SMT. NEELAM JAIN & ANOTHER vs SMT. MADHU KAPOOR & OTHERS

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* IN THE HIGH COURT OF DELHI AT NEW DELHI
Pronounced on: 12.12.2023
+ CS (OS) 311/2018
SMT. NEELAM JAIN AND ANOTHER. ….. Plaintiffs
Through: Mr. Ankit Jain and Mr. Aditya Chauhan, Advs. for Pl. No.1.
Mr. Asheesh Jain, Mr. Gaurav Kumar and Ms. Ankita Kedia, Advs. for Pl. No.2.
versus
SMT. MADHU KAPOOR AND OTHERS …..Defendants
Through: Mr. Raj Shekhar Rao, Sr. Adv. along with Mr. Harish Kohli, Advs. for D-1 and 2.
Mr. Sahil Ralli, Adv. for D-3.
CORAM:
HON’BLE MR. JUSTICE SACHIN DATTA

JUDGMENT

IA 1789/2022 (under Order XII Rule 6 of CPC)
1. The present suit seeks the following reliefs: –
“(a) pass a decree in favour of the plaintiffs and against the defendants no. 1&2, for providing symbolic possession of half basement and the entire ground floor (in which Defendant No.3 is a tenant) and the physical and vacant possession of the remaining half of the basement and the entire first floor of the suit property in terms of sale deed dated 30.08.2017.
(b) Pass a decree in favour of the plaintiffs and against the defendant no. 1 to 3 directing them to pay to the plaintiffs the arrears of rents effective from 01.09.2017 (subsequent to the execution of sale deed dated 30.08.2017) to the present date of filing of suit along with 18% interest and such future rent.
(c) Pass a decree in favour of the plaintiffs and against the defendant no. 1 and 2 directing them to pay a sum of Rs. 12,55,740/- to the plaintiffs, being the security deposit collected by the defendants no. 1and 2 from defendant no.3 in terms of lease deed and which remain payable to defendant no.3 by the plaintiffs in the event of termination of lease deed.
(d) Pass a decree in favour of the plaintiffs and against the defendant no.3 directing them to attorn the lease rights of the hitherto owners to the plaintiffs or alternatively to execute a fresh lease deed.
(e) Pass a decree for permanent injunction in favour of the plaintiffs and against the defendants thereby permanently injuncting and restraining the defendants and their servants, representatives, agents etc. from alienating, selling, transferring, letting out or in any other manner creating third party rights or interests or charge or encumbrance in, and/or parting with possession of the suit property, to any other person except the plaintiffs;
(f) Pass any such further decree or order as this Hon’ble court may deem fit in the facts and circumstances of this case and in the interest of justice in favour of the plaintiffs and against the defendants;
(g) Award costs of the suit to the plaintiffs.”

