The High Court
Case Details
- 1 - NC: 2025:KHC:14739 RSA No. 899 of 2016 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 7TH DAY OF APRIL, 2025 BEFORE THE HON'BLE MR JUSTICE ASHOK S.KINAGI REGULAR SECOND APPEAL NO. 899 OF 2016 (SP) BETWEEN: H V GANGADHRAPPA, S/O LATE VENKATAPA, AGED ABOUT 56 YEARS, OCC: GOVERNMENT SERVANT AND AGRICULTURIST R/O BHAKTANAKATTE DAKALE, HUTCHAHAHATTI, SHIVANI HOBLI, TARAKERE TALUK, CHIKKAMAGALURU DISTRICT - 577249. (BY SRI PRAVEEN KUMAR RAIKOTE, ADVOCATE) AND: 1. S PARAMESHWARAPPA, S/O LATE S SIDDAPPA @ SHEDDAPPA, AGED ABOUT 67 YEARS, AGRICULTURIST. 2. S P PRASHANTHA, S/O S PARAMESHWARAPPA, AGED ABOUT 39 YEARS 3. S P SURENDRAMURTHY, S/O S PARAMESHWARAPPA, AGED ABOUT 37 YEARS, …APPELLANT ALL ARE PERMANENT R/O SHIVANI VILLAGE AND HOBLI (NOW KASABA HOBLI), TARIKERE TALUK, CHIKAMAGALURU DISTRICT - 577249. …RESPONDENTS (BY SRI B KRISHNA GOWDA, ADVOCATE FOR R1 V/O/DT 13.03.2023 R2 & R3 IS H/S BY WAY OF PAPER PUBLICATION) Digitally signed by SUNITHA K S Location: HIGH COURT OF KARNATAKA - 2 - NC: 2025:KHC:14739 RSA No. 899 of 2016 THIS RSA IS FILED UNDER SEC.100 OF CPC., AGAINST THE JUDGMENT AND DECREE DATED 19.02.2016 PASSED IN RA.NO.133/2013 ON THE FILE OF THE II ADDL. DISTRICT JUDGE, CHIKKAMAGALURU, PARTLY ALLOWING THE APPEAL JUDGMENT AND DECREE AND SETTING ASIDE THE DATED30.09.2013 PASSED IN OS.NO.36/2011 ON THE FILE OF THE SENIOR CIVIL JUDGE AND PRL. JMFC., TARIKERE. THIS APPEAL, COMING ON FOR HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE ASHOK S.KINAGI ORAL JUDGMENT This Regular Second Appeal is filed by the appellant challenging the judgment and decree dated 19.02.2016 passed in RA No.133/2013 by the learned II Additional District Judge, Chikkamagaluru. 2. For convenience, the parties are referred to based on as per their ranking before the Trial Court. The appellant
Legal Reasoning
was the plaintiff, and the respondents were the defendants. 3. Brief facts leading rise to the filing of this appeal are as follows: The plaintiff filed a suit against the defendants for specific performance of a contract. It is the case of the plaintiff that defendant No.1 is an agriculturist, and defendants No.2 and 3 - 3 - NC: 2025:KHC:14739 RSA No. 899 of 2016 are working in Bengaluru. The defendants have entered into a sale agreement regarding the suit schedule properties for a consideration of Rs.5,50,000/- on 03.11.2008. The plaintiff paid Rs.5,25,000/- on the date of execution of the sale agreement as an advance sale consideration amount. The plaintiff agreed to pay the remaining sale consideration amount of Rs.25,000/- at the time of registering the document. The defendants have agreed to execute a registered sale deed within three years. The plaintiff has been ready and willing to perform his part of the contract under the agreement. The plaintiff requested the defendants to receive the balance sale consideration amount, and execute a registered sale deed. The defendants have not come forward to receive the balance sale consideration amount, and execute a registered sale deed. The plaintiff has been fed up with the delayed attitude of the defendants, and issued a legal notice, which was duly served on the defendants. Defendants replied to the legal notice by giving untenable reasons, and failed to execute a registered sale deed. Hence, a cause of action arose for the plaintiff to file a suit for specific performance of a contract. Accordingly, prays to decree the suit. - 4 - NC: 2025:KHC:14739 RSA No. 899 of 2016 4. Defendant No.1 filed a written statement contending that the transaction between the plaintiff and the defendants is a loan transaction and not a sale transaction. It is contended that the defendants have borrowed a sum of Rs.2,50,000/- from the plaintiff with interest at the rate of 2% and, as a security for the repayment of the said loan amount, executed alleged sale agreement, and it was agreed that the amount to be repaid. The plaintiff got registered a document for Rs.5,25,000/- including interest @ 3% per month. It is contended that the value of the suit properties as per the market value is more than 50,00,000/-. It is contended that the defendants has paid regular monthly interest of the plaintiff. The defendants have denied the entire sale averments made in the plaint, and accordingly, prays to dismiss the suit. 5. The Trial Court, based on the pleadings of the parties, framed the following issues: "(1) Whether the plaintiff proves that on 03.11.2008 defendant No.1 to 3 have entered into an registered agreement of sale with the plaintiff agreeing to sell the suit schedule properties for a sale consideration of Rs.5,50,000/- and received an advance - 5 - NC: 2025:KHC:14739 RSA No. 