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Ghanashyam Rath Vs. Udayanath Naik - Court Judgment

LegalCrystal Citation
CourtOrissa
Decided On
Reported inAIR1949Ori14
AppellantGhanashyam Rath
RespondentUdayanath Naik
Cases ReferredDwarka Nath Ash v. Priya Nath A.I.R.
Excerpt:
.....union of india v smt gita banik, 1996 (2) glt 246, are not good law]. - in accordance with the sale-deed, the dues claimed in this suit should have been treated as satisfied but, for some reason, the suit went on, being finally dismissed on 23rd april 1942. 3. the case of the plaintiff is that udayanath naik took no steps to pay the dues of the landlords and of the plaintiff under his mortgage, and did not even pay the amount of rs. on these allegations, the plaintiff sought to redeem the usufructuary mortgage of 7th december 1985. 4. the case was contested by udayanath substantially on the ground that a good title had passed to him under the sale-deed (ex. fourthly, that under section 54, contract act, udayanath, having failed to perform his part of the contract, cannot claim title..........property. the property in suit belonged to one bhagwan patra, who, on 9th july 1941, executed a sale deed (ex. a) for rs. 630 purporting to transfer it to udayanath naik (defendant). the consideration was made up as follows left with udayanath naik to be paidto the present plaintiff in order redeema amortgage affecting some other property... rs, 200left with udayanath naik to satisfydemands for rent due to different land-lords: 80amount settled as due to udayanathnaik on account of previous transactionsbetween the parties: 283to be paid in cash: 67_____________total: rs. 630.the previous transactions between the parties included a usufructuary mortgage affecting the suit property executed on 7th december 1935 and a loan of rs. 49 taken by bhagwan pawa on 25th november 1936. the.....
Judgment:

Reuben, J.

1. This appeal is directed against a decision of the Subordinate Judge of Cuttack, dated 26th July 1944, reversing a decision of the Munsif of Kendrapara, dated 13th July 1943. It raises a question which has friend the subject of several decisions of this Court in its Cuttack Circuit: vide Rasihananda Mallik v. Gangadhar Panaa 1 cut. L.T. 19 and Maheswar Mahanty v. Dayanidhi Mahanty 1 cut L.T 12. Narayan Sahu 1 Cut. L.T. 19 and Badhamohan Thakur v. Bipin Behari A.I.R 1938 Pat 505.

2. The appellant is the plaintiff. The suit was filed as a suit for the declaration of his title to and for the recovery of possession of the property in suit, but it is really an action for the redemption of a mortgage affecting that property. The property in suit belonged to one Bhagwan Patra, who, on 9th July 1941, executed a sale deed (EX. A) for RS. 630 purporting to transfer it to Udayanath Naik (defendant). The consideration was made up as follows

Left with Udayanath Naik to be paidto the present plaintiff in order redeema amortgage affecting some other property... Rs, 200Left with Udayanath Naik to satisfydemands for rent due to different land-lords: 80Amount settled as due to UdayanathNaik on account of previous transactionsbetween the parties: 283To be paid in cash: 67_____________Total: Rs. 630.The previous transactions between the parties included a usufructuary mortgage affecting the suit property executed on 7th December 1935 and a loan of RS. 49 taken by Bhagwan Pawa on 25th November 1936. The mortgage is the transaction sought to be redeemed in the present suit. In respect of the loan of Rs. 49 a suit filed by Udayanath Naik on 3rd July 1941 was pending when the sale-deed (EX. A) was executed. In accordance with the sale-deed, the dues claimed in this suit should have been treated as satisfied but, for some reason, the suit went on, being finally dismissed on 23rd April 1942.

3. The case of the plaintiff is that Udayanath Naik took no steps to pay the dues of the landlords and of the plaintiff under his mortgage, and did not even pay the amount of Rs. 67 to Bhagawan Patra and, therefore, on 15th October 1941, the latter sent him a notice intimating that, if he did not act in accordance with the contract, the sale-deed would be cancelled. In spite of the receipt of the notice, Udayanath Naik took no steps and, therefore, on 11th November 1941, Bhagawan' Fatra executed a second sale-deed by which he purported to transfer the same property to the present plaintiff. On these allegations, the plaintiff sought to redeem the usufructuary mortgage of 7th December 1985.

4. The case was contested by Udayanath substantially on the ground that a good title had passed to him under the sale-deed (Ex. A), and that he was unable to comply with the terms of the sale-deed on account of incorrect recitals regarding the debts due. According to him, the landlords' dues on account of rent amounted to Rs. 106 odd; he paid this amount but was unable to redeem the mortgage of the plaintiff, because Bhagawan Patra refused to pay the deficit amount of Rs. 26. He also challenged the genuineness of the sale-deed of nth November 1941, alleging that it is a fictitious transaction based on no consideration. We are not concerned with this aspect of the case.

