Allahabad High Court
Mahendra Singh vs Ramesh Singh on 24 August, 2020
Equivalent citations: AIRONLINE 2020 ALL 2597
HIGH COURT OF JUDICATURE AT ALLAHABAD Court No. - 66 Reserved A.F.R. Case :- SECOND APPEAL No. - 195 of 1993 Appellant :- Mahendra Singh Respondent :- Ramesh Singh Counsel for Appellant :- S.B.Panday, Ajay Singh Sengar, Om Prakash Singh Sikarwar Counsel for Respondent :- Lallain Pd.Singh, Lallan Prasad Yadav, Yashwant Singh Hon'ble J.J. Munir,J.
1. This is a defendant's second appeal, arising from a suit for specific performance of contract.
2. The plaintiff-respondent's suit, being Original Suit no.319 of 1999, was tried and decreed by the learned Civil Judge, Kanpur Dehat vide his judgment and decree dated 03.02.1991. The plaintiff-respondent appealed to the learned District Judge, Kanpur Dehat vide Civil Appeal no.10 of 1992. The said appeal was heard and allowed with costs by the Ist Additional District Judge, decreeing the suit for specific performance of contract, vide his judgment and decree dated 31.08.1992.
3. Ramesh Singh, the plaintiff-respondent instituted Original Suit no.319 of 1990 in the Court of the learned Civil Judge, Kanpur Dehat on 31.05.1990 against Mahendra Singh, the defendant-appellant, seeking specific performance of a registered agreement to sell dated 24.06.1989, relating to an unpartitioned half share in agricultural land, detailed in Schedule क to the plaint.
4. Mahendra Singh, the defendant-appellant shall hereinafter be called, ''the defendant'. Ramesh Singh, the plaintiff-respondent shall hereinafter be referred to as, ''the plaintiff'. The registered agreement to sell dated 24.06.1986 executed by the defendant in the plaintiff's favour, shall be called, ''the suit agreement'. The property, subject matter of dispute between parties, set forth in Schedule क to the plaint, bears the following description: half share in agricultural plot no.64, admeasuring 6 bigha 4 biswa and 5 biswansi, with a total annual revenue of half part of Rs.33.25 paise, situate at Village Anwan, Tehsil Bhognipur, District Kanpur Dehat. The defendant is bhumidhar with transferable rights of the aforesaid half share in plot along with his brother, Sewa Ram. The said land is hereinafter referred to as, ''the suit property'.
5. The plaintiff's case is that the defendant is bhumidhar with transferable rights of the suit property, a right which he held on 24.06.1989. The plaintiff is a native of Village Anwan since days of his ancestors, but has meager agricultural holding. The plaintiff desired a larger holding. The defendant, on the other hand, wished to part with the suit property in order to invest in business and to meet his other needs. He disclosed his desire to sell the suit property to natives of the village, as also others in the vicinity. The plaintiff and the defendant entered into negotiations about working out a deal for the plaintiff to purchase the suit property. The parties struck bargain at a price of Rs.50,000/-.
6. In accordance with the aforesaid settlement of the transaction, the defendant executed a registered agreement to sell dated 24.06.1989 in the plaintiff's favour, covenanting to execute a sale deed, conveying the suit property to the plaintiff. Of the agreed sale consideration, the plaintiff paid to the defendant a sum of Rs.30,000/- as earnest prior to execution of the suit agreement. It is averred in the plaint that at the time of execution of the suit agreement and its registration, the plaintiff paid a further sum of Rs.15,000/- towards the agreed consideration, which the defendant received before the Sub-Registrar.
7. It is the plaintiff's case that in this manner, the defendant received a total sum of Rs.45,000/- in cash until execution of the suit agreement, leaving a residue of Rs.5000/- to be paid at the time of execution and registration of the covenanted sale deed. The suit agreement stipulated a period of one year for the execution of the deed of sale. It is the plaintiff's further case that a few months after execution of the suit agreement, he secured necessary funds to pay the remainder consideration of Rs.5,000/- and to defray expenses of execution and registration of the conveyance. It is specifically averred in the plaint that the plaintiff had and still has ready money with him to pay the balance sale consideration and expenses for purchase of requisite stamp papers and defraying expenses of execution and registration of the sale deed. The plaintiff in the company of some respectable men approached the defendant, requesting him to execute the agreed sale deed, which he may do after accepting the balance sale consideration. The plaintiff conveyed to the defendant that he would bear all necessary expenses of execution and registration and to do all this, he is always ready. The defendant despite being persuaded by the plaintiff to fulfill his obligations under the suit agreement warded off the same.
8. Faced with inaction on the defendant's part, the plaintiff instructed his Counsel, Sri Ram Prakash Saxena, Advocate, Kanpur Dehat to serve a notice upon the defendant, calling upon him to execute a sale deed, in terms of the suit agreement. A notice dated 17/19.03.1990 was sent by the plaintiff's Counsel to the defendant by registered post, which the defendant received on 21.03.1990. The notice clearly informed the defendant that the latter may come over to the office of the Sub-Registrar, Pukhranya on 26.03.1990 at 10 O' clock, where after receipt of the balance sale consideration, he may execute the covenanted sale deed in the plaintiff's favour. It was also indicated in the notice that the plaintiff would defray all expenses of execution and registration, and that he would await the defendant at the appointed time and venue along with his witnesses. The defendant, however, did not turn up. The plaintiff remained present at the Sub-Registrar's office with the balance sale consideration and other expenses throughout (the day), awaiting the defendant's arrival. As the defendant did not turn up, the plaintiff made an application to the Sub-Registrar, reporting his presence.
9. The plaintiff has averred that post 26.06.1990 also, the plaintiff has with him the balance sale consideration and is ready to get the agreed sale deed executed. The plaintiff has requested the defendant by word of mouth regularly to fulfill his obligations under the suit agreement. It is averred that on 28.05.1990, the defendant, in the presence of a number of other men, refused to execute the promised sale deed. It is on these allegations that the suit was instituted.
10. The defendant appeared and filed his written statement dated 09.08.1991 and contested the suit. He traversed the plaintiff's case. The defendant has asserted that he never wished to sell the suit property and has no need or motive to do so. He has denied the fact that he ever entered into negotiations with the plaintiff about a deal to sell the suit property. It is also denied that he ever executed the suit agreement. It is also denied that the defendant ever received a sum of Rs.30,000/- prior to execution of the suit agreement. The receipt of Rs.15,000/- before the Sub-Registrar also, by way of earnest has been denied by the defendant. It is a wholesome denial by the defendant about his subscription to the suit agreement. The other assertions about the demanded performance have been denied. It has been asserted that the notice dated 17/19.03.1990 served by the plaintiff through learned Counsel was answered through his Counsel vide a reply dated 26.03.1990. To substantiate his stand about disowning the suit agreement, the defendant has pleaded that he borrowed from the plaintiff a sum of Rs.15,000/-. In order to secure the loan, the plaintiff asked the defendant to come over to Pukhranya, where the necessary paper work was understood to be done. There, the plaintiff took the defendant to Sri Ram Prakash Saxena, Advocate, who drew up a document that the defendant signed, understanding it to be one to secure the plaintiff's money loaned.
11. It is the defendant's further case that the said document was neither read over to him by the learned Counsel, or by anyone in the Sub-Registrar's office. It is also pleaded by the defendant that if the plaintiff had in fact paid him a sum of Rs.30,000/- prior to execution of the suit agreement, he would have required him to execute a sale deed on 24.06.1989, which he did not do. It is also the defendant's case that on asking the contents of the suit agreement to be read over to him, he came to know that witnesses of this execution were one Ram Shanker, an uncle of the plaintiff (father's brother) and Sri Ram Prakash Saxena, the plaintiff's Advocate. The endorsement of the Sub-Registrar on the suit agreement has been dubbed as falsehood. It is pleaded that the Sub-Registrar never asked the defendant anything when the suit agreement was presented for registration. Also, the defendant claims that the Sub-Registrar never apprised him about the contents of the document, or that it was an agreement to sell.
12. It is specifically pleaded that the suit agreement has been secured by the plaintiff in conspiracy with the witnesses playing fraud upon the defendant, misrepresenting the character of the document. The suit agreement was got signed by the defendant, representing to him that it was a document to secure the loan in the sum of Rs.15,000/- paid to him. It is also pleaded that the defendant is an illiterate village dweller, who thumb marked the suit agreement, understanding it to be security papers for the loan. He never understood it to be an agreement to sell.
13. The Trial Court, on the pleadings of parties, framed the following issues (translated into English from Hindi vernacular):
"(1) Whether the disputed agreement to sell dated 24.06.89 has been secured by defrauding the defendant?
(2) Whether the disputed agreement to sell is void and cannot be specifically enforced as pleaded in paragraph 12 of the written statement?
(3) Whether the defendant negotiated sale of his land with the plaintiff and settled the transaction for a sum of Rs.50,000/-?
(4) Whether the defendant executed any agreement to sell in favour of the plaintiff on 24.06.1980?
(5) Whether the plaintiff paid the defendant by way of earnest a sum of Rs.30,000/- in the parties' village?
