Himachal Pradesh High Court
Vinay Bodh vs Smt. Dolekar & Othersr on 16 May, 2015
Author: Tarlok Singh Chauhan
Bench: Tarlok Singh Chauhan
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA .
Civil Suit No. 56 of 2006.
Reserved on: 16.4.2015.
Date of decision: May 16,2015.
Vinay Bodh. ...Plaintiff
Versus
Smt. Dolekar & othersr ...Defendants
Coram
The Hon'ble Mr. Justice Tarlok Singh Chauhan, Judge.
Whether approved for reporting?1Yes.
For the Plaintiff: Mr.Sunil Mohan Goel, Advocate.
For the Defendants: Mr.Atul Jhingan, Advocate, for defendant No. 1.
Mr. K.D. Sood, Senior Advocate with Ms. Ranjana Chauhan, Advocate, for defendants No.2 and 3.
Mr. Ramakant Sharma, Advocate, for defendant No. 4.
Tarlok Singh Chauhan, Judge.
The plaintiff has filed the present suit claiming therein the following reliefs:-
"(i) Pass a decree for specific performance of the contract dated 27.9.2005, directing the defendant No. 1, to execute a legal valid and proper sale deed in favour of the plaintiff and to get the same registered in the office of Sub Registrar Manali in respect of land comprised in Khatauni No. 308(old) 505/660 (new) Khasra No. 686 measuring 0-07-23 hectares alongwith two houses as detailed in agreement to sell in village Shuru, Phati Prini, Kothi Jagatsukh Tehsil Manali District Kullu.
Whether the reporters of the local papers may be allowed to see the Judgment? Yes.
::: Downloaded on - 15/04/2017 18:11:45 :::HCHP 2(ii) To cancel sale deed executed and registered on 25.11.2005 by defendant No. 1 in favour of defendants No. 2 & 3 and .
declaring the same null and void and not binding upon the rights of parties.
(iii) To cancel subsequent sale deed executed and registered on 29.9.2006, by defendant No. 2 & 3 in favour of defendant No. 4 and declare the same null and void and not binding upon the rights of the plaintiff.
(iv) To grant damages to the tune of Rs.20,00,000/- to the plaintiff against the defendants jointly and severally as also in the alternative the refund of entire sale consideration i.e. Rs.15,00,000/- with interest.
(v) To grant injunction in favour of the plaintiff and against the defendants restraining them from transferring, alienating, mortgage the demised property to make any addition or alterations or change the nature of the same or lease out the same to any third party or encumber the said demised property in any manner till the final disposal of the suit.
(vi) Any other equitable relief in addition to relief of specific performance which this Hon'ble Court deems fit just and equitable in the facts and circumstances of the case in the interest of justice"
2. The facts as pleaded in the plaint are that the plaintiff is permanent resident of village Bhuntar, Phati & Kothi Khokan Tehsil and District Kullu and is a bonafide Himachali and is an agriculturist within the meaning of H.P. Tenancy & Land Reforms Act, 1972. Defendant No. 1 is resident of village Shuru, Phati Prini, Kothi Jagatsukh, Tehsil Manali District Kullu and was well known to the plaintiff. She wanted to sell her land and house standing thereupon and after negotiations, defendant No. 1 agreed to sell the two houses along with land comprised in Khewat No. 308(old) 505/660 (new), Khasra No. 3201/2665 (old) now Khasra No.686 (new), measuring 0-07-23 hectares. An agreement to sell was entered into by the parties on 27.9.2005, on ::: Downloaded on - 15/04/2017 18:11:46 :::HCHP 3 which date the plaintiff paid full sale consideration of Rs.15,00,000/-. In terms of this agreement time for defendant .
No. 1 to remove her personal belongings was given and the sale deed was agreed to be executed before or latest by 31st March, 2006. Defendant No.1 encashed the cheque on 1.10.2005, but thereafter when the plaintiff contacted her and requested her to execute the sale deed in his favour and deliver physical possession of the demised premises, as agreed to be sold, defendant No.1 kept evading the matter on one pretext or the other and stated that she would get the sale deed executed well before 31st March, 2006. Even on 31st March, 2006, defendant No. 1 failed to appear in the office of Sub Registrar, though the plaintiff reached there at 10:00 A.M. and remained there till 4.30 P.M. An affidavit evidencing the presence of the plaintiff was got attested on 31.3.2006 before the Executive Magistrate, Manali.
