Dismissed

K G Pillamadappa v. Chikka Nanjundappa

Karnataka HC13 Sept 2024RFA/2340/2007

Case brief

AI extract

What is this about?

This court dismissed an appeal against a regular first appeal decreeing specific performance. The appellant challenged the trial court's finding that a subsequent purchaser violated lis pendens under Section 52 of the Transfer of Property Act and was not a bonafide purchaser. The court upheld the trial court's decision.

What did the court decide?

The appeal is dismissed, affirming the trial court's decree for specific performance in favor of the plaintiff.

K G Pillamadappa Vs Chikka Nanjundappa — Specific Performance | Karnataka HC (2024)

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NC: 2024:KHC:37735 RFA No. 2340 of 2007

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 13^TH DAY OF SEPTEMBER, 2024

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BEFORE

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THE HON'BLE MR JUSTICE SACHIN SHANKAR MAGADUM

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REGULAR FIRST APPEAL NO.2340 OF 2007 (SP)

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BETWEEN:

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K.G.PILLAMADAPPA S/O LATE CHIKKAMADAPPA @ LACHAPPA AGED ABOUT 69 YEARS R/AT KALKERE VILLAGE BANASWADI POST K.R.PURAM HOBLI BENGALURU - 560 043

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…APPELLANT

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(BY SRI.SACHIN B S, ADVOCATE)

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AND:

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Digitally signed by NAGARAJA B M Location: HIGH COURT OF KARNATKA

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CHIKKA NANJUNDAPPA S/O LATE SRI.MUNISWAMAPPA

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SINCE DEAD

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1(A) SRI.C.PRAVEEN KUMAR S/O LATE CHIKKANANJUNDAPPA AGED ABOUT 40 YEARS RESIDING AT NO.94 CHIKKANANJUNDAPPA LAYOUT 1^ST MAIN, 2^ND CROSS KALKERE VILLAGE HORAMAVU POST BENGALURU - 560043

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NC: 2024:KHC:37735 RFA No. 2340 of 2007

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SRI. S NARAYANASWAMY S/O LATE SRI.SIDDAPPA AGED ABOUT 57 YEARS R/AT KALKERE VILLAGE BANASAWADI POST K.R.PURAM HOBLI BENGALURU - 560 043

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…RESPONDENTS

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(BY SRI. S SRINIVASA MURTHY, ADVOCATE FOR R.1(A); NOTICE TO R.2 IS D/W V/O/D 24.08.2023)

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THIS RFA IS FILED U/SEC.96 OF CPC AGAINST THE JUDGMENT AND DECREE DATED 11.07.2007 PASSED IN O.S. NO.4767/1994 ON THE FILE OF THE V ADDL. CITY CIVIL JUDGE, BANGALORE, DECREEING THE SUIT FOR ENFORCEMENT THE AGREEMENT OF SALE AND PERMANENT INJUNCTION AND ETC.

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THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE SACHIN SHANKAR MAGADUM

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ORAL JUDGMENT

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The captioned Regular First Appeal is by the Pendente lite purchaser arrayed as defendant No.2 in a suit for specific performance filed by the plaintiff based on the sale agreement dated 02.08.1993. The Trial Court has

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decreed the suit and has granted relief of specific performance of contract and defendant No.2 is held to be not a bonafide purchaser and the Court has declared that the sale deed obtained by defendant No.2 is hit by Section 52 of Transfer of Property Act and therefore, not binding on the plaintiff.

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For the sake of brevity, the parties are referred as they are ranked before the Trial Court.

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The subject matter of the suit is an agricultural land bearing Sy. No.352 measuring 3 guntas of Kalkere Village, K.R.Puram Hobli, Bengaluru. The plaintiff instituted a suit seeking relief of specific performance of contract based on the sale agreement executed by defendant No.1 on 02.08.1993 for sale consideration of Rs.12,000/-. The plaintiff in the said suit alleged that defendant No.1 offered to sell the suit land and accordingly, executed an agreement on 02.08.1993. The plaintiff further alleged that pursuant to the agreement, an advance amount of Rs.5,000/- was paid to defendant

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NC: 2024:KHC:37735 RFA No. 2340 of 2007

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No.1. Though the plaintiff called upon defendant No.1 to conclude the transaction and inspite of legal notice, defendant No.1 has not come forward to perform his part of contract. The present suit is filed.

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Having filed the suit, the plaintiff filed an

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application under Order 39 Rule 1 & 2 of CPC., apprehending that defendant No.1 may meddle with the property. The Trial Court granted interim injunction and defendant No.1 was restrained from alienating the suit schedule property. Pending suit, the plaintiff filed the impleading application and sought to implead respondent No.2.Defendant No.2 purchased the suit property on

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24.08.1994 in violation of the interim order.

