Ramaswami, J.:— This appeal is presented under the Letters Patent from the judgment of Reuben, J. (as he then was) in a second appeal.

The plaintiff Bamdeb Das brought the suit on the allegation that he was the 16 annas landlord of a chandna tenancy of which defendant no. 2 Bhramarbar Choudhuri was the recorded tenant. The plaintiff alleged that Bhramarbar Choudhuri had transferred the, holding to his wife Rupai Devi, defendant no. 1, without his consent. The plaintiff claimed that defendant no. 1 Rupai Devi was holding the land as a trespasser, and that Bhramarbar Choudhuri was liable to be ejected from the holding. The main ground of defence was that the transfer in question was not real but a benami one which was made in order to save the holding from being sold in execution of a decree obtained against Bhramarbar. It was also contended on behalf of the defence that the tenancy was not chandna at all, but was an occupancy holding, which was transferable without the landlord's consent. The learned Munsif held that the tenancy was a chandna one and was not transferable without the landlord's consent. He further held that defendant no. 2 Bhramarbar ought not to be permitted to show that the transaction was benami since fraud had been effected in the execution case. He accordingly decreed the suit in favour of the plaintiff. In appeal, the learned Subordinate Judge held that the onus was upon the plaintiff to show that the tenancy was not transferable; and the plaintiff had failed to discharge the onus. He also held that defendant no. 2 was not estopped from oleadiner that the transfer was benami. He proceeded to consider the evidence on the point and found that the transfer was, in fact, benami. He accordingly reversed the decree of the learned Munsif and dismissed the suit.

In second appeal, Reuben, J. was of the view that the defendants were estopped from raising the plea of benami since they had practised fraud in the execution case and saved the chandna holding from being sold in satisfaction of the decree. The learned Judge further held that there was abandonment of the holding and that plaintiff was entitled to a decree for ejecting the defendants.

The questions which arise in this appeal are:

(1) Whether the defendants are estopped from pleading the benami nature of the sale deed; and

(2) whether the plaintiff is entitled to re-enter on the chandna holding merely on the ground that defendant no. 2 had transferred, it in the name of his wife without there being any abandonment or repudiation of the tenancy on his part.

On behalf of the appeilants Mr. K.D Chatterji made the submission that there was no fraudulent representation made to the plaintiff and there was no proof that the plaintiff acted upon any such representation or that he suffered any loss or damage. It was contended by the learned Counsel that no foundation has been laid for invoicing the doctrine of estoppel against the defendant Bhramarbar. There is great force in the argument of the learned Counsel, but the principle involved in this case is not the principle of estoppel which is enacted in section 115 of the Evidence Act. The principle involved is more important and far-reaching. It is the equitable principle that a Court ought not to interpose actively in favour of a person who is particeps criminis in an illegal or fraudulent transaction. In other words, the doctrine is that no person can claim any right or, remedy on the basis or ground that he has been a party to an illegal contract. For instance, a party cannot deliberately put his property out of his control for a fraudulent purpose and then, through the intervention of the Court, regain the same when the fraudulent purpose is accomplished. In Montefiore v. Montefiore, Lord Mansfield, when invited to decide whether a note without consideration given fraudulently to carry on a marriage treaty, shall be good against the drawer, observed that “no man shall set up his own iniquity as a defence, any more than as a cause of action.” In Brackenbury v. Brackenbury it was observed that if a deed was executed in order to enable a party, to contravene the provisions of an Act of Parliament, no suit in equity would lie to set aside the deed or recover the estate, and that the party executing it cannot be heard to allege his own fraudulent purpose. The party is estopped from confining the operation of his deed within the limits of his intended fraud. In a similar case, Doe dem Roberts v. Roberts a deed was sought to be avoided by the defendant, on the ground that it had been colourably executed merely to give an apparent qualification to kill game. The Court refused to deprive the form at conveyance of its effect. Bayley, J. said that by the production of the deed, the plaintiff established a prima facie title and they could not allow the defendant to be heard in a court of justice to say that his own deed is to be avoided by his own fraud. Holroyd, J. stated that a deed may be avoided on the ground of fraud but the objection must come from a person neither part nor privy to it for no man can allege his own fraud in order to invalidate his own deed. Similarly, in Phillpotts v. Phillpotts the executors of a person deceased sought to escape payment of an annuity granted by the testator, on the plea that it had been granted for the purpose of multiplying votes. This purpose was opposed to the law only if the grantor retained an interest in what he ostensibly conferred, and the Court refused to deprive the formal act of its regular effect in favour of those who had to rely for an excuse, on the illegal purpose of their own testator. All these cases demonstrate the principle that where the intended fraud is carried into effect, a Court of equity will not allow the true owner, to resume the individuality which he has once cast off in order to defraud others. Applying the principle to the facts of the present case, it is manifest that the defendants cannot; be permitted to plead that the kebala which Bhramarbar had executed was a benami transaction and did not convey real title to the transferee.

