Karnataka High Court
Shri. Shankar Laxman Chalavetkar vs Shri. Madhukar S/O. Appaji Jadhav on 21 October, 2024
-1-
NC: 2024:KHC-D:15045-DB
RFA No. 100492 of 2018
IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
DATED THIS THE 21ST DAY OF OCTOBER, 2024
PRESENT
THE HON'BLE MR. JUSTICE SREENIVAS HARISH KUMAR
AND
THE HON'BLE MR. JUSTICE T. G. SHIVASHANKARE GOWDA
REGULAR FIRST APPEAL NO.100492 OF 2018 (SP)
BETWEEN:
1. SHRI SHANKAR LAXMAN CHALAVETKAR,
AGE: 60 YEARS, OCC: AGRICULTURE,
R/O. H.NO.4, MARUTI GALLI BOLE, SULAGE,
UCHAGAON, BELAGAVI-591108.
2. SMT. SHARADA SHANKAR CHALAVETKAR,
AGE: 53 YEARS, OCC: AGRICULTURE,
R/O. H.NO.4, MARUTI GALLI BOLE, SULAGE,
UCHAGAON, BELAGAVI-591108.
...APPELLANTS
(BY SRI RAMESH N. MISALE, ADVOCATE)
AND:
MANJANNA SHRI MADHUKAR S/O. APPAJI JADHAV
E AGE: 53 YEARS, OCCUPATION : AGRICULTURE,
R/O. JADHAV NAGAR, UCHAGAON,
Digitally signed by
MANJANNA E
BELAGAVI-591108.
Location: High Court of
Karnataka, Dharwad Bench ...RESPONDENT
Date: 2024.10.24 16:42:04
+0530 (BY SRI M.N. BIKKANNANAVAR AND
SRI SUNIL G. KAKATKAR, ADVOCATES)
THIS RFA IS FILED UNDER SECTION 96 OF THE CODE OF
CIVIL PROCEDURE PRAYING TO, ALLOW THE APPEAL AND SET ASIDE
THE JUDGMENT AND DECREE PASSED BY THE LEARNED I
ADDITIONAL SENIOR CIVIL JUDGE BELAGAVI IN O.S.NO.249/2015
DATED 25.08.2018 BY DECREEING THE SUIT WITH COSTS
THROUGHOUT AND ETC.,
-2-
NC: 2024:KHC-D:15045-DB
RFA No. 100492 of 2018
THIS APPEAL, COMING ON FOR DICTATING JUDGMENT, THIS
DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: THE HON'BLE MR. JUSTICE SREENIVAS HARISH KUMAR
AND
THE HON'BLE MR. JUSTICE T. G. SHIVASHANKARE GOWDA
ORAL JUDGMENT
(PER: THE HON'BLE MR. JUSTICE SREENIVAS HARISH KUMAR)
This appeal is filed by the plaintiffs in O.S.No.249/2015
on the file of I Additional Senior Civil Judge, Belagavi. The
plaintiffs' suit is for specific performance in respect of 14
guntas of land out of 2 acres 37 guntas in Sy.No.647 of
Uchagaon village, Belagavi (hereinafter referred to as "suit
property" for the sake of convenience). Since by judgment
dated 25.08.2018 the suit came to be dismissed, the
plaintiffs have approached this Court.
2. Briefly stated the material facts are that on
29.12.2011, the plaintiffs entered into an agreement with
the defendant for purchasing the suit property for a
consideration of Rs.2,00,000/- per gunta i.e., Rs.28,00,000/-
for 14 guntas. On the date of agreement the plaintiffs made
payment of Rs.10,00,000/- to the defendant. It was agreed
between the parties that the balance was to be paid on or
NC: 2024:KHC-D:15045-DB
before 15.01.2013 for completion of the sale transaction and
that defendant agreed to obtain 11E sketch from the Survey
Department and Raitawa conversion, and clear the dues at
Karnataka Vikas Grameena Bank ('KVG Bank" for short).
