Delhi District Court
Tis Hazari CourtDelhi vs Sh. Krishan Lal on 24 February, 2012
IN THE COURT OF SHRI VIKRAM CIVIL JUDGE OF (NORTH) DISTRICT,
TIS HAZARI COURTDELHI
Suit No. 185/06 [CS (OS) 871/77]
SUIT FOR SPECIFIC PERFORMANCE
Unique ID No.02401C0029451995
MEMO OF PARTIES:
Sh. Mahinder Lal (since deceased)
through his Legal Representatives:
1(a) Smt. Kanta Rani,
Widow of Late Sh. Mahinder Lal,
R/o 4/5846, Dev Nagar,
Karol Bagh, New Delhi
1(b) Sh. Rajesh Kumar,
S/o Late Sh. Mahinder Lal,
R/o 4/5846, Dev Nagar,
Karol Bagh, New Delhi
1(c) Smt. Meena Sood,
D/o Late Sh. Mahinder Lal,
D301, Sarvodaya Enclave,
New Delhi
1 (d) Smt. Anita Kantor
D/o Late Sh. Mahinder Lal
R/o 5106/1, Kishan Nagar,
Karol Bagh, New Delhi
...........Plaintiffs
VERSUS
Sh. Krishan Lal,
(Since deceased through legal heirs)
(1) Sh. Pyare Lal (since deceased)
S/o Late Sh. Krishan Lal
Through his legal heirs
(i) Smt. Mohan Devi W/o Late Sh. Pyare Lal
(ii) Raj Kumar S/o Late Sh. Pyare Lal
(iii) Tilak Raj S/o Late Sh. Pyare Lal
(iv) Uttam Chand S/o Late Sh. Pyare Lal
(v) Rakesh Kumar S/o Late Sh. Pyare Lal
(vi) Mohan Kumar S/o Late Sh. Pyare Lal
(vii) Pushpa Rani D/o Late Sh. Pyare Lal
(viii) Yudhisthir Raj S/o Late Sh. Pyare Lal
All R/o: H16/648, Gali No. 13,
Military Road, Bapa Nagar
Karol Bagh,
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 1
New Delhi - 1100 05
(2) Mr. Panna Lal ( since deceased)
S/o Late Sh. Krishan Lal
R/o 5846, Block - 4
Gali No. 6, Dev Nagar, karol Bagh
New Delhi - 11 00 05
(3) Ms. Indira
W/o Sh. Mahinder Singh
D/o Later Sh. Krishan Lal
R/o 130, Kalka Garhi
Ghaziabad (U.P)
(4) Ms. Dharam Devi
W/o Sh. Narian Singh,
D/o Late Sh. Krishan Lal
R/o 130, Kalka Garhi
Ghaziabad (U.P)
(5) Ms. Bimla Devi
W/o Sh. Shiv Dayal
D/o Late Sh. Krishan Lal
8/36, Mohalla Garhai
Delhi 11 00 32
(6) Ms. Prem Lata
W/o Sh. Inderjeet
D/o Late Sh. Krishan Lal
R/o 6095, Gali Ravi Das
Nabi Karim, Paharganj,
New Delhi - 11 00 55
(7) Ms. Leelawati
W/o Sh. Jai Prakash
D/o Late Sh. Krishan Lal
R/o 6095, Gali Ravi Das
Nabi Karim, Paharganj,
New Delhi - 11 00 55
(8) Mr. Hardwari
S/o Late Sh. Krishan lal
5846, Block - 4 Gali No. 6
Dev Nagar, Karol Bagh
New Delhi - 11 00 05
(9) Mr. Brij Mohan
S/o Late Sh. Krishan Lal
5846, Block - 4, Gali No. 6
Dev Nagar, Karol Bagh
New Delhi - 11 00 05
..........Defendants
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 2
Date of Institution of suit : 03.10.1977
Date on which judgment reserved : 28.01.2012
Date of announcement of common judgment : 24.02.2012
AND ALSO IN
Suit No. 113/06 (1/82)
SUIT FOR REDEMPTION
Unique ID No.02401C0000651982
MEMO OF PARTIES:
Sh. Krishan Lal
(Since deceased through legal heirs)
(1) Sh. Pyare Lal (since deceased)
S/o Late Sh. Krishan Lal
Through his legal heirs
(i) Smt. Mohan Devi W/o Late Sh. Pyare Lal
(ii) Raj Kumar S/o Late Sh. Pyare Lal
(iii) Tilak Raj S/o Late Sh. Pyare Lal
(iv) Uttam Chand S/o Late Sh. Pyare Lal
(v) Rakesh Kumar S/o Late Sh. Pyare Lal
(vi) Mohan Kumar S/o Late Sh. Pyare Lal
(vii) Pushpa Rani D/o Late Sh. Pyare Lal
(viii) Yudhisthir Raj S/o Late Sh. Pyare Lal
All R/o: H16/648, Gali No. 13,
Military Road, Bapa Nagar
Karol Bagh,
New Delhi - 1100 05
(2) Mr. Panna Lal ( since deceased)
S/o Late Sh. Krishan Lal
R/o 5846, Block - 4
Gali No. 6, Dev Nagar, karol Bagh
New Delhi - 11 00 05
(3) Ms. Indira
W/o Sh. Mahinder Singh
D/o Later Sh. Krishan Lal
R/o 130, Kalka Garhi
Ghaziabad (U.P)
(4) Ms. Dharam Devi
W/o Sh. Narian Singh,
D/o Late Sh. Krishan Lal
R/o 130, Kalka Garhi
Ghaziabad (U.P)
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 3
(5) Ms. Bimla Devi
W/o Sh. Shiv Dayal
D/o Late Sh. Krishan Lal
8/36, Mohalla Garhai
Delhi 11 00 32
(6) Ms. Prem Lata
W/o Sh. Inderjeet
D/o Late Sh. Krishan Lal
R/o 6095, Gali Ravi Das
Nabi Karim, Paharganj,
New Delhi - 11 00 55
(7) Ms. Leelawati
W/o Sh. Jai Prakash
D/o Late Sh. Krishan Lal
R/o 6095, Gali Ravi Das
Nabi Karim, Paharganj,
New Delhi - 11 00 55
(8) Mr. Hardwari
S/o Late Sh. Krishan lal
5846, Block - 4 Gali No. 6
Dev Nagar, Karol Bagh
New Delhi - 11 00 05
(9) Mr. Brij Mohan
S/o Late Sh. Krishan Lal
5846, Block - 4, Gali No. 6
Dev Nagar, Karol Bagh
New Delhi - 11 00 05
Plaintiffs...........
VERSUS
Sh. Mahender Lal
(Since deceased, through legal heirs)
(i) Smt. Kanta rani
Wd/o Late Mahender Lal
(ii) Sh. Rajesh
S/o Late Mahender Lal
(iii) Smt. Meena
D/o Late Mahender Lal
(iv) Smt. Anita
D/o Late Mahender Lal
All R/o: 5846, Gali No. 6
Dev Nagar, Karol Bagh,
New Delhi 11 00 05
..........Defendants
Date of Institution of suit : 24.12.1981
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 4
Date on which judgment reserved : 28.01.2012
Date of announcement of common judgment : 24.02.2012
COMPOSIT JUDGMENT
1. By this composite judgment I shall decide two suits. The first suit is
for Specific performance of contract filed by mortgagee and second suit is
for Redemption of mortgage filed by mortgagor.
2. Undisputed facts between parties are that Sh. Kishal Lal (herein after
referred to as 'mortgagor') is the owner of 2 and half story building bearing
number 4/5846 Gali No.1, Dev Nagar, Karol Bhag New Delhi (in short the
suit property). On 01.02.1969 the mortgagor had given the ground floor
premises on rent, comprising of two bedrooms, kitchen, store, latrine and
varandah to Sh. Mahinder Lal (herein after referred to as 'mortgagee') vide
rent agreement dated 01.02.1969, for Rs. 110/ per month. On 04.06.1973 a
simple mortgage was executed between mortgagor and mortgagee in respect
to the suit property.
3. On 03.10.1977 mortgagee filed a suit for specific performance against
mortgagor. This suit is the first suit between parties. The suit was initially
filed before Hon'ble High Court in Original Jurisdiction and it was registered
as CS (OS) 871/77 (herein after referred to as mortgagee's suit for specif
performance).
4. In mortgagee's suit, brief facts as averred in plaint are that the
mortgagor raised a loan of Rs. 32,000/ on the security of suit property by
way of simple mortgage on 4th June 1973 carrying interest @ 7 ½% p.a. from
mortgagee. Later on 19th Dec. 1974 mortgagor agreed to sale the entire suit
property, including land underneeth, in favour of mortgagee for a
consideration of Rs. 80,000/ and received a sum of Rs. 10,000/ by way of
earnest money and agreed to receive another Rs. 10,000/ by way of
additional earnest money and also agreed to execute the sale deed with in
six months. On same day mortgagor executed the receipt having received
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 5
the sum of Rs. 10,000/. By January mid mortgagor received another sum of
Rs. 3000/ in cash and a post dated cheque dated 21.01.1975 for RS. 3000/
was also paid. On 21.01.1975 mortgagor further took Rs. 3,000/ and
returned the cheque. However he refused to to take the balance of Rs.
4,000/ out of later Rs.10,000/ of earnest money on the ground that he
would take it against 'Pakki receipt' at the time of registration of sale deed.
5. It was also agreed between parties that amount of mortgage of Rs.
32,000/ will stand as paid to the defendant towards sale consideration. It
was also agreed that mortgagor would deliver the vacant possession of the
portion of suit property in his occupation at the time of execution of sale
deed. It is stated in the plaint that mortgagee was always ready and willing to
perform his part of contract, pay the balance price and to have the sale deed
executed in his favour but the mortgagor has been postponing the same.
The mortgagee issued notice upon mortgagor dated 22.04.1977 calling upon
the execution of sale deed with a request to obtain the Income Tax
Clearance Certificate and also the permission under Section 27 of the Urban
land (Ceiling & Regulation) Act, 1976 from the Competent Authority. The
mortgagor sent a reply to the notice of mortgagee to his counsel completely
denying the agreement to sale and the receipt of earnest money etc. and
refused to perform his part of contract, vide reply dated 05.05.1977.
6. It is stated in the plaint that when the agreement to sale was entered
into, the only requirement on the part of mortgagor was to obtain
permission from the Income Tax Department i.e. Tax Clearance Certificate.
The Urban Land (Ceiling & Regulation) Act came into force in 1976,
therefore, it was for the mortgagor to obtain permission from Competent
Authority under this Act. It was the duty of mortgagor to sign and submit
necessary applications to the officers/departments concerned and to obtain
permission to sell the property.
7. The mortgagor refused to perform his part of contract and refused to
abide by terms of agreement to sale, therefore mortgagee filed this suit for
specific performance. It is stated that cause of action arose in favour of
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 6
mortgagee in August 1975 when mortgagor failed to perform his part of
contract, from various demands thereafter and finally in may 1977.
8. In written statement to plaint, mortgagor took preliminary objections
that the plaint lacks the requisite particulars as it does not mention as to
when the alleged agreement was to be performed and whether the
agreement to sell was executed by mortgagor in favour of mortgagee or
whether same was oral. Mortgagor denied execution of any agreement to sell
or receiving of any amount in consideration or earnest money on 19th
December, 1974 or at any subsequent date. Mortgagor further stated that the
alleged receipt relied by mortgagee is false and fabricated. Mortgagor further
took objection that the suit has been instituted after enforcement of Urban
Land (Ceiling & Regulation)Act, 1976 and as per Section 27(1) of the Act
there is a bar on transfer of property by any means without seeking previous
permission in writing from Competent Authority after following special
procedure provided under the Act.
9. Mortgagor took further objection that the suit is not properly valued
for the purpose of Court fee and Jurisdiction and stated that in the suit
plaintiff (mortgagee) has not valued the suit qua the portion which is not in
his possession and for which relief of possession is sought. Another
objection taken in the written statement is that the plaint is vague and
indefinite as it is not written in plaint, which portion of the suit property is in
possession of mortgagee and which portion is in possession of mortgagor.
10. On merits in written statement mortgagor admitted the mortgage but
his version is that he received from time to time a total amount of Rs.
25,000/ and executed a simple mortgage on 04th June 1973 in respect to suit
property in favour of mortgagee with agreed rate of interest @ 7.5% per
annum. Mortgagor denied that he execute mortgage for Rs. 32000/ and
stated that as he agreed to pay permissible interest @ 7.5% p.a. and the
market rate was much more, therefore, mortgagee may have written the
mortgage amount as Rs. 32,000/ instead of Rs. 25000/. Mortgagor also
stated that he is illiterate person and can only sign in Hindi Script. It is
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 7
further stated that mortgagor was paying the interest time to time but the
mortgagee never issued any receipt. It is also stated in the written statement
that prior to the execution of mortgage, Smt. Kanta Rani (mortgagee's wife)
took ground floor of the suit property on rent of Rs. 200/ p.m. and
mortgagor himself is in occupation of Barsati Floor and first floor.
