UMRAO SINGH Vs. RAUNAK SINGH

JUDGEMENT

(1.) This application under Section 25, Small Cause Courts Act, is made by the defendant in a suit on a hand-note which was admittedly executed by him. Receipt of the consideration was also admitted, but the defence was taken that he had executed the hand-note as an agent on behalf of one Mt. Ramsawari Kuer from whom the plaintiff had agreed to buy certain properties, that the plaintiff had paid the amount mentioned in the hand-note as earnest money for his purchase, that the sale had fallen through on account of the plaintiff's default and that the earnest money was therefore forfeited, while the hand-note was only a "nominal document" executed by the defendant in proof of plaintiff's payment. The learned Judge below held that Section 92, Evidence Act, "bars any oral evidence in support of the defence" and as the execution of the handnote and the passing of consideration thereunder were admitted, he decreed the suit without any further evidence.

(2.) It has been contended on behalf of the defendant-applicant that evidence in support of his plea was wrongly excluded by the lower Court. Section 92, Evidence Act, no doubt excludes oral evidence to contradict, vary, add to, or subtract from, the terms of any contract which have been reduced to the form of a document. But Proviso 3 to the Section lays down that the existence of any separate oral agreement constituting a condition precedent to the attaching of any obligation under such contract, grantor disposition of property may be proved. This has been considered in a recent decision of the Judicial Committee, Rowland Addy v. Administrator General of Burma where Lord Wright pointed out a distinction relevant to the application of Proviso 3. A collateral agreement which alters the legal effect of a written instrument must be excluded, but an agreement that the instrument should not be an effective instrument until some condition is fulfilled, e.g. an agreement suspending the coming into force of the contract dontained in the promissory note (then under consideration) constitutes a condition precedent within the terms of the proviso and may therefore be proved.

(3.) The written statement of the defendant has been placed before me and may be summarized as amounting to this, that the handnote is only a receipt for the earnest money, that the purpose for which the money was received has been wrongly stated in the handnote and that it was not intended to attach any obligation to the handnote as such at all or (as seems to be implied) at any rate until Mt. Ramsawari Kuer failed to complete the sale to the plaintiff unjustifiably. Handnotes given in somewhat similar circumstances are nob unknown; see for example, Ahmed Saheb Bapu Saheb V/s. Ubhaiya Harsi A.I.R (1924) . Bom. 44, a one of the oases cited in the lower Court, in which the note was given by way of indemnity for a contingent liability, and Shah and Kemp JJ. held that evidence of the separate agreement was admissible and that the decision in Vishun Ramchandra V/s. Ganesh Krishna A.I.R (1921). Bom. 449 (also referred to below) was distinguishable on the facts. In Rowland Addy V/s. Administrator General of Burma the view taken in Calcutta was approved that the proper meaning of prov. (3) to Section 92 is that the contemporaneous oral agreement to be admissible must be to the effect that a written contract was to be of no force at all and was to constitute no obligation until the happening of a certain event, which in this case would apparently be an unjustifiable failure on the part of the lady to do her part in the projected sale.