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Kamala Ranjan Roy Versus Baijnath Bajoria

1950 (12) TMI 28 - SUPREME COURT OF INDIA

C.A. 4 Of 1950 - Dated:- 1-12-1950 - Kania Hiralal J., Sastri M. Patanjali And Das Sudhi Ranjan, JJ. N.C.Catterjee (Samarendra Nath Mukherje, with him) for the appellant. P.L. Banerjee (Upendra Chandra Mullick, with him) for the respondent. JUDGMENT: Das Sudhi Ranjan, This is an appeal by the defendant in a suit for specific performance against the judgment and decree of the High Court of Judicature at Fort William in Bengal (Sir Trevor Hatties C.J. and Mukherjea J.) dated May 30, 1948, dismissi .....

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de on April 27, 1931, the Maharaja as manager of the Cossimbazar Raj Wards Estate which was then under the management of the Court of Wards demised tim said premises to one Madan Gopal Daga for a term of 51 years commencing from May 1, 1931, at and for the monthly rent of ₹ 1,083-5-3 and upon terms and conditions contained therein. By sub-clause (6) of clause 2 of the said Indenture the lessee covenanted, amongst other things, "not to assign the demised premises or any part thereof wi .....

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the defendant who was accepted as the lessee by the lessor. By an agreement said to have been arrived at by correspondence exchanged between the plaintiff and the defendant and their respective solicitors between January 27, 1945, and February 2, 1945, the defendant is alleged to have agreed to assign the said lease to the plaintiff for the unexpired residue of the term with effect from February 1, 1945, at and for the price of ₹ 1,80,000 and upon terms and conditions contained in the corr .....

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whole initiative was in the hands of the defendant. This letter clearly indicated that the lease had been determined for non-payment of rents and it obviously implied that it was for the defendant to get the lease revived by paying up the arrears of rent so that the question of giving consent to an assignment of the lease might be considered by the lessor. On March 8, 1945, the defendant by his solicitors letter informed the plaintiff s solicitors that the defendant had approached the lessor bu .....

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not refuse his consent to the transfer of the lease to a respectable or responsible person which the plaintiff undoubtedly was. It is not necessary to refer to the further correspondence that followed in which each party maintained his own contention. On March 17, 1945, the lessor filed a suit (being suit No. 425 of 1945) in the High Court against the defendant for the recovery of the demised premises on the ground that the lease had been determined. It was during the pendency of that suit that .....

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nt of the ejectment suit the defendant on August 6, 1945, applied to the lessor for his consent to the assignment of the lease and on the same day the lessor in reply declined to give his consent without assigning any reason whatever. The suit for specific performance came up for disposal before Ormond J. in November 1946 when it was heard in part and was adjourned. It was eventually further heard in January 1947 and finally disposed of on January 23, 1947, when Ormond J. passed a decree against .....

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t be brought out and placed before the Court for the purpose of enabling it to come to a proper decision on this point." The appeal was accordingly adjourned and the lessor was examined on commission and his evidence was filed in the proceedings. After further hearing the appeal Court dismissed the defendant s appeal and confirmed the decree for specific performance of the agreement without the need for obtaining the consent of the lessor prior to the execution of the deed of assignment in .....

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counsel appearing in support of this appeal is that, being subject to the consent of the lessor, the agreement was contingent on the defendant obtaining such consent and as the defendant could not secure the lessor s consent no effective agreement came into being which could be ordered to be specifically performed. The determination of this question must depend on a correct analysis and ascertainment of the meaning and import of the correspondence by which the agreement is said to have been arr .....

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e. (4). You shall have to obtain the necessary consent for the transfer of the lease in favour of myself or my nominees from the said Maharaja of Cossimbazar before the execution of the transfer of lease in my favour. The defendant replied to the plaintiff s above letter on January 28, 1945. By this reply the defendant expressed his willingness to transfer the lease to the plaintiff on terms contained therein. Clauses 3 and 4 of this letter were as follows: "(3) If your final acceptance as .....

