SUPREME COURT OF INDIA
K. JAGANNATHA SHETTY AND R.M. SAHAI, JJ.
Indira Bai, Appellant
Versus
Nand Kishore, Respondent.
Civil Appeal No. 105 of 1990
Decided on 5-9-1990.
Rajasthan Pre-emption Act - Section 8 - Right of pre-emption - Estoppel - Assuming that prior completed purchase by appellant would under other circumstances, have given him the right of pre-emption in respect of blocks in suit, he must be taken by his conduct to have waivea this right, and that it would be inequitable to allow him now to re-assert it - Even in Muslim Law which is genesis of this right, as it was unknown to Hindu Law and was brought in wake of Mohammedan Rule, it is settled that right of pre-emption is lost by estoppel and acquiescence - Estoppel is a rule of equity flowing out of fairness striking on behaviour deficient in good faith - It operates a check on spurious conduct by preventing the inducer from taking advantage and assailing forfeiture already accomplished - It is invoked and applied to aid the law in administration of justice - Held, The Act does not debar pre-emptor from giving up this right - Rather in case of its non-exercise within two months, may be for financial reasons, the right stands extinguished. It does not pass on to anyone - No social disturbance is caused - It settles in purchaser. Giving up such right, expressly or impliedly cannot therefore be said to involve any interest of community or public welfare so as to be in mischief of public policy - Even otherwise on facts found that the respondent knew of sale deed, assisted appellant in raising construction and after the construction was completed in month of June he gave the notice in month of July for exercise of right and filed the suit in January would itself demonstrate that conduct of respondent was inequitable and Courts in this country which are primarily the Courts of equity, justice and good conscience cannot permit respondent to defeat right of appellant and invoke a right which has been called a weak and inequitable right - Appeal allowed.
JUDGMENT
R.M. SAHAI, J.:— Is estoppel a good defence toarchaic, AIR 1986 SC 859, Atam Prakash v. State of Haryana, right of preemption which is aweak right, AIR 1958 SC 838, Bishen Singh v. Khazan Singh, and can be defeated by any legitimate method. AIR 1960 SC 1368, Radha Kishan v. Sridhar.
2. Barring High Court of Rajasthan and erstwhile Mewar State, 1947 Mewar Law Reports 36, Jethmal v. Sajanumal, most of the other High Courts, namely, Allahabad, ILR 39 All 127, Naunihal Singh v. Ram Rati Lal, Oudh, AIR 1947 Oudh 81, Ram Rathi v. Mt. Dhiraji, Ajmer, AIR 1952 Ajmer 26, Gopinath v. R. S. Nand Kishore, Bhopal, AIR 1953 Bhopal 26, Abdul Karim v. Babu Lal, and Lahore, AIR 1938 Lab 273, Kanshi Ram Sharma v. Lahori Ram, have answered the issue in the affirmative. The Privy Council, AIR 1929 PC 259, too, applied this principle to non-suit a pre-emptor who knew that the property was in the market for long but offered to purchase only one out of many blocks. It held:
"Assuming that the prior completed purchase by the appellant would under other circumstances, have given him the right of pre-emption in respect of the blocks in suit, he must be taken by his conduct to have waivea this right, and that it would be inequitable to allow him now to re-assert it."
Even in Muslim Law which is the genesis of this right, as it was unknown to Hindu Law and was brought in wake of Mohammedan Rule, it is settled that the right of pre-emption is lost by estoppel and acquiescence.
3. Estoppel is a rule of equity flowing out of fairness striking on behaviour deficient in good faith. It operates a check on spurious conduct by preventing the inducer from taking advantage and assailing forfeiture already accomplished. It is invoked and applied to aid the law in administration of justice. But for it great many injustice may have been perpetrated. Present case is a glaring example of it. True no notice was given by the seller but the trial Court and appellate Court concurred that the pre-emptor not only came to know of the sale immediately but he assisted the purchaser-appellant in raising construction which went on for five months. Having thus persuaded, rather misled, the purchaser by his own conduct that he acquiesced in his ownership he somersaulted to grab the property with constructions by staking his own claim and attempting to unsettle the legal effect of his own conduct by taking recourse to law to curb and control such unwarranted conduct the Courts have extended the broad and paramount considerations of equity, to transactions and assurances, express or implied to avoid injustice.
4. Legal approach of the High Court, thus that no estoppel could arise unless notice under Section 8 of the Rajasthan Pre-emption Act (in brevity the Act) was given by the seller and pre-emptor should have had occasion to pay or tender price ignores the fallacy that estoppel need not be specifically provided as it can always be used as a weapon of defence. In the Privy Council decision referred earlier, the Court was concerned with Oudh Laws Act (18 of 1876) which too had an identical provision for giving notice by seller. No notice was given but since pre-emptor knew that the property was for sale and he had even obtained details of lots he was precluded from basing his claim on pre-emption.
5. Exception to this universal rule or its non-availability is not due to absence of any provision in the Act excluding its operation but welfare of society or social and general well-being. Protection was, consequently, sought not on the rationale adopted by the High Court that in absence of notice under Section 8 of the Act estoppel could not arise but under cover of public policy. Reliance was placed on Shalimar Tar Products v. H. C. Sharma, AIR 1988 SC 145, a decision on waiver, and Equitable Life Assurance Society of the United States v. Reed, 1914 Appeal Cases 587, which laid down that there could be no estoppel against statute. Equity, usually, follows law. Therefore that which i
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