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TMI Blog2014 (3) TMI 1205X X X X Extracts X X X X X X X X Extracts X X X X ..... nt transferred the suit property to the plaintiffs for a total consideration of Rs. 1,65,00,000/-. The plaintiffs claim that the respective shares of the three plaintiffs in the suit property is as follows: (i.) Plaintiff No. 1's share being 66.66% (ii.) Plaintiff No. 2;s share being 23.34% (iii.) Plaintiff No. 3's share being 10% 2. The sale deed was registered as document No. 13,180 in Book No. I Volume No. 6,205 at pages 64-74 on 02.12.2011 in the office of the Sub-Registrar No. IX, New Delhi. The plaintiffs state that their right of possession was recognized in the said sale deed, which acknowledge that "the vacant and physical possession of the abovementioned property under sale has been given to the Vendees by the Vendor, who have occupied the same. 3. The case of the plaintiffs is that despite the receipt of the entire consideration and execution of the sale deed, the defendant has failed to handover the physical vacant possession of the suit property to the plaintiffs - citing personal reasons like ill-health of the defendant's wife, and urgent work commitments. The plaintiffs state that they did not press for immediate possession of the suit property, believing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of documents to the plaintiffs. The defendant states that the loan was interest bearing @ 2% per month, which was payable in cash every month, against which the defendant could not claim any receipt. The defendant states that under the loan transaction, the plaintiffs had also agreed to execute a fresh sale deed in favour of the defendant, as & when the entire money is paid along with: interest @ 2% per month; expenses incurred while registering the sale deeds; court fees, etc. to the plaintiffs by the defendant. Consequently, the defendant does not deny the factum of voluntary execution and registration of the instrument of sale deed in respect of the suit property, as claimed by the plaintiffs, but denies that the said instrument was executed to sell the suit property, as the instrument was executed to secure the "loan‟ taken from the plaintiffs by the defendant. 7. The defence of the defendant is that - the fact that possession was not claimed by the plaintiffs till 28.04.2012, even though the sale deed was executed and registered on 02.12.2011, shows that the intention of the parties was not to transfer the suit property to the plaintiffs by way of sale. The defendant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f relief of possession forthwith against the defendant on the basis of their title to the suit property. 12. Mr. Kaul submits that the defence set up by the defendant is that of a loan transaction between the parties. He submits that no document in support of the said defence has been produced by the defendant. The defendant has claimed that the registered sale deed dated 01.11.2011 was executed by the defendant in favour of the plaintiffs with a view to secure the so-called loan taken by the defendant from the plaintiffs. Mr. Kaul submits that such a defence is not tenable, and is barred under Sections 91 & 92 of the Evidence Act, 1872 in the face of the registered instrument of sale, admittedly executed by the defendant in favour of the plaintiffs. A written document cannot be countenanced by any oral evidence. Once a document has been admitted, Sections 91 & 92 of the Evidence Act come into play and any oral evidence to prove to the contrary cannot be accepted. Mr. Kaul submits that the defence raised by the defendant, on the face of it, is of an illegal transaction hit by Section 40(A)(3) of the Income Tax, 1961 and the same cannot be accepted as a defence in the eyes of law. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clause in the sale deed, in this respect: "That in consideration of Rs. 1,65,00,000/- (Rupees One Crore and Sixty Five Lakhs only) which has been received previously by the Vendor from the Vendees as a full and final settlement, as per details given below: 1. Received through cheque as No. 373237 dated 24.02.2011 Rs. 3,50,000/- 2. Received through cheque as No. 373238 dated 25.02.2011 Rs. 3,50,000/- 3. Received through cheque as No. 359182 dated 24.02.2011 Rs. 3,00,000/- 4. Received through cheque as No. 373252 dated 13.10.2011 Rs. 3,50,000/- 5. Received through cheque as No. 437410 dated 15.10.2011 Rs. 5,60,000/- 6. Received through cheque as No.437411 dated 16.10.2011 Rs. 9,00,000/- 7. Received through cheque as No. 437412 dated 17.10.2011 Rs. 9,00,000/- 8. Received through cheque as No. 437413 dated 18.10.2011 Rs. 9,00,000/- 9. Received through cheque as No. 437414 dated 19.10.2011 Rs. 9,00,000/- 10. Received through cheque as No. 437415 dated 20.10.2011 Rs. 9,00,000/- 11. Received through cheque as No. 437416 dated 21.10.2011 Rs. 9,00,000/- 12. Received through cheque as No. 437417 dated 22.10.2011 Rs. 9,00,000/- 13. Received through cheq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 19 of the Contract Act) 17. Mr. Mittal submits that the plaintiffs made a promise to the defendant that they shall not misuse the aforesaid sale deed and shall execute a reverse sale deed in favour of the defendant on repayment of the loan amount. He submits that upon the filing of the present suit, the fraudulent intentions of the plaintiffs‟, which they entertained right from the beginning, got exposed, thus entitling the defendant to proffer the counter-claim for cancellation of the sale deed. 18. Mr. Mittal submits that bar of Section 91 & 92 of the Indian Evidence Act is not applicable in the present case, since the contentions raised in the counter claim of the defendant are covered under Provisos 1 to 3 to Section 92, and the explanation 3 to Section 91. 