Allowed

Sri M Nagaraj v. Sri Kambada Narasimhaiah

Karnataka HC9 Aug 2024RSA/391/2010

Case brief

AI extract

What is this about?

This second appeal challenged a judgment allowing a suit for specific performance of a property sale agreement due to the repeal of the Fragmentation Act. The High Court held the suit was barred by limitation, reversed the first appellate court, and ordered the defendant to refund the sale consideration with interest and vacate the property. It was capped at a property sale of Rs. 16,800 in 1989 w

What did the court decide?

Impugned judgment set aside; trial court judgment restored; defendant to refund Rs. 16,800 with interest; plaintiff to vacate property within six months.

Sri M Nagaraj Vs Sri Kambada Narasimhaiah — Specific Performance | Karnataka HC (2024)

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 9^TH DAY OF AUGUST, 2024

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BEFORE

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THE HON'BLE MR JUSTICE ASHOK S.KINAGI REGULAR SECOND APPEAL NO. 391 OF 2010 (SP)

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BETWEEN:

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SRI. M. NAGARAJ,

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AGED ABOUT 50 YEARS, S/O KOORAPPA @ MUNIYAPPA, R/AT BANDE HOSUR VILLAGE,

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BIDARAHALLI HOBLI, KANNUR DHAKLE, BANGALORE SOUTH TALUK 562 149.

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…APPELLANT

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(BY SMT. D.P. REVATHI, ADVOCATE FOR SRI. D.P. SHIVAPRASAD, ADVOCATE)

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AND:

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Digitally signed by R DEEPA Location: HIGH COURT OF KARNATAKA

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SRI. KAMBADA NARASIMHAIAH, SINCE DECEASED BY LRS.

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SMT. KRISHNAMMA, W/O LATE. KAMBADA NARASIMHAIAH AGED 57 YEARS.

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SRI.RANGACHARI S/O LATE. KAMBADA NARASIMHAIAH AGED 57 YEARS.

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SRI.LAKSHMIPATHI S/O LATE. KAMBADA NARASIMHAIAH AGED 55 YEARS,

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PROPOSED RESPONDENT LRS 1 TO 3 ARE R/AT BANDE HOSUR VILLAGE, KANNUR DHAKALE, BENGALURU SOUTH TALUK- 562 149

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SRI. BHASKAR S/O LATE. KAMBADA NARASIMHAIAH AGED 51 YEARS

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SRI. PURSHOTHAM S/O LATE. KAMBADA NARASIMHAIAH AGED 49 YEARS, R/AT KADDUSONNAPANAHALLI VILLAGE, BIDARAHALLI HOBLI, BEGALURU EAST TALUK

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SRI. SRIDHARA MURTHY, S/O LATE. KAMBADA NARASIMHAIAH AGED 47 YEARS

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SMT. BHYAGAMMA D/O LATE. KAMBADA NARASIMHAIAH AGED 45 YEARS

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SRI. NARASHIMAMURTHY S/O LATE. KAMBADA NARASIMHAIAH AGED 43 YEARS

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SMT. BHARTHI D/O LATE. KAMBADA NARASIMHAIAH AGED 41 YEARS

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RESPONDENT LRS 4, 6 TO 9 ARE RESIDENTS AT BANDE HOSUR VILLAGE, KANNUR DHAKALE, BENGALURU SOUTH TALUK -562 149.

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…RESPONDENTS

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(BY SRI. RAVINDRANATH K., ADVOCATE FOR PROPOSED LR'S OF R1(2) AND FOR R1(1, 7, 8 AND 9; SRI. NATARAJU T., ADVOCATE FOR R1(4 AND 6);

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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R1(3) SERVED; V/O DATED 18.08.2023, NOTICE TO R1(5) IS HELD SUFFICIENT)

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THIS RSA IS FILED U/O 42 R- 1 & 2 R/W S-100 OF CPC., AGAINST THE JUDGMENT AND DECREE DATED 16.12.2009 PASSED IN R.A.75/2007 ON THE FILE OF THE PRL DISTRAIT JUDGE, BANGALORE RURAL DISTRICT, BANGALORE, ALLOWING THE APPEAL AND SETTING ASIDE THE JUDGMENT AND DECREE DATED 15.03.2007 PASSED IN O.S.06/2003 ON THE FILE OF THE ADDL-II CIVIL JUDGE (JR.DN), BANGALORE RURAL DISTRICT, BANGALORE.

