Kukaji v. Basantilal — 1954 DIGILAW 58 (MP)

ORDER : This revision petition arises out of the plaintiff non-applicant's suit for redemption of a mortgaged house. The facts are that on 3-4-1931 one Bherulal mortgaged with possession a house belonging to him with Kukaji for Rs.200/- One of the terms of the mortgage was that if the mortgagor failed to redeem the property within eight years of the date of the mortgage, it shall be deemed to have been sold to the mortgagee. Bherulal did not, however, redeem the mortgage within the stipulated period. On 8-4-1939, he, however, executed a sale deed in favour of Kukaji transferring the house to him, the consideration being the mortgage debt and the amount spent by Bherulal on the repairs and improvements to the property. This sale deed was not registered. On 12-4-1939 Bherulal sold the equity of redemption on this mortgage to Basantilal by a registered deed. Thereafter Basantilal instituted on 9-10-1939 the suit giving rise to this petition against the mortgagee for the redemption of the property. The main plea on which Kukaji resisted the suit was that Bheruial having sold the mortgaged house to him on 8-4-1939, the mortgage was thereafter no longer subsisting and that, therefore, Bheruial had no right to sell any equity of redemption to Basantilal and that further Basantilal purchased the equity of redemption with the full knowledge of the transaction of sale in his i.e., in Kukaji's favour Kukaji also raised the plea that the plaintiff was not entitled to redeem the property without paying in addition to the mortgage-debt the amount that he had spent on the repairs and improvements of the property. The Civil Second Class Judge, Agar who tried the suit gave to the plaintiff a decree for the possession of the property on payment of Rs.200/-the amount of the mortgage and Rs.597-6-8 the cost of repairs and improvements to the mortgagee. The plaintiff and the defendant then both appealed to the District Judge, Shajapur. The plaintiff's appeal was for reducing the price of redemption to Rs.200/- only, while the defendant's appeal was for the dismissal of the plaintiff's suit and in the alternative for enhancing the price of redemption by a further amount of Rs.106-8-0 which he had spent on the improvements to the property. Both these appeals were rejected by the learned District Judge. Both these appeals were rejected by the learned District Judge. The defendant-mortgagee has now preferred this revision petition against the decision of the District Judge, Shajapur. 2. Before me Mr. Shastrabudhe learned counsel appearing for the petitioner did not dispute that the insertion of the clause in the mortgage deed that in default of payment within eight years the mortgage would operate as a sale could not be regarded as "an act of parties" extinguishing the right of redemption. He, however, relied on the sale deed dated 8-4-1939 executed by Bherulal in favour of Kukaji as extinguishing the right of redemption and said that though this document was unregistered yet inasmuch as Kukaji continued in possession of the property after 8-4-1939 as a vendee and as the plaintiff Basantilal had notice of this contract of sale, therefore, Kukaji's rights under the deed dated 8-4-1939 could not be affected in any way by the registered deed dated 12-4-1939 in favour of Basantilal and that, therefore, Basantilal was not entitled to the possession of the property. To my mind, there are many hurdles in the way of acceptance of this plea which the applicant unsuccessfully urged in the Courts below. The plaintiff's suit was filed in 1939 long before the Gwalior Transfer of Property Act came into force in the former Gwalior state and long before the coming into force of the Transfer of Property Act, 1882 in Madhya Bharat. It has been held by a Division Bench of this Court in - 'Pannaial v. Labhchand', AIR 1955 Madh-B 49 (A) that S.53-A T.P. Act, 1882 is retrospective in the sense that it applies to suits filed alter 1-4-1930, though the contract was entered into before S.53-A came into operation and that S.54, Gwalior T.P. Act would similarly apply to all suits instituted after that Act came into force in 1945 in the former Gwalior State, although the transaction was effected before its enactment. As in the present case the plaintiff's suit was filed in 1939, there can be no question of the defendant availing himself of the statutory defence under S.53-A, T.P. Act, 1882 or S.54, Gwalior T.P. Act. Realising this position learned counsel for the applicant said that even before the coming into force of the Gwalior Transfer of Property Act the equitable doctrine of part performance was applied in the former Gwalior State. Realising this position learned counsel for the applicant said that even before the coming into force of the Gwalior Transfer of Property Act the equitable doctrine of part performance was applied in the former Gwalior State. He placed reliance on - 'Bapuji v. Kukaji' AIR 1954 Madh-B 128 (B). It may be conceded on the basis of AIR 1954 Madh-B 128 (B) and on the numerous decisions of the Gwalior High Court that the equitable doctrine of part performance was applied in Gwalior State even before the enactment in that State of the Transfer of Property Act. But in my opinion this does not assist the applicant in escaping from the difficulty occasioned by his failure to get the sale deed dated 8-4-1939 registered under the mandatory provisions of S.9, Gwalior Registration Act, Samvat 1971. Even under the equitable doctrine of part performance