Suit for pre-emption on ground of vicinage brought when only an agreement to sell existed. Court held pre-emption arises only from a completed sale; an agreement creates no interest in property, so no cause of action. Appeal allowed, suit dismissed.
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[2008] 12 S.C.R. 226
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KUMAR GONSUSAB & ORS.
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SRI MOHAMMED MIYAN URF SABAN & ORS. (Civil Appeal No. 157 of 2001)
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AUGUST 19, 2008
[TARUN CHATTERJEE AND P. SATHASIVAM, JJ.]
Mohammedan Law - ss. 226 and 232 - Suit for pre-emption on the ground of vicinage - On the basis of agreement for csaleof the suit property-Entertainability of-Held: Suit not entertainable as no cause of action arose to file the suit- Cause of action would arise only when the suit property is actually sold and not when there is merely an agreement to sell - Transfer of Property Act, 1882 - s. 54.
D Pre-emption - Right to pre-emption - Nature of - Held: Such right is a weak right - There are no equities in favour of pre-emptor - Courts can not go out of their way to help the pre-emptor - Equity.
In the insant matter, the question for consideration was whether a suit for pre-emption on the ground of vicinage could be entertained when only an agreement for sale has been entered into in respect of the suit property.
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Allowing the appeal, the Court
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F HELD: 1.1 On a plain reading of Sections 226 and 232 of the Mohammedan Law, it is clearly evident that the right of pre-emption can only accrue to an owner of immoveable property when another immoveable property is sold to another person. Section 232 of the Mohammedan G Law indicates that sale alone gives rise to pre-emption.
In view of the admitted fact that merely an agreement for sale was entered into by appellant No.3 in favour of appellant Nos.1 and 2 in respect of the suit property, the question of exercising any right of pre-emption by the re226
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KUMAR GONSUSAB & ORS. v. SRI MOHAMMED 227 MIYAN URF SABAN & ORS.
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spondents could not arise at all. A suit for pre-emption brought on the basis of such an agreement for sale must be held to be without any cause of action as there was no right of pre-emption in the respondents which could be enforced under the law. [Paras 10 and 11] [233,G-H; 234,D]
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1.2 Section 54 of Transfer of Property Act says that a contract for sale does not, of itself, create any interest in or charge on immoveable property. Therefore, where the parties enter into a mere agreement to sell, it creates no interest in the suit property in favour of the vendee and the proprietary title does not validly pass from the vendor to the vendee and until that is completed, no right to enforce pre-emption arises. Therefore, the suit for preemption brought on the basis of such an agreement was without any cause of action as there was no right of preemption in the respondents which could be enforced under the law. [Para 11] [234,B-D]
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Radhakishan Laxminarayan Toshniwal, vs. Shridhar Ramchandra Alshi and Ors. AIR 1960 SC 1368 - referred to.
1.3 If ultimately the sale deed is executed, it would be open for the respondents to apply for pre-emption of the suit property, provided that under the law they are permitted to maintain the suit for pre-emption. [Para 15) [235,E]
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228 SUPREME COURT REPORTS
[2008) 12 S.C.R.
A Radhakishan Laxminarayan Toshniwal vs. Shridhar Ramchandra Alshi and Ors. AIR 1960 SC 1368 - referred to.
Case Law Reference
AIR 1960SC1368 Referred to. Paras11and12
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CIVILAPPELLATE JURISDICTION: Civil Appeal No. 157 of 2001
From the final Judgment and Order dated 5.11.1998 of the High Court of Karnataka at Banglore in R.S.A. No. 831 of c 1996
Shankar Divate for the Appellant.
R.S. Hegde, P.P. Singh, M. Qamaruddin and lrshadAhmad for the Respondents.
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The Judgment of the Court was delivered by
TARUN CHATTER .. JEE, J. 1. This appeal is directed against the judgment and decree dated 5th of November, 1998 passed by the High Court of Karnataka at Banglore in R.S.A. E No. 831/1996, by which the second appeal filed by the respondents was allowed and judgment and decree of the courts below were set aside and the suit was decreed with costs.
KUMAR GONSUSAB & ORS. v. SRI MOHAMMED 229 MIYAN URF SABAN & ORS. [TARUN CHATTERJEE, J.]
