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Devisahai Premraj Mahajan Vs. Govindrao Balwantrao and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMadhya Pradesh High Court
Decided On
Case NumberFirst Appeal No. 14 of 1959
Judge
Reported inAIR1965MP275
ActsTransfer of Property Act, 1882 - Sections 49 and 53A; Code of Civil Procedure (CPC) , 1908 - Sections 64 - Order 1, Rule 10(2) - Order 6, Rule 2 - Order 20, Rule 4 - Order 22, Rule 10 - Order 41, Rule 20; Contract Act, 1872 - Sections 2 and 13
AppellantDevisahai Premraj Mahajan
RespondentGovindrao Balwantrao and ors.
Appellant AdvocateS.D. Sanghi, Adv.
Respondent AdvocateD.C. Bharuch and ;Agrawal, Advs. (for Nos. 1, 2 and 3) and ;Chafekar and ;Rudra, Advs. (for No. 3)
Cases ReferredBhagwantsingh v. Sri Kishen Das
Excerpt:
- - therefore, the mortgagee's remedy was only to enforce the agreement of sale, which he had failed to do. 3) made by sardar govindrao to the sub-registrar requesting him to come to his house for registration of the sale deed in favour of devisahai clearly indicates that a completed and properly executed sale deed in favour of dsvisahai had been attached to the application (ex. 1) clearly admitted that he had signed the draft sale deed in favour of devisahai. 3), a former agent of sardar govindrao have clearly stated that the draft sale deed in favour of devisahai had been executed and signed by sardar govindrao. provided that nothing in this section shall affect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof'.in the.....p.k. tare, j. 1. this appeal is by the defendant against the decree, dated 10-1-1959, passed by shri s.l. sharma, second additional district judge, indore, in civil suit no. 14 of 1961, decreeing the first respondent's suit for redemption of it mortgage, dated 26-11-1929 which he had executed in favour of the appellant, devisahai. 2. the first respondent, sardar govindrao is owner of the suit house. he executed a possessory mortgage in favour of the appellant on 26-11-1929 for a consideration of rs. 10,000/-. subsequent to the mortgage, certain other developments have taken place on the strength of which the appellant contests the mortgagor's right to redeem. according to the appellant, the mortgagor had agreed to sell the mortgaged properly to him for a consideration of rs. 50,000/-; and.....
Judgment:

P.K. Tare, J.

1. This appeal is by the defendant against the decree, dated 10-1-1959, passed by Shri S.L. Sharma, Second Additional District Judge, indore, in Civil Suit No. 14 of 1961, decreeing the first respondent's suit for redemption of it mortgage, dated 26-11-1929 which he had executed in favour of the appellant, Devisahai.

2. The first respondent, Sardar Govindrao is owner of the suit house. He executed a possessory mortgage in favour of the appellant on 26-11-1929 for a consideration of Rs. 10,000/-. Subsequent to the mortgage, certain other developments have taken place on the strength of which the appellant contests the mortgagor's right to redeem. According to the appellant, the mortgagor had agreed to sell the mortgaged properly to him for a consideration of Rs. 50,000/-; and in pursuance of the same, a sale deed was actually executed and duly signed on 10-10-1950. But before presentation of the sale deed for registration, the mortgagor changed his mind; and by using the other stamp papers of the deed except the first and the last, the mortgagor altered it into a deed of sale, dated 14-10-1950 in favour of the second respondent. Gyarsilal, for a consideration of Rs. 50,000/-. At the time of the sale deed in favour of the appellant, an account of the mortgage transaction was made and a round sum of Rs. 25,000/- was settled to he adjusted. The appellant was to pay the balance of Rs. 25,000/- in cash. As there was a completed contract in favour of the appellant, he claimed the benefit of part performance under Section 53A of the Transfer of Property Act to resist the mortgagor's claim for redemption, and also contended that the second appellant, Gyarsilal did not get any valid title by virtue of the subsequent sale deed, dated 14-10-1950 executed by the mortgagor.

3. The plaintiff respondents contended that the mortgagee, Devisahai was not entitled to resist the claim for redemption by relying on the doctrine of part performance and that Section 53A of the Transfer of Properly Act was not at all attracted

4. To add to this confused state of affairs, one, Motilal (now respondent 3 who was not impleaded in the trial Court, but who has now filed an application for being impleaded as a party, and who was provisionally permitted to he impleaded as a respondent by order, dated 3-5-1962) had filed a suit against the mortgagor, Sardar Govindrao in the year 1947. He had attached the suit house before judgment on 6-11-1947 Subsequently, he obtained a money decree. That decree was put in execution on 27-3-1951, and the suit house was put to auction on 25-3-1953 Motilal himself purchased the properly for a consideration of Rs 300/-. Of course, his purchase could only be subject to the mortgagee's right. Therefore, by virtue of the said auction sale, Motilal now claims to be a person interested in the equity of redemption, as also he resists the mortgagee's right to retain the properly on the strength of part performance, as according to him the agreement to sell either in favour of the appellant. Devisahai or in favour of the second respondent Gyarsilal was during the pendency of his attachment. Therefore, according to him, neither of the vendees is entitled to possession as against his, and he alone is entitled to redeem, and not the original mortgagor, Sardar Govindrao. This Motilal had not been a party in the trial Court. Therefore, the learned Judge had no occasion to consider the questions that are now sought to be raised by Motilal.

