This appeal by special leave is directed against the judgment and decree dated 1-9-1978, rendered by a Division Bench of the High Court of Karnataka in Regular First Appeal No.91 of 1973, affirming that of the Trial Court.
Shri Batchu Muniyappa Chetty, statedly the foster father of Smt. Vijaya Lakshmi, the appellant herein, and Shri B. Himantharaja Chetty, the contesting respondent herein, were brothers, being the sons of Shri Batchu Ramaiah Chetty. The father and sons effected a partition of their joint family properties, under registered Partition Deed dated June 23, 1928 (Ex.P.3), as detailed in Schedule A attached thereto. Thereunder the father was given properties described fully in Schedule B to the indenture valued at Rs. 20,000/-. The foster father of the appellant got properties described fully in Schedule B to the indenture and valued at Rs.12,500/-. The contesting respondent got the properties described fully in Schedule C to the indenture also valued at Rs.12,500/-. Clause 12 thereof provided a stipulation of preemption, which being the bone of contention. reads as follows:
"The second (the foster father of
the appellant) and third (the
contesting respondent herein) are
allotted the immovable properties
Nos.137, 138 and 139, Jeweller’s
Street and No.25, Veera Pillay
Street as described in the
Schedules hereunder. Though the
party to whom it is allotted is
entitled to dispose it of, he shall
not do it to any stranger without
giving the parties to this
indenture an opportunity to buy it
by pre-emption at the valuation
given in the schedule to this
indenture."
The foster father of the appellant died somewhere in the year 1948 leaving his property by means of a Will dated 1-12-1948 to his widow Smt. Lakshmidevamma, who also died in the year 1956 However, before her death, in 1951, she, as foster mother of the appellant executed a Will in favour of the latter bequeathing to her properties mentioned in Schedule C. The appellant claims to have received these properties as a foster child of late Batchu Muniyappa Chetty and his late widow Smt. Lakshmidevamma, but not as a stranger.
The respondent on 11-12-1956 instituted a suit against the appellant for possession of the aforementioned Schedule C properties the Civil Court at Bangalore inter alia on the premise that under the terms of the Partition Deed, abovereferred to, the dispositions of properties made in the manner stated above by late Batchu Muniyappa Chetty and after him by his widow Smt. Lakshmidevamma, were in breach of the terms of the Partition Deed and therefore his right to enforce his claim for pre-emption, on payment of Rs.3100/-, the price fixed therein, had ripened. The appellant put forth the two wills to assert her title as legatee. She also claimed on a variety of grounds that neither the plaintiff-respondent had any right of preagainst her nor was such claim tenable in law.
Having regard to the multiplicity of pleas raised by both sides, the trial court framed as many as 11 issues but the relevant ones for the present purpose are the following two issues:
No.3. Whether the plaintiff proves
his right of pre-emption in respect
of disposition of properties by
bequest as well?
No.4. Whether defendants prove that
the alleged pre-emption is
unenforceable against her for
reasons stated in para 4 of the
written statement?
After recording evidence of the parties and entertaining documentary evidence the trial court recorded its findings on those two issues to the effect that the plaintiff-respondent had all right of preemption in respect of the suit properties even though they came to the appellant by bequest and that such right of pre-emption was an enforceable right. On holding so and as a result of findings on other issues, the plaintiff-respondent’s suit was decreed, directing the appellant to execute a Deed of Sale, at the cost of the plaintiff-respondent, on payment of Rs.3100/-, and consequently deliver possession of the properties to the plaintiff-respondent.
The appellant preferred Regular First Appeal before the High Court of Karnataka which was placed before a Division Bench comprising of K. Bhimiah and K.S. Puttaswamy, JJ. for disposal. The Hon’ble Judges of the High Court differed and rendered separate judgments. K. Bimiah, J. opined for the dismissal of the appeal affirming the judgment and decree of the trial court on all issues except to very the price payable to be Rs.36000/- as determined by the trial court for purposes of jurisdiction and court fee. He thus ordered maintenance of the trial court’s judgment and decree on payment of Rs.36000/- as price. K.S. Puttaswamy, J. however in his opinion took the view that findings on Issues Nos.3 and 4 be reversed and hence the appeal allowed. This divergence of opinion attracted Sub-section (2) of Section 98 of the C.P.C. and therefore the judgment and decree of the Trial Court got confirmed. The price rise too got affirmed on agreement. In sum the plaintiff-respondent got maintained the decree on payment of Rs.36000/- as price of the property. Being aggrieved the appellant is before us.
