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PETITIONER: CHIRANJI LAL KHAITAN & ORS.

       Vs.

RESPONDENT: MOTI LAL SARAOGI

DATE OF JUDGMENT04/08/1971

BENCH: HEGDE, K.S. BENCH: HEGDE, K.S. GROVER, A.N.

CITATION:  1971 AIR 2116            1972 SCR  (1)  22

ACT: Bihar & West Bengal (Transferred Territories) Act, 1956-West Bengal  Transferred Territories (Assimilation of Laws)  Act, 1958-West Bengal Non-Agricultural Tenancy Act, 1949-Suit for ejectment  of tenant filed in Bihar territory  after  notice under  s.  106 of T.P. Act-Suit  decreed-Appeal  pending  in Patna High Court-Territory transferred to West Bengal-Appeal transferred  to Calcutta High Court Suit whether liable  to be  dismissed  for  want  of six  months’  notice  under  s. 9(1)(b)(iii) of 1949 Act-Section whether made applicable by 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(1)(b)(iii).

HEADNOTE: 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.   Allow- ing the appeal, HELD  : (i) The provisions of the 1949 Act did not apply  to the ’transferred territories’ on their own force.  They were extended  to these territories under the provisions of  1958

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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 repealed and ’further saved anything done or suffered  under those laws. [28C-E] In  other words because of cl.(a) of the proviso  to  s.3(2) acts duly ,done under the repealed laws are protected.   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 and was therefore protected.  Its 23 validity  could not be tested on the basis of the  provision of  the  1949  Act.   This  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  trans- ferred  territory  before their transfer.   The  legislature would not have intended such a result. [28E-G] (ii)The  liability to pay reasonable compensation  for  the structure,.,  Put up by the tenant arises under the  proviso to cl.(iii) of 9.9(1)(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 question of paying compensation did not arise. [28H-29B]

JUDGMENT: CIVIL  APPELLATE JURISDICTIONION: Civil Appeal No.  1973  of 1966. Appeal from the Judgment and decree dated August 30, 1965 of the Calcutta High Court in Appeal from Appellate Decree  No. 1033 of 1956. V.S.  Desai,  Krishna Sen and B. P  Maheshwari,  for  the appellants. D.N. Mukherjee and A. G. Ratnaparkhi, for respondent, No. 1 (a). The Judgment of the Court was delivered by Hegde,J.--This  appeal by certificate arises from the  deci- sion of the Calcutta High Court in its appellate decree  No. 1033 of 1956.  The appellants are the legal representatives. of the. original plaintiff Chiranji Lal Khaitan.  The plain- tiff  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  oral lease.   The defendant took on lease that property  for  the purpose of carrying on his motor business.  But in the  year 1947  without the plaintiff’s knowledge the defendant  cons- tructed several structures on the land.  In 1948 the  plain- tiff asked him to remove those structures but the  defendant did  not comply with that demand, hence in  September  1948, the plaintiff served on him a notice to quit determining the tenancy  With  effect from the 1st November, 1948.   As  the defendant did not surrender possession of the  property,-the plaintiff instituted the suit from which this appeal M 1245 Sup CI/71 24 arises  on  January  3,  1940 in the  court  of  Muinsif  at Purulia.   At the time of the institution of the  suit,  the

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suit  property was 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  ill  May, 1952, as prayed for  and  directed  the defendant  to  deliver vacant possession of  the  suit  plot after removing the structures put up by him.  The decree  of the trial court was affirmed by the List appellate court  on July 11, 1952.  Meanwhile in 1956, some of the border  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 stood transferred to the State of West Bengal  is  that concerned in the present  litigation.   The transfer  in question took place on November 1,  1956.   The defendant filed a ,second appeal. against the aforementioned decree  in High Court of Patna on September 7, 1956 and  the same  was admitted by the High Court on September 10,  1916. That appeal stood transferred to the High Court of  Calcutta under  the provisions of the Bihar and West Bengal  Transfer of  Territories Act, 1956, the Act under which the  transfer of  territories mentioned earlier took place.  Part  VIl  of that  Act  provided  that  the law  then  in  force  in  the transferred  ,territories  was to continue  until  otherwise provided  by the ,competent legislature or  other  competent authority.  In 1959 the West Bengal legislature enacted  the West  Bengal Transferred Territories (Assimilation of  Laws) Act, 1958 (to be hereinafter referred to as the ’1958 Act’). That Act came into force on July 1, 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. ,               (1)That  the  plaintiff’s claim is  barred  by               equitable estoppel and               (2)   -the  suit  is liable  to  be  dismissed               under’ s.  9  read  with  s. 80  of  the  West               Bengal Non-agricultural Tenancy Act, 1949  (to               be hereinafter referred to as the ’1949’ Act). The High Court rejected the first contention.  Agreeing with the courts below, it came to the conclusion that there is no reliable evidence to show that the structures in question  25 were  put  up either with the consent or  knowledge  of  the plaintiff.   But it accepted the second contention  advanced on  behalf of the defendant and dismissed the  suit.   Hence this appeal. All   the  courts  below  have  concurrently  come  to   the conclusion  that the defendant has failed to  establish  his plea  of  equitable estoppel.  That conclusion is  based  on findings  of  fact.   We  see  no  reason  to  review  those findings. The  only question that we have to consider is  whether  the High Court was right in holding that the suit for  ejectment ought  to fail for non-compliance of s.  9(1)(b)(iii).   The High Court held that the plaintiff having failed to give six months’  notice before 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 ’1949’ Act is not applicable to the facts of the case. 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  of  the  suit.  It was not  disputed  that  the notice  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

