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Muthabathula Arjayya Vs. Rambala Venkata Surya Gopala Krishanamurthy and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty;Contract
CourtAndhra Pradesh High Court
Decided On
Case NumberSecond Appeal No. 62 of 1969
Judge
Reported inAIR1974AP240
ActsMadras Hereditary Village Offices Act, 1895 - Sections 5; Andhra Pradesh (Andhra Area) Inams (Abolition and Conversion into Ryotwari) Act, 1956 - Sections 3 and 15; Transfer of Property Act, 1882 - Sections 6, 23 and 53-A; Specific Relief Act, 1963 - Sections 13; Specific Relief Act, 1877 - Sections 18
AppellantMuthabathula Arjayya
RespondentRambala Venkata Surya Gopala Krishanamurthy and anr.
Appellant AdvocateChalla Sitaramayya, Adv.
Respondent AdvocateC.V. Kanyaka Prasad, Adv.
Excerpt:
property - specific performance - section 5 of madras hereditary village offices act, 1895, sections 3 and 15 of andhra pradesh (andhra area) inams (abolition and conversion into ryotwari) act, 1956, sections 6, 23 and 53-a of transfer of property act, 1882, section 13 of specific relief act, 1963 and section 18 of specific relief act, 1877 - suit filed for specific performance of agreement entered between appellant and respondent 2 (r2) - agreement entered related to sale of inam land - subsequently land sold to respondent 1 by r2 - validity of agreement challenged by respondents on ground that it comes within purview of section 5 - even if not it is void as according to provisions of inams abolition act (act) it is against public policy - court observed that section 5 not applicable as.....vaidya, j.1. the plaintiff-appellant in this second appeal filed a suit for specific performance of an agreement of sale executed by the 2nd respondent, ist defendant in the suit, on 24th october , 1960 after obtaining full consideration for the sale from the plaintiff. the appellant was also put in possession of the suit property. it is agreed between the parties that the 2nd respondent will execute a sale deed within a period of two years. the case of the appellant is that the period of two years was stipulated in the agreement of sale as that was thought to be sufficient period in which the 2nd respondent would obtain a ryotwari patta under the provisions of andhra pradesh (andhra area) inams (abolition and conversion into ryotwari) act , hereinafter referred to as 'the inams abolition.....
Judgment:

Vaidya, J.

1. The plaintiff-appellant in this Second Appeal filed a suit for specific performance of an agreement of sale executed by the 2nd respondent, Ist defendant in the suit, on 24th October , 1960 after obtaining full consideration for the sale from the plaintiff. The appellant was also put in possession of the suit property. It is agreed between the parties that the 2nd respondent will execute a sale deed within a period of two years. The case of the appellant is that the period of two years was stipulated in the agreement of sale as that was thought to be sufficient period in which the 2nd respondent would obtain a Ryotwari patta under the provisions of Andhra Pradesh (Andhra Area) Inams (Abolition and Conversion into Ryotwari) Act , hereinafter referred to as 'the Inams Abolition Act' . The 2nd respondent obtained the patta ; but instead of executing a sale deed in favour of the appellant , executed it in favour of the Ist respondent , the 2nd defendant in the suit. The appellant further averred that the Ist respondent purchased the suit property from the 2nd respondent having notice of the agreement of sale in favour of the appellant. The 2nd respondent in his written statement stated that the suit agreement of sale is not true, valid and binding on him. he alleged that he appellant had originally obtained a urfructuary lease for a period of five years from his mother for a sum of Rs. 350/- and in pursuance of it got into possession of the suit property. He denied that the appellant ever paid him an amount of Rs. 600/- . He further contended that the plaintiff was aware that the suit land was a service inam and that any alienation of such a land would be invalid. Having come into possession of the suit property in the capacity of a usufactuary lessee, the appellant managed to obtain from him the alleged suit agreement which is only a nominal document. He averred that the Ist defendant is bona fide purchaser for value without notice of the agreement of sale in favour of the appellant. The Ist respondent also filed a separate written statement contending that he is a bona fide purchaser for value without notice of the agreement of sale. He also contended that he was informed by the 2nd respondent that the appellant was his tenant under a usufructuary lease which had expired with the year 1962-63 and that he had given up possession also. He contended that the suit agreement is invalid as it is opposed to Section 5 of the Madras Hereditary Village Offices Act (Madras Act III of 1895) , hereinafter referred to as 'Act III of 1895'.

2. On these pleadings, the trial Court framed the necessary issues and decreed the plaintiff suit for specific performance holding that the suit agreement is true and supported by consideration, and that the Ist respondent had notice of the suit agreement before the purchased the property from also held that the suit agreement is not hit by the provisions of Act III of 1895 .

