# ASA RAM AND ANOTHER 1\'ovember, 21 v. MST. RAM KALI AND ANOTHER

- **Citation:** [1958] 1 S.C.R. 988
- **Court:** Supreme Court of India
- **Decided:** 1957-02-06
- **Case number:** Civil Appeal No. 56 of 1956
- **Bench:** Venkatarama Aiyar, S. K. DAs, Gajendragadkar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/asa-ram-and-another-1-ovember-21-v-mst-ram-kali-and-another-1450
- **Pages:** 11

## Headnote

(19581
Tenancy-Hereditary right, when can come into existence-Lease by mortgagee-When binding on mortgagorTransfer of Property Act, 1882 (IV of 1882), s. 76(a)-U.P.
Tenancy Act, 1939 (U.P. XVII of 1939), s. 29 (a).
Section .29 (a) of the U.P. Tenancy Act, 1939, provides
that every person who was at the commencement of the
Act a tenant of land shall be entitled to all the rights of
hereditary tenants under the Act. Some classes of
tenants are expected from the operation of this provision,
and one of them is tenants of Sir lands.
The lands in question were originally held in Sir but in
pursuance of a deed of usufructuary mortgage dated July 8,
1930, they were entered as Khudkasht in the names of the
mortgagees. Subsequently the respondents took possession
of the lands from the mortgagees under a Kabuliat dated
May 26, 1936. After redemption of the mortgage the
appellants, the representatives of the mortgagors, filed a
suit for possession under s. 180 of the U.P. Tenancy Act,
1939, against the respondents on the footing that they were
trespassers. The respondents contended, inter alia, that they
were legally in possession of the lands because (1) the lease
on the basis of which the Kabuliat of May 26, 1936, was
executed, was binding on the appellants, and (2) in any
case, as the respondents were in possession of the lands
as tenants on the date of the commencement of the Act,
they were entitled to all the rights of hereditary tenants
under s. 29 (a) of the Act. It was found that the action of·
the mortgagees in leasing the lands to the tenants on the
terms set out in the Kabuliat was neither prudent nor
bona fide:
Held: (1) that under s. 76(a) of the Transfer of Property Act, 1882, an agricultural lease created by a mortgagee would be binding on the mortgagor even though the
mortgage has been redeemed, provided it is of such a character that a prudent owner of property would enter into
it in the usual course of management;
(2) that a person who claims rights as a hereditary
tenant under s. 29 (a) of the U.P. Tenancy Act, 1939, must
show that on the date of the commencement of the Act
he was lawfully a tenant.
Accordingly, as the lease in question could not be upheld under s. 76 (a) of the Transfer of Property Act, 1882,
there was no admission of tenant by any person having
S.C.R.
SUPREME COURT REPORTS
989
authority to do so, and the transaction could not form the
foundation on which any rights under s. 29 (a) of the U.P.
Tenancy Act, 1939, could be based.
Mahabir Gope and others v. Harbans Narain Singh and
others, [1952] S.C.R. 775, referred to.

## Text

988
SUPREME COURT REPORTS
1951
ASA RAM AND ANOTHER
1\'ovember, 21 .
V.
MST. RAM KALI AND ANOTHER
(VENKATARAMA AIYAR, S. K. DAs and
GAJENDRAGADKAR, JJ.)
(19581
Tenancy-Hereditary right, when can come into existence-Lease by mortgagee-When binding on mortgagorTransfer of Property Act, 1882 (IV of 1882), s. 76(a)-U.P.
Tenancy Act, 1939 (U.P. XVII of 1939), s. 29 (a).
Section .29 (a) of the U.P. Tenancy Act, 1939, provides
that every person who was at the commencement of the
Act a tenant of land shall be entitled to all the rights of
hereditary tenants under the Act. Some classes of
tenants are expected from the operation of this provision,
and one of them is tenants of Sir lands.
