# PRATIMA CHOWDHURY v. KALPANA MUKHERJEE & ANR

- **Citation:** [2014] 2 S.C.R. 656
- **Court:** Supreme Court of India
- **Decided:** 2014-02-10
- **Case number:** Civil Appeal No. 1938 of 2014
- **Bench:** P. Sathasivam, Jagdish Singh Khehar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/pratima-chowdhury-v-kalpana-mukherjee-anr-29859
- **Pages:** 80

## Headnote

TRANSFER OF PROPERTY ACT, 1882:
Housing Society - Transfer of membership/flat - Validity
of - Flat given on rent to the son of the respondent - Letters
written by appellant to Society for transferring the said flat in
favour of respondent on account of close relationship between
0
them - Transfer was without consideration - Arbitrator held the
letters of transfer invalid - Cooperative Tribunal and High
Court held that approach of arbitrator was erroneous - Held:
Respondent was mother-in-law of niece of appellant -
Therefore factually the expression of close relationship
depicted in the letters was false - As regards transfer without
E consideration, respondent herself gave statement to the effect
that appellant had transferred the flat for consideration of
Rs.4.29 lacs which was in form of shares belonging to the son
of the respondent - However, on the date of execution of
transfer or even when board resolution was passed, the son
F of the respondent did not have any shares in his name said
to have been transferred to appellant as consideration of the
flat - Therefore, all the ingredients of the letters were shrouded
in suspicious circumstances - The stance of appellant
regarding transfer of shares was that same was return of loan
G extended by her to son of the respondent for business venture
- This factual position was overlooked by Cooperative Tribunal
and High Court - Arbitrator held that the appellant was in
Bombay and not in Calcutta when these letters were written -
Said finding was recorded on the basis of 3 witnesses
H
656
PRATI MA CHOWDHURY v. KALPANA MUKHERJEE & 657
ANR.
produced on behalf of appellant before the arbitrator -
A
Cooperative Tribunal overlooked the statement of witnesses
merely because notary was an Advocate - Conclusion of
Cooperative Tribunal and High Court that the documents were
executed in Calcutta was therefore basec pn no evidence -
Further, respondent continued to pay rent into the account of B
appellant - Accordingly, arbitrator rightly inferred that even to
the knowledge of respondent, flat was not actually transferred
to her name.
Housing Society - Transfer of membership/flat -
C
Revocation of - Withdrawal letter revoking letters of transfer
was sent by appellant before the transfer of membership/flat
had attained finality - Still, Society did not consider the
withdrawal letter - Acceptance or rejection on merits is another
matter, but non-consideration clearly invalidated the
resolution of transfer passed by society.
D
Transfer of membership/flat - Validity of - Fiduciary
relation - Held: When parties are in fiduciary relationship, the
manner of examining the validity of a transaction specifically
when there is no reciprocal consideration has to be based on
E
parameters which are different from those applicable to an
ordinary case.
Transfer of membership/flat without consideration -
Relationship of faith, trust and confidence - Letters written by
appellant to Housing Society for transferring her flat to the
name of the respondent - Held: There was no justification for
F
the appellant to transfer her flat to respondent free of cost
specially when she has no direct intimate relationship with
respondent - Son of respondent was married to niece of
appellant and so he was in domineering position - He enjoyed
G
trust and confidence of appellant which was apparent from the
fact that thejoint account of appellant with the son of the
respondent was operated by him exclusively and drafting of
the letters of transfer of flat was done by him on behalf of
appellant - In such fact situation, the onus of substantiating
H
658
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A the validity and genuineness of the transfer of flat by the
appellant rested squarely on the shoulders of the respondent
which she miserably failed to discharge.
CODE OF CIVIL PROCEDURE, 1908: Pleadings -
8
Rejoinder - Non consideration of facts stated in the rejoinder
- Effect of - Respondent-defendant in written replies adopted
stand contrar

## Text

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A
B
c
[2014] 2 S.C.R. 656
PRATIMA CHOWDHURY
v.
KALPANA MUKHERJEE & ANR.
(Civil Appeal No. 1938 of 2014)
FEBRUARY 10, 2014
[P. SATHASIVAM, CJI. AND
JAGDISH SINGH KHEHAR, JJ.]
