Allahabad High Court
Ram Prakash vs Baddal Husain on 4 May, 2007
Equivalent citations: AIR2007ALL212, AIR 2007 ALLAHABAD 212, 2007 (5) ALL LJ 740, 2008 (1) AJHAR (NOC) 101 (ALL.) = AIR 2007 ALLAHABAD 212, 2008 (1) AKAR (NOC) 27 (ALL.), 2007 A I H C 3672, (2007) 3 ALL RENTCAS 169, (2007) 68 ALL LR 393
Author: Dilip Gupta
Bench: Dilip Gupta
ORDER Dilip Gupta, J.
1. This Second Appeal has been filed by defendant No. 2 for setting aside the judgment and decree passed by the learned Vth Additional District Judge, Shahjahanpur whereby the Civil Appeal, that had been filed for setting aside the judgment and decree passed by the learned IIIrd Additional Munsif, Shahjahanpur dismissing the Suit of the plaintiff for specific performance, has been allowed.
2. The Original Suit had been filed for decree of specific performance with the allegation that the agreement for sale was made between the plaintiff and defendant No. 1 Imami on 22-3-1975 for transfer of 3/ 4th share in the house for a sum of Rs. 1000/-; that the defendant No. 1 received the entire amount and the sale-deed was to be executed by 22-3-1976; that possession was also handed over to the plaintiff and even though the plaintiff has always been ready and willing to execute the sale-deed but defendant No. 1 evaded the execution and ultimately a Registered notice was sent by the plaintiff to defendant No. 1 on 1-9-1975 fixing 15-9-1975 for execution of the sale-deed; that defendant No. 1 without the knowledge of the plaintiff, executed a sale-deed in favour of defendant No. 2 on 9-9-1975 about which the plaintiff came to know on 22-9-1975 and that the said sale-deed was collusive and without consideration.
3. Defendant No. 1 Imami admitted the execution of the agreement to sell in favour of the plaintiff and also the receipt of Rs. 1000/- towards the sale consideration but contended that defendant No. 2 Ram Prakash fraudulently obtained the sale-deed on 9-9-1975 from him. Defendant No. 2 also filed a written-statement alleging that on 12-10-1974 defendant No. 1 had already executed an agreement to sell in his favour for transferring the house for a sum of Rs. 2000/- and had received a sum of Rs. 1500/ - as earnest money and balance amount of Rs. 500/- on 9-9-1975 when the sale-deed was executed in his favour by defendant No. 1. It was also alleged that the agreement to sell that had been set up by defendant No. 1 with the plaintiff who was his nephew was collusive and a fictitious transaction.
4. The Trial Court held that the agreement to sell said to have been executed by defendant No. 1 in favour of the plaintiff was a fictitious transaction and the agreement to sell dated 12-10-1974 executed by defendant No. 1 in favour of defendant No. 2 and the subsequent sale-deed executed by defendant No. 1 in favour of defendant No. 2 which was registered on 9-9-1975 were genuine transactions and defendant No. 2 was a bona fide purchaser for value without notice. The suit was, accordingly, dismissed.
The Lower Appellate Court, however, recorded contrary findings that defendant No. 1 executed the agreement to sell on 22-3-1975 in favour of the plaintiff for transferring the disputed house to the plaintiff for a sum of Rs. 1000/-; that defendant No. 1 did not execute any agreement to sell on 12-10-1974 in favour of defendant No. 2 and that defendant No. 2 was not a bona fide purchaser for value without notice. The Lower Appellate Court, therefore, concluded that the plaintiff was entitled to a decree of specific performance. The Civil Appeal was allowed and the judgment and decree of the Trial Court was set aside. It was further ordered that both the defendants shall execute the sale-deed in favour of the plaintiff within a period of one month failing which the plaintiff shall have a right to get the sale-deed executed through the process of the Court.
5. I have heard Sri Ranian Srivastava, learned Counsel for the appellant but no one has appeared for the respondents, even though the list had been revised.
6. The substantial questions of law, that had been framed at the time of admission of the Second Appeal, are as follows:
(1) Whether the Suit was rightly decreed on the basis of the terms set up by the plaintiff?
