Holding

The respondents are not bona‑fide purchasers for consideration, and the appellants are entitled to restoration of possession under Section 13(B) of the Kerala Land Reforms (Amendment) Act, 1969.

Summary

The appellants, Othayath Lekshmy and others, were tenants who were dispossessed of their land after 1 April 1964 when the holding was sold at a court auction for arrears of rent. They filed an execution application under Section 13(B) of the Kerala Land Reforms (Amendment) Act, 1969, seeking restoration of possession, while the respondents (the auction purchaser and his assignees) claimed to be bona‑fide purchasers for consideration. The trial court held the appellants were tenants, their deposit sufficient, and that the respondents were not bona‑fide purchasers, setting aside the sale. The subordinate court and the Kerala High Court reversed this finding, declaring the respondents bona‑fide purchasers and dismissing the appellants' claim. The Supreme Court, exercising its discretionary power under Article 136, examined the evidence and held that the respondents were not bona‑fide purchasers and that the appellants were entitled to restoration of possession under Section 13(B), with the earlier deposit deemed valid. Consequently, the Supreme Court set aside the High Court judgment and allowed the appeal, restoring the trial court’s order.

Issues considered

Whether Respondents 1 and 2 are bona‑fide purchasers of the disputed land for adequate consideration within the meaning of the proviso to Section 13(B)(1) of the Kerala Land Reforms (Amendment) Act, 1969.
Whether the appellants are entitled to the benefit of Section 13(B)(1) for restoration of possession of the holding.

Legislation cited

Code of Civil Procedure, 1908s. 66
Constitution of Indias. 136
Kerala Land Reforms Act, 1963 (as amended by Act 9 of 1967 and Act 35 of 1969)s. 13(B), s. 2(17), s. 6

Subjects

Land reformsRestoration of possessionBona‑fide purchaserSection 13(B)Kerala Land Reforms ActExecution of decreeArrears of rentSpecial Leave PetitionArticle 136DepositConsiderationBenami transaction

Judgment

OTHAYATH LEKSHMY AND ANR. A
v.
NELLACHINKUNIYIL GOVINDAN NAIR AND ORS.
-~-
APRIL 19, 1990

[B.C. RAY ANDS. RA1NAVEL PANDIAN, JJ.] B

Kera/a Land Reforms Act-Amended by 9 of 1967 & 35 of 1969-
Section 13(B)-When the tenant is entitled for restoration of possession
'':( or when the bona fide purchaser is entitled for protection.

Constitution of India, 1950. Article 136-lnterference of Supreme
y Court-Where manifest injustice or grave miscarriage of Justice results. c
The appellants tiled an Execution Application in 1970 in the Court
of Munsiff under Section 13(B) of the Land Reforms Act 1969 for the
restoration of the possession of the properties which were sold in Court
-;< auction in pursuance of a decree for arrears of rent. The decree holder
and Court auction purchasers were close relatives. The sale took place on D
26.11.1962 and \vas confirmed on 14.8.1964. It is the 3rd Respondent a
stranger in the present appeal who purchased the property in the Court
auction and got the possession of the same on 9.1.1965 from the appel-
larits. The appellants trespassed ·into the suit property again and were
ejected in 1966 pursuant to a decree in a suit. Thereafter the 3rd
Respondent i.e. the auction purchaser assigned the property in favour E
~ of Respondents No. 1 & 2 who were the close relatives vide sale deeds
dated 5.12.1966 (Exts A2 and A3). The appellants had already fded
Execution Application, for restoration of possession after making
necessary deposit for the purchase money under section 6 of Act 9 of
1967. The same was pending when Act 35of1969 came into force and so

..-
~

,
the appellants made an application with a prayer that the earlier
deposit be treated as a deposit under section 13(B) of 1969 Act.
F

~· The Court auction. purchaser i.e. 3rd Respondent and his
assignees Respondents No. 1 & 2 strongly contended that appellants
have no interest in the properties. The appellants attacked the validity
of the sale deeds being made without consideration. The trial Court G
held that the appellants were tenants when they were dispossessed and
also held that the deposit made by th~ appellants was sufficient for
restoration of possession, and Respondents No. l & 2 are not bona fide
purchasers for consideration, and hence set aside the sale.
~
'
The Respondents No. l & 2 made application before the sub-court H

539
540 SUPREME COURT REPORTS [1990] 2 S.C.R.

A and the court held the petitioners were competent to maintain the appli-
cation and were bona fide purchasers as per records such as revenue
and tax receipts plus the admission of the vendor and vendee as to the
payment of consideration. As to the deposit made hy the appellants it
was considered to be sufficient in case they were found entitled for
restoration of possession; set aside the Trial Court order and allowed
B
the appeal.

The appellants therefore filed E.S.A. in the High Court and the
High Court upheld that the decision and the decree of the lower Appel-
late Court as per evidence, and as circumstances of the case complied
with public records establishing that Respondents I & 2 are the bona
c fide purchasers for consideration. But the first appellate court concur-
red with the Trial Court regarding the deposit already made to be
sufficient and the interest accrued would be directed to be deposited if
the appellants were found entitled to restoration of po8session. The said
finding has not been dislodged by the High Court.
D Allowing the Special Leave Petition, this Court,

HELD: In the instant case, two substantial questions are involved
i.e. (1) whether respondents l & 2 are bona fide purchasers of the
scheduled land in dispute for adequate consideration and thereby
entitled to the benefit of the proviso inserted vide Act 35 of 1969 to sec.
E l3(B)(l). [547F]

(2) Whether the appellants are entitled to the benefit of sub-
section (l) of section 13(B) of the Act. [547F-G]

