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MADURAI BENCH OF MADRAS HIGH COURT
C.RAJENDRAN – Appellant
Versus
Ramaiah – Respondent
AS(MD) 130 2021
SALE DEED - SHAM AND NOMINAL - MORTGAGE - LOAN TRANSACTION - BURDEN OF PROOF - SPECIFIC PERFORMANCE - REDEMPTION - TRANSFER OF PROPERTY ACT, SECTION 58(C) - Where the plaintiffs have admitted that there was an agreement to re-convey in their favour under Ex.A.3, it can very well be inferred that the plaintiffs have impliedly admitted the sales under Ex.A.1 and Ex.A.2 in favour of the defendant and without admitting the same, the question of seeking or demanding to re-transfer the property will not arise.
Fact of the Case:
The plaintiffs filed a suit for declaration and permanent injunction, alleging that the sale deeds dated 17.01.2014 in favour of the defendant were sham and nominal documents and that they were the owners of the property. The defendant contended that the sale deeds were true, genuine, valid and supported by valid consideration, and that the plaintiffs were estopped from challenging the registered sale deeds executed by them.
Finding of the Court:
The Court held that the plaintiffs had failed to prove that there existed a loan transaction between them and the said Saminathan. As rightly contended by the learned counsel appearing for the defendant, in the absence of any loan transaction, the question of executing sale deeds as security for loan transaction does not arise at all. Except the above, the plaintiffs have not canvassed any other reason or ground for executing the sale deeds under Ex.A.1 and Ex.A.2, without any intention to convey the property.
Issues: 1) Whether the sale deeds dated 17.01.2014 were executed by the plaintiffs in favour of the defendant nominally as the security for the loan borrowed from one Saminathan?2) Whether the plaintiffs are entitled to the relief of declaration as to the sale deeds dated 17.01.2014 executed by them in favour of the defendant as sham and nominal ones?3) Whether the plaintiffs are entitled to the relief of permanent injunction as prayed for?4) What relief the plaintiffs are entitled to?5) To what other reliefs, the parties are entitled to?
Ratio Decidendi: The Court relied on the judgment of the Hon'ble Supreme Court in Raj Kishore (dead) by L.Rs Vs. Prem Singh and others reported in AIR 2011 SC 382, wherein it was held that the principle stated by the Federal Court in Ardeshir H. Mama v. Flora Sassoon AIR 1928 PC 208 to the effect that time is not normally the essence of the contract in contracts relating to immovable property did not apply to contracts for re-conveyance of the immovable property.
Final Decision: The Court allowed the appeal and set aside the impugned judgment and decree passed in O.S.No.289 of 2018 dated 01.03.2021. The suit in O.S.No.289 of 2018 was dismissed. Parties were directed to bear their own costs.
A.S.(MD)No.130 of 2021
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
Reserved on : 22.08.2023
Pronounced on : 30.11.2023
CORAM:
THE HON'BLE MR.JUSTICE K.MURALI SHANKAR
A.S.(MD)No.130 of 2021
C.Rajendran
... Appellant/
Defendant
Vs.
1. Ramaiah
2. Manimekalai
... Respondents/
Plaintiffs
PRAYER : This Appeal Suit filed under Section 96 of C.P.C., to set aside
the judgment and decree dated 01.03.2021 made in O.S.No.289 of 2018 on
the file of the 1st Additional District Judge, Madurai by allowing this
appeal and thereby dismissed the suit with cost throughout.
For Appellant
: Mr.N.Palanisamy
For Respondents
: Mr.G.Aravinthan
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A.S.(MD)No.130 of 2021
JUDGMENT
The Appeal Suit is directed against the judgment and decree passed
in O.S.No.289 of 2018 dated 01.03.2021 on the file of the I Additional
District Court, Madurai.
2. The suit is for declaration and for permanent injunction.
3. For the sake of convenience and brevity, the parties herein after
will be referred to as per their status/ranking before the trial Court.
4. The case of the plaintiffs is that the plaintiffs have purchased a
land to an extent of measuring 1.04 acres in Navinipatti Village, Melur
Taluk, vide sale deed dated 13.11.1991 and they have been in possession
and enjoyment of the same, that due to the matrimonial dispute between
the plaintiffs' son and daughter-in-law, their daughter-in-law lodged a
police complaint with regard to pledging of her jewels and the police, after
enquiry, directed the plaintiffs to arrange money for redeeming jewels or
else case will be registered and hence, the plaintiffs approached the
defendant, who was working as a Secretary in the village panchayat and he
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A.S.(MD)No.130 of 2021
arranged loan of Rs.10 lakhs from one Saminathan-former President of the
panchayat, that when they visited the register office for executing a
mortgage deed, the defendant informed them that they have to execute a
sale deed in favour of the said Saminathan, for which, the plaintiffs had
raised objection that they cannot execute a sale deed for the loan of Rs.10
lakhs, in respect of the property worth about Rs.28 lakhs, that the said
Saminathan has informed that the plaintiffs can execute a sale deed only
with respect to 1 acre of land and that too in the name of the defendant,
known person to both the parties and after repayment of loan amount, the
plaintiffs can take a re-conveyance deed, that since the plaintiffs were
compelled, with no other option, they have executed two sale deeds dated
17.01.2014 in favour of the defendant one in respect of 43 cents and the
other one in respect of 61 cents on that day itself, that the defendant
executed an agreement to re-convey the property, that the said Saminathan
has given Rs.8,85,000/- after deducting interest and stamp duty expenses,
that the plaintiffs paid monthly interest of Rs.20,000/- regularly to the said
Saminathan., that the plaintiffs are in possession and enjoyment of the
property and they are doing agricultural work, that the said Saminathan
was murdered in the year 2017 and the defendant demanded the principal
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A.S.(MD)No.130 of 2021
amount and interest by informing that there were disputes in the family of
the said Saminathan, but subsequently the defendant taking advantage of
the death of the said Saminathan demanded huge sum of Rs.40,16,128/-
from the plaintiffs to re-convey the lands in the names of the plaintiffs,
that the plaintiffs have then issued a legal notice, for which, the defendant
has sent a reply notice with false and untenable allegations, that the
plaintiffs have also lodged a police complaint and on that basis, FIR came
to be registered in Crime No.537 of 2018 on the file of Melur Police
Station, that since the Government has initi
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