PETITIONER:
NAGUBAI AMMAL & OTHERS
Vs.
RESPONDENT:
B. SHAMA RAO & OTHERS.
DATE OF JUDGMENT:
26/04/1956
BENCH:
AIYYAR, T.L. VENKATARAMA
DAS, SUDHI RANJAN (CJ)
IMAM, SYED JAFFER
CITATION:
1956 AIR 593 1956 SCR 451
ACT
Lis pendens, Scope of-If prevents passing of title as
between the transferor and the transferee-Nonjoinder of
Receiver in insolvency in the execution proceeding-Effect-
Transferee pendente lite, if entitled to attack execution
sale on that ground-Limitation and adverse possession
against a purchaser in execution of a decree on a prior
mortgage-Commencement-’Collusive’ and ’fraudulent’-
Distinction--Admission-Evidentiary value-When can shift the
burden of proof -’Maxim that ’a person cannot approbate and
reprobate’-Applicability-Transfer of Property Act (IV of
1882), s. 52-Indian Limitation Act (IX of 1908), Art. 142.
HEADNOTE
The appellants as defendants in a suit for declaration of
title to certain building sites sought to resist the
respondents’ claim, arising by purchase from a purchaser in
a sale in execution of a mortgage decree passed on a
mortgage deed of 1918, by a counter-claim based on a
purchase of the same lands made in 1920 by their pre-
decessor-in-interest from one of the mortgagors against whom
was then pending a suit for maintenance and for declaration
of a charge on the land in suit. That suit was decreed in
1921 and the lands were purchased by the decreeholder in
execution of her decree in 1928. The mortgagor had been
adjudged an insolvent in 1926 and the Official Receiver in
whom his estate vested was not made a party to the execution
proceeding. Suit to enforce the mortgage deed of 1918 was
brought in 1933 impleading the Official Receiver and the
purchaser in execution of the maintenance and charge decree
but not the appellants. In execution of the decree passed
in this suit, the lands in suit were sold to a third party
in 1936 and in 1938 the respondent’s father purchased them.
The respondent did not specifically raise the question of
lis pendens in his pleading nor was an issue framed on the
point, but he raised the question at the very commencement
of the trial in his deposition, proved relevant documents
which were admitted into evidence without any objection from
the appellants who filed their own documents, cross-examined
the respondent and invited the court to hold that the suit
for maintenance and a charge and the connected proceedings
evidenced by these documents were collusive in order to
avoid the operation of s. 52 of the Transfer of Property
Act. The District Judge held that the appellants’ title
acquired by the purchase of 1920 was extinguished by the
sale held in execution of the charge decree by the operation
of s. 52 of the Transfer of Property
59
452
Act and decreed the suit and his decision was affirmed by
the High Court in appeal.
Hold, that the decisions of the courts below were correct
and must be affirmed.
That in the facts and circumstances of the case the omission
of the respondent to specifically raise the question of lis
pendens in his pleading did not take the appellants by
surprise and was a mere irregularity which resulted in no
prejudice to them.
Rani Chandra Kunwar v. Chaudhri Narpat Singh ([1906] L.R. 34
I.A. 27), applied.
Siddik Mahomed Shah v. Mt. Saran and Others (A.I.R. 1930
P.C. 57), explained and held inapplicable.
That s. 52 of the Transfer of Property Act did not prevent
the vesting of title in a transferee in a sale pendente lite
but only made it subject to the rights of other parties as
decided in the suit and subsequent insolvency of the
transferor could not, therefore, vest any title in the
Official Receiver or make the title of the execution
purchaser liable to attack on the ground that the Receiver
was not made a party to the execution proceeding. That even
assuming that title could not wholly pass by a transfer
pendento lite and some interest would still subsist in the
transferor to vest in the Receiver, the lands in suit having
been sold in execution of a charge decree, the sale would at
the most be not binding on him and he could, if he so chose,
move to set it aside; but the transferee pendente lite or
his representative could not be allowed to make his non-
joinder a ground for attacking the sale.
Wood v. Surr ([1854) 19 Beav. 551), applied.
Inamullah Khan v. Shambhu Dayal (A.I.R. 1931 All. 159),
Subbaiah v. Ramasami Goundan (I.L.R. [1954] Mad. 80) and
Kala Chand Banerjee v. Jagannath Marwari ([1927] L.P. 54
I.A. 190), referred to.
That no question of limitation or adverse possession really
arose in the case. It was well settled that a claim of
adverse possession could not affect the right of a prior
mortgagee to bring the properties to sale and adverse
possession against the purchaser under that sale could not
commence prior to the date of sale.
Held further, that there was a fundamental distinction bet-
ween a collusive and a fraudulent proceeding in that while
the former was the result of an understanding between the
parties, both the claim and the contest being fictitious,
and the purpose to confound third parties, in the latter the
contest was real, though the claim was untrue, and the
purpose to injure the defendant by a verdict of the court
obtained by practising fraud in it;
that an admission was a mere piece of evidence and could not
be conclusive except by way of estoppel when it had been
acted
453
upon to his detriment by the person to whom it was made, the
weight to be attached to it depending on the circumstances
of each case, and the onus of proving that it was not true
could not shift to the maker of it unless it was so clear
and unambiguous as to be conclusive in absence of any
explanation from him.
Slatterie v. Pooley, ([1840] 6 M. & W. 664) and Rani Chandra
Kunwari v. Choudhri Narpat Singh ([1906] L.R. 34 I.A. 27),
referred to.
That the maxim that ’a person could not approbate and repro-
bate’ had its origin in the doctrine of election and was
confined to reliefs arising out of one and the same
transaction and against the parties to it. Where, however,
there was no question of election, as the relief claimed was
one and the same, although based on different and
inconsistent grounds, the maxim had no application.
Verschures Creameries Ltd. v. Hull and Netherlands Steamship
Company Ltd. ([1921] 2 K.B. 608), considered and
distinguished.
JUDGMENT
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 216 of 1953.
