Kedar Nath Lal & ANR Vs. Ganesh
Ram & Ors  INSC 220 (5 September 1969)
05/09/1969 HIDAYATULLAH, M. (CJ)
HIDAYATULLAH, M. (CJ) SHELAT, J.M.
CITATION: 1970 AIR 1717 1970 SCR (2) 204 1969
SCC (3) 787
CITATOR INFO :
R 1973 SC 569 (16,36) RF 1978 SC1217 (15)
Transfer of Property Act (4 of 1882), s.
52---Doctrine if lis pendens-Applicability Release by Cooperative Society of
properly from mortgage--Effect of.
One R executed a mortgage of his share in two
survey Nos. to a Cooperative Society. On his application and in order to enable
him to repay a sum of Rs. 500/-, the Society released the property in 1933, but
R never paid the amount to the Society. The Society filed an application for a
mortgage award on April 5, 1934 and the Assistant Registrar made an award in
the nature of a preliminary decree, on December 16, 1934. Thereafter a final
mortgage decree was passed by the Assistant Registrar and the two survey nos.
were brought to sale and purchased by the.
Society and possession was obtained on July 20, 1937. Meanwhile, one D obtained
attachment before judgment of the two survey nos., as the property of R, in a
suit for money against R, and, in execution of the money decree, purchased the
two survey nos. on August 13, 1934. In 1943, the Society went into liquidation
and the liquidator sold the properties of the Society and the appellant bought
the two. survey nos. He filed a suit for a declaration of his title and
possession of the properties in the two, survey nos. from various persons who
were in possession of the properties under R and D. The High Court dismissed
In appeal to this Court,
HELD: (1) The motive of the release, in 1933,
of the properties by the Society in favour of R was the payment of Rs. 500/- by
R to the Society, but it was not a condition Of the release. Therefore, the
release was binding on the Society. [209 D--E] (2) But R did not object to the
inclusion of the items in the mortgage award. Therefore, the Society must have
bona fide felt that the properties remained encumbered. [211 G] (3) The
proceedings in respect of the mortgage were pending from April 5, 1934 to July
20, 1937. The proceedings were for obtaining a mortgage award equivalent to a
mortgage decree and not for a money decree. The fact that they were attached
before judgment in D's suit does not affect the application of the doctrine of
Attachment is only effective in preventing
alienation and does not create title to property. If in fact, the property was.
acquired pendent lite, the acquirer is bound by the decree ultimately obtained.
Therefore, D's purchase on August 13, 1934, was hit by the. doctrine. of lis
pendens in s. 52 of the Transfer of Property Act, 1882. Since D's purchase was
hit by the doctrine the properties continued to be those of the Society and
hence, the appellant was entitled to them. [210 E, G--H; 211 A--C] 205
Samarendra Nath Sinha & Anr. v. Krishna Kumar Nag,  2 S.C.R. 18,
Moti Lal v. Karrab-ul-Din & Ors. 24 I.A.
170 and Gouri Dutt Maharaj v. Sukur Mohammed and Ors. 75 I.A. 165, applied.
CIVIL APPELLATE JURISDICTION: Civil Appeals
Nos. 1091-1103 of 1964.
Appeals from the judgment and decree dated April
17, 1957 of the Patna High Court In Second Appeals Nos. 1447 of 1950 etc.
C.B. Agarwala and D. Goburdhun, for the
appellant (in all the appeals).
U.P. Singh and K.C. Dua, for respondents Nos.
3 and 4 (in C.A. No. 1091 of 1964) respondent No. 3 (in C.A. No. 1092 of 1964)
respondent No. 4 (in C.A. No. 1093 of 1964), respondent No. 7 (in C.A. No..
1094 of 1964), respondent No. 3 (in C.A. No. 1096 of 1964) respondents Nos. 4
and 5 (in C.A. No. 1095 of 1964) and respondent No. 4 (in C.As. Nos. 1099, 1100
and 1101 of 1964).
