K. Nagarajaiah and Others vs K.R. Devi Sulochana

Aravind Kumar, J.—This is defendants second appeal challenging the judgment and decree passed by Fast Track and District and Sessions Court, Anekal, Bangalore Rural District in R.A. No. 1/2011 dated 31.08.2012 dismissing the appeal filed by defendants with costs and affirming the judgment and decree passed by the Civil Judge (Sr. Dn) and JMFC, Anekal dated 23.11.2010 in O.S. No. 1213/2006 (old No. 1636/2005) whereunder suit filed by the plaintiff for specific performance and directing defendants-1 and 2 to execute the registered sale deed in favour of plaintiff by receiving balance sale consideration amount of Rs. 4,25,000/- within a period of two months from the date of judgment had been decreed.

Appeal has been admitted on 05.02.2014 to consider the following substantial question of law:

(1) When admittedly the parties have agreed to complete the transaction within six months under Ex. P-9, the inaction on the part of plaintiff in securing the sale deed within the time stipulated would entitle her to seek the relief of specific performance contending that she was ready and willing throughout to complete her part of the agreement?

When the matter was heard on 26.09.2015, the learned Advocates had submitted that additional substantial question of law may be formulated insofar as Ex. P-9 is concerned. Hence, after hearing the arguments, following additional substantial question of law came to be formulated:

"Whether the Courts below were justified in arriving at a conclusion that the parties were at ad idem when they entered into agreement of sale dated 03.07.2003 - Ex. P-9?"

I have heard the arguments of Sri M.S. Varadarajan learned Advocate appearing for appellants-defendants and Sri B. Vijay Shetty, appearing for respondent-plaintiff.

It is the contention of Mr. Varadarajan, learned Advocate appearing for appellants - defendants that Courts below erred in not appreciating the evidence in proper perspective inasmuch as, it has been concluded that on account of execution of agreement of sale - Ex. P-9 being admitted by the defendants it was sufficient to decree the suit, though evidence on record would indicate that plaintiff had inserted certain clauses in the agreement of sale to suit her convenience and taking advantage of she being in a domineering position, she had incorporated the clauses in said agreement - Ex. P-9 to suit her convenience. He would elaborate his submission by contending that a bare reading of agreement of sale dated 03.07.2003 - Ex. P-9 would indicate that plaintiff had accepted the title of defendants and there was no other document which was required to be furnished by defendants to the plaintiff so as to enable them to obtain registration of sale deed and plaintiff in order to ensure that agreement is kept subsisting as long as possible, had used certain clauses in the agreement to the disadvantage of defendants and said clauses even otherwise does not indicate that furnishing of those documents was required or essential for getting a sale deed registered. He would also submit that phodi or furnishing of survey records was never in contemplation at the time of execution of the agreement so as to conclude the contract and by insertion of said clause, it has given an unfair advantage in favour of the plaintiff and as such, Courts were not justified in exercising the discretionary power vested in favour of the plaintiff and contends that same ought to have been refused.

He would further contend that defendants at the time of execution of subject agreement - Ex. P-9 was in need of funds to meet the marriage expenses of his daughter, as such, he was perforced to approach the plaintiff for financial assistance and this aspect had been lost sight of by both the Courts. He would also submit that plaintiff had agreed to pay entire sale consideration and get the sale deed registered in her favour and on account of plaintiff not being ready and willing and she having not adhered to the terms agreed to under Ex. P-9, first defendant was perforced to approach his mother-in-law to sell her property in order to meet the marriage expenses of his daughter and as such, he contends that parties were not at ad idem when Ex. P-9 was entered into or in other words, defendants never agreed to sell the suit schedule property.

He would also contend that all the original documents had already been handed over to plaintiff and nothing remained for the defendants to perform. He would contend that even if it is accepted that defendants had received further sum of Rs. 1,00,000/- on 19.01.2004, it was indicated in the endorsement that within six months plaintiff had to get the sale deed registered and same having not been done by plaintiff, she was not entitled for grant of discretionary relief. He would submit that in view of endorsement dated 19.01.2004 parties had agreed that time was the essence of contract.

