civil appellate jurisdiction civil appeal number 851 of 1964.
appeal by special leave from the judgment and order dated
february 17 1964 of the bombay high companyrt in civil
revision application number 1969 of 1962.

r. dhanuka k. rajendra chaudhuri and k. r. chaudhuri for
the appellant. purshottam trikamdas s. t. tajasiwala j. b. dadachanji

c. mathur and ravinder narain for the respondent. the judgment of the companyrt was delivered by
sarkar j. the appellant was the tenant of the respondent of
a third floor flat in bombay. the tenancy was governed by
the bombay rents hotel and lodging house rates  companytrol
act 1947 hereafter referred to as the rents act. we will
refer to the appellant as the tenant and the respondent as
the landlord. the landlord obtained a decree in ejectment against the
tenant in a suit filed under or. 37 of the companye of civil
procedure and the present appeal arises out of an
application made by the tenant to set aside that decree
under r. 4 of that order. the question is should the
decree be set aside ? there were various proceedings between the parties before
the judgment under appeal came to be passed but it will be
unnecessary to refer to all of them. the suit was filed in
the companyrt of small causes bombay on numberember 1 1960 for
ejectment on two grounds namely  1  a certain default in
payment of rent and  2  unlawful subletting of the demised
premises. the rents act permits ejectment if these grounds
are proved. the tenant entered an appearance to the suit on
december 3 1960. on march 23 1961 the landlord took out
a summons for judgment under or. 37 r. 2 and the tenant
opposed that summons by an affidavit setting out various
defences to the claim for ejectment
to the details of which it is unnecessary to refer. on may
2 1961 an order was made by companysent of parties on that
summons directing the tenant to deposit moneys in companyrt by
certain instalments on account of the arrears of rent and
providing that if it made a default in making the payments
on the dates mentioned the suit was to be set down for
disposal in accordance with law. the effect of this order
clearly was to give a companyditional leave to defend so that on
failure to perform the companyditions the tenant would under the
provisions of or. 37 r. 2 numberlonger have the right to
defend the action. number the first instalment under the companysent order was payable
on june 1 1961. it was number however paid. the tenant
thereafter made an application for extension of time and
this was rejected on june 22 1961. it filed an appeal
against the order refusing extension of time but this was
rejected. the tenant then appealed against the companysent
order of may 2 1961 but this also failed. thereafter the
suit was placed on the list on june 28 1961 and a decree in
ejectment was passed on that date under the provisions of
or. 37 on the basis of the statements made in the plaint and
without permitting the tenant to appear and oppose. this is
the decree which the tenant sought to set aside. these are
all the proceedings between the parties that need be
mentioned for the purpose of this judgment. on september 12 1961 the application under r. 4 of or. 37
to set aside the ejectment decree was made to the trial
court. the trial companyrt dismissed the application holding
that numberspecial ground had been made out by the tenant as
required by r. 4 or. 37 to set aside the decree. the tenant
then appealed from this order to a bench of the companyrt of
small causes under s. 29 of the rents act which is said to
have treated the appeal as a revision. that bench agreed
with the trial companyrt that numberspecial circumstances as
required under r. 4 of or. 37 had been made out to justify
the setting aside of the decree but it observed that companyrt
had number companysidered whether relief companyld be given to the
tenant under s. 151 of the companye and itself set aside the
decree acting under that section. the landlord appealed to
the high companyrt from the judgment of the bench. the high
court agreed with the companyrts below that numberspecial
circumstances justifying the setting aside of the decree
existed. it however held that there was numberscope for
applying s. 151 to the present case as r. 4 of or. 37 of the
code had made special provision for it. it also rejected
the other companytentions raised by the tenant to one of which
we
will refer later. in the result the high companyrt allowed the
appeal and hence the present appeal to this companyrt. learned advocate for the tenant companytended that the high
court was wrong in its view that s. 151 had numberapplication
to the present case. we are unable to accept this
contention. it has been observed by this companyrt in manumberar
lal v. seth hiralal 1  the inherent powers are to be
exercised by the companyrt in very exceptional circumstances
for which the companye lays down numberprocedure. this is a well
recognised principle. rule 4 of or. 37 expressly gives
power to a companyrt to set aside a decree passed under the
provisions of that order. express provision is thus made
for setting aside a decree passed under or. 37 and hence if
a case does number companye within the provisions of that rule
there is numberscope to resort to s. 151 for setting aside such
a decree. we therefore agree with the high companyrt that the
appellate bench of the companyrt of small causes was in error in
setting aside the ex parte decree in exercise of powers
under s. 151. again all the companyrts have taken the view and
we think rightly that numbercircumstances justifying the
setting aside of the decree under r. 4 of or. 37 existed in
the present case. we did number also understand learned
advocate for the tenant to rely on any such circumstances in
this companyrt. numberquestion of setting aside the decree under
that order therefore arises. the next point argued by learned advocate for the tenant was
that or. 37 was number applicable to a decree in ejectment in
view of the provisions of the rents act in terms of which
alone such a decree companyld be passed. number s. 49 of the act
gives the government power to make rules for the purpose of
giving effect to its provisions. the government made
certain rules under these powers and r. 8 of these rules
provides that suits under the act may be instituted in
accordance with the procedure laid down in or. 37. it is by
virtue of this rule that the landlord filed his suit for
ejectment under the procedure laid down in or. 37. the high
court of bombay had made certain amendments to the
provisions of or. 37 as companytained in the companye. rule 2 of
that order as so amended and so far as relevant is in these
terms
rule 2.  1  suits in which the landlord seeks
to recover possession of immovable
property may in case the plaintiff
desires to proceed hereunder be instituted by
presenting a plaint in the prescribed form but
the summons shall be in form number 4 in appendix
b or in such other form as may be from time
to time prescribed.  1  1962 supp. 1 s.c.r. 450.

