Holding

A bona‑fide transferee who derives possession from a decree‑holder landlord does not have the same immunity as a bona‑fide purchaser in an auction sale; the decree‑holder must restore possession to the judgment‑debtor when the decree is set aside.

Summary

The appellant, a tenant, was evicted by the landlord (respondent No.1) under an ex‑parte order, which was later set aside, and the tenant obtained a restoration order under Section 144 of the Code of Civil Procedure. Before the warrant could be executed, respondent No.2 claimed to be a bona‑fide transferee in possession under an agreement with the landlord and sought protection from eviction. The Rent Controller and Tribunal rejected his claim, but the Delhi High Court treated him as a bona‑fide purchaser akin to one in an auction sale and allowed his appeal. The Supreme Court held that a transferee who derives possession from a decree‑holder landlord does not enjoy the same protection as a bona‑fide purchaser in an auction sale; when the decree is set aside, the decree‑holder must restore possession to the original judgment‑debtor. Consequently, the Court set aside the High Court order and restored possession to the appellant.

Issues considered

Whether a person who obtains possession as a bona‑fide transferee from a decree‑holder landlord is entitled to the same protection as a bona‑fide purchaser in an auction sale under Section 144 CPC.
Whether the decree‑holder is obligated to restore possession to the judgment‑debtor when the decree is set aside, even if possession has been transferred to a third party.

Legislation cited

Code of Civil Procedure, 1908s. 144

Subjects

rent controlevictionSection 144 CPCbona fide transfereedecree holderrestoration of possessionlandlord‑tenant

Judgment

A GURJOGINDER SINGH
v. >--.,..
SMT. JASWANT KAUR AND ANR.

FEBRUARY 9, 1994
B
[S. MOHAN AND M.K. MUKHERJEE, JJ.]

Rent and Eviction/Code of Civil Procedure, 1908: S. 144, 0.9. R.13.-
Ex-parte order of eviction of appellant-tenant-Application for restitution of
possession allowed-Warrant ofpossession issued-Objection filed by another
..,,(_ .
c person claiming himself to be bona fide transferee-in-possession under an
agreement entered into between him and landlord-High Court holding ob-
jector as a bona fide transferee equating his status with that of a bona fide
purchaser in an auction sale-Held, status of a bona fide purchaser in an
auction sale in execution of a decree to which he was not a party stands on
D a different footing from that of a person who is inducted as a tenant by a
decree-holder-landlord-Decree-holder was bound to restore to judgment-
debtor subject matter of decree subsequently trans/erred to third person. J._

Respondent No.1, in execution of an ex-parte order passed against
the appellant-tenant, obtained possession of the suit premises. The appel-
E lant unsucessfully challenged the ex-parte order under Order 9 Rule 13 of
the Code of Civil Procedure 1908. In appeal, the Rent Control Tribunal
set aside the ex-parte order and revived the application for eviction.
Thereafter, the appellant filed an application under s. 144 of the Code of
Civil Procedure for restoration of his possession, which was allowed by the
F Rent Controller and warrant for possession was issued. Meanwhile
respondent No. 2 filed an objection claiming himself to be a bona fide
transferee-in-possession of the. suit premises in terms of an agreement
entered into between him and respondent no. 1. It was alleged that he did
not know about the earlier eviction proceeding initiated against the appel-
lant. The objection was overruled. The appeal preferred by the Respondent
G No. 2 was dismissed by the Tribunal. He preferred a second appeal which
was allowed by the High Court, holding that respondent no. 2 was a bona
fide transferee. Hence the appeal by the original tenant.
>-
Allowing the appeal and setting aside the Order of the High Court,
H this Court
794
GURJOGINDER v. SMT. JASWANT (MUKHERJEE, J.) 795

HELD: 1.1. The status of a bona fide purchaser in an auction sale in A
.. ~ execution of a decree to which he was not a party stands on a distinct and
different footing from that of a person who is inducted as a tenant by a
decree-holder-landlord. A stranger auction purchaser does not derive his
title from either the decree-holder or the judgment-debtor and, therefore
restitution inay not be granted against him but a . tenant who obtains
possession from the decree-holder-landlord cannot avail of the same right
B
as his possession as a tenant is derived from the landlord. [796-H; 797-A]

1.2. In the instant case, it is the decree-holder who has put respon-
\. ~
dent No. 2 in possession and, therefore, when the decree has been set aside
he is bound to restore to the judgment- debtor what he gained under the c
decree and subsequently transferred to respondent No. 2. [797-E]
-(
1.3. The High Court was not right in equating the status of respondent
no. 2 with that of a bona fide purchaser in an auction sale and in holding
that respondent no. 2 as a bona fide transferee had independent right to
occupy the suit premises and could not be evicted either in equity or in law D
not withstanding the order for restitution of possession passed in favour of
the appellant under s. 144 of the Code of Civil Procedure. [796-F-H]

Binayak Swain v. Ramesh Chandra Panigrahi & Anr., A.l.R. (1966)
S.C. 948 and Zain-ul-Abdin Khan v. Muhammad Asghar Ali Khan, (1888)
I.L.R. All. 166 P.C., referred to.
E

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3307 of
1983.
-""I>-
From the Judgment and Order dated 25.1.1980 of the Delhi High
F
Court in S.A.o. No. 417 of 1978.