In support of his submissions, he has relied upon the judgment of the Hon''ble Apex Court in Shamsher Singh and Others Vs. Rajinder Kumar and Others, .

Per contra, Sri Vijay Shetty, learned Advocate appearing for respondent-plaintiff would support the judgment and decree passed by both the Courts and contends that time was never agreed to be the essence of contract and the very fact that defendants had received further advances subsequent to execution of Ex. P-9 on 06.01.2004 and on 19.01.2004 would itself indicate that parties to the agreement had never agreed that time would be the essence of contract. Hence, he prays for rejection of the said contention.

He would also submit that defendants had with open eyes entered into contract on 03.07.2003 - Ex. P-9 and first defendant being an educated person and being conversant with Kannada language had affixed his signature to Ex. P-9 and he cannot contend contrary to what is agreed to under the said document. He would also contend that second defendant being wife of first defendant had also affixed her signature to the subject agreement - Ex. P-9 which is not disputed and so also the daughter as a witness and none of them having entered the witness box, defendants cannot contend contrary to the terms agreed to under the agreement-Ex. P-9. Hence, he submits that contention raised by defendants that time was essence of the contract is contrary to recitals found in the document and also endorsements made by defendants in the subject agreement.

He would further contend that on account of first defendant having acquired title to suit schedule property by virtue of a compromise decree entered into between himself and his brothers, he was required to furnish not only copy of the decree, but also the survey sketch to enable the plaintiff to get registration and as such, it was agreed to between parties that defendants were required to furnish phodi documents and to overcome inaction on their part in not furnishing the said documents, plea of the parties being not in contemplation on this issue is being raised and he prays for rejecting the same.

On these grounds, he seeks for answering substantial questions of law in favour of respondents-plaintiffs.

Having heard the learned Advocates appearing for parties and on perusal of judgment and decrees passed by the Courts below as also the records secured from respective Courts and after bestowing my careful and anxious consideration to the arguments advanced at the Bar, substantial questions of law are being answered after narrating the facts which has led to filing of second appeal.

FACTUAL MATRIX:

Plaintiff filed a suit for specific performance contending inter alia that defendants had entered into an agreement of sale on 03.07.2003 agreeing to sell the property bearing Sy. No. 155/7, Hulimangala village, Jigani Hobli, Anekal Taluk, Bangalore District measuring 2 acres (hereinafter referred to as ''suit schedule property''); it was contended that said property is owned by defendant No. 1 by virtue of he having acquired title to same under a registered partition deed dated 19.03.2001 and on the basis of Court decree, etc.; it was further contended that defendants agreed to sell suit schedule property for a total consideration of Rs. 8,25,000/- since they were in need of money to maintain the family and as such, agreement was entered into on 03.07.2003 which document was marked as Ex. P-9 and a sum of Rs. 1,00,000/- was paid by plaintiff to the defendants as advance on the date of execution of agreement; it was also contended that defendants had agreed to receive further sum of Rs. 3,00,000/- within two months from the date of execution of agreement and after obtaining phodi work of the suit schedule property and it was further agreed that balance of Rs. 4,25,000/- would be paid within six months from the date of completion of two months of receipt of second advance and after mobilizing all the requisite documents for registration purposes; plaintiff also stated that original title deeds dated 14.10.1960 and 25.02.1988 were handed over by first defendant to plaintiff; plaintiff further contended that on 06.01.2004 defendants received further sum of Rs. 2,00,000/- and a sum of Rs. 1,00,000/- on 19.01.2004 by executing necessary shara - endorsement and had agreed that they would execute the sale deed within six months after getting the appropriate documents and though they received the said documents, they did not execute the sale deed as agreed to under the second endorsement and plaintiff has always ready and willing to perform her part of the contract but defendants were willfully avoiding execution of the sale deed in favour of plaintiff; hence, plaintiff sought for a judgment and decree to direct the defendants-1 and 2 to execute sale deed in their favour relating to suit schedule property by receiving balance sale consideration of Rs. 4,25,000/-.

