Regular Second Appeal No. 4119 of 2009 -1- IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH Regular Second Appeal No. 4119 of 2009 Date of decision : October 06, 2010 Randhir Singh ....Appellant versus Ranjit Singh ....Respondent Coram: Hon'ble Mr. Justice L.N. Mittal Present : Mr. Puneet Jindal, Advocate, for the appellant Mr. Malkiat Singh, Advocate, for the respondent L.N. Mittal, J. (Oral) This is second appeal by plaintiff Randhir Singh who was successful in the trial court but has been non-suited by the lower appellate court. Kishan Singh was grand-father of both the parties. Plaintiff's case is that defendant was owner of the suit property measuring 2½ marlas situated in Mathurapuri, Phillaur whereas plaintiff was owner in possession of 13 marlas 3 sarsahi land in village Haripur (hereinafter called the exchanged land) being 1/6th share of 4 kanals land. The parties orally exchanged the aforesaid properties and also exchanged possession thereof. Regular Second Appeal No. 4119 of 2009 -2- Thereafter memorandum of settlement dated 7.4.2000 was also recorded. Accordingly, the plaintiff became owner in possession of the suit property. Defendant became owner in possession of the exchanged land. The defendant also constructed boundary wall of big kothi in village Haripur around the exchanged land. The plaintiff accordingly sought declaration that he is owner in possession of the suit property in view of exchange and defendant has taken the exchanged land in lieu thereof. The plaintiff also sought permanent injunction. The defendant denied the plaint allegations. The plea of exchange of the properties and exchange of possession thereof was controverted. It was pleaded that the defendant is owner in possession of the suit property which he purchased vide sale deed dated 15.10.1998 from plaintiff's father for ` one lac. It was pleaded that ground floor of the suit property is in possession of tenant-Bank and first floor thereof is in possession of the defendant. It was also alleged that defendant's father had 5/6th share in 4 kanals land in question whereas the plaintiff's father has remaining 1/6th share but plaintiff is not sole heir of his father as plaintiff's mother and two sisters are also legal heirs of plaintiff's father. Various other pleas were also raised. Learned Civil Judge (Junior Division), Phillaur vide judgment and decree dated 13.6.2007 decreed the plaintiff's suit. However, first appeal preferred by the defendant has been allowed partly by learned Additional District Judge, Jalandhar vide judgment and decree dated 21.7.2009 and thereby suit filed by the plaintiff stands dismissed except that Regular Second Appeal No. 4119 of 2009 -3- the plaintiff was declared to be in possession of the suit land. Feeling aggrieved, the plaintiff has preferred the instant second appeal. I have heard learned counsel for the parties and perused the case file. Factum of exchange between the parties and subsequent execution of memorandum of exchange Annexure A/1 is fully proved and has also been held proved by the courts below. The parties also exchanged the possession of the properties in question as held by the courts below. In this context, it has to be noticed that the plaintiff himself appeared in the witness box and also examined two attesting witnesses of the memorandum of exchange namely Surinder Singh PW5 and Balvinder Singh PW4. The plaintiff also examined scribe of the said document Satnam Singh PW2. All of them have stated that the said document was executed by the parties. The defendant has examined Bhajan Singh DW1, Santokh Singh DW2 and Jaswinder Singh DW3 who are also witnesses of the aforesaid document. They have denied the execution of the document. However, their statements have been rightly discarded by the courts below. They have admitted their signatures on the aforesaid document. However, they stated that their signatures had been obtained on blank papers. Obviously, the said statement made by these witnesses is unbelievable and unreliable. They are relatives of the defendant and therefore, by making said statement they have tried to depose in favour of the defendant against facts. Bhajan Singh stated that in fact compromise had taken place between the parties on the day of this document. Similar statement has been made by other witnesses. Regular Second Appeal No. 4119 of 2009 -4- It is, thus, apparent even from the evidence of the defendant also that the aforesaid document has been executed by the parties. In addition to the aforesaid, it has to be noticed that defendant himself has not stepped into witness box. It is correct that the defendant has examined his attorney as witness. However, the factum of exchange was within personal knowledge of the defendant himself and therefore, it was imperative for the defendant to have himself stepped into witness box. Consequently, on account of non-examination of the defendant as his own witness, very strong adverse inference arises against him. It would also not be out of place to notice with significance that both the courts below have given concurrent finding regarding execution of the document dated 7.4.2000 and also regarding exchange of possession of the properties by the parties prior to execution of the said document. The defendant has not challenged the said finding of the courts below. Consequently, the said finding has attained finality. Even otherwise, the lower appellate court is final court of fact. Finding of the courts below to the aforesaid effect is based on proper appreciation of evidence and is supported by cogent reasons and is not shown to be perverse or illegal so as to call for interference in the second appeal. Learned counsel for the defendant-respondent contended that Satnam Singh PW2 scribe of the document has stated that possession