Shiv Kumar Sharma vs Santosh Kumari
2006 Latest Caselaw 1407 Del

JUDGMENT

T.S. Thakur, J.

1. This Regular First Appeal arises out of a judgment and decree passed by the Additional District Judge, Delhi in a suit for possession of shop No. 1241, Bazar Sangtrashan, Pahar Ganj, New Delhi filed by the plaintiff-respondent and decreed by the said Court with costs.

2. Shop No. 1241 situate in Bazar Sangtrashan, Pahar Ganj, New Delhi was purchased by the plaintiff-respondent from the erstwhile owner, Smt. Sumitra Devi in terms of a sale deed registered on 29th July, 1974. The plaintiff's case in the suit for possession filed by her before the Court below was that in terms of an agreement dated 30th May, 1995, executed between her and the defendant-appellant herein, the shop owned by the plaintiff was agreed to be sold to the defendant for a consideration of Rs. 4,75,000/-. This amount was to be received by the plaintiff partly by way of transfer in her favor of shop No. 598/1 situate in Gali Kaitwali, Sangtrashan, Pahar Ganj, New Delhi valued at Rs. 3,25,000/- and partly in cash to be paid by the defendant. The relevant portion of the agreements allegedly executed between the parties was as under:

WHEREAS the first party is the owner/lessee/ occupier of house/ shop/property No. 598/1 (Part) measuring 10'X4' sq. yds. Situated at Gali Khet Wali Sangatrashan Paharganj, New Delhi comprising of Ground storey construction having one shop on Group Floor and no concern with other portion of the said property.

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AND WHEREAS the first party has agreed to sell the above mentioned property super-structure with the occupancy rights/ownership /leasehold rights of the land beneath the same to the second party for a sum of Rs. 3,25,000/- (Rupees Three lacs twenty five thousand only) and the second party has agreed to purchase it.
 

And whereas the second party is the absolute owner of building No. 1241, Sangtrashan, Paharganj, New Delhi comprising of the ground floor and first floor having purchased from its rightful owner.
 

And whereas on the second floor of aforesaid building No. 1241, there is one shop.
 

And whereas the second party has agreed to sell the said shop unto the first party for a sum of Rs. 4,75,000/- (Rs.four lacs seventy five thousand only).
 

Now this agreement witnesseth as follows:
  

1. That the sale price of aforesaid shop No. 598/1, has been agreed at Rs. 3,25,000/- (Rs.three lacs twenty five thousands only) out of which the first party has received and the second party has paid unto the first party a sum of Rs. Three lacs which the first party hereby acknowledges to have received the said amount.
 

2. That the sale price of aforesaid shop out of building bearing No. 1241, has been agreed at Rs. 4,75,000/- and it has further been agreed that out of the aforesaid amount the first party shall give by way of transfer of one shop with private No. 598/1 situated on the right side if one faces building situated on the ground floor out of the double storeyed building No. 598, Gali Kaitwali, Sangtrashan, Paharganj, New Delhi, valued at Rs. 3,25,000/- by way of registered sale deed in favor of second party and the rest of the amount of Rs,1,50,000/- shall be paid by the first party unto second party before the Registrar at the time of registration of sale deed if any.

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6. That as a part performance of the agreement  the first party has delivered the vacant  possession of aforesaid shop No. 598/1, unto  the second party and likewise second party has delivered the vacant possession of aforesaid shop forming party of building No. 1241, Sangtrashan, Paharganj, New Delhi unto the first party.
 

3. The plaintiff's further case was that after the execution of the above agreement, she, time and again, approached the defendant-appellant herein to show him the title deeds in respect of Shop No. 598/1 and to complete his part of the transaction by executing a sale deed in her favor, but he failed to do the needful. A legal notice was, therefore, sent by the plaintiff asking the defendant-appellant to deliver back the possession of the shop owned by the plaintiff as the proposed transaction, which was in the nature of an exchange of the two properties and payment of a sum of Rs. 1,50,000/- for equalizing their value, had failed. Despite the receipt of this notice, the defendant did not oblige, forcing the plaintiff to file a suit for possession and injunction restraining the defendant from alienating or encumbering the suit property.

4. The defendant contested the suit on several grounds and, inter alia, alleged that the plaintiff had on 27th March, 1995 agreed to sell the property to the defendant for a sum of Rs. 4,75,000/- and received a sum of Rs. 3,00,000/- from him. The plaintiff had in part performance of the said agreement put the defendant in possession of the shop owned by her. The defendant's further case was that the room on the first floor of the shop was also to be vacated and handed over by plaintiff to the defendant. It was, according to the defendant, agreed between the parties that the remaining consideration of Rs. 1,75,000/- payable to the plaintiff would be paid after she hands over the said room and gets a sale deed registered in favor of the defendant. It was alleged that the defendant had already paid valuable consideration for the property covered by the agreement, a part whereof was in his possession. The suit was, according to the defendant, dishonest and inspired by the fact that the defendant's business had flourished after he came in possession of the suit property.

5. On the pleadings of the parties, the Court below formed the following issues:

(i). Whether the suit is not maintainable in view of the provisions of Sections 38 & 41 of the specific relief Act?

