Bangalore District Court
Sri.H.L.Suresha vs Mrs.P.Nagarathna on 4 April, 2017
IN THE COURT OF THE 42nd ADDL. CITY CIVIL & SESSIONS
JUDGE AT BENGALURU CITY (CCH.NO.43).
PRESENT: Sri.BAILUR SHANKAR RAMA,
B.Sc., M.A., LL.B.(Spl),
nd
42 ADDL. CITY CIVIL AND
SESSIONS JUDGE, BENGALURU.
Dated this the 4th day of April 2017.
O.S.No.1474/2010
PLAINTIFF:- Sri.H.L.Suresha,
S/o.H.N.Lingegowda,
Aged about 41 years,
R/at # 16, 2nd Floor,
13th Main, 1st Cross,
HAL 2nd Stage,
Indiranagar,
Bangalore - 560 008.
(Sri.B.C.Venkatesh, Adv.)
v.
DEFENDANTS:- 1. Mrs.P.Nagarathna,
W/o.Late Puttaswamy,
Aged about 63 years,
2. Sri.P.Manjunatha,
S/o.Late Puttaswamy,
Aged about 44 years,
3. Sri.P.Vijayakumar,
S/o.Late Puttaswamy,
Aged about 44 years,
4. Sri.P.Gopinath,
S/o.Late Puttaswamy,
2 O.S.No.1474/2010
Aged about 38 years,
5. Mrs.P.Manjula Devi,
D/o.Late Puttaswamy,
Aged about 34 years,
All are R/at # 14, HAL 2nd Stage,
Kodihally, Airport Road,
Bangalore - 560 008.
6. M/s.Deviram Projects,
A Partnership Firm,
Sadappa building,
13th Cross, C.V.Raman Nagar,
Bangalore - 560 093,
Represented by its
Managing Partners
a) Sri.S.S.Vijay Kumar,
b) Sri.K.Thulasi Ram
7. M/s.Kalasam Properties,
A Partnership Firm,
# 417, 1st Floor, 12th Cross,
Opp: To Swimming Pool,
Sadashivnagar,
Bangalore - 560 051,
Represented by its
Managing Partner
Sri.T.Shashidhar Reddy.
8. R.Shyam Sundar,
Aged about 49 years,
R/at No.90, 2nd Cross,
K.R. Layout,
Puttenahalli Main Road,
J.P.Nagar, 6th Phase,
Bangalore - 560 078.
(D1 to D5 - By Sri.P.B.Raju, Adv.
D6(a) & (b), D7 & D8 - Exparte
D8 by Sri.Nagarju.K., Adv.)
3 O.S.No.1474/2010
Date of institution of the suit : 04.03.2010
Nature of the suit : Perpetual Injunction &
Specific Performance of
Agreement of Sale
Date of commencement of : 07.02.2012
Recording of the evidence
Date on which the Judgment : 04.04.2017
was pronounced
Total Duration : Years Months Days
07 01 00
(BAILUR SHANKAR RAMA)
nd
42 ADDL. CITY CIVIL & SESSIONS JUDGE,
Bengaluru.
JUDGMENT
This is a suit filed by the plaintiff against the defendants for the relief of injunction, specific performance of Agreement of Sale and costs.
2. The brief facts as averred in the plaint are that:-
Late Sri.Puttaswamy - father of defendants 1 to 5 had purchased portion of plaint A-schedule property bearing site No.5, being part of Sy.No.26 of Ulsoor Village, Civil Station, Bangalore North Taluk, measuring East to West: 40 feet and 4 O.S.No.1474/2010 North to South: 65 feet through a registered Sale Deed dated 12.06.1974 and he was in absolute possession of the property and enjoying the same by paying taxes to the local authorities. Subsequently, he got another property under registered Release Deed dated 16.08.2003 from Sri.R.Krishna Murthy, being part of Sy.No.26 of Ulsoor Village, measuring East to West: 40 feet and North to South:65 feet and after both the properties are referred as A-schedule property. Sri.Puttaswamy had entered into Joint Development Agreement with defendant No.6 to develop A- schedule property on 25.06.2006 to put up residential apartments. On the very same day, he had also executed General Power of Attorney in favour of defendant No.6. Said Sri.Puttaswamy died leaving behind his wife, 3 sons and daughter, who are defendants 1 to 5 as his legal heirs to succeed his estate. Thereafter, defendants 1 to 5 had executed a Deed in favour of defendant No.6 in Confirmation of Joint Development Agreement on 27.06.2007 and have executed GPA and Supplemental Agreement. Later on, defendant No.6 assigned his work in favour of defendant No.7 as per Deed of Assignment of Joint 5 O.S.No.1474/2010 Development Agreement on 28.02.2008 to put the residential apartment in the A-schedule property and same was confirmed by the defendants 1 to 5 by executing the Special Power of Attorney dated 26.02.2008 along with defendant No.6 in favour of defendant No.7. Thus, defendant No.7 started to put up construction on A-
schedule property and also marketing the same in the name and style - "Kalasam Heights". The plaintiff contends that he had approached defendant No.7 with intend to purchase the apartment and entered into Agreement to Sell with defendants 1 to 6 and 7 in respect of an apartment in "Kalasam Heights" on 05.07.2008, Flat No.301, 3rd floor, along with undivided interest of 305.76 square feet in A- schedule property, which is morefully described in B- schedule property. The defendants 1 to 6 and 7 had agreed to sell B-schedule property in favour of the plaintiff for Rs.32,00,000/- and the plaintiff had agreed for the same. The plaintiff had paid advance amount of Rs.12,00,000/- at the time of execution of the Agreement, same was acknowledged by defendants 1 to 6 and 7. The plaintiff submits that the defendant No.7 has not completed the 6 O.S.No.1474/2010 construction work of the apartments and not given possession of the apartment in terms of Agreement to Sell till today. The plaintiff approached defendant No.7 several times to give him possession of the apartment and also to execute registered Sale Deed in respect of B-schedule property, but the defendants started evading to complete the project and failed to give possession of the apartment to the plaintiff. On the contrary, without completing the apartment work the defendants 1 to 7 are trying to alienate the B-schedule property to third party and trying to encumber the B-schedule property. The plaintiff submits that he is always ready and willing to perform his part of contract right from the inception of the Agreement. Even today he is ready and willing to perform his part of contract and even in future also. As per Clause No.4 of the Agreement, the defendants undertook to pay all rates, taxes, cess in regard to the schedule property upto the date of sale, but till today they have not paid the said amount and hand over the receipt to the plaintiff inspite of several demands in that regard. The plaintiff further submits that in the Agreement to Sell itself it is specifically stated that 7 O.S.No.1474/2010 there is no power to rescind the contract or forfeit the advance. On the contrary, if breach is committed by one party the other party has got only right of specific performance and recover the costs and expenses and losses of the Agreement. The defendants did not perform their part of contract though plaintiff is ready and willing to perform his part of contract. Hence, left with no option the plaintiff filed the instant suit.