In support of his argument, Mr. K.D Chatterji relied upon Ramsarun Singh v. Mussamut Pran Peary in which there was a previous suit in which two of the defendants, in their answer, made a statement in respect of an alleged mortgage transaction with the object of defeating the plaintiff's claim, which was false. A foreclosure suit was afterwards brought by one of these defendants against the other founded on such alleged mortgage. It was held by the Judicial Committee that it was competent to the defendant to plead that the statement in the joint answer in the former suit was false and infended as a fraud on a third party, and that the admission in the answer did not amount to an estoppel as between the parties to the second suit. Lord Justice James said that it was open to a mortgagor to deny that the money the receipt of which was formally acknowledged under his hand and seal was actually advanced and that he could do so notwithstanding that he had made a contrary statement in a previous litigation with a third party; for a pleading by two defendants against the suit of another, plaintiff can never amount to an estoppel as between them. The decision is obviously correct, for the contemplated fraud was not carried out, there was a mere attempt to defraud and no innocent third party had been affected by the admission or representation. In the judgment of the High Court reported as Ramsarun Singh v. Mussamut Pran Pearee Justice Leavings states:

“To rule otherwise would be to cripple the action of the Court, and to make it the vehicle for enforcing fradulent deeds. In this case no innocent third party has been affected by the admission or representation; it exhibits solely an attempt by one party to a fraudulent deed to gain an advantage over the other, parties of the same deed, all equally participating in the fraud founded on an admission made by the latter in the deed, without any intention that the former should benefit by it to the prejudice of the latter.”

Mr. K.D Chatterji also referred to Sreemutty Debia Chowdhrain v. Bimola Soondaree Debia, in which the defendant Sreemutty Debia in a former suit made a statement that the kebala upon which the plaintiff relied was real and not benami. The lower appellate Court held that Sreemutty Debia cannot now turn round and say that the document was benami and that she was actual owner and possessor of Kasheenath's share. It was held by the High Court that there was no estoppel against the defendant and it was open to Sreemutty Debia to show the real nature of the transaction. At page 424 Sir Richard Couch observed that parties were not precluded from showing what was the real nature of the transaction, although it might have been entered into for the purpose of setting up against creditors an apparent ownership different from the real ownership. The principle so stated is unduly wide, but the actual decision in the case can be supported on the ground that the High Court proceeded on the footing that the fraudulent purpose of the benami transaction was not accomplished. This is clear from the circumstance that Sir Richard Couch relied upon the English case Symes v. Hughes in support of his decision. In the English case Lord Romilly, M.R, held that where an assignment of property to a trustee had been made for the purpose of defeating creditors, a suit might be maintained to recover back the property. He said, that where the purpose for which the assignment was given is not carried into execution, and nothing is done udder it, the mere intention to effect an illegal object did not deprive the assignor of his right to recover, the property from the assignee who had given no consideration for it. It is manifest that neither Sreemutty Debia Chowdhrain v. Bimola Soondaree Debia nor Ramsarun Singh v. Mussamut Pran Peary is of assistance to the appellant's case.

I next proceed to consider the submission of Mr. K.D Chatterji that the fraudulent purpose of the benami transaction was not in fact carried out and the defendants were not estopped from setting up the plea of benami. It was pointed out by the learned Counsel that step mother of defendant no. 2 had executed a decree for maintenance and in the execution proceeding defendant no. 1 claimed the holding on the basis of the sale deed. The executing court allowed the claim case in favour of defendant no. 1 and the execution proceeding was dismissed as being infructuous. Learned Counsel contended that there was in fact no fraud, because the decree-holder later on applied for fresh execution and her dues were fully satisfied. The argument was stressed that since there was no loss or injury caused to the decree-holder, the fraudulent purpose of the benami transaction was not carried out. In my opinion, the argument of the learned Counsel is not valid. It is true that the suit register (Ext. D) shows that the decree-holder applied for fresh execution on the 20th April, 1937, and the execution case was dismissed on full satisfaction on the 3rd January, 1938. But the decree which the step mother Tara Bewa had obtained was a decree for maintenance at the rate of Rs. 5 a month with effect from November, 1931. From the suit register (Ext. D) it appears that on two dates, 21st December, 1937, and 8th January, 1941, Tara Bewa had applied for execution of the decree of maintenance which had accrued subsequent to the 20th April, 1937, but the cases were dismissed for default. It is admitted by defendant no. 2 that he paid some maintenance to his step mother but something remained in arrears. He conceded that after he transferred, the chandna holding to defendant no. 1, he possessed no other properties. The maintenance decree of Tara Bewa imposes a recurrent liability on Bhramarbar. But in face of this admission it is clear that Tara Bewa cannot proceed against the chandna holding in case she attempts to execute the decree afresh. It is manifest that purpose of the benami transaction has been accomplished.

