1. The facts necessary to be stated for the purposes of this appeal are these: In 1309, the plaintiff and his co-sharer obtained a darpatni settlement of 4-annas share of three villages from the predecessors of defendant No. 1 and executed a kabuliyat in their favour hypothecating the said 4-annas share of the three villages as well as seven other mouzahs as security for the payment of the darpatni rent and for the performance of obligations and discharge of liabilities incidental to the darpatni. In 1312 they sold the said darpatni to the defendant No. 2; and the defendant No. 1 recognized the transfer and accepted rent from the defendant No. 2. In the kobala by which the darpatni was sold there was a stipulation that the defendant No. 2 would furnish security to the defendant No. 1 or to the plaintiff and his co-sharer in order to re-place the security given by the plaintiff and his co-sharer. On the defendant No. 2 failing to furnish the said security the plaintiff, to whom the seven mouzahs in suit were subsequently allotted on partition between him and his co-sharer, instituted a suit against the defendant No. 2 making the defendant No. 1 pro forma defendant, for specific performance, and obtained a deposit of security in cash; but the defendant No. 1 did not accept the said security.
2. The plaintiff then instituted the present suit praying for a declaration that the said seven mouzahs were no longer subject to any charge.
3. The Munsif dismissed the suit, but the Subordinate Judge on appeal reversed that decision and granted the plaintiff a decree declaring that the charge no longer subsisted. From that decree the present appeal has been preferred by the heirs of the defendant No. 1.
4. The appellants' contention, which was the defence to the action, is that the liability of the lessee to the lessor continued notwithstanding the transfer, as based on the privity of contract between the parties; that the lessor had also a remedy against the transferee for rent and on the covenants running with the land, the transferee was under a liability based on privity of estate; that although the lessor has his remedy as against the transferee who is to be treated as primarily liable, the original lessee remains in the position of a surety and he cannot get rid of his liability merely by transfer. It is contended further that even if the liability to pay the rent be held to cease in consequence of the transfer the security remains in force and the charge is not extinguished.
5. The respondent urges that the lessee ceases to be liable for the rent as soon as the transfer is complete, and in any event if the lessor has accepted the transferee, whether expressly or impliedly, e.g., by acceptance of rent; that there having been acceptance of rent in the present case the original lessee's liability for rent has altogether ceased; and that to hold under such circumstances that the security still remains in force would be to offend against the rule against perpetuities.
6. Now, there is no dispute that the darpatni is a permanent tenure governed by the provisions of the Bengal Tenancy Act, Mahomed Abbas Mondul v. Brojo Sundari Debia 18 C. 360 : 9 Ind. Dec. (N.S.) 240. Under Section 11 of the Bengal Tenancy Act, it is capable of being transferred in the same manner and to the same extent as other immoveable property. Section 12 provides a limit as to the mode in which the transfer is to be made. As soon as the document by which the transfer is made is registered--and the registration is not to take place until a condition precedent mentioned in Section 12 is fulfilled--the transfer is complete. When the estate is transferred and the vendor ceases to have any estate, then if the vendor's liability is a liability consequent on privity of estate, that liability ceases: Kristo Bulluv Ghose v. Kristo Lal Singh 16 C. 642 : 8 Ind. Dec. (N.S.) 424 and Girish Chandra Guho v. Khagendra Nath Chattopadhyaya 9 Ind. Cas. 1001 : 16 C.W.N. 64 : 13 C.L.J. 613. The same principle has been held to apply in the case of transfer by the original lessee, Hamendra Nath Mukerji v. Kumar Nath Bay 12 C.W.N. 478. It is clear therefore that after the transfer the plaintiff was no longer liable for the rent, and the defendant No. 1 was thenceforward to look to the defendant No. 2 for the same.
7. The next question is as to whether, when the liability for payment of the rent ceased, the security continued and the charge remained in force. The appellants' contention is that it did, and that though as a consequence of the transfer the transferee became by operation of law the tenant of the tenure and the transferror ceased to be a tenant, the transferror was not necessarily absolved from the liability which was created by the contract. In support of this contention reliance has been placed upon a passage in the judgment of the Court in the case of Rupchand Ghose v. Narendra Krishna Ghose 28 Ind. Cas. 683 : 19 C.W.N. 112 at p. 114. The passage indicates that the fact that by transfer' the transferror ceases to be a tenant does not imply that he is absolved from liability tinder the terms of the contract between him and the lessor, and that it is conceivable that a person may cease to be a tenant and yet continue liable to the landlord under his personal covenant.
8. The respondent urges that if it is held that the security remains in force inspite of the transfer, it would mean that the lessor would be competent to impose a restriction on transfer of a permanent tenure which is transferable by law and that in that case the security might continue for ever and thus offend against the rule against perpetuities.
