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2007 Supreme(SC) 1786

SUPREME COURT OF INDIA
S.B. SINHA AND MARKANDEY KATJU, JJ.
Hardev Singh - Appellant
Versus
Gurmail Singh (Dead) by LRs. – Respondents
Civil Appeal No. 6222 of 2000
Decided On : 2-2-2007

Advocates Appeared:
For the Appellant :- A. Mariarputham, Ms. Prathiba M. Singh, Gaurav Sharma and Sumeet Bhatia for Maninder Singh, Advocates.
For the Respondent:- R.K. Kapoor, Mukesh K. Verma and S.S. Yadav for Anis Ahmed Khan, Advocates.

The central legal point established in the judgment is the interpretation and application of Section 43 of the Transfer of Property Act, which governs the transfer of property by an unauthorized person who subsequently acquires an interest in the property transferred.

Headnote:

Transfer of Property Act - Interpretation of Section 43 - Section 43

Fact of the Case:

The case involved a dispute over the ownership of properties transferred in favor of Udham Kaur in lieu of maintenance. The appellant claimed to be a bona fide purchaser for value, while Udham Kaur contended that the properties were purchased during the pendency of a suit and were hit by the 'doctrine of lis pendens'. The appellant also claimed ownership under Sections 41 and 43 of the Transfer of Property Act.

Finding of the Court:

The High Court rejected the appellant's claim under Section 41 but upheld the claim under Section 43, stating that the properties devolved upon the appellant after the death of Udham Kaur.

Issues: The main issues were the applicability of Section 43 of the Transfer of Property Act and the validity of the appellant's claim as a bona fide purchaser for value.

Ratio Decidendi: The court applied the principles of Section 43, emphasizing that a person who fraudulently or erroneously represents that he is authorized to transfer certain immovable property and professes to transfer such property for consideration, the transfer shall operate on any interest which the transferor may acquire in such property at any time during which the contract of transfer subsists.

Final Decision: The court dismissed the appeal, holding that the appellant could not raise the plea of inapplicability of Section 43 and found no merit in the appeal.

JUDGMENT

S.B. Sinha, J. - This appeal raises an interesting question of law in regard to interpretation of Section 43 of the Transfer of Property Act, 1882 ("the Act", for short).

2. Harcharan Singh, the original Defendant No. 1, allegedly transferred some properties in favour of his wife Udham Kaur in lieu of maintenance pursuant to a compromise entered into by and between them. She claimed herself to be the absolute owner thereof in terms of Section 14(1) of the Hindu Succession Act, 1956. She filed a suit against her husband Harcharan Singh for a declaration that she was the owner in possession of the suit land. The learned Trial Judge was of the opinion that as she had been in possession of the property in lieu of maintenance, she was 'entitled to enjoy the fruits thereof only during her life time'. An appeal was preferred thereagainst and the Appellate Court declared her to be the full owner in possession of the suit land. Indisputably, during pendency of the said suit, Harcharan Singh sold the said land to the respondent herein by a deed of sale dated 17.3.1982 and he had been given possession thereof. Another suit was filed by Udham Kaur.

3. The appellant, in the suit, inter alia, raised a plea that he was a bona fide purchaser for value, whereas the case of Udham Kaur was that as the properties were purchased during pendency of the suit, the same was hit by the 'doctrine of lis pendens', as envisaged under Section 52 of the Act. The said contention of the respondent was not accepted by the learned Trial Judge as also by the First Appellate Court holding that the transaction was hit by the doctrine of lis pendens. In the Second Appeal, one additional ground was taken by him, viz., having regard to the death of Udham Kaur, the properties devolved upon the appellant herein as also on Harcharan Singh in equal shares; and, thus, he should be declared to be the owner of the lands in terms of Sections 41 and 43 of the Act.

4. The High Court, although, rejected the contention of the respondent herein that Section 41 of the Act would be attracted, but opined that Section 43 would. Appellant is, thus, before us.

5. Mr. A. Mariarputham, learned counsel appearing on behalf of the appellant took us through the judgment of the High Court and contend that as the bonafide of the respondent was not proved and furthermore in view of the fact that the High Court itself opined that he was not entitled to the benefit of Section 41 of the Act, the judgment of the High Court upholding his claim in terms of the Section 43 thereof cannot be sustained.

6. Mr. R.K. Kapoor, learned counsel appearing on behalf of the respondent, on the other hand, supported the judgment.

7. Although, in this appeal we are not concerned with the applicability of Section 41 of the Act, with a view to appreciate the rival contentions raised by the parties we may notice the provision of both Sections 41 and 43 of the Act, which are as under :

    "41. Transfer by ostensible owner. - Where, with the consent, express or implied, of the persons interested in immoveable property, a person is the ostensible owner of such property and transfers the same for consideration, the transfer shall not be voidable on the ground that the transferor was not authorised to make it : provided that the transferee, after taking reasonable care to ascertain that the transferor had power to make the transfer, has acted in good faith."

    "43. Transfer by unauthorized person who subsequently acquires interest in property transferred. - Where a person fraudulently or erroneously represents that he is authorised to transfer certain immoveable property and professes to transfer such property for consideration, such transfer shall, at the option of the transferee, operate on any interest 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 of the e

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