1. This appeal has been filed by defendants 4 to 6 against the judgment and decree of the District Judge. Karnal, dt. l8th January, 1974.
2. Briefly, the facts are that the plaintiff migrated from Pakistan to India at the time of partition of the country. He owned land in West Pakistan and in lieu thereof he was allotted 9 Standard Acres 13 Units of land in village Rohti, District Kurukshetra, by the Rehabilitation Authorities. Later it was discovered that part of the land in Pakistan stood mortgaged with the Muslims, Consequently, the notice dt. l9th July. 1960, was issued by the Managing officer to the plaintiff to appear before him on 1lth Aug. 1950, and inform him whether the plaintiff wanted to pay the mortg-age-.money or get. his allotment cancelled. The plaintiff did not appear before the Managing Officer. Consequently, in lieu of the mortgaged land measuring 5 Standard Acres 1 Unit, the allotment of she plaintiff to the extent of 3 Standard Acres 121/2 units was cancelled vide order dated 13th Aug. 1960. Later. on 7th Feb. 1964. the retrieved area was sold by public auction and it was purchased by Qandhara Singh and Malik Singh defendants Nos. 4 and 3. respectively, for Rs. 5,6001-. Malik Singh defendant further sold his share to defendants Nos. 4. 5 and 6. The plaintiff has averred that the order of the Managing Officer cancelling his allotment was illegal. void and without jurisdiction. Consequently, he filed a suit for possession of the said land.
3. The suit was contested by defendants Nos. 1. 2 and 4 to 6 who controverted the allegations, of the plaintiff. They inter alia-pleaded that the order dated 13th Aug. 1960, was valid and legal. that defendants Nos. 3 to 6 were bona fide transferees for. valuable consideration and protected under Section 41 of the T. P. Act and that the plaintiff is also estopped from filing the suit by his act and conduct.
The trial Court framed the following issues._
1. Whether the cancellation of allotment of agricultural land in favour of the plaintiff (now respondent No. 3) by the Rehabilitation authorities is contrary to law?
2. Whether defendant Nos. 3 to 6,(now respondent No. 4 and the appellants)are bona fide transferees for valuable consideration and are protected under See. 41 of the Transfer of Property Act?
3. Whether the notice under See. 80, C.P.C.. served on defendants Nos. 1 and 2) (now respondents Nos. 1 and 2) is illegal?
3-A Whether the plaintiff is estopped from filing the present suit by his act and conduct as alleged in para 4 of the preliminary objection in the written statement filed by defendant No. 4?
4. Relief. 4. The learned trial Court decided issues Nos. 1 to 3 in favour of the plaintiff. However it did not decide issue No. 3-A. In view of the aforesaid findings, it decreed the suit of the plaintiff. Defendants Nos. 4 to 6 went up in appeal before the District Judge who affirmed the Judgment and decree of the trial Court and dismissed the same. They have come up in second appeal to this Court.
5. The case came up for hearing be-fore me on 19th November, 1982. On that date. the counsel for the appellants brought it to my notice that no decision had been given on issue No. 3-A. where as evidence had been led. Consequently I remanded the case under order 41, Rule 25 of the Code of Civil Procedure. directing the Courts below to send their reports on the said issue. The reports have been received and both the Courts have given opinion on issue No. 3-A against the defendants.
6. The first contention of the learned counsel for the appellants is that the order of cancellation of allotment of the land in favour of the plaintiff-respondent by the. Rehabilitation authorities is legal and valid., and the Courts below have taken an erroneous view.
7. I have duly considered the argument of the learned counsel but regret my inability to accept the same. It is not necessary to examine the matter at length as it has already been examined in Shiv Dayal v. Union. of India (1964) 66 Pun LR 770, and followed in Budha Ram v. Behari Lal (1959) 71 Pun LR 93
8. In Shiv Dayal's case (supra), the question was whether the Chief Settlement Commissioner had the power to cancel the permanent rights of an allottee in respect of an area allotted in lieu of the land under mortgage with the Muslim residents in West Pakistan on his failure or refusal to deposit the mortgage money. The case was decided by a Division Bench consisting of A. N. Grover and Gurdev Singh. JJ. The Division Bench came to the conclusion that the Chief Settlement Commissioner had no authority to cancel the allotment because of failure or refusal of the allots tee to deposit the mortgage amount Gurdev Singh, J., while concurring with A. N. Grover. J. also gave another cogent reasons for that conclusion. it is neither the Chief Settlement Commissioner nor the Managing officer had any authority to demand from the allottees the payment of mortgage debt owed by them to the Muslims residing in Pakistan. This view was followed by P. C. Pandit. J. in Budha Ram case (1969-71 Pan LR 93) (supra). From the above ratio, it is evident that the learned Judges are of the view that the Rehabilitation authorities are not competent to cancel the proprietary rights on the ground that the allottees failed to pay the mortgage money which was due to the Muslim residents with whom the land was mortgaged in West Pakistan. I am in respectful agreement with the said observations.
9. After taking into consideration all the facts and circumstances of the case, I am of the opinion that the Courts below have rightly held that the order of cancellation of allotment of land passed against the plaintiff is bad. Consequently. 'I affirm the findings of the Courts below in this regard.