9. As regards the first of these objections, in my opinion, it is not well-founded on principle. In the case of Dinobundhu Roy v. W.C. Banerjee 19 C. 774 : 9 Ind. Dec. (N.S.) 958, it was held by this Court that a transfer of a tenure made in terms of the provisions of the Bengal Tenancy Act is not binding on the landlord, if there is a contract between the landlord and the tenant that the transfer shall not be valid and binding until security to the satisfaction of the landlord has been furnished, and if such security has not been given; and that in such a case the original tenant is still liable for the rent. Permanent leases no doubt are transferable under Section 11 of the Bengal Tenancy Act; but a provision in a lease of a permanent tenure for forfeiture or re-entry in case of assignment in violation of its terms would not be invalid in Keshab Lal Nag Majumdar v. Madhu Sudan Pal Kundu 6 Ind. Cas. 685 : 12 C.L.J. 126, it was held by this Court that the provisions of Section 10 of the Transfer of Property Act saving conditions restraining alienation in leases where the conditions are for the benefit of the lessor, are not inconsistent with the provisions of Section 11 of the Bengal Tenancy Act, and that the two provisions of the two Acts are not inconsistent or repugnant to each other but are capable of standing together. It follows, therefore, that the lessor is competent to insist on a stipulation that he would not be bound by the transfer unless the transferee keeps the security in force. The whole question then resolves itself into one as to whether such an intention or its contrary may be gathered from the kabuliyat. The learned Subordinate Judge has proceeded upon the decision in the case of Bijoy Chand Mohatab Bahadur v. Sarat Chandra Adhiya 51 Ind. Cas. 909 : 29 C.L.J. 476 which he treats as an authority for the proposition that the liability to pay the rent having ceased, the charge created for payment of rent is automatically extinguished. The decision in that case, however, rested upon the terms of the kabuliyat on which the case was based and not upon any such general principle. The kabuliyat in that case provided that so long as the lessees were not released from the liability to pay the rent, the lessees shall not be able to, transfer in any manner the property mortgaged as security for the rent. It was held in the case that on the transfer being completed the lessees' liability to pay the rent ceased and, therefore, the security was at an end.
10. The relevant passages in the kabuliyat in the present case are the following--'.... We shall without objection provide She rent instalment by instalment. If we fail therein you will be entitled to recover the arrears, according to the law which is in force, or which will be in force, from the said darpatni mehal and from the properties hypothecated as specified in Schedule (kha) or from our other moveable and immoveable properties which stand in our names or benami. To that neither we nor our heirs or representatives shall have any objection at any time whatsoever.... If you suffer any damage by our acts... then you will be entitled to recover the same from whatever moveable or immoveable properties we or our heirs or representatives shall have in our own name or benami and from the properties hypothecated and specified in Schedule (kha) and to that neither we nor they shall be entitled to raise any objection.... If this darpatni mehal be sold for arrears of rent due by us or in execution or is transferred in any other way, our representatives shall be bound by all the terms of this kabuliyat.... Being in possession as darpatni talukdar and maintaining intact the boundaries and regularly paying the rent, with our sons, grandsons, heirs and representatives shall in great felicity enjoy and possess the darpatni interest with powers of gift and sale.... In case we do anything injurious to you we and our heirs and representatives shall be bound to compensate you therefore, and in order to secure the said damages and for the performance of all the stipulations of this kabuliyat we give as security the properties in Schedule (kha) below owned and possessed by us....'
11. These conditions created a charge on the seven mouzahs for all times to come for the due payment of the darpatni rent and the performance of the other obligations arising under the kabuliyat, and there is nothing in the kabuliyat which may go to indicate that the security would be extinguished on the lessees' liability to pay the rent ceasing with the transfer. That this was the intention of the parties is also suggested by the term in the kobala by which the plaintiff and his co-sharer transferred the darpatni to the defendant No. 2 by which the latter was required to furnish security to the plaintiff and his co-sharer or to the defendant No. 1 in order to re-place the original security. This intention is also evidenced by the fact of the institution of the suit for specific performance, the result of which, however, is not binding on the defendant No. 1.
12. As regards the contention that a security of this description which is to last for all times to come is repugnant to the rule against perpetuities, I am not prepared to regard the contention as well-founded. This rule affects only the creation of a future interest in property and the restricting of transfer of property by tying it up. The rule has no application to the case of a charge where a present interest is created and there is no transfer of an interest in property, but the property is merely made security for the payment of money. The creation of this charge was a part of the consideration for the darpatni lease, and. I am unable to see how it could be extinguished merely because the lessee chose to transfer his interest under the lease. The position, therefore, is this: The liability to pay the rent subsists so long as the relationship of landlord and tenant exists. This relationship as between a landlord and his lessee, the permanent tenure-holder, ceases on the latter transferring the whole of his tenure. The lease may create further rights and liabilities as between the parties thereto and where it does, they do not cease automatically on the termination of the relationship.
13. For these reasons I am of opinion that plaintiff by merely transferring the darpatni to the defendant No. 2 could not get rid of the charge created by him under the kabuliyat, and that the mere acceptance of rent by the defendant No. 1 from the defendant No. 2 has not extinguished the same. The plaintiff, in my opinion, is not entitled to the declaration sought for by him.
14. The decree of the learned Subordinate Judge should be set aside and that of the learned Munsif restored and the plaintiff's suit dismissed with costs in all the Courts.
15. I agree.