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IN THE HIGH COURT OF BOMBAY
Bomi Munchershaw Mistry
Versus
Kesharwani Co-operative Housing Society Ltd
Decided on 29.6.2005
SPECIFIC RELIEF ACT, 1963 - SECTION 31 - CANCELLATION OF DEED - DEED OF CONVEYANCE ANTEDATED TO DEFRAUD REVENUE - CLOUD ON TITLE OF ADJOINING LAND OWNERS - DECLARATION GRANTED INSTEAD OF CANCELLATION - APPEAL AND CROSS-OBJECTION DISMISSED.
Fact of the Case:
Plaintiff, a beneficiary and reversioner under a trust created in 1951, filed a suit seeking cancellation of a deed of conveyance executed in 1967 on the grounds that it was ante dated to defraud revenue and cast a cloud on his rights. The trial court declined to cancel the deed but declared it inoperative to the extent it affected the plaintiff's rights. Both the plaintiff and the cross-objectionists (surviving trustees of the trust) appealed.
Finding of the Court:
The court held that the trial court was justified in declining to cancel the deed of conveyance. The deed was executed to lawfully convey part of the land belonging to the vendor to the society for lawful consideration. The act of ante dating the document may render the society liable for penal action, but it does not render the entire document void. The court also held that the declaration granted by the trial court was sufficient to protect the plaintiff's rights and remove the cloud on his title.
Issues: 1. Whether the deed of conveyance was ante dated to defraud revenue and cast a cloud on the plaintiff's rights? 2. Whether the trial court erred in declining to cancel the deed of conveyance?
Ratio Decidendi: 1. The court held that the deed of conveyance was ante dated to defraud revenue and cast a cloud on the plaintiff's rights based on the following evidence: a) The deed was dated 31/3/1967, but the plan annexed to the deed bore the date 30/11/1967. b) The deed referred to a tripartite agreement dated 21/3/1967, wherein it was recorded that the consideration amount had been reduced due to reduction in F.S.I. The payment of Rs. 1.75 lakhs referred to in the agreement was made by the society on 5/7/1967, which was after the date of the deed. c) In a letter dated 19th July, 1967, the Advocate for the vendor had made a grievance to the advocate for Zaveri, that the conveyance deed has not yet been executed even though the draft conveyance has been approved on 29/3/1967. d) In the audited annual accounts finalised by the society for the year ending 30th June, 1967, the property in question is not shown as an asset of the society but it is stated that the society has agreed to purchase the land and part payment has been made in respect thereof. e) In a letter dated 30-11-1967 addressed to the society's advocates it is recorded that on 'that date' i.e. 30-11-1967 the sale has been completed. f) In a letter dated 20th December, 1968, Advocate for the vendor had informed the tenants that Ratan Villa property i.e. the property mentioned in the deed Exhibit-J has been sold to the society on 30th November, 1967. g) Lalchand - an officer of the Court did not enter the witness box obviously for fear of being exposed. 2. The court held that the trial court did not err in declining to cancel the deed of conveyance. The deed was executed to lawfully convey part of the land belonging to the vendor to the society for lawful consideration. The act of ante dating the document may render the society liable for penal action, but it does not render the entire document void. The court also held that the declaration granted by the trial court was sufficient to protect the plaintiff's rights and remove the cloud on his title.
Final Decision: The appeal and the cross-objection were dismissed with no order as to costs.
( 1 ) THE issue raised in Appeal No. 590 of 1994 and in cross-objection (L) No. 4 of 1996 filed in Appeal No. 170 of 1994, being common, both these matters are heard together and disposed of by a common judgment. The cross-objectionists are the surviving trustees of the trust created under a deed of settlement dated 17-3-1951. The appellant in appeal No. 590 of 1994 is a beneficiary and reversioner under the aforesaid trust. Both the appellant (hereinafter referred to as the plaintiff) arid the cross-objectionists have common interest in these proceedings.
( 2 ) THE sole grievance of the plaintiff and the cross objectionists in these proceedings is that the learned trial Judge grossly erred in declining to cancel the deed of conveyance dated 31/3/1967 executed by Lalchand Hirachand (original defendant No. 2) in favour of Kesharwani Co-operative Housing Society (original defendant No. 1) even after holding that the said deed was ante dated with a view to defraud the revenue and that the said deed casts a cloud on rights of the plaintiff to enjoy the trust property. By the impugned Judgment dated 3/12/1992 passed in Suit No. 942 of 1973, the learned trial judge, instead of cancelling the deed of conveyance, declared that the said deed of conveyance dated 31/3/1967 shall be inoperative and of no effect to the extent it expressly or by implication seeks to whittle down the rights of the adjoining land owners namely the trustees under the deed of settlement dated 17-3-1951, its beneficiaries and reversioners (including the plaintiff ).
( 3 ) THE facts relevant for the purpose herein are that prior to 1951, ratanchand Hirachand was owner of a bungalow known as Ratan Villa with outhouse, guest house, servant quarters and garages constructed on a large piece of land admeasuring about 6000 to 7000 sq. yds. bearing City Survey no. 2/590 and 2a/590 situated at Napean Sea Road, Bombay.
( 4 ) BY a deed of conveyance dated 20th March, 1951, the said Ratanchand hirachand sold 565 square yards of land being part of City Survey No. 2/590 to Munchershaw P. Mistry and others (Trustees under a Deed of Settlement dated March 17, 1951 ). The said conveyance deed contained restrictive covenants to the effect that Ratanchand Hirachand, his heirs, executors, administrators and associates and all persons desiring and claiming title from him shall not build any structure at any time thereafter higher than the then existing garages on the remaining land bearing Survey No. 590 (Part) nor any structure in front of toware' s South or on the central passage or in the garden in front of the property known as Ratan Villa as more particularly set out in the plan annexed thereto.
( 5 ) DURING the period 1954-55, a building named 'maneck-Abad' consisting of ground plus two floors was constructed on the plot of land purchased by the trust under the deed of conveyance dated 20th March, 1951. The plaintiff is residing at Maneck-Abad as the beneficiary and as a reversioner and the plaintiff is entitled to a share in the corpus of the said trust created under the deed of settlement dated March 17, 1951.
( 6 ) RATANCHAND Hirachand had filed a suit bearing Suit No. 304 of 1954 in the High Court at Bombay seeking partition of the joint family properties including the property on which Ratan Villa bungalow existed. In that suit, lalchand Ratanchand was appointed as a private Receiver in respect of the lands belonging to Ratanchand Hirachand.
( 7 ) THE said Lalchand Hirachand entered into an agreement with G. G. Zaveri on 2nd July, 1966 (Exhibit 'a- 111) for sale of 5325 square yards of land bearing City Survey No. 590 (Part) together with structures standing thereon for Rs. 21,50,000/ -. Clause 2 of the said agreement for sale provided that the said Lalchand shall at the time of completion of sale give to Zaveri vacant possession of the entire property agreed to be sold and shall also remove the restrictive covenants attached to the said prope
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