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PETITIONER: IDHYADHAR

       Vs.

RESPONDENT: MANKIKRAO & ANR.

DATE OF JUDGMENT:       17/03/1999

BENCH: D.P.Wadhwa, S. Saghir Hamad

JUDGMENT:

S.SAGHIR AHMAD, J.

Leave granted.

     Vidhyadhar,  the  appellant  before   us,  who   shall hereinafter  be  referred to as plaintiff, had instituted  a suit  against  the  respondents, who  shall  hereinafter  be referred  to  as defendant Nos.  1 and 2  respectively,  for redemption  of  the mortgage by conditional sale or  in  the alternative  for  a decree for specific performance  of  the contract for repurchase which was decreed by the trial court on  29.4.1975.  The decree was upheld by the Lower Appellate Court by its judgment dated 28.9.1976 but the High Court, by the  impugned  judgment dated 3.5.1991, set aside  both  the judgments  and  passed a unique order to which  a  reference shall  be made presently in this judgment.  The plaintiff is in appeal before us.

     The  property  in  dispute is 4.04 acres  of  land  of survey plot No.  15 of Kasba Amdapur, District Buldana.  The whole  area  of survey plot No.15 is 16.09 acres and  except the  land  in  dispute, namely, an area of 4.04  acres,  the entire  land  is in possession of the plaintiff.   Defendant No.2  was  the  owner of the whole Plot No.15.  On  24th  of March, 1971, he executed a document styled as "Kararkharedi" in  favour  of defendant No.1 for a sum of Rs.   1500/-  and delivered  possession  thereof to the latter.  There  was  a stipulation  in  the document that if the entire  amount  of Rs.1500/-  was  returned  to defendant No.1 before  15th  of March,  1973, the property would be given back to  defendant No.2.   This land was subsequently transferred by  defendant No.2 in favour of the plaintiff for a sum of Rs.5,000/- by a registered sale deed dated 19.6.1973.

     After  having  obtained the sale deed,  the  plaintiff filed  the  aforesaid  suit in which it was given  out  that defendant  No.2  had offered the entire amount to  defendant No.1  but  the  latter  did   not  accept  the  amount  and, therefore,  defendant No.2 had to send it by money order  on 7.6.1973  which  was refused by defendant No.1.   A  notice, dated  5.6.1973,  had  also been sent by defendant  No.2  to defendant  No.1.   It was pleaded that since  the  document, executed  by defendant No.2 in favour of defendant No.1, was

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a  mortgage by conditional sale, the property was liable  to be redeemed.  It was also pleaded in the alternative that if it  was held by the Court that the document did not create a mortgage  but  was  an out and out sale,  the  plaintiff  as transferee  of defendant No.2, was entitled to a decree  for reconveyance  of the property as defendant No.2 had  already offered the entire amount of sale consideration to defendant No.1  which,  the latter, had refused and which  amount  the plaintiff  was still prepared to offer to defendant No.1 and was  also otherwise ready and willing to perform his part of the  contract.   Defendant No.2 admitted the whole claim  of the  plaintiff by filing a one-line written statement in the trial  court.   But  defendant No.1 contested the  suit  and pleaded  that the document in his favour was not a  mortgage by  conditional  sale but was an out and out sale and  since the amount of consideration had not been tendered within the time  stipulated  therein,  the plaintiff  could  not  claim reconveyance  of the property in question.  The trial  court framed the following issues:-

     "1.   Does the plaintiff prove that the defendant No.2 mortgaged  the  suit  field  with  the  defendant  No.1  for Rs.1500/- on 24.3.71?

     2.   Does the plaintiff prove that the suit field  was purchased  by him from the defendant No.2 for Rs.5,000/-  on 19.6.73?

     3.   Is the plaintiff entitled to redeem the  mortgage executed by the defendant No.2 in favour of defendant No.1?

     4.   Was  the  defendant No.  2 ready and  willing  to repurchase the suit field prior to 15.3.71?

     5.   Is the plaintiff entitled to claim retransfer  of the suit field from the defendant No.1?

     6.  Relief and costs?"

     The  finding on issue No.1 was that defendant No.2 had mortgaged  the  land  in  question  to  defendant  No.1  for Rs.1500/-  on  24.3.1971.  On issue No.2, it was found  that defendant No.2 had transferred the property in favour of the plaintiff  for  a  sum  of  Rs.5,000/-  on  19.6.1973  by  a registered  sale  deed  and, therefore,  the  plaintiff  was entitled  to redeem the mortgage executed by defendant  No.2 in  favour  of  defendant No.1.  Issue Nos.  4  and  5  were decided  in  the  negative as the trial court had  held  the document  in  question  to be a mortgage deed.  In  view  of these  findings,  the suit was decreed and the  trial  court passed the following order:-

     "It  is  hereby  declared that the amount due  to  the defendant-1  on  the mortgage mentioned in the plaint  dated 24-3-71  is  Rs.1500/-.  It is further ordered  and  decreed that  the plaintiff to pay into court on or before  29-10-75

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or  any  later  date  into which time  for  payment  may  be extended by the Court the said sum of Rs.1500/-.