The lands in question were originally held in Sir but in
pursuance of a deed of usufructuary mortgage dated July 8,
1930, they were entered as Khudkasht in the names of the
mortgagees. Subsequently the respondents took possession
of the lands from the mortgagees under a Kabuliat dated
May 26, 1936. After redemption of the mortgage the
appellants, the representatives of the mortgagors, filed a
suit for possession under s. 180 of the U.P. Tenancy Act,
1939, against the respondents on the footing that they were
trespassers. The respondents contended, inter alia, that they
were legally in possession of the lands because (1) the lease
on the basis of which the Kabuliat of May 26, 1936, was
executed, was binding on the appellants, and (2) in any
case, as the respondents were in possession of the lands
as tenants on the date of the commencement of the Act,
they were entitled to all the rights of hereditary tenants
under s. 29 (a) of the Act. It was found that the action of·
the mortgagees in leasing the lands to the tenants on the
terms set out in the Kabuliat was neither prudent nor
bona fide:
Held: (1) that under s. 76(a) of the Transfer of Property Act, 1882, an agricultural lease created by a mortgagee would be binding on the mortgagor even though the
mortgage has been redeemed, provided it is of such a character that a prudent owner of property would enter into
it in the usual course of management;
(2) that a person who claims rights as a hereditary
tenant under s. 29 (a) of the U.P. Tenancy Act, 1939, must
show that on the date of the commencement of the Act
he was lawfully a tenant.
Accordingly, as the lease in question could not be upheld under s. 76 (a) of the Transfer of Property Act, 1882,
there was no admission of tenant by any person having
S.C.R.
SUPREME COURT REPORTS
989
authority to do so, and the transaction could not form the
foundation on which any rights under s. 29 (a) of the U.P.
Tenancy Act, 1939, could be based.
Mahabir Gope and others v. Harbans Narain Singh and
others, [1952] S.C.R. 775, referred to.
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 56
of 1956.
Appeal by special leave from the judgment and
order dated February 4, 1954, of the U.P. Board of
Revenue in Appeal No. 96 of 1948-49.
Dewan Charanjit Lai, for the appellants.
S. P. Sinha, J. B. Dadachanji, S. N. AndLey and
Rameshwar Nath, for the respondents.
1957, November 21. The following Judgment of .
the Court was delivered by
VENKATARAMA AIYAR J.-The facts material for
purposes of this appeal have been stated by us in our
order dated February 6, 1957, and may be briefly recapitualted. The suit property is agricultural land of
the extent of 10 Bighas, 13 Biswas. On July 8, 1930,
the then owners of the land, Ram Prashad and Udairaj, executed a usufructuary mortgage over it and certain other properties, with which we are not concf;!rned
in this litigation, in favour of Dwaraka Prashad,
N aubat Singh and Munshilal. The lands were originally held in Sir by the mortgagors, but as part of
· their bargain with the mortgagee's, they applied to
have their names removed from the Sir, and that was
done by an order dated June 18, 1930, the lands being
thereafter entered as Khudkasht in the names of the
mortgagees. In 1941, Ram Prashad, the surviving
mortgagor, filed Suit No. 132 of 1941 for redemption
of the mortgage. The suit was contested, but it was
eventually decreed, the amount due to the mortgagees
being fixed at Rs. 1,860. Subsequent to the decree,
Ram Prashad died leaving him surviving, the appellants herein, as his legal representatives. On September 6, 1945, the amount due under the mortgage was
paid by them and the mortgage was redeemed. When
they sought to take possession of the suit properties,
they were obstructed by Govind Sahai and Bhagwan
1957
Asa Ram
v.
Ram Kali.
Venkatarama
A.lyar J.
990
SUPREME COURT REPORTS
[1958)
t9S7
Sahai, who claimed to have been admitted as tenants
Asa Ram
by the mortgagees. Thereafter, the appellants filed
v.
the suit, out of which the present appeal arises, under
Ram 14111
s. 180 of the U.P. Tenancy Act No. XVII of 1939,
Venkatarama
hereinafter referred to as the Act, to eject them, treatAiyar 1.
ing them as trespassers. The defendants resisted
the suit on various grounds, of which only one is now
material. They claimed that they were not trespassers
but hereditary tenants under the Act, and could not
therefore be ejected, and Issue 2 was raised with reference to this plea.
