BHARGAVA, J.—This is an appeal by the defendant from the judgment and decree dated 19.1.1963 of the District Judge, Udaipur, arising out of a suit for recovery of Rs. 16,828. 2. Shortly stated the case of the plaintiffs in the court below was that on 1st May, 1948 they took a lease of a Cinema house known as Sumer Talkies situated at Kishengarh from Maharaja Sumersingh of Kishengarh for a period of five years on a monthly rent of Rs. 2500. On 6th August, 1948, it was orally agreed between the plaintiffs and the defendants at Udaipur that the said Cinema house be sublet to the defendants on the same terms and conditions on which they had taken it from Maharaja of Kishengarh. On 7th August, 1948, in pursuance of the said oral agreement possession over the Cinema house was delivered to the defendants and they also executed an agreement on 10th August, 1948, at Kishengarh by which they undertook to pay the monthly rent of Rs. 2500 directly to Maharaja of Kishengarh, and in case they committed default of any of the conditions of the sub lease, they would be responsible for the damages sustained by the plaintiffs The defendants continued in possession of the cinema house up to 16th April, 1949 when it was closed because of a fire having broken out in it. The defendants, however, did not pay rent to the Maharaja of Kishengarh from 1.11 48 to 16 4 49 as a result of which Maharaja of Kishengarh instituted the suit for recovery of arrears of rent amounting to Rs. 13833.5.3 against the plaintiffs as well as the defendants. The above suit was decreed only against the plaintiffs but was dismissed against the defendants because it was held that there was no privity of contract between the Maharaja of Kishengarh and the defendants. Maharaja of Kishengarh in execution of the decree recovered from the plaintiffs Rs. 7000 on 26th April, 1958, Rs 4000 on 3rd July, 1959, and Rs. 2690 on 8th September, 1960 The plaintiffs, therefore, claimed that they were entitled to recover the above sum from the defendants together with interest amounting to Rs.
Maharaja of Kishengarh in execution of the decree recovered from the plaintiffs Rs. 7000 on 26th April, 1958, Rs 4000 on 3rd July, 1959, and Rs. 2690 on 8th September, 1960 The plaintiffs, therefore, claimed that they were entitled to recover the above sum from the defendants together with interest amounting to Rs. 1739 and other expenses which they had to incur in the litigation with Maharaja of Kishengarh on the ground that the defendants had committed a breach of the terms of the agreement, and that they were liable to idemnify the plaintiffs on that account. 3. The defendants contested the suit. They stated that both the agreements dated 1st May, 1948, executed by the plaintiffs in favour of Maharaja of Kishengarh and 10th August, 1948 executed by the defendats in favour of the plaintiffs were inadmissible in evidence for want of registration and the plaintiffs were debarred from enforcing their terms. It was stated that there was oral agreement between the parties that unless the agreement dated 10th August, 1948, was duly registered its terms would not be enforced. The defendants admitted that they were put into possession of the Cinema House and it is no longer in dispute that their possession continued up to 16th April 1949, but their case is that they were in possession as agents of the plaintiffs and not as sub -lessees. Objection regarding the jurisdiction of the court to entertain the suit was also raised on the ground that no oral agreement took place at Udaipur as alleged by the plaintiffs. Bar of limitation and res judicata were also pleaded. 4.
