Mr. Nileshsingh J. Patil, Advocate for v. Natu

Legal Reasoning

SA-382-2023-final.odtIN THE HIGH COURT OF JUDICATURE OF BOMBAYBENCH AT AURANGABADSECOND APPEAL NO. 382 OF 2023Shivaji S/o Vithalrao VilegaveAge 55 yrs., Occu. Service,R/o. Subhash Nagar, Kawale – Patil Apartment,Barshi Road, Latur … APPELLANT [Original Defendant]VERSUSMadhav Gurunath BirajdarAge 59 yrs., Occu. Service,R/o. Sawewadi, Latur,Tq. & Dist. Latur… RESPONDENT[Original Plaintiff].…Mr. Nileshsingh J. Patil, Advocate for appellant Mr. Sharad V. Natu, Advocate for respondent .…CORAM: Y. G. KHOBRAGADE, J.DATE: 27 MARCH 2024O R D E R :- 1. Heard Mr. N. J. Patil, learned Counsel appearing forthe appellant and Mr. S. V. Natu, learned Counsel appearing forthe respondent.2.By the present appeal under Section 100 of the Codeof Civil Procedure, the appellant/ori. Defendant challenged thejudgment and decree dated 31.01.2023 passed by the learned 1 of 11 (( 2 ))SA-382-2023-finalDistrict Judge-2, Latur, in Regular Civil Appeal No. 16 of 2018 therebyaffirmed the judgment and decree dated 19.07.2014 passed by thelearned 3rd Joint Civil Judge Senior Division, Latur in Special CivilSuit No. 93 of 2012. 3.Present appellant is the original defendant and therespondent is the original plaintiff in Special Civil Suit No. 93 of2012. For the sake of brevity, I would like to refer the parties to thepresent appeal in their original capacity as Plaintiff and defendant.4.Brief facts giving rise to the plaintiff’s case are that, on27.11.2009, the defendant entered into an agreement with theplaintiff to sale the property bearing Plot Nos. 7 & 8 admeasuring 30X 50 ft., situated in Survey No. 233 within the limit of LaturMunicipal Corporation. Consideration amount of Rs.8,00,000/- wasfixed. At the time of execution of said agreement, the plaintiff paidRs.3,51,000/- as earnest money, which has been accepted by theDefendant. Accordingly, an Agreement to sale was reduced in writing.The defendant had agreed to execute sale-deed on or before30.06.2010 on accepting remaining consideration amount at the timeof execution of the sale-deed. According to the plaintiff, though hewas ready and willing to execute the sale-deed, but the defendant 2 of 11 (( 3 ))SA-382-2023-finalavoided to execute sale-deed in his favour. Therefore, the plaintiffissued the legal notice, calling upon the defendant to execute sale-deed in his favour by accepting balance consideration amount. Thesaid notice was duly served upon the defendant, but it was notreplied. Therefore, the plaintiff has filed a suit and thereby prayed fordecree of specific performance of contract or in alternate prayed forrefund of earnest money including incidental relief.5.Though, the defendant served with the notice, but hefailed to appear and did not file written statement. Therefore, videorder dated 25.11.2013, the suit was proceeded ex parte against thedefendant. 6.In order to prove the claim, the plaintiff adducedevidence. After conclusion of trial, on 19.07.2014, the learned TrialCourt passed the judgment and decree and held that, the defendanthad agreed to sale suit plots to the plaintiff for the considerationamount of Rs.8,00,000/-, out of which the defendant received earnestmoney to the tune of Rs.3,51,000/- and though, the plaintiff/Vendeeis ready and willing to perform his part of contract, but thedefendant/vendor failed to perform his part of contract. Therefore,decree of specific performance has been passed and defendant was 3 of 11 (( 4 ))SA-382-2023-finaldirected to execute sale-deed in respect of the suit property in favourof the plaintiff within a period of two months therefrom. 7.Being aggrieved by the said judgment and decree, thedefendant/respondent preferred first appeal bearing R.C.A. No.16 of2018, before the learned District Judge-2, Latur. After hearing boththe sides as well as on re-appreciation of evidence, the learned firstappellate Court, passed the impugned judgment and decree dated31.01.2023 and affirmed the judgment and decree of the trial Court.8.The learned Counsel appearing for the appellant/defendant, vehemently canvassed that the agreement to sale Exh.24 isnot registered one and also no sufficient stamp duty has been paid.Therefore, Un-registered Agreement to sale Exh.24 is not admissiblein evidence. Both the Courts below ought not to rely on saidAgreement and testimony of the plaintiff could have been discardedand the suit ought to have dismissed. 