Karnataka High Court
Sri.P. Narendra vs Sri.Katta Subba Rao, on 23 July, 2021
Author: R.Devdas
Bench: R.Devdas
IN THE HIGH COURT OF KARNATAKA
DHARWAD BENCH
DATED THIS THE 23RD DAY OF JULY, 2021
PRESENT
THE HON'BLE MR. JUSTICE R.DEVDAS
AND
THE HON'BLE MS. JUSTICE J.M.KHAZI
R.F.A. NO.100334/2016
Between:
1. Sri.P. Narendra S/o Suryanaryana,
Aged about 49 years, Occ: Agriculture,
2. Smt.Usha Kumari W/o P. Narendra,
Aged about 44 years, Occ: Agriculture,
Both are residents of Badanahatti Road,
Kurugodu Village, Ballari Taluk and District.
Pincode-583116
...Appellants
(By Sri.S.A.Sandur & Sri.B.S.Sangati, Advs.)
And:
Sri.Katta Subba Rao S/o Venkateshulu,
Aged about 64 years, Occ: Agriculture,
R/o: Thimmapura Village, Ballari Taluk and District.
Pincode-583101.
...Respondent
(By Sri.T.Basavana Goud, Adv.)
This RFA is filed under Order 43 Rule 1 r/w Sec.96 of
CPC against the judgment and decree dated 16.08.2016
passed in O.S. No.166/2012 by the Court of I Additional
Senior Civil Judge, Ballari decreeing the suit filed for specific
performance.
This RFA having been heard and reserved for judgment
on 13.07.2021, coming on for pronouncement of judgment
this day, J.M.Khazi J., delivered the following:
RFA NO.100334/2016
2
JUDGMENT
Being aggrieved by the judgment and decree dated 16.08.2016 in O.S No.166/2012 on the file of the I Addl. Senior Civil Judge, Ballari, by which suit of the plaintiff came to be decreed with cost, directing defendant Nos.1 and 2 to execute registered sale deed in favour of plaintiff in respect of suit schedule properties after receiving balance consideration of `1,75,000/- from plaintiff and also to discharge the bank loan within 60 days from the date of the judgment and decree, failing which the plaintiff is at liberty to pay the outstanding bank loan with liberty to recover the same from defendant Nos.1 and 2 jointly and severally, further, if defendant Nos.1 and 2 fail to execute the registered sale deed, then plaintiff is at liberty to get it registered through Court, defendant Nos.1 and 2 have filed this appeal under Order 43 Rule 1 read with Section 96 of CPC.
2. For the sake of convenience the parties are referred to their rank before the Trial Court.
3. It is the case of the plaintiff that defendant Nos.1 and 2 are the owners of suit schedule properties i.e., item RFA NO.100334/2016 3 Nos.1 and 2 respectively and they jointly agreed to sell the suit schedule properties for a sum of `17,25,000/- and on 02.06.2008 they have executed a sale agreement by receiving `4,50,000/- and they agreed to execute the regular sale deed within a period of three months i.e., on or before 02.09.2008 at the cost of the plaintiff, after discharging the bank loan and getting the land surveyed. The plaintiff has further contended that, within a period of three months, defendant No.1 approached the plaintiff with a request to extend the period fixed for the execution of the sale deed and requested plaintiff to pay further sum of `6,00,000/- and after receipt of the said sum, he has endorsed on the back side of the sale agreement by extending the period by six months.
4. It is further case of the plaintiff that inspite of his repeated request and demand, defendants did not get the land surveyed and once again on 28.07.2009, defendant No.1 requested and received another sum of `5,00,000/- under the pretext of repaying the bank loan and securing no due certificate and endorsed on the back portion of the sale agreement. Plaintiff has alleged that, inspite of receiving substantial sum of `15,50,000/- out of the total sale RFA NO.100334/2016 4 consideration of `17,25,000/-, defendant Nos.1 and 2 have not come forward to execute the sale deed and therefore without any alternative he has filed the suit.
5. Defendants have appeared and filed written statement admitting that they are the owners of the suit schedule properties. However, they have denied that they agreed to sell the suit schedule properties for a total sum of `17,25,000/- and have received `4,50,000/-, `6,00,000/- and `5,00,000/- as pleaded in the plaint. They have pleaded that, plaintiff is running a stone crusher in the land adjoining the suit schedule properties, on account of which the crops in the lands of defendants were damaged and destroyed and therefore, plaintiff has advanced `4,50,000/- to the defendants by way of interest free loan and at that time, he has got executed the document in question by way of security to the amount advanced and has sought for dismissal of the suit.
