Judgment Case ID: 3733

Judgment:
ivil Appeal No. 1252 of 1976. Appeal by special Leave from the Judgment and Order dated 13 8 1975 of the Allahabad High Court in Second Appeal No. 179/ 75. K. Gupta	 for the Appellant. S.T. Desai and R.B. Datar for the Respondent. SHINGHAL	 J. This appeal	 by special leave	 is directed against the summary dismissal of defendant Piarey Lal 's second appeal on August 13	 1975. As the leave has been limited to the question of interpretation of clauses (a) and (b) of section 30 of the U.P. Consolidation of Holdings Act	 1953	 (hereinafter referred to as the Act)	 "for the pur pose of deciding whether the liability of the petitioner to specifically perform the contract of sale of the old hold ing was transferred to the new 'chak ' allotted to him on consolidation	 it will be enough to state the facts which bear on it. 916 Respondent Hori Lal raised the suit for specific per formance of an agreement dated March 6, 1966, for the sale of six plote of land measuring nine high and six biswas in village Hathiawali, Tehsil Gannaur. It was alleged in the plaint that Rs. 3000/ were paid by the plaintiff Hori Lal in advance, and the balance of Rs. 2000/was to be paid at the time of the execution of the sale deed, within one year of the agreement. It was also pleaded that as defendant Piarey Lal refused to execute the ' sale deed, the plaintiff was driven to the necessity of filing the suit for specific performance of the agreement for sale and, in the alterna tive, for the recovery of Rs. 3000/which had been paid as advance. Defendant Piarey Lal denied the execution of the agreement for sale and the receipt of Rs. 3,000/ , and pleaded that as new plots had been allotted as a result of the consolidation of his holding under the Act, he could not perform the agreement for sale. The trial court framed issues, inter alia, on questions relating to the execution of the agreement for sale, payment of Rs. 3000/ to the defendant, and the inability of the defendant to perform the contract. That court held that the plaintiff had proved the agreement for sale and the payment of Rs. 3000/ ' . It also held that the agreement for sale could be enforced for plots allotted to the defendant in lieu of plot mentioned in the agreement in consolidation. " It therefore decreed the suit for specific performance by its judgment dated August 23	 1973. The Second Additional District Judge	 Badaun	 upheld the decree	 and as the High Court has dismissed the second appeal as aforesaid	 defendant Piarey Lal has come to this Court for a redress of his grievance by special leave. As has been stated	 the limited question for considera tion in  this Court is whether the defendant was liable to specifically perform the contract for sale of his old hold ing even after its consolidation and the allotment of a 'chak ' ? It appears that there was controversy in the Allahabad High Court on the question whether an agreement for sale	 in the circumstances of a case like this	 was rendered void under section 56 of the Contract Act because of the order of consolidation allotting new plots for the earlier plots in respect of which the agreement for sale had been executed. A Single Judge of that Court took the view in Sugna and another vs Kali Ram and others(1) that the agreement became void and impossible of performance	 and was not saved by section 30 of the Act. A different view was however taken by another Single Judge in Chetan Singh and others vs Hira Singh and others(1). The matter was re ferred to a Division Bench in Shanti Prasad vs Akhtar and another.(2) One of the Judges in the Division Bench was the Judge who had given the decision in Chetan Singh 's case. The Bench held that the duty of the seller to execute the conveyance of the property agreed to be sold	 was a liabil ity recognised by law and was enforceable as the liability "relates to the land mentioned in the agreement" and was "transferred to the new 'chak '" under section 30(b) of the Act. The decision in Shanti Prasad 's case formed the basis of the decision of the first appellate (1) (2) (3) 917 court in this case	 and that appears to be the reason why the High Court has dismissed the second appeal summarily. The controversy therefore turns on the proper interpretation of section 30 of the Act which deals with the consequences which ensue on exchange of possession as a result of the allotment of a 'chak ' to the tenure holder. Clauses (a) and (b) of section 30 of the Act provide as follows	 "30.Consequences which shall ensue on exchange of possession. With effect from the date on which a tenure holder enters	 or is deemed to have entered into possession of the chak allotted to him	 in accordance with the provi sions of this Act	 the following consequences shall ensue (a) the rights	 title	 interests and liabili ties (i) of the tensure holder entering	 or deemed to have entered	 into possession	 and (ii) of the former tenure holder of the plots comprising the chak	 in their respective original holdings shall cease; and (b) the tenure holder entering into pos session	 or deemed to have entered into pos session	 shall have in his chak the same rights	 title	 interests and liabilities as he had in the original holdings together with such other benefits of irrigation from a private source	 till such source exists	 as the former tenure holder of the plots compris ing the chak had in regard to them. " It would thus appear that while clause (a) deals with the rights	 title	 interests and liabilities of the tenure holder entering into possession of the 'chak '	 as well as of the former tenure holder of the plots comprising the 'chak '	 in their respective original holdings	 and provides that those rights	 title	 interests and liabilities shall "cease"	 clause (b) provides that the tenure holder entering into possession of the 'chak ' shall have	 in that 'chak '	 the same rights	 title	 interests and liabilities "as he had in the original holdings. " The expression 'chak ' has been defined in section 3(1 A) of the Act to mean "the parcel of land allotted to a tenure holder on consolidation." The two clauses therefore are quite simple and clear	 and ' do not raise any real problems of interpretation	 but the question is whether there is justification for the argument	 in the facts and circumstances of this case	 that the expression "liabilities" would cover the liability of the