19. Mr. Mittal has placed reliance on several decisions in support of his submissions, which shall be referred to a little later. Mr. Mittal submits that the defendant is only seeking to prove the actual transaction between the parties. He, thus, seeks dismissal of both the applications of the plaintiffs, as aforesaid. 20. In my view, the decision of both the aforesaid applications depends upon the determinati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , adding to, or subtracting from, its terms; Provision (1) - Any fact may be proved which would invalidate any document, or which would entitle any person to any decree or order relating thereto; such as fraud, intimidation, illegality, want of due execution, want of capacity in any contracting party, 76[want or failure] of consideration, or mistake in fact or law. Proviso (2) - The existence of any separate oral agreement as to any matter on which a document is silent, and which is not inconsistent with its terms, may be proved. In considering whether or not this proviso applies, the Court shall have regard to the degree of formality of the document. Proviso (3). - The existence of any separate oral agreement, constituting a condition precedent to the attaching of any obligation under any such contract, grant or disposition of property, may be proved. Proviso (4). - The existence of any distinct subsequent oral agreement to rescind or modify any such contract, grant or disposition of property, may be proved, except in cases in which such contract grant or disposition of property is by law required to be in writing, or has been registered according to the law in force for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the plaintiffs stands paid in the manner described and "nothing remains due out of the sale price". The sale deed also records that "the vendor hereby absolutely assigns, conveys and transfers to the vendees all rights of ownership, titles and of interests in the abovementioned property under sale hereby conveyed". It also provides: "The Vendees shall hereinafter hold use, enjoy as they like and to sell, mortgage, lien, let-out or make additions/alterations/ re-construct with all construction for construction of further floors in the same as their own property without any hindrance, claim or demand whatsoever from the Vendor". [emphasis supplied ] 24. Therefore, the terms of the sale deed clearly show that the nature of the transaction that the said instrument records is an absolute conveyance of property i.e. the sale of the suit property. By no stretch of reasoning it can be described as a transaction of loan, coupled with a transaction to create a security for repayment of loan with interest and costs and subsequent retransfer of the suit property by the plaintiffs to the defendant. 25. The terms on which the suit property was conveyed by the defendant to the plaintiffs h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of property" which have been reduced to the form of the document. For instance, if the age or address, or paternity of a party is recorded in an instrument, it shall be open to the parties to lead evidence to establish that the same is not correctly recorded, or that the same is, in fact, different from what the instrument records. However, this explanation cannot be invoked to disprove the "terms of a contract, or of a grant, or of any other disposition of property". 27. Section 92 of the Evidence Act, inter alia, provides that where the terms of a grant or other disposition of property have been proved according to Section 91 - and in this case the execution and registration of the instrument of sale is not disputed by the defendant, no evidence of any oral agreement, or statement shall be admitted, as between the parties to such instrument, for the purpose of contracting, varying, adding to or subtracting from its terms. 28. By setting up the defence as noticed hereinabove, the defendant is seeking to do precisely this. The defendant is setting up a defence/ case which clearly contradicts and varies the terms of the duly executed and registered instrument of sale. The defe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aud - with dates and items, in the pleading. The pleadings of the defendant, in the written statement / counter claim do not even make out a case of fraud. In any event, the fraud, intimidation, illegality, etc referred to in proviso 1 to Section 92 relates to the execution of the instrument/ document. It is not the defendant's case that when he executed the sale deed, he did not know that it is a sale deed that he was executing. It is not the defendant's case that he is unlettered or illiterate or that he did not read, or could not read the instrument in question. He does not claim that the sale deed was executed in an intoxicated or unsound state, or under duress or coercion exercised by the plaintiffs, or anyone else. The defendant knew the fact that he was executing an instrument of sale. When he has executed the sale deed in question, it is not open to the defendant to claim that the instrument of sale is hit by fraud, because, according to the defendant, the intention or understanding of the parties was to create a security in favour of the plaintiffs for the alleged loan granted to the defendant. The spirit and purpose of enacting Section 91 and 92 of the Indian Evidence Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... writing itself must be produced before the court or its absence accounted for before testimony to its contents is admitted. 