3. After the service of suit summons, defendants 1 to 5 have appeared through their advocate - Sri.P.B.Raju, defendants 6 and 7 have remained exparte and defendant No.8 appeared through his advocate - Sri.Nagaraju.K. The defendants 1 to 5 have filed the written statement, contending that the plaintiff has no legal right to claim any reliefs, much less relief sought on imaginary grounds. As defendant No.6 committed breach of contract, same has been cancelled. The plaintiff's claim is under defendants 6 and 7, who cannot have any right, interest or claim in respect of suit schedule property, thus suit itself is not maintainable. The plaintiff is totally a stranger to defendants 1 to 5 and there is no privity of contract 8 O.S.No.1474/2010 between the plaintiff with them. The plaintiff has filed the suit in respect of non-existing property under fraudulent document. He has not approached the court with clean hands. The alleged Agreement to Sell cannot be enforced and suit is barred under Section XLI of the Specific Relief Act. The allegation that late Sri.Puttaswamy had entered into Joint Development Agreement with defendant No.6 to develop A-schedule property dated 25.01.2006 is denied. However, defendants 1 to 5 admit that late Sri.Puttaswamy passed away, leaving behind his legal heirs - his wife and other children to succeed his estate. But denied that legal heirs of Sri.Puttaswamy have executed Deed in favour of defendant No.6 dated 27.06.2007 and Supplemental Agreement etc. They contend that defendant No.6 has played mischief in the matter of obtaining signatures in the pretext of settlement and get relieved himself from the contract entered into with late Sri.Puttaswamy. The allegation that defendant No.6 assigned work in favour of defendant No.7 under documents, is false. The defendants 1 to 5 by executing Special Power of Attorney in favour of defendant No.7 is false and the said fact was not within the 9 O.S.No.1474/2010 knowledge of defendants 1 to 5. They contend that the defendants 6 and 7 have conspired to knock off the valuable property of defendants 1 to 5 manipulating certain documents without the knowledge and consent of the defendants 1 to 5. The allegation that he had approached defendant No.7 to purchase flat No.301 in the apartment and entered into Agreement to Sell and defendant No.7 did not completed construction work and failed to hand over the possession and not executed Absolute Sale Deed despite repeated requests and demands made by him, he is always ready and willing to perform his part of contract, what is alleged are all denied by the defendants 1 to 5. These are all the statements made and put forth a concocted story just to knock of the property. There is no cause of action to file the suit.
4. The defendants 1 to 5 contend that during the lifetime of Sri.Puttaswamy there was a contract between Sri.Puttaswamy and defendant No.6 to develop A-schedule property, but defendant No.6 with oblique and ulterior motive to knock off the entire property started to harass Sri.Puttaswamy. After his death, defendant No.6 by 10 O.S.No.1474/2010 adopting mischievous method obtained signatures of defendants 1 to 5. Therefore, those signatures were made not with free consent, as such not binding on the defendants. As defendant No.6 has showed hostile attitude towards defendants 1 to 5, contract came to be cancelled. The notice has been issued to defendant No.6 and proceeding in arbitration petition is pending before this court. Further, defendant No.6 in order to create more complications, knowing fully well that, he had no subsisting right or interest in A-schedule property, without the consent and knowledge of the defendants 1 to 5, started creating fraudulent documents. The defendants 1 to 5 are in lawful possession of the property. Therefore, the alleged documents relied by the plaintiff do not create any right or interest to the plaintiff. The defendant No.6 started development of property, however with oblique motive did not show any progress in the construction of the apartment. Later on, dispute started between them, as such the defendants 1 to 5 by issuing legal notice and paper publication, terminated / cancelled / rescinded the Joint Development Agreements dated 25.01.2006 and 11 O.S.No.1474/2010 27.06.2007, cancelled GPA dated 25.01.2006, thus the contract between defendants 1 to 5 with defendant No.6 stands legally cancelled. Therefore, question of defendant No.7 entering into sale transaction or any transaction with defendant No.6 in respect of suit schedule property doesn't arise and defendant No.6 cannot assign the contract to defendant No.7. The defendants 1 to 5 have initiated proceedings in arbitration before this court in A.A.No.841/2009. Subsequent to the said proceedings the plaintiff and defendants 6 and 7 in collusion have approached this court for a decree of permanent injunction and the plaintiff is not at all entitled to the said relief. The defendants 1 to 5 contends that to make unlawful monetary gain defendant No.6 has already alienated the suit schedule B property by executing a registered Sale Deed dated 05.10.2006 in favour of one Sri.R.Shyam Sundar. As such, the defendants 6 and 7 have no subsisting right or interest to execute the alleged Agreement to Sell in favour of the plaintiff on 05.07.2008. Therefore, suit for the relief of specific performance of contract is misconceived. It is contended that the plaintiff is knowing fully well regarding 12 O.S.No.1474/2010 the alienation already made in respect of B-schedule property, by suppressing the true and material fact has filed the instant suit, as such the plaintiff is not at all entitled to get any of the reliefs claimed in the suit and sought for dismissal of the same.
5. The defendant No.8 filed separate written statement contending that, to make unlawful gain the plaintiff has filed the instant suit, taking advantage of pendency of this suit threatening and harassing defendant No.8. He has denied all the allegations of the plaintiff. As per the Joint Development Agreement dated 25.01.2006 executed by Sri.Puttaswamy with defendant No.6 to develop A-schedule property and also on the strength of GPA dated 25.01.2006 defendant No.6 - M/s.Deviram Projects was authorized to develop the property to sell and mortgage 50% of developed property. Thus, defendant No.6 - M/s.Deviram Projects propose to sell the property bearing No.301, II Floor, measuring 1176 square feet built up area, defendant No.8 accepted the offer and purchased the property for valuable sale consideration through the Absolute Sale Deed dated 05.10.2006 he has purchased the 13 O.S.No.1474/2010 said property. The defendant No.6 was authorized to develop the property and sell his share. Late Sri.Puttaswamy did not authorize defendant No.6 to execute one more Joint Development Agreement and General Power of Attorney in favour of defendant No.7. There is no provision to appoint one agency by the agent. The alleged Confirmation of Joint Development Agreement dated 27.06.2007 and Confirmation of General Power of Attorney dated 27.06.2007, doesn't have any provision to appoint agency by the agent. Therefore, the Special Power of Attorney dated 26.02.2008 executed in favour of defendant No.7 is not maintainable in law. The defendant No.8 contends that flat No.301 was sold on 05.10.2006 to defendant No.8, defendant No.7 has no right to execute any document in favour of plaintiff - Sri.H.L.Suresh in respect of property bearing flat No.301 subsequent to the date 05.10.2006. Therefore, alleged Agreement to Sell dated 05.07.2008 based by the plaintiff is not maintainable under law. The plaintiff did not purchase any property nor paid any advance sale consideration, he has created the documents for the purpose of harassing this defendant for 14 O.S.No.1474/2010 unlawful gain. As the property was sold in favour of defendant No.8 through registered Sale Deed dated 05.10.2006 for valuable consideration of Rs.14,38,000/-, defendant No.8 is the owner and possessor of the suit B- schedule property. There is no relief claimed against defendant No.8. Initially relief is claimed for injunction against the defendants 1 to 7, after filing of written statement of defendants 1 to 5 at the stage of evidence, got amended the plaint for the relief of specific performance of Agreement of Sale and subsequently impleaded defendant No.8 by filing application on 04.06.2014, though suit was filed on 04.03.2010. There is no cause of action against defendant No.8 to implead him on 04.06.2014. The defendants 1 to 5 have filed written statement on 27.07.2010 clearly alleging that B-schedule property was sold in favour of defendant No.8 - Sri.R.Shyam Sundar on 05.10.2006 and it was brought to the knowledge of the plaintiff. Therefore, there was no cause of action against defendant No.8. As no relief is claimed against defendant No.8, suit filed by the plaintiff against him be dismissed with costs.
