Delhi District Court
Rising Properties Pvt. Ltd vs Mr. Chitru on 26 March, 2022
IN THE COURT OF SH. AJAY GARG, ADDITIONAL DISTRICT
JUDGE 01, PATIALA HOUSE COURTS, NEW DELHI
DISTRICT, NEW DELHI
CS No. 58718/16
Rising Properties Pvt. Ltd.
B 4/4, Safdarjung Enclave,
New Delhi 110029
Through its Director
Mrs. Anjali Sehgal.
......... Plaintiff
Versus
1. Mr. Chitru,
S/o. Sh. Ram Swarup
R/o. Village Kapashera
New Delhi110 037.
2. Mr. Mehar Singh,
S/o. Late (Sh.) Chitru
R/o. Village Kapashera
New Delhi110 037.
3. Smt. Sunita Sareen
W/o. Sh. Sudhir Sareen
R/o. B101, Greater KailashI,
New Delhi.
........ Defendants.
Suit presented On : 09.10.1991
Arguments Concluded On : 14.03.2022
Judgment Pronounced On : 26.03.2022
CS no. 58718/16
Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 1 of 30
JUDGMENT
1. This is a suit for Specific Performance filed by the plaintiff. Brief facts of the case are:
(a) The plaintiff is a private limited company duly incorporated under the provisions of the Companies Act, 1956. The plaintiff is engaged, inter alia, in the business of development and promotion of real estate.
(b) Mrs. Anjali Sehgal is one of the Directors of the plaintiff and as such is fully conversant with the facts and circumstances of the present case. She is competent to sign, verify, file and institute the present proceedings for and on behalf of the plaintiff and she has also been authorized for this purpose by virtue of a Board's Resolution passed on August 29, 1991.
(c) The plaintiff on July 4, 1991 had entered into an agreement with defendant no. 1 for the purchase of his agricultural land property admeasuring 8 Bighas and 3 Biswas (1.7 Acres approx). The same shall be hereinafter referred as the 'suit' property. Defendant no.1 had agreed to sell he suit property at the rate of Rs.16,00,000/ per acre.
(d) On the representation of the defendants to the CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 2 of 30 effect that defendant no.1 was declared Bhumidaars of the aforesaid agricultural land and as such is vested with the Bhumidaari rights in the said property in accordance with and under the provisions of the Delhi Land Reforms Act, 1954 and is in actual physical possession of the said piece of the land. The plaintiff agreed to purchase the land for a total consideration of Rs. 27,20,000/.
(f) The plaintiff at the instance of and in the presence of defendant no.1 paid an amount in the sum of Rs.
1,20,000/ towards earnest money and part sale consideration to defendant no. 2 for which amount defendant no. 2 signed and executed receipts in favour of the plaintiff. Upon payment of earnest money and part sale consideration, defendant no. 1 signed and executed an Agreement to sell which was also signed by Mrs. Anjali Sehgal for and on behalf of the plaintiff.
(g) Defendant No 1, in token of its having agreed to sell the suit property to the plaintiff and further having received through defendant no. 2 the aforesaid amount as earnest money, was required to sign and execute a number of other documents in favour of the plaintiff, interalia, a General Power of Attorney in favour of Mrs. Anjali Sehgal, the Director of the plaintiff. Since the CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 3 of 30 documents were not ready, it was decided and agreed between the parties that defendant no. 2 would collect the documents from the plaintiff later in the day and return the same after getting it signed by defendant No 1.
(h) Defendant no. 2 collected the documents including Agreement for Sale (already signed and executed between the plaintiff and defendant no. 1) from the plaintiff for signature thereon by defendant no. 1. Mr. Sanjay Lal, an employee of the plaintiff, accompanied defendant no. 2 to the residence of the defendants. On reaching his village at around 8 p.m., defendant no.2 represented that he would get the documents signed by defendant no.1 and asked Mr. Sanjay Lal to wait. Mr Sanjay Lal waited there for about three hours till around 11.00 P.M. but defendant no. 2 did not return from his house. Subsequently, also the said defendant did not bring back the documents with the result that the plaintiff was left with no document except the receipts signed and executed by defendant no. 2 at the instance and in the presence of defendant no.1 towards earnest money and part sale consideration. The plaintiff lodged a complaint with the local police. However, the police also could not help the plaintiff in retrieving the said documents.
CS no. 58718/16Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 4 of 30
(i) The plaintiff under the cover of its letter dated July 16, 1991, sent to the defendants through Registered A/D post and under the certificate of posting, while forwarding a copy of the complaint lodged with the police called upon the said defendants to fulfill and perform their part of the contract and take all necessary action / steps in respect thereof. However, no reply was received by the plaintiff in response to its above communication.
