The action out of which this appeal arises was instituted on 30th September 1921, and was for possession of certain lands, 48 bighas, and some odd cottahs in mauza Naya Gaon. The plaintiffs, now the first two respondents, claimed the proportionate share as purchaser under deeds of July 1921, whereby they purchased a 12 annas' share in the mauza. Appellants, as defendants, resisted the claim for possession on the ground that the disputed lands were raiyati holdings, of which they were tenants, the title under which as transferees they held dating back many years and having been recognized in the khatian of 1902. For present purposes the history of the relevant village titles may be traced back to 1882, when the zamindars, who were throughout absentee landlords, began to grant certain leases to a Mr. Crowdy, who started an indigo factory in the mauza. He or his successors may be referred to herein as the Factory, the name by which it was called being Bheriahi. The leases included a permanent lease of 23 bighas (not material in this case), on which the buildings were erected, and various other thika leases. Under these latter leases there was continuous possession by the Factory or its mortgagees or transferees until September 1909. Some of these leases did not actually expire till September 1910, but that distinction appears to have been overlooked. During the period in which the Factory were in possession as thikadars, they acquired by purchase the occupancy rights over the 48 bighas now in dispute, and these rights were recognized in the khatian of 1902.
On 5th April 1909, the appellants' father was put into possession of these rights under the circumstances now to be detailed. The Factory had granted two separate mortgages, one of 7th July 1896, to the appellants' grandfather, who on 20th April 1898, obtained a decree on the mortgage for Rs. 17,238-6-0, and future interest; the other mortgage was given in 1894 to certain lenders, who on 7th November 1899, assigned it to Finlay, Muir and Co. About 1902 Finlay, Muir and Co. entered into possession as mortgagees and brought a suit for foreclosure. Disputes arose as to priority between Finlay, Muir and Co., and the appellants' predecessors. These disputes were finally compromised on 18th March 1909, on the terms that Finlay, Muir and Co. should convey the whole property of the Factory, to the appellants' father free of all encumbrances, for Rs.5,000, whereupon the appellants' father, was put in possession, Finlay, Muir and Co., having foreclosed with that object. A formal conveyance to the appellants' father (since deceased) was executed to give effect to the compromise on 8th February 1910. His rights are now vested in the appellants. Meantime, in September 1909, the zamindars had granted a lease as on the expiry of the Factory's lease of the 12 annas interest in the mauza to Mahant Lachman Dass and Bhauna or Mona Singh, and in November 1909, a further lease of two annas to Parmeshwar Jha. A certain discrepancy in the interest so leased as compared with the entire holding may be disregarded and was not relied on at the hearing of the appeal. It was agreed that there was no question of parcels. These leases expired in September or November 1918, being each for nine years. By deeds dated 2nd July 1921, and 22nd July 1921 the proprietors of shares aggregating 12 annas sold their shares to the plaintiffs-respondents, who instituted the present action on 29th September 1921, having been refused possession by the appellants.
The case was heard before the Subordinate Judge of Monghyr, who gave judgment on 31st May 1924. He found that the disputed lands were lands in which the Factory had acquired a right of occupancy and were not bakasht lands, and he decided in favour of the appellants on the ground of recognition : though he decided against the appellants on their plea that there was a custom admitting that occupancy rights could be transferred without the consent of the landlord, he held that that plea of custom was immaterial because Finlay, Muir and Co. having succeeded to all the rights of the Factory, including the occupancy rights in the lands in question, could transfer to the appellants' predecessor those occupancy rights, and being for this purpose in law immediate landlords of the raiyat, their consent (being a consent to their own act) was implied. He decided against the appellants' plea that the suit was barred by limitation; he also decided that S. 22 (3), Ben. Ten. Act of 1885, did not affect the appellants' rights, nor did any principle of merger apply. He dismissed the suit by a decree dated 31st May 1924.
This decree was on appeal set aside by the High Court of Judicature at Patna. The Judges, by a concurrent finding, held that the Factory had acquired a right of occupancy in the disputed lands by purchase from the original tenants; they agreed with the Subordinate Judge that no custom of transferability had been proved; but disagreed with him on the question of recognition and held the appellants had not been recognized as tenants.
On that ground they held that the respondents were entitled to succeed. The present appeal to His Majesty in Council is from that decree.
It was not contested before this Board that if the appellants were recognized as occupancy tenants by the then thikadars, their rights of occupancy must prevail.
On this decisive issue their Lordships are in agreement with the determination of the Subordinate Judge. The only document relied on by the appellants was a rent receipt: on its face it was dated 13th January 1912, and was in respect of the year September 1909 to September 1910. It stated the tenant to be Babu Narain Prasad, the appellants' father, and purported to be in respect of the lands now disputed, stating the landlords to be the three thikadars, Mahant Lachman Dass, Parmeshwar Jha and Babu Mona Singh; it purported to be signed by Lachman Dass by his own pen, and by Mona Singh and Parmeshwar Jha "by my own pen" (that is, by Mona Singh). It was countersigned by Lalji Lal, the patwari or village accountant. The Subordinate Judge was satisfied of the genuineness of that receipt, and their Lordships prefer his conclusion on this point to that of the Judges of the High Court. The Factory had acquired a right of occupancy in the lands, and the lands had been for many years in their possession, and than in the possession of the mortgagees, Finlay, Muir and Co., and then in uninterrupted sequence in that of the appellants or their prodecessor-in-title: rent was admittedly received from the appellants or their father in respect of the permanent lease of the 23 bighas by the three thikadars, and it is difficult to believe that the latter would have acquiesced in the appellants or their predecessors retaining possession of the disputed lands all these years (as in fact was the case) without paying rent. The evidence was that Parmeshwar Jha's share was collected with his authority by the other two thikadars, and indeed he does not sign the receipts for the rent under the permanent lease. The objection that other receipts might have been produced is a two-edged argument. The High Court Judges comment on the fact that Lalji Lal was not called, but it was proved at the trial that he was dead. No one of the three thikadars came forward to deny the receipt. But if the receipt was genuine, it must, in the opinion of this Board, be not merely a recognition of some tenancy, but of a raiyati tenancy; the true effect of an act of recognition must depend on the surrounding circumstances: in the present case it was beyond question that for very many years the disputed lands were treated as lands in which the factory had a right of occupancy. This appears clearly in the khatian of 1902. Acceptance of rent in all the facts from the appellants or their predecessors-in-title, who held in unbroken sequence from the Factory, can only, in their Lordships' judgment, amount to a full recognition of their rights as occupancy raiyats.
This conclusion is sufficient to dispose of the case, because the principle has been admitted in this case that recognition, apart from other grounds, is sufficient proof of title. It is unnecessary for this Board to express an opinion on the general correctness of the principle so admitted or on the question whether S. 22 (3), Ben. Ten. Act, 1885, applies to the case. In the result their Lordships are of opinion that the appeal should be allowed and the appellants have their costs of this appeal and also their costs in the Courts below, the decree of the Subordinate Judge being restored. Their Lordships will humbly so advise Hiss Majesty.