# Hemanta Kumari Devi v. Midnapitr Zamindari Co., Ltd

- **Citation:** [1959] Supp. 2 S.C.R. 107
- **Court:** Supreme Court of India
- **Decided:** 1959
- **Bench:** P. B. Gajendragadkar, M. Hidaya'.1.'Ullah
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/hemanta-kumari-devi-v-midnapitr-zamindari-co-ltd-1586
- **Pages:** 16

## Headnote

Registration-Contract to lease-Agreement not creating a present and immediate demise-Whether requires registration-" Agreement to lease ", Meaning of-Indian Registration Act, I90/i (I6 of
I908), S. 2(7).
A document purporting to be a receipt and bearing a four
anna revenue stamp was executed by Min favour of the respondent and recited, inter alia, as follows:
" I have this day given
I959
January :JI.
108
SUPREME COURT REPORTS [1959] Supp.
r959
to you the land described below which is owned by me.
Now
you have become occupancy tenant of the same.
You may
Tirttvenibai
enjoy the same in any w·ay you like from generation to genera-
& Anoth"
tion.
My estate and heirs or myself shall have absolutely no
v.
right thereto. You shall become the owner of the said land
Smt. Lilabai
from date r-6-4+ I will have absolutely no right thereto after
the said date ......... The estate ...... has been given to you in lieu
of your Rs. 8,700 due to you, subject to the condition that iii
case your amount has not been paid to you on date 1-6-44, you
may fully enjoy the estate .... in any way you like from generation
to generation." The respondent instituted a. suit against M for
the specific performance of a contract to lease alleging that
under the document he had contracted to lease to her in perpetuity in occupancy right his lands in consideration of the debt
of Rs. 8,700 and as the amount was not paid within the due
date, he was liable to perform and give effect to the said contract.
M contended, inter alia, that the document was an
agreement to lease under s. 2(7) of the Indian Registration
Act, r908, and that as it was not registered it was inadmissible
in evidence.
·
Held, that an agreement to lease under s. 2(7) of the Registration Act, 1908, must be a document which effects an actual
demise and operates as a lease.
An agreement between t\vo
parties which entitles one of them merely to claim the execution of a lease from the other without creating a present and
in1mediate demise in his favour is not an agreement to lease
within the meaning of s. 2(7) of the Act.
Held, further, that on a construction of the document in
question, it \Vas not intended to, and did not, effect an actual or
present demise in favour of the respondent and consequently it
was not an agreement to lease under s. 2(7) of the Act.
Accordingly, the document did not require registration and was admissible in evidence.
Hemanta Kumari Devi v. Midnapitr Zamindari Co., Ltd.,
(1919) L.R, 46 I.A. 240, relied on.
Panchanan Bose v. Chandra Charan Misra, (r9IO) I.L.R. 37
Cal. 808, approved.
Narayanan Chetty v. Muthia Servai, (1912) I.LR. 35 Mad. 63,
Purmananddas ]iwandas v. Dharsey Kirji, (r886) I.L.R. IO Born.
IOI, Balram v. Mahadeo, I.L.R. 1949 Nag. 849 and Poole v. Bently,
(r8IO) 12 East. r68; I04 E.R. 66, distinguished.
CIVIL APPELLATE
Jumsm.cTION:
Civil
Appeal
No. 239 of 1955.
Appeal from the Judgment and Decree dated the
30th November, 1953, of the former Nagpur High
Court in First Appeal No. 118 of 1947, arising out of
the Judgment and Decree dated the 12th August,
(2) S.C.R.
SUPREME COURT REPORTS
109
194 7, of the Court of the Additional District Judge,
1 959
Wardha, in Civil Suit No. 9-A of 1946.
T iruvenibai
M. 0. Setalvad, Attorney-General for India, J. B.
& Another
Dadachanji, S. N. Andley and Rameshwar Nath, for
v.
the appellants.
Smt. Lilabai
M. Adhikari, Advocate-General for the State of Madhya
Pradesh and I. N. Shroff, for the respondent.
1959. January 21.
The Judgment of the Court
was delivered by
GAJENDRAGADKAR, J.-This is an appeal by the Gajendragadkar J.
widow, and the minor son of Mangilal, defendant 1,
and it has been filed with a certificate by the High
Court of Judicature at Nagpur. It arises out of a suit
filed by the respondent Shrimati Lilabai w/o Vrijpalji,
for the specific performance of a contract to lease or
in the alternative for damages and for a declaration
against defendant 2, the daughter of defendant 1 that
she has no right, title or interest i

## Text

(2) S.C.R.
