Sukhnoo Shah vs Chandu Lal and Others

K.V. Gopalakrishnan Nair, J.—This is a second appeal against the judgment of the Addl. District Judge at Jammu who reversed the

decision of the Subordinate Judge at Bhaderwah. It is necessary at the outset to state succinctly the salient facts relating to this protracted litigation.

Suraj Ram, father of Respondents, executed an agreement for sale of his land to Sukhnu Shah, the Appellant, on 30-7-1984 (Bikrami). As

Suraj Ram did not implement the agreement Sukhnu Shah instituted a suit for specific performance and duly obtained a decree from the Munsiffs

court at Bhaderwah on 11-3-1986. As in spite of the decree Suraj Ram did not execute a formal sale deed, the decree-holder took out execution

and on 23-3-1988 a sale deed in favour of Sukhnu Shah was executed by the court. It was got registered on 21-6-1988.

But Suraj Ram did not deliver possession of the property to Sukhnu Shah who, therefore, filed a suit for possession on the basis of the sale deed in

his favour and obtained a decree for possession from the Subordinate Judge at Bhaderwah on 25-2-1989. That was a decree for joint possession

along with other co-sharers of Suraj Ram. In 1996 Sukhnoo Shah launched partition proceedings and got his vendor's share of the land separated

and entered into exclusive possession thereof.

In the year 2002 the sons of Suraj Ram filed a suit against Sukhnoo Shah to set aside the sale In his favour on the ground that the property sold

was ancestral property and the sale by their father was neither for family necessity nor for discharging their father's antecedent debts. The other

ground on which the suit was based was that Sukhnoo Shah being a non-agriculturist, a sale in his favour by or on behalf of Suraj Ram who was an

agriculturist was void under the provisions of the Jammu Alienation of Land Regulation. This suit was dismissed by the Subordinate Judge at

Bhaderwah on 26th Har, 2004. An appeal to the District Judge at Jammu was also dismissed in 2005.

A second appeal was then preferred to the High Court. By this time the record relating to this suit along with the records of many other suits were

destroyed by fire which broke out in the court of the Sub-judge at Bhaderwah. However Kilam J. who heard the second appeal remanded the suit

to the trial court on 10-1-2006 for fresh disposal with the direction that the trial judge should ascertain whether the sale by Suraj Ram was to

discharge antecedent debts. The trial court heard the suit again and arrived at the finding that the sale was for antecedent debt which was not

immoral or illegal and that it was consequently binding on the Plaintiffs who were the sons of Suraj Ram. It also held that the Land Alienation

Regulation did not affect the sale because a decree for specific performance had been passed before that Regulation came into force. On these

findings, the suit was dismissed.

The Plaintiffs appealed to the Addl. District Judge at Jammu who agreed with the trial court that the sale by Suraj Ram was to discharge

antecedent debts and that it was binding on the Plaintiffs who were his sons. But he found that the sale was invalid because it contravened the

provisions of the Land Alienation Regulation. In accordance with the provisions of that Regulation, he declared that Sukhnu Shah should be treated

as a mortgagee for a period of 20 years. Sukhnu Shah has come up in second appeal against this decision.

The first question that falls for consideration is whether the sale in the present case is hit by the provisions of the Land Alienation Regulation. For

this purpose, we shall assume that this regulation which declared sales of land by agriculturists to non-agriculturists invalid, came into force after the

decree was passed in the suit for specific performance and before the sale deed was executed by the court in execution of that decree. The learned

Counsel for the Appellant has urged that the Land Alienation Regulation could not affect the vested right which the Appellant obtained under the

decree for specific performance in his favour. He would even go further and say that even if there was no decree for specific performance, the

mere pendency of an action in court for the enforcement of the agreement to sell in his favour was sufficient to take the case out of the operation of

the statute which came into force subsequently. On the other hand, the learned Counsel for the Respondent strenuously urged that the crucial point

of time is the date when the sale deed was executed in favour of the Appellant in execution of the decree for specific performance. As the Land

Alienation Regulation was in force on that date, the sale deed executed by the court in favour of the Appellant automatically fell within it's mischief

and could not convey any right or title to the Appellant. We have to ascertain which of these two rival contentions is correct.

Even before the Land Alienation Regulation came into force, the Appellant had obtained a right under the decree for specific performance in his

favour. This decree had admittedly become final even before the coming into force of the Land Alienation Regulation. It can scarcely be doubted

that the right which the Appellant thus acquired was a vested right in the eye of law. The Land Alienation Regulation was not made retrospective

either expressly or by necessary intendment. It cannot, therefore, be given a retrospective operation so as to affect vested rights. But the contention

on behalf of the Respondents is that by declaring that the sale deed which the Appellant obtained in execution of the decree for specific

performance was hit by the provisions of the Land Alienation Regulation which had by then come into force, no retrospective operation will be

given to that Regulation because the execution of the sale deed by the court took place when the Regulation was in force. This contention does not

appear to be well-founded because acceptance of it would amount to nothing less than giving a retrospective operation to the law which was

enacted much after a vested right accrued in favour of the Appellant.