If the illegal purpose of the contract is not fulfilled the law thinks fit to allow a locus paenitentiae to one or both of the parties to the contract. In such a case it is considered that the ends of justice will best be met by allowing the party to repent before it is too late and to prevent the completion of the illegal purpose. But where the illegal purpose has been wholly or partially performed, the law allows no locus paenitentiae. Mr. K.D Chatterji relied upon T.P Ptherpermal Chetty v. R. Muniandi Servai but the ratio of that case does not assist the appellants. In that case a suit was brought in 1901 to recover land from the appellant but it appeared that the plaintiff's predecessor in title had in 1895 collusively executed a benami deed of sale thereof to the defendant's predecessor in order to defeat the claim of a prior equitable mortgagee who at once sued the parties to the said benami deed and obtained satisfaction of his claim with costs. It was held by the Judicial Committee that the purpose of the fraudulent conveyance having been defeated, the plaintiff was entitled to a decree and the defendant could not rely upon the contemplated fraud as an answer to the action. The facts of the present case are different, for, as I have already pointed out, the purpose of the fraudulent conveyance was accomplished and the defendants succeeded in saving the chandna holding from being taken in execution of the decree obtained by Tara Bewa.

In my opinion, the present case falls within the ambit of the principle laid down in Kearloy v. Thomson in which the defendants were solicitors to the petitioning creditor, in certain bankruptcy proceedings, and had incurred costs which were to be paid out of the estate. The plaintiff, a friend of the bankrupt, offered to pay to the defendants a sum of money for these costs, which had not been paid owing to want of assets, on their undertaking not to appear at the public examination of the bankrupt, and not to oppose his order of discharge. The defendants, with the consent of their client, agreed to this, and received the money. They did not appear at the public examination of the bankrupt, and, before any application for his discharge had been made, the plaintiff brought an action to recover back the money from the defendants. It was held by the Court of Appeal that though the contract was illegal the partial performance of it prevented the plaintiff from recovering back the money paid under it. At page 746 Lord Justice Fry states:

“But even assuming the exception to exist, does it apply to the present case? What is the condition of things if the illegal purpose has been carried into effect in a material part, but remains unperformed in another material part? As I have already pointed out in the present case, the contract was that the defendants should not appear at the public examination of the bankrupt or at the application for an order of discharge. It was performed as regards the first; but the other application has not yet been made. Can it be contended that, if the illegal contract has been partly carried into effect and partly remains unperformed, the money can still be recovered? In my judgment it cannot be so contended with success. Let me put are illustration of the doctrine Contended for; which was that partial performance did not prevent the recovery of the money. Suppose a payment of £100 by A to B on a contract that the latter shall murder C and D. He has murdered C; but not D. Can the money be recovered back? In my opinion it cannot be. I think that case illustrates and determines the present one”

Applying the principle to the present case I hold that the defendants cannot be permitted to set up the plea that the kebala was a benami transaction and that the finding of Reuben, J. on this part of the case is right.

I propose next to deal with the question whether the plaintiff has a right to obtain khas possession of the chandna holding merely because defendant no. 2 had sold it to defendant no. 1 without his consent. Mr. K.D Chatterji panted out that the learned Subordinate Judge has found that Bhramarbar was in actual possession of the holding and that he had been paying rent to the landlord. If was contended by the learned Counsel that upon the evidence it was impossible to hold that there was abandonment of the holding on the part of Bhramarbar or that there was repudiation of the relationship of landlord and tenant. The argument of the learned Counsel is well-founded. There are authorities to support the view that something more, than mere transfer of the holding on the part of the tenant is necessary to forfeit the tenancy and give the landlord the right of re-entry, or a cause of action for claim to possession. In Monmatha Kumar Ray v. Josada Lal Podder it was observed by Newbould and Rankin, JJ.:

“There is a considerable amount of law dealing with the question of the right of the landlord to re-enter the land of a non-transferable occupancy holding after its transfer by the tenant, but in no case has it been held that the mere transfer, apart from any other consideration gives the landlord a right to re-enter when the tenant transferor, actually remains in occupation of the land.”

