Partly allowed

Mohammad Khan @ Babamiya Noorkhan. v. Haji Shaikh Lal Shaikh Ahemad and Others.

Bombay HC13 Jul 2010SA/32/1988

Case brief

AI extract

What is this about?

The High Court allowed a second appeal partly, setting aside a decree for specific performance of an agreement for sale due to the partial acquisition of the suit property by the government. The Court directed the defendants to refund the earnest money with interest.

What did the court decide?

The decree for specific performance is set aside. Appellants must refund Rs.13,000 plus 12% interest from the date of the suit.

Mohammad Khan @ Babamiya Noorkhan. Vs Haji Shaikh Lal… — Specific Performance | Bombay HC (2010)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY APPELLATE SIDE, BENCH AT AURANGABAD

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SECOND APPEAL NO. 32 OF 1988

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`Mohammadkhan alias Babamiya`
`s/o Nurkhan,(since deceased)`
`through legal heirs as under:`

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`(1)`	`Nafizkhan s/o Mohammad Khan` `age 50 years,occup.business,` `r/of Sharif Colony,Kiradpura,` `Aurangabad.`
`(2)`	`Nashirkhan s/o Mohammad Khan,` `age 35 years, occup.business,` `r/of Sharif Colony,Kiradpura,` `Aurangabad.`
`(3)`	`Amzadkhan s/o Mohammad Khan,` `age 33 years, occup.business,` `r/of Sharif Colony, Kiradpura,` `Aurangabad.` `..Appellants/` `defendants.` `versus`
`1.`	`Haji Shaikhlal s/o Shaikh` `Ahmed, age major, occup.` `business,`
`2.`	`Shaikh Rehman s/o Sk.Ahmed,` `age major,`
`3.`	`Sk. Osman s/o Sk. Ahmed,` `age major,`
`4.`	`Abdul Majid s/o Babu Minya,` `age major,`
`5.`	`Bashir Ahmed s/o Babaminya,` `age major occup. business,` `(since deceased), through` `legal heirs as under:-`

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5-A. Mrs.Badrunissabegum w/o Bashir Ahmed, age 38 years, occup. household, r/of Dalalwadi, Aurangabad.

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5-B. Rafiq Ahmed s/o Bashir Ahmed, age 22 years, occup. driver, r/of Dalalwadi, Aurangabad.

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5-C. Amir Ruzwana w/of Samad Khan age 20 years,occup.household, r/of Mujib Colony,Roshan Gate, Aurangabad.

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5-D. Shaeen Ruzwana w/o Afsar, age 19 years, occup.household, r/of Baijipura, Aurangabad.

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5-E. Shabana Ruzwana d/o Bashir Ahmed, age 17 years, minor, u/g of R.5-A above.

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5-F. Miss Shaeen Erphana d/o Bashir Ahmed, age 15 years, minor u/g of R.No.5-A.

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5-G. Shafeeq Ahmed s/o Bashir Ahmed, age 13 yrs.minor, u/g of R.5-A.

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5-H. Afeekh Ahmed s/o Bashir Ahmed, age 11 years, minor, under g/of R.No.5-A.

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6. Shaikh Hyder s/o Shaikh Ahmed, Respondents/ age major, occup,business. ori.pltffs.

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Respondent Nos. 1 to 6 r/of
Dalalwadi, Aurangabad. Resp.No.4
presently at Bombay and Resp.No.6
presently at Murshidabad.

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Shri N.K. Kakade, Advocate for the appellants. None
for Respondent Nos.1 to 5. Shri P.G. Godhamgaonkar,
Advocate for Respondent No.5-A to 5-H and Resp.No. 6.

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Coram : P.R. Borkar, J.
Date : July 13, 2010.

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ORAL JUDGMENT

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01.This appeal is preferred by original
defendant who is represented by his legal heirs
being aggrieved by the judgment and decree for
specific performance of agreement for sale passed
by the learned Joint Civil Judge, Senior Division,
Aurangabad, in Special Civil Suit No.95 of 1983
decided on 30.9.1985, which judgment and decree
with some modification was confirmed by the
learned Joint District Judge, Aurangabad, in
Regular Civil Appeal No.238 of 1985 decided on
24.12.1987.

