P L D 1956 (W (PLP)

RAHMAN, C. J.‑The facts leading up to this second appeal are as follows. On the 30th of September 1937, Muhammad Bashir deceased and the first three defendants in this suit, sold 18 kanals and 2 marlas of land being part of khasra No. 375, for Rs. 1,200 to Allah Ditta deceased, father of Muhammad Shafi defendant No. 8and‑Abdul Ghani defen dant No. 9 per the registered sale deed, Exh. P.

1. Muhammad Bashir claimed to be sole owner of the share transferred by him though in the Revenue records, his minor brothers, Muhammad Anwar and Muhammad Iqbal were also shown as co‑owners. Allah Ditta transferred this very land further to Muhammad Shafi and others, plaintiffs in the case, per the registered sale deed dated the 27th Tuly 1938, Exh. P.

4. On the Nth of May 1938, Muhammad Bashir for himself and his two minor brothers sold 3 kanals and 6 marlas of land compris ed within khasra No. 371, to Hasham Din, defendant No. 7, for Rs. 300, per the registered sale dead, Exh. P.

2. Hasham Din in turn conveyed the land, which he had brought under this sale deed, to the plaintiffs, on the 14th December 1938, by means of the sale deed, Exh. P.

6. On the 24th of May 1938, again, Muhammad Bashir deceased, acting on his own behalf and that of his two minor brothers, and defendants 1 to 3, sold 29 kanals and 7 marlas of land, falling within khasra Nos. 370, 373 and 376 for Rs. 2,500 to Hasham Din, defendant No. 7, per the registered sale deed, Exh. P.

3. There was a further sale of this land by Hasham Din, on the 25th of May 1938 to the plaintiff's, per the registered sale deed, Exh. P.

5. The plaintiffs continued in possession of the property thus acquired by them by the three sales in their favour, but on the 8th of November 1947, the minor brothers of Muhammad Bashir, who are defendants Nos. 10 and 11 in this case, succeeded in obtaining a decree for 25 kanals and 2 marlas of land against the plaintiffs. They had attained majority by then and brought the suit on the footing that their brother Muhammad Bashir had no legal authority to transfer their share in the joint property. The decree was one for joint possession against the plaintiffs and awarded the share of the minors in the sold land to them. The plaintiffs then brought the present suit for indemnification out of other land possessed by the original transferors or their heirs, defendants 1‑9, on the 9th of August 1949. This was decreed by the trial Civil Judge on the 18th of August 1950 for an area of 9 kanals and 6 marlas of land. On appeal, however, the Senior Civil judge, by order dated the 5th of June 1951, remanded the case and directed that defendants Nos. 10 to 32 be also impleaded as parties, as it transpired that the property had come into their hands by various transfers. An amended plaint was, therefore, put in on the 25th of July 1951 and defendants 10 and 11 were also made parties therein. The trial Court found, by order dated the 9th of May 1952, that the plaintiffs had a right to be indemnified from the property of their transferors, that the defendants Nos. 12 to 26 were bona fide transferees for value without notice of the plaintiffs' claim and that the suit was barred by time, under Article 83 of the Schedule to the Limitation Act. Regarding defendants Nos. 27 to 32, it was held that they had taken the land on transfer, pendente lite, and were not protected. However, even as against them the plaintiffs were non‑suited on the ground that they had failed to prove dispossession from any area sold to them. In consequence of these findings, the suit was dismissed and the parties were left to bear their own costs. The plaintiffs appealed to the Senior Civil Judge, Sialkot, who found that none of the defendants was a bona fide transferee for value without notice, as registration of the sale deeds in favour of the plaintiffs constituted notice in law to them. The suit was held to be within time as Article 83 was read with Article 116 of the Schedule to the Limitation Act. A finding was also recorded that the plaintiffs had been actually dis possessed and consequently had a good cause of action. A decree was, therefore, awarded to them for 25 kanals and 2 marlas of land against defendants Nos. 1 to 9 and 12 to