Thereafter on 07.06.2012 there came in existence a
supplementary agreement for sale in respect of the same
property because the defendant wanted a further sum of
Rs.5,00,000/- to be paid to him. Plaintiffs made payment of
Rs.5,00,000/- by way of two cheques, one for Rs.1,00,000/-
and another for Rs.3,00,000/- and cash of Rs.1,00,000/-.
Since the defendant did not show any interest to execute the
sale deed by obtaining 11E sketch and Raitawa conversion
and clearing the dues at KVG Bank, the plaintiffs called upon
the defendant by issuing a notice to execute the sale deed. It
is stated that defendant approached the plaintiffs and
requested them not to take any legal action and he assured
that he would complete the formalities of executing the sale
deed. The plaintiffs state that defendant demanded a further
sum of Rs.60,000/- when he fell ill and that the plaintiffs
made payment of that amount also. Even thereafter
NC: 2024:KHC-D:15045-DB
defendant did not show any interest and therefore the
plaintiffs caused one more legal notice issued to the
defendant on 22.07.2015. The defendant received the notice,
but did not reply and did not execute the sale deed also.
Therefore, the suit came to be filed.
3. In the written statement, the specific defence is that
he did not agree to sell the suit property to the plaintiffs,
rather it was a document evidencing loan transaction
between him and the plaintiffs. He was in need of money to
clear his liabilities and therefore sought financial assistance
from the 1st plaintiff and at that time, the 1st plaintiff
obtained a document from him in the style of an agreement
of sale making use of his illiteracy. He stated that since he
was in dire need of money, he obliged the plaintiffs and put a
signature on a document. In the same way, he denies the
supplementary agreement dated 07.06.2012.
4. The 1st plaintiff adduced evidence as PW.1 and
examined another witness as PW.2 and produced the
documents as per Exs.P.1 to P.5. The defendant did not
choose to adduce evidence from his side.
NC: 2024:KHC-D:15045-DB
5. Based on the pleadings the Trial Court struck six
issues. On appreciating the evidence, the Trial Court
dismissed the suit giving the following findings;
i) The plaintiffs have not produced documents to show
that on or about 29.12.2011, they had a sum of
Rs.9,50,000/-, so that they could make that
payment by way of cash. There is no explanation as
to how, they would arrange for that sum.
ii) No document is produced to show that payment of
Rs.50,000/- was made by way of cheque.
iii) PW.1 only made the payment, it is not
understandable as to why the name of the 2nd
plaintiff is mentioned in the agreement.
iv) Plaintiffs did not enquire the defendant about the
latter's financial difficulty instead they enquired
PW.2, who is the brother of defendant. This appear
to be quite strange.
NC: 2024:KHC-D:15045-DB
v) Agreement appears to have been executed without
meeting of minds of the parties. The evidence of
PW.2 is not helpful to hold that the agreement came
into existence.
vi) Ex.P.2 is not believable for the reason that in the
said document it is written that Rs.5,00,000/- was
paid on the date of Ex.P.2 itself but actual payment
was not made on that day and in this view Ex.P.2
appears to be a created one. For these reasons both
Exs.P.1 and P.2 are not proved.
6. An application as per I.A.No.3/2018 has been filed
on behalf of the appellants for producing some documents by
way of additional evidence.
7. We have heard the arguments of Sri Ramesh N.
Misale learned counsel for the appellants and Sri M.N.
Bikkannanavar, learned counsel for the respondent.
8. It is the argument of Sri Ramesh Misale that
plaintiffs produced the original agreement of sale dated
29.12.2011 and the supplementary agreement of sale dated
NC: 2024:KHC-D:15045-DB
07.06.2012. To prove the execution of agreement, the
plaintiffs examined the defendant's brother i.e., PW.2, whose
evidence is not at all discredited by the defendant. PW.2 has
clearly stated that entire earnest money of Rs.10,00,000/-
was paid in his presence to the defendant. Rs.9,50,000/-
was paid by way of cash, and a cheque was issued for the
balance. This cheque was encashed by the defendant.
