Supreme Court of India
DR. MANOHAR GANAPATHI RAVANKAR versus GURUNANDA RAIKAR on 15 April 2019
[2019] 6 S.C.R. 51
DR. MANOHAR GANAPATHI RAVANKAR
v.
GURUNANDA RAIKAR
(Civil Appeal No. 3415 of 2019)
APRIL 15, 2019
[DR. DHANANJAYA Y CHANDRACHUD AND
HEMANT GUPTA, JJ.]
Specific performance: Respondent-defendant agreed to sellthe schedule property for total sale consideration of Rs.30 lacs andwas paid earnest money of Rs.26000/- – At the time of agreement,there was a civil family dispute pending in respect of the scheduleproperty against him – The condition in the agreement was that thedefendant would settle the pending dispute within a period of sixmonths and if the dispute is not settled within six months, the timefor execution of sale deed would be extended by such time asmutually to be agreed upon by the parties – Appellant-plaintiff senta notice stating that as per his information, dispute in the familystood settled and expressed his readiness to pay the balance of theconsideration – Plaintiff later filed suit for specific performance –It was stated in the plaint that on demand made by defendant, afurther sum of Rs.6.75 lacs was paid to him – However, no date ofsuch payment was disclosed in the plaint – Trial court decreed thesuit and directed the plaintiff to pay balance amount of Rs.29.74lacs – Defendant filed appeal before High Court – High Courtpassed order of refund of Rs.7.01 lacs while declining the relief ofspecific performance of the agreement on the ground that theplaintiff has failed to prove that he was ready and willing to performhis part of the agreement – High Court further held that there wasnothing to show that as to when and how payment of Rs. 6.75 lacswas made out of balance sale consideration – On appeal, held:High Court erred in law in granting a decree for payment of Rs.7.01lacs more so when the High Court has returned a finding that theplaintiff was not ready and willing to execute the contract merelyon the basis that original title deeds might have been handed overto the plaintiff when sum of Rs. 6.75 lacs was said to have been
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Apaid by the plaintiff – In the notice issued by plaintiff there was noassertion of handing over of the documents of the title or paymentof Rs. 6.75 lacs – In fact, the plaintiff categorically stated in thenotice, his readiness and willingness to pay the balance saleconsideration amount of Rs. 29.74 lacs – There was no documentto prove payment of Rs. 6.75 lacs, except the bald statement of theBplaintiff – If payment of earnest money of Rs.26,000/- could bemade by cheque, then the payment of Rs. 6.75 lacs in cash is beyondany comprehension – Therefore, the entire story of payment of Rs.6.75 lacs at the time of handing over the title documents was whollyunbelievable – High Court erred in passing a decree for recoveryCof the said amount only on the basis of presumptions.
Disposing of the appeals, the Court
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Conclusion
Disposing of the appeals, the Court
HELD: 1.1 In the notice issued by plaintiff there was noassertion of handing over of the documents of the title or paymentof Rs. 6,75,000/-. In fact, the categorical assertion in the noticeDserved was that the Plaintiff was ready and willing to pay thebalance sale consideration amount of Rs. 29,74,000/-. There wasno document to prove payment of Rs. 6,75,000/-, except the baldstatement of the Plaintiff. There was no any other evidence toprove that sum of Rs. 6,75,000/- was paid by the Plaintiff and onEwhich date. The entire story of payment of Rs. 6,75,000/- at thetime of handing over the title documents is wholly unbelievable.The Plaintiff has not asserted such fact in the plaint or in thenotice served on 25.12.2006. The High Court erred in law inpassing a decree for recovery of the said amount only on thebasis of presumptions. The Plaintiff is not entitled to decree forFrelief of specific performance, in view of the finding recorded bythe High Court itself that he was not ready and willing to performhis part of the contract. The appeal filed by the Plaintiff isdismissed whereas, that of the Defendant is allowed. Since thePlaintiff has admittedly paid a sum of Rs. 26,000/-, the DefendantGis ordered to pay such amount to the Plaintiff to settleequities along with simple interest at the rate of 9 per cent perannum from the date of payment till the date of realisation.[Para 11-14][57-A-E]
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3415of 2019.
From the Judgment and Order dated 17.02.2016 of the HighCourt of Karnataka at Bengaluru in R.F.A. No. 188 of 2013.
With
Civil Appeal No. 3416 of 2019.
Basava Prabhu Patil, Sr. Adv., Anand Sanjay M. Nuli, DharmSingh, Suraj Kaushik, Nanda Kumar K.B., M/S. Nuli & Nuli, G. Balaji,Advs. for the Appellant.
Harsh Kaushik, Harsh Prakash, G. Balaji, Advs. or the Respondent.
The Judgment of the Court was delivered by HEMANT GUPTA, J.
