Skip to content


H.S. Shama Rao Vs. Patel Kanake Gowda and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty;Contract
CourtKarnataka High Court
Decided On
Case NumberSecond Appeal No. 283 of 1957
Judge
Reported inAIR1962Kant203; AIR1962Mys203
ActsEvidence Act, 1872 - Sections 92
AppellantH.S. Shama Rao
RespondentPatel Kanake Gowda and anr.
Appellant AdvocateK.V. Vasanth and ;H.N. Venkatachala, Advs.
Respondent AdvocateA.B. Hanappa and ;K.V.S. Ramaswamy, Advs.
Excerpt:
.....with the terms of exhibit i, and ,therefore, it was impossible for the defendant to prove that oral agreement under proviso (2). (11) whether proviso (1) has any application is the next question to be considered. under that proviso what may be proved is a fact which would invalidate a document or which would entitle any person to any decree or order, and any fact which may be so proved is a fact such as fraud, intimidation, illegality, want of due execution, want of capacity in any contracting party, want or failure of consideration, or mistake in fact of law. ' (13) it seems to me impossible for any one to suggest that ,when the defendants sought to prove an agreement creating a condition precedent like the one on which they rely, they attempted to prove a fact like the one referred..........30, 1953, after the institution of the suit.(3) both the courts below recorded a finding that the oral agreement set up by the defendants 1 and 2 was proved and accordingly dismissed the plaintiff 's suit. the plaintiff appeals.(4) on behalf of the plaintiff mr. venkatachala, his learned advocate, contends that this was not a case in which the oral agreement set up by the defendants could have been allowed to be proved, since the agreement on which they depended not one which could have been provided under any of the provisos to section 92 of the evidence act. it is clear-- and that position is not also contested --- that it would not have been open to the defendants to prove the oral agreement on which they relied unless the agreement fell within one or the other of the five provisos.....
Judgment:

(1) This Second Appeal involves the construction of proviso (1),(2) and (3) to section 92 of the Evidence Act. The question arises in this way. On October 28, 1952, defendant 1 executed in favour of the plaintiff a sale deed (Exhibit I) , by which he purported to convey to the plaintiff a house which is the subject-matter of the suit for a sum of Rs. 800/-. The sale deed was presented for registration by the plaintiff on March 14, 1953 and was registered on April 25, 1953 by the Sub-Registrar although the plaintiff was not present before the Sub-Registrar on that day. Defendant 1 who appeared before the Sub-Registrar admitted execution of the document, but nevertheless pleaded that the document should not be registered amount by the plaintiff. The translation of what he stated before the Sub-Registrar in Kannada reads:

'I have no objection to the registration of the document if I am paid the consideration. Since the plaintiff has not appeared before me and paid the consideration , I will not agree to the registration of the document or to affix my signature to the endorsements.'

The Sub-Registrar, not unnaturally, declined to accede to the contention of defendant 1 and he accordingly registered the document. But the was not able to obtain possession of the house from defendant 1, with the result that he instituted the suit out of which this Second Appeal arises plaintiff was not able to obtain possession of the house. On that day he deposited in Court Rs. 800/- which represented the consideration payable to defendant 1 for the sale in his favour.

(2) The main defence to the suit was that there was a condition which had been agreed to by the plaintiff to the effect that, if the plaintiff did not pay the consideration in the presence of the Sub-Registrar at the time of registration of the sale -deed, the sale deed should be regarded as cancelled and become null and void. This was the stand taken by defendant and also by defendant 2 in whose favour, very cursory, a sale deed was executed by defendant 1 in respect of the suit house of May 30, 1953, after the institution of the suit.

(3) Both the Courts below recorded a finding that the oral agreement set up by the defendants 1 and 2 was proved and accordingly dismissed the plaintiff 's suit. The plaintiff appeals.

(4) On behalf of the plaintiff Mr. Venkatachala, his learned advocate, contends that this was not a case in which the oral agreement set up by the defendants could have been allowed to be proved, since the agreement on which they depended not one which could have been provided under any of the provisos to section 92 of the Evidence Act. It is clear-- and that position is not also contested --- that it would not have been open to the defendants to prove the oral agreement on which they relied unless the agreement fell within one or the other of the five provisos appearing in section 92 of the Evidence Act. Their contention, however, is that the oral agreement set up by them fell either within proviso (1) or proviso (2) or proviso (3) and was therefore rightly allowed to be proved by the Courts below.

