Bombay High Court
Shri. Vitthal Kalyanrao Choundgundi ... vs Smt. Shubhangi Rajendra Gurav on 3 May, 2024
Author: Sharmila U. Deshmukh
Bench: Sharmila U. Deshmukh
2024:BHC-AS:20335
SA 259 of 2017.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
SECOND APPEAL NO. 259 OF 2017
WITH
CIVIL APPLICATION NO.560 OF 2017
1. Vitthal Kalyanrao Choundgundi
Age- 48 years, Occ : Business
2. Anupama Vitthal Choundgundi
Age -41 years, Occ : Household
Both R/ at Gat No. 187, Urulikanchan
Tal. Haveli, Dist. Pune. ...Appellants/
Applicants
Versus
Subhangi Rajendra Gurav
Age -43 years, Occ : business
R/at Fat No. 601, Rohini Apartment,
Dsk Vishwa Dhayari, Pune. ...Respondent.
WITH
INTERIM APPLICATION NO. 2859 OF 2020
IN
SECOND APPEAL NO. 259 OF 2017
Subhangi Rajendra Gurav
Age -46 years, Occ : Business
R/at Fat No. 601, Rohini Apartment,
Dsk viswa Dhyari, Pune-411041,
Presently residing at Saptasur D/603
DSK Vishwa, Dhayari, District Pune 411041 ...Applicant.
Versus
1. Vitthal Kalyanrao Choundgundi
Age- 51 years, Occ : Business
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2. Anupama Vitthal Choundgundi
Age -44 years, Occ : Household
Both R/ at Gat No. 187, Urulikanchan
Tal. Haveli, Dist. Pune. ...Respondents.
------------
Adv. Rohan P. Surve for the Appellant.
Adv. Sushant Prabhune (through V.C.) a/w Mamta Pandey for the Respondent.
------------
Coram : Sharmila U. Deshmukh, J.
Reserved on : April 18, 2024.
Pronounced on : May 3, 2024.
JUDGMENT :
1. Second Appeal is at the instance of the original Defendant Nos.
1 and 2 suffering concurrent findings decreeing the Special Civil Suit
No. 519 of 2010 filed by the Respondent-Plaintiff herein. For the sake
of convenience, the parties are referred to their status before the
Trial Court.
FACTUAL MATRIX :
Plaint :
2. Special Civil Suit No. 519 of 2010 was instituted seeking specific
performance of agreement of sale dated 7th November, 2008
executed between the Plaintiff and the Defendants and registered in
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the office of Sub Registrar Haveli at Sr. No. 9255. The suit property is
described as 2R land along with RCC construction admeasuring 975 sq.
ft. Grampanchayat property No. 7 ward No. 6 Urulikanchan situated on
part of Gat No. 187, District Pune, owned by Defendant No. 1. An
agreement for sale was executed on 7 th November, 2008 wherein the
agreed consideration was shown as Rs.10,00,000/- and out of the total
consideration of Rs.10,00,000/-, the Plaintiff paid Rs.25,000/- by way
of cash and Rs.2,00,000/- was paid vide cheques dated 11 th November,
2008 and 13th November, 2008 to the Defendants.
3. As per the terms of agreement for sale, the balance amount of
Rs.7,75,000/- was to be paid after the Plaintiff obtains bank loan
within period of two months. As per Clause 4(h) of the agreement for
sale dated 7th November, 2008, the loan of Rs.1,50,000/- obtained by
the Defendants from Hanuman Gramin Bigar Sheti Patsanstha
Maryadit was to be repaid by the Defendants and clearance certificate
to be handed over to the Plaintiff before the execution of sale deed.
4. The Plaintiff applied for loan to various banks and showed her
willingness to execute the sale deed. However, the Defendant failed
to clear the encumbrance of Hanuman Gramin Bigar Sheti Sahakari
Pathsanstha Ltd (Hanuman Gramin) and to obtain clearance certificate
without which the Plaintiff's loan could not be sanctioned. The
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Defendants avoided to comply with their obligations of executing the
sale deed and delivery of possession and thus legal notice was issued
on 5th June, 2009 to which there was no response from the
Defendants. As such, suit came to be filed seeking specific
performance of the agreement for sale.