3. Aggrieved by this decision of the trial Court, the Ist respondent filed an appeal before the Subordinate Judge, Amalpuram. The learned Subordinate Judge held that the suit agreement is true, valid and supported by consideration , and that the Ist respondent had notice of the said agreement before he purchased the same from the 2nd respondent. He allowed the appeal on the ground that the suit agreement is hit by the provisions of Section 5 of Act III of 1895. Hence the plaintiff-appellant filed this Second Appeal.

4. When this appeal came up for hearing before our learned brother , Ramachandra Rao, J. he ordered it to be posted along with writ Appeal No. 553/1968 as some of the questions arising in this appeal and also in the above writ appeal were common .

5. The questions that arise for consideration in this second appeal are : (1) Whether the inam tenure is abolished and converted into a ryotwari tenure from the date of commencement of the Inams Abolition Act : (2) Whether Section 15 of the Inams Abolition Act repeals Act III of 1895 ; (3) in case it is held that the land in question continued to be an inam land and is governed by the provisions of Act III of 1895 , whether Section 5 of the said Act applies , and (4) Assuming that the suit agreement of sale is not hit by Section 5 of Act III of 1895 , is it otherwise void ab intitio being contrary to public policy and is, therefore, not specifically enforceable. Of the aforesaid four questions , the First two questions are common to this appeal and also to writ Appeal No. 553 of 1968 = (reported in AIR 1974 Andh Pra 161 (FB)) in which we have held that the inam tenure is not abolished and converted into a ryotwari tenure and converted into a ryotwari tenure patta. We have also held that as the inam tenure continues till the grant of a ryotwari patta, section 5 of Act III of 1895 continues to apply and Section 15 of the Inams Abolition Act does not abrogate the provisions of Act III of 1895. We now proceed to consider the other two questions raised in this appeal.

6. Before we take up the consideration of questions (3) and (4) , it is necessary to refer to the circumstances in which the agreement of sale was executed by the 2nd respondent in favour of the appellant on the 24th October , 1960 (Ex. A-1). The Inams Abolition Act had come into force on the 14th December , 1956 ; and by virtue of section 4 of the Act , the 2nd respondent who is the inamdar, the land being a washerman's service inam, became entitled to ryotwari patta. Ryotwari patta was granted sometime after the execution of ex. A-1 and before the 6th July 1963 , the date of registration sale in favour of the Ist respondent by the 2nd respondent. The plaintifff-appellant specifically pleaded in his plaint that he did not take any sale deed from the 2nd respondent having come to know that the land was a washerman's service inam land, and that the 2nd respondent had not obtained a ryotwari patta for the said Inams Abolition Act. It was for this reason that he obtained only an agreement of sale and stipulated a period of two years for the execution of the sale deed in his favour by the 2nd respondent. The 2nd respondent denied that the agreement of sale was true, valid and supported by consideration. He set up the case that the plaintiff was already in possession of the suit property on the basis of a usufructuary lease in his favour for Rs. 350 and when he was in possession, he obtained Ex. A-1 from the 2nd respondent . It is not denied by the 2nd respondent that prior to the execution of the sale deed in favour of the 1st respondent, the 2nd respondent obtained a ryotwari patta in respect of the suit land. The appellant examined himself and other witnesses to prove the circumstances in which the period of two years was stipulated in Ex. A-1. The evidence of these witnesses has been referred to by the trial Court in its judgment , but no specific finding had been given that the period of two years was stipulated in the agreement to enable the 2nd respondent to obtain a ryotwari patta of the suit land. The trial Court has held that the suit agreement is true and binding on the 2nd respondent and the 1st respondent being a purchaser with notice of the agreement of sale , specific performance of the agreement can be decreed as against him also. On appeal by the 1st respondent the 1st appellate Court has also not given any finding as to whether the period of two years stipulated in the agreement of sale was to enable the 2nd respondent to obtain a ryotwari patta. In these circumstances , it is open for us to come to a conclusion of our own, Considering the fact that the date on which the suit agreement was executed a period of about four years had elapsed from the commencement of the Inams Abolition Act and considering the circumstances that the 2nd respondent was entitled to obtain a ryotwari patta under the provisions of the said Act and considering further the evidence that has been led by the appellant in order to prove that the period of two years was stipulated so as to enable the 2nd respondent to obtain a ryotwari patta, we hold that the agreement of sale was executed in the circumstances mentioned by the appellant in his plaint. It is in the light of this finding that the arguments advanced before us have to be considered and determined.

7. The learned counsel for the appellant argued that Section 5 of the Act III of 1895 prohibits transfer of a land given to a service-holder by way of emoluments for the service. According to him, the word 'transfer' therein denotes the transfer of title in the inam lands and any transaction short of transfer of title is not hit by the provisions of the said section . Under Section 54 of the Transfer of Property Act ,a contract of sale is to obtain a registered sale deed in accordance with the provisions of law. An agreement to sell therefore , is not within the ambit of Section 5 of III of 1895 . On the contrary , the learned counsel for the 2nd respondent argued that the provisions of Section 5 are wide enough to take in an agreement of sale especially when possession has been given under the said agreement.

