Sunil Kumar Roy v. M/S. Bhowra Kankanee Collieries Ltd. & Ors.

##### 232 • **SUNIL KUMAR ROY** _v._ **M/S. BHOWRA KANKANEE COLLIERIES LTD.** **&** **ORS.** _December_ 15, 1970 (J. C. SHAH, K. S. HEGDE AND A. N. GROVER, **JJ.]** _**Indian Registration**_ _**Act,**_ _**1908-Registered**_ _**/ease-Docu11zent**_ _**l'i:/Jich**_ _**raries essential**_ _**ter111s**_ _**such as**_ _**a1no1111t**_ _**of**_ _**rent**_ _**n1ust**_ _**be**_ _**registered.**_ The appellant purchased machineries etc. from the Eastern Coal Co. Ltd. and also took on lease the land on which the buildings stood. One of the terms of the lease which was dated May 17. 1946 was that royalty would be paid by the appellant at the rate of Re. 1/- per ton on despatches . **of** **coke.** **Jn** **1950 another arrangement was arrived at** **by** **which royaJty** on breeze coke was to be paid at 2 As. pe, ton. In December 1951. **according to the appellant. another arrangement** **was.** **made** **by** **which** the royalty on hard coke was reduced to 8 As. per ton_. The Eastern Coal Co. sold the collieries to Respondent no. 1 with effect from Jan•1ary I, 1955. Respondent no. 1 claimed royalty on all despatches of coke including breeze coke at the rate of Re. 1 per ton. The appellant paid only at . the rate of 8 As. per ton on hard coke and 2 As. per ton on breeze coke. Rcspondeht no. I filed a suit for the balance at the rate of Re. I per ton. The trial court held that document Exp. A-4 on which the appellant relied to prove the agreed reduction of rates was admissible in evidence although not registered, and dismissed the suit. The High Court did not consider the question of the admissibility of Ex. A-4 but decreed the suit on th" finding that the appellant had failed to prove that the reduction in the rate of royalty had been. given effect to from July _1952_ as claimed. In appeal by certificate to this Court, **HELD : Even on the assumption that a mutual** **arrang1 ·;:,1cnt** **or agree·** ment as evidenced by Ex A-4 was arrived at between the appellant and the Eastern Coal Co. Ltd. it could not be accepted that any reduction in royalty could have been effected by means of Exh. A-4 which bad **not been registered under the provisions** **of** **the Indian Registration Act.** JI. is well settled that a document which varies the essential terms of the **existing registered lease such** **as** **the amount** **of** **rent, must be registered.** - [234 **E-F]** _Durga Prasad Singh_ v. _Rajend.a Narain Bagchi,._ l.L.R. 37 Cal. 293 **and** _La/it. Mohan Ghosh_ v. _Gopal Chuck Coal Co. Ltd.,_ J.L.R. 39 Cal. 284, approved. _Obai Goundan_ v. _Ramalinga Ayyar,_ I.LR. 22, Mad. 217, disapproved, **A** **B** ### **c** **D** **E** **F** CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2428 of **G** 1966. Appeal from the judgment and decree dated October 9, 1964 of the Patna High Court in Appeal from original decree No. 459 of 1959. _B._ _Sei1_ **and** _**Sukumar**_ _Ghose,_ for the appellant. ## M. c. Chagla, S. C .. Banerjee and A. K. Nag, for respond~nts Nos. 1 and 2. # H • A B ## c D Grover, J.-This is an appeal by certificate from a judgment of the Patna High Court. The facts may be shortly stated. By a registered indenture of lease dated December 18, 1900 the Eastern Coal Co. Ltd. was granted a lease by the Zamindar of Jharia of certain land in mauza Gourkhanti in pargana Jharia. The Eastern Coal Co. erected buifdings for manufacture of coke and also constructed office and the quarters for the staff and the labourers. On May 17, 1946 the Eastern Coal Co. sold the machineries on the demised land to the appellant and also granted a lease of the land on which the buildings stood to him. One of the terms of the lease was that royalty would be paid by the appellant at the rate of Re 1 per ton on despatches of coke. The rate was subjecte<J. to being revised from time to time by mutual arrangement between the parties ."as .may be justified by market condition." According to the appel)imt the Eastern Coal ComPl¥1Y came to an arrangement in 1950 with him by which royalty on breeze coke was to be paid at the rate of 2 As. per ton. In December 1951 another arrangement was arrived at by which royalty on hard coke was to be paid at the reduced rate of 8 As. per ton instead o~ Re. 1 per ton stipulated in the lease dated May 17, 1946. This arrangement was to be given effect to from July 19, 1952. ·On January, 5, 1955 the Eastern Coal Com s. K. ROY _v._ BHOWllA COLLIER,IES _(Grover,_ J.) 233 #### The Judpent of the Court was delivered by p~ny informed the appellant that the colliery had been sold to E the Bhowra Kankanee Collieries Ltd.