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Sk. Abdul Gaffar Vs. Sudha Kanta Roy and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKolkata High Court
Decided On
Case NumberA.F.A.D. No. 949 of 1976
Judge
Reported inAIR1985Cal133,88CWN915
ActsBengal Money-lenders Act, 1940 - Sections 2(12), 36, 36(5) and 37A; ;Transfer of Property Act, 1882 - Sections 58
AppellantSk. Abdul Gaffar
RespondentSudha Kanta Roy and anr.
Appellant AdvocateBidyut Kumar Banerjee, Adv.
Respondent AdvocateProvas Kumar Sen and ;Ajit Kr. Bhattacharyya, Adv. (2) for Respondent No. 1
DispositionAppeal allowed
Cases ReferredRathnavarmaraja v. Smt. Virnla
Excerpt:
- .....theparties by the ostensible sale deed and the agreement for reconveyance in respect of the suit property on 26-4-1971 was a loan in substance and for restraining the defendants from disturbing plaintiffs possession in the suit property together with a prayer for the relief under section 36 and 37a of the bengal money lenders act, 1940.3. it was the case of the plaintiff that he took loan of rs. 1000/- from the defendant 1 and as security for the loan plaintiff executed an ostensible sale deed in respect of the suit property in favour of the defendant 1 reciting therein rs. 1450/- as the consideration money including the advance interest of rs. 450/- on 26-4-1971 corresponding to 12th baisakh 1378 b.s. and the defendant 1 executed an agreement for reconveyance on the same date......
Judgment:

Sukumar Chakravarty, J.

1. This second appeal is directed against the judgment and decree passed by the learned Subordinate Judge, 2nd Court, Hooghly in Title Appeal No. 277 of J975 reversing the judgment and decree passed by the learned Munsif, 1st Court, Serampore in Title Suit No. 77 of 1973, and dismissing the suit.

2. Plaintiff filed the suit for declaration that the transaction effected between theparties by the ostensible sale deed and the agreement for reconveyance in respect of the suit property on 26-4-1971 was a loan in substance and for restraining the defendants from disturbing plaintiffs possession in the suit property together with a prayer for the relief under Section 36 and 37A of the Bengal Money Lenders Act, 1940.

3. It was the case of the plaintiff that he took loan of Rs. 1000/- from the defendant 1 and as security for the loan plaintiff executed an ostensible sale deed in respect of the suit property in favour of the defendant 1 reciting therein Rs. 1450/- as the consideration money including the advance interest of Rs. 450/- on 26-4-1971 corresponding to 12th Baisakh 1378 B.S. and the defendant 1 executed an agreement for reconveyance on the same date. The possession in the suit property remained with the plaintiff. The market value of the suit property was Rs. 3000/- at the relevant time. Plaintiff delivered 12 maunds of paddy to the defendant 1 towards the interest in 1378 B.S. Plaintiff offered Rs. 100/- to the defendant 1 towards the interest in 1378 B.S. Plaintiff offered Rs. 100/- to the defendant 1 towards the interest and the principal for the next year but the defendant 1 refused to accept the same on 1-4-1973. The plaintiff filed the suit. During the pendency of the suit, plaintiff came to know that defendant 1 had sold the suit property to the defendant 2 by a collusive and fraudulent sale deed and accordingly the defendant 2 was impleaded in the suit.

4. The defendant 1 filed the written statement contending inter alia that the transaction effected between the parties in respect of the suit property was an out and out sale with an agreement for reconveyance and that the same was not a mortgage by conditional sale. The defendant denied all other allegations of the plaintiff and contended that the suit property was sold for a consideration at the prevailing market rate. The defendant 2 filed the written statement supporting the contention of the defendant 1. It was further contended by the defendant 2 that he purchased the suit property from the defendant 1 after ascertaining from the plaintiff that the plaintiff was not willing to repurchase the suit property from the defendant 1. The defendant No. 2 contended also that he was the bona fide purchaser for value without notice. According to him, the plaintiff was not entitled to the relief claimed. The defendants contested the suit on such pleas.

5. The learned Munsif on consideration of the evidence and on application of the well established tests found that the transaction between the parties was a loan in substance and that the plaintiff took the loan of Rs. 1000/-from the defendant 1 on the basis of the said transaction. The learned Munsif found also that sale deed executed by the defendant 1 in favour of the defendant 2 was a collusive document created with the knowledge of the transaction for the purpose of defeating the claim of the plaintiff. The learned Munsif accordingly decreed the suit. On appeal, the learned Subordinate Judge set aside the judgment and decree of the learned Munsif and dismissed the suit on the finding that the transaction was an out and out sale with an agreement for reconveyance and that the plaintiff did not exercise his right to repurchase according to the agreement for reconveyance, and that the plaintiff could have taken recourse to the West Bengal Restoration of Alienated Act, 1973.

