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Smart Summary

Factual and Procedural Background

The plaintiff appealed from a decision in a suit for declaration of title and recovery of possession relating to 1 katha of land out of Survey Plot No. 1169 in village Sultangunj. The plaintiff relied on a registered sale-deed dated 5 October 1942 executed by defendant No. 1 for Rs. 100 in respect of the entire plot (measuring .05 acre = 1 katha 14½ dhurs). The plaintiff's pleaded case was that he paid the entire consideration and came into possession of the whole plot but was dispossessed from the disputed 1 katha in June 1946; the suit was instituted on 6 July 1946.

The defendants contended that the true consideration was Rs. 170 though the deed recited Rs. 100, and that the plaintiff had paid only Rs. 70; therefore the registered sale-deed remained with the defendants and was inoperative. A panchayat (panches) decision was said to require defendant No. 1 to execute a fresh sale-deed in respect of 14 dhurs, which the plaintiff allegedly amalgamated with his house; the remaining 1 katha remained with the defendants. A subsequent (unregistered) sale-deed for Rs. 50 in respect of the 14 dhurs in favour of the plaintiff's son was alleged by the defendants.

Before the trial court (learned Munsiff) the suit was decreed: the Munsiff held that Section 92 of the Evidence Act precluded defendants from proving a different consideration, found that the plaintiff paid Rs. 100 and had been dispossessed, and rejected the defendants' panchayati account. On appeal the learned Subordinate Judge agreed that oral evidence was inadmissible to alter the recited consideration, but found that only Rs. 70 had been paid, that the parties intended title to pass only on payment of full consideration, and that the plaintiff had not acquired title or possession under the registered deed; the Subordinate Judge allowed the appeal and dismissed the suit. The present opinion is by the High Court on the second appeal from that order.

Legal Issues Presented

  1. Whether title to the property passed to the vendee by mere execution and registration of the sale-deed, or whether the parties' intention (as gathered from the sale-deed) was that title would pass only on payment of the whole and entire consideration money.
  2. Whether oral evidence is admissible to contradict the recital in a registered sale-deed about receipt of consideration (in light of Section 92 of the Evidence Act), to show that the recited consideration was untrue.
  3. Whether subsequent panchayati/award or subsequent unregistered dealings affect the question of title to the disputed 1 katha in light of the findings about payment and possession.

Arguments of the Parties

Appellant's Arguments (on behalf of the plaintiff, Mr. S.C. Misra)

  • The appellant sought to distinguish precedent on the ground that here the bulk of the consideration (Rs. 70 out of Rs. 100) had been paid, and thus that defendants should not be permitted to resist vesting of title.
  • The appellant relied on a recital in the sale-deed that the executant (vendor) would not in future put forward any claim in respect of the consideration money, arguing this reinforced that the consideration had in fact been paid and title had vested.
  • The appellant further relied on a recital giving the vendee remedies to recover costs and the entire consideration with interest in case of dispossession by the executant, arguing this showed the intention that title vested in the vendee immediately.
  • Mr. Misra argued that, under the Indian Arbitration Act, 1940, the court should not have taken into account the panches' award (the panchayati), or in any event that the panchayati should not affect the appellant's claim to the disputed area.
  • It was also urged that because the bulk of the consideration had been paid the defendants ought to have performed their part of the contract.

Respondents' / Defendants' Arguments

  • The defendants contended the true consideration was Rs. 170 though the deed recited Rs. 100, and that the plaintiff had paid only Rs. 70; accordingly the sale-deed remained with the defendants and was inoperative to pass title.
  • The defendants relied on the panches' decision which, according to them, required defendant No. 1 to execute a fresh sale-deed in respect of 14 dhurs; they said the disputed 1 katha remained in their possession.
  • The defendants also alleged a subsequent (unregistered) sale-deed for Rs. 50 in respect of 14½ dhurs in favour of the plaintiff's son (as part of their account of subsequent dealings), and denied that the registered deed had been made over to the plaintiff or that possession under it had been given.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Rasikananda Mallick v. Gangadhar Panda, 1 Cut LT 1 Authority for the principle that the intention of the parties as to when title should pass is to be gathered from the sale-deed itself. The court relied on this case as an example where similar recitals required payment of the whole consideration before title would pass; it supported the conclusion that the present deed showed intent that title depends on full payment.
Radhamohan Thakur v. Bipin Behari Mitra, ILR 17 Pat 318 Holds that intention is to be gathered from the deed, and that even if a sale-deed recites receipt of consideration, parties may adduce evidence to show the recital is untrue. The court cited this authority to note that a recital that consideration was received does not absolutely bar evidence to the contrary; nevertheless, given the deed's wording and factual findings here, the court found title depended on full payment.
Md. Murtaza v. Abdul Rahman, 27 Pat 122 Similar rule: the deed's words govern intention; recital of payment may be rebutted by evidence showing the recital false. The court used this precedent to reinforce that recitals may be examined and rebutted, but that where (as here) the recitals indicate title passes only on payment and the facts showed non-payment and lack of delivery of deed and possession, title did not pass.
Motilal Sahu v. Ugrah Narain Sahu, AIR 1950 Pat 288 Support for the proposition that where sale-deeds are worded to make passing of title depend on payment, the court will treat title as not having passed absent payment; ambiguity permits consideration of facts such as retention of the deed and non-delivery of possession. The court applied this authority by examining similar wording in the present deed and the surrounding facts (non-delivery of deed, non-possession) to conclude the parties intended title to depend on full payment, and therefore the plaintiff had not acquired title.