11. In written statement mortgagor denied the entire allegation of
plaintiff regarding agreement to sell dated 19.12.1974 and the subsequent
allegations regarding payments of earnest money by various transaction, as
false and incorrect. Mortgagor also denied execution of receipt of Rs.
10,000/ dated 19.12.1974 and alleged that same is forged. Mortgagor
however admitted that the sale deed of suit property is with mortgagee,
given at the time of execution of mortgage deed. He also admitted the
receiving of notice dated 22.04.1977 but stated that it was a frivolous notice
and further stated that reply to that notice was duly sent on 05.05.1977. Rest,
mortgagor denied the suit of plaintiff as false and denied that he is liable to
perform such acts as demanded in the plaint.
12. In replication the plaintiff/mortgagee denied all the objections as
wrong and reiterated the contents of plaint. In addition mortgagee stated
that mortgagor has let out entire house to Smt. Kanta Rani at Rs. 200/p.m.
and after execution of mortgage deed, the mortgagor, the mortgagee and
Mrs. Kanta Rani agreed that amount of monthly rent of Rs. 200/ being equal
to the interest payable by mortgagor to the mortgagee, be paid by Mrs.
Kanta Rani to mortgagee. It is also stated that mortgagor issued instruction
to the tenant of the first floor to attorn in favour of Mrs. Kant Rani and pay
the rent to her, who has been paying rent to Mrs. Kant Rani. Mortgagee also
acknowledged the payment of Rs. 200/ p.m. from Mrs. Kanta Rani towards
the interest payable by mortgagor to mortgagee. It is also added in the
replication that earlier mortgagor had mortgaged the property with one Sh.
Ramesh Chander and as there was a pressing demand from him, the
mortgagor approached the plaintiff/mortgagee for a loan Of Rs. 11,000/
with interest @ 1% per months and let out three rooms to the
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 8
plaintiff/mortgagee on the ground floor @ Rs. 110/ p.m. and it was agreed
that the interest on loan would be adjusted towards rent payable as the
amount of rent as well as of interest was same.
13. Plaintiff/mortgagee further added in replication that
defendant/mortgagor further requested for RS. 6,600/ which again loaned
at the rate of interest of 1% per month vide mortgagor's pronote dated
09.02.1970. However mortgagor needed more money to clear mortgage debt
therefore defendant/mortgagor and plaintiff/mortgagee entered into an
agreement dated 10.02.1970 on various terms and it was agreed that after
this agreement defendant/mortgagor shall not further mortgage or sell the
suit property without consent of plaintiff. It is after all these the mortgage
deed dated 04.06.1973 was executed between parties.
14. After completion of pleadings following issues were framed;
1.Whether the defendant entered into the agreement to sell dated 19th
December, 1974, with the plaintiff with respect to suit property? If so, what
are its terms?
2.How much amount has been paid by plaintiff towards the agreement of
sale?
3.Whether the plaintiff has been ready and willing to perform his part of
contract?
4.Whether defendant has committed breach of contract?
5.What is the effect of not applying for obtaining permission from the income
tax officer to transfer the property and also of permission under the Urban
Land (Ceiling & Regulation) Act, by the defendant?
6.Whether the suit has not been properly valued for the purpose of Court fee
and Jurisdiction?
7.Relief.
15. After the suit of mortgagee for specific performance of contract, on
24.12.1981 mortgagor filed suit for redemption against mortgagee for
redemption of the mortgage property i.e. suit property. Vide order dated
19.10.82 the suit for redemption was ordered to be tried with mortgagee's
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 9
suit for specific performance. As the trial was held jointly all proceedings
were conducted in mortgagee's suit for specific performance of contract.
16. The mortgagor filed his suit for redemption on 24.12.1981. As per
plaint of mortgagor in redemption suit, facts in brief are that mortgage was
executed in respect to suit property vide registered mortgage deed dated 4th
June, 1973 bearing as No. 3748, Addl. Book No.1, Vol. No. 3157 Page No. 76
to 82 Distt. III, Asaf Ali Road, New Delhi. It is stated that it was a simple
mortgage without possession in the sum of Rs. 32,000/ which mortgagee
got executed by playing fraud and applying undue influence. It is stated that
the actual amount borrowed by the mortgagor was Rs. 25,000/ only.
17. Mortgagor has stated in the plaint that prior to mortgage there was an
agreement of rent dated 01.02.1969 with respect to ground floor portion of
the suit property @ monthly rent of Rs. 110/ comprising of two rooms, bath,
kitchen, store, latrine and varandah for residential purpose. The rent note
was renewed in favour of mortgagee's wife Smt. Kanta Rani on 7th June 1973
@ enhanced monthly rent of Rs. 200/ on account of increase of income tax
and other charges as well as on making some improvements in the premises.
It is stated that mortgagee continued to be tenant in respect to the tenanted
premises and defendant has not paid any rent from 01.02.1969 as the
mortgagee agreed to adjust the same in loan amount. It is further stated by
mortgagor that he is entitled to adjust arrears of rent w.e.f. 01.02.1969 to
06.06.1973 @ Rs. 110/ and arrears of water and electricity charges paid to
authorities which in total comes to Rs. 7000/. It is also stated that
mortgagor is also entitled to adjust the amount of rent @ Rs. 200/ p.m. from
07.07.1973 to 31.12.1981 which comes to Rs. 20000/, therefore, amount of
Rs. 27,000/ is due from mortgagee.
18. It is also stated by mortgagor in the plaint that being worried to pay of
the debt of mortgagee of Rs. 25,000/ mortgagor authorised the mortgagee to
realise the rent from the tenant of mortgagor Sh. A. Mitra on first floor, of Rs.
155 and the mortgagee has realised a sum of Rs. 7,440/ from Sh. A. Mitra. It
is therefore plaintiff has stated that the total adjustable amount from the
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 10
loan amount due from mortgagee comes to Rs. 34,440/.
19. Mortgagor has further stated that the mortgagee is entitled to interest
@ 7.5% from 07.06.1973 to 31.12.1981 which comes to Rs. 15,700/ and the
total amount of principal due i.e. mortgage money of Rs. 25,000/ and
interest due from the mortgagor to mortgagee comes to Rs. 40,700/. On this
calculation mortgagor has stated that after deducting the mortgagor's claim
of arrears of rent and other expenses from the amount due to mortgagee,
balance sum of Rs. 6,260/ stands payable towards the satisfaction of total
claim under the mortgage of property.
20. Mortgagor has stated in the plaint that on 14.12.1981 a notice was
sent to mortgagee to acknowledge the above amount and free the mortgagor
from his liability after accepting the same. But the mortgagee did not do so
therefore mortgagor filed the suit for redemption. Mortgagor has prayed for
passing decree of redemption and direct the mortgagee to hand over the
possession of property and all the documents of title in respect to suit
property.
21. In written statement filed by mortgagee he took preliminary
objections that there is novation of contract between parties and on
19.12.1974 the mortgagor agreed to sell the suit property to the mortgagee
for consideration of Rs. 80,000/ and received a sum of Rs. 10,000/ by way
of earnest money and executed a receipt dated 19.12.1974 incorporating the
terms of agreement dated 19.12.1974. It is also stated that by mid of January
mortgagor also received another sum of Rs. 3,000/ in cash and a post dated
cheque of Rs. 3,000/ dated 21.1.1975 against receipt. It is also stated that on
21.01.1975 mortgagor returned the cheque and took cash, however
mortgagor did not take balance sum of Rs. 4,000/ as per arrangement on
the ground that he would take against pakki receipt at the time of
registration of sale deed. Mortgagee has also stated that amount of
mortgagee of Rs. 32,000/ will stand paid to the mortgagor by mortgagee
towards the sale consideration on the date the sale deed is executed by the
mortgagor to the mortgagee.
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 11
22. Mortgagee also objected the suit stating that the relationship of
landlord and tenant existed between mortgagor and Smt. Kanta Rani by a
separate agreement through duly registered rent note therefore the relief of
handing over the possession is not maintainable specially when the
mortgage was without possession. It is also stated that the suit for
possession is not maintainable as the mortgagee is in possession of premises
in part performance of agreement to sell. Mortgagee also objected the suit
for wrong valuation of suit for the purpose of Court fee and jurisdiction.
23. On merits in written statement mortgagee denied that mortgage was
for Rs. 25,000/ or any fraud was played upon mortgagor. Mortgagee stated
that mortgage amount was for Rs. 32,000/. Mortgagee further stated that on
07.06.1973 mortgagor entered into agreement with Smt. Kanta Rani with
right to sublet and receive rent from the tenants already in occupation. It
was further agreed that the interest of mortgage will be adjusted towards
rent of property, keeping the original amount intact. Mortgagee further
stated that as on 19.12.1974 mortgagor entered into agreement to sell the
suit property at Rs. 80,000/ and received a sum of Rs. 16,000/ the total
amount received is Rs. 48,000/. Mortgagee also stated that it was the
mortgagor himself who said the tenant Sh. A. Mitra to attorn to Smt. Kanta
Rani and pay her the rent. For rest the contents of plaint are denied being
wrong and false.
24. In replication to the mortgagee's written statement mortgagor stated
that the preliminary objections are wrong and false. It is stated that there
was never any novation of any contract either orally or in writing. Mortgagor
further denied the agreement to sell the suit property or receipt of Rs.
10,000/ as earnest money. Mortgagor further denied the receipt of Rs.
3000/ in cash and post dated cheque of Rs. 3000/ or its return in exchange
of cash. Mortgagor also denied that he refused to accept Rs. 4000/ on the
ground that he would accept it at the time of registration against pakki
receipt. The mortgagor reiterated his claim that the mortgage was for Rs.
25,000/ and the mortgagee executed the deed of Rs. 32000/. mortgagor
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 12
further stated in reply to preliminary objection no.3 that there were three
tenants in the suit property and he executed rent note in favour of Smt.
Kanta Rani on 04.06.1973 but said rent note was never acted upon as Smt.
Kanta Rani never paid any rent and also stated that the tenancy created on
30.1.1969 is already terminated and mortgagee has not handed over the
property till date, to Smt. Kanta Rani. It is stated that Smt. Kanta Rani lives in
the same house being wife of mortgagee and not as a tenant. It is also stated
that the whole house was fetching Rs. 465/ per month so there is no
question of giving whole house on rent of Rs. 200. It is also stated in
replication that mortgagee is living in the ground floor of suit property as
tenant not in part performance of any agreement to sell. It is stated the the
alleged agreement is created by the defendant/mortgagee with ulterior
motive to grab the property. On parawise replication to written statement
the mortgagor reiterated the content of plaint and stated that there was no
agreement to sell. Mortgagor reiterated that the mortgagee may have written
in the mortgage deed Rs. 32,000/ but the correct amount was Rs.25,000/. It
is further stated that the rent note has been got executed by mortgagee in
favour of Smt. Kanta Rani at the rate of Rs. 200/ per month only because
mortgagee wanted interest of Rs. 200/ per month and not the actual interest
of Rs. 156.25. It is also stated that mortgagee has taken undue advantage of
illiteracy of mortgagor. It is also stated the mortgagor asked Sh. A. Mitra to
pay the monthly rent to the mortgagee only because he was desirous to pay
off the loan amount to the mortgagee speedily and Rs. 7740 paid by Sh. A.
Mitra is adjustable in the loan amount.
25. In this suit for redemption of mortgage, on 03.09.1984 from the
pleadings following issues were framed;
1.Whether the plaintiff is entitled to redeem the property?
2.If issue no.1 is is proved, how much amount the plaintiff is liable to pay for
redeeming the property?
3.Relief.
26. After framing issues in suit for redemption on same day this suit for
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 13
redemption was consolidated with mortgagee's suit for specific
performance and it was ordered that evidence shall be recorded in the
mortgagee's suit for specific performance.
27. Therefore, in mortgagee's suit for specific performance the first
evidence was lead by mortgagee as plaintiff evidence and the mortgagor lead
his evidence in defence.
28. The mortgagee in PE produced 9 witnesses to prove his suit for
specific performance and in defence of mortgagor's suit for redemption of
mortgage.
29. Plaintiff himself appeared as Pw1 and deposed on oath in the court.
Pw1 deposed that mortgagor mortgaged the suit property with him for Rs.
32,000/ in presence of attesting witness Sh. Milkhi Ram. Pw1 produced the
mortgage deed as Ex.P1. After that Pw1 explained how he paid the mortgage
money to mortgagor. Pw1 deposed that he "paid Rs. 11,000/ in one
installment, Rs. 1600/ in another installment, Rs 6600/ in another, Rs.
600/, Rs. 220/ and Rs. 10,000/ Rs. 2200/ was paid as interest and Rs.
10,000/ was paid before the registrar. The entire amount of Rs. 32,000/ was
paid before the defendant executed the mortgage deed Ext. P1". Pw1 also
deposed that defendant agreed to sell the suit property in his favour for Rs.
