Allowed

Vinod Kumar v. Negi Ram

Himachal Pradesh HC26 May 2017RSA/468/2003

Case brief

AI extract

What is this about?

In this second appeal regarding a property dispute, the High Court allowed the appellant's appeal, quashing the lower appellate court's decree. The High Court held the subsequent purchaser was not a bona fide purchaser due to knowledge of the prior agreement and affirmed the trial court's decree for specific performance and possession.

What did the court decide?

The impugned judgment and decree of the lower appellate court were quashed and set aside, and the judgment and decree of the trial court were affirmed.

Vinod Kumar Vs Negi Ram — Contract and Commercial Disputes | Himachal Pradesh HC (2017)

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IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA.

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RSA No. 468 of 2003.

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Reserved on: 27.3.2017. Decided on: 26.5.2017.

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Vinod Kumar ……Appellant. Versus Negi Ram & ors. …….Respondents.

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Coram The Hon’ble Mr. Justice Dharam Chand Chaudhary, Judge. Whether approved for reporting? Yes. For the appellant(s): Mr. V.D.Khidta, Advocate. For the respondents: Mr.K.D.Sood, Sr. Advocate with Mr. Sanjeev Sood, Advocate for respondent No. 1. Respondents No. 2 to 6 already ex-parte.

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Justice Dharam Chand Chaudhary, J.

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Plaintiff is in second appeal before this Court. He is aggrieved by the judgment and decree dated 17.9.2003, passed by learned District Judge, Shimla (Camp at Rohru) in Civil Appeal No. 54R/13 of 2003/2002, whereby the lower appellate Court has allowed the appeal i.e. in favour of respondent No. 1 (hereinafter referred to as defendant No. 2) and quashed the decree of specific performance of the contract which was passed by learned trial Court in favour of the plaintiff. He was also not held entitled to the relief of prohibitory injunction or declaration to the effect that the sale of the suit land by Puran Chand defendant No. 1 in favour of defendant No. 2 was illegal, null and void. The decree for permanent prohibitory injunction sought against the contesting defendants was also declined. However, while holding that agreement to sell Ext. PW-6/A was executed by defendant

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No. 1 in favour of plaintiff and that a sum of Rs. 13,000/- towards sale consideration was paid at the time of execution of the agreement, decreed the suit for recovery of the said amount in his favour and against defendant No. 1 Puran Chand. The Cross-Objections preferred by the plaintiff were also dismissed.

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The appeal has been admitted on the following substantial questions of law?

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“1) Whether the learned first Appellate Court was justified in holding that the subsequent purchaser of the suit land was a bonafide purchaser without notice of agreement to sell to the plaintiff in the absence of any foundation or plea in the written statement?

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Whether the findings of learned first Appellate Court, that there was no evidence to show that the possession of the suit land was handed over to the appellant, are against the record and dehors the evidence?”

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Defendant No. 1. Puran Chand along with defendants No. 7

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to 9, was joint owner of the land bearing Khasra Haal 362, Sabik 156 measuring 0-70-39 hects., situated in Chak Jhaknoti, Tehsil Chirgaon, District Shimla, H.P. He later on became exclusive owner thereof consequent upon family settlement having taken place between him and the other co-owners defendants No. 7 to 9. He agreed to sell the suit land for a consideration i.e. Rs. 35,000/- to the plaintiff and executed the agreement Ext. PW-6/A on 11.2.1999. At the time of execution of the agreement, defendant No. 1 received a sum of Rs.

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13,000/- from the plaintiff. The remaining amount of Rs. 22,000/- as per the agreement was to be paid to the said defendant at the time of registration of the sale deed. The possession of the disputed land allegedly was delivered by defendant No. 1 to the plaintiff at the time of execution of the agreement to sell. An affidavit was executed by defendant No. 1 on 6.4.1999 before Executive Magistrate Chirgaon, admitting thereby the receipt of a sum of Rs. 30,000/- towards part payment of the sale consideration and the balance i.e. Rs. 5,000/allegedly was agreed to be paid by the plaintiff to him at the time of execution of the sale deed. However, on 24.4.1999, defendant No. 1 allegedly received a further sum of Rs. 3200/- from the brother of the plaintiff and as such a sum of Rs. 1800/- was left to be paid to the defendant by the plaintiff towards full and final payment of the sale consideration as agreed upon. According to him, he was always ready and willing to perform his part of the agreement i.e. payment of balance consideration of Rs. 1800/- to defendant No. 1, however, it is the latter who failed to execute the sale deed in his favour. To the contrary, the said defendant fraudulently and dishonestly executed sale deed of the land in dispute in favour of Negi Ram, defendant No. 2 for a consideration of Rs. 18,000/- on 18.11.1999. Therefore, declaration to the effect that the sale deed, being the result of fraudulent transaction, not only null and void but also sham transaction, hence was sought to be declared illegal, null and void. Since a sum of Rs. 20,000/- was spent by him for raising an apple orchard over the land in dispute,

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therefore, the decree for specific performance of the contract was sought to be passed against defendant No. 1 directing him thereby to execute the sale deed in favour of the plaintiff in accordance with the agreement dated 11.2.1999 Ext. PW-6/A and affidavit dated 6.4.1999 Ext. PW-1/A. The sale deed dated 18.11.1999 executed by defendant No. 1 in favour of Negi Ram, defendant No. 2 was also sought to be declared null and void. The defendants No. 2 & 3 were also sought to be restrained from causing any interference with the possession of the plaintiff in the suit land and also to get the mutation thereof attested on the basis of the sale deed in favour of defendant No. 1.

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It is defendants No. 1 to 6 who had contested the suit whereas defendants No. 7 to 9 opted for not to put appearance despite service. In their joint written statement, the appearing defendants had come forward with the version that defendant No. 1 Puran Chand was mentally sick at the relevant time and the documents i.e. the agreement and affidavit were obtained by the plaintiff from him under misrepresentation of the facts. It was denied that a sum of Rs. 33,200/- was received by defendant Puran Chand from plaintiff, however, only a sum of Rs. 13,000/- was paid to him by the plaintiff. It was also denied that the sale deed executed by defendant No. 1 in favour of defendant No. 2 was the result of fraud and misrepresentation, hence, sham transaction. Defendant No. 2 rather was a bonafide purchaser and the mutation of the suit land was also sanctioned and attested in his favour by the revenue authorities.

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Replication was also filed. On such pleadings of the parties, following issues were framed by learned trial Court:

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“(1). Whether the plaintiff is entitled to the relief of specific performance of agreement to sell dated 11.2.1999, as alleged? …OPP.

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(2). Whether the sale deed executed by defendant No. 1 in favour of defendant No. 2 dated 18.11.1999 is result of fraud, as alleged, if so, its effect? …OPP.

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(3). Whether the plaintiff is entitled to the relief of permanent prohibitory injunction, as prayed for?

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…OPP.

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(4). Whether the suit is not maintainable in the present form, as alleged? …OPD.

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(5). Whether the suit of the plaintiff is not properly valued for the purpose of court fee and jurisdiction?

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…OPD.

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(6). Whether the plaintiff has not come to Court with clean hands, as alleged? …OPD.

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(7). Whether the plaintiff has obtained the agreement dated 11.2.1999 by misrepresentation of facts, insanity, illiteracy, poverty and backwardness of defendant No. 1, as alleged, if so, its effect? …OPD. (8). Whether the suit is bad for want of notice, as alleged? …OPD.

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(9). Whether the plaintiff is estopped from filing the present suit on account of his act, conduct and deed?

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…OPD.

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(10). Relief.”

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The plaintiff, in turn has himself stepped into the witnessbox as PW-2 and in support of his case that on the day of execution of

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the agreement Ext. PW-6/A, the possession of the suit land was delivered to him by defendant No. 1, he has examined PW-3 Vijay Nand, PW-4 Padam Dass, PW-5 Prem Singh, PW-7 Bahadur Singh and PW-8 Kushal Singh. PW-1 Dinesh Kumar, Clerk in the office of Tehsildar, Chirgaon was examined to prove the affidavit Ext. PW-1/A, allegedly executed by Puran Chand defendant No. 1, whereas scribe of the agreement Ext. PW-6/A is PW-6 Jita Singh.

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Defendant No. 2 Negi Ram has stepped into the witness box as DW-1 whereas defendant No. 1 Puran Chand as DW-3. In support of their case that the suit land was sold to defendant No. 2 and the said defendant was put in possession thereof, they have examined DW-2 Pyare Lal and DW-4 Darshan Dass.

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Learned trial Judge, on appreciation of the evidence available on record has decreed the suit for the relief of specific performance of contract in favour of the plaintiff and against defendant No. 1. The sale deed Ext. PW-2/B executed by defendant No. 1 Puran Chand in favour of defendant No. 2 was also declared illegal, null and void. By way of prohibitory injunction, the contesting defendants No. 1 to 6 were restrained from interfering in the peaceful possession of the plaintiff over the suit land.

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As noticed supra, learned lower appellate Court, though has decreed the suit, however, only for the recovery of Rs. 13,000/against the defendant while holding that agreement Ext. PW-6/A was executed by Puran Chand defendant No. 1 and thereby agreed to sell

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the suit land to the plaintiff. However, the plaintiff was not found to have discharged his obligation under the agreement and as such, decree for specific performance was declined. The sale deed Ext. PW2/B executed by defendant No. 1 in favour of defendant No. 2 Negi Ram was held legal and valid. The appeal was accordingly disposed of.

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Aggrieved by the impugned judgment and decree, the plaintiff has assailed the legality and validity thereof on the grounds inter-alia that cross-objections preferred by him against that part of the judgment and decree whereby learned trial Court has directed defendant Puran Chand to execute the sale deed were erroneously dismissed in complete departure to the evidence suggesting that in a family partition, the entire suit land fell in the share of defendant Puran Chand and he agreed to sell entire suit land vide agreement Ext. PW-6/A. Even, the grounds taken by the plaintiff in the crossobjections have also not been considered nor discussed. The findings that towards part performance of contract, payment of Rs. 30,000/- is not proved are also stated to be contrary to the evidence available on record. In this regard, the reference was made to the affidavit Ext. PW1/A executed by defendant No. 1 in which he had deposed qua receipt of Rs. 30,000/- towards part payment of the total consideration Rs. 35,000/-. The receipt qua payment Ext. PX of further sum of Rs. 3200/- to defendant No. 1 Puran Chand by the brother of the plaintiff has also not been taken into consideration. Therefore, the findings that the plaintiff was not ready and willing to perform his part of the

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contract are stated to be beyond the pleadings and evidence available on record. When defendant Puran Chand has himself admitted his signatures over agreement to sell Ext. PW-6/A and the affidavit Ext. PW-1/A and as no evidence was produced to show that he was under the attack of insanity or his signatures thereon were obtained by way of misrepresentation of facts by taking advantage of his illiteracy, poverty and backwardness, learned lower appellate Court should have not suspected the credibility of the evidence produced by the plaintiff that too when the agreement to sell Ext. PW-6/A was held to be a legal and valid document executed by the defendant in favour of plaintiff qua sale of the suit land. The denial of defendant Puran Chand in his crossexamination qua receipt of Rs. 33,200/- from the plaintiff should have not been given any weightage. It has further been canvassed that defendant No. 2 Negi Ram is not a bonafide purchaser as he was aware of the suit land sold by defendant No.1 to the plaintiff by way of agreement Ext. PW-6/A. It is pointed out that in the joint written statement filed by defendants No. 1 & 2, their stand was that at the time of execution of the agreement Ext. PW-6/A and the affidavit Ext. PW-1/A, defendant no. 1 was under the severe attack of insanity as no evidence to show that the said defendant was suffering from any mental ailment or he signed these documents under misrepresentation of facts has come on record. Both the documents make it crystal clear that the possession of the suit land was handed over by defendant No. 1 to the plaintiff. When these documents have been held to be legal

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and valid by learned lower appellate Court, no findings that the plaintiff is not in possession of the suit land could have been recorded. The defendants rather were well aware of the fact that it is the plaintiff who was in possession of the suit land. Therefore, sale thereof to defendant No. 2 vide sale-deed Ext. PW-2/B was illegal. The version of defendant no. 1 while in the witness-box as DW-2 and that of defendant No. 2 as DW-1 that the land was sold to defendant No. 2 for a sum of Rs. 69,000/-, however, in the sale deed the sale consideration finds mention as Rs. 18,000/- the defendants seem to have played fraud with a view to evade payment of stamp duty to the government. This aspect of the matter has also not been taken into consideration.

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The substantial question of law arising in this appeal have to be adjudicated in view of the arguments addressed on both sides and also the evidence available on record. However, before that the controversy as to whether the entire suit land bearing Kh. No. 362 has been agreed to be sold to the plaintiff by defendant No. 1 or it is only to the extent of his share has to be determined. Though, this part of the plaintiff’s case does not pertain to either of the substantial questions of law arises for consideration in this appeal. The adjudication of substantial questions of law, however, need determination of the controversy as to whether the entire suit land bearing Kh. No. 362 was intended to be sold by defendant No. 1 to the plaintiff or not also.

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Learned trial Judge, while answering issues No. 1,4, 6, 7 & 8 all together has noticed in para 12 of the judgment that though

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defendant No. 1 was in possession of the entire suit land bearing Kh. No. 362 new (old Kh. No. 156), however, not exclusively as owner thereof and rather in the capacity of a co-sharer with Vikramjit, Sansar Devi and Surgoni. The reference in this regard can be made to the entries in the jamabandi Ext. PW-2/A for the year 1996-97.

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As a matter of fact, S/Sh. Vikramjit (son), Km. Sansar Dei (daughter) and Smt. Surgoni (widow) of Arki Lal are owners of the suit land to the extent of ½ share whereas defendant No. 2 to the extent of remaining ½ share. Though, he was in possession of the entire land bearing Kh. No. 362, however, not in exclusion to other co-sharers and rather on their behalf also. Therefore, he could have not agreed to sell the entire land bearing Kh. No. 362, being not competent to do so. The agreement to sell Ext. PW-6/A, if proved on record, has to be treated qua sale of the land bearing Kh. No. 362 to the extent of the share of defendant No. 1 i.e. ½ share. Learned trial Judge has appreciated the evidence available on record in its right perspective while deciding this part of the controversy. The plaintiff, as such, is not justified to claim that by virtue of some family settlement, defendant No. 1 had become owner of the entire suit land particularly when no evidence qua partition thereof has been produced in evidence. There is also no evidence to show that on the day of execution of agreement to sell Ext. PW-6/A i.e. 11.2.1999, partition had already taken place. The entries in the jamabandi, Ext. PW-2/A prevalent at the time of execution of the agreement rather reveals that the plaintiff was only a co-sharer to the

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extent of ½ share in the suit land. This document has been issued on 30.11.1999 i.e. much after the execution of agreement to sell Ext. PW6/A.

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Now, if coming to substantial question of law numbered as (b) supra, it is the specific case of the plaintiff that on the day of execution of agreement to sell Ext. PW-6/A, he was put in possession of the suit land. The execution of the agreement stands proved on record and even both the Courts below have concluded that this document has been executed by defendant No. 2 in favour of the plaintiff. While, learned trial Court has decreed the suit for specific performance of the agreement i.e. Ext. PW-6/A, against the defendant and directed him to execute the sale deed of his ½ share in the land bearing Kh. No. 362, learned lower appellate Court has reversed such findings and formed an opinion that the plaintiff was not ready and willing to perform his part of the contract. The findings so recorded by learned appellate Court are farfetched and contrary to the evidence available on record. The plaintiff and the witnesses he examined have stated in one voice that the possession of the suit land was delivered to the plaintiff by defendant No. 1 at the time of execution of the agreement to sell Ext. PW-6/A. Reference to this effect can be made to the evidence as has come on record by way of the testimony of PW-3 Vijay Nand, PW-4 Padam Dass, PW-5 Prem Singh, PW-7 Bahadur Singh and PW-8 Kushal Singh. All have stated in one voice that it is the plaintiff who was in possession of the suit land. PW-6 Jita Singh is the scribe of

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Ext. PW-6/A and as per his version also, defendant No. 1 at the time of execution of the agreement had admitted the possession of the suit land having been delivered to the plaintiff. True it is that defendant No. 1 while in the witness-box as DW-3 has come forward with the version that prior to the sale of the suit land to defendant No. 2 Negi Ram, it is he who was in possession of the suit land. The possibility of he having deposed falsely to harass the plaintiff cannot be ruled out because when the agreement to sell Ext. PW-6/A stands proved on record and the factum of delivery of possession of the suit land finds recorded therein, it is not understandable as to how such recitals in this document could have been ignored by learned lower appellate Court. It is well settled that a person may depose falsely but not the document.

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Now, if coming to the version of DW-2 Pyare Lal, the possession of the suit land was given to defendant No. 2 Negi Ram in his presence by way of digging the same with a shawal (machine). When cross-examined, he has disclosed Kh. No. of the suit land as 156 (old), however, when further cross-examined, as to what is the Kh. No. of his own land, he failed to answer the same, meaning thereby that he was a tutored witness as it is difficult to believe that a person remembers the khasra numbers of the land of others but not that of his own land. PW-4 Darshan Dass also seems to be a liar because as per his own testimony in cross-examination, he visited the suit land 4-5 years ago. How he could have said about delivery of the possession thereof by defendant No. 1 to defendant No. 2 ? Learned trial Court

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has appropriately taken note of the facts such as his statement was recorded on 2.6.2001 and as such he should have visited the suit land somewhere in the year 1996-97. Therefore, he had no occasion to witness the delivery of possession thereof on 18.11.1999 when the sale deed Ext. PW-2/B was executed.

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Interestingly enough, as per the version of defendant No. 2 Negi Ram, the possession was delivered to him on 17.11.1999. When the sale deed Ext. PW-2/B was executed on 18.11.1999, there was no occasion to defendant No. 1 Puran Chand to have delivered the possession thereof to defendant No. 2 Negi Ram well before the execution of the sale deed. This Court, therefore, is satisfied that the delivery of possession of the suit land to the plaintiff by defendant No. 1 is duly proved, hence the findings so recorded cannot be said to be against the record and dehors the evidence at all.

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Now if coming to the substantial question of law numbered as (1) hereinabove in this judgment, defendant No. 1 cannot also be said to be a bonafide purchaser for the reason that in the joint statement he filed to the averments in the plaint, the agreement to sell Ext. PW-6/A allegedly was got executed by the plaintiff on misrepresentation of facts and taking undue advantage of mental state of defendant No. 2. Therefore, it would not be improper to conclude that defendant No. 2 Negi Ram had knowledge of the sale of the suit land by defendant No. 1 to the plaintiff by way of agreement to sell Ext. PW-6/A. He, as such, cannot be said to be a bonafide purchaser.

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Though the part performance of the contract by the plaintiff is again not covered under any of the substantial question of law, however, to adjudicate substantial questions of law under consideration, it is desirable to take note of the evidence available on record qua this aspect of the matter. Admittedly, a sum of Rs. 13,000/- towards sale consideration i.e. Rs. 35,000/- was received by defendant No. 1 on the date of execution of the agreement to sell Ext. PW-6/A. The execution of the affidavit Ext. PW-1/A also stands satisfactorily proved because defendant No. 1 has himself admitted his signatures thereon while in the witness-box. Otherwise also, PW-1, an official from the Office of Tehsildar Chirgaon, has produced record to substantiate this document. Since this record has been maintained by a public servant in the discharge of his official duties and produced in the Court by such official, therefore, its execution by defendant No. 1 cannot be at all suspected. This document lead to the only conclusion that the date i.e. 6.4.1999 when the same was executed, a sum of Rs. 30,000/- was received by defendant No. 1 from the plaintiff towards part payment of the sale consideration amounting to Rs. 35,000/-. The receipt Ext. PX (Mark ‘Y’), over which also the defendant No. 1 has admitted his signatures reveals that a further sum of Rs. 3200/- was received by the said defendant towards remaining sale consideration which was Rs. 5,000/- from the brother of the plaintiff. In this way, against sale consideration i.e. Rs. 35,000/- the plaintiff has paid Rs. 32,200/- to defendant No. 1 Puran Chand leaving thereby the balance

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i.e. Rs. 1800/-. The plaintiff has successfully pleaded and proved that he was always ready and willing to perform his part of the contract on payment of the balance sale consideration i.e. Rs. 1800/-. The findings to the contrary recorded by learned lower appellate Court are as such farfetched and contrary to the evidence available on record.

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Interestingly enough, as per the case of the defendants, the suit land was agreed to be sold by defendant No. 1 to defendant No. 2 for a sum of Rs. 69,000/-. The sale deed Ext. PW-2/B, however, reveals that the same was sold for a sum of Rs. 18,000/-. On this score also, the transaction of sale vide Ext. PW-2/B seems to be not genuine and rather to defeat the right of the plaintiff to get the sale deed executed in his favour. Defendant No. 2, therefore, cannot be said to be a bonafide purchaser by any stretch of imagination.

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In view of the above, on account of mis-appreciation and misrepresentation of the evidence qua delivery of possession of the suit land by defendant No. 2 to the plaintiff by learned lower appellate Court, the findings recorded are certainly vitiated. Learned lower appellate Court has absolutely erred legally and factually while holding that defendant No. 2 was a bonafide purchaser, therefore, on this score also, the findings as recorded being vitiated are not legally sustainable. The impugned judgment and decree as such, is not legally and factually sustainable, hence deserves to be quashed and set aside whereas judgment and decree dated 30.11.2002 passed by learned Sub

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Judge Ist Class, Rohru (Court No. II), in Civil Suit No. 91-1 of 1999 are affirmed.

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In view of what has been said hereinabove, this appeal succeeds and the same is accordingly allowed. Consequently, the impugned judgment and decree passed by learned lower appellate Court is quashed and set aside and that in Civil Suit No. 91-1 of 1999 by learned trial Court is affirmed. No orders as to costs.

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May 26, 2017, ( Dharam Chand Chaudhary ), (karan) Judge.

Vinod Kumar v. Negi Ram

Case brief

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Vinod Kumar v. Negi Ram

Case brief

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