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1996 Supreme(AP) 93

Andhra Pradesh High Court
Judges : B.SUBHASHAN REDDY
Kommineni Seetharamaiah - Appellant
Versus
Kommineni Punnaiah - Respondent
A.No.730/83
Decided On : 02-13-96
Advocates Appeared :
Mr. Gopal Das,Mr. V.L.N.G.K. Murthy

Headnote:CONTRACT ACT, Secs10 & 23 - Consensus ad idem is necessary between parties for entering into contract - Borrowing under pronotes by small farmer stand discharged by operation of law under Act 7 of 77 Same cannot constitute lawful consideration for sale agreement entered into by small farmer

B. SUBHASHAN REDDY, J.

( 1 ) THIS is the plaintiff s appeal against dismissal of his suit for specific performance of contract for sale laid in O. S. No. 280/1979 on the file of the Court of the Subordinate Judge, Guntur. I refer the parties as arrayed in the suit.

( 2 ) THE plaintiff had instituted the above suit claiming the relief of specific performance of the agreement of sale dated 12-11-1978. The defendants are father and son respectively. The suit schedule property is the agricultural land ad measuring 87 cts. The suit was contested and the defendants did not admit the execution of the said agreement, but on the other hand contended that there was no consensus ad idem for entering into the suit agreement and that their signatures were obtained on the blank papers and that in fact, as there were loan transactions, by way of security for repayment of the same, the said papers were obtained. The defendants are poor as compared to the plaintiff and his father, as the latter had substantial properties, both movable and immovable and were lending amounts on interest. There were loan transactions between the parties from 1974 onwards and according to the defendants, even though some amounts have been paid, abnormal interest was added up every time and the loan was shown by the plaintiff s father from whom the borrowings were made, as if the loans were still subsisting. The fact that the agreement of sale was preceded by loan transaction is not disputed even by the plaintiff. In fact, he projects three promissory notes Ex. A-1, dated 29-3-1976, Ex. A-2 dated 28-1-1977 and Ex. A-3, dated 11-2-1978. According to the plaintiff, the amounts borrowed under said Exhibits are Rs. 6,000/-, 5,000/- and Rs. 3,900/- respectively and that Ex. A-1-pronote was got executed in favour of plaintiff s mother - Nagendramma, Ex. A-2 in favour of the sister of the plaintiff s father and Ex. A-3 in favour of one Dandamudi Punnamma, said to be the dose relative of plaintiff and residing with them. The plaintiff had issued notice to the defendants under Ex. A-4 dated 19-10-1978 and even according to the plaintiff, as the defendants had expressed their inability to repay the debt, the contract of sale under Ex. A-10 dated 12-11-1978 was entered into by settling the accounts which came up to a total figure of Rs. 18,126/- and treating Rs. 16,126/- as consideration amount, the defendants had agreed to repay Rs. 2,000/- in cash.

( 3 ) THE parties entered trial and while the plaintiff had examined himself as p. W. I, his father was examined as P. Ws. 2 and 14 others were examined as p. Ws. 3 to 16. The 1st defendant was examined as D. W. 1 and the other witnesses 2 to 4 were examined on behalf of the defendants. Plaintiff had marked exs. A-1 to A-17 and defendants Exs. B-1 to B-7, while through witnesses exs. X-1 to X-6 were marked.

( 4 ) AFTER appraisal of both oral and documentary evidence, the trial court came to the conclusion that the suit agreement of sale was hit by the provisions of A. P. Agricultural Indebtedness (Relief) Act, 1977 (A. P. Act No. 7 of 1977) (hereinafter referred to as the A. P. Act No. 7 of 1977 ).

( 5 ) MR. P. GOPAL Das, the learned counsel for the appellant, did not try to attack the judgment of the trial Court on factual finding and raised a purely legal contention stating that A. P. Act No. 7 of 1977 is inapplicable and that the consideration amount is not unlawful or opposed to public policy and Sec. 23 of Indian Contract Act has got no relevance and that in view of the clinching documentary evidence under Exs. A-1 to A-3 and A-10, the execution of the said documents is beyond doubtand there is no legal embargo for the enforceability of suit agreement, Ex. A-10. He had also cited, in support of his submissions, judicial precedents of this Court in M. Veera Raghavaiah vs. M. Chinna Veeraiah and Kambam Rami Reddy vs. Pallela Rami Reddy and an unreported judgment in c. R. P. No. 2680 of 1977 dated 15-6-1978 and a judgment of the



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