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hese two letters for the defendant s letter was not an unconditional acceptance of the plaintiff s offer but amounted in law to only a counter-offer. By clause 3 the defendant offered to transfer the lease to the plaintiff as from February 1, 1945, so as to entitle the plaintiff to realize the rents from that date and to be liable to pay the rent to the lessor also from that date on two conditions, namely, that the plaintiff s acceptance was received within January 30, 1945, and the defendant wa .....

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consent to the assignment of the lease. Clause 4 of the defendant s letter was not so expressed as to make the defendant s offer contingent on his obtaining the lessor s consent. On the contrary, clause 4 constituted one of the terms of the offer which, on the offer being accepted, would become binding on the defendant as one of the terms of the agreement. The plaintiff, however, does not appear to have accepted the defendant s counter offer but on January 29, 1945, through his solicitors made .....

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sfer of the property in favour of our client will take effect on and from the 1st February, 1945, irrespective of the date of the conveyance, he being entitled to all the rents, issues and profits and being liable for all the liabilities in respect thereof since the said date. (e) That our client will not be liable to pay your Solicitor s Bill of cost in respect of the sale." Again, it will be noticed that by clause (b) the offer was not made contingent on the obtaining of the lessor s cons .....

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should be given effect to only in case the conveyance is completed in terms of clause (c) of your said letter." On February 2, 1945, the plaintiff by his solicitors letter of that date unconditionally accepted this reservation and so a concluded agreement was arrived at between the parties. This agreement was not, for its coming into being, contingent or conditional on the obtaining of the lessor s consent. The obligation to obtain the lessor s consent was cast upon the defendant as a term .....

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to refer to them in detail. Suffice it to say, that the words "such consent, however, not to be unreasonably withheld in the case of respectable or responsible person" contained in the covenant do not amount to a separate or independent covenant by the lessor that he would not refuse consent except upon reasonable grounds in the case of respectable or responsible person, but that those words limit or qualify the lessee s covenant not to assign the demised premises without the consent i .....

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ovenant so that the defendant could legally and validly assign the lease to him without such consent of the lessor. The first objection taken by the appellant to this contention of the plaintiff is that in his plaint the plaintiff insisted on the defendant obtaining the lessor s consent and that he should not have been permitted to make this new case at the hearing. Both the trial Court and the appeal Court held that there was, strictly speaking, no element of surprise, particularly because the .....

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ed by the plaintiff at the trial was an entirely new point or that the defendant was taken by surprise. The next objection of the appellant was that this point should not have been allowed to be raised and no evidence should have been permitted to be adduced on this point in the absence of the lessor as a party to the suit. We do not think that there is any force in this objection. The Court had to decide whether it was a case where relief by way of specific performance should be given. The Cour .....

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venant by reason of the lessor having unrea sonably withheld his consent. It is true that a decision on that question in this suit would not be binding on the lessor, but nevertheless the Court had to come to a decision on that question for the purposes of this suit as between the parties thereto in order to award the relief of specific performance to the plaintiff. The third objection of the appellant is that the appeal Court should not have allowed the plaintiff to adduce further evidence. It .....

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on can be taken to the course adopted by the appeal Court on that ground. We do not think there is any reason to interfere in the exercise of the Court s discretion. The fourth objection is that the High Court was wrong in holding that the term in the agreement that the defendant must obtain the consent of the lessor before executing the assignment to the plaintiff was a term for the benefit of the plaintiff only. It will be recalled that that was a term which was introduced by the plaintiff in .....

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lessor s consent as relieving him from the obligation of performing his part of the agreement if the plaintiff waived the objection and insisted on his carrying out the agreement. The absence of consent may amount to a defect in the title of the defendant, but which the plaintiff was willing to accept. Finally it is said that by directing the specific performance of the agreement the Court has exposed the defendant to the risk of an action for damages for breach of covenant. If the assignment o .....

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