SUPREME COURT REPORTS
107
in the circumstances of the present cases, be held to
I959
have caused prejudice to him. We must accordingly
hold that the continuation of the trial of the three
Gopi Chand
v.
cases against the appellant according to the summons
The Delhi
procedure subsequent to October I, 1950, has vitiated Administration
the trial and has rendered the final orders of convic-
, tion and sentence invalid. We must accordingly setGajendragadkar J.
aside the orders of conviction and sentence passed
against the app~llant in all the three cases.
That takes us to the question as to the final order
which should be passed in the present appeals. The
offences with which the appellant stands charged are
of a very serious nature; and though it is true that
he has had to undergo the ordeal of a trial and has
suffered rigorous imprisonment for some time that
would not justify his prayer: that we should not order
his retrial. In our opinion, having regard to the
gravity of the offences charged against the appellant,
the ends of justice require that we should direct that
he should be tried for the said offences de novo according to law.
We also direct that the proceedings to be
taken against the appellant hereafter should be commenced without delay and should be disposed of as
expeditiously as possible.
Appeal allowed.
Retrial ordered.
TIRUVENIBAI & ANOTHER
1).
SMT. LILABAI
(P. B. GAJENDRAGADKAR and M. HIDAYA'.1.'ULLAH, JJ.)
Registration-Contract to lease-Agreement not creating a present and immediate demise-Whether requires registration-" Agreement to lease ", Meaning of-Indian Registration Act, I90/i (I6 of
I908), S. 2(7).
A document purporting to be a receipt and bearing a four
anna revenue stamp was executed by Min favour of the respondent and recited, inter alia, as follows:
" I have this day given
I959
January :JI.
108
SUPREME COURT REPORTS [1959] Supp.
r959
to you the land described below which is owned by me.
Now
you have become occupancy tenant of the same.
You may
Tirttvenibai
enjoy the same in any w·ay you like from generation to genera-
& Anoth"
tion.
My estate and heirs or myself shall have absolutely no
v.
right thereto. You shall become the owner of the said land
Smt. Lilabai
from date r-6-4+ I will have absolutely no right thereto after
the said date ......... The estate ...... has been given to you in lieu
of your Rs. 8,700 due to you, subject to the condition that iii
case your amount has not been paid to you on date 1-6-44, you
may fully enjoy the estate .... in any way you like from generation
to generation." The respondent instituted a. suit against M for
the specific performance of a contract to lease alleging that
under the document he had contracted to lease to her in perpetuity in occupancy right his lands in consideration of the debt
of Rs. 8,700 and as the amount was not paid within the due
date, he was liable to perform and give effect to the said contract.
M contended, inter alia, that the document was an
agreement to lease under s. 2(7) of the Indian Registration
Act, r908, and that as it was not registered it was inadmissible
in evidence.
·
Held, that an agreement to lease under s. 2(7) of the Registration Act, 1908, must be a document which effects an actual
demise and operates as a lease.
An agreement between t\vo
parties which entitles one of them merely to claim the execution of a lease from the other without creating a present and
in1mediate demise in his favour is not an agreement to lease
within the meaning of s. 2(7) of the Act.
Held, further, that on a construction of the document in
question, it \Vas not intended to, and did not, effect an actual or
present demise in favour of the respondent and consequently it
was not an agreement to lease under s. 2(7) of the Act.
Accordingly, the document did not require registration and was admissible in evidence.
Hemanta Kumari Devi v. Midnapitr Zamindari Co., Ltd.,
(1919) L.R, 46 I.A. 240, relied on.
Panchanan Bose v. Chandra Charan Misra, (r9IO) I.L.R. 37
Cal. 808, approved.
Narayanan Chetty v. Muthia Servai, (1912) I.LR. 35 Mad. 63,
Purmananddas ]iwandas v. Dharsey Kirji, (r886) I.L.R. IO Born.
IOI, Balram v. Mahadeo, I.L.R. 1949 Nag. 849 and Poole v. Bently,
(r8IO) 12 East. r68; I04 E.R. 66, distinguished.
CIVIL APPELLATE
Jumsm.cTION:
Civil
Appeal
No. 239 of 1955.
Appeal from the Judgment and Decree dated the
30th November, 1953, of the former Nagpur High
Court in First Appeal No. 118 of 1947, arising out of
the Judgment and Decree dated the 12th August,
(2) S.C.R.
