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Bihari Lall Lahoty Vs. Harendra Nath Sharma and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKolkata High Court
Decided On
Case NumberA.F.O.D. No. 377 of 1975
Judge
Reported inAIR1983Cal209
ActsRegistration Act, 1908 - Sections 17(1) and 49
AppellantBihari Lall Lahoty
RespondentHarendra Nath Sharma and ors.
Appellant AdvocateS.C. Mitter, ;Sushil Kumar Biswas and ;Sk. Manwar Ali, Advs.
Respondent AdvocateSaktinath Mukerjee and ;Prabir Kumar Samanta, Advs.
DispositionAppeal dismissed
Cases ReferredKedar Nath Dutta v. Shyamlal Khetry
Excerpt:
- .....to the said vendors as advance and the latter in their turn had deposited with the plaintiff title deeds relating to the aforesaid premises. on 23rd sept., 1960, ext. 2, a document was executed by the parties which inter alia recorded the said fact of payment of rs. 70,000/- made on 22nd sept., 1960 and also another sum of rs. 5,000/- previously made on 14th sept., 1960. the said agreement further recorded that the defendants of the instant suit had deposited their title deeds with the plaintiff with intent to create equitable mortgage or charge upon the aforesaid premises. on tha facts proved in the case we are inclined to hold that on 22nd sept., 1960 the defendants and their predecessor-in-interest jatindra had created a mortgage by deposit of title deeds in respect of the suit.....
Judgment:

Chittatosh Mookerjee, J.

1. This appeal is at the instance of the plaintiff in a suit for declaration that the property to which the documents of title mentioned in the plaint relate was charged with the payment of the loan together with interest and costs thereon amounting to Rs. 43,020/- to the plaintiff and for a decree under Order 34, Rule 4 of the Code of Civil Procedure. The defendants had contested the suit. The learned Subordinate Judge, Second Court, 24 Parganas has decreed the suit in part on contest for a sum of Rs. l,851/-, but has dismissed the rest of the plaintiff's claim.

2. It is a common case of both parties that on or about the 14th Sept., 1960 the defendants Nos. 1 to 4 and Jatindra Nath Sharma, the predecessor-in-interests of the defendants Nos. 5 to 14 had entered into an agreement with the plaintiff for sale of their premises No. 39/B, Purna Das Road for a sum of Rs. 1,50,000/-. On the same data they had received from the plaintiff-appellant a sum of Rs. 5,000/- as earnest money and in part payment of the purchase price. On 22nd Sept., 1960 the plaintiff had paid another sum of Rs. 70,000/- to the said vendors as advance and the latter in their turn had deposited with the plaintiff title deeds relating to the aforesaid premises. On 23rd Sept., 1960, Ext. 2, a document was executed by the parties which inter alia recorded the said fact of payment of Rs. 70,000/- made on 22nd Sept., 1960 and also another sum of Rs. 5,000/- previously made on 14th Sept., 1960. The said agreement further recorded that the defendants of the instant suit had deposited their title deeds with the plaintiff with intent to create equitable mortgage or charge upon the aforesaid premises. On tha facts proved in the case we are inclined to hold that on 22nd Sept., 1960 the defendants and their predecessor-in-interest Jatindra had created a mortgage by deposit of title deeds in respect of the suit premises for a sum of Rs. 75,000-, Further upon true constructionof the deed dated 23rd Sept., I960 we accept the contention of the learned Advocate for the appellant that the deed, Ext. 2, was in its true nature a memorandum recording the said completed transaction of mortgage of the previous date. In fact Mr. Saktinath Mukherjee, appearing on behalf of the defendant-respondents, did not seriously dispute the said contention. It may be noted that it is the case of the plaintiff himself that on 23rd Sept., 1960 no stipulation was made between the parties for payment or interest in respect of the aforesaid mortgage by deposit of title deeds. Bihari Lall Lahoty, P. W. 1, the plaintiff, in his evidence had inter alia testified when he was ultimately unable to purchase the suit premises he had requested the defendants to return the money. They had asked for time and had entered into an agreement for payment of Rs. 75,000/- by instalments. At that time the defendants had agreed to pay interest and costs as security for payment of Rupees 75,000/-, they had deposited their title deeds of the suit premises with the plaintiff. On 26th August, 1961 the plaintiff and the defendants executed an unregistered agreement which was marked Ext. 3 in the case. The parties by the said agreement declared that the agreement for sale of the premises No. 39/B, Purna Das Road had been cancelled by mutual consent of the parties. The mortgagor by the second clause of the said document agreed to repay to the mortgagee the said principal sum of Rs. 75,000/- by three instalments mentioned in the document and they also agreed to pay interest at the rate of 8% per annum simple and also all costs incurred by reason of having entered into the agreement for sale. Under the said agreement the principal sum with interest was payable in three instalments first of such instalment of Rs. 25,000/- to be paid on or before the 31st August, 1961 and the second instalment of the same amount on or before the 30th Sept., 1961 and the balance of the principal sum and interest and costs were payable on or before the 31st Dec., 1961. In default of payment of any of the instalments the entire balance for the time being due to the mortgagee shall at once fall due and become payable forthwith.

