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Arta Rout Vs. Bhagabat Baral and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtOrissa High Court
Decided On
Case NumberSecond Appeal No. 211 of 1953
Judge
Reported inAIR1957Ori157; 23(1957)CLT142
ActsTransfer of Property Act, 1882 - Sections 41
AppellantArta Rout
RespondentBhagabat Baral and anr.
Appellant AdvocateB. Mohapatra, Adv.
Respondent AdvocateH. Mohapatra and ;R.N. Misra, Advs.
DispositionAppeal dismissed
Cases ReferredLickbarrow v. Mason
Excerpt:
.....v smt gita banik, 1996 (2) glt 246, are not good law]. - 1. with regard to possession of the suit properties, he observed that the rent receipts filed by the plaintiff did not clearly show that they were paid in respect of the suit lands but were paid in respect of a land 1.83 acres in extent whereas the suit lands are 1.64 acres; that the rent receipts filed by the plaintiff do not clearly show that they appertain to the suit lands; but as the document could not be registered on that day, the document to be registered as well as the mortgage and the sale deed were with defendant no. 1/a) with the plaintiff is not of much significance and as i have already observed, as the finding of the appellate court based upon a careful discussion of the evidence that the possession of the..........case is that in order the screen the properties from his creditors he executed a nominal sale deed (ext. 1/a) in favour of his sister's son (defendant no. 2) who resides jn another village; that he continued to be in possession of the properties till the date of filing of the suit; that the sale deed executed by him was in his custody; that he was paying the rent due on the lands and that defendant no. 1 took a sale deed (ext. b/1) of these properties from defendant no. 2 and was threatening to dispossess him. hence he filed the suit for declaration of his title to the properties and for confirmation of possession. 3. delendant no. 2 was ex parte in the case. he was also not examined by any party. defendant no. 1 contended that the sale deed in his favour was executed for a sum.....
Judgment:

P.V.B. Rao, J.

1. The plaintiff files this appeal against the reversing judgment of the Additional Subordinate Judge of Puri dismissing the suit fordeclaration of the title and confirmation of possession with regard to 1.64 acres of land situated in Apila.

2. The plaintiff's case is that in order the screen the properties from his creditors he executed a nominal sale deed (Ext. 1/a) in favour of his sister's son (defendant No. 2) who resides jn another village; that he continued to be in possession of the properties till the date of filing of the suit; that the sale deed executed by him was in his custody; that he was paying the rent due on the lands and that defendant No. 1 took a sale deed (Ext. B/1) of these properties from defendant No. 2 and was threatening to dispossess him. Hence he filed the suit for declaration of his title to the properties and for confirmation of possession.

3. Delendant No. 2 was ex parte in the case. He was also not examined by any party. Defendant No. 1 contended that the sale deed in his favour was executed for a sum of Rs. 1000/- which was paid to the vendor; that he was in possession of the properties; and that the sale deed in favour of defendant No. 2 executed by the plaintiff was a real and bona fide transaction, it having been executed for the purpose of discharging the previous debts of the plaintiff.

4. The sale deed in favour of defendant No. 2 (Ext. 1/a) was executed by the plaintiff for a sum of Rs. 300/- on 2-12-41. The sale deed in favour of defendant No. 1 (Ext. B/1) was executed by defendant No. 2 for a sum of Rs. 1000/- on 29-4-50, Subsequent to the execution of this sale deed and within a month from that date, defendant No. 2 executed a deed of cancellation (Ext. 2) of the sale deed in favour of defendant No. 1 reciting in the same that in the sale deed (Ext. B/1) in favour of defendant No. 1 he intended to sell some other properties and not the properties actually conveyed under the said sale deed.

5. The learned Munsif decreed the suit mainly on the ground of the plaintiff having the custody of the sale deed executed by him and on the ground that the plaintiff was in possession of the properties even after the execution of the sale deed till the date of the suit. He held that the motive alleged for the transaction of 1941 was not improbable. He, also held that the sale deed was not for consideration.

