Authored By : Banerjee, Beverley

Banerjee, J.

1. The questions which have been referred to the Full Courtfor decision in this case are:

First.-Whether the case of Girish Chundra Basu v. ApurbaKrishna Vass I.L.R. Cal. 940 was rightly decided

Second.-Whether the cases of Lal Mohun Mukcrjee v. JogendraChunder Boy I.L.R. Cal. 636 and Uzir Ali v. Ram Komal Shaha I.L.R. Cal. 383 wererightly decided

2. In the case of Lal Mohun Mukerjee v. Jogendra Chunder BoyI.L.R. Cal. 636, the earliest of the three cases referred to above, thequestion was whether Section 174 of the Bengal Tenancy Act was applicable to asale hold after that Act had come into operation, when the execution had beenapplied for, and sale proclamation issued, under Bengal Act VIII of 1869. TheFull Bench answered the question in the negative, holding that Section 174 ofthe Bengal Tenancy Act could not have any retrospective operation, as itconferred upon judgment-debtors a new right which they did not possess underthe old Act, and as the proceedings had commenced before the new Act came intoforce.

3. In the next case in order of time, Uzir Ali v. Ram KomalShaha I.L.R. Cal. 383, the question was whether Section 174 of the BengalTenancy Act applied to a sale held under an execution applied for after thatAct had come into operation, when the decree was patted under the old Act. TheFull Bench answered the question in the negative, holding that the case was notdistinguishable in principle from that of Lal Mohun Mukerjee v. JogendraChunder Roy I.L.R. Cal. 636.

4. In Girish Chunra Basu v. Apurba Krishna Dass I.L.R. Cal.940, the last of the three cases referred to above, the question was whetherSection 310 A of the Code of Civil Procedure, which was added to the Code byAct V of 1894, was applicable to a sale held after the date on which that Actcame into operation, when the execution had been applied for, and saleproclamation issued, before that date. The majority of the Bench which heardthe case answered the question in the negative, following the two earlier casesrelating to Section 174 of the Bengal Tenancy Act and holding that Section 310Aof the Civil Procedure Code, like Section 174 of the Tenancy Act, was aprovision conferring a right and not relating merely to procedure.

5. These decisions, no doubt, are all based upon the generalground that a provision of law like that contained in Section 174 of the BengalTenancy Act, or Section 310A of the Civil Procedure Code, confers a new righton judgment-debtors, and should not, therefore, be held applicable to any casein which the decree was passed before such provision came into force; but asthe three cases differ from one another in certain points, and as it remains tobe seen whether, even if the general ground mentioned above be not a sound one,those points of difference may not afford ground for justifying the decision inone case, though not in another, it is convenient to consider the casesseparately.

6. I shall consider first the case of Lal Mohun Mukerjee v.Jogendra Chunder Boy I.L.R. Cal. 636 as being the earliest of the three casesand the strongest one for the decree-holder and the auction-purchaser in whosefavour the decision was given. In this case MITTER, J., who delivered thejudgment of the Full Bench, said: "We are of opinion that an applicationunder Section 174 of the Bengal Tenancy Act cannot be entertained in respect ofsales held in execution of decrees made before the date when that Act came intooperation, the execution of the decree having been applied for before theaforesaid date. Section 174 of the Bengal Tenancy Act confers upon the debtorsa new right which they did not possess under the old Act. Therefore thepresumption is (in the absence of express legislation or direct implication tothe contrary) that its operation is not intended to be retrospective itsprovisions cannot, therefore, be applied to proceedings commenced before theAct came into operation." The reasoning in this judgment consists of twodistinct and independent parts.

7. The first part is to the effect that, since a law whichcreates a new right ought not to have retrospective effect, and since Section 174of the Bengal Tenancy Act creates a new right in favour of judgment-debtors,therefore Section 174 ought not to have retrospective effect, that is, effectin cases in which the decree by which the applicant became a judgment-debtorwas made before that section became law.

8. And the second part is to the effect that, sinceproceedings commenced under any law ought not to be affected by any change inthat law, and since the proceedings in this case were commenced under the oldrent-law, therefore they ought not to be affected by Section 174.

9. These two branches of the reasoning require separateexamination.

10. I must respectfully dissent from the conclusion in thefirst part of the above reasoning, as 1 am unable to accept the premises uponwhich it is based as correct.

