Karnataka High Court
Metropolitan Co-Operative vs Smt Salma K Fahim on 9 June, 2023
Author: S.R.Krishna Kumar
Bench: S.R.Krishna Kumar
-1-
NC: 2023:KHC:31726
WP No. 11988 of 2020
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 9TH DAY OF JUNE, 2023
BEFORE
THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR
WRIT PETITION NO. 11988 OF 2020 (CS-RES)
BETWEEN:
METROPOLITAN CO-OPERATIVE
HOUSING SOCIETY LTD.,
VIDHANA SOUDHA,
BENGALURU-560001,
REPRESENTED BY ITS SECRETARY.
...PETITIONER
(BY SRI. A.RAVISHANKAR, ADVOCATE)
AND:
1. SMT. SALMA K. FAHIM,
AGED 38 YEARS,
D/O. KHAJA FAHIMUDDIN AHEMD,
W/O. SRI.P.MANIVANNAN,
PRESENTLY WORKING AS MANAGING DIRECTOR,
HATTI GOLD MINES CO.LTD.,
KHB SHOPPING COMPLEX, NGV, KORAMANGALA,
Digitally BENGALURU-560025.
signed by
LEELAVATHI
SR 2. THE JOINT REGISTRAR
OF CO-OPERAATIVE SOCIETIES,
Location: BENGALURU DIVISION,
High Court of CHAMARAJPET, BENGALURU-560001.
Karnataka
...RESPONDENTS
(BY SRI.AJESH KUMAR S., ADVOCATE FOR R1;
SMT.ANITHA N., HCGP FOR R2)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227
OF THE CONSTITUTION OF INDIA, PRAYING TO CALL FOR RELEVENT
RECORDS FROM R-2 AND THE KAT; QUASH THE JUDGMENT OF THE
KAT IN APPEAL NO.43/2016 DATED 30.09.2019 AT ANNEXURE-W;
QUASH THE RECORDS PASSED BY THE R-2 HEREIN IN DISPUTE
DATED 25.01.2016 AT ANNEXURE-U.
-2-
NC: 2023:KHC:31726
WP No. 11988 of 2020
THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED
ON 12.12.2022 COMING ON FOR PRONOUNCEMENT OF JUDGMENT
THIS DAY, S.R.KRISHNA KUMAR J., DELIVERED FOLLOWING:-
JUDGMENT
1. The petitioner is a Housing Co-operative Society registered u/s 7 of the Karnataka Co-operative Societies Act, 1959 (for short 'the said Act of 1959'). The respondent No.1 is a member of the petitioner-Metropolitan Co-operative Society Ltd.(for short, 'the Society'). As can be seen from the bye-laws of the Society, one of its objects is to acquire lands from the government and statutory authorities including the CITB, BDA etc., and form layouts and allot Sites in favour of its members.
2. At the request of the Society, an extent of 22.19 acres of land across various survey numbers of Jakkur village, Yelahanka Hobali, Bangalore South Taluk was allotted to the Society by way of bulk allotment vide communication/bulk allotment letter dated 05.02.2007 issued by the Bangalore Development Authority (for short 'the BDA') in favour of the Society, which deposited a sum of Rs.11,83,000/- with the BDA towards the said bulk -3- NC: 2023:KHC:31726 WP No. 11988 of 2020 allotment. Pursuant thereto, on 21.06.2007 and 11.04.2008, the BDA issued letters, orders etc., to the Society calling upon them to comply with and adhere to the provisions contained in the Bangalore Development Authority (Allotment of Sites) Rules, 1984 (for short, 'the BDA Rules of 1984') in relation to the subject lands. In pursuance of the same, the subject layout comprising of residential plots was formed by the petitioner Society.
3. By letter dated 29.07.2010, respondent No.1 was provisionally allotted Site No. 66 by the Society after receiving a sum of Rs.5,00,000/- from the respondent No.1. In pursuance of the same, the Society issued a letter dated 13.08.2010 calling upon the respondent No.1 to pay the balance sum of Rs.10,52,155/- and accordingly, at the request of the respondent No.1, No Objection Certificate was issued by the Society in favour of the respondent No.1 on 23.08.2010. Pursuant thereto, the respondent No.1 took a loan from the State Bank of Mysore and paid a sum of Rs.10,52,155/- on 08.09.2010 and an additional sum of Rs.2,51,990/- on 13.06.2011 in favour of the Society. -4-
NC: 2023:KHC:31726 WP No. 11988 of 2020
4. The material on record discloses that on 16.08.2011, respondent No.1 married Sri P.Manivannan, who was also a member of the Society. In fact, the said Manivannan had also been provisionally allotted Site No.130 (old No. 72) on 29.08.2008 by the Society. It is a matter of record that the provisional allotment of Site No.66 on 29.07.2010 in favour of the respondent No.1 and the provisional allotment of Site No.130 in favour of her husband, Manivannan on 29.08.2008 were both made prior to their marriage which took place on 16.08.2011.
5. On 25.11.2011, the Society addressed communications to both the respondent No.1 and her husband Manivannan intimating them that in view of their marriage as a result of which they became 'family members', and in the light of the bye-laws of the Society as well as the said BDA Rules of 1984, both of them together were not entitled to more than one Site each, since they were family members. In the said communications, the Society intimated both the respondent No.1 as well as her husband, Manivannan that a resolution had been passed by the -5- NC: 2023:KHC:31726 WP No. 11988 of 2020 Society to offer either of the two Sites bearing No. 66 or 130 provisionally allotted to respondent No.1 and her husband respectively and an option was provided to them to retain/choose/opt for either of the two provisionally allotted Sites and surrender the other Site so as to enable the Society to execute a registered sale deed in their favour in respect of the Site so selected, chosen, opted and sought to be retained by them.
6. On 05.12.2011 (wrongly typed as 05.11.2011), respondent No.1's husband, Manivannan addressed a letter to the Society requesting some time to take a decision in this regard. Subsequently, on 30.12.2011, the said Manivannan issued one more letter stating that both himself and his wife, the respondent No.1 had decided that they intend to retain Site No. 130 provisionally allotted to him and that insofar as Site No. 66 provisionally allotted to the respondent No.1 was concerned, both of them would abide by the decision of the Society in this regard. In the said reply, Manivannan stated that both of them had decided to retain Site No.130 provisionally allotted to him and requested the Society to -6- NC: 2023:KHC:31726 WP No. 11988 of 2020 register the lease-cum-sale agreement in his favour in respect of Site No. 130 and not in respect of Site No.66 provisionally allotted to respondent No.1.
7. In pursuance of the aforesaid communications, a Board Meeting of the Society was held on 10.02.2012 in which it was resolved to accept the request of respondent No.1 and Manivannan and to register Site No.130 in the name of Manivannan and to cancel Site No.66 which had been provisionally allotted in favour of the respondent No.1. The said decision of the Society was intimated to the respondent No.1 and Manivannan vide communication dated 13.02.2012 and an allotment letter dated 14.02.2012 was issued by the Society in favour of Manivannan along with a sketch in relation to Site No. 130 allotted to him. In pursuance of the same, the Society also executed a registered lease cum sale agreement dated 15.02.2012 in favour of Sri Manivannan, the husband of respondent No.1.
8. Subsequently, on 04.05.2012, the respondent No.1 raised a dispute before the respondent No.2-Joint -7- NC: 2023:KHC:31726 WP No. 11988 of 2020 Registrar of Co-operative Societies seeking quashing of the aforesaid communication dated 13.02.2012 cancelling Site No. 66 provisionally allotted to her and for a direction to the Society to execute sale deed in her favour. In the said dispute, the Society was arrayed as a respondent and it filed its statement of objections and contested the proceedings. During the course of trial, the respondent No.1 did not adduce oral or documentary evidence. The Society examined its authorised representative, Seenappa Reddy as RW-1 who was cross-examined by the respondent No.1. The petitioner- society also examined the said Manivannan, husband of respondent No.1 as RW-2, but the respondent No.1 did not cross-examine RW-2. Further, documentary evidence at Ex.R-1 to R-23 were marked on behalf of the Society.
9. After hearing the parties, the JRCS allowed the petition filed by the respondent No.1 by passing the impugned order dated 25.01.2016 which was assailed by the Society before the Karnataka Appellate Tribunal in Appeal No. 43/2016 which was also dismissed by the KAT vide impugned order dated 30.09.2019. Aggrieved by the -8- NC: 2023:KHC:31726 WP No. 11988 of 2020 impugned orders passed by the respondent No.2-JRCS and the KAT, the Society is before this Court by way of the present petition.
10. I have heard Sri A. Ravishankar, learned counsel for the petitioner and Sri Ajesh Kumar S, learned counsel for the respondent No.1 and learned HCGP for the second respondent and perused the material on record.
11. In addition to reiterating the various contentions urged in the petition and referring to the material on record, learned counsel for the petitioner submitted that the impugned orders passed by the JRCS and KAT are illegal, erroneous and contrary to law and the material on record and the same deserve to be set aside. It was submitted that the said BDA Rules of 1984 as well as the bye-laws of the Society prohibit more than one member of a family to have more than one Site and as such, an option was provided to both the respondent No.1 and her husband to choose/ elect / select as to which one Site among Site No. 66 (provisionally allotted to respondent No.1) and Site No. 130 (provisionally allotted to her husband Manivannan) they would want to -9- NC: 2023:KHC:31726 WP No. 11988 of 2020 retain and upon receiving reply from them that they intended to retain Site No.130 and not Site No. 66, the Society passed a resolution and cancelled Site No. 66 and allotted Site No. 130 and executed lease-cum-sale agreement in favour of the respondent No.1 husband in accordance with the BDA Rules of 1984 and the bye laws of the Society.
