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Mohammed Ali Khan Vs. Kanailal Haldar and ors. - Court Judgment

LegalCrystal Citation
Decided On
Reported inAIR1935Cal625,159Ind.Cas.767
AppellantMohammed Ali Khan
RespondentKanailal Haldar and ors.
Cases ReferredNarayan Swami Ayyar v. Rama Ayyar
- 1912 there was a suit for partition between satya and sushila as the result of which the land in suit fell to sushila's share. in july 1918 sushila contracted a loan of rs. 1,000 by executing a mortgage of a plot of 1 1/2 cot. of land in tollygunge in favour of one jitendra. mohan banerjee alleging that the money was required for performing the sradh of her husband and of her son at gaya. on 14th november 1919 she granted a lease of the land in suit in favour of one ram sashi chaudhury on taking a selami of rs. 1,000 for a term of 99 years at a yearly rental of rs. 100 and stipulating that the lessee would have the option of renewing the lease for 99 years at the rate of rent prevailing at the time of such renewal. as regards the necessity for the lease the following recital.....

1. This appeal has arisen out of a suit for declaration of plaintiffs' title and for recovery of possession in a plot of land 3 bighas 6 cot. 12 ch. 29 sqr. feet in area in Tollygunge in the suburbs of Calcutta. The two plaintiffs are sons of one Satya Charan Haldar. Satya's mother and Sushila Devi were the two wives of one Nagendra who had by the latter another son named Sailendra. Sailendra died unmarried leaving Sushila as his heir. The plaintiffs as reversioners on the death of Sushila instituted this suit on the allegation that Sushila with a view to injure the reversionary interest of Satya, with whom she was on terms of bitter enmity, had granted a lease in respect of the property of which the defendants are the present holders.

2. The history of the lease is as follows: Sailendra died in 1907 and thereafter in 1912 there was a suit for partition between Satya and Sushila as the result of which the land in suit fell to Sushila's share. In July 1918 Sushila contracted a loan of Rs. 1,000 by executing a mortgage of a plot of 1 1/2 cot. of land in Tollygunge in favour of one Jitendra. Mohan Banerjee alleging that the money was required for performing the Sradh of her husband and of her son at Gaya. On 14th November 1919 she granted a lease of the land in suit in favour of one Ram Sashi Chaudhury on taking a Selami of Rs. 1,000 for a term of 99 years at a yearly rental of Rs. 100 and stipulating that the lessee would have the option of renewing the lease for 99 years at the rate of rent prevailing at the time of such renewal. As regards the necessity for the lease the following recital appears in the documents:

At present there having arisen difficulty in the realization of rents from the tenants, and having been in need of money for the performance of Sradh of my late son Sailendra at Gayadham and for performance of duties for the spiritual benefits of my late husband and son, I on lawful grounds, took loan of Rs. 1,000 from Sreejut Jitendra Mohan Banerjee by executing a registered mortgage bond. And there is no possibility for the clearance of the said debt out of my present income. As the mortgagee is about to sue me for his dues and there is the possibility of my valuable properties being sold away on account of the suit aforesaid and for the improvement of the land given in the schedule below, which has got ditches in many places and as the land given in the schedule below is of small value, it is necessary to pay off the debt by letting it out on lease for a long term and to make improvement of the said land.

3. Ram Sashi Chaudhury had taken the lease on behalf, and in the interest of some Englishmen. He transferred the property to the Bombay Industrial Trust who did some work of improvement on the land after the transfer. The trust however was wound up, and before they did so they assigned the lease over to defendants 1 and 2 for a consideration of Rs. 8,000 on 21st April 1928. These defendants are said to have sublet portions of the land to the other defendants in the suit, and defendant 1 has erected a building on a small area out of it. The plaintiff's father Satya died in January 1926, Sushila died in April 1926. The present suit was instituted on 19th September 1928. An injunction was applied for to restrain the defendants from erecting the building, but as the building, the construction of which was said to have been going on, was very nearly complete and as it did not appear that any other construction was contemplated, the injunction was not granted. The defence was that the mortgage and the lease were justified on the ground of legal necessity and that defendants 1 and 2 were bonafide assignees of the lease and had acted in good faith. The Subordinate Judge having decreed the suit, defendant 1 has appealed.