3. It is also not disputed that on different dates the defendants had paid a total sum of Rs. 75,000/- to the plaintiff. The plaintiff produced a series of statement of accounts, Ext. 4 series, indicating that he had appropriated the said sum towards the total amount due as principal, interest and costs. After adjusting the said amounts paid by the de-fendants the plaintiff in the instant suit claimed that the balance amount of Rupees 43,020/- had remained due and payable. Principal point in this appeal would be whether or not the plaintiff was entitled to charge interest in respect of the aforesaid sum of Rs. 75,000/- given as loan and in respect of which the defendants had created a mortgage by depositing title deeds of the aforesaid premises as security. The plaintiff's right to claim interest was based upon the deed dated 26th August, 1961, Ext. 3. Therefore, we have to decide whether the said document, Ext. 3, dated 26th August, 1961 was an instrument purporting to operate, to create, declare, assign, limit or extinguish, any right, title or interest whether vested or contingent of the value of one haundred rupees and upwards, to or in immovable property vide Section 17(1)(b) of the Indian Registration Act.

4. Mr. Mitter, learned Advocate for the appellant, submitted before us that in the instant case the equitable mortgage was completed by the deposit of the title deeds made by the defendants on 22nd Sept., 1960 and neither the memorandum, Ext. 2, not the deed, Ext. 3, being contemporaneous with the transaction could operate as instruments of mortgage and, therefore, according to Mr. Mitter neither Ext. 2 nor Ext. 3 required registration. Mr. Mitter further submitted that the mortgage by deposit of title deeds had been created by deposit of title deeds made by the defendants on 22nd Sept, I960 with intent to create security thereon Alternatively Mr. Mitter submitted that only after the parties mutually agreed to cancel the agreement for sale of the premises in question there was a fresh mortgage by deposit of title deeds prior to the execution of the deed dated 26th August, 1961. In this connection, Mr. Mitter has relied upon certain averments made by the defendants in their written statement about the creation of an equitable mortgage, vide para 7 of the written statement. Mr. Mitter has further submitted that the Ext. 3 was also in the nature of a declaratory deed regarding the past transaction of mortgage created by deposit of the title deedo. Mr. Mitter lastly submitted that a deed containing stipulation for payment of interest in respect of a mortgage already created by the deposit of title deeds does not require registration inasmuch as such stipulation about interest does not create, declare or limit any right, title or at-terest to or in any immovable properties.

5. Having given our anxious consideration to the facts and circumstances of the caseand after having considered the deed, Ext 3, we are unable to accept the submission of Mr. Mitter about the true construction of the said deed. Mr. Mukherjee, appearing on behalf of the respondents, has rightly pointed out that the parties in the said deed, Ext. 3, clearly recited that the mortgagors having asked for time for payment of the amount due the mortgagee had agreed on the terms and conditions herein contained. Thus the said indenture, Ext. 3, contained the terms and conditions for repayment of the amount due upon the mortgage of the premises in question. Further the plaintiff does not claim that according to original terms of the mortgage by deposit of title deeds any time was stipulated for repayment of the mortgage money. Clauses (2) and (3) of the deed, Ext. 3 made provision for repayment of the mortgage money of Rupees 75,000/- by three instalments. Thereby the right of the mortgagee to enforce mortgage by putting the same to sale was modified. Secondly the mortgagor's equity of redemption was affected by reason of the provision for repayment of the mortgage dues by three instalments with the default clause for the entire balance becoming due in case of the failure of the mortgagors to pay any one of the instalments. Thirdly, the said deed, Exhibit 3. provided for the first time for payment of interest upon the principal amount of loan given by way of mortgage. Our attention has been also drawn to clause (5) of the said deed, Ext. 3, which was in the following terms :

'Subject to the modification herein contained the said mortgage by deposit of the title deeds shall remain in full force and effect and shall be read, construed and be enforceable as if the terms of these presents were originally incorporated therein.'

