1 IN THE HIGH COURT OF BOMBAY AT GOA APPEAL FROM ORDER NO. 43 OF 2002. Mr. Manuel Joao Pereira, married businessman, having office at Shantilal Building, Ground floor, Near Municipality Building,Margao,Goa ... Appellant Versus Mr.Pascoal Sebastiao Cardoso, Major of age, resident of Igrejawaddo, Nessai, S. Jose de Areal, Salcete, Goa. .. Respondent Mr. M. B. D' Costa, Senior Advocate with Mr. J. A. Lobo, Advocate for the appellant. Mr. M. S. Usgaonkar, Senior Advocate with Mr. Sudesh Usgaonkar, Advocate for the respondent. CORAM : R. C. CHAVAN,J. Date of reserving the judgment : 20 th August, 2008. Date of pronouncing the judgment :29 th August,2008. ORAL JUDGMENT : 1. Appellant, a stranger to the family, who had purchased shares of most of the heirs of deceased Roselina and her husband, has filed this appeal to challenge order passed on 10.6.2002 by the learned Comarca Judge of Salcete and Quepem entertaining respondent's application for exercising right of pre-emption. 2 2. The facts, which have given rise to the appeal are as under: Roselina died in 1985. Inventory proceedings were initiated. By separate sale deeds appellant purchased undivided shares of all the parties, who appellant believed to have a share in the property. It is not seriously disputed that the respondent and his sister were however, left out as their relation was not noticed. 3. On 21.4.96, the appellant filed a suit against respondent for possession of a house, setting out details of all purchases made by him. Respondent filed a written statement therein on 11th August, 1997. 4. On 29.4.98, appellant applied for being added as a party to inventory proceeding and on 9.10.98 sought to be appointed as Cabeca de casal, since he had purchased the share of previous Cabeca de casal. On 18.11.98, respondent prayed for direction to appellant to produce all sale deeds. On 25.8.99, appellant produced all sale deeds. On 1.2.2000, respondent filed application for exercising his right of pre-emption. On 6.7.2000, appellant objected. After hearing parties the learned Judge passed the impugned order rejecting appellant's contention that respondent's application was barred by limitation. 3 5. I have heard the learned Senior Counsel Shri M. B. D'Costa for appellant and the learned Senior Counsel Shri Usgaonkar for the respondent. There can be no doubt that respondent got knowledge of all the sale deeds, by the time, he filed his written statement in Regular Civil Suit No.73/96, as also the fact that he exercised his right of pre-emption only on 1.2.2000, by the application, which was allowed by the impugned orders. The question is whether in these set of facts, the application was time barred. 6. According to the learned Counsel for the appellant, such a right was required to be exercised within 6 months from the date a co- owner has knowledge of sale to a stranger in terms of clause (1) of Article 1566 of Civil Code. The entire Article may be usefully reproduced for ready reference as under : - Article 1566 “The co-owners of an indivisible or undivided thing cannot sell to strangers their respective share, if the other co-owner wishes to have it for the same price 1. The co-owner, who is not given notice of the sale, may acquire the share sold to strangers provided he applies within the period of six months computed from the date he has knowledge of the sale, by depositing, before obtaining the delivery of possession, the price which according to the 4 terms of the agreement has been paid or is due. 2. Where there are more than one co-owner, the provisions of article 2309 para 4 and 5 shall be followed, but the shares are unequal and the largest shareholder wishes to pre-empt the respective share shall be allotted to him without licitation. 3. The right of pre-emption is not in any case defeated by the cancellation of the respective agreement, whether extra-judicially or by way of admission or compromise in court. 4. The period of limitation mentioned in para 1 of this article is applicable to all the other cases of pre-emption. ” 7. The learned Counsel for the respondent submitted that Article 1566 itself applies to pre-emption by co-owners and has no application to present case of co-heirs. The learned Counsel for the appellant countered, pointing out that clause (4) of Article 1566 clearly lays down that limitation of 6 months would apply to all other cases of pre-emption, which would obviously include claim of pre-emption by a co-heir like the respondent. For this purpose, he relied on articles by Portuguese jurists. His learned adversary, however, submitted that comments of jurists before coming into force of Procedure Code in 1939, were inapplicable. He submitted