899 of 2016 amount of Rs.5,25,000/- agreeing to execute the required sale deed in terms of agreement of sale? (2) Whether plaintiff proves his readiness and willingness to perform his part of the contract? (3) Whether the defendants prove that the alleged agreement of sale dated 03.11.2008 was nominal document executed by way of security for repayment of a loan amount of Rs.2,50,000/- borrowed by them from the plaintiff as alleged by them? (4) Whether the plaintiff is entitled for the relief of permanent injunction sought for? (5) Whether the plaintiff is entitled for the relief of specific performance of contract sought for or in the alternative plaintiff is entitled for refund of the sale consideration amount together with interest as sought for? (6) What decree or order?" 6. The plaintiff, to prove his case, examined himself as P.W.1, examined 2 witnesses PW.2 and PW.3, and marked 7 documents as Exs.P1 to P7. On the other hand, defendant No.1 - 6 - NC: 2025:KHC:14739 RSA No. 899 of 2016 examined himself as DW-1, and marked 9 documents as Exs.D1 to D9. 7. The Trial Court, after recording the evidence, hearing on both sides, and on assessing the verbal, and documentary evidence answered issues No.1, 2, 4 and 5 in the affirmative, issue No.3 in the negative and issue No.6 as per the final order. 8. The suit of the plaintiff was decreed against defendants No.1 to 3 with costs, vide judgment dated 30.09.2013. The Trial Court directed defendants No.1 to 3 to a execute registered sale deed in favour of the plaintiff in terms of the registered agreement of sale dated 03.11.2008 by receiving a balance sale consideration amount of Rs.25,000/- within a period of 2 months from the date of the said order. The defendants were restrained by an order of permanent injunction from alienating the suit schedule properties in favour of third person or from creating any charge over the suit schedule properties. 9. Defendant No.1 aggrieved by the judgment and decree passed in O.S.No.36/2011, preferred an appeal in RA - 7 - NC: 2025:KHC:14739 RSA No. 899 of 2016 No.133/2013 on the file of II Additional District Judge, Chikkamagaluru. The Appellate Court, after hearing the learned counsel for the parties, framed the following points for consideration: 1) Whether the appellant/defendant No.1 proves that his two daughters having right over the suit schedule property, they are not entered into an agreement with the plaintiff/ 1st respondent, decree for specific performance cannot be granted, he is ready and willing to pay consideration amount of Rs.5,25,000/- along with interest? 2) Whether the 1st respondent/plaintiff proves that he is entitled to adduce additional evidence at this stage under Order XLI Rule 27 of C.P.C? 3) Whether the appellant further proves that the judgment and decree of the trial Court is perverse, opposed to law, evidence on record and liable to be set aside and modified? 4) What order? - 8 - NC: 2025:KHC:14739 RSA No. 899 of 2016 10. The First Appellate Court, on reassessing the verbal oral and documentary evidence, answered points No.1 and 3 in the affirmative and point No.2 in the negative, and point No.4 as per the final order. The appeal was partly allowed, vide judgment dated 19.02.2016. The judgment and decree passed in O.S.No.36/2011 dated 30.09.2013 on the file of Senior Civil Judge, Tarikere was set-aside, and the suit of the plaintiff was decreed of an alternative relief of recovery of Rs.5,25,000/- along with interest @ 12% per annum from the date of agreement till the date of realisation. The plaintiff, aggrieved by the judgment and decree passed in R.A.No.133/2013, filed this Regular Second Appeal. 11. Heard the arguments of the learned counsel appearing for the plaintiff and defendants. 12. Learned counsel appearing for the plaintiff submits that the First Appellate Court has not assigned any reasons for setting-aside the decree for the specific performance of a contract. He submits that the defendants have not taken any defence in the written statement regarding the daughters of defendant No.1 also have the right over the suit schedule - 9 - NC: 2025:KHC:14739 RSA No. 899 of 2016 properties. He submits that the findings recorded by the First Appellate Court in paragraph No.28 are without pleading. He further submits that the First Appellate Court has not correctly framed the points for consideration, and has not reappreciated the entire evidence on record. He submits that the First Appellate Court, being the final-fact finding Court, the First Appellate Court is required to answer each issue framed by the Trial Court. He submits that the judgment passed by the First Appellate Court does not comply with Order XLI Rule 31 of the Code of Civil Procedure (for short 'CPC'). He submits that the matter requires reconsideration by the First Appellate Court. Hence, these grounds, he prays to set-aside the judgment and decree passed in RA No.133/2013, and remit the matter to the First Appellate Court. 