judgement:
Appeals Nos.165 168 of 1956.
Appeals from the judgment and order dated March 22, 1955, of the Mysore High Court in Writ Petitions Nos. 20 to 22 and 25 of 1954.
788 H. N. Sanyal, Addl.
Solicitor General of India, R. Ganapathy Iyer and R. H. Dhebar, for the appellant.
A. V. Viswanatha Sastri, K. R. Choudhury and G. Gopalakrishnan, for the respondent.
April 28.
The Judgment of the Court was delivered by S.K. DAS J.
These four appeals brought by the Income tax Officer, Special Circle, Bangalore, on a certificate granted by the High Court of Mysore, are from the judgment and order of the said High Court dated March 22, 1955, by which it quashed certain proceedings initiated, and orders of assessment made, against the respondent assesse in the matter of reassessment of income tax for the years 1945 46, 1946 47, 1947 48, and 1948 1949.
The relevant facts are these.
The respondent K. N. Guruswamy was carrying on business as an excise contractor in the Civil and Military Station of Bangalore, hereinafter called the retroceded area, in Mysore.
He was assessed to income tax for each of the four years mentioned above under the law then in force in the retroceded area by the Income tax Officer having jurisdiction therein.
For 1945 46 the original assessment was made on February 12,1946, for 1946 47 on January 21, 1949, for 1947 48 on January 22, 1949, and for 1918 49 also sometime in the year 1949.
The tax so assessed was duly paid by the assessee.
On January 5, 1954, more than four years after, the Income tax Officer, Special Circle, Bangalore, served a notice on the assessee under section 34 of the Indian Income tax Act, 1922, for the purpose of assessing what was described as escaped ' or 'under assessed ' income chargeable to income tax for the said years.
The assessee appeared through his auditors and contested the jurisdiction of the Income tax Officer to issue the notice or make a re assessment under section 34 of the Indian Income tax Act, 1922.
On February 19, 1954, the Income tax Officer overruled the assessee 's objection, and made a re assessment order for the year 1945 46.
On February 25, 1954, the assessee filed four writ petitions in the Mysore High Court in 789 which he challenged the jurisdiction of the Income tax Officer to take proceedings under section 34 or to make an order of re assessment in such proceedings; he asked, for appropriate orders or writs quashing the pending proceedings for three years and the order of re assessment for 1945 46.
During the pendency of the cases in the High Court, the Income tax Officer was permitted to make an assessment order for 1946 47, subject to the condition that if the assessee succeeded in establishing that the Income tax Officer had no jurisdiction, that order would also be quashed.
The High Court heard all the four petitions together, and by its judgment and order dated March 22, 1955, allowed the writ petitions and quashed the proceedings in assessment as also the two orders of reassessment, holding that the Income tax Officer had no jurisdiction to initiate the proceedings or to make the orders of re assessment.
The High Court, however, granted a certificate that the cases were fit for appeal to this Court, and these four appeals have been brought on that certificate.
Before us, the appeals have been heard together and will be governed by this judgment.
For a clear understanding and appreciation of the issues involved in these appeals, it is necessary to set out, in brief outline, the political and constitutional changes which the retroceded area has from time to time undergone; because those changes had important legal consequences.
Under the Instrument of Transfer executed sometime in 1881, when there was installation of the Maharaja of Mysore by what has been called " the rendition of the State of Mysore ", the Maharaja agreed to grant to the Governor General in Council such land as might be required for the establishment and maintenance of a British cantonment and to renounce all jurisdiction therein.
Pursuant to that agreement, the retroceded area was granted to the Governor General in Council, and jurisdiction therein was exercised by virtue of powers given by the Indian (Foreign Jurisdiction) Order in Council, 1902, made under the Foreign Jurisdiction Act, 1890.
The laws administered in the area included various enactments made applicable thereto from time to 790 time by the promulgation of notifications made under the aforesaid Order in Council, and one of such enactments was the Indian Income tax Act, 1922.
The year 1947 ushered in great political and constitutional changes in India, which affected not merely what was then called British India but also the Indian States, such as Mysore etc.
The Indian Independence Act, 1947, brought into existence two independent Dominions, India and Pakistan, as from August 15, 1947.
The Act, however, received Royal assent on July 18, 1947.
Section 7 set out the consequences of the setting up of the two new Dominions: one such consequence was that the suzerainty of His Majesty over the Indian States lapsed, and with it lapsed all treaties, agreements etc., between His Majesty and the rulers of Indian States, including all powers, rights, authority or jurisdiction exercisable by His Majesty in an Indian State by treaty, grant, usage, suffrage etc.
In view of the aforesaid provision perhaps in anticipation of it, the retroceded area was given back to the State of Mysore on July 26, 1947 by a notification Made by the Crown Representative under the Indian (Foreign Jurisdiction) Order in Council, 1937.
This did not, however, mean that the Mysore laws at once came into force in the retroceded area.
On August 4, 1947, the Maharaja of Mysore enacted two laws: the Retrocession (Application of Laws) Act 1947, being Act XXIII of 1947, and the Retrocession (Transitional Provisions) Act, 1947 being Act XXIV of 1947.
The combined effect of these laws was this: all laws in force in the retroceded area prior to the the date of retrocession, which was July 26, 1947, continued to have effect and be operative in the retroceded area (vide section 3 of Act XXIII of 1947) and the Mysore officers were given jurisdiction to deal with proceedings under the laws in force prior to the date of retrocession (see section 12 of Act XXIV of 1947).
This state of affairs continued till June 30, 1948, on which date was promulgated the Mysore Income tax and Excess Profits Tax (Application to the Retroceded Area) (Emergency) Act, 1948, being Act XXXI of 1948.
Section 3 of this Act said 791 "Notwithstanding anything to the contrary in section 3 of the Retrocession (Application of Laws) Act, 1947, (i) the Mysore Income tax Act, 1923, and (ii) the Mysore Excess Profits Tax Act, 1946, except sub section (4) of section 2, and all rules, orders and notifications made or issued tinder the aforesaid Acts and for the time being in force shall with effect from the first day of July, 1948, and save as otherwise provided in this Act, take effect in the Retroceded Area to the same extent and in the same manner as in the rest of Mysore.
" Section 6 said " Subject to the provisions of this Act, the Indian Income tax Act, 1922, and the Excess Profits Tax Act, 1940, as continued by the Retrocession (Application of Laws) Act, 1947, are hereby repealed.
" The repeal of the Indian Income tax Act, 1922, effected by section 6 aforesaid, was subject to other provisions of Act XXXI of 1948, and one such provision which is material for the dispute before us was contained in section 5, the relevant portion whereof was in these terms " section 5.
Notwithstanding anything to the contrary in the Mysore Income tax Act, 1923, or the Mysore Excess Profits Tax Act, 1946, (a). . . . . . . . . . (b)in respect of the total income or profits chargeable to income tax or excess profits tax in the Retroceded Area prior to the first day of July, 1948, but which has not been, assessed until that date, the provisions of the Indian Income tax Act, 1922,and the Excess Profits Tax Act, 1940, as in force in the Retroceded Area immediately before that date shall apply to proceedings relating to the assessment of such in come or profits until the stage of assessment, and the determination of the income tax and excess profits tax payable thereon, and the Mysore Income tax Act, 1923, or the Mysore Excess Profits Tax Act, 1946, as the case may be, shall apply to such proceedings after that stage ; 101 792 (c). . . (d). . . (e). . .
The effect of sections 3, 5 (b) and 6 of Mysore Act, XXXI of 1948, inter alia, was that though the Indian Incometax Act, 1922, stood repealed and the Mysore Incometax Act, 1923, came into effect from July 1, 1948 the former Act as in force in the retroceded area prior to July 1, 1948, continued to apply in respect of the total income chargeable to income tax in the retroceded area prior to July 1, 1948 but which had not been assessed until that date, and it further applied to all proceedings relating to the assessment of such income until the stage of assessment and the determination of incometax but the Mysore Act, 1923, applied to such proceedings after that stage.
On August 5, 1948, was promulgated the Retroceded Area (Application of Laws) Act, LVII of 1948, which came into effect from August 15, 1948.
Sections 3 and 4 of Act LVII of 1948, are material for our purpose and may be quoted "section 3.
Except as hereinafter in this Act provided, (3) all laws in force in Mysore shall apply to the Retroceded Area; and (b)the laws in force in the Retroceded Area immediately before the appointed day shall not, from that day, have effect or be operative in the Retroceded Area,." " section 4.
