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Usman Khan Vs. Sitarakhan - Court Judgment

LegalCrystal Citation
SubjectContract
CourtAllahabad
Decided On
Reported inAIR1935All256; 157Ind.Cas.1096
AppellantUsman Khan
RespondentSitarakhan
Cases ReferredMukar Nath v. Shyam Sundar Lal
Excerpt:
- - by merely paying off the creditors the defendants cannot claim to retain this property so long as their debts have not been satisfied......of any money which he has been able to prove that he has advanced to the defendant under these void bonds. reference was also made by learned counsel for respondent to mukar nath v. shyam sundar lal 1929 all. 659, in that case there was a sale by some members of a joint hindu family of property and it was held that the sale deed was invalid but the vendees obtained possession of the property from the usufructuary mortgagees. the court referred to sections 65 and 70, contract act:under which when an agreement is discovered to be void, any person who has received any advantage under such agreement is bound to restore it or to make compensation for it to the person from whom he received it.4. the court also found:by merely paying off the creditors the defendants cannot claim to retain.....
Judgment:
ORDER

Bennet, J.

1. This is an application in civil revision by a plaintiff whose suit has been dismissed by the Small Cause Court. The plaintiff sued for recovery of Rs. 250 principal and interest on the basis of two deeds dated 12th June 1932 for Rs. 100 each. Objection was taken that these deeds were mortgage-deeds of occupancy plots that no possession was delivered and that the mortgages were illegal. The plaintiff asked that the deeds might be treated as ordinary bonds and that a decree should be passed for the amount advanced. The Court held that as the mortgages were illegal, the documents could not be treated as simple bonds and the suit was dismissed. In revision it was asked that the decree should be set aside and the case remanded for disposal on the merits as the lower Court had taken an errroneous view of law. It appears to me that the deeds were mortgages of occupancy land which is forbidden by the Tenancy Act and therefore the deeds come under Section 23, Contract Act, an agreements where the consideration or object was forbidden by law. That section states: 'Every agreement of when the object or consideration is unlawful is void.' Section 24 states:

If any part of a single consideration for one or more objects or any one or any part of any one or several considerations for a single object, is unlawful, the agreement is void.

2. Following the principle laid down in Har Prasad Tewari v. Sheo Govind 1922 All. 134 and Sheo Narain v. Raj Kumar Raj 116 I.C. 17, I hold that the deeds cannot be en forced in any manner even as simple money bonds and therefore the plaintiff cannot sue for the promises of payment of principal and interest in the bond, nor can the plaintiff rely on the covenant in the bonds that if possession is not given, then the plaintiff should receive back the money received. But learned Counsel for the plaintiff has relied on Section 65, Contract Act, which provides:

When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it, or to make compensation for it, to the person from whom ho received it.

3. He claims that as the bonds are bonds under Section 23 therefore the defendant whom he alleges to have received the two sums of Rs. 100 each under the bonds is bound to restore those amounts to the plaintiff. No reference has been made to Section 65, Contract Act, in either of the two rulings mentioned which deal with similar cases and apparently the plaintiffs in those cases did not rely on that section. Learned Counsel for the respondent has not been able to show any reason why that section should not be applied. Accordingly I consider that the plaintiff has a right under Section 65 to the return of any money which he has been able to prove that he has advanced to the defendant under these void bonds. Reference was also made by learned Counsel for respondent to Mukar Nath v. Shyam Sundar Lal 1929 All. 659, In that case there was a sale by some members of a joint Hindu family of property and it was held that the sale deed was invalid but the vendees obtained possession of the property from the usufructuary mortgagees. The Court referred to Sections 65 and 70, Contract Act:

under which when an agreement is discovered to be void, any person who has received any advantage under such agreement is bound to restore it or to make compensation for it to the person from whom he received it.

4. The Court also found:

by merely paying off the creditors the defendants cannot claim to retain this property so long as their debts have not been satisfied.

5. The case was rather different from the present one because in the ruling the plaintiffs claimed that the Sale deed was invalid and that they had a right to possession of the property which was in the possession of the defendants. The defendants claimed that they had a right to hold possession until the debts which he had discharged were paid off. In the present case the plaintiff claims that as the sale deed is invalid he should receive from the defendant the money which he paid the defendant by way of loan. The cases therefore are quite different and the ruling is no authority for the present case.

6. Accordingly I allow this revision and set aside the decree of the lower Court and I remand the suit to the Small Cause Court for disposal on the remaining issues. The costs hitherto occurred will be costs on the suit. The plaintiff may recover the court-fee paid in this Court under the provisions of Section 13, Court-fees Act.


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