8. Section 5 of Act III of 1895 reads :

'The emoluments of village offices , whether such offices be or be not hereditary , and , in the scheduled districts as defined in the Scheduled Districts Act , 1874 all such emoluments granted or continued in remuneration for the performance of duties connected with the collection of the revenue or the maintenance of order , shall not be liable to be transferred or encumbered in any manner whatsoever and it shall not be lawful for any Court to attach to sell such emoluments or any portion thereof .'

According to this section , emoluments of an office shall not be transferred or encumbered. The word 'transfer' or encumbrance' has not been defined in the Act and will therefore have to be understood taking into consideration the provisions of law in regard to transfer of property . Before Act III of 1895 was enacted, the Transfer of Property Act (IV of 1882) was already in force in the then province of Madras . It can , therefore , be presumed that he legislature when it used the word 'transfer' had before it the provisions of the Transfer of Property Act . Section 54 of the Transfer of Property Act provides which is defined as 'a transfer of ownership in exchange for a price paid or promised or part-paid and part-promised.' The said section also lays down that a contract that a sale of such property shall take place on terms settled between the parties ; and does not, of itself , create any interest in or charge on such property. In view of this definition in Section 54 of the Transfer of Property Act , an agreement of the sale does not create any interest in or charge on such property . It is only an agreement that the sale of such property shall take place on the terms settled between the parties. It may be noted that in addition to putting an embargo on transfer or encumbrance in any manner whatsoever of the emoluments of an office, Section 5 of Act III of 1895 further goes on to provide that 'it shall not be lawful for any Court to attach to sell such emoluments or any portion thereof' . The purpose of the section is , therefore , clear that no charge shall be created on emoluments of an office either by act of parties or by attachment of the property and further the ownership in the emoluments should not be extinguished in the emoluments should not be extinguished either by a transfer inter vivos or by sale through a Court. The word 'transfer' in the context of Section 5 will have to be interpreted as the transfer of right , title and interest in the property and therefore cannot take in an agreement of sale. It is argued by the learned counsel for the 2nd respondent that the word used in Section 5 are 'transferred encumbered in any manner whatsoever' . The section does not use the word 'sale' . If it was the intention of the legislature to prohibit sales of any property, it would have said so by using the word 'transfer'. According to him, the word 'transfer' connotes something less than a sale especially when it is stated that the transfer may be in any manner whatsoever . An agreement of sale is also a transfer , it is argued , and it is within the ambit of Section 5 of Act III of 1895. We cannot agree with this contention of the learned counsel. We have already shown that the word 'transfer' occurring in this section has to be understood as transfer of right, title and interest in immovable property. The expression 'in any manner whatsoever' does not in any manner extend the meaning and import of the word 'transfer' in Section 5 of Act III of 1895 .

9. We are supported by a decision of a Division Bench of this Court in Syed Jalal v. Targopal : AIR1970AP19 rendered by Jaganmohan Reddy , C. J. (as he then was) and Parthasarathi J. The learned Judges were considering the provisions of Section 47 of the Andhra Pradesh (Telengana Area) Tenancy and Agricultural Lands Act , 1950. That section reads :

'47 (1) 'Notwithstanding anything contained in any other law for the time being in force or in any decree or order of a Court, no permanent alienation and no other transfer of agricultural land shall be valid unless it has been made with the previous sanction of the Tahsildar .

XX XX XX XX

The word 'transfer' in this section came up for consideration before the learned Judges were held :

'What is prohibited and what is invalid is transfer or alienation of legal right , title or interest , which confers a right to possession of agricultural land if it is without permission of the Tahsildar. Agreements to enter into transactions to confer such a right , title and interest , if the provisions of law are complied with , namely , after obtaining the permission of the Tahsildar , are not prohibited ; nor do they by themselves confer a right to possession so that if any possession is delivered in pursuance thereto, it cannot be said that that possession has been delivered in conformity with the statute or in a manner that would be according recognition thereunder .'

The learned counsel for the 2nd respondent tried to distinguish this case on the ground that there is no total prohibition of transfer under Section 47 of the aforesaid Act. The only embargo put in Section 47 of the said act is that a transfer cannot be made without the permission of the Tahsildar whereas in Section 5 of Act III of 1895 there is total embargo on transfer of emoluments of a service. It is true that the distinction pointed out by the learned counsel is there ; but that distinction does not in any manner determine the meaning to be given to the word 'transfer' . In Section 47 of the Andhra Pradesh (Telagana Area) Tenancy and Agricultural Lands Act, the word 'transfer' occurs. That word has been interpreted to mean a transfer of right, title and interest in the land. There is no reason why the same meaning should not be given to the word 'transfer' occurring in Section 5 of the Act .