Objection regarding the jurisdiction of the court to entertain the suit was also raised on the ground that no oral agreement took place at Udaipur as alleged by the plaintiffs. Bar of limitation and res judicata were also pleaded. 4. On the above pleadings, the lower court framed the following issues:— ^^¼1½ D;k oknhx.k us rk- 1-5-1948 dks tks flusek ukeh lqesj Vkdht dks pykus ds fy;s 2500½ :- ekgkokj esa egkjktk lkgc fdkux<+ ls 5 lky ds fy;s fdjk;s ij fy;k vkSj fdjk;snkjh dk ,d bdjkj rk- 1-5-1948 dk egkjktk lkgc lqesjflagth ds ge esa fy[k fn;k vkSj mUgha krksaZ ij oknhx.k us izfroknh dks dj fn;k\ ¼oknh½ ¼2½ D;k oknhx.k vkSj izfroknhx.k ds njfe;ku fdjk;snkjh dh krZ rk- 6-8-48 dks mn;iqj esa tckuh r; ikbZ vkSj mlh ds vuqlkj rk- 7-8-48 dks izfroknh fdkux<+ tkdj flusek gkml dk dCtk fn;k\ ¼oknh½ ¼3½ D;k izfroknhx.k us rk= 10-8-1948 dks fyf[kr bdjkj flusek gkml dks fdjk;s ij nsus dk fy[k fn;k\ ¼oknh½ ¼4½ D;k izfroknhx.k us flusek gkml ds eqrkfyd oknhx.k dk gj izdkj dh {kfr ls eqDr djus dh ftEesnkjh vius Åij ys yh vkSj mlds vuqlkj 2500½ :- ekgokj ls rk= 10-8-48 dks bdjkj ds vuqlkj flusek gkml dk fdjk;k mudks egkjktk lkgc fdkux<+ dks vnk djuk FkkA ¼oknh½ ¼5½ D;k oknhx.k us mDr flusek gkml dk fdjk;k 13690½ :- rkjh[k 8-2-60 rd egkjktk lkgc fdkux<+ dks vnk dj fn;k tks izfroknhx.k ls ikus ds vf/kdkjh gS\ ¼oknh½ ¼6½ D;k oknhx.k dks izfroknhx.k ls mDr flusek gkml ds fdjk;s ds o gjtkus ds dqy feykdj 16928½ :- olwyh dk vf/kdkj gS\ ¼oknh½ ¼7½ vxj rudhg ua- 2 oknhx.k ds gd esa QSlyk gks rks D;k nkok ml U;k;ky; ds T;wfjlfMDku dk ugha gS\ ¼izfroknhx.k½ ¼8½ D;k nkok ckgj fe;kn gS\ ¼9½ D;k rk- 10-8-48 o rk- 26-8-48 ds nLrkostkr jftLVªh kqnk u gksus dh lwjr esa dkfcy vnkky gS\ ¼oknhx.k½ ¼10½ vxj rudhg ua- 9 oknhx.k ds gd esa QSlyk gks rks D;k fdkux<+ esa fy[kk gqvk rk- 10-8-48 dk bdjkj ds oDr njfe;ku Qjhdsu ;g r; gqvk fd fdjk;s ukesa dh krZ gS mldh jftLVªh djk nsaxs vkSj mlds ckn gh ftEesnkjh izfroknhx.k ij tk;n gksxh vFkok ugha\ ¼11½ D;k izfroknhx.k dk dCtk mDr flusek gkml ij crkSj oknhx.k ds ,tsUV ds ugha jgk\ ¼oknhx.k½ ¼12½ D;k oknhx.k dks okn uEcj 17 lu~ 1947 flfoy tt U;k;ky; fdkux<+ rFkk vihy uEcj 48 lu~ 1955 gkbZ dksVZ tks/kiqj ds QSlys ds ckn oknhx.k ;g nkok ugha yk ldrs gS\ ¼izfroknhx.k½ ¼13½ D;k izfroknhx.k dks [kjpk 35 ¼,½ ds rgr feyuk pkfg;s ¼izfroknh½ 5.
