JUDGMENT : The judgment passed in this appeal shall also govern the disposal of S.A. No. 97/2001 as there is an order dated 11-9-2012 in this appeal as well as in connected S.A. No. 97/2001 to hear both the appeals together. The plaintiff-Parasram Dubey and defendant-Santosh Kumar are common in both the appeals. The present appeal has arisen from the judgment and decree dismissing the suit of plaintiff for declaration that suit property has already been redeemed and in the alternative a decree of specific performance of contract be passed as well as for the cancellation of sale deed which has been obtained by the defendants on the basis of fraud. The connected second appeal (S.A. No. 97/2001) has been filed against the judgment and decree passed by two Courts below decreeing the suit of plaintiff on the relationship of landlord and tenant for eviction under the Rent Control Legislation namely, M.P. Accommodation Control Act, 1961. 2. This is plaintiffs first appeal under Section 96, CPC against the judgment and decree dated 22-11-1998 passed by learned Second Additional District Judge, Katni in Civil Suit No. 100-A/1989 dismissing the suit of the plaintiff. 3. In brief, the suit of the plaintiff as pleaded in the plaint is that the suit property, the description whereof has been mentioned in the plaint, was owned and possessed by one Guru Prasad and who had since died in the year 1966. After his death, the suit property devolved on his heirs including plaintiff/appellant-Parasram. The plaintiff was managing the property left by his father being Karta Khandan. Thereafter, in the family settlement, the suit property fell in his share and he was possessing the same. The plaintiff is carrying on the business of milk and in order to streamline his business, he was in need of money, as a result of which, from the defendants/respondents, who were well known earlier to him, he made a demand to give Rs. 20,000/- towards loan, however, second defendant-Radhika Prasad agreed to give loan to the plaintiff with a condition that the suit house mentioned as "A", "B", "C", "D" in the plaint map be mortgaged in the name of his son Santosh Kumar (first defendant) and in lieu of interest which was agreed @ Rs. 3.50 which comes to Rs. 7,000/- per month be paid by plaintiff to defendants towards rent.
3.50 which comes to Rs. 7,000/- per month be paid by plaintiff to defendants towards rent. On accepting the aforesaid condition, the plaintiff obtained a sum of Rs. 17,000/- from second defendant through first defendant. The balance amount of loan Rs. 3,000/-was agreed to be paid at the time of execution of mortgage deed. Since the plaintiff was having full confidence upon defendant No. 2 he executed a receipt in the presence of one Ramesh Pachori. But, instead of getting the document executed on stamp paper, the same was executed in the form of receipt by endorsing the back date 17-1-1986 on the said receipt. 4. It is the further case of plaintiff that on 28-7-1987, the defendant No. 2 called the plaintiff to execute the mortgage deed in the Court where plaintiff told that he is not exclusive owner of the suit property but he will only mortgage the suit property. On this, defendant No. 2 rest assured him that document of mortgage deed will be executed and another document of agreement of sale will also be executed. Since plaintiff was having full confidence upon second defendant, who without giving any opportunity to plaintiff to read the document and without reading the same on 29-7-1987 in presence of witnesses San tosh Saravgi and Ramesh Pachori executed the document. In this document, there was a clause to get the suit property alienated in favour of plaintiff and this document of agreement of sale was made the basis of mortgage deed dated 28-7-1987. It was also agreed between the parties that after the loan amount will be paid alongwith interest, the suit property, which was mortgaged, will be redeemed. 5. It is the further case of plaintiff as pleaded in the plaint that in November, 1987 on being 'asked by the plaintiff to submit the accounts, the second defendant told on behalf of defendant No. 1 that a sum of Rs. 25,000/- ( Rs. 20,000/- principal amount and Rs. 5,000/- interest) is to be paid by the plaintiff and it was agreed that this amount will be paid on 11-11-1987. The plaintiffs wife's brother Ram Kumar Tiwari (not examined) by withdrawing a sum of Rs. 25,000/- from his account in the bank gave it to the plaintiff to repay the loan amount on 11-11-1987 in presence of Counsel for the defendants and a sum of Rs.