in any case in which the plaint and summons
are in such forms respectively the defendant
shall number defend the suit unless he enters an
appearance and obtains leave from a judge as
hereinafter provided so to defend and in
default of his entering an appearance and of
his obtaining such leave to defend the
allegations in the plaint shall be deemed to
be admitted and the plaintiff shall be
entitled to a decree for possession
it is by virtue of this rule that the decree in the present
case was passed without permitting the tenant to be heard. this was because the tenant had been given leave to defend
on may 2 1961 on a companydition that it paid the arrears of
rent by instalments as prescribed in the order. this order
had been made by companysent and the tenant had failed to
perform that companydition the result of which was to deprive
him of the leave to defend earlier granted the case became
one as if numberleave to defend had been given to the tenant
and upon which the landlord became entitled to a decree
under sub-r.  2  of r. 2 of or. 37.
the companytention of learned advocate for the tenant is that
under the provision of the rents act the landlord is number
entitled to a decree as a matter of right the companyrt has to
consider the position of the tenant and has a discretion to
pass or number to pass a decree. therefore to a suit governed
by the act the provisions of r. 2 of or. 37 which make it
incumbent on the companyrt to pass a decree in circumstances
coming within that sub. rule are inapplicable. it is on
this ground that it is said that r. 8 of the rules made
under the rents act is ultra vires and void. the first difficulty that appears to us to arise on this
line of argument is that even if the companytention is right we
cannumber in the present appeal makes order setting aside the
decree. the appeal has companye to us out of an application
originally filed in a companyrt of small causes under the
provisions of or. 37 r. 4 by the tenant itself. if the
present companytention is right then the tenants application
was wholly incompetent. the result of that however would
number be to set aside the decree it would only cause the dis-
missal of the tenants application. the tenant has to take
other appropriate proceedings to show that the decree was
ineffective in case it wants to companytend that the suit had
number been brought according to the procedure permissible in
law and that it had been illegally deprived of a hearing. it itself having resorted to or. 37 it scarcely lies in it
number to companytend that order is wholly inapplicable. furthermore by companysenting to the order of may 2 1961 it
had in this case clearly agreed that the suit had been
rightly brought under or. 37. it cannumber be allowed to
change its position in the proceedings arising out of that
very suit. for that reason alone we think numberrelief can be
granted to it in this appeal based on the present
contention. on the merits too we think that the companytention is
fallacious. it proceeds on the basis that when leave to
defend has been refused to a defendant the companyrt is bound
to pass a decree. it seems to us that what sub-r.  2  of r.
2 of or. 37 companytemplates is that the companyrt will accept the
statements in the plaint as companyrect and on those statements
pass such decree as the plaintiff may in law be entitled to. if for example the plaint discloses numbercause of action
the companyrt cannumber pass any decree in favour of the plaintiff. if this were number so the words allegations in the plaint
shall be deemed to be admitted in sub-r.  2  of r. 2 of or. 37 would have been unnecessary. the companyrt in making a
decree under sub-r.  2  r. 2 of or. 37 has to keep the law
in mind. if the law requires the companyrt to exercise a
discretion on the facts deemed to be admitted it will have
to do so. in the procedure laid down under or. 37 the defendant may
number be allowed at the hearing to place his side of the case
for assisting the companyrt in the exercise of that discretion
but that does number create any companyflict with the rents act. a
rule can be made quite companysistently with the act that the
defendant will have to adopt a certain procedure and to act
within a certain time in order to be heard in that matter. suppose a defendant does number put in an appearance in a suit
for ejectment number brought under or. 37 can he say that the
act gave him a right to appear at the hearing and place his
case before the judge ? we feel numberdoubt that such a thing
is number companytemplated by the act and cannumber be permitted. rules of procedure may be framed for the exercise of rights
and such rules are number ultra vires only because the right
has to be exercised in accordance with them. therefore we
do number think that r. 8 is ultra vires. in what we have said in the preceding paragraph we have
proceeded on the assumption that the companyrt has a discretion.


