Karnataka High Court
Chandraiah S/O Channayya Doodi vs Mallamma W/O Basayya Swami on 6 February, 2017
Author: Aravind Kumar
Bench: Aravind Kumar
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IN THE HIGH COURT OF KARNATAKA
KALABURAGI BENCH
DATED THIS THE 6TH DAY OF FEBRUARY 2017
BEFORE
THE HON'BLE MR.JUSTICE ARAVIND KUMAR
REGULAR SECOND APPEAL No.7011/2012
Between:
Chandraiah S/o Channayya Doddial,
Age: 60 years, Occ: Agriculture,
R/o Karnkot, Tq. Tandur,
(Andhra Pradesh)
... Appellant
(By Sri Manvendra Reddy, Advocate)
And:
1. Mallamma W/o Basayya Swami
Age: 45 years,
Occ: Household & Agriculture,
R/o Ganapur, Tq: Chincholi,
Gulbarga District - 585 218.
2. Shambulingayya
S/o Gurulingayya Mathapati,
Age: Major, Occ: Agriculture,
R/o Neevangi Gogi,
Tq: Gulbarga,
Dist: Gulbarga - 585 218.
...Respondents
(By Sri Prashanth Kumar S. Gotur, Adv. for R1 - Absent,
R2 served)
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This Regular Second Appeal is filed under Section 100
of CPC, against the judgment and decree dated: 29.10.2011
passed in R.A.No.65/2006 on the file of the Senior Civil
Judge at Chincholi, allowing the appeal and setting aside the
judgment and decree dated: 03.09.2005 passed in
O.S.No.45/2000 on the file of the Addl. Civil Judge (Jr.Dn.)
at Chincholi.
This appeal coming on for final hearing this day, the
Court delivered the following:
JUDGMENT
This is second defendant's appeal calling in question the correctness and legality of the judgment and decree passed in R.A.No.65/2006 on 29.10.2011 by the Senior Civil Judge, Chincholi, decreeing the suit of the plaintiff for specific performance in its entirety, though Court of Additional Civil Judge (Junior Division) by judgment and decree dated 03.09.2005 passed in O.S.No.45/2000 had decreed the suit partly by directing first defendant to refund the earnest money of Rs.20,000/- with interest at 6% per annum.
2. This appeal has been admitted on 15.02.2012 to consider the following substantial question of law: 3
"Whether the First Appellate Court was justified in reversing the factual finding by the Trial Court in granting lesser relief of refund in exercise of its power under Section 20 of the Specific Relief Act?"
3. I have heard arguments of Sri Manvendra Reddy, learned counsel appearing for appellant. Respondent No.1 is served and represented by Sri Prashanth Kumar S. Gotur and he has remained absent. Respondent No.2 is served and un-represented.
4. During the course of this judgment, parties are referred to as per the ranking in the trial Court.
5. Sri Manvendra Reddy, learned counsel appearing for appellant vehemently contends that first appellate Court has failed to consider the scope of the order of remand passed by this Court namely it has not re- appreciated the evidence available on record in proper perspective and erred in reversing the order of trial Court whereunder it had exercised its judicial discretion 4 under Section 20 of the Specific Relief Act, 1963 not to decree the suit for specific performance. He would further submit that non-consideration of available evidence and erroneously appreciating the available evidence had resulted in first appellate Court decreeing the suit in its entirety. He would submit that judgment and decree passed by the trial Court directing first defendant to refund the earnest money with interest would balance the equities in favour of the parties and particularly when plaintiff was owning 2½ acres in Sy.No.69 which is adjacent and abutting to the suit property and as such no hardship would have been caused to plaintiff if judgment and decree passed by the trial Court had been sustained.
6. Facts in brief which are necessary for adjudicating the substantial question of law formulated herein above can be crystallized as under.
