1. This is a plaintiffs appeal under the Letters Patent from a judgment of a learned Judge of this Court reversing the decree of the lower Appellate Court.
2. It appears that one Inayat Khan and his three brothers were entitled to 5-6th share in a village, the remaining l-6th belonged to a lady. Instead of mortgaging his l-4th out of the 5-6th, Inayat Khan made a mortgage of 1-4th share in the village to the present plaintiffs. This came to about 17 bighas odd and the remaining l-4th of l-6th came to about 2 bighas. Subsequently a sale-deed was taken from the lady in the names of the sons of Inayat Khan and their wives whose names were entered in the revenue papers. The defendants, in execution of a money decree against the sons and their wives, got 1-4th of l-6th share belonging to the lady attached and put up for sale, and they purchased it themselves. Now, the plaintiffs have brought this suit for sale on the basis of their mortgage-deed and wish to enforce the security against the extra share, namely 1-4th of 1-6th which had been included in the mortgage, but which at that time did not belong to Inayat Khan. In the plaint there was no reference to Section 43, Transfer of Property Act, and accordingly there was no issue on this point, but the point appears to have been pressed before the trial Court which went into the question. The point was again considered by the lower Appellate Court and the lower Appellate Court came to the conclusion that the plaintiffs were entitled to enforce their equitable right under Section 43 against the defendants auction--purchasers. On appeal a learned Judge of this Court felt that the question of Section 43 being a mixed question of law and fact ought to be investigated. He accordingly sent down two issues to the Court below for determination with liberty to the parties to produce fresh evidence. The findings returned by the lower Appellate Court were to the effect that Inayat Khan was the real owner and that his sons and their wives were mere benamidars and that the plaintiffs were entitled to enforce their rights against the defendants.
3. The learned Judge of this Court , on the basis of these findings, came to the conclusion that in spite of them the suit should fail as regards this extra share. The basis of this decision is that the word 'transferee' in the proviso to Section 43 is wide enough to cover an auction-purchaser and that therefore the present defendants who purchased the property for consideration and in good faith and without notice of this equitable charge are protected. He further expressed the opinion that the defendants, having purchased the supposed interests of the benamidars who were the ostensible owners of the property with the implied consent of Inayat Khan, are entitled to protection on account of Inayat Khan's conduct. In appeal it is urged before us that neither Section 41 nor the proviso to Section 43 can apply to an auction--purchaser.
4. It is significant to point out that the preamble to the Transfer of Property Act, suggests that it was to define and amend certain parts of the law relating to transfer of property by act of parties that the Transfer of Property Act was passed. Section 2(d) also indicates that nothing in the Act is to affect any transfer by operation of law, or by, or in execution of, a decree or order of a Court of competent jurisdiction save as provided by Section 57 and Chap. IV of the Act. Both Sections 41 and 43 are based on the principle of estoppel where, on a representation made by one party and acted upon by another, the rights of the latter are prejudiced so as to enable him to the benefit of the principle of estoppel as against the other. It may therefore be very doubtful whether the word 'transferees' in the proviso to Section 43 would expressly cover an auction--purchaser. But we think that in this particular case it is not necessary to express any final opinion on this point.
5. The defendants are auction-purchasers of the right, title and interest of Inayat Khan's sons and their wives. They are not people who have taken a voluntary transfer from the ostensible owners. Indeed they made the purchase without the consent, and it may well be, against the will of their judgment-debtors. Inayat Khan no doubt had put his sons and their wives in possession and was holding them out to be ostensible owers to the world. But the defendants have not acquired rights by virtue of any act directly done by these ostensible owners, but have acquired the property under an involuntary or compulsory sale and therefore prima facie against the will or at any rate without the consent of these ostensible owners.
6. Section 41, Transfer of Property Act, applies to a case where the true owner allows his benamidar to remain in possession of the property as an ostensible owner and to deal with it as full owner. Where such ostensible owner 'transfers' property to a person who takes it in good faith after having taken reasonable care to ascertain that the transferor had power to make the transfer, the transaction binds the true owner. But obviously the transfer spoken of ins. 41 must be a voluntary transfer which is affected by an act of the ostensible owner. On this point there is a direct authority of this Court , namely, Mangat Lal v. Ghasi Khan : AIR1929All800 ; Ind. Rul.(1929) All.926, which does not appear to have been brought to the notice of the learned Judge of this Court . The learned Judges were of opinion that in view of the language of Section 41 it would not be applicable to auction-purchasers.
7. It is also equally clear that the Bench did not think that any general principle underlying Section 41 would be applicable to auction-purchasers. Indeed it is difficult to see how such a principle would be applicable, because auction-purchasers are not expected to take any reasonable care to ascertain that the judgment-debtor has any power to make the transfer. They merely purchase the right, title and interest if any, of the judgment-debtor which are pat up for sale and take a certain amount of risk in bidding for the property.
8. We are, therefore, of opinion that even if either the proviso to Section 43 or any principle underlying that section were applicable to an auction purchaser like the defendants-respondents, that principle is of no avail to them because they have not taken the property from Inayat Khan himself, but purchased at auction the rights and interest of his sons and wives, who were his benamidars and who are now found to have no title. They are not entitled to the protection afforded by Section 41, Transfer of Property Act, nor by any principle on which that section is based. We must, therefore, allow this appeal and setting aside the decree of the learned Judge of this Court restore that of the lower Appellate Court. In view of the fact that the plea of Section 43 was not raised in the plaint, but relied upon by the plaintiffs, and an issue had to be remanded and fresh evidence recorded, we direct that the parties do bear their own costs of both the hearings in this Court .