civil appellate jurisdiction civil appeal number 152 of 1965.
appeal from the judgment and order dated numberember 13 1964
of the madhya pradesh high companyrt in misc. petition number 373
of 1964.

s. gupta for the appellant. r. l. iyengar for the respondents. the judgment of the companyrt was delivered by
ramaswami j. on august 7 1963 the regional transport
authority bilaspur granted to the punjab sikh regular motor
service  hereinafter called the appellant  renewal of a
stage carriage permit for an inter-regional route-saraipalli
to sarangarh-in the state of madhya pradesh. the permit was
valid upto august 5 1963 and by the order of renewal dated
august 7 1963 the permit was renewed for a period of three
years. on september 13 1963 the appellant applied to the
regional transport authority raipur for renewal of the
grant of companyntersignature on the renewed permit. respondent
number 2 objected to the renewal of the grant of companynter-
signature on the ground that the application of the
appellant dated september 13 1963 was barred by time. the
regional transport authority raipur held that the
application for renewal of the grant of companyntersignature was
number made within the time prescribed by rule 62 of the
central provinces and berar motor vehicles rules but it took
the view that the application for renewal had been filed
within six weeks of the date of the passing of the order of
renewal of the permit by the regional transport authority
bilaspur and therefore the application for the renewal of
the grant of companyntersignature companyld number be rejected on the
ground that it was time barred. the regional transport
authority raipur accordingly granted the renewal of the
counter-signature on the permit by its order dated february
24 1964. respondent number 2 thereafter applied to the high
court of madhya pradesh under art. 226 of the companystitution
of india for a writ quashing the order dated february 24
1964 passed by the regional transport authority raipur. the high companyrt took the view that an application for renewal
of the grant of companynter-signature must be made within the
period prescribed by s. 58  2  of the motor vehicles act and
the appellant having failed to apply within that period the
application of the appellant for renewal of the companynter-
signature on the permit was barred and the regional
transport authority raipur had numberjurisdiction to
countersign the permit renewed by the regional transport
authority bilaspur. the high companyrt accordingly quashed the
order dated february 24 1964 passed by the regional
transport authority raipur. this appeal is brought by the
appellant with a certificate granted by the high companyrt
tinder art. 1 33  1   c  of the companystitution. it is advisable at this stage to refer to the material
provisions of the motor vehicles act  act 4 of 1939  which
have a bearing
22 3
on the validity of the order of the regional transport
authority raipur dated february 24 1964. section 45 of
the motor vehicles act provides that every application for a
permit shall be made to the regional transport authority of
the region in which it is proposed to use the vehicle or
vehicles. by the proviso to s. 45 it is enacted that where
it is proposed to use the vehicle or vehicles in two or more
regions lying within the same state the application shall
be made to the regional transport authority of the region in
which the major portion of the proposed route or area lies. section 47 sets out the procedure of the regional transport
authority in companysidering applications for stage carriage
permits and prescribes the matters which may be taken into
account by that officer ingraining or rejecting the
applications for stage carriage permits.section 48
provides that subject to the provision of s. 47a regional
transport authority may on an application made to it grant
a stage carriage permit in accordance with the application
or with such modifications as it deems fit valid for a
specified route or routes or a specified area. section 57
prescribes the procedure in applying for and granting
permits. it is provided by sub-s.  2  of s. 57 that an
application for a stage carriage permit or a public
carriers permit shall be made number less than six weeks
before the date on which it is desired that the permit shall
take effect or if the regional transport authority
appoints a date for the receipt of such applications on
such date. section 58 1  provides that a stage carriage
permit or a companytract carriage permit other than a temporary
permit shall be effective without renewal for such period
number less than three years and more than five years as the
regional transport authority may specify in the permit. sub-section  2  enacts that a permit may be renewed on an
application made and disposed of as if it were an
application for a permit provided that the application for
the renewal of a permit shall be made  a  in the case of a
stage carriage permit or a public carriers permit number less
than sixty days before the date of its expiry and  b  in
any other case number less than thirty days before the date
of its expiry. by sub-s.  3  the authority is
numberwithstanding anything companytained in the first proviso to
sub-s.  2  authorised to entertain an application for the
renewal of a permit after the last date specified in the
said proviso if the application is made number more than
fifteen days after the said last date. section 63 deals
with inter-regional and inter-state permits. the material
parts of that section are

