Panchachara Mudaliar v. Kandaswami Achari — 1994 DIGILAW 997 (MAD)

Judgment : The defendants 1 to 3 who have lost in both the courts below are the appellants in this appeal. 2. The plaintiff filed the suit in O.S.No.490/79 on the file of the District Munsif of Tirukoilur for redemption of suit properties and for determination of mesne profits and for costs. It is the case of the plaintiff that on 20-12-1972, the plaintiff executed a conditional sale in favour of Unnamalai Ammal, the mother of the defendants 1 to 3 for a sum of Rs.7,500/- and according to the said document he should re-purchase the property within 6 years, after paying the amount and also that failing which the sale will be absolute in favour of Unnamalai Ammal, It is the case of the plaintiff that at the relevant time, the value of the property was more than Rs.10,000/- and that the patta stood in the name of the plaintiff and that the intention of the parties was to create only a mortgage by conditional sale and not a sale with a clause for re-purchase. It is the further case of the plaintiff that he is an agriculturist as per Act 4 of 1938 as amended by Act 8 of 1973, and that the suit mortgage was executed before 15-7-1978 and hence as per Section 8 of the Act 40 of 1979, the plaintiff is entitled for the scaling down amount and that he is liable to pay only Rs.2750/-. In spite of the repeated demands, the defendants did not agree for the redemption of the property and hence he filed the present suit depositing a sum of Rs.2,750/-. 3. The first defendants filed a written statement which was adopted by the defendants 2 and 3 wherein they have admitted about the execution of the document. But would contend that it is not a mortgage by conditional sale but this is a sale with a clause for re-purchase. It is the specific case of the defendants that the plaintiff has not transferred the possession in favour of Unnamalai Ammal and that the plaintiff is not entitled for scaling down. The defendants also submitted that since the possession of the land was with the plaintiff, the plaintiff cannot claim the benefit of Act 40 of 1979. It is the specific case of the defendants that the plaintiff has not transferred the possession in favour of Unnamalai Ammal and that the plaintiff is not entitled for scaling down. The defendants also submitted that since the possession of the land was with the plaintiff, the plaintiff cannot claim the benefit of Act 40 of 1979. The defendant has admitted that the plaintiff is paying the kist for the suit property and that the plaintiff is not entitled to scaling down. The defendants raised various other contentions also. 4. The trial court on the construction of the document which is marked as Ex.B1 (Copy of the same is marked as Ex.A1) held that it is only a mortgage by conditional sale and not a sale with a clause for re-purchase. On the second issue, the trial court held that the plaintiff is entitled for scaling down amount and redemption of amount, and consequently passed preliminary decree for redemption. Aggrieved by the said judgment of the trial court, the defendants 1 to 3 filed an appeal in A.S.221/81 on the file of Sub-Court, Cuddalore. The Sub-Court also concurred after elaborately discussing the evidence available on record and dismissed the appeal. Aggrieved by the judgment of the lower appellate court, defendants 1 to 3 have preferred the above appeal. 5. At the time of admission of the second appeal, the following question of law was framed: “Whether on its true construction, the suit document Ex.B1 is a document of sale with a condition for repurchase, or a mortgage by conditional sale?” 6. Before making the submissions on the facts of the present case, the learned counsel for the appellant referred to the judgment of the Supreme Court in Bhoju Mandal v. Depnath Bagath (A.I.R. 1963 SC 1906). The learned counsel in particular drew the attention of this court to para-4 of that judgment which is to the effect that there is a clear distinction between two concepts a mortgage by conditional sale and a sale with a condition of repurchase and as to the question to which category the document belongs presents a real difficulty which can only be solved by ascertaining the intention of the parties, on a consideration of the contents of a document and other relevant circumstances. The Supreme Court further observes in the said case that the decided cases have laid down many tests to ascertain the intentions of the parties but they are only illustrative and not exhaustive. It is the settled law on this point and with regard to that there is no difficulty. 7. Thereafter, the learned counsel for the appellant pointed out certain facts and circumstances in the present case, which according to him would show that Ex.B 1 is nothing but a sale with a condition for re-purchase and not a mortgage by conditional sale. The reasons- according to the appellant are (1) in Ex.B1 the recitals are and that further the words are also used which would show that it is only a sale. (2) The stamp papers stand in the name of Unnamalai Ammal, (3) P.W.1 in his evidence has not stated that the parties to the document intended the transaction to be only that of a mortgage by conditional sale, (4) only because of the time granted in the document namely 6 years prior to which the plaintiff was given option to re-purchase, the patta was transferred in the name of the Unnamalai Ammal. 8. Let me now consider these reasons or circumstances which according to the appellant the suit transaction is a sale and not a mortgage by condition sale. The first point raised by the learned counsel for the appellant is that in the document the words are used and that when read alone with the other words would show it is only a sale. This submission cannot be accepted because the document must be read as a whole and further one has to see what the parties actually intended to create under the document simply because the words are used, it cannot be said it is only a sale. That apart, according to Sec.58-C of the Transfer of Property Act 1882, it is to the effect whether the mortgagor ostensibly sells the mortgaged property on condition that on such Payment being made, the buyer shall transfer the property to the seller the transaction is a mortgage by condition sale. Hence simply because the words are used it cannot be said that the parties intended the transaction only to be that of a sale. The parties may agree that on such payment being made the buyer shall transfer the property to the seller. Hence simply because the words are used it cannot be said that the parties intended the transaction only to be that of a sale. The parties may agree that on such payment being made the buyer shall transfer the property to the seller. Hence, the first reasoning given by the learned counsel for the appellant to construe the document as a