As per section l3(B)-where any holding has been sold in execu-
F tion of any decree for arrears of rent and the tenant has been dis-
possessed of the holding after the 1st day of April 1964 and before
the commencement of the Kerala Land Reforms (Amendment) Act
1969, such sale shall stand set aside and such tenant shall be entitled to
restoration of possession of the holding subject to the provisions of this
section. [558 B-C]
G
Provided that nothing in this sub-section shall apply in any case
where the holding bas been sold to a bona fide purchaser for considera-
tion after the date of such dispossession and before the date of the
publication of Kerala Land Reforms (Amendment) Bill 1968 in the
Gazettee. [5540-E]
H
OTHAYATH v. N.G. NAIR 541

The concurrent finding of facts by both the appellate courts that
A
Respondents No. 1 & 2 are bona fide purchasers for consideration
warrant interference because both the appellate courts have con-
veniently ignored and excluded from consideration even the relation-
ship of the parties inter-se i.e. the decree holder, court auction pur-
chaser are close relatives and have assigned the property in favour of
their close relatives and a stranger. This assumes much importance and B
significance in evaluating the evidence in the light of the facts and
circumstances of the case for reaching satisfactory conclusion. The
court has failed to render any fmding on substantial question of
Law. The lack of recitals with regard to the consideration has also
been completely ignored. It seemed to have disposed of the case
summarily. [553B-D I
c
It is not merely the inadequacy of consideration as pointed out by
the lower appellate court but there is lack of evidence in substantiating
the recitals of the documents that Respondents No. 1 & 2 are bona fide
purchasers. The receipts for the payment of tax, rent or revenue are by
themselves cannot dispel the claims of the appellants. [54SC I D

The conclusion arrived at by both the courts is only backed by
assertions rather than by acceptable reasoning based on the proper
evaluation of evidence. So the evidence and circumstances of the case
coupled with the evidence on record do establish that the Respondents 1
& 2 are not bona fide purchasers for consideration. [SS3E-F] E

Discretionary powers under Article 136 bas to be exercised spar-
ingly bot when there are exceptional and special circnmstances justify-
ing the exercise of discretionary powers and where manifest injustice or
grave miscarriage of justice has resnlted by overlooking or ignoring or
excluding material evidence resnlting in undne hardships, this Court F
will be.justified in stepping in and interfering with the concurrent find-
~ ings of facts in the interest of justice and it is also the duty of this Court
I
to remedy the injustice so resulted. Dipak Baneriee v. Lilabatichak-
raborty. [1987] 4 SCC 161, relied on. [552H; 553A-B]

On the question whether the appellants are entitled to the benefit G
of section 13(B)(l) of the Act, it was held: [553G I

The Kerala Land Reforms Act of 1963 came into force on
1. 4.1964, Act 9 of 1967 was a temporary Act and remained in force till
31.12.1969, Act 35 of 1969 came into force from 1:1.1970 and section
13(B) is substantially on the same terms as section 6 of 1967 Act with a H
542 SUPREME COURT REPORTS [1990] 2 S.C.R.

A proviso super-added. To invoke section 13(B) two conditions are sine
qua non. (1) Any holding to which a tenant is entitled to restoration of
possession should have been sold in execution of any decree for arrears
of rent. (2) The tenant should have been dispossessed of the holding
after 1.4.1964 and before the commencement of 1969 Act. [553H; 554A-CJ

B Thus the tenant shall be entitled to restoration of possession under
section 13(B) provided the holding is not sold to a bona fide purchaser
for consideration, after the date of dispossession and before the publica-
tion of the Kerala Land Reforms (Amendment) Bill 1968 in the Gazet-
tee. The appellants are entitled to have the benefit of sub-section (1) of
section 13(B) only if they have made the deposit of the purchase money
C together with interest at the rate of 6% Per Annum in the Court and
applied to the Court for setting aside the sale and for restoration of the
holding. The appellants in the instant case had already made deposit
under 1967 Act and it was pending when Act 35of1969 came into force.
So the appellants made an application with a prayer to treat the said
deposit as continuation unaffected by the provisions of 1969 Act. [5540-FJ
D
The Language of section 13(B) is plain, clear and unambiguous
and the very purpose of the section is to vest rights on the displaced
tenants, which is the dominant purpose of the statute, which should be
considered. [554G-H)

E P. Rami Reddy & Ors. v. State of Andhra Pradesh & Ors., [1988) A
3 SCC 433; Skandia Insurance Co. Ltd.·v. Kokilaben Chandravadan &
Ors., [1987) 2 SCC 654 and M/s. Doypack Systems Pvt. Ltd. v. Union
of India & Ors., [1988) 2 SCC 299, relied on.

The sale of holdings of the appellants was in execution of the
F decree for arrears of rent in 0.S. No. 817 of 1943, and appellants are - --4,_
tenants who were dispossessed of the holdings after 1.4.1964 and before
the commencement of 1969 Act. They are therefore entitled to restora-
tion of possession of the properties in dispute but without prejudice of
the rights if any of the Respondents Nos. 7 to IO who are the wife and
children of Gopalan Nambiar. The amount under deposit made by the
G appellants is permitted to be withdrawn by respondents I to 3. [558B-C]

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1924
of 1990.

