Whether Court can hold that deft was bonafide purchaser for value without notice even though there was no pleading to that effect?

IN THE HIGH COURT OF BOMBAY AT GOA

Second Appeal No. 29 of 2004

Decided On: 12.03.2012

Appellants: Jayant Madhukar Padbidri
Vs.
Respondent: Sarvottam Narcinva Kamat

Hon'ble Judges/Coram:
F.M. Reis, J.

Civil - Bonafide Purchaser - Whether, District Court was right in holding that Respondent was bonafide purchaser for value without notice - Held, it was found that in written statements filed by Respondent no particulars had been given by Respondent to that effect that Respondent had purchased suit plot without prior notice of earlier Sale Deed and as bonafide purchaser - However when person was seeking defence on that count, it was incumbent upon him to lay foundation to that effect in pleadings - When no such pleadings were found in written statement of Respondent, Lower Appellate Court was not justified to come to conclusion that Respondent was bonafide purchaser - Appeal allowed. 

1. Heard Shri R. G. Ramani, learned Counsel appearing for the Appellant and Shri M. B. D' Costa, learned Senior Counsel appearing for the Respondent. The above Appeal challenges the Judgment passed by the Lower Appellate Court whereby the Appeal preferred by the Respondent was allowed and SA-29-04 the Judgment passed by the learned Civil Judge, Junior Division at Ponda, in Regular Civil Suit no. 100/1993 came to be set aside.

2. The above Appeal was admitted by this Court by Order dated 08.04.2004, on the following substantial questions of law :

(a) Whether, when the suit plot was already sold by its vendor to the appellant by a sale deed dt. 26.8.1976 duly registered on 28.10.1976 and the said Vendor thereafter had no right, title, interest or authority to transfer the suit plot to the respondent, the learned IInd Addl. District Court was right in holding that the sale deed dt. 29.10.1980 executed by the same vendor in respect of the suit plot in favour of the respondent was legally valid and thereby title vested in the respondent merely because the appellant had not prayed for declaration of sale deed dt. 29.10.1980 as null and void ?

(b) Whether, when the appellant's suit was basically a suit for possession based on title governed by Art. 65 of the Limitation Act, 1963, the learned IInd Addl. District Court was justified in not considering the said relief to the appellant and in allowing the respondent's appeal despite finding that the appellant's prayer for possession was not time barred ?

(c) Whether the District Court was right in holding SA-29-04 that the respondent was bonafide purchaser for value without notice and without there being such a plea in the pleadings is a substantial question of law ?

3. A suit came to be filed by the Appellants for a permanent injunction, mandatory injunction and for restoration of possession in respect of the property purchased by the Appellant pursuant to a Sale Deed dated 26.08.1976 which was registered before the Sub-Registrar of Ponda, with regard to a plot admeasuring an area of 447 square metres being plot no.12 of the property known as "Sanquela Batta" situated in Ponda, registered under no. 6347 of Book B-17, new series and surveyed in the then cadastral survey under no. 5 (old) and with specific boundaries mentioned at para 3 of the plaint. It was the case of the Appellant in the plaint that after purchasing the said plot of land, the Appellant was in possession of the suit property and that they visited the property on 05.07.1993 when, according to the Appellant, they found an illegal structure which was put up on the southern side of the property encroaching an area of 100 square metres in the suit plot. Consequently, for the reasons stated in the plaint, the Appellant filed the suit praying, inter alia, for a mandatory injunction directing the Respondent to remove the said illegal structure of 10 by 10 metres located on the southern side besides for a permanent injunction restraining the Respondents from in any manner interfering with the suit plot and also for a permanent injunction from renovating/modifying/re-constructing or extending the suit structure.

4. The Respondents filed their written statement disputing the claim put SA-29-04 forward by the Appellant and, inter alia, pointed out that by Deed of Sale dated 29.10.1980, the vendors of the Appellants sold the suit plot to the Respondents. It is further their case that the alleged illegal structure was in existence from the year 1970 and they have been occupying the said structure without any objection. It is further their case that the said structure was in existence and the Appellant was well aware of the existence of the said structure. It is further their case that the Appellant is not entitled to any relief in the suit and, consequently prayed that the suit be dismissed.

