1. This second appeal raises an important question on the construction to be placed on the wording of Section 41, T. P. Act. The facts that led to this appeal are these.
2. The appellants are defendants 8 to 11,13 and 14 who are the sons and daughters of one Ahmed Sahib. Respondents 1 to 5 are the representatives of Katta Subbayya the plaintiff in the suit. The other respondents are the heirs of one Bhandigi Sahib. Ahmed Sahib and Bhandigi Sahib were brothers. Bhandigi Sahib was a police head constable and had retired from service and settled in his native village. The other brother Ahmed Sahib was in service as a Sub-Inspector of Police and it appears that he sent a large sum of money to his brother Bhandigi Sahib. With the moneys so sent by Ahmed Sahib, Bhandigi Sahib purchased properties in his own name. The plaintiff Katta Subbayya took a simple mortgage from Bhandigi Sahib (Ex. B) on 6th August 1928. This was in order to pay off a debt due to one Mr. M. G. Rameswara Rao who was a leading advocate of Anantapur and now dead. Later on the plaintiff obtained a usufructuary mortgage in discharge of the simple mortgage which he had obtained in 1928. Exhibit A is the usufructuary mortgage deed dated 12th September 1930. In between the simple mortgage and the usufructuary mortgage, Ahmed Sahib filed a suit in the District Munsif's Court of Anantapur to enforce his right to the property in suit on the ground that the property having been purchased with the funds advanced by him was really his own property and not that of Bhandigi Sahib. The plaint was returned to be presented to the proper Court as the value of the property exceeded the jurisdiction of the District Munsif's Court and thereupon it was presented to the higher Court. The order of returning the plaint to be presented to the proper Court was passed on 24th September 1930. Exhibit A the usufructuary mortgage was thus effected at a time when the suit was pending in the District Munsif's Court and a few days after the usufructuary mortgage, the order returning the plaint to the proper Court was passed. At the time when the simple mortgage was taken on 6th August 1928, the position was that Ahmed Sahib had unsuccessfully at-tempted to get possession of the properties in certain criminal proceedings. Those proceedings, however, were not effective and did not give Ahmed Sahib the relief that he wanted and it was for the reason that he failed to get relief in the criminal proceedings and also in certain other proceedings to be mentioned later that he filed the suit in the District Munsif's Court on 7th December 1928. The simple mortgage was executed four months earlier by Bhandigi Sahib in favour of Katta Subbayya. The suit filed by Ahmed Sahib in the District Munsif's Court which was later on re-presented in the higher Court ended ultimately in the title of Ahmed Sahib being established as against Bhandigi Sahib.
3. On these facts the question is whether the plaintiff is protected by Section 41, T. P. Act. In this suit the plaintiff did not challenge the title of Ahmed Sahib. He was apparently content to proceed upon the judgment of the High Court that Ahmed Sahib was the real owner of the property. He (the plaintiff) mainly rested his case on the fact that Bhandigi Sahib was an ostensible owner in possession of the property with the consent express or implied of the real owner Ahmed Sahib and that he (the plaintiff) took the transfer (first the simple mortgage and later the usufructuary mortgage) after taking reasonable care to ascertain that the transferor had power to make the transfer and acted in good faith. The contesting defendants are 8 to 11, 13 and 14 who are sons and daughters of Ahmed Sahib. They contend that the plaintiff is a resident of the same street as Ahmed Sahib and Bhandigi Sahib that he knew all the litigations between Ahmed Sahib and Bhandigi Sahib and that therefore he had notice of the claim of Ahmed Sahib as against Bhandigi Sahib. It was also said that the plaintiff did not take any steps to ascertain that the transferor had the power to make the transfer and that he did not act in good faith. The trial Court held against the plaintiff and dismissed the suit. On appeal the District Judge held that the plaintiff advanced the money in order to discharge the debt due to Mr. Rameswara Rao, a leading advocate of Anantapur, and that therefore the provisions of Section 41 as to good faith and reasonable care to ascertain that the transferor had power to create the mortgage were fulfilled. The appellate Judge also held that on the facts of this case, there was no room to doubt that Bhandigi Sahib was in possession as the ostensible owner with the consent express or implied of the real owner. He stated thus:
As appears clearly from the record, Ahmed Sahib has been sending money to his family and getting properties purchased and not showing them in his own name with the purpose of avoiding mention of them in his landed property statement to Government, so that if large properties are shown in the property list, suspicion might not be raised that he had been able to purchase them by ill-gotten gains.
The word 'not' seems to be incorrect.