17. It is likewise a general and most inflexible rule that wherever written instruments are appointed, either by the requirement of law, or by the contract of the parties, to be the repositories and memorials of truth, any other evidence is excluded from being used either as a substitute for such instruments, or to contradict or alter them. This is a matter both of principle and policy. It is of principle because such instruments are in their own nature and origin, entitled to a much higher degree of credit than parol evidence. It is of policy because it would be attended with great mischief if those instruments, upon which men's rights depended, were liable to be impeached by loose collateral evidence. (See Starkie on Evidence, p. 648.)". (emphasis supplied) 34. Reliance has been placed by the defendant on para 22 of the judgment in Roop Kumar (supra). In my view, the same is of no avail. The Supreme Court in para 22 of Roop Kumar (supra) observed: "22. This Court in Gangabai v. Chhabubai [(1982) 1 SCC 4 : AIR 1982 SC 20] and Ishwar Dass Jain v. So ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transaction be said to be evident either directly or indirectly". 38. The court also dealt with the issue whether a party can give oral evidence concerning the intention of the parties at the time of the execution of a document, which is not reflected in such a document. In this context, Roop Kumar (supra) was relied upon. The court rejected the defence set up by the defendant which was contrary to the terms of the registered instruments. In the light of the above discussion, I reject the reliance placed by the defendant on the Ist proviso to Section 92 of the Evidence Act. 39. Proviso 2 to Section 92 permits the proof of execution of a separate oral agreement "as to any matter on which the document is silent", and which is not inconsistent with its terms. The defence/ case of the defendant- that there was a separate oral agreement of loan with security; of payment of interest in cash without receipt; of reconveyance of the suit property by the plaintiffs to the defendant-on the terms narrated by the defendant, cannot be set up, since the said case/ defence relates to matters on which the document is not silent. Rather, it is "speaking", and such defence is inconsistent with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sale deed. The property was leased on the same day to the defendant/ appellant. On account of default in payment of rent, the plaintiff/ respondent initiated a suit for recovery of rent. One of the defences taken by the defendant/appellant was that ―the sale deed was in fact a security for the loan advanced by the respondent to the defendant/appellant and, therefore, there is no relationship of landlord and tenant between the parties". The Supreme Court rejected this argument by observing that: "This argument is noticed only to be rejected. It is not disputed that the sale deed is a registered document and, therefore, no oral evidence could be adduced to show that no title passed on to the respondent under the sale deed". This judgment applies on all fours to the present case. 44. In Krishi Utpadan Mandi Samiti, Sahaswan, District Badaun through Its Secretary Vs. Bipin Kumar & Another, (2004) 2 SCC 283 - a case relating to land acquisition, the respondent disputed the reliance placed by the land acquisition officer on the rate/price disclosed in a sale deed by which the respondent purchased a portion of the acquired land. While rejecting this submission of the respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o.1 without receiving any consideration therefor. He also issued a blank cheque from the account of plaintiff No.2. The plaintiff filed a suit to seek cancellation of documents executed and got registered by him, recovery of Rs.25 lacs and permanent injunction to restrain the defendants from selling or alienating their properties. 47. After assessing the documents relied upon by the plaintiff, the court posed the question - whether the court should allow its time to be wasted when the plaintiff had not produced material documents and had not given any explanation for their non-production. The court answered the said question in the negative. The court observed that, "The Court will not allow its time to be wasted for trial of suits which are bound to abort (reference in this regard may be made to T. Arvindandam Vs. T.V. Satyapal AIR 1997 SC 2421, Liverpool & London S.P. and I. Association Ltd. Vs. M.V. Sea Success I (2004) 9 SCC 512 & ITC Ltd. Vs. Debts Recovery Appellate Tribunal (1998) 2 SCC 70.