Chiranji Lal Khaitan & Ors. v. Moti Lal Saraogi

Supreme Court4 Aug 19711971 INSC 178 · [1972] 1 S.C.R. 221971 INSC 178

Case brief

AI extract

What is this about?

Transferred territories Bihar-West Bengal 1956; assimilation of laws; s.3(2) proviso cl.(a) saving of acts done under repealed laws; notice to quit s.106 Transfer of Property Act; six months' notice s.9(1)(b)(iii) West Bengal Non-Agricultural Tenancy Act 1949; s.88 pending suits/appeals; s.88 subject to s.3 of 1958 Act; compensation for superstructures only on termination under cl.(iii); ejectment decree restored; equitable estoppel concurrent finding of fact.

What did the court decide?

Appeal allowed; judgment and decree of the Calcutta High Court set aside and the decree of the trial court as affirmed by the first appellate court restored; parties to bear their own costs in this Court and in the High Court. ¶108

Chiranji Lal Khaitan & Ors. versus Moti Lal Saraogi — Supreme Court (1972) — LawSathi Research

What the court decided

AI extract

Outcome

¶108

Issue for consideration

Whether the plaintiff's suit for ejectment, validly instituted after a notice to quit under s.106 of the Transfer of Property Act, ceased to be maintainable for non-compliance with s.9(1)(b)(iii) of the West Bengal Non-Agricultural Tenancy Act, 1949 (read with s.88), having regard to s.3 of the West Bengal Transferred Territories (Assimilation of Laws) Act, 1958. +1 more

¶55

Court's answer

The provisions of the West Bengal Non-Agricultural Tenancy Act, 1949 did not apply to the 'transferred territories' on their own force; they were extended to those territories under the provisions of the 1958 Act, and therefore their application is subject to the conditions laid down by the 1958 Act.

¶100

Ratio / Principle

Because of cl.(a) of the proviso to s.3(2) of the 1958 Act, acts duly done under the repealed laws are protected; the quit notice given by the plaintiff under s.106 of the Transfer of Property Act was an act duly done under a repealed law, is protected, and its validity cannot be tested on the basis of the provisions of the 1949 Act.

¶100

Key takeaways

The interpretation protecting the pre-transfer notice advances public interest: otherwise all ejectment suits instituted before the transfer of territories would automatically fail for non-compliance with s.9 of the 1949 Act, a law not in force in the transferred territories before their transfer, a result the legislature would not have intended.ratio¶100
The liability to pay reasonable compensation for structures put up by the tenant arises under the proviso to cl.(iii) of s.9(1)(b) of the 1949 Act only when the termination of the tenancy is made under that clause and not otherwise; since the termination in this case was not made under that provision, the question of paying compensation does not arise.ratio¶106

Detailed headnote1 paragraphs

Chiranji Lal Khaitan v. Moti Lal Saraogi (Supreme Court of India, August 4, 1971 — K.S. Hegde and A.N. Grover, JJ.; judgment by Hegde, J.), Civil Appeal No. 1973 of 1966. Allowing the appeal by certificate and restoring the trial court's decree, the Court held: (i) the West Bengal Non-Agricultural Tenancy Act, 1949 did not apply to the 'transferred territories' on its own force but was extended there by the West Bengal Transferred Territories (Assimilation of Laws) Act, 1958, so its application is subject to the conditions of that Act; under cl.(a) of the proviso to s.3(2) of the 1958 Act, acts duly done under laws repealed in the transferred territories are saved — the plaintiff's notice to quit under s.106 of the Transfer of Property Act, given when that Act governed the area, was such a protected act and its validity could not be tested by s.9(1)(b)(iii) of the 1949 Act despite the wide terms of s.88; otherwise all pre-transfer ejectment suits would automatically fail, a result the legislature could not have intended. (ii) Liability to pay reasonable compensation for structures put up by the tenant arises under the proviso to cl.(iii) of s.9(1)(b) only where termination is under that clause; no compensation was payable here. Calcutta High Court's judgment and decree set aside; trial court decree (as affirmed in first appeal) restored; parties to bear own costs.

¶1

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CHIRANJI LAL KHAITAN & ORS.

MOTi LAL SARAOGI

August 4, 1971

[K. S. HEGDE AND A. N. GROVER, JJ.)

