Karnataka High Court
Nagaraj S/O Somanna Hubballi vs Shobhatai W/O Gopalrao Kulkarni on 13 October, 2023
-1-
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
DATED THIS THE 13TH DAY OF OCTOBER, 2023
BEFORE
THE HON'BLE MR JUSTICE ANANT RAMANATH HEGDE
REGULAR FIRST APPEAL NO. 100126 OF 2014 (PAR/POS)
C/W
REGULAR FIRST APPEAL NO. 100164 OF 2016
IN RFA NO.100126/2014:
BETWEEN:
NAGARAJ S/O SOMANNA HUBLI,
AGE: 47 YEARS, OCC: AGRICULTURE,
R/O: VINAYAK NAGAR, RANEBENNUR,
DIST: HAVERI.
...APPELLANT
(BY SRI. PRASHANT S. HOSAMANI, ADVOCATE)
AND:
1. SUVESHA D/O GOPAL RAO KULKARNI,
AGE: 26 YEARS, OCC: STUDENT,
R/O: ASUNDI, TQ: RANEBENNUR,
DIST: HAVERI.
MOHANKUMAR
B SHELAR 2. SHRUTHI D/O GOPAL RAO KULKARNI,
AGE: 24 YEARS, OCC: STUDENT,
Digitally signed
by
MOHANKUMAR R/O: ASUNDI, TQ: RANEBENNUR,
B SHELAR
Date: 2023.10.30
10:26:40 +0530
DIST: HAVERI.
3. GOPAL RAO S/O SUBBAJI KULKARNI,
AGE: 57 YEARS, OCC: AGRICULTURE,
R/O: ASUNDI, TQ: RANEBENNUR,
DIST: HAVERI.
4. SMT. SHOBHABAI W/O GOPAL RAO KULKARNI,
AGE: 45 YEARS,
OCC: AGRICULTURE AND HOUSEHOLD,
R/O: ASUNDI, TQ: RANEBENNUR,
DIST: HAVERI.
-2-
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
5. SUVASH S/O GOPAL RAO KULKARNI,
AGE: 19 YEARS, OCC: STUDENT,
R/O: ASUNDI, TQ: RANEBENNUR,
DIST: HAVERI.
...RESPONDENTS
(BY SRI. A.S.PATIL, ADVOCATE FOR R1 AND R2;
SRI. ANAND BAGEWADI, ADVOCATE FOR R3 TO R5)
THIS RFA IS FILED UNDER SECTION 96 OF CPC 1908,
AGAINST THE JUDGMENT AND DECREE DTD:23.06.2014 PASSED
IN O.S.NO.100/2011 ON THE FILE OF THE ADDITIONAL SENIOR
CIVIL JUDGE, RANEBENNUR, DECREEING THE SUIT FILED FOR
PARTITION AND SEPARATE POSSESSION.
IN RFA NO.100164/2016:
BETWEEN:
NAGARAJ S/O SOMANNA HUBBALLI
AGE: 52 YEARS, OCC: AGRICULTURIST AND BUSINESS,
R/O: BANDEKAL CHAWL, RAJESHWARI NAGAR,
IST CROSS, RANEBENNUR,
DIST: HAVERI-581115.
...APPELLANT
(BY SRI. PRASHANT HOSMANI, ADVOCATE)
AND:
SMT. SHOBHATAI W/O GOPALRAO KULKARNI
AGE: 47 YEARS,
OCC: AGRICULTURE AND HOUSEHOLD WORK,
R/O: ASUNDI VILLAGE, TQ: RANEBENNUR,
DIST: HAVERI-581117.
...RESPONDENT
(BY SRI. S.G.KADADAKATTI, ADVOCATE)
THIS RFA IS FILED UNDER SEC.96 OF CPC, AGAINST THE
JUDGMENT AND DECREE DTD:11.03.2016 PASSED IN
O.S.NO.104/2011 ON THE FILE OF THE ADDITIONAL SENIOR
CIVIL JUDGE, RANEBENNUR, DECREEING THE SUIT FILED FOR
SPECIFIC PERFORMANCE OF CONTRACT.