In view of the very clear language used we are bound to hold that the parties executing the aforesaid deed intended to create or at least limit, right, title and interest to or in respect of the aforesaid premises. In the result, in the absence of registration the said deed, Ext. 3, would be inadmissible in evidence and, therefore, the plaintiff cannot enforce the said deed, Ext. 3, in the instant suit by demanding payment of interest upon the principal sum advanced by him by way of mortgage by deposit of title deeds.

6. Mr. Mitter referred to a number of decisions relating to admissibility of oral evidence in terms of Second Proviso to Section 92 of the Evidence Act. It is not necessary for us to set out the decisions in extenso inasmuch as the said reported decisions did not consider the effect of non-registration of documents where registration is compulsory under Section 17(1)(b) of the Registration Act. Mr. Mitter himself has drawn our attention to pages 46 and 47 of Mulla's Registration Act, 8th Edition. In the instant case we are not concerned with the question whether oral evidence is admissible to explain the deposit of title deeds because in our view the deed, Ext. 3, itself constituted the contract between the parties relating to the repayment of the mortgage dues and also regarding payment of interest at the rate of 8% simple. In the light of the decision of Kedar Nath Dutta v. Shyamlal Khetry, reported in (1873) 11 Beng LR 405, and the later decisions which follow the same, we hold that the deed (Ext. 3) ought to be treated as the contract for the mortgage because there was sufficient averments to indicate the parties themselves intended the said deed, Ext. 3, (to) be the repository and appropriate evidence of their agreement relating to the repayment of the mortgage dues and payment of interest claimed in the suit. In this connection, the comments made in pages 48 and 49 of Mulla's Registration Act would be also germane. The learned author referred to a large number of judicial precedents holding that an agreement by which the mortgagor agrees to variation of the terms of a mortgage requires registration. We do not wish to lengthen this judgment by setting out this decision particularly when the learned Advocates for the parties did not contest the legal propositions but according to the learned Advocate for the appellant the document in question was not an operative instrument but a document regarding the past transaction. We have already indicated that we are unable to agree with this contention of the appellant.

7. We cannot permit the appellant to make out a new case in appeal by contending that there was a fresh deposit of title deeds by the defendants with the intent to create security for repayment of Rs. 75,000/-mentioned above. Both in his pleading and in evidence the plaintiff's case was that on 14th Sept., 1960 there was an agreement for sale and on 22nd Sept., 1960 the defendants had mortgaged the said properties by depositing their title deeds. The plaintiff's further case throughout was that by the deed dated 26th August, 1961 the defendants had agreed to pay interest and costs in respect of the transaction. Further the defendants in para 7 (e) while pleading that the deeddated 26th August, 1961 constituted a fresh and independent mortgage had averred that the said deed was inadmissible in evidence and cannot be acted upon in the context of the prayers as made to the Court by the plaintiff in his plaint. Therefore, we cannot act upon a part of the alleged admission contained in the said para 7 (e) of the written statement and the defendants legitimately can contend that their case in the said paragraph was that the said deed which constituted a mortgage contract was inadmissible in the absence of registration.

8. The trial Court which had the advantage of looking at the demeanour of the witnesses has believed the defendant's case relating to the circumstances under which D. W. 1, Harendra Nath Sarma, had signed the statement of accounts, Ext. 4 series. Upon assessment of the evidence we are not prepared to take another view on the point. Further while signing this statement, D. W. 1 had made confirmation subject to the errors and omissions etc. At the relevant time Harendra Nath was not the karta. Therefore, in any event, the alleged confirmation purported to be made by him will not be binding upon the rest of the defendants. Some of the originals of these statements were not marked as exhibits on the defendants' plea that they had been filed with the Income-tax Authorities. Some of the copies of the statements do not contain the signature of Harendra Nath. In the absence of the original before us, we are unable to verify whether they were in fact signed by Harendra Nath, D. W. 1,

9. Further we have already upheld the defendants case that in the absence of registration the deed, Exhibit 3, containing provision for payment of interest was inadmissible in evidence. Therefore, by merely relying upon the signature of one of the defendants in these statement of accounts the plaintiff cannot enforce the said agreement, Ext. 3, providing for payment of interest.

10. For the foregoing reasons we dismiss this appeal. In the circumstances of this case both parties would bear their respective costs throughout.

11. After the judgment is delivered, Mr. Biswas, learned Advocate for the appellant, has prayed for a certificate under Article 133 of the Constitution. In our view, this case does not involve any substantial question of law of general importance which requires to be decided by the Supreme Court. The law on the subject is already settled. In the circumstances, we reject the prayer for a certificate under Article 133 of the Constitution of India.

Amitabha Dutta, J.

12. I agree.


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