     That  on such payment and on payment thereafter before such  date as the Court may fix of such amount as the  Court may  adjudge  due interest as may be payable under rule  10, together  with  such subsequent interest as may  be  payable under  rule 11 of the order 34 of the first schedule to  the Code  of  Civil Procedure 1908, the defendant-1 shall  bring into Court all documents in his possession or power relating to  the  mortgage property in the plaint mentioned  and  all such  documents shall be delivered over to the plaintiff  or to such person as he appoints, and the defendant-1 shall, if so  required, reconvey or retransfer the said property  from the  said  mortgage and clear of and from  all  encumbrances created  by the defendant-1 or any person claiming under him or  any  person  under  who he claims,  and  free  from  all liability  whatsoever arising from the mortgage or this suit and  shall,  deliver  up the plaintiff  quiet  and  peaceful possession  of the said property.  And it is further ordered and  decreed - that, in default of payment as aforesaid, the defendant-1  may apply to the Court for a final decree  that the  plaintiff  be  debarred from all right  to  redeem  the property."

     This  decree  was confirmed in appeal but, as  pointed out  above,  was  reversed by the High Court in  the  second appeal.

     The  High Court was of the opinion that the  plaintiff had  not  paid  the entire amount of sale  consideration  to defendant  No.2.  Out of a sum of Rs.5,000/-, for which sale deed  was executed, a sum of Rs.500/- alone had been paid to defendant  No.2 before the Sub-Registrar and the rest of the amount  was not paid.  The High Court further held that  the document "Kararkharedi" which purports to have been executed for  a  sum  of  Rs.1500/- by defendant No.2  in  favour  of defendant  No.1 was, in fact, executed for a sum of Rs.800/- which  was  paid before the Sub-Registrar.  The High  Court, then,  disposed  of the suit by directing that the  land  in question  shall be restored to defendant No.2 who shall  pay back  a  sum of Rs.800/- (in instalments) to defendant  No.1 and a sum of Rs.500/- (in instalments) to the plaintiff.

     Learned  counsel for the appellant has contended  that the  sale deed, executed by defendant No.2 in favour of  the plaintiff,  was not challenged by defendant No.2 who, on the contrary,  had  admitted  the entire claim set  out  by  the plaintiff  in his plaint and, therefore, the High Court  was in  error  in  setting  aside the sale  deed.   It  is  also contended  that  defendant No.1 who had challenged the  sale deed as fictitious had not appeared as a witness in the case and   had  avoided  the  witness   box  in  order  to  avoid cross-examination  and,  therefore,  an  adverse   inference should  have  been drawn against him and this plea ought  to have  been  rejected  by the High Court which,  it  is  also contended,  could not have legally set aside the findings of fact  in second appeal.  It is also contended that defendant No.1  being a stranger to the sale deed should not have been

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allowed  to  raise  the  plea   relating  to  inadequacy  or non-payment of consideration money.

     Learned  counsel for defendant No.1, on the  contrary, has  tried to justify the interference by the High Court  at the  stage of second appeal by contending that the  findings recorded by the Courts were not borne out by the evidence on record  and  were  perverse which could be set  aside  under Section  100 C.P.C.  He also contended that the document  of title  in favour of defendant No.1 was misread as a mortgage deed although it constituted an out and out sale.  Moreover, on  the  commission  of  default,  as  contemplated  by  the document  in question, the whole transaction, even if it was a mortgage, converted itself into an absolute sale as agreed upon  between  the  parties.  The sale  having  thus  become absolute  in favour of defendant No.1, no title was left  in defendant  No.2  to convey it to the plaintiff  through  the sale deed in question.

     Let  us examine the respective contentions.  Beginning with  the pleadings, defendant No.2 in his written statement filed  before  the  trial court, admitted the claim  of  the plaintiff.

     Annexure  P-III  to the Special Leave Petition is  the true  translation of the copy of written statement filed  by defendant No.2 in the suit.  It reads as under:-

     "IN  THE COURT OF HON’BLE CIVIL JUDGE SENIOR  DIVISION BULDANA:-

     R.C.  S.No.195/73 F.F.__________

     Plaintiff :  Vidhyadhar Vishnupant Ratnaparkhi

     - Versus -

     Defendant  :   1) Manikrao Babarao Deshmukh  2)  Pandu Ganu Bhalerao

     -  WRITTEN  STATEMENT  OF DEFENDANT  NO.2  PANDU  GANU BHALERAO

     1)  The  suit filed by Plaintiff is  admitted.   Hence this written statement.

     Buldana Dt.20.12.73

     Sd/- ( Pandu Ganu Bhalerao ) I, defendant No.  2 state on oath that the contents of para 1 of the written statement are true as per my personal knowledge.

     Hence this affidavit is signed and executed at Buldana on this 20.12.73.

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     Sd/-  (  Pandu  Ganu Bhalerao )" The  Lower  Appellate Court  has  noticed  this and observed in  its  judgment  as under:-

     "Defendant  No.2 filed his written statement at  Ex.15 which is extremely brief comprising only a sentence, stating that the suit filed by the plaintiff is admitted by him."

     Even while plaintiff was in the witness box, defendant No.2  declined  to cross examine the plaintiff  which  shows that  defendant  No.2  after  admitting   the  case  of  the plaintiff, had no interest in the litigation particularly as he  had  already transferred the property in favour  of  the plaintiff.

