Judgement FACTS : -This is an appeal arising from a suit for a declaration that certain so called oral and written transfers made by her in favour of her brother defendant 1 were void, and if necessary for obtaining actual possession of the properties conveyed by the deeds to him. In regard to two other properties, the plaintiff had also asked for their possession, on the footing that though the properties had been purchased in the name of defendant 1 they were actually purchased by her from her own moneys, and the sale deed was taken in the name of defendant 1 benami.Finally, the plaintiff claimed by her suit for recovery from defendant 1 of a kanthi (necklace) which she alleged had been lent to defendant 1 at the time of the marriage of his daughter defendant 3 or its price.Defendant 2 was the son of defendant 1, and defendants 4 and 5 were the plaintiffs husbands nephews.It was not in dispute that the properties in suit which the plaintiff contended were purchased by her benami in the name of defendant 1 either belonged to the plaintiffs husband, or were acquired by her after his death from the income of the estate she inherited from him. The plaintiff conveyed out of these properties lands at Limla and Kavas to defendant 1 by a sale deed dated 10-10-1944, for a consideration of Rs.3,999.Two other lands at Kavas were transferred at the behest of the plaintiff in the name of defendant 1 an 12-10-1944, the mutations showing that the consideration of the two transfers were the sums of Rs.1,575 and Rs.200 respectively. A third piece of land was transferred by the plaintiff to defendant 2 gratis on 30-1-1947, by giving information to the village officers upon which an entry was made by them in the record of rights.The plaintiff contended that when her husband died, he had got no debts, and left a flourishing business which was carried on by her with the help of defendant 1. Defendant 1, however, persuaded her to convey her husbands properties to him. In the plaint she said that she conveyed these properties in order that defendants 4 and 5 should not harass defendant 1 after her death.
Defendant 1, however, persuaded her to convey her husbands properties to him. In the plaint she said that she conveyed these properties in order that defendants 4 and 5 should not harass defendant 1 after her death. At the trial, however, she said that she conveyed these properties to defendant 1, because she wanted to save harassment of herself.The plaintiff said that even though she had executed a sale deed in favour of defendant 1 she had received no consideration, that there was an agreement between her and defendant 1 that the lands were to remain with her, and the sale deed was not to be acted upon against her.With regard to the properties which had been transferred by her without a sale deed to defendant 1, she said she had actually not received any consideration for any of the transfers and that in any case the mutations were not sufficient for transferring the title to defendant 1.The contesting defendants were defendants 1 to 3. Defendants 4 and 5 seem to have taken the view that if the plaintiff succeeded in her suit, it would be better for them, and did not contest it.Defendants 1 to 3 contended that the plaintiff had transferred her properties in order to pay off the debts due by her husband, and it was not true that the properties other than the one which was given away were transferred without any consideration.So far as the kanthi which the plaintiff alleged had been given by her to defendant 1, he denied its receipt. He also contended that it was not true that the plaintiff had acquired from her own funds but in his name the remaining two properties.The learned trial Judge held that the plaintiff had proved her case that she had transferred the properties benami to defendant No.1 and without any consideration; that even though she had executed a sale deed in regard to them and gave a vardi to the village officers to transfer the properties to them, the agreement was that those transfers were not to be enforced against her.He held, further, that the plaintiff had proved that she had purchased benami the two pieces of lands in the name of defendant 1 and had given to him the kanthi at the time of defendant 3s marriage.