12. It is submitted that both the JRCS and KAT have failed to appreciate that there was only a provisional allotment in favour of the respondent No.1 in respect of Site No. 66 and the same did not confer/create any vested right in her favour so as to prevent the petitioner Society from cancelling the same after her marriage with Manivannan as a result of which both of them being family members were not entitled to more than one Site and had chosen Site No. 130 and not Site No. 66. It is also contended that the respondent No.1 and her husband had voluntarily chosen to retain only Site No. 130 and not Site No. 66 by communicating the same to the Society and after having done so, the respondent No.1 was estopped from putting forth a claim over Site No. 66 once again. It was also
- 10 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 submitted that both the JRCS and the KAT have committed an error in coming to the conclusion that the Society was not entitled to cancel the allotment of Site No.66 in favour of respondent No.1 by improper and erroneous appreciation of the material on record. It is therefore submitted that the impugned orders passed by the JRCS and KAT deserve to be set aside and the dispute raised by the respondent No.1 was liable to be dismissed.
13. In support of his contentions, learned counsel for the petitioner relied upon the following judgments:
a) Felicia Fali Variaba vs. BDA - 1999 (2) KLJ 684
b) Jalandhar Improvement Trust Vs. Sampuran Singh - AIR 1999 SC 1347
14. Per contra, learned counsel for the respondent No.1 submitted that the BDA Rules of 1984 were not applicable to the allotment of Sites in favour of both respondent No.1 and her husband. Further, the eligibility criteria prescribed under the bye laws of the Society or the BDA Rules of 1984 would be applicable only at the stage of allotment and would not be applicable subsequently and
- 11 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 since the allotment of both Site No. 66 and 130 in favour of the respondent No.1 and Sri Manivannan had been done prior to their marriage, the Society was not entitled to cancel the same and both of them would be entitled to obtain a sale deed in respect of both Sites in their favour. It was also submitted that the actions of her husband were not binding upon the respondent No.1 and the unilateral cancellation by the Society of Site No.66 was not binding upon her merely because her husband had intimated the petitioner Society about his intention to retain Site No. 130 and not Site No.
66. It was therefore submitted that both the JRCS and the KAT had correctly and properly appreciated the material on record and has upheld the claim of the respondent No.1 and rejected the claim of the Society and as such there is no merit in the petition and the same is liable to be dismissed.
15. In support of his contentions, learned counsel for the respondent No.1 relied upon the following judgments:
a) Swadesh Vs. Haradeb Banerjee - AIR 1992 SC 1590;
b) Nainappa Setty Vs. BDA - 1996 (5) KLJ 792;
c) Binny Mill Labour Welfare HBCS Ltd. Vs. D.R. Mrutyunjaya Aaradhya - ILR 2008 KAR. 2245;
- 12 -
NC: 2023:KHC:31726 WP No. 11988 of 2020
d) Govindaraja Shetty Vs. Vishwa Bharathi HBCS - Manu/Ka/0226/2009
e) Mohinder Singh Gill Vs. Chief Election Commissioner - AIR 1978 SC 851
f) Commissioner of Police Vs. Gordhandas Bhanji - AIR 1952 SC 16
g) Co-Op. Central Bank Ltd. Vs. Addl. Industrial Tribunal - AIR 1970 SC 245
h) B.L. Sreedhar Vs. K.M. Muni Reddy - AIR 2003 SC 578
i) M. Elango Vs. State of Karnataka - WP No. 15491/2020 dated 10.08.2022
j) K. Pankaja Prabhudev Vs. B.D.A. - WP No. 7396/2011 dated 12.08.2011
k) The Commissioner, BDA Vs. Dr. Rajvir P. Sharma - RFA No. 1701/2016 dated 01.09.2017
l) Subramani Vs. Union of India - 1995 SCC Online Kar. 393
m) Bangalore City Co-Op. Housing Society Ltd., Vs. State of Karnataka (2012) 3 SCC 727
n) Lakshmi Precision Screws Vs. Ram Bhagat (2002) 6 SCC 552
o) G. Veerappa Pillai Vs. Raman - AIR 1952 SC 192
p) Vice Chairman, Kendriya Vidyalaya Vs. Giridharilal Yadav (2004) 6 SCC 325
q) Bheemappa Vs. Allisab (2006) SCC Online Kar. 153
16. During the pendency of the present petition, respondent No.1 filed I.A. No.1/2022 under Order XLI Rule
- 13 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 27 CPC r/w Articles 226 and 227 of the Constitution of India for permission to produce additional documents. The said application has been opposed by the petitioner who has filed his statement of objections.
17. I have given my anxious consideration to the rival submissions and perused the material on record.
18. In my considered opinion, the impugned orders passed by the JRCS and KAT are contrary to law as well as the material on record and the same deserve to be set aside and the claim petition filed by the respondent No.1 deserves to be dismissed for the following reasons:
18.1 It is the specific contention of the petitioner that the BDA Rules of 1984 were applicable to allotment of Sites formed in the subject layout including the Sites allotted in favour of the respondent No.1 and her husband; per contra, respondent No.1 contends that the BDA Rules of 1984 were not applicable and the allotments were governed only by the bye-laws of the Society. In this context, a perusal of the bulk allotment letter dated 05.02.2007 issued by the BDA to the
- 14 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 Society, communication dated 21.06.2007 addressed by the BDA to the petitioner-Society, work order dated 11.04.2008, bye-laws 4 and 10 of the petitioner-Society, the evidence of RW-1, Seenappa Reddy, authorised representative of the petitioner-Society and other material on record cumulatively establish that the BDA Rules of 1984 were applicable to the subject layout including the Sites allotted in favour of the respondent No.1 and her husband.
18.2 Rule 2(e) of the said Rules defines 'family' as to include husband, wife, etc. Rule 10 of the said Rules provides for eligibility for a person to be entitled to allotment of a Site. Rule 10(3) contemplates that only a person whose family does not own or has been allotted a Site would be entitled to get allotted a Site and the said provision specifically bars / disentitles a family member from being eligible/qualified to get a Site allotted in the event the said person or his family member already owned a Site or a house or had been allotted a Site or a house by the BDA or a Society.
- 15 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 18.3 In the instant case, the material on record discloses that the petitioner is undisputedly a Co-operative Society and the bulk allotment had been made in its favour subject to the condition that the formation of the subject layout and allotment of Sites by the petitioner Society in favour of its members would be subject to compliance of the provisions contained in the BDA Rules of 1984. The right of the petitioner Society to form a layout, to allot Sites in favour of its members and to do all necessary acts, deeds and things in this regard having originated / emanated from the aforesaid documents including the bulk allotment order, conditions of allotment, work order, etc., it is clear that the said BDA Rules of 1984 would be applicable to the Society and its members for the purpose of allotment of Sites. Under these circumstances, the contention of the respondent No.1 that the BDA Rules of 1984 are not applicable to the Society and its members cannot be accepted.
19. The respondent No.1 has contended that since the bye-laws of the Society do not expressly adopt the said BDA Rules of 1984, the same are not applicable nor binding
- 16 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 upon the Society or its bye-laws. This contention cannot be accepted inasmuch as the material on record referred to supra including the bulk allotment letter, conditions of allotment, work order, etc. issued by the BDA to the Society make unequivocally clear that the BDA Rules of 1984 would be applicable to the subject layout and the subject Sites of the Society and its members and as such, even this contention of the respondent cannot be accepted since mere non-reference to the said Rules in the bye-laws cannot lead to an inference that the same were not applicable to the Society. In fact, bye law 4(h) states that one of the objects of the Society was to secure allotment of Sites or houses for its members from the BDA, CITB, etc.; so also bye law 4(c) also provides for the petitioner Society to acquire lands and form layout on the lands acquired and release house Sites to its members in accordance with State Government norms.
19.1 It is relevant to state that bye-law 10(c) of the petitioner-Society also specifically contemplates that a member who has been allotted a Site, plot, house, flat, apartment by the Society or any other authority/ Society and
- 17 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 disposes of the same shall not be eligible for allotment of another Site etc. either in his name or in the name of his spouse. The said bye law reflects not only the objectives but also the intention of the Society and its members to restrict allotment of only one Site to either husband or wife and further states that even if a member who has been allotted a Site disposes of the same, neither the said member nor his wife would be entitled to allotment of one more Site. It is well settled that the bye laws of the Society are nothing but a contract between the members of the Society and all the members including the respondent No.1 having unequivocally agreed among themselves that in the event there was an allotment in favour of either spouse, the other spouse would not be entitled to one more allotment, the respondent No.1 is clearly not entitled to seek allotment of Site No. 66 in the light of Site No.130 already having been allotted and conveyed in favour of her husband Manivannan. Under these circumstances also, the claim of respondent No.1 is liable to be rejected.
- 18 -
NC: 2023:KHC:31726 WP No. 11988 of 2020
20. The undisputed material on record discloses that the allotment in favour of the respondent No.1 on 28.07.2010 and in favour of Manivannan on 29.08.2008 were prior to their marriage that was solemnized on 16.08.2011. A perusal of the impugned orders passed by the JRCS and KAT will indicate that both of them have proceeded on the basis that the provisional allotment had created a vested right in Site No.66 in favour of respondent No.1 and her subsequent marriage did not take away or divest that right and consequently, the Society did not have a right to cancel the provisional allotment.
20.1 In this context, it is relevant to state that dictionary meaning of the expression, 'provisional' is 'temporary', 'tentative', 'for the time being', 'subject to revision', 'conditional', 'contingent', 'only for the present time but likely to change' etc. Interestingly, neither the bye-laws nor the BDA Rules of 1984 provide for 'provisional allotment' despite which the Society has consciously only issued 'provisional allotment letters' and not 'allotment letters' in favour of both respondent No.1 and
- 19 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 Manivannan which is a pointer to the fact that the said allotments were merely provisional and no right over the provisionally allotted Sites accrued in favour of the respondent No.1 and Manivannan.
In Haryana State Industrial Development Corporation Ltd. Vs. Inderjeet Sawhney, (1996) 7 SCC 339, the Hon'ble Apex Court held as under:
"13. It is further to be borne in mind that the letter dated 27-12-1984, on which reliance is placed by the respondent and on the basis of which the High Court had given relief, it was stated that the said letter was only a provisional letter of allotment and it was specifically mentioned therein that the same "shall not give you any legal right for allotment unless a final allotment letter is issued". There was, therefore, no final commitment to allot one acre of land to the respondent and the High Court clearly misconstrued the said provisional letter of allotment to mean as if the respondent had acquired a vested right to obtain an allotment of one acre of land."