On appeal from the judgment and decree dated the 8th March,
1951 of the Mysore High Court in Regular Appeal No. 123 of
1947-48 arising out of the decree dated the 23rd June 1947
of the Court of District Judge, Bangalore in Original Suit
No. 84 of 1945-46.
K. S. Krishnaswami Iyengar and M. S. K. Sastri for the
appellants.
R. Ganapathy Iyer and K. R. Krishnaswamy for the
respondent No. 1.
1956. April 26. The Judgment of the Court was delivered by
VENKATARAMA AYYAR J.-This appeal arises out of a suit
instituted by one Krishna Rao, since deceased, and now
represented by his son and heir, the respondent herein, for
a declaration of his title to certain building sites situate
in Bangalore in the State of Mysore, and for consequential
reliefs. These properties belonged to one Munuswami, who
died leaving him surviving his third wife Chellammal., three
sons by his predeceased wives, Keshavananda,
454
Madhavananda and Brabmananda, and three minor daughters,
Shankaramma, Srikantamma and Devamma. On 1-9-1918 the three
brothers executed a usufructuary mortgage for Rs. 16,000 in
favour of one Abdul Huq over a bungalow and vacant sites in-
cluding the properties concerned in this litigation. A
period of three years was fixed for redemption. There was a
lease back of the properties by the mortgagee to the
mortgagors on 3-9-1918, and it was also for a period of
three years. On 6-9-1918 the three brothers effected a
partition under a deed, Exhibit K, which provided inter alia
that they were to pay each a sum of Rs. 8 per mensem to
their step-mother, Chellammal, for her maintenance, and that
their step-sisters should be under their protection.
On 6-6-1919 Chellammal presented a plaint in forma pauperis
claiming maintenance and praying that it might be charged on
the properties specified in the plaint. That was
Miscellaneous Case No. 377 of 1918-19. At the same time,
she also presented as the next friend of her minor
daughters, Srikantamma and Devamma, two plaints in forma
pauperis, Miscellaneous Cases Nos. 378 and 379 of 1918-19
claiming maintenance and marriage expenses for them, and
praying that the amounts decreed might be charged on the
schedule-mentioned properties. The properties which are
involved in this suit are included in item 8 in schedule A
annexed to all the three plaints. On 17-6-1920 permission to
sue in forma pauperis was granted in all the three cases,
and they were registered as Suits Nos. 98 to 100 of 1919-20.
We are concerned in this appeal with only one of them, the
suit of Devamma which was Miscellaneous Case No. 379 of
1918-19, subsequently registered as Suit No. 100 of 1919-20.
The suits were contested, and decreed after trial on 12-12-
1921. The decree in 0. S. No. 100 of 1919-20 directed
the defendants each to pay to the plaintiff a sum of Rs.6
per mensem for maintenance until her marriage and Rs. 1,500
for marriage expenses, and the payment of the amount was
made a first charge on the properties. In execution of this
decree, the
455
properties with which we are now concerned, were sold on
2-8-1928 and purchased by Devamma, the decree-holder. A
sale certificate was issued to her on 21-11-1930 (Exhibit J-
5). Proceedings were also taken in execution of the decrees
obtained by Chellammal and Srikantamma and of one
Appalaraju, and all the properties - comprised in the
mortgage were sold and purchased by third parties. It must
be mentioned that all the three brothers were adjudicated
insolvents on their own application, Brahmananda by an order
dated 23-3-1923 in Insolvency Case No. 7 of 1921-22 and
Keshavananda and Madhavananda by an order dated 19-2-1926 in
Insolvency Case No. 4 of 1925-26. It also appears from the
evidence of D.W. 5 that at about this time all of them left
the place.
While these proceedings were going on, Abdul Huq, the
mortgagee, filed on 16-8-1921, O.S. No. 27 of 192122 against
Keshavananda and his two brothers for recovery of arrears of
rent due by them under the lease deed, and obtained a decree
on 21-10-1921 but was unable to realise anything in
execution thereof, and the execution petition was finally
dismissed on 22-1-1926. He then filed a second suit against
the mortgagors, O.S. No. 86 of 1931-32, for arrears of rent
for a period subsequent to that covered by the decree in
O.S. No. 27 of 1921-22 and for possession of the properties
on the basis of the lease dated 3-9-1918, and obtained a
decree on 22-3-1932 but was unable to get possession, as the
properties were in the occupation of third parties under
claims of right. Abdul Huq died on 20-3-1933, and
thereafter, his legal representatives filed on 30-8-1933
O.S. No. 8 of 1933-34 to enforce their rights under the
mortgage deed dated 1-9-1918. Among the defendants who were
impleaded in this suit were the mortgagors Keshavananda and
Madhavananda, Gururaja, son of Brabmananda who bad died, the
Official Receiver and the purchasers of the mortgaged
properties in execution of the maintenance decrees and the
decree of Appalaraju. Devamma was the third defendant in
this action. The plaint alleged that the mortgagors had
failed to
456
pay rent as provided in the lease deed dated 3-9-1918, and
had suffered collusive decrees to be passed against them in
the maintenance suits and other actions, and that properties
had been sold fraudulently in execution of those decrees.
On the basis of these allegations, the plaintiffs prayed for
a decree for possession as against the purchasers including
Devamma, and for a sum of Rs. 5,000 as damages. In the
alternative, they prayed for a decree for sale of the mort-
gaged properties for the amount due under the mortgage.