4. The Subordinate Judge has gone minutely into the evidence which was adduced to show the financial condition of Sushila Devi since her husband's death. He has found that her income from the landed properties could not have been less than Rs. 83, and from her turn of worship at the Kalighat Temple not less than Rs. 200. per year. Some argument has been addressed to establish that these amounts have been assessed at figures too high, but we are not satisfied that the Judge has been in error. But even if occasional falling off of the income is to be taken into account, the figure would always remain much higher than Rs. 100 which has been found as the total amount of her monthly expenses. There is evidence which the Judge has believed and which we see no reason to disbelieve that she never felt the pinch of want, and that she used to carry on, on a small scale a business in lending money on pledge. In addition to what has been stated so far, she had in deposit with a gentleman a sum of Rs. 5,500 which she had got as owelty money on partition and which was to bring her Rs. 330 per year as interest. Whether she got this interest regularly or not is not certain. But she had also other money in deposit in connection with certain Land Acquisition Cases in the Court of 24 Perganas and also in the Improvement Trust Tribunal. Out of the deposit in the Court of 24, Perganas she had drawn Rs. 4000 in 1915 for her daughter's marriage. The interest she was receiving on account of the deposit in that Court aggregated to about Rs. 150 a year. The Improvement Trust deposit gave her a yearly interest of Rs. 271-10-4.

5. With the above facts in mind, we have, in the first place to consider the validity of the mortgage she executed in 1918. The learned Judge has said that just a few days before the mortgage she had withdrawn Rs. 224 as interest from the Court of 24 Perganas. This statement is wrong, for the amount so withdrawn was about Rs. 80 or so. He is also wrong in the date that he has given of the satisfaction of the mortgage-an error which has led him to draw an erroneous inference. He has also been incorrect in giving certain other figures as of amounts which were available to her at the date of the mortgage. But discarding all these matters there is the fact, which strikes one at the outset, namely that there was a huge sum of money in deposit in the Court of 24 Perganas and in the Improvement Trust Tribunal, out of which on a proper application being made and on a ground of justifying necessity being made out a small sum of Rs, 1000 could have been easily obtained. No such course was adopted; and obviously, for the reason that she was not prepared to face an inquiry. There is evidence which stands unchallenged that she was on terms of hostility with Satya and was for that reason living away from the family dwelling house and in a house rented for herself and her son. The reason given for the mortgage was that money was needed for the expenses of the Sradh at Gaya. It has not been shown that the money raised was so spent; a matter which is important, because though of course the mortgagee is not bound to see to the application of the loan, the fact that the money was in fact so spent would have gone a long away to establish the truth of the allegation as to necessity. The evidence, such as it is, on the question of the actual receipt on her part of the consideration for the mortgage, is extremely unsatisfactory. The learned Judge has, on an examination of the evidence as regards the mortgage, expressed himself thus:

The mortgagee Jitendra hails from Kandi within the District of Murshidabad, and he has not been called as a witness, and it has not even been suggested that he is no longer in the land of the living and that his evidence cannot be procured. The scribe Satish comes from Kidderpore while the transaction took place at Kalighat. No light has been thrown to dispel the suspicion that naturally arises out of these circumstances regarding the bonafide of the mortgage. Tarakdas Babu, pleader, examined on the side of the defendant, is no doubt a witness to the mortgage, but he was positive that no consideration was paid in his presence. His evidence instead of furthering the case of the defendant deepens the suspicion that the transaction embodied in the mortgage was not straight.

6. We are unable to dissent from the view which the learned Judge has taken.

7. Then comes the lease. The ground of necessity recited in it are: (1) satisfaction of the mortgage debt which was imperative because a suit was about to be instituted; and (2) improvement of the property which was fetching no appreciable income and was infested by tenants who were undesirable. As regards (1) there is really no evidence that there was any apprehension of any suit being instituted at the time or that the estate was in fact in jeopardy. And as regards the satisfaction of the mortgage, the endorsement itself is somewhat curious because it says that there had been a previous payment of Rs. 50 presumably on account of interest, and now Rs. 1,000 was paid on deduction of remission. The pleader Babu Tarakdas Mukherjee who wrote the endorsement has not deposed to the payment itself. Lalit Mohan Adhikari who signed as a witness to the payment has not been examined; Satish who signed for the mortgagee Jitendra has not been called. As regards (2), it is quite true that the rent which the property was fetching was insignificant and the tenants were people who were not desirable as tenants. But we are unable to hold that the lady really made up her mind to effect an increase in the income and for that purpose granted the lease. If she was acting bona fide she would have made an estimate as to what it would cost her to get rid of the tenants, to fill up the ditches and open up roads, and she would then have tried for a lease of the property on reasonable terms. There is no evidence of any such bona fides on her part in entering into the present transaction by which she granted a lease for 99 years, at a yearly rent of Rs. 100 with an option on the part of the lessee to get a further lease for 99 years at such rate of rent as would be prevailing at the time of renewal.

