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Chunni Bibi v. Basanti Bibi
Structured Summary of the Opinion
Factual and Procedural Background
The respondents sold zamindari property to the appellant. On 21 July 1909 some of that property had earlier been sold in execution of a decree; the appellant had hoped to get the execution sale set aside but, due to the then interpretation of Order XXI, Rule 89, neither vendors nor purchasers could obtain that relief. The appellant therefore relinquished her interest by a registered deed. The respondents then raised a mortgage in favour of Parsotam Das to raise funds to pay the decree-holder and eventually the execution sale was set aside.
On 28 October 1909 the respondents executed a sale deed in favour of the appellant reciting a sale for Rs. 40,000 and reciting that the whole consideration had been received and that Parsotam Das and other creditors had been paid out of it. At registration the respondents admitted receipt of Rs. 37,600 and received Rs. 2,400 there and gave the appellant a receipt for Rs. 37,600.
The respondents instituted the present suit on 3 November 1912 (the last day of limitation) claiming a balance of purchase money and interest. They alleged they were induced by persons acting for the appellant to acknowledge full receipt of the Rs. 40,000 when, in truth, only Rs. 11,726 had been paid to Parsotam Das (plus Rs. 1,000 spent in connection with the deed and Rs. 2,400 paid at registration). The respondents therefore claimed Rs. 24,874 and interest. The appellant disputed these allegations, saying the true consideration was Rs. 15,126 (the three sums noted above) and that the larger amount was put in the deed to avoid giving Parsotam Das cause to complain.
The core procedural question before the court was whether the appellant was entitled to produce oral evidence to prove her allegations; the court below had refused to allow such oral evidence. The appeal challenges that ruling. The final order of this Court allowed the appeal, set aside the decree below and remanded the case for fresh trial permitting the parties to adduce evidence.
Legal Issues Presented
- Whether the appellant is entitled to produce oral evidence to prove that the true consideration for the sale was different from, or less than, the amount recited in the registered sale deed.
- Whether the provisions of Section 92 of the Evidence Act (and its first proviso), and the related Section 91, permit or bar such oral evidence in the circumstances of this case.
- Whether, as contended by the appellant, the sale deed could be rectified or rescinded on the basis of mistake or misrepresentation (this argument was raised but not pressed strongly before the Court).
Arguments of the Parties
Appellant's Arguments
- The appellant asserted that the real consideration paid was much lower (Rs. 15,126) than the Rs. 40,000 recited in the sale-deed and that the respondents admitted receiving only certain sums (Rs. 11,726 to Parsotam Das, Rs. 1,000 for execution-related expenses, Rs. 2,400 at registration).
- She argued that if the respondents were entitled to go behind the recital and admission in the deed to prove the entire consideration had not been paid, then she should be allowed to produce oral evidence to establish the true nature and extent of the consideration.
- She relied on decisions (a number of earlier cases) supporting admission of oral evidence where the recital in a deed did not reflect the true transaction, and invoked the first proviso to Section 92 of the Evidence Act. Other contentions (rectification/rescission and Section 91) were mentioned but not pressed seriously.
Respondents' Arguments
- The respondents relied upon the Madras High Court decision in Adityam Iyer v. Ramakrishna Aiyar (1913) 25 M.L.J. 602 to argue that the oral evidence the appellant sought should be excluded.
- They accepted that some of the earlier cases cited by the appellant established limited principles embodied in Section 92, but contended that many of those cases did not support the broader proposition that a party may prove by oral evidence that the consideration is different in amount from that stated in the deed.