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provisions  of  the 1958 Act’, the suit  which  was  validly instituted has ceased to be maintainable. We have earlier seen that under the provisions of the  Bihar and  West  Bengal (Transfer of Territories) Act,  1956,  the existing laws were continued till appropriate provisions are made by the concerned legislatures.  Therefore s. 106 of the Transfer  of  Property Act continued to be in force  in  the area concerned till the 1958 Act’ came into force.   Section 3 of that Act provides               "(1) All State laws which, immediately  before               the  appointed day, extend to, or are  not  in               force in, the State of West Bengal, but do not               extend  to,  or  are  not  in  force  in,  the               transferred territories shall as  from  that               day,  extend to or, as the caes may  be,  come               into force in the transferred territories.               26               Provided that the State law specified in Sche-               dule   I  shall  extend  to  the   transferred               territories subject to the amendment specified               in that Schedule;               (2)All State laws which, immediately before               the appointed day are in force in the whole or               any  1,art 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 Slate  law  so               repealed  or  anything duly done  or  suffered               thereunder ; or               (b)any,  right, privilege,  obligation,  or               liability acquired, accured or incurred  under               any State law so repealed ; or               (c)any   penalty,  forfeiture  or   punishment               incurred  in respect of any offence  committed               against any State law so repealed ; or               (d)any  investigation,  legal  proceeding   or               remedy   in   respect  of  any   such   right,               privilege,  obligation,  liability,   penalty,               forfeiture or punishment as aforesaid and  any               such investigation, legal proceeding or remedy               may  be instituted, continued or enforced  and               any such penalty, forfeiture or punishment may               be  imposed,  as  if this  Act  had  not  been               passed........               (The  remaining,portion of the section is  not               relevant for our present purpose.)               The expression "State law" is defined thus  in               S. 2(b)               "" State law" means so much of any  enactment,               ’ordinance or regulation as relates to. any of               the matters enumerated in Lists II and III  in               the  Seventh Schedule to the Constitution  and               include   any  order,  by-law,  rule,   Scheme               notification  or other instrument  having  the               force of law"..  27 One  of the statutes that stood extended to the  transferred territories under the ’1958 Act’ is the ’1949 Act’. Section 9(1)(b)(iii) of that Act provides :               "(1)  Notwithstanding anything  contained  in.               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

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             but less than twelve years-               (b)without a lease in writing (C)........               then the tenant holding such  non-agricultural               land  shall be liable to ejectment on  one  or               more   of  the  following  grounds   and   not               otherwise namely ;               (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 tenancy served on the  tenant  in               the prescribed manner in the case of tenancies               of the class specified in clause (b), ;               Provided that a tenant shall not be liable  to               ejectment  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 Act which says :               "The provisions of this Act shall have  effect               in   respect   of  all   suits,   appeals   or               proceedings including proceedings in execution               for  ejectment  of a  non-agricultural  tenant               which are pending at the date of  commencement               of this Act. The  contention based on s. 9(1)(b)(iii) was taken  for  the first time in the High Court of Calcutta.  The High Court as mentioned  earlier  has accepted that contention.  If  s.  9 read  with S. 88 of the ’1949 Act’ governs this appeal  then undoubtedly the plaintiff’s suit has to fail.  But the 28 question is whether those provisions are not subject to 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  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(1)(b)(iii)  of that Act.  Therefore if the  plaintiff  was required to comply with the provisions of the ’1949 Act’  in 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’. As  seen earlier S. 3 of that Act while repealing  the  laws that  Were  in  force  in  the  ’transferred  territory  and extending  the laws that were in force in the rest  of  West Bengal saved the previous operation of the existing laws  so repealed  and further saved anything duly done  or  suffered under those laws.  In other words because of cl. (a) of  the proviso  to 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’.  That interpretation also advances public

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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  their   transfer.    The legislature would not have intended such a result. If  the plaintiff was not required to comply  with  require- ments  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 compensation  for  the structures put up by  the  defendant. The  liability  to  pay  reasonable  compensation  for   the structures put up by the tenant arises under the proviso  to cl. (iii) of  29 s.9(1)(b). That proviso imposed the liability to pay reason- able  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  was not made under that provision, the question  of paying compensation does not arise. 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 is  restored. Parties to bear their own costs in this Court and in the High Court. G.C.                                    Appeal allowed. 30