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Debendra Nath Chowdhury Vs. Southern Bank Ltd. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKolkata High Court
Decided On
Case NumberAppeal No. 174 of 1957
Judge
Reported inAIR1960Cal626,64CWN439
ActsCode of Civil Procedure (CPC) , 1908 - Order 2, Rule 2
AppellantDebendra Nath Chowdhury
RespondentSouthern Bank Ltd.
Appellant AdvocateKanti Bose, Adv.
Respondent AdvocateE.R. Meyer and ;S. Roy Choudhury, Advs.
DispositionAppeal allowed
Cases Referred and Provash Chandra Sinha v. Ashutosh Mukherji
Excerpt:
- .....of a contract to execute a document of transfer is not a cause of action for possession of land. possession only is consequential and the right to the same arises by virtue of the execution of the document of transfer and not before. in our opinion, the madras decision in ilr 38 mad 698: (air 1914 mad 465) is the correct view. it may be observed here that mahajan, j. in his dissentient judgment in 1949-50 fcr 849 at p. 947: (air 1950 fc 83 at p. 120) expressed the view that a suit by a purchaser for specific performance even with a prayer for possession is not a suit for land within the meaning of clause 12 of the letters patent. a suit by a vendor against the purchaser for specific performance of a contract for sale of land was held in land mortgage bank v. sudurudeen ahmed ilr.....
Judgment:

P.B. Mukharji, J.

1. Courts in India have been laboriously cultivating 'land' in the field of Clause 12 of the Letters Patent of the Chartered High Courts. Long and deep are the judicial furrows. Rich is the harvest. No judicial Ricardo has been able to discover any law of diminishing return in this area. The crop of judicial decisions is abundant and varied to suit every legal taste. In this appeal some examination of this harvest is inevitable before a decision can be reached.

2. The simple question in this appeal is whether a suit for specific performance of a contract is a 'suit for land' when the subject-matter of the contract is 'land'. On the soil of Clause 12 of the Letters Patent of this High Court, this simple question, however, has many complicated traditions.

3. This is an appeal from the judgment of G.K. Mitter, J., dismissing the plaintiff's suit for specific performance of an agreement to grant a sub-lease of fire-clay lands in Santhal Pargannas outside the jurisdiction of this Court. The plaintiff claims jurisdiction on the ground that the defendant, a Limited Company, has its registered office and carries on business at 24, Netaji Subhas Road, Calcutta, within the Original jurisdiction of this Court. The specific prayers in the plaint is for a decree directing the defendant to execute and register the sub-lease, and in default, directing the Registrar of this Court to execute the sub-lease on behalf of the defendant. No other reliefs are claimed except damages. No possession of the lands is claimed in this suit.

4. Following a previous judgment of his own in Sm. Bimal Kumari v. Asoke Mitra, : AIR1955Cal402 the learned Judge dismissed the suit on the preliminary point that the Court had no jurisdiction to try the suit because specific performance of the agreement involved the delivery of possession of land situated outside the jurisdiction of this Court. That was a suit for specific performance of an agreement to purchase lands situated outside the jurisdiction of this Court. That decision was based on the learned Judge's observation in that case to the following effect:

'The two obligations which the Vendor is bound to discharge, arise at one and the same time, viz., to execute the conveyance and to deliver possession. It was suggested that the case was covered bySection 16 of the Specific Relief Act, inasmuch as it should be held that a part of the contract, viz., that relating to delivery of possession stood on a separate and independent footing from the other parts of the contract'.

5. The learned Judge applied those observations to the facts of the present case. He came to the conclusion that the sub-lease dated 18-3-1948 in favour of Sudhir Ranjan Dutta in this case shows that not only had the Bank to execute and register the lease in favour of the plaintiff but simultaneously therewith deliver possession of the land to the plaintiff and, therefore, the claim for execution of a sublease could not be separated from the claim, for delivery of possession. This suit was decided without taking any evidence. This sub-lease in favour of Mr. Datta has not been made a formal exhibit in this suit. The only document on the record is the Agreement, dated 12-8-1949 for which specific performance is claimed. The relevant facts as appearing in Clause 13 of this Agreement may be briefly set out for appreciating and determining the point in issue.