     It  was  defendant  No.1 who contended that  the  sale deed, executed by defendant No.2 in favour of the plaintiff, was  fictitious  and  the  whole  transaction  was  a  bogus transaction as only Rs.500/- were paid as sale consideration to  defendant  No.2.   He further claimed  that  payment  of Rs.4,500/-   to   defendant  No.2   his  home   before   the registration  of  the deed was wholly incorrect.  This  plea was not supported by defendant No.1 as he did not enter into the  witness box.  He did not state the facts pleaded in the written statement on oath in the trial court and avoided the witness  box so that he may not be cross examined.  This, by itself,  is enough to reject the claim that the  transaction of sale between defendant No.2 and the plaintiff was a bogus transaction.

     Where  a  party to the suit does not appear  into  the witness  box  and states his own case on oath and  does  not offer  himself  to  be cross examined by the other  side,  a presumption  would arise that the case set up by him is  not correct  as has been held in a series of decisions passed by various High Courts and the Privy Council beginning from the decision  in  Sardar Gurbakhsh Singh vs.  Gurdial Singh  and another,  AIR 1927 Privy Council 230.  This was followed  by the  Lahore High Court in Kirpa Singh vs.  Ajaipal Singh and others,  AIR  1930  Lahore 1 and the Bombay  High  Court  in Martand  Pandharinath  Chaudhari  vs.   Radhabai  Krishnarao Deshmukh, AIR 1931 Bombay 97.  The Madhya Pradesh High Court in  Gulla  Kharagjit  Carpenter  vs.   Narsingh  Nandkishore Rawat,  AIR 1970 Madhya Pradesh 225 also followed the  Privy Council  decision in Sardar Gurbakhsh Singh’s case  (supra). The  Allahabad High Court in Arjun Singh vs.  Virender  Nath and  another,  AIR  1971 Allahabad 29 held that if  a  party abstains  from entering the witness box, it would give  rise to  an inference adverse against him.  Similarly, a Division Bench of the Punjab & Haryana High Court in Bhagwan Dass vs. Bhishan  Chand and others, AIR 1974 Punjab & Haryana 7, drew a  presumption under Section 114 of the Evidence Act against a  party who did not enter into the witness box.   Defendant No.1  himself  was  not a party to the transaction  of  sale between defendant No.2 and the plaintiff.  He himself had no personal  knowledge  of the terms settled between  defendant No.2  and the plaintiff.  The transaction was not settled in his presence nor was any payment made in his presence.  Nor,

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for that matter, was he a scribe or marginal witness of that sale  deed.   Could, in this situation, defendant No.1  have raised  a  plea as to the validity of the sale deed  on  the ground  of  inadequacy  of   consideration  or  part-payment thereof?  Defendant No.2 alone, who was the executant of the sale deed, could have raised an objection as to the validity of  the  sale  deed  on  the  ground  that  it  was  without consideration  or  that  the consideration paid to  him  was highly inadequate.  But he, as pointed out earlier, admitted the claim of the plaintiff whose claim in the suit was based on  the sale deed, executed by defendant No.2 in his favour. The  property having been transferred to him, the  plaintiff became  entitled  to all the reliefs which could  have  been claimed  by defendant No.2 against defendant No.1  including redemption of the mortgaged property.

     Learned  counsel  for  defendant No.1  contended  that since  the plaintiff had filed the suit on the basis of sale deed,  executed  by  defendant No.2 in his  favour  and  had sought possession over that property from defendant No.1, it was  open to the latter to show that plaintiff had no  title to  the property in suit and, therefore, the suit was liable to be dismissed.  It was contended that in his capacity as a defendant  in  the  suit, it was open to defendant  No.1  to raise  all the pleas on the basis of which the suit could be defeated.

     In  Lal  Achal Ram vs.  Raja Kazim Hussain Khan,  1905 (32)  Indian  Appeals 113, the Privy Council laid  down  the principle  that  a  stranger to a sale deed  cannot  dispute payment of consideration or its adequacy.  This decision has since  been  considered  by  various   High  Courts  and   a distinction has been drawn between a deed which was intended to be real or operative between the parties and a deed which is  fictitious  in  character and was never  designed  as  a genuine  document  to effect transfer of title.  In  such  a situation,  it  would be open even to a stranger to  impeach the  deed as void and invalid on all possible grounds.  This was also laid down in Kamini Kumar Deb vs.  Durga Charan Nag &  Ors.,  AIR  1923  Calcutta 521  and  again  in  Saradindu Mukherjee  vs.   S.M.   Kunja Kamini Roy &  Ors.,  AIR  1942 Calcutta  514.  The Patna High Court in Jugal Kishore Tiwari & Anr.  vs.  Umesh Chandra Tiwari & Ors., AIR 1973 Patna 352 and  the  Orissa High Court in Sanatan Mohapatra and  others vs.   Hakim  Mohammad  Kazim Mohammad and others,  AIR  1977 Orissa 194 have also taken the same view.

