Judgment :- This is an appeal by the second defendant in the suit. At the time of admission, notice was issued on the following questions of law. 1. Whether the courts below were right in giving a decree to the plaintiff, when, on their own finding be was dispossessed as early as 5-4-1966 long before Act 1 of 1964 came into force and he was not a tenant on 1-1-1970. 2. Whether a suit for recovery of possession on title is maintainable at the instance of the plaintiff after his application for redelivery under S. ISA of Act 1 of 1964 has been dismissed. 3. Whether the plaintiff who claims to be inducted into possession as a lessee during the pendency of the suit, OS.No. 397 of 1941 can resist re-delivery of possession when the decree itself was set aside and redelivery was ordered in EP. 29/59? 2. The learned counsel for the appellant did not advance any argument on the above questions. The main question of law he raised and argued is whether a lessee of a decree-holder auction purchaser can validly resist the claim for restitution by the judgment debtor when the decree on the basis of which sale was effected is subsequently set aside and the general question whether the assignee of the decree holder court auction purchaser will be affected by the subsequent reversal of the decree. The further question which has arisen in the case is that, in view of the judgment in S. A. No. 482 of 1973 by this court, which remanded the case to the trial court for permitting the plaintiff to amend the plaint as indicated in the judgment and then to dispose of the suit in accordance with law and in the light of the findings and observations in the judgment, whether the appellant can now validly contend that the assignee (lessee) from the decree holder auction purchaser is not entitled to the same protection as that of a stranger purchaser in a judicial sale. I may now at once say that Viswanatha Iyer, J. held in his judgment in S.A. No. 482 of 1973 remanding the case that an assignee from a decree holder auction purchaser is entitled to the same protection as that of a stranger auction purchaser in a court sale. 3.
I may now at once say that Viswanatha Iyer, J. held in his judgment in S.A. No. 482 of 1973 remanding the case that an assignee from a decree holder auction purchaser is entitled to the same protection as that of a stranger auction purchaser in a court sale. 3. Though the questions of law argued before me were not raised at the time of admission, I allowed the counsel to argue the questions raised by him considering the fact that those questions are really questions that can be canvassed in the appeal. To answer the question now raised by the learned counsel, I feel that I should examine first the distinctive nature of a judicial sale. The fundamental fact in a judicial sale is that it is a sale effected under the process of a court having competent power to order it, by a person legally appointed and commissioned to sell, which is subject to confirmation by the court. If we examine the nature of that sale, the first and foremost fact that has to be noted significantly is that it is an involuntary sale made by the court wherein the court is acting as the vendor through an agent (officer of the court) conducting the sale. 4. It is axiomatic that in the absence of statutory restrictions courts are inherently-vested with the broad discretionary powers with respect, to the method and mode of judicial sales, but the legality and the validity of a particular sale depends on the court's power to order sale in that case and in jurisdiction over the subject-matter and the parties. As I said that it is an involuntary sale, the object of which is to procure an amount which is approximately the value of the property in question. In my view, such a sale is a contract in that it is the result of an offer on one part, and its acceptance on the other and there is nothing wrong in considering that the court ordering the sale as the contracting party on the one side and the bidder on the other. It is plain that the distinctive character of a judicial sale is that it is the end result of a judicial proceeding.
It is plain that the distinctive character of a judicial sale is that it is the end result of a judicial proceeding. it must have the backing and support of a judicial order, decree or judgment directing that the property be sold as distinguished from a judicial assent to the sale of the property under statutory provisions authorising such sale under the supervision of courts or by its direction upon the terms and in the mode providing in certain statutes. 5. It may not be wrong for me to assume that it is the policy of the court to uphold and protect such sales wherever possible. S.60 CPC. grants the power to court to order sale of properties in execution of a decree belonging to a judgment debtor or over which, or the profits of which, the judgment-debtor has a disposing power which he may exercise for his own benefit whether the same be held in the name of the judgment-debtor or by another person in trust for him or on his behalf. Of course, S.60 also makes it clear that the court has no power to effect a sale in execution of a decree in regard to certain specified properties. Further in Order XXI Rule 64 CPC., it is provided that any court executing a decree may order that any property attached by it and liable to sale, or such portion thereof, as may deem necessary to satisfy the decree, shall be sold, and that the proceeds of such sale, or a sufficient portion thereof, shall be paid to the party entitled under the decree to receive the same. I have now stated the distinctive nature of a judicial sale in execution of a decree so that it will serve as a backdrop when I discuss the true nature of the title. 6. The question I have to decide is whether a bona fide purchaser for value from a decree-holder auction purchaser in a judicial sale has got any protection afforded by the courts when restitution in specie has to be ordered under S.144 CPC. There is no dispute now, that a stranger who directly purchases property in a court auction is protected even if the judgment and decree which necessitated the sale have been vacated or reversed. This proposition is firmly established by the Privy Council decision reported in Zain-Ul-Abdin-Khan v. Muhammad Asghar Ali Khan (ILR.10 All. 166).
There is no dispute now, that a stranger who directly purchases property in a court auction is protected even if the judgment and decree which necessitated the sale have been vacated or reversed. This proposition is firmly established by the Privy Council decision reported in Zain-Ul-Abdin-Khan v. Muhammad Asghar Ali Khan (ILR.10 All. 166). It is well settled that there is a great distinction between the decree holders who came and purchased under their own decree which was afterwards reversed in appeal and the bona fide purchasers who came in and bought at the sale in execution of the decree to which they were not parties, and at a time when that decree which was then the stercobate of the sale was a valid decree, and when the order for the sale was a valid order. The Privy Council quoted Bacon's Abridgement, Title "Error", where it is laid down citing old authorities that "if a man recovers damages, and hath execution by fieri facias, and upon the fieri facias the sheriff sells to a stranger a term for years and after the judgment is reversed, the party shall be restored only to the money for which the term was sold, and not to the term itself, because' the sheriff had sold it by the command of the writ of fieri facias." The Privy Council held thus: "So in this case, those bona fide purchasers, who were no parties to the decree which was then valid and in force, had nothing to do further than to look to the decree and to the order of sale." 7, It cannot be doubted that the title conveyed to a decree bolder auction purchaser and stranger auction purchaser in a judicial sale is one and the same. But clearly a marked difference is recognised in law between these two classes of persons in the matter of restitution. It is difficult to discern the reason for it in any difference in the title acquired by these two classes of auction purchasers. So the reason for the distinction has to be found out elsewhere. 8. The learned counsel for the appellant pointed out that the Privy Council has treated the decree-holders auction purchasers and purchasers from decree holders auction purchasers as one class and stranger auction purchasers another class.