20.2 A perusal of the said 'provisional allotment letters' will also indicate that they were only tentative/ provisional allotments under which the total sital value had also not been finalized/ fixed and the respondent No.1 and Manivannan were both intimated that the difference in the total payment and actual payment will be considered for
- 20 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 interest to be paid proportionately with regard to interest borne by the Society to repay back its loan. The said provisional allotment letters also state that extra payment from them may be needed to be made for developing the subject layout and it was only when the lay out was developed and the BDA clearance was to be obtained and that permission for registration would be given on payment of the actual cost including the cost of registration of the lease cum sale agreement. In fact, when the provisional allotment letters dated 28.07.2010 and 29.08.2008 were issued in favour of the respondent No.1 and Manivannan by the Society, the subject layout had not been fully developed and Sites had not been completely formed and many developmental works were still pending to be done in the layout.
20.3 So also, the contents of the provisional allotment letters will clearly indicate that the same were only tentative/ provisional in nature and no vested right in the Sites had been created in their favour. Similarly, the other material on record including bulk allotment letter, conditions of
- 21 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 allotment, work order etc., all issued by the BDA in favour of the Society also indicate that the provisional allotment of Sites would always be subject to the conditions imposed by the BDA. Under these circumstances, it is clear that allotment of Sites in favour of respondent No.1 and Manivannan were merely provisional /tentative/temporary/conditional/contingent and no vested right had accrued in their favour finding is recorded by the JRCS and KAT are erroneous, illegal and contrary to law and the material on record and the same deserve to be set aside.
20.4 There is no gainsaying the fact that the prescribed eligibility/qualification for allotment of a Site, both under the BDA Rules of 1984 as well as the bye-laws mandates that neither the allottee nor his family members should own or possess a Site or house and in the event they own or possess a Site or a house, they are rendered ineligible/disqualified for allotment of one more Site by the Society; the object of the said embargo is to ensure fair, equitable and proper allotment of Sites among all members; it follows there from that the said pre-condition which
- 22 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 debars/prohibits allotment of one more Site should not only exist at the time of allotment but the same should continue to subsist even thereafter till execution of a lease-cum-sale agreement in favour of the allottee; further, if supervening/intervening events occur/transpire during the period from the date of allotment till the date of execution of a conveyance which would have the effect of disqualifying the allottee and making him ineligible, the said allottee would not be entitled to seek execution of a conveyance in his favour.
20.5 In other words, to enable an allottee to seek execution of a conveyance in respect of a Site allotted in his favour, it is not sufficient that the said allottee is qualified or eligible as on the date of the allotment, but it is essential that the said qualification/ eligibility continues and subsists up to the date of execution of a conveyance in his favour and any disqualification / ineligibility incurred by him during the intervening period would disentitle him from seeking execution of a conveyance in his favour. In the instant case, apart from the fact that the respondent No.1 and
- 23 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 Manivannan were only provisional allottees of their respective Sites, having regard to the undisputed fact that they got married on 16.08.2011 before a conveyance was executed in their favour, the said supervening / intervening event of their marriage which made both of them family members thereby disqualifying and debarring both of them to claim two separate Sites clearly had the effect of prohibiting/preventing them from claiming both the Sites and consequently, the Society was fully justified in calling upon them to choose any one of the two Sites and after they opted/elected to choose Site No. 130, the Society cancelled Site No. 66 originally provisionally allotted in favour of respondent No.1; both the JRCS and the KAT have failed to consider and appreciate these aspects of the matter and the same has resulted in erroneous conclusion.
20.6 Rule 13 of the B.D.A. Rules, 1984, provide that lease cum sale agreement would be executed in favour of the allottee only after conditions of allotment are fulfilled and complied with by the allottee; in the instant case, undisputedly the conditions for allotment of both Site No. 66
- 24 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 and 130 included the condition that both the respondent No.1 and her husband do not possess/own any other Site and since they got married prior to execution of a lease cum sale agreement, it is clear that the said conditions were not complied with or fulfilled by them and on this ground also, the Society was justified in cancelling the allotment of Site No. 66 and executing a lease cum sale agreement in respect of Site No. 130 in favour of the husband of respondent No.1.
20.7 The aforesaid facts and circumstances clearly establish that in addition to the fact that the provisional allotment made in favour of respondent No.1 did not create any vested/ indefeasible right in her favour which was incapable of being cancelled by the Society, the alleged right did not continue or subsist after her marriage with Manivannan prior to execution of a conveyance in their favour and consequently, in view of execution of a lease cum sale agreement in respect of Site No. 130 in favour of Manivannan, the claim of the respondent No.1 that she was also entitled to a lease cum sale agreement in respect of Site
- 25 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 No. 66 which stood cancelled cannot be accepted and the same is liable to be rejected.
21. It is well settled that if a party does not enter the witness box or adduce oral evidence by examining himself/herself, adverse inference would necessarily have to be drawn against the party for not producing the best evidence; it is equally well settled that the burden of proving his/her claim rests upon a party approaching a court/forum and it is only after the said burden is discharged that the burden of rebutting/impeaching the said evidence would shift on to the opposite party. In the instant case, despite the Society filing its statement of objections and opposing/contesting her claim, respondent No.1 did not adduce any oral or documentary evidence in support of her contentions thereby warranting not only drawing of adverse inference against her but also leading to the conclusion that she had not established her claim by adducing any legal or acceptable evidence. Under these circumstances, except the self serving statement made by the respondent No.1 in her claim petition before the JRCS, in the absence of any legal or
- 26 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 acceptable evidence adduced by her to substantiate/establish her claim, I am of the considered opinion that the various claims/ contentions urged by the respondent No.1 are liable to be rejected.
22. In addition to the fact that the respondent No.1 did not adduce any evidence whatsoever in support of her claim, the Society examined its authorized representative as RW-1 and Manivannan, husband of respondent No.1 as RW-2 and got marked documentary evidence at Ex.R.1 to R.23 before the JRCS. A perusal of the said evidence will indicate that while the said Manivannan (RW-2) has supported the claim of the Society, his evidence does not substantiate the various claims and contentions urged by the respondent No.1. In fact, RW-2 admits to the fact that subsequent to his marriage with respondent No.1, the Society called upon both of them to choose either Site No. 66 allotted to her or Site No. 130 allotted to him and pursuant to them voluntarily opting / choosing to retain Site No. 130 and surrendering Site No. 66, the Society had executed a lease cum sale agreement dated 15.02.2012 in his favour in respect of Site
- 27 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 No. 130 after cancelling the allotment of Site No.66 which had been provisionally allotted in favour of respondent No.1.
23. So also, the evidence of RW-1, authorized representative of the Society has not been discredited or impeached in the cross examination by the respondent No.1, who has not adduced any evidence whatsoever, much less any contra evidence in support of her claim. Under these circumstances, I am of the view that while the Society had placed sufficient material to substantiate its defence, the absence of any legal or acceptable evidence adduced by the respondent No.1 was sufficient to come to the conclusion that her claim was liable to be rejected.
24. The material on record discloses that after the respondent No.1 got married to Manivannan on 16.08.2011 and intimated the same to the Society on 21.09.2011, the Society addressed two separate communications both dated 25.11.2011 calling upon them to choose/opt for either of the Sites provisionally allotted to them since they had become family members by then and that they should surrender either of the two Sites so as to enable the Society to execute
- 28 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 a lease cum sale agreement in respect of the retained Site in favour of either of them at their option. In this context, a perusal of the reply dated 05.12.2011 (wrongly typed as 05.11.2011 since the Society's letter is itself dated 25.11.2011) issued by Manivannan will indicate that both himself and respondent No.1 had requested some time to take a decision as regards which of the two Sites they intended to retain.
25. Subsequently, Manivannan addressed a letter dated 30.12.2011 on behalf of himself as well as respondent No.1 wherein it is categorically stated that both himself and respondent No.1 intended to retain Site No. 130 allotted to him and that they would abide by the decision to be taken by the Society as regards Site No. 66. In pursuance of the same, a Board Meeting of the Society was conducted on 10.02.2012 wherein it was unanimously decided to cancel allotment of Site No. 66 made to respondent No.1 and register Site No. 130 as per the request of Manivannan and respondent No.1. The said Board Meeting was followed by a communication dated 13.02.2012 addressed to respondent
- 29 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 No.1 and allotment letter (not provisional allotment) dated 14.02.2012 in favour of Manivannan in respect of Site No. 130 which culminated in a registered lease cum sale agreement dated 15.02.2012 by the Society in favour of Manivannan who is also one of the executants of the said agreement. It is only thereafter, i.e., on 04.05.2012, that the respondent No.1 initiated the instant proceedings before the JRCS after a lapse of more than 2½ months. The aforesaid sequence of events clearly establish that cancellation of Site No. 66 provisionally allotted in favour of respondent No.1 and execution of lease cum sale agreement in respect of Site No. 130 in favour of Manivannan was legal, correct and proper and the claim of respondent No.1 in this regard is liable to be rejected.
26. A perusal of the material on record including the impugned orders will indicate that the respondent No.1 has neither pleaded nor contended anywhere that she did not have knowledge about either the communication dated 25.11.2011 addressed to her and her husband or that she did not have knowledge about her husband issuing a reply
- 30 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 dated 30.12.2011 requesting the petitioner Society to execute a sale deed in respect of Site No. 130 and not Site No. 66. In this context, at paragraph No. 6 of the petition filed by her before the JRCS, respondent No.1 has admitted having received the said letter dated 25.11.2011 and there are no further pleadings or contentions in this regard except referring to a subsequent letter of cancellation dated 13.02.2012.