The Judgment of the Court was delivered by
Hidayatullah, C.J. These are 13 appeals by certificate against the common
judgment in second appeal, April 17, 1957, of the High Court of Patna. The
appellants are the original plaintiffs. The appellants had filed 12 title suits
for ejectment in the court of the Second Munsif at Buxar.
Eleven suits were dismissed. It was held that
the plaintiffs had no title to suit lands. One suit was compromised and decreed
in terms of the compromise. Two other suits--one by Kedar Nath (one of the
plaintiffs in the 12 title suits) and the other by one Udholal were filed for
rent for 1335-1337 Fasli in respect of some lands comprised in Survey No. 3385
of Mouza Buxar against the tenant Ram Chhabi Lal. The two rent suits were heard
together. Kedar Nath was held to be the landlord and not Udholal. The suit of
the former was decreed and that of the latter dismissed.
On appeals filed by Udholal the decision was
Appeals by Kedar Nath to the High Court were
dismissed on the ground that in the title suits from which eleven appeals were
filed it was held by the High Court affirming the decision of the courts below
that Kedar Nath had no title.
Since the success of the last two appeals
depended on whether Kedar Nath had title or not it is not necessary to refer to
them at this stage. We shall deal with the other eleven appeals first.
in these appeals, plaintiffs and defendants 1
to 3 are common. Plaintiffs are purchasers from the mortgagees of the suit 206
lands who had purchased the suit lands in an auction-sale in execution of the
mortgage decree. Defendants 1 to 3 were the former owners of these suit lands
and the other defendants were either purchasers at auction-sales in execution
of money decrees against the owners or transferees from the auction-purchasers.
The suits concern plots formed out of two
Survey Nos. 3384 and 3385. It is thus that the other two suits get connected
with the title suits because in those suits the rent of certain plots from Survey
No.. 3385 was involved.
The history of the plots is as follows :--
One Laxmi Narain was the previous owner of these 2 Survey Nos. On his death his
daughter's sons Ram Narain Ram, Sheonarain Ram and Gopal Ram inherited these
Survey Nos. alongwith other properties. The first two sons were defendants 1 to
2 in the suits and defendant 3 is the son of Sheonarain Ram. In 1930 the other
two brothers sued Gopal Ram for a partition. Preliminary decree was passed on
April 15, 1931 and the final decree on September 10, 1932. Half share in the
property went to Gopal Ram and the other half jointly to the other two
brothers. The suit Survey Nos. came to the share of Ram Narain Ram and
On April 27, 1931 Ram Narain Ram executed a
mortgage of a half share in 27 plots made in the two Survey Nos. and some other
property with Buxar Trading Co-operative Society.
On April 20, 1933, the Society released Ram
Narain Ram'S share in the 27 plots from the mortgage by a registered release
deed. On September 20, 1932 Sheonarain Ram filed a suit for 'partition against
Ram Narain Ram. The preliminary decree was passed in May 1933, that is to say,
after the release by the Society. The two brothers divided the two Survey Nos.
half and half between them. No final decree in this partition suit seems to
have been passed.
Devendra Nath (one of the defendants)
obtained settlement of 3 k 13 d of land out of Survey No. 3384 from Sheonarain
Ram on June 10, 1933 and in execution of a money decree against Ram Narain Ram
and Sheonarain Ram purchased on August 13, 1934 the remaining portion of Survey
No. 3384 and Survey No. 3385. He obtained possession on February 27, 1935. He
had obtained attachment of the two plots before judgment, on April 23, 1934.
Devendra Nath disposed of 3 k 13 d by settling them on his wife and she was one
of the defendants in the suits. Devendra Nath's title depends on whet.her the
release by the Society was valid and binding on the Society or not. If the
release was valid and binding on the Society, the Society could not obtain a
decree in respect of these two Survey Nos. and bring them to sale.
207 This is one of the points for
consideration in these appeals. The High Court and the court below have decided
unanimously that the release was binding on the Society and Devendra Nath
obtained no title.