5. The learned Judge of the trial Court held that the mortgagor had executed a sale deed of the mortgaged house in favour of the defendant Devisahai as alleged in paragraph 7 of the written statement. However, as the sale deed was not registered, the mortgagee did not get any right except to enforce the agreement of sale. As regards the mortgagee's contention that he could rely on the doctrine of part performance, the learned Judge held that Section 53A of the Transfer of Property Act was not attracted for the reason that no payment was made to the mortgagee in furtherance of the contract of sale. Therefore, the mortgagee's remedy was only to enforce the agreement of sale, which he had failed to do. As he could not rely on the doctrine of part performance because Section 53A of the Transfer of Property Act was inapplicable, he could not resist the plaintiffs' suit for redemption. It was further held that the mortgagor had executed a valid sale deed in favour of the second plaintiff, Gyarsilal, and, therefore, the vendee. Gyarsilal also had a right of redemption. In that view, a decree for redemption was passed in favour of both the plaintiffs.

6. The learned counsel for the appellant urged the following points:--

(i) That the view of the trial Judge that Section 53A of the Transfer of Property Act is inapplicable is incorrect.

(ii) That accounts already settled between the mortgagee and the mortgagor cannot be allowed to be reopened; and even if the appellant be held not entitled to the benefit of part performance, be would be entitled to claim Rs. 25,000/- towards the mortgage transaction on the basis of settled accounts.

(iii) That the subsequent vendee, Gyarsilal got no title to the property and he has no right of redemption.

(iv) That Motilal, a person having interest in the equity of redemption by virtue of the auction sale in his favour, has not been impleaded, and consequently the equity of redemption not vesting in the plaintiffs alone, the present suit is not tenable.

7. The learned counsel for respondents 1 and 2 contests these contentions of the learned counsel for the appellant. On the other hand, the learned counsel for the third respondent, Motilal contests the title of the mortgagor and the subsequent vendee, Gyarsilal and claims for himself an exclusive right of redemption. He also contests the appellant's right to be entitled to the benefit of part performance alleging that the contract of sale had taken place during the pendency of attachment before judgment Consequently, the appellant cannot claim any title or any part performance, with the result that his mortgage to liable to be redeemed by Motilal alone.

8. Before dealing with the contentions raised on behalf of Motilal, which are directed against the defendant, as also the plaintiffs, we propose to deal with the contentions of the learned counsel for the appellant.

9. Taking up the first question whether a draft sale deed was actually executed in favour of the appellant by the first respondent, Sardar Govindrao, it is to be noted that the learned Judge of the trial Court has found it as a fact that the sale deed had been executed and signed by Sardar Govindrao. The learned counsel for respondents 1 and 2 challenged this finding of the trial Judge, and contended that unless the sale deed had been got registered, Sardar Govindrao could change his mind, and execute another sale deed in favour of Gyarsilal.

10. The application, dated 10-10-1950 (Ex. P. 3) made by Sardar Govindrao to the Sub-Registrar requesting him to come to his house for registration of the sale deed in favour of Devisahai clearly indicates that a completed and properly executed sale deed in favour of Dsvisahai had been attached to the application (Ex. D. 2) which are some pages from the original sale deed in favour of the appellant, and the sale deed, dated 14-10-1960 (Ex. P. 1) definitely indicates that the stamps for executing a sale deed in favour of Devisahai had been purchased on 10-10-1950. Ex. D. 2 had been properly executed and signed by Sardar Govindrao However, it was not presented for registration. The document also shows that it had been properly attested by witnesses. It is pertinent to note that the other stamp papers in the sale deed in favour of Gyarsilal have been purchased on 14-10-1950, while the first and the last pages of the sale deed bear stamp which had been purchased on 10-10-1960. Evidently, the said pages were taken out of the sale deed executed in favour of Devisahai and were substituted by fresh stamp papers, while the rest of the pages of the sale deed in favour of Devisahai were used for the purpose of constructing a sale deed in favour of Gyarsilal. Thus there can be no doubt that a completed sale deed had been executed in favour of the appellant, and all the pages of the same except the first and the last were used for constructing a sale deed in favour of Gyarsilal, as the appellant probably thought that the draft sale deed in favour of the appellant was not in accordance with the agreed terms. Therefore, he probably changed his mind and decided to complete the sale in favour of Gyarsilal.

11. The oral evidence also on this point confirms the view of the trial Judge. Sardar Govindrao (P. W. 1) clearly admitted that he had signed the draft sale deed in favour of Devisahai. The appellant's witnesses, namely, Devisahai (D. W. 1), V.T. Kotwal (D.W. 2) and Shankarrao Vitthalrao (D.W. 3), a former agent of Sardar Govindrao have clearly stated that the draft sale deed in favour of Devisahai had been executed and signed by Sardar Govindrao. Therefore, we have no reason to differ from the view of the trial Judge in this behalf. Accordingly, we hold that a completed sale deed had bean executed and duly signed by Sardar Govindrao in favour of the appellant. But therefore it could be presented for registration, the first and the last pases of the same were substituted by fresh stamp papers and by using the old draft, a fresh sale deed was executed in favour of Gyarsilal. These facts would never have come to light but for the fact that Sardar Govindrao subsequently filed an application for refund of the stamp duty regarding the draft sale deed in favour of Devisahai and that was how these facts came to light.

12. The further question, however, arises whether the appellant is entitled to invoke the doctrine of part performance as per Section 53A of the Transfer of Property Act. The necessary ingredients of the said section are as follows:--

'Where any person contracts to transfer for consideration any immovable property by writing signed by him or on his behalf from which the term's necessary to constitute the transfer can be ascertained with reasonable certainty, and the transferee has, in part performance of the contract, taken possession of the property or any part thereof, or the transferee, being already in possession, continues in possession in part performance of the contract and has done some act in furtherance of the contract, and the transferee has performed or is willing to perform his part of the contract, then, notwithstanding that the contract, though required to be registered, has not been registered, or, where there is an instrument of transfer, that the transfer has not been completed in the manner prescribed therefor by the law for the time being in force, the transferor, or any person claiming under him shall he debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided by the terms of the contract: Provided that nothing in this section shall affect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof'.