80,000/in all. He deposed that he paid Rs. 1500/ to the defendant about
one month prior to the execution agreement and paid Rs. 8,500/ at the
time of execution of agreement. This agreement was produced in evidence
as mark X.
30. Pw1 deposed that Sh. Dina Nath Broker wrote Mark X and read the
same to both parties and the defendant signed on the revenue stamp of 10
paisa at the foot of agreement in his presence after admitting the contents as
correct. Pw1 also deposed that the defendant before signing on the revenue
stamp made some writings on mark X at its foot. This writing was encircled
in red at the time of evidence. Pw1 also deposed that he had to pay Rs.
10,000/ within six months of the execution of Mark X for which he gave Rs.
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 14
3000/ in cash in Jan. 1975 and gave a post dated cheque of Rs. 3000/ dated
21.07.75 against the receipt Ext. P2A signed by defendant in presence of
Pw1. Pw1 also deposed that defendant did not cash the cheque and returned
and took Rs. 3000/ in cash against receipt Ext. P3. Pw1 further deposed that
rest amount was not paid to defendant as the defendant stated that he
would get that when he would get the sale deed executed. Pw1 also deposed
that the mortgage amount was to be adjusted in the sale consideration of Rs.
80,000/ at the time of registration of sale deed.
31. Pw1 has further deposed that he has been asking the defendant to
obtain necessary certificate from the income tax authorities and from Land
Development Office, but the defendant did not obtain any of them. Pw1
deposed that he served a legal notice Ext. P4 through Sh. S. C. Chhabra,
Advocate. Pw1 produced its postal receipt Ext. P5 and the reply to notice
from defendant Ext. P6. Pw1 also deposed that he has been ready and
willing to purchase the suit property in accordance with the agreement
between parties. Pw1 had the money ready with him to pay to defendant.
32. Pw1 also deposed that his wife had executed a rent note in favour of
the defendant in respect to entire property for Rs. 200 per month, however
she was not to pay any rent to the defendant and the rent amount of Rs.
200/ was to be adjusted towards the interest on the mortgage amount. Pw1
further deposed that in the suit property he was in possession of ground
floor and the defendant/mortgagor was on second floor and the first floor
was in possession of a tenant Sh. A. Mitra who was made liable to pay rent to
Smt. Kanta Rani. Pw1 produced Ext. P2 written by defendant to Sh. A. Mitra
to attorn in favour of Smt. Kanta Rani.
33. In cross examination Pw1 stated that Mark X is the only document
executed for the sale of suit property. Pw1 stated in cross that the day on
which Mark X was executed i.e. 19.12.1974 was a holiday and the
defendant/mortgagor had told that he would execute the agreement on a
stamp paper on next day. On question as to witness in agreement Pw1 stated
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 15
that defendant/mortgagor told him that a proper agreement on stamp paper
would be executed on next day therefore it was not considered necessary to
pay the attestation of witness in the agreement mark X. Explaining this
further Pw1 said that he purchased stamp paper on next day and asked
defendant/mortgagor to execute the same but the defendant declined to
execute. Pw1 was directed to produce those stamp papers and on next date
of hearing. Pw1 produced those blank stamp papers along with sale original
sale deed which were placed on record.
34. Pw1 was further questioned for the blank space left in Mark X
regarding the date of payment of Rs. 10,000/ to which he explained that it
was left blank as defendant/mortgagor stated that he would tell the date on
the next day when the formal agreement was to be executed. In later part of
cross examination Pw1 stated that defendant did not agreed to write a
regular agreement but had agreed to sell the property i.e. to execute the sale
deed in six months. Pw1 stated in cross examination that Sh. Dina Nath did
not sign Mark X as the scriber as he stated that he would sign the regular
agreement to sell when the same would be executed.
35. On next date of cross examination Pw1 stated that he do not
remember the exact date when he paid Rs. 3000/ but was paid in first week
of January 1975. Pw1 was asked for the reason why the documents Ex.P3
and Ext. P2A are undated to which no reason was assigned. On this date
Pw1 stated in cross examination that defendant declined to execute regular
agreement sometimes in April, 1975. He also stated that he never stated in
cross examination that defendant had refused to execute the regular
agreement on the next date of execution of document Mark X. Pw1 stated
that he did not issue any notice to defendant calling him to execute regular
agreement. In cross examination as to the acknowledgment at the foot of
Mark X Pw1 stated that he do not know if Kishan Lal is illiterate. In cross
examination Pw1 further stated that his counsel had drafted the plaint
making it a suit for recovery of Rs. 32,000/ although the sum of Rs. 33,200/
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 16
was due to him from defendant/mortgagor. He also stated that the suit has
been filed for Rs. 32000/ because his lawyer told him that suit may be filed
for Rs. 32,000/ and remaining amount shall be considered later.
36. Pw1 admitted that he is tenant in the house of defendant since
30.01.1969 and he executed the rent note Ex.D1. Pw1 also stated that one
paper was attached to the rent note which was to the effect that defendant
shall set off the rent payable against interest payable by defendant on the
sum of Rs. 11,000/. Pw1 also stated in cross examination that defendant
had authorised him to recover the rent from tenant Sh. A. Mitra which he
started recovering since 06.06.1973. He stated that all the rent was adjusted
against interest payable by the defendant. Pw1 stated that he has not paid
any rent of the premises to the defendant.
37. On third day of cross examination Pw1 stated that he has signed the
replication dated 3.3.1978 after duly understanding the contents thereof as
correct. After that a question was put to Pw1. This question is "did you get
any separate receipt for the sum of Rs. 5200/ allegedly paid by me to Ramesh
Chand Gupta as stated in para 2 at page 5 of replication?" Pw1 did not gave
reply to this question and submitted his own explanation.
38. Pw2 is Sh. Satish Chander Chhabra, Advocate. He came to prove the
notice Ext. P4. Pw4 stated that Ex.P4 was sent by him to the address
mentioned in the notice under the instruction of plaintiff/mortgagee. Pw2
also deposed that it was sent by post vide postal receipt Ex.P5. Pw2 further
deposed that he had filed a petition for ejectment on behalf of Smt. Kanta
Rani wife of plaintiff/mortgagee against the tenant Sh. A. Mitra and sub
tenant the defendant /mortgagor on the ground of non payment of rent and
subletting. In cross examination Pw2 admitted that plaintiff is related to him
and plaintiff has been his client in number of cases for last 15 years.
39. Pw3 Ramesh Chander Gupta came to depose that defendant has
mortgaged the suit property with him in 1967 or 1968 and a decree for
recovery was passed in his favour with cost. Pw3 deposed that defendant
paid entire decretal amount. Pw3 deposed that receipts Ex.Pw3/1 and
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 17
Ex.Pw3/2 are issued by him. Pw3 also stated that Ex.Pw3/2 is in his
handwriting. In cross examination Pw3 stated that defendant/mortgagor
can only sign in Hindi, he is otherwise not an illiterate person, so far as his
knowledge goes. Pw3 also stated that payment of decretal amount was made
by defendant personally.
40. Pw4 is Sh. A. Mitra (written as K. Mitra). Pw4 deposed that he was a
tenant of defendant on the first floor of suit property @ Rs. 155/ per
months. Pw1 stated that he received the letter MarkX1 from the defendant.
He identified the signatures of the defendant on Mark X1. Pw4 stated that
after receipt of letter Mark X1 he started paying rent of the premises to Smt.
Kanta Rani. Pw4 produced the rents receipts issued by Smt. Kanta Rani as
Ex.Pw4/1 and Ex.Pw4/2. Pw4 also stated that defendant/mortgagor did not
demand the rent for period which he paid to Smt. Kanta Rani.
41. In cross examination Pw4 stated that some times he used to pay rent
to plaintiff/mortgagee i.e. husband of Smt. Kanta Rani and sometimes to her
daughter. In later part Pw4 deposed that he has not received any summons
or notice of any eviction application, however stated that
plaintiff/mortgagee had filed one petition against him which was defended
by defendant and he gave power of attorney to Sh. Vijay Gupta Adv., on
advise of defendant. Pw4 stated that he had delivered the vacant possession
of the premises to the defendant and he had told that he would be
responsible for the consequences.
42. Pw5 is bank official Sh. Y.P. Goswami summoned to prove the
account of Smt. Kanta Rani. Pw5 produced the certified copy of accounts
Ex.Pw5/A for A/c No. 77/A/843135 dated 03.04.1979. Pw5 stated that the
account was renewed on 02.07.1982 and produced certified copy of renewed
account Ex.Pw5/B. Pw5 also produced correct copy of SB A/c No. 11938 of
Smt. Kanta Rani and placed on record as Ex.Pw5/C. Pw3 stated that on
03.04.1979 Smt. Kanta Rani was having Rs. 6,000/ in her account. The cross
examination of this witness is not material.
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 18
43. Pw6 was summoned to prove the mortgage deed Mark A1. Pw6 stated
that document Mark A1 is correct copy of mortgage deed. In cross
examination he admitted that document Mark D1 is also a correct copy of
mortgage deed registered on 08.06.1973.
44. Pw7 Sh. K.G. Supra, Advocate came to prove notice Ex.Pw7/1. He also
produced the original notice against which Ex.Pw7/1 was issued and also
produced postal receipts Ex.Pw7/2 and Ex.Pw7/3. In cross examination the
witness denied that these notices are forged.
45. Pw8 Sh. Joginder Pal Accountant produced summoned record from
Punjab National Bank Dev Nagar branch New Delhi. Pw8 produced the
account of M/S Rijesh Box and Carton Makers. This firm belongs to
Mahendfer Lal plaintiff/mortgagee. Pw8 deposed that plaintiff issued two
cheques Ex.Pw8/1 and Ex.Pw8/2 from his current account no. 139. Pw8
deposed those cheques were encashed and paid at counter after getting
signatures of drawee in front of clerk and other employees of bank. In cross
examination Pw8 stated that he is with the bank since 08.01.1984 and the
cheques Ex.pw8/1 and Ex.Pw8/2 were handed over by the manager. Pw8
stated that earlier the cheques were misplaced and traced out recently. Pw8
stated that he has no knowledge when the cheques were encashed neither
he can disclosed who was the counter clerk in whose presence the cheque
was encashed. Pw8 has no personal knowledge.
46. When Pw8 produced the cheques Ex.Pw8/1 and Ex.Pw8/2 Plaintiff
was recalled to formally prove these cheques in his evidence. On his recall
on 10.01.1986 Pw1 stated that he had issued the two cheques Ex.Pw8/1 and
Ex.Pw8/2 to defendant. Pw8 deposed that as there was an agreement for sale
of property, so month earlier he had issued these two cheques as advance
for the payment of sale consideration. Pw1 identified the signatures of
defendant on the back of Ex.Pw8/2. In cross examination Pw1 stated that he
do not maintain any accounts. Pw8 stated that he did not accompany
Kishan Lal for encashing the cheque in bank. Pw1 stated that in his previous
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 19
examination he had not stated that he is producing these 2 cheques. Pw8
further stated these these cheques were given bearer as the defandant had
told that he has no bank account. Pw1 denied the suggestion that no such
cheques were given and he has deposed false. Ex.Pw8/2 was put to witness
and he admitted that in the cheque the word self is cut and name of Kishan
Lal is written. But, volunteered that counterfoil Ex.Pw8/2A bears the
signature of defendant. Pw1 denied the suggestion that those two cheques
were in his custody.
47. In DE. First witness Dw1 was called from Tis Hazari Court in section
writing branch. Dw1 Sh. Puran Cahnd UDC brought the filing register dated
19.12.1974 and deposed that as per this record 19.12.1974 was a working
day. Dw1 was not cross examined.
48. Dw2 is the defendant/mortgagor himself. Dw2 deposed on oath that
plaintiff/mortgagee was his tenant in the suit property on entire ground
floor since 1969. Dw2 deposed that he had taken loan of Rs. 11,000/ from
plaintiff during tenancy. It is also deposed that plaintiff had let some of Rs.
6600/ during tenancy. Dw2 stated that the mortgage deed was for Rs.
25,000/ and apart from this amount he was liable to pay interest amount to
Rs. 2500/ to the plaintiff. Dw2 deposed that he received a sum Rs. 4,900/
before Sub Registrar and there was no rent deed at that time. Dw2 stated
that he was told that only mortgage deed is being executed. Dw2 deposed
that he is illiterate and he signs in Hindi only. Dw2 also deposed that initially
the rent was Rs. 110/p.m. later it was increased to Rs. 200/p.m. after
execution of mortgage. The rent was increased on account of installation of
furniture and repairs. Dw2 deposed that afterward he learnt that a rent note
had been got executed in favour of Smt. Kanta Rani. Dw2 stated that he
never executed any lease agreement in favour of Smt. Kanta Rani. Dw2 also
stated that interest on mortgage was 7.5%.
49. Dw2 also deposed that he did not paid any interest on mortgage as
that was to be adjusted against the rent. Dw2 also deposed that Sh.