¶8

Bihar & West Bengal (Transferred Territories) Act. 1956-Wesl !8,ngal Transferred Territories (Assimilation of Laws) Act, 1958- West Bengel Non-Agricultural Tenancy Act, 1949-Suit for eject111e111 ·of' tenant filed in Bihar lerritory after notice under s. 106 of TP. ActSuit decreed-Appeal pending in Patna High Court-Territory transferred to West Bengal-Appeal transferred to Calcutta High Court -Suit whether liable to he dismissed for want of six months' notice .under s. 9(1J(h)(iii) of 1949 Act-Section whether made applicable hr s. 88 of that Act-Effect of s.3(2) of 1958 Act-No compensation for .superstructures payable when tenancy not terminated under s. 9(I)(b)(iiil.

¶9

The plaintiff (predecessor-in-interest of the appellants) leased a plot of land then situate in Bihar State to the defendant by oral lease in 1943. In 1947 without the plaintiff's knowledge the defendant built certain superstructures on the land. In 1948 the plaintiff asked him to remove the structures. On his failure to do so the plaintiff in 'September, 1948 gave him a notice to quit under s.106 of the Transfer of Property Act Thereafter he filed a suit which was decreed by the trial court in 1952. The first appellate court affirmed the decree. The .defendant's second appeal was pending in the Patna High Court when the area in question was transferred to West Bengal. Under the provisions of the Bihar & West Bengal (Transferred Territories) Act. 1956 the said appeal was transferred to the Calcutta High Court In 1958 the West Bengal Legislature enacted the West Bengal Transferred Territories (Assimilation of Laws) Act, 1958. The Calcutta High Court in 1965 set aside the decree and dismissed the plaintiff's suit because six months' notice as required under s.9(1 )(b}(iii) of the West Bengal Non-Agricultural Tenancy Act, 1949 had not been given. According to the High Court s.9 was made applicable by s.88 of the Act which was in wide terms. With certificate appeal against the judgment of the Calcutta High Court was filed in this Court. Allowing the appeal,

¶10

HELD : (i) The provisions of the 1949 Act did not apply to the ·'transferred terrirories' on their own force. They were extended to these territories under the provisions of 1958 Act. Section 3 of that Act while repealing the laws that were in force in the 'transferred territory' and extending the laws that were no force in the rest of West Bengal saved the previous operation of the existing laws so repe~led and further saved anything done or suffered under those laws. [28C-E]

¶11

In other words because of cl.(a) of the proviso to s.3(2) acts duly done under the repealed Jaws are protected. The quit notice given ·under 5.106 of the Transfer of Property Act by the plaintiff was an act •duly done under a repealed law and was therefore protected. Its

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CHIRANJI LAL KHAITAN v. MOT! LAL SARAOGI (Hegde, J.) 33

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' ~- •

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A validity could not be tested 011 the basis of the provision of the 1949 Act. Tkis interpretation advances public interest because otherwise all ejectment suits which had been instituted before the transfer of territories had been effected would automatically fail for non-compliance of s.9 of the 1949 Act, a law which was not in force in the transferred territory before their transfer. The legislature would not have H intended such a result. [28E-G]

¶23

(ii) The liability to pay reasonable compensation for the structures rut up by the tenant arises under the proviso to cl.(iii) of s,9(l)(b). That proviso imposes the liability to pay reasonable compensation for the structures put' up only when the termination of the tenancy is made under cl.(iii) of s.9(1)(b) and not otherwise. As the termination of the tenancy in the present case was not made under that provision the C question of paying compensation did not arise, [28H-29B]

¶24

C1v1L APPELLAfE JURISDICTION : Civil Appeal No. 1973 of 1966.

¶25

Appeal from the Judgment and decree dated August 30, 1965 of the Calcutta High Court in Appeal from AppelD late Decree No. 1033 of 1956.

¶26

V. S. Desai, Krishna Sen and B. P Maheshwari, for the appellants.

¶27

¶28

D. N. Mukherjee and A. G. Ratnaparkhi, for respondent No. l(a).

¶29

The Judgment of the Court was delivered by

¶30

Hegde,J.--This appeal by certificate arisesfromthedecision of the Calcutta High Court in its appellate decree No. I 033of1956. The appellants are the legal representatives F of the original plaintiff ChiranJi Lal Khaitan. The plaintiff was the owner of the suit property. According to the plaint case, .the plaintiff leased out the property described in Sch. III to the plaint, a vacant plot to the defendant in June 1943 on a monthly rental of Rs. 20/-. It was an oraI lease. The defendant took on lease. that property for the G · purpose of carrying on his motor business. But in the year 1947 without t!J.e plaintiff's knowledge the defendant constructed several. structures on the land. In 1948 the plaintiff asked him to remove those structures but the defendant diqnot comply with that demand, hence in September

¶31

. H 1948, the plaintiff served on him a notice to quit determining the tenancy with effect from the 1st Nov~mber, l948. As the defendant did not surrender possession of the property, the plaintiff instituted the suit from which this appeal

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3~M 1245 Sup CI/71

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[1972) I S.C.R.

