ORDER A. P. Sen, J.- l. This appeal under Order XLIII Rule 1 (u) of the Code of Civil Procedure, filed by the State of Madhya Pradesh, is directed against the order of the District Judge, East Nimar, Khandwa, dated 5th April, 1967, reversing the order and final decree of the IInd Civil Judge, Class IT, Khandwa, dated 30th June 1966. 2. The material facts are these. One Rao Subhag Singh filed a suit for declaration that certain Otlas situate in the Abadi of Mouza Godagpura in Khandwa Tahsil belongs to him, for a perpetual injunction for restraining the State of Madhya Pradesh and Janapada Sabha, Khandwa, from interfering with his rights over the same, and for rendition of accounts of the profits accruing there from in the Kartiki fair of 1951 and the Shivratri fairs of 1952 and 53. Eventually, the suit was decreed by the Additional District Judge, Khandwa, and it was affirmed by this Court (Pandey, J) in Stale of Madhya Pradesh vs. Rao Sobhagsingh, S. A. No. 379 of 1957, decided on the 17th August 1962 subject to this variation that the Janapada Sabha was held not liable to render accounts of the profits earned. Thereafter, Rao Sobhagsingh applied under Order 20, Rule 12 of the Code, for a final decree. This application was opposed by the State of Madhya Pradesh and Janapada Sabha on the ground that the Sabha had alone realised the profits, and, therefore, the State could not be asked to render accounts. The Sabha, however, claimed that by virtue of this Court's decision (supra) it had been absolved of liability for rendition of accounts, and, therefore, no final decree for an account of profits, even though the profits were realised by it, could be passed. They, accordingly, prayed for dismissal of the application. 3. The Court of first instance upheld these contentions and dismissed the application. Rao Sobhagsingh then filed an appeal before the District Judge. The Court below has held that the State of Madhya Pradesh, having allowed the Janapada Sabha to realise the profits, was liable to render accounts. It held that the liability to render account of the profits realised arises in equity.
Rao Sobhagsingh then filed an appeal before the District Judge. The Court below has held that the State of Madhya Pradesh, having allowed the Janapada Sabha to realise the profits, was liable to render accounts. It held that the liability to render account of the profits realised arises in equity. The State of Madhya Pradesh has, accordingly, been saddled with liability to render account of all profits which the Janapada Sabha might with ordinary diligence have received from the Kartiki fair of 1951, and the Shivratri fairs of 1952 and 53. 4. The appeal must be allowed for reasons I shall presently state. The expression "mesne profits" is defined in section 2 (12) of the Civil Procedure Code, as meaning as those profits which the person in wrongful possession of property. (a) actually received, or (b) might with ordinary diligence have received, therefrom. Now, in the plaint, there was a prayer for rendition of accounts of the profits, falling under category (a), i.e., of profits "actually received". The relevant portion of the plaint confining the claim, reads as under :- "15. That the plaintiff tentatively values the claim for "profits, wrongfully received" by the defendants at Rs. 500/- for November 1951, February 1952 and February 1953 as the plaintiff has no means "to ascertain the actual realisation made by defendant No.2" during these periods and prays an enquiry be made for the same from 21-10-51 to the date of the institution of the suit till the date of decree under Order 20 Rule 12 Clause (6) C.P.C." The underlined (here italicised) portion clearly limits the claim for rendition of accounts of profits. 5. Apart from this, the decree passed by the Additional District Judge is not silent as regards the nature of profits in respect of which account is to be rendered. The terms arc not ambiguous hut clear and explicit, they read: "4.
5. Apart from this, the decree passed by the Additional District Judge is not silent as regards the nature of profits in respect of which account is to be rendered. The terms arc not ambiguous hut clear and explicit, they read: "4. It is further ordered and decreed that the defendants do render an account of "the profits of these Otlas recovered by them" in the Kartik fair of 1951 and Shivratri fair of the years 1952 and 1953 and for that purpose the Lower Court shall make an enquiry or appoint a Commissioner to fix the liability of amount" Now, it is well settled that where the preliminary decree contains a direction as to mesne profits, that would be binding on the parties at all subsequent stages, though it may be erroneous. (See, Mahant Narayanna Vs. Board of Trustees, AIR 1959 AP 54. 6. In view of the direction in tile decree, the Court below was not right in widening the scope of enquiry under Order 20, Rule 12, of the Code, in directing for rendition of accounts into profits which might with ordinary diligence had been received from the fairs during the relevant years. Now, if on a true interpretation or the terms of the decree, the rendition of accounts had to be limited to the profits "actually received", then on its terms, there can be no order passed under Order 20, Rule 12 of the Code, against the State of Madhya Pradesh because admittedly the State had not appropriated to itself any part of the profits during the years in question. 7. Even otherwise, if it is assumed that some kind of vicarious liability arises because the State had arranged the fairs or because it exerts supervisory control over the Sabha, that also is hardly of any avail. In Secretary of Stale Vs. Saroj Kumar, AIR 1935 PC 49, their Lordships of the Privy Council have indicated the true measure to be the rents and premiums.
In Secretary of Stale Vs. Saroj Kumar, AIR 1935 PC 49, their Lordships of the Privy Council have indicated the true measure to be the rents and premiums. While laying down that where possession has been taken on behalf of the Government of property which is the subject matter of private ownership without lawful authority, their Lordships stated that the Government must be held answerable to the party aggrieved in the same way as a trespasser, but the Government is, however, not liable for failure to realise the highest possible rates of rents and premia from the tenants settled on the land, and is answerable only for such fair return as has been realised, stating:- Even so, on the tams of the definition of mesne profits, what the plaintiffs have to show is that, with reasonable diligence, more might have been realised then was actually realised by the revenue authorities in the way of profits, which terms includes both rents and premia, if any. As to what amounts to due diligence in their Lordship’s opinion, the person in wrongful possession is not liable for failure to realise tae highest possible rates of rent and premium from the tenants It is enough if taking account of both rent and premium, if any, a fair return has been realised from the land, and their Lordships will deal with the case on that basis in considering whether the plaintiffs have shown that there has been a want of reasonable diligence on the part of the defendant. The plaintiff has failed to show that there was any want of reasonable diligence on the part of the State of Madhya Pradesh as a prudent and fair minded person could be expected to show in dealing with his own property in the matter of realisation of rents. The right of holding the fairs was a statutory right which the Sabha was exercising on its own authority. The State Government had not framed out the right to the Sabha nor was it acting by leave and licence of the Government and there was thus no question of realising any rents and premia from the Sabha much less of realising more than what was fair and equitable.
The State Government had not framed out the right to the Sabha nor was it acting by leave and licence of the Government and there was thus no question of realising any rents and premia from the Sabha much less of realising more than what was fair and equitable. In the circumstances, it must, accordingly, be held that no direction against the State of Madhya Pradesh can be made for rendition of accounts because the State admittedly had not relised from the Sabha any rent or premium. 8. The result is that the appeal succeeds and is allowed with costs. The order passed by the District Judge is set aside and that of the Civil Judge is restored, dismissing the application under Order 20, Rule 12 of the Civil Procedure Code filed by the plaintiff, for drawing up a final decree for rendition of accounts. Counsel’s fee Rs. 100/-, if certified.