The plaintiffs wife's brother Ram Kumar Tiwari (not examined) by withdrawing a sum of Rs. 25,000/- from his account in the bank gave it to the plaintiff to repay the loan amount on 11-11-1987 in presence of Counsel for the defendants and a sum of Rs. 1,000/- was paid by plaintiff by selling ornaments of his wife (wife and gold smith not examined). But, the defendants failed to perform their part of contract, as a result of which, plaintiff suffered loss of stamp duty worth Rs. 2,160/- which were purchased by him to execute the document of sale-deed (stamp papers not filed and proved). Eventually, on 17-5-1988 the plaintiff through his Counsel sent notice by registered post to defendant No. 1 asking him to get the sale deed executed in his favour, but, it was a futile exercise. The plaintiff also lodged a report in the police station and also published a public notice. The defendant No. 1 in order to grab the property in dispute submitted an application before MPEB to obtain electric connection in his name in which plaintiff submitted objections. 6. In plaint, further it has been pleaded that the defendants are trying to jeopardize his ownership right and are also trying to interfere in his possession and further plaintiff never sold the suit property to defendants nor he is having exclusive right to get the suit property sold. It has also been pleaded that on the eastern side of suit property shown as "C" and "D" upto the Verandah of the house situated in the western side alongwith two more rooms, the defendants have dispossessed the plaintiff for which they are not having any right. The said portion of the suit house has been given by defendants to some other persons on tenancy basis. According to plaintiff, although suit house was mortgaged by him but with a malofide intention by demonstrating the document to be a sale deed, despite the plaintiff paid the entire loan amount and got the suit property redeemed. Since the defendants are not agreeing to sell the suit property hence present suit has been filed for cancellation of sale deed which has been obtained by defendants on the basis of fraud and prayed that it be declared null and void.
Since the defendants are not agreeing to sell the suit property hence present suit has been filed for cancellation of sale deed which has been obtained by defendants on the basis of fraud and prayed that it be declared null and void. Further relief which has been sought by plaintiff is that because first defendant executed an agreement of resale of the suit property in favour of plaintiff, therefore, it be declared that suit property has been redeemed and the possession of the Suit house be delivered to him. A decree of permanent injunction has also-been sought that defendants should not alienate the suit property and the portion which is in possession of the plaintiff, his possession may not be disturbed by the defendants with a further relief that in case the defendant No. 1 fails to execute the sale deed, the same be executed through Court. 7. The defendants by filing the written-statement refuted the plaint averments and inter alia raised objection that suit has not been properly valued and has been filed without paying -proper Court fee. It has also been pleaded in the written-statement that the partition has taken place between the plaintiff and his brothers is proved, because Keshav entered into an agreement of sale of house No. 341, which fell in his share in favour of one Ram Pratap Tiwari and in this document, it has been mentioned that house Nos. 341/3 and 341/4 (suit house) has fallen in the share of plaintiff, which the plaintiff himself has admitted in his plaint and the suit house was sold by plaintiff for a consideration of Rs. 20,000/- to the first defendant since he was in need of money to streamline his milk business. 8. Further, it has been pleaded in the written-statement that on 17-1-1986 the plaintiff received a sum of Rs. 17,000/- from defendant No. 1 in presence of his brother Mohan and voluntarily a document of agreement of sale was executed. It was also agreed between the parties that Rs. 3,000/- will be paid at the time of registration and it was agreed between the parties that suit property will be sold within two years. The plaintiff with a malafide attitude entered into an agreement of sale on 21-8-1986 with one Chhedilal, although suit property was already sold to defendant No. 1 and thus, plaintiff obtained a sum of Rs. 10,000/- from said Chhedilal.