27. It is well setttled that husband and wife have fiduciary relationship with each other which is based on mutual trust and confidence. In the instant case, the material on record disclsoes that both respondent No.1 and her husband Manivannan had mutual relationship with each other and in the absence of any contra/rebuttal evidence, the only inference that can be drawn is that both were acting in a fiduciary capacity with each other. There is also no pleading or contention that her husband did not inform the respondent No.1 about accepting Site No. 130 and not Site No. 66 and the petitioner Society accepting the same and executing a registered sale deed in his favour. It is also not
- 31 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 her contention that the relationship between herself and her husband had been strained either at that time or subsequently. This conduct of the respondent No.1 as borne out from her pleadings at the earliest point in time is sufficient to indicate that the respondent No.1 was not only fully aware about the reply dated 30.12.2011 issued by her husband deciding to retain Site No. 130 and not Site No. 66 but also that the said decision was made jointly and unanimously by the respondent No.1 and her husband and consequently, respondent No.1 was estopped from challenging the cancellation, particularly after the petitioner Society executed registered sale deed on 15.02.2012 in favour of her husband in respect of Site No. 130. Under these circumstances, claim of respondent No.1 is liable to be rejected.
In the case of LIC Vs. Rajiv Kumar Bhasker (2005) 6 SCC 188, the Hon'ble Apex Court has held as under:
36. A somewhat similar view was taken by the House of Lords in Branwhite v. Worcester Works Finance Ltd. [(1969) 1 AC 552 : (1968) 3 All ER 104 : (1968) 3 WLR 760 (HL)] in the following terms: (All ER p. 122 D-
G)
- 32 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 "In the Garnac case [Garnac Grain Co. v. Faure (H.M.F.) & Fairclough Ltd., (1967) 2 All ER 353 :
(1967) 3 WLR 143] Lord Pearson, with the concurrence of the House, used these words:
'The relationship of principal and agent can only be established by the consent of the principal and the agent. They will be held to have consented if they have agreed to what amounts in law to such a relationship, even if they do not recognise it themselves and even if they have professed to disclaim it.... The consent must, however, have been given by each of them, either expressly or by implication from their words and conduct.' The significant words, for the present purpose, are 'if they have agreed to what amounts in law to such a relationship'. These I understand as pointing to the fact that, while agency must ultimately derive from consent, the consent need not necessarily be to the relationship of principal and agent itself (indeed the existence of it may be denied) but may be to a state of facts on which the law imposes the consequences which result from agency. It is consensual, not contractual. So interpreted, this formulation allows the establishment of an agency relationship in such cases as the present."
37. Yet again in Armagas Ltd. v. Mundogas S.A. [1986 AC 717 : (1986) 2 All ER 385 : (1986) 2 WLR 1063 (HL)] the House of Lords pointed out that even in the absence of any express contract of agency in relation to the transaction made with the third party, ostensible authority may be presumed, stating: (All ER pp. 389j-390a) "Ostensible authority comes about where the principal, by words or conduct, has represented that the agent has the requisite actual authority, and the party dealing with the agent has entered into a contract with him in reliance on that representation.
The principal in these circumstances is estopped from denying that actual authority existed. In the commonly encountered case, the ostensible authority is general in character, arising when the principal has placed the agent in a position which in the outside world is generally regarded as carrying authority to enter into transactions of the kind in question.
- 33 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 Ostensible general authority may also arise where the agent has had a course of dealing with a particular contractor and the principal has acquiesced in this course of dealing and honoured transactions arising out of it."
38. In Gurtner v. Beaton [(1993) 2 Lloyd's Rep 369 (CA)] Their Lordships quoted with approval the following dicta from Freeman & Lockyer v. Buckhurst Park Properties (Mangal) Ltd. [(1964) 2 QB 480 : (1964) 1 All ER 630 : (1964) 2 WLR 618 (CA)] , (Freeman & Lockyer, All ER at p. 644 I):
"The representation which creates 'apparent' authority may take a variety of forms of which the commonest is representation by conduct, i.e. by permitting the agent to act in some way in the conduct of the principal's business with other persons."
39. It was further held (in Gurtner v. Beaton):
"In applying that principle the correct approach is to consider the whole of the conduct of Cleanacres Ltd. in the light of all the circumstances in order to determine whether that conduct amounted to a holding out by them of Mr Beaton as having the necessary authority: see per Lord Justice Browne- Wilkinson in Raffaella, The [ sub nom Egyptian International Foreign Trade Co. v. Soplex Wholesale Supplies Ltd., (1985) 2 Lloyd's Rep 36 (CA)] at p.
41. It is not right to concentrate on the use of the word 'usually' by Lord Justice Diplock in Freeman & Lockyer [(1964) 2 QB 480 : (1964) 1 All ER 630 :
(1964) 2 WLR 618 (CA)] at p. 503 and to treat it as decisive in this case on the ground that an aviation manager cannot be regarded as 'usually' having authority to make a contract for air taxi work when the aviation business of which he is manager does not include such work."
40. Agency as is well settled, is a legal concept which is employed by the Court when it becomes necessary to explain and resolve the problems created by certain fact situations. In other words, when the existence of an agency relationship would help to decide an individual problem, and the facts permits a court to conclude that
- 34 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 such a relationship existed at a material time, then whether or not any express or implied consent to the creation of an agency may have been given by one party to another, the Court is entitled to conclude that such relationship was in existence at the time, and for the purpose in question. [See Establishing Agency by GHL Fridman -- 1968 (84) Law Quarterly Review 224 at p. 231.] In the case of Foujdar Kameshwar Dutt Singh Vs. Ghanshyamdas (1987) SUPP. SCC 689, it was held as under:
The High Court has found that Kameshwar Dutt Singh, though a major on the date when the suit property was sold by his elder brother to the plaintiff, was aware of the sale. His mother was aware and everyone in the village was also aware of the sale. The sale was not a secret affair. It was an open transaction. It was the elder brother who was managing the property all the time with the active association and cooperation of the mother. Kameshwar Dutt Singh was not in a position to manage the land as he was elsewhere studying. Even after the sale he allowed the plaintiff- purchaser to be in possession of the land for nearly seven years. In addition, he along with his brothers executed a document Ex. 2-D 1, by which they chose to affirm all the acts done by their elder brother, Satya Prakash Singh, who was actually managing their affairs. On those facts, the High Court held that a case of implied agency had been established. We are unable to take a different view of the matter. We, therefore, confirm the judgment and decree of the High Court and dismiss the appeal. No costs.
In the case of Wing Commander A.S. Krishna Murthy Vs. Madhukar A. Shah (1992) SCC Online Kar.
11, it was held as under:
- 35 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 6.1. In the light of these contentions, the following points arise for consideration:
1. Whether failure to recast the issues after the 2nd defendant filed the written statement, has caused prejudice to the 2nd defendant?
2. Whether the trial Court is justified in law and on facts in applying the principle of agency and holding the appellant - 2nd defendant - liable for the decretal amount?
3. Whether the trial Court has drawn the decree in conformity with the judgment?
4. Whether the appellant - 2nd defendant - is entitled to instalments for paying the amount decreed?POINT NO. 2
9. On the basis of the evidence, the trial Court has held that the appellant has proved that taking of the house on rent by the 1st defendant through the Rent Controller on a rent of Rs. 1300/- per month was with the implied authority of the 2nd defendant; therefore, he was liable for the suit claim. In para 13 of the judgment, the learned trial Judge has summarised his conclusion as follows:
"Looking to the contentions urged by the parties it clearly appears from the material that the 1st defendant had all implied authority to take the allotment of house. Circumstances of the 2nd defendant using the address of the premises in question in his letter heads - issuing cheques towards arrears of rent and his admission in evidence that he was sending money for maintenance of his family and admission that he lived with family in the premises in question after his retirement for about 4 to 5 months and his admission in evidence that he was visiting his family frequently when he was staying at Belgaum when the family was staying in the premises in question - all these factors clearly goes to show that 2nd defendant has acquiesced the allotment of house made in favour of his family. As contended by the Counsel for the plaintiff, it is also observed by the Special Deputy Commissioner in his order that the status of 2nd defendant and his income was taken into consideration while alloting
- 36 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 house to the 1st defendant who was getting only salary of Rs. 900/- p.m. whereas the rent fixed was Rs. 1,300/- p.m. During the time of tenancy and occupation, there was valid marriage subsisting between the 1st and 2nd defendants. The authorities cited at the Bar by plaintiff clearly go in favour of plaintiff's case and admitting of the lease or letting of the property in favour of 1st defendant for the benefit of the family of the 2nd defendant is very much a necessity that was supplied and that, 1st defendant had all the implied authority of pledging the credit of her husband and it is also come in evidence that, 1st defendant was managing the affairs of the family and she was looking after the children. Therefore, under the circumstances I am of opinion that, both the defendants are liable to pay the suit claim."
