Mallikarjun S/O Kashappa Sangavi vs Dr.Sujatha W/O Dr.Shashikant ...
2022 Latest Caselaw 9458 Kant

                              1

            IN THE HIGH COURT OF KARNATAKA
                   KALABURAGI BENCH

        DATED THIS THE 23RD DAY OF JUNE 2022

                          PRESENT

 THE HON'BLE MR.JUSTICE SREENIVAS HARISH KUMAR

                             AND

           THE HON'BLE MR.JUSTICE S. RACHAIAH

       REGULAR FIRST APPEAL No.200060/2016
                       C/W
             RFA CROB. No.200003/2017
                       (SP)
RFA No.200060/2016:

Between:

Mallikarjun S/o Kashappa Sangavi
Age: 61 Years
Occ: Rtd. Govt. Servant
R/o H.No.Now 10-1495
Bhagawati Nagar
Kalaburagi
                                           ...Appellant
(By Sri Subhash Mallapur, Advocate)

And:

Dr. Sujatha
W/o Dr. Shashikanth Harkood
Age: 45 Years, Occ: Medical Practioner
R/o Near Balaji Mandir, Humnabad
Dist. Bidar - 585 401
                                         ...Respondent
(By Sri Manvendra Reddy, Advocate &
Sri Narendra M. Reddy, Advocate)
                                 2

       This RFA is filed under Section 96 of the Code of Civil
Procedure praying to allow the appeal by setting aside the
judgment and decree passed by the Principal Senior Civil
Judge, Kalaburagi in O.S.No.182/2011 dated 18.04.2016 in so
far it relates to the granting of alternate relief of directing the
appellant to pay earnest money to the respondent.

RFA Crob.No.200003/2017:

Between:

Dr. Sujatha
W/o Dr. Shashikant Harkood
Age: 51 Years, Occ: Medical Practioner
R/o Near Balaji Mandir, Humnabad
Dist. Bidar - 585 401
                                                ...Cross-Objector

(By Sri Manvendra Reddy, Advocate &
Sri Narendra M. Reddy, Advocate)

And:

Mallikarjun
S/o Kashappa Sangavi
Age: 66 Years
Occ: Retired Government Servant
R/o H.No.10-1495
Bhagawati Nagar
Kalaburagi (Present Address) - 585 103

                                                   ...Respondent
(By Sri Subhash Mallapur, Advocate)

      This RFA Crob. is filed under Order XLI Rule 22 of the
Code of Civil Procedure praying to dismiss the appeal filed by
the appellant in RFA No.200060/2016 with costs and allow the
Cross Appeal filed by the Cross-Objector/plaintiff and set aside
the judgment and decree passed in O.S.No.182/2011 dated
18.04.2016 passed by the learned Principal Senior Civil Judge,
                                   3

Kalaburagi and decree the suit of the Cross Objector/plaintiff
and grant the relief of specific performance as prayed for in the
suit with costs throughout.

       These RFA and RFA Crob. are coming on for Final
Hearing, this day, SREENIVAS HARISH KUMAR J., delivered
the following:

                         JUDGMENT

This appeal and cross-objection arise from the

judgment and decree dated 18.04.2016 in

O.S.No.182/2011 on the file of Principal Senior Civil

Judge, Kalaburagi. The appellant is the defendant and

the cross-objector is the plaintiff in the suit.

2. For the sake of convenience and clarity, the

parties are referred with respect to the position of each of

them in the suit.

3. The plaintiff's case is that, the defendant being

the absolute owner of house property bearing

No.1-1495/48/C and 1-1495/48/C1 constructed on plot

No.24, bearing CTS No.1259, Sheet No.109, Chalta No.8,

Block No.VII situate at Angarkar Layout, behind S.K.

Yatrik Nivas, Bhagavati Nagar, Station Ward, Gulbarga

measuring 40' x 60' and consisting of ground floor and

first floor, entered into an agreement of sale with the

defendant on 30.10.2008 for selling the said property for

total sale consideration of Rs.38,00,000/-. Prior to

execution of the agreement, the plaintiff met the defendant

at Bengaluru on 28.08.2008 and finalized the sale

consideration amount. At that time, the defendant

received a sum of Rs.1,05,001/- from the plaintiff's

husband. Rs.5,001/- was paid by the plaintiff's husband

by way of cash and Rs.1,00,000/- was paid through

cheque dated 28.08.2008 drawn on State Bank of India,

Humnabad Branch. Then, the agreement was executed at

Kalaburagi on 30.10.2008 and at that time, the plaintiff

made payment of Rs.12,00,000/- to the defendant being

the part of the sale consideration. The defendant having

received Rs.13,05,001/- from the plaintiff, agreed to

execute the sale deed in favour of the plaintiff after

obtaining permission from the Government for selling

house property. Though the plaintiff was ready to pay the

balance of sale consideration, the defendant did not show

any interest to obtain permission from the Government

and execute the sale deed in favour of the plaintiff.