32. The suit was dismissed as against defendants Nos. 10 and 11, the brothers of Muhammad Bashir deceased, as no relief could be granted against them. The unsuccessful defendants have now come up in second appeal to this Court. It was conceded on behalf of the appellants by Mr. Muhammad , Akram, their learned counsel, that the plaintiffs were entitled to be indemnified for the loss they had sustained on account of the action of Muhammad Bashir's minor brothers when they came of age, but it was contended that the plaintiffs could not follow the lands which had been transferred by the original vendors to the defendants‑appel lants, for this purpose. The sale deeds P. 1 to P. 3, in favour of the plaintiffs' vendors, undoubtedly contain clauses to the effect that, if due to any defect in title or to a claim being made by the minor brothers of Muhammad Bashir, at any time, the transferred land went out of the possession of the vendees, partly or wholly, they would have the right to be indemnified from the other property belonging to Muhammad Bashir or defendants 1‑3, measuring 31 kanals and 6 marlas and bearing khasra Nos. 370, 376 and 385 in the village of Nawan Pind. It is to be noticed that khasra Nos. 370 and 376 were purchased eventually by the plaintiffs themselves vide Exh. P/3 and Exh. P/5. In so far as there was a covenant for title, whether express or implied, the plaintiffs, it is conceded, stepped into the shoes of their own vendors and could seek to be indemni fied for their loss. It was, however, urged that they could not take advantage of the indemnity clause in favour of their vendors to be reimbursed out of the specific property mention ed in that clause as this constituted a personal right inherent in the plaintiffs' vendors and had not been assigned to the plaintiffs. Moreover that property was no longer with the original vendees. By the sale deed, Ex. D. W. 2/1, dated the 27th of May 1938, defendants Nos. 1 to 3 and Muhammad Bashir deceased for himself and his two minor brothers, had transferred 19 kanals and 2 marlas out of 26 kanals and 16 marlas of land in khata No. 4, bearing khasra Nos. 350, 355 and 356 in village Nawan Pind for Rs. 1,500 in favour of one Hasham Din (to be distinguished from defendant 7 of the same name) now represented by defendant No. 16 in the case. The property, which was the subject‑matter of this sale deed, was sought to be availed of by the plaintiffs for indemnification. By Exh. D. 3, dated the 17th of May 1939, again, defendants Nos. 1 to 3 sold 1 kanal and 18 marlas of land, being their one third share in khasra Nos. 385 of khata No. 6/16, for Rs. 500, in favour of Nizam Din deceased whose sons were impleaded in the suit as defendant Nos. 12 to

15. It will be noted that this khasra number was one of the specific numbers mentioned in the indemnity clause in Exh. P. 1 in favour of the plaintiffs' vendors. Exh. D. 2/A is another sale deed, dated the 17th of May 1939, executed by Muhammad Bashir deceased for himself and his younger brothers, in respect of 16 kanals and 3 marlas of land comprised within khasra Nos. 386 and 387 (whole and two‑thirds of 5 kanals and 15 marlas comprised within khasra No. 385, to Nizam Din, lather of defendants Nos. 12 to 15, for Rs. 1,

500. This khasra number 385, is also mentioned in the original covenant of indemnity. The fourth relevant document is Exh. D. 1/1, dated the 28th of February 1950, which is a sale deed executed by the heirs of Muhammad Bashir deceased, namely, his widow, who acted for herself and her two minor daughters (defendants 4‑6 in this case) trans ferring 8 kanals and 2 marlas of land being one‑third of 24 kanals and 6 marlas out of khasra Nos. 502/341, 504/342, 396, 399, 506/416 and 374/6 in favour of S. Muhammad Shah deceased, predecessor‑in‑interest of defendants Nos. 27 to

