Allowed

Sri Gopalappa S/O Sri.Munidasappa v. Smt Muniyamma W/O Late Sri.Naryanappa

Karnataka HC26 Nov 2020RSA/21/2007

Case brief

AI extract

What is this about?

Suit for specific performance of an agreement to sell executed by the widow of the deceased owner and the earlier purchaser. The trial court and first appellate court refused relief. The High Court, finding the earlier agreement novated by the second agreement and the plaintiff ready and willing, decreed the suit for specific performance and directed refund of the excess paid to clear the bank loa

What did the court decide?

Appeal allowed; judgments and decrees of the trial court and first appellate court set aside; suit decreed as prayed for. Defendants to execute the registered sale deed within three months; plaintiff

Sri Gopalappa S/O Sri.Munidasappa Vs Smt Muniyamma… — Specific Performance | Karnataka HC (2020)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 26^TH DAY OF NOVEMBER, 2020

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BEFORE

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THE HON’BLE MR. JUSTICE N.K.SUDHINDRARAO

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R.S.A.No.21/2007

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BETWEEN:

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Sri Gopalappa Aged about 59 years S/o. Sri Munidasappa Resident of Bhaktharahalli Kasaba Hobli, Hosakote Taluk Bangalore Rural District - 562114

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...Appellant

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(By Sri.G.Papireddy, Advocate Appeared through physical hearing)

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AND:

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Smt. Muniyamma Aged about 70 years W/o. late Sri Narayanappa

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Bhaktharahalli Village Kasaba Hobli Hosakote Taluk Bangalore Rural District – 562114

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Smt. Saraswathi Aged about 60 years W/o. Sri. G.Krishna No.188/2, Muniswamappa Road Ulsoor, Bangalore – 560 008

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…Respondents (By Sri.G.R.Laxmipathy Reddy, Advocate for R1

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Appeared through physical hearing; V.O.Dt.30.08.2011 Service of notice to R2 is Held sufficient)

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This RSA is filed u/S 100 of CPC., against the judgment and decree dated:12.9.2006 passed in R.A.No.20/2002 on the file of the Presiding Officer, District and Sessions Judge, FTC-II, Bangalore Rural District and Bangalore, dismissing the appeal filed against the judgment and decree dt.8.4.2002 passed in O.S.No.226/92 on the file of the II Addl. Civil Judge (Sr.Dn.), Bangalore Rural District, Bangalore.

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This RSA Coming on for hearing this day, the Court delivered the following:

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JUDGMENT

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Appeal is directed against the judgment and decree dated 12.9.2006 passed in R.A.No.20/2002 on

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the file of District and Sessions Judge, FTC-II, Bangalore Rural District, Bangalore, wherein the appeal came to be dismissed by confirming the judgment and decree passed in O.S.No.226/1992 dated 08.4.2002 by II Additional Civil Judge (Sr.Dn.), Bangalore Rural District, Bangalore.

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2. The appellant herein is one Gopalappa, he

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is the plaintiff before the trial court and also the appellant before the First Appellate Court.

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In order to avoid confusion and overlapping the parties are referred as per their names and rankings held by them before the trial Court.

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The facts of the case have two limbs, wherein the first set of facts related to sale agreement dated 17.11.1985, wherein one Narayanappa agreed to execute the registered sale deed in favour of defendant No.2 – Saraswathi and second set of fact related to sale agreement dated 14.03.1991.

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The details of the said agreement dated 17.11.1985 are, the schedule property was agreed to be sold for a cash consideration of Rs.70,000/- and out of which, the purchaser – Saraswathi paid an advance amount of Rs.40,000/-, it was agreed by the

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parties that the purchaser – Saraswathi had to pay the remaining sale consideration of Rs.30,000/- at the time of execution of the registered sale deed within the time limit of three months from the date of agreement dated 17.11.1985. Meanwhile, the deal between the parties did not prosper by completion. Narayanappa – the seller under the agreement died during the year 1990. It is stated that his wife – Muniyamma is the only legal heir or survivor of deceased Narayanappa. As the agreement did not prosper, Saraswathi - the purchaser of the schedule property under the agreement approached Smt.Muniyamma wife of Narayanappa for return of advance amount as the former was not able to get registered the sale deed by paying remaining sale consideration. Meanwhile, it is stated that Muniyamma had no money. It was at this juncture, both the purchaser under the agreement – Smt. Sarswathi and

