Motimul Sowcar vs Visalakshi Ammal and Others

(1) S. A. NO. 1389 of 1960 related to a suit filed in the City Civil Court by a certain Visalakshi Ammal (plaintiff) for a declaration that she was the

absolute owner of the superstructure in premises comprising door No. 21 Broadies Road, Mylapore. The suit was decreed by the learned

Assistant Judge, who gave a finding that the plaintiff was the owner of the mortgaged property in controversy, and also a consequential declaration

that the mortgage executed by Maduraimuthu Naicker, husband of the plaintiff, would not bind the plaintiff with regard to her interest in the

property, i.e., the proprietary interest in the superstructure. The first defendant-mortgagee preferred a first appeal to the Principal Judge of the City

Civil Court. That court confirmed the findings of the trial court, and dismissed the appeal.

(2) The first defendant-mortgagee thereupon instituted S. A. No. 1339 of 1960, which came up for hearing and disposal before Venkatadri J. The

learned Judge went into the evidence, upon which the concurrent findings of fact of the courts below were based. He then furnished his dissenting

conclusion on the main issue of fact in the following form:

There is sufficient material to come to the conclusion that the suit property might have belonged to both the husband and the wife. It might have

been that Visalakshi Ammal might have construed the superstructure partly from out of her funds. There is no evidence to show that he entire

superstructure was built by Visalakshi Ammal. In the circumstances, I declare that he property belongs both to Maduraimuthu Naicker and

Visalakshi Ammal.

(3) There was a further contention raised on behalf of the appellant (mortgagee) before the learned Judge that, in any event, the appellant was

entitled to the benefit of the equity enacted as S. 41 of the Transfer of Property Act. The learned Judge (Venkatadri J.) cited a passage from

Sethumadhava Ayyar Vs. Bacha Bibi and Others, and came to the conclusion that the mortgagee was entitled to this benefit, in any view.

Ultimately, he reversed the findings of the courts below, and held that both the plaintiff (Visalakshi Ammal) and her husband were the owners, but

that the mortgagee would be entitled to work out of his remedies only against the right, title and interest of the husband, Marudamuthu Naicker.

Both parties have preferred the appeals, under the Letters Patent, which are now before us.

(4) We might immediately set forth, quite tersely, the questions that now arise for our determination. Firstly, there is the question whether, in

second appeal, this court could interfere with a concurrent finding of fact by two courts below, where no question of law is involved, and where it

is not established that there is some failure to consider essential evidence, or some infirmity or defect in the procedure, which would amount to a

question of law. Secondly, there is the problem whether, in the merits of the evidence the learned Judge (Venkatadri J.) had justification, even

assuming that there could be interference in second appeal, for differing form the courts below, and arriving at the conclusion of fact which he has

actually reached. Thirdly, there is the question, whether the equity embodied in S. 41 of the Transfer of Property Act cold at all be invoked by the

appellant before the learned Judge, the mortgagee, in the light of the established facts.

(5) We shall take up the second of these questions first, because it seems to us that there were very powerful reasons for the courts below to hold,

on the merits, that the superstructure was the exclusive property of the plaintiff (Visalakshi Ammal), and that she had fully succeeded in establishing

that claim. Indisputably, the site itself is leasehold, and the ownership vested in a devastanam (Sri Kapaleeswarar temple). There was a prior lease

in favour of a third party, and, in September 1936, Maduraimuthu Naicker, the husband of the plaintiff, took the site on lease. There is no

controversy concerning the leasehold interest in the site possessed by Maduraimuthu Naicker. But the case of the plaintiff (Visalakshi Ammal) was

that it was she who erected the superstructure, form out of her own funds, that her husband had no concern with this construction, that his moneys

did not contribute to it in any manner, and that he was not an owner of the superstructure to any degree or extent. The trial court discussed the

evidence at considerable length and laid stress on those aspects of evidence which went far, in its view, to prove the claim of the plaintiff. We do

not think it is necessary to reiterate these aspects in detail. It is sufficient for us to emphasise a few facts. There was voluminous documentary

evidence adduced by the plaintiff, according to the court of trial, in support of her case. The plaintiff dealt with the superstructure by way of

mortgages in 1945 and 1946, and that certainly shows that she exercised acts of dominion over this property; on the evidence, it was clear that she

had stridhanam funds, and there was a great deal of evidence to show that the construction was probably form her assets. The plaintiff entered into

an agreement with the Corporation of Madras for a part of the construction, comprising a flush-out latrine. The Municipal authorities had

recognised her as the owner of the premises. On this aspect, it is sufficient for us to state that both the trial court and the first appellate court have

rightly laid emphasis on the municipal registry in favour of the plaintiff, viz., Exs. A. 5 and A. 6, for the periods 1945-46 and 1952-53. There were

also municipal tax receipts produced by the plaintiff.