5. The learned Civil Judge, Junior Division, Ponda, by Judgment and Decree dated 28.02.2003, partly decreed the suit filed by the Appellants. Being aggrieved by the said Judgment, the Respondent preferred an Appeal before the learned Addl. District Judge, Panaji, being Regular Civil Appeal no. 63/2003, which by Judgment and Decree dated 02.12.2003, was allowed and the impugned Judgment passed by the learned Judge dated 28.08.2003, was quashed and set aside and the suit filed by the Appellant came to be dismissed. The learned Lower Appellate Court, inter alia, whilst appreciating the evidence on record, came to the conclusion that the Respondent is the owner in possession of the suit plot pursuant to the Sale Deed dated 29.10.1980.

6. Being aggrieved by the said Judgments passed by the Lower Appellate Court, the Appellant has preferred the above Second Appeal which came to be admitted on the aforesaid substantial questions of law.

7. Shri R. G. Ramani, learned Counsel appearing for the Appellant, in support of first substantial questions of law framed by this Court, has pointed out that the Lower Appellate Court has erroneously dismissed the suit filed by the Appellant without considering that there was a prayer for recovery of possession. Learned Counsel has pointed out that when a specific relief for recovery of possession has been claimed by the Appellant merely because no declaration has not been sought would not defeat the suit filed by the Appellant. Learned Counsel further points out that considering the fact that the Sale Deed was executed in the year 1976, the question of executing the second Sale Deed does not arise at all. Learned Counsel as such submits that the second Sale Deed is null and void and cannot create any legal effects.

8. With regard to the second substantial question of law, learned Counsel appearing for the Appellant has pointed out that the question of invoking Article65 of the Limitation Act does not arise at all as, according to him, the suit filed by the Appellant for possession is based on title. Learned Counsel further pointed out that it is not the case of the Respondent that he is claiming any right to the suit plot by adverse possession. Learned Counsel appearing for the Appellant as such submits that invoking Article 65 of the Limitation Act by the Lower Appellate Court to defeat the suit of the Appellant is totally misconceived. Learned Counsel further pointed out that the Lower Appellate Court has also erroneously come to the conclusion that the Respondent is a bonafide purchase to defeat the claim of the Appellant. The learned Counsel further pointed out that when a registered Sale Deed was already executed in favour of the Appellant, the second Sale Deed being null and void, the question of claiming such right as bonafide purchaser cannot be accepted. Learned Counsel as such submits that the impugned Judgment and Order passed by the Lower Appellate Court deserves to be quashed and set aside.

9. On the other hand, Shri M. B. D' Costa, learned Senior Counsel appearing for the Respondent, has supported the impugned Judgment passed by the Lower Appellate Court. Learned Senior Counsel further pointed out that there is structure in the suit plot which was constructed by the Respondent way back in the year 1970. Learned Senior Counsel has taken me through the pleadings in the written statement to show that there is a specific plea to the effect that the structure was constructed in the year 1970. Learned Senior Counsel further pointed that such structure was in existence much prior to the execution of the Sale Deed. Learned Senior Counsel has pointed out that the title has vested in favour of the Respondent in view of the Sale Deed dated 29.10.1980 and, as such, the Lower Appellate Court was justified to come to the conclusion that the title to the suit plot is of the Respondent. Learned Senior Counsel further pointed out that in any event, considering that the structure was existing in the year 1970, the Respondents are Mundkars of the suit plot and, as such, their possession and occupation has to be protected in view of the provisions of the Mundkar Act 1975. Learned Senior Counsel further pointed out that the Lower Appellate Court has rightly appreciated the evidence on record and has come to a correct conclusion that the Appellant is not entitled for any reliefs and dismissed the suit filed by the Appellant. Learned Senior Counsel further pointed out that considering that the Respondent is a bonafide purchaser, the question of evicting the Respondent from the suit structure cannot be permitted. Learned Senior Counsel as such submits that the above Appeal deserves to be quashed and set aside.

