Karnataka High Court
Sri A.R. Oomar Sait S/O Late A.R. Rehman ... vs Sri B.S. Rajanna S/O Late Singachar on 21 March, 2007
Equivalent citations: 2008(1)KARLJ134, AIR 2008 (NOC) 195 (KAR.) = 2007 (6) AIR KAR R 43, 2008 A I H C 261, 2007 (6) AIR KAR R 43, (2007) 2 RENTLR 653, (2007) 4 ICC 785, (2008) 1 KANT LJ 134, (2008) 1 RENCR 341
Author: K. Ramanna
Bench: K. Ramanna
ORDER K. Ramanna, J.
Page 2234
1. This revision petition is filed by the revision petitioners - landlords against the Order on I.A. No. 6, dated 26.07.2006 passed by the VII Additional Judge, Court of Small Causes, Bangalore, (SCCH-3) in HRC No. 486/2005, whereby the Trial Court allowed the application-I.A. No. 6 filed by the respondent under Section 43(2)(b) of the Karnataka Rent Act read with Section 151 of Civil Procedure Code.
2. The main grounds urged by the revision petitioners are that the Trial court erred in holding that since agreement of sale is executed between the revision petitioners and the respondent in respect of purchase of petition schedule property, the earlier possession of tenant is deemed to be terminated; that the agreement of sale is barred by limitation and the agreement came to be cancelled much earlier and there was no suit pending for enforcement of the contract even on the date of HRC petition; that the Trial Court has not properly appreciated in holding that if the respondent has failed in complying with any terms of the agreement his possession will became unlawful possession and in that event revision petitioners have to approach the Civil Court to recover the possession. Hence, this revision.
3. I have heard the arguments of the learned Senior Counsel for the petitioners and learned Counsel for the respondent and perused the material placed on record.
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4. It is contended that the revision petitioners are the owners of the petition schedule properties including the property, which was agreed to be sold in favour of the respondent on 20.09.1997. The respondent has not complied with the terms of the agreement by not paying the entire sale consideration amount on or before 20.03.1988. The time is the essence of the contract. Since the respondent failed to pay the entire sale price on or before 20.03.1988, automatically the revision petitioners are in no obligation to comply with the agreement of sale dated 28.09.1987. Therefore, even if any suit has been filed by the respondent, that too after lapse of six years, such a suit seeking the prayer for specific performance is not at all maintainable. It is argued that prior to the execution of the said agreement of sale, the respondent was a tenant under the revision petitioners from 1982 onwards. Therefore, if once the respondent who was a tenant under the revision petitioners subsequently entered into an agreement if he fails to comply the terms of the agreement, then he is in no way entitled to contend that there is no relationship of landlord and tenant. The relationship of landlord and tenant exists between the revision petitioners and the respondent. Since the respondent has violated the terms of the agreement, he should deemed to be a tenant under the revision petitioners. Therefore, the finding recorded by the Trial court that there is no jural relationship of landlord, and tenant between the revision petitioners and respondent is totally incorrect, perverse and illegal. It is further argued that if the respondent has paid any amount after 20.09.1988, under the provisions of Karnataka Rent Act, he should have issued a notice to the revision petitioners calling upon them to execute a sale dead in his favour. Since there is no compliance of the agreement of sale, he cannot contend before the Rent Court that there is no relationship of landlord and tenant between them. It is contended that a petition under Section 43(2)(b) of Karnataka Rent Act, came to be filed. When the matter was listed for cross-examination of P.W.1-the landlord, the respondent has taken the contention that he has paid the remaining sale consideration amount after 1988 and took symbolic possession of the remaining portion of the petition schedule property which is in occupation of other tenants as per the terms of the agreement. On the other hand, it is contended by the revision petitioner that the relationship of landlord and tenant still exists. Hence, the Order passed by the Trial Court does not survive, and that the respondent has already filed a suit, whereas it was actually filed by the respondent the suit in the year 2006 in O.S. No. 5602/06. Therefore, the impugned order is liable to be set aside.
5. In support of these contentions, the learned Counsel appearing for the revision petitioners relied on the decision of the Division Bench of this Court reported in Kareem Baig v. Dr. Mohammad Khisar Hussain , wherein it is held as under:
(i) For the purpose of invoking the doctrine of equity of part-performance as embodied in Section 53-A of the T.P. Act, apart Page 2236 from proving the agreement of sale it must also be proved that the transferee, has in part-performance of the contract, taken possession of the property or any part thereof or in the case of the transferee being already in possession continues in possession in part-performance of the contract and has done some act in furtherance of the contract.
(ii) The doctrine of part-performance is a doctrine of equity. Delay defeats equity. Therefore, when the agreement of sale becomes unenforceable by reason of the Law of Limitation, the defence of part-performance founded on the agreement cannot be permitted to be enforced as the agreement has lost all its efficacy inasmuch as the right to enforce it is lost by the Law of Limitation. The doctrine of part-performance which is a doctrine of equity cannot be permitted to be invoked under these circumstances.
He has also relied on another decision of Hon'ble Apex Court in case of Deva Sahatam (D) By Lrs. v. P. Savithramma and Ors. 2005 Vol. VII Supreme Laws Today 459, wherein it is held as follows:
20. So read, the plaintiff in its plaint merely ascribed that he continued to be in possession of the tenanted premises after the oral agreement of sale was entered into by and between the parties pursuant to or in furtherance thereof. It has not been and could not have been the contention of the appellant that he has derived title as a vendee in respect of the premises in question. Such a plea, in view of Section 54 of the Transfer of Property Act, was not available. He at best could raise a claim of possession of the said premises in part performance of contract as envisaged under Section 53-A thereof.
