1979 (1) TMI 232 - SC - Indian Laws

Summary

Issues Involved:

1. Ownership and entitlement to the suit property.
2. Validity and effect of the agreement dated 2.4.1960.
3. Payment and contribution towards the purchase price and expenses.
4. Registration and conveyance of the property.
5. Legal implications under Section 66 of the Civil Procedure Code.
6. Estoppel and enforceability of the unregistered agreement.
7. Reliefs and entitlements of the plaintiffs.

Issue-wise Detailed Analysis:

1. Ownership and Entitlement to the Suit Property:
The plaintiffs filed a suit for the declaration of their title to 3/4th share of the suit property and premises, claiming co-ownership based on an agreement dated 2.4.1960. The defendant denied the co-ownership claim, asserting that he purchased the property in a court auction as the absolute owner. The trial court decreed the suit in favor of the plaintiffs, but the High Court dismissed it, leading to this appeal.

2. Validity and Effect of the Agreement Dated 2.4.1960:
The plaintiffs relied on the agreement dated 2.4.1960, signed by all parties, which stated that the bid for the property was made jointly in co-ownership. The defendant contended that the agreement was only a security for a loan and not intended to be acted upon. The court found inconsistencies in the evidence provided by the plaintiffs regarding the agreement and its execution.

3. Payment and Contribution Towards the Purchase Price and Expenses:
The plaintiffs claimed they contributed Rs. 10,000 each towards the purchase price and Rs. 3,500 each towards expenses. The defendant admitted receiving Rs. 10,000 from each of plaintiffs 2 and 3 but claimed it was a loan. The court found that plaintiffs 2 and 3 failed to prove the additional payment of Rs. 3,500 each, and the first plaintiff failed to prove any payment towards the consideration.

4. Registration and Conveyance of the Property:
The property was ultimately conveyed and registered in the name of the defendant alone. The plaintiffs did not provide a satisfactory explanation for why they did not insist on the bid being confirmed in their joint names. The defendant also did not explain why he applied for the sale confirmation in favor of all parties and later accepted the conveyance in his name alone.

5. Legal Implications Under Section 66 of the Civil Procedure Code:
The defendant raised a legal argument that the suit was barred under Section 66 of the Civil Procedure Code, which prohibits suits claiming title under a purchase certified by the court on the ground that the purchase was made on behalf of the plaintiff. The court found that Section 66 did not apply as the sale was conducted by a Receiver under the High Court Rules, not under the Civil Procedure Code.

6. Estoppel and Enforceability of the Unregistered Agreement:
The defendant argued that the plaintiffs could not rely on the unregistered agreement to claim title. The court noted that the plaintiffs' claim was based on co-ownership and not solely on the unregistered agreement. The court permitted the legal question to be raised but found that it did not affect the maintainability of the suit.

7. Reliefs and Entitlements of the Plaintiffs:
The court concluded that the plaintiffs 2 and 3 were entitled to 1/4th share each in the property upon payment of Rs. 3,500 each towards expenses. The plaintiffs were also entitled to their share of the rents collected by the defendant, estimated at Rs. 25,000 each. The first plaintiff was not entitled to any relief, and the suit was dismissed concerning him. The appeal was allowed to the extent of partition and separate possession of 1/4th share each for plaintiffs 2 and 3, with directions for a decree in terms of the compromise reached by the parties.

Conclusion:
The appeal was allowed to the extent that plaintiffs 2 and 3 were granted 1/4th share each in the property upon payment of their share of expenses, and they were entitled to their share of rents collected. The first plaintiff's claim was dismissed. The parties were allowed to enter into a compromise and report it to the court for the final decree.