TRANSFER OF PROPERTY ACT, 1882:
Housing Society - Transfer of membership/flat - Validity
of - Flat given on rent to the son of the respondent - Letters
written by appellant to Society for transferring the said flat in
favour of respondent on account of close relationship between
0
them - Transfer was without consideration - Arbitrator held the
letters of transfer invalid - Cooperative Tribunal and High
Court held that approach of arbitrator was erroneous - Held:
Respondent was mother-in-law of niece of appellant -
Therefore factually the expression of close relationship
depicted in the letters was false - As regards transfer without
E consideration, respondent herself gave statement to the effect
that appellant had transferred the flat for consideration of
Rs.4.29 lacs which was in form of shares belonging to the son
of the respondent - However, on the date of execution of
transfer or even when board resolution was passed, the son
F of the respondent did not have any shares in his name said
to have been transferred to appellant as consideration of the
flat - Therefore, all the ingredients of the letters were shrouded
in suspicious circumstances - The stance of appellant
regarding transfer of shares was that same was return of loan
G extended by her to son of the respondent for business venture
- This factual position was overlooked by Cooperative Tribunal
and High Court - Arbitrator held that the appellant was in
Bombay and not in Calcutta when these letters were written -
Said finding was recorded on the basis of 3 witnesses
H
656
PRATI MA CHOWDHURY v. KALPANA MUKHERJEE & 657
ANR.
produced on behalf of appellant before the arbitrator -
A
Cooperative Tribunal overlooked the statement of witnesses
merely because notary was an Advocate - Conclusion of
Cooperative Tribunal and High Court that the documents were
executed in Calcutta was therefore basec pn no evidence -
Further, respondent continued to pay rent into the account of B
appellant - Accordingly, arbitrator rightly inferred that even to
the knowledge of respondent, flat was not actually transferred
to her name.
Housing Society - Transfer of membership/flat -
C
Revocation of - Withdrawal letter revoking letters of transfer
was sent by appellant before the transfer of membership/flat
had attained finality - Still, Society did not consider the
withdrawal letter - Acceptance or rejection on merits is another
matter, but non-consideration clearly invalidated the
resolution of transfer passed by society.
D
Transfer of membership/flat - Validity of - Fiduciary
relation - Held: When parties are in fiduciary relationship, the
manner of examining the validity of a transaction specifically
when there is no reciprocal consideration has to be based on
E
parameters which are different from those applicable to an
ordinary case.
Transfer of membership/flat without consideration -
Relationship of faith, trust and confidence - Letters written by
appellant to Housing Society for transferring her flat to the
name of the respondent - Held: There was no justification for
F
the appellant to transfer her flat to respondent free of cost
specially when she has no direct intimate relationship with
respondent - Son of respondent was married to niece of
appellant and so he was in domineering position - He enjoyed
G
trust and confidence of appellant which was apparent from the
fact that thejoint account of appellant with the son of the
respondent was operated by him exclusively and drafting of
the letters of transfer of flat was done by him on behalf of
appellant - In such fact situation, the onus of substantiating
H
658
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A the validity and genuineness of the transfer of flat by the
appellant rested squarely on the shoulders of the respondent
which she miserably failed to discharge.
CODE OF CIVIL PROCEDURE, 1908: Pleadings -
8
Rejoinder - Non consideration of facts stated in the rejoinder
- Effect of - Respondent-defendant in written replies adopted
stand contrary to documents relied upon by rival parties -
Number of documents not mentioned by appellant-plaintiff in
the dispute case relied upon by respondent - Held: Arbitrator
recorded his findings in the award not only on the pleadings
C including rejoinder but also on the basis of evidence led in
support of said pie ·dings - Thus, arbtirator acted in
accordance with law and therefore exclusion from
consideration of factual position asserted by appellant in her
rejoinder by the Cooperative Trwunal and High Court was
D wholly unjustified.
E
DOCTRINES/PRINCIPLES:
Principle of estoppel - Applicability of - Discussed.
Principle of justice and equity and doctrine of fairness -
Applicability of.
Evidence Act, 1872: s. f 15 - Estoppel - Salient precondition for invoking rule of estoppel - Discussed - In the
F instant case, the first party made no representation, the
second party did not accept any representation and did not
act in any manner nor second party altered its position -
Therefore, tire question whether the restoration of the original
position would be iniquitous or unfair did not arise.
G
NOTARY ACT, s.8 - Notarization of document - Non
issuance of notarial certificate - Held: In the absence of
i~suance of certificate, notarization of document becomes
suspicious.
H
,The appellant owned a flat in a Cooperative Society.
PRATIMA CHOWDHURY v. KALPANA MUKHERJEE
659
&ANR.
One PM, the son of the responent and the son-in-law of A
the appellant's sister occupied flat 50 owned by the
appellant. PM was employed with CP Ltd. On 9.3.1992, CP
Ltd. confirmed having taken flat .in question on lease and
licence for 3 years for the residence of PM. The rent was
paid in the joint acount of the appellant and PM.
B
On 29.6.1992, the appellant requested the Society to
transfer the said flat to the respondent and intimated that
all municipal taxes would be paid by the respondent. The
appellant then addressed letter dated 11.11.1992 to the
C
Secretary of the Society reiterating her request made in
letter dated 29.6.1992 wherein she again expressed
dearly'that the transfer being sought by her, was without
any monetary consideration. It was pointed out in the
said letter that the formal request for the transfer was
made in order to comply with the rules regulating such
D
transfer, and also, to avoid future complications.
Consequently, the appellant executed an agreement
dated 13.11.1992, transferring her right, title and interest
in the said flat to the respondent. The Secretary of the
Society wrote letter dated 10.3.1993 to the Deputy
E
Registrar, Co-operative Societies for seeking the approval
for the transfer of flat to the name of the respondent.