He gave the plaintiff a decree for possession of the properties transferred by the plaintiff to defendants 1 and 2 and the two properties mentioned above which the plaintiff alleged she had purchased in defendant 1s name.He also gave her a decree for the price of the kanthi and for mesne profits from the date of the suit. He further restrained defendant 1 from interfering with the plaintiffs possession of any of the pieces of land. After declaring that the transfers were fictitious and void, he gave the plaintiffs a decree for whatsoever lands were in the possession of defendant 1 and restrained defendant 1 from interfering with the plaintiffs possession of the remaining properties.Defendants 1 to 3 appealed to the High Court.JUDGMENT : -(His Lordship after narrating the facts proceeded). The first point which is made by the learned advocate, who appears on behalf of the appellants, is that oral evidence was not admissible in order to show that the sale deed of October, 1944, was a nominal transaction and that the agreement between the parties was that it was not to be enforced against the plaintiff. Now, it appears to me that this evidence was admissible in order to show that in spite of the fact that the plaintiff had executed a sale deed in favour of defendant 1, there was as a matter of fact no contract between the parties, and consequently no transfers either. Section 92, Evidence Act has application when the terms of a contract, grant or other disposition of property among other things have been proved in accordance with S.91. Section 91 makes inadmissible oral evidence of the terms of a contract, or of a grant, or of any other disposition of property which have been reduced to the form of a document. Section 92 provides that when the terms are proved by the document, no evidence of any oral agreement or statement shall be admitted, as between the parties, to contradict or vary them. Then there are provisos to both Ss.91 and 92; but it is obvious that neither section has got application unless in the first instance there is a contract, or a grant, or any other disposition of property. That was what their Lordships of the Privy Council pointed out in - Tyagaraja Mudaliar v. Vedathanni, AIR 1936 PC 70 (A).
Then there are provisos to both Ss.91 and 92; but it is obvious that neither section has got application unless in the first instance there is a contract, or a grant, or any other disposition of property. That was what their Lordships of the Privy Council pointed out in - Tyagaraja Mudaliar v. Vedathanni, AIR 1936 PC 70 (A). Now, the plaintiffs case in this case was that as a matter of fact there was no contract nor any sale by her. The transaction was a benami transaction. In order to explain the necessity of going into the transaction, she said that the idea was that her husbands nephews, who were entitled to inherit her husbands properties upon her death, and who had got a right to challenge anything which she might have done in regard to these properties even during her lifetime, should not harass her, according to her deposition, and her brother after her death, in accordance with the plaint. But the fact remains that it was the plaintiffs case that as a matter of fact there was no contract for sale, nor was there any sale. Now inasmuch as the evidence which is referred to in Ss.91 and 92 is to be excluded upon the proof of a contract, grant or disposition of property, the evidence which is intended to show that there was no grant, contract or disposition of property does not offend against the provisions of either section. Of course, we are concerned in this case with our own Act, and inasmuch as the law in England and the law in India is not always the same, English authorities are not a safe guide in determining the question of admissibility under the Indian Evidence Act; but the case which is mentioned by their Lordships of the Privy Council in AIR 1936 PC 70 (A) of - Pym v. Cambell, (1856) 6 El and Bl 370 (B), shows that the law in England is the same. Erle J., who gave the judgment in that case, dealt with the question as follows: "...The point made is that this is a written agreement, absolute on the face of it, and that evidence was admitted to show it was conditional: and if that had been so it would have been wrong.
Erle J., who gave the judgment in that case, dealt with the question as follows: "...The point made is that this is a written agreement, absolute on the face of it, and that evidence was admitted to show it was conditional: and if that had been so it would have been wrong. But I am of opinion that the evidence showed that in fact there was never any agreement at all. The production of a paper purporting to be an agreement by a party, with his signature attached, affords a strong presumption that it is his written agreement; and, if in fact he did sign the paper animo contrahendi, the terms contained in it are conclusive, and cannot be varied by parol evidence...... but, if it be proved that in fact the paper was signed with the express intention that it should not be an agreement, the other party cannot fix it as an agreement upon those so signing. The distinction in point of law is that evidence to vary the terms of an agreement in writing is not admissible, but evidence to show that there is not an agreement at all is admissible." 2. I am pressed however very much on behalf of the appellants by the case of their Lordships of the Privy Council arising from another jurisdiction reported in - Tsang Chuen v. Li Po Kwai, AIR 1932 PC 255 (C). In that case, one Li Po Kwai had assigned certain leasehold premises in Hong Kong to himself and his son as joint tenants. The deed stated that the property had been sold to them for 16,000 dollars, the receipt of which had been acknowledged. Subsequently in a suit between Li Po Kwai and the transferees from his son Li the former tendered evidence to show that the deed of assignment which was subsequently registered was a fictitious deed. He said that no consideration had been passed, and that even though it did not appear on the face of the transfer that one of the transferees was the same as the transferor, that was a fact and he had made this arrangement in order to mark out the properties so that in case of his death the properties might go to his son. Their Lordships held that this evidence was inadmissible and ought not to have been received. 3.