2. The suit has been filed on the averment that an Agreement to Sell dated 02.08.2017 was executed between the plaintiffs and the defendant nos. 1 and 2 for selling the entire basement, ground floor and first floor, without roof rights of the property bearing No. AE-90, Shalimar Bagh, New Delhi-110088 built up on land measuring 247.50 sq. meters (hereinafter referred to as the “suit property”). The total consideration mentioned in the Agreement to Sell dated 02.08.2017 is stated to be Rs. 2.85 Crores. It is further averred that on 30.08.2017, a Sale Deed in respect of the suit property was executed by the defendant nos. 1 and 2 in favour of the plaintiffs after receiving the total sale consideration of Rs. 2.85 Crores. However, although it was mentioned in the Sale Deed dated 30.08.2017 that the possession of the suit property has been delivered to the plaintiffs at the spot, in actual fact, the possession of the suit property was only symbolically delivered to the plaintiffs. The entire ground floor and half portion of the basement of the suit property continues to remain in possession of the Bank of India (defendant no.3) as tenant, whereas physical possession of the other half portion of the basement and the entire first floor continues to remain in possession of defendant nos. 1 and 2.
3. An Agreement to Sell dated 30.08.2017 is also stated to have been executed between the plaintiffs and the defendant nos. 1 and 2 in respect of the entire second floor, third floor and roof rights in the same property bearing no. No. AE-90, Shalimar Bagh, New Delhi-110088 built up on land measuring 247.50 sq. meters. However, no relief qua the said Agreement to Sell dated 30.08.2017 has been claimed in the present suit and the same is stated to be the subject matter of CS (OS) 258/2018.
4. The present application has been filed on the averment that the factum of the execution of the Sale Deed dated 30.08.2017 in respect of the suit property is admitted by the defendant nos. 1 and 2 in their written statement. It is submitted that as such, there is no impediment in decreeing the present suit as far as the relief of possession [Prayer (a) in the suit] is concerned and relief of permanent injunction [Prayer (e) in the suit] is concerned. It is further averred in the present application, that while admitting the factum of the execution of the Sale Deed dated 30.08.2017, the defendant nos. 1 and 2 have set up a case that the Sale Deed was executed as a “collateral security”, which is required to be rejected outright in view of the bar contained in Sections 91 and 92 of the Indian Evidence Act, 1872.
5. It has also been brought out in the present application that the defendant nos. 1 and 2 had filed a separate suit i.e., CS (OS) 26/2020 inter alia seeking cancellation of the Sale Deed dated 30.08.2017 executed by the said defendants in favour of the plaintiffs. It is further averred that the said suit is premised on the same basis on which the defendant nos. 1 and 2 seek to resist the present suit. Strong reliance has been placed upon the judgment dated 16.12.2021 passed in the said CS (OS) 26/2020, whereby, the application under Order VII Rule 11 of CPC, 1908 of the defendants therein (plaintiffs in the present suit), has been allowed. As such, the challenge to the validity of the Sale Deed dated 30.08.2017 is stated to have been comprehensively rejected by the Co-ordinate Bench of this Court vide said judgment dated 16.12.2021 passed in CS(OS) 26/2020.
Submissions of counsel
6. During the course of arguments, learned counsel for the plaintiffs/applicants has contended as under:
(i) That the factum of the execution of the Sale Deed dated 30.08.2017 having been admitted by the defendants, and challenge to the validity of the said Sale Deed in the suit filed by the defendant nos. 1 and 2 having been comprehensively rejected by this Court, there is no impediment to the present application being allowed insofar as prayers (a) and (e) of the present suit are concerned.
(ii) Reliance is placed on the judgment of a Co-ordinate Bench of this Court in Karan Madaan and Others vs. Nageshwar Pandey1 wherein this Court had considered a similar defence of a vendor viz. that the Sale Deed in question was executed for a “collateral purpose/transaction to create a security for repayment of loan”.
(iii) It has further been submitted that even if it is assumed that the full/balance price is yet to be paid to the defendant nos. 1 and 2 in respect of the transaction between the parties, even then, having regard to the provisions of Section 55(4)(b) of the Transfer of Property Act, 1882, the remedy of defendant nos. 1 and 2 is only to sue for the balance price and the same would not impinge upon the validity of the Sale Deed.
7. In this regard, reliance has been placed on the following judgments:
(i) Kaliaperumal vs. Rajgopal & Ors. (2009) 4 SCC 193 (Para 16 – 19)
(ii) Vidhyadhar vs. Manikrao &Ors. (1999) 3 SCC 573 (Para 34-41,43 & 44)
(iii) Shiv Kumar Sharma vs. Madhu Aggarwal 2011 (126) DRJ 286 (Para 2, 3, 5, 7 to 9)
8. Per contra, learned counsel for the defendant nos. 1 and 2 has submitted that vide an Agreement to Sell dated 26.06.2017 executed between the parties, the entire property bearing No. AE-90, Shalimar Bagh, New Delhi-110088 built up on land measuring 247.50 sq. meters comprising of all floors i.e., basement, ground floor, first floor, second floor, third floor and roof rights was agreed to be sold for a sale consideration of Rs. 16.85 Crores. It is submitted that the plaintiffs had even applied for a loan with Bank of India on the basis of the said agreement to sell. It is submitted that the present plaintiffs failed to make the payment of the total sale consideration as contemplated under the Agreement to Sell dated 26.06.2017 i.e., of Rs.16.85 Crores. It is further submitted that during the course of dealing/discussions between the parties, the plaintiffs agreed to pay a partial amount in lieu of which the defendant nos. 1 and 2 agreed to execute the Sale Deed dated 30.08.2017 with respect to the basement, ground floor and first floor without roof rights of the suit property, with the specific condition that the said sale deed shall be deemed as “collateral security” towards the partial payment being made by the plaintiffs to the defendant nos. 1 and 2.
9. It is submitted that despite the execution of the Sale Deed dated 30.08.2017, no physical possession of any part of the property was handed over to the plaintiffs, owing to an understanding between the parties that the plaintiff shall not claim any part of the property till making the balance payment of the total sale consideration as contemplated in the Agreement to Sell dated 26.06.2017. It is further submitted that on 29.08.2017, an amended agreement to sell was entered into between the parties, purportedly for extension of time in respect of payment of balance amount of the total sale consideration towards the entire property as per the Agreement to Sell dated 26.06.2017. It is submitted that the execution of the Sale Deed dated 30.08.2017 in respect of basement, ground floor and first floor of the property was as such a product of fraud and misrepresentation and therefore the said sale deed is completely vitiated. In this regard, reliance has been placed on the judgment of Supreme Court in Hardesh Ores (P) Ltd. v. Hede & Co.2
10. It is further submitted that the defendant Nos. 1 and 2 have already filed an RFA against the judgment dated 16.12.2021 in CS(OS) no. 26/2020 and therefore, one of the primary basis on which the present application has been filed by the plaintiffs is under challenge.
Analysis and Conclusion
11. Having perused the record and considered the averments made by the respective counsel, I find merit in the contentions made on behalf of the plaintiffs/applicants. It is a fact that the execution of the Sale Deed dated 30.08.2017 has not been denied in the written statement filed on behalf of defendant nos. 1 and 2. In this regard, reference can be made to the relevant portion of the said written statement, which is reproduced as under :
“3.
….
k. That after continuous pursuance and assurances of Mr. Subash Lamba, the Defendants finally agreed to execute the sale deed for Basement, Ground Floor and First Floor with the specific condition that sale-deed shall be deemed as ‘Collateral Security’ towards the payment being made by the plaintiffs to the defendants. However, despite the execution of the sale-deed, neither actual physical possession of any part of the property shall be handed over to the Plaintiffs nor the Plaintiffs shall claim any benefits that arise from any part of the said entire property, till the making of balance of full and final payment of the entire property as per the agreement to sell vide dated 26.06.2017 by the Plaintiffs.
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m. That the defendants came in the smooth and sweet talks of the Plaintiffs and fraudulent assurances of Mr. Subash Lamba, therefore extended the time for making full & final payment of balance amount on or before dated05.11.2017 and had also executed the sale deed as ‘Collateral Security’ in respect of Basement, Ground & First Floor of the above said property however without handover the actual physical possession to the Plaintiffs with the plaintiffs promise and assurance that they shall neither create any third party interest nor they claim any rights arising out of the said property till the making of full & final payment to the Defendants within the stipulated time as agreed in the amended agreement to sell dated 29.08.2017.