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02.Briefly stated, the facts giving rise to
this second appeal are as under;

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Agreement for sale was executed on
19.6.1978 vide Exhibit 29 by appellant-defendant
in favour of the respondents-plaintiffs. By the

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said agreement for sale, the appellant-defendant
agreed to sell 250 ft. x 250 ft. area out of
C.T.S. No.11632, sheet No.239 (old S.No.42)
situated at Jaswwantpura, Aurangabad for total
consideration of Rs.33,500/= out of which, amount
of Rs.13,000/= was paid to him by the plaintiffs

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as earnest money on the same day for which
separate receipt Exhibit 30 was also executed.
Balance amount of Rs.20,500/= was to be paid at
the time of the sale deed that was to be executed
within two years from 19.6.1978. In paragraph 3
of the agreement, it is specifically stated that

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in case CIDCO or any other government authority
acquired the land agreed to be sold or portion
thereof, the vendor-original defendant Mohammad

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Khan would give and hand over to the plaintiffs
another proportionate land out of said C.T.S.
number. Plaintiffs were ready and willing to
perform their part of the contract, but the
defendant avoided and, therefore, on 22.5.1980,
plaintiffs issued notice to the defendant to
complete the transaction. However, the defendant
refused to execute the sale deed and, therefore,

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suit for specific performance of contract was
filed on 27.2.1983.

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03.The appellant-defendant resisted the suit

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by filing written statement at Exhibit 19. He
denied execution of any agreement for sale by him

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in favour of the plaintiffs or or even receipt
Exh.30 by him for having received earnest amount
of Rs.13,000/=. According to appellant-defendant,

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his father Noorkhan was the protected tenant of

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S. No.42 admeasuring 2 acres 32 gunthas of village
Jaswantpura, Aurangabad and was cultivating the

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same. According to defendant the said land was
belonging to one Raichotelal. It is the case of

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the defendant that his father Noorkhan was

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declared as owner of the said land under Section
38-E of the Hyderabad Tenancy and Agricultural

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Lands Act and thus he had become statutory owner
of the same and, therefore, without permission of

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the Collector under Section 50-B of the said Act,

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there cannot be sale of the said property.

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According to appellant-defendant only Rs.5000/=
were lent to him by plaintiffs to him and the

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document was executed as security for the said
loan. In the circumstances, defendant prayed for
dismissal of the suit.

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04.The trial court framed necessary issues
and held that the defendant failed to prove his
case of transaction being of loan. It is held that
the transaction was in the nature of agreement for
sale. Amount of Rs.13,000/= was paid as part of

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total consideration amount of Rs.33,500/=.
Plaintiffs were entitled to specific performance
of contract on payment of balance amount of Rs.
20,500/=.

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05.As against the said judgment and decree
of the trial court, defendant filed appeal before
the District Court, but the learned District Judge
came to the conclusion that since the property was
declared in the name of Noorkhan under Sec. 38-E

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of the Hyderabad Tenancy and Agricultural Lands
Act, there could not be transfer of the suit
property without permission of the Collector and,
therefore, he modified the decree of the trial

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court and directed the defendant-appellant to move
the Collector for obtaining necessary permission
within a period of three months from the date of
the judgment and in case of failure by defendant,
the learned Judge permitted the plaintiffs
defendant to apply for such permission to the
Collector and on obtaining such permission, decree
for specific performance was to be implemented.
Nothing is mentioned by the learned District Judge
as to what is to happen in case permission is not
applied for or granted by the Collector. As
against judgment of the District Court, this
second appeal is filed.