Meanwhile PM was transferred to Bombay and on
19.10.1993, CP Ltd. terminated the agreement executed
by it with the appellant. On 21.10.1993, the respondent on
F
her own account deposited rent in the bank account of
the appellant. On 16.12.1994, 500 shares standing in the
joint names of PM and his wife SM were transferred to the
name of the appellant.
The appellant wrote a letter dated 28.2.1995 to the
Secretary of the Society, that she had not received any
reply to her letter dated 11.11.1992. She also informed the
Secretary of the Society that she had decided to return
G
to Calcutta permanently and, therefore, her request for
H
660
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A transfer of her membership to the name of the respondent
be treated as withdrawn. The appellant's case was that
the Society never responded to her letter dated 28.2.1995
and the said letter was never forwarded by the Society
to the Department of Co-operative Societies.
B
Still, the Society approached the Deputy Registrar,
Co-operative Societies, seeking approval for the
admission of the respondent as a member of the Society
which was conditionally approved on 13.3.1995. On
13.3.1995 itself the shares of the appellant were
C transferred to the name of the respondent. On 22.3.1995,
the appellant addressed a letter to the Deputy Registrar,
Co-operative Societies requesting to direct the Society to
withdraw the offer of transfer of her membership to the
respondent. It was also requested, that the application
D made by the respondent for transfer of share certificates
in her name, be not approved. The appellant wrote
another letter dated 28.3.1995 to the Secretary of the
Society requesting that transfer of membership in favour.
of the respondent be treated as withdrawn. The Society
E convened a meeting on 2.4.1995 wherein the Board of
Directors resolved, that it had no legal competence to
restore the membership of the Society, as also, the
retransfer of the ownership of the flat no. SD, to the
appellant. Having so resolved, the Secretary of the
F Society forwarded a copy of the resolution dated
2.4.1995, to the appellant. The Board of Directors of the
Society approved the transfer of flat to the name of the
respondent. In addition to the said flat, the ownership of
the appellant also comprised of a covered garage space,
G on the ground floor. The same were not mentioned in the
clearances dated 14.2.1993 {by the Board of Directors of
the ·Society) and 13.3.1995 (by the Deputy Registrar, Coo pe ra tive Societies). Consequently based on the
agreement dated 25.4.1995 between the respondent and
H the Society, the said garage space was also subsequently
PRATIMA CHOWDHURY v. KALPANA MUKHERJEE &661
ANR.
transferred to the name of the respondent.
A
On 16.4.1995, the appellant challenged the validity of
the Board. of Directors' Resolution dated 2.4.1995. The
Deputy Registrar, Co-operative Societies referring to the
appellant's letter dated 28.2.1995 (wherein appellant had 8
withdrawn her request for transfer of membership in
favour of respondent), wrote a letter dated 31.5.1995 to
the Secretary of the Society highlighting the fact that, the
Society had not brought the letter dated 28.2.1995 to the
notice of Deputy Registrar, Co-operative Societies, at the C
time of seeking approval of the Co-operative Department
The Secretary of the Society was accordingly directed, to
take a decision on the matter, and to forward the same
to the Deputy Registrar, Co-operative Societies.
Since, the appellant was not communicated any D
determination, by the concerned authorities, she
addressed a notice on 9.9.1995, calling upon the
Secretary of the Society, to deliver the possession of the
flat along with the share certificates. The Society denied
all the allegations made by the appellant against the E
Society (contained in the notice). On the claim of
retransfer of the shares and flat made by the appellant,
the Society responded by asserting, that the shares had
been transferred to the name of the respondent, and on
the basis thereof flat no. 5D also had been transferred in
F
her name, thereupon, the Society did not have any legal
authority to restore/retransfer the same to the name of the
petitioner. On 19.12.1995, the Deputy Registrar, Cooperative Societies also informed the appellant, that the
transfer of her shares and flat in favour of the respondent G
had been completed, and since the Society had resolved
on 2.4.1995 that it had no legal competence to cancel the
same, nothing could be done in the matter.
The appellant filed Dispute Case which was
adjudicated upon by the Arbitrator. The Arbitrator held H
662
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A that agreement dt. 13.11.92 was invalid, void and
incomplete and directed the Society to ensure and
conform that the appellant gets the possession of the flat
with garage space with immediate effect and issue share
certificate in her name immediately. On· appeal, the CoB operative Tribunal held that the entire approach of the
Arbitrator was erroneous, as the Arbitrator had treated the
appellant as a pardanashin 1.ady. The High Court
dismissed the appeal. The instant appeal was filed
challenging the order of the High Court.
c
Allowing the appeal, the Court
HELD: 1. The Co-operative Tribunal, as also, the High
Court excluded from consideration, the factual position
expressed in the rejoinder filed by the appellant (before
D the Arbitrator). In excluding the said factual position, the
Co-operative Tribunal and the High Court did not rely on
any provision of law nor was any reliance placed on any
principle accepted and recognized in legal jurisprudence.