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16. That the plaintiffs have approached to this Hon’ble Court on basis of false, forged, frivolous & fictitious submissions &documents and they are trying to misguide the Hon’ble Court for their ulterior motives. The plaintiffs along with Mr. Subash Lamba, had somehow managed to impress the defendants to execute the sale-deed in respect of Basement, Ground Floor and First Floor of the property in question as they are well aware about the building structure is such kind that no other buyer would even show their interest to purchase the remaining portion. That is why the plaintiffs have forged the signature of the defendants as well as prepared false & fabricated documents on which they are relied on, in connivance of Mr. Subhash Lamba, and now through filing the present suit, they are trying to twist the hands of the defendants in their favour so that they can bend the defendants to sale their remaining portion to them on their dictum. Hence, the present suit is requires no consideration of this Hon’ble Court, thus requires dismissal. The site plan of the property in question is annexed.”

12. It is also a fact that the challenge made by the defendant nos.1 and 2 to the validity of the said Sale Deed dated 30.08.2017 in CS(OS) no. 26/2020 stands comprehensively rejected by a Co-ordinate Bench of this Court. In this regard, reference is apposite to the observations made in the judgment dated 16.12.2021 passed in CS(OS) No. 26/2020 whereby the plaint filed by the defendant nos. 1 and 2 challenging the Sale Deed dated 30.08.2017 was rejected by this Court. It is noticed that the factual narration in the said civil suit by the defendant nos. 1 and 2 [plaintiffs in that case] is completely identical to the narration made in the written statement filed by the said defendant nos. 1 and 2 in the present suit. The said judgment dated 16.12.2021 records the averments of the defendant nos. 1 and 2 (plaintiffs in CS(OS) 26/2020) as under :-
“2.1 Plaintiffs propounded that they are joint owners of the suit property. Defendant No. 1 & 2 had approached them through property dealers viz. Defendant No. 3 and Mr. Mukul Lamba along with Mr. Bhupinder Jain and Mr. Sanjay Jain, for purchase of the entire built-up suit property. After negotiations, Plaintiffs entered into an Agreement to Sell dated 26thJune, 2017 [hereinafter “ATS 1”] with Defendants No. 1 & 2 to sell the entire built-up property (basement to top with terrace and free-hold rights) situated at AE-90, Shalimar Bagh, New Delhi- 110088 for a total sale consideration of Rs. 16,85,00,000/-. This Agreement includes the suit property, described above.
2.2 Defendants No.1 & 2 approached the Plaintiffs through Defendant No.3 and expressed their inability in making full and final payment of the sale consideration within the stipulated time period under ATS 1 and sought extension of time for making such payment. After assurances given by Defendant No.3 and several requests made by Defendants No.1 and 2, Plaintiffs agreed to execute a sale deed qua the suit property with the pre-condition that sale deed shall be deemed as a ‘collateral security’ towards the full and final payment being made by the Defendants No. 1 and 2 to the plaintiffs. Neither actual physical possession of any part of the suit property was agreed to be handed over to the Defendants No.1 and 2 nor were they entitled to claim any benefits arising from any part of the said suit property, till the making the full and final balance payment qua the entire suit property (basement to top with terrace and free-hold rights), as per ATS 1.
2.3 An Agreement to Sell dated 29thAugust, 2017 [hereinafter “ATS 2”] was entered into between the Plaintiffs and Defendants No.1 and 2. The same was entered into for extension of time for payment of balance amount qua the total sale consideration due towards the entire property under ATS 1 and also to execute sale deed as ‘collateral security’. Under ATS 2, the Plaintiffs had reserved their right of receiving rent from Defendant No.5 viz. Bank of India, that is a tenant of the Plaintiffs, till the maturity of ATS 1 and ATS 2.
2.4. Thereafter, a Sale Deed dated 30thAugust, 2017 was executed by the Plaintiffs with respect to basement, ground floor and first floor (suit property). The said Sale Deed is duly registered with the Sub Registered VI A, Pitampura, Delhi [Registration No. 1654 in Addl. Book No.1, Volume No. 7076 on pages 116 to 129 in the office of Sub Registrar VI A, Pitampura, Delhi].
2.5 The said Sale Deed was executed as Plaintiffs were persuaded by Defendants No. 1 and 2 with ‘sweet and smooth talks’ and on ‘fraudulent assurances’. It premised on an understanding between the parties that the same shall be deemed to be a ‘collateral security’ until full and final payment and was executed on assurances given by Defendants No. 1, 2 and 3 that neither third-party interest(s) shall be created, nor would any rights be claimed till making the full and final payment to the Plaintiffs within the stipulated time i.e., 05 th November, 2017, as agreed in ATS 2.
2.6 Plaintiffs issued a legal notice dated 25th October, 2017 to the Defendants No. 1, 2 and 3 thereby calling upon Defendants No. 1 and 2 to make the balance payment of Rs. 13,34,75,000/-, upon which the Plaintiffs shall execute a sale deed for the remaining portions viz. second floor and third floor of the property in question, in favour of the Defendants No. 1 and 2, as provided under ATS 1 and ATS 2.
2.7 In response thereto, Defendants No. 1 and 2 along with Defendant No. 3 vide reply dated 08th November, 2017 denied the averments made in the legal notice and reference was drawn to an alleged Agreement to Sell dated 30th August, 2017 (hereinafter “ATS 3”]. This Agreement pertains to second floor and third floor of the property in question and is a forged and thus, null and void.
2.8 Defendants No. 1 and 2 in collusion with Defendant No. 3 have forged the Sale Deed dated 30th August, 2017 which was executed in favour of Defendants No. 1 and 2 by the Plaintiffs as the same does not contain the clause of ‘collateral security’ as well as the clause which says that the possession of basement, ground floor and first floor shall be handed-over to Defendants No. 1 and 2 only after receiving the full and final payment as per ATS 1 and ATS 2, which were originally presented to the Plaintiffs before signing the Sale Deed. Thus, the Sale Deed dated 30th August, 2017 is forged one and fraudulently prepared by the Defendants No. 1 and 2 in connivance of Defendant No. 3 for their illegal and ulterior motives to blackmail the Plaintiffs and they were in collusion to grab the entire property.
2.9 Defendants No. 1 and 2. in connivance with Defendants No. 3 committed fraud, misrepresented and cheated the Plaintiffs and violated the terms of ATS 1 and ATS 2 and filed suits titled as (a) Neelam Jain &Anr. v. Madhu Kapoor &Ors. in CS (OS) 311/2018 (seeking vacant physical possession qua half of the basement and first floor of property), and (b) Neelam Jain & Anr. v. Madhu Kapoor &Anr. in CS (OS) 258/2018 (seeking specific performance of ATS 3 in relation to second floor and third floor of the property).
2.10 Plaintiff’s consent was obtained by Defendants No. 1, 2 and 3 by fraud, undue influence, illegally to defraud the Plaintiffs with common intention to cheat, extort and threaten the Plaintiffs to grab their entire property illegally. Plaintiffs have registered their complaints against Defendants No. 1, 2 and 3 before PS. Shalimar Bagh, Delhi Police on 29th September, 2018.”

