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Civil Appeal No. 161 of 1957, decided on 20th February 1961.
S. 58 (f)--‑Mort gage by deposit of title‑deeds‑Registration when required.
When in a transaction of mortgage by deposit of title deeds, such deeds are handed over accompanied by a document con stituting a bargain between the parties, such document require registration but when it merely records an already completed transaction it does not require registration as law supposes that the scope of the security is the scope of the title.
M. Subramonian and another v. M. L. R. M. Kutchman and others 28 C W N 1 P C and Sir Hari Sankar Paul Kt., and another v. Kedar Nath Saha and others 43 C W N 809 (P C) ref.
Principle varies from case to case‑Civil Procedure Code (V of 1908), O. VI, r. 4.
Fraud must be specifically pleaded and proved. Degree of adherence to this principle will vary from case to case and will depend on the facts of each case.
Abu Md. Abdullah and Syed A. N. M. Nasiruddin for Appellant.
Sabita Ranjan Pal, Birendra Nath Chowdhury and Ramani Kanta Bhattacharyya for Respondent.
This appeal is at the instance of the defendant and is directed against the judgment and decree passed by the learned Subordinate Judge, 1st Court, Pabna, in a suit instituted by the plaintiff respondent for declaration of title and for recovery of khas possession of the properties in dispute.
2. The case of the plaintiff in short is as follows: One Khitish Chandra Bhowmick and his wife Indu Prova Bhowmick mortgaged the suit properties on the 17th September 1942, along with other properties in equitable form by deposit of title deeds with the plaintiff. The defendant Khitish Chandra Bhowmick failed to clear up the dues and as such the plaintiff instituted Mortgage Suit No. 1 of 1948 for a sum of Rs. 59,577‑1‑9. The suit was decreed on compromise on the 6th April 1949, by which one year's time was granted to the judgment debtors to put in the decretal dues but as the judgment debtors failed to put in the decretal dues, the plaintiff put the decree passed in the Mortgage Suit into execution (Execution Case No. 2 of 1950). The properties were put to sale on the 22nd July 1950, and purchased by the plaintiff decree‑holder. Delivery of possession was taken on the 7th July 1953. Thereafter the plaintiff mutated its name in the Municipal register in place of the said Khitish Chandra Bhowmick and also in the Sherista of the landlord. One Superintendent of Police was a tenant in the disputed property at the time of the sale and when the plaintiff went to realise the rent, he refused to pay rent on the allegation that the defendant had objected against his payment of rent to the plaintiff on the ground that she had purchased the property in a certificate sale. This objection was intimated by the Superintendent of Police on the 12th November 1954. Hence the suit for decla ration of the plaintiff's title to the properties in suit described in Schedule kha' of the plaint and for a declaration that the defendant has no right, title and interest in the properties; that the plaintiff and not the defendant is entitled to receive rent for the said premises. In suit and if necessary for a decree for possession of the property in suit described in the Schedule on eviction of defendant. The last prayer was added on the 24th January 1957, inasmuch as the plaintiff in its original suit only prayed for confirmation of possession.
3. The suit was contested by the defendant. Her main defence in short is as follows: The plaintiff has no right, title and interest nor possession in the suit property. The property in question was never the subject‑matter of the mortgage given by Khitish Chandra Bhowmick in favour of the plaintiff. The Mortgage Suit and decree are fraudulent and collusive inasmuch as those things‑ have been brought about in order to defeat the rightful claim of the defendant. The defendant purchased the property in suit in a certificate proceeding started for realization of Income‑tax arrears against Khitish Chandra Bhowmick. The suit is bad for defect of parties as the Government has not been imp leaded in the suit. The suit is also barred by limitation.
The learned Subordinate Judge framed the following issues
"(1) Is the suit maintainable in its present form
(2) Is the suit bad for defect of parties
(3) Is the suit barred by limitation
(a) Is the Court fee paid sufficient
(5) Is the plaintiff entitled to get a declaration that the defendant has no right, title and interest to the properties
(6) To what relief, if any, is the plaintiff entitled
(7) Was there a valid and legal mortgage in respect of the properties in suit
(8) Are the alleged mortgage decree and sale there under legal and within jurisdiction and binding on the defendants
(9) Is the consent decree fraudulent and collusive
4. The learned Subordinate Judge after going through the evidence has come to the finding that the property in dispute was the subject‑matter of the mortgage suit; that the plaintiff had acquired good title and interests in the suit property; that the defendant's claim of title is barred by limitation as well as by the principle of lis pendens; that the suit was not bad for defect of parties; though the learned Subordinate Judge at the conclusion held: "The Government can, however, fall upon the property to whichever hand it goes for recovery of the income‑tax dues," that the mortgage in question was an equitable mortgage and that the mortgage decree and the sale were not collusive and in this view of the matter, decreed the suit of the plaintiff. Hence the present appeal at the instance of the defendant.
