P L D 1966 (W (PLP)

WAHIDUDDIN AHMED, J.‑

This is a First Appeal from the judgment of the Additional District Judge, Karachi in suit No. 1384 of 1960 dated the 30th March 1963. By this judgment the learned Additional District Judge passed a decree for a sum of Rs. 16,000 with costs in favour of the respondents.

2. Briefly the facts leading to this appeal are that deceased Ramzan, plaintiff No. 2, filed the above‑mentioned suit alleging that they had advanced Rs. 16,000 to appellant No. 1 as constituted attorney of the rest of the appellants in connection with an agreement of a sale in respect of immovable property bearing No. 16 Survey Sheet LY 8, Karachi, which was entered into between the parties on 16th April 1959. It was alleged by the plaintiffs that appellant No. 1 had agreed to sell the above mentioned property to deceased Ramzan for Rs. 20,

000. Out of this amount they had paid Rs. 16,000 as earnest money. Under the terms of the agreement of sale the contract was to be completed within one year and in case the appellants were unable to perform the contract they were liable to refund the earnest money.

3. The suit was resisted on behalf of the appellants. Appellant No. 1 personally defended the suit. The other appellants contested separately. In defence it was pleaded that the agreement was obtained at the time when appellant No. 1 was under the influence of liquor. Appellants Nos. 2 to 9 pleaded that the appellant No. 1 had no authority to enter into an agreement of sale with deceased Ramzan. On behalf of the defendants Nos. 10 to 12, sons of deceased Sajjan, who are minors, it was pleaded that appellant No. 1 had no power to enter into such transaction on behalf of the minors. All the appellants and the other defendants in the suit denied con sideration. It was pleaded that the agreement of sale was a mortgage deed and created a charge on the above‑mentioned immovable property. Being unstamped and unregistered, no suit was maintainable on the basis of the above‑mentioned agreement of sale dated the 16th April 1959. Appellants 2 to 9 alleged that they were purdanashin ladies and were not bound by any power of attorney alleged to have been obtained from them.

4. At this stage it may be stated that respondent No. 1, Yakoob was joined in the suit on the allegation that deceased Ramzan had assigned his right of recovery of Rs. 16,000 to him. Deceased Ramzan, plaintiff' No. 2, died during the pendency of the suit. His legal representatives were brought on the record and Respondents Nos. 2 to 9, including Respondent No. 1, represented his interest in the appeal before us.

5. On the pleadings of the parties as many as 10 issues were framed. In view of the contention raised by learned counsel for the appellant it is not necessary to reproduce them in this judgment. In support of their case Respondents examined P. W. 1 Khalid Ahsanullah, Advocate and P. W. 2 Sahwan Ali. In defence the appellants produced D. W. 1 Moosa and D. W. 2 Kara. The learned Additional District Judge on the evidence produced by the parties gave a finding that the assignment in favour of the respondent No. 1 has not been established on the record. He found that appellant No. 1 had agreed to sell the above‑mentioned property by agreement dated the 16th April 1959 as attorney of appellants Nos. 2 to

9. He also held that deceased Ramzan had paid Rs. 16,000 as earnest money to appellant No. 1 for his own share in the property in dispute and as attorney of the other respondents. He gave no finding on the questions whether the agreement Exh. 2 was inadmissible in evidence, as it was not properly stamped and was unregistered. This was covered by issue No. 7 and the learned Judge has given the reason that he was not addressed by learned counsel on this particular issue. He further gave a finding that the sum of Rs. 16,000 was paid as earnest money for the purchase of the above‑mentioned immovable property. It was not a loan and the suit was not bit by the provisions of the Sind Money‑Lenders Act. The plea raised by defendants 10 to 12, who are minors, was not discussed because the Respondents had dropped their claim against them and the suit against them has been dismissed. The finding of the Additional District Judge is that appellant No. 1 Moosa had received a sum of Rs. 16,000 on behalf of the appellants under a valid power of attorney executed by them and they are liable for the return of the said amount. In view of this finding the learned subordinate Court decreed the plaintiff's suit against appellants 1 to 9 in the sum of Rs, 16,000 with costs. The appellant has challenged this judgment and decree in this First Appeal.