(ii). Whether the suit has not been properly valued for the purposes of court fee and jurisdiction?

(iii). Whether the agreement dated 30.5.95 as alleged was executed between the parties? OPD

(iv). Whether the agreement dated 30.5.95 is forged and fabricated? If so, to what effect.

(v) Whether the defendant is the owner of property No. 598/1 Gali Kaitwal, Sanghtrashan, Pahar Ganj, New Delhi?

(vi) Whether the plaintiff is entitled to the possession and injunction prayed for?

(vii) Relief.

6. In support of her case, the plaintiff examined PW-1, Shri R.K. Bhardwaj, PW-2 Shri M.L. Kukreja, PW-3 Shri Ramesh Chand, PW-4 Darshan Lal and PW-5 Shri Kamal Kant Khandelwal, handwriting expert.

7. In rebuttal, the defendant appeared as his own witness apart from examining Shri S.P. Singh, a handwriting expert and DW-3 Shri Mahipal Sharma.

8. Appreciation of the evidence adduced by the parties led the trial court to decide Issue No. 1 in favor of the plaintiff. The Court held that the suit was not hit by the provisions of Section 38 of the Specific Relief Act, nor was it a case where relief could be denied to the plaintiff under Section 41 of the said Act.

9. Issue No. 2 regarding valuation of the suit for the purpose of court fee and jurisdiction was also similarly decided against the defendant. As regards Issues No. 3,4,5 and 6, the court took up the same together and held that the defendant's version that there was an oral agreement to sell Shop No. 1241 to the defendant between the parties in March, 1995 for a consideration of Rs. 4,75,000/- and that the defendant had paid Rs. 3,00,000/- to the plaintiff pursuant to the said agreement, was not substantiated nor was it proved that the possession of the shop in question was handed over to the defendant on March 27, 1995 as alleged by the defendant. The alleged payment of Rs. 3,00,000/- in cash to the plaintiff by the defendant without creating any documentary proof in regard thereto was, according to the Court, highly improbable especially when the defendant was well-versed in these matters being himself a property dealer. In the absence of any evidence to support the oral agreement dated 27th March, 1995 set up by the defendant, the Court held that no such agreement was ever arrived at.

10. The Court then examined the agreement marked Ex.DW-3/P1, the address of the parties and the telephone numbers mentioned therein and came to the conclusion that shop No. 598/1 was actually in possession of the defendant before the transfer of the possession to the plaintiff and that the possession of the same was transferred pursuant to the agreement mentioned above which was a genuine document on which the signatures of the defendant were proved. The expert evidence apart, the Court relied upon the statements of PW-3 Shri Ramesh Chand as well as PW-4 Shri Darshan Lal, who stated that the said agreement was executed by the plaintiff, his sister and the defendant and that the same bear their signatures as well as the signatures of the witnesses. In the light of the depositions of these witnesses, the Court below held that the defendant's version that he did not execute the agreement was false and an afterthought. The Court accordingly answered Issues No. 3,4,5 and 6 in favor of the plaintiff and against the defendant and consequently decreed the suit for possession of Shop No. 1241 with a permanent prohibitory injunction restraining the defendant from selling, alienating or parting with the possession of the said shop to any third party. The present appeal as noticed earlier calls in question the correctness of the said judgment and decree.

11. When this appeal came up for hearing before us on 3rd July, 2006, the parties sought an opportunity to explore the possibilities of an amicable settlement with the help of the Medication/Conciliation Centre in the High Court. They were accordingly referred to the Conciliation Centre for that purpose with the direction that the result of the mediation proceedings shall be reported to this Court by the 23rd August, 2006. On 23rd August, 2006, counsel for the parties submitted that the mediation proceedings had failed to yield any acceptable solution to the dispute. The appeal was in that view heard by us on merits for final disposal.

12. Appearing for the appellant, Mr. Sengh fairly conceded that there was no evidence to prove the version set up by the defendant-appellant that he was put in possession of the shop on the basis of an oral agreement on March 27, 1995 or that the defendant had paid a sum of Rs. 3,00,000/- to the plaintiff pursuant to the said agreement. He also did not seriously question the finding recorded by the trial court that agreement marked Ex.DW-3/P1 was the only basis on which the parties had exchanged with each other the possession of their respective shops. In that view, the only question that remains to be examined is whether the defendant had any subsisting legal right to stay in occupation of the shop owned by the plaintiff and, if he did not have any such right whether restoration of possession of Shop No. 598/1 presently occupied by the plaintiff could be demanded back by him as a condition precedent for surrender of possession of shop No. 1241.

13. There is no instrument either by way of a registered sale deed or a deed of exchange executed between the parties under which the defendant may claim ownership over the suit shop. The transaction which the agreement executed between the parties was essentially in the nature of an exchange of the two shops, but since the value of the shops was unequal, the defendant had to pay in addition to transferring his own shop No. 598/1, a sum of Rs. 1,50,000/- to the plaintiff. The transaction proceeded on the clear premise that the defendant had absolute title to the shop which he was transferring to the plaintiff, the value whereof was fixed at Rs. 3,25,000/-. Since, however, the plaintiff had failed at the trial to disclose any title to the said property, there was a complete "failure of consideration" underlying the agreement for the transfer of the suit property in favor of the defendant. Super added to this was the failure of the defendant to pay the additional amount of Rs. 1,50,000/- to the plaintiff rendering the agreement unenforceable in law. That being so, the defendant did not acquire nor did he have any subsisting legal right to stay in possession of the suit shop. The plaintiff's claim for possession was in that view rightly decreed by the court below.

