YOGENDRA PRASAD SINGH (DEAD) THR LRS vs. RAM BACHAN DEVI AND ORS.

2023 INSC 658 NON­REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.10412 of 2013  Yogendra Prasad Singh (Dead)  through LRs …..Appellants                                 Versus Ram Bachan Devi & Ors.        …..Respondents J U D G M E N T Abhay S. Oka, J. FACTUAL BACKGROUND 1. The appellants are  the legal  representatives of the   original   plaintiff.     For   the   sake   of   convenience, parties are hereinafter referred to with reference to their status before the Trial Court.  The Trial Court decreed the Suit which has been reversed in appeal. 2. The   plaintiff   is   the   son­in­law   of   the   first defendant.     The   first   defendant   has   four   daughters. One of the daughters, Sachita Devi has been married to the plaintiff.  The second defendant is another daughter Signature Not Verified Digitally signed by Anita Malhotra Date: 2023.07.31 15:40:09 IST Reason: of   the   first   defendant   who   is   married   to   one   Komal Singh. C.A.No.10412 of 2013 Page 1 of 12 3. The  first  defendant   was   heavily   indebted.     He had borrowed money from various persons by executing mortgage deeds, hand notes, etc.  As the first defendant was unable to pay debts, he decided to sell the suit property.   Accordingly, he executed a registered Sale th Deed on 04  February 1963 in favour of the plaintiff for consideration of Rs.10,000/­.  According to the case of the plaintiff, he was placed in possession of the suit property   and   started   cultivating   the   same.     His contention was that there was an absolute sale under th the Sale Deed dated 04  February 1963 (for short, ‘the Sale Deed’). 4. Even according to the case of the plaintiff, a part of   the   consideration   was   to   be   paid   by   him   to   the creditors   of   the   first   defendant.     In   the   plaint,   the plaintiff has described the steps taken by him to clear the loans repayable by the first defendant and money paid by him from time to time to various persons in that behalf.  His contention is that he paid off the debt as   mentioned   in   the   Sale   Deed.     The   plaintiff   has contended that the first defendant being his father­in­ law, collected the registered Sale Deed from the office of the   Sub­Registrar   and   has   kept   the   same   in   his custody. 5. The first defendant executed a registered Deed of th Cancellation  dated 15   June 1967 in  respect  of  the C.A.No.10412 of 2013 Page 2 of 12 cancellation   of   the   Sale   Deed.     The   plaintiff   was admittedly   not   a   signatory   to   the   said   Deed   of Cancellation.  Thereafter, the first defendant purported th to execute a Gift Deed dated 12   January 1968 (for short ‘the Gift Deed’) in respect of the suit property in favour   of   the   second   defendant.     The   case   of   the plaintiff is that though he was all along in possession, on the basis of the order passed in proceedings under Section 145 of the Code of Criminal Procedure, 1973 he was   illegally   dispossessed   from   the   suit   property. Therefore, the plaintiff filed a  Suit  for declaration of title.   The plaintiff also claimed a declaration that the Gift Deed is forged.  The plaintiff prayed for a decree for possession of the suit property. 6. The basic contention of the first defendant in his written statement was that by the Sale Deed, absolute sale was not effected.   It is contended that out of the consideration of Rs.10,000/­, the plaintiff had agreed to pay   a   sum   of   Rs.6,875/­   for   redeeming   the   10 mortgages made by the first defendant.   The balance amount of Rs.3,125/­ was to be paid on the exchange of equivalents ( ta khubzul badlain ).  The contention of the first defendant is that in fact the mortgages were redeemed by him and therefore, he was in possession of the   mortgage   deeds.     His   contention   is   that   as   no consideration   was   passed   under   the   Sale   Deed,   the plaintiff has not acquired any right, title or interest in C.A.No.10412 of 2013 Page 3 of 12 the suit property. 7. The Trial Court after in­depth consideration of the evidence on record, concluded that the plaintiff had acquired ownership in respect of the suit property on the basis of the Sale Deed.  It was held that the Deed of th Cancellation dated 15   June 1967 being a unilateral document was not valid.  The Trial Court held that the remedy of the first defendant was to invoke Section 31 of the Specific Relief Act, 1963 and seek cancellation of the   Sale   Deed.     The   Trial   Court   also   held   that   the second   defendant   did   not   acquire   any   right,   title   or interest on the basis of the Gift Deed executed by the first   defendant.     The   Trial   Court   accepted   the   case made out by the appellant that the liabilities of the first defendant were discharged by him. In   the   appeal   against   the   decree   of   the   Trial 8. Court preferred by the original defendants, the High Court interfered with the impugned judgment and held that   as   consideration   was   not   paid   under   the   Sale Deed, the plaintiff did not acquire any right, title or interest in respect of the suit property.  The High Court did   not   accept   the   plaintiff's   case   that   he   had discharged the loan liability of the first defendant.  The Trial Court had accepted that the plaintiff had paid a cash amount of Rs.3,125/­ to the first defendant at the time of the exchange of equivalents.  The said case was C.A.No.10412 of 2013 Page 4 of 12 disbelieved   by   the   High   Court.     