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Narendra Nath Acharjee and anr. Vs. Hirendra Nath Acharjee - Court Judgment

LegalCrystal Citation
Decided On
Reported inAIR1938Cal500
AppellantNarendra Nath Acharjee and anr.
RespondentHirendra Nath Acharjee
Cases ReferredDeo Nanda Prashad v. Janki Singh
- .....have appealed, and on their behalf the first contention advanced is that they are purchasers in a rent sale which has been confirmed. this is strenuously disputed by the respondent upon the ground that he was not a party either in the suit for rent or in the appeal from the order setting aside the sale. para. 4 of the plaint in the present suit contains a clear averment that the sale was not a rent sale, and prima facie this would seem to be so because the plaintiff had admittedly acquired the interest of some of the recorded tenure-holders by a purchase. in jitendra nath ghose v. man mohan ghose it was declared that their lordships of the judicial committee would presume, in the absence of evidence to the contrary, that the procedure laid down in sections 12 and 13, ben. ten. act was.....

Khundkar, J.

1. This appeal relates to the respondent's interest in a certain tenure recorded as a permanent tenure liable to enhancement of rent. The names of the recorded tenure-holders at a time which is material were : (1) Kedar Acharjee, (2) Chandi Charan, (3) Sashi, (4) Bejoy, (5) Khoka, and (6) Sailen. In the year 1920 the interest of Sashi, Bejoy, and one Kali, who was the father of Khoka and Sailen was purchased by one Manindra Kumar Basu at a sale held in execution of a mortgage decree. Manindra got himself recorded as a tenure-holder and then on 26th January 1931 sold his interest to the present respondent. On 14th April 1931, the landlords instituted a suit for rent and obtained a decree against Kedar, Chandi Charan, Sashi, Bejoy, Khoka and Sailen without impleading either Manindra or the respondent as defendants. In the petition for execution it would seem that only Kedar, Kedar's wife Giribala, and Chandi Charan were made parties. In execution of the decree obtained in that suit the tenure was purchased on 9th April 1934 by the present appellants who are the sons of Kedar. Thereafter the judgment-debtor, Chandi Charan, applied under Section 174 (3), Ben. Ten. Act to have the sale set aside. In this proceeding, a compromise was mooted in which the respondent came forward and offered to join. It is significant that he was permitted without any objection to become a party and a compromise petition was filed whereby it was agreed that on payment of certain sums to the landlords and to the auction-purchasers within a specified time, the sale would be set aside. The entire amount was however not deposited within the time agreed, and an application for an extension of time was made which was allowed. The balance of the stipulated amount was then paid and the sale was set aside.

2. Against this order the auction-purchasers appealed, but in their appeal they did not implead the present respondent although the order setting aside the sale was one by which he had clearly benefited. At the hearing of that appeal the judgment-debtor pointed out that the matter could not be disposed of in the absence of the present respondent who was a party to the compromise, but this objection was overruled. The appeal was allowed and the sale was confirmed. The respondent then filed the suit out of which the present appeal has arisen for declaration of title, confirmation of possession and a perpetual injunction. The suit was dismissed by the trial Court, but was decreed on appeal. Against that decision the auction purchasers have appealed, and on their behalf the first contention advanced is that they are purchasers in a rent sale which has been confirmed. This is strenuously disputed by the respondent upon the ground that he was not a party either in the suit for rent or in the appeal from the order setting aside the sale. Para. 4 of the plaint in the present suit contains a clear averment that the sale was not a rent sale, and prima facie this would seem to be so because the plaintiff had admittedly acquired the interest of some of the recorded tenure-holders by a purchase. In Jitendra Nath Ghose v. Man Mohan Ghose it was declared that their Lordships of the Judicial Committee would presume, in the absence of evidence to the contrary, that the procedure laid down in Sections 12 and 13, Ben. Ten. Act was duly followed, and that the proper statutory notice was given to the landlords of incumbrances and sales. Had the appellants invoked the provisions of Section 146-A, Ben. Ten. Act, they might perhaps have been able to show that the entire body of co-sharer tenants in the tenure was represented by the persons whom the landlords had impleaded as defendants in their suit for rent. This they did not at-tempt to do either in the suit or in first appeal. They however now contend that the defendants in the landlord's suit must have fallen within one or other of the descriptions contained in Clauses (i) to (iv) of Sub-section (3) of Section 146.A, Ben. Ten. Act. Had that been their contention in the Courts below, the plaintiff, respondent would have had an opportunity of showing that the defendants in the landlord's suit did not satisfy any of those descriptions. The appellants not having invoked the provisions of Section 146-A in the Courts below, the materials now upon the record are not such as to enable me to say that the entire body of tenants was represented in the landlord's suit for rent. In the circumstances established, I must hold that the decree obtained by the landlords is not shown to have been a rent decree. The defence which the appellants actually put forward in the Courts below, and which they also raised in this appeal, was based upon the fact that the respondent had joined in the compromise and had submitted to its terms. To put it shortly, their case was and is, that the respondent, by participating in the compromise, had recognized the decree obtained by the landlord as a rent decree, and he is accordingly estopped from disputing its character as such. In this connexion it is pointed out that the compromise petition describes the respondent as a judgment-debtor. In support of the argument reliance has been placed on the following decisions.