From the Judgment and Order dated 6.8.1986 of the Kerala High
H Court in E.S.A. No. 15 of 1979.
OTIIAYATII v. N.G. NAIR [PANDIAN, J.] 543

K.K. Venugopal, M.K. Sasidharan and P.K. Pillai for the
A
Appellants.
--·-------
T.S. Krishnamoorthy Iyer, P.S. Poli, S. Balakrishnan, Deepak
Nargoalkar, E.M.S. Anam, R.M. Keshwani, M.K.D. Namboodiri and
Irfan Ahmed for the Respondents.
B
The Judgment of the Court was delivered by

S. RATNAVEL PANDIAN, J. Special leave granted.

The unsuccessful appellants herein have preferred this appeal
against the judgment of the High Court of Kerala dated 6.8.1985
passed in E.S.A. (Execution Second Appeal) No. 15 of 1979 whereby c
the High Court dismissed the said appeal filed by the appellants. The
relevant facts giving rise to this appeal are necessary to be recapitu-
lated and they are as follows:

Othayath Gopalan Nambiar (since dead) and Othayath Lekshmy D
Amma (who is the first appellant herein) filed an Execution Applica-
tion No. 556 of 1970 in Original Suit No. 817 of 1943 in the court of the
Munsiff of Badagara under Section 13(B) of the Land Reforms Act, as
amended by the Amending Act 35 of 1969 (hereinafter referred to as
the 'Act') for restoration of possession of the properties mentioned in
the schedule of the application, which were sold in court auction for E
arrears of rent in pursuance of the decree made in O.S. No. 817 of
1943. It seems that during the pendency of the proceedings before the
Munsiff, Othayath Gopalan Nambiar died and ther_eafter the first
appellant's son claiming to be the karnavan of the tavazhi got himself
impleaded as the third petitioner in the said Execution Application,
who is figuring as the second appellant herein. F

In order to decide the questions that arise for consideration,
certain salient and material facts may be recapitulated. The suit, O.S.
'No. 817 of 1943 was filed for recovery of arrears of rent of Rs.815 for
the Malayalam years 1116 to 1118, corresponding to English era 1941
to 1943. There were 11 defendants of whom Othayath GopalanNamb- G
iar and the first appellant were the defendants 2 and 3. A preliminary
decree was passed on 26.5 .1944 followed by the final decree on
29.11.1944. The decree-holder assigned the decree to another member
of his family, who in turn assigned it to one Kunhikannan. The rights of
Kunhikannan devolved on Respondents 2 to 4 in the Execution Appli-
cation who are Respondents 4 to 6 in this appeal and who brought the H
544 SUPREME COURT REPORTS [1990] 2 S.C.R.

property to sale. The sale took place on 26.11.1962. One Thekkayil
A Kanaran who was the first Respondent in the Execution Application,
i.e. the third Respondent herein purchased the property in the Court
auction held on 26.11.1962, which sale was confirmed on 14.8.1964
and consequently obtained delivery of the disputed scheduled prop-
erty extending to 8.70 acres of double crop wet land through court on
B 9.1.1965 from the possession of the appellants. Ex. C 3 is the delivery
account and report submitted by the Amin. The remaining extent of
the property was in the possession of the sub-tenants in respect of
which there was resistence with which we are not concerned here.

After the delivery has been effected, Gopalan Nambiar and the
first appellant herein trespassed into the suit property. Therefore, the
C Court auction purchaser filed O.S. 6 of 1966 in the court of the Sub-
ordinate Judge of Badagara for recovery of possession. The suit was
decreed as per the judgment Ex. B 16 dated 27.7.1966. Ex. B 15 is the
decree. Ex B 49 dated 25.8.1966 and Ex. B 50 dated 22.8.1966 are the
respective certified copies of the delivery account submitted by the
D Amin and the delivery warrant issued to Amin in O.S. No. 6 of 1966.
The auction purchaser, i.e. third respondent in this appeal assigned
portions of the property under sale-deeds Exts. A2 and A3 dated
5.12.1966 to the 5th and 6th respondents in the Execution Application,
who are the first and second respondent in this appeal. It is stated that
while the first respondent is stranger, the second respondent is none
E other than the wife of the fourth respondent. As we have pointed out
earlier, this fourth respondent is among the three respondents on
whom the rights of Kunhikannan devolved.

While it is so, Act 9 of 1967 came into force. So Gopalan
Nambiar and the first appellant filed Execution Application No. 1711
F of 1967 for restoration of possession under the said amended Act after
making the necessary deposit. While this E.A. was pending, Act 35 of
1969 tame into force (Kerala Land Reforms Amendment Act) repeal-
ing Act 9 of 1967. So the appellants filed E.A. 556/70 under Section 13
B of the Act for restoration of possession with a prayer that earlier
deposit made under Act 9 of 1967 be treated as a deposit under Act 35
G of 1969 and also under took to pay the balance, if any, as would be
found by the Court. The third respondent (court auction purchaser)
and his assignees Respondents 1 and 2 contended that the appellants
have no interest in the properties and the delivery of the property had
already been taken. The appellants attacked the validity of Ex. A2 and
A3 contending that the assignments in favour of Respondents 1 and 2
H were made without consideration and bona fides and that auction
OTHAYATH v. N.G. NAIR IPANDIAN, J.j 545

purchaser Thekkayil Kanaran°, Respondent No. 3 was only a benami-
A
dar of the decree-holder in the matter of the Court auction purchase.
This application (E.A. 556/70) was stoutly opposed by the respondents
inter-alia contending that the properties did not belong to the Tavazhi
of the appellants and the appellants have no right to the suit properties
and are not entitled to apply for restoration of possession. According
to the respondents, there is no valid deposit and after the delivery of B
the property has been effected, Gopalan Nambiar trespassed into the
properties and he was ejected by recourse to a suit and thereafter the
properties were assigned to Respondents 1 and 2 for proper considera-
tion and bona fides and they are in possession of the properties on the
strength of the said sale-deeds. The Trial Court held that the appel-
lants were the tenants of the properties when they were dispossessed
and the deposit made by the appellants was sufficient and the Respon- c
dents 1 and 2 are not bona fide purchasers for consideration. On the
said finding it allowed E.A. 556/70 and set aside the sale.

Aggrieved by the order of the Trial Court, the Respondents 1
and 2 filed A.S. 49/74 before the Sub Court, Badagara, which for O
deciding the appeal posed the following four points for its considera-
tion, namely: ·

1. Are the Petitioners entitled to maintain the application?

2. Is the deposit sufficient? E

3. Are the appellants bona fide purchaser for consideration'/

4. Whether the court sale is liable to be set aside and the restora-
tion of possession claimed allowable? If so, are the petitioners
liable to pay anything by way of value of improvements? · F

.}- The learned Judge answered the first point.:..
'

"that the petitioners are competent to m;pntain the
application,"
~· G
and the second point holding-

" . . . . . that the deposit when it was made is sufficient.
However the interest accrued till date of the present appli-
cation will be directed to be deposited in case the peti-
tioners are found entitled to restoration of possession." H
546 SUPREME COURT REPORTS [1990] 2 S.C.R.