-3-
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
THESE APPEALS, COMING ON FOR FURTHER HEARING,
THIS DAY, THE COURT DELIVERED THE FOLLOWING:
COMMON JUDGMENT
1. RFA No.100164/2016 is arising from the judgment
and decree in O.S.No.104/2011 refusing specific
performance. In terms of the impugned judgment
and decree, the trial Court granted a decree for refund
of earnest amount of Rs.9,50,000/- along with
interest at the rate of 6% p.a. from the date of suit till
realization of the amount. The plaintiff aggrieved by
the aforementioned decree granting alternative relief,
is before this Court seeking specific performance of
the agreement for sale dated 02.07.2010.
2. This appeal is clubbed with RFA No.100126/2014.
RFA No.100126/2014 is arising from the judgment
and decree in a suit for partition in O.S.No.100/2011.
In the suit for partition, the agreement holder got
himself impleaded as the 4th defendant as he came to
-4-
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
know that one of the properties in the suit for partition
is the property which he had agreed to purchase.
3. The suit for partition named above is filed by the two
daughters of one Shobhabai, W/o Gopalarao Kulkarni,
the person who entered into an agreement for sale
dated 02.07.2010. The suit is filed on the premise
that the properties are the joint family properties and
the suit is decreed holding that the plaintiffs and
defendants No.1 to 3 therein are entitled to 1/5th
share each in the suit schedule properties. The
agreement holder, who is defendant No.4 in the said
suit, is before this Court on the premise that the said
suit is collusive and filed only with an intention to
defeat the right of the agreement holder.
4. The aforementioned two appeals are by the person
who proposed to purchase the property bearing
Survey No.183/1 in a land measuring 4 acres 35
guntas on the western side.
-5-
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
5. The other facts that can be gathered from the
pleadings are as under:
5.1. The agreement for sale dated 02.07.2010 is
registered and the present appellant entered into
an agreement for sale with Shobhabai. She is the
defendant in a suit for specific performance in
O.S.No.104/2011, on the file of the Addl. Senior
Civil Judge, Ranebennur. The agreement reveals
that the sale consideration agreed to be paid is
Rs.10,04,420/- and it is further averred in the
agreement for sale that Rs.9,50,000/- is paid as
advance consideration amount.
5.2. The suit for specific performance is filed after the
plaintiff came to know about the suit for partition
filed in O.S.No.100/2011, on the file of the Addl.
Senior Civil Judge, Ranebennur by the daughters
of the vendor and as already noticed, the
purchaser got himself impleaded as defendant
No.4 in the said suit.
-6-
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
5.3. Both the suits were tried separately and the suit
for partition is decreed and suit for specific
performance is decreed for refund of the amount.
6. Learned counsel for the appellant Sri.Prashant
Hosamani, would submit that, the agreement for sale
being duly established, the trial Court could not have
given a finding that the agreement for sale is not an
agreement for sale in the true sense and it has further
committed an error in granting the decree for refund
of the amount after holding that the plaintiff has
proved his readiness and willingness to perform his
part of contract. It is also his contention that the trial
Court refused specific performance under the
assumption that the decree for specific performance
would cause hardship to the vendor. He would also
submit that the suit for partition is a collusive suit
intended to defeat the legitimate right of the
agreement holder who agreed to purchase the
property and who had paid substantial consideration
-7-
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
amount of Rs.9,50,000/- out of Rs.10,04,420/-,
agreed under the agreement.
7. Sri. S. G. Kadadakatti, learned counsel appearing for
the vendor would submit that the transaction is not a
sale transaction and the same has been noticed by
the trial Court by considering all the facts and
circumstances. He would further submit that, after
having held that the transaction is not a sale
transaction, the trial Court is justified in granting a
decree for refund of the amount.
8. This Court has considered the contentions raised at
the Bar.
9. The following points arise for consideration:
i. Whether the trial Court is justified in holding
that the agreement for sale is not an
agreement for sale in the true sense?
ii. Whether the trial Court is justified in holding
that the specific performance of the contract
would be onerous to the vendor?
