1 S.A.NO.334 /2007. IN THE HIGH COURT OF JUDICATURE AT BOMBAY, BENCH AT AURANGABAD. SECOND APPEAL NO.334 OF 2007. M/s.Hanuman Vallabhdas & Sons A Partnership Firm., through it's Partner Sharad S/o Nandlal Agrawal, Age: 63 years, Occ: Business, Resident of 325, Bhatwal Hospital Near Agrawal Nagar, Dhule, District: Dhule. ...Appellant. (Ori.Deft.No.7) VERSUS 1. Pitambar S/o Bhatu Chaudhary, Deceased through his legal heirs: 1-A) Smt.Sarubai W/o Pitambar Chaudhary, Age: 74 years, Occupation: Household, 1-B) Gulab S/o Pitambar Chaudhary, Age: 40 years, Occupation: Service, 40 years, Occupation: Service, 1-C) Dilip S/o Pitambar Chaudhary, Age: 38 years, Occupation: Business. 1-D) Ravindra S/o Pitambar Chaudhary, Age: 34 years, Occupation: Rickshaw Driver, Respondent Nos.(1-A) to (1-D) Residents of CTS No.2515 Lane No.14, Madhavpura, Dhule, District Dhule; 2 S.A.NO.334 /2007. 1-E) Sau.Vasanti Nimba Chaudhary, Age: 48 years, Occp: Household work, R/o: Mohadi Upnagar, Dhule. 1-F) Sau Sulochana Subhash Chaudhary, Age: 44 years, Occupation: Household, resident of Bapu Nagar, Mansari Musjid Laxmipura Chawl, Ahmedabad Gujarat State; 2) Smt.Chintabai Shamlal Chaudhary, Sin 40 years, Occupation: Service, ce deceased through L.Rs. 2-A) Shri Nimba Shamlal Chaudhari Age: 43 years, Occ: R/o at Post Warkhede, Tq. & Dist.Dhule. 2-B) Nirmalabai Pandharinath Chaudhari Age: 48 years, Occ: Household, R/o.C/o Pandharinath Sukhdev Chaudhari Near Shivaji Putla, At Post Rasalpur, Tq.Raver, Dist.Jalgaon. 2-C) Kamlabai Ratilal Chaudhari, Age: 40 years, Occ: Household, R/o.C/o.Ratilal Hiralal Chaudhari Near Sakri Naka, Nandurbar. 2-D) Surekhabai Dashrath Chaudhari Age: 37 years, Occ: Household, R/o.C/o.Dashrath Pandurang Chaudhari Gandhipura, At Post Erandol, District Jalgaon. 2-E) Smt.Sarubai W/o Pitambar Chaudhary, Age: 74 years, Occ: Household. 2-F) Gulab Pitambar Chaudhary, Age: 40 years, Occ: Service, 3 S.A.NO.334 /2007. 2-G) Dilip Pitambar Chaudhary, Age: 38 years, Occ: Rikshaw Driver. Nos.1-E to 1-H residing at CTS No.2515, Lane No.14, Madhavpura, Dhule. 2-I) Sau.Vasanti Nimba Chaudhary, Age: 48 years, Occu: Household Work, R/o.at Mohadi Upnagar, Dhule, Taluka and District Dhule. 2-J) Sau.Sulochana Subhash Chaudhary Age: 44 years, Occ.Household, R/o Bapu Nagar, Mansani Musjid, Laxmipura Chal, Ahmedabad (Gujrath State). (Amended as per Court's Order dated 23.08.2007 passed in Civil Application No.6858 of 2007 & Civil Application No.7111/2007.) 3. Kashinath s/o Yashwant Jambhale deceased, through his legal heirs: 3-A) Dwarkabai Kashinath Jambhale Age: Major, Occupation: Household; 3-B) Arvind S/o Kashinath Jambhale, Age: Major, Occupation: Business; 3-C) Bharat S/o Kashinath Jambhale, Age: Major, Occupation: Business. 3-D) Janardhan S/o Kashinath Jambhale, Age: Major, Occupation: Business; 3-E) Sau Pramilabai Shankarrao Magilkar, Age: Major, Occupation: Household; Respondent Nos.(3-A) to (3-E) Residents of Agrawala Nagar, Malegaon Road, Dhule; 4 S.A.NO.334 /2007. 3-F) Sau Sindhubai Bharat Yerdawkar Age: Major, Occupation:Household, resident of Yerdav, Taluka Mangalveda District Solapur; 4) Ashok S/o Mishrilal Khivsara Age: 48 years, Occupation: Business, resident of C/o.Suresh Mishrilal Khivsara Behind Natraj Cinema Mahalaxmi Colony, Dhule; 5) Suresh S/o Ramlal Lunkad Age: 53 years, Occupation: Business, resident of Borad, Taluka Shahada, District- Nandurbar; 6) Kishor S/o Ramrao Patil Age: 53 years, Occupation: Business, resident of 36-K, Phule Colony, Dhule, District Dhule; 7) Dharmaraj S/o Madhavrao Pawar, Age: 58 years, Occupation: Teacher, resident of Tamashwadi, Taluka Paroda, District Jalgaon; 8) Suresh S/o Mishrilal Jain, Age: 53 years, Occ: Business, Resident of Mahalaxmi Colony, Behind Natraj Cinema, Dhule, District: Dhule. ...Respondents. (Res.No.1-A to 1-F and 2-Original Pltffs. Res.No.3 to 8-Ori- Defts. No. 1 to 6) 5 S.A.NO.334 /2007. ... Mr.P.M.Shah, Senior Advocate with Mr.Subodh Shah, Advocate for the appellant. Mr.P.R.Katneshwarkar, Advocate h/f for Mr.Mahesh H.Patil, Advocate for respondent Nos.1A to 1F and for respondent Nos. 2-E to 2-J. Mr.G.R.Syed, Advocate for respondent Nos.2-A to 2-D. ... CORAM: A.V.NIRGUDE,J. Date : 29th August, 2009. ORAL JUDGMENT: 1. This appeal is filed against the judgment and decree of the learned District Judge, Dhule in Civil Appeal No.171 of 2001, which in turn had confirmed the decree passed by the Civil Judge (Senior Division), Dhule in Special Civil Suit No.27 of 1999, dated 16th April, 2007. The original respondents No.1 and 2 filed the suit for declaration in respect of a piece of land admeasuring 3 Acres, situated at Dhule. 