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The Melur Co-operative Marketing Society Vs. Salia Maniam and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai High Court
Decided On
Case NumberSecond Appeal No. 1327 of 1968
Judge
Reported inAIR1974Mad30
ActsTransfer of Property Act - Sections 54
AppellantThe Melur Co-operative Marketing Society
RespondentSalia Maniam and ors.
Cases ReferredKrishnamma v. Mali
Excerpt:
.....intention of parties was that title should pass on to plaintiffs even without payment of full sale consideration - under aforesaid agreement intention of parties was that title should pass on to plaintiff and balance of sale consideration was to be paid at time of registration - payment was not condition precedent before passing of title - court not to go beyond terms of agreement to find out intention of parties - held, payment of entire sale consideration not condition precedent for passing of title. - - he also stated that though he was put in possession of the properties, he was put in possession of the properties, he was dispossessed by the defendants in august, 1958. 2. the suit was resisted mainly by the fourth defendant contending inter alia that title did not pass in..........defendant), manian and minor mohammed uthirif. though her sons had no title to the properties, a sale deed was written on 18-3-1955 (ex. a-1) in which the vendors were the first defendant and her three sons, the first defendant acting for herself and as guardian of the said minor. but the document was signed only by the first defendant for herself and as guardian for her minor son and the second defendant. the sale was for rs. 2450. the document inter alia recited that the vendors had received rs. 530 on the date of the execution of the sale deed and that the balance of the consideration, namely, rs. 1,900, would be received in the presence of the sub-registrar at the time of the registration of the sale deed. on 16-5-1955, the first defendant issued the notice ex. b-1 to the plaintiff.....
Judgment:

1. The fourth defendant in O.S. No. 335 of 1965 on the file of the District Munsif, Melur, is the appellant in this second appeal. The suit properties consisting of three items of wet lands belonged to the first defendant Nainammal. The first defendant has three sons, and they are, Masthan (the second defendant), Manian and minor Mohammed Uthirif. Though her sons had no title to the properties, a sale deed was written on 18-3-1955 (Ex. A-1) in which the vendors were the first defendant and her three sons, the first defendant acting for herself and as guardian of the said minor. But the document was signed only by the first defendant for herself and as guardian for her minor son and the second defendant. The sale was for Rs. 2450. The document inter alia recited that the vendors had received Rs. 530 on the date of the execution of the sale deed and that the balance of the consideration, namely, Rs. 1,900, would be received in the presence of the Sub-Registrar at the time of the registration of the sale deed. On 16-5-1955, the first defendant issued the notice Ex. B-1 to the plaintiff stating that the agreement was that the sale should be completed within a week after the execution of the sale deed, that the first defendant was ready and willing to have the document registered on receipt of the balance of the consideration and that the plaintiff should pay the said balance at the time of the registration of the document and complete the transaction. On 16-7-1955, the plaintiff presented the document before the Sub-Registrar, Melur. Notices were issued to defendants 1 and 2, who appeared before the Sub-Registrar and admitted execution, but stated that inasmuch as the plaintiff was not willing to pay the sum of Rs. 1900 they were not willing for the registration of the document. Inasmuch as execution was admitted, the Sub-Registrar registered the document on 18-7-1955. On that date itself, the first defendant purported to cancel the sale deed Ex. A-1 by executing the cancellation deed Ex. B-7. On 10-9-1957, she executed a usufructuary mortgage over the suit properties in favour of the third defendant under Ex. P-8. On 7-12-1962 she sold the suit properties in favour of the fourth defendant, the appellant herein, under Ex. B-10, directing discharge of the aforesaid debt. The plaintiff laid this suit on 29-9-1965 praying for a declaration of his title to the suit properties and for recovery of possession of the same with mesne profits. he contended that he did not pay the balance sale consideration and dispute was raised with regard to the title by one Jamal Mohideen and that he was prepared to deposit the balance of the sale consideration. He also stated that though he was put in possession of the properties, he was put in possession of the properties, he was dispossessed by the defendants in August, 1958.

2. The suit was resisted mainly by the fourth defendant contending inter alia that title did not pass in favour of the plaintiff as the intention was that payment of the entire consideration was condition precedent for conferment of title on the plaintiff and that as the plaintiff failed to pay the amount in spite of demand by the first defendant, the first defendant was competent to execute the sale in favour of the fourth defendant.