The plaintiff with a malafide attitude entered into an agreement of sale on 21-8-1986 with one Chhedilal, although suit property was already sold to defendant No. 1 and thus, plaintiff obtained a sum of Rs. 10,000/- from said Chhedilal. He also obtained a sum of Rs. 2,000/- on 22-1-1987 and agreed that suit house will be sold within one year. On coming to know this fact, the first defendant on 28-7-1987 got the sale deed executed, if the sale deed in question was in fact a mortgage deed, the plaintiff who himself is a teacher would not have executed a sale deed. According to defendants, since the transaction was out right sale, therefore, pleading of the plaintiff in respect of interest is false. According to defendants because the plaintiff was exclusive owner of the suit property, therefore, he was competent to get it sold in favour of defendant No. 1. The factum that the document of sale is mortgage deed has been empathetically denied by the defendants because this fact is also clear on bare perusal of document of agreement of sale dated 17-1-1986. 9. It has also been pleaded by the defendants that the document of agreement of resale dated 29-8-1987 is a fabricated document and further it does not bear the signature of defendant No. 1. Although it has been mentioned that it was signed by first defendant but his signature is forged. The other averments made in the plaint are also emphathetically denied. The defendants, thus prayed that suit be dismissed. 10. The learned Trial Court framed as many as 9 issues and after recording the evidence of the parties, dismissed the suit. In this manner, this appeal has been filed by the plaintiff. 11. The contention of learned Counsel for appellant is that looking to the pleadings of the parties and particularly cross-examination of plaintiff Paras 56,57, 64, 65 and 66 and also Paras 13 and 14 of evidence of Ramesh Pachori (P.W. 2), it is proved that transaction was in fact a loan transaction and property in question was mortgaged by the plaintiff and it is also proved that entire loan amount was paid by the plaintiff and the property in question was redeemed. In support of his contention, learned Counsel for appellant has placed heavy reliance on the Division Bench decision of this Court Mandas Vs.
In support of his contention, learned Counsel for appellant has placed heavy reliance on the Division Bench decision of this Court Mandas Vs. Manbai, 1972 JLJ 632 , and has submitted that in such type of cases, the Court is required to see whether sale deed was ever required to be acted upon. By placing reliance upon the decision of Supreme Court in Ramlal and another Vs. Phagua and others, (2006) 1 SCC 168 , Para 14, it has been contended that if the mortgage is made by a conditional sale or sale with a condition of re-purchase the true nature of the transaction and intention of the parties is to be seen. By placing reliance upon Single Bench decision of this Court in Smt. Munnibai and ethers Vs. Barelal Lodhi and others, 2007(4) M.P.H.T. 194 , it has been contended that in this decision, this Court placed reliance upon the decision of Supreme Court in Ramlal and another (supra), and has contended that if the sale deed executed by defendant in favour of plaintiff not containing in itself a condition by plaintiff to re-convey the property and a separate document of agreement of sale is executed by plaintiff on the same day although transaction is not a mortgage, but it is open to the Court to hold that the sale deed was a nominal document and never intended to be acted upon and it was executed only for collateral security. By placing heavy reliance upon the decision of Supreme Court in Gulab Chand (dead) by LRs. Vs. Babulal (dead) by LRs. and others, (1998) 9 SCC 211 , it has been contended that in this case also there were three documents firstly sale deed, secondly, agreement of re-conveyance and thirdly rent note, but, in that case also, Apex Court has held that there was a loan transaction between the parties. In the present case also, there is a document of sale deed, another document of re-conveyance and third document of rent note and looking to the evidence placed on record and pleadings of the parties it is proved that transaction was of a loan and not out right sale. By placing reliance on another decision of Supreme Court Shyam Singh Vs. Daryao Singh (dead) by LRs.