The learned Additional Subordinate Judge, after a very careful discussion of the evidence in the case. held that there was no motive and no reason to execute a benami sale deed in favour of defendant No. 2 and the motive alleged was not established; that the sale deed (Ext. I/a) on the strength of the evidence of D. W. 3 was for consideration and that the trial Court erroneously placed the onus of proving the passing of consideration on defendant No. 1. With regard to possession of the suit properties, he observed that the rent receipts filed by the plaintiff did not clearly show that they were paid in respect of the suit lands but were paid in respect of a land 1.83 acres in extent whereas the suit lands are 1.64 acres; that the custody of the document was with the plaintiff; and that the plaintiff was in actual physical possession of the lands.

6. Mr. B. Mohapatra, the learned counsel for the appellant Strenuously contended that the findings of the appellate Court that the plaintiff was incustody of the sale deed impugned and that he was in possession of the properties are enough to come to a conclusion that the sale deed executed by the plaintiff in favour of defendant No. 2 was a benami transaction; and that the learned Additional Subordinate Judge erred in placing the burden of proof upon the plaintiff.

The circumstances present in this case, namely, that defendant No. 2 is the sister's son of the plaintiff; that there was a mortgage in favour of Nilakantha, brother of defendant No. 2 (Ext. 4) which according to defendant No. 1, was discharged by the consideration amount received under Ext. 1/a; that the possession found in favour of the plaintiff by the lower appellate Court was only actual physical possession and not juridical possession; that the rent receipts filed by the plaintiff do not clearly show that they appertain to the suit lands; and that defendant No. 2 resides in a different village are circumstances which place a heavy burden on the plaintiff to prove that the transaction is actually a nominal transaction. D. W. 1, the scribe of the sale deed (Ext. B/1) in favour of defendant No. 1 gave evidence that at the time the sale deed was drafted and executed, both the mortgage (Ext. 4) in favour of Nilakantha and the sale deed (Ext. 1/a) in favour of defendant No. 2 were there.

But as the document could not be registered on that day, the document to be registered as well as the mortgage and the sale deed were with defendant No. 2 and on the next day when the document was registered, defendant No. 2 did not bring the mortgage bond and the sale deed to the office of the Sub-Registrar and said that he would give them to defendant No. 1 after the registration was completed.

The fact that immediately after the execution of the sale deed in favour of defendant No. 1, defendant No. 2 executed a deed of cancellation (Ext. 2) and the plaintiff filed the suit for declaration of his title go to show that after the execution of the sale deed in favour of defendant No. 1, the plaintiff, and his sister's son (defendant No. 2) colluded together and defendant No. 2 must have handed over the sale deed in his favour to the plaintiff.

In this view of the matter, the physical custody of the document (Ext. 1/a) with the plaintiff is not of much significance and as I have already observed, as the finding of the appellate Court based upon a careful discussion of the evidence that the possession of the plaintiff was only actual physical possession, I am of the view that the so-called custody and the actual physical possession are not very strong circumstances in order to hold that the sale deed executed by the plaintiff in favour of defendant No. 2 was a nominal transaction. The decision of the lower appellate Court that the plaintiff failed to prove that the transaction was a nominal one is, in my opinion, correct.

7. Mr. H. Mohapatra, the learned counsel for the respondents raised a contention that the plaintiff is estopped under Section 41 of Transfer of Property Act from filing the suit. The learned Munsif on this point held that it cannot be disputed that Ext. B/l the sale deed in favour of defendant No. 1 by defendant No. 2 is for consideration as an endorsement on the back of it shows that a sum of Rs. 1000/- was paid in presence of the Sub-Registrar.

But, in his opinion, as there was no evidence either that the plaintiff gave his consent to defendant No. 2 to execute the sale deed Ext. B/l or that defendant No. 1 acted in good faith and made enquiries regarding the power of the transferor, defendant No. 1 cannot invoke Section 41 of the Transfer of Property Act. The learned Additional Subordinate Judge simply stated that he would agree that there was no evidence that the plaintiff gave his consent to defendant No. 2 either express or implied for the transfer to defendant No. 1. In my opinion, there is no doubt that both the learned Munsif and the learned Additional Subordinate Judge did not correctly understand the provision of Section 41 of the Transfer of Property Act.