So the reason for the distinction has to be found out elsewhere. 8. The learned counsel for the appellant pointed out that the Privy Council has treated the decree-holders auction purchasers and purchasers from decree holders auction purchasers as one class and stranger auction purchasers another class. Of course in the case decided by the Privy Council, no question relating to the validity of purchases made by persons who purchased the property from decree-holders auction purchasers had not come up for consideration or decision. But the counsel would rely on one passage from the Privy Council decision as the foundation of his argument. The passage runs thus: "Some of the defendants were the decree-holders, and some were persons who came in under them; but all the defendants who are in that position may for the purpose of this judgment be classed under the head of the decree-holders. Others of the defendants were not decree holders, but merely purchasers under the execution and strangers to the decree upon which the execution issued." It is plain that strangers who purchased the property directly in court auction is certainly protected. The learned counsel for the respondent submits that there is no distinction between persons who purchased the property in court auction directly from court and persons who purchased property bona fide for value from decree-holders auction purchasers since both of them mainly relied on the title that has been conveyed by the court, in the court sale. I feel that the question is not free from doubt. This Court in two single bench decisions has taken a view on this matter. The learned counsel for the appellant submits that the view taken by this court is wrong and requires reconsideration. I shall examine the question. 9. This court has now taken the view that the stranger purchaser from court and a purchaser from decree-holder auction purchaser (of course both of them must be bona fide purchasers) can be considered on a par in the matter of restitution by the judgment debtor of the property in specie. But the Calcutta High Court has consistently taken the view that the decree holder auction purchasers and persons who come under them should be treated alike. They cannot be equated to stranger purchasers directly under the execution sale and strangers to the decree upon which the execution issued. 10.
But the Calcutta High Court has consistently taken the view that the decree holder auction purchasers and persons who come under them should be treated alike. They cannot be equated to stranger purchasers directly under the execution sale and strangers to the decree upon which the execution issued. 10. The Madras and Patna High Courts have taken the same view that this court has taken. 11. The learned counsel for the appellant elaborately argued the case and wanted me to consider the correctness of the view taken by this court. The decisions that have to be considered on this questions are ILR.10 Allahabad,166 AIR. 1915 Calcutta 363, AIR. 1916 Calcutta 710, AIR. 1920 Calcutta 550, AIR. 195.4 Patna 36, AIR. 1964 Madras 404, 1970 K.LJ. 458 and the decision in S. A. No. 482 of 1973, AIR. 1953 SC. 136 and AFR.1966 SC. 948. 12. In Binayak Swain v. Ramesh Chandra (AIR. 1966 SC. 948) raroa-swamy, J. said:-"The principle of the doctrine of restitution is that on the reversal of a decree, the law imposes an obligation on the party to the suit who received the benefit of the erroneous decree to make restitution to the other party for what he has lost and the Court in making restitution is bound to restore the parties so far as they can be restored to the same position they were in at the time when the Court by its erroneous action had displaced them from." The Court has relied on ILR.10 All. 166 and observed: "The view that we have expressed is borne out by the decision of the Judicial Committee in Zain VI.
166 and observed: "The view that we have expressed is borne out by the decision of the Judicial Committee in Zain VI. Abdin Khan v. Muhammad' Asghar All Khan (1888) ILR 10 All 166 (PC) in which a suit was brought by the judgment-debtor to set aside the sale of his property in execution of the decree against him in force at the time of the sales, but afterwards so modified, as the result of an appeal to her Majesty in Council, that, as it finally stood, it would have been satisfied without the sales in question having taken place." The case that was considered by the Supreme Court was a direct case where the question presented was whether the appellant was entitled to restitution of his property purchased by the decree-holder in execution of the decree passed by the District Judge on the ground that the decree was set aside by the High Court and the suit was remanded for re-hearing and fresh disposal under S.144 of the Civil Procedure Code. 13. Much reliance has been placed on the decisioo-Satis Chandra Ghose v. Rameswari Dasi (AIR. 1915 Calcutta 363) by the learned counsel for the appellant. A Division Bench of the Calcutta High Court held in this case that the defeasibility of the decree-holder's title to the property purchased is execution of an ex parte decree is of such common occurrence that the plea of a purchaser for value without notice hardly applies to his assignee. Further the court observed relying on the dictum laid down by Sir Barnees Peacock in the decision of the Privy Council thus: "It is on the strength of this distinction between those who are and those who are not decree-holders that the decision went in favour of the latter. This appears to me 10 be the result of the language employed by their Lordships, and I am unable to accede to the argument that the result is so opposed to legal principles that we ought not to give complete effect to that language used. The court as a matter of policy has a tender regard for honest purchasers at sales held in execution of its decrees though the sales may be subsequently set aside, where those purchasers are not parties to the suit and the decree has not been passed without jurisdiction.
The court as a matter of policy has a tender regard for honest purchasers at sales held in execution of its decrees though the sales may be subsequently set aside, where those purchasers are not parties to the suit and the decree has not been passed without jurisdiction. But the same measure of protection is not extended to purchasers who are themselves the decree-holders; nor can the purchasers from such decree-holders claim that the court owes them any duty, or to be within the policy which prompts the extension of protection to strangers." The learned counsel for the appellant submits that the title acquired by the purchaser from the decree holder is tainted with the same vitiating factor and the title is defeasible when the decree under which the sale has been effected has been vacated. 14. Now I shall refer to AIR. 19)6 Calcutta 710 and AIR. 1920 Cal.550 ATR.1916 Calcutta 710 is also a decision by a Division Bench. Chatterjee, J. who was a party to AIR. 1915 Calcutta 363, was one of the judges who constituted the Division Bench. This decision only reiterate the principle laid down in AIR. 1915 Calcutta 363. The court observed: - "As fully explained by Jenkins C.J. in Satis Chandra Ghose v. Rameswari Dasi (AIR. 1915 Cal. 363), the assignee stands in no better position than his assignor." It has to be noted that this bench of the Calcutta High Court is definite that the above said proposition is supported by the decision of the Judicial Committee in 10 A1.166. In AIR. 1920 Cal 550 (Sagora v. Mofijuddin), relying on the earlier decisions, AIR. 1915 Cal. 363 and AIR. 1916 Cal. 710 and also 10 All 166, the Division Bench consisting of Chatterjee and Newfound, JJ. held that "where a decree-holder himself purchases land in execution of his decree, be must lose the benefit of the purisms on the reversal of the decree under which the sale took place. An assignee from such a decree-holder or a person with whom the land i<< settled by such decree-holder purchaser is in no better position." 15. The learned counsel for the respondent submitted that a careful examination of the decision of the Privy Council would certainly indicate that the observation of the Division Bench of the Calcutta High Court that the principle stated in 1915 Cal 363 and 1916 Cal.
The learned counsel for the respondent submitted that a careful examination of the decision of the Privy Council would certainly indicate that the observation of the Division Bench of the Calcutta High Court that the principle stated in 1915 Cal 363 and 1916 Cal. 710 is deducible from the decision of the judicial committee is not correct He submits that Poti, J, as he then was, in 1970 KLJ 458 and Viswanatha Iyer, J. in S. A. No 482 of 1983 and Ramamurti, J. in AIR. 1964 Madras 404 had examined this aspect of the question very carefully and said that the Privy Council decision is of no assistance to support the proposition that the decree holder auction purchaser and a purchaser from decree holder auction purchaser should be treated alike in the matter of restitution. 16. To clear the grounds, I think I have to examine first whether the reliance placed by the Calcutta High Court on the Privy Council decision reported in 10 All. 166 for the proposition laid down in AIR. 1915 Cal. 363 and 1916 Cal. 7JO is justified or not. In this context it is necessary to have a clear and precise picture of the factual format of the case under 10 All. 166 for understanding the true ratio of that decision. The Privy Council case reveals these facts. Several items of properties of a judgment-debtor were sold in execution of a decree. That decree was an ex-parte decree. Some items of properties were purchased by the decree-holder. Some other items were purchased by strangers. Subsequently the decree-holder transferred some of the items purchased by him to strangers. The ex-parte decree was set aside. The judgment debtor commenced proceedings to cancel all the auction sales and wanted restitution of the property sold in execution. In that proceedings the judgment-debtors impleaded the decree-holder purchaser, the purchaser from him and stranger purchasers as parties. The court which considered the proceedings for restitution directed restitution as against all of them without making any distinction between the three sets of defendants, namely stranger purchasers, the decree-holder auction purchaser and purchasers from the decree-holder auction purchaser. The stranger purchasers who were bona fide purchasers from court in the execution sale alone took up the matter in appeal to the High Court.