6. Being aggrieved, the plaintiff has preferred this second appeal on the ground that the learned subordinate Judge has committed mistake in law in reversing the judgment and decree of the learned Munsif without considering the relevant evidence and without applying the well established tests on the basis of relevant evidence to ascertain whether the disputed transaction is loan in substance.

7. Mr. Bidyut Kumar Banerji, appearing for the plaintiff-appellant has made his submission in support of this second appeal.

8. Mr. Provas Kumar Sen with Mr. Ajit Kumar Shattacharya, appearing for the respondent-defendant 2 has submitted that the learned subordinate Judge arrived at the findings on consideration of the evidence although he has not made proper detailed discussion of evidence in his judgment, and that accordingly the learned Subordinate Judge has not committed any mistake in law in reversing the judgment and decree of the learned Munsif and dismissing the suit. Mr. Sen has further submitted that the suit rightly merits the dismissal on the ground that the suit had not been properly valued and stamped. His further submission is that the defendant No. 2 being a bona fide purchaser for value without notice, is entitled to get protection Under section 36(5) of the Bengal Money-lenders Act.

9. Section 37A of the Bengal Moneylenders Act reads as follows : 'In the case where any loan is secured by a mortgage and the mortgagor ostensibly sells the mortgaged property on any of the conditions specified in Sub-section (c) of Section 58 of the T. P. Act, 1882 (IV of 1882) then, notwithstanding any thing to the contrary contained in Proviso to the said subsection, the transaction shall always be deemed to be a mortgage by conditional sale and the mortgagee a mortgagee by conditional sale for the purpose of the said sub-section'. A borrower to get the protection of Section 37A of the Bengal Money-lenders Act must show firstly that there is a loan, secondly such loan has been secured by executing a mortgage, and thirdly the borrower ostensibly sells the mortgaged property on any of the conditions enumerated in Section 58(c) of the T. P. Act. If the above conditions are fulfilled then only the transaction is to be treated as a mortgage by conditional sale even if the transaction is effected by two separate deeds viz. the ostensible sale deed and the agreement for reconveyance. 'Loan' as defined in Section 2(12) of the Bengal Money-lenders Act includes any transaction which is in substance a loan. For determination of the nature of the transaction intrinsic evidence from the recitals of the two documents themselves and the extraneous evidence regarding possession in the suit property and the value thereof are relevant. The decision in the case of Manindra Nath Bose v. Narendra Krishna Mitra, as reported in (1980) 2 Cal LJ 70 is relied on. The learned Munsif on due consideration of the evidence of P.W. 1 (Plaintiff), P.W. 2, P.W. 3 and P.W. 4 arrived at the finding that although the kobala Ex. A recited the consideration money as Rs. 1450/- plaintiff actually received Rs. 1000/-from the defendant 1 and Rs. 450/- was settled and regarded as interest. The learned Subordinate Judge on the other hand, without discussing the evidence of P.W. I (plaintiff), P.W. 2, P.W. 3 and P.W. 4 has observed in his judgment that it is clear that the plaintiff did not come with cogent evidence to show that Rs. 1000/- passed as per the transaction and Rs. 450/- was included in the Kobala Ex A as interest. He has further observed in his judgment that P.W. 3 was silent in his evidence in the matter. I have gone through the evidence of P.W. 1 (plaintiff), P.W. 2, P.W. 3 and P.W. 4 and 1 find that the learned Subordinate Judge has not considered the evidence of those witnesses at all. P.W. 3 Subal Roy has stated in his evidence that he was present at the time of talk of sale and that it was settled that Rs. 1000/- would be paid in cash for consideration of the sale and interest was settled at Rs. 450/- and that two deeds, the sale deed and another deed of reconveyance were executed and he identified the plaintiff before the Sub-Registrar. So the learned Subordinate Judge committed mistake when he observed that P.W. 3 was silent in his evidence in the matter. Besides the evidence of P.W. 3, P.W. 1 (plaintiff) P.W. 2 and P.W. 4 have proved that plaintiff received Rs. 1000/-and Rs. 450/- was included in the recital of consideration money in the kobala Ex A as interest. The finding of the learned Subordinate Judge is accordingly perverse in this respect. The finding of the learned Munsif in this respect based on due consideration of the evidence could not be shown as wrong by the learned Subordinate Judge with reasoning based on evidence.