We do not propose to enlarge the canvass to enter into elaborate discussion and analysis as undertaken by members of the High Court Bench in their respective opinions on Issues Nos.3 and 4 relating to the concept of pre-emption, its historical perspective, related precedents and its validity as of today and other ramifications. All the same a classic judgment of Mohmood, J. in Govinda Dayal vs. Inayatulla [ILR 7 A1] 775 at page 909 (F8)] is worth reference, which explained the right of pre-emption in the following words:
"It (right of pre-emption) is
simply a right of substitution
entitling the preemptor by means of
a legal incident to which the sale
itself was subject, to stand in the
shoes of the vendee, in respect of
the rights and obligations arising
from the sale under which he has
derived his title. It is in effect,
as if in a sale deed, the vendee’s
name was rubbed out and the pre-
emptors’s name was substituted in
his place.
The concept of substitution from that long and even before has been the foundation of the law of pre-emption and has been noticed, followed and employed, time and again, in a catena of decisions. The fact that this Court in Atam Prakesh vs. State of Haryana [1986(2) SCC 249] has struck down the right of pre-emption based on consanguinity as a relic of the feudal past, inconsistent with the constitutional scheme and modern ideas, has not altered the situation that the right of pre-emption, wherever founded, whether in custom, statute or contract, is still a right of being substituted in place of the vendee, in a bargain of sale of immovable property. We therefore need not burden this judgment with other attributes of the concept as attempted by both Hon’ble Judges of the High Court. We would rather go to decide this appeal on the basis of the contractual term aforementioned.
It is noteworthy that Clause 12 of the Partition Deed not only mentions the list of the properties allotted to the two brothers but their separateness is complete and evidenced, the way these properties are apportioned and earmarked in Schedules C and D. by allocating specific properties to the two brothers, each of them had become exclusive owner of those allotted. Clause 10 of the Deed and the Schedules A, C & D are reproduced hereafter:
10. The parties two and three have
been allotted portions in premises
137 and 138 Jeweller Street as per
their respective schedules and the
plan annexed to this indenture. The
portions allotted to party No.2 are
marked yellow and the party No.3
red. The cost of construction of
wall or walls for partitioning the
said portions, shall be borne by
the parties two and three in equal
shares."
Schedule A, containing the list of involved partible joint family properties: DISCRlPTI0N VALUE (4) No.25, Veera Pillay Street - Rs. 400
Schedule C showing properties which came to the foster father of the appellant: DESCRIPTION VALUE (1) Total premises No.25, Veera Pillay Street, Bangalore; - Rs.400 (2) Portion earmarked and shown as yellow in Property No.137; - Rs.1400 (3) Portion earmarked and shown in yellow in Property No.138; - Rs.1300
Schedule D showing the properties which came to the contesting respondent: DESCRIPTION VALUE (1) Total property No.139; - Rs.1400 (2) Portion in Property No.137, as shown in red; - Rs. 100 (3) Portion in Property No.138 as shown in red; - Rs.1500
Walls were intended to be raised to demarcate and separate the portions relating to two properties as the other two were individually allotted to the respective parties. This fall out of the partition has unfortunately not been taken into account either by the Trial Court or the Bench of the High Court. The following finding recorded by the Trial Court therefore does not match happily with the pattern of partition:
"The entire building consisting of
the portion allotted to the share
of the plaintiff and to the share
of his brother Batchu Muniyappa
Chetty forms one house. If a
stranger is inducted in any portion
of the house, the members residing
in the other portion will feel it
inconvenient to lead a peaceful
life. Every house requires privacy
from strangers. Apart from this
there are common passage and
entrances. In fact, storm water
from the roof of one of the parties
falls into the portion of the other
party. A window belonging to the
plaintiff opens into the space
belonging to the other party. There
are connected doors; the hall in
the first floor is allotted to the
share of the plaintiff and the hall
just below it is in-the possession
of defendants. There is a stair
case also leading to the first
floor and the space directly below
it has gone to the share of the
plaintiff’s brother. All these
matters are such that it is not
possible to lead a convenient and
peaceful life if a stranger is
inducted to the property. It
appears in view of these
circumstances clause of pre-emption
was inserted in the partition deed
to safeguard the peace, convenience
and amity of the family and the
insertion of such a clause in the
partition deed is not in violation
of the provisions of the transfer
of Property Act.