Therefore,   the   High Court proceeded to set aside the decree of the Trial Court and dismissed the Suit. SUBMISSIONS 9. The   learned   counsel   appearing   for   the   legal representatives of the plaintiff submitted that on the execution of the Sale Deed, right, title and interest of the first defendant in the suit property were passed on to   the   plaintiff.     He   submitted   that   there   was substantial evidence on record to show the discharge of liabilities of the first defendant by the plaintiff.  Inviting our   attention   to   the   recitals   in   the   Sale   Deed,   he submitted that it is clearly recorded that the title and possession passed on to the plaintiff.   He submitted that the first defendant being the father­in­law of the plaintiff had retained the Sale Deed.   Considering the relationship   between   the   plaintiff   and   the   first defendant, it is not unnatural that the plaintiff did not object   to   the   custody   of   the   Sale   Deed   by   the   first defendant.     He   submitted   that   the   findings   of   fact recorded by the High Court regarding the payment of liabilities   of   the   first   defendant   by   the   plaintiff   are completely   erroneous.     He   submitted   that   there   is nothing   abnormal   about   the   possession   by   the   first defendant of the mortgage deeds.  Though the mortgage money was paid by the plaintiff, the mortgage deeds were handed over to the first respondent as he was the C.A.No.10412 of 2013 Page 5 of 12 mortgagor. 10. The learned counsel appearing for the first and second defendants heavily relied upon a decision of this Court in the case of   v.  Janak Dulari & Anr. Kapildeo 1 Rai & Anr. .  He submitted that this Court in the said decision has taken note that the practice of  ta khubzul badlain  (of title passing on the exchange of equivalents) is   prevalent   only   in   Bihar.     He   submitted   that   this Court held that the practice of   ta khubzul badlain   in Bihar recognizes that a duly executed Sale Deed will not operate as a transfer  in praesenti  but postpones the actual transfer of title from the time of execution and registration   of   the   deed   to   the   time   of   exchange   of equivalents.  In such a case, the title on the basis of the Sale   Deed   will   pass   to   the   purchaser   only   after   the entire amount is paid by the purchaser.   Inviting our attention to the recitals in the Sale Deed, he submitted that it was a transaction to which the practice of   ta khubzul badlain  was applicable.  He submitted that as the title in the Suit property never passed on to the plaintiff, the first defendant rightly executed a Deed of Cancellation of the Sale Deed.  He submitted that there is no reason to find fault with the reasoning adopted by the High Court.  11. The   learned   counsel   appearing   for   the   legal 1 (2011) 6 SCC 555 C.A.No.10412 of 2013 Page 6 of 12 representatives of the plaintiff submitted that in very difficult times faced by the first defendant, the plaintiff, his son­in­law, took the risk of taking the suit property, which was the subject matter of encumbrances. OUR VIEW A sale deed of an immovable property is executed 12. in   accordance   with   Section   54   of   the   Transfer   of Property Act, 1882 (for short, ‘the 1882 Act’).   There cannot be any dispute that normally, on the execution of a registered Sale Deed by the owner of the property, the title in the property subject matter of the Sale Deed stands transferred to the purchaser.   Considering the principles laid down in sub­section (4)(b) of Section 55 of the 1882 Act, the seller will have a charge over the property   subject   matter   of   the   sale   for   unpaid consideration and he can enforce the charge by filing a suit. 13. The entire case of the defendants is based on the decision of this Court in the case of   Janak Dulari 1 Devi . In paragraph 20 of the said decision this Court held thus : “ 20.  We have referred to several decisions of the Patna High Court in detail to demonstrate the  existence   of   the  established   practice   of exchanging equivalents   ( ta khubzul badlain ). The effect of such transactions in Bihar is that even though the duly executed and registered sale deed may recite that  the C.A.No.10412 of 2013 Page 7 of 12 sale consideration has been paid, title has been transferred and possession has been delivered   to   the   purchaser,   the   actual transfer of title and delivery of possession is postponed from the time of execution of the sale deed to the time of exchange of the   registration   receipt   for   the consideration,   that   is,   ta   khubzul . ” badlain (emphasis added) Paragraph 24 of the decision reads thus :  “ 24.  We hasten to add that the practice of  ta khubzul badlain  (of title passing on exchange of   equivalents)   is   prevalent   only   in   Bihar. Normally, the recitals in a sale deed about transfer of title, receipt of consideration and delivery of possession will be evidence of   such   acts   and   events;   and   on   the execution   and   registration   of   the   sale deed, the sale would be complete even if the sale price was not paid, and it will not be   possible   to   cancel   the   sale   deed unilaterally. The exception to this rule is stated   in  Kaliaperumal  [(2009)   4   SCC 193   :   (2009)   2   SCC   (Civ)   101]   .   The practice   of  ta   khubzul   badlain  in   Bihar recognises that a duly executed sale deed will   not   operate   as   a   transfer  in praesenti  but   postpones   the   actual transfer   of   title,   from   the   time   of execution and registration of the deed, to the time of  exchange of equivalents , that is,   registration   receipt   and   the   sale consideration,   if   the   intention   of   the parties was that title would pass only on C.A.No.10412 of 2013 Page 8 of 12 payment of entire sale consideration.  