KANWAL NAIN AND 3 OTHERS vs FATEH KHAN AND OTHERS

1. ' ZAFFAR HUSSAIN MIRZA, J.-Leave to appeal was granted in this case in order to examine the question whether the High Court, in its provisional jurisdiction under section 115, Code of Civil Procedure, was right in undertaking its own appraisal of evidence in the face of concurrent conclusion of the Courts below, in absence of a jurisdictional error.

2. ' The dispute in this case concerns the two-thirds share in an urban property consisting of a house bearing No, Q/245-246, and shop No, Q1178, 179, 180 situate in Mohallah Marian, Rawalpindi. Fateh Khan, respondent No. 1 herein is the father of Fazal Din and Allahyar, respondents Nos. 2 and 3 respectively ; and the property in question stood in the names of all three in equal shares, it having been purchased by them through a registered sale-deed, dated 17-6-1957.

3. ' In the events that happened, the appellants purchased 2/3rd share of the property from the second and third respondents, by means of two registered sale-deeds of the same date, viz. 16-5- 1973 for a total consideration of Rs, 18,000 leaving the remaining 1/3rd owned by the first respondent, the father.

4. ' On 16-11-1973, the 1st respondent filed a suit in the Court of Civil Judge, 1st Class, Rawalpindi, for a declaration that the sale by the original owner through sale deed-dated 17-6-1957 showing the second and third respondents ostensibly as vendees, was really benami and that he was the real owner/ vendee of the entire property and, therefore, the subsequent sale by his sons through sale- deeds, dated 16-5-1973 in favor of the appellants was invalid conferring no title upon them. In this suit the 1st respondent also impleaded, his sons the 2nd and 3rd respondents but they did not defend the suit. The appellants, however, contested the suit and denied the claim by the 1st respondent claiming title to the property to the extent of 2/3rd share as bona fide purchasers for value without notice of any defect in the title by the vendors.

5. ' At the trial, several, issues were framed on the pleadings of the parties, but the controversy between the parties, was reduced to the following two issues :-

(3) Whether defendants Nos. 1 and 2 (Respondents No, 2 and 3 herein) were benami owners of the property in question 7

(4) If issue No, 3 above is answered in the affirmative, whether the defendants Nos. 3 to 6 (Appellants herein) are bona fide vendees of the property in question for value and without notice ?

6. ' The trial Court gave a finding on the third issue in favour of the 1st respondent, holding him as the real owner of the entire property. But on the fourth issue, it held in favour of the appellants, that they were bona fide purchasers for value without notice of the title of the 1st respondent and further held that title to the extent claimed by them stood conveyed to them, by virtue of section 41 of the Transfer of Property Act, 1882. The suit was accordingly dismissed on 22-10-1977.

7. ' The finding of the trial Court on the fourth issue was affirmed by the Additional District Judge, Rawalpindi, in an appeal filed by Fateh Khan which was dismissed on 9.9-1979. However, upon a revision application of Fateh Khan, a learned Single Judge of the Lahore High Court, Lahore, upset the concurrent finding recorded by the Courts below, on a reexamination of the evidence on record and reached the conclusion that the appellants had not acted with reasonable care in acquiring property from respondents Nos. 2 and 3. By judgment, dated 17-11-1980, the revision of the first respondent was accordingly accepted by the High Court. Hence this appeal by special leave.

8. ' Learned counsel appearing in support of this appeal strenuously assailed the finding of the trial Court on the third issues between the parties whereby it was held that respondents Nos. 2 and 3 were only benami purchasers in the first sale, dated 17-6-1957 and that Fateh Khan was the real owner of the whole property. However, we cannot allow the appellants to agitate this question at this stage, as the controversy between the parties has all along, except in the trial Court, remained confined to the question whether the appellants were bona fide purchasers for value of the property from respondents Nos. 2 and 3 as ostensible owners and whether they are entitled to take protection of the beneficial provisions of section 41 of the Transfer of Property Act. Further no cross- objection seems to have been filed by the appellants to challenge the finding on this issue, in the appeal filed by Fateh Khan seeking to A challenge the decree passed by the trial Court. The finding on this issue has, therefore, attained finality and is not liable to be re-opened at this stage.

