Allowed

Smt v. Shelvi v Smt Bhagyamma

Karnataka HC17 Nov 2023RSA/238/2012

Case brief

AI extract

What is this about?

This second appeal allowed the appellant's claim for specific performance of a sale agreement for Rs.44,000. The High Court held that the lower courts erred in finding the appellant not ready and willing, noting a valid pre-expiry legal notice was issued. The appeal also observed that non-joinder of a non-signatory brother was not fatal.

What did the court decide?

Impugned judgment set aside; suit for specific performance decreed; defendants directed to execute registered sale deed within three months.

Smt v Shelvi Vs Smt Bhagyamma — Specific Performance | Karnataka HC (2023)

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1 - NC: 2023:KHC:41072 RSA No. 238 of 2012

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 17^TH DAY OF NOVEMBER, 2023

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BEFORE

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THE HON'BLE MR JUSTICE ASHOK S.KINAGI

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REGULAR SECOND APPEAL NO. 238 OF 2012

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BETWEEN:

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SMT. V. SHELVI W/O. K.V.VENKATESH AGED ABOUT 31 YEARS R/AT N.M.C.EXTENSION NEAR GANAPATHI TEMPLE, OLD TOWN, BHADRAVATHI

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…APPELLANT

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(BY SRI PRASANNA B.R., ADVOCATE)

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AND:

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SMT. BHAGYAMMA W/O. LATE KEMPU MODALIAR AGED ABOUT 60 YEARS

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Digitally signed by R DEEPA Location: High Court of Karnataka

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K. SHASHIKUMAR S/O. LATE KEMPU MODALIAR AGED ABOUT 29 YEARS

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K. MANOHAR S/O.LATE KEMPU MODALIAR AGED ABOUT 29 YEARS

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ALL ARE MAJORS, HINDU R/AT HALAPPA CIRCLE 7^TH CROSS, B.H.ROAD OLD TOWN, BHADRAVATHI.

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…RESPONDENTS

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(BY SRI M.S.NARAYAN, ADVOCATE FOR R1 TO R3)

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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THIS RSA IS FILED U/S. 100 OF CPC AGAINST THE JUDGEMENT & DECREE DTD 26.10.2011 PASSED IN R.A.NO.68/2008 ON THE FILE OF SENIOR CIVIL JUDGE AND JMFC, BHADAVATHI, DISMISSING THE APPEAL AND CONFIRMING THE JUDGEMENT AND DECREE DTD: 30.8.2008 PASSED IN O.S.NO.316/2006 ON THE FILE OF CIVIL JUDGE (JR.DN.) AND ADDITIONAL JMFC, BHADRAVATHI.

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THIS APPEAL COMING ON FOR FINAL HEARING, THIS DAY, THE COURT DELIVERED THE FOLLOWING:

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J UDGMENT

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This second appeal is filed by the appellant challenging the judgment and decree dated 26.10.2011 passed in R.A.No.68/2008 by the Civil Judge, JMFC, Bhadravathi, confirming the judgment and decree dated 30.08.2008 passed in O.S.No.316/2006 on the file of Civil Judge (Jr.Dn.) and Addl. JMFC, Bhadravathi.

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For the sake of convenience, parties are referred to as per their rankings before the trial Court. The appellant is the plaintiff and respondents are the defendants.

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Brief facts leading rise to filing of this appeal are as under:

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The plaintiff filed a suit for specific performance of contract against the defendants. It is the case of the plaintiff that the defendants are the absolute owners of suit schedule

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3 - NC: 2023:KHC:41072 RSA No. 238 of 2012

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property and they agreed to sell the suit schedule property in favour of the plaintiff for valuable consideration amount of Rs.44,000/- and the plaintiff paid a sum of Rs.10,000/- towards advance amount and defendants executed an agreement of sale in favour of the plaintiff on 13.09.2006. As per the terms and conditions of the agreement of sale, the defendants agreed to execute a registered sale deed within three months from the date of sale agreement in favour of the plaintiff along with one K. Ganesh who is the last son of defendant No.1. At the time of the execution of sale agreement, they promised to keep the presence of Sri. K. Ganesh and by believing their words, the plaintiff paid an advance of Rs.10,000/- as per agreement of sale. The plaintiff approached defendants to receive the balance consideration amount and to execute the Registered Sale Deed. But, the defendants went on dodging on one or the other ground. The plaintiff got issued a legal notice on 20.09.2006 calling upon the defendants to receive the balance consideration amount and to execute the registered sale deed. The notice was duly served on the defendants, but they failed to comply with the request made in the legal notice. Hence,

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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cause of action arose for the plaintiff to file the suit for specific performance.