10. In this context, it is argued by the learned counsel for the 2nd respondent that even if an agreement of sale simpliciter in which possession is not given, is not held to be within the ambit of Section 5 of Act III of 1895 , certainly an agreement of sale under which possession has been given has to be held to come within the ambit of the said section. The argument is that , by virtue of obtaining possession under the agreement of sale, the would-be vendee is entitled to keep possession under the provisions of Section 53A of the Transfer of Property Act and thus deprive the inamdar of enjoyment of the inam lands. A question of this nature came up for consideration in Syed Jalal's case , : AIR1970AP19 and the learned Judges observed at p. 31.

'A contract of sale followed by possession under the general law , would, subject to the fulfillment of the requirements of Section 53A of the Transfer of Property Act have enabled a person in possession to use it as a shield to defend his possession. But having regard to the provisions of Section 47 read with Section 98 , in the view we have taken, no right to possession capable of being upheld under the special enactment can be conferred by means of a permanent alienation or other transfer unless the prior permission of the Tahsildar is obtained ................... The possession referred to here is lawful possession , not unauthorised or unlawful or wrongful possession. It is not necessary to negative the defence of Section 53A that the contract of sale should also be void or illegal . Though the contract of sale should also void or illegal . Though the contract is lawful, as indeed we have held it so , since possession without the prior sanction of the Tahsildar cannot be regarded as authorised under Section 98 , the remedy of Section 53A will not be available .'

These observations will apply with greater force to an agreement of sale wherein possession is given in regard to a land held by way of emoluments of a service. We , therefore , hold that in a case where possession is obtained under an agreement of sale in respect of a service inam land, the provisions of Section 53A of the Transfer of Property Act cannot be resorted to by the would-be vendee to maintain his possession. In such a case if the inamdar is to file a suit for possession of the inam land, Section 53A of the Transfer of Property Act would not be a defence .

11. The learned counsel for the appellant relied on a Division Bench decision of the Gujarat High Court in Abdul Satar v. Manilal , : AIR1970Guj12 . This is a case in which the question of specific enforcement of an agreement of sale executed in regard to an evacuee property administered under the Administration of Evacuee Property Ordinance , 1949 came up for consideration . Section 38 of the said Ordinance specifically provided that :

38 (1) 'No transfer of any right or interest in any property made in any manner whatsoever after the 14th day of August , 1947 , by or on behalf of an evacuee or by or on behalf of a person who has become an evacuee after the date of the transfer , shall be effective so as to confer any rights or remedies on the parties to such transfer or on any person claiming under them unless it is confirmed by the Custodian .'

The learned Judges held that a contract of sale of immovable property does to create any interest in or charge on property so as to attract the provisions of Section 38 of the Administration of Evacuee Property Ordinance . It was further held that a suit for specific performance can be decreed in view of the provisions of Section 18 of the Specific Relief Act .

12. Reliance is also placed by the learned counsel for the appellant on a decision of Devadoss, J., in Venkanna v. China Appalaswami , (1925) 48 Mad LJ 217 = (AIR 1925 Mad 749) . The learned Judge held that the sale of a village service inam is not void ab initio. But this case, has been dissented from by a Bench of the Madras High Court in chinna Nagiah v. Pullayya , (AIR 1931 Mad 610) and it has been held therein that this decision is contrary to the decision of the Full Bench in Sannamma v. Radhabhavi , ILR 41 Mad 418 = (AIR 1918 Mad 123) (FB) . We are , therefore , of the opinion that the decision in Venkannma's case , (1925) 48 Mad LJ 217 = (AIR 1925 Mad 749) relied upon by the learned counsel for the appellant cannot be considered as good law.

13. The next argument of the learned counsel for the 2nd respondent is based on the provisions of Section 6 of the Transfer of Property Act. He relies upon clauses (a) , (d) , (f) and (h) and argues that the agreement to sell a service inam land is hit by all or any one of these clauses. The relevant portions of Section 6 are :

'6. Property of any kind may be transferred , except as otherwise provided by this Act or by any other law for the time being in force.

(a) The chance of an heir-apparent succeeding to an estate, the chance of a relation obtaining a legacy on the death of a Kinsman, or any other mere possibility of a like nature , cannot be transferred .

(b) xx xx xx

(c) xx xx xx

(d) An interest in property restricted in its enjoyment to the owner personally cannot be transferred by him .

(f) A public office cannot be transferred , nor can the salary of a public officer , whether before or after it has become payable .

(g) xx xx xx

(h) No transfer can be made (1) in so far as it is opposed to the nature of the interest affected thereby or (2) for an unlawful object or consideration within the meaning of Section 23 of the Indian Contract Act , 1872 or (3) to a person legally disqualified to be transferee .'