3. The trial Court accepted the defence of the fourth defendant and dismissed the suit. The lower appellate Court took a different view holding that non-payment of the balance of consideration was not material and did not affect the passing of title in favour of the plaintiff and that title passed in favour of the plaintiff on the execution of the sale deed and registration thereof. In that view, the suit was decreed with costs, and the appellate Court directed the trial Court to determine the mesne profits claimed by the plaintiff. The appeal is directed against that decision.

4. The only question that arises for consideration is whether, under the terms of Ex. A-1, the intention of the parties was that payment of the entire consideration was the condition precedent for the passing of the title in favour of the plaintiff or whether, in spite of non-payment of the balance of sale consideration, the intention was that title should pass to the plaintiff. 'Sale' is defined in Section 54 of the Transfer of Property Act as a transfer of ownership in exchange for a price paid or promised or part paid or part-promised. On behalf of the appellant, Mr. Gopalaratnam contended that under the terms of Ex. A-1, the intention was that only on payment of the entire sale consideration title should pass. The document is in Tamil. In the preamble portion, after referring to the parties to the document, it is stated that these lands were conveyed by sale on the date of the execution. The expression is:

'Nanjai sthalangalai naladhu thedhiyil thangalukku kirayam seydhu koduthu thugaiyai petrukkondadharku vibaram.'

Then follows the recital that on the date of the execution, the executants had received a sum of Rs. 530 in cash. Then follows the recital regarding the balance of consideration:

'Ippathiram rigister seedy kodukkumpodhu maharastra sub-registrar avargal munbaka nangal rokkm petrukkolvadhu Ru 1900.' Then, the document says that in that way the sum of Rs. 2450 is received and that the vendee is entitled to enjoy the property with absolute powers of alienation. The recital is: 'Nanjai sthalangalai thangal indru mudhal avaigalukku undana jalatharupasana nidhi nukoba mudhaliya sarva sudhandhira pathiyathudan thangal ivvidam pol aandu anubavithu kolveergalagavum.'

5. The question is whether, having regard to the foregoing recitals, the intention was that title should pass to the plaintiff only on payment of the entire sale consideration. Mr. Gopalaratnam cited some authorities to show under what circumstances title can be taken to pass. In Sangu Iyer v. Cumarasami Mudaliar, ILR (1895) Mad 61, A had executed a sale in favour of B a registered conveyance, but no consideration was in fact paid. A retained possession of the land and subsequently sold it to C and D and delivered possession to them. C and D discharged the mortgage which was to have been paid off by B. In the interval between these two transactions, the plaintiff purchased the land from B and he alleged that the persons in possession had executed a lease deed in his favour. It was held that his claim could not prevail as against C and D. That is a short judgment in which the effect of the sale was not considered. The decision was based upon the fact that the alleged lease was found to be forgery, and the learned Judges held that to permit the plaintiff to succeed would mount to perpetuation of fraud. Therefore, that decision is of no help so far this case is concerned. In Ramalinga Mudali v. Aiyadorai Nainar : (1904)14MLJ493 , the consideration for the transaction was the offer of the purchaser to give his daughter in marriage to the vendor. The marriage did not come off, although the document was registered. It was held that mere registration, without reference to other circumstances cannot operate to transfer the property comprised in the instrument. On facts, that decision is not applicable to this case. In Md. Murtuza Hussain v. Abdul Rahman : AIR1949Pat364 , the document recited receipt of consideration. But the evidence established that the passing of title depended upon the passing of consideration. None of the Madras decisions is cited in that case. Having regard to the peculiar facts of that case, it was held that the intention was that passing of title depended upon the passing of consideration.

6. In Govindammal v. Gopalachariar : (1906)16MLJ524 , there was a prior sale in favour of one of the defendants and the vendor subsequently purported to sell the same property in favour of one of the plaintiffs. On the strength of the subsequent conveyance, the plaintiffs laid the suit. The concurrent finding was that the price that was fixed to be paid by the defendant at the time of the registration of the document was not in fact paid, and that as a matter of fact the defendant had paid nothing for the sale. On that account, the Court below gave a decree for the plaintiffs. In reversing this decision, the Bench observed-

'It is clear that under the provisions of Section 54 of the Transfer of Property Act, there was a valid sale of the land to the third defendant under Ex. I and this sale deed was registered as then required. All the reported decisions are to the effect that such a sale is a completed transaction notwithstanding that the price agreed upon at the time of execution has never been paid........The first defendant could no doubt bring a suit against the third defendant for payment of the price fixed for the land, but it must be held that the plaintiffs have no remedy whatever as against the third defendant.'

