Rajasthan High Court - Jaipur
Mohanlal vs Mishrimal And Ors. on 1 September, 1970
Equivalent citations: 1970WLN575
JUDGMENT C.B. Bhargava, J.
1. This appeal by the plaintiff roises an interesting question about the application of the doctrine of Lis pendens to a sale after the institution of a suit for specific performance by another person in pursuance of an earlies agreement to sell made in his favour & arises from the follwing facts.
2. A plot of land situated in village Rani belonged to Tarachand who is alleged to have entered in to an agreement to sell the said plot on his own behalf & of his 2 minor sons with plaintiff Mohanlal on 16-4-49 for Rs.l500/-out of which Rs. 1000/- were then paid. This agreement to sell was dewed on 4 December' 1951, because the document of sale could not be exec ted in pursuance of the previous agreement. Subsequently Tarachand is say I to have agreed to sell the same plot to Mishrimal respondent on 12-10-1919. Tarachand did non execute any sale-deed in favour of Mishrimal also and so it latter instituted a suit for specific performance of the agreement against Mahanlal on the basis of the agreement dated 12.10.49. The suit for specific performance was instituted on 3-10-53. During the pendency of this suit to which Mohanlal was not made a party. Trachand executed a sale-deed in favour of Mohanlal on its October, 1954, and got it registered. Mishnlal's suit for specific performance was decreed against. Tarachand and in execution of the decree he was resisted in delivery of possession by Mohanlal. Thereupon Mishrimal made an application under Order 21 Rule. 97 CP C. to the executing court for the removal of the obstruction. Notice was given to Mohanlal and he submitted his reply that he was the true owner of the disputed plot on the basis of the sale-deed executed by. Tarachand in his favour. The executing court found that Mohanlal was a representative of the judgment-debtor because he had purchased the property during the pendency of the suit for specific performance and as such dismissed the objection and possession was delivered to Mishrilal. Mohanlal again made an application for restoring possession of the property to him on the ground that he had purchased the property in pursuance of prior agreement and that the decree-holder was not entitled to take possession of the house which he had built on the plot after the sale in his favour. This objection was also dismissed by the executing court Mohanlal then instituted the present suit for recovery of possession of the house and plot and in the alternative for Rs. 11500/- for the cost of the building and Rs. 1500/- for the price of the plot. Tarachand was also impleaded as a party to the suit and a prayer for recovery of the amount paid to him and the cost of the building was also made against him.
3. Separate written statements were filed on behalf of defendant No. 1, the vendee and defendant Nos. 4, 5 and 6, the vendor and his two sons Defendants Nos. 4, 5 and 6 in their written statement admitted the exeexcution of the agreements to sell of the disputed plot of land in favour of the plaintiff on 16-4-49 and 4-12-51, They denied the execution of such agreement in favour of defendant No. 1 However, they admitted that defendant No. I had obtained a decree for specific performance against them on 23.12.55.
4. Defendant No. 1 in his written statement denied the existence of prior agreements to sell executed by defendant No. 4 in favour of the plaintiff It was stated that the said agreements were fabricated for the purpose of the suit. It was further stated that the defendant had filed civil suit No. 190 of 1953 on 3. 13.53 against defendants Nos. 4 to 6 for specific performance of his contract of sale dated 12.10.49 and for possession. It was after the institution of the said suit that defendants Nos. 4 to 6 in collusion with the plaintiff and his father and uncle brought about a bogus sale-deed in the name of the plaintiff on or about 1. 10.1964. As soon as the defendant came to know about the execution of this deed, he immediately is and a registered notice to the plaintiff bringing to his notice that his suit for specific performance of the contract for sale was pending in the Pali Court and that if he made any constructions on the land in question, he would do so at his own risk'. This notice was served on the plaintiff on 28th December 1954. The plaintiff however, kept quiet and did not give any reply to the said notice. It was stated that the plaintiff being a transferee during the pendency of the suit was affected by the doctrine of lis pendens and was alto bound by the decree in civil suit No. 190 1943 passed by the Civil Judge Pali on 23rd December, 1955 that the present suit was barred by the principle of res judicata and also under the provisions of Section 47 of the Code of Civil Procedure, that the plaintiff was not entitled to possession of the disputed property or any compensation for the constructions made by him because he had no title to the land and that said constructions were unauthorised.