     The  above  decisions  appear  to   be  based  on  the principle  that a person in his capacity as a defendant  can raise  any  legitimate  plea available to him under  law  to defeat  the suit of the plaintiff.  This would also  include the  plea that the sale deed by which title to the  property was  intended  to  be  conveyed to  plaintiff  was  void  or fictitious  or, for that matter, collusive and not  intended to  be  acted upon.  Thus, the whole question  would  depend upon  the pleadings of the parties, the nature of the  suit, the  nature of the deed, the evidence led by the parties  in the suit and other attending circumstances.  For example, in a landlord- tenant matter where the landlord is possessed of many  properties  and cannot possibly seek eviction  of  his

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tenant  for  bona fide need from one of the properties,  the landlord  may ostensibly transfer that property to a  person who  is  not  possessed of any other property so  that  that person,  namely,  the  transferee,  may  institute  eviction proceedings on the ground of his genuine need and thus evict the  tenant  who could not have been otherwise evicted.   In this  situation, the deed by which the property was intended to  be transferred, would be a collusive deed representing a sham  transaction which was never intended to be acted upon. It  would be open to the tenant in his capacity as defendant to  assert, plead and prove that the deed was fictitious and collusive in nature.  We, therefore, cannot subscribe to the view expressed by the Privy Council in the case of Lal Achal Ram  (supra) in the broad terms in which it is expressed but do  approve  the  law laid down by the Calcutta,  Patna  and Orissa High Courts as pointed out above.

     In  the instant case, the property which was mortgaged in  favour  of defendant No.1 was transferred  by  defendant No.2, who was the owner of the property, to plaintiff.  This transfer  does  not,  in  any  way,  affect  the  rights  of defendant No.1 who was the mortgagee and the mortgage in his favour,  in  spite  of the transfer,  subsisted.   When  the present  suit  for  redemption was filed by  the  plaintiff, defendant  No.2, as pointed out above, admitted the claim of the  plaintiff  by filing a one-sentence  written  statement that  the  claim  of the plaintiff was admitted.   When  the plaintiff  entered into the witness box, defendant No.2  did not  cross examine him.  He did not put it to the  plaintiff that the entire amount of consideration had not been paid by him.   Defendant No.1 alone raised the question of  validity of the sale deed in favour of the plaintiff by pleading that it  was  a fictitious transaction as the sale  consideration had not been paid to defendant No.2 in its entirety.  Having pleaded  these facts and having raised the question relating to  the  validity  of the sale deed on the ground  that  the amount  of  consideration had not been paid, defendant  No.2 did not, in support of his case, enter into the witness box. Instead,  he  deputed his brother to appear as a witness  in the  case.  He did enter into the witness box but could  not prove  that  the  sale consideration had not  been  paid  to defendant  No.2.  On a consideration of the entire  evidence on  record,  the trial court recorded a positive finding  of fact  that  the  sale deed, executed by  defendant  No.2  in favour  of  the  plaintiff, was a genuine document  and  the entire  amount  of sale consideration had been  paid.   This finding  was  affirmed by the Lower Appellate Court but  the High  Court intervened and recorded a finding that  although the property which was mentioned to have been sold for a sum of  Rs.5,000/-,  the plaintiff had, in fact, paid  only  Rs. 500/- to defendant No.2.  The amount of Rs.4,500/- which was indicated  in  the sale deed to have been paid to  defendant No.2,  prior  to registration, was not correct.  It was  for this reason that the High Court while redeeming the property directed  that  the amount of sale consideration  which  was paid by the plaintiff to defendant No.2 shall be returned by defendant No.2 and the property would revert back to him.

     The  findings  of  fact concurrently recorded  by  the trial  court as also by the Lower Appellate Court could  not have been legally upset by the High Court in a second appeal under  Section  100  C.P.C.  unless it was  shown  that  the

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findings  were perverse, being based on no evidence or  that on  the evidence on record, no reasonable person could  have come to that conclusion.

     The  findings  of  fact concurrently recorded  by  the lower  Courts  on the question of title of the plaintiff  on the  basis of sale deed, executed in his favour by defendant No.2,  have been upset by the High Court on the ground  that full  amount  of consideration does not appear to have  been paid  by plaintiff to defendant No.2.  It will be worthwhile to reproduce the findings recorded by the High Court on this question.  The High Court observed:-

     "14.   As already stated above, the plaintiff had paid a  nominal  amount of Rs.500/- before the Sub-Registrar  and got  the  document  executed considering the plight  of  the defendant  No.2  that  his seven acres of land  was  already mortgaged  with  the  plaintiff  and, in  fact,  no  further consideration  of  Rs.4,500/-, as alleged, had been paid  to the  defendant  No.2.  This conclusion is supported  by  the conduct  of the defendant No.2, who had served the plaintiff with  a  notice alleging that the sale-deed executed in  his favour   was   a  sham  and   bogus  one  and  without   any consideration.   Even a complaint came to be made before the police   about  the  said   bogus  transaction,  which   was subsequently  withdrawn  in  view  of   the  fact  that  the defendant No.2’s lands to the extent of 7 acres were already mortgaged with the plaintiff.  All these would show that the plaintiff  was  pursuing the defendant No.2 to transfer  his property  in  his favour to the extent of 4 acres 4  gunthas and  under  pressure  the defendant No.2  admitted  to  have received  the  sum  of Rs.4,500/-.  As  stated  above,  this admission  was  made by the defendant No.2 in one  sentence. Therefore,  considering all these aspects, the learned lower appellate Court has held that no consideration has passed in favour of the defendant No.2 except the sum of Rs.500/- only alleged  to have been paid before the Sub- Registrar.  It is apparent  that  the  plaintiff   might  have  purchased  the property  only for Rs.2,000/- i.e.  Rs.1,500/- which were to be paid to the defendant No.1 for redemption of mortgage and Rs.500/-   paid   to   the   defendant   No.2   before   the Sub-Registrar.