13. Per contra, learned counsel appearing for the defendants supported the impugned judgment, and accordingly, prays for dismissal of the appeal. 14. This Court vide order dated 20.07.2016 has framed the following substantial questions of law: - 10 - NC: 2025:KHC:14739 RSA No. 899 of 2016 (a) Whether the lower appellate Court is justified in reversing the judgment and decree of the trial Court directing defendants to refund the amount of Rs.5,25,000/- mainly on the ground that the daughters of the first defendant are also having right over the suit schedule property in the absence of any specific defence in the written statement, any issue framed nor adduced any evidence? (b) Whether the lower appellate Court is justified in reversing the judgment and decree of the trial Court, when the plaintiff proved his agreement and he was willing to perform his part of contract as contemplated under provisions of section 16(c) of Specific Relief Act? (c) Whether the lower appellate Court is justified in reversing the judgment and decree of the trial Court without following the mandatory procedure as contemplated under the provisions of Order 41 Rule 31 of CPC? (d) Whether the lower appellate Court is justified in reversing the judgment and decree of the trial Court in the facts and circumstances of the present case?" - 11 - NC: 2025:KHC:14739 RSA No. 899 of 2016 15. This Court is taking substantial question No.3 for discussion. If substantial question No.3 is answered in a negative, the other substantial questions will not arise. The plaintiff filed a suit for specific performance of a contract alleging that defendant No.1 executed a sale agreement dated 03.11.2008 agreeing to sell the suit schedule properties in favour of the plaintiff for consideration of Rs.5,50,000/-, and the plaintiff paid a sum of Rs.5,25,000/- towards advance sale consideration amount, and it was agreed that the balance sale consideration amount to be paid within three years from the date of execution of sale agreement. The plaintiff requested the defendants to receive the balance sale consideration amount, and execute a registered sale deed. The defendants went on postponing the same on one pretext or the other. The plaintiff issued a legal notice to establish that the plaintiff was always ready and willing to perform his part of the contract. The defendants replied to the said legal notice. The plaintiff examined himself as P.W.1. He reiterated the plaint averments in the examination-in-chief, and to prove that defendant No.1 executed a sale agreement in favour of the plaintiff, produced an original registered sale agreement - 12 - NC: 2025:KHC:14739 RSA No. 899 of 2016 marked as Ex.P1. Ex.P2 is the copy of the legal notice which discloses that the plaintiff called upon the defendants to receive the balance sale consideration amount, and execute the registered sale deed. Ex.P3 is the copy of the reply notice, which discloses that the defendants had denied the execution of the sale agreement, and contended that the transaction between the plaintiff and defendant No.1 is a loan transaction. Ex.P4 to P6 are the certified copies of the RTC extracts. Ex.P7 is the certified copy of the registered sale deed. 16. Further, the plaintiff also examined two witnesses as PW.2 and PW.3. PW.2, who is attesting witness to Ex.P1, has deposed that defendant No.1 agreed to sell the suit schedule properties for consideration of Rs.5,50,000/-, and plaintiff paid Rs.5,25,000/- as advance sale consideration amount, and further agreed to pay the balance consideration amount at the time of execution of registered sale deed within 3 years of the registration of sale agreement. Further, PW.1 during the cross- examination, admits that he is an employee of the Railway Department and also admits that before purchasing any property, prior permission from the Railway Department was - 13 - NC: 2025:KHC:14739 RSA No. 899 of 2016 essential. Further, the plaintiff also examined one witness as PW.3, who deposed in the same line of PW.2. 17. On the other hand, defendant No.1 examined himself as DW.1. He reiterated the written statement averments in the examination-in-chief, and to prove the defence, defendant No.1 produced Ex.D1-certified copy of the registered sale deed dated 29.04.2008. Ex.D2 is the certified copy of the registered sale deed dated 04.03.2006. Ex.D3 is the RTC extract. Ex.D4 to D6 are the Mutation Register extracts. Ex.D7 to D9 are the Valuation Certificates. During the course of cross-examination, it was suggested to DW.1 that, he has accepted the sale consideration amount. The said suggestion was denied by DW.1. 