(j) The plaintiff during the same period, i.e. the 1 st week of July, 1991, had also negotiated for the purchase of the adjoining lands and an agreement for sale in respect thereto was also signed and executed on July 6, 1991 with Mr. Rai Singh. The plaintiff on July 4, 1991 also entered into another agreement for sale, with Mr. Mir Singh and others for the purchase of their 3/4th share of the adjoining piece of land ad measuring 8 Bighas and 4 Biswas. All the agreements were identical in so far as the terms and conditions are concerned.
(k) As per the terms of the agreement for sell executed between the parties hereto, the balance amount of consideration to the tune of Rs.26,00,000/ was payable before the SubRegistrar at the time of the registration of CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 5 of 30 the same.
(l) The defendants had agreed to handover and deliver the possession of the suit property to the plaintiff immediately upon the receipt of earnest money and part consideration. The plaintiff was at liberty to level, develop and improve the land property and raise construction thereon. However, it was agreed that in the event of failure on the part of the plaintiff to pay the balance amount of consideration within 30 days, the earnest money would be forfeited and the plaintiff would be liable to deliver back the possession without being entitled to reimbursement for any development costs.
(m) The plaintiff submits that the defendants now, overcome with greed to extract more money from the plaintiff are avoiding, signing of the documents, deeds and instruments so as to completely and effectually convey and transfer the title of the suit property in favour of the plaintiff. The plaintiff understands that the defendants have already started negotiating with other buyers and property dealers for sale of the suit property.
(n) The plaintiff has always been and is still ready and willing to perform its part of the agreement and to do all such acts and things necessary for having the suit CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 6 of 30 property transferred in its favour. The plaintiff always had the means to make the balance payment of consideration and can do so at any time as and when called upon.
(o) The defendants are under contractual obligation to complete all the formalities of execution and registration of sale deed for conveying complete title of the suit property in favour of the plaintiff and the defendants having failed to perform their part of the Agreement to execute the requisite deed and documents and to get the same registered in favour of the plaintiff.
2. Written statement filed by defendant no.2 (hereinafter referred as the defendant) wherein it is alleged that there was no concluded contract between the parties as alleged. It was made abundantly clear by the defendant to the plaintiff that the defendant could not execute any document relating to the suit property as he was not the bhoomidar thereof. Defendant no. 1 is the father of the defendant (defendant no. 2), and is the exclusive bhoomidar and defendant no.1 alone could deal in respect of the suit property. In such circumstances there could not be any concluded contract / agreement to sale between the parties in respect of the suit property. No agreement to sale as alleged ever came into existence between the plaintiff and the defendant.
CS no. 58718/16Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 7 of 30 The defendant has no authority nor had he represented to the plaintiff as such. It is further alleged that plaintiff has filed the suit with malafide intention to harass and pressurize the defendant especially defendant no. 1 who is blind to submit illegal demands of the plaintiff, to force him to handover the suit property to the plaintiff. It is further alleged that the alleged agreement to sale between plaintiff and the defendant (defendant no. 2) is void abinitio and the same has not been executed inaccordance with law. It is further alleged that the plaintiff had represented to the defendant that it had plans to purchase large chunks of land in the village and had been negotiating with other land holders of the village for the purchase of land and as such had expressed the desire to purchase the land of the father of the defendant.
2.1 It is further alleged that Sh. M.M. Sehgal is in the business of real estate, construction and development and purchased large chunks of land in his village. The plaintiff had expressed his desire to purchase the land of the village, the plaintiff had expressed his desire to purchase the land of the father of the defendant and in this connection defendant no. 2 had been invited to the office of the plaintiff where the defendant was told by Sh. MM Sehgal their intention/interest towards purchase of land of the defendant. 1 @ Rs 20 lacs per acre to defendant. The defen dant told Sh. Sehgal that he had no authority on behalf of his father (de fendant no.1) to deal in this property. However, Sh. Sehgal told the de CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 8 of 30 fendant to try and obtain approval of his father and to further finalize the sale price and other details after obtaining approval, permission, consent of his father. It is further submitted that the defendant was paid a sum of Rs.1,20,000/ in cash and was made to sign 04 blank papers which now appear to be the alleged receipts of earnest money towards alleged sale consideration. The above amount was paid to the defendant by Sh. MM Sehgal for getting the agreement for sale finalized between the plaintiff and defendant no. 1.
