Sri R Shivalingappa Vs Sri N B Sudhakara

SRI. N.B. SUDHAKARA, S/O LATE R. BASAVARAJAPPA, AGED ABOUT 37 YEARS, RESIDENT OF NERALEKERE AT POST, AMRUTHAPURA HOBLI, TARIKERE TALUK, CHIKMAGALUR DIST. - 577 101.

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…RESPONDENT

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(BY SRI. R. SHASHIDHARA, ADVOCATE)

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THIS RSA IS FILED U/S. 100 OF CPC AGAINST THE JUDGMENT & DECREE DATED 12.4.13 PASSED IN R.A.NO.175/2010 ON THE FILE OF PRINCIPAL DISTRICT JUDGE, CHIKMAGALUR, DISMISSING THE APPEAL AND CONFIRMING THE JUDGMENT AND DECREE DATED 24.5.2010 PASSED IN OS.NO.93/2006 ON THE FILE OF SENIOR CIVIL JUDGE AND PRINCIPAL JMFC, TARIKERE.

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THIS APPEAL, COMING ON FOR FINAL 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 appellants challenging the judgment and decree dated 12.04.2013, passed in R.A.No.175/2010 by the learned Principal District Judge, Chikmagalur, and the judgment and decree

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dated 24.05.2010, passed in O.S.No.93/2006 by the

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learned Senior Civil Judge and Principal JMFC, Tarikere.

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For convenience, the parties are referred to,

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based on their rankings before the trial Court. The appellants were the defendants, and the respondent was the plaintiff.

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Brief facts, leading rise to the filing of this appeal are as follows:

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The plaintiff filed a suit against the defendants for a specific performance of the contract. It is contended that the defendants were the owners of the suit schedule property, and they agreed to sell the suit schedule property for a consideration of Rs.1,75,000/and accordingly, the plaintiff paid a sum of Rs.1,00,000/towards an advance sale consideration amount. The sale agreement was entered into on 22.05.2006 and it was agreed that the balance sale consideration amount would be paid within 2½ months from the date of execution of

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the sale agreement by receiving remaining consideration amount of Rs.2,75,000/-. The sale agreement was registered on the same day. It is contended that the plaintiff was/is always ready, and willing to perform his part of the contract, but the defendants did not perform their part of the contract. The plaintiff issued a legal notice on 20.09.2006 calling upon the defendants to receive the balance sale consideration amount, and execute a registered sale deed. The defendants replied untenably to the said legal notice. Hence, a cause of action arose for the plaintiff to file a suit for specific performance of the contract. Accordingly, he pray to decree the suit.

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3.1. The defendants filed a written statement

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denying the averments made in the plaint. The defendants disputed the boundaries of the suit property and contended that the plaintiff has agreed in 2005 agreement about the boundaries mentioned therein, and contrary to the said agreement, which he has entered into. It is

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contended that the defendants have got entered their names in the revenue records regarding the property in Sy.No.5/2, and Sy.No.5/3 has been wrongly entered, and the plaintiff to harass these defendants, has filed this suit. It is contended that as per the agreement entered into in 2005, the plaintiff has to get the survey done regarding Sy.No.142 land of Nerlekere village and then, the defendants have to execute the sale deed. But, the plaintiff is acting contrary to the said agreement. Hence, he prays to dismiss the suit.

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3.2. The Trial Court, based on the aforementioned

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pleadings, framed the following issues:

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1) Whether the plaintiff proves that the defendants being the owners in possession of the plaint schedule property have agreed to sell the plaint schedule property to the plaintiff for a sale consideration of Rs.1,75,000/- and accordingly executed agreement of sale in favour of the plaintiff on 22.05.2006 by receiving advance amount of Rs.1,00,000/-?

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2) Whether the plaintiff further proves that defendants have to execute the registered

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sale deed by receiving balance amount of Rs.75,000/- within 2 and half months?

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3) Whether the plaintiff further proves that he was and he is always ready and willing to perform his part of the contract?

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4) Whether the plaintiff further proves that he is entitled for the relief of specific performance of agreement as prayed in the plaint?