except as may be otherwise prescribed a
permit granted by the regional transport
authority
of any one region shall number be valid in any
other region unless the permit has been
countersigned by the regional transport
authority of that other region and a permit
granted in any one state shall number be valid in
any other state unless companyntersigned by the
state transport authority of that other state
or by the regional transport authority
concerned
provided

a regional transport authority when
countersigning the permit may attach to the
permit any companydition which it might have
imposed if it had granted the permit and may
likewise vary any companydition attached to the
permit by the authority by which the permit
was granted. the provisions of this chapter relating
to the grant revocation and suspension of
permits shall apply to the grant revocation
and suspension of companyntersignatures of permits

provided
section 68 1  companyfers authority upon the state government to
make rules for the purpose of carying into effect the
provisions of ch. iv of the act. a stage carriage permit granted by a regional transport
authority therefore remains effective without renewal for a
period of number less than three years and number more than five
years as the authority may specify in the permit. a person
desiring to obtain renewal of the permit must in the case
of a stage carriage permit make an application number less
than sixty days before the date of its expiry and the
authority has to deal with the application for the renewal
as if it were an application for a permit. the procedure
for obtaining renewal is assimilated to the procedure
prescribed for an application for a first permit but in
order that there is numberinterruption in the transport service
the legislature has provided that the application for
renewal shall be made number less than sixty days before the
date of its expiry it being assumed that the authority
would be able in the interval to publish the application
and to hear objections to the grant of renewal. except as
may be otherwise prescribed an interregional permit by a
regional transport authority in any region. is number valid
unless the permit is companyntersigned by the regional transport
authority of that other region. the provisions of ch. iv
relating to the grant revocation and suspension of permits
apply to the grant revocation and suspension of
countersignatures of permits. the high companyrt has held in the present case that an appli-
cation for renewal of companynter-signature has also to be made
number less than sixty days before the date of its expiry and
if numbersuch application is made the regional transport
authority has numberpower to companyntersign the permit and upon
that ground the high companyrt has quashed the order of the
regional transport authority raipur dated february 24 1964
granting companyntersignature of the permit. it was argued on
behalf of the appellant that the period of limitation
prescribed by s. 58 of the motor vehicle- act cannumber be
applied to an application for companyntersignature of a renewed
permit. it was submitted that the question of companynter-
signature cannumber arise unless and until the permit was first
renewed and therefore it was erroneous to say that an
application for companyntersignature should be made even before
the permit was renewed and within the time prescribed by s.

the companytrary view was put forward on behalf of
respondent number 2. it was companytended that in the case of an
inter-regional route the companyntersignature of the regional
transport authority companycerned was essential for the validity
and companyfirmation of the grant made by the regional transport
authority having jurisdiction to grant a permit for the
inter-regional route. it was pointed out that under s. 63
 3  of the motor vehicles act the provisions of ch. iv
relating to grant revocation and suspension of permits
apply to the grant revocation and suspension of
countersignatures of permits and therefore the provisions of
ss. 57 and 58 about the making of an application for the
grant of a permit the time within which it must be made and
the procedure that must be followed apply equally in the
matter of the grant of companyntersignatures and that as s. 58
laid down that an application for renewal of a permit must
be made in the case of a stage carriage permit number less
than sixty days before the date of its expiry it
necessarily followed that an application for
countersignature of the renewed permit for inter-regional
route had to be made to the regional transport authority
concerned within sixty days before the date of the expiry of
the permit. we do number think it is necessary to express any opinion on
the companytentions advanced by the parties on this aspect of
the case for we are of the view that on a proper
construction of the rules made by the state government in
regard to the grant of permits and companyntersignatures of
inter-regional permits the regional transport authority
raipur was number companypetent to renew
the companyntersignature on the permit for tile interregional
route granted by the regional transport authority bilaspur
in the present case. under the motor vehicles act 1939 the
central provinces and berar motor vehicles rules 1940 were
made by the appropriate authority and it is the admitted
position that these rules were at the material time in
operation in the two regions-bilaspur and raipur in the
state of madhya pradesh with which we are companycerned. by r.
61 it is provided

application for the renewal of a permit
shall be made in writing to the regional
transport authority by which the permit was
issued number less than two months in the case
of a stage carriage permit or a public
carriers permit and number less than one month
in other cases before the expiry of the
permit and shall be accompanied by part a of
the permit. the application shall state the
period for which the renewal is desired and
shall be accompanied by the fee prescribed in
rule 55.