     15.    Considering   all    the    above   facts   and circumstances,  I am of the view that the conclusion arrived at  by  the  learned  lower appellate  Court  directing  the defendant  No.1  to receive the amount of redemption and  to deliver the possession of the suit field to the plaintiff is not  correct.  It is pertinent to note that the  transaction between the defendant No.1 and 2 itself was a money- lending transaction  and  that  the sale-deed was a  mortgage  sale. Therefore, the defendant No.1 cannot become the owner of the property.   Even,  as held by the learned trial Court,  that nothing  has been placed on record by the defendant No.1  to support  his  contention that he had paid Rs.700/- at  home, and  the consideration of Rs.800/- had been paid before  the Sub-Registrar  to  defendant No.2, the learned  trial  Court observed that it is doubtful whether this amount of Rs.700/- has  also  been paid to the defendant No.2 by the  defendant No.1.   This  shows  that  the said mortgage  was  only  for Rs.800/-  and that the amount of Rs.700/- has not passed  to

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the  defendant  No.2 from defendant No.1.  It is clear  that except  Rs.500/-  nothing has been paid by the plaintiff  to defendant  No.2 as the amount of Rs.4,500/- alleged to  have been  paid  at  home  to the defendant  No.2  has  not  been established.   Therefore, the view taken by both the  Courts below under no circumstances, can be sustained."

     The  circumstances  relied upon by the High Court  had already  been considered by the Courts below and  ultimately the Lower Appellate Court proceeded to say as under:-

     "But  it  would  appear  as   though  that  all   this discussion  is wothless in view of the fact that deft.  No.2 himself admitted in his deposition that he executed the sale deed in favour of the plaintiff and accepted the price.  His written  statement and deposition is quite eloquent on  that point.   On the fact of these admission, there cannot be any other circumstance which would assist the Court to hold that the  document  executed  in  favour   of  the  plaintiff  by defendant  No.2  as bogus, sham and  without  consideration, notwithstanding  the  fact  that the circumstances  and  the facts of the case infallibly point that the document of sale does  not  convey the real transaction that had taken  place between plaintiff and defendant No.2.  As such although with reluctance,  it  has  to  be held  that  the  plaintiff  had purchased the property from defendant No.2."

     In  the  face  of the findings recorded by  the  trial court  as also by the Lower Appellate Court on the  question of execution of sale deed by defendant No.2 in favour of the plaintiff  with the further finding that it was a valid sale deed  which  properly conveyed the title of the property  in question  to the plaintiff, it was not expected of the  High Court  to set aside those findings merely on the ground that the  circumstances which had already been considered by  the lower Courts, appeared to suggest some other conclusion from proved facts.

     Let us scrutinise the circumstances relied upon by the High Court.

     In order to prove his case, the plaintiff had examined defendant  No.2  as a witness who admitted to have  executed the  sale  deed  in  favour of  the  plaintiff  and  further admitted  to  have  received  the   entire  amount  of  sale consideration.   The High Court has adversely commented upon the  production of defendant No.2 as a witness by saying  as under:-

     "Next  witness examined by the plaintiff was defendant No.2.   The plaintiff, while examining this witness, has not incorporated the name of this witness in the list of witness nor  any  application  was  made   for  the  examination  of defendant  No.2.  The willingness of the defendant No.2  was also  not  placed on record, to appear as a witness for  the

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plaintiff."

     This is wholly an erroneous view.

     Summoning  and  attendance  of   witnesses  has   been provided  for  in Order 16 of the Code of  Civil  Procedure. Order  16  Rule  1  which speaks of list  of  witnesses  and summons to witnesses provides as under:-

     "R.  1.  List of witnesses and summons to witnesses.

     (1)  On or before such date as the Court may  appoint, and  not later than fifteen days after the date on which the issues  are  settled, the parties shall present in  Court  a list  of witnesses whom they propose to call either to  give evidence  or to produce documents and obtain summons to such persons for their attendance in Court.

     (2)  A party desirous of obtaining any summons for the attendance  of any person shall file in Court an application stating  therein  the  purpose  for  which  the  witness  is proposed to be summoned.

     (3)  The Court may, for reasons to be recorded, permit a  party  to  call, whether by summoning  through  Court  or otherwise,  any witness, other than those whose names appear in the list referred to in sub-rule (1), if such party shows sufficient  cause  for the omission to mention the  name  of such witness in the said list.

     (4) Subject to the provisions of sub-rule (2), summons referred  to  in this rule may be obtained by parties on  an application  to  the  Court  or to such officer  as  may  be appointed by the Court in this behalf."

     Rule 1A which allows production of witnesses

     without summons provides as under:-

     "R.  1A.  Production of witnesses without summons.

     Subject  to the provisions of sub-rule (3) of Rule  1, any  party  to  the suit may, without applying  for  summons under  rule  (1), bring any witness to give evidence  or  to produce documents."