The Revenue Officer, Meerut, who tried the suit
held on this Issue that as the lands had been held by
the mortgagors as Sir, and that as the mortgagees had
been themselves cultivating them as Khudkasht, the
defendants could not be held to be hereditary tenants,
and passed accordingly a decree in ejectment in favour of the appellants, and this decre~ was confirmed
on appeal by the Commissioner, Meerut Division. The
defendants took the matter in appeal to the Board of
Revenue (Second Appeal No. 96 of 1948). By its
judgment and decree dated February 4, 1954, the
Board held that the defendants had been put in possession by the mortgagees under a Kabuliat dated
May 26, 1936, that the rent fixed under the Kabuliat,
Rs. 112 per annum, was a reasonable rate of rent as
the circle rate was Rs. 76-6-0, and that, therefore, the
settlement was binding on the mortgagors, as it was
for "prudent and economic rent". On this finding,
it allowed the appeal and dismissed the suit. Against
this judgment, the plaintiffs have preferred this appeal
by special leave.
At the original hearing before us, the main contention pressed by the appellants was that the Kabuliat
dated May 26, 1936, was not referred to in the.written
statement, and had not been exhibited at the trial,
and that, therefore, no relief should have been granted
on the basis of that document in second appeal. We,
however, came to the conclusion that as the point had
been raised, though not clearly in the written statement, it ought to be tried on the merits, and we ac-
S.C.R.
SUPREME COURT REPORTS
991
cordingly remanded the case to the Board of Revenue for trial on the following two Issues :
(1) Whether the lease deed dated May 26, 1936,
by the mortgagees in favour of the respondents is true
and legally valid; and
( 2 ) Whether the said lease is binding on the
appellants.
At the re-hearing which we directed, the ·parties
have adduced fresh evidence on both the Issues, and
the Board of Revenue has submitted its findings thereon. On the first Issue, it has held that no lease deed
had been executed by the mortgagees in favour of
the lessees, but that the latter had executed a Kabuliat
in favour of the mortgagees on May 26, 1936, and that
its truth had not been questioned. On the second
Issue, its finding is as follows :
"Whether the Qabuliat was binding or not depen:-
ded on the question whether mortgagees had a right
to settle the land and whether such settlement· was
binding on the ~mortgagors. There was nothing in
the mortgage deed which would prevent the mortgagees from settling the land, even though the land
was khud-kasht or even if the period of settlement
was beyond the period of mortgage. The mortgagees
acted in the prudent management of the property
settling the land on an economic rent. The .action of
the mortgagees was, therefore, binding on the mortgagors. Hence the Qabuliat was binding on the
appellants."
The appellants attack. both these findings as incorrect. As regards the first Issue, their contention is
that in view of the finding that the mortgagees had
not executed any lease deed, Govind Sahai and
Bhagwan Sahai could not claim the status of tenants
solely on the strength of the Kabuliat executed by
them on May 26, 1936, as that was merely a unilateral
undertaking by them to cultivate. But the mort- _
gagees have given evidence that they accepted the
Kabuliat and received rent as provided therein. There
is, therefore, no substance in this objection, which
must be overruled.
1957
Asa Ram
v.
Ram Kali
Venkatarama
Aiyar J.
992
SUPREME COURT REPORTS
[1958]
1957
The main controversy in this appeal relates to the
Asa Ram
finding on the second Issue. The papellants complain
v.
that the Board has merely repeated its previous
Ram Kali
finding on the point without reference either to the
Venkatarama
requirements of s. 76(a) of the Transfer of Property
Aiyar J.
Act, or to the evidence that had been adduced by the
parties at the remand. We are constrained to observe
that this complaint is well-founded. The law undoubtedly is that no person can transfer property so
as to confer on the transferee a title better than what
he possesses. Therefore, any transfer of the property
mortgaged, by the mortgagee must cease, when the
mortgage is redeemed. Now, s. 76 (a) provides that
a mortgagee in possession "must manage the property
as a person of ordinary prudence would manage it if it
were his own." Though on the language of the statute,
this is an obligation cast on the mortgagee, the authorities have held that an agricultural lease created by
him would be binding on the mortgagor even though
the mortgage has been redeemed, provided it is of
such a character that a prudent owner of property
would enter into it in the usual course of management.