The enactments in force in Mysore which are set out in the first column of Schedule A to this Act shall apply to the Retroceded Area subject to the modifications and restrictions specified in the second column of the said Schedule and, the provisions of this Act.
" Schedule A, paragraph (2), sub paragraph (b) repeated ' in substance what was stated earlier in section 5 (b).
of Act XXXI of 1948.
It read " 2.
Notwithstanding anything to the contrary in the Mysore.
Income tax Act, 1923, or the Mysore Excess Profits Tax Act, 1946 (a). . . . 793 (b) in respect of the total income or profits chargeable to income tax or excess profits tax in the Retroceded Area prior to the first day of July 1948, but which has not been assessed until that date, the provisions of the Indian Income tax Act, 1922, and the Excess Profits Tax Act, 1940, as in force in the Retroceded Area immediately before that, date shall apply to proceedings relating to the assessment of such income or profits until the stage of assessment, and the determination of the income tax and excess profits tax payable thereon, and the Mysore Incometax Act, 1923, or the Mysore Excess Profits Tax Act, 1946, as the case may be, shall apply to such proceedings after that stage; " There were further far reaching political and constitutional changes in 1949 50.
The Maharaja of Mysore had acceded to the Dominion of India in 1947; this, however, did not empower the Dominion legislature to impose any tax or duty in the State of Mysore or any part thereof.
By a proclamation dated November 25, 1949, the Maharaja of Mysore accepted the Constitution of India, as from the date of its commencement, as the Constitution of Mysore, which superseded and abrogated all other constitutional provisions inconsistent therewith and in force in the State.
On January 26, 1950, the Constitution of India came into force, and Mysore became a Part B State within the Constitution of India.
On February 28, 1950, there was a financial agreement between the Rajpramukh of Mysore and the President of India in respect of certain matters governed by articles 278, 291, 295 and 306 of the Constitution.
Under article 277 of the Constitution, however, all taxes which immediately before the commencement of the Constitution were being levied by the State continued to be so levied, notwithstanding that those taxes were mentioned in the Union List, until provision to the contrary was made by Parliament by law.
Such law was made by the Finance Act, 1950, by which the whole of Mysore including the retroceded area became " taxable territory " within the meaning of the Indian Income tax Act, 1922, from April 1, 1950, and the 794 Indian Income tax Act again came into force in the retroceded area from the aforesaid date.
Section 13 of the Finance Act, 1950, dealt with repeals and savings.
As the true scope and effect of sub section
(1) of section 13 is one of the questions at issue before us, it is necessary to read it.
" If immediately before the 1st day of April, 1950, there is in force in any Part B State other than Jammu and Kashmir or in Manipur, Tripura or Vindhya Pradesh or in the merged territory of CoochBehar any law relating to income tax or super tax or tax on profits of business that law shall cease to have effect except for the purposes of the levy, assess ment and collection of income tax and super tax in respect of any period not included in the previous year for the purposes of assessment under the Indian Income tax Act, 1922, for the year ending on the 31st day of March, 1951, or for any subsequent year, or, as the case may be, the levy, assessment and collection of the tax on profits of business for any chargeable accounting period ending on or before the 31st day of March, 1949: Provided that any reference in any such law to an officer, authority, tribunal or court shall be construed as a reference to the corresponding officer, authority, tribunal or court appointed or constituted under the said Act, and if any question arises as to who such corresponding officer, authority, tribunal or court is, the decision of the Central Government thereon shall be final.," Now, the legal effect of the constitutional changes referred to above, so far as it has a bearing on the present dispute, may be briefly summarised as follows: the Indian Income tax Act, 1922, remained in force in the retroceded area till June 30, 1948 ; from July 1, 1948, the Mysore Income tax Act, 1923, applied, subject to this saving that the Indian Income tax Act continued to apply in respect of the total income chargeable to income tax in the retroceded area prior to July 1, 1948, and the provisions of that Act as in force in the retroceded area prior to that date applied to all proceedings relating to the assessment of such income 795 upto the stage of assessment and determination of income tax payable thereon.
This position continued till April 1, 1950, when the Finance Act, 1950, came into force and the Indian Income tax Act, 1922, again came into force in the retroceded area, subject to the saving mentioned in section 13(1) thereof.
The principal question before us, as it was before the High Court, is one of jurisdiction.
Did the Income tax Officer concerned have jurisdiction to issue the notice under section 34 of the Indian Income tax Act, 192 and to make a re assessment order pursuant to sue notice ? The High Court pointed out that though the notice did not clearly say so, the Income tax Officer clearly acted under section 34 of the Indian Income tax Act, 1922, as it was in force in the retroceded area prior to July 1, 1948, and the writ applications were decided on that footing.
The four main lines of argument on which the respondent assessee rested his contention that the Incometax Officer concerned had no jurisdiction were these : firstly, it was urged that section 34 of the Indian Incomtax Act, 1922, was not saved by section 13(1) of the Finance Act, 1950, because what was saved was the prior law " for the purposes of the levy, assessment and collection of income tax ", which expression did not include re assessment proceedings; secondly, it was argueed that, even otherwise, the financial agreement made between the President of India and the Rajpramukh of Mysore on February 28, 1950, which received constitutional sanctity in article 278 of the Constitution rendered the impugned proceedings unconstitutional and void; thirdly, it was submitted that the Indian Income tax Act, 1922, as in force in the retroceded area stood repealed on June 30, 1948, by Mysore Act XXXI of 1948, and the saving provisions in section 5(b) thereof or in paragraph (2), sub paragraph (b), of Schedule A to Mysore Act LVII of 1948, did not save section 34 in so far as it permitted re assessment proceedings in respect of years in which there had been an assessment already; and lastly, it was contended that after June 30, 1948, and until April 1, 1950, the Income tax Officer in the retroceded area could re open 796 the assessment under section 34 of the Mysore Incometax Act, 1923, within a period of four years specified therein, but there was no authority to re open the assessment under section 34 of the Indian Income tax Act.
Following its own decision, City Tobacco Mart and Others vs Income tax Officer, Urban Circle, Bangalore (1), on certain earlier writ petitions (nos. 52 and 53 of 1953 and 105 and 106 of 1954), the High Court held in favour of the assessee on the construction of section 13 (1) of the Finance Act, 1950 and also oil the effect of the saving provisions in section 5 (b) of Mysore Act XXXI of 1948, and paragraph (2), sub paragraph (b) of Schedule A to Mysore Act LVII of 1948.
On these findings, it held that the Income tax Officer concerned had no jurisdiction or authority to start the impugned pro ceedings or to make the impugned orders of assessment.
It did not feel called upon to pronounce on the validity of the argument founded on the financial agreement dated February 28, 1950.
In Civil Appeals 143 145 of 1954, Civil Appeals 27 to 30 of 1956 and Civil Appeals 161 to 164 of 1956, Lakshmana Shenoy vs The Income tax Officer, Ernakulam (2), in which judgment has been delivered today, we have fully considered the arguments as to the true scope and effect of section 13(1) of the Finance Act, 1950, and of the financial agreement of February 28, 1950, taken along with the recommendations of the Indian States Finances, Enquiry Committee.
We have held therein that the expression I levy, assessment and collection of income tax in section 13 (1) is wide enough to comprehend re assessment proceedings under section 34 and that the financial agreement aforesaid, on a true construction of the recommendations of the Enquiry Committee, does not render the impugned proceedings Unconstitutional and void.
That decision disposes of these two arguments in the present appeals.
The two additional points which remain for consideration depend on the interpretation to be put on the saving provisions in section 5(b) of Mysore Act XXXI of 1948 and paragraph (2), sub paragraph (b) of Schedule (1) A.I.R. 1955 MYS.
(2) [1959] S.C.R. 751.
797 A to Mysore Act LVII of 1948.
These provisions are expressed in identical terms, and the question is if they save section 34 of the Indian Income tax Act with regard to re assessment proceedings.
We think that they do.
It is worthy of note that the saving provisions say that the Indian Income tax Act, 1922, as in force in the retroceded area prior to July 1, 1948, shall apply in respect of the total income chargeable to income tax prior to that date and it shall apply to proceedings relating to the assessment of Such income, until the stage of assessment and determination of income tax payable thereon. 'Total income ' means the total amount of income, profits and gains computed in the manner laid down in the Act, and there are no good reasons why the word 'assessment ' occurring in the saving provisions should be restricted in the manner suggested so as to exclude proceedings for assessment of escaped income or under assessed income.
On behalf of the assessee our attention has been drawn to the words "in respect of the total income chargeable to income tax. . but which has not been assessed until that date " occurring in the saving provisions and the argument is that, those words show that there was no intention to permit reopening of assessments which had been made already.