2. The case of the respondent Nos.1 and 2 / the original plaintiffs No.1 & 2 ( hereinafter referred as. "the plaintiffs"), is that, the suit land originally belonged to one Bhattu Chaudhary, the late father of the plaintiffs. Bhattu had a mistress by name Baijabai. Bhattu had executed a 6 S.A.NO.334 /2007. registered document in favour of Baijabai and had given the said land in her possession. After the death of Bhattu, plaintiffs filed suit bearing No.23/1976 against Baijabai for recovery of the possession of the suit land. Baijabai contended that the suit land was gifted to her and it was an absolute transfer making her owner. But, ultimately at the first appellate stage, the Court rejected her case and held that Baijabai was entitled to retain possession of the land, enjoy it's fruit till her death. It also contemplated that after her death, the land should go to its owners namely the plaintiffs. 3. During the pendency of the appeal arising from Suit No.23/1976, Baijabai executed a sale deed in favour of Kashinath on 17.03.1981. The plaintiffs stated that they were not aware of this transaction. During the life time of Baijabai, Kashinath further sold the suit land to the defendant Nos. 2 to 8 on 19.10.1987 and they in turn sold it to the defendant No.7 on 25.08.1989. All these transactions were registered sale deeds. The parties to the transactions promptly got their names mutated in the revenue record. However, it is the case of the plaintiffs that they were not aware of these changes taking place in respect of the suit land, though they claimed that they are the absolute owners of the same after their father's death. 7 S.A.NO.334 /2007. 4. Baijabai died on 14.10.1991. The plaintiffs learnt about the same in June, 1994 and they obtained the 7/12 extracts of the suit land. From the contents of the same, they learnt that the suit land was in the mean time got transferred successively to various parties. Thereafter, in 1994, the plaintiffs filed this suit. 5. The defendant No.7 alone contested the suit mainly on two grounds that the suit was barred by limitation and that they were bona fide purchasers for value without notice of the plaintiffs' title from the ostensible owner (defence based on Section 41 of the Transfer of Property, Act, 1882). The trial Court, on both the counts rejected their defence. Even, the appeal filed by them was dismissed. 6. At admission stage of this appeal the appellant tried to raise two substantial questions of Law: "(i) Whether the suit was filed within limitation ? (ii) Whether they were protected under Section 41 of the Transfer of Property Act ?" 8 S.A.NO.334 /2007. 7. At that stage, this Court specifically held that the question of limitation is not a substantial question of law involved in this appeal. The learned judge recorded reasons for coming to such conclusion in the order dated 30th October, 2007 and formulated following substantial question of law: " Whether in the facts and circumstances of the present case, the appellant being third purchaser is entitled to protection under Section 41 of the Transfer of Property Act as a bona fide purchaser for valuable consideration and can claim equities in his favour ? If yes, what alternative relief in favour of the plaintiffs ?" 8. In order to appreciate the argument of the learned counsel appearing for the appellant, one must take into account the relevant provisions(viz. S.41 and S.52) of the Transfer of Property Act, 1882. Section 41. Transfer by ostensible owner.-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: Provided that the transferee, after taking reasonable care to ascertain that the transferor had power to make the transfer, has acted in good faith." 9 S.A.NO.334 /2007. 52. Transfer of property pending suit relating thereto.- During the [pendency] in any Court having authority [within the limits of India excluding the State of Jammu and Kashmir] or established beyond such limits] by [the Central Government ], of [any] suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein, except under the authority of the Court and on such terms as it may impose. [Explanation.