Illiterate 82-Year-Old Wins Sale-Deed Challenge, But Madras HC Orders Him To Pay Lender Rs5 Lakh With 6% Interest

In brief

The question

1. Whether the first appellate court was right to dismiss the suit despite the appellant’s contention that title could not pass without a properly registered sale deed under Section 54 of the Transfer of Property Act.

The court held

The Court answered all substantial questions of law in the plaintiff’s favour and allowed the second appeal.

It also directed

It directed the plaintiff to pay the defendant ₹5,00,000, carrying interest at 6% per annum from 20 June 2023 until payment; it made no order as to costs and closed the connected miscellaneous petition.

The judgment does not separately set out the precise terms of the decree granting the suit’s declaratory and cancellation relief.

01Facts

The plaintiff claimed ownership of the suit property under a 1967 partition deed.

He alleged that he borrowed ₹1,00,000 from the defendant in 2013 and executed a registered mortgage, retaining possession.

He said that, when repaying the loan in January 2016, he believed he was signing a discharge receipt, but the defendant fraudulently procured a sale deed in her favour.

The defendant maintained that she had purchased the property for ₹15,00,000 and took possession.

The trial court dismissed the plaintiff’s suit for declaration, injunction and cancellation of the sale deed; the first appellate court affirmed that dismissal.

pp. 2–10

The plaintiff appealed under Section 100 CPC.

pp. 2–10

02Issues

i.1. Whether the first appellate court was right to dismiss the suit despite the appellant’s contention that title could not pass without a properly registered sale deed under Section 54 of the Transfer of Property Act.

p. 10

ii.2. Whether the first appellate court was right to rely on the alleged sale deed when, according to the appellant, it did not bear the transferor’s signature or thumb impression on the stamp papers.

p. 11

iii.3. Whether the first appellate court wrongly placed the entire burden of proof on the plaintiff, whom the court found to be illiterate.

pp. 11–13

03Law Applied

The Court considered Section 54 of the Transfer of Property Act, which governs transfer of ownership in immovable property by sale, and Section 100 CPC, under which a second appeal lies on a substantial question of law.

pp. 11–15

It relied on the doctrine of non est factum: where an illiterate person denies executing a document and asserts that it was fundamentally different from what they believed they were signing, the opposing party bears the burden of establishing the transaction’s genuineness.

pp. 11–15

The Court cited Ramathal v. K. Rajamani (Dead) through Legal Heirs, 2023 INSC 737, including its treatment of cash consideration and the evidentiary significance of the parties’ conduct.

pp. 11–15

Provisions in the judgment · 2 · Linked ones open on LawLens

Code of Civil Procedure, 1908 Section 100

Transfer of Property Act, 1882 Section 54

04Reasoning

The Court found that the 2013 registered document was a loan secured by mortgage at 24% interest and expressly stated that possession had not been transferred.

pp. 11–12

It accepted the registered discharge receipt as evidence of repayment and noted that the receipt and disputed sale deed were executed and registered on the same day, under consecutive document numbers.

pp. 12–13

Given the plaintiff’s illiteracy, the Court placed the burden on the defendant to prove that the sale deed represented a genuine sale.

pp. 12–13

It considered the absence of any reference to the mortgage or its discharge in the sale deed, the failure to mention delivery of the parent title deed, and the defendant’s reliance on cash consideration—unsupported by evidence of payment—as circumstances undermining the defendant’s account.

pp. 13–17

The Court also found that the plaintiff had made only a scratch on the sale-deed pages despite affixing a thumb impression near his photograph, and that the disputed English signature attributed to his son differed from the son’s admitted Tamil signature.

pp. 16–18