Case: DHARMAJI SHANKAR SHINDE  Vs. RAJARAM SHRIPAD JOSHI (DEAD) THROUGH LRS

case, the defendant thereon did not take any step for mutation of the land for three long years and the plaintiff thereon specifically objected to mutation in the name of respondent-defendant. The case in hand is clearly distinguishable on facts. 23. In the present case, there are no averments in the plaint as to the market value of the property and as to the inadequacy of the consideration. In his evidence, PW-1 has stated that the transaction of absolute sale could have been worth Rs.60,000- 70,000/- in the year 1967; but the respondents-plaintiffs have not produced the certificate of valuation of the land or the circle rate of the property at the time when Ex.P-73 was executed. The appellants contended that the suit property was sold for a proper consideration and relied upon the transaction that took place in the village in the year 1957 to establish that the sale consideration is appropriate. The trial court while deciding issue No.4 has held that the respondents-plaintiffs have failed to adduce any evidence to show that the market value of the suit property in the year 1967 was much more than what was paid by the appellants-defendants. 24. The respondents-plaintiffs have placed much reliance upon Ex.P-69-receipt to show that Shripad Joshi paid an amount of Rs.800/- to Shankar Shinde who in turn executed the receipt dated 26.07.1972 in favour of his father and at that time, PW-1 was also present. The appellants-defendants contend that Ex.P- 69-receipt is forged. Admittedly, neither parties to Ex.P-69-receipt nor the scribe who wrote the receipt are alive. In the light of defence plea questioning the correctness of Ex.P-69, the burden of proof is on the respondents-plaintiffs to adduce the best possible evidence to prove Ex.P-69-receipt. The respondents- plaintiffs examined PW-2-Prabhakar, son of the scribe-Gopal Tukaram Shivade to identify the handwriting and signature of the scribe of Ex.P-69. In his evidence, PW-2 stated that he is acquainted with the handwriting and signature of his father and that Ex.P-69-receipt was written by his father. 25. Gopal Tukaram Shivade-scribe, father of PW-2, was a Police Patil of Kudal for ten years and he expired in the year 1990. Ex.P-69-receipt was of the year 1972 and PW-2 was examined in the year 1994. After perusal of Ex.P-69-receipt, the trial court held that there are glaring defects in the said receipt i.e. faded and incomplete thumb impression of Shankar Shinde on the revenue stamp. The trial court has observed that except the evidence of PW-2, no other evidence has been adduced by the respondents-plaintiffs to prove Ex.P-69-receipt. Since the scribe was a Police Patil of Kudal, it was very much possible for the respondents-plaintiffs to prove the execution of the document by producing the admitted handwriting of the scribe so as to compare them with the questioned writing in the receipt. The trial court also pointed out that though PW-1-Rajaram Joshi claims that he was present at the time of execution of Ex.P-69, PW-1 had not signed in it nor attested it, so PW-1s evidence is of no help to prove the execution of the receipt. Be it noted that though Ex.P-69-receipt was of the year 1972, during his life time, based on Ex.P-69-receipt, Shripad Joshi had not taken any step to redeem the property. Even after death of Shripad Joshi in 1973, Ex.P-69-receipt did not see the light of the day till 1980 when the notice was said to have been issued by the respondents-plaintiffs. In these factual circumstances, it cannot be said that the plaintiffs have discharged the burden in proving Ex.P-69-receipt as genuine to hold that the parties had intended that Ex.P-73- document is only a mortgage by conditional sale and not a sale with condition to repurchase. The receipt Ex.P-69 cannot be relied upon as corroborative piece of evidence to hold that part payment was made by Shripad Joshi and that the parties treated Ex.P-73 as a mortgage by conditional sale. 26. When Ex.P-73 is clear and unambiguous, the first Appellate Court erred in relying upon Ex.P-69-receipt to draw inference as to the intention of the parties. The first Appellate Court did not keep in view that the appellants-defendants have denied Ex.P-69- receipt, hence, burden lies upon the plaintiffs to prove the contents of Ex.P-69 to bring in the intention of the parties that the transaction between the parties was only a mortgage by conditional sale. When the recitals in Ex.P-73-document is sufficient to gather the intention of the parties, the first Appellate Court erred in placing reliance on Ex.P-69-receipt to ascertain the intention of the parties to upset the findings of fact recorded by the trial court. The findings of the first Appellate Court and the High Court in placing reliance upon Ex.P-69-receipt to conclude that the transaction was a mortgage and not a sale are erroneous and the same cannot be sustained. 27. Though the transaction and condition to repurchase are embodied in one document, having regard to the intention of the parties and the surrounding circumstances, in our considered view, Ex.P-73 does not fall within the proviso to Section 58(c) of the Transfer of Property Act. Ex.P-73 a registered document, in our considered view, is not a mortgage but a transaction of sale with condition to repurchase. The High Court and the first Appellate Court did not properly appreciate the recitals in Ex.P-73 and that it does not create expressly or by implication the relationship of debtor and creditor. The High Court failed to note that since Shripad Joshi failed to pay the amount within the stipulated period of five years, the respondents-plaintiffs have lost their right to repurchase the property. When the findings of the first Appellate Court and the High Court though concurrent, whey they are shown to be perverse, this Court would certainly interfere with the findings of fact recorded by the courts below. The High Court has not properly appreciated the evidence and Ex.P-73 in the light of the surrounding circumstances and the impugned judgment is liable to be set aside.