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2006 Supreme(All) 565

IN THE HIGH COURT OF ALLAHABAD
UMESHWAR PANDEY, J.
RAMU MAHABIR - Appellant
Versus
GHURHOO SAMU. - Respondents
S. A. 2904 Of 1986
Decided On : 02/22/2006

Advocates Appeared:
R.B.Pradhan, R.S.RAM, S.K.VERMA, SIDDHARTH VERMA

Headnote:

Fraud - Sale of Property - Section 25 (i) of the Contract Act - [Section 25 (i) of the Contract Act] - The court discussed the application of Section 25 (i) of the Contract Act, emphasizing that even if no consideration had passed for the transfer of the property, it would not make any difference in view of Section 25 (i) of the Contract Act. The court referred to the case law of Smt. Mania v. Deputy Director of consolidation AIR 1971 Allahabad 151 to support its interpretation. However, the court found that the sale deed was executed by way of love and affection between the parties, protecting it under Section 25 (i) of the Contract Act. The court also highlighted the burden of proof in cases involving fiduciary relationships and the presumption of correctness in registered deeds.

Fact of the Case:

The plaintiff filed a suit for cancellation of a sale-deed, alleging fraud and misrepresentation by the defendant. The trial court decreed the suit, but the lower appellate court reversed the decision, holding that the sale deed was executed out of love and affection. The plaintiff appealed, arguing that the lower appellate court failed to consider the fraud and misrepresentation and wrongly assumed jurisdiction.

Finding of the Court:

The court found that the lower appellate court erred in its interpretation of the sale deed as a transaction of gift, emphasizing that the burden of proof rested on the defendant to prove the validity of the deed. The court also criticized the lower appellate court for not considering the reasonings given in the trial court's judgment and for sidetracking the issues of fraud and misrepresentation. The court allowed the appeal and set aside the judgment and decree of the lower appellate court, restoring the trial court's decision.

Issues: The court addressed the substantial questions of law, including the consideration of fraud and misrepresentation, the application of Section 25 (i) of the Contract Act, and the burden of proof in cases involving fiduciary relationships.

Ratio Decidendi: The court emphasized the burden of proof in cases involving fiduciary relationships, the presumption of correctness in registered deeds, and the need for a proper consideration of the reasonings given in the trial court's judgment. The court also highlighted the misinterpretation of the sale deed as a transaction of gift by the lower appellate court.

Final Decision: The court allowed the appeal, set aside the judgment and decree of the lower appellate court, and restored the trial court's decision.

( 1 ) THIS second appeal of the plaintiff has been filed against the judgment and decree dated 20. 9. 1986 passed by the lower appellate court (IInd. Addl. District judge, Ghazipur ).

( 2 ) THE appellant had filed a suit for cancellation of a sale-deed dated 10. 12. 1984 on several grounds taken in the pleadings including the ground that the sale had been obtained by practicing fraud upon him which could be easily manipulated by the defendant/respondent on account of his old age and also on account of his being illiterate. He further stated that no consideration in the present transfer by sale had passed from the defendant to him and he was cleverly deceived by the respondent who represented to the plaintiff that he wanted a surety bond to be executed by him to indemnify the defendant towards the payment of some dues to the Government. The plaintiff was also given to understand that in case he did not execute the surety bond, the defendant/respondent might face arrest and detention for such non-payment of the dues. After having been fully convinced by the crafty talks of the defendant and on account of being under his influence from before, the plaintiff agree to execute the surety bond and he was taken to the court premises where instead a bond this sale-deed was got executed by fraud and misrepresentation.

( 3 ) THE defendant/respondent contested the suit and filed a written statement disclosing certain facts and pleading inter alia that the sale-deed in question was not got executed by him by practicing fraud or any sort of misrepresentation nor did he unduly influence the plaintiff, an old man of seventy years of age. He further pleaded that the plaintiff had three daughters only who had been married and finding himself all alone and lonely he started living with the defendant who happens to be his nephew. He was taking his meals and staying with the defendant and after the defendant joined a service he used to give all money which he received as his salary to the plaintiff only. The plaintiffs daughters and his sons-in-law did not take any care of him and as such the defendant had been looking after his uncle (plaintiff) with utmost sincerity and care. Since the defendants father had died and he had separated from his other brothers his marriage was also got arranged and conducted by the plaintiff himself. The defendants wife also took maximum care of plaintiffs comfort while he was residing with her. Later on since the plaintiff was extremely pleased with the care and comfort accorded to him by the defendant and the wife he told his daughters that he was going to transfer his entire property to his nephew (defendant ). The defendant further pleaded that in the circumstances as stated above, this sale-deed was executed and no element of fraud had been there in this transfer of plaintiffs property through the impugned sale-deed.

( 4 ) ON the pleadings of the parties, the trial court framed as many as five issues and in the findings of issues No. 1 and 5 taken together it was held that no consideration passed for the disputed sale of property and that was the only property held and possessed by the plaintiff as a source of his livelihood and virtually there was no occasion in such circumstances to transfer the property showing it to be a transaction of sale. Accordingly the learned trial court having believed the story set up in the plaint about fraud and misrepresentation played upon the plaintiff by the defendant found that the sale-deed in question as liable to be cancelled and accordingly after giving formal finding on the other issues decreed the suit with costs.

( 5 ) THE respondent/defendant preferred an appeal before the lower appellate court against the judgment and decree passed by the trial court in which the findings, as had been recorded by the trial court that the sale deed in question was a result of fraud and misrepresentation practiced upon the plaintiff, were reversed and it has been held that the document



























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