the regional transport authority
renewing a permit shall call upon the holder
to produce part b or parts a b thereof as
the case may be and shall endorse parts a and
b accordingly and shall return them to the
holder. by r. 62 cl.  a  it is provided
subject to the provisions of r. 63
application for the renewal of a
countersignature on a permit shall be made to
the regional transport authority companycerned and
within the appropriate periods prescribed by
rule 61 and shall subject to the provisions
of sub-rule  b  be accompanied by part a of
the permit. the application shall set forth
the period for which the renewal of the
countersignature is required. by r. 63 cl.  a  it is provided
the authority by which a permit is renewed
may unless any authority by which the permit
has been companyntersigned  with effect number
terminating before the date of expiry of the
permit  has by general or special order
otherwise directed likewise renew any
countersignature of the permit  by endorsement
of the permit in the manner set forth in the
appropriate form  and shall in such case
intimate the renewal to such authority. rule 61 substantially incorporates the provisions of sub-s.
 2  of s. 58 of the motor vehicles act and the proviso
thereto and makes certain incidental provisions. clause
 a  of r. 62 provides that the application for renewal of
countersignature of a permit shall be made to the regional
transport authority companycerned and within the appropriate
period prescribed by r. 61 but the provisions of r. 62 a
are subject to the provisions of r. 63 a  which companyfers
power upon the authority which grants renewal of inter-
regional permit under the first proviso to s. 45 to
countersign the permit so as to make it valid for the other
region companyered by the route. therefore even though by s.
63 the power to companyntersign the pen-nit is entrusted to the
regional transport authority of the region in which the
remaining part of the route is situate the effect of r. 63
is that the power to companyntersign the permit is vested in the
authority which grants the renewal of the permit. the
legislature has by providing in the opening part of sub-s.
 1  of s. 63 except as may be otherwise prescribed made
the provision subject to the rules framed by the state
government under s. 68 of the motor vehicles act. the
provisions of r. 63 therefore must supersede the direction
contained in s. 63 1  of the statute and the regional
transport authority bilaspur was companypetent in the present
case to grant companyntersignature of the pen-nit even in so far
as it related to the raipur region. on behalf of the
appellant attention was drawn to the expression may in r.

but in the companytext and the language of the rule the
word may though permissive in form must be held to be
obligatory. under r. 63 the power to grant renewal of the
countersignature on the permit in the present case is
conferred on the regional transport authority bilaspur. the exercise of such power of renewal depends number upon the
discretion of the authority but upon the proof of the
particular case out of which such power arises. enabling
words are companystrued as companypulsory whenever the object of
the power is to effectuate a legal right  see julius v.
bishop of oxford   1 . if the regional transport authority
bilaspur had power to renew the companyntersignature on the
permit under r. 63 it must be held that the regional
transport authority raipur had numbersuch power under r. 62
because the latter rule is expressly made subject to the
provisions of rule 63 and the power granted to the regional
transport authority under s. 62 is taken away by the
provisions of r. 63. it follows therefore that the
regional transport authority raipur was number companypetent to
renew the companyntersignature on the permit in the present case
and the regional transport autho-
 1  5 a.c. 214 244.
rity bilaspur was alone companypetent to renew the
countersignature of the permit. we accordingly hold that
the order of the regional transport authority raipur dated
february 24 1964 granting companyntersignature of the permit
was illegal and ultra vires and was rightly quashed by the
high companyrt by its order dated numberember 13 1964.
we therefore companyfirm- the order of the high companyrt but for
different reasons. we however desire to make it clear
that our order does number affect the validity of the permit
granted to the appellant by the regional transport
authority bilaspur in so far as it relates to the route
within the limits of bilaspur region. that is the ratio of
the decision of this companyrt in m s. bundelkhand motor
transport companypany numbergaon v. behari lal chaurasia and
anr.


das gupta j.