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SUPREME COURT REPORTS

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arises on January 3, 1940 in the court of Munsif at Purulia. At the time of the institution of the suit, the suit property wa5 within the limits of the State of Bihar. The defendant resisted the suit on various grounds. The learned ·trial judge rejected all those grounds and decreed the· suit in May, 1952, as prayed for and direc'ed the defendant to deliver vacant possession of the suit plot after removing the structures put up by hint The decree of the trial court was affirmed by the !st appellate court on July 1(1952. Meanwhile in 1956, some of the bJrder areas of the Bihar State were transferred to the State of West Bengal as a result of the amendment of the Constitution. One of the areas that c stood transferred to the State of West Bengal is that concerned in the present litigation. The ttansfer in question. took place on November 1, 1956. The defendant filed a second appeal against the aforementioned decree in ; he High Court of Patna on September 7, 1956 and the sa:nc wa5 admitted by the High Court on September 10, 1956. That appeal stood transferred to the High Court of Calcutta under the provisions of the· Blhar and West Bengal Tran:efer of Territories Act, 1956, the Act under which the transfer of territories mentioned earlier took place. Part VH of that Act provided that the law then in force in the transferred territories Wa5 to continue until otherwise provided by the competent legislature or other co.m.petent authority. Jn 1958 the West Bengal legislature enacted the West Bengal Transferred Territories (Assimilation of.Laws) Act, 1958 (to be hereinafter referred to a"l the '1958 Act'). That Act came into force on July l, 1959. The second appeal filed by the defendant which had stood transferred to the Calcutta High Court came up for hearing before that court on August 10, 1965. Before the High Court the defendant's Counsel pressed for decision only two points viz. :

¶37

(I) That the plaintiff's claim is barred by equitab'.e estoppel and

(2) the suit is liable to be dismissed under s. 9 read with s. 80' of the West Bengal Non·agricukural Tena!lCy Act, 191f9 (to be hereinafter referted' to a5 the '1949' Act).

¶45

The High Court rejected the first co11tention. Agreeing with the courts below, it came to the cortclttsitm. that there is no reliable·evidence to show that the structures in question

¶46

¶47

CHIRANJI LAL KHAITAN v. MOT! LAL SARAOGI (Hegde, }.) . 25

¶48

A were put up either with the consent or knowledge of the plaintiff. But it a::cepted the second contention advanced on b~half of the defendant and dismissed·the suit. ·Hence this appeal.

}

, .._

All the courts bdow have concuri~ntly come to the. B conclusion that the defendanL has failed to establish his plea of equitable estoppel. That conclusion is hased on findings of fact. We see no (reason tO review those findings.

¶53

¶54

' The only question that we have to consider is whether c the High Court was right in holdllg that the suit for ,ejectment ought to fail fof non-complilmce of s. 9(l)(b)(iii): The High Court held that the plaintiff having failed, to give six months' notice b;!fore instituting the suit as required by the aforesaid provision, the suit is liable to be dismissed. It is urged on behalf of the appellants that s. 9 of the '1.949' 0 Act is not applicable to th~ facts of the case.

¶55

Before instituting the suit for ejectment the plaintiff had given a notice to quit under s: 106 of the Transfer of Property Act, the governing provision, at the time of the institution oLthe suit. It was not disputed that the notice E to quit in question at the time it was given was a valid notice. Therefore all that we have to see is whether because of the provisions of the '1949 Act' read with the provi sions ofthe·'l958 Act', the suitwhich was validly instituted has ceased' to be maintainable.

¶56

¶57

" We Have earlier seen that under the provisions of the Bihar and West Bengal (Transfer of Territoti~s) 'Act, 1956, the existing laws were continued till appropriate: provisions are made by the concerned legi;latures. Therefore s. 106 of the Transfer of Property Act continued to be in force in the areaconeetned till the.·'1958 Act'-cameinto force. SccG tion 3 of that Act provides :

¶58

"(n ·All •State laws wbich,.hrimediately before the appointed, day, extend to, or-are nof in· force in;.the State of West Bengal,.burdo not extend to, or are oot in force in, the taru;ferred' territories H shall ·.as· from that· day, euend to or; as the caes may be, come:i11to force in the transferred territories.

