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2007 Supreme(All) 1352
IN THE HIGH COURT OF ALLAHABAD
Hon. Dilip Gupta, J.
MOHAMMAD IBRAHIM - Appellant
Versus
MOHD.YUSUF - Respondents
Second Appeal 2798 Of 1982
Decided On : 05/01/2007
The judgment emphasizes the discretionary nature of specific performance decrees and the requirements for a transferee to claim the benefit of Section 41 of the Transfer of Property Act.
Headnote:
Specific Performance - Contract - Transfer of Property Act - Section 41, Specific Relief Act - Section 19, 20, 21 - The court discussed the agreements to sell, the benefit of Section 41 of the Transfer of Property Act, and the discretionary nature of specific performance decrees.
Fact of the Case:
The plaintiff filed a suit for specific performance of an agreement to sell a property, claiming that the defendant had received earnest money and failed to execute the sale deed. The defendant contended that the agreement was fictitious and the property had been sold to others.
Finding of the Court:
The Trial Court found in favor of the plaintiff, directing the return of earnest money. The Appellate Court allowed the plaintiff's appeal, decreeing specific performance and directing the defendants to execute the sale deed.
Issues: The issues included the validity of the agreement to sell, the defendants' knowledge of the agreement, and the discretionary nature of specific performance decrees.
Ratio Decidendi: The court found that the plaintiff had proved the agreement and earnest money payment, and the defendants were not entitled to the benefit of Section 41 of the Transfer of Property Act. The court also emphasized the discretionary nature of specific performance decrees.
Final Decision: The Second Appeal was dismissed, affirming the decree for specific performance in favor of the plaintiff.
( 2 ) ORIGINAL Suit No. 130 of 1997 was filed by Mohd. Yusuf initially against Mohd. Iliyas for specific performance of the agreement to sell dated 2nd June, 1976 and in the alternative, for recovery of Rs. 6000/- from the defendant with interest. It was stated in the plaint that the aforesaid agreement to sell dated 2nd June, 1976 was executed between the plaintiff and defendant no. 1 and the same was also registered; that the defendant had received a sum of Rs. 6000/- as earnest money towards the total consideration of Rs. 6500/- and the balance amount of Rs. 500/- was to be paid at the time of execution of the sale deed; that the plaintiff was always ready and willing to perform his part of the contract but the defendant avoided it and, therefore, a notice was sent to the defendant to get the sale deed executed on 1st December, 1976 in the office of the Sub-Registrar and that the plaintiff went to the office of the Sub-Registrar on 1st December, 1976 along with the balance amount of Rs. 500/- but the defendant did not turn up even though the plaintiff waited in the office for the entire day. Written Statement was filed by defendant no. 1 stating inter alia that the plaintiff was his nephew and as there were huge sales tax dues against him and he was afraid that the property may be auctioned and sold for realisation of the said dues, he executed a fictitious agreement to sell the property in favour of the plaintiff; that he never received the amount of Rs. 6,000/- at the time of execution of the agreement; that he had in fact sold the property to Mohd. Ibrahim and Jamil Ahmad through a registered sale deed on 16th May, 1977 for a consideration of Rs. 12,000/- and, therefore, the suit for specific performance was infructuous and was liable to be dismissed.
( 3 ) IN view of the aforesaid statement made in the written statement filed by defendant no. 1, the plaintiff impleaded Mohd. Ibrahim and Jamil Ahmad as defendant nos. 2 and 3. Separate written statements were filed by defendant nos. 2 and 3 mentioning therein that they had purchased the property from defendant no. 1 by a registered sale deed on 16th May, 1976 and they were entitled to the benefit of Section 41 of the Transfer of Property Act as they had acted in good faith after taking reasonable care to ascertain that the transferor had the power to make the transfer. It was also stated that the plaintiff and defendant no. 1 were closely related inasmuch as the plaintiff was the nephew and in order to defeat the claim of defendant nos. 2 and 3, the said suit had been filed.
( 4 ) THE Trial Court framed as many as six issues. The first issue was whether defendant no. 1 had executed to sell dated 2nd June, 1976 in favour of the plaintiff and whether earnest money of Rs. 6,000/- was paid to him at the time of execution of the agreement. The second issue was whether the defendant nos. 2 and 3 had knowledge of this agreement and whether they were entitled to the benefit of Section 41 of the Transfer of Property Act. The third issue that had been framed by the Trial Court was whether defendant no. 1 had executed an agreement to sell dated 1st March, 1976 in favour of defendant nos. 2 and 3. The fourth issue was as to what relief the plaintiff was entitled to while the fifth and sixth issue related to undervaluation of the suit and deficiency of Court Fees.
( 5 ) THE fifth and sixth
