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Uttarakhand High Court · body

2010 DIGILAW 222 (UTT)

Ram Swaroop Singh and others v. Karan Singh

2010-04-21

TARUN AGARWALA

body2010
Judgment Heard Sri V. K. Kohli, the learned senior counsel duly assisted by Sri I. P. Kohli, the learned counsel for the appellants defendants and Sri Jitendra Chaudhary, the learned counsel for the respondents plaintiffs. 2. The plaintiffs respondents filed a suit for specific performance of a registered agreement to sell. The plaintiffs contended that by a registered agreement, the defendant no.1 Pritam Singh had agreed to sell the land to the plaintiffs measuring 2.90 acres of land in Khasra No.48 of village Jamniwala, Tehsil Kashipur for a sum of Rs.20,300. It was contended that a sum of Rs.7000/- was paid as advance and the balance amount was to be paid at the time of the execution of the sale deed. The plaintiffs contended that the defendant was requested several times to execute the sale deed, which fell on deaf ears and, ultimately, it was found that the defendant no.1 had sold the land in question to defendant nos.2 & 3 by means a registered sale deed dated 06.09.1983 selling 1.60 acres of land and by another sale deed dated 12.12.1983, the remaining land was sold to defendant nos.2, 3 & 4 for Rs.28,000/-. The plaintiffs accordingly prayed that the defendants be directed to execute the sale deed and deliver the possession of the land to the plaintiffs. During the pendency of the suit, the defendant no.1 Pritam Singh died and his legal heir Smt. Bhagwati Devi was substituted, who filed the written statement and submitted that the plaintiff no.2 Murari Singh was her brother and that plaintiff no.1 Karan Singh was a friend of Murari Singh. The defendant admitted that a registered agreement to sell the land in question was executed since it was apprehended that the original defendant late Pritam Singh, i.e. the vendor, would sell the land in question to a third party, an agreement to sell was executed without payment of any consideration. 3. The defendant no.2 and 3 filed their written statements alleging that they had no knowledge or notice of any agreement to sell between the plaintiffs and the defendant no.1 and that they are the bonafide purchasers and that they had purchased the property in good faith for valuable consideration and without notice. The defendants further contended that Murari Singh plaintiff no.2 had not filed the suit nor had signed the plaint and, therefore, the suit was not maintainable. The defendants further contended that Murari Singh plaintiff no.2 had not filed the suit nor had signed the plaint and, therefore, the suit was not maintainable. It was also alleged that the agreement to sell the property in question, if any, was executed without payment of any consideration. Similar allegation was also made by the defendant no.4 in his written statement. 4. The trial court, on the basis of the pleadings, framed various issues and, after appreciating the evidence that was brought on record, decreed the suit and directed the defendants to execute the sale deed. The trial court held that the plaintiff Murari Singh admitted that an agreement to sell was executed by the original vendor late Pritam Singh and that the signatures on the said document were of that late Pritam Singh and that the said agreement was duly registered before the Sub Registrar’s Office. The trial court further found that the legal heir of defendant no.1 also admitted in her written statement about the execution of the agreement to sell and, therefore, concluded that the original vendor had executed a registered agreement to sell. The trial court further found that the defendant no.2 to 4 are not the bonafide purchasers and were deemed to have notice of the agreement to sell. The trial court further found that since the defendants did not enquire from the office of Sub Registrar, the defendants had deemed knowledge of the alleged agreement to sell. The trial court further found that on the other hand, the plaintiffs were always ready and willing to perform their part of the agreement and, in this regard, had issued notices dated 30.05.1983 and 04.10.1983 requesting the defendant no.1 to execute the sale deed. The trial court further found that inspite of the receipt of the said notices, the sale deed was not executed in favour of the plaintiffs. 5. The defendants, being aggrieved by the decree passed by the trial court, preferred an appeal, which was also dismissed. The appellate court affirmed the findings arrived at by the trial court. 6. The defendants, being aggrieved by the judgment of the courts below, has preferred the present second appeal. 