15 O.S.No.1474/2010
6. Basing on the rival pleadings, the following issues and additional issues are framed:-
ISSUES
1. Whether the plaintiff proves that the defendants are tying to alienate the suit schedule B property in favour of third party contrary to the Sale Agreement?
2. Whether the suit of the plaintiff in the present form is maintainable without seeking the relief of specific performance of contract?
3. Whether the plaintiff is entitled for the relief of injunction as prayed for?
4. What order or decree?
ADDITIONAL ISSUES
1. Whether the plaintiff is entitled for relief of specific performance of contract in respect of suit property?
2. Whether the plaintiff proves that the Sale Deed dated 05.10.2006 executed by defendant No.6 in favour of defendant No.8 is not binding on him?
7. The plaintiff got himself examined as PW-1 and examined one witness on his behalf as PW-2 and got marked Ex.P1 to P13. The defendants 1 and 8 have got 16 O.S.No.1474/2010 themselves examined as DWs.1 and 2 and got marked Ex.D1 to D7.
8. After the closure of the evidence, arguments were heard.
9. My answers to the above issues are as under:-
Issue No.1:- In the negative.
Issue No.2:- Doesn't survive.
Issue No.3:- In the negative.
Addl.Issue No.1:- Partly in the affirmative.
Addl.Issue No.2:- In the negative.
Issue No.4:- As per final Order.
For the following:
REASONS
10. Issue Nos.1 to 3 and Addl. Issue Nos.1 & 2:-
For the sake of convenience these issues are taken up together for discussion to avoid repetition of facts and evidence.
11. The main contention of the plaintiff is that, he has entered into Agreement to Sell dated 05.07.2008 through the GPA Holder of the defendants 1 to 5 in respect 17 O.S.No.1474/2010 of Flat No.301, 3rd floor, morefully described in plaint B- schedule. The title in respect of plaint A-schedule property was belonged to late Sri.Puttaswamy is not disputed. After his death, his wife and children, who are defendants 1 to 5, succeeded to the estate left behind by Sri.Puttaswamy. The allegation of PW.1 is that as the defendants 6 and 7 did not complete the construction of apartment, though he is always ready and willing to perform his part of contract and despite repeated requests and demands made by him in this regard, they did not hand over the possession of B-schedule property and failed to execute registered Sale Deed in his favour. On the contrary, defendant No.7 has made hectic effort to alienate the said property to third party, that is the reason initially PW-1 has filed the suit for the relief of injunction. After defendants 1 to 5 have filed the written statement and denied the right to file such suit and suit in the present form is not maintainable without seeking the relief of specific performance of Agreement to Sell, he got amended the plaint for the relief of specific performance of Agreement of Sale on the ground that the alleged Sale Deed executed by defendant No.6 in favour of defendant No.8 is 18 O.S.No.1474/2010 not binding on the rights of the plaintiff to enforce the Agreement of Sale, which is produced at Ex.P3.
12. The defendants 1 to 5 and 8 have denied all the contentions of the plaintiff. It is their contention that there is no privity of contract between plaintiff with defendants 1 to 5. As Joint Development Agreement and GPA executed in favour of defendant No.6 was already been terminated and cancelled and defendant No.6 do not have any right to execute Assignment of Joint Development Agreement with defendant No.7 and to execute Special Power of Attorney taking undue advantage of innocence of the defendants 1 to 5, mischievously and fraudulently created the documents and the very propriety of the defendants 6 and 7 to deal with the property, much less Agreement of Sale - Ex.P3 which is relied by the plaintiff was heavily attacked by the defendants, that it doesn't give any enforceable right to the plaintiff for the relief of specific performance of Agreement of Sale and he is not at all in possession, as such not entitled to any of the reliefs against defendants 1 to 5. Even after the amendment and impleaded defendant No.8, no relief is claimed against defendant No.8. Therefore, it is 19 O.S.No.1474/2010 the contention of defendant No.8 that suit against defendant No.8 is liable to be dismissed.
13. PW-1 in his evidence has deposed the facts on par with the plaint averments. Much reliance is placed by the plaintiff is on Ex.P3 - an unregistered Agreement of Sale dated 05.07.2008. In the cross-examination, PW-1 has deposed that he has negotiated with defendant No.7 -
"M/s.Kalasam Properties" - a Partnership Firm, represented by its Managing Partner - Sri.T.Shashidhar Reddy and all the documents were given to him by defendant No.7 were shown to his legal advisor and opinion was taken, only thereafter negotiated the matter. He has stated that before negotiation he has not taken EC and he has not made any efforts to contact the defendants 1 to 5 since that date. What he has deposed that, on his enquiry he has ascertained that Apartment No.301 i.e., B-schedule property was fallen to the share of Developer. In the Supplemental Deed Apartment No.301 has fallen to the share of Developer. He has clearly stated that, he has entered into Ex.P3 on the basis of Special Power of Attorney
- Ex.D1 dated 26.02.2008 in favour of defendant No.7. 20 O.S.No.1474/2010 According to the plaintiff defendant No.6 assigned his work in favour of defendant No.7 as per Deed of Assignment dated 28.02.2008 as per Ex.D2. The plaintiff has not produced those documents. In fact, DW-1 has produced those documents and got marked, confronting the same to PW-1 in the cross-examination. It is the positive case of the defendants 1 to 5 that, Ex.D2 did not authorize defendant No.7 to enter into Agreement of Sale in respect of suit B-schedule property in favour of the plaintiff by executing Ex.P3. DW-1 has deposed in her evidence that they never executed Special Power of Attorney - Ex.D1 in favour of defendant No.7. Ex.D1 reveals that it is defendant No.6 representing M/s.Deviram Projects had executed the said Special Power of Attorney in favour of defendant No.7. The acts of defendant No.7 has been attacked heavily by defendants 1 to 5 in this suit. They specifically pleaded that as defendant No.6 has violated terms of the Joint Development Agreement and misused the GPA executed by Sri.Puttaswamy in his favour and even after the death of Sri.Puttaswamy, he has created documents and acted detrimental to the rights and interests of the owners of suit 21 O.S.No.1474/2010 A-schedule property, by issuing paper publication and notice they cancelled the GPA and contract stands terminated. Therefore, they did not authorize defendant No.6 to execute any Special Power of Attorney or Assignment of Joint Development Agreement in favour of defendant No.7. Therefore, such acts done by defendant No.6 are not binding the defendants 1 to 5. Therefore, they asserted that there is no privity of contract between plaintiff with the defendants 1 to 5. Even the Supplemental Agreement dated 27.06.2007 in favour of defendant No.7, what is pleaded by PW-1, was denied by DW-1 in her evidence. The said document is marked at Ex.D3 in the cross- examination of PW-1.