SUPREME COURT REPORTS
109
194 7, of the Court of the Additional District Judge,
1 959
Wardha, in Civil Suit No. 9-A of 1946.
T iruvenibai
M. 0. Setalvad, Attorney-General for India, J. B.
& Another
Dadachanji, S. N. Andley and Rameshwar Nath, for
v.
the appellants.
Smt. Lilabai
M. Adhikari, Advocate-General for the State of Madhya
Pradesh and I. N. Shroff, for the respondent.
1959. January 21.
The Judgment of the Court
was delivered by
GAJENDRAGADKAR, J.-This is an appeal by the Gajendragadkar J.
widow, and the minor son of Mangilal, defendant 1,
and it has been filed with a certificate by the High
Court of Judicature at Nagpur. It arises out of a suit
filed by the respondent Shrimati Lilabai w/o Vrijpalji,
for the specific performance of a contract to lease or
in the alternative for damages and for a declaration
against defendant 2, the daughter of defendant 1 that
she has no right, title or interest in the property in
suit. The respondent's case was that defendant 1 had
executed an instrument (Ex. P-1) in favour of the respondent by which he had contracted to lease to her
in perpetuity in occupany right his four khudkasht
lands admeasuring 95·19 acres situated in Mouza
Mohammadpur in consideration of the debt of Rs.
8,700.
According to the respondent the instrument
had provided that, if defendant 1 did not repay to her
the said debt on June 1, 1944, the said contract of
lease would be operative on and from that date. Defendant 1 did not repay the loan by the stipulated date
and so he became liable to perform and give effect to
the said contract of lease on June l, 1944. The respondent repeatedly called upon defendant 1 to perform
the said contract, but defendant 1 paid no heed to her
demands and so she had to file the present suit for
specific performance. The respondent had been and
was still ready and willing to specifically perform the
agreement and to accept a deed of lease for the lands
in question in lieu of the said debt of Rs. 8, 700. Defendant 1, however, had been ·guilty of gross and unreasonable delay in performing his part of the contract and that had caused the respondent the loss of
110
SUPREME COURT REPORTS [1959] Supp.
'959
the benefit of the lease and consequent damage. On
Tfruvenibai
these allegations the respondent claimed specific per-
& Another
formance of the contract and an amount of Rs. 2,340
v.
as compensation or in the alternative damages
Smt. Lilabai
amounting to Rs. 11,080.
G . d
dk
1
To this suit Mst. Durgabai, the daughter of defena;en raga
ar
. d
d b
.
ant I ha
een 1mpleaded as defendant 2 on the
ground that she was setting up her own title in respect
of the lands in suit and a declaration was claimed
against her that she had no right, title or interest in
the said lands. Defendant 2 filed a written statement
contesting the respondent's claim for a declaration
against her but she did not appear at the trial which
proceeded ex parte against her. In the result defendant 1 was the only contesting defendant in the proceedings.
·
Several pleas were raised by defendant 1 against
the respondent's claim. He denied the receipt of the
consideration alleged by her and he pleaded that the
document (Ex. P-1) was a bogus, sham and collusive
document which had been brought into existence for
the purpose of shielding his property from his creditors and it was not intended to be acted upon. It was
also urged by him that the said document, if held to
be genuine, was an agreement to lease under s. 2(7) of
the· Indian Registration Act, and since it was not
registered it was inadmissible in evidence.
The learned trial judge framed appropriate issues
on these pleadings and found against defendant I on
all of them. Accordingly a decree was passed ordering defendant 1 to execute a lease-deed in respect of
the fields mentioned in the plaint on a proper stamp
paper in occupancy right in favour of the respondent
and to put her in possession of them.
A decree for
the payment of Rs. 2,316 by way of compensation
was also passed against him. The declaration claimed by respondent against defendant 2 was likewise granted.
This decree was challenged by defendant I by his
appeal before the High Court of Judicature at Nagpur. Pending the appeal defendant 1 died and his
widow and his minor son came on the record as his
(2) S.C.R.
SUPREME COURT REPORTS
111
legal representatives and prosecuted the said appeal.
r959
The High Court held that the document was supportTiruvenibai
ed by consideration, that it was not an agreement to
& Another
lease under s. 2(7) of the Indian Registration Act and
v.
therefore it did not require registration and was
snit. Lilabai
admissible in evidence. In the result the decree pass-
-
ed by the trial court was confirmed and defendant l's Gajendragadkar J.
appeal was dismissed.