In the present case, the subsequent vendee, Gyarsilal cannot clearly avail of the proviso mentioned in the last clause of the section, as he was clearly aware of the earlier transaction in favour of Devisahai, which, however, remained incomplete for want of registration. It was never the plea of the plaintiffs that the said Gyarsilal had no knowledge of the earlier transaction and that he was a transferee for consideration who had no notice of the contract. Consequently. It is unnecessary to consider that aspect.

13. It is further clear that the first clause of the said section stands fulfilled, inasmuch at there was not only a contract to transfer for consideration immoveaable property by writing signed by Sardar Govindrao, from which the terms necessary to constitute the transfer could be ascertained with reasonable certainty but also there was actually a completed sale deed executed by Sardar Govindrao in favour of the appellant which was, however, not registered. Even the testimony of the first respondent as P. W. 1 discloses that after receiving the draft sale deed, he had put his signature on the deed. It was not that he was not aware of the contents of the deed, or that there was any fraud, mis-representation, undue influence or coercion practised on him. His subsequent version that he merely signed the sale deed in ignorance of the real terms does not appear to be worth reliance. Therefore, the position in the present case is that the sale deed (Ex. D. 2) had been executed by Sardar Govindrao in favour of the appellant. The only question, however, will be whether the second, third and the fourth clauses of the said section have been fulfilled in the present case.

14. At this stage, we may observe that during arguments, the learned counsel for the parties cited rulings ad infinitum. It is not the rulings that can ultimately be the decisive factor in the ultimate judgment. The attempt of the learned counsel for both the sides was to cite the ruling first, and then to try to adjust facts according to their interpretation or misinterpretation within the frame work of those rulings. This is not the correct process. It is first necessary to settle facts and to see whether the relevant provisions of law are attracted, or as to which of the rulings are applicable. Therefore, we propose to settle the necessary facts before considering the provisions of the law or the numerous rulings cited at the Bar.

15. It is to be noted that for the purpose of attracting the doctrine of part performance as per Section 53A of the Transfer of Property Act, the only defect permissible is one of registration. An unregistered sale deed, which has otherwise been completed, or any agreement of sale in writing would be the requisite material. From this point of view, the learned counsel for the first and the second respondents urged that the second and the third clauses of Section 53A of the Transfer of Property Act had not been fulfilled, inasmuch as nothing was done in furtherance of the contract, as the transferee was already in possession. Mere continuance in possession in part performance of the contract is not enough. In addition, the transferee has to do some act in furtherance of the contract. In reply to this, the contention of the learned counsel for the appellant is that payment of the part price was done in furtherance of the contract and, therefore, the conditions mentioned in the second clause are fulfilled.

16. In this connection, attention was invited to the application made by Sardar Govindrao to the District Registrar, Indore, dated 10-10-1950 (Ex. P. 5) for going to his house for registration of the sale deed. In the said application. Sardar Govindrao clearly mentioned that the sale deed had been executed in favour of the appellant for a consideration of Rs. 50,000/-. As he himself was unable to attend the office, the Registrar was requested to come to his house for completing the registration. In the receipt, dated 9-10-1950 (Ex. P. 8), Sardar Govindrao mentioned that there was an agreement of conditional sale, in lieu of which the appellant should pay Rs. 1000/- to meet the costs of stamp duty. It is not disputed that it was the first respondent, who was to hear the expenses of the sale deed. There was no liability, whatsoever, on the appellant to hear those expenses. Therefore, the suggestion of the learned counsel for the appellant is that this payment of Rs. 1000/- in two small instalments of Rs. 300/- and Rs. 700/- paid on 9-10-1950 and 10-10-1950 would be an act in furtherance of the contract of sale, which fact would satisfy the second clause of Section 53A of the Transfer of Properly Act. As against this, the contention of the learned counsel for the first and the second respondents is that anything done anterior to the execution of the unregistered document would not he an act in furtherance of the contract of sale. Therefore, according to the learned counsel for the first and the second respondents, this payment of Rs. 1000/ cannot he considered to be a fact in fulfilment of the condition laid down by the second clause. In this connection, we might refer to some of the cases cited at the Bar.

17. In Ma Thet v. Ma Se Mai, ILR 13 Rang 17: (AIR 1934 Rang 304), Dunkley J. expressed the view that where the purchaser was already in possession of the property as mortgagee, and he continued in possession after the agreement to sell had been concluded, in pursuance of which a part of the price was paid in addition to the amount already due on the mortgage, such payment would be an unequivocal act which could not he referable to any other matter except the agreement of sale; and as such it would he an act in part performance of the contract of sale, so as to satisfy the requirement of Section 53A of the Transfer of Property Act. This case was later on explained by a Division Bench of the same High Court of which Dunkley J. himself was a member, namely, Ohn Maung v. Maung Po Kwe, AIR 1938 Hang 365, wherein the same learned Judge observed that he had made rather broad observations in ILR 13 Rang 17: (AIR 1934 Rang 304) (supra). The learned Judge observed that a distinction must he drawn between a writing which is a reduction into writing of a previous oral agreement which will fall within the ambit of Section 53A of the Transfer of Properly Act, and a writing in which there is a mere reference to a previous oral agreement which will not attract the provisions of Section 53A of the Transfer of Property Act. The point of distinction would he whether an unregistered sale deed itself can he used for the purpose permissible under Section 53A of the Transfer of Properly Act. The writing referred to evidently does not mean any and every collateral writing wherein a reference to the oral agreement might be made. But the writing should be one evidencing the terms of the contract. It may he in the form of an agreement, or it may he some limes in the form of a draft sale deed which has for some reason or the other not been got registered. We have no doubt that such a draft sale deed can be used for the purpose of Section 53A of the Transfer of Property Act, and it cannot be excluded from consideration merely because the oral agreement containing the terms might have preceded the execution of the draft sale deed, What is necessary is that the contract itself should he in writing. The draft sale deed would evidently be a reduction into writing of the oral agreement. Therefore, it is not possible to accept the suggestion of the learned counsel for the first and the second respondents that the Division Bench case of the Rangoon High Court would conclude the matter against the appellant. In our opinion, what the learned Judges of the Division Bench slated was that any reference to the terms of the contract in some collateral transaction or writing would not be sufficient to attract Section 58A of the Transfer of Property Act. We, are in agreement with that proposition, but the said case is clearly distinguishable, inasmuch as the writing was found by the learned Judges not to be a contract of sale. There can be no quarrel with that proposition.