Mohinder lal was also allowed to collect the rent from Sh. A. Mitra. Dw2
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 20
produced the statement of account of the rent received by
plaintiff/mortgagee from Sh. A. Mitra as Ex.Dw2/1 and Ex.Dw2/2. Dw2
further stated that he had not given written authority to collect rent from Sh.
A. Mitra but it was oral. Dw2 further deposed that he is entitled to adjust the
amount of Rs. 46,500/ towards the mortgage amount and he tried to remit
balance amount due to plaintiff and a notice was issued to plaintiff through
Mr. D. P. Jain Advocate. Carbon copy of notice was produced in evidence as
Ex.Dw2/3. Dw2 also stated that he received reply to his notice which was
produced in evidence as Ex.Dw2/4. Dw2 further stated that he is prepared to
redeem the mortgage and pay the entire amount which may come due.
50. Dw2 further deposed that Smt. Kanta Rani filed an eviction petition
against him on the ground of subletting of the premises, which was
dismissed. Certified copy of order was produced Ex.Dw2/5. He also deposed
that Smt. Kanta Rani preferred an appeal against the dismissal of petition
and the appeal was also dismissed. Certified copy of order of Ld. Appellate
Court was produced as Ex.Dw2/6.
51. Dw2 further stated that he never entered into agreement to sell the
suit property. He deposed that the document Mark X does not bear his
signature at point A. Dw2 further deposed that he did not receive any
amount of Rs. 3,000/ either by cheque or in cash. Dw2 also deposed that
suit of Mohinder Lal is false.
52. In cross examination Dw2 admitted that he had mortgaged the suit
property in favour of Sh. Ramesh Chand Gupta in 1968 for Rs. 20,000/. Dw2
stated that he got the mortgage redeemed by paying the mount in
installments. However witness did not answered when and by what amount
of installment. Dw2 denied the suggestion that the property was mortgaged
with Rsmesh Chander Gupta for Rs. 10,000/. Dw2 stated that he executed
pronotes of Rs. 11,000/ and Rs. 6,600/ for loan. Dw2 admitted that pronote
for Rs. 6,600/ was executed on 09.02.1970 and pronote of Rs. 11,000/ was
executed on 30.01.1969. Dw2 denied that he received cash loans of 1600 on
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 21
10.02.1970 and Rs. 600 on 25.05.1970. Dw2 also denied the receiving of sum
of Rs. 2200/. Dw2 admitted his signatures on pronote Ex.Dw2/P1 and
receipt Ex.Dw2/P2 dated 30.01.1969. He also admitted his signatures on
pronote and receipt Ex.Dw2/P3 and Ex.Dw2/P4 dated 09.02.70. Dw2
admitted that he appeared before Sub Registrar at the time of registration of
mortgage deed and admitted the signatures on mortgage deed. Dw2 denied
that he was identified by one Sh. Milkhi Ram and Sh. D.S. Lamba Advicate
before Sub Registrar.
53. A suggestion was put by counsel for plaintiff/mortgagee that before
Sub Registrar Dw2 acknowledged having previously received 10,000/ from
mortgagee and received Rs. 22000/ before Sub Registrar. The suggestion
was denied as incorrect. The suggestion was again put by reforming it that
Dw2 actually acknowledged having received 22,000 in advance and received
Rs. 10,000/ before Sub Registrar . Again the witness negated the suggestion
as incorrect and volunteered that he received Rs. 20,100/ and Rs. 4,900/
out side the Sub Registrar's office. Dw2 admitted that mortgage deed Ex.P1
was executed but stated that he do not know its contents as he is illiterate.
Dw2 denied that two chits were issued by SubRegistrar. He stated that he
learnt on that day that the mortgage deed has been registered. The mortgage
deed was put to the witness and asked about the amount written on it, but
Dw2 stated that he received only Rs. 25000/ not Rs. 32,000/. On the
suggestion that Dw2 never informed the SubRegistrar that he is not aware
of contents of mortgage deed, Dw2 replied that he did not complained as he
was not aware about the contents of mortgage deed. Dw2 stated that he
came to know about falsity of mortgage deed only when Mahinder
Lal/mortgagee filed suit for specific performance against him. Dw2 stated in
cross examination that he do not know if any other document was presented
for registration at the time of registration of mortgage deed Ex.P1. Dw2
admitted that mortgage deed was executed on 04.06.1973 and it was
presented for registration on 07.06.1973. Dw2 denied that on 06.06.1973 a
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 22
rent deed with respect to the whole property in favour of Smt. Kanta Devi in
the sum of Rs. 200. In later part of cross examination Dw2 admitted some
suggestions as correct. These are reproduced. "it is correct that the original
rent deed is in my possession. It is correct that the rent deed was on stamp
paper. It is correct that the rent deed was presented for registration before the
sub registrar also on 07.06.1973. But I had no knowledge." Dw2 stated further
that at the time of presentation of documents he was not told that one of the
document was a rent deed in favour of Smt. Kanta Rani for Rs. 200/ for
whole house. Dw2 admitted that Ex.Dw2/P5 is the copy of purported rent
note in favour of Smt. Kanta Rani and admitted his signatures at point A, B,
C & D.
54. In further cross examination on day 2, Dw2 stated that he had not
inquired from Sh. A. Mitra as to what amount he has paid to Sh. Mohinder
Lal. Dw2 stated that Sh. A. Mitra vacated first floor in 1977 and after that he
occupied that. After this a question was put to Dw2 that whether he took
permission from Sh. Mohinder Lal or Smt. Kanta Rani for occupying the first
floor and barsati floor. The witness answered that he is the owner and there
was no necessity for for taking permission from them.
55. Dw2 admitted that one Sh. Vijay Gupta was his advocate in
mortgagee's suit for specific performance. He also admitted that he used to
consult before admitting the document. Now a question was put on Ex.P2
and asked about the admission of Mr. Vijay Gupta to the defendant's
signature on this document. The witness answered that he do not know at
all if Mr. Vijay Gupta admitted the signature on 25.10.1978 on Ex.P2. Dw2
was confronted with his written statement at para 2 from point A to A where
it is written that prior to execution of mortgage deed dated 04.06.1973 Smt.
Kanta Rani took on rent the ground floor of the said house on rent of Rs. 200,
and the witness answered that this all is written by his counsel. Dw2 also
admitted that his Counsel D.P. Jain filed replication in redemption suit. He
was confronted with the replication where it is written that rent note has
been got executed by Sh. Mahinder Lal in favour of Smt. Kanta Rani at the
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 23
rate of Rs. 200/ p.m. only because Sh. Mahinder lal wanted increased
interest at the enhanced rate of Rs. 200/ p.m. and not the actual interest at
Rs. 156.25 p.m. When Dw2 was questioned as to his previous statement that
he had not executed any rent note in favour of Smt. Kanta Rani with
confronted statement witness stated that "I do not know anything whatever
the lawyer wanted they put down in the replication". Dw2 was further
confronted with the replication at Para 4 from A to A where the mortgagor
has stated that there is no relationship of landlord and tenant between me
and Smt. Kanta Rani. To this, witness admitted to be written but stated that
he do not know anything about rent deed dated 07.06.1973. The witness was
again confronted with para 3 of replication in redemption suit where he has
stated that rent note was got executed in favour of Smt. Kanta Rani along
with mortgage deed, and the witness replied that it is correctly recorded.
56. Dw2 admitted the suggestion to be correct that Smt. Kanta Rani did
not pay rent to him. However he state that he do not know Kanta Rani and
state that Mahinder Lal is his tenant. Dw2 further stated in cross
examination that Mahinder Lal did not pay any rent as the rent was adjusted
against the mortgage amount. Counsel for plaintiff put a suggection that
after the execution of rent note in favour of Smt. Kanta Rani Mohinder lal
did not remain tenant on the ground floor. This suggestion was denied and
the witness volunteered that Sh. Mahinder lal is his tenant. On cross
examination as to increase of rent from Rs.110/ to Rs.200/ on account of
repairs, Dw2 explained the nature of repairs but admitted that he had not
stated about those in earlier statement. On suggestion Dw2 denied that rent
was not increased on account of the repairs.
57. Dw2 was then questioned on the notice of redemption Ex.Dw2/3 and
asked to explain the non mention of repair in that notice while execution of
rent note in favour of Smt. Kanta Rani. To this, witness answered "whatever
the lawyer wrote is correct otherwise I do not know". To similar question
regarding the mortgage amount of Rs. 32000/ Dw2 gave same reply.
58. To the suggestion of counsel for defendant regarding execution of
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 24
agreement to sale on 19.01.1974 in favour of Sh. Mohinder Lal for sale of suit
property Dw2 flatly denied. Dw2 also denied that it contains his signature at
point A. Here again the witness said that he do not know Hindi and stated
that he can only sign in Hindi. Dw2 denied that endorsement in Hindi at
point mark Y acknowledging the receipt of Rs. 10,000/ is in his
handwriting. Further the witness stated that he cannot read the
endorsement in rent note which is in Hindi and reads 'ASAL KIRAYANAMA
VASOOL PAYA'. (if a witness cannot read, the words recorded in capital
letters are the word put in cross examination). Dw2 stated that he has no
document to show that he received 4,900 before SubRegistrar. The witness
stated that no amount was received before SubRegistrar. The amount was
outside the office of SubRegistrar. In later part witness stated that he
received the amount of Rs. 20,100/ in installments but failed to explain how
many and of what amount. Dw2 admitted that Sh. Ramesh Chander had got
a decree against him on account of mortgage of suit property. Dw2 denied
the suggestions that Sh. Ramesh Chander was putting pressure for payment
of money and for this purpose the property was agreed to be mortgaged for
Rs. 32,000/. An agreement dated 10.02.70 was put to Dw2 as Ex.Dw2/P7 to
which Dw2 admitted to having his signatures and thumb impression, but
stated that he do not know the contents. Dw2 stated that he do not have any
bank account. He also stated he do not have amount with him but stated
that he will arrange for the same once he come to know how much amount
is due (29.09.99). Counsel for mortgagee/plaintiff also put some documents
in cross examination as Ex.Dw2/P8 and Ex.Dw2/P9. Lastly counsel for
mortgagee gave suggestion that "your statement that the interest amount ,on
the mortgage and the rent due to you were to be adjusted is false? This was
denied as incorrect.
58. Dw3 was called to produce some record but he did not produce the
record. Dw4 was summoned again for same record. Dw4 stated that he has
not brought the summoned record in respect of grant of licence of stamp
vendor in the name of Sh. Hukum Chand Suri stamp vendor as it was not
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 25
traceable.
59. Since the defendant/mortgagor has denied his signatures in
document Mark X plaintiff appointed handwriting expert to prove that
signature is of Kishan Lal, at the time of PE. The expert of plaintiff was
examined as Pw9. Pw9 filed its report as Ex.Pw9/1 with enlarged
photographs Ex.Pw9/2 to Ex.Pw9/11 and their negatives Ex.Pw9/13
collectively. Pw9 deposed that after examination of disputed signatures Q1
to Q15 and comparing the same with admitted signatures of Kishan Lal A1
to A9 taken from file, in his considered opinion the disputed signatures
written as 'Kishan Lal' in Hindi are written by Kishan Lal the writer of of the
comparative admitted signatures.
60. In cross examination report was questioned by counsel for
defendant/mortgagor and the expert admitted that the date of examination
of the signatures is not mentioned in the report. Some cross examination as
to formation of words were put which the expert properly replied.
61. Defendant/mortgagor also appointed his hand writing expert in
rebuttal and filed the report but that report could not be put in evidence as
defendant's expert refused to appear and depose, despite various summons.
Thereafter on 05.03.2001 DE was closed and matter was adjourned for final
arguments. Defendant moved an application for appointment of another
expert but the application was dismissed along with an application under
order 47 filed by defendant/mortgagor. The matter thereafter remained
pending for final arguments.
62. I have heard the arguments addressed by counsel for mortgagee Sh. S.
P. Jha and for mortgagor Sh. S. K. Bhaduri, at length and carefully gone
through evidences and record. On the basis of arguments addressed by Ld.
Counsels and the record available my finding on each issue in both suits is
as follows;
63. In suit for specific performance filed by mortgagee.
ISSUE No. 1. Whether the defendant entered into the agreement to
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 26
sell dated 19th December, 1974, with the plaintiff with respect to suit
property? If so, what are its terms? This is the most crucial issue between
parties. Claim of mortgagee/plaintiff is that the mortgagor executed
document Mark.X. As per mortgagee this document is the agreement to sell.
At initial stage this document was challenged for deficient stamp and the
Court impounded it and after adjudication the deficient stamp duty was
paid with penalty on 12.07.1982. After adjudication as to stamp and
payment of deficient stamp with penalty the bar of section 35 of Indian
Stamp Act was removed. However the defence of defendant to this
document is of it s execution. It is the defence that defendant/mortgagor
never agreed to sell the suit property and never signed on Mark X.