2.2 Defendant no. 1 was not even present at the time of above said negotiations / meetings. Moreover, defendant no. 1 is an illiterate, old, hard of hearing and blind man. After having received the money, defendant no.2 had agreed to persuade his father i.e. defendant on. 1 to agree to sell forthwith to the plaintiff his agricultural lands and on his ac ceptance of the offer to sell, defendant no. 2 was to communicate the same to plaintiff, a further sum of Rs. 80,000/ was promised by the plaintiff which was payable to the defendant at the time of completion of all the formalities and the execution of the sale deed. Rest of the contents of the plaint are denied.
3. Replication to the written statement is filed wherein it is al leged that there was no occasion for the defendant to have accepted the amount of Rs.1,20,000/ if the rate of the land had not been fixed. No reason or justification for having accepted the specific amount from the CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 9 of 30 plaintiff by the defendant, has been given by the defendant in his written statement. Rest of the contents of the written statement are denied and averments made in the plaint are reiterated and affirmed.
4. Separate written statement was filed by defendant no. 3 wherein it is submitted by defendant no. 3 that Mr. M.M. Sehgal husband of Mrs. Anjali Sehgal was the owner of Sehgal Paper Mills, a company which went into financial problems and was in BIFR. Mr. M.M. Sehgal himself got involved in the violation of Foreign Exchange and was con fined to jail for some time. Mrs. Anjali Sehgal and Sh. M.M. Sehgal were introduced to the defendant family by Mr. Pinaki Mishra, Advocate, a common friend who had purchased land in Village Kapashera at the in stance and through Mrs. Anjali Sehgal and Sh. M.M. Sehgal. The defen dant and her family had purchased lands in the said area at the instance of Mrs. Anjali Sehgal and Sh. M.M. Sehgal who had themselves identified the sellers. Further the plaintiff itself in the police complaint dated 16.01.1991 informed that defendant no. 2 had informed the plaintiffs that defendant no. 1 admittedly is the owner of the suit property, was a very old man and was totally deaf and blind and it was for this reason defen dant no. 2 signed the agreement on his behalf.
4.1 The receipts annexed to the plaint also disclose that the re ceipts has been signed by defendant no.2 and not by defendant no.1.
CS no. 58718/16Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 10 of 30 Therefore, the owner of the property has not signed any document to sell the properties belonging to him absolutely. Further more the owner of the property according to the admission of the plaintiff themselves was very old person and was deaf and blind and therefore, there could have been no communication of any nature between the plaintiff and the said defendant no.1 and therefore the question of defendant no.1 consenting to sell his land does not arise. It is further alleged that present suit filed by the plaintiff is a collusive suit between the plaintiff and defendant no. 2 to obtain a decision for a sinister purpose of practising fraud on the court and to defraud the defendant.
4.2 It is further alleged that suit property was sold to the answer ing defendant in November 1994 by registered sale deed by defendant no
2. As a matter of fact in 1993, Mr. M.M. Sehgal director of the plaintiff, approached the husband of the defendant alongwith the common friend Mr Pinaki Mishra, advocate, and persuaded the husband of defendant to buy land in Kapashera and build a farm house. Mr. M.M. Sehgal had ac quired land in the revenue estate of Kapashera and built a farm house. Mr. M.M. Sehgal also acquired land for Sh. Pinaki Mishra in the revenue estate of Kapashera. Mr. M.M. Sehgal was the owner of Sehgal Paper Mills which became a sick company. Mr. MM Sehgal and Mrs. Anjali Sehgal floated a number of private limited companies including Rising Properties Pvt Ltd, M/s Dunhill Construction (India) Pvt Ltd., Imperial CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 11 of 30 Properties Pvt. Ltd., Imperial Properties Pvt Ltd in which Mrs. Anjali Se hgal was Director.
4.3 Mrs. Anjali Sehgal and Sh. M.M. Sehgal identified approxi mately 9 acres of land in the said area which the defendant and her fam ily members purchased from sellers identified by Mrs. Anjali Sehgal and Sh. M.M. Sehgal. 22 sale deeds were executed in favour of defendant, her husband and son. In 1994 a loan of Rs.4,80,000/ was advanced to M.M. Sehgal for purchase of plot belonging to one Sh. Jaidev. Mrs. An jali Sehgal and her husband Mr. M.M. Sehgal had informed the defen dant that one of their companies Imperial Properties Pvt Ltd had already executed an Agreement to Sell dated 12.08.1993 pertaining to 18 bhigas 13 biswas falling in Khasra nos. 18/3 (416), 5 Min East (117), 6 (412), 7(48) and 15 Min East (30) situated in the revenue estate of village Ka pashera, Tehsil Mehrauli, New Delhi pursuant to which their company had taken over vacant physical possession of the land. They agreed to transfer the said land in favour of the defendants and agreement dated 04.03.1994 was executed between Sh. Jaidev, M/s Imperial Properties Pvt Ltd through its Director Smt. Anjali Sehgal and Sh. Sudhir Sareen and was witnessed by Mrs. Anjali Sehgal as Director acting on behalf of Imperial Properties Private Limited.