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widow of Narayanappa – Smt. Muniyamma had offered the schedule property to be sold to one Gopalappa son of Munidasappa who is the plaintiff. With this background, Gopalappa agreed to purchase the schedule property for a cash consideration of Rs.70,000/and paid an advance amount of Rs.15,000/-. It is stated that the said amount of Rs.15,000/- was handed over to Smt. Saraswathi -

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the original purchaser, with this pleadings, an agreement came into existence on 14.03.1991.

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For the sake of convenience, the second phase of facts have to be addressed. The balance sale consideration which the plaintiff – Gopalappa payable was Rs.55,000/- (sale consideration is Rs.70,000/-) and advance amount of Rs.15,000/- was paid under the sale agreement. In the background of the above facts, another development had taken place i.e., late

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Narayanappa husband of Muniyamma had borrowed loan from State Bank of India by mortgaging the schedule property and the banker – State Bank of India had filed a suit in O.S.No.162/82 against the Narayanappa and that came to be decreed and total decreetal amount was Rs.1,05,000/-.

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The ironical part of the agreement is the sale consideration was Rs.70,000/- and plaintiff paid an advance money of Rs.15,000/- and the balance sale consideration payable by plaintiff was Rs.55,000/-. But the liability on the property itself had gone up to Rs.1,05,000/-. It is stated that the execution was launched in Ex.No.121/1996. The plaintiff-Gopalappa in order to save the sale of land by decree holder – SBI, he paid a sum of Rs.1,05,000/ to SBI, wherein liability came to be ended. Now, summing up of facts is as under:

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Originally, Naryanappa entered into sale

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agreement with Smt. Saraswathi dated 17.11.1985 for a sale consideration of Rs.70,000/- and the time limit

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for registration of the said agreement was three months and the purchaser – Saraswathi paid an advance amount of Rs.40,000/-.

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It appears, both the seller and the purchaser were not serious in going ahead with the agreement. Meanwhile, the seller- Narayanappa died during the year 1990. It has to be remembered that the sale agreement between Narayanappa and Smt.Saraswathi is dated 17.11.1985 and three months time limit mean that due date would have been 17.02.1986. But Naryanappa died and it appears the parties also had their own difficulties. The purchaser – Saraswathi approached Smt. Muniyamma who is the legal heir and survivor of Narayanappa to give back the advance amount. But the said

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Muniyamma had no funds and both of them i.e, purchaser – Saraswathi and wife of deceased vendor went to the plaintiff and appraised him of the situation and they agreed to sell the schedule property for the same amount of Rs.70,000/- on 14.03.1991. After entering into agreement, it was the plaintiff – Gopalappa who purchased the said land and who was entitled to get the registered sale deed in his favour. Meanwhile, liability stated above from State Bank of India payable by Narayanappa incurred on the security of the schedule property came into picture and the plaintiff – Gopalappa had paid the amount to save the sale of the property. With this, the learned trial judge has framed the following issues and additional issue:

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“1. Whether the plaintiff proves that the defendants 1 and 2 executed an agreement to sale on 14/3/1991 by receiving an advance of Rs.15,000/-

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agreeing to sell the plaint schedule property to the plaintiff?

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2. Whether the plaintiff proves that he was always ready and willing to perform his part of the contract?

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3. Whether the plaintiff proves that he is entitled to specific performance of the agreement to sale dated 14.03.1991?

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4. Whether the plaintiff proves that he is entitled to an order of permanent injunction restraining defendants from alienating or meddling with the suit schedule property?

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5. What order or decree?

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Addl. Issue No.1 –Whether the 2^nd defendant proves that the plaintiff has failed to obtain the required sale deed within the time prescribed and as per the terms of the agreement of sale dated 14.03.91 she is entitled for damages?