14. The main point that is raised is that, an agent was not authorized to create another agency i.e., what defendant No.6 has venture to do, without the knowledge of the defendants 1 to 5 and without their consent and such acts do not bind on them. Therefore, heavy burden is on the plaintiff to prove that Ex.D1 to D3 which according to him are the documents authorized defendant No.7 to deal with the property and the Agreement of Sale which he 22 O.S.No.1474/2010 wants to enforce in this suit - Ex.P3 is a legally enforceable document and such right is vested in him. He is also expected to prove that the acts done by defendant No.7 and Agreement of Sale Ex.P3 dated 05.07.2008 is binding on them, is on the plaintiff. It is an admitted fact that the plaintiff was not delivered with possession under Agreement of Sale - Ex.P3. It is his case that construction was not at all completed and defendant No.7 has failed to deliver the possession despite his demand and request. Only on the strength of Ex.P3 the plaintiff wants to contend that interest has been created with him in respect of suit schedule property for the relief of injunction and also to enforce the said Agreement to Sell against the defendants 1 to 7 for the relief of specific performance of Agreement of Sale.
15. DW-1 in her evidence has deposed that though defendants 1 to 7 have admitted the Joint Development Agreement executed in favour of defendant No.6 dated 25.06.2006 - Ex.D5 for the purpose of effecting development, construction of multistoried building as per the terms and conditions stated therein and Sri.Puttaswamy, who was the owner of the property, had 23 O.S.No.1474/2010 executed Sale Deed in favour of M/s.Deviram Projects pursuant to Joint Development Agreement as per Ex.D4 dated 05.10.2006 and also executed General Power of Attorney in favour of M/s.Deviram Projects represented by its Managing Partners dated 25.01.2006 as per Ex.D6. It is not in dispute that Mr.S.S.Vijayakumar and Mr.K.Thulasi Ram, who are Managing Partners, were given GPA to act and deal with the property in accordance to Joint Development Agreement. DW-1 has deposed that violating the terms of Ex.D4 to D6 M/s.Deviram Projects represented by its Managing Partners, they assigned by executing Assignment of Joint Development Agreement in favour of defendant No.7 - "M/s.Kalasam Properties" as per Ex.D2 and they executed Special Power of Attorney dated 26.02.2008 as per Ex.D1 in favour of defendant No.7 and also Supplemental Agreement dated 27.06.2007 in favour of defendant No.7 on the strength of GPA. Therefore, defendants 1 to 5 - owners of the property have heavily attacked on Ex.D1 and D2 on the ground that they only entered into Joint Development Agreement with M/s.Deviram Projects - defendant No.6 and executed GPA 24 O.S.No.1474/2010 as Sri.Puttaswamy died, that is the reason they continued with the said Agreement by executing Confirmation of Joint Development Agreement dated 27.06.2007 under Ex.P1 by confirming the earlier Joint Development Agreement executed by Sri.Puttaswamy on the same terms and conditions agreed and also Ex.P2 - Confirmation of General Power of Attorney dated 27.06.2007 in favour of defendant No.6 - M/s.Deviram Projects. They also executed Supplemental Agreement dated 27.06.2007 in favour of defendant No.6 with regard to sharing of built up area, parking area and project entrusted in favour of defendant No.6 under Joint Development Agreement which was confirmed by the legal heirs of Sri.Puttaswamy i.e., defendants 1 to 5 as per Ex.D3. Therefore, DW-1 in her evidence has categorically stated in none of the Joint Development Agreements executed by late Sri.Puttaswamy and subsequent Confirmation of Joint Development Agreement and GPA in favour of defendant No.6, they did not authorize defendant No.6 to assign the development activities in favour of anybody, much less defendant No.7. Therefore, it is their contention that violating the terms and 25 O.S.No.1474/2010 conditions of the Joint Development Agreement and authority given under General Power of Attorney, defendant No.6 has created Assignment of Joint Development Agreement - Ex.D2 and Special Power of Attorney in favour of defendant No.6 as per Ex.D1, delivering possession in favour of defendant No.7 was against the right and authority confirmed on defendant No.6. Therefore Ex.D1 and D2 are not binding on the rights of the defendants 1 to 5 and the alleged Sale Agreement entered into between defendant No.7 and plaintiff - Ex.P3, which is sought to be enforced against the defendants for specific performance is not binding on the defendants 1 to 5. According to the defence set out by defendants 1 to 5 suit for specific performance of Agreement of Sale against them is not maintainable.
16. In page No.11 of cross-examination of DW-1, she has deposed that her husband died on 17.06.2006. About 8 years back the defendant No.6 stopped the construction. As per the terms and conditions of Joint Development Agreement - Ex.D5 M/s.Deviram Projects - defendant No.6 are expected to complete the construction in all respects 26 O.S.No.1474/2010 i.e., apartment building, owners constructed area within 15 months from the date of commencement of the construction with an extended period of 3 months. DW-1 has deposed that defendant No.6 has not completed the building. She and her daughters have executed supplementary documents i.e., Confirmation of Joint Development Agreement and GPA and in Ex.P1 and P2 they incorporated the very same conditions which earlier stated in Ex.D4 to D6 without adding any new terms. DW-1 specifically denied the suggestion that in the Joint Development Agreement there is a condition that Developer himself to construct or entrust the work to others also. It is suggested that in Clause No.11 of Joint Development Agreement defendant No.6 was permitted to entrust the work of construction to others also, that is specifically denied by DW-1 in her cross- examination. In the entire text of Ex.D5 - Joint Development Agreement executed in favour of defendant No.6 and in Supplemental Joint Development Agreement - Ex.P12 executed by defendants 1 to 5, no where such right was conferred on defendant No.6 to entrust the construction work to others. Therefore, DW-1 is justified in deposing 27 O.S.No.1474/2010 that defendant No.6 has violated the terms and conditions of Joint Development Agreement and the acts done by defendant No.7 is not binding on her.
17. If we go through Ex.D5 - Joint Development Agreement, owner shall get 50% of the total built up area, 50% car parking space and 50% in terrace rights along with proportionate area in the land. Likewise, defendant No;6 - Promoter shall get remaining 50% of total super built up area along with proportionate share in the land and common area. It was also agreed that the owners' constructed area shall be the absolute property of the owners and remaining 50% constructed area for which the Promoter can exercise his right. It is an admitted fact that defendant No.6 has not completed the building within the time stipulated in Ex.D5 and also subsequent Supplemental Agreement executed by the defendants 1 to 5 as legal heirs of late Sri.Puttaswamy as per Ex.P1 and P2.