WRITTEN STATEMENT OF THE DEFENDANTS :
5. The case of the Defendants was that due to financial difficulties
by reason of the various loans as well as the financial burden of
educational expenses of the children and the marriage of the
daughter being fixed, the Defendants decided to sell their house. The
Defendants informed the Plaintiff that there was a loan of
Rs.1,00,000/- of one Mahatma Gramin Bigarsheti Sahakari Patsanstha
Maryadit, loan of Rs.75,000/- of Gram Rajya Nagari Sahakari
Patsanstha Maryadit and loan of Rs.1,50,000/- of Hanuman Gramin
Viaks Bigarsheti Sahakari Patsanstha Maryadit. The Defendants were
informed that the transaction would be cash transaction and amount
of loan would be paid in lumpsum. The consideration agreed between
the parties was of Rs.10,25,000/- out of which Rs.25,000/- was given
on 29th August, 2008 and Visar Pavti/agreement of sale was notarized.
The balance amount was to be paid within a period of 6 months from
the date of execution of sale deed. On 7 th November, 2008 the
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agreement for sale was registered with Sub Registrar Haveli. The
document was handed over to the Defendants without being
permitted to read the contents.
6. It was contended that as per the Visar Pavti dated 29th August,
2008, the consideration was Rs.10,25,000/- whereas in the agreement
for sale dated 7th November 2008, the consideration is shown as
Rs.10,00,000/- and the time for payment of balance consideration was
within period of 6 months from 29 th August, 2008 to 9 th March, 2009.
The Defendants were informed that for the purpose of assisting the
Plaintiff for obtaining loan the document was required to be
registered and the agreement dated 7th November, 2008 came to be
registered. On 27th December, 2008 the Plaintiff came to the house of
the Defendants along with her husband and one unknown person and
obtained the signature of the Defendants on a stamp paper of Rs.50/-
by assuring that payment of Rs.50,000/- would be made and without
making payment after obtaining the signature left the house. On 15 th
February 2009, written complaint was made, however, as no
cognizance was taken by the police, on 21st January, 2011 criminal
case has been filed before the JMFC. Notice dated 5 th June, 2009 was
received by the Defendants however, Defendants have not replied to
the notice.
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EVIDENCE :
7. The Plaintiff examined herself and the attesting witness to the
agreement for sale dated 7th November, 2008. The Defendants
examined themselves and also the official from Mahatma Gramin
Bigarsheti Sahakari Pathsanstha Ltd. and the guarantor in respect of
loan of Hanuman Gramin.
FINDINGS OF THE TRIAL COURT :
8. The findings of Trial Court can be broadly summarised as under :
The evidence of the Plaintiff is supported by the
evidence of attesting witness and documentary
evidence i.e Visar Pavti dated 29 th August, 2008 and
agreement for sale dated 7th November, 2008.
The Defendants evidence is inconsistent with the
pleadings and is not trustworthy.
If the signatures of Defendants had been obtained
on blank stamp paper, the Defendants would have
replied to the legal notice.
The Defendants failed to prove the total
consideration was fixed at Rs.10,25,000/- and that the
Plaintiff has not prepared false and bogus documents.
The evidence of the Plaintiff is in consonance with
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Clause-H of the agreement for sale dated 7 th
November, 2008. The evidence of the Defendants that
the sale deed was to be executed within a period of six
months from the date of agreement is contrary to
Clause-4(A) of the agreement for sale deed of 7 th
November, 2008.
The Plaintiff was ready and willing to perform the
part of the contract and the Defendants were in breach
of agreement as the loan of Rs.1,50,000/- of Hanuman
Gramin was not repaid.
APPELLATE COURT FINDINGS :
9. The Appellate Court framed and answered the points for
determination as under :
Sr. No. Points Findings
01. Does Plaintiff proves that she is ...In the
entitled for specific performance of Affirmative
contract? .
02. Does Plaintiff proves that she was ...In the
and is 'ready' and 'willing' to Affirmative
perform her part of contract ? .
03. Is there any need to interfere in the ...In the
impugned Judgment & Decree, dtd. Negative.
31/10/2012., passed by Ld. Trial
Court?