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The defendant No.1 filed written statement denying the averments made in the plaint and also denied the execution of an agreement of sale dated 13.09.2006 and received advance amount of Rs.10,000/-. It is denied that the plaintiff was ready and willing to perform his part of contract. It is contended that the defendants had obtained a loan of Rs.10,000/- from the plaintiff in the month of September 2006. At that time, the plaintiff obtained signatures of defendants on blank bond papers and assured that she will return the said blank documents after realization of amount. But, the plaintiff retained the blank documents for her wrongful gain and hence, filed the present suit. It is contended that the suit is bad for non-joinder of necessary parties and hence prayed to dismiss the suit.

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The trial Court on the basis of pleadings of the parties framed the following issues:

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ªÁ¢AiÀÄÄ ¥ÀæwªÁ¢AiÀÄgÀÄ zÁªÁ ¸ÀévÀÛ£ÀÄß ªÀiÁgÁl ªÀiÁqÀ®Ä M¦à gÀÆ.10,000-00 ªÀÄÄAUÀqÀ ºÀt ¥ÀqÉzÀÄ ¢£ÁAPÀ

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5 - NC: 2023:KHC:41072 RSA No. 238 of 2012

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13.09.2006gÀAzÀÄ PÀæAiÀÄ M¥ÀàAzÀ PÀgÁgÀ£ÀÄß §gÉzÀÄPÉÆnÖzÁÝgÉAzÀÄ gÀÄdÄªÁvÀÄ ¥Àr¸ÀÄvÁÛgÉAiÉÄÃ?

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ºÁVzÀÝ°è D zÁR¯ÉGAiÀÄÄ vÀªÀÄä °TvÀ ºÉÃ½PÉAiÀÄ 7£ÉÃ ¥ÁågÁzÀ°è ºÉÃ½gÀÄªÀ ¸À¤ßªÉÃ±ÀUÀ¼À »£Éß¯ÉAiÀÄ°è ¸ÀÈ¶Ö¹PÉÆAqÀzÀÄÝ JAzÀÄ ¥ÀæwªÁ¢AiÀÄgÀÄ gÀÄdÄªÁvÀÄ ¥Àr¸ÀÄvÁÛgÉAiÉÄÃ?

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ªÁ¢ vÁ£ÀÄ vÀ£Àß ¨sÁUÀzÀ µÀgÀvÀÄÛUÀ¼À£ÀÄß ¥Á°¸À®Ä AiÀiÁªÀvÀÆÛ ¹zÀÞ¤zÉÝÃ£É JAzÀÄ gÀÄdÄªÁvÀÄ¥Àr¸ÀÄvÁÛgÉAiÉÄÃ?

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F zÁªÉAiÀÄÄ PÀQë£ÀÆå£À zÉÆÃµÀ¢AzÀ ¨Á¢üvÀªÁVzÉAiÉÄÃ?

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ªÁ¢AiÀÄÄ ¥ÀæwªÁ¢AiÀÄjUÉ £ÉÆÃAzÁ¬ÄvÀ PÀæAiÀÄ ¥ÀvÀæ §gÉzÀÄPÉÆqÀ®Ä ¤zÉÃð±À£À ¤ÃqÀÄªÀ ¥ÀjºÁgÀ ¥ÀqÉAiÀÄ®Ä CºÀðjzÁÝgÉAiÉÄÃ?

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ªÁ¢AiÀÄÄ ¥ÀAiÀiÁðAiÀÄ ¥ÀjºÁgÀªÁzÀ ªÀÄÄAUÀqÀ ºÀtzÀ ªÁ¥À¸ÁwAiÀÄ ¥ÀjºÁgÀ ¥ÀqÉAiÀÄ®Ä CºÀðjzÁÝgÉAiÉÄÃ?

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AiÀiÁªÀ DzÉÃ±À CxÀªÁ rQæ?

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The plaintiff in order to prove her case, examined herself as PW-1 and examined two witnesses as PW-2 and PW3 and got marked 5 documents as Ex.P-1 to Ex.P-5. In rebuttal, the defendants No.1 and 2 were examined as DW-1 and DW-2 and got marked 4 documents as Ex.D-1 to Ex.D-4.