18. Now, in Ex.D3 - Supplemental Agreement they clearly agreed which are all the flats constructed in the said apartment in the ground floor, first floor was agreed to be 28 O.S.No.1474/2010 taken by the owners and the flats allotted to the share of Promoter and Builder - defendant No.6 which clarifies the position that Flat No.301 in third floor, measuring 1176 square feet super built up area, was allotted to the share of defendant No.6 - Builder. The defendants 1 to 5 had no right in respect of said flat in the third floor. We can gather that Flat Nos.301 to 304 in the third floor was allotted to the share of Builder and Flat Nos.201 to 204 in the second floor was allotted the share of Builder. Therefore, in second floor and third floor, no flats were allotted to the share of the owners - defendants 1 to 5. Now, the defendants 1 to 5 have contended that defendant No.6 - M/s.Deviram Projects represented by its Managing Partners, have already sold Flat No.301 in third floor through a registered Sale Deed dated 05.10.2006 in favour of defendant No.8, who is examined as DW.2 - Sri.R.Shyam Sundar. No doubt, it has come in the evidence of DW-2 that he was also not delivered with the possession of the said flat. According to him, he had paid the entire consideration of Rs.14,38,000/- to the Builder - defendant No.6. That means, on the date of execution of Assignment of Joint Development Agreement 29 O.S.No.1474/2010 dated 28.02.2008 under Ex.D2 and Special Power of Attorney - Ex.D1 in favour of defendant No.7, already the said flat has been sold through a registered Sale Deed in favour of DW.2 - defendant No.8. Ex.D3 - Supplemental Agreement dated 27.07.2007 between defendants 1 to 5 and defendant No.6 - M/s.Deviram Projects, it is clear that Flat No.301 in third floor was allotted to the share of defendant No.6, which goes to show that even though in the original title deed of DW.2 - Ex.D7 it is wrongly mentioned that Flat No.301 is in second floor, but if we compare the Supplemental Agreement and Joint Development Agreement certainly it goes to show that no such Flat No.301 exists in second floor and even owners also do not have any claim over Flat No.301 in third floor, what could be gathered from Supplemental Agreement. Therefore, what was the understanding that flats prepared in the second floor and the third floor was allotted to the share of Promoters. If that being so, question of defendant No.7 on the strength of Ex.D1 and D2 cannot enter into the alleged Agreement of Sale - Ex.P3 dated 05.07.2008 with the plaintiff. 30 O.S.No.1474/2010
19. A thorough cross-examination was done to DW-2 in this regard. He has admitted that mistake is crept in the schedule of Ex.D7 i.e., his title deed, it should have been in third floor and despite he has repeatedly requested to construct and deliver the possession and also to rectify the mistake crept in the title deed, defendant No.6 has not done it. Therefore, the mistake in the title deed showing as second floor cannot be taken advantage by the plaintiff. When the very Assignment of Joint Development Agreement and execution of Special Power of Attorney by defendant No.6 itself was challenged by defendants 1 to 5, the right of defendant No.6 to assign the work of construction to another Builder against the terms and conditions agreed in the original GPA and Joint Development Agreement and subsequent Confirmation Deeds executed by them, doesn't authorize defendant No.6 to execute Special Power of Attorney and Assignment of Joint Development Agreement under Ex.D1 and D2 in favour of defendant No.7. Obviously, it is needless to say that none of the documents executed by the defendants 1 to 5 and previously by husband of DW.1 - Sri.Puttaswamy authorize defendant 31 O.S.No.1474/2010 No.6 to further assign the work of construction and deal with the property to others. Therefore, defendant No.6 shall act in consonance with the conditions agreed under Joint Development Agreement and the power given under GPA. It has come in the evidence that in Ex.D1 and D2 defendants 1 to 5 have not signed and their consent was not taken. Independently defendant No.6 on the strength of GPA in his favour and the Confirmation Deed executed by defendants 1 to 5, had executed Special Power of Attorney and Assignment of Joint Development Agreement in favour of defendant No.7. Therefore, defendant No.7 doesn't get any right to execute such Agreement of Sale with the plaintiff as per Ex.P3. Therefore, as rightly argued by the learned counsel for the defendants 1 to 5 that Ex.P3 cannot be enforced against defendants 1 to 5 for specific performance of Agreement of Sale.
20. In the cross-examination of DW-1, she has also made it clear that in Ex.D7 - Sale Deed executed by defendant No.6 in favour of defendant No.8 it is written Flat No.301 in second floor, but she says that in fact it should have been in third floor. A specific question was put to her 32 O.S.No.1474/2010 that any Rectification Deed or Correction Deed was executed, for that she has deposed that to the property belongs to the defendants 6 and 7 how can she execute such deed. She has categorically stated that in Ex.P12 - Supplemental Agreement dated 27.07.2007 in page No.4 Flat No.301 in third floor, measuring 1176 square feet super built up area was allotted to the share of Promoters / Builders. Therefore, it is a Developer's share, that is the reason she has stated that in the property belonged to the defendants 6 and 7 how can she execute Correction Deed or Rectification Deed in favour of DW-2. Therefore, it cannot be said that as per the terms and conditions in the Supplemental Agreement - Ex.P12 and Joint Development Agreement - Ex.P13 defendant No.7 has executed Ex.P3 - Sale Agreement in favour of the plaintiff. The photographs produced at Ex.P4 to P9 goes to show that building is half constructed, not completed as stated by DW-1 in her evidence and that is not in dispute.
21. PW-2 is examined by the plaintiff, one Mr.J.Ravindra Singh, who was the colleague of PW-1, has stated that the plaintiff was planning to purchase apartment 33 O.S.No.1474/2010 and made discussion with him and he has contacted defendant No.7 - "M/s.Kalasam Properties" and Ex.P3 - Agreement of Sale was executed and he is one of the witness to the said Sale Agreement. Merely because execution of Sale Agreement - Ex.P3 by defendant No.7 in favour of plaintiff is proved, doesn't mean that he is entitled to enforce it against the defendants 1 to 5, who are owners of A-schedule property.
22. The very fact that evidence goes to show that the defendants 1 to 5 were not consenting parties for defendant No.6 to assign Joint Development Agreement and Special Power of Attorney for construction of the building through defendant No.7, because under Joint Development Agreement he has to perform such acts which he was authorized to do for the owners of the property on the strength of GPA and not beyond that. Therefore, agent cannot assign subsequently creating further agency with third party is forbidden. As such, by virtue of Special Power of Attorney - Ex.D1 and Assignment of Joint Development Agreement, defendant No.7 is not competent to enter into Agreement of Sale - Ex.P3 in respect of suit B-schedule 34 O.S.No.1474/2010 property in favour of the plaintiff. But the contents of Ex.P3
- Agreement of Sale, the transaction and payment of part consideration amount by the plaintiff to defendant No.7 stands proved.
23. Therefore, Ex.D1 and D2 are against the conditions stated in Joint Development Agreement and General Power of Attorney, Supplemental Agreement and Confirmation Deed executed by the defendants 1 to 5 after the death of Sri.Puttaswamy in favour of defendant No.6. Under Section 7 of the Transfer of Property Act:
"Every person competent to contract and entitled to transferable property, or authorized to dispose of transferable property not his own, is competent to transfer such property either wholly or in part, and either absolutely or conditionally, in the circumstances, to the extent and in the manner, allowed and prescribed by any law for the time being in force".
If that provisions is read along with Section 55 of the Transfer of Property Act, which speaks rights and liabilities of the buyer and the seller. The seller is bound to appraise the purchaser regarding any bmaterial defect in the 35 O.S.No.1474/2010 property or in the sellers' title and buyer is not, aware, and which the buyer could not with ordinary care discover such defect. In this suit, the transaction between defendant No.7 with the plaintiff was on the strength of SPA executed by defendant No.6 in his favour (Ex.D1) and Supplementary Joint Development Agreement - Ex.D2. For the discussions made hereinabove defendant No.6 was not authorized to execute such Assignment of Joint Development Agreement and Special Power of Attorney, that is contrary to the authority given to him. He shall act only to the extent right was conferred on him and not beyond it. Therefore, he should appraise the plaintiff about the defects in his title as well as in the property. More particularly, defendant No.6 has executed registered Sale Deed - Ex.P7 dated 05.10.2006 in respect of B-schedule flat, which also reflects that defendant No.7 could not have been entered into such Agreement of Sale under Ex.P3 on 05.07.2008.