Court's Reasoning and Analysis

The court proceeded by focusing on the wording of the registered sale-deed (Exhibit A/2) and on the factual findings of the Subordinate Judge. The key recitals quoted by the court included:

“Having received payment of the whole and entire consideration money to cash from the aforesaid vendee, I put him (the vendee) in possession and occupation of the vended property.”

and

“On receipt of the fair consideration money I the executant sell the vended land.”

From these recitals the court concluded that the deed itself indicated an intention that title and possession were to follow on payment “of the whole and entire consideration money.” The court compared the deed's wording to the language considered in the cited precedents (Rasikananda, Radhamohan, Md. Murtaza, Motilal Sahu) where similar formulations led to the conclusion that title would pass only on payment of the entire consideration.

The court then applied the Subordinate Judge's factual findings to the legal principle established by the precedents:

  • The Subordinate Judge found that the entire consideration was not paid (only Rs. 70 of the recited Rs. 100), that the executant/vendor did not make over the registered sale-deed to the plaintiff, and that the plaintiff did not come into possession of any portion of the vended plot by virtue of the registration of the sale-deed.
  • Given these findings, and given the express recitals that title and possession follow payment of the whole consideration, the court agreed that the intention was that title would pass only on payment of the entire consideration.

The court addressed each of the appellant's contentions and explained why they did not alter the result:

  • That the bulk (Rs. 70) had been paid — the court held this to be immaterial where the deed expresses an intention that the whole sum must be paid before title will pass.
  • The recital barring future claims by the vendor for the consideration — the court noted this recital aimed at preventing the vendor from asserting a claim for the consideration, but that the precedents permit proof that such a recital is untrue; nonetheless the other recitals and facts supported the Subordinate Judge's conclusion.
  • The recital giving the vendee remedies to recover costs and consideration in case of dispossession by the executant — the court interpreted these words as presupposing that the entire consideration had been paid (otherwise dispossession could not arise in the sense contemplated) and therefore not indicative of immediate vesting of title absent payment.
  • That the defendants ought to have performed because the bulk was paid — the court observed that this was not a suit for specific performance and that the plaintiff never asserted readiness and willingness to pay the balance; moreover, the suit was instituted more than three years after registration.
  • Reliance on the panchayati and the Indian Arbitration Act — the court held that the area in dispute was not altered by the panchayati in respect of the disputed 1 katha and that the Subordinate Judge's finding meant merely that the plaintiff obtained possession of 14½ dhurs by some subsequent amicable arrangement; the panchayati did not change the central issue about title under the registered deed.

Considering the deed language, the precedents, and the factual findings, the court concluded the Subordinate Judge correctly held that title did not pass on registration given non-payment of the whole consideration.

Holding and Implications

APPEAL DISMISSED

Direct effect on the parties:

  • The High Court affirmed the Subordinate Judge's judgment: the plaintiff did not acquire title to the disputed 1 katha by virtue of the registered sale-deed because the whole and entire consideration was not paid, the registered deed was not made over by defendant No. 1, and possession had not been delivered pursuant to the deed.
  • The appeal was dismissed with costs (as stated by the court).

Broader implications:

The opinion applies established authorities and reiterates the principle that the parties' intention about when title should pass is to be gathered from the terms of the sale-deed; where the deed conditions vesting of title on payment of the whole consideration, a partial payment (even of the bulk) is immaterial to vesting. The court did not purport to lay down a new precedent beyond applying these existing authorities, and no broader change in law was announced in the opinion.