5. Mr. Abdulla the learned Advocate for the appellant, has placed the following points
(1) That the trial Court erred in holding that the suit land was the subject‑matter of the mortgage alleged to have been given by Khitish in favour of the plaintiff.
(2) That the trial Court erred in holding that the mortgage in question was an equitable mortgage.
(3) That the trial Court erred in holding that the defendant's claim is barred by the principle of lis pendens.
(4) That the trial Court should have held that in view of service of notice of sale of the property in dispute under the Public Demands Recovery Act, the defendant has acquired a good title and interest in the property.
(5) That the trial Court erred in holding that the mortgage decree and the sale there under were not collusive and fraudu lent.
(6) That the trial Court erred in holding that the suit was not bad for defect of parties in view of its finding that the Government can follow the property for realisation of income tax arrear due from Khitish, the mortgagor.
(7) That the building was not the subject‑matter of the mortgage and as such the suit so far the building is concerned should have been dismissed.
(8) That the defendant has got the right of redemption. .
(9) That as there was no final decree passed in the mortgage suit, which is not evident by any records, the sale under the mortgage is nothing but null and void and fraudulent.
6. As regards the first contention of the learned Advocate for the appellant that the suit property was not the subject matter of the mortgage, the mortgage suit and the sale, many documents and also oral evidence have been referred to by the learned Advocate in support of his contention. Exh. 1 (b), dated 14th September 1942, is a letter written by Indu Prova Bhowmick to the Manager of the Bengal Central Bank Ltd., Calcutta, by which she informed the Manager that the properties on which her husband Khitish wanted to borrow, though stood in her name were really purchased by her husband in her name. Of this document item No. 2 is the deed in question. It does not give any boundary but refers to only a deed Exh. 7, dated the 7th June 1937, Exh. 1 (a) is a letter from Khitish Chandra Bhowmick and N. C. Bhowmick to the Manager, Bengal Central Bank Ltd., Calcutta, dated the 17th September 1942. This letter was with the intention to put on record something regarding the money to be taken and mortgage to be created. Reference has also been made to those documents of Exh‑ 1 (b) of which item No. 2 is the matter in dispute at present. This document does not also give either the boundary or area of the property covered by that document. Exh. 7 is the title deed and is dated 7th June 1937. The deed stands in the name of Indu Prova Bhow mick but according to the statement made in Exh. 1 (b) by Indu Prova Bhowmick this property was acquired by her husband in her name for husband's benefit and enjoyment This document speaks of settlement of only 4 katha of khas land and the right has been described as Kayemi Mourashi Dar jote in kathas within 4.25 acres of land under Pabna Collectorate of Touzi Mahal No. 110 and 2230 consolidated at present Touzi No. 2230, khatians Nos. 818 and 819 hearing Dag No. 7.814 14/1120 and 14/1121‑4 kathas equal to 65 cents. The boundary that has been given is "North your (landlord) khas land, East, your khas land, South, Pattan of Sanaullah Chowdhury measuring 1 bigha, 5 khatas; West, Renuka Bala Rai Chowdhurani and are 4 katha being northern portion of Dag No. 8‑1. Dag No ‑ 8 North‑boundary of Gopalpur 4 khatas or 65 cents. Exh. 9 (c) is the plaint of the mortgage suit and item 1 of Schedules A and B is the matter in dispute. The boundary given in the document is as follows: North‑khas land of the jotedars; East khas land of the jotedara ; South‑land khas land of Mvi Sanaullah ; West the land of Renu‑kabala Rai Chowdhurani and which is covered by C. S. dag No. 8 north of which is Mauza Gopalpur, measuring, 65 land only. The area has been given as. 65 decimals. Exhibit 8 dated the 14th March 1953, a sale certificate in favour of the plaintiff shows sale of three plots of which plot No. 1 is in dispute. The boundary that has been given is as follows: North‑khas land of Malek Jotedar; East khas land of Malek Jotedar; South the lands held under settlement by Maulvi