5. On these pleadings the trial court framed the following issues:
1. Whether Tarachand and his two sons had through Tarachand executed the agreement dated 16.4.49 in favour of the plaintiff for the sale of the disputed plot of land and possession was given to him
2. Whether the agreement dated 16.4.49 was renewed by the agreement dated 4.12.1951.
3. Whether the sale-deed dated 1.10.1954 was executed by Tarachand on behalf of himself and his swo sons?
4. Whether the plaintiff had constructed the super-structure standing on the disputed plot. If so, whether it cost Rs. 11500/-?
5. Whether the sale-deed dated 25.7.1959 executed by Shri Deonarain, Reader, Civil Judge, Pali, and registered on 14.1.1959 by the Registrar Pali is invalid in law?
6. Whether the execution of the decree dated 13.12.1959 was time barred and as such Misrimal and his two sons did not acquire any title to the disputed property and their possession was, therefore, illegal and void as against the plaintiff?
7. Whether the defendant Misrimal and his two sons became the owner of the disputed Land and the super-structure on or about 23 6.6.58?
8. Whether the suit is bad for mis-joinder of causes and defendents?
9. Whether the plaintiff is barred by the principles of resjudica and the provisions under Section 47 C.P.C. to file this suit on account of the judgment in the execution case No. 96 of 1956 of the Civil Judge Pali dated 24.5.1958 as stated in paragraph Nos. 14 to 19 of the amended written statement?
10. Relief.
6. In support of the above issues, plaintiff gave his own statement as P.W. 1, and examined Chhogmal P.W. 3. Manmal P.W. 4, Jawerchand P.W. 6 and Joharmal P.W. 7 Besides two more witnesses Jamandas Moolchand Ratnani and S.P. Mayakar, Advocates of Bombay were examined on commission. In rebuttal Mishrimal gave his own statement as D.W. 1 but inspire of opportunities being given to him, he did not submit himself to complete cross examination and his evidence has therefore, not been considered by the lower court. One more witness Chhoganmal D.W. 2 was examined on behalf of the defendant. Both parties produced documentary evidence in regard to the above issues.
7. The learned District Judge on a consideration of the evidence decided issues Nos. 1 and 2 against the plaintiff holding that the execution of the agreements dated 16.4.49 and 4.12.51 by Tarachand in favour of the plaintiff was not proved. He further held that the execution of the sale-deed by Tarachand on 1.10.54 in favour of the plaintiff was proved. He further found that the plaintiff had raised constructions costing Rs. 11500/-over the disputed plot. The learned Judge further held that the sale-deed dated 1st October, 1954 in favour of the plaintiff was hit by the doctrine of lis pendes and was, therefore, void. That being so, it was further held that the plaintiff was not entitled to any relief against Misrimal. The plaintiff was also not allowed any relief against. Tarachand vendor. The objection regarding the bar of res judicata and under Section 47 C.P.C. was not decided by the learned Judge.
8. In this appeal, learned Counsel for the appellant has raised the following contentions:
(1) that the finding of the lower court regarding the execution of the agreements in favour of the plaintiff by Tarachand dated 16.4.49 and 4.12.51 is not correct; specially in the absence of any andence in rebuttal;
(2) that the sale-deed in favour of the plaintiff date 1st October, 1954, is not hit by the doctrine of list pendens inasmuch as the said deed was executed in recognition of the preexisting and subsisting right of the plaintiff on the basis of the two agreements;
(3) in any event plaintiff was entitled to a decree for the costs of the building which he had erected on the disputed land believing in good faith that he had a good title to the land; and (4) that the learned Dissrict Judge erred in not decreeing the suit against the suit against the vendor.