The suit was contested, and issues raised as to whether the
sales were collusive, and whether the plaintiffs were
entitled to possession and damages, and alternatively, as to
what amounts were payable under the mortgage and to what
reliefs the plaintiffs were entitled. At the trial, the
plaintiffs abandoned the relief as to possession and
damages, and it accordingly became unnecessary to go into
the question as to the collusive character of the
maintenance decrees and the execution sales. On 26-9-1935 a
decree was passed determining the amount payable to the
plaintiffs on redemption, providing for payment thereof on
or before 26th January 1936, and in default, directing the
sale of the properties. In execution of this decree, the
properties were sold in court-auction sometime in 1936, and
purchased by one Chapman, and possession was taken by him
through court on 18-2-1937. On 25-1-1938, Saldhana, who was
the agent of Chapman, and became his executor on his death,
sold the building sites now in dispute and forming part of
the properties purchased in court auction, to Krishna Rao,
the plaintiff in the present action. When Krishna Rao
attempted to take possession of the sites, he was obstructed
by one Garudachar, claiming title under a sale deed dated 1-
12-1932 executed by one Lokiah, the husband of Srikantamma,
sister of Devamma, and be accordingly filed O.S. No. 92 of
1938-39 in the court of the Subordinate Judge, Bangalore for
establishing his title to the suit properties, and for an
injunction restraining Garudachar from interfering with his
possession. The
457
suit was decreed on 23-7-1940, and the matter having been
taken in appeal to the High Court by Garudachar, the parties
entered into a compromise, and a decree, Exhibit E-1, was
passed in terms thereof on 18-9-1942. Under this decree.,
the title of the plaintiff to the suit properties was
recognised. After obtaining this decree, Krishna Rao
started building on the sites, when he met with fresh
obstruction, this time from the appellants who set up that
they were in possession under a claim of title.
Under the partition deed entered into by the mortgagors on
6-9-1918 (Exhibit K), Keshavananda was allotted two plots,
Nos. 3 and 4 to the west of East Lal Bagh Road in the plan,
Exhibit G. These are the very plots, which form the subject-
matter of the present suit. On 30-1-1920 Keshavananda con-
veyed these properties to Dr. Nanjunda Rao under a deed of
sale, Exhibit VI. There was on the same date a sale by
Brahmananda of plots Nos. 1 and 2 to Dr. Nanjunda Rao, but
those properties are not involved in this litigation. On
the death of Dr. Nanjunda Rao, his sons partitioned the
properties, and in the division the suit properties fell to
the share of one Raghunatha Rao, and on his death in 1938)
his estate devolved on his widow, Nagubai, who is the first
appellant. On 28-5-1939 she executed a trust deed settling
a moiety of these properties on the Anjaneyaswami Temple at
Karaikal, and the trustees of that institution are the other
appellants in this appeal. In view of their obstruction,
Krishna Rao instituted the suit out of which the present
appeal arises, for a declaration of his title to the sites
in question, and for an injunction restraining the defen-
dants from interfering with his possession, or in the
alternative, for a decree in ejectment if they were held to
be in possession. The claim made in the plaint is a simple
one. It is that the title of Chapman as purchaser in
execution of the decree passed on the mortgage dated 1-9-
1918 prevailed against all titles created subsequent to that
date, and that accordingly Dr. Nanjunda Rao and his
successors acquired under the sale deed dated 30-1-1920 no
title which could be
458
set up as against that of the plaintiff. The defendants
contested the suit on the ground, firstly, that as they were
not impleaded as parties in the suit on the mortgage, O.S.
No. 8 of 1933-34, their right of redemption remained
unaffected by the decree passed therein or the sale in
execution thereof; and secondly, that the suit was barred by
limitation, because the plaintiff was not in possession
within 12 years of the suit, and also because the defendants
had acquired title to the suit properties by adverse
possession for over 20 years.
The District Judge of Bangalore, who tried the suit, held
that the title of Dr. Nanjunda Rao to the suit properties
under the sale deed dated 30-1-1920 was, under section 52 of
the Transfer of Property Act, subject to the result of the
maintenance suit of Devamma (O.S. No. 100 of 1919-20), and
was in consequence extinguished by the purchase by her in
execution of the charge decree in that suit. On the ques-
tion of limitation, the learned Judge held that the
plaintiff had established possession of the properties
within 12 years of the suit, and that the defendants had
failed to establish title by adverse possession. In the
result, he granted a decree in favour of the plaintiff for
possession of the suit properties. The defendants appealed
to the High Court, Mysore and by their judgment dated 8-3-
1951 the learned Judges agreed with the District. Judge
that by reason of section 52 of the Transfer of Property
Act, the title of Dr. Nanjunda Rao based on the deed dated
30-1-1920 came to an end when Devamma purchased the proper-
ties in execution of her maintenance decree, and dismissed
the appeal, but granted a certificate under article 133(1)
of the Constitution, and that is how the appeal comes before
us.
Notwithstanding the tangle of legal proceedings extending
over 30 years, which forms the background of the present
litigation, the single and sole question that arises for
decision in this suit is whether the sale deed dated 30-1-
1920 under which the appellants claim is subject to the
result of the sale dated 2-8-1928 in execution of the decree
in O.S. No.100 of
459
1919-20 by reason of the rule of lis pendens enacted in
section 52 of the Transfer of Property Act. If it is, it is
not in dispute that it becomes avoided by the purchase by
Devamma on 2-8-1928. If it is not, it is equally
indisputable that the appellants as purchasers of the equity
of redemption from Keshavananda have a right to redeem the
mortgage dated 1-9-1918, and not having been impleaded in
O.S. No. 8 of 1933-34 are not bound either by the decree
passed therein or by the sale in execution thereof.
On this question, as the plaint in O.S. No. 100 of 1919-20
praying for a charge was presented on 6-6-1919, the sale to
Dr. Nanjunda Rao subsequent thereto on 30-1-1920 would prima
facie fall within the mischief of section 52 of the Transfer
of Property Act, and would be hit by the purchase by Devamma
on 2-8-1928 in execution of the charge decree. Sri K. S.
