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Judgment
Kumaraswami Sastri, J.—The question for decision is whether Section 13, Clause 3 of the Estates Land Act enables the tenant to claim
exemption from liability to pay a higher rate of rent for crops raised with the help of improvements made at the tenant''s sole expense where the
improvements had been effected before the Act came into force and where there had been a contract entered into between the landlord and the
tenant before the passing of the Act for the payment of such enhanced rent.
The facts found by the learned Judges are:
(1) That the rent claimed by the Zamindar has been paid by the tenants for over 60 years,
(2) that there was a valid contract to pay the rent which was legally enforceable under the provisions of the Rent Recovery Act,
(3) that the improvements in respect of which the enhanced rent had been paid ever since 1846 were effected by the tenants. Mr. Justice Sadasiva
Aiyar was of opinion that in spite of these facts the landlord was not entitled to sue tor the rent at the rate paid ever since 1846 as Section 13,
Clause 3 of the Estates Land Act was retrospective and prevented the landlord from claiming higher rent in consequence of improvements effected
by the tenants even though such improvements have been effected before the passing of the Act and the rent claimed was legally recoverable under
the Rent Recovery Act. Mr. Justice Napier took the opposite view and held that the section only applied to improvements made after the passing
of the Act.
The question resolves itself into whether Section 13, Clause 3 has retrospective operation. There is nothing in the wording of the section to indicate
that the legislature intended it to be retrospective. Clause 3 runs as follows: ""Notwithstanding any usage or contract to the contrary a ryot shall not
by reason of making an improvement at his sole expense become liable to pay a higher rate of rent on account of any increase of production or of
any change in the nature of the crop raised as a consequence of such improvement.
It would require very strong grounds for holding that the legislature intended to disturb vested rights which landlords had under valid and
enforceable contracts. It is no doubt true that the Madras Estates Land Act was intended in a large measure to benefit tenants, but that is no
ground for construing the Act on the hypothesis that in every case tenants were to have all the rights and landlords were only to be subject to all the
liabilities incident to the ownership and possession of property.
The principles guiding the interpretation of a statute where retrospective effect is sought to be given to a provision so as to defeat vested rights
have been clearly laid down in several decisions. In Reid v. Reid (1886) L.R. 31 Ch. D. 402 Bowen L.J. observed as follows: ""The particular rule
of construction which has been referred to, but which is valuable only when the words of an Act of Parliament are not plain, is embodied in the
well-known trite maxim Omnis nova constitutio futuris formam imponere debet nonprae-teritis--that is, that except in special cases the new law
ought to be construed so as to interfere as little as possible with vested rights. It seems to me that even in construing an Act which is to a certain
extent retrospective, and in construing a section which is to a certain extent retrospective, we ought nevertheless to bear in mind that maxim as
applicable whenever we reach the line at which the words of the section cease to be plain. That is a necessary and logical corollary of the general
proposition that you ought not to give a larger retrospective power to a section, even in an Act which is to some extent intended to be
retrospective, than you can plainly see the Legislature meant."" The same rule has been expressed by Lindley L.J. in Lauri v. Renad (1892) 3 Ch.
402 where he observes as follows: ""It is a fundamental rule of English law that no statute shall be construed so as to have a retrospective operation
unless its language is such as plainly to require such a construction; and the same rule involves another and subordinate rule to the effect that a
statute is not to be construed so as to have a greater retrospective operation than its language renders necessary."" ""The same view was taken by
him in (1903) L.R. 31 I.A. 30 (Privy Council) where their Lordships of the Privy Council held that ""it was not in accordance with sound principles
of interpreting statutes to give them a retrospective effect.
In Ramakrishna Chetty Vs. Subbaraya Aiyar and Another, was held that the Estates Land Act had no retrospective operation so as to affect the
period of limitation in respect of contracts falling under Article 116 of the Limitation Act.
The result of the decisions has been well summarised by Craies in his work on Statute Law, where he observes (page 322) "" and perhaps no
rule of construction is more firmly established than this--that a retrospective operation is not to be given to a statute so as to impair an existing right
or obligation otherwise than as regards matter of procedure, unless that effect cannot be avoided without doing violence to the language of the
enactment. If the enactment is expressed in language which is fairly capable of either interpretation, it should be construed as prospective only."" As
observed by Maxwell the rules laid down in Lauri v. Renad (1892) 3 Ch. 402 Reid v. Reid (1886) 31 Ch. D. 102 West v. Gwynne (1911) 2.
Ch.15 have special operation ""where the enactment would prejudicially affect vested rights or the legal character of past transactions or impair
contracts.
Section 6, Clause (c) of the General Clauses Act and Section 8, Clause (d) of the Madras Act 1 of 1891 also provide that the repeal of an Act
shall not affect any rights accrued under the enactment repealed.
Applying these well-known rules to the construction to Section 13 of the Estates Land Act, it seems to me that a retrospective operation cannot
be given to Clause 3 of the section. Clauses 1 and 2 to the section can only refer to improvements to be effected in future and if the legislature
intended Clause 3 to be retrospective it would have given some indication of such intention. On the contrary the use of the words "" shall not by
reason of making an improvement become liable"" indicate that only future improvements are intended.
It appears from other sections of the Act that where the legislature intended any provision to be retrospective it used words "" whether before or
after the commencement (or passing) of this Act. "" A reference to Sections 8, 37, 187 and 188 makes this clear.
So far as rent is concerned Section 28 provides that in all proceedings under the Act, the rent or rate of rent for the time being lawfully payable
by the ryot shall be presumed to be fair and equitable until the contrary is proved. Under the law as it stood prior to the passing of the Estates
Land Act a contract to pay increased rent even though improvements were made by the tenant was legally enforceable. It was therefore rent
lawfully payable by the ryot "" when the Estates Land Act was passed and was to be presumed to be fair and equitable. It is difficult to see under
what canons of interpretation it can be held that Section 13, Clause 3 should be construed as taking away such a right. It is argued by the
respondents'' advocate that the policy of the law has always been to give to the tenant the benefit of improvements made by him. This may be so,
but the law as it stood prior to the passing of the Estates Land Act did not prevent additional rent being legally recoverable in cases where it was
payable under a contract.
I am of opinion that the words ''contract to the contrary'' refer only to contracts made after the passing of the Act and that Section 13, Clause
3 has no retrospective operation in cases where rent claimed was payable under a contract which would have been legally enforceable under the
Rent Recovery Act or any other law in force at the time of the passing of the Estates Land Act.