On April 26, 1934, that is to say, before
Devendra Nath's purchase but after attachment by him, the Society applied to
,.he Registrar, Co-operative Societies for a mortgage award. In that
application the surety of Ram Narain Ram was also joined. On August 16, 1934 a
money- award was given against Ram Narain Ram and his surety. On September 20,
1934 the money award was cancelled and a preliminary mortgage award was passed.
Admittedly the mortgage award had the force of a mortgage decree. The final
mortgage award was made on May 28, 1935. The award ordered sale of all
.mortgage properties including the half share of Ram Narain Ram in survey Nos.
3384 and 3385. No mention was made of the earlier release of the Survey Nos.
by the Society by a registered deed. In
execution of the decree the Society purchased the two Survey Nos. on February
7, 1936 and obtained possession on July 20, 1937.
One Dwarikanath had a money decree against
the Society and he attached the two disputed Survey Nos. and brought them to
sale. The Buxar Central Co-operative Bank purchased the two Survey Nos. in
auction-sale on February 8, 1940 obtaining possession on July 5, 1941. On March
28, 1943 the Society and the Bank went into liquidation. The right, title and
interest of the Society and the Bank was sold by the common Liquidator to Kedar
Nath including the 27 plots made in the two Survey Nos. Kedar Nath's purchase
was on March 20, 1943 but he took the sale benami in the name of Dhanesar Pandey,
who was plaint. ill No. 2 in the title suits while Kedarnath was plaintiff No.
1. The title of the plaintiffs Kedar Nath and Dhanesar Pandey is based on this
purchase. After the release of the two Survey Nos. by the Society, Ram Narain
Ram and Sheonarain Ram, and after his purchase, Devendra Nath, made settlement
of the plots to various persons. They are the remaining defendants in the suits
and respondents in the various appeals before us. The High Court has given a
chart of these persons and the dates of pattas but as nothing turns upon these
details it is not necessary to mention them here.
The plaintiffs (Kedar Nath and Dhanesar
Pandey) in these title suits asked for declaration of title and possession.
Their case was that the release was void and
inoperative and not binding on the Society. Therefore, the mortgage award and
the auction-sale was binding on Ram Narain Ram and all those who derive title
208 from him. Their next contention is that., in any event, the transfers to
the defendants were effected during the pendency of the mortgage award
proceedings and were affected by the doctrine of lis pendens. These two grounds
were not accepted by the High Court and the courts below and it is these two
grounds which were urged before us in these appeals. The other side seeks to
avoid the effect of lis pendens by pleading that the mortgage award was claimed
mala fide against the suit plots after their release and, in any event, there
was attachment of these plots before the petition for the mortgage award was
Before we deal with these two points it may
be mentioned at once that neither ground of appeal applies to the transfers by
Sheonarain who was not a mortgagor and who was not affected by the release deed
made by the Society. Mr. C.B. Aggarwal frankly conceded that the transfer by
him could not be assailed and must stand. He, therefore, did not press Civil
Appeals Nos. 1091, 1092, 1093 and 1094 of 1964.
These appeals are accordingly dismissed with
We may first consider whether the release was
binding on the Society or not. When Ram Narain Ram mortgaged the property to
raise a loan from the Society of which he was a member, half share in the plots
belonged to him because these plots had fallen in the preliminary decree to.
the share of his brother Sheonarain Ram and himself. That preliminary decree
was passed on April 15, 193 1. The Society had fixed a ceiling on the amount
which could be borrowed, at Rs. 3000/-. The mortgage deed recited that the
amount borrowed was Rs. 3000/- with interest at Actually Rs. 1890/- were given
as a loan. The release deed, releasing the suit plots was executed in pursuance
of a resolution of the Society (Res. No. 4 dated April 4, 1933).
