JUDGMENT JUDGMENT :–– This regular First Appeal is by the defendants 2 and 3 challenging the judgment and decree passed by the II Additional Civil Judge (Sr. Dn.), Dharwad, in O.S. No. 161/1996. The suit was filed by the plaintiff for the relief of specific performance and in the alternative, for refund of earnest money and also for possession. 2. The suit properties –– four items, are together measuring about 14 acres 34 guntas in Sy. Nos.85/2, 85/3A, 85/3B and 85/4 situate at Sirur village of Navalgund Taluk. The suit lands are adjacent to each other having its boundaries mentioned in the Schedule. The suit lands are situated nearer to Hireulligeri village where the plaintiff is residing. The plaintiff having disposed of his own land situated at his original village, was settled at Hireulligeri village and was in search of the land near Hireulligeri. In the year 1994, the family of defendants 1 to 3 was in financial difficulty and wanted to sell the lands. The plaintiff approached the defendants who agreed to sell the suit lands for sale consideration of Rs. 1,08,750/- and entered into an agreement to sell. The said agreement was signed by defendant No. 2 in his individual capacity as well as in the capacity of guardian of defendant No. 3 who was minor then, by receiving earnest money of Rs. 25,000/-. It was agreed that the remaining amount was to be paid at the time of registration and defendants also agreed to equally bear the expenses of sale deed and agreed to obtain permission from the competent authority. The plaintiff was put in possession of the suit lands on the date of agreement itself and the plaintiff spent huge sums of money to improve the lands which were full of thorny bushes and jali trees and made the land cultivable. It is contended that the plaintiff was ever ready and willing to perform his part of the contract, and had requested the defendants on several occasion to execute the sale deed by receiving the balance sale consideration and also persuaded them to do so through village elders. But the defendants went on postponing the same. 3. The suit lands were Walikarki lands which were re-granted by the Government to defendants and there was no restriction for alienation, except that 15 times of the assessment has to be paid to Government for obtaining permission for alienation. But the defendants went on postponing the same. 3. The suit lands were Walikarki lands which were re-granted by the Government to defendants and there was no restriction for alienation, except that 15 times of the assessment has to be paid to Government for obtaining permission for alienation. It is the case of plaintiff that the defendants in order to cause wrongful loss to the plaintiff, sold Sy. No. 85/3A at Sl. No. 2 of the plaint to defendant No. 4 on 16-11-1994 behind the back of plaintiff and without the knowledge of the plaintiff. Defendant No. 4 is also stated to be the resident of Ulligeri village and he also knew about the earlier agreement of sale entered into between the plaintiff and defendants 1 to 3. As such, it is stated, defendant No. 4 is not a bona fide purchaser and does not derive any right under the Sale Deed. 4. When the plaintiff came to know about the alleged sale in favour of defendant No. 4, he got issued a registered notice on 28-6-1996, the service of which the defendants managed to avoid. Once again, another notice was issued on 24-8-1996 the service of which was also avoided by the defendants. Thereafter, notice was sent Under Certificate of Posting, which was received and defendants 2 and 3 got issued a reply denying the execution of the sale agreement. As such the suit was filed seeking the relief of specific performance of contract and such other relief. 5. According to defendants, the suit land has been alienated without prior permission of the Government. As the defendants 1 and 2 were in need of money they had approached the plaintiff who was ready to advance the loan by taking a promissory note and accordingly, the 2nd defendant by receiving a sum of Rs. 25,000/-, executed the agreement offering the suit land as security. According to the defendants, the deed dated 9-5-94 was only a promissory note as security for the loan and the defendants would not have sold the entire suit lands for a meagre amount. The defendants have no intention to sell the suit lands. It is contended further that the plaintiff has never been put in possession of the suit lands and that defendant No. 3 was minor at the time of execution of the alleged sale deed. The defendants have no intention to sell the suit lands. It is contended further that the plaintiff has never been put in possession of the suit lands and that defendant No. 3 was minor at the time of execution of the alleged sale deed. Therefore, none of the other defendants are entitled to execute the sale deed when the minor defendant No. 3 was having his legitimate share in the suit lands. Hence, the defendant No. 2 sought for dismissal of the suit. 6. Defendant No. 4 has filed his written statement contending that defendants-2 and 3 were in urgent need of money for improvement of other lands and for education of defendant No. 3 and also for repayment of debt incurred by them. As such they offered to sell Sy. No. 85/3A measuring 3 acres 22 guntas at Sl. No. 2 of the plaint and defendant No. 4 purchased the said land for Rs. 50,000/-. Accordingly, a registered sale deed dated 16-11-1994 was executed in favour of defendant No. 4 who got his name entered in the records. Thereafter, defendant No. 4 got entered the names of two of his sons in the Record of Rights. Defendant No. 4 contends that at the time of execution of sale deed he was not aware of the earlier agreement to sell between the plaintiff and defendants. As such defendant No. 4 is a bona fide purchaser for valuable consideration of the said land without notice of prior agreement. Therefore, defendant No. 4 is not liable to execute the sale deed in favour of plaintiff along with other defendants. 