24. Further, another question arise for consideration that, whether defendant No.6 on the strength of GPA - Ex.D6 dated 25.06.2006 and Confirmation of Joint Development Agreement - Ex.P1, Deed of Confirmation 36 O.S.No.1474/2010 dated 27.07.2007 - Ex.P2, can enter into such Agreement of Sale. Here, defendant No.6 had executed Special Power of Attorney dated 26.02.2008 in favour of defendant No.7, wherein reference is made that he was the General Power of Attorney Holder of the defendants 1 to 5. The question arise that as it is styled as Special Power of Attorney, it was for a limited purpose for a single act to be performed. But the authority given under Special Power of Attorney is not to do such single specific act. Therefore, as rightly argued by the learned counsel for the defendants 1 to 5 that Ex.D1 is hit by Article 41 of the Power of Attorney Act. Therefore, the logical conclusion can be arrived at that defendant No.7 has no right to execute Sale Agreement - Ex.P3 in favour of the plaintiff. Even though subsequently duty and penalty on Ex.P3 is paid by the plaintiff, it doesn't improve its enforceability against the defendants 1 to 5. If defendant No.6 has assigned Joint Development Agreement along with Special Power of Attorney, was a Consenting Party for defendant No.7 - "M/s.Kalasam Properties" to construct the building and to sell the flats in the apartment to the extent under Supplemental Agreement - Ex.P12 those flats fallen 37 O.S.No.1474/2010 to the share of Promoter and defendant No.7 has received the part consideration amount covered under Ex.P3, they may be liable for the same and certainly not the defendants 1 to 5.
25. The specific case of the plaintiff is that apartment work was not completed, despite he has requested repeatedly and demanded for execution of registered Sale Deed in his favour, defendant No.7 did not complete the construction work. Here, initially the plaintiff has filed the suit for the relief of injunction, later on converted it for the relief of specific performance of Agreement of Sale. If we go through the pleadings his relief is based on Ex.P3 and denial by the execution of Sale Deed by defendant No.7 despite his repeated requests without completion of the building, though he is always ready and willing to perform his part of contract, but necessarily the pleadings are not in conformity with Order VI Rule 3 and 4 of CPC read with Forms 47 and 48. Therefore, certainly as rightly argued by the learned counsel for the defendants 1 to 5 that, it doesn't fall within the ambit of Section 16(c) of Specific Relief Act. Ex.P10 is the Letter issued by the Bank. Home Loan Facility 38 O.S.No.1474/2010 availed by the plaintiff from the said bank. He has not averred the same in the original plaint and even this is not the sanction letter. It is only an invitation to offer and absolutely there is no concluded contract, can very well be gathered. Therefore, such contract cannot be enforceable against the defendants 1 to 5. Under Section 14(b) of the Specific Relief Act also such Agreement is unenforceable.
26. Therefore, what DW-1 in her examination-in-chief para No.15 that as defendant No.6 - M/s.Deviram Projects with oblique motive did not show any progress in construction of the apartment and failed to resolve the differences. By issuing legal notice, paper publication, terminated / cancelled / rescinded the Joint Development Agreement dated 25.01.2006 and 27.06.2007 and also cancelled and terminated General Power of Attorney dated 25.01.2006. Thus, contract with defendant No.6 stands legally cancelled and in respect of the same before this court A.A.No.841/2009 is pending, but not produced any documents to substantiate her such contentions. Whatever may be, that is the subject matter to be decided in A.A.No.841/2009. But question before this court is that, 39 O.S.No.1474/2010 whether the transaction between defendant No.6 with defendant No.7 and acts done by defendant No.7 executing Agreement of Sale - Ex.P3 in favour of the plaintiff, does it bind the defendants 1 to 5. For the obvious reasons discussed hereinabove, such acts are not binding on them in any manner and the plaintiff cannot enforce the alleged Agreement of Sale - Ex.P3 against the defendants 1 to 5.
27. Even in the cross-examination of DW-1, she has stated that defendant No.6 has filed suit and it is pending, nothing is produced in this regard and in the said suit, the plaintiff was not impleaded. She has deposed that she is not concerned with the plaintiff, but admits that present suit schedule property was the subject matter in that suit. No doubt, the defendants 1 to 5 did not file any criminal complaint against defendant No.6. In Ex.P3 sale consideration was fixed for Rs.32,00,000/-, part consideration amount of Rs.12,00,000/- was paid by the plaintiff to defendant No.7 is proved by the evidence of PWs.1 and 2. But the defendants 1 to 5 have no concern whatsoever with defendant No.7.
40 O.S.No.1474/2010
28. However, in the cross-examination DW-1 has stated that the flats to be constructed in second floor and third floor allotted to the share of Promoter/Builder - defendant No.6 and she has agreed that as the said property belonged to defendant No.6, how could she deal with the said property. This goes to show that the Joint Development Agreement, Supplemental Agreement executed by them and to the extent of constructed area fallen to the share of Promoter/Builder the defendants 1 to 5 doesn't have any right. In this view of the matter, though suit for the relief of specific performance of Agreement of Sale - Ex.P3 against the defendants 1 to 5 is not maintainable, but his suit against the defendants 6 and 7 is maintainable. Because suit B-schedule property - Flat No.301, Third Floor of "Kalasam Heights" which was taken up by defendant No.7 under the Supplemental Joint Development Agreement in his favour, for which the defendants 6 and 7 alone are responsible. But in view of the fact that defendant No.7 was not authorize to deal with the suit schedule flat under Ex.D1 and D2. Much prior to the execution of Ex.D1 and D2 in favour of defendant No.7 41 O.S.No.1474/2010 by defendant No.6, M/s.Deviram Projects have already sold the said property in favour of defendant No.8 - Sri.R.Shyam Sundar. Therefore, that flat even if after completion of construction not available for them to execute Absolute Sale Deed in favour of the plaintiff after receiving balance consideration amount from him.
29. If that being so, even though contract is barred against the defendants 1 to 5, but as huge amount of Rs.12,00,000/- towards part consideration was received by defendant No.7 and the defendants 6 and 7 have taken up for construction work and under Joint Development Agreement suit B-schedule flat fallen to the share of the Builder, but enforcement of Agreement of Sale for execution of Absolute Sale Deed with delivery of possession after receiving balance consideration from the plaintiff under the circumstances is not possible.
30. The learned counsel for the defendants 1 to 5 has relied on a decision reported in ILR 2014 KAR 5778, in the case of Smt.Asharaj and others v. S.G.Nagaraj @ Suga 42 O.S.No.1474/2010 Nagaraj, in para 33 and 34 of the said decision their lordships have discussed at length with regard to:
"Proof of readiness and willingness as mandated under Section 16(c) of the Specific Relief Act, is an absolute necessity to seek the equitable relief of specific performance, There must not only the clear pleading in regard to the readiness but also unimpeachable evidence must be adduced to prove the same. A person seeking benefit of specific performance of contract must manifest that his conduct has been blemishless throughout to have the relief of specific performance".