1. Civil Appeal No. 3415 of 2019 is by the Plaintiff aggrievedagainst the judgment and order dated 17.02.2016 passed by the HighCourt of Karnataka at Bengaluru declining relief for specific performanceof the agreement of sale of the schedule property but granting a decreefor recovery of Rs. 7,01,000/- along with interest at the rate of 12 percent per annum from the date of payment till date of realisation. CivilAppeal No. 3416 of 2019 is by the Defendant aggrieved against thedecree for payment of Rs. 6,75,000/- by the same judgment.
2. Hereinafter for facility of reference, the parties will be describedas per their status before the trial court. The Defendant is the owner ofnon-agricultural immovable property situated in Kadri Village, Kadri Ward,Mangalore Taluk, within the Mangalore City Corporation and comprisedin Rs. No. 72-11, bearing T.S. No. 1578-11G measuring 7.25 cents or0.0725 acre with residential buildings bearing Door No. 3-3-2429, 3-30-2430, shop premises bearing Door No. 3-30-2431, which is moreparticularly described in the schedule to the plaint and hereinafter referredto as “the schedule property”.
3. The case of the Plaintiff is that on 21.07.2006, the Defendantentered into a written agreement with him for sale of the scheduleproperty for a total sale consideration of Rs. 30,00,000/-. A sum of Rs.26,000/- was paid as earnest money. At the time of agreement, theDefendant has a civil dispute (OS No. 196/2005) pending against himfiled by his brother. The condition in the agreement was that theDefendant will settle the pending dispute within a period of six months.
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ABut if the dispute is not resolved within six months, the time for theexecution of the sale deed shall be extended by such time as mutually tobe agreed upon by the parties. Some of the terms of the agreement readas under:
“1. That the 2[nd] PARTY PURCHASER has agreed to pay a totalBsale consideration of Rs.30, 00, 000/- (Rupees Thirty Lakhs Only)towards the agreed sale of schedule property by the 1[st] PARTYVENDOR to the 2[nd] PARTY PURCHASER and out of abovesale consideration, the 2[nd] PARTY PURCHASER has paid a sumof Rs. 26, 000/- (Rupees Twenty-Six Thousand Only) to the 1[st]PARTY VENDOR by means of cheque dated 21.07-2006 bearingCNo. 918333 drawn on Syndicate Bank, Fr. Muller’s CharitableInstitution Branch, Mangalore, by way of advance saleconsideration, the receipt of which the 1[st] PARTY VENDORhereby acknowledges. The balance sale consideration of Rs.29,74,000/- (Rupees Twenty Nine Lakhs Seventy Four ThousandDonly) is agreed to be paid at the time of execution and registrationof the intended Sale Deed.
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5. The 1[st] PARTY VENDOR shall execute the Sale Deed within6 months (Six Months) from the date of execution of thisEAgreement, which however can be altered only by mutual consentin writing and signed by both the parties.
6. In case, the 1[st] PARTY VENDOR fails to perform his part ofthis agreement, he shall refund the entire advance saleconsideration of Rs. 26,000/-(Rupees Twenty Six Thousand Only)Falong with interest at 12% per annum and in addition to that heshall also pay a further sum of Rs. 5,000/- (Rupees Five ThousandOnly) by way of pre-estimated liquidated damages and accordinglyin such event, the 2[nd] PARTY PURCHASER shall be entitled torecover the said amounts from the 1[st] PARTY VENDOR, includingGthe interest and cost if any incurred, for recovery of the same.”
4. The Plaintiff served a notice on 25.12.2006 raising a grievancethat the Defendant has not informed him about the position of the civilsuit but as per his information, dispute in the family stands settled. Itwas stated in the notice that he is ready with balance sale considerationof Rs. 29,74,000/-. The relevant extract from the notice is as under:H
“I have kept the balance sale consideration Rs.29, 74, 000/- readyand you can execute the sale deed at any time and to receive thebalance sale consideration without seeking any further time andto hand over the actual physical possession. I request you to gothrough the accompanying draft sale deed which is sent forapproval and request you to furnish upto date encumbrancecertificate, taxes paid receipt, electricity and water consumptionbill paid receipts so as to execute the sale deed within this weeki.e. on or before 31.12.2006.”
5. The Plaintiff later filed a suit OS No. 350/2007 on or about10.12.2007 praying for the relief of specific performance of the agreementdated 21.07.2006. In the plaint, the Plaintiff pleaded that Defendant hasdemanded and received a further sum of Rs. 6,75,000/-. However, nodate of such payment of said amount was disclosed in the plaint.
