970-J-FA-943-16 1/11
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH, NAGPUR.
FIRST APPEAL NO.943 OF 2016
1. Pramod s/o Anand Jaiswal
aged about 60 years, Occ. Business,
R.o Kamal Palace, Ramdaspeth,
Nagpur
2. Ramesh s/o Vitthalrao Dekondwar
aged about 65 years, Occ. Retired,
R/o Petkar Galli, Mahal Nagpur.
3. Rekha w/o Ramesh Burewar
aged about 50 years. Occ. Household,
R/o New Nandanwan, Nagpur. ... Appellants.
-vs-
Meenatai w/o Haribhau Manchalwar
aged about 42 years, Occ. Household,
R/o 596, Vaishnavi Niwas, Nawabpura,
Zenda Chowk, Mahal, Nagpur. ... Respondent
Shri R. M. Bhangde, Advocate for appellants.
Respondent served.
CORAM : A.S.CHANDURKAR, J.
DATE : March 03, 2017 Oral Judgment :
Notice for final disposal of the appeal was issued on 02/09/2016. Admit.
On 03/02/2017 as the respondent did not appear in the proceedings, the hearing was adjourned to 17/02/2017. On said date as ::: Uploaded on - 10/08/2017 ::: Downloaded on - 27/08/2017 18:42:02 ::: 970-J-FA-943-16 2/11 well as on 24/02/2017 there was no appearance on behalf of the respondent.
2. The appellants who are the original plaintiffs in Spl.C.S No.491/2012 are aggrieved by the judgment of the trial Court to the extent the trial Court has refused to pass a decree for specific performance of agreement dated 10/05/2011 by its judgment dated 27/04/2016. The trial Court instead directed refund of the earnest amount with interest.
Brief facts necessary for adjudicating the appeal are that the respondent-defendant is the owner of house property situated at plot No.31 and 1. On 10/05/2011 the defendant entered into an agreement to sell the aforesaid property to the plaintiffs for consideration of Rs.1,20,00,000/-. Earnest amount of Rs.76,00,000/- was paid to the defendant. The balance consideration was to be paid within period of eleven months at which time the sale deed was to be registered. On 11/06/2012 the plaintiffs issued a notice to the defendant calling upon her to accept the balance consideration and execute the sale deed. By reply dated 21/06/2012 the defendant denied execution of the agreement dated 10/05/2011. In this backdrop, a suit for specific performance came to be filed on 01/08/2012.
3. The defendant filed her written statement at Exhibit-15 and opposed the prayers in the suit. The agreement in question was denied and it was further stated that possession of the suit property was also not handed ::: Uploaded on - 10/08/2017 ::: Downloaded on - 27/08/2017 18:42:02 ::: 970-J-FA-943-16 3/11 over to the plaintiffs.
The plaintiffs examined two witnesses who were not cross- examined. The defendant did not lead any evidence. The trial Court held that the agreement dated 10/05/2011 had been duly proved, earnest amount of Rs.76,00,000/- was paid to the defendant and possession of the suit property was also handed over to the plaintiffs. However as the agreement at Exhibit-32 was not duly registered and as it was stated therein that possession of the suit property had been handed over to the plaintiffs, the trial Court held that on the basis of such unregistered agreement, the plaintiffs were not entitled for the relief of specific performance. Instead it directed refund of amount of Rs.76,00,000/- with 6% interest in said amount. The plaintiffs being aggrieved by the aforesaid judgment have challenged the same in the present appeal.