The present appellants then applied to the High
Court for leave to appeal to this Court and the High
Court granted leave because it held that the basic
question involved in the decision of the appeal was
the legal effect of Ex. P-1 and that the construction
of a document of title is generally regarded as a substantial question of law. It 1s with this certificate
that the present appeal has come before this Court,
and it raises two questions for our decision : Is the
document (Ex. P-1) an agreement to lease under
s. 2(7): If not, does it require registration under s. 17
of the said Act? All other issues which arose between
the parties in the courts below are concluded by concurrent findings and they have not been raised before
us.
Before dealing with these points, we must first consider what the expression "an agreement to lease"
means under s. 2(7) of the Indian Registration Act,
hereinafter referred to as the Act. Section 2(7) provides that a. lease includes a counterpart, kabuliyat, an
undertaking to cultivate and occupy and an agreement to lease. In H emanta K umari Debi v. M idnapur
Zamindari Go. Ltd. (1) the Privy Council has held that
"an agreement to lease, which a lease is by the statute declared to include, must be a document which
effects an actual demise and operates as a lease". In
other words, an agreement between two parties
which entitles one of them merely to claim the
execution of a lease from the other without creating a present and immediate demise in his favour is
not included under s. 2, sub-s. (7). In Hemanta Kumari
Debi's case (1) a petition setting out the terms of an
agreement in compromise of a suit stated as one of the
(1) (1919) L. R. 46 I. A. 240.
112
SUPREME COURT REPORTS (1959] Supp.
'959
terms that the plaintiff agreed that if she succeeded
in another suit which she had brought to recover
ffruvenibai
certain land, other than that to whicl:t the com:
& Another
v.
promised suit related, she would grant to the defensmi. Lilabai
dants a lease of that land upon specified terms. The
petition was recited in full in the decree made in
Gajendragadkar hthe compromised suit under s. 375 of the Code of.
Civil Procedure, 1882.
A subsequent suit was brought for specific performance of the said agreement
and it was resisted on the ground that the agreement
in question was an agreement to lease under s. 2(7)
and since it was not registered it was inadmissible in
evidence. This plea was rejected by the Privy Council
on the ground that the document did not effect an
actual demise and was outside the provisions of s. 2(7).
In coming to the conclusion that the agreement to
lease under the said section must be a document
which effects an actual demise the Privy Council has
expressly approved the observations made by Jenkins, C. J., in the case of Panchanan Bose v. Chandra
Charan Misra (1) in regard to the construction of s. 17
of the Act. The document with which the Privy
Council was concerned was construed by it as" an
agreement tha.t, upon the happening of a contingent
event at a date which was indeterminate and, having
regard to the slow progress of Indian litigation, might
be far distant, a lease would be granted "; and it was
held that" until the happening of that event, it was
impossible to determine whether there would be any
lease or not ". This decision makes it clear that the
meaning of the expression " an agreement to lease"
"which, in the context where it occurs and in the
statute in which it is found, must relate to some document that creates a present and immediate interest in
the land". Ever since this decision was pronounced
by the Privy Council the expression " agreement to
lease " has been consistently construed by all the
Indian High Courts as an agreement which creates an
immediate and a present demise in the property
covered by it.
It would be relevant now to refer to the observations
(1) (1910) I.L.R. 37 Cal. 808.
(2) S.C.R.
SUPREME COURT REPORTS
113
of Jenkins, C. J., in the case of Panchanan Bose (1).
r959
In that case, a solehnama by which no immediate
Tiruvenibai
interest in immoveable property was created was
& Another
held not to amount to a lease within the meaning
v.
of cl. (d) of s. 17 of the Act but merely an agreement
Smt. Litabai
to create a lease on a future day. "Such a docu-
.
-
ment ", it was observed, " fell within cl. (h) of s. 17 and Ga;endragadkar I·
as such was admissible in evidence without registration".
Jenkins, C. J., held that "on a fair reading of
the document, no immediate interest was created, there
was no present demise, and the document was merely
an agreement to create a lease on a future day, the
terms of which were to be defined by documents to be
thereafter executed ". " This being so ",said the learned
C. J., " I think the appellants have rightly contended
before us that the document was admissible in evidence as it falls within cl. (h) of s. 17 of the Indian
Registration Act". This decision would show that an
agreement which creates no immediate or present
demise was not deemed to be a lease under s. 2(7) and
so it was held to fall within s. l 7(h) of the Act and
this view has been specifically affirmed by the Privy
Council in Hemanta K umari Debi's case (2).