This being in the nature of an exception, it is for the
person who claims the benefit thereof, to strictly
establish it.
Now, the question is whether the respondents have
proved that the lease of which the Kabuliat dated
May 26, 1936, is a counter-part, is one which a prudent owner would create in the management of his
properties. The Board has answered the question in
favour of the respondents on two grounds. One is that
that the mortgage deed dated July 8, 1930, contains
no prohibition against letting of the lands by the
mortgagees. If there is such a prohibition, there is
the authority of this Court in Mahabir Gope and
others v. Harbans Narain Singh and others (' ) that
the lease will not be binding on the mortgagors. But
where there is no such prohibition, the only consequence is that the parties will be thrown back on their
rights under the Transfer of Property Act, and the
(1) [1952] S.C.B. 775.
S.C.R.
SUPREME COURT REPORTS
993
lessees must still establish that the lease is binding
on the mortgagors under s. 76(a) of that Act.
The second ground on which the Board has based
its conclusion that the lease is binding on the appellants is that the rent fixed in the Kabuliat, Rs. 112 is
higher than the circle rate of Rs. 76-6-0. But this is
not decisive of the matter, as what has to be decided
is not whether the rent fixed compares favourably
with the circle rate, but whether it is reasonable and
fair, having regard to the income which a prudent
owner could have got from the lands, and that will
depend on- proof of the net yield from the land and the
ruling price of the produce at that time. The lessees
have given no evidence on this point.
One of the
mortgagees stated that he and his brothers were themselves cultivating the lands till 1936, and that they
then gave them on lease, because they were losing
Rs. 50 to Rs. 100 per annum over the transaction. But
he gave no particulars as to what the gross yield from
the lands was, what the expenses of cultivation were,
and what the price of the produce was. It is very
difficult to believe that the tenants would have agreed
to take over lands on the terms contained in the
Kabuliat if, in fact, it was a losing concern. It is
admitted by the mortgagee that the lessees made no
complaint that they were working at a loss. His ev.idence on this point is vague and unconvincing, and
we are not impressed by it. On the other hand, we
have evidence which clinches the matter in favour of
the appellants. It has been already stated that the
Rev1mue Officer, Meerut granted a decree in favour of
the appellants for ejectment. In execution of this decree, the appellants obtained possession of the suit
properties. On February 4, 1954, the Board set aside
the decrees of the Courts below, and dismissed the
suit of the appellants. Thereupon, the respondents in
execution of the decree got back possession of the properties.
Then, they applied under s. 144, Code of
Civil Procedure for recovery of mesne profits by way
of restitution, and obtained a decree for Rs. 7,500 at
1957
AsaR.am
v.
Ram Kali
Venkatarama
Aiyar J.
994
SUPREME COURT REPORTS
[1958]
1957
the rate of Rs. 1,000 per annum. If this figure is
Asa Ram
any guide for the determination of what income could
v.
be got from the properties by a prudent owner, then
Rom Kali
it is clear beyond doubt that the rent of Rs. 112 fixed
Venkatarama
in the Kabuliat is unduly low, and it cannot be bindAiyar J.
ing on the mortgagors. It is true that the decree relates to a period much later than the date of the Kabuliat, and that price!; had greatly risen during that
period. But making all allowance for the rise, we
think that the transaction is not one which a prudent
owner would enter into in respect of his properties.
It was argued by Mr. Sinha for the respondents that
the decree passed in restitution proceedings is under
appeal before the Commissioner of Meerut, and should
not, therefore, be taken into account in determining
whether the rent fixed in the Kabuliat was fair and
such, as would be binding on the mortgagors. But
this decree was passed on the application of the respondents claiming mesne profits at the rate of Rs.
1,000 per annum, assuming that they did not ask for
more, and its importance lies not so much in its being
an adjudication by the Court as in its evidencing an
admission by them as to the net profits which could
be realised from the lands.
It would be material in this connection to refer to
the character of the lands over. which the lease was
created. They were held in Sir by the mortgagors
and after the execution of the mortgage, entered as
Khudkasht in the names of the mortgagees. They
were home-farm lands under the direct cultivation of
the proprietors, as distinguished from lands which
were under cultivation by tenants, and having regard
to the special rights which the tenancy laws all over
India have recognised in the owner in respect of such
lands, an act of the mortgagee which puts those rights
in peril cannot, as held in Mahabir Gope and others v.