As a result,   until   and   unless   the   duly   executed and   registered   sale   deed   comes   into   the possession of the purchaser, or until the right to receive the original sale deed is secured by the purchaser by obtaining the registration receipt, the deed of sale remains merely an agreement to be performed and will not be a completed sale. But in States where such a practice   is   not   prevalent,   possession   of registration receipt by the vendor, may not, in the absence of other clear evidence, lead to an inference   that   consideration   has   not   been paid   or   that   title   has   not   passed   to   the purchaser   as   recited   in   the   duly   executed deed of conveyance. Where the purchaser is from   an   outstation,   the   vendor   being entrusted   with   the   registration   receipt,   to collect the original sale deed and deliver it to the purchaser, is common. Be that as it may.” (emphasis added) Thus, this Court held that normally, on the execution and   registration   of   a   sale   deed   containing   recitals regarding the payment of consideration and delivery of possession, the sale is complete even if the sale price is not paid and, therefore, it will not be possible to cancel the sale deed in its entirety.  However, the exception to the said rule is the practice of  ta khubzul badlain .  The use of the expression  ta khubzul badlain  in a sale deed by itself will not be determinative of the true nature of the transaction. It cannot be read in isolation. All the terms and conditions and recitals in the document will have to be considered to decide the real nature of the C.A.No.10412 of 2013 Page 9 of 12 transaction. We have, therefore, examined the recitals in the 14. Sale Deed from the translated English version of the same   produced   by   the   appellants.     The   English translation shows that – (a) There   is   a   specific   recital   that   the   first defendant has transferred the possession of the suit property to the plaintiff in the capacity of the owner   and   that   the   plaintiff   will   become   the owner of the property;  (b) It also mentions that from the date of Sale Deed, the first defendant has no claim or title in respect of the suit property or regarding its price; (c) Nothing   was   due   and   payable   by   the plaintiff   to   the   first   defendant   as   the   first defendant had received consideration; and  (d)     The plaintiff who was the son­in­law of the first   defendant   took   the   suit   property   with encumbrances when the first defendant was in trouble due to liabilities.    15. Therefore,   the   use   of   the   words   “khubzul badlain”, in the facts of the case, cannot be conclusive. It is true that the Sale Deed refers to various mortgages executed by the first defendant for getting money and the   recitals   indicate   that   the   plaintiff   had   agreed   to C.A.No.10412 of 2013 Page 10 of 12 discharge   the   said   loan   liabilities.     But,   there   is   a specific   recital   in   the   Sale   Deed   that   the   title   and possession   in   the   property   has   been   passed   to   the plaintiff.   These recitals regarding the transfer of title and   possession   are   very   crucial   which   cannot   be brushed aside. On   overall   reading   of   the   Sale   Deed,   it   is 16. apparent that under the Sale Deed, the entire right, title   and   interest   of   the   first   defendant   in   the   suit property has been transferred to the plaintiff by the said sale deed.  At the highest, as per sub­section (4)(b) of Section 55 of the 1882 Act, the first defendant was entitled to have a charge on the suit property for the amount of consideration  which was not paid by the plaintiff.   Even this provision may not help the first defendant.   The reason is that the plaintiff has taken over the suit property with liabilities as set out in the Sale Deed.   The creditors of the first defendant can, therefore, proceed against the suit property.  Once we hold   that   the   title   and   ownership   passed   on   to   the plaintiff on the date of Sale Deed, it is not necessary to go   into   the   question   whether   the   appellant   has discharged liabilities of the loan especially when the first or second defendants did not file a counter­claim for payment of the consideration payable under the Sale Deed. C.A.No.10412 of 2013 Page 11 of 12        There is one more aspect of the case. If it was 17. the   case   of   the   first   defendant   that   there   was   no transfer of title under the said Sale Deed, there was no reason for him to unilaterally execute a document of cancellation   of   the   sale   deed.   In   any   case,   such   a unilateral   cancellation   deed   was   not   binding   on   the plaintiff as he was not a consenting party. The second defendant will not get any right by virtue of the gift deed as the first defendant had no transferable title. As the ownership   of   the   plaintiff   is   proved,   the   decree   for possession   must   follow.   There   was   no   counter­claim made   by   the   first   or   second   defendant   for   claiming alleged unpaid consideration.  Therefore, the appeal succeeds.   The impugned 18. judgment and order passed by the High Court of Patna in First Appeal No.334 of 1988 is quashed and set aside and the decree passed by the Trial Court in Title Suit No.142 of 1977 is restored. 19. The appeal is allowed on the above terms with no order as to costs. ……..………………..J. [ABHAY S. OKA] ..……………………..J. [RAJESH BINDAL] New Delhi Dated : July 31, 2023. C.A.No.10412 of 2013 Page 12 of 12