18. In this connection, we might refer to the observations of a Division Bench, consisting of Mangalmurti and Deo JJ. in Mst. Radhabai v. N.J. Nayudu, ILR (1950) Nag 799: AIR 1951 Nag 285, wherein a draft lease deed was prepared before the final thekapatra was to be executed. That was to ensure that there should be no difference of opinion, and no changes in the terms of the thekapatra. The learned Judges held that the draft itself could be used in proof of part performance as per Section 53A of the Transfer of Properly Act. As such a course is permissible by virtue of the proviso to Section 49 of the Registration Act, we have no doubt that where an oral agreement has been reduced info writing and the writing itself does not become a sale deed for want of registration, that writing can undoubtedly be used to establish part performance under Section 53A of the Transfer of Property Act. We are in agreement with the view as expressed by the said Division Bench case.

19. Another Division Bench consisting of Sen and Deo JJ. in Dammulal Babulal Jain v. Mohammad Bhai, AIR 1955 Nag 306 also expressed the opinion that an unregistered lease deed which was compulsorily registrable, could be used to prove the nature and character of possession as per the proviso to Section 49 of the Registration Act, and consequently for the purpose of establishing part performance as per Section 53A of the Transfer of Property Act. What is necessary is not the form in which the document should express itself to he on agreement of sale. What is really necessary is that there should be a writing evidencing the terms of the contract, which is signed and which suffers from the defect of want of registration. As such, there can be no doubt that an unregistered sale deed could be used for the purpose permissible under the proviso to Section 49 of the Registration Act, so as to establish part performance under Section 53A of the Transfer of Properly Act. We would reject the contention of the learned counsel for the first and the second respondents that such a document cannot be used for this purpose. We find it unnecessary to refer to the voluminous cases cited at the Bar, as we have no doubt that an unregistered draft sale deed, although not strictly in the form of an agreement would undoubtedly constitute a writing duly signed which evidences the terms of the contract. Therefore, we are of opinion that the requirement of the first clause are undoubtedly fulfilled. The further question is whether the requirements of the second clause are fulfilled.

20. It is evident that the case, if at all, will be governed by the second phrase of the second clause, as the appellant was already in possession as a mortgagee. The only question is whether he did some act in furtherance of the contract. It is the payment of Rs. 1000/-alone which is said to be in furtherance of the contract. In this connection, it is urged that the payment was actually made on 9-10-1950 and 10-10-1950 while the draft itself was scribed on 10-10-1950. Therefore, it is suggested by the learned counsel for the first and the second respondents that anything done anterior to the scribing of the draft cannot be considered to be an act in furtherance of the contract. It is contended that the act contemplated by the second phrase of the second clause should follow the contract. We may observe that the act envisaged by the said phrase should be in pursuance of the contract, and not that it should either precede or follow the agreement or the contract. That will be wholly immaterial. If It is in pursuance of the agreement or the contract, the fact that it may precede or follow the execution of the unregistered draft will not be relevant. It is true that where an agreement or a contract is made, the act should be done in pursuance of the same. For this purpose an oral agreement will not be enough as laid down by the Division Bench case of AIR 1938 Rang 356 (supra). Therefore, in the present case, it will be the unregistered written draft sale deed, which will be material for the purpose of ascertaining whether any act was done in pursuance of the contract. The first respondent's letter, dated 10-10-1950 (Ex. P. 5) clearly shows that the appellant was not liable to spend for execution of the sale deed. The sole responsibility was that of the first respondent. Therefore, he requested the appellant to advance a sum of Rs. 1000/- to cover the expenses, It was duly done by making the payment in two instalments This payment would undoubtedly be an act in pursuance of the contract which is evidenced by the writing (Ex. D. 1) duly signed by the first respondent. As such the appellant could claim that the second clause of Section 53A of the Transfer of Property Act was fulfilled; and if he ran rely on the doctrine of part performance, there can be no doubt that the equity of redemption would be extinguished as laid down by a Division Bench of this Court in Habib Miyan v. Mahmud Mir, 1959 MPLJ 368: (AIR 1959 Madh Pra 221).

21. In this connection, we may refer to the observations in Gopalan v. Eram Veettil Kanaran, AIR 1958 Mad 926, wherein it was agreed that Rs. 125/- should be recovered in lieu of the document to be executed. Payment was made in pursuance of the agreement. The learned Judge held that such payment would be an act in pursuance of the contract and would be sufficient to attract the doctrine of part performance under Section 53A of the Transfer of Property Act. In Batanlal v. Kishanlal, AIR 1952 Raj 141, Bapna J. also held that where a part payment towards the consideration of the deed was made and the draft deed was executed, that would be an act in furtherance of the contract, which will attract the doctrine of part performance. We may further refer to the observations of a Division Bench of the Madhya Bharat High Court presided over by Shinde C. J. and Dixit J. (as he then was) in Pannalal v. Labhchand, AIR 1955 Madh B. 49, wherein the learned Judges discussing the case law succinctly and exhaustively, held that if would not be correct to say that no payment of money can be an act in furtherance of the contract. The learned Judges laid down that if a connection be established by evidence between the payment and the contract in that event, the payment would be an unequivocal act referable to and in furtherance of the alleged contract. We are in agreement with the view expressed in the said case. Therefore, what is to be seen is whether there is connection established between the payment and the contract. If no such connection be established, any payment cannot be availed of to attract the doctrine of part performance. In the present case, the connection is clearly established, inasmuch as it was a term of the contract that the first respondent should bear the expenses of the sale deed, and he requested the appellant to advance the amount of Rs. 1000/- to meet those expenses. Therefore. this advance was made at the request of the first respondent, and cannot be considered to be a voluntary act on the part of the appellant. This payment was undoubtedly in pursuance of the terms of the contract, as it was the first respondent, who was liable to bear the expenses, which he was unable to meet but for the advance payment by the appellant.