(6) Whether the plaintiff ever approached the defendant with money in order to secure execution of a sale deed?
(7) Whether the defendant received from the plaintiff a sum of Rs.15,000/- by way of earnest in the presence of Sub-Registrar?
(8) Whether the plaintiff is entitled to any relief?"
14. The parties led evidence before the Trial Court.
15. On behalf of the plaintiff, three witnesses were examined, to wit, the plaintiff himself as PW-1, Ram Shanker, PW-2 and Ram Prakash Saxena, PW-3. Documentary evidence was also led on behalf of the plaintiff comprising the suit agreement (Ex. 6Kha), a photostat copy of the suit agreement (paper no. 7Ga), a copy of the notice (paper no. 8Ga), registered postal receipt (paper no.9Ga), postal acknowledgment (paper no. 10Ga), application dated 26.03.1990 (paper no. 11Ga), a copy of the khatauni (paper no.12Ga) and a copy of the application dated 26.09.1990 (paper no. 32Kha).
16. On behalf of the defendant, two witnesses were examined: Sahendra Singh, DW-1 and Moti Lal, DW-2. The defendant in his documentary evidence filed a copy of the reply notice, numbered as paper no.32Ga.
17. The Trial Court decided issues nos.1, 2 and 4 together. It was held that the suit agreement was got executed by the plaintiff defrauding the defendant. The defendant executed the suit agreement, understanding it to be a document to secure the loan of Rs.15,000/-, advanced to him by the plaintiff. It was further held that the suit agreement was void and could not be specifically enforced. Thus, issues nos.1 and 2 were answered in the affirmative, whereas issue no.4 was answered in the negative. Issues nos.3 and 5 were answered in the manner that in view of the findings on issues nos.1, 2 and 4, the plaintiff did not negotiate any deal about a sale with the defendant or settled for a sum of Rs.50,000/-. The defendant entered into the suit agreement, understanding it to be security papers relating to the loan of Rs.15,000/-. Also, the defendant never received a sum of Rs.30,000/- from the plaintiff, back at the parties' village. Thus, issue no.3 and 5 were both answered in the negative and against the plaintiff. Issues nos.6 and 7 were also decided against the plaintiff and in favour of the defendant. With conclusions reached on the basis of the Court's findings on issues nos.1 to 7, the Trial Court answered issue no.8 in the manner that the suit agreement was got executed by playing fraud on the defendant and that, therefore, the plaintiff was not entitled to any relief. The suit was ordered to be dismissed with costs.
18. The plaintiff appealed the Trial Court's decree to the learned District Judge, Kanpur Dehat vide Civil Appeal no.10 of 1992. The appeal aforesaid was instituted on 03.03.1992. The appeal came up for determination before the Ist Additional District Judge on 31.08.1992. The Lower Appellate Court, by the impugned judgment and decree dated 31.08.1992, allowed the appeal, set aside the judgment and decree of the Trial Court and decreed with costs the suit for specific performance. The defendant was ordered to execute a sale deed within two months, after receiving the balance sale consideration. The decree also carries a direction that in the event of default by the defendant, the plaintiff would be entitled to secure execution of the sale deed through process of Court, upon deposit of the balance sale consideration and necessary expenses for execution and registration of the sale deed in the Execution Department.
19. Aggrieved, the defendant has brought this appeal from the appellate decree.
20. This appeal was admitted to hearing, vide order dated 16.02.1993, on questions nos.1, 2, 3, 4, 5 and 6, formulated in the memorandum of appeal. These substantial questions of law read thus:
(1) Whether the suit can be decreed if the plaintiff is (sic has) failed to prove his own case?
(2) Whether the lower appellate court can allow the appeal and decreed (sic decree) the suit without reversing or setting aside the findings recorded by the trial court.
(3) Whether the suit can be decreed by lower appellate court on the basis of findings which are based on surmises and conjectures?
(4) Whether the suit can be decree (sic decreed) by wrong shifting of burden of prove (sic proof) to (sic the) appellant?
(5) Whether it was obligatory for (sic the) court to record the finding regarding intention for executing the sale deed?
(6) Whether the court can decree the suit for specific performance even if the evidence proved that the intention of the executor of the document was for executing the sale deed but for security of the loan?"
21. This Court, by recording reasons carried in the order dated 05.02.2020, framed an additional substantial question of law numbered 7, that reads:
"7. Whether the relief of specific performance is to be granted, in case of an immovable matter (sic property) as a matter of course, without any consideration by the Court of evidence, facts and circumstances that may sway its discretion under Section 20 of the Specific Relief Act?"
22. Heard Mr. Vivek Singh along with Mr. Ajay Singh Sengar, learned Counsel for the defendant and Mr. Yashwant Singh, learned Counsel appearing on behalf of the plaintiff.
23. Learned Counsel for parties have addressed this Court in the present appeal on substantial questions of law nos.4, 6 and 7, and not the others. This Court, too, after hearing learned Counsel for parties, finds that substantial questions of law nos.1, 2, 3 and 5 do not arise for consideration in this appeal.
24. The first substantial question of law to be considered is whether the suit can be decreed by a wrong shifting of the burden of proof upon the defendant. Learned Counsel for the defendant, in advancing his submissions, says that there is no quarrel about the fact that the defendant is an illiterate and rustic villager, who cannot read or write. He cannot even sign his name. It is pointed out that the defendant has specifically pleaded a case in paragraph 14 of the written statement that the plaintiff, in conspiracy with the witnesses of the suit agreement, falsely represented to him the character of the document as one to secure the loan of Rs.15,000/- advanced, instead of its true character and made the defendant thumb mark it, taking advantage of his illiteracy. Learned Counsel for the defendant submits that it is a case where the defendant does not dispute his thumb mark on the suit agreement, but denies its contents. He does so by saying that his mind did not accompany his mark. According to the learned Counsel for the defendant, this mistake, on the defendant's part, was brought about as a result of a fraudulent representation by the plaintiff and the witnesses of the suit agreement, about character of the document.
25. Learned Counsel for the defendant takes his submission forward by saying that normally in the case of a plea about the mind not accompanying the signature, or so to speak, where the contents are denied but the signatures admitted, the burden is upon the person who sets up that plea. But, the learned Counsel for the defendant is quick to add that in the case of an illiterate and rustic villager, who does not know how to read or write, the burden of proof would lie on the party, who propounds the document. In his submission, the burden of proof would, therefore, rest on the plaintiff to show that the suit agreement was subscribed to by the defendant after understanding the nature of the transaction. Learned Counsel for the defendant urges that no evidence has been led on behalf of the plaintiff to demonstrate that the defendant was made aware of the nature of the transaction, before he put his mark.
26. To the contrary, Mr. Vivek Singh, learned Counsel for the defendant submits that the fact that both witnesses of the suit agreement are partisan, excludes the possibility about the nature of the transaction embodied in the document, being known to the defendant. Learned Counsel points out that one of the two witnesses, Ram Shanker is an uncle of the plaintiffs (father's brother) and the other Sri Ram Prakash Saxena, is the plaintiff's Advocate. One of them is partisan by friendship and the other by his professional loyalty. Learned Counsel for the defendant has drawn attention of the Court to the testimony of the defendant in the dock, where in his examination-in-chief on 17.11.1991, he has stated: "जब श्री राम प्रकाश सक्सेना ने मेरा निशान अंगुठा यह कहकर लगवाया कि सादे कर्जे की लिखा-पढ़ी है। रजिस्ट्री दफ्तर में पढ़कर नहीं सुनाया गया।"
27. It is pointed out that in his cross-examination too, the defendant has stood by his case that he was kept in oblivion about the character and the contents of the suit agreement. Learned Counsel for the defendant submits that on the facts and evidence, particularly, the fact that the defendant is an illiterate and rustic villager, burden of proof lay on the plaintiff to prove that the defendant entered into the transaction, embodied in the suit agreement, after fully understanding its nature and terms. This burden, according to the learned Counsel, has been placed in error on the defendant's shoulders in accordance with the normal rule applicable to a plea of ''the signatures being admitted but the contents denied'. Learned Counsel submits that the Lower Appellate Court has committed a manifest error of law in completely overlooking the defendant's disability, on account of his abject illiteracy, that would lead to a reversal of the burden of proof. In support of his submission, learned Counsel for the defendant has placed reliance upon a decision of this Court in Laxmi Narain and another vs. Smt. Hubraja alias Barki, 1989 (15) All L.R. 800. Learned Counsel for the defendant has called attention of the Court to what has been held by S.H.A. Raja, J. in Laxmi Narain (supra):
"In Paras Nath Rai v. Tilesar Kunwar, [1965 Alld. L.J. 1080.] this court has indicated the law regarding the transaction executed by a Pardanashin lady or an illiterate ignorant woman, though she may not be pardanashin, in the following words:
"Rules regarding transaction by a Pardanashin lady are equally applicable to an illiterate and ignorant woman, though she may not be a Pardanashin. It is not by reason of the Pardah itself that the law throws its protection around a Pardanashin lady but by reason of those disabilities which a life of seclusion lived by a Pardanashin lady gives rise to and which are consequently presumed to exist in the case of such a lady. But the disabilities which make the protection necessary may arise from other causes as well. Old age, infirmity, ignorance, illiteracy, mental deficiency in-experience and dependence upon others, may by themselves create disabilities that may render the protection equally necessary. If therefore, it is proved that a woman, although she is not a paradanashin lady, suffers from the disabilities to which a pardanashin lady is presumed to be subject, the validity and the binding nature of a deed executed by her have to be judged in the light of those very principles which are applied to a deed by a pardanashin lady where the plaintiff was illiterate and when she executed the deed in question she was not only more than sixty years old, but was also hard of hearing and she was described by the defendant themselves as a foolish and rustic woman completely devoid of intelligence and according to the finding of the lower appellate court she was correctly described as such and besides the defendants stood in relation to her in a position of active confidence, held--that there could be no doubt that she was as much entitled to protection of the law as a pardanashin lady......"