The plaintiff thereafter contacted defendant No. 1 who still assured him that she would get the sale deed executed and it was only on account of certain unavoidable circumstances that she was compelled to remain at Chandigarh. When defendant No. 1 despite a passage of time failed to execute the sale deed, the plaintiff got a legal notice dated 31.8.2006 served upon defendant No.1, both on her residential address in Tehsil Manali as also the address at Chandigarh. But these notices were received back undelivered. It is then averred that the plaintiff came to know that defendant No.1 had got executed a sale deed and got the same registered in favour of defendants No. 2 and 3 on 25.11.2005 of the same property in the office of Sub Registrar, ::: Downloaded on - 15/04/2017 18:11:46 :::HCHP 4 Manali for a sale consideration of Rs.20,00,000/-. This sale deed was stated to be illegal, void and not binding upon the rights of .
the plaintiff. It is thereafter averred that defendants No. 2 and 3 after realizing that the sale deed executed in their favour by defendant No. 1 was likely to be cancelled being illegal and void, sold the suit land to defendant No. 4 vide sale deed dated 29.9.2006 for a sale consideration of Rs.20,00,000/-. The plaintiff states that he was ready and willing to perform his part of contract and is still ready and willing to perform his part of contract and even has sufficient funds with him for purchase of stamp papers. It is lastly claimed that the suit is within time, since the cause of action has arisen on 27.9.2005. It is in this background that the present suit has been filed claiming therein the reliefs as mentioned herein above.
3. Defendant No.1 resisted the suit of the plaintiff by filing written statement, wherein preliminary objections regarding the form of suit as also the plaintiff being suppressio veri and suggestio falsi were raised. On merits, specific defence of defendant No. 1 is that she had sought a friendly loan from the plaintiff and as per general practice had executed a sale agreement with him. The sale agreement was not to be acted upon and was actually executed towards security for securing the loan amount. It was implied that the suit land would remain in possession and ownership of defendant No. 1 and as and when the loan amount would be retuned, the sale agreement would be destroyed and not acted upon. Defendant No. 1 did not deny the receipt of notice, but averred that since she was unable to pay the ::: Downloaded on - 15/04/2017 18:11:46 :::HCHP 5 plaintiff friendly loan, she was constrained to sell the suit land in favour of defendants No. 2 and 3 for a sale consideration of .
Rs.20,00,000/- vide sale deed dated 25.11.2005. Defendants No. 2 and 3 were made fully aware of the fact that the land was being sold, so that defendant No. 1 could repay back the money to the plaintiff. Defendants No. 2 and 3 agreed to purchase the land and undertook to indemnify defendant No. 1 from any claims or litigations, if initiated by the plaintiff with respect to the suit property.
4. Defendants No.2 and 3 have filed separate written statement and have claimed themselves to be bonafide purchasers for consideration, having no knowledge regarding any agreement having been entered into between the plaintiff and defendant No.1. It is claimed that the property in dispute had been agreed to be sold by defendant No. 1 in pursuance to the agreement to sell dated 25.5.2005 for a sale consideration of Rs.20,00,000/-, which sale deed was executed and registered in their favour on 25.11.2005. The suit property was purchased jointly by defendants, but owing to differences between them, they chose to dispose of the property in favour of defendant No. 4 for a sale consideration of Rs.20,00,000/- on 29.9.2006. Neither defendants No. 2 and 3 nor defendant No. 4 was ever aware of any agreement having been entered into between the plaintiff and defendant No. 1 and therefore, claimed that they were bonafide purchasers for consideration.
5. Defendant No. 4 filed separate written statement, wherein she claimed to be a bonafide purchaser for consideration, ::: Downloaded on - 15/04/2017 18:11:46 :::HCHP 6 as she had no knowledge of any agreement having been entered into between the plaintiff and defendant No. 1.
.
6. On 28.3.2008, this Court framed the following issues:-
"(1) Whether the plaintiff is entitled to a decree for specific performance of the agreement to sell dated 27.9.2005 executed by defendant No. 1 qua suit property as described in the plaint?
...OPP.
(2) Whether the plaintiff is entitled to the other reliefs, as prayed for, namely, damages to the extent of Rs.20 lacs and refund of the entire sale consideration of Rs.15 lacs or any other amount, as prayed for? ...OPP.