Coming to the third point it has been held thus-
A
"The first respondent (third respondent in S.L.P.) had ~-~

absolutely no necessity to execute any sham documents.
The fact that respondents 5 and 6 (Respondents 1 and 2 in
the SLP) came into possession and exercised their rights
B under Exhibits A2 and A3 by payment of rent and revenue
and payment of consideration spoken to by both the vendor
and vendee are sufficient to hold that they are bona fide
purchasers for consideration."

Under the .fourth point, the relief claimed by the appellants was held
"'
'+
to be rejected. In the result, the order of the Trial Court was set aside
c and the appeal was allowed dismissing E.A. 556/70.

The learned Subordinate Judge has also expressed his opinion in
~
his judgment that in summary proceedings under Section 13B of the
Act, the plea of the appellants that the third respondent was a be-
D namidar of the fourth respondent cannot be allowed to be raised in the
light of Section 66 of th_e Civil Procedure Code.

On being dissatisfied with the judgment of the Subordinate
Judge, the appellants preferred E.S.A. No. 15/79. The respondents
filed their cross objections. Though the High Court admitted the
~
E appeal on being satisfied that the appeal involves as many as 11 substan-
tial questions of law, it disposed the appeal on a short ground that the
documents and the evidence adduced by the respondents 1 and 2
(Govindan Nair and Ambrolil Ammalu) clearly show that the respon-
dents 1 and 2 are bona fide purchasers of the properties in question for
consideration and thi:> plea of benami put forth by the appellants has to
F be negatived. The contentions in the cross objections were that for
.. A_, -
filing an application under Section 13(B)( 1) of the Act, a deposit of the
purchase money together with the interest at the rate of 6 per cent per --{
annum in the court is a condition precedent and that the finding of the
lower Appellate Court that the earlier deposit made under Act 9 of
1967 was sufficient and the interest accrued till the date of the Execu-
G tion Application under Act 35 of 1969 would be directed .to be ~

deposited in case the appellants were found entitled to restoration of
possession of the property is erroneous. The High Court disposed the
contentions in the main appeal observing thus: ~

"It is not necessary for me to examine this question and
H finally adjudicate it, since I have upheld the decision of the
OTHAYATH v. N.G. NAIR lPANDIAN, J.] 547

lower appellate Court on other grounds. I ortly indicate
A
that the respondents' counsel shought to sustain the conclu-
sion of the lower appellate court on other grounds as well."

In the result, the High Court affirmed the decree of the lower Appel-
late Court and dismissed the second Appeal with costs.
B
So far as the cross-objections are concerned, the High C,ourt passed
..,,~the following order:

'
"There is no need to dispose of the cross-objections on the
¥ merits. It is ordered accordingly."

Hence the appellants by this appeal are impugning the judgment of the c
High Court.
:.,,.~
Mr. K.K. Venugopal, Sr. Counsel appearing on behalf of the
appellants, Mr. T.S. Krishnamurthy Iyer, Sr. Counsel and Mr. P.S.
Poti, Sr. Counsel appearing on behalf of the first and second respon- D
dents respectively took us very meticulously and scrupulously through
the judgments of all the three courts and put forth the case of their
respective parties.

Having heard the learned counsel on either side for a consider-
-" able length of time, we are clearly of the view on a conspectus of the
relevant Section 13(8) of the Act and on the factual matrix of the case
E
that the result of the case would depend upon the decision of two
substantial questions invloved, they being-
-..
(1) Whether respondents 1 and 2 are bona fide purchasers of the
>--·
scheduled land in dispute for adequate consideration entitl- F
....
r
ing to the benefit of the proviso to Section 13(8)(1)?

(2) Whether the appellants are entitled to the benefit of sub-
Section (1) of Section 13(8) of the Act?

Before making a more detailed and searching analysis on diffe- G
rent aspects of the case, it would be necessary for proper understand-
ing of the issues involved to reproduce the relevant provisions of Sec-
........ lion 13(8)(1) of the Act, on the pivotal of which both the quest10ns
revolve.

Section J3B: There is no requirement in any of the clauses H
548 SUPREME COURT REPORTS I1990] 2 S.C.R.

that an offer of readiness to comply with any order for ·
A deposit of costs must be expressed in any judgment, decree
or order of court, where any holding has been sold in · ·~·
execution of any decree for arrears of rent, and the tenant
has been dispossessed of the holding after the 1st day of
April, 1964 and before the commencement of the Kerala
B Land Reforms (Amendment) Act, 1969, such sale shall
stand set aside and such tenant shall be entitled to restora-
tion of possession of the holding, subject to the provisions -~
of this Section;

Provided that nothing in this sub-Section shall apply in any ...,_
case where the holding has been sold to a bona fide pur-
c chaser for consideration after the date of such disposses-
sion and before the date of publication of the Kerala Land
Reforms (Amendment) Bill, 1968 in the Gazette. ~

If the answer to the first question is in the affirmative, then there
D is no need to consider the second question as it would be only
academic. We, therefore, shall now address ourselves in the first
instance whether the concurrent finding of facts by both the Appellate
Courts relating to the first question warrant interference.

Before the Trial Court whilst the appellants examined PWs 1 to 4
E and filed Exhibits Al to A22, the respondents examined RWs 1 to 4 ~
and marked Exhibits B. l to B.58. Besides, Ex. X-1, X-2, X-3, X-5 and
X-6 and C. l to C.4 were also exhibited.