32. This was the sale which was held to be affected by the doctrine of lis pendens in the Courts below. The main contention advanced on behalf of the appellants is that the plaintiffs, being subsequent vendees not privy to the covenant of indemnity contained in the sale deeds, Exhs. P. 1 to P. 3, given to the predecessors‑in‑title of the plaintiffs, the latter could not base their claim on such a covenant which did not run with the land. Such a conve rsant of indemnity, it was suggested, was to be distinguished from the covenant of implied title, referred to in subsection (2) of section 55 of the Transfer of Property Act, and which would pass with the land for the benefit of any subsequent transferee. Learned counsel relied on Mst. Banti v. Mandu (A I R 1928 Lah. 357 (D. B.)), Natesa Vanivan v. Govalasami Mudaliar (A I R 1928 Mad. 894 (D. B.)), Dugar Mal v. Gobind Saroop (A I R 1950 East Punjab 74 (D. B.)) and Doughty v. Bowman ((1948) 11 Q. B. 444). The first case cited was a decision by a Division Bench of the Lahore High Court in a pre‑emption suit. It was held therein that the right of substitution of the pre‑emptor for the vendee should be deemed to be limited in its operation to the property actually conveyed by means of the sale deed and any covenant given by the vendor to the vendee to indemnify him either by cash compensation or by delivery of the other property of the vendor, was not enforceable at the instance of the pre‑emptor. The learned judges observed that a covenant running with the land was to be distinguished from a personal covenant, such as a covenant of indemnity entered into by the vendor in favour of the vendee. Shadi Lal, J. of the same Court, while deciding the case of Bishen Singh v. Mst. Bishni and two others (103 P R 1919) had expressed doubt about the correctness of a similar view taken in Sandhe Khan v. Bhana and others (141 P R 1907) but the learned judges who decided Banti v. Mandu, characterized the expression of that doubt as a mere obiter dictum. In the second case, which was from the Madras High Court, the facts were that a lady sold her land to S. S., and, at the same time, her husband S. A. executed a security bond undertaking that if S. S. should be deprived of any part of the property sold for any reason, he would compensate him with equivalent property. The transferred property was, however, sold at a Court‑auction in execution of a decree against S. S. and was purchased by P. Meanwhile a son of the transferor sued to set aside the sale and succeeded in obtaining a decree. P then used to enforce the security bond. It was held that the security bond was not a covenant running with the land, and was, therefore, not enforceable at the instance of P. The learned judges pointed out that a cove nant running with the land must be one that touches or concerns the land demised and that indemnity covenants are personal in their character or collateral to the main transac tion and do not run with the land. The case however appears to be distinguishable as the indemnity was given by a third person and not by the vendor herself. In the East Punjab case, it was laid down that a person taking a transfer in invitum (e.g., taking a property with the aid of Court in exercise of a decree) was not entitled to take advantage of section 55 (2) of the Transfer of Property Act as embodying a rule of justice, equity and good conscience in places where the Transfer of Property Act did not apply. The provisions of the section, it was pointed out, went beyond the ordinary rule of English law. That was actually a pre emption case and it was held that, if a pre‑emptor brings a suit for damages for defect in title, he cannot rely on a covenant for indemnity given' by the vendor to the vendee as it does not run with the land. The Lahore decision cited above was followed by the learned Judges. In the English case relied on, it was ruled that a covenant to indemnify is not ad idem with a covenant for quiet enjoy ment. The former is larger in scope and does not pass with the estate. Another English authority, in which a similar view was taken, is London and South Western Railway Com pany v. Gomm ((1882) 20 Chancery Division 562). That case related to an action of specific performance of a contract entered into, not by the defendant but by his assignor. It was conceded in the course of argu ments that the covenant not given by the defendant did not bind him at law, but it was argued that it bound him in equity because he had bought the land knowing of that covenant. It was held that the equitable doctrine only applied to restric tive covenants and not to personal covenants of this nature. For the respondents, Mr. Muhammad Shafi drew my atten tion to the following authorities in support of his position that a covenant of this type would pass with the land Asdesir v. Vajesing (1 L R 25 Bom. 593), Tulsi Ram and others v. Murlidhar Chaturbhuj Marwadi (1 L R 26 Bom. 750), Pappu Raddiar v. Pichu Ayyar and others (A I R 1935 Mad. 961 (S. B.)), Hanwant Rai v. Chandi Prasad and others (A I R 1929 All. 293 (D. B.)), Bapu Shivaji Naik and others v. Kashiram Hanmantrao Ghag (A I R 1929 Bom. 361 (S. B.)), Muhammad Siddiq and others v. Muhammad Nuh () A I R 1930 All. 771 (D. B.)), Ramayya and others v. Kotayya and others (A I R 1930 Mad. 748 (S. B.)) and Sheikh Moin‑ud‑Din v. Magbul Alam and others (A I ‑R 1934 All. 461 (D. B.)). In case No. (1), the sale deed contained the usual cove nant for quiet enjoyment of the plots of land sold. Possession was taken by the vendee, of some plots out of the transferred property and subsequently he brought a suit for possession of the other plots or alternatively for compensation against the vendor and the occupants of the remaining plots. It was found that the title of the vendor had extinguished in the remaining plots at