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Defendant No.2 contested the suit by filing the written statement. Defendant No.2 seriously disputed the plaintiff's transaction and claimed that he has obtained the sale deed, which is based on much prior to plaintiff's suit

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agreement. In the written statement, defendant No.2 specifically pleaded that he has paid the entire sale

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consideration and secured possession of the entire 2 acres 19 guntas along with Tamarind Trees. The defendant No.2 contended that while plaintiff is asserting lesser extent of 3 guntas, he has purchased entire extent measuring 2 acres 19 guntas and therefore, sought for dismissal of the suit. The defendant No.2 filed additional written statement denying the allegation of the plaintiff that he has purchased the property though it was well within his knowledge and in violation of interim injunction granted by the Trial Court. Defendant No.2 on the contrary asserted that he is the bonafide purchaser of 2 acres 19 guntas in Sy. No. *352 . Defendant No.2 on the contrary asserted that the plaintiff has concocted documents and suit is filed only to harass defendant No.2.

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The Trial Court having examined the pleadings,

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oral and documentary evidence answered issue Nos.1 to 5 in the Affirmative, while additional issue No.1 relating to the claim of defendant No.2 that he is the bonafide purchaser was answered in the Negative. Consequently,

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corrected vide court order dated 3.2.2025

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the Trial Court having examined the equities decreed the suit declaring that the sale deed obtained by defendant No.2 does not bind the plaintiff's interest insofar as plaint schedule property measuring 3 guntas in Sy. No.352 is concerned.

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Heard learned counsel appearing for defendant No.2 and learned counsel appearing for the plaintiff.

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This Court has independently assessed the pleadings, oral and documentary evidence. This Court has also taken cognizance of the evidence recorded before this Court. The following points that would arise for consideration are;

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1) Whether the findings of the Trial Court that defendant No.2 has failed to substantiate the he is the bonafide purchaser without notice of the suit agreement is perverse and palpably erroneous and therefore, warrant interference at the hands of this Court?

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2) Whether the Trial Court was justified in granting discretionary relief of specific performance in favour of the plaintiff?

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Regarding Point No.1 :- Defendant No.2 to

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demonstrate that he is the bonafide purchaser has taken a contention at para No.4 of the written statement that he has secured an agreement from defendant No.1 much prior to the plaintiff's suit agreement. Para No.4 of the written statement is relevant in the light of the defence set up by defendant No.2 and the same is extracted, which reads as under;

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"4. This defendant submits that he has purchased 2 acres 19 guntas of land including 0.16 guntas of phut kharab in Sy. No.352 of Kalkere Village, K.R.Puram Hobli, Bengaluru South Taluk from the 1^st defendant under a registered Sale Deed dated 24.08.94, and the said document was registered as Document No.4464/9495 and that 1^st defendant had earlier agreed to sell the said land in favour of this defendant and in this regard, the 1^st defendant had executed an Agreement of sale and that the 1^st defendant has received the total consideration amount in respect of the entire land belonging to him and he has also delivered possession of the land and accordingly, this defendant has been in

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possession and enjoyment of the land measuring 2 acres 19 guntas together with the existing tamarind and such other trees and that after the execution of the registered sale deed, the name of this defendant was mutated in the revenue records, such as R.T.C both in Column No.9 and 12(2) and the mutation has been effected in the name of this defendant and that the revenue authorities have also issued a Krishi Pass Book in the name of this defendant."

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Upon meticulous examination of the pleadings in the written statement of Defendant No.2, two critical inconsistencies emerge. Firstly, Defendant No.2 has failed to disclose the actual date of the agreement of sale, which he claims to have obtained from Defendant No.1. Secondly, in relation to the payment of the sale consideration, it is evident from para 4 of the written statement that Defendant No.2 has pleaded the entire sale consideration amount was paid under the agreement. However, Ex.D.9, the registered sale deed dated 24.08.1994, reflects the sale consideration as Rs.1,50,000/-. This is in stark contrast to the agreement set up by Defendant No.2 in Ex.D.8, which reveals the sale

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NC: 2024:KHC:37735 RFA No. 2340 of 2007

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consideration as Rs.5,20,000/-, with an advance payment of Rs.2,00,000/-.

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The clear inconsistencies between the sale deed (Ex.D.9) and the agreement to sell (Ex.D.8), as well as the pleadings of Defendant No.2, raise significant doubts about the veracity of the transactions. It is well-settled law that contradictions in the material terms of a contract, such as the sale consideration, cast doubt on the bona fides of the purchaser. In NARANDAS KARSONDAS V. S.A. KAMTAM¹ , the Supreme Court held that the sale consideration and terms of the sale agreement must be clear, precise, and without ambiguity, as any discrepancy affects the validity of the transaction.