By placing reliance on another decision of Supreme Court Shyam Singh Vs. Daryao Singh (dead) by LRs. and others, (2003) 12 SCC 160 , it has been submitted that no period was fixed in regard to the re-conveyance and in the present case also, there is no such period embodied in the document and hence it has been prayed that by allowing this appeal, the impugned judgment and decree be set aside and suit of plaintiff be decreed. 12. Combating the aforesaid submissions of learned Counsel for the appellant, it has been put-forth by learned Counsel for respondents that transaction was an out and out sale and it was not a loan transaction. Learned Counsel by inviting my attention to Section 58 (c) of the Transfer of Property Act has submitted that if two documents namely sale deed and agreement of sale are separately executed, transaction would never be a loan transaction and it would be only outright sale and in this regard reliance has been placed on the latest decision of Supreme Court in Raj Kishore (dead) by LRs. Vs. Prem Singh and others, (2011) 1 SCC 657 . Learned Counsel has also placed reliance upon the decision of Supreme Court in Chunchun Jha Vs. Ebadat Ali and another, AIR 1954 SC 345 . Reliance has also been placed upon three more decisions of Supreme Court in Mushir Mohammed Khan (dead) by LRs. Vs. Sajeda Bano (Smt.) and others, (2000) 3 SCC 536 Para 14, Bishwanth Prasad Singh Vs. Rajendra Prasad and another, (2006) 4 SCC 432 Para 27 and Manjabai Krishna Patel (dead) by LRs. Vs. Raghunath Revaji Patil and another, (2007) 12 SCC 427 Paras 9 to 19. By placing reliance on Single Bench decision of this Court in Shatrughan Prasad Vs. Ramprasad and another, 2012 (1) JLJ 156 , it has been contended that obtaining of consideration accepted by seller before Sub-Registrar, the Civil Suit for declaration of sale deed to be null and void on the basis of playing fraud cannot be accepted. The contention of learned Counsel for respondents is that learned Trial Court has assigned cogent reasons while dismissing the suit holding that transaction is not of mortgage but it was outright sale and hence it has been prayed that appeal be also dismissed. 13.
The contention of learned Counsel for respondents is that learned Trial Court has assigned cogent reasons while dismissing the suit holding that transaction is not of mortgage but it was outright sale and hence it has been prayed that appeal be also dismissed. 13. Having heard learned Counsel for the parties, I am of the view that this appeal as well as connected second appeal deserves to be dismissed. 14. Indeed the case of the plaintiff rests upon Section 58 (c) of the T.P. Act, which speaks about mortgage by conditional sale. It would be condigned to reproduce the said provision, which read thus :- "58 (c). Mortgage by conditional sale :- Where the mortgagor ostensibly sells the mortgaged property- on condition that on default of payment of the mortgage money on a certain date the sale shall become absolute, or on condition that on such payment being made the sale shall become void, or on condition that on such payment being made the buyer shall transfer the property to the seller, the transaction is called mortgage by conditional sale and the mortgagee, a mortgagee by conditional sale. Provided that no such transaction shall be deemed to be a mortgage, unless the condition is embodied in the document which effects or purports to effect the sale." (Emphasis supplied) Indeed the proviso stipulated to the section was not enacted when the T.P. Act was originally enforced and has been added by Section 19 of Act 20 of 1929. Before I deal with the rival contentions of parties as well as pleadings and evidence placed on record, it shall be fruitful to put emphasis on the law to this provision. On bare perusal of the proviso, I find that whatever the nature of transaction has taken place and the documents have been executed, the transaction shall be deemed to be a mortgage only when the condition is embodied in the document itself which effects or purports to effect the same. Thus, according to me embodying such a condition is an essential ingredient to invoke this provision and to ascertain whether the transaction is mortgage by conditional sale. According to me, the proviso was introduced in this clause only to set at rest the controversy of nature of the document because earlier there were controversies in regard to interpretation of document whether it is a sale or mortgage.