6. By a Bengali deed of lease dated 27-8-1941 between Rani Brojo Bala Devi of Hetampur and the defendant, a lease of fire-clay land for 15 years from 27-8-1941 was granted to the defendant. By a Bengali deed of sub-lease, dated 18-3-1948 the defendant granted to Sudhir Ranjan Datta a sublease of the said land for three years from 8-3-1948. Then by this agreement in writing dated 12-8-1949, the defendant agreed to grant to the plaintiff a sublease of the said land upon the expiry or sooner determination of the said lease in favour of Sudhir Ranjan Datta for the unexpired portion of the term of the lease, dated 27-8-1941 on the same terms and conditions as in the sub-lease in favour of Mr. Datta at a selami of Rs. 2,000/- payable to the defendant. This agreement was registered on 13-8-1949. The sub-lease in favour of Mr. Datta was determined on 17-10-1950. It is this agreement in writing, dated 12-8-1949 which the plaintiff wants to specifically enforce by this suit,

7. The appellant attacks the judgment on two grounds. It is first contended that no possession was sought in the suit and therefore the learned Judge was wrong in applying the decision in : AIR1955Cal402 to the facts of this case. He relied on the decision of Shib Kumar Banerjee v. Rasul Bux : AIR1959Cal302 . The learned Advocate for the appellant contends that a purely personal order to execute the sub-lease is sought in this case and as the person, who is the defendant company, is within the jurisdiction of the court, this Court can and should make an order upon the defendant to execute the sub-lease. Lastly, it is contended that the nature of a suit for specific performance of an agreement to grant him a sublease brought by the intended lessee is not a suit for land within the meaning of Clause 12 of the Letters Patent. These arguments deserve careful consideration. The Appellant relied on the decision of a single judge of this Court in : AIR1959Cal302 .

8. I shall take up the last point first. This point is not res Integra. Gentle, J. in Probodh Kumar Das v. Dantmara Tea Co., Ltd., ILR (1947) 2 Cal 113comes to the conclusion that both the Indian and the English Courts can pass a decree which operates in personam upon the individual requiring him to do or to abstain from doing some specified act provided. the party is within its jurisdiction so that the Court can enforce its decree. In that case the learned Judge held that a claim by a purchaser against a vendor for specific performance of a contract for the sale of land was not a suit for land within the meaning of Clause 12 of the Letters Patent and this Court had jurisdiction to entertain such a suit even though the land was situated outside the local limits of the Ordinary Original Civil Jurisdiction of this Court. Almost all relevant authorities on this point were carefully analysed by Gentle, J. in this decision and the conclusion the learned Judge reached was also supported by the most careful and elaborate scrutiny of not only the Indian Law but also the English law and the English practice. Das, J. in Sm. Khatun Bibi v. Sm. Lilabati Dassi, 49 Cal WN 80 held that the expression 'suit for land' in Clause 12 of the Letters Patent of the Calcutta High Court in its true meaning covered only a suit for recovery of land and a suit whether by the purchaser or by the vendor for specific performance simpliciter of a contract made within the Original jurisdiction of the Court for sale of land outside the jurisdiction, was not a suit for land so understood. It was held in that ease that the High Court had jurisdiction to entertain in its Original Side such a suit for specific performance but when in a suit the plaintiff also asked for recovery of possession, it became a suit for land and the Court would then have no jurisdiction to entertain such suit. This decision in Khatun Bibi, 49 Cal WN 80 discusses at length much of the case law on the point and traces the legal history of the Charter and the Letters Patent of this Court which it will therefore be unnecessary for us here to recapitulate.

9. The Privy Council decision in Rangayya Gounclan v. Nanjappa Rao, 28 Ind App 221 (PC), holding that a subsequent suit by purchasers against vendors for specific performance of their agreement where both parties had previously sued, praying relief only as regards possession of the property sold or compensation for its disturbance, and omitting to seek the relief of specific performance, was not maintainable under Section 43 of the then Civil Procedure Code, is not relevant for the decision on the point in this appeal. Nor is the Privy Council decision in Sundar Singh Mallah Singh Sanatan Dharam High School, Trust Indaura v. Managing Committee Mullah Singn Rajput High School, Indaura relevant on the point in this appeal, because there all that the Privy Council holds is that where the defendant was not in possession or was in a position to deliver possession, and where no 'further relief than a declaration of the right to possession was available to the plaintiff, the proviso to Section 42 of the Specific Relief Act precluding the grant of a declaration where the plaintiff being able to seek further relief omits to do so, does not prevent granting such a declaration.

