Dismissed

Smt Lalitha v. Mrs T D Rathnamma

Karnataka HC14 Sept 2021RSA/765/2020

Case brief

AI extract

What is this about?

In a second appeal regarding specific performance of a sale contract, the court rejected the argument that lower courts erred in not framing an issue on readiness and willingness, holding the primary dispute was establishing whether the transaction was a sale or a repaid loan. Finding no substantial question of law, the appeal was dismissed.

What did the court decide?

No revision of lower court findings; the second appeal is dismissed for lack of merit and absence of substantial question of law.

Smt Lalitha Vs Mrs T D Rathnamma — Specific Performance | Karnataka HC (2021)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 14^TH DAY OF SEPTEMBER, 2021

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BEFORE

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THE HON'BLE MR. JUSTICE H.P. SANDESH

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R.S.A.NO.765/2020 (SP)

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BETWEEN:

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SMT. LALITHA W/O K.P.SURESH AGED ABOUT 53 YEARS

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K.P.SURESH S/O PUTTEGOWDA AGED ABOUT 58 YEARS

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K.S.ASHRITH GOWDA S/O K.P.SURESH AGED ABOUT 28 YEARS

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K.S.SUSHRITH S/O K.P.SURESH AGED ABOUT 26 YEARS

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ALL ARE R/AT KATRAMANE VILLAGE, THALIHALLA POST CHIKKAMAGALURU TALUK-577 130. … APPELLANTS

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[BY SRI SACHIN B.S., ADVOCATE]

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AND:

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MRS.T.D.RATHNAMMA W/O SHANTHE GOWDA AGED ABOUT 57 YEARS

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R/AT BHAKTHARAHALLI VILLAGE MALLENAHALLI POST CHIKKAMAGALURU TALUK AND DISTRICT – 577 130. … RESPONDENT

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THIS R.S.A. IS FILED UNDER SECTION 100 OF CPC AGAINST THE JUDGMENT AND DECREE DATED 27.11.2019 PASSED IN R.A.NO.53/2019 ON THE FILE OF THE PRL. SENIOR CIVIL JUDGE AND CJM, CHIKKAMAGALURU AND ECT.

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THIS R.S.A. COMING ON FOR ADMISSION THIS DAY, THE COURT DELIVERED THE FOLLOWING:

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J U D G M E N T

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This appeal is listed for admission. Heard the learned counsel appearing for the appellants.

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This appeal is filed challenging the judgment and decree dated 27^TH November 2019 passed in R.A.No.53/2019 on the file of the Senior Civil judge and JMFC, Sidlaghatta.

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The factual matrix of the case is that the plaintiff has filed a suit in O.S.No.23/2016 seeking the relief of specific performance of contract contending that the defendants have agreed to sell the suit schedule property in favour of the plaintiff for a total consideration of Rs.4,00,000/-. It is also the

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contention of the plaintiff that on the date of the agreement, she has paid a sum of Rs.3,00,000/- to the defendants as advance sale consideration and agreed to pay the balance sale consideration of Rs.1,00,000/- on the date of the execution of the registered sale deed.

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In pursuance of the suit summons, the defendants

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have appeared through their counsel and filed written statement contending that they have availed a loan of Rs.3,00,000/- from the plaintiff and they have executed a registered sale agreement as security for the repayment of the said loan. It is also the contention of the defendants that they have repaid the entire amount to the plaintiff which was availed by them as loan.

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After considering the pleadings of the parties, the

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Trial Court framed the issues with regard to the execution of the sale agreement and also the advance payment of Rs.3,00,000/and the plaintiff has to prove the agreement of sale as well as the advance payment of sale consideration. In view of the pleadings of the defendants, the Trial Court has also framed the issue whether they have availed a loan of Rs.3,00,000/- from

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the plaintiff and that the registered sale agreement is executed as security for the repayment of the said loan and whether the defendants have placed the material to show that they have repaid the loan amount of Rs.3,00,000/-.

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In order to prove the case of the plaintiff, she has examined herself as PW1 and one more witness as PW2 and got marked the documents at Ex.P1 to P6. On the other hand, the defendants have examined one witness as DW1 and no documentary evidence have been placed in support of their case.

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The Trial Court after considering the pleadings of the parties came to the conclusion that the said transaction is not a loan transaction as contended by the defendants and directed the defendants to execute the sale deed in favour of the plaintiff in respect to the suit schedule property within three months from the date of decree by receiving the balance sale consideration of Rs.1,00,000/- from the plaintiff.