Sensing the mala fide intention of the defendant, the

plaintiff got issued a legal notice to the defendant on

20.09.2011 demanding the defendant to execute the sale

deed. The legal notice sent to the official address of the

defendant was served on him. Inspite of notice being

issued, defendant did not execute the sale deed and

therefore, the plaintiff was constrained to file a suit to

enforce the agreement. Alternatively, the plaintiff sought

refund of earnest money of Rs.13,05,001/- with interest at

the rate of 18% per annum.

4. In the written statement, defendant admitted

the receipt of the advance amount paid by the plaintiff's

husband and stated that he applied for permission to the

Government for executing the sale deed, but he could not

obtain permission and the same was conveyed to one

H.N. Ture, the broker who negotiated the transaction

between him and the plaintiff. He expressed his inability

to execute the sale deed for this reason. He also made it

clear that he was ready to return Rs.1,05,001/- which he

had received on 28.08.2008. However, in regard to

execution of agreement on 30.10.2008, it is contended

that the plaintiff's husband and the broker might have

fabricated it by forging the signature. He specifically

contended that when he brought it to the notice of the

broker that he had not obtained permission from the

Government, occasion to execute the agreement on

30.10.2008 would not have arisen. He also denied to have

received Rs.12,00,000/- from the plaintiff being the part of

sale consideration. He contended that there was no

privity of contract between him and the plaintiff, and in

this view, the suit is liable to be dismissed.

5. Based on the pleadings, the trial Court framed

the following issues:

"1. Whether the plaintiff proves that the defendant has agreed to sell the suit property for sale consideration amount of Rs.38,00,000/- and executed an agreement of sale in her favour on 30.10.2008?

2. Whether the plaintiff further proves that, the defendant has received an earnest money of Rs.1,05,001/- on 28.08.2008 and Rs.12,00,000/- on 30.10.2008?

3. Whether the plaintiff further proves that, she is ready and willing to perform her part of contract?

4. Whether the defendant proves that, the suit of the plaintiff is barred by time?

5. Whether the plaintiff is entitled for the relief sought for?

6. What Decree or Order?"

6. From the plaintiff's side, three witnesses

adduce d evidence as P.W.1 to P.W.3 and produce d

eight documents as pe r Ex.P.1 to Ex.P.8. The

defendant adduced evidence as D.W.1 and got

marke d nine documents as per Ex.D.1 to Ex.D.9.

7. The trial Court assessed the evidence and

came to conclusion that the defendant executed the

agreement in favour of the plaintiff on 30.10.2008, having

received part of the consideration of Rs.13,00,000/- out of

total consideration of Rs.38,00,000/- and also answered

the issue with regard to readiness and willingness in

favour of the plaintiff. Giving the reason that the

defendant was not able to execute the sale deed as he

could not obtain permission from the Government, and in

this circumstance, if the decree of specific performance

was granted, his interest would be greatly affected, the

trial Court declined to grant specific performance and in

the alternative, directed the defendant to repay the earnest

money of Rs.13,05,001/- with interest at the rate of 6%

per annum. For granting alternative relief of refund of

earnest money, the defendant has preferred the appeal

and for not granting the relief of specific performance, the

plaintiff has preferred cross-objection.

8. We have heard Sri Subhash Mallapur, learned

counsel for the appellant and Sri Manvendra Reddy,

learned counsel for the cross-objector.