6. In support of the appeal, Mr. M. I. Lakhani, learned counsel for the appellants, has not challenged the finding of the learned Additional District Judge on any other points except those which will be presently discussed by us. Mr. Lakhani has attacked the judgment only on two points: firstly, that Exh. 2, agreement of sale, was an inadmissible document. It purports to be a deed of mortgage and charge and since it is neither properly stamped nor registered no suit could be filed on its basis. Secondly, the respondent has not been able to prove that any consideration passed in respect of the alleged sale. After hearing learned counsel for the parties, we are satisfied that none of the points urged by the appellant's counsel has any force. We will discuss the points raised by him separately.

7. Mr. Lakhani contended that Exh. 2, agreement of sale, dated the 16th April 1959, is a deed of mortgage and charge and, therefore it required to be stamped under Article 40 (b) of the Stamp Act. In order to support his argument, learned counsel referred to clauses 4, 5 and 7 of the agreement of sale, Exh.

2. In clause 4 it is provided that the sum of Rs. 16,000 paid as earnest and advance payment of the price shall so long as the conveyance is not completed be deemed to be a charge on the above‑mentioned property. It further provided that the vendors had this day deposited an extract from the City Deputy Collector in respect of the property in dispute as and by way of deposit of title deed creating an equitable charge on it and the amount to all intents and purposes shall be a charge thereon. It further recites that in furtherance thereof the following further documents are also deposited as and by way of equitable mortgage for securing the payment of the said sum. In clause 5 it is provided that in case the vendors on or before the expiry of one year notify and pay back the amount of Rs. 16,000 with interest at 8 per eent. per annum, the venders shall have the liberty to terminate the charge and equitable mortgage. In addition clause 7 itself provided that during the period of one year from the agreement the property shall be deemed to have vested in the purchaser who shall have the first charge and lien upon the property in dispute and all transactions, if any, sought to be made by the vendors shall be subject to the first charge of the amount in question with interest. In view of these clauses learned counsel contended that the document in question is in the nature of a mortgage deed and, therefore, it should have been stamped under Article 40 (b) of the Stamp Act. It is only a mortgage deed which is chargeable with a stamp duty under Article

40. Under the Stamp Act `mortgage deed' has been defined in section 17 which is in the following terms "17. `Mortgage‑deed' includes every instrument whereby, for the purpose of securing money advanced, or to be advanced, by way of loan, or an existing or future debt, or the perfor mance of an engagement, one person transfers, or creates, to, or in favour of, another, a right over or in respect of specified property." It is to be noticed that the document in question is not of that nature. Appellant No. 1, under the above‑mentioned agreement, agreed only to sell the property in dispute on certain terms and conditions. In the document itself it is stated that as long as the contract is not performed, the amount advanced as earnest money will be treated as charge on the property agreed to be sold. Even if this stipulation had not been made in the document, any amount paid in advance towards the agreement of sale is a charge under section 55, subsection 6 (b) of the Transfer of Property Act. It is, therefore, quite clear that any term of this nature could not in the least create any new right in favour of deceased Ramzan. Under the above‑mentioned law any amount advanced by him towards the sale price was a charge. It seems to us that by incorporating such a term, an agreement of sale cannot be considered to be an instrument whereby, for the purposes of securing money advanced or to be advanced by way or loan or an existing or future debt, or the performance of an engagement, one person transfers, or creates, to, or in favour of, another, a right over or in respect of specified property. The contention of learned counsel, therefore, that the document in question was required to be stamped as mortgage‑deed because it' stipulated to create a charge is not well founded and is repelled.