(5) The short question which arises in this Second Appeal is, whether that contention urged on behalf of the defendants can be recognised as valid or whether Mr. Venkatachala is right in contending the agreement which the defendant's sought to prove amounted to a contradiction or variation of the terms of Exhibit I, the sale deed in favour of the plaintiff, and therefore could not be proved.

(6) The precise contention taken by the defendants in their written statement is to be found in paragraph 1 of the written statement of defendant 1. This is how that paragraph reads:

'This defendant admits that the suit document was written on 28-10-1952. The circumstances in which the said document was written were as follows: The defendant owed a sum of Rs. 750/- and interest thereon to the 2nd defendant from whom the amount had been taken with an understanding to repay the same within a few days. But as this defendant could not repay the same, this defendant approached the plaintiff who demanded that if the suit schedule properties are sold to him will pay the amount. The plaintiff was aware of the urgency of this defendant. It was agreed that the sale -transactions should take place on 28-10-1952 and this defendant had also requested the 2nd defendant to go Dodballapur on 28-10-1952 the suit document was written and it was agreed at that time also that the document should be registered on the same day and that the consideration amount must be paid on the same day in the presence of the Sub-Registrar; as otherwise the document should be treated as cancelled, null and void. 'The relevant portion of Exhibit I which is the sale-deed executed in favour of the plaintiff reads:

'Unstained house built with bricks and mortar and upstair house also. V.P. Kandayam Rs. 14/- have been sold to you for a sum of Rs. 800/- for my urgent necessity, before the attesting panchayatdars, agreeing to receive the full consideration amount before the Sub-Registrar at the time of registration. I have given possession of the property paying its Kandayam etc. This property has not been alienated to any body in any way; in case any dispute had to arise in future I myself will get the same settled and you and your heirs i.e., children etc., can enjoy the property with all its usufruct and benefits.'

(7) Exhibit I, it will be seen from the aforesaid recital, purports to record a completed sale. The agreement set up by the defendants was that there was an agreement that 'the document should be treated as cancelled, null and void' if the document was not registered on the same day and the consideration was not paid in the presence of the Sub-Registrar.

(8) The Court below proceeded to dismiss the plaintiff suit on the assumption that the agreement set up by the defendants was in effect one which created a condition precedent. This is what the Munsiff said in paragraph 13 of his judgment:

'Though there are no express recitals in this document the several circumstances in this case discussed above clearly g to show that it was the intention of the defendants 1 and 2 that consideration amount should be paid on the same date and that the document should also be registered on the same date failing which it would render to document void.'

The Civil Judge, in paragraph 9 of his judgment, observed:

'The recitals in the document Exhibit I clearly go to show that the amount should be paid to the first defendant at the time of the registration of Exhibit I. The money has not at all been paid before the Sub-Registrar. The recitals in the document are as follows: (Original to regional language omitted.) It can only be taken that there was a condition precedent that the amount should be paid in the presence of the Sub-Registrar.'

It will be seen from these two judgments that neither of the courts below depended upon any particular proviso to section 92 in support of their conclusion that the oral argument on which the defendants relied could be proved.

(9) But Mr. Ramaswamy appearing on behalf follow defendant 2 has urged that it was possible for the defendants to prove the oral agreement not only under the provisions of proviso(1) to Section 92 of the Evidence Act but also under proviso (3). Mr. Mariappa, in addition, submitted that the agreement could be proved also the under the second proviso to that section. Those three provisos read:

'92. 'When the terms of any such contract, grant or other disposition of property, or any matter required by law to be reduced to the form of a document, have been proved according to the last section, no evidence of any oral agreement or statement shall be admitted, as between the parties to any such instrument or their representatives in interest, for the purpose of contradicting, varying, adding to, or subtracting from its terms.

Proviso (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, want or failure of consideration, or mistake in fact of 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 decree 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. * * * *'

(10) The argument that proviso (2) can have application to the present case may be dismissed very briefly. That proviso, it is clear, permits proof of a separate oral agreement only on a matter which is not inconsistent with the terms of the written document. The agreement set up by the defendants in this case was one which was clearly inconsistent with the terms of exhibit I, and , therefore, it was impossible for the defendant to prove that oral agreement under proviso (2).