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(1972] l S.C.R

¶61

SUPREME COURT REPORTS

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Provided that the State Jaw specified in Schedule I shall extend to the transferred territories subject to the amendment specified in that .Schedule;

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(2) All State laws which, immediately before the appointed day are in force in the whole or any part of the transferred territories but not in the rest of West Bengal shall, on that day, stand repealed in the transferred territories :

{

Provided that such repeal shall not affect : (a) the previous operation of any State Jaw so repealed or anything duly done or suffered thereunder ; or

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(b) any right, privilege, obligation, or liability acquired, accured or incurred under any State Jaw so rerealed ; or

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'(c) any renalty, forfeiture or punishment incurred in respect of any offence ccrnmitted against any State· Jaw so repealed ; or

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(d) any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforemid ;

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and any such investigation, legal proceeding or remedy may be instituted, continued or enforced and any such penalty, forfeiture or punishment may be impmed, as if this Act had not been passed.; ...... ·

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(The remaining portion cf the section is not relevant for our present .purporn'.)

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1he expression "State Jaw" is defired· thus in s. 2(b) :

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" "State Jaw" means so mudi of any ·enactment, ordinance or regulation as ·relates to .any of.the matters enumerated in Lists II and III.in the Seventh Schedule tci the Constitution and include any order, by~law, r-ule, scheme, notification or other instrument having the force of law".

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Clill(AN,Jl LAL !;l!AlTAN l'. ll!Ol'I LAL SARAOG! (Hegde, J,) ;; 7

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A•

¶84

One of the statutes that stood extended to the transferred territories under the '1958 Act' is the '1949 Act'.

¶85

Section 9(l)(b )(iii) of that Act provides :

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"(!) Notwithstanding anything contained iti any other law for the time being in force or in any contract if any non-agricultural land has been held for a term of more than one year but less than twelve years-

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(b) without a lease in writing

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¶90

then the tenant holding such non-agricultunit land shall be liable to ejectment on one or more of the followinu 11round> and not otherwise - - namely ;

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(iii) on the ground that the tenancy has been terminated by the landlord by six months' notice in writing expiring with the end of a year of the tenaqcy served on the tenant in the prescribed inanner in the case of tenancies of the class specified in clause (b) ;

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¶93

Provided that a tenant shall not be liable to cjectment on the ground specified in clause (iii) except on payment of such reasonable compensation as may be agreed upon between the landlord and the tenant or if they do not agree, as , may be, determined by the Court on the application of the landlord or such tenant. The only other relevant provision is section 88 of that \ct which says : ·

¶94

·''The provisions of this Act shall have effect ,- • in respect of all suits, appeals or proceedings 111cludtng proceedings in execution for cjectment of a non-agncultural tenant which at:e pending at the date of commencement of this Act. •

¶95

!he contention based on s. 9(l)(b)(iii) was taken fry ii tl.1c hrst t11ne rn the High Court of Calcutta. The H i:oi1 Court as mentioned earlier has accepted that contentil;i1, lf s. 9 reaj withs. 88 of p~e '_19.49 Act' governs this appc.;1 ihen undoubtedly the pla111ti!T s sutl has to fail. But i:1-,.:

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ll~/Ljl S.C.R.

SUPREME COURT REPORTS

¶100

question is "Whether those provisions are not subject to A s. 3 of the '1958 Act'? This question has not been considered by the High Court. The High Court was greatly impressed by the width of s. 88 of the '1949 Act'. Read by itself there is no doubt that that provision makes applicable all the provisions of the '1949 Act' to all suits, appeals B or proceedings including proceedings in execution for ejectment of non-agricultural tenant which was pending at the · time of the commencement of that Act. There is no dispute that the plaintiff has not complied with the requirements of s. 9(l)(b)(iii) of that Act. Therefore if the plaintiff was required to comply with the provisions of the '1949 Act' in c all respects, he having not complied with the same, the suit ought to fail. But then, the provisions of the '1949 Act' did not apply to the 'transferred territories' on their own force. They were extended to those territories under the provisions of the '1958 Act'. Therefore their application is subject to the conditions laid down by the '1958 Act'. D As seen earlier s. 3 of that Act while repealing the laws that were in force in the 'transferred territory and extending the las that were in force in the rest of West Bengal -saved the previous operation of the existing laws so repealed and further saved anything dly done or suffered under those laws. In other words because of cl. (a) of the proviso to E s. 3(2), acts duly done under the repealed laws are protected. Hence the quit notice given under s .. 106-of the Transfer of Property Act by the plaintiff was an act duly done under a repealed law. That act is protected. Its validity cannot be tested on the basis of the provisions of the ~1949 Act'. This is plain from the language of s. 3(2) of the '1958 Act'. F That interpretation also advances public interest. Otherwise all ejectment suits which had been instituted before the transfer of territories had been effected would automatically fail for non-compliance of s. 9 of the '1949 Act', a law which was not in force in the transferred territories before G their transfer. The legislature would not have intended such a result.