the time of the sale and the real question that was decided was whether the suit was barred by time or not. The decision is, therefore, not helpful in deciding the point that arises in the present case. The second case was also from the Bombay High Court. In 1880, the first and second defendants for themselves and for the third defendant sold a house to the plaintiff's father giving a covenant for quiet enjoyment. The plaintiff sued for possession in 1892. It was held that the third share in the house, belonging to defendant No. 3, did not pass by the sale and the plaintiff was, therefore, awarded only two‑thirds of the house. On the 24th of August 1899, the plaintiff sued to recover damages from defendants 1 and 2 on account of the dispossession from the house. It was held that the claim was to recover money on an existing consideration that had failed and that, therefore, the suit fell under Article 97 of the Schedule to the Limitation Act and not Article 83, on the view most favourable to the plaintiff, treating the sale as voidable and not void. The suit was held to be barred, nevertheless as it was not brought within three years of the dispossession. The limitation in that case really ran from the date of the sale itself and the covenant relied upon was not in fact a covenant of indemnity such as the one I am considering in this case. The third case, which was from Madras, is a Single Bench decision, which contained a casual remark to the effect that under section 55 (2) of the Transfer of Property Act, the indemnity, which defendant No. 2 had as against defendants Nos. 7 and 8, would no doubt be available to the plaintiff as well. The remark is not supported by any reasoning and affords no assistance in determining the point at issue here, which does not concern the covenant of title embodied in section 55 (e). The next case was from the Allahabad High Court, in which the learned judges decided that a vendee from a pre emptor is entitled to take the benefit of an express covenant to indemnify contained in a sale deed given by the original vendor. This view is, however, opposed to that taken in Mst. Banti v. Mandu (A I R 1928 Lah. 357) discussed above, and I am not disposed to follow it in preference to the Lahore High Court's view. The fifth case, which was from the Bombay High Court, appears to be distinguishable on the facts from the instant case. There A sold the property to B without giving possession. B sold it to C who obtained possession by suit against A. The co‑sharers of objected and C retained possession of one half only to which A was entitled. He subsequently sued A for damages. It was held that C was entitled to recover not the purchase money but damages in lieu of possession under section 55 (2) of the Transfer of Property Act and the cause of action must be deemed to have arisen when the imperfection of the defendants' title was first declared. It appears from the body of the judgment that the subsequent sale also contained an indemnity clause. The sixth case, which was from the Allahabad High Court, involved a question of covenant for title and quiet enjoyment and not one of indemnity. In so far as it takes the view adopted by the Allahabad High Court in Hanwant Rai v. Chandi Parasad and others (A I R 1929 All. 293), concerning the pre‑emptor's right to substitution for the vendee in all respects, I do not see my way to follow it. In the seventh case, which was from the Madras High Court, the question decided was quite different from the one arising here. The learned single judge who decided the case held that where a purchaser of immovable property was dispossessed owing to lack of title in the vendor, he could claim by way of damages, not only the actual price paid by him but could also recover the enhanced value of the property at the time of his eviction. The case was one of implied covenant under section 55 (2) of the Transfer of Property Act. An attempt was made by the Allahabad High Court in Sheikh Moue‑ud‑Din v. Maqbul Alam and others (A I R 1934 All. 461) to distinguish the ruling reported as Natesa Vaniyan v. Gopalasami Mudaliar (A I R 1928 Mad. 894) on grounds which do not appear to be material, if I may say so with all respect. The learned judges adhered to the view taken by their Court in the rulings noticed above. On a review of these authorities, I find that a covenant for indemnity, such as the one given in the sale deeds, Exhs. P. 1 to P. 3 in the present case, is not annexed to o. inherent in the land so that it could pass to the subsequent transferees, namely, the plaintiffs. It was a covenant personally given to the predecessors‑in‑title of the plaintiff and was not assigned to the latter. The plaintiffs, being neither the parties nor privies to the original contracts, Exhs. P. 1 to P. 3, are, in my opinion, not entitled to rely or them. The indemnity clause contained in them was of w personal character and is to be distinguished from an implied covenant of title. The general principle is that a persona covenant even though it may have reference to property in binding up as between the parties thereto or their privies. It is not as a general rule enforceable against third person into whose hands the property may have passed, unless they took the property with notice of the covenant or gratuitously. Such a covenant affects the land not directly but only collaterally. The indemnity clause in the present case may have an analogy to a contract to sell in a certain contingency and such a covenant does not pass with the land. At best it may be enforceable under the conditions mentioned in section 40 of the Transfer of Property Act. The second question that calls for determination is whether registration of the documents, Exhs. P. 1 to P. 3, was sufficient notice to the subsequent transferees, defendants Nos. 12 to