5. The Munsif decreed the suit holding that the intention of the parties to the sale-deed (EX. A) was that title would not pass until the full consideration money was paid and, therefore, that Udayanath did not acquire any title under it. The Subordinate Judge came to the contrary conclusion and reversed the decision of the Munsif. Hence, the present appeal.

6. Mr. Das Gupta on behalf of the appellant has, urged : Firstly, that the ordinary presumption relating to a deed of sale affecting immovable property is that title passes only when the consideration is paid in full; secondly, that, on the true construction of the sale-deed (Ex. A), the intention is clear that title will pass on payment of full consideration; thirdly, that, if the sale-deed is held to be ambiguous upon this point, the extraneous evidence upon the record is sufficient to establish that this was the intention of the parties; fourthly, that under Section 54, Contract Act, Udayanath, having failed to perform his part of the contract, cannot claim title to the property under the contract fifthly, that, when a part of the consideration money for a sale is left with the vendee for satisfying the dues of third parties, a resulting trust comes into existence and, if the vendee does not fulfil the requirements of that trust he % cannot take a benefit under the contract; and sixthly, that, by reason of his conduct, Udayanath is barred from asserting title under the sale-deed (Ex. A).

7. It is too late now to urge that the ordinary presumption in a contract of sale affecting immovable property is that title is to pass only when the consideration is paid in full. It has repeatedly been laid down by this Court that, in the absence of some provision in the sale-deed to the contrary, title passes with the execution and registration of the sale deed: vide Ramdhari Rai v. Gorahh Rai A.I.R.1931 Pat. 236 Badhamohan Thahur A.I.R.1938 Pat. 505. Sheikh Sultan Ahmad v. Maksad Hussain A.I.R.1944 Pat. 3 and Pirtam Singh v. Jagannath Sarawgi A.I.R. 1947 Pat. 1. There may also be a separate oraL, agreement postponing the passing of title videl proviso (3) to Section 92, Evidence Act), but no such agreement is alleged in this case. Mr Das Gupta in support of his contention relies upon Sub-clause (b) of Clause (5) of Section 55, T.P. Act. This merely lays down the vendee's duty when the sale is complete and fixes a starting point for limitation for the recovery of the consideration money payable by him. It is not without significance that this provision speaks of the completion of the sale, in contrast to Sub-clause (b) of Clause (4), and Sub-clause (c) and (d) of Clause (5) and Sub-clause (a) of Clause (6) of this section, all of which relate to the passing of the ownership of the property. Evidently, Sub-clause (b) of Clause (5) is not a provision affecting the passing of title under the sale-deed. This disposes of the first point and I come to the second point.

8. It is well settled that the agreement as to when title will pass is a term of the contract and must be ascertained from the terms of the document itself; extraneous evidence is only admissible if they are ambiguous. This rule was emphasised by Courtney-Terrell C.J., in Badhamohan Thakur A.I.R.1988 Pat. 605 and he has made some very pertinent remarks about the admissibility of extraneous evidence, which I reproduce and with which I would respectfully express my agreement:

This question of whether in giving effect to a sale deed the property is to pass on the execution and registration of the deed or whether it is to pass upon the full payment of the consideration money arises somewhat frequently, and has given rise to various cases in this particular Court and I venture to think that the correct principle should he stated. The learned Sub ordinate Judge was under the impression that there was a conflict of view between the ease of Rasikananda Mallick v. Gangadhar Panda 1 Cut. L.T. 1 in which I delivered the judgment and the subsequent case of Maheswar Mahanty v. Dayanidhi Mahanty 1 Cut. L.T. 12. There is no conflict of any sort. In a contract of this character there is contained a recital of the receipt of the purchase money. There are also terms which provide for the passing of the property. This strictly contractual part, that is to say, the arrangement between the parties as to when the property shall pass is, if the contract has been reduced to writing, to be determined solely from the words of the writing and evidence is not admissible for the purpose, as mentioned in Section 92, of 'contradicting, varying, adding to or subtracting from its terms'. The question when the property is to pass is a matter of contract. In that respect it differs from the recital of fact, that is to say, the passing of the consideration which is not a matter of contract but a matter of fact. If the terms of the contract as to when the property is to pass are ambiguous, then recourse may be had to external evidence with a view to determining what the intention of the parties was: but if the intention of the parties has been stated in unambiguous terms, those terms must remain the sole criterion of the intention of the parties. As a rule contracts are so drawn that the property passes on the completion of the contract by registration and if one of the parties wishes to show that the contract has not that effect, he must do one of two things: either he must show that the contract on its correct wording is in accordance with the terms which he suggests or he must show that the contract is ambiguous in its terms capable of either meaning and it is for him to show by external evidence that the intention of the parties was that the property should pass not on the execution and registration of the document but on the happening of some other event.After referring to the decision of Fazl Ali J in Maheswar Mahanty 1 Cut. L.T. 12, his Lord, ship continued:

The decision with which I respectfully agree says that Section 92 will not prevent a party from disputing the recitals in the deed. Thus, if the vendor should decide, not having received his purchase money, to sue for the purchase money, he will not be overcome by the fact that the document stated that the whole of the consideration money was paid as preventing him from raising a point in a suit for recovery of purchase money that had not been paid. It is certainly true, as Eazl Ali J. has said that there is nothing in Section 92 which prevents a person from adducing evidence for the purpose of showing that the recitals were untrue. Statements of facts are different from the nature of the contract between the the parties which must be determined from a reading of the document itself. If the document is ambiguous in character, then certainly reference can be made to evidence for the purpose of ascertaining what the intention of the parties was. If, on the other hand, the contract is unambiguous in its terms then you cannot introduce evidence for the purpose of showing that the contract means something other than what it expresses in unambiguous terms.' Extraneous evidence as to the withholding of the sale-deed or as to the actual passing of consideration is entirely irrelevant at this stage and we have to consider the sale-deed on its own terms as they stand.9. Let us now see what the terms of the sale deed are. I set them out below in accordance with a translation of the deed furnished to me by Mr. Das Gupta:

All the dues of you, the creditor purchaser, against me having been settled at Rs. 283 and the dues of the simple mortgagee creditor Ghana Bath having been settled at Rs. 200 and the decretal dues of the landlord Padma Charan Mohanty obtained in 1940-41 and put in execution in Execution Case No. 4801 having been settled at Rs. 80 and the dues of Panjab Bay put in Execution Case No. 2787 of 1940-41 being settled at Rs. 20 thus being in need of money in order to pay up the aforesaid dues of Rs. 563 and to meet the maintenance expenses of my family and to pay up other creditors, I today find no other means than to sell out of my own free will 1.20 acres of land with all rights appurtenant thereto for a consideration of Rs. 630 and on receiving the sum of Rs. 283, (viz., the dues of the purchaser including the suit amount and the amount not covered by the suit), the sum of Rs, 200 due to Ghana Bath and the sum of Rs. 80 due to the landlords, i.e. a total of Rs. 563 by way of set off and the balance sum of Rs. 67 in cash I make you, the purchaser, the owner and in possession of the property. From today you and your heirs from generation to generation will become maliks in possession and will pay the dues of the landlords in the landlord's sarishta, having mutated your name in my place and you will do whatever you please. I and my heirs in this respect shall have no claim or objection, nor shall we raise any and if we do raise any it shall be rejected.10. Beading these words as they stand, the meaning is clear, namely, that the vendor has received the consideration and has transferred his interest in the property; the transaction is a completed one. Great reliance has been placed by Mr. Das Gupta on the decision of Courtney-Terrell C.J. and James J. in Rasikananda Mallick 1 Cut. L.T. 1, where the relevant provision of the sale-deed was in the following terms:

After taking from you the balance of Rs. 900 in cash we make you owner in possession thereof and ourselves become from to-day destitute of ownership thereof.Their Lordships construed these words as indicating the intention of the parties that the title would pass only after the full consideration was paid. To me it appears that the document before me is more in line with the sale-deed which came under the consideration of Pazl Ali J. in Maheswar Mahanty 1 Cut. L.T. 12:

We take the balance of the consideration of Rupees 269-12-0 in cash hand to hand (nagad dust badust) from the vendee and execute this sale deed agreeing therein that from today the vendee will be malik in the Baid Zamindary interest with nij chas and nij jote appertaining thereto.His Lordship held that the intention was to pass the title at once, although it was admitted that out of a total consideration of RS. 300 only Rs. 3-4-0 (Quare, Rs. 30-4-0) had been paid. In Badhamohan Thakur A.I.R. 1938 pat. 605, Courtney-Terrell C. J. and James J. pointed out that there is no conflict between the two previously mentioned decisions, and stresssed the fact that in the earlier case the sale-deed was clear that the transfer of title would take place after the payment of consideration: vide Badhamohan Thahur A.I.R. 1938 Pat. 505. It would appear that their Lordships in the earlier case were impressed by the use of the word 'after.' In the sale-deed before me there is no such word. What it says is that the vendor having received the consideration in full is transferring the interest. Then follows the provision that from 'to-day' the vendee will be the owner, will pay the landlord's dues and get his name mutated. Can it be doubted, in the absence of extraneous evidence, that this presents a picture of a sale in which the interest has passed? Of course, if it is a fact that the consideration has not been paid in full, it is open to the vendor to prove this and to take legal steps to recover his dues as has been explained by Courtney-Terrell C.J. But the fact of the non-payment of consideration is irrelevant to the question whether the title was intended to pass immediately on execution and registration or not. I would, therefore, decide this point against the appellant.