     These two Rules read together clearly indicate that it is  open to a party to summon the witnesses to the Court  or may,  without  applying for summons, bring the witnesses  to give evidence or to produce documents.  Sub-Rule (3) of Rule 1  provides that although the name of a witness may not find

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place  in  the  list of witnesses filed by a  party  in  the Court, it may allow the party to produce a witness though he may not have been summoned through the Court.  Rule 1A which was  introduced  by the Code of Civil Procedure  (Amendment) Act,  1976  with effect from 1.2.1977 has placed the  matter beyond  doubt by providing in clear and specific terms  that any party to the suit may bring any witness to give evidence or  to produce documents.  Since this Rule is subject to the provisions  of  Sub-Rule  (3)  of Rule 1, all  that  can  be contended  is that before proceeding to examine any  witness who might have been brought by a party for that purpose, the leave  of the Court may be necessary but this by itself will not  mean that Rule 1A was in derogation of Sub-Rule (3)  of Rule  1.  The whole position was explained by this Court  in Mange Ram vs.  Brij Mohan & Ors., AIR 1983 SC 925 = (1983) 4 SCC  36  =  1983  (3) SCR 525, in which  it  was  held  that Sub-Rule  (3) of Rule 1 and Rule 1A operate in two different areas and cater to two different situations.  It was held:-

     "There  is no inner contradiction between sub-rule (1) of  Rule 1 and Rule 1A of Order XVI.  Sub-rule (3) of Rule 1 of  Order  XVI confers a wider jurisdiction on the Court  to cater  to a situation where the party has failed to name the witness  in the list and yet the party is unable to  produce him  or her on his own under Rule 1A and in such a situation the  party  of necessity has to seek the assistance  of  the Court  under  sub-rule  (3) to procure the presence  of  the witness  and the Court may if it is satisfied that the party has sufficient cause for the omission to mention the name of such witness in the list filed under sub-rule (1) of Rule 1, the  Court may still extend its assistance for procuring the presence  of such a witness by issuing a summons through the Court  or  otherwise  which ordinarily the Court  would  not extend  for procuring the attendance of a witness whose name is not shown in the list.  Therefore, sub-rule (3) of Rule 1 and  Rule 1A operate in two different areas and cater to two different situations."

     In  view  of  the  above,  even  though  the  name  of Defendant  No.2  was not mentioned in the list of  witnesses furnished  by  the plaintiff, he was properly examined as  a witness  and his testimony was not open to any criticism  on the  ground that he was produced as a witness without  being summoned  through  the  Court  and without  his  name  being mentioned in the list of witnesses.

     The next circumstance relied upon by the High Court in discarding  the sale deed is that defendant No.2 himself had given a notice to the plaintiff in which it was set out that the  sale  deed  was  a   sham  transaction  for  which  the consideration   was   not  paid.   In  relying   upon   this circumstance,  the  High  Court  overlooked  the  fact  that defendant  No.2,  in  his  capacity as  a  witness  for  the plaintiff,  had  stated in clear terms that this notice  was issued  to the plaintiff at the instance of defendant  No.1. Defendant No.2 also stated that the complaint made by him to the  police  in  that  regard was withdrawn  by  him.   This circumstance,  therefore,  also could not have been  legally

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relied upon by the High Court in holding that full amount of consideration was not paid.

     It  could not be ignored that the plaintiff’s case had been  admitted in unequivocal terms by defendant No.2 in his written  statement.  It could also not be ignored that  when plaintiff  examined  himself  as  a  witness  in  the  suit, defendant   No.2   refused  to   cross-examine   him.    The circumstance,  which,  however, clinches the matter  is  the statement  of  defendant No.2 on oath in which  he  admitted that  he had executed a sale deed in favour of the plaintiff and  had  obtained full amount of consideration.   The  sale deed  is a registered document which recites that out of the amount of Rs.5,000/-, which was the sale price, a sum of Rs. 4,500/- had been paid earlier while Rs.500/- was paid before the  Sub-Registrar.   This recital read in the light of  the admission  made  by defendant No.2 in his written  statement and,  thereafter,  in  his  statment on oath  as  a  witness clearly  establishes  the  fact   that  defendant  No.2  had executed  a  sale  deed in favour of plaintiff for  a  price which was paid to defendant No.2.

     Even  if the findings recorded by the High Court  that the  plaintiff  had paid only Rs.500/- to defendant No.2  as sale  consideration  and the remaining amount of  Rs.4,500/- which  was  shown to have been paid before the execution  of the  deed  was, in fact, not paid, the sale deed would  not, for that reason, become invalid on account of the provisions contained  in  Section  54 of the Transfer of  Property  Act which provide as under:-

     "54.   "Sale"  is a transfer of ownership in  exchange for   a   price  paid  or   promised  or  part-   paid   and part-promised.

     Such  a  transfer, in the case of tangible  immoveable property  of the value of one hundred rupees and upwards, or in the case of a reversion or other intangible thing, can be made only by a registered instrument.

     In  the  case  of tangible immoveable property,  of  a value  less  than one hundred rupees, such transfer  may  be made either by a registered instrument or by delivery of the property.

     Delivery  of tangible immoveable property takes  place when  the  seller  places the buyer, or such  person  as  he directs;  in possession of the property.

     A  contract  for the sale of immoveable property is  a contract  that  a sale of such property shall take place  on terms settled between the parties.

     It  does  not,  of itself, create any interest  in  or charge on such property."