In support of the above issues, plaintiffs Chimanlal and Ratanlal gave their own statements and examined Madanlal P. W. 3, Shankerlal P. W. 4, Madanlal S /o Motilal P. W. 5 and Kesrisingh P. W. 6. In rebuttal, Shankerlal defendant gave his own statement as D. W. 1 and examined Meghraj, D. W. 2, Ballabhdas D. W. 3 and Sumersingh D. W. 4. Besides the above oral evidence, both parties produced documentary evidence. The learned District Judge upon a consideration of the above evidence came to the finding that the plaintiffs took lease of the cinema house from Maharaja of Kishengarh and that it was further sub-let to the defendants by the plaintiffs on the same terms and conditions on which they had taken it from the Maharaja. On issue No. 2 it was found that the terms and conditions for sub-letting the Cinema house to the defendants were settled on 6th August, 1948, and possession over the cinema house was delivered to them on 7th August, 1948, and thereafter the lease-deed was executed on 10th August, 1948. Issue No. 3 was also decided in favour of the plaintiffs and on issue No 4 it was held that the agreement dated 10th August, 1948, entered into between the parties contained a clear recital that the defendants would indemnify the plaintiffs for all loss and injury suffered by them on account of the said agreement. Even otherwise it was held that where a conveyance contains a covenant by the sub-lessee to pay off rent direct to the superior landlord, it impliedly gives rise to a contract of indemnity. On issues Nos. 5 and 6, it was held that the plantiffs were entitled to recover a sum of R. 13690 which they had to pay to the Maharaja of Kishengarh under the decree obtained against them. On issue No. 6 the court only allowed the plaintiffs claim of Rs. 1739 for interest on the sum of Rs 13690 and disallowed the other amount claimed in the suit. Issue No. 7 was decided in favour of the plaintiffs and it was held that the court at Udaipur had jurisdiction to entertain the suit. The suit was also held to be within time as being governed by art.83 of the Indian Limitation Act, 1908.
Issue No. 7 was decided in favour of the plaintiffs and it was held that the court at Udaipur had jurisdiction to entertain the suit. The suit was also held to be within time as being governed by art.83 of the Indian Limitation Act, 1908. As regards issue No. 9 which has been the subject matter of lenghy arguments in this Court, the learned District Judge in view of the judgment of the High Court between the parties in D. B. C. Regular Appeal No. 48/955 decided on 8.3.1950, decided it against the defendants. Issues Nos. 10 and 11 were decided against the defendants. Issue No, 18 was also decided against the defendants and it was held that the suit is not barred on the ground of res judicata. As a result of the above findings, plaintiffs were given a decree for Rs. 15120 with proportionate costs and pendente lite and future interest at the rate of 6 per cent, per annum. 6. In this appeal, objection regarding jurisdiction of the lower court to entertain the suit was given up because the lower court did not suffer from any inherent lack of jurisdiction and no prejudice was caused to the defendant on account of the suit being tried by that court. It was, however, contended that (1) the suit for enforcing the indemnity clause in the agreement Ex. 2 dated 10th August, 1948, is not maintainable because the agreement of lease was not admissible in evidence for want of registration and the indemnity clause was an integral part of the agreement and as such could not be regarded as a collateral transaction, (2) that Art 83 of the Limitation Act was not applicable to the facts and circumstances of the case and the suit was barred by limitation because it was only a suit for recovery of rent which could have been filed within three years from the accrual of the cause of action and (3) that the suit was also barred on the principle of res judicata. 7. On the other hand, learned counsel for the respondent has urged that the agreement Ex. 2 is not inadmissible in evidence because it has not been shown that any law of registration containing provisions similar to sections 17 of the Indian Registration Act was in force in the erstwhile Kishengarh State when the said document was executed.
7. On the other hand, learned counsel for the respondent has urged that the agreement Ex. 2 is not inadmissible in evidence because it has not been shown that any law of registration containing provisions similar to sections 17 of the Indian Registration Act was in force in the erstwhile Kishengarh State when the said document was executed. In the alternative it was urged that the terms and conditions of sub-letting the Cinema House were orally settled between the parties on 6th August, 1948, and possession was delivered on 7th August, 1948, and thereafter the agreement was executed on 10th August, 1948, and it is simply a record of the past transaction and therefore is admissible in evidence. It was also urged that the present suit can be decreed against the defendants on their admissions and it was not necessary to call in aid the agreement Ex. 2. In this connection, it was lastly urged that the indemnity clause in Ex. 2 is not an essential part of the sublease and can be enforced and the document is admissible for proving that term which is a collateral purpose. It was urged that in the present suit the document is admissible because it does not affect any immovable property and is not being admitted into evidence for any such transaction. The present suit is for enforce met of a personal obligation based upon a breach of contract. As regards the question of limitation, it was pointed out that the lower court has rightly applied Art. 83 of the Limitation Act to the facts of the case and the cause of action to institute the suit arose when the plaintiff was demnified. As for the plea of res-judicata, it is urged that the question involved in the present litigation was not necessary to be decided in the previous suit filed by Maharaja of Kishengarh against the plaintiff and the defendants nor was that question decided. The only question that was decided in that case was whether there was any privity of contract between the plaintiffs and the present defendants and that question having been found in favour of the present defendants, Maharaja Kishengarhs suit was dismissed against them and the decree for arrears of rent was passed against the plaintiffs only. 8. That there may be res-judicata as between co-defendants has been recognised by a long course of Indian decisions.