According to me, the proviso was introduced in this clause only to set at rest the controversy of nature of the document because earlier there were controversies in regard to interpretation of document whether it is a sale or mortgage. After the insertion of the proviso the things are clear as like noon day that a document will never be treated as mortgage unless and until a condition of reproduce is contained in the same document and this has been specifically held by the Supreme Court in the landmark decision Chunchun Jha (supra). 15. At this juncture, I would be failing in my duty if I do not quote the report of Special Committee on the basis of which the aforesaid proviso has been added to Section 58 (c) of the T.P. Act. In 10th Edition of Transfer of Property Act of Mulla at Page 589 the report has been quoted and in order to understand why and for what reason the said proviso has been added, I would like to quote the said Committee's report, which reads thus :- "Section 58 (c) contains the definition of a mortgage by conditional sale. It is with the greatest difficulty in many cases that such mortgages can be distinguished, from sale with a condition for repurchase. As clause (c) of Section 58 indicates, the real point of difference between the two kinds of transactions is that, in the case of a mortgage by conditional sale, the sale is only ostensible, whereas in the case of an out and out sale, it is real. The ostensible or real nature of transaction can, however, be only determined by finding out the intention of the parties. In order to escape the liability of accounting for the profits of the property and other liabilities imposed on a mortgagee, and also to escape the provisions of some of the local laws enacted for the benefit of agriculturists, creditors resort to the mode of having a mortgage which is in form of an out and out sale. Since the decision of the Privy Council in Balkishan Das Vs. Legge, it has been a well-settled rule that it is once open to Courts to allow any extraneous evidence in order to find out the intention of the parties. Such intention must, therefore, be gathered from the document itself which purports to effect the transaction.
Since the decision of the Privy Council in Balkishan Das Vs. Legge, it has been a well-settled rule that it is once open to Courts to allow any extraneous evidence in order to find out the intention of the parties. Such intention must, therefore, be gathered from the document itself which purports to effect the transaction. These transactions have given rise to a great deal of litigation and Courts are compelled to enumerate and consider all the various criteria which have been laid down for the purpose of determining whether a transaction is a mortgage or an out and out sale. In order to avoid the difficulties indicated above, we think it desirable to lay down a statutory test by which the intention is to be gathered. We, therefore, propose that no transaction should be deemed to be a mortgage by conditional sale unless the condition is embodied in the document which operates or purports to effect the sale." Thus, it is luminously clear that unless and until the condition of transfer is not embodied in the document which effects and purports to effect the sale, the transaction cannot be said to be a mortgage and in another words it shall amount to a deed of sale only. Apart from the decision-in Chunchun Jha 's case (supra), there are several other landmark decisions of the Apex Court, they are Bhaskar Warman Joshi (deceased) and others Vs. Shrinarayan Rambilas Agarwal (deceased) and others, AIR 1960 SC 301 and K. Simrathmull Vs. Nanjalingiah, AIR 1963 SC 1182 . I may further add that if a document purports to be a deed of sale and there is no stipulation for treating the sale as mortgage, merely a separate document of conveyance cannot convert it into a mortgage. To put in simple words at the cost of repetition it would be fruitful to say that a document whatever it has been named would never be a mortgage deed by conditional sale if the clause of re-sale has not been embodied in the same document. According to me, if the said condition is laid down by executing a separate document (whatever the said document may be named), the transaction cannot be said to be a mortgage transaction in any manner. 16. Indeed, Shri Zargar, learned Counsel for respondents has rightly placed reliance upon the latest pronouncement of Supreme Court in Raj Kishore (dead) by L.Rs.
According to me, if the said condition is laid down by executing a separate document (whatever the said document may be named), the transaction cannot be said to be a mortgage transaction in any manner. 16. Indeed, Shri Zargar, learned Counsel for respondents has rightly placed reliance upon the latest pronouncement of Supreme Court in Raj Kishore (dead) by L.Rs. Prem Singh (supra). In this decision also, two documents were executed. The first document is registered sale-deed which was executed on 6-7-1974 by one Raj Kishore and a separate document of agreement of repurchase was executed. The Supreme Court in Para 17 held that although the jale deed and deed of conveyance and rent were no doubt parts of same transaction yet the transaction did not constitute a mortgage by conditional sale. The Supreme Court while holding so in Para 18, placed reliance upon the decision of Federal Court in Shanmagam Filial Vs. Anna Lakshmi Ammal, AIR 1950 FC 38. In another decision Mushir Mohammed Khan (dead) by LRs. (supra), there was a registered sale-deed, dated 28-12-1955 and few days later, on 3-1-1956 another document of agreement was executed. The Supreme Court again by placing reliance on landmark decision Chunchun Jha (supra), in Para 14 the Supreme Court after reading two documents arrived at a conclusion that it would not constitute mortgagees condition of mortgage is not embodied in the same document and thus by placing reliance upon proviso to clause (c) of Section 58 of T.P. Act, it was held that transaction was not mortgage by conditional sale. In Bishwanth Prasad Singh (supra), the Supreme Court in Para 25, by placing reliance on earlier decision in Roop Kumar Vs. Mohan Thedani, (2003) 6 SCC 595 , held that every jural act may have the following four elements :- (a) the inaction or creation of the act; (b) its integration or embodiment in a single memorial when desired; (c) its solemnisation or fulfillment of the prescribed forms, if any; and (d) the interpretation or application of the act to the external objects affected by it. Thereafter, in Paras 26 and 27, the Supreme Court while testing the aforesaid elements to Section 58 (c) of T.P. Act has laid down the law that if the two documents are executed separately the transaction cannot be said to be mortgage by conditional sale.