Sanaullah Saheb West khas land of Renuka Bala Rai Chowdhurani. Area six kathas. But the description of properties that has been given in Exh. C the sale certificate granted in favour of the defendant is as follows two‑storeyed building standing on Dag No. 8 recorded in khatian No. 686 and the boundary is: North Anath Bandhu and Bibhuti Bhusan Ghosh; East‑Babu Shyama Charan Roy; South‑Md. Sanaullah and West‑Renuka Bala Rai Chowdhurani. It bears the holding No. 495, Plot No. 8, J. L. No. 69 and measuring 10 kathas. From the title deed of the plaintiff it appears that 4 kathas of land was taken settlement of from the landlord by the wife of Khitish Chandra Bhowmick but in the plaint 4 kathas were claimed and the certificate of sale contains 6 kathas and the defendant's certificate of sale contains 10 kathas and the boundaries that has been given are not in any respect the same. No attempt has been made by the plaintiff to locate the land of Khitish Chandra Bhowmick as per Exh. 7 the kabuliyat executed by his wife on the 7th June 1937, and to show how an area of 4 kathas within the same boundary came to be 10 cottas. The boundary and area of 10 kathas in Exh. C shows that the properties covered by the Exh. C could not apparently be the subject‑matter of the mortgage, mortgage suit and sale.
7. No witnesses have come forward to say where the suit land stands but one of the plaintiff's witness has deposed that he does not know what was the subject‑matter of the mortgage executed by Khitish Chandra Bhowmick in favour of the plaintiff. From these four documents we find different boundaries and areas at least in the two of them. So it is very difficult to hold from these documents that the land covered by Exh. 7 is the land covered by Exh. C or by the plaint in the present suit. The plaintiff has not led any evidence to show that Khitish ever took settlement from the landlord any further land measuring 6 kathas which could make out 10 kathas as shown by Exh. C or 6 kathas as shown by Exh. 8, the sale certificate in the mortgage suits. The plaintiff has not also tried to rely on these documents in the locality and has not been able to explain away the discrepancy, in these documents. i n our opinion, as the boundary and the area stands as per stand these documents, it cannot be held that the lands of the present suit were the subject‑matter of the mortgage or of the mortgage suit and decree and the execution there under.
Though the plaintiff did not adduce any oral evidence regarding position of the different plots, it however produced some municipal receipts and rent receipts from the landlord. The plaintiff has relied on the following documents in order to prove that the present suit lands were the subject‑matter of the mortgage and also the mortgage suit. These are Exhs. 10, 10 (a), 10 (b), 10 (c), 10 (d), 10 (e), 10 (f), 10 (g), 10 (k) 10 (l) and 10 (m). Exh. 10 is a municipal receipt showing payment by the plaintiff of Municipal rates for a holding bearing No. 509 for December quarter of 1955‑5o Exh. 10 (a) also is a receipt for the rates given by the plaintiff for a holding No. 509 for the quarter ending December 1955‑56 and it is dated 28th November 1955. Exh. 10 (b) is another receipt of the Municipality for the rates given by the plaintiff for the holding No. 5o9 and it is dated 13th January 1955, Exh. 10 (c) is another receipt for the rates given by the plaintiff for the holding No. 509. It is dated 5th December 1955, Exh. 10 (d) is another receipt for holding No. 509 for the quarter of 1955‑56 and it is dated 13th September 1955, Exh. 10 (e) is another receipt for the holding No. 509 and it is dated 13th January 1955, Exh. 10 (f) is a Municipal receipt standing in the name of Indu Prova Bhowmick, wife of Khitish Chandra Bhowmick for a holding No. 455 and it is dated 20th August 1942, Exh. 10 (g) is another Municipal receipt for the rates given by Indu Prova for holding No. 459 and is dated the 20th August 1942, Exh. 10 (k) is another Municipal receipt standing in the name of Indu Prova for the holding No. 386/2 and is dated 22nd May 1942, Exh. 10 (1) is another Municipal receipt standing in the name of Indu Prova Bhowmick and is dated 17th June 1944, for the holding No. 455/1 and Exh. 10 (m) is another Municipal receipt for holding No. 455 and is dated 17th June 1944.