(3) Whether the plaintiff is entitled for a decree declaring the sale deed executed and registered on 25.11.2005 by defendant No. 1 in favour of defendants No. 2 and 3 to be null and void and not binding on the interest of plaintiff?
...Onus of proof on plaintiff, defendants 1, 2 and 3 (4) Whether the plaintiff is entitled to a decree declaring the sale deed registered on 29.9.2006 by defendants No. 2 and 3 in favour of defendant No. 4 to be null and void and inoperative on the rights of the plaintiff?
...Onus of proof on the parties.
(5) Whether the plaintiff is entitled to a decree for permanent prohibitory injunction restraining the defendants from transferring, alienating, encumbering or mortgaging the suit property?
....OPP.
(6) Whether the plaint as filed is neither competent not maintainable, as alleged?
...OPD-1.
(7) Whether the plaintiff is guilty of suppressio veri and suggestio falsi, as alleged?
...OPD-1.
(Both issues objected to by learned counsel appearing for the plaintiff on the ground that complete particulars as required by Order 6 Rule 2 of the Code of Civil Procedure have not been given).
(8) Whether the amount of Rs.15 lacs was paid as sale consideration by the plaintiff to the defendant or was in the nature of a land, as alleged?
...OPD-1.
(9) Whether defendants No. 2 and 3 had knowledge of the fact that a valid agreement to sell to the suit property had been executed between the plaintiff and defendant No. 1 such knowledge having been imparted by defendant No. 1 as alleged?
....OPD-1.
(10) Whether defendants No. 2 and 3 had agreed with defendant No. 1 that they would be responsible for any ::: Downloaded on - 15/04/2017 18:11:46 :::HCHP 7 litigation/suit which may be brought against defendant No. 1 and would defend the same at very risk, costs and consequences?
...OPD-1.
.
(11) Whether defendants No. 2 and 3 are bonafide purchaser of the suit property for a consideration of Rs.20 lacs, as alleged?
...OPD-2 & 3.
(12) Whether defendant No. 4 is the bonafide purchaser of the property for valuable consideration, as alleged?
...OPD-4.
(13) Relief."
ISSUES NO. 6 & 7.
7. No evidence in support of these issues was led by defendant No.1 apparently because the objections are legal one.
However, even the pleadings are wholly deficient and defendant No.1 has failed to establish how the plaint was neither competent nor maintainable, save and except for these bald averments, there is nothing on record to substantiate this plea. Accordingly, these issues are decided against defe ndant No.1.
ISSUE NO. 8.
8. The defendant No. 1 in order to prove this issue has examined herself as DW-1 and has stated that she is an illiterate and had entered into an agreement with the plaintiff, which was executed on 27th September, 2005. She had taken a loan of Rs.15,00,000/- from the plaintiff. She had no intention to sell the land and the house and the same was only kept as security against the aforesaid loan. After the payment of loan amount she was to get back the land and the house. The loan amount was required to be paid within 4-5 months but when the plaintiff began demanding the amount even before the date, she went to defendant No. 2, Nimat Ram, who is her husband's friend and showed him the agreement and told him that she had to pay the ::: Downloaded on - 15/04/2017 18:11:46 :::HCHP 8 plaintiff Rs.15,00,000/-. Defendant No. 2 told her that he would make the payment to plaintiff and that she should transfer the .
land and the house in his name. Defendant No. 2 neither made the payment to the plaintiff nor to her. She further states that she had transferred the land and house in the name of defendant No.2 by registered sale deed and had borne the expenses of stamp papers and registration charges. Prior to this sale deed no agreement was executed between her and Nimat Ram and Balak Ram, defendants. After seeing agreement Ex.D-1, she denied that the same contained her signatures at E-1 and E-2 respectively.
She specifically denied having received the consideration amount from Sh.Nimat Ram.
9. The defendant No.1 save and except for this bald and uncorroborated statement has led no other evidence to prove this issue. It is more than settled that any custom, usage or practice is required to be established and proved by leading cogent and convincing evidence. Having failed to do so, this issue is decided against defendant No.1.
ISSUES NO. 9 & 10.
10. The defendant No.1 has led no evidence whatsoever in support of these issues and, therefore , the issues are decided against the defendant No.1.
ISSUE NO. 11.