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]14. The question in each case is the determination of the real character of the transaction to be ascertained from the provisions of the deed viewed in the light of the surrounding circumstances. If the words are plain and unambiguous then in the light of the evidence of the surrounding circumstances, it must be given their true legal effect. If there is any ambiguity in the language employed, the intention is to be ascertained from the contents of the deed and the language of the deed is to be taken into consideration to ascertain the intention of the parties. Evidence of contemporaneous conduct of the parties is to be taken into consideration as the surrounding circumstances16. Intention of the parties as seen from the recitals of Ex.P-73:- By perusal of Ex.P-73, it is clear that eight days prior to Ex.P-73, Shripad Joshi has borrowed orally a sum of Rs.700/- for the purpose of marriage of his daughter. At the time of execution of Ex.P-73 (28.07.1967), Shirpad Joshi required more money for the same reason and he executed Ex.P-73-document titled as mortgage by conditional sale for a consideration of Rs.2500/- and on the date of execution of the said document, Shripad Joshi received only a sum of Rs.1800/-. The earlier borrowed amount of Rs.700/- was thus adjusted from the sale consideration of Rs.2500/-. The intention of the parties in putting an end to the debtor-creditor relationship with respect to the sum of Rs.700/- is clear from the recitals of the document i.e. adjustment of Rs.700/- from the total consideration of Rs.2500/- and parties intending to create a relationship of vendor and vendee by transfer of the suit property for a consideration of Rs.2500/-. Period of five years was fixed in Ex.P-73 within which Shirpad Joshi-father of the respondents-plaintiffs was to repay the said amount. On the date of execution of the document (Ex.P-73), the possession of the property was handed over to the appellants-defendants for cultivation. Further, recitals are to the effect that if the consideration amount is paid within five years, Shripad Joshi- executant will get the mortgage redeemed. In case, the amount is not paid within the stipulated period of five years, the mortgage shall be treated as an absolute sale and thereafter Shankar Shinde to pay the land revenue to the government and all other charges for which executant will have no complaint. The recitals of the document make clear the intention of the parties that if the amount is not repaid within the stipulated period of five years, the transferee will have absolute right and the mortgage will be treated as an absolute sale and the transferee to pay the land revenue and the other charges. These clauses in Ex.P-73, in our view, are consistent with the intention of the parties making the transaction a conditional sale with an option to repurchase17. Admittedly, executant of Ex.P-73, Shripad Joshi expired in the year 1973 and till his life time, he never took any action or step to get the property reconveyed. After death of Shripad Joshi in the year 1973, no immediate action was taken by his successor. Obviously, all the legal action were started in the year 1980 by the present plaintiffs based upon a receipt-Ex.P-69 dated 26.07.1972 under which an amount of Rs.800/- is said to have been paid to Shankar Shinde. Much emphasis has been placed by the respondents-plaintiffs on Ex.P-69-receipt which we would refer a little later. When being confronted with the recitals in Ex.P-73, in his cross-examination, PW-1-Rajaram Joshi admitted that the transaction was that of sale with the condition of repurchase and neither parties are described therein as mortgagor or mortgagee. Admission of PW-1 is a formidable evidence indicating the intention of the parties. Having not paid the amount within the stipulated period of five years, the plaintiffs have lost their right to repurchase18. Mention of borrowed a sum of Rs.700/- in the document is incidental. Mere incorporation of the word borrowed and mortgage by conditional sale cannot by itself establish that there is a debtor-creditor relationship. In fact, as pointed out earlier, the recitals of the document make it clear that the parties expressed their intention to put an end to the debtor-creditor relationship with respect to the sum of Rs.700/- that existed prior to the execution of Ex.P-73 and creating a relationship of vendor and vendee by transfer of the suit property for consideration of Rs.2500/-. As rightly observed by the trial court, in Ex.P-73, there is no mention of the rate of interest, right of foreclosure that are essential in a deed of mortgage19. The contention of the respondents is that in view of the mandatory provisions of the proviso to clause (c) of Section 58 of the Act, since the sale and the agreement to repurchase are embodied in the same document (Ex.P-73), the transaction is to be taken as a mortgage and the conditions enumerated in proviso to Section 58(c) of the Transfer of Property Act have been satisfied in the present case. On behalf of the respondents, it was submitted that the existence of creditor-debtor relationship can be derived from the recital in the document I have borrowed. As pointed out earlier, there are no recitals in the document to establish creditor-debtor relationship; nor does it contain the right of foreclosure, payment of interest etc. which are essential requirements in a deed of mortgage20. As per Section 58(a) of the Transfer of Property Act, the mortgage is the transfer of an interest in specific immovable property as security for the repayment of the debt; but such interest itself is immovable property. In the case in hand, non- mention of the mortgage amount for which the interest in the immovable property was created as security, indicate that the parties have never intended to create a mortgage deed. If really the parties have intended the transaction to be a mortgage, while handing over possession of the property to Shankar Shinde for cultivation, the parties would have stated that the cultivation