Karnataka High Court
Sri L Muthuraj vs Smt Bhagya on 21 July, 2025
Author: Jyoti Mulimani
Bench: Jyoti Mulimani
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RFA No. 616 of 2018
HC-KAR
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 21ST DAY OF JULY, 2025
BEFORE
THE HON'BLE MS. JUSTICE JYOTI MULIMANI
REGULAR FIRST APPEAL NO. 616 OF 2018 (SP)
BETWEEN:
SRI. L.MUTHURAJ
S/O H.M.LINGEGOWDA,
AGED ABOUT 44 YEARS,
R/A #667, NEXT TO MARKET,
BEHIND MOSQUE, MANDYA CITY-571 401.
...APPELLANT
(BY SRI. DEEPAK., ADVOCATE FOR
SRI. R.VYBHAV., ADVOCATE)
AND:
1. SMT. BHAGYA
W/O LATE H.C.CHOWDAIAH,
AGED ABOUT 52 YEARS,
BOOTHA HOSUR VILLAGE,
KOTHATHI HOBLI,
Digitally signed by
PREMCHANDRA M R MANDYA TALUK AND DISTRICT-571 403.
Location: HIGH
COURT OF
KARNATAKA 2. SRI. H.CHANDAN
S/O H.C.CHOWDAIAH,
AGED ABOUT 40 YEARS,
R/AT BOOTHA HOSUR VILLAGE,
KOTHATHI HOBLI,
MANDYA TALUK AND DISTRICT-571 403.
3. SRI. H.C.SAGAR
S/O H.C.CHOWDAIAH,
AGED ABOUT 35 YEARS,
R/AT BOOTHA HOSUR VILLAGE,
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RFA No. 616 of 2018
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KOTHATHI HOBLI,
MANDYA TALUK AND DISTRICT-571 403.
...RESPONDENTS
(BY SRI. PRASANNA., ADVOCATE)
THIS REGULAR FIRST APPEAL IS FILED UNDER SECTION
96 OF THE CODE OF CIVIL PROCEDURE.
THIS REGULAR FIRST APPEAL IS LISTED FOR FINAL
HEARING, THIS DAY, THE JUDGMENT WAS DELIVERED AS
UNDER:
ORAL JUDGMENT
Sri.Deepak, counsel on behalf of Sri.R.Vybhav., for the
appellant and Sri.H.S.Shankar, counsel on behalf of
Sri.Prasanna, for the respondents have appeared in person.
2. This is an appeal from the Court of Prl. Senior Civil
Judge and CJM, Mandya.
3. For convenience's sake, the parties are referred to
as per their status and rankings before the Trial Court.
4. The plaint averments are these:
The defendants are the absolute owners in possession of
the suit schedule property. The defendants needed money to
repay the hand loans borrowed by the first defendant and also
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to cover the education expenses of the third and fourth
defendants, hence, they agreed to sell the property in favor of
the plaintiff on 08.01.2014 for a valuable consideration of
Rs.12,00,000/- and on the same day, towards part of sale
consideration, they received Rs.10,00,000/- as earnest money
out of sale consideration from the plaintiff before the Sub-
Registrar, Mandya and agreed to execute the sale deed and to
hand over the possession of the suit schedule property in favor
of the plaintiff within two years from that date, by receiving the
balance sale consideration of Rs.2,00,000/- from the plaintiff.
At the time of executing the sale agreement, the
defendants agreed to submit the E-katha of the scheduled
property to produce it before the Sub-Registrar for the
registration of the absolute sale deed; however, they did not
facilitate its production or come forward to perform their part of
the contract. Hence, the plaintiff issued a legal notice on
19.11.2015 calling upon the defendants to execute the sale
deed, which was duly served on them, but in vain. Hence, the
plaintiff was compelled to seek refuge in the Court of law and
filed a suit seeking the relief of Specific Performance.
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After service of the suit summons, defendant No.1
appeared through his counsel and filed a written statement and
denied the plaint averments. He contended that the plaintiff
was known to him and hence, for legal necessity, he had
obtained a loan of Rs.5,00,000/- from the plaintiff and had
agreed to repay the same with interest at the rate of 1% per
month and on the same day, he executed the sale agreement.