4. Shri R. M. Bhangde, learned counsel for the appellants submitted that the trial Court committed an error in refusing to grant a decree for specific performance only on the ground that the agreement at Exhibit-32 was not a registered document. He submitted that registration of such agreement was not mandatory and as per provisions of Section 17(1-A) of the Registration Act, 1908 (for short, the Act of 1908), registration of a document consisting a contract to transfer any immovable properly is required to be registered only for the purposes of provisions of Section 53-A ::: Uploaded on - 10/08/2017 ::: Downloaded on - 27/08/2017 18:42:02 ::: 970-J-FA-943-16 4/11 of the Transfer of Property Act, 1882 (for short, the Act of 1882). Referring to the provisions of Section 49 of the Act of 1908 it was submitted that the aforesaid agreement could be taken into consideration as evidence of a contract in a suit for specific performance. It was urged that the trial Court took into consideration the law with regard to the requirement of payment of stamp duty which was not a relevant consideration in the facts of the present case. It was pointed out that in the suit there was a specific prayer made calling upon the defendant to deliver physical possession of the suit property to the plaintiffs. In that regard learned counsel placed reliance upon the judgment of Honourable Supreme Court in S. Kaladevi vs. V. R. Somasundaram and ors. 2010(5) SCC 401, judgment of the Punjab and Haryana High Court in RSA No.4946/2011 decided on 11/09/2013 (Ram Kishan and anr. vs. Bijender Mann), order of Honourable Supreme Court dated 05/12/2013 in SLP No.35537/2013 in Ram Kishan and anr. vs. Bijender Mann and judgment of this Court in Gulam Murtuza Khan vs. Ramdas Banaji Ilame and ors. 2016 (2) Mh.L.J. 300.
It was then submitted that the plaintiffs had examined two witnesses but they were not cross-examined by the defendant. The defendant also did not lead any evidence. Though the trial Court did not decide the issue with regard to readiness and willingness on the part of the plaintiffs to perform their part of the contract, the evidence on record was sufficient to consider said issue by this Court. It was submitted that for said ::: Uploaded on - 10/08/2017 ::: Downloaded on - 27/08/2017 18:42:02 ::: 970-J-FA-943-16 5/11 purpose it was not necessary to remand the proceedings to the trial Court for recording a finding on said issue inasmuch as the defendant had not chosen to challenge the findings recorded by the trial Court against her. It was pointed out that the balance of consideration payable was Rs.44,00,000/- and this Court by order dated 02/09/2016 had directed the plaintiffs to deposit an amount of Rs.50,00,000/- in this Court. Said amount was accordingly deposited on 06/10/2016. It was therefore submitted that said issue needs to be answered in favour of the plaintiffs. Reliance was placed on the decision of the Honourable Supreme Court in Rajinder Sharma vs. Arpana Sharma (2011)15 SCC 300, judgment of learned Single Judge in Shubhangi Nandakishor Gaidhani and ors. vs. Damodar Govind Gaidhani and ors. 2012 (2) Mh.L.J. 170 and Mahadeo s/o Damduji Satawne vs. Nagpur Improvement Trust and ors. 2015 (6) ALL MR 99 for urging that in view of the nature of evidence on record it was not necessary to remand the proceedings. It was thus prayed that the decree for specific performance be passed.
5. As noted above, the defendant has not chosen to contest the appeal despite grant of sufficient opportunity. I have perused the records of the case and I have given due consideration to the submissions made on behalf of the plaintiffs. The following points arise for determination :
(i) Whether non-registration of the agreement dated 10/05/2011 dis- ::: Uploaded on - 10/08/2017 ::: Downloaded on - 27/08/2017 18:42:02 :::
970-J-FA-943-16 6/11 entitles the plaintiffs to the relief of specific performance ?
(ii) If the answer to point No.1 is in the negative, whether it is necessary to remand the proceedings to enable the trial Court to consider the evidence on the question of readiness and willingness of the plaintiffs ?
(iii) Is the answer to point No.2 is in the negative, whether the plaintiffs have proved that they were always ready and willing to perform their part of contract ?