The learned Counsel for the Respondents would then urge that it is permissible in a case like this to give such a retrospective operation to the

Land Alienation Regulation because it would other wise be ineffectual in respect of all pending actions and even agreements for sale which were

previously entered into.

I do not think this contention is warranted by authority or justified in principle. It has been held in a long catena of decisions, both English and

Indian that where an enactment prejudicially affects vested rights or the legality of past transactions or impairs contracts, it should not be given a

retrospective operation so as to affect vested rights, in the absence of express words or clear intention manifest in the statute itself. Every statute, it

has been held, which takes away or impairs vested rights acquired under existing laws, or creates a new obligation, or imposes a new duty or

attaches a new disability in respect of transactions or considerations already past, must be presumed out of respect to the legislature, to be

intended not to have a retrospective operation (vide Maxwell on Interpretation of Statutes, 10th ed. page 215.)

So careful are the courts in endeavouring to protect vested rights that we find that in several cases Judges have refused to allow statutes to have

retrospective operation, although their language seemed to imply that such was the intention of the legislature, because if statutes had been so

construed, vested rights would have been defeated.

In Gardner v. Lucas (1878) 3 A.C. 582 at p. 603 Lord Blackburn stated the rule of law in the following words with regard to the effect of a

statute upon a transaction past and closed.

Where"" said he, ""the effect would be to alter a transaction already entered into, where it would be to make the valid which was previously invalid-

-to make an instrument which had no effect at all and from which the party was at liberty to depart as long as he pleased, binding--I think the prima

facie construction of the Act is that it is not to be retrospective, and it would require strong reasons to show that it is not the case."" (See Craies on

Statute Law, 5th ed. page 369).

There are two well-recognized principles (1) that vested rights should not be presumed to be affected and (2) that the rights of the parties to an

action should ordinarily be determined in accordance with the law as it stood at the date of the commencement of the action. This second principle

is perhaps even more inflexible than the first. That is why one usually finds a statute intended to be made applicable even to pending actions using

language expressly referring to pending actions. In the absence of such express language or unmistakable intendment made manifest in the statute

itself, a statute should not be construed as affecting pending actions.

There is a long line of English authorities bearing on this point. In Moon v. Durden (1848) 2 Ex. 22, a new Act (Gaming Act, 1845) which was

passed while an action was pending was held not to be retrospective in its effect so as to defeat that action, even though Section 18 had said ""no

suit shall be brought or maintained for recovering money etc."" The words ""or maintained"" would ordinarily have been held to be applicable to a

pending suit. Nevertheless Parke B. remarked:

It seems a strong thing to hold that the legislature could have meant that a party who under a contract made prior to the Act had as perfect a title to

recover a sum of money as he had to any of his personal property should be totally deprived of it without compensation.

Similarly, in Smithier v. National Union of Operative Plasterers (1909) 1 K.B. 310 Section 4, Trade Disputes Act 1906, was interpreted as not

preventing a court from disposing of an action begun before the passing of that Act although Section 4 had enacted ""an action for tort against a

trade Union shall not be entertained by any court.

Again in Bedling v. Goll (1922) 39 TLR 128, the Gaming Act, 1922, which had repealed a section of the earlier Gaming Act, was held by the

court of appeal not to operate to put an end to the pending action, even though it had enacted that ""no action for the recovery of money under the

said section shall be entertained by any court.

In Henshall v. Porter (1923) 2 K.B. 193, the court went further and held that the Gaming Act of 1922 did not prevent the bringing of an action

under the repealed section of the older Act, even after the date when the Repealing Act came into force in respect of a cause of action which had

arisen before that date.