6. Based on the pleadings, the Trial Court has framed the following issues:
RFA NO.100334/20165
1. Whether the plaintiff proves that on 2.6.2008, the defendants entered into an agreement of sale of suit schedule property with him for sale consideration of `17,25,000/- by receiving part of sale consideration of `4,50,000/-?
2. Whether the plaintiff proves that the defendants failed to execute registered sale deed within the stipulated time inspite of several requests and demands?
3. Whether plaintiff proves that he was ever ready and willing to perform he part of contract?
4. Whether defendants prove that the alleged agreement of sale is concocted document?
5. Whether the plaintiff is entitled to the relief of specific performance?
6. Whether the plaintiff is entitled to the relief claimed in the suit?
7. What order or decree?
7. In support of the plaintiff's case, plaintiff has examined himself as PW.1 and four witnesses as PWs.2 to 5. RFA NO.100334/2016 6 He has got marked Exs.P1 to P9. On the other hand, defendant Nos.1 and 2 have examined themselves as DWs.1 and 2, they have examined two witnesses as DWs.3 and 4. They have relied upon Exs.D1 to 11.
8. After hearing arguments of both sides, vide the impugned judgment and decree, the Trial Court has held that the plaintiff has proved that the document in question i.e., the sale agreement is executed by defendant Nos.1 and 2 and they have received `4,50,000/- at the first instance and subsequently `6,00,000/- and `5,00,000/- i.e., in all they have received `15,50,000/-. The Trial Court has also held that, for the sake of this suit, defendants have taken up a false defence that the document in question is executed by way of security to the hand loan advanced by the plaintiff to defendant No.1. Consequently, the Trial Court has decreed the suit directing the defendants to receive the balance consideration and execute the regular sale deed and on their failure, get it executed through the Court.
9. We have heard the learned counsel representing the defendants as well as the plaintiff and perused the record. RFA NO.100334/2016 7
10. The learned counsel representing the defendants submitted that the impugned judgment and decree are illegal and contrary to the material and evidence on record and liable to be set aside. It is perverse and capricious and as such not sustainable in the eye of law. The Trial Court has failed to consider that the grant of relief of specific performance is discretionary relief and defendants have no other properties except suit schedule properties and they will be put to more hardship than the plaintiff in case the specific performance is granted and on this ground, they are seeking reversal of the impugned judgment and decree.
11. He has further argued that the Trial Court has failed to appreciate that the legal notice dated 23.07.2012 at Ex.P5 is issued after a prolonged gap of the alleged transaction and the plaintiff has not explained the delay and his conduct establish the fact that he was not ready and willing to perform his part of the alleged contract and on this ground the impugned judgment and decree is liable to be set aside.
RFA NO.100334/20168
12. The learned counsel further submits that the Trial Court has failed to appreciate the fact that attesting witness to Ex.P1 are interested witnesses and as such their evidence cannot be believed. He would submit that the Trial Court has failed to appreciate that Ex.P1 was executed as a collateral security for the amount borrowed from the plaintiff and it is not an agreement of sale and consequently the judgment and decree based on the said document is liable to be set aside and prays to allow the appeal.
13. On the other hand, the learned counsel representing the plaintiff submits that after going through the oral and documentary evidence placed on record and in the light of the pleadings, the Trial Court has come to a correct conclusion that plaintiff is entitled for relief of specific performance. He further submitted that, all along defendants have taken up a false defence and have failed to establish the same and rightly the Trial Court has rejected their defence and exercised the discretionary power to grant the decree and prays to dismiss the appeal.
RFA NO.100334/20169
14. Thus plaintiff is seeking specific performance of contract based on the sale agreement at Ex.P1. According to him, defendants agreed to sell the suit schedule property for a total sum of `17,25,000/- and on the date of executing Ex.P-1 i.e., on 02.06.2008, they have received `4,50,000/- agreeing to execute the sale deed after repaying the bank loan and also getting the land surveyed. It is further case of the plaintiff that before the expiry of the three months, again defendants approached him and after receiving `6,00,000/- made endorsement in Ex.P1 by extending three months' time for executing the sale deed. Plaintiff has further contended that on 28.07.2009 once again defendant No.1 has received `5,00,000/- and made endorsement on the back of Ex.P1 and instead of repaying the bank loan and getting the land surveyed and executing the sale deed, defendants went on postponing the same and ultimately after issuing legal notice, the plaintiff has constrained to file the suit.