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5) Whether the plaintiff further proves that he is entitled for possession of the plaint schedule property from the defendants?

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6) Whether the defendants proves that boundaries of the suit schedule property are written wrong while writing the agreement by mistake?

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7) Whether the defendants further proves that plaintiff has failed to perform his part of contract and against the agreement of 2005 completely?

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8) Whether the defendants further proves that plaintiff has created the document for this case as stated in Para-7 of the written statement?

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9) What decree or order?

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3.3. The plaintiff, to substantiate his case, examined

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himself as PW.1, examined one witness as PW.2, and marked 13 documents as Exs.P1 to P13. On the other

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hand, defendant No.2 was examined as DW.1 and marked

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2 documents as Exs.D1 and D2. The trial Court, after recording the evidence, hearing both sides, and assessing the verbal and documentary evidence of the parties, answered issue Nos.1 to 5 in the affirmative, issue Nos.6 to 8 in the negative, and issue No.9 as per the final order.

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The suit of the plaintiff was decreed with costs vide judgment dated 24.05.2010 the defendants were directed to execute a sale deed in favour of the plaintiff regarding the suit schedule property after receiving the balance sale consideration amount of Rs.75,000/-. It is also held that if the defendants do not come forward to execute the sale deed in favour of the plaintiff, the plaintiff is at liberty to approach this Court to work out remedy.

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3.4. The defendants, aggrieved by the judgment and decree passed in O.S.No.93/2006, preferred an appeal in R.A.No.175/2010 on the file of learned Principal District Judge, Chikmagalur. The First Appellate Court, after hearing the learned counsel for the parties, framed the following points for consideration:

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1) Whether the appellants/defendants have made out a case so as to interfere with the judgment and decree of the trial Court?

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2) What order?

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3.5. The First Appellate Court, on hearing the

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parties, and after reassessing the verbal and documentary evidence, answered point Nos.1 in the negative and point No.2 as per the final order. The appeal was dismissed vide judgement dated 12.04.2013. The judgment and decree passed in O.S.No.93/2006 dated 24.05.2010 by the learned Senior Civil Judge, Tarikere was confirmed. The defendants, aggrieved by the impugned judgment, filed this Regular Second Appeal.

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This Court, on 23.06.2014, admitted the appeal

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to consider the following substantial questions of law :

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1) Whether the plaintiff had substantiated all grounds and circumstances falling under Section 10 of the Specific Relief Act, 1963 to be entitled for decree of Specific Performance?

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2) Whether the trial Court and appellate Court have considered the defence of the defendants in the light of clause-(a), (b) and (c) of Section 20 of the Specific Relief Act, 1963?

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Heard the arguments of the learned counsel for

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the defendants, and the learned counsel for the plaintiff.

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Learned counsel for the defendants submits

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that the judgments and decree passed by the courts below are arbitrary and erroneous, and contrary to the records produced by the parties. He submits that during the course of cross-examination of PW.1, he has admitted that he was required to perform his part of a contract before asking for a completion of sale transaction. It is contended that the plaintiff has not performed his part of a contract. He submits that the plaintiff has failed to prove that, he was ready and willing to perform his part of a contract. He further submits that the first Appellate Court without assigning the reasons, confirmed the judgment and decree

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passed by the trial Court. Hence, on these grounds, he

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prays to allow the appeal.

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Learned counsel for the plaintiff submits that the defendants admitted the execution of the sale agreement, and further, the plaintiff, to prove that, he was/is always ready and willing to perform his part of contract, the plaintiff issued a legal notice marked as Ex.P2. The plaintiff has proved the execution of the sale agreement, and readiness and willingness in performing his part of contract. He submits that the trial Court by exercising the discretion, has rightly decreed the suit of the plaintiff and directed the defendant, to execute a registered sale deed in favour of the plaintiff by receiving the balance sale consideration amount of Rs.75,000/-. He submits that the First Appellate Court, on assessing the entire evidence on record, has rightly confirmed the judgment passed by the trial Court. Hence, on these grounds, he prays to dismiss the appeal.