4.4 The defendant stated that the suit property has been in the CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 12 of 30 continued possession of the defendant since 1994 and the said suit prop erty is a part of the Sareen Farm on which a Farm House after due sanc tion from the Municipal Authorities has been build. Mrs. Anjali Sehgal the Director through whom the present suit has been filed resides next to the farm of the defendant and her husband owns a plot also adjoining the farm of the defendant. Mrs. Anjali Sehgal and husband M.M. Sehgal through whom the said lands were purchased were always in the knowl edge of the fact that the said suit property is in the possession of the de fendant since 1994. Defendant no. 2 at no stage brought this fact to the notice of the defendant.
5. Plaintiff filed replication to the written statement of defen dant no. 3 wherein the contents of the written statement are denied and averments made in the plaint are reiterated and affirmed.
6. Admission / denial of documents was not conducted on be half of defendant no.3. However, defendant no.2 admitted five docu ments of the plaintiff Ex. P1 to P5 wherein in Ex. P1 to P4 the signatures were admitted and the contents were denied and in Ex. P5 the signatures were denied :
(i) Receipt dated 04.07.1991 Ex. P1
(ii) Receipt dated 04.07.1991 Ex. P2
(iii) Receipt dated 04.07.1991 Ex. P3
(iv) Receipt dated 04.07.1991 Ex. P4
CS no. 58718/16
Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 13 of 30
(v) Acknowledgment card Ex. P5
7. My Learned Predecessor vide order dated 12.01.2005 framed following issues:
1. Whether the plaint has been instituted by a duly au thorized person? OPP
2. Where there was a concluded contract between the plaintiff and defendants 1 and 2 for sale of the suit land as alleged by the plaintiff in the suit? OPP
3. Whether the sum of Rs.1,20,000/ received by defen dant no. 2 was on account of getting the agreement to sell finalized between the plaintiff and defendant no. 1? OPD2
4. If issue no. 2 is decided in favour of the plaintiff, whether the plaintiff was ready and willing to com ply with its obligation under the contract? OPP
5. Whether sale of the suit land during the pendency of the suit to defendant no. 3 is hit by the doctrine of lis pendence? If so to what effect?
8. To prove its case plaintiff examined four witnesses. Ms. Anjali Sehgal stepped in witness box as PW1. She tendered her evidence by way of affidavit and relied upon documents :
• Copy of resolution Ex. PW1/1• Copies of Khasra Girdawari, Naksh and Fard received by plaintiff company from office of Patwari Ex. PW1/2 (colly) • Copy of ledger maintained by plaintiff company Ex.PW1/3
• Four receipts Ex. PW1/4 to Ex. PW1/7 • Copy of complaint dated 16.07.1991 Ex. PW1/8 CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 14 of 30 • Copy of notice dated 16.07.1991 Ex. PW1/9 • UPC and registered receipts Ex. PW1/10 • Agreement dated 06.07.1991 entered between plaintiff and Sh. Rai Singh Ex. PW1/11 • Copies of document showing that plaintiff company had sufficient balance to pay the balance consideration Ex. PW1/12.
9. Sh. Sanjay Lal stepped in witness box as PW2 and tendered his evidence by way of affidavit Ex. PW2/A. He in his evidence by way of affidavit deposed that he was employed as Assistant by plaintiff in 1991. He further deposed that plaintiff on 04.01.1991 entered into an agreement to sell with Sh. Chitru father of defendant no.1 to purchase his agricultural land approximately 1.7 acres. He deposed that Sh. Chitru agreed to sell the suit land to plaintiff @ Rs.16 lacs per acre and the total sale consideration was calculated to Rs.27,20,000/, out of which plaintiff company shall pay a sum of Rs.1,20,000/ towards part sale consideration and the remaining shall be paid at the time of registration and execution of sale deed. He further deposed that the sale deed was signed by Sh. Chitru by way of putting his thumb impression and the same was signed by Mrs. Anjali Sehgal for and on behalf of plaintiff and a sum of Rs.1,20,000/ in cash was handed over to Sh. Chitru and Sh. Mehar Singh and since it was early morning, receipt for the amount so paid was not ready as also revenue stamps were not available. When office of plaintiff opened, revenue stamp were put on the receipt and Sh. Mehar Singh CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 15 of 30 signed. It was agreed that the documents shall be taken by him along with Sh. Mehar Singh to their house at Village Kapashera in evening where Sh. Chitru shall sign the documents which were not signed by him in morning.
