ABHEY RAM Vs. UMRAO SINGH CH

JUDGEMENT

(1.) THIS is a defendants' second appeal in a suit for specific performance of an agreement to sell certain immovable property in the nature of Bhumidhari rights in land by the defendant-respondents Nos. 2 and 3 in favour of plaintiff-respondent No. 1. The agreement was executed on the 14th August 1965 and the sum of Rs. 3000/- was paid as earnest money at the time of the execution of the agreement. The total amount of considera tion agreed to between the parties was Rs. 6000/-. The trial Court dismissed the suit for specific performance on the finding that the defendant-appellants had subsequently purchased the property in suit bona fide, for value and with out notice of the agreement to sell in favour of the plaintiff respondent No. 1, but decreed the suit for recovery of Rs. 3000/- with pendente-lite and future interest at 6% per annum against the defendants Nos. 1 and 2 who are the respondents Nos. 2 and 3. On appeal by the plaintiff-respondent the lower appellate Court modified the decree of the trial Court, by decreeing the claim for recovery of Rs. 3000/- with pendente-lite and future interest at 6% per annum against the present defendant-appellants also, and declaring and en forcing a statutory charge under Section 55 (6) (b) of the Transfer of Property Act against the property in suit which they had purchased subsequently, but bona fide and without notice of the agreement to sell. The only point pressed before me in this appeal by the learned counsel for the appellants, accordingly, was that a charge, if any, could not be enforced against a bona fide transferee for value without notice. He relied on Section 100 of the Transfer of Property Act and urged that although a statutory charge may have arisen under Section 55 (6) (b) of the Transfer of Property Act, nevertheless, it could not be enforced because of the exception made by Section 100 thereof in favour of the person to whom the property has been transferred for consideration and without notice of the charge. He urged that the enforcement of all statutory charges, Including that created by the operation of Section 55 (6) (b), it governed by Section 100 of the Transfer of Property Act. The learned counsel, for the plaintiff- respondent on the other hand urged that the words- "with notice of the payment" which found place in sub-clause (b) of clause (6) of Section 55 of the Transfer of Property Act, were deleted by Act 20 of 1929, and the effect of deletion of these words was that the charge of the buyer for the price paid, was enforceable not only against the seller but against all persons claiming under him irrespective of any want of notice. Learned counsel for the plaintiff-respondent relied on the decision of a learned Single Judge of this Court in Smt. Shantt Devi v. Amarnath Second Appeal No. 753 of 1963, (decided on August 17, 1977) in support of the proposition that Section 55 (6) (b) applied also to an executory contract of sale. However, the question whether the charge created by Section 55 (6) (b) could be enforced also against a subsequent transferee for valuable consideration and without notice of the contract under which the purchase money was paid, notwithstanding the provisions of Section 100, does not appear to have directly canvassed in that case, although there are observations in that judgment to the effect that the question of notice in abso lutely irrelevant so far as Section 55 (6) (b) is concerned and that this position has been made clear by the deletion of the words "with notice of the pay ment", by the Transfer of Property (Amendment) Act, 1929. Besides the said deicing, we have the authority of a Full Bench of this Court in Deep Chan dra v. Sajjad All Khan A.I.R. 1951 Alld. 93. (F.B.), for the proposition that the language of Section 55 (2) of the Transfer of Property Act is applicable both to a conveyance and a contract of sale. It may, therefore, be taken to be settled that the provisions of Section 35 (6) (b) of the Transfer of Property Act apply not only to a com pleted conveyance where the seller does not deliver the property sold to the buyer, but also to executory contracts of sale where the seller in breach of the contract transfers the property and delivers it to a third person. It follows that a buyer who fails to get delivery of the property under the contract, is entitled, unless it is shown that he had improperly declined to accept delivery, to a charge on the property against the seller and all persons claiming under him to the extent of the seller's interest therein for the amount of any pur chase money properly paid in anticipation of the delivery of the property and for interest on such amount. The question which remains is, whether despite the deletion of the words "with notice of the payment" after the words "all persons claiming under him," such charge could be enforced against a subse quent transferee for valuable consideration without notice of the contract of sale, in view of the provisions of Section 100 of the Transfer of Property Act. It is indisputable that specific performance of a contract of sale of immovable property cannot be enforced against a subsequent transferee for valuable consideration who has purchased the property bona fide and without notice of the contract ; but if a person purchases a property with notice of a subsisting contract of sale in favour of another, the contract can be specifically enforced against the subsequent purchaser as well, and in a suit for specific performance of that contract the subsequent purchaser is also directed to execute the conveyance, although he was no party to the contract of sale, sub ject to the equitable rule that the unpaid purchase money is directed to be paid by the original buyer under the contract of sale, not to the original seller there under but to the subsequent transferee. But where the subsequent trans feree establishes his bona fides and want of notice of the contract of sale, the contract ceases to be specifically enforceable. That is precisely what has happened in the present case and the decree for specific performance has been refused on the ground that the defendant-appellants had no notice of the contract of sale by the defendant-respondents Nos. 2 and 3 in favour of the plaintiff-respondent No. 1. Section 100 of the Transfer of Property Act, with particular reference to statutory charges, came up for consideration by the Supreme Court in Ahame-dabad Municipality v. Haji Abdul Gafur A.I.R. 1971 S.C. 1201. The Supreme Court held : "THIS