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Wednesday, September 26, 2018 09:51:01 AM
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Can a 3rd party be precluded for contesting a fraudulent deed?

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30th-Jun-2018       
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(From previous issue) :
After assessing the evidence, the High Court Division came to a finding that "the defendants had/have been in exclusive possession of the Ghar which is situated in another Bhiti and the plaintiffs were never in possession thereto." This finding in no way indicates the exclusive possession of the defendants in the 2.11 acres of the property gifted by Saijuddin. Hence the finding of exclusive possession of the defendants in the suit property is not sustainable.
13. Now let us turn to the substantive issue of locus standi of the plaintiffs to challenge the validity of the impugned heba-bil-ewaz deed. Simply put, the argument on behalf of the defendants, as also supported by Mr Abdul Wadud Bhuiya, is that Saijuddin, being the executant of the deed could not challenge its validity claiming its fraudulent registration as provided by Section 28(2)(a) of the Registration Act, and the plaintiffs being heirs of Saijuddin have no locus standi to challenge the validity of the deed on the same ground. Mr Bhuiya has additionally put forward the argument that under Section 115 of the Evidence Act the plaintiffs being in a representative capacity are estopped from denying the validity of the registration effected by Saijuddin, the executant of the deed.
14. Undoubtedly the deed of heba-bilewaz conlains 01 decimal of land of plot No. 120 within Khatian No. 80 of Kedarpur Mouja under Babugonj Police Station which is within the jurisdiction of Rahmatpur Sub-registry Office. It was the inclusion of this 01 decimal of land which enabled the executant to register the land at the Rahmatpur Sub-registry Office in spite of the fact that the remaining 2.10 acres of land detailed in the schedule of the deed is situated within the jurisdiction of Muladi Subregistry Office. It was alleged by the plaintiffs that Saijuddin in fact did not own the land of Khatian No. 80 of Kedarpur Mouja and hence the registration of the deed in Rahmatpur Subregistry Office was illegal being violative of S ection 28 of the Registration Act.
15. Section 28 of the Registration Act provides as follows:
"28. Place for registering documents relating to land (1) Save as in this Part otherwise provided, every document mentioned in 1. Section 17, sub-section (1), Clause (a), (b), (c), (d) and (e), Section 17, sub-section (2), and Section 18, in so far as such documents affects immoveable property shall be presented for registration in the office of a Sub-Registrar within whose sub-district the whole or major portion of the properly to which such document relates is situate:
Provided that where the major portion of such property is not situate within one sub-district the document shall be presented for registration in the office of the Sub-Registrar within whose sub-district any portion of such property is situate.
(2) Notwithstanding anything contained in sub-section(l),-
(a) after a document is registered, no party thereto shall be entitled to question the validity of its registration on the ground that the property which purported to give jurisdiction to the Sub-Registrar to register it either did not exist or was fictitious or insignificant or was not intended to be conveyed; and
 (b) a document the registration of which is secured by the inclusion of a nonexistent, fictitious or insignificant portion or item shall not in any manner affect the rights of a person who was not a party thereto and acquired rights in the property without notice of the transaction to which such document relates."
16. The registration clearly falls foul of the provisions of the Registration Act. It is undoubtedly a case of fraud on the Registration Act. The defendants did not seek to deny the fact that the land of Khatian No. 80 was not owned by Saijuddin. They took the stand that when any deed is registered in a sub-registry office which does not have the jurisdiction to register such deed, any party to that deed would not be entitled to cancel that deed. It was further contended that as the heirs of Saijuddin, the plaintiffs could not challenge the deed as provided by Section 28(2)(a) and (b).
17. The trial Court rejected the contention of the defendants on the ground that the plaintiffs or their predecessors were not party to the deed in question.
18. We may point out at this stage that the finding of the trial Court that since two of the beneficiaries of the heba deed were minors, the deed in their favour was void. This is clearly a misconception of law and was rightly reversed by the appellate court.
19. However, the live issue in this case is whether or not the heirs of the executant can challenge the deed which was registered by committing fraud on the statute. The plaintiffs are not party to the deed. The question is whether the heirs of the executant who registered the deed, and who stand to benefit from the fraud of the donor are contemplated by the provisions of Section 28(2)(a) and (b).
