P L D 1961 (W (PLP)

(4) To what relief is the plaintiff entitled?"

4. The evidence in this case was heard by my brother Waheeduddin, J., and the case carne before me at the argument stage as the learned Judge had by then gone over to the Appeal Bench.

5. At the first hearing before me, issue No. 3 was struck off at the instance of the advocates of the parties as being unnecessary. This was because it was felt that the decree in the suit will not bind the other heirs of Abdul Karim, the husband of the defendant. On the same date an additional issue was framed at the request of Mr. Mushtaq Hussain, the learned Advocate for the defendant who had been freshly engaged in the case for the purposes of argument. Mr. Iqbal Ahmad, the learned Advocate for the plaintiff, did not object to the framing of this additional issue, because he frankly stated that this was a legal issue and could be raised at any point. Issue No. I‑A which was then framed is as follows :‑ "1‑A. Whether the deed dated 2‑7‑54, Exh: 5/1, is not admissible in evidence for want of registration. If so, what is the effect?" Neither party wanted to lead ady further evidence on this issue but detailed arguments were advanced by them on this legal question, and i shall now proceed to deal with this issue.

6. Issue No. 1‑A : The suit was instituted in the life time of the alleged mortgagee Mst. Begum but she died before any evidence came to be recorded and her sole legal representative Abdul Karim, her husband, was brought on record on 25‑3‑57, And he gave evidence in the case. The case of the plaintiff, as disclosed in the evidence of Abdul Karim, is that his wife Mst. Begum and he advanced various sums of money to the defendant Fatimabhai between 10th July 1952 and 8th February 1954, the total of which amounted to Rs. 60,003 and when a demand for the repayment of this money was made, the defendant mortgaged the property in question by means of an equitable mortgage which was executed by the defendant in presence of Me. Naqvi, Additional City Magistrate, Karachi (since screened out). Exhibit 5/1 purports to be the memorandum of equitable mortgage by deposit of title deeds and the question, which falls for consideration under this issue is whether this document is inadmissible for want of registration.

7. This so‑called memorandum of equitable mortgage is written on five pages of stamp paper, the total value of the samp being Rs.

54. Since the important question on this issue is whether this writing, Exh. 5/1, is itself the contract of mortgage, it would be useful to reproduce the portion which is relevant for the consideration of the point. This is how it reads :‑ "WHEREAS the Mortgagor being in need of money to enable her to carry on business approached the Mortgagee for advances. AND WHEREAS the Mortgagee lent and advanced to the Mortgagor to carry on and conduct her business various sums of money between July 1952 and February 1954 aggregating the sum of Rs. 60,

000. AND WHEREAS the Mortgagee made a demand of the Mort gagor to repay the said sum of Rs. 60,000 which she had borrowed. AND WHEREAS the Mortgagor being unable to repay the said sum of Rs. 60,000 lent and advanced as aforesaid the Mort gagee threatened to adopt legal proceedings against the Mort gagor for the realization of the same. AS WHEREAS the Mortgagor to avoid such legal pro ceedings has offered to secure the said sum of Rs. 60,000 by creating an Equitable Mortgage in favour of the Mortgagee for the said sum of Rs. 60,000 by depositing the Title Deeds of the property situated at (formerly) plot No. 32/2 and Survey No. A26/P02) and (now Survey No. Plot No. N.P. 12) as security and with the intent to create first charge in respect of the said property for the due repayment of the said sum of Rs. 60,000 to which the Mortgagee has agreed. NOW THESE PRESENTS WITNESSETH that in con sideration of the sun of Rs. 60,000 (Rupees Sixty Thousand) lent and advanced by the Mortgagee to the Mortgagor as aforesaid (the receipt whereof is hereby also acknowledged) the mortgagor has "this day deposited with the Mortgagor in Karachi the Documents of Title specified in Part II of the Schedule hereunder written relating to the said premises morel particularly described in the Part I of the Schedule hereunder with the intent to create a security thereon, and as a first charge for the due repayment of the said sum of Rs. 60,000 with interest thereon at the rate of 9 per cent. per annum, payable 8 monthly with quarterly rest in account, and of all costs between Advocate and client of and incidental to these present and 'of suit or proceedings (if any), to enforce payment of the said loan." Section 59 of the Transfer of Property Act provides that where the principle money secured is Rs. 100 or upwards a mortgage other than a mortgage by deposit of title deed can be effected only by registered instrument. The exemption from registration is thus only in the case of mortgage by deposit of title deeds which is defined by section 58 (f ) of the Transfer of Property Act. That section provides that where a person (in certain towns) delivers to a creditor or his agent document of title to immovable property with intent to create a security thereon the transaction is called a mortgage by deposit of title deeds.