8. That there may be res-judicata as between co-defendants has been recognised by a long course of Indian decisions. But before the rule of res judicata be applied as between co-defendants the following three conditions are requisite: (1) there must be a conflict of interest between the defendants concerned (2) it must be necessary to decide this conflict in order to give the plaintiff the relief he claims and (3) the question between the defendants must have been finally decided. See Mt. Munni vs. Tirloki Nath(l) and Chandu Lal vs. Khalilur Rehaman(2). 9. Now in the previous suit instituted by Maharaja Sumer Singh of Kishengarh, the present plaintiffs were arrayed as defendants Nos 1 to 3 and the present defendants as No. 4 and 5 and the suit was for recovery of arrears of rent.The plea of defendants Nos. 1 to 3 was that the possession of defendants No. 4 and 5 over the Cinema House was with the direction of the plaintiffs and so they were only liable for payment of arrears of rent while defendants Nos. 4 and 5 asserted that there was no privity of contract between them and the plaintiffs with whom they had not entered into any transaction. The point in issue, therefore, in that suit was whether there was any privity of contract between the plaintiff and defendants Nos. 4 and 5 and this issue was decided in favour of defendants Nos. 4 and 5 and upon its decision the suit was dismissed against them. The terms of Ex. 2 and the indemnity clause did not come up for consideration in that suit nor was It necessary to consider it because Maharaja Kishengarh the plaintiff in that suit was not a party to Ex. 2 and therefore its terms and conditions were not binding on him. Even the rule of constructive res judicata as contended by the learned counsel has no application in the present case because even if the defendants Nos. i to 3 rested their defence on the indemnity clause contained in Ex. 2, the court would not have gone into that question because giving of relief to the plaintiff did not depend upon the determination of that question. It is, therefore, evident that the second and the third conditions are not satisfied in the case and the rule of res-judicata cannot therefore apply.
2, the court would not have gone into that question because giving of relief to the plaintiff did not depend upon the determination of that question. It is, therefore, evident that the second and the third conditions are not satisfied in the case and the rule of res-judicata cannot therefore apply. It was contended that in the previous suit the lower court had decided that the two documents i.e., the agreement of lease between the present plaintiffs and Maharaja Sumer Singh and the second agreement Ex. 2 between the plaintiffs and defendants were inadmissible in evidence for want of registration and could be admitted for collateral purposes only and that decision should operate as res judicata and issue No. 9 should not have been re-determined. But here too the learned counsel does not stand on a sound footing The order of the trial court did not finally decide the question of the registration of the two agreements because an appeal was preferred against the judgment of the trial court to the High Court and the High Court as would appear from its judgment dated 8 3.60 Ex. A-l left that question undecided because in its view a valid tenancy could be inferred from the circumstances of the case even if the lease deed was inadmissible for want of registration It was because of this decision that issue No. 9 was not pressed in the lower court. I, therefore, hold that the rule of res judicata or constructive res judicata has no application in the present case. 10. The next question is whether there was any law requiring compulsory registration of the agreement Exs.1 and 2, in force in the erstwhile Kishengarh State. Learned counsel for the appellant has failed to produce any enactment relating to the registration of documents in Kishengarh State but he has placed reliance upon a Robkar ( order ) published in Kishengarh State Gazette dated 1.4.1944, at p. 2 to show that the provisions of sec. 17 of the Indian Registration Act were being followed in that State. I would therefore assume for the purposes of this case that under the law of Registration in force in Kishengarh State, leases of immovable property from year to year or for any term exceeding one year or reserving a yearly rent required compulsory registration. 11.