(2) Whether on the facts and circumstances of the case, the judgment of the Lower Appellate Court is in accordance with law?
7. Learned Counsel for the appellant submitted that the findings recorded by the Lower Appellate Court are illegal and perverse and deserve to be set aside. Elaborating his submission, he contended that defendant No. 1 Imami had executed the agreement to sell in favour of defendant-appellant No. 2 on 12-10-1974 and subsequently the sale-deed was also executed and registered on 9-9-1975 in his favour and he is a bona fide purchaser for value without notice of the alleged agreement dated 22-3-1975. He also contended that the agreement to sell said to have been executed by defendant No. l on 22-3-1975 in favour of the plaintiff who was his close relation was a fictitious transaction that had been made only for the purpose of getting out of the registered sale-deed executed by defendant No. 1 in favour of defendant No. 2.
8. The basic points that arise for consideration and which had also been framed by the Lower Appellate Court are as follows:
(1) Whether defendant No. 1 Imami executed the agreement to sell in favour of the plaintiff on 22-3-1975 for transferring the property for Rs. 1000/-?
(2) Whether defendant No. 1 Imami executed the agreement to sell in favour of defendant No. 2 Ram Prakash on 12-10-1974 for transferring the property for a sum of Rs. 2000/-?
(3) Whether defendant No. 2 Ram Prasad is a bona fide purchaser for value and without notice?
Issue Nos. 1, 2, 3, 4 and 5 framed by Trial Court cover the aforesaid three points and the said issues are as follows:
(1) Whether the defendant No. 1 made any agreement to sell the disputed property to plaintiff on 22-3-1975 and delivered possession in part performance of contract as alleged in the Plaint?
(2) Whether defendant No. 1 committed a breach of agreement and in collusion with defendant No. 2 sold the property to him?
(3) Whether defendant No. 2 had notice of the agreement dated 22-3-1975 and the sale deed dated 9-9-1975 is fictitious and void?
(4) Whether defendant No. 1 had made any prior agreement to sell the property on 12-10-1974 in favour of defendant No. 2 as alleged in Para 1 of Written Statement? If so, its effect?
(5) Whether defendant No. 1 is a bona fide purchaser for value without notice of the plaintiffs claim?
Bona Fide Purchaser Without Notice-
9. There is a dispute between the parties regarding the execution of the agreements dated 12-10-1974 and 22-3-1975 but what is not in dispute is the registration of the sale deed executed by defendant No. 1 in favour of defendant No. 2 on 9-9-1975. In my opinion the most crucial point that arises for consideration in this Appeal is whether defendant No. 2 is a bona fide purchaser for value and without notice because if it is so, then the Suit for specific performance cannot be decreed.
10. The Lower Appellate Court had framed this as point No. 3 issue for determination and the Trial Court had also framed Issue Nos. 2 and 5 in this regard. This issue is referable to Section 19(b) of the Specific Relief Act, 1963 (hereinafter referred to as the 'Act"). Section 19 of the Act provides that except as otherwise provided by Chapter II, Specific performance of a contract may be enforced against (a) either party thereto; (b) any other person claiming under him by a title arising subsequently to the contract, except a transferee for value who has paid his money in good faith and without notice of the original contract. It has, therefore, to be determined whether defendant No. 2 was a transferee for value who had paid his money in good faith and without notice of the original contract.
11. The Trial Court decided this issue in favour of defendant No. 2 and against the plaintiff holding that the defendant No. 2 had no knowledge of the agreement dated 22-3-1975. It was observed that the plaintiff had not filed any evidence to show that defendant No. 2 had notice of the agreement dated 22-3-1975 prior to the registration of the sale-deed dated 9-9-1975. It also noticed that though the plaintiff claimed that he had filed an application on 9-9-1975 before the Sub-Registrar that the sale deed should not be executed by defendant No. 1 in favour of defendant No. 2 as there was an existing agreement of sale in his favour, yet he did not state that he had sent any notice to the defendant No. 2 that he should not execute the sale-deed as there was an agreement dated 22-3-1975 in his favour.