10. The Special Bench decision of this Court in Maharaja Probirendra Mohan Tagore v. State of Bihar, : AIR1959Cal767 , which has been cited at the Bar before us discussed the expression 'suit for land' in Clause 12 of the Letters Patent. Itproceeded to lay down that the primary object of the 'suit should be the determining factor for this purpose. That Special Bench decision however did not discuss on the basis of that 'primary object' test, the nature and character of a suit for specific performance and the decision of this and other courts on that point. The whole controversy in this appeal is whether a suit for specific performance of what is known as a contract can be regarded as a suit for land, when land is the theme of the contract. The Special Bench however referred to the Federal Court decision in Moolji Jaitha and Co. v. Khandesh Spinning and Weaving Co. Ltd. 1949-50 FCR 849: (AIR 1950 FC 83). This Federal Court authority discusses the nature of suits for specific performance and in our opinion supports the view that we are taking in this appeal. It will, therefore, be necessary to analyse this Federal Court decision to find its ratio.

11. Kania, C. J. in the Federal Court observes that the test for determining whether a suit is a suit for land within Clause 12 of the Letters Patent is, whether taking the suit as a whole, it is for the purpose of obtaining a direction for possession or a decision on title to land, or the object of the suit is something different and involves the consideration of the question of title to land indirectly. The learned Chief Justice of the Federal Court makes it clear that the equitable principle on which English Courts have granted reliefs to litigants in respect of lands situate outside the jurisdiction of the Court are applicable to the High Courts in the Ordinary Original Civil Jurisdiction. In fact his Lordship goes further to say that there is nothing in Clause 12 of the Letters Patent to exclude such equity jurisdiction nor is this jurisdiction confined to the cases of express trusts. Kania, C. J. held that approaching the question in the light of these equitable principles, the plaintiff there was entitled to ask the court to act in personam and direct the defendant to execute a conveyance in favour of the plaintiff. Kania, C. J. even observed that the addition of a prayer for declaration of title did not alter the nature of the suit for specific performance or oust the jurisdiction of the Court to act in personam. These observations of the learned Chief Justice of the Federal Court will be found at pages 856-57 and 864-65 (of FCR): (at pp. 86 and 89 of AIR).

12. Patanjali Shastri, J. in the same Bench of the Federal Court also took the same view. After referring to the judgment of the Full Bench of seven Judges of the Bombay High Court in Hatimbhai v. Framroz ILR 51 Bom 516: (AIR 1927 Bom 278) and to the judgment of the Full Bench of five Judges of the Madras High Court in Villiappa Chettiar v. Govinda Dass ILR 52 Mad 809: (AIR 1929 Mad 721), Patanjali Shastri, J. points out that the main & substantial relief sought in that case was the execution of a deed of transfer and not the prayer for declaration of title which was not only unnecessary but a relief which could not also strictly be granted until the title was conveyed and the suit was therefore not a suit for land within Clause 12 of the Letters Patent.

13. The ratio of the Federal Court decision in 1949-50 FCR 849: (AIR 1950 FC 83) is therefore clear that a suit for specific performance in equity jurisdiction where at any rate the only relief soughtIs the execution of a document of transfer and nothing else is not a suit for land within the meaning of Clause 12 of the Letters Patent.

14. Then Mahajan, J., another learned member of the same Bench Of the Federal Court who was dissenting observes at page 921 (of FCR): (at p. 110 of AIR) of that report that a suit for specific performance simpliciter is not a suit for land and no distinction between vendors and purchasers' suits for specific performance can logically be made as pointed out also by Gentle, J. in ILR (1947) 2 Cal 113 at p. 123. Mahajan J. however criticised at page 915 (of FCR): (at p. 108 of AIR) the judgment of Das, J. in 49 Cal WN 80.

15. There is an old authority in Lalla Ram v. Bibee Chowbain, 22 Suth WR 287, of a Division Bench of this court consisting of Sir Richard Couch, C. J. and Ainslie, J. although on the old Civil Procedure Code of 1859, where an agreement to grant a lease was held not to create an interest in immovable property and a suit upon it was not regarded as a suit for recovery of land or an interest in it. It suggests that a claim for possession was regarded only as consequential, a view subsequently taken by the Madras High Court to which we shall presently refer.

16. A good deal of confusion is created on this subject by the notion of consequential relief for possession. The source of this confusion appears to originate in the provision of Order 2, Rule 2 of the Civil Procedure Code. It will be necessary, therefore, to examine this aspect of the case, specially because the learned trial Judge appears to have denied this court's jurisdiction to the appellant on that ground.