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(Defendant No. 1/Appellant No.3) wife of Mohd Yusuf Maniyar A and against Kumar Gonsusab (Defendant No. 2/Appellant No.1) and Kumar Shafi Mohd (Defendant No. 3/Appellant No.2) restraining the appellants from executing a sale deed relating to the suit property on the ground of right of pre-emption, to purchase 6 acres 31 guntas being R.S.No.164/38 situated at B Mishrikoti village of Kalghatagi taluk, Dharwad in the State of Karnataka (hereinafter referred to as the 'suit property') and for other incidental reliefs. Be it mentioned at this stage, that the original Plaintiff No.1, namely, Mohd. Ismail Urf Badshah died during the pendency of the proceeding and his heirs and legal c representatives were brought on record. In this judgment, the plaintiffs are described as respondents and the defendants are described as appellants.
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The suit property was the ancestral property belonging to the family of the respondents, which was sub-divided among the co-sharers. Smt. Hamedabegum, Appellant No. 3 was born in the family of the respondents and she was given in marriage. E The respondents were adjoining owners of the suit property and they were entitled to pre-empt the suit property on the ground of vicinage. The Appellant No.3 had entered into a mere agreement to sell the suit property to Appellant Nos. 1 and 2 by a registered agreement for sale executed on 121 h of February, ·1987. The respondents claimed pre-emption on the ground ofF vicinage under the Mohammedan Law and family customs in respect of the suit property. Since on 19th of February, 1987, the appellants attempted to mutate their names on the basis of the aforesaid registered agreement to sell, executed on 121 h of February, 1987, the respondents, after coming to know the inG tention of the appellants to sell the suit property on the basis of the registered agreement to sell, expressed their intention to exercise right of pre-emption on the ground of vicinage. Since the Appellant No.3 had refused to sell the suit property to the respondents, they were constrained to file the suit for permaH
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KUMAR GONSUSAB & ORS. v. SRI MOHAMMED 231 MIYAN URF SABAN & ORS. [TARUN CHATTERJEE, J.]
of pre-emption on the ground of vicinage was unconstitutional A and void. The trial Court further held that the question of right of pre-emption of the respondents in respect of the suit property could not arise in view of the fact that the agreement for sale could not create any interest in the suit property in favour of Appellant Nos.1 &2 and for this purpose, reliance was placed B by the trial Court on Section 232 of the Mohammedan Law. An appeal was carried by the respondents before the first appellate court and the first appellate court after considering the judgment and decree of the trial court and also after re-appreciating the evidence on record dismissed the appeal by its judg- c ment dated 61 h of March, 1996. Against the judgment of affirmance of the courts below, a second appeal was filed by the respondents which, by the impugned judgment, allowed the second appeal, holding that in the light of the amendment to the Constitution, the law of pre-emption on the ground of vicinage D cannot be held to be unconstitutional and void. However, the High Court had failed to deal with the question which was decided by the trial court as well as the appellate court to the ef· feet whether the suit for pre-emption brought on the basis of such an agreement was without any cause of action as there E was no right to pre-emption in the respondents which could be enforced under the law in view of Section 232 of the Mahammedan Law. It was further held by the High Court, while setting aside the judgments of the courts below, that the respondents had got right of pre-emption, if the agreement for sale was going to be given effect to by the appellants and if not then cerF tainly the respondents were not affected and that if the agreement for sale was going to result in a sale deed then such sale must be held to be in violation of the above provision. With these findings, both the judgments and decrees of the courts below were set aside and the suit was decreed. It may be reiterated G that the High Court, while setting aside the judgment of the courts below, held that the law of pre·emption based on vicinage cannot be he.Id to be void and unconstitutional in view of the amendment of the Constitution.
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A 8. Keeping the aforesaid conclusions arrived at by the Hig-h Court in mind, we now proceed to deal with the questions raised before us. So far as the constitutionality of the right of pre-emption on the ground of vicinage is concerned, we find that the High Court, as noted hereinearlier, held that the right of preB emption on the ground of vicinage under the Mohammedan Law cannot be said to be unconstitutional and void in view of the amendment to the Constitution. Whereas the Courts below relying on the two decisions, namely Bhau Ram's case (supra) and Sant Ram's case (Supra), held that the right of preemption c on the ground of vicinage was unconstitutional and void. It is true that subsequent to the aforesaid two decisions, this Court again reiterated the principles as laid down in Bhau Ram's case (supra) and Sant Ram's case (Supra) in the case of Atam Prakash vs. State of Haryana & Ors. [(1986) 2 SCC 249] and also in A.Razzaque Sajansaheb Bagwan & Ors. vs. Ibrahim 0 Haji Mohammed Husain [(1998) 8 SCC 83]. We, however, do not intend to go into this question in this case as in view of our decision on the other issue, namely, whether the suit for preemption on the ground of vicinage was maintainable in law in view of the admitted fact that only an agreement for sale of the E suit property was entered into by the appellant No. 3 with the Appellant Nos. 1 & 2.