13. The said judgment after taking note of the terms of the Sale Deed dated 30.08.2017, inter alia, holds as under:-
“9. The above-mentioned Sale Deed here is a concluded contract, it absolutely conveys the suit property mentioned therein and belies the cause of action set up in the plaint. Clause 2 and 12, among other clauses of the Sale Deed reproduced above explicitly records that the suit property has been sold, transferred, and conveyed completely. Where the law compels a document to be in writing, that alone will be determinative of the intention of the parties. Instruments/ contracts reduced in writing presume deliberation on the part of the contracting parties and are certainly to be treated with careful consideration by the courts. The oral understanding pleaded to explain the circumstances under which the Sale Deed was executed is thus, in utter variance and completely contradictory to terms recorded in the Sale Deed.
10. Plaintiffs have narrated the circumstances leading to the execution of the Sale Deed and have also used the expression of ‘fraud’, ‘misrepresentation’ and ‘cheating’. This forms the basis for reliance on the exceptions to Section 91 and 92 of the Evidence Act to overcome the hurdle in law to maintain the suit. In the opinion of the Court, such pleas are untenable and barred under Section 91 and 92 of the Evidence Act in the face of the registered instrument of sale, admittedly executed by the Plaintiffs in favour of Defendants No. 1 and 2. The spirit and objective of Section 91 and 92 of the Evidence Act is to render the written contracts/ agreements and other dispositions as the sole repository of the terms and conditions contained therein. The registered Sale Deed proves the terms embodied therein and thus, Section 92 of the Evidence Act comes into operation for the purpose of excluding evidence of any oral agreement(s)/ statement(s) intended to contradict, vary, amend, add, or subtract from its terms. Section 92 of the Evidence Act, inter-alia, stipulates that where the terms of an instrument or other disposition of property have been proved as per Section 91 of the Evidence Act and in case the execution and registration of the instrument of sale is not disputed, no evidence of any purported oral agreement(s)/ statement(s) shall be admitted, as between the parties to such instrument, for the purpose of varying, contradicting, adding to, or subtracting from its terms. In V. Anantha Raju and Another v. T.M. Narasimhan and Others, the Apex Court, inter-alia, held as under:
“It has been held that it would be inconvenient that matters in writing made by advice and on consideration, and which finally import the certain truth of the agreement of parties should be controlled by averment of the parties to be proved by the uncertain testimony of slippery memory. It has been held that when parties deliberately put their agreement into writing, it is conclusively presumed, between themselves and their privies, that they intended the writing to form a full and final statement of their intentions, and one which should be placed beyond the reach of future controversy, bad faith and treacherous memory.”
11. Plaintiffs have relied upon the judgment of the Supreme Court in Gangabai v. Chhabubar to contend that it is permissible for a party to a deed to argue that the deed was never intended to be acted upon and was a sham instrument, and it would thus, be necessary to lead oral evidence to establish that the document executed was never intended to operate/ act as a binding agreement and instead, some other document(s) would be binding between the parties. No doubt Section 92 of the Evidence Act provides certain exceptions, which permit oral evidence, however, Plaintiffs’ case does not fall under any of the exceptions carved out for oral evidence. The execution of the Sale Deed is admitted in the plaint. The intention of the parties is to be gathered from the aforesaid recitals of the Sale Deed, the conduct of the parties, and the evidence on record. Under Clause 1 of the Sale Deed, Plaintiffs accepted the payment, as mentioned therein as full consideration, and conveyed all rights in favour of Defendants No. 1 and 2. The details of the cheques, the amounts mentioned, etc. are clearly disclosed. The receipt of some of the cheques are also admitted in paragraph Nos. 3, 10 and 18 of the plaint. The amount mentioned in the Sale Deed is stated to be the ‘entire sale consideration’. There is no clause shown to the Court which makes payment of any amount, over-and-above the said amount, a condition precedent for transfer of title. All these facts clearly demonstrate that the intention of the Plaintiffs was clearly to convey all the rights, title and interest in the portions of the suit property which were the subject matter of the registered Sale Deed dated 30thAugust, 2017 in favour of Defendants No. 1 and 2. It is inconceivable that if the Plaintiffs did not receive the entire alleged sale amount, they would execute the said Sale Deed.