14. It is well-settled that any agreement of sale in regard to property which cannot be transferred is void ab initio , and it is further well-settled that an agreement which is void ab initio cannot be specifically enforced .

15. In regard to clause (a) , of Section 6 , the argument is that , at the date when the agreement of sale was executed by the 2nd respondent in favour of the appellant , it was only a possibility that the 2nd respondent might get a ryotwari patta in his favour . At the date when the agreement was executed , there was a total ban on the sale of property . The mere possibility of a ryotwari patta being granted in favour of the 2nd respondent make the transfer within clause (a) of Section 6 . In support of this contention reliance is placed by the learned counsel for the 2nd respondent on a decision of Philips , J., in Auryaprabhakara Raju v. Gummudu Sanyasi , (1925) 48 Mad LJ 598 = (AIR 1925 Mad 885). In that case the agreement of sale was with respect to certain Karnam's service inams. The transfer of such inams is forbidden by Section 5 of Act III of 1895 . It was argued by the would-be purchaser that this agreement was not to transfer the inam when it constituted the emoluments of the Karnam's Office , but to transfer this land after it had been enfranchised by the Inam Deputy Collector and therefore Act III of 1895 did not apply. The learned Judge observed that :

'It is quite true that if the land has been enfranchised at the time of the contract , it would have been transferred without offending against Madras Act III of 1895 , but when the parties entered into the contract , there was no certainty that the land would be enfranchised or even if enfranchised, that it would be enfranchised in the name of the contracting party . He was no doubt expecting that it would be so done and agreed to transfer his interest in the property when the event had taken place .'

The learned Judge held it to be nothing more than a transfer of his expectation and as such would offend against Section 6 of the Transfer of Property Act.

In regard to clause (d) , the argument is that an inam land granted to a holder of a service so for his enjoyment personally and cannot be transferred by him by virtue of Section 5 of Act III of 1895 . That being so, it is an interest in property restricted in its enjoyment to the owner personally ; and such an interest cannot be transferred under the provisions of clause (d) of Section 6. Under clause (f) , a salary of a public officer is not transferable. The inam land is by way of emoluments of a public office and therefore not transferable. In support of this contention , reliance is placed on a decision of Gopal Rao Ekbote , J., in Venkatareddi v. Venkatachalam , : AIR1964AP465 . Sub-clauses (1) and (2) of clause (h) of Section 6 of the Transfer of Property Act are also , according to the learned counsel for the 2nd respondent, attracted in the instant case. The inam is given to the service-holder with the intention that he should enjoy the same during the period he is doing service. The very nature of interest created in the inam land is only during the period the service-holder is discharging the duties of his office. As soon as the service-holder is discharging the duties of his office. As soon as the service-holder ceases to discharge the duties of his office, he is not entitled to get the emoluments. In such a case , any sale of the inam land is opposed to the nature of the interest affected by the sale and therefore is within sub-clause (1) of clause (h). As regards sub-clause (2)of clause (h) the arguments is the object of enacting Section 5 of Act III of 1895 is that he property should not be lost to the inamdar as being an emolument to the service he performs. In the case of a sale, an inam lands would be lost to the service-holder and such a sale would be for an unlawful object or consideration within the meaning of Section 23 of the Indian Contract Act. In support of the contentions that the policy of Section 5 of Act III of 1895 is not to divest an inamdar of the enjoyment of the land, reliance is placed on a Full Bench decision of the Madras High Court in Anjaneyulu v. Venugopal Rice Mills , (AIR 1922 Mad 197) (FB) and a decision of Gopal Rao Ekbote , J. in : AIR1964AP465 .

16. It has to be remembered in the instant case that the agreement of sale stipulates a period of two years within which the 2nd respondent would get ryotwari patta in his name. At the time when the agreement was entered into, the Inams Abolition Act had come into force and the 2nd respondent had become entitled to claim ryotwari patta being a person in possession of the suit land on the date of the commencement of the Inams Abolition Act. There is nothing on record to show that , at the date of commencement of the Inams Abolition Act , there was any tenant in possession of the suit land . It is also not disputed that the 2nd respondent is a list-holder of the inam. He had only to take proceedings under the provisions of the Inams Abolition Act and obtain a ryotwari patta of the suit land which , under the provisions of the said Act , he is entitled to. In these circumstances , it cannot be said that the obtaining of the ryotwari patta of the suit land was a mere possibility , as observed by Phillips , J. in (1925) 48 Mad LJ 598 = (AIR 1925 Mad 885). The agreement between the parties is that the 2nd respondent would, after obtaining a ryotwari patta which would entitle him to sell the property, execute the sale deed is favour of the appellant. Such an agreement can be likened to an agreement to sell entered into by a person who is not the present owner of the property but agrees to purchase the property later and sell it to the would-be vendee. In such cases, it cannot be said that what is sold is only a mere possibility and is , therefore, hit by the provisions of clause (a) of Section 6 of the Transfer of Property Act.

