Andhra Pradesh High Court
Judges : JAGMOHAN REDDY, P.CHANDRA REDDY
Sait Bolumal Dharmdas Firm, Bankers represented by Partner Bolumal - Appellant
Versus
Gollapudi Venkatachelapathi Rao - Respondent
Decided On : 01-28-59
EVIDENCE ACT, SECTION 92 - CONSTRUCTION - PROVISO 6 - ADMISSIBILITY OF ORAL EVIDENCE TO CONTRADICT, VARY, ADD TO OR SUBTRACT FROM TERMS OF A DOCUMENT - SCOPE AND APPLICABILITY.
Fact of the Case:
A suit was filed on the basis of a promissory note executed by the defendants. The defendants claimed that the note was given as security for a loan and that the transaction was actually a mortgage. The trial court admitted oral evidence to prove the defendants' claim, but the appellate court reversed the decision and held that the oral evidence was inadmissible under Section 92 of the Evidence Act.
Finding of the Court:
The High Court held that oral evidence is admissible under Proviso 6 to Section 92 of the Evidence Act only in cases where the terms of a document are ambiguous. If the language of an instrument is clear and unequivocal and the intention of the parties is easily deducible therefrom, it is not permissible to lead parole evidence to show that the document was not really what it purported to be.
Issues: Whether oral evidence is admissible to contradict, vary, add to or subtract from the terms of a document under Proviso 6 to Section 92 of the Evidence Act.
Ratio Decidendi: The court held that Proviso 6 to Section 92 of the Evidence Act applies only in cases where the terms of a document are ambiguous. If the language of an instrument is clear and unequivocal and the intention of the parties is easily deducible therefrom, it is not permissible to lead parole evidence to show that the document was not really what it purported to be. The court further held that the trial court erred in admitting oral evidence to prove the defendants' claim that the promissory note was given as security for a loan and that the transaction was actually a mortgage.
Final Decision: The High Court allowed the Letters Patent Appeal and reversed the judgment of the appellate court. The court held that the oral evidence was inadmissible under Section 92 of the Evidence Act and that the suit should be decreed as prayed for.
( 2 ) THE appellant laid an action on the foot of a promissory note executed by the defendants for Rs. 1400. 00 on 24-7-1942 The suit was resisted on the following defence, The 2nd defendant obtained a charge decree for Rs. 2,000. 00 against a third party. This decree was transferred to the Plaintiff under a document which recited a consideration of Rs. 600. 00, the understanding being that it should serve as security for monies to he advanced by the plaintiff from time to time. It was also part of the arrangement that the 2nd defendant should look after the execution of the decree and recover the amount. Pursuant to this, execution proceedings were started by the 2nd defendant in the name of the plaintiff. The properties were brought to sale and purchased by the 2nd defendant. The latter was paid a sum of Rs. 1400. 00 by the plaintiff for depositing the same into court towards the sale price and the suit promissory note was taken by way of security. Since the sale was confirmed and the plaintiff had withdrawn the sum of Rs. 1400. 00 from Court, the promissory note was unenforceable.
( 3 ) THE trial Court overruled the objection and decreed the suit in the view that oral evidence to ascertain the intention of the parties was inadmissible. In the result, the suit was decreed as prayed for. On appeal, the Subordinate Judge of Vijayawada disagreed with the opinion of the District Munsiff in regard to the admissibility of oral evidence and remanded the suit to the trial court to decide the point relating to the agreement pleaded by the defendants.
( 4 ) AS against the said order of remand, the plaintiff filed a Civil Miscellaneous Appeal in the High Court. The order of remand was set aside by Raghava Rao J. , who held that evidence surrounding the execution of the document was admissible. Accordingly the matter was remitted to the Subordinate Judge for disposal in the light of his judgment. After remand, the Subordinate Judge, on an examination of the oral evidence bearing on the surrounding circumstances, found that the deed in question was not an absolute sale but was executed as and by way of security. In that opinion, he allowed the appeal and dismissed the suit.
( 5 ) THE Second Appeal carried by the plaintiff was not successful Krishnaswami Nayudu J. , who heard it agreed with the lower appellate court with regard to the applicability of Section 92 and dismissed the Second Appeal but granted leave.
( 6 ) SINCE the controversy here centers round Section 92 of the Evidence Act, it is convenient to extract it. "when the terms of any such contract, grant or other disposition of property, or any matter required by law to be reduced to the form of a document, have been proved according to the last section, no evidence of any oral agreement or statement shall be admitted, as between the parties to any such instrument or their representatives in interest, for the purpose of contradicting, varying, adding to or subtracting from its terms:" This is subject to six exceptions. The first five are not relevant for the purpose of this enquiry and may, therefore, be omitted. Proviso 6 declares that any fact may be proved which shows in what manner the language of a document is related to existing facts. It is the scone of this proviso that has to be determined in this appeal.
( 7 ) IT is clear from the terms of Section 92 that evidence of any oral agreement or statement is excluded for any of the purposes indicated therein unless it falls under any of the provisos. The question is whether the instant case attracts proviso 6. In our judgment, this proviso could be called in aid only in cases where the terms of a document are ambiguous. If the language of an instrument does not yield clear meaning and is open to two interpretations, extrinsic evidence of surrounding circumstances could be adduced
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