12. The Lower Appellate Court, however, reversed this finding merely on the presumption that as defendant No. 2 had gone to the Sub-Registrar Office on 9-9-1975 for registration of the sale-deed he should be having notice of the agreement dated 22-3-1975 since the plaintiff had filed the application before the Sub-Registrar on that date in which a mention was made about the said agreement.
13. Section 19(b) of the Act clearly provides that a suit for specific performance shall not be decreed where the transferee for value has paid his money in good faith and without notice of the original contract. It has, therefore, to be determined whether defendant No. 2 had paid money to defendant No. 1 in good faith while executing the sale deed and whether defendant No. 2 had notice of the agreement dated 22-3-1975 said to have been executed by defendant No. 1 in favour of the plaintiff.
14. The Supreme Court in Jagan Nath v. Jagdish Rai and Ors. elaborately dealt with this issue and observed as follows (Paras 9, 10):
The aforesaid resume of facts makes it very clear that the real question in controversy between the parties which now survives for consideration is whether defendant No. 4's predecessor-in-interest defendant No. 2 was a bona fide purchaser for value without notice of the suit agreement. If the answer to this question is in the affirmative nothing further would survive in this appeal.
In order to appreciate the rival contentions centering round this limited controversy it is necessary to note the well settled legal position governing the same. Section 19 of the Specific Relief Act, 1963 lays down that, 'except as otherwise provided by this Chapter, specific performance of a contract may be enforced against - (a) either party thereto; (b) any other person claiming under him by a title arising subsequently to the context, except a transferee for value who has paid his money in good faith and without notice of the original contract;. We are not concerned with other sub-clauses of Section 19. It is not in dispute between the contesting parties that defendant No. 2 was partly claiming through defendant No. 1 who is a party to the suit agreement and was partly through defendant No. 3 who in his turn was claiming through defendant No. 3 who was admittedly party to the suit agreement. As ultimately the entire suit property came to be vested in defendant No. 2 prior to the date of the suit, the moot question examined by the trial Court as well as by the Appellate Court as to whether defendant No. 2 was a transferee for value without notice of the original contract requires resolution in the light of the evidence on record. It is well settled that the initial burden to show that the subsequent purchaser of suit property covered by earlier suit agreement was a bona fide purchaser for value without notice of the suit agreement squarely rests on the shoulders of such subsequent transferee. In the case of Bhup Narain Singh v. Gokul Chand Mahton AIR 1934 PC 68 the Privy Council relying upon earlier Section 27 of the Specific Relief Act of 1877 which is in pari materia with Section 19(1)(b) of the present Act, made the following pertinent observations at page 70 of the Report in this connection:
Section 27 lays down a general rule that the original contract may be specifically enforced against a subsequent transferee, but allows an exception to that general rule, not to the transferor, but to the transferee, and therefore it is, for the transferee to establish the circumstances which will allow him to retain the benefit of a transfer which prima facie, he had no right to get:
However, it has to be kept in view that once evidence is led by both the sides the question of initial onus of proof pales into insignificance and the Court will have to decide the question in controversy in the light of the evidence on record. Even this aspect of the matter is well settled by a decision of Privy Council in the case of Mohammad Aslam Khan v. Feroze Shah AIR 1932 PC 228 wherein it was observed with reference to the very same question arising under Section 27 (b) of the earlier Specific Relief Act of 1877 that it is not necessary to enter upon a discussion of the question of onus where the whole of the evidence in the case is before the Court and it has no difficulty in arriving at a conclusion in respect thereof. Where a transferee has knowledge of such facts which would put him on inquiry which if prosecuted would have disclosed a previous agreement, such transferee is not a transferee without notice of the original contract within the meaning of the exception in Section 27 (b).
(Emphasis supplied)
15. After having laid down the aforesaid "guiding principles, the Supreme Court examined the evidence on record and concluded that defendant No. 2 was a bona fide purchaser for value without notice of the suit agreement and in coming to the said conclusion, the Supreme Court noticed that even the plaintiff in his examination, did not make a mention that the transactions between defendant Nos. 2 and 3 were entered into with knowledge of the suit agreement to sell in favour of the plaintiff.