04. What order ? As per final
order.
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10. The Appellate Court considered that the Defendant No. 1 has
admitted that the agreement for sale was written in Marathi as the
Defendants can read and write Marathi and that he has also admitted
the undertaking committed through the said agreement for sale. The
Appellate Court noted that the cheques of sum of Rs.2,00,000/- were
encashed by the Defendants. The Appellate Court noted that the
attesting witness Yogesh B. Bibwe has deposed as to the terms and
conditions of the agreement for sale and the consideration being
fixed at Rs.10,00,000/- as well as the payment of earnest money. The
Defendant No. 1 has admitted that consideration of Rs.10,00,000/- is
higher than the market value and that the said transaction cannot be
said to create hardship for the Defendant. The Plaintiff is ready and
willing to pay the balance amount however, the Defendants failed to
clear the debt and failed to obtained clearance certificate from the
financial institution and thus, the Plaintiff was unable to obtained the
loan from the bank.
SUBSTANTIAL QUESTION OF LAW :
11. The Second Appeal came to be admitted by order dated 7 th
September, 2017 on the following substantial question of law.
"Whether the Trial Court as well as the First Appellate
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Court were justified in holding that the Appellants are
required to specifically perform the Agreements dated
29th August, 2008 and 7th November, 2008 pertaining
to the suit property in favour of the Respondent ?"
SUBMISSIONS :
12. Mr. Surve, learned counsel for Appellant submits that the Visar
Pavti dated 29th August, 2008 discloses that the agreed consideration
was Rs.10,25,000/- and transaction had to be completed within a
period of 6 months. He submits that the agreement for sale dated 7 th
November, 2008 added pre-condition of clearance of loan of
Rs.1,50,000/- taken from the financial institution and the
consideration was reduced from Rs.10,25,000/- to Rs.10,00,000/-. He
submits that the Defendant had taken three loans of Rs.1,00,000/-,
Rs.1,50,000/- and Rs.75,000/- and that is the reason why the property
had to be sold and is evidence of the fact that the pre-condition of
clearing only one loan of Rs.1,50,000/- has been inserted without the
consent of the Defendants. He submits that on 15 th February, 2009
written complaint was filed with the police. He submits that as there is
no valid and legal enforceable contract due to variance in the terms of
the Visar Pavti and agreement for sale, specific performance could
not have been granted.
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13. Per Contra, Mr. Prabhune, learned counsel for the Respondent
would submit that the Trial Court and the Appellate Court have
arrived at concurrent finding as regards the execution of the
agreement for sale and the readiness and willingness of the Plaintiff.
He further submits that the balance consideration has already been
deposited by the Respondent in the execution proceedings. Pointing
out to the various clauses of the agreement for sale dated 7 th
November, 2008, he submits that the obligation was upon Defendants
to clear the loan and thereafter the period of two months would
commence. He would point out to the evidence of the Defendant No.
1 and would submit that the Defendant No. 1 has admitted that in
respect of other loans he has not mortgaged any property and the
loan agreement has not been tendered in evidence. He submits that
there was no reply to the legal notice issued by the Plaintiff and there
is no challenge to the agreement of sale. As regards the alleged
signatures being obtained on blank stamp papers in December, 2008
he submits that there was already an agreement for sale executed
between the parties and it is not shown as to where the said blank
stamp papers were utilized.
14. He would submit that the terms of the said Visar Pavti are
unreliable due to different figures at different places. He submits that
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the complaint was filed on 15 th February, 2009 and there is a delay in
filing of the complaint. He submits that the agreement for sale being
valid document specific performance was rightly granted.
REASONS AND ANALYSIS :
15. The jurisdiction to order specific performance of contract is
based on the existence of valid and enforceable contract. Even in case
where there is a valid and enforceable contract, discretion is vested in
the Court by taking into consideration the totality of circumstances to
order specific performance of the contract or not as by way of specific
performance, what the Court does is to enforce the obligations
contained in the contract and hence, the terms and conditions of the
agreement have to be certain.
