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Pandurang Balaji Apte Vs. Mahadeo Gopal Jog - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMumbai
Decided On
Case NumberFirst Appeal No. 293 of 1920
Judge
Reported in(1921)23BOMLR1000
AppellantPandurang Balaji Apte
RespondentMahadeo Gopal Jog
DispositionAppeal allowed
Excerpt:
.....independent of the provisions of the transfer of property act 1882, that where one party to a contract of sale enters into possession of the property before the whole price has been paid, he is ordinarily liable to pay interest on the unpaid purchase money from the date when ho enters into possession.;ratanlal chunilal v. municipal commissioner for the city of bombay(1918) i.l.r. 43 bom. 181; 21 bom. l.r. 114 p.c., applied. - - but if, as happened in this case, the purchaser gets possession without paying the whole of the purchase price, then it follows in equity that he cannot retain the money and also enjoy the profits of the property. 5. now it may very well be that facts can be proved which would disentitle the vendor to receive more than the balance of the purchase money. and..........act. if the ordinary course is followed, the vendor executes the sale-deed, the purchaser pays the sale price and gets possession. but if, as happened in this case, the purchaser gets possession without paying the whole of the purchase price, then it follows in equity that he cannot retain the money and also enjoy the profits of the property.4. the learned judge in the lower court has recognized this principle, but considered on the facts of the case that the plaintiff had deprived himself of the advantages which should accrue from this equitable principle owing to his conduct.5. now it may very well be that facts can be proved which would disentitle the vendor to receive more than the balance of the purchase money. but it seems to me that in considering the facts of the case the learned.....
Judgment:

Norman Macleod, Kt., C.J.

1. The plaintiff filed this suit to recover the balance of the purchase money due on a contract of sale dated the 8th November 1915, whereby he contracted to sell certain property for Rs. 6,000 to the father of the defendants. In pursuance of the contract, the possession of the suit land was given to the defendants' father on the 7th December 1915, but no sale deed was passed owing to the illness of the defendants' father. Thereafter disputes arose with regard to the payment, with the result that the defendants, according to the plaintiff's case, only paid Rs. 1,750. The plaintiff, therefore, claimed Rs. 5,362-7-6 according to the account in the plaint together with further interest at seven and a half percent, on Rs. 4,250.

2. The defendants raised various defences, but the principal question in the suit was whether the plaintiff was entitled to interest on the unpaid balance of the purchase money. The lower Court has decided this question against the plaintiff, and directed the defendants to pay Rs. 4,30l-34-9 into Court, and to produce a general stamp of Rs. 60; on that being done the plaintiff was to pasis a regular sale-deed to the defendants.

3. In appeal it has been argued that the decision of the lower Court on the question of interest was wrong. The decision of the Privy Council in Ratanlal Chunilal v. Municipal Commissioner for City of Bombay I.L.R (1918) Bom. 181, 21 Bom. L.R. 114, P.C. lays down at p. 200 the general principle, which applies when one party to a contract of sale enters into possession of the property before the whole of the price has been paid, that ' unless there be something in the contract of parties which necessarily imports the opposite, the date when one party enters into possession of the property of another is the proper date from which interest on the unpaid price should run. On the one hand, the new owner has possession, use. and fruits; on the other, the former owner, parting with these, has interest on the price.' That is a principle of equity, and it is quite independent of the provisions of the Transfer of Property Act. If the ordinary course is followed, the vendor executes the sale-deed, the purchaser pays the sale price and gets possession. But if, as happened in this case, the purchaser gets possession without paying the whole of the purchase price, then it follows in equity that he cannot retain the money and also enjoy the profits of the property.

4. The learned Judge in the lower Court has recognized this principle, but considered on the facts of the case that the plaintiff had deprived himself of the advantages which should accrue from this equitable principle owing to his conduct.

5. Now it may very well be that facts can be proved which would disentitle the vendor to receive more than the balance of the purchase money. But it seems to me that in considering the facts of the case the learned Judge has erred in coming to the conclusion that the plaintiff has acted in such a way that 1821 he should not be allowed the benefit of the equity which he would otherwise be entitled to. After reading carefully the reasons which have been given by the learned Judge, it seems to me that that is not the view which should be taken. Various circumstances occurred to cause the delay in the parties settling the payment of the balance of the purchase money. I cannot think that the conduct of the plaintiff was so blameable as to justify the language of the learned Judge who says ' to allow the plaintiff interest would be to allow him to take advantage of his own wrong.'

6. The basis of the principle laid down by the Privy Council is hat the purchaser in possession and enjoying the fruits of the property should not at the same time be enjoying the use of the unpaid price, unless it can be shown that the parties have contracted to that effect; and admittedly in this case there was no contract that the purchaser should enjoy the interest on his moneys as well as the profits of the property. This is one of the cases in which there has been delay from one cause or another in the completion of the purchase. Though the vendor may have been responsible for some of the delay, yet it cannot be said that his conduct has been wrongful so as to deprive him of the benefit of the equitable principle to which I have referred. I think, therefore, that the appeal must be allowed, and the plaintiff must be entitled, in addition to the amount directed by the order of the lower Court, to interest at five per cent. On Rs. 4,250 from the 7th December 1915. Interest to be calculated up to the date of payment by the defendant The appellant will be entitled to his costs of the appeal to the extent of the amount he has succeeded in getting.

Shah, J.

7. I agree. I desire to add a word with reference tar the argument urged by Mr. Shingne that under Section 55, Sub-section 5, Clause (b), of the Transfer of Property Act, the purchaser was not bound to tender and pay the amount due until the completion of the sale. But Sub-section 4, Clause (a) of that section provides that the seller is entitled to the rents and profits of the property till the ownership of the property passes to the buyer. The ownership does not pass to the buyer under the Transfer of Property Act until a registered Conveyance is executed by the vendor. It is clear, therefore, that the vendor would be entitled to the rents and profits of the property practically until the date of the payment of the money as no registered conveyance was executed up to the date of the decree. The interest claimed by the plaintiff in this suit is really in lieu of rents and profits to which under the Transfer of Property Act he is clearly entitled in the absence of any contract to the contrary.


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