The stranger purchasers who were bona fide purchasers from court in the execution sale alone took up the matter in appeal to the High Court. The High Court reversed the decision of the trial court and passed a decree negative the claim of the judgment-debtors for restitution. The judgment-debtor preferred an appeal to the judicial committee to which the aforesaid stranger purchasers alone were parties. The Privy Council confirmed the judgment of the High Court on the ground that when an auction sale had duly taken place in execution of a decree which was alive at the time of sale, and the fact that it was afterwards set aside, would not enable the judgment-debtor restitution as against a stranger bona fide purchaser. It has to be noted that purchasers from decree-holder auction purchaser were not parties at all before the Privy Council. The only question decided by the Privy Council in my view is that the principle of restitution in regard to a decree-holder auction purchaser is not applicable to a stranger auction purchaser who purchased the property directly from court. Nothing more is deducible from that judgment and I am not prepared to subscribe to the view that the Privy Council will lay down a principle which would affect a class of purchasers namely purchasers from decree-holders auction purchasers without at least the presence of a representative of that class before it and when that question was not before the Privy Council. It has to be noted that the Privy Council very distinctly made it clear that their Lordships' decision affirming the decrees of the High Court confined to the decrees in favour of the defendants who are appellants in the High Court. The appellants in the High Court, as I said earlier, were only stranger purchasers. The Privy Council said thus: "Their Lordships wish it to be distinctly understood that in affirming the decrees of the High Court they treat them merely as decrees in favour of the defendants who were appellants to the High Court." What I quoted above, according to roe, is capable of dispelling any doubt that may arise on the question whether the Privy Council has considered the case of purchasers from decree-holder auction purchaser. 17.
17. This analysis of the facts of the Privy Council case is sufficient for me to say that the reliance placed on the Privy Council decision by the Calcutta High Court is not very correct. I may quote here what is quoted from Privy Council in AIR. 1915 Calcutta 363. "Some of the defendants were decree-holders and some were persons who came in under them; but all the defendants who are in that position may for the purpose of this judgment be classed under the head of the decree holders. Others of the defendants were not-decree-holders, but merely purchasers under the execution and strangers to the decree upon which the execution issued." ;...;.-. The Division Bench of the Calcutta High Court, after quoting this passage said that this passage is important and the rest of the opinion must be read in the light of the extended meaning it gives to the word "decree-holders". I do not think that the Calcutta High Court decisions can have the support and assistance of the Privy Council decision. 18. Before further considering the question, I shall now quote S.144 of the Code of Civil Procedure, the statutory provision, which provides for restitution. "144. Application for restitution.- (1) Where and in so far as a decree or an order is varied or reversed in any appeal, revision or other proceeding or is set aside or modified in any suit instituted for the purpose, the Court which passed, the decree or 'order shall on the application of any party entitled to any benefit by way of restitution or otherwise, case such restitution to be made as will, so far as may be. place the parties in the position which they would have occupied but for such decree or order." No doubt this section tells us that it is a rule of equity. I should remember that equity delights to do complete justice and not by halves-complete justice to all the parties concerned. The court should act rightly and fairly according to the circumstances towards all parties involved. 19. If we go to the history of this section, we can see that the Code of Civil Procedure, 1859, did not provide a provision for restitution.
The court should act rightly and fairly according to the circumstances towards all parties involved. 19. If we go to the history of this section, we can see that the Code of Civil Procedure, 1859, did not provide a provision for restitution. But the principle of restitution was considered by the judicial Committee in Shama Purshad Roy Chowdhry v. Hurro Purshad Roy Chowdhry (10 Moo Ind App 203 at p. 211) wherein it is stated thus: "this rule of law rests, as their Lordships apprehend, upon this ground, that the original decrees or judgment must be taken to be subsisting and valid until it has been reversed or superseded by some ulterior proceeding, If it has been so reversed or superseded, the money recovered under it ought Certainly to be refunded, and, as their Lordships conceive, is recoverable either by summary process, or by a new suit or action." The Civil Procedure Code, 1882 introduced S, 583 providing for restitution. That section reads: "When a party entitled to any benefit, by way of restitution or otherwise, under a decree passed in an appeal under this chapter desires to obtain execution of the same, he shall apply to the Court which passed the decree against which the appeal was preferred; and such Court shall proceed to execute the decree passed in appeal, according to the rules hereinbefore prescribed for the execution of decree in suits." The legal position under S.583 of the Code of Civil Procedure was considered by the Supreme Court in Mahijibhaiv, Manibhai (ATR.1965 SC. 1477) thus: - "The legal position under S.583 of the Code of Civil Procedure, 1882 may be stated thus: The benefit accrued to a party under an appellate decree could be realised by him by executing the said decree through the Court which passed the decree against which the appeal was preferred. The appellate court which set aside or modified the decree of the first Court could give a direction providing for restitution. Even if it did not expressly do so, it should certainly be implied as the appellate court could not have intended otherwise. The setting aside of the decree itself raised the necessary implication that the parties should be restored to their original position. Be that as it may, Courts understood the provision in that light and held that such a decree was executable as if it contained such a direction.
The setting aside of the decree itself raised the necessary implication that the parties should be restored to their original position. Be that as it may, Courts understood the provision in that light and held that such a decree was executable as if it contained such a direction. Such an application was governed by Art.179 of the Limitation Act, 1908 corresponding to Art.182 of the present Act. No suit lay for the relief of restitution in respect of such a benefit, the same being held by the Privy Council to be barred by S.244 of the Code of Civil Procedure, corresponding to the present S 47 of the Code. But the terms of the section were only confined to a party entitled to a benefit by way of restitution or otherwise under a decree passed in an appeal and not under any other proceeding." 20. The scope of S.144CPC, has been succinctly pointed out by the Privy Council in Jai Berham v. Kedar Nath Marwari (AIR. 1922 PC. 269 at 271) thus: - "It is the duty of the Court under S.144 of the Civil Procedure Code to place the parties in the position which they would have occupied, but for such decree or such part thereof as has been varied or reversed. Nor indeed does this duty or jurisdiction arise merely under the said section. It is inherent in the general 'jurisdiction of the Court to act rightly and fairly according to the circumstances towards all parties involved." 21. I shall quote here the English Law on the subject from Halsbury's Laws of England: - "Title acquired by purchaser. A sale by the Sheriff is not a sale in market overt, but where any goods in the execution debtor's possession at the time of seizure by the sheriff are sold by the sheriff without any claim having been made to them the purchaser acquires a good title, subject to the right of any person who may prove that at the time of the sale he had a good title to any of the goods to any remedy to which he may be entitled against the purchaser.