9. ' Now section 41 of the Transfer of Property Act, may with advantage be set out below :- "41. Transfer by ostensible owner.-Where, with the consent, express or implied, of the persons interested in immovable 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 the transferor had power to make the transfer, has acted in good faith."

10. ' Mulla has pointed out that the foundation of this section is the following passage from the judgment of the Judicial Committee in Ramcoomar v. Macqueen :- "It is a principle of natural equity which must be universally applicable that, where one man allows another to hold himself out as the owner of an estate and a third person purchases it, for value, from the apparent owner in the belief that he is the real owner, the man who so allows the other to hold himself out shall not be permitted to recover upon his secret title, unless he can overthrow that of the purchaser by showing either that he had direct notice, or something which amounts to constructive notice, of the real title ; or that there existed circumstances which ought to have put him upon an inquiry that, if prosecuted, would have led to a discovery of it."1 The section is a statutory application of the law of estoppel and makes as exception to the rule that a person cannot confer a better title than he has.IB The principle underlying the provisions of the section is "whenever one of the two innocent persons has to suffer by the act of a third person be whol has enabled the third person to occasion the loss must sustain it."

11. ' As rightly mentioned by the learned Additional District Judge in his judgment, following conditions are necessary for the application of the section, namely :-

(i) the transferor is the ostensible owner ;

(ii) he is so by the consent, express or implied, of the real owner

(iii) the transfer is for consideration ;

(iv) the transferee had acted in good faith, taking reasonable care to ascertain that the transferor had power to transfer.

12. ' There is no dispute between the parties that the first three conditions were duly satisfied in the facts of this case, ither admittedly or by proof on record. The Controversy centred on the fourth condition, namely, whether the appellants acted in good faith and after taking reasonable care to ascertain the title by the two respondents from whom they obtained the transfer. In this behalf the trial Court reached the finding in favour of the appellants on the following circumstances :-

(1) Respondents Nos. 2 and 3 remained as owners of the property for 16 years before the impugned transaction ;

(2) during this long period Fateh Khan remained silent and suffered the property to be shown ostensibly in the ownership of the said respondents ;

(3) the fact that these respondents were only benamidars and not the real owners, was known to Fateh Khan and them only and not the world at large ; and

(4) the property was continuously shown to .Be in the ownership of respondents Nos. 2 and 3 in the official record of all concerned departments all along.

13. ' The conclusion reached by the trial Court was affirmed in appeal by the learned Additional District Judge, who further found that the conveyance through which the respondents acquired title to the property expressly narrated that the consideration was paid by respondent Fazal Din and that appellants purchased the same after verifying their title. The learned Single Judge in the High Court, however, disagreed with the concurrent finding of the Courts' below by drawing the contrary inference from the evidence, mainly on the admission of the guardian of the minor appellants, Kasera Ram, that the parties belonged to the same beradari and that Fateh Khan proved to be in exclusive possession of the property as also that he rented out part of it to tenants. In this regard the learned Judge observed :- "If the vendees had known the entire family and also the fact that at the time of purchase of the property by the petitioner on 17-6-1957 they were minors and had no source of income, it cannot be said that they acted with reasonable care as required under Condition No, 4 cited above."

14. We regret to note that the inferences drawn by the learned Judge are wholly unfounded and proceed upon assumptions not supported by record 0 or pleadings of parties. There is nothing in the plaint even remotely suggesting that the appellants had knowledge of the status of respondents Nos. 2 and 3 as benamidars and not real owners. Having regard to the nature of the suit and the fact that the property continued to be held ostensibly in the official record, including the registered deed, to the extent of 2/3rds share in the names of the said respondents, it was a material plea to be taken in the plaint, that the appellants had notice of the factum of real ownership as vesting exclusively in Fateh Khan. Further no question was put to Kasera Ram that this fact was in the knowledge of the appellants. Yet the learned Judge, without adhering to the fact that the consideration was shown to have been received from respondent No, 2, proceeded to infer only from the fact that parties belong to the same beradari, that the appellants must be held to have had knowledge of the title of Fateh Khan. In coming to this conclusion the learned Judge, unfortunately did not take into consideration the other E weighty evidence of circumstances on record which formed the basis of the finding recorded by the Courts below.