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7. Plaintiff filed a suit for enforcement of an agreement of sale dated 12.08.1999 in respect of agricultural land bearing Sy.No.69 measuring 2 acres 50 guntas. It was the specific case of plaintiff that first defendant is the absolute owner of land bearing Sy.No.69 which originally measured 19 acres 26 guntas and he is the son-in-law of plaintiff (husband's brother's son-in-law), had fallen to bad-vices like playing cards, matka and also having become alcoholic and to fulfill his bad-vices he was mortgaging land to villagers every year without care of family members and their maintenance and to establish said fact, mortgage said to have been created by first defendant to an extent of 5 acres in Sy.No.69 a photo copy of said deed was produced along with plaint. It was also contended that wife and parents of first defendant though had advised first defendant not to alienate family lands to others, he did not follow their advise and as such, wife of first defendant had filed a civil suit before the Court of 6 Munsiff, Chincholi and at the intervention of elders and well-wishers said suit was compromised and under said compromise 14 acres 26 guntas was given to share of other family members like wife and children of first defendant and he had retained western portion of land in Sy.No.69 to an extent of 5 acres as his share. It was also contended that on such compromise decree being drawn, first defendant entered into an agreement of sale with other persons for alienation of land which had fallen to his share and at that time the wife of first defendant advised him not to alienate said land fallen to his share, for which he did not lend his ears and to avoid said land being purchased by any outsider, the family of first defendant, namely plaintiff purchased the land from first defendant to an extent of 2 acres 20 guntas by getting a registered sale deed. It was further contended that remaining 2 acres 20 guntas had been mortgaged by first defendant in favour of one Sri Shivaputrappa for consideration of Rs.21,250/- for a 7 period of five years and as per compromise entered into between first defendant and his wife, 2 acres 20 guntas said land had been allotted to the share of defendant and she had not taken her share as the period of mortgage had not yet expired and to keep up the promise of her husband she was waiting upto 01.04.2000 and on completion of mortgage period first defendant intended to alienate said portion and as such plaintiff entered into an agreement with first defendant to purchase the suit schedule property on 12.08.1999 under which it was agreed that total consideration amount would be Rs.25,000/- and first defendant was paid an advance amount of Rs.20,000/- and balance of Rs.5,000/- was agreed to be paid at the time of registration of sale deed. On these grounds plaintiff contended that despite repeated requests, first defendant had not executed the sale deed and behind the back of plaintiff he had executed a registered sale deed in favour of second defendant on 18.02.2000 and 8 as such the suit in question for enforcement of agreement of sale dated 12.08.1999 came to be filed.
8. In the said suit defendant Nos.1 and 2 were duly served with summons. However, first defendant did not contest the matter and second defendant alone filed the written statement and contested the suit. He denied the averments made in the plaint and it was contended that plaintiff and first defendant being close relatives have filed suit in question in collusion with each other by creating suit agreement and it was fabricated and concocted document. It was also contended that he was a bonafide purchaser of suit property for valuable consideration from first defendant and without notice of prior agreement. Hence, he sought for dismissal of the suit.
9. On the basis of pleadings of the parties, trial Court formulated issues for its adjudication and plaintiff got herself examined as PW-1 and in all she produced eight 9 documents by getting them marked as Exs.P1 to P8 and she also tendered evidence of five witnesses as PWs-2 to
6. Second defendant got himself examined as DW-1 and no document was produced on his behalf. After examining the pleadings and evaluating the evidence tendered by the parties, trial Court by judgment and decree dated 03.09.2005 partly decreed the suit namely, it held that plaintiff had proved that first defendant had agreed to sell the suit schedule property in her favour on receipt of Rs.20,000/- and also held that second defendant had proved that he is a bonafide purchaser of suit property for value without notice of earlier transaction and as such refused to grant the relief of specific performance and as such directed first defendant to refund the earnest money of Rs.20,000/- with interest at 6% per annum.
10. Being aggrieved by said judgment and decree, plaintiff preferred an appeal in R.A.No.65/2006. 10 Appellate Court by its judgment and decree dated 06.09.2008 allowed the appeal and decreed the suit as prayed for and directed defendants 1 and 2 to execute the sale deed in favour of plaintiff within 60 days from date of judgment and also held that plaintiff would be entitled to obtain sale deed through process of Court in the event of defendants 1 and 2 failing to execute same.