18. The Trial, Court after recording the evidence, held that the plaintiff has proved that defendants No.1 to 3 have entered into a registered sale agreement with the plaintiff agreeing to sell the suit schedule properties for a consideration of Rs.5,50,000/- and accordingly, plaintiff paid a sum of Rs.5,25,000/- towards advance sale consideration amount, and it was agreed that the balance amount is to be paid at the time - 14 - NC: 2025:KHC:14739 RSA No. 899 of 2016 of execution of registered sale deed. Further, the plaintiff proved that he was ready and willing to perform his part of contract. The defendants have failed to establish that the registered sale agreement dated 03.11.2008 was a nominal document executed by way of security for repayment of the loan amount of Rs.2,50,000/- borrowed by them, from the plaintiff. Further, it is held that the plaintiff is entitled to a relief of permanent injunction, and the plaintiff is also entitled to a relief of specific performance of a contract. Defendant No.1, aggrieved by the judgment and decree passed in O.S.No.36/2011, preferred an appeal in RA No.133/2013. 19. Admittedly, the suit is one for the specific performance of a contract. The First Appellate Court has not framed any points for consideration regarding the execution of the sale agreement, receiving of advance sale consideration amount, and readiness and willingness. 20. From the perusal of the judgment passed by the First Appellate Court, the First Appellate Court has not correctly framed points for consideration nor considered the materials placed on record. The First Appellate Court has just relied upon - 15 - NC: 2025:KHC:14739 RSA No. 899 of 2016 the judgment of the Bombay High Court in the case of Jethalal Nanshah Modi vs. Bachu and another1 and further recorded a finding in paragraph No.28 that, the daughters of defendant No.1 are necessary parties to execute the instrument as the suit properties are joint family properties of defendants and daughters. The findings recorded by the First Appellate Court in paragraph No.28 are without pleadings. Further, the First Appellate Court has not recorded a finding or whether the plaintiff was/is always ready and willing to perform his part of the contract. So without going into the merits of the case, the First Appellate Court reversed the judgment passed by the Trial Court. 21. The First Appellate Court being the final fact finding Court, is required to frame the points for consideration. While dealing with the first appeal, the First Appellate Court shall frame the points for determination, the decision thereon, the reasons for the decision, and whether the decree appealed from is reversed or varied from the relief to which appellant is entitled. Admittedly, in the instant case, the First Appellate Court has not correctly framed the points for consideration, and 1 AIR 1945 Bom 481 - 16 - NC: 2025:KHC:14739 RSA No. 899 of 2016 has not adequately re-appreciated the entire evidence on record, and the reasonings assigned by the First Appellate Court are unwarranted and without pleading. The instant matter requires reconsideration by the First Appellate Court. The judgment and decree passed by the First Appellate Court does not comply with Order XLI Rule 31 of the CPC. 22. In view of the above discussions, I answer substantial question No.3 in the negative and this Court is of the opinion that the matter requires reconsideration by the First Appellate Court. In view of the same, substantial questions of Law No.1, 2 and 4 do not arise for consideration. 23. Accordingly, I proceed to pass the following:
Decision
ORDER (a) The Appeal is allowed. (b) The judgment and decree dated 19.02.2016 passed in RA No.133/2013 by the learned II Additional District Judge, Chikkamagalur is set- aside. (c) RA No.133/2013 is restored to its original file. The First Appellate Court is directed to frame proper points for consideration and pass the - 17 - NC: 2025:KHC:14739 RSA No. 899 of 2016 judgment in compliance with Order XLI Rule 31 of the Code of Civil Procedure, in accordance with law. (d) The parties are directed to appear before the First Appellate Court on 12.07.2025 without awaiting any notice. (e) The office is directed to transmit the records to the First Appellate Court. (f) All the contentions of the parties are kept open. In view of the disposal of appeal, I.A.No.1/2016 does not survive for consideration. Accordingly, the same is disposed of. Sd/- (ASHOK S.KINAGI) JUDGE GVP List No.: 1 Sl No.: 5