12. Further, Plaintiffs have not relied on any documents or evidence to prove their case, except for relying upon two documents viz. ATS 1 and ATS 2. The said purported documents are only agreement to sell’, which have been entered into prior to the execution of the registered Sale Deed. The transaction between the parties, considering the value of the immovable property, could only be by way of a registered instrument under the provisions of the Transfer of Property Act, 1882 [hereinafter “Transfer of Property Act”] which supersedes any prior understanding between the parties, as recorded therein. The intention of the parties has to thus, be gathered from the final document of sale i.e., the Sale Deed which is admitted by the Plaintiffs to be registered in the office of the concerned Sub- Registrar.
13. In the present case, the Plaintiffs argue that the said registered instrument was executed only as a ‘collateral security’ against the payment of the consideration qua the remaining portion of the property and Defendants No. 1 and 2 have committed fraud, misrepresented, and cheated by seeking to exploit the instrument of sale, contrary to the understanding between the parties viz. the Sale Deed that was only to be in nature of a ‘collateral security’. It is well-settled in law that a mere mention of “fraud” or “misrepresentation” in a pleading is insufficient. There are bald assertions to give a semblance of cause of action. A party pleading “fraud” is obliged, under Order VI Rule 4 of CPC, to provide particulars of the pleaded “fraud” accompanied with dates and items, in its pleadings. The plaint does not make out a case of “fraud”. In any event, the fraud, intimidation, illegality, etc. referred to in first proviso to Section 92 of Evidence Act relates to the execution of the instrument/ document. It is not the Plaintiffs’ case that on execution of the registered instrument/ Sale Deed, they were unaware that it is a ‘sale deed’ that they were executing. It is also not their case that they are illiterate; or that they had not read; or could not read the instrument in question. It is also not claimed that the Sale Deed was executed in an intoxicated and/or unsound state; or under duress or coercion exercised by the Defendants and/ or anyone else. In fact, the Sale Deed makes a specific statement to the contrary. Plaintiffs knew the fact that they were executing an instrument of sale. At this juncture, when Plaintiffs executed the Sale Deed in question, it is not open for them to claim that the instrument of sale is hit by “fraud”, “misrepresentation” or “cheating”, because, according to them the intention or understanding between the parties was to create a ‘collateral security’. The Plaintiffs are seeking to foist an obligation on Defendants No. 1 and 2 that is contrary the terms of the registered instrument viz. Sale Deed. If the intention of the parties was, as is claimed by the Plaintiffs, then that intention should have been expressed in the instrument itself. However, that is not the case. Thus, the entire cause of action pleaded is in the teeth of Section 91 and 92 of the Evidence Act.
14. The plaint also entirely lacks preciseness/ specificity which renders the pleadings vague. There is also no material or document to support any circumstance pointing to the Sale Deed that is purported to be in nature of a ‘collateral security’. Even otherwise in case the parties wanted to execute a document in nature of a ‘collateral security’, it would be a more cost effective and easier course for them to execute an instrument in the nature of a mortgage, etc. instead of executing a sale deed vesting absolute rights in favour of Defendants No. 1 and 2 and also incurring higher stamp duty and other charges thereon. It is thus, a classic case where the Plaintiffs have by way of clever drafting, attempted to create an illusory cause of action.

