JUDGMENT
Raj Kishore Prasad, J.
1. This Letters Patent Appeal arises on a certificate granted by Misra J., against his judgment dated the 21st April 1954, in Second Appeal No. 1928 of 1949, affirming the judgment and decree of the first court of appeal allowing the plaintiff-appellant compensation amounting to Rs. 700/- in lieu of the encroachment made on his land by the defendants-respondents.
2. The only question, which has been argued by Mr. Lal Narayan Sinha, Government Advocate, appearing for the plaintiff appellant is that on the finding of the court of appeal below that:
“Both the parties were labouring under some sort of mistake about their respective rights in regard to the encroached portion of the land. Somehow, a boundary dispute cropped up long after the appellants’ (that is, the defendants’) construction which progressed for several months without any protest, and then it was found out that there had been an encroachment.”
no question of acquiescence or waiver in law can possibly arise, and, as such, the finding on the question of acquiescence is erroneous in law; rather, it is negatived by the above finding of the court of appeal below itself. As a corollary to his contention, Mr. Sinha has further argued that if his contention is accepted to be correct, then there is no question of awarding compensation in lieu of the encroachment, as such a procedure is not warranted by law.
3-4. In order to appreciate the argument of the learned Government Advocate, it is necessary to know briefly the relevant facts bearing on this question.
5. The plaintiff-appellant brought a suit for removal of an encroachment on survey plot 80, under Khata 15, situate in Sepahilane, in the Gaya town. He also asked for a permanent injunction restraining the defendants from opening windows, service doors of the latrine and drain, and also from discharging the drain eves’ water. Contiguous north of the plaintiff’s plot 80 lies survey plot 83, which is in possession of defendant No. 1 by virtue of purchase.
The plaintiff began to construct compound walls towards the north and east of his plot 80, and, when the construction had reached only 40 feet in length and 6 1/2 feet in height, defendant 1 started a row, whereupon the construction was stopped. The plaintiff, thereafter, got his land measured, and, then, he came to know that the defendants had encroached upon his land, plot 80, to the extent of 9 feet in breadth from north to south and 90 feet in length from east to west.
The defendants began construction of their house on plot No. 83 four or five months before the institution of the present suit, and, in doing so, they made the encroachment in question and also opened window, drain, service-door of latrine etc. The defendants were asked to remove the encroachment, but they did not do so, and, therefore the suit was brought by the plaintiff for the reliefs stated above.
6. The first court decreed the plaintiff’s suit to the extent of 90′ x 5′ only, but, on appeal by the defendants, the decree of the first court was modified to this extent only that the plaintiff was awarded compensation amounting to Rs. 700/- in lieu of the encroachment made on his land, because the learned Subordinate Judge, who heard the appeal, took the view that the plaintiff could not be allowed to demolish the building at this late stage and get vacant possession of the land.
7. The plaintiff, therefore, preferred a second appeal to this court, which was heard by Mr. Justice Misra, before whom the only question canvassed was about the correctness of the decree awarding compensation in lieu of encroachment, Mr. Justice Misra observed that “according to the finding of the learned Subordinate Judge the plaintiff being ignorant of his right, the question of acquiescence cannot properly speaking arise ;
but his Lordship found himself unable to accept the appellant’s contention that, in these circumstances,
“it must necessarily follow that the person,
who has suffered as a result of the construction,
is entitled to the recovery of possession after demolition of the structure built by the other owner.”
In this view, his Lordship upheld the order of the learned Subordinate Judge awarding compensation in lieu of encroachment.
8. In this appeal, therefore, two questions emerge for decision, arising out of the argument of Mr. Sinha: (1) whether on the finding of the first court of appeal, its finding about acquiescence is correct in law? and, (2) if there be no. acquiescence or waiver on the part of the plaintiff, can he in law be awarded a decree for compesation, in lieu of encroachment?.
9. In order to answer the first question, as to whether on the finding of the court of appeal below that both the parties were labouring under some sort of mistake about their respective rights in regard to the encroachment portion of the land, acquiescence has, in law, been proved, It is necessary at first to know the principles underlying the rules of acquiescence or waiver.