8. It would thus be plain that a mortgage by deposit of title deeds does not require any writing, and being an oral transaction is not affected by the law of registration. It is however usual in these transactions that such deposit of title deeds is accompanied by a memorandum in writing. The question which often arises is whether the writing was of such a character as to require registration. The decision of that question must necessarily turn upon the nature of the document itself though assistance may be had from the consideration of the surrounding circumstances.

9. There is considerable case law upon the point but I do not propose to delve into them because it appears to me that the, question has teen sufficiently settled by the pronounce ment of the Privy Council. In the case of M. Subrarnanian and another v. M. L. R. M. Lutchman and others (A I R1923 PC 50) their Lordships quoted with approval a passage from the leading case of Kedarnath Dutt v. Shamlall Khettry (11 B L R 405) which was to the following effect :‑ "The rule with regard to writings is that oral proof cannot be substituted for the written evidence of any contract which the parties have put into writing. And the reason is that the writing is tacitly considered by the parties themselves as the only repository and the appropriate evidence of the agreement." They then went on to observe as follows :‑ "If this memorandum was of such a nature that it could be treated as the contract for the mortgage and what .the parties considered it to be the only repository and appro priate evidence of their agreement, it would be the instrument by which the equitable mortgage was created, and would come within section 17 of the Registration Act." Upon this test their Lordships found that in the case before them the memorandum in question was the bargain between the parties and as it was unregistered it was liable to be rejected. Their Lordships particularly quoted the following extract from the memorandum :‑ "We hand you herewith title deeds, etc. This please hold as security, etc . . . . . . Please also hold this as further security."

10. In another case of Sundarachariar and others v. Narayana Aiyyar and others (A I R 1931 P C 36), their Lordships was construing a memorandum of deposit of title deeds for the purpose of determining whether it was compulsorily registerable. In the case the defendant, which was a joint family, owed‑the plaintiff a certain sum of money and wanted a further advance so as to make a total debt of Rs. 60,C00. . Negotiation for this had been carried on between the plaintiff's son and the manager of the joint family. On the date when the transaction took place the manager had handed over the title deeds to the plaintiff's son with two documents, one of which a promissory note for Rs. 60,000 payable on demand with interest at one per cent per mensem and second memorandum which consisted of the list of the title deeds with the following introductory words: "Written to E. N. A. Samoo Battar by Krishnaswami Ayyar, of S. V. Ramasami, Ayyar & Brothers. As agreed upon in person I have delivered to you the under mentioned documents Construing this second document their Lordships observed :‑‑ "It records particulars of documents which, it states, have been delivered as security in pursuance of an agreement reached in person. It does not state what were the terms of the agreement or indicate the nature of the matter for which the deeds were deposited as security." Their Lordships further held that there was nothing in the circumstances connected with the creation of .the memorandum which permitted some other meaning or effect to be given to it. Their Lordships therefore held that this memorandum did not require registration and observed that the memorandum in the earlier care of Subramanian v. Lu'chman was different from the memorandum in question inasmuch as that memorandum was held to embody the agreement between the parties.