Krishnaswami Ayyangar, learned counsel for the appellants,
did not press before us the contention urged by them in the
courts below that when a plaint is presented in forma
pauperis the lis commences only after it is admitted and
registered as a suit, which was in this case on 17-6-1920,
subsequent to the sale under Exhibit VI--a contention
directly opposed to the plain language of the Explanation to
section 52. And he also conceded and quite rightly, that
when a suit is filed for maintenance and there is a prayer
that it be charged on specified properties, it is a suit in
which right to immovable property is directly in question,
and the lis commences on the date of the plaint and not on
the date of the decree, which creates the charge. But he
contends that the decision of the courts below that the sale
deed dated 30-1-1920 is hit by section 52 is bad on the
following three grounds: (1) The question of lis pendens was
not raised in the pleadings, and is not open to the
plaintiff. (2 The suit for maintenance, O.S. No. 100 of
1919-20 and the sale in execution of the decree passed
therein are all collusive, and section 52 has accordingly no
application. (3) The purchase by Devamma in execution of the
decree in O.S. No. 160 of 1919-20 on 2-8-1928 is void and
inoperative, as the Official Receiver in whom
60
460
the estate of Keshavananda had vested on 19-2-1926 was not a
party to the sale proceedings. The e contentions must now
be considered.
1. We see no substance in the contention that the plea of
lis pendens is not open to the plaintiff on the ground that
it had not been raised in the pleadings. It is true that
neither the plaint nor the reply statement of tile plaintiff
contains any averment that the sale is affected by the rule
of lis pendens. Nor is there any issue specifically
directed to that question. It is argued for the respondent
that the allegations in para 4 of the plaint and in. para 5
of the reply statement that Dr. Nanjunda Rao being a
transferee subsequent to the mortgage could claim no right
"inconsistent with or superstar to those of the mortgagee
and the auction-purchaser" are sufficiently wide to embrace
this question, and reference was made to issue No. 3 which
is general in character. Even if the plaintiff meant by the
above allegations to raise the plea of lis pendens, he has
not expressed himself with sufficient clearness for the
defendants to know his mind, and if the matter had rested
there, there would be much to be said in favour of the
appellant’s contention. But it does not rest there.
The question of lis pendens was raised by the plaintiff at
the very commencement of the trial on 8-3-1947 when he went
into the witness-box and filed in his examination-in-chief
Exhibit J series, relating to the maintenance suits, the
decrees passed therein and the proceedings in execution
thereof, including the purchase by Devamma. This evidence
is relevant only with reference to the plea of lis pendens,
and it is significant that no objection was raised by the
defendants to its reception. Nay, more. On 13-3-1947 they
cross-examined the plaintiff on the collusive character of
the proceedings in Exhibit J series, and filed documents in
proof of it, The trial went on thereafter for nearly three
months, the defendants adduced their evidence, and the
bearing was concluded on 2-6-1947. In the argument before
the District Judge, far from objecting to the plea of lis
pendens being permitted to be raised, the defendants argued
461
the question on its merits, and sought a decision on the
evidence that the proceedings were collusive in character,
with a view to avoid the operation of section 52 of the
Transfer of Property Act. We are satisfied that the
defendants went to trial with full knowledge that the
question of lis pendens was in issue, had ample opportunity
to adduce their evidence thereon, and fully availed
themselves of the same, and that, in the circumstances, the
absence of a specific pleading on the question was a mere
irregularity, which resulted in no prejudice to them.
It was argued for the appellants that as no plea of lis
pendens was taken in the pleadings, the evidence bearing on
that question could not be properly looked into, and that no
decision could be given based on Exhibit J series that the
sale dated 30-1-1920 was affected by lis; and reliance was
placed on the observations of Lord Dunedin in Siddik
Mahomed Shah v. Mt. Saran and others(1) that "no amount of
evidence can be looked into upon a plea which was never put
forward". The true scope of this rule is that evidence let
in on issues on which the parties actually went to trial
should not be made the foundation for decision of another
and different issue, which was not present to the minds of
the parties and on which they bad no opportunity of adducing
evidence. But that rule has no application to a case where
parties go to trial with knowledge that a particular
question is in issue,tbough no specific issue has been
framed thereon, and adduce evidence relating thereto. The
rule applicable to this class of cases is that laid down in
Rani Chandra Kunwar v. Chaudhri Narpat Singh: Rani Chandra
Kunwar v. Rajah Makund Singh(2). There, the defendants put
forward at the time of trial a contention that the plaintiff
had been given away in adoption, and was in consequence not
entitled to inherit. No such plea was taken in the written
statement; nor was any issue framed thereon. Before the
Privy Council, the contention was raised on behalf of the
plaintiff that in view of the pleadings, the question of
adoption was not open to the defendants. It was
(1) A.I.R. 1930 P.C. 57.
(2) [1906-07] L.R. 34 I A. 27.
462
held by Lord Atkinson overruling this objection that as both
the parties had gone to trial on the question of adoption,
and as the plaintiff had not been taken by surprise, the
plea as to adoption was open to the defendants, and indeed,
the defendants succeeded on that very issue. This objection
must accordingly be overruled.
2.It is next contended that section 52 of the Transfer of
Property Act does not operate to extinguish the title of Dr.
Nanjunda Rao and his successors under the sale dated 30-1-
1920, because the proceedings which resulted in the decree
in 0. S. No. 100 of 1919-20 and the sale in execution
thereof on 2-8-1928 were all collusive. Whether they were
so or not is essentially a question of fact, and both the
courts below have concurred in answering it in the negative.
It is contended for the appellants that this finding is the
result of an error into which the learned Judges of the High
Court fell as to the incidence of burden of proof, and it
should not therefore be accepted. The argument is that
Abdul Huq, his legal representatives and the plaintiff
himself bad admitted again and again in judicial proceedings
taken with reference to the suit properties that the decree
and sale in 0. S. No. 100 of 1919-20 were collusive, and
that, in consequence, even if the initial onus of
establishing this fact was on the defendants, that was
shifted on to the plaintiff on proof of the abovementioned
admissions, and as there was no evidence worth the name on
his side to explain them, he must fail.
