1950 Supreme(All) 317
IN THE HIGH COURT OF ALLAHABAD
Kidwai, Chandiramani and Agarwala, JJ.
SUKHNANDAN - Appellant
Versus
SURAJ BALI - Respondents
Second Appeal 110 Of 1945
Decided On : 10/06/1950
Anand Madhava, B.K.DHAON
Headnote:
PRE-EMPTION - OUDH LAWS ACT, SECTION 13 - INTERPRETATION - "AND" IN CLAUSE (D) AND LAST PARA CONSTRUED CONJUNCTIVELY - CONDITIONS FOR REDUCING AMOUNT TO BE PAID FOR PRE-EMPTION.
Fact of the Case:
The plaintiff, a pre-emptor, filed a suit to enforce his right of pre-emption under Section 13 of the Oudh Laws Act. The notice required by Section 10 was not given, and the plaintiff had a preferential right to pre-empt. The issue was the sum upon payment of which pre-emption was to be allowed.
Finding of the Court:
The court held that the word "and" in Clause (d) and the last paragraph of Section 13 should be understood to indicate a conjunctive sense. All three conditions enumerated in Clause (d) must exist before the court can reduce the amount to be paid for pre-emption.
Issues: 1. Whether the word "and" in Clause (d) and the last paragraph of Section 13 should be construed conjunctively or disjunctively. 2. Whether the court can reduce the amount to be paid for pre-emption if any of the conditions enumerated in Clause (d) exist.
Ratio Decidendi: 1. The court found that the word "and" in Clause (d) and the last paragraph of Section 13 should be construed conjunctively. This interpretation is consistent with the intention of the Legislature as expressed in the other provisions of the Act relating to sales and foreclosure. 2. The court held that the court cannot reduce the amount to be paid for pre-emption if any of the conditions enumerated in Clause (d) exist. All three conditions must be fulfilled before the exception comes into operation.
Final Decision: The appeal was allowed, the judgment and decree of the Courts below were set aside, and the case was remanded to the trial Court to frame the necessary issue and determine whether: (a) the amount claimed by the mortgagee was not really due on the footing of the mortgage; and (b) the amount was claimed in good faith.
( 1 ) THE facts of this case are set out in the referring order and need not be repeated. The question for consideration is what is the true meaning to be assigned to the relevant provisions of Section 13, Oudh Laws Act, which reads as follows :
"any person entitled to a right of pre-emption may bring a suit to enforce such right on any of the following grounds (namely) : (a) that no due notice was given as required by Section 10 ; (b) that tender was made under Section 11 or Section 12 and refused ; (c) in the case of a sale, that the price stated in the notice was not fixed in good faith ; (d) in the case of a mortgage, that the amount claimed by the mortgagee was not really due on the footing of the mortgage and was not claimed in good faith, and that it exceeds the fair market-value of the property mortgaged, or the portion of the property mortgaged in respect of which he possesses the right of pre-emption, as the case may be. If, in the case of a sale, the Court finds that the price was not fixed in good faith, the Court shall fix such price as appears to it to be the fair market-value of the property sold, or the portion of the property sold in respect of which he possesses the right of pre-emption as the case may be. If, in the case of a mortgage, the Court finds that the amount claimed by the mortgagee was not really due on the footing of the mortgage, and that it was not claimed in good faith and that it exceeds the fair market-value of the property mortgaged, or the portion of the property mortgaged in respect of which he possesses the right of pre-emption, as the case may be, the amount to be paid to the mortgagee shall not exceed what the Court finds to be such market-value. "
( 2 ) IN the present case the notice required by Section 10 was not given. The plaintiff had, therefore, a right, under Section 13 (a), to institute the suit and it has been found that he had a preferential right to pre-empt. It has to be determined what is the sum upon payment of which pre-emption is to be allowed.
( 3 ) NORMALLY pre-emption can be allowed upon payment of the amount mentioned in the foreclosure decree. The last para, of Section 13, however, provides an exception. Giving the language used by the Legislature its prima facie meaning three conditions require to be fulfilled before the exception comes into operation. These conditions are : (1) It must be shown that the amount entered in the decree was not really due on the footing of the mortgage : (2) It must be shown that the amount was not claimed in good faith: and (3) It must be shown that the amount for which the foreclosure decree was passed exceeds the fair market-value of the property mortgaged.
( 4 ) IT was, however, contended that the word and used in Clause (d) and in the last paragraph of section 13 is not used in a conjunctive sense but is used in a disjunctive sense and that it should be read as "or". Thus, if any of the conditions above enumerated exists, the Court would be bound to pass a decree for pre-emption upon payment of an amount not exceeding the market value of the property, even though the amount actually due on the mortgage was greatly in excess of that amount and there was no mala fide in the claim.
( 5 ) THE learned counsel for the appellant in support of his contention relied upon the decision of a bench of the Court of the Judicial Commissioner of Oudh in Reoti Ram v. Lachhman Prasad, 10 o. C. 179. This decision was followed by a Bench of the Chief Court in Qadir Husian v. Muhammad Fazal Haq, 8 O. W. N. 44 : (A. I. R. (18) 1931 Oudh 137) and by a single Judge in mt. Jairaji v. Udai Raj Singh, 1943 O. W. N. 191: (A. I. R. (30) 1943 Oudh 282 ). It is because of these decisions that the present reference to a Pull Bench was made.
( 6 ) THE fundamental principle of construction is that the words used in a Statute must be understood in their ordinary grammatical sense. It is clear that, in that sense, the word "and" is used as a conjunction. Th