7. Based on the above pleadings of the respective parties, the trial Court framed the following 5 issues and 4 additional issues : 1. Whether the plaintiff proves that defendants 1 to 3 have agreed to sell all suit properties to the plaintiff for consideration amount of Rs. 1,08,750/- under the agreement to sell dated 9-5-94? 2. Whether the plaintiff further proves that defendants 1 to 3 have received earnest money of Rs. 25,000/- from the plaintiff? 3. Whether the plaintiff further proves that he is in possession of all suit properties from 9-5-94? 4. Whether defendant No. 4 proves that he is a bona fide purchaser for valuable consideration amount of Rs. 50,000/- and the suit properties at Sl. 25,000/- from the plaintiff? 3. Whether the plaintiff further proves that he is in possession of all suit properties from 9-5-94? 4. Whether defendant No. 4 proves that he is a bona fide purchaser for valuable consideration amount of Rs. 50,000/- and the suit properties at Sl. No. 2 of the plaint without the knowledge of previous transaction between plaintiff and defendants 1 to 3? 5. What relief and what Order ? Addl. Issues dt. 9-10-02 : 1. Whether the document Nos. 1 and 2 prove that the transaction between them and the plaintiff was a money transaction and in fact the impugned deed styled as agreement for sale was executed a security document for the loan? 2. Whether the plaintiff proves that he was and always has been ready and willing to perform his part of contract ? 3. Whether the plaintiff is entitled to get the discretionary relief of specific performance sought for? 4. In the alternative, whether the plaintiff is entitled to recover Rs. 25,000/- with interest ? 8. The Trial Court answered the issues in favour of the plaintiff and ordered for decree of specific performance and also directed the defendants 2 and 3, since defendant No. 1 died, to execute the sale deed in respect of the suit lands after getting necessary permission from the competent authority in favour of the plaintiff by receiving balance sale consideration of Rs. 83,750/- within three months and set aside the sale deed executed by defendants 2 and 3 in favour of defendant No. 4. The trial Court also directed defendants 4 to 6 to join defendants 2 and 3 in executing the sale deed in favour of plaintiff in respect of suit lands bearing Sy. No. 85/3b to the extent of 3 acres, 23 guntas to Sirur village. 9. Being aggrieved the defendants 2 and 3 are before this Court. 10. Heard. 11. According to the learned counsel for the appellants/defendants 2 and 3, there was no concluded and binding contract between the parties. Of course, the defendants were in need of money. As such the alleged document was executed by way of security to the loan borrowed from the plaintiff. The terms of agreement are uncertain and it was not intended to be acted upon between the parties. Of course, the defendants were in need of money. As such the alleged document was executed by way of security to the loan borrowed from the plaintiff. The terms of agreement are uncertain and it was not intended to be acted upon between the parties. It is submitted that at the time of entering into an agreements defendant No. 3 was minor and he was not represented by his natural guardian and father and therefore, the alleged agreement is not binding on defendant No. 3. This fact has been overlooked by the learned trial Judge. Further it is contended that the plaintiff was aware of the fact that the suit property was a Government land granted to defendants' family as Walikarki land and the alienation of the said lands was permitted subject to payment of 15 times the land revenue and with the permission of the Revenue Authority. The property sold in favour of defendant No. 4 was for urgent need of money, therefore, they sold the land to an extent of 3 acres 22 guntas at Sl. No. 2 for Rs. 50,000/- by executing a registered sale deed dated 16-11-1994. According to defendants, the sale consideration as mentioned in the sale deed is not adequate. It is submitted that the order of Trial Court is without application of mind, without exercising the discretion properly having regard to the nature of transaction and the document executed is by way of security for loan and hence, the impugned judgment and decree is liable to be set aside. 12. Per contra, learned counsel for respondent-plaintiff contended that after taking possession of the suit land from the defendants in pursuance of agreement to sell by the defendants, the plaintiff invested huge sums of money to improve the suit land. But, the defendants taking advantage of the lands having become fertile, offered to sell it to 4th defendant instead of handing over possession of the lands to the plaintiff by executing the sale deed as per the terms of the agreement. Hence, he prays to dismiss the appeal. 