17 of the Indian Registration Act were being followed in that State. I would therefore assume for the purposes of this case that under the law of Registration in force in Kishengarh State, leases of immovable property from year to year or for any term exceeding one year or reserving a yearly rent required compulsory registration. 11. But the learned counsel for the respondent urges that Ex.2 is not the transaction itself but is only a record of the past transactions. In support he relies on paragraphs 2 and 3 of the plaint wherein oral agreement of lease dated 6 8 48 between the parties has been specifically pleaded. It has also been alleged that possession over the Cinema House was delivered to the defendants on 7th August, 1948, i.e. two days before the execution of Ex 2. It is urged that the lower courts finding on these points is in favour of the respondent and it has not been challenged in this Court In my view the contention is not without force Apart from the finding of the lower court on this point, upon a true interpretation of the terms of Ex 2 it would be found that lease by oral agreement had come into being on 7th August, 1948. The following recital will bear this out: ^^pwafd vkils ;g Bsdk rkjh[k 7 vxLr lu~ 48 ls bu krksZa ds lkFk tks vkids vkSj Jheku~ egkjktk lkgc ds njfe;ku r; ik;h gS mu ij geus fy;k gS bl okLrs rk- 7 vxLr 48 ls dqfl;k kjk;rksa dh ikcanh gekjh tkr o [kkl o tk;nkn ij ykteh gksxhA The lease was therefore an oral one and Ex. 2 contained a recital of the factum of lease dated 7th August 1948, and in this view of the matter it would be admissible in evidence to corroborate the oral agreement. Though Ex. 2 was executed on 10th August, 1948, the terms and conditions of the lease are admitted in Ex. 2 to have become binding from 7th August. 1948 It is also the plaintiffs case that the terms and conditions of the lease were orally settled between the parties on 6th August, 1948, and possession over the Cinema House was delivered on 7th August, 1948 that is why the terms of lease became operative from 7th August, 1948. 12.
2 to have become binding from 7th August. 1948 It is also the plaintiffs case that the terms and conditions of the lease were orally settled between the parties on 6th August, 1948, and possession over the Cinema House was delivered on 7th August, 1948 that is why the terms of lease became operative from 7th August, 1948. 12. In Banarsilal vs. Shri Bhagwan (3) it was held that— "When the document was executed only by the lessee and not by the lessor and was unregistered it was held that it was not a lease deed and as such could not be admitted in evidence as proof of lease. It did not create a lease under sec. 107 of the Transfer of Property Act and therefore it would not be admissible as a lease-deed but if there was an oral agreement accompanied by delivery of possession, such a document could be admitted in evidence to corroborate the fact of such agreement and the terms thereof." The same view was taken in Raghbir Saran vs. Union of India (4). Ex. 2 also has been executed by the lessee only and not by the lessor. It has not been shown that there was any provision similar to sec.107 of the Transfer of Property Act in force in Kishengarh State at the time Ex. 2 was executed requiring the making of lease for any term exceeding one year only by a registered instrument. The plaintiff can therefore legitimately rely upon the oral agreement of lease accompanied by delivery of possession though it was for a term exceeding one year. 13. Learned counsel for the appellant contends that the suit is not based on the oral agreement of lease and is based only on Ex 2 and the lower court gave its finding on issue No. 2 only to decide the question of jurisdiction of the court to entertain the suit. Learned counsel further contends that evidence relating to the negotiations prior to the agreement of lease Ex 2 is inadmissible in evidence because of sec. 91 of the Indian Evidence Act as Ex. 2 is the sole repository of the terms of lease settled between the parties. Reliance is placed on the following decisions— Mt.