We must now examine the several statements which are relied
on by the appellants as admissions, ascertain what their
true import is, and determine what weight should be attached
to them. On 27-6-1932 Abdul Huq moved the insolvency court
for a direction to the Official Receiver to take possession
of the mortgaged properties, which were stated to be in the
occupation of one Lokiah. This Lokiah, it has been already
mentioned, is the husband of Srikantamma, the sister of
Devamma, he having married her after the maintenance suits
had been decreed and sometime
463
prior to the court auction in 1928. In his petition, Abdul
Huq alleged that Lokiah conducted proceedings in execution
of the decree in O.S. No. 100 of 1919-20 in collusion with
the insolvents and without notice to the Official Receiver,
and purchased the properties in court auction on 2-8-1928 on
behalf of the decree-holder. The decree itself was not
attacked as collusive, and as for the sale dated 2-8-1928 it
was distinctly alleged in para 3 of the petition that the
purchase by Lokiah was for the benefit of Devamma. The
substance of the complaint of Abdul Huq was that the
execution proceedings and the sales were fraudulent, and
intended to defeat his rights to the rents and profits from
the properties. In other words, the ground of attack on the
sale dated 2-8-1928 was not that it was unreal and
collusive, but that it was real but fraudulent.
Now, there is a fundamental distinction between a proceeding
which is collusive and one which is fraudulent. "Collusion
in judicial proceedings is a secret arrangement between two
persons that the one should institute a suit against the
other in order to obtain the decision of a judicial tribunal
for some sinister purpose". (Wharton’s Law Lexicon, 14th
Edition, page 212). In such a proceeding, the claim put
forward is fictitious, the contest over it is unreal, and
the decree passed therein is a mere mask having the
similitude of a judicial determination and worn by the
parties with the object of confounding third parties. But
when a proceeding is alleged to be fraudulent, -what is
meant is that the claim made therein is untrue, but that the
claimant has managed to obtain the verdict of the court in
his favour and against his opponent by practising fraud on
the court. Such a proceeding is started with a view to
injure the opponent, and there can be no question of its
having been initiated as the result of an understanding
between the parties. While in collusive proceedings the
combat is a mere sham, in a fraudulent suit it is real and
earnest. The allegations in the petition of Abdul Huq set
out above show that the suit itself was not attacked as
collusive, but that the execution
464
proceedings were impeached as fraudulent. It should be
mentioned that on this petition the District Judge passed an
order on 30-6-1932 directing the Official Receiver to take
the necessary steps and report. But nothing came out of
this.
We next come to a petition filed after the death of Abdul
Huq by his legal representatives asking for permission of
the insolvency court to institute a suit on the mortgage
dated 1-9-1918 impleading the Official Receiver as party.
The allegations made in the petition are on the same lines
as those made by Abdul Huq in his petition dated 27-6-1932,
and they do not carry the matter any further. This petition
was ordered, and on 30-8-1933 O.S. No. 3 of 1933-34 was
instituted. In this suit, as already stated, the plaintiffs
sought to recover possession of the properties on foot of
the usufructuary mortgage, and ancillary to that relief,
they claimed damages from the defendants who were in
possession, on the ground that the execution proceedings
under which they got into possession were collusive and
fraudulent. Thus far, the allegations are a mere repetition
of what bad been stated in the prior proceedings. But the
plaint in the suit went further, and stated for the first
time that the proceedings in O.S. No. 100 of 1919-20 and the
decree passed therein were collusive. But these allegations
were made only as the basis of the claim for damages for
non-payment of rent under the lease deed dated 3-9-1918 and
non-surrender of possession of the properties, and their
true import is that the suit was fraudulent and intended to
deprive the mortgagee of the rents and profits to which be
was entitled. At the trial, as already stated, the relief
for possession and damages was given up, the question as to
the collusive character of the sale was abandoned, and a
decree for sale was passed. These proceedings are open to
the same comment as was made on the petition of Abdul Huq,
and do not assist the defendants.
It remains to deal with a proceeding to which the present
plaintiff was a party. It will be remembered that after his
purchase be was obstructed in his
465
possession by one Garudachar, and he had to file O.S. No. 92
of 1938-39 to establish his title against him. In his
plaint in that suit he stated, obviously adopting what Abdul
Huq and his legal representatives had previously alleged,
that the decree in O.S. No. 100 of 1919-20 and the execution
sale on 2-8-1928 were collusive. On behalf of the
appellants, a contention is urged that as the plaintiff
obtained a decree in O.S. No. 92 of 1938-39 on the strength
of the above allegations, it is not open to him in these
proceedings to go back on them, and plead the contrary.
That is a contention which will be presently considered.
But apart from that, the statements of the plaintiff in his
plaint in O.S. No. 92 of 1938-39 considered purely as
admissions, do not carry the matter beyond the point to
which the statements made by Abdul Huq and his legal
representatives in the prior proceedings take us. The
question then is, what is the effect to be given to these
statements?
An admission is not conclusive as to the truth of the
matters stated therein. It is only a piece of evidence, the
weight to be attached to which must depend on the
circumstances under which it is made. It can be shown to be
erroneous or untrue, SO long as the person to whom it was
made has not acted upon it to his detriment, when it might
become conclusive by way of estoppel. In the present case,
there is no question of estoppel, as the title of Dr.
Nanjunda Rao arose under a purchase which was long prior to
the admissions made in 1932 and in the subsequent years. It
is argued for the appellants that these admissions at the
least shifted the burden on to the plaintiff of proving that
the proceedings were not collusive, and that as he gave no
evidence worth the name that these statements were made
under a mistake or for a purpose and were, in fact, not
true, full effect must be given to them. Reliance was
placed on the well known observations of Baron Park in
Slatterie v. Pooley(1) that "what a party himself admits to
be true may reasonably be presumed to be so", and on the
decision in Rani Chandra Kunwar v. Chaudhri
(1) [1840] 6 M. & W. 664, 669; 151 E.R. 579, 581.
466
Narpat Singh: Rani Chandra Kunwar v. Rajah Makund Singh(1),
where this statement of the law was adopted. No exception
can be taken to this proposition. But before it can be
invoked, it must be shown that there is a clear and
unambiguous statement by the opponent, such as will be
conclusive unless explained. It has been already pointed
out that the tenor of the statements made by Abdul Huq, his
legal representatives and the plaintiff was to suggest that
the proceedings in 0. S. No. 100 of 1919-20 were fraudulent
and not collusive in character. Those statements would not,
in our opinion, be sufficient, without more, to sustain a
finding that the proceedings were collusive.
But assuming that they are sufficient to shift the burden on
to the plaintiff of proving that the decree and sale in 0.
S. No. 100 of 1919-20 were not collusive, the evidence
adduced by him is, in our opinion, ample to discharge that
burden. He has filed Exhibit J series, which give a
complete picture of the proceedings in 0. S. No. 100 of
1919-20. Under the partition deed, Exhibit K,it will be
remembered, the brothers agreed to pay a monthly maintenance
of Rs. 8 each to their step-mother, Chellammal. This,
however, was not charged on the family properties. With
reference to their step-sisters, Srikantamma and Devamma,
the provision was simply that the brothers should protect
them. It will also be remembered that under the partition
Keshavananda and Brahmananda each got two vacant sites in
full quit of their shares. It appears from Exhibit J-10,
paragraph 2, that the two brothers were contemplating the
disposal of their plots, in which case the claim of
Chellammal and the step-sisters to maintenance would be
defeated. It became accordingly necessary for them to
safeguard their rights, and for that purpose, to file suits
for maintenance and claim a charge therefor on the family
properties. That the apprehensions of Chellammal were well-
founded is established by the fact that the two brothers
entered into agreements for the sale of their vacant sites
to Dr. Nanjunda Rao on 20-10-1919, and sale deeds were
actually executed
(1) [1906-07] L.R. 34 I.A. 27.
467
pursuant thereto on 30-1-1920. There cannot be any doubt,
therefore, that the suits were bona fide. This conclusion
is further reinforced when regard is had to the conduct of
the litigation. Two of the brothers contested the suit. It
underwent several adjournments, and was heard finally in
December 1921. At the trial, a number of witnesses were
examined on either side, and the judgment, Exhibit J-6,
shows that the contest centred round the quantum of
maintenance payable to the plaintiffs, and it was keen, even
bitter. When at last the plaintiffs obtained decrees, they
had no easy time of it in realising the fruits thereof. The
troubles of a creditor, it has been said, begin after he
obtains a decree, and so it was with the plaintiffs.
Exhibit J-4 shows that Devamma had to file several
applications for execution, before she could finally bring
the properties to sale and in view of the heavy encumbrances
to which they were subject, she had herself to purchase them
on 2-8-1928. The sale was confirmed on 21-11-1930, and the
sale certificate, Exhibit J-5, was issued, and she got into
possession. To sum up, the claim on which the suit was laid
was true and honest; it was hotly contested by the
defendants, and prolonged proceedings in execution had to be
taken for realising the fruits of the decree. These are
facts which are eloquent to show that the suit in O.S. No.
100 of 1919-20 and the sale on 2-8-1928 were not collusive.
The plaintiff also went into the box, and stated in cross-
examination that though when he filed 0. S. No. 92 of 1938-
39 he had thought that the proceedings were collusive, he
now thought otherwise. Counsel for the appellants strongly
criticised this evidence, and contended that in the absence
of facts as to why he chanced his mind, the statement of the
plaintiff that he now thought otherwise was worthless. But
then, the plaintiff as also Abdul Huq and his legal
representatives were utter strangers, and their statement
about the collusive character of the proceedings, in O.S.
No. 100 of 1919-20 could only be a matter of inference. If
on the materials then before him the plaintiff could have
thought that those proceedings
468
were collusive, there is no reason why on the materials now
before him he could not think otherwise. It was open to the
defendants to have further crossexamined him about the
materials which led him to change his opinion, but they
chose not to pursue the matter. Both the courts below have,
on a careful consideration of the record, come to the
conclusion that the proceedings in O.S. No. 100 of 1919-20
were not collusive, and we do not see sufficient grounds for
disturbing that finding, which must be affirmed.
We shall now deal with the contention of the appellants that
in view of what happened in O.S. No. 92 of 1938-39 it is not
open to the plaintiff to plead in these proceedings that the
decree and sale in O.S. No. 100 of 1919-20 are not
collusive. It is argued that in his plaint in O.S. No. 92
of 1938-39 the plaintiff alleged that the proceedings in
O.S, No. 100 of 1919-20 were collusive, adduced evidence in
proof of these allegations, persuaded the court to give a
finding to that effect, and obtained a decree on the basis
of that finding, and he cannot therefore be permitted in
this litigation to change his front and plead that the pro-
ceedings in O.S. No. 100 of 1919-20 are not collusive and
succeed on it. This bar arises, it is argued, on the
principle that a person cannot both approbate and reprobate.
Now, the facts relating to the litigation in O.S. No. 92 of
1938-39 are that Garudachar set up title to the suit
properties under a purchase dated 1-12-1932 from Lokiah, and
it was the truth and validity of this sale that was really
in question in that suit. Lokiah purchased these and other
properties in execution of the money decree of one
Appalaraju, and therefore his title cannot prevail as
against that of Devamma under the purchase under the charge
decree on 2-8-1928. In his plaint in O.S. No. 92 of 1938-
39, the plaintiff attacked the purchases of both Devamma and
of Lokiah as fraudulent and collusive. But, in fact, as
Garudachar did not claim any title under Devamma, there was
no need to attack the purchase by her on 2-8-1928. The suit
was contested,
469
and in the judgment that was given, Exhibit E, the title of
the plaintiff was upheld and a decree granted in his favour.
There was an appeal against the decree by Garudachar, R.A.
No. 101 of 1940-41, and that was disposed of on a compromise
by the parties, under which the title of the plaintiff to
the suit properties was affirmed and Garudachar was granted
some other vacant sites in satisfaction of his claim. It is
difficult to say on these facts that the allegation of the
plaintiff that the proceedings in O.S. No. 100 of 1919-20
were collusive was either the foundation of his claim, or
that he obtained any benefit under the decree on that basis.