9.It is further canvassed that, both the Courts below failedto consider that the respondent/plaintiff has not made any efforts forexecution of the sale-deed within stipulated period as agreed.Therefore, the plaintiff’s suit ought have been dismissed, however, 4 of 11 (( 5 ))SA-382-2023-finalboth the Courts below failed to consider this aspect of the matter.Therefore, the impugned judgment and decree passed by the trialCourt and which was affirmed by the first appellate Court needs to bequashed and set aside. 10.The learned Counsel for the appellant canvassed theplaintiff issued a notice after lapse of two and half (2 ½ ) years,however, both the Courts below failed to consider this fact and passedthe decree, which is not sustainable in the eyes of law. 11. To buttress this submissions, the learned Counselappearing for the appellant places reliance on the case of P.Daivasigamani Vs. S. Sambandan – [2022] 18 S.C.R. 199.12.Per contra, the learned Counsel appearing for therespondent/plaintiff supported the judgment and decree passed byboth the Courts below and submits that as per the agreement to saledated 27.11.2009 (Exh.24), the defendant has agreed to sale his plotsbearing Nos. 7 and 8 admeasuring 30 X 50 ft. The defendant hadagreed for consideration amount of Rs.8,00,000/- and the plaintiffagreed to pay the said amount. The plaintiff paid Rs.3,51,000/- asearnest money to the defendant at the time of execution of the 5 of 11 (( 6 ))SA-382-2023-finalagreement. As per the terms and conditions of the agreement, thedefendant has to execute registered sale-deed in favour of the plaintiffon or before 30.06.2010 on accepting balance consideration amount.The agreement to sale Exh. 24 duly notarized before the PublicNotary in presence of two attesting witness. 13.Though the defendant duly served with the notice, but hefailed to appear before the trial Court and not contravened thepleadings of the plaintiff. Ultimately, suit proceeded exparte. Not onlythis, but the plaintiff himself examined at Exh.41 and examined theattesting witness Vaijnath Chawale PW-2 at Exh.24. The plaintiffproved agreement to sale Exh.24, office copy of legal notice dated28.09.2010 Exh.39, postal receipt and acknowledgment Exh.20 and21 respectively.14.The Agreement To sale Exh.24 bears the signature of theplaintiff and defendant as well as of two attesting witnesses, which isregistered before the Public Notary. The payment of receipt isappended with the agreement Exh.24. Therefore, it proves that therewas a concluded contract between the plaintiff and defendant withinthe meaning of Section 10 of the Indian Contract Act. As per theterms and conditions of Agreement sale Exh.24, the plaintiff paid 6 of 11 (( 7 ))SA-382-2023-finalRs.3,51,000/- to the defendant and executed agreement Exh.24 infavour of the plaintiff for sale of suit property in consideration ofRs.8,00,000/-. Further, as per the recital of agreement Exh.24, thedefendant had agreed to execute sale-deed in favour of the plaintiffon or before 30.06.2010. However, the defendant failed to executethe sale-deed. Ultimately, the plaintiff issued legal notice Exh.39,which was duly served upon the defendant under postalacknowledgment Exh.21. The Defendant has not denied service oflegal notice Exh. 39 and no any defence was set out for non executionof sale deed in favour of the plaintiff. 15.Since, the Defendant did not file Written Statement andnot contravened pleading set out in the suit, therefore for the firsttime in Second Appeal it is not permissible for the defendant tochallenge the agreement being not enforceable on ground that it isUnregistered document.16. Sec. 17 of the Registration Acts provides compulsoryregistration of documents if the immovable property more than onehundred rupees or upwards is involved, under the non-testamentaryinstruments which purport or operate, create, declare,assign,limit orextinguish, whether in present or in future any right, title or interest, 7 of 11 (( 8 ))SA-382-2023-finalwhether vested or contingent requires to be registered. Section 17 ofthe Registration Acts enlists the documents for which registration iscompulsory, such as sale deeds and rent agreements. However, it doesnot provides about compulsorily registration of the Agreement to sale.Needless to say that, even if the agreement reduced in writing inpresence of attesting witnesses is sufficient to prove the concludedcontract between the parties within the meaning of Section 10 of theIndian Contract Act. 17. Section 10, Section 16 and Section 20 of the SpecificRelief Act provides as under:-“Section 10. - Cases in which specific performance of contractenforceable – Except as otherwise provided in this Chapter, thespecific performance of any contract may, in the discretion ofthe court, be enforced - (a) when there exists no standard for ascertaining actualdamage caused by the non-performance of the act agreed to bedone; or (b) when the act agreed to be