9. The first point, therefore, to be determined is whether Tarachand had agreed to sell the disputed plot to the plaintiff and had executed the agreements dated 16.4.49 and 4.12.1951 in his favour. On this point, the relevant evidence on behalf of the plaintiff is his own statement and that of Shri S. P. Mayakar and Shri Jamnadas Moolchan Ratnani, Advocates. Mohan lal has deposed that he had purchased the disputed plot of land from Tarachand who in pursuance of his oral agreement which took place at Bombay on 15th April, 1945, had executed an agreement of sale on 16th April, 1949, in his favour, Tarachand had signed Ex. 1 in his pressence. On the same day, he paid Rs.1000/- to Tara chand who delivered the patta of the land to him. Thereafter this agreement was renewed on 4.12.1951 & he executed Ex 2. Ex. 2 also was signed by Tarachand in his presence. Thereafter the plot was sold to him on 1st October, 1954. He had started making constructions over the plot in October, 1954, and had spent about Rs.11500/- for the constructions and that until 1st October, 1954, he had no knowledge of the agreement dated 12.10.1949 alleged to have been executed by Tarachand in favour of Misrimal for the same plot.
10. In cross-examination, Mohanlal has stated thai on 15th April, 1949, Tarachad had come to Bombay for his own business. He had paid Rs. 1000/- to Tarachand at 2 P.M. on 16th April, 1949, and the agreement, Ex 1 was executed in the office of Shri S. P. Mayakar at 6 P.M. He stated that he had told one Mohan Sewag that he wanted to purchase some land on which he informed Tarachand and that is why the latter had come to him for selling ths disputed plot. He has further stated that at the time of the execution of Ex 1, both he and Tarachand thought that the salt-deed would be registered within six months, but he had Tarachand had no occasion to come together to Rani Gaon between 16th April, 1949 and 1st October, 1954. He had withheld payment of Rs . 500/- to Tarachand for it was intended to be paid after the registration of the sale-deed Neither he nor Tarachand after the execution of the agreement dated 16th April, 1949, gave notice to each other for registration of the sale-deed. He has stated that at the time of the registration of the sale-dee on 1st October, 1951, agreements Exs. 1 and 2 were not with him at Rani. Gaon as they had been left at Bombay. He had told his lawyer Shri Manakmal about both the agreements but he did not think it necessary to make a mention of them in the sale-deed. He admitted that Shri Moolchand Daga was his vakil in execution proceedings No.96 of 1956. He also admitted that he had received Misrimal's notice dated 20th December, 1954, but he was unable to trace it out. He has stated that his lawyer did not think it necessary to produce the agreements in the execution proceedings although he had mentioned them to him. He has stated that Shri S. P. Mayakar was his counsel for the last 15 years and that it was wrong to say that he colluded with Shri Mayakar and fabricated Exs. land 2. He had paid Rs. 25/-to Shri Mayakar as his fee for preparing the agreements.
11. Shri S.P. Mayakar has stated on seeing the agreements Exs. 1 and 2 that they were prepared by him. The stamp paper was also in his name and the agreements bear his attestation. The seller and the purchaser had also singed the agreements in his presence. He has further stated that Mohanlal plaintiff had come to him on 16th April 1949, either in the morning or in the noon and gave him instructions to prepare these documents. He admits that he did not maintain any instruction-book and has also not noted the fee he received anywhere nor is the work noted down in his diary because he did not maintain any diary except the desk calendar. He admits that he did not pay any income-tax. He stated that Ex. C was executed in his office between the hours of 6 to 7 P.M. but the amount of Rs. 1000/-was not paid in his presence although the seller had admitted the receipt of Rs. 1000/- and so he attested the receipt portion of the agreement. The second agreement was a sort of renewal of the previous agreement because the conveyance was not executed. He denied the suggestion that both agreements were made in the later part of 1953. He has stated that unless specifically instructed, he generally purchased agreement stamp papers in his own name. The witness is an advocate of Bombay High Court practising in Bombay Courts for the last 27 years.