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The trial court on assessment of the oral and documentary evidence, answered issue Nos.1, 4 and 6 in the affirmative and issue Nos.2, 3 and 5 in the negative and

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6 - NC: 2023:KHC:41072 RSA No. 238 of 2012

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consequently decreed the suit in part and dismissed the suit of the plaintiff in regard to the specific performance of contract and decreed the suit of plaintiff as regard to the relief of refund of advance sale consideration amount.

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The plaintiff aggrieved by the judgment and decree passed by the trial Court, dismissing the relief of specific performance preferred an appeal in R.A.No.68/2008 on the file of Senior Civil Judge & JMFC, Bhadravati.

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The First Appellate Court after hearing the parties

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framed the following points for consideration:

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Whether the plaintiff proves that the defendants have executed on agreement of sale in her favour agreeing to sell the suit schedule property for a sum of Rs.44,000/- by receiving advance sale consideration of Rs.10,000/on 13.09.2006?

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Whether the plaintiff further proves that she is ever ready and willing to perform her part of contract?

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Whether the defendants prove that they have put their signature on blank signed stamp paper when they borrowed loan of Rs.10,000/- from the plaintiff as a security, but the plaintiff got created suit document to have a wrongful gain?

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Whether the suit is bad for non-joinder of necessary parties?

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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Is there any necessity to intervene in the judgment and decree of the trial court?

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What Order?

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The First Appellate Court on re-assessment of oral and documentary evidence answered Point Nos.1 and 4 in the affirmative and Point Nos.2, 3 and 5 in the negative and consequently, dismissed the appeal with cost and confirmed the judgment and decree passed by the trial court. The plaintiff aggrieved by the judgments and decrees passed by the Courts below has filed this second appeal.

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This court admitted the appeal to consider the following substantial questions of law:

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Whether the trial Court and first appellate Court erred in considering the provisions of Section 22 of the Specific Relief Act?

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Whether the trial Court and first appellate Court erred in refusing the decree for specific performance?

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Whether the trial Court and first appellate Court were justified in ordering the total refund of money from the defendant when the agreement was executed by defendant and his brother?

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Whether another brother of the vendor K.Ganesh son of first defendant being not signing the agreement and he not being made

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8 - NC: 2023:KHC:41072 RSA No. 238 of 2012

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the defendant though referred in the agreement vitiated the proceedings?

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Heard the learned counsel for the plaintiff and

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learned counsel for the defendants.

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Learned counsel for the plaintiff submits that the defendant Nos.1 to 3 had agreed to sell the suit schedule property for valuable consideration. He submits that defendant Nos.1 to 3 have executed an agreement of sale in favour of the plaintiff. The plaintiff paid a sum of Rs.10,000/towards earnest money and agreed to pay the balance consideration amount at the time of execution of registered sale deed. He submits that though the plaintiff requested defendants to accept the balance consideration amount and to execute the registered sale deed, the defendants did not come forward to receive the balance consideration amount and execute the registered sale deed. The plaintiff got issued legal notice showing her readiness and willingness to perform her part of contract. The trial Court has answered issue Nos.1, 4 and 6 in the affirmative. When the trial Court recorded a finding that the plaintiff has proved the execution of an agreement of sale, the trial court ought to have decreed the

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9 - NC: 2023:KHC:41072 RSA No. 238 of 2012

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suit for specific performance of contract. On the contrary, the trial Court declined to grant a relief of specific performance of contract. He further submits that the trial court has not properly exercised the discretionary power under Section 20 of the Specific Relief Act. Further, he submits that the First Appellate Court has also committed an error in confirming the judgment and decree passed by the trial Court. Hence, on these grounds he submits that the Courts below have committed an error in passing the impugned judgments. Hence, on these grounds, he prays to allow the appeal.

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Per contra, learned counsel for the defendants submits that the transaction between the plaintiff and defendants is the loan transaction and it is not a sale transaction. The alleged agreement of sale is executed by defendants in favour of the plaintiff as a security for the purpose of repayment of loan. He submits that the agreement of sale is a nominal one and it was not to be acted upon. Hence, he submits that the Courts below were justified in passing the impugned judgments. He submits that the judgments and decrees passed by the Courts below does not

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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call for any interference. Hence, on these grounds, he prays to dismiss the appeal.

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Perused the records and considered the submissions

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of learned counsel for the parties.