10. The evidence of P.W. 1 (plaintiff), P.W. 2, P.W. 3 and P.W. 4 has shown that Rs. 450/- was settled as interest and the same was included in the consideration money recited in the kobala although plaintiff received Rs. 1000/- from the defendant 1. This particular fact established by evidence proves the case of the plaintiff that the plaintiff took the loan of Rs. 1000/- from the defendant No. 1 although the kobala Ex A and the agreement for reconveyance Ex I were executed between the parties. This fact is also supported by another fact proved by P.W.s to the effect that plaintiff delivered 12 maunds of paddy towards interest within Chaitra of 1378 B.S.

11. The learned Munsif on due consideration of the evidence found that the possession in the suit land remained with plaintiff in spite of the execution of the kobala and the agreement for reconveyance. Learned Munsif has held that all the P.W.s have corroborated each other in this respect and that defendant's evidence in this respect is vague and unbelievable. Defendant 1 could not produce any rent receipt to show that he paid rent after the execution of the kobala Ex A. The learned subordinate Judge on the other hand without discussing the evidence regarding possession as adduced by the parties has held that plaintiff's evidence is not sufficient to prove that he did not part with the possession of the suit property in favour of the defendant 1. I have gone through the evidence of P.Ws. P.Ws. I to 4 including the plaintiff (P.W. 1) have stated that the suit land is in possession of the plaintiff. The learned Munsif believed their evidence and he disbelieved the evidence of defendant 1 and defendant 2 in this respect. It appears that the learned Munsif rightly did so. The finding of the learned Subordinate Judge in the matter of possession also appears to be perverse.

12. As regards the value of the suit property, the learned Munsif, on due consideration of the kobala Ex. 3 filed by the plaintiff and the kobalas Exs. A(1) and A(2) filed by the defendants and the evidence in this respect, found that the value of the suit property as recited in the kobala Ex. A was below the market rate prevailing at the relevant time. The learned Subordinate Judge could not agree with the finding of the learned Munsif as the kobala Ex. 3 related to the land of a different mouza and that it was of the year 1974. The evidence has disclosed that the mouza of the land of kobala Ex. 3 is adjacent to the mouza of the suit and that the lands are of the same class. The learned Subordinate Judge while disagreeing with the finding of the learned Munsif does not appear to have considered the kobalas Exs. A(1) and A(2). So the finding of the learned Subordinate Judge in this respect also does not appear to be based on appreciation of relevant evidence. The learned Munsif on due consideration of the evidence and applying the well-established tests found that the transaction effected between the parties by the ostensible kobala Ex. A and the agreement for reconveyance Ex. I was a loan in substance and not an out and out sale with an agreement for reconveyance. The finding of the learned Subordinate Judge that the transaction was an out and out sale with agreement for reconveyance is based on perverse view of the evidence and accordingly it cannot be sustained.

13. The learned counsel for the respondent-defendant 2 has submitted that plaintiff in his cross-examination has stated that he admitted before the Sub-Registrar that nothing false was incorporated in the disputed sale deed Ex A and that he received the consideration money of the kobala Ex. A. It should be remembered that plaintiff had gone to S. R. office to get the ostensible sale deed and the agreement for reconveyance registered. So he was bound to admit what was recited in the ostensible sale deed Ex. A. This admission of plaintiff before the Sub-Registrar regarding the recitals of the ostensible kobala does not affect in any way the real character of the transaction which was found to be a loan in substance.

14. Mr. Sen, the learned Counsel for the respondent-defendant 2 has submitted that the defendant 2 being a bona fide purchaser for value without notice is entitled to protect his right acquired by purchase and entitled to get the protection also under Section 36(5) of the Bengal Money-lenders Act. It may be pointed out that neither at the time of trial nor at the time of first appeal, the defendant 2 took the plea, that he was entitled to the protection Under section 36(5) of the Bengal Money-lenders Act. So the defendant 2 cannot be allowed to take such plea for the first time in this second appellate Court when such plea Under section 36(5) of the Bengal Money-lenders Act is a mixed question of law and fact. Even if it be allowed at this stage, still 1 find that defendant 2 is not entitled to get the protection Under section 36(5) of the Bengal Moneylenders Act. Mr. Sen in support of his submission has relied on the provisions of Section 36(5) itself and on the decision in the case of Promode Kumar v. Niknil Bhusan reported in 53 Cal WN 416 : (AIR 1949 PC 183). Under Section 36(5) of the Bengal Money-lenders Act, the right of an assignee for value remains unaffected in a suit Under Section 36 of the said Act. The contention of the defendant 2 in his written statement and in his evidence, the facts and circumstances and his conduct in acquiring the suit property leave no room to think and hold that the defendant 2 is the absolute assignee of the entire amount or debt owing under the mortgage by conditional sale and of the benefit of all securities for the same and of all powers, rights, remedies thereby expressly conferred. It is the case of the defendant 2 all-through that the transaction between the plaintiff and the defendant 1 was out and out sale and that he purchased the suit property from the defendant 1 for value. The defendant 2 not being the bona fide assignee for value of the amount under the mortgage and of the mortgage by conditional sale itself including the benefit of all securities etc., is not entitled to get the protection Under section 36(5) of the Bengal Money Lenders Act.