and enjoyment of usufructs are in lieu of the interest payable by Shripad Joshi on the amount. But that was not to be so. The transfer of possession and right to cultivate the suit land could be conceived as the intention of the executant to transfer the right, title and interest in the property which are essentials in any transaction of a sale21. Moreover, as per the clauses in Ex.P-73-document, the possession of the suit property was also handed over to Shankar Shinde-father of the appellants. Though, it is stated that the transferee-Shankar Shinde was to pay the revenue to the government after five years, according to the appellants, ever since 1967, land revenue was paid by the father of the appellants. In his evidence, PW-1 admitted that revenue cess of the suit property has been paid by Shankar Shinde from 1967 and after his demise, by his legal heirs. Likewise, a mutation was also effected in the name of Shankar Shinde even in the year 1967. During his life time, father of the respondents-Shripad Joshi has not raised any objection to the mutation nor for the payment of the revenue cess by Shankar Shinde. Considering the contemporaneous conduct of the parties, it is clear that Shankar Shinde and thereafter the appellants were dealing with the suit property as if they were the owners of the land. The clause in Ex.P-73 that if the amount is not paid within a period of five years, the transaction will become a permanent sale deed and thereafter, the transferee will have the absolute right over the property are consistent with the express intention of parties making the transaction a conditional sale with option to repurchase22. The respondents-plaintiffs contended that the market value of the suit property was higher than the transaction value and therefore, Ex.P-73 is to be construed as a mortgage. In support of their contention, reliance was placed upon the judgment in Vithal Tukaram.The facts in Vithal Tukaram are clearly distinguishable with the facts and evidence on record in the present case. In that case, the value of the land was Rs.3500/- far in excess of the amount of Rs.700/- mentioned in the document. Considering the evidence of the respondent- defendant thereon and the facts of the said case, the Supreme Court held that the value of the land was far in excess of Rs.700/- mentioned in the agreement. Further, in the said case, the defendant thereon did not take any step for mutation of the land for three long years and the plaintiff thereon specifically objected to mutation in the name of respondent-defendant. The case in hand is clearly distinguishable on facts23. In the present case, there are no averments in the plaint as to the market value of the property and as to the inadequacy of the consideration. In his evidence, PW-1 has stated that the transaction of absolute sale could have been worth Rs.60,000- 70,000/- in the year 1967; but the respondents-plaintiffs have not produced the certificate of valuation of the land or the circle rate of the property at the time when Ex.P-73 was executed.The appellants contended that the suit property was sold for a proper consideration and relied upon the transaction that took place in the village in the year 1957 to establish that the sale consideration is appropriate.The trial court while deciding issue No.4 has held that the respondents-plaintiffs have failed to adduce any evidence to show that the market value of the suit property in the year 1967 was much more than what was paid by the appellants-defendantsIn these factual circumstances, it cannot be said that the plaintiffs have discharged the burden in proving Ex.P-69-receipt as genuine to hold that the parties had intended that Ex.P-73- document is only a mortgage by conditional sale and not a sale with condition to repurchase. The receipt Ex.P-69 cannot be relied upon as corroborative piece of evidence to hold that part payment was made by Shripad Joshi and that the parties treated Ex.P-73 as a mortgage by conditional sale26. When Ex.P-73 is clear and unambiguous, the first Appellate Court erred in relying upon Ex.P-69-receipt to draw inference as to the intention of the parties. The first Appellate Court did not keep in view that the appellants-defendants have denied Ex.P-69- receipt, hence, burden lies upon the plaintiffs to prove the contents of Ex.P-69 to bring in the intention of the parties that the transaction between the parties was only a mortgage by conditional sale. When the recitals in Ex.P-73-document is sufficient to gather the intention of the parties, the first Appellate Court erred in placing reliance on Ex.P-69-receipt to ascertain the intention of the parties to upset the findings of fact recorded by the trial court. The findings of the first Appellate Court and the High Court in placing reliance upon Ex.P-69-receipt to conclude that the transaction was a mortgage and not a sale are erroneous and the same cannot be sustained27. Though the transaction and condition to repurchase are embodied in one document, having regard to the intention of the parties and the surrounding circumstances, in our considered view, Ex.P-73 does not fall within the proviso to Section 58(c) of the Transfer of Property Act. Ex.P-73 a registered document, in our considered view, is not a mortgage but a transaction of sale with condition to repurchase. The High Court and the first Appellate Court did not properly appreciate the recitals in Ex.P-73 and that it does not create expressly or by implication the relationship of debtor and creditor. The High Court failed to note that since Shripad Joshi failed to pay the amount within the stipulated period of five years, the respondents-plaintiffs have lost their right to repurchase the property. When the findings of the first Appellate Court and the High Court though concurrent, whey they are shown to be perverse, this Court would certainly interfere with the findings of fact recorded by the courts below. The High Court has not properly appreciated the evidence and Ex.P-73 in the light of the surrounding circumstances and the impugned judgment is liable to be set aside.