16. Defendants 17‑26 were merely pro forma defendants, being lessees or tenants under defendants 12‑

16. The learned Senior Civil Judge has accepted the proposition that registration simpliciter would be enough notice to the subsequent transferees. Section 3 of the Transfer of Property Act was amended in 1929 and the section, as it now stands with its explanations, provides that where any transaction relating to immovable property is required by law to be and has been effected by a registered instrument, any person acquiring such property or any part of, or share or interest in, such property shall be deemed to have notice of such instrument as from the date of registration. This section also lays down that a person is said to have notice of a fact when he actually knows that fact, or when, but for willful abstention from an inquiry or search which he ought to have made, or gross negligence, he would have known it. There is no evidence in the present case that actual notice was given of the transactions embodied in Exh. P. 1 to P. 3 to the sub sequent transferees. I do not think, at the same time, that any constructive notice can be imputed to these transferees on the facts of this case. In the region, formerly known as the Punjab, the Transfer of Property Act was not in force and its provisions could only be pressed into service as embodying principles of justice, equity and good conscience. The state of the law in the region before the 1929 amendment .of section 3 envisaged that registration by itself did not amount to notice. The Act not being in force here, the position remains the same, even after the amendment, as was held by Din Muhammad, J., of the Lahore High Court in Mst.' Ghulam Fatima v. Mst. Gopal Devi and another (AIR1940Lah.269). Even in terms, the section does not appear to me to be applicable. These subsequent transferees did not take the very property which forms the subject‑matter of the deeds, Exh. P. 1 to P.

3. They took different property though forming part of a joint khata with the property mentioned in those documents. No other circumstances were proved which could lead to the clear inference that these subsequent transferees must have been aware of the covenant regarding the indemnity contained in Exh. P. 1 to P.

