1) Whether the compromise could be treated as an agreement of
sale and, therefore, the plaintiffs had pre-emptive rights to
purchase the suit property under the said compromise?
2) Whether it was necessary for the plaintiffs to have prayed for
cancellation of the sale-deed?
02. During the course of the hearing, on the request of the learned
3) Whether the appellants are entitled to receive the entire
consideration, which they have paid to the seller?
03. Respondent Nos.2 to 6 (original plaintiffs) filed a suit for
declaration, permanent injunction and possession on the basis of pre-emption
right which was agreed to them by virtue of compromise decree [Exh.42] in
R.C.S. No.92 of 1988. The said suit came to be decreed and the original
plaintiffs were directed to pay an amount of Rs.2,25,000/- to their father viz.
Dolaram Kapgate (original defendant No.1) and to compensate the appellants
and the other original defendants. An unsuccessful attempt was made by the
appellants before the learned District Judge, Bhandara. Therefore, the
appellants approached this Court against the dismissal of their Reg.Civil
Appeal No.33/2002 by the learned District Judge, Bhandara.
04. Having heard the learned Counsel for the respective parties and
having gone through the impugned judgment and the material available on
record, it transpires that the appellants are the purchasers of the suit property
admeasuring area 0.61 hectare out of the entire suit property admeasuring
area 1.21 hectare from the original defendant No.1, father of respondent
Nos.2 to 6.
05. Needless to mention that, in the earlier suit bearing R.C.S. No.
92/1988 between defendant No.1-Dolaram Kapgate and the present
respondent Nos.2 to 6, a compromise decree came to be passed with a
condition that if defendant No.1-Dolaram wants to sell the property, he shall
sell it to the respondents. Defendant No.1-Dolaram issued notice to
respondent Nos.2 to 6 to purchase the property at the rate of Rs.1,00,000/-
per acre. Though, respondent Nos.2 to 6 were ready to purchase the property,
they disagreed on the price. Therefore, defendant No.1-Dolaram sold a part
of the property to the present appellant by executing a sale-deed for a total
consideration of Rs.1,50,000/-.
06. The first appellate Court held that respondent Nos.2 to 4 did not
have any interest in the property under Section 22 of the Hindu Succession
Act, 1956 since defendant No.1-Dolaram was alive. The first appellate Court
though dismissed the appeal of the appellants, but held that the compromise
decree is nothing but a contract as per Section 37 of the Contract Act and
therefore, respondent Nos.2 to 6 have a right to purchase the suit property in
preference to others. No doubt, if a person agrees to sell the property to a
particular person under the compromise-deed rather a compromise decree,
then obviously the said person gets his right of pre-emption in force. Original
defendant No.1-Dolaram under a compromise decree before the Lok-Adalat
had agreed to sell the suit property to respondent Nos.2 to 6 in preference to
others and accordingly, an award came to be passed, which has effect of a
decree. Therefore, the first appellate Court was right in holding that the said
compromise decree is binding on defendant No.1-Dolaram. Rather, Dolaram
himself had issued notices to defendant Nos.2 to 6 for purchase of the
property, but the same could not be materialized due to the difference in the
market price of the property. Therefore, no interference is required in the
findings of the first appellate Court.
07. So far as the consideration part is concerned, the learned
Counsel for the appellants seeks to rely on the decision of the Supreme Court
in the case of Tilak Raj Bakshi vs. Avinash Chand Sharma (Dead), through
Legal Representatives and others1 wherein the Court while discussing the case
of Bishan Singh vs. Khazan Singh 2 has reiterated the principles relating to
exercise of pre-emption in paragraph 42 as under:
(1) The right of pre-emption is not a right to the thing sold but a
right to the offer of a thing about to be sold. This right is called
the primary or inherent right.
(2) The pre-emptor has a secondary right or a remedial right to
follow the thing sold.
(3) It is a right of substitution but not of repurchase i.e. the pre-
emptor takes the entire bargain and steps into the shoes of the
original vendee.
(4) It is a right to acquire the whole of the property sold and not a
share of the property sold.
1 (2020) 15 SCC 605
2 AIR 1958 SC 838
(5) Preference being the essence of the right, the plaintiff must have
a superior right to that of the vendee or the person substituted in
his place.
(6) The right being a very weak right, it can be defeated by all
legitimate methods, such as the vendee allowing the claimant of
a superior or equal right being substituted in his place.
08. Thus, in view of the legal position reiterated by Their Lordships
in the case of Tilak Raj Bakshi (supra), the pre-emptor takes the entire
bargain and steps into the shoes of the vendee under a right of substitution
but not of repurchase. Since, a consideration of Rs.1.50 lakhs has been paid
by the appellants to the original defendant No.1-Dolaram and the respondents
have no better right than being substituted in place of the respondent Nos.2 to
6, they have to pay the price which has been paid by the appellants i.e.
Rs.1.50 lakhs. Therefore, the amount of consideration decided to be paid to
the appellants by the first appellate Court as well as the trial Court is not a
correct one. To that extent, the appeal succeeds. Hence, the following order:
I. The appeal is partly allowed.
II. Respondent Nos.2 to 6 to pay Rs.1,50,000/- to the appellants.
III. On depositing the remaining amount of Rs.37,500/- before this
Court, the appellants shall execute a sale-deed in favour of
respondent Nos.2 to 6.
IV. The amount deposited by the appellants is permitted to be
withdrawn and be given to the appellants along with the accrued
interest thereon.
V. There shall be no order as to costs.
(M.W. Chandwani, J.)
*sandesh
Signed by: Mr. Sandesh Waghmare
Designation: PS To Honourable Judge
Date: 17/03/2025 14:43:51