Harbans Narain Singh and others (supra), be regarded
as that of a prudent owner, and it requires exceptional grounds to justify it. Of that, there is no evidence. On the other hand, the uncontradicted evidence on the side of the appellants is that the lands
S.C.R.
SUPREME COURT REPORTS
995
have got facilities of canal irrigation, and are very
1957
fertile, and that it would not be economic to lease
Asa Ram
them to tenants. It also appears that the mortgagees
v.
created on the eve of redemption another lease, and
Ram Kali
that has been set aside on the ground that it was enVenkatarama
tered into with a view to defeat the mortgagors.
Aiyar J.
Their action in leasing the lands to tenants on the
terms set out in the Kabuliat is neither prudent nor
bona fide, and on a consideration of the entire evidence, we are of opinion, differing from the Board,
that the lease evidenced by the Kabuliat is not binding on the mortgagors.
It was next contended by Mr. Sinha that even if
the Kabuliat was not binding on the mortgagors, the
respondents would, nevertheless, be hereditary tenants under the provisions of the U.P. Tenancy Act,
1939, and that the appellants would have no right to
eject them, and he referred us to the provisions of the
Act bearing oli the question. Section 29(a) of the Act
provides that every person who was at the commencement of the Act a tenant of land shall be entitled to
all the rights of hereditary tenants under the Act.
Some classes of tenants are excepted from the operation of this provision, and one of them is tenants of
Sir lands. Section 30 ( 6) enacts that,
"Notwithstanding anything in section 29, hereditary rights shall not accrue in- -
Land transferred by a mortgage to which the pro~
visions of the second paragraph of sub-section ( 5) of
section 15 of the Agra Tenancy Act, 1926 apply during the period specified in that paragraph."
The provision in the Agra Tenancy Act, 1926, referred
to above, runs as follows :
"Notwithstanding anything in this section, where
the property transferred by means of a mortgage of
the kind specified in sub-section (5) of section 14
consists wholly of a specified a:rea or sir, the mortgagor may by simultaneous agreement in writing
waive his exproprietary rights, and in that case the
mortgaged land shall, if the mortgagor regains within
twelve years of the date of the transfer possession
996
SUPREME COURT REPORTS
[1958}
1957
thereof on redemption of the mortgage, resume the
Asa Ram
character of sir. In such land, statutory rights shall
v.
not accrue for twelve years from the date of transfer."
Ram Kali
One other provision to which reference was made is
Venkatarama
the second proviso to s. 11 of the U.P. Tenancy Act,
Ai,va' J.
1939, which is as follows :
"Provided further that if on redemption of a mortgage the mortgagor regains possession of land which
under the provisions of the Agra Tenancy Act, 1926,
ceased to be sir and to which the provisions of the
second paragraph of sub-section (5) of section 15 of
that Act applied, such land shall again become his
sir."
Now, the argument of the respondents is that
though the suit lands were originally held in Sir, they
ceased to be such when the mortgage was executed
on July 8, 1930, that s. 29(a) of the Act therefore
applied, thats. 30(6) and s. 11 of the Act and s. 15 of
the Agra Tenancy Act, 1926, had no application, as
the mortgage comprised also lands which were not
sir, and as further, possession had not been regained
within twelve years of the mortgage. It is accordingly contended that the respondents who were in possession as tenants on January 1, 1940, when the Act came
into force, had acquired the status of hereditary
tenants under s. 29(a) of the Act, and the decision in
Jai Singh v. Munshi Singh ( 1) is relied on, in support
of this contention.
The error in this argument lies in the assumption
that Govind Sahai and Bhagwan Sahai became by
virtue of the Kabuliat dated May 26, 1936, tenants for
purposes of s. 29 (a) of the Act. The true scope of sub-s.
(a) of s. 29 is that it posits that there is on the date
of the commencement of the Act a person who is lawfully a tenant and proceeds to confer on him certain
rights. It is therefore a condition precedent to the
application of this provision that the person must have
been admitted as tenant by a person who had the
right to do so. Where, however, the person who purports to grant the lease has no authority to do so,
(1) (19SSj A.L.J. 834.