8. Exhs. 10 (f) and 10 (g) go to show that two buildings were standing at the time of the alleged mortgage but no reference has been made in either of the two letters Exhs. 1 (a) and 1 (b). Exhibits 10 (k), 10 (l) and 10 (m) also go to show some other holdings standing in the name of Indu Prova but curiously enough none of these buildings was mentioned either in the mortgage deed or in the letter written by Indu Prova or the letter written by Khitish Chandra Bhowmick and another. The evidence of non‑mention of any buildings in the mortgage deed conclusively goes to show that at a time when mortgage was created no buildings were standing on the land.
9. Apparently the aforesaid documents relied on by the plaintiff do not go to show that they relate to the properties in dispute in the present suit. The following is the description that has been given m the plaint of the present suit
"(Kha) schedule property which has mentioned in the sale certificate as purchased in the name of Mst. Aziran Nessa of Pabna.
(4) Within District Pabna, holding No. 495 and under Thana Pabna within Mouza South Ram Chandrapur bearing J. L. Number 69 khatian No. 686 and therein recorded as dog No. 8 together with a two‑storeyed building standing thereon with a tube‑well including the land underneath measuring 4 kathas with the garden therein standing in the name of Indu Probha Sardar, wife of the judgment‑debtor which was auction sold in the Certificate Sale for Income‑tax and purchased by Mst. Aziran Nessa of Atua and taken possession on 3‑1‑50.
North‑Anath Bandhu Ghosh and Bibhuti Bhusan Ghosh. West‑Renuka Bala Rai Chowdhurani, South‑Sanaulla Mia. East‑Babu Shyam Charan Rai, 4 (four) cottahs of land within the said boundaries."
This is also exactly the boundary of the land covered by Exh. C, the sale certificate of the defendant but curiously enough in one document area is 4 kothas and another document the area is 10 kothas which is absurd.
10. It is contended by the learned Advocate for the respon dent that holding No. 495 was the original holding of the properties in dispute and the present holding No. is 509. There is no allegation in the plaint that No. 495 was the original holding number of the disputed properties and the present No. is 509 and no evidence has been led and neither any records have been called for from the Municipality nor any officer from the Municipality has been examined by the plaintiff in order to prove that 495 was the original holding number of the land in dispute and the present holding number is 509. It is curious that in the plaint 495 holding has been given but the present holding No. 509 has not been given. The plaintiff has examined three witnesses. P. W. 1 who was present in September 194‑1. at Pabna cannot say which document of 1942 or 1944 relates to the property in suit. P. W. 2 is an accountant of the plaintiff Bank at Pabna He has deposed that they obtained possession of the suit land and that they mutated their names in the landlord's sherista as well as in the Municipal office but he has admitted that he is in service of the plaintiff since September 1953, long after the mortgage in 1942 and sale in 1950 and as such he is not a competent witness to say that the suit land was the subject, matter of the mortgage or mortgage sale. P. W. 1 is a com petent witness in this case inasmuch as he was an officer of the plaintiff's Bank at Pabna Office in September 1942, when the mortgage created by Khitish in favour of the plaintiff but he does not prove anything in dispute. P. W. 3 is a pleader and is a formal witness. He has stated that he attested the kabala and the kabuliyat of which he has no independent recollection. He does not speak that the suit property was the subject‑matter of the mortgage or of the mortgage sale. So we find that no evidence is coming forth from the plaintiff to show that the properties in dispute in the present suit were the subject‑matter of the mortgage or mortgage decree and sale nor is there any evidence to show that the number of the holding in dispute in the present suit was originally 495 and at present it is 509.
11. Plaintiff has also relied on Exhs. 6 and 6 (a). Exh. 6 is a rent receipt for 1355‑60 granted by the landlord in favour of the plaintiff for an area of 13 kathas and 14 chataks of land at a rental of Rs. 10‑6‑0. It is dated 28th March 1956. This receipt goes to show that the settlement was in respect of Dag No. 7 and a portion of Dag No. 8 Exh. 6 (a) is another rent receipt for the year 1361‑1362 and is dated 28th March 1956. It is for Dag No. 7 and a portion of Dag No. 8. It is also for a land measuring 13 kathas and 14 chataks. Both these receipts bear Mouza number 172 and khatian No. 818. So these two documents also do not help the plaintiff because they do not by themselves prove that the documents relate to the disputed land.