12. The third witness is Shri Jamanadas Moolchand Ratnani who is also an advocate of the Bombay High Court practising in the Bombay Courts for the last 18 years. On seeing a typed copy of letter dated 7th February, 1955, Ex. A, the witness stated that this letter was issued by him to the addressee Shri Mishrimal Gulabchand Ranka. He further stated that Ex. B. certificate of posting, related to letter Ex. A and another letter issued from his office. In cross-examination, the witness was asked to identify the plaintiff and to say if Ex A I was issued upon his instructions. The witness replied that at that length of time he could not identify Mohanlal plaintiff. He stated that from rubber stamp on Ex. A and from Ex B it appeared that Ex- A had been issued from his office. He stated that Ex. B emanated from his office because the hand-writing thereon wis of his managing clerk who was also his brother. He was asked in re-examination as to why he was not able to identify the plaintiff and he replied that he was not his permanent client, and that long time and elapsed and every day he had to handle large correspondence and therefore he could not identify him. It would be pertinent to note here that in Ex. A which is in reply to the defendant's letters dated 20th December, 1954, and 31st January, 1955, there is a mention of the two agreements dated 16th April, 1949, and 4th December, 1951. In para 2 of Ex. A, it is stated that:
The true facts of the case are that my client agreed to purchase the said plot from Tarachand Umedmal on 16-4-49 for total consideration of Rs. 1500/- & Rs. 1000/- had beep paid on the said day i.e., 16-4-49 and the terms of purchase were agreed in writing as per the agreement dated 16-4-49 executed between my cleint and said Tarachand. My cleint was given possession. Later as the said need could hot be executed and got registered at Desuri, said Tarachand and my cleint again entered into agreement dated 4-12-51. to complete the sale and in . consequence of the said agreements the sale was completed and the sale dated registered at Desurition or about 1-10-54
13. No evidence in rebuttal was given on behalf of the defendant. Even the agreement dated 12-10-49 said to have been executed by Tara Chand in his favour was not produced in this case
14. The learned District Judge did not consider the evidence of Shri Jamnadas Moolchand Ratnani & the two documents Exs A&B proved by him & this fact by itself vitiates the finding of the learned District Judge in regard to the execution of Exs. 1 and 2 by Tarachand in plaintiff's favour. The learned District Judge did hot find the execution of the two agreements proved because in the sale-deed there was no mention of the agreements and the payment of Rs. 1000/- to the vondor and handing over of the patta of the land to the vendee and further that the plaintiff did not make any mention of the said agreements in the reply which he had submitted on 1st May, 1956 on the application of the decree-holder under Order 21 Rule 97 C.P.C. These omissions in opinion of the learned Judge were verp signifiscant and the explanation given by the plaintiff that at the time of preparing the reply in the execution proceedings he had shown the agreements to his counsel but he did not think it necessary to mention them was not satisfactory. Besides, it was not believable that the plaintiff who was a petty trader would have allowed the amount of Rs.1000/-to be locked up for such a long period and he did not even call upon the vendor to execute the sale-deed in his favour. Shri S. P. Mayakar's evidence was not believed because he had a very modest practice and he did not maintain any instructions-book or any diary or account-book in which fees received by him for preparing the agreement would have been entered. Shri Mayakar also did not pay any income-tax, and therefore, his evidence, having regard to all the circumstances of the case, could not be believed, Further, the learned Judge observed that it had not been satisfactorily explained why Tarachand visited Bombay on 16th April, 1949, when he was not doing any business there nor was he a resident of Bombay.
15. It is true that there is no mention of these agreements in the sale-deed nor does the sale-deed contain any recital about the receipt of Rs. 1000/- by the vendor from the vendee, It is also true that in the reply filed by the plaintiff to the defendant's application under Order 21 Rule 97, there is no mention of these agreements. But it is to be remembered that sale-deed dated 1st October, 1954, was not prepared by any expert draftsman but was done by some clerk working in Muffassil Tehsil. The plaintiff has explained that the two agreement were not with him when the sale-deed was executed but had been left at Bombay and that might be the reason why the sale-deed makes no mention of the previous agreements, or it might be that the scribe of the sale-deed might not have attached any importance to the previous agreements when a completed sale was being effected between the parties. As regards the omission to mention the agreements in the reply during execution proceedings, it would appear that there the plaintiff only pointed out that he had purchased one plot of land from Tarachand openly and after it had raised censtructions costing about 10,000/- rupee's over it and that he was in its possession in his own right. It is a brief reply and probably, as explained by the plaintiff, his counsel might not have thought it necessary to give all the details of the previous agreements in it. However, when the plaintiff submitted another application to the executing court for restoration of possession of the disputed plot, he refuted the suggestion that he had purchased the plot during the pendency of Misrimal's suit against Tarachand. It was clearly averred that Tarachand had already agreed to sell the suit land to the plaintiff on 16th April, 1949 and 4th December, 1951. This fact would be clear from the copy of the order of the Civil Judge Pali dated 23rd September, 1958, Ex A-15. Moreover, omission to mention these agreements of the sale by the plaintiff in his reply to Misrimal's application under Order 21 Rule 97 loses all its force when it is found that he had mentioned it in his reply Ex. A.