10. Before us, it is not disputed by the appellant who has appeared in person that when the house was taken on rent by the first defendant and possession was obtained on 9-4-1984, the relationship of husband and wife between the appellant and the first defendant was subsisting. It is also not disputed before us that he issued two cheques towards the rent of the premises. It is also not disputed that he used the address of the house in his letter head and also visited on more than one occasion the first defendant, and lived in the schedule premises. Over and above, after the retirement he lived in the schedule premises along with the 1st defendant for a period of four to five months. These circumstances which are not in dispute have been, in our view, rightly held to be sufficient by the trial Court to prove the implied authority of the 1st defendant to secure the shcedule premises on a rent of Rs. 1300/- per month on behalf of the 2nd defendant as his wife. In addition to this, the 2nd defendant has also approved the act of the 1st defendant in taking the schedule house on rent by residing in it along with the 1st defendant. An implied agency arises from the act or situation of the parties or from necessity. Section
- 37 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 187 of the Indian Contract Act, 1872 also provides that an authority is said to be express when it is given by words spoken or written. An authority is said to be implied when it is to be inferred from the circumstances of the case; and things spoken or written or the ordinary course of dealing, may be accounted circumstances of the case. The very relationship of husband and wife between the 2nd defendant and the 1st defendant is a familiar and special case of implied agency. The liability of a husband for his wife's debt is founded on the principles of agency, it has to be shown by the creditor that the husband has expressly or impliedly approved what the wife has done. An implied agency of a wife of her husband arises out of the marital obligations required to be discharged by the husband. Apart from other marital obligations, it is obligatory for a husband to provide food, shelter and clothing to his wife. Therefore, during the cordial relationship between them as husband and wife, in other words when a wife is not living separately from her husband due to estrangement or a legal proceeding or because of his marriage with a second wife, a wife will have implied authority of her husband to pledge her husband's credit to secure proper shelter, food and clothing according to the status of her husband and their style of living. The creditors are entitled to claim the debt incurred by her in that regard from a husband as long as the husband himself does not attend to all the aforesaid requirements and allows his wife to attend to the aforesaid necessities and has not made separate and specific allowance to her to meet the expenditure on account of the aforesaid necessities. Of course, the presumption of implied agency arising out of the special relationship of husband and wife can be rebutted by showing that the wife was prohibited to act on behalf of the husband or to attend to the necessities of life or by proving that sufficient allowance had been made to meet the expenditure
- 38 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 for meeting the necessities. Therefore, a person dealing with a wife and seeking to charge her husband for the debts incurred by his wife, is required to show either that the wife was living with her husband and managing the household affairs, in which case, an implied agency to buy necessities can be presumed or he must show that the existence of such state of things as it warrant her living apart from her husband and claiming support or maintenance, in which case, the law would give her an implied authority to bind her husband for necessaries supplied to her during such separation in the event of his not providing her with maintenance. 10.1. A Full Bench of Allahabad High Court in Girdhari v. W. Crawford [ILR Allahabad Series Vol. IX, 1887 @ 147.] , held that the liability of a husband for his wife's debts depended upon the principles of agency and the husband could be liable only when it was shown that he has expressly or impliedly sanctioned what the wife had done. Of course in the facts and circumstances of that case it was held that no agency on the wife's part for her husband was established and that the husband was therefore not liable to the claim.
10.2 In Mohamed Sultan Sahib v. Horace Robinson [ILR 1907 Madras 543.] , it was held that the presumption of implied authority on the part of the wife to pledge her husband's credit for necessities may be rebutted by proof of circumstances inconsistent with the existence of such authority.
10.3. In Baboolal Bhagwan Das v. M. Purcell [AIR 1936 Allahabad 869.] , it was held that where a wife executed a promissory note for a sum of money found to be due in respect of necessaries supplied to her while she and her husband lived together and she managed the household affairs, therefore it could be reasonably inferred from the circumstances that
- 39 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 the wife had express or implied authority to pledge the credit of her husband for the necessaries of life suited to their style of living, as such the husband was liable under the promissory note executed by his wife.
10.4. The aforesaid Decisions also accord with the view expressed by us above. It was obligatory on the part of the 2nd defendant to provide food, shelter and clothing to the 1st defendant. It was to discharge these obligations the 2nd defendant rightly approved the conduct of the 1st defendant in taking the house on rent. Therefore, we are of the view that the ultimate conclusion reached by the trial Court that the 2nd defendant is liable for the suit claim along with the 1st defendant as he had approved the act of the 1st defendant in taking the house on rent is justified. Therefore, the ultimate conclusion reached by the trial Court that the plaintiff is entitled to a decree for a sum of Rs. 27,300/- which included the interest from 9-4-1984 to 2-1-1986 is justified both on facts and in law. Awarding of interest at the rate of 6% from the date of suit till the date of realisation is also in accordance with law. Accordingly, Point No. 2 is answered in the affirmative.
28. A perusal of the material on record will indicate that during the course of all correspondence, transactions, etc. between the respondent No.1 and Manivannan on one hand and the Society on the other from the date of their marriage that took place on 16.08.2011 till 04.05.2012 when the respondent No.1 filed the claim petition before the JRCS, both Manivannan and respondent No.1 have acted jointly
- 40 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 and Manivannan has issued letters, communications, etc. on behalf of himself as well as his wife, the respondent No.1. As stated supra, respondent No.1 has not contended that there was any ill will/strained relationship between herself and Manivannan during the said period or that she was unaware as to what transpired in relation to the Sites provisionally allotted to both of them. It is well settled that agency/authorization by respondent No.1 in favour of her husband may be express or implied as contemplated in Sec.186 and 187 of the Indian Contract Act.
29. In the instant case, the conduct of the respondent No.1 and Manivannan from the date of their marriage on 16.08.2011 till she approached the JRCS on 04.05.2012 including execution of lease cum sale agreement in favour of Manivannan in respect of Site No. 130 on 15.02.2012 after cancelling allotment of Site No. 66 on 14.02.2012 as borne out from the material on record is sufficient to establish that the decision to retain Site No. 130 and surrender Site No. 66 was jointly, voluntarily and unanimously taken by both Manivannan and respondent No.1 and all acts, deeds and
- 41 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 things done by Manivannan were for himself as well as an agent of his wife, respondent No.1 which can be inferred and implied from the facts and circumstances obtaining in the case. The conduct of the respondent No.1 also supports the inference of ostensible authority/ implied agency on the part of her husband to do all acts, deeds and things for himself and also on her behalf in relation to retaining Site No. 130 and surrendering Site No.66 provisionally allotted to her.
30. The aforesaid facts and circumstances clearly establish that throughout, Manivannan was acting on behalf of himself as well as the respondent No.1 and the joint/ unanimous decision taken by both of them to surrender Site No. 66 and retain Site No. 130 as evident from the material on record was binding upon the respondent No.1 and her claim in this regard was liable to be rejected.
31. As rightly contended by the learned counsel for the petitioner, the claim of the respondent No.1 is clearly barred by the principles of estoppel, acquiescence, abandonment and waiver in as much as her conduct and the material on record referred to supra, will clearly indicate that
- 42 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 she voluntarily and jointly not only surrendered, abandoned and waived all her alleged rights over Site No. 66 provisionally allotted to her but also acquiesced to the cancellation of the same and execution of lease cum sale agreement in respect of Site No. 130 in favour of Manivannan.
In the case of Indira BaI Vs. Nand Kishore (1990) 4 SCC 668, it was held as under:
3. Estoppel is a rule of equity flowing out of fairness striking on behaviour deficient in good faith. It operates as a check on spurious conduct by preventing the inducer from taking advantage and assailing forfeiture already accomplished. It is invoked and applied to aid the law in administration of justice. But for it great many injustice may have been perpetrated. Present case is a glaring example of it. True no notice was given by the seller but the trial court and appellate court concurred that the pre-emptor not only came to know of the sale immediately but he assisted the purchaser-
appellant in raising construction which went on for five months. Having thus persuaded, rather misled, the purchaser by his own conduct that he acquiesced in his ownership he somersaulted to grab the property with constructions by staking his own claim and attempting to unsettle the legal effect of his own conduct by taking recourse to law. To curb and control such unwarranted conduct the courts have extended the broad and paramount considerations of equity, to transactions and assurances, express or implied to avoid injustice.
- 43 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 B.L. Sreedhar and Others Vs. K.M. Munireddy (Dead) and Others (2003) 2 SCC 355
13. Estoppel is a rule of evidence and the general rule is enacted in Section 115 of the Indian Evidence Act, 1872 (in short "the Evidence Act") which lays down that when one person has by his declaration, act or omission caused or permitted another person to believe a thing to be true and to act upon that belief, neither he nor his representative shall be allowed in any suit or proceeding between himself and such person or his representative to deny the truth of that thing. (See Sunderabai v. Devaji Shankar Deshpande [(1952) 2 SCC 92 : AIR 1954 SC 82] .)
14. "Estoppel is when one is concluded and forbidden in law to speak against his own act or deed, yea, though it be to say the truth" -- Co Litt 352(a), cited in Ashpitel v. Bryan [(1863) 3 B & S 474 :
122 ER 179 : 32 LJQB 91] B & S at p.
489; Simm v. Anglo American Telegraph Co. [(1879) 5 QBD 188 : 49 LJQB 392 : 42 LT 37 (CA)] , per Bramwell, L.J. at p. 202; Halsbury, Vol.
13, para 488. So there is said to be an estoppel where a party is not allowed to say that a certain statement of fact is untrue, whether in reality it be true or not. Estoppel, or conclusion, as it is frequently called by the older authorities, may therefore be defined as a disability whereby a party is precluded from alleging or proving in legal proceedings that a fact is otherwise than it has been made to appear by the matter giving rise to that disability. (Halsbury, Vol. 13, para 448) The rule on the subject is thus laid down by Lord Denman, in Pickard v. Sears [(1837) 6 Ad & El 469 : 112 ER 179] Ad & E at p. 474 : ER p. 181 "But the rule of law is clear, that, where one by his words or conduct wilfully causes another to believe the existence of a certain state of things, and induces him to act on that belief, so as to alter his own previous position, the former is concluded from
- 44 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 averring against the latter a different state of things as existing at the same time;"
"The whole doctrine of estoppel of this kind, which is a fictitious statement treated as true, might have been founded in reason, but I am not sure that it was. There is another kind of estoppel -- estoppel by representation -- which is founded upon reason and it is founded upon decision also." Per Jessel, M.R. in General Finance & Co. v. Liberator [(1878) 10 Ch D 15 : (1874-80) All ER Rep Ext 1597 : 39 LT 600] , Ch D at p. 20.
See also in Simm v. Anglo American Telegraph Co. [(1879) 5 QBD 188 : 49 LJQB 392 : 42 LT 37 (CA)] , QBD at p. 202 where Bramwell, L.J. said "An estoppel is said to exist where a person is compelled to admit that to be true which is not true, and to act upon a theory which is contrary to the truth."
15. On the whole, an estoppel seems to be when, in consequences of some previous act or statement to which he is either party or privy, a person is precluded from showing the existence of a particular state of facts. Estoppel is based on the maxim allegans contraria non est audiendus (a party is not to be heard to allege the contrary) and is that species of presumption juries et de jure (absolute or conclusive or irrebuttable presumption), where the fact presumed is taken to be true, not as against all the world, but against a particular party, and that only by reason of some act done, it is in truth a kind of argumentum ad hominem.