of the properties was not exchanged in his presence. However, this statement of Satnam Singh PW2 is completely in consonance with the version of the plaintiff and is not in any manner in conflict with his version because it is Regular Second Appeal No. 4119 of 2009 -5- the case of the plaintiff also that possession of the properties had been exchanged earlier and the document dated 7.4.2000 was executed later on as memorandum of exchange. There is also recital in the document itself to the effect that possession had already been exchanged by both the parties. Consequently, the defendant-respondent cannot derive any capital out of aforesaid statement of Satnam Singh PW2. The plaintiff has been non-suited by lower appellate court on the ground that document dated 07.4.2000 is unregistered although it required compulsory registration. This conclusion of the lower appellate court is illegal and unsustainable. As noticed hereinabove, there was oral exchange between the parties. Possession was also exchanged between the parties pursuant to oral exchange. It was thereafter that the document dated 7.4.2000 was executed as memorandum of exchange. A bare perusal of the said document also reveals that the exchange was not effected through this document. It was only a memorandum of exchange which had already taken place and even exchange of possession had already taken place. Section 118 of the Transfer of Property Act is not applicable in State of Punjab and consequently oral exchange is legally permissible. In view thereof, the memorandum of exchange dated 7.4.2000 did not require compulsory registration. In this conclusion, I am supported by judgment of this Court in the case of Kishori Lal versus Babu Ram etc. , 2003(1) RCR (Civil) 807. Consequently, there was valid exchange between the parties and pursuant to exchange the plaintiff has become owner in possession of the suit property. Regular Second Appeal No. 4119 of 2009 -6- Following substantial question of law arises for determination in the instant second appeal :- “Whether the finding of the lower appellate court that document dated 7.4.2000 required compulsory registration and being un-registered did not have the effect of exchange is perverse and illegal ?” For the reasons already recorded, the aforesaid substantial question of law is answered in favour of the plaintiff-appellant and it is held that the aforesaid document did not require compulsory registration because it is only memorandum of exchange whereas oral exchange had already been taken place between the parties and even possession had also been exchanged. Learned counsel for the defendant-respondent contended that plaintiff's father since deceased was owner of the exchanged land which had not been mutated in favour of the plaintiff. However, this position was well known to the defendant-respondent when he effected the exchange and consequently no such objection can be raised by the defendant. Learned counsel for the defendant-respondent also contended that defendant's father had 5/6th share in 4 kanals land in question and therefore, the question of delivery of possession of the exchanged land by the plaintiff to the defendant did not arise. This contention is also untenable because the plaintiff's father since deceased was owner of the remaining 1/6th share in 4 kanals i.e. owner of the exchanged land and possession thereof was transferred to the defendant pursuant to exchange. Learned counsel for the defendant-respondent also contended Regular Second Appeal No. 4119 of 2009 -7- that ground floor of suit property was already in possession of tenant-Bank and therefore, possession of the suit property could not be transferred to the plaintiff. This contention is also misconceived and devoid of any substance. Even possession of tenancy premises can be transferred to transferee although such possession would be symbolic but pursuant thereto the transferee would be entitled to receive rent from the tenant. In addition to it, possession of first floor of the suit property was actually and physically transferred to the plaintiff pursuant to exchange. In addition to it there is also finding by both the courts below that possession of the suit property had been transferred to the plaintiff and the said finding has not been challenged by the defendant-respondent and has attained finality. Learned counsel for the respondent also contended that sale deeds were required to be executed pursuant to document dated 7.4.2000 but not have been executed. This contention also cannot be accepted because in the case of exchange, sale deeds are not required to be executed. No sale consideration in terms of money has been recited in the document. Consequently, question of execution of sale deeds although stated in the document did not arise. On the contrary, it was a completed exchange as the oral exchange had already taken place and possession had also been exchanged before the memorandum of exchange was executed. Learned counsel for the respondent contended that the alleged exchange had taken place on 7.4.2000 itself, the date of the document. However, even if oral exchange had taken place on the same day and possession had also been exchanged pursuant thereto and subsequently Regular Second Appeal No. 4119 of 2009 -8- memorandum of exchange was executed although on the same day, it would nevertheless be a memorandum of exchange and would not become exchange deed. Perusal of contents of the document reveals that the exchange had already been taken place and the document itself did not effect the exchange. For the reasons aforesaid, the instant second appeal is allowed and judgment and decree of the lower appellate court are set aside and the judgment and decree of the trial court are restored. ( L.N. Mittal ) October 06, 2010 Judge 'dalbir'