RAKHAMA SITARAM GHADGE Vs. LAXMAN SITARAM GHADGE

JUDGEMENT

(1.) The dispute in this appeal relates to two lands - Survey Nos. 155/5 and 155/6 of the village of Kandali, Taluka Junnar, district Poona. the lands originally belonged to the plaintiff. By a conveyance, dated 17-1-1951 the plaintiff sold these lands to the first defendant for Rs. 500. The first defendant then executed an agreement in favour of the plaintiff, who it may be noted is his full brother, whereby he contracted to re convey the lands to the plaintiff at any time on repayment of Rs. 500. On 13-11-1954 the plaintiff served a notice calling on the first defendant to re convey the property pursuant to the agreement., dated 17-11-1951, but the first defendant declined to carry out the requisition. The plaintiff then filled Civil Suit No. 16 of 1955 in the court of the Civil Judge, Junion Division, Junnar, for a decree for specific performance of the agreement. To that suit, Krishanabai - wife of the first defendant - was impleaded as the second defendant on the allegation that she was managing the property on behalf of the first defendant. The suit was resisted by the first defendant who contended that the condition relating to reconveyance to the property at any time was fraudulently incorporated in the agreement. The first defendant submitted that it was agreed between the parties that the condition relating to re conveyance of the property was to be enforced within one year only from the date of the agreement. The learned trial judge negatived the contentions raised by the first defendant and decreed the plaintiffs, claim for specific performance. In appeal to the District court at Poona, the decree passed by the trial court was confirmed. A second appeal against that decision was summarily dismissed by Mr. Justice Datar. But Mr. Justice Datar thereafter granted leave to the first defendant to appeal under clause 15 of the Letters Patent.

(2.) Mr. Jadhav who appears on behalf of the first defendant contends that the agreement to reconvey the propertyy to the plaintiff on demand at any time after 17-1-1951 infringes the rule against perpetutiy enunciated in Section 14 of the Transfer of property Act and on that account the covenant to reconvey the property is void. In support of his contention Mr. Jadhav relies upon a judgment of Division Bench of this court in Dinkarrao Ganpatrao v. Narayan 24 Bom LR 449: (AIR 1922 Bom 84) But under the Trnasfer of property Act an agreement to sell immoveable property does not. of itself create any interest in or charge on such property. the rule against perpetuity prohibits the creation of certain remote interest in immoveable property. It is then difficult to appreciate how by an agreement. which does not create an interest in or charge on immoveable property. the rule against perpetuity can be regarded as infringed.

(3.) In Dinkarraos case, 24 Bom LR 449: (AIR 1922 Bom 84) a plot of land was agreed to be sold under a deed of slae, dated 18-9-1878, and there was a covenant in the sale deed that if the vendee or his heirs desired to sell the plot the same was to be resolved to the vendor at the price mentioned in the sale deed. Relying upon this covenant. the heirs of the vendor took out an Orgininating Summons for determining the rights of the heirs of the vendee. It was held by Mr. Justice Pratt, that the covenant contained in the sale deed was a personal contract and created no rights in rem affecting the title of the cendee, and that no declaration of the rights under a personal contract could be made. Against the decision of Mr. Justice Pratt an appeal was preferred and it was held in appeal that the covenant in question was void and the heirs of the vendee were entitled to a declaration to that effect. The court expressly held that prior to the Trnasfer of Property Act, 1882, which was applied to the Bombay presidency as from 1-1-1893, a contract for sale of immoveable property created an equitable interest in the property and made the purchaser the owner in equity and the covenant for pre emption in the sale deed was void as infringing the rule against perpetuties. Macleod C.J. also claimed to approach the case from another angle. He observed that although contracts for the sale of land which can be specifically enforced immediately or contracts creating a right of pre emption which cannot be specifically enforced util the proper occasion arises in the future do not according to the law in India create an interest in land either equitable or executory, they do create rights which are capable of being enforced with regard to the land in certain circumstances against third parties and to that extent they are not ordinary personal contracts and stand in a category by themselves. He further observed that the principles which underlie the rule of perpetuties applied to this class of contractgs. Mr. Justice Kanga who delivered a supplementary judgment observed that the law laid down in London and South Western Railway co. v. Gomm, (1882) 20 Ch. D. 582 applies to a contract for sale of immoveable property in India even where the Transfer of Property Act is in force. But Gomms case was expressly decided on the ground that under the law appllicable to real property in England a contract of sale creates an executory interest or estate and is therefore subject to the rule against perpetutities.