We are unable to accept this argument.
In its normal sense, I to assess ' means 'to fix the amount of tax or to determine such amount '.
The process of re assessment is to the same purpose and is included in the connotation of the term " assessment ".
The reasons which led us to give a comprehensive meaning to the word " assessment " in section 13 (1) of the Finance Act, 1950, operate equally with regard to the saving provisions under present consideration.
We agree with the view expressed in Hirjibhai Tribhuvandas vs Income tax Officer, Rajnandgaon and another (1), that section 34 of the Income _tax Act contemplates different cases in which the power to assess escaped income has been given; where there has been no assessment at all, the, term " assessment " may be appropriate and where there was assessment at too low a rate or with (1) A.I.R. 1957 M.P. 171.
798 unjustified exemptions, the term re assessment ' may be appropriate, and it may have been necessary to use two different terms to cover with clarity the different cases dealt with in the section ; but this does not mean that the two terms should be treated as mutually exclusive or that the word 'assessment ' in the saving provisions should be given a restricted meaning.
The object of the saving provisions was obviously to make the prior law available in all cases in which the income was assessed or was assessable according to that law before July 1, 1948, and it is difficult to see why only a part of the process of assessment should be saved and the other part repealed.
We, therefore, hold that the saving provisions save section 34 of the Indian Income tax Act, 1922, in its entirety, as it was in force in the retroceded area prior to July 1, 1948, and the contention of the respondent that it stood repealed from that date is not correct.
As to the period of limitation, it would be the period laid down in section 34 of the Indian Income tax Act as it was in force in the retroceded area prior to July 1, 1948.
The result, therefore, is that these appeals succeed and the judgment and order of the High Court of Mysore dated March 22, 1955, are set aside and the writ petitions filed by the respondent assessee are dismissed.
The appellant will get his costs in this Court and the High Court.
Appeals allowed.

summary/full:
The respondent was carrying on business as an excise con tractor in the Civil and Military Station of Bangalore in the State of Mysore, called the retroceded area.
The jurisdiction ' over this area was originally exercised by the Governor General in Council by virtue of an agreement with the Maharaja of Mysore, and the income tax law applicable was the Indian Income tax Act, 1922.
On July 26, 1947, the retroceded area was given back to the State of Mysore but the income tax law in force in that area prior to that date continued to have effect and be operative till June 30, 1948, on which date was promulgated the Mysore Income tax Act and Excess Profits Tax (Application to the Retroceded Area) (Emergency) Act, 1948, the effect of which was that the Indian Income tax Act, 1922, stood repealed and the Mysore Income tax Act, 1923, came into force subject to certain saving provisions.
On August 5, 1948, was promulgated the Retroceded Area (Application of Laws) Act, 1948.
Between 1947 and 1950 there were political and constitutional changes which ultimately resulted in Mysore becoming a Part B State within the Constitution of India.
The legal effect of these changes was that the income tax law applicable to the retroceded area till June 30, 1948, was the Indian Income tax Act, 1922 ; from July 1, 1948, the Mysore Income tax Act, 1923, became applicable except that the Indian Income tax Act continued to apply in respect of the total income chargeable to income tax in the retroceded area prior to July 1, 1948, and the provisions of that Act as in force in the retroceded area prior to that date applied to all proceedings relating to the assessment of such income upto the stage of assessment and determination of income tax payable thereon.
This position continued till April 1, 1950, when the Finance Act, 1950, came into force and as a result the Indian Income tax Act, 1922, became applicable again to the retroceded area, subject to the saving provisions of section 13(1) of the former Act.
In respect of the assessment for the four years between 1945 and 1949, the respondent was assessed to income tax under the law then in force in that area; subsequently, in 1954 the Income tax Officer served a notice on the respondent under section 34 of the Indian Income tax Act, 1922, for the purpose of assessing " escaped " or " under assessed " income chargeable to income tax for the said years.
The respondent challenged the jurisdiction of the Income tax Officer to take proceedings under section 34 or to make an order of re assessment on the grounds inter alia (1) that section 34 Of the Indian Income tax Act, 1922, was not saved by section 13(1) of the Finance Act, 1950, because what was saved was the prior law " for the purposes of the levy, assessment and collection of income tax ", which expression did not include re assessment proceedings, (2) that the 787 financial agreement made between the President of India and the Rajpramukh of Mysore dated February 28, 1950, rendered the impugned proceedings unconstitutional and void, (3) that the Indian Income tax Act, 1922, as in force in the retroceded area stood repealed on June 30, 1948, by the Mysore Income tax and Excess Profits (Application to the Retroceded Area) (Emergency) Act, 1948, and the saving provisions in section 5(b) thereof or in para (2), sub para (b) of Sch.
A to the Retroceded Area (Application of Laws) Act, 1948, did not save section 34 in so far as it permitted re assessment proceedings in respect of years in which there had been an assessment already, and (4) that after June 30, 1948, and until April 1, 1950, the Income tax Officer in the retroceded area could re open the assessment under section 34 Of the Mysore Income tax Act, 1923, within a period of four years specified therein, but there was no authority to re open the assessment under section 34 Of the Indian Income tax Act.
Held : (1) that the expression " levy, assessment and collection of income tax " in section 13(1) Of the Finance Act, 1950, was wide enough to comprehend re assessment proceedings under section 34 Of the Indian Income tax Act, 1922, and that the financial agreement between the President of India and the Rajpramukh of Mysore, on a true construction of the recommendations of the Indian States Finance Enquiry Committee, did not render the impugned proceedings unconstitutional or void ; Lakshmana Shenoy vs The Incomc tax Officer, Ernakulam, [1959] S.C.R. 751, followed.
(2) that the saving provisions in the Mysore Income tax and Excess Profits (Application to the Retroceded Area) (Emergency) Act, 1948, and the Retroceded Area (Application of Laws) Act, 1948, made the prior law available in all cases in which the income was assessed or was assessable according to that law before July 1, 1948, and, therefore, they saved section 34 of the Indian Income tax Act, 1922, with regard to re assessment proceedings ; City Tobacco Mart and Others vs Income tax Officer, Urban Circle, Bangalore, A.I.R. 1955 Mys.
49, overruled.
Hirjibhai Tribhuwandas vs Income tax Officer, Rajnandgaon and another, A.I.R. 1957 M. P. 171, approved.
(3) that the Income tax Officer had the authority to re open the assessments in the present case because the period of limitation was that laid down in section 34 of the Indian Income tax Act, as it was in force in the retroceded area prior to July 1, 1948.


judgement:
ivil Appeal Nos. 123124 of 1985.
From the Judgment and Order dated 21.9.1984 of the Punjab and Haryana High Court in R.S.A. No. 1716 of 1978 and R.S.A. No. 1898 of 1978.
Shanti Bhushan, Vishnu Mathur, Mrs. Roxna Swamy and Rajinder Singh for the Appellants.
T.A. Ramachandran and Ramesh K. Keshwani for the Re spondents.
The Judgment of the Court was delivered by OZA, J.
These appeals arise out of the judgment of Punjab & Haryana High Court dated 21.9.1984 in Regular Second Appeal Nos.
1716/78 and 1698/78 wherein the learned Judge dismissed the two second appeals and maintained the judgment of the appellate court i.e. Additional District Judge granting a decree for half share of the property each in favour of Smt.
Pan Bai and Smt.
Sohan Bai, the two daugh ters of deceased Smt.
Mam Kaur.
In order to clearly understand the facts the pedigree of the family would be relevant: 1015 Hari Singh Sanehi Singh Hazari Singh Smt.
Mam Kaur Jawana Singh Lakhi Singh Smt.
Pan Bai Smt.
Sohan Bai Munshi ' (Plaintiff in (Plaintiff in Singh & Ranjit Singh suit out of suit out of five others and6 other sons which RSA No. which RSA No.(defendants (Defendants 7 1698 of 1978 17 16 of 1978 Nos.1to 6) to 13) has arisen) has arisen) Hazari Singh owned agricultural lands the dimensions and its identity is not in dispute before us and he died in November 1918 leaving behind his widow Smt.
Mam Kaur who inherited the property.
Hazari Singh had left behind two daughters i.e. Smt.
Pan Bai, Plaintiff in the suit out of which second appeal before the High Court was No. 1698/78 and Smt.
Sohan Bai who was also a plaintiff in suit out of which second appeal before the High Court was No. 17 16/78.
In 1944 it is alleged that Smt.
