Walzi Chhatri vs Ganpat Singh

Manohar Lall, J.—This is an appeal by the plaintiff who has been refused a foreclosure decree on the foot of a mortgage executed by the respondent, an occupancy tenant, and involves the consideration of a number of Sections of the Central Provinces Tenancy Act (Act 11 of 1898). The appeal was in the first instance heard by my learned brother sitting singly, but as he felt doubts as to the correctness of the decision of Rowland J., in Parameshwar Prasad Vs. Walji Chhatri, he referred the case to be heard by a Division Bench. The facts necessary to understand the nature of the controversy are these: The land formerly belonged to one Bhimsen Panda from whom the defendant purchased it on 28th February 1923 for a sum of Rs. 75 by a sale deed (Ex.A). That sale deed recited that that Bhimsen sold the .31 acre of land (Dewar settlement plot No. 939) out of his raiyati holding. In the year 192S what is known as Hamidt Settlement took place, and in the khatian (Ex. C) which was finally published in that year the defendant was recorded as an occupancy raiyat in respect of this .31 acre of land now bearing plots Nos. 2426 and 2427. It should be stated here that on the back of the sale deed (Ex. A) there is an endorsement (EX. 3) dated January 1924 to the effect that the Court of Wards, who is the landlord of the holding, waived its claim to recovery of possession by reason of the transfer on receipt of Rs. 25 as compensation and also the rent of the land which was originally one anna has been enhanced to Rs. 2 besides 1 anna 6 pies as cess.

On 16th April 1934 the plaintiff advanced a sum of Rs. 550 to the defendant on the foot of a mortgage bond on the security of these lands and after the due date he instituted the suit on 13th September 1987 for foreclosure. The defence to the action was that the full amount of Rs. 550 was not advanced by the plaintiff but only a sum of Rs. 275 and further that this sum has been paid off to the plaintiff by means of some adjustment.

The Courts below have concurrently come to the conclusion that this defence has not been established and have passed a decree for a sum of Rs. 770 in favour of the plaintiff, but they have refused to pass a foreclosure decree on the ground that Section 46, Central Provinces Tenancy Act, (hereinafter to be called the Act) operates as a bar to grant of this relief to the plaintiff; hence the appeal to this Court. The learned Munsif held that plots Nos. 2426 and 2427 constitute the rayati holding of the defendant. He refers to the evidence of Shraddhakar (P.W. 3) that formerly the land was raiyati and the defendant had constructed a houso on a portion thereof but the remaining portion is bari and paddy is grown there occasionally. He also refers to some receipts in which it is stated that rent was realised by the landlord in respect of the defendant''s raiyati land. He also refers to the evidence of the two witnesses on behalf of the defendant who proved that in the bari portion paddy is grown by the defendant.

In view of these facts, he came to the conclusion that these two plots constituted the raiyati holding of the defendant and, therefore, held that the mere fact that after the purchase from Bhimsen Panda the defendant has built a house on a portion of his raiyati holding was not sufficient to lead to the conclusion that it has been diverted into a non-agricultural tenancy. The learned District Judge examined the same facts and held:

In any case, the purpose for which this holding is now being used is not mainly an agricultural one. On the evidence, I think, it must be conceded that the main purpose for which the respondent has this land is not agricultural.... I agree that the fact that they (that is to say, the Court of Wards) claimed and received compensation goes to show that in the opinion of the Court of Wards the land had been diverted from an agricultural purpose and the Court of Wards had acquired a right of suit u/s 87(1). The question for my consideration is what is the effect of the acceptance of compensation on the status of the respondent. Admittedly he was originally an occupancy raiyat. Admittedly the Court of Wards thought that it had a right to eject him. Admittedly it waived that'' right on receipt of compensation and on the respondent agreeing to pay an enhanced rent which enhancement appears to have taken place somewhere about the same time.... It appears to me that permanency is the real mark of an occupancy tenant and that so long as the tenant has a permanent right to remain upon the land subject to payment of rent, he must be deemed to be an occupancy tenant rather than any other tenant.... I therefore find that the respondent remained an occupancy tenant and on that finding I am bound to hold that Section 46, Tenancy Act, applies.

