The High Court of Orissa dismissed an appeal against confirming judgments upholding a sale deed. The court held that title passed upon registration of the sale deed despite non-payment of balance consideration, relying on statutory provisions and prior precedents regarding the intention of parties and the nature of sale.
The appeal was dismissed; no costs awarded.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
HIGH COURT OF ORISSA: CUTTACK
S.A. No.242 of 1987
From the judgment and decree dated 14.7.87 and 18.7.87 respectively passed by Sri D.L.C.K. Patnaik, learned Addl. District Judge, Jajpur in T.A. No.7 of 1984/61 of 1987 confirming the judgment and decree dated 9.1.84 and 21.1.84 respectively passed by Sri E.V. Rao, learned Addl. Munsif, Jajpur Road in T.S. No.89 of 1983 (T.S. No.234/81).
Samanta Umesh Prasad Dhir and others …………… Appellants
---versus—
Sahadev Sahoo ……………… Respondent
For Appellants : Mr. Ram Chandra Rath, Advocate For Respondent : Mr. Manoj Kumar Agarwal, Advocate
J U D G M E N T
P R E S E N T:
THE HON’BLE DR. JUSTICE A.K. RATH
---------------------------------------------------------------------------Date of Hearing :05.05.2018 │ Date of Judgment:11.05.2018
Dr. A.K. Rath, J. This is plaintiffs’ appeal against a confirming judgment. The suit was for declaration of title and confirmation of possession.
02. The case of the plaintiffs was that they are owners of the suit lands. The defendant was their god-son. Taking advantage of the relationship, the defendant persuaded them to allow him to cultivate the suit lands to protect them from the clutches of intruders on execution of the document in his favour. In good faith, they agreed to execute a registered agreement with the condition that the defendant would cultivate the same for a period of three
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years on payment of Rs.1000/- per year towards Rajbhag to them. It was further agreed that the defendant would pay Rs.400/- in advance to be adjusted from the Rajbhag of the plaintiffs. Accordingly, they with their son Umesh executed the document on 6.3.74 in favour of the defendant. The document was scribed by the defendant. They signed on it and their son attested it. The contents thereof were not read over to them. The ticket for return of the document was retained with them. The defendant agreed to pay advance of Rs.400/- within a few days. The defendant took possession of the suit lands on the very day. The defendant had remitted Rs.50/- only. The defendant did not pay the rest amount. While matter stood thus, on 27.5.77 the plaintiff no.1 obtained the original deed from the Sub-Registrar’s Office and came to know that the same was out and out a sale deed, but not agreement. Thereafter, they cancelled the deed on 22.6.77 and took possession of the suit lands. The defendant threatened to create troubles in their possession. With this factual scenario, they instituted the suit seeking the reliefs mentioned supra.
03. The defendant entered contest and filed written statement denying the assertions made in the plaint. The specific case of the defendant was that the plaintiffs resided at a distance of about 30 miles away from the suit lands. Lot no.1 of the suit plot was full of shrubs. The same was Anabadi land. Lot no.2 was arable. The suit lands were not profitable. The plaintiffs intended to sale the same. In 1974, he approached them for purchase of the suit lands. The plaintiffs agreed to sell the same for a consideration of Rs.1000/- and received Rs.415/- towards part consideration from him. The plaintiffs executed the registered sale deed dated 6.3.1974 in his favour and delivered possession. The balance consideration of Rs.585/- was agreed to be paid at the time of endorsement of ticket
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in his favour, though the same was never intended to operate against passing of title. In the last part of 1974, he paid arrear rent of Rs.335/- to the plaintiffs and adjusted it towards balance consideration. The plaintiff no.1 promised to come to his village and agreed to clear up, if any other arrear rent from out of the remaining consideration of Rs.250/- and to endorse the tickets in his favour. The plaintiff no.1 did not keep his promise. He ascertained that a sum of Rs.200/- was in arrears upto 1973-74 and paid the same adjusting towards the balance consideration. A sum of Rs.50/was due to be paid to the plaintiffs towards consideration. The same was remitted to the plaintiff no.1 by money order. In December, 1975, he approached the plaintiffs for endorsing the ticket in his name, but they took the plea that the same was lost in the devastating floods of 1975. The plaintiffs’ son Umesh approached him in the year 1981 for payment of extra money, but he refused to pay. The plaintiffs fraudulently cancelled the sale deed. The cancellation deed does not affect his title and possession of the suit lands.
04. On the interse pleadings of the parties, learned trial court struck five issues. Parties led evidence, oral and documentary, to substantiate their case. Learned trial court dismissed the suit with the findings that the plaintiffs had no authority to cancel the sale deed, Ext.3 by means of Ext.1. The plaintiffs failed to prove that the document in question was obtained by playing fraud. The deed was executed by the plaintiffs intending to sell the suit land. Title had been passed under the sale deed to the defendant. The defendant mutated his name and paid rent. The defendant was in possession since 1974. The unsuccessful plaintiffs filed T.A. No.7 of 1984 in the court of the learned Additional District Judge, Jajpur, which was eventually dismissed. It is apt to mention here that during pendency
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of the appeal, the appellant no.1-plaintiff no.1 died. The legal heirs had been substituted.
05. The second appeal was admitted on the substantial questions of law enumerated in ground nos.7(A), (B) and (C) of the appeal memo. The same are:
“7(A) Whether both the courts below are justified in holding that title passed to the defendant under the sale deed (Ext.3) in view of their concurrent findings that full consideration money under the sale deed was not paid and specially when the recital of the sale deed was to the effect that on receipt of the consideration money the plaintiffs would sell the suit land to the defendant and make him the full owner thereof ?