16. The contention of Defendants is that there is no valid and
enforceable contract as terms of Visar Pavti varies from the terms of
the registered agreement for sale. To put it simply the case of the
Defendants is there was no informed consent of the Defendants to
the registered agreement for sale as the terms were changed without
the knowledge of the Defendants. The execution of the Visar Pavti
dated 29th August, 2008 as well as the agreement for sale dated 7 th
November, 2008 is however, not in dispute. The difference in the
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terms of the Visar Pavti and Agreement for Sale is qua the sale
consideration which is reduced from Rs.10,25,000/- to Rs.10,00,000/-
and addition of pre-condition of clearance of loan of Hanuman Gramin
of Rs.1,50,000/-.
17. The Visar Pavti was notarised on 29 th August, 2008 and the
Agreement for Sale was registered on 7th November, 2008. and there
is a presumption that the registered document has been validly
executed. In order to determine whether the Defendants were aware
of the terms of the registered agreement for sale and had agreed to
the terms, the evidence when perused discloses that Defendant No. 1
has given vital admissions in his cross-examination.
18. The submission of Mr. Surve qua the added pre condition is that
there were other two loans and therefore there is no reason why only
clearance of loan of Rs.1,50,000/- would be agreed between the
parties. In the cross-examination the Defendant No. 1 has admitted
that in respect of the Mahatma Gramin Bigarsheti Sahakari Patsanstha
and Gram Rajya Nagari Sahakari Patsanstha, the loan was obtained
without any collateral security. He has further admitted that the loan
agreement has not been produced in the present proceedings and
even in the written statement there is no mention of any such loan
agreement. He further admits that the encumbrance of Hanuman
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Gramin has been noted in village from 8A and no other encumbrance
is noted on village 8A. It is thus evident that as the Plaintiff required
the clearance certificate of the suit property for obtaining loan, as the
only encumbrance on the suit property was the loan of Hanuman
Gramin, the pre condition of clearance of loan of Hanuman Gramin
was agreed by the parties.
19. The Defendant No. 1 has further admitted that as per the
agreed terms on 7th November, 2008, the agreement for sale was
executed. He has admitted that the agreement for sale contains the
signature of himself and his wife. He has admitted that it was agreed
that the remaining amount of Rs.7,75,000/- will be paid within a
period of two months from the agreement date. He has admitted that
the per-condition of removal of encumbrance on the said property is
part of the agreement for sale and that the consent of the
Defendants has been recorded in the agreement for sale. Most
pertinently, he has admitted that the market value of the suit
property is about Rs.8,53,000/-, however, the sale consideration was
agreed for Rs.10,00,000/-.
20. The Defendant No. 1 has further admitted that he is conversant
with Marathi language and the agreement has been scribed in Marathi
so that the contents can be understood by the Defendants. He has
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further admitted that the consideration of Rs.10,00,000/- is more than
market rate and he has no document to show that the sale
consideration was fixed at Rs.10,25,000/-. He has further admitted
that he had received a sum of Rs.2,25,000/- and in the expectation of
receiving the balance amount, he has registered the agreement for
sale. He has further admitted that he was aware that the balance
amount was to be received within a period of two months and that
the village form 8A as well as the 7/12 extract was handed over by him
to the Plaintiff at the time of registration of the agreement for sale.
He has further admitted that he has agreed in the agreement for sale
that the encumbrance of Hanuman Gramin Bigarsheti Sahakari
Patsanstha Maryadit will be cleared prior to execution of sale deed.
He has admitted that the encumbrance of Hanuman Gramin was to be
cleared by him within period of two months. He has admitted that due
to loan encumbrance, the Plaintiff's loan could not be sanctioned.
21. He has further admitted that at the time of execution of the
agreement for sale he had taken legal advise and when he approached
his Advocate, he was aware of the terms of the agreement for sale. He
was admitted that after understanding the terms of the agreement of
sale he has signed the agreement for sale.
22. The Defendants have examined an official of Mahatma Gramin
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Bigarsheti Sahakari Patsanstha Maryadit who has deposed that a loan
of Rs.1,00,000/- was obtained by the Defendant No. 2 which has been
repaid on 1st December, 2008 along with the interest aggregating to
Rs.1,89,204/-. In the cross-examination, the witness has admitted that
the evidence as regards the repayment of the loan amount of 1 st
December, 2008 was prior to his joining of the service. He has further
admitted that he has not obtained any approval from the financial
institution for the purpose of giving evidence. He has further
admitted that he has not aware whether any action was taken by the
financial institution against the Defendant for non payment of the
loan. He has further admitted that he has not perused the office file
as pertaining to the loan obtained by the Defendants prior to
appearing before the Court.