A purchaser in good faith from the sheriff is entitled to the same protection as any other purchaser in good faith against other executions which should have had priority, even if the writ under which the sale was held is void as being under a fraudulent judgment. After the sale it was formerly usual for the sheriff to give the purchaser a bill of sale of the property purchased, but this is not necessary to the validity of the sale, and is not now given nor need the usual receipt enumerating the goods be registered as a bill of sale." 22. Before further considering the case of purchaser from a decree-holder auction purchaser, I shall consider why in the case of a stranger auction purchaser, the judgment debtor is not allowed to obtain restitution of the property. In Rewa Mahton v. Ramkrishna Singh (ILR.14 Cal. 18 at page 25). Their Lordships of the Privy Council said that "a purchaser under a sale in execution is not bound to inquire whether the judgment-debtor had a cross judgment of a higher amount any more than he would be bound in an ordinary case to inquire whether a judgment upon which an execution issues has been satisfied or not". Those are questions to be determined by the Court issuing the execution. To hold that a purchaser at a sale in execution is bound to enquire into such matters would throw a great impediment in the way of purchases under executions. If the court has jurisdiction, a purchaser is no more bound to enquire into the correctness of an order for execution than be is as to the correctness of the judgment upon which the execution issues." In short, if the purchaser were to lose the benefit of his purchase on the contingency of the subsequent reversal of the decree, there will be no inducement to the intending purchasers to buy at execution sale the sale being a precarious sale, and consequently the property would not fetch its proper price at such sales and the net result would be that the judgment-debtor would be the ultimate sufferer. So it was necessary to protect the title of the stranger-purchaser 23.
So it was necessary to protect the title of the stranger-purchaser 23. The learned counsel for the appellant submitted that in the case of a purchaser from a decree-holder auction purchaser the rule that has to be applied is the general rule that 'no man can transfer a better title than what he has' of course, barring certain specified exceptions contained in some of the statutes and under certain peculiar circumstances accepted in law. He submits that the case at hand will not invite any such exceptions to the general rule. He elaborates his argument by saying that in the light of the Privy Council decision it can he said in unmistakable terms that the decree-holder auction purchaser is getting a title which is precarious insofar as it is subject to the final result of the litigation between the decree holder and the judgment debtor. With understandable enthusiasm, the learned counsel asks, how can such a decree holder convey a better or higher title than the title he had with him at the time of transfer. Upon the able presentation of the counsel for the appellant, it may appear to be a very attractive argument. But on a closer examination, it can be seen that submission of the counsel is not very correct. If we consider in the light of the nature of a judicial sale and in the background of the provision enacted in S.144 CPC., the question has to be considered in a slightly different angle. 24. The counsel. Mr. Warrier, emphatically submitted that the protection which is extended to a stranger purchaser would apply undeviatingly and faithfully, whether the stranger is one who directly purchases in execution sale or one who bona fide purchases the property without notice from the decree holder purchaser for valuable consideration. I shall examine this aspect now. 25. At the time when the sale took place, there was a valid enforceable decree. The sale was effected by the court which had ample power to sell the property. A valid title no doubt has been clearly conveyed to the decree-holder purchaser. That title which the decree-holder obtained is a valid title. It has no defect at all at any time. The title that has been conveyed to the decree-holder auction purchaser was not subject to any limitation or any infirmities.
A valid title no doubt has been clearly conveyed to the decree-holder purchaser. That title which the decree-holder obtained is a valid title. It has no defect at all at any time. The title that has been conveyed to the decree-holder auction purchaser was not subject to any limitation or any infirmities. A claim by the judgment-debtor for restitution in the event of reversal or modification of decree cannot be considered as a defect in the title of the purchaser and that to my mind, it appears that the rule that "no man can convey a better or higher title than what he has' is not the rule that has to one applied in regard to a question of restitution of the property by the judgment-debtor, under S.144 CPC. from a purchaser from decree-holder auction purchaser. It has to be understood that the provision made in S.144 CPC. is mainly intended to work out the equities between the judgment debtor decree holder and purchasers in execution of the decree. It has to be noted that the section only authorises 'restitution to be made as will so far as may be'. So it is clear that in considering the question whether the property has to be restored back to the judgment-debtor all the equities in the case with reference to all the parties who will be affected by the order of restitution have to be considered. In that in considering the equities an innocent bona fide purchaser who has paid consideration for his purchase believing that the decree-holder had obtained a wood title (a fact which remained always correct) cannot be told that he did not obtain a good title from the decree holder when the judgment and decree had been set aside or reversed. As I said earlier, the right 6f a judgment debtor for restitution in specie is not an absolute right but, is restricted by other equitable considerations and certainly one of which is that consideration which has to be shown to a bona fide third party purchaser. Equity favours a purchaser for value without notice. 26. Now I shall refer to the decisions relied on by the counsel for the respondent. In Parameswaran Pillai v. Chinna Lakshmi (1970 KLJ. 458) Poti, J., as he then was, considering the Calcutta decisions and ILR.10 All.
Equity favours a purchaser for value without notice. 26. Now I shall refer to the decisions relied on by the counsel for the respondent. In Parameswaran Pillai v. Chinna Lakshmi (1970 KLJ. 458) Poti, J., as he then was, considering the Calcutta decisions and ILR.10 All. 166, held that though it is clear from the authoritative pronouncements of the Privy Council that there is no doubt as to the consequence of reversal, modification or alteration of a decree in the cases of the decree-holder auction purchaser as well as bona fide stranger auction purchaser, the question is not free from difficulty in the case of a person who bona fide purchases from a decree-holder auction purchaser. He resolved this question by saying that an assignee for value taking an assignment bona fide from a decree-holder auction purchaser will not be affected by the subsequent reversal or alteration of the decree in execution of which the sale was held. His position is the same as that of a stranger auction-purchaser who purchases for fair value and bona fide. 27, In SA. No. 482 of 1973, Viswanatha Iyer, J. also agreed with the decision reported in 1970 KLJ. 458. In Gopi Lai v. Jamuna Prasad (AIR. 1954 Patna 36) a Division Bench of the Patna High Court consisting of Ramaswami and Jamuar JJ. said that the doctrine of restitution is based on the equitable principle that on the reversal or modification of a previous order the party affected should, as far as possible, be placed in the same position which he would have occupied but for such a decree, because it is the duty of the Court to act rightly and fairly according to circumstances towards all the parties. But this principle cannot be applied in a case where it conflicts with another rule of equity, namely that a bona fide purchaser for value should not be allowed to suffer on account of the mistakes or irregularities committed in a court of law.
But this principle cannot be applied in a case where it conflicts with another rule of equity, namely that a bona fide purchaser for value should not be allowed to suffer on account of the mistakes or irregularities committed in a court of law. The court held thus: - "Incur opinion, there can be no order of restitution passed in this case, since a portion of the property had already gone into possession of third parties, and there is no material on the record to suggest that the third parties concerned were not 'bona fide' purchasers for value or that they had notice of the compromise order passed on 15-12-1944 by the High Court." It has to be noted that this Division Bench has relied on 10 All 166. 28. Mrs. Rhodes v, Padmanabha (ATR,1915 Madras 150) was a case of purchase by a stranger in court-auction. The court said that as the purchaser was a stranger purchaser his sale could not be invalidated on the ground of any defect or irregularity in the court proceedings. It was further held that the purchaser was entitled and had a right to presume that the court had taken the necessary steps to investigate the rights of parties, and that a proper decree bad been passed and that any other view would lead to highly mischievous results and introduce grave and serious doubts on sales held under the authority of court. 29. Sheik Ismail Rowther v. Rajah Rowther (ILR. 30 Madras 295) is a clear authority for the proposition that a bona fide purchaser for value from decree-holder purchaser has got the same protection as that of the decree-holder auction purchaser. The Division Bench observed: "We are unable to agree with the argument on behalf of the plaintiff, that the decree originally passed was void. The Court had undoubtedly jurisdiction over the subject-matter, and any error as to the effect of the compromise would not render the decree void. Assuming that the first defendant in obtaining the decree had been guilty of misrepresentation or fraud, the proceedings were only voidable, and a bona fide purchaser from him is entitled to rely on his title as such.