The plaintiff, for the security of the said loan amount, had
obtained a sale agreement. He also stated that he has paid the
loan amount with interest of Rs.4,00,000/- and requested the
plaintiff to receive the balance amount and cancel the sale
agreement, but the plaintiff did not cancel the documents. It is
further contended that he never agreed to sell the suit property
for a meager sum, and the suit property is an ancestral joint
family property worth more than Rs.25,00,000/-. Among other
grounds, he prayed for dismissal of the suit.
Based on the pleadings, the Trial Court framed issues.
The plaintiff examined himself as PW1, and two witnesses were
examined as PW2 and 3 and produced seven documents
marked as Ex.P.1 to Ex.P.7. The defendants neither adduced
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oral evidence nor furnished documentary evidence. The Trial
Court vide Judgment dated 28.11.2017 dismissed the suit.
Hence, the plaintiff has filed the present appeal under Section
96 of CPC.
5. Counsel Sri.Deepak, for the appellant, submits that
the Judgment and decree of the Trial Court are contrary to law
and opposed to the oral and documentary evidence on record.
Next, he submits that the Trial Court has erred in holding
that Ex.P.1 is a loan agreement executed by defendants for the
loan availed by them from the plaintiff and not an agreement
for sale. He submits that the agreement was registered before
the Sub-Registrar, and the defendants received Rs.10,00,000/-
as advance for the sale of schedule property and affixed their
thumb impression in the presence of the Sub-Registrar.
A further submission is made that the Trial Court has
failed to look into the contents of Ex.P.1 Agreement for sale
dated 08.01.2014 and give effect to the intent of the party as
specified in the agreement. It is also submitted that the
defendants themselves admitted to having executed the
agreement for sale in favor of the plaintiff in the written
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statement. The defendants have failed to discharge the burden
by leading evidence to prove that the agreement is a loan
agreement.
Counsel vehemently contended that the Trial Court erred
in concluding that the agreement for sale is a loan agreement
on the basis that the plaintiff was in the business of money
lending. It is submitted that the Court erred in not giving effect
to the recital and contents of Ex.P.1, but erroneously held that
the agreement to be a loan agreement based on the
depositions of PW1.
Lastly, he submits that viewed from any angle, the
Judgment of the Trial Court is untenable and the same is liable
to be set aside. Counsel, therefore, submits that the appeal
may be allowed and the plaintiff's suit may be decreed.
6. Sri.H.S.Shankar, counsel for the respondents,
justified the Judgment of the Trial Court.
Next, he submits that the plaintiff was a moneylender and
the defendants needed money; hence, for security purposes,
they executed an agreement for sale.
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A further submission is made that the suit schedule
property is an ancestral joint family property, and the
defendants did not execute an agreement for sale and never
agreed to execute a sale deed within two years.
Counsel vehemently contended that in the plaint, the
schedule property is described as a vacant site; however, in the
alleged agreement for sale, it is shown as a house measuring
40 X 50 ft.
Urging other contentions, lastly, he submits that the
appellant has not made any grounds to interfere with the
Judgment and Decree of the Trial Court. Hence, the appeal may
be dismissed. Counsel placed reliance on the decision in
H.M.MAHADEVAPPA AND ANOTHER VS. P. LOKESHA -
R.S.A.NO.139/2018, disposed on 28.06.2024.
7. Heard the arguments and perused the appeal
papers and the records with care.
8. The following points would arise for consideration:
1) Whether there is an offer by the defendants
to sell the suit schedule property in favor of the
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plaintiff, and acceptance by the plaintiff to purchase
the suit schedule property and whether there is a
binding contract between the plaintiff and the
defendants?
2) Whether the plaintiff is entitled to the relief
of specific performance?
This Regular First appeal is filed under Section 96 of the
CPC, and this Court is the final Court of facts, which is expected
to reassess the entire oral and documentary evidence on
record. The facts are sufficiently said and do not require
reiteration. In this case, the plaintiff sued to enforce the
specific performance of a Contract to execute a conveyance in
respect of the suit property.