It is well established that parties cannot be said to acquiesce in the claims of others unless they are fully cognizant of their right to dispute them, and that, where acquiescence is relied on, it must be shown that the person acquiescing was aware of the matter in which he acquiesced, and of the effect of such acquiescence. Recognition, like waiver, must be an intentional act with knowledge: .– ‘Bhonu Lal Chowdhury v. W.A. Vincent’, AIR 1922 Pat 619 (FB) (A). This principle is further reinforced by a decision of the .Judicial Committee in ‘Premila Devi v. Peoples Bank of Northern India, Ltd’, AIR 1938 PC 284 (B), which followed — ‘Spachkman v. Evans’, (1868) 3 HL 171 (C); and — ‘Irvine v. The Union Bank of Australia’, (1877) 2 AC 366 (D). Lord Romer, in delivering the judgment of the Board, observed that
“there can in truth be no ratification without an intention to ratify, and there can be no intention to ratify ah illegal act without knowledge of the illegality.”
The learned noble Lord further quoted with approval what Lord Chelmsford said in — ‘Spackman v. Evans (C)’, (supra).
“To render valid an act of the directors of a company which is ultra vires, the acquiescence of the share-holders must be of the same extent as the consent which would have given validity from the first, viz., the acquiescence of each and every member of the company. Of course, this acquiescence cannot be presumed unless knowledge of the transaction can be brought home to every one of the remaining share-holders.”
By knowledge of the transaction is clearly meant knowledge of the invalidity of transaction. Prom the principles laid down in the above cases, therefore, it is clear that there can be no acquiescence or waiver in a case where both the parties are unaware of their rights in the disputed property, both are labouring under some mistake about their respective rights in regard to such land.
Unless both are fully cognizant of their right to dispute them, the parties cannot be said to acquiesce in the claims of the other. Where, therefore, acquiescence is relied on, it must be shown that the person acquiescing was aware of the matter in which he acquiesced, and of the effect of such acquiescence. In my judgment, therefore, on the finding, there can be no acquiescence or waiver on the part of the plaintiff.
10. The next crucial question is: is the plaintiff on principles of equity estopped from claiming possession of the disputed land — encroached land — by demolition of the structure on it in view of the fact that both the parties were labouring under some sort of mistake about their respective rights in regard to the encroached portion of the land? What the principles of equity in such a case are can be better ascertained from the leading English case of ‘Ramsden v. Dyson’, (1866) 1 HL 129 (E). In considering what the principles of equity on the subject are Lord Cranworth, the distinguished Lord Chancellor, in his address to the noble Lords observed:
“If a stranger begins to build on my land supposing it to be his own, and I, perceiving his mistake, abstain from setting him right, and leave him to persevere in his error, a Court of equity will not allow me afterwards to assert my title to the land on which he had expended money on the supposition that the land was his own. It considers that, when I saw the mistake into which he had fallen, it was my duty to be active and to state my adverse title; and that it would be dishonest in me to remain wilfully passive on such an occasion, in order afterwards to profit by the mistake which I might have prevented.
But it will be observed that to raise such an equity two things are required, first, that the person expending the money supposes himself to be building on his own land; and, secondly, that the real owner at the time of the expenditure knows
that the land belongs to him and not to the person expending the money in the belief that he is the owner.
For if a stranger builds on my land, knowing it to be mine, there is no principle of equity which would prevent my claiming the land with the benefit of all the expenditure made on it. There would be nothing in my conduct, active or passive, making it inequitable in me to assert my legal rights.”
11. This question of, What is called, ‘building equity’ has been considered by this Bench also in — ‘Kashi Prasad Kutaruka v. Bibi Allay Fatma’, 1956 Pat LR 498: (AIR 1957 Fat 303) (F). My Lord the Chief Justice, who delivered the Judgment of the Court, and with whom I agreed, while considering the effect of Section 191 of the Bihar and Orissa Municipal Act (VII of 1922), observed:
“This section embodies a principle somewhat similar, though not identical, to the equitable principle laid down in — ‘Plimmer v. Wellingtion Corporation’, (1884) 9 AC 699 (G). I have already said, the sanction of the 6th of January, 1951, and the renewal of the sanction on the 2nd of February, 1953, may be illegal in certain respects; but the Patna City Municipality or the Patna Municipal Corporation has no power to revoke these orders after the erection of the building had commenced. The reason is that equitable rights have sprung up in favour of respondent No. 1 and statutory protection has been granted to her against any action on the part of the Patna Corporation or the Patna City Municipality.”