(11) Whether proviso (1) has any application is the next question to be considered. I have no doubt in my mind that proviso can also have no application. Under that proviso what may be proved is a fact which would invalidate a document or which would entitle any person to any decree or order, and any fact which may be so proved is a fact such as fraud, intimidation, illegality, want of due execution, want of capacity in any contracting party, want or failure of consideration, or mistake in fact of law.

(12) 'Fact' is defined by section 3 of the Evidence Act and that definition reads:

'Fact' means and includes---

(1) anything, state of things, or relation of things, capable of being perceived by the senses;

(2)any mental condition of which any person is conscious.'

(13) It seems to me impossible for any one to suggest that , when the defendants sought to prove an agreement creating a condition precedent like the one on which they rely, they attempted to prove a fact like the one referred to in proviso (1) to Section 92. What may be proved under that proviso is, something, some event or some-one at the time of the execution of the document, and it would not be right or correct to think that, if the defendants wanted to prove an agreement reached between the plaintiff and defendant 1 at the time of the execution of Exhibit I that the sale-deed should become void or should be treated as cancelled if the consideration was not paid before the Sub-Registrar, they were proving a fact like what has been enumerated in proviso (1) to section 92.

(13A) The next reason why section 92 proviso (1) cannot have any application to the present case is that the fact which may be proved under that proviso should be one which would invalidate a document or which would entitle a person to a decree or order relating thereto. The enumeration of those facts which may not be exhaustive, but only illustrative, but the facts which may be proved must be analogous to any of those pleas to which express reference is made by proviso (1) to section 92. In my opinion, that proviso can be of no assistance to the defendants. ]

(14) What, therefore remains to be considered is, whether the defendants could have proved the oral agreement on which they relied, under proviso(3), That proviso permits proof of a separate oral agreement constituting a condition precedent to the attaching of any obligation under any contract or disposition of property.

(15) If the defendants had relied upon an agreement constituting a condition precedent to the attaching of any obligation under Exhibit I it would have been permissible for them to prove such agreement. But what can be seen from the written statements presented by the defendants in this case is that it was not pleaded by them that the oral agreement on which they relied constituted a condition precedent to the attaching of any obligation under Ext. I. It was not their case that the agreement between defendant should attach to Exhibit I unless the plaintiff paid the consideration before the Sub-Registrar or the document was registered on the same day it was executed. On the contrary their plea was not that no obligation should attach to Exhibit I if those two conditions had not been fulfilled, but that Exhibit I should be treated as cancelled and null and void. In effect their plea was that Exhibit I which recorded a completed transaction and became fully effective and operative with its execution, should be treated as cancelled and become null and void if there was failure to pay the consideration before the Sub-Registrar or failure to get the document registered on the date of its execution.

(16) Both the Courts below entirely misconstrued proviso (3) and overlooked the words 'condition precedent to the attaching of any obligation' occurring in proviso (3). It appears to me that, although they have not stated in so many words, both the courts below were under the impression that the defendants could prove the oral agreement under that proviso. They did not however record a finding that the oral agreement that the oral agreement on which the defendants depended constituted a condition precedent to the attaching of any obligation to Exhibit I. The learned Munsiff did not in clear terms express a finding that the oral agreement created a condition precedent. The learned Civil Judge, although he recorded a finding that the oral agreement constituted a condition precedent, did not record a further finding that the condition was one precedent to the attaching of any obligation under Exhibit I.

(17) It seems to me that is having regard to the written statements produced by the defendants in this case, impossible for the Courts below to record a finding that the oral agreement which they pleaded, constituted precedent to the attaching of any obligation under Exhibit I.

(18) Proviso (3) to section 92 which permits proof of an oral agreement, does no more than to the incorporate the principle which is enunciated in Pym. v. Champbell, (1856) 6 El and Bl 370. That was a case in which the defendants agreed in writing to buy an invention from the plaintiff subject to the oral stipulation that the transaction was conditional on the approval of the invention by the defendants' engineer. The defendants' engineer did not approve of the invention and the condition consisting of this oral stipulation had been proved. In his judgment Lord Campbell said :

'It was proved in the most satisfactory manner that before the paper was signed, it was explained to the plaintiff that the defendants did not intend the paper to be agreement till A had been consulted and found that approved of the invention; and that the paper was signed before he was seen only because it was not convenient for the defendants to remain. The plaintiff assented to this, and received the writing on those terms. That being proved, there was no agreement.'