Section in unambiguous language lays down that no charge is enforce able against any property in the hands of a transferee for consideration without notice of the charge except where it is otherwise expressly provided by any law for the time being in force. The saving provision of law must expressly provide for enforcement of a charge against the property in the hands of a transferee for value without notice of the charge and not merely create a charge", (page 1203 column 1). The question in that case arose in the context of the first charge created on property for payment of tax under Section 141 of the Bombay Provincial Municipal Corporation Act, 1949. The Supreme Court held that sub-section (1) of Section 141 of that Act merely created a charge in express language, and the charge was subject to prior payment of land revenue due to the State Government on. the building or land but, apart from creating a statutory charge, it did not further expressly provide that his charge is enforceable against the property chaired in the hands of a transferee for consideration without notice of the charge. A full Bench decision of our Court in Nawal Kishore v. Municipal Board, Agra A.I.R. 1941 All. 115, along with some other decisions was overruled by the Supreme Court and it was held that the first charge created by statute on property for recovery of the unpaid property tax could not be enforced against bona fide transferees for value without notice of the charge. The question, therefore, boils down to the narrower question whether the omission of the words "with notice of the payment" which qualified the phrase "all persons claiming under him" (the seller), had the effect of express ly imposing a statutory charge even against bona fide transferees for value without notice of the pre-payment of the purchase price or of the contract under which it was paid by the original buyer to the seller, such as to nullify the protection afforded to them by the second paragraph of Section 100 of the Transfer of Property Act, in the matter of enforcement of the charge against them. The lower appellate Court has in this context quoted from the reasons for amendment of Section 55 (6) (b) by Act XX of 1929, was stated by the Special Committee, and has relied on the decisions of the Bombay High Court in Hari Bapuji Patankar v. Bhagu Sadhu Birje and another A.I.R. 1937 Bora. 142, and Abdul Hamid Khan v. Mohammad Ali A.I.R. 1952 Bom. 67, and also on the aforesaid decision of this Court in Lala Nawal Kishore v. Municipal Board, Agra A.I.R. 1943 All. 115. The decision in Nawal Kishore's case, it has already been seen above, was overruled by the Supreme Court in the case of Ahmedabad Municipal Corporation supra). The Bombay decisions in the cases of Hari Bapuji Patankar v. Bhagu Sadhu Birje and anor/jer(supra) and Abdul Hamid Khan v. Mohammad Alt (supra) ; must also be deemed to be no longer good law. In view of the ratio-decidendi of the Supreme Court ruling in the case of Ahmedabad Municipal Corporation, inasmuch as if the language of Section 141 of the Bombay Provincial Municipal Corporation Act, 1949, was found by the Supreme Court not to be express enough to war rant enforcement of the statutory charge imposed by that Section against property in the hands of a transferee for value without notice of the charge, within the meaning of the second paragraph of Section 100 of the Transfer of Property Act, it can with equal justification be urged that the language of Section 55 (6) (b) of the Transfer of Property Act, as it now stands after the omission of the words "with notice of the payment" does not expressly provide for enforcement of the statutory charge created thereby against property in the hands of a transferee for value without notice of the charge, within the meaning of the second paragraph of Section 100 of the Transfer of Property Act. By the omission of the words "with notice of the payment" the provi sions of Section 55 (6) (b) do impose a statutory charge for the prepaid pur chase money on property in the hands of all persons claiming under the seller irrespective of whether they have had notice of the charge or not, but by the very same Act 20 of 1929 the second paragraph of Section 100 of the Transfer of Property Act was also amended to read as it now does. The imposition of the charge against the property in the hands of purchasers for value without notice, was the implied result of the omission of the words "with notice of the payment" in Section 55 (6) (b). But it cannot be said that the provisions of Section 55 (6) (b) as they stand after the amendment, expressly provide for enforcement of the charge against the property even in the hands of a person to whom it has been transferred for consideration and without notice of the charge. The learned District Judge, in my opinion, fell into an error in hold ing that the specific provisions of Section 55 (6) (b) must prevail over the general provisions of second paragraph of Section 100. Even here, in so far as the creation of the charge is concerned, the specific provision to be looked to is Section 55 (6) (b). By reason of that provision the charge for refund of the pre-paid purchase price is created on property in the hands of the seller and all persons claiming under him, irrespective of whether they have any notice of the pre-payment of the purchase price by the original buyer to the seller ; but when it comes to enforcement of that charge the specific provision to be looked to is Section 100 of the Transfer of Property Act : and that Sec tion after providing for the manner of enforcement of a charge against pro perty, provides by the second paragraph, that no charge, whether statutory or otherwise, shall be enforced against any property in the hands of a person to whom such property has been transferred for consideration and without notice of the charge, save as otherwise expressly provided by any law for the time being enforced. In my opinion Section 100 is the specific provision which applies to enforcement of a charge, and not Section 55 (6) (b) which merely creates the charge. For this reason also it has to be held that the statutory charge created by Section 55 (6) (b) for refund of prepaid purchase price can not be enforced against the property in the hands of a subsequent transferee for valuable consideration without notice of the charge. In the result the appeal succeeds and is allowed with costs. The judg ment and decree of the lower appellate Court are set aside and the decree of the trial Court is restored.