16. Ex. A is fully proved by the evidence of Shri Ratnani Advocate of of Bombay. His evidence appears to be quite straight forward and true because he did not profess to identify even the plaintiff due to lapse of time. It is also proved by his evidence that the original of Ex. A was sent by post to the defendant under certificate of posting. Thus if the agreements dated 16.4.49 and 4.12.51 were relied upon by the plaintif as early as 7.2.55, it is of no consequence if he did not mention them in his reply Ex. A-12 dated 22.9.1956 I also do not agree with the finding and the reasons thereof that Shri Mayakea's evidence was not believable. It may be that Shri Mayakar was not a doyen of the bar and had only a modest practice but the affluence of a person is not the sole test of his crediblity which by and large depends on his education and calling. It is difficult to see why a lawyer who has a modest practice at the bar should not be regarded as worthy of credit Evidence of each witness has to be weighed on its own merits and considered in the light of other circumstances in the case. The court is justified in regarding a witness as incredible when there are inherent improbabilites in his evidence. Learned-District Judge has observed that Shri Mayakar did not maintain any instruction book, diary regarding work, account book regarding the fees received by him for drafting the agreements and also does not pay income-tax. That may be so. But many lawyers do not keep such records and yet their inte grity remains beyond doubt. However, Shri Mayakar's evidence finds corroboration from the statement of Shri Ratnani whose evidence, as already said, is quite straight-forward and believable. Plaintiff had also produced Ex. A and But the early stage of the case. It was urged by the respondent's counsel that the plaintiff himself did not say that he had instructed Shri Ratnani to write out Ex. A and Shri Ratnani has also failed to identify the plaintiff during his examination. Therefore there is no proof that Ex. A was written at the instance of the plaintiff It is correct that no question was put to the plaintiff about Ex. A, but the reason seems to be as pointed out by the appellant's counsel that Ex. A was not on the court is file when plaintiff was examined because it had been already sent to the Commissioner for the evidence of Shri Ratnani. However, having regard to the contents of Ex. A, it is clear that it must have been sent at the instance of the plaintiff and none else. The stamps for the agreements had also been purchased by ShriMayakar on the date they had been executed Learned Districtjudge has remarked that the plaintiff is not a man of means & he could ill afford to have a sum of Rs. 1000/- locked up for an indefinite period of time &did not even give notice to Tarachand to execute the sale-deen when he had failed to do it within 4 to 6 months as envisaged by the parties at the time of the first agreement.
17. However, I have not been albe to find from the statement of the plaintiff that he could not even afford to spare Rs. 1000/- for a few years. He was making and selling gold ornaments is Bombay and must have been in a position to easily spare Rs. 1000/-. He has also explained why sale-deed could not be executed by Tarachand within 4 to 6 months. There was no question of distrust between the parties and therefore no notice was required to be given to Tarachand. Sale-deed was to be registered at Tehsil Desuri and both parties did not have occasion to visit that place together and that is why the agreement was renewed in December, 1951 and sale-deed was executed in October, 1954. Tarachand was also carrying business at Poona and there is nothing strange if the two agreements were executed in Bombay. Bombay is not far away from Poona and so Tarachand's presence in Bombay on the dates the agreement were executed cannot be regarded as a suspicious circumstance.
18. In my view from the statement of Mohanlal plaintiff, Shri Mayakar Advocate and Shri Jamanadas Moolcahnd Ratnani execution of the agreements to sell and on 16.4.1949 (Ex.1) and 4.12.51 (Ex.2) by Tarachand is well established and accordingly issues Nos. 1 and 2 are decided in favour of of the plaintiff appellant.
19. The next and the important point for consideration is whether the sale in favour of the appellant on 1.10.54 in pursuance of thee prior agreements dated 16.4.49 and 4.12.51 is hit by the doctrine of lis pendens. Section 52 of the Transfer of Property Act reads as follows:
52. During the pendency id any court having authority within the limits of India excluding the State of Jammu and Kashmir or established beyond such limits by the Central Government of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein, except under the authority of the Court and on such terms as it may impose.