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Perused the records, and considered the

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submissions of learned counsel for the parties.

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9. Reg. Substantial questions of law

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No.1 and 2 : The plaintiff, to prove his case, examined himself as PW.1. He deposed that the defendants are the owners of the suit property and agreed to sell the suit property for a consideration of Rs.1,75,000/-, and the defendants received Rs.1,00,000/- towards an advance sale consideration amount. It was agreed to execute a registered sale deed by receiving the balance sale consideration amount of Rs.75,000/- within 2 and half months. Accordingly, the sale agreement was registered on 22.05.2006. The plaintiff was/is always ready and willing to perform his part of a contract, but the defendants went on postponing the execution of the registered sale deed on one pretext or the other. The plaintiff, to establish his readiness and willingness, issued a legal notice to the defendants, calling upon them to receive the balance sale consideration amount, and

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execute a registered sale deed, but the defendants replied untenably to the legal notice denying the averments made in the legal notice. The plaintiff, to prove the execution of the registered sale agreement dated 22.05.2006, produced the original sale agreement marked as Ex.P1. Ex.P2 is the office copy of the legal notice, Exs.P3 to P5 are the postal acknowledgement, Ex.P6 is the reply notice to Ex.P2, Ex.P7 is a certified copy of the registered sale deed dated 12.12.1961 which discloses that Revanna purchased 0-10 guntas of land from A.Shankarappa and others, Ex.P8 is a certified copy of the registered sale deed dated 12.12.1961, Ex.P9 is a certified copy of Tippani Uthar, Ex.P10 is a certified copy of alienation order, Ex.P11 is a certified copy of phodi thakte and Exs.P12 and 13 are the RTC’s. The plaintiff, also examined one Sri K.Shivashankhar as PW.2. He is a attesting witness to Ex.P1. He deposed in the same line of PW.1 and identified his signature on Ex.P1, and marked as Ex.P1(g). Nothing

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has been elicited from the mouth of these witnesses to

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disbelieve the evidence.

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In rebuttal, defendant No.2 examined himself as DW.1. He reiterated the written statement averments in the examination-in-chief, and marked two documents as Ex.D1 and Ex.D2. During the course of his crossexamination, DW.2 admitted the execution of a sale agreement i.e., Ex.P1, and receipt of Rs.1,00,000/towards an advance sale consideration amount. As the defendants have admitted the execution of Ex.P1, the question of proving Ex.P1 does not arise, in view of Section 58 of the Indian Evidence Act, 1872 i.e., the fact admitted need not be proved. Now the question that arises is whether the plaintiff is entitled for a decree of specific performance of a contract. It is necessary to examine Sections 10 and 20 of the Specific Relief Act, 1963, (for

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short ‘the Act of 1963’) which reads as follows:

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10. Cases in which specific performance of contract enforceable .—

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Except as otherwise provided in this Chapter, the specific performance of any contract may, in the discretion of the court, be enforced—

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(a)when there exists no standard for ascertaining actual damage caused by the nonperformance of the act agreed to be done; or

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(b)when the act agreed to be done is such that compensation in money for its non-performance would not afford adequate relief.

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Explanation.—Unless and until the contrary is proved, the court shall presume—

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(i)that the breach of a contract to transfer immovable property cannot be adequately relieved by compensation in money; and

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(ii)that the breach of a contract to transfer movable property can be so relieved except in the following cases:—

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(a)where the property is not an ordinary article of commerce, or is of special value or interest to the plaintiff, or consists of goods which are not easily obtainable in the market;

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(b)where the property is held by the defendant as the agent or trustee of the plaintiff.

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It is, therefore, clear from the said section that grant of Specific Performance is in the discretion of the Court.

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20. Discretion as to decreeing specific performance .—

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(1)The jurisdiction to decree specific performance is discretionary, and the court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal.

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(2)The following are cases in which the court may properly exercise discretion not to decree specific performance:—

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(a)where the terms of the contract or the conduct of the parties at the time of entering into the contract or the other circumstances under which the contract was entered into are such that the contract, though not voidable, gives the plaintiff an unfair advantage over the defendant; or

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(b)where the performance of the contract would involve some hardship on the defendant which he did not foresee, whereas its non-performance would involve no such hardship on the plaintiff; or

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(c)where the defendant entered into the contract under circumstances which though not rendering the contract voidable, makes it inequitable to enforce specific performance.