done is such that compensationin money for its non-performance would not afford adequaterelief. Explanation - Unless and until the contrary is proved, the courtshall presume - (i) that the breach of a contract to transfer immovable propertycannot be adequately relieved by compensation in money; and (ii) xxx xxx xxx xxxSection 16 – Personal bars to relief – Specific performance of acontract cannot be enforced in favour of a person - 8 of 11 (( 9 ))SA-382-2023-final(a) xxx xxx xxx xxx xxx (b) xxx xxx xxx xxx xxx (c) who fails to aver and prove that he has performed or hasalways been ready and willing to perform the essential terms ofthe contract which are to be performed by him, other thanterms the performance of which has been prevented or waivedby the defendant. Explanation. —For the purposes of clause (c), — (i) where a contract involves the payment of money, it is notessential for the plaintiff to actually tender to the defendant orto deposit in court any money except when so directed by thecourt; (ii) the plaintiff must aver performance of, or readiness andwillingness to perform, the contract according to its trueconstruction. Section 20 - Discretion as to decreeing specific performance.—(1) The jurisdiction to decree specific performance isdiscretionary, and the court is not bound to grant such reliefmerely because it is lawful to do so; but the discretion of thecourt is not arbitrary but sound and reasonable, guided byjudicial principles and capable of correction by a court ofappeal. (2) The following are cases in which the court may properlyexercise discretion not to decree specific performance:— (a) where the terms of the contract or the conduct of theparties at the time of entering into the contract or theother circumstances under which the contract wasentered into are such that the contract, though notvoidable, gives the plaintiff an unfair advantage over thedefendant; or (b) where the performance of the contract would involvesome hardship on the defendant which he did not foresee,whereas its non-performance would involve no suchhardship on the plaintiff; or (c) where the defendant entered into the contract undercircumstances which though not rendering the contract 9 of 11 (( 10 ))SA-382-2023-finalvoidable, makes it inequitable to enforce specificperformance. Explanation 1. Mere inadequacy of consideration,or the mere fact that the contract is onerous to thedefendant or improvident in its nature, shall not bedeemed to constitute an unfair advantage withinthe meaning of clause (a) or hardship within themeaning of clause (b). Explanation 2. The question whether the performance of acontract would involve hardship on the defendant within themeaning of clause (b) shall, except in cases where the hardshiphas resulted from any act of the plaintiff subsequent to thecontract, be determined with reference to the circumstancesexisting at the time of the contract.(3) The court may properly exercise discretion to decreespecific performance in any case where the plaintiff has donesubstantial acts or suffered losses in consequence of a contractcapable of specific performance.(4) The court shall not refuse to any party specific performance of a contract merely on the ground that the contract is not enforceable at the instance of the party”. 18.In case of P. Daivasigamani (supra), the Hon’bleSupreme Court considered the expression readiness and willingnessused in Section 16(c) of the Specific Relief Act and held that theCourt can exercise discretionary jurisdiction for granting decree ofspecific performance. But, the said discretionary jurisdiction cannotbe exercised arbitrarily.19.In the case in hand, both the Courts below recordedconcurrent findings that, on 27.02.2009, the defendant entered into 10 of 11 (( 11 ))SA-382-2023-finalan agreement to sale in respect of suit plots on consideration ofRs.8,00,000/-, out of which earnest money of Rs.3,51,000/- acceptedby the defendant and had agreed to execute sale-deed on or before30.06.2010 as per written agreement to sale Exh.24. The plaintiffproved said transaction, but the defendant failed to execute sale-deed. Therefore, findings recorded by the learned 3rd Joint Civil JudgeSr. Dn., Latur and which was affirmed by the learned District Judge -2 are based upon the oral, documentary evidence as well asprovisions of law and no perversity is found in the same. Therefore, Ido not find any substantial question of law is involved in the presentappeal. Accordingly, the present Second Appeal is hereby dismissed.20.Parties to bear their own cost. 21.In view of dismissal of the second appeal, pending civilapplication No.8831 of 2023 is disposed of. [ Y. G. KHOBRAGADE, J. ]SMS 11 of 11