8. Section 41 of the Transfer of Property Act is as follows :

'Where, with the consent, express or implied, of the persons interested in immovable property, a person is the ostensible owner of such property and transfers the same for consideration, the transfer shall not he voidable on the ground that the transferor was not authorised to make it : provided that the transferee, after taking reasonable care to ascertain that the transferor had power to make the transfer, has acted in good faith.'

In the leading case on this point in Ramcoomar v. McQueen, reported in 18 Suth WR 166 (A), the Judicial Committee laid down,

'It is a principle of natural equity, which must be universally applicable, that where one man allows another to hold himself out as the owner of an estate and a third person purchases it, for value, from the apparent owner in the belief that he is the real owner, the man who so allows the other to hold himself out shall not be permitted to recover upon his secret title unless he can overthrow that of the purchaser by saying either that he had direct notice or something, which amounts to constructive notice of the real title, or that there existed circumstances which ought to have put him upon an enquiry that, if prosecuted, would have led to a discovery of it.'

The principle underlying Section 41 of the Transfer of Property Act applicable to the present case is laid down at page 186 of the 4th Edition of the Transfer of Property Act by D. F. Mulla edited by Hon'ble Mr. Justice S.R. Das, Chief Justice of the Supreme Court to the effect,

'A benamidar is an ostensible owner and if a person purchases from a benamidar, the real owner cannot recover unless he shows that the purchaser had actual or constructive notice of the real title.'

In the case of Swaminath Pillai v. Krishna Padayachi, reported in. AIR 1942 Mad 28 (B), a Division Bench of the Madras High Court consisting of Leach C. J. and Chandrasekhara Ayyar J. observed :

'Wherever one of two innocent persons has to suffer by the act of a third person, the person who is enabling the third person to occasion the loss must sustain it'

following the principle laid down in the case of Lickbarrow v. Mason, reported in (1787) 2 TR 63 (C). Here defendant No. 2 was enabled by the plaintiff to occasion the loss. Even if the plaintiff was an innocent person, along with defendant No. 1 it is the plaintiff who has to sustain the loss. The plaintiff executed the sale deed Ext. 1/A in favourof defendant No. 2 admittedly for screening the properties against his creditors.

On the strength o the sale deed in favour of defendant No. 2 and the mortgage bond discharged with the consideration of the sale deed and according to the evidence of D. W. 1 who is the scribe ot Ext. B/1 when the sale deed in favour of defendant No. 1 was executed, defendant No. 1 acted on the strength of the title deeds in favour of defendant No. 2. The actual physical possession by the plaintiff of the suit properties situated in a different village is not shown to be to tho knowledge of defendant No. 1 and even it defendant No. 1 was aware of the actual physical possession of the properties by the plaintiff, that possession is not inconsistent with the title of the properties in defendant No. 2 as the actual possession may be consistent with holding the lands as a lessee from defendant No. 2.

In this view of the matter, defendant No. 1 is also a bona fide purchaser in good faith. The lower appellate Court did not discuss this question in length. The learned Additional Subordinate Judge merely stated that he agreed with the opinion of the learned Munsif that there was no evidence that the plaintiff gave his consent to defendant No. 2 either express or implied for the transfer to defendant No. 1. He did not express any opinion as to the want of bona-fideness on the part of defendant No. 1. But both the learned Munsif and tho learned Additional Subordinate Judge were wrong in thinking that there should be plaintiff's consent to defendant No. 2 to transfer the properties to defendant No. 1, either express or implied.

This is not what is contemplated under Section 41 of the Transfer of Property Act. This section only requires that with the consent, express or implied, of the plaintiff, defendant No. 2 is tho ostensible owner of such properties and he is such by reason of Ext. 1 (A) executed by plaintiff and deals with a transfer made by the said ostensible owner and if the transferee, after reasonable ascertainment that the transferor had power to make the. transfer, acted in good faith. On a view of the title deed in favour of defendant No. 2 and the discharged mortgage bond, defendant No. 1 took the transfer from the transferor who had certainly power to make tho transfer under Ext. 1/A. In my opinion therefore, the plaintiff cannot avoid the sale made by him of the suit properties in favour of defendant No. 2.

9. For the reasons stated above, I am of opinion that the appeal is bound to fail. The appeal is,therefore, dismissed with costs.


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