He has also relied on another decision of Division Bench of the Hon'ble Supreme Court in P. Veerappa v. M.A. Mohammed Amanulla , wherein it has been held that landlord entering into agreement of sale with appellant-tenant, agreement coming into an and due to non-compliance with terms of agreement by tenant, pre-existing rights of appellants as tenant stood revived. Merely because he had entered into an agreement his tenancy rights, it cannot be said to have merged with rights of an agreement-holder, the eviction proceedings for arrears of rent would lie against him. He has also relied on the decision of the supreme Court reported in the case of Shashi Kapila v. R.P. Ashwin . While deciding the matter, the Apex Court relying on the decision rendered in , stated supra, held as under:
Eviction sought to be resisted by tenant on basis of agreement of sale executed by landlord with partnership firm of which he is one of the Page 2237 partners - Tenant however not able to project himself as partner of firm nor as transferee of agreement - Tenant cannot individually claim all rights of firm - Tenancy rights are available to the tenant individually over which the partnership has no claim -Landlord cannot be non suited on strength of said agreement under Section 53-A of T.P. Act.
6. On the other hand, the learned Counsel for the respondent contended that the eviction petition is filed by the revision petitioners, by ignoring the agreement of sale entered into between revision petitioners and respondent. Respondent earlier was a tenant under revision petitioners in respect of the petition schedule property. Since the respondent has entered into an agreement of sale in respect of petition schedule property for a sum Rs. 8,00,000/-, he ceases to be a tenant. A sum of Rs. 1,02,001/-, was paid as advance to the revision petitioners. By way of pay order the respondent has paid a sum of Rs. 1,00,000/- and a sum of Rs. 2,001/- by cash. Subsequently he paid Rs. 4,98,000/- towards the balance consideration amount to one of the revision petitioners. Therefore, a suit was filed by the respondent for specific performance of the agreement of sale within time. It is further contended by the learned Counsel for the respondent that as per the terms of the agreement, the revision petitioners failed to register the petition schedule property in favour of the respondent. Therefore, it is contended that the Trial Court is right in holding that there is no jural relationship of landlord and tenant between the revision petitioners and respondent.
7. In support of the contentions, the learned Counsel for the respondent relied on the decisions rendered in Ayesha Begum v. Shahsadi 2003 (1) KCCR 365; Sri. A.M. Malloegowda v. Sri. Kariyappa Gowda 2004 (1) KCCR 143 wherein this Court held that in respect of disputed relationship of landlord and tenant, it applies only to the proceedings before the original Court and not to the proceedings pending in revision. He has also relied on the decision in Y. Abdulla Kunhi and Anr. v. B. Ibrahim 2005 (4) KCCR 2530 wherein it is held that the Court should prima facie satisfy as to the evidence of relationship and proceed to hear the case. Hence, he prayed to dismiss the revision petition.
8. As could be seen from the records the respondent had entered into an agreement of sale on 20.09.1997 agreeing to purchase the entire 'A' Schedule Property bearing No. 3/124 situated at I cross, H.M. Road, Lingarajapuram, Bangalore - 84. It is an undisputed fact that the respondent is in occupation of the petition schedule property. The remaining portion of the property was in occupation of other tenants in the year 1982. The agreement of sale was entered into between the revision petitioners and respondent on 20.09.1997. Prior to that he was a tenant in respect of the petition schedule property. As par the terms of the agreement, the transaction of sale should be completed within 20.03.1998. Time for compliance is the essence of the contract. As could be seen from the records that the respondent herein is stated to have paid the balance of consideration amount to one of the revision petitioners. But he has not got a registered sale deed on or before 20.03.1998.
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9. It is also an undisputed fact that the respondent herein neither paid the balance of sale consideration amount on or before 20.03.1998 nor issued a notice under Section 106 of the Transfer of Property Act to the revision petitioners. Moreover, he is not in possession of the major portion of the property, which belongs to the revision petitioners. He is said to have paid the sale price on various dates. If once a tenant in occupation of the premises subsequently entered into an agreement of sale there will be change in the relationship of landlord and tenant. But considering the decisions rendered by the Apex court in the case of Shashi v. R.P. Ashwin , the eviction sought to be resisted by a tenant on the basis of agreement of sale executed by the landlord with partnership firm, wherein the tenant cannot individually claim all rights of the firm and the tenancy rights are available to the tenant individually over which the partnership has no claim, which has no application to the facts of this case. In the earlier judgment it is held that merely because he had entered into an agreement his tenancy rights cannot be said to have merged with rights of an agreement-holder the pre-existing rights of appellants as tenant stood revived. In the instant case, the respondent was a tenant right from the year 1982 and in the year 1997 he entered into an agreement of sale without taking possession of the petition schedule property. Even he has not made the payment of balance of sale consideration on or before 20.03.1998 and the balance of consideration is said to have been paid on different dates. Therefore, the Trial Court has committed a grave error in recording its finding that the respondent is in possession of the petition schedule property in the capacity of a purchaser under the agreement of sale. In view of the law laid down by the Apex Court and by this Court and till the respondent proves that he is in possession of the entire petition schedule property under the agreement of sale and that he has paid the entire sale consideration amount within the stipulated period, he cannot be termed as the owner of the property and he continues to be a tenant.
10. As could be seen from the material on record it is clear that when the matter was listed for cross-examination of P.W.1, respondent has filed an application with statement of objections, which amounts to protracting of the proceedings.
11. Hence, the Revision petition is allowed. The impugned order dated 26.07.2006 passed by the VII Additional Judge of court of small Causes, Bangalore, in HRC No. 486/05 is hereby set aside and the respondent - tenant is directed to cross-examine P.W.1 without any loss of time.