11. Being aggrieved by this judgment and decree, second defendant filed RSA No.7124/2008 and co- ordinate Bench of this Court by judgment dated 27.10.2010 had allowed the second appeal on the ground that appellate Judge ought to have bestowed his attention to the issue relating to Section 20 of the Specific Relief Act namely as to whether discretion exercised by trial Court refusing to grant decree for specific performance has been exercised based on evidence and sound principles or not had not been 11 examined and as such matter came to be remanded to first appellate Court.
12. First appellate Court on such remand being made, by judgment and decree dated 29.10.2011 has yet again decreed the suit in its entirety by concluding that first defendant is the son-in-law of plaintiff and in order to save property of her daughter and son from the hands of first defendant plaintiff had entered into an agreement with first defendant to purchase the suit property and during subsistence of said agreement, second defendant who hailed from same village had purchased the suit property knowing fully well the family background of first defendant and plaintiff and he was also aware of the dispute that existed between first defendant, his wife and son and yet he had purchased the suit schedule property and as such he is not a bonafide purchaser. On these grounds first appellate Court had decreed the suit in its entirety. 12 Re-substantial question of law:
13. The facts in detail have been noticed herein above and repeating the same while answering substantial question of law would only burden the records and as such they are not delved upon in detail, except to the extent it is required.
14. As could be seen from the judgment and decree passed by the Courts below, both the Courts have proceeded on the footing that plaintiff is mother-in-law of first defendant or first defendant is the son-in-law of plaintiff. The husband of plaintiff has been examined as PW-6. In his examination-in-chief he has categorically stated that first defendant is his brother's son-in-law vide paragraph No.3 of affidavit dated 16.03.2005 filed in lieu of examination-in-chief. Thus, Courts below committed a factual error arriving at a conclusion that first defendant is the son-in-law of plaintiff or plaintiff being the mother-in-law of first defendant. 13
15. Facts on hand would also disclose that relationship between first defendant and his wife was not cordial and as such there was matrimonial dispute between the parties which resulted in wife of first defendant along with her son filing a suit for declaration and consequential relief of injunction in respect of entire land bearing Sy.No.69 measuring 19 acres 26 guntas (which include present suit schedule property). The records would also disclose said suit ended in a compromise petition being filed as per Ex.P7 and decree came to be drawn as per Ex.P8 whereunder plaintiffs therein were declared as owners of the suit schedule property except 5 acres which was held to be in the ownership of defendant therein i.e. first defendant herein as indicated in said decree. It was also admitted by defendant therein i.e. first defendant herein that plaintiffs 1 to 3 namely his wife and children are the owners in possession of suit land and suit house as mentioned in paragraph 2A and 2B of plaint except to 14 the extent of 5 acres which was given to the share of first defendant herein. Thus, first defendant was exercising his right of ownership over suit property bearing Sy.No.69 to an extent of 5 acres. On such share of 5 acres being allotted to first defendant herein under decree passed in O.S.No.104/1996 he sold 2 acres 20 guntas in favour of plaintiff which is also admitted by the plaintiff herself in the examination-in-chief as well as her husband PW-6. Thus, what remained with first defendant was 2 acres 20 guntas in Sy.No.69 which is the suit schedule property and subject matter of this second appeal.
16. Plaintiff contended that first defendant had executed an agreement of sale dated 12.08.2000 Ex.P2 in her favour agreeing to sell suit property in her favour. Per contra second defendant pleaded that he is a bonafide purchaser of suit property under sale deed dated 19.02.2000 Ex.P3. Trial Court has recorded a 15 finding that plaintiff had proved execution of agreement of sale Ex.P2 and that she was ready and willing to perform her part of contract. This issue was affirmed by first appellate Court also when the appeal came to be allowed on 06.09.2008 in R.A.No.65/2006. When this judgment and decree that is passed in R.A.No.65/2006 dated 06.09.2008 was carried in second appeal before this Court in RSA No.7124/2008 same was disposed of on 27.10.2010 and co-ordinate Bench had recorded a specific finding that finding recorded by the appellate Judge with regard to validity of agreement and receipt of consideration stands confirmed while remitting the matter back to the first appellate Court for examining the issue of exercise of discretionary power under Section 20 of the Specific Relief Act, since had not received the attention of first appellate Court. In other words, the matter came to be remitted to the first appellate Court only to consider the scope of Section 20 of the Specific Relief Act to the facts on hand. It is on 16 such order of remand being made, first appellate Court has yet again decreed the suit in its entirety.