Mam Kaur adopted Ranjit Singh grandson of Sanehi Singh and son of Lakhi Singh.
This Ranjit Singh had six other brothers and it is alleged that in 1945 Smt.
Mam Kaur gifted all the lands which she had inherited from her husband by an oral gift to Ranjit Singh.
As regards the two events i.e. adoption and gift there is some controversy in respect of the respective dates.
It appears and it was contended by the counsel for the appel lants that adoption was first and gift was only a consequen tial act to accelerate the succession whereas learned coun sel for the respondents contended that gift was first where as adoption was subsequent.
But it is not disputed that the gift also is nothing more than an oral gift and the same is about adoption.
Munshi Singh and his five brothers filed a suit for declaration challenging this gift and adoption made by Smt.
Mam Kaur in favour of Ranjit Singh.
By judgment and decree dated 24. 7.1947 the suit was decreed and it was held that the adoption of Ranjit Singh was invalid and the gift also was held ,to be invalid and a declaration was granted in respect of the gift so far as it affected the reversionary rights.
Against this judgment Ranjit Singh preferred an appeal but this was also dismissed.
On 4th June, 1963 Smt.
Mam Kaur sold away the entire lands to Ranjit Singh and his brothers for an amount of Rs.50,000.
Thereafter 1016 to claim pre emption a suit was filed by Smt.
Pan Bai and the other suit was filed by Munshi Singh and his five broth ers on the ground that as reversioners they have a superior right to pre emption.
In these preemption matters ultimately the Court held that Smt.
Pan Bai had a superior right as compared to Munshi Singh and his brothers and therefore and earlier date was given to Smt.
Pan Bai to deposit the sale amount and seek pre emption failing which her suit was to be dismissed and a later date was given to Munshi Singh and his brothers to deposit the sale amount and opt for pre emption.
Similar condition of dismissal of the suit for failure of depositing the amount was imposed.
So far as Smt.
Pan Bai is concerned she did not deposit the amount and therefore her suit for pre emption was dismissed where as Munshi Singh and others deposited the amount and obtained a decree of preemp tion which was executed and they obtained possession and in this manner they stood substituted in the sale.
In January 1965 Smt.
Mam Kaur died and Smt.
Sohan Bai filed a suit bearing No. 403/65 seeking a decree for posses sion of half of the share on the plea that in view of the declaratory decree dated 24.7.
1947 which was confirmed on appeal that on the death of Smt.
Mam Kaur succession had to be traced to Hazari Singh i.e. Sohan Bai 's father and she being the direct heir of Hazari Singh was entitled to half share in the land.
It was also pleaded that Smt.
Mam Kaur had already parted with her widow 's estate by gift deed made by her in 1945 in favour of Ranjit Singh and therefore she had no subsisting title which she could transfer by way of sale by the sale deed dated 4.9.63 and thus by this sale deed as she herself had no title she could not convey any title in favour of Ranjit Singh and his brothers.
Sohan Bai 's suit was decreed but on appeal it was remanded.
In the mean time Smt.
Pan Bai also filed a similar suit which was numbered 203/68 to claim possession of the remaining half share on the same ground, as was filed by Smt.
Sohan Bai.
The two suits were consolidated and the trial court by its judgment dated 2nd January, 1973 decreed Smt.
Sohan Bai 's suit but dismissed the suit filed by Smt.
Pan Bai on the ground that as Smt.
Pan Bai had filed a suit claiming on the basis of pre emption earlier she was estopped from disputing the validity of sale made by Smt.
Mam Kaur.
Against this judgment of the trial court losing parties filed their appeals before the Additional District Judge who by his judgment and decree dated 25.9.78 maintained the decree in the suit of Sohan Bai and reversed the trial court judgment in the suit of Smt.
Pan Bai and held that both the daughters were entitled to succeed to half share each in the property.
Against this judgment the defendants in Smt.
Sohan Bai 's case filed a regular second appeal which was No. 1716/78 1017 and defendants in Smt.
Pan Bai 's case filed regular second appeal which was No. 1698/78 in the Punjab & Haryana High Court.
Both these second appeals Were disposed of by the impugned judgment of the High Court.
Most of the facts are not in dispute.
The main contro versy raised in these appeals is that in the earlier suit the adoption and gift both were declared as invalid in a suit for declaration filed by the reversioners, what will be its effect? On the one hand counsel for the appellants contended that in fact adoption was followed by gift more or less in the nature of a step to accelerate the succession and when the court declared both to be invalid it clearly meant that the donee who was the adopted son Ranjit Singh was not left with any rights in the properties whereas on behalf of the respondents it was contended that adoption no doubt was declared invalid but so far as gift was concerned it was declared invalid in a suit for declaration by rever sioners to the limited extent that this gift will not affect the rights of the reversioners thereby meaning that so far as the life estate of Smt.
Mam Kaur was concerned it was transferred by this gift deed but the right of the rever sioners to succeed on the death of Smt.
Mam Kaur was pro tected as it was declared that this gift will not affect the rights of the reversioners.
A controversy was also raised as to which adoption or gift was first in time and what is its effect? Learned counsel for the appellants contended that as the adoption and gift both were declared invalid although a declaration was granted in a suit by reversioners but it clearly meant that nothing remained with the so called donee and therefore when Hindu Succession Act come into force because of Section 14 clause (1) Smt.
Mam Kaur became the absolute owner and therefore she had a valid right to trans fer the property by sale.
It was also contended that Ranjit Singh in whose favour the gift was alleged to have been made himself agreed to purchase this property alongwith his brothers; this indicates that he accepted the position that Smt.
Mam Kaur after coming into force of the Hindu Succes sion Act had acquired the absolute rights and she could convey the property by sale.
In any event his accepting to purchase the property from Smt.
Mam Kaur, amounts to an admission that there was no right created in his favour by gift which was declared invalid and on this basis learned counsel for the appellants contended that the appellants are entitled to succeed and the High Court was not right in granting the decree on the basis of the claim of the two daughters who claimed to be the heirs of Hazari Singh.
Alternatively it was 1018 also contended by learned counsel for the appellants that even if the gift in favour of Ranjit Singh is accepted it is clear that Smt.
Mam Kaur had succeeded to the property as an heir of her husband and because of Hindu women 's right to property Act, 1937 Smt.
Mam Kaur had a limited estate.
As it is well settled that this limited estate in favour of Smt.
Mam Kaur had all the rights which an heir could have in immovable property but in the case of female heirs the only limitation was in respect of alienation and alienation could only be of the rights that she could alienate and that amounts to only life interest.
It is also well settled that the alienaee in this case Ranjit Singh will get the property till the life time of Smt.
Mam Kaur and it is also well settled that if during the life time of Smt.
Mam Kaur Hindu Succession Act came into force, as the property in suit was in the hands of alienee i.e. Ranjit Singh he will not get the benefit of Section 14(1) and will not become the abso lute owner but on the death of Smt.
Mam Kaur the property will revert back to the heirs of Smt.
Mam Kaur 's husband.
It was also contended that in spite of the fact that a gift creating a life interest in favour of Ranjit Singh was in existence but Smt.
Mam Kaur still had the residuary rights of disposing of the property after her death if during her lifetime the Hindu Succession Act came into force.
As in the present case it did come into force, the limited rights which remained with Smt.
Mam Kaur became full rights on coming into force of the Hindu Succession Act and therefore if Smt.
Mam Kaur transferred by sale the property the sale would convey at least the residuary rights vested in her i.e. the right of absolute ownership at most subject to possession of the alienee during her lifetime and on this basis it was contended that the sale made by Smt.
Mam Kaur is valid and therefore the view taken by the High Court is not correct.
On the other hand learned counsel for the respondents contended that as the gift was valid the property was trans ferred in favour of the alienee i.e. Ranjit Singh although it was the life estate but with the Hindu Succession Act coming into force she could not be said to be possessed of the property as there were no rights in the property vested in Smt.
Mam Kaur and even if the widest meaning is given to 'possessed of ' still it could not be contended that she had any rights left with her.
Therefore during her lifetime the alienee alone had the rights in property.
The effect if any of the earlier decree was that on her death the property will revert back and in that event it will revert back to the heirs of her husband not to her heirs and in this view it was contended that the judgment passed by the High Court is correct.
As regards the effect of Smt.
Pan Bai 's suit for pre emption 1019 leading to estoppel also contentions were advanced.
Learned counsel for the appellants on the basis of decisions of this Court in Jagannathan Pillai vs Kunjithapa dam Pillai and Ors., ; and Gopal Singh and Another vs Dile Ram (dead) by LRs and others, contended that as the gift at best could be said to be effective during the lifetime of Smt.