Section 2, Sub-section (5) of the Act defines ''land'' to mean land which is let or occupied for agricultural purpose or for purposes subservient to agriculture, and includes the sites of buildings appurtenant to such land. It was, therefore, argued that where land has been diverted to non-agricultural purposes, Section 46 of the Act has no application and, therefore, the mortgage is a good mortgage notwithstanding the prohibition contained in that section. Attention was also drawn to the provisions of Section 52 which provides that notwithstanding any contract to the contrary or any provision of a record of rights, an occupancy tenant shall not be ejected from his holding by his landlord as such except as provided by the two sub-clauses.

Sub-clause 2 provides that he can be so ejected in execution of a decree of a civil Court obtained by the landlord on the ground of his having diverted the land to non-agricultural purposes. It is enough to say that this Section has no application to the facts of the present case because the suit giving rise to this appeal is not a suit by the landlord on the ground that the tenant has diverted his land to non-agricultural purposes. Rowland J., in Parameshwar Prasad Vs. Walji Chhatri, observed at page 63 that where land ceases to be connected with agricultural holding and becomes a residential house Section 46 of the Act does not apply at all. But, in the second part of the same judgment, he appears to hold that if there had been a decree for sale of the right of the same occupancy tenant of his holding, it would have been in contravention of Section 46(2) of the Act. The question for consideration before him was in an appeal by a judgment-debtor who had mortgaged his tiled house standing on a certain plot to the respondent who sued to foreclose the mortgage and obtained a decree for foreclosure and possession. The judgment-debtor objected at the time of delivery of possession that the property was his occupancy holding and was not transferable u/s 46. The decree-holder had resisted this objection on the ground that it was not maintainable in the executing Court as it could not go behind the decree which has already been passed in favour of the decree-holder, and, secondly, that the lands were not the occupancy tenancy of the objector. The decision of the Munsif who had allowed the application of the judgment-debtor was reversed by the Subordinate Judge who held that as the judgment-debtor was not an occupancy tenant he could not object to the delivery of possession. It was on these facts that Rowland J., made the observations which I have referred to above. It should also be stated here that the Subordinate Judge held that the lands had ceased to be connected with any agricultural holding, and, therefore, Section 46 of the Act did not apply. This view was apparently accepted by Rowland J.

With respect I do not agree with this view. The Act applies to a particular holding--in that case an occupancy holding--where by Section 44 a tenant has held the land continuously on the first day of January 1884 for a period of twelve years, otherwise an absolute occupancy tenant and every person who at the commencement of the Act, or thereafter, becomes a tenant, The other provisions of the Act including Section 46 then are applicable so long as such a tenant is in possession of the land. Section 46 and other provisions of the Act in chapter 4 will continue to apply to him and in particular Section 52 which gives the landlord a right to eject him only if he obtains a decree on the ground that the tenant has diverted the land to non-agricultural purposes. How can the Act cease to apply to such a tenant the moment he diverts his land to non-agricultural purposes? Otherwise, Section 52 would become redundant. The very fact that this Section gives a special remedy to the landlord shows that such a tenant remains an occupancy tenant within the meaning of Chap. 4, and if the landlord does not institute a suit against him on the ground Of his having diverted the land to non-agricultural purposes the tenant remains a tenant and gets the protection provided by the other provisions to be found in Chap. 4. The Section is like a forfeiture Clause in a lease which can be availed of by the landlord subject again to the restrictions mentioned in Section 87.

Section 46 of the Act, therefore, applies. By Sub-section (8) it has enacted that no occupancy tenant shall be entitled to sell, make a gift of, or mortgage his right in the holding, and every such sale, gift or mortgage shall be voidable in the manner and to the extent provided by Sections 47 and 48. The mortgage, therefore, in this case, if valid, could be only avoided under Sections 47 and 48. But sub Section (5) further enacts that notwithstanding anything contained in the Registration Act, 1908, no officer empowered to register documents shall admit to registration any document which purports to transfer the right of an occupancy tenant in this holding. In this case the mortgage bond has been registered, although there is no recital in it that it purports to transfer the right of the occupancy tenant to a person who, if he survived the tenant, would inherit the right of. occupancy or is a person in favour of whom as a cosharer the right of occupancy originally arose or who became by succession a cosharer therein. The registration was in violation of the clear prohibition by the statute and disobedience of that provision, in my opinion, renders the registration as null and void. This provision is in marked contrast with the other provisions in Sub-sections (8) and (4), which provide distinctly that a violation of the provisions will make the transfer voidable in the manner and to the extent provided by Sections 47 and 48. The document, therefore, is not effective as a mortgage document and the plaintiff is not entitled to a foreclosure decree.