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THIS APPEAL, COMING ON FOR FURTHER HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

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CORAM: HON'BLE MR JUSTICE ASHOK S.KINAGI

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ORAL JUDGMENT

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This regular second appeal is filed by the appellant challenging the judgment and decree dated 16.12.2009, passed in R.A.No.75/2007 by the Principal District and Sessions Judge, Bangalore Rural District, Bangalore.

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For the sake of convenience the parties are referred to as per their ranking before the trial court. The appellant is the defendant and respondent is the plaintiff.

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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

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Plaintiff filed a suit for a specific performance of contract against the defendant. It is the case of the plaintiff that, suit property is belonging to the defendant and the defendant agreed to sell the suit property for a sale consideration amount of a Rs.16,800/- and received the entire consideration amount as on the date of executing the agreement. As on the date of execution of sale agreement, The Karnataka Prevention Of Fragmentation And Consolidation Of Holdings Act 1956 (hereinafter referred to as 'Fragmentation Act' for brevity) was in force, so the defendant executed an agreement of sale, power of attorney, and an affidavit confirming the transaction and the plaintiff after the repealing of the Fragmentation Act, got issued a legal notice to the defendant calling upon the defendant to execute a registered sale deed. But the defendant did not perform his part of contract. The plaintiff was/is ready and willing

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to perform his part of contract, but the defendant did not comply with the terms and conditions. On the contrary, the defendant replied to the legal notice accepting the execution of an agreement of sale, but denied readiness and willingness. Hence, cause of action arose for the plaintiff to file a suit for specific performance of contract.

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The defendant filed the written statement admitting the execution of sale agreement in favour of the plaintiff and receipt of sale consideration amount and delivery of possession. But denied that the plaintiff demanded them to execute a registered sale deed and the defendant refused to register a sale deed and also admitted about the issuance of legal notice by the plaintiff and the defendant has replied to the said notice. It is contended that the defendant is not bound to perform his contract under the sale agreement and there is no cause of action to file the suit and the agreement executed is not enforceable under the eye of law, as the suit filed by the

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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plaintiff is barred by the limitation. Hence, prayed to dismiss the suit.

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The trial court on the basis of the pleadings of the parties framed the issues and additional issue. The plaintiff in order to prove his case examined himself as PW-1 and got marked four documents as Exhibits-P1 to P4 and also examined one more witness PW-2. The defendant

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himself got examined as DW-1 and got marked three documents. The trial court on assessment of the oral and documentary evidence, dismissed the suit of the plaintiff vide judgment dated 15.03.2007. The plaintiff aggrieved by the judgment and decree passed by the trial court preferred an appeal in R.A. No.75/2007 on the file of the learned Principal District And Sessions Judge, Bangalore Rural District, Bangalore.

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The first Appellate Court after hearing the learned counsel for the parties framed the points for consideration and on the reassessment of the oral and documentary evidence, allowed the appeal and set-aside

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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the judgment and decree passed in O.S. No.6/2003 and directed the defendant to execute a registered sale deed within 60 days and on failure to do so, the plaintiff can seek a execution of decree. The defendant aggrieved by the judgment and decree passed in R.A.No.75/2007 filed this Regular Second Appeal.

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Heard the learned counsel for the parties.

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The learned counsel for the defendant submits

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that the suit filed by the plaintiff is barred by limitation.

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She submits that though the sale agreement was executed on 17.04.1989, when the agreement of sale was executed Fragmentation Act was in force and there was a bar under Section-5 of Fragmentation Act. Hence, they had agreed to execute the registered sale deed immediately after the repeal of the Fragmentation Act and the said Act was repealed on 01.02.1991 and the plaintiff ought to have filed a suit within three years from the date of repealing the Act. On the contrary, the plaintiff has filed a suit after

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a lapse of more than nine years from the year of

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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repealing. As the time is the essence of contract, the plaintiff ought to have filed the suit within three years from the date of repealing Act and failure to perform the part of contract as per Article-54 of Limitation Act. The suit filed by the plaintiff is barred by limitation. The First Appellate Court without considering the point of limitation has proceeded to pass the impugned judgment.

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The learned counsel for the defendant further submits that the said agreement of sale is contrary to Section-5 of the Fragmentation Act. Hence, she submits that the said agreement is unenforceable in view of the law laid down by the Hon'ble Apex Court in the case of SMT. NARAYANAMMA AND ANOTHER VS. GOVINDAPPA AND

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OTHERS REPORTED IN AIR 2019 SC 4654 and she further submits that the said agreement is contrary to Section-23 of the Indian Contract Act, as the said agreement is forbidden by law. Hence, on these grounds she prays to allow the appeal.