We are supported in this conclusion of ours by a decision of a Division Bench of the Calcutta High Court in Prem Sukh Gulgulia v. Habib Ullah, (AIR 1945 Cal 355). In this case, an agreement of sale was executed by a person who had no title to any one of the properties he had agreed to sell. He expected to buy them at a court sale to be held the next day. The learned Judges proceeded to determine whether what had been agreed to be sold was a 'mere possibility of a like nature' as the expectancy of a relation to get a legacy from a kinsman then living . The learned Judges observed at page 358 :-

'There was no doubt an element of chance so far as Ex. 1 was concerned at the time of its execution, for the vendor may or may not have been successful in buying any one item of property at the court sale, that was held later on : but the chance was not so remote as in those two cases mentioned, namely, of the heir apparent or of the relation to obtain a legacy from a living kinsman. Transfers of non-existence , or as it is conveniently called after acquired property, provided they are not of the nature contemplated in Section 6(a), T.P. Act are perfectly valid. The transfer would be regarded in a court of justice as a contract to transfer after the vendor had acquired title and would fasten upon the property as soon as the vendor acquires it : Holroyd v. Marshall , (1864) 10 HLC 191) : Collver v. Isaacs , (1882) 19 Ch D 342 : and Tailby v. Official Receiver , (1888) 13 AC 523) . The principles laid down in these cases have been followed in India , See Khobari Singh v. Ram Prosad Roy , (1908) 7 Cal LJ 387) . If that be so, we do not see any ground for holding a contract for sale of non-existent property , that is , of property which is not the vendor's at the time of the contract , but which the vendor thinks of acquiring by purchase later on , to be bad in law . There is nothing in the contract Act or any law which makes invalid .'

17. The provisions of clause (d) of Section 6 of the Transfer Property Act are not attracted in the instant case. Even though the ryotwari patta of the suit land had not been granted to the 2nd respondent, he had become entitled to the same by virtue of the provisions of the Inams Abolition Act. In such a case, an agreement to sell the inam land would not be an agreement to sell an interest in property restricted in its enjoyment to the owner personally; for, after the grant of the ryotwari patta he would be the full owner and there would not be any restriction in its enjoyment by the owner of the property. In regard to clause (f) Schwabe, C.J., has observed in AIR 1922 Mad 197 (FB) that clause (f) which provides that a public office cannot be transferred nor the salary of a public Officer, does not apply to a sale of Swasthivachanam service inam land. In the case before us, particularly clause (f) is not attracted as we have already shown that the agreement is to sell the suit property after obtaining a ryotwari patta when it no longer remains the salary of a public officer.

18. Sub-clauses (1) and (2) of clause (h) of the Transfer of Property Act do not apply to the instant case. The Full Bench of the Madras High Court in Anjaneyalu's case, (AIR 1922 Mad 197) (FB) has applied the provisions of sub-clause (1) of clause h). That case is distinguishable on the ground that in the instant case the sale of property being after obtaining a ryotwari patta is not opposed to the nature of the interest in the inam land. The provisions of Section 23 of the Contract Act are also not attracted because the object or consideration of the sale agreement is not unlawful. The object of the agreement is to sell the property which would become vested in the inamdar after the grant of the ryotwari patta. The object is not to do anything prohibited by the provisions of any law or for the matter of that by Section 5 of Act III of 1895. Had it not been the position that the 2nd respondent was entitled to claim a ryotwari patta in the inam lands by virtue of the provisions of the Inams Abolition Act , it could have been argued that the object of the agreement was to do something which was prohibited by S. 5 of Act III of 1895. The object of agreement being to well the land after the 2nd respondent becomes entitled to sell it, it cannot be said that the object was unlawful or opposed to public policy. We are, therefore, of the opinion that clause (h) of Section 6 of the Transfer of Property Act is not attracted. We are also of other opinion that Section 23 of the Indian Contract Act is also not attracted. We do not think it necessary to refer to the decision cited by the learned counsel for the 2nd respondent in support of the contention that an agreement of sale for an unlawful object or a sale for an unlawful considerations void.

19. It was strenuously argued by the learned counsel for the 2nd respondent that we, having come to the conclusion that the inam tenure is not abolished and converted into a ryotwari tenure until the grant of a ryotwari patta, cannot give the benefit of the provisions of the Inams Abolition Act to the appellant and determine the validity of the agreement of sale in the light of the provisions of the Inams Abolition Act. We do not see any force in this connection. It is true that the inam tenure is not converted into a ryotwari tenure from the date of commencement of Inams Abolition Act. But that does not mean that the provisions of the Inams Abolition Act cannot be looked into to determine what was the object of the parties in entering into the agreement of sale after the enforcement of the Inams Abolition Act. By taking into consideration the provisions of the Inams Abolition Act of this limited purpose, we are not in any manner applying the same to the service inam land prior to the grant of a ryotwari patta. We are considering the provisions of the Inams Abolition Act only to determine whether the 2nd respondent had became entitled to claim a ryotwari patta under the provisions of the Inams Abolition Act. Such a limitted application of the Inams Abolition Act in our opinion is not in any way contrary to our decision in regard to the conversion of the inam tenure.