- They argued that several decisions relied upon were examples where the consideration had passed in a different form (not necessarily a different amount) and that the appellant's reliance on the authorities was therefore misplaced; where the deed was invalidated within the first proviso to Section 92, they argued, oral evidence was admissible, but not otherwise.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Shah Mukhun Lal v. Baboo Sri Kishen Sing (1868) 12 Moo. I.A. 157 | The Privy Council passage stating that, although rules of evidence and estoppel prevent variation of deeds, exceptions exist (fraud, illegality, redemption) where a party may "remove the blind" and show the real transaction. | The Court relied on this passage as an authoritative statement of the exception allowing a party to go behind a deed in appropriate cases (fraud, illegality, redemption) and used it as a foundational principle for admitting oral evidence when the deed's recital is shown to be untrue. |
| Lala Himmat Sahai Singh v. Llewhellen (1885) I.L.R. 11 Calc. 486 | Held that under the first proviso to Section 92 a party could go behind a recital and prove that only part of the recited payment had been made and that the residue was dealt with by an agreement (oral evidence) between the parties. | The Court treated this as authority that supports admission of oral evidence to prove that payment was different in character or amount from the recital, where the first proviso to Section 92 applies. |
| Hukumchand v. Hiralal (1876) I.L.R. 3 Bom. 159 | Observed that Section 92 does not prevent a party to a contract from showing that there was no consideration or that the consideration was different from that described in the contract. | Used to support the proposition that a party may prove the true consideration even if the deed recites a different figure or form of consideration. |
| Indarjit v. Lal Chand (1895) I.L.R. 18 All. 168; affirmed I.L.R. 22 All. 370 | Authority for admitting evidence to show that no consideration passed or that the consideration was to be accounted for in a form different from that recited in the deed. | Cited for the proposition that a party may prove circumstances under which payment was postponed or arranged differently from the recital in the deed. |
| Kailash Chandra Neogi v. Harish Chandra Biswas (1900) 5 C.W.N. 158 | In a suit to set aside a sale-deed where the deed recited receipt of a sum, the court allowed proof that the actual consideration differed (that some consideration existed though not in the amount stated). | Referred to as an instance where the defendant could prove that there was some consideration even if not to the extent recited in the deed; used to show scope of the first proviso to Section 92. |
| Nathu Khan v. Sewak Koeri (1911) 15 C.W.N. 408 | Permitted proof that the stated consideration in a kabala had not been paid and that the real consideration was different (services rendered). | Applied as an authority that supports admitting oral evidence to establish the true consideration when the recited amount was not in fact paid. |
| Muhammad Yusuf v. Muhammad Musa (Weekly Notes 1907 p. 181) | Allowed proof that the recited cash consideration did not represent the true consideration, which was instead of another form (exchange of property or services). | Cited as another example showing that oral evidence may be admissible to prove the true nature of the consideration despite a contrary recital. |
| Hanif-un-nissa v. Faiz-un-nissa (1911) I.L.R. 33 All. 340 | The Privy Council held that oral evidence could be given to prove the real nature of a transaction (the deed purported to be a sale but defendants proved it was in fact a gift), apparently treating the case as falling within the first proviso to Section 92. | The Court and a concurring judge regarded this decision as decisive and directly analogous, holding that it supports the admissibility of oral evidence to prove the true nature/extent of consideration despite a contrary recital in the deed. |
| Jamna Doss v. Srinath Roy (1886) I.L.R. 17 Calc. 176 (note) | Mentioned in argument in relation to Section 91 and Section 92 (the appellant referred to it), but the opinion states the point was not pressed and the Court deemed it unnecessary to consider it in detail. | The Court noted the citation but recorded that the argument based upon it was not seriously pressed and that it was unnecessary to examine it further in the judgment. |
| Adityam Iyer v. Ramakrishna Aiyar (1913) 25 M.L.J. 602 (Madras) | A Madras High Court decision relied upon by the respondents which held that oral evidence was not admissible to prove an arrangement (discharge of a mortgage) alleged to be part consideration for a sale where the deed did not mention such discharge. | The Court in the present opinion distinguished that decision on its facts, finding it not to be a case where a party had denied receipt of consideration acknowledged in the deed; therefore the Madras case was not treated as controlling here. |
Court's Reasoning and Analysis
The Court analyzed the authorities cited and the statutory provision (Section 92 of the Evidence Act, particularly its first proviso) to determine whether oral evidence was admissible to contradict a recital in a registered deed that the whole consideration had been received.