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29.2.1988 on substantial questions law mentioned
in ground Nos. 1 and 2 of the appeal memo, which
read as follows;

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"1.That the lower Appellate Court has
held that the subject-matter of the suit
is agricultural land and has modified the
decree passed by the Trial Court with
directions to the Appellant-Defendant to

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supply (apply) to the Collector under
Section 50-B of the Hyderabad Tenancy and
Agricultural Lands Act, 1950 for
necessary permission for sale of the
property to the plaintiff within a period
of three months or in case of failure on
the part of the Defendant, that the
plaintiff will be at liberty to apply for
the permission. From this modification
and direction, it is clear that the
subject-matter of the agreement for sale
was the agricultural property. If it
were so, then under Section 47 of the
Hyderabad Tenancy Act, there is a
restriction for sale of agricultural
property to a non-agriculturist, unless
the prospective purchaser is an
agriculturist. Whether in the facts and
circumstances of this case, specific
performance of an agreement for sale of
an agricultural property could be
directed by the Civil Court when both the
lower Courts have not only not framed
issues and points on the status of the
Plaintiffswhethertheyare
agriculturists or not.

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2.Whether the lower Appellate Court
has clearly come to the conclusion that
the subject-matter of the agreement for

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sale was the agricultural property,
subject to the provisions of the
Hyderabad Tenancy Act, whether specific
performance of the agreement for sale can
be granted without an enquiry in that
connection as provided for under Section
47 of the Hyderabad Tenancy Act.?"

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07.It is argued by Shri N.K.Kakade, learned

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Counsel for the appellant that not only permission
for valid sale is required under Section 50-B of
the Hyderabad Tenancy and Agricultural Lands Act,
but the document filed by him at Exh.P-1 along
with Civil Application No.9459 of 2010 also needs

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to be considered inasmuch as pending the
litigation, portion of said city survey No.11632
was acquired by the Government for road widening.

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As per the letter dated 19.8.1986 (Exh.P-1 to
Civil Application) the Special Land Acquisition
Officer has called upon the original defendant
Mohammad Khan (appellant herein) to furnish
certain information in connection with acquisition
of said property. So, it is stated that identity
of the suit property is no more same. It is also
argued that in fact, the suit property having been

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acquired by the Government, the same does not
exist for transfer in favour of the plaintiffs-
respondents.

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08.Shri P.G.Godhamgaonkar, learned Advocate

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for the Respondents, submitted that though he
received copy of the civil application along with
its annexures, he could not get necessary
instructions from his clients and, therefore, he
would not be able to say anything about the
development of acquisition etc. However,

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according to the learned counsel, since the
property was already put to non agricultural use
and given city survey number, the provisions of

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Section 50-B of the Hyderabad Tenancy and
Agricultural Lands Act would not be applicable to
the facts of this case.

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09.Shri N.K.Kakade, learned counsel for the

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appellant relied upon certain authorities. First
authority is K. Narendra vs. Riviera Apartments

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(P) Ltd. AIR 1999 S.C. 2309. In the said case,
purchasers had failed to perform their obligations

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within reasonable time and the prices of the

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property increased many-fold and, therefore, the
court declined to use discretion for allowing
specific performance. In the reported case, part
of the property was also rendered inalienable
subsequently having been acquired by State and
some part found to be inalienable under Urban Land
Ceiling Regulation Act. In paragraph 36 of the
said judgment, it is observed that the contract
was frustrated under Section 56 of the Contract
Act.

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10.Second case relied upon by Advocate Shri
Kakade isV. Muthusami vs. Angammal and ors. AIR

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2002 S.C. 1279. It is observed in para 20 of the
said case that the grant of specific performance
is a discretionary relief. Reference to Section
20 of Specific Relief Act was made and it is held
that the court is not bound to grant relief merely
because it is lawful to do so and further that if
performance of a contract involves some hardship
on the defendant which he did not foresee, while
non-performance involves no such hardship on the
plaintiff, specific performance of agreement may

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not be allowed. Learned counsel also drew my
attention paras 22 and 23 of the said case. In
the said case, property was purchased by a
purchaser bonafide for value without notice.
Under the circumstances, a the court was pleased
to allow refund of earnest money.

