M. N. DODAMANI & ORS. versus U.S. D. WALIKAR (DEAD) BY LEGAL REPRESENTATIVES & ORS.

Citation: [1981] 1 S.C.R. 123 · Decided: 29-07-1980 · Supreme Court of India · Bench: A.C. GUPTA · Disposal: Dismissed

Judgment (excerpt)

• 
123 
M. N. DODAMANI & ORS. 
v. 
U.S. D. WALIKAR (DEAD) BY LEGAL REPRESENTATIVES & 
ORS. 
July 29, 1980 
[A. C. GUPTA AND P. N. SHINGHAL, JJ.] 
Bombay Agricultural Debtors Relief Act, 1947. Sections 4 and 25(il)--Scope 
of-Notice-Section if excludes constructive notice. 
Section 25(ii) of the Bombay Agricultural Debtors' Relief Act, 1947 pro-
vides that nothing in section 24 shall apply to any bona fide transferee for 
value without notice of the real nature of such transfer or his representative 
where such transferee or representative holds under a registered deed executed 
on or before 15th February, 1939. 
The predecessors in interest of the appellants transferred two plots of land 
in 1927 to one Krishnaji. The document evidencing the transfer of the plots 
was described as a sale' deed and contained a statement that the vendors had 
absolutely sold both the said lands to him, that the entire ownership was his 
"alone" and that possession had been given to him. In 1932 and 1935 Krishnaji 
sold the two plots to the predecessors in interest of the respondents at a price 
lower than that paid by him when he purchased the plots. 
After the coming 
into force of the 1947 Act the appellants applied under section 4 of the Act 
for adjustment of debts claiming that the transaction of 1927 was really not a 
sale but a mortgage, 
Although the trial court came to the conclusion that the transaction was a 
mortgage and not a sale it dismissed the application on the ground that the 
respondents were entitled to protection under section 25(ii) of the Act. 
On 
appeal the District Judge allowed the application under section 4. In revision, 
the High Court recorded a consent order that the transaction was not a sale 
but a mortgage and remitted the case to the trial court for a decision whether 
the purchasers were transferees for value without notice of the real nature 
of the transaction and were entitled to protection of section 25(ii). 
On remand the trial court dismissed the application under section 4 hold-
ing that the purchasers were bona fide transferees for value without notice of 
the real nature of the original transaction. The lower appellate court reversed 
this decision. The High Court set aside the order of the appellate court and 
restored that of the trial court on the view that the purchasers had no actual 
knowledge or notice of the real nature of the transaction of 1927. It also held 
that the notice contemplated by section 25(ii) was actual notice and that con-
structive notice was clearly beyond the contemplation of section 2.5(ii). 
Dismissing the appeal, 
A 
B 
c 
D 
E 
F 
HELD: Construing the notice referred to in section 25(ii) as actnal notice 
It 
only is likely to defeat the purpose of the statute which was enacted to provide 
for the relief of agricultural debtors in the province of Bombay. Section 25:ii) 
does not exclude constructive notice. [126A-B] 
9-646 S.C. India/ 80 
124 
. SUPREME COURT REPORTS 
[1981] 1 S.C.R • 
A' 
In the instant case, however, the transferees had no notice, actual or con:-
structive, of the real nature of th: trrnsact;oTl ~f 1927~ [126B] 
· 
The fact that the lands were sold to the respondents f~r a pric, lower 
than what they fetchOO in 1927 might have been due to various reasons and 
it cannot be said that this ground alone waS sufficient to faise a suspicion that 
the transaction was realiy a mortgage. The Act of 1947 could not have been 
within the contemplation of any one in 1932 or 1935 ·when the lands were sold. 
The lands were fallow and barren. The record of rights does not contain any 
indication that the transaction was a mortgage. 
The transferees were put in 
possession of the lands. Therefore there was no occasion or circumstance to 
impel the transferees to start an enquiry as to the real nature of the transac-
tion between the seller _and thei predecessors-in-interest Of the appeIIants in 
1927. [126F-H, 127A·B] 
c 
OVIL APPELLATE JURJSDICITON : Civil Appeal No. 691 of 1970. 
D 
F 
G 
H 
, Appeal by Special Leave from the Judgment and Order dated 
12-8-1969 of the Mysore High Court in Civil Revision Petition No. 
1322 of 1967. 
S. S. lavali, M. Veerappa ·and/. R. Das for the Appellant. 
S. C. Javali, P. G. Gokhale and B. R. Agarwa!a for the 
Resi\ondents.-. 
The Judgment of the Cotirt was delivered by 
GUPTA J.-The only question that arises for decision 
in this 
appeal by special leave is whether the respondents before us are entitled 
to relief unde

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