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Rati Ram and ors. Vs. Mam Chand and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtPunjab and Haryana High Court
Decided On
Case NumberSecond Appeal No. 13 of 1953
Judge
Reported inAIR1959P& H117
ActsTransfer of Property Act, 1882 - Sections 54 and 122; Code of Civil Procedure (CPC) , 1908 - Sections 100 and 101
AppellantRati Ram and ors.
RespondentMam Chand and ors.
Appellant Advocate D.K. Mahajan,; Mool Raj Mulick and; N.N. Goswamy, Ad
Respondent Advocate D.N. Aggarwal and; Rajindar Nath, Advs.
DispositionAppeal allowed
Cases Referred and TaraChand v. Baldeo
Excerpt:
.....payment of price or promise of payment of price leads to the irresistible conclusion that the transaction in dispute was not intended to be a sale. 5. it is well established that right of pre-emption is a piratical right and it imposes restriction on the right of the owner to transfer his property to whomsoever he likes. in case there exists a doubt about the transaction in question being a sale the plaintiff must fail. it is well established that it is open to a party to defeat a possible pre-emptor by all legitimate means. if, therefore, suraj bhan could adopt a device whereby he could hand over the land to the doneees without effecting a sale then i think he is well within his rights to do so. 279 of air): admittedly, the deed is in terms one of gift, and according to these terms..........the ground of having a preferential right of purchase than defendants nos. 2 to 6. a part of the land in dispute was already under a mortgage with a charge of rs. 12,000/-. therefore the plaintiffs sued for possession by pre-emption on payment of rs. 8,000/- only. 2. the defendants contested the suit and controverted the plea relating to the transaction being a sale. they, on the contrary, pleaded that the transaction was an out and out gift in favour of the defendants donees on account of natural affection for them as they were relatives. the preferential right of pre-emption claimed by the plaintiffs was also denied and the defendants also asserted that they were biswedars in the village. it was in the end asserted that the market value of the land in dispute was rs. 75,000/-. on the.....
Judgment:

I.D. Dua, J.

1. This is a defendants' appeal against the judgment and decree of the Additional District Judge, Rohtak, granting to the plaintiffs a decree for possession of the land in suit on the ground that the transaction in suit though described as a gift was a sale and that the plaintiffs had a preferential right to pre-empt the said sale. The plaintiffs alleged that the land mentioned in the plaint belonged to Suraj Bhan defendant No. 1 who transferred 5/6th share of the same measuring 101 bi-ghas and 9 biswas with shamilat rights to defendants Nos. 2 to 6 for a sum of Rs. 8,000/- on the 19th of December, 1946, besides the mortgage charge on this land.

The mutation was accordingly sanctioned on, the 26th of December, 1918. This mutation, the plaintiffs pleaded, though described as a gift, was in fact a sale. The plaintiffs who claim to be the collaterals of defendant No. 1 and also Biswedars filed a suit for pre-emption on the ground of having a preferential right of purchase than defendants Nos. 2 to 6. A part of the land in dispute was already under a mortgage with a charge of Rs. 12,000/-. Therefore the plaintiffs sued for possession by pre-emption on payment of Rs. 8,000/- only.

2. The defendants contested the suit and controverted the plea relating to the transaction being a sale. They, on the contrary, pleaded that the transaction was an out and out gift in favour of the defendants donees on account of natural affection for them as they were relatives. The preferential right of pre-emption claimed by the plaintiffs was also denied and the defendants also asserted that they were Biswedars in the village. It was in the end asserted that the market value of the land in dispute was Rs. 75,000/-. On the pleadings of the parties the following issues were framed : --

1. Whether the suit land was sold by defendant No. 1 in favour of defendants Nos. 2 to 6?

2. What was the sale price paid or fixed in good faith?

3. What is the market value?

4. If issue No. 1 be held in favour of the plaintiffs, have plaintiffs preferential pre-emption right as against defendants Nos. 2 to 6?

5. Relief.

While dealing with issue No. 1 the trial Courtconsidered the statements of plaintiffs' witnessesNos. 1 to 4 not worthy of any reliance. The evidence of these witnesses was sought by the plaintiffs to be brought on the record as direct evidence of the transaction in dispute being a sale.Having disbelieved this direct evidence the trialCourt, however, proceeded; to consider some circumstantial evidence and came to the conclusionthat the transaction in dispute was a sale. Thetrial Court considered the following circumstancesfor the purposes of arriving at the above conclusion :--

(i) Suraj Bhan defendant was 21 years old.