Assuming that the first defendant in obtaining the decree had been guilty of misrepresentation or fraud, the proceedings were only voidable, and a bona fide purchaser from him is entitled to rely on his title as such. The plaintiff had only an equity to set aside the proceeding which were the result of fraud or misrepresentation, and that equity cannot be allowed to prevail against persons in the position of the appellants." In Venkatash Kotadia v. Shantha Bat (AIR. 1961 Madras 105) is a case of a stranger auction purchaser. There the question was whether the continued existence of a decree was a condition precedent for the confirmation of the sale. After a detailed discussion of the relevant case law, the court held that the subsistence of a decree was not necessary and the title of the purchaser vested in him from the date of sale even though it became effective when the sale was confirmed. From this judgment it is clear that the purchaser in a court auction would acquire absolute and indefeasible title at the execution sale, if at the time when the sale took place there was a valid and enforceable decree, whatever might happen to the decree, whether a reversal or confirmation on appeal. 30. In Marimuthu Udayar v. Subbaraya Pillai (13 MLJ. 231) their Lordships put the case on the ground of practicability of restitution. The learned judges observed: - "But such restitution is impracticable in favour of a purchaser for value from the decree-holder or from the purchaser benami for the decree-holder. A purchaser by the decree-bolder without the permission of the court (whether made by himself or through another person) being, under S.294, Civil P C., not void, but only voidable, it cannot for the above reasons be avoided against a transferee in good faith for valuable consideration, and this is in accordance with the principle of law that as a general rule, the right to a void an avoidable contract is determined when the vendee has before the vendor's election to a void, transferred the property to a purchaser in good faith for valuable consideration." It has to be noted that the general rule in the Law of Contract is if a contract of transfer is voidable it cannot be avoided against a transferee in good faith for valuable consideration.
In fact, in certain cases the right to avoid an avoidable contract is determined when the vendee has before the vendor's election to avoid, transferred the property to a purchaser in good faith for valuable consideration. In Babcock v. Lawson (1880) 5 QBD 284 bram-well L. J. said: "The case is somewhat analogous to that where a person is induced to part with his goods by fraud, the contract is voidable and he can recover back the goods; but if the person who has fraudulently, obtained the goods part with them to a bona fide purchaser, the purchaser can hold the property against the person defrauded." The general principle is that from a bona fide purchaser for value without notice, nothing which he has honestly acquired can be taken away. It is significant to note here the principle tha» 'no roan can transfer a better title than what be has' found do application. Reference may also be made to the statement of the law in Freeman on Void Judicial Sales, 4th Edn. at page 133: "Nor can an innocent purchaser be injuriously affected by proof of any mistake, error or fraud of an administrator or guardian in conducting a sale. Although the original purchaser has himself been guilty of fraudulent devise, or has had notice of such devices practised by others, he can transmit a valid unimpeachable title to a vendee for value, in good faith, and without notice." 31. Now I shall refer to S. Chokalingam v. s.krishna (AIR. 1964 Madras 404). Veeraswami and Ramamurti, JJ. have considered the question very exhaustively in this decision. The court held thus: "When a property is purchased in execution of a decree by the decree-holder purchaser himself, such property will be liable to an obligation or claim for restitution in the event of the decree under execution being reversed or set aside on appeal. But in the case of a stranger auction-purchaser, the judgment debtor is not allowed to obtain restitution of property.
But in the case of a stranger auction-purchaser, the judgment debtor is not allowed to obtain restitution of property. If the purchaser were to lost the benefit of his purchase on the contingency of the subsequent reversal of the decree, there will be no inducement to the intending purchasers to but at execution sale and consequently the property would not fetch its proper price at such sales, and the net result would be that the judgment-debtor would be the ultimate sufferer." The court has given its reasons thus: "The language of S.144 does not admit of an unqualified absolute interpretation that the ultimate result of the case is to be completely ignored and restitution ordered in any event, merely because the decree in execution of which the sale took place is varied or reversed. In the matter of restitution equitable considerations are certainly relevant and essential. While exercising its equitable jurisdiction under S.144, the court should act rightly and fairly according to the circumstances towards all the parties involved." It is instructive to note how the master is dealt with in Corpus Juris Secundum and American Jurisprudence.
In the matter of restitution equitable considerations are certainly relevant and essential. While exercising its equitable jurisdiction under S.144, the court should act rightly and fairly according to the circumstances towards all the parties involved." It is instructive to note how the master is dealt with in Corpus Juris Secundum and American Jurisprudence. "A bona fide grantee for value from a purchaser at a judicial sale is not affected by irregularities, mistakes, or fraud of which he did not have notice, and which do not render the sale void, although as to the grantor the sale might have been set aside " (Corpus Juris Secundum -page 669) "Reversal for error or irregularity: As a general rule, the reversal, on account of error or irregularities not going to the jurisdidiction of a decree directing a judicial sale, does not vitiate the title of one who, as a stranger to the proceeding, has in good faith purchased property at the sale, either before appeal or writ of error or pending the same without supersedes, and despite the reversal all rights lawfully acquired at the sale will be protected This principle advances the stability and productiveness of judicial sales and the value of title derived under them, and operates as well in the interests of the owners of the property sold as for the protection of purchasers." (American Jurisprudence Page 342 - Note 55) Subsequent grantees: "Whether the reversal of a judgment or decree of sale will affect the title of a third person who purchases the property from a party or privy to the proceeding who bought it at the sale has been differently decided in different jurisdictions in some, by reason of statutory provisions, and in others, because of the manner in which the question has been presented. In those jurisdictions in which it is held that the title of the plaintiff who becomes the purchaser is not affected by the reversal, the courts necessarily hold that the title of his grantee will not be affected. In some jurisdictions in which the title of the plaintiff who becomes the purchaser is defeated by the reversal, there are holdings that the title of a stranger who purchases from the plaintiff before the proceedings for review are taken will not be defeated.
In some jurisdictions in which the title of the plaintiff who becomes the purchaser is defeated by the reversal, there are holdings that the title of a stranger who purchases from the plaintiff before the proceedings for review are taken will not be defeated. Such a result may flow in some jurisdictions from the form of the review proceedings, the court in one case having pointed out that while an appeal acted as a supersedes, a writ of error is a new suit requiring service or appearance, and that unless a supersedes was granted a third party was not bound to take any notice of it. On the other band it has been held that the title of a stranger who purchases after the appeal is taken will, be defeated. One who purchases from a purchasing plaintiff after the reversal of the judgment is of course charged with notice of such reversal and the consequent failure of the plaintiff's title, and hence, he must make restitution of every thing which he may have thus acquired from the plaintiff." (American Jurisprudence Page 346 Note 61). I may also quote Halsbury's Laws of England Vol. 16 Page 686: "Parties claiming through grantee: A conveyance made in such circumstances as to be impeachable by the grantor as against the grantee is impeachable as against all volunteers claiming through the grantee. It is also impeachable as against a purchaser for value deriving title under the grantee who takes with notice of the grantor's equity, or of the circumstances from which the court infers such equity; but purchases for value without notice of the circumstances in which the deed was executed are not affected by the equity, and so far as their interests are concerned, the conveyance will be upheld." 32. I am of the view that the same protection afforded to a stranger auction purchaser in the matter of restitution, should be given to a purchaser for value without notice, from a plaintiff auction purchaser. I feel that this principle advances the reliability, stability and productiveness of judicial sales and the value of the title derived under them. It is necessary in the interests of the owners of the property sold as for the protection of purchasers. The result of the above discussion would suggest that the view taken by this court in the decision reported in 1970 KLJ.
