1. This is an appeal by the plaintiffs and is directed against the appellate decision of Mr. J.C. Malik, dated 20th March 1929, confirming the decision of the Munsif, Mr. Kishori Lai, dated 19th June 1928. Chaudhri Afzal Husain owned zamindari shares in three villages, namely, Pindri, Moiya and Karmun. He sold these shares to Thakur Prasad and Baij Nath under a sale deed dated 14th August 1919 for Rs. 1,472. The sale deed contained the usual indemnity clause, which provided that if the vendees lost possession over the property sold in whole or in part the vendor would be liable to make good the loss together with interest at 1 per cent, per annum. Baij Nath sold his share to Gobardhan Das, plaintiff 1. Gobardhan Das was brother of Thakur Prasad. Thakur Prasad is dead. Bhagwat Das, plaintiff 2, is his son.
2. Ghaudhari Afzal Husain had purchased the shares in Pindari and Moiya from Ikram Husain and Ghazanfar Husain under a sale deed dated 25th February 1919. On the datp of the execution of the sale deed, Ikram and Ghazanfar were indebted to one Cheda Lal for a mortgage debt. They left Rs. 700 of the purchase money with Chaudhri Afzal Husain for payment to Cheda Lai. Afzal Husain did not pay the money. Ikram Husain and Ghazanfar Husain therefore brought a suit (No. 224 of 1922, of the Court of the. Munsif of Fatehpur) for recovery of the unpaid purchase money against Afzal Husain and also against Gobardhan and Thakur Prasad. Afzal Husain pleaded that he was no longer liable for the amount because he had parted with the property. Gobardhan and Thakur Prasad pleaded that they were bona fide purchasers for value and had no notice that the property was subject to an encumbrance in favour of Cheda Lal. Presumably they took shelter under Section 40, para. 2, T.P. Act. Their contention was overruled by the trial Court and a decree was passed on 31st January 1923 against Chaudhri Afzal Husain personally and against the property in the hands of Gobardhan Das and Thakur Prasad. In execution of this decree, the properties in Pindri and Moiya were sold on 22nd August 1927. This led to the institution of the present suit by Gobardhan Das and Bhagwat Das for recovery of Rs. 992 principal and Rs. 69-4-0 interest from Chaudhri Afzal Husain for damages consequent upon the loss of the property purchased by them under the sale deed dated 14th August 1919. This suit was instituted on 22nd March 1928.
3. Various pleas were raised in defence, but the chief contention was that the decision in Suit No. 224 of 1922 operated as res judicata inasmuch as it had been held therein that the predecessors-in-title of the plaintiff had made the purchase of zamindari shares in mauzas Pindri and Moiya with the knowledge that the property at the date of the purchase was subject to an encumbrance of Rs. 700 in favour of Cheda Lal. This plea found favour with the trial Court which dismissed the suit. It held that the former decision operated as res judicata. It also held that the plaintiff's had agreed to purchase the property as they were at the time of the sale and that they had before them the title-deeds relating to the properties a perusal of which was bound to disclose the pre-existing encumbrance. The lower appellate Court has confirmed the decree. It has been argued that the decision in the former suit does not operate as res judicata and that in view of Section 55(1)(g) and Section 55(2), T.P. Act, it was the statutory duty of Afzal Husain to discharge whatever encumbrance existed upon the property on the date of the sale.
4. We are of opinion that the Courts below have erred in holding that the claim is barred by the rule of res judicata. In the former suit Afzal Husain pleaded that he had sold away the property to Gobardhan Das and Thakur Prasad and that the plaintiffs' remedy lay not against him personally, but against the purchasers and against the property in their hands. Gobardhan Das and Thakur Prasad pleaded that they wore bona fide purchasers for value without notice and that the plaintiffs had no remedy either against them or against the property in their hands. No question arose whether Gobardhan Das and Thakur Prasad would be entitled to claim damages from Afzal Husain if the property passed out of their possession. Under the decree dated 31st, Ikram Husain and Ghazanfar Husain could proceed either against Chaudhri Afzal Husain personally or against the property in the possession of Gobardhan Das and Thakur Prasad. They chose to proceed against the latter and the property was sold on 22nd August 1927. No loss accrued to the plaintiff till the property was actually sold.
5. The cause of action for the present suit accrued on the date of plaintiffs' dispossession consequent upon the sale of the property. The plaintiffs were entitled to relief against the defendant by reason of a partial failure of consideration. They were entitled to rely upon a covenant indemnity contained in the sale deed. They did not rely upon the said covenant and the claim was not sounded upon a breach of the covenant contained in the sale deed. They, however were entitled to an implied warranty of title which has received statutory recognition in Section 55, T.P. Act. In the case of a breach of covenant or warranty of title the vendees were entitled to repudiate the sale altogether or to claim compensation for the breach. The cause of action for the suit arose as the result of the breach. The cause of action for the present suit was distinct from the cause of action in Suit No. 224 of 1922. The cause of action was consequent upon the execution of the decree in that suit resulting in the deprivation of the property purchased by the plaintiffs. The decision in the former suit could not operate as res judicata in another suit in which the cause of action was distinct.
6. Neither the trial Court nor the lower appellate Court has gone into the question as to the amount of loss sustained by the plaintiff by reason of the deprivation of the properties. In para. 5 of the plaint, the plaintiff stated that the value of the shares in the villages lost to him was Rs. 992. The defendants in their written statement disputed the correctness of this proposition. The case can not be disposed of without a finding on the aforesaid issue. As the Courts below have disposed of the case upon a preliminary ground and as we have come to the conclusion that the decision on the preliminary ground is erroneous, we allow the appeal, set aside the decrees of both the Courts below and remand the case through the lower appellate Court to the trial Court for reinstatement under its original number for disposal according to law.
7. We allow no costs to the plaintiffs-appellants because of the negligence with which the plaint was drawn up. Great stress was laid by the learned advocate for the appellants upon the indemnity clause in the sale deed. The suit was not founded upon a breach of the warranty of title as contained in the sale deed. The plaintiffs succeed because of the breach of the warranty of title which must be implied under Section 55, T.P. Act. We therefore allow no costs to the plaintiffs either of this Court or of the Courts below.