In my opinion, no such building equity has arisen in favour of the defendants, nor any equitable rights sprung up in their favour, which can prevent the plaintiff, in the circumstances of the case, to claim possession by demolition of the building on the encroached portion of his land. In order to raise such an equity in favour of the defendants, the two conditions laid down in the case of ‘Ramsden v. Dyson’, (E) (supra), must be established; but in the present case, none of two conditions which must co-exist is present, because on the finding of the court of appeal below none of the parties knew their respective rights In regard to the encroached land, and, both were labouring under some sort of mistake about their respective right in the said land. Only when the defendants’ construction had progressed for several months, and when a boundary dispute cropped up between the parties, and when the plaintiff measured the land that he learnt that the portion on which the defendants were constructing the building belonged to him, and, immediately thereafter he brought a suit for possession.
The plaintiff’s right to recover the encroached portion arises out of his ownership. It is well established that if a stranger builds on the land of another, believing it to be his own, the owner is entitled to recover the land, and the party building on the land of another is allowed to remove the building unless there are special circumstances amounting to a standing by so as to induce the belief that the owner intended to forego his right, or to an acquiescence in his building on the land. No such special circumstances were found to exist in the present case.
In my opinion, therefore, as no finding of acquiescence of waiver can be founded on the finding of the court of appeal below that both the parties were labouring under some sort of mistake about their respective rights in regard to the encroached portion of the land, the plaintiff is not estopped from claiming vacant possession of the
encroached land by demolition of the building standing thereon.
12. Mr. G.P. Das, for the defendants, in reply on the question of acquiescence, submitted that the plaintiff was estopped from claiming possession of the land under Section 115 of the Indian Evidence Act.
12a. Estoppel is a rule of evidence, and the general rule is enacted in Section 115 of the Evidence Act. This is a rule of estoppel by conduct as distinguished from record which constitutes the bar of res judicata. The exposition of the rule of estoppel embodied in Section 115 of the Indian Evidence Act by Lord Shand in “Sarat Chunder Day v. Gopal Chunder Laha’, 19 Ind App 203 at page 215 (H), may be quoted in extenso. This principle was followed in ‘Sir L.E. Ralli v. A.R. Forbes’, AIR 1922 Pat 258; ILR 1 Pat 717 (I), which was affirmed on appeal by the Judicial Committee in ‘A.H. Forbes v. Sir L.E. Ralli’, 52 Ind App 178: (AIR 1925 PC 146) (J), in which their Lordships of the Judicial Committee recorded their full concurrence with the principle laid down there. Lord Shand observed:
“The law of this country gives no countenance to the doctrine that in order to create estoppel the person whose acts or declarations induced another to act in a particular way must have been under no mistake himself, or must have acted with an intention to mislead or deceive. What the law and the Indian Statute mainly regard is the position of person who was induced to act, and the principle on which the law and the statute rest is, that it would be most inequitable and unjust to him, that if another, by a representation made, or by conduct amounting to a representation has induced him to act as he would not otherwise have done, the person who made the representation, should be allowed to deny or repudiate the effect of his former statement, to the loss and injury, of the person who acted oh it.
If the person who made the statement did so without full knowledge, or under error, sibi imputet. It may, in the result be unfortunate for him, but it would be unjust, even though he acted under error, to throw, the consequences on the person who believed his statement and acted on it as it was intended he should do.”
The doctrine will apply, that if a man, either by words or by conduct, has intimated that he consents to an act which has been, done, and that he will offer no opposition to it, although it could not have been lawfully done without his consent, and, he thereby induces others to do that from which they otherwise might have abstained, he cannot question the legality of the act he had so sanctioned, to the prejudice of those who have so given faith to his words or to the fair inference to be drawn from his conduct.
This general principle Is thus stated by the learned Lord Chancellor (Lord Campbell), with the full concurrence of Lord Kingsdown, in the case of — ‘Cairncross v. Lorimer’, (1860) 3 Macq 827 at 829 (K), which was quoted with approval by Lord Shand in ‘Sarat Chunder Day v. Gopal Chunder Laha’, (H) (supra). In my opinion, therefore, generally speaking if a party having an interest to prevent an act being done has full notice of its having been done, and , acquiesces in it, so as to induce a reasonable belief that he consents to it, and the position of others is altered by their giving credit to his sincerity, he has no more right to challenge the act to their prejudice than he would have had if it had been done by his previous license. An estoppel does
not itself give a cause of action, it prevents a person from denying a certain state of affairs.
13. In the present case, however, the finding is that both the parties were labouring under some sort of mistake about their respective rights in regard to the encroached portion of the land till after the construction by the defendants upon the encroached portion had progressed for several months without any protest from the plaintiff, and that the plaintiff learnt about the encroachment only when there was a boundary dispute and the land was measured.
