Puran and Ors. vs Syed Nazirul Mohsin

D.S.Sinha, J.—Heard Sri A. N. Bhargava, learned counsel appearing for the defendant appellants and Sri S. A. Khan learned counsel appearing for the plaintiff respondent, at length and in detail.

This second appeal under Section 100 of the Code of Civil Procedure 1908 hereinafter called the Code, is directed against the decree and judgment dated 22nd May, 1979 passed by the Civil Judge, Fatehpur in Civil Appeal No 254 of 1978 modifying the decree and judgment dated 25th September, 1978 passed by the VI Munsif Magistrate, Fatehpur in O. S. No. 63 of 1977 between Syed Nazirul Mohsin and Puran and others.

3 Undisputed facts, so far as they are relevant for the purpose of adjudication of the controversy involved in the appeal, are these : By means of a registered agreement dated 21st August, 1975 followed by another unregistered agreement dated 21st July, 1976 Sri Shiv Shankar Lal, defendant appellant No 10 agreed to sell his agricultural land delineated by chak No. 112, situated in village Sadiqabad, pargana Kotla, district Fatehpur in favour of Nazirul Mohsin, the plaintiffrespondent. Later on, by means of the registered saledeed dated 9th November, 1976 he sold the aforesaid land m favour of defendant appellants Nos. 1 to 9. Thu led the plaintiff respondent to institute the suit for specific performance of the two agreements of sale, dated 21st August 1975 and 21st July, 1976 in his favour and for cancellation of the sale deed dated 9th November, 1976 executed in favour of the defendant appellant No. 1 to 9.

By means of the decree and judgment, dated 25th September, 1978 the trial court dismissed the suit. Aggrieved by the decree and judgment of the trial court, the plaintiff respondent preferred an appeal under Section 96 of the Code which was allowed by means of the decree and judgment, dated 22nd May, 1979 impugned herein.

This court has admitted this appeal and formulated the following two substantial questions of law for hearing :

"(i) Whether the agreement in question having entered before the enactment of the Civil Law Amendment was not compulsorily required to be registered and, therefore, there should be no presumption that the respondent knew about it."

(ii) Whether the lower appellate court was right in decreeing a suit for specific performance of an agricultural plot of land, which came to the appellant under consolidation proceedings, whereas the agreement was related to the different plots."

Sri S. A. Khan, learned counsel appearing for the plaintiffrespondent very fairly concedes that the factum of registration of the agreement of sale, which is the subjectmatter of the controversy and which was not required to be registered by law at the relevant time, will not raise the statutory presumption that the defendant appellants Nos. 1 to 9 had notice of the said instrument. Thus, it is not necessary for the court to examine the first question of law formulated by it.

With equal fairness Sri A. N. Bhargava, learned counsel for the appellants, concedes that second question of law calls for no adjudication in view of the fact that there is no dispute about the identity of the land which was agreed to be sold by defendantappellant No. 10 in favour of the plaintiff respondent. The identity of the land is well established by its number, namely. Chafe No. 112

Learned counsel for the appellants, however, contends that the impugned decree and judgment is liable to be set aside as the lower appellate court has illegally raised statutory presumption regarding knowledge of the defendant appellants No. 1 to 9 about the agreement of sale in favour of the plaintiffrespondent.

There is no dispute about the genuineness of the agreement of sale in favour of the plaintiffrespondent. The trial court has found it, as a fact, that agreements were genuine. But it has dismissed the suit of the plaintiff for specific performance of the agreements in his favour and for cancellation of the saledeed in favour of the defendantappellants No. 1 to 9 on the ground that they were bonafide purchasers without notice of the agreements of sale in favour of the plaintiffrespondent,

The lower appellate court has disagreed with the finding of the trial court on the question of defendantappellants No. 1 to 9 being bonafide purchasers without notice of the agreement of sale in favour of the plaintiffrespondent and has found it, as a fact, that defendantappellant No. 1 to 9 were not bonafide purchasers inasmuch as they had notice of the agreements of sale in favour of the plaintiffrespondent.