Document Mark X is a handwritten document on a plain paper. Its contents
in verbatim are reproduced hereunder;
64. It is recipt extuited at Delhi own 19/12/74 By Kishan Lal S/o Sanwaliya
Res./ of House No. 5846 ....... Block No.4 Dev Nagar Karol Bagh New Delhi.
whereas I am owner and in propertiry position of two and Half Story Pakka
Built House No. 5846 Gali 6 Block 4 Ward 16 Built on lees Hold Plot arya 77
square yard.
The Above House is all ready Mortgages for the Sum of Rupees 33,200 in
favour of shri Mohinder Lal So/of Shre Azari Lal rest of House No. 5846 Gali 6
Block 4 and the After the Above Morgase it is fre from all sarlt of Moragges
and dispitues. I have with my free consant and will agreed to sale the Above
House along with lees hold rights of the Plot under needh a.... with electic and
watr fittings conession in favour of Mohinder Lal [morgegee mansion above
for the sum of Rupee 80,000 Eighty thounds and out of the prize agreed I have
received the sum of Rupees of then thousands in case by way of Aru....d Money
and further earnest money of Rupees ten Thousands will be paid to me by the
purchaser upto ............ (blank) and rugular aggree ment for sale will Be
Executed by me in the foayo..r of the Purchaser up to six month and I will
hand over entire vacant possition of the House two the purchaser and all the
costs the stams duty and register charges will by Paid by the Purchaser
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 27
himself and taxis and othr money will be paid by me.
DAS HAZAAR RUPAY BARA VA NAKAD SULAD Sd/ on
revanue stamp.
65. The above is the document Mark X in verbatim. This is the only
document mortgagee has produced to prove that there was an agreement to
sale the suit property. The objection of mortgagor is that the document is
forged and not signed by him at point A and the endorsement at point Y is
not in his writing. The onus to prove that mortgagor agreed to sale the suit
property is on mortgagee. To the first objection that the document is not
signed it is submitted by Ld. Counsel for mortgagee Sh. S. P. Jha that
mortgagee has fairly proved that document Mark X is signed by mortgagor.
It is submitted that mortgagee has identified the signature of mortgagee in
Mark X and the handwriting expert Pw9's testimony in this regard is
sufficient to negate the defence of mortgagor. It is also submitted that when
mortgagee produced his expert evidence, mortgagor failed to negate the
opinion given by Pw9. Therefore, since the document Mark X is proved to be
signed by mortgagor and since after this proof the defence that it was not
signed by mortgagor goes, it is proved that mortgagor agreed to sell the suit
property to mortgagee.
66. On the other hand counsel for mortgagor Sh. S.K. Bhaduri submitted
that the document Mark X is neither signed by mortgagor nor it is an
agreement to sell. Ld. Counsel submitted that the document Mark X is not
an agreement to sell as it is not signed by the second party. Ld. Counsel also
contended that mortgagor is an illiterate man and he could only write his
signature in Hindi. It is submitted that although mortgagor never signed in
the document but even if the signature in Mark X at point A is of mortgagor,
it is a fabricated document. It is also contended that the writings in Hindi "
DAS HAZAAR RUPAY BARA VA NAKAD SULAD" is not of mortgagor. Ld
Counsel further submitted that in evidence Pw1 deposed that Mark X was
written by Sh. Dina Nath but he was not produced to prove the document.
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 28
Ld. Counsel referred to cross examination of Pw1 where he has stated that
19.12.1974, when the document Mark X was executed, was holiday and
submitted that this claim of Pw1 is false as Dw1 has proved that 19.12.1974
was working day. It is submitted that as per Pw1/plaintiff/mortgagee this
Mark X was executed on plain paper and not on stamp paper for only reason
that 19.12.1974 was holiday, but this testimony is false as 19.12.1974 was not
holiday and the work in Tis Hazari was going on that day. It is submitted
that this testimony itself clearly shows that Mark X is a false and fabricated
document.
67. Ld. Counsel for mortgagor further contended that that the document
Mark X read as whole itself says that it is not an agreement to sell but
agreement to execute an agreement to sell. While contending so, Ld.
Counsel referred to Mark X where it is written that "and further earnest
money of Rupee Ten Thousands will be paid to me by the purchaser
upto...........(blank)... and regular agreement for sale will be executed..". Ld.
Counsel submitted that the document itself is not a concluded agreement
therefore suit for specific performance is not maintainable.
68. In rebuttal Ld. Counsel for mortgagee submitted that once mortgagor
took the defence that his signature in Mark X are forged he cannot take the
plea of fabrication and he can not comment on the contents of documents.
It is submitted that if the defence of mortgagor is that he has not signed on
Mark X then he can not take altogether inconsistent plea that mark X is not
an agreement to sell or it is fabricated.
69. The rebuttal argument of counsel for mortgagee is not tenable. In any
suit defendant has right to take as many grounds of defence available with
him. Although the defence should not not be inconsistent so as to defeat
other defence, but in the present case as the mortgagor has consistently
stated that he is an illiterate and he could sign only in Hindi, the defence of
forgery along with fabrication cannot be taken as inconsistent. Reason
being, if a person is illiterate and is questioned with a document which may
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 29
contain his signature, but, had never in his mind for what he has signed, or
he signs for some different purpose than what document contains, he would
always reply that he has not signed such document. Specially in a case like
this where there are various documents between the parties. So in this
particular case where there is no proof against the claim of mortgagor that
he is illiterate specially for English language, the defence of fabrication is not
inconsistent with forgery.
70. The mortgagee is claiming specific performance of contract and for
that mortgagee has to prove that Mark X is a valid contract. Defendant has
every right to question the document in every aspect, on which plaintiff
bases his claim. Further as per section 9 of the Specific Relief Act , "except as
otherwise provided in the Act where any relief is claimed under chapter II of
the Act in respect of a contract, the person against whom the relief is claimed
may plead by way of defence any ground which is available to him under any
law relating to contracts". As relied by Ld. Counsel for mortgagor, in JT 1990
(3) SC 205 in Smt. Mayawati v. Smt. Kaushalya Devi it was held that "In a
case of specific performance it is settled law, and indeed it cannot be doubted,
that the jurisdiction to order specific performance of a contract is based on
the existence of a valid and enforceable contract. The law of contract is based
on ideal of freedom of contract and it provides the limiting principles within
which the parties are free to make their own contracts. Where a valid and
enforceable contract has not been made, the Court will not make a contract
for them. Specific performance will not be ordered if the contract itself suffers
from some defect which makes the contract invalid or unenforceable. The
discretion of the Court will be there even though the contract is otherwise
valid and enforceable and it can pass a decree of specific performance even
before there has been any breach of the contract. It is, therefore, necessary first
to see whether there has been a valid and enforceable contract and then to see
the nature and obligation arising out of it. The contract being foundation of
the obligation the order of specific performance is to enforce that obligation.
(emphasis supplied)
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 30
71. The first point of argument is that whether this document Mark X is a
contract/agreement to sell or not. The point of difference between Ld.
Counsels is that Document Mark X is a receipt only and not the agreement.
Further it is agreement to agreement in future. Ld. Counsel for the
mortgagee submitted that if a receipt contains all the ingredients of
agreement to sell it is a valid agreement to sell. In this regard Ld. Counsel
placed reliance on 182 (2011) Delhi Law Times 350 Braham Singh Versus
Sumitra & Ors, 63 (1996) DLT 52 M/s Agarwal Hotels Pvt. Ltd/ v. Focus
Properties Pvt. Ltd., 2009 (1) SLT 164 Alka Bose v. Parmatma Devi & Anr,
2002 Vii AD (Delhi) 164 N. K. Widhani &Ors v. Ajit Prasad Jain and Judgment
of Hon'ble High Court of Delhi passed on 24.05.05 in CS(OS) No. 256/1990
in Re: S.K. Gupta (through Lrs) v. Avtar Singh Bedi & Ors. The basis of
reliance is that "the four ingredients necessary to make an agreement to sell
are: (I) Particulars of consideration; (ii) certainty as to parties i.e. vendor and
the vendee; (iii) certainty as to property to be sold; and (iv) certainty as to
other terms relating to other terms relating to probable cost of conveyance to
be born by the parties, time etc". (Emphasis supplied)
72. It is in the light of above test Ld. Counsel for mortgagee submitted
that document Mark X, though written in form of receipt, is an agreement to
sell. Ld. Counsel submitted that Mark X contains the name of seller and
purchaser as Kishan Lal and Mohinder Lal respectively, the property is
identified as House no. 5846 Block 4 Gali No.6 Dev Nagar Karol Bagh New
Delhi, the consideration is certain for Rs. 80,000/ and contains the advance
payment of Rs. 10,000/, the time frame of six month is also given and it is
also written who has to bear the charges of registration and stamps and who
has to take permissions and clearance. It is submitted that the Mark X
qualifies the test to be an agreement to sell therefore it is a valid agreement
to sell. Further in 2009 (I) SLT 164 there was a specific issue before the Trial
Court that "whether an agreement of sale executed only by the vendor, and
not by purchaser is valid". To this issue it was held by Hon'ble Supreme
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 31
Court that "even an oral agreement to sell is valid. If so, a written agreement
signed by one of the parties, if it evidences such an oral agreement will also
be valid. xxxxxxxxx. In india an agreement of sale signed by the vendor
alone and delivered to the purchaser, and accepted by the purchaser, has
always been considered to be a valid contract. In the event of breach by the
vendor it can be specifically enforced.
73. Ld. Counsel for mortgagor on the other hand placed reliance on AIR
1998 Calcutta 44 Punit Beriwala v. Suva Sanyal & Anr, where it was held
that "A mere agreement to agree is not enforceable in a Court of Law.
Furthermore, it is a trite law, that in order to enforce an agreement, the same
must constitute a contract within the meaning of section 2(g) of Indian
Contract Act. It must also be a lawful one having a lawful consideration
therefor and entered into with a lawful object." (Emphasis supplied).
74. Ld. Counsel further placed reliance on AIR 2003 Delhi 15 Ms.
Mirahul Enterprises and Others v. Vijaya Shrivastava where it was held that
"in exercising discretion, the court is obliged to take into consideration
circumstances of the case , conduct of the parties and the respective interest
under the contract. At the same time, it should not be lost sight of that the
discretion has to be exercised by the court not arbitrarily but based on sound
judicial principles. The first fundamental which must be proved beyond all
reasonable doubts is the existence of a valid and enforceable contract".
(emphasis supplied).
75. The point of contention was whether the receipt can be treated as
agreement to sell which does not bear signature of vendee. As contended by
Ld. Counsel for mortgagee the document Mark X is having name of parties,
it is also having the description of property, it also contains the
consideration and the terms of performance of particular acts. Further as
held by Hon'ble Supreme Court in 2009 (I) SLT 164 it is not required to be
signed by the purchaser. Hence, a receipt could be an agreement to sell if
contained all above requirements, but it must be a concluded agreement
between the parties having mutuality.
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 32
76. Second point of argument is to the validity of agreement. The one and
consistent defence of defendant was that he is an illiterate and he could only
sign in Hindi. It is not in dispute here that mortgagor was indebted to
mortgagee. The claim of mortgagee is that on 19.12.1974 mortgagor took Rs.
10,000/ as earnest money and executed Mark X. Mortgagee himself claims
that after execution of Mark X, for payment of remaining amount of Rs.
10,000/ of earnest money he paid Rs. 3000/ in cash and paid cheque of Rs.
3000 dated 21.01.1975, which the mortgagor returned for cash payment of
Rs. 3000/. It is also claimed by mortgagee that remaining amount of Rs.
4000/ was not received as mortgagor stated that he would take it against
pakki receipt at the time of registration of sale deed. However at the same
time it is the mortgagee who deposed against his own claim. As per Pw1 in
cross examination the day when Mark X was executed i.e. 19.12.1974, it was
a holiday. It is stated by mortgagee that mortgagor had told him that he
would execute the agreement on stamp paper on next day. This proves that
on 19.12.1974 the agreement to sell was not concluded as it was a draft one.
But the testimony of Pw1 is false. Claim of Pw1 is that 19.12.1974 was
holiday. This is the reason assigned by Pw1 for making the agreement in a
plain paper. Defendant/ mortgagor has proved the falsity of Pw1 when Dw1
came and deposed that 19.12.1974 was working day and work was going on
in filing counter.
77. Further Pw1 has deposed that defendant had told to execute proper
agreement on next date and he purchased stamp paper on next date and
asked the defendant to execute the same, however the defendant declined to
execute the agreement. Now if, as per mortgagee he purchased the stamp
papers on next date and asked the mortgagor to execute the agreement then
the next date is 20.12.1974. Therefore as per mortgagee,
defendant/mortgagor declined to execute the agreement on 20.12.1974. If it
is so, then where was the occasion for the mortgagee to pay Rs. 3000/ in
cash and cheque of Rs. 3000/ in the month of January 1975. How could
mortgagee pay sum of Rs. 3000/ on 21.01.1975 in return of cheque, issued
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 33
earlier, if mortgagor refused to execute proper agreement on 20.12.1974.