    Panchoo Sahu v. Janki Mandar And Others

    Chatterji, J.:— This is an appeal by the plaintiff in a suit for declaration of title and recovery of possession in respect of 1 katha of land out of Survey Plot No. 1169 in village Sultangunj.

    2. The plaintiff claims title to the disputed 1 katha of land under a registered sale-deed, dated the 5th October, 1942, executed in his favour by defendant No. 1 for Rs. 100/- in respect of the entire Plot No. 1169 measuring .05 acre equivalent to 1 katha 14½ dhurs. The plaintiff's case is that he paid the entire consideration money to defendant No. 1, but the latter never made over the registered sale-deed to him in spite of demands. The plaintiff, however, it is said, came into possession of the entire plot and amalgamated 15 dhurs out of it with his house. The remaining 1 katha which is in dispute was used by him as his bari, but the defendants dispossessed him from it on 1st Asarh 1353 Fs. (June 1946). The suit was instituted on 6th July, 1946. The defendants belong to the same family of which the defendant No. 1 is the head. Their defence is that the real consideration of the sale-deed in favour of the plaintiff, executed by defendant No. 1, was Rs. 170/- though only Rs. 100/- was mentioned in the deed, and that the plaintiff paid only Rs. 70/- out of the consideration and did not pay the balance and, therefore, the sale-deed remained with the defendants. There was a difference between the parties which was referred to Panches and, according to the decision of the panches defendant No. 1 was to execute a fresh sale-deed in favour of the plaintiff in respect of 14 dhurs out of the Plot No. 1169. The plaintiff accordingly amalgamated 14 dhurs with his house and the disputed 1 katha remained in possession of the defendants as before. The defendant No. 1 also executed a fresh sale-deed for Rs. 50/- in favour of the plaintiff's son in respect of this 14 dhurs. This sale-deed, however, was not registered. According to the defendants, the registered sale-deed, dated the 5th October, 1942, is inoperative and the plaintiff is not entitled to any relief on the basis of that deed.

    3. The learned Munsiff who tried the suit held that the defendants were precluded by Section 92 of the Evidence Act from proving that the consideration money of the sale-deed in question was not Rs. 100/- but Rs. 170/-. He also held that the plaintiff paid the entire consideration money Rs. 100/- and came into possession of the entire plot, but was subsequently dispossessed by the defendant from the disputed land. He did not accept the story of the panchayati set up by the defendants. He accordingly decreed the suit.

    4. On appeal, the learned Subordinate Judge agreed with the learned Munsiff that oral evidence was not admissible to prove that the consideration of the sale-deed in question was Rs. 170/- and not Rs. 100/-. But he held that out of the consideration of Rs. 100/- the plaintiff paid Rs. 70/- only to defendant No. 1. He also held that the Intention of the parties was that title to the land would pass on payment of the entire consideration and as the entire consideration was not paid, the plaintiff did not acquire any title to the disputed land. He further held that the plaintiff never came into possession of any portion of Plot No. 1169 by virtue of the sale-deed, but came into possession of only 14½ dhurs out of it, sometime later as a result of the panchyati alleged by the defendants. He, however, did not accept the defendants' case about the execution of the subsequent sale-deed in respect of the 14½ dhurs. In the result he allowed the appeal and dismissed the suit. Hence this second appeal.

    5. The main question for determination in this appeal is whether title passed on the mere execution and registration of the sale-deed in question, or, the intention of the parties was that the would not pass until the full consideration was paid. This question has been considered by this Court in various cases and it is now well-settled that the intention is to be gathered from the sale-deed itself; ‘Rasikananda Mallick v. Gangadhar Panda’, 1 Cut LT 1; ‘Radhamohan Thakur v. Bipin Behari Mitra’. 17 Pat 318; ‘Md. Murtaza v. Abdul Rahman*’, 27 Pat 122 and ‘Motilal Sahu v. Ugrah Narain Sahu’, AIR (37) 1950 Pat 288. It has also been laid down in the second case ILR 17 Pat 318 and in the third 27 Pat 122, that though the sale-deed may recite that the consideration has been paid, there is nothing to prevent the parties from adducing evidence to show that the recital is untrue and that in fact the consideration was not paid.

    6. The sale-deed in question, Exhibit A/2, recites:

    “Having received payment of the whole and entire consideration money to cash from the aforesaid vendee, I put him (the vendee) in possession and occupation of the vended property.”

    7. It again recites, lower down:

    “On receipt of the fair consideration money I the executant sell the vended land.”