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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Per contra, the learned counsel appearing for the plaintiff submits that the suit filed by the plaintiff is well within time. He further submitted that in the reply notice of the defendant, he admitted about the execution of the agreement to sell, delivery of possession and further the defendant had permitted the plaintiff to put up a construction over the suit schedule property. Pursuant to the agreement of sell the plaintiff constructed a building. Hence, he submitted that after repealing the Act, the plaintiff got issued a legal notice calling upon the defendant to execute a registered sale deed, but the defendant replied to the said legal notice, and taken a defence that the plaintiff was not ready and willing to perform his part of contract and there is a breach of contract on the part of plaintiff. He submits that there is no breach of contract on the part of the plaintiff, on the contrary there was breach on the part of the defendant. The First Appellate Court was justified in passing the impugned judgement. Hence, on these grounds he prays to dismiss the appeal.

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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This Court admitted the appeal to consider the following substantial question of law:

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"Whether the Lower Appellate Court is right in reversing the judgment of the trial court having regard to the recital in the agreement to the execute a registered sale deed after repeal of Fragmentation Act and Exhibit-P4 reply notice could be taken for the purpose of limitation?"

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Heard and perused the records and considered

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the submissions of the learned counsel for the parties.

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Substantial question of Law : It is not in

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dispute that the defendant is the owner of the suit schedule property and the defendant offered to sell the suit schedule property for a sale consideration of Rs.16,800/- and the plaintiff had paid the entire sale consideration amount and the defendant executed an agreement to sell, as per Exhibit-P1 dated 17.04.1989. It was agreed that the sale deed would be executed after

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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repealing of the act of fragmentation. The said Fragmentation Act was repealed on 01.02.1991. Thereafter, the plaintiff got issued a legal notice on 30.07.2002 at Ex.P3 calling upon the defendant to execute a registered sale deed. The defendant replied to the said legal notice at Exhibit-P4. Further, the plaintiff himself got examined as PW-1 and he has reiterated the plaint averments in the examination-in-chief but in the course of cross-examination, he admits that in the year 1989, there was a Fragmentation Act was in force and it was agreed that after the repeal of the Fragmentation Act, the sale deed would be executed and he pleads ignorance about repealing of Fragmentation Act on 01.02.1991.

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A query was put to PW-1 as the Fragmentation Act came to be repealed in the year 1991, you should have got executed the registered sale deed within the year 1994 and PW-1 has replied that he has requested the defendant several times to execute a sale deed and he admits that prior to the year 2002 he has not issued a

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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legal notice to the defendant. Further, the plaintiff also examined one Munigowda as PW-2, who has deposed that

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the defendant agreed to sell the suit schedule property in favour of the plaintiff and executed an agreement of sale on 17.04.1989 and he was the attesting witness to the sale. In the course of cross examination, it elicited in the sale agreement it is mentioned that immediately after the repeal of the Fragmentation Act, the registered sale deed has to be obtained and he pleaded ignorance about when the Fragmentation Act was repealed. The plaintiff also produced the agreement to sell as Exhibit-P1 which discloses that the defendant executed an agreement of sale in favour of the plaintiff.

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On the other hand, the defendant examined

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himself as DW-1 and he has reiterated the written statement averments in the examination-in-chief and got marked three documents i.e., RTC marked as Exhibit-D1 to D3. From the perusal of oral and documentary evidence that the defendant had executed an agreement to sell and

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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as on the date of execution of sale agreement, the Fragmentation Act was in force. Section 5 of

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Fragmentation Act provides which reads as under:

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"5. Sale, Lease, etc :-

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(1) (a) No person shall sell any fragment in respect of which a notice has been given under sub-section (2) of Section 4, except in accordance with the provisions of clause (b). [(b) Subject to the provisions of Sections 39 and 80 of the Karnataka Land Reforms Act, 1961 (Karnataka Act 10 of 1962), whenever a fragment is proposed to be sold, the owner thereof shall sell it to the owner of a contiguous survey number or recognised sub-division of a survey number (hereinafter referred to as the contiguous owner). Is the fragment cannot be so sold to the contiguous owner, for any reason, the owner- of the fragment shall intimate in the prescribed form, the reasons therefore along with an affidavit in support thereof to the Tahsildar and also send copies of such intimation and affidavit to the Sub- registrar, in the prescribed manner and may thereafter sell such fragment to any other

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person.]