(B) Whether both the courts below are correct in construing the transaction to be one of sale in absence of payment of consideration which was a condition precedent for passing of title ?
(C) Whether mutation entries conferred title upon the defendant in absence of a valid title conferred under Ext.3 upon him ?”
06. Heard Mr. Ram Chandra Rath, learned counsel for the appellants and Mr. Manoj Kumar Agarwal, learned counsel, on behalf of Mr. D.P. Dhal, learned counsel for the respondent.
07. Mr. Rath, learned counsel for the appellants, submitted that since the entire consideration was not paid, title had not passed under Ext.3. The recital of the sale deed shows that on payment of consideration, title would pass. In the absence of payment of consideration, which was a condition precedent, title would not pass.
08. Per contra, Mr. Agarwal, learned counsel for the respondent, submitted that the entire consideration had been paid. There is no provision in the Registration Act for cancellation of sale deed. The recital of the sale deed makes it clear that title has passed.
09. In Kaliaperumal vs. Rajagopal and another, (2009) 4 SCC 193, the apex Court held that s ale is a transfer of ownership for
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a price. In a sale there is an absolute transfer of all rights in the properties sold. No rights are left in the transferor. The price is fixed by the contract antecedent to the conveyance. Price is the essence of a contract of sale. There is only one mode of transfer by sale in regard to immovable property of the value of Rs.100/- or more and that is by a registered instrument. Payment of entire price is not a condition precedent for completion of the sale by passing of title, as Section 54 of the Transfer of Property Act, 1882 (“the Act”, for short) defines “sale” as “a transfer of ownership in exchange for a price paid or promised or part-paid and part-promised.” If the intention of parties was that title should pass on execution and registration, title would pass to the purchaser even if the sale price or part thereof is not paid. In the event of non-payment of price (or balance price as the case may be) thereafter, the remedy of the vendor is only to sue for the balance price. He cannot avoid the sale. He is, however, entitled to a charge upon the property for the unpaid part of the sale price where the ownership of the property has passed to the buyer before payment of the entire price, under Section 55(4)(b) of the Act. Normally, ownership and title to the property will pass to the purchaser on registration of the sale deed with effect from the date of execution of the sale deed. But this is not an invariable rule, as the true test of passing of property is the intention of parties. Though registration is prima facie proof of an intention to transfer the property, it is not proof of operative transfer if payment of consideration (price) is a condition precedent for passing of the property. The answer to the question whether the parties intended that transfer of the ownership should be merely by execution and registration of the deed or whether they intended the transfer of the property to take place, only after receipt of the entire consideration, would depend on the intention of the
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parties. Such intention is primarily to be gathered and determined from the recitals of the sale deed. When the recitals are insufficient or ambiguous the surrounding circumstances and conduct of parties can be looked into for ascertaining the intention, subject to the limitations placed by Section 92 of Evidence Act.
10. In Michhu Kuanr and others vs. Raghu Jena and others, AIR 1961 Ori.19, this Court held that once by the registered sale deed title had passed to the vendees, the subsequent deed of cancellation by the vendor does not nullify the effect of the already completed sale deed. If there is a clear conveyance that the executant conveys title in favour of the vendee from the date of the execution of the document and the recital regarding consideration comes later independently of the clause regarding title, then the title passes independent of the question of consideration.
11. In Umakanta Das and another vs. Pradip Kumar Ray and others , AIR 1986 Ori.196, this Court held that if the term in the sale deed is not ambiguous then any external aid to find out the true intention of the parties cannot be availed of and the narration in the document would be the sole determining feature. If the intention of the parties is clear as found from the recitals, passing of title is in presenti and not kept in abeyance till full payment of consideration.
12. Reverting to the facts of this case and keeping in view the law as stated supra, this Court finds that both the courts concurrently held that Ext.3 is a sale deed. No fraud was played on the plaintiffs. The learned lower appellate court held that the plaintiffs failed to prove that they had executed Ext.3 without receipt of part consideration. The plaintiffs received part consideration of Rs.415/- besides Rs.50/- by money order. There is no perversity in the said findings.
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13. The recitals of Ext.3 are clear and unambiguous. On a bare perusal of the sale deed, Ext.3, it is evident that on the date of execution of the sale deed, title has passed. The substantial questions of law are answered accordingly.
14. In the wake of aforesaid, the appeal, sans merit, deserves dismissal. Accordingly, the same is dismissed. No costs.
………………………………. Dr. A.K. Rath,J.
Orissa High Court, Cuttack The 11th May, 2018/Basanta
3 issues framed by the court
Whether title passed to the defendant under the sale deed in view of findings that full consideration money was not paid?
Whether the transaction should be construed as a sale in absence of payment of consideration which was a condition precedent for passing of title?
Whether mutation entries conferred title upon the defendant in absence of a valid title conferred under the sale deed?
Colour shows how this judgement treated each authority
Kaliaperumal vs. Rajagopal and anotherDistinguished¶30
(2009) 4 SCC 193 · Who else cites this
Michhu Kuanr and others vs. Raghu Jena and othersRelied on¶35
AIR 1961 Ori.19 · Who else cites this
Umakanta Das and another vs. Pradip Kumar Ray and othersRelied on¶36
AIR 1986 Ori.196 · Who else cites this
3 provisions across 2 enactments
Samanta Umesh Prasad Dhir and others
Sahadev Sahoo
A.K. Rath
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
A.K. Rath
Parties & counsel