-8-
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
10. As far as the first point for consideration is concerned,
it has to be noticed that, admittedly the agreement for
sale is a registered agreement. Signature on the
agreement is not disputed. The defence is, the
vendor had entered into an agreement for sale with
the sister of the plaintiff earlier to the suit agreement,
and the defendant was made to sign suit agreement
on the pretext that the earlier agreement for sale with
the sister of the plaintiff is sought to be cancelled and
they would also refer to the earlier agreement for sale
dated 02.07.2010.
11. The vendor has appeared before the Sub-Registrar on
02.07.2010. It is the case of the vendor she went to
the Sub Registrar with an understanding that she is
entering into an agreement to cancel the earlier
agreement dated 28.01.2010. If so then how one
more agreement dated 16.07.2010 cancelling the
earlier agreement for sale came to be registered is the
question. This obvious question which arises from the
-9-
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
defence of the vendor is not answered. Apart from
that, the vendor in her cross-examination has
squarely admitted the execution of the registered
agreement for sale dated 02.07.2010 and has also
admitted that she has received Rs.9,50,000/- from
the purchaser. In addition to that, the witness
examined on behalf of the vendor, namely, DW2 in his
cross-examination has admitted that the vendor's
husband was present when the document was drafted
and registered. He has also further admitted in the
cross-examination that the contents of the said
document were dictated by the husband of the
vendor. It is also forthcoming from the records i.e.,
the registered agreement for sale marked at Ex.P5,
that the husband of the vendor has identified his wife
before the Sub-Registrar. This being the position, this
Court is of the view that the agreement for sale is duly
established.
- 10 -
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
12. It is also relevant to note that, the vendor has raised
a plea of fraud and misrepresentation in the written
statement. The law requires that the details relating
to the fraud and misrepresentation have to be
furnished and this requirement under Order VI Rule 4
of the Code of Civil Procedure is an exception to the
general rule that the pleadings should be brief and
precise. Assuming that the pleadings relating to fraud
and misrepresentation are adequate, then also the
question is whether this plea of misrepresentation is
proved in accordance with law.
13. Since it is forthcoming from the evidence that the
husband of the vendor was very much present when
the document was drafted and registered. In the
absence of any other circumstance to accept
misrepresentation and also given the fact that the
document is registered, this Court is of the view that
the plea of fraud and misrepresentation and the plea
that the document was got executed on the pretext of
- 11 -
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
getting earlier agreement for sale cancelled, is not
established. This view of the Court is also supported
by the fact that, two weeks later one more agreement
was registered canceling the agreement for sale in
favour of the plaintiff's sister.
14. This Court has also analysed the reasoning assigned
by the Court to hold that the agreement for sale
though admitted in the cross-examination is not an
agreement for sale in the true sense. The trial Court
has tried to make out a case that this agreement for
sale is not an agreement for sale in the true sense in
the context that the agreement for sale was already
executed in favour of plaintiff's sister and the trial
Court has also carried away by the statement of the
plaintiff in his cross-examination, wherein he has
stated that, by the time he entered into the said
agreement marked at Ex.P5, earlier agreement for
sale by the vendor in favour of the sister was already
cancelled. The trial Court noticed that, it was not
- 12 -
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
cancelled on the date of execution of Ex.P5, but it was
cancelled two weeks later. Merely because there was
one more agreement for sale in favour of the plaintiff's
sister, when he entered into the agreement for sale
marked at Ex.P5, it does not mean that the
agreement for sale is not an oral agreement for sale.
The signature on the agreement is admitted. The plea
of fraud and misrepresentation are not proved, Thus
this Court is of the view that the finding of the trial
Court that the agreement for sale is not an agreement
for sale in the true sense is incorrect.
15. It is also required to be noticed that the trial Court has
given a finding that the plaintiff was ready and willing
to perform his part of the contract and plaintiff has
already paid substantial amount of Rs.9,50,000/- out
of Rs. Rs.10,04,420/-, which was agreed to be sold.
