THAKER GANPAT Vs. SUKHRAM

JUDGEMENT

(1.) IN the present suit for possession of the suit land which had come into the possession of the defendant as a result of a so called oral mortgage entered into by him with the plaintiff and whereby he had advanced as consideration a sum of Rs. 200/ - to the plaintiff, the trial court having held that such a mortgage was unenforceable, passed a decree for the possession of the said land but on condition that the plaintiff would pay back the sum of Rs. 200/ - received by him from the defendant. On appeal, the learned Senior Subordinate Judge, Jammu arrived at the finding that as the mortgage was oral and therefore legally unenforceable, the plaintiff was nothing, more than a mere debtor of the defendant liable to make payment of Rs. 200/ - to the defendant which, he the plaintiff` had admittedly received as consideration. The Senior Subordinate Judge further found that the defendant being a creditor pure and simple, shall have to bring a suit for the recovery of this, amount of Rs. 200/ - in a Board constituted under the Distressed Debtors Relief Act within the time -limit fixed by that Act. The learned Senior Subordinate Judge appears to be of the view that the plaintiff is not bound to restore to the defendant the benefit received by him the plaintiff` under the -unenforceable agreement, before getting back the possession. The Senior Subordinate Judge has held that the defendant not having brought the suit for the -recovery of Rs. 200/ - in time, the debt itself was extinguished and the defendant was not, therefore, entitled to get any relief so far as this amount was concerned. The learned Senior Subordinate Judge therefore passed a decree for possession in favour of the plaintiff without any condition of making payment to the defendant. The defendant has -now come up in second appeal to this Court.

(2.) ` There can be no denial to the fact that according to the provisions of the Transfer of Property Act a mortgage which has not been effected by a registered document is not enforceable at law, and as such the defendant cannot retain as of right the possession of the suit land on the basis of a transaction which is euphemistically styled by the parties as an "oral mortgage." But the question will still crop up in this case as to whether the plaintiff can or shall in the circumstances of the present case be treated as a mere debtor of the defendant who ought to have been sued by the defendant in a Board constituted under the Distressed Debtors Relief Act within the specific period prescribed in the Act. This too goes without saying that if the amount advanced was a mere debt, the suit should have been brought within the prescribed time in a Court constituted under the said Act, and in the absence of such a suit, the debt would stand extinguished. But the point involved in the present case is not so simple as made out by the Senior Subordinate Judge. The trial court has taken a more sensible view in deciding this point. It has remarked: "I am of the opinion that the plaintiffs land was with the defendant in consideration of Rs. 200/ - advanced by the latter to the former, and the latter was not competent to file a suit for recovery of the amount and at the same time keep the land in possession. Now when the plaintiff has come in the Court, he must come with clean hands. He cannot demand the land back, resist the payment of Rs. 200/ - that had been accepted by him when handing over the possession. Equity and justice demand that the plaintiff should return the amount before he gets possession of the land." This finding of the trial court finds support from the plaint itself. The plaintiff in his plaint avers that he had mortgaged the suit land to the plaintiff by means of a Rahan Khangi which might mean a private mortgage` in consideration of Rs. 2OO/ - received by him from the defendant. Now from this averment in the plaint it would appear that both the parties were under the impression that they had executed a valid mortgage in pursuance whereof possession was given to the defendant and the consideration was received by the plaintiff, and as the suit land was in possession of the defendant, no question of his instituting a suit for the amount of Rs. 200/ - advanced by him would have arisen as long as the land was in his possession. The long and short of all this is that the parties, did as a matter of fact, intend to enter into a mortgage agreement, and they acted on it, though the mortgage was entered into without fulfilling the legal formalities which might make or has made it unenforceable at law. As a matter of fact this is an agreement which is destitute of any legal effect from its very inception. In such cases the provision of law applicable would be S. 65, Contract Act which runs as follows: "When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it, or to make compensation for it, to the person from whom he received it."

(3.) ` Now in the present case we find that it was very late in the day that the parties discovered that the agreement entered into by them was void. There are a number of authorities in which it has been laid down that under the circumstances as obtain in the present case, i.e., where the parties had entered into an unenforceable or void agreement and a party had received an advantage under it, the said party was held bound to restore the advantage received by it. Section 65, Contract Act was held applicable in such cases. Reference may in this connection be made to - Usman Khan v. Sitara Khan, AIR 1935 All 256 A` in which it has been held that: "Where the deeds are mortgages of occupancy land which is forbidden by the Tenancy Act they come under Section 23 as agreements where the consideration or object was forbidden by law. The deeds cannot be enforced in any manner, even as simple money bonds and therefore, the plaintiff cannot sue for the promises of payment of principal and interest in the bond, nor can he rely on the covenant in the bonds that if possession is not given, then the plaintiff should receive back the money. But the plaintiff has a right under S. 65 to the return of any money which he has been able to prove that he has advanced to the defendant under these void bonds." In an earlier Privy Council ruling reported as - Thakurain Harnath Kuar v. Thakur Indar Bahadur Singh, AIR 1922 PC 403 B`, it has been held that in an agreement of sale which is manifestly void from its inception, the vendee is entitled to the purchase money advanced by him.