8. Similarly, the contention of learned counsel appearing for the appellants that because it created an equitable mortgage right by deposit of title deeds it was liable to be stamped under Article 40 has no substance. Under Article 40(b) only that mortgage deed is liable to stamp duty which is not an agreement relating to deposit of title deeds. In the present case, the mortgage in question at best is an agreement relating to deposit of title deeds and, therefore, Article 40 cannot be attracted to it. The contention of learned counsel, therefore, that for this reason the document in question was insufficiently stamped cannot be accepted as sound.

9. The difficulty, however, arises on account of the fact that the document is not registered under the Registration Act. it ,was rightly contended by learned counsel appearing for the appellants that any document creating a charge on any immovable property was compulsorily registerable under section 17 of the Registration Act. In this connection learned counsel relied on a decision of the Supreme Court of Pakistan is the case of Abdur Razzak Hawaldar v. Sh. Muhammad Shafi (PLD 1962 SC 134). In that case their Lordships held that an instrument creating a right to immovable: property in the nature of charge required compulsory registration. If the decision of the question depended on the fact that the document Exh. 2 also required registration because it evidenced an equitable mortgage by deposit of title deeds, the contention of learned counsel for the appellants that no suit could be filed on it as it was inadmissible in evidence was likely to create much difficulty in the way of the respondents.

10. It is, however, not necessary for us to decide this aspect of the question because the respondents had not claimed any relief in respect of the immovable property which appellant No. 1 on his own behalf and on behalf of appellants 2 to 9 agreed to sell to deceased Ramzan for Rs. 20,

000. The Respondents did not claim any relief in respect of the property in dispute. They have not claimed any relief for creating a charge on the property in dispute nor have they claimed any mortgage decree against C the appellants in respect of that property. The respondent filed a simple suit for the recovery of the refund of the earnest money on the ground that the appellants have committed breach of the contract and did not perform the contract as agreed upon between the parties. In such circumstances Exh. 2 cannot be said to be the basis of the suit for the recovery of the amount in dispute. At best it is used for collateral purposes, namely,) to prove that a sum of Rs. 16,000 was paid by deceased Ramzan to appellant No. 1 as earnest money towards the said agreement. In view of this the learned Additional District Judge was fully justified in admitting this document in evidence to prove the collateral purposes. This is permissible under section 49 of the Registration Act as it stood unamended in April 1962, when the document in question was tendered in evidence before the lower Court. In this connection it will be noticed that the question involved in this matter has arisen in a number of cases in the civil disputes. In Muhammad Kavsim v. Ruqia Begum (16 Lab. 1105) A gave his son in marriage to B and agreed to pay Rs. 10,030 for dower. He then executed a deed of transfer of an immovable property to B in lieu of dower, but refused to register the deed. B sued A to recover the dower. It was held that though the deed was unregistered, it was admissible in evidence to prove the amount of dower and A's promise to pay the same. Similarly in Ardesir v. Sardar Ali Khan ((1909) 33 Bom. 610) it was held by the Bombay High Court that where a lessee has deposited money that his lessor has demanded as security for the due performance of the conditions of the lease, and the lease is subsequently determined by the lessor, the lease though unregistered is admissible in evidence in a suit by the lessee to recover the deposit to prove the fact that the money was deposited and the lessee had right to recover it. In view of these decisions we are satisfied that the learned Subordinate Court was perfectly justified in relying on document to consider the question whether the amount in dispute was paid as earnest money to the appellants towards the alleged sale. It may be further noticed that the law on this point in Pakistan has considerably changed. Section 49 has now been amended and the provision in the said section which provided that no document which requires registration will be admissible in evidence has now been taken away. Under the amended section 49 the only penalty is that no document required to be registered shall operate to create, declare, transfer, limit or extinguish whether in present or in future any right, title or interest in any immovable property. The former effect of non‑registration that it could not be received as evidence of any, transaction affecting such property is no longer the law of this country.