20. In the instant case, it cannot be stated that the agreement is void abinitio and therefore no suit for specific performance of such an agreement can lie.

The last argument of consideration is whether Section 18 of the Specific Relief Act is applicable to the case. The relevant provisions of Section 18 read :

'18. Where a person contracts to sell or let certain property, having only an imperfect title thereto, the purchaser of lessee may compel in to make good the contract out of such interest:

xx xx xx'

21. It is argued that at the date when the agreement of sale was entered into, the 2nd respondent had no title in the property and therefore it is not a case of a person having an imperfect title to attract the provisions of Section 18 of the Specific Relief Act. It is the contention of the 2nd respondent that this is a case of absence of title and in such cases the provisions of Section 18 of the Specific Relief Act are not attracted and the appellant cannot claim specific performance. As regards the rights of an inamdar in a service inam, it cannot be said that he has no title to the inam land. He is entitled to enjoy the inam land till his lifetime or till he is performing the service which the said land is an emolument, Section 5 of the Act III of 1895 puts an embargo on his transferring or encumbrancing the inam land. But such an embargo cannot have the effect of depriving the inamdar of his title in the inam land. On account of this embargo it cannot be said that the inamdar has no title to the inam land. The embargo on sale and encumbrance would only make his title imperfect. This is not a case where there is any absence of title in the manner, but is only a case of imperfect title. In this view of the matter, there is no reason why Section 18 of the specific Relief Act is not applicable.

22. The Supreme Court in Kalyanpur Lime Works v. State of Bhiar, : [1954]1SCR958 where, when the Government entered into a contract to grant a lease, it had an imperfect title, inasmuch as it could not grant a fresh lease to any one during the existence of the previous lease in favour of another person and when the lease infavour of the other person expired, the impediment in the way of the government to grant lease stood removed and the first person's right to get the lease revived in his favour, held that Section 18 of the Specific Relief Act was attracted to the facts of the case, but a substantial period of the lease had already expired, relief was granted under Section 15 of the Specific Relief Act.

23. In Silla Chandra v. Ramachandra Sahu, : [1964]7SCR858 The Supreme Court applied the provisions of Section 18(a) to an agreement of sale executed by a person who styled himself as the Managing Member and Karta of the family. The agreement also contained a condition that he and his mother would execute a deed of the sale within a period of one year from the date execution of the agreement of sale. The vendor did not executed the sale deed and the vendee instituted a suit for specific performance of the contract. Their Lordships observed that the vendor had interest in the entire house and so had his mother, though in case of actual partition the interest of each would have been fixed at half. If the vendor was not competent to pass title with respect to the entire house during the lifetime of his mother, he can be said to have imperfect title to it. On the death of the mother, he obtained title to and interest in the portion of the house which on a private partition subsequent to the contract to sell had taken place between him and his mother and that therefore he has to make good his contract out of the property he acquired subsequent to the contract to sell.

24. The aforesaid cases are akin the case before us and applying the principles enunciated in those cases, it can be held that in the instant case the inamdar has only an imperfect title and is not a case of absence of title.

25. Section 18 of the Specific Relief Act has been applied also to cases where a person, at the time of agreement of sale, had no title in the property agreed to be sold. Clause (a) of Section 18 gives right to the purchaser to compel the vendor to make good the contract out of any interest the vendor has acquired in the property after the contract of sale. The expression 'any interest' is very wide in its amplitude and also denotes a case in which a vendor who has no title to the property acquires title after the contract of sale. There is nothing in clause (a) to limit the expression 'any interest' only to cases where a person has title to the property and later he acquires an interest which enables him to give a valid title to the purchaser. This view was taken by a single Judge of the Nagpur High Court in Pundlik Daryaji v. Jainarayan Maliram Shop, (AIR 1949 Nag 83). The defendant therein purchased certain propertied at an auction sale for arrears of land revenue. Before the sale was confirmed in his favour, he entered into an agreement to execute a sale deed in favour of the plaintiff. On confirmation of the sale in favour of the defendant, he refused to execute a sale deed and the plaintiff brought a suit for specific performance. It was argued before the learned Judge that the expression 'imperfect title' in Section 18 did not include absence of title. On the date of the agreement of sale, the defendant therein had no title to the property as the sale had not been confirmed. The learned Judge replied this argument observing that by virtue of clause (a) of Section 18, the vendee can compel the vendor to make good the contract out of any interest in the property subsequently acquired by the vendor. This, according to the learned Judge, indicated that the words 'imperfect title' would include even complete absence of title. The learned Judge then referred to the rule of English law that if a man sells an estate to which he has no title and, after the conveyance acquires the title, he will be compelled to convey it to the purchaser and relied upon (1864) 10 HLC 191. This case has been distinguished by a learned Judge of the Bombay High Court in Bhiku Keru v. Dashrath, : AIR1967Bom267 . While distinguishing, the learned Judge has held that in the circumstances of the case, the Nagpur High court came to the conclusion that it was a case of imperfect title and not a case of absence of title. While making this remark the learned Judge of the Bombay High Court has not taken into consideration the interpretation of clause (a) of Section 18 of the Specific Relief Act made by the Nagpur High Court. The Supreme Court case referred to the above, namely, Silla Chandra's case, : [1964]7SCR858 has not expressed any opinion on this aspect of the matter and left the question open. The Supreme Court in Kalyanpur Lime Works Case, (AIR 1964 SC 165) also had no occasion to consider whether the expression 'imperfect title' can take in the case of absence of title. Pundalik Daryaji's case, (AIR 1949 Nag 83) has been referred to in Mulla's Commentary on contract and Specific Relief Act and no adverse comment has been made in regard to that decision.