that right of pre-emption, need not be exercised till a meeting is convened as contemplated by Article 1514, which may be usefully quoted as under :- 5 Article 1514 (Notice in case of properties are belonging to the inheritance) “Where the properties are belonging to the inheritance, notice will be given to the administrator, except where they are licited or included in the share of some of them, on which case notice will be given to such interested party only. As soon as notice is given the administrator shall apply that meeting of the parties in interest be covered to decide within right of preemption is to be exercised by the inheritance. Where there are persons under disability who are not represented by the parents, the family council shall take part in the meeting. If the inheritance does not exercise the right of preemption, any heirs may exercise right of preemption within same time, irrespective of any other notice. Sole paragraph: When more than one heir wishes to exercise the right, the preference shall be given to the person who holds larger share, if the payment or deposit is not made within time, last part of proceeding article shall be applicable. Where the shares are equal, there shall be licitation amongst them in accordance with article 1512.” 8. According to the learned Counsel for appellant, reference to Article 1514 is itself misplaced. This article is to be found in Section XI of the Civil Code titled "Court notice for pre-emption." He submitted that the entire section relates to exercise of right of pre- 6 emption before sale is actually effected. Article 1511 with which the section begins, and which relates to right of pre-emption reads as under:- Article 1511 (Procedure for court notice for pre-emption) Where a person desires that another be notified to exercise, if he so wishes, the right of pre-emption, in the application the price and the conditions of the agreement to sell shall be set out and it shall be prayed that the person notified to state within 8 days whether he wishes to pre-empt. After this is done, the application and the certified copy shall be forwarded to the judicial section. Where the person receiving the notice wishes to pre-empt, he shall state so to the head clerk of the registry, who shall, if he is within the time limit, order the respective minutes to be drawn immediately after the certified copy. Where the head clerk of the registry refuses or has doubts, the interested party may apply to the judge to order the minutes to be drawn. After the minutes are drawn, the pre-emptor forfeits his right if within 20 days he does not execute the respective deed or he fails to apply that the opposite party be notified to receive the money deposited in the registry on the day and the hour fixed by the judge, on the condition that if he fails to do so the money shall be deposited. If thereafter the pre-emptor does not deposit or pay the price, he also forfeits the right, besides being liable for loss and damages. Sole Para. After the price is paid or deposited, the assets 7 shall be adjudicated to the pre-emptor. 9. Article 1512 and Article 1513 respectively deal with situations, where right of pre-emption vests in several persons simultaneously and successively. It may be seen that all these articles prescribe limit of 8 days for the person/persons to state if he wishes to pre-empt and if he does wish to complete the transaction/deposit the money within 20 days, failing which he forfeits his right. These articles are followed by Article 1514 quoted above, on which respondent relies. According to the learned Senior Counsel for the appellant, this article too refers to exercise of right of pre-emption prior to a sale. He submitted that Articles 1515 and 1516, deal with Court notices when right vests in a couple and co-owners respectively. 10. I have carefully considered rival contentions. Article 1514 cannot be isolated from the context in which it is placed. Series of articles from Article 1511 to 1514 cover situations where right of pre- emption vests respectively in an individual, in several persons simultaneously, in several persons successively and "in an inheritance". Vesting of right of pre-emption, in an inheritance, implies vesting of this right in an individual upon whose death the right vests in the inheritance, i.e. in all his heirs together. It does not refer to vesting right of pre-emption among his heirs in respect of properties left behind by 8 such person. An illustration may make this point clear. If A has a right of pre-emption in respect of properties owned jointly by him and B & C, he may exercise such a right under Article 1511, when say B or C seek to sell their share to D. When A, B & C all have a simultaneous right of pre-emption and one of them seeks to sell property to D, Article 1512 would be attracted. If exercise of right of pre-emption is to follow a particular order, Article 1513 would apply. And should A die and occasion to exercise right of pre-emption arises after his death, his 'inheritance', communality of interest of all heirs, as distinguished from interest of heirs inter-se,would exercise rights according to Article 1514. 