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KUMAR GONSUSAB & ORS. v. SRI MOHAMMED 233 MIYAN URF BABAN & ORS. [TARUN CHATTERJEE, J.]
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~ that right of pre-emption is a right which the owner of an immovable property possesses to acquire by purchase another immoveable property which has been sold to another person. Section 232 of the Mohammedan Law would also be relevant which runs as under:
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"232. Sale alone gives rise to pre-emption -
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The right of pre-emption arises only out of a valid (a}, complete (b}, and bonafide (c) sale. It does not arise out of gift (hiba}, sadaquah (s. 171 }, wakf, inheritance, bequest (d}, or a lease even though in perpetuity (e}, Nor does it c arise out of a mortgage even though it may be by way of conditional sale (f); but the right will accrue, if the mortgage is foreclosed (g). An exchange of properties between two persons subject to an option to either of them to cancel the exchange and take back his property at any time during D his life, stands on the same footing as a conditional sale; such an exchange does not extinguish the ownership in the property and does not give rise to the right of preemption. But if one of the parties dies without canceling the exchange, the transaction will mature into two sales E and will give rise to the right of preemption (h). It has been held by the High Court of Allahabad that a transfer of property by a husband to his wife in lieu of dower is a sale, and is therefore subject to a claim for pre-emption (i). On the other hand, the Chief Court of Oudh has held that the transaction amounts to a hiba-bil-ewaz, and no claim forF pre-emption can therefore arise OJ.
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On a plain reading of Sections 226 and 232 of the Mohammedan Law, it is clearly evident that the right of pre-emption can only accrue to an owner of immoveable property when another immoveable property is sold to another person. Section 232 of the Mohammedan Law also indicates that sale alone gives rise to pre-emption. Such being the provision made in Sections 226 and 232 and in view of the admitted fact that in this case admittedly sale was not affected by appellant No.3 in
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[2008] 12 S.C.R.
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A favour of the appellant Nos. 1 and 2 in respect of the suit property, we are not in a posifion to hold that the suit for pre-emption was maintainable as there was no cause of action to file such suit in the absence of a sale deed effected in respect of the said agreement for sale.
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KUMAR GONSUSAB & ORS. v. SRI MOHAMMED 235 MIYAN URF SABAN·& ORS. [TARUN CHATTERJEE, J.]
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virtue of the rights created in him by statute. It is well settled that it would be open to the pre-emptee, to defeat the law of preemption by any legitimate means, which is not fraud on the part of either the vendor or the vendee and a person is entitled to steer clear of the law of pre-emption by all lawful means.
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Appeal allowed.
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2 issues framed by the court
Whether a suit for pre-emption on the ground of vicinage can be entertained when only an agreement to sell, and not a completed sale, exists.
Whether the right of pre-emption based on vicinage under Mohammedan Law is constitutional.
Colour shows how this judgement treated each authority
Radhakishan Laxminarayan Toshniwal vs. Shridhar Ramchandra Alshi and Ors.Relied on¶11
[AIR 1960 SC 1368] · Who else cites this
Bhau Ram vs. B. Baijnath SinghReferred¶8
[1962 Supp.3 SCC 724] · Who else cites this
Sant Ram & Ors. vs. Labh Singh & Ors.Referred¶8
[1964 (7) SCR 756] · Who else cites this
Atam Prakash vs. State of Haryana & Ors.Referred¶8
[(1986) 2 SCC 249] · Who else cites this
A. Razzaque Sajansaheb Bagwan & Ors. vs. Ibrahim Haji Mohammed HusainReferred¶8
[(1998) 8 SCC 83] · Who else cites this
2 provisions across 2 enactments
Kumar Gonsusab
Kumar Shafi Mohd
Smt. Hamedabegum
Sri Mohammed Miyan Urf Saban
Tarun Chatterjee
P. Sathasivam
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
