Madras High Court

G. Bhoopathy vs A. Sundaramoorthy on 16 July, 2021

                                   IN THE HIGH COURT OF JUDICATURE AT MADRAS
                                                 DATED: 16.07.2021
                                                        CORAM:
                                      THE HONOURABLE MS.JUSTICE P.T.ASHA
                                                 S.A.No.466 of 2008
                                                         &
                                                  M.P.No.1 of 2008

                     G. Bhoopathy                                              ... Appellant

                                                        versus
                     1. A. Sundaramoorthy

                     2. Sherifa Bivi                                           ...Respondents

Prayer: Second Appeal filed to set aside the judgment and decree made in A.S.No.236 of 2005 dated 22.08.2007 on the file of the Additional District Judge (II Fast Tract Court Judge) at Chennai, confirming the judgment and decree in O.S.No.1748 of 2000 dated 12.11.2003 on the file of the XII Assistant Judge, City Civil Court at Chennai, to be set aside and the Appeal be allowed.

                               For Appellant        :      Mr. A.S. Narasimhan

                               For Respondents      :      Mr. A.E. Ravichandran
                                                           for R1
                                                           R2- No appearance
                                                           R3- Not ready in notice






https://www.mhc.tn.gov.in/judis/
                                                        JUDGMENT

The above Second Appeal is filed by the third defendant in the suit

O.S.No.1748 of 2000 challenging the Judgment and decree in A.S.No.236

of 2005 dated 22.08.2007 on the file of the Additional District Judge (Fast

Tract Court No.II, Chennai) in and by which the judgment and decree of XII

Assistant City Civil Court, Chennai in O.S.No.1748 of 2000 had been

confirmed.

2. The parties are referred to in the same array as in the suit. The suit

in O.S.No.1748 of 2000 was filed by the plaintiffs for a specific

performance directing the defendants to execute a sale deed in favour of the

plaintiff at the plaintiff's expense in respect of vacant land bearing Plot

No.180, Block No.8, Mogappair Village, Annanagar (West), Chennai

measuring 4065 Square feet.

Plaintiffs' case:

3. The case of the plaintiff was that the suit property was originally

alloted to the first defendant by the Tamil Nadu Housing Board (TNHB)

https://www.mhc.tn.gov.in/judis/ vide its order dated 08.10.1986. On 12.12.1991, the first defendant had

executed an agreement of sale in favour of the plaintiff in respect of the said

property. As per the said agremeent, the first defendant had received a sum

of Rs.30,000/- and the agreement provided that the balance amount payable

to the Tamil Nadu Housing Board would be paid by the plaintiff. After

these dues are settled to the Tamil Nadu Housing Board and the Tamil Nadu

Housing Board executes a sale deed in favour of the first defendant, the first

defendant had in turn agreed to execute a sale deed in favour of the plaintiff

without insisting for any future payment.

4. It is also the case of the plaintiff that along with the agreement of

sale, a Power of Attorney of the same date was also executed in favour of

the plaintiff, so as to enable the plaintiff to take possession of the plot and to

construct thereupon after getting permission from the concerned authority.

The first defendant had also given a declaration to the Tamil Nadu Housing

Board that all installments and the final cost of the EMD payment would be

paid by the plaintiff in her name.

5. The plaintiff would submit that in keeping with the terms of the

https://www.mhc.tn.gov.in/judis/ agreement, he had been making payments to the Tamil Nadu Housing Board

on behalf of the first defendant. However, the plaintiff came to learn that

behind his back, the first defendant had also clandestinely paid the balance

amount to the Housing Board in the month of July 1999 and got a sale deed

executed in her favour. Despite the plaintiff's best efforts to get in touch

with the first defendant, he was not able to do so. Therefore, the plaintiff

had issued a legal notice dated 20.12.1999 calling upon the first defendant

to execute a sale deed in his favour. Though the notice was received on

22.12.1999 by the first defendant, she did not care to send any reply to the

said notice. Therefore, the plaintiff was constrained to institute the suit.

6. Originally the suit was filed only against the first defendant. After

the filing of the written statement by the 1st defendant, the second and third

defendants were impleaded as party defendants.

Written Statement of the First Defendant:

7. The first defendant had filed her written statement in which she had

mentioned about the sale in favour of the second defendant who in turn had

sold the suit property to the third defendant. The first defendant in her

https://www.mhc.tn.gov.in/judis/ written statement would deny all the allegations including the execution of

the agreement of sale as well as receipt of the sum of Rs.30,000/-. The

payment made to the Housing Board was also denied.

