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Kalka Singh Vs. Namdar Khan - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtAllahabad
Decided On
Reported inAIR1933All389
AppellantKalka Singh
RespondentNamdar Khan
Excerpt:
- - 2. in the sale-deed the seller undoubtedly professes to transfer to the buyer the absolute' ownership of the property and, according to the argument for the applicant, he must be made to compensate the buyer now that his title has failed. the liability of the vendor clearly exists. mathia kone air1925mad968 it was held that when the vendee is perfectly aware of the defect in title or existence of an incumbrance, there is no duty on the part of the' seller to inform the buyer of that of which the latter is perfectly aware. the question was raised in connexion with clause (1), section 55 and not clause (2), and it may well be that it was not necessary for the seller to inform the buyer of facts which the latter already knew, but that does not appear to affect his obligation to make..........court below has not decreed the plaintiff's suit is that the buyer had notice of a cloud on the seller's title. in the circumstances it can hardly be held that notice would affect the buyer's statutory right, because even if he had full knowledge that the seller's interest was vulnerable, it may easily be inferred that he relied on his statutory right under section 55(2) to protect himself against the risk he was taking. the court has however referred to the decision of a single judge of this court in the case of kali din v. madho a.i.r. 1923 all. 169. it is certainly laid down there that section 55(2) will apply in such a caseunless it be shown that the benefit of the rule 'was lost to the purchaser by a fraud, notice, 'waiver or express or implied contract.5. sir louis stuart, the.....
Judgment:
ORDER

Kendall, J.

1. This is an application for the revision of a decree and order of the Judge' of the Small Cause Court of Jaunpur, dismissing the suit of the plaintiff applicant for compensation for dispossession of the property purchased from the defendant. The circumstances are briefly that the defendant had purchased some immovable property from a Hindu widow, who was in need of money for the' purposes of pilgrimage, and that the defendant thereafter sold the property to the plaintiff. It has been found by the Court below and indeed admitted by the plaintiff that at 'the time' of his purchase from the defendant, his knowledge of the defendant's title to the property was just as extensive as that of the defendant himself, that is to say, he' knew that the property had been purchased from a Hindu widow who had a limited interest, and that the widow could not legally transfer the property except for legal necessity, but it appears that both, parties to the contract for sale were doubtful of one point, viz., whether the sale by the widow to the defendant was for legal necessity. The sale-deed by which the defendant transferred the property to the plaintiff purports to transfer absolute ownership in the property. The plaintiff was in possession of the property from 1924 when he purchased it from the defendant until 1930 when he was dispossessed by a reversioner. The trial Court has however dismissed the plaintiff's suit for compensation on the ground that he had notice that his seller's interest was a limited one. The present application is made on the ground that, whether the plaintiff had notice or not, he' has a statutory right under Clause (2), Section 55, T.P. Act, the essential part of which is to the following effect:

The seller shall be deemed to contract with the buyer that the interest which the seller professes to transfer to the buyer subsists and that lie has power to transfer the same.

2. In the sale-deed the seller undoubtedly professes to transfer to the buyer the absolute' ownership of the property and, according to the argument for the applicant, he must be made to compensate the buyer now that his title has failed. A somewhat similar question is considered in the case of Muhammad Ibrahim, v. Nakched Ram (1909) 6 I.C. 890 where it was found by a Bench of this Court that the document of transfer

in clear and unambiguous terms transferred to the plaintiff the full rights of ownership...free from all encumbrances,

and that while certain references in the document might have been sufficient to put the' purchaser on his guard, these would only

operate to save the vendor from a charge of fraud, they were quite insufficient to relieve the vendor from the obligation imposed upon him by Section 55(2), T.P. Act.

3. In that case, it may be remarked, the lower appellate Court had held that the plaintiff either knew or ought to have known exactly what he was buying and that as he had knowingly bought a defective title the suit ought to be dismissed. But this decision was reversed by the High Court in appeal for the reasons I have quoted above. In a more recent decision on a similar point, a Bench of this Court in the case of Nawal Kishore v. Sarju Ram Sahu : AIR1932All546 following the decision in the case of Mohammad Ibrahim v. Nakched Ram (1909) 6 I.C. 890 and also a decision of the Calcutta High Court, held that unless the vendor's liability as imposed by Section 55(2), T.P. Act, was excluded by express covenant, his liability would be deemed to subsist notwithstanding the fact that the vendee

may have some idea as to the defect in the title of the vendor. In the Calcutta case it was stated that the vendee was entitled to rely on the assurance of title on the part of the vendor although he himself may have had some doubt as to it. We are of opinion that the view taken in Calcutta and in this Court quoted above is the correct view. The liability of the vendor clearly exists.

4. Now, there' is certainly no express covenant in the present case that the seller is to be released from the liability expressed in Section 55(2) and that liability, as I have already pointed out, is that he is deemed to contract with the buyer that the interest which the seller professes to transfer subsists and that he has power to transfer the sale. The interest which the seller professed to transfer was a complete proprietary title, and the reason why the Court below has not decreed the plaintiff's suit is that the buyer had notice of a cloud on the seller's title. In the circumstances it can hardly be held that notice would affect the buyer's statutory right, because even if he had full knowledge that the seller's interest was vulnerable, it may easily be inferred that he relied on his statutory right under Section 55(2) to protect himself against the risk he was taking. The Court has however referred to the decision of a Single Judge of this Court in the case of Kali Din v. Madho A.I.R. 1923 All. 169. It is certainly laid down there that Section 55(2) will apply in such a case

unless it be shown that the benefit of the rule 'was lost to the purchaser by a fraud, notice, 'waiver or express or implied contract.

5. Sir Louis Stuart, the Judge concerned, went on to consider whether in that case the buyer had had notice and found that he had not, but it is true that he would apparently have decided that the seller would have been protected if the buyer had had notice of the defect in the seller's title. The decision in the case of Nawal Kishore v. Sarju Ram Sahu : AIR1932All546 is however a more recent decision and as it is a decision of a Bench of two Judges of this Court it must have higher authority. I have been referred to two other decisions by Single Judges of different High Courts in which it is claimed that an opposite view has been taken. In the case of Ramasubba Iyer v. Mathia Kone : AIR1925Mad968 it was held that when the vendee_ is perfectly aware of the defect in title or existence of an incumbrance, there is no duty on the part of the' seller to inform the buyer of that of which the latter is perfectly aware. The question was raised in connexion with Clause (1), Section 55 and not Clause (2), and it may well be that it was not necessary for the seller to inform the buyer of facts which the latter already knew, but that does not appear to affect his obligation to make good to the buyer a loss which both know that the buyer might incur. In the case of Kulla Mal v. Umra (1921) 61 I.C. 604 a Single Judge of the Lahore High Court held that the doctrine of caveat emptor applies in such a case, but in this decision there is no reference to the provisions of the 'Transfer of Property Act. It is therefore clear that the great preponderance of authority in this Court is in favour of the present applicant, and I must hold that the decision of the Court below is not in accordance with law.

6. I therefore allow the application with costs, and direct that the decree and order of the trial Court be set aside and that the plaintiff be given a decree for the refund of the amount of the purchase money in addition to interest on this sum from the date of his dispossession to the date of the suit and thereafter pending and future interest at 6 per cent. As the plaintiff was in possession of the property for six years he has no equitable claim to interest from the date of the sale.


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