THE HONOURABLE THE ACTING CHIEF JUSTICE
SRI M.S.RAMACHANDRA RAO
AND
THE HON'BLE SRI JUSTICE T.VINOD KUMAR
CMA No. 386 OF 2021
JUDGMENT:(Per Sri Justice M.S.Ramachandra Rao)
1. This Appeal is filed challenging the order dt.01.06.2021 in
IA.No.334 of 2020 in OS.No.79 of 2020 of the XVI Additional
District and Sessions Judge-cum-XVI Additional Metropolitan
Sessions Judge, Ranga Reddy District at Malkajgiri.
2. Appellant herein is plaintiff in the said suit.
3. It filed the said suit against the respondents for
declaration that the registered sale deed dt.19.02.2020 executed by the 1st respondent in favour of the 2nd respondent is null and void, and not binding on the appellant, and to direct the respondents to execute a registered sale deed in favour of the appellant in respect of the suit schedule property by receiving the balance sale consideration of Rs.2 Crores. Case of the appellant/plaintiff:
4. It is the contention of the appellant that it is a Company incorporated under the Companies Act, 1956; that 1st respondent is the absolute owner and possessor of subject property in a lay out sanctioned by the HMDA having purchased it under a registered sale deed dt.28.07.2016; that the 1st respondent offered to sell it to the appellant for Rs.3.5 Crores; that the parties had entered into an agreement of sale Ex.P2 dt.25.12.2019; that the appellant had issued two cheques 2 each for Rs.75 lakhs towards part sale consideration and both cheques were enchased by the 1st respondent; and that the 1st respondent had agreed to complete the registration process within 90 days.
5. It further contends that the appellant could not complete the transaction on account of COVID-19 pandemic as lock down was imposed; that in the last week of June, 2020, 1st respondent visited the office of the appellant and orally stated that she is cancelling the sale agreement dt.25.12.2019 without mentioning any reasons and gave three cheques for Rs.50 lakhs each, asking the appellant to present the cheques in the last week of July, 2020; that in the meantime, appellant came to know that the 1st respondent had executed a registered sale deed Ex.P3 on 19.02.2020 in favour of the 2nd respondent. The appellant also contended that all the cheques issued by the 1st respondent were deposited in the account of the appellant on 22.07.2020 but they were dishonoured on the ground of insufficient funds.
6. It alleged that the sale deed Ex.P3 is a sham transaction and it reveals that out of Rs.1.6 Crores mentioned in the alleged sale deed, only Rs.1.47 Crores was paid to Punjab National Bank, Lal Bazar Branch to redeem the mortgage.
7. According to the appellant, it appears that 1st respondent from the beginning had the intention to cheat the appellant and to cause financial loss to the appellant and it therefore prayed for the above reliefs.
3IA.No.334 of 2020
8. Along with the suit, the appellant filed IA.No.334 of 2020 under Order XXXIX Rules 1 & 2 of CPC seeking ad-interim injunction to restrain the respondents from alienating the suit schedule property.
9. The 1st respondent remained ex-parte in the suit. Case of the 2nd respondent/2nd defendant:
10. The 2nd respondent however filed a written statement disputing the contentions of the appellant and denying knowledge of Ex.P2 Agreement of Sale.
11. He contends that inter se transaction between the appellant and the 1st respondent appears to be a loan transaction; that since the property was under mortgage to the Bank, he obtained a no encumbrance certificate; and after verification of title, he paid the entire loan amount on the property to the bank and cleared the mortgage and then obtained Ex.P3 sale deed;.
12. He contended that Ex.P2 Agreement of Sale is unregistered and is also insufficiently stamped and since the appellant did not approach the Court with clean hands and suppressed facts about receiving amount towards cancellation of agreement of sale, the suit should be dismissed.
13. In the Court below, appellant marked Exs.P1 to P6, while the respondents did not mark any documents. 4 The order of the Court below in IA.No.334 of 2020
14. By order dt.01.06.2021, the Court below dismissed IA.No.334 of 2020.
15. It observed that only Rs.1.5 Crores out of Rs.3.5 Crores was paid to the 1st respondent by the appellant and the balance amount of Rs.2 Crores was not paid within the period of 90 days and that no material is placed to support his contention that the appellant was ready and willing to pay the balance amount.
