Chameli Devi v. Jyotish Chandra Srivastava — 1967 DIGILAW 439 (ALL)

JUDGMENT Mathur, J. - This is a Second Appeal by Smt. Chameli Devi decree holder, against the order of the Civil Judge of Allahabad allowing the appeal of Jyotish Chandra Srivastava, respondent No. 1, and thereby dismissing the execution application. 2. The house in suit belonged to Brij Bahadur Lal, father of Shambhunath, respondent No. 2, and others, Brij Bahadur Lal executed a document of 26.6.1940 with regard of the house in favour of Behari Lal for a sum of Rs. 2,250/-. The document purports to be sale deed with a condition of repurchase by the vendor. As appears from the judgment of the lower appellate Court, the parties have regarded this as a mortgage by conditional sale. On the same date, Brij Bahadur Lal executed a 'Kabuliat' having obtained the house on lease. There is a stipulation in the 'Kabuliat' that the 'tenant' can sub-let the accommodation. It was on 8.4.1958 that Behari Lal's sons transferred their interest in the house in favour of Smt. Chameli Devi. On 25.5.1960 Smt. Chameli Devi served a notice on Jyotish Chandra Srivastava calling upon him to pay rent directly to her, but this notice was not acted upon by any one. Jyotish Chandra wanted Smt. Chameli Devi to have her title adjudicated upon by the courts of law as the rent was being demanded by Shambhu Nath son of Brij Bahadur Lal also. 3. After serving a combined notice under Section 3 of the U.P. (Temporary) Control of Rent and Eviction Act and under Section 106 of the Transfer of Property Act on Shambhu Nath and others, Smt. Chameli Devi instituted the present suit against them (Shambhu Nath others) for the recovery of the arrears of rent and for ejectment. Jyotish Chandra Srivastava was not served with any notice nor was he impleaded in the suit. The suit was instituted in 1965. On 8.4.1965 Shambhu Nath and others transferred their interest in favour of Smt. Chameli Devi on receipt of an additional consideration of Rs. 7,000/-. Thereafter, they did not contest the suit and in fact, filed a compromise on the basis of which the suit was decreed both for ejectment and the arrears of rent. In the compromise deed it was mentioned that Jyotish Chandra Srivastava had given his consent to vacate the accommodation. However, there was a clause that the Judgment Debtor shall render assistance in giving possession to her. In the compromise deed it was mentioned that Jyotish Chandra Srivastava had given his consent to vacate the accommodation. However, there was a clause that the Judgment Debtor shall render assistance in giving possession to her. 4. Smt. Chameli Devi, thereafter applied for the execution of the decree against Jyotish Chandra Srivastava, alleging him to be a sub-tenant bound by the decree and liable to ejectment in execution thereof. The executing court issued a warrant for delivery of possession. Jyotish Chandra obstructed the execution of the decree. The decree holder then complained that the execution of the decree for possession had been obstructed and police aid was necessary. At the same time Jyotish Chandra Srivastava moved an application for inquiry of his rights alleging that he was a statutory tenant and not bound by the decree obtained against Shambhu Nath and others. The Additional Munsif dismissed the objection holding that the decree was binding on Jyotish Chandra Srivastava and he was liable to ejectment in execution of the decree. Jyotish Chandra Srivastava went up in appeal, which, as already mentioned above, was allowed and the decree was held to be incapable of execution against him. 5. The first point raised on behalf of the appellant is that the order of the executing court was not appealable and hence the decree of the lower appellate court is without jurisdiction. Even if the order of the executing court was not appealable, this Court must consider the propriety of the Munsif's order; whether that order can be challenged in revision. In case it is found that the Munsif's order was without jurisdiction or is such which can be interfered with in revision, this Court can, while setting aside the order of the Civil Judge, suitably modify the Munsif's order also. In other words, the appellant cannot succeed simply because the order passed was not appealable, and it is necessary to go into the merits of the case. 6. The parties to this proceeding had regarded the transaction of 1940 to amount to mortgage by conditional sale. Considering the consideration of that transaction, this view is correct. We can, therefore, start with the assumption that the document amounts to a mortgage by conditional sale. 6. The parties to this proceeding had regarded the transaction of 1940 to amount to mortgage by conditional sale. Considering the consideration of that transaction, this view is correct. We can, therefore, start with the assumption that the document amounts to a mortgage by conditional sale. However, in the interest of Jyotish Chandra Srivastava we can consider the question in the alternative as if the transaction can be regarded as an outright sale with an agreement for re-purchase. 