15. ' The learned Judge further observed that the property was "admittedly" in exclusive possession of Fateh Khan, which assumption does not appear to be sustainable by record. The appellants, neither in their pleading nor in the evidence admitted this fact. It was asserted by the appellants in their evidence that the rent for the property was being received by respondents Nos. 2 and 3. Be that as it may, even if it is assumed that Fateh Khan was in the possession and enjoyment of the property, in view of the fact that the property was shown to be in the joint ownership of all three respondents, this circumstance was not inconsistent with the right of co-ownership of the respondents in question, because of the close relationship between the respondents, in absence of evidence in the nature of ouster which is totally lacking in this case. Mere fact, therefore, even if it is held to have been sufficiently established, that Fateh Khan used to rent out the property, is hardly sufficient to hold as notice of his exclusive ownership in the contexts of other circumstances of this case.

16. ' Clearly the decision of the learned Single Judge, impugned in this appeal, turns on the determination of a question of fact. As pointed out by this Court in Muhammad Umar Beg v. Sultan Mahmood Khan revisional powers under section 115, Civil Procedure Code are primarily intended for correcting errors made by subordinate Courts in the exercise of their jurisdiction. Also ordinarily erroneous decisions of fact are not revisable, except in cases where the decision is based on no evidence or inadmissible evidence or is so perverse that grave injustice would result therefrom. In this regard I am tempted to' cite here the illuminating observations of their Lordships of the Privy Council in Venkatagiri v. H. R. E. Board, Madras , which has been followed by this Court in Umar Dad Khan v. Tila Muhhmmad Khan :- "In Mohunt Bhagwan Ramanuj v. Khetter Moni Dassi 1 C W N 617 the High Court of Culcutta expressed the opinion that subsection (c) of section 115, C. P. C,, was 'intended to authorise the High Courts to interfere and correct gross and palpable errors of subordinate Courts, so as to prevent gross injustice in non-appealable cases'. This passage was dissented from by the Calcutta High Court in Enat Mondul v. Baloran? Dey 3 C W N 581, but was cited with approval by Lord Williams, J. In Gulabehand v. Kabiruddin 58 Cal. 11= AIR 1931 Cal.

27. Their Lordships can see no justification for any such view ; it would indeed be difficult to formulate any standard by which the degree of error of subordinate Courts could be measured.

17. Section 115 applies only to cases in which no appeal lies, and, where the Legislature has provided no right of appeal, the manifest intention is that the order of the trial Court, right or wrong, shall be final. The section empowers the High Court to satisfy itself upon three matters, (a) That the order of the subordinate Court is within its jurisdiction ; (b) that the case is one in which the Court ought to exercise jurisdiction ; and (c) that in exercising jurisdiction that Court has not acted illegally, that is, in breach of some provision of law, or with material irregularity, that is, by committing some error of procedure in the course of the trial which is material in that it may have affected the ultimate decision. If the High Court is satisfied upon those three matters, it has no power to interfere because it differs, however profoundly from the conclusions of the subordinate Court upon questions of fact or law. No such matters arose in this case, and the order of the High Court upon the petition was without justification."

18. The above enunciation of the scope of the revisional powers vesting in the High Court clearly shows that, no interference was called for in this case and in upsetting the conclusion of the Courts below on the question of fact by means of a re-examination of the evidence in revision the High Court unfortunately overstepped the limits of its jurisdiction.

19. ' For all the aforementioned reasons, the impugned judgment is not sustainable and is hereby set aside. In the result the appeal succeeds and is hereby allowed with costs.2 3 4