Their Lordships held that this evidence was inadmissible and ought not to have been received. 3. Now, as I have already said, this case comes from another jurisdiction, and it is not quite clear whether there was in force in Hong Kong any enactment corresponding to Ss.91 and 92, Indian Evidence Act and how it was worded. The reasons which were given for holding the evidence inadmissible were (p.261): ".......Perhaps the evidence of the respondent tendered and accepted may euphemistically be termed evidence to rebut the presumption of advancement and incidentally establish a resulting trust, but it was in fact tendered to show that the deed of assignment, followed, by its attested registration, was an elaborate make-believe with, so far as the operative provisions of the deed were concerned, no word of truth in it from beginning to end. There were no "purchasers"; there had been no sale to any one; no purchase money had either been paid or received; it was a mere assignment by the respondent to himself". It is unnecessary, however, to dwell on more than one of these contradictions - that which sought to deny the payment and receipt of purchase price acknowledged in the deed by the respondent and attested by his solicitor." Their Lordships then referred to the case of - Rimmer v. Webster, (1902) 2 Ch. 163 (D), and remarked that the evidence that the purchase money was never paid at all was inadmissible to establish either a lien for unpaid purchase money or that there was a resulting trust for the vendor. The case was consequently decided upon the footing that the evidence tendered contradicted the term of the sale deed which recited the payment and receipt of the purchase price, and where the other contradictions were referred to, for example, there being no purchasers, and there being no sale, they were referred to incidentally. Their Lordships did not go further into the question of those contradictions, because they thought that one about the payment and receipt of the purchase price acknowledged was sufficient. 4. Now, in - Rimmer v. Webster, (D), Rimmer delivered to a stockbroker Hall a mortgage bond for £ 2000 with instructions to sell it. Induced by the false representation of the broker, Rimmer executed two transfer deeds by which the mortgage bond was transferred to the broker in two portions of £ 1500 and £ 500 respectively.
4. Now, in - Rimmer v. Webster, (D), Rimmer delivered to a stockbroker Hall a mortgage bond for £ 2000 with instructions to sell it. Induced by the false representation of the broker, Rimmer executed two transfer deeds by which the mortgage bond was transferred to the broker in two portions of £ 1500 and £ 500 respectively. These transfers were expressed to be made in consideration of £ 1500 and £ 500 respectively paid by the broker to Rimmer. The broker borrowed £ 1000 from the defendant Webster, executed a sub-mortgage of the bond to him, producing the transfers as proof of title and absconded. In an action by Rimmer for retransfer of the deeds to him free from the mortgage to Webster, the defendant relied upon the statement in the transfers that they were in consideration of £ 1500 and £ 500 respectively paid by Hall to Rimmer. It was held that as the owner had not only transferred property to an agent or trustee, but had acknowledged that the transferee had paid full consideration for it, he was estopped from asserting his equitable title against a person to whom the transferee had disposed of the property for value. The ratio of the case consequently was the principle of estoppel and the remarks quoted in - Tsang Chuen v. Li Po Kwai, (C), were made when referring to - Carritt v. Real and Personal Advance Co. (1889) 42 Ch. D 263 (E). In - Tsang Chuen v. Li Po Kwai, (C), their Lordships as a matter of fact based their decision on estoppel also. But it must be admitted that they also held the evidence inadmissible for the purpose of establishing a resulting trust. In any case, if the evidence was excluded as contradicting the document, it appears to me that this case has been decided upon provisions with regard to the admission of evidence which seem to be different from ours. It is not possible to say what exactly the law there is, but it is quite clear that so far as India is concerned, there is no difficulty in spite of Ss.91 and 92 in leading evidence to show, notwithstanding the recital of payment of consideration in a document, that it was actually not paid.