9.1 He further deposed that he alongwith file of documents in cluding Agreement to sell accompanied Mehar Singh and went to resi dence of Sh. Chitru. After reaching village at 08.00 p.m. Mhar Singh re quested that he would get the documents signed from Mr. Chitru and took the documents and thereafter did not return. Hence plaintiff was left with no other document except the four receipts. Thereafter a police com plaint was also lodged. Both Chitru and Mehar Singh were contacted prior to filing of suit to execute the sale deed against payment of balance consideration but both of them refused and asserted that the price of land has gone up and thus they were not interested to sell the land as per agreed rate.
10. PW3 Sh. Suraj Bhan, Patwari, Kapshera District South West brought current khatoni LR 20022003 of village Kapas Hera prepared in year 20022003 on the basis of old records. He deposed that New Kha toni is prepared after every four years and as per the khatoni Mr. Sudir Sareen is owning the land 18 (8, 13, 18 and 26) min and land bearing no. 18 (8, 13, 18 and 26) min has vested in Gram Sabha. The land bearing CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 16 of 30 no. 18 (14/1 and 14/2) has vested in Gram Sabha. The land bearing no. 18 (17/2 and 17/3) vested in Gram Sabha whereas land bearing no. 18 (17/1) is owned by Mr. Satish Kumar. He further deposed that the changes in earlier Khatonis are not reflected in current records.
11. PW4 Sh.Rajinder Ram, Patwari, Kapashera, District South West brought the summoned record Ex. PW4/1 i.e. Register Karyawahi (chakbandi) in relation to suit property, khatoni Paimaish for year 1997 1998, khatoni LR for 20022003. He deposed that as per records in year 199192 the suit property was in the name of Chitru and in year 199394 the property vested in the name of Mehar Singh on 30.08.1993. In year 199495, the suit property was sold by Mr. Mehar Singh in favour of Mrs. Sunita Sarin by way of two sale deeds, the mutation for which was carried on 30.01.1995 and land measuring 2 bighas 13 biswas out of the suit property was also sold to Mr. Sudhir Sarin.
11.1 He further deposed that the land which was in the name of Ms. Sunita Sarin i.e. 5 bighas and 11 biswas had been vested in Gram Sabha. The land in respect to the present suit was in the name of Mr. Sudhir Sarin had not been vested in Gram Sabha. The possession of land vested in Gram Sabha is still with Ms. Sunita Sarin.
Ld counsel for defendants cross examined all the plaintiff's witnesses except PW3.
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12. In defence defendant no. 2 Ms. Sunita Sareen was examined as DW1. She tendered her evidence by way of affidavit as Ex. DW1/1. She deposed as per the averments made by her in her written statement.
13. Sh. Sudhir Sareen stepped in witness box as DW2. He ten dered his evidence by way of affidavit Ex. DW2/A and relied upon docu ments i.e. agreement to sell as Ex. DW2/1. However, his evidence could not be concluded as he reportedly expired.
14. Sh. Ram Singh Yadav stepped in witness box as DW3. He tendered his evidence by way of affidavit Ex. DW3/A. He deposed that he very well know Mrs. Anjali Sehgal and Sh. M.M. Sehgal as they had purchased ½ share of property belonging to him. He further deposed that both Mrs. Anjali Sehgal and Sh. M.M. Sehgal were acquiring various lands in the Villages Kapashera for developing the same as farm houses and in connection thereto they introduced Mr. Sudhir Sareen to various Bhumidars in village Kapashera and also arranged the purchase of vari ous agricultural lands to Mr. Sudhir Sareen for developing his farm in Village Kapashera which includes suit property.
15. Sh. Pinaki Misra stepped in witness box as DW4. He ten dered his evidence by way of affidavit Ex. DW4/A. He deposed that he is CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 18 of 30 family friend of defendant no. 2 as he owns a farm at Kapashera. He fur ther deposed that he was also acquainted with Mrs. Anjali Sehgal and Sh. M.M. Sehgal who had floated number of private limited companies in cluding Rising Properties Pvt. Ltd, M/s Dunhill Construction (India) Pvt Ltd., Imperial Properties Pvt Ltd. etc. Both Mrs. Anjali Sehgal and Sh. M.M. Sehgal helped him to purchase some lands at Kapashera and he in troduced them one of his family friend Mr. Sudhir Sareen.
Ld counsel for plaintiff exhaustively cross examined all the defendant witnesses.
16. Arguments advanced on behalf of plaintiff and defendant no. 3 heard. Considered. I have gone through the entire records of the case including pleadings of the parties, evidence led by the parties and docu ments proved by the parties during trial.