In such circumstances, it cannot be said that the defendants were induced by any act or declaration of the plaintiff to act in a particular way. In order to attract the principle of estoppel, it Is essential that the person against whom the doctrine of estoppel is sought to be applied must have made some representation, or by his own conduct amounting to representation, must have induced the other party to act as otherwise he would not have done. In the present case, on the finding, there is no such case made out at all.
In my opinion, therefore, the plaintiff cannot be said to be estopped from asking for possession by demolition of the building standing on his land.
14. I would, therefore, answer the first question in the negative by saying that on the finding of the first court of appeal, the finding of acquiescence is erroneous in law, and that no acquiescence has been established in the eye of law. As a result of my decision on the question of acquiescence, the plaintiff is entitled to recover possession of the disputed land after demolition of the structure built on the encroached portion of the plaintiff’s land, and in this respect the decision of Mr. Justice Misra must be reversed, and, the plaintiff must be given a decree for possession; and the defendants must be asked to remove the encroachment upon the encroached portion of plot No. 80 and restore it to its original condition.
15. The next important question for consideration is, is the decree for compensation in lieu of the ejectment, awarded by the first court of appeal, which has been affirmed by Mr. Justice Misra, correct in law? In my opinion such a decree is contrary to law. When the first court of appeal found in agreement with the first court, that the land in question belonged to the plaintiff, such being the findings as to the property in the land, the courts could not compel the plaintiff to part with his legal rights and accept compensation against will, howsoever reasonable it might appear to be.
A similar question came up for consideration before the Bombay High Court in two cases, –Govind Vankaji Kulkarni v. Sadashiv Bharma Shet’, ILR 17 Bom 771 (L.); and — Jethalal Hirachand v. Lalbhai Dalpatbhai’, ILR 28 Bom 298 (M). In the latter case, in which the first case was affirmed, Chandavarkar J., while considering the finding of the learned District Judge that the plaintiff was entitled to no more than compensation, because there has been on the part of the defendant a technical encroachment in as much as a foot, or so of the plaintiffs ground had been taken to support the wall which divided the properties of the parties observed:
“But if the foot or so of ground so taken by the defendant belongs to the plaintiff the act of the defendant is one of continuous trespass on the plaintiff’s property and the wrongdoer cannot be heard to say that he has deprived the owner
of only a little and that of not much use to the latter. To allow such a defence and on the strength of it to award compensation is to let a trespasser put a value of money’s worth on another man’s property and deprive him of it against his will.”
His Lordship went on further to observe:
“But where a man builds on another man’s property against the will of the latter or without his consent, the invasion, is practically one where pecuniary compensation cannot be regarded as adequate relief. The owner is, in such a case, not only deprived of the property but he is also deprived permanently of such user of it as he is entitled to make. How are the damages to be estimated in such a case and how can it be said that an award of compensation can do justice to the owner who leases the property, and all opportunity besides of using it for purposes which he may consider profitable, or beneficial to himself.”
His Lordship for the above principle relied on the principle enunciated by Lord Selborne L. C. in — Goodson v. Richardson’, (1874) LR 9 Ch 221 (N). I respectfully agree with his Lordship Chandavarkar J., with his above statement of law on the subject, and consider that his Lordship has laid down the correct statement of law on the point. Belief by way of compensation in such a case is tantamount to allowing a trespasser to purchase another man’s property against that man’s will.
On no principle of law or equity is that allowable. In my opinion therefore, the second question posed by me must also be answered in the negative by saying that the plaintiff cannot in law or equity be awarded compensation in lieu of ejectment to which he is legally entitled. His right to recover the encroached land arises out of his ownership and he is not estopped, either by acquiescence or waiver, or estoppel by conduct, from claiming his right to possession.
16. For the reasons given above, I would reverse the decision of Mr. Justice Misra, and also of the learned Subordinate Judge and, set aside the judgment and decrees of both, and, restore those, of the learned Additional Munsif dated the 18th March, 1949, and decree the plaintiff’s suit for possession on the same terms and conditions as stated in the Judgment of the first court but only with this modification that the defendants will be entitled to remove the structure standing on the encroached land and, they will be required to restore it to its original condition, within six months from today failing which the plaintiff will be entitled to get possession by removal of the encroachment upon the portion of his plot No. 80 through court at the cost of the defendants.
17. In the result, the appeal succeeds and is allowed but in view of the peculiar circumstances of the present case, the plaintiff will not be entitled to any cost either of this Court, or of any of the three Courts below.
Ramaswami, C.J.
18. I agree.