The main legal point established is the interpretation of the nature of agreements and the determination of whether they were executed as security for a money transaction.

J U D G M E N T

This appeal has been filed by the plaintiffs against the judgment and decree dated 26/03/2003 in O.S.No.123/2001 on the file of the Subordinate Judge's Court, Kattappana. The respondents herein are the defendants in the suit. The parties and the documents will be referred to as described in the suit.

2. The suit was one for cancellation of Exts.A1 to A3 agreements executed by the plaintiffs in favour of defendants 1 to 3. According to the plaintiffs, who are siblings, the agreements were executed on 23/08/1999 when an amount of ₹2,30,000/- was borrowed from the first defendant. The documents though styled as 'agreements for sale' were meant to be only as a security for the money transaction between the parties. It was agreed that when the amount was repaid with interest, the first defendant would execute and register three release deeds in favour of the plaintiffs. While so in June 2000, the first plaintiff was informed by the first defendant that the money he had lend to the former had been taken from defendants 4 and 5 and that the money is being demanded back and therefore wanted the plaintiffs to return the amount immediately. The first plaintiff was not in possession of necessary funds to repay the debt. Hence he informed the first defendant that he was prepared to pay the money to defendants 4 and 5 and also to execute necessary documents in their favour. Accordingly, on 18/06/2000 defendants 1 and 2 executed Ext.A4 agreement in favour of the fourth defendant whereby they agreed to relinquish all their rights under Exts.A1 to A3 in favour of defendants 4 and 5. The third defendant was not in station and hence he is not a signatory to Ext.A4 agreement. In the light of Ext.A4 dated 18/06/2000, Exts.A1 to A3 stood rescinded and cancelled. It was agreed that the plaintiffs would execute agreements for sale of the plaint schedule properties in favour of defendants 4 and 5 and that defendants 1 to 3 would execute release deeds relinquishing their rights under Exts.A1 to A3. 10/07/2000 was fixed for execution and registration of the agreement and release deeds. The plaintiffs thus executed three registered agreements, that is Exts.B1 to B3, agreeing to sell the schedule property to the fourth defendant and the B schedule to the fifth defendant. However, defendants 1 to 3 never turned up to execute the release deeds. Though the first plaintiff contacted the first defendant and demanded execution of the release deeds, he never acceded to the request made. The liability of the plaintiffs towards defendants 1 to 3 have been completely discharged. Defendants 1 to 3 have no rights left under Exts.A1 to A3 and so the plaintiffs are entitled to get the said agreements cancelled. Hence the suit praying for a decree for cancellation of Exts.A1 to A3 executed by the plaintiffs in favour of defendants 1 to 3.

3. Defendants 1 to 3 filed a joint written statement denying the allegation of the plaintiff that Exts.A1 to A3 had been executed as security when money was borrowed from the defendants. Exts.A1 to A3 are not agreements executed as security for the money transaction, on the other hand they are documents executed by the plaintiffs agreeing to sell the plaint schedule properties to the defendants for valuable consideration stated therein. Advance sale consideration as stated in the agreements had also been paid to the plaintiffs. Defendants 4 and 5 are money lenders. There were disputes relating to money borrowed by the first defendant from them. Defendants 4 and 5 refused to acknowledge certain payments made by the first defendant and they demanded huge amounts from the first defendant, which he refused to give. On 18/06/2000 at about 09:30 p.m., defendants 4 and 5 trespassed into the house of the first defendant and forcibly took away valuables and documents including Exts.A1 to A3. Ext.A4 document relied on by the plaintiffs alleging it to have been executed by the first defendant in favour of defendants 4 and 5 is a