8. It was stated in the document that the tenants on the property were all tenants at will. If that was so, or if, as the evidence shows, only Rs. 2,000 had in fact to be paid to the tenants to get them to vacate, it is not easy to understand why instead of spending that amount herself she granted the lease to Ram Sashi Chaudhury on such terms. Of course, the lessee was also expected to spend money in making improvements, but the terms of the lease indicate that it was entirely at his option to make or not to make any improvements. All the benefit that the lady secured for herself and for the reversioners by the transaction was a rent for 99 years at the rate of Rs. 100 per year and a liability to be kept out of the property for a further period of 99 years in lieu of the rent at a rate which would be regarded as the prevailing rate at the time of the renewal. If she really wanted to have some improvements effected on the property itself one would have found some obligations in that respect imposed upon the lessee by the terms of the lease. The terms of the lease to our mind, indicate that some speculators finding the property in her hands approached her or were brought into touch with her and she herself being only too willing to spite the reversioners the bargain was closed. An endeavour has been made in the evidence to show that there were idgas and dargas on the land and some correspondence has been put in to establish that there was considerable difficulty in ejecting the tenants. But the learned Judge, was right in appreciating the real effect of that oral and documentary evidence. After all, as the learned Judge has observed, the tenants got a small compensation each and left without demur. Such evidence as there is of the value of land near about the land in suit sufficiently shows that the lease that was granted was a most improvident arrangement.

9. The position therefore is that there was no legal necessity for the lease: firstly because the mortgage itself for satisfaction of which it was granted was not a transaction which, even if real, was supported by justifying necessity; and secondly because there was no real intention on the part of the lady to benefit the estate which, if she had, she would not have entered into an improvident transaction of this description. Her motive and intention, as far as we can judge, were to secure for herself a yearly sum of Rs. 100 as rent, and to deprive the reversioners of the property itself for a period of 99 years in lieu of a like amount yearly and possibly also for a further term of 99 years in lieu of rent at such rate as would be found to be the prevailing rate at the term of the renewal.

10. A number of decisions, in which transactions by which a Hindu widow disposed of her husband's property in due course of management have been upheld by the Courts, have been cited. Daya Moyi Debi v. Srinibash Knndu (1906) 33 Cal 842 was a case in which Maclean, C.J., after referring to the paucity of authority on the question and relying upon the principles laid down by the Judicial Committee in Hanooman Prasad Panday v. Babover Munraj (1854-57) 6 MIA 393 and Kameswar Prasad v. Run Bahadur Singh (1881) 6 Cal 843 upheld a permanent lease which was found to have been granted for the benefit of the estate and which was also found to have benefited the reversioners. In Shankar Nath v. Bijay Gopal (1909) 13 CWN 201 a lease for 60 years was upheld on the ground that it was a beneficial family arrangement and considered beneficial and accepted as such by the widow's principal opponents. This decision was upheld by the Judicial Committee in Bijoy Gopal Girindra Nath, 1914 PC 128 their Lordships holding on the facts that the arrangement was made in good faith and was one dictated by the necessities of the case, that the choice of the term of 60 years was for the benefit of the estate, and that the arrangement having received the sanction of the expectant reversioners afforded evidence that it was made under circumstances which the Hindu law would regard as valid on the ground of necessity. In Ram Sumran Prasad v. Shyam Kumari, 1922 PC 356 their Lordships of the Judicial Committee upheld a compromise entered into by a Hindu widow bonafide for the benefit of the estate and not for her personal advantage as being justified by necessity observing that 'necessity does not mean actual compulsion, but the kind of pressure which the law recognises as serious and sufficient.'