Sri Bhargava, learned counsel for the appellants, would have been right in assailing the impugned decree and judgment if the lower appellate court had based its finding only on the circumstance of registration of one of the agreements of sale in favour of the plaintiffrespondent which admittedly, was not required to be registered at the relevant time. But a bare perusal of the impugned judgment reveals that the finding of the lower appellate court regarding knowledge of the defendant appellants No. 1 to 9 about the agreements of sale in favour of the plaintiff respondent is not based solely upon the factum and circumstances of the registration of one of the agreements of sale. It is one of the circumstances relied upon, though wrongly. The lower appellate court rested its finding on the following three factors, besides the factor of registration:

(a) proved actual knowledge of the defendantappellants No. 1 to 9 about the agreements of sale in favour of the plaintiffrespondent;

(b) proved failure on the part of the defendantappellants Nos. 2 to 9 to make due enquiry or search which they were expected to make in respect of the title of the land in question before getting the saledeed executed in their favour ; and

(c) proved actual possession of the plaintiffrespondent over the land in question giving rise to presumption of notice of the title of the plaintiffrespondent.

Section 3 of the Transfer of Property Act, 1882, (hereinafter called the Act) states that a person is said to have notice of the fact when he actually knows that fact, or when but for wilful abstention from an enquiry OF search which he ought to have made, or gross negligence, he would have known it. The lower appellate court has rightly pointed out that if the defendant appellants No. 1 to 9 had made enquiry from the Registration Department about the encumberance on the land in question before getting the sale deed executed in their favour they would have surely known about the existence of one of the agreements of sale executed by the defendantappellant No. 10 in favour of the plaintiffrespondent, and that in view of their undisputed failure to make enquiry from the Registration Department they would be deemed to have notice of the said agreement of sale in favour of the plaintiffrespondent as contemplated by Section 3 of the Act.

Besides the finding of failure on the part of the defendant appellants No. 1 to 9 with regard to the due enquiry, the lower appellate court has also found, on due appraisal of the evidence before it, that the defendantappellants No. 1 to 9 actually knew about the existence of agreements of sale in favour of the plaintiff respondent. On this finding the lower appellate court cannot be said to have committed any error, much less an error of law raising any substantial question of law, in arriving at the conclusion that the defendant appellants No. 1 to 9 had notice of the agreements of sale in favour of the plaintiffrespondent.

It has also been found by the lower appellate court that the plaintiff was in actual possession of the land in question. On the basis of this finding it has rightly presumed that the defendant appellants No. 1 to 9 had notice of the title of the plaintiffrespondent. Such a presumption is permissible under the second explanation to the clause defining the expression "a person is said to have notice" contained in Section 3 of the Act. This explanation stipulates that any person acquiring any immovable property or any share or interest in any such property shall be deemed to have notice of the title, if any, of any person who is for the time being in actual possession thereof.

Even if the presumption with regard to the notice of the agreement of sale in favour of the plaintiffrespondent drawn by the lower appellate court on the basis of registration of one of the agreements of sale is excluded, the finding of fact recorded by the lower appellate court that the defendantappellants No. 1 to 9 had notice of the agreements of sale in favour of the plaintiff respondent in respect of the land in question cannot be knocked down as it has the buttress of other proved factors, namely, the actual knowledge of the defendant appellants No. 1 to 9, failure on their part to make due enquiry from the Registration Department regarding encumberance on the land in question before getting saledeed executed in their favour and proved possession of the plaintiffrespondent over the land in question.

The foregoing discussion leads to an irresistible conclusion that the defendantappellants No. 1 to 9 had sufficient notice of the existence of the agreements of sale in favour of the plaintiff respondent. The conclusion of the lower appellate court in this regard is sound, both in law and on facts. The impugned decree and judgment is, therefore, upheld.

In the result, the appeal fails and is hereby dismissed. No costs.