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Ramchandra Vithal Bhat Vs. Gajanan Narayan Deshmukh and ors. - Court Judgment

LegalCrystal Citation
CourtMumbai
Decided On
Judge
Reported in56Ind.Cas.349
AppellantRamchandra Vithal Bhat
RespondentGajanan Narayan Deshmukh and ors.
Excerpt:
.....to which he acquired a title under the sale certificate and that if he failed to do so, his present suit would be barred. taking the meaning of the expression 'cause of action' most favourable to the defendants' contention, i am satisfied that the cause of action in the present case is not the same as that in the suit of 1910 and that rule 2 of order ii presents no bar to the maintainability of the present suit. the certificate of sale was good title until set aside in regular proceedings. the general proposition of law has clearly been wrongly stated by the lower appellate court. it would appear to me, therefore, no good reason for treating the sale as a nullity, whether or no it was open to the defence to raise the plea of fraud in view of the provisions of article 166 of the..........of certain survey numbers which were in the possession of those defendants. to that suit the present defendants nos. 2 and 3 were joined as parties, but they bad nothing to do with the lands then in suit. in that suit it was found that the plaintiff was not a benamidar for the original mortgagee and decree-holder, and that the lands then in suit were covered by the sale certificate. accordingly a decree was passed in his favour for possession of the lands, and that was upheld by both the appellate courts in appeals preferred by the defendants in that case who were in possession of the lands then in suit. the plaintiff filed the present suit in 1914 against defendants nos. 2 and 3, alleging that the 1st defendant who was the tenant of defendants nos. 2 and 3 was really in occupation.....
Judgment:

Shah, J.

1. It will be convenient to set forth the facts which have given rise to this second appeal.

2. One Narayan and his other brothers mortgaged a two-anna share in the Khoti Takshim to one Vinayak Tilak with all the Khasgi lands and other rights appertaining to the Takshim. The mortgagee filed Suit No. 194 of 1902 on his mortgage and obtained a decree. In pursuance of that decree the property mortgaged was sold by the Court and the present plaintiff purchased it at the Court sale on the 16th June 19C8 for Rs. 1,200. The tale was confirmed in July 1908. The auction purchaser applied to have possession of the property and be recovered possession in December 1903 of the Tekshim. It was stated, however, at the time by him that certain properties to which the sale certificate related were in the actual possession of the defendants and that be had not received possession of those properties. Those properties were not specified; but generally speaking, the main property described in the sale certificate, viz., the Khoti Takshim, was taken possession of under Section 319 of the Code of Civil Procedure which was then in force. The present plaintiff filed Suit No. 118 of 1910 against some of the defendants to the mortgage suit for possession of certain Survey Numbers which were in the possession of those defendants. To that suit the present defendants Nos. 2 and 3 were joined as parties, but they bad nothing to do with the lands then in suit. In that suit it was found that the plaintiff was not a Benamidar for the original mortgagee and decree-holder, and that the lands then in suit were covered by the sale certificate. Accordingly a decree was passed in his favour for possession of the lands, and that was upheld by both the Appellate Courts in appeals preferred by the defendants in that case who were in possession of the lands then in suit. The plaintiff filed the present suit in 1914 against defendants Nos. 2 and 3, alleging that the 1st defendant who was the tenant of defendants Nos. 2 and 3 was really in occupation of the land in suit at the date when he recovered possession in 1908 under the sale certificate and that subsequently he had transferred possession wrongfully to defendants Nos. 2 and 3. Defendant No. 1 did not claim any interest in the property, and defendants Nos. 2 and 3 contended that the land in suit was not included in the sale certificate, that it was a Khoti Kulargi land, that the plaintiff was a Benamidar for the original decree holder and that the suit was barred under Order I), rule 2, by the previous Suit No. 118 of 1910. The trial Court came to the conclusion that the plaintiff was not a Benamidar and that he was entitled to recover possession of the lands in suit, as the terms of the sale certificate were sufficient to convey the lands to the plaintiff. The objection based on rule 2 of Order II of the Code of Civil Procedure was overruled, with the result that a decree was pasted in favour of the plaintiff. The defendants Nos. 2 and 3 appealed to the District Court. That Court came to the conclusion that the plaintiff was a Benamidar for the original decree holder, that the latter was a necessary party to the suit, and that the present suit was not maintainable. The learned District Judge accordingly dismissed the plaintiff's suit with costs throughout. The plaintiff has appealed to this Court.

