THAN SINGH Vs. NANDU KIRPA JAT

JUDGEMENT

(1.) THE facts from which this reference to Full Bench has arisen are as follows:-Than Singh, plaintiff (since deceased) brought a suit for possession by pre--emption of the land which was given in exchange by Smt. Saraswati to Nandu, claiming himself to be the brother of the deceased husband of Smt. Saraswati, alleging that the transaction was virtually a sale in the guise of an exchange and that it was done to defeat his pre--emptive right, because on the same day Smt. Saraswati executed a sale--deed, Exhibit D--2, in favour of Gordhan, brother of Nandu, in respect of the land she got in exchange from Nandu and the sale money mentioned in the sale deed was Rs. 2,000. Nandu defendant contested the suit and, controverting the allegations in the plaint, pleaded that the transaction in question was in fact an exchange and not sale and that the plaintiff had no right of pre--emption. The parties contested on the following issues:-

(2.) WHEN this second appeal came before me on 27th April, 1977. I thought it necessary to refer it to a Full Bench in view of the fact that there appeared to be conflict of authorities reported as Gul Muhammad v. Sabz Ali Khan, 104 PR 1918: (AIR 1919 Lah 127), on one hand and Narain Singh v. Waryam Singh, AIR 1921 Lah 192 and Rati Ram v. Mam Chand, AIR 1959 Punj 117, on the other, and while referring the case to a Full Bench, it was observed as under:-" Since there is conflict of views in the above three Division Bench authorities, and in the context of the modern changed socio--economic conditions, the pre--emption law is being considered as an outmoded law because it creates a clog on the right of the owner to alienate his property to a person of his own choice. , it has, therefore, to be strictly construed. Moreover, according to the definition of the term 'sale' as well as that of the term 'exchange' as given in Ss. 54 and 118 respectively of the T. P. Act, the document Exhibit D--1, on plain reading, clearly answers the definition of exchange. I am, therefore, of the view that the law as laid down in 104 PR 1918: (AIR 1919 Lah 127) Gul Muhammad's case (supra) needs reconsideration by a larger Bench. "

(3.) THE sole question for determination in this second appeal before us is whether in a pre--emption suit the Court can enquire into the true nature of a transaction which is apparently an exchange in order to determine that in fact it is a sale and not an exchange and allow the pre--emptor to lead evidence to prove the same. There is no dearth of authorities and the basic authority on this point is Tara Chand v. Baldeo, 117 PR 1890 (FB ). As early as in 1889 in a pre--emption case a question arose whether a certain transaction in the form of a gift was really a sale and whether the Court could go behind the document and it was held by their Lordships of the Full Bench that in the case of an alienation of land, in which a document has been executed purporting to be a deed of gift or of mortgage it is open to a third party claiming to exercise a right of pre-emption to prove that the transaction was in reality one of sale, and that the document sought to be impugned was executed in order to conceal its real nature and to defraud him of his legal rights. Their Lordships in the same judgment also observed that a person is entitled to evade the law of pre--emption by all lawful means and that it is quite open to a proprietor of land to mortgage his estate for an indefinite period although he would have sold it but for the law of pre--emption.