In Romesh Chandra Mitra v. Daiba Charan Das an occupancy holding had been sold in execution of a money decree as well as a mortgage decree and thereafter the raiyat took a sub-lease from the transferee and remained in possession of the home-stead and cultivated some plots of the land on the holding. It was held by the High Court that the landlord cannot sue either the tenant or the transferee for khas possession since there was in law no abandonment or repudiation of the tenancy by the tenant. Rankin, J. referred to the first proposition laid down by the Full Bench in Dayamayi's case in these terms:

“Where the transfer is a sale of the whole holding, the landlord in the absence of his consent, is ordinarily entitled to enter on the holding…….”

It was pointed out by Rankin, J. that the circumstance that the tenant was in possession of the homestead and as well cultivated a part of the holding is a consideration which takes the case out of the qualification intended by the word “ordinarily” in the first proposition laid down in Dayamayi's case. In another case, Srimati Separjan alias Siporunnessa Bibi v. Ramdeb Rai a tenant having a non-transferable right sold such right to a third person and obtained sub-lease from the purchaser, remained in possession of the land and cultivated it. The landlord brought a suit for khas possession, but it was held by the High Court that the landlord is not entitled to succeed inasmuch as there was no abandonment and no repudiation by the tenant of his relationship with the landlord. A similar view was adopted in the Patna case Ganpat Lal v. Wazira Singh*. There was a court sale and delivery of possession to the auction-purchaser, but the raiyat actually remained on the land in disregard of the delivery of possession and asserted his tenancy. It was held by a Division Bench that there was no abandonment by the raiyat and the landlord was not entitled to enter on the land as from the date of formal delivery of possession and time could not begin to run against him under the law of limitation until the person whom he could designate a trespasser was actually cultivating the land of the tenancy asserting a right adverse to the tenant.

Applying the ratio of these authorities, if is clear in the present case that there was no abandonment of the holding on the part of defendant no. 2, nor was there any repudiation or relinquishment of relationship of landlord and tenant. It follows, therefore, that the plaintiff is not entitled to obtain a decree for khas possession of the chandna holding against the defendants.

For the reasons which I have expressed, I think that the Appeal under the Letters Patent must be allowed and the suit brought by the plaintiff should be dismissed with costs.

Das, J.:— This case has caused me some anxiety. The argument before us centred mainly round the question whether defendant no. 2 debarred himself from taking up the position that the transaction which he had entered into in favour of his wife was fictitious. The rule that the Court will not actively interpose in favour of a man who is particeps criminis in a fraudulent transaction admits of exceptions, and where both parties are equally offenders against the law, the maxim potior est conditio possidentis prevails, not because the defendant is more favoured, where both are equally criminal, but because on the principle of public policy the Court will not assist a plaintiff, who has paid over money or handed over property in pursuance of any illegal or immoral contract, to recover it back (Kerr on Fraud and Mistake, Sixth Edition, page 544). In the case before us, the plaintiff was not particeps criminis, nor was he an offender against the law. On the same ground of public policy defendant no. 2, Bhramarbar Choudhuri, should, I think, be debarred from taking up the position that he had made a fictitious transfer in favour of his wife in order to defraud a creditor, which fraud, it appears, had at least partially succeeded.

The question whether in the circumstances of this case there has been an abandonment or a repudiation of the tenancy by Bhramarbar Choudhuri is not a very easy question to answer. If Bhramarbar Choudhuri is to be held to the transfer he had made and cannot be allowed to resile from it, it seems somewhat anomalous to hold that he still continues to be the tenant of the plaintiff-respondent. Unlike other cases, this is not a case in which a later tenancy or a sub-tenancy had been created in favour of the transferor. It is anomalous that the transferor, when bound by the transfer, is held still to be a tenant of the landlord: this may mean that he is allowed to relieve himself of one of the consequences of the transfer, even though he cannot get behind the transfer itself.

No decision directly and exactly in point has been brought to our notice. The plaintiff-respondent of also seems to be trying to take advantage of his tenant's fraud, though he did not himself suffer any loss or damage by the transfer and continued to receive rent from the tenant, presumably in ignorance of the transfer.

In the circumstances mentioned above, I am not prepared to differ from my learned brother, particularly when there are a number of decisions which have held, though in somewhat different circumstances, that a mere transfer, does not give the landlord the right of re-entry.

Appeal allowed.

K.D