Key steps in the Court's analysis, as set out in the opinion:
- The Court acknowledged the general rule that written documents and their recitals are protected by the rules of evidence and estoppel against oral contradictions, but it emphasized authoritative exceptions recognized by the Privy Council and embodied in Section 92 — notably in situations of fraud, illegality, redemption and where proof shows the recital to be untrue.
- The Court reviewed a sequence of cases in which courts allowed parties to go behind recitals, distinguishing between (a) cases where the recital misdescribed the form in which consideration passed (e.g., it passed in some other form such as services or exchange of property) and (b) cases where it was alleged that the recited consideration had not in fact passed at all. The Court noted that several of the cited authorities fall into the former category while a few (including the Privy Council decision in Hanif-un-nissa) involved the latter situation.
- The Court identified an important common ground in several authorities: when one party alleges and proves that the consideration acknowledged in the deed did not in fact pass, the case falls within the first proviso to Section 92 and the other party may be permitted to prove what the true consideration was (by oral evidence).
- The Madras decision relied upon by the respondents (Adityam Iyer) was considered and distinguished on its facts: that case did not involve a direct denial by one party of receipt of the consideration acknowledged in the deed and therefore was not applicable to the present situation in the Court's view.
- Applying these principles to the present record, the Court concluded that the respondents had alleged and proved that the whole of the consideration acknowledged in the deed had not passed. Consequently, the appellant should be permitted to adduce oral evidence to support her allegations about the true nature and amount of the consideration.
- Because the court below had refused to admit that oral evidence, the Court found it necessary to remand the case for fresh trial so that the appellant may be allowed to present the oral evidence and the case may be tried on the facts with that evidence before the lower court.
A concurring opinion (Pramada Charan Banerji, J.) expressly relied on the Privy Council's decision in Hanif-un-nissa v. Faiz-un-nissa (1911) as dispositive of the issue and stated that the present case could not be distinguished from that principle; he therefore also held that oral evidence should be permitted and remand was required.
Holding and Implications
Holding (core ruling):
APPEAL ALLOWED; DECREE OF THE COURT BELOW SET ASIDE; CASE REMANDED FOR FRESH TRIAL WITH DIRECTIONS TO PERMIT THE PARTIES TO ADDUCE EVIDENCE.
Implications and direct consequences:
- The appellant is entitled to produce oral evidence to prove her allegations that the actual consideration was different from, and less than, the amount recited in the sale deed.
- The court below is directed to re-admit the case under its original number and to dispose of it according to law after allowing the parties to adduce such evidence as they may bring forward.
- The costs incurred to date are ordered to be costs in the cause.
- The opinion relies on existing authorities (including Privy Council decisions) and distinguishes the contrary Madras decision on its facts; the Court did not purport to lay down a novel or general rule beyond applying established principles, and the decision operates to permit further fact-finding at trial rather than to declare a new broad legal doctrine beyond what is discussed.
Note: This summary is based exclusively on the material contained in the provided opinion. No facts, arguments, or holdings beyond those expressly stated in that opinion have been added.
1. This appeal arises in a suit brought by the respondents for an alleged balance of purchase money and interest thereon.
2. On the 21st of July, 1909, the respondents sold some zamindari property to the appellant for Rs. 15,000. Part of the property had been sold in execution of a decree and if, was intended that the appellant should get the execution sale set aside. But it wag discovered that according to order XXI, Rule 89, as then interpreted, neither the vendors nor the purchasers could get the sale set aside. Accordingly the appellant relinquished her interest in the property by a registered deed. The respondents then raised on a mortgage of the property in favour of one Parsotam Das, a sum sufficient to pay oil the decree-holder and in due course the sale was set aside. On the 28th of October, 1909, the respondents executed in favour of the appellant a deed whereby they sold to her the property which, had been the subject of the earlier sale together with some other property for the stated sum of Rs, 40,000. The deed contains a recital that the respondents have received the whole of this sum and have out of it paid off Parsotam Das and discharged other debts. Before the Sub-Registrar they received a sum of Rs. 2,400, and acknowledged the receipt of Rs. 37,600. On the same day they gave the appellant a receipt for Rs. 37,600.