3. The appeal has been argued before us on the footing that the plaintiff is a Benamidar for the original mortgagee and the decree-holder, as found by the lower Appellate Court. It is also now common ground between the parties that the land in suit, though not expressly mentioned in the sale certificate, is included therein, and that the purchaser has a title under the sale certificate to the land in suit as he has to the two-anna Takshim.

4. The first question that arises in this appeal is whether the lower Appellate Court is right in holding that the original mortgagee was a necessary party to the suit and that in his absence the plaintiff could not maintain the suit. It is clear, in my opinion, that the original mortgagee, for whom the plaintiff is supposed to have purchased the property at the Court sale, is not a necessary party and that the plaintiff, though a Benamidar, can sue in his own name to recover the property vested in him as a Benamidar.

5. The judgment in Gur Narayan v. Sheo Lal Singh 49 Ind. Cas. 1 : 46 I.A. 1: 17 A.L.J. 66 : 36 M.L.J 68 : 9 L.W. 335 : 23 C.W.N. 521 : 1 U.P.L.R. (P.C.) : 46 C 566 : 12 B.L.T. 122 is a clear authority in favour of thin view. Their Lordships observe at page 9 Page of 46 I. A.--Ed. of the report that 'so long, therefore, as a Benami transaction does not contravene the provisions of the law, the Courts are bound to give it effect. An already observed, the Benamidar has no beneficial interest in the property or trashes that stands in his name; he represents, in fact, the real owner, and so far as their relative legal position is concerned he is a mere trustee for him. Their Lordships find it difficult to understand why, in such circumstances, an action cannot be maintained in the name of the Benamidar in respect of the property, although the beneficial owner is no party to it. The buik of judicial opinion in India is in favour of the proposition that in a proceeding by or against the Benamidar, the person beneficially entitled is fully affected by the rules of res judicata. With this view their Lord-ships concur. It is open to the latter to apply to be joined in the action; bat whether he is made a party or not, a proceeding by or against his representative in its ultimate result is fully binding on him.' This was a case of a private Benami purchaser. But, in my opinion, it makes no difference that in the present case the plaintiff is a purchaser at a Court sale. In the case of Ravji Appai v. Mahadev Bapuji 22 B. 672 : 11 I. D 1030 Mr. Justice Ranade, after reviewing the various reported oases, summed up as follows: 'This review of the authorities shows clearly that appellant No. 1 as benami purchaser had full right to bring the suit. If the true owner holds back, a decree against the Banamidar owner would bind him as res judicata. The present suit was, therefore, properly instituted. The addition of appellant No. 2's name made no difference in the character of the suit.' This was said with reference to a case in which the plaintiff was a purchaser at a Court sale

6. It is urged, however, on behalf of the respondents that this rule holds good so long as the Benami transaction does not contravene the provisions of the law and that in the present case the provisions of Section 294 of the Code of 1882 have been contravened, in so far as the decree holder did not obtain any leave to bid for or purchase the property. It seems to me that the omission on the part of the mortgagee to obtain such a leave does not render the purchase by the Benamidar invalid or unlawful. It is clear that so far as the, apparent title of the Benamidar is concerned, the sale, when it has been confirmed, has the effect of vesting the property in the purchaser and that under Section 66 of the present Code of Civil Procedure and the corresponding provisions of the Code of 1882 even the real owner cannot maintain a suit against the Court purchaser. Farther, Section 294 of the Code of 1882 and the corresponding provisions in the present Code show that the omission on the part of the decree holder to obtain the necessary leave has not the effect of tendering the Benami purchase void; but such a purchase is liable to be set aside. It is an admitted fact in this case that none of the defendants in the mortgage suit applied under Section 294, paragraph 3, to have the sale set aside. The application for setting aside a sale under that paragraph could have been made within the period prescribed by the law of limitation. No such application was made, and having regard to the fact that the original mortgagors were all brothers and that some of the defendants, who were parties to the suit of 1910, bad specifically raised the point that the plaintiff was a Benamidar for the original decree holder, it cannot be said that the defendants were really ignorant of any fact which could have prevented them from making a proper application for setting aside the sale. There is no allegation in the present case that the defendants were ignorant of the real nature of the purchase by the plaintiff during all the time preceding the present suit. The rule certificate, therefore, must be taken as a valid certificate giving the plaintiff a title to the land in suit which he is entitled to enforce.