15. It is not in dispute that the defendants are the owners of the suit schedule property and they have executed Ex.P1 by receiving `4,50,000/-. However, they claim that Ex.P1 is not a sale agreement. On the other hand, according RFA NO.100334/2016 10 to the defendants, it is a document executed by them by receiving hand loan of `4,50,000/- and it was a interest free loan. According to the defendants, the reason for the plaintiff in advancing `4,50,000/- to them is that he is running a stone crusher adjacent to the suit schedule property and on account of the running of the stone crusher, the defendants have suffered loss and therefore this document came to be executed while taking loan of `4,50,000/-. Defendants have specifically denied of having received additional sum of `6,00,000/- and `5,00,000/- and executing the endorsement on the back of Ex.P1.
16. Plaintiff has entered into the witness box and given evidence with regard to the transaction that took place between him and the defendants.
17. PWs.2 and 3 are the attesting witness to Ex.P1. They have deposed to that effect. PW.4 is the cousin brother of the scribe of Ex.P1. It appears the scribe of Ex.P1 is no more and therefore the plaintiff has examined his cousin brother to prove the fact of the scribe having written Ex.P1 by way of secondary evidence. Having acquainted with the hand RFA NO.100334/2016 11 writing of the scribe, PW.4 has deposed that the sale agreement in question is written by his brother Adi Basavaraju. He has denied that the endorsement on Ex.P2 is with regard to returning of the amount. However, the contents of Ex.P1 as well as the endorsement are contrary to the suggestions made to the Plaintiff and his witnesses. Through the evidence placed on record, the Plaintiff has proved that Ex.P1 is executed by defendant Nos.1 and 2 and at the first instance, they received `4,50,000/- and subsequently they have received `6,00,000/- as well as `5,00,000/- and have failed to execute the sale deed.
18. In the written statement, defendants have taken up a specific contention that, adjacent to the suit schedule property, plaintiff is running a stone crusher and as a result of the same, defendants have suffered crop loss and therefore `4,50,000/- was advanced to defendants by the plaintiff by way of compensation and it was an advance without interest. To disprove this fact, plaintiff has examined PW.5 Nallapuneni Subba Rao. It is relevant to note that the name of the plaintiff is Katta Subba Rao. PW.5 during the course of his evidence has clearly deposed that he is the adjacent land owner of the RFA NO.100334/2016 12 suit schedule property and he is the one who is running the stone crusher. His evidence belies the defence taken by the defendants that it is the plaintiff who is running the stone crusher and he has caused loss to the defendants and therefore he has paid `4,50,000/- by way of interest free advance.
19. Even though during the course of written statement, defendants have denied of having executed a sale agreement as per Ex.P1 agreeing to sell the suit schedule properties to the plaintiff and have received in all `15,50,000/- from the plaintiff and during the course of his affidavit evidence, defendant No.1 has reiterated the same, during his cross-examination, he has admitted that by mortgaging the suit schedule properties, he has taken loan from banks. Though he has claimed that he has repaid the loan in question, as admitted by him, he has not produced any documents to evidence the said fact. At para 3 of his cross- examination, defendant No.1 has admitted that the contents of sale agreement at Ex.P1 are true and correct and on that day he has received `4,50,000/- by way of advance and this fact is reflected in Ex.P1. He has also admitted that, in Ex.P1 it RFA NO.100334/2016 13 is noted that `12,75,000/- is due and it is to be paid within three months and he has also agreed to execute the sale deed with respect to suit schedule properties. He has also identified the endorsement as well as his signatures in Ex.P1 i.e., in the back portion of page No.1 of Ex.P1 and it is marked as Ex.P2. His signatures in the endorsement on the back portion of page 1 are marked as Ex.P2(a) and Ex.P3(a). However, he has denied that, while affixing his signature at Ex.P2(a) he has received `6,00,000/- and on 28.07.2009, while affixing his signature at Ex.P3(a), he has received `5,00,000/-. On this aspect he has volunteered and stated that these two signatures were taken at the time of execution of Ex.P1 at the first instance itself. Nowhere in the written statement, defendants have pleaded that signature of plaintiff was taken to Ex.P1, P2(a) and P3(a), at the first instance when the document was executed on 02.06.2008 itself. It is clearly an improvement made to overcome the admissions given by him and is an after thought.
20. Defendant No.1 has admitted that, before filing the suit, plaintiff has issued legal notice dated 23.07.2012. However, he has claimed that he has received the notice after RFA NO.100334/2016 14 the suit was filed. But he has admitted that he has sent reply notice dated 27.07.2012. The suit is filed on 28.07.2012 and therefore the say of the defendant No.1 that he has received the legal notice after the suit was filed is not correct.