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Being aggrieved by the judgment and decree of the Trial Court, the defendants have filed an appeal in

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R.A.No.53/2019. The first Appellate Court also on reappreciation of the material available on record had framed the four points for consideration whether the appellants have proved the transaction between them and the respondent has proved that the said transaction was only a money transaction and not with respect to the sale of any property and whether the suit is barred by limitation and the other contention with regard to whether the appellants have proved that the suit schedule property was mortgaged to the bank and hence, the specific performance relief cannot be granted and also whether the judgment and decree of the Trial Court suffers from any illegality or irregularity as contended in the appeal. The first Appellate Court also on re-appreciation of the oral and documentary evidence available on record answered all the points in the Negative and came to the conclusion that it is not a loan transaction as contended by the appellants and it is a sale agreement and dismissed the appeal. Hence, the present appeal is filed before this Court against the concurrent finding of both the Courts.

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The learned counsel for the appellants/defendants in his arguments vehemently contend that in a suit for specific performance of contract even if the appellants have not taken any defence that the respondent was not always ready and willing to perform his part of contract, it is a bounden duty of the Court to frame a issue invoking Section 16(c) of the Specific Relief Act, 1963. The counsel in support of his argument has relied upon the judgment of this Court reported in 2016 (3) AIR (Kar) (R) 836 and particularly, paragraph 38 of the said judgment wherein this Court has discussed regarding the Civil Court has to frame an issue with regard to Section 16(c) even if the defendant has not denied the readiness and willingness to perform the part of the contract of the plaintiff. The counsel also brought to the notice of this Court to paragraph 32 of the said judgment regarding proof of readiness and also proving the document by stepping into the witness box and that itself is not proved that he was having money to perform his part of contract and it is not in the sale form of currency but readiness throughout.

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The counsel also in his argument vehemently

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contend that no such issue has been framed by the Trial Court regarding readiness and willingness of the plaintiff to perform his part of contract. The counsel also vehemently contend that in order to prove the factum of readiness and willingness, he has to act upon in terms of the agreement and the same is not forthcoming in the evidence of the plaintiff. In support of his argument he has relied upon the judgment of the Apex Court reported in (2018) 0 SC 145 and brought to the notice of this Court to paragraph 19 wherein discussed with regard to the distinction between readiness and willingness to perform the contract. The readiness may be meant the capacity of the plaintiff to perform the contract which includes his financial position to pay the purchase price. For determining his willingness to perform his part of contract, the conduct has to be properly scrutinised. The factum of readiness and willingness to perform plaintiff’s part of contract is to be adjudged with reference to the conduct of the party and also brought to the notice of this Court to paragraphs 45 and 47 of the Report holding that there is nothing on record to show that the plaintiff

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could have made an arrangement for payment of the balance consideration amount to them. But on the other hand the Trial Court has recorded the finding of the fact to the effect that the correspondence between the parties would establish the fact that the plaintiff had money for the payment of balance sale consideration. The counsel also vehemently contend that both the Courts have not given any finding with regard to the hardship is concerned and Section 21(b) of the Specific Relief Act has not been complied and in absence of such finding both the Courts have committed an error in decreeing the suit of specific performance of contract and hence, it requires interference of this Court.

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Having heard the counsel for the appellant and also on perusal of the judgment of the Trial Court, no doubt that the Trial Court has not framed an issue with regard to readiness and willingness on the part of the plaintiff. So also the first Appellate Court also not considered the said issue but the Court has to look into the pleadings of the parties. On perusal of the sale agreement which is marked as Ex.P1 admittedly it is not in

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dispute that the sale agreement is a registered agreement. The sale consideration is also mentioned as Rs.4,00,000/- and out of that Rs.3,00,000/- was paid. The said averment is also not in dispute. But the claim of the defendants before the Trial Court is that the said transaction is only a loan transaction and not a sale transaction. The said document is obtained only as a security. It is also the defence of the defendants that they have repaid the entire amount of Rs.3,00,000/- to the plaintiff. In order to substantiate their contention that it was a security document and they have repaid the amount except the oral evidence of DW1 not a single scrap of paper was produced before the Trial Court to show that they have paid the amount of Rs.3,00,000/- to the plaintiff.