22. The learned counsel for the first and the second respondents invited our attention to the observations of a Division Bench of the Rangoon High Court in Shira Khatoon v. Maung Pan, AIR 1939 Rang 206. In that case, the document sought to be used in support of the doctrine of part performance merely recited receipt of some advance payment and further recited that the payment should be within certain lime. The learned Judges held that the recital about advance payment and the subsequent payment to be made could not be said to be an act in pursuance of the contract of sale and, therefore, Section 53A of the Transfer of Property Act was not attracted In this connection, we may observe that as laid down by the Division Bench of the Madhya Bharat High Court in AIR 1955 Madh B. 49 (supra) no connection is established between the payment and the contract. Therefore, this case is clearly distinguishable and is not applicable to the facts of the present case.

23. Attention was further invited to the observations of Dixit J. (as he then was) in Kukaji v. Basantilal, (S) AIR 1955 Madh B. 93, wherein the learned Judge observed that any act preparatory to the completion of the contract or introductory to and previous to the agreement cannot be treated to be an act in furtherance of the contract so as to attract the doctrine of part performance. So far as that proposition is concerned, we are certainly in agreement with that view, which has been explained by the learned Judge in his exhaustive Division Bench case of AIR 1955 Madh B. 49 (supra). There can be no doubt that mere payment of earnest money or mere advance payment towards part price by itself will not amount to an act of par! performance, unless it is done in pursuance of the terms of the contract. In the present case, the part payment of Rs. 1000/-, as we have already indicated earlier, was in pursuance of the terms of the contract and for that reason this case is also distinguishable and the observations made therein will not help the case of the first and the second respondents but it is the Division Bench case of AIR 1955 Madh B. 49 (supra) that governs the present case.

24. The learned counsel for the first and the second respondents further invited our attention to the observations of Shrinivasachari J. in Jahangir Begum v. Gulam Ali Ahmed, AIR 1956 Hyd. 101, wherein the learned Judge observed that the acts of part performance, if they precede the contract, cannot be evidence of such part performance. The transferee must have done something in furtherance of the contract. There can be no quarrel with that proposition. We have already referred to the observations of Dixit J. in (S) AIR 1955 Madh B. 93 Therefore, the real test as suggested by Dixit J. is whether any connection is established between the payment and the contract, and whether the act sought to be invoked in support of the doctrine of part performance is merely preparatory or introductory to the contract Therefore, in our opinion, this case is also distinguishable.

25. To conclude, we are of opinion that the requirements of the second clause of Section 53A of the Transfer of Properly Act are fulfilled in the present case; and consequently, the appellant's claim based on the doctrine of part performance cannot he negatived on the assumption of non-compliance with the requirements of the second clause.

26. The next question is whether requirements of the third clause of Section 53A of the Transfer of Properly Act are fulfilled, namely, whether the transferee had performed or was willing to perform his part of the contract. This is the most material question in the present case, over which the learned counsel for both the parties advanced lengthy arguments.

27. It was further argued by the learned counsel for the first and the second respondents that there was no formal issue about the defendant's readiness and willingness to perform the remaining part of the contract. Therefore, it was urged that the question of readiness and willingness could not be considered, and all evidence regarding that should he excluded from consideration. There can be no quarrel with the proposition that there should be no findings beyond the pleadings, as laid down by Their Lordships of the Privy Council in Siddik Mahomed Shah v. Mt. Saran, AIR 1930 PC 57 (1) and by Their Lordships of the Supreme Court in Trojan and Co. v. Nagappa Chettiar, AIR 1958 SC 235. However, where parties understand the real implication of the points in dispute and lead evidence on such disputed questions, the findings will not be vitiated merely for want of a formal issue, as laid down by Their Lordships of the Supreme Court in Nagubai Ammal v. B. Shama Rao, (S) AIR 1956 SC 598. Therefore, we are of opinion that the parties understood the real points of dispute, and accordingly they led evidence which cannot be ruled out merely for want of a formal issue. The trial Judge did not consider this aspect, as, in his opinion, Section 58-A of the Act was not at all attracted. However, we are of opinion that this question can be considered in the light of the established facts on record and, therefore, we propose to consider the question of readiness and willingness on the part of the mortgagee to perform the remaining part of the contract.

28. In this connection, the learned counsel for the first and the second respondents advanced arguments on the assumption that all the tests applicable to a case of specific performance of contract should be applied to a case of part performance. Of course, the wording of the third clause Itself shows that the transferee should have either performed or should be willing to perform his part of the contract. Pointed attention was invited to the allegations in the written statement stressing that there was no offer on the part of the appellant to perform that part of the contract which remained unfulfilled, and hence the appellant was not entitled to Invoke the doctrine of part, performance. So far as the appellant's pleadings are concerned, he has merely stated facts asserting that the contract, was for sale of the mortgaged house for Rs. 80,000/-. Out of this amount, Rs. 25,000/- were to he adjusted towards settlement of the mortgage claim. Rs. 1000/- had been paid in advance to meet the expenses of the sale deed including stamp duty and registration charges. Rs. 6,265/-were to be paid at the time of registration, while the balance of Rs. 17,736/- had been kept with the defendant for satisfaction of the debts of the mortgagor owed to other creditors, including a small amount of Rs. 541/- due to the mortgagee. Mortgagor had got a deposit receipt executed by the defendant in this behalf for the purpose of facilitating payment of the debts of other creditors After stating these facts, the defendant asserted that he was entitled to part performance as per Section 58-A of the Transfer of Property Act. However, it is urged by the learned counsel for the first and the second respondents that there was no specific offer on the part of the defendant to pay up the balance of the consideration.