11. The question came up again before Privy Council in the case of Sir Hari Shankar Paul and another v. Kedar Nath Saha and others (A I R 1939 P C 167). Their Lordships quoted extensively from the two earlier pronouncements which have been referred to above and then proceeded to examine the facts of the case before them. Then pointed out that the examination of the memorandum in question showed that it contained all the essentials of the transac tion. To quote their Lordships :‑ "It states that it is hereby agreed and declared between and by the parties that in consideration of the sums advanced .the title deeds of the property shall be held as a security on the said property and refers to any proceeding which may be had for the protection of this security or for procuring payment of the moneys hereby secured." Their Lordships held in this case that the document required registration under section 17 (1) (b) of the Registration Act and in conclusion observed as follows :‑ "Their Lordships are of opinion that where, as here, the parties professing to create a mortgage by deposit of title deeds contemporaneously enter into a contractual agreement, in writing, which is made an integral part of the transaction and is itself an operative instrument and not merely evidential, such a document must under the statute be registered."

12. In the light of the above principles laid down by high judicial authorities let me‑ now examine the memorandum in the present case in the light of the surrounding circumstances. It is the case of the plaintiff herself that no payment was made at the time when this memorandum of equitable mortgage was executed. The document itself recites that the advances aggregat ing Rs. 60,000 had been made between July 1952 and February 1954. The document then goes on to state that the mortgagor, being unable to repay the said sum and to avoid legal proceedings against her, had offered to secure ‑ the said sum by creating an equitable mortgage and then comes the most important part which has been underlined by me in the portion of the document reproduced above. This document is alleged to have been executed on 2nd July 1954 and clearly constituted the contract of mortgage between the parties, creating a first charge upon the property providing for payment of interest at 9 % and for costs which might be incurred to enforced the payment of the loan. It is plain that the mortgagee and her husband, the present plaintiff, were anxious to obtain a document from the defendant which would evidence a mortgage, create a first charge upon the property and provide for the method of repayment with interest at a certain rate. I cannot see as to how this document can be treated merely as a memorandum of deposit of title deeds. It clearly contains all the terms of the bargain between the parties, assuming that such a bargain took place. Construing the document as a whole I am clearly of the opinion that it comes within the mischief of section 49 of the Registration Act and not having been registered is not admissible in evidence.

13. The next question is as to what is the effect of the ending that the document. Exh. 5/1, is inadmissible in evidence for want of registration. The suit is based upon the mortgage and not upon the original consideration. And in view of my finding that the transaction of mortgage is contained in the document, Exh. 5/l which is inadmissible for want of registration, it must follow that the plaintiff's suit, as it is framed) must fail.

14. I shall now briefly deal with issues Nos. 1 &

2. The real question involved in these issues is whether the mortgage deed dated 2‑7‑54, Exh. 5/1, was without consideration and brought about by fraud on the part of the plaintiff. This is a strange case and though there is a large body of documentary evidence in support of the advance of loan from the original plaintiff to the defendant there are such compelling circum stances in the case that after most anxious and careful con sideration I have come to the conclusion that this story of the advance of loan of Rs. 60,000 by Mst. Begum and her husband to the defendant is one which cannot be accepted. I have repeatedly taken the documents and placed them against the circumstances of the case, to which I shall presently refer, and I have every time reached the same conclusion that the story of the loan of such a large sum of money is not worthy of acceptance. I shall now record my reasons for that conclusion. On behalf of the plaintiff have been produced 16 receipts executed by the defendant between 10th July 1952 and 8th February 1954. These contain the various items of loan advanced by Mst. Begum to the defendant, the total of which comes to Rs. 60,

