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2025 Supreme(Online)(MP) 9068
HIGH COURT OF MADHYA PRADESH
G. S. Ahluwalia, J
Syed Habib Shah – Appellant
Versus
Mumtaz Jahan Begum – Respondent
FIRST APPEAL No. 5 of 1976
For the Appellants/Petitioners: Anil Kumar Mishra, Sanjay Kumar Sharma
For the Respondents: Santosh Agrawal, B.D. Jain, Tej Singh Mahdik, Prakhar Dhengula
A fiduciary relationship between siblings shifts the burden of proof to the dominant party to show that any renunciation of property rights obtained by them was not the result of undue influence, especially when the transaction appears unconscionable and is demonstrated to be a sham.
Headnote:(A) Contract Act - Section 16 - Undue Influence - Fiduciary relationship between siblings - Burden of proof shifts to the party in a position of dominance when a transaction appears unconscionable - A renunciation of a future interest in property by an expectant heir is not a legally enforceable transfer under principles of personal law when obtained through improper influence. (Paras 37, 43, 46, 54, 66, 81, 87)
(B) Evidence Act - Section 92 - Exclusion of evidence - Extrinsic evidence to prove a document is a sham or executed under undue influence is admissible under Proviso (1) - Section 92 does not bar parties from establishing that a document was never intended to be acted upon and does not represent the real agreement. (Paras 76, 77)
(C) Appeal - Scope - Powers of first appellate court under Section 96, Code of Civil Procedure - Obligation to independently consider evidence and correct material illegality in trial court findings - Appellate court must re-evaluate facts when the lower court fails to consider the nature of fiduciary relations and the validity of a transaction. (Paras 31, 33, 108)
Facts of the case:
An action was initiated seeking a declaration that a renunciation deed executed in favor of an elder sibling was null and void due to undue influence and a total lack of consideration. The civil court originally dismissed the suit, categorizing the document as a valid relinquishment deed. The appellate court reviewed the evidence, considering the fiduciary relationship between the siblings and prior partition decrees determining shares in the estate.
Findings of Court:
The court determined that the sibling holding the dominant position in the fiduciary relationship induced the execution of the deed. The respondents failed to discharge the burden of proving that the execution was free and voluntary. Conclusively, the deed was identified as a sham instrument intended to obstruct earlier legal proceedings, leading to the decree of the suit in favor of the heirs of the claimant.
Issues: The central questions were whether the renunciation deed was obtained through undue influence; whether it constituted a valid relinquishment of property rights; and whether the burden of proving the absence of undue influence shifted to the beneficiary.
Ratio Decidendi: Where a relationship involves trust and one party acts to secure a benefit that is on its face unconscionable, the burden of proving that the contract was not induced by undue influence rests upon the beneficiary. A renunciation deed obtained during the pendency of litigation to frustrate established share rights, and kept hidden from prior judicial notice, is deemed invalid and ineffective in law.
Result: Appeal allowed.
| Table of Content |
|---|
| 1. appellate court duty to decide on merits despite record destruction. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 11 , 13 , 15 , 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29) |
| 2. establishing undue influence and fiduciary relationships in family transactions. (Para 10 , 12 , 14 , 16 , 17 , 34 , 35 , 36 , 37 , 38 , 39 , 40 , 41 , 42 , 43 , 44 , 45 , 46 , 47 , 48 , 49 , 50 , 51 , 52 , 53 , 54 , 55 , 56 , 57 , 58 , 59 , 60 , 61 , 62 , 63 , 64 , 65 , 66 , 78 , 79 , 80) |
| 3. appellate powers to consider additional evidence for justice. (Para 18 , 19 , 20 , 30 , 31 , 32 , 33 , 92 , 93 , 94 , 95 , 96 , 97 , 98 , 99 , 100 , 101 , 102 , 103 , 104 , 105 , 106 , 107 , 108) |
| 4. inadmissibility of parol evidence for sham documents and invalidity of spes successionis transfers. (Para 67 , 68 , 69 , 70 , 71 , 72 , 73 , 74 , 75 , 76 , 77 , 81 , 82 , 83 , 84 , 85 , 86 , 87 , 88 , 89 , 90 , 91 , 109 , 110 , 111 , 112) |
JUDGMENT
1. This First Appeal under Section 96 of CPC has been filed against the Judgment and Decree dated 6-1-1973 passed by Additional District Judge, Gwalior in C.S. No. 3-A/1971.
2. The appellants are the legal representatives of the plaintiff who have lost their case from the Trial Court.
3. Before considering the merits of the case, this Court would like to mention certain facts which are necessary to be discussed in the light of I.A. No. 8240 of 2025 filed by respondents for dismissal of this appeal on the ground of non-availability of original record. Although this application was dismissed by this Court by order dated 6-11-2025, but the Counsel for respondent no. 2(i) once again raised the question of non-availability of original record during the course of final arguments. Although the objection raised by Counsel for respondent no. 2(i) shall be considered in detail in the later part of this judgment, but this Court would like to mention about the non-cooperation on the part of the respondents in reconstruction of original record.
4. This First Appeal was filed on 7-3-1973. Thereafter, on 28-7-1989, this appeal was dismissed for want of prosecution. Thereafter, this appeal was restored to original file. Thereafter, multiple round of litigations took place in the form of review etc. against the order of restoration/readmission, but ultimately, the Supreme Court by order dated 23-8-2024 passed in SLP (Civil) No. …… 2024 (Diary No. 2967 of 2019), remanded the matter back to the High Court for judgment on merits.
5. Although, the Counsel for the parties continued to appear after remand, but later on, they started pleading no instructions, as a result fresh notices were issued to the parties. When all the respondents were not being served, then the notices were served by substituted mode by publication. It appears that all the facts were not being disclosed during the consideration of interlocutory applications, therefore, on 24-7-2025 it was observed by this Court, that “With heavy heart, it is being observed that all these facts were initially suppressed by the Lawyers, and only when this court was hearing MCC No. 4122 of 2025, then it came to know about the fact that certain other S.L.P.S were also filed before the Supreme Court.” Thereafter, when the arguments began on 31-7-2025, it was found that the entire record of the Trial Court has not been received and accordingly, the Principal District and Sessions Judge, Gwalior was directed to ensure that the entire record is sent. Thereafter, a memo was received from the office of Principal District and Sessions Judge, Gwalior that by retaining some of the original documents, the remaining record of the Trial Court has already been destroyed in the year 2006. In order dated 6-8-2025, it was observed by this Court that the record was destroyed in the year 2006 as this appeal was dismissed for want of prosecution on 28-7-1989 and the appeal was readmitted for hearing by order dated 6-11-2012. Accordingly, this Court was left with no other option, but to request the Counsel