seller (i.e. the defendant)	 under the aforesaid agreement for the sale of his original holding ? As is obvious	 clause (a) of section 30 does not bear on the question in controversy because it only provides for the cessation of the rights	 title	 interests and liabilities both of the tenure holder to whom the 'chak ' has been allot ted	 and of the former tenure holder 918 of the plots comprising the 'chak ' in their respective original holdings". There is no controversy that this was so in the present case. It is also no body 's case that the rights	 title	 and interests of the tenure holder entering into possession of his 'chak ' have any bearing on the con troversy relating to the specified performance of the agree ment for sale	 for all that has been urged before us is that the defendant	 as the tenure holder of the new holding or 'chak ' had the same "liabilities" in that 'chak ' as he had in the original holding. What therefore remains for consider ation is whether	 on the defendant 's entering into posses sion of his new land or 'chak '	 there was the same liability "in" the new land as "in" the original holding. It there fore to be examined whether	 by virtue of the agreement for sale	 any liability accrued "in" the original holding ? A cross reference to section 54 of the Transfer of Property Act shows that a contract for the sale of immovable property is a contract that a sale of such property shall take place on terms settled between the parties. It has however been specifically provided in ' the section that such a contract "does not	 of itself	 create any interest in or charge on such property. " It would therefore follow that the agreement for Sale in the present case did not give rise to any interest "in" the original holding of the defendant as the tenure holder. That being so	 there could be no occasion for the transfer of any such "liability in" the new land or 'chak ' of the defendant so aS to attract clause (b) of section 30 of the Act. In fact what the defendant	 was bound to do under section 55(1)(d) of the Transfer ' of Property Act was to execute a proper conveyance of "the property" which was the subject matter of the contract for sale	 and not of any other property. So when he lost that property as a result of the scheme of consolidation and his rights	 title	 interests ceased in that property by virtue of clause (a) of section 30 of the Act	 the agreement for sale became void within the meaning of section 56 of the Contract Act	 and it is futile to urge that they were saved by clause (a) or clause (b) of section 30 of the Act. We have gone through the decision in Shanti Prasad 's case (supra)	 but we find that while the High Court took note of the fact that the right 's	 title	 interests and liabilities of the tenure holder "in" his original holdings ceased	 and he acquired the same rights	 title	 interests and liabilities "in" the 'chak ' allotted to him	 it lost sight of the significance of the word "in"	 and the afore said provisions of section 54 of the Transfer of Property Act	 and disposed of the controversy before it by raising the other question whether "the tenureholder" was subject to any liability "in respect of" his old holding. That was why it fell into the error of holding that a liability was created in the original holding of the defendant	 and was transferred his 'chak ' on his entering into its possession. As has been shown	 that was an erroneous view which has to be rectified. It may be mentioned that counsel for the respondent tried to argue that the defendant was bound to execute a proper conveyance of his original holding	 which was the subject matter of the agreement of sale	 because	 that holding had been substituted" by the 'chak '. 919 He also tried to argue that the 'chak ' allotted to the defendant by way of consolidation of his holding was the same as his original holding so that there was no occasion to invoke section 30 of the Act. Counsel could not however support his argument by reference to the law	 or the facts of the case. Moreover he was unable to show how he could raise any such argument when the special leave had been limited to the interpretation of clauses (a) and (b) of section 30 of the Act. It would thus appear that the plaintiff respondent 's suit for specific performance of the agreement for sale was liable to dismissal	 and the High Court as well as the courts below erred in taking a contrary view. Counsel for the appellant has however frankly stated at the bar that the appellant would be willing to refund the sum of Rs. 3000/ along with interest at 6 per cent per annum from the date of payment. The appeal is allowed with costs	 the impugned judgment of the High Court is set aside	 and the suit of plaintiff respondent Hori Lal is dismissed in so far as it relates to specific performance of the agreement for sale. It is however ordered that the defendant shall repay Rs. 3000/ to the plaintiff	 along with interest at 6 per cent per annum from the date of payment	 within three months from today. M.R. Appeal allowed.

Summary:
The appellant Piarey Lal had agreed to sell his original holding to Hori Lal but later refused to do so on the ground that his property which was the subject matter of the con tract had been consolidated under the U.P. Consolidation of Holdings Act	 1953	 and it was impossible to perform the agreement. Hori Lal filed a suit for specific performance contending that the agreement for sale had created a liabil ity for Piarey Lal for the purpose of section 30(b) of the Act	 and the same was transferred to the new plot or "chak" allotted to him as a result of the consolidation. The suit was decreed by the Trial Court and Piarey Lal 's appeals before the District Court and the High Court were dismissed. Allowing the appeal by Special Leave the Court	 HELD: By virtue of section 54 of the Transfer of Property Act	 the agreement for sale did not give rise to any inter est "in" the original holding of the defendant as the ten ure holder. There could thus be no occasion for the transfer of any such 	 'liability" in his new land or "chak" so as to attract clause (b) Of section 30 of the Act. When he lost that property as a result of the scheme of consolida tion	 the agreement for sale became void. [918 C E] Sagna & Anr. vs Kali Ram & Ors. 	 approved. Shanti Prasad vs Akhtar & Anr. and Chettan Singh & Ors. vs Hira Singh & Ors. overruled.