It is not a matter of dispute that after the respondent and
E the Society were permitted to file written replies before
the Arbitrator, the rejoinder filed thereto on behalf of
appellant, was permitted to be taken on record. It is not
in contention, that in the written replies filed before the
Arbitrator, the respondent had adopted inter alia the
F
stance that consideration was paid to appellant in lieu of
the transfer of flat to her name, even though the
documents relied upon by the rival parties, expressed
otherwise. A number of documents not mentioned in the
Dispute Case filed by appellant were also relied upon by
G the respondent. Pleadings between the parties could be
considered as complete, only after appellant was
permitted to file a rejoinder (in case she desired to do so).
She actually filed a rejoinder which was taken on record
by the Arbitrator. Both parties were permitted to lead
evidence, not only on the factual position emerging from
H
PRATIMA CHOWDHURY v. KALPANA MUKHERJEE 663
&ANR.
the complaint filed by appellant and the written replies A
filed in response thereto (by respondent and the Society),
but also, the factual position highlighted by appellant in
her rejoinder affidavit. It is, therefore, not on the basis of
the pleadings of the parties, but also on the basis of the
evidence led in support of the said pleadings, that the B
Arbitrator had recorded his findings in his award. The
Arbitrator had, therefore, acted in accordance with law,
and therefore the exclusion from consideration, of the
factual position asserted by appellant in her rejoinder, by
the Co-operative Tribunal and the High Court was wholly c
unjustified. The factual narration by appellant could not
be excluded from consideration, while adjudicating upon
the rival claims between appellant and the respondent.
[Para 26] [712-G-H; 713-A-F]
2. The Co-operative Tribunal in its order had invoked D
the principle of estoppel, postulated in Section 115 of the
Indian Evidence Act. The High Court affirmed the
conclusions drawn by the Co-operative Tribunal. In
addition to the said principle, the High Court invoked the
principles of equity and fairness. The rule of estoppel is E
a doctrine based on fairness. A perusal of the provision
reveals four salient pre conditions before invoking the
rule of estoppel. Firstly, one party should make a factual
representation to the other party. Secondly, the other
party should accept and rely upon the said factual
F
representation. Thirdly, having relied on the said factual
representation, the second party should alter his
position. Fourthly, the instant altering of position, should
be such, that it would be iniquitous to require him to
revert back to the original position. Therefore, the G
doctrine of estoppel would apply only when, based on a
representation by the first party, the second party alters
his position, in such manner, that it would be unfair to
restore the initial position. None of the ingredients of
principle of estoppel contained in Section 115 of the H
664
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A
Indian Evidence Act, can be stated to have been
satisfied, in the facts and circumstances of this case.
Herein, the first party has made no representation. The
second party has therefore not accepted any
representation made to her. Furthermore, the second
B
party has not acted in any manner, nor has the second
party altered its position. Therefore, the question whether
the restoration of the original position would be iniquitous
or unfair does not arise at all. In the facts presented by
the rival parties, especially in the background of the order
c passed by the Arbitrator, that no consideration had
passed in lieu of the transfer of the flat, and especially in
the background of the factual finding recorded by the Cooperative Tribunal and the High Court, that passing of
consideration in the present controversy was
0
inconsequential, the principle of estoppel relied upon
could not have been invoked, to the detriment of the
appellant. In view of this, the determination by the Cooperative Tribunal, as also the High Court, in having relied
on the principle of estoppel, and thereby, excluding the
pleas/defences raised by the appellant to support her
E
claim is set aside. [para 27] [714-A, H; 715-A-G; 717-E]
Kasinka Trading vs. Union of India, (1995) 1 SCC 274;
Monnet /spat & Energy Ltd. vs. Union of India & Ors., (2012)
11 SCC 1; H.S. Basavaraj (D) by his LRs. & Anr. Vs. Canara
F
Bank & Ors., (2010) 12 SCC 458 - relied on.
3.1. Admittedly, the reason for transferring the flat
indicated in the letters dated 11.11.1992 and 13.11.1992
was on account of the close relationship between the
G appellant and the respondent. As a matter of fact, there
was no close relationship between appellant and the
respondent. The appellant was indicated to have been
living in Bombay and never visiting Calcutta. The
respondent was a resident of Calcutta, who was in
employment at Calcutta, and had started to reside with
H
PRATIMA CHOWDHURY v. KALPANA MUKHERJEE 665
& ANR.