12. Defendant, on the other hand, has proved some exhibits, namely Exhs. A to A (26), showing realisation of rent from tenants from March 1950 to February 1953. She has also proved some rent receipts granted by the landlord Exh. B series. The rent in all these documents is Rs. 7‑8‑0 and the area is 10 kathas. Exhibit B series begins with August 1950 and ends with May 1952. Exhibit C also indicates that 10 kathas of land together with the‑‑ buildings of Khitish Bhowmick were put to sale in the certificate proceeding started by the Certificate Officer for the arrears of income‑tax due from Khitish Bhowmick.
From the aforesaid evidence discussed above, we are satisfied that the plaintiff has totally failed to prove that the suit land together with the buildings was mortgaged with the plaintiff and that the plaintiff auction purchased the suit land. The plaintiff's certificate of sale shows a purchase of 4 kathas of land within the specified boundary, whereas the defendant purchased in a certificate of sale 10 kathas of land within the specified 'boundary together with the building standing on 4 katha comprised in 10 katha of land together with other appurtenants. The boundaries and area in the said two documents do not tally.
13. Furthermore, there is no evidence to show that plaintiff mutated its name in the landlord's Sherista or in the Municipal office. Exhibit 1 (i) shows realisation of Rs. 5 from the plaintiff on the 28th March 1946, on account of mutation of its name. This cannot be any realisation in respect of the purchased land as the plaintiff purchased in 1950. Tile Municipal receipt exhibited in this case and referred to above goes to show that the plaintiff paid Municipal rates for the holding No. 509 from January 1955 before the institution of the present suit in June 1956 and not just after its purchase in 1950. Exhs. 10 (f), 10 (g), 10 (k). 10 (1) and 10 (m) show many holdings standing in the name 0: Indu Prova. No attempt has been made by the plaintiff it' connect the holding No. 495 in suit with holding No. 509 for which the plaintiff is alleged to have paid Municipal rates, either by examining any independent witness or by calling for the Municipal records and its officers Exhs. 6 and 6 (a), rent receipts granted by the landlord to the plaintiff, do not show that the plaintiff paid rent for the suit land measuring 4 katha but for 13 katha 14 chataks. Exh. 6 was granted for 1355‑1360 B. S. on the 28th March 1956, which is before the institution of the present suit and Exh. 6 (a) was granted for 136J‑1362 on the same day. These documents do not go to show that when 4 kathas of lank in dispute in the present suit was settled by the landlord with the plaintiff or the landlord recognized the plaintiff's purchase of 4 kathas in execution of the mortgage decree. In our opinion, these documents have been collusively obtained by‑ the plaintiff for tits purpose of the suit.
14. Mr. Pal urges that the letter Exh. 1 (e) written on, the 6th October 1953, by the Superintendent of Police, a tenant will go to show that holding No. 495 was renumbered as 509. It is curious that though so much reliance has been placed on the letter, no attempt has been made to procure that gentleman before the Court nor his signature in Exh.1 (e) has been proved. It is not in evidence that the Superintendent of Police is dead or his whereabouts are not known. In our opinion, the statement is not admissible in evidence and the letter has been brought into existence for the purpose of the suit.
15. Mr. Pal further contended that the question of identity of the land of the mortgage suit with the suit land does not arise as the defendant did not challenge the identity, rather admitted the same. This argument is not tenable for the following reasons : In the plaint the plaintiff claimed the suit land to have been purchased by it in auction s.31e and the first written state ment was drafted in that line. But subsequently when the plaintiff filed the sale certificate in Court on the 10th March 1957, the defendant filed additional written statement on the 11th March 1957, that is, the following day challenging the plaintiff's right by purchase of the suit land in an auction sale. On these pleadings an issue was raised on this question and the parties understood their respective cases and led evidence in support of their respective cases. The learned Subordinate Judge has dis cussed this issue at page 26 of the paper book and decide; against the defendant., The reason for his decision against the defendant is as follows: ----
"Exh. 7 the kabuliyat comprises 4 cottas of land and eastern boundary of this 4 cottas of land is bounded by the land of the lessor and the same land has been made the subject‑matter of this suit in schedule Kha' land. To the east of this land is the land of 6 cottas as covered by another kabuliyat dated 7‑5‑39 marked Exh. 7 (b) in favour of Khitish Chandra Bhowmick and to the east of this kabuliyat land is the land of Shyam charan, which land Shyamcharan obtained later on from the lessors. Schedule Kha' has been described in the plaint as comprising 4 cottas of kabuliyat Exh. 7 together with its adjoining eastern 6 cottas of land of kabuliyat Exh. 7 (b) and Shyamcharan has been shown to be on the east of the aggre gate 10 cottas. Therefore it appears that there is no discre pancy in description of the suit land as the schedule of the plaint."