It is true that in Narayanan Ohetty v. Muthiah
Servai (3) a Full Bench of the Madras High Court had
held that an agreement to execute a sub-lease and to
get it registered at a future date was a lease within
s. 3 of the Indian Registration Act of 1877 (III of 1877)
and was compulsorily registrable under cl. (d) of s. 17.
Such an agreement to grant a lease which requires
registration, it was held, affects immoveable property
and cannot be received in evidence in a suit for specific
performance of an agreement. The question which
was referred to the Full Bench apparently assumed
that the agreement in question required registration
and the point on which the decision of the Full Bench
was sought for was whether such an agreement can be
received in evidence in a suit for specific performance
(1) where possession is given in pursuance of an agreement, and (2) where it is not; and the Full Bench
(r) fr9ro] I.L.R. 37 Cal .808.
(2) [1919] L.R. 46 I.A. 240.
(3) (1912) I.L.R. 35 Mad. 63.
15
114
'SUPREME COURT REPORTS [1959] Supp.
'959
answered this question in the negative. "An agreement to lease", it was observed in the J
0 udgment of the
Tiruvenibai
.., Another
Full Bench, " is expressly included in the definition of
v.
the lease in the Registration Act while it cannot be
Smt. Lilabai
suggested that an agreement to sell falls within any
-
definition of sale". It is clear that the question about
Gajendrngadkar J. the construction of thn words " agreement to lease "
was not specifically argued before the Full Bench, and
the main point considered was the effect of the provisions of s. 49 of the Act. In that connection the
argument had centred round the effect of the provisions of cl. (h) of s. 17 of the Registration Act and s. 54
of the Transfer of Property Act. The Full Bench took
the view that in enacting s. 49 of the Act the Legislature meant to indicate that the instrument should
not be received in evidence even where the transaction
sought to be proved did not amount to a transfer of
interest in immoveable property but only created an
obligation to transfer the property. A contract to sell
immovable property in writing, though it may affect
the property without passing an interest in it, is
exempted from registration by clause (h) (now cl. 2 (v))
of section 17 but an agreement in writing to let, falling
within cl. (d) of s. 17, is not. That is why,. according
to the Full Bench, such an agreement cannot be
received in evidence of the transaction which affects
the immovable property comprised therein. Thus
this decision does not directly or materially assist
us in construing the expression "agreement to lease".
Besides, the said decision has not been followed by
the Madras High Court in Swaminatha Mudaliar v.
Ramaswami Mudaliar(') on the ground that it can no
longer be regarded as good law in view of the decision
of the Privy Council in Hemanta Kumari Debi's
case('), and, as we have already pointed out, all the
other High Courts in India have consistently followed
the said Privy Council decision.
The learned Attorney-General has, however, contended before us that the correctness of the decision
of the Privy Council in Hemanta Kumari Debi's
case(') is· open to doubt and he has suggested that we
(r) (I92I) l.L.R. 44 Mad. 399·
(2) (I9I9) L.R 46 I A. 240.
•
(2) S.C.R. SUPREME COURT REPORTS
115
should re-examine the point on the merits afresh. We
1959
do not think there is any substance in this contention
Tiruvenibai
because, if we may say so with respect, the view taken
& Another
by the Privy Council in the said case is perfectly right.
v.
Section 17(1) of the Act deals with documents of which
Smt. Lilabai
registration is . compulsory. It is obvious that the Ga 'endra adkar J.
documents fallmg under els. (a), (b), (c) and (e) of
1
g
sub-s. (1) are all documents which create an immediate
and present demise in immovable properties mentioned
therein. The learned Attorney-General's argument is
that cl. (d) which deals with leases does not import
any such limitation because it refers to leases of
immoveable properties from year to year or any term
exceeding one year or reserving a yearly rent; and the
Act deliberately gives an in"tllusive definition of the
term 'lease ' in s. 2(7).
This argument, however, fails
to take into account the relevant provisions of the
Transfer of Property Act.