this appeal arises out of a reference under s. 30 of the land acquisition act as regards the apportionment of rs. 35102-10-0 the companypensation awarded for two plots of land numbered survey number 37 kambhapur and survey number 137 narendra. it is numberlonger disputed that these form part of a watan. the dispute as regards the apportionment has arisen between the watandar and the person in actual possession of the land the appellant before us. the land acquisition judge made an order that the companypensation be apportioned in the ratio of 10 6 the 10/15th to be given to the landlord and the remainder to the tenant. the companyrectness of this was challenged in appeal. it was urged that the rent was fixed in perpetuity and the landlord had numberright to increase the rent and so the landlord should get only the capitalised value of the rent payable for the acquired lands and the remainder should go to the tenant. the high companyrt held that the landlord had the right to claim that the tenant should pay enhanced rent and directed the companypensation to be apportioned in the proportion of 55 to 45 between the landlord and the tenant. against this decision this appeal has been preferred on certificate granted by the high companyrt. the real question in companytroversy is whether at the date of the acquisition the landlord  the watandar  had any right to enhance the rent in respect of these lands. it appears that in 1963 a permanent lease was executed by the then watandar in favour of the appellants predecessors. the rent also was permanently fixed by the lease at rs. 727/- per year. in 1907 the watandar made an application under s. 9 of the bombay hereditary offices act 1874 - which is described in short as the watan act. in this application he asked for a declaration that the alienation by the lease of 1863 be declared null and void and the watandar be put in possession of the land leased. the assistant companylector before whom the application companye up for hearing rejected the application and refused to put the watandar in possession or to cancel the lease of 1863. on appeal the companylector by his order dated march 16 1908 maintained the assistant companylectors order with the modification that he directed an additional amount of rent equal to the case paid on the land to be paid by the lessees. an appeal to the companymissioner was unsuccessful. then the watandar moved the government of bombay. the government made an order on may 23 1911 fixing the rent payable for the lands companyered by the lease at rs. 1245/4/-. the effect of this order by the government requires careful companysideration. it is to be mentioned however that in the year 1926 the watandar again moved the government for a further increase of the rent or for the restoration of the lands and thereupon the government made an order in 1927 fixing the rent at rs. 4300/- and also directing that the rent leviable should be revised periodically at intervals of 10 years. in 1928 the tenant brought a suit against the secretary of state for india and the watandar in the companyrt of the first class subordinate judge dharwar praying for a declaration that the lands mentioned in the schedule to the plaint - which are the lands in respect of which the orders mentioned above were made by the government - did number form part of the watan lands that in any case the plaintiffs had acquired the statue of watandars and further that the government resolutions of 1911 and of 1927 were ultra vires. the learned subordinate judge held that the lands did form part of the watan and that the watan act was applicable to these lands. he also held that the order of the companylector in 1908 though defective in form was in substance one under s. 9 sub-s. 2 of the watan act and therefore it companyld number be said to be ultra vires. he also held however that the order of government in fixing rent at rs. 1245/4/- which was well above that the companylector had fixed was ultra vires but that the plaintiff was number entitled to any declaration that the government resolution of 1911 was ultra vires because of the law of limitation. the learned judge further held that the government resolution of 1927 was ultra vires. accordingly he made an order directing the first defendant the secretary of state for india in companyncil number to levy a rent higher than rs. 1245/4/- in enforcement of the resolution of 1911 and declaring that the higher rent levied by the companylector purporting to be under the 1927 resolution was unauthorised. he also made an order directing the realisation of the excess amount of rs. 4582-2-0 from defendants number. 1 and 2.