7. In case the transaction amounts to mortgage by conditional sale, Brij Bahadur Lal, and on his death his sons Shambhu Nath and other, would be mortgagors and Behari Lal, and thereafter Smt. Chameli Devi, mortgagees. This state of affairs shall continue till the parties seek remedy for the termination of the mortgage, the mortgagee for the realisation of the amount advanced and the mortgagor for redemption. The lower appellate court was under a wrong impression that for the period stipulated for the reconveyance of the property, the mortgagor had the status of an owner. However, on the date of the execution of the mortgage by conditional sale, the mortgagor executed a Kabuliat as a result of which he became a tenant. In a similar case of an usufructuary mortgage accompanied with a lease in favour of the mortgagor, the status of the mortgagor while occupying the building was held to be of a tenant. See K.S. Mian Feroz Shah v. Sohbat Khan, AIR 1933 PC 178 .. An usufructuary mortgage does not become a simple mortgage simply because the mortgagor continued in possession though after the execution of a lease. In the eye of law, the transaction amounts to an usufructuary mortgage though from the date of the Mortgage the mortgagor in possession of the property acquires the status of a tenant. The same rule can be applied to a mortgage by conditional sale. In other words, from the date of the execution of the document of 1940, Brij Bahadur Lal, and on his death Shambhu Nath and others, were mortgagors in so far as the mortgage by conditional sale was concerned; but their possession or occupation of the house was as a tenant. They occupied the dual position of a mortgagor and tenant for the use and occupation of the mortgaged property. 8. The same deed of 8.4.1965 does not indicate which rights were being transferred. They occupied the dual position of a mortgagor and tenant for the use and occupation of the mortgaged property. 8. The same deed of 8.4.1965 does not indicate which rights were being transferred. Consequently, in case the document of 1940 amount to a mortgage by conditional sale, the sale deed of 1955 shall be a document of transfer of the equity of redemption as a result of which Smt. Chameli Devi became the full owner of the property. But if the sale deed is read along with the compromise filed in the ejectment suit, it can be held that Shambhu Nath and others agreed not to press their tenancy rights and they had no objection to the suit for ejectment being decreed. 9. In case the document of 1940 is held to be an out and out sale with a condition of repurchase, Smt. Chameli Devi would be the owner of the house and Shambhu Nath and others, tenants thereof. However, the rights which Smt. Chameli Devi had in the house were not free from doubts. Due to the rise of prices of buildings Smt. Chameli Devi could, in good faith to remove the doubts in her full proprietary rights, agree to pay extra money and obtain a transfer deed from the legal representatives of the vendor, making it clear that from that date they had no subsisting interest in the property. However, on reading the sale deed of 8.4.1965 along with the compromise in the suit the same opinion shall have to be formed as has already been indicated above. 10. This leads us to the consideration of the question whether the compromise, either read alone or along with the sale deed of 8.4.1965, amounts to surrender of tenancy rights by the tenant's namely Shambhu Nath and others. 11. An allotment order passed by the District Magistrate under the provisions of the U.P. (Temporary) Control of Rent and Eviction Act, cannot determine the title of the parties. The maximum that can be said is that for purposes of that Act Shambhu Nath and others were landlords and the intimation of the allotment order in favour of Jyotish Chandra Srivastava could be given to Shambhu Nath and others and not to Smt. Chameli Devi. The maximum that can be said is that for purposes of that Act Shambhu Nath and others were landlords and the intimation of the allotment order in favour of Jyotish Chandra Srivastava could be given to Shambhu Nath and others and not to Smt. Chameli Devi. To make this order complete, it may here be mentioned that for purposes of this Act, lease includes sub lease and in so for as the sub-tenant is concerned the tenant is the landlord. Further, after tenant was given the permission to sub-let the accommodation the District Magistrate could have, without any fresh permission of the owner, allotted the accommodation to a sub-tenant. 