Gurvinder Kaur vs Sohan Singh

Rakesh Garg, J.—Respondent No. 1 filed the instant suit for possession of the suit land by way of specific performance of an agreement to sell dated 10.6.2005 against the appellant as well as other respondents stating that defendant No. 1/respondent No. 2 entered into an agreement to sell dated 10.6.2005 with him for sale of suit land measuring 15 kanals 12 marlas @ Rs. 5 lacs per acre and received a sum of Rs. 1 lac as earnest money. The date for registration of the sale deed was fixed as 30.11.2005. Plaintiff-respondent No. 1 remained present in the office of the Sub Registrar along with remaining sale consideration as well as other expenses. Thereafter, the plaintiff-respondent No. 1 served a legal notice dated 14.3.2006 upon defendant No. 1/respondent No. 2 and called upon him to execute and register the sale deed in his favour on 17.4.2006. However, on 17.4.2006, defendant No. 1/respondent No. 2 did not turn up for execution of the sale deed. It is the further case of plaintiff-respondent No. 1 that defendant No. 1/respondent No. 2 transferred the suit land vide two sale deeds dated 25.5.2006 and 26.5.2006 in favour of the appellant and defendant/respondents No. 3 and 4 which were illegal having no effect on the rights of plaintiff-respondent No. 1 and thus, necessity arose to file the instant suit.

Upon notice, appellant as well as defendant No. 1/respondent No. 2 appeared whereas defendant/respondents No. 3 and 4 did not appear and were proceeded against ex parte vide order dated 23.5.2007. Defendant No. 1/respondent No. 2 filed written statement raising various preliminary objections, further stating that he was in need of money for domestic purposes and thus, he borrowed a sum of Rs. 1 lac from plaintiff-respondent No. 1 who asked him to execute an agreement/security deed of his land in his favour and thus, he received a sum of Rs. 1 lac from the plaintiff-respondent and as a security of which the plaintiff got a security deed/agreement in his favour in respect of suit land assuring him to return the said agreement/security deed on return of the borrowed amount. Since respondent No. 2 could not manage the repayment of the borrowed amount, he sold the suit land vide sale deeds dated 25.5.2006 and 26.5.2006 and made the payment of Rs. 1 lac as principal amount and Rs. 20,000/- as interest to the plaintiff-respondent No. 1 from the sale proceeds received by him. It is also the case of respondent No. 2 that the plaintiff gave a receipt dated 25.05.2006 to him in respect of the amount of Rs. 1,20,000/- wherein it was also mentioned that the agreement for sale of land has been cancelled and in future he will not make any claim against him on the basis of said agreement dated 10.06.2005. It is the further case of defendant No. 1/respondent No. 2 that on payment of the borrowed amount to plaintiff-respondent No. 1, he demanded his security deed/agreement. However, he refused to return the same. All other pleas were denied and dismissal of the suit was prayed.

The appellant filed a separate written statement raising various preliminary objections. On merits, it was stated that the appellant was a bona fide purchaser with valuable consideration and without any notice of the alleged agreement to sell in favour of plaintiff-respondent no. 1 and as such the suit was not maintainable against her. It was the further case of the appellant that she had inspected the revenue record before purchasing the suit land and nothing was found mentioned in the revenue record about the alleged agreement to sell and thus, the said agreement cannot be enforced against her. It was further submitted that respondent No. 2 never executed the alleged agreement in favour of respondent No. 1. It was further submitted that plaintiff-respondent No. 1 never raised an objection on 25.05.2006 at the time of registration of sale deed in her favour inspite of the fact that respondent No. 1 was present. Other contentions were denied and request for dismissal of the suit was made.

No replication has been filed.

On the pleadings of the parties, the following issues were framed:-

Whether the plaintiff is entitled to a decree for possession by way of specific performance regarding agreement to sell dated 10.06.2005 ?OPP

Whether the registered sale deed no. 791 dated 25.05.2006 executed by defendant no. 1 in favour of defendant no. 2 regarding the suit land measuring 12 kanal 01 marla and registered sale deed no. 826 dated 26.05.2006 regarding suit land measuring 03 kanal 12 marla executed in favour of defendants no. 3 to 4, are illegal, wrong, without consideration, against agreement to sell dated 10.06.2005 and are null and void and are liable to be set aside ?OPP

Whether the defendants no. 2 to 4 are liable to be restrained from alienating the suit land to any other person ?OPP

Whether the plaintiff has no locus standi to file the present suit ?OPD

Whether the plaintiff has no cause of action to file the present suit ?OPD

Whether the plaintiff has not come to the Court with clean hands ?OPD

Whether the suit of the plaintiff is not maintainable ?OPD

Whether is plaintiff is estopped by his own act and conduct from filing the present suit ?OPD

Relief.

After hearing counsel for the parties and considering the evidence on record, the trial Court decided issues no. 1 to 3 in favour of plaintiff-respondent No. 1 holding that an agreement to sell was executed by respondent No. 2. However, respondent No. 1 was not entitled to specific performance of the agreement to sell in question as defendants No. 2 to 4 (i.e. Appellant as well as respondents No. 3 & 4) were bona fide purchasers with consideration and without any notice of agreement to sell in favour of respondent No. 1. Issues No. 4 to 8 were not pressed. Consequently, the suit was decreed for recovery of Rs. 1,00,000/- along with the interest against respondent No. 2.