Similarly when the supplementary agreement was executed
on 07.06.2012, Rs.4,00,000/- was paid by two post dated
cheques and cash of Rs.1,00,000/- was paid. In the plaint
itself, it is clearly stated that these payments were not made
on 07.06.2012. For this reason, there was no reason for the
Trial Court to opine that Ex.P.2, the supplementary
agreement was to be disbelieved for the reason that
payment was not made as has been stated in it. These
payments have not been denied specifically and when PW.1
was cross-examined, except a suggestion that payments are
not made, the evidence of PW.1 is not in any way
impeached. Similarly Rs.60,000/- was paid to the defendant
when he fell ill. This is also not denied by the defendant.
NC: 2024:KHC-D:15045-DB
Moreover in the written statement itself defendant has
admitted that he was in dire need of money and therefore he
wanted to sell the suit property. Without noticing this
admission the Trial Court has given a finding that the
plaintiffs have not been able to prove that defendant was in
need of money. This itself shows that, the facts are not
properly marshaled by the Trial Court.
9. Learned counsel argued that in proof of payments
made, certain documents are produced along with
application under Order XLI Rule 27 of CPC. The documents
are very necessary to establish that the plaintiff made
payments and therefore the said application is to be allowed.
10. He further argued that the defendant had to obtain
11E sketch and Raitawa conversion, and clear the dues at
KVG Bank. Though the plaintiff was always ready and willing
to perform his part of contract, the defendant failed to
perform his part of contract. Noticing that the defendant was
not interested and he was postponing the execution of the
sale deed without any valid reason, the plaintiff got issued
two notices, which were not replied by the defendant.
NC: 2024:KHC-D:15045-DB
Instead of comprehending this entire evidence in this way,
the Trial Court would substitute its own reasons, dehors the
evidence and hence this appeal deserves to be allowed and
defendant directed to execute the sale deed by receiving
balance of sale consideration which the plaintiffs are ready to
pay.
11. Per contra Sri M.N.Bikkannanavar would argue that
the suit property did not belong to the defendant exclusively,
it was a joint family property. PW.1 has admitted that the
defendant had no exclusive right over the property when he
was examined. In this view of the matter, the defendant
would not have applied for 11E sketch, unless partition had
taken place. The Trial Court has rightly held that there is no
proof for making payment of earnest money and for all these
reasons the appeal is devoid of merits and therefore it is to
be dismissed. In support of his argument, he relied upon a
judgment of the Hon'ble Supreme Court in the case of
MORESHAR YADAORAO MAHAJAN VS. VYANKATESH SITARAM
BHEDI (D) THR. LRS. AND OTHERS (Civil Appeal Nos.5755-
5756/2011).
- 10 -
NC: 2024:KHC-D:15045-DB
12. His further submission is that since defendant did
not adduce evidence, the matter may be remanded to the
Trial Court to enable the defendant to adduce evidence.
13. We have considered the points of arguments and
perused the entire evidence. The points that arise for
discussion are:
1. Is the finding of the Trial Court that Exs.P.1 and
P.2 are not properly executed and they are not
valid agreements, correct?
2. Is the plaintiffs entitled to relief of specific
performance or alternative relief of refund of
earnest money with interest?