17. Accordingly, my issuewise findings are :
ISSUE NO.1 Whether the plaint has been instituted by a duly authorized person? OPP The suit has been filed by plaintiff i.e. a private limited com pany through Ms. Anjali Sehgal, one of the Directors. Copy of her Board Resolution authorizing Ms. Aajali Sehgal to file the instant suit is already CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 19 of 30 on record. Even otherwise there is no evidence contrary / challenging the authority of Ms. Anjali Sehgal has been placed on record. In these cir cumstances this issue is decided in favour of the plaintiff.ISSUE NO. 2
Where there was a concluded contract between the plaintiff and defendants 1 and 2 for sale of the suit land as alleged by the plaintiff in the suit? OPP
18. The case of the plaintiff rests upon the premise of the plaintiff company having entered into an agreement with defendant no.1 for the purchase of his agricultural land property admeasuring 8 Bhigas and 3 Biswas (1.7 acres approx) situated in village Kapashera, New Delhi. The total consideration was for a sum of Rs.27,20,000/ out of which an amount of Rs.1,20,000/ was paid as earnest money and part sale consideration to defendant no.2 in presence of defendant no.1, who signed and executed receipts Ex. PW1/4 to Ex. PW1/7 and defendant no.1 signed and executed an Agreement to Sale.
19. However, since the inception of this matter, the alleged agreement to sell entered between the plaintiff and defendant no.1 has not seen the light of the day. The plaintiff claimed that since the documents were not ready for signing and execution, it was decided and agreed between the parties that defendant no. 2 would collect the CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 20 of 30 documents from plaintiff and return the same after getting it signed by defendant no. 1. On the said date, time and place Mr. Sanjay Lal, an employee of plaintiff company accompanied defendant no.2 to his village. Defendant no.2 left on the pretext that he would get the documents signed by defendant no.1, and employee of plaintiff was made to wait of three hours, defendant no.2 did not return from his house and plaintiff was left with no documents except the receipts Ex. PW1/4, Ex. PW1/5, Ex. PW1/6, Ex. PW1/7 signed and executed by defendant no. 2 in presence of defendant no.1 towards earnest money and part sale consideration. Left with no option, plaintiff lodged a complaint with local police and filed the present suit.
20. Admittedly, the alleged agreement to sell has not been proved on record. Further upon bare perusal of the police complaint filed by the plaintiff on 16.07.1991 vide Ex. PW1/8, the plaintiff claimed that defendant no.2 namely Mehar Singh, son of defendant no.1 entered into agreement to sell with the plaintiff on behalf of his father. The police complaint is the first narration of incident by the plaintiff which is totally silent about presence of defendant no.1, rather it gives an impression that defendant no.1 who is the owner of the suit property was not even in the picture and it is defendant no.2 who took the earnest money and documents for signing and execution. However, no authority in this regard executed by the owner of the land / suit property in favour of CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 21 of 30 defendant no.2 has been placed on record meaning thereby defendant no.2 never had any authority to execute agreement to sell or issue the receipts in consideration thereof on behalf of defendant no.1.
21. Further, the police complaint dated 16.07.1991 Ex. PW1/8 records that plaintiff was informed by defendant no.2 that defendant no.1 was deaf, blind and an aged person. Had there was a meeting / discussions between plaintiff and defendant no.1, plaintiff would be knowing very well about the physical appearance / condition of defendant no.1 and not relied upon the version of defendant no. 2 about his father's condition in the said police complaint. In these circumstances, since the alleged agreement to sell is neither placed on record nor the receipts issued by defendant no.2 amounts to any concluded contract between the plaintiff and defendant no.1 as there is no authority on record of defendant no.2 to enter into the agreement on behalf of defendant no.1, it cannot be called as a concluded contract.
22. Further, as per own averments of the plaintiff, the receipts has been signed by defendant no.2 and not by defendant no.1. Therefore, the owner of the property has not signed any document to sell the properties belonging to him absolutely. Further as per own admission of the plaintiff, defendant no.1 was very old person, deaf and blind and therefore, there could not have been communication of any nature CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 22 of 30 between the plaintiff and defendant no.1 and therefore the question of defendant no.1 consenting to sell his land does not arise. Further in police complaint Ex. PW1/8 plaintiff himself stated it was Mehar Singh who has received the earnest money and took the documents for signature of his father who was very old, totally deaf and blind. Meaning thereby there was no meeting of mind between the plaintiff and the owner of the suit property.