26. It may, therefore, be stated that prior to the passing of the Specific Relief Act (Act No. 47 of 1963), There was a decision to show that Section 18 of the Specific Relief Act is applicable to cases where a person who has no title in the property enters into a contract to sell the property. In the Specific Relief Act of 1963, Section 13 is a provision corresponding to Section 18 of the old Act. The material portion of Section 13 of the new Act reads:

'13: (1) Where a person contracts to sell of let certain immovable property having no title or only an imperfect title, the purchaser or lessee (subject to the other provisions of this Chapter), has the following rights.......'

The position has thus been certified by the legislature by introducing the words 'having no title.' It can, therefore, be safely concluded that Section 18 of the old Specific Relief Act was equally applicable to cases where the person entering into an agreement of sale had no title to the property at the date of the agreement.

27. The learned counsel for the 2nd respondent, on the strength of the decision in Bhiku Keru's case, : AIR1967Bom267 , advanced an argument that clause (a) of Section 18 of the Specific Relief Act applies only to cases where there has been a completed sale and is not applicable to cases of agreement of sale. This conclusion of the Bombay High Court is based on the expression 'vendor or lessor', 'Purchaser or lessee' and 'subsequently to the sale or lease' used in clause (a) of Section 18. This decision is based on a Bench decision of the Orissa High Court in Silla Chandra v. Lalita, : AIR1959Ori169 . The aforesaid decision of the Orissa High Court was taken in appeal to the Supreme Court and was reserved in Silla Chandra's case, : [1964]7SCR858 . Their Lordships observed that if clause (a) of Section 18 was to apply to the completion of sale or a lease and on the vendor or lessor acquiring interest in the poverty in which he had imperfect title to start with, there would be considerable overlapping between the provisions of clause (a) of Section 18 and Section 43 of the Transfer of Property act. It was further observed at p. 1792:--

'The expression in clause (a) of Section 18 should preferably be construed in a way so that there will be no overlapping between the provisions of this clause and of Section 43 of the Transfer of Property Act, as ordinarily the legislature does not intend to make duplicate provisions for similar situations.

This use of the words 'vendor or lessor' in clause (a) is no definite pointer to the conclusion that the expression 'subsequently to the sale or lease' be given the meaning 'subsequent to the actual sale or lease.'

The sections preceding Section 18 deal with specific performance of contracts in general and therefore use the expression 'party to a contract'. Section 18 deals with the cases of contracts to sell or let and therefore appropriately use the simple word 'vendor' or 'lessor' with respect to the party contracting to sell or let and 'purchase' or 'lessee' with respect to the party agreeing to purchase or take the property on lease. There is no incongruity in using such expressions so long as one knows to whom those expressions so long as one knows to whom those expressions refer. In fact the word 'purchaser' or 'lessee' can be appropriately applied to persons agreeing to purchase or take the property on lease .'

28. It has , therefore , been authoritatively held that clause (a) of Section 18 is applicable to agreement of sale. The position is now absolutely made clear in clause (a) of Section 13 of the 1963 Act which reads :

'(a) If the vendor or lessor has subsequently to the contract acquired any right in the property , the purchaser or lessee may compel him to make good the contract out of such interest .'

29. We, therefore , conclude that in the facts of the present case , the appellant is entitled to the benefit of clause (a) of Section 18 of the Specific Relief Act and ask for specific Relief Act and ask for specific performance of the agreement of sale .

30. The Second Appeal is , therefore , allowed with costs throughout. The judgment and decree of the Subordinate Judge of Amalapuram are set aside and those of the District Munsif of Amalapuram are restored .

31. Appeal allowed.


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