GAYASI RAM Vs. SHAHABUDDIN

JUDGEMENT

(1.) This is a Letters Patent appeal by the plaintiffs who have lost their suits in both the lower Courts and before the learned Single Judge of this Court. On 3rd July 1912, Bhuja Ram, father of the plaintiff, Gayasi. sold a house to Nanhu, the father of Ramsaruip, defendant 3, for the sum of Rs. 150. In that sale-deed there was a clause providing that the vendee would not transfer the house by mortgage, gift or self to anyone excepting the vendor or his heirs; that if the house were sold by auction-sale the sale would be invalid; and that if the house were transferred in contravention of the said terms then the vendor or his heir would have a right to get back the house by paying Rs. 175. On 13 April 1928, Ramsarup, son of the vendee sold the house to defendant 2, Raja Ram, for Rs. 1,000. On 3 April 1929, Raja Ram, sold the house to defendant 1, Shahabuddin, for Rs. 800. On 12 April 1929, the plaintiffs have brought the present suit against all the defendants claiming possession, of the house on payment of Rs. 175 to defendant 1. The Court is below dismissed the suit on the ground that the condition was contrary to Section 10. T.P. Act as amounting to an absolute restraint on alienation. That view has been upheld by the learned Single Judge of this Court. Learned Counsel in Letters Patent appeal relies on certain rulings which he claims will show that in similar cases it has been held that such conditions are not contrary to Section 10, T.P. Act. The first ruling on which he relied is a Full Bench ruling in Aulad Ali Vs. Athar 1927 All. 170. Learned Counsel points out that the contract in that case quoted in the foot-note at the bottom of p. 530 (of 49 All 527), amounts in effect to the same result as the contract in the present case. The contract in that case is as follows: I, Saiyid Muhammad Razi, cannot transfer the said share by sale or mortgage. If I, Saiyid Muhammad Rani, wish to transfer the remaining one pie (English) share or if I, Sheikh Nasiruddin, wish to transfer the whole or part of my share in mauza Gurdih aforesaid, wo can transfer it among ourselves, that is, one executant can transfer it to the other. In case of transfer to another person, the other executant will acquire it by pre-emption on payment of consideration at the rate of Rs. 8-5-4 for each pie (English) in case of sale and on payment of Rs. 4-2-8 for each pie (English) in case of other transfers.

(2.) I would, note firstly that the contract in the ruling differs because it does not state that alienation shall not take place. It sets out that a transfer may be made between the parties and further provides that if a transfer is made to another person then the opposite party will acquire the property by preemption. The pre- emption differs from the usual contract for pre-emption because the rate at which the purchase is to be made is fixed by the agreement. But in dealing with this case the Full Bench did mot lay any stress on this particular condition that the price was fixed. On the contrary the Full Bench treated the case as one of a contract creating a right of preemption. On p. 530 the acting Chief Justice stated, after quoting the contract and stating that it gave the right to pre-emption: That is a perfectly harmless and natural mutual arrangement, very common in India, quite intelligible, the object being that so long as the parties to the transaction preferred to keep out third persons from the body of co-sharers, they should have a right of veto.

(3.) On p. 528 it is stated that each of the parties was the owner of an eight anna share in a certain village and one party transferred all his eight-anna share with the exception of a one pie share to the other. Again at the bottom of p. 532 the learned acting Chief Justice objected to the application of the equitable rule of "analogy to the statute" to pre-emption contracts, that is he treated the present contract as one of pre-emption. The second point on which the Full Bench ruling is distinguishable is that in no part of that ruling has any reference been made to Section 10, T.P. Act. The case was not put forward that the contract in that ruling would amount to an absolute restraint on alienation. As the case was not argued on that ground I consider that it cannot be held that the ruling is an authority for the proposition that Section 10 does not apply to a contract of that nature. It should further be noted that in the ruling the case was one between co-sharers in a village. In. the present case the property in suit is not zamindari property, but a house and the parties are in no sense co-sharers, nor can there be any question of pre-emption by a contract. The next ruling on which learned Counsel relies is a ruling of their Lordships of the Privy Council reported in Mahomed Raza V/s. Abbas Bandi 1932 P.C. 158. That ruling sets out that on 19 September 1870, there was a compromise which stated: It has been settled that both wives should, in accordance with this agreement, in their capacity as wives, from this time be declared permanent owners of a moiety each of the entire mahal Shadipur.... The said females shall not have power to transfer this property to a stranger.