In view of what has been
discussed above it must be held
that the plaintiff has got a right
of pre-emption in respect of the
suit Property even though it is
bequeathed by the late Batchu
Muniyappa Chetty on his window and
his window in turn bequeathed on
the first defendant. It also be
held that the right of preemption
is an enforceable right. I,
therefore, answer issues 3 and 4 in
favour of the plaintiff and against
the defendants."
And seemingly it has met the approval of the High Court.
Now who is the stranger’ meant to be excluded in the Partition Deed? The Trial Court has viewed the plaintiffappellant to be a stranger, being not a relative and at least to the family of the plaintiff-respondent. Bhimiah, J. affirms this view. Puttaswamy, J. held that the appellant is a stranger in the eye of law to the family of her foster father, but not in fact. The word ‘stranger’, in our view, had to be understood not in terms of blood or marriage relationship with the family but as a person unconnected with it, unknown in character and antecedents to the executants of the Deed. The word ‘stranger’ in the text has, in our view, to be interpreted as that person who has no connection whatsoever with the families of the original executants i.e. the father and two sons. It has to be seen that the plaintiff-respondent was not an utter stranger to the family members though she may not have been related to them through blood or marriage or otherwise by legal adoption. In any case, she had become connected with the family which relationship required to be respected with some sanctity, legitimately due to human bonds, because of her long association with her foster parents. Her status as such could by no means be termed as a ’stranger’ for the purpose of Clause 12 of the Partition Deed. Thus if the bequest in her favour was not made to a total stranger, one need not enter the thicket to find whether the appellant was legally a stranger to the family, when factually she was not, and in that manner not unconnected with the family.
Next we come to the question whether the disposition conceived of in the Partition Deed should be a sale attracting pre-emption or could it also be a disposition other than sale. The word ‘pre-emption’ as is well understood is a term of law. lt is a right of substitution conferred on someone either by statute, custom or contract. The right is to step into the shoes of the vendee preferentially, on the terms of sale already settled between the vendor and the vendee. The courts below were put across the irrefutable argument that the tenor of the Deed suggested that it was written by a professional, knowing fully well the attributes of pre-emption. The Deed itself says that the parties have to be given an opportunity to buy the property meant for disposal. The Deed provides so on the supposition that the disposition contemplated would be a sale and none other. Had it been otherwise, the words "by pre-emption" could easily have been omitted conveying the meaning suggested and the deed made to read ".... he shall not do it to any stranger without giving the parties to this indenture an of opportunity to buy it by pre-emption at the value given in the Schedule to this indenture". It is thus evident that the words "by pre-emption" were consciously employed to denote that the opportunity to buy it by preemption would only arise when there is a same and on no other disposition. It could then be said that but for these words "by pre-emption", any other disposition could have come within the grip of the Clause towards buying property, but without bringing in the word "preemption".
Thus for the afore-expressed views we have come to the firm conclusion that on the terms of the Partition Deed, the contractual right of pre-emption conferred on the parties to buy property before it is disposed of to a stranger was based on the precondition that the proposed or actual disposal would be only-by way of sale and no other, and that too if made to a stranger. None of these conditions are satisfied in the facts and circumstances of the case as neither is the disposition a sale nor is the transferee a stranger. Therefore, the suit of the plaintiff-respondent should have been and is hereby dismissed by allowing this appeal, upsetting the judgments and decrees of the trial court as well as that of the High Court, but without any order as to costs.