12. In case, in the eye of law, the tenant, namely, Shambhu Nath and others, had surrendered their tenancy rights, the sub tenant, Jyotish Chandra Srivastava, shall become tenant-in-chief and it shall not be possible for Smt. Chameli Devi to execute against him the decree obtained against the tenants only. But if the transaction does not amount to surrender of tenancy rights, the sub-tenant shall be liable to eviction. 13. Their lordships of the Supreme Court had the occasion to consider a similar question though thereunder the matter raised was whether the decree obtained by the owner was collusive. This is the case of Rup Chand Gupta v. Raghuvanshi (P) Ltd., 1964 SC 1889. The decree in that case was held not to be collusive because the sister purpose or motive had not been established. It was observed that :- 'Thus the mere fact that the defendant agrees with the plaintiff that if a suit is brought he would not defend it, would not necessarily prove collusion. It is only if this agreement is done improperly in the sense that a dishonest purpose is intended to be achieved that they can be said to have colluded." 14. Where the defendant has no good ground of defence, it is always in his interest to come to terms with the plaintiff. Either the plaintiff can be allowed to obtain an ex-parte decree or a compromise arrived at and the suit decided on the basis of the compromise. The existence of a compromise decree cannot, therefore, by itself establish collusion between the parties. Surrender of rights need not be collusive :- One can on his own surrender the tenancy rights. Either the plaintiff can be allowed to obtain an ex-parte decree or a compromise arrived at and the suit decided on the basis of the compromise. The existence of a compromise decree cannot, therefore, by itself establish collusion between the parties. Surrender of rights need not be collusive :- One can on his own surrender the tenancy rights. However, once the surrender of such rights is collusive, it can be said without any hesitation that not only were the tenancy rights given up but there was, in the eye of law, surrender of such rights. In the instant case, the tenants-in-chief, namely, Shambhu Nath and others, were in arrears of rent exceeding there months and the arrears of rent was not paid within the prescribed period of the service of notice of demand under Section 3 of the U.P. (Temporary) Control of Rent and Eviction Act. The contract of tenancy was between the owner and the tenants-in-chief and it was not necessary to give a similar notice to the sub-tenant. When these two factors were evident and could not be challenged in defence, the tenants-in-chief could assume that the bar imposed by Section 3 stood removed and they could, on the service of a notice under Section 106 of the Transfer of Property Act, be ejected from the house. The notice under Section 106 is on the record and it is valid. In other words, the tenants-in-chief could raise no good defence and irrespective of whether they contested the suit or not a decree for ejectment would have ben passed against them. In the circumstances, it was not necessary for the tenants-in-chief to contest the suit and, instead, they could come to terms with the owner to avoid being encumbered with costs of the litigation. The compromise could not, in the circumstances of the case, be regarded as surrender of tenancy rights. When, in the eye of law, there was no surrender of tenancy rights by the tenants, namely, Shambhu Nath and others the sub-tenant, Jyotish Chandra Srivastava, shall not be entitled to the benefit of Section 115 of the Transfer of Property Act. 15. The compromise could not, in the circumstances of the case, be regarded as surrender of tenancy rights. When, in the eye of law, there was no surrender of tenancy rights by the tenants, namely, Shambhu Nath and others the sub-tenant, Jyotish Chandra Srivastava, shall not be entitled to the benefit of Section 115 of the Transfer of Property Act. 15. A new point, namely, the effect of Section 65-A of the Transfer of Property Act was raised for the first time in this Second Appeal in support of the contention that the lease in favour of Jyotish Chandra Srivastava was binding on the mortgagee and the former shall enjoy the status of a tenant and no of a sub-tenant. Sub-section (1) of Section 65-A runs as below :- "65-A. (1). Subject to the provisions of sub-section (2) a mortgagor, while lawfully in possession of the mortgaged property, shall have power to make leases thereof which shall be binding on the mortgagee". The sub-section details the power of the mortgagor to make leases of the mortgaged property. It is true that no restriction has been imposed on the nature to possession of the mortgagor; what has to seen is whether he was lawfully in possession of the property; but the power contemplated by the sub-section is a power exercisable by the mortgagor as such and not in any other capacity. By virtue of the sub-section a leases executed by the mortgagor shall, if