But it was argued on behalf of the appellant that where registration has been effected, the only remedy is that the landlord or the person who would be entitled to the holding in the event of his death without nearer heirs must proceed as provided by Sections 47 and 48. Attention may also be drawn to the provisions of Section 95 of the Act which lays down that the jurisdiction of the civil Court is barred in such cases, and the remedy is only with the Court of the revenue officer. I do not agree with this contention, because where the statute contains a clear prohibition that no document shall be admitted to registration the mere fact that a registering officer admits it to registration cannot clothe the transferees with any rights which can be enforced in Courts of law. Take the case of a mortgage of property situated in Bihar but the document is registered in Bengal by the addition of an undivided part of one room of a house situated in a Bengal village. If a property is intended to be given in security in the province of Bengal, the document, although registered in Bengal, will affect property both in Bengal and in Bihar. But it has been held by their Lordships of the Judicial Committee in a number of cases starting from the case in Harendra Lal v. Haridasi Debi AIR 1914 P.C. 67 that such a registration will be treated as invalid as it amounts to a fraud on registration. Similarly, where the Act contains a prohibition that no officer shall admit to registration, in my opinion it follows that he has no jurisdiction to register if the document which is sought to be registered purports to transfer the right of an occupancy tenant. The registration, therefore, gives no title to the plaintiff.

It was then argued that there is an estoppel created by the act of the defendant in this case, and he cannot be allowed to raise this point. To that the respondent replied that there can be no estoppel against a statute. I am aware of a number of decisions of the Calcutta High Court, dealing with a similar situation under the Bengal Tenancy Act, where it has been held that although there is no estoppel against a statute but a party to a document may be estopped from putting forward the fact that he was or was not an occupancy tenant. But in this case no case of estoppel based on any assertion or mis-representation was set up; but, on the other hand, each party wanted to prove that the transferor in this case was or was not an occupancy tenant within the meaning of chap. 4 of the Act.

As it has been found as a fact that the transferor was an occupancy tenant, no question of estoppel arises, and the document of transfer ought not to have been registered u/s 46(5) with the result that the plaintiff cannot enforce his rights in this foreclosure. If it is assumed that the transferor was not an occupancy tenant, then he would be an ordinary tenant to which the provisions of Chap. 7 would apply. Section 70 contains provisions similar to those in Section 46 and Section 70(5) is on the same lines as Section 46(5). Sections 47 and 48 are reproduced by Sections 71 and 72 mutatis mutandis. Even in that case the plaintiff would be unable to enforce his rights in this foreclosure.

It is important to observe that in chap. 3 which deals with absolute occupancy tenants there is no provision similar to the one which is found in Section 46(6) or Section 70(5). The word "foreclosure" is mentioned in Section 41(5) and Section 41(7) provides that any transfer made in contravention of this Section shall be voidable at the instance of the landlord. Why then was it thought necessary by the Legislature to insert a special provision for the protection of the occupancy tenants and, ordinary tenants in Section 46(5) and Section 70(5)? Obviously it was the intention to effectively protect these two classes of tenants because the Legislature was not content with describing the transactions as vodable transactions only which could be set aside at the instance of the landlord or the heir who succeeds on intestacy by application to the revenue Courts, but they inserted the special provision forbidding a registering officer from admitting such a document to registration. Such a prohibition, so carefully drafted and inserted must be enforced by giving full effect to the intention of the Legislature.

From whatever point of view I look at the question, I reach the same result, namely, that the plaintiff was rightly refused a foreclosure decree for possession. The position perhaps would have been entirely different if the plaintiff had actually obtained possession by means of a transfer. But I would reserve the right to examine the position which would thus arise if the possession had been taken by the transferee on the foot of a document of transfer which was registered by the registering officer in violation of the provisions of Section 46(5) and Section 70(5).

The result is that, though for reasons different from those which commended themselves to the Courts below, I would affirm their decision and dismiss this appeal, but, in the circumstances, I would direct that the plaintiff and respondent will bear their own costs of this Court and of the Court of the learned District Judge. I do not interfere with the order for costs which has been made by the learned Subordinate Judge.

Brough, J.

I agree.