Burden Of Proving Sale Deed Is Bona Fide Lies On Beneficiary If Executant Is Illiterate Or Vulnerable: Andhra Pradesh High Court

"The logic is equally applicable to an old, illiterate, ailing person who is unable to comprehend the nature of the document or the contents thereof. It should be established that there was not mere physical act of the executant involved, but the mental act." High Court of Andhra Pradesh at Amaravati, in a significant judgment, held that when a registered sale deed is challenged by an illiterate or vulnerable person on grounds of fraud, the burden of proving the transaction's good faith shifts to the beneficiary who held a position of active confidence.

A bench of Justice V. Gopala Krishna Rao observed that the mere registration of a document does not provide it absolute immunity if the underlying transaction is tainted by undue influence or lack of mental consent.

The case involved an illiterate widow, Kolusu Gangamma, who alleged that a village elder and his son fraudulently obtained two registered sale deeds from her by misrepresenting them as a conveyance for a small house site and a subsequent rectification deed. The trial court had cancelled the sale deeds, leading the defendants to appeal the decision before the High Court.

The primary question before the court was whether the sale deeds (Ex.B1 and Ex.B2) were obtained through fraud and undue influence from an illiterate woman. The court was also called upon to determine whether statements recorded under Section 161 of the CrPC can be used in civil proceedings and upon whom the burden of proof lies in transactions involving persons in a fiduciary relationship.

Admissibility Of Section 161 CrPC Statements In Civil Suits

Court Clarifies Scope Of Section 162 CrPC Bar

The High Court first addressed a procedural objection regarding the use of police statements in a civil trial. Relying on the Apex Court's ruling in Khatri and others etc. Vs. State of Bihar, the bench noted that the bar under Section 162 of the Code of Criminal Procedure is limited to criminal inquiries or trials.

The court observed that a statement made before a police officer during an investigation can be produced and used in evidence in civil proceedings if it is relevant under the Indian Evidence Act. The bench emphasized that such statements can be used for contradicting witnesses under Section 145 of the Evidence Act to achieve the ends of justice in civil cases.

Active Confidence And Shift Of Burden Of Proof

Dominant Party Must Prove Fair Play Under Section 111 Evidence Act

While examining the relationship between the parties, the court found that the first defendant had been managing the affairs of the illiterate plaintiff for nearly 30 years following her husband's death. This established a relationship of "active confidence" where the defendant was in a position to dominate the plaintiff's will.

The court held that under Section 111 of the Indian Evidence Act, when a person in a fiduciary relationship enters into a transaction with the person who reposes confidence in them, the burden of proving the good faith of the transaction is on the dominant party. The court noted that it must be established that there was a "mental act" of consent, not just a "physical act" of signing or affixing a thumb impression.

"When a person is in a fiduciary relationship with another and the latter is in a position of active confidence, the burden of proving the absence of fraud, misrepresentation or undue influence is upon the person in the dominating position."

Presumption Of Validity For Registered Documents

Registration Does Not Validate A Sham Transaction

The appellants argued that under the principles laid down in Hemalatha vs. Tukaram, a registered sale deed carries a formidable presumption of validity. However, the High Court observed that this presumption is rebuttable. The court pointed out several suspicious circumstances, such as false recitals regarding the plaintiff's medical condition and the non-delivery of original title deeds, which were actually in a bank's custody.

The bench remarked that the sanctity of registered documents cannot be used as a shield to protect transactions obtained through deceit. If the party challenging the deed provides material particulars of fraud and demonstrates that the deed was never intended to be a bona fide transfer of title, the presumption of validity is displaced.

Adverse Inference For Non-Examination Of Party

Failure To Enter Witness Box Is Fatal To Defence

A critical point in the court’s reasoning was the failure of the second defendant (the vendee) to testify. Despite allegations of non-payment of consideration and fraud, the vendee did not enter the witness box to speak about the execution of the sale deeds or the passing of consideration.

Citing the landmark case of Vidhyadhar vs. Manikrao, the court held that where a party to a suit abstains from the witness box and does not offer themselves for cross-examination, a presumption arises under Section 114(g) of the Evidence Act that the case set up by them is incorrect. The bench termed this failure as "fatal to the defence."

"When a party, who is expected to depose about the material facts within his exclusive knowledge, abstains from entering into the witness box, the Court is entitled to draw an adverse inference against such party."

The High Court concluded that the plaintiff had successfully discharged her initial burden by showing suspicious circumstances, and the defendants failed to prove that the transactions were free from undue influence. Consequently, the court upheld the cancellation of the sale deeds and dismissed the appeals.

Date of Decision: 15 June 2026