Asutosh Chaudhuri, J.
1. The plaintiff firm claims to be the owner of 25 Baranagore Jute shares, being shares Nos. 51064 to 51088. These shares are now registered in the books of the Company in the name of Shohanlal, who is one of the partners of the plaintiff firm. The plaintiffs bought these shares from the defendant firm of Lalchand Prem sookh on the 7th May 1917 and paid for them at Rs. 87-8-0 per share. The defendant firm at the time of the sale made over to the plaintiff firm the certificate for the said shares and also a blank transfer deed signed by one Jugal Chandra Roy, whose name appeared upto the 11th May 1917 in the books of the said Company as the registered owner of the said shares. After the purchase by them the plaintiff firm got the transfer in the name of Shohanlal on the 12th May 1917. These shares were purchased by the defendant Satish Chandra Ghosh in February 19l7. In or about April 1917 a person calling himself Upendra Nath Mukerjee came and proposed to him that he would be able to sell these shares at a better rate than was available in the market. Satish Chandra Ghosh thereupon made over these shares to his clerk Punchanan Mukerjee with directions to him not to part with the shares until cash was paid for them and he sent him with Upendra Nath Mukerjee. This happened on the 17th April 1917. It is stated by Punchanan Mukerjee that when they went to the share market, Upendra Nath Mukerjee persuaded him to make over the shares to him and asked him to wait as he was going to get payment for them; but eventually he did not turn up. Punchanan Mukerjee waited for sometime and then went to his master and reported that he could not trace the man, and from that time Satish Chandra Ghosh could not trace these shares until a Police enquiry was held. These shares appear to have been purchased by the defendant firm of Lal Chand Premsookh & Co. from Upendra Nath Mukerjee. It is said by them that a sawda was made on the 5th May 1917, but that the shares were actually delivered to them on the 7th May; that payment was made to Upendra Nath Mukerjee by a crossed cheque; but that a few days later the man came back with the crossed cheque and said that he could not cash the crossed cheque and thereupon it is said that the defendant firm of Lalchand Premsookh & Co. paid him cash and took back the cheque. This payment is said to have been made on the 16th May. The rate at which they purchased was Rs. 85 and they say that they paid brokerage also. The plaintiffs bought from Lalchand Premsookh as above mentioned. I am satisfied upon the evidence that Satish Chandra Ghosh owned these shares and that Upendra Nath Mukerjee obtained them By a trick and disappeared with them. I am also satisfied that the plaintiffs purchased from the defendant firm of Lalchand Premsookh bona fide, that they paid fall value for them and that they subsequently got their name registered as above mentioned. I am not quite satisfied with the account given by Lalchand of the transaction with Upendra. His account of the matter before me differs from the account given by him in the Police Court in important particulars. His clerk Lal Behari was examined, but he had no personal knowledge of the sawda. On the first day of the examination of Lalchand, he said nothing about one Jowala Prosad having acted as broker in the transaction, but he made such a statement on the second day of the hearing. Jowala Prosad has been examined and he says that he met Upendra Nath Mukerjee in the share market and had a conversation with him, that Lalchand came up, and then the matter was discussed between Lalchand and Upendra Nath Mukerjee and the purchase was effected by Lalohand. He says that although he was not a broker' in the transaction, he was present at the time when the matter was discussed and, therefore, he claimed brokerage, and Lalchand out of kindness' gave him some brokerage which he said was Rs. 12-8-0, but from the books of Lalchand Rs. 25 purports to have been paid to Jowala Prosad, which is more than the ordinary brokerage. Lalchand, although old and illiterate, is a shrewd man of business. It is absolutely impossible to rely upon his statements and I am not at all satisfied with the account of the transaction given by him. It is not supported with regard to the details by anybody; but having regard to the large dealings of this firm I will not say that the transaction was mala fide. Even accepting the figure mentioned by Lalchand as having been paid, the rate was somewhat lower than the market rate No attempt has been made to prove that Upendra was a broker or that he was known as such. Lalchand's statement to that effect I am not prepared to accept. In his books the name of Dutt and Mukerjee appears, but the cheque was drawn in the name of Upendra Nath Mukerjee. It has not been shown that there was any such firm of brokers as Dutt and Mukerjee. I have carefully 'considered the matter and I am not at all satisfied with the account given by Lalchand or with the nature of the transaction between him and Upendra.