7. This court, by an order dated 18.05.2005, framed the following substantial question of law, namely, “1. The appellate court affirmed the findings arrived at by the trial court. 6. The defendants, being aggrieved by the judgment of the courts below, has preferred the present second appeal. 7. This court, by an order dated 18.05.2005, framed the following substantial question of law, namely, “1. Whether the Courts below were empowered to decree the suit for specific performance in respect of the entire land covered by the Joint executrix Murari Singh stated on oath that neither he got any agreement for sale executed in his favour nor paid any earnest money?” 8. Subsequently, by an order dated 22.05.2007, this court framed the following substantial questions of law, namely:- “(1) Whether the plaintiffs were always ready and willing to perform the essential terms of the contract, which are to be performed by them? (2) Whether the jurisdiction to grant the decree for specific performance being discretionary and the Court is bound to take into consideration, the circumstances as contained under Section 20 as well as 21 of the Specific Relief Act as contained under the explanation to Section 21(1) of the Specific Relief Act? (3) Whether the relief of specific performance being dependent upon the cancellation of the deed executed on 6th September, 1983 and 12th September, 1983 and as such in these circumstance equitable relief can be granted by the Courts?” 9. The learned senior counsel for the appellants submitted that the plaintiff no.2 Murari Singh did not file the suit nor had signed the vakalatnama and that the said plaintiff had admitted this fact in his deposition, consequently, the suit was not maintainable. It was further submitted that the percentage of share between the plaintiffs were not defined in the agreement to sell and, consequently, under Section 45 of the Transfer of Property Act, the plaintiffs would be deemed to have equal shares, namely, 50 percent. The learned senior counsel for the appellants contended that since Murari Singh did not institute the suit, the decree for specific performance for the whole land, which was undivided could not have been decreed by the trial court and, consequently, to that extent, the decree passed by the trial court was erroneous. The learned senior counsel for the appellants contended that since Murari Singh did not institute the suit, the decree for specific performance for the whole land, which was undivided could not have been decreed by the trial court and, consequently, to that extent, the decree passed by the trial court was erroneous. The learned senior counsel submitted that the plaintiff no.2 Murari Singh was never ready or willing to perform his part of the contract and, in the absence of this averment, which was a necessary ingredient, the suit for specific performance could not be decreed. The learned senior counsel submitted that under Section 20 and 22 of the Specific Relief Act, the Court has a discretionary jurisdiction and in a situation like this, when one of the plaintiffs was not ready and willing to perform his part of the contract, the suit for specific performance should not have been decreed and that the court below alternatively could have compensated the plaintiffs under Section 21 sub-clause (5) of the Specific Relief Act. In support of his contention, the learned senior counsel for the appellants placed reliance upon a decision of the Delhi High Court in Anil Kumar Handa Vs. Smt. Suman Bala AIR 1980 Delhi 103, wherein it was held:- “4. The plaintiff has claimed two reliefs one with respect to immovable properties and the other with jurisdiction to grant the relief pertaining to immovable properties. The question therefore is: Can the Court return the plaint as regards the relief pertaining to immovable properties? If a Court has no jurisdiction to entertain suit with respect to all the reliefs claimed, the plaint is liable to be returned to the plaintiff for presentation to the Court in which the suit should have been originally instituted under O.7, R. 10 C.P.C. But in the present case this Court has jurisdiction to determine the right of the plaintiff with respect to one relief i.e. movable properties. If the plaint is to be returned to the plaintiff, then this Court will not be in a position to determine the plaintiff’s right with respect to the relief regarding movable properties. In these circumstances the appropriate course would be to reject the plaintiff’s claim pertaining to immovable properties in suit and to entertain the plaintiff's suit with respect to movable properties. In these circumstances the appropriate course would be to reject the plaintiff’s claim pertaining to immovable properties in suit and to entertain the plaintiff's suit with respect to movable properties. I, therefore, reject the plaintiff’s claim with respect to the immovable properties namely, three plots situated at Sharanpur detailed in Sch. 