Karnataka High Court
Shri. Santosh S/O Tulajappa Mali vs Shri. Laxman S/O Ramappa Kolar on 10 August, 2022
Author: Ravi V.Hosmani
Bench: Ravi V.Hosmani
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RSA No. 100033 of 2021
IN THE HIGH COURT OF KARNATAKA,
DHARWAD BENCH
DATED THIS THE 10TH DAY OF AUGUST, 2022
BEFORE
THE HON'BLE MR JUSTICE RAVI V.HOSMANI
REGULAR SECOND APPEAL NO. 100033 OF 2021 (SP)
BETWEEN:
SHRI SANTOSH S/O TULAJAPPA MALI,
AGE 33 YEARS, OCC AGRICULTURE,
R/O JAMKHANDI, TQ.- JAMKHANDI,
DIST BAGALKOT-587301
...APPELLANT
(BY SRI SHIVRAJ S. BALLOLI, ADVOCATE)
AND:
1. SHRI LAXMAN S/O RAMAPPA KOLAR
AGE MAJOR, OCC-AGRICULTURIST,
R/O GOTHE VILLAGE, TQ.- JAMKHANDI
DIST BAGAKOT-587301.
2. MEHABOOBSAB S/O. KAZISAB JUNEDHAR,
AGE 45 YEARS, OCC-AGRICULTURE,
R/O ALGUR, TQ.- JAMKHANDI,
DIST BAGALKOT-587301.
...RESPONDENTS
(BY SRI RAJASHEKHAR BURJI, ADV. FOR RESPONDENT NO.1)
(BY SRI HARISH S.MAIGUR, ADV. FOR RESPONDENT NO.2)
THIS R.S.A. IS FILED U/SEC.100 OF C.P.C., PRAYING TO
ALLOW THE APPEAL AND MODIFY THE JUDGMENT AND DECREE
DATED 03.11.2020 PASSED IN R.A.NO.20/2017 ON THE FILE OF
THE PRINCIPAL SENIOR CIVIL JUDGE, ATHANI THEREBY WHICH
THE I APPELLATE COURT HAS ALLOWED THE APPEAL ONLY IN
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RSA No. 100033 of 2021
PART AND BY PARTLY MODIFYING THE JUDGMENT AND DECREE
DATED 16.03.2017 PASSED IN O.S.NO.42/2011 ON THE FILE OF
THE PRINCIPAL CIVIL JUDGE AND JUDICIAL MAGISTRATE FIRST
CLASS, JAMKHANDI, HOLDING CONCURRENT CHARGE OF
ADDITIONAL CIVIL JUDGE AND JMFC, JAMKHANDI AND THIS
COURT MAY BE PLEASED TO GRANT SPECIFIC RELIEF AS
SOUGHT BY THE APPELLANT/PLAINTIFF TO MEET THE ENDS OF
JUSTICE AND EQUITY.
THIS APPEAL COMING ON FOR ADMISSION THIS DAY, THE
COURT DELIVERED THE FOLLOWING:
JUDGMENT
Challenging the judgment and decree dated 03.11.2020 passed by Additional Senior Civil Judge, Jamakhandi in R.A.no.20/2017 and the judgment and decree dated 16.03.2017 passed by Principal Civil Judge and JMFC, Jamakhandi in O.S.no.42/2011, this appeal is filed by the plaintiff.
2. Appellant herein was plaintiff, while respondents herein were defendants no.1 and 2 in original suit. For sake of convenience, they shall hereinafter be referred to by their ranks in original suit.
3. O.S.no.42/2011 was filed stating that defendant no.1 was owner of land bearing Sy.no.68/3B measuring 04 -3- RSA No. 100033 of 2021 acres, 19 guntas situated at Gothe village, Jamakhandi Taluka. That during month of November-2007, defendant no.1 offered to sell same to plaintiff for total sale consideration of Rs.1,22,000/-. An agreement of sale was entered into on 05.11.2007, after receiving advance payment of Rs.1,15,000/-.
4. As per terms of agreement of sale, defendant no.1 was required to execute sale deed in favour of plaintiff by receiving balance amount of Rs.7,000/-. As per agreement, sale deed was required to be executed on or before 05.11.2009. Thereafter though plaintiff called upon defendant no.1 to execute sale deed, defendant No.1 kept on postponing on some pretext or other, thereby, constraining plaintiff to get issued legal notice on 25.06.2010. Despite receipt of notice, defendant no.1 did not reply. In plaint, it was further stated that after issuance of legal notice defendant no.1 alienated suit property in favour of defendant no.2 on 02.07.2010. Thereby constraining plaintiff to file suit.