(6) In the fact of this evidence--and we are now limiting the discussion to the question of the superstructure--the defendant relied purely upon the

fact that Maduraimuthu Naicker also might have possessed funds, at least according to a view adumbrated by the first appellate court, and the fact

that Maduraimuthu Naicker applied for the building permit (Dx. D. 1 dated 15-8-1938), which document further indicated that permission was

granted in his name. In addition to this, there were only certain receipts for municipal tax paid, produced by Maduraimuthu Naicker, which did not

bear the name of the person paying the taxes. The courts below referred to this aspect. They point out that, at a certain stage, quarrels arose

between the husband and wife, and that Maduraimuthu Naicker might have obtained possession of those receipts which were originally in the

possession of plaintiff. The mere fact that, at one stage, the husband applied for permission to erect a construction, was no safe guide for an

inference that the construction belonged to the husband, or, that his moneys contributed to it. On the contrary, the courts heavily stressed the other

probabilities and circumstances supporting the claim of the plaintiff (Visalakshi Ammal) that she alone had erected the superstructure. Ultimately,

the trial court and the first appellate court concurred in the finding that the superstructure was exclusively the property of the wife, erected form her

funds. We may add that there were two mortgages of the property, and that the second mortgage was taken by the defendant (mortgagee) after

Visalakshi Ammal had actually issued a notice, advancing her claim to the superstructure.

(7) It is in the light of these facts that we have to regard the conclusion of the learned Judge (Venkatadri J.) that the husband also probably

contributed to the superstructure, and that the superstructure must be held to be the property of both. We have already indicated the very heavy

evidence in favour of the claim of the wife, relied on by both the courts below. Under those circumstances, we are unable with great respect to

agree with the learned Judge (Venkatadri J.) in his view that there was sufficient material to come to a conclusion that the suit property might have

belonged to both the husband and the wife"". On the contrary, the evidence, as it stands, seems to support only one inference or conclusion that the

suit property, viz., the superstructure, was built by Visalakshi Ammal from her resources, and that it exclusively belonged to her. An opposite

inference cannot be rested merely upon the fact that the husband applied for the building permit, or that he is able to produce one or two receipts

which do not contain the name of the person making the contribution. Learned counsel for the mortgagee has not been able to show an iota of

evidence which would take away from the force of the Municipal registry in favour of the wife, which covers a substantial part of the period since

the erection of the superstructure.

(8) Even otherwise, it is very doubtful if this court could, in second appeal, reverse such a concurrent finding of fact, except for the clearest and

strongest of reasons, which could be held to be tantamount to interference on a question of law. It is sufficient to refer to the following authorities of

the Supreme Court in support of this proposition. In Pattabhiramaswami v. Hanumayya, AIR 1959 SC 57 their Lordships observed, citing with

approval an observation of the Judicial Committee in 1891, that, upon an exclusive question of fact, even though erroneous, the High Court would

have no jurisdiction even to entertain a second appeal. They referred to a long catena of decisions affirming the same principle, and emphasised

that, if he question to be decided was one of fact, the High Courts could not convert themselves in the courts of first appeal, and assume or

exercise a jurisdiction which they did not possess. There are two other decisions of Supreme Court which have to be referred to in this context.

Viz., R. Ramachandran Ayyar Vs. Ramalingam Chettiar, and Madamanchi Ramappa and Another Vs. Muthalur Bojjappa, . The second of these

decisions emphasises that, though the admissibility of certain evidence may be a point of law, once it was shown that admissible and relevant

evidence had been acted upon by the courts below, it was not open to an aggrieved party in second appeal to contend that the evidence was not

sufficient to justify the finding of fact. The decision in R. Ramachandran Ayyar Vs. Ramalingam Chettiar, also stresses that, unless there is a total

absence of evidence or some other infirmity which will show that there has been a substantial defect or error in the finding, the High Court would

not be justified in interfering in second appeal. Hence, we have no hesitation in coming to the conclusion that this was not a case in which this court

would even have jurisdiction to reverse the main finding of fact, concurrently arrived at by the court of trial and by the court of first appeal. Not can

we be satisfied, on the actual material adduced that the reversal of that concurrent finding was justified. We fell constrained, therefore, to differ

form the learned Judge, and to hold that it has been unambiguously that the leasehold interest alone inhered in the husband. Maduraimuthu Naicker,

and that the wife (Visalakshi Ammal) was the exclusive owner of the superstructure.

