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Roop Kumar v. Mohan Thedani

Supreme Court of India, 2 April 2003, 2 judges

The Court explained Sections 91 and 92 of the Evidence Act, held that the written agency-cum-licence agreement had been acted upon and was not a sham, and upheld the decree for possession, commission and damages against the licensee.

Facts

The respondent, a tenant of a shop in Karol Bagh, New Delhi, through his father and attorney entered into an agency-cum-licence agreement dated 15.5.1975 with the appellant, a tailor and draper, allowing him to use the shop as a showroom on payment of commission on his sales. The agreement expired on 14.5.1980 and was not renewed, but the appellant stayed on. The respondent sued for commission, rendition of accounts, possession and damages. The appellant pleaded that he was a sub-tenant and that the agreement was a sham, signed only to help the respondent in disputes with his own landlords. The trial court decreed the suit. In first appeal the Delhi High Court, with the parties' consent, decided the issues on the record itself, held the agreement genuine and acted upon, found a licence and not a lease, raised damages to Rs. 1,200 per month and dismissed the appeal.

Questions before the Court

  1. Having agreed that the High Court should decide the matter on the record instead of remanding, could the appellant complain of loss of a forum of appeal?
  2. What is the scope of Sections 91 and 92 of the Evidence Act, and could oral evidence show that the written agreement was a sham?
  3. Was the arrangement a licence or a sub-tenancy?

What the Court held

  • Statements in a judgment about what happened at the hearing are conclusive. A party who says a concession was wrongly recorded must go back to the same Judges; having agreed that the High Court decide on the record, the appellant could not later deny the concession.
  • Section 91 forbids proving the terms of a written contract otherwise than by the document; Section 92 bars oral evidence between the parties to contradict, vary, add to or subtract from its terms. The two sections supplement each other and apply only where the document appears to contain all the terms.
  • Section 91 applies to all documents, unilateral or bilateral, while Section 92 is confined to bilateral, dispositive documents. A party may still lead oral evidence that a deed was a sham never intended to operate; the bar arises only when the document is relied on and its terms are sought to be varied.
  • On the evidence, the appellant had acted on the agreement by rendering accounts and paying commission matching it to the paise. It was a licence; a sub-tenancy without the landlord's consent, forbidden by Section 16(2) of the Delhi Rent Control Act, could not be pleaded. The appeal was dismissed with costs of Rs. 25,000.

Why it matters

The judgment sets out the relationship between Sections 91 and 92 of the Evidence Act: both rest on the best evidence rule, Section 91 governs the mode of proof of any document and Section 92 excludes oral evidence to vary the terms of a bilateral dispositive document between the parties. It also confirms that oral evidence remains admissible to show that a document was a sham and never intended to be acted upon.

In the Court's words

Copied from the official judgment; each passage links to its page.

“Sections 91 and 92 apply only when the document on the face of it contains or appears to contain all the terms of the contract. Section 91 is concerned solely with the mode of proof of a document which limitation improved by Section 92 relates only to the parties to the document.”
Arijit Pasayat, J.Page 7 of the judgment
“Sections 91 and 92 in effect supplement each other. Section 91 would be inoperative without the aid of Section 92, and similarly Section 92 would be inoperative without the aid of Section 91. The two sections are, however, differ in some material particulars. Section 91 applies to all documents, whether they purport to dispose of rights or not, whereas Section 92 applies to documents which can be described as dispositive.”
Arijit Pasayat, J.Page 7 of the judgment
“The grounds of exclusion of extrinsic evidence are (i) to admit inferior evidence when law requires superior would amount to nullifying the law, (ii) when parties have deliberately put their agreement into writing, it is conclusively presumed, between themselves and their privies, that they intended the writing to form a full and final statement of their intentions, and one which should be placed beyond the reach of future controversy, bad faith and treacherous memory.”
Arijit Pasayat, J.Page 8 of the judgment

Provisions interpreted

Case and bench

Parties
Roop Kumar v. Mohan Thedani
Case
Civil appeal arising out of S.L.P. (C) No. 5835/2001
Decided
2 April 2003
Bench
Shivaraj V. Patil, Arijit Pasayat
Opinions
Unanimous. Judgment delivered by Arijit Pasayat, J.

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