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The learned trial judge was accommodated

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with the oral evidence of PWs.1 to 4 and documentary evidence of Exs.P1 to P12 on behalf of the plaintiff and on behalf of the defendants oral evidence of DWs.1 and 2 and documentary evidence of Exs.D1 to D5 were produced.

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Learned trial Judge on the basis of the oral and documentary evidence answered the issues and additional issue in the negative. Ultimately, the

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learned trial judge dismissed the suit as stated above and the appeal preferred by the plaintiff in R.A.No.20/2002 also came to be dismissed against which present appeal is filed.

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Sri. G Papireddy, learned counsel for

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plaintiff submits that the contract or the contractual

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right was very much in existence and plaintiff was entitled for a decree.

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Further, the agreement between deceased Narayanappa and Smt. Saraswathi dated 17.11.1985 did not die. The two agreements in the context of the entire contractual relationship and the fact of the same are nothing but complimentary to each other and each never destroyed or nullified the other. There was no bar of limitation and sale consideration was paid by the plaintiff more than what was agreed and the mode of activities suggests that the plaintiff’s case would be ideal example of ready and wiling to perform his part of contract. The learned trial judge erred in understanding the scope of the case of the contractual relationship between the parties.

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Meanwhile, it is seen that the Muniyamma

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who is the wife of original vendor – Narayanappa not

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only admitted the agreement but also was eager to comply the contractual obligation. The sale agreement between plaintiff and the defendants is marked as Ex.P1 dated 14.03.1991, wherein the schedule property is the subject matter. The sale consideration was Rs.70,000/- and advance amount paid by the plaintiff was Rs.15,000/- and balance payable is Rs.55,000/- and the time limit under the sale agreement was five months. The other statistical details of the case are that the suit was filed on 30.09.1992 and was disposed of on 08.04.2002 and the substantial questions of law which are framed by this Court earlier on 17.10.2012 are as follows:

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a) Whether the Courts below are justified in not considering the admissions of the defendants 1 and 2, material evidence supporting the case of the plaintiff and undisputed documents in favour of the plaintiff, while denying the relief for specific performance?

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b) Whether the findings of the Courts below on execution of the agreement for sale, Ex.P-1 and readiness and willingness of the plaintiff to perform his part of the contract are perverse?

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c) Whether the courts below are justified in denying the discretionary relief despite discharging the loan liability of Rs.1,05,000/- to the State Bank of India, Hosakote Branch in the Execution Proceedings and payment of Advance amount of Rs.15,000/- under the Ex.P1, when the obligation of balance sale consideration under Ex.P-1 was only Rs.55,000/-?

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Further, this Court yet again framed

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additional substantial questions of law on 25.11.2020 which are as follows:-

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“ 1) Whether when a party to a Contract or Agreement to sell dies, could it be extended by legal heirs?

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2) Whether such legal heir and living party to a contract get rights over the

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schedule property to deal with their consent?”

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The above additional substantial questions

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of law are relating to rights of agreement when a party dies, devolution of contractual rights and liability are legal and natural.

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In this connection the entire estate of the owner of the property upon his death gets disposed of by way of rules of succession whether testamentary or interstate or other legal mode. Estate includes contractual rights as well. Insofar as, the original sale agreement dated 17.11.1985 is concerned, which was entered into by Narayanappa. Under the doctrine of devolution, the contractual dues and liability, the legal heirs are entitled to get the property. However, in case, devolution of liability is concerned, the legal heirs are liable to discharge the liability of the deceased only to the extent of net assets inherited by

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them. On the other hand, there is no personal liability or bias obligation. In this connection, the trial Court observes the written statement of the first defendant Smt.Muniyamma, W/o Narayanappa is complete denial. She denies previous sale agreement stated to have been entered into by her husband dated 17.11.85 and also present sale agreement dated 14.03.1991.

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Paragraph 5 of the written statement of first defendant is as under:

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“5. The averments made in para-5 of the plaint that the first defendant’s husband had entered into an agreement of sale with second defendant are all concocted, baseless, made with ulterior and oblique motives in collusion with the second defendant and the defendants 1 and 2 had entered into an agreement to sell the schedule property to the plaintiff are all

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false, frivolous and the second defendant is an utter stranger to the family of the first defendant. The averments in para-5 to the effect that the husband of first defendant has raised a loan from the State Bank of India, Hoskote is hereby admitted as correct. The plaintiff is filed this suit with a malafide intention of knowing off the property of this poor widow. The first defendant has not executed any agreement to sell either to the plaintiff or to anybody else and she has no intention to sell the schedule property. The suit document No.1 is concocted, forged document, created by the plaintiff in collusion with second defendant.”

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Insofar as second defendant is concerned

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she almost admits the claim of the plaintiff regarding first and second agreement of sale.

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Evidence of PW-1 plaintiff-Gopalappa, PW2- K.Shivajirao, Advocate who has issued reply notice. PW-3 – R.Krishnaiah –attestor and PW-4M.Venkataswamappa and in the totality of circumstances following points are amply clear. Narayanappa was the owner of the property at a given point of time and there is no dispute to it. First defendant -Smt.Muniyamma is his wife sole successor and sole legal heir. Sale agreement dated 17.11.1985 was stated to have been entered into between Narayanappa, husband of first defendant and Saraswathi, second defendant. The said agreement did not see the light of the day as Narayanappa was dead, besides the purchaser was not showing interest to get the registered sale deed. It is in this connection the first defendant and second defendant approached the plaintiff. By this what could be inferred is that first defendant placed the second

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defendant for her company in the matter relating to sale of schedule property. In this connection Ex.P-7 reply notice issued on behalf of both the defendants by Advocate ShivajiRao and it is clear that the first sale agreement formality was totally admitted. In this connection contents of the said reply notice is necessary to be mentioned and it reads as under:

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“Under instructions from my client Smt.Muniyamma wife of Late Narayanappa, residing at Bakthar Halli, Hoskote Taluk, and Smt.Sarawathi Wife of G.Krishnan, residing at No.18/2, Muniswamappa Raod, Ulsoor, Bangalore -8 this notice is addressed to you as follows:-

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My client states that the husband of the 1^st of my client late Narayanappa was the absolute owner of land measuring 3 acres 19 guntas in Sy.No.150 of Bakthar Halli, Kasaba Hobli, Hoskote Taluk and he was in physical possession and enjoyment

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of the same. The said Narayanappa had entered into an agreement of sale with the 2^nd of my client Smt.Saraswathi on 17.11.1985 and had agreed to sell the said land for a sum of Rs.70,000/- and in that connection he had received Rs.47,500/- from the 2^nd of my client. As major portion of the sale consideration was paid, Smt.Swaraswathi, the 2^nd of my client, had been put in actual physical possession of land enjoyment of the said lands on the date of the agreement itself. Thus, my client Smt.Swaraswathi is in actual physical possession and enjoyment of the said land in part performance of the agreement to sell.

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My clients further state that as the State Bank of India had filed a suit against Naryanappa and after its

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dismissal the bank had preferred an appeal and the same was pending before the Addl. District and Sessions Judge, Bangalore District, Bangalore, it was specifically agreed by late Narayanappa that he shall execute the registered sale deed in favour of the 2^nd of my client Smt.Swaraswathi, immediately after the disposal of the appeal pending.

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The 1^st of my client Smt.Muniyamma had joined the 2^nd of my client Smt.Swaraswathi in confirmation of the sale agreement.

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My clients further state that one Sri Rama Reddy, Village Accountant, collusions with you and others by threatening my clients obtained signature to a document purported to be an agreement of sale, in your favour. My client had no intention to enter into any agreement and they

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had visited the Village Accountant Rama reddy in connection with rectification of Pahani. The said agreement obtained with the connivance of the village accountant Rama Reddy is fraudulent one and the same is illegal and does not confer any right in your favour, in as much as, my clients state that both yourself and village accountant have cheated my client in obtaining an agreement of ale, as the value of the land of Sy.No.150 of Baktharahalli is more that Rs.1,50,000/-. The agreement of sale obtained for a sum of Rs.70,000/- under threat, coercion does not confer any right on you and my clients reserve their right to proceed against your and the said village accountant both in civil and criminal proceedings. Hence, the telegram issued by you cannot give any right of specific performance of the alleged agreement. My clients

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are not obliged to execute any sale deed or document in your favour.

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In the above circumstances, my clients repudiate the agreement dated 14.03.1991 obtained by your under the said fraudulent circumstances with the connivance of the village accountant when my clients are not liable to execute any sale deed and deposite this notice, if any interference or any action were to be taken, the same would be resisted holding you responsible for all costs and consequences thereof”.

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The evidence of PW-2 –ShivajiRao, PW-1plaintiff, PW-3 and PW-4 attestors and reading of the notice in full amply makes clear there was a definite intention of first defendant joining the second defendant in executing said sale agreement and it was executed and denial of the second agreement by the

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defendant No.1 appears to be denial for the sake of denial without there being any substance in it.

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Trial court while answering issue No.1 and additional issue No.1 in paragraph 10 of the Judgment has observed as under:

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“10. Issue No.1 @ Addl. Issue No.1:- These issues are taken together for consideration. In order to prove the case of the plaintiff, the plaintiff himself got examined as PW.1 and three witnesses as PWs.2 to 4 and got marked Ex.P1 to P12 documents. Now the court has to see whether the plaintiff is able to prove his case has made out in the plaint. Gopalappa plaintiff PW.1 spoken before the court whatever averred in his plaint stating that Sy.No.150 total measuring 6 acres 37 guntas out of which in the family partition between his father and brother in the said survey number 3 acres 18 guntas of land fallen to share of his father and 3 acres 19

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guntas fallen to share of his uncle Naryanappa and go mutated his name to the land fallen to the share of his father and his uncle died in the year 1990 issue less. He is cultivating the land fallen to his uncle share. Further he has spoken that during the life time of his uncle Naryanappa he entered into an agreement to sell the suit land for Rs.70,000/- in favour of defendant No.2 and by receiving Rs.47,000/- he executed agreement to sell in favour of the defendant No.2 and he came to know the said fact after the death of his uncle. During the life time of his uncle, himself, his uncle and defendant, No.1 were in cordial terms and he performed the funeral ceremony of his uncle. Further he has stated that defendants 1 and 2 jointly agreed to sell the suit land to him for Rs.70,000/- and by receiving advance of Rs.15,000/-, they have executed the agreement of sell on 14.10.1991 as per Ex,P1 in the presence of witnesses and in the presence of husband

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of defendant No.2 and they have signed on the said document Ex.P1. Further he speaks that he paid Rs.15,000/- advance in the hand of Bhaktarahalli Krishnappa in turn he paid to defendant No.1 and there is mention in respect of the earlier agreement in favour of defendant No.2 in Ex.P1 and it was agreed that within five months the defendant No.1 has to produce the encumbrance certificate and by taking balance amount she has to execute the sale deed. But inspite of that they have not produced encumbrance certificate nor executed the sale deed. So he got issued the legal notice to defendants through his adv. as per Ex.P2 and he had produced the postal receipts at Ex.P3 and P4 demanding to execute the sale deed by receiving the balance consideration amount. He has also produced the telegram sent receipts at Ex.P5 and Ex.P6 and thereafter defendants have replied to the notice of PW.1, the said reply notice is marked at Ex.P7 and postal cover is marked as Ex.P8. Further he

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speaks regarding filing of the partition suit against the defendant No.1 in O.S.No.991/92 before the Munsiff at Hoskote and the suit land is not included in the said suit. Further he speaks regarding Ex.P9 and Ex.P10 RTC extracts and Ex.P11 and Ex.P12 tax paid receipts. Except this PW.1 has not all spoken before the court on which date sale talks took place, in whom presence sale talks took place and what purpose defendant No.1 intended to sell the suit land in his favour. On the other hand, the defendant No.1 has specifically denied regarding execution of this alleged agreement of sale neither in favour of the plaintiff nor in favour of the defendant No.2 by herself and her husband. In view of the denial of the execution of the alleged both agreements it is heavy burden on the plaintiff not only he has to prove the alleged agreement executed in his favour, he has to prove the earlier agreement executed by deceased Narayanappa in favour of the defendant

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No.2. Since the plaintiff got executed the alleged agreement of sale from the defendants 1 and 2 jointly. Though the defendant No.2 has no independent right over the suit land admittedly the suit land is fallen to the share of the husband of the defendant No.1 in the family partition and after the death of his uncle Narayanappa, the defendant No.1 being the sole heir to the deceased Narayanappa succeeded to the suit property. It is strange to note here that the contention of the plaintiff is that in the year 1985 deceased Naryanappa agreed to sell the suit property in favour of defendant No.2 for Rs.70,000/- in his favour. Even after six years of first agreement market value of the land cannot prevail at same rate. Plaintiff stated that in 1991 defendants agreed to sell suit land for Rs.70,000/-. So this shows that there is something fishy in the alleged transaction and the PW.1 has never spoken that as per the earlier agreement of sale defendant No.2 was in possession and after execution

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of the agreement of sale in his favour by the defendant No.1 and 2 he took possession of the suit land from the defendant No.2. On the other hand his case is that he is in possession and cultivating the suit land during the lifetime of his uncle Narayanappa. In the crossexamination he has clearly stated that the agreement of sale executed by his uncle in favour of defendant No.2 was shown to him and it was in Kannada language and defendant No.2 taken back the said document. He does not know the contents of the said agreement. Further defendant No.2 has produced the said agreement before the court at Ex.D5 it discloses that the same was written in English not in Kannada, so the plaintiff does not know anything about the earlier agreement. But he denied that himself colluding with the defendant No.2 created the agreement. Further in the cross-examination he has stated that prior to writing Ex.P1 no sale talks took place, without sale talks how

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they have written Ex.P1 agreement is doubtful and the evidence of PW.1 is not believable one. Further he admits that bank has filed a suit against his uncle regarding recovery of the loan amount. His uncle mortgaging the suit land in favour of the bank had obtained the loan and final decree proceeding was pending before the Civil Judge and it is ordered to auction the suit land. When he know all the facts that his uncle by mortgaging the suit land in favour of the bank obtained the loan, but there is nothing mentioned in the alleged agreement Ex.P1.”

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The appellant court in paragraphs 16 and 18

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of the Judgment has observed as under:

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“16. It is an admitted fact that, late Narayanappa had raised loans from State Bank of India, Hoskote by mortgaging the suit schedule property and that, the suit filed by the State Bank of India against Narayanappa came to be decreed against

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him and that, the suit schedule property was attached in execution of the decree passed in the said suit. The alleged agreement of sale (Ex.P1) does not refer to this matter. This aspect also raises serious doubt about the execution of agreement of sale (Ex.P1) by the 1^st defendant.”

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The learned trial Judge has dealt with all these aspects elaborately and has come to a right conclusion in dismissing the suit of the plaintiff. I find absolutely no grounds to interfere with it. The learned counsel for the appellant-plaintiff has relied upon the decisions in the case of Mathew Jacob and others Vs Ms.Salestine Jacob and another, reported in AIR 1998, DELHI 390 and in the case of M.S.Thanigachala Pillai Vs Rukmani Ammal and others, reported in AIR 1989, MADRAS 99, wherein both the decisions pertain regarding mode of proof of Will. The observations made in both the decisions are not at all applicable to the facts of the case on hand.”

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Insofar as entitlement of the sale

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agreement and its right, liability and related are concerned the best way of discharging of contract is by performance itself. When a party to a contract dies before the performance, the liability would devolve upon legal heirs of the deceased subject to the rule that there cannot be monetary liability more than the value of the net assets inherited by the legal heir. Thus, when Smt.Muniyamma was not in a position to refund the advance amount of Rs.40,000/- and Saraswathi was also in difficulty to get balance amount for the registration and stamp duty, the act of Saraswathi the second defendant and first defendant

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joining together to sell the schedule property and to appropriate the amount among them and said act or circumstances appears fully probable and probability force nullifies the denial by first defendant. Insofar as

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consideration is concerned Section 2(d) of the Indian Contract Act defines consideration as under:

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“When, at the desire of the promisor, the promisee or any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, something, such act or abstinence or promise is called a consideration for the promise.”

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It may be past, present or future, which

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means when Narayanaswamy during his life time has received Rs.40,000/out of Rs.70,000/and subsequent conduct of first defendant definitely reveal that there was agreement without any doubt and for the reasons stated above defendants 1 and 2 joined together to execute the registered sale deed. This becomes amply clear from the reply notice issued by PW-2 –K.ShivajiRao, Advocate and Ex.P-1 sale

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agreement and evidence of attestors. Here one aspect has to be looked into when the first set of facts regarding agreement dated 17.11.85 is admitted and in the second agreement when defendants 1 and 2 participated in execution of sale agreement it does not take any amount of paying or calculation that first agreement has resulted in new agreement. As a matter of fact it also comes under Doctrine of Novation . Change of terms, change of parties as defined under the Indian Contract Act. Thus, there is no any kind of impediment for accepting the sale agreement executed by non legal heir, non survivor in the family of Narayanappa and Smt.Muniyamma, the widow of Narayanappa. Effect of novation as per Section 62 of the Indian Contract Act is as under:

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“62. Effect of novation, rescission, and alteration of contract – If the parties to a contract agree to substitute a new contract

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for it, or to rescind or alter it, the original contract need not be performed.”

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Now the arithmetical part of the case is that first sale agreement total sale consideration agreed was Rs.70,000/-, advance amount paid Rs.40,000/- by Saraswathi to Narayanappa balance payable Rs.30,000/-. That did not happen. Second sale agreement was entered into by Smt.Muniyammafirst defendant and Saraswathi-second defendant to sell the schedule property to the plaintiff for sale consideration of Rs.70,000/- and advance amount paid was Rs.15,000/balance payable was Rs.55,000/- time limit five months. The participation of Saraswathi –second defendant in executing the sale agreement was definitely necessary and does not pollute the nature of the sale agreement and suit. On the other hand her participation is definitely necessary. She is purchaser under earlier agreement

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and she has reminiscent of rights over the property and sale agreement and a sincere and prudent purchaser is bound to get the documents executed by both first defendant and second defendant and that has been done.

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The first sale agreement between

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Narayanappa and Saraswathi is a fine proof of second agreement between plaintiff-Gopalappa and Muniyamma and Saraswathi.

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The next portion is balance sale

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consideration payable by plaintiff to the defendants is Rs.55,000/-. Meanwhile it is brought to the notice of the court that there was a liability incurred by late Narayanappa by mortgaging the schedule property and State Bank of India had filed a suit in O.S.No.162/82 that came to be decreed and same sought to be executed in Ex.No.121/96 wherein

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decreetal amount of Rs.1,05,000/- was paid by the plaintiff to prevent the schedule property from being sold away in auction. The documents are produced in this connection.

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Appellant has made an application I.A.2/2007 under Order 41 Rule 27 of CPC for production of four documents. They are as under:

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Document No.1 is original challan dated 18.06.2004 issued by the State Bank of India, Hosakote Branch, for having remitted the sum of Rs.1,05,000/-.

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Document No.2 – Original Loan Clearance Certificate dated 1-06-2004 issued by the State Bank of India, Hosakote Branch.

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Document No.3 – Certified copy of the Notice issued under order XXI Rule 64 in Execution Case No.121 of 1996 and

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Document No.4 – Sale Notice published in Hosakote Pathrike.

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In the circumstances the said application/ documents helps in points of controversy involved in the case. I.A.2/2007 is allowed and documents are looked into.

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The plaintiff -Gopalappa who was basically responsible to pay the balance sale consideration of Rs.55,000/- had to pay Rs.1,05,000/- to the bank arithmetically Rs.50,000/-. The agreed price for the schedule property under the sale agreement is Rs.70,000/- amount paid by advance Rs.15,000/- and paid towards discharge of loan is Rs.1,05,000/-. Thus, the following calculation makes it clear advance amount of Rs.15,000/-, paid to bank Rs.1,05,000/-, total Rs.1,20,000/-. Sale consideration agreed Rs.70,000/-, cash paid Rs.50,000/-. Under the

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circumstances there is no covenant regarding

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existence of loan in the agreement nor there was any correspondence. However, in the agreement it is stated in addition to Rs.40,000/- what defendant No.2 paid earlier in the first agreement she also paid another amount of Rs.7,500/-. Thus, total payment under the first agreement is Rs.47,500/- regard being had to the fact that Rs.15,000/- advance paid by the plaintiff is paid to her. Thus, when statute is clear and in force it cannot be read against its language.

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The liability of the plaintiff to get the

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registered sale deed is Rs.55,000/- but he has paid Rs.1,05,000/-.

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Value of the Schedule property under 1^st agreement - Rs.70,000/Advance paid - Rs.40,000/7,500/-----------------

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(Rs.70,000-Rs.47,500/-) Rs.22,500/-----------------

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Agreement did not get performed.

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As a matter of fact Rs.50,000/- will have to be refunded to the plaintiff. The true form of recognition of right to the right could be presented in the following statement.

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Sale consideration under the first agreement dated 17.11.85 Rs.70,000/- purchaser Saraswathi seller Narayanaswamy advance amount Rs.40,000/-. Balance payable Rs.30,000/-. Agreement did not fructify and has paved way for second agreement. The effect of sale agreement would be Saraswathi, the purchaser would be entitled for refund of her amount of Rs.40,000/-. The details of second agreement dated 14.03.1991 sale consideration Rs.70,000/-. Advance paid Rs.15,000/- name of the purchaserGopalappa-plaintiff, seller–first defendant - Smt.Muniyamma, W/o late Narayanappa, second defendant-Saraswathi, purchaser under the first

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agreement who had paid amount of Rs.47,500/- as

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advance. Balance payable Rs.55,000/-.

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The same may be presented as under:

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The sale agreement dated 14.03.1991 Sale consideration Rs.70,000/Less: advance Rs.15,000/------------Balance payable Rs.55,000/------------

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But plaintiff had to pay Rs.1,05,000/- to

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Bank towards the clearance of loan on the schedule property. Thus plaintiff is entitled for refund of Rs.50,000/-.

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Amount paid because of the liability

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incurred on the schedule property make it a free hold property and amount paid by plaintiff to the decree holder-bank in Ex.No.121/96 Rs.1,05,000/-. Thus,

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apart from getting registered sale deed in his favour the plaintiff is also entitled for the refund of amount of

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Rs.50,000/-. The trial court erred in recognizing basic principle of devolution of contractual rights and liabilities, covenant of novation, liability of the parties, limit to the boundaries fixed under the statute. The reasoning assigned are arbitrary and perverse apart from that basic substantial questions of law regarding currency of the agreement, novation, right of purchaser from all angles so of the seller, the legal effect of enforceability of second agreement in the light of developments in first agreement are not considered.

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Substantial questions of law are answered accordingly.

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In the result, appeal is allowed. Judgment and decree dated 08.04.2002 passed in O.S.No.226/92 by trial court and Judgment and decree dated 12.09.2006

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passed in R.A.No.20/2002 by appellate court are

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hereby set aside. Suit is decreed as prayed for.

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Defendants are directed to execute the

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registered sale deed in favour of plaintiff within three months from the date of receipt of certified copy of this Judgment. Plaintiff is also entitled for the refund of amount of Rs.50,000/-. The first defendant - Smt.Muniyamma has to pay amount of Rs.50,000/- to the plaintiff. However from the estate if any she has inherited from her husband Narayanappa.

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Rs.50,000/- is payable by first defendantSmt.Muniyamma it cannot be held as personal liability. On the other hand it was incurred by her husband on the security of schedule property. In the result she would not be personally liable to pay amount of Rs.50,000/- it becomes payable from the

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estate of net assets of Narayanappa if any in the hands of first defendant.

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No order as to costs.

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Sd/JUDGE

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HJ/SBN

Sri Gopalappa S/O Sri.Munidasappa v. Smt Muniyamma W/O Late Sri.Naryanappa

Case brief

What is this about?

What did the court decide?

Sri Gopalappa S/O Sri.Munidasappa v. Smt Muniyamma W/O Late Sri.Naryanappa

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

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