     The definition indicates that in order to constitute a sale,  there must be a transfer of ownership from one person to  another,  i.e., transfer of all rights and interests  in

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the  properties  which  are  possessed by  that  person  are transferred by him to another person.  The transferor cannot retain any part of his interest or right in that property or else  it  would not be a sale.  The definition further  says that  the transfer of ownership has to be for a "price  paid or  promised  or part-paid and part-promised".   Price  thus constitutes  an  essential ingredient of the transaction  of sale.   The  words "price paid or promised or part-paid  and part- promised" indicate that actual payment of whole of the price  at the time of the execution of sale deed is not sine qua non to the completion of the sale.  Even if the whole of the  price  is  not paid but the document  is  executed  and thereafter  registered,  if the property is of the value  of more than Rs.100/-, the sale would be complete.

     There  is a catena of decisions of various High Courts in  which  it  has been held that even if the whole  of  the price  is not paid, the transaction of sale will take effect and  the  title would pass under that transaction.  To  cite only  a few, in Gyatri Prasad vs.  Board of Revenue &  Ors., 1973 Allahabad Law Journal 412, it was held that non-payment of  a portion of the sale price would not effect validity of sale.  It was observed that part payment of consideration by vendee  itself  proved  the intention to pay  the  remaining amount of sale price.  To the same effect is the decision of the Madhya Pradesh High Court in Sukaloo & Anr.  vs.  Punau, AIR 1961 M.P.  176 = ILR (1960) M.P.  614.

     The  real  test is the intention of the  parties.   In order  to  constitute  a  "sale", the  parties  must  intend transfer  the  ownership of the property and they must  also intend  that the price would be paid either in presentii  or in future.  The intention is to be gathered from the recital in the sale deed, conduct of the parties and the evidence on record.

     Applying these principles to the instant case, it will be  seen that defendant No.2 executed a sale deed in  favour of  the  plaintiff, presented it for registration,  admitted its execution before the Sub-Registrar before whom remaining part of the sale consideration was paid and, thereafter, the document  was registered.  The additional circumstances  are that  when  the plaintiff instituted a suit on the basis  of his  title based on the aforesaid sale deed, defendant No.2, who  was the vendor, admitted in his written statement,  the whole  case set out by the plaintiff and further admitted in the  witness box that he had executed a sale deed in  favour of  the  plaintiff  and  had also received  full  amount  of consideration.   These  facts  clearly   establish  that   a complete  and formidable sale deed was executed by defendant No.2  in  favour  of  the plaintiff and  the  title  in  the property  passed to plaintiff.  The findings recorded by the High Court on this question cannot, therefore, be upheld.

     The  judgment of the High Court on this point is  also erroneous  for  the  reason  that  it  totally  ignored  the provisions  contained in Section 55(4)(b) of the Transfer of Property Act which are set out below:-

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     "55.  In the absence of a contract to the contrary the buyer  and  seller of immoveable property  respectively  are subject  to the liabilities, and have the rights,  mentioned in  the  rules  next  following,  or such  of  them  as  are applicable to the property sold:

     (1) .........................................

     (2) ........................................

     (3) ........................................

     (4) The seller is entitled-

     (a) ...................................  (b) Where the ownership  of  the property has passed to the  buyer  before payment of the whole of the purchase-money, to a charge upon the  property  in  the hands of the  buyer,  any  transferee without  consideration  or  any transferee  with  notice  of non-payment,  for  the amount of the purchase-money, or  any part  thereof  remaining  unpaid, and for interest  on  such amount  or  part from the date on which possession has  been delivered.

     (5) .........................................

     (6) ........................................."

     Clause  (b)  extracted above provides that  where  the ownership of the property is transferred to the buyer before payment  of  the  whole  of the sale price,  the  vendor  is entitled  to a charge on that property for the amount of the sale  price  as also for interest thereon from the  date  of delivery  of possession.  Originally, there was no provision with regard to the date from which interest would be payable on  the  amount  of  unpaid  purchase  money.   The  Special Committee  which suggested an amendment in this Section gave the following reason:-

     "This  Clause is also silent as to the date from which the  interest  on the unpaid purchase money should run.   It seems  fair that it should run from the date when the  buyer is put in possession."

     It  was on the recommendation of the Special Committee that  the words "from the date on which possession has  been delivered"  were inserted into this Clause by Section 17  of the Transfer of Property (Amendment) Act, 1929 (XX of 1929).

     This Clause obviously applies to a situation where the ownership in the property has passed to the buyer before the whole  of  the purchase money was paid to the seller or  the vendor.   What  is contained in this Clause is based on  the English  doctrine  of Equitable Lien as propounded by  Baron Rolfe  in Goode & Anr.  v.  Burton, (1847) 74 RR 633 = 1 Ex.

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189.   This  Clause  confers statutory  recognition  on  the English  Doctrine of Equitable Lien.  As pointed out by  the Privy  Council  in Webb & Anr.  vs.  Macpherson,  30  Indian Appeals  238,  the statutory charge under this paragraph  is inflexible.   The  charge  does not entitle  the  seller  to retain  possession of the property as against the buyer  but it  positively  gives him a right to enforce the  charge  by suit.  (See:  Venkataperumal Naidu vs.  Rathnasabhapathi

     Chettiar,  AIR  1953 Madras 821;   Shobhalal  Shyamlal Kurmi  vs.  Sidhelal Halkelal Bania, AIR 1939 Nagpur 210 and Basalingaya  Revanshiddappa  vs.  Chinnaya Karibasappa,  AIR 1932 Bombay 247).