In Subbayar v. Moniam Subramania Iyer, ILR (1913) Mad 8 the suit was to set aside a sale deed on the ground that the sale deed was not supported by consideration. The relief was not based upon the ground that the sale was obtained by coercion or undue influence or any such invalidating circumstances. It was held that the plaintiff was not entitled to the relief. The Bench observed at page 9:

'................... the transfer of ownership of the land by sale is effected on the execution and registration of the conveyance even though the price be not paid, so I think I may say that where the title passes on failure of consideration or on failure to pay the agreed purchase money the remedy of the vendor is not to have the deed of sale set aside, but to recover the purchase money.'

A Full Bench of this Court in Kandasami Pillai v. Ramaswami mannadi : (1919)36MLJ313 had to consider a case of a lease transaction. In that case it was a part of the terms of the lease deed that the lessee should discharge a prior hypothecation on the land. It was found that this was not in the nature of a condition precedent, but was merely a concurrent covenant with the other obligations of the parties to the document. The Full Bench held that the creation of a present demise involved the right to immediate possession by the person to whom the demise was made, unless it could be shown that any of the stipulations imposed upon him for performance was in the nature of a condition precedent. Following this decision, Bench of this Court in Krishnamma v. Mali, ILR (1920) Mad 712 = AIR 1920 Mad 164, held that a vendee who has not paid the purchase money for the lands bought by him, is entitled to a decree against the vendor for possession of such lands and that the Court cannot make the decree conditional on payment of a purchase money, nor can it decree payment of the price to the defendant in the vendee's suit.

7. The principle deducible from the foregoing decisions is that payment of the price is not necessarily a sine qua non to the completion of the sale. If the intention is that the property should pass on registration, the sale is complete as soon as the deed is registered, whether the price has been paid or not. Then the purchaser is entitled to sue for possession, although he has not paid the price. This would follow from the words of Section 54 'price paid or promised or part paid or part-promised.' If the price is not paid, the seller on that account cannot repudiate the sale and his only remedy is to sue for the price or the balance of the price unpaid. Applying this principle, it would follow from the terms of Ex. A-1 in the instant case that the intention of the parties was that title should pass to the plaintiff, though it was one of the terms off the contract that the balance of sale consideration, namely, Rs. 1900 should be paid by the plaintiff to the vendor at the time of the registration of the sale deed. But such payment is not a condition precedent for the passing of title as would be seen from a reading of all the recitals. Mr. Gopalaratnam contended that the intention of the parties should be gathered not only from the terms of sale deed but also from the subsequent conduct, and he referred to the notice Ex. B-1 issued by the first defendant to the plaintiff on 16-5-1955 in which she stated that the sale should be completed within a week from the date of the execution of the sale deed by paying the balance of consideration. He submitted that the lower appellate Court failed to take note of this circumstance. I do not think that this criticism is justified. The lower appellate Court has considered the terms of Ex. A-1 in the first instance and observed that from the terms it is clear that the intention was that the passing of title did not depend upon the payment of entire consideration. An argument appears to have been advanced before the lower appellate Court that the subsequent conduct of the parties should also be considered. In dealing with that aspect, the lower appellate Court has referred to the notice Ex. B-1 in paragraph 6 of its judgment and ultimately held that title did pass to the plaintiff on the execution of the sale deed. It may also be noted in this connection that the case, as put forward in Ex. B-1, namely, that the agreement was that the sale should be completed within a week after execution by payment of the balance of the consideration, does not find a place in the cancellation deed (Ex. B-7). No evidence was also let in that respect. When the terms of Ex. A-1 are clear, it is not permissible to go beyond the terms thereof to find out the intention of the parties. As already pointed out by me, the terms do not warrant the conclusion that the payment of entire consideration was a condition precedent for the passing of title. The lower appellate Court was, therefore, right in holding that title passed notwithstanding the fact that the plaintiff did not pay Rs. 1900, which he agreed to pay before the Sub-Registrar.

8. In the result, the appeal fails and is dismissed. In the circumstances, I make no order as to costs in this appeal. No leave.

Appeal dismissed.


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