Green L.R. (1875) 1 C.P.D. 35 was discussed and criticised by Chitty, J., in Lavery v. Pursell (1888) 39 Ch. D. 508 and the learned Judge points out that the decision turned on this, - that the Court considered that as the timber was to be cut down as soon as possible, and was immediately cut down, the thing sold was a chattel. In Lavery v. Pursell (1888) 39 Ch. D. 508 the contract was for the sale of a house as building materials, and it was held to be a sale of an interest in land; and Chitty, J., finds his conclusion thus:

I think that the contract does purport to confer on the purchaser the right to be there for the purpose of taking down and removing the materials, and does give him either a complete or a qualified possession; but still a possession of the soil itself--of the land, tenements and hereditaments; certainly of the whole of the house. That being so, if the question was free from authority, I should have thought that this case fell within the statute.

4. The learned Judge then proceeds to show that Marshall v. Green L.R. (1875) 1 C.P.D 35 was not an authority to the contrary. That reasoning and the conclusion appear to us to be exactly applicable to the agreement with which we are here concerned. Furthermore, the present case is really indistinguishable from Morgan v. Russell & Sons (1909) 1 K.B. 357 where it was held that an agreement to sell all the slag and cinders forming part of the soil on certain premises was a contract to grant an interest in land.

5. The agreement then, purporting to create an interest in immoveable property, and being unregistered, the question is whether Section 49 of the Indian Registration Act does not prevent the plaintiff from proving the terms of the agreement. The learned trial Judge has held that the equity of part perform ance established by Section 53-A of the Transfer of Property Act enables the plaintiff to enforce his rights under the agreement, notwithstanding that it has not been registered as required by law. It is unnecessary to consider the argument which has been addressed to us on the subject whether the learned Judge put a right construction on the section, because, in our judgment, the section has no application to an agreement to transfer immoveable property which, as in the present Case, was made prior to 1st April, 1930, the date on which Section 53-A is expressed as coming into force. Act XX of 1929, which introduced Section 53-A into the Transfer of Property Act, says that the Act, viz., the amending Act, shall come into force on 1st April, 1930, and the language of Section 53-A itself does not indicate an intention that it should come into force on any other date. But it has been contended, in view of the provision in Section 63 of the Act, that certain specified sections (which do not include Section 53-A) shall not affect the terms and incidents of transfers of property made prior to 1st April, 1930, that the inference is that Section 53-A was intended to have retrospective effect on ^transfers of property. Their Lordships of the Judicial Committee in Young v. Adams (1898) A.C. 469 have stated that retrospective effect ought not to be given to a statute unless an intention to that effect is expressed in plain and unambiguous language. Judged by that test, Act XX, in our opinion, fails to disclose an intention that Section 53-A was to have a retrospective effect. In support of the contention reference has been made to Act XXI of 1929, which is entitled 'An Act to supplement the Transfer of Property (Amendment) Act XX of 1929'. This Act is likewise expressed to come into force on 1st April, 1930. It does not amend Act XX, but it amends Section 49 of the Registration Act by enabling an unregistered document to be received as evidence of part performance of a contract for the purposes of Section 53-A of the Transfer of Property Act. Act XXI is supplementary of Act XX, and its provisions must be construed accordingly. And if, as we think, Section 53-A is applicable only to transfers of immoveable property made after 1st April, 1930, it must follow that the operation of the amendment made by Act XXI to Section 49 of the Registration Act should be similarly restricted.

6. Now, if the plaintiff cannot rely on Section 53-A the equity of part performance cannot help him. Although in Mahomed Musa's cases their Lordships of the Judicial Committee laid down that the equitable doctrine of part performance was applicable in India, their Lordships in the later case of Ariff v. Jadunath Majumdar held that the equity could not override the provisions of a statutory enactment. It is clear, therefore, upon this authority that the agreement of the 4th August being a document which required registration, is prevented by Section 49 of the Indian Registration Act (the amendment of this section by Act XXI of 1929 not being effective for the purpose of this case) from being received as evidence of any transaction affecting the property, and that no equitable doctrine can nullify the operation of the section. The words 'transaction affecting such property' in Section 49 have been held to mean transaction purporting or operating to create, declare, assign, limit or extinguish a right, title or interest in immoveable property: Saraswatamma v. Paddayya I.L.R. (1922) 46 M. 349 : 44 M.L.J. 45. To that extent, therefore, the unregistered document would not be receivable as evidence of its terms. The question, is whether the covenant that defendants would level plaintiff's land after removing the sand to the same level as adjacent plots operates to create or declare a right, title or interest in or to immoveable property. The covenant certainly operates to create a right in the plaintiff to have something done to his land, and an obligation on the defendants to do it. But we think that the right and obligation so imposed cannot be described in the ordinary sense of the words as 'a right, title or interest in or to immoveable property'. If this be the correct view, then the document is admissible to prove the terms of the covenant. The learned Counsel for the defendants has, however, contended, upon the authority of Sambayya v. Gangayya I.L.R. (1890) 13 M. 308 that the covenant is inseparable from the agreement and must stand or fall with it. But in that case the covenant was by the lessee to purchase the premises at the end of the term; it was clearly an agreement to create an interest in land. On the other hand, it is well settled that an unregistered document is admissible as evidence of a personal covenant or of a collateral transaction which does not require registration. It is to be observed that the covenant in question is not a repairing covenant. It did not require the defendants to restore the land after excavating the sand; but they were required to level the land to the level of adjoining lands so as to make it similarly cultivable. In our judgment the covenant was an arrangement collateral to the agreement, and one which did not affect the land within the meaning of Section 49.

7. There remains to be briefly noticed the contention that the defendants had admitted the terms of the covenant in their written statement. They admitted that the August agreement contained covenants, and they averred that they had fulfilled the covenants. But nowhere do they admit the terms of the covenant; they were not discoverable anywhere in the pleadings, and, curiously enough, the plaint makes no mention of the August agreement.

8. The result of our judgment is that although our reasons are different, our conclusion is the same as that reached by the learned trial Judge. Accordingly, the appeal fails and must be dismissed with costs. The learned Judge has assessed the plaintiff's damages at Rs. 3,000 for defendants' breach of their covenant to level his land. The plaintiff claimed Rs. 6,000. The only evidence given in the case on this subject was the plaintiff's who said that he thought the cost of levelling the land would be Rs. 5,000. The learned Judge made a personal inspection of the land but it was under water at the time so that the occasion was not favourable for testing the plaintiff's estimate of damage. Mr. Mockett has told us that defendants had witnesses to give evidence upon the question of damages, but that they were not called because the arguments were confined to the questions of law. In the circumstances, we think that defendants should have the opportunity of calling these witnesses and that the case should go back to the learned Judge for this purpose.

9. The question of costs at the trial will abide the result of the further enquiry by the trial Court into the question of what damages (if any) are payable by the defendants. There will be no refund of the Court-fee paid on the memorandum of appeal herein.


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