1956 Supreme(AP) 163
Andhra Pradesh High Court
Vytla Veeraswami - Appellant
Versus
Ivaturi Durga Venkata Subbarao - Respondent
Decided On : 08-10-56
Section 43 of the Transfer of Property Act protects the rights of subsequent transferees in good faith and for consideration without notice of the rights of the prior transferee, even if the subsequent transferee had knowledge of the defect in the transferor's title.
Headnote:
TRANSFER OF PROPERTY ACT - SECTION 43 - SALE OF PROPERTY - REPRESENTATION OF TITLE - KNOWLEDGE OF TRANSFEREE - EFFECT - INTEREST FEEDING ESTOPPEL - APPLICABILITY.
Fact of the Case:
The plaintiff purchased a house and site from defendants 4 and 5 under Exhibit A-2, dated 18th September, 1942. Defendants 1 to 3 claimed title to the property under a sale-deed, Exhibit B-7, dated 8th January, 1943, executed by defendants 4 and 5 in their favour. The plaintiff filed a suit for possession of the property, alleging that Exhibit A-2 was executed prior to Exhibit B-7 and was not ante-dated. The lower courts decreed the suit.
Finding of the Court:
The lower courts found that Exhibit A-2 was not ante-dated but was a true and genuine sale-deed executed on 18th September, 1942, by defendants 4 and 5 in favour of the plaintiff for proper consideration. The court also found that defendants 1 to 3 were bent upon acquiring the suit property and brought into existence documents to defeat the prior sale-deed Exhibit A-2 in favour of the plaintiff.
Issues: 1. Whether Exhibit A-2 was ante-dated and collusively executed to defeat the rights of defendants 1 to 3? 2. Whether the plaintiff was entitled to the entire suit property or only to the half share of his vendors, defendants 4 and 5? 3. Whether section 43 of the Transfer of Property Act applied to the case and enured for the benefit of the plaintiff?
Ratio Decidendi: 1. The court held that Exhibit A-2 was not ante-dated but was a true and genuine sale-deed executed on 18th September, 1942, by defendants 4 and 5 in favour of the plaintiff for proper consideration. 2. The court held that the plaintiff was entitled to the entire suit property, as defendants 4 and 5 had acquired the interest of their brothers Gopalakrishnamurthy and Suryanarayana under Exhibits B-6 and A-7, respectively, and had thus acquired four-fifths share of the property. The one-fifth share of Gopalakrishnamurthy, though it did not vest in them on the date of Exhibit A-2, but was subsequently acquired under Exhibit B-6 on 8th January, 1943, would enure for the benefit of the plaintiff, if section 43 of the Transfer of Property Act applied to the case. 3. The court held that section 43 of the Transfer of Property Act applied to the case, as there was a fraudulent or erroneous representation by the transferors that they were authorised to transfer the property which they professed to transfer, and the transfer was for consideration. The court rejected the argument that the plaintiff's knowledge of the defect in the transferors' title barred him from the benefit of section 43, holding that the transferee's knowledge of the facts relating to title is immaterial under section 43.
Final Decision: The court dismissed the second appeal with costs.
( 2 ) IN order to appreciate the appellants legal contention it is necessary to state the relevant facts. One Ramaswami Somayajulu had four sons, Suryanarayana, sangameswara Dikshitulu, Gopalakrishnamurthy and Viswanadham and the family owned, among other properties, the suit house. On 23rd March, 1939, the four sons of Ramaswami Somayajulu relinquished their interest in favour of their father and became divided from one another. Thereafter Ramaswami Somayajulu died leaving his four sons above mentioned and a widow Seetharamamma, their stepmother. Under Exhibit A-1 dated 1st August, 1942, Seetharamamma sold to her stepsons Sangameswara Dikshitulu and Viswanadham, defendants 4 and 5, her interest in all the properties which belonged to her deceased husband. Under exhibit A-7, dated 21st August, 1942, Suryanarayana the eldest brother gave up his interest in the suit properties and others in favour of the 4th defendant. Exhibit A-7 styled as "deed of partition and relinquishment" was executed for a consideration rs. 100 paid by the 4th defendant to Suryanarayana. On 18th September, 1942, defendants 4 and 5 sold the suit property to the plaintiff for Rs. 500 under Exhibit a-2 with recital that the property belonged to the vendors ancestrally with absolute right and enjoyment. Relying upon Exhibit A-2 the plaintiff filed the present suit for possession of the house and site. Defendants 1 to 3, the 1st defendant being the father of defendants 2 and 3, set up title to the property in themselves under a sale-deed, Exhibit B-7, dated 8th January, 1943, executed by defendants 4 and 5 in their favour. Defendants 1 to 3 pleaded that Exhibit A-2, the sale-deed in favour of the plaintiff, purporting to have been executed on 18th September, 1942, but presented for registration on 16th January, 1943, was really executed by defendants 4 and 5 subsequent to the date of Exhibit B-7 and was collusively ante-dated in order to defeat their rights. Exhibit B-7 was registered on 8th January, 1943, the date of its execution. The finding of both the Courts below is that the sale-deed Exhibit a-2 in favour of the plaintiff was not ante-dated but a true and genuine sale-deed executed on 18th September, 1942, by defendants 4 and 5 in favour of the plaintiff for proper consideration. The lower appellate Court also held that the 1st defendant was somehow bent upon acquiring the suit property which is adjacent to his. own and with this object, brought into existence documents for defeating the prior sale-deed Exhibit A-2 in favour of the plaintiff. This finding is amply supported by the evidence, direct and circumstantial. On this finding it follows that Exhibit A-2 should prevail against Exhibit B-7.
( 3 ) EVEN so it was argued for the appellants that the plaintiff was not entitled to the entire suit property but only to the half share of his vendors defendants 4 and 5, defendants 1 to 3 being entitled to the remaining half share in the events that happened. Before defendants 4 and 5 executed Exhibit B-7 they had acquired the interest of their brothers Gopalakrishnamurthy and Suryanarayana under Exibit b-6 from a lady, Annapurnamma, who, in her turn, had purchased the interest of the two brothers under Exhibit 6-4, dated 13th September, 1942 and Exhibit b-5, dated 20th September, 1942. The brothers as observed by the lower appellate court, had not scruples about selling their property in succession to different people. Though Suryanarayana had executed Exhibit A-7 on 21st August, 1942, giving up his rights in the suit property in favour of the 4th defendant he again professed to sell his intere