the applicant must show that he continued in possession of the mortgaged property in part performance of the contract dated 8-4-1939 and then he did some act in furtherance of the contract. It was argued that the sale deed dated 8-4-1939, if read with the mortgage deed of 3-4-1931 conclusively showed that the applicant continued in possession of the mortgaged property in part performance of the contract embodied in the deed dated 8-4-1939 and that the fact that before the execution of the deed of 8-4-1939 the mortgagor Bherulal and Kukaji took an account of the moneys spent by Kukaji on the improvements and repairs to the property with a view to sell the property for the amount of the mortgage debt and the cost of repairs, was an act in furtherance of the contract dated 8-4-1939. Leaving aside the question whether under S.41, Gwalior Registration Act which did not contain a proviso analogous to S.49, Indian Registration Act, 1908 and in the absence of a statutory provision such as S.54, Gwalior T.P. Act, the deed dated 8-4-1939 could be admitted in evidence, the deed would at the most show that the defendant continued in possession of the mortgaged property in part performance of the contract. The execution of the deed itself or the terms thereof are no proof of any act done by the applicant in furtherance of the contract. The taking of the accounts of the moneys spent on repairs and improvements is an act preliminary to the completion of the contract. The execution of the deed itself or the terms thereof are no proof of any act done by the applicant in furtherance of the contract. The taking of the accounts of the moneys spent on repairs and improvements is an act preliminary to the completion of the contract. It is well settled that the act of part performance must not be an act preparatory to the completion of the contract and that acts introductory to and previous to the agreement cannot be treated as acts of part performance. The defendant-applicant has not been able to prove any act done by him in furtherance of the contract. Relying on - 'Ratanlal v. Kishanlal', AIR 1952 Raj 141 (C), Mr. Sahstrabudhe contended that as the mortgagee was already in possession of the property and as the sale was for the consideration of the mortgage-debt and the amount spent by the mortgagor on repairs and improvements, the applicant could do nothing as an act in furtherance of the contract and that he could only get a sale deed executed by Bherulal. I do not think the Rajasthan High Court's decision relied upon by the learned counsel lays down the proposition that if in the circumstances of any case no act in furtherance of the contract could be done than the mere execution of a deed of sale is sufficient to give to the defendant the benefit of the doctrine of part performance. In the Rajasthan case the question was whether the execution of the sale deed coupled with the payment of an amount of consideration by the transferee to the transferor proved the fact that the transferee continued in possession of the property in part performance of the contract and that he did some act in furtherance of it. It was held that in the circumstances of that case the execution of the sale deed and the payment of the consideration amount satisfied the requirements necessary to give the benefit of doctrine of part performance to the party concerned. As I have said above, for availing the benefit of this doctrine it is essential to show that the transferee has done some act in furtherance of the contract. As I have said above, for availing the benefit of this doctrine it is essential to show that the transferee has done some act in furtherance of the contract. It is not necessary to speculate as to what act done in furtherance of the contract the applicant could have been proved when no money was to be paid by him under the contract to Bherulal. The fact remains that the applicant has not proved any such act. He cannot, therefore, claim the benefit of the doctrine of part performance. It was said that after the execution of the deed dated 8-4-1939 the applicant filed a suit for specific performance of that contract and that this was an act done in furtherance of the contract. To my mind the filing of a suit for specific performance is an act for enforcing the contract and not one done in furtherance of the contract. 3. Another difficulty in giving to the applicant the benefit of the doctrine of part performance is that the applicant has not established the fact that the transfer to Basantilal was not for consideration or that he had notice of the contract of sale in favour of Kukaji or of the part performance thereof. Mr. Sahstrabudhe sought to argue that as Bherulal had notice of the contract in favour of Kukaji, it would be deemed that the transferee from him, namely, Basantilal, had also notice of that contract. In support of this contention, Mr. Sahstrabudhe cited the cases of - 'S.N. Banerjee v. Kuchwar Lime and Stone Co. Ltd.', ATR 1941 PC 128 (D) and-'Hemraj v. Rustamji', AIR 1953 SC 503 (E). But in none of these cases I find any observation to support the contention advanced by Mr. Sahstrabudhe. In AIR 1941 PC 128 (D) their Lordships of the Privy Council have said that S.53-A, T.P. Act created no real right, that it merely created rights of estoppel between the proposed transferee and the transferor which have no operation against third person not claiming under these persons. In the instant case the applicant as well as the non-applicant are both persons claiming under the transferor