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Smart Summary

Factual and Procedural Background

This is a revision by the plaintiffs against the order dated 23-12-1975 of the Additional District Judge, Adilabad, which refused to receive in evidence a document (a mortgage bond) filed by the plaintiffs during examination of a witness (P.W.1). The plaintiffs had filed a suit for recovery of possession based on title. They alleged that the predecessor in title, late Venkata Rao, borrowed Rs. 1,000 from the defendant in February 1957, and put the suit property into the defendant's possession by way of a 14-year usufructuary mortgage (with a mortgage bond). The 14-year period expired in January 1971, and the plaintiffs alleged the defendant remained in wrongful possession despite oral demands and a lawyer's notice dated 10-1-1972.

The defendant denied the debt and asserted that late Venkata Rao agreed to sell the property to him in about 1955 and that the defendant had been in possession since 1955, claiming to have perfected title by adverse possession. During trial, when P.W.1 was examined on 22-12-1975 the plaintiffs sought to exhibit the mortgage bond; the defendant objected on the ground that the document was unregistered and therefore inadmissible.

Legal Issues Presented

  1. Whether an unregistered usufructuary mortgage bond, required to be registered, is admissible in evidence for the limited/collateral purpose of proving the nature, date, and character of the defendant's possession in a suit for recovery of possession based on title.
  2. Whether the absence of the defendant's admission as to having been put in possession under the deed prevents the court from receiving the unregistered document in evidence for the collateral purpose described above.

Arguments of the Parties

Plaintiffs' Arguments

  • The mortgage bond was produced for the limited purpose of showing the nature of the defendant's possession (i.e., that he came into possession by virtue of the usufructuary mortgage executed in February 1957), not to enforce rights under the deed or for redemption.
  • The plaintiffs stated the suit was based on title and that rights under the deed would not be enforced; thus the document was purely to prove how the defendant came into possession.
  • The plaintiffs explained why the document was not earlier filed as a registered instrument (asserting no registered mortgage was executed and thus it could not be filed earlier), and maintained it should be receivable for collateral purposes under the proviso to Section 49 of the Registration Act.

Defendant's Arguments

  • Counsel objected to the reception of the mortgage bond in evidence because it was an unregistered document, and therefore inadmissible to affect immovable property or to be received as evidence of a transaction affecting such property.
  • The defendant denied the alleged loan and mortgage, and pleaded that he was put in possession pursuant to an agreement of sale in about 1955 and had perfected title by adverse possession; he contested the authenticity/effect of the mortgage transaction alleged by the plaintiffs.
  • The defendant relied on precedents and the proposition that an unregistered usufructuary mortgage bond could not be admitted in evidence to support exclusion of the document.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Amina Bi v. Khamrunnisa, AIR 1974 Mad 54 Admission of a document to show that a party (Fateema Bee) was landlady and tenants held under her (i.e., admissibility of document to show nature of possession). The lower court considered the decision but found it not applicable to the facts of the present case.
Kolathoor Variath v. P. C. Kumhahammad Haji, AIR 1974 SC 689 Holding that a plaintiff could not regain possession on the basis of an oral mortgage for want of registration, though recovery on the strength of title remained open. The lower court analogised this decision and held that the usufructuary mortgage deed now filed could not be admissible in evidence for want of registration.
Lachhmi Narain v. Kalyan, AIR 1960 Raj 1 Proposition that Section 49 of the Registration Act and Section 91 of the Evidence Act are not affected because an unregistered document can be used to show character and nature of possession if possession is transferred under such document. The lower court cited this authority but nonetheless concluded the document could not be admitted because the defendant did not admit possession under the deed; the revisional court relied on the principle to support admissibility for collateral purposes.
B. Narayanamma v. Ramaiah, (1975) 2 Andh Pra LJ 298 Held that an unregistered document required to be registered but not registered is admissible in evidence to prove the date and fact of entry into possession and to show the character of possession; admissible for collateral purpose though not to claim rights under it. The revisional court relied heavily on this decision, describing it as clinching the issue; it applied the principle that an unregistered document may be received to prove character and date of possession and is subject to proof.
Pedda, (1969) 1 ALT 375 : AIR 1969 Andh Pra 242 (fb) Used by the lower court as part of authorities supporting the proposition that an unregistered usufructuary mortgage bond could not be admitted in evidence. The lower court relied on this authority to justify exclusion of the document; the revisional court disagreed with that application in the present circumstances.
Gadiraju Sanyasi Raju v. Kamappadu, AIR 1960 Andh Pra 83 (fb) Relied on by the lower court for the proposition that an unregistered usufructuary mortgage bond could not be admitted. The lower court cited this case to support exclusion; the revisional court did not accept exclusion for collateral purpose where the plaintiff's object was to prove nature/date of possession.
Venkateswarlu v. Ranga Reddy, 1956 Andh LT 998 Relied on by the lower court in support of non-admission of unregistered usufructuary mortgage bond. Used by the lower court to justify refusal; revisional court overruled the lower court's refusal in the factual context of this suit.
Balakistiah G. v. B. Ranga Reddy, AIR 1960 Andh Pra 112 Relied on by the lower court for the proposition that an unregistered usufructuary mortgage bond could not be admitted in evidence. The lower court cited this authority; the revisional court held the lower court erred in excluding the document for the collateral purpose pleaded by the plaintiffs.