13. After going through the material evidence on record, I find that the Trial Court taking into consideration the conduct of defendants 2 and 3, has rightly decreed the suit land for specific performance and directed the defendants to execute the sale deed after taking permission from the Government as per the terms of the agreement. 13. After going through the material evidence on record, I find that the Trial Court taking into consideration the conduct of defendants 2 and 3, has rightly decreed the suit land for specific performance and directed the defendants to execute the sale deed after taking permission from the Government as per the terms of the agreement. The property sold in favour of defendant No. 4 is without seeking permission from the Government and defendant No. 3 being a minor at the time of execution of sale, was not represented by his natural guardian and father. Further, the agreement to sell Ex. P.8 contains a clause to the effect that if the sale deed is not executed within three years, then it was agreed to execute another agreement to sale. This recital clearly shows that there was no concluded and binding contract between the parties. 14. Having regard to the conduct of defendants 2 and 3 that they have sold the property to defendant 4, the plaintiff filed a suit for specific performance. The very conduct of defendants 2 and 3 in entering into sale agreement with plaintiff is much prior to the sale entered into in favour of defendant 4 by defendants 2 and 3. The contents of Ex. P.8 have been proved by examining the scribe of Ex. P8, which depict that the defendants agreed to sell the suit lands to the plaintiff for a total consideration of Rs. 1,08,750/-. Further, on perusal of the said documents, the learned trial Judge has held that there is a recital to the effect that if the suit lands were to be alienated, certain amount has to be paid to the holder of the lands to the Government for obtaining necessary permission for alienation, and the defendants themselves have agreed that they will pay the necessary amount in respect of the suit lands before executing the sale deed. Therefore, the Trial Court has rightly decreed the suit. 15. The following points for determination would arise for consideration : (i) Whether the trial Court is justified in holding that the plaintiff/defendants 2 and 3 agreed to sell the suit property for consideration of Rs. 1,08,750/- and the defendants received earnest money of Rs. 25,000/- from the plaintiffs? (2) Whether the trial Court is justified in holding that the plaintiff proved his possession of the suit property from 9-5-1994? 1,08,750/- and the defendants received earnest money of Rs. 25,000/- from the plaintiffs? (2) Whether the trial Court is justified in holding that the plaintiff proved his possession of the suit property from 9-5-1994? (3) Whether the Trial Court justified in holding that defendant No. 4 is not a bona fide purchaser in respect of the suit property at Sl. No. 2 and that he had knowledge of the previous transaction between plaintiff and defendants 1 to 3 in respect of the same suit property? (4) Whether the trial Court is justified in holding that the agreement entered into between the plaintiff and defendants 1 to 3 was not a money transaction by way of security but it was agreement to sell. (5) Whether the trial Court justified in holding that the plaintiff was ready and willing to perform his part of contract ? (6) Whether the trial Court is justified in exercising jurisdiction in decreeing the suit for specific performance of the agreement to sell? (7) What order ? 16. The affidavit filed by plaintiff by way of evidence, clearly indicates that defendants 1 and 2 entered into the agreement to sell the suit land for their family necessity. The sale negotiations took place in the presence of elders of both the villages and defendant No. 1 and his two sons. After negotiation, the defendants 1 to 3 agreed to sell suit lands for consideration of Rs. 1,08,750/- to the plaintiff. Defendant No. 2 purchased the stamp paper and gave instructions to the scribe-PW. 4 to write the sale agreement and after the scribe read over the contents of the document to defendant No. 2, defendant No. 2 put his signature. Thereafter, the attesting witnesses P.Ws. 2, 3 and Balanagouda Sirur put their signatures to the sale agreement Ex. P.8. All the attesting witnesses speak about the execution of the sale agreement in favour of plaintiff and that a sum of Rs. 25,000/- was received by defendant No. 2 as earnest money. Though it is admitted by P.W. 2 about the existence of some practice in their village regarding execution of agreement deed for security for loan, nothing has been elicited in the cross-examination that this agreement is in lieu of security of loan and not intended to be acted upon. 17. 