Aggrieved from the aforesaid judgment and decree of the trial Court dated 26.11.2009, the plaintiff-respondent No. 1 filed an appeal before the Lower Appellate Court.

The defendants never challenged the said judgment and decree of the trial Court.

The Lower Appellate Court after considering the submissions made, vide judgment and decree dated 11.02.2013 accepted the appeal filed on behalf of the plaintiff-respondent No. 1 observing that the appellant as well as defendant-respondents No. 3 & 4 were not bona fide purchasers and therefore, the sale deeds dated 25.05.2006 and 26.06.2006 were null and void and were liable to be set aside. Thus, the judgment and decree of the trial Court was modified and the suit was decreed in toto holding that the plaintiff-respondent No. 1 was entitled to specific performance of the agreement to sell in question.

Aggrieved from the judgment and decree of the Lower Appellate Court, the appellant, who was defendant No. 2 before the trial Court, has filed the instant appeal submitting that the following substantial questions of law arise in this appeal:-

a. Whether the impugned judgment and decree of the First Appellant court is based on misreading of the evidence on record and therefore is bad in law?

b. Whether the First Appellate court has illegally ignored the evidence on record and thereby reversed the finding of the Trial Court that the Appellant had no prior notice of the alleged agreement to sell between the Plaintiff and the Defendant No. 1?

c. Whether the First Appellate court could reverse the Judgment and Decree passed by the trial court without there being any evidence to the contrary?

d. Whether the First Appellate court has erroneously concluded that the Appellant was well aware of the agreement to sell between the Plaintiff and Defendant No. 1 without there being any evidence to this extent?

Learned counsel for the appellant has vehemently argued that the Lower Appellate Court has misread and misconstrued the evidence on record and has gone wrong in discarding the plea of the appellant that she was the bona fide purchaser with valuable consideration and without any notice of the alleged agreement to sell in favour of plaintiff-respondent No. 1 and hence, the suit was not maintainable against her. It is the further case of the appellant that she had taken all precautions and had also inspected the revenue record before purchasing the suit land and had not found any mention in the revenue record about the agreement of sale and hence, the said agreement cannot be enforced against her. Moreover, the plaintiff-respondent No. 1 was present at the time of execution and registration of the sale deed in her favour and had not raised any objection in this regard and therefore, he was estopped from raising such an issue in the civil suit and thus, the substantial questions of law, as raised, do arise in this appeal and the judgment and decree of the Lower Appellate Court is liable to be set aside.

I have heard learned counsel for the appellant and perused the impugned judgment and decree of Lower Appellate Court as well as of the trial Court.

In this appeal, execution of agreement to sell (Ex. P-1) is not disputed. In fact, even defendant No. 1/respondent No. 2 has not disputed the execution of the agreement to sell in question but has taken the plea that it was executed as security to the loan amount and on repayment of the said amount he was entitled to the return of the said original agreement to sell which stood cancelled. However, the aforesaid plea taken on behalf of the defendant No. 1/respondent No. 2 could not be substantiated before the Courts below.

As notice above, the judgment of the trial Court holding that the execution of the document in question stood proved has not been challenged by any of the defendants by filing an appeal before the Lower Appellate Court and therefore, the aforesaid finding has already become final against the defendants including the appellant.

The only question before the Lower Appellate Court in the appeal filed on behalf of plaintiff-respondent No. 1 was to the extent as to whether plaintiff-respondent No. 1 was entitled to specific performance of the agreement to sell in question. In this case, respondent No. 2 had already sold the suit property in favour of appellant as well as respondents No. 3 & 4 vide sale deeds dated 25.05.2006 and 26.05.2006. Defending the judgment of the trial Court, the appellant claimed to be a bona fide purchaser with consideration without previous notice of the sale in favour of plaintiff-respondent No. 1. However, after considering the evidence on record, while reversing the finding of the trial Court on the aforesaid question, the Lower Appellate Court held that the appellant was in the knowledge of agreement to sell in question executed in favour of plaintiff-respondent No. 1 and thus, she cannot be held to be a bona fide purchaser without notice. For recording the aforesaid finding, the Lower Appellate Court has referred to cross-examination of DW-3 Narender Kaur, wherein it had been admitted that appellant is the daughter-in-law of defendant No. 1/respondent No. 2. Since the appellant is closely related to defendant No. 1/respondent No. 2, it is highly improbable that she was unaware of the agreement to sell in question in favour of the plaintiff-respondent No. 1 and in view thereof, no exception can be taken to the findings of the Lower Appellate Court that the appellant was not a bona fide purchaser of the suit property as she had the knowledge about the agreement to sell in favour of plaintiff-respondent No. 1 and the sale deeds were executed in her favour and that of defendant/respondent No. 3 and 4 by defendant No. 1/respondent No. 2 to defeat the rights of the plaintiff-respondent No. 1 under the agreement.

In view of the aforesaid, this appeal is dismissed with costs which are assessed at Rs. 20,000/-.

The costs be deposited with the High Court Legal Services Committee within one month from today.

For the reasons mentioned in the application, which is supported by an affidavit, order dated 20.05.2014 is recalled and the appeal is restored to its original number.

CM stands disposed of.

With the consent of the counsel for the appellant, appeal is taken on Board and heard on merits.