The aforesaid observation is mostly based on surmises. Exh. 7 (b) is not in respect of 6 katsha but in respect of 3 Kattahs 14 chataks. The boundary given is quite different. Apparently Exh. 7 (b) does not relate to 6 katsha of Exh. C. No evidence has been led to connect this document with the suit land. The plaintiff has not led any evidence in order to show what is the present position of the disputed land and whether Khitish mortgaged the disputed land and whether the plaintiff purchased the disputed land in execution of the mortgage decree. No attempt has been made by the plaintiff to connect this suit land, rather the evidence of P. W. 1 is that he does not know which land was the subject‑matter of the mortgage of 1942 or 1944. It is further seen that 10 kathas of land has not been claimed by the plaintiff but 4 katha has been claimed whereas the defendant has claimed 10 kathas. There is no evidence that these Exhs. 7 and 7 (b) are in relation to the 10 kathas in dispute. We have also shown previously that Exhs. 10 (f), 10 (g), 10 (k), 10 (1) and 10 (n) show that several holdings stood in the name of the wife of Khitish Chandra Bhowmick as far back as 1942 to 1944. Furthermore by a compromise decree the plaintiff excluded some of the landed properties and only retained three properties out of many properties for the satisfaction of its debt.
16. Now coming to the question of possession, the plaintiff at the beginning claimed to be in possession and subsequently it amended its plaint and claimed for recovery of possession if necessary. The plaintiff has not been able to adduce any reliable evidence to prove its possession. We have already discussed the oral and documentary evidence and we find that the plaintiff has miserably failed to prove its possession while the defendant has satisfactorily proved her possession since the delivery of possession after her purchase in the certificate proceeding. The rent receipt granted by the landlord together with the oral evidence has conclusively established her possession. We also hold that the defendant has acquired a valid title by her purchase in a certificate sale for arrears of income‑tax due from Khitish and the suit properties were neither the subject‑matter of the mortgage nor mortgage sale for mortgage execution case. The plaintiff has totally failed to prove the title and possession in the suit land. The aforesaid finding on ground No. 1 is sufficient to dispose of the appeal but in view of the further points being raised we intend to take into consideration other two points only.
17. Mr. Abdulla, the learned Advocate for the appellant, has contended that the evidence in this case is sufficient to prove that no equitable mortgage was created. The plaintiff has relied on Exh. 1(a), a letter written by Khitish to the plaintiff Bank on the 17th September 1942. Relying on the contents of the document it is contended by Mr. Abdullah that it is not a memorandum of agreement but really it contains the terms of the agreement and as such it cannot be said to have created an equitable mortgage; while on the other hand Mr. Pal has contended that this is nothing but a memorandum of a pre existing mortgage and as such it is admissible in evidence and the mortgage in question that was created in 1942 was a mortgage by deposit of title deeds.
18. It is well settled that when title deeds are handed over accompanied by a document constituting a bargain between the parties, that bargain must rule and such document requires registration but when it merely records an already completed transaction it does not require registration as law supposes that the scope of the security is the scope of the title. Reference may, be made to the case of M. Subramonian and another v. M. L. R. M. Kutchman and others (28 C W N 1 (P C)) and the case of Sir Hari Sankar Paul Kt. and another v. Kedar Nath Saha and others (43 C W N 809 (P C)).
19. The learned Advocates have also referred to many cases in support of their respective contentions but in our opinion no hard and fast rule can be laid down for all the transactions whether creating mortgage by deposit of title deeds or creating a mortgage by some documents. The case shall have to be dealt with on the facts and circumstances of each case and with this view we want to approach the present case.