14. POINT NO.1 : At the outset we may opine that the
findings recorded by the Trial Court are incorrect. The Trial
Court has failed to comprehend the facts and evidence. It is
the clear case of the plaintiffs that the defendant being an
absolute owner of the suit property entered into an
agreement with them under Ex.P.1 on 29.12.2011 and on
the same day they made payment of Rs.10,00,000/-, out of
which Rs.9,50,000/- was paid by cash and balance of
- 11 -
NC: 2024:KHC-D:15045-DB
Rs.50,000/- was paid by way of a cheque. Then there came
into existence a supplementary agreement on 07.06.2012 as
per Ex.P.2. The plaintiffs have stated that the defendant was
in need of money and that was a reason for his for deciding
to sell the suit property to the plaintiffs. This is actually not
disputed by the defendant in his written statement. If the
written statement is read, in para 3 of the written statement
it is clearly stated by defendant that he and his family
members were in dire necessity for money due to financial
difficulties. When there is a clear admission by defendant in
the written statement, ignoring this admission, the Trial
Court were to hold that the plaintiffs did not ascertain about
the difficulties from defendant and therefore the agreement
becomes dis-believable, it is nothing but an erroneous
finding. Added to this PW.2 is none other than the brother of
defendant and he clearly states that he was very much
present at the time when Ex.P.1 came into existence and the
earnest money was paid in his presence. PW.1 has stated
about Ex.P.2, the supplementary agreement dated
07.06.2012 and about this supplementary agreement also
- 12 -
NC: 2024:KHC-D:15045-DB
PW.2 corroborates the evidence of PW.1. The entire cross-
examination of PWs.1 and 2 is perused, a clear inference can
be drawn that both of them are not discredited, only general
suggestions are given to them in regard to payments which
are all denied by them. It is to be noted here that in the
plaint itself it is stated very clearly in para 4 that the
defendant approached the plaintiffs with a request for further
payment of Rs.5,00,000/- towards part of sale consideration
stating that he wanted money for some reason and he was
ready to execute a supplementary deed of agreement. It is
also stated that the plaintiffs agreed to make that payment
within two months. The supplementary agreement was
executed on 07.06.2012 but the payments were made
subsequently. On 14.07.2012 plaintiffs issued two post dated
cheques drawn on Maratha Co-Operative Bank one for
Rs.1,00,000/- and another for Rs.3,00,000/-. On 16.08.2012
plaintiffs made further payment of Rs.1,00,000/-. If this is
what is stated in the plaint, the Trial Court would disbelieve
this payment giving reason that these payments were not
made on the day when Ex.P.2 came into existence. In fact,
- 13 -
NC: 2024:KHC-D:15045-DB
there is no specific denial of these payments in the written
statement. It is to be noted here that the defendant does not
deny execution of Ex.P.1 and Ex.P.2, his contention is that
they are documents which would evidence loan transaction.
In this event, there was no need for the plaintiff to prove
execution of Exs.P.1 and P.2, the burden lay on the
defendant in accordance with Section 102 of the Evidence
Act to prove that those two documents did not come into
existence in connection with sale transaction, instead in
relation to a loan transaction. If he failed, the plaintiffs'
version is to be accepted. The Trial Court has lost sight of
this aspect of the matter. If really Exs.P.1 and P.2 are not
agreements of sale, the defendant should have entered the
witness box and given evidence, which he failed and this
aspect has been ignored by the Trial Court. Now if Exs.P.1
and P.2 are perused, a clear inference can be drawn that
actually they were in relation to sale of the suit property in
favour of the plaintiffs. If they were not sale agreements
there was no need for mentioning obtaining of 11E sketch,
Raitawa conversion and clearance of loan at KVG Bank. If
- 14 -
NC: 2024:KHC-D:15045-DB
Ex.P.1 contains all these stipulations it means that it was an
agreement of sale. It also shows payment of earnest money
of Rs.10,00,000/- on the day it came in existence. Ex.P.2
also clearly shows that it was in connection with Ex.P.1
further payment of Rs.5,00,000/- was made. As regards
payment of Rs.60,000/- defendant appears to have not
disputed specifically. Therefore, the plaintiffs made total
payment of Rs.15,60,000/- to the defendant. In view of this
finding, it may be stated that it is not necessary to allow
I.A.No.3/2018 filed under Order XLI Rule 27 of CPC. So our
conclusion is that a contract did come into existence and the
defendant agreed to sell the suit property for sale
consideration of Rs.2,00,000/- per gunta to the plaintiffs.
