2018 (10) TMI 1879 - HC - Indian Laws

Mutation of Exchange - validity of registered sale deed - possession of suit land - cause of action to file the present suit - maintainability of suit of the plaintiffs in the present form - locus standi to file the present suit - estoppel by their act and conduct to file the present suit or not - suit of the plaintiffs is bad for mis-joinder of necessary parties or not - jurisdiction to try the present suit. Whether oral exchange of immovable property worth more than ₹ 100/- is permissible? - HELD THAT - The issue in question, in fact, is no longer res integra in view of the authoritative pronouncement of the Hon'ble Supreme Court as have been taken into consideration by a Co-ordinate Bench of this Court (Sandeep Sharma, J.) in a fairly recent decision in PIAR CHAND AND ORS. VERSUS SANT RAM AND ORS. 2017 (5) TMI 1753 - HIMACHAL PRADESH HIGH COURT wherein it was observed that this Court is of definite view that no reliance, if any, could be placed by first appellate Court on 'Azadinama' Ex. P-1 to conclude that plaintiff had relinquished his 1/2 share in favour of the defendants, more particularly, in the absence of registered relinquishment deed, if any, executed by the plaintiff. Since there was no registered relinquishment deed, mutation attested in favour of defendants, on the basis of Ex. P-1 is/was of no consequence and same could not be taken into consideration by the Court below while holding the defendant to be owners to the extent of 1/2 share in the suit land. Learned counsel for the respondents has failed to show any other authority taking a contrary view one taken by the learned Single Judge in the aforesaid cases and the reason for the same is otherwise obvious. Accordingly, taking the support from the aforesaid judgment by holding that the oral exchange of more than ₹ 100/- is impermissible in law. Whether the alleged exchange could have been transacted and effected on behalf of the appellants/plaintiffs by their father and that too when the father appears to have not been appointed as attorney of the appellants/plaintiffs? - HELD THAT - It is settled that mutation entries are only to enable the State to collect revenues from the persons in possession and enjoyment of the property and the right, title and interest as to the property should be established dehors the entries. Entries are only one of the modes of proof of the enjoyment of the property. Mutation entries do not create any title or interest therein - issue answered in favour of the appellants. Could the first appellate court have reversed the decree of the learned trial Court based on the reasoning that there was variance between the plea taken in the written statement and the testimony of defendant No. 3 as to the mode of exchange viz. In the written statement it was alleged that there was an oral exchange and in the testimony it was stated that a deed of exchange had been executed? - HELD THAT - This Court has already observed that an oral exchange of immovable property worth ₹ 100/- was impermissible. Therefore, the plea of exchange as set up by the defendants was rather not maintainable as no valid title would pass in their favour. That apart, once there was admission by defendant No. 3 in his cross examination with regard to execution of exchange deed, then it was incumbent upon defendant No. 3 to have produced the said deed or else an adverse inference was required to be drawn. To say the least, the findings recorded by the learned first appellate Court are totally perverse and contrary to law. Accordingly, this question is decided in favour of the appellants. This Court has no hesitation to conclude that the findings rendered by the learned first appellate Court are not only perverse, but are contrary to law and are, therefore, not sustainable - Appeal allowed.

Summary

Issues Involved:
1. Legality of Mutation No. 392 in favor of Defendant No. 3.
2. Legality of the Sale Deed dated 3.10.1994 executed by Defendant No. 3 in favor of Defendant No. 4.
3. Entitlement of Plaintiffs to possession of the suit land.
4. Plaintiffs' cause of action.
5. Maintainability of the suit.
6. Plaintiffs' locus standi.
7. Estoppel against Plaintiffs.
8. Misjoinder of parties.
9. Jurisdiction of the Court.

Issue-wise Detailed Analysis:

1. Legality of Mutation No. 392 in favor of Defendant No. 3:
The plaintiffs challenged Mutation No. 392 dated 14.7.1994, claiming it was procured fraudulently and without their presence or consent. The trial court declared the mutation null and void, but the first appellate court reversed this decision. The High Court emphasized that mutation entries do not confer title and are only for revenue purposes. The court reiterated that oral exchanges of immovable property worth more than ?100 are impermissible under the Registration Act, 1908, and thus, the mutation based on such an exchange was invalid.

2. Legality of the Sale Deed dated 3.10.1994 executed by Defendant No. 3 in favor of Defendant No. 4:
The plaintiffs argued that the sale deed was based on the fraudulent mutation and thus invalid. The trial court agreed, declaring the sale deed null and void. The first appellate court's reversal was based on the assumption that the father of the plaintiffs had the authority to consent to the mutation, which the High Court found erroneous. The High Court confirmed that without a registered exchange deed, the sale deed could not be valid.

3. Entitlement of Plaintiffs to possession of the suit land:
The plaintiffs sought possession of the land based on the invalidity of the mutations and sale deed. The trial court granted this relief, which was reversed by the first appellate court. The High Court restored the trial court's decision, affirming the plaintiffs' right to possession due to the invalidity of the underlying transactions.

4. Plaintiffs' cause of action:
The defendants argued that the plaintiffs had no cause of action. The trial court disagreed, and the High Court upheld this finding, noting that the plaintiffs had a valid cause of action based on the fraudulent transactions affecting their property rights.

5. Maintainability of the suit:
The defendants contended that the suit was not maintainable. The trial court found the suit maintainable, and the High Court agreed, emphasizing the plaintiffs' right to challenge fraudulent transactions affecting their property.

6. Plaintiffs' locus standi:
The defendants questioned the plaintiffs' locus standi. The trial court affirmed the plaintiffs' standing, and the High Court concurred, noting that as rightful owners, the plaintiffs had the standing to challenge the fraudulent mutations and sale deed.

7. Estoppel against Plaintiffs:
The defendants claimed that the plaintiffs were estopped from filing the suit due to their conduct. The trial court rejected this argument, and the High Court upheld this decision, finding no basis for estoppel.

8. Misjoinder of parties:
The defendants argued that the suit was bad for misjoinder of necessary parties. The trial court found no misjoinder, and the High Court agreed, noting that all relevant parties were properly included in the suit.

9. Jurisdiction of the Court:
The defendants challenged the court's jurisdiction. The trial court affirmed its jurisdiction, and the High Court upheld this finding, confirming that the court had the authority to adjudicate the matter.

Conclusion:
The High Court allowed the appeal, setting aside the first appellate court's judgment and restoring the trial court's decree. The mutations and sale deed were declared null and void, and the plaintiffs were granted possession of the suit land. The court emphasized the legal requirement for registered documents in transactions involving immovable property worth more than ?100 and reaffirmed the limited role of mutation entries in conferring title.