1.Whether the courts below are right in decreeing the suit for specific performance basing on the pleadings of the plaintiff about his financial capacity and the readiness and willingness expressed by him in the plaint without there being any evidence both oral and documentary and the 1st defendant specifically denied Ex.A1 agreement of sale?
2.Whether the courts below are right in decreeing the suit without giving any specific finding with regard to the plea taken by the 2nd defendant about the bona fide purchase made by him for value without notice ? 2023:APHC:47562
suit for specific performance of sale agreement dated 22.03.2011 - The plaintiff paid Rs.5,00,000/- towards advance to the 1st defendant on condition that the balance sale consideration should be paid on or before 9.5.2011, and in case of default, the plaintiff has to pay interest @ 2% p.m. Further, in case of default by 1st defendant, she has to pay interest at the same rate on the advance amount and the interest shall be deducted out of the balance consideration. - The plaintiff issued registered notice 20.4.2011 demanding the 1st defendant to receive the balance consideration of Rs.2,53,778/- and execute registered sale deed on or before 9.5.2011. During pendency of the said suit, the 1st defendant executed a registered sale deed dated 5.5.2011 in favour of the 2nd defendant in order to defeat the rights of the plaintiff. The sale deed will not bind the plaintiff. The 2nd defendant also executed registered sale deed. Hence the plaintiff filed the suit before the trial Court.-
held that
20. It is an admitted fact that the appellant herein is a bona fide purchaser for value without notice under Ex.B4. Further, when the 1st defendant/2nd respondent herein requested the plaintiff/1st respondent herein to send the document for giving a detailed reply, the plaintiff/1st respondent without sending the document filed the suit for specific performance.
This Court further observed that, according to plaintiff/1st respondent, he paid Rs.5,0,000/- substantial portion, but there is no explanation as to why he did not pay the remaining balance on the same date and obtained the sale deed. The 1st defendant/2nd respondent herein totally denied the execution of Ex.A1 agreement of sale and her signatures on Ex.A1. Moreover, without comparing the signatures on Ex.A1 with that of admitted signatures of Ex.B1 decreed the suit.
where a contract involves the payment of money, it is not essential for the plaintiff to actually tender to the defendant or to deposit in Court any money except when so directed by the Court. In the present case, the balance of sale consideration has to be paid by the plaintiff/1st respondent on or before 9.5.2011, whereas, the Ex.A2 notice was sent on 20.04.2011 i.e., just 19 days prior to expiry of the date fixed for paying the balance of sale consideration. Moreover, the suit was filed on 03.05.2011 even before the date fixed for payment of balance sale consideration. Further, according to plaintiff/1st respondent that he paid Rs.5,00,000/- substantial portion, but there is no explanation as to why he did not pay the remaining balance on the same date.
23. In view of the foregoing discussion and considering the submissions made by both the learned counsels, whatever the substantial questions of law raised by the appellant are satisfied and hence this Court is of the view that, the judgments and decrees passed by the Courts below are not proper and liable to be set aside.
HIGH COURT OF ANDHRA PRADESH :: AMARAVATI
+SECOND APPEAL No.207 of 2023
Between:
# Devatha Venkata Satya Naga Sridhar Subbarao
S/o. Venkataratnam.
… Appellant
And
$ Kodi Venkata Subbarao, S/o Satyanarayana Murthy
Busienss, D.No.33-2-1, 17th Ward, Atchugatlapalem
Palakol and 7 others.
…. Respondents
JUDGMENT PRONOUNCED ON 18.08.2023
THE HON’BLE DR.JUSTICE K. MANMADHA RAO
1. Whether Reporters of Local newspapers
may be allowed to see the Judgments? - Yes -
2. Whether the copies of judgment may be marked
to Law Reporters/Journals - Yes -
3. Whether Their Ladyship/Lordship wish to see
the fair copy of the Judgment? - Yes -
___________________________________
DR.JUSTICE K. MANMADHA RAO
2
* THE HON’BLE DR.JUSTICE K. MANMADHA RAO
+SECOND APPEAL No.207 of 2023
% 18.08.2023
Between:
# Devatha Venkata Satya Naga Sridhar Subbarao
S/o. Venkataratnam.
… Appellant
And
$ Kodi Venkata Subbarao, S/o Satyanarayana Murthy
Busienss, D.No.33-2-1, 17th Ward, Atchugatlapalem
Palakol and 7 others.
