Citation: 1967 AIR 1395
Case Type: Civil Appeal
Case No: 521 of 1964
Appellant: Kuppuswamy Chettiar
Respondents: A.S. P. A. Arumugam Chettiar and Another
Decided On: 06-09-1996
Statues Referred:
- Transfer of Property Act, 1882
Case Referred:
- T. Mammo v. K. Ramunni
- Hutchi Gowder v. Bheema Gowder
- S. P. Chinnathambiar v. V. R. P. Chinnathambiar
Bench: Bachawat, R.S. Wanchoo, K.N. Shah, J.C.
Facts:
The Grandfather Ponnuswami of the parties to the suit, had bequest the immovable properties to his paternal uncle’s daughter, Kannammal.
The above bequest was challenged by the respondent against several person including Kannammal, in January 1952. On February, 1952 Kannammal died leaving the appellant herein as the heir who her husband’s brother’s son.
Afterwards the appellant executed a deed in favour of the respondent whereby the suit properties were released including arrears of third party. And the same was registered on February 26th, 1952.
The respondent however filed an application seeking an order for the removal of the properties from the scope of the suit and that the plaint be amended accordingly. The same was allowed by the Court.
On January 22, 1953 the respondent instituted a suit for the recovery of one of the arrear mentioned in the release deed. The appellant filed a written declaration alleging the release deed as void and that the suit therefore was not maintainable. The same was decreed by Munsif.
On January 31, 1955 the appellant instituted a suit before the Supreme Court parying to set aside the release deed on the ground of misrepresentation, fraud, deceit and undue influence.
The appellant contended that the reason to apply for the abrogation of the release deed was that he had misconstrue the deed as the Power of Attorney authorising the respondent to manage the properties on appellant’s behalf.
The trial Court held that the deed was not spoiled by fraud, deceit, or undue influence but was vitiated by misrepresentation. And hence the trial Court decreed the suit but on an appeal, the same was set aside by the High Court.
Aggrieved by the High Court’s decision the appellant approached the Supreme Court.
Issue:
Whether the deed of release was invalidated by misrepresentation and if not then whether it operated as a conveyance of the suit properties in favour of the respondents.
Obiter Dicta:
When a registered instrument designed a release deed transfers the right, title and interest in the property in favour of the releaser for a particular consideration, then it shall operate as a conveyance. Hence in such cases, consideration is a sine quo non to operate the release deed as a conveyance.
Ratio Decedendi:
Hon’ble Court was in consonance with the rationale of the High Court that the appellant was well aware about the nature of the deed while executing it and therefore the release deed was not vitiated by misrepresentation.
The appellant took the deed to his lawyer and after procuring legal advice, had executed the release deed. The deed was presented for registration by the appellant himself.
After registration of the deed, he appellant barely cared as to how the respondent was managing the properties. While in the written declaration by the appellant there was no mention about the misrepresentation but only pleaded that the deed of release did not effectively pass title to the outstanding.
The plea of the appellant about the misrepresentation was an afterthought. Therefore the onus of proving misrepresentation was upon the appellant, whereby he failed.
The essential requirement of consideration in a release deed to operate as a conveyance stands missing in the instant case. In such a scenario when the property is transferred without consideration then it is called transfer by Gift.
Section 123 of the Transfer of Property Act, 1882, a gift can be conveyed by means of a registered instrument which should be signed by the donor and attested by atleast two witness.
The release deed stated that the releaser was the owner of the property. There was an intention to transfer its title but without consideration. Therefore in its true construction the deed took the effect of Gift.
A release deed can only feed title but cannot transfer title. Renunciation vest in a person who has a title to the estate and not in a person who does not possess.
In Hutchi Gowder v. Bheema Gowder, the apex Court held that for the covenant of further assurance a deed of conveyance was required to be executed. But such decision did not confer that a release deed was ineligible in transferring title to a person having who before the transfer had no interest in the property.
Judgment
The Apex Court’s bench comprising of Bachawat, R.S. Wanchoo, K.N. Shah, J.C, held the following:
In law, a deed designed a release deed cannot be held aback from transferring the title to a person who before transfer has no interest in the property.
Where the word transfer of property was used in the release deed then such deed cannot be set aside on the ground that no relinquishment was permissible.
Therefore the appeal was dismissed and cost was allowed.
Conclusion:
Where a deed of release is executed without consideration it operates as a deed of Gift. But the law itself does not outright any deed to transfer the title to a person who had no interest in the property before transfer. Simply stated a person must have a legal title to transfer it to person eligible for it. He who does not have, cannot give.
Kaushal Agarwal.