(iv) What order ? 6. As to Point No.(i) :
The plaintiffs examined plaintiff No.2 at Exhibit-30 to prove the agreement dated 10/05/2011 at Exhibit-32, public notice dated 07/06/2012 at Exhibit-35 and 37, legal notice dated 11/06/2012 at Exhibit-40 and the reply issued by the defendant at Exhibit-41. This witness was not cross- examined by the defendant. The plaintiffs then examined a witness to the agreement dated 10/05/2011 at Exhibit-46. This witness was also not cross- examined.
After considering the aforesaid evidence, the trial Court in paragraphs 9 and 10 recorded a finding that the agreement dated 10/05/2011 was duly proved and that earnest amount of Rs.76,00,000/- had been paid by the plaintiffs to the defendant. These findings have remained unchallenged at the instance of the defendant. The provisions of Section ::: Uploaded on - 10/08/2017 ::: Downloaded on - 27/08/2017 18:42:02 ::: 970-J-FA-943-16 7/11 17(1-A) of the Act of 1908 require registration of a document containing a contract to transfer for consideration any immovable property for the purposes of Section 53-A of the Act of 1882. The consequence of such non- registration is that said document if not registered would have no effect for the purposes of Section 53-A of the Act of 1882. Thus there is no statutory requirement to have such document registered if the party concerned does not seek to have benefit of the provisions of Section 53-A of the Act of 1882.
7. In the present case the agreement at Exhibit-32 stipulates that the defendant had handed over possession of the suit property to the plaintiffs. However in the plaint it has been pleaded that the defendant took back forcible possession of the suit property and hence the plaintiffs prayed for a direction against the defendant to deliver possession of the suit property in their favour. It is therefore clear that the plaintiffs have not sought any relief by relying upon the provisions of Section 53-A of the Act of 1882. Hence non-registration of the agreement dated 10/05/2011 is not a factor which could affect the entitlement of the plaintiffs to the relief of specific performance. In S. Kaladevi (supra) the Honourable Supreme Court considered the provisions of Section 49 and Section 17 of the Act of 1908. It was held that an unregistered document could be used as evidence for co- lateral purposes as provided in proviso to Section 49 of the Act of 1908. It further held that a document that was required to be registered but was ::: Uploaded on - 10/08/2017 ::: Downloaded on - 27/08/2017 18:42:02 ::: 970-J-FA-943-16 8/11 unregistered could be admitted in evidence as evidence of a contract in a suit for specific performance. On the basis of aforesaid decision, it was held in Gulam Murtuza Khan (supra) that in suit for specific performance of an unregistered agreement of sale such document could be received as evidence for co-lateral purposes. In said decision a reference was made to the judgment of the Division Bench of the Punjab and Haryana High Court in Ram Kishan and anr. vs. Bijender Mann and ors 2013(2) Civ CC 188 wherein a similar view was taken. This decision of the said High Court was challenged before the Honourable Supreme Court and the Special Leave Petition came to be dismissed on 05/12/2013. Thus from the aforesaid it can be seen that even if the agreement dated 10/05/2011 required registration but was not registered, it could be taken into consideration for co-lateral purposes which would indicate an agreement for sale of the suit property.
