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Thadigadapa Jayalakshmamma and anr. Vs. Guntupalli Ramachandrayya - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai
Decided On
Reported inAIR1943Mad711; (1943)2MLJ285
AppellantThadigadapa Jayalakshmamma and anr.
RespondentGuntupalli Ramachandrayya
Cases Referred(see Pir Baksh v. Mahomed Taher
Excerpt:
.....of sale in respect of the property in favour of a third party is a serious defect in the seller's title to the property as the sale would be liable to be defeated if the transferee had notice of such contract (see section 40 and the illustration). the saving in this provision of a transferee for consideration and without notice of the contract is an equitable provision made for his protection and cannot have the effect of making the vendor's title capable of being validly sold. it would be a strange thing, as it seems to me, to hold that the petitioners had a 'saleable interest' in the property in question on the relevant dates when a sale to any other person after due disclosure as provided in section 55(1)(a)would be liable to be defeated at the instance of the respondent. it follows..........agreement to sell which was entered into on 2nd january, 1930. it is no doubt settled law that a contract of sale even when accompanied by delivery of possession is no defence to an action of ejectment in india as title to tangible immovable property of the value of rs. 100 and upwards does not pass in the absence of a registered instrument of sale (see pir baksh v. mahomed taher (1934) 67 m.l.j. 865 : 1934 l.r. 61 indap 388 : i.l.r. 58 bom. 650 (p.c.) and it is also true that section 53-a does not avail the respondent in the circumstances of this case. the question, however, is not whether the petitioners had title to the property on 1st october, 1937 and 22nd march, 1938, but whether they had a 'saleable interest' in the property notwithstanding the agreement to sell which, it has.....
Judgment:

Patanjali Sastri, J.

1. The petitioners applied to the lower Court under Section 19 of the Madras Agriculturists' Relief Act, 1938, to scale down a mortgage decree passed against them. The relief was refused on the ground that the petitioners were not agriculturists within the meaning of the Act at all material times. Hence this civil revision petition.

2. The petitioners' claim to be agriculturists rests on the alleged possession of a ' saleable interest' in a certain plot of land which they had contracted to sell to the respondent decree-holder for Rs. 1,575 which was to be adjusted in pro tanto reduction of the mortgage debt due to the latter. In his suit to enforce the mortgage, the respondent ignored this contract and claimed the full amount due according to the tenor of the bond, but the petitioners pleaded partial discharge on the basis of the contract alleging that they had delivered possession of the property to the respondent and were always ready and willing to execute a sale deed but the respondent refused to accept it owing to depreciation in the value of lands. The Court found that the petitioner's case was true and passed a decree for the balance due after deducting the sum for which the land was agreed to be sold. This decree was finally confirmed by this Court on second appeal in September, 1937. It appears that a sale deed was actually executed in favour of the respondent on 22nd April, 1940.

3. Now, according to the decision of this Court in Palani Goundan v. Peria Goundan : AIR1941Mad158 an applicant for relief under Section 19 of the Act should show that he was an agriculturist on 1st October, 1937, 22nd March, 1938, and the date of the application which in this case was 12th June, 1942. With reference to this last date the petitioners rely upon a sale deed, Ex. P (1) dated 9th June, 1942, under which they claim to have acquired another plot of agricultural land, but with reference to the two earlier dates they seek to establish their agriculturist status on the basis that the title to the piece of land which they agreed to sell and actually delivered to the, respondent still remained with them in the absence of a registered deed of conveyance which was executed only on 22nd April, 1940, as aforesaid. It is argued that under the Transfer of Property Act a mere contract to sell even when it is followed by delivery of possession to the proposed vendee creates no interest in the latter in respect of the immovable property agreed to be sold when such property is more than Rs. 100 in value, and that accordingly the legal title to the land covered by the agreement still remained vested in the petitioners so that, as the owner of such land, they were entitled to claim the benefits of the Act. It is also pointed out that Section 53-A of the Transfer of Property Act embodying the principle of part performance does not assist the respondent as the section was newly inserted in the Act with effect from 12th April, 1930, and has no retrospective operation as held by a Full Bench of this Court in Kanakamma v. Krisknamma : AIR1943Mad445 so as to affect the agreement to sell which was entered into on 2nd January, 1930. It is no doubt settled law that a contract of sale even when accompanied by delivery of possession is no defence to an action of ejectment in India as title to tangible immovable property of the value of Rs. 100 and upwards does not pass in the absence of a registered instrument of sale (see Pir Baksh v. Mahomed Taher (1934) 67 M.L.J. 865 : 1934 L.R. 61 IndAp 388 : I.L.R. 58 Bom. 650 (P.C.) and it is also true that Section 53-A does not avail the respondent in the circumstances of this case. The question, however, is not whether the petitioners had title to the property on 1st October, 1937 and 22nd March, 1938, but whether they had a 'saleable interest' in the property notwithstanding the agreement to Sell which, it has been assumed throughout the argument, was enforceable by a' suit for specific performance on the relevant dates. It was suggested that the petitioners were then in a position to pass a valid title to a bona fide purchaser for value without notice of the agreement and had thus a ' saleable interest ' in the property. But 'saleable' cannot mean capable of being sold by the prepetration of a fraud; for Section 55(1)(a) lays upon the seller the duty to disclose to the buyer any material defect in the seller's title to the property of which the seller is and the buyer is not aware and which the buyer could not with ordinary care discover; and the last paragraph of the section provides that an omission to make such disclosure is fraudulent. It cannot be doubted for a moment that an enforceable contract of sale in respect of the property in favour of a third party is a serious defect in the seller's title to the property as the sale would be liable to be defeated if the transferee had notice of such contract (see Section 40 and the illustration). The saving in this provision of a transferee for consideration and without notice of the contract is an equitable provision made for his protection and cannot have the effect of making the vendor's title capable of being validly sold. It would be a strange thing, as it seems to me, to hold that the petitioners had a ' saleable interest' in the property in question on the relevant dates when a sale to any other person after due disclosure as provided in Section 55(1)(a)would be liable to be defeated at the instance of the respondent. It follows that the petitioner was not an agriculturist within the meaning of Section 3(ii) of the Madras Agriculturists' Relief Act on the material dates and his application for relief under the Act must fail.

4. The petiton is dismissed with costs.


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