'A' annexed to the plaint. Issue No. 2: The plaintiff has claimed absolute right with respect to the various amounts lying with various banks at Saharanpur and at Delhi. The right is being claimed under the Will dated 26th Dec., 1977 of Kewal Kishan Handa. The defendant admits the allegations contained in the plaint. If the defendant is admitting the plaintiff's claim there is no necessity to grant any declaration. Section 34 of the Specific Relief Act is as under : “Section 34.- Discretion of Court as to declaration of status or right. Any person entitled to any legal character, or to any right as to any property, may institute a suit against any person denying or interested to deny his title to such character or right, and the Court may in its discretion make therein a declaration that he is so entitled, and the plaintiff' need not in such suit ask for any further relief: Provided that no Court shall make any such declaration where the plaintiff', being able to seek further relief than a mere declaration of title, omits to do so.” The plaintiff' has no absolute right to claim a decree for declaration. This section confers a discretion upon the Court to grant or not to grant a declaration sought for by the plaintiff'. The discretion is to be exercised on sound judicial principles. After the death Kewal Kishan Handa the testator, the legatee has to take out a Succession Certificate or a Probate to recover or release the property left by the deceased. The plaintiff' claims himself to be a legatee under the said will but it appears he has not taken any steps to obtain either a probate of the Will or Succession Certificate to the estate of the deceased. The present suit is a suit for declaration only. The value of the suit for purposes of jurisdiction has been fixed at Rupees 3,50,000/- being the value of the properties and the assets left by the deceased, Kewal Kishan Handa, Under Art. 11 or 12 of Sch. The present suit is a suit for declaration only. The value of the suit for purposes of jurisdiction has been fixed at Rupees 3,50,000/- being the value of the properties and the assets left by the deceased, Kewal Kishan Handa, Under Art. 11 or 12 of Sch. I of the Court-fees Act, 1879 as applicable to the Union Territory of Delhi Court-fees at the rate of 2½ of the value of the property in respect of which the Probate or Succession Certificate is claimed is payable. The value of the claim by the plaintiff as stated is Rs. 3,50,000/-. Thus the plaintiff , if he desires to obtain the probate or Succession Certificate, has to pay Court-fees of Rs. 8,750/-. On the present plaint he has paid fixed Court-fees of Rupees 19.50 only. The present suit is a device to avoid payment of the Court-fees. A declaration decree should not be made by a Court where the object of the suit is to evade payment of stamp duty or Court-fees and the Court in the exercise of its discretion should refuse relief in such cases. Another reason is that there is no denial by the defendant. The question is : What is the necessity of the declaratory decree when there is no denial by the defendant. The only purpose appears to be to evade payment of Court-fees and claim the various amounts lying in various banks on the basis of declaration. This would amount to giving relief to the plaintiff' without making him liable to pay the Court-fees required to be paid by him under the Court-fees Act. Ordinarily the banks cannot make payment of the amounts lying to the credit of the deceased unless the right of the claimant is established before a Court of law. The plaintiff has adopted the present suit as the mode to get a declaration in his favour and then to claim the amounts from the various banks . As the defendant does not deny the allegations of the plaintiff, the plaintiff is not likely to suffer at all if the declaration sought for by him is refused.” 10. The plaintiff has adopted the present suit as the mode to get a declaration in his favour and then to claim the amounts from the various banks . As the defendant does not deny the allegations of the plaintiff, the plaintiff is not likely to suffer at all if the declaration sought for by him is refused.” 