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SUBSTANTIAL QUESTION NOS.1 TO 3 : Since these

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questions are interlinked, they are taken together common discussion in order to avoid repetition. The defendants are the absolute owners of the suit schedule property. The defendants agreed to sell the suit schedule property in favour of plaintiff for consideration of Rs.44,000/- and accordingly, the plaintiff paid a sum of Rs.10,000/- as an earnest money to the defendants and the defendants have executed an agreement of sale on 13.09.2006. As per the terms and conditions of the agreement, the defendants have to execute the registered sale deed within 3 months from the date of agreement of sale in favour of plaintiff along with Sri. K.Ganesh who is the last son of defendant No.1. The plaintiff requested the defendants to receive the balance consideration amount and execute the registered sale deed, but, the defendants went on dodging on one or the other ground. The plaintiff got issued legal notice

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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on 20.09.2006 to the defendants calling upon the defendants to execute a registered sale deed by receiving the balance consideration amount. The defendants replied the legal notice denying the execution of agreement of sale.

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The plaintiff examined herself as PW-1 and she has reiterated the plaint averments in the examination-in-chief and produced documents. Ex.P-1 is the agreement of sale dated 13.09.2006, executed by defendants in favour of plaintiff. Ex.P-2 is the legal notice dated 20.09.2006, got issued by the plaintiff to the defendants calling upon the defendants to receive the balance consideration amount and to execute a registered sale deed and further, the plaintiff has stated in the notice that the plaintiff was ready and willing to perform her part of contract and Ex.P-3 to Ex.P-5 are the acknowledgments. Further the plaintiff in order to prove that the defendants have executed an agreement of sale in favour of plaintiff, examined attesting witness i.e., R.Mani as PW-2. He has deposed in the examination-in-chief that the defendants have entered into an agreement of sale with the plaintiff with regard to the suit schedule property for consideration of Rs.44,000/- and the plaintiff paid a sum of

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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Rs.10,000/- as a token amount to the defendants and the defendants executed an agreement of sale on 13.09.2006 and it was agreed that the plaintiff should pay the balance consideration amount within a period of 3 months from the date of execution of an agreement of sale and further it was agreed that the defendants by receiving the balance consideration amount should execute the registered sale deed in favour of plaintiff. He identified his signature marked as Ex.P-1(d). Other than the plaint averments, nothing has been elicited from the mouth of this witness in the course of crossexamination. Further, the plaintiff has also examined one more witness as PW-3 by name Ganapati Rao, who is also a witness to Ex.P-1. He has deposed in the same line of PW-2 regarding the execution of agreement of sale in favour of plaintiff and his signature is marked as Ex.P-1(e). Nothing has been elicited from the mouth of this witness in the course of cross-examination.

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In rebuttal, defendant No.1 was examined as DW-1

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and she has reiterated the averments made in the written statement and denied the execution of an agreement of sale in favour of plaintiff and also denied the fact of receiving the

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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amount of Rs.10,000/- as an advance. It is contended that the defendants were in need of money and hence requested the plaintiff to advance a loan of Rs.10,000/- and on the request made by the defendants, the plaintiff advanced a loan of Rs.10,000/-. It is further deposed that the transaction between the plaintiff and the defendants is a loan transaction and not a sale transaction.

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In the course of cross-examination it was suggested to DW-1 that the defendants have agreed to sell the suit schedule property for consideration of Rs.44,000/- and the defendants have received amount of Rs.10,000/- as an advance. The said suggestion was denied and DW-1 has also denied the execution of an agreement of sale as per Ex.P-1. In support of their case, the defendants have produced documents. Ex.D-1 is the reply notice dated 24.11.2006, Ex.D-2 is the postal cover, Ex.D-3 is the Family Tree of Bhagyamma, W/o Kempu Mudaliar and Ex.D-4 is the death certificate of Kempu Mudaliar and further examined one witness as DW-2 who has deposed in the same line of DW-1.

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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From the perusal of record, it discloses that the defendants have executed an agreement of sale in favour of the plaintiff for sale consideration of Rs.44,000/- and the plaintiff has paid a sum of Rs.10,000/- towards part consideration amount. Further, the plaintiff has also examined attesting witness to Ex.P1. The defendants have not explained as to why the witnesses P.Ws.2 and 3 have deposed against the defendants. Further, the defendants have not pleaded any enmity with P.Ws.2 and 3. The Trial Court, after considering oral and documentary evidence, answered Issue No.1 in the ‘affirmative’ holding that the plaintiff has proved that the defendants have executed an agreement of sale in favour of plaintiff for sale consideration of Rs.44,000/- by receiving advance sale consideration of Rs.10,000/-. But, the Trial Court has dismissed the suit filed for the relief of specific performance of contract only on the ground that the plaintiff was not ready and willing to perform his part of contract. The Trial Court committed an error in recording the said finding and not properly appreciating the material on record.

