SHIBA PRASAD SINGH Vs. MAHARAJA SRISH CHANDRA NANDI

JUDGEMENT

(1.) THE appellant is the owner of the Jharia estate. In 1898 his predecessor granted a mining lease of a part of that estate to the predecessor of respondent No.1. THE terms of that lease are set out in a kabuliyat of October 22, 1898, which begins: "this kabuliyat regarding Mourushi Mukarrari, i. e. permanent settlement on commission of coal land is executed to the following effect. " THE provision, the meaning of which is in dispute in the present litigation, is as follows : 1. That for the quantity of coal which I shall raise from the leasehold entire 1103 bighas 18 kathas of coal land of Ekra I shall pay commission, i. e. , royalty on steam coal, rubble coal, hard coke and soft coke at the rate of 3 annas per ton and for rubble and dust for burning bricks at 1 anna 6 pies per ton. Be it stated that I shall pay royalty at the present fixed rate for the coals, which will be despatched by the East Indian Railway line, But in future if the Bengal Nagpur. Railway line is constructed and the freight of coal becomes less by 2 annas at least or more than what is fixed at present per ton, I shall pay royalty for those coals, which shall be despatched in the aforesaid manner at the said reduced freight, at 5 annas per ton on steam, steam rubble, soft coke and hard coke and 2 annas 6 pies per ton on rubble and dust for burning bricks. But if the said railway freight becomes less than 2 annas per ton, the amount which will be reduced will be enhanced on the rate of royalty at present fixed on steam, steam rubble, soft coke and hard coke and enhanced by half thereof on rubble and dust for burning coal.

(2.) THERE follows a number of other provisions for an annual minimum royalty, for interest, for hypothecation of the tenant's property at the colliery and for other matters which need not be further referred to at this point.

(3.) THE contentions of the parties had been clearly stated. THE lessor contended that once the higher rate of royalty had come into operation, it was permanent and not affected by a subsequent rise in the rate of freight. On this view there had been no overpayment and royalties were still payable at the higher rate. THE lessee on the other hand maintained that on a true construction of the lease the higher rate of royalty was only payable on coal despatched by rail at a freight more than 2 annas below the freight at the date when the lease was entered into. On this view the higher rate of freight ceased to operate on April 1, 1921. By continuing to pay at the higher rate from that date until September 30, 1923, he had paid Rs. 63,680 more than was due, and he was entitled to retain future royalties up to this amount and thereafter to pay at the lower rates. THE lessee acted on this view of his rights. He made no further payment of royalties until August 20, 1925, and from that date onwards he continued to pay royalty at the lower rates.