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Explanation 1.—Mere inadequacy of consideration, or the mere fact that the contract is

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onerous to the defendant or improvident in its nature, shall not be deemed to constitute an unfair advantage within the meaning of clause (a) or hardship within the meaning of clause (b).

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Explanation 2.—The question whether the performance of a contract would involve hardship on the defendant within the meaning of clause (b) shall, except in cases where the hardship has resulted from any act of the plaintiff subsequent to the contract, be determined with reference to the circumstances existing at the time of the contract.

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(3)The court may properly exercise discretion to decree specific performance in any case where the plaintiff has done substantial acts or suffered losses in consequence of a contract capable of specific performance.

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(4)The court shall not refuse to any party specific performance of a contract merely on the ground that the contract is not enforceable at the instance of the party.”

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As per Section 10 of the Act of 1963, the specific performance of a contract, may in the discretion of the court, be enforced— (a)when there exists no standard for ascertaining actual damage caused by the nonperformance of the act agreed to be done; or (b)when the

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act agreed to be done is such that compensation in money for its non-performance would not afford adequate relief. Explanation.—Unless and until the contrary is proved, the court shall presume— (i)that the breach of a contract to transfer immovable property cannot be adequately relieved by compensation in money; and (ii)that the breach of a contract to transfer movable property can be so relieved except in the following cases:— (a)where the property is not an ordinary article of commerce, or is of special value or interest to the plaintiff, or consists of goods which are not easily obtainable in the market; (b)where the property is held by the defendant as the agent or trustee of the plaintiff.

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It is, therefore, clear from the said section that grant of Specific Performance is in the discretion of the Court.

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Apart from this, there is Section 20 of the Act of 1963, which reads as follows: 20(1)The jurisdiction to

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decree specific performance is discretionary, and the court

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is not bound to grant such relief merely because it is lawful to do so; but the discretion of the court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal. (2)The following are the cases in which the court may properly exercise discretion not to decree specific performance:— (a)where the terms of the contract, or the conduct of the parties at the time of entering into the contract or the other circumstances under which the contract was entered into are such that the contract, though not voidable, gives the plaintiff an unfair advantage over the defendant; or (b)where the performance of the contract would involve some hardship on the defendant which he did not foresee, whereas its non-performance would involve no such hardship on the plaintiff; or (c)where the defendant entered into the contract under the circumstances which though, not rendering the contract voidable, makes it inequitable to

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enforce specific performance. Explanation 1.—Mere

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inadequacy of consideration, or the mere fact that the contract is onerous to the defendant or improvident in its nature, shall not be deemed to constitute an unfair advantage within the meaning of clause (a) or hardship within the meaning of clause (b). Explanation 2.—The question whether the performance of a contract would involve hardship on the defendant within the meaning of clause (b) shall, except in cases where the hardship has resulted from any act of the plaintiff subsequent to the contract, be determined with reference to the circumstances existing at the time of the contract. (3)The court may properly exercise discretion to decree specific performance in any case where the plaintiff has done substantial acts or suffered losses in consequence of a contract capable of specific performance. (4)The court shall not refuse to any party specific performance of a contract merely on the ground that the contract is not enforceable at the instance of the other party.”

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The case on hand does not fall within the ambit

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of Section 10 of the Specific Relief Act, 1963, and the plaintiff is entitled to a decree of specific performance. The defendants have not pleaded regarding hardship in the written statement that if the suit for specific performance of a contract is decreed, the defendants would be put to hardship, and the defendants have not acted, as the agent or trustee of the plaintiff. The agreement entered by the defendants would not render the contract voidable. The plaintiff is entitled to a decree of specific performance of a contract. Both the courts below were justified in passing the impugned judgments. I do not find any error in the impugned judgments. In view of the above discussion, the substantial questions of law No.1 and 2, are answered in the affirmative.

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