Mortgagee is an educated man and he is presumed to be reasonably
prudent. Mark X is not the only transaction between mortgagee and
mortgagor. It is not the only document between mortgagor and mortgagee.
All other documents executed between mortgagee and mortgagor are
properly drafted and most of them are registered.
78. As recorded in verbatim above, Mark X itself shows that it is not
written by any expert. It is written so badly that one cannot even read it at
first look. The mortgagor is not a literate man and he could only sign in
Hindi, still this unexpert has written this document in English when the
writer himself is not good in English. What prevented the scriber to write
this document in Hindi. What was the reason that it is written in English
when the writer was not so good in English? If an effort is put to find the
answer to this question keeping in mind that this document has to used
against an illiterate person, answer will become obvious i.e. to take
advantage of his illiteracy.
79. As already discussed above that the plea of forgery would not become
inconsistent with plea of fabrication in this particular case, as, unless the
person signing the document knows the contents of document, he would
always say he did not signed a particular document, when the contents of
documents are put to him. A person does not become liable if signature
does not match his intention. Therefore, as mortgagee produced expert
opinion the that Mark X at point A is signed by the mortgagor after
scientifically examining and, as I do not find any flaw with the opinion of
expert after looking at the other admitted signatures of mortgagor, the
document document Mark X, though signed by mortgagor, would bind
mortgagor only if the mortgagor was aware about the contents of
documents and if the agreement was concluded. Though, the mortgagor
also filed an expert report but same was not taken in evidence as the expert
R. P. Singh, who gave his opinion in favour of mortgagor, refused to appear
in witness box despite various summons. The opportunity of mortgagor was
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 34
closed for late filing of process fee for issuing notice under order 16 rule 12.
80. The issue here is whether defendant entered into the agreement of
sale dated 19.12.1974. Except for Mark X, to prove the agreement,
mortgagee has not produced anything on record. The writer of Mark X was
also not called in witness box. Although mortgagee has produced various
receipts and cheques viz. Ex.P2A, Ex.P3 and Ex.Pw8/1 and Ex.Pw8/2. Ex.P2A
and Ex.P3 are produced to show that mortgagor paid the remaining amount
of 6000/ out of 10,000 as further earnest money, but as recorded earlier, if
as per Pw1 the mortgagor refused to execute proper agreement on next date
execution of Mark X, there was no occasion to pay the further earnest
money against these receipts. Similarly Ex.P3 could not be said to be given in
consideration of agreement to sale as it is alleged to be given on 21.01.1975.
Surprisingly Pw2 in his later part of cross examination retracted from his
earlier statement and went on deposing that he never stated that the
defendant refused to execute the regular agreement on the next day of the
execution of the document Mark X. It is nothing but a useless attempt to
cover up the falsity.
81. So far as payment by way of cheques Ex.Pw8/1 and Ex.Pw8/2 are
concerned at the outset these cannot be said to be given in consideration of
alleged agreement to sell as Pw1 when recalled to prove them formally,
stated that he had issued those cheques prior to execution of Mark. X. This
fact was never pleaded by mortgagee in his plaint or replication. Further the
ground on which mortgagee filed the suit is that at the time of execution of
Mark X mortgagor was given Rs. ten thousands as earnest money. This is
what is pleaded and this is what written in Mark X. There is a stress from the
side of mortgagee that after receiving Rs. 10,000/ mortgagor wrote at point
mark Y endorsing the receipt of Rs. 10,000/. At point Y writing is in Hindi "
DAS HAZAAR RUPAY BARA VA NAKAD SULAD". To this
defendant/mortgagor has specifically denied. The consistence defence of
mortgagor is that he could not write any thing except his signature in Hindi
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 35
and it is the defence that this endorsement is not written by mortgagor.
There is not examination by expert as to whether the sentence in Hindi at
point Y is written by mortgagor or not. Of course, being illiterate mortgagor
could not give any sample handwriting. But there is no attempt from the
side of mortgagee to show that mortgagor could write in Hindi. There is only
one statement of Sh. Ramesh Chander Pw3, where he said that "he is
otherwise not an illiterate person, so far as my knowledge goes". This
testimony could have helped the mortgagee had mortgagee had produced
any evidence to show that mortgagor is capable of writing. However,
mortgagee's own testimony goes against the claim that Rs. 10,000/ was
received by mortgagor and he made endorsement at point Y in Mark X. The
mortgagee has stated for the first time in examination in chief that "I paid
Rs. 1500/ to the defendant about one month prior to the execution of the
agreement, Rs. 8500/ at the time of execution of the agreement mark X". This
version has come for the first time in evidence otherwise neither it is written
in Mark X nor it is written in plaint or replication. Therefore, if in fact the
writing in Hindi at Point Y in Mark X were of mortgagor or if the mortgagor
was not illiterate and wrote those word in his writing, and if mortgagor was
paid Rs. 8500/, then in no circumstances he could have made a plain
endorsement/receipt of Rs. 10,000/.
82. Therefore from all aspects the document Mark X could not be
considered as agreement to sell. It is not concluded as proper agreement
was yet to be prepared and it does not reflect the mutuality and the
intention of mortgagor that he agreed to sell the suit property. The
testimony of mortgagee, specifically, that Mark X was so executed, as
19.12.1974 was holiday is nothing but a lie, proved by
defendant/mortgagor's witness. 19.12.1974 was Thursday. Dw1 has proved
that it was a working day by looking into filing register at date 19.12.1974.
This cannot be equated with lapse of memory. If witness had answered
regarding any random date, witness could have been given benefit of doubt
of lapse of memory. But this witness has stated that 19.12.1974 was holiday
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 36
therefore he did not purchased stamp paper and further said that he
purchased stamp paper on next day when mortgagor refused to execute.
The witness has explained the day in connection to his working in a
particular manner, taking the ground of holiday as reason for not executing
the agreement on stamp paper. The memory as to day may fade due to
lapse of time but the reason cannot change by that lapse. Therefore from
every aspect plaintiff/mortgagee failed to prove that defendant/mortgagor
entered into agreement to sale dated 19.12.1974 with plaintiff with respect to
the suit property. "It is a settled law that if a contract is to be made, the
intention of offeree to accept the offer must be expressed without leaving
room for doubts as to the fact of acceptance with those of the offer. The rule is
that the acceptance must be absolute, and must correspond with the terms of
the offer. If the two minds were not ad idem in respect of the property to be
sold there cannot be said to have been a contract for specific performance." JT
1990 (3) SC 205 supra. The issue is accordingly decided against plaintiff.
83. The major and vital issue for determination of claim of
plaintiff/mortgagee has gone against him. The suit of plaintiff fails on this
ground alone. However, there are other issues involved, which though not
necessary now, must have to be decided to finally dispose the matter. For
determination of next issues, it is necessary to go with a hypothetical
presumption that plaintiff/mortgagor proved issue no.1 in his favour.
84. ISSUE No.2. How much amount has been paid by plaintiff towards
agreement of sale. For determination of this issue if it is presumed that issue
no. 1 has been decided in favour of plaintiff, as per Mark X, mortgagor has
already mortgaged the suit property with mortgagee for Rs. 33,200/.
However the registered mortgage deed Ex.P1 is for Rs. 32,000/. As per Mark
X the mortgage amount has to be adjusted in the consideration of sale of suit
property. Plaintiff/mortgagor has produced receipt Ex.P2A and Ex.P3. The
defendant/mortgagor had denied his signatures on Ex.P2A and Ex.P3 but
the expert opinion says that that these are signatures of mortgagor. I do not
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 37
find any ground to dispute the opinion as there is no other report to
disagree. The signatures in these receipts appear to be of mortgagor. As
already discussed there is little to dispute that mortgagor had various
dealings with mortgagee. But for the fact that issue no. 1 has gone against
mortgagee and doubt has already come upon transactions purported to be
claimed for agreement to sell, for the inconsistent testimony, these cannot
be held to be given in agreement to sale. Further in examination in chief Pw1
says that "I paid Rs. 11,000/ in one installment, Rs. 1600/ in another
installment, Rs. 6600/ in another, Rs. 600/, Rs. 220/ and Rs. 10,000/. Rs.
2200/ was paid as interest and Rs. 10,000/ was paid before Sub Registrar.
The entire amount of Rs. 32,000/ was paid before the defendant executed the
mortgage Ext.P1". However, if all these amount is clubbed it comes to Rs.
42220. At one hand plaintiff is saying that he received 32,000/ in total at
other point his statement is going to Rs. 42220. The testimony of Pw1 is
totally inconsistent. In later part of cross examination various attempts are
taken by Pw1 to explain his accounting but could not help the mortgagee.
85. Admittedly the mortgagor received Rs. 11,000/ for the first time when
mortgagee was taken as tenant and mutually agreed that interest at 1% p.m.
will be adjusted against monthly rent of Rs. 110/. Thereafter, the mortgagor
admittedly received Rs. 6,600 against pronote dated 09.02.1970. By this
amount comes only for Rs. 17,600/. However, admittedly there is a
mortgage between parties and this mortgage is for Rs. 32,000/, though
mortgagor claims that he received only Rs. 25,000/. So if there was an
agreement between mortgagee and the mortgagor to sell the suit property
and if earnest money of Rs. 10,000/ would have been received by
mortgagor, and mortgagor had breached the agreement on next date of
execution of Mark X, mortgagor would have received only Rs. 10,000/ and
mortgagee would have been entitled to adjust mortgage money in sale
consideration. The amount claimed to be paid vide Ex.P2A and Ex.P3 could
not be considered as there was no occasion and reason for mortgagee to
pay this amount once the mortgagor has committed breach on 20.12.1974
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 38
i.e. after execution of document Mark X dated 19.12.1974. However, as the
mortgagee never agreed to sell, there is no question of payment for
agreement to sell.
86. ISSUE No.3. Whether the plaintiff has been ready and willing to
perform his part of contract? Keeping the hypothetical presumption that
there was agreement to sell the suit property, the plaintiff/mortgagor has
averred, as mandatory required, in his plaint that he has been ready and
willing to perform his part of contract. Ld. Counsel for mortgagee argued
that the mortgagor admits that mortgagee is wealthy man and is capable of
paying money. It is submitted by Ld. Counsel that the present suit is for
specific performance of agreement to sell an immovable property and in
case of immovable property time of performance is not relevant. Ld.
Counsel placed reliance on 2008 (4) SCC 464 Balasaheb Dayandeo (through
Lrs) & Ors. v. Appasaheb Dattatraya Pawar where Hon'ble Supreme Court
relied on Constitution Bench Judgment of Hon'ble Court at para 10 and held
that;
10. In Chand Rani V. Kamal Rani a Constitution Bench
of this Court has held that in the sale of immovable property,
time is not essence of the contract.
87. Ld. Counsel for the mortgagor on the other hand contended that
though there was no agreement to sell but even if there was an agreement to
sell the mortgagee was not ready and willing to perform his part of contract.
Ld. Counsel submitted that the alleged agreement Mark X was executed on
19.12.1974. It is submitted by Ld. Counsel that from 19.12.1974 till
22.04.1977, nearly about 2 and half year the mortgagee remained silent. He
never issued any notice nor asked the mortgagor to execute the sale deed. It
is also stated that since some clearances are required before selling the suit
property, the mortgagor never insisted for getting that clearance. Ld.
Counsel further submitted that during those period Urban Land (Ceiling
and regulation) Act came into force which prohibited the transfer of land
without prior permission in writing from the concerned authority, but the
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 39
mortgagee never asked the mortgagor for getting such clearance. Ld.
Counsel referred to cross examination where mortgagee/Pw1 stated that he
asked the mortgagor to execute the sale deed but never issued any notice
calling the mortgagor to get the necessary clearance and to execute sale
deed before notice dated 22.04.1977. It is submitted that the silence on the
part of mortgagee proves that there was no agreement to sell, and if any such
agreement was there the mortgagee was never ready and willing to perform
his part of contract. Ld. Counsel further submitted that plaintiff is not only
required to show that he is ready and willing to perform his part of contract
but he is also required to show that throughout he was ready and willing to
perform his part of contract. It is submitted that silence on the part of
plaintiff for about 2 and half years shows that he was not ready and willing
to perform his part of contract.
88. Ld. Counsel for mortgagee/plaintiff in rebuttal contended that
readiness and willingness has to be inferred from the capacity of plaintiff to
pay the money. It has to be seen that whether the plaintiff was having or had
made arrangements of the amount required to be paid in consideration. Ld.
Counsel further submitted that if there are certain clearances to be obtained
before execution of sale deed it is for the vendor to do so. Ld. Counsel for
plaintiff/mortgagee placed reliance on JT 2007 (5) SC 514 wherein it was
held that "If a vendor had agreed to sell the property which can be transferred
only with sanction of some government authority, the Court has jurisdiction
to order the vendor to apply to the authority within specified period. It was
also held that there is always an implied covenant on the part of vendor to do
all things necessary to effect transfer of the property regarding which he has
agreed to sell the same to the vendee". ( emphasis supplied)
89. Ld. Counsel further placed reliance on JT 2005 (8) SC 499, and
V(2000) SLT. 534
"Readiness and willingness to perform part of the contract
has to be in spirit and substance and not in letter/form. The
language in section 16 (c) of Act does not require any specific
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 40
phraseology but only averments that plaintiff has performed
or always been ready and willing to perform his part of
contract. Averment of readiness and willingness is not a
mathematical formula which should only be in specif words.