7. It is farther urged that though the present defendants Nos. 2 and 3 may not be in a position to have this sale set aside by a proper application under paragraph 3 of Section 294 or under the corresponding provisions in the present Code on account of the bar of limitation, it is open to them to plead by way of defence that the title of the plaintiff is vitiated by fraud. In support of this contention reliance is placed upon Rangnath Sakharam v. Govind Narasinv 28 B. 639 : 6 Bom.L.R. 592 and Minalal Shadiram v. Kharssetji Jivaji 30 B. 395 : 8 Bom.L.R. 296. It is not necessary in this case to express any opinion as to whether such a plea could be raised by way of defence, though any suit based on that ground would be time barred. Assuming in favour of the defendants that such a defence is open to them, it seems to me that on the merits that defense must fail. In the first place, no such plea of fraud was raised in the written statement; and the only fraud suggested in the argument before us is that the property which was roughly valued at Rs. 1,500 fetched only Rs. 1,200 at the Court sale. In my opinion this is no fraud whatever. In the first place there is nothing to show that the property was really worth Rs, 1500: it only shows that in execution proceedings the Court had estimated the value at that figure, and the difference between the estimated value and the price actually realized is not so great as to indicate any kind of fraud on the part of the decree-holder or any other person. In connection with this point the learned Pleader for the respondents relied upon the case of Thathu Naick v. Kondu Reddi 1 Ind. Cas. 221 : 32 M. 242 : 5 M.L.T. 248. The facts of that case were quite different, and I do not see how that case could be treated as an authority in favour of the view that in the present case the fact of the property having fetched Rs. 300 less than its estimated value amounts to fraud.

8. It is urged in support of the decree of the lower Appellate Court on behalf of the respondents that the present suit is barred under rule 2 of Order II. The contention is that the plaintiff should have included in the suit of 1910 his claim for the possession of all the properties to which he acquired a title under the sale certificate and that if he failed to do so, his present suit would be barred. It is urged that the plaintiff having omitted to sue in respect of the property now in suit in 1910, he cannot now sue in respect thereof. The question is whether the cause of action in the present suit is the same as that in the previous suit. Several oases have been cited in the argument in connection with this point; but I do not consider it necessary to refer to these oases. The point, it seems to me, must be decided with reference to the facts of this case. It is clear that the cause of action in the present suit cannot be treated as the same as that in the previous suit. The plaintiff no doubt acquired a title to several properties under a general description of the Khoti Khasgi lands under one and the same sale certificate. But his cause of action in respect of the lands in the possession of different persons cannot be treated as the same. It was open to him to have sued the several defendants in possession of the different lands including the present defendants in the suit of 1910; but I do not think that the plaintiff was bound to do so. The property in this suit is different. The parties in possession sued now are different, and the cause of action alleged is a' different. For the purposes of this point however, I assume that the cause of action 1 simply that the defendants have withheld possession from him although he is entitled thereto under the sale certificate, and to leave out of consideration the special allegations which the plaintiff has made. With regard to these special allegations as to the land being in the possession of defendant No. 1 and the possession having been subsequently transferred by defendant No. 1 to defendants Nos. 2 and 3, the trial Court found in favour of the plaintiff and the Appellate Court does not seem to me to have recorded any specific finding on that point. In the view I take of the case, I consider this allegation to be immaterial and it is not necessary to have any finding on that question. Assuming that there was no intervention of defendant No. 1 and the position of defendants Nos. 2 and 3 was throughout as I have stated it, I think that the cause of action would not be the same as that in the suit of 1910 in which different properties were involved and different defendants were in possession of the properties in that suit. The evidence in the present case may be similar, but it cannot be said to be identical. Besides the plea raised by the defendants that the land in suit is Kulargi land shows that the evidence in this suit must be different. Taking the meaning of the expression 'cause of action' most favourable to the defendants' contention, I am satisfied that the cause of action in the present case is not the same as that in the suit of 1910 and that rule 2 of Order II presents no bar to the maintainability of the present suit.