9. It was the argument of Sri Subhash Mallapur

that the defendant has clearly denied to have executed the

agreement in favour of the plaintiff. 30.10.2008 is the

date of agreement, but on that day the defendant was not

at Kalaburagi. It is admitted that the defendant was

residing at Bengaluru and Ex.D.9 has been produced to

show that he was not in Kalaburagi on that day. The trial

Court has erroneously discarded this vital piece of

evidence produced by the defendant. It is also his

argument that the defendant was a Government Servant

and he was supposed to obtain permission from the

Government, even for selling the property. It has come in

evidence that the defendant could not obtain the

permission. This being the fact, it is highly impossible

that the defendant would have agreed to sell his property

in favour of the plaintiff by executing the agreement as per

Ex.P.1. His further argument is that all the witnesses

examined by the plaintiff do not testify to the fact that the

defendant executed the agreement. If Rs.12,00,000/- was

actually paid by the plaintiff towards part of sale

consideration, definitely, that could have been proved by

the plaintiff by producing independent document

specially, in the background of the fact that execution of

the agreement is discarded. There is no proof for payment

of Rs.12,00,000/- and also Rs.1,05,001/- by the plaintiff

to the defendant and in this view, the trial Court should

not have granted alternative relief directing the defendant

to refund Rs.13,05,001/- to the plaintiff.

10. Sri Manvendra Reddy, learned counsel for the

cross-objector, argues that Ex.D.9 does not establish the

fact that the defendant was not present at Kalaburagi on

30.10.2008. He argues that Ex.D.9 shows that on

30.08.2008, defendant was at Bengaluru, but the

agreement bears the date 30.10.2008. For this reason,

Ex.D.9 is not at all helpful to the defendant in any

manner. His further argument is that the trial Court has

clearly given a finding that the defendant executed the

agreement of sale in the presence of the witnesses which

has not been denied by the defendant. The plaintiff issued

legal notice to the defendant. The defendant issued reply

to the legal notice and in the said reply, execution of

agreement is not denied. In this view, the argument put

forth by Sri Subhash Mallapur for the first time in this

appeal that the execution of the agreement is denied by

the defendant cannot be accepted.

11. With regard to obtaining of permission, it is his

argument that the Service Rules does not require that

whenever a Government servant wants to sell his property,

he should obtain prior permission from the Government,

what is required is giving information to the Government.

In this view, the entire plea of the defendant that he could

not obtain the permission and for this reason, sale deed

could not be executed cannot be accepted. The trial Court

has erred in declining to grant the decree of specific

performance. The defendant has not pleaded hardship

and therefore, while exercising discretion, the trial Court

ought to have leaned in favour of the plaintiff to grant

decree of specific performance instead of granting the

alternative relief. Therefore, he prays for allowing the

cross-objection and dismissing the appeal.

12. In the light of the above argument, we frame

the following points for discussion:

1. Whether the trial Court has correctly held that the defendant executed the agreement of

sale and received earnest money of Rs.13,00,000/- from the plaintiff?

2. Whether the trial Court has rightly exercised discretion in denying the relief of specific performance in favour of the plaintiff and granting alternative relief of earnest money?

3. What order?

Point No.1:

13. If we read the entire written statement, the

specific case of the plaintiff is that the agreement came

into existence on 30.10.2008 at Kalaburagi. 2-3 days

before the date of the agreement, the plaintiff met the

defendant at Bengaluru and finalized the terms of the

agreement. The sale consideration was fixed at

Rs.38,00,000/- and that on 28.08.2008 she made

payment of Rs.1,05,001/-. Then, at the time of executing

the agreement, she made payment of Rs.12,00,000/-. The

written statement shows that the defendant admits to

have received Rs.1,05,001/- from the plaintiff, but with

regard to receipt of Rs.12,00,000/-, the defendant does

not in clear terms, deny to have received Rs.12,00,000/-

and only contends that payment of Rs.12,00,000/- by way

of cash appears to be fanciful because any payment

exceeding Rs.20,000/- should be made by way of cheque

and therefore, it is impossible that he would have received

Rs.12,00,000/- from the plaintiff. If the oral testimony of

P.W.1 to P.W.3 is perused, we find that the plaintiff is able

to prove execution of the agreement. Ex.P.1 is the original

agreement of sale, defendant has not denied his signature

on the agreement. In the agreement, it is clearly written

that on 30.10.2008 the plaintiff made cash payment of

Rs.12,00,000/- to the defendant. P.W.2, the broker has

given evidence that the agreement came into existence in

his presence and he saw payment of Rs.12,00,000/- by

the plaintiff to the defendant. Ex.P.2 is the receipt

executed by the defendant having received Rs.1,05,001/-.