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Though the agreement of sale came to be executed on 13.09.2006, as per the terms and conditions of the

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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agreement, the defendants agreed to execute the registered sale deed within three months from the date of agreement and before expiry of three months, the plaintiff got issued the legal notice on 20.09.2006 calling upon the defendants to receive balance consideration amount and to execute a registered sale deed. The said notice was duly served on the defendants. The defendants neither replied the legal notice nor received balance consideration amount and executed a registered sale deed. Thus, by issuing the legal notice before the expiry of time stipulated in the agreement of sale, the plaintiff has shown his willingness to perform his part of contract. But, the Trial Court has committed an error in recording a finding that the plaintiff has failed to prove that the he was ready and willing to perform his part of contract. The defendants have not challenged the findings recorded by the Trial Court on issue Nos.1, 4 and 6. The defendants have not challenged the findings on issue Nos.1,4 and 6. The said finding has attained finality.

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The plaintiff filed an appeal challenging the dismissal of suit for specific performance of contract. The First Appellate Court, on re-appreciating the oral and documentary evidence has affirmed the finding on readiness and willingness

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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of the plaintiff as recorded by the Trial Court. Even the First Appellate Court committed an error in recording the finding that the plaintiff was not ready and willing to perform his part of contract. As observed above, the plaintiff had issued legal notice calling upon the defendants to receive the balance sale consideration and to execute a registered sale deed, there was no reply from the defendants side. Thus, the plaintiff has proved the fact that he was/is ready and willing to perform his part of contract. Hence, the findings recorded by both the Trial Court and the First Appellate Court on the readiness and willingness is contrary to the records. The Trial Court and the First Appellate Court have committed an error in declining to grant the relief of specific performance of contract. In view of the above discussion, I answer substantial question Nos.1 and 2 in the ‘affirmative’ and substantial question No.3 in the ‘negative’.

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Substantial Question No.4:

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It is the case of the defendants that Sri. K Ganesh was not made as a party and he has not signed on the agreement of sale and he has not been arrayed as a defendant in the suit.

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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It is the case of the plaintiff that the suit schedule

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property is owned by the defendant No.1. Though, it is the case of the defendants that the suit schedule property is the joint family property of the defendants, but the defendants in the written statement have not pleaded that the suit schedule property is a joint family property of the defendants.

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Learned counsel for the defendants submits that

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there is a recital in the agreement of sale that the suit schedule property is the joint family property of the defendants and Sri. K Ganesh. But, the defendants have not taken the said plea in the written statement. Hence, though it is stated in the plaint that the defendants and Sri K. Ganesh also agreed to sign the registered sale deed, Sri K Ganesh has not signed on the agreement of sale and he has not been arrayed as a party to the suit. Mere non-joinder of necessary party is not a ground to declare the agreement of sale as void. The defendant Nos.1 to 3 have agreed to execute a registered sale deed in respect of the suit schedule property. In view of the above, I answer the substantial question No.4 in the ‘negative’.

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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In view of the above discussion, I proceed to pass the following:

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ORDER

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(i) The appeal is allowed .

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(ii) The impugned judgment and decree passed in R.A. No.68/2008 dated 26.10.2011 passed

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by the First Appellate Court is set aside and the suit of the plaintiff in O.S.No.316/2006 dated 30.08.2008 filed for the relief of specific performance of contract is decreed.

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(iii) The defendant Nos.1 to 3 are directed to execute the registered sale deed in favour of plaintiff within a period of three months from today after receiving the consideration amount which shall be paid by the plaintiff within one month from today, if the defendants failed to accept the consideration amount, the plaintiff is at liberty to deposit before the trial Court.

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NC: 2023:KHC:41072 RSA No. 238 of 2012

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(iv) In case, if the defendant Nos.1 to 3 fail to execute the registered sale deed, the plaintiff is at liberty to get the sale deed executed under due process of law.

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(v) Learned counsel for the defendants submits that the defendants have deposited the amount of Rs.13,066/- before Trial Court. Hence, the defendants are at liberty to withdraw the said amount.

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Sd/JUDGE

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SRA/ST

Smt v. Shelvi v Smt Bhagyamma

Case brief

What is this about?

What did the court decide?

Smt v. Shelvi v Smt Bhagyamma

Case brief

What is this about?

What did the court decide?

What the court decided

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