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Hanwant Rai vs Chandi Prasad And Ors.

High Court Of Judicature at Allahabad|31 January, 1929


1. This is an appeal by one who was arrayed as defendant 1 in the original suit. The suit arose under the following circumstances: The appellant Hanwant Rai sold, on 12th February 1912, a certain amount of property to Mulai and two others for the sum of Rs. 9,000. Kauleshar Rai, who has since died, brought a suit for preemption on 7th September 1912 and obtained a decree, on condition of payment of the entire consideration of the money of Rs. 9,000, on 25th January 1913. He deposited the money that he was required to do under the decree and obtained delivery of possession. The appeal to the High Court was dismissed. Kauleshar and his joint brothers who are plaintiffs 3 and 4 in this action, sold a half share in the property pre-empted to the plaintiffs 1 and 2 of the suit and three others, on 6th August 1916. The sons of Hanwant Rai challenged the sale made by their father, by suit No. 79 of 1919, and, eventually, got a decree for possession from the Court of first instance and also by the Court of appeal. The decree directed that on condition of payment of Rs. 2761/8, the plaintiffs, namely, the sons of Hanwant Rai, would be entitled to recover possession. They deposited the money and obtained delivery of possession on 12th March 1921.
2. Having thus been dispossessed of their property the present suit was instituted by the brothers and survivors of Kauleshar Rai and two of the five transferees. It has been found that defendant 1, one of each transferees, has a small interest in the property mortgaged and that the other transferees, never having paid anything towards the sale consideration, did not obtain any interest in the property. The present suit was directed for the recovery of several sums of money, viz., Rs. 6238/8, being the difference between the entire purchase money paid, viz., Rs. 9,000 and the sum. of Rs. 2761/8 paid by the sons as a condition precedent to their recovery of the property, for recovery of Rs. 1,400, being the costs incurred by the plaintiffs in defending the sons' suit, Rs. 556/8 being the costs paid by the plaintiffs to the sons under the decrees obtained by them and Rs. 4336/14/6, interest on the sale consideration and other sums claimed. The suit has been decreed in its entirety except for the sum of Rs. 1,400 which represented the amount of costs incurred by the plaintiffs in defending the sons' suit. The plaintiffs have not appealed? and as we have said, the present appeal is by Hanwant Rai alone. Two points have been urged before us, namely, (1) the pre-emptor's vendees are not entitled to the benefit of the indemnity clause in the sale-deed executed by Hanwant Rai in favour of Mulai and others, and (2), the suit was barred by limitation.
3. We shall take up the first point first. The original sale-deed, namely the one executed by Hanwant in favour of Mulai and others will be found printed at p. 23 of the record. By this sale-deed, Hanwant Rai expressly agreed to indemnify the vendees in case by any act of himself or by any claim of his children or the members of his family, any defect arose in the property. It is conceded that Kauleshar Rai, having succeeded in this suit for pre-emption we substituted for the original vendees, as the vendee. That this was the position of the pre-emptor is fully borne out by the Full Bench case of Gobind Dayal v. Inayat Ullah [1885] 7 All. 775, vide the remarks of Mahmud J., at p. 808. It is clear, therefore, that so far as Kauleshar's surviving brothers are concerned, there can be no doubt that the suit is maintainable on the indemnity clause contained in the sale-deed of 12th February 1912. So far as the vendees are concerned, there are two positions. Either, to them the benefit of the contract was transferred or it was not.
4. If it was not transferred, the benefit of the contract remains entirely in Kauleshar's survivors. If they have lost the entire property which was obtained by pre-emption, they are entitled to recover the damages, irrespective of the fact that they have transferred half the property to other people. If, to the vendees, the rights accruing under the indemnity have been assigned, they too are entitled to maintain the suit. Further it appears that under Section 55, Sub-section 2, T.P. Act, there is always an implied covenant as to title and this covenant runs with the land. If that be the case with respect to an implied contract, it seems to follow that an express contract of this nature must also run with the land. In any case, the vendees from Kauleshar Rai and his brothers are entitled to take the benefit of the implied contract contained in Section 55, Sub-section 2, T.P. Act. In any view of the case, it is impossible to maintain on behalf of defendant 1 that the suit is not maintainable by the vendees of Kauleshar Rai and his brothers.