    8. These recitals clearly indicate that title would pass and possession would be delivered on payment “of the whole and entire consideration money.” In the cases in ‘Rasikananda v. Gangadhar’, 1 Cut LT 1; ‘Md. Murtaza v. Abdul Rahman*’, 27 Pat 122 and ‘Motilal Sahu v. Ugrah Narain Sahu’ AIR (37) 1950 Pat 288, already cited, the sale-deeds were similarly worded and it was held that the intention of the parties was that the passing of title should depend on the passing of consideration. In the last two cases it was also held that if the terms of the sale-deed were ambiguous, the Court might also take into consideration the facts that the vendor retained the sale deed and never made it over to the vendee and that possession was not delivered in pursuance of the sale deed. In the present case, it has been found by the learned Subordinate Judge that the entire consideration money was not paid, that the defendant No. 1 did not make over the sale deed to the plaintiff and that the plaintiff never came in possession of any portion of the vended plot consequent on the registration of the sale deed. Upon these findings, taken with the recitals in the sale deed, I think, the learned Judge was quite right in coming to the conclusion that “the intention of the parties was that title would pass to the vendor only on payment of the entire consideration money and not otherwise”.

    9. Mr. S.C Misra on behalf of the appellant seeks to distinguish the present case from the aforesaid decisions on the ground that here the bulk of the consideration money, that is, Rs. 70/- out of Rs. 100/- was paid. But if the intention of the parties, as gathered from the sale deed itself was that title would pass only on payment “of the whole and entire consideration money”, it is immaterial that the bulk of the consideration was actually paid.

    10. Mr. Misra also lays great stress on the following recital in the sale deed which comes immediately after the first of the two above-quoted passages:

    “Should in future, at any time I, the executant or my heirs and representative put forward any claim in respect of the consideration money of the sale deed of the vended property it will be illegal and null and void in Court.”

    11. But this recital obviously means that the vendor would not put forward any claim for the consideration money; in other words, it would not be open to him to dispute the correctness of the recital that he received the consideration money. As pointed out in ‘Radhamohan v. Bipin Behari’, 17 Pat 318 and in ‘Md. Murtaza v. Abdul Rahman*’, 27 Pat 122 that in spite of such recital, it would be open to the parties to show that it was incorrect.

    12. Mr. Misra then relies on the following recital in the sale deed:

    “Should, on account of any act done by me the executant there be found any kind of defect on the vendee viz. the claimant be put to any trouble and loss in the matter of the purchase of the vended property and in consequence thereof lie (vendee) be dispossessed (from the vended property) or I, the executant or my heirs and representative dispossess him (vendee) or get him dispossessed (from the vended property), the said vendee shall be competent to realise the entire costs, damages and the entire consideration money paid with interest at the rate of Rs. 1/- per cent per month from the date of dispossession to the date of realization from the person and properties of me the executant and my heirs and representatives.”

    13. It is said that this shows that the intention was that the title would at once vest in the vendee. But this passage must be considered along with the earlier recital which clearly shows that the vendee would be put in possession of the vended property on receipt of the whole and entire consideration money”. If the entire consideration money was not paid, possession would not be delivered and, therefore, no question of dispossession of the vendee could arise. The words “the said vendee shall be competent to realise the entire costs, damages and the entire consideration money paid with interest” in the passage relied upon are pertinent and they obviously mean that the vendee would be liable to refund the entire consideration money with costs, damages etc. This implies that the entire consideration money must have been paid.

    14. Mr. Misra next contends that the plaintiff having paid the bulk of the consideration of the sale deed, the defendants ought to have performed their part of the contract. But this is not a suit for specific performance and the plaintiff never suggested in his plaint that he was ready and willing to pay the balance of the consideration money. On the contrary, his case was that he paid the entire consideration and came into possession of the entire vended property. It is important to notice that the suit was instituted more than three years after registration of the sale deed.

    15. Mr. Misra further contends that the learned Subordinate Judge in view of the provisions of the Indian Arbitration Act, 1940, should not Have at all taken into consideration the award of the panches by reason of which the plaintiff is said to have been given possession of the 14½ dhurs out of the vended plot. But that area is not in dispute and, therefore, the question of panchyati is not relevant. Besides, the decision of the learned Judge means no more than that the plaintiff came into possession of the 14½ dhurs by some subsequent amicable arrangement.

    16. In my opinion, the decision of the learned Subordinate Judge is right and the appeal must be dismissed with costs.

    17. Lakshmikanta Jha, C.J:— I agree.

    R.G.D

    18. Appeal dismissed.

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    Panchoo Sahu v. Janki Mandar And Others
    (Sep 26, 1951)