Learned counsel further contends that evidence relating to the negotiations prior to the agreement of lease Ex 2 is inadmissible in evidence because of sec. 91 of the Indian Evidence Act as Ex. 2 is the sole repository of the terms of lease settled between the parties. Reliance is placed on the following decisions— Mt. Raj Rani vs. Hukam Chand(5), Kuppuswami vs. Chinnaswami(6) Seetamma vs. Krishnaswamy Row(7), Jagwanti vs. Udit Narain(8), Punjab National Bank vs. Chaudhry(9) and Dula Mosh vs. Abdul Raheman In my view issue No. 2 is quite clear and explicit though upon its decision question of the jurisdiction of the court might have also rested. But the court has come to the finding that the terms and conditions of the lease were orally settled between the parties on 6th August, 1948, and possession was also delivered on 7th August, 1948. As already observed, the recitals of Ex. 2 also support the respondents contention of their having an oral agreement of lease prior to the execution of Ex. 2. The decisions relied on by the learned counsel relate to these cases where agreement itself represents the transaction between the parties and the prior negotiations are only a prelude to it or where oral evidence was sought to be given to prove the terms of the written contract requiring compulsory registration. Even if the agreement Ex 2 is not admissible in evidence for want of registration, it is well settled that it can be admitted in evidence under the proviso to sec. 49 for collateral purposes. Sec 48 lays down a rule of substantive law but the proviso embodies a rule of evidence. 14. The term "collateral purpose" is vague and has to be determined on the facts of each particular case. However, all purposes other than those which try to create, declare, assign, limit or extinguish right, title or interest in immovable property are collateral purposes. Learned counsel for the appellant cited a number of decisions to show that a lease deed requiring compulsory registration cannot be admitted in evidence for proving the period of lease, condition to vacate without notice and for recovery of rent because they are not collateral purposes. He contends that the indemnity clause contained in Ex.
Learned counsel for the appellant cited a number of decisions to show that a lease deed requiring compulsory registration cannot be admitted in evidence for proving the period of lease, condition to vacate without notice and for recovery of rent because they are not collateral purposes. He contends that the indemnity clause contained in Ex. 2 is also integral part of the agreement and is not separable from the other conditions of the sub-lease and, therefore, the agreement cannot he admitted for proving this condition also. Learned counsel for the respondents, however, urges that the condition to pay rent by the lessee directly to the superior landlord and in case of its breach to indemnify the lessor is not an essential part of the sub lease because such an agreement could have been entered into separately by an unregistered deed Besides this, it is argued that in the present litigation the agreement is not being produced for the purpose of affecting any immovable property or as evidence of any transaction affect such property or conferring such power. In the present case, it is the personal obligation to indemnify the lessor in case of breach of the terms of the lease which is to be enforced which does not in any way affect the immovable property and as such it can be admitted in evidence. Learned counsel urges that the indemnity clause contained in Ex. 2 is quite divisible from the other terms of the lease. Reliance is placed on Arseculeratne vs. Perera (11) and Muruga Mudaliar vs. Subba Reddiar (12). In the latter case it was held by the Full Bench that— "An agreement of lease in writing required to be registered but un-registered may be used as evidence of the agreement in a suit for damages for its breach." The point was referred to the Full Bench because there was some conflict of opinion in the two Full Bench decisions of that Court that is in Rajah of Venkatagiri vs. Narayana Reddi (13) and Narayan Chetti vs. Muthiah Servai (14). The learned Chief Justice expressed the view— My view of sec.49 (c), Registration Act is this. It prohibits the use of an unregistered document in any legal proceeding in which such a document is sought to be relied on in support of a claim to enforce or maintain any right, title or interest to or in immovable property.
The learned Chief Justice expressed the view— My view of sec.49 (c), Registration Act is this. It prohibits the use of an unregistered document in any legal proceeding in which such a document is sought to be relied on in support of a claim to enforce or maintain any right, title or interest to or in immovable property. So long as the document is not sought to be relied on as evidence of any right, title or interest to or in immovable property, there is nothing to prevent the document being received in evidence for other purposes. In this view, it may be that a distinction will have to be made between a suit for specific performance and a suit for damages. In a suit for specific performance, the relief sought does concern title to or interest in land; whereas a claim for damages is personal and may be enforced without in any manner affecting immovable property." The learned Chief Justice agreed with the view of the Full Bench in Rajah of Ven-katagiri vs. Narayana Reddi (supra) where the learned Judges had held that - "If the plaintiffs action was founded on an alleged title in virtue of a lease granted by the defendants.........there can be no doubt that the document VI could not be admitted in evidence. The plaintiff would then be seeking to use it as evidence of a transaction affecting immovable property. It is clear that the plaintiff does not assert his title under the incomplete lease, and that he does complain of the breach of contract on the part of the defendant in refusing to register the Kabuliat and give him a cowle, and also in disturbing his possession." The learned Chief Justice also observed that the observations of the Judicial Committee in M. E. Moolla Sons Ltd. vs. Burjorjee 15) do throw some light on the subject particularly in the manner of approach to the construction of the section. In the Privy Council case (15), their Lordships of the Judicial Committee dealt with the construction of sec.
In the Privy Council case (15), their Lordships of the Judicial Committee dealt with the construction of sec. 49 of the Registration Act and after examining the provisions observed— "Their Lordships are satisfied that there is nothing in the section cited when properly construed to compel the Court to take notice of the non-registration of an admitted document unless at any rate such document must, if treated as effective, be the foundation of a judgment affecting immovable property comprised in such document. Here the agreement has been admitted throughout. Indeed, it was first put in by the appellant. Further the proceedings do not in any respect affect any immovable property. The immovable property affected by the agreement long since passed out of the picture, and the only claim in these proceedings is a personal one for damages for breach of an admitted contract against an alleged undisclosed principal who denies he was a principal." From this judgment, two principles definitely emerge (1) that there can be no objection to admit a document in evidence for other purposes unless it is the foundation of a judgment affecting immovable property comprised in such document, or, in other words, the document on which the title claimed in the suit is based. Secondly there can be no objection to the admissibility of the document which is sought to be used as evidence of the personal claim eg., for damages for breach of an admitted contract. 15. The Privy Council decision (15) was also followed by A. N. Grover J. as he then was in Rattan Chan i vs. Bhagirath Ram (16) and he dissented from the view taken in Bahawal vs. Amrik Singh (17). The learned Judge observed after referring to the Privy Council decision (15) that— "The ratio of this decision is that an unregistered document admitted in proceedings relating to a personal claim and not affecting immovable property may be taken into consideration." Learned counsel for the appellant, however, contends that the aforesaid decisions have no relevancy in the present case because it is not a suit for damages on account of breach of the contract. I am unable to agree with this contention In Ex.
I am unable to agree with this contention In Ex. 2, the defendants gave on undertaking that if they will commit any breach of the terms of the agreement, they will be personally liable, and since they did not pay the rent directly to Maharaja of Kishengarh and thus committed a breach of the terms of the agreement and are therefore liable to indemnify the plaintiffs from whom the amount had been recovered under the decree obtained against them. In the present suit, therefore, the liability of the defendants arises on account of the breach of the terms of the agreement. At any rate, the judgment in the present case will not affect the immovable property and the document is used only for the enforcement of a personal claim arising out of the breach of the terms of the agreement. In view of the decision of the Privy Council there can be no objection to the admissibility of Ex. 2 in the present suit. In the present case also the defendant Shankerlal has admitted the execution of Ex. 2. He has also admitted that he had to pay Rs. 2500 as monthly rent of the Sumer Talkies to the plaintiffs. He has also admitted that he had started running the Cinema House from 7th August, 1918, and that he had taken the sub-lease on the same terms and conditions on which the plaintiffs had taken it from Maharaja Kishengarh He has also admitted that he undertook to pay rent directly to Maharaja of Kishengarh because the plaintiffs had told him that they were living at Udaipur and therefore he should pay the rent to the Maharaja Sahib. He has also admitted that he had paid Rs. 20,000 towards rent to the plaintiffs. On seeing Ex. 2, he stated that all its conditions were acceptable to him. He also admitted that he realised the income from the Cinema House as a sublessee during the period he was running it. Thus practically all the allegations made in the plaint are admitted by the defendant. 16. Learned counsel for the appellant says that all the admissions made by the defendant in his statement are inadmissible in evidence because they refer to the terms of the document which itself was inadmissible and, therefore, by virtue of sec.