11. On these authorities an abstract question of law has been argued namely whether a transaction, by which a loan is raised for effecting improvements on a property by getting rid of bad tenants, filling up ditches, opening roads and erecting structures and in similar other ways can be justified. In the view of the facts of this case and of the nature of the present transaction the question does not really arise. But if it does it may be answered that the expression 'benefit of the estate' as used in decisions with regard to circumstances justifying an alienation by a limited owner cannot be precisely defined, but it may be taken as including the preservations of the estate from extinction, its defence against hostile litigation, its protection from inundation, and similar circumstances: Palaniappa Chetty v. Deivasikamony Pandara, 1917 PC 33. Therefore, benefit, in which no idea of protection or preservation but only an idea to improve so as to increase the income is included, would not be sufficient by itself to make the transaction binding on the reversioner.

12. In the Court below as well as in this Court an endeavour was made on behalf of the appellant to support the lease, in so far as the defendants now purport to hold under it, on the ground that proper enquiry was made and the assignment was taken in good faith. (But after examining the evidence his Lordship held that no protection could be pleaded on the strength of the enquiry). Estoppel has been pleaded, but we do not see that the circumstances were such as would create any estoppel as against the plaintiffs. Their cause of action accrued only on Sushila's death, when the plaintiffs were minors and one of them has attained majority some time after the suit was instituted. The plea of estoppel rests upon two facts, namely, that there was a notice board put up on the property which showed that the land was to be sublet, and that the building was being openly constructed and the plaintiffs had knowledge of such construction. These facts without anything more, and there is nothing more to which the appellant can point in this connexion, do not create any estoppel as against the plaintiffs.

13. In such circumstances, there can be no question that the plaintiffs' title should be declared. But the question is what is the decree that should be passed as regards their prayer for possession. This question will have to be decided in the light of the principle of equity which has received statutory recognition in Section 51, T.P. Act; though there are difficulties in applying the section itself in view of its terms to the present case. The section speaks of a person absolutely entitled to the property in respect of which eviction is sought for; and therefore it may not unreasonably be contended that the case of a lessee holding under a lease of the present nature is outside the contemplation of the section: see Rajrup Kunwar v. Gopi, 1925 All 261. But the principle contained in the section has often been applied to lessees who are sought to be ejected, and we see no reason why the principle should not be applied in the present case. It is true that absence of proper enquiry condemns a bargain as one not made in good faith. But any and every negligence does not show want of good faith. As was explained in Nanjappa Gounden v. Peruma Gounden (1909) 32 Mad 580, good faith within Section 51, T.P. Act, is not necessarily precluded by facts showing negligence in investigating the title. In view of all the circumstances of the case, we have come to the conclusion that though the transaction itself under which the appellant came to acquire the leasehold cannot be upheld, there are enough grounds on which it should be held that he believed that he had acquired a good title. We therefore think we shall be justified in taking into account the equities that are in his favour.

14. That in such a case such equities may be taken into account is sufficiently established by the decision of the Judicial Committee in Narayan Swami Ayyar v. Rama Ayyar, 1930 PC 297. In restoring the land to the plaintiffs we must distinguish between improvements effected on it which are inseparable from the land itself, and such structures, etc., as may also have been erected upon it but are removeable. As regards the improvements there is some evidence in the shape of bills showing that Rs. 2,000 had been spent for clearing the property of tenants and Rupees 11,000 for opening up roads and filling ditches. These expenses are said to have been made by the Bombay Industrial Trust. So far as the latter amount is concerned there is hardly any satisfactory evidence as regards the work that was in fact done or what the real value of such work was. Any way, the appellant can have no equity in his favour except on the basis of the figure of Rs. 2,000 which is the amount he had to pay for the assignment of the lease in his favour, in addition to Rs. 1,000 which he had to pay because it was the premium for the original lease. The appellant therefore is entitled to be reimbursed to the extent of Rs. 2,000. So far as the structures erected by the appellant are concerned they do not go with the land. The plaintiffs are not bound to take the land burdened with them and the appellant is entitled to remove them if he likes. But we think he is also entitled to ask us to make an order that the plaintiffs be called upon to sell their interest to him in respect of the land on which he has erected his dwelling house. We asked his learned Advocate whether he would like to have an order of the last mentioned description and he has answered in the affirmative. (His Lordship then passed a suitable decree modifying the lower Court's decree).

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