The release stated thus:
" ...... relinquished and released the
properties, specified below, from the debt due to the said Ram Narain Ram, to
the said society, entered in the said mortgage bond, in favour of Ram Narain
The said property shall not be made liable
for any debt of the said society nor shall any incumbrance be recovered from
the said property. The said property shall come in possession of Ram Narain
Ram. The said Ram Narain Ram shall have right to sell the property to keep the
same in whatever ways he likes. The said society neither has nor shall have any
objection thereto." 209 Why the release was granted by the Society was
stated in the following words:
" .... A petition was filed on behalf of
the said Ram Narain Ram in the meeting of the members in the presence of all
the members of the society for releasing some land from the said mortgage in
order to repay the debt. of Rs. 500/- forming part of the debt due by the said
Ram Narain Ram to the said co-operative society which was put up before all the
members and accepted by them .... ".
It appears that Ram Narain Ram did not pay
the amount of Rs. 500/- to the Society and the Society considered itself free
to include these two plots, notwithstanding the release, in their application
for an award decree. In our opinion the release was binding on the Society. The
argument. in opposition to the binding nature of the release is that it was
conditional on payment of Rs. 500/-. This is no true.
No. doubt the motive for the release was the
payment of Rs. 500/- to the Society promised by Ram Narain Ram, but the payment
was not made a condition of the release. There was no attempt to release this
amount from Ram Narain Ram.
Therefore, the release being absolute and
unconditional and by a registered deed must be treated as binding. It is open
to the promisee to waive the performance of any part of the contract or to
release any property from the operation of a 'mortgage or charge. If he wishes
his rights to continue in the. event of some condition simultaneously imposed
on the promisor, he must see that the release is made dependent on the
performance by the promisor of his part of the agreement. Here the Society
merely released the two plots without making the payment a condition precedent,
and the release operated.
That, however, is not the end of the matter.
The Society filed on April 5, 1934 a petit.ion for a mortgage award before the
Assistant Registrar, Co-operative Societies. The petition is headed 'Petition
for mortgage decree'. The petition mentioned that the mortgage was made on
April 27, 1931 and that the amount secured was Rs.
3,000/- with interest at 121/2% per annum.
The petition then described the property mortgaged and it included plots Nos.
3385 and 3384. The amount due on December 31, 1933 was said to be Rs. 2440/3.
The relief asked for was:
"We the punches therefore pray that a
decree may be passed by your honour against the said member and he may be
directed under the decree to pay the debt, principal and interest, amounting to
Rs. 2440/3/- within 3 months, that in case of non-payment this order may be
passed that the entire amount may be realized by 210 auction sale of the
mortgaged property and that if the mortgaged property would not be sufficient
for the satisfaction of the entire amount of the decree the punches of the
committee be allowed to pray for passing a personal decree against the said
member." When the Registrar made his order he overlooked that a mortgage
award had to be pass.ed. On August 16, 1934 he ordered that an award jointly
with sureties be issued.
However, on September 2, 1934, .he corrected
Iris earlier order thus:
"S1. '6. Read along with S1. 5. By
mistake of the 2nd Asst. simple award was issued instead of Mortgage award.
Issue mortgage award and ask the C.B. to return the simple award which will be
Sd. Syed Ozair. D.F.A. Addl. A.R.
2-9-34." After 'this mortgage award which had the force of a preliminary
decree, the Society on December 16, 1934 resolved that a final mortgage decree
be obtained from the Assistant Registrar, and a final decree was obtained and the
property brought to sale on February 7, 1936 and purchased by the Society
itself with the permission of the court executing the decree. Possession was
obtained on July 20, 1937. Therefore, litigation in respect of this mortgage
remained pending from April 5, 1934 to July 20, 1937. Under Explanation to s.
52 of the Transfer of Property Act the whole of this period denoted pendency of
the proceeding for purposes of application of the doctrine of lis pendens.
All the leases made by Devendranath were
after the proceedings commenced. Devendranath purchased the right title and
interest of Ram Narain Ram on August 13, 1934.
His acquisition was prima facie hit by the
doctrine of lis pendens. Three arguments were advanced before us to meet this
situation and we shall now deal with them seriatim.
