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Sri Raja Sobhanadri Appa Rao Bahadur Garu Vs. Raja Muganti Venkatarama Rao and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai
Decided On
Reported inAIR1931Mad45; 129Ind.Cas.245; (1931)60MLJ701
AppellantSri Raja Sobhanadri Appa Rao Bahadur Garu
RespondentRaja Muganti Venkatarama Rao and ors.
Cases Referred and Ramanathan Chettiar v. Mutkukumara Chettiar
Excerpt:
.....in the possession and enjoyment of the plaintiff's father. if the sale is held to be void owing to fraudulent registration then, of course, there will be no need to set it aside, and it is not disputed that the suit will have been brought well within the period of limitation. this finding, however, is not in accordance with plaintiff's own pleading which, as set out in the plaint, is not that this vundoor site was fictitious but that it belonged to and was being enjoyed by plaintiff's father and that the fraud consisted in including this item in the sale-deed when there was no intention of conveying it. we may also remark incidentally that we are not satisfied on the evidence that the vundoor site is a fictitious item. had the case for the plaintiff been that this item was fictitious and..........the suit under appeal is one for recovery of possession by the plaintiff from defendant 1 of the suit property which consists of one-fourth share in the mokhasa village of somavaram in the kistna district. according to the plaint, the plaintiff's father, professing to act as his guardian during his minority, purported to alienate, on 14th october, 1910, under a registered sale-deed, the suit property to the late father of defendants 1 and 2 for a cash consideration of rs. 27,302 which was quite inadequate, while the sale itself did not purport to be for any justifiable necessity. the suit property was in the possession of the father of defendants 1 and 2 till his death in or about may, 1911, and has been in the sole possession of defendant 1 since about september, 1918, when there was.....
Judgment:

Bardswell, J.

1. The suit under appeal is one for recovery of possession by the plaintiff from defendant 1 of the suit property which consists of one-fourth share in the Mokhasa village of Somavaram in the Kistna District. According to the plaint, the plaintiff's father, professing to act as his guardian during his minority, purported to alienate, on 14th October, 1910, under a registered sale-deed, the suit property to the late father of defendants 1 and 2 for a cash consideration of Rs. 27,302 which was quite inadequate, while the sale itself did not purport to be for any justifiable necessity. The suit property was in the possession of the father of defendants 1 and 2 till his death in or about May, 1911, and has been in the sole possession of defendant 1 since about September, 1918, when there was a partition between him and his brother defendant 2. The plaint further sets out that there was a fraud on the registration law in that there was included in the sale-deed a vacant land belonging, not to the plaintiff but to his father, which item was not intended to be sold, was never possessed or enjoyed by defendants 1 and 2 or their father and is still in the possession and enjoyment of the plaintiff's father. Its inclusion in the sale-deed was, according to the plaint, solely for the purpose of getting the sale-deed registered at an office in the Godavari District, instead of in the Kistna District. The idea in getting the document thus registered was to keep the matter from the knowledge of the plaintiff's grandfather and actual guardian the late Maharaja of Venkatagiri The learned Subordinate Judge has found that the consideration under the suit sale-deed, Ex. I, was adequate, and cannot say that plaintiff's natural father, who has been joined in the suit as defendant 4, was not his natural guardian at the time of the execution of that document. He has, however, further found that the sale in any case would not be binding on the plaintiff because it was not executed for his benefit, and that it was in fact void as there was a fraud upon the registration law in respect of it. He has therefore given a decree to the plaintiff for recovery of possession, together with mesne profits for three years before suit at the rate of Rs. 1,000 per annum. In this appeal, which is by defendant 1, the finding as to there having been a fraud on the registration law is attacked, and there are further contentions that the sale, as being one by a guardian, though not one of necessity, should be upheld as being beneficial to the minor's estate, and that the amount of mesne profits that have been allowed is excessive.

2. The most important point in the case is that of whether there has been a fraud on the registration law. The importance of the point is involved in the fact that upon its decision depends the decision of the further question of whether or no the suit has been brought in time. If the sale is held to be void owing to fraudulent registration then, of course, there will be no need to set it aside, and it is not disputed that the suit will have been brought well within the period of limitation. It is on these lines that the Lower Court has found the suit to be in time. But if the sale-deed is not found to be void then the suit has to be regarded as one for setting aside the sale-deed, even though no such relief has been sought for, in that possession cannot be obtained unless that document is set aside. That this is the position has been held by this Court in Raja Ramaswami v. Govindammal (1928) 56 M.L.J. 332, Now, under Article 44 of the First Schedule on the Limitation Act, the time allowed to a ward who has attained majority for setting aside a transfer of property effected by his guardian is three years from when he attains his majority. The plaint in this case, which was presented on 6th December, 1921, states the age of the plaintiff as about 27, and on that showing was brought far more than three years after his attainment of majority. In his evidence, indeed, as P.W. 1, he has represented, on 14th July, 1924, that he was aged only twenty-seven even then but he admitted that he could not give his age definitely, while from what he says it would appear that he was making under-estimate of it. Even, too, if what he said in his evidence could be accepted he must have been over twenty-three when the plaint was presented, and, as he was not a ward of Court, that would make the presentation over five years after the time when he became a major.