Defendants on service of suit summons appeared, filed written statement, admitted execution of agreement of sale dated 03.07.2003 as partly true. However, it was contended that defendants had not agreed to the terms and conditions referred to in the agreement of sale and they further pleaded that signatures of defendants were obtained by misrepresenting the facts. The contents of the endorsements made in Ex. P-9 on 06.01.2004 and 19.01.2004 and its contents thereof came to be denied. Defendants in their detailed written statement denied the averments made in the plaint except to the extent of express admission made therein.

Trial Court after considering the pleadings of the parties, formulated issues for its consideration and after evaluating the material evidence available on record, decreed the suit by judgment and decree dated 21.11.2010. First appellate Court on re-appreciation of entire evidence and after considering the contentions raised by respective learned Advocates appearing for the parties, dismissed the appeal and affirmed the judgment and decree passed by the trial Court.

RE: SUBSTANTIAL QUESTION OF LAW No. (1) (FORMULATED ON 5.02.2014)

The agreement of sale dated 03.07.2003-Ex. P-9 which is the bone of contention between parties is undisputedly entered into between plaintiff and defendants. Defendants in their written statement at paragraphs 4 and 5 have expressly admitted execution of the said agreement. The signatures found in the said document which came to be confronted to D.W. 1 i.e., first defendant is also admitted. His admission in the cross examination dated 09.09.2010 reads as under:

In the very same cross examination, it is also admitted by D.W. 1 that his wife has also affixed her signature and the said agreement and same had been entered into between them as per their wish. The admission reads as under:

The signatures of defendants found on Ex. P-9 has been identified by him and as such, in the cross examination dated 09.09.2010 it came to be marked as Ex. P-9(a) to P-9(c). D.W. 1 has also admitted the signatures found in the shara-endorsement dated 06.01.2004 and 19.01.2004 as same being the signatures of defendants and as such, they came to be marked as Ex. P-9(m), (n), (q) and (r). Defendants have also admitted the receipt of advance amount of Rs. 1,00,000/- on the date of execution of said agreement - Ex. P-9 and receipt of further advances on 06.01.2004 in a sum of Rs. 2,00,000/- and on 19.01.2004 a further sum of Rs. 1,00,000/-.

Abovesaid pleadings and evidence available on record would clearly indicate that defendants have entered into agreement of sale on 03.07.2003 and have received a sum of Rs. 1,00,000/- on the said date and additional advances have been received by them on 06.01.2004 and 19.01.2004 in a sum of Rs. 3,00,000/- and in all Rs. 4,00,000/-.

It has been contended that even if it is accepted that defendants had executed the shara on 06.01.2004 and on 19.01.2004, it does not absolve the plaintiffs liability to get the sale deed registered within six months from the date of execution of such endorsement-shara since it was agreed thereunder that times would be the essence of contract. Said argument requires to be considered with circumspection for reasons more than one. Firstly, in case of sale of an immovable property, time would not be the essence of contract, until and unless expressly agreed to and admitted by the parties. In the instant case, perusal of the subject agreement - Ex. P-9 would clearly indicate that defendants had agreed to procure or secure the records relating to Phodi work (survey work) and inform the plaintiffs of having secured the same to enable the plaintiffs to obtain registration of sale deed. It would be appropriate to extract term of the contract as found in Ex. P-9 so as to maintain clarity on this issue. It reads as under:

Above recital would indicate that defendants had agreed to sell suit schedule property to plaintiff for a total consideration of Rs. 8,25,000/- and they had received a sum of Rs. 1,00,000/- by advance and had agreed to receive a further sum of Rs. 3,00,000/- out of Rs. 7,25,000/- within two (2) months after obtaining phodi records.