16. "In our old law books," said Mr Smith in his notes to Duchess of Kingston case [(1776) 1 East PC 468 : 1 Leach 146 : 168 ER 175] , "truth appears to have been frequently shut out by the intervention of an estoppel, where reason and good policy required that it should be admitted.... However, it is in no wise unjust or unreasonable, but, on the contrary, in the highest degree reasonable and just, that some solemn mode of declaration should be provided by law, for the
- 45 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 purpose of enabling men to bind themselves to the good faith and truth of representations on which other persons are to act."
"An estoppel is not a cause of action -- it is a rule of evidence which precludes a person from denying the truth of some statement previously made by himself." Per Lindley, L.J. in Low v. Bouverie [(1891) 3 Ch 82 : (1891-94) All ER Rep 348 : 65 LT 533 (CA)] , Ch at p. 101. In the same case, Ch at p. 105. Bowen, L.J. added:"Estoppel is only a rule of evidence, you cannot found an action upon estoppel." (All ER p. 355 D) Estoppel though a branch of the law of evidence is also capable of being viewed a substantive rule of law insofar as it helps to create or defeat rights, which would not exist or be taken away but for that doctrine.
Estoppel is a complex legal notion, involving a combination of several essential elements -- statement to be acted upon, action on the faith of it, resulting in detriment to the actor. Estoppel is often described as a rule of evidence, as indeed it may be so described. But the whole concept is more correctly viewed as a substantive rule of law.... Estoppel is different from contract both in its nature and consequences. But the relationship between the parties must also be such that the imputed truth of the statement is a necessary step in the constitution of the cause of action. But the whole case of estoppel fails if the statement is not sufficiently clear and unqualified. (Per Lord Wright in Canada & Dominion Sugar Co. Ltd. v. Canadian National (West Indies) Steamships Ltd. [(1946) 3 WWR 759 : 1947 AC 46] WWR at p. 764.) "The essential factors giving rise to an estoppel are, I think --
(a) A representation or conduct amounting to a representation intended to induce a course of conduct on the part of the person to whom the representation was made.
(b) An act or omission resulting from the representation, whether actual or by conduct, by the person to whom the representation was made.
(c) Detriment to such person as a consequence of the act or omission where silence cannot amount to a
- 46 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 representation, but, where there is a duty to disclose, deliberate silence may become significant and amount to a representation. The existence of a duty on the part of a customer of a bank to disclose to the bank his knowledge of such a forgery as the one in question was rightly admitted." (Per Lord Tomlin, Greenwood v. Martins Bank [1933 AC 51 :
1932 All ER Rep 318 : 101 LJKB 623 : 147 LT 441 (HL)] , All ER p. 321 C-E.) See also Thompson v. Palmer [(1933) 49 CLR 547] , Grundt v. Great Boulder [(1937) 59 CLR 675] and Central Newbury Car Auctions v. Unity Finance [(1957) 1 QB 371 : (1956) 3 All ER 905 :
(1956) 3 WLR 1068 (CA)] .
" 'Estoppe', commeth of a French word 'estoupe', from whence the English word stopped, and it is called an estoppel, or conclusion, because a man's owne act or acceptance stoppeth or closeth up his mouth to allege or plead the truth; and Littleton's case proveth this description" [Co Litt 352a, where it is said estoppel is of three kinds i.e. matter (1) of record, (2) in writing i.e. semble, by deed, (3) in Paiis]. To the same effect is the definition in Termes de la Ley. (See Stroud's Judicial Dictionary, 4th Edn., p. 943.)
17. "An estoppel," says Lord Coke, "is where a man is concluded by his own act or acceptance to say the truth". Mr Smith, in his notes to Duchess of Kingston case [(1776) 1 East PC 468 : 1 Leach 146 : 168 ER 175] characterizes this definition as a little startling but it nevertheless gives a good idea of what it is, by no means easy to include within the limits of a definition. (1 Smith LC 760)
18. Though estoppel is described as a mere rule of evidence, it may have the effect of creating substantive rights as against the person estopped. An estoppel, which enables a party as against another party to claim a right of property which in fact he does not possess is described as estoppel by negligence or by conduct or by representation or by holding out ostensible authority.
- 47 -
NC: 2023:KHC:31726 WP No. 11988 of 2020
19. Estoppel, then, may itself be the foundation of a right as against the person estopped, and indeed, if it were not so, it is difficult to see what protection the principle of estoppel can afford to the person by whom it may be invoked or what disability it can create in the person against whom it operates in cases affecting rights. Where rights are involved, estoppel may with equal justification be described both as a rule of evidence and as a rule creating or defeating rights. It would be useful to refer in this connection to the case of Depuru Veeraraghava Reddi v. Depuru Kamalamma [AIR 1951 Mad 403 :
(1950) 2 MLJ 575] where Vishwanatha Sastri, J.
observed : (AIR p. 405, para 7) "Estoppel though a branch of the law of evidence is also capable of being viewed as a substantive rule of law insofar as it helps to create or defeat rights which would not exist and be taken away but for that doctrine...."
20. Of course, an estoppel cannot have the effect of conferring upon a person a legal status expressly denied to him by a statute. But where such is not the case a right may be claimed as having come into existence on the basis of estoppel and it is capable of being enforced or defended as against the person precluded from denying it.
21. In his illustrious book Law of Estoppel, 6th Edn., Bigelow has noted as follows:
"Situations may arise, indeed, in which a contract should be held an estoppel, as in certain cases where only an inadequate right of action would, if the estoppel were not allowed, exist in favour of the injured party. In such a case the estoppel may sometimes be available to prevent fraud and circuity of action."
22. In another illustrious book Estoppels and the Substantive Law by Arthur Caspersz under the title "Conduct of Indifference or Acquiescence", it has been noted as follows:
"40. It is, however, with reference to the third class of cases that the greatest difficulty has arisen, especially where statements have been made,
- 48 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 expressly or by implication, which cannot properly be characterized as representations at all. It must now be regarded as settled that an estoppel may arise as against persons who have not wilfully made any misrepresentation, and whose conduct is free from fraud or negligence, but as against whom inferences may reasonably have been drawn upon which others may have been induced to act. The doctrine of acquiescence may be stated thus:
'If a person having a right, and seeing another person about to commit, or in the course of committing, an act infringing upon that right, stands by in such a manner as really to induce the person committing the act, and who might otherwise have abstained from it, to believe that he assents to it being committed, he cannot afterwards be heard to complain of the act.' (Duke of Leeds v. Earl of Amherst [(1846) 2 Ph 117 : 41 ER 886 : 16 LJ Ch 5] Ph at p. 123.) This is the proper sense of the term acquiescence, 'and in that sense may be defined as acquiescence, under such circumstances as that assent may be reasonably inferred from it, and is no more than an instance of the law of estoppel by words or conduct'. (De Bussche v. Alt [(1878) 8 Ch D 286 : (1874-80) All ER Rep 1247 : 38 LT 370] Ch D at p.
314.) Acquiescence is not a question of fact but of legal inference from facts found. (Lala Beni Ram v. Kundan Lall [(1899) 26 IA 58] .) The common case of acquiescence is where a man, who has a charge or incumbrance upon certain property, stands by and allows another to advance money on it or to expend money upon it. Equity considers it to be the duty of such a person to be active and to state his adverse title, and that it would be dishonest in him to remain wilfully passive in order to profit by the mistake which he might have prevented. (Ramsden v. Dyson [(1866) 1 HL 129 : (1865) LR 1 E & I, Ap. 129 : 14 WR 926 (HL)] E & I, Ap. at p. 140.) ***
42. In such cases the conduct must be such that assent may reasonably be inferred from it. The doctrine of acquiescence has, however, been stated to be founded upon conduct with a knowledge of legal rights, and as stated in some cases appears to
- 49 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 imply the existence of fraud on the part of the person whose conduct raises an estoppel. The remarks of the Judicial Committee, however, in Sarat Chunder Dey v. Gopal Chunder Laha [(1892) 19 IA 203] clearly extend the doctrine of estoppel by conduct of acquiescence or indifference to cases where no fraud whatever can be imputed to the person estopped, and where that person may have acted bona fide without being fully aware, either of his legal rights, or of the probable consequences of his conduct. In every case, as already pointed out, the determining element is not the motive or the state of knowledge of the party estopped, but the effect of his representation or conduct as having induced another to act on the faith of such representation or conduct.
Lapse of time and delay are most material when the plaintiff, by his conduct may be regarded as waiving his rights, or where his conduct, though not amounting to a waiver, has placed the other party in a situation in which it would not be reasonable to place him if the remedy were afterwards asserted. When, however, an argument against a relief, otherwise just, is founded upon mere delay not amounting to bar by limitation, the validity of that defence must be tried by principles substantially equitable."
23. In Snell's Principles of Equity, 27th Edn., Chapter 3, 12 maxims of equity have been indicated. Of these maxims Principles 5, 6 and 7 are relevant for the purpose of the case in hand. They are as follows:
"5. He who seeks equity must do equity.
6. He who comes into equity must come with clean hands.
7. Delay defeats equities, or, equity aids the vigilant and not the indolo vigilantibus, non dormientibus, jura subveniunt."
24. The following passage from the Law Relating to Estoppel by Representation by George Spencer, 2nd Edn. as indicated in Article 3 is as follows:
"It will be convenient to begin with a satisfactory definition of estoppel by representation. From a careful scrutiny and collation of the various judicial pronouncements on the subject, of which no single one is, or was perhaps intended to be, quite
- 50 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 adequate, and many are incorrect, redundant, or slipshod in expression; the following general statement of the doctrine of estoppel by representation emerges; where one person ('the representor') had made a representation to another person ('the representee') in words or by acts and conduct, or (being under a duty to the representee to speak or act) by silence or inaction, with the intention (actual or presumptive), and with the result, of inducing the representee on the faith of such representation to alter his position to his detriment, the representor in any litigation which may afterwards take place between him and the representee, is estopped, as against the representee, from making, or attempting to establish by evidence, any averment substantially at variance with his former representation, if the representor at the proper time, and in the proper manner, objects thereto."