Section 4 of the said Act
provides that s. 54, paragraphs 2 and 3, 59, 107 and
123 shall be read as supplemental to the Indian
Registration Act, 1908. Section 107 is material for
our purpose. Under this section a lease of immoveable property from year to year or for any term
exceeding one year or reserving a yearly rent can be
made only under a registered instrument. This section
also lays down that where a lease of immoveable property is made by a registered instrument, such instrument, or, where there are more instruments than one,
each instrument, shall be executed by both the lessor
and the lessee. It would be noticed that if s. 107 has
to be read as supplemental to the Act, the definition of
the word 'lease ' prescribed by s. 105 would inevitably
become relevant and material; and there is no doubt
that under s. 105 a lease of immoveable property is a
transfer of right to enjoy such property made in the
manner specified in the said section. Therefore, it
would not be right to assume that leases mentioned in
cl. (d) of s. 17, sub-s. (1), would cover cases of documents which do not involve a present and immediate
transfer ofleasehold rights. It would thus be reasonable to hold that, like the instruments mentioned in
els. (a), (b) and (c) of s. 17(1), leases also are instruments
116
SUPREME COUR'.l' REPORTS [1959] Supp.
'959
which transfer leasehold
rights in the property
immediately and inpresenti. VVe have already referred
Tiruvenibai
& Anoth"
to the requirement of s. 107 of the Transfer of Prov.
perty Act that a lease must be executed both by the
Smt. Lilabai
lessor and the lessee. It may be pertinent to point out
-
that an instrument signed by the lessor alone which
Gajendrngadka. J. may not be a lease under s. 107 may operate as an
agreement to lease under s. 2(7) of the Act.
The legislative history of the provisions of s. l 7(2)(v}
may perhaps be of some assistance in this connection.
Section l 7(h) of Act III of 1877 which :corresponds to
the present s. 17(2) (v) did not appear in the earlier
Registration Acts of 1864, 1866 and 1871. Its introduction in Act III of 1877 became necessary as a result
of the decision of the Privy Council in Fati Chand
Sahu v. Lilarnbar Singh Das (1) in which it was held
that an agreement to sell immoveable property for
Rs. 22,500 coupled with an acknowledgment of the
receipt of Rs. 7,500 and a promise to execute a saledeed on the payment of the balance was compulsorily
registrable under s. 17 of the Act (2).
Section l 7(h)
was therefore enacted in 1877 to make it clear that a
document which does not itself create an interest in
the immoveable property does not require registration
even if .it expressly contemplates and promises the
creation of that interest by a subsequent document;
in other words, contracts of sale and purchase of
which specific performance would be granted under
certain circumstances fall within this provision and
would no longer be governed by the said decision of
the Privy Council in the case of Fati Chand Sahu v.
Lilarnbar Singh Das (1 ).
Thus the policy of the Legislature clearly is to exclude from the application of
els. (b) and (c) of s. 17(1) agreements of the said
character. On principle, there is-no difference between
such agreements of sale or purchase and agreements
to lease.
Under both classes of documents no present
or immediate demise is made though both of them
may lead to a successful claim for a specific performance. That is why the Privy Council observed in the
(1) (1871) 9 Bcng. LR. 433; 14 M.I.A. 129.
(2) Act XX of 1866.
•
(2) S.C.R.
SUPREME COURT REPORTS
117
case of Hemanta Kumari Debi (1) that the context and
I959
the scheme of the statute justified the view taken by
Tiruvenibai
Jenkins, C. J., in the case of Panchanan Bose (2).
& Another
It may also be relevant to bear in mind that the
v:
other documents which are included within the word
Smt. Lilabai
' lease ' by s. 2(7) of the Act support the same conclu-
.
-
sion.
A counterpart, as it is usually understood, is a Ga;endragadkar J.
writing by which a tenant agrees to pay a specified
rent for the property let to him and signed by him
alone. It is thus in the nature of a counterpart of a
lease and as such it is included within the meaning of
the word ' lease' under s. 2(7). Same is the position
of a kabuliyat and an undertaking to cultivate or
occupy.
In other words, it is clear that all the four
instruments which, under the inclusive definition of
s. 2(7), are treated as leases satisfy the test of immediate and present demise in respect of the immoveable
property covered by them. We must, therefore, hold
that the expression " an agreement; to lease " covers
only such agreements as create a present demise.
Let us now proceed to deal with the question as to
whether the document (Ex. P-1) constitutes" an agreement to lease ". It purports to be a receipt executed
in favour of the respondent by defendant 1 and bears
a four anna revenue stamp. "I have this day given
to you", says the document, "the land described
below which is owned by me.
Now you have become
occupancy tenant of the same. You may enjoy the
same in any way you like from generation to generation.
My estate and heirs or myself shall have absolutely no right thereto. You shall become the owner
of the said land from date 1-6-1944.