Ex.P.3 is the legal notice where it is clearly written that

Rs.12,00,000/- was paid by the plaintiff to the defendant

on 30.10.2008. To this notice, defendant got issued reply

admitting receipt of Rs.1.05,001/-. Payment of

Rs.12,00,000/- is not denied. This shows that defendant

admitted to have received Rs.12,00,000/-. If really

defendant had not received Rs.12,00,000/-, that could

have been clearly stated in the reply notice. Added to this,

the plaintiff has produced certified copy of the FIR marked

as Ex.P.7. FIR was lodged by the defendant against one

Kanniram, a tenant in the suit property. In this FIR also,

defendant has stated very clearly that he had executed

agreement of sale undertaking to execute the sale deed

after obtaining permission from the Government. This

being the evidence, if the learned counsel for the

defendant argues now that execution of the agreement has

not been proved, it is not possible to accept it. Even if we

consider Ex.D.9, what we find is that it does not in any

way establish the fact that on 30.10.2008, the defendant

was not present at Kalaburagi. This document only shows

that on 30.08.2008, the defendant attended to his official

work at Bengaluru. It does not in any way indicate his

absence at Kalaburagi on 30.10.2008. Rightly the trial

Court has not considered Ex.D.9 and therefore, we are of

the opinion that the finding given by the trial Court that

the plaintiff was able to prove the execution of agreement

is correct. Hence, we answer point No.1 in the Negative.

Point No.2:

14. The trial Court has ascribed the reason that

the defendant was not able to execute the sale deed as he

could not obtain permission from the Government. It is

true that defendant has stated so in the written

statement and also given evidence to that effect. The law

actually does not require obtaining of permission from

the Government whenever a public servant wants to sell

the property belonging to him. At this stage, we may

refer to the Karnataka Civil Services (Conduct) Rules,

1966, in which Rule 23 (2) clearly states as below:

"(2) No Government Servant [or any member of his family] shall, except with the previous

knowledge of the prescribed authority, acquire or dispose of any immovable property by lease, mortgage, purchase, sale, gift or otherwise either in his own name or in the name of any member of his family:

Provided that the previous sanction of the prescribed authority shall be obtained by the Government Servant if any such transaction is.-

(i) with a person having official dealings with the Government Servant; or

(ii) otherwise than through a regular or reputed dealer:

[Provided further that nothing in this sub-rule shall apply to the transactions entered into by a member of the family of the Government Servant out of his or her own funds(including gifts, inheritance, etc.), as distinct from the funds of the Government Servant himself/herself, in his or her own name and in his or her own right.]"

15. If we read sub-rule (2), what we understand is

that the Government servant can sell property giving

information to the Government, that means obtaining of

permission is not necessary. Permission is to be obtained

only when the Government servant transacts with a

person who has official dealings with the Government

servant. It is not the case of the defendant that the

plaintiff was having official dealings with the Government.

Probably the trial Court without being aware of the

position of law might have come to that conclusion.

16. We may also observe here that the defendant

has not pleaded hardship in case specific performance is

granted. This aspect should have been taken into

consideration by the trial Court. The plaintiff has made

payment of Rs.13,00,000/-. The total consideration is

Rs.38,00,000/-. He has clearly stated that he is ready to

make payment of balance of Rs.25,00,000/- and perform

his part of the contract. Evidence in this regard is also

available. Taking this aspect into consideration, the trial

Court should have granted the relief of specific

performance in favour of the plaintiff. We find that the

conclusion of the trial Court to deny the relief of specific

performance and to grant the alternative relief is not in the

background of actual facts and circumstances. Therefore,

we answer this point in the Negative.

Point No.3:

17. From the above discussion, we come to

conclusion that the appeal filed by the defendant deserves

to be dismissed and the cross-objection deserves to be

allowed. Therefore, the following:

ORDER

The Appeal is dismissed without cost.

The Cross-objection is allowed with cost.

The judgment and decree dated 18.04.2016 in

O.S.No.182/2011 passed by the Principal Senior Civil

Judge, Kalaburagi is modified.

The suit of the plaintiff is decreed. The defendant is

hereby directed to execute the sale deed in favour of the

plaintiff by receiving from him the balance of

Rs.25,00,000/- and deliver the possession of the suit

property to him.

The plaintiff is hereby directed to deposit balance

sale consideration of Rs.25,00,000/- within three months

from today in the trial Court and after deposit being made

by the plaintiff, the defendant shall execute the sale deed.

If the defendant fails to execute the sale deed, the plaintiff

can obtain the sale deed and possession of the suit

property through the process of Court.

Sd/-

JUDGE

Sd/-

JUDGE

RSP