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18. In view of the foregoing, this Court is unpersuaded by the Plaintiffs’ arguments mentioned above including the contention that the trial should proceed in the instant matter. Thus, on a meaningful reading of the plaint, the Court finds the suit to be vexatious, meritless, and does not disclose a clear right to sue and it is a complete abuse of process of court that should be nipped in the bud. The plaint is liable to be rejected under Order VII Rule 11 of CPC.
19. In view of the foregoing, the application stands allowed in the above terms and accordingly, the plaint is rejected under Order VII Rule 11 of CPC and the pending applications are dismissed.”

14. In view of the findings rendered in the aforesaid judgment dated 16.12.2021, the challenge to the validity of the Sale Deed dated 30.08.2017, or the plea that the same was issued for any “collateral purpose”, stand foreclosed.
15. In Karan Madaan and Others vs. Nageshwar Pandey3, a Co-ordinate Bench of this Court, while dealing with a similar plea sought by the defendants therein, seeking to refute/deny the validity of a duly executed Sale Deed on the ground that the Sale Deed was executed to secure a loan taken from the plaintiff by the defendant, took note of Sections 91 and 92 of the Indian Evidence Act, 1872 and inter alia held as under :-
“22. Section 91, inter alia, stipulates that where the terms of a contract or of a grant or any other disposition of property have been reduced to a form of written document-as in the present case the sale deed dated 01.11.2011 has been registered on 02.12.2011, no evidence shall be given in proof of the terms of such a contract, grant or other disposition of property, except the document itself. Therefore, if there is a sale deed executed and registered in respect of an immovable property-registration whereof is compulsory under the law, neither party can claim that the terms of the sale-such as the consideration, or the nature of transaction/disposition is, in fact, different from that contained in the document itself.
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24. Therefore, the terms of the sale deed clearly show that the nature of the transaction that the said instrument records is an absolute conveyance of property i.e. the sale of the suit property. By no stretch of reasoning it can be described as a transaction of loan, coupled with a transaction to create a security for repayment of loan with interest and costs and subsequent retransfer of the suit property by the plaintiffs to the defendant.

25. The terms on which the suit property was conveyed by the defendant to the plaintiffs having been set out in the sale deed itself, in view of the bar contained in Section 91, it is not open to the defendant to claim that the conveyance was made only by way of security. The terms of the instrument of sale completely rule out the so-called understanding between the parties, that the suit property was to remain a security for the repayment of the so-called loan, and was to be re-conveyed to the defendant upon repayment of the so-called loan of Rs. 1.65 Crores with interest and other charges. In fact, the sale deed contains terms authorizing the plaintiffs/vendees to get the suit property mutated in their own names in the records of MCD/DJB/DVB/NDPL/BSES/concerned departments etc. (clause 5). It also places obligation on the plaintiffs to bear the house tax, electricity and water bill charges after the date of execution/registration of the sale deed. The aforesaid clauses militate against the defence/counter- claim set up by the defendants, which only go to show that the said defence is patently frivolous and moonshine. If the sale deed in respect of the suit property were executed only as a security-to secure the repayment of the loan, interest and other charges by the defendant to the plaintiffs, there would be no question of mutation of the property in the names of the plaintiffs, and the thrusting of the liability towards payment of house tax, electricity and water charges upon the plaintiffs from the date of execution of the sale deed. If the suit property were to be offered as a security for repayment of the so called loan, interest and other charges, a mortgage in respect of the suit property could have been created by the defendant in favour of the plaintiffs, rather than executing a sale deed for absolute and outright sale of the suit property which would entail higher stamp duty and other charges as well. Pertinently, even the stamp duty has been borne by the vendees/plaintiffs, which would not have been the case, had it been a simple loan transaction with security of immovable property.

26. Explanations 1 and 2 of Section 91 have no relevance for the present case. Explanation 3 only states that the statement of a fact in a document, “other than the facts referred to in this Section” may be proved by leading oral evidence. The “fact referred to in this Section” are the “terms of a contract, or a grant, or of any other disposition of property” which have been reduced to the form of the document. For instance, if the age or address, or paternity of a party is recorded in an instrument, it shall be open to the parties to lead evidence to establish that the same is not correctly recorded, or that the same is, in fact, different from what the instrument records. However, this explanation cannot be invoked to disprove the “terms of a contract, or of a grant, or of any other disposition of property”.