     In  view  of the above, the High Court was  wholly  in error  in coming to the conclusion that there was no sale as only  a  sum  of  Rs.500/- was paid to  defendant  No.2  the balance  amount of Rs.4,500/- was not paid.  Since the title in  the  property  had already passed, even if  the  balance amount of sale price was not paid, the sale would not become invalid.   The property sold would stand transferred to  the buyer subject to the statutory charge for the unpaid part of the sale price.

     Learned   counsel   for   defendant  No.1   thereafter contended  that the deed dated 24th of March, 1971 was not a mortgage  deed but an out and out sale with the result  that the  property having been transferred to defendant No.1  was not  available for being sold to plaintiff.  This contention must meet the same fate as it met in the Courts below.

     The document is headed as MORTGAGE BY CONDITIONAL SALE (KARARKHAREDI).   It  is  mentioned in this  deed  that  the immovable   property  which  was   described  in  areas  and boundaries was being mortgaged by conditional sale in favour of  defendant  No.1  for  a sum of Rs.1500/-  out  of  which Rs.700/-  were paid at home while Rs.800/- were paid  before the  Sub-Registrar.  The further stipulation in the deed  is that  the aforesaid amount of Rs.1500/- would be returned to defendant  No.1  on  or  before 15th  March,  1973  and  the property  would be reconveyed to defendant No.2.  If it  was not  done  then  defendant  would become the  owner  of  the property.

     Mortgage  by conditional sale is defined under Section 58(c) as under:-

     "58.         (a)...................................... (b)......................................    (c)Where    the mortgagor ostensibly sells the mortgaged property -

     on  condition  that  on  default  of  payment  of  the mortgage-money  on  a  certain date the  sale  shall  become absolute,  or  on condition that on such payment being  made the  sale  shall become void, or on condition that  on  such payment  being made the buyer shall transfer the property to the  seller,  the  transaction  is   called  a  mortgage  by conditional sale and the mortgage a mortgagee by conditional sale:

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     Provided  that no such transaction shall be deemed  to be  a  mortgage,  unless the condition is  embodied  in  the document  which  effects  or purports to  effect  the  sale. (d)..................................... (e)..................................... (f)..................................... (g)....................................."

     The  Proviso to this Clause was added by Section 19 of the Transfer of Property (Amendment) Act, 1929 (XX of 1929). The  Proviso  was introduced in this Clause only to  set  at rest  the  controversy  about the nature  of  the  document; whether  the transaction would be a sale or a mortgage.   It has  been  specifically provided by the Amendment  that  the document  would  not  be treated as a  mortgage  unless  the condition of repurchase was contained in the same document.

     The basic principle is that the form of transaction is not the final test and the true test is the intention of the parties  in entering into the transaction.  If the intention of the parties was that the transfer was by way of security, it  would  be a mortgage.  The Privy Council as early as  in Balkishen  Das & Ors.  vs.  Legge, 27 Indian Appeals 58, had laid  down that, as between the parties to the document, the intention to treat the transaction as an out and out sale or as  a mortgage has to be found out on a consideration of the contents   of   document  in   the  light   of   surrounding circumstances.   The decision of this Court in Bhaskar Waman Joshi  vs.  Shrinarayan Rambilas Agarwal, AIR 1960 SC 301  = 1960  (2)  SCR 117 and C.I.T., Assam, Tripura & Manipur  vs. Nand  Lal  Agarwal, AIR 1966 SC 902 = 1966 (2) SCR  918  are also to the same effect.

     The  contents  of  the   document  have  already  been considered above which indicate that defendant No.2 executed a  mortgage by conditional sale in favour of defendant No.1. He had promised to pay back Rs.1500/- to him by a particular date  failing which the document was to be treated as a sale deed.   The  intention  of the parties is reflected  in  the contents of the document which is described as a mortgage by conditional sale.  In the body of the document, the mortgage money  has  also  been  specified.   Having  regard  to  the circumstances  of  this  case  as also  the  fact  that  the condition of repurchase is contained in the same document by which  the mortgage was created in favour of defendant No.1, the  deed in question cannot but be treated as a mortgage by conditional  sale.   This is also the finding of the  Courts below.

     So  far  as the contention of the learned counsel  for defendant  No.1 that the mortgage money was not paid  within the  time  stipulated  in the document and,  therefore,  the transaction,  even if it was a mortgage, became an  absolute sale,  is concerned, the finding of the Courts below is that this  money  was tendered to defendant No.1 who  refused  to accept  it.   Defendant No.2 had thus performed his part  of the  agreement and had offered the amount to defendant  No.1 so  that the property may be reconveyed to him but defendant No.1  refused  to accept the money.  He,  therefore,  cannot complain of any default in not paying the amount in question

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within  the time stipulated in the deed.  Since there was no default  on  the part of defendant No.2, the document  would not  convert  itself  into a sale deed and  would  remain  a mortgage  deed.   The  suit for redemption  was,  therefore, properly  filed  by  the plaintiff who was the  assignee  of defendant No.2.

     For  the  reasons stated above, the appeal is  allowed and  the  impugned judgment passed by the High Court is  set aside.  The judgment and decree passed by the trial court as upheld by the Lower Appellate Court are restored but without any order as to costs.