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1999 Supreme(P&H) 1354

PUNJAB AND HARYANA HIGH COURT
M.L. Singhal, J.
Rukna - Appellant
Versus
Wali Mohd. - Respondent
R.S.A. No. 3167 of 1998.
Decided On : 3 November, 1999

Advocates Appeared:
For the Appellant :Mr. G.S. Bhatia, Advocate.
For the Respondents:Mr. Arihant Jain, Advocate.

An agreement to sell immovable property does not create any interest in or charge on such property and does not confer any title on the vendee. The vendee becomes the owner of the property only if there is a transfer of property to him from the vendor.

Headnote:

SPECIFIC PERFORMANCE - AGREEMENT TO SELL - SECTION 54, TRANSFER OF PROPERTY ACT - SECTION 17, REGISTRATION ACT - SUMMARY

Fact of the Case:

Plaintiff filed a suit for specific performance of an agreement to sell land, alleging that he had paid Rs. 35,000 as earnest money and was ready to pay the remaining Rs. 3,000. The defendant denied executing the agreement and claimed that the plaintiff had taken advantage of his simplicity and illiteracy to fabricate it.

Finding of the Court:

The trial court and the appellate court found that the agreement to sell was genuine and that the defendant had defaulted in executing the sale deed. They decreed the plaintiff's suit for specific performance.

Issues: 1. Whether the agreement to sell was genuine and enforceable. 2. Whether the plaintiff was ready and willing to perform his part of the contract. 3. Whether the defendant defaulted in executing the sale deed.

Ratio Decidendi: 1. An agreement to sell is a contract that a sale of immovable property shall take place on terms settled between the parties. It does not, of itself, create any interest in or charge on such property. 2. Delivery of possession under an agreement to sell does not make the agreement to sell any the better. The vendee does not become the owner of the property. He will become the owner thereof only if there is a transfer of property to him from the vendor. 3. When a title to the goods passes under the contract, it is a sale. When a title does not pass, the contract is an agreement to sell.

Final Decision: The appeal was dismissed, and the trial court's decree for specific performance was upheld.

JUDGMENT

M.L. Singhal, J. - Wali Mohmad instituted suit for possession through specific performance of the agreement to sell dated 24.5.1989 against Rukna son of Nikka respecting land measuring 3 bighas situated in the area of Village Azimabad Tehsil Malerkotla on payment of Rs. 38,000/- minus Rs. 35000/- paid as earnest money or on payment of whatever amount is adjudged by the Court payable to Rukna, in the alternative, for the recovery of Rs. 38000/- as damages i.e. Rs. 35000/- as earnest money plus Rs. 3000/- as damages and also for permanent injunction restraining him from interfering with his possession or alienating the land in any manner whatever to any one else. It was alleged in the plaint that on 24.5.1989, Rukna son of Nikka defendant executed an agreement to sell land measuring 3 bighas to him for a sum of Rs. 38000/-. Out of sum of Rs. 38000/-, Rs. 35000/- was paid to him as earnest money. It was stipulated in the agreement that defendant shall execute sale deed in favour of the plaintiff or in whose favour the plaintiff wanted him to execute sale deed, till 25.5.1992. Defendant put him in possession of the land at the spot. It was stipulated in the agreement that in case defendant defaulted and failed to execute sale deed as per stipulations, the plaintiff could compel him to execute sale deed through the process of the Court. Plaintiff had always been ready and willing to pay the remaining sum of Rs. 3000/- to the defendant and obtain from him the sale deed but the defendant defaulted. A week prior to 25.5.1992, the plaintiff tendered to the defendant a sum of Rs. 3000/- and told him that he was ready to go ahead and obtain sale deed but to no effect. On 5.5.1992, the plaintiff served registered AD notice to the defendant calling upon him to execute sale deed as stipulated and also that he was ready and willing to pay him the remaining sum of Rs. 3000/- and spend the stamp and registration charges and to obtain sale deed from him. Defendant gave reply to that notice on 20.5.1992 denying without any basis his liability to perform his part of contract. On 25.5.1992, he reached the office of Sub Registrar with the amount of Rs. 3000/- as also the amount required for stamp and registration charges. He waited for the defendant till 5 p.m. but he did not turn up. Thereupon, he got his affidavit attested from Shri Sehwaj Khan, Advocate (Oath Commissioner) on stamp paper which was indicative of his readiness and willingness to perform his part of agreement and the absence of readiness and willingness to perform his part of the agreement by the defendant.

2. Defendant contested the suit of the plaintiff urging that he never executed any agreement to sell dated 24.5.1989 in favour of the plaintiff. It was denied that he received any sum of Rs. 35000/- as earnest money. Agreement set up was false and forged. In fact land measuring 6 bighas 5 biswas belonging to him was under mortgage with the plaintiff in the sum of Rs. 16000/-. On 24.5.1989, defendant came to the Tehsil premises alongwith the plaintiff so that he could repay him the mortgage debt. He repaid him Rs. 16000/- as mortgage debt in the presence of Gurdev Singh; son of Bachan Singh. At the same time, he repaid Rs. 14500/- to that Gurdev Singh also on account of some writing. Plaintiff took advantage of his simplicity and illiteracy and fabricated the so called agreement to sell.

3. On these pleadings of the parties, the following issues were framed by the learned trial Court :-

1. Whether the defendant executed agreement to sell dated 24.5.89 as alleged ? OPP

2. Whether the defendant received Rs. 35000/- as earnest money from the plaintiff at the time of execution of agreement to sell ? OPP

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

4. Whether the agreement to sell dated 24.5.89 is forged and fictitious document ? OPD

5. Whether the plaintiff is entitled for the specific performance of the contract or in the altern




























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