Vridambal and another vs Anjalai and 3 others

S. Ashok Kumar, J.—The unsuccessful plaintiffs before the two courts below are the appellants herein. The plaintiff filed the suit for

declaration of title to the suit property and for permanent injunction against the defendants. According to the plaintiff, the items 1 and 2 of the suit

and other properties originally belonged to the first defendant. Both the suit items bear the same survey number i.e., old S. No. 110/6 and new S.

No. 520/9. Item-1 is an extent of 0.33 cents, while item 2 is 0.15 cents. Both together form the southern half of the entire survey number whose

total extent is 0.96 cents. While so, under a registered sale deed dated 14.2.1983, the first defendant sold item 1 to the plaintiff for a sale

consideration of Rs. 6600/=. The said property is mentioned as Schedule A in the sale deed. The properties mentioned as Schedule B are offered

as security which includes item 2 to the suit. As undertaking by the plaintiff he has also discharged the mortgage dated 11.6.1982 in favour of one

Sivaraman. He also discharged the discharge receipt dated 17.4.1983 and took back the original mortgage deed. By another registered sale deed

dated 7.7.1983 the plaintiff has purchased item 2 in the suit from the first defendant for a sale consideration of Rs. 3000/=. Thus, both the sale

deeds are true and valid and are fully supported by consideration.

In pursuance of the sale deeds the plaintiff took possession of the respective items and is in possession and enjoyment of the same. Patta

Number for both items is 1570. The plaintiff has paid the entire arrears of land revenue along with the kist for fasli 1394. He has raised crops for

the past two years. Thus, the first defendant having executed the sale deeds in favour of the plaintiff he is estopped from denying the plaintiff''s title.

However, the first defendant with ulterior motive is attempting to trespass into the suit properties and hence the suit for the above stated reliefs.

The first defendant contested the suit stating that though he has executed the sale deeds, the plaintiff has retained a sum of Rs. 4375/= from the

total sale consideration. The defendant had obtained a loan of Rs. 3750/= from the Tamil Nadu Khadi Board by mortgaging the suit properties. At

the time of execution of sale deeds, the total amount payable by the defendant to the Khadi Board was stood at Rs. 4375/= and despite the

plaintiff agreed to settle the loan amount by executing an agreement on 30.7.1983, he has not settled the same and the Khadi Board has issued

notice to repay a sum of Rs. 4856.9. Therefore, without repaying the loan the declaration suit is bad in law. Further, the plaintiff also did not

release the mortgaged properties and when questioned by the defendant, the plaintiff filed the suit. Further, till repayment of the loan amount of Rs.

4,375/= to the Khadi Board, the defendant is entitled to 18 percent on the said sum. The defendant only expects the plaintiff to act as per the

terms and conditions of the sale deed agreement and denied any attempt made by him to trespass into the suit properties.

After the death of the defendant his legal heirs were impleaded and the 4th defendant filed an additional written statement taking a new plea that

the suit properties are joint family properties consisting of himself, his brother and father and the first defendant was leading a wayward life and the

sale in favour of the plaintiff is not for the benefit of the joint family and therefore the sales are not binding on them. The first defendant, spent the

sale consideration sums for immoral and illegal purposes. At any rate the plaintiff has not discharged the government loan and he has unjustly

enriched himself.

On a consideration of the oral and documentary evidence, the trial court dismissed the suit holding that the plaintiff is not entitled to any of the

reliefs claimed since he has not discharged the debt to the Khadi Board as agreed to by him under Ex.B.1 and further directed the plaintiff to pay

the sum of Rs. 4,375/= with 18% interest to the 4th defendant, who shall in turn settle the loan amount. On appeal by the plaintiffs, the first

appellate court also concurred with the findings of the trial court and dismissed the first appeal. However, the first appellate court deleted the

direction given by the trial court with respect to payment of the sum of Rs. 4,375/= with 18% interest. Yet, with regard to the rejection of the

reliefs of declaration and permanent injunction, the legal heirs of the plaintiffs have preferred this second appeal.

At the time of admission of this Second Appeal, the following substantial questions of law we''re framed by this court:

i) Whether the defendants could be permitted to plead any alteration or addition to the consideration specified under Exhibit A.1 and A.2 by

reference to Exhibit B.1?

ii) Whether the alleged undertaking to discharge the debt of the vendor to the Khadi Board under Ex.B.1 after the execution of the sale deeds not

gratuitous and hence not enforceable?

iii) Whether the failure to discharge an alleged debt of the vendor by a transferee defeat the vesting of title to the immovable property covered

under the sale deeds?

As regards the contention that the suit properties are joint family properties and the sale deeds executed by the first plaintiff in favour of the

plaintiff being not for the welfare of the family members, the sale deeds will bind them has been rightly negatived by the courts below as there was

no proof to substantiate the said contention.

Secondly, both the courts have concurrently found that without discharging the mortgage debt to the Tamil Nadu Khadi Board, as agreed by the

plaintiff under Ex.B.1, dated 30.7.1983, the plaintiff is not entitled to the reliefs of declaration of title to the suit properties. But, it is pertinent to

note that Ex.B.1 is only subsequent to the two sale deeds, namely Exs.A.1 and A.2, under which, the first defendant executed the suit properties in

favour of the plaintiff.

