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Durga Singh Vs. Girwar Dutt Joshi and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtAllahabad
Decided On
Reported inAIR1938All191
AppellantDurga Singh
RespondentGirwar Dutt Joshi and anr.
Excerpt:
- - 1. this is a second appeal by an unsuccessful plaintiff in a pre eruption suit. it is to be remembered that the right of pre-emption is a very weak right. it can therefore be enforced only if it is clearly established......plaintiff in a pre eruption suit. on 2nd january 1932, kanhaiya lal defendant executed a sale deed of the proportion in dispute in favour of girwar datt defendant. the sale deed recited the receipt of consideration by the vendor and was in due course registered. girwar datt was a stranger to the mahal in which the proparty conveyed by the sale deed was situated and the plaintiff, who was one of the co-sharers in the mahal, brought the suit for pre-emption giving rise to the pre-sent appeal. both the vendor and the vendee contested the suit on a rather unusual allegation. they alleged that the sale dead in question was fictitious and was executed by the vendor in favour of the vendee, who was his nephew, simply with a view to protect the property conveyed by the sale deed from.....
Judgment:

Iqbal Ahmad, J.

1. This is a second appeal by an unsuccessful plaintiff in a pre eruption suit. On 2nd January 1932, Kanhaiya Lal defendant executed a sale deed of the proportion in dispute in favour of Girwar Datt defendant. The sale deed recited the receipt of consideration by the vendor and was in due course registered. Girwar Datt was a stranger to the mahal in which the proparty conveyed by the sale deed was situated and the plaintiff, who was one of the co-sharers in the mahal, brought the suit for pre-emption giving rise to the pre-sent appeal. Both the vendor and the vendee contested the suit on a rather unusual allegation. They alleged that the sale dead in question was fictitious and was executed by the vendor in favour of the vendee, who was his nephew, simply with a view to protect the property conveyed by the sale deed from the claims of certain creditors. The defendant maintained that the ownership of the property was never intended to, and did not as a matter of fact, pass from the vendor to the vendee and that the vendor remained in possession of that property all through. In support of this assertion, the defendants relied inter alia on the fact that proceedings for mutation of names were not taken after the execution of the sale deed and that the share in dispute continued to remain recorded in the revenue papers in the name of the vendor.

2. In view of these allegations, one of the issues raised in the case was whether the sale deed was fictitious, and whether the defendants can, in bar of the plaintiff's claim for pre-emption, plead the fictitious naturo of the sale. Both the Courts below held that the sale deed was fictitious and that the vendor continued to be the owner of the property covered by the sale deed. Those Courts further held that, as the proprietary right in the share in dispute was not transferred from the vendor to the vendee, the plaintiff was not entitled to exercise the right of pre-emption, and accordingly dismissed the suit. The plaintiff has come up in second appeal to this Court and it is contended on his behalf that as a deed of transfer was duly executed by the vendor, the proprietary right in the share in dispute passed from the vendor to the vendee and accordingly the right of pre-emption was enforceable. In support of this contention reliance has been placed on the decision of their Lordships of the Judicial Committee in Tsang Chuen v. Li Po Kwai (1932) 19 A.I.R. P.C. 255. It was held in that case that if a person conveys property in a form actually and actively misleading, so that any persons reading the conveyance necessarily conclude that the transferees are the absolute owners, the transferor cannot subsequently be heard to say that the transaction evidenced by the conveyance was not the real transaction and that the transferees took on a secret trust not disclosed in the conveyance.

3. On the authority of this case1 it is argued that, as the vendor in the present case had executed a sale deed in favour of the vendee and had acknowledged in that deed that the title to the share in dispute had passed to the vendee, the vendor was debarred in the present case from asserting that the title to the property had not passed to the vendee. In the case decided by their Lordships of the Judicial Committee, the ostensible transferee had for consideration transferred the property conveyed to him to a third person, and, as such, the interest of a third person, who was a bona fide purchaser, had come into existence before the original transferor wanted to have a declaration of his proprietary title on the allegation that the transfer executed by him was not genuine and was fictitious. Their Lordships accordingly held that the original transferor was estopped from pleading that the transaction evidenced by the deed of transfer executed by him was not real and was fictitious. In the case before me the interest of no third person has intervened and no one has dealt with the vendee on the assumption that the vendee is the real owner. No question of estoppel therefore arises in the case, and as between the vendor and the vendee it is perfectly open to the vendor to prove the real nature of the transaction evidenced by the sale deed.

4. It is no doubt a fact that the plaintiff honestly believing that the sale was genuine did bring the suit giving rise to the present appeal. But the mere fact of the institution of a suit for pre-emption can not estop the vendor and the vendee from pleading and proving the real nature of the transaction, though the Court in determining the question of costs must necessarily take into consideration the fact that the blame for the institution of the Bait must rest on the shoulders of the vendor arid the vendee as they were parties to a fictitious transaction. It is to be remembered that the right of pre-emption is a very weak right. It interferes with the freedom of contract and is opposed to a progressive state of society. It can therefore be enforced only if it is clearly established. I may mention that in this case it was neither alleged nor proved by the plaintiff that as a result of the execution if the sale deed any third person was defrauded. If this fact had been proved, the vendor would undoubtedly have been estopped as against the third person from pleading that the transfer was fictitious.

5. On the finding recorded by the Courts Wow that no transfer took place, the plaintiff's suit for pre-emption was rightly dismissed and accordingly I dismiss this appeal. But having regard to the fact that the suit was occasioned by the action of the vendor in executing a fictitious sale dead I direct the parties to bear their own costs in all the Courts. Leave to appeal under the Letters Patent is refused.


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