S KANDASAMI Vs. APARANJI CHETTIAR

JUDGEMENT

(1.) THE defendant, who failed in the courts below, has preferred this second appeal. He entered possession of the suit property, which is a building under a contract with one Velu, who was the owner of the building on 2. 9. 1975. He paid a sum of Rs. 4,000 to the said Velu, who executed a promissory Note, marked as Ex. B-1. As per the recitals in the promissory note, interest was payable at the rate of 12% p. a. He gave another sum of Rs. 1,000 on 1. 5. 76 as evident from Ex. B-2 and another promissory note was executed under which also, Velu had agreed to pay interest at the rate of 12% per annum.

(2.) ON the date of the execution of the first promissory note, a document was brought into existence, which is marked in the appellate court as Ex. B-3. The caption in the document is [rental agreement muchalika ). In the preamble, it is described as It can be roughly translated into English as'a document of deposit muchalika relating to house rent'. In the body of the document, it is stated that the owner of the building had received Rs. 4,000 and had executed a promissory note for the same. It is further recited that for the purpose of interest due on the promissory note, the defendant shall enjoy the property for a period of five years by residing therein. There is no rent for the house and no interest for the promissory notes, as has been decided by the Panchayatdars and accepted by the parties thereto. That portion of the document reads as follows: The next part of the document reads that at the expiry of the period of five years of enjoyment, the party of the first part, that is, the owner of the building, shall return the sum of Rs. 4,000 to the party of the second part and get possession of the property. It is also recited that even if the party of the second part does not reside in the house and simply keeps it locked, there is no question of payment of any interest on the amount given. It is also recited that if any repair is to be effected during the period of five years, it should be carried out by the party of the second part i. e. , the defendant herein. The tax for the house is to be paid by the party of the first part i. e. , the owner. Two copies of the document were made out, one copy was kept by the owner and the other given to the defendant.

(3.) IN my opinion, a perusal of the document shows that it is an anamolous transaction, which cannot be brought under any legal label either as a lease or as a mortgage. But, it is very clear that the amount paid by the appellant to the previous owner of the building was only a loan and a promissory note was executed on the very same date. INstead of paying interest for the loan, the owner permitted the appellant herein to reside in the house. I have already extracted the recital, which says that that for the purpose of pay-merit of interest on the amount, the appellant is to reside in the house for five years and enjoy the same. Even though the caption is to the effect that it is a rental agreement muchalika, the nomenclature cannot conclude the real nature of the transaction. It is a general rule that the law does not impute intention to enter into legal relationship where the circumstances and the conduct of the parties negative any intention of that kind. If the court can find the true and real relationship between the parties notwithstanding the ornamentation or exaggeration of the parties, the court should give relief according to law see Lakshmi Ammal v. Sivakamunatesan, (1969)2 M. L. J. 626. IN my view, it is only anamolous transaction in which the appellant was put into possession of the property for a period of five years and at the end of which he should deliver back possession of the property on receipt of the amount lent by him to the owner of the building. Admittedly, the amount has been repaid to the appellant and he is obliged to deliver possession of the property.