JOGENDRA KISHORE ROY Vs. SALAMAT KHAN

JUDGEMENT

(1.) This is an appeal by the plaintiff and it arises out of a suit for foreclosure. It appears that the principal defendant mortgaged the property now in suit by way of conditional sale to the pro forma defendant on 4 Jaista 1325 B.S. The mortgagee, that is, the pro forma defendant Nabi Bux sold or assigned over the mortgage bond to the plaintiff on 1 January 1924. The present suit to enforce the mortgage by way of conditional sale by foreclosure was instituted on 28 August 1924. The principal defendant mainly contended that the mortgage bond itself and the sale thereof in favour of the plaintiff were both void for want of consideration. The defence further was that the plaintiff was not a bona fide purchaser for value. The Court of first instance held that the mortgage bond was for consideration and that the plaintiff was also a bona fide purchaser for value. It accordingly decreed the plaintiff's suit and passed the usual preliminary decree for foreclosure. Against this decision, an appeal was taken to the Court of the Subordinate Judge by the principal defendant and the learned Subordinate Judge has reversed the decision of the Munsif holding that the kot kobala or the mortgage by way of conditional sale was a benami transaction, that it was without consideration and that, Nabi Bux - the pro forma defendant and Rahimuddi - an enemy of the principal defendant combined together to put the principal defendant into trouble. The Subordinate Judge accordingly dismissed the plaintiff's suit. A second appeal has been taken to this Court by the plaintiff and the main contention of the learned advocate for the appellant has been that there has not been a proper disposal of the appeal before the lower appellate Court as it has not come to any conclusion on the question whether the plaintiff was or was not a bona fide purchaser for value. It is contended that the plaintiff was entitled to a decree on the mortgige if he could establish that he was a bona fide purchaser for value without notice, even if no consideration passed for the mortgage bond of 4 Jaista 1325 B.S. Mr. Bimal Chunder Das Gupta who appears for the plaintiff-appellant has urged with great insistence that his contention proceeds on and finds support from the provisions of Section 41, T.P. Act. He contends that Section 41 not only protects the ostensible owner who is held up to the outside world by the persons interested in immovable property as such owner but also the mortgagee of such person interested in the property. I am, however, unable to agree to this contention. Section 41 runs as follows: Where, with the consent, express or implied, of the persons interested in immovable property, a person is the ostensible owner of such property and transfer the same for consideration, the transfer shall not be voidable on the ground that the transferrer was not authorized to make it; provided that the transferrer, after taking reasonable care to ascertain that the transferrer had power to make the transfer, has acted in good faith.

(2.) Applying this section to the facts of the present case, it appears that the principal defendant, that is, the mortgagor was the person who was interested in the immovable property in question and, with his consent express or implied, the pro forma defendant Nabi Bux was not the ostensible owner of such property but was the ostensible mortgagee of such property. In order to give effect to the contention of the learned advocate for the appellant, the word "owner" in Section 41 would have to be replaced by the word "transferee." "The persons interested in immovable property" in my opinion, mean the full owners or the owner which in this case the mortgagor defendant was and the transfer must be by the ostensible owner, that is, by a person who is apparently a full and unqualified owner of the property and not by a mortgagee. It is then contended that, even if Section 41 does not in terms apply, the same principle ought to govern the present case. I am unable to agree to this contention also; for, when the legislature has provided for one state of things expressly limiting it to the case of a full owner, it cannot be said that it was the intention of the legislature also to include a person who has not got the full rights of ownership. No question of equitable principle comes in where the legislature who evidently knew the distinction between an owner and a transferee having lesser rights use the word "owner." Looking to the history of this section, it appears that it really gave effect to the decision of the Judicial Committee in the case of Ram Coomar Koondoo V/s. Maria McQeen I.A. Sup. Vol. 40 where it was said that, if a person being the owner of a property allows another person to hold himself out as the ostensible owner of such property he cannot afterwards be permitted to challenge the transactions entered into by the ostensible owner for valuable consideration and without notice of his secret title. If the contention of the learned advocate for the appellant is to be given effect to the result will be that even in a case where the mortgage is collusive, the mortgagee is simply to transfer it to a third party in order that such assignee may be relieved from proving that consideration passed for the mortgage. A mortgagee or the assignee of a mortgagee has, in order to get a decree for enforcement of the mortgage, to proceed on certain lines provided for by the Transfer of Property Act. He has to establish in a Court of law that the mortgage was for consideration; and this, in the findings of the lower appellate Court, the plaintiff has failed to do in the present case. In these circumstances, I fail to see how he can get a mortgage decree against the original mortgagor. In this view of the matter, I am of opinion that the decision of the lower appellate Court is right and ought to be confirmed. The appeal is accordingly dismissed; but, in the circumstances of the case, no order should be made as to the costs of the appeal. Jack, J.

(3.) I agree with my learned brother that in this case, the decree of the lower appellate Court ought to be affirmed and this appeal dismissed for the reason that the findings of the learned Subordinate Judge seem to indicate that the transferee did not act in good faith and, therefore, Section 41, T.P. Act does not apply. Those findings are (1) that the plaintiff Jogendra has got no land near the bond land, (ii) that there is no sufficient reason for the plaintiff to have taken the land and (iii) that he admitted in the first instance in his deposition that he did not purchase any bond. I regret, however, that I cannot agree with my learned brother as to the applicability of Section 41, T.P. Act. It appears to me that inasmuch as the interest of a mortgagee is itself immovable property where the owner of that property transfers it, the rights of a bona fide purchaser for value from the ostensible owner of that property that is to say the purchaser of the mortgagee's right would be protected under Section 41, T.P. Act. The purchaser of a portion of the rights of the owner of immovable property from the ostensible owner to whom such rights have been transferred would be protected under the Act and similarly the bona fide purchaser of the mortgagee's rights from their ostensible owner to whom they have been transferred by the owner of the property should be protected under Sec. 41, T.P. Act. However, in this case, for the reasons given, I think the [decree of the, lower appellate Court should be upheld and this appeal dismissed. There will be no order as to the costs of the appeal.