16. In yet another case in Zorawar Singh and Anr. v. Sarwan Singh (Dead) by L.Rs. and Anr. , the Supreme Court examined a matter of which the facts are almost similar to the facts of the present Second Appeal. The case set up by the plaintiff Sarwan Singh was that there was an agreement to sell dated 3-3-1971 with defendant No. 1 Kankar Singh but Kankar Singh sold the land to defendant No. 2 Zorawar Singh on 17-3-1971 even though the plaintiff Sarwan Singh had submitted an application before the Sub-Registrar that the land in dispute had already been agreed to be sold to him by Kankar Singh, defendant No. 1 and the defendant No. 1 was sought to be stopped from executing the sale-deed in favour of defendant Nos. 2 and 3. Sarwan Singh, therefore, filed a Suit for specific performance of contract dated 3-3-1971. The defence taken by Zorawar Singh was that the sale-deed had been executed and registered in his favour on 17-3-1971 by defendant No. 1 Kankar Singh pursuant to the agreement for sale dated 31-12-1970 and that in any view of the matter, he was a bona fide purchaser for value without notice of the agreement dated 3-3-1971. The Trial Court decreed the Suit but the First Appeal before the High Court was allowed and the Suit filed by the plaintiff for specific performance of contract was dismissed. A Letters Patent Appeal was filed by Sarwan Singh which was dismissed on 4-3-1991. Special Leave Petition was thereafter filed by Sarwan Singh in the Supreme Court. The Supreme Court, without expressing any opinion on the rival contentions of the parties, remanded the matter for a fresh disposal by the Division Bench. The Division Bench, hearing the case after remand, allowed the Letters Patent Appeal and restored the decree of the Trial Court for specific performance in favour of Sarwan Singh. The judgment was again challenged before the Supreme Court. It would be useful to reproduce the relevant portion of the judgment of the Division Bench of the High Court allowing the Letters Patent Appeal in order to appreciate the controversy and the same Is as follows.: (Para 7) All that needs to be mentioned further is that when matter came to be disposed of by the Hon'ble Supreme Court, learned counsel for the plaintiff had referred to sale deed in favour of defendants 2 and 3 that was registered on March. 17. 1971 and argued that on the same day, and before the registration was effected, plaintiff had filed an application before the Sub-Registrar stating that he had an earlier agreement in his favour and, therefore, the registration of the sale deed in favour of defendants 2 and 3 should not be effected. He further argued that on this application, an endorsement was made by the Registrar to the effect that though such an application has been filed-the parties to the sale deed insisted upon its registration and, therefore, he registered the same. It was also brought to the notice of the Hon'ble Supreme Court that Registrar was examined to prove the endorsement. It was also the case of plaintiff before the Hon'ble Supreme Court as has been mentioned in order dated January 15, 1996, that it had been specifically averred by him that the application was filed before the Sub-Registrar before the registration was effected and that such an endorsement was made. The counsel, after pointing out the facts, as detailed above, had further argued that the learned single Judge was not right in saying that the averment in the plaint was a vague plea' and that the finding of the learned single Judge that the said document is a subsequent manipulation was based on no evidence. The counsel, who represented the contesting defendants before the Hon'ble Supreme Court, however, disputed the correctness of the submissions of learned Counsel for the plaintiff and it was pointed out by him that when Zorawar Singh, defendant was in the witness box, said endorsement was not put to him. After observing, as has been mentioned above, the Hon'ble Supreme Court, thought it proper that order of Division Bench dismissed LPA No. 335 of 1983 should be set aside and matter be remitted to the High Court for fresh disposal in accordance with law. As mentioned above, the Hon'ble Supreme Court did not express any opinion on the contentions raised by the parties and directed that the matter is to be disposed of on its merits."
