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PETITIONER: SANTAKUMARI & ORS.

       Vs.

RESPONDENT: LAKSHMI AMMA JANAKI AMMA (D) BY LRS.  & ORS.

DATE OF JUDGMENT:       10/08/2000

BENCH: V.N. Khare, J. & S.N. Khare, J.

JUDGMENT:

S.  N.  VARIAVA,J.

       This Appeal is against a Judgment dated 7th August, 1987 in Second Appeal No.  313 of 1981.  Briefly stated the facts  are  as follows:  In 1939 the suit property came  to the  share of one Krishnan Nair by virtue of a partition in his  family.   As  the  family of Krishnan  Nair  had  been conducting  several  chit funds a number of debts had  been incurred   in  that  business,   several  suits  had   been instituted  and several decrees had been passed against the said  Krishnan Nair.  Krishnan Nair, therefore, executed  a Sale  Deed in 1940 selling the land to his  brother-in-law, one  Parameswaran Nair.  One of the decree holders got this property attached in execution of his decree.  Parameswaran Nair  filed objection claiming to be owner of the  property by  virtue  of  Sale  Deed executed  in  his  favour.   The Executing  Court held that the Sale Deed was sham and bogus and  that the same was a benami transaction.  The Executing Court  held that the property continued to remain vested in Krishnan  Nair.   The property was thus sold in  execution. Thereafter, Krishnan Nair filed a Petition to set aside the sale.  That Petition was dismissed.  However, Krishnan Nair was allowed to get back the property, provided he deposited the  decretal amount, interest and commission.  In order to raise  money  to so deposit Krishnan Nair then  executed  a Sale  Deed  in  favour  of  one  Kesavan  Channar  for  Rs. 1,200/-.   The Sale Deed provided that Krishnan Nair was to receive  a consideration of Rs.  1,200/- and the  purchaser was  to  pay  off  the   creditors.   This  Sale  Deed  was registered and Kesavan Channar was put in possession of the land.   On  the  same  day   and  simultaneously  with  the execution  of this Sale Deed another Agreement was executed by  Kesavan  Channar in favour of Kochu Kunja  Nair.   That Agreement   was   also    registered   simultaneously   and immediately  after  the  above mentioned Sale  Deed.   This Agreement provided that Kesavan Channar would sell the suit property  to  Kochu  Kunja Nair for a sum of  Rs.   1,400/- after  a period of 10 years, but before 11 years were over. It  must immediately be mentioned that the said Kochu Kunja Nair  was  a  relative of Krishnan Nair.  For the  sake  of convenience  hereinafter the Sale Deed in favour of Kesavan Channar  will referred to as Exhibit A-5 and the  Agreement to  Sell in favour of Kochu Kunja Nair will be referred  to as  Exhibit A-6.  Before the period of 10 years had expired Kesavan  Channar  expired and there was a partition in  his