11. This is clear from the Article itself. It enjoins the head of the family to convene a meeting to decide whether "inheritance" wishes to exercise such right. When inheritance does not so wish, heirs individually may exercise such rights, presumably simultaneously and this would be governed by Article 1512. This right is, thus, to be exercised in respect of property in respect of which propositious had a right of pre-emption and does not refer to right of pre-emption of his heirs. 12. Apart from this, it is not that such right, can be exercised any time. Though no time limits have been prescribed in Article 1514, limits in Articles 1511 to 1513 would mutatis mutandis apply. If the 9 person in whom the right to pre-empt vests, dies with a sole heir, who inherits such right, his case would be governed by Article 1511, if there be more heirs, who take simultaneously when "inheritance" declines to pre-empt, Article 1512 would apply and so on. All this has to be done within the same time limit i.e. of 20 days. 13. If this is so in respect of a proposed sale of which notice is given, when sale is already complete, albeit in ignorance of existence of a person, who had the right of pre-emption, such person can not have a better right than one, who had notice prior to sale i.e. 20 days. 14. In any case, since Article 1514 has, in my view, no application to a completed sale and reference to Article 1376, would be imperative. It reads as under: Article 1376 (Exercise of the right of pre-emption) Where any of the heirs has made transfer of his share to a stranger, without giving preference to th co- heirs, the latter may exercise the right of pre-emption in the inventory proceedings, when the transferee makes an application to be brought on record in that capacity. In the event there is more than one heir to exercise the right of pre-emption, the provision of the sole paragraph of Article 1514 shall be observed. 10 15. Reference to sole paragraph of Article 1514, would not amount to reference to the Article itself. Had the legislature felt that right of pre-emption in respect of transfers completed by a co-heir were to be governed by Article 1514, it would have sold so. It refers to only the sole paragraph of Article 1514 and also for a specific situation, namely when more than one heir can exercise right of pre-emption. The sole paragraph then naturally takes the case to Article 1512, where there are more than one person in whom the right simultaneously vests. Such right has to be exercised by such heir when the transferee makes an application for being brought on record. Transferee (appellant) in this case made such application on 9.10.98, and prayed for being appointed as head of the family. The respondent had the right to apply for pre- emption. This substantive right, in the absence of any provision to the contrary, was required to be exercised within 6 months from the date of knowledge in terms of clause (4) of Article 1566. 16. It was not open to respondent to contend that he got knowledge only upon production of sale deeds on 25.8.99, and claim that his application dated 1.2.2000, was within six months of this knowledge. As rightly pointed out by the learned Counsel for appellant, respondent had knowledge of all these sale deeds, details whereof were pleaded in the suit filed on 21.4.96, to which respondent filed a written 11 statement on 11.8.97. Thus, the right had to be exercised latest within 6 months of 11.8.97, and was therefore, hopelessly time barred. 17. The object of fixing time limits for exercising right of pre- emption is obvious. Prices of properties do not remain static. A purchaser or a prospective purchaser cannot be made to forgo fruits of his bargain years after he parts with consideration and receive comparatively a small price, which may have initially paid. Since the respondent, who had knowledge of sales as early as on 11.8.1997, did not exercise his right within 6 months as mandated in clause (4) of Article 1566, he could not have been permitted to exercise such right by the impugned order. 18. Appeal is, therefore, allowed and the impugned order dated 10.6.2002 is quashed and set aside. Costs as in the cause. R. C. CHAVAN, J. SMA 12