Mam Kaur she had a residuary right left in her which she could dispose of.
Alternatively it was contended that gift in favour of Ranjit Singh was declared invalid and therefore she could be said to be possessed of the property in view of language of Section 14(1) of the Hindu Succession Act.
It was also contended that in the sale deed, Ranjit Singh himself was one of the purchasers and the sale deed indicates that at the time of sale Smt.
Mam Kaur delivered possession to the purchasers.
On these basis it was contended that it appears that Ranjit Singh had given the possession of the property back to Smt.
Mam Kaur before this sale deed was executed.
Learned counsel for the respondents on the other hand contended that the decree declaring the gift bad was only a declaratory decree in favour of the reversioners that clear ly meant that so far as reversioners rights on the death of Smt.
Mam Kaur are concerned they could not be affected by gift but it did not mean that Smt.
Mam Kaur did not transfer her rights by gift in favour of Ranjit Singh.
It was there fore contended that in view of decision in Kuldip Singh and others vs Surain Singh and Others, which is a judgment of a Bench .of three Judges of this Court, Smt.
Mam Kaur could not be said to be a person possessed of anything and therefore no benefit could be obtained by Section 14(1) so far as Smt.
Mam Kaur is concerned and it was therefore contended that the judgment passed by the High Court could not be assailed.
It was also contended that so far as the question of re conveyance by Ranjit Singh in favour of Smt.
Mam Kaur is concerned, the question has been examined on the basis of evidence by the two courts below and a positive finding has been arrived at by the courts that the evidence is not sufficient to come to the conclu sion that there was transfer of possession from Ranjit Singh to Smt.
Mam Kaur before the sale deed was executed.
It was also contended that the two decisions on which reliance is placed by the learned counsel are clearly distinguishable on facts as in these two judgments on the date the Hindu Suc cession Act came into force, the widow was possessed of the property and therefore it was held that she acquired the rights as full owner.
1020 So far as the contention of the learned counsel for the appellant about the transfer of possession from Ranjit Singh back to Smt.
Mam Kaur is concerned the learned courts below have come to a positive finding of fact that there was no transfer of possession in favour of Smt.
Mam Kaur before the sale deed by her was executed and while coming to the con clusion the courts below have considered the effect of the recital in the sale deed executed by Smt.
Mam Kaur and the fact that Ranjit Singh is one of the purchasers and having gone through the judgments, in our opinion, the conclusions could not be said to be erroneous and therefore the conten tions of the learned counsel for the appellants on that ground could not be accepted.
As regards the question about the declaration of the gift to be invalid, the judgment which granted the decree in favour of the reversioners clearly indicated that it was a decree of declaration saying that the gift had no effect on the rights of the reversioners.
The words in the operative part of the judgment stated: "For the reasons aforesaid the plaintiffs succeed and are granted a decree for declara tion that Mst.
Mam Kaur did not validly adopt Ranjit defdt.
and that gift in favour of Ranjit defdt.
shall not affect the right of the reversioners after the death or termina tion of the interest in the suit land of Mst.
Mam Kaur.
" In this view of the matter it is therefore clear that what was held was that the gift will not affect the rights of the reversioners on the death of Smt.
Mam Kaur but it could not be disputed that so far as Smt.
Mam Kaur during her lifetime is concerned as she had gifted away the property to Ranjit Singh and delivered possession she had no rights left with her.
The contentions advanced by learned counsel in respect of residuary rights also is of no consequence as it is apparent that Smt.
Mam Kaur who was enjoying the limited estate before the Hindu Succession Act came into force, transferred her rights by gift and if a valid gift is ef fected it could not be contended that there were any residu ary rights left with her.
In fact what residuary rights could be thought of were not the rights of the widow but the right of the reversioners to get as heirs of her husband on her death and on that basis it could not be said that she could be said to be possessed of any right in the property which she held as a limited owner on the date the Hindu Succession Act came into force.
In Jagannathan Pillai 's case the 1021 property was re conveyed in favour of the widow and this Court therefore observed: "The case of the widow who had temporarily lost the right in the property by virtue of the transfer in favour of the alienee or the donee cannot be equated with that of a strang er by forgetting the realities of the situa tion.
Surely, the Act was intended to benefit her.
And when the widow becomes possessed of the property, having regained precisely that interest which she had temporarily lost during the duration of the eclipse, Section 14(1) would come to her rescue which would not be the matter in the case of a stranger who cannot invoke Section 14( 1).
" In Gopal Singh 's case, this Court while examining the facts, clearly stated as under: "It is pertinent to note that the compromise decree reads as follows: I allow the appeal of the appellants and modify the judgment of the trial court to the extent that gift deed in respect of the land measuring 21 15 17 bighas comprising Khata Khatauni No. 3/16 to 27 bighas situated in village Barsu Ballah is hereby rejected and declared ineffective.
The aforesaid land along with the other land shall be divided in equal shares after the death of Sheru alias Bhushe hari and Dhari shall himself give due share to Hari Ram in accordance with the aforementioned order.
" The operative portion of the compromise decree which was quoted by this Court in the judgment clearly indicated that as the gift deed was ineffective in respect of the lands mentioned therein the widow continued to enjoy the rights and benefits till the Hindu Succession Act came in force as it is observed: "The effect of the aforesaid was that the gift was ineffective and Smt.
Bhushehari continued to enjoy the right and benefit she had during her limited ownership until 1956".
Under these circumstances therefore these cases do not help the appellant.
It is clear that in view of gift made in favour of Ranjit Singh,Mam Kaur on the date on which Hindu Succession Act came into 1022 force, was not possessed of any fight in the property and therefore she could not get any advantage from the coming into force of the Hindu Succession Act.
This Court in Kuldip Singh 's case clearly held: "It is clear from the questions reproduced above that, on the principles laid down by this Court in the case of Mangal Singh and others (supra) it has to be held in the present case that the property in dispute cannot be held to be possessed by Smt.
Mehtab Kaur, because, after gifting the property to Hamam Singh, and parting with the possession of the property, she was not left with any fights at all under which she could regain possession in her own life time.
The gift executed by her was binding on her, even though it may not 'have been binding on the reversioners.
She could not, therefore, avoid the deed of gift and could not claim back possession from Hamam Singh or his successors in interest.
Having thus completely parted with her fights, she could not be held to be possessed of the property when the Act came into force and consequently she could not become full owner of it.
" It is clear that on the date on which Smt.
Main Kaur executed the sale deed, in fact she had no title to the property nor she was in possession thereof.
As regards the contention about Smt.
Pan Bai on the basis of estoppel is concerned it is clear from the language of Section 115 of the Evidence Act that doctrine of estoppel can not be invoked merely because Smt.
Pan Bai filed a suit for pre emption.
Section 115 of the Evidence Act reads thus: "When one person has, by his declaration, act or omission, intentionally caused or permitted another person to believe a thing to be true and to act upon such belief, neither he nor his representative shall be allowed, in any suit or proceeding between himself and such person or his representative, to deny the truth of that thing.
" In view of this learned counsel did not seriously press the contention.
Consequently we see no reason to entertain the appeal.
The appeals are therefore dismissed and the decree passed by the learned courts below is maintained.
In view of the circumstances of the case we pass no orders as to costs.

dataset_name: IN-Abs

summary/full:
One Hazari Singh died in November 1918 leaving behind his widow Smt.
Mam Kaur and two daughters viz., Smt.
Pan Bai and Smt.
Sohan Bai.
The widow inherited the agriculture properties of her husband.
The present appeals have arisen out of the two suits filed by the two daughters aforesaid claiming their half share in the property.
The circumstances that led to the filing of the suits may be stated thus: Smt.
Mam Kaur, the widow, adopted Ranjit Singh grand son of Sanehi Singh and son of Lakhi Singh (one of the collater als) in 1944 and gifted all the lands to him inherited by her from her husband.
Both the adoption as also the gift were made orally.
Munshi Singh and his brothers (reversions) filed a suit challenging the validity both of the adoption of Ranjit Singh and the gift of the properties to him.
By a decree of the Court both the adoption as also the gift in favour of Ranjit Singh were declared invalid and a declaration was granted in respect of the gift so far as it affected the reversionary rights.
Thereupon on 4th June, 1963, Smt.
Mam Kaur sold away the entire property to Ranjit Singh & his brothers for Rs.50,000.
Pan Bai, daughter of deceased Hazari Singh and Munshi Singh and others (revisioners) filed suits claiming pre emption rights to purchase the properties in question.
