Karnataka High Court
Sateesh S/O Bharamappa Konabevu vs Katteppa S/O Yamanappa Malagi on 3 June, 2025
Author: Hanchate Sanjeevkumar
Bench: Hanchate Sanjeevkumar
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RFA No. 100520 of 2018
HC-KAR
IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
DATED THIS THE 3RD DAY OF JUNE, 2025
BEFORE
THE HON'BLE MR. JUSTICE HANCHATE SANJEEVKUMAR
REGULAR FIRST APPEAL NO. 100520 OF 2018 (SP)
BETWEEN:
SATEESH S/O BHARAMAPPA KONABEVU,
AGE: 39 YEARS, OCC: NIL,
R/O: KURABAGERI, MALAGER ONI,
RANEBENNUR, TQ: RANEBENNUR,
DIST: HAVERI, P.C. NO:581 115.
... APPELLANT
(BY SRI. P.G. MOGALI, ADVOCATE)
AND:
KATTEPPA S/O YAMANAPPA MALAGI,
AGE: 31 YEARS, OCC: AGRICULTURE AND
VEGETABLE BUSINESS, R/O: KURABAGERI,
MALAGER ONI, RANEBENUR,
TQ: RANEBENNUR, DIST: HAVERI,
P.C. NO:581 115.
Digitally signed by ... RESPONDENT
MALLIKARJUN
RUDRAYYA KALMATH
(BY SRI. M.H. PATIL, ADVOCATE)
Location: HIGH COURT
OF KARNATAKA THIS REGULAR FIRST APPEAL IS FILED UNDER SEC. 96 OF
DHARWAD BENCH
CPC., PRAYING TO SET ASIDE THE JUDGMENT AND DECREE DATED:
01.10.2018 PASSED IN O.S.NO.24/2015 ON THE FILE OF THE
LEARNED III ADDITIONAL SENIOR CIVIL JUDGE AND JUDICIAL
MAGISTRATE FIRST CLASS, RANEBENNUR.
THIS APPEAL, COMING ON FOR FINAL HEARING THIS DAY,
THE JUDGMENT WAS DELIVERED THEREIN AS UNDER:
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RFA No. 100520 of 2018
HC-KAR
ORAL JUDGMENT
(PER: THE HON'BLE MR. JUSTICE HANCHATE SANJEEVKUMAR)
This Regular First Appeal is filed by the
defendant/appellant challenging the judgment and decree
dated 01.10.2018 passed in O.S No.24/2015 on the file of III
Additional Senior Civil Judge and JMFC, Ranebennur
(hereinafter referred to as the 'Trial Court'), thereby, the suit
filed by the plaintiff for specific performance of contract is
decreed with cost.
2. For the sake of convenience and easy reference,
the parties are referred to as per their rankings before the
Trial Court.
3. The plaintiff with pleadings stated that defendant
is the owner of suit property by virtue of share allotted to
him in his family partition dated 01.12.1999. The defendant
for his financial need had agreed to sell the suit property for
a total sale consideration of Rs.12,00,000/- to the plaintiff
and had entered into an agreement of sale dated
06.12.2014, which is registered one. At the time of
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registration of agreement of sale, the plaintiff had paid a
sum of Rs.10,00,000/- to the defendant. But thereafter, the
defendant has not come forward to execute Sale Deed by
receiving balance sale consideration. Therefore, the plaintiff
was constrained to issue legal notice dated 12.01.2015 to
defendant. But the defendant did not turn-up to execute the
Sale Deed. Therefore, the plaintiff has filed the suit for
specific performance of contract.
4. The defendant has filed the written statement
contending that he has not intended to sell the suit property.
But for his financial need he has taken a loan of
Rs.12,00,000/- from the plaintiff and for security purpose, a
document is executed, but it was converted into an
agreement of sale. Therefore, the defendant pleaded that
there is no agreement of sale and whatever amount taken by
the plaintiff is only for security towards loan purpose.
5. Based on the pleadings of the parties, the Trial
Court has framed the following issues:
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1. "Whether plaintiff proves that, defendant
executed agreement of sale dated 20.01.2015
agreeing to sell the suit properties for consideration
of Rs.12 lakh and received 10 lakhs as earnest
money?
2. Whether defendant proves that, he executed
the agreement of sale as security to the loan?
3. Whether plaintiff proves that, he was always
ready and willing to perform his part of contract?
4. Whether plaintiff is entitled for the relief of
specific performance as prayed for?
5. What order or decree?"
6. The plaintiff was examined as PW.1 and three
witnesses were examined as PW.2 to PW.4 and got marked
documentary evidence as Ex.P1 to Ex.P11. The defendant
was examined as DW.1 and got marked documentary
evidence as DW.1.
7. The Trial Court has decreed the suit by directing
the defendant to execute an absolute registered Sale Deed to
the plaintiff after receiving balance sale consideration of
Rs.2,00,000/-. The Trial Court assigned reasons that Ex.P1 is
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the registered agreement of sale and the defendant has
failed to prove that he has received the amount from plaintiff
as a loan transaction. Further, the trial Court assigned a
reason that the defendant had failed to prove that for
security purpose, he has offered suit property (agreement of
sale). Therefore, the Trial Court forms an opinion that the
defendant had executed agreement of sale and thus decreed
the suit in favour of plaintiff.
8. Being aggrieved by it, the defendant has filed the
present appeal. The defendant has raised many grounds that
suit property is the only house for defendant and if the said
suit house is sold out, then he and his family members will
face great hardship. Further, it is submitted that the plaintiff
has landed properties and owned a house in Ranebennur
town. Therefore, the suit property was not required for the
plaintiff. Therefore, prays to set aside the decree passed by
the Trial Court and dismiss the suit.