--For the purposes of this section, the pendency of a suit or proceeding shall be deemed to commence from the date of the presentation of the plaint or the institution of the proceeding in a Court of competent jurisdiction, and to continue until the suit or proceeding has been disposed of by a final decree or order, and complete satisfaction or discharge of such decree or order has been obtained, or has become unobtainable by reason of the expiration of any period of limitation prescribed for the execution thereof by any law for the time being in force.] Maharashtra.-Section 52 of the Act shall be renumbered as sub-section (1) of that section and.- (i) in sub-section (1) as so renumbered after the word "question" the words and figures "if a notice of the pendency of such suit or proceeding is registered under Sec.18 of the Indian Registration Act, 1908" and after the word "property" where it occurs for the second time, the words "after the notice is so registered" shall be inserted, and (ii) after the said sub-section (1) as so renumbered the following sub-section shall be inserted, namely,- "(2) Every notice of pendency of a suit or proceeding referred to in sub-section (1) shall contain the following 10 S.A.NO.334 /2007. particulars, namely- (a) the name and address of the owner of immovable property or other person whose right to the immovable property is in question; (b) the description of the immovable property, the right to which is in question; (c) the Court in which the suit for proceedings is pending; (d) the nature and title of the suit or proceedings; and (e) the date on which the suit or proceeding was instituted." 9. In order to seek protection of the provisions of Section 41 of the Transfer of Property Act, the transferee must, first prove that the transferor though was an ostensible owner and was not the real one had obtained consent express or implied of the real owner to hold out to the word that he was the owner of the property. In this case, the defendant No.7 had purchased the suit land from the defendant Nos.4 to 8. As said above, they had, in turn purchased the suit land from the defendant Nos.1-Kashinath. The defendant No.1 had purchased the suit land from Baijabai. 10. Mr.Shah, the learned Senior Counsel appearing for the appellants admitted that the defendant No.1 could not have had valid title for he had purchased the suit land during the pendency of the previous litigation from the Baijabai, who he knew, had no valid title to the land. He further pointed out and rightly so that though this 11 S.A.NO.334 /2007. transaction took place in 1981 and through a registered document, the plaintiffs, who had constructive notice of the same, took no action against either Baijabai or against the defendant No.1. He further pointed out that the Revenue record was suitably mutated after the transaction of 1981 between Baijabai and the defendant No.1. Even then, the plaintiffs took no action. The Revenue record, thenceforth showed that the defendant No.1 was owner of the suit land and this position, he pointed out, continued till 1986, when the defendant No.1 sold the land to the defendant Nos.4 to 8. He pointed out that even this transfer was a registered sale deed, a constructive notice of which is attributable to the plaintiffs. He pointed out that even this transaction was reported to the Revenue Authorities, who made suitable mutation in their record and showed the defendants No.4 to 8 as owner of the suit land. Thereafter, in 1989, he said, lastly his client purchased the suit land through the registered sale deed and got his name mutated in the Revenue Record. Despite of these transactions, which were not secret ones and of which constructive notice is attributable to the plaintiffs, they did not take any retaliatory action against the parties involved. 