(Emphasis supplied)
17. After taking note of the aforesaid observation of the Division Bench of the High 'Court, the Supreme Court observed (AIR 2002 SC 1711, Para 9):
From the above observation it is clear that all that was required to be considered was as to whether the defendants Nos. 2 and 3 are the bona fide transferees for consideration without notice of the agreement to sell between the plaintiff and defendant No. 1? The High Court has also observed that it all relates to the question of fact. For appreciating the finding on the point for which the matter was remanded it would be necessary to see and consider the evidence which the parties have adduced in support of their respective cases and placed on the record. There cannot be any dispute on the point that burden of proving the fact that one is a bona fide purchaser for value without notice would lie on the person who asserts the same. But at the same time the fact which cannot be lost sight of is that the plaintiff came forward with a positive case that on the fateful day namely 17-3-1971, he went to the Tehsil and moved an application before the Sub-Registrar bringing it to his notice and to the notice of the vendee that the vendor had earlier entered into an agreement to sell, with the plaintiff. This fact is said to have been brought to the notice of all concerned before attestation of the sale deed in favour of Zorawar Singh. There is no dispute about the consideration having passed on to defendant No. 1 for transfer of the land in favour of Zorawar Singh as well as about the execution of the sale deed. The precise question for consideration will be about bona fide purchase without prior notice of the agreement of sale between the plaintiff and the defendant Kankar Singh.
In the above circumstances, no exception can be taken to the view taken by the single Judge in first appeal having not relied upon on the alleged application of the plaintiff upon which Sub-Registrar is said to have made an endorsement. Firstly, the application in original after having been received and after making an endorsement on it, it is said to have been returned to the applicant Again there is no record or entry of the same in the records of the office of the Sub-Registrar. The Sub-Registrar was examined much later while the document is supposed to have remained in the custody of plaintiff through out until filed In Court. No presumption of correctness of official act can be attached to such a document and the Sub-Registrar has not stated that the document was before him, upon which he may have identified his signatures stating that it was the same document. It was only a chance, that the plain tiff happened to be there in the Tehsil Office when he came to know about that the sale deed was going to be registered. The deed writer or the scribe, who is said to have prepared the application, has not been examined. There is an earlier agreement to sell between the defendant No. 1 Kankar Singh and vendee-defendants, which unfortunately does not find favour of even being taken notice of by the Division Bench much less appreciated.
The case of the plaintiff that vendee had prior notice of agreement to sell dated 3-3-1971 between plaintiff and Kankar Singh on the basis of the alleged application said to have been moved before the Sub-Registrar just before execution of sale deed is not made out."
(Emphasis supplied)
18. The facts involved in the present Sec old Appeal are almost similar to the facts involved in the case of Zorawar Singh AIR 2002 SC 1711 (supra). In the present case, the plaintiff filed the suit for specific performance of the contract dated 22-3-1975 said to have been executed by defendant No. 1 in favour of the plaintiff. The defence taken by defendant No. 2 was that defendant No. 1 had executed the sale-deed in his favour and the sale-deed was registered on 9-9-1975 pursuant to the earlier agreement to sell dated 12-10-1974 executed by defendant No. 1 in his favour. He also claimed that he was a bona fide purchaser for value without notice.
19. The Trial Court recorded a finding in favour of defendant No. 2 but the Lower Appellate Court reversed this finding holding that defendant No. 2 had notice of the agreement dated 22-3-1975 since the plaintiff had filed an application before the Sub-Registrar on 9-9-1975 that the sale-deed should not be executed in favour of defendant No. 2. The Lower Appellate Court, therefore, presumed that as the sale-deed was registered in favour of defendant No. 2 on 9-9-1975, he would have notice of the application dated 9-9-1975 filed by the plaintiff before the Sub-Registrar in which he mentioned about his agreement dated 22-3-1975 and, therefore, impliedly defendant No. 2 would have notice of the agreement dated 22-3-1975 executed by defendant No. 1 in favour of the plaintiff.
20. This finding of the Lower Appellate Court cannot be sustained as it is based solely on conjectures and surmises without there being any evidence on the record. The plaintiff in his examination merely stated that he had filed the application before the Sub-Registrar on 9-9-1975 that the sale-deed executed by defendant No. 1 in favour of defendant No. 2 may not be registered. He does not state at all that defendant No. 2 had knowledge of the filing of this application or that defendant No. 2 was present before the Sub-Registrar when this application was filed.
