TMI Blog1949 (8) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... of the former and so the former was estopped' from asserting his right of pre-emption. 2. Both the lower Courts have found against the Defendant 1, on point No. 1 holding that the transaction between the Plaintiff and Defendant 2, dated 6th September 1941, was one of sale and not of mortgage and so the Plaintiff was a co-occupant. On point No. 2 the trial Court held that the Plaintiff had made no such representation to the Defendant 1, and decreed the suit for pre-emption. The Court of first appeal, however, held that the Plaintiff had made suoh a representation and so he was estopped from asserting his right of pre-emption and dismissed the Plaintiff's suit. The Plaintiff has, therefore, come up to this Court. 3. The learned Counsel for the Appellant has shown no ground on which the finding of fact that the Plaintiff had made the representation that he did not want to pre-empt could be interfered with. It is, therefore, final The learned Counsel has, however, raised an important point of law. His contention is that it is clear from the provision of Sub-section (3) of Section 174 of the Berar Land Revenue Code that there can be no estoppel in such a case. 4. The re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out from what the Select Committee said on this proviso: We have added a provision providing for a case where several occupants in a survey-number have consented, but subsequently one or other of the occupants in the Survey-number refuses to consent. We consider that in these cases the consent already given should not bar the occupants giving it from enforcing their rights of pre-emption. These rights should only be barred if all the occupants in the survey-number consent. * * * * Law, therefore, recognizes no waiver except by a written consent of all or under Section 180. * * * * In Berar Section 174(3) lays down the only rule of estoppel. 6. I am inclined to think that Sub-section (3) of Section 171, Berar Land Revenue Code was enacted to avoid false pleas of oral consent and consequent delays in litigation. There would be some cases where co-ocoupants might give oral consent and then deny it and bring a suit for pre-emption if it is held that oral consent does not work as estoppel but this much is certain that the mischief would not be greater than the mischief sought to be prevented by Sub-section (3) of Section 174, Berar Land Revenue Cod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terest in the sale, and the inevitable deduction is that he permitted the sale with full knowledge of what he was doing. It also follows that but for the activities of the Plaintiff in recovering the dues which were owing to the Society the vendor would not have sold and the vendee would not have purchased the property. Consequently an estoppel arise, and the decision of the lower appellate Court is correot. Vikrama v. Bhawarmal S.A. No. 162 of 1944, D/. 3-12-1947, was followed by Pollock J. in Anandrao v. Kisan S.A. No. 584 of 1944, D/- 5-4-1948. Therein Pollock J. observed: Section 174(3) does not state that there can be no estoppel without a written consent, and Grille C.J. in Vikrama v. Bhawarlal S.A. No. 162 of 1944, D/-3-12-1947 held that there is a waiver of a right to pre-empt if the would-be pre-emptor has taken an active interest in the sale with the inevitable deduction that he permitted the sale with full knowledge of what he was doing. Dewan Bahadur Brahma in his commentary on the Barar Land Revenue Code at page 263 of the second edition has expressed the view that when the pre-emptor leads the vendee to believe that he is agreeable to the purchase the pre-em ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the questions raised. Accordingly the appeal comes up before us under the orders of the Honourable the Chief Justice. 11. The appeal is by the Plaintiff Govindsa, hereinafter referred to as the pre-emptor. He instituted this suit to pre-empt survey No. 7/1 of village Virpur, taluq Ellichpur. Sk. Ismail (hereinafter referred to as the purchaser) bought Survey No. 7/1 from Chandu, Defendant 2, hereinafter referred to as the vendor. The sale was effected under a gale-deed registered on 17th April 1942. The purohaser took possession of the field the same day. The purchaser resisted the suit on two grounds: Firstly, the pre-emptor was not an occupant of Survey No. 7 as the trans-action between him and the vendor by which the pre-emptor alleged to have bought Survey No. 7/2 was really a mortgage and made the pre-emptor a mortgagee and not an occupant. Secondly, the pre-emptor was estopped from