20. Exh. 1(a) is the letter in dispute. It is contended by Mr. Abdullah that it is not a memorandum of the pre‑existing mortgage but it contains bargains between the parties creating mortgage on that date, Exh. 1 (a) runs as follows:‑
This is to put up on record that this day I deposited with you at your Head Office in Calcutta the documents specified in the schedule hereto with intent to create an equitable mortgage upon all my right, title, interest and estate in the properties to which such documents relate for the purpose of securing due repayment to the Bank on demand of all moneys now owing or which may thereafter be owing from me either solely or jointly with any person or persons to the Bank whether on balance of account or by discounting or otherwise in respect of Bills of Exchange, Promissory Notes, Cheques and other Negotiable Instruments or in any manner whatsoever including interest, Bank charges and costs.
I further declare and put on record that the properties covered by documents 1, 2, 3 below stand in the benami of my wife Indu Prova Bhowmick but I am the real 16 annas owner thereof and the properties were acquired with my money."
In order to understand this we shall have to refer to the plaint in the mortgage Suit No. 1 of 1948, Exh. 9 (c). Paragragh 2 of the plaint of the mortgage suit runs as follows: --
"The defendant, a contractor, approached the plaintiff Bank for loan by way of overdraft in his account on the security of his bills of contract due from the Government or other bodies and on the security of some landed properties. The rate of interest agreed was seven and a half per cent per annum with monthly rests in the account."
Paragragh 5 runs as follows: --
"That accordingly the defendant executed necessary documents to effect such security re. the bills and from time to time deposi ted his bills with the Bank and authorised the plaintiff Bank to receive all payments of his bills and dues and intimated the parties concerned accordingly. The plaintiff states that the said bills were validly pledged or otherwise charged with the Bank for its dues. He also deposited with the plaintiff Bank at its Head Office in Calcutta on 17th September 1942, and also on 7th September 1944, the under-mentioned documents in Schedule A' below in respect of properties described in Schedule A' below and in respect of properties described in Schedule B' below. The said deposit was made with intent to secure by way of first mortgage all moneys that may from time to time or at any one time be due owing to said account arising in any manner whatsoever with all interest and costs."
If the contents of Exh. 1 (a) and these two paragraphs of the plaint be taken into consideration it is absolutely clear that Exh. 1 (a) is not a mere memorandum of previous mortgage but actually it contains the bargains between the parties and as such we hold that the mortgage in question was not a mortgage by deposit of title deeds for debts to be incurred but by Exh. 1 (a). Exhibit 1 (a), not being registered, is not admissible in evidence.
In this connection Mr. Abdulla has contended that there can be no mortgage by deposit of title deeds for a debt not already in existence. In support of this contention he has relied on the case of Jaitha Phima and another v. Haji Abdul Vyad Osman and another (I L R 10 Bom. 634) and the case of Madras Deposit and Benefit Society, Limited v. Connamalai Ammal and another (I L R 18 Mad. 29) and section 58 (f) of the Transfer of Property Act. It is further contended in this connection that as the plaintiff allowed the mortgagor Khitish Chandra Bhowmick to release some properties there was a innovation of the contract and as such the properties attached under section 7 of the Public Demands Recovery Act cannot be affected by the mortgage suit and the decree. In view of our above decision on the mortgage itself, we refrain from passing any opinion on this.
21. The last ground we want to deal with is on the question whether the mortgage decree and the sale held there under was a collusive one or not. It is well‑settled that fraud must be specifically pleaded and proved as contended by Mr. Pal, the learned Advocate for the respondent but in our opinion degree of adhrence to this principle will vary from case to case and will k depend on the facts of each ca‑se. In the present case a mere fraud has been alleged by the defendant and a suggestion was put to plaintiffs witness No. 1 who denied it deposing in cross-examination, namely:
"It is not a fact that we obtained the decree in collusion with him (Khitish).
Mr. Abdulla urges that his client cold not give the particulars of fraud as they were not within the knowledge of the defendant but they were within the knowledge of plaintiff' and Khitish and if materials on record establish fraud, mere absence of pleading of particulars dill not debar the Court from finding that the mortgage decree and the sale were collusively brought into existence between the mortgagor and the mortgagee. We think this contention of Mr. Abdulla has some force in view of the particular facts and circumstances of the present case.