10A. Even if we treat the document as ambiguous and admit extraneous evidence, the case of the appellant is not improved. The ascertainment of the intention of parties then becomes a question of fact, and the finding of the final Court of fact is binding upon me. There was an agreement between the parties that the sale-deed would not be delivered till Udayanath's mortgage bond duly endorsed as satisfied was returned to Bhagawan Patra. In the opinion of the Subordinate Judge, this is not sufficient to support a finding that the intention was to postpone the passing of title till the payment of consideration--an opinion supported by authority: vide Narayan Sahu 1 Cut. L.T. 19. In particular the Subordinate Judge pointed out that the endorsement of the mortgage bond was a formal matter, as there is a recital of satisfaction in the sale-deed itself. The third contention, therefore, fails.

11. There is no force in the contention based upon Section 54, Contract Act. That section relates to a contract consisting of reciprocal promises', such that one cannot be performed or its performance cannot be claimed till the other has been performed. Here, we are concerned with a contract where one part, the passing of title, is completely independent of the performance of the other part, the payment in full of the consideration money. Mr. Das Gupta has referred me to certain remarks of Courtney-Terrell C.J. in Rasikananda Mallick 1 Cut. L.T. 1, but those remarks were made in relation to a contract which by its terms provided that title would pass after the consideration was paid in full.

12. For his next contention Mr. Das Gupta relies on Dwarka Nath Ash v. Priya Nath A.I.R.1918 Cal. 941. That decision is an authority that where the whole or any portion of the consideration for a sale is left with the vendee to be paid to a creditor of the vendor the vendee becomes a trustee of the creditor in respect of the money left in his hands, and the creditor can enforce the trust though he was no party to the sale. The trust, be it observed, affects the money. There is no support in this decision for the proposition that a failure to carry out the trust will avoid the title to the property, already legally vested in the vendee. Further, it has been found by the Subordinate Judge that Udayanath has paid to Bhagwan Patra the cash amount agreed upon, that he has also paid the rents due to the landlord and was prevented from paying the debts due to the plaintiff because Bhagwan would not contribute the excess amount due. He has also found that the amount claimed by the plaintiff as due to him from Bhagwan was Rs. 350 and not Rs. 200 as recited in the sale-deed. In these circumstances, if there was any power to forfeit the title, there would be no reason for imposing the penalty on Udayanath.

13. For his final contention Mr. Das Gupta refers to the conduct of Udayanath as appearing from his prosecution of the suit based on the bond for RS. 49. The suit was filed on 3rd July 1941, a few days before the sale deed (Ex. A) was executed; at the same time Udayanath prayed for the attachment under Order 38, Civil P.C. of the property which is the subject-matter of the present litigation. He persisted in the suit after the execution of the sale-deed. On 6th August 1941, the service of the writ of attachment was proved and on 1st September 1941, the attachment was made absolute. The sale in favour of the present plaintiff took place on 11th November 1941, and on 19th November 1941, Bhagwan Patra filed a written statement relating the facts-about the execution of the sale-deed (Ex. A) and its cancellation, and stating that the dues of Udayanath on the bond in suit had been settled at Rs. 65 and would be paid out of the consideration for the sale-deed executed in favour of the present plaintiff. Still, the suit dragged on till, on 23rd April 1942, Udayanath requested the Court by a petition (Ex. 2) to dispose of the suit 'on full satisfaction in the light of the written statement of the defendant.' Thereupon, the Court dismissed the suit. It is difficult to under-stand what Udayanath meant by this last petition, and we must accept the interpretation put by the lower appellate Court on this piece of evidence; namely, that Udayanath wanted his dues under the bond to be treated as satisfied by the execution of the sale deed (EX. A). Even so his conduct in persisting with this suit was very foolish. It is useless to conjecture what his motive was. However unjustifiable his conduct, it is difficult to see how it could divest a title which had legally vested in him.

14. Mr. Das Gupta bas stressed Udayanath's attachment of the property under Order 38. By this conduct, he argues, Udayanath treated the property as still belonging to Bhagwan, and thus acquiesced in the transfer to the present plaintiff. I do not find any suggestion that his conduct misled anyone so as to found an estoppel.

15. On the above grounds, I would decide this point also against the appellant.

16. In the result, the appeal fails and is dismissed with costs.


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