enforcing his right of pre-emption because he assured the purchaser that he had no right to pre-empt and that he would not pre-empt. 12. In the trial Court both the defences were negatived and the suit was decreed. The Judge held that the transaction of 6th September 1941 was a sale and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts. The learned Counsel for the Appellant referred to the diecrepanoies in the evidence on behalf of the purchaser about the occasion which gave rise to the representation by the pre-omptor. The learned Counsel challenged the correctness of the findings of the learned appellate Judge that the pre-emptor had assured the purchaser that the former would not pre-empt and he had thus consented to the sale. These are however findings of fact based on evidence. Consequently they are not open to challenge in second appeal. It is however necessary to point out that the vendor did not give to the pre-emptor any notice under Section 176(1). The representation or assurance relied upon by the purchaser was given before there was even a completed agreement of sale between the vendor and the purchaser. As stated by the vendor, the bargain was settled with the purchaser after the latter was assured by the pre-emptor. It is in the light of these facts that the arguments about consent and estoppel fall for consideration. 16. At one stage in the case, the purchaser also alleged that the pre-emptor had represented to him that he had no right of pre-emption. In the arguments before us the learned C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w of pre-emption in Berar it is to be remembered that Sub-section (1) of Section 174 emphasises that the rights conferred by the Chapter are to be enforceable only in the manner and to the extent provided in that Chapter. So the Code is exhaustive with respect to matters about which it makes provision. 20. Section 173 defines an occupant in a survey number for the purposes of the Chapter. The Code confers the right of pre-emption on an occupant in a survey number in respect of the following transfers by any other occupant in the same survey number: (1) sale, (2) usufructuary mortgage, (3) lease for a period exceeding 15 years or containing a covenant for renewal where by the total period of successive leases would exceed 15 years; and (4) exchange of the whole or a part of the survey number when it does not result in the consolidation of land of either of the parties. This is a special case in a self-contained section (Section 184). 21. Lastly the right of pre-emption is also given whenever a mortgagee by conditional sale obtains a final decree for foreclosure against the interest or any portion thereof of an occupant in a survey nuaibur. 22. The right of pre-emption can b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of pre-emption in the case of a survey-number belonging to more than one occupant there is no principle on which it can be justified as sufficient where the survey number belongs to a single occupant. It is worthy of notice that under the Mahomedan law of pre-emption surrender of the right of pre-emption before the sale is not valid; see Baillie's Digest of Mahomedan law (1865) Book VII page 500, Gobind Dayal v. Inaya-tullah 7 ALL. 775 at pp. 804, 805: (1885) A.W.N. 182 F.B. and Sanwal Das v. Gur Prashad 90 P.R. 1909 p. 410 : 4 I.C. 179. It is the statute which provides that consent inhibits the accrual of the right of pre-emption. The statute, however, requires the consent to be in a particular form. There is no warrant for relaxing that requirement. To hold that oral consent prior to transfer is equally efficacious is to render the statutory provision nugatory. 27. There is nothing unjust or harsh in the view that oral consent of the pre-empter before the sale is insufficient to defeat the right of pre-emption. It is true that the intending purchaser of property would not like to embark on a dubious venture. Before he completes the transaction of purchase of property subje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in writing is to avoid uncertainty involved in the determination of doubtful pleas of oral consent based on conflicting and possibly perjured testimony. The Code proceeds on a definite scheme. The Legislature took pains to evolve a system which, if adhered to, will eliminate delays, doubts and difficulties. To hold oral consent given before a sale, a sufficient defence to a claim of pre-emption would be to encourage the disregard of the system introduced by the Code without securing any corresponding gain. 29. This brings us to Section 183. The section reads: 183(1) When an occupant in a survey number transfers his interest or any portion thereof by any of the transfers contemplated in Section 176' (and Section 178,or suffers a final decree for foreclosure as contemplated in Section 177 to be passed against him,) and no notice has been given as required by these sections, the other occupants in the survey number shall have a right to pre-emption the interest transferred. (2) Such right may be enforced by civil suit, and in all such cases the Court shall have power to examine the transaction and fix a fair consideration for the interest to be pre-empted. 30. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Nathu v. Thakubai 1 N.L.J. 253 : A.I.R. 1917 Nag. 163, Waman v. Rakhmabai S.A. No. 510 of 1943, D/- 15-10-1943, Radhakisan v. Sitaram S.A. No. 380 of 1942, D/. 3-12-1945, Vikrama v. Bhawarmal S.A. No. 162 of 1944, D/- 3-12-1947, Anandrao v. Kisan S.A. No. 584 of 1944, D/-5-4-1948 and Jainarayan v. Sadasheo S.A. No. 723 of 1944, D/. 18-11-1944, are not authorities for the proposition that prior oral consent by itself defeats the right of pre-emption. The decisions or dicta in these cases were grounded on representation or conduct of the pre-emptor giving rise to estoppel or waiver or both. Before I consider these rulings in relation to the question of estoppel. I propose to examine at some Mength the law on the aspect of estoppel as it arises in the present case. 33. As is well-known Section 115, Evidence Act, is a concise statement of the law of estoppel found, ed on the rule laid down in Pickard v. Sears (1837) 6 A. and E. 469 : 45 R.R. 538. The section runs: When one person has, by his declaration, act or omission, intentionally caused or permitted another person to believe a thing to be true and to act upon such belief, neither he nor his representative shall be allow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tor who as here assures the purchaser that he will not pre-empt but nevertheless subsequently seeks to exercise his right of pre-emption is not denying the truth of what he stated earlier but has merely changed his intention. If there has been no change of intention, but the representation as to intention was in fact false and was made fraudulently to induce the purchaser to act to his prejudice an action for deceit in tort may well lie as in the case before the Court of Appeal in Edgington v. Fitz Maurice (1885) 29 Ch. D. 459 : 55 L.J.C.H. 650. But a representation of intention. true or false, cannot give rise to estoppel, The reason is this. The pre-emptor's statement, I will not pre-empt is but a representation of present intention which is revocable. In the absence of a complete agreement of sale or even a notice on a proposed sale under Section 176(1), the occasion for the exercise or waiver of the right to pre-empt does not arise. If the purchaser chooses to act on the faith of such a representation without taking eare to reduce it to the form of a binding contract he is taking a chance of the pre-emptor changing his mind. It is immaterial whether the representation is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d not of fact failed to raise an estoppel against Mrs. Jorden. As the Lord Chancellor pointed out, in the case of what is future there is no reason for the application of the rule in Pickard v. Sears (1837) 6 A. E. 469 : 45 R.R. 538 (cit. Sup. ) because the parties have only to say, Enter into a contract and then all difficulty is removed. Though Lord St. Leonards dissented, Lord Brougham was in agreement with the Lord Chancellor. The statement of law in Jorden v. Money (1854) 10 E.R. 868 : 23 L.J. Ch. 865 was approved and acted upon by the Privy Council in Chadwick v. Manning (1896) A.C. 231 : 65 L.J.P.C. 42. Their Lordships held that in the absence of a contract, the Defendant in that case could not be estopped from enforcing an agreement of indemnity against the Plaintiff because of a representation, express or implied, by the former to abandon his right under the agreement. To raise an equity on behalf of the Plaintiff there must have been misrepresentation of existing facts and not of mere intention. 39. In another decision of the House of Lords, George Whitechurch, Limited v. Cavanagh (1902) A.C. 117 at P. 130 : 71 L.J.K.B. 402 Lord Macnaghten, with whom the Earl of Hala ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould ground an estoppel: for the meaning so attributed, ia not a representation of an existing fact, but a representation of a future intention, which might or might not be enforceable in contract. 