22. The alleged mortgage was created on the 17th September 1942, and the mortgage Suit No. 1 of 1948, was instituted on the 2nd January 1948, for a sum of Rs. 55,577‑1‑9. Notice under section 7 of the Public Demands Recovery Act dated 21st June 1948, was served by hanging on the properties in question. On the 17th July 1948, in a certificate proceeding started for previous arrears of income‑tax due from Khitish the mortgagor and all the properties in question in the present suit were attached there under. Though Khitish filed a vakalatnama on the 17th February 1948, in the mortgage suit, he filed written statement on the 10th March 1948, and filed an objection against the appoint ment of the Receiver on the 8th May 1948. The application for appointment of a Receiver was allowed on the 12th June 1943, and 9‑6‑48 was fixed for appointment of a Receiver. Though on the 19th June 1948, the defendant prayed for time to prefer an appeal against the order allowing the application of the plaintiff for appointment of a Receiver but on the 29th June 1949, he filed an application for appointment of a Receiver supporting the plaintiff's application for appointment of a Receiver. It is contended by Mr. Abdulla that this change of front by Khitish was due to the fact that two certificate proceedings were filed against him on the 21st June 1948, vide Exhs. D and D (1). On the 22nd July 1948, appointment of Receiver was made final and the Receiver was directed to submit by 29th July 1948, a true and complete inventory of properties coming into his hands and the assets and liabilities connected therewith and the scheme of their management. Against this order the defendant moved the High Court without any success. On the 19th March 1949, the plaintiff filed an application for addition of Indu Prova, the wife of Khitish Chandra Bhowmick, the mortgagor as a defendant who already had entered appearance by filing vakalatnama on the same day, namely, 19th March 1949, and a compromise decree was passed giving a grace of one year.
23. On the .6th September 1949, the properties in suit were put to sale in execution of a certificate and were purchased by the defendant and the sale was confirmed on 3‑1‑1950. Khitish did not pay the decretal dues which was nominal within one year i.e., on or before 18th March 1950 and consequently, the compromise decree was put to execution and item 2 of the mortgage properties was purchased by the plaintiff on the 27th July 1950, for a paltry sum of Rs. 5,000. The sale was confirmed on 28th August 1950.
24: Mr. Abdulla contends that the aforesaid facts and the compromise decree itself will show that the solenama decree and the sale there under were fraudulent and collusive.
25. Exh. 9(c) the plaint in the Mortgage Suit No. 1 of 1948, shows that the total claim was Rs. 59,577‑1‑9 and six items of immovable property were subject to mortgage together with bills on the Executive Engineer, Rajshahi, which was for a sum of Rs. 36,491‑7‑7 and the bills of the Executive Engineer, Jalpaiguri, for a sum of Rs. 1,05.028‑9‑0 but curiously enough by the compromise two sets of bills amounting to Rs. 1,41,520‑0‑5 and three items out of 6 items were released from the mortgage suit and the items decree and the only item worth Rs. 15,060 were retained for the satisfaction of the claim of Rs. 59,577‑1‑9. It is contended by Mr. Pal that the bills were of foreign country and as such it was found expedient to give up claim on the bills and also some landed properties which were in the village, as it was not convenient for the plaintiff to recover. We do not find any substance in this contention. The bills were mortgaged and were attached in execution of the mortgage decree. The claim is Rs. 59,577‑1‑9 and the bills stood for about one lac and fifty thousand rupees. Even accepting the contention of Mr. Pal that the bills on the Executive Engineer, Jalpaiguri, could not be safely recovered which we do not accept, in that case also there is no earthly reason for giving up the claim of Rs. 44,517‑1‑9 the outstanding bills on the Executive Engineer, Rajshahi which is invariably within the jurisdiction of this Court. So in our opinion, the aforesaid facts conclusively go to show that the compromise decree in the mortgage suit and the sale were collusively brought into existence in order to avoid the liabilities under the two certificate proceedings amounting to Rs. 28,365‑6‑6 and the plaintiff has also fraudulently included in the present suit a property which was not the subject‑matter of the mortgage.
In the result, the appeal is allowed with costs, the judgment and decree of the trial Court are set aside and the suit is dismissed with costs.
S. B./A. H.
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