Thereafter, in Paras 26 and 27, the Supreme Court while testing the aforesaid elements to Section 58 (c) of T.P. Act has laid down the law that if the two documents are executed separately the transaction cannot be said to be mortgage by conditional sale. Similar principle has been laid down by the Apex Court in Manjabai Krishna Patel (dead) by L.Rs. (supra), placed reliance by learned Counsel for respondents. 17. By keeping the aforesaid principles which are laid down by the Apex Court in juxtaposition to the documents which are impugned in this suit and by testing the aforesaid principles on the touchstone and anvil of the present factual scenario, it would reveal that two separate documents were executed between the parties. The first document is registered sale-deed, dated 22-7-1987 (Exh. D-2) by which the plaintiff sold the disputed property to first defendant-Santosh Kumar and the second document is an agreement of sale dated 29-7-1987 (Exh. P-1). The execution of these documents is proved in the evidence of parties and it is not in dispute. Learned Counsel for the parties also did not dispute the execution of these two documents during the course of their argument. The third document is rent note (Exh. D-3), dated 29-7-1987, in which the plaintiff has admitted the ownership of first defendant-Santosh Kumar and he took the suit house on rental basis @ Rs. 700/- per month. The execution of this document is also not disputed either in the pleading or during the course of arguments. Thus, according to me, on the basis of legal position which has been enumerated hereinabove since absolutely there is no condition of resale in the document of sale-deed (Exh. D-2) and the document of agreement of resale (Exh. P-1) has been executed on different date by executing altogether different document, I am not having any scintilla of doubt in my mind in holding that transaction whatever it may be named cannot be said to be a mortgage by conditional sale and I am not having any hesitation to hold that it was an outright sale. The decisions placed reliance by learned Counsel for appellant are distinguishable in this backdrop. In Gulab Chand (dead) by LRs.
The decisions placed reliance by learned Counsel for appellant are distinguishable in this backdrop. In Gulab Chand (dead) by LRs. (supra), three documents namely sale-deed, agreement of repurchase and rent note were executed on the same date but in the present case they were executed on different dates and therefore, this decision which has been heavily placed reliance by learned Counsel for appellant is not at all applicable. Apart from this in that case, the relationship of landlord and tenant was not proved. The decision of Ramlal (supra), placed reliance by learned Counsel for appellant is not applicable because in that case time of three years was stipulated for re-payment of loan amount. But, in the present case, in the agreement of resale (Exh. P-1), no time has been fixed and, therefore, on facts this case is distinguishable. 18. I have gone through the reasonings assigned by learned Trial Court and I find that by rightly appreciating the evidence of parties vis-a-vis to each other and the pleadings it has been held that transaction in question was outright sale and was not a transaction of conditional sale. The said finding is based upon correct appreciation of evidence and, therefore, it would be futile exercise if I reproduce the same. 19. Resultantly, this appeal fails and is hereby dismissed with no order as to costs. 20. Let a copy of this judgment be kept in the record of S.A. No. 97/2001.