In Colonial Sugar Refining Co. v. Irving (1905) AC 869 an application was made to the Privy Council to dismiss an appeal from the judgment

of the Supreme Court of Queensland on the ground that the power of the court below to give leave to appeal had been abrogated by Section 39

of the Australian Commonwealth Judiciary Act. The action in which the appeal was brought was commenced on 25-10-1902. The judiciary Act

came into force on 25-8-1903, and the leave to appeal was given on 4-9-1903. The judicial Committee dismissed the application. Lord

Macnaghtan observed as follows:

As regards the general principles applicable to the case there was no controversy. On the one hand, it was not disputed that if the matter in

question be a matter of procedure only, the petition is well-founded. On the other hand, if it be more than a matter of procedure, if it touches a

right in existence at the passing of the Act, it was conceded that, in accordance with a long line of authorities extending from the time of Lord Coke

to the present day, the Appellants would be entitled to succeed. The Judiciary Act is not retrospective by express enactment or by necessary

intendment. And therefore the only question is, was the appeal to his Majesty in Council a right vested in the Appellants at the date of the passing

of the Act, or was it a mere matter of procedure? It seems to their Lordships that the question does not admit of doubt. To deprive a suitor in a

pending action of an appeal to a superior tribunal which belonged to him as of right is a very different thing from regulating procedure. In principle,

their Lordships see no difference between abolishing an appeal altogether and transferring the appeal to the new Tribunal. In either case there is an

interference with existing rights contrary to the well-known general principle that statutes are not to be held to act retrospectively unless a clear

intention to that effect is manifested.

In AIR 1927 242 (Privy Council) . Lord Blanesburgh in delivering the judgment of the Judicial Committee stated the law in the following

words:

The principle which their Lordships must apply in dealing with this matter has been authoritatively enunciated by the Board in (1905) AC 369,

where it is in effect laid down that while provisions of a statute dealing merely with matters of procedure may properly, unless that construction be

textually inadmissible, have retrospective effect attributed to them, provisions which touch a right in existence at the passing of the statute are not to

be applied retrospectively in the absence of express enactment or necessary intendment. Their Lordships can have no doubt that provisions which,

if applied retrospectively would deprive of their existing finality orders which when the statute came into force, were final are provisions which

touch existing rights,

These authorities have been followed in a long course of decisions in India. Reference may be made to Ramakrishna Aiyar Vs. Sithai Ammal, ;

Daivanayaga Reddiar and Others Vs. Renukambal Ammal, ; Ram Singha and Another Vs. Shankar Dayal and Another . Kripa Singha v. Ajaipal

Singh ILR Lah 165 : AIR 1928 Lah 627 (FB), Sadar Ali and Others Vs. Doliluddin Ostagar, and Radhakisan v. Sridhar Ramchandra ILR 1950

Nag 532 : AIR 1950 Nag 177 (FB). These decisions enunciate the principle that a right of appeal is vested right and that it accrues to a litigant on

the date the action is commenced, and that it can be taken away only by a subsequent enactment which expressly or by necessary intendment so

provides and not otherwise. The position has been re-affirmed and established beyond doubt by the Supreme Court in its recent decision in

Garikapatti Veeraya Vs. N. Subbiah Choudhury, .

14a. In the face of these weighty decisions, the contention of the learned Counsel for the Respondents that the Appellant's valuable right which was

in existence when the Land Alienation Regulation came into force must be deemed to have been substantially impaired or totally abrogated by that

Regulation, although it did not say so either by express enactment or by necessary intendment, cannot be accepted.

I may also refer to Surindra Nath v. Saralia Hindi Mahajani School AIR 1950 EP 282. In that case one Bishan Das who belonged to the

community of Gour Brahmins mortgaged his property on 5-5-1934. At that time Gour Brahmins were not declared to be agriculturists for

purposes of the Punjab Alienation of Lands Act. But on 18-9-1934 that community was notified as agriculturists u/s 5 of that Act. The question

that tell for decision was whether the subsequent declaration of the members of his community as agriculturists gave Bishan Das who executed the

mortgage prior to the date of. the Notification any immunity from having his property sold in execution of the decree obtained on the mortgage.

In other words, the question was whether a retrospective operation could be given to the Notification issued u/s 5 of the Punjab Alienation of Land

Act. A Division Bench of the East Punjab High Court held that the Notification could not be given retrospective operation and that the property

mortgaged was therefore liable to be sold in execution of the mortgage decree. The reasoning was that the right of the mortgagee to recover his

debt by sale of the mortgage property was a subsisting right and could not be jeopardised by a subsequent Notification or statute unless that

Notification or statute was expressly or by necessary intendment given a retrospective operation.

It is thus clear that the right which the Appellant obtained under the decree for specific performance which was founded on a valid agreement

for sale executed in his favour by the father of the Respondents was not affected by the Land Alienation Regulation which subsequently came in- to

force.

There is another aspect of the matter to be noticed. Bhadarwah where the land in question is situated, and where the parties reside, was what

is described as a jurisdictional Jagir. It is unnecessary to go into the history of its origin or to trace its essential features. Suffice it to say that for

administrative purposes Bhadarwah had its own separate revenue and judicial administration. All the same, it was part of the State of Jammu and

Kashmir. It did not have the status of an independent State or even the trappings of sovereignty. All the laws which were in force in the rest of the

State were not however, brought into operation in Bhadarwah.

