IN THE MADURAI BENCH OF MADRAS HIGH COURT
C.S. KARNAN, J.
M. Manoharan & Others – Appellants
Versus
P. Rasu & Others – Respondents
S.A. (MD) No. 684 of 2010
Decided On : 13-04-2015
fraudulent transaction - Property Dispute - [Indian Contract Act, 1872, Section 17, Indian Registration Act, 1908, Section 17, Indian Penal Code, 1860, Sections 406, 420, 341, 506 (i)] - The court discussed the fraudulent transactions executed through general power of attorney and sale deeds, the inconsistency in the plaintiff's statements, and the need for criminal proceedings to prove fraud. The court found the plaintiffs' claims to be inconsistent and allowed the Second Appeal, setting aside the lower court's decree and judgment.
Fact of the Case:
The plaintiffs claimed that the defendants executed fraudulent transactions through general power of attorney and sale deeds, while the defendants denied the claims and accused the plaintiffs of unscrupulous behavior. The trial court decreed the suit in favor of the plaintiffs, which was confirmed by the appellate court.
Finding of the Court:
The court found the plaintiffs' claims to be inconsistent and noted the lack of criminal proceedings to prove fraud. It also highlighted the plaintiffs' receipt of a sum of money from the defendants, which remained unresolved. The court allowed the Second Appeal, setting aside the lower court's decree and judgment.
Issues: The main issues revolved around the validity of the transactions executed by the defendants, the inconsistency in the plaintiff's statements, and the need for criminal proceedings to prove fraud.
Ratio Decidendi: The court's decision was influenced by the inconsistency in the plaintiff's statements, the lack of criminal proceedings to prove fraud, and the unresolved issue of the plaintiffs' receipt of money from the defendants.
Final Decision: The Second Appeal was allowed, and the decree and judgment passed by the lower courts were set aside.
1. The brief facts of the case are as follows:-
The plaintiffs 1 to 3 / respondents 1 to 3 herein had filed a suit in O.S.No.146 of 2005, on the file of District Munsif Court, Periyakulam against the defendants / appellants stating that the suit schedule mentioned property had been purchased by the father of the first defendant on 26.08.1961 through a registered sale deed bearing document No.2202, on the file of Sub Registrar, Theni. The father of the first defendant had sold the said property in the month of October 1961 to and in favour of the father of the first plaintiff, viz., Paramasivam Chettiyar for a sum of Rs.90/- by way of an oral transaction. The said transaction had happened in the presence of one Kamachi, S/o.Subburam, native of Sedapatti Village and Govindan, S/o.Subbaian, a native of Vadapudupatti. Accordingly, the said Paramasivam Chettiyar is occupying and enjoying the property. The Revenue Authorities had issued a patta, chitta and adangal. The same Paramasivam Chettiyar had expired in the year 1999, after leaving his only son, the first plaintiff herein and as such, the first plaintiff had succeeded the property as sole legal-heir of Late Paramasivam Chettiyar.
2. The plaintiffs further stated that under the circumstances, the defendants 1 to 7, had alienated the said suit schedule mentioned property to and in favour of the eighth and ninth defendants by way of registered sale deed bearing document No.2204, date 12.07.1993. The defendants 1 to 7 have no locus standi or rights to alienate the property. Under these circumstances, the plaintiffs approached the 21st defendant in the third week of January 2005 and requested him for a loan of a sum of Rs.10,000/-. In turn, the 21st defendant told the plaintiffs to meet after three days for arranging the said loan. Accordingly, the plaintiffs met the 21st plaintiff to execute the register mortgage against the loan amount. He accepted the same and handed over the chitta, adangal records to the 21st defendant on 27.01.2015. The 21st defendant had obtained signature from the plaintiffs in the typed document which had been prepared in advance and also obtained signature in the blank papers. Further, the plaintiffs were taken into the Sub Registrar's Office, wherein, signatures were obtained from him by the 21st defendant. The 21st defendant had not permitted the plaintiffs to read the document. The 12th and 13th defendants had jointly obtained the mortgage deed for a sum of Rs.10,000/- and this arrangement was made by the 21st defendant.
3. The plaintiffs further sated that believing that the said document as mortgage deed, they signed on it. The defendants 8 to 11 had also signed on the said documents. The 21st defendant told the plaintiffs that the defendants 8 to 11 are witnesses. Thereafter, all came out of the Registration Office and then the 21st defendant paid a sum of Rs.9,500/-, after deducting a sum of Rs.500/- towards registration charges. Actually, on 27.01.2005, the 21st defendant had not obtained mortgage deed. Instead of that, a general power of attorney had been executed to and in favour of the 12th and 13th defendants fraudulently. But the plaintiffs have no intention to execute the general power of attorney. The fraud came to light later on. The 21st defendant and his accomplices and 12th and 13th defendants had executed a sale deed to and in favour of the 18th defendant, who is the father of the 21st defendant. On 01.02.2005, the sale deed had been registered and as such, the property to an extent of 2.58 cents and 2.10 cents have been transferred. Thereafter, on 28.01.2005, the defendants 8 to 17 had fraudulently joined with the 21st defendant and alienated a portion of the said property to and in favour of the 14th and 17th defendants through 12th and 13th defendants.
4. The plaintiffs further stated that only after obtaining a copy of the document dated 31.05.2005, they came to know about the contents of the documents which they had signe
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