11. The defendants No.2 and 3 have filed common written statement wherein it has been alleged that they jointly bought the property in dispute in pursuance to the agreement to sell dated 25.05.2005 . But, when defendant No.3 appeared in the witness ::: Downloaded on - 15/04/2017 18:11:46 :::HCHP 9 box as DW-3 he has nowhere stated that the agreement dated 25.05.2005 had been executed jointly by defendants No.2 and 3 .
with defendant No.1 rather he claims that the agreement was executed by him with defendant No.1 on 25.05.2005. Similarly, when defendant No.2 entered into the witness box as DWR/1 he has stated that he had entered into an agreement with defendant No.1 vide agreement Ex.D-1. Nowhere in his statement he makes a mention of defendant No.3 or that this agreement was jointly executed by him alongwith defendant No.3. Thus, the agreement dated 25.05.2005 Ex.D-1 has not at all been proved on record.
Now in case the agreement dated 25.05.2005 is ignored, then it was the agreement of the plaintiff Ex.P-2 which was prior in point of time. No evidence has been led by defendants No.2 and 3 to show that they were bonafide purchasers of the suit property.
Accordingly, this issue is decided against defendants No.2 and 3.
ISSUE NO.12.
12. Though the defendant No.4 has not appeared in the witness box, however, her husband Pawan Kumar has appeared as DW-4/1. In examination in chief, he has stated that he is the Power of Attorney holder of defendant No.4 and placed on record its original Ex.DW-4-1/A. He states that the land and building was purchased by defendant No.4 from defendants 2 and 3 vide sale deed Ex.P-12 dated 29.09.2006. He goes on to state that prior to entering into sale deed, he alongwith his wife had checked the revenue records and had found that the defendants 2 and 3 were the recorded owners of the land. Defendants No.2 and 3 were not only in possession of the title deed, but even the ::: Downloaded on - 15/04/2017 18:11:46 :::HCHP 10 mutation in the revenue records had been attested in their favour.
He states that he alongwith his wife and children are now in .
possession of the property which they had purchased for a sale consideration of Rs.20,00,000/-.
13. In cross-examination by defendant No.1, this witness has stated that before purchasing the property, his wife had conducted an inquiry in the local area. He denied the suggestion that the plaintiff and defendant No.1 had informed her prior to execution of the sale deed Ex.P-12 that the property was already under an agreement to sell in favour of the plaintiff.
14. In cross-examination by the plaintiff, the witness state s that he is residing both at Delhi and Manali. He admitted his address as given in the plaint to be correct. He further stated that his wife before marriage was a resident of Bhunter and after filing of the suit he came to know that even the plaintiff was a resident of Bhunter. He denied the suggestion that his wife was knowing the plaintiff before the property had been purchased by her. He states that the sale deed executed in favour of defendant No.1 was also inspected by him at the Tehsil Office. He denied the suggestion that he was aware of the agreement to sell between the plaintiff and defendant No.1 and clarified that the defendants 2 and 3 were introduced to him by one friend Rupesh, who negotiated the deal.
15. Thus, from the statement of DW-4/1, it is proved beyond reasonable doubt that defendant No.4 is a bonafide purchaser of property for a valuable consideration as he has virtually not been cross-examined on any material aspects with ::: Downloaded on - 15/04/2017 18:11:46 :::HCHP 11 regard to either the sale or its consideration and even his bonafides either by the plaintiff or defendant No.1. The issue is .
decided accordingly.
ISSUES NOs.1,3,4 & 5.
16. These issues are inter-connected and are, therefore, taken up together for consideration. As the defendant No.4 has proved on record that she is a bonafide purchaser for consideration, therefore, the plaintiff cannot be held entitled to a decree for specific performance of the agreement to sell dated 27.09.2005. It is for this precise reason that the plaintiff cannot be held entitled for a decree of declaration that the sale deed executed and registered on 25.11.2005 by defendant No.1 in favour of defendants No.2 and 3 be declared as null and void and not binding on the interest of the plaintiff. Similarly, the plaintiff cannot also be held entitled to a decree declaring the sale deed registered on 29.09.2006 by defendants 2 and 3 in favour of defendant No.4 to be null and void and inoperative on the rights of the plaintiff. Now, once the plaintiff cannot be accorded the aforesaid declaration, therefore, he also cannot be held entitled to the decree for permanent prohibitory injunction. Accordingly, all these issues are answered against the plaintiff.
ISSUE NO.2.