23. Further, there was no acceptance of any offer by defendant no.1 so as to construe of there having come into existence, a valid agreement of sale entered into by plaintiff on one part and defendant no.1 on the other part. Unaccepted offer of plaintiff company does not create any right or any obligation on part of defendant no.1 and/or guardian of defendant no. 1 to execute the sale deed. There was no concluded contract between plaintiff company on one part and defendant no.1 and/or guardian of defendant no.1 on the other part. In the absence of a concluded contract, the alleged agreement to sale dated is not enforceable, cannot be acted upon nor can it be made a promise/foundation by plaintiff company to seek specific performance of the same. Even reliance placed on a similar agreement to sell Ex. PW1/11 executed between plaintiff and the covillagers of defendant no.1 and 2 is of no use. In the case of Man Kaur (supra) it had been inter alia held that to succeed in a suit for specific performance, the CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 23 of 30 plaintiff has to prove :
(a) that a valid agreement of sale was entered by the defendant in his favour and the terms thereof;
(b) that the defendant committed breach of the contract; and
(c) that he was always ready and willing to perform his part of the obligations in terms of the contract.
24. A contract unlike a tort is not unilateral If there be no "meeting of minds" no contract may result. There should therefore be an offer by one party, express or implied, and acceptance of that offer by the other in the same sense in which it was made by the other. But, an agreement does not result from a mere state of mind : intent to accept an offer or even a mental resolve to accept an offer does not give rise to a contract. There must be intent to accept and some external manifestation of that intent by speech, writing or other act, and acceptance must be communicated to the offerer, unless he has waived such intimation. The offerer cannot impose upon the offeree an obligation accept, nor proclaim that silence of the offeree shall be deemed consent. A contract being the result of an offer made by one party and acceptance of that very offer by the other, acceptance of the offer and intimation of acceptance by some external manifestation which the law regards as sufficient is necessary. Reliance placed upon Bhagwandas Goverdhandas Kedia Vs. Girdharilal Parshottamdas & Co. & Ors., (1966) 1 SCR 656. The principle afore elicited was again followed by the Apex Court in the case CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 24 of 30 of Uttar Pradesh Avas Evam Vikas Parishad & Ors. Vs. Om Prakash Sharma, (2013) 5 SCC 182, whereby, it was interalia held that the unaccepted offer of the plaintiff does not create any right or any obligation on the part of the defendant to execute the lease deed. Mere making of an offer does not form part of the cause of action for even claiming damages for breach of contract.
25. Section 4 of The Contract Act, 1872 embodies interalia that the communication of an acceptance is complete as against the proposer, when it is put in a course of transmission to him so as to be out of the power of the acceptor and; as against the acceptor, when it comes to the knowledge of the proposer.
26. In the case of Visweswardas Gokuldas Vs. B.K. Narayan Singh & Anr., 1969 (1) SCC 547, it had been interalia held that even a plaint in a suit for specific performance should allege a concluded contract and that there being no acceptance made or communicated before the offer was withdrawn, there could not be a concluded contract.
27. Section 7 of The Contract Act provides that in order to convert a proposal into a promise the acceptance must be absolute and unqualified and be in express and reasonable manner, unless the proposal CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 25 of 30 prescribes the manner in which it is to be accepted. Section 9 of The Contract Act lays down that in so far as the proposal or acceptance of any promise is made in words, the promise is said to be express and when such proposal or acceptance is made otherwise than in words, the promise is said to be implied. Further, in the case titled Mirahul Enterprises Vs. Vijaya Sririvastava AIR 2003 Delhi 15 decided on 10.05.2002 relied by the defendant, it was held as under :
24. Before we proceed to analyses the evidence in this case and to appreciate the submissions made at the bar, it will be put necessary to take into consideration the provisions of Specific Relief Act and the requirements of law before a decree for specific performance be granted. Grant of decree for specific performance under Section 20 of the Specific Relief Act, 1963 rest in the discretion of the Court and cannot be claimed as of right. Parties seeking performance of contract must satisfy all the requirements necessary for seeking relief in equity. In exercising discretion, Court is obliged to take into consideration circumstances of the case, conduct of the parties and the respective interests under the contract. at the same time, it should not be lost sight of that the discretion has to be exercised by the Court not arbitrarily but based on sound judicial principles. The first fundamental, which must be proved beyond all reasonable doubts is the existence of a valid and enforceable contract. Where a valid and enforceable contract has not been made, Court will not make a contract for the parties. Specific performance will not be ordered it the contract itself suffers from some defect, makes the contract invalid or unenforceable. Reference at this stage be made to a decision of the Supreme Court in Mayawanti v. Kaushalya Devi (1990) 3 SCC 1.
25. Section 10 of the Contract Act defines as to what agreements are contracts. All agreements are contracts, it they are made by the free consent of parties competent to contract, for a lawful consideration and with a lawful object, and are not hereby expressly declared to be void. A true contract thus requires the agreement of the parties CS no. 58718/16 Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 26 of 30 freely made with full knowledge and without any feeling of restraint.