29. It is true that as observed by Mudholkar J. in Sobharam Jiwan v. Tolaram Sitaram, AIR 1952 Nag 244, as also in Narayan Pandurang v. Guru Prasad Narayan, AIR 1952 Nag 246, It is necessary for a person relying on part performance to plead that he has either fully performed the contract, or if any part of it remains unfulfilled, he is willing and ready to perform that part. The matter cannot be left to surmise or conjecture, but has to be pleaded and established. Bose J. in Pusaram v. Deorao, ILR (1946) Nag 991: (AIR 1947 Nag 188) recognised the need of pleadings on the point of part performance, as also the readiness and willingness of the person relying on part performance to perform the remaining contract, which has remained unfulfilled. The said view as expressed by Bose J. was relied on by Sharma J. in Bhagwandas Parsadilal v. Surajmal, AIR 1961 Madh P. 237. The matter was also considered in all its aspects exhaustively by Newaskar J. in Badrisingh v. Ramzankhan Second Appeal No. 155 of 1951, D/- 1-7-1957 (Madh Pra.). Therefore, it can be taken for granted that the consistent view of this Court has been, that there should be pleadings on the point of part performance, as also on the question of readiness and willingness on the part of the person claiming benefit of part performance. Applying these tests it is clear that the appellant had stated all the necessary facts, which would attract the doctrine of part performance. He also admitted that he was liable to pay certain amount towards that part of the contract, which remained unfulfilled due to the action of the mortgagor. There is nothing in the defendant's pleadings which would indicate a refusal on his part to perform the remaining part of the contract. Such performance can be imposed as a condition precedent to the appellant's right to hold the property in exercise of part performance. Therefore, we are of opinion that the requirements of the third clause of Section 53A of the Transfer of Property Act are substantially fulfilled, and the appellant had not rendered himself either incapable of or unwilling to perform the remaining part of the contract. This would dispose of the first question whether the appellant is entitled to invoke the doctrine of part performance and whether all the requirements of Section 53A of the Transfer of Properly Act have been fulfilled.

30. It was further pointed out by the learned counsel for the first and the second respondents that there was no contract, as there was no consideration within the meaning of Section 2(d) of the Contract Act, and there was no consent within the meaning of Section 13 of the Act because of the discrepancy between the application, dated 10-10-1960 (Ex. P. 5), and the letter, dated 9-10-1950 (Ex. P. 3), which indicated that an agreement of conditional sale was settled upon. It is true that the first respondent in his letter written to the appellant referred to an agreement of conditional sale. However, it is further clear that in his application to the registration officer, dated 10-10-1950 (Ex. P. 5), he unequivocally mentioned an unconditional sale deed. Therefore, it may be that the first respondent originally intended to effect a conditional sale, while ultimately he consented to execute, an unconditional sale deed. Otherwise, in the said application be would certainly have referred to a conditional sate deed. From these facts, it cannot be asserted by the first and the second respondents that there was no consideration within the meaning of Section 2(d), or that there was no consent within the meaning of Section 13 of the Act to the draft Sale deed (Ex. D. 1) executed in favour of the appellant. We reject that contention outright and think it unnecessary to refer to the voluminous case law cited on that point. There can be no doubt that for a valid contract, there must be consideration as also free consent, as laid down by Their Lordships of the Privy Council in Sunitibala Debi v. Manindra Chandra Roy, AIR 1930 PC 217. We may further observe that Their Lordships of the Supreme Court in the Union of India v. Kishorilal Gupta and Bros, AIR 1959 SC 1362, have laid down the principles regarding construction of deeds. There can be no quarrel with those propositions.

31. Coming to the second and the third questions raised by the learned counsel for the appellant, the same are necessarily based on the applicability or otherwise of the doctrine of part performance. These questions have no independent existence apart from the first question. Therefore, if the appellant cannot invoke the doctrine of part performance, tire accounts settled by fixing the mortgage amount at Rs. 25,000/- cannot be final. The settlement of account was not independent of a proposed sale in favour of the appellant. It was not a mere settlement of the mortgage liability: if was necessarily connected with and dependent on the execution of a sale in favour of the appellant. Therefore, we do not think it necessary to consider that question independently of the question of part performance Similarly, the third point raised by the learned counsel for the appellant that Gyarsilal got no title to the property is also solely dependent on the first question and need not he considered independently of that. Therefore, we consider a further discussion of these two questions wholly unnecessary in view of our finding on the first question.

32. This discussion would settle the case so far as the dispute between the appellant on the one hand and the first and the second respondents on the other hand is concerned. If the appellant is entitled to invoke the doctrine of part performance the first respondent will not be entitled to redeem the mortgage as that right was lost because of the contract of sale. It is also further clear that the second respondent cannot avail of the last provisit to Section 53A of the Transfer of Property Act, as he cannot claim to be a transferee for consideration who had no notice of the contract or of part performance. From the record it is abundantly clear that he was aware of the previous contract in favour of the appellant. Consequently, the appellant will be entitled to retain the property in exercise of his right of part performance on the condition that he fulfils the remaining part of the contract. From this point of view, there can be no doubt that the suit for redemption filed by respondents 1 and 2 is not tenable. But at the most they may insist on equities being worked out before the appellant is permitted to retain possession on the basis of part performance.