11. In the first place, to my mind, the broad generalproposition, which this reasoning adopts as its major premise, namely, that alaw creating a new right ought not to have retrospective effect, is notuniversally true. Ordinarily, no doubt, a new law should affect only futuretransactions and not past ones: Urquhart v. Urquhart 1 Macq. H.L.C. 662. Butthe rule against retrospective operation is intended to apply not so much to alaw creating a new right as to a law creating a new obligation or interferingwith vested rights : See Reid v. Reid IL.R. Ch. D. 408, Gardner v. Lucas IL.R.App. Cas. 582. This is how the rule has generally been understood and laid downin text-books. Maxwell in his treatise on the interpretation of statutes says:"It is chiefly when the enactment would prejudicially affect vestedrights, or the legal character of past transactions, that the rule in questionoperates. Every statute, as has been said, which takes away or impairs vestedrights acquired under existing laws, or creates a new obligation, or imposes anew duty, or attaches a new disability in respect of transactions orconsiderations already 778] passed, must be presumed, out of respect to theLegislature, to be intended not to have a retrospective operation" (2ndedition, p. 257). [See also Wilberforce on Statute Law, page 157; Sedgwick onStatutory Law, 2nd edition, 160.]

12. As the creation of a new right in one class of personsis generally attended with the imposition of new obligations on, or theinterference with vested rights of, other classes, a law creating a new rightwould, in general, be subject to the rule against retrospective operation. Butwhere, as in this case, the new right (conceding for the moment that it is anew substantive right) is created expressly under conditions which prevent itsimposing any new obligation on, or its interfering with any vested right in,others, the reason for the rule ceases to exist, and the rule must, therefore,cease to be operative. The only persons who can possibly be affected by aprovision like that contained in Sub-sections 1 and 2 of Section 174 of theBengal Tenancy Act, in favour of the judgment-debtor, are the decree-holder andthe auction-purchaser; and the section expressly provides that thejudgment-debtor is entitled to have the sale set aside only upon payment, notmerely of compensation to the purchaser, but also of the whole amount due underthe decree with costs to the decree-holder. Thus the vested right of thedecree-holder, which is to obtain satisfaction of his decree, is leftunaffected by this provision, except so far as it is to his advantage; for thesale may not always pay him in full, but the application of Section 174 inevery case will. As regards the auction-purchaser, five per con turn on thepurchase-money, though ordinarily a sufficient compensation, may not be so whenhe makes a vary favourable bargain; but as the sale took place after the newlaw came into operation, and he must be taken to have made his bid with full knowledgeof the law, it cannot be said that any vested right of his is affected by it.

13. Then, in the second place, I do not think that Section174 creates any new substantive right in the judgment-debtor. It embodies insubstance a rule of procedure, which provides that, after a sale in executionof a decree has taken place and before it is confirmed, if the judgment-debtordeposits a certain sum in Court, the decree-holder shall realize his dues outof the amount so deposited, and not out of the sale proceeds, and theauction-purchaser, whose right does not become perfect until the sale isconfirmed by the Court, shall not be entitled to have the sale confirmed, butshall receive back the purchase-money with a certain compensation out of themoney deposited. It being thus really a matter of procedure, there can be noobjection to its having effect immediately, even though it should affect pasttransactions and the mode of enforcement of vested rights, [see Gardner v.Lucas IL.R. App. Cas. 603], "provided, of course," as Mellish, L.J.,said in the case of the Republic of Costa Rica v. Erlanger IL.R. Ch. D. 69,"that no injustice is done." And I have shown above that thiscondition is here fully satisfied.

14. Then, again, it is assumed, in the above reasoning, thatthe operation which the applicant under Section 174 of the Bengal Tenancy Actsought to give to that section was retrospective in its nature, and it isfurther assumed that there is nothing implied in the scope and purposes of thesection to shew that it was intended to have any retrospective effect:assumptions the correctness of which I am by no means prepared to admit.