"It is not necessary to ascertain whether fraud, misrepresentation or undue influence has been established when it has been found that the deed executed by a pardanashin lady has not been executed by her voluntarily and after appreciating the nature and import of the transaction, and the latter finding alone is sufficient for holding that the deed is not binding on her and it conveyed no title."
If it is assumed that the alleged document was read out and explained to the respondent, even then it is not sufficient to discharge the burden which rests upon the appellant who claims right under a deed from aged, illiterate and mentally deficient lady. The appellants have failed to establish that the respondent knew what the consequences of her act were going to be and how they were to affect her. In this case it was necessary to establish that it was explained to the lady that by the execution of the sale-deed she would have to part with a part of her property. There is not an iota of evidence on the record to establish that any one explained these consequences to the respondent. There existed no evidence to establish that the respondent understood the result of what she was doing and any independent advice was available to her at the time of execution of sale deed. The first appellate Court was fully justified in allowing the appeal and decreeing the suit of respondent-plaintiff. No substantial question of law is involved in this appeal."
28. Mr. Yashwant Singh, learned Counsel for the plaintiff has refuted the submissions advanced on behalf of the defendant. He has urged that the principle about reversal of burden to sustain a transaction relating to disposition of property is confined in its application to pardanashin women and also to illiterate and ignorant women, not acquainted with the ways of the world. He points out that this principle is not attracted to the case of men, howsoever illiterate, who are by traditions of the society, always exposed to and engaged in worldly business. In short, learned Counsel for the plaintiff says that the principle has to be confined in its application to a particular class of women alone - pardanashin, or illiterate and ignorant. It is not at all applicable in case of men, howsoever rustic, ignorant and illiterate.
29. This Court has keenly considered the submissions advanced. At the hearing of this appeal, this Court asked Mr. Vivek Singh to show any authority, where this principle, relating to reversal of burden regarding validity of a transaction entered into by women of a certain class distinguished by their disabilities, has also been extended to men with similar disability. Mr. Vivek Singh very fairly accepted before this Court that he could not lay his hands on any authority, where the principle has been extended to men with disability similar to illiterate and ignorant women. Nevertheless, Mr. Vivek Singh said that the principle ought to be extended to illiterate, ignorant and rustic men, who are not in any way better placed than a woman similarly circumstanced. He urged that non-extension of the principle about reversal of burden, that is designed to protect pardanashin women as well as illiterate and ignorant women, to rustic and illiterate men would indeed be an application of the principle that discriminates on the ground of sex alone.
30. Learned Counsel for the defendant has argued that though the principle judicially evolved, like judicial orders, cannot be subjected to judicial review by invoking the writ jurisdiction, under Article 226 or Article 32, but the creed of Article 15 binds all Courts while laying down principles of law governing rights of parties. He submits that legal principles cannot be applied in a manner that they work hostile discrimination against a citizen on the ground of sex alone, though otherwise similarly circumstanced.
31. It would be profitable first to look at the principle about a person's solemn deed, regarding which he/ she says that he/ she signed, understanding it to be something else. This plea is often described as the mind not accompanying the signatures. It is also familiarly referred to in the world of law as non est factum. This plea, on the basis of which the maker of a solemn deed could avoid liability about the disposition made, had its origin in the English Law. The principle finds its classical statement in the oft-quoted decision of Byles, J. in Foster vs. Mackinnon, [1869(4) C.P. 704]. It is held there:
"it is invalid not on the ground of fraud where fraud exists but on the ground that the mind of the signor did not accompany the signature: in other words, that he never intended or contemplated to sign, and, therefore, in contemplation of law never did sign the contract to which his name is appended."
The principle had a long history of evolution in England and was always recognized as distinct and different from a plea to avoid a transaction on the ground of fraud, duress or undue influence. There was, however, no principle about reversal of burden of proof, that obliged the beneficiary of a transaction to prove its due understanding by the maker of a solemn deed, who alleged non est factum. The principle about reversal of burden in the case of pardanashin women, in the first instance and its later extension to other ignorant and illiterate women, as a distinct class, entitled to that protection in the matter of disposition of their rights in property, was evolved by the Privy Council, bearing in mind disabilities, associated with the members of the beneficiary class.
32. The origin of the principle about reversal of burden regarding transactions entered into with pardanashin women and the way it evolved about how that burden was to be discharged, was the subject matter of decision by the Supreme Court in Mst. Kharbuja Kuer vs. Jangbahadur Rai and others, AIR 1963 SC 1203. In the said decision, tracing the origin of the rule and laying down by what standard and in what manner that burden is to be discharged, K. Subba Rao, J. (as His Lordship then was) held:
"(5). ......... This proposition, in our view, is clearly wrong and is contrary to the principles laid down by the Privy Council in a series of decisions. In India pardahnashin ladies have been given a special protection in view of the social conditions of the times; they are presumed to have an imperfect knowledge of the world, as, by the pardah system they are practically excluded from social intercourse and communion with the outside world. In Farid-Un-Nisa v. Mukhtar Ahmad, 52 Ind App 342 at p. 350: (AIR 1925 PC 204 at p. 209), Lord Sumner traces the origin of the custom and states the principle on which the presumption is based. The learned Lord observed:
"In this it has only given the special development, which Indian social usages make necessary, to the general rules of English law, which protect persons, whose disabilities make them dependent upon or subject them to the influence of others, even though nothing in the nature of deception or coercion may have occurred. This is part of the law relating to personal capacity to make binding transfers or settlements of property of any kind."
The learned Lord also points out:
"Of course fraud, duress and actual undue influence are separate matters."
It is, therefore, manifest that the rule evolved for the protection of pardahnashin ladies shall not be confused with other doctrines, such as, fraud, duress and actual undue influence, which apply to all persons whether they be pardahnashin ladies or not.
(6). The next question is what is the scope and extent of the protection. In Geresh Chunder Lahoree v. Mst. Bhuggobutty Debia, 13 Moo Ind App 419 (PC) the Privy Council held that as regards documents taken from pardahnashin women the court has to ascertain that the party executing them has been a free agent and duly informed of what she was about. The reason for the rule is that the ordinary presumption that a person understands the document to which he has affixed his name does not apply in the case of a pardahnashin woman. In Kali Baksh v. Ram Gopal, 43 Ind App 23 at p. 29 (PC), the Privy Council defined the scope of the burden of a person who seeks to sustain a document to which a pardahnashin lady was a party in the following words:
"In the first place, the lady was a pardahnashin lady, and the law throws round her a special cloak of protection. It demands that the burden of proof shall in such a case rest, not with those who attack, but with those who found upon the deed, and the proof must go so far as to show affirmatively and conclusively that the deed was not only executed by, but was explained to, and was really understood by the grantor. In such cases it must also, of course, be established that the deed was not signed under duress, but arose from the free and independent will of the grantor."
The view so broadly expressed, though affirmed in essence in subsequent decisions, was modified, to some extent, in regard to the nature of the mode of discharging the said burden. In 52 Ind App 342 at p. 352: (AIR 1925 PV 204 at p. 210) it was stated:
"The mere declaration by the settler, subsequently made, that she had not understood what she was doing, obviously is not in itself conclusive. It must be a question whether, having regard to the proved personality of the settler, the nature of the settlement, the circumstances under which it was executed, and the whole history of the parties, it is reasonably established that the deed executed was the free and intelligent act of the settler or not. If the answer is in the affirmative, those relying on the deed have discharged the onus which rests upon them."
While affirming the principle that the burden is upon the person who seeks to sustain a document executed by a pardahnashin lady that she executed it with a true understanding mind, it has been held that the proof of the fact that it has been explained to her is not the only mode of discharging the said burden, but the fact whether she voluntarily executed the document or not could be ascertained from other evidence and circumstances in the case. The same view was again reiterated by the Judicial Committee, through Sir George Rankin, in Hem Chandra v. Suradhani Debya, AIR 1940 PC 134. Further citation is unnecessary. The legal position has been very well settled. Shortly it may be stated thus: The burden of proof shall always rest upon the person who seeks to sustain a transaction entered into with a pardahnashin lady to establish that the said document was executed by her after clearly understanding the nature of the transaction. It should be established that it was not only her physical act but also her mental act. The burden can be discharged not only by proving that the document was explained to her and that she understood it, but also by other evidence, direct and circumstantial."