33. This then leaves the fourth point alone for consideration, which relates to the dispute between Motilal on the one hand and the appellant and the first and the second respondents on the other hand, Motilal being an auction purchaser, has claimed that neither the first and the second respondents are entitled to redeem the mortgage, nor are the appellant and the second respondent entitled to enforce their title on the basis of part performance or execution of the sale deed. This question will need detailed examination, as the third respondent. Motilal claims that the transactions in favour of the appellant and the second respondent look place during the pendency of the attachment in his favour in a suit filed by him for recovery of money against the first respondent Incidentally, this also involves the question whether the said respondent should be allowed to raise these questions at the appellate stage, particularly when he did not apply in the trial Court for being impleaded as a defendant.

34. It is necessary to recapitulate certain dates. Motilal had filed civil suit No. 223 of 1949 (a money claim) on 3-11-1947. He had secured attachment before judgment on 6-11-1947. His claim for Rs. 2500/- had been decreed by the trial Court on 8-8-1951. He filed an execution application on 27-8-1951, wherein he prayed for sale of the house which had been attached before judgment. The house was sold subject to mortgage and was auctioned for an amount of Rs. 3500/- in favour of one, Gulabchand. However, that sale was not confirmed, and a fresh proclamation was issued subsequently, because the amount of the mortgage encumbrance had not been correctly mentioned in the earlier proclamation. After a fresh proclamation which showed the encumbrance at Rs. 27,792/-, the auction was held in favour of Motilal for an amount of Rs. 300/; that being the highest bid. The auction was confirmed on 23-9-1.952 and a sale certificate was issued on 25-3-1968. These were the proceedings so far as they related to the execution side.

35. On the regular side, there was an appeal by Sardar Govindrao against the decree of the trial Court, dated 5-3-1951. That was civil regular appeal No. 125 of 1951. By judgment, dated 27-3-1953, the Additional District Judge allowed the appeal and dismissed the money claim of Motilal in its entirely

36. Against the appellate decree, Motilal and his sons filed Civil Second Appeal No. 78 of 1953 in the Madhya Bharat High Court; and by judgment dated 4-9-1958, Motilal's claim for Rs. 2600/- against Sardar Govindrao, along with interest and proportionate costs was decreed. It is to be noted that there is no direction in the judgment of the Additional District Judge or of the High Court regarding the auction sale, which had already been held on 28-8-1952. Can it be said that as a result of the .judgment of the Additional District Judge, dated 27-8-1953, the auction sale held in pursuance of the trial Court's decree, dated, 5-3-1951 would fall to the ground, as the plaintiff's claim had been dismissed in toto. The further question will be whether the auction sale is revived by the second appellate judgment, dated 4-9-1958 decreeing Motilal's claim for Rs. 500/-. A consideration of these questions will be necessary only after disposing of Motilal's application for being impleaded at the first appellate stage under Order 22, Rule 10, Civil Procedure Code.

37. It is further to be noted that the present suit was filed on 22-2-1951. Can it be said that Motilal was not aware of the present suit at all In his application, dated 2-4-1962 under Order 22 Rule 10, Civil Procedure Code filed in this Court, he has alleged that he came to know of the redemption suit being filed by Sardar Govindrao and Gyarsilal in December, 1961. This assertion is disputed by the first and the second respondents in their reply, dated 19-8-1963, who have alleged that Motilal was regularly attending Court in his own cases and as a Mukhtyar while the present suit was pending.

38. It would, therefore, be too much to believe Motilal's assertion that he came to know about the filing of the suit in December, 1961, only. He having allowed the proceedings to continue and not having made any earlier attempt to be impleaded as a party in the present suit, merely wants to take an off chance to join the litigation at a late stage in order to complicate matters by making it a triangular fight and to defeat the rights of not only the mortgagor, but also the mortgagee.

39. The learned counsel for Motilal invited our attention to the observations of Puranik J. in Wright Neville v. Freser, ILR (1944) Nag 520: (AIR 1944 Nag 137) laying down that there being no limitation prescribed for an application under Order 22 Rule 10 of the Civil Procedure Code, a transferee pendente lite could be allowed to be impleaded even at the appellate stage. It is true that as suggested by Puranik J., the discretion has to be exercised judicially and the fact that an application is made at the appellate stage is no bar to the allowing of a party to be impleaded at the appellate stage. However, the question will be one of due diligence. If a transferee is guilty of unreasonable delay and he waits and watches the proceedings without making an attempt to be impleaded, and later on he files an application at a very late stage, unless he explains the delay or shows some justifiable reason for having remained silent, his prayer to be impleaded at a late stage can evidently not be allowed. This case has been referred to with approval in Lakhshmi Narain v. Babu, AIR 1946 Lah 38 and T.K. Chakrapani Iyer v. Ammalu Amma, AIR 1949 Mad 870, We are in agreement with the observations made by the learned Judge; and while endorsing the same, we are of opinion that in the present case Motilal has been guilty of undue and unreasonable delay in applying for being impleaded at a late stage, although he was aware of the litigation and he merely watched and waited.