Thus practically all the allegations made in the plaint are admitted by the defendant. 16. Learned counsel for the appellant says that all the admissions made by the defendant in his statement are inadmissible in evidence because they refer to the terms of the document which itself was inadmissible and, therefore, by virtue of sec. 91 of the Evidence Act the questions relating to the terms of the document ought not to have been allowed to be put to the appellant. But in view of my conclusion that the document is admissible in evidence for enforcing the personal claim arising out of the breach of the terms of the agreement, the admissions made by the defendant can be taken into consideration. 17. The only question which now remains to be considered is whether the suit is within limitation. This objection in this Court is solely based on the ground that if Ex. 2 for want of registration is not taken into consideration, then the present suit is, in substance, for recovery of nent, and having been instituted after the expiry of three years from the date when the rent became due is barred by limitation. In view of the finding that Ex. 2 is admissible in evidence and its terms can be looked into, this objection is not tenable. But even otherwise, both on the express terms of the agreement Ex. 2 as also by implication, when the defendants undertook to directly pay rent to the superior landlord, they are bound to demnify the plaintiffs and the cause of action for such a suit would take place when the plaintiffs were demnified. The learned District Judge has dealt with this question in detail and has also discussed the law in this connection. The present case rightly falls within tor ratio of the decision of Hamendra Nath Mukerjee vs. Kumarnath Roy (18) and Lachmi Missir vs. Deoki Kuar (19) The conclusion of the learned District Judge also finds support from the following decisions : Seetamma vs. Narayanamurthia(20) where it was held — "The cause of action on the breach of an indemnity clause in a contract arises when the party complaining of the breach is demnified.
A mere breach of one of the terms in the indemnity clause does not start the cause of action at once; it is open to the party to waive the right and to wait till he is demnified. Where there is a covenant to relieve a person from liability for debts contracted by the covenantor on behalf of the joint family of the parties by the covenantor undertaking to discharge them himself and where, in consequence of its breach, the other party has to meet a creditors suit and discharge the obligation, the cause of action for damages for the breach arises only when the plaintiff has to discharge the creditors decree." In Shanti Sarup vs. Janak Singh (21) it was held that— "Where a conveyance contains a covenant by the purchaser to pay off an encumbrance on the property sold, the failure of the purchaser to do so may give rise to two distinct causes of action. The failure of the purchaser to discharge the encumbrance within such time as is provided, expressly or by implication, in the conveyance entitles the vendor to bring an action to have himself put in a position to meet the liability which the purchaser has failed to discharge, and, secondly, if as a result of that failure the vendor incurs loss as a consequence of the incumbrancer recovering from the vendor the amount due under the mortgage,then the vendor is entitled to file a suit on the contract of in demnity. In the first of these cases, limitation will run under Art. 116 of the Limitation Act (or under Art. 115 if the sale deed is unregistered) from the date upon which the purchaser ought to have paid off the mortgagee; in the second it will, under Art.83, run from the date upon which the vendor is demnified. If the conveyance is registered the period of limitation is, under Art. 83 read with Art. 116. six years from the date upon which the vendor is demnified. It is immaterial in the latter case whether the conveyance contains an express covenant to indemnify, as, the purchasers covenant with the vendor to pay off the incumbrances as a contract of indemnity." I, therefore, concur with the finding of the learned District Judge that the present suit is within time and Art. 83 read with Art. 115 applied to it.
It is not disputed that if Art.83 governs the case, then the suit is within limitation. 18. The result, therefore, is that the appeal is dismissed with costs.