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(2) Notwithstanding anything contained in any law for the time being in force or in any instrument or agreement, no such fragment shall be leased to any person other than a person cultivating any land, which is contiguous to the fragment.

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(3) No such fragment shall be sub-divided or partitioned."

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From the perusal of Section-5 of Fragmentation Act no person shall sell any fragment in respect of which a notice has been given under sub-section (2) of Section 4, except in accordance with the provisions of clause (b). Suit land was obtained in the standard area under Section 3 of Consolidation Act and there was a bar for alienating for selling the fragment as per Section 5. The said agreement executed between the plaintiff and the defendant, is contrary to the Fragmentation Act, 1956. Further, there is a recital in the agreement that sale deed to be executed after the Act of 1956 is repealed. Admittedly, the said Act was repealed on 01.02.1991. From 1991 till 2002, the plaintiff has not taken any steps for obtaining registered

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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sale deed from the defendant. Further, the said agreement

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is clearly hit by Section 5 of the Karnataka Prevention of Fragmentation and Consolidation of Holdings Act, 1956 as there is complete violation on the sale as per Section 5 of the Act. Thus it is clear that unambiguous legislative intent is that no such sale is permitted under the Act. Undisputedly even after according to the plaintiff the said land was a fragment as such the transaction is in the year 1989 and the suit is filed after 9 years from the date of repealing the Act of 1956. From the perusal of recital of agreement of sale, time was fixed for performance of contract i.e., after repealing the Act of 1956, the defendant to execute registered sale deed. Admittedly,

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the Act of 1956 was repealed on 01.02.1991. After repealing the plaintiff got issued legal notice on 30.07.2002. The defendant issued a reply notice on 14.08.2002. As per Article 54 of the Limitation Act prescribe period of limitation for filing a suit for specific performance within 3 years from the date fixed for performance or if no such date is fixed when the plaintiff

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notice that the performance is refused. In the instant case, time was fixed for performance. The plaintiff ought to have filed suit within 3 years from the date of repeal of Act 1956 i.e., 31.01.1994 but the plaintiff filed a suit on 01.01.2002. Thus the suit filed by the plaintiff is barred by Limitation. Hence, the suit filed by the plaintiff is barred by limitation.

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As observed above, the plaintiff has failed to prove that he was ready and willing to perform his part of contract. Though the plaintiff is in possession of the property, he is not entitled for protection under Section 53A of Transfer of Property Act, 1882, (for short 'the Act' 1882) on the ground that the plaintiff has failed to prove the requirement under Section 53A of the Act, 1882.

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Learned counsel for the defendant has fairly submitted that the defendant is ready and willing to repay the earnest money with reasonable interest thereon. The Division Bench of this Court in the case of SMT. NEELAWWA

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VS. SHIVAWWA REPORTED IN AIR 1989 KAR 45 has

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specifically held that Order 7 Rule 7 of CPC can be moulded. In the present case, taking into account the fair submission of the learned counsel for the defendant, this Court is of the opinion that the defendant must be directed to refund the entire amount of Rs.16,800/with reasonable interest.

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The trial court was justified in dismissing the suit of the plaintiff on the ground of limitation, but the first appellate court without considering the point of limitation decreed the suit of the plaintiff. The suit filed by the plaintiff is barred by limitation. The first appellate court has committed an error in passing impugned judgment. In view of the above discussion, I answer the substantial question of law in the negative.

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Accordingly, I proceed to pass the following:

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ORDER

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The appeal is allowed.

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NC: 2024:KHC:32062 RSA No. 391 of 2010

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Impugned judgment and decree dated 16.12.2009 passed in R.A.75/2007 by the Principal District and Sessions Judge, Bangalore Rural District, Bangalore, is set aside.

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The judgment and decree passed by the trial court is restored.

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The defendant is directed to pay the consideration amount received with interest @ 6% from the date of filing the suit till the realization of amount within 3 months from the date of from today before the trial Court and shall intimate the plaintiff by Registered post as well as certificate of posting. Thereafter, the plaintiff is granted 6 months time to vacate and handover the vacant possession of the suit schedule property without altering the present state of property in any manner.

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In case, the plaintiff fails to vacate and hand over the possession of the suit schedule

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