It appears that several Acts were extended to that area by Special proclamations and Notifications issued either by the Jagirdar or by the

Maharaja. In the absence of any such proclamation or Notification the law in force in the rest of the State did not operate in Bhadarwah until 8-6-

1986 when Maharaja Hari Singh by a Royal Proclamation terminated the separate administration then obtaining in Bhaderwah and brought it under

the same administrative set-up as prevailed in the rest of the State. That was the effect of the proclamation dated 8-6-1986. But this proclamation

did not, and could not have the effect of applying all the laws which existed in the rest of the State to Bhadarwah also. The first Land Alienation

Regulation of 1972 which applied only to certain specified areas of the State, namely, Mirpur Bhimber and Ranbirsinghpura Tehsils, did not

admittedly apply to Bhadarwah. But in 1980 that Regulation was extended to the whole of the then Jammu Province.

It can only mean to the Jammu Province under the direct administrative control of the Maharaja and not Bhadarwah which was under a separate

administrative set up. The position of Bhadarwah in 1986 when the Royal Proclamation was issued abolishing the separate administrative set up in

Bhadarwah, was that the Land Alienation Regulation did not apply to it. No doubt, the Jammu Alienation of Land Act 1990 which extended to the

entire Jammu province can well be taken to have comprehended Bhadarwah also. But for the purpose of the present case, it is not material

because the sale deed in favour of the Appellant was executed by the court on 23-3-1988, and was registered on 21-6-1988. It is therefore

obvious that the enactment of 1990 could not affect that sale. It is equally clear that the sale deed obtained by the Appellant was not hit by the

Land Alienation Regulation either.

But the learned Counsel for the Respondents contended that by the mere proclamation of 8-6-1986 all the laws in force in the rest of the State

must be held to have been automatically applied to Bhadarwah. This is clearly not warranted by the proclamation which only purported to put an

end to the status of Bhadarwah as a separate administrative unit. Nor can the mere circumstance that Bhadarwah was administratively

amalgamated with the rest of the State effect an automatic extension of all the laws in the State to Bhadarwah in which only a certain chosen laws

were in operation at the time of the amalgamation.

The Respondents' learned Counsel then invited attention to Section 11 of the Shri Pratap Laws Consolidation Act, 1977 which says ""All Acts

now in force or hereafter to be enacted shall unless otherwise expressly provided, extend to. the whole of the Jammu and Kashmir State."" But it is

seen that the words ""all Acts now in force or hereafter to be enacted"" were substituted by Act 11 of 1996 for the words ""an enactment embodied

in Schedules 2 and 3 of this Regulation."" And the schedules did not admittedly include the Land Alienation Regulation of 1972 as applying to

Bhadarwah. It did not apply to Bhadarwah at any time before or on the dates when the sale deed was executed and registered in favour of the

Appellant. The finding of the Addl. District Judge that the sale fell within the mischief of the Land Alienation Regulation or the Land Alienation Act

is therefore plainly erroneous.

The other point urged by the Respondents is that the sale in favour of the Appellant was not for any antecedent debt. Both the courts below

have clearly arrived at the finding that the consideration for the sale was to discharge an antecedent debt which the father of the Plaintiffs owed the

Appellant. This debt was not tainted with immorality or illegality and was antecedent in fact as well as in time. The mere fact that the debt was

owed to the same person in whose favour the agreement to sell was executed is not at all a ground for holding that the debt was not truly

antecedent. The learned Counsel for the Respondents next urged that the finding of the lower appellate court was not arrived at after a discussion

and consideration of the evidence in the case. But the trial court had gone into the question in sufficient detail and held 'hat the sale was for paying

off an antecedent debt. The appellate court concurred in the finding of the trial court.

It was not necessary for the appellate court in such a case to have repeated what the trial court had said, before agreeing with it although in a case

where the appellate court reverses a finding of fact of the trial court it should ordinarily state at sufficient length the reasons for its arriving at a

different conclusion on a consideration of the entire evidence and the probabilities of the case. It is not necessary that it should go into an equally

detailed discussion when it agrees with the finding of fact of the trial court. This part of the judgment of the lower appellate court being one of

affirmance, it was not necessary for it to deal with the matter in dispute at the same length as would be necessary in a judgment of reversal vide

Mahendra Nath Bhunia and Others Vs. Ashutosh Pradhan and Others, and AIR 1933 6 (Nagpur) .

In the instant case, I do not see any good reason to disturb the concurrent finding of fact arrived at by the courts below. Indeed, it is not

permissible in a second appeal to canvass the correctness of a concurrent finding of fact.

It follows from the foregoing that the appeal has to be allowed. I make no order as to costs.