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(Raja) Satya, Niranjan Chakravarty and Others Vs. Surajubala Debi and Another - Court Judgment

LegalCrystal Citation
CourtPrivy Council
Decided On
Case NumberPrivy Council Appeal No. 52 of 1928 (From Calcutta: Calcutta Appeal No. 31 of 1926)
Judge
Appellant(Raja) Satya, Niranjan Chakravarty and Others
RespondentSurajubala Debi and Another
Advocates:Q.J.W. Larwell and W. Wallach, for Appellants; A.M. Dunne and B. Dube, for Respondents. [The judgment of the Calcutta High Court which was not disturbed by their Lordships of the Privy Council was delivered by B.B. Ghose and Graham, JJ., in the presence o
Excerpt:
transfer of property act (4 of 1882) - section 117 - cases referred: (1) 22 cal 494. comparative citation: 1930 air(pc) 13.....be void under s. 10, t. p. act if the benefit reserved to the lessor was not with reference to the property leased and as in this case the benefit to the lessor, according to the finding of the subordinate judge would be with reference to some other property, the matter would not come within the exception of 8. 10, t. p. act. mo authority has been cited before us for this proposition and we are not prepared in this case to express a definite opinion on the question. it is unnecessary for us to decide whether the transfer is void or whether it confers any interest on defendant 4 because it is not a suit for ejectment on the ground of forfeiture, that the real question in the case is whether defendants 1, 2 and 3 can exonerate themselves from the liability on their personal covenant under.....
Judgment:

This is an appeal by defendants 1, 2 and 3 against a judgment and decree of the Subordinate Judge of Birbhum allowing the plaintiff's claim for rent for four years from the Ashar kist of 1327 to the Ashar kist of 1330 B. S. The plaintiff is a member of the same family as defendants 1, 2 and 3 she being the widow of a son of one of the predeceased brothers of the said defendants. She inherited a certain share of the property to which her husband was entitled as a descendant of Maharaja Ram Ranjan Chakravarty. It is needless to say that these parties are people of considerable property and respectability. It seems that there was a very unfortunate dissension between the plaintiff and defendants 1, 2 and 3. This was apparently settled by the plaintiff executing a lease by way of Ijara of her share of the property by a deed dated 8th January 1916. It is unnecessary just now to refer to any of the terms of the lease; but it may be mentioned that, under that lease, a sum of Rs. 20,000 per year was payable to the plaintiff by defendants 1,2 and 3 who will henceforth be called the lessees, in certain installments. Since, however, the execution of the document the plaintiff, it appears, had always to bring suits to recover the money which became due to her under the lease. It also appears from the evidence on the record that she has never been able to recover her dues on any occasion without a suit being fought up to the High Court. The defence of defendants 1, 2 and 3 the lessees mainly was that they had transferred the leasehold by way of gift to defendant 4 who is their sister by a deed dated 7th July 1920 and they said that the plaintiff was informed of the fact of this gift by service of notice by the lessees as well as by defendant 4 in October 1920. It was also stated that defendant 4 was willing and she actually offered to give security to the satisfaction of the plaintiff under the terms of the lease. On these grounds, the lessees alleged that they were not bound to pay the rent reserved under the lease but the liability was that of defendant 4. Defendant 4 also disputed the plaintiff's title to recover rent mainly on the ground that the suit having been brought against the lessees as well as herself was not maintainable in the present form. It is not necessary to state the other facts alleged by her. Three issues were raised in the Court below:

"(1) Is the deed of gift in favour of defendant 4 colourable and fraudulent one?" (2) Is the ijara interest transferable and (3) "Are defendants 1, 2 and 3 absolved from their liability to pay rents by making the gift to defendant 4?"

All these three issues were found by the Subordinate Judge against the lessees and he passed a decree in favour of the plaintiff for the amount claimed against defendants 1, 2 and 3. Defendants 1, 2 and 3 have appealed against that judgment and their contention is that the Subordinate Judge's decision with regard to all the three issues is erroneous.