25. In Article 1175 at p. 637 of Halsbury's Laws of England, 3rd Edn., Vol. 14, it is stated as follows:
"1175. Waiver is the abandonment of a right, and is either express or implied from conduct. A person who is entitled to the benefit of a stipulation in a contract or of a statutory provision (a) may waive it...."
"The essence of waiver is 'estoppel' and where there is no 'estoppel' there can be no 'waiver', the connection between 'estoppel' and 'waiver' being very close. But, in spite of that, there is an essential difference between the two and that is whereas estoppel is a rule of evidence, waiver is a rule of conduct. Waiver has reference to man's conduct, while estoppel refers to the consequences of that conduct."
26. A few decisions of this Court which have illuminatingly dealt with the concept of estoppel may be noted.
27. In S. Shanmugam Pillai v. K. Shanmugam Pillai [(1973) 2 SCC 312 : AIR 1972 SC 2069] it was observed that there are three classes of estoppels that may arise for consideration in dealing with the reversioner's challenge to a widow's alienation. They are : (1) that which is
- 51 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 embodied in Section 115 of the Evidence Act, (2) election in the strict sense of the term whereby the person electing takes a benefit under the transaction, and (3) ratification i.e. agreeing to abide by the transaction. A presumptive reversioner coming under any one of the aforesaid categories is precluded from questioning the transaction, when succession opens and when he becomes the actual reversioner. But if the presumptive reversioner is a minor at the time he has taken a benefit under the transaction, the principle of estoppel will be controlled by another rule governing the law of minors. If after attaining majority he ratifies the transaction and accepts the benefit thereunder, there cannot be any difference in the application of the principle of election. The effect would be the same. It may be, that on attaining majority he has the option to disown the transaction and disgorge the benefit or to accept it and adopt it as his own. Whether after attaining majority the quondam minor accepted the benefit or disowned it, is a question to be decided on the facts of each case.
28. In Provash Chandra Dalui v. Biswanath Banerjee [1989 Supp (1) SCC 487 : AIR 1989 SC 1834] it was observed as follows : (SCC pp. 498- 99, para 24) "24. The essential element of waiver is that there must be a voluntary and intentional relinquishment of a known right or such conduct as warrants the inference of the relinquishment of such right. It means the forsaking the assertion of a right at the proper opportunity. The first respondent filed suit at the proper opportunity after the land was transferred to him, and no covenant to treat the appellants as thika tenants could be shown to have run with the land. Waiver is distinct from estoppel in that in waiver the essential element is actual intent to abandon or surrender right, while in estoppel such intent is immaterial. The necessary condition is the detriment of the other party by the conduct of the one estopped. An estoppel may result though the party estopped did not intend to
- 52 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 lose any existing right. Thus voluntary choice is the essence of waiver for which there must have existed an opportunity for a choice between the relinquishment and the conferment of the right in question. Nothing of the kind could be proved in this case to estop the first respondent."
29. In Indira Bai v. Nand Kishore [(1990) 4 SCC 668] it was observed as follows : (SCC p. 670, para 3) "3. Estoppel is a rule of equity flowing out of fairness striking on behaviour deficient in good faith. It operates as a check on spurious conduct by preventing the inducer from taking advantage and assailing forfeiture already accomplished. It is invoked and applied to aid the law in administration of justice. But for it great many injustice may have been perpetrated. Present case is a glaring example of it. True no notice was given by the seller but the trial court and the appellate court concurred that the pre-emptor not only came to know of the sale immediately but he assisted the appellant purchaser in raising construction which went on for five months. Having thus persuaded, rather misled, the purchaser by his own conduct that he acquiesced in his ownership he somersaulted to grab the property with constructions by staking his own claim and attempting to unsettle the legal effect of his own conduct by taking recourse to law. To curb and control such unwarranted conduct the courts have extended the broad and paramount considerations of equity, to transactions and assurances, express or implied to avoid injustice."
30. If a man either by words or by conduct has intimated that he consents to an act which has been done and that he will not offer any opposition to it, although it could not have been lawfully done without his consent, and he thereby induces others to do that which they otherwise might have abstained from, he cannot question the legality of the act he had sanctioned to the prejudice of those who have so given faith to his words or to the fair inference to be drawn from his conduct.
31. It cannot be doubted that there may be cases in which there is deception by omission, silence may
- 53 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 be treated as deception only where there is a duty to speak; in other words as Bigelow points out in his book Bigelow on Fraud (Vol. 1, at p. 597), ground of liability arises wherever and only where silence can be considered as having an active property that of misleading.
32. In view of the factual conclusions arrived at by the High Court, which are perfectly in order, the appeals are bound to fail. The rule of estoppel has clear application, and in view of this finding it is not necessary to go into the question whether Explanation 6 of Section 11 CPC has any application or not.
In the case of Galada Power & Telecommunication Ltd. Vs. United India Insurance Co. Ltd. (2016) 14 SCC 161, it was held as under:
14. In this context, we may with profit, reproduce a passage from Halsbury's Laws of England, Vol. 16(2), 4th Edn., Para 907, which reads as follows:
"The expression "waiver" may, in law, bear different meanings. The primary meaning has been said to be the abandonment of a right in such a way that the other party is entitled to plead the abandonment by way of confession and avoidance if the right is thereafter asserted, and is either express or implied from conduct. It may arise from a party making an election, for example, whether or not to exercise a contractual right ... Waiver may also be by virtue of equitable or promissory estoppel; unlike waiver arising from an election, no question arises of any particular knowledge on the part of the person making the representation, and the estoppel may be suspensory only ... Where the waiver is not express, it may be implied from conduct which is inconsistent with the continuance of the right, without the need for writing or for consideration moving from, or detriment to, the party who benefits by the waiver, but mere acts of indulgence will not amount to
- 54 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 waiver; nor may a party benefit from the waiver unless he has altered his position in reliance on it."
18. In the instant case, the insurer was in custody of the policy. It had prescribed the clause relating to duration. It was very much aware about the stipulation made in Clauses 5(3) to 5(5), but despite the stipulations therein, it appointed a surveyor. Additionally, as has been stated earlier, in the letter of repudiation, it only stated that the claim lodged by the insured was not falling under the purview of transit loss. Thus, by positive action, the insurer has waived its right to advance the plea that the claim was not entertainable because conditions enumerated in duration clause were not satisfied. In our considered opinion, the National Commission could not have placed reliance on the said terms to come to the conclusion that there was no policy cover in existence and that the risks stood not covered after delivery of goods to the consignee. In the case of UNION OF INDIA & OTHERS VS. N. MURUGESAN & OTHERS, (2022) 2 SCC 25, it is held as under:
22.Two essential factors to be seen are the length of the delay and the nature of acts done during the interval. As stated, it would also involve acquiescence on the part of the party approaching the Court apart from the change in position in the interregnum. Therefore, it would be unjustifiable for a Court of Equity to confer a remedy to a party who knocks its doors when his acts would indicate a waiver of such a right. By his conduct, he has put the other party in a particular position, and therefore, it would be unreasonable to facilitate a challenge before the Court.
Thus, a man responsible for his conduct on equity is not expected to be allowed to avail a remedy.
- 55 -
NC: 2023:KHC:31726 WP No. 11988 of 2020
25.As a consequence, it reintroduces a new implied agreement between the parties. Once such a situation arises, it is not open to the party that acquiesced itself to insist upon the compliance of the original terms. Hence, what is essential, is the conduct of the parties. We only dealt with the distinction involving a mere acquiescence. When acquiescence is followed by delay, it may become laches. Here again, we are inclined to hold that the concept of acquiescence is to be seen on a case-to-case basis.
APPROBATE AND REPROBATE:
26.These phrases are borrowed from the Scott's law. They would only mean that no party can be allowed to accept and reject the same thing, and thus one cannot blow hot and cold. The principle behind the doctrine of election is inbuilt in the concept of approbate and reprobate. Once again, it is a principle of equity coming under the contours of common law. Therefore, he who knows that if he objects to an instrument, he will not get the benefit he wants cannot be allowed to do so while enjoying the fruits. One cannot take advantage of one part while rejecting the rest. A person cannot be allowed to have the benefit of an instrument while questioning the same. Such a party either has to affirm or disaffirm the transaction. This principle has to be applied with more vigour as a common law principle, if such a party actually enjoys the one part fully and on near completion of the said enjoyment, thereafter questions the other part. An element of fair play is inbuilt in this principle. It is also a species of estoppel dealing with the conduct of a party. We have already dealt with the provisions of the Contract Act concerning the conduct of a party, and his presumption of knowledge while confirming an offer through his acceptance unconditionally.
27.We would like to quote the following judgments for better appreciation and understanding of the said principle:
• Nagubai Ammal v. B. Shama Rao, 1956 SCR 451:
"But it is argued by Sri Krishnaswami Ayyangar that as the proceedings in OS. No. 92 of 1938-39 are relied on as
- 56 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 barring the plea that the decree and sale in OS. No. 100 of 1919-20 are not collusive, not on the ground of res judicata or estoppel but on the principle that a person cannot both approbate and reprobate, it is immaterial that the present appellants were not parties thereto, and the decision in Verschures Creameries Ltd. v. Hull and Netherlands Steamship Company Ltd. [(1921) 2 KB 608], and in particular, the observations of Scrutton, LJ, at page 611 were quoted in support of this position. There, the facts were that an agent delivered goods to the customer contrary to the instructions of the principal, who thereafter filed a suit against the purchaser for price of goods and obtained a decree. Not having obtained satisfaction, the principal next filed a suit against the agent for damages on the ground of negligence and breach of duty. It was held that such an action was barred. The ground of the decision is that when on the same facts, a person has the right to claim one of two reliefs and with full knowledge he elects to claim one and obtains it, it is not open to him thereafter to go back on his election and claim the alternative relief. The principle was thus stated by Bankes, L.J.:
"Having elected to treat the delivery to him as an authorised delivery they cannot treat the same act as a misdelivery. To do so would be to approbate and reprobate the same act".