15. As regards defendant 2's plea in connection with his bona fide purchase for value without notice, the learned Munsif found that the sale of the suit land by the defendant 1 to the defendant 2 after the institution of the suit was a collusive one. The learned Subordinate Judge on the other hand found that the purchase by the defendant 2 from the defendant I after expiry of the period for reconveyance on enquiry from the plaintiff by the defendant 2 that the plaintiff would not exercise his right of purchase of the suit property was not illegal. It is true that the defendant 2 in his written statement averred that he enquired of the plaintiff before his purchase from the defendant 1 whether the plaintiff was willing to exercise his right of purchase in accordance with the agreement for reconveyance. The defendant 2 in his deposition has however not stated so. In his deposition the defendant 2 (D.W. 4) has stated that he enquired of the plaintiff of the genuineness of the suit property. He has stated also in his evidence that he heard of the suit between the plaintiff and the defendant 1 and that yet he did not ask defendant 1 as to why he should purchase the property though the property was in dispute. As regards the payment of consideration also, the learned Munsif was not convinced with the evidence in this regard. The learned Subordinate Judge has not made any discussion and observation in this respect. Both the courts below found that the defendant 2 signed the sale deed Ex A as an attesting witness. All the facts stated above go to show that defendant 2 was not a bona fide purchaser for value without notice. The learned Munsif therefore rightly held that the kobala of the defendant No. 2 showing his purchase of the suit property from the defendant 1 was a collusive one. The finding of the learned Subordinate Judge in this respect being based on perverse view of the evidence is not sustainnble.

16. Mr. Sen, the learned counsel for the respondent defendant 2 has attacked the continuance of the suit itself on the ground that the suit was not properly valued and stamped and has submitted that the suit must fail. In support of his submission. Mr. Sen has relied on the decision in the case of M/s. Tarachand Ghanashyam Das v. State of West Bengal reported in : AIR1955Cal258 . Mr. Sen while elucidating his submission has stated that plaintiff in a suit for declaration with consequential relief of injunction and for relief Under sections 36 and 37A of the Bengal Money-lenders Act has valued the relief of injunction only and paid court-fee thereon and also paid court-fee of Re. 1/- for the relief Under sections 36 and 37A of the Bengal Money-lenders Act, and has not valued the relief for declaration. The valuation statement in the plaint does not support the submission of Mr. Sen. It appears from the plaint that the relief for declaration with injunction was valued at Rs. 10/- under Section 7(iv)(c) of the Court-fees Act and it is not correct to say that the relief for declaration was not valued. The trial Court framed the issue to the effect whether the suit was properly stamped and decided the issue in favour of the plaintiff. In the first appellate Court the finding of the trial court on that issue was not challenged. So this question cannot be agitated in the second appeal. It has been held in the case of Rathnavarmaraja v. Smt. Virnla reported in : [1961]3SCR1015 , 'Whether proper court-fee is paid on a plaint is primarily a question between the plaintiff and the State. The jurisdiction in revision exercised by the High Court under Section 115 of the Civil P.C. is strictly conditioned by Clauses (a) to (c) thereof. The defendant who may believe and even honestly, that proper court-fee has not been paid by the plaintiff has still no right to move the superior courts by appeal or in revision against the order adjudging payment of court-fee payable on the plaint'. In the circumstances, as mentioned above, the submission of Mr. Sen in this respect is not sustainable. Furthermore, the decision in : AIR1955Cal258 as relied on by Mr. Sen is on different facts and does not appear to be relevant in the facts of the present case. So this line of attack on the suit also fails.

17. In view of what has been stated on all the points as discussed above, I find that the learned subordinate Judge committed mistake in law in reversing the judgment and decree of the learned Munsif and dismissing the suit.

18. In the result, this appeal is allowed on contest. The judgment and decree of the learned Subordinate Judge are set aside and those of the learned Munsif are restored and confirmed with the modification that the first instalment shall be payable within Sravan of 1391 B.S. if not already paid. I make no order as to costs in this appeal.


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