…. Respondents
! Counsel for the Petitioner : Sri P. Rajasekhar,
Sri E.V.V.S Ravi Kumar
Counsel for Respondent: Sri M. Lakshmi Narayana
<Gist :
>Head Note:
? Cases referred:
1. 2006(4) Supreme 131
2. Civil Appeal Nos.2843-2844 of 2010, dated 27.8.2020
3. Appeal (Civil) No.418 of 2001
4. Appeal (Civil) No.6764 of 2001
3
HON’BLE DR. JUSTICE K. MANMADHA RAO
SECOND APPEAL No.207 of 2023
JUDGMENT:
The present Second Appeal is preferred by the
appellant aggrieved by the Decree and Judgment dated
31.10.2022 passed in A.S.No.40 of 2015 on the file of X
Additional District Judge, Narsapur, confirming the decree
and judgment dated 06.04.2018 passed in O.S No.125 of
2011 on the file of Senior Civil Judge, Narsapuram.
2. The appellant herein is the 2nd defendant, the 1st
respondent is the plaintiff and the respondents No.2 to 8 are
the legal heirs of the 1st defendant in the suit. Originally the
suit in O.S No.125 of 2011 was filed before the Senior Civil
Judge, Narsapuram (for short “the trial Court) by the 1st
respondent/plaintiff for specific performance of sale
agreement dated 22.03.2011.
3. For convenience the parties are hereinafter referred
to as arrayed before the Additional District Judge,
Narsapuram (for short “the first appellate Court”) in
A.S.No.40 of 2015.
4
4. The 1st defendant is the absolute owner of 94.2
square yards of site in the 9th ward (presently 16th ward),
Shahakarpeta, Palakol i.e., plaint schedule property. She
purchased the same under a registered sale deed dated
18.6.1990 and she offered to sell it to the plaintiff for
Rs.7,53,778/-. The plaintiff paid Rs.5,00,000/- towards
advance to the 1st defendant on condition that the balance
sale consideration should be paid on or before 9.5.2011, and
in case of default, the plaintiff has to pay interest @ 2% p.m.
Further, in case of default by 1st defendant, she has to pay
interest at the same rate on the advance amount and the
interest shall be deducted out of the balance consideration.
The plaintiff issued registered notice 20.4.2011 demanding
the 1st defendant to receive the balance consideration of
Rs.2,53,778/- and execute registered sale deed on or before
9.5.2011. During pendency of the said suit, the 1st
defendant executed a registered sale deed dated 5.5.2011 in
favour of the 2nd defendant in order to defeat the rights of
the plaintiff. The sale deed will not bind the plaintiff. The
2nd defendant also executed registered sale deed. Hence the
plaintiff filed the suit before the trial Court.
5
5. The 1st defendant filed written statement and
denied all the averments made in the plaint. It is stated
that there is long standing business rivalry between the
plaintiff and the husband of 1st defendant and agreement
might have been, therefore fabricated by forging the
signatures of 1st defendant in collusion with his associates
and followers. It is also stated that the 1st defendant issued
a reply notice dated 28.4.2011 and the same was received
by the plaintiff. Further, the 1st defendant reserves right to
take criminal action against the plaintiff under Sections 468
and 420 IPC. Hence, prayed to dismiss the suit.
6. The 2nd defendant also filed written statement and
denied the plaint averments and alleged what 1st defendant
did in her written statement. It is stated that he is a bona
fide purchaser for consideration. The suit is bad for misjoinder of parties. Hence, prayed to dismiss the suit.
7. On the impleadment of 2nd defendant, 1st defendant
filed additional written statement pleading that 2nd
defendant is a bona fide purchaser for valuable
consideration.
6
8. Basing on the above pleadings, the trial Court
framed the following issues:
1. Whether the agreement of sale dated 22.03.2011 is true, valid
and binding on the defendant?
2. Whether the plaintiff is entitled to the suit claim as prayed
for?
3. To what relief?
9. Thereafter, an additional issue was also framed after the
impleadment of 2nd defendant:
1. Whether the 2nd defendant is a bona fide purchaser for
consideration?