3. In Rajunder Narain Rae v. Bijai Govind Singh (1837-41) 2 MIA 181 (PC), it was held, that a deed of agreement to compromise conflict-ing claims entered into in the presence of witnesses and solemnly acknowledged in Court, by parties who were mutually ignorant of their respective legal rights, cannot afterwards be set aside upon the plea of ignorance of the real facts when the party seeking to avoid the deed had the means of ascertaining those facts within his reach. The principle enunciated in this decision is not in question in the present matter, because it is nobody's case that any of the parties here were acting in ignorance of their legal rights. In Uttam Chandra v. Khettra Nath (1902) 29 Cal 577 compromise petition was filed in a proceeding to set aside a sale, whereby the judgment-debtor, bound himself to pay up the full decretal amount by a certain date. It was agreed that if this was not done the sale should stand good. The entire amount not having been paid by the specified date, the judgment-debtor, in spite of opposition by the decree-holder, obtained an extension of time to pay the balance. When this was tendered the decree-holder refused to accept it. It was held that the judgment-debtor was bound by the terms of the compromise, and was estopped from contesting the validity of the sale. The facts of the present appeal are undoubtedly somewhat similar but in the case cited, the order confirming the sale was made in a proceeding to which the judgment-debtor was a party. Moreover, in the case cited the judgment-debtor was held to have been estopped from con. testing the validity of the execution sale. In the present case it is contended that he is estopped not only from that, but also from challenging the character of the decree itself, which is a very different matter. In Mt. Kunti v. Gajraj Tawari (1924) 11 AIR All 826 it was laid down that when parties agreeing not to go to law and not to fight out their disputes, by a mutual arrangement carry into execution their mutual promises, so that the original contract by which they decided to terminate the disputes becomes an executed contract on both sides, and nothing remains to be done, the parties continuing each in the enjoyment of the interest which the other agreed that he should take, the Courts in India applying the rule of equity and good conscience, will not permit either party who has bound himself by the contract and by its performance to repudiate what he has done, and will also prohibit any person claiming under him from attempting the same thing.

4. This decision relates in terms to the legal consequences of a contract by which the parties thereto have bound themselves not to go to law, and which has been acted upon, and the principle to which it gives expression is too well-known to need elaboration. The question which has to be determined in the present appeal, is, whether from the decision to which reference has been made, it is possible to extract a rule which will estop the respondent from denying that the appellants have obtained this tenure in a rent execution sale. Now as already stated, the respondent was not impleaded as a party in the landlord's suit for rent. During the execution proceedings he voluntarily came forward and offered himself as a party to a compromise the sole object of which was to prevent the tenure from being sold. True it is, that he allowed himself to be described as a judgment-debtor. But this presumably he had to do in order to acquire locus standi as a party to the compromise. Can it be said that he thereby surrendered for all time, and in all circumstances, his right as a purchaser, of saying that the landlord's decree did not affect his interest since it was passed behind his back? I think not. The compromise was effected in execution proceedings, and it was clearly outside the scope of those proceedings for any person described as a judgment-debtor to question the character of the decree. Moreover, the respondent was agreeing to no more than this, that the sale under the decree, such as it was, would stand if money was not paid in time. This would not alter the legal incidents of the sale so as to transform what was really a money sale into a rent sale. The respondent saw in the compromise only a convenient gateway out of unnecessary turmoil. Had he successfully escaped from turmoil, and acquired any benefit through or under the compromise, equity might bar him now. But the position was otherwise. The sale was at first set aside by an order passed in his presence. The case was later confirmed by an order passed in his absence. If estoppel there was, it seems to me arguable that it operated also against the appellants. They as auction purchasers had in the compromise agreement recognized the respondent as one occupying the status of a judgment-debtor in the execution proceedings. Yet in an appeal which they took from an order subsequently passed in those execution proceedings they threw the respondent over board and omitted to implead him as a party.

5. In view of the limitations under which the respondent lay in the matter of the compromise, as well as in the appellants' appeal against the order setting aside the sale, it is not possible to say that the respondent is estopped from impugning the character of the landlord's decree. There is one other matter to which reference may be made. The lower Appellate Court has held as a fact that the appellants were mere benamidars of their father Kedar, and on this finding has rightly concluded, that their purchase was voidable under Section 173 Sub-section (1), Ben. Ten. Act, but not void. On behalf of the respondent I have been invited to hold that the purchase by the appellants falls within Section 88, Trusts Act, and inures to the benefit of the respondent, and the case in Deo Nanda Prashad v. Janki Singh (1916) 3 AIR PC 227 has been cited in this connexion. Kedar, merely because he was a co-sharer in the tenure, does not, in my judgment, come within the language of Section 88, Trusts Act, as a 'person bound in a fiduciary character' to protect the interests of the respondent. It seems to me that in a case where Section 88, Trusts Act, does not in terms apply, the entire circumstances of the transaction have to be looked at for the purpose of determining whether an interest acquired by one person is an advantage which he may not be permitted to hold to the prejudice of another. In the case cited, an interest in a revenue paying estate was subject to a usufructuary mortgage in favour of a person who undertook to pay the Government revenue for the mortgaged share. A default in such payment having occurred, the property was put for sale and was purchased benami for the mortgagee. It was held that as the mortgagee had a duty to perform which was inconsistent with his becoming a purchaser in the way he did, his title could not operate to the exclusion of his co-owners, who were entitled to equitable relief. The case is distinguishable, because the tenant defendant Kedar in the landlord's suit lay under no contractual obligation to save the tenure from sale. This branch of the argument, if it helps the respondent at all, does so by bringing into further relief the equities in his favour. Upon a consideration of the proved facts and entire circumstances of the case, I am constrained to hold that the execution sale which was confirmed as a consequence of the auction-purchaser's appeal passed the right, title and interest of only those tenants who were impleaded in the landlord's suit. This appeal must be dismissed with costs, and the decree of the lower Appellate Court made in the respondent's favour must be upheld. Leave to appeal under Section 15 of the Letters Patent is asked for and is refused.

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