This section enacts the doctrine of lis pendens which is expressed in the maxim 'Ut lite pendente nihil innovetur'. The rule as stated in the leading English case Bellamy v.Sabine 44 E.R. 842 on the subject in the words of Lord Cranworth is:
where a litigation is pending between a plaintiff and a defendant as to the right to a particular estate the neceessities of mankind require that the decision of the Court in the suit shall be binding, not only on the litigant parties, but also on those who derive title under them by alienations made pending the suit, whether such alienee had or had not notice of the pending proceedings. If this were not so, there could be no certainty that the litigation would ever come to an end.
The legal effect of the doctrine is that the transactions pendente lite are not to be allowed to effect the right under the decree. However, it does not operate so as to decree. However, it does not operate so as to defeat any right existing before the date of the suit. The appellant contends that a prior contractee for sale of immovable property has a right to purchase it in preference to a subsequent contractee who is enforcing his right by commencement of a suit against the common contractor. It is pointed out that a prior contractee can successfully defeat the claim of a subsequent contractee if he is impleaded a party in the same suit or by a separate suit. He would therefore be not put in a worse position if instead of enforcing his right by means of a suit he purchases the property by a private sale, although after the commencement of the suit by the subsequent contractee. It would otherwise lead to very inequitable results and an unscrupulous vendor would get a handle to defeat the the claim of previous contractee by entering into a subsequent agreement and getting a suit instituted against him by the subsequent contractee. For the above contention, strong reliance is placed on the following observation in Bishan Singh v. Khazan Singh :
The doctrine of lis pendens applies only to a transfer pendente lite, but it cannot affect a pre-existing right. If the sale is a transfer in recognition of a pre-existing and subsisting right, it would not be affected by the doctrine, as the said transfer did not create new right pendente lite; but if the pre-existing right became unenforceable by reason of the fact of limitation or otherwise, the transfer, though ostensibly made in recognition of such a right, in fact created only a new right pendente lite.
It is argued that though the above observations were made in a suit for preemption and their Lordships only summarized the settled law of the Punjab in the aforesaid observations, the same principle can equally be applied in the case of agreements of sale because a prior contractee and a pre-emptor having an equal or a superior right stand on the same footing.
20. It is pointed out that though a contract for sale of immovable property not create interest in immovable property having regard to the terms of Section 54 of the Transfer of Property Act, it creates an obligation attached to the ownership of property. Reliance is placed on Shib Lal v. Bhagwan Das ILR 11 All. 244 Ram Baran v. Ram Mohit , Varughese v. Lonan AIR 1952 TC 467 and Athinarayan v. Subramania AIR 1942 Mad. 67. Learned Counsel has also referred to Narayan Prasad v. Rajkishore AIR 1951 Pat. 613 In that case A agreed to grant a lease to B of a cinema theatre at a future date provided B made the necessary repairs to make it fit for purpose of cinema shows within a period of nine months. B entered into possession under the agreement to make the repairs. G who had notice of this contract took a lease from A of the theatre within the period of 9 months mentioned in the agreement between A and B. On A's failure to give possession Cosued A for specific performance and obtained a decree. During the the pendencey of this suit, A executed a registered lease in favour of B in pursuance of the prior agreement. B then brought a suit against B for injunction restraining him from executing the decree against him. It was held that.
B" s rights under the agreement remained unaffected by the subsequent execution of lease in C's favour. Hence the lease executed in B's favour in pursuance of the agreement was not hit by the doctrine of lis pendens.
It was further held that It B had been impleaded in C's suit for specific performance B could have been able to interpose the shield of Section 53A, T.P. Act The fact that while standing this position B took a lease from A could not make his position worse than it was. B having petained the possession of the property was entitled to rely on it in resisting the execution of decree obtained by C.
21. On behalf of the respondent, it is urged that an agreement of sale does not of itself create any interest in or charge on such property and hence execution of sale-dee J on the basis of a prior agreement of sale during the pendency of a suit for specific performance on the basis of subsequent agreement of sale is hit by the doctrine of Use pendens. It is urged that the observations of the Supreme Court in Bishan Singh N. Khazen Singh (Supra) are confined to the case of pre-emption only. Reliance is placed on Munnilal v. Bhaiyalat ATR 1962 MP 34 and Khaja Bi v. Mohammed Hussain AIR 1964 Mys. 269 (F.B.).