15. When the sale which was sought to be set aside in thiscase was held after the new Act had come into operation (and I may add that thesame was the state of facts in the other two cases and also in the case whichhas given rise to this reference), the assumption that the application of theAct to such a sale would be to give it retrospective effect is, in my opinion,not a correct assumption. In setting aside, under Section 174, a sale heldafter that section had become law, the direct effect of the section would beprospective only, though the sale might depend upon a decree andexecution-proceedings of dates antecedent to that of its becoming law. Thisdistinction is well pointed out by Lord Den-man in Queen v. The Inhabitants ofSt. Mary Whitechapel 12 Q.B. 127, in which his Lordship, speaking of a statutewhich is in its direct operation prospective, said: "It is not properlycalled a retrospective statute because a part of the requisites for its actionis drawn from time antecedent to its passing;" and this observationapplies with peculiar force to a case like the one now under consideration,where the facts antecedent to the passing of the new law go so little todetermine the person who is really affected by the application of the new law,I mean the purchaser.

16. Then, as regards the second assumption, no doubt it istrue that the Bengal Tenancy Act contains no express words to indicate thatSection 174 is to have any retrospective effect. But though there may not beany express words to that effect, still it may be shown by the general scopeand purpose of the enactment that it is intended to have retrospective effect.See Pardo v. Bingham IL.R. Ch. App. 740. And if we look to these, there canremain very little doubt as to what the Legislature intended in the presentinstance. Under the old law, if a tenure or holding was sold in execution of adecree for rent, and the sale was for inadequate value, the tenant could getthe sale set aside only if he could prove that the inadequacy of price was dueto some irregularity in publishing or conducting the sale; and, if there was nosuch irregularity, but the sale nevertheless resulted in loss, however greatthe loss might be, the tenant was obliged to bear it as a necessary evil. Itwas this evil which Section 174 of the Bengal Tenancy Act was intended toremedy, and it is difficult to imagine that the Legislature intended to limitthe remedy to those cases in which the sales were held in execution of decreesmade subsequently to the passing of the Act, and to allow the evil to continuefor years to come, during which decrees made under the old Act might go onbeing enforced by the sale of tenures or holdings, when the application of thenew law to sales in execution of decrees passed under the old law could notpossibly have resulted in any hardship or injustice. As a remedial provision,it ought to be liberally construed so as to apply to every sale of a tenure orholding in execution of a decree for arrears of rent, held after the passing ofthe Act, irrespective of the date of the decree.

17. The second branch of the reasoning in Lal MohunMukerjees case I.L.R. Cal. 636 requires separate examination. The sale washeld in the course of execution-proceedings instituted under the old Act(Bengal Act VIII of 1869), which was repealed by the Bengal Tenancy Act. Now,Section 6 of the General Clauses Act I of 1868 provides that the repeal of anyAct shall not affect any proceeding commenced before the repealing Act shallhave come into operation, and whatever doubt there may be as to whether aproceeding in execution is a proceeding in a suit [as to which point see DebNarain Dutt v. Narendro Krishna I.L.R. Cal. 267, and Code of Civil Procedure,Section 647, Explanation], there can be no room for doubt that theexecution-proceeding in this case was a proceeding "commenced before therepealing Act came into operation." It might be said, therefore, that theexecution-proceeding in this case was unaffected by the repeal of Bengal ActVIII of 1869, and, therefore, unaffected by the provisions of Section 174 ofthe repealing Act. No doubt the operation of Section 6 of Act I of 1868, in makingpending proceedings continue to be regulated by the old procedure, is limitedto cases in which the change in the law is the result of repeal of the oldenactment, and does not extend where it is due merely to an addition to it. Butit may not be clear that Section 174 of the Bengal Tenancy Act is purely aprovision of this latter description. It is one of a group of provisions in anenactment which repeals the old law and takes its place. If the matter had beenunaffected by the provisions of Section 6 of the General Clauses Act, I shouldhave felt little hesitation in saying that this part of the decision in LalMohun Mukerjees case I.L.R. Cal. 636 was also incorrect. As it is, and as thispoint was not discussed in the argument before us, and does not affect thedecision of the case which has given rise to this reference, I do not think itdesirable to pronounce any decided opinion upon it; though I may add that theobject of Section 6 of the General Clauses Act may be simply to leaveproceedings commenced under the old Act unaffected by the repealing Act, onlyso far as they have proceeded, leaving their further progress to be regulatedby the procedure in force after the repeal; upon which view the second branchof the reasoning will not have any greater force than the first,

18. In my opinion, therefore, the decision in Lal MohunMukerjees case I.L.R. Cal. 636, so far as it holds that Section 174 of theBengal Tenancy Act creates a new right in a judgment-debtor, and is, therefore,inapplicable to a case in which the decree was passed before that Act becamelaw, is wrong; but I abstain from pronouncing any opinion upon the correctnessof the other ground of the decision, namely, that the section was inapplicableto the case by reason of its being a pending proceeding instituted under theold law.

