Sohan Raj and Another vs Amar Chand and Others

Milap Chandra Jain, J.—This revision petition has been filed against the order of the learned Additional District Judge No. 1, Jodhpur dated October 5, 1991 by which he has held that the document in question did not require registration. The facts of the case giving rise to this revision petition may be summarised thus.

The Central Bank of India, Jalorigate, Jodhpur (plaintiff-non-petitioner No. 5] has filed a suit for the recovery of Rs. 10,40,000/- against the petitioner?, and non-petitioners No. 1 to 4 (defendants) with the allegations, in short, that the latter have obtained loan from it on the basis of eduitable mortgage of their properties by depositing their was tendered in evidence by the plaintiff. The defendants raised objection against it to the effect that it cannot be tendered in evidence for want of registration. After rearing the learned Counsel for the parties, the learned trial court held that the disputed document is not a mortgage-deed, it is simply a document reciting that mortgage has been effected by deposit of title- deeds and it is a memorandum of past transaction. Accordingly, it repelled the defendants objection by its order under challenge.

It has been contended by the learned Counsel for the defendant-petitioners that admittedly the disputed document was executed the same day the title-deeds were delivered by the defendants to the plaintiff, the equitable mortgage has been effected through this document and as such it required registration u/s 17(1), Registration Act and also stamp duty under Article 40 of the Stamp Act. He relied upon AIR 1939 157 (Privy Council) Parkash Dev Chopra Vs. The new bank of India Ltd., New Delhi and Others, , Ved Parkash Sawhney Vs. R.A. Wania and Another, , Bihari Lall Lahoty Vs. Harendra Nath Sharma and Others, and Ishwar Dass Malhotra Vs. Dhanwant Singh and Others, .

4 . In reply, it has been contended by the learned Counsel for the plaintiff-non-petitioner that the disputed document is a memorandum which was prepared for record by the plaintiffs'' Manager, it simply recited past transaction regarding equitable mortgage, equitable mortgage was not effected through it and as such it neither required registration nor any stamp duty. He relied upon Deb Dutta Seal Vs. Ramanlal Phumra and Others, and Radha Kishan v. Jwala Prasad Shiv Prasad and Ors. AIR 1966 Raj 219.

It would be best to quote here the disputed document in extenso. It runs as under:

Memorandum of deposit of Title Deed No. 151- dated 13th May, 1980.

Mr. Sohan Raj later S/o Shri Megh Rajji Tater, resident of Jodhpur at plot No. 713 A, 7th Pal Road, Sardarpura and partner of M/s Sohan Guwar Gum Products, Plot No. E-33. Marudhar Industrial Area, II Phase Basni, Jodhpur attended this office on this day the 13th may, 1980 and deposited with us the documents set out below relating to the plot of land measuring 45.2 Sq. meters and situated at E-33, Marudhar Industrial Area, II Phase, Basani, Jodhpur and leased out to M/s Sohan Gaur Gum Products by Rajasthan State Industrial and Mineral Development Corpn. Ltd., with us as security for and with the sole intention to creat equitable mortgage of the said property situated at plot No. E- 33, along with buildings, and premises standing thereon and hereinafter to be erected to secure the balance due under the various loan facilities to the extent of Rs. 15.55. lacs (Rupees Fifteen lacs fifty five thousand) in the name of M/s Sohan Guwar Gum Products at our branch together with interest thereon with all costs, charges, expenses to be incurred by or/and payable to us:

Detail of documents deposited

Original Registered Stamped Lease Deed, dated 15.4.1980 in respect of plot No E-33, Marudhar Industrial Area, II Phase, Basani, Jodhpur executed by and between Rajasthan State Industrial and Mineral Development Corpn. Ltd. and M/s Sohan Guar Gum Products.

The photostat copy of the document bears the signature and seal of the Branch Manager, Central Bank of India, Industrial Area, Jodhpur. The signature of the defendant Sohan Raj Tater partner M/s Sohan Guwar Gum Products, Jodhpur who attended the plaintiff Bank and deposited the title-deeds of the plot and buildings with the bank does not appear on it. The words "Attended This Office", "Deposited with Us" are very significant. They clearly go to show that the equitable mortgage had already been effected when this document was prepared. It cannot, therefore, be said that the equitable mortgage was in fact effected by this document. It did not go to create, declare, assign, limit or extinguish any right, title or interest to or in any immovable property, Clause (b) of subsection (1) of Section 17 of the Registration Act was not attracted, Clause (5) of Sub- section [2] of Section 17 of the Registration Act runs as under:

(V) Any document not it self creating, declaring, assigning, limiting or extinguishing any right, title or interest of the value of one hundred, rupees and upwards to or in immovable property, but merely creating a right to obtain another document which will A/hen executed, created, declare, assign, limit or extinguish any such right, title or interest; or

This document did not form an integral part of the said transaction.

The documents which were subject matter in Deb Dutta Seal Vs. Ramanlal Phumra and Others, , and Radha Kishan v. Jwala Prasad AIR 1966 Raj 219 , are similar to the disputed document and it has been held that they did not require either registration or stamp duty. AIR 1939 167 (Privy Council) has duly been considered in both these cases. It has been observed in Para 10 of Deb Dutta Seal Vs. Ramanlal Phumra and Others, , that if such document is not an operative instrument and is merely evidential, it requires registration, the decision AIR 1939 167 (Privy Council) cannot be approved. In para No. 22, the following observations of the AIR 1939 167 (Privy Council) have beer quoted:

The memorandum does not merely evidence a transaction already completed: its language is operative, It is contractual in form, and it embodies an agreement that the title deeds in question are to be held as security for the advance made, and it speaks of the moneys hereby secured.

In Ishwar Dass Malhotra Vs. Dhanwant Singh and Others, , it has been held that the disputed document was contemporaneously written and gave particulars of the bargain of the contract between the parties. In Bihari Lall Lahoty Vs. Harendra Nath Sharma and Others, , the disputed document was executed for repayment for mortgaged dues and payment of interest thereon and as such it was held inadmissible for want of registration. In Parkash Dev Chopra Vs. The new bank of India Ltd., New Delhi and Others, , the disputed letters were written after the title deeds were deposited with the Bank, no terms of mortgage were embodied in them and the parties did not intend that the letters to be the depository a transaction of equitable mortgage. Similar is the case here. Kakoo Shah Uttam Chand and Others Vs. Kamla Wati and Others, , does not help the petitioner. On the contrary, it helps the non-petitioner Bank. It has been observed in Veeramachineni Gangadhara Rao Vs. The Andhra Bank Ltd. and Others, , as follows:

Therefore, the crucial question is: did the parties intend to reduce their bargain regarding a document requires registration. If on the other hand, its proper construction and the surrounding circumstances lead to the conclusion that the parties did not intend to do so, then, there being no express bargain, the contract to create the mortage arises by implication of the law from the deposit itself with the requisite intention, and the document being merely evidential does not require registration.

It is clear from a perusal of the impugned order that no objection was taken that the document is not admissible in evidence for want of requisite stamp duty. As already held above, the disputed document is simply a memorandum of past transaction. It does not fall within the meaning of mortage-deed as defined in Section 2 [17], Stamp Act. It is neither an agreement relating to deposit of title-deeds within the meaning of Article 6 nor a mortgage-deed within the meaning of Article 40 of the Stamp Act.

Consequently, the revision petition is dismissed with costs.