TaxTMI 
TaxTMI 
2014 (3) TMI 1205
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....ered sale deed dated 01.11.2011, the defendant transferred the suit property to the plaintiffs for a total consideration of Rs. 1,65,00,000/-. The plaintiffs claim that the respective shares of the three plaintiffs in the suit property is as follows: (i.) Plaintiff No. 1's share being 66.66% (ii.) Plaintiff No. 2;s share being 23.34% (iii.) Plaintiff No. 3's share being 10% 2. The sale deed was registered as document No. 13,180 in Book No. I Volume No. 6,205 at pages 64-74 on 02.12.2011 in the office of the Sub-Registrar No. IX, New Delhi. The plaintiffs state that their right of possession was recognized in the said sale deed, which acknowledge that "the vacant and physical possession of the abovementioned property under sale has been given to the Vendees by the Vendor, who have occupied the same. 3. The case of the plaintiffs is that despite the receipt of the entire consideration and execution of the sale deed, the defendant has failed to handover the physical vacant possession of the suit property to the plaintiffs - citing personal reasons like ill-health of the defendant's wife, and urgent work commitments. The plaintiffs state that they did not press ....
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....property in favour of the plaintiffs, and handover the original chain of documents to the plaintiffs. The defendant states that the loan was interest bearing @ 2% per month, which was payable in cash every month, against which the defendant could not claim any receipt. The defendant states that under the loan transaction, the plaintiffs had also agreed to execute a fresh sale deed in favour of the defendant, as & when the entire money is paid along with: interest @ 2% per month; expenses incurred while registering the sale deeds; court fees, etc. to the plaintiffs by the defendant. Consequently, the defendant does not deny the factum of voluntary execution and registration of the instrument of sale deed in respect of the suit property, as claimed by the plaintiffs, but denies that the said instrument was executed to sell the suit property, as the instrument was executed to secure the "loan‟ taken from the plaintiffs by the defendant. 7. The defence of the defendant is that - the fact that possession was not claimed by the plaintiffs till 28.04.2012, even though the sale deed was executed and registered on 02.12.2011, shows that the intention of the parties was not to trans....
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....consideration therefor, are admitted facts which entitle plaintiffs to grant of relief of possession forthwith against the defendant on the basis of their title to the suit property. 12. Mr. Kaul submits that the defence set up by the defendant is that of a loan transaction between the parties. He submits that no document in support of the said defence has been produced by the defendant. The defendant has claimed that the registered sale deed dated 01.11.2011 was executed by the defendant in favour of the plaintiffs with a view to secure the so-called loan taken by the defendant from the plaintiffs. Mr. Kaul submits that such a defence is not tenable, and is barred under Sections 91 & 92 of the Evidence Act, 1872 in the face of the registered instrument of sale, admittedly executed by the defendant in favour of the plaintiffs. A written document cannot be countenanced by any oral evidence. Once a document has been admitted, Sections 91 & 92 of the Evidence Act come into play and any oral evidence to prove to the contrary cannot be accepted. Mr. Kaul submits that the defence raised by the defendant, on the face of it, is of an illegal transaction hit by Section 40(A)(3) of the In....
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....document, or receipt of money, apart from the sale deed. He refers to the following clause in the sale deed, in this respect: "That in consideration of Rs. 1,65,00,000/- (Rupees One Crore and Sixty Five Lakhs only) which has been received previously by the Vendor from the Vendees as a full and final settlement, as per details given below: 1. Received through cheque as No. 373237 dated 24.02.2011 Rs. 3,50,000/- 2. Received through cheque as No. 373238 dated 25.02.2011 Rs. 3,50,000/- 3. Received through cheque as No. 359182 dated 24.02.2011 Rs. 3,00,000/- 4. Received through cheque as No. 373252 dated 13.10.2011 Rs. 3,50,000/- 5. Received through cheque as No. 437410 dated 15.10.2011 Rs. 5,60,000/- 6. Received through cheque as No.437411 dated 16.10.2011 Rs. 9,00,000/- 7. Received through cheque as No. 437412 dated 17.10.2011 Rs. 9,00,000/- 8. Received through cheque as No. 437413 dated 18.10.2011 Rs. 9,00,000/- 9. Received through cheque as No. 437414 dated 19.10.2011 Rs. 9,00,000/- 10. Received through cheque as No. 437415 dated 20.10.2011 Rs. 9,00,000/- 11. Received through che....
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....to a contract with the intention to deceive or induce the other party to enter into a contract. He submits that where the consent of a party is obtained by fraud, the contract is voidable at the option of the party whose consent was so caused. (see Section 19 of the Contract Act) 17. Mr. Mittal submits that the plaintiffs made a promise to the defendant that they shall not misuse the aforesaid sale deed and shall execute a reverse sale deed in favour of the defendant on repayment of the loan amount. He submits that upon the filing of the present suit, the fraudulent intentions of the plaintiffs‟, which they entertained right from the beginning, got exposed, thus entitling the defendant to proffer the counter-claim for cancellation of the sale deed. 18. Mr. Mittal submits that bar of Section 91 & 92 of the Indian Evidence Act is not applicable in the present case, since the contentions raised in the counter claim of the defendant are covered under Provisos 1 to 3 to Section 92, and the explanation 3 to Section 91. 19. Mr. Mittal has placed reliance on several decisions in support of his submissions, which shall be referred to a little later. Mr. Mittal submits that th....
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....n of property, or any matter required by law to be reduced to the form of a document have been proved according to the last section, no evidence of any oral agreement of statement shall be admitted, as between the parties to any such instrument or their representatives in interest, for purpose of contradicting, varying, adding to, or subtracting from, its terms; Provision (1) - Any fact may be proved which would invalidate any document, or which would entitle any person to any decree or order relating thereto; such as fraud, intimidation, illegality, want of due execution, want of capacity in any contracting party, 76[want or failure] of consideration, or mistake in fact or law. Proviso (2) - The existence of any separate oral agreement as to any matter on which a document is silent, and which is not inconsistent with its terms, may be proved. In considering whether or not this proviso applies, the Court shall have regard to the degree of formality of the document. Proviso (3). - The existence of any separate oral agreement, constituting a condition precedent to the attaching of any obligation under any such contract, grant or disposition of property, may....
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....tric connections in working order, along with separate water and electric meters, and the Vendees have agreed to purchase the same for a sum of Rs.1,65,00,000/- (Rupees One Crore and Sixty Five Lakhs only)." [emphasis supplied] 23. The sale deed also records, as noticed hereinabove, that the entire consideration of Rs.1.65 Crores for the sale of suit property by the defendant to the plaintiffs stands paid in the manner described and "nothing remains due out of the sale price". The sale deed also records that "the vendor hereby absolutely assigns, conveys and transfers to the vendees all rights of ownership, titles and of interests in the abovementioned property under sale hereby conveyed". It also provides: "The Vendees shall hereinafter hold use, enjoy as they like and to sell, mortgage, lien, let-out or make additions/alterations/ re-construct with all construction for construction of further floors in the same as their own property without any hindrance, claim or demand whatsoever from the Vendor". [emphasis supplied ] 24. Therefore, the terms of the sale deed clearly show that the nature of the transaction that the said instrument records is an absolute conveyance o....
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....action with security of immovable property. 26. Explanations 1 and 2 of Section 91 have no relevance for the present case. Explanation 3 only states that the statement of a fact in a document, "other than the facts referred to in this Section" may be proved by leading oral evidence. The "fact referred to in this Section" are the "terms of a contract, or a grant, or of any other disposition of property" which have been reduced to the form of the document. For instance, if the age or address, or paternity of a party is recorded in an instrument, it shall be open to the parties to lead evidence to establish that the same is not correctly recorded, or that the same is, in fact, different from what the instrument records. However, this explanation cannot be invoked to disprove the "terms of a contract, or of a grant, or of any other disposition of property". 27. Section 92 of the Evidence Act, inter alia, provides that where the terms of a grant or other disposition of property have been proved according to Section 91 - and in this case the execution and registration of the instrument of sale is not disputed by the defendant, no evidence of any oral agreement, or statement shall b....
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....loan, interest and other charges. Pertinently, the written statement or the counter claim do not whisper about a "fraud", though the defendant repeatedly states that the plaintiffs are greedy, have turned dishonest, and are of a criminal mind. A mere mention of "fraud" in a pleading is not sufficient. A party pleading fraud is obliged, under Order VI Rule 4 CPC, to give particulars of the pleaded fraud - with dates and items, in the pleading. The pleadings of the defendant, in the written statement / counter claim do not even make out a case of fraud. In any event, the fraud, intimidation, illegality, etc referred to in proviso 1 to Section 92 relates to the execution of the instrument/ document. It is not the defendant's case that when he executed the sale deed, he did not know that it is a sale deed that he was executing. It is not the defendant's case that he is unlettered or illiterate or that he did not read, or could not read the instrument in question. He does not claim that the sale deed was executed in an intoxicated or unsound state, or under duress or coercion exercised by the plaintiffs, or anyone else. The defendant knew the fact that he was executing an instrument of ....
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....ied in them by the act of the parties. (See McKelvey's Evidence, p. 294.) As observed in Greenlear's Evidence, p. 563, one of the most common and important of the concrete rules presumed under the general notion that the best evidence must be produced and that one with which the phrase ―best evidence‖ is now exclusively associated is the rule that when the contents of a writing are to be proved, the writing itself must be produced before the court or its absence accounted for before testimony to its contents is admitted. 17. It is likewise a general and most inflexible rule that wherever written instruments are appointed, either by the requirement of law, or by the contract of the parties, to be the repositories and memorials of truth, any other evidence is excluded from being used either as a substitute for such instruments, or to contradict or alter them. This is a matter both of principle and policy. It is of principle because such instruments are in their own nature and origin, entitled to a much higher degree of credit than parol evidence. It is of policy because it would be attended with great mischief if those instruments, upon which men's ri....
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....nder Order 10 Rule 2 CPC, the plaintiffs pressed for passing of a decree on admission. The court rejected the defence set up by the defendant with regard to the alleged loan transaction by observing that: "27. There is absolutely not a single phrase in any of the above documents to suggest that the sum of Rs.4 crores was given as a loan by the defendant to the plaintiff. By no stretch of imagination, upon reading any of these documents, can such a transaction be said to be evident either directly or indirectly". 38. The court also dealt with the issue whether a party can give oral evidence concerning the intention of the parties at the time of the execution of a document, which is not reflected in such a document. In this context, Roop Kumar (supra) was relied upon. The court rejected the defence set up by the defendant which was contrary to the terms of the registered instruments. In the light of the above discussion, I reject the reliance placed by the defendant on the Ist proviso to Section 92 of the Evidence Act. 39. Proviso 2 to Section 92 permits the proof of execution of a separate oral agreement "as to any matter on which the document is silent", and which is....
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....nsequently, Proviso 4 has no application to the defence/ case set up by the defendant. Provisos 5 & 6 have no application to the facts of the present case, as the defendant does not plead any custom, or any issue with regard to the language used. 43. In Ramaswamy (Dead) By LRs Vs. M. Lobo (Dead) By LRs., (2001) 10 SCC 176, the defendant/ appellant was the owner of the suit property. He transferred the property in favour of the plaintiff/ respondent by a registered sale deed. The property was leased on the same day to the defendant/ appellant. On account of default in payment of rent, the plaintiff/ respondent initiated a suit for recovery of rent. One of the defences taken by the defendant/appellant was that ―the sale deed was in fact a security for the loan advanced by the respondent to the defendant/appellant and, therefore, there is no relationship of landlord and tenant between the parties". The Supreme Court rejected this argument by observing that: "This argument is noticed only to be rejected. It is not disputed that the sale deed is a registered document and, therefore, no oral evidence could be adduced to show that no title passed on to the respondent und....
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....resented, that he would get the plaintiff compensated for the losses suffered by the plaintiff by betting on cricket matches. Accordingly, the plaintiff resorted to betting on cricket games on the advice of the defendant, who turned out to be a bookie. The plaintiff claimed that though, initially, he made profits, eventually he lost heavily. He claimed that he gave some jewellery to the defendant and also executed documents for transfer of property in the name of the brother-in-law of defendant no.1 without receiving any consideration therefor. He also issued a blank cheque from the account of plaintiff No.2. The plaintiff filed a suit to seek cancellation of documents executed and got registered by him, recovery of Rs.25 lacs and permanent injunction to restrain the defendants from selling or alienating their properties. 47. After assessing the documents relied upon by the plaintiff, the court posed the question - whether the court should allow its time to be wasted when the plaintiff had not produced material documents and had not given any explanation for their non-production. The court answered the said question in the negative. The court observed that, "The Court will not a....
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....as no right to approach the court and can be summarily thrown out at any stage of litigation. It was also noted that the process of the court is being abused - property grabbers, tax evaders, bank loan dodgers and other unscrupulous persons from all walks of life find the court process a convenient lever to retain the illegal gains indefinitely. I am also tempted to refer to Ram Sewak Vs. Ram Charan AIR 1982 Allahabad 177. It was a case of concealment of profits; the parties had been keeping double set of accounts for evading payment of income tax and sales tax. The Lower court reported the matter to the Taxation Authority. The High Court held that the Courts should have refused to entertain the suit on the ground of public policy, as it involved directing the recovery of an amount found to be due to either party as a share of the profits which had been deliberately concealed by the parties from the books of account in order to evade the payment of taxes. It was held that no Court can countenance a deliberate evasion of tax laws of the country and to lend the aid of the court for recovering an amount which had been deliberately kept concealed by the parties in order to evade paymen....
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....8, the Supreme Court analysed the provisions of the Transfer of Property Act in respect of a "sale" of an immovable property. The Supreme Court, inter alia, observed in para 11 as follows: "11. ... ... .... It follows that on execution and registration of a sale deed, the ownership title and all interests in the property pass to the purchaser unless a different intention is either expressed or necessarily implied which has to be proved by the party asserting that title has not passed on registration of the sale deed. Such intention can be gathered by intrinsic evidence, namely, from the averments in the sale deed itself or by other attending circumstances subject, of course, to the provisions of Section 92 of the Evidence Act, 1872." 51. The intrinsic evidence on which the defendant seeks to place reliance is, firstly, the fact that the sale consideration was paid in installments spread between February 2011 and October 2011 by 24 different cheques. Secondly, the defendant claims that though the sale deed itself records the delivery of possession of the suit property to the plaintiff, as a matter of fact, the same was not so delivered. Thirdly, the defendant claims that....
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....gistration of the sale deed, though the sale deed records that possession stands delivered, the possession was, in fact, not delivered. Once again, I may note that there are disputes as to the reason why actual physical possession was not delivered at the time of execution and registration of the sale deed. While the plaintiff claims that it was not so delivered on account of excuses given by the defendant, and the assurance given by him that he would deliver possession later; the defendant claims that as the transaction was not that of sale, the possession was not liable to be delivered. Be that as it may, even if were to be accepted that possession was never delivered to the plaintiff, that fact would not deprive the plaintiff to claim ownership on the basis of their title derived from the sale deed, and to claim possession of the suit property from the defendant, since the defendant has not set up any defence to claim possessory rights in the suit property. 54. The non delivery of possession by the defendant to the plaintiffs does not by itself, or cumulatively with the other factors pointed out by the defendant, lead to the conclusion that the transaction between the parties....
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....s validity or effectiveness is required by law to be given in writing, no modification or alteration or substitution of such written document is permissible by parol evidence and it is only by another written document that the terms of the earlier document can be altered, rescinded or substituted. The Supreme Court also held that parol evidence cannot be permitted to substantiate the subsequent oral agreement where the original agreement is contained in a registered document. This is not permitted by Section 92(4) of the Evidence Act. The terms of a registered document can be altered, rescinded or varied only by subsequent registered document and not otherwise. If the oral arrangement is allowed to be substantiated by parol evidence it would mean re-writing of the registered document which is not permissible". 56. Mr. Mittal has placed before this court merely a head note of a decision of the Andhra Pradesh High Court in Yerram Krishna Rao & Ors. V. Muttamalla Narasamma & Anr., AIR 2009 NOC 580 (A.P). From the head note, it appears that the plaintiff claimed to have executed the sale deed as security for loan availed of by her. The plaintiff was in possession of the property. Th....
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....f the transaction. 60. Firstly, I may observe that the real issue in Jayalakshmi Trading Co. (supra) was with regard to the admissibility of certain documents. Some of the defendants had filed an application under Order XIII Rules 3 & 6 CPC to reject some of the documents tendered in evidence by the plaintiff's witness. In any event, the aforesaid observations do not come in the way of plaintiff and do not support the defendants case, for the reason, that the defence set up by the defendant is squarely prohibited from being raised by Sections 91 & 92 of the Evidence Act. The defendant is precluded from contending that the real transaction between the parties was a loan transaction as the sale deed in question stares in the fact of the defendant while raising such a defence. Moreover, there is no ambiguity in the language employed by the parties in the sale deed. The same is absolutely clear and explicit. 61. Reliance placed on Tulsi and Others Vs. Chandrika Prasad and Others, (2006) 8 SCC 322, by learned counsel for the defendant is also of no avail. In this case the document was described as a sale deed. However, the terms contained in the deed provided that if the entire co....
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....ompletely belied by the prior stand and assertions of the defendant. 24. It is well settled that the oral stipulations when pitched against the written contract, would have to give way to the terms and conditions of the written statement which alone will bind the parties and nothing further. In this behalf, Section 91 and 92 of the Indian Evidence Act, 1872 need no elaboration. Hence the written statement really discloses no defence and such pleas have been set up only in an attempt to protract and delay the trial. If such a defence is examined on the principles applicable to an application on such facts seeking leave to defend in a suit under Order 37 of the CPC, this Court would have had to hold that the defendant has no defence and the pleas set up are illusory and moonshine.‖ 64. In Sharex Acting Through Vinod Kumar Chadha Vs. Sudershan Suri, 170 (2010) DLT 600, the learned Single Judge rejected the plea of the appellant on the premise that the said plea was belied by the terms of the lease deed, the execution of which had been unequivocally admitted by the appellant. Reliance was placed on Parivar Seva Sansthan v. Dr (Mrs.) Veena Kalra & Ors., 2000 (54) DRJ (....
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....in favour of the plaintiffs under Order 12 Rule 6 CPC and, whether the counter claim of the defendant is liable to be rejected under Order 7 Rule 11 CPC. In Parivar Seva Sansthan (supra), a Division Bench of this Court held as follows: "9. Bare perusal of the above rule shows, that it confers very wide powers on the court, to pronounce judgment on admission at any stage of the proceedings. The admission may have been made either in pleadings, or otherwise. The admission may have been made orally or in writing. The court can act on such admission, either on an application of any party or on its own motion without determining the other questions. This provision is discretionary, which has to be exercised on well established principles. Admission must be clear and unequivocal; it must be taken as a whole and it is not permissible to rely on a part of the admission ignoring the other part; even a constructive admission firmly made can be made the basis. Any plea raised against the contents of the documents only for delaying trial being barred by the section 91 and 92 of Evidence Act or other statutory provisions, can be ignored. These principles are well settled by catena of d....
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....eading in force at the time they are deemed to have admitted by their pleadings: Provided that the court may, in its discretion, require the facts admitted to be proved otherwise than by such admission." 26. The proviso to this section specifically gives a discretion to the court to require the facts admitted to be proved otherwise than by such admission. The proviso corresponds to the proviso to Rule 5(1) Order 8 CPC. 27. In view of the above, it is clear that the court, at no stage, can act blindly or mechanically. While enabling the court to pronounce Judgment in a situation where no written statement is filed by the defendant, the court has also been given the discretion to pass such order as it may think fit as an alternative . This is also the position under Order 8 Rule 10 CPC where the court can either pronounce Judgment against the defendant or pass such order as it may think fit." 68. In Express Towers P. Ltd. & Another Vs. Mohan Singh & Others, 2007 (97) DRJ 687 (DB), the Division Bench held that a decree can be passed by the court under Order 12 Rule 6 CPC when admissions are clear and unambiguous and no other interpretation is possible. The power t....
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....e facts of the present case. 73. So far as the plaintiff's application under Order 7 Rule 11 is concerned, the logical consequence of the defence/case of the defendant/counter claimant being held as untenable in law, would be that the said counter claim would be liable to rejected under Order 7 Rule 11 CPC for want of cause of action. The cause of action pleaded by the defendant in the counter claim is the so-called oral agreement and understanding that the plaintiffs shall re-transfer the suit property to the defendant in terms and conditions pleaded by the defendant. The defendant is precluded from pleading such an agreement, arrangement or understanding. As already noticed above, no other cause of action or basis for the reliefs sought in the counter claim has been disclosed. It is clear that no cause of action has arisen in favour of the defendant to seek the cancellation of the sale deed dated 01.11.2011 registered on 02.12.2011, in respect of the suit property, or to seek the execution of a fresh sale deed in favour of the defendant by the plaintiff. No cause of action has arisen to require the plaintiffs to return all the original chain of documents in respect of the suit....