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1968 Supreme(SC) 12

SUPREME COURT OF INDIA
J.C. SHAH AND V. RAMASWAMI, JJ.
Ningawwa, Appellant
Versus
Byrappa Shiddappa Hireknrabar and others, Respondents.
Civil Appeal No. 586 of 1965,
D/- 17-1-68.
Advocates appeared
K. R. Chaudhuri, Advocate for, Appellant; Naunitlal, Advocate, for Respondents.

Advocates:
K.R.CHAUDHARY, NAUNIT LAL

Headnote:a transaction is void if there is some fraud, misrepresentation or mistake as to the character of the document —it is voidable if there is fraud, misrepresentation or mistake about its contents —it however depends upon the facts and circumstances of each particular case

       

Judgement Key Points

Key Points: - The judgment held that a gift transaction obtained by fraud is voidable, not void, and may be set aside under Article 95 of the Limitation Act depending on discovery of the fraud (!) (!) - It distinguishes fraud as to the contents of the document from fraud as to the character of the document; only the former makes the transaction voidable, while the latter renders it void (!) - For plots 91 and 92 (Lingadahalli village), the fraud was not known to the plaintiff until after the husband’s death; suit filed within three years of discovery under Article 95; thus time bar did not apply for those plots (!) - For plots 407/1 and 409/1 (Tadavalga village), the trial court found undue influence and a lack of knowledge about the fraud; Article 91 applies, with a three-year period from when the facts entitling cancellation were known; court held suit barred due to knowledge at the time of execution or due to the statutory constraint, rejecting a claim that period should run from later escape from influence; Someshwar Dutt principle cited (!) - Burden of proving good faith in transactions where one party stands in a position of active confidence rests on the party in that position (Section 16(3) Indian Contract Act and Section 111 Evidence Act) (!) (!) - Appellate court concluded gift deed as to plots 91 and 92 Lingadahalli was obtained by fraud and set aside; appellant granted possession and mesne profits; appeal allowed (!)

What is the effect of fraud on a gift deed: void, voidable, or valid?

What are the applicable limitation periods to challenge a gift deed obtained by undue influence, and when do those periods start?

What is the proper burden of proof regarding undue influence and the character of a document, and how does that affect void vs voidable status?


Judgement

RAMASWAMI, J.: This appeal is brought, by certificate, from the judgment of the Mysore High Court dated July 29, 1960 in R. A. (B) 71 of 1956, whereby the High Court allowed the appeal of the respondents and dismissed the suit of the appellant.

2. In the suit which is the subject-matter of this appeal the appellant asked for a decree for possession of the properties mentioned in the schedule to the plaint on the ground that she was the owner of the properties in spite of the gift deed, Ex. 45 executed by her on January 16. 1938. According to the case of the appellant, plots Nos. 91 and 92 of Lingadahalli village were inherited by her from her father and plots Nos. 407/1 and 409/1 of Tadavalga village were originally the properties of her husband Shiddappa. These plots had been usufructually mortgaged but they were redeemed from the funds supplied by the appellant and a reconveyance of the two plots was taken in the name of the appellant. At about the time Ex. 45 was executed it is alleged by the appellant that her husband Shiddappa was dominating her will and persuaded her to execute the gift deed in respect of plots 407/1 and 409/1 of Tadavalga village. The appellant was taken to Bijapur by her husband on January 16, 1938 and there Ex. 45 was written and she was made to sign it. The document was registered on January 18, 1938 at Indi. The appellant believed that the document, Ex. 45 related to only plots Nos. 407/1 and 409/1 of Tadavalga village. She was never told by her husband that the document related either to plot No. 91 or plot No. 92 of Lingadahalli village. Shiddappa died in about the end of December, 1949 and till then she was amicably living with him and consequently she had no occasion to know about the true character of Ex. 45 or about its contents. Shiddappa had taken a second wife in the year 1941 and after the death of Shiddappa in 1949 the relations of the second wife, respondent No. 4 began to assert their rights in respect of the properties of the appellant. Growing suspicious of the conduct of the respondents, the appellant made enquiries from the Karnam of the village and found that in Ex. 45 she was purported to have made a gift of properties included in plots 91 and 92 of Lingadahalli village to her husband Shiddappa. Consequently the appellant brought the present suit for possession of properties. Respondent No. 4 is the second wife of Shidddappa and respondents 1 to 3 are the children of Shiddappa through respondent No. 4. They resisted the appellant s suit and contended that the gift deed in favour of Shiddappa, Ex. 45 was valid and that the same was executed voluntarily by the appellant and consequently it was not liable to be set aside. The trial court came to the conclusion that Shiddappa obtained Ex. 45 by the exercise of undue influence over the appellant, that he had represented to her that it related only to plots Nos. 407/1 and 409/1 of Tadavalga village and he had fraudulently included in the document plots Nos. 91 and 92 of Lingadahalli village. The trial court, however, dismissed the appellant s suit in respect of plots Nos. 407/1 and 409/1 on the ground that the suit was barred under Article 91 of the Limitation Act. With regard to plots 91 and 92 of Lingadahalli village the trial court gave a decree in favour of the appellant. The respondents took the matter in appeal to the Mysore High Court. The appellant filed cross-objections against the decree of the trial court. By its judgment dated July 29, 1960, the High Court allowed the appeal and dismissed the cross-objections thereby dismissing the suit of the appellant in its entirety. The High Court confirmed the finding of the trial court so far as plots Nos. 407/1 and 409/1 of Tadavalga village were concerned and held that the suit was barred by limitation as it was not filed within three years of the execution of the deed. As regards plots Nos. 91 and 92 of Lingadahalli village the High Court held that the alleged fraud had not













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