-respondent No. 1, the sale being effective from January l, 1955. Respondent No. 1 claimed royalty on all despatches of coke including breeze coke at the rate of Re. 1 per ton. The appellant took up the position that by mutual agreement Eastern Coal Company had agreed to the royalty beirig payable on hard coke at the rate o,f 8 As. per ton and on breeze coke at 2 As. per ton. The appellant F paid to respondent No. 1 the amount calculated 'according to tne above rates. On January 31, 1956 respondent No. 1 instituted a suit against the appellant claiming a sum! of Rs. 23,287-4~3 ~ account of royalty on all l@ds of coke despatqhed during! the G period January 1955 to November 195!5 at the rate of Re. 1 per ton.. The Company further claimed damages at 6% per -annum amounting to Rs. 1212-11-9. The appellant conte~ted the suit, his main plea be~ that by virtue of the 'arrangement arrived at with the Eastern Coal Company in accordance with the terms of the lease dated May 17, 1946 the royalty was payable at the rate of Re. 1 per ton for hard coke and 2 As. per H ton for breefe coke. The trial court accepted the p!ea of the appellant about reduction of the rater. of royalty in terms of the arrangement arrived at with the Eastern Coal Company. It was On January 31, 1956 respondent No. 1 instituted a suit against the appellant claiming a sum! of Rs. 23,287-4~3 ~ account of royalty on all l@ds of coke despatqhed during! the G period January 1955 to November 195!5 at the rate of Re. 1 per ton.. The Company further claimed damages at 6% per -annum amounting to Rs. 1212-11-9. The appellant conte~ted 234 SUPREME COURT REPORTS [1971 )3-S.C.R. further held that the document Exh. A-4 in which this agreement or arrangement was incorporated did not required regis.tration compulsorily and was admissible in evidence. The suit was dismissed. Respondent No. 1 preferred an appeal to the .High Court. Although the point with regard to the admissibility of Exh. A-4 for lack of regiitration was raised before the High Coun it did not give any decision on it. The judgment of the High Court rested .on the finding that the appell~nt had failed to prove that the reduction in the rate of royalty had been given effect to from July 1952. Mr. B. Sen for the appellant sought to raise the question about the admissibility of Exh. A-4 for want of registration. In the first place this contention canlliot be entertained so long as the findin~ of the High Coun on the only point which was canvas.sed before it about the reduction of the rate of royalty is not set aside. The High Court had held after an examination of the e.vidence that it h~d not bee.11 proved that there was ·~ny change in the market condition in July or in December 1953 to call for a reduction in the rate of royalty or that there was any mutual ;irrangeme,nt or agreement betwen the lessor or the lessee for such a reduction which was to become effective from July 1952. No attempt was made by Mr. Sen to persuade us to reverse this c~n­ clusion. Even on the assumption that a mutual arrangement or agreement as evidenced by Exh. A-4 yas arrived at between the appellant and the Eastern Coal Co. Ltd. we are unable to ngree that any reduction in the rate of royalty could liave been effected bv means of Exh. A-4 which had not been registered under the provisions of the Indian Registration Act. It is well settled by now that a document which v·aries the essential terms of the exist ing registered lease; such as the amount of rent, must be regis tered : See _Durga Prasad Singh_ v. _Rajendra Narain Bagchi(')_ which was approved by the Full Bench in _.La/it Mohan Ghosh_ v. _Gopal Chuck Coal Company Ltd.(2)._ The decision of the Mad ras High Court in _Obai Gounden_ v. _Ramalinl(a_ Ayyµr(~) taking a contrary view has not been followed by the High Cou"ts in India and the consist~! view that has been' taken is that registration of an agreement is necessary which reduces the rent of an exist ing registered lease : See Mulla on Indian Registratiorl Act. 7th Edn. pp. 75-76, The other contentions faintly raised before us arising out of issue No. 3 and that Exh. A-4 had been acted µpon do not survive in view of the conclusions arrived at by the High Court and (1l T.L.R. 37 Cal. 293. (2) 1.L.R. 39 Cal. 284. (3) I.LR. nMad. 217. A B ### c D E F G H -~ A B ##### s. K. ROY v. BHOWRA COLLIERIES (Gorver, /.) 235 the view that we have taken about the admissibility of the aforesaid docume.nt. The Civil Miscellaneous Petitions which were filed in this Court shall stand dismissed as, in our opinion, no ground has b.!en made out for admitting additional evidence or for impleading the Oriental Coal Co. Ltd. as a party respondent here. The appeal fails and it is dismissed with costs. G.C. _Apjleal_ _dismissed._