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Moreover, the written statement of Defendant No.2 lacks essential details, such as the date of the agreement to sell. However, during trial, Defendant No.2 produced an agreement dated 28.03.1993, in which the sale consideration was fixed at Rs.5,50,000/-, with an

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1 (1977) 3 SCC 247

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advance payment of Rs.2,00,000/-. These facts, coupled with the discrepancies in the sale deed (Ex.D.9), clearly undermine the defense's claim of having fully paid the sale consideration.

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It is established law that where there is inconsistency between the pleadings and the documentary evidence, such inconsistencies weaken the credibility of the defense. In BHARAT SINGH V. MST. BHAGIRATHI² , the Hon'ble Supreme Court emphasized that pleadings must be consistent with the evidence adduced. The contradictions in this case, therefore, render Defendant No. 2's assertions unreliable.

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Furthermore, the records reveal that Defendant No.2 purchased the property during the pendency of the suit, in violation of an interim injunction granted by the Trial Court. In such circumstances, the doctrine of lis pendens under Section 52 of the Transfer of Property Act, 1882, is clearly applicable. The principle of lis pendens is 2 AIR 1966 SC 405

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NC: 2024:KHC:37735 RFA No. 2340 of 2007

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well-established in JAYARAM MUDALIAR V.

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AYYASWAMI³ , where the Hon'ble Supreme Court held that any transfer of immovable property during the pendency of a suit affecting such property is subject to the outcome of the litigation.

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In the present case, Defendant No.2's rights in the property, as per the registered sale deed (Ex.D.9), are subject to the doctrine of lis pendens , and not to the protections of Section 19(b) of the Specific Relief Act, 1963, which applies to bonafide purchasers without notice of prior claims. Since Defendant No.2 purchased the property with full knowledge of the pending suit and in violation of the Court's interim order, he cannot claim the benefit of Section 19(b) of the Specific Relief Act. The

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Supreme Court in SANJAY VERMA V. MANIK ROY⁴ , reiterated that a purchaser during the pendency of

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3 AIR 1973 SC 569

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4 (2006) 13 SCC 608

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litigation cannot claim to be a bonafide purchaser if they have knowledge of the dispute.

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The rights of Defendant No.2 under the registered sale deed (Ex.D.9) are, therefore, subject to the final outcome of the pending suit. The plaintiff, on the other hand, has successfully demonstrated his entitlement to the relief sought by producing cogent evidence regarding his agreement with Defendant No.1.

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In light of the aforementioned facts and judicial precedents, this Court holds that defendant No.2 is not a bona fide purchaser but rather a pendente lite purchaser, and his rights are subject to Section 52 of the Transfer of Property Act. Accordingly, the point No.1 is answered in the Negative .

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Regarding Point No.2 :- The plaintiff has instituted the present suit based on the agreement for sale dated 02.08.1993, marked as Ex.P.1. The principal issue for determination by this Court is whether the plaintiff has

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successfully established a case for the grant of the discretionary relief of specific performance under the Specific Relief Act, 1963. Additionally, this Court must assess whether the equities lean in favor of the plaintiff, making it appropriate to grant specific performance.

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The plaintiff’s claim is rooted in a family relationship between his father, Muniswamappa, and the father of Defendant No.1, Siddappa, who were brothers. It is submitted that after the death of the plaintiff’s father in 1980, there was a partition in the year 1982 between the plaintiff and his brothers on one side and defendant No.1's father and brothers on the other side. As a result of this partition, the entirety of Sy. No.352 was allotted to the share of Siddappa, defendant No.1’s father. Subsequently, after Siddappa's death in 1988, there was a further partition within Defendant No.1's family, wherein 1 acre 33 guntas from Sy. No.352 was allotted to Defendant No.1.

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Significantly, it was asserted that three

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Tamarind Trees, which had been allotted to the plaintiff and his brothers in the earlier partition of 1982, were located on the portion now owned by Defendant No.1. Consequently, the plaintiff sought to purchase the land measuring 3 guntas, where these Tamarind Trees stood. This resulted in an agreement to sell being executed between the plaintiff and Defendant No.1 on 02.08.1993. This agreement forms the basis of the plaintiff’s claim for specific performance.