21. This apart, there is nothing on the record to even suggest as to whether the said application was filed by the plaintiff prior to the registration of the sale-deed or after the registration of the sale-deed and no official in the office of the Sub-Registrar has been examined by the plaintiff to prove that the application was filed or that defendant No. 2 had been informed of this fact at the time of the registration of the sale-deed. The Lower Appellate Court, therefore, was not justified in drawing an inference from the aforesaid circumstances that defendant No. 2 had notice of the agreement dated 22-3-1975. The Supreme Court in the case of Zorawar Singh AIR 2002 SC 1711 (supra) in this context clearly observed that it was imperative for the plaintiff to have proved that the transferee had notice of the earlier agreement. Mere filing of a certified copy of the application dated 9-9-1975 before the Trial Court does not help the plaintiff at all in such circumstances. It needs to be noticed that though the plaintiff states that he had filed an application before the Sub-Registrar on 9-9-1975 since he came to know that the sale-deed executed by defendant No. 1 in favour of defendant No. 2 was going to be registered but he does not state that he had sent any communication to defendant No. 2 to bring to his notice the execution of the agreement dated 22-3-1975 said to have been executed by defendant No. 1 in favour of the plaintiff. There is no other evidence on the record which may even remotely indicate that defendant No. 2 had notice of the agreement dated 22-3-1975. The finding to the contrary recorded by the Lower Appellate Court cannot, therefore, be sustained and is set aside and it is held that defendant No. 2 had no notice of the agreement dated 22-3-1975 said to have been executed by defendant No. 1 in favour of the plaintiff.
22. The other issue, which requires to be considered is whether defendant No. 2 had purchased the property for valuable consideration. It needs to be stated that earlier at the time of execution of the agreement to sell on 12-10-1974 defendant No. 2 had paid Rs. 1500/- as earnest money out of the total consideration of Rs. 2000/-. The Lower Appellate Court has observed that defendant No. 2 could not prove that the balance amount of Rs. 500/- was paid at the time of registration of the sale-deed because in the sale-deed there is no mention of this payment. This finding also cannot be sustained. The sale-deed clearly mentions that the vendor had received the entire sale consideration of Rs. 2000/- prior to the registration of the sale-deed. In his statement defendant No. 2 (D.W. 1) clearly mentioned that he had paid the balance amount of Rs. 500/- to defendant No. 1 at his house prior to the registration of the sale-deed. The sale-deed, therefore, mentioned that the entire amount of Rs. 2000/- had been received by defendant No. 1 prior to the registration of the sale-deed. The Lower Appellate Court was, therefore, not justified in holding that the balance amount of Rs. 500/- had not been paid merely because the sale-deed does not mention that the balance amount of Rs. 500/- had been paid.
23. This apart, even if the entire amount was not paid, the sale-deed would not become invalid. In this connection reference may be made to the provisions of Section 54 of the Transfer of Property Act, 1882 (hereinafter referred to as the 'Act'). This aspect was considered by the Supreme Court in Vidhyadhar v. Manikrao and Anr. and it was observed:
The definition indicates that in order to constitute a sale, there must be a transfer of ownership from one person to another, i.e., transfer of all rights and interests in the properties which are possessed by that person are transferred by him to another person. The transferor cannot retain any part of his interest or right in that property or else it would not be a sale. The definition further says that the transfer of ownership has to be for a "price paid or promised or part-paid and part-promised". Price thus constitutes an essential ingredient of the transaction of sale. The words "price paid or promised or part-paid and part-promised" indicate that actual payment of the whole of the price at the time of the execution of sale deed is not a sine qua non to the completion of the sale. Even if the whole of the price is not paid but the document is executed and thereafter registered, if the property is of the value of more than Rs, 100/-, the sale would be complete.