3. The leading case on the point is Tilakdhari Lal v. Khedan Lal (AIR1921PC112). The question of notice is one of fact to be determined on the circumstances of each case, I, therefore, hold that the finding of the learned Senior Civil judge on this point was erroneous and these particular defendants were protected on the ground that they were bona fide transfers for value without notice. Before 1947 when the cause of action arose to the plaintiffs, the original vendors had parted with the property, which was mentioned in the indemnity clause, in favour of others. The plaintiffs, therefore, misconceived their action inasmuch as they demanded to be recompensed out of the very property men tioned in the indemnity clause though it had passed to third parties who had paid good consideration without notice. These subsequent transferees had taken the property long before the defect in the title became apparent. On the question of limitation it does not appear necessary to dilate. There is authority for the view that where the indemnity clause to be availed of, is contained in a registered instrument, the limitation is six years from the date of actual demnification, reading Articles 83 and 116 of the Schedule to the Limitation Act together. Reference in this connection may be made, inter alia to Kartar Singh and others v. Sant Singh and others (A I R 1940 Lah. 321 D. B.), Hanwant Rai v. Chandi Prasad and others (A I R 1929 All. 293 D. B.) and Muhammad Siddiq and others v. Muhammad Nuh (A I R 1930 All. 771 D.B,). I find myself in agreement with the Courts below that those defendants, who took the property during the pendency of the suit, could not resist the plaintiffs' action for indemnification out of the property of the original vendors transferred to them by the mere fact of sale in their favour, subject to what is said hereafter. I further agree that defendants Nos. 10 and 11, the brothers of Muhammad Bashir, had been wrongly impleaded in the case and that no relief could be sought against them. The upshot of the above discussion is that the plaintiffs are not entitled to follow the land now in the possession of defendants Nos. 12 to 16 in the case, but that defendants Nos. 27 to 32 are by no means protected against attack, merely on the ground of the sale in their favour though they may resist the suit for other reasons. The matter, however, does not rest here. In the plaint (vide clauses 11 and 19) prayer is made for compensation out of specific khatas, 4, 6, 20, 21, 23, 24, 36, 45, 46, 50 and 52 of the jamabandi 1937‑38, alleged to belong to the original vendors. It is now conceded before me by learned counsel for both parties that, according to the jamabandi copies on the file, khatas 23, 36, 45, 46 and 50 do not in fact belong to those vendors. In khata 20, Khasra No. 374 was transferred per Exh. D. 1/1, pendente lite, by the heirs of Muhammad Bashir deceased, defendants 4‑‑6, to the predecessor‑in -interest of defendants 27‑

32. Out of khata 24, again, by the same sale deed, khasra Nos. 396, 399 and 506/416 were transferred to the same purchasers. The rest of the specific khatas mentioned in the plaint, were either eventually pur chased by plaintiffs themselves or were transferred to the protected defendants 12‑

16. Even against the unprotected defendants 27‑32, the) plaintiffs have no cause of action as they stand in the shoes F of the original vendors with whom the plaintiffs had no privity of contract. The plaintiffs, could only sue their own vendors or their successors‑in‑interest, viz., defendant No. 7 Hashim Din and defendants 8 and 9, who are sons of Allah Ditta, for money compensation in view of their dis possession of part of their bargain. The suit merited dismissal against all defendants except defendants 7‑

9. Learned counsel for respondents plaintiffs has orally requested me to permit an amendment of the plaint so as to allow plaintiffs to pay proper Court‑fees and to ask for money compensation from defendants 7‑

9. The last clause in the plaint did ask for "any other appropriate relief that the Court may deem just." If the plaintiffs were to bring a fresh suit now for, money compensation, it will be barred by time. After considering the circumstances of the case, I hold that it will be just to accede to this request. I allow the appeal and dismiss the suit against all defendants except defendants 7‑

9. Against the latter defendants an amended plaint asking for money compensation will be allowed to be put in by the trial Court on payment of the requisite Court‑fee and the case will proceed against them in accordance with law. In view of the difficult nature of the questions involved in the case, the parties besides defendants 7‑9, as against one another, will bear their own costs throughout. As between plaintiff and defendants 7‑9, costs will abide the final event. Incidentally I might observe that the trial Court's, remark that defendants 17 and 23 had admitted plaintiffs' claim is not based on any material or evidence on the file and this is admitted by learned counsel for the plaintiffs. Announced. A.H Order accordingly.