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A crucial requirement for the grant of specific performance is the plaintiff's readiness and willingness to perform their obligations under the contract, as mandated by Section 16(c) of the Specific Relief Act. The plaintiff must demonstrate continuous readiness and willingness from the date of the agreement to the conclusion of the suit. In the present case, the records reveal that the plaintiff has consistently maintained his readiness and willingness to perform his part of the contract. This is

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evidenced by the execution of the agreement for sale (Ex.P.1) and the plaintiff’s prompt filing of the suit when Defendant No.1 failed to execute the sale deed.

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In N.P. THIRUGNANAM V. DR. R. JAGAN MOHAN RAO⁵ , the Hon'ble Supreme Court emphasized

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that the plaintiff must plead and prove readiness and willingness to perform the essential terms of the contract. Here, the plaintiff has sufficiently discharged this burden, and his claim is supported by the fact that he had already obtained a decree for specific performance, which has been executed, and possession has been taken. Therefore, the plaintiff's continuous readiness and willingness is established beyond doubt.

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The equitable nature of the relief of specific performance means that the Court must assess whether fairness lies on the plaintiff’s side. In the instant case, the agreement to sell was entered into between parties who shared a close family relationship, and the plaintiff’s desire 5 (1995) 5 SCC 115

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to retain the Tamarind Trees, which were allotted to him and his brothers in the earlier partition, further strengthens the fairness of the transaction. The sale of a small portion of land (3 guntas) by Defendant No.1 to the plaintiff was motivated by this equitable concern.

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The Hon'ble Supreme Court in SARANGADEVA PERUMAL V. V.R. BALAKRISHNA⁶ , held that specific performance may be granted when equities lie in favor of the plaintiff, and the transaction is fair and just. Here, the plaintiff's claim over the 3 guntas, which only represents a fraction of the land in Sy. No.352, was made in a family context, and no significant prejudice will be caused to the defendants if the specific performance is decreed. The case records reveal that Defendant No.2, during the pendency of the suit, purchased a larger portion of land measuring 1 acre 33 guntas along with 16 guntas of karab land in Sy. No. 352. The plaintiff's claim, however, is limited to 3 guntas, where the Tamarind Trees stand.

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6 (2017) 3 SCC 737

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Even if Defendant No.2's purchase of the entire extent is held not to bind the plaintiff with respect to these 3 guntas, no serious prejudice would be caused to Defendant No.2. The Trial Court, in its judgment, also limited the non-binding nature of Defendant No.2's sale deed only to this extent of 3 guntas, preserving his purchase over the remaining land.

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The principle that a subsequent purchaser’s rights are subject to the outcome of the pending litigation is established in Section 52 of the Transfer of Property Act, which enshrines the doctrine of lis pendens . This doctrine has been reiterated by the Supreme Court in JAYARAM MUDALIAR V. AYYASWAMI⁷ , holding that any transfer made during the pendency of litigation affecting immovable property is subject to the result of the suit. Therefore, Defendant No.2, having purchased the land during the pendency of the suit, cannot assert a superior claim over the 3 guntas.

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7 AIR 1973 SC 569

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Further, the sale deed executed in favor of Defendant No.2 during the pendency of the suit and in violation of the Court's interim order is a nullity as per A.V. PAPAYYA SASTRY V. GOVT. OF A.P.,⁸ Thus, Defendant No.2's purchase cannot defeat the plaintiff's right to seek specific performance. Although the relief of specific performance is discretionary, such discretion must be exercised judiciously based on established principles.

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In K. NARENDRA V. RIVIERA APARTMENTS (P) LTD.,⁹ the Hon'ble Supreme Court clarified that specific performance should ordinarily be granted when the contract is fair, the plaintiff has demonstrated readiness and willingness, and no hardship is caused to the defendant.

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In the present case, all these conditions are satisfied. The agreement between the plaintiff and Defendant No.1 was entered into in good faith, the plaintiff

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8 (2007) 4 SCC 221

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9 (1999) 5 SCC 77

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has established his readiness to perform, and defendant No.2 will not suffer significant hardship from the enforcement of the specific performance decree. Therefore, equity undeniably favors the plaintiff.

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In conclusion, based on the foregoing, this Court finds that the plaintiff has successfully made out a case for specific performance. The plaintiff’s continuous readiness and willingness to perform his obligations under the agreement, the equitable nature of the transaction, and the lack of prejudice to Defendant No.2 support the grant of specific performance. The Trial Court’s decree in favor of the plaintiff is affirmed, and Point No.2 is answered in the affirmative.

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For the reasons stated supra, the grounds urged in the appeal cannot be entertained. Defendant No.2 has failed to point out that the error committed by the Trial Court. The findings and conclusions recorded by the Trial Court while answering additional issue No.1 does not warrant any interference at the hands of this Court. This

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