10. Having heard the learned Counsel and on perusal of the record, the first substantial question of law framed by this Court, Shri Ramani, learned Counsel appearing for the Appellant was justified to contend that merely because declaration has not been claimed, does not by itself non suit the Appellant. In the present case, it is not in dispute that the Appellant had purchased the same property pursuant to a Sale Deed dated 26.08.1976 which was duly registered before the Authorities on 28.10.1976. The Respondent is claiming the right to the property in view of the Sale Deed executed by the same vendors by Deed dated 29.10.1986. It is well settled that upon execution of the Sale Deed, the title of the property sold gets conveyed in favour of the purchaser. The registration of such Deed of Sale further confirms that title stands vested in the purchaser. The provisions of the Indian Registration Act read with the provisions of the Transfer of Properties Act clearly discloses that upon a conveyance being registered the title of the property gets divested from the vendor and passes on to the purchaser.

11. In the present case, in view of the Sale Deed executed on 26.08.1976, the vendors ceased to have any right or title to the suit plot. The subsequent Sale Deed allegedly executed on 29.10.1980 by the same vendor, is by a person who had no title or interest in the suit plot. Article 1555 of the Portuguese Civil Code clearly provides that no one can sell any property besides his own or in which he has any right and in case he sells something which belongs to another person, such contract is null and void. In the present case, in view of the said provisions of the Portuguese Civil Code, the second Sale Deed executed on 29.10.1980 is null and void. In fact, the Apex Court in the Judgment reported in MANU/SC/0368/2010 : (2010) 6 S. C. C. 666 in the case of Atla Sidda Reddy v. Busi Subba Reddy, has held at para 11 and 12 thus :

11. As indicated hereinbefore, the High Court accepted the evidence of DW 4 Lakshmamma and came to a finding that by virtue of Ext. B-2 she had transferred all her rights, title and interest in the suit properties in favour of Thondolu Mahaboob Basha and having divested her of the title to the suit properties, she was no longer competent to execute a further sale deed in respect of the same property in favour of Syed Ghouse Bi on (sic 10-5-1974) (Ext. A-1). The High Court having accepted the sale deed dated 22-5-1968 in favour of Thondolu Mahaboob Basha as being genuine, it came to the conclusion that since the said document was prior in point of time in relation to the subsequent document executed in favour of Syed Ghouse Bi, the petitioner-plaintiff, who had acquired his title through Syed Ghouse Bi alias Chand Begum, did not acquire any title to the suit properties. On such finding, the High Court reversed the judgment and decree of the first appellate court.

12. The factual aspect having been dealt with in detail by the courts below, ending in the findings of the High Court, we are not inclined to delve into the facts any further. As indicated by the trial court, Ext. B-2 is a crucial document and was admittedly anterior in point of time to Ext. A-1 subsequently executed by DW 4 in favour of Syed Ghouse Bi when she had already divested herself of title to the suit properties. The petitioner did not, therefore, acquire any title to the suit property and the suit was rightly dismissed.

Considering the said Judgment of the Apex Court and in view of the provisions of Article 1555 of the Portuguese Civil Code, the second Sale Deed executed on 29.10.1980 cannot create any title or right in respect of the suit property in favour of the Respondents herein.

12. With regard to the findings of the Lower Appellate Court that the Appellant is not entitled to the relief for restoring possession as he has not sought for a declaration that the said Sale Deed is null and void, the Apex Court in the Judgment reported in MANU/SC/8139/2006 : (2006) 5 S.C.C. 353 in the case of Prem Singh & Ors. vs. Birbal & Ors. has held at para 15 and 16, thus :

15. Section 31 of the Specific Relief Act, 1963 thus, refers to both void and voidable documents. It provides for a discretionary relief.

16. When a document is valid, no question arises of its cancellation. When a document is void ab initio, a decree for setting aside the same would not be necessary as the same is non est in the eye of the law, as it would be a nullity.