3. The Lower Court has. based its decision that there was a fraud on the registration law on its finding that the site at Vundoor, which was added in the sale-deed so as to make it registrable at Samalkota in the Godavari District whereas the registration office for the suit property is Tiruvur of the Kistna District, was a fictitious item which belonged neither to the plaintiff nor to his father. This finding, however, is not in accordance with plaintiff's own pleading which, as set out in the plaint, is not that this Vundoor site was fictitious but that it belonged to and was being enjoyed by plaintiff's father and that the fraud consisted in including this item in the sale-deed when there was no intention of conveying it. We may also remark incidentally that we are not satisfied on the evidence that the Vundoor site is a fictitious item. Had the case for the plaintiff been that this item was fictitious and had that case been made good, then, no doubt, the learned Subordinate Judge would have been correct in his view that there had been a fraud in accordance with the Privy Council decision in Harendra Lal Roy Chowdhuri v. Hari Dasi Debi . As things stand the learned Advocate-General contends, on behalf of plaintiff, that it is open to him to show and, that being granted, that he can establish that, irrespective of any question of a fictitious entry, there has been a fraud on the registration law. Taking it that he can argue on these lines we have to see whether he has made good his case in this' connection.

4. The law on the subject may first be considered. In Harendra Lal Roy Chowdhuri v. Hari Dasi Debi the Privy Council has stated that a fictitious entry

intentionally made use of by the parties for the purpose of obtaining registration in a district where ho part of the property actually charged and intended to be charged in fact exists is a fraud on the registration law, and no Registration obtained by means thereof is valid.

5. Following this case there is the later Privy Council decision in Biswanath Prasad v. Chandra Narayan Chowdhury , in which the principle of the earlier decision was extended to the case of a mortgage bond in which property that actually existed was included without the mortgagor having any interest in it or the parties to the instrument having ever any intention that it should form part of the security. There has been a number of cases in this Court in which the principle underlying these decisions has been considered. In Kunhi Sankaran Nambiar v. Narayanan Tirumunpu I.L.R. (1919) M. 405 : 38 M.L.J. 251 it was held that there was no fraud of the registration Jaw where a second item was added in a mortgage-deed, not so much to give an additional security as to enable the mortgagor to get the document registered near where he was living. It was found that, whatever the original intention of the parties, they had deliberately included the second item in the mortgage and that its inclusion was not with the object of effecting a fraud on the registration law. Another case of this Court of the same year is Narasimha Rao v. Papunna I.L.R. (1919) M. 436 : 38 M.L.J. 327 in which it was held that when a cent of land was included purely for the purpose of getting the deed registered by a particular Sub-Registrar, without any intention of passing title to the vendee, there was a fraud on the registration law. This decision, it may be noted, was passed, not with reference to the size of the property in question but only on a consideration of what was the intention of the parties with reference to it. In Ramanathan Chettiar v. Muthukumara Pillai (1920) M.W.N. 487 it was held that where the parties to a mortgage-deed intended a particular property, however small in value as compared with the rest, to be part of the security, although the motive for its inclusion might be mainly that the document should be registered by a particular Sub-Registrar, that motive could not be said in any way to be a fraud or violation of the Registration Act. This decision follows that of the Privy Council in Hari Ram v. Sheodayal, Mal , according to which the words 'some portion of the property' in Section 28 of the Registration Act are not to be read as meaning some substantial portion of the property. In Rama Raff v. Vedayya I.L.R. (1922) M. 435 : 44 M.L.J. 373 it was held that the inclusion of an item in a mortgage-deed merely in order that the registration might be by a particular Sub-Registrar was a fraud on the registration law, but in this case it appears that the item of property in question did not belong to the mortgagor. In Venkata Lakshmikantharaju Garu v. Venkata Jagannatha Raju Garu (1923) 46 M.L.J. 12 the decision was that the fact that an item of property within the jurisdiction of a registration district where a document of mortgage was registered did not belong to the mortgagor would not invalidate the registration of the mortgage as a fraud on the registration law, unless it were shown that the mortgagor and mortgagee colluded to insert the item in the mortgage-deed with the knowledge that the mortgagor had no title to it. The decision in Marina Ammayi v. Sundayya : AIR1929Mad432 is to a similar effect, while in Chokkalingam Chettiar v. Athappa Chettiar I.L.R. 50 (1927) M. 800 : 53 M.L.J. 364 it has been held that where a person bona fide buys property for the purpose of facilitating registration of a transaction and also bona fide includes it in a sale or mortgage, he cannot be held to commit a fraud on registration which would render the whole transaction invalid. Rulings of the Bombay, Patna and Allahabad High Courts have also been cited before us in this connection. In Viswanath Bhat v. Mallappa I.L.R. (1925) Bom. 821 it was held that there could be no enquiry as to an alleged intention of the parties that an item of property which was included in a document so as to give jurisdiction to a particular Sub-Registrar was to be reconveyed. In Mussammat Jasoda Kuer v. Janak Missir I.L.R. (1924) Pat. 394 it is remarked that Section 28 of the Registration Act requires no more than the existence of a property within the jurisdiction of a particular Sub-Registrar in order to entitle him to register a document in respect thereof, which remark must be read with the context which shows that the conveyor appeared bona fide to believe that he had a title to convey in this property and that it did not seem that there could be any idea of defrauding any one in having the registration effected in a particular office. The decision in Durga Prasad Sahu v. Tameshar Prasad I.L.R. (1924) A. 754 inclined to the view that even if it was a fact, which it was not found to be, that an item which existed and belonged to the vendor was inserted in a document merely for the sake of registration, that would not constitute a fraud on the law of registration.