20. The learned Advocate for the plaintiff-appellants argued that the words of the statue are to be given their natural and ordinary meaning. In support of his contention he referred to the decision in Abdul Kader vs Secretary, Election Commission, 58 DLR (AD) 71. Hence, he submitted, the word 'party' to the deed would cover only the donor and donee since they are the persons who actively created the deed and would benefit from the execution and registration of the deed. Everyone else would be a third party as mentioned in Section 28(2)(b). He submitted that had it been the intention of the statute to bar any heir or representative of the donor from challenging the deed then it would have been specifically provided in the statute. He also submitted that the plaintiffs' and donor's interests are conflicting and hence the provisions of Section 28(2) are not applicable in the facts of the instant case.
21. The provision of law in fact reflects the common law principle that no man shall take advantage of his down wrong. Having illegally registered the deed, which at the time suited his purpose, the donor would not be permitted by law to renege from his liabilities under it by claiming that what he did was illegal or that the deed was invalid. In these circumstances the law cannot impinge upon the rights of any other person who did not play any part in the fraud. Moreover, the tenor of Section 28(2)(b) is that any third party who had no notice of the transaction is not precluded from challenging the validity of a deed to which he is not party and which was fraudulently registered.
22. The learned Advocate for the appellants referred us to the decision m Corporation of the City of Victoria vs Bishop of Vancouver Island, AIR 1921 PC 240, where it was held, "In the construction of statutes their words must be interpreted in their ordinary grammatical sense, unless there be something in the context, or in the object of the statute in which they occur, or in the circumstances with reference to which they are used, to show that they were used in a special sense."
23. We are of the view that if the wording of a statute is not in any way ambiguous, then the natural meaning is to be given to the words used. We find no difficulty in understanding the meaning of the statutory provision before lis. The intention of the statute is clearly to bar the parties to the fraudulently registered deed from challenging its validity when they themselves took the illegal path. However, the persons other than the actual parties are not precluded from challenging the fraudulently registered deed.
24. We find support for our view in the decision in Syed Kawsar Ali 'us Gahar Kazi reported in 37 DLR (AD) 177. In that case also a fictitious plot of land was included in a sale deed in order to give jurisdiction to and enable registration in a particular Sub-registry office. The trial Court found the deed to be fictitious and the appellate Court held that the deed which included non-existent property only to give jurisdiction to the particular Sub-registry office was void under Section 28 of the Registration Act. The High Court Division reversed the decision finding that there was no evidence that the transferee had any collusion with the vendor in including fictitious land and hence the transferee's right was not invalidated. This Division quoted the observation of the appellate court as follows:
"It is only the parties to document be bound by kabala containing non-existent or fictitious land only to attract the jurisdiction of a Sub Registration office within meaning of sub-clause (a) of clause (2) of Section 28 of the Registration Act. According to true interpretation of sub-clause (b) of Section 28 of Registration Act as it stands now after the amendment in 1962 parties not being parties to the kabala for a fictitious or non-existent land can reasonably show that kabala like Ext A is invalid for all intents and purposes."
25. After analysing several decisions of the Subcontinent, their lordships of this Division held,
"The expression "no party" means defendant Nos.1 and 2 but not defendant No. 3 because he has not been mentioned here. In other words it was the vendor and vendee of Ext A namely, defendant No.1 and defendant No.2 who are precluded from questioning the validity of registration on the ground that the property did not exist or was fictitious or insignificant or was not intended to be conveyed and the registration was invalid."
26. In the instant case the plaintiffs are not party to the deed in question and were totally unconnected at the time of the deed. Indeed, when it was created they were not the heirs of the donor. At the time of execution and registration of the deed the donor had a surviving wife and brothers who would have been his heirs. The plaintiffs were not even in contemplation of inheriting the property if the gift had not been made or the transaction had been invalidated at that time. They knew nothing of the heba-bil-ewaz. In hindsight it is seen that the fraudulent registration by inclusion of the fictitious land has affected the plaintiffs' interest. In our view the plaintiffs are third parties so far as the heba-bil-ewaz deed is concerned and their right to challenge the  deed is not barred under Section 28(2)(a) and has been protected by Section 28(2)(b).
In view of the above discussion, we are of the opinion that unless there is evidence that the heirs were in collusion with the donor in the fraud committed upon the statute, they would not be precluded from challenging the validity of the deed in question. In this case there is no such evidence. Accordingly, the appeal is allowed and the judgement and order of the High Court Division is set aside. There will be no order as to casts.

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