Property Law

Tanu Ram Bora v. Promod Chandra Das

(2019) 4 SCC 173; AIR 2019 SC 927

Facts

Tanu Ram Bora purchased the suit land from Pranab Kumar Bora through a registered sale deed dated 6 January 1990.
The land had already been declared ceiling-surplus and acquired by the Government in 1988.
Therefore, on the date of sale, the vendor had no transferable title.
Subsequently, on 14 September 1990, the land was declared ceiling-free.
The purchaser’s name was mutated in the revenue records in 1991.
In 1995, Promod Chandra Das unlawfully entered the land.
Tanu Ram Bora sued for declaration of title, recovery of possession and injunction.
The lower courts dismissed the suit because the vendor lacked title on the date of the sale.

Whether the vendor’s subsequently acquired interest could pass to the earlier purchaser under Section 43 TPA.
Whether the purchaser could obtain title even though the vendor had no transferable interest when the sale deed was executed.

Section 43 applies where:
a person fraudulently or erroneously represents that he is authorised to transfer property;
the transfer is for consideration;
the transferee acts upon that representation;
the transferor later acquires an interest in the property; and
the contract remains subsisting.
The transferee may elect to have the subsequently acquired interest applied to the earlier transfer.
The principle is known as feeding the grant by estoppel.

The vendor executed a registered sale deed as though he had complete authority to sell.
The purchaser paid consideration and acted upon that representation.
Nothing showed that the purchaser had been informed that the land had already been declared ceiling-surplus.
When the land was declared ceiling-free in September 1990, the vendor’s interest revived or became legally transferable.
Section 43 prevented the vendor and persons claiming through him from saying:
that he had no title when he sold the land; and
that his subsequently acquired title should not benefit the purchaser.
The vendor’s legal heirs never challenged the sale deed and had accepted the purchaser’s title.
Promod Chandra Das, who had no established title of his own, could not take advantage of the vendor’s temporary defect in title.
The case differs from a transaction where both parties knowingly agree to transfer only a future possibility. Here, the vendor represented that he had a present transferable interest.

Section 43 applied to the transaction.
The interest acquired by the vendor when the land was declared ceiling-free fed the earlier registered sale.
Tanu Ram Bora became entitled to the land.
The Supreme Court restored his decree for declaration of title and recovery of possession.