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family.   The  suit  property  came to  the  share  of  his daughter,  one Lakshmikutty.  On 14th February, 1952  Kochu Kunja  Nair  assigned  his rights under Ext.   A-6  to  the predecessor  of  the  present Appellant.  For the  sake  of convenience  this  Deed of Assignment will  hereinafter  be referred  to as Exhibit A-7.  At the end of a period of  10 years  Lakshmikutty did not sell the property as  envisaged by  the Agreement Ext.  A-6.  Therefore, the predecessor in title  of  the  Appellant filed Suit No.  198 of  1957  for specific  performance  of Ext.  A-6.  It must be  mentioned that Krishnan Nair was made a party defendant to that Suit. He was Defendant No.  15.  That Suit came to be decreed and the  Appeal  filed by Lakshmikutty was  dismissed.   Second Appeal   filed   by  Lakshmikutty   was   also   dismissed. Therefore,  Lakshmikutty executed a Sale Deed in favour  of the  predecessor  of the Appellant on 9th July, 1964.   The predecessor  in  title  took  possession  of  the  property through  the  Court on 18th July, 1967.  On  27th  January, 1976  the daughter of Krishnan Nair field Suit No.  128  of 1976 for declaration that she was the owner of the property and  for  recovery  of  possession.  This  Suit  was  filed against  the predecessor in title of the Appellant  herein. The other heirs of Krishnan Nair were Defendants Nos.  2 to 6  in that Suit.  Those heirs did not actively  participate in that Suit.  Thus the real fight was between the daughter of  Krishnan  Nair  and  the predecessor in  title  of  the Appellant.   On 7th March, 1977 the Suit was decreed by the trial Court.  The trial Court held that the Sale Deed, Ext. A-5  was  a  genuine document and that it was  not  a  sham document.   The  trial Court held that Exts.  A-6  and  A-7 were  benami  documents,  which had been  entered  into  on behalf  of  Krishnan Nair.  The trial Court held  that  the predecessor  of  the  Appellant  was merely  a  trustee  of Krishnan  Nair.   The trial Court, however, found that  the predecessor  had spent considerable amounts and that it was necessary  to take accounts between the parties.  The trial Court  held that as there was no prayer to render  accounts the Suit could not be decreed until accounts were taken and the predecessor of the Appellant was paid the amounts spent by  him.   Therefore,  the  trial  Court  refused  to  give possession  to the daughter of Krishnan Nair.  Both parties went  in Appeal.  The Appellate Court disposed of both  the Appeals  by a common Judgment dated 19th April, 1980.   The Appellate  Court  held  that  once   the  trial  Court  had concluded  that  Ext.   A-5 was  genuine  it  automatically followed  that  Exts.  A-6 and A-7 were also  genuine.   On this basis the Appellate Court held that Exts.  A-6 and A-7 were  not  benami transactions and the predecessor  of  the Appellant  had a right to the suit property.  The Appellate Court,  therefore,  dismissed  the Suit.  The  daughter  of Krishnan  Nair filed a Second Appeal in which the  impugned Judgment  dated  7th August, 1987 has been passed.  By  the impugned  Judgment the High Court has held that the  nature of  the  transactions clearly indicated that Krishnan  Nair had  no  intention of selling of the property and  that  in order  to  meet his debts a device had been  formulated  by which  there was a notional sale to Kesavan Channar with  a condition  that  the  property would be sold back  after  a period  of  10 years.  The High Court held that taken as  a whole  the  transactions were in the nature of mortgage  by conditional  sale.   The  High   Court,  therefore,  passed preliminary  decree  for redemption and directed taking  of accounts.   It  is  this Judgment which has  been  assailed before  us.   It has been seriously contended by Mr.   Iyer that the High Court without formulating any question of law

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had  disposed  of  the  Second  Appeal  and  arrived  at  a conclusion that the transaction was mortgage by conditional sale  even though there was no pleading to this effect,  no prayer  to this effect and neither the trial Court nor  the first  Appellate court had come to any such conclusion.  It was  submitted that the High Court had interfered with  the concurrent  findings  of fact by the two Courts  below  and that,  therefore, the Judgment of the High Court should  be set  aside and the Appeal be made absolute.  We have  heard counsel for the parties.  We have read the Judgments of the Courts  below and all relevant documents.  It is to be seen that  the  suit was for a declaration that the daughter  of Krishnan  Nair is owner of the property and for recovery of possession.   The claim to ownership and possession was  on the  basis  of interpretation of the documents Exts.   A-5, A-6  and  A-7.  On an interpretation of the  documents  the trial  Court  has held that there was a sale in  favour  of Kesavan  Channar  but the subsequent Agreements Exts.   A-6 and  A-7  were merely benami transactions.  In  effect  the trial  Court was also saying, on the interpretation of  the three  documents, that the transaction was in the nature of mortgage  by  conditional sale.  The first Appellate  Court interfered merely on the ground that if Ext.  A-5 was found to be a genuine document it necessarily followed that Exts. A-6  and A-7 were also genuine transactions and not  benami transactions.   No reason appears to have been given by the first  Appellate  Court for coming to this conclusion.   We fail  to understand as to how merely because Ext.  A-5  was held  to be genuine it necessarily followed that Exts.  A-6 and  A-7  were not benami transactions.  In our  view,  the Judgment  of  the  first  Appellate  Court  appears  to  be erroneous  and  has rightly been set aside by the  impugned Judgment.   As is seen the question is of interpretation of the  three  documents.  It is not correct to say  that  the second  Appellate Court has not formulated the question  of law.   The second Appellate Court has categorically  stated that  there  is a substantial question of law  between  the parties inasmuch as the construction of the documents under which  the  claim  to  property is made  is  a  substantial question of law.  That construction of documents would be a substantial  question  of  law  is   now  a  well   settled proposition.  This proposition has been settled as far back as  the Judgment of the Privy Council in the case of  Guran Ditta v.  T.  Ram Ditta reported in AIR 1928 P.C.  172.  It has  since  been re-affirmed by this Court in the  case  of Kochukaskkada Aboobacker v.  Attam Kasim reported in (1996) 7 S.C.C.  389 and the case of Neelu Narayani v.  Lakshmanan reported in (1999) 9 S.C.C.  237.  Thus we see no substance in  the  contention  that  no  question  of  law  had  been formulated.   Let  us then see whether  the  interpretation placed  by the trial Court and the High Court on Exts  A-5, A-6 and A-7 is correct.  The facts leading to the execution of these documents, the manner in which these documents are executed  are  all  very relevant.  As  stated  above,  the property  had been sold in execution of a decree.  Krishnan Nair  was,  however, given an opportunity to get  back  the property  provided  he  deposited   the  decretal   amount, interest  and the commission.  Krishnan Nair being  heavily debted  did  not  have  the money.  It is  clear  that  he, therefore,  devised  a method of executing a Sale  Deed  in favour of Kesavan Channar, i.e.  Ext.  A-5 with a condition that  the  property be resold after 10 years.  It is to  be remembered  that at that time the Transfer of Property  Act did  not  operate in the State of Travancore and  only  the general  principles  of that Act, based on justice,  equity