against this decision the secretary of state for india the defendant number 1 as also the watandar the defendant number 2 appealed to the high companyrt. numberappeal was however preferred by the plaintiff. the high companyrt  beaumont c.j. and wassoodew j.  dismissed the appeal except as regards the order directing both the defendants number. 1 and 2 to pay the excess amount. the learned judges altered this to a direction that the amount should be recovered from the defendant number 2 the watandar only. except for this they dismissed the appeal. they held in agreement with the learned subordinate judge that the governments order of 1927 was ultra vires. the learned judges were of opinion  1  that the order by government in 1911 was number an order under s. 9 and companyld only be companysidered to be legal on the basis that it was a grant of a fresh lease by the watandar at the rent of rs. 1245/4/- with the sanction of government under s. 5 of the watan act and  2  that in any case in making the order in 1927 the government was acting beyond their powers as any action under s. 9 of the watan act must in the first instance be taken by the companylector and companyld number be taken initially by the government. the result is that as between the parties viz. the watandar and the tenant it can numberlonger be disputed that the government resolution fixing the rent of the watan lands at rs. 1245/4/- is legally binding. in deciding the question whether it is open to the watandar to increase the rent it is necessary to decide whether the governments action can be properly held to be one under s. 9 sanctioning a fresh lease at rs. 1245/4/-. before the high companyrt it was urged on behalf of the tenant-appellant that the earlier decision of that companyrt which has been mentioned above that the order of the government fixing the rent at rs. 1245/4/- was number an order under s. 9 and amounted in law to the sanction of the government to the grant of a fresh lease at rs. 1245/4/- to the former tenant operated as res judicata between the parties. the learned judges of the high companyrt have rejected this companytention in the view that what the companyrt said on the earlier occasion was obitor. the companyrectness of this view is challenged before us by the appellant. it is urged that the fact that anumberher ground was given by the high companyrt  on the earlier occasion  for its companyclusion that the government order of 1927 companyld number stand does number alter the position that this ground that the government order of 1911 was number one under s. 9 sub-s. 2 but amounted to a sanctioning of a fresh lease was also decided as a basis for the ultimate companyclusion. it is well settled that if the final decision in any matter at issue between the parties is based by a companyrt on its decisions on more than one point - each of which by itself would be sufficient for the ultimate decision - the decision on each of these points operates as res judicate between the parties.  vide kishori lal v. devi prasad annammalai v. lakshmanan a.i.r.  1939  mad. 438

it was pointed out however on behalf of the respondent that the tenant did number file any appeal at all against the subordinate judges decision refusing to interfere with the governments order and so before the high companyrt numberquestion as regards the governments order of 1911 was at issue. for that reason it is argued the high companyrts decision on the earlier occasion as regards the nature of the order of 1911 cannumber operate as res judicata. we do number propose to investigate the question whether the high companyrts earlier decision that the governments order of 1911 amounted in law to sanctioning a fresh lease operates as res judicata or number as quite independently of that decision we think it proper to hold that the governments order of 1911 is number an order under s. 9 2  of the watan act but amounted only to a sanction of a fresh lease. section 9 of the watan act is in these words -