17. The authority of the Division Bench of the Madras High Court in Krishnammal v. Sundararaja Aiyar ILR 38 Mad 698: (AIR 1914 Mad 465) is relevant on this point. It decides that where the plaintiff had obtained in a previous suit a decree against the defendants for specific performance of an agreement to sell certain immovable property to the plaintiff and had got a sale deed in his favour for execution of the decree, instituted a sub-sequent suit for the recovery of possession of those lands from the defendants, the subsequent suit was not barred by Order 2, Rule 2 of the Civil Procedure Code. Sankaran Nair, J., at p. 699 of that report (ILR Mad): (at p. 466 of AIR) observed :

'It is true that it was open to the plaintiff to sue not only for the execution of a deed of sale but also for possession in the previous suit. But was he bound to do so? At the time he brought that suit the right to possession was not vested in him. He would acquire that right only on the execution of! the deed of conveyance. Possession is not merely an incident or subsidiary to the sale deed. In a suit for specific performance the parties to the contract alone need be parties. In a suit for possession all persons in possession are proper parties.'

Tyabji J. in delivering a separate judgment in the same case noted at page 702 of the report (ILR Mad): (at p. 467 of AIR) the possibility that an agreement to sell the property might contain not only a covenant to transfer the ownership of the property by a registered instrument but also an independent and, so to say, incidental covenant to permit the vendee to take possession of the property.At page 705 of that report (ILR Mad): (at p. 469 or AIR) Tyabji, J., observes:

'I concede that a purchaser ought to be permitted for convenience to claim both reliefs at once in order to prevent disregard of his rights by a vendor as bold as the present appellant. Yet in strict form, the right to sue for possession on his title does not arise until the conveyance has already been executed, and unless thereafter the vendor refuses to give possession; prior to execution of the conveyance, there being no right to obtain possession, the denial of a right, that has not arisen, cannot furnish a cause of action'.

18. We respectfully agree with these reasonings of this Division Bench of the Madras High Court that Order 2, Rule 2 of the Code of Civil Procedure cannot be attracted to the suit for specific performance and that, if necessary, subsequent to the execution of the conveyance, a further suit for possession could be filed on the strength of such title. We have already referred to the decision of the Privy Council in 28 Ind App 221 (PC) which dealt with the reverse case where entirely different principles were applicable. Reference was made by G.K. Mitter, J. to the above Madras decision but he gave no reason why he did not accept the correctness of the Madras decision except setting out the observation of Pal, J. in Sherali Mridha v. Torapali : AIR1942Cal407 . These observations of Pal J. do not at all relate to a case for specific performance for the execution of a document. That was a suit where possession was directly involved and the principles laid down there by the learned single Judge, Pal J., are not, in our view, at all applicable to a suit for specific performance where the only relief claimed is a decree for execution of the document of transfer.

19. It is necessary to point out here that Order 2, Rule 2 of the Code of Civil Procedure requires that a suit shall include the whole of the claim which the plaintiff is entitled to make in respect of his cause of action. The cause of action in a suit for specific performance of a contract to execute a document of transfer is not a cause of action for possession of land. Possession only is consequential and the right to the same arises by virtue of the execution of the document of transfer and not before. In our opinion, the Madras decision in ILR 38 Mad 698: (AIR 1914 Mad 465) is the correct view. It may be observed here that Mahajan, J. in his dissentient judgment in 1949-50 FCR 849 at p. 947: (AIR 1950 FC 83 at p. 120) expressed the view that a suit by a purchaser for specific performance even with a prayer for possession is not a suit for land within the meaning of Clause 12 of the Letters Patent. A suit by a vendor against the purchaser for specific performance of a contract for sale of land was held in Land Mortgage Bank v. Sudurudeen Ahmed ILR 19 Cal 358 and Nagendra Nath v. Eraligool Co. Ltd. ILR 49 Cal 670: (AIR 1922 Cal 443) not to be a suit for land. These authorities decide that this Court has jurisdiction to apply the principle of equity by reason of the express provision of Clause 19 of its charter and a decree or order directing a person to execute a document is an exercise of its jurisdiction upon the individual and the Court in so doing acts in personam.

