BALMUKUNDA MISHRA Vs. LALIT MOHAN MISHRA

JUDGEMENT

(1.) In this appeal by the plaintiffs the only question for consideration is whether the defendants can resist the claim of the plantiffs to recover possession by setting up their title and possession under certain mortgage bonds. On 5 April 1935 by means of threef transactions three usufructuary mortgage bonds for Rs. 99, Rs. 99 and Rs. 22 res-pectively were executed by the tenants defendants 3 to 5 in favour of defendants 1 and 2. Defendant 3 was the deceased occupancy tenant of the disputed holding, and defendant 6 is the pattidar lambardar. The mortgagees continued in possession from that date till 1937, when they were dispossessed by the plaintiffs on the strength of a deed of surrender which was executed by defendants 3 to 5 in favour of the lambardar. The plaintiffs are the cosharer- lambardars, but by arrangement among themselves the disputed holding had fallen into the share of the plaintiffs. The mortgagees became successful in a criminal proceeding and also in a suit brought under Section 9, Specific Relief Act. The plaintiffs, therefore, have instituted this suit giving rise to this appeal on 13th May 1940 for a declaration that the mortgage bonds in favour of defendants 1 and 2 are bogus, without consideration, illegal and inoperative and for recovery of possession. The Courts below have concurrently come to the conclusion that the mortgage bonds are genuine and for consideration. They have also held that the execution of the three mortgage bonds was a device to get behind the provisions of the Registration Act and of Section 46, Central Provinces Tenancy Act (Act 11 of 1898). But nevertheless they have found that the possession of the mortgagees must be affirmed, and that the plaintiffs are only entitled to recover possession upon their paying the amount for which the mortgage bonds were executed, namely, Rs. 220.

(2.) In appeal Mr. Sen Gupta argues that when it has been found that the three mortgage bonds were executed as a device to get behind the Registration Act and the provisions of Section 46, Central Provinces Tenancy Act, the mortgages are invalid in the eye of the law. I do not agree with this contention. It is open to a party to avoid the provisions of a penal statute like the Income-tax Act, the Registration Act, and so on, provided he does not infringe the law. The parties entered into three transactions by splitting up the mortgage amount and also the mortgaged security. I do not see how they have infringed any law, although they have been successful in avoiding the stringent provisions of the Registration Act and the C. P. Tenancy Act. The matter was elaborately considered in the well- known Inland Revenue Commissioners V/s. Duke of Westminister (1936) 1936 A. C. 1 by the House of Lords, and it was held that it is open to an assessee to keep clear of the net of the Income-tax Act if he can do so by entering into documents by which he would so arrange the disposition of his property that the income could, not be taxed. Such an act may be unsocial by avoiding the burden of taxation and passing it on to others shoulders, but it is not illegal.

(3.) Moreover, the provisions of Section 53A, T. P. Act, would help the defendants. They have got in their favour unregistered documents, by which the terms upon which the transfers were made can be ascertained, and they are in possession by virtue of and on the foot of those documents. In my opinion, the Courts below have taken the correct view of the matter. The appeal fails and must be dismissed. In the circumstances, there will be no order for costs of this Court.