UNIVERSITY INSTITUTE OF LEGAL STUDIES, PANJAB UNIVERSITY,

CHANDIGARH

Ram Baran Prasad v. Ram Mohit

Hazra (AIR 1967 SC 744)

(SUBJECT: LAW OF PROPERTY)

SUBMITTED TO: SUBMITTED BY:

PROF. ALAMDEEP KAUR HEMANT GARG

U.I.L.S. B.COM L.L.B. (H)

PANJAB UNIVERSITY SEMESTER- V

CHANDIGARH ROLL NO. - 253

SECTION- E
 ACKNOWLEDGEMENT

In the accomplishment of this project successfully, many people have bestowed upon me their
blessings and the heart pledged support. I thank to all those people who have helped me in this
project.

I would like to take this opportunity to express my gratitude to Prof. Alamdeep Kaur who
gave me the opportunity to do this wonderful project for the subject of LAW OF PROPERTY
on the case law “RAM BARAN PRASAD V. RAM MOHIT HAZRA”. The project helped
me learn how to do proper Research and I learned about many new things while doing the
project.

I would also like to thank my parents and friends who helped me complete this project within
the deadline. I will always be indebted to them.
 TABLE OF CONTENT

SR. NO. TOPIC PAGE NO.

1. INTRODUCION 4

2. FACTS 5

3. ISSUES 6

4. JUDGEMENT 6

5. SYNOPSIS 7

6. CONCLUSION 8

7. BIBLIOGRAPHY 9
 INTRODUCTION

The case law of Ram Baran Prasad v. Ram Mohit Hazra 1, generally talks about the
Preemption and S.14 Rule against Perpetuity.

Preemption means the right of purchasing before others. It means that one will be given
opportunity to purchase that thing before asking others to buy it.

S14. Rule against Perpetuity-No transfer of property can operate to create an interest which is to
take effect after the life-time of one or more persons living at the date of such transfer, and the
minority of some person who shall be in existence at the expiration of that period, and to whom,
if he attains full age, the interest created is to belong. 2

In Ram Baran Prasad v. Ram Mohit Hazra, it is decided that whether the preemption agreement
between parties binds the successor-in-interest or not?

Also , whether Rule of Perpetuity is offended here or not?

1
AIR 1967 SC 744
2
https://blog.ipleaders.in/rule-aganist-perpetuity-perpetual-transfers/ (last visited on 6 Nov,2021)
 FACTS

Two brothers, Tulshidas Chatterjee and Kishori Lal Chatterjee, owned certain properties (land
and building) on Paharpur Road, mouza Garden Reach, Kidderpore, in the suburbs of Calcutta.
In or about the year 1938, Kishori sued for partition of the said properties and, eventually, the
matter was referred to arbitration. On 16th December, 1940, the arbitrators filed their award, on
which a decree was passed on March 15, 1941. Under the award, which formed part of the
aforesaid decree, two of the four blocks A, B, G, D into which the disputed properties were
divided by the arbitrators, were allotted to Kishori and the remaining two to Tulshi, Kishori's
blocks being B and D and Tulshi's A and C. Two common passages X. and Y and a common
drain Z were kept joint or ejmali between the parties for their use. On August 20, 1941, Tulshi
sold his A block to one Nagendra Nath Ghosh (vide Ext. A). This was done after Kishori's
refusal to pre-empt the same in spite of Tulshi's first offer to him in terms of the above pre-
emption clause. Then, on April 22, 1942, Kishori, by the kobala Ext. I, Sold his two blocks B
and D to certain persons whom, for convenience, we shall call the Mukherjees, and, on June 21,
1946, the latter, in their turn, sold the said properties to the present plaintiffs, who are the
respondents before us, and who may, for the sake of brevity and convenience, be described as the
Hazias. This latter sale was effected by the kobala Ext. 1(a). Then, on 20th September, 1952,
Nagendra sold his block A to defendant No. 1 (vide kobala Ext. A-1), and, on 2nd December,
1952, the present suit was filed by the plaintiff against the said purchaser, defendant No. 1, for
pre-empting his aforesaid purchase. On 7th April, 1953, while the suit was pending in the trial
court, defendant No. 1 sold the disputed property (Block A) to defendant No 2 and the latter also
resisted the plaintiffs' claim, along with his vendor defendant No. 1.
 ISSUES

1. Whether the preemption agreement between parties binds the successor-in-interest or

not?
2. Whether Rule of Perpetuity is offended here or not?