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11.Shri Kakade, learned counsel for
appellant also relied upon the case of Mrs.

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Chandnee Widya Vati Madden vs. Dr. C.L. Katial AIR

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1964 SC 978. In the said case, there was term that
the vendor shall obtain necessary permission from
the government before sale. The vendor had made
such application, but had withdrawn the same
subsequently. As paragraph 5 of the judgment in
said case discloses, the court allowed specific
performance.

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12.Last case relied upon by Advocate Shri
Kakade isDnyanoba vs. Shrirang 1982 (2) Bom.C.R.

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18. In the said case, there was necessity to
obtain permission of the Collector under Section
50-B of the Hyderabad Tenancy and Agricultural

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Lands Act as the land was purchased by tenant
under Section 38-E. The question that was raised
for consideration of the court was entirely
different. The question was whether the defendant
was entitled to protection of Section 53-A of the
Transfer of Property Act, 1882.

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13.Coming back to the facts of our case, the

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first appellate court has discussed evidence and
facts in details in paras 9 and 10. It is observed
that the plea was raised that the suit plot was
earlier having survey No. 42 which was not allowed

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to be used for N.A. purposes and, therefore,
permission of the Collector was required.
However, at the same time, it is brought on record

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that old survey No.42 was included in the city
survey and in the municipal limits of Municipal
Corporation, Aurangabad and, therefore, renumbered

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as plots for residential purposes. In the
circumstances, the trial court came to the
conclusion that though survey No.42 was in
existence, it is recorded as city survey number.
So, argument advanced on behalf of the respondents

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came to be accepted by the trial court, but the
appellate court accepted the defence that since
the property was not put to N.A. use, Section 50-B
of the Hyderabad Tenancy and Agricultural Lands
Act was applicable. The appellate court came to
the conclusion that permission of the Collector
was required. there is no record regarding actual
conversion of original agricultural land into non
agricultural land. The agreement is of 1978 and it
is not known if the property was under cultivation
in 1978. So, observations by the District Court
that the permission of the Collector would be
required cannot be said to be illegal.

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14.In this matter, the defendant-appellant

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has come with a case that already major chunk of
the suit property has been acquired for the
purpose of road widening and as such the identity
of the property is not the same any more. To this

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case of the defendant, there is nothing in
rebuttal. So, it appears that since long back
i.e. year 1983 the suit property has undergone
changes and as such lost its identity. In the

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circumstances, it would be difficult to execute
decree even if clause (3) of the original
agreement speaks about giving alternate land,
because it is not known whether the appellant or
his legal heirs are owners in possession of any
alternate land from same survey number to give the
same to the respondents-plaintiffs in substitution
of the land acquired by the Municipal Corporation.

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15.Having regard to the totality of the
facts and circumstances, in my opinion, it is
preferable to allow this appeal partly. In stead
of specific performance, it would be just and
proper to direct refund of earnest amount with
interest. Considering that litigation is pending
since 1983, interest at 12 per cent per annum
would be proper.

¶98

16.In the result, appeal is partly allowed.

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The decree for specific performance of agreement
for sale passed by the trial court as confirmed by
the district court is hereby set aside. It is
directed that the appellants-defendants shall pay

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back the amount of Rs.13,000/= to the plaintiffs
along with interest at the rate of 12 per cent per
annum from the date of the suit i.e. 27.2.1981
till actual payment. The appellants shall also pay
proportionate costs to the respondents and bear
their own.

¶102

Appeal stands disposed of, accordingly.

¶103

pnd/SA32.88 (P.R.BORKAR, J.)

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Mohammad Khan @ Babamiya Noorkhan. v. Haji Shaikh Lal Shaikh Ahemad and Others.

Case brief

What is this about?

What did the court decide?

Mohammad Khan @ Babamiya Noorkhan. v. Haji Shaikh Lal Shaikh Ahemad and Others.

Case brief

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What did the court decide?

What the court decided

A compact analysis

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