11. Mr.Shah, thus pointed out that though the plaintiffs were the real owners of the suit land 12 S.A.NO.334 /2007. through their in action, they allowed first the defendant No.1 and then the defendant Nos. 4 to 8 to hold out as owner of the suit land. He said this inaction on their part amounted to "implied consent" contemplated by Section 41 of the said Act. He thus suggested that the first part of Section 41 has been proved by the defendant No.7. Mr.Shah, rightly placed reliance on the following passage of an old judgment in the case of "Ramcoomar Koondoo V/s Macqueen 11 BLR 46": "It is a principle of natural equity, which must be universally applicable, that where one man allows another to hold himself out as the owner of an estate, and a third person purchases it for value from the apparent, owner in the belief that he is the real owner, the man who so allows the other to hold himself out shall not be permitted to recover upon his secret title unless he can overthrow that of the purchaser by showing, either that he had direct notice, or something which amounts to constructive notice, of the real title, or that there existed circumstances which ought to have put him upon an inquiry that, if prosecuted, would have led to a discovery of it." 12. To this, Mr. Katneshwarkar, the learned Advocate appearing for the respondents, asserted that the transaction between Baijabai and Kashinath was squarely hit by Section 52 of the Transfer of Property Act, 1882 and since the said transaction was prohibited by Section 52, it is non est. I am not inclined to accept this 13 S.A.NO.334 /2007. argument because though Section 52 had specifically prohibited the transfer made by the Baijabai in favour of defendant No.1, it was not non est or void-ab-initio. It merely depended on the out come of the previous litigation. Had Baijabai succeeded in the litigation and could have proved her title, the defendant No.1 would have claimed perfect title. 13. In this regard, following paragraph of the judgment of the Supreme Court in the case of Hardev Singh V/s Gurmail Singh (dead) by Lrs. (2007) 2 Supreme Court Cases 404 is a useful reference. "18. The learned trial Judge and the first appellate court had decreed the suit of Udham Kaur only on the basis that she acquired the suit property during the pendency of the earlier litigation. Section 52 of the Act merely prohibits a transfer. It does not state that the same would result in an illegality. Only the purchaser during the pendency of a suit would be bound by the result of the litigation. The transaction, therefore, was not rendered void and/or of no effect." 14. It neither can be said that the defendant No.1 purchased the suit property fraudulently because he purchased it through a registered sale deed and with the knowledge that he was bound by the result of the pending litigation. In a way, he took only a risk. 14 S.A.NO.334 /2007. 15. The defendant Nos.1 as well as his alienees during the intervening period openly asserted through the registered sale deeds that they were owners and purchasers etc. of the suit property and thereby exhibiting the implied consent of the real owners the plaintiffs. I have, therefore, no hesitation to hold that the first condition of Section 41 of the said Act, has been fulfilled by the defendant No.7 that they had purchased the suit property from an ostensible owner and that such ostensible owner had implied consent of the real owner and the ostensible owner had transferred the suit land in their favour for consideration. 16. The second part of Section 41 of the said Act still requires the transferee of an ostensible owner such as the defendant No.7 here that they had taken reasonable care to ascertain that the transferor had power to make transfer and thirdly that they had acted in good faith. The question is whether the defendant No.7 took reasonable care for ascertaining that their transferor or the the transferor of their transferor had power to make the transfer? In other words, whether they took reasonable care to ascertain the title of their transferor. 17. Mr.Shah, for the appellant has again placed 15 S.A.NO.334 /2007. reliance on the facts that the transactions between Baijabai till defendant Nos.4 to 8 were witnessed through registered deeds, proper mutation entries were taken pursuant to the transfers and so one would say that they had taken reasonable care to examine the title of their transferor. In support of this, he also placed reliance on the deposition of the partner of the defendant No.7, who stated that before entering into the transaction, he perused the 7/12 extracts of the suit land as well as all the mutation entries. The copies of these documents are on record. They are at Exhs.128, 156, 158, 159, 170, 171, 173 to 185. 