2. Under these circumstances what is the result? These shares were obtained by fraud from Satish Chandra Ghosh by Upendra Nath Mukerjee. He was tried in the Calcutta Police Court and has been convicted. The conviction is on alternative sections, criminal breach of trust, or cheating, but which section in fact it was, is immaterial. I hold that he obtained possession of these documents upon a fraudulent representation either to Satish Chandra Ghosh or his clerk and that he fraudulently dealt with these shares. If the transaction is covered by Section 108 of the Contract Act, I hold that the person who purchased these shares from him did not acquire good title. The expression goods' in that section includes all moveable property, see Section 76 of the Contract Act. It was said that inasmuch as Upendra Nath Mukerjee was in possession, he could give good title under Section 108, exception (1), but that exception requires possession with the consent of the owner. Here the consent was obtained by deceit and I, therefore, hold that the exception is not applicable. In support of this I refer to Cole v. North Western Bank (1878) 10 C.P. 354 at p. 373 : 44 L.J.C.P. 233 : 32 L.T. 733 Cahn v. Pockett's Bristol Channel Steam Packet Co. (1899) 1 Q.B.D. 613 at p. 659 : 68 L.J.Q.B 515 : 80 L.T. 269 : 47 W.R. 422 : 8 Asp. M.C. 5l6 : 4 Com. Cas. 168 : 15 T.L.R. 247, and Oppenheimer v. Frazer (1907) 2 K.B. 50 : 76 L.J.K.B. 806 : 97 L.T 3 : 12 Com. Cas. 289 : 23 T.L.R. 410 : 51 S.J. 373.
3. It has been argued that by mercantile usage these documents, share certificates with blank transfer deeds endorsed by the last registered owner, are negotiable instruments. These are certificates of shares in a Company whose Articles of Association require that the transfer shall be by a separate instrument executed both by the transferor and transferee and that the name of the transferee shall be entered in the register of shareholders. On the face of these documents they are not transferable, but it is claimed that inasmuch as in the Calcutta market sales of shares are effected when they are accompanied by such blank transfer deeds and pass from hand to hand, they are, therefore, to be considered as negotiable instruments; but certain requirements have to be fulfilled before any instrument of this character can be considered negotiable. It must be in a form which renders it capable of being sued on by the holder of it pro tempore in his own name and it must be by the custom of trade transferable like cash by delivery. Failure of these requirements prevents its being treated as a negotiable instrument. See Halsbury's Laws of England, Volume 2, page 565, Article 967. It practically sums up what has been held in England. The authorities are there noted and it is, therefore, unnecessary to repeat them. In Chalmer's Bills of Exchange, 7th Edition, page 359, share certificates with blank transfers are stated not to be negotiable instruments on the authority of, amongst other cases, Swan v. North British Australasian Co. (1863)2 H. & C. 175 : 32 L.J. Ex. 273 at p. 278 : 10 Jur. (N.S.) 102 : 11 W.R. 862 : 159 E.R. 73 : 126 R.R. 617. The position of similar documents has been discussed in a great many oases and it is perhaps useful to refer to some of them. In Colonial Bank v. Hepworth (1887) 36 Ch. D. 36 : 56 L.J.Ch. 1089 : 57 L.T. 148 : 36 W.R. 259, the question is elaborately discussed. The following passage occurs at page 51: 'The ultimate shape in which the plaintiff's Counsel put their arguments was this: They did not contend, and indeed they could not have successfully contended, that the certificates with blank transfers were negotiable instruments in the strict sense of the term; but they urged that these documents were what they term negotiable by estoppel. They contended that the effect of the mere delivery of the document to a bona fide purchaser operated as a legal as well as equitable transfer of the shares whatever might be the defect in the title of the vendor, and that every prior holder was estopped from denying the title of such bona fide purchaser. They founded this argument on the first proposition relied on by Lord Cairns in Goodwin v. Robarts (1876) 1 A.C. 476 : 45 L.J. Ex 748 : 35 L.T. 179 : 24 W.R. 987.'Discussing the question of estoppel the learned Judge says on page 53 'Estoppels cannot be manufactured arbitrarily; no estoppel can be raised on a document inconsistent with the terms of the document itself. What then is the estoppel here? Having regard to the practice proved and the condition in which these documents are when they pass from hand to hand, the right principle to adopt with reference to them is to hold that where the transfers are duly signed by the registered holders of the shares, each prior holder confers upon the bona fide holder for value of the certificates for the time being an authority to fill in the name of the transferee and is estopped from denying such authority, and to this extent, and in this manner, but not further, is estopped from denying the title of such holder for the time being. By the delivery an inchoate legal title passes, but a title by unregistered transfer is not equivalent to what has been termed 'Legal Estate' in the shares, or to the complete dominion over them.'