By a decree of the Court it was held that Pan Bai has a superior right to purchase the property.
Accordingly first preference was granted in favour of Smt.
Pan Bai to deposit the sale amount and seek pre emption failing which her suit was to be dismissed and a later date was given to Munshi Singh and others.
Pan Bai did not deposit the amount with the result Munshi Singh & others deposited the amount and took possession of the properties and came to be substi tuted in the sale.
1013 On the death of Mam Kaur in January, 1965, Smt.
Sohan Bai (her 2nd daughter) filed a suit for a decree for posses sion of half of the share on the plea that in view of the declaratory decree of 24.7.47, on the death of Smt.
Mam Kaur, succession had to be traced to Hazari Singh i.e. her father.
Pan Bai, also filed a suit for the same relief.
The Trial Court decreed the suit filed by Smt.
Sohan Bai but dismissed the suit filed by Smt.
Pan Bai on the ground that as Smt.
Pan Bai had flied a suit claiming on the basis of pre emption earlier, she was estopped from disputing the validity of the sale made by Smt.
Mam Kaur.
On appeal the Additional District Judge maintained the decree passed in the suit of Smt.
Sohan Bai and reversed the trial Court 's Judgment in the suit filed by Smt.
Pan Bai and held that both the daughters were entitled to succeed to half share each in the property.
Against the order of the Additional District Judge, defendants in both the suits filed Regular Second Appeals in the High Court which were dismissed by the impugned judgment.
Hence these appeals.
Before this Court it was inter alia contended by the appellants that ; in an earlier suit the adoption and the gift having been declared invalid, the donee who was the adopted son of Ranjit Singh was not left with any rights in the properties; on the other hand it was contended by the Respondents that no doubt adoption was declared invalid but so far as gift was concerned, it was declared invalid in a suit for declaration by reversioners to the limited extent that this gift will not affect the rights of the reversion ers thereby meaning that so far as the life estate of Smt.
Mam Kaur was concerned, it was transferred by the gift deed but the right of the reversioners to succeed on the death of Smt.
Mam Kaur was protected as it was declared that this gift will not affect the rights of the reversioners.
Dismissing the appeals, this Court, HELD: The gift will not affect the rights of the rever sioners on the death of Smt.
Mam Kaur but it could not be disputed that so far as Smt.
Mam Kaur during her life time is concerned, as she had gifted away the property to Ranjit Singh and delivered possession, she had no rights left with her.
[1020E F] What residuary rights could be thought of were not the rights of the widow but the right of the reversioners to get as heirs of her husband on her death and on that basis it could not be said that she could be said to be possessed of any right in the property which she held 1014 as a limited owner on the date the Hindu Succession Act came into force.
[1020G H] On the date on which Smt.
Mam Kaur executed the sale deed, in fact, she had no title to the property nor she was in possession thereof.
[1022D E] Jagannathan Pillai vs Kunjithapadam Pillai & Ors., ; Gopal Singh & Ors.
vs Dile Ram (dead) by Lrs. & Ors., Kuldip Singh & Ors.
vs Surain Singh and others, referred to.


judgement:
ivil Appeal No. 1065 of 1987.
From the Judgment and Order dated 21.10.1986 of the Kerala High Court in S.A. No. 491 of 1980.
G. Vishwanatha Iyer, section Balakrishnan and M.K.D. Namboo dri for the Appellants.
T.S. Krishnamoorthy Iyer, A.K. Srivastava and S.C. Birla for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal by leave is from the judgment and order of the High Court of Kerala, dated 21st October, 1986.
It arises in the following circumstances: The building in question which is a shop building No. T.C. 887, M.G. Road, Pazhavangadi, Trivandrum, is part of a pucca three storeyed building belonging to one M.P. Philip and as per his settlement the disputed shop building and two other rooms devolved on one of his sons M.M. Philip.
While this disputed shop building was in the possession of a tenant under the owner, the owner mortgaged the disputed building and the remaining portions to the first defendant with a direction to receive the rent from the tenant.
The mortgagor directed the tenant also to attorn to this mortga gee.
The first defendant subsequently in the course of his management of the mortgaged property, gave the building on lease to the appellants for a higher rent when the former tenant vacated the same.
Subsequently, the owner executed a subsequent mortgage with a direction to redeem the mortgage in favour of the first defendant and before the subsequent mortgagee took steps to redeem the mortgage, the owner assigned his equity of redemption to the respondent.
The respondent and the subsequent mortgagee together as plain tiffs 1 and 2 filed a suit to redeem the mortgage of the first defendant impleading the appel 977 lants as well as respondents and claimed recovery of the khas possession of the building.
The appellants contended that they are tenants of the building inducted into posses sion by the mortgagee as a mode of enjoyment that the mort gage deed authorised the mortgagee to enjoy the building by letting it out and they were not liable to be evicted through a decree of court in a redemption suit without an order under the Kerala Building (Lease & Rent Control) Act, 1965 (hereinafter referred to as 'the Act ').
The trial court decreed the suit and directed recovery of possession of the shop building on the ground that the mortgagee could not induct a tenant and give him any right to continue in pos session even after the redemption of the mortgage.
On appeal by the appellants, the first appellate court held that the disputed building was a shop building which was never in the enjoyment of the owner and the mode of enjoyment of the owner of the property was by letting it out and when the mortgagee enjoyed the property in that manner, by letting it out, the person put in possession as a tenant was entitled to continue in possession even after redemption, until evicted under the Rent Control Act.
The first appellate court further found that the mortgage deed impliedly autho rised the mortgagee to let out the building.
In that view the decree for khas possession of the shop building in possession of the appellants was denied to the respondent.
The respondent filed a second appeal before the High Court, raising the following three contentions: (1) Whether under section 76(a) of the Trans fer of Property Act, 1882, a tenancy created by the mortgagee in possession of an urban immovable property would be binding on the mortgagor after redemption of the mortgage, assuming that the tenancy was such as a pru dent owner of property would have granted in the usual course of management.
(2) Whether a tenancy created in exercise of a general power to grant a lease expressly or impliedly conferred on the mort gagee would survive the redemption of the mortgage in view of Sec.
111(c) of the Trans fer of Property Act, 1882; and (3) Whether a tenant inducted on the property by a mortgagee with possession, would after redemption of the mortgage be protected under the provisions of section 11(1) of the Act.
The High Court was of the view that as the appellants had not pleaded that they were inducted into possession by the mortgagee as 978 prudent act of management, it was not open to the appellants to contend that they could continue in possession even after redemption.
Further, the High Court was of the view that it was not open to the mortgagee to induct a person into pos session which conferred any right on the tenant to continue in possession even after redemption.
The High Court categorically came to the conclusion that protection under section 76(a) of the was never claimed in the written statement.
On the other hand, it was contended by the appellants that this was a pure question of law unconnected with the question of fact and, therefore, no pleadings were necessary and even without pleading such contention could be raised and considered by the Court at the time of argument.
Whether a particular lease is bona fide or prudent act of management, is primari ly a question of fact, though whether on account of the bona fide or prudent act of the mortgagor his lessee was entitled to continue even after the mortgage was determined, is a question of law.
The High Court was of the view that the decision on the question of law is dependent on the question of fact whether the lease was bona fide or a prudent act of a person of ordinary prudence, who would manage it as if it were his own.
On that question of fact, there should be definite pleading so that the plaintiff must have an oppor tunity of meeting the claim and adduce evidence in rebuttal.
The High Court therefore could not sustain the right of the tenant under section 76(a) of the , as a matter of prudent management.
There was no issue in this respect and the judgment of the trial court did not show, according to the High Court, that such a contention was raised.
The only contention that was raised was that the lease was with the knowledge or consent of the mortgagor.
The High Court further came to the conclusion that there was no evidence in support of that contention.
The finding of the District Judge that the mortgagee had implied authority of the mortgagor to let out, was not only lacking in plead ings or issue, but it was also not warranted by the provi sion of the mortgage deed or the evidence.
The High Court relied on several decisions and came to the conclusion that the provision of Sec.
76(a) of the , which was an exception to the general rule embodied in Sec.
111(c) applies in appro priate cases ordinarily only to the management of agricul tural lands and had seldom been extended to urban property so as to tie up in the hands of lessee or to confer on him rights under special statutes.
The High Court further came to the conclusion that the general 979 proposition of law is that no man can convey a better fight than he himself has.
Therefore, a mortgagee in possession cannot create tenancy with a right to continue in possession beyond the period of redemption.
Normally, lease by the mortgagee is determined when the mortgage is redeemed since there is no privity between the mortgagor and the lessee.