25,000/- was received by defendant No. 2 as earnest money. Though it is admitted by P.W. 2 about the existence of some practice in their village regarding execution of agreement deed for security for loan, nothing has been elicited in the cross-examination that this agreement is in lieu of security of loan and not intended to be acted upon. 17. It appears one of the defendant witnesses, viz., D.W.2 Balanagouda, who also signed the agreement as attesting witness, has stated that the land in question was granted by the Government in favour of defendant No. 1 as ‘Walikarki’ land. The sale agreement is of the year 1994 and as per the terms of the agreement, it was for the defendants to obtain permission from the concerned authorities and to sell the property in favour of the plaintiff. Even in Ex. P.8 it is specifically mentioned that the expenses for securing permission from the authorities has to be borne by the holder of the land. This fact also emphasized that Ex. P.8 was intended to be acted upon and not merely as security for loan. Even there is specific mention in Ex. P.8 that the defendants agreed to pay necessary amount to Government before executing the sale deed. As such, restriction, if any, by the Government has to be got cleared by the defendants by paying necessary fees to the Government and there is no impediment for alienating the property when the agreement is entered into in the year 1994, i.e. nearly after completion of 16 years from the date of grant and after 15 years of the date of agreement of sale. Furthermore, the property was to be sold to plaintiff after securing necessary permission from the Government. 18. The evidence of P.Ws. 1 to 3 apart from recital in Ex. P. 8, makes it clear that there is intention to deliver possession and the transfer of property has been made in favour of plaintiff. In the circumstances, rightly the trial Court has come to the conclusion that the property has been parted with by defendants. 19. The stand of the 4th defendant in the written statement filed by him is that he was bona fide purchaser without notice. He has averred that Sy. No. 84/3A at Sl. No. 2 measuring 3 acres 22 Guntas is sold in his favour after the agreement was entered into with the plaintiff. 19. The stand of the 4th defendant in the written statement filed by him is that he was bona fide purchaser without notice. He has averred that Sy. No. 84/3A at Sl. No. 2 measuring 3 acres 22 Guntas is sold in his favour after the agreement was entered into with the plaintiff. Moreover, defendant No. 4 has not entered into witness box to defend his case. In that view of the matter, as it is the specific contention of defendant 4 that he also resident of Shirur village, necessarily it speaks to the fact of his deemed knowledge of transaction between the plaintiff and defendants and the stand of defendant No. 4 that his purchase of suit land in breach of contract with plaintiff and defendants 1 to 3 is without notice, cannot be accepted. Accordingly, the trial Court has rightly held that the purchase made, if any, by defendant No. 4 cannot be without notice. 20. Further, after the plaintiff was put in possession of suit lands he is said to have spent huge sums of money to improve the lands to make them cultivable. The defendants 2 and 3 in order to make wrongful gain, though having knowledge about the execution of sale agreement Ex P.8 in favour of plaintiff, sold the property in Sy. No. 85/3A in favour of defendant No. 4. As such, it is to be held, as is rightly held by the trial Court, the suit properties were sold in favour of plaintiff by defendants 2 and 3 not as security for loan and also the sale made in favour of defendant No. 4 was with an intention to secure higher profits. The very fact that the defendants 2 and 3 sold the property also adds to the defence of the plaintiff that, defendants 2 and 3 committed breach of contract not only for money but also in not coming forward to execute the sale deed by obtaining necessary permission from the Government. I do not find any illegality in the judgment passed by the trial Court. 21. It appears the transaction has taken place in the year 1994. Out of agreed sale consideration of Rs. 1,08,750/- plaintiff paid Rs. 25,000/- as earnest money to the defendants. The said agreement is dated 3-5-1994 on which day itself the plaintiff was put in possession of the suit lands. 21. It appears the transaction has taken place in the year 1994. Out of agreed sale consideration of Rs. 1,08,750/- plaintiff paid Rs. 25,000/- as earnest money to the defendants. The said agreement is dated 3-5-1994 on which day itself the plaintiff was put in possession of the suit lands. Thereafter, on 16-11-1994 the defendants have said the land in Sy. No. 85/3A measuring 3 acres 22 guntas for Rs. 50,000/- to defendant No. 4. It is pertinent to note that, since a substantial amount of Rs. 75,000/- has been obtained by the defendants 1 to 3 at the relevant point of time, no hardship would be caused to defendants 1 to 3 in executing the sale deed in favour of plaintiff by receiving the balance sale consideration. The defendants 2 and 3/appellants herein, are directed to execute the sale deed in favour of plaintiff in respect of remaining extent of suit lands, after deducting an extent of 3 acress 22 guntas alleged to have been sold in favour of defendant No. 4. It is for defendants 2 and 3 to secure permission from the Government and to execute the sale deed in favour of the plaintiff within three months from today failing which, it is for the trial Court to execute the sale deed in favour of the plaintiff in respect of the suit lands by excluding the extent of suit land sold in favour of defendant No. 4. The points raised are answered accordingly. 22. The appeal is allowed in part. The order of trial Court setting aside the sale in favour of defendant No. 4 is set aside. The plaintiff is directed to deposit the balance sale consideration of Rs. 83,750/- within three months from the date of the this order and defendants 2 and 3 are hereby directed to execute the sale deed in favour of the plaintiff as directed. Parties to bear their costs. Appeal partly allowed.