Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Mad) 1417

THE HIGH COURT OF JUDICATURE AT MADRAS
P.B. BALAJI, J.
Nallammal – Appellant
Versus
R.T. Shankar – Respondent
A.S.No.137 of 2023 & CMP.No.10705 of 2025 & CMP.No.5357 of 2023
Decided On : 10-04-2026

Advocates Appeared:
For the Appellant : Mrs. AL. Gandhimathi, Senior Counsel for Mr. L. Palanimuthu
For the Respondent: Mr. R. Veeramani.

Sale agreement treated as loan security based on WhatsApp evidence and party conduct; appeal allowed with refund.

Headnote:The suit concerns an agreement dated 21.09.2016 for sale of properties for Rs.10 lakhs, with Rs.9 lakhs paid as advance and balance Rs.1 lakh due within 9 months. Plaintiff claimed readiness and willingness, issuing notice after delay. Defendant denied sale intent, alleging loan security. Court admitted WhatsApp messages as additional evidence under Order XLI Rule 27 CPC, finding non-compliance with Section 65B Evidence Act curable. Trial court decreed specific performance, rejecting loan defense. Issues framed: validity of agreement as sale or loan; plaintiff's readiness; entitlement to specific performance. Ratio: Messages showed demands for repayment, indicating loan; undue delay in notice and minimal balance payment delay inconsistent with genuine sale intent; no prudent buyer delays for 10% balance. Appeal allowed; trial decree set aside; defendant directed to refund Rs.9 lakhs with 9% interest within three months.

Table of Content
1. summary of suit pleadings, trial, and decree. (Para 1 , 2 , 3 , 4 , 5 , 6)
2. counsel arguments on agreement validity and evidence. (Para 7 , 8 , 9)
3. admission of whatsapp as additional evidence under order xli rule 27. (Para 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19)
4. agreement held as loan security per messages and conduct. (Para 20 , 21 , 22)
5. lack of readiness; appeal allowed with refund. (Para 23 , 24 , 25)

JUDGMENT :

P.B. BALAJI, J.

The defendant in a suit for specific performance, aggrieved by the decree for specific performance granted in O.S.No.2 of 2019, is the appellant.

2.Pleadings:

The plaint in brief:

The defendant offered to sell the suit properties to the plaintiff. The plaintiff accepted the defendant’s offer and an agreement was drawn up in writing on 21.09.2016. The same was also registered. The total sale consideration was fixed at Rs.10 lakhs. The defendant received Rs.9 lakhs towards advance and agreed to complete the transaction within a period of 9 months thereafter, on payment of balance consideration of Rs.1 lakh. The plaintiff has always been ready and willing to perform his part of the contract and get the sale deed executed in his favour. The defendant evaded the plaintiff by not producing the necessary documents. The plaintiff issued a notice on 16.08.2018, calling upon the defendant to comply with the terms and conditions and also to come forward to receive the balance sale consideration of Rs.1 lakh and execute a sale deed in favour of the plaintiff. The defendant, on receipt of the notice, met the plaintiff and assured that he would execute the sale deed in due course. Despite such assurance, the defendant remained evasive and suddenly demanded additional Rs.3 lakhs for execution of sale deed. In view of the unjust demand made by the defendant, the plaintiff has filed the suit.

3.Written statement in brief:

The defendant never offered to sell her lands and approached the plaintiff in that regard. The claims that an agreement was entered into on 21.09.2016 for a sale price of Rs.10 lakhs, out of which, Rs.9 lakhs was received by the defendant on the same day and that 9 months time was fixed are all false. The defendant also denies issuance of lawyer’s notice and that the defendant met the plaintiff thereafter and subsequently demanded further Rs.3 lakhs. The plaintiff is a money lender. The defendant approached the plaintiff for a loan and the plaintiff insisted that the defendant should execute a sale agreement as a pre condition for advancing the loan. It is only under such circumstances, the defendant executed the sale agreement. The property is worth Rs.5 crores. The defendant borrowed only Rs.9 lakhs and the interest agreed for the loan has been duly paid by the defendant, till the date of filing of the suit. The plaintiff has not issued the lawyer’s notice within the period of 9 months, but issued the notice after the lapse of one year. The sale agreement was executed only as a security for the loan transaction and the defendant never agreed to sell her properties. The plaintiff is not entitled to the relief of permanent injunction as long as he has not attained the status of owner.

4.Issued framed by the trial Court:

Based on the pleadings, the trial Court has framed the following issues:

1. Whether the plea that the suit agreement was executed as a security for repayment of the loan of Rs.9,00.000/- obtained by the defendant from the plaintiff is true?

2. Whether the sale agreement dated 21.09.2016 is true and valid?

3. Whether the plaintiff is always ready and willing to perform his part of contract?

4. Whether the plaintiff is entitled for the relief of specific performance?

5. To what other relief the plaintiff is entitled to?

5.Trial:

On the side of the plaintiff, the 1^st plaintiff examined himself as P.W.1 and the witness to the agreement, Ex.A1 one Azhagappan was examined P.W.2 and Ex.A1 to Ex.A7 were marked and on the side of the defendant, D.W.1 to D.W.3 have been exami