Supreme Court of India
JHARU RAM ROYversusRAMJIT ROY AND ORS.
- Citation
- 2009 INSC 32
- Decided
- 13 January 2009
- Disposal
- Dismissed
Holding
Section 43 does not apply where the transferee was complicit in the fraud, rendering the transfer void and the appeal dismissed.
Summary
The dispute involved the sale of 4 Bighas of agricultural land by Rajiv Lochan Roy in 1982, who falsely claimed his father Nakho Ram was dead, while the father was alive until 1990. The buyer, Jharu Ram Roy (appellant), was aware of the fraud. The other son, Ramjit Roy, filed a suit to set aside the deeds and claim possession. The trial court dismissed the suit, but the First Appellate Court and the High Court held the deeds void because the appellant participated in the fraud. The appellant argued that Section 43 of the Transfer of Property Act should protect him, invoking the doctrine of feeding the estoppel. The Supreme Court held that fraud vitiates the transfer, Section 43 does not apply when the transferee is complicit, and the doctrine of estoppel cannot override statutory prohibition. Consequently, the appeal was dismissed.
Issues considered
- Whether Section 43 of the Transfer of Property Act, 1882 applies when the transferee was aware of the fraud and participated in it.
- Whether the doctrine of feeding the estoppel can be invoked to give the transferee a benefit in such circumstances.
- Whether the deeds of sale executed by a person lacking authority are void ab initio.
- Whether adverse possession can be claimed despite the fraudulent nature of the transfer.
Legislation cited
- Code of Criminal Procedures. 107, s. 145
- Indian Contract Act, 1872s. 23
- Transfer of Property Act, 1882s. 43
Subjects
Transfer of Property ActSection 43fraudestoppelfeeding the estoppelvoid transferadverse possessionDayabhaga lawlimitationdeclaration suitproperty law
Judgment
(2009) 1 S.C.R. 305
~ _.._,. JHARU RAM ROY A
v.
RAMJIT ROY AND ORS.
(Civil Appeal No. 151 of 2009)
JANUARY 13, 2009
B
[S.B. SINHA, DR. MUKUNDAKAM SHARMA AND ASOK
KUMAR GANGULY, JJ.] ...
, ~t
TRANSFER OF PROPERTY ACT, 1882:
- s. 43-Transfer by unauthorized person who subsequently
acquires interest in property transferred - Member of a family
c
governed by Dayabhaga School of Hindu law, transferring
agricultural lands during the lifetime of his father representing
his father as dead - In the suit filed by other son, after the 0
"' death of his father for declaration of title and claiming
possession over the transferred land, transferee claiming the
benefit of s. 43 - HELD: First appellate court has recorded a
finding of fact that transferee was party to the fraud and that
he was not a victim thereof - The finding has been affirmed E
by High Court - Fraud vitiates all solemn acts - As the
transferee was aware of the fact that father of the transferor
was alive on the date of the sale deeds, provisions of s. 43
cannot be said to have any application to the case - Doctrine
of feeding the estoppel - Fraud..
F
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 151
of 2009.
From the Judgment/Order dated 04-06-2007 passed in
R.S.A. No. 169106 by the Hon'ble High Court of Guwahati. G
.....
Rituraj Biswas and Gopal Singh for the Appellant.
K. Sarda Devi for the Respondent.
305 H
306 SUPREME COURT REPORTS [2009) 1 S.C.R.
A The Judgment of the Court was delivered by ;..,,_.,,
ORDER
1. Leave granted.
B 2. This appeal is directed against a judgment and order
dated 4.6.2007 passed by the learned Single Judge of the High
Court Gauhati in RS.A No. 169/2006 preferred by the appellant t~
.....
herein, whereby and whereunder the judgment and order dated
18.4.2006 passed by a Civil Judge, Senior Division, was
c affirmed. ,,
3. The basic fact of the matter is not in dispute.
•
4. One Nakho Ram was the owner of the suit property. He
D had two sons, namely, Rajiv Lochan Roy and Kamjit Roy. The ,._
property in the suit admeasured 16 Bighas 4 Kathas.
5. Rajiv Lochan executed two deeds of sale in 1982, in
respect of about 4 Bighas of land, inter alia, contending that
he had half share in the said property. It is not in dispute that
E the family of Nakho Ram was governed by Dayabhaga School
of Hindu Law. It is furthermore not in dispute that in 1982, Nakho
Ram was alive and he expired only in the year 1990. Appellant,
however, claimed that in terms of the aforementioned deeds
of sale executed by Rajiv Lochan in the year 1982, .he had
F remained in possession of the vested property since the date
of purchase.
6. It is, furthermore, not in dispute that in the year 1990, a
proceeding under Section 107 as also Section 145 of the Code
G of Criminal Procedure was initiated and therein, Respondent
No.1 herein was put in possession of the property.
...