31. The learned counsel for the defendants 1 to 5 has relied on a decision reported in AIR 2015 Karnataka 1, in the case of M.V.Prema Chandra and another v. Smt Sarojamma and others, wherein it is ruled that:
"Proof of payment of the purchase, money if no document is available to show that the Vendee had cash, Vendee not entitled for the relief of specific performance. Latches on the part of Vendee and Vendee accepted to exercise their right of specific performance at the earliest without giving room for latches. Latches on the part of Vendee would disentitles the Vendee for specific relief of specific 43 O.S.No.1474/2010 performance as it shows non-readiness and non-willingness.
Here, in this case though PW-1 pleaded that several times he has requested defendant No.7 to complete the flat and to execute the registered Sale Deed after receiving balance consideration, he has not completed, question is to enforce the specific performance even though time was not made the essence of the contract. But proof of readiness and willingness to perform his part of contract and he is ready with balance consideration amount, need be proved to the satisfaction of the court. Of course, the evidence given by PW-1 was not challenged by the defendants 6 and 7, because the contract was entered into between defendant No.7 and plaintiff as per Agreement of Sale - Ex.P3. Both the defendants 6 and 7 remained exparte. Therefore, we can gather that, the position of PW-1 that he is doing business and according to him he is having sufficient money with him to pay the balance consideration amount and that was appraised to defendant No.7. Whenever such request was made, but even the allegation of DW-1 that defendant No.6 has not completed the building within the stipulated 44 O.S.No.1474/2010 time as agreed under Joint Development Agreement and they have taken measures to cancel and terminate the Joint Development Agreement. Whatever may be, there is an admission by DW-1 in the cross-examination that building was constructed by defendant No.6 under the Joint Development Agreement, General Power of Attorney and Sale Deed executed in their favour and flats formed in second floor and third floor are fallen to the share of defendant No.6 as could be seen from Ex.P12 and she admits the ownership of defendant No.6 on the flats constructed in second floor and third floor. Therefore, we can say that PW-1 was capable enough to get the Sale Deed in his favour and it cannot be said that he doesn't have sufficient money with him and he was not ready and willing to perform his part of contract.
32. The learned counsel has relied on a decision reported in ILR 2015 KAR 2809, in the case of Sri.T.S.Channegowda v. Sri.H.Thoppaiah and another, wherein also the principles regarding readiness and willingness and essentials were elaborately discussed. The other decision relied is reported in ILR 2014 KAR 233, in 45 O.S.No.1474/2010 the case of Smt.Padmini Raghavan v. Mr.H.A.Sonappa, since dead by his LRs and others, wherein their lordships have discussed the essentials and basic principles need be taken into consideration by the court while granting the relief of specific performance of Agreement of Sale, as it is purely a discretionary relief.
33. Other decision relied is reported in AIR 2009 Supreme Court 1749, in the case of G.Jayashree and others v. Bhagawandas S.Patel and others, wherein the lordships have observed that:-
"When relief was available for filing suit for specific performance of Agreement of Sale, instead of seeking that relief filing suit for different relief which speaks volumes about his conduct, which disentitles such person to get the relief of specific performance".
Here in this suit initially the plaintiff filed the suit for injunction and after the defendants 1 to 5 filed written statement got converted the suit for the relief of specific performance on 14.06.2011. Here, when building was not completed as per the terms agreed under the Agreement, he has been insisting defendant No.7 to complete the 46 O.S.No.1474/2010 building and hand over the possession and to execute the registered Sale Deed after receiving balance consideration. Therefore, what prompted him to file injunction suit on the ground that defendant No.7 and the owners are making hectic efforts to sell the said flat to the third party, immediately he has filed the suit for the relief of injunction. He could have filed the suit for specific performance at the initial stage itself, but as building was not at all completed we can take a view that, that alone cannot be a sole ground to reject the claim made by the plaintiff for the relief of specific performance. Issue No.2 was raised at the time suit was filed for the relief of injunction based on the defence raised by the defendants. As subsequently suit was converted for the relief of specific performance of contract, Issue No.2 doesn't survive for consideration.
34. The other decision relied is AIR 1990 Supreme Court 682, in the case Abdul Khader Rowther v. P.K.Sara Bai and others, wherein their lordships have held as under:
"(B) Civil P.C. (5 of 1908), O.6 R.4, Sch.I App.A, Sch.I Form 47, Sch.I Form 48 Pleadings 47 O.S.No.1474/2010
- Specific performance of covenant for reconveyance - Pleadings and evidence - No Pleadings that plaintiff was willing to specifically perform his part as required by Forms 47 and 48 of Sch.I - Equitable relief could not be granted".
Here, the plaintiff got converted the suit subsequently for the specific performance of contract, though his pleadings was not fully in consonance with requirement of Order VI Rule 4. But under the peculiar circumstances of the present case, this court is of the view that at any rate as building has not been completed and defendant No.6 has already sold the Flat No.301 in the third floor in favour of defendant No.8 under Ex.D7. Though in the registered Sale Deed of DW-2 it was wrongly mentioned as Flat No.301 in the second floor, but it is an admitted fact that as per the Joint Development Agreement as well as Supplemental Agreement only flats formed in second floor and third floor were fallen to the share of Promoter and there is no Flat No.301 in the second floor. Therefore, defendant No.7 cannot and could not have entered into an Agreement of Sale under Ex.P3 with the plaintiff. Therefore, only 48 O.S.No.1474/2010 alternative remedy under Section 20 of the Specific Relief Act, the court can consider the case of the plaintiff and certainly not under Section 16(1)(c) of the Specific Relief Act.
35. In the decision reported in AIR 2003 Supreme Court 1391, in the case of Manjunath Anandappa Urf Shivappa Hanasi v. Tammanasa and others, wherein also their lordships have laid down that:
"Even though time was not made essence of contract but party should approach the court for the relief of specific performance of contract within a reasonable time. Having regard to the conduct of the plaintiff, the court can even refuse to grant the relief on the said ground".