10. During course of trial, on behalf of the plaintiff, he
himself was examined as PW.1, the first attestor of the
agreement was examined as PW.2; PW.3 was also examined
but did not appear for cross examination and Exs.A1 to A4
were marked. On behalf of the defendants, DWs.1 to 4 were
examined and Exs.B1 to B5 were marked.
11. After considering the oral and documentary
evidence, the trial Court decreed the suit and directed the
plaintiff to deposit an amount of Rs.2,53,778/- on or before
6.6.2018, and on such deposit, the 1st and 2nd defendants
are directed to execute a registered sale deed in favour of the
plaintiff, within a period of two(2) months from the date of
7
such deposit. The trial Court further held that the 1st
defendant is entitled to receive the above said amount on
execution of registered sale deed and the defendants do pay
to the plaintiff a sum of Rs.85,848/- towards costs of the
suit. Aggrieved by the same, the 2nd defendant preferred an
appeal in A.S No.40 of 2015 before the first appellate Court.
After hearing the both sides, the first appellate Court has
framed points for consideration as under:
i) Whether the 2nd defendant is a bona fide purchaser for
consideration or not?
ii) Whether the findings under the impugned judgment dated
06.04.2018 made by learned Senior Civil Judge,
Narasapur need to be interfered for getting the impugned
judgment and decree set aside?
iii) If so, to what relief?
12. Basing on the facts and circumstances of the case,
the first appellate Court has dismissed the Appeal suit
holding that it is inevitable to hold that the learned Senior
Civil Judge, Narasapur, after having considered overall
pleadings of both parties to the suit and evaluated both the
oral and documentary evidence let in on their behalf in
proper perspective, rightly decreed the suit and therefore
interference with the findings made by learned Trial Court is
8
absolutely unwarranted. Challenging the same, the present
second appeal came to be filed.
13. While both counsels prepared to argue the matter
finally, this Court also decided to dispose of the matter at
the admission stage with the consent of both the counsels.
Further, the appellant counsel has raised the following
substantial questions of law in the grounds appeal:
i) Whether the courts below are right in decreeing the
suit for specific performance basing on the pleadings of the
plaintiff about his financial capacity and the readiness and
willingness expressed by him in the plaint without there
being any evidence both oral and documentary and the 1st
defendant specifically denied Ex.A1 agreement of sale?
ii) Whether the courts below are right in decreeing the
suit without giving any specific finding with regard to the
plea taken by the 2nd defendant about the bona fide
purchase made by him for value without notice?
iii) Whether the alleged admissions of DW.1 pointed
out by the courts below would benefit the plaintiff without
their being any material showing his readiness and
willingness in the above matter?
14. Heard Sri P. Rajasekhar, learned counsel
representing Sri E.V.V.S. Ravi Kumar, learned counsel
appearing for the appellant and Sri M. Lakshmi Narayana,
learned counsel appearing for the respondent.
9
15. Learned counsel for the appellant mainly
contended that the Courts below erred in holding that the
1st defendant herein executed Ex.A1 agreement of sale and it
is true, valid and binding on the parties. The Courts below
should have seen that the appellant herein is a bona fide
purchaser for value without notice under Ex.B4 and also
should have seen that the case of the plaintiff is that the
balance of sale consideration has to be paid on or before
9.5.2011, whereas, the Ex.A2 notice was sent on 20.4.2011
i.e., just 19 days prior to expiry of the date fixed for paying
the balance of sale consideration. However, the suit is filed
on 03.05.2011 even before the date fixed for payment of
balance sale consideration. He further submits that the
Courts below should have seen that according to plaintiff
that he paid Rs.5,00,000/- substantial portion, there is no
explanation as to why he did not pay the remaining balance
on same date and obtained the sale deed and also should
have seen that the 1st defendant totally denied the execution
of Ex.A1 Agreement of sale and her signatures on Ex.A1.
Moreover without comparing the signature on Ex.A1 with
that of admitted signatures of Ex.B1, decreed the suit
10
erroneously. He further submits that the Courts below
failed to appreciate the contents of reply notice dated
20.04.2011 while decreeing the suit. He mainly contended
that the Courts below failed to give any finding with regard
to the bona fide purchase made by the appellant herein.
16. To support his contentions, learned counsel for
the appellant has relied upon a decision of Hon’ble Supreme
Court reported in Hero Vinoth (Minor) versus
Seshammal1, wherein the Hon’ble Apex Court held that :
“The principles relating to Section 100 CPC, relevant for this case,
may be summerised thus:-
(i) An inference of fact from the recitals or contents of a document is
a question of fact. But the legal effect of the terms of a document is
a question of law. Construction of a document involving the
application of any principle of law, is also a question of law.
