Case: Delhi Development Authority Vs. Durga Chand Kaushish

precedence over the Sovereigns profit. This Court said (at page 292) there:"It is, we think, well settled that the ordinary rule applicable to grants made by a subject does not apply to grants made by the Sovereign authority; and grants made by the Sovereign are to be construed most favourably for the Sovereign. This general rule, however, is capable of important relaxations in favour of the subject. It is necessary to refer here to such only of those relaxations as have a bearing on the construction of the document before us : thus, if the intention is obvious, a fair and liberal interpretation must be given to the grant to enable it to take effect; and the operative part, if plainly expressed, may take effect notwithstanding qualifications in the recitals. In case where the grant is for valuable consideration, it is construed in favour of the grantee, for the honour of the Sovereign: and where two constructions are possible, one valid and the other void, that which is valid ought to be preferred, for the honour of the Sovereign ought to be more regarded than the Sovereigns profit (see para 670 at p. 315 of Halsburys Laws of England, Vol VII, Section 12, Simonds Edition)."30. We doubt whether a lease granted by the Secretary of State for India even before 1950 could be interpreted today by relying upon any special rule of construction applicable to leases by or on behalf of the British Sovereign. Indian citizens are now governed by the Indian Constitution on matters relating to Sovereignty. It may be that a rule of construction traceable to the prerogatives of the Sovereign, in the feudal age, is no longer applicable in a Democratic Republican State, set up by our Constitution, when dealing with its citizens. There appears to be no just and equitable ground why the State as the lessor grantor, with all its resources and experienced draftsmen and legal advisers and enjoying a practically invincible bargaining position as against a citizen lessee grantee, should enjoy the benefit of some nebulous and unjust rule of construction so as to enable Courts to rewrite its defectively drafted deeds in its favour. We think that it is not the ordinary rule of construction, applicable to grants capable of two constructions, which could be obsolete in this country today, but. it is the reversal of that rule in the case of the grant by the Sovereign a feudal relic which could more aptly be said to be inapplicable here today. And, as we have already pointed out, even that feudal relic was subject to the exception that it could not stand in the way of even-handed justice where the Sovereign had received valuable consideration. The lease before us was for valuable consideration.31. It may be mentioned here that not only was consideration in the form of premium of Rs. 18,154/- received at the time of grant of the lease, but a further sum of Rs. 10,888/- was paid by the lessee to the Delhi Improvement Trust under an agreement to which both President of India and the Improvement Trust were parties as lessors. As already mentioned earlier, this agreement (Ex. P-4), headed a lease agreement, was, in fact, intended for the payment of development and betterment charges for building according to a plan sanctioned by the Improvement Trust. But, the document gives the history of the lease from l931, and in paragraph 6 of the agreement, goes to provide:"In spite of this agreement, the parties hereto shall have the same rights as heretofore under the aforesaid lease dated the 17th September, 1931."32. The plaintiff-respondent had, in paragraph 4 of the plaint, laid the factual foundation for a plea of estoppel also against the defendants who had accepted consideration and an yearly rent at Rs. 365/- per annum without enhancement until after Ex. P-4 was executed in 1955. No mention of any liability to pay enhanced rent is found in the deed of 1955. It was only in June, 1962, that somebody in the appellants office seems to have suddenly thought of taking advantage of the ambiguous proviso on behalf of defendant-appellant so that an enhancement of annual rent from Rs. 365/- to Rs. 730/- with retrospective effect from 1-4-51 was demanded. This amount was paid by the respondent under protest and after a warrant of arrest had been issued against him. As the plaintiff had not relied upon an estoppel even though facts, which may give rise to it, were stated, that question need not be considered by us here.33. The learned counsel for the defendant-appellant had, however, contended that the agreement (Ex. P-4) of 27-5-55 was wrongly used by the Division Bench of the Delhi High Court in interpreting the lease deed of 1931. We do not think that it had really so used it although it had considered the conduct of the defendants in accepting rent on the basis that it was a 90 years lease on a rent of Rs. 365/- per year until after 1955, without mentioning a right of enhancement of rent in the deed of 1955 to be circumstances indicating that the defendants themselves had put an interpretation upon the original lease which the Division Bench accepted as correct by finding out the meaning of the deed of 1931 first. We have not found it necessary to rely upon anything in the agreement of 27-5-55 either for interpreting the terms of the lease of 17-9-31 or as an admission on any question or as providing a basis for an estoppel or as a circumstance supporting our view. As indicated above, we have reached our conclusion, quite apart from the contents of the subsequent agreement or the conduct of the parties, by intepreting the lease deed of 17-9-31 on its own language and terms. We think that, on the language of the lease itself, the interpretation adopted by us is the only one which could give effect and meaning to all its parts read as a whole.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]15. After having considered all the argument advanced on behalf of the defendant appellant, we are quite unconvinced that covenant 9 could apply before the termination of the initial period of 90 years. It is by reading the lease deed as a whole that we find it impossible to concur with a view based upon the decisive effect to be given to a few words in the proviso to covenant 9 torn away from the context of the deed read as a whole. We think that covenant No. 9 operates only at the end of the term of 90 years because it says so.We think that the proviso to covenant No. 9 could be said to suffer from the vice of an uncertainty which can only be removed by ignoring the words creating this uncertainty. We think that, in such a case, the ambiguous words can be disregarded so that the terms of the earlier operative part of the demise, which are clear, must prevail.28. We think that the argument that the rule that a grant, capable of two interpretations, should be construed in favour of the grantee, is obsolete and that we should employ some test of public interest amounts to a plea that we should depart from established canons of construction of deeds containing grants on grounds of public policy which has been described as an "unruly horse." It is more appropriate to address arguments based on public interest and public policy to a legislature where such policies are given legal expression. Our task as we conceive it in the present case, is merely to construe an agreement embodied in a lease, in which the lessor is the grantor, according to ordinary well-recognised rules of construction one of which is found stated in Smt. Bina Das Guptas case, AIR 1968 SC 39  do not think that it had really so used it although it had considered the conduct of the defendants in accepting rent on the basis that it was a 90 years lease on a rent of Rs. 365/- per year until after 1955, without mentioning a right of enhancement of rent in the deed of 1955 to be circumstances indicating that the defendants themselves had put an interpretation upon the original lease which the Division Bench accepted as correct by finding out the meaning of the deed of 1931 first. We have not found it necessary to rely upon anything in the agreement of 27-5-55 either for interpreting the terms of the lease of 17-9-31 or as an admission on any question or as providing a basis for an estoppel or as a circumstance supporting our view. As indicated above, we have reached our conclusion, quite apart from the contents of the subsequent agreement or the conduct of the parties, by intepreting the lease deed of 17-9-31 on its own language and terms. We think that, on the language of the lease itself, the interpretation adopted by us is the only one which could give effect and meaning to all its parts read as a whole.