The Respondents 4 to 6 admittedly are brothers. ThoulUI at the
initial stage, Mr. Krishnamurthy Iyer did not accept the relationship·of _.....
F the third Respondent with Respondents 4 to 6 on the ground of lack of
evidence, subsequently no serious dispute was raised about the said
relationship. The Trial Court has proceeded on the ground that the
......
Respondents 3 to 6 are brothers being the sons of Kunhikannan in
whose favour the decree had been assigned. However, it is admitted
during the course of hearing of this appeal that the third Respondent is
G not a direct brother of Respondents 4 to 6, but son of the step-mother
of Respondents 4 to 6. The second Respondent Ambrolil Ammalu is
admittedly the wife of the fourth Respondent Krishnan. The first
Respondent Govindan Nair is a stranger. The third Respondent, the ~_...
Court auction purchaser sold the property extending 4.35 acres in
favour of the first Respondent and the remaining half in favour of the
H second Respondent under sale-deeds Exts. A.2 and A.3 dated
OTHAYATH v. N.G. NAIR [PANOIAN, J.] .. 549

5 .12.1966. Consideration mentioned in each of the sale-<leeds Exts.
A
A.2 and A.3 is Rs.3,000. Out of Rs.3,000 shown as consideration for
A.2 a sum of Rs.2,500 is said to have been left with the first Respon-
dent for payment of arrears of rent. In Ex. A.3, it is recited that the
third respondent is said to have already received Rs.2,000 on a promis-
sory note from the second Respondent for meeting the expenses incur-
red by him for conducting O.S. No. 6/66. The said sum of Rs.2,000 is B
stated to have been adjusted towards the consideration under Ex. A3.

The first Respondent has produced a receipt (Ex. B28) showing
that out of the amount of Rs.2,500 left with him he had paid a sum of
Rs. 100. There is no other document evidencing the discharge of the
entire alleged arrears of rent oui.of Rs.2,400. When the third Respon- C
dent was questioned about the promissory note on the strength of
which he is stated to have borrowed a sum of Rs.2,000, he has stated
that he had returned the promissory note. This evidence as rightly
pointed out by Mr. Venugopal is highly unacceptable because in usual
practice whenever a debt, borrowed on a promissory note is dis-
charged that promissory note is returned to the borrower and never D
left with the lender. Moreover, the evidence of the third Respondent is
contradicted by RW. 3, the son of the second Respondent. According
to RW. 3, when Ex. A.3 was executed, the promissory note was re-

-·
turned to the third Respondent. According to Mr. Venugopal, this
contradictory version betwixt the evidence of the first Respondent and
RW. 3 clearly shows that the recital regarding payment of considera- E
tion to the extent of Rs.2,000 in Ex. A.3 is not genuine and acceptable
and that Ex. A.3 is not fully supported by consideration. As per the
recitals of consideration under Exhibits A.2 and A.3 the total cash
consideration received by the third Respondent was only Rs.1,500 i.e.
Rs.500 from the first Respondent and Rs.1,000 from the second
Respondent. It is vehemently urged on behalf of the appellants that F
the third Respondent after purchasing the property for Rs.815 in 1962
would not have parted with it after fighting several litigations for a
cash consideration of Rs . 1,500 only. The evidence of the third
Respondent that he left a sum of Rs.2,500 with the first Respondent
for discharging arrears of rent and earlier received a sum of Rs.2,000
from the second Respondent on a promissory note is not credit worthy G
in the absence of any supporting contemporary documentary evidence.
His assertion that he paid the amount for the Court auction purchase in
the year 1962 out of the money in his possession as well as from
borrowings shows that he was a man of slender means. When he was
confronted from whom he borrowed that amount, his answer was that
he did not remember from whom and how much he borrowed. The H
550 SUPREME COURT REPORTS [1990) 2 S.C.R.

Trial Court has rightly pointed out in paragraph 19 of its Order that
A
the third Respondent did not leave any impression that he was con-
versant with the various pending litigations regarding the present
property.

Mr. Venugopal drew out attention to another piece of evidence
B of RW3, deposing that his father was never consulted with regard to
Ex. A3 and assailed his evidence as incredible and bereft of truthfulness
and trust worthiness. Coming to the sale-deed, Ex. A2 it is stated that
the first Respondent is residing about 11 miles away from Palayed
Amson where the property is situated. He has no other property in
Amson. The reason given by him for purchasing this property which
c
was already riddled with litigation is not at all convincing.

The first appellate Court while perfunctorily rejecting the
-
. reasoning of the Trial Court with regard to the consideration part of A
Ex. A2 and A3 disposed of that contention in a summary manner
holding:
D
"The apparent inadequacy is no ground to think that there
is no consideration ..... I don't think that the recitals in
Exhibits A2 and A3 can be overlooked for this or the other
reasons stated by the learned Munsiff."

E Then relying on Exhibits B 17, B28, B3 l, B41 and B45 and other ·
documents it concluded:

"that the Respondents 1 and 2 came int~ possession of the
properties and exercised their rights under Exhibits A2 and
A3 by payment of rent and revenue and payment of consi-
F deration spoken to by both the vendor and vendee and as
such they are bona fide purchasers for consideration."

The High Court accepting the reasons given by the sub-Judge
held thus:

G "Most of these documents are public records or registers
kept in the respective village office and proceedings in
courts. There is no error of law in placing reliance on such
documents. The finding entered by the learned Subor- c-""'
dinate Judge that respondents 5 and 6 are bona fide
purchasers for consideration is based on substantial evi-
H dence. It cannot be said to be arbitrary or unreasonable or
perverse."
OTHAYATH v. N.G. NAIR [PANDIAN, J.] 551

But both the Appellate Courts have conveniently ignored even
A
the relationship of the parties which assumes much importance and
significance in evaluating the evidence in the light of the facts and
--------- circumstances of the case for reaching a satisfactory conclusion and
seem to have summarily disposed of the case of the appellants.