It is necessary in the interests of the owners of the property sold as for the protection of purchasers. The result of the above discussion would suggest that the view taken by this court in the decision reported in 1970 KLJ. 458 and the decision in SA. No. 482 of 1973 require no re-consideration. 33. The answer I have now given on the primary question in regard to the right of a purchaser from a decree-holder auction purchaser clipped the wings of the subsidiary question. It is considerably decelerated. Howbeit I feel that I should deal with that question also. This requires an examination of the facts of the case. I now turn to the facts of the case. 34. The property in dispute belonged to one tarwad by name Padanattil Chegottu Kunnath Tarwad. OS. No. 397 of 1941 was a suit filed for redemption and recovery of possession of some other properties held by the said tarwad on tenancy rights. The suit was decreed for recovery of possession of the leasehold property and also for arrears of rent. The decree was executed. A number of items of properties belonging to the tarwad including the plaint properties were attached and sold in court auction. The decree-holder was one Muhammad Haji. The decree-holder himself purchased the properties when it was sold in court sale He purchased the property on 18-3-1945 and got delivery of the property on 12-3-1946. According to the respondent, Muhammad Haji was dealing with the property as full owner after taking delivery of the same. 35. Portions of the properties purchased by him were leased to various tenants under Exts. A31 to A35. The suit property was the subject matter of Ext. A31. This lease was on 2-5-1946. It was in favour of one Raghavan Nair, who according to the appellant, is a close relative of the tarwad. The appellant submits that Raghavan Nair has married a lady from the said tarwad. It is stated that the lease was for a premium. Raghavan Nair sold his leasehold interest to one Ayyappan under Ext. Al. Eu. Al is dated 15-11-1948. Ayyappan assigned his rights for valuable consideration to one Raman Menon under Ext. A2. Ext. A2 is dated 18-5-1950. Raman Menon assigned his rights for valuable consideration to the plaintiff. The document is Ext. A3. It is dated 3-10-1950. 36.
Raghavan Nair sold his leasehold interest to one Ayyappan under Ext. Al. Eu. Al is dated 15-11-1948. Ayyappan assigned his rights for valuable consideration to one Raman Menon under Ext. A2. Ext. A2 is dated 18-5-1950. Raman Menon assigned his rights for valuable consideration to the plaintiff. The document is Ext. A3. It is dated 3-10-1950. 36. One member of the tarwad, the first defendant in the suit challenged the decree in O. S.397 of 1941. Fie filed an application to set aside thel exparte decree, under Order IX Rule 13 CPC. The appellate court in reversal of the order of the trial court set aside the decree in O.S.397/41. The judgment of the District Judge was confirmed by the High Court of Madras in 1958. It is disclosed from the facts that the decree was set aside on the ground that summons was not served on one of the members of the tarwad, even though the other members had been served with summons in the suit. It has to be noted that the plaintiff in the present suit obtained the rights in the property long before the decree was re-opened by the order of the court. 37. When the decree was set aside proceedings by way of restitution were started by the present first defendant and the karanavan of the tarwad. All the properties included in O.S.397/41 which Muhammad Haji had taken possession of in execution of the decree were scheduled in the proceedings for restitution. Item No. 6 in E. P. No. 29 of 1959, the application for restitution, was the suit property. 38. The learned counsel for the respondent invited my attention to the fact that there was no proceedings to set aside the sale of the suit property in execution of the decree in O.S.397 of 1941. Further he submits in application E.P. 29 of 1959 it was adoor itted that the property was outstanding in the possession of a tenant and the only prayer that was made in the application was for symbolic delivery and not for possession. Whatever be the position, it is seen that the property was re-delivered pursuant to the restitution proceedings. The re-delivery is evidenced by Ext. B2 dated 5-4-1966 and Exts. A25 and A27 are report and account of the Am in.
Whatever be the position, it is seen that the property was re-delivered pursuant to the restitution proceedings. The re-delivery is evidenced by Ext. B2 dated 5-4-1966 and Exts. A25 and A27 are report and account of the Am in. Here again the counsel for the respondent submits that the lessee in the present suit was not made a party in the restitution proceedings. Under, these circumstances, the present plaintiff Abdulla filed suit O. S.288 of 1966. He contended that he was not evicted pursuant to the restitution proceedings, and there was no re-delivery of the property and that he was not dispossessed from the property. He prayed for an injunction to restrain the defendant from interfering with his possession of the property. 39. The trial court dismissed the suit holding that there was a proper delivery and that the tarwad got back the property. Plaintiff filed an appeal. In appeal, the trial court judgment was confirmed. Plaintiff then tiled S. A. 482 of 1973 before this court. He also filed a petition for amending the plaint to incorporate the prayer for declaration of title and recovery of possession of the suit property. This court allowed the appeal and set aside the decree and judgments of the courts below and remanded the case to the trial court for permitting the plaintiff to amend the plaint as indicated in the judgment and then to dispose of the suit in accordance with law and in the light of the findings and observations in that judgment. Here lam not referring to the observations in the judgment remanding the case. I shall revert back to it after stating what has happened after remand. 40. After remand, the trial court found that the tarwad obtained possession of the property pursuant to the restitution proceedings. The trial court also found that the plaintiff has established his title to the suit property and his right to obtain recovery of possession on the strength of his title. The suit was decreed allowing recovery of the property. The defendant filed an appeal. The District Court confirmed the judgment and decree of the trial court. Now the defendant appeals to this court. 41. Now I shall state the observations of Viswanatha Iyer J. in the judgment remanding the case (S. A. No. 482 of 1973).
The suit was decreed allowing recovery of the property. The defendant filed an appeal. The District Court confirmed the judgment and decree of the trial court. Now the defendant appeals to this court. 41. Now I shall state the observations of Viswanatha Iyer J. in the judgment remanding the case (S. A. No. 482 of 1973). (1) that the plaintiff had fixity of tenure at the time when the order for delivery was passed and that he was not liable to be dispossessed in the delivery proceedings. (2) that the restitution can be ordered only subject to the leasehold right of the plaintiff. There is no difference between a total assignment of the decree-holder auction purchaser's right and the carving out of a lesser interest of the decree-holder auction purchaser. The principle is the same, namely, the third party who has got an interest in the property purchased in court auction should not be affected. Agreeing with the decision of Poti, J., as he then was, in 1970 KLJ. 458, and considering the facts of the case, Viswanatha Iyer, J. held that the plaintiff's title in the present suit will not be affected by the restitution proceedings since he is a bona fide purchaser for value from a decree-holder auction purchaser. 42. The appellant in this case questions the earlier finding by Viswanatha Iyer, J. in SA 482 of 1973, that the plaintiff's title is not affected by the restitution proceedings. The learned counsel for the appellant sub-m its that if I hold that the decisions of Poti, J. as he then was, in 1970 KLJ. 458 and Viswanatba Iyer, J. in SA 482 of 1973 have not laid down the law correctly, then in this case, I am not bound by the earlier findings of Viswanatha Iyer, J. in SA 482 of 1973. 43. The learned counsel for the appellant submits that this question has to be decided on the basis of the provisions contained in S.105(2) of the of Civil Procedure Code. 8.105(2) reads thus:-"105.