Court's Reasoning and Analysis

The revisional court proceeded by analyzing the lower court's reasons for excluding the document and applied statutory provisions and relevant decisions:

  1. The court noted that the lower court refused reception of the mortgage bond but "has not given any reasons as to why the document could not be received in evidence for the limited purpose of showing as to how the defendant came into possession of the suit property." The revisional court treated the absence of adequate reasons as a material flaw.
  2. The court emphasized the plaintiffs' clear statement that they would not enforce rights under the deed and that the suit was based on title and recovery of possession; the mortgage bond was sought only to establish how and when the defendant entered into possession (i.e., to show possession from 1957 rather than from 1955).
  3. The revisional court analyzed Section 49 of the Registration Act (including its proviso added by the 1929 amendment), which permits reception in evidence of an unregistered document affecting immovable property "as evidence of any collateral transaction not required to be effected by registered instrument." The opinion reproduced the text of Section 49 and relied upon the proviso's language to permit reception for a collateral purpose.
  4. The court reviewed authorities, especially B. Narayanamma v. Ramaiah, which held that an unregistered transfer document required to be registered is admissible in evidence to prove the date and fact of entry into possession and to show the character of possession, although not admissible to claim substantive rights under the document. The revisional court described that judgment as "clinching the issue" and summarized that a document need not be admitted by the defendant to be receivable; it would, in any event, be subject to proof.
  5. The revisional court rejected the lower court's reliance on certain precedents and its treatment of the absence of the defendant's admission as fatal to admissibility. The revisional court held that the unregistered mortgage bond could be received in evidence for the collateral purpose of showing how the defendant obtained and character of possession, but that the document would remain "subject to proof."
  6. The court also implicitly addressed procedural points relied on by the lower court: the fact that the document was filed after more than one year of the suit and earlier court directions to file it did not, in the revisional court's view, justify outright exclusion where the document was relevant for a collateral purpose.

Holding and Implications

Holding: The revision petition is allowed; the order of the lower court dated 23-12-1975 is set aside and the mortgage bond filed by the plaintiffs is admissible in evidence to show the nature of the defendant's possession, subject to proof.

Implications and direct consequences:

  • The document may be received in evidence for the collateral purpose of proving when and how the defendant entered into possession and the character/nature of that possession; it is not received to automatically confer substantive rights under the instrument.
  • Admissibility does not dispense with the necessity of proving the document's contents and authenticity; it will be "subject to proof" during trial.
  • The parties will bear their own costs in relation to this revision petition, as ordered by the court.
  • This opinion does not expressly state any broader precedent-setting intention; its holding applies to the present facts (admission of an unregistered document for a collateral purpose under Section 49's proviso) and the court relied on existing authorities in reaching its conclusion.

Disposition: Revision allowed.

    Hari Waman Rao And Others v. Pappula Narsimulu .

    (1) This is a revision by the plaintiffs against the order dated 23 - 12 - 1975 of the additional district judge, adilabad, refusing to receive a document in evidence filed by the plaintiffs during the course of examination of a witness. The plaintiffs - petitioners filed the suit for recovery of possession on the basis of title. It is alleged that late venkata rao borrowed a sum of rs. 1,000 from the defendant in the month of february, 1957 and that the suit property was put in the defendants possession by way of usufructuary mortgage for 14 years with a stipulation for appropriating the usufruct towards the debt borrowed by late venkata rao. A mortgage bond was also executed to that effect. The period of 14 years expired in the month of january, 1971. Since then the defendant is in wrongful possession and did not deliver possession to the plaintiffs in spite of oral demands and a lawyers notice, d/ - 10 - 1 - 1972. The defendant in his written statement denied the debt alleged to have been borrowed by late venkata rao, the predecessor - in - title of the suit land. It is also alleged that late venkata rao agreed to sell the property to the defendant in the year 1955 or so. Since 1955 the defendant is in possession of the property. Thus he perfected his title to the property by adverse possession. The story of execution of the mortgage bond is concocted.