The first endorsement or shara came to be executed by defendants on 06.01.2004 endorsing thereunder that they would require further time to secure documents and as such, they are receiving further amount of Rs. 2,00,000/-. They have also stated that balance amount of Rs. 5,25,000/- would be received after receipt of relevant records and they would inform plaintiffs within six months thereafter to get the registration done. Even in the subsequent endorsement made on 19.01.2014 same has been reiterated and while executing second shara or endorsement, defendants have received additional advance of Rs. 1,00,000/-. This itself would clearly indicate that parties were never under contemplation of time being the essence of the contract and if it were to be so, nothing prevented the defendants to refuse to execute shara on 06.01.2004 or on 19.01.2004. With their eyes wide open, they have executed the sharas and received further consideration as indicated hereinabove. Hence, it cannot be held that plaintiff and defendants had agreed to complete the transaction within the time frame and accordingly, substantial question of law is answered by holding that parties to Ex. P-9 had never agreed to complete the transaction within six months as pleaded by defendants and on account of shara or endorsements dated 06.01.2004 and 19.01.2004 having been executed by defendants.

At this juncture itself, it would be apt and appropriate to note that defendant No. 1 is an educated person, he has studied up to PUC - Pre University level. He knows how to read and write Kannada. At the time of execution of Ex. P-9, he was working as a Conductor in Bangalore Metropolitan Transport Corporation - BMTC and as such, he cannot be heard to contend that either he did not understand the contents of Ex. P-9 or they never intended to incorporate the clause relating to defendants'' furnishing Phodi records to plaintiff for getting the sale deed registered. In that view of the matter, contention raised by defendants in this regard is not susceptible to acceptance and stands rejected by answering substantial question of law against appellants and in favour of respondent - plaintiffs.

RE: SUBSTANTIAL QUESTION OF LAW FRAMED ON 26.09.2015.

Any amount of discussion on this question would be repetition of facts, inasmuch as, finding recorded by this Court on substantial question of law No. 1 would encompass this question also. However, certain additional facts are required to be narrated while answering this question of law.

Though defendants admitted of having entered into an agreement of sale on 03.07.2003 - Ex-P-9 with the plaintiff as already noted hereinabove, as could be seen from paragraphs 4 and 5 of the written statement filed by defendants, the contention put forward by defendants to stave off their obligation which was required to be performed by them under the agreement of sale Ex-P-9 by contending that defendants did not intend to sell entire suit schedule property but they were only contemplating of selling half an acre or one acre is without merit. Said plea reiterated by D.W. 1 in his evidence has remained as a plea without proof.

Though Mr. Varadarajan, learned Advocate appearing for appellants has contended that obligations which were required to be performed by defendants under Ex. P-9 had already been performed and nothing else remained to be performed by them cannot be accepted since the recitals in the document - Ex. P-9 would indicate that at more than one place, defendants have agreed to furnish Revenue records (Durasthi [Survey] records) to plaintiff so that plaintiff can take steps to get the sale-deed registered. Even when shara came to be made by the defendants in Ex. P-9 on 06.01.2004 and 19.01.2004, it was agreed by the defendants in Ex. P-9 that for want of obtaining certain records, sale-deed was not executed and they would require further time to procure it and execution of these endorsements has been admitted by D.W. 1 in his cross examination and same cannot be lost sight of by this Court. Further, the fact that defendants did not issue any notice informing the plaintiffs about there being no obligation on the part of defendants to furnish any documents or calling upon the plaintiff to get the sale deed registered is yet another factor which requires to be taken note of to reject the contention of the plaintiffs that there was no obligation which was required to be performed by the defendants though recitals in Ex. P-9 would indicate otherwise namely, defendants were under obligation to furnish the plaintiff with Phodi records (survey records). Undisputedly, no such notice was issued by defendants to the plaintiffs. In fact, D.W. 1 has admitted in his cross examination dated 30.09.2010 that he intended to purchase another agricultural property after selling suit schedule property. This impeccable evidence available on record would clearly indicate that parties namely, plaintiffs and defendants were at ad idem when they entered into an agreement of sale on 03.07.2003 as per Ex. P-9 and defendants had agreed to sell suit schedule property in favour of plaintiff.