her son PM, after he moved to Calcutta alongwith his wife
A
SM. There was no direct relationship between the
appellant and the respondent. Appellant's niece SM was
married to PM, son of the respondent. The only
relationship that can be assumed, is of aunt and niece,
between the appellant and SM. If on account of love and
affection, for her niece, the appellant desired to transfer
B
flat which she had purchased for a consideration of Rs.4
lakhs, she would have done so by transferring it to the
name of her niece SM. Affinity to SM, and the love,
affection and welfare of SM would not extend to a gesture c
of the nature under reference, i.e., by way of transfer of
immovable property, of substantial value, without
consideration, to the mother-in-law of SM. Therefore,
factually the expression of close relationship between the
appellant and respondent depicted in letters dated
0
11.11.1992 and 13.11.1992 are on the face of it, false and
incorrect. It is, therefore, improper for the adjudicating
authorities to have accepted the factum of close
relationship of the parties, in so far as, the transfer of flat
no. 50 was concerned. Further, as per letters dated
11.11.1992 and 13.11.1992, Flat no. 50 was sought to be
transferred by the appellant to the respondent, without
consideration. The said factual position cannot be
accepted on account of the statement of the respondent
herself. In the written reply filed before the Arbitrator, the
respondent took the express stance, that the appellant
had transferred flat no. 50 to her name, by accepting a
consideration of Rs.4,29,000/-. She further asserted, that
the said consideration had passed from the respondent
to the appellant through PM who had transferred shares
E
F
in his name valued at Rs.4,29,000/-, to the name of the
G
appellant. Per se therefore, even respondent denied the
factual position indicated in the letters. [para 28(i), (ii)]
[717-H; 718-A-H; 719-A-B]
3.2. The letters dated 11.11.1992 and 13.11.1992
H
666
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A expressly recorded, that the factual position narrated in
the letters was on account of "compliance with the rules
regulating such transfer, and also, for avoiding future
complications". In view of the factual position, it is
apparent, that false facts were being recorded for
B compliance with the rules and regulations, as also, for
avoiding future complications. One would have
appreciated the recording of consideration in lieu of the
transfer of property from the name of appellant to that of
the respondent, to avoid future complications, rather than
c withholding the same. It is clearly not understandable,
what kind of complications were being avoided.
Expressing the factual position in the letters under
reference, makes the whole transaction suspicious,
mistrustful and possibly fraudulent too. In the absence
0 of any relationship, the party benefiting from the letters
dated 11.11.1992 and 13.11.1992, would have
successfully avoided all complications merely by
incorporating consideration, which was to pass from the
respondent to the transferee appellant. If consideration
E was to pass, and had actually passed, it is difficult to
understand why the parties would say, that the
transaction did not involve passing of consideration. It is,
therefore, clear that all the ingredients of letter dated
11.11.1992 and 13.11.1992 were shrouded in suspicious
circumstances. It was not legitimately open to the parties
F to record in the letters under reference, that flat no. 50
was being gifted by the appellant to the respondent, on
account of lack of proximity between the parties. The
transfer of the said property by one to the other, by way
of gift, would obviously have been subject to judicial
G interference, as the same would at least prima facie, give
the impression of dubiety. It was, therefore, that the
respondent hastened to adopt a different factual position
in her written reply before the Arbitrator. In the written
statement filed by the respondent (before the Arbitrator)
H the stand adopted by her was, that a consideration of
PRATIMA CHOWDHURY v. KALPANA MUKHERJEE & 667
ANR.
Rs.4,29,000/- had passed from her to the appellant, by
A
way of transfer of shares (standing in the name of her
son, PM) to the name of the appellant. The Board of
Directors of the Society, in its meeting held on 14.2.1993,
resolved to accept the resignation of the appellant and
accept the membership of the respondent in her place.
B
On the date of execution of the documents under
reference, as also on the date of passing of the resolution
by the Board of Directors of the Society, PM did not have
any shares in his name. The shares which PM acquired,
and which respondent claimed to have been transferred c
in lieu of consideration (to the name of the appellant),
were shown to have been acquired on or after 8.9.1993.
It is, therefore, apparent that PM did not even have the
shares referred to by the transferee the respondent, in his
name, when the transfer documents were executed on
0
11.11.1992 and 13.11.1992, or even on 14.2.1993 when
the Board of Directors of the Society, passed the transfer
resolution. These shares were shown to have been
transferred to the name of the appellant on 16.12.1994.