This being the position, the trial Court could not have
given a finding that the agreement for sale is not an
agreement for sale in the true sense.
- 13 -
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
16. Now the question is whether the trial Court is justified
in granting a decree for refund in respect of the
decree for specific performance. No doubt, merely
because the agreement is proved or merely because it
is lawful to grant a decree for specific performance,
the Court need not grant a decree for specific
performance and in appropriate cases, the Court may
decline the relief of specific performance. The power
of the Court to decline the relief of specific
performance can be traced to Section 14 as well as
Section 20 of the Specific Relief Act. In this case,
Section 14 of the Specific Relief Act has no
application. However, it appears, under Section 20 of
the Specific Relief Act, the trial Court has refused the
specific performance. Section 20 of the Specific Relief
Act contemplates the situation where the specific
performance can be declined by the trial Court.
However, Section 20 of the Specific Relief Act itself is
very clear that the decree for specific performance can
be declined in exercise of the discretionary
- 14 -
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
jurisdiction. The discretion is not arbitrary and it has
to be sound and reasonable and guided by the judicial
principles capable of correction by the Court of appeal.
That means, the case has to be made out to grant the
relief in favour of the defendant by exercising the
discretion not to grant the specific performance.
Hence this Court has to consider whether the vendor
has made out a case to exercise the jurisdiction in
favour of the vendor.
17. This Court has gone through the written statement
filed by the vendor. The written statement does not
disclose any reason as to why the specific
performance has to be declined. The written
statement is based on the total denial and the
defendant has not admitted the execution of the
agreement. In the written statement, no specific
circumstance is pleaded as to why the specific
performance should be declined and what will be the
consequence of granting the decree for specific
- 15 -
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
performance on the defendant. It is also relevant to
note that, the trial Court has not framed any specific
issue relating to the hardship, which is the basis for
the trial Court to decline the relief of specific
performance. The issue is not framed because there
was no plea and even in the evidence there is no such
evidence by the defendant.
18. It is also required to be noticed that the person who
seeks equity under Section 20 of the Specific Relief
Act on the ground of hardship has to approach the
Court with clean hands. If the facts and
circumstances of the case are taken into account, it is
very much forthcoming from the records that, despite
the suit for partition filed before the Court, the parties
are living together. This is clearly admitted in the
cross examination. Thus, the suit for partition is a
collusive suit aimed at defeating the right of the
plaintiff, who had entered into agreement for sale and
paid substantial amount to the vendor.
- 16 -
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
19. As can be noticed from the description of the
properties shown in the suit for partition, 9 acre 20
guntas is extent of suit property. Out of this Survey
No.183/1 measuring 4 acres 35 guntas including 28
guntas pot kharab land is transferred to the mother
towards her maintenance. Since this transfer to the
mother is not disputed, Section 14(1) of the Hindu
Succession Act, 1956 would apply and the said
property would be the absolute property of the
mother.
20. Thus, the suit for partition in respect of the property
in the name of mother which is subject matter of
agreement for sale is not maintainable. The trial
Court did not notice this particular aspect and has
wrongly granted decree for partition in respect of
Survey No.183/1 measuring 4 acres 35 guntas
including 28 guntas.
21. From this perspective also, the judgment and decree
passed by the trial Court granting partition in respect
- 17 -
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
of 4 acres 35 guntas in Survey No.183/1 is not
sustainable.
22. It s also relevant to note that, though the property,
which was transferred to the mother in the year 1994
vide M.E.No.135 was numbered as 183/1 when the
property was transferred, later the said property is
renumbered as 183/2 measuring 4 acres 35 guntas
including 28 guntas pot kharab land. Thus, the suit
for partition in respect of Survey No.183/2 is not
maintainable and the same is dismissed.
23. For the reasons already assigned above, the trial
Court is not justified in declining the relief of specific
performance. The trial Court ought to have granted
the relief of specific performance as the plaintiff has
proved the agreement for sale, readiness and
willingness and as the vendor has failed to establish
the case for exercising the discretion under Section 20
of the Specific Relief Act, in favour of the vendor.