10. It is not disputed that the document Exh. 2 was executed by appellant No. 1 on his own behalf or on behalf of the rest of the appellants. It is also not challenged in this appeal that appellant No. 1 held power of attorney on behalf of the rest of the appellants and was competent to enter into the alleged transaction of sale. It is, however, urged by Mr. Lakhani that the respondent has not proved consideration. Learned counsel contended that Yakoob in whose presence it is alleged the amount is dispute was paid to appellant No. 1 has not been produced in evidence and, therefore, an adverse presumption should have been raised against the respondents. In this connection he referred us to the statement of P. W. 1 Khalid Ahsanullah (Exh. No. 1) who stated in his deposition that "Actually Ramzan took out the money and passed it on to Yakoob, plaintiff No. 1, who counted it. Yakoob then gave the money to Moosa." The contention of learned counsel therefore that Yakoob was present at the time of the payment of Rs. 16,000 does find support from the statement of Mr. Khalid Ahsanullah. Had there been no other evidence in support of the payment of Rs. 16,000 the failure to examine Yakoob might have had a fatal effect on the claim of the respondents. But Khalid Ahsanullah, who is an Advocate of this Court, has stated on oath that a sum of Rs. 16,000 was paid in his presence to appellant No. 1 in connection of the alleged sale. The learned subordinate Court has accepted his statement as good evidence and it is difficult for us to differ from the view taken by him in this respect. There is nothing in the evidence of this witness to show that he is an unreliable witness or was in any way partial to the respondents. The document Exh. 2 was prepared in the office of the witness and, therefore, it cannot be said that he is a chance witness or his presence on the occasion when the amount in question was paid to appellant No. 1 is doubtful. Besides, P. W. 2 Sanwar Ali, who is an attesting witness to Exh. 2, has also stated in his deposition that P. W. 1 was present at the time when the document, Exh. 2 was executed. In the circum stances of the present case, therefore, we are satisfied that the respondents had satisfactorily proved the payment of Rs. 16,000 to appellant No.

1. If the appellants thought that Yakoob, Respondent No. 1, would not support their case on this point it was open to them to apply to the Court to permit them to cross‑examine him. No such attempt was made in the present case. In these circumstances, we are of the opinion that the contention of the appellant that the consideration has not been proved in this case has no substance and was rightly rejected by the learned subordinate Court.

11. No other point was urged by learned counsel. After hearing learned counsel for the parties, we are satisfied that the learned Subordinate Court on the evidence produced in the case was justified in decreeing the suit in favour of the respondents.

12. Before parting with this case we may dispose of the contention of Mr. Tyabji that in exercise of the power of this Court under Order XLI, rule 33, C. P. C. we should modify the decree passed by the learned Subordinate Court so that its benefit may be exclusively enjoyed by the Respondent No.

1. Mr. Tyabji contended that deceased Ramzan alleged in the plaint that he had assigned the debt in dispute to Respondent No.

1. He further contended that all the respondents in the trial Court had consented that the decree may be granted only to respondent No.

1. In this connection it will be noticed that the learned Subordinate Court decided Issue No. 1, namely, "Is the plaintiff No. 1 the assignee of plaintiff No. 2" against Respondent No. 1 on the ground that he had not come forward in the witness box to depose that the deceased made a gift of the debt in question to him and ha accepted it. The consideration which weighed with the learned Subordinate Court in not accepting the plea is quite weighty. If respondent Yakoob wanted to rely on the gift made by deceased Ramzan in his favour in respect of the debt in dispute it was incumbent on him to prove this fact by deposing in the witness box that he had accepted the gift. No such evidence was produced in the trial Court. In the absence of any such evidence the learned Subordinate Court was justified in holding that the alleged gift had not been proved. In these circumstances we are not inclined to modify the deree passed in the suit for giving its exclusive benefit to Yakoob. Moreover, the decree is also in favour of some of the minor appellants and any concession on their behalf cannot be considered as valid in law.

13. In the result, we would hold that there is no force in the appeal which is dismissed with costs. K.B.A. Appeal dismissed.