Therefore, when there is misconstruction of a document or wrong
application of a principle of law in construing a document, it gives
rise to a question of law.
(ii) The High Court should be satisfied that the case involves a
substantial question of law, and not a mere question of law. A
question of law having a material bearing on the decision of the
case (that is, a question, answer to which affects the rights of
parties to the suit) will be a substantial question of law, if it is not
covered by any specific provisions of law or settled legal principle
emerging from binding precedents, and, involves a debatable legal
issue. A substantial question of law will also arise in a contrary
situation, where the legal position is clear, either on account of
express provisions of law or binding precedents, but the court
below has decided the matter, either ignoring or acting contrary to
such legal principle. In the second type of cases, the substantial
question of law arises not because the law is still debatable, but
1
2006 (4) Supreme 131
11
because the decision rendered on a material question, violates the
settled position of law.
(iii) The general rule is that High Court will not interfere with
concurrent findings of the Courts below. But it is not an absolute
rule. Some of the well recognized exceptions are where (i) the
courts below have ignored material evidence or acted on no
evidence;
(ii) the courts have drawn wrong inferences from proved facts by
applying the law erroneously; or (iii) the courts have wrongly cast
the burden of proof. When we refer to 'decision based on no
evidence', it not only refers to cases where there is a total dearth of
evidence, but also refers to any case, where the evidence, taken as
a whole, is not reasonably capable of supporting the finding.
17. On the other hand, learned counsel for the
respondents submits that though the 1st defendant issued
reply, the plaintiff falsely pleaded that no reply was issued.
The signatures of 1st defendant on the agreement are not the
same. He further submits that there is no proof that the
plaintiff’s readiness and willingness. Expressing readiness
and willingness is not sufficient without deposit of balance
consideration. The suit was filed to defeat 2nd defendant’s
sale deed. The plaintiff is a broker n real estate, well0versed in litigation, filed suits in Palakol, having criminal
cases against him. The suit is one of such cases the 2nd
defendant is a bona fide purchaser for consideration and
possession was handed over to 2nd defendant, 2nd defendant
is paying taxes, hence sale deed is genuine.
12
18. To support of his contentions, the learned counsel
for the respondents has relied upon a judgment reported in
(i) Nazir Mohamed versus J.Kamala and Ors.2, wherein the
Hon’ble Apex Court held that :
. To be a question of law “involved in the case”, there must
be first, a foundation for it laid in the pleadings, and the question
should emerge from the sustainable findings of fact, arrived at by
Courts of facts, and it must be necessary to decide that question of
law for a just and proper decision of the case.
(ii) In a case of M.M.S. Investments, Madurai and
Ors. V. V.Veerappan and Ors.3, wherein the Apex Court
held that:
“After the conveyance, the only question to be adjudicated
is whether the purchaser was a bona fide purchaser for value
without notice. In the present case the only issue that can be
adjudicated is whether the appellants were bona fide purchasers
for value without notice. The question whether the appellants were
ready and willing is really of no consequence.”
(iii) In a case of Guruswamy Nadar versus
P.Lakshmi Ammal(D) through LRs. & Ors.4, wherein the
Apex Court held that :
“..the only question which was argued was whether the
principle of lis pendens will be applicable or Section 19 of the
Specific Relief Act will have overriding effect to which we have
already answered. In the present case the principle of lis pndens
will be applicable as the second sale has taken place after the
2
Civil Appeal Nos.2843-2844 of 2010, dated 27.8.2020
3
Appeal (Civil) No.418 of 2001
4
Appeal (civil) No.6764 of 2001
13
filing of the suit. Therefore, the view taken by the Division Bench of
the High Court is correct…”
19. On a perusal of the material available on record
this Court observed that, as per the evidence of plaintiff, he
issued legal notice under Ex.A20 on 20.04.2011 and he did
not obtain the postal acknowledgment from the 1st
defendant. The 1st defendant issued reply dated 28.04.2011
under Ex.B2 and the same was received by the plaintiff on
02.05.2011. This Court further observed that there is no
date on Ex.B3 acknowledgment about the receipt of reply
notice by the plaintiff. This Court further observed that as
per Ex.B4 the consideration was mentioned in the sale deed
executed by 1st defendant for Rs.6,12,500/- whereas the
consideration mentioned in the agreement of sale under
Ex.A1 is Rs.7,53,778/-. This Court further observed that
as per Ex.A2 notice which was received by the 1st defendant
clearly reveals that the 1st defendant executed a sale
agreement for the consideration mentioned therein and
other terms and conditions of the agreement.