Well before 16.12.1994, even according to the stance
adopted by the respondent, the appellant had executed
E
all the transfer documents. It is therefore difficult to
accept, that the parties had agreed to pass on
consideration by transfer of shares, which were not even
owned by the respondent (through PM) on the date of
transfer of flat no. SD from the appellant to the
F
respondent. Therefore, the stance adopted by the
respondent in the written statement filed by her before the
Arbitrator, is shown to be false. [Paras 28(iii), (iv)] [719-DH; 720-A-E; 721-D-F]
3.3. On the subject of transfer of shares from the
name of PM to the name of the appellant, the appellant
had adopted the stance, that the transfer of the above
shares was on account of return of loans extended by
G
the appellant to PM. The appellant had asserted, that after
H
668
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A
the transfer of PM from Calcutta to Bombay in the year
1993, he gave up his employment with CP Ltd. and started
a business of aluminium products. To help PM with his
business venture, the appellant had (on the asking of PM)
paid a sum of Rs. 2 lakhs by way of cheque, for supply
B of raw materials to PM's business venture. PM had also
taken a loan for a sum of Rs. 1,50,000/- for the same
purpose from the sister of appellant). It was also ass~rted,
that SM had similarly extended loans, by making
payments through cheque to PM. The Arbitrator had
C accepted the said assertion of the appellant. The
Arbitrator had placed reliance, on documentary and oral
evidence, produced by the appellant. The instant factual
aspect of the matter was totally overlooked by the Cooperative Tribunal, as well as, by the High Court. The fact
that appellant had addressed a letter to the Secretary of
D the Society, dated 28.2.1995, for withdrawal of her earlier
letter dated 11.11.1992 was not disputed. It is also not a
matter of dispute that at the time when the appellant
addressed the above letter, neither the transfer of
membership, nor the transfer of the flat, had assumed
E
finality. The transfer of membership, as also the transfer
of the flat, would assume finality only upon the approval
of the same by the Deputy Registrar, Co-operative
Societies. The factual position emerging from the record
of the case revealed that the Society sought the approval
F
of the Deputy Registrar, Co-operative Societies for the
transfer of membership, as also, flat no. 5D to the name
of Respondent on 13.3.1995. Through the letter dated
10.4.1~95, the appellant was informed, that the Society
had no authority to look into the matter, after the
G resolution of the Board of Directors dated 2.4.1995. This
explanation is untenable. It was imperative for the Society
to have examined the withdrawal letter dated 28.2.1995,
the matter certainly had not been concluded. Well after
the withdrawal letter, the Society by its notice dated
H 16.4.1995 had intimated its members, about the resolution
PRATI MA CHOWDHURY v. KALPANA MUKHERJEE & 669
ANR.
dated 2.4.1995. The matter was, therefore, pending
A
authoritative conclusion. Thus viewed, it was not justified
for the Society to deny consideration of the withdrawal
letter dated 28.2.1995. Acceptance or rejection on merits
is another matter, but non-consideration is not
understandable. The instant non-consideration clearly
B
invalidated the resolution passed by the Society. [para 28
v, vi] [721-H; 722-A-E; 723-A-F]
~
3.4. When the letter dated 22.3.1995 was addressed
to the Deputy Registrar, Co-operative Societies, it had not
yet granted approval to the recommendations made by
C
the Society. The receipt of the letter dated 28.2.1995, by
the Society (as also the receipt of the letter dated
22.3.1995, by the Deputy Registrar, Co-operative
Societies) is not disputed. The decision taken by the
Deputy Registrar, Co-operative Societies was, without D
reference to the withdrawal letter dated 28.2.1995. ·The
determination by the Deputy Registrar, Cooperative
Societies, cannot therefore be treated as a valid and
legitimate consideration. The instant non-consideration
clearly invalidated the approval granted by the Deputy
E
Registrar, Co-operative Societies. The veracity of the
execution of the documents dated 11.11.1992 and
13.11.1992 by the appellant, was also examined by the
Arbitrator. In the said examination, the Arbitrator arrived
at the conclusion, that the appellant was in Bombay and
not in Calcutta when these documents were executed.
The said finding was recorded on the basis of three
witnesses produced on behalf of the appellant (before the
Arbitrator). While rejecting the conclusion drawn by the
Arbitrator, the Co-operative Tribunal overlooked the
statements of the witnesses produced by the appellant,
G
merely because the notary was an Advocate. The Cooperative Tribunal reasoned, that the statement of an
Advocate, had to be given more weightage, than the
witnesses produced by the appellant. The above
determination at the hands of the Co-operative Tribunal,
F
H
670
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A besides being perverse was also totally unacceptable in
law. In the facts and circumstances of the instant case,
the statement of the notary should have been rejected
and discarded, simply because the notary in his
deposition had acknowledged, that he did not issue any
8 notarial certificate in terms of Section 8 of the Notary Act.
In the absence of issuance of any such certificate,
notarization of the document dated 13.11.1992 was
clearly subject to suspicion. The conclusion drawn by the
Co-operative Tribunal as also the High Court, to the effect
that the document dated 13.11.1992 was executed at
C Calcutta, was therefore, based on no evidence
whatsoever. The fact that the document dated 13.11.1992
-
.
had not been executed in Calcutta, was also sought to
be substantiated by showing, that the registration
number of the Society was not depicted in the said letter,
D even though the said letter was shown to have been
executed at the residence of the Secretary of the Society.