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and  good  conscience, were applicable.  It is  clear  that even though the Sale Deed was executed Krishnan Nair had no intention  to  permanently dispose of the property.  It  is clear  from the fact that simultaneously with the execution of Ext.  A-5 the purchaser, i.e.  Kesavan Channar, executed a  second  Agreement  Ext.   A-6.    Unless  there  was  no intention  to  re-convey  there would be no question  of  a purchaser  simultaneously  executing the Agreement to  Sell the  property  after  10  years.  The  two  documents  were executed  immediately  one  after the other and  were  also registered simultaneously one after the other.  There would not  be  two such documents executed simultaneously  unless the intention was that the property was to be reconveyed to the vendor i.e.  Krishnan Nair.  It is significant that the proposed  purchaser, in Ext.  A-6, was a close relative  of Krishnan  Nair.  It is also relevant that Kochu Kunja  Nair at  the time of execution of Ext.  A-6 was already 72 years of  age.  This makes it clear that Ext.  A-6 was for and on behalf of Krishnan Nair.  This Deed of assignment in favour of  the  predecessor in title of the Appellant, i.e.   Ext. A-7,  by  Kochu  Kunja Nair shows that Ext.  A-6  had  been executed  at  the  instance  of   the  predecessor  of  the Appellant.   This further indicates that the predecessor of the  Appellant was aware of the fact that the property  was being  sold  to  Kesavan  Channar under Ext.   A-5  with  a condition  that the same would be sold back after a  period of 10 years to Kochu Kunja Nair who was acting on behalf of Krishnan  Nair.  The predecessor of the Appellant was aware that the property had been taken on behalf of Krishnan Nair and he himself took the property on behalf of Krishnan Nair probably  due  to the old age of Kochu Kunja Nair.  In  our view,  it  cannot  be said that the findings of  the  trial Court  and  the second Appellate Court that  the  documents Exts.  A-5, A-6 and A-7 are not what they purport to be and that  they  had been executed with the intention  that  the property  would be re-conveyed to Krishnan Nair is perverse and/or  illogical.  In our view it cannot be said that such an  interpretation,  of these documents, could  never  have been arrived at.  The second Appellate Court was confirming the  findings  of the trial Court.  Therefore it cannot  be said   that  the  second   Appellate  Court  has   reversed concurrent findings of fact.  The second Appellate Court by stating  that  this is a mortgage by conditional  sale  has merely put a form to the transaction.  Taken as a whole the transaction  appears to be a mortgage by conditional  sale. The  second Appellate Court is not making out any new  case but is merely interpreting the documents and putting a form to  the nature of the transactions.  We, therefore, find no reason  to interfere.  The Appeal stands dismissed.   There will be no order as to costs.