Bherulal. The Privy Council decision has, therefore, no applicability whatsoever to the present case. In the instant case the applicant as well as the non-applicant are both persons claiming under the transferor Bherulal. The Privy Council decision has, therefore, no applicability whatsoever to the present case. In the case of Hemraj, the Supreme Court made the observation that the proviso to S.53-A, Transfer of Property Act saves the right of a transferee for consideration who has no notice of the contract of which there was part performance, that is to say, "any rights which the transferee under the unregistered document may have on the strength of part performance of the contract against the transferor would not be of any avail against a bona fide transferee for value from the transferor who had no notice of the transaction." Learned counsel for the applicant seems to have taken the words "who had no notice of the transaction" as refer to the transferor when actually they referred to the bona fide transferee. The Supreme Court decision also does not lend any support to the contention of the learned counsel for the applicant. As the applicant failed to prove that Basantilal was not a bona fide transferee for value and that he had notice of the transaction in favour of Kukaji, any right which the applicant might have got under the deed of 8-4-1939 cannot affect the rights of Basantilal under the registered deed of 12-4-1939. 4. It was then argued that because of the omission of the trial Court to frame proper issues in the suit, the applicant could not lead evidence to prove any act done by him in furtherance of the contract, the collusive nature of the transaction in favour of Basantilal and the fact that he had notice of the contract of sale dated 8-4-1939 in favour of Kukaji. This contention may be disposed of by saying that the defence of the doctrine of part performance involves questions of fact and the defendant claiming the benefit of the doctrine must raise the plea in his written statement. No such plea was taken by the applicant and he did not even in the appellate court make any complaint that the issues properly arising on his written statement had not been framed and investigated. No such plea was taken by the applicant and he did not even in the appellate court make any complaint that the issues properly arising on his written statement had not been framed and investigated. In the memorandum of appeal filed by him before the District Judge, Shajapur, the applicant only said in ground No.5 that the learned trial Judge was not justified in saying that the applicant produced no evidence to show that Basantilal had knowledge of the transaction dated 8-4-1939, when the trial Judge framed no issue on the point. In that memo the applicant nowhere prayed that as proper issues had not been framed in the suit it should be remanded. 5. The next contention put forward by Mr. Sahstrabudhe was that as registration was not part of the execution and as after executing the deed, it was not open to the executant to go back on his agreement and revoke it, the rights acquired by the applicant under the unregistered deed dated 8-4-1939 can in no way be affected by the mere fact that the subsequent deed in favour of Basantilal was registered. The decision in - 'Mahadeo Singh v. Mian Din', AIR 1938 All 431 (F) was referred to by the learned counsel as supporting this contention. In effect the contention is that the deed dated 8-4-1939 though not registered, is yet a valid document affecting the property dealt with by it and can be received as evidence of the transaction of sale of the property. The contention has only to be stated to be rejected. The decision of the Allahabad High Court does not lay down any such novel proposition. In that case all that was considered was whether after the execution of a gift deed or sale deed and before the registration of the deed, it was open to the executant to revoke the deed. Indeed if the contention of the learned counsel for the applicant is accepted, then the provisions of Ss.17 and 49, Registration Act would be rendered altogether nugatory. 6. Indeed if the contention of the learned counsel for the applicant is accepted, then the provisions of Ss.17 and 49, Registration Act would be rendered altogether nugatory. 6. Lastly it was said that under S.20, Gwalior Registration Act a document affecting immovable property had to be presented for registration before a sub-Registrar within whose district the property was situated and that under S.22 the Registrar could receive and register the document only after recording his reasons for so doing, that in the present case the property in suit was situated in Agar, that the registered document dated 12-4-1939 in favour of Basantilal was received and registered by the registrar at Shajapur without recording any reasons as required by S.22. This argument is devoid of any substance. Sections 20 and 22, Gwalior Registration Act correspond to Ss.28 and 30, Indian Registration Act. Under S.22 the registrar is empowered to receive and register in his discretion any document which might be registered by any sub-registrar subordinate to him. This section nowhere says that the registrar must record his reasons before receiving and registering the document. The word in S.22 means in his discretion and not after recording his reasons. 7. For the foregoing reasons, I am of the view that the decision of the courts below are right. This petition is accordingly dismissed with costs. Petition dismissed.