    (2) On behalf of the plaintiffs p. W. 1 was examined on 22 - 12 - 1975. At that time the mortgage bond executed by late venkata rao was sought to be exhibited. But the counsel for the defendant objected to its reception in evidence on the ground that it is an unregistered one. It was contended by the plaintiffs that the document was being produced for the limited purpose of showing the nature of possession of the suit lands by the defendant.

    (3) In the lower court, the learned counsel for the plaintiffs relied on two decisions, viz. , amina bi v. Khamrunnisa, air 1974 mad 54 and kolathoor variath v. P. C. Kumhahammad haji, air 1974 sc 689. It was held in ameena bees case that the document was admissible to show that fateema bee was the landlady and the tenants who executed the rent deeds were the tenants holding under her. The lower court held that this decision is not applicable. Similarly relying on the decision in kolathoor variath v. P. C. Kumhahammad haji (air 1974 sc 689) (supra) the lower court held that as the very mortgage is not admitted, the document is not admissible in evidence. It may be noted that the mortgage alleged in the decision of the supreme court was oral. What the supreme court held was that the plaintiff could not regain possession on the basis of an oral mortgage as it could not be provided (proved?) in the court of law for want of registration, but it was open to recover possession on the strength of his title. On that analogy, the lower court held that the usufructuary mortgage deed now filed could not be admissible in evidence for want of registration. The next decision cited was lachhmi narain v. Kalyan, air 1960 raj 1 (substantial) wherein it was held:

    "the provisions of section 49 of the registration act or section 91 of the evidence act are not affected because an unregistered document can be availed of for the purpose of showing character and nature of possession, if the possession is transferred under such document."

    The lower court on the ground that the defendant did not admit that he was put in possession by virtue of the usufructuary mortgage held that the document could not be admitted, i. E. , unless the defendant admits the mortgage deed and also admits that he came into possession by virtue of that deed, it could not be admitted in evidence. The other ground which weighed with the lower court was that the document was filed in court on 1/03/1973, more than one year after the suit was filed. On 7 - 2 - 1972 objection was taken for not filing the mortgage bond referred to in the plaint and the court directed the plaintiffs to file the same. But the document was not filed and the plaint was represented on 10 - 2 - 1972 with note that the suit was filed on the basis of title. Plaintiffs did not want to rely on mortgage deed nor the suit was for redemption of mortgage. Only it was stated as to how the defendant came into the possession of the property. For this purpose, it was averred that the defendant paid rs. 1,000 and to recover that amount, the lands were handed over to the defendant. No registered mortgage was executed and so it is not possible to file that document. Thus the lower court was of the view that the counsel for the plaintiffs was conscious that the document was not admissible for want of registration and therefore refused to file in court at that time. Therefore, it was commented as to how that document could be received in evidence even to show as to how the defendant came into possession of the suit lands. The lower court relied upon the authorities quoted by the learned counsel for the defendant in pedda (1969) 1 alt 375 : (air 1969 andh pra 242) (fb) , gadiraju sanyasi raju v. Kamappadu, air 1960 andh pra 83 (fb) , venkateswarlu v. Ranga reddy, 1956 andh lt 998 and balakistiah g. V. B. Ranga reddy, air 1960 andh pra 112. The lower court similarly stated that the above authorities were relied upon for the proposition that the unregistered usufructuary mortgage bond could not be admitted in evidence. The lower court is clear in expressing the view that the learned counsel for the plaintiffs wanted to file the document for the limited purpose of showing how the defendant came into the possession of the suit property, but it took the view that as the document was not registerable under law, it could not be admitted in evidence.