The trial Court committed an error by treating the said document as conveyance and on that basis refused the relief of specific performance. The trial Court was not justified in relying upon the decision of the Honourable Supreme Court in Veena Husmukh Jain and anr. vs. State of Maharashtra and ors. 1999(5) SCC 725 especially when the plaintiffs were also seeking possession of the suit property. Hence point No.(i) is answered by holding that non-registration of the agreement dated 10/05/2011 would not dis-entitle the plaintiffs to seek the relief of specific performance. ::: Uploaded on - 10/08/2017 ::: Downloaded on - 27/08/2017 18:42:02 :::
970-J-FA-943-16 9/11
8. As to Point Nos.(ii) and (iii) :
As the plaintiffs have been held entitled to seek the relief of specific performance on the basis of agreement dated 10/05/2011 it would be necessary to consider whether the proceedings deserve to be remanded to the trial Court to record a finding on the readiness and willingness of the plaintiffs to perform their part of the agreement. As noted above, the plaintiffs examined plaintiff No.2 as well as an attesting witness to the aforesaid agreement. Plaintiff No.2 has specifically deposed that the plaintiffs were always ready and willing to perform their part of the agreement. These witnesses were not cross-examined by the defendant nor did the defendant enter the witness box. Considering the fact that the witnesses examined by the plaintiff have not been cross-examined and no evidence had been led by the defendants, I do not find it necessary to again remand the proceedings to the trial Court for recording a finding as to the readiness and willingness of the plaintiffs. The evidence in that regard is already on record which is for the reasons best known to the defendant is not challenged. The payment of earnest amount of Rs.76,00,000/- by the plaintiffs to the defendant has been duly proved. By order dated 02/09/2016 the plaintiffs were directed to deposit an amount of Rs.50,00,000/- in this Court to show their bonafides. This amount has been accordingly deposited. Thus out of the total amount of consideration of Rs.1,20,00,000/- an amount of Rs.76,00,000/- has been paid by the plaintiffs ::: Uploaded on - 10/08/2017 ::: Downloaded on - 27/08/2017 18:42:02 ::: 970-J-FA-943-16 10/11 as earnest money and Rs.50,00,000/- have been deposited by them in this Court. In effect, the plaintiffs have parted with an amount of Rs.1,26,00,000/-. As per agreement dated 10/05/2011, the entire consideration was to be paid within a period of eleven months. On 11/06/2012 the plaintiffs had issued a notice to the defendant as per Exhibit- 40 and called upon her to accept the balance consideration. Immediately thereafter on 01/08/2012 the suit came to be filed. Thus on the basis of the evidence led by the plaintiffs before the trial Court and a deposit of balance consideration in this Court, I am satisfied that the plaintiffs have proved that they were and are ready and willing to perform their part of the agreement.
9. As held by the Honourable Supreme Court in Rajinder Sharma (supra) if the entire evidence on the basis of which the relief of specific performance is sought is available on record, the High Court as a Court of fact and law can consider said evidence so as to obviate the avoidable remand of the proceedings. It would have been a different matter if the defendant would have challenged the findings recorded by the trial Court by contesting the proceedings. Hence on that basis point Nos.(ii) and (iii) are answered by holding that it is not necessary to remand the proceedings to the trial Court and that the plaintiffs have proved their readiness and willingness as per provisions of Section 16(c) of the Specific Relief Act, 1963. ::: Uploaded on - 10/08/2017 ::: Downloaded on - 27/08/2017 18:42:02 :::
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10. In view of aforesaid findings, the judgment of the trial Court cannot be sustained. The trial Court misdirected itself when it held that as the agreement dated 10/05/2011 was unregistered it could not be looked into for considering the prayer for grant of relief of specific performance. Hence said judgment is liable to be set aside. Accordingly the following order is passed :
(I) The judgment dated 27/04/2016 in Spl. C.S. No.491/2012 is quashed and set aside. Instead it is held that the plaintiffs are entitled for a decree of specific performance of agreement dated 10/05/2011.
(II) The amount of Rs.44,00,000/- out of the amount of Rs.50,00,000/- deposited by the plaintiffs shall be paid to the defendant. On receipt of aforesaid amount, the defendant shall execute the sale deed of the suit property in favour of the plaintiffs within period of three months. On failure on the part of the defendant to execute sale deed, the plaintiffs shall have the same executed through Court. Balance amount of Rs.6,00,000/- with accrued interest shall be refunded to the plaintiffs. (III) The defendant shall also hand over possession of the suit property to the plaintiffs on execution of such sale deed. Decree is passed accordingly.
(IV) First appeal is allowed in aforesaid terms with no order as to costs.
JUDGE Asmita ::: Uploaded on - 10/08/2017 ::: Downloaded on - 27/08/2017 18:42:02 :::