3. The present suit was instituted on the 3rd of November, 1912, the last day of limitation. The respondents allege that they were obliged to sell the property in order to raise some cash and pay off some creditors; that certain persons acting on behalf of the appellant induced them to acknowledge the receipt of the consideration in full and to sign the receipt for Rs. 37,600, by representing that they would, after the registration of the deed, pay off certain creditors of the respondents and make over to them proof of the payment and account for the balance, but they bad paid only Rs. 11,726, to Parsotam Das. Giving the appellant credit for that amount, for Rs. 1,000, spent in connection with the execution of the deed and for Rs. 2,400, paid at registration, the respondents claimed a decree for the balance Rs. 24,874, and interest thereon. The appellant's defence was that the real consideration for the sale was Rs. 15,126, made up of the three sums of Rs. 11,726, Rs. 1,000, and Rs. 2,400, mentioned above and that the property was not worth more. She said that Parsotam Das wished to buy the property, hut for reasons of their own the respondents did not wish to sell to him; therefore they gave out that they were selling the property for Rs. 40,000, a sum which Parsotam Das was not prepared to pay, and they induced the appellant to agree to this sum being entered in the sale-deed in order that Parsotam Das might have no cause for complaint.
4. The question for decision is whether the appellant is entitled to produce oral evidence in proof of her allegations. The court below has hold that she is not.
5. On behalf of the appellant it was contended that her allegations, if proved, would entitle her to have the sale deed rectified or f rescinded, also that it was a case of mistake, therefore the case fell within the first proviso to Section 92 of the Evidence Act. It was also urged that all the terms of the contract had not been embodied in the deed, thefore Section 91 of the Act, and consequently Section 92 also, did not] apply, and we were referred to the case of Jumna Doss v. Srinath Roy (1886) I. L. R. 17 Calc., 176 (note). But none of these arguments was seriously pressed and it seems unnecessary to consider them.
6. The main contention of the learned advocate for the appellant was that if the respondents are entitled, as they undoubtedly are, to go behind the recital and admission in the deed and prove that the entire consideration has not been paid it is open to the appellant to produce oral evidence as to the true nature and extent of the consideration. Among the cases relied upon were those of Shah Mukhun Lal v. Baboo Sri Kishen Sing (1868) 12 Moo. I.A 157 (185). Lala Himmat Sahai Singh v. Llewhellen (1885) I. L. R. 11 Calc. 486. Hukumchand v. Hiralal (1876) I. L. R. 3 Bom. 159. Indarjit v. Lal Chand (1895) I. L. R. 18 All. 168. affirmed on appeal in I. L. R. 22 All. 370 Kailash Chandra Neogi v. Harish Chandra Biswas (1900)5 C. W. N. 158. Nathu Khan v. Sewak Koeri (1911) 15 C. W. N. 408 Muhammad Yusuf v. Muhammad Musa Weekly Notes 1907 p. 181 and Hanif-un-nissa v. Faiz un-nissa (1911) I. L. R. 33 All. 340.
7. The first of these cases was a suit for redemption of a mortgage purporting to make interest payable at the rate of 9 per cent. The plaintiff put forward other documents executed at about the same time and proved that they evidenced a single transaction and were a contrivance to evade the usury laws. He thus put himself in a position to redeem the mortgage before the date fixed by one of the documents. He wished, however, to have the interest calculated at 9 per cent. The defendants pleaded that the rate agreed upon was 12 per cent. Their Lordships of Privy Council dealing with this matter said:
"The rules of evidence and the law of estoppel forbid any addition to, or variation from, deeds or written contracts. The law, however, furnishes exceptions to its own salutary protection, one of which is, when one party, for the advancement of justice, is permitted to remove the blind which hides the real transaction, as, for instance, in cases of fraud, illegality and redemption, in such cases the maxim applies that a man cannot affirm and disaffirm the same transaction, show its true nature for his own relief and insist upon its apparent character to prejudice his adversary."