16. It held that no notice was issued by the appellant stating that he is ready and willing to perform his part of the contract.
17. It also observed that till June, 2020, the appellant did nothing and pleaded COVID-19 pandemic and this indicated that he was not ready with the amount of Rs. 2 Crores, which was to be paid by March, 2020 itself.
18. It further held that no evidence is placed by the appellant that the cheques given to it by the 1st respondent had been dishonoured; that the sale transaction under Ex.P3 cannot be said to be a sham transaction merely because it mentioned the sale consideration as Rs.1.6 Crores, lesser than the sale consideration mentioned in the agreement of sale Ex.P2; and 2nd respondent had paid only Rs.1.47 Crores to the creditor bank i.e., Punjab National Bank.
19. It held that there is no material also to show that the 1st respondent had either colluded with the appellant or with the 2nd respondent and that can only be gone into in the trial. 5
20. It observed that even the averments in the agreement of sale showed that the 1st respondent had paid money to the Bank to clear the loan and when the appellant is not ready with the money, it is nothing but natural for the 1st respondent to sell the property to another party like the 2nd respondent and therefore, the transaction cannot be said to be collusive.
21. Assailing the same, this appeal is filed. Contentions of the counsel for the appellant :
22. Counsel for the appellant contended that the order passed by the Court below is erroneous, that any further sale by the 2nd respondent would procrastinate the litigation, and there was balance of convenience in favour of the appellant and the doctrine of lis pendence will not provide adequate protection as was observed by the Court below. He also contended that the Court below could not have held that the appellant was not ready and willing to pay the balance sale consideration.
23. We have noted the contentions of the counsel for the appellant.
The consideration by this Court :
24. It is undisputed that that the total sale consideration mentioned in Ex.P2 sale agreement dt.25.12.2019 executed in favour of the appellant by the 1st respondent is Rs.3.5 Cores and only Rs.1.5 Crores was paid as advance, leaving a balance of Rs.2 Crores.
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25. The agreement specifically states that out of the balance Rs.2 Crores, the appellant had to pay Rs.1.5 Crores to the Punjab National Bank as per the outstanding loan, which the 1st respondent took with the said bank and the balance of Rs.50 lakhs had to be paid to the 1st respondent and the entire transaction was agreed to be completed within 90 days, and if not, the vendee accepts and agrees to cancel the agreement.
26. As per the said agreement, the appellant was to pay Rs.1.5 Crores to the Punjab National Bank but there is no material placed by the appellant to show that he was ready and willing to pay this amount as well as the balance Rs.50 lakhs to the appellant. Without even issuing a notice to the 1st respondent stating that he is ready and willing to perform his contract within the time fixed for this purpose of 90 days from 25.12.2019, appellant filed the suit.
27. The 2nd respondent admittedly cleared the loan to the Punjab National Bank of Rs.1.47 Crores and obtained a registered sale deed Ex.P3 for Rs.1.6 Crores. Since Ex.P2 Agreement of Sale was not a registered document, there is no possibility of the 2nd respondent being aware of it.
28. Prima facie, it cannot be said that Ex.P3 is a sham document only because lesser consideration was shown in Ex.P3 than was mentioned in Ex.P2.
29. The plea of collusion between the 1st respondent and the 2nd respondent also cannot be presumed and is a matter to be proved during trial.
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30. In this view of the matter, we do not find any prima facie case in favour of the appellant and hold that any alienation made by the 2nd respondent of the subject property pending suit will abide by the result of the suit in view of Section 52 of the Transfer of Property Act, 1882.
31. We therefore do not find any merit in this appeal and it is accordingly dismissed.
32. However it is made clear that whatever observations made in this order or in the impugned order passed by the Court below are only for the purpose of deciding IA.No.334 of 2020, and the Court below shall decide the suit uninfluenced by any of its observations in the impugned order or by the observations made this Court in this appeal. No order as to costs.
33. Consequently, miscellaneous petitions pending, if any, shall stand closed.
___________________________________ M.S.RAMACHANDRA RAO, HACJ ___________________ T.VINOD KUMAR, J 24th September, 2021.
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