(9) One other question that arises for determination is whether, under the circumstances of the two mortgages in favour of the defendant, or at least

the first of them, which was entered into before the wife issued her notice of protest, the transferee could invoke the benefit of the equity embodied

in S. 41 of Transfer of Property Act. The learned Judge (Venkatadri J.) held that he could do so because, as the learned Judge points out, the

mortgagee appears to have made some kind of bona fide enquiry, within the scope of the observations in Sethumadhava Ayyar Vs. Bacha Bibi

and Others, .

(10) We are afraid that this overlooks one vital aspect of the equity embodied in S. 41 of the Transfer of Property Act. That section has been cited

and expounded in numerous decisions, and it is unnecessary, for our present purpose, to refer to the case-law at any length. But, as will be clear

form one, of the leading decisions enunciating the principle of the equity, viz., the Bench decision in S.K. Sahul Hamid and Another Vs. S.M.

Sulthan and Others, there are really two conditions to be fulfilled before the benefit could be invoked. The transferee must first prove that the

transferor was the ostensible owner of the property and that such ostensible owner was holding the property, with the consent, express or implied,

of the real owner. The second condition or term is that the transferee paid the consideration and acted in good faith, after an enquiry conducted

with due diligence, or reasonable care. It is not enough that a transferee, however bona fide, takes the property in good faith, if the real owner is

not standing by, acquiescing, expressly or by implication, in an ostensible owner holding out the title. In the present case as far as the superstructure

is concerned, there is no ostensible ownership leasehold interest, no doubt, belonged to the husband; but we are not aware of any principle of law

that a lessee must be presumed to have built the superstructure upon a land comprised in the lease, and that no one else should be thought to have

done so. There was document of title which Maduraimuthu Naicker could put forward, or did put forward, as for the single document giving him

permission to build. Obviously, that is not a document of title to the superstructure; at best, it is only evidence of an intention on the part of the

husband (Maduraimuthu Naicker) to built on the demised land. In the absence of any ostensible ownership, inhering in the husband, the question of

the equity hardly arises. Again, it cannot even he said that the transferee (mortgagee) had made due enquiry or exhibited the required diligence.

Any alienee, under such circumstances, would have first ascertained the facts of the Municipal registry regarding the superstructure, before making

a loan on the security of both the leasehold land and the superstructure thereon. The registry was indisputably in favour of the wife.

(11) Learned counsel has drawn our attention to a decision of a single judge of this court, viz., T. Syed Fakruddin Saib and Others Vs. Katta

Ramayya Setti and Others, . That was a judgement of Somayya J. In which the learned Judge held that the transferee would be protected under S.

41, even if the real owner had, prior to the transfer, unsuccessfully attempted to assert his exclusive rights to the property, in certain criminal

proceedings. But, when we look at the facts of that case, we see that is clearly distinguishable, and, indeed, that is has little relevance to the present

context. That was a case in which a certain Bhandigi Sahib was the ostensible owner, by virtue of an actual document of sale in his favour from the

previous owner. Not merely this; but the ostensible owner also executed a mortgage in favour of a third party, and exercised a mortgage dominion.

Under those circumstances, the alter transferee, a certain Katta Ramayya Setti, had every reason to honestly believe that the ostensible owner was

the real owner. The learned Judge then referred to certain prior criminal proceedings, when the real owner had attempted to controvert the claims

of the ostensible owner; and held that those proceedings did not disentitle the transferee to the benefits of S. 41. The statute itself is very clear,

regarding the requirements to be satisfied before the equity could be invoked by a transferee. We are unable to see that this decision, T. Syed

Fakruddin Saib and Others Vs. Katta Ramayya Setti and Others, lays down any different principle, and, actually, we are not at all clear that this

decision would be authority for the view that, under all conceivable circumstances, where the real owner had previously controverted the claim of

the ostensible owner, the real owner would, nevertheless, be later disentitled to advance his rights, if the ostensible owner subsequently acts upon

his ostensible title. We do not think it is necessary to discuss that aspect further.

(12) In the result, therefore, we are constrained to allow the appeal by the plaintiff in the trial court, to hold that she is the exclusive owner of the

superstructure, and that her rights will be unaffected by the rights of the mortgagee. The mortgagee (the other appellant) will therefore have rights in

respect of his mortgage only over the lease hold interest possessed by the mortgagor in the land itself. The appeal by the mortgagee is therefore

dismissed, and the appeal by the plaintiff allowed. But, we direct the parties to bear their own costs throughout, in view of the facts of the history of

this litigation.

(13) Appeal allowed.