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5. Upon service of summons, defendant no.1 filed written statement stating that agreement of sale was executed as a security for a debt obtained by defendant from plaintiff and previously plaintiff got executed another document on 27.12.2005 as agreement of sale for Rs.1,20,000/- showing Rs.60,000/- as earnest money paid and Rs.60,000/- as balance amount to be paid on or before 30.04.2007. There was denial of intention to sell suit property. It was specifically asserted that defendant had repaid amount received from plaintiff except balance of Rs.7,000/-. Thereafter defendant no.1 executed registered sale deed in favour of defendant no.2 lawfully and therefore defendant no.1 was due only a sum of Rs.7,000/- to the plaintiff.
6. Defendant no.2 filed written statement stating that defendant no.1 was in need of money for legal necessity in month of July 2010. Therefore, defendant no.1 put up suit property for sale and that defendant no.2 purchased it for valuable sale consideration of -5- RSA No. 100033 of 2021 Rs.2,06,000/-. Sale Deed was registered on 02.07.2010 by receiving entire sale consideration and therefore defendant no.2 claimed to be a bonafide purchaser for value.
7. Based on pleadings, trial Court framed following issues:
1. Whether plaintiff proves that defendant has executed the sale agreement dated 05.11.2007 agreeing to sell the suit property for consideration of Rs.1,22,000?
2. Whether plaintiff proves that he has paid Rs.1,15,000/- as earnest money towards part performance of contract?
3. Whether plaintiff proves that defendant no.2 has purchased the suit property from defendant no.1 with the knowledge of alleged sale agreement?
4. Whether plaintiff proves that he has always ready and willing to perform his part of contract?-6- RSA No. 100033 of 2021
5. Whether defendant no.1 proves that the sale agreement was executed in favour of plaintiff as a security of loan transaction?
6. Whether defendant no.2 proves that he purchased the suit property from defendant no.1 for valid consideration without notice of the sale agreement?
7. Whether plaintiff is entitled for relief specific performance of contract?
8. Whether plaintiff is entitled for alternative relief of refund of earnest money?
9. What order or Decree?
8. Thereafter plaintiff examined three witnesses as P.W.1 to 3 and got marked Ex.P.1 to 9. On behalf of defendants, defendant no.1 was examined as D.W.1. Ex.D.1 to 43 were marked.
9. On consideration, trial Court answered issue nos.1 to 4 and 7 in negative and issue nos.5 and 6 in affirmative. Issue no.8 partly in affirmative and issue no.9 by decreeing suit in part and directing the defendants to -7- RSA No. 100033 of 2021 repay the sum of Rs.7,000/- with interest at 6% per annum from the date of suit to the plaintiff.
10. Aggrieved thereby, plaintiff filed R.A.no.20/2017 on several grounds. It was contended that the Judgment and Decree passed by trial Court was contrary to law, facts and evidence on record and was capricious and perverse. Trial Court failed to frame proper issues and in view of evidence led by plaintiff, trial Court ought to have answered issues no.1 and 2 in favour of plaintiff. Conclusion of trial Court that agreement of sale required registration was erroneous. As also conclusion that transaction between parties was a loan transaction. Trial Court also failed to consider legal notice issued by plaintiff to defendant no.1 while considering readiness and willingness of plaintiff.
11. Based on contentions urged, first appellate Court framed following points for consideration :
1. Whether trial Court was justified in holding that agreement of sale dated 05.11.2007 is -8- RSA No. 100033 of 2021 not to sell the land but it is executed as a security for debt?
2. Whether trial Court was justified in holding that defendant no.1 has repaid the amount and he is only liable to repay Rs.7,000/-?
3. Whether trial Court was justified in holding that defendant no.2 is a bonafide purchaser without knowledge of earlier agreement of sale?
4. Whether trial Court was justified in refusing the relief of specific performance of contract?
5. Whether impugned judgment and decree of trial Court warranting interference by this Court?
6. What order or decree?
12. After answering point nos.1, 3 to 5 in affirmative, point no.2 in negative, it answered point no.6 by allowing appeal in part and modifying judgment and decree holding plaintiff entitled for refund of amount of Rs.1,15,000/- with interest at 10% per annum from 05.11.2007 to be paid by -9- RSA No. 100033 of 2021 defendant no.1 within two months. Against said judgment, plaintiff is in appeal.
13. Sri. Shivraj S. Balloli, learned counsel appearing for appellant submits that when first appellate Court came to conclusion that plaintiff had proved agreement of sale, there was no justification for it to deny specific performance. He submitted that balance sale consideration was only Rs.7,000/-. Therefore, first appellate court erred in holding that plaintiff was not ready and not willing to perform his part of contract. Learned counsel submitted that following substantial questions of law would arise for consideration :
1. Whether trial Court and first Appellate Court were justified in holding that agreement in question is an agreement executed towards the security of the alleged loan borrowed by defendant no.1 from plaintiff?