Additional Written Statement of the First Defendant:

8. An additional written statement was filed by the first defendant on

20.03.2003 after the plaint was amended in which she had come forward

with a contention that she had borrowed a sum of Rs.15,000/- from one

Gopu of Mogaperu, who had obtained her signatures in a blank stamp

papers and blank green papers, which has been utilized to create the

agreement of sale. She would deny that she had executed a Power of

Attorney in his favour. She would submit that after receiving a sum of

Rs.15,000, the said Gopu who had taken her to the Registrar's office,

obtained her signature by saying that he was creating a document in the

form of power of Attorney for the said amount. It was the said Gopu who

had sold the property to the second defendant as she could not repay the

sum of Rs.15,000/-.

9. The third defendant filed a written statement contending that the

https://www.mhc.tn.gov.in/judis/ alleged agreement dated 12.12.19991 is void ab intio and the said agreement

is not valid in the eye of law. Therefore, he strongly denied that the

plaintiff had been put in the possession of the suit property as early as 1991

and the said statement lacks truth.

10. He would further submit that he is a bona fide purchaser for value

under a sale deed dated 22.11.1999. The plaintiff has filed the suit only

with an intention to harass the third defendant and based on the agreement

dated 12.12.1991, the plaintiff is not entitled for any relief under the

Specific Relief Act.

11. The third defendant had also filed a suit O.S.No.4297 of 2002 for

a permanent injunction restraining the plaintiff in O.S.No.1748 of 2000

from interfering with his peaceful possession and enjoyment of the suit

property.

Trial Court

12. The plaintiff had examined himself as P.W.1 and had marked

Exs.A1 to A10 in support of his case. The first defendant examined herself

https://www.mhc.tn.gov.in/judis/ as D.W.1 and the third defendant had examined himself as D.W.2 and Exs.

B.1 to B.11 were marked on the side of the defendants.

13. The Learned XII Assistant City Civil Judge had framed the

following issues:

“1. Whether the suit is barred by limitation

2. Whether the plaintiff is entitled to the

relief of specific perforamnc as prayed for ?

3. To what other reliefs the plaintiff is

entitled to ?

14. The learned Judge on considering the evidence on record, decreed

the suit as prayed for. The learned Judge dismissed the suit OS.No.4297 of

2002 filed by the third defendant.

Appellate Court

15. Challenging the judgment and decree in O.S.No.1748 of 2000, the

third defendant alone had filed an appeal in A.S.No.236 of 2005. However,

no appeal was filed against the judgment and deree against the suit

https://www.mhc.tn.gov.in/judis/ O.S.No.4297 of 2002.

16. The learned District Judge II Fast Tract Court, Chennai

confirmed the judgment and decree of the Trial Court. Aggreived by the

same, the above Second Appeal has been filed once again only by the 3 rd

defendant.

17.The Second Appeal was admitted on the following substantial

question of law:

“When the Ex.A.3 is Registrable document under

Section 17 (1) (b) of the Registration Act, contrary to Section

47 can Ex.A.3 be received in evidence and looked into for the

purpose of passing decree in the suit?”

18. Pending the arguments the following substantial question of law

was framed by the Court on perusing the evidence on record and the

counsels have addressed their arguments on the same.

“Whether in the light of the specific clause in the Ex.A.3 agreement of sale that in the event of

https://www.mhc.tn.gov.in/judis/ the non-execution of the sale deed, the plaintiff purchaser would be entitled to refund of the advance amount with interest and cost of construction / improvements made on the suit property with penalty is the suit for specific performance maintainable?”

Submissions:

19. Mr. A.S.Narasimhan, learned counsel appearing on behalf of the

appellant would base his arguments on the sole contention that Ex.A.3 was

a sale deed, though it has been styled as an agreement of sale and therefore

it requires to be registered under Section 17 (1)(b) and since the same has

not been registered it cannot be received in evidence nor considered. This

argument has been advanced for the first time before this Court. He would

invite the attention of the Court to the recitals in the agreement of sale and

submit that the recital would show that the sale consideration was a sum of

Rs.30,000/- and the same was fully paid. Further the plaintiff was put in

possession of the property and therefore the said document is nothing but a

sale deed though styled as a sale agreement.

https://www.mhc.tn.gov.in/judis/

20. He would further submit that the third defendant is a bona fide

purchaser for value and therefore his possession has to be protected. It is

his contention that the plaintiff had not proved his readiness and

willingness.