The observations of Scrutton, LJ on which the appellants rely are as follows:
"A plaintiff is not permitted to 'approbate and reprobate'. The phrase is apparently borrowed from the Scotch law, where it is used to express the principle embodied in our doctrine of election -- namely, that no party can accept and reject the same instrument: Ker v. Wauchope [(1819) 1 Bli 1, 21] : Douglas-Menzies v. Umphelby [(1908) AC 224, 232] . The doctrine of election is not however confined to instruments. A person cannot say at one time that a transaction is valid and thereby obtain some advantage, to which he could only be entitled on the footing that it is valid, and then turn round and say it is
- 57 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 void for the purpose of securing some other advantage. That is to approbate and reprobate the transaction".
It is clear from the above observations that the maxim that a person cannot 'approbate and reprobate' is only one application of the doctrine of election, and that its operation must be confined to reliefs claimed in respect of the same transaction and to the persons who are parties thereto. The law is thus stated in Halsbury's Laws of England, Vol. XIII, p. 464, para 512:
"On the principle that a person may not approbate and reprobate, a species of estoppel has arisen which seems to be intermediate between estoppel by record and estoppel in pais, and may conveniently be referred to here. Thus a party cannot, after taking advantage under an order (e.g. payment of costs), be heard to say that it is invalid and ask to set it aside, or to set up to the prejudice of persons who have relied upon it a case inconsistent with that upon which it was founded; nor will he be allowed to go behind an order made in ignorance of the true facts to the prejudice of third parties who have acted on it".
• State of Punjab v. Dhanjit Singh Sandhu, (2014) 15 SCC 144:
"22. The doctrine of "approbate and reprobate" is only a species of estoppel, it implies only to the conduct of parties. As in the case of estoppel it cannot operate against the provisions of a statute. (Vide CIT v. V. MR. P. Firm Muar [CIT v. V. MR. P. Firm Muar, AIR 1965 SC 1216]).
23. It is settled proposition of law that once an order has been passed, it is complied with, accepted by the other party and derived the benefit out of it, he cannot challenge it on any ground.
(Vide Maharashtra SRTC v. Balwant Regular Motor Service [Maharashtra SRTC v. Balwant Regular Motor Service, AIR 1969 SC 329] .) In R.N. Gosain v. Yashpal Dhir [R.N.
- 58 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 Gosain v. Yashpal Dhir, (1992) 4 SCC 683] this Court has observed as under: (SCC pp. 687-88, para 10) "10. Law does not permit a person to both approbate and reprobate. This principle is based on the doctrine of election which postulates that no party can accept and reject the same instrument and that 'a person cannot say at one time that a transaction is valid and thereby obtain some advantage, to which he could only be entitled on the footing that it is valid, and then turn round and say it is void for the purpose of securing some other advantage'."
25. The Supreme Court in Rajasthan State Industrial Development and Investment Corpn. v. Diamond and Gem Development Corpn. Ltd. [Rajasthan State Industrial Development and Investment Corpn. v. Diamond and Gem Development Corpn. Ltd., (2013) 5 SCC 470 : (2013) 3 SCC (Civ) 153] , made an observation that a party cannot be permitted to "blow hot and cold", "fast and loose" or "approbate and reprobate". Where one knowingly accepts the benefits of a contract or conveyance or an order, is estopped to deny the validity or binding effect on him of such contract or conveyance or order. This rule is applied to do equity, however, it must not be applied in a manner as to violate the principles of right and good conscience.
Rajasthan State Industrial Development•26. It is evident that the doctrine of election is based on the rule of estoppel, the principle that one cannot approbate and reprobate is inherent in it. The doctrine of estoppel by election is one among the species of estoppel in pais (or equitable estoppel), which is a rule of equity. By this law, a person may be precluded, by way of his actions, or conduct, or silence when he has to speak, from asserting a right which he would have otherwise had." & Investment Corpn. v. Diamond & Gem Development Corpn. Ltd., (2013) 5 SCC 470:
"I. Approbate and reprobate
15. A party cannot be permitted to "blow hot-blow cold", "fast and loose" or "approbate and reprobate". Where one knowingly accepts the benefits of a contract, or
- 59 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 conveyance, or of an order, he is estopped from denying the validity of, or the binding effect of such contract, or conveyance, or order upon himself. This rule is applied to ensure equity, however, it must not be applied in such a manner so as to violate the principles of what is right and of good conscience. [Vide Nagubai Ammal v. B. Shama Rao [AIR 1956 SC 593] , CIT v. V. MR. P. Firm Muar [AIR 1965 SC 1216] , Ramesh Chandra Sankla v. Vikram Cement [(2008) 14 SCC 58 : (2009) 1 SCC (L&S) 706 :
AIR 2009 SC 713] , Pradeep Oil Corpn. v. MCD [(2011) 5 SCC 270 : (2011) 2 SCC (Civ) 712 : AIR 2011 SC 1869] , Cauvery Coffee Traders v. Hornor Resources (International) Co. Ltd. [(2011) 10 SCC 420 : (2012) 3 SCC (Civ) 685] and V. Chandrasekaran v. Administrative Officer [(2012) 12 SCC 133 : (2013) 2 SCC (Civ) 136 : JT (2012) 9 SC 260] .]
16. Thus, it is evident that the doctrine of election is based on the rule of estoppel--the principle that one cannot approbate and reprobate is inherent in it. The doctrine of estoppel by election is one among the species of estoppel in pais (or equitable estoppel), which is a rule of equity. By this law, a person may be precluded, by way of his actions, or conduct, or silence when it is his duty to speak, from asserting a right which he would have otherwise had."
32. As noted supra, the material on record clearly establishes that the conduct of the respondent No.1 and her husband, Manivannan as evident from the correspondence, resolution of the Society, cancellation of allotment of site No.66, execution of lease-cum-sale agreement in favour of Manivannan in respect of Site No.130 with the tacit consent of respondent No.1 etc., all of which occurred during the
- 60 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 period from the date of their marriage that took place on 16.08.2011 till 04.05.2012 when respondent No.1 initiated the instant proceedings before the JRCS is sufficient to come to the conclusion that the various claims / contentions put forth and urged by respondent No.1 are clearly barred by principles of estoppel, acquiescence, abandonment and waiver and the claim of respondent No.1 is liable to be rejected on this ground also.
33. Insofar as the application I.A. No. 1/2022 filed by the respondent No.1 for permission to produce additional documents in the present petition is concerned, apart from the fact that she did not produce the said additional documents before the JRCS or the KAT, the petitioner has filed its objections disputing and denying the said additional documents. In this context, it is relevant to state that as stated earlier, the Society addressed communications dated 25.11.2011 to respondent No.1 as well as Manivannan calling upon them to choose/ opt for either Site No. 66 or 130 provisionally allotted to them. To the said letter, Manivannan issued a reply dated 05.12.2011 (wrongly
- 61 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 mentioned as 05.11.2011) whereunder he sought for some time from the Society to take a decision. The said reply dated 05.12.2011 was confronted to Manivannan (RW-2) before the JRCS and marked as Ex.R-14 on behalf of the Society.
34. As stated supra, Manivannan (RW-2) was not cross examined by the respondent No.1 before the JRCS nor was Ex.R.14 impeached or challenged by the respondent No.1 who did not even contend that she had sent any reply to the said letter dated 25.11.2011 issued by the Society to her. Despite this, respondent No.1 has sought to produce additional document No.4 along with I.A. No. 1/2022 in order to falsely contend that she had also issued a reply dated 05.11.2011. A bare perusal of the said document No.4 with reference to the other material on record is sufficient to indicate that the said document is a false, concocted and fabricated document which was neither pleaded nor referred to in any of the pleadings or contentions of the respondent No.1 prior to filing I.A. No. 1/2022. It is therefore clear that the respondent No.1 has not come to court with clean hands
- 62 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 and is guilty of abuse of process of law / court and her claim is liable to be rejected.
35. Insofar as documents 1 to 3 produced along with I.A. No. 1/2022, viz., letters dated 14.02.2012, 07.03.2012 and 12.04.2012 said to have been issued by the respondent No.1 to the Society are concerned, the said documents were also not produced by the respondent No.1 during the course of the entire proceedings for more than 10 years; in fact, though the remaining correspondence between the parties were produced and marked during evidence of the Society, there is no cross examination by the respondent No.1 to either RW-1 or RW-2 in relation to the additional documents produced along with IA No. 1/2022. It is also relevant to state that neither valid nor sufficient grounds have been made out by the respondent No.1 in her affidavit in support of the application to enable her to seek the indulgence of this court and to grant permission to produce additional evidence at this highly belated stage. Under these circumstances, I am of the considered opinion that there is no merit in the application and the same is liable to be dismissed.
- 63 -
NC: 2023:KHC:31726 WP No. 11988 of 2020
36. Insofar as the other judgments relied upon by both sides are concerned, the same having been rendered in the facts and circumstances obtaining in the respective cases, the said judgments are distinguishable and are not applicable to the facts of the instant case and as such, the said judgments do not have any bearing on the issues in controversy involved in the present case.
37. In view of the aforesaid facts and circumstances, I am of the view that both the JRCS and the KAT misdirected themselves in allowing the claim of the respondent No.1 and rejecting the claim of the petitioner-Society by passing the impugned orders which are contrary to law as well as the material on record and the same deserve to be set aside.
38. In the result, I pass the following:
ORDER
(i) Petition is hereby allowed;
(ii) Impugned order dated 25.01.2016 passed in Dispute No. IRB/MB/19/2012-13 by respondent No.2-JRCS and impugned order dated 30.09.2019 passed by the Karnataka Appellate Tribunal,
- 64 -
NC: 2023:KHC:31726 WP No. 11988 of 2020 Bengaluru in Appeal No. 43/2016 are hereby set aside;
(iii) Consequently, the claim petition/dispute filed/raised by the respondent No.1 before the JRCS stands dismissed.
Sd/-
JUDGE SRL