000. The sums mentioned in these receipts vary from Rs. 150 to Rs. 8,

000. These are all unstamped receipts and were inadmissible in evidence under section 35 of the Stamp Act. Since, however, I they have been admitted into evidence that objection can no longer prevail. The question which immediately arises is whether Mst. 'Begum or her husband Abdul Karim bad the means to advance these loans aggregating to Rs. 60,000 to the defendant and whether the relation between them was really so intimate as to induce Mst. Begum and her husband to advance such large sums of money without any security and without any promise of profit from these transactions, because it is not the case of the plaintiff that when these sums were advanced they were liable to carry interest. Another striking thing is that Beg large sums of money have been paid regularly from month to month and sometimes with some gaps without any repayment whatever by the defendant over a period of 2 years. And the further question is whether the defendant really stood in need of these loans and as to what she was doing with these large sums of money which, it is alleged, Mst. Begum was freely advancing to her without any security. As to the relationship, between these two ladies Abdul Karim who, according to him, is a newspaper reporter; has stated that his wife Mst. Begum bad adopted one Muhammad as a son and he had invested some money in a business of motor spare‑parts which Muhammad was doing. It was this Muhammad who brought the defendant to the plaintiff's family and told them that she wanted to do some business in partnership with him. Abdul Karim further states that gradually his wife Mst. Begum became very friendly with the defendant who obtained loans from her from time to time and that even he paid money on behalf of his wife to the defendant in the absence of the former. Later on this Muhammad parted company from Mst. Begum and Abdul Karim and married the daughter of the defendant somewhere in 1955 admittedly against the wishes of Abdul Karim and Mst. Begum. Abdul Karim admitted that he had never been to the house of the defendant and it was only somewhere in 1952 or 1953 that they got acquainted with her. When asked as to for what purpose these loans were advanced he stated that the defendant had told them that she was indebted to some bank and had to pay taxes to the Municipal Corporation and motor taxes and she had also told them that her motor car was taken away by the police in connection with some smuggling case and she needed money for these purposes. It is not the case of the plaintiff that these moneys were advanced to the defendant to enable her to finance the Motor spare‑parts business of Muhammad, which upon the evidence it is clear, was of a very small value. Now, the bank loan, as is clear from a letter of the Mercantile Co‑operative Bank Ltd. Exh. 5/4, was of Rs, 8,000 and which had been borrowed by the defendant's husband in his life time and what had remained to be paid was only Rs. 2.943‑1‑

0. But even this loan remained unsatisfied as is expressly stated in the memorandum of mortgage, Exh. 5/

1. Municipal taxes and motor car taxes could not have been very much and the story that the defendant's car had been taken away by the police seems to be a very thin one. In any case these small liabilities did not warrant an advance of loan of Rs.60,000 paid from time to time within the period of 2 years without any attempt to recover. The defendant herself was not a pauper. The house rent from her building, which is the subject‑matter of the alleged mortgage, was Rs. 500 per month. If she did really go for loan from time to time to Mst. Begum she and her husband, even if they were willing to oblige her, were bound to enquire as to what she was doing with all this money. The small business which she was doing, as would appear from her evidence, did not require all this money. Abdul Karim has stated . that he was a reporter for several newspapers and from his statement that he knew Mr. Naqvi Magistrate because he was a reporter,, it would appeal that he was a reporter, it would appear that he was a reporter of cases in the Criminal Courts. Surely a shrewd man like him would not have allowed his wife to advance such large sums of money without any security to a person whom they hardly knew. Abdul Karim and Mst. Begum are refugees, while it appears from Exh. 5/4 that the defendant and her deceased husband, also named Abdul Karim, belonged to Karachi where they owned property before partition. The date of the mortgage by Abdul Karim of this property is 11th August 1945. Admittedly the mortgage property originally belonged to Abdul Karim and normally it would be inherited by his four daughters and the widow, namely, the defendant, in which case she would have a very small share. Now the title deed, which was deposited, consisted of .a so‑called deed of gift and a certified copy of the extract from the property register. All other documents must have been with the Bank, with which the property was mortgaged by Abdul Karim. Surely, if Abdul Karim and Mst.‑ Begum were advancing such large sums to the defendant they would have asked her to show them her title deed, and if they had shown it to some lawyer it would have been plain that what purports to be a gift deed was an inadmissible document, as it purports to convey the property and is unregistered. The title of the defendant to this property was, to say the least, far from being secure.