4. In London and County Banking Co. v. London and River Plate Bank (1888) 20 Q.B.D 232 the question arose with regard to a certain share certificate which was in this form '... is entitled to 20 shares in the capital stock of the Company transferable only in person or by attorney on the books of the said Company.' On the back of that document was the power-of-attorney. This was executed in blank for the name of the transferee and of the attorney. It was held, having regard to those circumstances, that it was a negotiable instrument. This question was again considered in the Colonial Bank v. Cady (1890) 15 A.C. 267 : 60 L.J.Ch. 131 : 63 L.T. 27 : 39 W.R. 17. Those shares were transferable on the books of the Company only on the surrender and cancellation of the certificate by endorsement thereon. Lord Watson expressed an opinion that in a case like that when the endorsed transfer had been duly executed' by the registered owner of the shares, the name of the transferee being left blank, delivery of the certificates in that condition by him or by his authority transmitted his title to the shares both legal and equitable. The person to whom it was delivered could effectually transfer his interest by handing, his certificate to another, and the document could thus pass from hand to hand until it came into the possession of the holder who thought fit to insert his name as transferee and to present the document to the Company for the purpose of having his name entered in the register of shareholders and obtaining a new certificate in his favour; Lord Watson was of opinion that the negotiability of such an instrument was not based upon custom but upon estoppel and that the estoppel did not arise out of the mere form of the instrument but out of the fact (if it were a fact) that the owner had represented to the holder as having full authority to deal with the instrument. Lord Herschell added that the mere delivery of the certificate with the endorsed blank transfer and power-of-attorney, signed irrespective of any act or intent of the owner of the share, was not of itself sufficient to pass the title to them. Applying the tests suggested in the English oases and the principles therein enunciated, I hold that the shares in question cannot be treated as negotiable instruments. There is nothing more in the shape of evidence of usage in this case before me than that share certificates with transfer deeds endorsed in blank pass from hand to hand. For legal title it is conceded they must be registered in the books of the Company. I know of no case where it has been held that a transfer deed executed by a transferor in blank as regards the transferee and accompanied by the transferor's share certificates are negotiable instruments transferable by delivery and confer a good title on a bona fide holder without notice of any defect in the title of the person from whom he receives them, nor has any such case been brought to my notice. The idea of dealings in shares in this country has come from England and practically the same practice prevails here as in the English Market, and I think that unless there are distinguishing features we ought to follow the law on the subject as is to be found in English oases. I hold that the defendant firm did not acquire good title to these shares and that the plaintiffs by their purchase did not acquire title to them,
5. Then the question arises as to what the plaintiffs are entitled to, their purchase having been bona fide and for value from the defendant firm. Under Section 109 of the Contract Act the plaintiffs are entitled to recover the loss caused to them in consequence of these shares being declared not to belong to them. They claimed the market value of these shares on the date the Police took possession of them, and all interim dividends and privileges which have been declared and granted by the Company. On this basis they claim at the rate of Rs. 230 per share, but I do not think that they can claim anything more than the value that they paid for these shares with interest from the date of payment at 6 per cent. The result is that the shares are declared as not belonging to them, but as belonginar to Satish Chandra Ghosh; that they are entitled to the price that they paid for such shares from the defendant firm with interest as above mentioned; that they are to pay the costs of Satish Chandra Ghosh of this action on scale No. 2 including, reserved costs, if any, and to add such costs to their claim and to recover same as against the defendant firm. The plaintiffs will get their costs from the second defendant on scale. No. 2.