5. We now come to the question of limitation. It is argued on behalf of Hanwant Rai that either Article 62 or Article 97, Lim. Act applies, and as the suit was brought more than three years after delivery of possession to the sons of Hanwant Rai, the suit is barred by time. Reliance has been placed on several cases and mainly on the case of Kundan Lal v. Bisheshar Dayal A.I.R. 1927 All. 734. This was a decision of a Bench of two learned Judges of this Court and the learned Judges thought that they had to choose between two cases decided in this Court. Those two cases were Mul Kunwar v. Chittar Singh [1908] 30 All. 402 and Janak Singh v. Walidad Khan [1915] 13 A.L.J. 669. In the case in Mul Kunwar v. Chittar Singh [1908] 30 All. 402 it was expressly decided that in the circumstances of the present case, Article 116 Lim. Act applied. In the latter case in Janak Singh v. Walidad Khan [1915] 13 A.L.J. 669, Article 116 was not applied on the express ground that there was no covenant to which Article 116 could be applied. Their Lordships analyzed the document before them and expressly found that there were no covenants to which Article 116 could apply. The earlier case of Mul, Kunwar v. Chittar Singh [1908] 30 All. 402, was not brought to the notice of the learned Judges. It was not necessary to do so. Their Lordships appear to have been fully alive to the contents of Article 116, Lim. Act, but, as we have said, they expressly said that in the circumstances of that case there was nothing in the sale-deed to which Article 116 could be applied. In the case under discussion in Kundan Lal v. Bisheshar Dayal A.I.R. 1927 All. 734, one Calcutta case and a Madras case were also cited, but they were not discussed. In view of the fact that the case in Kundan Lal v. Bisheshar Dayal A.I.R. 1927 All. 734, preferred to follow one of the cases to another of the cases decided in this Court, we think we are at liberty to accept the case in Mul Kunwar v. Chittar Singh [1908] 30 All. 402, also a Bench decision as a proper guide for us.
6. Considering the case apart from authority there can be little doubt that Article 116 Lim. Act would be applicable. We shall presently show that article has been applied not only in this Court, in the case of Mul Kumar v. Chittar Singh [1908] 30 All. 402 but by several other High Courts in India and also by the Privy Council. Article 116 runs as follows:
Suit for compensation for the breach of a contract in writing registered. Period of limitation-six years. Time from which period runs-when period of limitation would begin to run against a suit brought on a similar contract not registered.
7. The contract in writing registered is that, in case the vendees lost the whole or any portion of the property on account of the claim made by the children of the vendor, they would be entitled to be indemnified. This is an express contract of indemnity. The cause of action would arise from the date of dispossession, a date which is within six years of the suit. Apart from authority, therefore, there can be no difficulty in the application of Article 116 Even if it had been the case that there was no express covenant, the implied covenant mentioned in Section 55, T.P. Act, would be applicable. The fact that the implied contract is not put into the document itself will not make any difference. A contract may be express or implied: see Section 9, Contract Act. In Article 116, Lim. Act, the word used is "contract." This should include an implied contract also. We have to mention this aspect of the case because we have said that if the vendees from Kauleshar Rai and his brothers could not succeed on the express contract contained in the sale-deed of 1912, they were entitled to succeed on the implied covenant which runs with the land.
8. In Nabin Chandra Ganguly v. Munshi Mander(A.I.R. 1927 Patna 248) it was held that the implied contract mentioned in Section 108, T.P. Act (the case was of a lease) could be read within Article 116, Lim. Act and a suit for compensation for breach of the covenant would be governed by the six years' rule of limitation. The same view was taken in Sigamani Pandithan v. Munibadra Nainar (A.I.R. 1926 Madras 255) following earlier Madras cases. The same view was taken in Ganapa Putta Hegde v. Hammad Saiba A.I.R. 1925 Bom. 410 and in Injad Ali v. Mohini Chandra A.I.R. 1924 Cal. 148. In the case of Tricomdas Cooverji Bhoja v. Gopi Nath Jiu Thakur A.I.R. 1916 P.C. 182, the question arose whether where rent was payable under a registered document the Article 110 which applied expressly to a suit for recovery of arrears of rent applied or Article 116 with the larger period of limitation. Their Lordships of the Privy Council held that Article 116 applied to all cases in which the contract was in writing registered, although such cases may have been provided for in the earlier portion of Sch. 1, Lim. Act. This makes it entirely clear that a suit for compensation for breach of a contract that is in writing registered, must be brought within Article 116. We are entirely satisfied both on principle and on authority that the suit is within time. The result is that the appeal fails and is hereby dismissed with costs.
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Hanwant Rai vs Chandi Prasad And Ors.


High Court Of Judicature at Allahabad

31 January, 1929