(ii) The area of land owned by him at the time of alienation measured 121 bighas and 15 biswas.

(iii) The land in dispute is subject to a charge of Rs. 12,000//.

(iv). The explanation given by the defendant in support of his motive for the gift in dispute did not appeal to the trial Court.

The trial Court observed after considering the above circumstances that a person who could not clear off the encumbrance of Rs. 12,000/- could not possibly be in such a financial position as to afford to alienate 101 bighas and 9 biswas to defendants Nos. 2 to 6 by way of gift simply on sentimental grounds. On this basis the trial Court came to the conclusion that this transaction must be held to be a sale.

3. On appeal the learned District Judge also on almost identical grounds dismissed the appeal. The Courts below have determined the market value of the property at Rs. 37,370/-; out of this the mortgage charge to the extent of Rs. 12,000/-has been deducted and the plaintiffs have been ordered to deposit a sum of Rs. 25,370/- representing the sale price of the land in dispute.

4. On second appeal on behalf of the vendees Mr. D. K. Mahajan has submitted that thereis absolutely no evidence on the record to suggestthat the transaction in dispute was a sale and thatthe Courts below have proceeded on bare conjecture in holding the transaction in favour of theappellants to be a sale and therefore liable to bepre-empted. In my opinion the learned counselis right. Sale has been defined in S. 54 of theTransfer of Property Act (Act IV of 1882) as follows : --

' 'Sale' is I transfer of ownership in exchange for a price paid or promised or part-paid and part-promised.'

On the present record there is absolutely no evidence showing that ownership of the land in dispute was transferred to the defendants-appellants in exchange for a price paid or promised or part-paid and part-promised. The oral evidence, led by the plaintiffs in support of the transaction being a sale, has been expressly disbelieved by the trial Court and does not seem to have been relied upon before the learned Additional District Judge on first appeal.

The circumstances on which both the Courts below have relied in coming to the conclusion that the transaction in dispute amounts to a sale do not at all justify the inference drawn by them. We havebeen taken through the evidence led in the case and in our view all that can be said is that had Suraj Bhan been more prudent, he would perhaps not have made a gift of the property in question to the defendants appellants. Such a finding cannot in my opinion, necessarily lead to the inference that the transaction in dispute is a sale.

It is in evidence that Suraj Bhan's father Laiku is the real brother of Ramji Lal who is married to Amar Singh's sister and Amar Singh is the father of the donees. Even the lower appellate Court observes that there was some connection between the parties which could be described in terms of relationship. It is also in evidence that this Amar Singh took Suraj Bhan (when he was a minor) under his protection and maintained him though out of the income of the laud belonging to him (Suraj Bhan minor).

There is also some evidence on the record that the donees including Rati Ham arranged for Suraj Bhan's marriage and even financed it. In this background it is not possible for me to hold the transaction in dispute to be necessarily a sale which has been concealed under the cloak of a gift. As stated above the price of the land after deducting mortgage charge has been determined by the Courts below to be Rs. 25, 370/-. There is no finding that this price was promised or paid or part promised and part paid.

The Courts below have, curiously enough, completely ignored this really material aspect of the case. Even if the whole or part of the price was originally promised it must, if the transaction were really a sale, be paid to the seller within a reasonable time. Considering the matter from this point of view if the transaction in dispute was in effect a sale and it was wrongly described as a gilt it would certainly have been possible for the plaintiffs, who claim to be collaterals of Suraj Bhan, to lead some evidence regarding either receipt of the whole or part of sale price by Suraj Bhan or payment by the donees to Suraj Bhan of the whole price or a substantial part of it.

Absence of any reliable evidence suggesting payment of price or promise of payment of price leads to the irresistible conclusion that the transaction in dispute was not intended to be a sale. It is possible that, out of regard for the donees and their father, Suraj Bhan got the land in dispute mulcted in favour of the donees who in return maintained him and looked after him but such a transaction cannot, in my opinion, be described to be a sale.

5. It is well established that right of pre-emption is a piratical right and it imposes restriction on the right of the owner to transfer his property to whomsoever he likes. This right operates as a clog on the right of the owner to alienate his property to a person of his own choice; it has therefore to be strictly construed. The plaintiff in a preemption suit, who is an aggressor, must in my opinion, prove affirmatively that the transaction which he wants to pre-empt is a sale and that be has a preferential right over the vendees; in case there exists a doubt about the transaction in question being a sale the plaintiff must fail.