sale is not acceptable. The second reasoning pointed out by the learned counsel for the appellant is that the stamp papers for Ex.B1 stand in the name of Unnamalai Ammal. As far as this reasoning is concerned, it is true that normally in the case of sale, the stamp papers will be purchased by the purchaser and the stamp papers will stand in the name of the purchaser. As far as this case is concerned, on this aspect both the parties have not let in any evidence. In other words, the plaintiff was not questioned on this aspect while he was in the witness box by the learned counsel for the defendants. Similarly nothing has been stated with regard to this by the defendants in the written statement. In the above suit the first defendant and the 3rd defendant deposed before the court as DW2 and DW1 respectively. They too have not spoken anything with regard to this. At best these reasonings given by the learned counsel for the appellant can only be said as one circumstance in favour of the defendants. As far as the 3rd reasoning viz., that the plaintiff has not spoken to in his evidence that the parties intended the transaction only to be that of a mortgage. It is relevant to point out that the plaintiff has even in his notice dated 23-1-1979 has clearly stated that the suit transaction is only a mortgage by conditional sale. Coming to the evidence of P.W.1 a reading of the evidence as a whole both in chief and cross would reveal that it can be well said that the plaintiff has in his testimony has claimed that the suit transaction is only a mortgage by condition sale. The last reasoning that Unnamalai Ammal or the defendants did not take steps to transfer the patta in their name because the 6 years period not lapsed. The last reasoning that Unnamalai Ammal or the defendants did not take steps to transfer the patta in their name because the 6 years period not lapsed. This cannot be accepted for a simple reason, that once there is a sale one would expect the purchaser to get the revenue records changed in his or her name. This is because there is no certainty that the seller will repurchase the property within the granted time. For all practical purposes as well as in law once the sale is completed, the purchaser is the owner and he is entitled to get the revenue records changed in his name. 9. As against this, the following facts and circumstances would show that the suit transaction is only a mortgage by conditional sale and not a sale with a clause for repurchase: 1) The recitals under Ex.B1. are clear and are to the effect that only after the expiry of 6 years the transferee would enjoy the property absolutely. The words “ .(2) The registration charges were paid by the transferor that is the plaintiff herein. (3) The extent of the suit property is 2.84 acres and the consideration mentioned in the document Ex.B1 is Rs.7,500. According to the plaint the suit properties are worth more than Rs.10,000/-. This has not been denied in the written statement. The plaintiff in his evidence has stated that the suit property on the date of Ex.B1 was worth Rs.14,000/-. Again this has not been disputed by the defendants. But, on the other hand, DW2 would only say that he is not aware what was the value of the land on the relevant date viz., the date of Ex.B1. (4) Even after the sale the defendants did not take any steps to approach the revenue authorities seeking for transfer of patta. In fact DW1 has submitted that the patta stands in the name of the plaintiff. In the written statement it is specifically admitted that only the plaintiff is paying the kist, even after the transaction under Ex.B1. (5) DW2 in his evidence has clearly stated “ .(6) The condition for repurchase is embodied in the same document. (7) The consideration for re-conveyance was Rs.7,500/-. The same amount is the consideration for Ex.B1. 10. In the written statement it is specifically admitted that only the plaintiff is paying the kist, even after the transaction under Ex.B1. (5) DW2 in his evidence has clearly stated “ .(6) The condition for repurchase is embodied in the same document. (7) The consideration for re-conveyance was Rs.7,500/-. The same amount is the consideration for Ex.B1. 10. Learned counsel for the respondent also drew the attention of this court to the judgment of the Supreme Court in Bapuswami v. V.P. Gounder (1966-2 SCR 918) and in particular page No.923 as well as the decision in Kalyani alias Pandi v. Vellaichami Alias Udaya Thevar (1977 TLNJ 290) and submitted that the above facts and circumstances would show that the suit transaction is only a mortgage by conditional sale and not a sale with a clause for re-purchase. 11. Having regard to the language of the document under consideration, viz., Ex.B1, and examining it in the light of the circumstances, I am of the view that the transaction under Ex.B1 was only a mortgage by conditional sale and not a sale with a clause for repurchase. Hence, the findings of the courts below are correct on this issue. 12. The learned counsel for the appellant would contend that the plaintiff is not entitled for the benefits of the Act 40/79 and for scaling down the amount. Both the courts below have concurrently found on this issue that right from the date of Ex.B1, Unnamalai Ammal and after her life time, the defendants have been enjoying the property in question and that being so, the plaintiff is entitled for the benefits under Sec.9 of the Act 40/79 and that he is not entitled for scaling down. This is purely a question of fact and I do not find any reason to interfere with the concurrent findings of the courts below. There are no merits in the second appeal and the same is liable to be dismissed and accordingly the same is dismissed. However, there will be no order as to costs. 13. The appellants have also filed C.M.P.No. 12088/82 under Order 41 Rule 27 of C.P.C., praying this Court to admit additional evidence, the documents marked as A,B,C.,viz., two cultivation accounts and birth certificate. At the outset, it may be noted that all these documents the appellant came into possession even by November 1981. 13. The appellants have also filed C.M.P.No. 12088/82 under Order 41 Rule 27 of C.P.C., praying this Court to admit additional evidence, the documents marked as A,B,C.,viz., two cultivation accounts and birth certificate. At the outset, it may be noted that all these documents the appellant came into possession even by November 1981. The lower appellate court took up the matter for hearing on 17-2-1982. In the affidavit filed in support of the petition, the appellants have not even stated that in spite of his due diligence, the documents were not within his knowledge or could not be produced by him in time at the time when the decree appealed against was passed. The petitioner has not given any acceptable reason for allowing this C.M.P. Hence this C.M.P is dismissed.