14. Mr. Sengh, however, strenuously argued that if the bargain had failed, it could not do so only in part. Surrender of the shop No. 598/1 which the plaintiff was holding had to be a condition precedent for any direction requiring the defendant to surrender possession of the shop in his occupation.

15. Mrs. Luthra, on the other hand, contended with considerable vehemence that the defendant had not made any claim for return of shop No. 598/1 presently in occupation of the plaintiff. If the defendant wanted return of the possession of the said shop, he ought to seek redress in appropriate proceedings. She further contended that while the defendant had made use of the shop owned by the plaintiff for nearly ten years, the plaintiff had not been able to do so for want of an electricity connection and other complications arising out of absence of a clear title in her. She argued that the plaintiff had a legitimate claim for payment of damages/mesne profits against the defendant and that so long as the same were not quantified and paid, the plaintiff could decline surrender of possession of shop No. 598/1. Reliance was placed by her upon a decision of the Supreme Court in Atma Ram Properties v. Federal Motors 2005 Rajdhani Law Reporter 90 (SC) to argue that this Court could even in the present appeal determine the amount of mesne profits/damages and award the same to the plaintiff to do complete justice between the parties.

16. The transaction as noticed earlier envisaged an exchange of the two shops and payment of an additional sum by the defendant to equalise their prices. Possession of the shops was accordingly handed over by one party to the other. The parties have ever since the year 1995 been in possession of the shop which they were supposed to purchase from the other party under the agreement. If the transaction has failed for the reasons indicated by us earlier, the parties will have to be relegated back to the position that they held before the agreement was executed. This would mean that while the plaintiff would be entitled to the possession of her shop, she cannot under the failed bargain retain the shop the possession whereof was transferred to her by the defendant. Any decree for possession in favor of the plaintiff shall in equity have to be subject to the surrender by the plaintiff of the shop which the defendant had transferred to her. Mr.J.P.Sengh's contention to that extent is well-founded.

17. The question that all the same remains is whether the transfer of possession of the shop in possession of the plaintiff to the defendant would suffice and provide an equitable solution without any further direction to the defendant to compensate the plaintiff for the non-payment of the amount which the defendant had to pay to the plaintiff under the agreement executed between them. Our answer is in the negative. The defendant had to pay a sum of Rs. 1,50,000/- to the plaintiff over and above transferring the title and possession of Shop No. 598/1. That would have completed the bargain between the two subject to formalities of verification of title of the defendant and execution of proper instruments of transfer. The defendant did not admittedly pay that amount to the plaintiff. The result was that while the defendant enjoyed possession of the shop taken over by him, the plaintiff was denied the benefit of a similar advantage of an equivalent value. The shop with the plaintiff was lesser in value to the extent of Rs. 1,50,000/-. Even assuming that the plaintiff's failure to make use of the shop that was put in her possession was not attributable to any default on the part of the defendant, the fact remains that the bargain had remained unequal for want of payment by the defendant of the additional amount of Rs. 1,50,000/- due to the plaintiff. Any equitable direction for return of the possession of the shop held by the plaintiff under the agreement must, therefore, take into account this aspect and provide for a suitable compensatory reimbursement to the plaintiff. The least, which the plaintiff would on that account be entitled to by way of an equitable direction is the payment of interest @ 6% per annum on the amount of Rs. 1,50,000/- withheld by the defendant calculated from the date of the execution of the agreement Ex.DW-3/P1, i.e., 30th May, 1995 till the date of payment. Such a direction can, in our opinion, be legitimately issued by this Court for courts in this country are not only courts of law but courts of equity also. One of the well-established canone of law of equity is that one who pleads equity must do equity. If the defendant demands restoration of the possession of his shop to him on the principles of equity, he must not grudge an equitable direction which would place the parties on an equal playing field. The defendant cannot possibly demand restoration of the position that existed before the execution of the agreement without first compensating the plaintiff for the loss which she suffered on account of non-payment of the equalising payment of Rs. 1.50 lacs.

18. In the result, we allow this appeal and in modification of the judgment and decree passed by the Court below, decree the plaintiff's suit on the following terms:

i) The suit for possession filed by the plaintiff in respect of Shop No. 1241 shall stand decreed with costs throughout.

ii) Subject to the plaintiff depositing interest @ 6% per annum on a sum of Rs. 1,50,000/- calculated from 30th May, 1995 till the date of actual payment/deposit, the defendant shall be entitled to recover by execution of this decree the possession of Shop No. 598/1 from the plaintiff.

iii) Subject to all just exceptions including limitation, liberty is given to the plaintiff to claim relief by way of damages/mesne profits in a separate suit filed before the competent court.