It was reasoned, that the Secretary of the Society would
have supplied the aforesaid number, if the above
document had been executed at his residence. Having
E rejected the credibility of the statement of the notary and
having not accepted the fact that the above document
was executed at the residence of the Secretary of the
Society, there is no reason for not accepting the
statements of the three witnesses produced by the
F appellant, to show that she (appellant) was at Bombay on
11.11.1992, as well as, on 13.11.1992. The Cooperative
Tribunal and the High Court, erred on the face of the
record, by not taking into consideration material f;>.cts.
available on the file of the case. [Para 28 viii, viii] [723-H;
G- 724-A-H; 725-A-E]
3.5. The Arbitrator had placed heavy reliance on the
fact, that the respondent had deposited rent on
21.10.1993 (payable to the appellant), into the account of
the appellant, by herself, filling up the bank deposit
H vouch.er. Accordingly, the Arbitrator inferred, that the
PRATIMA CHOWDHURY v. KALPANA MUKHERJEE & 671
ANR.
property in question, even to the knowledge of the A
respondent, had not actually been transferred to her
name by the appellant (at least upto 21.10.1993). That was
the reason, why the respondent had continued to deposit
rent for flat no. 50, into the account of the appellant upto
21.10.1993. Coupled with the said factual aspect, the B
Arbitrator placed great reliance on the letter dated
28.10.1993 addressed by PM to CP Limited, wherein, he
described the appellant as the "landlady". Undoubtedly,
if the documents relied upon by the respondent were
genuine, PM would not have acknowledged the C
ownership of the appellant over flat no. 50 (on
28.10.1993). The detern:tination of the Arbitrator, on the
subject of the transfer of the covered garage, to the name
of the respondent was also overlooked by the Cooperative Tribunal, as well as, by the High Court. The
appellant, had one covered garage space also. Whilst D
reference was made about the details of the flat sought
to be transferred, in the transfer documents, no reference
was made to the CQVered garage space. Based on the
letter dated 11.11.1992, and the document dated
13.11.1992, flat no. 50 was transferred to the name of the E
respondent. The instant transfer however did not include
the covered garage space. Thereafter, based on an
agreement executed between respondent (on the one
hand), and the Society (on the other), the said covered
garage space was transferred to the name of the F
respondent, on 25.4.1995. The said transfer was not at the
behest of, or with the concurrence of the appellant.
Therefore, according to the view expressed by the
Arbitrator, the covered garage space, must be deemed to
have never been transferred to the respondent by its G
erstwhile owner. The Arbitrator also expressed the view,
that the agreement dated 25.4.1995 could not have been
executed without the participation of the appellant. The
instant aspect of the matter was also totally overlooked
by the Co-operative Tribunal, as well as, by the High H
672
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A
Court. The findings of the fact, recorded by the Cooperative Tribunal and by the High Court, are bound to
be treated as perverse. [Para 28 ix, x] [725-G-H; 726-A, EH; 727-A-B]
4. The Co-operative Tribunal as well as the High Court,
8
had invoked the principle of justice and equity, and the
doctrine of fairness, while recording their eventual
findings in favour of the respondent. It is not a matter of
dispute, that for a long time appellant had been residing
at Bombay. She was residing at Bombay in the house of
C
her sister. PM, son of the respondent was an engineering
graduate; He also possessed the qualification of MBA.
Originally PM was employed as Sales Manager/Regional
Manager with CP Ltd. at Bombay. PM married SM (the
daughter of appellant's sister), whilst he was posted at
o Bombay in 1987. Soon after his marriage, PM and SM also
started to live in the house of HPR (father-in-law of PM).
HPR was wealthy person. The evidence available on the
record of the case revealed that the appellant treated SM
as her daughter, and PM as her son. In 1992, PM was
E
transferred from Bombay to Calcutta. Immediately on his
transfer, the appellant accommodated him in flat no. 50.
Subsequently, CP Ltd. entered into a lease and licence
agreement, in respect of flat no. 50 with the appellant, so
as to provide residential accommodation to PM (as per
F
the terms and conditions of his employment). Obviously,
PM was instrumental in the execution of the above lease
and licence agreement. In order to deposit monthly rent
payable to the appellant (by CP Ltd.), PM opened a bank
account in the name of the appellant, jointly with himself.
He exclusively operated the above account, for deposits
G as well as for withdrawals. Not only that, the findings
recorded by the Arbitrator indicate that the letter dated
11.11.1992 written by the appellant was drafted by PM. The
said conclusion was drawn from the fact that the
manuscript of the original was in the handwriting of PM.
H All these facts demonstrated a relationship of absolute
PRATIMA CHOWDHURY v. KALPANA MUKHERJEE &673
ANR.
trust and faith between the appellant and PM. The said
relationship emerged, not only on account of the fact that
PM was married to SM (the niece of the appellant), but also
A
B
on account of the fact, that PM and his wife SM soon after
their marriage lived in the house of HPR (husband of the
sister of the appellant). They resided together with the
appellant till 1992, i.e., for a period of more than a decade,
before PM was transferred to Calcutta. The relationship
between PM and the appellant would constitute a fiduciary
relationship. Even though all these aspects of the
relationship between the parties were taken into c
consideration, none of the adjudicating authorities dealt
w.ith the controversy, by taking into account the fiduciary
relationship between the parties. When parties are in
fiduciary relationship, the manner of examining the validity
of a transaction, specifically when there is no reciprocal
consideration, has to be based on parameters which are
different from the ones applicable to an ordinary case.