9. The learned counsel for the appellant submitted
that the defendant had never agreed to sell the suit
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property, but has only taken loan from the plaintiff, since he
was constructing house building. Therefore, in this regard,
the documents which was executed as a security purpose,
was illegally converted into an agreement of sale. Further
submitted that, just because, an agreement of sale is
registered one and decree granted is lawful, but still it is
Court discretion as to whether to grant a decree for specific
performance or not as per Section 20 of the Specific Relief
Act, 1963 (hereinafter referred to as the 'Act') and they have
submitted that the defendant had only suit house for his
family, whereas the plaintiff is the owner of house situated in
Ranebennur city and also owner of various other properties.
Therefore, when the plaintiff has already owned a house, but
the defendant does not have any other house except suit
property, therefore on the contrary, the defendant would
face more hardship compared to the plaintiff, in case the suit
is decreed in full for specific performance of contract.
Therefore, prays to set aside the judgment and decree
passed by the Trial Court.
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10. On the other hand, learned counsel for the
respondent submitted that the defendant had executed
registered agreement of sale and had an intension to sell
away the property in favour of plaintiff. Therefore, the
plaintiff is entitled relief of decree for specific performance of
contract, which is rightly recorded by the Trial Court. Further
submitted that the defendant has failed to prove loan
transaction and the suit property is offered for security
purpose. Therefore submitted that the appreciation of
evidence made by the Trial Court is perfectly justifiable and
correct one. Hence, prays to dismiss the appeal.
11. Heard arguments from both sides and perused
records. The points that arise for consideration is as follows:
i) Whether, under the facts and circumstances
involved in the case, if the suit is decreed in favour
of plaintiff by granting decree for specific
performance of contract, then the defendant would
face more hardship compare to plaintiff?
ii) Whether, under the facts and circumstances
involved in the case, the plaintiff is entitled relief
of specific performance of contract?
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iii) Whether the judgment and decree passed by
the Trial Court needs any interference of this
Court?
12. In the present case, it is not disputed that the
defendant is the owner of suit property. Ex.P1 is the
registered agreement of sale. It is the contention of
defendant that he has taken loan of Rs.12,00,000/- from the
plaintiff and for security purpose, registered agreement of
sale is made. But the defendant has never intended to sell
away the suit property. But it is the contention of plaintiff
that the defendant has voluntarily offered suit property for
sale and received an earnest amount of Rs.10,00,000/- out
of Rs.12,00,000/-. The plaintiff has to pay remaining amount
of Rs.2,00,000/-. Hence, the plaintiff is entitled decree for
specific performance of contract. Out of Rs.12,00,000/-, the
only remaining thing is that the plaintiff has to pay
Rs.2,00,000/-. Therefore, submitted that since the plaintiff
has paid substantial sale consideration amount, the plaintiff
is entitled decree for specific performance. But upon
considering the cross examination, the plaintiff has admitted
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that the plaintiff is owner of 3 acres of land and also owner
of house in Ranebennur town. But it is the contention of the
defendant that the suit property is the only house for his and
family purpose. When these circumstances are considered,
then, grant of relief of decree of specific performance is
discretionary as per Section 20 of the Act. Just because, an
agreement of sale is proved and grant of decree is lawful to
do so, but still the Court has discretion whether to grant or
not the decree for specific performance considering the
factors compared hardship between the plaintiff and
defendant, whether granting of decree is amounting to
arbitrary and whether it creates an unfair advantage over the
defendant by the plaintiff. When these factors are taken into
consideration, as enumerated in Section 20 of the Act and
the facts are considered in this regard, the plaintiff has not
denied that the suit property is only property of defendant
for his residence and also the plaintiff admitted in his cross
examination that he has owned one house in Ranebennur
town and also an agricultural land. The plaintiff is doing
vegetable marketing business. Whereas, the suit property is
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the only residential house property for the defendant and his
family members. Therefore, upon considering the compared
hardship in this regard, if decree is granted in full, then
defendant would be put into more hardship compared to the
plaintiff. Further, if decree for specific performance of
contract is granted, then, it would be unfair advantage over
the defendant by the plaintiff. Therefore, under these facts
and circumstances involved in the case, the discretion has to
exercise not to grant the main relief of specific performance
but the plaintiff is liable to be compensated by directing the
defendant to reimburse the amount he has received with
interest. In this regard, the discretion exercised by the Trial
Court is not correct and proper. Therefore, the judgment and
decree passed by the trial Court is liable to be set aside.
Therefore, the appeal is liable to be allowed. Hence, I answer
point No.(i) and (iii) in the 'affirmative' and point No.(ii) in
the 'negative'.
13. In the result, I proceed to pass the following:
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ORDER
i. The appeal is allowed.
ii. The judgment and decree dated 01.10.2018
passed in O.S No.24/2015 on the file of III
Additional Senior Civil Judge and JMFC,
Ranebennur is set aside.
iii. The defendant is directed to refund the
amount of Rs.10,00,000/- with interest at the
rate of 12% p.a. from the date of agreement
of sale dated 06.12.2014.
iv. In case, the defendant fails to repay the
amount as directed above, then, the plaintiff
is at liberty to file execution petition and
recover the amount as per law.
v. Draw decree accordingly.
Sd/-
(HANCHATE SANJEEVKUMAR)
JUDGE
PMP para 1 to 11
RKM para 12 to end
CT:BCK
