ABDUL KASHEM KHAN & ORS. vs NUR ISLAM KHAN & ORS.

SHIVAKANT PRASAD, J

This appeal is directed against the judgment and decree dated 9th March, 2007 passed by First Court of Additional District Judge, Howrah in Title

Appeal No. 32 of 2006 reversing the judgment and decree dated 31st January, 2006 passed by Civil Judge (Senior Division), Uluberia, Howrah in Title

Suit No. 101 of 2000 inter alia on the grounds that the learned Court of Appeal has failed to consider the moot issue as to whether a particular

transaction is a loan transaction or an out and out sale, as enunciated in the case of Buddhu Shaw vs. Mongal Shaw reported in 70 Calcutta Weekly

Notes, 982.

Brief facts leading to this case is that the suit property belonged to four brothers namely, Chunilal Das, Nandalal Das, Mihirlal Das and Distupada Das

collectively having half share and the rest half share belonged to Benugopal Halder and Tarani Halder. Out of a mutual partition amongst them

Chunilal and his brothers got Plot No. 1183 and Benugopal and his brother got Plot No.1182 of Mouza- Bekutal, P.S. Uluberia and Chunilal and his

brothers jointly owned and possessed 'A' scheduled property.

Subsequently, Mihirlal and Bistupada sold their half share in the 'A’ scheduled property to Khorsed Ali vide registered sale deed dated 25.3.1958

(Exhibit-2). Khorsed Ali died leaving behind his five sons i.e. the plaintiffs no.1 to 5. Chunilal and Nandalal also transferred their rest half share in the

suit property to Noor Islam Khan and others.

At a subsequent stage 'A' scheduled land was entirely recorded in the names of the defendants erroneously and on that basis defendants held out

threat to dispossess the plaintiffs from the 'A’ Scheduled property which included the plaintiffs half share. The plaintiffs requested the defendants

for partition of their share by metes and bounds but they paid no heed to the same, hence the suit was filed before the Trial Court.

Defendant Nos. 2 and 3 contested the suit by filing written statement and denied all material averments of the plaint and contended inter alia that the

suit was not maintainable as bad for defect of parties.

Specific case of defendants is that Chunilal and his three brothers were the owners in possession of suit Plot No. 1183 and by a mutual separation,

Bishnupada and Mihirlal started cultivating eastern half of the suit plot and subsequently they mortgaged that portion with the predecessor-in-interest

of the plaintiffs, a licensed money lender to meet their financial crunch by taking loan of Rs. 300/- and a ostensible sale deed was executed by them

with an oral agreement for repurchase on condition of interest payable at Rs. 200/- and for redemption within a span of seven years.

It is contended that the said deed dated 25.3.1958 was not an out and out sale deed because the land value at the relevant time was more than Rs.

1,500/- whereas the consideration was quite insufficient. Said Mihirlal and Bistupada bore all expenditure for preparation of said deed. Khorsed never

possessed the suit property and Bistupada and Mihirlal were paying interest to said Khorsed regularly. As such neither Khorsed nor his legal heirs

became owner of the suit property in respect of half share.

It is also contended that by way of amicable arrangement Mihirlal and Bistupada got 19½ decimal each in the suit property. Mihirlal started

possessing west of the western half of the suit property and Bistupada started possessing east of the western half of the suit property within the

knowledge of the plaintiffs as well as their predecessor-ininterest.

Mihirlal transferred his share which he got by way of amicable arrangement to his son by executing a deed of gift dated 17.3.1975 and the share of

Bistupada was inherited by his widow Mahamaya Dashi on his death. Said Mahamaya transferred 19½ decimals i.e. her entire share in the land by

a registered deed dated 16.7.1986 for a consideration of Rs. 4,000/-(Exhibit-G). The defendants knew that Bisnupada had redeemed his mortgaged

property. Thus, it is contended that defendants are in possession of the suit Property and their names are recorded in LR ROR and plaintiffs have no

right title interest and possession in the suit property.

On the pleadings above, learned Trial Court framed the following issues:

Is the suit maintainable in its present form and prayer?

Is the suit bad for defect of parties?

Whether the plaintiffs have right, title and interest in the suit property ?

Area the plaintiffs entitled to get decree as prayed?

To what other relief/reliefs Plaintiffs are entitled to get?

After taking evidence, learned Trial Court decreed the suit by declaring plaintiffs right title and interest of their half share in the ‘A’ scheduled

property and also granted a decree of partition in preliminary form directing the parties to get the suit property partitioned amicably by metes and

bounds

Mr. Buddhadev Ghosal learned Advocate for the appellants argued that the defendants have failed to prove the existence of any debt and loan

transaction. It is also submitted that Khorsed Ali had purchased 39 decimals of land out of 78 decimals in Suit Plot No. 1183 pertaining to Khatian No.

50 for a consideration of Rs. 500/- from Mihirlal Das and Bishnupada Das at the prevailing market price vide registered deed of sale dated 25.3.1958

(Exhibit-2) whereas one Golam Khan had purchased 191/2 decimals of land for a consideration of Rs. 800/- vide registered deed of sale dated

30.3.1960 (Exhibit-B) produced by the defendants which clearly establish the fact that the price of suit land of 39 decimals for Rs. 500/- purchased by

the plaintiffs on 25.3.1958 (Exhibit- 2) was the fair market price at the relevant point of time. It is well proved that said Khorsed Ali possessed the

land purchased by him from the evidence of PW-1. It is submitted that there is no proof to show that Khorsed was a money lender.

My attention is also invited by Mr. Ghosal to the consideration amount as mentioned in registered deed of sale of 1995 and of 1986 in favour of the

defendants whereby the heirs of the vendor of plaintiffs’ father had transferred to the defendants. Therefore, the defendants cannot take the

defense that the sale deed (Exhibit-2) in favour of the plaintiffs’ father was a loan transaction in substance and not out and out a sale deed. It is

submitted that no suit has been filed under Bengal Money Lenders Act and if defendants counter claim declaring the transaction vide sale deed of the

year 1958 in the suit filed in the year 2000 is considered, then their claim is beyond the period of limitation i.e. after 42 years and is hopelessly barred

by limitation by virtue of Article 61(a) of Limitation Act which provides - to redeem or recover possession of immovable property mortgaged;

limitation is 30 years from the date when the right to redeem or recover possession accrues. Similarly, suit for foreclosure by a mortgagee, the

limitation provided under Article 63 is 30 years when the money secured by the mortgage becomes due. Therefore, the plea of the defendants taken

by them in paragraph 11 of their written statement that after separation said Mihirlal and Bistu Pada had to undergo some strenuous conditions and

had to face heavy financial crisis which propelled them to keep the said portion of land mortgaged to the plaintiffs predecessor-in-interest a money

lender by business for having taken a loan of Rs. 300/- has no leg to a stand.

On perusal of the deed of sale (Exhibit-2) there is no whisper that it is a deed of sale coupled with a condition to re-convey the suit property on

repayment of the loan amount together with the interest. Therefore, in view of the clear bar contained in Section 92 of the Evidence Act, no oral

evidence can be admitted or entertained for the purpose of contradicting, varying, adding to or subtracting from the terms of the documents excepting

in a case where the relaxation as contained in Section 40 (6) of the Bengal Money Lenders Act can be availed of and there is no room for availing the

aid of the said section by way of taking a mere defence in any suit and the defendants cannot be entitled to adduce oral evidence to contradict the

deed.

It is submitted by Mr. Ghosal as to when the relaxation under Section 40(6) of the B.M. Act vis-Ã -vis bar under Section 92 Evidence Act can be

availed of so as to admit oral evidence?

In this regard, it would be apt to reproduce the provision of Section 40(6) of the B.M. Act which reads as under â€

Notwithstanding anything contained in the Indian Evidence Act 1872 (1 of 1972), evidence adduced by the borrower in a suit to which this Act

applies or a suit by a borrower for relief under Section 36 or in any criminal proceedings U/s. 41 or U/s. 42, of any oral agreement or statement

contradicting, varying, adding to or subtracting from the terms of any document creating or witnessing a loan shall he admitted"".

Thus, it is crystal clear that evidence of any oral agreement or statement contradicting varying, adding to or subtracting from the terms of any,

document creating or witnessing a loan may be admitted only in the following suits or proceedings;

a) ""Suit to which this Act (B.M. Act) applies

b) ""a suit brought by a borrower for relief Under section 36"" of the B.M. Act.

c) ""any criminal proceedings Under Section 41."" of the B.M. Act.

Excepting in the above said cases, no oral evidence may be admitted to contradict a document.

Section 2(22) of the Bengal Money Lenders Act provides that, ""suit to which this Act applies"" means any suit or proceeding instituted or filed on or

after the 1st day of January, 1939 or pending on that date and includes a proceeding in executionâ€

 (a) for the recovery of a loan advanced before or after the commencement of this Act;

(b) for the enforcement of any agreement entered into before or after the commencement of this Act, whether by way of settlement of account or

otherwise, or of any security so taken, in respect of any loan advanced whether before or after the commencement of this Act; or

 (c) for the redemption of any security given before or after the commencement of this Act in respect of any loan advanced whether before or after

the commencement of this Act.

On the other hand, a transaction can be reopened only in a suit U/s. 36 of the Bengal Money Lenders Act which also provides that the Court shall not

reopened any transaction which has been entered into at a date more than twelve years prior to the date of suit by the parties or any person through

whom they claim. Therefore, in the case of an alleged loan transaction, the suit U/s. 36 of the Act has to be instituted before expiry of 12 years from

date of the transaction. On the other hand a suit for redemption in the case of a Mortgage by conditional sale taking the aid of Section 37A of B.M.

Act has to be instituted within a period of 30 years.

In any case, to avail the benefit of the provisions of Section 40(6) of the B.M. Act, a suit has always to be instituted by the borrower himself and he

cannot avail the benefit of the relaxation of that Section to defeat the bar U/s. 92 of the Evidence Act by way of defence in a suit brought against him.

A defendant in a suit against him on the basis of a sale deed may plead to prove that it is a mortgage transaction only in cases where the transaction is

a mortgage transaction but he shall not be required to adduce any oral evidence to contradict vary or add to the contents of a sale deed and he can

prove such transaction only by production of documentary evidence. In a case where the sale deed is accompanied with any written agreement of re-

conveyance, the bar contained in Section 58(C) of T.P. Act is relaxed by Section 37A of the Bengal Money Lenders Act. Though provision of Section

53(C) requires that sale transaction and the agreement to re-convey should be witnessed by the same document but Section 37A of the B.M. Act

provides that the agreement to re-convey may be contained in a separate document and the transaction would be deemed to be a transaction U/s.

58(C) of the T.P. Act constituting a mortgage by conditional sale. This was what the case in the decision reported in A.I.R. 1972 Cal. 542. Since

there was existence of written agreement of re-conveyance with respect to the sale deed in question by virtue of Section 37A of the B.M. Act, it

attracted the provision of Section 58(C) of the T.P. Act to prove that the transaction in question constituted a mortgage by conditional sale. In that

case the plaintiffs claimed the property on the strength of the sale deed lying in his custody, but as soon as the defendant produced his agreement of

reconveyance, the transaction instantly was proved to constitute a mortgage by conditional sale without the necessity of any oral agreement to be

adduced by the defendant. Therefore, the ratio of decision in case reported in AIR 1972 Cal. 542 did not enunciate the law that the defendant may

avail the benefit of Section 40(6) of the Bengal Money Lenders Act to adduce oral evidence to contradict a sale deed. Above all the defendants

could substantiate their claim under the Bengal Money Lenders Act by instituting a regular suit within a period of prescribed limitation, but no such suit

under Bengal Money Lenders Act was ever filed, ergo, the defendants cannot claim that the registered deed of sale dated 25.3.1958 (Exhibit-2) is a

loan in substance.

Mr. Prabal Mukherjee learned Advocate for the defendants/ respondents submitted that a decree for partition cannot be granted without impleading

the daughter of Khorsed Ali and invited my attention to averment made in paragraph 6 of the written statement of defendant no. 2 Abdul Rahim Khan

wherein it has been stated that Khorsed Ali had also four daughters namely, Zobeda, Jahura, Saira and another daughter out of whom Zobeda died

leaving her only son. As I have observed in the foregoing paragraph that Mihirlal Das and Bistu Pada Das have sold their half share by registered

deed of sale dated 25.3.1958 and delivered possession thereof to Khorsed Ali who had died leaving behind the plaintiffs as his five sons. I find that

Saira Bibi, Jahura Bibi and Zobeda Bibi the three daughters of Khorsed Ali have been impleaded vide order dated 03.11.2003 and all necessary parties

being defendant nos. 5, 6 and 7 have also been impleaded vide order no. 36 dated 10.3.2004. Therefore, it cannot be said that suit is bad for non-

joinder of necessary parties.

As regards cause of action, Mr. Mukherjee by adverting to averment made in paragraph 7 has contended that if the plaintiffs or his predecessor-in-

interest ever possessed the suit property, they could know that from whom Nandalal got half share in the suit property and they could say in which

side of the suit plot said co-sharer used to possess as per their respective share but the plaintiffs made a statement regarding clandestine arrangement

and to create the cause of action falsely alleged that defendants held out threat to dispossess them.

I do not agree with such contention. It is admitted fact that Chunilal, Nandalal, Mihirlal and Bistu Pada Das were four brothers and original owners of

the suit plot which contained an area of 78 decimals. I have found that the plaintiffs’ predecessor by the deed dated 25.3.1958 (Exhibit-2) have

purchased 39 decimals of land from Mihirlal Das and Bistu Pada Das whereas the defendants by deed dated 06.4.1960 (Exhibit-B) purchased the

share of Chunilal Das and Nandalal Das.

It further appears from the deed of 1975 (Exhibit-C) that said Mihirlal Das gifted 19½ decimals in suit Dag No. 1183 to his son Jamini Kant Das

respondent no. 5Â Â but there is no recital in the said deed with regard to earlier transaction and about execution of a deed of sale of the year 1958.

It also appears from a deed of sale dated 16.7.1986 (Exhibit-G) that widow of Bistu Pada Das namely, Smt. Mahamaya Das transferred 19½

Shatak of land in Suit Plot-1183 in favour of Abdul Rahim Khan. Noor Islam Khan, defendant no. 1 has categorically stated that he has no objection

against the averments made in the plaint in respect of the plaintiffs’ claim in the suit property. Rahim Khan, defendant no. 2 DW-1 has clearly

stated that he purchased the share of the suit property from the wife of Bistu Pada Das namely, Mahamaya Das but at the time of execution of deed

he was not aware of the fact that Bistu Pada and Mihirlal had executed a registered deed of sale in favour of Khorsed and even knowing the

existence of earlier deed in favour of Khorsed he purchased the suit property.

Learned Trial Court while considering the suit relied on a specific guideline laid down in a case reported in AIR 1980 Cal. 16 as to whether a given

transaction is a loan in substance or sale outright. It is settled law that in determining the nature and character of the transaction, factors viz. intention

of the parties, existence of debt, the period of payment, the possession of property, stipulation for payment of interest and the market price are to be

taken into consideration. On comparing the market price and consideration money as mentioned in the deeds (Exhibit-2 and Exhibit-B), learned Trial

Court in my considered opinion rightly held that the transaction in respect of the deed of sale (Exhibit-2) was outright a sale deed and not mortgage on

condition to re-convey the property, as defendants had failed to prove the debt, the period of payment, the possession of property, stipulation for

payment of interest and the market price.

In appeal the learned Appeal Court below in relying the submission made by learned Advocate for the defendants/respondents herein simply quoting

decisions in AIR 1980 Cal. 16; AIR 1999 Bombay, 207; AIR 1952 Cal. 579 and AIR 1933 Cal. 543 and basing his finding on oral testimony of DW-1

to DW-6 held that the appeal has merit and the judgment passed by the Trial Court was set aside as not sustainable in law.

I find on perusal of the judgment impugned that the learned Appeal Court below failed to consider the lis between the parties without assigning any

positive finding bereft of reasoning because the learned Court of Appeal did not specify the point of disagreement with that of the finding of learned

Trial Court save and except discussing the rival contentions of learned Advocates of the parties. The evidence and the contention as regards

redemption of mortgage even if considered for argument sake, no such case has at all been made out by the defendants/respondents.

It was for the defendants/respondents to have instituted appropriate suit within the period of limitation to substantiate their claim under the Bengal

Money Lenders Act.

Mr. Mukherjee submitted that the suit is required to be remanded to Trial Court as the written statement filed by Jamini Kanta Das on 07.02.2005 and

evidence of DW-5 have not been considered by the Trial Court together with the deed of gift (Exhibit-C), the Record-of-Right and LRROR as there

is no declaration that the LRROR is erroneous recorded. I have found that in the suit, the plaintiffs in substance prayed for partition upon declaration

of share in the suit plot on adjudication of their share and the learned Trial Court has rightly held the share of the plaintiffs on the basis of the deed of

sale dated 25.3.1958 (Exhibit-2). Moreover, record of right does not create any title nor it extinguish the title.

I am of the concluded opinion that subsequent deeds executed by Jamini Kanta Das and by Smt. Mahamaya, widow of Bistu Pada Das in respect of

the self-same land cannot take priority over the deed of sale dated 25.3.1958 (Exhibit-2).

For the reasons stated above, I hold that the learned Court of Appeal below committed substantial error of law in treating the deed dated March 25th,

1958 as loan in substance notwithstanding that no proceeding in terms of Bengal Money Lenders Act was filed at the instance of the

defendants/respondents herein and thereby committed error in reversing the judgment and decree passed by the learned Trial Judge.

Consequently, the impugned judgment dated 9th March, 2007 passed in Title Appeal No. 32 of 2006 by Appeal Court below is hereby set aside and

that of the judgement and decree dated 31st January, 2006 passed by the Trial Court in Title Suit No. 101 of 2000 is restored.

Thus, the Appeal being S.A. 401 of 2007 is allowed, however, without any order as to costs.

Certified website copies of the judgment, if applied for, be urgently made available to the parties, subject to compliance with all requisite

formalities. Â