Here, in this case Agreement of Sale - Ex.P3 is dated 05.07.2008, he has not issued any legal notice. In the evidence he has stated that, he has made repeated request with defendant No.7 to complete the building and to execute the registered Sale Deed in his favour. This is also one of the strong ground disentitles the plaintiff to enforce the Agreement of Sale. Thus, for all the detailed 49 O.S.No.1474/2010 discussions made hereinabove, the analytical appreciation of the evidence brought on record both oral and documentary, defendant No.6 had no authority to execute Assignment of Joint Development Agreement - Ex.D2 dated 28.02.2008 and Special Power of Attorney as per Ex.D1 in favour of defendant No.7. Therefore, the act done by defendant No.6 is not binding on the owners of the property
- defendants 1 to 5. Further, defendant No.7 had no right to execute Agreement of Sale - Ex.P3 in favour of the plaintiff for the reasons that defendant No.6 had already sold the said flat to be constructed in the said apartment in favour of defendant No.8 - Sri.R.Shyam Sundar. Looking from any angle the plaintiff's suit against the defendants 1 to 5 as well as defendant No.8 is not maintainable. No relief is claimed against defendant No.8. He can't enforce alleged Agreement of Sale against the defendants 1 to 5. Even evidence brought on record manifestly makes it clear that under Joint Development Agreement, subsequent Confirmation Deed, Sale Deed executed in favour of defendant No.6, that was also confirmed by defendants 1 to 5 and Supplemental Deed of Agreement and admission of 50 O.S.No.1474/2010 PW-1 in the cross-examination that defendant No.6 - M/s.Deviram Projects by spending huge amount have put up the structure. The expenditure done by them, losses suffered by them also need be appreciated and ownership right over the flats formed in the second and third floor of the said building belonged to defendants 6 and 7 is not disputed by the plaintiff. Even though the acts done by defendant No.7 is not binding on defendants 1 to 5, however mutually between defendants 6 and 7 there was an Agreement between them and it has come in the evidence that defendant No.7 - "M/s.Kalasam Properties" have put up construction and defendant No.7 has received part consideration amount of Rs.12,00,000/- from out of the sale consideration agreed of Rs.32,00,000/-. Therefore, the defendants 6 and 7 have become unduly enriched by utilizing that money for their business. Therefore, it is a discretionary relief and looking from any angle it is impossible for defendant No.7 to execute registered Sale Deed in favour of the plaintiff.
36. Therefore, this court is of the considered view that by following the principles laid down in the decision 51 O.S.No.1474/2010 reported in 2015 AIR SCW 6014, in the case of Hemanta Mondal and others v. Ganesh Chandra Naskar, wherein their lordships have considered the scope of Section 20 of the Specific Relief Act, how discretion to be exercised by the court. As it is the relief purely a discretionary relief. In the present case on hand, the building which was taken up for construction by defendants 6 and 7 is not completed, possession of the flat was not delivered to the purchaser or even the share allotted to the owner, that portion possession is also not given. Therefore, the photographs produced goes to show that half construction was made and it was an incomplete building and evidence of DW-1 shows that defendant No.6 has completely stopped further construction. Even though she has taken measures for cancellation of Agreement, that is subject matter of another suit because Arbitral Agreement is also there in the Joint Development Agreement. Therefore, under such circumstances, only remedy available that the Promoter/Builder also incurred huge expenditure in construction and even the plaintiff is able to show that he is entitled for enforcement of contract of Agreement of Sale, 52 O.S.No.1474/2010 then also it is a discretionary relief, the court can refuse to grant the relief if circumstances warrants that discretion cannot be exercised in favour of the plaintiff. Here, defendant No.7 has no right to enter into contract at all with the plaintiff. Even otherwise, the defendants 6 and 7 have ventured to put up construction and admittedly the subject matter of B-schedule flat was fallen to the share of Promoter. Therefore, the plaintiff can certainly entitled to get refund of part consideration amount of Rs.12,00,000/- paid under Ex.P3 to defendant No.7 from both defendants 6 and 7 and certainly not against defendants 1 to 5 and 8. It is just and proper to direct defendants 6 and 7 the vendors to pay back the amount of earnest money with reasonable interest to the plaintiff. Therefore, it is held that the plaintiff has proved that he is entitled to get the alternative relief claimed for refund of earnest money received. If the defendants 6 and 7 are directed to pay Rs.12,00,000/- the earnest money received under against - Ex.P3 dated 05.07.2008 to the plaintiff along with interest at the rate of 10% p.a. from the date of Agreement that will be just and reasonable.
53 O.S.No.1474/2010
37. Under such circumstances, though PW-1 has stated that the defendants 6 and 7 colluded with the owners are trying to alienate the property to others in detrimental to the rights accrued to the plaintiff under Agreement of Sale - Ex.P3 and he is entitled to get the relief of permanent injunction. But for the detailed discussions made hereinabove, it is needless to say that the plaintiff has failed to prove that Ex.P7 - Registered Sale Deed executed by defendant No.6 in favour of defendant No.8 is not binding on his rights. He cannot enforce Ex.P3 - Agreement of Sale for the relief of specific performance of contract, therefore only he is entitled for alternative relief for refund of earnest money along with reasonable interest. Therefore, he has failed to prove even Issue No.3 and Addl. Issue No.2. Accordingly, I answer Issue Nos.1, 3 and Addl. Issue No.2 in the negative and Issue No.2 - doesn't survive and Addl. Issue No.1 partly in the affirmative.
38. Issue No.4:-
For the forgoing reasons, I proceed to pass the following:-54 O.S.No.1474/2010
ORDER Suit filed by the plaintiff against the defendants is hereby partly decreed.
The relief claimed for specific performance of contract and also for permanent injunction is hereby dismissed.
Alternatively, the defendants 6 and 7 are directed to refund Rs.12,00,000/- the earnest amount received under Agreement of Sale - Ex.P3 along with interest at the rate of 10% p.a. from the date of Agreement till realization and also to pay costs of the suit.
The claim made by the plaintiffs against defendants 1 to 5 and 8 is accordingly dismissed.
Draw a decree accordingly.
(Dictated to the Judgment Writer on computer, typed by her, the transcript thereof corrected and then pronounced by me, in open Court, this the 4th day of April 2017) (BAILUR SHANKAR RAMA) ND 42 ADDL. CITY CIVIL & SESSIONS JUDGE, Bengaluru.55 O.S.No.1474/2010
ANNEXURE I. List of witnesses examined on behalf of:
(a) Plaintiff's side:
PW.1 - Mr.H.L.Suresha PW.2 - Mr.J.Ravindra Singh
(b) Defendants' side:
DW.1 - Smt.P.Nagarathna DW.2 - Mr.R.Shyam Sundar II. List of documents exhibited on behalf of:
(a) Plaintiff's side:
Ex.P1 : Certified copy of Confirmation of
Joint Development Agreement
dated 27.06.2007
Ex.P2 : Copy of Confirmation of General
Power of Attorney dated
27.06.2007
Ex.P3 : Original Agreement to Sell dated
05.07.2008
Ex.P3(a) : Signature of GPA Holder of
Vendors
Ex.P3(b) : Signature of Developers
Ex.P3(c) Signature of purchaser
Ex.P3(d) : Signature of PW-2
Ex.P4 to 9 : 6 Photographs
Ex.P10 : Letter of IDBI Bank
Ex.P11 : Certified copy of Supplemental
Agreement dated 27.06.2007
Ex.P12 : Certified copy of Supplemental
Agreement dated 27.06.2007
Ex.P13 : Certified copy of Joint
Development Agreement dated
25.01.2006
56 O.S.No.1474/2010
(b) Defendants' side:
Ex.D1 : Certified copy of Special Power of
Attorney dated 26.02.2008
Ex.D2 : Assignment of Joint Development
Agreement dated 28.02.2008
Ex.D3 : Supplemental Agreement dated
27.06.2007
Ex.D4 : Certified copy of Sale Deed dated
05.10.2006
Ex.D5 : Certified copy of Joint
Development Agreement dated
25.01.2006
Ex.D6 : Certified copy of General Power of
Attorney dated 25.01.2006
Ex.D7 : Original Sale Deed dated
05.10.2006
42nd ADDL. CITY CIVIL & SESSIONS
JUDGE, BENGALURU.