Counsel for the appellants sought to rely on the findings in
Exhibit E, as establishing that the proceedings in O.S. No.
100 of 191920 were collusive. But as that judgment was not
inter parties, the findings therein are inadmissible in this
litigation, and, moreover, there having been an appeal
against that judgment, the findings in Exhibit E lost their
finality, and when the parties settled their claim by
granting to Garudachar another property in substitution,
they ceased to possess any force even inter parties.
But it is argued by Sri Krishnaswami Ayyangar that as the
proceedings in 0. S. No. 92 of 1938-39 are relied on as
barring the plea that the decree and sale in 0. S. No. 100
of 1919-20 are not collusive, not on the ground of
resjudicata or estoppel but on the principle that a person
cannot both approbate and reprobate, it is immaterial that
the present appellants were not parties thereto, and the
decision in Verschures Creameries Ltd. v. Hull and
Netherlands Steamship Company Ltd.(1), and in particular,
the observations of Scrutton, L.J., at page 611 were quoted
in support of this position. There, the facts were that an
agent delivered goods to the customer contrary to the
instructions of the principal, who thereafter filed a suit
against the purchaser for price of goods and obtained a
decree. Not having obtained satisfaction, the principal
next filed a suit against the agent for damages on the
ground of negligence and
(1) (1921] 2 K B. 608.
470
breach of duty. It was held that such an action was barred.
The ground of the decision is that when on the same facts, a
person has the right to claim one of two reliefs and with
full knowledge he elects to claim one and obtains it, it is
not open to him thereafter to go back on his election and
claim the alternative relief. The principle was thus stated
by Bankes, L. J.:
"Having elected to treat the delivery to him as an
authorised delivery they cannot treat the same act as a
misdelivery. To do so would be to approbate and reprobate
the same act".
The observations of Scrutton, L. J. on which the appellants
rely are as follows:
"A plaintiff is not permitted to ’approbate and reprobate’.
The phrase is apparently borrowed from the Scotch law, where
it is used to express the principle embodied in our doctrine
of election-namely, that no party can accept and reject the
same instrument: Ker v. Wauchope(1): Douglas-Menzies v.
Umphelby(2). The doctrine of election is not however
confined to instruments. A person cannot say at one time
that a transaction is valid and thereby obtain some
advantage, to which he could only be entitled on the footing
that it is valid, and then turn round and say it is void for
the purpose of securing some other advantage. That is to
approbate and reprobate the transaction".
It is clear from the above observations that the maxim that
a person cannot ’approbate and reprobate’ is only one
application of the doctrine of election, and that its
operation must be confined to reliefs claimed in respect of
the same transaction and to the persons who are parties
thereto. The law is thus stated in Halsbury’s Laws of
England, Volume XIII, page 454, para 512:
"On the principle that a person may not approbate and
reprobate, a species of estoppel has arisen which seems to
be intermediate between estoppel by record and estoppel in
pais, and may conveniently be referred to here. Thus a
party cannot, after taking advantage under an order (e.g.
payment of costs),
(1) [1819] 1 Bli. 1, 21.
(2) [1908] A C. 224, 232,
471
be heard to say that it is invalid and ask to set it aside,
or to set up to the prejudice of persons who have relied
upon it a case inconsistent with that upon which it was
founded; nor will he be allowed to go behind an order made
in ignorance of the true facts to the prejudice of third
parties who have acted on it".
The plaintiff obtained no advantage against the appellants
by pleading in 0. S. No. 92 of 1938-39 that the proceedings
in 0. S. No. 100 of 1919-20 were collusive; nor did they
acting on those pleadings acquire rights to the suit
properties. Nor is there any question of election, because
the only relief which the plaintiff claimed in 0. S. No. 92
of 1938-39 and which he now claims is that he is entitled to
the suit properties. Only, the ground on which that relief
is claimed is different and, it is true, inconsistent. But
the principle of election does not forbid it, and there
being no question of estoppel, the plea that the proceedings
in 0. S. No. 100 of 1919-20 are not collusive is open to the
plaintiff.
3.It was finally contended that the purchase by Devamma in
execution of the decree in 0. S. No. 100 of 1919-20 was void
and conferred no title on her, because the Official Receiver
in whom the estate of Keshavananda, the mortgagor, had
vested on his adjudication as insolvent on 19-2-1926 had not
been made a party to those proceedings, and that, in conse-
quence, the title of Dr. Nanjunda Rao and his successors
under the sale deed dated 30-1-1920 continued to subsist,
notwithstanding the court auction sale on 2-8-1928. The
obvious answer to this contention is that the properties
which were sold on 2-8-1928 did not vest in the Official
Receiver on the making of the order of adjudication on 19-2-
1926., as they had been transferred by the mortgagor, long
prior to the presentation of Insolvency Case No. 4 of 1925-
26 under the very sale deed dated 30-1-1920, which forms the
root of the appellants’ title. That sale was no doubt
pendente lite, but the effect of section 52 is not to wipe
it out altogether but to subordinate it to the rights based.
on the decree in the suit. As between the
472
parties to the transaction, however, it was perfectly valid,
and operated to vest the title of the transferor in the
transferee. Under section 28(2) of the Insolvency Act, what
vests in the Official Receiver is only the property of the
insolvent, and as the suit properties had ceased to be his
properties by reason of the sale deed dated 30-1-1920, they
did not vest in the Official Receiver, and the sale held on
2-8-1928 is not liable to be attacked on the ground that he
bad not been impleaded as a party thereto.
But it is argued for the appellants that having regard to
the words of section 52 that pendente lite "the property
cannot be transferred", such a transfer must, when it falls
within the mischief of that section, be deemed to be non
est, that in consequence Keshavananda must, for purposes of
lis pendens, be regarded as the owner of the properties,
notwithstanding that he bad transferred them, and that the
Official Receiver who succeeded to his rights had a right to
be impleaded in the action. This contention gives no effect
to the words "so as to affect the rights of any other party
thereto under any decree or order which may be made
therein", which make it clear that the transfer is good
except to the extent that it might conflict with rights
decreed under the decree or order. It is in this view that
transfers pendente lite have been held to be valid and
operative as between the parties thereto. It will be
inconsistent to bold that the sale deed dated 30-1-1920 is
effective to convey the title to the properties to Dr.