The case of the defendants, as put forth before the Trial
Court, is that they needed money since they knew the plaintiff
hence, they had obtained a loan of Rs.5,00,000/- from him,
agreeing to repay the same with interest @ 1% per month and
on the very same day, they executed the sale agreement. To
be precise, the defendants contended that they needed money
to clear the hand loans, to manage the household expenses,
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and offered to sell the suit schedule property, and the plaintiff
agreed to purchase the same for a valuable consideration.
Before I answer the points for consideration, I propose to
say a few words on the simple law of contracts.
In the laws of contracts, agreements are made either by
words of mouth or in writing. To determine whether, in any
given case, it is reasonable to infer the existence of an
agreement, it has long been usual to employ the language of
offer and acceptance. In other words, the Court examines all
the circumstances to see if one party be assumed to have made
a firm 'offer' and if the other may likewise be taken to have
'accepted' that offer. These complementary ideas present a
convenient method of analyzing a situation, provided that they
are not applied too literally and that facts are not sacrificed to
phrases.
The first task of the plaintiff is to prove the presence of a
definite offer made either to a particular person or, as in
advertisements of rewards for services to be rendered, to the
public at large. Proof of an offer to enter into legal relations
upon definite terms must be followed by the production of
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evidence from which the Courts may infer an intention by the
offeree to accept that offer. There may be said to be three
basic essentials to the creation of a contract: agreement,
contractual intention and consideration. To determine whether
the parties have reached an agreement, it is customary to
inquire whether a definite offer has been made by one party
and whether the other has accepted that offer.
9. Counsel Sri.H.S.Shankar, in presenting his
arguments, strenuously urged that the plaintiff was a
moneylender and had lent money to one Mr.Narayan and
Mr.Nagaraj. He drew the attention of the Court to the cross-
examination of PW1. While arguing the case, counsel for the
defendants contended that the defendants never intended to
sell the suit schedule property to the plaintiff; as such, there is
no offer by the defendants to sell the suit schedule property to
the plaintiff.
By way of reply to this contention, Sri.Deepak, counsel
for the plaintiff, submits that the reference made by counsel for
the defendants has no relevance because the plaintiff had filed
a suit for recovery of money against Mr.Narayan and was
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constrained to initiate proceedings for a Cheque bounce case
against Mr.Nagaraj.
Bearing the fundamental principles of law of contracts in
mind, let me determine whether there is a valid offer and
acceptance in the present case.
To see whether there is an offer and acceptance, let me
consider the material evidence on record. The plaintiff was
examined as PW1, and he states that the defendants executed
an agreement for sale, and he was always ready and willing to
perform his part of the contract. One Mr.P.Manju - a person
known to both the plaintiff and defendants was examined as
PW2, and he also states that the defendants, to meet their
family needs, executed an agreement for sale in favour of the
plaintiff. Except for filing the written statement and cross-
examining PW1, the defendants did not enter the witness box
to disprove the plaintiff's case.
Ex.P.1 is the Agreement for Sale dated 08.01.2014.
Perused the document and contents with care. From the
perusal of the document, i.e., Ex.P.1, the nomenclature of the
document is as under:
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"±ÀÄzÀÝ PÀæAiÀÄzÀ M¥ÀàAzÀzÀ PÀgÁgÀÄ ¥ÀvÀæ"
In the document, it is stated as under:
"PÀæªÀĪÉãÉAzÀgÉ µÉqÀÆå¯ï£À°è £ÀªÀÄÆzÀÄ ªÀiÁrgÀĪÀ ¸ÀévÀÄÛ
ªÉÄîÌAqÀ £ÀªÀÄä°è ºÉZï.¹.ZËqÀAiÀÄå DzÀ £À£ÀUÉ ¦vÁæfðvÀªÁV
§A¢gÀvÀPÀÌ D¹ÛAiÀiÁVgÀÄvÀÛzÉ. £ÀAvÀgÀ ¸ÀzÀj ¸ÀéwÛUÉ ¥ÁªÀw ªÀiÁqÀ¨ÉÃPÁzÀ
PÀAzÁAiÀĪÀ£ÀÄß ¸ÀA§AzsÀ¥ÀlÖ ¸ÀÆ£ÀUÀºÀ½î UÁæªÀÄ¥ÀAZÁ¬Äw PÀbÉÃjUÉ
¥ÁªÀw ªÀiÁr £À£Àß ºÉ¸ÀjUÉ SÁvÉ ªÀUÁðªÀuÉ ªÀiÁr¹PÉÆAqÀÄ F §UÉÎ
£ÀªÀÄÆ£É-9 ªÀÄvÀÄÛ £ÀªÀÄÆ£É-11 £ÀÄß ¸ÀºÀ ¥ÀqÉzÀÄPÉÆArgÀÄvÉÛãÉ.