The question is not the mere inadequacy of consideration as B

·«
1
.. /
pointed by the lower appellate Court, but lack of evidence in sub-
stantiating the recitals of both the documents. The next contention
advanced by Mr. Venugopal is that though the High Court has
formulated as many as 11 substantial questions of law, it has not dealt
' -V with any of them enumerated as (a) to (e) and examined the question
No. (f) in the proper perspective. Further the important question No.
(g) reading "Is not the admitted fact that the 6th respondent is the wife
c
of the 2nd respondent prima facie proof that she is not a bona fide
...,-- purchaser for value" is not at all dealt with. It may be noted in this
connection that the 6th respondent and the 2nd respondent referred to
in that question are Ambrolil Ammalu (2nd respondent herein) and
Krishnan (4th respondent herein). As pointed out supra the High D
Court itself has expressed that it was inclined to dispose of the appeal
'on a short ground'.

._ The bone of contention of Mr. Krishnamurthy Iyer and Mr. Poti
is that it is not open to the appellants to reagitate the matter and
request this Court to disturb the concurrent finding of facts arrived at E
by both the appellate Courts which had rendered their findings on the
proper evaluation of the evidence and there can be no justification to
review or re-appreciate the evidence to take a contrary view in the
'- absence of any contemporaneous document in support of the plea of
the appellants. In addition to the above, Mr. Poti urged that the appel-
~ !ants have not properly and satisfactorily discharged the onus of proof F
.cast upon them and the concurrent findings based on voluminous
~- documents, the copies of which are not annexed to the SLP for perusal
of this Court, do not call for interference.

In reply to the above arguments, Mr. Venugopal has pointed out
that none of the documents referred to in the judgments of the appel- G
late Courts would either improve the case of the respondents or deny
the claims of the appellants. Of the documents relied upon by the
appellate Courts, Ex. B17 and B31 are the true extracts showing pay-
~' ment of tax in the Village Officer Day Book. Ex. B28 is a rent receipt
dated 23.2.1969 issued by the receiver appointed in O.S; 1/64 on the
r· file of the Sub Court (lower appellate Court). B. 42 is a true extract H
'
552 SUPREME COURT REPORTS I1990] 2 S.C.R.

from the Foodgrains Cultivation Register and B .46 is a true extract
A from the Peringathor Village Account. Ex.B.41 to B.45 are the levy
notices and revenue receipts for the years 1967, 1968. 1969 and 1973.
Exhibits B.55 to B.59 are copies of orders in M.C. No. 3/71. As rightly
pointed out by Mr. Venugopal, it is but natural that the receipt for the
payment of tax, rent receipt, revenue receipt etc., are in the names of
B the persons in whose names the properties stand and therefore those
documents cannot by themselves dispel the claim of the appellants.
Besides, urging with all emphasis that Exhibi.ts A2 and A3 are only
sham and nominal documents, it has been incidentally urged by Mr.
Venugopal that the transaction under these two sale-deeds is benami
in nature. This argument was stoutly resisted by Mr. Krishnamurthy
Iyer stating that in the teeth of Section 66 of the Code of Civil Proce-
c dure and in the absence of any proceedings to set aside the sale in
favour of respondents 5 and 6 on the ground of fraud etc., the plea of
benami transaction cannot be countenanced. He also cited the deci-
sion in Mithilesh Kumari and Another v. Prem Behari Khare, [1989] 2
SCC 95. But Mr. Venugopal explained his argument that he has not
D advanced that argument to set aside the sale-deeds on the ground of
benami transaction, but only for scrutinising the circumstances of the
transaction in examining the validity of the sale-deeds. However, as
the plea of benami transaction is not pressed into service, it need not
detain us any more.

E We shall now examine whether this Court would be justified in
interfering with the concurrent finding of facts in exercise of its dis-
cretionary powers under Article 136 of the Constitution of India. In a
recent decision in Dipak Banerjee v. Lilabati Chakraborty, [1987] 4
sec 161 it has been observed thus:
F "That jurisdiction (under Article 136 of the Constitution of
India) has to be exercised sparingly. But, that cannot mean
that injustice must be perpetuated because it has been done
two or three times in a case. The burden of showing that a
concurrent decision of two or more courts or tribunals is
manifestly unjust lies on the appellant. But once that
G burden is discharged, it is not only the right but the duty of
the Supreme Court to remedy the injustice."

No doubt, this discretionary power has to be exercised sparingly;
but when there are exceptional and special circumstances justifying the
exercise of the discretionary powers and where manifest injustice or
H grave miscarriage of justice has resulted by overlooking or ignoring or
OTHAYATH v. N.G. NAIR [PANDIAN, L) 553

excluding material evidence resulting in unduly excessive hardships,
A
this Court will be justified in stepping in and interfering with the
_..._ . concurrent finding of facts in the interest of justice and it is also the
duty of this Court to remedy the injustice, so resulted. Vide Basudev
Hazra v. Meutiar Rahaman Manda!, [1971) 3 SCR 378 and Bhanu
Kumar Shastri v. Mohan Lal Sukhadia and Others, [1971] 1 SCC 370 at
pages 385 and 386. B

_ The present case, in our view, suffers from the infirmity of
~ excluding, ignoring and overlooking the abundant materials and the
evidence, which if considered in the proper perspective would have led
.~ to a conclusion contrary to the one taken by both the appellate Courts.
• The relationship of the parties inter se has been completely and con-
veniently ignored and excluded from consideration. In fact, the High c

*· Court has not rendered any finding on question No. (g) which is one of
the eleven substantial questions of law formulated in paragraph 3 of its
judgment. The lack of evidence in support of the recital in regard to
the consideration is completely overlooked. Therefore, in view of the
above exceptional and special cirCUmstances appearing in this case, this D
Court will not be justified in refusing to exercise its discretionary
powers merely on the ground that the conclusion of both the Courts is
concurrent.