43. The learned counsel for the appellant submits that this question has to be decided on the basis of the provisions contained in S.105(2) of the of Civil Procedure Code. 8.105(2) reads thus:-"105. Other orders.-(I) - (2) Notwithstanding anything contained in sub-section (1) where any party aggrieved by an order of remand from which an appeal lies does not appeal therefrom, he shall thereafter be precluded from disputing its correctness." The counsel also referred me to S.5 of the High Court Act which provides for an appeal from the judgment in second appeal, with the leave of the court which decided the second appeal. The counsel submits that an application was filed for obtaining leave for filing a further appeal but that was rejected. He submits that since there was no leave granted, no appeal could have been filed from the judgment of Viswanatha Iyer, J. in S. A. No. 482 of 1973. In this context, the counsel for the respondent invited my attention to the fact that against the judgment of Viswanatha Iyer, J. the present appellant filed an application for special leave, before the Supreme Court taking all possible contentions and pointing out also that there is difference of opinion between High Courts in regard to the rights of a bona-fide purchaser from a decree-bolder auction purchaser in the matter of restitution proceedings under S.144. The counsel submits that the application for special leave was dismissed. He also tells me that a review application was filed on the order refusing to grant special leave. That review application was also dismissed. The counsel has placed before me for my perusal the attested copies of the orders of the Supreme Court and also the affidavits filed by the parties before the Supreme Court to spot light the fact that the question now argued at length by the counsel for the appellant has been taken before the Supreme Court in the special leave application. 44. The learned counsel for the appellant referred me the decision reported in Satyadhyan v. Smt. Deorajin Debt (AIR. 1960 SC.
44. The learned counsel for the appellant referred me the decision reported in Satyadhyan v. Smt. Deorajin Debt (AIR. 1960 SC. 941) and invited my attention to paragraph 8 of that decision which runs thus: "The principle of res judicata applies also as between two stages in the same litigation to this extent that a court, whether the trial court or a higher court having at an earlier stage decided a matter in one way will not allow the parties to re-agitate the matter again at a subsequent stage of the same proceedings. Does this however mean that because at an earlier stage of the litigation a court has decided an interlocutory matter in one way and no appeal has been taken therefrom or no appeal did lie, a higher court cannot at a later stage of the same litigation consider the matter again?" The counsel submits that since no appeal has been preferred against the judgment of Viswanatha Iyer, J. the appellant is not precluded from agitating the question which was decided against him by Viswanatha Iyer, J. I do not think that this decision will help the appellant to support his argument. I shall state my reasons after referring to the other decisions cited before me by the learned counsel for the appellant. He has cited the following decisions: U. P. E. Supply Co. v. T. N. Chatterjee (AIR. 1972 SC. 1201) and Kshitish Chandra v. Commr. of Ranchi (AIR. 1981 SC. 707). I think the decision-AIR. 1972 SC. 1201 only states the broad proposition that a party is not bound to appeal against every, interlocutory order which is a step in the procedure which leads up to a final decision or award. It was further held that where the High Court in writ proceedings quashed the award of the Industrial Tribunal and remanded the case to the Tribunal under Art.227 for fresh disposal in accordance with law, the order is interlocutory and not a final order and, therefore, the decision on any particular point given therein cannot operate as res judicata in an appeal by special leave filed against the final award of the Tribunal given after the remand. 45. AIR. 1981 SC. 707 also is of no help to the appellant.
45. AIR. 1981 SC. 707 also is of no help to the appellant. Fazal Ali, J. held in the above decision that where the High Court in second appeal though not having jurisdiction illegally reversed the concurrent finding of fact and ordered remand, the aggrieved party can, in an appeal to the Supreme Court from the final order of the High Court after remand, challenge even the first order of the High Court making remand and all the proceedings taken thereafter as a result of the illegal order of remand. The court further held that the first judgment of the High Court ordering remand being illegal all the proceedings taken thereafter would become void ab initio. 46. What I feel as the root question that has to be decided by me on this aspect is whether the High Court can in these proceedings (in this second appeal) say that the findings in the remand order are wrong. I think this court cannot do it. Only an appellate court or a court of review can consider the correctness of the decision rendered by Viswanatha Iyer, J. in S A. No. 482 of 1973. This is clear from what I have quoted from AIR. 1960 SC. 941. It has to be noted that the Supreme Court has very clearly stated that a higher court alone can decide the correctness of an earlier decision which was a step in the process of the final adjudication of the case. Of course, the case considered by the Supreme Court was the case of an interlocutory order. I think I can safely rely on the decision reported in ATR.1977 SC. 1011 (Jasrajv. Hemraf) which gives a conclusive answer to the point raised by the counsel for the appellant. id paragraph 14 of the judgment, the court observed: "Be that as it may, in an appeal against the High Court's finding, the Supreme Court is not bound by what the High Court might have held in its remand order. It is true that a subordinate court is bound by the direction of the High Court. It is equally true that the same High Court, hearing the matter on a second occasion or any other court of co-ordinate authority hearing the matter cannot discard the earlier holding, but a finding in a remand order cannot bind a higher court when it comes up in appeal before it.
It is equally true that the same High Court, hearing the matter on a second occasion or any other court of co-ordinate authority hearing the matter cannot discard the earlier holding, but a finding in a remand order cannot bind a higher court when it comes up in appeal before it. This is the correct view of the law." Certainly this court is hearing the matter on a second occasion and I cannot discard the earlier finding of Viswanatha Iyer, J. in the decision in S A. No. 482 of 1973. I have to hold against the appellant in regard to the subsidiary question raised by the counsel for the appellant. 47. Now I come to the third and last of the questions argued by the counsel for the appellant. The counsel for the appellant submitted that the plaintiff cannot claim protection as a bona fide transferee for value without notice on the basis of the original lease and the purchase of it under Ext. A3. Subsequent to Ext. A3, Mohan mad Haji filed a suit for recovery of the property in which the present plaintiff got himself impleaded as additional 9th defendant This suit ended in a compromise. The document evidencing the compromise is Ext. A6. It is dated 11-10-1955. According to the counsel for the appellant, the plaintiff is holding the property under Ext. A6 which is a new lease. The counsel submits that this new lease is of the year 1955. This lease is with notice to the subsequent developments in the case, namely reversal of the decree and order of restitution. He farther submits that there is an implied surrender of the earlier lease in Ext. A3 in view of Ext. A6 and so the question of a bona fide transfer for value without notice from the auction purchaser has no relevance in this case. I think the appellant cannot canvass this point in second appeal. This case was never raised or argued before any court. No consideration is seen to have been made by the courts below in their judgments. No question of law has been raised in the appeal memorandum also.