F jÃwAiÀiÁV £ÀªÀÄä ¸ÀA¥ÀÆtð ºÀPÀĄ̈ÁzsÀåvÉUÉ M¼À¥ÀlÄÖ ºÁ°
£ÀªÀÄä ¸Áé¢üãÁ£ÀĨsÀªÀzÀ°ègÀĪÀ ¸ÀévÀÛ£ÀÄß £ÁªÀÅ £ÀªÀÄä zÀgÀzÀÄ ¤«ÄvÀÛöåªÁV
CAzÀgÉ ªÀÄĨsÉÊ ¸Á®UÀ¼À£ÀÄß wÃgÀĪÀ½ ªÀiÁqÀ®Ä ºÁUÀÆ UÀȺÀPÀÈvÀåzÀ
RaðUÁV ¸ÀºÀ ¤ªÀÄUÉ £ÀUÀzÀÄ UËgÀߪÉÄAmï ZÀ¯ÁªÀuÉ gÀÆ.12,00,000/-
(ºÀ£ÉßgÀqÀÄ ®PÀë) gÀÆ¥Á¬ÄUÀ½UÉ ±ÀÄzÀÝ PÀæAiÀÄPÉÌ PÉÆqÀ®Ä M¦à F §UÉÎ
CqÁé£ÁìV F PÀgÁgÀÄ ¥ÀvÀæ jf¸ÀÖgï ªÉÃ¼É ¸À¨ï jf¸ÁÖçgï gÀªÀgÀ
¸ÀªÀÄPÀëªÀÄ ¤«ÄäAzÀ £ÀUÀzÁV gÀÆ.10,00,000/- (ºÀvÀÄÛ ®PÀë)
gÀÆ¥Á¬ÄUÀ¼À£ÀÄß £ÀUÀzÁV ¥ÀqÉzÀÄPÉÆArgÀÄvÉÛêÉ. E£ÀÄß G½PÉAiÀiÁzÀ
gÀÆ.2,00,000/- (JgÀqÀÄ ®PÀë) gÀÆ¥Á¬ÄUÀ¼À£ÀÄß F¯ÁUÁAiÀÄÄÛ
2(JgÀqÀÄ) ªÀµÀðUÀ¼À ªÁ¬ÄzÉ M¼ÀUÁV ¤ÃªÀÅ C¥ÉÃPÉë¥ÀlÖ ¢£ÀzÀAzÀÄ
¤ÃªÀÅ PÉüÀĪÀ ¥ÀPÀÌ zÁR¯Áw ¸ÀªÉÄÃvÀªÁV §AzÀÄ ¤ªÀÄUÁUÀ°Ã CxÀªÁ
¤«ÄäAzÀ C¢üPÁgÀ ¥ÀqÉzÀÄ ¤ÃªÀÅ ºÉýzÀªÀjUÁUÀ°Ã PÀæªÀĪÁzÀ PÀæAiÀÄ¥ÀvÀæ
§gɹ jf¸ÀÖgï ªÀiÁr¹PÉÆqÀĪÁUÀ ¤«ÄäAzÀ £ÀUÀzÁV ¥ÀÀqÉzÀÄPÉƼÀÄîvÉÛêÉ."
