Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Mad) 1069

BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
P.B. BALAJI, J.
Amala - Appellant
Versus
Kulasamuthu - Respondent
SA(MD) No. 118 of 2026, CMP(MD) No.3884 of 2026
Decided On : 30-04-2026

Advocates Appeared:
For the Appellant : Mr.S.Mukunth, Senior Counsel for Mrs.Indira
For the Respondent: Mr.N.Ganagasapapathy

Appellate court admitting additional evidence under Order XLI Rule 27 CPC must follow Rules 28 and 29, providing rebuttal opportunity via evidence recording or remand, else prejudice results requiring limited remand.

Headnote:(A) Code of Civil Procedure, 1908 - Order XLI Rules 27, 28 and 29 - Specific performance suit - Defence of loan transaction with agreement as security - Additional documents relating to parallel recovery suit on promissory note executed same date permitted in first appeal as incidental to pleaded defence despite absence of specific pleadings - However, appellate court allowing additional evidence must mandatorily either record evidence itself or remit to lower court under Rule 28 and specify issues under Rule 29, affording opportunity to rebut/cross-examine failing which causes prejudice requiring remand. (Paras 4, 9.1 to 9.9)

(B) Specific Relief - Suit agreement for immovable property providing two years for balance payment between relatives - Does not ipso facto establish loan where trial court decreed specific performance - Readiness and willingness to be tested post opportunity on additional evidence. (Paras 6.1, 9.8, 9.10)

Facts of the case:
Suit for specific performance of registered agreement to sell approximately 4 cents for Rs.7.5 lakhs with Rs.7 lakhs paid advance and two years for balance decreed by trial court holding defence of loan not proved. First appellate court admitted additional evidence of recovery suit for Rs.18.5 lakhs on same-date promissory note between parties, reversed decree holding transaction loan without affording rebuttal opportunity.

Findings of Court:
Admission of additional evidence proper but procedure under Order XLI Rules 28 and 29 not followed; matter remitted for cross-examination on additional documents within four weeks and fresh disposal of appeal within two months thereafter.

Issues: Whether additional documents absent specific pleadings could be relied to reverse trial findings; whether first appellate court complied with procedural safeguards post admission of additional evidence.

Ratio Decidendi: Pleaded defence of loan transaction suffices for related additional evidence under Order XLI Rule 27; mandatory compliance with Rules 28 and 29 essential for fairness, denial of rebuttal opportunity vitiates judgment warranting limited remand. Result : Second appeal allowed; judgment of first appellate court set aside and matter remitted.

Table of Content
1. appeal challenges reversal using unpleaded additional loan documents. (Para 1 , 2 , 3 , 4 , 5)
2. no rebuttal opportunity violates order 41 rule 28 cpc. (Para 6)
3. additional evidence incidental to existing loan defense plea. (Para 7)
4. admission proper but rules 28-29 require rebuttal opportunity. (Para 8 , 9)
5. remit for cross-examination and fresh appellate disposal. (Para 10)

JUDGMENT :

P.B. BALAJI, J.

The plaintiff in O.S.No.55 of 2022, being a suit for specific performance, is the appellant, aggrieved by the reversal findings rendered by the first appellate Court.

2. For the sake of convenience, the parties are referred to as per their rank before the trial Court.

3. I have heard Mr.S.Mukunth, learned Senior Counsel appearing for the appellant / plaintiff and Mr.N.Ganagasapapathy, learned counsel for the respondent / defendant.

4. The second appeal was admitted on 09.04.2026 on the following substantial question of law:

“ I. Whether the additional documents marked as Ex.B2 to Ex.B10, produced before the first appellate Court in the absence of any pleadings relating to them, would entitle the first appellate Court to rely upon those documents and reverse the findings of the trial Court by holding that the suit agreement was a sale agreement and not a loan transaction?

5. Brief facts that are necessary for decision in the second appeal are as follows:

The plaintiff sought for specific performance of an agreement dated 22.11.2019 in respect of approximately 4 cents. The suit was resisted by the defendants contending that the defendant had only borrowed a loan and never intended to sell the suit property to the plaintiff. The trial Court finding that the defendant had not established the plea that it was only a loan transaction and the agreement was executed for security purpose, proceeded to grant a decree for specific performance. Pending the first Appeal filed by the defendant, an application was taken out for adducing additional evidence and Ex.B2 to Ex.B10 were sought to be marked on the side of the defendant. The first appellate Court allowed the application and referring to the additional documents, non suited the plaintiff by finding that the transaction was only a loan transaction and the defendant never intended to sell the suit property to the plaintiff.

6. Arguments of Mr.S.Mukunth, learned Senior Counsel for appellant/plaintiff:

6.1. Firstly, it is contended by the learned Senior Counsel, Mr.S.Mukunth, that once the first appellate Court had come to a decision that the additional documents ought to be received in evidence, then the Court ought to have granted an opportunity to the appellant / plaintiff to rebut the said additional evidence. He would point out that there has been no opportunity that has been given to the appellant / plaintiff and therefore, on this very ground of failure to apply the mandate of Order XLI (41) Rule 27 and Rule 28 of the Code of Civil Procedure , the judgment of the first Appellate Court, relying on the additional evidence has to be necessarily set aside. He would also invite my attention to the fact that the sale consideration was Rs.7.5 lakhs and Rs.7 lakhs had already been paid as advance and the remaining Rs.50,000/- was also paid immediately after the decree passed by the trial Court and the plaintiff had established her readiness and willingness entitling her to a decree of specific performance.

6.2. Mr.S.Mukunth, learned Senior Counsel, would further state that the defendant, who sought to adduce additional evidence by way of marking documents relating to a suit for recovery of money between the same parties before the Poonamalli District Court should not have been afforded an opportunity for the simple reason that the defendant had not pleaded about the said suit in the written statement. It is therefore contended by the learned Senior Counsel that in the absence of pleadings, no evidence should be permitted.

6.3. Drawing my attention to the memorandum of second appeal