9. It remains only to notice the point which has been made by the lower Appellate Court but which has not been pressed before us. The learned Judge has held, relying on Sadashiv v. Narayan 11 Ind. Cas. 987 : 35 B. 452 : 13 Bom.L.R. 66, that the proper remedy of the plaintiff is not a suit but an application in execution under Section 47 of the Code of Civil Procedure. That was, however, a case in which the decree-holder himself was the purchaser. The view taken in that case has not been applied to a case in which the decree holder himself is not the purchaser bat where a third person has purchased Banami for him. For the purposes of procedure the auction-purchaser, even though a Benamidar for the decree-holder, is a third party. The ruling in Sadashiv v. Narayan 11 Ind. Cas. 987 : 35 B. 452 : 13 Bom.L.R. 66 really can apply to a case where the decree-holder himself is the purchaser at the Court sale. The present suit is a suit by an auction-purchaser, who is not the decree-holder for the purposes of procedure and who is, therefore, entitled to sue to recover possession of the property which he has purchased.

10. In my opinion, therefore, this appeal should be allowed, the decree of the lower Appellate Court reversed and that of the trial Court restored with costs here and in the lower Appellate Court on defendants Nos. 2 and 3.

Hayward, J.

11. I concur. I have no doubt that the Benamidar was entitled to sue. The certificate of sale was good title until set aside in regular proceedings. The general proposition of law has clearly been wrongly stated by the lower Appellate Court. It would be sufficient to refer to the Privy Council case of Gur Narayan v. Sheo Lal Singh 49 Ind. Cas. 1 : 46 I.A. 1 : 17 A.L.J. 66 : 36 M.L.J 68 : 9 L.W. 335 : 23 C.W.N. 521 : 1 U.P.L.R. (P.C.) : 46 C 566 : 12 B.L.T. 122. But it has been argued that the Benamidar had no permission to bid at the sale and that it was, therefore, a nullity.

12. But no steps were taken to avoid the sale as they might have been in execution on that account, nor was it alleged in the written statement that there was any fraud. It was not even alleged in the first Appeal Court. It has, as a final resource, been alleged here, but it has, in my opinion, not been established. It would appear to me, therefore, no good reason for treating the sale as a nullity, whether or no it was open to the defence to raise the plea of fraud in view of the provisions of Article 166 of the Schedule of the Indian Limitation Act.

13. It has been somewhat difficult to follow the line of reasoning in the remainder of the judgment of the first Appeal Court. The learned Judge devoted a material part of his judgment to the proposition not raised as an issue, that the real remedy for recovering possession was by execution and not by way of suit, and he held that there was no real possession recovered in execution and apparently (the point was not clearly stated) that there was no remedy left by suit. But he did not explain precisely why even in default of recovery of possession in execution there should not have been a regular suit to recover possession upon the title-deed, that is to say, the certificate of sale of the Court.

14. The learned Judge held, on the other hand, on the issue raised that there was no bar to the suit under Order II, rule 2, of the First Schedule of the Civil Procedure Code. But be has not given, so far as it would appear from the judgment, any reasons for that conclusion. It would appear to me, however, to have been correct. For he has found as a fact that the previous suit was to recover possession of different properties from different defendants. If that were so, it was, in my opinion, clear that recourse could not be had to Order IT, rule 2, of the First Schedule of the Civil Procedure Code. My detailed reasons for holding this need not be further stated us they have already been given in the case of Sonn Khushal Khadake v. Bahinibai Krishna 33 Ind. Cas. 950 : 40 B. 351 : 18 Bom.L.R. 545.

15. It seems to me, therefore, that we ought to restore the decree of the trial Court and reverse that of the first Appeal Court.


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