In view of the said Judgment of the Apex Court, merely because no declaration has been sought by the Appellants, would not disentitle him from the reliefs in the suit for as the Sale Deed invoked by the Respondents dated 29.10.1980 is null and void abinitio.

13. Considering the said aspect and taking note of the fact that there is no dispute about the identity of the parties in both the Sale Deeds, I find that the second Sale Deed executed in favour of the Respondent in the year 1980, is null and void and, as such, the question of claiming any rights on the basis of such Sale Deed cannot be accepted. The learned Lower Appellate Court was not justified to come to the conclusion that as a declaration to that effect has not been claimed, disentitles the Appellant to the possession of the suit plot. Hence, the first substantial question of law has to be answered in favour of the Appellant.

14. With regard to the second substantial question of law, on perusal of the written statement filed by the Respondent, there is no claim put forward by the Respondent that he is claiming any right to the suit plot by adverse possession. When there is no claim of adverse possession, the question of non-suiting the Appellant in view of Article 65 of the Limitation Act 1963, is totally erroneous. The learned Lower Appellate Court in fact has come to the conclusion that the suit for possession filed by the Appellant was not barred by limitation and as such there was no reason to reverse the prayer for restoration of possession. The said substantial question of law is answered in favour of the Appellant.

15. With regard to the third substantial question of law, once the Appellant has established title, it is well settled that possession follows title. Considering the fact that there is no case of adverse possession put forward by the Respondent, the Appellant cannot be refused of the possession. The learned Lower Appellate Court has held that the Respondent was a bonafide purchaser. In the pleadings of the Respondent, no such plea was taken. Apart from that the learned Judge also found the Sale Deed in favour of the Appellant dated 28.10.1976 to be valid. The Sale Deed was duly registered. The claim of the Respondent that the structure was in existence in the year 1970 has been rejected by the lower Appellate Court. Apart from that the suit structure was put up somewhere in the year 1985. With regard to the contention of Shri D' Costa, learned Senior Counsel appearing for the Respondent, to the effect that the Respondent is a Mundkar of the suit plot, I find that the said aspect cannot be dealt with in the said proceedings. No such claim was put forward by the Respondent in their pleadings. In any event, such disputes cannot be decided by the Civil Court and the same have to be adjudicated in appropriate proceedings. On perusal of the Judgments passed by the Courts below, I find that the Lower Appellate Court was not justified to come to the conclusion that the Appellant has not established the title as claimed in the suit. As the claim of the Respondent is on a void Sale Deed, I find that the Appellant who is the owner of the plot is entitled to the demolition of the encroachment and restoration of possession of the plot. The Lower Appellate Court after holding that the Sale Deed of the Appellant was valid and being a prior Sale Deed was not justified to interfere in the Judgment of the trial Court directing the restoration of possession and demolition of the encroachment. The findings of the Lower Appellate Court that the Respondent has purchased the suit plot without prior notice of the earlier Sale Deed and as a bonafide purchaser, cannot be accepted. On perusal of the written statements filed by the Respondent, I find no particulars given by the Respondent to that effect. When a person is seeking defence on that count, it is incumbent upon him to lay a foundation to that effect in the pleadings. In the present case, when no such pleadings are found in the written statement of the Respondent, the learned Judge was not justified to come to the conclusion that the Respondent was a bonafide purchaser. The third substantial question of law is answered in favour of the Appellant. In view of the above, I pass the following:

ORDER

(i) The Appeal is allowed.

(ii) The impugned Judgment of the Lower Appellate Court dated 02.12.2003 is quashed and set aside. The Appeal in RCA no. 63/2003 filed before the learned Addl. District Judge, Panaji, stands dismissed.

(iii) As such, the Judgment and Decree dated 28.02.2003 passed by the learned Civil Judge, Junior Division in Regular Civil Suit no. 100/1993/B is restored.

(iv)The Appeal stands disposed of accordingly with no Orders as to costs.