8. In the second case a deed recited payment of Rs, 2,000, in a lump sum to the executant who, however, sued for recovery of Rs. 1,850, alleging that only Rs. 150 had boon paid. The defendant admitted that no more than Rs. 150 had been paid and that Rs. 850 were still due. As regards the remaining sum of Rs. 1000, he was allowed to prove by oral evidence an agreement to the effect that it was to be retained by him on account of a debt due to him by a relative of the plaintiff. The court held that it was under the first proviso to Section 92 of the Evidence Act that the plaintiff was entitled to go behind the recital and prove that only Rs, 150 had been paid, and on the strength of the passage cited above from the judgment of their Lordships of the Privy Council they went on to hold that the defendant was entitled to prove that the consideration was different from that stated in the deed.
9. In the third case the defendant challenged the title of the plaintiff, who relied upon a sale deed purporting to transfer the property to him in consideration of Rs. 100, already received in cash. The plaintiff was allowed to meet the defendant's case by proving that the consideration consisted of Rs. 63-12-0 due on a bond and Rs. 36-4-0 paid in cash. The court was of opinion that there was no real variance between the statement in the deed and the statements of the plaintiffs witnesses, but in the course of their judgment they observed that Section 92 of the Evidence Act does not prevent a party to a contract from showing that there was no consideration or that the consideration was different from that described in the contract.
10. In the fourth case there was a recital in the sale deed that the whole of the consideration money had been received; but their Lordships of the Privy Council ruled that in such a case it was open to the vendor to prove that no consideration had passed, and they held that evidence was admissible to prove an agreement that the consideration money should remain in the hands of the purchaser for certain purposes and to be accounted for later. In the judgment of the High Court, in a passage which perhaps went further than was necessary, it was said:
"If it is open to a party, as is undoubtedly the case, to show, notwithstanding a recital in the deed, that no consideration passed or that the actual consideration was different from that stated in fine deed, it is in our opinion open to a party to prove under what circumstances the payment of consideration was postponed and what was the mode agreed upon as to the payment of it."The second and third cases above mentioned were referred to in this connection.
11. The fifth case was a suit to set aside a sale deed on the ground that there had been no consideration for it and that it had been obtained by unfair means. The deed recited that Rs. 500 had been received in cash. The plaintiff gave evidence that nothing had deen paid and the defendant was permitted to adduce evidence that there was some, and that ample, consideration for the transaction, though not the amount stated in the deed. The court seems to have been of opinion that it was under the first proviso to Section 92 of the Evidence Act that the plaintiff was entitled to go behind the recital, and it was laid down by both the learned Judges that in such a case the other party was entitled to prove that there was some consideration for the deed. The Chief Justice relied upon the second and third cases mentioned above and Banerji, J. referred to one of them with approval.
12. In the sixth case the plaintiff sued for Rs. 800 the consideration stated in a kabala and therein acknowledged to have been received. The plaintiff proved that it had not been paid and the defendant was allowed to prove that the stated consideration was fictitious and that the real consideration was services rendered by the defendant.
13. In the seventh case two sisters had agreed to exchange properties. Each executed in favour of the other a sale deed in which the consideration was stated to be Rs. 1,000 and payment in full was acknowledged. In a suit by one of the sisters for the amount of the consideration the defendant was allowed to prove that the real consideration was the property given in exchange.
14. In the eighth case the plaintiff had executed in favour of the defendant what purported to be a sale deed of property for Rs. 60,000 the receipt of which was acknowledged in the deed. The plaintiff on certain grounds asked that the deed should be set aside and in the alternative claimed a decree for the sum of Rs. 60,000. She proved that the money had not been paid and the defendant was allowed to prove that the executant had intended to make a gift of the property and had never intended to take any part of the alleged consideration.
15. The respondents rely upon the decision of the Madras High. Court in Adityam Iyer v. Ramakrishna Aiyar (l913) 25 M. L. J. 602. which will be referred to later. As regards the cases relied upon by the appellant they urge that the first of them merely lays down one of the rules subsequently embodied in Section 92 of the Evidence Act and that the passage quoted has no application to the facts of this case, inasmuch as the respondents are not seeking to remove the blind which hides the real transaction, but wish merely to contradict a statement of fact contained in the deed that the 2nd, 3rd, 4th, 6th and 7th cases are not authorities for the proposition that a party may prove by oral evidence that the consideration for a sale is less than or different from that stated in the deed but are only instances of parties to deeds being allowed to show that the consideration passed in a form other than that stated in the deed; and that if the fifth case goes further than that it was wrongly decided, As regards the eighth case, the respondents contend that it was a case of facts being proved which would invalidate a document within the meaning of the first proviso to Section 92 of the Evidence Act.