10. In the end, the learned senior counsel for the appellants submitted that the suit for specific performance was not maintainable since admittedly the plaintiffs had not prayed for the cancellation of the sale deed dated 06.09.1983 and 12.12.1983 executed in favour of defendant nos.2, 3 & 4. The learned senior counsel further submitted that it was essential that the sale deed executed in favour of the defendant nos.2, 3 & 4 was cancelled first and, only thereafter, the court below could issue a direction for the execution of the sale deed in favour of the plaintiffs and that since no such prayer for the cancellation of earlier sale deed was made, the suit for specific performance could not be decreed. In support of his contention, the learned senior counsel for the appellants placed reliance upon a decision of the Karnataka High Court in Chikkathamaiah & others Vs. Chikkahutchiah & others AIR 1977 Karnataka 99. 11. On the other hand, the learned counsel for the plaintiffs opposite parties submitted that the plaintiffs were always ready and willing to perform their part of the contract and such averments had already been made in the plaint and that it was immaterial as to whether one of the plaintiffs was willing to fulfill his part of the contract or not. It was sufficient that one of the plaintiffs was ready and willing to perform the part of the contract. The learned counsel for the opposite parties submitted that the defendants are not bonafide purchasers and, consequently, no discretion can be granted in favour of the defendants and that the defendants had knowledge of the agreement executed between the plaintiffs, inspite of which, they chose to get the sale deed executed and consequently the trial court rightly exercised its discretion and directed the defendants to execute the sale deed in favour of the plaintiffs and that it was not necessary that the plaintiffs should be compensated in terms of money. The learned counsel for the plaintiff also submitted that there was no need for cancellation of the sale deed executed in favour of the defendants since the Supreme Court in a catena of decisions have consistently taken the view that the defendants can be directed to execute the sale deed and that there was no requirement for the cancellation of the sale deed executed by defendant no.1 in favour of defendant nos.2, 3 and 4. 12. In Bhorey Nirottam Das Vs. Mool Chand (deceased by L.R.’s) and others reported in 1982 Allhabad Law Journel 1049, it was held that the requirement of Section 16 (c) of the Specific Relief Act was twofold, namely, that the plaintiff must aver in the plaint that he was always ready and willing to fulfill his part of the contract and that he must prove by evidence that the plaintiff was always ready and willing to perform his part of the contract. It was further held that the provision is mandatory and failure of plaintiff to comply with any of the requirement was fatal. In the present case, the court finds that a reading of the plaint shows that the necessary ingredients of Section 16(c) of the Specific Relief Act was clearly averred, namely, that the plaintiffs were ready and willing to perform their part of the contract. The fact that they were always ready and willing to perform their part of the contract is proved by the issuance of two notices sent by the plaintiff to the defendant no.1, who inspite of the receipt of the said notices did not execute a sale deed in favour of the plaintiffs. The mere fact that one of the plaintiffs has backed out and is now siding with the defendants does not necessarily mean that the suit must fail. The mere fact that one of the plaintiffs, namely, Murari Singh has deposed that he was never ready or willing to perform his part of the agreement since it was sham transaction, which was only executed to put a fear on defendant no.1 so as to restrict him to sell the property, cannot be accepted. The plaintiffs have averred in the plaint that they were ready and willing to fulfill their part of the contract. The plaintiffs have averred in the plaint that they were ready and willing to fulfill their part of the contract. One of the plaintiffs has proved this fact that he was ready and willing to fulfill his part of the contract and also proved it by way of evidence. In the opinion of the court, it is sufficient requirement of Section 16(c) of the Specific Relief Act and that it is not necessary that each of the plaintiffs should prove this fact by way of evidence. 