21. Per contra, Mr. Ravichandran, learned counsel appearing on

behalf of the first respondent, would submit that it is for the first time that

the admissibility of the sale agreement as evidence has been raised. He

would further contend that despite a common judgment having been passed

in the matter, the third defendant has filed the appeal only in respect of one

suit. He would rely on the Judgement of the Hon'ble Supreme Court

reported in 2019 (11) SCC 432 – Kamal Kant Jain Vs. Surinder Singh

(Dead) Through Legal Representatives as an answer to the 2nd substantial

question of law framed by this Court. He would submit that where the

damages were fixed for securing specific performance then it is not a bar for

filing a suit for specific performance. He would argue that this defense was

also not raised before the Courts below.

22. He would further submit that the present contention of the learned

https://www.mhc.tn.gov.in/judis/ counsel for the appellant cannot be entertained since the document in

question viz; Ex.A.3, has been received without any objection and has been

marked. He would submit that neither in the written statement nor in the

grounds of appeal before the Appellate Court had this ground been raisedd

by the appellant.

23. He would submit that the Lower Appellate Court has considered

in detail the plea of the third defendant regarding the genuineness of the

agreement of sale Ex.A.3 to arrive at a conclusion that the same is a

genuine document. He would therefore submit that since both the Courts

have appropriately considered the issues and came to the right conclusion,

this Court cannot re-appreciate the evidence.

24. Heard the counsel and perused the documents.

25. The only contention that has been canvassed by the third

defendant/appellant before this Court is that the document, Ex.A.3 though

styled as an agreement of sale, is in effect a sale deed. This argument has

been put forward for the first time in this appeal. Once a document is

https://www.mhc.tn.gov.in/judis/ treated as a sale deed, then under Section 17 (1)(b) of the Registration Act

the same requires to be compulsorily registered. For this purpose, it is

necessary to consider the recitals of Ex.A.3. The recitals of Ex.A.3 would

indicate that on the date of the agreement, a sum of Rs.30,000/- had been

paid by the plaintiff/first defendant and he is under an obligation to pay the

monthly installments payable to the Housing Board as also any other

payments that was to be made to the Board. The Agreement of sale is also

accompanied by a Power of Attorney Ex.A.7, which has been executed by

the first defendant in favour of the plaintiff for interacting with the Housing

Board. On the completion of the period of lease and on the execution of the

sale deed by the Board in favour of the first defendant, she has undertaken

to execute the sale deed in favour of the plaintiff. Therefore on the date of

the agreement the 1st defendant could not execute the sale deed as the

further amounts were payable to the TNHB.

26.Only after these payments were cleared the sale deed would be

executed by the Housing Board in favour of the 1st defendant who inturn

was required to execute the sale deed in favour of the plaintiff. The 1 st

defendant had therefore authorized the plaintiff to pay the dues on her

https://www.mhc.tn.gov.in/judis/ behalf to the TNHB which fact was also detailed in Ex.A.4 declaration.

Therefore, Ex.A.3 can only be treated as an agreement of sale. That apart,

this plea has not been raised either before the Trial Court or before the

Appellate Court. Therefore, substantial question of law no.1 is answered

against the 3rd defendant / appellant.

27. As regards the second question of law the counsel for the

appellant / 3rd defendant had not made any submissions. This question of

law has been framed taking into consideration Section 23 (1) of the Specific

Relief Act, 1963 which reads as follows:

“Liquidation of damages not a bar to specific performance.— (1) A contract, otherwise proper to be specifically enforced, may be so enforced, though a sum be named in it as the amount to be paid in case of its breach and the party in default is willing to pay the same, if the court, having regard to the terms of the contract and other attending circumstances, is satisfied that the sum was named only for the purpose of securing performance of the contract and not for the purpose of giving to the party in default an option of paying money in lieu of specific performance.”

28. The learned counsel for the plaintiff has relied on the Judgement

https://www.mhc.tn.gov.in/judis/ of the Hon'ble Supreme Court reported in 2019 (11) SCC 432 – Kamal

Kant Jain Vs. Surinder Singh (dead) through Legal Representatives. The

Bench had held that where specified damages was provided in the

agreement to secure performance of the contract the same would not be a

bar to grant the relief of specific performance. However, when damages are

in the nature of paying money in lieu of specific performance then the same

would act as a bar to granting the relief of specific performance. Though

the language of the penultimate clause in the agreement of sale Ex.A.3

could be so construed, however, since this defense has not been urged either

before the Courts below or canvassed in right earnest by the appellant

before this Court, this substantial question of law is also answered against