S.C.R.
SUPREME COURT REPORTS
997
whatever the rights inter se between the lessor and
1957
the lessee, as against the true owner the latter does
Asa Ram
not, in law, acquire the status of a tenant, ands. 29(a)
v.
has no 11pplication to him. Thus, if A is the owner of
Ram Kali
certain lands and B trespasses on them and grants a
venkatarama
lease to C, sub-s. (a) of s. 29 does not operate to conAiyar J.
fer any rights on C as against A. The crucial question
for determination, therefore, is whether the person
who claims rights as a hereditary tenant under s. 29(a)
was admitted as tenant by a person who had the right
to do so. An owner will of course be entitled to admit a tenant, and a mortgagee in possession would
have a right to do so, either if he is authorised in that
behalf by the deed of mortgage, or if the transaction
is one, which is protected by s. 76(a) of the Transfer
Qf Property Act. But where the transaction is not one
which could be upheld under s. 76(a), then there is
no admission of tenant by any person having authority to do so, and such a transaction though valid as
between the mortgagee and the lessee, cannot form the
foundation on which any rights under s. 29, sub-s. (a)
<0f the Act could be based.
In Mahabir Gope and others v. Harbans Narain
Singh and others (supra), it was held that when a
usufructuary mortgagee created a lease in spite of the
prohibition against letting, contained in th~ mortgage
deed, the tenant acquired no occupancy rights under
the provisions of the Bihar Tenancy Act, even though
he had been in possession for over 30 years, and that
the same consequences would follow if the lease was
not binding on the mortgagor under s. 76(a) of the
Transfer of Property Act, or if it was not bona fide
On the same principle, and on our finding that the
Kabuliat dated May 26, 1936, is not binding on the
appellants, we must hold that Govind Sahai and
Bhagwan Sahai acquired no rights as hereditary
tenants under s. 29(a) of the U.P. Tenancy Act. In
Jai Singh v. Munshi Singh (supra), relied on for the
respondents, it was held that "the agricultural lease
granted by the mortgagee in favour of Jai Singh was
a lease granted in the ordinary course of management",
998
SUPREME COURT REPORTS
(1958]
1957
and that, accordingly, the tenant acquired the rights
Asa Ram
of a hereditary tenant. That decision has no applicav.
tion when the lease is, as held by us, not a prudent
Ram KaU
transaction binding on the mortgagors. In this view,
venkatarama
the questions raised by Mr. Sinha on the construction
Aiyar J.
of s. 30(6) ands. 11 of the Act ands. 15 of the Agra
Tenancy Act, 1926, do not arise for decision.
1957
November, 25.
In the result, the appeal is allowed, the decree
passed by the Board is set aside, and that of the Revenue Officer, Meerut affirmed by the Commissioner,
restored. The respondents will pay the costs of the
appellants throughout, including the costs of the
remand.
Appeal allowed.
CHOUDHURY DHARAM SINGH RATHI
v.
THE STATE OF PUNJAB AND OTHERS
(S. R. DAS C. J., VENKATARAMA AIYAR, S. K. DAS,
GAJENDRAGADKAR and A. K. SARKAR JJ.)
Preventive · Detention-Failure of the Advisory Board
to submit its report within time-Effect-Detenu, if must
be set at liberty-Preventive Detention Act (No. IV of
1950), SS. 10, 11.
Submission of its report by the Advisory Board under
s. 10 of the Preventive Detention Act within the time prescribed by that section is of the utmost importance to the
detenu and if the Board fails to do so any further detention beyond that period becomes unlawful.
Consequently, where the case of the detenu was tbat
the.Advisory Board had not submitted its report within ten
weeks of his detention and his detention thereafter had,
therefore, become illegal and no attempt was made on
behalf of the Government to controvert that case in the
counter-affidavits filed on its behalf, the detenu must be
set at liberty.
ORIGINAL JURISDICTION : Petition No. 135 of 1957
(Under Article 32 of the Constitution for a writ in
the nature of habeas corpus).