The question of prudent management under Sec.
76(a) of the by granting of lease or otherwise normally arises only in rural agricultural lands and not in urban immovable property.
The High Court further came to the conclusion that a mere authorisation to the mortgagee to lease the property itself does not amount to any intention to allow expressly the creation of a tenancy beyond the term of the mortgage.
Only where the words of the mortgage deed clearly and expressly allowed creation of tenancy beyond the term of the mortgage that the lease would be binding on the mortgagor.
In that view of the matter, the High Court held that the learned District Judge was wrong in holding that the defendants Nos. 2 & 3 were not liable to be evicted in this suit and that they could be evicted only through an order of a competent Rent Controller.
In the premises, the second appeal was allowed and a decree for eviction was passed.
Aggrieved thereby, the appellants have come up before this Court.
The question is was the High Court right.
The first contention of Sri Vishwanatha Iyer, learned counsel for the appellants, was that in view of the terms of the mortgage in the instant case, the appellants were enti tled to be in possession after redemption of mortgage as against the mortgagor.
He drew our attention to the mortgage deed dated 4th July, 1960.
The mortgagor in that mortgage deed stated that he was the absolute owner of the property and therefore he was mortgaging the property.
Thereafter, the deed proceeded to state as follows: "This property is hereby secured to you on otti for a term of 2 years for Rs.7,000 which I have received as recited hereunder.
There fore, you may possess and enjoy the property by collecting the rent from the tenants and after the expiry of two years I shall pay you the sum of Rs.7,000 and get a release of the otti ands the expenses for the release should be shared by us.
" The mortgagee was to enjoy the property by collecting the rent from the tenants.
This mortgage was renewed for the second time on 980 17th August, 1977.
The second mortgage deed recited that the shop in Item I which was in possession of Carona Shoe Compa ny, was given for enjoyment.
Therefore, the fact that the tenant was there, is accepted.
It was contended that as no amount was being paid as interest, the mortgagee was entitled to the benefit, that is to say, the rent from the premises in question.
It was contended that the High Court was wrong in holding that it was not an act of prudent management.
Sri Iyer referred to the document dated 3rd June, 1977 which recited as follows: "But the portion where the Ringal shop was situate alone was given possession to you and the remaining portion forming upstairs to the shop previously Ringal Shop, now Carona Shoe Mart, and the shed portion behind it was let out to Chellamma Pillai by the mortgagor and she is occupying it while so the mortgagor has executed a subsequent mortgage and an agree ment for sale to Chellamma Pillai and she is entitled to redeem you and recover posses sion of the building." These contentions, in our opinion, are concluded by the decision of this Court in PomaI, Kanji Gvoindji & Ors.
vs Vrajlal Karsandas Purohit & Ors., [1988] 4 Jmt.
Today SC 307, wherein it was held that except in cases where the leases specifically and categorically make exceptions in favour of the tenants that they would continue to be in possession even after the expiry or termination of the mortgage, and those leases are acts of prudent management, the tenants inducted by the mortgage would be entitled to the protection under the Rent Act after the redemption of mortgage .and in no other cases.
Sri Iyer, in our opinion, is wrong in contending that in the instant case the mortgage deed specifically empowered the mortgagor to induct tenant who would continue to be in possession even after the redemption or end of the mortgage.
It is true that the mortgage deed recited that the tenants were there.
It is also true that the mortgage deed also enjoined that the method of realisation of the rent as the method of having the usufruct of the mortgage by the mortga gee.
But it must be understood that so long as the mortgage subsisted, there was relationship of tenant and landlord.
It could not be so after the mortgage was redeemed.
There is nothing in the mortgage deed in the instant case which warranted the conclusion that the mortgagee could 981 induct tenants who Would continue beyond the term of the existence of the mortgage or who would be given rights even after the expiry of the mortgage.
Sri Iyer then submitted that this Court in the aforesaid decision had referred to another decision of this Court, namely, Jadavji Purshottam vs Dhami Navnitbhai Amaratlal & Ors., where it was held that if the lease granted to the tenant by the mortgagee had the approval or concurrence of the mortgagor, the same would entitle the tenant to claim tenancy rights even as against the mortgagor after he had redeemed the mortgage, then in such a case, such tenants would continue to be in possession.
Sri Iyer drew our attention to the observations of this Court in the aforesaid decision at para 13 of page 236 of the report.
With reference to the term of the mortgage in the instant case and the communications between the parties, Sri Iyer tried to contend that the lease granted in favour of the appellants by the mortgagee had the approval or concurrence of the mortgagor.
We are, however, unable to accept or find in the correspondence any such approval or concurrence.
We have referred to the mort gage deed and the sale deed as mentioned hereinbefore.
Sri Iyer drew our attention to a letter dated 7th October, 1977 addressed to the Rent Controller with a copy to the General Manager, Carona Shoe Co. Ltd. Therein, the respondent had negotiated or made an offer and expressed preference for the appellant company.
The letter contained the following state ments: "Under the circumstances, I have now finally decided to settle all the issues and start the construction of the rear portion as early as possible as I have two more offers (other than yours) for renting out the entire ground floor (about 1,500 sq.
ft.) which includes the space now occupied by you and a portion of the first floor.
I am writing this letter to you because my first preference is for your company.
The main reason is that you are conducting the business in the same shop for some years.
Second thing is that I have already agreed to you at the discussion even though there was no written consent.
In the light of the above, I give below my terms and conditions for renting out the shop with additional space annexed, if you are interested to continue the business in my building.
Of course, the expenses (portion) for the same will have to be borne by you.
But I will provide you with a very good show room considering your requirements.
Necessary bathroom, lavatory, office cabin etc.
will also be provided in consulta 982 tion with your representative.
I had a discus sion with Mr L.W. Baaker, A.R.I.B.A. (The British Architect who is doing so many artis tic modern buildings and show room etc.
throughout India including the Chitralekha Film Studio) and the article Director and Interi or Decorator of our Studio regarding the subject.
" Thereafter, certain terms and conditions of the proposed lease were suggested.
Ultimately, however, no such lease was executed.
This communication strictly, in our opinion, negates the submission that there was any concurrence or approval of the mortgagor of the continuance of the appel lant 's as tenants after the expiry or redemption of the mortgage.
It was then submitted by Sri Iyer that in view of the provisions of the Act, it was not possible for the respond ents to execute the decree.
After an exhaustive discussion of the relevant authorities, it has been held by this Court in Pomal Kanji Govindji 's case (supra) that in respect of the urban immovable properties, the tenants do not get any protection after the redemption of mortgage.
Sri Iyer, however drew our attention to Sec. 11 of the Act, to contend that notwithstanding anything contained in any other law or contract, a tenant shall not be evicted, whether in execu tion of a decree or otherwise, except in accordance with the provisions of the Act.
He drew our attention to the defini tion of 'tenant ' under sec.
2(6) of the Act which defines a tenant as a person by whom or on whose account rent is payable for a building and includes the heir or heirs of a deceased tenant and a person continuing in possession after the termination of the tenancy m his favour.
Similarly, landlord is defined under section 2(3) of the Act as follows: "(3) "landlord" includes the person who is receiving or is entitled to receive the rent of a building, whether on his own account or on behalf of another or on behalf of himself and other or as an agent, trustee, executor, administrator, receiver or guardian or who would so receive the rent or be entitled to receive the rent, if the building were let to a tenant.
" But in view of the said definitions, we are of the opinion that between the appellants and the respondent, there was never any landlord or tenant relationship.
The appellants were never the tenants of the respondent.
Sri Iyer drew our attention to the observations of this 983 Court in Raj Brij Krishna & Anr.
S.K. Shaw & Bros., , where it was held that the non obstante clause would be applicable.
Our attention was drawn to the observa tions of Fazal Ali, J. at page 150 of the report.
There, the Court observed that Section 11 of the Bihar Buildings (Lease, Rent & Eviction) Control Act, 1947 was a self con tained section, and it was wholly unnecessary to go outside the Act for determining whether a tenant was liable to be evicted or not, and under what conditions he could be evict ed.
But in the instant case, the appellants were not the tenants.
The respondent, the original mortgagor, would never after the redemption of the mortgage have treated the appel lants to be tenants.
There was no relationship ever between the appellants and the respondent.
The mortgagor had a separate and distinct interest which was wiped out on the redemption of the mortgage or expiry of the period of mort gage.
The mortgagor on redemption of mortgage gets back his own right, he is not the successor in interest of the mort gagee.