17. While examining the plea for grant of specific relief of enforcement of agreement of sale, it is needless to state that trial Court as well as first appellate Court is required to record a finding with regard to the exercise of its discretion to decree the suit as contemplated under Section 20 of Specific Relief Act, 1963, inasmuch as jurisdiction to decree specific performance is discretionary and Court is not bound to grant such relief merely because it is lawful to do so. However, discretion of the Court is to be exercised based on sound and reasonable approach guided by judicial principles and it cannot be arbitrary. Clause-(a) to clause (c) of sub-section (2) of Section 20 of Specific Relief Act would clearly indicate as to when Courts may properly exercise its discretion to grant decree for specific performance and the circumstances specified in 17 clause (a) to (c) are only illustrative and not exhaustive. Court would take into consideration the circumstances of each case and also the conduct of parties and respective interest under the contract. In case of specific performance of contract, a greater degree of certainty is required and it demands a clear, defined and precise understanding of all terms and they must be exactly ascertained before their performance can be enforced. It cannot be said that such discretion should not be exercised by the Court and the discretion is wide either to decree or to enforce specific performance of contract. Thus, it would depend upon facts and circumstances of each case and there cannot be any straight jacket formula in this regard. For this proposition , the judgment of the Hon'ble Apex Court in the case of Laxman Tatyaba Kankate and another vs. Smt. Taramati Harishchandra Dhatrak reported in AIR 2010 SC 3025 can be looked up.
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18. Keeping in mind aforesaid principles, when facts on hand are examined, it would disclose that second defendant had specifically contended that he is a bonafide purchaser of suit property for value without notice of earlier agreement said to have been executed by first defendant in favour of plaintiff. The evidence on hand viz., deposition of plaintiff would indicate that her husband is a money lender and he is carrying on money lending business in the village where first defendant and second defendant are also residing. The evidence would also disclose that subsequent to compromise petition entered into between first defendant and his wife in O.S.No.104/1996 as per Ex.P7 and P8, first defendant was in possession and enjoyment of 5 acres of land in Sy.No.69, out of which he sold 2 acres 20 guntas or 2½ acres in favour of plaintiff. It has been the specific contention of plaintiff before the trial Court that on advise given by the wife of first defendant they tried to purchase the suit schedule property to avoid 19 any third parties being abutting and adjacent owners and as such they had entered into an agreement of sale Ex.P2 with first defendant. The validity or otherwise of the agreement will not be gone into by this Court inasmuch as co-ordinate Bench while disposing of the second appeal in RSA No.7124/2008 on 27.10.2010 has already affirmed the findings recorded by both the Courts. Hence, said aspect is not dealt with.