33. The application of the rule, regarding reversal of burden, governing transactions by pardanashin women was acknowledged to be extended to illiterate and ignorant women by this Court in Paras Nath Rai vs. Tilesar Kunwar, 1965 All. L.J. 1080, which has been followed by this Court in Laxmi Narain (supra). The extension of the rule to an illiterate widow was acknowledged by this Court in Manohar Lal vs. Rajeshwari Devi and others, AIR 1977 All 36.
34. The earliest origin for an extension of the rule about reversal of burden relating to pardanashin women to other classes of women, subject to the same disabilities, though not strictly pardanashin, had origin in the decision of the Privy Council in Hodges and another vs. Delhi and London Bank, Limited, (1899-1900) XXVII Indian Appeals 168. The suit that led to the appeal was about the validity of certain transactions between a traditional Indian women from Kashmir (who had married a British Army Officer) and a Bank, where she had dealt with her shares, assigning them to the Bank, in order to liquidate a loan, if required. The loan appears to have been taken by her son, a certain Colonel Oldham, from the Bank. The loan agreement on the debtor's part was signed by Colonel Oldham, Katherine Hodges and one Captain Craster. The Indian woman had lived as a British Army Officer's wife, and in course of time had become a widow. She had taken the name of Katherine Hodges. In the loan agreement, though she was a party, the loan was taken by her son, Colonel Oldham. Katherine Hodges and Captain Craster were understood to have stood sureties with joint and several liability. In order to secure the loan advanced to her son, Katherine Hodges had handed over to the Bank certain shares in other Banks, through a letter written by her to the Bank. There was also a power of attorney, authorizing the Bank to sell the shares, in order to liquidate the loan, in case conditions of repayment were violated. After her death, there was some default by Colonel Oldham. There are other issues about discharge of sureties, but all that is not relevant. The Bank brought a suit to recover against the parties to the loan agreement personally, and from the estate of Katherine Hodges. On behalf of the estate of Katherine Hodges, there was a very interesting defence that she "was a quasi purdanashin lady, of no education, unable to read or write English, and quite incapable of understanding the terms of the three instruments in question; which were not explained to her, and on which she had no independent advice." (quoted verbatim from the report of the judgment). The plea in substance asked for extension of the principle governing cases of dealings by a third party with pardanashin women, regarding disposition of their property or interest. In answering the question, Lord Hobhouse, speaking for the Board, held:
"In this part of the case there is no discrepancy in the evidence except on some small immaterial details, and none at all in the findings of the two Courts. It is abundantly clear that Mrs. Hodges was not a pardanashin. The term quasi-purdanashin seems to have been invented for this occasion. Their Lordships take it to mean a woman who, not being of the pardanashin class, is yet so close to them in kinship and habits and so secluded from ordinary social intercourse, that a like amount of incapacity for business must be ascribed to her, and the same amount of protection which the law gives to pardanashin must be extended to her. The contention is a novel one and their Lordships are not favourably impressed by it. As to a certain well known and easily ascertained class of women, well known rules of law are established, with the wisdom of which we are not now concerned. Outside that class it must depend in each case on the character and position of the individual woman whether those who deal with her are or are not bound to take special precautions that her action shall be intelligent and voluntary, and to prove that it was so in case of dispute. Mrs. Hodges was an independent woman of more than ordinary capacity for, and experience in, dealing with property. It would be very unjust to hold that the Bank was bound to treat her on any other footing."
(Emphasis by Court)
35. The principle then, on which the decision of the Privy Council turned, was not to extend the protection to illiterate women or those who could not read, write or understand English as a class, like pardanashin women by treating them to be what was dubbed as quasi pardanashin. Rather, it was held that extension of the protection, that is to say, reversal of burden, in cases of such women, who were claimed to be illiterate or otherwise not acquainted with the ways of the world or as it is described in later decisions as secluded from the society, would depend in each case on the character and position of the person concerned.
36. In Sm. Sonia Parshini vs. Sheikh Moula Baksha, AIR 1955 Cal 17, Debabrata Mukharjee, J, speaking for the Division Bench of the Calcutta High Court, posed the following question, opening the judgment:
"The question raised in this appeal is whether a deed of sale executed by an illiterate woman without the benefit of independent advice is subject to the same jealous scrutiny of the Court as an instrument executed in similar circumstances by a pardanashin lady strictly so-called."
His Lordship went on to hold thus:
"(6) The substantial question here is whether in the facts and circumstances proved the plaintiff appellant could be held to be entitled to this protection. This would require examination of the reasons behind the rule protecting transactions in which paradanashin women are concerned. The inhibitions imposed by social conditions upon women of a certain well-defined class bring in their train disabilities which have compelled reversal of the rule that ordinarily a person is to be held to his contract. These disabilities are due largely to illiteracy and ignorance which superadded to restrictions on free movement and contact with the world outside induce a condition of helplessness requiring the utmost vigilance to prevent unfairness in a deal in which she is concerned. The parties to the transaction not being evenly placed, courts called upon to pronounce on such transactions have always jealously guarded against possible unfairness. It has therefore come to be recognised as a rule of law that a party founding on a deed executed in such circumstances has to establish intelligent understanding of the deed and the burden is not discharged by mere proof of the execution of the document. Questions of fraud or undue influence apart, the plain requirement of the law in such cases is clear proof of comprehension of the contents of the document executed by her.
Such protection cannot plainly be the exclusive privilege of the class commonly known as pardanashin. The parda with its inhibitions may be an additional feature or element in the case but the real reason behind the rule is lack of understanding and appreciation of what an illiterate woman without independent advice, is about. Where ignorance and illiteracy are proved exposing the woman concerned to the danger and the risk of an unfair deal it would, we think, be a perversion of the rule to deny in such case the protection, despite the helplessness of her state, merely on the ground that she is not strictly pardanashin. It is quite conceivable that a woman belonging to the pardanashin class properly so-called may in spite of the restraints of the parda have sufficient understanding and appreciation of the contents of a document to which she is a party. In such case there can be no question of the protective cloak being thrown around her and she cannot be heard to plead her pardah in avoidance of the transaction. The criterion cannot be the social status implied in the pardah class but the ability to comprehend the contents of the document in question and the means or opportunities of such comprehension. The emphasis must be on the factual understanding of the document with reference to the individual concerned and not upon presumptive disability incidental to mere status.
(Emphasis by Court)
37. To the understanding of this Court, this rule has been approved to apply to the identified class of women, called pardanashin on a presumptive basis. In dealing with pardanashin women, the rule appears to be that the beneficiary of transactions from such women, where they deny the transaction or plead non est factum, must discharge the burden to affirmatively prove that the executor of the document understood what the transaction was, as also its terms broadly. Even in case of pardanashin women, there are noticeable remarks in the authorities which indicate that in a given case, it could be shown that a particular pardanashin woman, though properly a member of that class, was wordly-wise, and, therefore, not entitled to a protection of the rule about reversal of burden. In course of time, the rule has been extended to other ignorant and illiterate women, who are similarly circumstanced and subject to the same disabilities as pardanashin women. The raison d'être to extend protection of the rule in question as remarked in Sm. Sonia Parshini, is not a membership of the class, known as pardanashin women, but the presumed inability of members of that class to comprehend the nature of the transaction, they have gone about due to myriad factors, that inhibit their understanding. For the same reason, the protection has been extended to women who are ignorant and illiterate and frequently described as unacquainted with the ways of the world.
38. This Court cannot ignore to refer to a decision of the Madras High Court in Chidambaram Pillai and 3 others vs. Muthammal and another, (1993) 1 M.L.J. 535, which undertakes a most comprehensive review about the law on the subject of reversal of burden in case of pardanashin women and other illiterate women. The decision in Chidambaram Pillai (supra) expounds the principle that the protection is available to illiterate women in the same manner as pardanashin women. Their Lordships of the Division Bench in Chidambaram Pillai (supra) have expounded and summarized the principles about extension of the rule regarding reversal of burden to illiterate women, thus:
"16. The pardah system as understood by the courts in India is not the system of keeping a woman under a veil indoors in zenana, but in seclusion, away from the knowledge of the world, in the sense that they are not ordinarily allowed to interact with the male folk and are kept away from social intercourse and communion with the outside world. The view of the Lahore Court in the case of Favvar-ud-din v. Kutab-ud-Din1 had almost worked as an alarm for the courts to develop a sense that any strict meaning to parda was going to exclude a greatly deprived section of the society from the protection cloak of the law, namely, the illiterate women and other women having such infirmities that they practically live without any social intercourse and communion with the outside world. The judicial consensus, as we have already noticed, has been expressed thus:--
"The rules regarding transaction by the Pardanashin apply equally to illiterate women though they may not be in a strict sense Pardanashin."