90. Ld. Counsel further placed reliance on AIR 1971 SC 234, AIR 1971 SC
978, Air 1981 SC 234, SCR 1954 360 AIR 1930 PC 287 1969 (3) SCC 120 and
1995 DRJ (34), in support of his claim as to readiness and willingness.
Substance of these authorities is similar to the authorities above recorded.
91. There is no dispute as to averment of plaintiff in the plaint as plaintiff
has perfectly averred that he has always been and is ready and willing to
perform his part of contract. The question under consideration came only
when it was submitted by counsel for defendant that there is a silence on the
part of plaintiff for about 2 and half year. In fact from the date of alleged
agreement till the date of notice, for more than two years, there was no
correspondence from the side of plaintiff requiring defendant/mortgagor to
execute the sale deed or to get necessary clearance.
92. Section 16 (c) of the Act provides a personal bar to the decree of
specific performance. It reads:
(c) who fails to aver and 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;
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 41
(ii) the plaintiff must aver performance of, or readiness and
willingness to perform, the contract according to its true
construction.
93. Therefore plaintiff has not only to plead but also to prove that he has
always been ready to perform his part of contract. The term 'always been
ready' means that the plaintiff must always be ready and willing from the
date of agreement till filing of suit. However in the present case as, if there
was an agreement it was for the mortgagor to get the necessary clearance for
sale and as it is not disputed that mortgagee was man of means, the
readiness and willingness of mortgagee cannot be denied only because there
is no document to show that mortgagee insisted to mortgagor to get the
clearance. However as in issue no. 1 it is decided that there was no
agreement to sale, the silence of the mortgagee also gives force that the
document Mark X was a secret document made without the knowledge of
mortgagor. Had mortgagee ever issued notice to mortgagor regarding the
document Mark X the dispute would have raised earlier. The issue is
therefore decided in favour of plaintiff/mortgagee only if there was a valid
agreement to sell.
94. ISSUE No.4. Whether defendant committed breach of contract. As
per finding of issue no.1 there is no valid agreement to sell. Defendant never
executed agreement to sell the suit property to plaintiff/mortgagee.
Therefore the question of breach does not arise.
95. ISSUE No. 5. Effect of non applying to income tax authority and the
authority under
Urban Land (Ceiling and Regulation) Act. As already discussed above and
judgments relied by Ld. Counsel for mortgagor, there is an implied covenant
that vendor should get the necessary permission from the concerned
authorities. Therefore non applying to income tax authorities will not non
suit plaintiff from grant of Specific performance. Further, section 27 of the
Urban Land (Ceiling & Regulation) Act was declared to be unconstitutional
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 42
by Hon'ble Supreme Court in AIR 1981 SC 234 in case of Bhim Singhji v.
Union of India. It was held that entire Act is valid except section 27(1).
Section 27 being severable, declared ultra vires and unconstitutional being
beyond the ambit and scope of the Act and violative of Art. 14 of The
Constitution. Therefore, had there been an agreement to sell it would have
made no difference if mortgagor had not applied to Income Tax Authority.
96. ISSUE No.6. Whether the suit has not been properly valued for the
purpose of jurisdiction? The issue was framed on preliminary objection no.
3. The preliminary objection of defendant/mortgagor is that in para 17(a) of
the plaint, the plaintiff prays for decree of specific performance and
according to the plaint specific performance has to be in respect to
agreement of sale for Rs. 80,000/. It is stated that plaintiff also claims the
decree of possession of the property in question but for that purpose plaint
is neither valued nor any court fee is paid.
97. The defendant/mortgagor has not pressed this issue in evidence.
Section 7 of Court Fee Act provides for computation of fee payable. As per
para (x) of section 7 the computation of court fee, in a suit for specific
performance of a contract of sale, would be according to the amount of
consideration. Therefore there is no question as to wrong valuation of suit
for this relief. However, the objection is that plaintiff has claimed the relief of
possession also but neither valued the suit for that purpose nor paid the
court fee.
98. Ld. Counsel for plaintiff/mortgagee, at this, submitted that in a suit
for specific performance contract of sale of immovable property the relief of
possession is always included, as the delivery of possession remains the part
of agreement. In this regard Ld. Counsel placed reliance on 78 (1999) DLT
295 wherein it was held by Hon'ble Delhi High Court that in a case where
possession of immovable property vested with vendor, even if no decree for
possession is sought, in suit for specific performance of contract court is
empowered to grant decree of possession of immovable property in favour
of plaintiff.
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 43
99. Therefore, as it was not necessary to plaintiff to seek relief of
possession separately, just because plaintiff has asked for possession, it will
not require him to separately value the suit for for the relief of possession.
Possession, being part of agreement, is the consequence of same cause of
action. Therefore as per plaint there is not defect in valuation clause in the
plaint. The issue is decided accordingly.
100. As this suit was filed in the year 1977, in the very beginning when Ld.
Counsels appeared to address the final arguments before me, Ld. Counsel
for plaintiff/mortgagee was asked to look at the provision of Section 20
Specific Relief Act. On this, substantial efforts were put by both the counsels
and two special hearings were given for hearing on section 20. Of course the
need to look into section 20 come only if there is an agreement to sell, and in
the present case the vital issue has gone against plaintiff/mortgagee.
However, as Ld. Counsels have addressed on this factor at length the
question is looked into taking a hypothetical presumption that whatever is
stated by plaintiff in the plaint is true.
101. Section 20 of Specific Relief Act speaks about the discretion as to
decreeing specific performance. It reads:
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
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
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 44
(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;
(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 1. 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 2. 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.
102. Ld. Counsel for plaintiff/mortgagee submitted that although this case
has an age of 34 years in trial court itself but since the time is not an essence
of contract, just because this case took so long would not mean that the
specific performance cannot be granted. Ld. Counsel further submitted that
though it is the discretion of court to decree specific performance and court
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 45
can refused to exercise the jurisdiction, but, the Court has to exercise the
discretion judicially on sound principles. It is submitted that plaintiff has
invested a huge amount to purchase the property in the year 1973. It is
submitted that almost half of sale consideration was paid to the
defendant/mortgagee. Ld. Counsel further stated that even if after these 34
years the sale consideration appears to be a meager sum that can be
compensated to the vendor by ordering to pay additional amount taking
into consideration the rise in price of suit property.
103. Ld. Counsel for mortgagee/plaintiff, in support of his contention
placed some authorities. He placed reliance on JT 2004 (6) SC 126 P.
D'Souza v. Shondrilo Naidu, (2002) 8 SCC 146 Nirmala Anand v. Advent
Corporation (P) Ltd. and (2007) 10 SCC 595 Vishva Nath Sharma v. Shyam
Shankar Goela & Anr.
104. In the case in hand if it is presumed for the purpose of deciding the
jurisdiction to exercise the discretion in favour of plaintiff, the case as
pleaded by plaintiff would be that he advanced a sum of Rs. 11,000/' for
monthly interest @ 1%, which was to be adjusted with the rent of Rs. 110 per
month. Thereafter on various occasions plaintiff advanced further money to
defendant for mortgage of suit property. As per this mortgage deed a total
sum of Rs. 32,000/ was given till 04.06.1973, including all the advances
made prior to that day. Since 1969 plaintiff resided (is still residing) in suit
property as tenant, but as per plaintiff on the day when property was
mortgaged the old tenancy was terminated and a new tenancy agreement
was created with Smt. Kanta Rani for a sum of Rs. 200/. Further, as per
plaintiff himself the rent of the tenancy premises to be paid by Smt. Kanta
Rani was to be adjusted against the interest of 7.5% per annum. Plaintiff
himself states that defendant/mortgagor gave whole property in tenancy to
Smt. Kanta Rani and allowed her to collect rent of Rs. 155/ from Sh. A.
Mitra. It is admitted position that till date plaintiff/mortgagee has not paid
any rent to defendant/mortgagor. The stand of mortgagee is that he is not
the tenant but Kanta Rani is the tenant so liability to pay rent is of Smt.
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 46
Kanta Rani, but that could not be claimed as there was agreement that Smt.
Kanta Rani would pay the rent to plaintiff in adjustment to interest on
mortgage.
105. Interest on 32,000/ @ 7.5% per annum comes to Rs. 2300. The
adjustable amount of of rent @ 200/ per month come to Rs. 2400/ per
annum. Therefore every year plaintiff was getting Rs. 100 more with interest.
Smt. Kant Rani is non other but wife of plaintiff. It is not the case that
plaintiff was not enjoying the residence in the tenanted premises. This
tenancy in favour of Smt. Kanta Rani was nothing but a device to create
distinction of parties to mortgage and lease. Otherwise the beneficiary under
both agreements is the plaintiff. It is interesting to note here that the plaintiff
to prove his readiness and willingness, has produced the bank account of
Smt. Kanta Rani to show that he had means to pay the balance
consideration for purchase of suit property. If at one place plaintiff and Smt.
Kanta Rani are to be treated as two difference persons, then plaintiff cannot
claim his readiness by producing the accounts of Smt. Kanta Rani. The
whole purpose of the rent deed in favour of Smt. Kanta Rani was to make
arrangement for adjusting the interest on mortgage against rent.
106. So far as adjustment of sum of Rs. 200/ in interest is concerned it is
acceptable as the interest for one year on mortgage comes to Rs. 2300/ and
the rent for one year comes to Rs. 2400/. But it is totally unconscionable
that defendant/mortgagor allowed Smt. Kanta Rani to collect rent from his
tenant on first floor, which was Rs. 155/ per month. Plaintgiff has claimed
that this amount was also to be adjusted in interest, but the claim is false. It
is mathematically not correct. If there was no reason for allowing Smt. Kanta
Rani to collect rent from Sh. A. Mitra then such an agreement of defendant
with Smt. Kanta Rani is void for the want of mutuality. There is no reciprocal
consideration in favour of defendant for that amount.
107. But it is admitted case that Smt. Kanta Rani was authorised to collect
the rent from Sh. A. Mitra and in fact received rent from him. Therefore by
necessary implication and on mathematical calculation, as claimed by
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 47
defendant this amount was to be adjusted against principal amount of
mortgage. Plaintiff has went on claiming that defendant/mortgagor has let
entire property to Smt. Kanta Rani for sum of Rs. 200/. The defendant
himself was residing in the suit property. It is on this claim, as it is proved on
record by producing certified copies of orders, Smt. Kanta Rani filed an
eviction petition against defendant/mortgagor on the ground of non
payment of rent and on the ground of subletting.
108. Therefore, if plaintiff's claim is taken as stated by him, then this
plaintiff has paid only Rs. 10,000/, (along with mortgage amount out of
which defendant had already paid some amount in adjustment of rent) in
agreement to sell, but remained in possession of suit property at entire
ground floor since 1969 without paying any rent till date. Price escalation of
the property, if a factor to be considered judicially, then price escalation has
also to be considered in respect to the possible rent of the property also,
which, it could have fetched differently in different different period. Keeping
in mind the base price of Rs. 110 in the year 1969.
109. The reliance of Ld. Counsel for plaintiff is JT (2004) SC 126 where it
was held by Hon'ble Supreme Court that "It is not a case where the
defendant did not foresee the hard ship. It is furthermore not a case that non
performance of the agreement would not cause any hard ship to the plaintiff.
The defendant was a land lord of the plaintiff. He accepted part payment
from the plaintiff from time to time without any demure any whatsoever. He
redeemed the mortgage only upon receipt of requisite payment of money 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 escalation in price,
respondent should be denied the benefit of the decree passed in her favour.
Explanation 1 appended to section 20 clearly stipulates that merely inadequacy of consideration, or 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 subsection (2) of section 20. (emphasis Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 48 supplied)
110. Further submission of Ld. Counsel for plaintiff is that to balance the equity court can pass an order for making further payment. (2002) 8 SCC 146 at para 6 "It is true that grant of decree of specific performance lies in the discretion of Court and it is also well settled that it is not always necessary to grant specific performance simply for the reason that it is legal to do so. It is further well settled that the Court in discretion can impose any reasonable condition including payment of additional amount by one party to the other while granting or refusing decree of specific performance. Whether the purchaser shall be directed to pay an additional amount to the seller or converse would depend upon the facts and circumstances of a case. Ordinarily, the plaintiff is not to be denied the relief of specific performance only one account of phenomenal increase of price during the pendency of litigation. That may be, in a given case, one of the consideration besides many other to be taken into consideration for refusing the decree of specific performance. As a general rule, it cannot be held that ordinarily the plaintiff cannot be allowed to have, for her alone,the entire benefit of phenomenal increase of the value of the property during the pendency of litigation. While balancing the equities, one of the consideration to be kept in view as to who is defaulting party. It is also to be born in mind whether a party is trying to take undue advantage over the other as also the hardship that may be caused to the defendant by directing specific performance. There may be other circumstances on which parties may not have any control. The totality of circumstances is required to be seen. (emphasis supplied).