JUDGEMENT

(i) It is true that the preemption clause does not expressly state that it is binding upon the
assignees or successors-in-interest, but, having regard to the context and the circumstances in
which the award was made it was manifest that the preemption clause must be construed as
binding upon the assignees, or successors-in-interest of the original contracting parties. Section
23, 27(b) and 37 of the Specific Relief Act lay down that subject to certain exceptions a contract
in the absence of a contrary intention express or implied will be enforceable by and against the
parties and their legal heirs and legal representative including assignees and transferees. In the
present case there was nothing in the language of the preemption clause or the other clauses of
the award to suggest that the parties bad any contrary intention. On the other hand a reference to
the other clauses of the award showed that the parties intended that the obligations and benefit of
the contract should go to the assignees and successors-in-interest. The pre-emption clause was
based on the ground of vicinage and this circumstance also suggested that the intention of the
parties was that the pre-emption clause should be binding upon the heirs and successors-in-
interest and the assignees of the original parties to the contract.
(ii) The rule against perpetuities does not apply to personal contracts which do not create
interest in property.
Reading s. 14 along with s. 54 of the Transfer of Property Act it is manifest that a mere
contract for sale of immovable property does not create any interest in the immovable
property and it therefore follows that the rule of perpetuity cannot be applied to a covenant of
pre-emption even though there is no time limit with-in which the option has to be exercised.
Accordingly the covenant for pre-emption in the present case did not offend the rule against
perpetuities and could not be considered to be void in law. 3

3
https://indiankanoon.org/doc/1950151/ (last visited on 8 Nov, 2021)
 SYNOPSIS

The case law of Ram Baran Prasad v. Ram Mohit Hazra, generally answers the following two
questions-

1. Whether the preemption agreement between parties binds the successor-in-interest or

not?
2. Whether Rule of Perpetuity is offended here or not?

In this case law, it was held that preemption agreement in the absence of a contrary intention
express or implied between parties will bind the successor-in-interest or assignees or legal heirs
or legal representatives subject to certain exceptions. As there was no sign of contrary intention
in the preemption agreement, it was held that here preemption agreement will bind the successor-
in-interest.
Also, it was held that the rule of perpetuity was not offended here as a mere contract for sale
of immovable property does not create any interest in the immovable property and it therefore
follows that the rule of perpetuity cannot be applied to a covenant of pre-emption even though
there is no time limit with-in which the option has to be exercised.
Accordingly the covenant for pre-emption in the present case did not offend the rule against
perpetuities and could not be considered to be void in law.
 CONCLUSION

Rule against Perpetuity has been dealt under sec.14 of Transfer of Property Act,1882. Perpetuity
simply means “indefinite Period”, so this rule is against a transfer which makes a property in
alienable for an indefinite period.
The Hon’ble Court used the precedents like Aulad Ali v. Ali Athar 4, Gopi Ram v. Jeot Ram5 and
dismissed the appeal mentioning sec. 23(b), 27(b) of Special Relief Act and sec. 37, 40 of Indian
Contract Act.
The Hon’ble Court hold that the decision of the High Court is correct and this appeal must be
dismissed with costs.

4
I.L.R. 49 All. 527
5
I.L.R. 45 All. 478
 BIBLIOGRAPHY

Book

 Dr. Avtar Singh The Transfer Of Property Act ( Universal Law Publishing Co. Pvt. Limited,
New Delhi, 3rd edition,2014)
 Dr. S. N. Shukla The Transfer Of Property Act ( Allahabad Law Agency,Faridabad,26th
edition.2015)

Website

 https://blog.ipleaders.in/rule-aganist-perpetuity-perpetual-transfers/
 https://indiankanoon.org/doc/1950151/