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It is also made to note that it is an undisputed fact

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that the time is mentioned for execution of the sale deed i.e., within three years from the date of the agreement dated 9^th May 2012. The said three years would be completed on 8^th May 2015. It is also not in dispute that the plaintiffs have issued a legal notice on 10^th April 2015 that is before completion of three

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years of the sale agreement. The defendants inspite of the receipt of the legal notice, they have not given any reply to the same and only in the written statement they took the defence that it is only a loan transaction and they have repaid the entire amount to the plaintiffs. Both the Courts have given the concurrent finding that it is a sale transaction. The defendants have not placed any material to show that the said transaction is a loan transaction and they have repaid the entire loan amount.

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The main contention of the appellant counsel that the findings of both the Courts are not correct. But in order to come to the conclusion that the defendants have entered into an agreement of sale and received an amount of Rs.3,00,000/- as a loan and the same was repaid noting is placed on record on behalf of the defendants. But the plaintiffs have examined one more witness as PW2 and the defendants have not disputed the fact that they have received a sum of Rs.3,00,000/- under Ex.P1 from the plaintiffs.

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The contention of the appellant counsel with regard to the readiness and willingness is concerned, he has disputed

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the said fact but in the plaint, a specific averment has been made that he is always ready and willing to perform his part of contract. But only the contention of the defendants that the Trial Court has not framed the issue with regard to the readiness and willingness of the plaintiffs to perform their part of contract. The counsel also brought to the notice of this Court to the judgment of this Court wherein this Court held that in order to comply with Section 16 (c), it is mandatory on the part of the Trial Court to frame an issue in this regard. But in the case on hand, it has to be noted that first of all it is not the contention of the defendants that the plaintiff has entered into a sale transaction but his defence is that it was only a loan transaction and not a sale transaction. It has to be noted that when the parties have understood the pleadings and led their evidence before the Trial Court and substantiated their contention placing the material on record, non-framing of issue invoking Section 16(c) is not a ground for admitting the second appeal and the same could not be entertained in the second appeal. When the parties have understood the pleadings and led their evidence and made out a case of the parties to meet the case by the

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parties and in the case on hand, it is not the case of the defendants that the plaintiff was not always ready to obtain the sale deed but the contention is that it was only a loan transaction. The specific defence is that the said document is only a loan document and the same is executed as security.

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The other contention of the appellants’ counsel that plaintiff was not having sufficient money and the same has not been proved. But the appellants have not disputed the fact that before the expiry of three years, the plaintiff has caused the legal notice on 10^th April 2015 that is prior to the expiry of three years as stipulated in the document at Ex.P1. The time is an essence of the contract under Ex.P1 and the legal notice was caused on 10^th April 2015 that is before the expiry of three years of the sale agreement and it is also made to note that inspite of receipt of the legal notice, no reply was given by the defendants and they have kept quiet and took up the defence in the written statement that it was only a loan transaction and not a sale transaction. When the plaintiff caused the legal notice before expiry of three years calling upon the defendants to execute the

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sale deed by receiving the balance sale consideration, the defendants now cannot contend that the plaintiff was not having any source to obtain the sale deed and when he was received the advance sale consideration and do not come forward to execute the sale deed, they cannot contend now that the plaintiff was not having money. It is not their case that they have not executed the document at Ex.P1 but their contention is that it is only a loan transaction and not a sale transaction. In order to substantiate their defence except examining one witness as DW1 who is also not the defendant and having any knowledge about the transaction whether the said transaction is a sale transaction or a loan transaction, nothing is placed on record. If really it is a loan transaction the defendant ought to have stepped into the witness box instead of examining the other witness on his behalf. Hence, the other contention of the appellant that there is no compliance of Section 21(b) also cannot be accepted. Under the circumstances, both the Courts have given concurrent findings in coming to the conclusion that it was a sale transaction and the defendants have not proved their defence and hence, I do not find any grounds to invoke Section 100 of

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CPC to frame substantial question of law. In the absence of substantial question of law with regard to material available on record and when the concurrent finding is given based on the material on record, I am of the opinion that there is no merit in the appeal to admit the second appeal and frame substantial question of law.

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In view of the discussions made above, I pass the

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following:

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ORDER

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The appeal is dismissed.

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Sd/JUDGE

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Smt Lalitha v. Mrs T D Rathnamma

Case brief

What is this about?

What did the court decide?

Smt Lalitha v. Mrs T D Rathnamma

Case brief

What is this about?

What did the court decide?

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