10. Issues Nos. 2 and 3-A are interconnected and I propose to deal with them together. Section 41 of the Transfer of Property Act provides that 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 be voidable on the ground that the transferor was not authorised to make it. A rider has been added to the section which provides that the transferee after taking reasonable care to ascertain that the transferor, had power to make the transfer, should act in good faith. The law of estoppel is contained in Section 115 of the Evidence Act. It is well-settled that Section 41 is a statutory application of the law of estoppel. Reference may be made to Kovvuri Satyanarayanamurthi v. Tatali Pydayya. AIR 1943 Mad 459. wherein it has been held that Section 41 is another species of estoppel when the representation is not made directly to the representee but when it consists in making it possible for the ostensible owners to mislead these with whom they are dealing on account of the, special position of vantage in which they were placed by the conduct. express or implied. of the real owners. The general principle of law of estoppel has been enunciated by the House of Lords in Cairacross v. Lorimer, (1860) 3 Macq 827. 829. in the following terms:--
'If a man either by words or by conduct, has intimated that he consents to an act which has been done and that he will offer no opposition to it. although it could not have been lawfully done without his consent. and he there-by induces others to do that. from which they might have abstained-he can not question. the legality of the act he had so sanctioned to the prejudice of those who have so given to his words or to the fair inference to be drawn from his conduct.
Reference may also be made to Swaminatha v. Krishna, AIR 1942 Mad 28. in which a Division Beach of Madras High Court has held that where one of the two innocent persons have to suffer by the act of a third person. the person who has enabled the third person to cause. the loss must sustain it.
11. Adverting to the facts of the present case. the order of cancellation of allotment of the land was passed in August. 1960. Thereafter the plaintiff took it on lease from the Rehabilitation Authorities and started paying the lease money to it. Thus, he admitted that the Department was the owner of the property and he was a tenant under it. The property was later auctioned and purchased by defendants Nos. 3 and 4. The plaintiff made an application for can-collation of the auction on the ground that he was ready to pay higher price, On his. representation, it was reauctioned. At the time of re-auction, the plaintiff was not only present there but he competed in the bid with defendants Nos. 3 and 4. When he was unsuccessful in outbidding the said defendants, he filed the present suit. The plaintiff also did not challenge the order of the Managing officer cancelling the allotment by way of appeal. From the above circumstances. it is evident that the conduct of the plaintiff was such that defendants Nos. 3 and 4 were led to a belief that the plaintiff consented to the sale of the property and the purchasers acted in good faith in purchasing it at the time of auction.
12. Mr. Narula. learned counsel for the plaintiff-respondent laid emphasis on the statement of the Plaintiff dated 10th January 1973. wherein he stated that he stopped defendants Nos. 3 and 4 to purchase the land at the time of auction and that we further stopped Gurbaksh Singh when he purchased it from the statement it is clear that the defendants know that the title of the Rehabilitation Department was defective and it cannot be said that they acted in good faith
13. I regret my inability to accent the contention. The statement, to my mind appears to he an after-thought. On the same day before the plaintiff was examined. Malik Singh entered the witness-box as D5WI. No question regarding the aforesaid facts put to him in cross-examination. If the version of the plaintiff-respondent had been correct that story would have been put to Malik Singh defendant. On the other hand, the plaintiff's participation in the auction and payment of lease money to the Rehabilitation Authorities go a long way to show that the defendants believed that no dispute had been left between the plaintiff and the rehabilitation Authorities. In this situation, it cannot be held that they did not act in good faith.
14. Mr. Narula has further urged that the order of cancellation of allotment in favour of the plaintiff was void and. therefore. the principle as laid down in. Section 41 or that of estoppel will not apply to him.
15. I am not impressed with this submission of the learned counsel as well. If the Plaintiff was considering the transaction void, he should not have either paid the lease money or taken part in the bid. That conduct of the plaintiff was such that a purchaser at the time of auction could take it that the plaintiff did not claim the property. Mr. Narula referred to Ramarao Jankiram Kadam v. State of Bombay, AIR 1963 SC 827, Summa Ram v. Chain Singh. AIR 1971 Punj & Har 259 and Assistant Custodian Evacuee property v. Brij Kishore Agarwala (1975) 1 SCC 21: AIR 1974 SC 2325). All the above cases are distinguishable. In Ramarao Jankiram Kadam's. case (supra), the plaintiff did not bid at the auction nor did he act in such a way which gave a belief to the purchaser that he was claiming the property. Similarly, in Summa Ram's case (supra). the plaintiff did not participate in the auction nor there was any such conduct which led the others to believe that he was not claiming the property. In Brij Kishore, Agarwal's case (supra). Mrs. Zohra Naqvi, wife of a Police official who was in Tehran, purchased the purchased the in Lucknow. she did not return to India till 1962 when the property was sold to the sons respondent No. 1, Before the purchase of the property, respondent No. 1 sought information from the Assistant Custodian whether the property was evacuee property or not and received the reply in the negative. Later, in n1963, the Assistant Custodian passed an order declaring the property as evacuee. The plea of estoppel was taken on the ground that the respondent had made an inquiry from the Assistant Custodian regarding the nature of property and he was informed that the property was not evacuee property. It was held by the supreme court that the fact that the first respondent made an inquiry from the Assistant Custodian whether the property was an evacuee property and was told that it was not does not make any difference to the situation that the property being evacuee property vested in the Custodian. consequently the appeal was accepted. While coming to that conclusion, the Supreme Court relied on the observations of Lord Normand in Howell v. Falmouth Boat Construction Co. Ltd. (1951) AC 837, wherein it was said that it was certain that neither a minister nor any subordinate officer of the Crown could by any duct or representation bar the Crown from enforcing a statutory prohibition or entitle the subject to maintain that there had been no breach of it. It is thus evident that the facts of the above case were different and Mr. Narula cannot derive any benefit from the above observations.
16. After taking into consideration all the aforesaid facts and circumstances, I am of the opinion that the appellants are entitled to the benefit of section 41 and the principle of estoodel.
17. For the aforesaid-reasons, I accept the appeal with costs set aside the judgments and decrees of the Courts below and dismiss the suit of the plaintiff-respondent.
18. Appeal allowed.