20. The only modern authority of this Court against the view we arc taking is really the decision of the learned single Judge, Ameer Ali, J. in All India Sugar Mills Co. Ltd. v. Sunder Singh : AIR1937Cal593 . There the learned Judge holds that a suit by a purchaser for specific performance of an agreement to sell land is a suit for land within the meaning of Clause 12 of the Letters Patent of this Court. He dissented from ILR 52 Mad 809: (AIR 1929 Mad 721 (FB)) & Hunsraj Morarji v. Ranchoddas, 7 Bom LR 319. He relied on this court's decision in Sree Nath Roy v. Gallydas Ghose, ILR 5 Cal 82 and ILR 19 Cal 358. The learned Judge did not apply the test laid down in Gokuldas v. Chaganlal : AIR1927Cal768 and Provash Chandra Sinha v. Ashutosh Mukherji : AIR1930Cal258 . Ameer Ali, J. however, was not happy in coining to that conclusion and at the end of his judgment made the following confession at pages 649-650 of that report (of ILR Cal): (at p. 595 of AIR):

'Speaking for myself, having regard to the judgment of Page J., in : AIR1927Cal768 and : AIR1930Cal258 and to the decision in ILR 52 Mad 809: (AIR 1929 Mad 72 L), I should probably have held English law to be the key to the construction of this Clause 12 and this suit, therefore, is not a suit for land. But having regard to the decisions of this court and to the manner in which they have long been understood, I do not think it would be right for me sitting on the Original Side to do so'.

21. Since then this decision of Ameer Ali, J. has come in for criticism. It was first criticised by Gentle, J. in ILR (1947) 2 Cal 113 at pages 122-123. It is unnecessary to repeat the criticism of Gentle, J. and we are of opinion that this criticism is well-founded. Secondly, it was also criticised by Das, J. in 49 Cal WN 80. While, therefore, Ameer Ali, J. logically wanted to hold that such a suit for specific performance was not a suit for land hut was compelled to hold otherwise by reason of precedents binding on him, it is now obvious that even the authorities are veering in favour of the view that such a suit for specific performance is not a suit for land within the meaning of Clause 12 of the Letters Patent.

22. I do not think it is necessary to digest other cases relating to exercise of equity jurisdiction by this Court in connection with mortgage, administration or trusts etc. dealing with land outside the original jurisdiction of this Court. Nor do I think it is necessary to recapitulate historically over again the Charter, the Letters Patent and the Case Law on the point so exhaustively discussed both by Gentle, J. and Das, J. in the two decisions delivered by them.

23. The foundation for this Court holding that a suit for specific performance, where the only relief claimed is a decree for execution of a document of transfer and nothing else is not a suit for land, is first the principle that it is a suit for enforcing a contract where the court is required to act only in personam; secondly, the cause of action for such specific performance is not the cause of action for the recovery of land as such or recovery of possession of land as such and the fact that such will ormay be the consequence is immaterial for the purpose; the cause of action for specific performance of a contract and not the cause of action for a titular or possessory claim for land; and thirdly, the context of Clause 12 of the Letters Patent in providing three basic tests for suits (i) for land, (ii) cause of action and (iii) place of residence or business of the defendant,--clearly indicates that where Courts are intended to act in equitable jurisdiction in personam it is the second or third test which has to be applied. The fact that a decree for specific performance will result in ultimate possession being given or obtained, does not convert it into a suit for land, for in that case the suit for land would not have been grouped as a class by itself apart from the class governed by the test of the cause of action or the test of the place of residence or place of business of the defendant in Clause 12 of the Letters Patent. Historically, as Fry points out in his celebrated work on Specific Performance, 6th Edition, page 7, the Old Common Law before equity in such cases commanded the Sheriff to deliver the land. Precisely because of that reason equity intervened to act in personam, so that now a decree for specific performance orders the defendant, or failing him this Court in his place, to execute a document of transfer. In modern jurisprudence and practice, this is now well settled. In Volume X, page 397 of Atkin's Encyclopedia of Forms, the only prayer shown in the pleading is for specific performance and not for possession. Indeed, in the forms of the Civil Procedure Code, both the Forms are used, one for specific performance simpliciter and the other for joint claim for specific performance and possession.

24. We, therefore, hold that a suit where the plaintiff claims a decree for specific performance only, directing the defendant to execute and register a lease with alternative claim for damages is not a suit for land within the meaning of Clause 12 of the Letters Patent.

25. For these reasons, we set aside the judgment and decree of the learned trial Judge and allow the appeal with costs. We, therefore, restore the suit and order that it be tried.

Bose, J.

26. I agree.


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