Parties must be adidem on the essential terms of the contract In case, it is an agreement to sell of immovable property, the law requires that it must with certainty identify the property agreed to be sold and the price fixed as consideration paid or agreed to paid. Price has not been defined in Transfer of Property Act but that expression has to be understood in the same sense as is understood in the Sales of Goods Act. Every sale implies a contract of sale and like any other contract, the contract for sale of immovable property must be based on mutuality.
26. Where in a suit for specific performance of contract, the contract on which relief is based is found to be not a concluded contract, relief cannot be given on the basis of another contract alleged by the plaintiff to be a concluded contract, for which we make reference to the decision of the Supreme Court in Ganesh Shet. vs. Dr. C.S.G.K Setty AIR 1998 SC 2216. The facts in the said case were that the property was owned jointly by three brothers. The purchaser clearly stated that at their meeting with one of the brothers, he told that he is yet to consult his two brothers about sale consideration. Tenor of several letters between the parties showed that sale consideration was not finalised in their meeting. It was held that there was no concluded contract between the parties on which decree for specific performance could not be passed. In the said case, Supreme Court held that in a suit for specific performance the evidence and proof of agreement must be absolutely clear and certain. Reference was made in the said decision to Pomeroy on "specific Performance of Contracts" (3rd Edn) (para 159) wherein it is stated clearly that a "greater amount or degree of certainty is required in the terms of an agreement, which is to be specifically executed in equity, than is necessary in a contract which is to be the basis of an action at law for damages. An action at law is founded upon the mere nonperformance by the defendant, and this negative conclusion can often be established without determining all the terms of the agreement with exactness. The suit in equity is wholly an affirmative proceeding. The mere fact of nonperformance is not enough; its object is to procure a performance by the defendant and this demand a clear, definite and precise understanding of all the terms; they must be exactly ascertained before their performance can be enforced.
CS no. 58718/16Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 27 of 30
28. In view of the above discussions, it can be safely presumed by preponderance of probabilities that there was no concluded contract between the plaintiff and defendant no.1 i.e. the erstwhile owner of the suit property for sale of the suit land as alleged by the plaintiff. Hence, this issue is decided against the plaintiff.
ISSUE NO. 3Whether the sum of Rs.1,20,000/ received by defendant no.2 was on account of getting the agreement to sell finalized between the plaintiff and defendant no. 1? OPD 2
29. Onus to prove this issue was upon defendant no.2. However, since defendant no.2 has been proceeded exparte and did not lead any evidence in support of this contention, this issue is decided against defendant no.2.
ISSUE NO. 4If issue no. 2 is decided in favour of the plaintiff, whether the plaintiff was ready and willing to comply with its obligation under the contract? OPP
30. Since issue no.2 is decided against the plaintiff, no findings are required to be given on this issue.
CS no. 58718/16Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 28 of 30 ISSUE NO. 5 Whether sale of suit land during the pendency of the suit to defendant no.3 is hit by the doctrine of lis pendence? If so to what effect?
31. In view of findings of issue no. 2 above, the sale of suit property in favour of defendant no.3 is not hit be rule of lis pendence, since no concluded contract ever took place inter se between plaintiff on one part and defendant no. 1 on other part.
RELIEF:
32. Admittedly, the defendant no. 2 had received a sum of Rs.1,20,000/ against receipts Ex. PW1/4 to Ex. PW1/7 from plaintiff company. No evidence has been led by defendants to show as to how the aforesaid amount of Rs. 1,20,000/ can be forfeited because in the absence of loss being caused the said amount paid cannot be forfeited as per the ratio of the Constitution Bench judgment of Supreme Court in the case of Fateh Chand Vs. Bal Kishan Das, AIR 1963 SC 1405. Therefore, the plaintiff company would be entitled to a money decree for a sum of Rs. 1,20,000/ with pendentelite and future interest @ 8% per annum from defendant no.2 namely Mehar Singh.
CS no. 58718/16Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 29 of 30
33. In view of the aforesaid discussion, the suit of the plaintiff for specific performance stands dismissed. A money decree is passed in favour of plaintiff company and against the defendant no.2 for a sum of Rs. 1,20,000/ with pendentelite and future interest @ 8% per annum. Parties are left to bear their own costs. Decree sheet be prepared accordingly.
File be consigned to record room.
Pronounced in the open Court (AJAY GARG)
on 26.03.2022. Additional District Judge01
Patiala House Courts/New Delhi
CS no. 58718/16
Rising Properties Pvt. Ltd. Vs. Sh. Chitru & ors Page no. 30 of 30