• For the discussions made above, we are of the view that the
~ conclusion arrived at by both the appellate Courts is only backed by E
assertions rather than by acceptable reasoning based on the proper
evaluation of evidence and so we are unable to subscribe to the concur-
rent finding that the respondents 1 and 2 are bona fide purchasers of
the properties in dispute for consideration: On the other hand, we
hold that the evidence and circumstances of the case coupled with the
--~-evidence on record do establish that the respondents 1 and 2 are not F
, bona fide purchasers for consideration.
")- .

In the result, we hold that the respondents 1 and 2 are not
entitled to the benefit of the proviso to sub-Section (1) of Section
13(B) of the Act and answer the first question against the respondents
and in favour of the appellants. G

We shall now pass on to the next question whether the appellants
~are entitled to the benefit of Section 13(B)(l) of the Act.

The Kerala Land Reforms Act of 1963 came into force on
1.4.1964. Amended .Act 9 of 1967 was a temporary enactment which H
554 SUPREME COURT REPORTS I1990] 2 S.C.R.
remained in force till 31.12.1969. Thereafter, Act 35 of 1969 came into
A
force from, 1.1.1970 containing Section 13(B) which is substantially on
the same terms as Section 6 of Act 9 of 1967 with a proviso super-
added. To invoke this benevolent provision, the satisfaction of two
primary conditions are sine qua non. Those conditions are:

B (1) Any "holding" to which a tenant is entitled to restoration of
possession should have been sold in execution of any decree
for arrears of rent.

(2) The tenant should have been dispossessed of the "holding"
after the first day of April 1964 and before the commence- '!-
men! of the Kerala Land Reforms (Amendment) Act, 1969.
c
If these two essential conditions are fulfilled, then the sale in
execution of any decree for arrears of rent shall stand set aside
notwithstanding anything to the contrary contained in any law or in ~
any judgment, decree or order of court and the tenant shall be entitled
o to restoration of possession of such holding, but subject to the provi-
sions of this Section 13B. The only bar for the restoration of possession
under this Section 13(B)(l) is the sale of the holding to a bona fide
purchaser for consideration after the date of such dispossession and
before the date of publication of the Kerala Land Reforms (Amend-
ment) Bill 1968 in the Gazette. For invoking the benefit of sub-Section ii.
E ( 1) of section 13(B) the person entitled to r,estoration of possession of ""'7
his holding should within a period of 6 months from the commence-
ment of the Kerala Land Reforms (Amendment) Act, 1969 deposit the
purchase money together with interest at the rate of 6 percent per
annum in the court and apply to the court for setting aside the sale and
for restoration of possession of his holding. Once these legal for-
F malities are satisfactorily complied with then the Court by holding a .I:.
summary enquiry shall set aside the sale and restore the applicant to
possession of his holding. The explanation to that section says that the -(
term 'holding' includes a part of holding. The expression "holding" is
defined in Section 2( 17) of the Act.

G The language of Section 13(B) is plain, clear and unambiguous
representing the real intention of the legislature as reflected not only
from the clear words deployed but also from the very purpose of the
vesting of rights on the displaced tenants. To construe the provisions
of a statute especially of a benevolent provision like the one in ques- ..-.f
tion, we have to take into consideration the dominant purpose of the
H statute, the intention of the legislature and the policy underlying. Vide
OTHAYATH v. N.G. NAIR IPANDIAN, J.] 555

P. Rami Reddy & Others v. State of Andhra Pradesh & Others, [1988] 3
A
SCC 433; Skandia Insurance Co. Ltd. v. Kokilaben Chandravadan &
Others, [1987] 2 SCC 654 and M Is Doypack Systems Pvt. Ltd. v. Union
of India& Others, [1988]2SCC299.

Admittedly, the third respondent obtained delivery of the pro-
perty in question through court on 29.1.1965 from the possession of B
the appellants, who were the tenants of the said property which was
sold for arrears of rent and thereafter the appellants preferred a peti-
tion for restoration of possession of their holdings in Execution Appli-
cation No. 1711/67 under Section 6 of Act 9 of 1967 after depositing
-Y the sale amount of Rs.815 and the interest of Rs.255. Thus the appel-
lants have satisfied the conditions for entitlement of the possession of
the property. While this proceeding was pending, Act 35 of 1969 came c
into force repealing Act 9 of 1967. Therefore, the appellants filed the
Execution Application No. 566/70 in O.S. 817/43 praying that the
present application should be treated as a proceeding in continuation
of the earlier Execution Application and the amount deposited already
in the previous Execution Application should be treated as deposit for D
the present application with an undertaking to deposit the balance, if
any. Though it has been contended by the respondents that th_e appel-
lants have failed to establish that they were tenants at the time of the
dispossession, both the Trial Court as well as the first appellate Court
have concurrently found that the appellants were holding the property
as tenants and they were dispossessed. Before the High Court, it was E
contended that at the time of dispossession of the holding, the appel-
lants were not tenants but only trespassers, that the dispossesion was
only pursuant to the decree in O.S. No. 6/66 and that both the lower
Courts have not applied their minds to these salient and vital facts.
The learned Judge of the High Court has answered this contention in
the penultimate paragraph of his judgment observing thus: F

" This is a serious legal error. It is not necessary for
me to examine this question and finally adjudicate it, since
I have upheld the decision of the lower appellate court on
other grounds."
G
Suffice to mention here that the High Court has not specifically
dislodged the findings of the lower Courts that the appellants were
tenants at the time of the dispossession. However, we will deal with
this question presently.