2. Whether Courts below have drawn wrong inferences by completely ignoring material evidence on record and proved facts?
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RSA No. 100033 of 2021
14. On other hand, Sri. Rajashekhar Burji, learned counsel appearing for respondent no.1 and Sri. Harish S. Maigur, appearing for respondent no.2 opposed appeal. They submitted that there was no intention of defendant no.1 to sell suit property in favour of plaintiff and agreement of sale was executed only as security for loan transaction between plaintiff and defendant no.1. Trial Court after appreciation of evidence, it upheld contention of defendants and directed repayment of Rs.7,000/- to plaintiff. They submitted that date of agreement of sale was 05.11.2007. As per conditions of agreement of sale, sale deed was to be got registered on or before 05.11.2009. However, as per averments in plaint, legal notice-Ex.P.3 was got issued on 25.06.2010, after expiry of period stipulated in agreement of sale. Thereafter, suit was filed on 05.04.2011. Therefore, both Courts were justified in holding that plaintiff failed to prove readiness and willingness. They also submitted that there were no specific pleadings about readiness and willingness in plaint. It was further submitted
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RSA No. 100033 of 2021 that though suit was filed by Santosh Tulajappa Mali, he did not enter witness box to depose about readiness and willingness. On other hand, his father deposed as his Power of Attorney Holder. Relying decision passed in Pushpalatha and Another vs. D.R.Sadananda Murthy, reported in 2020(1) KCCR 735, it was submitted that this Court after considering ratio laid down by Hon'ble Apex Court in the case of Man Kaur vs. Hartar Singh Sangh, reported in AIR 2010 SCW 6198 and Janaki Vashdeo Bhojwani vs. Indusind Bank Ltd., reported in 2005(2) SCC 217 held that a Power of Attorney Holder can depose about acts done by him as agent of principal and cannot depose about acts of principal not done by him as he would have no personal knowledge about same.
15. From above submissions, it is not in dispute that defendant no.1 was original owner of suit property. Even execution of agreement of sale dated 05.11.2007 is also not in dispute. While plaintiff contends that with intention of selling suit land, defendant executed agreement of sale in
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RSA No. 100033 of 2021 his favour after receiving Rs.1,15,000/- out of sale consideration of Rs.1,22,000/-, but failed to perform his part of contract, it is case of defendant no.1 that there was no intention of sale between parties. There was a loan transaction between defendant no.1 and plaintiff, wherein, defendant had repaid loan amount except Rs.7,000/- which was due and that agreement of sale was executed as a security for said loan transaction. It is also their case that plaintiff failed to establish readiness and willingness.
16. While passing impugned Judgment and Decree, trial Court referred to deposition of D.W.1, wherein, he stated that he had paid sum of Rs.1,08,000/- to plaintiff, after selling suit property in favour of defendant no.2. It also referred to deposition of P.W.1, wherein, he stated that he was father of plaintiff and working as Agricultural Assistant in Agriculture Department and he had received some amount from K.G.I.D. and pooling money available with him, he had paid earnest money of Rs.1,15,000/- to defendant no.1.
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RSA No. 100033 of 2021
17. It proceeded to hold that since agreement of sale was an un-registered document and defendant established that amount received by him was repaid to plaintiff except balance of Rs.7,000/- it proceeded to answer issue nos.1 and 2 in negative. On said finding, it answered other issues also against plaintiff. But, taking note of admission by defendants about balance amount of Rs.7,000/- to be paid, it decreed suit partially for refund of Rs.7,000/- with interest at 6% per annum.
18. The appellate court however referred to admission of defendants about execution of Ex.P.7 agreement of sale and as it did not refer to any loan transaction, it answered point no.1 in affirmative holding that plaintiff had established execution of agreement of sale. After referring to evidence on record, it held that the evidence led by defendant no.1 was insufficient to inspire confidence about his claim of having repaid loan amount leaking balance of only Rs.7,000/-. On said finding, it modified judgment and decree passed by trial Court and
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RSA No. 100033 of 2021 held plaintiff entitled for refund of Rs.1,15,000/- along with interest at 10% per annum.
19. In a suit for specific performance, where time is stipulated, it is essence of contract. Admittedly, legal notice issued by plaintiff is after date fixed for execution of sale deed. Though, first appellate Court held agreement of sale as having been duly established, insofar as readiness and willingness, factors to be taken into account are agreement of sale, time fixed for execution of sale deed and conduct of plaintiff. Hon'ble Supreme Court in a recent decision in case U.N.Krishnamurthy (Since deceased) Other LRs. vs. A.M.Krishnamurthy, in Civil Appeal No.4703/2022 disposed of on 12.07.2022 has enumerated contours of law regarding readiness and willingness. Admittedly, when plaintiff issued legal notice after expiry of date fixed for execution of sale deed, it cannot be said that he was ready and willing to perform his part of contract. In any case, first appellate Court decreed refund of advance amount paid. The plaintiff has failed to make out any case for grant of
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RSA No. 100033 of 2021 discretionary relief of specific performance. I do not find any justification for interfering with the judgment and decree passed by first appellate Court. No substantial question of law arises for consideration and there is no merit in appeal. In the result, appeal is dismissed at stage of admission itself.
Sd/-
JUDGE CKK