15. Let me now examine whether Mst. Begum had the means to advance to the defendant such a large sum of money. Abdul Karim in cross‑examination stated that he came to Karachi from Bombay in 1947 and had brought Rs. 20,000 in cash with him. He had not however deposited it in any bank. Pressed further he stated that he had deposited it with one Abdul Sattar Malani, a leading businessman of Karachi. No evidence was produced from the account books of Abdul Sattar Malani to, show that Abdul Karim had ever kept his money with him. Abdul Karim tried to get over this difficulty by saying that Abdul Sattar had died. About his wife he stated that she came to Karachi a little later and had brought with her Rs. 30,000 in cash and one thousand gold sovereigns; she had brought this money along with her but she did not open any account in any bank. He was then cross‑examined about his being a defaulter in respect of payment of house rent and he stated that he had always been paying rent to the landlord but after 1954 the rent was not being paid regularly because the defendant had taken away all his money. He was next asked whether he bad taken any loan from one Salamat Begum and the replies that he gave on this point are very revealing. 41e first said that he had never taken any loan from Mst. Salamat Begum in Delhi, but when pressed further he admitted that the money had been given by Mst. Salamat Begum to his wife in Delhi but that was not a loan but a trust. He further admitted that he used to pay Salamat &gum. Rs. 15 . per month in respect of this deposit but after 1954 the payment could not be continued as the present defendant had taken away all their (Abdul Karim and Ms,(. Begum's) money. The inference from these admissions is irresistible hat these two people were indebted to Mst. Salamat Begum from Delhi and all that they had been able to do was to pay her by small instalments of Rs. 15 which also they had stopped paying. It is also clear that Abdul Karim at least from 1954 was not in a position to pay even his house rent regularly. I cannot accept his statement that he was earning about Rs. 1,000 per month as a newspaper reporter, and the evidence on this point of his adopted son Muhammad that he was earning from Rs. 100 to )Zs. 150 is more worthy of credit. It would also appear that Mst. Begum during the relevant time which are covered by the receipts, Exhs. 5/7 to 5/22, had gone over to India. Conscious of this position Abdul Karim' took. the position that on several occasions he had advanced money on behalf of his wife and his wife used to instruct him by letters to make such advances.

16. All these circumstances lead to an irresistible conclusion that this story of the advance of loan either by Mst. Begum or by Abdul Karim to the defendant is not true. There is no doubt that the defendant has signed a large number of receipts, Exhs. 5/7 to 5/22, and an affidavit which was attested by Mr. Naqvi Magistrate who was also the signatory to the so‑called memorandum of deposit of title deeds. These at best are admissions. They are not conclusive proof of the advance of j the alleged loans and like any other admissions can be disproved. The burden of disproving it would be upon the defendant, and if it was merely her word I would have 'rejected it because she has not made very consistent statement but, as I have pointed out, the circumstances which negative the story of the loan are so compelling that I do not find it possible to reach a finding in favour of the plaintiff upon the basis of these documents. What mysterious relationship existed between Abdul Karim and Mst. Begum on the one hand and the defendant on the other has not come to surface because neither party has disclosed everything. It may however be noted that the defendant had no male member in her family to protect her interest and she is described as a Pardah Nashin lady in her written statement and she appeared in Burqa in Court. It is, therefore, likely that Abdul Karim and his wife were after the property which they thought this woman possessed and got her by some means or the other to execute papers and documents from time to time. I have come to this conclusion after mature deliberation and with considerable reluctance in view of the documentary evidence on record, but frankly I have found it impossible to swallow the story of the loan of Rs. 60,000 by the plaintiff to the defendant. My finding, there fore, is that the mortgage‑deed was without consideration. And if there was no consideration and the mortgage‑deed was still obtained it must follow that it was not a bona fide transaction and must have been obtained by practising a fraud upon the defendant.

17. In view of my findings t dismiss the plaintiff's suit with costs. K. M. A. Suit dismissed.