The recitals found in Ex. P-9 and the evidence available on record does not even remotely suggest that clauses (a) to (c) found in sub-section (2) of Section 20 of the Specific Relief Act, 1963 are attracted to facts on hand so as to deny the relief of specific performance to plaintiff. Defendants having admitted execution of agreement Ex. P-9 and having set up a plea that in order to perform the marriage of his daughter, he had agreed to sell the suit schedule property same has remained a plea without proof and the plea of first defendant''s mother-in-law having sold her property on 07.02.2005 for the purpose of meeting marriage expenses of defendants daughter is also not proved so as to enable the defendants to contend that discretion exercised by trial Court to decree the suit which came to be affirmed by lower appellate Court is contrary to Section 20(2) of Specific Relief Act, 1963.

In that view of the matter, this Court is of the considered view that substantial question of law No. 2 is to be answered by arriving at a conclusion that Courts below were justified in arriving at a conclusion that parties were at ad idem when they entered into an agreement of sale dated 03.07.2003 - Ex. P-9.

The judgment of Apex Court in the matter of Shamsher Singh and Others Vs. Rajinder Kumar and Others, relied upon by learned Advocate appearing for appellants to contend that where terms of an agreement gives unfair advantage to plaintiff - purchaser is a ground to decline grant of discretionary relief has to be necessarily held that principles laid down therein would not come to the rescue of appellants in the instant case, inasmuch as, it was noticed by the Apex Court in the said judgment that trial Court had not granted the decree for specific performance but had passed a decree ordering the defendants to return Rs. 3,00,000/- with interest to plaintiffs on the ground that a balanced approach should be taken as plaintiffs should be protected and defendants 1 to 3 therein should not be disproportionately penalized. It was also noticed by Hon''ble Apex Court that trial Court had taken note of the important piece of material evidence available on record namely, a compromise entered into between parties in the suit as per Ex. P-8 which indicated that defendants therein had agreed to return the earnest money and said compromise contained the thumb impression of defendants which was not accepted by the appellate Court, as a factor to decline the exercise of discretionary relief by the trial Court being correct. It was also noticed by Hon''ble Apex Court that defendants therein had disputed the very execution of agreement of sale and contended that it was a mortgage deed in lieu of loan of Rs. 85,000/- they had obtained from the plaintiffs for their household expenses. However, facts obtained in the present case are entirely different. Firstly, defendants have admitted the execution of agreement of sale including their signatures found on the said document - Ex. P-9. Secondly, endorsements executed by them on subsequent dates i.e., on 06.01.2004 and 19.01.2004 is also admitted. Last but not the least, defendants are not denying the fact that defendants had acquired title to the suit schedule property pursuant to a judgment and decree passed on a compromise petition which was a dispute between first defendant and his uncles (father''s brothers) and it is obvious that for this reason defendants had agreed to furnish the Phodi documents to the plaintiff so that demarcation would be available and thereby any further litigation can be avoided. Hence, said judgment would not assist the appellants herein.

For the reasons stated above, I proceed to pass the following:

(i) Second appeal is hereby dismissed with costs.

(ii) Judgment and decree passed by Fast Track Court and District and Sessions Judge Court, Anekal, Bangalore Rural District in R.A. No. 1/2011 dated 31.08.2012 is hereby affirmed.

(iii) Costs quantified at Rs. 5,000/- is payable by appellants to respondent-plaintiff.

Registry to draw the decree accordingly and retransmit the records to jurisdictional Court.

In view of appeal having been dismissed, I.A.I/2012 for stay does not survive for consideration and accordingly, it is hereby dismissed.