A Pardanashin may not be illiterate, but she still may be ignorant in the sense that she has an imperfect knowledge of the world, and she is practically excluded from social intercourse and communion with the outside world. Her ignorance is the curse of a social usage that womenfolk depend upon malefolk for transaction of their business with the outside world. Thus, not all women, but only those who are practically excluded from social intercourse and communion with the outside world fall in this category. If it is for this reason that they are taken as persons suffering from disabilities which make them dependent upon or subject to the influence of others, the illiterate women who, for the reason of social compulsion are required to move out to work in the fields and elsewhere for livelihood, cannot be said to be less disabled and deprived. Even if they are intelligent to know where to go and how to earn their livelihood, yet they cannot read anything nor write anything, and unless told about the contents by others, will not know what the document contains. To the extent the character, content and the effect of the document are concerned, she has to be presumed to be ignorant by sheer illiteracy, the curse which is still pervading the ancient society particularly the women living in this part of the country, a fact about which, we think, we are competent to take judicial notice. We find ourselves in complete agreement with the view that the special cloak of protection applied to Pardanashin women has to be applied to illiterate women as well."
(emphasis by Court)
39. The decision in Chidambaram Pillai (supra) is remarkable in the sense that it sheds light on the very pertinent, but at the same time very ignored question that Mr. Vivek Singh has mooted. It is about the application of the rule as to reversal of burden in case of a transaction done by a man, who is illiterate; one who cannot read, write or even sign his name. To add, he may be a rustic, engaged in a rural occupation, like that of an agricultural labourer. Is he not entitled to say that he never understood the nature of the transaction, to which he has affixed his mark? Is he not entitled to say that denied development of the human faculty by illiteracy absolute, and living the life of a rustic in a remote village, engaged in some traditional and simple occupation, like that of an agricultural labourer or a village artisan, he is entitled to the benefit of the rule regarding reversal of burden? The decision in Chidambaram Pillai (supra) carries some very pertinent remarks, bearing reference to rare authority. Mishra J., speaking for the Division Bench in Chidambaram Pillai (supra) observed:
"17. When we have said as above, we should not be understood to say that in a given case, a male cannot be protected by such a rule. In Omanhene Kwamin Bassayin v. Omanhene Bendentu2 the Privy Council applied such a rule of burden of proof upon the defendant in the case of a person who was illiterate and who pleaded that the contents of the document were not read over and explained to him. A learned Judge of this Court in Ramaswami Jadaya Gounder v. V.T. Ilaya Pillai3 has dealt with a case of a person who knew to sign his name, but said, he had no knowledge of the contents of the document to which his signatures were taken, and he was not informed of the contents of the documents as the documents were not read over or explained to him. The learned Judge has said:--
"In this case, the plea of the plaintiff is that he is illiterate and that apart from putting his signature he does not know how to read or write. In the circumstances the burden is on the plaintiff to prove that the defendant had executed the document."
It is possible to say that the special protection as the courts have described this rule, is a modification of rule of non est factum properly woven and wherever needed chistled to suit the Indian conditions. Since in the instant case, we are concerned with a woman who is an illiterate, we are in no need to say anything further.
........."
40. The last quoted remarks in Chidambaram Pillai are of great significance. The opening words there, put differently, are that a male can be protected by the rule regarding reversal of burden in a given case. It is also remarked that this rule regarding reversal of burden is a modification of the rule of non est factum, to borrow the words of their Lordships in Chidambaram Pillai, "properly woven and wherever needed chistled to suit the Indian conditions". It is also remarked that this modification of the rule has been described by Courts as a special protection. Now, these remarks in Chidambaram Pillai are in the context of a male, who is as disadvantaged, as disabled, as handicapped in understanding the consequences or the nature of the solemn transaction as a pardanashin women, or an illiterate and ignorant women. But, the most important words here are that the protection of this rule can be extended to a male ''in a given case'.
41. This Court is of opinion that the remarks in Chidambaram Pillai in the context of illiterate men or those under disability of the kind described above to a protection of the rule regarding reversal of burden, do not represent the ratio there; these are most certainly obiter. This is so because Chidambaram Pillai was not at all a case about an illiterate, ignorant or rustic man, asking for a protection of the Rule. The remarks though obiter are still sterling. It must also be pointed out that to justify the remarks under reference, the Court in Chidambaram Pillai has referred to two authorities, where the rule regarding reversal of burden was applied to men, who could not at all understand the nature of the document, to which they appended their mark. These cases would be referred to a little later in this judgment.
42. To the understanding of this Court, the significance of the words in Chidambaram Pillai that the rule regarding reversal of burden could even apply to a male ''in a given case', signify that an illiterate, ignorant and rustic man, like an illiterate and ignorant woman, cannot claim benefit of application of the rule on a presumption. There is no rule that illiterate, ignorant and rustic men, like illiterate and ignorant women, would always be entitled to the protection of the rule about reversal of burden, when the issue is about their liability on a solemn document, executed by them regarding disposition of property etc. In case of men, it has to be established by one who seeks benefit of the rule by evidence alluendi that he is on account of illiteracy, ignorance and his utter unfamiliarity with the ways of world put against the nature of the transaction, entitled to a protection of the rule.
43. To better understand the reasoning behind this conclusion, one has to bear in mind why this rule was invented to protect Indian women of a particular class about their transactions. The original rule, that was designed to protect pardanashin women alone, going by their particular life style and the social conditions, prevalent in India at the time, was based on practical sagacity. The idea was that women who were living a life of such isolation that made them utterly ignorant about wordly matters, ought to be protected. The rule was extended further to protect a larger class of Indian women, who though not pardanashin, were so illiterate and ignorant, that placed them in a position of identical disadvantage as pardanashin women, properly so called. The disability was not inferred from illiteracy alone or membership of the class called pardanashin merely because the person belonged to a particular class or was disabled in a particular matter. The disability entitling those class of women to a protection of the rule on a presumption, arose from the prevalent conditions in India, where women were kept out of most affairs of the world, if they happened to fall in the class of women described. It was never thought to be a principle that a pardanashin woman or an illiterate and ignorant woman, who otherwise had business capability, would still be protected by the rule. The rule is, thus, no more than a recognition about a certain class of Indian women in society, who were under disability in the matter of understanding affairs of the world.
44. Men to the contrary, have never been under such a disability in this country, or for that matter elsewhere. It must be remarked here, to answer a submission of Mr. Vivek Singh, that the constitutional guarantee against discrimination on ground of sex carries with in it, an acknowledgment of the fact that women on account of historical and social conditions are a special class, in whose favour the State may take affirmative action by way of reservation etc. without inviting the vice of hostile discrimination. This is what Article 15 of the Constitution postulates. Therefore, the principle judicially evolved regarding reversal of burden on a presumption regarding a particular class of women in India, entitling them to a protection of the rule, is no more than a recognition of the hard historical and social realities in the country. At the same time as already said, a man can ask for protection of the rule regarding reversal of burden, if he can show by the standard indicated hereinabove, that he is entitled to similar protection, as women of the specific classes are. A man, however, is not entitled to the protection merely because he is ignorant and illiterate. Men in this country, howsoever illiterate, have been at the helm of affairs of the society and guided it. Men, in fact, by the status flowing from their sex, have historically and traditionally formed the mainstream of society and have managed its affairs. The law, therefore, ascribes to them an understanding of their actions generally, irrespective of the fact whether they are illiterate, ignorant or rustic. After all men have managed for centuries whatever the contemporary society has been mostly about. It is, thus, a hard social reality, historically testified to, that would work to exclude a presumptive application of the rule regarding reversal of burden to illiterate, ignorant and rustic men, the way it has been extended to illiterate and ignorant women.
45. This Court must notice the decision of the Privy Counsel in Omanhene Kwamin Bassayin vs. Omanhene Bendentu II, AIR 1937 PC 274. The decision appears to have arisen on appeal from West Africa about a territory dispute between two chiefdoms of Aowin and Upper Wassaw. There was a dispute about the border of the two chiefdoms. It appears that demarcation between the two chiefdoms had been done through arbitration, in consequence of an agreement to refer, between the two chiefdoms. Aowin assailed the demarcation on ground that the contract to refer to arbitration had not been properly explained and interpreted to the Omanhene of Aowin, when he affixed his mark to it. The plea was that the Omanhene of Aowin could not understand the true import of the contract as he did not know the English language. Aowin had claimed in the action instituted that the boundaries between the two territories was a River Tanu, that ought to be declared. Damages on account of trespass were also claimed. The claim was decreed by the Courts in West Africa, and that is how the verdict was appealed to their Lordships of the Privy Council.
46. The relevant question about the law that fell for consideration was whether the Omanhene of Aowin would be bound by the contract that he marked, in the absence of the document being explained and interpreted to him. This was because the Omanhene did not know the English language. It was held that the onus lay upon Upper Wassaw to establish "that the document had in fact been properly explained and interpreted so as to make the Omanhene of Aowin understand its real import". The rule about reversal of burden in this case was, therefore, applied to a man, who was a high ranking traditional Chief in West Africa, because he did not understand the English language, in which the document was written and by which he was claimed to be bound. It may be mentioned here that an Omanhene, according to the New Shorter Oxford English Dictionary (volume 2) Third Edition, 1993 reprint/published by the Oxford University Press Inc., New York, means, "Among the Ashanti people: a paramount chief of a state or district"
47. Now in this case, one may infer the disabilities about understanding of a legal document written in English by a traditional Chief in West Africa, in the early part of the 20th Century. The decision to apply the rule regarding reversal of burden was apparently taken because the traditional West African Chief did not know the English language. It was apparently in the circumstances of the country, the social conditions, lack of understanding the English language, the nature of the document and its consequences on the entire chiefdom that this rule was apparently applied. This Court may hasten to add that on the express words of the decision, the rule was applied because the traditional chief did not understand the English language. However, the other factors, that would have entered judgment, cannot be missed. From the decision in Omanhene Kwamin Bassayin, no principle can be inferred that in case of all illiterate, ignorant and rustic men, burden of proof must be reversed about their title deeds, when denied by the executant about an understanding of its contents.