‖ 48. The monetary claim of Rs.25 lacs made by the plaintiff was also rejected as being barred on the principles of in pari delicto. The court observed that it would not allow its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccounts for evading payment of income tax and sales tax. The Lower court reported the matter to the Taxation Authority. The High Court held that the Courts should have refused to entertain the suit on the ground of public policy, as it involved directing the recovery of an amount found to be due to either party as a share of the profits which had been deliberately concealed by the parties from the books of account in order to evade the payment of taxes. It was held that no Court can countenance a deliberate evasion of tax laws of the country and to lend the aid of the court for recovering an amount which had been deliberately kept concealed by the parties in order to evade payment of taxes due thereon. It was further held that if the courts were to do so, it would amount to aiding and abetting evasion of the laws by the court itself. It was further held that since the object of the parties was found to be that the profits will be earned in such a way or retained in such a manner as to evade the payment of taxes which was forbidden by law and which defeats the provision of the tax laws, therefore the object of the agreement was forbidden by law and is opposed to public policy. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Such intention can be gathered by intrinsic evidence, namely, from the averments in the sale deed itself or by other attending circumstances subject, of course, to the provisions of Section 92 of the Evidence Act, 1872." 51. The intrinsic evidence on which the defendant seeks to place reliance is, firstly, the fact that the sale consideration was paid in installments spread between February 2011 and October 2011 by 24 different cheques. Secondly, the defendant claims that though the sale deed itself records the delivery of possession of the suit property to the plaintiff, as a matter of fact, the same was not so delivered. Thirdly, the defendant claims that the plaintiff waited for about five months to claim possession after the execution and registration of the sale deed (the sale deed was registered on 02.12.2011 and the plaintiff claims to have taken possession for a day on 28.04.2012), which shows that the intention of the parties was not to transfer the suit property to the plaintiff by way of a sale. Fourthly, the defendant claims that the suit property has not been separated as EC-4 and EC-5 share a common driveway and lounge. 52. The defendant is barred in law by virtue o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of sale, the possession was not liable to be delivered. Be that as it may, even if were to be accepted that possession was never delivered to the plaintiff, that fact would not deprive the plaintiff to claim ownership on the basis of their title derived from the sale deed, and to claim possession of the suit property from the defendant, since the defendant has not set up any defence to claim possessory rights in the suit property. 54. The non delivery of possession by the defendant to the plaintiffs does not by itself, or cumulatively with the other factors pointed out by the defendant, lead to the conclusion that the transaction between the parties was not a sale of the suit property, but was a mere loan transaction. So also the fact that the plaintiffs waited for about five months to claim possession of the suit property from the defendant has no bearing on the plaintiffs‟ title to the suit property, or their right to claim possession. 55. In Sanjay Gupta v. Cottage Industries Exposition Ltd., 2008 (102) DRJ 304, I had the occasion to deal with sections 91 and 92 of the Evidence Act. The parties had entered into a registered lease deed. The plaintiff claimed that the le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red document can be altered, rescinded or varied only by subsequent registered document and not otherwise. If the oral arrangement is allowed to be substantiated by parol evidence it would mean re-writing of the registered document which is not permissible". 56. Mr. Mittal has placed before this court merely a head note of a decision of the Andhra Pradesh High Court in Yerram Krishna Rao & Ors. V. Muttamalla Narasamma & Anr., AIR 2009 NOC 580 (A.P). From the head note, it appears that the plaintiff claimed to have executed the sale deed as security for loan availed of by her. The plaintiff was in possession of the property. The court held that in such a case, neither section 91 nor section 92 would disable the plaintiff from adducing oral evidence to explain the transaction covered under the sale deed. 57. Firstly, without the complete report of the judgment, it is difficult for this court to appreciate in what context the same has been rendered. Secondly, oral evidence can be lead only on the basis of the pleadings. The pleading of the defendant of the so-called loan transaction is highly deficient, apart from being patently contradictory to the terms of the registered instrumen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The defendant is precluded from contending that the real transaction between the parties was a loan transaction as the sale deed in question stares in the fact of the defendant while raising such a defence. Moreover, there is no ambiguity in the language employed by the parties in the sale deed. The same is absolutely clear and explicit. 