1. The original suit out of which this appeal arises was filed in a representative capacity, for a declaration that the plaint schedule property belongs to the people of the village of Marase and that the alienation by the defendants does not bind the plaintiffs and for possession of the same together with mesne profits. The Munsiff dismissed the suit while the Subordinate Judge allowed the appeal and decreed the suit. The 5th defendant who is now in possession of the property and who is the third alienee has preferred this appeal against that judgment.
2. The evidence adduced in the case is conclusive that the property belongs to the villagers of Marase and the same was purchased originally by defendant 1 for and on behalf of the villagers. The documents produced in the case especially the khirdi extract (Ex.- C) and the khatha extracts (Exs. D and E) clearly show that the khatha stands in the name of defendant 1 for and on behalf of the villagers while the admission of defendant 1 himself in Ex, A which is the hypothecation deed executed by him in favour of P. W. 1 to the effect that the schedule property belongs to the villagers, leaves no doubt in the matter.
3. The main dispute in the suit centres round the point whether the alienation by defendant 1 in favour of defendant 2 or the alienations subsequently effected were acquiesced in by the people of Marase village. The oral and documentary evidence that has been adduced in the case does not justify any such conclusion of acquiescence; for one thing, the sale deed Ex. II executed by defendant 1 in favour of defendant 2 is attested only by few of the villagers who cannot be said to represent the whole body of the villagers. Besides, the village, panchayath which is admitted to be in existence in that village and which may be taken as representing the majority of the people of the village, has neither been consulted nor has joined in the execution of the document. The view therefore that the alienation by defendant 1 in favour of defendant 2 was acquiesced in by the people of the village cannot be countenanced.
Mr. V. Krishnamurthy, the learned Counsel for the appellant has strenuously argued that defendant 2 was in possession of the schedule property for a period of 4 or 5 years after the sale in his favour, that the villagers did not protest and that this conduct on their part goes to show that there was a clear acquiescence on their part and operates by way of estoppel against them. In support of his contention he relied on 'Ramsden v. Dyson', (1866) 1 H.L. 129 and 'Willmott v. Barber'. (1880) 15 Ch. D. 96. In the latter case Fry J. points out that five conditions should be fulfilled before the doctrine of estoppel can apply. When A stands by while his right is being infringed by B the following circumstances must exist in order that the estoppel may be raised against A.
(i) B must be mistaken as to his legal rights. If he is aware that he is infringing the rights of another he takes the risk of the rights being asserted.
(ii) B must expend money or do some act on the faith of his mistaken belief. Otherwise he does not suffer by A's subsequent assertion of his rights.
(iii) A must know of his own rights. Acquiescence is founded on conduct with a knowledge of one's own legal rights.
(iv) A must know of B's mistaken belief. If he has that knowledge it is inequitable for him to keep silent and allow B to proceed in his mistake, but if he has not that knowledge, there is nothing which calls upon him to assert his own rights and
(v) A must encourage B in his expenditure of money or other act directly or by abstaining from asserting his legal rights.
As Cotton L. J. observed in 'Russell v. Watts', (1884) 25 Ch. D. 559 at p. 576:
'The doctrine as to a person lying by so as to create an equity against him arises, if either he does something from which it can reasonably be inferred that he induced the other persons to think that he would raise no objection to what they were doing; or if he knows facts which are unknown to the other persons acting in violation of the right which these facts give and does not inform them about it but lies by and lets them run into a trap'.
4. In the present case all these conditions are not fulfilled. After all, the schedule property belonged to the village community. The villagers might have thought that the persons in possession were in management of the property on behalf of the villagers or in the capacity of tenants by suffrage. The fact that defendant 2 and subsequently defendants 3 and 5 were in possession of the schedule property does not in any way affect the rights of the villagers. There is nothing on record to show that the villagers 'encouraged', as Justice Fry puts in in 'Willmott v. Barber', (1880-15 Ch. D. 96) quoted above, the alienees in expenditure of money or 'let them run into a trap' as Lord Justice Cotton observed in 'Russel v. Watts', (1884) 25 Ch. D. 559.
5. The counsel for the appellant has relied on the equitable maxim that he who seeks equity must do equity embodied in Section 51 of the Transfer of Property Act. For the section to apply and a claim to compensation to arise improvements to the property must have been made by a transferee who believed in good faith that he was absolutely entitled to the property. A trespasser cannot have the benefit of the section.
6. In 'Secretary of State v. Dugappa' : AIR1926Mad921 Phillips J. observed:
'Negligence may in certain circumstances be consistent with honesty'.
Mr. V. Krishnamurthy learned counsel for the appellant urged that his client, defendant 5, effected the improvements under the mistaken belief that he was absolutely entitled to the property and that his conduct may at the worst be regarded as negligent not however inconsistent with honesty and that he is therefore entitled to the cost of the improvements effected by him. This contention is not wholly without force. The Court has to consider all the circumstances of the case in order to decide in what way equity can be satisfied. In the present case it is undisputed that defendant 5 did effect some improvements to the schedule land. The two Courts below have variously estimated the cost and extent of the improvements made. The trial Court has evaluated the improvements at Rs. 800/- while the appellate Court has inclined to the opinion that the cost of improvements does not go beyond Rs. 400/- or Rs. 500/-. It may be taken for granted that the Courts below are agreed that the cost of improvements is at any rate not less than Rs. 400/-. Taking the evidence as a whole, I am inclined to allow a sum of Rs. 400/- as being the cost of improvements effected.
In assessing the value of improvements for the purpose of payment of compensation the Privy Council observed in 'Kidar Nath v. Mathu Mal', 40 Cal. 555 P. C. thus:
'It is to be borne in mind that the amount of expenditure made has occasionally very little to do with the real issue; and that issue is to what extent has enhancement of the subject been produced?.........The real question is, was the property as a marketable subject, enhanced in value or not'
It was held in that case that a temple built on that land did not enhance the marketable value and the expenditure incurred thereon had to be excluded in computing the value of the improvements. In the present case, there is evidence to show that one acre of the suit dry land was converted into one of wet cultivation by levelling up etc. and this has certainly enhanced the market value of the land. As already observed a sum of Rs. 400/- may be taken as representing the value of improvements effected.
7. The plaintiffs have claimed mesne profits from defendants for three years prior to the suit. Taking the evidence as a whole and the peculiar circumstances and equities of the case, I am not inclined to allow the past mesne profits claimed specially in view of the fact that there was no notice to the defendants at the relevant time.
8. In the result the appeal is dismissed subject to the modification mentioned above regarding the disallowance of past mesne profits and allowing Rs. 400/- towards improvements. The plaintiffs may file a separate application for ascertainment of mesne profits from date of suit upto delivery of possession. In this appeal the parties will bear their own costs.
9. Decree modified.