23. The witness of the agreement for sale dated 7th September,
2008 has been examined by the Plaintiff who has deposed that the
sale consideration was fixed at Rs.10,00,000/- and accordingly the
agreement for sale executed which was registered on 7 th September,
2008. He has deposed that the Defendants had signed the agreement
in his presence and thereafter he has signed as witness. He has further
deposed that the payment of Rs.2,25,000/- was paid by the Plaintiff
to the Defendant toward part sale consideration.
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24. The admissions given by the Defendant No. 1 in his cross-
examination noted above has practically demolished the defence of
the Defendants. The evidence would demonstrate that the agreement
for sale dated 7th November, 2008 has been executed by the
Defendants after complete understanding of the terms thereof and
therefore the consent of the Defendants was free and informed
consent and there is no element of fraud proved by the Defendants. In
event if the execution of the agreement for sale was contrary to the
agreed terms the logical step would be send legal notice to the
Plaintiff setting out the said facts and terminating the agreement for
sale. On the contrary, in the present case, even after the notice dated
5th June, 2009 was issued to the Defendants calling upon them to
execute the sale-deed, there is no response of the Defendants to the
said document. Even in the present proceedings where the relief of
specific performance of the agreement was sought, there is no
counter claim filed by the Defendants seeking cancellation of the
agreement for sale. By not complying with their obligations of
removal of encumbrance of Hanuman Gramin, despite having received
Rs.2,25,000/, the Defendants have committed breach of the
agreement for sale.
25. If we consider the case of the Defendants as regards the
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variance in the terms of Visar Pavti and the agreement for sale,
perusal of the Visar Pavti which is at Exhibit 39 shows that the sale
consideration is shown as Rs.10,25,000/- and the agreement for sale
consideration is shown at Rs.20,000/-. It is admitted position that the
amount which was paid before the execution of the Visar Pavti was
Rs.25,000/- and not Rs.20,000/-. In clause-4 of the said Visar Pavti,
there is an admission that cash amount of Rs.25,000/- is received by
the Defendants for which there is no separate receipt issued and in
clause-4 immediately thereafter it is stated that the balance amount
of Rs. 1,05,000/- will be paid at the time of execution of the sale deed.
Considering clauses 3 and 4 together, if the sum of Rs.25,000/- was
paid out of total agreed consideration of Rs.10,25,000/-, the balance
amount would be Rs.10,00,000/- and not Rs.10,05,000/- as stated. It is
therefore clear that there is error in the amounts written in the Visar
Pavti and the Defendants are seeking to take undue advantage of the
error.
CONCLUSION:
26. From the evidence on record, it is established that the terms
and conditions of the registered agreement for sale were in
accordance with the terms agreed upon between the Plaintiff and the
Defendants. The Defendants had executed the registered agreement
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for sale being fully aware of the terms and conditions contained
therein. Despite having received part payment of Rs.2,25,000/-, the
Defendants failed to comply with their obligation to clear the
encumbrance of Rs.1,50,000/- of Hanuman Gramin. As the pre
condition was not satisfied, the Plaintiff could not obtain loan and the
Plaintiff is ready and willing to comply with the terms of the
agreement. The agreed consideration of Rs.10,00,000/ was more than
the market value and no hardship would be caused to the Defendants.
27. Considering the totality of circumstances, the Appellate Court
has rightly ordered specific performance of the registered agreement
for sale dated 7th November, 2009.
28. The substantial question of law is accordingly answered against
the Appellant. Resultantly, Appeal stands dismissed.
29. In view of dismissal of Second Appeal, Civil/Interim Applications,
if any, taken out therein are not survive for consideration and the
same are disposed of.
[Sharmila U. Deshmukh, J.]
Harish 18 of 18
Signed by: Harish V. Chaudhari
Designation: PA To Honourable Judge
Date: 03/05/2024 19:34:25