there is no infringement of the provisions of sub-section (2) thereof, be binding on the mortgagee. A person can occupy more than one status. Consequently, in determining the rights and liabilities of the parties one must look into what that their interse status as to the matter under consideration is and not what others status they also enjoy. In the instant case Shambhu Nath and others were not only mortgagors but also tenants-in-chief of the mortgagor property. Even though they also enjoyed the status of a mortgagor, they had, in the eye of the law, leased out the mortgaged property as tenants-in-chief and not as mortgagor. When for purposes of the lease Shambhu Nath and others were tenants and Jyotish Chandra Srivastava a sub-tenant, their rights and liabilities shall be determined by this status and not any other status the tenants enjoyed. When for purposes of the lease Shambhu Nath and others were tenants and Jyotish Chandra Srivastava a sub-tenant, their rights and liabilities shall be determined by this status and not any other status the tenants enjoyed. In my opinion, therefore, even though the words "lawfully in possession" are general the sub-section read as a whole can lead to no other interpretation except that the mortgaged property should have been leased by the mortgagor as such and not by the same person holding the property as a tenant. In the circumstances the sub-lease in favour of Jyotish Chandra Srivastava shall not be binding on the mortgagee. A similar view was expressed in Amirt Lal v. Chintaman, 1959 MPC 317. 16. Jyotish Chandra Srivastava shall not be in a position to avail of the benefit of Section 65-A on any other ground also, namely, that the lease was not in accordance with the provisions of sub-section (2) thereof. The words "contain" and "covenant" have been used in this sub-section. Covenant is invariably though not always, in writing. However, the word "contain" suggests that the agreement must be in writing. In the instant case no written lease or Kabuliat had been executed. When no lease as contemplated by sub-section (2) was executed, the provisions of sub-section (1) shall be inapplicable and oral lease shall not be binding on the mortgagee. 17. There other points were also raised on behalf of Jyotish Chandra Srivastava firstly, that the appellant, having not moved an application under Order 21, Rule 97, CPC., could not obtain ejectment of the sub-tenant in the present execution proceeding; secondly, that the admission of the appellant's husband makes it clear that there was surrender of the tenancy rights; and thirdly, that on account of the dismissal of the Second Appeal as against Shambhu Nath and others it could not proceed against the sub-tenant, namely, Jyotish Chandra Srivastava. 18. From, the application, dated 1.6.1965 of Jyotish Chandra Srivastava it is evident that the Amin had gone to the house on 27.5.1965 to deliver possession in execution of the decree. The decree holder moved an application for police held on 31.5.1965 and this application also makes it clear that the Amin was not permitted to execute the decree. 18. From, the application, dated 1.6.1965 of Jyotish Chandra Srivastava it is evident that the Amin had gone to the house on 27.5.1965 to deliver possession in execution of the decree. The decree holder moved an application for police held on 31.5.1965 and this application also makes it clear that the Amin was not permitted to execute the decree. The application dated 31.5.1965 was made after resistance was put in the execution of the decree; and the request made therein was for disregarding this obstruction by permitting police help and by also permitting the Amin to break open the locks. In other words, even though the application was not in the usual form in which an application under Order 21, Rule 97, CPC is made, yet for all the practical purposes the application moved on 31.5.1965 was and can be regarded as such an application. 19. Whether the compromise does or does not amount to surrender of tenancy rights has already been considered above from both the angles. For reasons given above it does not, in the eye of low, amount to surrender. Consequently the use of the word "surrender" by a law man, cannot be utilised to hold that there was, in the eye of lay, surrender of tenancy rights. 20. The execution of the decree was never opposed by the tenants, Shambhu Nath and others. The execution of the decree was resisted by Jyotish Chandra Srivastava only. When the main disputant was Jyotish Chandra Srivastava, the appeal can proceed even though it has been dismissed as against the tenants-in-chief. 21. The Second Appeal is hereby allowed with costs of al the Courts and the order under appeal is set aside while that of the Munsif is restored. The execution shall now in accordance with the law. The record shall be returned to the court below at an early date.