17. The plaintiff has duly proved on record that he had paid a sum of Rs.15,00,000/- to defendant No.1. However, since defendant No.4 has simultaneously proved on record that she is a bonafide purchaser for a consideration and also in possession of the suit land, therefore, the suit of the plaintiff for specific ::: Downloaded on - 15/04/2017 18:11:46 :::HCHP 12 performance though cannot be decreed, but then the plaintiff cannot be deprived of his right to claim this amount of .
Rs.15,00,000/-.
18. Since the plaintiff has been deprived of the use of money to which he is entitled, he has a right to be compensated for the deprivation, whether it be by interest, compensation or damages. A Constitution Bench of the Hon'ble Supreme Court in Secretary, Irrigation Department, Government of Orissa and others versus G.C.Roy (1992) 1 SCC 508, held that:-
"43...(i) A person deprived of the use of money to which he is legitimately entitled has a right to be compensated for the deprivation, call it by any name. It may be called interest, compensation or damages. This basic consideration is as valid for the period the dispute is pending before the arbitrator as it is for the period prior to the arbitrator entering upon the reference. This is the principle of Section 34, Civil Procedure Code and there is no reason or principle to hold otherwise in the case of arbitrator."
19. Black's Law Dictionary (7 th Edition) defines 'interest' inter alia as:
'3. The compensation fixed by agreement or allowed by law for the use or detention of money, or for the loss of money by one who is entitled to its use; especially, the amount owed to a lender in return for the use of [the] borrowed money.'
20. According to Stroud's Judicial Dictionary of Words And Phrases (5 th Edition) interest means, inter alia, compensation paid by the borrower to the lender for deprivation of the use of his money.
21. The essence of interest in the opinion of Lord Wright, in Riches versus Westminster Bank Ltd., 1947 AC 390 :
::: Downloaded on - 15/04/2017 18:11:46 :::HCHP 13(1947) 1 All ER 469 (HL) (AC at p.400: All ER at p.472-E-F) is that:-
.
'.....it is a payment which becomes due because the creditor has not had his money at the due date. It may be regarded either as representing the profit he might have made if he had had the use of the money, or conversely the loss he suffered because he had not that use. The general idea is that he is entitled to compensation for the deprivation';
the money due to the creditor was not paid, or, in other words, 'was withheld from him by the debtor after the time when payment should have been made, in breach of his legal rights, and interest was a compensation, whether the compensation was liquidated under an agreement or statute'.
22. At this stage, it may be relevant to note that the following observations made by a Division Bench of the High Court of Punjab in CIT versus Dr.Sham Lal Narula AIR 1963 Punj 411 on the concept of 'interest' were duly approved by the Hon'ble Supreme Court in Dr.Sham Lal Narula versus CIT, AIR 1964 SC 1878, in an appeal preferred against this decision and it was held as under:-
"8. The words "interest" and "compensation" are sometimes used interchangeably and on other occasions they have distinct connotation. "Interest" in general terms is the return or compensation for the use or retention by one person of a sum of money belonging to or owed to another. In its narrow sense, "interest" is understood to mean the amount which one has contracted to pay for use of borrowed money......
In whatever category "interest" in a particular case may be put, it is a consideration paid either for the use of money or for forbearance in demanding it, after it has fallen due, and thus, it is a charge for the use or forbearance of money. In this sense, it is a compensation allowed by law or fixed by parties, or permitted by custom ::: Downloaded on - 15/04/2017 18:11:46 :::HCHP 14 or usage, for use of money, belonging to another, or for the delay in paying money after it has become payable."
.
23. Though, plaintiff has claimed damages to the extent of Rs.20,00,000/-, apart from refund of the entire sale consideration of Rs.15,00,000/-. But, I find no basis upon which the plaintiff has laid such a claim. The ends of justice would subserve if the plaintiff is granted refund of the entire sale consideration of Rs.15,00,000/- with interest at the rate of 18% per annum to be paid by defendant No.1. The issue is accordingly answered.
Relief.
24. In view of my issues-wise findings recorded hereinabove, the suit of the plaintiff is decreed to the extent that he is held entitled to the refund of entire sale consideration of Rs.15,00,000/- and is further held entitled to an interest thereupon at the rate of 18% per annum with effect from the date of execution of the agreement i.e. 27.09.2005 till the time the same is not paid by the defendant No.1. Decree sheet be prepared accordingly. Parties are left to bear their costs.
(Tarlok Singh Chauhan), Judge.
May 16, 2015 (KRS/krt) ::: Downloaded on - 15/04/2017 18:11:46 :::HCHP