I will ha.ve
absolutely no right thereto after the said date". Then
the document proceeds to mention tbe properties and
describes them in detail, and it adds " all the above
fields are situate at Mouza Mohammadpur, mouza
No. 312, tahsil Arvi, district Wardha. The estate
described above has been given to you in lieu of your
Rs. 8,700 due to you, subject to the condition that in
case your amount has not been paid to you on date
1-6-1944, you may fully enjoy the estate described
(1) (1919) L.R. 46 I.A. 240.
(2) (1910) I.L.R. 37 Cal. 808.
I959
Tiruvenibai
& Another
v.
Smt. Lilabai
GaJendragadkar
llS
SUPREME COURT REPORTS [1959] Supp.
,
above in any way you like from generation to generation". The question for our decision is: Does this
document amount to an agreement to lease uuder
s. 2(7) of the. Act ?
In construing this document it is necessary to remember that it has been executed by laymen without
1 ·legal assistance, and so it must be liberally construed
without recourse to technical considerations. The
heading of the document,. though relevant, would not
determine its character. It is true that an agreement
would operate as a present demise although its terms
may commence at a future date. Similarly it may
amount to a present demise even though parties may
contemplate to execute a more formal document iu
future. In considering the effect of the document we
must enquire whether it contains unqualified and unconditional words of present demise and includes the
essential terms of a lease.
Generally if rent is made
payable under an agreement from the date of its
execution or other specified date, it may be said to
create a present demise.
Another relevant test is the
intention to deliver possession. If possession is given
under an agreement and other terms of tenancy have
been set out, then the agreement can be taken to .be
an agreement to lease. As in the construction of
other documents, so in the construction of an agreement to lease, regard must be had to all the relevant
and material terms; and an attempt must qe made to
reconcile the relevant terms if possible and not to
treat any of them as idle surplusage.
The learned Attorney-General contends that this
document is not a contingent· grant of lease at all.
According to him it evidences a grant of lease subject
to a condition and that shows that a present demise fo
intended by the parties. He naturally relies upon tho
opening recitals of the document.
According to him,
when the document says th~t defendant I has given
to the respondent the land described below and that
the respondent has become occupancy tenant of the
same, it amounts to a clear term of present demise. A
similar recital is repeated in the latter part of the
document where it is stated that the estate described
(2) S.C.R. SUPREME COURT REPORTS
119
I959
above has· been given to the respondent in lieu of
Rs. 8,700 due to her. In our opinion, it would be unTiruvenibai
reasonable to construe these recitals by themselves,
& Another
a.part from the other recitals in the document.
We
v.
cannot lose sight of the fact that the document exSmt. Lilabai
pressly states that the respondent shall become the
-
owner of the laud from 1-6-1944 and that defendant 1 Gajendragadkar f.
would have no title over it after that date. This
recital also is repeated in the latter part of the document ; and it makes the intention of the parties clear
that it is only if the amount of debt is not repaid by
defendant 1 on the date specified that the agreement
was to come into force.
In other words, reading the
document as a whole it would be difficult to spell out
a present or immediate demise of the occupancy rights
in favour of the respondent. In this connection the
fact that the document is described as a receipt may
to some extent be relevant. It is clear that by executing this document the defendant wanted to comply
with the respondent's request for acknowledging the
receipt of the amount coupled with .the promise that
the amount would be repaid on 1-6-1944. The defendant also wanted to comply with the respondent's
demand that, if the amount was not repaid on the
said date, he would convey the occupancy rights in
his lands to her. Besides, it is significant that the
document does not refer to the payment of rent and
does not contemplate the delivery of possession until
1-6-1944. If the document had intended to convey
immediately the occupancy rights to the respondent it
would undoubtedly have referred to the delivery of
possession and specified the rate at which, and the
date from which, the rent had to be paid to her.
The
stamp purchased for the execution of the document
also incidentally shows that the document was intended to be a receipt and nothing more.
Under s. 2 of
the Central Provinces Land Revenue Act, 1917 (C. P.
II of 1917) an agricultural year commences on the
first day of June and it is from this date that the
agreement would have taken effect if defendant 1 had
not repaid the debt by then. It is clear that the
respondent was not intended to be treated as an
•
120
SUPREME COURT REPORTS [1959] Supp.
occupancy tenant between the date of the document
and June I, 1944.
During that period the agreement
Tfruvenibai
did not come into operation at all. In other words, it is
& Another
v.
on the contingency of defendant's failure to repay the
r959
snit. Litabai
amount on June I, 1944, that the agreement was to
take effect. We have carefully considered the material
Gajendrngadkar J. terms of the document and we are satisfied that it was
not intended to, and did not, effect an actual or
present demise in favour of the respondent. In our
opinion, therefore, the High Court was right in holding that the document was not an agreement to lease
under s. 2(7) of the Act and so did not require registration.