Learned counsel for the appellant relied on the decision of the Apex Court in Sri Meenakshi Sundareswarar Devasthanam Vs. Palaniswamy and

Others, to hold that when the recitals are unambiguous and that the parties have expressed no intention that unless the loan is to be discharged, the

title to the suit properties will not pass to the vendee, it cannot be said that title did not pass on to the vendee, nor a suit for declaration is not

maintainable. In the above said decision, the Hon''ble Supreme Court also held that delay in redeeming the mortgaged properties cannot be

construed as default in payment of consideration and the same will not be fatal to lay the suit, nor it is open to the vendors to unilaterally cancel the

sale deed by a deed of cancellation.

In Chellappa Gounder (died) and others Vs. Ramasami Gounder alias Karupa Gounder (died) and others, reported in 1998 (II) MLJ 372,

which is a case in which the plaintiff has discharged the debt and no consideration had passed on the sale deed, and when the question arose

whether valid title passed on to the plaintiff, this court while referring to Sections 54 and 58 of the Transfer of Property Act held that when the

document does not say that in case consideration is not passed or in case the plaintiff fails to discharge the debt, title will not pass, whereas the

document says that in consideration of Rs. 3,000/= the executants hereby absolutely convey their title to the property to the plaintiff and that he

may deal with the same in any manner he likes with the further declaration that on and from the date of conveyance, they ceased to have any right

over the same, and there being no contract or statement to show that the document will come into effect only on payment of consideration, it

cannot be held that title did not pass on the execution of the sale deed.

In Rajagopal and Another Vs. Kaliaperumal, , in a similar case, this court held as follows:-

In a given case, whether the title has passed on execution of a sale deed depends on the intention of the parties with which they executed the sale

deed and the same has got to be gathered primarily from the recitals in the sale deed, and when the balance is tendered within a reasonable time,

the tile would pass without fail, irrespective of a refusal o the vendor to receive the money. It is true that under a sale deed on the execution and

registration there is a prima facie completion of transfer of title to the vendee. It cannot be disputed that mere non passing of consideration will not

stop the passing of the title, as the sale of immovable property may be made in exchange of the consideration already aid or promised to be paid in

future. In order to decide whether the execution and the registration of a sale deed have actually passed the title to the vendee, the real question

would be whether the vendor really intended to transfer the4 ownership by mere execution and registration of the sale deed or it was agreed upon

to do so, only after the receipt of the consideration as a prior condition would depend upon the terms of the contract between the parries. If the

sale deed clearly stipulates, as in the instant case, that that title to and the ownership of the property would vest in the vendee only after the

payment of the balance of consideration, the reasonable and possible inference under such situation would be that until the said payment is made

there was no effective transfer of ownership"".

The above three decisions would only reiterate the well settled legal position that unless there being a specific recital in the sale deed, as to the

discharge of any mortgage or prior debt by the parties, the title naturally pass on to the vendee. In the case on hand also, a perusal of sale deeds

would only go to show that there was no such intention on the part of the parties namely, discharging the loan amount as a precondition for the

transfer of title of the suit properties. Therefore, in the absence of any specific recital showing the intention of the parties, the title of the suit

properties has been transferred to the plaintiff on his paying the part of sale consideration after discharging some other mortgages.

However, subsequently, under Ex.B.1 the plaintiff executed an agreement by which he has agreed to discharge the debt due to the Khadi

Board. The recital found therein is that the first defendant has failed to inform the same to the plaintiff while executing the sale deeds. It is the first

defendant''s case that notice has been sent by the Khadi Board requiring repayment of Rs. 4,856.9 and it is the case of the defendants that the

plaintiff has retained a sum of Rs. 4,375/= out of the sale consideration amount. However, the first defendant has not filed any counter claim, nor

paid the necessary court fee and substantiated his claim in that respect. On that ground, the first appellate court disagreed with the direction given

by the trial court to the plaintiff to repay the sum of Rs. 4375/= with 18% interest, which has been retained by him. Further, a perusal of recitals

found in Ex.A.1 sale deed would show that the first defendant had already made it clear that ""after receipt of the balance of sale consideration he is

delivering possession of the suit property and the plaintiff is at liberty to deal with the property in any manner as he likes and if there is any

encumbrance involved in the suit A-Schedule property, the same will be borne out by selling the B Schedule property which is given as security.

Therefore, apart from Ex.B.1 undertaking, since a charge had already been created even prior to the sale deeds over the suit properties, by

mortgaging the suit properties to the Khadi Board, to get a clear title, besides taking into consideration of the fact that B-Schedule property has

been given as a security to settle the encumbrance, if any, created over the suit A-Schedule property, the plaintiff alone is liable to discharge the

mortgage debt due to the Khadi Board. In the above circumstances, though the plaintiff is entitled to the relief of declaration of title to the suit

properties, as title has been transferred as laid down in the decisions cited above, however, he will get clear title to the suit properties only on his

discharging the debt to the Khadi Board. However, at the time of argument, it was represented that the debt towards the Khadi Board had been

given relief by the Government. If it is so, the amount lying in the hands of the plaintiff for payment to the Khadi Board as per Ex.B.1 agreement is

to be paid to the defendant. Therefore, the plaintiff is bound to pay the amount of Rs. 4,375/= with interest at 12% p.a., till payment of the same to

the defendant. Because, the plaintiff cannot take undue advantage of the debt relief given to the parties. If at all, any relief is granted, it is to the

defendant who mortgaged the property to the Khadi Board. In the result, the second appeal is allowed setting aside the judgment and decree

dated 7.4.1995, made in A.S. No. 54 of 1994 by the learned Additional Sub Judge, Cuddalore. The suit is decreed as prayed for. No costs.