18. As against this, Mr.Katneshwarkar, brought to my notice Exh.134, the extract of mutation register, dated 25th September, 1952. This extract is in respect of mutation as to how Baijabai got 'proprietary concern' to the suit land. If translated, it reads as under: " Sr.No. Date 1955 14/04/1949 - Bhattu Sakharam Teli on 3rd of March, 1949 had executed arrangement deed (Vyavastha Patra) in favour of Baijabai d/o Bhawadu Koli. The land thus was divided into two portions, 3 Acre in favour of Baijabai d/o Bhaudu, 13 Acres 32 Gunthas in favour of Bhattu Sakharam Teli." 16 S.A.NO.334 /2007. 19. The mutation was finalised on 29th August, 1952. It is through this mutation entry, the revenue record stood amended and Baijabai was shown as owner of the suit land. The question, the purchasers including the defendant No.7, should have asked to themselves as to whether an "arrangement deed" could amount to a deed of transfer. The words, "arrangement deed" would certainly excite a purchaser to start further inquiry about this arrangement deed. This word, in my view, amounts to "existence of a circumstance which ought to have put the defendant No.7 upon an inquiry" and such inquiry, if the defendant No.7 had with reasonable care, had prosecuted further, there was possibility of they coming across the decree, the plaintiffs ultimately obtained in their previous litigation. 20. Had the defendant No.7 taken the inquiry of title further taking clue from the word, "arrangement deed", they would have obtained a copy of the same. Having perused the same, they would have certainly asked the transferors to get solemn affirmation from Baijabai, -who was then alive- that she had valid title and that she was entitled to transfer the suit land to the defendant No.1. They could have also insisted on the defendant No.1's similar statement etc. Obviously, they would not have given such 17 S.A.NO.334 /2007. statement and in the process there was strong possibility that the defendant No.7 would have come across, the decree passed in favour of the plaintiffs, in the earlier litigation. 21. In my view, such inquiry into the title would amount to the "reasonable care" contemplated by S.41. Anything less than this would be a casual inquiry and not in consonance with the requirement of Section 41 of the said Act. 22. I am aware that this aspect of the matter, has not been discussed by the First Appellate Court. I am also aware that this discussion was expected from that Court. None the the less, there is nothing that prevents me from going into such details. 23. On the contrary, the learned Judge of the trial Court, to some extent discussed this aspect of the matter and held that the inquiry of the defendant No.7 into the transferor's title was not sufficient and so it held that they were not bona fide purchasers. None the less, none of the Courts below paid much attention to the contents of the document Exh.134, the mutation entry of 1949, though it was on their record. 18 S.A.NO.334 /2007. 24. Mr.Shah's argument that at the relevant time, when the defendant No.7 examined the title, the plaintiffs names were not mentioned in any of the public record and he also suggested that even Baijabai was not in picture. I think, this argument is not acceptable, because on careful perusal of the revenue record itself, as said above, not only Baijabai's name comes into picture, but her dubious source of title was also clearly indicated. 25. I record my finding that the defendant No.7, the present appellant did not take reasonable care in examining the title of the transferor and to find out whether they had power to transfer the property. 26. The third requirement of Section 41 of the said Act, is not discussed and is not in question. It was necessary for the defendant No.7 to prove that they had acted in good faith, but there is no allegations against them that they did not act in good faith. 27. In view of this, the defendant No.7 has failed to prove that they are entitled to the protection under Section 41 of the said Act. 19 S.A.NO.334 /2007. 28. The appeal should fail. The appeal stands dismissed. (A.V.NIRGUDE,J.) Dt.29.08.2009. . At the request of learned Advocate for the appellant, the effect of this order and the decree passed in favour of respondents shall stand in abeyance for a period of eight weeks from the date of the signature on the judgment. (A.V.NIRGUDE,J.) lkp