Interest, if any, created by the mortgagee on the mortgagor 's right, must disappear on ceasing of interest of the mortgagee.
In that view of the matter, in our opinion, thus the said observations would not be of any relevance to the present case.
Similarly, reliance was placed on the observations of this Court by Sri Iyer in M/s Raval & Co. vs
K.G. Ramachandran & Ors., ; The observa tions that the definitions of 'landlord ' and 'tenant ' might apply even if the contractual tenancy has come to an end.
But that is not the situation here in the instant case.
In the said case, Bhagwati, J. as the Chief Justice then was, in his judgment at page 439 of the report observed that sub section (1) of section 4 of the Act in question i.e., Tamil Nadu Buildings (Lease & Rent Control) Act, 1960 con templated that an application for fixation of fair rent of a building might be made by the tenant or the landlord.
The definition of 'tenant ', it was observed, included contractu al tenant as well as tenant remaining in possession of the building after determination of the contractual tenancy, i.e. statutory tenant, and both contractual tenant and statutory tenant could, therefore, apply.
It was, therefore, submitted in this case that on the analogy of the contractu al tenant, the appellants were entitled to the protection of the Act.
We are unable to agree.
It is not a question of a contractual tenancy coming to an end.
The limited estate created in favour of the mortgagee having disappeared, all rights emanating from that limited estate disappear and the superior fight of the mortgagor comes not in place of the mortgagee but as a result of an independent title, and as such the mortgagor cannot be bound by any act created or any relationship contracted between the mortgagee and the ten ant, unless it is permitted by the mortgage deed Reliance was also placed on certain observations of 984 this Court in V. Dhanpal Chettiar vs Yesodai Ammal, 14.
Therein, it was held that under the State Rent Acts, the concept of contractual tenancy has lost much of its significance and force.
Therefore, giving of the notice was a mere surplusage and unlike the law under the , it does not entitle the landlord to evict the tenant.
In our opinion, the observations of the said decision cannot have any assistance or significance for the purpose of the issues involved in the present controver sy.
Our attention was also drawn to the observations of this Court in Pomal Kanji Govindji 's case (supra) at para 42 of page 326 and it was contended that in this case impliedly the mortgage deed specifically and categorically made an exception in favour of the tenants that they would continue in possession even after the termination or redemption of the mortgage and that these leases were acts of prudent management.
In this connection, reference may be made to Section 60 of the .
It is this which gives the mortgagor right to redeem after the date fixed for payment.
The mortgagor 's right of redemption and the mortga gee 's right of foreclosure or sale are co extensive.
Simi larly, Section 76(a) of the which determines the liabilities of the mortgagee and imposes the obligation to manage the property as a person of ordinary prudence.
In the instant case, it has been held by the High Court that the induction of the appellants as tenant was not an act of prudent management.
Our attention was also drawn by Sri Iyer to the observa tion of this Court in Gian Devi Anand vs Jeevan Kumar & Ors., ; in support of his submission that in the emerging jurisprudence of tenancy legislation the dis tinction between statutory tenant and contractual tenant has disappeared.
The said view, in our opinion, would be of no avail as the respondent is not the successor in interest and does not come in place of the mortgagee but by virtue of its independent title.
Reliance was also placed on the observations of this Court in G. Ponniah Thevar vs Nalleyam Perumal Pillai & Ors., ; That decision, in our opinion, has no application.
The person inducting the tenant appellant was a co widow who had a life interest in the lands.
It was observed that the terms of the statutory protection applied clearly to all tenancies governed by the Madras Cultivating Tenants Protection Act irrespective of the nature of fights of the person who leased the land so long as the lessor was entitled to create a tenancy.
In our opinion, the said observations would not be applic 985 able.
The said decision deals with the right of the co widow in the land.
Reference may be made to the facts of that case at page 504, para 10.
In our opinion, in view of the said facts, the decision would not apply to the facts of the instant case.
On the other hand, in view of the facts and ratio of the principle of the decisions in Jadavji Purshot tam, (supra) and PomaIii Govindji, (supra) we are of the opinion that the contentions of Sri Iyer cannot be sus tained.
The non obstante clause in Section 11(a) of the Act is applicable only to a decree for eviction obtained by a landlord against a tenant.
The appellants were never the tenants of the respondent.
In the aforesaid view of the matter, we are unable to accept the submissions urged in this case and, therefore, the appeal must fail.
But in view of the fact that the appellants have been carrying on the business for some time in the premises in question in order to enable them to adjust their business, we direct that the order for eviction of the appellants should not be executed upon 31st October, 1989 if the appellants give an undertaking within a period of four weeks from this date to give vacant possession in a peaceful manner on 3 1st October, 1989; and also containing the usual terms of undertaking.
In default of such undertak ing being given within the time aforesaid, the decree will be forthwith executed.
The appeal is accordingly dismissed with costs.
Y.L. Appeal dis missed.

summary/full:
The appellants are tenants.
The premises in dispute is a shop building bearing No. T.C. 887, M.G. Road, Pazhavangadi, Trivandrum, part of a Pucca three storeyed building owned by one M.P. Phillip.
As per the settlement the shop in dispute devolved on one of his sons, while the shop was in the possession of the tenant.
During the tenancy owner mortgaged the premises in dispute and the remaining portions to the first defendant with a direction to receive the rent from the tenant.
The tenant was asked to attorn to the mortgagee.
The first defendant in course of management of the property gave the building on lease to the appellants for a higher rent; the earlier tenant having vacated the same.
The owner thereafter executed the second mortgage with a direction to redeem the mortgage in favour of the first defendant and before the subsequent mortgagee took steps to redeem the mortgage, the owner assigned his equity of redemption to the respondent.
The Respondent and the subsequent mortgagee together as plaintiffs 1 & 2 filed a suit to redeem the mortgage of the first defendant impleading the appellants as parties and claimed recovery of the Khas possession of the building.
The appellants contended (i) that they are tenants of the build ing inducted into possession by the mortgagee as a mode of enjoyment; (ii) that the mortgage deed authorised the mort gagee to enjoy the building by letting it out and that they were not liable to be evicted through a decree of Court in redemption Suit without an order under the Kerala Building (Lease and Rent Control) Act 1965.
The trial Court decreed the suit and directed recovery of possession of the Shop building.
It took the view that the mortgagee could not induct a tenant and give him any right to continue in possession even after the redemption of the mortgage.
975 On appeal, the first appellate Court held that the disputed building was a shop building which was never in the enjoyment of the owner; mode of enjoyment of the owner being by letting it out and when the mortgagee enjoyed the proper ty in that manner by letting it out, the person put in possession as a tenant was entitled to continue in posses sion even after redemption, until evicted under the Rent Control Act.
It also found that the mortgage deed impliedly authorised the mortgagee to let out the building.
In that view of the matter, the trial Court 's order was set aside.
The Respondent thereupon filed a second appeal before the High Court The High Court took the view that it was not open to the mortgagee to induct a person into possession which conferred any right on the tenant to continue in possession even after redemption.
Accordingly it allowed the appeal and a decree for eviction was passed.
Hence this appeal by the appellants tenant.
Dismissing the appeal, but directing that the decree for eviction should not be executed till the 31st October, 1989 if the appellants give usual undertaking to deliver vacant possession on 31st October, 1989, this Court, HELD: That the mortgagor on redemption of mortgage gets back his own right; he is not the successor in interest of the mortgagee.
Interest, if any, created by the mortgagee on the mortgagor 's right, must disappear on ceasing of the interest of the mortgagee.
[983C D] The limited estate created in favour of the mortgagee having disappeared, all rights emanating from that limited estate disappear and the superior right of the mortgagor comes not in place of the mortgagee but as a result of an independent title, and as such the mortgagor cannot be bound by any act created or any relationship contracted between the mortgagee and the tenant, unless it is permitted by the mortgage deed [983G H] The mortgagor 's right of redemption and the mortga gee 's right of foreclosure or sale are co extensive.
[984D] Jadavji purshottam vs Dhani Navnitbhai Amaratlal & Ors., and Pornal Kanji Govindji & Ors.
vs Vrajlal Karsandas Purohit & Ors., [1988] 4 Judgment Today SC 307, followed.
976 Raj Brij Raj Krishna & Anr.
S.K. Shaw & Bros., ; M/s. Raval & Co. vs
K.G. Ram Chandran & Ors., ; ; V. Dhanpal Chettiar vs Yesodai Ammal, ; ; Gian Devi Anand vs Jeevan Kumar & Ors., ; and G. Ponnial Thevar vs Nalleyam Perumal Pillai & Ors., ; not applicable.