It is not possible to say what exactly the law there is, but it is quite clear that so far as India is concerned, there is no difficulty in spite of Ss.91 and 92 in leading evidence to show, notwithstanding the recital of payment of consideration in a document, that it was actually not paid. That was what was regarded as established law by their Lordships of the Privy Council themselves in - Sah Lal Chand v. Indarjit, 27 Ind App 93 (PC) (F). They observed (p.97): "....Their Lordships, agreeing with the High Court, regard it as settled law, that notwithstanding an admission in a sale deed that the consideration has been received, it is open to the vendor to prove that no consideration has been actually paid. If it was not so, facilities would be afforded for grossest frauds. The Evidence Act does not say that no statement of fact in a written instrument may be contradicted by oral evidence, but that the terms of the contract may not be varied, and c. The contract was to sell for Rs.30,000, which was erroneously stated to have been paid, and it was competent for the respondent, without infringing any provision of the Act, to prove a collateral agreement that the purchase money should remain in the appellants hands for the purposes and subject to the conditions stated by the respondent." 5. In my opinion, therefore, the case of - Tsang Chuen v. Li Po Kwai, (C), which was decided probably under a law of evidence differing from ours, cannot be regarded as an authority in India, when the case of - Tyagaraja Mudaliar v. Vedathanni, (A), states that such evidence is admissible. That, as a matter of fact, has been the view which has been accepted in India by a number of High Courts. The only dissenting voice was that of the Allahabad High Court in the case of - Lachman Das v. Ram Prasad, AIR 1927 All 422 (G).
That, as a matter of fact, has been the view which has been accepted in India by a number of High Courts. The only dissenting voice was that of the Allahabad High Court in the case of - Lachman Das v. Ram Prasad, AIR 1927 All 422 (G). It has got to be remembered that in India especially it would lead to surprising results to hold otherwise, because in this country it is quite usual for persons to enter into two sorts of benami transactions, one, where he buys property with his own money, but in the name of another person, and the other, where he transfers property belonging to him to the name of another person but without the intention to benefit the latter. Some of these latter deeds would be in the form of a sale deed. Some may be fraudulent, but others are perfectly honest. A member of a joint Hindu family may, for example, purchase property from his own funds in the name of another or may transfer to another property so purchased by him in his own name in order to avoid a contention by other members of the joint family that it was joint family property which contention he may not be able to meet if made long afterwards. If it was held in cases where property was so conveyed to another in the form of a sale deed that evidence was not admissible to show that the transaction being benami transaction the transferors would be at the mercy of transferees. The case of - Hanif-un-Nissa v. Faiz-un-Nissa, 33 All 340 (PC) (H), was a case in which the plaintiff claimed that a deed of sale dated 27-9-1889, executed by her in favour of the appellant and another was a fictitious deed. The defendants contended that the deed of sale was in reality intended by the executant to be a deed of gift. Evidence having been allowed to be given by both the sides in support of their case the Subordinate Judge held that natural love and affection was the real consideration and that it was not therefore fictitious, but "a real conveyance by which ownership with possession was transferred".
Evidence having been allowed to be given by both the sides in support of their case the Subordinate Judge held that natural love and affection was the real consideration and that it was not therefore fictitious, but "a real conveyance by which ownership with possession was transferred". On appeal the High Court was of the opinion that the defendants were precluded by the provisions of S.92, Evidence Act from giving oral evidence that the deed of sale was in reality intended by the executant to be a deed of gift. On appeal their Lordships held that the decision of the High Court could not be supported. The plaintiffs case in that case was the same as the plaintiffs case in this case, and if the defendants were allowed to lead evidence that the intention was to make a gift, it must be upon the footing that there was no animus contrahendi, no contract and hence no sale and no sale price. If there was a sale, price would be a term of the contract and evidence would be inadmissible to show that it was different from that mentioned in the deed. (The rest of the judgment is not material to this report.) 6. In the result the appeal fails and it is dismissed with costs. Appeal dismissed.