22. In the first case, their Lordships of the Madhyy Pradesh High Court distinguished both the decisions in Narayan Prasad v. Rajkishore (supra). In regard to the observations of the Supreme Court quoted above it was stated:
In our opinion, the ex-pression preexisting and subsisting right was intended by their Lordships to refer to a transaction amounting to a transfer of interest in property and not to a mere agreement to sell.
With utmost respect, I may say that the observations of their Lordship of the supreme Court in Bishan Singh's case (supra) cannot be given such a restricted meaning so as to limit it to transactions amounting to a transfer of interest in property. The said observations were made in regard to the right of a pre-emptor having an equal or a superior right and the right of pre-emption is also not a right in the property. The right of a pre-emptor and that prior contractee on the basis of a contract for sale are both lnchoate rights enforoea-ble by legal action and equally capable of defeating the claim of a rival pre-emptor and subsequent contractee for sale.
23. In the decision of the Lahore High Court in Sant Kaur v. Teja singh AIR 1946 Lah. 142 (FB) which was approved by the Supreme Court in Bishan Singh v. Khazan Singh (supra), the following passage may be cited with advantage:
The reason for not applying the rule of lis pendens to the case of a subsequent transferee who himself had a right of pre-emption either equal or superior to that of the plaintiff is that if he had brought a suit to enforce his pre-emption right, even though subsequent to the institution of the suit by the plaintiff, his right to get a decree and to acquire the property on due compliance with the terms of the decree could not be affected by the fact of the plaintiff having instituted his suit earlier, and there is no reason why he should be placed in a worse position if without the necessity of a suit the original vendee is prepared to admit his claim and to agree to his substitution for himself in the original bat gain. Where the subsequent vendee has still the means of coercing, by means of legal action, the original vendee into surrendering the bargain in his favour a surrender as a result of a private treaty and out of Court, in reconition of the right to compel such surrender by means of a suit cannot properly be regarded as a voluntary transfer so as to attract the application of the rule of lis pendens. The correct way to look at the matter, in a case of this kind, is to regard the subsequent transferee as having simply been substituted for the vendee in the origional bargain of sale. He can defend the suit on all the pleas which he could have taken had the sale been initially in his own favour.
These observations are equally applicable to a prior contractee for sale.
24. Learned Counsel for the respondent referred Mohammed Saddiq v. Ghasi Ram AIR 1946 Lah. 322 to show that the doctrine of lis pendens applies to the case of prior contractee for sale. In this case the facts were that on 21st August, 1941 one Mt. Khatum had purchased a house from Zamir Ahmad. The sale deed was registered on 23rd August, 1941. On 25th August. 1941 one Mohammed Saddiq served a notice on Mst. Khatum that he had a right of pre-emption in respect of the sale made by her in favour of Zamir Ahmad. As a notice, Mst Khatum executed an agreement of sale in favour of Mohammed Saddiq to sell the property to him. On 22nd August, 1942, Ghasi Ram instituted a suit for pre-emptin in respect of sale of 21st August, 1941. During the pendency of this suit, Mst. Khatum executed a sale-deed in favour of Mohammed Saddiq in pursuance of the agreement to sell, dated 22nd September, 1941. Mohammed Saddiq was made a party in the suit for pre-emption and he pleaded that he had a house contiguous to the house sold and Ghasi Ram had no right to acquire the property in preference to him. This plea was not accepted because he could not be deemed to have enforced his right of preemption by merely securing an agreement for sale from Mst. Khatum. The court observed.