The main thrust of the argument of Mr. Krishnamurthy Iyer is H
556 SUPREME COURT REPORTS i1990J 2 S.C.R. -

that the appellants are not entitled to restoration of the possession of
A their 'holding' because of an intervening cause, that being, that the
third respondent. got the possession of the property which is now
sought to be disturbed not in execution of the decree for arrears of
rent, but by filing a suit subsequent to'the coui;t,'\u,c.tion ~urchase. Th~t
intervening cause is explained by the learned counsel 'stating that after
---
B the property was delivered over to the third respondent on 29.1.1965,
Gopalan Nambiar (since dead) and the first appellant trespassed into
the land which necessitated the third respondent to institute a suiit
O.S. No. 6/66 in the Sub Court of Badagara which was decreed on
27. 7 .1966 as evidenced by the judgment (Ex. B 16). He continues to
state that the third respondent, only in pursuance of the execution of
this decree in O.S. 6/66 obtained possession of the property on
C 23.8.1966 and therefore Section 13(B)(l) in view of the said interven-
ing cause cannot be availed of since the third respondent though got
possession earlier by the auction purchase was dispossessed by the sub-
sequent event of trespass by the appellants and got possession by
instituting the suit O.S. 6/66. One other argument of the learned
D counsel is that as the sales under Exhibits A2 and A3 are only subse-
quent to the decree in O.S. No. 6/66, these transactions cannot be
brought into the dragnet of Section 13(B) and the said provision will
have no application to the facts of the present case. We are afraid, we
cannot permit this inconceivable argument to be advanced. Admit-
tedly, the third respondent purchased the property in court auction
E sale in pursuance of the decree for arrears of rent in O.S. No. 817/43
and obtained the possession by dispossessing the tenants, namely, the
appellants. It was only thereafter there was trespass by the appellants.
Therefore, the subsequent event of obtaining possession of the pro-
perty in pursuance of the decree in O.S. No. 6/66 will not in any way
alter the position that the appellants had been dispossessed in pur-
F suance of the decree for arrears of rent. The decree in O.S. No. 6/66
for obtaining possession from the trespassers does not confer any new
right or title over the property in favour of the third respondent.
Mr. Venugopal countered this argument sta.ting that this new plea
should not be allowed to be raised because this plea was never taken
both before the trial and the first appellate Courts. The reply given by
G Mr. Krishnamurthy Iyer is that since it is a question of law, it is permis-
sible to raise this question even at this stage. As we have said earlier,
even assuming that this plea could be raised, it has no substance in any
way affecting.the claim of the appellants for the reasons stated supra.

Mr. Poti after giving a brief note about the legislative history that
H Act 4 of 1961 was declared as void on 5.12.1961 in resp~ct of certain
OTHAYATH v. N.G. NAIR [PANDJAN, J.] 557

provisions and that thereafter_ Act 1 of 1964 was enacted which crune A
into force on 1.4.1964 repealing earlier Act 4 of 1961 advanced a
hesitant argument that the application is liable to be dismissed as the
entire amount has not been deposited in compliance with sub-Section
(2) of Section 13(B) which is a co•.1dition precedent to claim the resto-
ration of the possession of the p1 Jperty. Admittedly the appellants B
filed an application in the year 1967 for restoration of the possession of
the pwperiy under Section 6 of A,. 9 of 1967 and during the pendency
of that appfication, Act 35 of 1969 came into force. The applicant who
had already deposited the purchase amount together with interest has
made the request to treat that application as the one in continuation of
the later proceeding and undertook to pay the deficiency of the
amount, if any. The lower appellate Court in paragraph 6 of its judg- c
ment found that the deposit already made was sufficient and that the
interest accrued thereafter would be directed to be deposited in case
the appellants were found entitled to restoration of possession. This
finding of the first appellate Court concurring with the Trial Court has
not been dislodged by the High Court. It may not be out of place to D
mention that on account of certain divergent views expressed by
Judges of the Kerala High Court on this point the question was refer-
red to a Division Bench of that Court which drawing strength on the
ratio laid down by this-Court in State of Punjab v. Mohar Singh, [1955]
1 SCR 893 =AIR 1955 SC 84 observing:
E
"The line of enquiry would be, not whether the new
Act expressly keeps alive old rights and liabilities but
whether it :,manifests an intention to destroy them."

and agreeing with the view expressed by Krishnrunurthy Iyer,~ (as he
then was and who is now appearing before µs for the first respondent F
in different capacity) in Civil Revision Petition Nos. 1090 and 1091 of
1972 wherein this precise question crune \1P for consideration hiilci tha.t
)-. the application filed under Section 6 of Act 9 of 1967 which was pend-
I
ing on the date of the commencement of the Act 35 of 1969 was liable
to be continued and dealt with under the prpv'isions of the earlier Act,
untrammelled by the provisions of the later Act. We approve the view G
t.iken in the above Parameswaran Nambudiri's case and hold that the
deposit made in the earlier application under Section 6 of Act 9 of 1967
which was pending on the date of commencement of Act 35 of 1969
was liable to be continued uneffected by \he provisions of the later
Act.
H
558 SUPREME COURT REPORTS [1990] 2 S.C.R

A Jn Summation:

We, for the aforementioned discussion, disagree with the find-
ings of the High Court, set aside the impugned judgment and restore
the judgment of the Trial Court holding that the sale of the 'holdings'
of the appellants was in execution of the decree in O.S. No. 817 /43 for
B arrears of rent and the appellants who are tenants were dispossessed of
the holdings after 1.4.64 and before the commencement of the Kerala
Land Reforms (Amendment) Act, 1969 and the respondents 1 and 2
are not bona fide purchasers for consideration. In view of our above
conclusion the appellants are entitled to recover possession of the
properties in dispute, but without prejudice to the rights, if any, of the
c respondents 7 to 10 who are the wife and children of Gopalan Nambiar
and who have got themselves impleaded as parties to the present pro-
ceedings. The amount under deposit made by the appellants is permit-
ted to be withdrawn by the respondents 1to3.

In the result, the appeal is allowed with costs.

S.B. Appeal allowed.

.-\,