IMPORTANT POINT
Agreement to sell – Onus is on subsequent purchaser to prove that he purchased property in good faith and also bona fide purchaser for value.

ORDER

1. Leave granted.

2. This appeal arises from the judgment and order passed by the High Court of Punjab and Haryana at Chandigarh dated 22-1-2019 in Regular Second Appeal No.1145/1992 by which the High Court allowed the Second Appeal filed by the original plaintiff and thereby decreed the suit of the plaintiff granting specific performance of oral agreement of sale of the year 1986.

3. The facts giving rise to this appeal may be summarized as under.

4. The Respondent No.1 – herein (original plaintiff) instituted suit for specific performance of contract based on an unregistered sale deed dated 12-02-1986 with respect to the suit property.

5. It appears from the materials on record that the original defendant No.1, i.e., the owner of the suit property after entering into an agreement with the plaintiff transferred the suit property in favour of the defendants Nos.2 and 3 respectively i.e., the appellants before us by way of a sale deed dated 29-8-1986.

6. In such circumstances, the Respondent No.1 - herein (original plaintiff) had to institute the Civil Suit No.27/1987 praying for specific performance.

7. The Trial Court allowed the suit in favour of the plaintiff. The subsequent purchasers, i.e., the petitioners – herein (original defendant Nos.2 & 3) preferred first appeal before the District Court. The first appeal came to be allowed and the decree passed by the Trial Court was quashed and set aside.

8. In such circumstances, the plaintiff went before the High Court by way of Second Appeal under Section 100 of the Civil Procedure Code, 1908.

9. The High Court framed the following substantial question of law for its consideration:-

“Whether the judgment passed by the First Appellate Court is the result of misreading and non-reading of evidence while returning a finding that the defendant Nos.2 and 3 are bona fide purchasers as per Section 19(b) of the Specific Relief Act, 1963.”

10. The High Court after due consideration of all the relevant aspects of the matter recorded a categorical finding that the subsequent purchasers, i.e., the appellants – herein could not be said to be bona fide purchasers in accordance with Section 19 (b) of the Act, 1963 for the reasons assigned as under.

“1. Manjit Singh-defendant No.2 in his oral evidence admitted that defendant No.1 i.e. owner-Bishan Singh is his uncle. It is father and the father of Manjit Singh are co-sharers in one Khata/Khewat of land.

2. It is undisputed that husband of the plaintiff Kishan Singh was mortgagee in possession of the property. Defendant Nos.2 and 3 made no inquiry from Kishan Singh with regard to title of the property which was normal unless there was collusion between defendant No.1 on the one hand and defendants No.2 and 3 on the other hand.

3. From plain reading of sale deed dated 29.08.1986 in favour of defendant Nos.2 and 3 respectively, it is apparent that out of total sale consideration of Rs.25,000/-, Rs.10,000/- is alleged to have already been paid at home whereas Rs.5,000/- was paid in cash before the Sub-Registrar and the balance amount of Rs.10,000/- was kept as a mortgage amount for redemption. No evidence has come on record that there was any prior agreement to sell in favour of the defendant Nos.2 and 3.

4. As per defendant Nos.2 and 3, they paid the amount of Rs.10,000/- at home and Rs.5,000/- at the time of registration. However, no evidence has been adduced to establish that this amount was withdrawn from any bank or from any other source.”

11. Section 19 of the Specific Relief Act upon which strong reliance is sought to be placed has been interpreted by this Court in “R.K. Mohammed Ubaidullah v. Hajee C. Abdul Wahab 2000 (6) SCC 402 wherein this Court held as follows:-

"14. Section 19 of the Specific Relief Act, 1963, to the extent it is relevant, reads:

"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) either party