The first argument is that there could be no
lis pendens till August 16, when the money award was issued because a money
suit for proceeding cannot lead to the application of the doctrine of lis
pendens. As a proposition of law the argument is sound but it is wrongly
grounded on fact. The proceeding was to get a mortgage award, the equivalent of
a mortgage decree. The Court made a mistake and treated it as a proceeding for
a money decree. When the court corrected its,order, the mortgage award related
back to the petition as made and the whole of the proceeding must be treated as
covered by the doctrine. We cannot, therefore, accede to the suggestion that
the doctrine did not apply; at any rate, on this suggested ground.
211 The second ground of attack is that
before the proceedings commenced before the Registrar these fields had been
attached and, therefore, the doctrine of lis pendens again cannot apply. We are
unable to accept this argument either. If the property was acquired pendente
lite, the acquirer is bound by the decree ultimately obtained in the
proceedings pending at the time of acquisition. This result is not avoided by
reason of the earlier attachment. Attachment of property is only effective in
preventing alienation but it is not intended to create any title to the
property. On the other hand, s. 52 places a complete embargo on the transfer of
immovable property right to which is directly and specifically in question in a
pending litigation. Therefore the attachment was ineffective against the
doctrine. Authority for this clear position is hardly necessary but if one is
desired it will be found in Moti Lal v. Karrab-ul-Din and others(1).
Lastly it was contended that the sale was by
court auction and the doctrine of lis pendens would not apply to such a sale.
This point was considered in Samarendra Nath Sinha and Anr. v. Krishna Kumar
Nag(2) by one of us (Shelat, J.) and it was observed as follows :-- " ....
The purchaser pendente lite under this doctrine is bound by the result of the
litigation on the principle that since the result must bind the party to it so
it must bind the person driving his right, title and interest from or through
him. This principle is well illustrated in Radhamadhub Holdar v. Monohar(3)
where the facts were almost similar to those in the instant case. It is true
that section 52 strictly speaking does not apply to involuntary alienations
such as court sales but it is well-established that he principle of lis pendens
applies to such alienations. (See Nilkant v. Suresh Chandra(4) and Moti Lal v.
Karrab-ul-Din(1).'' This ground also has no validity.
Lastly it was argued that if the fields were
released from the operation of the mortgage they could not be made the, subject
of a mortgage decree, and whatever was done in the mortgage proceedings was not
of any consequence. to this there are two answers. Firstly, the respondent
before the Registrar (Ram Narain Ram) made no objection to the inclusion of the
plots in the petition for a mortgage award.
Secondly, the doctrine of lis pendens applies
irrespective of the strength or weakness of the case on one side or other. See
Gouri Dutt Maharaj v. Sukur Mohammed and Ors.(5). There is, however, one
condition that (1) 24 I.A. 170. (3) 15 I.A. 97.
(2)  2 S.C.R. 18. (4) 12 I.A. 171.
(5) 75 i.A. x65.
212 the proceedings must be bona fide. Here
no doubt the Society knew that the plots had been released from the mortgage,
but it was also clear that the release was to enable Ram Narain Ram to dispose
of some of the plots and pay Rs. 500/- to the Society. This amount was never
paid and the Society must have bona fide felt that the plots still remained
encumbered. In fact the attitude of Ram Narain Ram in not claiming that these
plots be removed from the mortgage award shows that he too felt that this was
the true position. In Gouri Dutt Maharaj's(1) case referred to by us, it was
said that if the proceedings were bona fide, the applicability of s. 52 was not
For the above reasons we are clear that the
purchase by Kedarnath was protected by the doctrine of lis pendens, the prior
transfer to the defendants notwithstanding. In this view of the matter the
judgment of the High Court cannot be sustained. The appeals will, therefore, be
allowed. The judgment and decree of the High Court will be set aside and the
suits of the appellant will be decreed with costs throughout. In this Court the
costs will be one set.
R.K.P.S. Appeals allowed.
(1) 75 X.A. 165 L 1 Sup./70--6-7-70- GIPF.