¶101

If the plaintiff was not required to comply with requirements of s. 9(1 )(b )(iii) of the '1949 Act' -as we think he was not-then the plaintiff is not liable to pay any compenation for the structures put up by the defendant. The liability to pay reasonable compensation fo the. stru?~.ures put up by the tenant arises under the proviso to cl. (111) of

CHIRANJ! LAL KHAITAN V, MOT! LAL SARAOG! (Hegde, !.) 29

¶106

A s. 9(1)(b)·. That proviso imposed the liability to pay reasonable compenrntion for the structures put up only when the termiration of the tenancy is wade under cl. (iii) of s. 9(l)(b) and not otherwise. As the termi11ation of the tenancy was not made under that provision. the question

¶107

8 of paying compensation does not arise.

¶108

In the result this appeal is allowed. judgment and decree of the Calcutta High Court are set aside and that of the trial court as affirmed by the first appellate court i~ ; restored. Parties to bear their own costs in this Court and in the High Court.

¶109

¶110

G.C.

¶111

Appeal alloll'ed.

Procedural history

How this case reached the court

AI extract

Order under challenge
Judgment and decree dated August 30, 1965 of the Calcutta High Court in Appeal from Appellate Decree No. 1033 of 1956, by which the High Court set aside the decrees of the courts below and dismissed the plaintiff's suit for ejectment for want of six months' notice under s.9(1)(b)(iii) of the West Bengal Non-Agricultural Tenancy Act, 1949.¶25
Calcutta High Court · August 30, 1965
Prior proceeding
The original plaintiff (predecessor-in-interest of the appellants) leased the suit plot, then situate in Bihar, to the defendant by oral lease in June 1943 on a monthly rental of Rs. 20/- for carrying on his motor business.¶30
Prior proceeding
In 1947 the defendant constructed several structures on the land without the plaintiff's knowledge; in 1948 the plaintiff demanded their removal and, on the defendant's failure to comply, served a notice to quit in September 1948 determining the tenancy with effect from November 1, 1948.¶31
Prior proceeding
Suit for ejectment instituted in the court of the Munsif at Purulia; at the time of institution the suit property was within the limits of the State of Bihar.¶36
Prior proceeding
The trial judge decreed the suit in May 1952 as prayed for, directing the defendant to deliver vacant possession of the suit plot after removing the structures put up by him.¶36
Prior proceeding
The first appellate court affirmed the decree of the trial court.¶36
Prior proceeding
The defendant filed a second appeal against the decree in the High Court of Patna on September 7, 1956, which was admitted on September 10, 1956.¶36
Prior proceeding
The area concerned in the litigation stood transferred from Bihar to the State of West Bengal on November 1, 1956.¶36
Prior proceeding
The second appeal stood transferred to the High Court of Calcutta under the Bihar and West Bengal Transfer of Territories Act, 1956.¶36
Prior proceeding
The West Bengal Transferred Territories (Assimilation of Laws) Act, 1958 was enacted and came into force on July 1, 1959.¶36
Prior proceeding
The second appeal came up for hearing before the Calcutta High Court on August 10, 1965.¶36
Prior proceeding
The High Court rejected the plea of equitable estoppel but accepted the defendant's contention under the 1949 Act and dismissed the suit; hence the present appeal by certificate.¶48

Chiranji Lal Khaitan & Ors. v. Moti Lal Saraogi

Case brief

What is this about?

What did the court decide?

Chiranji Lal Khaitan & Ors. v. Moti Lal Saraogi

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

Issues for consideration

Statutes considered

Procedural history

Parties & counsel

Coram

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