27. Section 92 of the Evidence Act, inter alia, provides that where the terms of a grant or other disposition of property have been proved according to Section 91-and in this case the execution and registration of the instrument of sale is not disputed by the defendant, no evidence of any oral agreement, or statement shall be admitted, as between the parties to such instrument, for the purpose of contracting, varying, adding to or subtracting from its terms.”

16. As regards the plea of fraud, the said judgment, interalia, held as under:
“31. The defence/case set up by learned counsel for the defendant in his arguments is of fraud, on the premise, that the plaintiffs are seeking to exploit the instrument of sale, contrary to the understanding of the parties that the sale deed was only to be used as a security for repayment of loan, interest and other charges. Pertinently, the written statement or the counter claim do not whisper about a “fraud”, though the defendant repeatedly states that the plaintiffs are greedy, have turned dishonest, and are of a criminal mind. A mere mention of “fraud” in a pleading is not sufficient. A party pleading fraud is obliged, under Order VI Rule 4 CPC, to give particulars of the pleaded fraud-with dates and items, in the pleading. The pleadings of the defendant, in the written statement/counter claim do not even make out a case of fraud. In any event, the fraud, intimidation, illegality, etc referred to in proviso 1 to Section 92 relates to the execution of the instrument/document. It is not the defendant’s case that when he executed the sale deed, he did not know that it is a sale deed that he was executing. It is not the defendant’s case that he is unlettered or illiterate or that he did not read, or could not read the instrument in question. He does not claim that the sale deed was executed in an intoxicated or unsound state, or under duress or coercion exercised by the plaintiffs, or anyone else. The defendant knew the fact that he was executing an instrument of sale. When he has executed the sale deed in question, it is not open to the defendant to claim that the instrument of sale is hit by fraud, because, according to the defendant, the intention or understanding of the parties was to create a security in favour of the plaintiffs for the alleged loan granted to the defendant. The spirit and purpose of enacting Section 91 and 92 of the Indian Evidence Act, 1872 is to render the written contract, grant or other disposition the sole repository of the terms contained therein. If the intention of the parties was, as is claimed by the defendant, then that intention/objective/purpose should have been so spelled out in the instrument. Unfortunately for the defendant, that is not the case.

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52. The defendant is barred in law by virtue of Section 91 and 92 from claiming that the amounts received by him were towards loan and not towards sale consideration as already noticed above. …….

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70. There is no purpose of dragging the matter further into trial so far as the relief of possession is concerned, since the title of the plaintiffs in respect of the suit property stands established, and the only consequence thereof, in law, can be that the suit of the plaintiff for possession has to succeed.”

17. The aforesaid judgement was affirmed by a Division Bench of this Court in Nageshwar Pandey vs. Karan Madaan & Ors4.
18. The observations and the statement of law enunciated in the aforesaid judgment in Karan Madaan (supra) squarely apply to the present case as well. The defendant nos. 1 and 2 cannot be permitted to put up a case which is completely at variance with the recitals and the covenants contained in the Sale Deed dated 30.08.2017. In terms of the said sale deed, title in respect of the suit property stands validly conveyed to the plaintiffs.
19. In the above circumstances, the present application is liable to be allowed. Accordingly, a decree is passed in favour of the plaintiffs and against the defendant nos.1 and 2 for providing symbolic possession of half of the basement and the entire ground floor (in which defendant no.3 is a tenant) and the physical and vacant possession of the remaining portion of the suit property as contemplated in the Sale Deed dated. 30.08.2017. Further, a decree for permanent injunction is passed in favour of the plaintiffs and against the defendants, thereby permanently injuncting and restraining the defendants and their servants, representatives, agents etc. from alienating, selling, transferring, letting out or in any other manner creating third party rights or interests or charge or encumbrance in favour of any person other than the plaintiffs and/or parting with possession of the suit property.
20. The other reliefs sought by the plaintiffs (which concerns defendant no.3) shall be considered independently.
21. The present application stands disposed of in the above terms.

SACHIN DATTA, J
DECEMBER 12, 2023
AT/dk

12014 SCC OnLine Del 1277
2(2007) 5 SCC 614
32014SCC OnLine Del 1277
4 2016 SCC OnLine Del 816
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I.A. 1789/2022 in CS (OS) 311/2018 Page 17 of 17