I think the appellant cannot canvass this point in second appeal. This case was never raised or argued before any court. No consideration is seen to have been made by the courts below in their judgments. No question of law has been raised in the appeal memorandum also. The counsel for the respondent submits that the question whether there is an implied surrender is essentially a question linked up with facts and that he cannot be asked to meet the arguments based on implied surrender without raising it in the lower courts and not even raising it in the appeal memorandum here in this appeal. He further submits that in paragraph 3 of the plaint the plaintiff has claimed tenancy right only under Ext. A3 and there is no denial of that contentions in para 3 on the basis that the plaintiff cannot claim to hold the property under Ext, A3 in the presence of A6. I think the counsel for the respondent is absolutely correct in his submission. Howbeit, I shall deal very briefly with this question also. 48. Ext. A6 is dated 11-10 -1955. A reading of Ext. A6 will show that there is no surrender of the earlier lease. In Ext. A6 earlier lease is recognised by the landlord and he allowed the plaintiff to continue in possession under the earlier lease. Ext. A6 only contemplates a new arrangement. I shall quote certain recitals in Ext. A6. Nothing is in evidence as to what had happened subsequent to Ext. A6. Certainly it is matter for proof. I am of opinion that Ext. A6 at the worst only contemplates a new arrangement. Intent and purpose of Ext. A6 was to end the litigation. It is clear that by Ext. A6, the previous relationship that existed on the date of Ext. A6 has not been extinguished. Of course, the counsel would submit that after Ext. A6, it is not possible to consider that the plaintiff continued in possession as per the assignment in his favour of the original lease. He says that there is an implied surrender of the earlier lease. What is the principle behind the doctrine of surrender by operation of law or implied surrender. Spencer Bower tells us that the maxim is based essentially on the principle of estoppel.
He says that there is an implied surrender of the earlier lease. What is the principle behind the doctrine of surrender by operation of law or implied surrender. Spencer Bower tells us that the maxim is based essentially on the principle of estoppel. "The principle regulating the surrender of leases by operation of law are substantially the same as those which govern estoppels between landlord and tenant in general, of which such surrender is only one amongst several examples." (Vide Spencer Bower and Turner-The Law relating to Estoppel by representation-Page 202-para 198). In Lyon v. Reed (1844) 13 M & W 285, it is observed thus: "There the law treats the doing of such act as amounting to a surrender. Thus, if a lessee for years accept a new lease from his lessor, he is estopped from saying that his lessor had not power to make the new lease; and, as the lessor could not do this until the prior lease had been surrendered, the law says that the acceptance of such new lease is of itself a surrender of the former." This passage explains the rationale of the principle of implied surrender by act of parties and by operation of law. 49. The term "surrender by operation of law" is the expression used to describe all those cases where the law implies a surrender from unequivocal conduct of both parties which is inconsistent with the continuance of the existing tenancy. Vide-Woodfail's Law of Landlord and Tenant-822-823. It is plain and clear that there should be an unequivocal conduct signifying the acceptance of a new lease, to attract the principle of implied surrender. An agreement contemplating a new lease and allowing the continuance of possession under the old lease can never be treated as an unequivocal conduct, sufficient to attract the principle of implied surrender. Here pleading and proof are important. 50. In the case of surrender by acceptance of a new lease, it has to be remembered that only a valid new lease implies the surrender of the existing lease and operates as a surrender thereof by act and operation of law, but not if the second lease be voided voidable. It is always subject to an implied condition that a new lease is good and that if be not so, the old lease remains in force. Vide Knight v. Williams ((1901) 1 Ch. 256) 51.
It is always subject to an implied condition that a new lease is good and that if be not so, the old lease remains in force. Vide Knight v. Williams ((1901) 1 Ch. 256) 51. Megarry tells us in his treatise -Law of Real Property- thus: "Surrender by operation of law. Surrender by operation of law requires some act by the parties showing an intention to terminate the lease, in circumstances such that it would be inequitable for them to rely on the fact that there has been no surrender by deed The basis of this doctrine is the law of estoppel, which operates at the determination of a tenancy much as at the creation of one. The principle of surrender by operation of law js applicable only when law implies a surrender from the conduct of both parties which is unequivocal in character and is inconsistent with the continuance of the existing tenancy." I do not think on a consideration of Ext. A6 alone, without a pleading spotlighting a case of implied surrender, I can say that there is an implied surrender, of the earlier lease. 52. The counsel for the respondent submits that this court should not allow the appellant to raise the question of implied surrender in this appeal on another reason also. This question was not raised when the matter was argued before this court in S. A. No. 482 of 1973. He submits that the principle of constructive res judicata has to be applied in the circumstances. I think there is much force in his argument. 53. The counsel for the respondent further submitted that when it is said that the second lease, namely the lease under Ext. A6 is a lease which will not attract the protection on the basis that the transferee from a court auction purchaser has got the protection against restitution, it has to be considered that the lease is voidable and so one of the conditions required for a valid implied surrender is wanting in this case since it is necessary that a new lease should be good and should not be void or voidable. 54.
54. The counsel referred rune to the illustration given in Mulla's Transfer of Property Act, page 742 A, the karanavan of a Malabar tarwad, grants a lease for years to B A then grants a perpetual lease to B which if valid would have implied a surrender of the lease for years. But the perpetual lease was in excess of as powers, and it was set aside by as successor. But as successor could not evict B as a trespasser, for the surrender being invalid, B was entitled to hold until the expiry of the lease for years. The counsel also referred me to Jamini Mohan Sarkar v. Debendran Narain Singh (AIR. 1924 Calcutta 355): "Where a Hindu widow grants a permanent lease of a plot of land at a fixed rent to a person who is already in possession under a prior lease, at a variable rent granted by the full owner and the grant is not intended to operate as a new lease, the object of the parties being merely to alter one of the most important incidents of the tenancy that is to fix the rent in perpetuity, that the new lease is not operative against the revisionist. An implied condition of surrender by operation of law is that the new lease should be a valid one. Accordingly, a lease which is void or voidable or which does not pass interest according to the contract of the parties does not operate as a surrender." 55. I decline to examine the correctness of these submissions of the counsel for the respondent, though I feel that it may merit an examination for the obvious reason that the plaintiff is succeeding on the main points and that I should not further lengthen this judgment. 56. Now the counsel for the respondent refers roe to Ss.2t and 43 of the Malabar Tenancy Act, 1929, which had been amended drastically in 1945,1951 and 1954 and submits all these questions are now only academic. "21. Notwithstanding any contract to the contrary, whether entered into before or after the commencement of this Act, every cultivating Verumpattamdar, every customary verutnpattamdar, every kanamdar. every kanam-kuzhikanamdar, every kuzhikanamdar, every tenant of a kudiyiruppu and every holder of a protected ulkudi or a kudikidappu shall have fixity of tenure in respect of his holding and shall not be evicted therefrom except as provided in this Act; 43.
every kanam-kuzhikanamdar, every kuzhikanamdar, every tenant of a kudiyiruppu and every holder of a protected ulkudi or a kudikidappu shall have fixity of tenure in respect of his holding and shall not be evicted therefrom except as provided in this Act; 43. Notwithstanding anything contained in the Transfer of Property Act, 1882, or in any other law for the time being in force, or in any contract, a cultivating tenant or the holder of a kudiyiruppu shall be entitled to continue on the holding as such, although the rights of his immediate landlord or of any superior landlord have been extinguished, whether by eviction or by redemption of a mortgage or otherwise subject, however to a liability to pay fair rent and to the provisions of this Act applicable to a cultivating tenant ;or the holder of a kudiyiruppu, as the case may be." The learned counsel for the respondent submits that the plaintiff was a cultivating tenant within the scope of the above provisions and the claim for restitution as originally made in E. P. 29 of 1959 was consistent with the statutory protection conferred on tenants and that was why the tenants in possession were not impleaded as parties and the claim was only for symbolic possession. I feel that it is not necessary for me to consider this point also for the same reasons I have stated in paragraph 56 of this judgment. In the result, I see no merit in this second appeal. It is dismissed No costs.