20. It is an admitted fact that the appellant herein is
a bona fide purchaser for value without notice under Ex.B4.
14
Further, when the 1st defendant/2nd respondent herein
requested the plaintiff/1st respondent herein to send the
document for giving a detailed reply, the plaintiff/1st
respondent without sending the document filed the suit for
specific performance. This Court further observed that,
according to plaintiff/1st respondent, he paid Rs.5,0,000/-
substantial portion, but there is no explanation as to why he
did not pay the remaining balance on the same date and
obtained the sale deed. The 1st defendant/2nd respondent
herein totally denied the execution of Ex.A1 agreement of
sale and her signatures on Ex.A1. Moreover, without
comparing the signatures on Ex.A1 with that of admitted
signatures of Ex.B1 decreed the suit.
21. It is pertinent to mention here that as per Section
16(c) of the Specific Relief Act, 1963 (for short “the Act”),
specific performance of a contract cannot be enforced, which
reads as under:
“16. Personal bars to relief : Specific performance of a
contract cannot be enforced in favour of a person –
(a)…
(b)….
(c). Who fails to aver and prove that he has performed or
has always been ready and willing to perform the essential terms
of the contract which are to be performed by him, other than
terms the performance of which has been prevented or waived by
the defendant.”
15
And as per Section 19 (b) and 20 of the Act, reads as
under:
19. Relief against parties and persons claiming under
them by subsequent title:- Except as otherwise provided by this
Chapter, specific performance of a contract may be enforced
against –
(a)….
(b) any other person claiming under him by a title arising
subsequently to the contract, except a transferee for value who
has paid his money in good faith and without notice of the
original contract;
……
20. Discretion as to decreeing specific performance :
(1) the jurisdiction to decree specific performance is
discretionary, and the Court is not bound to grant such relief
merely because it is lawful to do so; but the discretion of the
Court is not arbitrary but sound and reasonable, guided by
judicial principles and capable of correction by a court of appeal.”
22. On a perusal of above sections, it clearly
established that, where a contract involves the payment of
money, it is not essential for the plaintiff to actually tender
to the defendant or to deposit in Court any money except
when so directed by the Court. In the present case, the
balance of sale consideration has to be paid by the
plaintiff/1st respondent on or before 9.5.2011, whereas, the
Ex.A2 notice was sent on 20.04.2011 i.e., just 19 days prior
to expiry of the date fixed for paying the balance of sale
consideration. Moreover, the suit was filed on 03.05.2011
even before the date fixed for payment of balance sale
16
consideration. Further, according to plaintiff/1st respondent
that he paid Rs.5,00,000/- substantial portion, but there is
no explanation as to why he did not pay the remaining
balance on the same date.
23. In view of the foregoing discussion and
considering the submissions made by both the learned
counsels, whatever the substantial questions of law raised
by the appellant are satisfied and hence this Court is of the
view that, the judgments and decrees passed by the Courts
below are not proper and liable to be set aside.
24. Accordingly, the Second Appeal is allowed. The
impugned judgment and decree dated 31.10.2022 passed in
A.S.No.40 of 2015 on the file of the X Additional District
Judge, Narsapur, confirming the judgment and decree dated
06.04.2018 passed in O.S No.125 of 2011 on the file of the
Senior Civil Judge, Narsapur, are hereby set aside.
Consequently, the O.S.No.125 of 2011 on the file of the
Senior Civil Judge, Narsapur, stands dismissed. There shall
be no order as to costs.
As a sequel, all the pending miscellaneous
applications shall stand closed.
______________________________
DR. K. MANMADHA RAO, J.
Date : 18-08-2023
Note : L. R copy to be marked.
17
(b/o)Gvl
HON’BLE DR. JUSTICE K. MANMADHA RAO
SECOND APPEAL No.207 of 2023
Date : 18 .08.2023
Gvl