6. The general effect of all these decisions is that to establish fraud on the registration law there must be a collusion between parties to practise a fraud upon the registering officer, and that, as a test of whether the parties had an intention to practise such a fraud, it has primarily to be considered whether there was a property that could be conveyed by the party executant or as to which a genuine belief existed that he could convey it. Another point to be considered is whether there was any intention on the part of the parties that it should be conveyed to the executee, though it is not perfectly clear that it will follow as a matter of course that a fraud on the registration law has to be deduced from the absence of such intention. The facts that the property is small or that the primary intention was that registration should be in a particular office will not in themselves constitute acts of fraud. [His Lordship then discussed the evidence and continued as follows:]

7. The learned Advocate-General admits that the burden is on him to show that there has been a fraud on the law of registration. In the light of what is stated above we do not find that he has discharged the burden. The Vundoor site is one that actually exists; the title to it was in plaintiff's father who seems to have been its actual owner; it is not clear that there was no intention of passing possession of the item; and it is not shown that the parties had any reasor that would make them practise a fraud on the registering officer. It follows, then, that Ex. I is a document which the plaintiff had to get set aside and that, as he did not bring this suit till more than three years after his attainment of majority, the suit fails as being out of time. [His Lordship then dealt with the questions regarding the binding nature of the alienation and the amount of mesne profits which would have been payable to the plaintiff in the event of his success, which, in view of their Lordships' finding on the question of limitation, are not material for purpose of the report.]

8. In view of our finding on the point of limitation the appeal is allowed and the suit is dismissed with costs to the appellant against the plaintiff both in this Court and in the Court below. The finding stated above in paragraphs 15 and, 16 will be embodied in the decree.

Wallace, J.

9. I agree.

10. I only wish to add a few words on the legal point. Section 28 of the Indian Registration Act is no doubt mandatory, and the question for decision under that section is 'Is any portion of the property to which the document relates situate within the registration sub-district'? When property to which the document relates is non-existent Section 28 has not been complied with (Harendra Lal Roy Chowdhuri v. Hari Dasi Debi ). And where the document does not relate to certain property because the parties to it did not intend it so to relate, Section 28 has not been complied with (Biswanath Prasad v. Chandra Narayan Chowdhuri ). In both cases there must be a collusion between both parties to the document to deceive the Registration authorities, in fraud or violation of Section 28 of the Act. (See Venkata Lakshmikantharaju Garu v. Peda Venkata Jagannatha Raju Garu (1923) 46 M.L.J. 12). It is important to note that not intending the document to relate to certain, property is not the same thing as not intending to transfer that property or title thereto by means of the document. Otherwise all documents of benami transfer would be void by force of Section 28. However desirable in theory such a conclusion may be, it is not at present the law, which has always recognised the validity of benami documents. Section 28 will not invalidate a benami document, because the parties to such a document do intend that it shall relate, so far as it has validity, to the property mentioned in it, and therefore are not colluding to deceive the Registration authorities.

11. When therefore the contention is raised that the inclusion in a registrable document of a particular piece of property was merely for the purpose of giving jurisdiction to the Registrar, the true test whether Section 28 has not been complied with, will be, in cases where the parties intend the document to be a deed of real transfer, did they collude in intending that that piece of property should not pass (see Narasimha Rao v. Papuwia I.L.R. (1919) M. 436 : 38 M.L.J. 327 and Rama Rao v. Vedayya I.L.R. (1922) M. 435 : 44 M.L.J. 373) ; and in cases where the parties intend the document to be nominal or benami, did they collude in intending it not to apply, so far as it has validity, to that piece of property. The test for both cases is, did the parties, in including that property, intend to deceive the Registration authorities, and so escape the mischief of Section 28? (See Kunhi Sankaran Nambiar, v. Narayanan Tirumunpu I.L.R. (1919) M. 405 : 38 M.L.J. 251, Chokkalingam Chettiar v. Athappa Chettiar I.L.R. (1927) M. 800 : 53 M.L.J. 364 and Ramanathan Chettiar v. Mutkukumara Chettiar (1920) M.W.N. 487).


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