48. In Ramaswami Jadaya Gounder (died) and another vs. V. T. Elaiya Pillai and another, AIR 1972 Mad 336, the rule was indeed applied to a case, where a compromise decree entered in a suit on the basis of an agreement was assailed by one of the parties saying that he only knew how to sign his name and, therefore, had no understanding of the contents of the document, to which his signatures were put. It was claimed that he was not informed of the contents of the document, the document being not read over or explained to him. It was held by the lower Court, where these proceedings were brought, that since the party alleging did not say that he had signed blank sheets, but a completed document, the burden was on him to prove this case. There could be no reversal of burden. Following the decision in Omanhene Kwamin Bassayin, it was held by the Madras High Court in Ramaswami Jadaya Gounder (supra):
"3. In this case, the plea of the plaintiff is that he is illiterate and that apart from putting his signature he does not know how to read or write. In the circumstances, the burden is on the plaintiff to prove that the defendant had executed the document. The learned counsel for the respondents submitted that in the memorandum of grounds to the revision petition, the plea taken was that the petitioner executed the blank sheet of paper end this is contrary to the plea taken in the trial. The learned counsel is right, but the lower Court was passing the order on the pleadings before it where the defendant submitted that he was illiterate and that the contents of the document were not read over or explained to him. In the circumstances, the decision in AIR 1937 PC 274 is applicable and it has to be held that the burden is on the defendant to prove that the plaintiff had executed the compromise agreement. The petition is allowed and the defendant will be directed to begin and prove his case of execution of the document by the plaintiff."
49. This Court with the greatest respect is of opinion that the principle in Ramaswami Jadaya Gounder (supra) is too widely worded. It virtually extends the benefit of the rule about reversal of burden to every illiterate man, just by the factum of his illiteracy. It virtually places at par an illiterate man with an illiterate and ignorant women without anything more to be proved, about the maker's disability in the understanding of its contents or the ways of the world. The proposition in Omanhene Kwamin Bassayin in the considered opinion of this Court does not warrant a mathematical application or extension of the rule about reversal of burden to all illiterate men in India. This Court, therefore, with utmost respect is not in agreement with the principle in Ramaswami Jadaya Gounder (supra). This is, however, not to say that in a given case, where an ignorant and illiterate man demonstrates by the totality of the circumstances and the transaction that he has entered into, his utter disability to understand the nature of the transaction and the contents of the document, the Court would not be entitled to invoke the rule and reverse the burden. It cannot be, however, applied on a presumption in the same manner as it is done in the case of pardanashin women and certain other illiterate and ignorant women.
50. In the present case, the defendant has not led any evidence to show that he is a man, utterly unconnected with wordily affairs. He has not said in his evidence anything that may project him to be a simpleton, leading a secluded life away from wordly intercourse. Rather, he has indicated his inclination to do business, which he also says that he undertook. He claims that he took a loan in the sum of Rs.15,000/- from the plaintiff to invest in business. If those are his circumstances and engagements in life, it cannot be inferred, on the basis of his illiteracy alone, that he is entitled to a protection of the rule about reversal of burden in the manner that it is applied to pardanashin women and certain other traditional women, who are illiterate and ignorant. The Lower Appellate Court has refused to apply the rule of reversal of burden, and, in the opinion of this Court, rightly so. Accordingly, substantial question of law no.4 is decided in the negative, and it is held, that burden of proof has not been wrongly shifted upon the defendant for the reasons indicated.
51. The next substantial question of law that the defendant has pressed is the one framed as substantial question of law no.6. A reading of the question shows that there appears to be a clerical error in not mentioning the word ''not', between the words ''was' and ''for', occurring in the last but one line of the question. Learned Counsel for both parties do not dispute that, that is the purport of this substantial question of law. This Court, therefore, proceeds on the assumption that the substantial question of law under reference is to the effect whether the Court could decree specific performance, where the evidence proved that the intention of the executor was not to execute a sale deed, but to furnish security for the loan.
52. On the pleadings and case of parties before the Courts below, this question does not really seem to arise in the present case. The case of the defendant throughout has been that he executed the suit agreement, mistaking the character of the document as an instrument, creating a security for the loan. He never understood it to be an agreement to sell. Once that is the case of the defendant and that is how the two Courts below have dealt with the matter, there is little scope for the defendant to say that the document though executed as an agreement to sell, was in fact intended to serve as a security for the loan advanced. This kind of a plea or case arises where the defendant acknowledges the character of the document as an agreement to sell, attaching to the property, subject matter thereof, but says that the parties never intended or contemplated a sale; rather, the parties intended the agreement to serve as a security for the loan advanced. This kind of a plea by the defendant, is not at all there.
53. The issues framed by the Trial Court also do not indicate that the parties ever suited that case before the Courts below. Before the Lower Appellate Court also, a case of this kind was not even remotely urged. It is before this Court, for the first time, that a ground has been taken to the effect that the Courts below have not recorded any finding as to whether the intention of the defendant while executing the suit agreement was to execute a sale deed, and not a security for the loan. It has been urged through that ground that in the absence of a finding on the said issue, specific performance cannot be granted. The present substantial question of law is referable to the aforesaid ground in the memo of appeal.
54. Learned Counsel for the defendant has urged that this substantial question does arise in this case, inasmuch as the Supreme Court in Tejram vs. Patirambhau, (1997) 9 SCC 634 has held that where out of the total agreed sale consideration of Rs.50,000/-, a sum of Rs.48,000/- was paid by the vendee and the balance of Rs.2000/- was required to be paid within one year, the suit being instituted a month prior to the expiry of three years from the date of agreement, it could be inferred that the transaction was not about a contemplated sale. It was about creating a security in the form of an agreement to secure repayment of the loan. Apart from the fact that there were other circumstances in Tejram (supra), that led their Lordships to the conclusion that the transaction was not an agreement to sell, but merely a security for the loan, like the vendee there being a professional money lender, the principles there would otherwise also not apply to this case.
55. Here, the suit agreement made provision for the sale deed to be executed within a year of the said agreement dated 24.06.1989, but the plaintiff acted within a few months as soon as he had garnered the remainder of funds. A notice to execute the sale deed was got issued to the defendant on 17/19.03.1990 and served on 21.03.1990. The suit was instituted on 31.05.1990. The fact that of the entire agreed sale consideration of Rs.50,000/-, a sum of Rs.45,000/- was paid in advance, leaving a remainder of Rs.5000/-, does not show that the transaction was not bona fide or one to serve as security for a loan. Rather, the promptness with which the plaintiff acted in the matter, shows that once he had expended all his resources in paying the substantial part of the sale consideration, that is to say, a sum of Rs.45,000/- out of agreed sale consideration of Rs.50,000/-, he needed breathing time to arrange the remainder of funds of Rs.5000/- and more to defray expenses of execution and registration. He could do so within a period of few months, and, thereafter, acted with all promptitude. Moreover, a reading of the terms of the suit agreement, besides considering the testimony of parties in the witness box, a case about the suit agreement, serving as a security for repayment of the loan, is not even remotely made out. The terms of agreement are very material on the point of determining the true nature of the transaction as held by the Supreme Court in Madhukar Nivrutti Jagtap and Others vs. Smt. Pramilabai Chandulal Parandekar and Others, 2019 SCC OnLine SC 1026. In Madhukar Nivrutti Jagtap (supra), it has been held:
"34. There had not been even a remote suggestion in the documents in question that there was any loan or borrowing transaction between the parties and the said documents were being executing towards security. On the contrary, the recitals and stipulations in the said agreements had only been in affirmation of the agreement for sale and of the receipt of part payment from time to time against the sale consideration. Of course, defendant No. 1, while deposing as DW1 attempted to suggest that he had approached the plaintiff No. 3 seeking loan to the tune of Rs. 5000-5500/- through a broker; and, at the instance of the plaintiff No. 3, executed the document in question as security while taking loan at the interest rate of 1 per cent per month. This defendant also admitted having obtained another sum of Rs. 2,000/- from the plaintiff No. 1 and having put an endorsement on the document in question. He, however, denied having received any other amount or having delivered possession of the suit property. The evidence on the part of the defendants in this case remains rather vague and sketchy; and it is difficult to accept the oral assertions of defendant No. 1 as against the recitals in the agreements."
56. In the present case, there is not even a hint in the testimony of the parties in the witness box that any of them came up with a case that the suit agreement though executed as such, was in fact meant to serve as a security for repayment of the loan. The case of the defendant is about the character of the suit agreement being not at all understood by the defendant when he appended his mark to it. This case cannot coexist with the suit agreement, serving as a security. This is so, because the two are not merely alternate pleas, that can be urged together, but ones that cannot coexist. Here as already said, the case about the suit agreement being there, but intended to serve as a security for a loan, has not been pleaded by the defendant and, therefore, not determined by the Courts below. The present substantial question of law, therefore, does not at all arise. Now, this Court may proceed to consider substantial question of law no.7 involved in this appeal.