6. The Plaintiff filed an affidavit of Chief Examination on21.01.2010, but again there is no mention of payment of Rs. 6,75,000/-.However, on 18.12.2010 another affidavit was filed by way of anAdditional Chief Examination to the effect that sum of Rs. 6,75,000/-was paid but without disclosing any date of payment. It may be noted atthis stage that in the agreement, the parties have agreed to extend thetime by mutual consent but there is no endorsement either on theagreement in question or by way of written note separately except,the assertion by the Plaintiff in the plaint that he has paid sum ofRs. 6,75,000/-
7. The learned trial court on 17.09.2012 decreed the suit grantingdecree of the specific performance of agreement of sale dated21.07.2006 for a consideration of Rs. 30,00,000/-, and to get RegisteredSale Deed executed by paying the balance sale consideration amount ofRs. 29,74,000/-. It is the Defendant who preferred appeal against thedecree granted in which, the High Court has passed an order of refundof Rs. 7,01,000/- while declining the relief of specific performance ofthe agreement.
8. The High Court inter alia held that the Plaintiff has failed toprove that he was ready and willing to perform his part of the agreement.The High Court further held that there is nothing on record to show thatas to when and how payment of Rs. 6,75,000/- was made out of balancesale consideration. The High Court then observed that it may be a loan AB
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Atransaction as the original title deeds were handed over to the Plaintiff.Thus, the Court granted a decree for recovery of Rs. 7,01,000/- for thereason that another sum of Rs. 6,75,000/- must have been paid at thetime when the original title deed was handed over to the Plaintiff.
9. We find that the High Court erred in law in granting a decreeBfor payment of Rs. 7,01 000/- more so when the High Court has returneda finding that the Plaintiff was not ready and willing to execute the contractmerely on the basis that original title deeds might have been handed overto the Plaintiff when sum of Rs. 6,75,000/- is said to have been paid bythe Plaintiff.
C10. Though in the additional affidavit of Additional ChiefExamination, the Plaintiff asserted that original title deeds were handedover when he paid a sum of Rs. 6,75,000/- but in the plaint, there is nosuch averment. In fact, the Plaintiff has filed earlier suit for injunctionwhich was not pursued to file the suit for specific performance. ThePlaintiff has averred to the following effect in the present suit for specificDperformance:
“2. After the plaintiff having entered into the contract for thesale of the plaint ‘A Schedule property, the defendant used todemand and collect money from the plaintiff and the plaintiff havingpaid in good faith and the defendant had received in all Rs 6,75,000/- from the plaintiff out of the balance sale consideration of Rs.29,74,000/- and had handed over the original title documents relatingto the plaint ‘A’ Schedule property. The plaintiff was and is readyand willing to perform his part of contract, i.e. to pay the balancesale consideration and get the registration of the sale deed in hisfavour. By letter dtd. 25-12-2006, the plaintiff had even conveyedhis readiness and willingness to register the sale deed by payingthe balance sale consideration and sent draft sale deed. Thedefendant received the said notice without demur. The defendantthough showed his willingness to execute the sale deed expressedhis in ability to settle the pending litigation with his brother. Assuch the plaintiff even approached the brother of the plaintiff soas to have a amicable settlement between them. In furtheranceof the said contract for the sale of plaint ‘A Schedule property,the plaintiff had got measured the property and made arrangementfor the repair of the building situated in the said property.”
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11. Still further, in the notice dated 25.12.2006, there is noassertion of handing over of the documents of the title or payment ofRs. 6,75,000/-. In fact, the categorical assertion in the notice served isthat the Plaintiff is ready and willing to pay the balance sale considerationamount of Rs. 29,74,000/-. There is no document to prove payment ofRs. 6,75,000/-, except the bald statement of the Plaintiff. There is noany other evidence to prove that sum of Rs. 6,75,000/- was paidby the Plaintiff and on which date. If payment of earnestmoney of Rs.26,000/- could be made by cheque, then the payment ofRs.6,75,000/- in cash is beyond any comprehension.
12. Therefore, the entire story of payment of Rs. 6,75,000/- at thetime of handing over the title documents is wholly unbelievable. ThePlaintiff has not asserted such fact in the plaint or in the notice served on25.12.2006. The High Court erred in law in passing a decree for recoveryof the said amount only on the basis of presumptions.
13. In view of the above, we find that the Plaintiff is not entitled todecree for relief of specific performance, in view of the finding recordedby the High Court itself that he was not ready and willing to perform hispart of the contract.
14. In view of the above, the appeal filed by the Plaintiff isdismissed whereas, that of the Defendant is allowed. Since the Plaintiffhas admittedly paid a sum of Rs. 26,000/-, we order that the Defendantshall pay such amount to the Plaintiff to settle equities along with simpleinterest at the rate of 9 per cent per annum from the date of payment tillthe date of realisation. The appeals stand disposed of accordingly.
Devika Gujral
Appeals disposed of.
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