The court ruled that a sale agreement intended as security for a loan does not entitle the plaintiff to specific performance, emphasizing the necessity of proving readiness and willingness to perform.

JUDGMENT :

P.B. BALAJI, J.

PRAYER: Second Appeal filed under Section 100 of the Code of Civil Procedure, against the Judgment and Decree of the learned Subordinate Judge of Hosur, dated 10.01.2017 in A.S. No. 11 of 2015 reversing the Judgment and Decree of the learned District Munsif of Denkanikottai, dated 11.02.2015 in O.S. No. 65 of 2007.

1. The unsuccessful defendant in a suit for specific performance is the appellant before this Court.

2. For the sake of convenience, the parties are described as per their litigative status before the Trial Court.

3. The plaintiff filed a suit in O.S.No. 65 of 2007 before the District Munsif Court, Denkanikottai, seeking specific performance of an agreement of sale dated 17.05.2005 for purchasing the suit property. It is the case of the plaintiff that the defendant approached the plaintiff for selling the suit scheduled property measuring 6 cents, comprised of two items of three cents each for a total consideration of Rs.55,000/-. The plaintiff has further pleaded that an advance of Rs.50,000/- was paid on the date of sale agreement itself and for payment of remaining sale consideration of Rs.5,000/-, one year time was mutually agreed upon between the parties. Alleging that despite several requests made by the plaintiff to receive the balance sale consideration and execute the registered sale deed in favour of the plaintiff and also a lawyer's notice dated 16.05.2006, which was evaded by the defendant, the defendant did not come forward to honour the terms of the sale agreement. Pleading readiness and willingness, the suit for specific performance came to be instituted.

4. The defendant filed his written statement stating that there was no intended sale agreement between the parties and it was only a money transaction viz., namely borrowing of Rs.50,000/- by the defendant from the plaintiff and in respect of the said transaction, as surety, the sale agreement was entered into. The defendant further stated that even on 03.06.2003, he had similarly borrowed a sum of Rs.30,000/- from one R.Srinivasan, and after the repayment of the principal and interest amount the nominal sale agreement dated 03.06.2003 was handed over to the defendant. It is the further case of the defendant that out of the three attesting witnesses to the said agreement dated 03.06.2003, two of them are witnesses to the suit sale agreement and even the scribe who prepared the agreement dated 03.06.2003 as well as the suit sale agreement was one and the same person viz., R.Purushothaman. The defendant has further stated that he paid Rs.1,000/-towards interest up to February 2006 and the plaintiff did not acknowledge receipt of any of the amounts paid by the defendant. Only when the plaintiff demanded a raise in the interest rate and the defendant refused to agree to the same, the plaintiff has chosen to demand performance of the agreement of sale and approached the court with the suit for specific performance. It is further contended by the defendant the suit property is situated on the Hosur Denkanikotta Main Road and each of the plots measuring 3 cents was having a market value of Rs.1,80,000/- and only because the sale agreement was a nominal document, the sale consideration was fixed at Rs.55,000/-. The defendant had further stated that there is no necessity for the defendant to sell the suit property as he had shifted from Parandur village to one Pancheswaram village and he had already started constructing a residential house and also laid foundation, spending Rs.1,50,000/- on the suit property. The defendant has further stated that since his father-in-law had assisted him monetarily, the defendant had already settled the suit property in the name of his wife. The defendant also expresses his willingness to repay the principal amount of Rs.50,000/-.

5. Before the Trial Court, the plaintiff examined herself as P.W.1 and the Document Writer, Purushothaman as P.W.2. On the side of the defendant, he examined himself as D.W.1 and