57. Learned Counsel for the defendant has submitted that the discretion to grant specific performance is not to be exercised even in cases where the contract is not voidable, because it is not vitiated by fraud, coercion or undue influence. It is to be refused in such cases, if granting specific performance is not consistent with equity and good conscience. It is also urged that the conduct of the plaintiff is an important matter, particularly, where he is dealing with a person who is disadvantaged, as in this case he says, due to illiteracy. In this connection, learned Counsel for the defendant has placed reliance upon a decision of this Court in Ram Das vs. Jagat Singh (Deceased) Thr. LRs, (2015) 4 All LJ 46. He has called attention of the Court to paragraphs 33, 34, 35, 36 and 43 of the report, where it is held:
"33. It is also well settled that a discretion exercised by the Trial Court will not be interfered in appeal unless it has been exercised perversely, arbitrarily, capriciously, unreasonably or against judicial principles.
34. As stated above, the circumstances as mentioned in the section itself are not exhaustive. It is not possible to lay down the circumstances and the Court can exercise its discretion against the plaintiff. However, they must be such that the representation by or the conduct or neglect of the plaintiff is directly responsible for including the defendant to change his position to his prejudice or such as to bring about situation when it would be inequitable to give such a relief.
35. It is also settled that under the specific performance of a contract, it is not vitiated by fraud or misrepresentation, can not be granted if it could give an unfair advantage to the plaintiffs, and where the purpose of the contract would involve some hardship to the defendant, which he did not foresee.
36. It is also a Court's discretion to grant specific performance, which is not exercised if the contract is not ''equal and fair'. Even where the contract is not voidable because the conduct of the defendant falls short of fraud, coercion or undue influence such as to justify rescission is shown, the Court may still not enforce the contract if it would not be consistent with equity and good conscience to do so.
43. In the Case of K. Narendra v. Riviera Apartments Private Ltd. [JT 1999 (4) SC 428 : 1999 (37) ALR 9 (Sum.) (SC).] , it has been held by the Supreme Court that the jurisdiction to decree specific performance is discretionary and the Court is not bound to grant such relief merely because it is lawful to do so and that the discretion of the Court ought not to be arbitrary in nature but must be based upon sound and reasonable judicial principles, which may be capable of correction by the Superior Court. In short, grant of decree of specific performance is not automatic even if the agreement is found to be duly executed and the plaintiff ready and willing to perform his part of the agreement but such grant of decree is dependent upon principles of justice, equity and good conscience."
58. Learned Counsel submits that in this case the plaintiff was dealing with an absolutely illiterate man, who could not understand a word of what was scribed in the agreement. The stand of the defendant has been that nothing was read out or explained to him, either by the learned Advocate, who drafted the agreement or in the office of the Sub-Registrar. It is his submission that if the said fact be not proved to the hilt so as to render the contract void, his disability on account of illiteracy is a valid consideration, pitted against a well advised plaintiff, to refuse the discretionary relief of specific performance.
59. On the other hand, learned Counsel for the plaintiff has urged that the discretion ought to be exercised in favour of specific performance, because the plaintiff has performed almost the entire part of the contract by paying the due sale consideration to the defendant at the time of execution of the suit agreement. He points out that ninety percent of the sale consideration has been paid to the defendant, leaving a minuscule part of the plaintiff's obligation to be discharged.
60. This Court has considered the submissions advanced and perused the record.
61. Section 10 of the Specific Relief Act, 1963 [as it stood prior to its amendment vide Act no.18 of 2018 (w.e.f. 01.10.2018)] is quoted below:
"10. Cases in which specific performance of contract enforceable.--Except as otherwise provided in this Chapter, the specific performance of any contract may, in the discretion of the court, be enforced--
(a) when there exists no standard for ascertaining the actual damage caused by the non-performance of the act agreed to be done; or
(b) when the act agreed to be done is such that compensation in money for its non-performance would not afford adequate relief.
Explanation.--Unless and until the contrary is proved, the court shall presume--
(i) that the breach of a contract to transfer immovable property cannot be adequately relieved by compensation in money; and
(ii) that the breach of a contract to transfer moveable property can be so relieved except in the following cases--
(a) where the property is not an ordinary article of commerce, or is of special value or interest to the plaintiff, or consists of goods which are not easily obtainable in the market;
(b) where the property is held by the defendant as the agent or trustee of the plaintiff."
62. A perusal of explanation (i) of Section 10 shows that the law presumes that the breach of a contract to transfer immovable property, cannot be adequately relieved by compensation in money. The aforesaid provision introduces a fundamental rule governing breaches of contract regarding sale of immovable property. It is a remedy provided by statute, that has origins in the old equity jurisdiction in England. Section 73 of the Contract Act postulates damages for the breach of a contract that would include breach of a contract to sell immovable property. The Rule in Section 73 represents the old common law remedy in England for the breach of a contract. In India, as is well known, the source of both remedies are traceable to statutes. But as indicated earlier, the historical origins are different and traceable to two different jurisdictions in England that existed at one time: Common Law and Equity. Equity had its own rules, which have now made their way into statutes. Section 10 provides the fundamental rule about a presumption in favour of the specific performance, so far as contracts governing sale of immovable property are concerned. Section 16(c) details what are known as personal bars to relief. These are traceable not to the idle words of the contract, but the conduct of parties post formation of the contract and until commencement of action. Section 16(c) reads:
"16. Personal bars to relief.--Specific performance of a contract cannot be enforced in favour of a person--
(a) x x x x
(b) x x x x
(c) who fails to prove] that he has performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than terms the performance of which has been prevented or waived by the defendant.
Explanation.--For the purposes of clause (c),--
(i) where a contract involves the payment of money, it is not essential for the plaintiff to actually tender to the defendant or to deposit in court any money except when so directed by the court;
(ii) the plaintiff must prove aver performance of, or readiness and willingness to perform, the contract according to its true construction.
63. The law relating to 'readiness' and 'willingness' to be proved by the plaintiff is well settled. 'Readiness' refers to the financial capacity of the person obliged to perform his part of the contract, whereas 'willingness' refers to his mental state or psychological inclination to perform it. So far as readiness and willingness are concerned, there is no substantial question about it raised before this Court, as such. It only arises in the context whether specific performance could be granted as a matter of course, without any consideration by the Court of evidence, facts and circumstances to exercise discretion in favour of the plaintiff.
64. The law requires that a plaintiff in order to entitle him to the relief of specific performance must show his bona fides throughout, and not just a breach of contract by the defendant. These bona fides are to be judged on the parameters of 'readiness' and 'willingness', and much more. It is the conduct of the plaintiff on a wholesome basis, vis-a-vis the contract and his dealings with the defendant, that is relevant. It is also relevant that he must come to Court with clean hands, candidly disclosing his case and proving it by untainted evidence. This requirement, that would govern discretion of the Court to grant specific performance, has been exposited in the decision of the Supreme Court in Aniglase Yohannan vs. Ramlatha and others, (2005) 7 SCC 534, where it is held:
"12. The basic principle behind Section 16(c) read with Explanation (ii) is that any person seeking benefit of the specific performance of contract must manifest that his conduct has been blemishless throughout entitling him to the specific relief. The provision imposes a personal bar. The Court is to grant relief on the basis of the conduct of the person seeking relief. If the pleadings manifest that the conduct of the plaintiff entitles him to get the relief on perusal of the plaint he should not be denied the relief."
65. The discretion to grant specific performance, is governed by Section 20 of the Specific Relief Act, 1963 [as it stood prior to its amendment vide Act no.18 of 2018 (w.e.f. 01.10.2018)]. Section 20 of the Specific Relief Act, is extracted below:
"20. Discretion as to decreeing specific performance.--(1) The jurisdiction to decree specific performance is discretionary, and the court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal.
(2) The following are cases in which the court may properly exercise discretion not to decree specific performance--
(a) where the terms of the contract or the conduct of the parties at the time of entering into the contract or the other circumstances under which the contract was entered into are such that the contract, though not voidable, gives the plaintiff an unfair advantage over the defendant; or
(b) where the performance of the contract would involve some hardship on the defendant which he did not foresee, whereas its non-performance would involve no such hardship on the plaintiff; or
(c) where the defendant entered into the contract under circumstances which though not rendering the contract voidable, makes it inequitable to enforce specific performance.
Explanation I.--Mere inadequacy of consideration, or the mere fact that the contract is onerous to the defendant or improvident in its nature, shall not be deemed to constitute an unfair advantage within the meaning of clause (a) or hardship within the meaning of clause (b).
Explanation II.--The question whether the performance of a contract would involve hardship on the defendant within the meaning of clause (b) shall, except in cases where the hardship has resulted from any act of the plaintiff, subsequent to the contract, be determined with reference to the circumstances existing at the time of the contract.
(3) The court may properly exercise discretion to decree specific performance in any case where the plaintiff has done substantial acts or suffered losses in consequence of a contract capable of specific performance.
(4) The court shall not refuse to any party specific performance of a contract merely on the ground that the contract is not enforceable at the instance of the other party."
66. What the learned Counsel for the defendant has urged is an argument based on Clause (c) of sub-Section (2) of Section 20 of the Act, last mentioned. It is also based on the principle embodied in sub-Section (1) of Section 20, which makes grant of specific performance, a discretion of the Court, though to be exercised on settled principles.
67. This Court has considered the case that the defendant has attempted to make out. He has urged it to be inequitable to enforce specific performance given the disability of the defendant, arising from his illiteracy. This Court has looked into the evidence and the findings of the two Courts below. It is of paramount importance to note that it is proven by the plaintiff's evidence generally, and particularly, by the Sub-Registrar's endorsement on the suit agreement that the defendant received before the Sub-Registrar a sum of Rs.15,000/-, and further, that he acknowledged that he had received a sum of Rs.30,000/- as an advance. This endorsement by the Sub-Registrar on the suit agreement has been perused by the Court. It is available on record in original. It is an endorsement dated 24.06.1989. The suit agreement also bears the photograph of the defendant as well as the plaintiff. There is a presumption about the genuineness of the Sub-Registrar's endorsement. Since the suit agreement bears the defendant's photograph, it is safe to presume that nobody else made this acknowledgment before the Sub-Registrar. It is, thus, evident that there is evidence of a highly dependable character, available on record to show that the defendant had received a total sum of Rs.45,000/- from the plaintiff in terms of the suit agreement, at the time when this agreement was executed. The endorsement also indicates that the defendant had signed it after understanding its contents. About that part also, there is a presumption as to its correctness.
68. In the evidence of witnesses, there is a consistent affirmation of fact that Rs.30,000/- were received by the defendant as earnest back home on 22nd June, 1989, two days before the suit agreement was executed. It has been remarked by the Lower Appellate Court that the defendant's case is that he had received Rs.15,000/- only that day at the plaintiff's home, but he accepts that it was received before Ramesh Singh, Ram Shanker Singh, Jagdish Singh and Natthu Singh. Ramesh Singh and Ram Shanker Singh, being the plaintiff and the plaintiff's uncle, Jagdish Singh and Natthu Singh could well be called by the defendant to prove that he had received as earnest a sum of Rs.15,000/-, and not Rs.30,000/-. It has also been remarked by the Lower Appellate Court that the defendant has not clarified why these two witnesses were not summoned by him to prove his case.
69. This Court need no go into the details of these findings. All that this Court is required to examine is whether the Lower Appellate Court's findings about the issue of payment of Rs.45,000/- in two parts, as claimed by the plaintiff, is based on relevant evidence and draws reasonable conclusions. About that, this Court has no doubt. Moreover, the defendant has not adduced any evidence to rebut the presumption that attaches to the Sub-Registrar's endorsement, above described.
70. Once this Court is assured that the Lower Appellate Court has rightly concluded that the defendant has received a sum of Rs.45,000/-, out of the total sale consideration of Rs.50,000/- agreed, the scales for the exercise of discretion in favour of specific performance are decisively tipped. The fact that the defendant has received a sum of Rs.45,000/- for one part, excludes any doubt about the defendant being inequitably dealt with by the plaintiff on account of his illiteracy etc. At the same time, the fact that the defendant has received a sum, that accounts for ninety percent of the sale consideration, places the plaintiff in a position where he has done substantial acts in performance of his part of the contract. Nothing remains to be done on the plaintiff's part, except payment of the balance of Rs.5000/- and meeting the expenses of execution and registration of the conveyance. The doing of all substantial acts in performance of the plaintiff's part of the contract is a relevant consideration, under sub-Section (3) of Section 20 of the Specific Relief Act.
71. So far as equities go, a fact which the learned Counsel has impressed upon this Court to work in the defendant's favour at this stage, is the escalation in prices. It is decisive according to him. There may be cases where price rise may be decisive, but not in every case. In this connection, reference may be made to a decision of the Supreme Court in P. D'Souza vs. Shondrilo Naidu, (2004) 6 SCC 649. In P. D'Souza (supra), the issue about the relevance of escalation in price was considered by the Court in the context of discretion to grant specific performance. It was held in P. D'Souza (supra) thus:
"39. It is not a case where the defendant did not foresee the hardship. It is furthermore not a case that non-performance of the agreement would not cause any hardship to the plaintiff. The defendant was the landlord of the plaintiff. He had accepted part-payments from the plaintiff from time to time without any demur whatsoever. He redeemed the mortgage only upon receipt of requisite payment from the plaintiff. Even in August 1981 i.e. just two months prior to the institution of suit, he had accepted Rs 20,000 from the plaintiff. It is, therefore, too late for the appellant now to suggest that having regard to the escalation in price, the respondent should be denied the benefit of the decree passed in his favour. Explanation I appended to Section 20 clearly stipulates that merely inadequacy of consideration, or the mere fact that the contract is onerous to the defendant or improvident in its nature would not constitute an unfair advantage within the meaning of sub-section (2) of Section 20.
40. The decision of this Court in Nirmala Anand [(2002) 5 SCC 481] may be considered in the aforementioned context.
41. Raju, J. in the facts and circumstances of the matter obtaining therein held that it would not only be unreasonable but too inequitable for courts to make the appellant the sole beneficiary of the escalation of real estate prices and the enhanced value of the flat in question, preserved all along by Respondents 1 and 2 by keeping alive the issues pending with the authorities of the Government and the municipal body. It was in the facts and circumstances of the case held: (SCC p. 501, para 23) "23. ... Specific performance being an equitable relief, balance of equities have also to be struck taking into account all these relevant aspects of the matter, including the lapses which occurred and parties respectively responsible therefor. Before decreeing specific performance, it is obligatory for courts to consider whether by doing so any unfair advantage would result for the plaintiff over the defendant, the extent of hardship that may be caused to the defendant and if it would render such enforcement inequitable, besides taking into (sic consideration) the totality of circumstances of each case."
42. The Court for arriving at the said finding gave opportunities to the parties to settle the matter and Respondents 1 and 2 were prepared to pay up to Rs 60 lakhs as against the demand of the appellant to the tune of rupees one-and-a-half crores which was subsequently reduced up to Rs 120 lakhs. In view of the respective stands taken by the parties, the Court inter alia directed Respondents 1 and 2 to pay a sum of Rs 40 lakhs in addition to the sum already paid by them.
43. Bhan, J., however, while expressing his dissension in part observed: (SCC pp. 506 & 507, paras 38 & 40) "38. It is well settled that in cases of contract for sale of immovable property the grant of relief of specific performance is a rule and its refusal an exception based on valid and cogent grounds. Further, the defendant cannot take advantage of his own wrong and then plead that decree for specific performance would be an unfair advantage to the plaintiff.
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40. Escalation of price during the period may be a relevant consideration under certain circumstances for either refusing to grant the decree of specific performance or for decreeing the specific performance with a direction to the plaintiff to pay an additional amount to the defendant and compensate him. It would depend on the facts and circumstances of each case."
45. The said decision cannot be said to constitute a binding precedent to the effect that in all cases where there had been an escalation of prices, the court should either refuse to pass a decree on specific performance of contract or direct the plaintiff to pay a higher sum. No law in absolute terms to that effect has been laid down by this Court nor is discernible from the aforementioned decision."
72. It would, thus, appear that there is no straitjacket formula that governs the exercise of discretion to grant or refuse specific performance on account of price escalation. In this case, what is most pertinent, is that the suit was instituted promptly and within a year of the suit agreement. In fact, it was instituted during time contemplated by the agreement, which was one year, once the plaintiff noticed refusal. This adds to the bona fides about his claim and strengthens entitlement to the relief of specific performance that he seeks.
73. The suit, thus, instituted on 31.05.1990, was decided by the Trial Court on 03.02.1992. The plaintiff loosing before the Trial Court, promptly lodged an appeal. The appeal was filed to the District Judge on 03.03.1992. The appeal was decided on 31.08.1992. The Lower Appellate Court on 31.08.1992 decreed the suit. Now, the defendant filed the present appeal before this Court on 15.02.1993. It was admitted to hearing on 16.02.1993 and the decree stayed till further orders. Thus, the plaintiff secured the decree before the Lower Appellate Court within a span of about two years and a half. The long lapse of time during which the decree has remained in limbo is on account of pendency of this second appeal before this Court, preferred by the defendant.
74. There is nothing to show that the plaintiff has decisively contributed to this delay in any manner. The price rise, if that be a factor, during these twenty-seven years that this second appeal by the defendant has remained pending, cannot be capitalized upon to sway this Court's discretion. This Court is assured that the Lower Appellate Court has rightly exercised discretion to grant specific performance on the facts of the case, the pleadings of parties, the evidence on record and circumstances that appear. Substantial question of law no.7 is answered in the negative, but in terms that the discretion has been properly exercised on a consideration of relevant evidence, facts and circumstances by the Lower Appellate Court.
75. In the result, the second appeal fails and is dismissed with costs to the plaintiff in all Courts.
76. Let a decree be drawn up, accordingly.
Order Date :- 24.8.2020 Anoop