•
We would now briefly refer to some of the decisions
on which the learned Attorney-General relied in
support of his construction of the document. In
Purmananddas Jiwandas v. Dharsey
Virji (1), the
agreement between the parties had expressly provided
that the lease in question was to commence from
October l, 1882, though the agreement was executed
seven days later, that the rent was to commence from
that day and the rent then due was to be paid by the
next day. It is in the light of these specific terms
that the Bombay High Court held that the relevant
words in the document operated as an actual demise.
None of these conditions is present in the document
with which we are concerned.
Similarly in Poole v. Bentley ('), by the instrument
in question, Poole had agreed to let unto Bentley,
and Bentley had agreed to take, all that piece of land
described for the term of 61 years at the yearly rent
of£ 120 free and clear of all taxes, the said rent to be
paid quarterly, the first quarter's rent within 15 days
after Michaelmas 1807, and that in consideration of
the lease, Bentley had agreed within the space of four
years to expend and lay out in 5 or more houses of a
third-rate or class of building £ 2000 and Poole had
agreed to grant a lease or leases of the said land and
premises as soon as the said 5 houses were covered in.
In dealing with the construction of this document Lord
(I) (1886) I.L.R. 10 Born. 101.
(2) (1810) 12 East. 168; 104 E.R. 66.
(2) S.C.R.
SUPREME COURT REPORTS
121
Ellenborough, C. J., observed that the rule to be collectx959
ed from the. relevant decisions cited before him was
Tiruvenibai
that the intention of the parties as described by the
&; Another.
words of the instrument must govern the construction
v.
and that the intention of the parties to the document
smt. Lilabai
before him appeared to be that the tenant, who was to
-
have spent so much capital upon the premises within Gajendragadkar J.
the first four years of the term, should have a present
legal interest in the term which was to be binding upon both parties; though, when certidn progress was
made in the building, a more formal lease or leases
might be executed. This decision only shows that if
the intention is to effect a present demise the fact that
a further formal document is contemplated by the
parties would not detract from the said intention. It
would, however, be noticed that the document in that
case contained a stipulation for the payment of the
rent and the tenant was to be let into possession
immediately. This case also does not assist the appellant.
In Satyadhyantirtha Swami v. Raghunath Daji (1)
the contract of lease was contained in two documents
which showed that the lands were being cultivated by
Appaji and Ravji who had signed the first document
and that they were authorised to. continue in occupation of the lands on terms mentioned in the first document. The argument that a part of the agreement
would not come into operation till some years later, it
was held, did not operate to make the document other
than a present demise. It is difficult to appreciate
how ·this decision can assist us in construing the present document.
In Balram v. Mahadeo (2) the Nagpur High Court
was dealing with an instrument which purported to be
a receipt and the terms of which seemed to contemplate the execution of a sale-deed in respect of the ·
properties covered by it. Even so, the material clause
was that "it is agreed to give to you both the above
fields in occupancy rights". It was held that, on a
fair and reasonable construction, the document was
(r) A.I.R. 1926 Born. 384.
16
(2) l.L.R. 1949 Nag. 849.
122
SUPREME COURT REPORTS [1959] Supp.
'959
intended to affect a transfer of the occupancy right in
presenti and was as such an agreement to lease. No
TiYuvenibai
& Anoth!r
doubt, as observed by Bose, J., " on a superficial view
v.
of the document it would not appear to be an agree'
Smt. Lilabai
ment to lease.
But in construing a transaction one
.
-
has to look beneath the verbiage and ascertain what
Ga1endragadkar J. are the real rights which are being transferred. When
that is done, we consider that this document is an
agreement to lease despite the fact that it calls itself a
receipt and speaks throughout of a sale ". It is unnecessary to consider the .merits of the conclusion reached by the Nagpur High Court in this case. It would
be enough to say that the said decision would not
afford any assistance in construing the document before us. Besides it is obvious that in construing documents, the usefulness of the precedents is usually of a
limited character; after all courts have to consider
the material and relevant terms of the document with
which they are concerned ; and it is on a fair and reasonable construction of the said terms that the nature
and character of the transaction evidenced by it has
to be determined. In our opinion, the High Court was
right in holding that the instrument (Ex. P-1) was not
an agreement to lease under s. 2(7) of the Act.
The result is the appeal fails and must be dismissed
with costs.
Appeal dismissed.
,