There is a catena of decisions of various High Courts in which it has been held that even if the whole of the price is not paid, the transaction of sale will take effect and the title would pass under that transaction. To cite only a few, in Gayatri Prasad v. Board of Revenue 1973 All. LJ 412, it was held that non-payment of a portion of the sale price would not affect validity of sale. It was observed that part-payment of consideration by the vendee itself proved the intention to pay the remaining amount of the sale price. To the same effect is the decision of the Madhya Pradesh High Court in Sukaloo v. Punau .
The real test is the intention of the parties. In order to constitute a "sale", the parties must intend to transfer the ownership of the property and they must also intend that the price would be paid either in praesenti or in future. The intention is to be gathered from the recital in the sale deed, the conduct of the parties and the evidence on record.
24. It is, therefore, established that defendant No. 2 was a bona fide purchaser for value and had no notice of the agreement dated 22-3-1975 said to have been executed by defendant No. 1 in favour of the plaintiff. The Suit for specific performance could not have been decreed. The judgment and decree of the Lower Appellate Court is liable to be set aside on this ground.
25. In view of the above, it is not necessary to consider the other two points, namely the execution of the agreement to sell dated 22-3-1975 and the execution of the agreement dated 12-10-1974 but as would be seen, even the findings recorded by the Lower Appellate Court on both these points has to be set aside.
AGREEMENT DATED 22-3-1975
26. This point relating to the agreement to sell dated 22-3-1975 said, to have been executed by defendant No. 1 in favour of the plaintiff is covered by issue Nos. 1 and 2 of the Trial Court and point No. 1 framed by the Lower Appellate Court.
27. The Trial Court noticed both P. W. 1 and P. W. 2 had stated that the agreement executed by defendant No. 1 in favour of the plaintiff was on a plain paper on which two stamps were fixed even though it should have been on a stamp paper. The Trial Court also noticed that the other agreement to sell said to have been executed by defendant No. 1 in favour of defendant No. 2 on 10-10-1974, had been executed on a Stamp paper for a consideration of Rs. 2000/- and subsequently the sale-deed was also executed on 9-9-1975 in the Registrar's office. The Trial Court also noticed that on 9-9-1975 the plaintiff had also filed an application before the Sub-Registrar that the sale-deed in favour of defendant No. 2 by defendant No. 1- may not be registered as defendant No. 1 had executed the agreement to sell the property in his favour but in this application the value of the property was mentioned at Rs. 5000/- while in the agreement to sell dated 22-3-1975, the value of the property was Rs. 1000/- only. The Trial Court also noticed that if the agreement to sell had actually been executed by the defendant No. 1 in favour of the plaintiff, then it would have been written on a stamp paper but it was not so and nor any explanation had been offered by defendant No. For the plaintiff as to why it was not written on a stamp paper.
28. The Trial Court also noticed that the plaintiff was the nephew of defendant No. 1 and if defendant No. 1 had taken any money from the plaintiff and had executed the agreement, there was no reason for defendant No. 1 to execute the sale-deed in favour of a total stranger subsequently. From all this, the Trial Court concluded that the agreement to sell dated 22-3-1975 had been written on a back date in favour of the plaintiff after the registration of the sale-deed on 9-9-1975 in favour of defendant No. 2 and that there was collusion between the plaintiff and defendant No. 1. It, therefore, held that the said agreement to sell was a false and fictitious document and possession was also not given to the plaintiff.
29. The Lower Appellate Court, however, observed that though it is true that the agreement dated 22-3-1975 executed by defendant No. 1 in favour of the plaintiff was on a plain paper and not on the stamp paper but no objection was raised by the defendant and the Trial Court also did not examine the document from this aspect.
30. The Lower Appellate Court also observed that since P. W. 2, who was a 'Sarpanch of the Nyaya Panchayat', had stated about the execution of the said agreement, there was no reason to disbelieve him since he was a man of status The Lower Appellate Court also 30 placed reliance upon the notice dated 1-9-1975 sent by the plaintiff to defendant No. 1 to execute the sale-deed fixing 15-9-1975 since in this notice the plaintiff specifically mentioned that the agreement to sell had been executed on 22-3-1975. It also noticed that on 9-9-1975 the plaintiff also filed an application before the Sub-Registrar and in this application he had also mentioned that an agreement in his favour had been executed on 22-3-1975. The Lower Appellate Court therefore, found that the findings the Trial Court were incorrect.