16. It is true, no doubt, that several of the cases relied upon by the appellant were case in which a party to a deed sought to prove that the consideration passed in a form different from that stated in the deed, not to prove that the amount of the consideration was different in amount from that stated in the deed. But in the fifth case the defendant seems to have been allowed to prove that the amount of the consideration was different from that stated in the deed, and in the eighth case the defendant was permitted to prove that the consideration did not pass at all and was never intended to pass. In some of the cases the decision rests upon a ground which applies as much to one kind of case as to the other, namely, that if one party to a deed alleges and proves that the consideration the receipt of which was acknowledged in the deed did not pass, the case falls within the first proviso to Section 92 of the Evidence Act and the other party is at liberty to prove what the real consideration was. It appears to me that it must have been upon this ground that their Lordships of the Privy Council admitted the evidence tendered by the defendant in the eighth case.
17. The Madras case relied upon by the respondents is distinguishable. It was a suit upon a mortgage. The defence set up was discharge, it being contended that the discharge of the mortgage was part consideration for the sale of certain properties to the mortgagor some years after the mortgage. The discharge of the mortgage was not mentioned in the deed of sale, but the defendant sought to prove the arrangement by oral evidence. The court hold that such evidence was not admissible. It was not a case in which one party denied receipt of consideration acknowledged by him in a deed and the other party sought to prove that the true consideration was other than that stated in the deed.
18. On the authorities I would hold that as the respondents have alleged and proved that the whole of the consideration, receipt of which is acknowledged in, this deed, did not pass, the appellant is entitled to produce oral evidence in support of her allegations, and as the court below did not allow her to produce such evidence, I would remand the case for a fresh trial.
Pramada Charan Banerji, J.
19. This was a suit to recover unpaid purchase money. The plaintiffs executed a sale deed in favour of the defendant appellant on the 28th of October, 1909. The amount of consideration for the sale is stated in the sale-deed to be Rs. 40,000. The plaintiffs state that they have received out of this sum Rs. 21,726 and that the balance is due. The defendant contended that the amount of consideration specified in the sale-deed was fictitious and that the real amount agreed to be paid was that which the plaintiffs admitted to have received. The question to be determined is whether, in view of the provisions of Section 92 of the Evidence Act, the defendant appellant is entitled to produce oral evidence in support of her allegation.
20. A large number of rulings have been cited by the respective parties, but I deem it unnecessary to consider and discuss them, as I am of opinion that the matter is concluded by the recent decision of their Lordships of the Privy Council in Hanif-un-nissa v. Faiz-un-nissa (1911) I. L. R. 33 All. 340. In that case the plaintiff, who had executed a document which on the face of it was a sale-deed for Rs. 60,000, sought to have it cancelled on various grounds and in the alternative claimed the Rs. 60,000. The defendants alleged that the transaction was in fact a gift and not a sale as it purported to be. This Court held that the defendants were precluded by the provisions of Section 92 of the Evidence Act from proving that the transaction was different from that which it purported to be and that it was in reality a gift. Their Lordships of the Privy Council reversed this decision and held that oral evidence could be given by the defendants to prove the real nature of the transaction. Apparently their Lordships were of opinion that the case would come within the first proviso to Section 92. I am unable to distinguish the present case from the principle of the ruling above mentioned. In view of that ruling I must hold that the appellant is entitled to produce oral evidence to prove her allegations. As the court below did not permit her to produce such evidence the case must be remanded to that court.
21. BY the Court.---The order of the Court is that the appeal be allowed, the decree of the court below be set aside and the case be remanded to the court below with directions to re-admit it under its original number in the register and dispose of it according to law, after allowing the parties to adduce such evidence as they may bring forward. The costs hitherto incurred will be costs in the cause.
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