4. It is contended by Mr. Narasimhachar, the learned advocate for the appellants, that there is no finding in terms of Section 41 that Bhandigi Sahib was the ostensible owner with the consent express or implied of the real owner. But the passage just now extracted shows clearly that on the facts of this ease, it could not possibly be disputed that Bhandigi Sahib was in possession with the consent of Ahmed Sahib. In fact Ahmed Sahib asked Bhandigi Sahib to avoid purchasing the properties in the name of Ahmed Sahib. Ahmed Sahib was only a Sub-Inspector of Police and he could not have got all the money that he sent to Bhandigi Sahib as savings from his own salary. He must have got them by other means as pointed out in the appellate Judgment and he must have asked Bhandigi Sahib to purchase the lands in his own name and avoid purchasing them in the name of Ahmed Sahib. Thus, part 1 of Section 41 is fully satisfied.
5. As regards the next question it is said that there is no finding that Katta Subbayya made any enquiries or that he acted in good faith when he advanced the money on the simple mortgage or when he took the usufructuary mortgage. It was further urged that the plaintiff did not even go into the witness box and speak to the enquiries that he made. The plaintiff is an old man of over seventy on the date of the plaint and his son, P.W. 4, went into the witness box and spoke to the relevant facts. When a person in the position of Katta Subbayya was asked to advance money to Bhandigi Sahib in order to discharge a debt due to Mr. Rameswara Rao and when the properties stood in the name of Bhandigi Sahib, there was no need to make any further enquiry. The properties were originally in the name of one Hanumanthachar. Hanumanthachar sold the property direct in the name of Bhandigi Sahib. Bhandigi Sahib executed a mortgage in favour of Mr. Rameswara Rao. In these circumstances, if a person in the position of Katta Subbayya honestly believed that Bhandigi Sahib had the power to make the transfer, it cannot be said that there was anything unreasonable in his attitude or that he did not act in good faith. There is therefore no reason to differ from the District Judge and I hold that these conditions also are not satisfied.
6. The further point is whether the fact that Ahmed Sahib asserted his title in certain criminal proceedings as against Bhandigi Sahib excludes operation of Section 41. The learned advocate for the appellants urges that the condition that the ostensible owner should have been in possession of the immovable property with the consent express or implied of the real owner must be satisfied on the date of the transfer. It is urged that if the real owner had asserted his exclusive right in proceedings in a civil Court or in criminal proceedings, it could not thereafter be said that the ostensible owner was in possession with his consent express or implied. The argument is that even if he had given his consent to another person being in possession as an ostensible owner, he had withdrawn it on the date when he asserted that the ostensible owner should not be in possession any longer. Reliance was placed on a decision of the Allahabad Court in Fazal Hussain v. Mohamed Kazim : AIR1934All193 as also on an earlier decision of that Court in Shafir Ullahkban v. Sami Ullah Khan : AIR1929All943 . In the earlier decision the learned Judges held that the alienation itself must have been consented to by the real owner. That, however, is not a condition laid down under Section 41, T. P. Act. If the actual alienation which is attacked later on had been consented to by the real owner, then it would be a clear case of estoppel under Section 115, Evidence Act, as was pointed out by the learned Judges who decided the later case in Fazal Hussain v. Mohamed Kazim : AIR1934All193 . Coming to the later decision, it was a case where reasonable enquiries had not been made by the alienee from the ostensible owner. On that ground the alienee was non-suited as he had been in the lower Court. In dealing with the argument based upon the earlier decision, the learned Judges made an observation that the consent of the true owner to the possession of the ostensible owner must continue to the date of the transfer. Mr. Seshagiri Rao, the learned advocate for the respondents, urges that the observations in Fazal Hussain v. Mohamed Kazim : AIR1934All193 are really obiter, because ultimately the decision was rested on the ground that the alienee did not make any reasonable enquiry and that therefore the latter part of Section 41 was not satisfied. This appears to be so. Going back to the earlier decision in Shafir Ullahkban v. Sami Ullah Khan : AIR1929All943 it appears that the real owner commenced a suit to establish his title to the property and that the defendants in whom the apparent title stood, alienated the property to a third party. Thus, it is clear case of lis pendens. No doubt there are observations in Shafir Ullahkban v. Sami Ullah Khan : AIR1929All943 to the effect that the consent of the real owner must subsist on the date of the transfer and that the actual alienation must have been consented to by the real owner. Here again, I must accede to the contention of Mr. Seshagiri Rao that the observations in this case were really obiter. Mr. Narasimhachar for the appellants urges that the wording of Section 41 shows that the consent express or implied of the real owner must subsist when the transfer takes place.