However, the whole transaction fell far short of an actual exercise of enforcement of the pre-emptive right. A right of preemption can be said to have been effectively exercised of enforced only when the pre-emption has become actually substituted for the vendee in the origional bargain of sale. Till such substitution takes place the vendee remains the owner of the property purchased by him and the prospective pre-emptor cannot claim to have any right to or in the subject-matter of the sale. Where the pre-emptive right is sought to be enforced by means of a suit, such substitution takes place, and the preemptive right is deemed to have been exercised or enforced, only when the price has been paid by the preemptor info Court in compliance with the decree passed in his favour. Till such payment has been made, the act of the pre-emptor in instituting the suit for pre-emption amounts to no more than a mere assertion of the right, which becomes a successful assertion of the right when the suit culminantes in a decree. There is however a vast difference between a mere assertion, albeit a successful assertion, of the pre-emptive fight and the exercise or enforcement of that right.
It would be seen that in this case the competition was not between two preemptors because Mohd Saddiq was not enforcing his preferential right to the property as a preemptor because that right had become un-enforceable by lapse of time on the date of the sale-deed in his favour, but on the basis of a sale in pursuance of an agreement to sell which he had obtained in recognition of his right of pre-emption from the first vendee, The competition therefore was between a pre-emptor and a transferee from a vendee during the pendency of the suit for pre-emption. This case is, therefore, no authority for the proposition that a sale on the basis of a prior contract for sale is hit by the doctrine of lis pendens.
25. In Khaja Bi v. Mohammed Hussain (supra), their Lordships also referred to Mohammed Saddiq v. Ghasi Ram (supra) which as already stated, is quite disting dishable. In regard to the observations of the Supreme Court in Bishan Singh v. Khazan Singh (supra) it was observed that:
the expression' pre-existing right' in the above extract was not intended by their Lordships to apply to all types of rights but only to the right of a pre-emptor in Punjab which has not become barred by limitation, the under-lying principle being that a surrender to such a pre-emptor in recognition of his rights is not a transfer at all but a mere substitution of one purchased by another.
with utmost respect I may say that the retio of the decision in Bishan Singh v. Khazan Singh is not that the doctrine of lis pendens does not aply in the case of pre-emption because it is not a transfer but a mere substitution of one purchaser by another; but the emphasis is no the pre-existing right. In whose recognition the transfer takes place during the pendency of the suit A sale effected by the eendee during the pendency of the pre-emption suit to a person having an equal or a superior right of pre-emption is no doubt a transfer of property as defined in Section 5, Transfer of Property Act. Moreover, the doctrine of lis pendens applies not only to transfers of immovable properly but to other transactions on will which amount to dealing with the property such as cnntract for sale, compromise, partition, surrender etc.
26. I, therefore, find myself unable to follow the above two decisions relied on on behalf of the respondent. In my view the doctrine of lis pendens does not apply to transfers and other transactions dealing with the property in snit which are made in recognition of pre-existing and subsisting right which is enforceable by legal action though it may not create interest in the property.
27. In the present case too, the appellant on the basis of the prior contract of sale made in his favour by Tarachand could have successfully defeated the respondent's suit for specific performance if he had been a party to that suit or would have filed a separate suit, If he could coerce the respondent to surrender the bargain in his favaur by legal action, he can equally do so by getting a sale-deed by private arrangement with the vandor and the doctrine of lis pendens would not apply in either case. Point No. 2 is, therefore, decided in favour of the appellant and it is held that the sale of disputed plot in his favour on 1st October, 1954. is not hit by the doctrine of lis pendens. The decree for specific performance of contract for sale obtained by defendants Nos. 1 to 3 against defendants Nos. 4 to 6 is not binding upon the plaintiff and possession of disputed property obtained under that decree is not legal.
28. In view of findings on points No. 1 and 2 in fovour of the appellant, it is not necessary to discuss points Nos. 3 and 4.
29. Learned Counsel for the respondent had also urged that the present suit is barred by Section 47 C.P.C. inasmuch as the plaintiff is a repesentative of the judgment-debtor and is bound by the decree passed in the suit for spefic performance against him. Reliance was placed on Parmeshari Din v. Ram Charan AIR 1937 PC 260, Sant Kaur v. Teja Singh (supra), Subba Rao v. Venkataseshacharlu AIR 1949 Mad 207 and warayan Rao v. Chunnilal AIR 1953 Nag. 236. But in view of the court's finding on point No. 2, this point does not arise in the present case.
30. As a result of these findings, this oppeal is allowed, judgment and decree of the lower court are set aside and the plaintiff's suit for declaration of title and possession of the property in dispute including the superstructures is decreed with costs of both the courts.