21. Defendant No.2 has also given evidence. During her cross-examination she has claimed that, when they objected for the plaintiff running a stone crushers adjacent to the suit schedule property, he has paid them `4,50,000/- and got their signatures to blank stamp paper. The evidence of defendant No.2 is clearly an improvement and contrary to the defence putforth in the written statement as well as the evidence of defendant No.1. When suggested that defendant No.1 has received balance consideration of `6,00,000/- and `5,00,000/- under the pretext of repaying the bank loan, she has expressed ignorance. However, she has not denied the said suggestion. At the end of her evidence, she has stated that when the amount was paid on the second occasion, she has not signed it.
22. When suggested that on the third occasion when plaintiff paid money to defendant No.1 she has not affixed her RFA NO.100334/2016 15 signature, DW.2 has expressed ignorance. The examination of evidence of DWs.1 and 2 makes it evident that inspite of receiving total sale consideration of `15,50,000/- and executing Ex.P1 as well as the endorsements at Exs.P2 and 3 intentionally, they have denied the said fact and have putforth a false defence.
23. Even though defendants have claimed that, to compensate the loss suffered by the defendants, plaintiff had advanced `4,50,000/- to them by way of interest free loan, there is nothing on record including the pleadings by defendants that they have made any attempt to repay the said amount to the plaintiff. This also makes it evident that the defendants have taken up a false plea. The evidence of PW.5 Nallapuneni Subba Rao establish the fact that he is the adjacent owner of the suit schedule property and it is he who is running the stone crusher and this also falsifies the defence of the defendants that plaintiff is running a stone crusher in the land situated adjacent to the suit schedule property and has caused loss to the defendants etc. DWs.3 and 4 are examined by defendants to prove that it is the plaintiff who is running the stone crusher. However, their cross-examination RFA NO.100334/2016 16 reveals that, absolutely there are no documents in the name of the plaintiff to show that he is running the stone crusher. On the other hand, the evidence of PW.5 prove the fact that it is he who is running the stone crusher and not the plaintiff.
24. Based on the oral and documentary evidence placed on record, the Trial Court has come to a correct conclusion that defendants have executed Ex.P1 as well as the endorsements at Exs.P2 and 3 and they have received in all a sum of `15,50,000/- agreeing to sell the suit schedule properties to the plaintiff after receiving the balance consideration of `1,75,000/-. The Trial Court has rightly observed that even though right from the time when Ex.P1 was executed, defendants have availed loan from the bank and inspite of stating that the advance amount will be utilized for repaying the loan, they have not done so.
25. Taking into consideration all these aspects, ultimately the Trial Court has decreed the suit. It has directed the defendants to execute sale deed by receiving balance consideration of `1,75,000/- and after repaying the loan which is taken creating charge over the suit schedule property. In RFA NO.100334/2016 17 the event of defendants failing to clear the loan, the Trial Court has directed plaintiff to repay the same and that he is at liberty to recover it from the defendants. The conclusions arrived at by the trial Court is based on the oral and documentary evidence placed on record and we find no perversity to call for interference by this Court.
26. In this regard, the learned counsel representing the appellants/defendants has relied upon the decision in R.S.A.No.753/2006 (SP) dated 19.11.2012, wherein plaintiff's suit for specific performance was dismissed by the trial Court and the said judgment was confirmed in the Regular Appeal, whereby the suit of the plaintiff for specific performance came to be dismissed and the alternative prayer for repayment of compensation or atleast refund of advance amount was rejected. The second appeal in question was admitted on the following substantial question of law.
"In view of the finding recorded by the trial Court that the deceased defendant was a signatory to the agreement of sale and in the wake of the evidence of the witnesses PWs.1 to 4, whether the courts below were justified in negativing the alternative prayer made for RFA NO.100334/2016 18 payment for payment of compensation or atleast for refund of the advance amount paid?"
27. In the second appeal, it was held that even though in the absence of prayer for refund of earnest money, the said relief cannot be granted, however, the plaintiff is at liberty to initiate separate proceedings for any other relief that is permissible under law. Since in the present appeal, the decree granted by the trial Court is confirmed, there is no question of considering alternative relief and as such, the above decision is not applicable to the case on hand.
28. On the other hand, the learned counsel for the respondent/plaintiff has relied upon the decision in the matter of Ferrodous Estates (Pvt.) Ltd., Vs. P.Gopirathnam (Dead) and others reported in AIR 2020 SC 5041, wherein it is held that, mere escalation of land prices after the date of filing of the suit cannot be a sole ground to deny specific performance. Of course, in the present case, the trial Court has decreed the suit and we find that there is no perversity calling for interference and consequently, this decision lend support to the plaintiff's case.
RFA NO.100334/201619
Based on the above discussion, we hold that there is no merit in the appeal and consequently, it is dismissed.
Sd/-
JUDGE Sd/-
JUDGE Rsh / gab