7. Respondent No.1 filed a suit in the year 1991 for
declaration of his title, confirmation of possession as also a
H
JHARU RAM ROY v. RAMJIT ROY AND ORS. 307
----~
decree for setting aside two deeds of sale executed by Rajiv A
Lochan in the year 1982. The said suit was dismissed by the
learned Trial Judge, inter alia holding that the legal
representatives of the proforma respondents having not been
brought on record, the suit had abated. It was furthermore held
that the defendant-appellant acquired title to the suit property B
by adverse possession. The suit so far as it ·related to setting
.,.. aside the aforementioned deeds of sale was, however, held to
be barred by limitation.
8. The First Appellate Court, however, on an appeal
preferred by the contesting respondents, reversed the said
c
findings of the Trial Court opining that as the defendant-
appellant was a party to the fraud perpetrated by Rajiv Lochan
in so far as he was, at all material times, aware that in the year
1990, Nakho Ram was alive and not dead, he cannot take
-f. benefit of the said deeds of sale and the same were void ab D
initio. The High Court, as noticed hereinbefore, has affirmed
the said view.
9. Learned counsel appearing on behalf of the appellant
would contend that the High Court committed a serious error E
in passing the impugned judgment in so far as it failed to take
into consideration the provisions of Section 43 of the Transfer
of Property Act, in terms whereof, having regard to the fact that
~
Rajiv Lochan had also died in the year 1992, the doctrine of
feeding the estoppel became applicable to the facts of the F
present case.
10. A finding of fact has been arrived at by the First
Appellate Court that the appellant was also a party to the fraud
inasmuch as he was all along aware that on the date of
G
execution of the deeds of sale, Nakho Ram was alive.
Indisputably, therefore, the appellant entered into the
aforementioned transaction knowing fully well that Nakho Ram
was alive in the year 1992, Rajiv Lochan could not have
executed the deeds of sale and only with a view to obviate the
H
308 SUPREME COURT REPORTS [2009] 1 S.C.R.
A legal difficulties, Nakho Ram was shown to have expired.
11. Appellant was furthermore aware that although Rajiv
Lochan did not inherit the property of Nakho Ram, he executed
-
the aforementioned deeds of sale. Rajiv Lochan, thus, having
no title to the pr~perty, by said deeds of sale or otherwise,
8
evidently could not have derived any title thereover.
Section 43 of the Transfer of Property Act reads as under:
"43. Transfer by unauthorised person who subsequently
C acquires interest in property transferred.- Where a person
fraudulently or erroneously represents that he is authorised
to transfer certain immovable property and professes to
transfer such property for consideration, I such transfer
shall, at the option of the transferee, operate on any interest
D which the transferor may acquire in such property at any
time during which the contract of transfer subsists.
Nothing in this section shall impair the right of
transferees in good faith for consideration without notice
E of the existence of the said option."
12. In this case, as the appellant averred that although in
the deeds of sale, a stipulation was made by Rajiv Lochan that
his father had expired, it cannot be said to.be a case where
he fraudulently or erroneously represented that he was
F authorized to transfer the said immovable property. As noticed
hereinbefore, a finding of fact had been arrived at by the First
Appellate Court that the appellant was a party to the fraud and
that he was not victim thereof.
G 13. Our attention, however, has been drawn to a decision
of this Court in [2007 (2) SCC 404]. In the said decision this
Court laid down the law in the following terms:
"12. In order to get the benefit of the said provision, the
H
JHARU RAM ROY v. RAMJIT ROY AND ORS. 309
-1
1
-~
conditions which must be satisfied are: A
- (1) the contract of transfer was made by a person
who was competent to contract; and
(2) the contract would be subsisting at the time B
when a claim for recovery of the property is made.
t- _. 13. However, the provisions would have no application if
the transfer was invalid as being forbidden by law or
contrary to public policy, as envisaged under Section 23
< of the Contract Act. Thus, no estoppel can be pleaded c
contrary to the provisions of a statute. The 'rule of feeding
the estoppel' shall apply in absence thereof.
14. The doctrine of feeding the estoppel envisages that
'where a grantor has purported to grant an interest in land D
which he did not at the time possess, but subsequently
acquires, the benefit of his subsequent acquisition, goes
automatically to the earlier grantee, or as it is usually
expressed, feeds the estoppel'.
E
15. The principle is based on an equitable doctrine that a
person who promised to perform more than he can perform
must make good his contract when he acquires the power
of performance. The difference between the ambit of
Section 41 and 43 of the Act is apparent. Whereas F
Section 41 provides that a transfer by an ostensible owner
cannot be avoided on the ground that the transferee should
take reasonable care to ascertain that the transferor had
power to make the transfer and to act in good faith before
a benefit th~reof if claimed by him. Section 43, on the other
G
hand, enables the transferee to whom a transferor has
made a fraudulent or erroneous representation to lay hold,
at his option, of any interest which the transferor may
subsequently acquire in the property, unless the right of any
subsequent purchaser for value without notice is in effect."
H
310 SUPREME COURT REPORTS [2009] 1 S.C.R.
A 14. Fraud vitiates all solemn acts. As the appellant was
aware of the fact that Nakho Ram had not expired in 1992, in
our opinion, the provisions of Section 43 of the Transfer of
Property Act cannot be said to have any application in the
-
instant case.
B
15. For the reasons aforementioned, this appeal is
dismissed. However, there shall be no order as to costs.
R.P. Appeal dismissed.
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