[Para 30] [727-E-H; 728-A-H; 729-A-B]
5. The relationship between PM and the appellant
was a relationship of faith, trust and confidence. PM was
in a domineering position. He was married to SM. SM was
the daughter of HPR. The appellant has lived for a very
long time in the house of HPR. During that period (after
his marriage) PM also shared the residential
accommodation in the same house with the appellant, for
over a decade. In Indian society the relationship between
PM and the appellant, is a very delicate and sensitive one.
It is therefore, that the appellant extended all help and
support to him, at all times. She gave him her flat when
D
E
F
he was transferred to Calcutta. She also extended loans
G
to him, when he wanted to set up an independent
business at Bombay. These are illustrative instances of
his authority, command and influence. Instances of his
enjoying the trust and confidence of the appellant
included amongst others, the joint account of the
H
674
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A appellant with PM, which the latter operated exclusively,
and the drafting of the letters on behalf of the appellant.
In such fact situation, the onus of substantiating the
validity and genuineness of the transfer of flat no. 50, by
the appellant, through th·e letter dated 11.11.1992 and the
B document dated 13.11.1992, rested squarely on the
shoulders of the respondent. Because it was only the
relationship between PM and the appellant, which came
to be extended to the respondent. The document dated
13.11.1992 clearly expressed, that the said transfer was
c without consideration. The respondent in her written
reply before the Arbitrator asserted; that the above
transfer was on a consideration of Rs.4,29,000/-. The
Arbitrator in his order dated 5.2.1999 concluded, that the
respondent could not establish the passing of the
0 consideration to the appellant. The Cooperative Tribunal,
as well as, the High Court, despite the factual assertion
of the respondent were of the view, that passing of
cc:msideration was not essential in determination of the
gehuineness of the transaction. The respondent
miserably failed to discharge the burden of proof, which
E essentially rested on her. The appellant led evidence to
show, that she was at Bombay on 11.11.1992 and
13.11.1992. Letter dated 11.11.1992 and the document
dated 13.11.1992, shown to have been executed at
Calcutta could not be readily accepted as genuine, for the
F said documents fell in the zone of suspicion, more so,
b_ecause th.e manuscript of the letter dated 11.11.1992
was in the hand-writing of PM leading to the inference,
that.PM was the author of the above letter. It is, therefore,
not incorrect to infer, that there seems to be a ring of truth,
G in the assertion made by the appellant, that PM had
obtained her signatures for executing the letter and
document. The.re was no justification whatsoever for the
appellant, to have transferred flat no. 50 to the
respondent, free of cost, even though she had purchased
H the same for a consideration of Rs. 4 lakhs in the year
,
PRATI MA CHOWDHURY v. KALPANA MUKHERJEE & 675
ANR.
1987. Specially so, when she had no direct intimate A
relationship with the respondent. By the time the flat was
transferred, more than a decade had passed by, during
which period, the price of above flat, must have escalated
manifold. The invocation of the principle of justice and
equity, and the doctrine of fairness, would in fact result B
in returning a finding in favour of the appellant, and not
the respondent. [Para 31) [733-D-H; 734-A-H; 735-A-C]
Subhas Chandra Das Mushib vs. Ganga Prosad Das
Mushib AIR 1967 SC 878: 1967 SCR 331; ; Krishna Mohan
Ku/ alias Nani Charan Ku/ vs. Pratima Maity (2004) 89 SCC C
468; Anil Rishi vs. Gurbaksh Singh, (2006) 5 SCC 558 ~
relied on.
Case Law Reference:
(1995) 1 sec 214
relied on
Para 27
(2012) 11 sec 1
relied on
Para 27
(2010) 12 sec 458
relied on
Para 27
1967 SCR 331
relied on
Para 30 ·
(2004) 89 sec 468
relied on
Para 30
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
1938 of 2014.
D
E
From the Judgment and Order dated 14.02.2006 of the
F
High Court of Calcutta in CO. Nos. 3039 & 3040 of 2002.
A.T.M. Sampath, P.N. Ramalingam, T.S. Shanthi, Rahul
Nagpal, Jitendra Mohan Sharma, Ajit Sharma, Nitin Singh,
Sameer Singh, Sandeep Singh, Mithilesh Kumar Pandey, G
Pahlad Sharma for the Appearing Parties.
The Judgment of the Court was delivered by
JAGDISH SINGH KHEHAR, J. 1. Orchestra Cooperative House Society Limited (hereinafter referred to as 'the H
676
SUPREME COURT REPORTS
[2014] 2 S.C.R.
A
Society') raised flats at 48/IE, Gariahat Road, Calcutta -
700019. lndirani Bhattarcharya became a member of the
Society on 12.1.1987. She was issued share certificates
bearing nos. 0047 and 0048. Based on the above membership
she was allotted flat no. 5D for a consideration of Rs. 4 lakhs.
B
The above flat measuring 900 sq. ft.