- 18 -
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
24. However, it is required to be noticed that the
agreement for sale is of the year 2010. Now we are in
2023. There has been escalation in the market value
of the property.
25. Learned counsel for the appellant was directed to
furnish the present market value of the property and
copy of the guidance value issued by the Sub-
Registrar, Ranebennur, is furnished. In terms of the
said valuation certificate dated 12.10.2023, it can be
noticed that the market value of the property in the
year 2019-20, 2020-21 and 2021-22 is Rs.1,60,000/-
per acre for dry land, Rs.2,00,000/- per acre for dry
black soil land, Rs.2,60,000/- per acre for irrigated
land and Rs.4,00,000/- per acre for garden land. As
already noticed, Rs.9,50,000/- is already paid by the
purchaser out of Rs.10,04,420/-, as agreed. Thus,
the balance consideration amount payable is only
Rs.54,420/-. Since 4 acres of land is sought to be
purchased, this Court is of the view that the equity
- 19 -
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
would be balanced by directing the appellant to pay
Rs.10,40,000/- as an additional consideration amount.
This finding should not be construed as a finding to
pay balance consideration amount as per the
prevailing market value. The prevailing market value
will be much higher than the guidance value
prescribed by the Sub-Registrar. The direction is
issued to pay higher consideration amount considering
the facts and circumstances of the cases discussed
above.
26. During the course of the hearing, it is brought to the
notice of this Court that the respondent vendor has
sold the property which is the subject matter of the
suit for specific performance in favour of the third
party. Needless to say, that the sale transaction
during the pendency of the appeal is subject to the
result of the suit and the purchaser is bound by the
result of the appeal. Under the circumstances, the
- 20 -
NC: 2023:KHC-D:12446
RFA No. 100126 of 2014
C/W RFA No. 100164 of 2016
decree for specific performance will also bind the
subsequent purchaser.
27. Hence the following:
ORDER
i. The RFA No.100126/2014 and 100164/2016 are allowed in part.
ii. The impugned judgment and decree dated 11.03.2016, passed in O.S.No.104/2011 on the file of Senior Civil Judge, Ranebennur are set aside.
iii. The impugned judgment and decree dated 23.06.2014, passed in O.S.No.100/2011 on the file of Senior Civil Judge, Ranebennur are set aside in part.
iv. The suit of the plaintiff in O.S No.104/2011 on the file of Senior Civil Judge, Ranebennur is decreed in respect of property bearing survey No.183/2 measuring 4 acres 35
- 21 -
NC: 2023:KHC-D:12446 RFA No. 100126 of 2014 C/W RFA No. 100164 of 2016 guntas in Asundi Village, Taluk Ranebennur. Consequently, the decree for specific performance of contract dated 02.07.2010 is granted directing the plaintiff/appellant to pay Rs.10,40,000/- as an additional consideration amount within three months from today.
v. The plaintiff shall also pay the balance consideration amount of Rs.54,420/- within three months from today along with interest @6% p.a. from the date of the suit till the date of payment.
vi. On receipt of the aforementioned amount, the vendor/defendant in O.S.No.104/2011 shall execute the registered sale deed in favour of the plaintiff and transfer the possession of suit property in favour of the plaintiff.
- 22 -
NC: 2023:KHC-D:12446 RFA No. 100126 of 2014 C/W RFA No. 100164 of 2016 vii. The appellant is also entitled to the cost of the suit and the appeal and said cost shall be adjusted towards the amount payable to the defendant.
viii. The suit in O.S No.100/2011 on the file of Senior Civil Judge, Ranebennur is decreed in part. Decree for partition is granted in respect of Item No.1 property namely survey No.183/1 of Asundi Village, Taluk Ranebennur. Each of the plaintiffs is entitled to 1/5th share in the suit Item No.1 property. Suit in respect of Item No.2 property namely survey No.183/2 measuring 4 acre 35 guntas in Asundi Village, Taluk Ranebennur is dismissed.
Sd/-
JUDGE gab CT-PA LIST NO.: 1 SL NO.: 30 ...