Case: Chiranji Lal Khaitan &amp; Ors Vs. Moti Lal Saraogi

The appellants are the legal representatives of the original plaintiff Chiranji Lal Khaitan. The plaintiff was the owner of the suit property. According to the plaint case, the plaintiff leased out the property described in Schedule 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 plaintiffs knowledge the defendant constructed several structures on the land. In 1948 the plaintiff 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 November 1, 1948. As the defendant did not surrender possession of the property, the plaintiff instituted the suit from which this appeal arises on January 3, 1940, in the Court of Munsif at Purulia. At the time of the institution of the suit, the 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 on May (sic), 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 first 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 the High Court of Patna on September 7, 1956, and the same admitted by the High Court on September 10, 1956. 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 VII of that Act provided that the law then in force in the transferred territory was to continue until otherwise provided by the competent Legislature or other competent authority. In 1956 the West Bengal Legislature enactedthe 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 defendants pressed for decision only two points viz) That the plaintiffs claim is barred by equitable estoppel; and(2) The suit is liable to be dismissed under Section 9, read with Section 88 ofthe West Bengal Non-Agricultural Tenancy Act, 1949 (to be hereinafter referred to as the 1949 Act)2. 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 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.

Court's reasoning:
The High Court was greatly impressed by the width of Section 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 precedence 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 Section 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. There fore their application is subject to the conditions laid down by the 1958 Act. As seen earlier Section 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 the 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 clause (a) of the proviso to Section 3(2) acts duly done under the repealed laws are protected. Hence the quit notices given under Section 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 Section 3(2) of the 1958 Act. That interpretation also advances public interest. Otherwise all ejectment suits which had been instituted before the transfer of territories had been effected would automatically fail for non-compliance of Section 9 of the 1949 Act, a law which was not in force in the transferred territory before their transfer. The Legislature would not have intended such a result10. If the plaintiff was not required to comply with requirements of Section 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 clause (iii) of Section 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 clause (iii) if Section 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 arise3. 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 or findings of fact. We see no reason to review those findings.