The Subordinate Judge found on various grounds that the deed of gift was a colourable transaction and that it was not intended to effect an actual transfer of the interest of the lessees in favour of defendant 4. He held that the actual possession of the property and the dominion over it was retained by the lessees and that it was with some ulterior motive that the lessees had executed the deed of gift in favour of their sister, defendant 4. The main facts on which we think that the findings of the Subordinate Judge may be supported are these. This lady, defendant 4, is an inhabitant of a different village in another district and the properties on the evidence on the record, are being managed in the same way as they were used to be before the deed of gift was executed that is, by the servants of the lessees and from their office. It is true that there is evidence that some leases have been executed in the name of defendant 4 and that suits have also been brought against the subordinate tenants in the name of defendant 4. But, as the Subordinate Judge points out that is almost always done in every case where a colourable transaction has been entered into by the real owners for some purpose of their own. The most important fact is, that, although the deed of gift was executed four years prior to the date of the hearing of the suit, the evidence of the manager of the lessees who was managing the property is that defendant 4 had not received any of the profits of the ijara property. There is one other fact which may also be alluded to and it is this: The case of the appellants is that this gift was made for the purpose of benefiting defendant 4 because she was not in very affluent circumstances. But it would appear from the evidence on the side of the defendants that it is the case of the lessees that the ijara is a losing concern and it is hardly necessary to add that the object of the document certainly was not to confer any benefit on the lady. It is unnecessary for us to deal in detail with this point because in our opinion, as we shall state later on, the plaintiff is entitled to succeed in her claim against defendants 1, 2 and 3 on ground 3.

With regard to issue 2, it is contended on behalf of the appellants that the Subordinate Judge is wrong in holding that the ijara interest was not transferable. It may be conceded that every leasehold interest is transferable under the law except certain rights created by statute under the Bengal Tenancy Act. What the Subordinate Judge has really decided is that, having regard to the restrictive covenant in the lease itself, the transfer is not binding upon the lessor. The Subordinate Judge deals with the provisions of S.10, T. P. Act and, in his opinion, this covenant although there was no clause for re-entry on its breach, prevented the lessees from alienating the property. The Subordinate Judge finds that, in a house a portion of which has been included in the lease, the lessor, reserved two rooms for her own use where she intended to live under the terms of the lease with her female relatives and maid servants. The learned Judge holds that this reservation was made in view of the fact that the lessees being her near relations there could possibly be no objections to her living in the same house with them; but, if there was a transfer to a stranger it would be impossible for her to use the portion of the house reserved for herself. With regard to this point, the contention made by the learned advocate on behalf of the appellants is that the condition restraining the alienation of the property would be void under S. 10, T. P. Act if the benefit reserved to the lessor was not with reference to the property leased and as in this case the benefit to the lessor, according to the finding of the Subordinate Judge would be with reference to some other property, the matter would not come within the exception of 8. 10, T. P. Act. Mo authority has been cited before us for this proposition and we are not prepared in this case to express a definite opinion on the question. It is unnecessary for us to decide whether the transfer is void or whether it confers any interest on defendant 4 because it is not a suit for ejectment on the ground of forfeiture, that the real question in the case is whether defendants 1, 2 and 3 can exonerate themselves from the liability on their personal covenant under the lease to pay the rent by reason of this transfer, and this brings us to issue 3 raised in the Court below.

It is necessary to refer to the clause containing the personal covenant of the lessees: It runs thus:

"You shall not be competent to transfer this Ijara right in any way by gift, sale, etc. or to surrender it; and if you do so, the same shall not be binding on me. You together with your heirs shall remain bound to pay duly the rent and munafa of this ijara so long as I shall live. I shall be competent all along to recover my fixed munafa from you and your heirs and to that no objection shall be entertained to the effect that you are not in possession of the ijara right or that the same has been transferred or surrendered by you."

The next portion of the covenant is important as bearing on the contention of the appellants. It is said by the learned advocate for the plaintiff respondent that the translation of it, as contained in p. 29 of the third part of the printed paper book in the case, does not give an accurate idea of the original which is in the Bengali language. That passage may be translated more accurately in this way :

"Notwithstanding (the aforesaid provision,) if, on account of the intricacies of the law, any transfer made by you becomes in any way binding (on me) then you and your heirs shall re main bound to pay the fixed amount of rent so long as the transferee will not furnish security in proper quantities of immovable properties to be fixed by me for the due payment of the fixed rent and this shall in no way be varied."

The Subordinate Judge has held that, under this provision, the original lessees are not exonerated from their liability to pay the rent reserved under the contract and that they are also not exonerated having regard to the provisions of B. 108, Cl. (j), T. P. Act. It is contended however, that the fact that notice of this transfer was given to the plaintiff by the transferee as well as by the transferors of the leasehold takes the case out of the provisions of Cl. (j),S. 108, T. P. Act, because the exoneration is not claimed by reason only of the transfer. This argument was advanced in the case of Sasi Bhusan Raha v. Tara Lal Singh Deo (1); but was rejected by the Court. It cannot be said that by virtue of the service of the notice of transfer on the lessor, the lessees can got rid of their personal covenant to pay the rent. It is also contended that this leasehold is not governed by the Transfer of Property Act having regard to the provisions of S. 117 of the said Act. But it is hardly necessary to point out that this was not a lease for agricultural purposes as mentioned in S. 117, T. P. Act, which only makes the provisions of the Act inapplicable under certain circumstances. This was the creation of a tenancy for the purpose of realization of rent from the cultivating tenants and, therefore, the provisions of the Transfer of Property Act apply to it.