19. The case of Uzir Ali v. Bam Komal Shaha I.L.R. Cal. 383need not detain me long. It is based wholly upon the first of the two groundsupon which the decision in Lal Mohun Mukerjees case I.L.R. Cal. 636 is based,namely, that Section 174 creates a new right in favour of the judgment-debtor;and, as I have shown above that that ground is not sound, I must say that thiscase was incorrectly decided.

20. It remains now to examine the case of Girish ChundraBasu v. Apurba Krishna Dass I.L.R. Cal. 940. The majority of the learnedJudges, who decided that case, were of opinion that it was governed by theprinciple laid down by the Full Bench decisions in the cases of Lal MohunMukerjee I.L.R. Cal. 636 and Uzir Ali I.L.R. Cal. 383. But as I have, for thereasons given above, said that the principle laid down in those cases that aprovision like that in Section 174 of the Bengal Tenancy Act creates a newright, is not a correct one, I must say that the case of Girish Chundra Basu v.Apurba Krishna Dass I.L.R. Cal. 940 was incorrectly decided. Though here theexecution-proceedings were instituted under the old law, [the case isunaffected by Section 6 of the General Clauses Act, as the change in the lawwas brought about, not by the repeal of the old Act, but by the addition to itof a new section, namely, Section 310A. And all that, I have said above withreference to Lal Mohun Mukerjees case I.L.R. Cal. 636 excepting so much asrelates to the effect of Section 6 of Act I of 1868, applies with full force tothis case.

21. It was argued for the auction-purchaser that Section310A of the Code of Civil Procedure differs from Section 174 of the BengalTenancy Act, in being less favourable to the decree-holder than the latterprovision, as it does not provide for the immediate payment by thejudgment-debtor of the costs and interest accruing after the issue of the saleproclamation, and not entered in it. I do not consider this a material point ofdistinction at all, as the decree-holders right to realize these costs andinterest remains unaffected by Section 310A.

22. I would, therefore, answer the questions referred to usas follows:

1. The case of Girish Chundra Basu v. Apurba Krishna DassI.L.R. Cal. 940, was not rightly decided.

2. The case of Uzir Ali v. Ram Komal Shaha I.L.R. Cal. 383,was not rightly decided; nor was the case of Lal Mohun Mukerjee v. JogendraChunder Roy I.L.R. Cal. 636 rightly decided, so far as it laid down theprinciple that Section 174 of the Bengal Tenancy Act created a new right injudgment-debtors, and was, therefore, inapplicable to a case in which thedecree was passed before that Act came into operation.

23. But upon the question whether the order made in thelast-mentioned case was right under Section 6 of General Clauses Act, by reasonof the execution-proceeding having been commenced under Bengal Act VIII of1869, I pronounce no opinion.

24. It was contended on behalf of the auction-purchaser thatwhatever may be the decision of the Court upon the questions referred to it, itcould not interfere, under Section 622 of the Code of Civil Procedure, with theorder complained of in the case which has given rise to this reference. But ifI am right in the view I take of Section 310A of the Civil Procedure Code, theCourt below was bound, upon the application of the judgment-debtor in thiscase, to set aside the sale under that section, and, not having done so, it has"failed to exercise a jurisdiction vested in it by law," within the meaningof Section 622, so as to make its order open to revision by this Court.

25. I would, therefore, make the Rule absolute.

Beverley, J.

26. I concur in the able judgment of Mr. Justice Banerjee,with this reservation, that it does not appear to me from the report of thecase of Lal Mohun Mukerjee v. Jogendra Chunder Boy I.L.R. Cal. 636, that thelearned Judges who decided that case intended to base their judgment in any wayon Section 6 of the General Clauses Act I of 1868.

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Jogodanund Singh vs.Amrita Lal Sircar and Ors. (30.04.1895 -CALHC)