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2024 Supreme(Online)(KER) 15812
HIGH COURT OF KERALA
M.A. ABDUL HAKHIM, J
LAILA NELSON – Appellant
Versus
K.R LENIN – Respondent
RSA 345/2024
M.RAJESH, ARUN BABU
A sale deed executed as security for a loan must be clearly evidenced; mere assertions without supporting documentation or agreement do not suffice to invalidate the deed.
Headnote:
[Security] - [Property Law] - [Act Section List] - [The court examined the validity of a sale deed executed as security for a loan, interpreting the intentions of the parties and the necessity of written agreements, ultimately affirming the lower courts' decisions regarding possession and the nature of the transaction.]
Fact of the Case:
The plaintiff, a housewife, sought to declare a sale deed executed as security for a loan invalid, claiming it was never intended as a sale. The defendants, a husband and wife, countered that the sale deed was valid and sought possession of the property.
Finding of the Court:
The court found that the plaintiff failed to prove her claim that the sale deed was merely a security. The evidence presented did not support her assertions, and the execution of subsequent lease deeds undermined her position.
Issues: Whether the sale deed was executed merely as security for a loan and whether the plaintiff was entitled to reconveyance of the property.
Ratio Decidendi: The court held that the burden of proof lies with the plaintiff to establish that the sale deed was intended only as security, which she failed to do. The absence of a written agreement and subsequent actions contradicted her claims.
Final Decision: The Regular Second Appeal is dismissed.
The plaintiff in suit for declaration and injunction, has filed this appeal. The parties are referred according to their status before the Trial Court.
2.The plaintiff filed the suit with the averments that the plaintiff is a housewife and the defendants, who are husband and wife, are money lenders; that the Plaint Schedule Property of 4.05 ares and building therein belongs to the plaintiff; that the plaintiff availed a loan of Rs.2,50,000/- from the 2nd defendant in the year 2006; that as insisted by the 2nd defendant the plaintiff had to execute Ext.A3 sale deed in favour of the 2nd defendant as a security for the said loan; that the 2nd defendant had agreed to re-
- convey the property to plaintiff on return of the said amount of Rs.2,50,000/- ; that the plaintiff executed lease deed also as security with respect to the building in the property as demanded by the defendant No.2; that at the time of execution of Ext.A3, the property was under mortgage in favour of bank; that the plaintiff paid the amount due to the bank and after release of mortgage, the Ext.A2 Title deed received from the Bank was also handed over to the defendants on their demand; that the defendant No.1 attempted to evict the plaintiff by force from the plaint schedule property; that the sale deed and lease deed were executed only as security; the plaintiff never intended to execute those documents; and that the value of the plaint schedule property is Rs.25,00,000/-. On these contentions, the plaintiff sought a decree to set aside Ext.A3 sale deed and to declare that the same is not binding on the plaintiff and to allow the plaintiff to deposit Rs.2,50,000/- before the Court. The plaintiff also sought for Permanent Prohibitory Injunction to restrain the defendants from forcibly evicting the plaintiff from the plaint schedule property and from alienating the plaint schedule property and from inducting strangers into the plaint schedule property.
3.The defendants filed Written Statement with a Counter Claim seeking surrender of vacant possession of the Counter Claim property contending that, the suit is barred by limitation; that the allegation that the defendants are money lenders is incorrect;
- that the defendant No.1 purchased the plaint schedule property as per Ext.A3 sale deed for a sale consideration of Rs.15,00,000/-;
- that the property was mortgaged to State Bank with a liability of Rs.5,00,000/-; that the defendants advanced Rs.10,00,000/- to the plaintiff and they agreed to clear the bank liability; that the defendant No.1 cleared the bank liability on 22.07.2010; that plaintiff obtained title deed from the Bank and handed over the same to the 1st defendant; that the plaintiff wanted to reside in the property and hence executed Ext.B3 to B6 lease deeds in favour of the 1st defendant; that the claim for reconveyance of the property is without any merit; that Ext.A3 sale deed is valid; that the demand of the defendants to vacate from the building was not complied by the plaintiff and that the suit is liable to be dismissed.
- The defendants claimed recovery of possession of the counter claim building from the plaintiff.
4.The plaintiff filed a Written Statement to the Counter Claim raising the very same contentions which she raised in the Plaint.
5.The Trial Court dismissed the suit and allowed the Counter Claim directing the plaintiff to surrender vacant possession of the counter claim schedule property to the defendants within 30 days failing which the defendant is allowed to get the possession recovered through the Court at the cost of the plaintiff.
6.Though the plaintiff filed A.S.No. 109 of 2019 before the First Appellate Court, the same was also dismissed confirming the judgment and decree of the trial Court.
7.I heard the learned counsel for the appellant. The learned counsel for the appellant submitted that the Trial Court as well as the Appellate Court ought to have found that Ext.A3 document was given only as a security for the loan availed by