Erle J., observed :

'The point made is that there is written agreement, absoulte on the face of it, and that evidence was admitted to show that 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 accords 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 parcel 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 a s an agreement upon those so singing. 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 this is admissible.'

(19) That is the distinction which should be borne in mind before applying proviso (3) to the present case. The rudimentary rule which was enunciated in (1856) 6 Eland Bl 370, was that, if evidence, should be rejected, but if evidence to show that there was no agreement at all is sought to be produced, that evidence should be allowed to be produced. It seems to me that principle is what is in corporate in proviso (3) to section 92.

(20) In Tyagaraja Mudaliar v. Vedathanni , their Lordships of the Privy Council observed at P. 459 (of ILR Mad) : (at P. 74 of AIR), that the Indian Legislature has given statutory effect to the decision in (1856) 6 El and Bl 370, in proviso 3 to section 92.

(21) In Jugtanand Miser v. Nerghan Singh, ILR 6 Cal 433, Garth, C.J ., while referring to proviso (3) section 92, observed:

'I think that the District Judge has taken strange view of proviso 3. That proviso, as it seems to me, is intend to introduce into the law of evidence the rule which is well established and understood in England, and treated of in S. 1038 of Mr. Taylor's book on Evidence. That rule is that when, at the time of a written contract being entered into, it is orally agreed between the parties that the written agreement shall not be of any force or validity until some condition precedent has been performed, parol evidence of such oral agreement is admissible to show that the condition has not been performed, and consequently that the written contract has not become binding.'

(22) In Walter Mitchell v. Tenant : AIR1925Cal1007 , page, J. said thus at page 683 (of ILR Cal) : (at pp. 1009-1010 of AIR) :

'But under section 92, proviso (3), it is provided that 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.' Now, the true construction, in my opinion, to be placed upon that proviso is that the provisions thereof are inapplicable in a case in which any obligation under the written contract has attached, and that if the effect of the alleged contemporaneous oral agreement is merely to suspend the performance of the obligations contained in the written contract evidence of such oral agreement cannot be admitted. On the other hand, it is permissible to adduce evidence of a contemporaneous oral agreement under which the parties to the written contract agreed that until the happening of a certain event no obligation what ever under the written agreement should attach, or, in other words, that until the condition precedent has been fulfilled the written agreement should be and remain inoperative and of no effect.'

(23) If the defendants, therefore, had offered to prove an oral agreement to the effect that Exhibit I shall not be any validity or be operative until some condition precedent had been fulfilled, such oral agreement would have been admissible to show that the condition had not been performed and consequently Exhibit I had become void. The rule which could have been applied in a case of that kind is that the manual delivery of an instrument may always be proved to have been made on a condition which has not been fulfilled. But that was not what the defendants pleaded in this case. What they stated was that the agreement between the plaintiff and defendant 1 was that if Exhibit I was not registered on the very date of its execution and consideration was not paid before the Sub-Register, Exhibit I should be treated as cancelled, null and void. In other words, their plea was that until Exhibit I was treated as cancelled on account of the non-payment of the consideration before the Sub-Registrar on the stipulated date, Exhibit I would be binding and effective. It is obvious that the agreement was not one falling within proviso 3 to section 92 of the Evidence Act.

(24) In the view that I take, this appeal must succeed. The decrees of the Courts below should be and are set aside. There will now be a decree in favour of the plaintiff declaring him to be a decree for possession of the suit house to him and there shall be an enquiry in regard to mesne profits under Rule 12 of Order XX of the Code of Civil Procedure.

(25) In the circumstances, having regard to the fact that the plaintiff did not present himself before the Sub-Register on the date of registration of Exhibit I, does not appear to me that in this litigation the plaintiff should be awarded any costs. The direction in regard to costs, therefore, is that each party will bear his own costs throughout.

(26) Appeal allowed.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //