M.L.Goel vs Mukhtiar Singh

H.K. Sandhu, J.

The brief, facts of the case giving rise to this appeal are that Mukhtiar Singh respondent was the owner of a house bearing No. 171 situated in Sector20A, Chandigarh. He agreed to sell his house to Shri M.L. Goel for a sum of Rs. 78,000/ vide agreement Exhibit PA. Sale deed was to be executed upto May 21, 1977 and Mukhtiar Singh received a sum of Rs. 20,000/ as advance money. The balance amount was to be paid at the time of registration of the sale deed. When the agreement to sell was executed it was mentioned therein that the house which was to be sold was free from all encumbrances. The sale deed could not be executed by the fixed time. So, in continuation of the original agreement another agreement was executed on September 20, 1977 whereby the time for the execution of the sale deed was extended upto April 21, 1979, and Mukhtiar Singh received a further sum of Rs. 9000/. Shri M.L. Goel alleged that although it was represented that the house to be sold was free from all encumbrances yet later on it was found that the house was under mortgage with one Swaran Kaur who had already obtained a decree for a sum of Rs. 47000/. This fact was admitted by Mukhtiar Singh in the draft sale deed Exhibit PF and he agreed that the amount of Rs. 47000/ may be paid to the mortgagee. Shri M.L. Goel thus filed a complaint against Mukhtiar Singh for his prosecution under section 420 of the Indian Penal Code. He pleaded that had he known about the mortgage of the house earlier he would not have parted with an amount of Rs. 29,000/ nor he would have agreed to purchase the house. It was only on account of this false representation by Mukhtiar Singh that he agreed to purchase the house. The object of Mukhtiar Singh was to cheat him and his wife who was also a copurchaser.

After recording preliminary evidence the learned trial Magistrate found that no case was made out against Mukhtiar Singh but in a revision in the High Court it was ordered that the Magistrate was to proceed according to law. Mukhtiar Singh was then tried for an offence under section 420 of the Indian Penal Code and was sentenced to undergo rigorous imprisonment for one year. Aggrieved by this judgment dated March 10, 1982, passed by Shri L.R. Roojam, Judicial Magistrate Ist Class, Chandigarh, Mukhtiar Singh filed an appeal which was accepted by Shri A.S. Garg, the learned Additional Sessions Judge, Chandigarh and Mukhtiar Singh respondent was acquitted. It is this judgment recording acquittal of the respondent dated 1941992 which is assailed by Shri M.L. Goel, complainant by way of this appeal.

We have heard Shri Ravinder Chopra, Advocate with Mrs. Payal Kapoor, Advocate for the appellant and Shri A.K. Mittal, Advocate with Mr. G. S. Sandhawalia, Advocate for the respondent and have also carefully perused the record of the trial Court.

The learned counsel for the appellant referred to agreement Exhibit PA wherein it was specifically mentioned that the property to be sold was free from all sorts of encumbrances i.e. sale, gift, mortgage, will, claims etc and it was contended that on this assurance of the respondent the appellant and his wife agreed to purchase the house for a sum of Rs. 78,000/ and out of the sale consideration, paid an amount of Rs. 20000/ as earnest money. Later on the time for execution of the sale deed was extended and a further sum of Rs. 9000/ was paid to the respondent as part of the earnest money. In the month of March 1978, the appellant came to know that the house was already mortgaged with one Swaran Kaur for a sum of Rs. 37,500/ and this fact of mortgage was deliberately concealed by the respondent when the agreement to sell was executed. In fact Swaran Kaur had filed a suit for the recovery of mortgage loan and she had obtained a decreeagainst the respondent. If these facts had been disclosed by the respondent the appellant would not have entered into an agreement to purchase the property nor he would have parted with an amount of Rs. 29000/. Before dealing with the contention of the learned counsel for the appellant it will be appropriate to refer to the provisions of section 415 of the Indian Penal Code which are in the following terms :

"Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person, shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, wind reputation or property, is said to "cheat."

The Explanation to this Section provides that a dishonest concealment of facts is a deception within the meaning of this section. Thus the essential ingredients of cheating are (a) dishonest intention upon which (b) a false representation is based and in consequence of which (c) valuable property is delivered to the person making the false representation. Dishonest intention is further to be judged by finding whether there was intention of causing wrongful gain to one person and wrongful loss to another person. In the instant case when the agreement Exhibit PA was executed by Mukhtiar Singh this fact was concealed that the house in question was under mortgage with Swaran Kaur and that she had obtained a decree for the mortgage amount. This fact was in the knowledge of the respondent that the house was not free from encumbrance and that a civil suit was pending against him for the recovery of the mortgage amount. However he did not make mention of these facts to the appellant nor the same were incorporated in Exhibit PA. But it cannot be said that on account of this concealment the appellant was made to part with a sum of Rs. 9000/.

In fact the appellant and his wife were to purchase the house for Rs. 78000/ and they paid the amount of Rs. 20,000/ as earnest money. It was the appellant who could not arrange the balance sale consideration when the time for executing the sale deed was extended and then he paid another sum of P,&. 9000/ by way of earnest money. He was to pay Rs. 8000/ for getting a title to the house. It is not a case where the title to the property had passed to someone else. Even if the house was under mortgage, the respondent could still effect its sale by keeping the mortgage amount with the vendees for payment to the mortgagee and that is what was done when draft sale deed Exhibit PF was executed. The execution of this document is admitted by Shri M.L. Goel. It was specifically mentioned in Exhibit PF that Swaran Kaur had obtained a decree for a sum of Rs. 47000/ on the basis of a mortgage deed and this amount will be paid to her by the purchasers. Exhibit PF is dated May 3, 1978 and was duly signed by Shri M.L. Goel. The appellant was not to pay any extra amount due to the concealment of the fact of mortgage. The sale transaction was to take place still for the same amount and no wrongful loss was to occur to the appellant nor the respondent was to set a wrongful gain and thus there did not remain any question of dishonest intention. Exhibit PF was executed in continuation of the agreement Exhibit PA and when the appellant willingly executed that document and admitted its contents he could not assert that he was in any way misled and was made to part with a sum of Rs. 29000/. In the case of Sirikrishan and others v. Empero, AIR 1934 Peshawar 5, the accused who was charged under section 420 Indian Penal Code, for inducing inspector General of Police to transfer a lorry to their name by producing receipt signed by F in whose name lorry stood, the following findings were given :

"It being admitted that the document was signed by F so far as the office of the I. G. Police was concerned that was sufficient authority for them to transfer the lorry in the name of the accused. Neither the I.G. Police nor his subordinates were incurring any legal liability by effecting such transfer nor the I.G. Police or his office suffered damage or harm in body, mind, reputation or property. The accused could not therefore the convicted.".

Similarly in the present case no monetary loss was caused to the appellant. The appellant obtained title to the property on payment of agreed consideration so it was a savor of vindictiveness that he was still pressing the proceedings against the respondent. The learned trial Court rightly recorded acquittal of the respondent.

We do not find any merit in this appeal and dismiss the same.