61. Reliance placed on Tulsi and Others Vs. Chandrika Prasad and Others, (2006) 8 SCC 322, by learned counsel for the defendant is also of no avail. In this case the document was described as a sale deed. However, the terms contained in the deed provided that if the entire consideration is repaid by a particular date, the purchaser will reconvey the property and deliver possession thereof. The Supreme Court held that the sale would become absolute only when the transferee failed to pay the amount within the stipulated period. The conduct of the parties, namely that the transferors did not get their names mutated and that the stamp duty was paid by the transferor and not by the transferee, as in a sale, were also taken note of by the Supreme Court to conclude that the transaction was a mortgage with conditional sale. The aforesaid conditions found ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation on such facts seeking leave to defend in a suit under Order 37 of the CPC, this Court would have had to hold that the defendant has no defence and the pleas set up are illusory and moonshine.‖ 64. In Sharex Acting Through Vinod Kumar Chadha Vs. Sudershan Suri, 170 (2010) DLT 600, the learned Single Judge rejected the plea of the appellant on the premise that the said plea was belied by the terms of the lease deed, the execution of which had been unequivocally admitted by the appellant. Reliance was placed on Parivar Seva Sansthan v. Dr (Mrs.) Veena Kalra & Ors., 2000 (54) DRJ (DB). In para 20, the Court, inter alia, held as follows: "20. To conclude, in the instant case the execution of the lease deed has been unequivocally admitted by the appellant. Once the execution of the document has been admitted, Sections 91 and 92 of the Evidence Act, come into play. Section 91 lays down that when the terms of a contract or of any other disposition of property have been reduced to the form of a document, no evidence shall be given in proof of the terms of such contract or other disposition of property, except the document itself. Section 92 further lays down that when the te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... without determining the other questions. This provision is discretionary, which has to be exercised on well established principles. Admission must be clear and unequivocal; it must be taken as a whole and it is not permissible to rely on a part of the admission ignoring the other part; even a constructive admission firmly made can be made the basis. Any plea raised against the contents of the documents only for delaying trial being barred by the section 91 and 92 of Evidence Act or other statutory provisions, can be ignored. These principles are well settled by catena of decisions. Reference in this regard be made to the decisions in Dudh Nath Pandey (dead by L.R's) Vs. Suresh Chandra Bhattasali (dead by L.R's) MANU/SC/0382/1986 : AIR1986SC1509 ; Atma Ram Properties Pvt. Ltd. Vs Air India MANU/DE/1151/1996 : 65(1997)DLT533 ; Surjit Sachdev Vs. Kazakhstan Investment Services Pvt. Ltd. 1997 2 AD (Del) 518; Abdul Hamid Vs. Charanjit Lal & Ors. 1998 2 DLT 476 and Lakshmikant Shreekant Vs. M N Dastur & Co. MANU/DE/0524/1998 : 71(1998)DLT564 ." 67. On the aspect - what constitutes a clear and unequivocal demand, the Division Bench observed as follows: "10. ..... ..... ..... . ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also been given the discretion to pass such order as it may think fit as an alternative . This is also the position under Order 8 Rule 10 CPC where the court can either pronounce Judgment against the defendant or pass such order as it may think fit." 68. In Express Towers P. Ltd. & Another Vs. Mohan Singh & Others, 2007 (97) DRJ 687 (DB), the Division Bench held that a decree can be passed by the court under Order 12 Rule 6 CPC when admissions are clear and unambiguous and no other interpretation is possible. The power to pass a decree on admission is discretionary, and not mandatory under Order 12 Rule 6 CPC. The Court observed that it may not be safe and correct to pass a judgement under Order XII Rule 6 CPC when a case involves disputed questions of fact and law which require adjudication and decision. Even when a party has made an admission, the Court need not act on the same. There can be no quarrel with the aforesaid proposition laid down in para 10 of Pariva Seva Sansthan (supra) and Express Towers P. Ltd. (supra). However, where the relief sought by the plaintiff is squarely made out in view of unstatable/ untenable defence, it is equally well-settled, that the Court shall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iced above, no other cause of action or basis for the reliefs sought in the counter claim has been disclosed. It is clear that no cause of action has arisen in favour of the defendant to seek the cancellation of the sale deed dated 01.11.2011 registered on 02.12.2011, in respect of the suit property, or to seek the execution of a fresh sale deed in favour of the defendant by the plaintiff. No cause of action has arisen to require the plaintiffs to return all the original chain of documents in respect of the suit property to the defendant under any circumstance. 74. In Sopan Sukhdeo Sable and Others Vs. Assistant Charity Commissioner and Others, (2004) 3 SCC 137, the Supreme Court observed - by placing reliance on I.T.C. Ltd. Vs. Debts Recovery Appellate Tribunal, (1998) 2 SCC 70, that the basic question to be decided while dealing with an application filed under Order VII Rule 11 CPC is whether a real cause of action has been set out in the plaint or something partially illusionary has been stated with a view to get out of Order VII Rule 11 CPC of the Court. The Trial Court must remember that if on a meaningful - and not formal, reading of the plaint it is manifestly, vexatious an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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