Yogesh Kapur and AD. Sikri for the Appellant.

V.C. Mahajan and Rishi Kesh for the Respondents.

The Judgment of the Court was delivered by
G

M.K. MUKHERJEE, J. 1. In February 1971 Smt. Jaswant Kaur, the
·~,
respondent No. 1 herein, initiated legal proceeding before the Rent Con-
troller for eviction of her tenant, the appellant herein, and in execution of
the ex parte order passed therein obtained possession of the suit premises H
796 SUPREME COURT REPORTS [1994] 1 S.C.R.

A in October, 1971. Immediately thereafter the appellant filed an application
under Order 9 Rule 13 of the Code of Civil Procedure which was dismissed
by the Rent Controller. However, in appeal the ex-parte order of eviction
was set aside by the Rent Control Tribunal and the proceeding for eviction
filed by the respondent No. 1 was revived. On such revival the appellant
filed an application under Section 144 of the Code of Civil Procedure
B before the Rent Controller for restoration of his possession which was
allowed by an order dated May 13, 1977 and warrant for possession was
issued. Before, however, possession could be taken pursuant thereto, the
respondent No. 2 filed an objection before the Rent Controller contending
that in terms of an agreement he had arrived at with the respondent No.
c 1 he took possession of the suit premises on May 1, 1973 as a tenant under
her. He further contended that he was a bona fide transferee and that he
did not know about the earlier eviction proceeding initiated against the
erstwhile tenant. Consequently, he contended, he was not liable to be
dispossessed pursuant to the warrant of possession. The Rent Controller
D overruled the objection so raised and the appeal preferred by the respon-
dent No. 2 against the order of the Rent Controller was dismissed by Rent
Control Tribunal. Thereafter he moved the Delhi High Court by way of a
second appeal which was allowed on the ground that as a bona fide
transferee the respondent Ne. 2 had independent right to occupy the suit
premises and his right could not be disturbed either in equity or in law
E under Section 144 of the Code of Civil Procedure. Hence, this appeal by .
the original tenant.

2. In arriving at its conclusion that as a bona fide transferee the
respondent No. 2 could not be evicted from the suit premises notwithstand-
F ing the order for restitution of possession passed in favour of the appellant
the High Court equated the status of the respondent No. 2 with that of a
bona fide purchaser in an auction sale. Then, drawing inspiration from the
judgment of this Court in Binayak Swain v. Ramesh Chandra P_anigrahi &
Anr., A.I.R. (1966) S.C. 948, the High Court held that the right of a bona
fide purchaser or transferee stood on a footing different from that of the
G parties to the suit as the former had an independent right.

3. We are unable to share the view expressed by the High Court as
in our considered opinion, the status of a bona fide purchaser in an auction ,.>---.
. sale in execution of a decree to which he was not a party stands on a
H distinct and different footing from that of a person who is inducted as a
GURJOGINDER v. SMT. JASWANT [MUKHERTEE, J.] 797

tenant by a decree-holder-landlord. A stranger auction purchaser does n::it A
derive his title from either the decree-holder or the judgment-debtor and
therefore restitution may not be granted against him but a tenant who
obtains possession from the decree holder landlord cannot avail of the
same right as his possession as a tenant is derived from the landlotd. Even
in the case of Binayak Swain (supra) which the High Court relied upon B
this Court has drawn a distinction between purshase made by a decree-
holder and a stranger in auction-sale by quoting with approval the following
observation made in the case of Zain-ul-Abdin Kham v. Muhammad Asghar
Ali Khan, (1888) I.L.R. All. 166 (P.C.):

''It appears to their Lordship that there is a great distinc-
tion between the decree-holders who came in and pur-
c
chased under their own decree, which was afterwards
n:versed on appeal, and the bona fide purchasers who
come in and brought at the sale in execution of the decree
to which they were no parties, and at a tune when that
decree was a valid decree, and when the order for the sale D
was a valid order."

4. In our view the above principle will apply in the case in hand as
it is the decree-holder who has put the respondent No. 2 in possession and,
therefore, when the decree has been set aside he is bound to restore to the E
judgment-debtor what he gained under the decree and subsequently trans-
ferred to the respondent No. 2.

5. We, therefore, allow this app~al, set aside the order of the High
Court and direct restoration of possession to the appellant in terms of the
order passed by the Rent Controller. Needless to say such restoration will F
abide by the result of the evict\on petition filed by the respondent No. 1.
However, there will be no order as to costs.

R.P. Appeal allowed.