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2005(2) Supreme 370
Supreme Court of India
(From Karnataka High Court)
Ashok Bhan & A.K. Mathur, JJ.
Devalsab (D) by Lrs. —Appellant
versus
Ibrahimsab F. Karajagi & Anr. —Respondents
Civil Appeal No. 5628 of 1999
Decided on 4-3-2005
Counsel for the Parties :
For the Appellant : Rajesh Mahale, S. Manjunath and R.C. Kohli, Advocates.
For the Respondents : K.R. Nagaraja and Ms. E.R. Sumathy, Advocates.
Held : In fact, so far as the questions of fact are concerned, all the three Courts are unanimous that the plaintiff entered into an agreement for purchase of the suit premises first in point of time, that the plaintiff had already issued advertisement in the press which was published in the daily newspaper that the suit property has been purchased by him. The Courts below have also held against Defendant No.2 that it cannot be said that Defendant No.2 was not aware of the transactions between the plaintiff and Defendant No.1. It has also been held that Defendant No.2 cannot be treated as a bona fide purchaser for value. But learned Single Judge of the High Court has invoked Section 20 of the Specific Relief Act, 1963 and held that it will be more harsh to Defendant No.2 as he has already paid the consideration and he is residing in the very premises for a very long time and the suit premises are in his possession, therefore, it would be more harsh to him than to the plaintiff-appellant herein. Therefore, instead of granting decree for specific performance of the agreement to sell against Defendant No.1, learned Single Judge of the High Court modified the decree and denied relief of specific performance of the agreement being discretionary remedy and directed the Defendant No.1 for refund of the purchase money for a sum of Rs. 15,500/- with future interest and costs and dismissed the suit of the plaintiff for possession of the suit schedule property. (Para 6)
But looking to the facts of the present case we are of opinion that it will be unfair and inequitable not to grant a decree for specific relief in favour of the plaintiff-appellant herein because he is a bona fide purchaser and he has done everything which is possible, that he has purchased the stamp paper and was ready and willing to perform his part of the contract, that he went along with Defendant No.1 to the Sub-Registrar’s Office for registration but some how Defendant No.1 sneaked away from that place as he had already entered into another agreement to sell the present premises, so much so that a sham suit was got filed by Defendant No.2 against Defendant No.1 and on the same day a compromise decree was obtained. These facts go to show that there is not much equity left in favour of Defendant No.2 as it appears that the suit by Defendant No.2 was a pre-arranged affair with connivance with Defendant No.1. Otherwise the suit would not have been filed on the same day and a compromise decree would not have been obtained the very same day. This shows that there was a pre-conceived agreement between Defendant Nos. 1 & 2 in order to cheat the plaintiff-appellant herein. Therefore, we are of opinion that the discretionary power exercised by learned Single Judge of the High Court was not correct. In fact, it appears that Defendant No.2 has purchased the litigation and therefore, there is no equity in his favour. (Para 7)
Judgment
A.K. Mathur, J.—This appeal is directed against an order passed by learned Single Judge of the High Court of Karnataka at Bangalore in Regular Second Appeal No. 68 of 1994 whereby learned Single Judge by his order dated October, 17, 1997 has allowed the second appeal of the defendant No.1 and set aside the order passed by the trial court and the first appellate court and dismissed the suit filed by the plaintiff for specific performance but decreed the suit of the plaintiff for the alternative relief for refund of the purchase money of Rs. 15,000/- with future interest and the court costs from Defendant No.1 Aggrieved against this order the Special Leave Petition was filed by the plaintiff.
2. Brief facts for disposal of this appeal are that the Defendant No.1 was the owner of the suit property which is a house bearing HDMC No. 715 comprised in CTS No. 1529/16-C situated at Hubli. Defendant No.1 agreed to sell the suit property to the plaintiff on March 13, 1981 for a sum of Rs. 15,500/- and received an advance of Rs. 2,000/- and executed an agreement for sale agreeing to execute the sale deed within two months after obtaining necessary permission. The plaintiff assisted the Defendant No.1 in obtaining necessary permission from the competent authority. But Defendant No.1 after getting necessary permission for sale failed to execute the sale deed accepting the balance consideration money of Rs. 13,500/- from the plaintiff. Defendant No.1 took the plaintiff to the Sub-Registrar’s Office on February 23, 1982 and persuaded him to purchase the stamp paper but Defendant No.1 escaped from the Office of the Sub-Registrar when the sale deed was about to be registered. The plaintiff was ready and willing to perform his part of the contract according to the terms and conditions of the agreement of sale on March 13, 1981. In spite of requests by the plaintiff, Defendant No.1 did not execute the registered sale deed receiving the balance amount. Hence, the suit was filed for specific performance of the agreement by the plaintiff and in the alternative the plaintiff also prayed if the court were to come to the conclusion that specific performance cannot be granted then a decree for refund of the earnest money including the cost of registration and damages to the plaintiff should be awarded. The plaint was subsequently amended on account of the new facts coming to the light that Defendant No.1 has executed another agreement for sale in favour of Defendant No.2 on March 8, 1982. The plaintiff got a news item published in Vishwavani daily on March 24, 1982 about the earlier transactions between himself and Defendant No.1 with respect to the suit property. But defendant Nos. 1 & 2 with an intention to defeat and defraud the plaintiff filed another collusive suit being O.S.No. 101 of 1983 before the Munsif, Hubli and obtained a compromise decree. By virtue of the said compromise decree Defendant No.2 obtained the sale deed from Defendant No.1 in respect of the suit property. Therefore, the plaintiff amended the plaint and impleaded Defendant No.2 and prayed that the collusive decree obtained by Defendant Nos. 1 & 2 is illegal, void and not binding on the plaintiff. It was further prayed that Defendant No.2 was also bound to execute the sale deed along with Defendant No.1 and hand over possession of the suit property.
3. A written statement was filed by Defendant No.1. He denied the allegation in the plaint but subsequently Defendant No.1 did not contest the suit. Defendant No.2 i.e. the subsequent purchaser was impleaded as a party by amendment of the plaint carried on November 21, 1986 and assisted the suit by filing the written statement. He denied the allegation about the agreement of sale executed in favour of the plaintiff. It was also pointed out that he was a tenant in the suit premised under Defendant No.1 since long time. It was contended that Defendant No.1 agreed to sell the suit property and entered into an agreement for sale o
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