7. My attention has been drawn to the decision of Mookerjee and Cuming JJ. of the Calcutta High Court in Baidhyanath Dutt v. Alef Jan Bibi : AIR1923Cal240 . There one Karimannessa who was the real owner of the property made a transfer in the names of her two grand-daughters Asia and Sufia. Sufia was a minor and Asia made an application under the Guardians and Wards Act and got herself appointed as the guardian. Later on she applied for permission to sell a portion of the property on behalf of Sufia. In those proceedings the grand-mother repudiated the gift made by her and urged that the sanction applied for should not be granted. But her opposition was not upheld and the permission sought was granted. Then an alienation was made and the question arose whether the alienation was protected by the terms of Section 41, T. P. Act. It was held that it was. On p. 199 the learned Judges say this, after referring to the various documents which showed that the apparent title was in the alienors:
The chain of title was thus complete. The factum of possession also was in accord with the title. Abdul Kader was in possession of the house. His wife, mother-in-law and grand-mother-in-law no doubt lived in the house, but they would be there as members of the family. The records in the Collectorate would show that the name of Karimannessa had been expunged and replaced by the names of Asia and Sufia; later on, these names had been replaced by that of Manatunbi who held the redemption certificate. If the intending mortgage could discover that Karimannessa had fruitlessly objected to the grant of permission by the District Judge to Asia to sell or mortgage the interest of her sister, the fact was undeniable that she had taken no further steps during a period of ten years. Again if the intending mortgagee could discover that Karimannessa had deposed in favour of the tenant in the suit by Manatunbi, the fact remained that her opposition was as abortive in 1909 as it had been in 1900.
Under those circumstances the title of the mortgagee was upheld. In that ease there was clear repudiation of the ostensible owner's right. If repudiation by the real owner precludes the applicability of Section 41, T. P. Act, the decision must have been otherwise. But the learned Judges do not seem to have regarded that repudiation as in any way affecting the applicability of Section 41 and they held that Section 41 applied to that case. In the case before us Ahmed Sahib did not succeed in the criminal proceedings. It is not necessary for us to enquire into the reason for his failure. If after he failed and before he filed the suit in the District Munsif's Court for establishing his title, Bhandigi Sahib effected the mortgage in favour of Mr. G. Rameswara Rao who evidently advanced monies in the belief that he (Bhandigi Sahib) had the right to effect the mortgage and if later on the plaintiff advances a sum of money in order to discharge Mr. Rameswara Rao's mortgage, I think the ease is governed really by the decision of Mookerjee and Cuming JJ. in the decision just referred to.
8. There is also a decision of a Single Judge in M.P.A.K. Firm v. Ma Mya Thein A.I.R. 1940 Rang. 184 in which also the same principle is laid down. As in the Calcutta case there were proceedings by the real owner against the ostensible owner in which the real owner asserted his title. One Daw Shwe Hme who was the original owner executed a registered deed of gift in favour of respondents 2, 3 and 4 in the appeal. There was a mortgage by respondents 2, 8 and 1 in whose favour there was the transfer by the original owner. It would appear that before the date of this mortgage by the ostensible owners a suit had been filed on 18th December 1936 in which respondent 1 had asserted his exclusive title to the properties and also prayed for the cancellation of the deed of gift whereby Daw Shwe Hme had transferred the lands in suit to respondents 2, 3 and 4. It was no doubt true that later on there was an amendment of the plaint in which this relief was omitted. The learned Judge points out that there was nothing to show that the alienees from the ostensible owners had knowledge of the litigation between the real owner and the ostensible owner, and that if they had knowledge of that litigation they would also have known that the attempt on the part of the real owner to assert his right to the property proved fruitless. In the present case the attempt on the part of the real owner did not succeed in the criminal proceedings. It appears that there were some arbitration proceedings and an award. But there again Ahmed Sahib does not appear to have succeeded, because notwithstanding the award, he was obliged to file a suit on 7th December 1928 asking the Court to establish his exclusive right to the properties in question. My attention has been also drawn to a decision of the Calcutta High Court in Chapalabala v. Sarat Kumari : AIR1941Cal318 where after the death of the real owner the property was transferred by the ostensible owner to a third party and it was held that the death of the real owner did not preclude the applicability of Section 41, T. P. Act. The argument was that if the title of the alienee from the ostensible owner is rested on the substance of the real owner's consent express or implied on the date of the transfer, the death of the real owner would put an end to the express or implied consent and that thereafter the ostensible owner would have no right to give a better title than what he had to an alienee from him. It was nevertheless held that the alienee could invoke the protection given under Section 41, T. P. Act. In the result the second appeal fails and it is dismissed with costs. No leave.