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It is seen from the contents of the document, i.e., Ex.P.1,
there is an offer by the defendants to sell the suit schedule
property to the plaintiff and acceptance by the plaintiff to
purchase the same from the defendants. The defendants did
not step into the witness box. From the material evidence on
record it is seen that there is sufficient interaction between the
plaintiff and the defendants, and there is a meeting of minds
between the parties before the formation of the contract. It is
perhaps well to observe that the evidence is sufficient to prove
that the defendants intended to sell the property and offered to
sell the same to the plaintiff. If the Court evaluates the material
on record, it can be safely held that there is proof of the
intention of creating a legal relationship between the plaintiff
and the defendants. Accordingly, this Court thinks that there is
an offer and acceptance, and there is a binding contract
between the plaintiff and the defendants. The contention
regarding money lending and loan agreement must necessarily
fail, since a perusal of the cross-examination of PW1 reflects
that a suggestion was made to the plaintiff that he is a
moneylender, but the same has been denied by the plaintiff.
Moreover, what is required to be looked into is whether there is
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an offer and acceptance, and whether the defendants executed
an agreement for sale. Hence, drawing a presumption and
concluding that it is a loan transaction is wrong. The other
contention about the ancestral property and the misdescription
of the property must also necessarily fail because the
defendants were aware of the nature of the property and have
agreed to sell the same; the description of the property is
correctly described in the plaint schedule.
Let me answer the second point. The law is well-settled
that the plaintiff must aver as well as prove his readiness and
willingness to perform his part of the obligation. The distinction
between readiness and willingness is that the former has
reference to financial capacity, and the latter to the conduct of
the plaintiff wanting specific performance. While 'willingness' is
merely a mental process, 'readiness' is something to do with
translating that will into action and is preceded by the
necessary preparation of being in a position to be ready. In
other words, while 'willingness' may be something to do mainly
with a person's mental process to do an act, the readiness
implies the proximity of such willingness and its ultimate
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physical manifestation. Readiness must, in all cases, be backed
by willingness, and its imminent physical action is
demonstrated when it is about to be put into action.
The onus of proof of being ready and willing to perform
his part of the contract from the date of the contract to the
date of filing of the suit is on the plaintiff. An averment that the
plaintiff is ready and willing to perform his part of the contract
is sufficient compliance with Section 16(c) of the Specific Relief
Act. It is not necessary for the plaintiff to further aver that he
had made a demand upon the defendants to execute the sale
deed on a particular date. Nor is it necessary that the plaintiff
must have averred his readiness and willingness in the notice,
if he has sent one.
As already noted above, the plaintiff sued to enforce a
specific performance of a contract to execute a conveyance in
respect of the suit schedule property. While answering point
No.1, I have already held that there is an offer and acceptance,
and there is a binding contract between the plaintiff and the
defendants. If we carefully look into the pleadings and the oral
and documentary evidence on record, it would appear that the
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plaintiff has established he is entitled to the relief of a specific
performance. However, the Trial Court has viewed the issue as
if it were a loan transaction. Moreover, the defendants
themselves have admitted the execution of the agreement;
hence, the Trial Court could not have viewed the issue from a
different perspective. The circumstances would justify the
interference by this Court, and in my view, the material
evidence on record is sufficient to grant the relief of specific
performance. The Trial Court has failed to appreciate the issue
from the right perspective. I may venture to say that the Trial
Court has failed to have regard to relevant considerations and
disregarded relevant matters. To conclude, I can say only this
much that the plaintiff has established his case, and he is
entitled to the relief.
10. The Judgment dated 28.11.2017 passed by the Prl.
Senior Civil Judge and CJM, Mandya in O.S.No.51/2016 is set
aside. The plaintiff's suit is decreed. The defendants are hereby
directed to execute the sale deed on receiving the balance sale
consideration amount within 30 days from today, failing which
the plaintiff to secure the sale deed through the Court. The
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Registry concerned is hereby directed to draw the decree
accordingly.
11. Resultantly, the Regular First Appeal is allowed.
Because of the disposal of the appeal, pending
interlocutory applications, if any, are disposed of.
Sd/-
(JYOTI MULIMANI)
JUDGE
MRP