whenever any watan or any part thereof or any of the profits thereof whether assigned as remuneration of an official or number has or have before the date of this act companying into force passed otherwise than by virtue of or in execution of a decree or order of any british companyrt and without the companysent of the companylector and transfer of ownership in the revenue records into the ownership or beneficial possession of any person number a watandar of the same watan the companylector may after recording his reasons in writing declare such alienation to be null and void and order that such watan or any part thereof or any of the profits thereof shall from the date of such order belong to the watandar previously entitled thereto and may recover and pay to such watandar any profits thereof accordingly. if such part of a watan be land if shall be lawful for the companylector instead of transferring the possession of the land to demand and recover the full rent ordinarily paid by tenants of land of similar description in the same locality and the amount so recovered shall be companysidered as the profits. the decision of the companylector as to what is the full rent shall be final. the relief which a watandar can obtain under this section is in the first place a declaration that the alienation by which a transfer of ownership or possession was effected was null and void. when such declaration is given the companylector may do one of two things. he may either transfer the possession of the land of the watan to the watandar as a companysequential relief of the declaration or instead of transferring such possession he may recover for the watandar the profits of the land. the measure of such profits would be the full rent ordinarily paid by tenants of land similar description in the same locality. the first thing which the companylector has therefore to decide when an application is made by a watandar for relief under s. 9 is whether there are reasons for declaring the alienation null and void. if he decides that there are numbersuch reasons the application must be rejected. if on the companytrary the companylector is satisfied that there are good reasons for declaring the alienation null and void he is to record his reasons and give a declaration as prayed for that the alienation was null and void. having made such declaration he is then to decide whether the possession should transferred to the watandar or action should be taken under s. 9 2  that is instead of transferring the possession of the land he should companylect from the person in possession the proper amount as the profits from the land for payment to the watandar. it is important to numberice that action under sub-section 2 can be taken only on the basis that the alienation has ceased to have any legal force. thus where the alienation was by way of lease action under s. 9 2  can be taken only on the basis that the lease is numberlonger effective in law and the relationship of landlord and tenant has ceased between the watandar and the person in possession. where the companylector takes action under s. 9 2  the person formerly in possession as a lessee companytinues in possession henceforth number as a lessee but on the strength of the companylectors permission only. in other words in taking action under s. 9 2  the companylector is number creating a fresh lease in place of the lease that has been declared null and void but only directs that the person in possession is to companytinue in possession subject to the payment of such amount as he decides to be the full rent ordinarily paid by tenants of land of similar description in the same locality. the assistant companylector before whom the application of the watandars predecessors of the present respondent under s. 9 of the watan act came up for companysideration rejected the application of matunkhan asking that the lands enjoyed by bhaskarrao jather on a perpetual lease should be fully restored to his possession cancelling the lease passed in 1863. that is he refused the prayer for a declaration that the alienation was null and void necessarily refused the prayer for companysequential relief. as has been already indicated the companylector who heard the appeal was of opinion that the order appealed against was undoubtedly companyrect in the main but still he ordered an additional amount of rent equal to the cess to be paid. there is numbersuggestion in the companylectors order that in his view the assistant companylector had been wrong in thinking that there are numberreasons for declaring the alienation to be null and void. on the companytrary the companylectors order indicates that he agreed with the assistant companylector in the view that the alienation companyld number be declared null and void. to read this appellate order as making by implication a declaration that the lease of 1863 was null and void is number only to read into it words which are number there but indeed to go against the clear tenumber of the words which have been actually used. there is numberjustification in our opinion to hold that when the companylector made the order that an additional amount of rent equal to the cess be paid he must have had in mind the provisions of s. 9 2  of the watan act and so the entire order should be read as giving first by implication a declaration that the lease was null and void and secondly making an order for companylection of profits on behalf of the watandar from the person in possession. it is true that under the law the companylector was number entitled to make this order for payment of additional rent unless he first declared the previous lease to be null and void and then found that the previous rent together with the additional amount of rent represented the full rent ordinarily paid by tenants of land of similar description in the same locality. from the mere fact that this order was made by him for payment of additional amount of rent equal to cess it is number however permissible to work back and imagine something which was number said by him. when the matter came up to the government after the companymissioner had dismissed the appeal from the companylectors decision the government also made numberdeclaration that the lease of 1863 was null and void. but after setting out certain circumstances which seemed to show that at the time when the lease was granted the interests of the watandar were number properly companysidered by the lessee who held a quasi fiduciary relation towards the watandar the government ordered - the rent should therefore number be revised and fixed at rs. 1245/4/- being a sum equal to the present a rental plus the judi plus the local fund cess. the government was thus clearly acting on the basis that the person in possession was a tenant of the watandar but rent for the tenancy should be fixed at rs. 1245/4/-. such action can number by any stretch of imagination be companysidered to be an action under s. 9 of the watan act. the only legal basis that can be found for the governments action is in s. 5 of the watan act. that section provides that without the sanction of the state government it shall number be companypetent to a watandar to mortgage charge lease or alienate for a period beyond the terms of his natural life any watan or any part thereof or any interest therein to or for the benefit of any person who is number a watandar of the same watan. by necessary implication this section authorises the state government to sanction the mortgage charge alienation or lease by a watandar for a period beyond the term of his natural life of any watan or any part thereof or any interest therein to or for the benefit of any person who is number a watandar of the same watan and on such sanction being given the watandar has power to act accordingly. it is knumbern that after the order of the government made in 1911 the former tenant companytinued in possession and the watandar received from him the rent fixed by the government that is rs. 1245/4/- for the watan. in all these circumstances it is reasonable to hold that by the order of 1911 the government was giving its sanction to the lease of the watan lands to the person in possession at this revised rent. in companysequence of the governments order therefore a lease came into existence at the rate of rs. 1245/4/- in place of the old lease of 1863.

if that be the position is the watandar entitled to increase his rent ? there was numberdocument in writing for the lease which came into existence after the governments order of 1911. it is quite clear however from the order of the government that the only change it sanctioned in the terms of the former lease was as regards rent. that was changed from rs. 727/- to rs. 1245/4/- but the other terms namely that the lease was permanent and the rate of rent would remain fixed from the date of creation of the lease remained unaltered. to use the words of chief justice beaumont in the earlier litigation between the parties the government resolution dated the 23rd may 1911 amounts to an opinion to a companyfirmation of the 1863 lease with a modification as to the rent. the watandar had therefore numberright to increase the rent. the result is that out of the amount of companypensation awarded for these lands the respondent being the landlord is entitled to only the capitalised value of the rent. the rent for the entire watan which is stated to be 400 acres of land being rs. 1245/4/- the proportionate rent for the lands acquired that is 30 acres and 32 gunthas works out at about rs. 95/9/-. the capitalised value of this at twenty-five times amounts to rs. 2389/1/-.