Fakhar-ud-din vs. Muhammad Iqbal and others (Lahore High Court)

Fakhar-ud-din vs. Muhammad Iqbal and others (2015 CLC 994)

Lahore High Court

Before: Muhammad Khalid Mehmood Khan and Abdus Sattar Asghar, JJ.

Facts:

On 16.02.2005 Fakhar ud Din (deceased represented by legal heirs) (“Appellant”)?filed a suit for declaration of his ownership and possession in suit land and cancellation of registered sale-deed dated 27.04.2004 allegedly executed in favour of respondents Nos.1 to 6 (“Respondents”). The Appellant contended that the registered sale deed was without consideration, outcome of fraud and undue influence, and therefore was ineffective. Whilst in the impugned registered sale deed the amount of consideration of PKR 45,00,000/- is mentioned as having been received, the Appellant denies such receipt in his plaint. Additionally, in the sale deed the delivery of possession to the respondents has been mentioned which is also denied by the Appellant.

Respondents Nos. 1 to 6 filed written statement contending that they purchased the suit land with consideration in good faith and that the Appellant executed a registered sale deed upon which possession was also given. The key argument advanced by the Respondents was that the impugned sale deed being a registered document has a presumption of truth which cannot be defeated by oral evidence as per Article 103 of the Qanun-e-Shahadat Order 1984 (“QSO”). Article 103 of the QSO provides that when terms of contract are reduced in the form of a document which have been proved no evidence of oral agreement shall be admitted for purpose of contradicting or varying the terms in the document.

The trial court, Civil Judge 1st Class dismissed the suit of the Appellant on 19.10.2011 upon which a regular first appeal was filed under section 96 of the Code of Civil Procedure 1908.

Issue: Whether the impugned sale deed is invalid for want of consideration and the Appellant was duped to execute the sale deed as a result of deceit and undue influence?

Held: The impugned sale deed is invalid for want of consideration and the Appellant was duped to execute the sale deed as a result of deceit and undue influence practices on him.

Reasoning:

·??????Neither in the sale-deed or the written statement is it mentioned as to when, where and how the consideration was paid by the vendees to the vendor. Muhammad Azhar Hameed Advocate, the Respondent’s witness, (DW-1), the alleged scribe of the sale deed, has not uttered a single word with regard to the amount of consideration or its payment in his examination in chief. Muhammad Iqbal (DW-2), one of the Respondents, stated that of the consideration PKR 3,00,000/- was paid fifteen days before the registration of the sale deed and PKR 42,00,000/- was paid two days before the registration of the sale deed. No mention was made as to in whose presence the amounts were paid, nor were any receipts scribed. Since passing of consideration in lieu of sale is not established on the record therefore impugned sale was a sham and void transaction as not proved in accordance with law.

·??????It was not proven that possession of the suit land was given. During cross-examination DW-2 admitted that possession is with the legal heirs of the Appellant. It was mentioned by DW-2 that the respondents had possession for 19/20 days but he has failed to explain how the Respondents lost possession. The Respondents lodged a complaint under the Illegal Dispossession Act 2005 which was dismissed as withdrawn. No effort was made by respondents to make recovery of possession under law. Moreover, Muhammad Ali, the marginal witness of the sale deed (DW-4) in cross examination admitted that possession of the suit land was not obtained by the respondents at the time of registration of sale deed.

·??????A sale is a transfer of ownership in exchange for a price paid or promised or part-paid and part-promised under section 54 of the Transfer of Property Act 1882. A valid sale transaction therefore must have the following elements: (i) valid sale agreement; (ii) parties to the sale transaction; (iii) sale consideration fixed and paid; and (iv) the subject matter of the sale transaction. If any of the aforementioned ingredients are missing the transaction would not fall within the definition of a sale. Payment of price (iii) is an essential ingredient and no sale can be said to take place without it. The Respondents have failed to prove with sufficient evidence that such price was indeed paid.

·??????Whilst there is no cavil to the proposition under Article 103 of the exclusion of oral agreements/evidence?when there is a written contract on a matter, the proviso thereto provides an exception. Proviso (1) stipulates that any fact may be proved which would invalidate any document on grounds such as fraud, intimidation, illegality, want of due execution, want of capacity, want or failure of consideration or mistake in fact or law. Therefore, where a case is one in which the validity of the sale deed is itself in question for any of the aforementioned reasons, evidence could be led, not to alter the terms of the document but to prove its invalidity. The proviso (1) of Article 103 of the QSO opens the door for courts to inquire into the real nature of the transaction.

·??????It is well-settled that a false acknowledgement of receipt of price by a recital in a deed does not estop the seller from giving evidence against the buyer that payment was not received. The Privy Council in Shah Lal Chand vs. Indarjit (1900 22 All. 370) held that notwithstanding an admission in a sale deed of receipt of consideration, it is open to the seller to prove that no consideration has been paid. Such a recital though, however, may give rise to a presumption of payment. Notwithstanding the aforesaid, the party who has acknowledged the receipt of consideration in the sale deed can show that he did not receive it.

·??????There is ample evidence on record to establish that the Appellant being unhappy on account of disobedience of family members parted himself from them. During such period he was enticed by the Respondents to execute the sale deed. The son of the Appellant had lodged a case under section 364 of the PPC in 2004 against the Respondents. The Appellant categorically contended that the Respondents got executed the sale deed from him under undue influence and without consideration. At the time of registration of sale deed the Appellant was an old man and as per DW-4’s cross examination it was not denied that the Appellant was suffering from high blood pressure and cardiac diseases. Moreover, at the time of registration of the Sale Deed the Appellant did not have any independent advice. When there is allegation of fraud or deceit by an old man who had no independent advice and has been deprived of his valuable property by a document onus automatically shifts upon beneficiary to prove its contents. Needless to say that element of undue influence is not restricted to an illiterate parda-nashin lady rather it could prevail even on men in the peculiar circumstances of a case.

·??????The Supreme Court in Qazi Altaf Hussain vs. Ishfaq Hussain (1986 SCMR 1427) has held that under section 60 of the Registration Act a presumption of correctness is attached to the certificate endorsed on the sale deed only for the purpose of proving that the document has been registered. BUT as regards receipt of consideration by the Seller, only a presumption arises out of the admission made by the Seller which could be contradicted by independent evidence as that relates to want of consideration and exercise of undue influence. Moreover, in Parshotam Das vs. Yar Ali (1928 AIR 439 Oudh) it was held that mere registration of sale deed does not pass title where there is no proof of (i) the transfer of possession of the property, nor (ii) payment of consideration.

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