40. In this connection, we may further observe that Motilal, although aware of the litigation, as also the transfers of interest by Sardar Govindrao to different persons, kept silent and became a decree-holder auction purchaser in execution of his own decree for a nominal price of Rs. 300/-. He never approached the trial Court for being impleaded, and now he comes forward at the appellate stage to create complications and to have an academic decision regarding his right of redemption as against the mortgagor, the mortgagor's transferee and the mortgagee. So far as allowing a party to be impleaded under Order 1 Rule 10(2) of the Civil Procedure Code or Order 22 Rule 10, Civil Procedure Code or Order 41 Rule 20 of the Civil Procedure Code is concerned we are of opinion that the discretion has to be exercised by the Court judicially. Therefore, we are of opinion that the same principle can be applied to the present case as was done by a Single Bench of this Court in Goverdhandas Ramkumar Khandelwal v. Choudhari Chaitram Ghanshyamprasad, 1962 MPLJ 137, where the application of a stranger to be impleaded was rejected on the ground that the stranger wanted to have an academic decision and thereby create complications. In that view the stranger was left to seek his own remedy by filing a .separate suit Therefore, although ordinarily we might not be inclined to allow Motilal's request to be impleaded in this Court at the appellate stage, we are of opinion that it would be desirable to have a final decision about the various points of dispute between all the parties in order !o avoid further unnecessary litigation. From this point of view only, we would allow Motilal to be impleaded in the present litigation by addition of his name, and not by allowing him to replace both the plaintiffs. Therefore, we propose to examine his case on merits to decide as to what right he exactly got by his auction sale.

41. Section 64 of the Civil Procedure Code is invoked by Motilal to contend that the agreement in favour of the appellant and the transfer in favour of the second respondent being during the subsistence of attachment, the same would be void, as against the attaching creditor. So far as that proposition is concerned, it can admit of no doubt. In a series of cases, it has been laid down that any private alienation of properly during the subsistence of attachment would be void as against the attaching creditor, and the same cannot prejudice his rights as laid down in Dinobundhu Shaw Chowdhry v. Jogmaya Dasi, 29 Ind App. 9 (PC), Raghunath Das v. Sundar Das Khetri, 41 Ind App. 251: (AIR 1914 PC 120), which cases have been followed consistently by this Court in Laxminarayan v. Dinker, ILR (1943) Nag 390: (AIR 1943 Nag 101), Kundanbai v. Satyanarayan, ILR (1960) Nag 491: (AIR 1951 Nag 270), and Dashrathlal v. Anandkumar, ILR (1051) Nag 416: (AIR 1951 Nag 911). Therefore, there can be no doubt that Motilal at least is not bound by the agreement, dated 19-10-1950 in favour of the appellant or the sale deed, dated 14-10-1950 executed in favour of the second respondent. He can certainly enforce his rights as an auction purchaser despite these two alienations. But it is also further clear that he will be bound by the earlier mortgage, dated 26-11-1929; and unless he redeems the said mortgage, he would not be able to obtain possession of the properly. However, the question still remains as to what right exactly Motilal got by his auction purchase. Can it be said that the enquiry of redemption vested in him exclusively and the mortgagor and his transferee were divested of the equity of redemption altogether. In this connection, we may observe that although the agreement of sale and the actual sale deed in favour of the appellant and the second respondent might have taken place during the pendency of the attachment, they certainly look place before the actual auction. As sued, it cannot be stated that by the auction sale in favour of Motilal, the equity of redemption vested in him exclusively. At the most, his auction sate will create a right of having the decretal amount recovered from the property by way of enforcing a charge against the same even as against the appellant or the second respondent, whose agreement of sale or a sale look place during the subsistence of attachment. That right Motilal can always enforce, but in no case can he claim that the equity of redemption vests in him exclusively, and that all the interests of the mortgagor or his transferees are altogether wiped out. Motilal being hound by the mortgage cannot ignore the same, and his auction purchase at the most may amount to a charge over the properly enforceable against all other persons.

42. The learned counsel for the appellant, as also the first and the second respondent urged that although Motilal's money claim was decreed by the Court of first instance, his suit bad been dismissed by the Additional District Judge. As the suit itself bad been dismissed the auction sale could not validly continue in law. On the other hand, the learned counsel for the auction purchaser. Motilal urged that ultimately his claim had been decreed by the High Court and therefore, the auction sale held by the Court of first instance would be valid and subsisting.

43. In this connection, we might observe that. Their Lordships of the Supreme Court, in Bhagwantsingh v. Sri Kishen Das, AIR 1953 SC 136 have laid clown that upon reversal of a decree, an auction sale would not be automatically cancelled. The judgment debtor would have a right of restitution, if he could show that the auction sale could not have taken place even by a decree of reversal. In the present case the auction sale would undoubtedly have taken place in pursuance of the ultimate decree of the High Court. It is further significant to note that neither the Additional District Judge nor the High Court gave any directions regarding the auction sale which had already bean held on 23-8-1962. Consequently, applying the principle laid down by Their Lordships of the Supreme Court, we are of opinion that the auction sale did not fall to the ground, but remained a valid and subsisting auction sale so as to confer a good title on the auction purchaser resulting in creating a charge in his favour enforceable against all the parties to the present litigation.

44. As a result of the discussion aforesaid, we are of opinion that the appellant can rely on the doctrine of part performance as against the mortgagor, Govindrao and his transferee. Gyarsilal subject to the condition that he pays to the second respondent an amount of Rs. 24000- with interest at the Rule of Rs. 4/- per cent per annum from the date of delivery of possession to him as vendee till the date of payment or deposit, or deposits the same in the trial Court for payment to the second respondent within 3 months from today so as to entitle him to retain possession of the property by relying on the doctrine of part performance. If the deposit is made, the present appeal shall stand allowed. In that event, the appellant shall be entitled to his costs of this Court and the trial Court. If the deposit is not so made, the present appeal shall stand dismissed with costs of this Court and the trial Court. In either of the events, the auction purchaser, Motilal shall be entitled to recover balance of his decretal amount and interest at the rate of Rs. 4/- per cent per annum from the date of his auction sale till the date of realisation or deposit as the case may be either from the appellant or from the first and the second respondents, as the case may be. and that shall be a charge on the suit house, which shall he enforceable at the instance of Motilal by a sale of the property. However, as regards costs between Motilal and the other parties, we direct that there shall be no order as to costs, as Motilal unduly delayed the filing of the application for being impleaded us a party.

H.R. Krishnan, J.

45. I agree.


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