    (4) Thus, the order clearly shows that the lower court has not given any reasons as to why the document could not be received in evidence for the limited purpose of showing as to how the defendant came into possession of the suit property. The plaintiffs have categorically stated that the rights under the deed are not going to be enforced and the suit is not for redemption of the mortgage, but the suit is one based on the title for recovery of possession. The defendant did not deny the title of venkat rao to the suit land. But what he alleged in the written statement was that in 1955 late venkat rao agreed to sell the property and put him in possession of the land in that year in pursuance of the agreement of the sale. On the other hand, the allegation in the plaint is that the possession was given to the defendant in pursuance of the mortgage bond executed in 1957. Therefore, the purpose for which the document was sought to be produced is to show that the defendant came into possession of the property not by virtue of the agreement of sale by late venkat rao in 1955, but on account of the mortgage transaction in february 1957. Thus the plaintiffs wanted to prove that the defendant was in possession of the suit lands from 1957 onwards by virtue of the mortgage transaction and for that purpose the document was sought to be produced in the court and admitted in evidence. In view of the proviso to section 49 of the registration act, the document could be received as evidence of a collateral transaction not required to be effected by the registered instrument. Section 49 of the registration act reads as under:

    "no document required by section 17 or by any provision of the transfer of property act, 1882 to be registered shall - (a) affect any immovable property comprised therein, or (b) confer any power to adopt, or (c) be received as evidence of any transaction affecting such property or conferring such power, unless it has been registered: provided that unregistered document affecting immoveable property and required by this act or the transfer of property act, 1882, to be registered may be received as evidence of a contract in suit for specific performance under chapter ii of the specific relief act, 1877 or as evidence of part performance of a contract for the purposes of section 53 - a of the transfer of property act, 1882 or as evidence of any collateral transaction not required to be effected by registered instrument."

    Thus, the proviso added by amendment act of 1929 clearly envisages that an unregistered document is admissible in evidence for collateral purpose, i. E. , for a purpose other than that of creating, declaring or assigning, limiting or extinguishing a right in property. In b. Narayanamma v. Ramaiah (1975) 2 andh pra lj 298, it was held:

    "an unregistered document of transfer which is required to be registered and not registered is admissible in evidence to prove the date of entering into and the fact of possession of the transferee and to show the character of his possession. Though an unregistered under law is not admissible to evidence to claim any right under it, it would be admissible in evidence for a collateral purpose i. E. , for a purpose other than that for which the document was created."

    In that case, even though the plaintiffs filed a suit for declaration of their title to the property and for recovery of possession, it was alleged that the defendants were put in possession as lessees under exs. A - 1 to a - 3, the lease deeds, which were denied. Perfection of title by adverse possession was also pleaded by denying lease deeds ex. A - 1 to a - 3. It was also pleaded that the predecessor in title of the plaintiffs executed an agreement and on that basis, he is entitled to register the claims of the plaintiffs as provided under section 53 - a of the transfer of property act, and thus also claimed adverse possession as stated above. The trial court found that exs. A - 1 to a - 3 were true and the lands were leased out to the first defendant by kowlutlayya, the predecessor in title of the plaintiffs. It was also found that ex. B - 2 was not true and ultimately the trial court negatived the contention of adverse possession of the first defendant on the basis of exs. A - 1 to a - 3 and decreed the suit. On an appeal filed by the first defendant the appellate court came to the conclusion that exs. A - 1 to a - 3 were not admissible in evidence even to show the nature of possession and with regard to the truth of exs. A - 1 to a - 3, the learned judge did not go into it. It also held that ex. B - 2 is true and is binding on the plaintiffs. After discussing the other material which is not relevant for the purpose of this revision, the learned subordinate judge allowed the appeal and dismissed the suit. In the second appeal the first point raised was that the learned subordinate judge erred in thinking that exs. A - 1 to a - 3 are not admissible in evidence even to show the nature of possession. The learned judge relying upon various decisions and after discussing the provisions of section 49 and its proviso, summed up in para 26 of his judgment that exs. A - 1 to a - 3 are admissible in evidence to show the character and possession of the first defendant as a lessee and therefore such possession was not adverse to that of kowlutlayya. But it was to be found whether they are true or not. Therefore, the case was remanded to the lower court. This judgment really clinches the issue involved in this revision petition on all points. It is not necessary that the document must be accepted by the defendant if it is filed by the plaintiffs. Even if it is denied the document will be subjected to proof. But the document for the said collateral purpose could be received in evidence. Therefore, in that view, i totally agree with the view taken by my learned brother ramachandra raju, j.

    (5) Therefore, i am clearly of the view that the lower court erred in holding that the document is not admissible in evidence even for the collateral purpose as it is not admitted by the defendant.

    (6) In the result, the revision petition is allowed. The order of the lower court is set aside. The document filed is admissible to show the nature of possession of the defendant, but the document would be subject to proof. In the circumstances the parties will bear their own costs.

    (7) Revision allowed.

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    Comments

    Hari Waman Rao And Others v. Pappula Narsimulu .
    (Feb 10, 1977)