19. Both the plaintiff and second defendant in their evidence have admitted that one Sri Shivaputrappa had obtained the suit schedule property on mortgage from first defendant and he was in possession and enjoyment of the same as on the date of agreement of sale dated 12.08.1999 Ex.P-2 and sale deed executed by first defendant in favour of second defendant is dated 19.02.2000 or in other words first defendant was not in possession of the suit property as on the date of sale deed. Plaintiff also admits that subsequent to the sale 20 deed executed by first defendant in favour of second defendant on 19.02.2000 as per Ex.P3 second defendant had continued in possession of the suit property. What was expected of a prudent buyer at the time of purchasing the property was to make enquiries with regard to existing encumbrance over the suit property if any. Undisputedly, Ex.P2 agreement of sale executed in favour of plaintiff was not registered in the office of jurisdictional Sub-Registrar. The lower appellate Court while decreeing the suit in its entirety as already noticed herein above was swayed by the fact that plaintiff as mother-in-law of first defendant intended to save the suit property from falling into the hands of third parties and to retain the same in the family that is in favour of her daughter and her children she had entered into an agreement of sale with first defendant as per Ex.P2. However, a complete go by has been given by the first appellate Court to the fact that even prior to the agreement of sale dated 12.08.1999 21 Ex.P2 first defendant and his wife who were at loggerheads had settled their dispute as per Ex.P7 and P8 in O.S.No.104/1996 and first defendant was recognized to be owner in possession of 5 acres in Sy.No.69, which included suit schedule property which had fallen to his share. In other words, second defendant knew that dispute between first defendant and his wife had been resolved and first defendant had become absolute owner of suit schedule property and he was exercising his right of ownership over the suit property. It is because of this precise reason only plaintiff had purchased 2 acres 20 guntas from first defendant. If really plaintiff wanted to save the suit property being retained by her daughter, then she could have as well as purchased entire 5 acres instead of 2 acres only. This step was not taken by plaintiff. That apart, plaintiff had not taken any steps to get the agreement of sale published in any newspaper nor it can be said by her that second defendant had any 22 constructive notice of agreement of sale dated 12.08.1999 Ex.P2. Though plaintiff has contended that she was not in talking terms with first defendant, the fact remains that she purchased 2 acre 20 guntas in Sy.No.69 from first defendant after resolution of dispute between first defendant and his wife and alleged agreement of sale Ex.P2 also came into existence after Exs.P7 and P8 and there is no pleading or evidence as to when plaintiff and first defendant came to talking terms. Same is silent.
20. Yet another glaring factor which cannot go unnoticed is the fact that under the agreement of sale dated 12.08.1999 Ex.P2 consideration shown for sale of suit property is Rs.25,000/-, whereas consideration that has been paid by second defendant to first defendant for purchasing suit property under the sale deed dated 19.02.2000 Ex.P3 is Rs.55,000/-. Though a feeble plea has been raised by plaintiff before the Courts below that 23 no said consideration has flown from second defendant to first defendant, such a contention cannot be accepted for reasons more than one. Firstly, a registered document prevails over any other plea as per Section 92 of the Evidence Act; secondly first defendant who is recipient of the sale consideration under sale deed Ex.P3 has not entered the witness box to deny this fact. As such, the totality of the circumstances of the case would clearly pinpoint to the fact that second defendant had taken all reasonable steps to ascertain as to whether there was any prior encumbrance over the suit property namely agreement or otherwise existing as on the date of he purchasing the suit property and the fact that first defendant's wife who was also the claimant over the suit property having been resolved in the suit O.S.No.104/1996 as per Ex.P7 and P8 it can be safely concluded that second defendant is a bonafide purchaser for value without notice of agreement of sale dated 12.08.1999 Ex.P2 and he had made all 24 reasonable queries before purchase. These aspects have received anxious consideration by the trial Court to deny the relief of specific performance in favour of plaintiff and said fact has been overlooked or ignored by the first appellate Court not only at the first instance but also when the matter came to be remanded by this Court on 27.10.2010.
21. As such, for the reasons aforestated this Court is of the view that substantial question of law requires to be answered in favour of the appellant - second defendant by concluding that the first appellate Court was not correct or justified in reversing the factual finding recorded by the trial Court whereunder it had refused to grant the relief of specific performance by exercising its discretionary power under Section 20 of the Specific Relief Act based on proper analysis of evidence tendered by parties.
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Hence, the following:
ORDER
(i) Second appeal is hereby allowed by answering the substantial question of law in favour of appellant - second defendant and against first respondent
- plaintiff.
(ii) Judgment and decree passed in R.A.No.65/2006 dated 29.10.2011 by the Senior Civil Judge (Chincholi) is hereby set aside and judgment and decree passed in O.S.No.45/2000 dated 03.09.2005 by the Additional Civil Judge (Junior Division) Chincholi is hereby restored.
(iii) No order as to costs.
Registry is directed to transmit the records to the jurisdictional Courts forthwith.
Sd/-
JUDGE swk