31. A perusal of the Plaint shows that -the plaintiff clearly mentioned that he acquired knowledge of the sale-deed executed by defendant No. 1 in favour of defendant No. 2 on 22-9-1975. This statement is incorrect inasmuch as the plaintiff had moved an application before the Sub-Registrar on 9-9-1975 clearly mentioning that the sale-deed executed by defendant No. 1 in favour of defendant No. 2 should not be registered since there was an existing agreement to sell in his favour. It has to be noticed that no explanation whatsoever had been given by the plaintiff or defendant No. 1 as to why the agreement was written on a plain paper when it was required to be executed on a Stamp Paper. The Lower Appellate Court committed a patent error in observing that no objection was raised by defendant No. 2 before the Trial Court regarding the execution of the agreement dated 22-3-1975 on a plain paper and that the Trial Court also did not examine this aspect, as a perusal of the judgment of the Trial Court clearly shows that such an objection was raised by defendant No. 2 and the Trial Court also considered this issue while rejecting the claim of the plaintiff. The fact that defendant No. 1 executed the sale-deed in favour of defendant No 2 on 9-9-1975 clearly leads to the conclusion, as had also been drawn by the Trial Court, that the agreement dated 22-3-1975 was subsequently written on a plain paper. The Lower Appellate Court has not reversed the finding given by the Trial Court that the plaintiff and defendant No. 1 who were uncle and nephew had colluded so as to deprive defendant No. 2 of the fruits of the registered sale deed. It has, therefore, to be held that the Lower Appellate Court committed an illegality in reversing this finding of the Trial Court.
Agreement dated 12-10-1974
32. The point that arises for determination is whether defendant No. 1 had executed the agreement of sale in favour of defendant No. 2 Ram Prakash on 12-10-1974. The Trial Court had examined this as Issue No. 4 which issue was decided along with issue Nos. 3 and 5 while the Lower Appellate Court examined it as point No. 2. The Trial Court noticed that the said agreement was on a valid stamp paper; that defendant No. 1 had filed a written-statement in favour of the plaintiff who was his uncle which clearly shows that they were in collusion and the entire purpose was to get rid of the sale-deed executed by defendant No. 1 in favour of defendant No. 2. The Lower Appellate Court got swayed by the fact that the sale-deed did not mention about this agreement, that the stamp paper on which the agreement was written was purchased from Shahjahanpur while the agreement was executed in Tehsil Powayan where stamp paper was also available; that the stamp paper was purchased on 10-10-1974 while the agreement was prepared on 12-10-1974 and that there was inconsistency in the statement of the D.W. 1 Ram Prakash regarding the purchase of stamp paper as in the cross-examination he initially stated that it was only a day before in the evening that he had talked with the defendant regarding the agreement and at that time he purchased the stamp paper while subsequently he stated that it was purchased 3-4 days there-, after.
33. In my opinion, the Lower Appellate Court has disbelieved the execution of the agreement dated 12-10-1974 on absolutely frivolous grounds. Delay of two days in purchasing the stamp paper and executing the agreement to sell cannot be made a ground to disbelieve the execution of the agreement and neither was there any bar in purchasing the stamp paper from Shahjahanpur and executing the agreement in its Tehsil. The non-mention of the agreement to sell in the sale-deed is also not of any relevance. A minor discrepancy in the statement of D. W. 1 as to the date of purchase of the Stamp paper cannot be made a ground to disbelieve the execution of the agreement dated 12-10-1974. The Lower Appellate Court, therefore, fell in error in holding that the agreement to sell was not executed by defendant No. 1 in favour of defendant No. 2 on 12-10-1974.
34. In view of the aforesaid, the Second Appeal is liable to be allowed and is accordingly allowed The judgment and decree of the Lower Appellate Court is set aside and that of the Trial Court is restored. The parties shall bear their own costs.