15. It is argued vehemently by Sri
M.N.Bikkannanavar that defendant was not the absolute
owner in view of the fact that there had not taken place
partition between the defendant and his brothers and
therefore the defendant alone could not have sold the
property. It is a well settled principle that in a suit for
specific performance, the necessary parties are only parties
- 15 -
NC: 2024:KHC-D:15045-DB
to the agreement or their representatives in accordance with
Sections 15 and 19 of the Specific Relief Act. If at all
defendant is not the absolute owner in view of partition
between him and his brothers having not taken place, there
is no impediment for one of the brothers selling his
undefined share. Moreover the pleadings indicate that
defendant was the absolute owner of the suit property. This
is fortified by none other than PW.2, the own brother of
defendant who has stated very clearly that the suit property
belongs to his brother absolutely. Actually in a suit for
specific performance filed by the purchaser against the
seller, this aspect need not be discussed because if the
purchaser is ready to purchase the property from a person
having defective title, he runs the risk. Suit for specific
performance cannot be converted into a suit for title. For this
reason, the judgment of the Supreme Court in MORESHAR
YADAORAO MAHAJAN'S case cited supra is not applicable in
the context.
16. If all these aspects are considered, we have to
state unhesitatingly that the conclusions drawn by the Trial
- 16 -
NC: 2024:KHC-D:15045-DB
Court that Exs.P.1 and P.2 are not properly executed cannot
be accepted at all. In fact by executing Exs.P.1 and P.2, the
defendant did agree for selling the suit property in favour of
the plaintiffs. The Trial Court has commented as to why
plaintiff no.2 should have been made a party when entire
payment was made by the 1st plaintiff. If payment is made
by one of the parties to the agreement it cannot be a reason
for doubting entire document. Payment can be made by any
one of the parties to the agreement. Therefore we have to
answer point no.1 in the negative.
17. Point No.2 : The plaintiffs have stated that they
were ready and willing to perform their part of contract. The
balance payable was only Rs.12,40,000/-. In fact he issued
two legal notices as evidenced by Exs.P.3 and 4. It is to be
stated that defendant did not reply to these notices. The
other requirements, i.e., obtaining of 11E sketch and
Raitawa conversion and clearance of loan at KVG Bank were
on the defendant and the Plaintiffs had nothing to do with
these requirements. Therefore, the evidence actually shows
that the plaintiffs were ready and willing to perform their
- 17 -
NC: 2024:KHC-D:15045-DB
part of contract. But while arguing it was brought to our
notice that the defendant has already sold the property in
favour of third party during pendency of the appeal. It is not
for the reason that the property has been sold, but for the
reason that sale cannot be completed without obtaining 11E
sketch, we are of the opinion that the plaintiffs can be
granting alternative relief.
18. Sri Ramesh Misale submitted that when execution
petition is filed, the Executing Court can give direction to
concerned officers to issue 11E sketch and Raitawa
conversion and therefore a decree for specific performance
can be granted. In this regard it is to be stated that the
Court cannot issue such directions to the concerned officers
and monitoring those compliances is out of scope of decree.
In fact, in such a circumstance appropriate relief can be
granted. The plaintiffs have claimed alternative relief in the
plaint and for this reason, we can direct the defendant to
repay earnest money of Rs.15,60,000/- received by him
from the plaintiffs. The plaintiffs are of-course entitled to
interest. The Trial Court should have applied its mind to
- 18 -
NC: 2024:KHC-D:15045-DB
refund the earnest money having regard to the facts and
circumstances of the case. Therefore, we proceed to pass the
following:
ORDER
i. Appeal is allowed.
ii. The judgment of the Trial Court is set aside
and suit is decreed holding that the plaintiffs
are entitled refund of Rs.15,60,000/- with
interest at the rate of 9% per annum from
the date of suit till date of realization.
Plaintiffs are also entitled to costs of the suit
and the appeal.
iii. I.A.No.3/2018 consequently stands
dismissed.
Sd/-
(SREENIVAS HARISH KUMAR)
JUDGE
Sd/-
(T. G. SHIVASHANKARE GOWDA)
JUDGE
EM