The policy underlying the law of pre-emption is to keep out strangers and thus to maintain the privacy and compactness of joint owners. In the present changed condition of our society this trend is likely to obstruct and retard, instead of promoting, the economic and social progress of the community. In this view of the matter if the transaction in dispute is capable of two interpretations the Courts should, in my opinion, be disinclined to hold it to be a sale so as to force the owner of the property to transfer it to a person who is not of his choice.

It is well established that it is open to a party to defeat a possible pre-emptor by all legitimate means. If, therefore, Suraj Bhan could adopt a device whereby he could hand over the land to the doneees without effecting a sale then I think he is well within his rights to do so. The plaintiffs cannot ask the Court to treat it as a sale merely because, according to him, there appeared to be no adequate motive for Suraj Bhan to make a gift of the property to the donees. The learned counsel for the respondents has drawn our attention to Chiragh Din v. Allah Din. 70, Pun Re 1916; (AIR 1916 Lah 279), particularly to the following passage at page 209 if Pun Re); (at p. 279 of AIR):

'Admittedly, the deed is in terms one of gift, and according to these terms the gift (which comprised 12 kanals 2 marlas of land in Mauza Baghan-wala) was made by Nathu as some return for the services rendered to him at various times by his near kinsman and very good friend, Chiragh Din. The deed somewhat naively and ingenuously, states incidentally that the value of the property is Rs. 1,000/-.'

On those facts the learned Judges dealing with thar case held the transaction to he a sale. On the facts and circumstances of the reported case the learned Judges may have been right in holding the transaction to be a sale but, without expressing any final opinion as to whether, or not they were right, this ruling cannot in my opinion afford any useful guidance for us in deciding the instant case. With the utmost respect to the learned Judges who decided Chiragh Din's case 70 Pun Re 1916: (AIR 1916 Lah 279) I find .myself unable to agree with their approach to a pre-emption suit.

In my view, the burden lies heavily on the plaintiff to establish affirmatively that the transaction which he wants to pre-empt is a sale and nothing else. Merely because the defendants have not succeeded in affirmatively establishing the transaction in question to be a bona fide and genuine gift, it does not necessarily lead to the conclusion that it is a sale. In the reported case the value of the property having been mentioned as Rs. 1,000/-in the deed itself, appears to have weighed considerably with the learned Judges of the Chief Court in determining the nature of the transaction.

Those facts do not however bear any closeanalogy to the facts of the present case. I do notthink it will serve any useful purpose to discussMasih Hussain v. Allaha Diya, AIR 1947 Lah. 320,Bahawaj v. Amir, AIR 1939 Lah. 343 and TaraChand v. Baldeo, 117 Pun Re 1890 (FB) cited bythe learned counsel for , the respondents becausethey do not seem to me to bear any close resemblance to the facts of the case before us. I mightat this stage refer to the decision in Gul Muhammadv. Tota Ham 31 Ind Cas 221: (AIR 1915 Lah218), where it has been held that if the consideration for a transaction consists of a cash payment andalso of conveyance of some land to the vendor thenthe transaction being indivisible (partly saleand partly exchange) it could not be pre-empted asa sale. '

6. The learned counsel for the respondents had, however, strenuously urged that the Courts below have concurrently found that the transaction in question is a sale and this, being a finding of fact, is not open to attack on second appeal. As I have discussed above there is no evidence on the record proving the transaction in dispute to be a sale; the essential requisites of sale have not been established.From the proved facts on the record in my opinionno proper inference in favour of the transaction being a sale can be drawn and the Courts below have clearly erred in doing so.

This error is in my opinion clearly an error of law. Besides, the Courts below have also failed to approach the consideration of the case from a correct legal point of view. Instead of applying their mind to the question whether or not the transaction in dispute had been proved by the plaintiff to be a sale, they concentrated their attention on the question whether the defendants had established the transaction to be a genuine gift. This, in my view, was a wholly erroneous approach and has resulted in a decision which is contrary to law.

7. In the result, I allow the appeal and setting aside the judgment and decree of the Courts below dismiss the plaintiffs' suit with costs throughout.

D. Falshaw, J.

8. I agree.


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