111. Further reliance is placed on (2007) 10 SCC 595 where Hon'ble Supreme while upholding the decree of specific performance directed the decree holder to pay additional sum of Rs. 5,00,000/ to the defendant/appellant. (emphasis supplied).
112. Counsel for for mortgagor/defendant on the other hand submitted that, although there was no agreement to sale date 19.12.1974, but even if the story of plaintiff is taken as gospel truth, the conduct of plaintiff dis Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 49 entitles the plaintiff, a relief under equity. Ld. Counsel further submitted that this is not a case only of financial hardship due to escalation of price of suit property, but there are several other factors which goes in favour of defendant/mortgagor. Ld. Counsel submitted that the defendant/mortgagor is an illiterate person, the mortgagee has been residing in the suit property since 1969, he is still residing there but for this entire period of 34 years the mortgagee has not paid a single penny towards the rent. Ld. Counsel further submitted that even if in the year 1974 the rent of Rs. 200/ was to be adjusted towards interest on mortgage, but the rent is bound to rise and if a judicial notice of rise in price is taken the mortgagor had already paid the mortgage amount of Rs. 32,000/. Ld Counsel further submitted that mortgagee is not entitled to equitable relief as the conduct of mortgagee has never been fair and equitable. He submitted that at one place the rent in respect to the property in his possession was agreed to be adjusted towards the interest, but at the same time when his wife was authorised to collect rent from other tenant, for only reason to adjust it in principal amount, taking undue advantage, she filed eviction petition against her own landlord/mortgagor. Ld. Counsel also submitted that in this case if the mortgagor had agreed to sale the suit property on 19.12.1974 and he refused to prepare formal agreement on very next day then what was the reason for mortgagee for not taking any step for two and half years. Ld. Counsel also submitted that to seek equitable relief plaintiff must come with clean hands. It is submitted that if the testimony of plaintiff is reconciled with the facts pleaded in plaint it clearly shows that there are several facts which plaintiff had not pleaded but tried to bring at the time of evidence for the first time. Ld. Counsel further submitted that plaintiff has tried to retract from his testimony during cross examination. Further, the plaintiff's testimony as to payments made to the defendant/mortgagor, in very first para of his examination in chief, is not in consonance with what plaintiff has pleaded. It is submitted by counsel for defendant that it is proved on record that plaintiff has not come with clean hands in the court therefore plaintiff is not Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 50 entitled to equitable relief of specific performance.
113. In support of his contentions counsle for defendant/mortgagor placed reliance on AIR 1996 SC 2814 Lordu Mari david & Ors v. Louis Chinnaya Arogiaswamy & ors., (1999) 8 SCC 274 Mahabir Prasad Jain v. Ganga Singh, (2005) 11 SCC 454 Sahadeva Gramini (dead) By Lrs V. Perumal Gramini & Ors, AIR 2003 SC 2362 Manohar Lal @ Manohar Singh v. Maya, AIR 2003 AP 141 P. Purshottam Reddy and Anr. v. M/S Pratap Steels Ltd. and AIR 2002 Karnataka 416. (emphasis supplied)
114. In AIR 1996 SC 2814 it was held that "It is settled law that the party who seeks to avail the equitable jurisdiction of a court and ad specific performance being being equitable relief must come with clean hand. In other words the party who makes false allegations does not come with clean hands and is not entitled to the equitable relief".
115. In (2005) 11 SCC 454 Hon'ble Supreme Court upheld the findings that "There was no mutuality in the agreement inasmuch as there were no rights with corresponding duties between the parties and, therefore, the same was unenforceable in law; that the agreement was inequitable and gave unfair advantage to the appellant".
116. In AIR 2003 AP 141 it was held that "Section 20 of the Specific Relief Act 1963 preserves judicial discretion to Court as to decreeing specific performance. The Court is not bound to grant specific relief merely because it is lawfully to do so. It is true, the discretion conferred upon the courts is not arbitrary but is required to be exercised in a reasonable and sound manner guided by judicial principles. While exercising the discretion, the Court is required to meticulously consider all the facts and circumstances of the case. The Court take care to see it is not used as an instrument of oppression to have an unfair advantage to the plaintiff.
117. The facts of the case in hand are far away from the facts in the judgment relied by counsel for plaintiff. In JT 2004 (6) SC 126 P. D'Souza v. Shondrilo Naidu, as Ld. Counsel for plaintiff has put stress on this this Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 51 judgment, the facts were not similar to this case. Though the status of parties in that judgment is somewhat similar with the parties in this suit, but the nature of transaction between parties is totally different. Here the defendant is an illiterate person. The relation of plaintiff with defendant is such that it clearly shows that how plaintiff was able to get signatures of defendant anywhere he wanted. Plaintiff claims that his wife Smt. Kanta Rani has taken entire property form defendant on rent, and even filed eviction petition against defendant. Plaintiff has not paid even a single penny towards the rent of part of suit property which is under tenancy, where plaintiff resides. Although plaintiff claims that Smt. Kanta Rani is tenant through separate rent note, but this rent not in favour of Kanta rani is nothing but a device to adjust the interest on mortgage amount with rent payable from tenanted property. It is just a veil created to bring the difference of parties through separate document. Further as recorded in foregoing paragraphs that plaintiff has not only lied in the court but, has tried to retract from his statement which was recorded on oath. Further there is noticeable silence of 2 and half year. This silence has never been explained. This all justifies that had the defendant/mortgagor had entered into agreement to sell the suit property on 19.12.1974, for the reasons above recorded and for the fact that plaintiff is enjoying the possession of entire ground floor without paying any rent for last 34 years, under the equity, the relief of specific performance should not be granted.
118. The relief clause will be dealt with after the findings of the issues in the suit for redemption of mortgage. In redemption suit the issue no. 1 is, whether the plaintiff/mortgagor is entitled to redemption of mortgage? Right to redemption of mortgage is provided under section 60 of Trasnsfer of Property Act mortgagor can at any time redeem the mortgage. It reads;
60. Right of mortgagor to redeem. At any time after the principal money has become due, the mortgagor has a right, on payment or tender, at a proper time and place, of the mortgagemoney, to require the mortgagee (a) to deliver to the mortgagor the mortgage deed and all the documents relating to Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 52 the mortgaged property which are in possession or power of the mortgagee, xxxxxxxxxxx:
provided that the rights conferred by this section has not been extinguished by the act of parties or by decree of a Court.
119. Therefore mortgagor has every right to redeem the mortgaged property. There is an objection of mortgagee that mortgagor's suit cannot be decreed as there is a novation of contract between the parties on 19.12.1974 when mortgagor agreed to sell the suit property to mortgagee. This objection, after the finding of issues in the mortgagee's suit for specific performance, goes. Otherwise there is no bar upon mortgagor from redeeming the mortgage. The second point of argument put by Ld. Counsel for defendant is that, mortgagor for redeeming the mortgage, must know what amount is due to the mortgagee. Ld. Counsel for mortgagee referred to the cross examination of the mortgagor/Dw2 where he stated that he do not know how much amount is due to be paid to mortgagee. Therefore when mortgagor is not certain how much amount is due, he should not allowed to redeem the mortgage. This contention is again not tenable as the mortgagor issued notice to mortgagee to redeem the mortgage on 14.12.1981 and asked to acknowledge the amount as claimed by mortgagor. The calculation of amount to be paid in redemption may differ and that difference, mortgagee would have explained, but the right of mortgagor to redeem the property cannot be taken away except by decree of court or by the act of parties.
120. The mortgage deed Ex.P1 in this regard is itself clear. The mortgage was created for period of 5 years i.e. from 04.06.1973 to 04.06.1978. The limitation for redemption of mortgage as per Art. 61 of Limitation Act, 1963 is thirty years from the date when right to redeem or to recover possession accrues. Hence there is no bar either of law or by any act of parties for redemption of mortgage. Mortgagor/plaintiff is entitled to redemption of mortgage. The issue is therefore in favour of plaintiff/mortgagor.
121. ISSUE No.2 Amount to be paid under redemption.
Although this issue requires consideration after taking into all the Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 53 accounts of parties. But the facts in this case are so clear that no account is required for decision of this issue. Mortgagor claims that mortgage was actually for Rs. 25,000/ but the registered mortgage deed for Rs. 32000/. No cogent evidence is produced to show that there was any fraud played, neither plaintiff has filed this suit for declaring the mortgage null and void, on account of fraud or misrepresentation. Plaintiff has filed the suit for redemption of mortgage and the mortgage deed is of Rs. 32,000/.
122. From the pleadings as well as documents and the findings above recorded, it is clear that the mortgage was for Rs. 32000/ with interest @ 7.5% per annum. The interest on mortgage amount at 7.5% comes to Rs. 2300/ per year. There is a subsequent agreement between mortgagor and the wife of mortgagee Smt. Kanta Rani when tenancy was created in her favour for Rs. 200/. There is an admission of both the parties that the Smt. Kanta Rani was not to pay any amount to mortgagor and that amount was to be adjusted to against the interest of mortgage amount. Though the mortgagee claims difference in his status with that of Smt. Kanta Rani, but the tenancy in the name of Kanta Rani was nothing but a device to secure interest of mortgage, to be adjusted against rent payable to mortgagor. Here also mortgagor is paying Rs. 100/ more every year than actual interest of Rs. 2300/.
123. As the tenancy in the name of Smt. Kanta Rani was just a device to adjust the rent against interest on mortgage, there is another agreement with Smt. Kanta Rani, which mortgagor claims that it was with mortgagee, to collect the rent from Sh. A. Mitra tenant on the first floor. This agreement, as already discussed, was an agreement to adjust the amount in principal amount of mortgage. Smt. Kanta Rani has received rent from Sh. A. Mitra since July 1973 till Sh. A. Mitra remained in the tenanted premises. As per testimony of sh. A. Mitra Pw4 he remained in premises till 1977, month not mentioned. Therefore, Smt. Kanta Rani have received rent from Sh. A. Mitra, atleast till Dec. 1976. This amount of rent from Sh. A. Mitra comes to Rs. 11,005 ( @ Rs. 155/ for 41 months i.e. from Aug. 1973 to Dec. 1976).
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 54 However, in the plaint plaintiff has claimed adjustment of only Rs. 7740, on account of rent of Sh. A. Mitra. Therefore, mortgagor is also entitled to adjust this amount.
124. Further, as the amount of interest is Rs. 2300/ per annum and the mortgagee is adjusting Rs. 2400/ of rent, the mortgagor is also entitled to adjust the excess of Rs. 100 paid every year, which in this case comes to 3700 i.e Rs. 100 excess every year from 1974 till 2011. In all, mortgagor is entitled to adjust Rs. 11,440 (Rs. 7740 + 3700) from the mortgage amount. Thus as on date the mortgagor is liable to pay Rs. 32000/ minus Rs. 11,440 i.e. 20,560/.
RELIEF IN BOTH SUITS.
In view of the findings above recorded, the mortgagee's suit for specific performance deserves to be dismissed. The mortgagors suit deserves to be decreed for redemption on payment of Rs. 20,560/ in Court. Let a preliminary decree be drawn directing the mortgagor to pay into the court a sum of Rs. 20,560/ within 1 month from today.
Announced in the open Court VIKRAM
On 24.02.2012 CJ02 (North)/Delhi
24.02.2012
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 55
24.02.2012 Suit No. 185/06
Present: None.
Vide separate composite judgment of suit no. 385/06 and
113/06, suit no. 385/06 filed for specific performance of contract is dismissed and suit no. 113/06 for redemption is held to be decreed.
Let a preliminary decree U/o 34 R 7 CPC be drawn directing the mortgagor plaintiff to deposit a sum of Rs. 20,560/ in court within one month from today.
A separate decree sheet be prepared in suit no. 385/06 for its dismissal. Both the files shall be consigned to the Record Room after drawing final decree in suit of redemption of mortgage i.e. 113/06.
VIKRAM
CJ02 (North)/Delhi
24.02.2012
Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 56
24.02.2012 Suit No. 113/06
Present: None.
Vide separate composite judgment of suit no. 385/06 and
113/06, suit no. 385/06 filed for specific performance of contract is dismissed and suit no. 113/06 for redemption is held to be decreed.
Let a preliminary decree U/o 34 R 7 CPC be drawn directing the mortgagor plaintiff to deposit a sum of Rs. 20,560/ in court within one month from today.
A separate decree sheet be prepared in suit no. 385/06 for its dismissal. Both the files shall be consigned to the Record Room after drawing final decree in suit of redemption of mortgage i.e. 113/06.
Now to come up for filing of amount of mortgage in court on 24.03.2012.
VIKRAM CJ02 (North)/Delhi 24.02.2012 Suit No. 185/06 [CS (OS) 871/77] & Suit No. 113/06 (1/82) 57