The next contention is that the terms of the contract as set forth above exonerate the lessees from their liability to pay the rent because there is the provision that, if the transfer is held to be binding on the lessor the lessees would be bound to pay the rent only so long as the transferee does not furnish security; and it is said that, under the law, this leasehold is transferable and the transferee is willing to furnish security as would be fixed by the lessor but the lessor has not expressed her willingness to fix the amount of security and she cannot by her refusal to do so continue to hold the original lessees liable for the rent. But it seems to us that the proper construction of that provision is that, under the terms of the contract, the lessor would not be bound to recognize any transfer but would be entitled to hold the original lessees liable for the rent, but if, on account of some legal technicality, it is held that the lessor would be bound to recognize the transferee then there is that provision that even in that case the lessees would be bound to pay the rent unless security is offered. In our opinion, therefore, that passage does not mean that whenever the lessees choose to transfer the leasehold interest, the lessor would be bound to fix the security for the due payment of the rent which the transferee would be required to give and the original lessees would be exonerated from their personal liability to pay the rent.

It is then contended on behalf of the appellants that when the transferee is prepared to furnish security, there is no reason why the plaintiff should continue to hold the original lessees liable. But the plaintiff says that the original lessees being her cosharers and being solvent, there is no fear of her ever being deprived of the rent, that if she exonerates the original lessees from their personal covenant, the result would be that whatever the value of the security offered by the transferee may be, if the rent is not paid for a certain number of years, the security will vanish and she will not be able to recover any rent whatsoever and that it is on that ground that she is not willing to exonerate the original lessees from their personal covenant. However that may be, having regard to the terms of the lease, we cannot hold that defendants 1, 2 and 3 are exonerated from their liability on their personal covenant to pay the rent. We find from the record as printed at p. 114, part 3 of the Paper Book that the question as regards the liability of defendants 1, 2 and 3 to pay the rent in spite of the transfer made by them came up for decision in this Court in appeal from original decree No. 54 of 1923 and it was held by a Division Bench that:

"by the terms of the pattah and kabuliat the defendants' liability to pay rent continued in spite of any transfer made by them and, as held by the lower Court, such an agreement cannot be held to be illegal having regard to the provisions of S. 108-J. T. P. Act."

To this judgment, one of us was a party and we see no reason to deviate from the opinion that was expressed in that judgment. We might have held that this question of liability on account of the provisions in the pattah and the kabuliat which created the lease was res judicata. But that point not having been raised in the lower Court, we refrain from expressing any opinion on it. However, we hold independently of that judgment upon a fresh construction of the terms of the kabuliat that the lessees are not exonerated from their personal liability to pay the rent by reason of the transaction that they have gone through.

No decree was passed by the trial Judge against defendant 4. The appeal to this Court, as we have already stated, was by defendants 1, 2 and 3. In their appeal, they impleaded defendant 4 as a pro forma respondent. After the close of the address on behalf of the appellants, the learned advocate appearing for defendant 4 desired to address the Court against the decision of the Subordinate Judge. As already stated, no decree was passed against this defendant and she did not join in the appeal preferred by the other defendants. We, therefore, thought it inexpedient to have a second address on her behalf attacking the findings of the Subordinate Judge or, in other words, another address in support of the appeal.

The result, therefore, is that the appeal to this Court is dismissed with costs to be paid by the appellants to the plaintiff-respondent. Defendant 4 who is the pro forma respondent will bear her own costs.

(The defendants preferred an appeal from this to their Lordships of the Privy Council and the following judgment was delivered.)

LORD SHAW-In this appeal everything that could be said has been cogently argued by Mr. Farwell. He has confined himself with logical accuracy to the proposition set forth in the judgment of the High Court, realising, as the learned Judges expressed it, that:

"this is not a suit for ejectment on the ground of forfeiture, but the real question in the case is whether the defendants"

whom he here represents :

"can exonerate themselves from the liability on their personal covenant under the lease to pay the rent by reason of this transfer" of the property. Thereupon there arises the third issue, the one which has bean determined by the judgment of the High Court. Upon that point their Lordships are not desirous of entering into the subject at large, because, in their view nothing has been urged which weakens the force of that judgment or inclines their Lordships to sustain this appeal.

Their Lordships will accordingly humbly advise His Majesty that this appeal should be dismissed with costs. An application for the filing of a supplemental record made by the appellants will also be formally dismissed with costs.

Appeal dismissed.


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