41. The distinction between a statement of fact and a mere promise to do something in the future was, if I may say with respect, clearly brought out by Bose J. (as he then was) in Gharbhoya Bhimji v. Deodatta Bihari A.I.R. 1937 Nag. 400 at p. 405 : 172 I.C. 389. This distinction has to be kept in view in considering the plea of estoppel. 42. Now I proceed to consider the rulings referred to earlier. The earliest case is Nathu v. Thakubai 1 N.L.J. 253 : A.I.R. 1917 Nag. 163. That case arose under the Berar Land Code of 1896. Chapter 18 of that Code oontained no provision similar to Sub-section (3) of Section 174 of the present Code. There are observations of Sir Henry Stanyon apparently favouring the contention of the Respondent here. But there was no decision. After indicating the various possibilities of there having been a contract, ex-press or implied waiver, estoppel by express or implied agreement and estoppel in pais, the learned Additional Judicial Commissioner observed: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or of the isar chitthi (sic) and the sale deed, his refusal to purchase the property when offered to him and his conduct in recovering from the proceeds of the sale what was due by the vendor to the society of which the pre-emptor himself was the sarpanch. 48. It was held in Anandrao v. Kisan S.A. No. 584 of 1944, Dated 5th April 1948, that where a co-occupant encouraged a purchaser to buy and the purchaser acting on that encouragement had bought, it was not subsequently open to the co-occupant to pre-empt him. It is not clear from the judgment what the actual representation of the pre-emptor was in that case. 49. In Jainarayan v. Sadasheo S.A. No. 723 of 1944, Dated 18th November 1948, the pre-emptor failed on the ground of waiver. Subsequent to the sale sought to be pre-empted, the-pre-emptor took a lahan gahan mortgage of the-land in suit from the purchaser. The pre-emptor could enforce the mortgage only by foreclosing, the land. This, it was held, necessarily implied the giving up of his right to pre-empt. The ques-tion of estoppel arose in respect oL another sale subsequent to the one sought to be pre-empted. The contention of the pre-emptor was that he was entitled to i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In a recent case, Nathoo v. Horilal I.L.R. (1945) ALL. 294 : A.I.R. 1945 ALL. 196, Allsop J. doubted the correctness of Oon Mahomed v. Mt. Bint Zohra A.I.R. 1925 ALL. 645 : 87 I.C. 414 and Ranjit Singh v. Bhagwati Singh 48 ALL. 491 : A.I.R. 1926 ALL. 467. The doubts raised by Allsop J., if I may say with respect, are founded on the true principle applicable to the facts before us. 54. In the Punjab too the conception of the right of pre-emption was at times largely influenced by the entries relating to haq-i. shufa in the waj'ib-ul-arz of a village or in the riwaj-i-am of a tribe: See Sanwal Das v. Gur Parshad 1909 P.R 90 . . 400, 410, 411 : 4 I.C. 179. 55. We are not called upon to decide the case on a plea of waiver based on contract. There was no suggestion that the purchaser bought the property either at the desire of the pre-emptor or to benefit him. It is clear the purchaser did not buy the property to oblige the pre-emptor. In short, no agreement enforceable at law can arise without consideration. So there is no need to dilate further on these aspects. 56. The answers to both the questions propounded by me earlier are in the negative. 57. I allow the appeal w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the letters O.K. In other words, I take the view that the second part of the estoppel consists of an estoppel of a principal by the waiver of his agent, in this case the estoppel of Dawson's Bank by the waiver of Ba Maw. These words, which are the true foundation of the judgment, disclose, in their Lordships' opinion, a confusion of thought upon the subjects of estoppel and waiver. The question of estoppel is governed by Section 115, Evidence Act, which for the present purpose seems to their Lordships not to differ from the law in England in regard to estoppel in pais. Estoppel is not a cause of action. It may (if established) assist (sic)a Plaintiff in enforcing a cause of action by preventing a Defendant from denying the existence of some fact essential to establish the cause of action, or (to put it in another way) by preventing a Defendant from asserting the existence of same fact the existence of which would destroy the cause of action. It is a rule of evidence which cornes into operation if (a) a statement of the existence of a fact has been made by the Defendant or an authorized agent of his to the Plaintiff or some one on his behalf, (b) with the intention ..... 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