Nanjunda Rao, and that, at the same time, it was Keshava-
nanda who must be deemed to possess that title. We are,
therefore, unable to accede to the contention of the
appellants that a transferor pendente lite must, for
purposes of section 52, be treated as still retaining title
to the properties.
But assuming that Keshavananda had still some interest in
the properties left even after he had sold them on 30-1-1920
and that it would vest in the Official Receiver on the
making of the order of adjudication on 19-2-1926, what is
its effect on the title of Devamma as purchaser in court
auction in execu-
473
tion of her charge decree? It has been held by the Privy
Council in Kala Chand Banerjee v. Jagannath Marwari(1) that
when in execution of a mortgage decree properties are sold
without notice to the Official Receiver in whom the equity
of redemption had vested prior to the sale, such sale would
not be binding on him. But here, it is not the Official
Receiver, who impeaches the sale as bad. In fact, he was a
party to O.S. No. 8 of 1933-34 and would be bound by the
sale in execution of the decree therein, under which the
plaintiff claims. It is the purchaser pendente lite in the
charge suit, O.S. No. 100 of 1919-20, that now attacks the
sale held on 2-8-1928 as null and void. Is he entitled to
do so? Counsel for the respondent has invited our attention
to the decision in Wood v. Surr(2). There, the mortgagor
filed a suit for redemption in 1838. A preliminary decree
for accounts was passed in 1843 and pursuant thereto, a
final decree was made in 1848 declaring the amount payable,
and time for payment was given till 1849. The amount not
having been paid, the mortgage became foreclosed. During
the pendency of these proceedings, the mortgagor was
adjudicated bankrupt in 1844, but the Official Assignee, in
whom the equity of redemption had vested, was not impleaded
in the mortgage action. In 1841, the mortgagor bad created
a further mortgage in favour of one Mrs. Cuppage, and she
was not made a party in the redemption suit. After the
foreclosure of the mortgage in 1849, one Mr. Wood claiming
in the rights of Mrs. Cuppage instituted an action to redeem
the mortgage. The question was whether being transferee
pendente lite he was bound by the foreclosure proceedings.
The contention on his behalf was that as the official
assignee was not a party to those proceedings, there had
been no proper foreclosure, and that the whole matter was at
large. In negativing this contention, Sir John Romilly, M.
R. observed:
"There can be no question but that the suit (Davis’s suit)
was defective by reason of no notice having been taken of
the insolvency. The proceeding
(1) [1927] L, R. 54 T.A. 190,
(2) [1854] 19 Beav. 551; 52 E.R, 465,
474
having gone on exactly as if no insolvency had taken place,
the subsequent proceedings would, in my opinion, be wholly
inoperative against the assigneein-insolvency and if he
thought fit to contest the validity of the decree of
foreclosure against Davis, it could not be held to be
binding on such assignee. But that does not conclude the
question, which really is, whether the plaintiff who, but
for this, would in truth have been bound, can take advantage
of this objection. I am of opinion that although the suit
was undoubtedly defective, by reason of this insolvency, the
assignee alone could take advantage of this defect. It is
obvious that Davis himself could not take advantage of it,
or if from any subsequent cause, or any subsequent
circumstance, the insolvency or bankruptcy had been
superseded or annulled, he could not have said that the
foreclosure was not absolute against him".
These observations directly cover the point now in
controversy, and they embody a principle adopted in the law
of this country as to the effect of a sale in execution of a
decree passed in a defectively constituted mortgage suit.
Such a sale, it has been held, does not affect the rights of
redemption of persons interested in the equity of
redemption, who have not been impleaded as parties to the
action as they should have been under Order 34, Rule 1,
Civil Procedure Code but that it is valid and effective as
against parties to the action. This rule has been affirmed
even when the person in whom the equity of redemption had
vested is the Official Receiver, and he had not been made a
party to the proceedings resulting in sale. Vide Inamullah
Khan v. Shambhu Dayal(1) and Subbaiah v. Ramasami
Goundan(2). We should accordingly hold that even assuming
that the equity of redemption in the suit properties vested
in the Official Receiver on the adjudication of
Keshavananda, his non-joinder in the execution proceedings
did not render the purchase by Devamma a nullity, and that
under the sale she acquired a good and impeccable title,
subject to any right which the Official Receiver
(1) A.I.R. 1931 All. 159.
(2) I.L.R. [1954] Mad, 80.
475
might elect to exercise, and it is not open to attack by the
transferee pendente lite under the deed dated 30-1-1920 and
his representatives, the present appellants. In the result,
we agree with the courts below that the title of the
appellants has been extinguished under section 52 of the
Transfer of Property Act, by the court sale dated 2-8-1928.
It must be mentioned that the appellants also pleaded that
the suit was barred by limitation under article 142 on the
ground that the plaintiff and his predecessors had not been
in possession within 12 years of the suit, and that further
the defendant had acquired title by adverse possession
commencing from 1920. The learned District Judge, found on
both the issues in favour of the plaintiff, and though the
correctness of these findings was attacked in the grounds of
appeal to the High Court, there is no discussion of the
question in the judgment of the learned Judges, and we must
take it that the point had been abandoned by the appellants.
We accordingly declined to hear them on this question. We
may add that the question of limitation cannot really arise
on the facts of this case, inasmuch as the possession which
is claimed to be adverse is stated to have commenced in
1920, and it is well settled that such possession cannot
affect the right of a prior mortgagee to bring the
properties to sale, and adverse possession against the
purchaser under that sale cannot commence prior to the date
of that sale, and the present suit was instituted on 8-1-
1945 within 12 years of the sale, which took place in
1936.
The appeal fails, and is dismissed with costs.
62
476