13. The submission of the learned senior counsel for the appellants that in view of Section 45 of the Transfer of Property Act, the suit for specific performance could not be be decreed in so far as the share of Murari Singh is concerned since he had neither signed the vakalatnama nor had indicated his willingness and readiness to perform his part of the contract, in my opinion, is patently erroneous. The provision of Section 45 of the Transfer of Property Act is not attracted to the present facts and circumstances of the case. Section 45 only states that the interest inter se as between the several joint purchasers of an immoveable property will subject to contract between them be in the proportion in which they were entitled to the consideration for the purchase, and has nothing whatsoever to do with the method of creating common ownership or the manner in which several persons can become common owners in respect of a single item of property. 14. In any case, this plea is not available to the appellants purchasers. They have no right to raise this plea as held by the Supreme Court in Jugraj Singh & another Vs. Labh Sinngh & others AIR 1995 SC 945 in which it was held that a plea, namely, that the plaintiff was ready and willing to perform his part of the contract was not available to the purchasers defendants. 15. The learned senior counsel for the appellants vehemently contended that in view of the provision of Section 20 and 21 of the Specific Relief Act, the court below should have exercised its discretionary jurisdiction by compensating the plaintiffs under Section 21 sub-clause (5) of the Specific Relief Act and should not have decreed the suit for specific performance. In Parakunnam Veetill Joseph’s Son Mathew Vs. In Parakunnam Veetill Joseph’s Son Mathew Vs. Nedumbara Kuruvila’s Son and others AIR 1987 SC 2328, the Supreme Court held:- “14. Section 20 of the Specific Relief Act, 1963 preserves judicial discretion of courts as to decreeing specific performance. The court should meticulously consider all facts and circumstances of the case. The court is not bound to grant specific performance merely because it is lawful to do so. The motive behind the litigation should also enter into the judicial verdict. The court should take care to see that it is not used as an instrument of oppression to have an unfair advantage to the plaintiff.” 16. In the light of the aforesaid, no doubt, judicial discretion is given to the courts when applying in suits for specific performance. The court has to be careful and ensure that the agreement to sell is not used as an instrument of oppression in order to have unfair advantage to the plaintiff. In the present case, the plaintiff has filed a suit for specific performance on the basis of a registered agreement to sell. The question is that the plaintiffs have proved their readiness and willingness to perform their part of the contract. The vendor has also admitted the execution of the agreement to sell. The purchasers, namely, defendant nos.2, 3 & 4 are not the bonafide purchasers and their contention that they have purchased the land in good faith for valuable consideration and without notice cannot be believed. Under Section 3 of the Transfer of Property Act, a person is said to have notice of the fact when he actually knows that fact, or when, but for willful abstention from an enquiry or search which he ought to have made or gross negligence, he would have known it. Explanation II to the said Section states that any person acquiring any immovable property or any share or interest in any such property shall be deemed to have notice of the title, if any, of any person who is for the time being in actual possession thereof. Under Section 3 of the Transfer of Property Act, there is a statutory presumption of a notice arising against any person who acquires any immovable property or any share or interest therein of the title. 17. Under Section 3 of the Transfer of Property Act, there is a statutory presumption of a notice arising against any person who acquires any immovable property or any share or interest therein of the title. 17. In the present case, a specific finding has been recorded that the purchasers did not make any enquiry from the Sub Registrar Office with regard to the property in question and whether the sale deed or agreement to sell had been executed. No explanation has been given as to why the defendant did not make the requisite inquiry. In the absence of any inquiry, both the courts below concluded that the defendant nos.2, 3 & 4 had knowledge or deemed knowledge of the execution of the registered agreement to sell and inspite of having this knowledge, the said defendants chose to get the sale deed executed in their favour. The court below rightly came to the conclusion that the defendant nos.2, 3 & 4 were not the bonafide purchasers and, consequently, no discretion can be exercised in favour of the said defendants. This view of mine is fortified by a decision of the Supreme Court in Ram Niwas (dead) through LRs Vs. Smt. Bano & others 2000 AIR SCW 2996 and R. K. Mohammed Ubaidullah & others Vs. Hajee C. Abdul Wahab (D) by L.R.s and others 2000 AIR SCW 4794. Once the court comes to the conclusion that the defendants are not bonafide purchasers, no discretion can be granted under Section 20 or 21 of the Specific Relief Act in favour of the said defendants, otherwise, it would give an unfair advantage to the defendants and to the detriment of the plaintiffs. In such a scenario, the decree for specific performance had to be given and the discretion of payment of compensation would not be an adequate exercise of discretion. Consequently, the submission of the learned senior counsel for the appellants cannot be accepted. 18. In Kanshi Ram Vs. Om Prakash Jawal & others 1996 (4) SCC 593, the Supreme Court held that the courts under Section 20 of the Specific Relief Act, exercises its discretion in accordance with justice, equity, good conscience and fairness to both the parties. Consequently, the submission of the learned senior counsel for the appellants cannot be accepted. 18. In Kanshi Ram Vs. Om Prakash Jawal & others 1996 (4) SCC 593, the Supreme Court held that the courts under Section 20 of the Specific Relief Act, exercises its discretion in accordance with justice, equity, good conscience and fairness to both the parties. The said principles is squarely applicable to the present case and in view of the fact that the defendants are not bonafide purchasers, the court below has rightly exercised its discretion in granting a decree for specific performance. 19. The submission of the learned counsel for the appellant that the suit for specific performance could not be decreed unless and until the sale deed executed by defendant no.1 in favour of defendant no.2, 3 & 4 was cancelled first is bereft of merit. The judgment cited by the learned senior counsel for the appellants in Chikkathamaiah (supra) is not applicable to the present facts and circumstances of the case. In that case, the plaintiff had filed a suit for title and permanent injunction and the defendant raised a preliminary objection that the suit was not maintainable unless a relief for cancellation of the sale deed was asked for. The court below, after considering the matter, held that the relief of declaration and for permanent injunction could not be granted unless the sale deed was cancelled. 20. In Durga Prasad & another Vs. Deep Chand & others AIR 1954 SC 75, the Supreme Court held as under:- “42. In our opinion, the proper form of decree is to direct specific performance of the contract between the vendor and the plaintiff and direct the subsequent transferee to join in the conveyance so as to pass on the title which resides in him to the plaintiff. He does not join in any special covenants made between the plaintiff and his vendor; all he does is to pass on his title to the plaintiff. This was the course followed by the Calcutta High Court in Kafiladdin v. Samiraddin AIR 1931 Calcutta 67 (C) and appears to be the English practice. See Fry on Specific Performance, 6th Edn., p. 90, para 207; also Potter v. Sanders 1846 (67) ER 1057 (D). We direct accordingly.” 21. This was the course followed by the Calcutta High Court in Kafiladdin v. Samiraddin AIR 1931 Calcutta 67 (C) and appears to be the English practice. See Fry on Specific Performance, 6th Edn., p. 90, para 207; also Potter v. Sanders 1846 (67) ER 1057 (D). We direct accordingly.” 21. The Supreme Court was of the opinion that it was not necessary to pray for the cancellation of the sale deed and that the proper form of decree was to direct specific performance of the contract between the vendor and the plaintiff and direct the subsequent transferee to join in the conveyance so as to pass on the title which resides in him to the plaintiff. This view has been consistently followed since then and has been reiterated by the Supreme Court in Soni Lalji Jetha (deceased) through his L.Rs. Vs. Soni Kalidas Devchand & others AIR 1967 SC 978, Ramesh Chandra Chandiok & another Vs. Chuni Lal Sabharwal (dead) by his L.Rs. & others AIR 1971 SC 1238, Babu Lal Vs. M/s Hazari Lal Kishori Lal & others AIR 1982 SC 818, H.P.A. International Vs. Bhagwandas Fateh Chand Daswani & others AIR 2004 SC 3858 and Seenivasan Vs. Peter Jebaraj & another AIR 2008 SC 2052. In the light of the consistent stand taken by the Supreme Court, the submission of the learned senior counsel for the appellants is bereft of merit. 22. In view of the aforesaid, this court finds that the appeal of the appellants is devoid of merit and is dismissed accordingly. In the circumstances of the case, parties shall bear their own cost.