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1985 Supreme(All) 243

IN THE HIGH COURT OF ALLAHABAD
N. N. SHARMA
RAM BRIKSHA SINGH - Appellant
Versus
RUDRA NARAIN SINGH - Respondents
Second Appeal 2099 Of 1974
Decided On : 08/05/1985

Advocates Appeared:
R.N.SINGHA, Sankatha Rai

Under Section 19(b) of the Specific Relief Act, 1963, a subsequent transferee can resist a claim for specific performance of a prior agreement to sell only if he proves that he is a transferee for value who had actually paid the money in good faith and had no notice of the original contract.

Headnote:

SPECIFIC RELIEF ACT, 1963 - SECTION 19(B) - SALE OF PROPERTY - NOTICE OF PRIOR AGREEMENT - BURDEN OF PROOF - TRANSFER FOR VALUE - BONA FIDE PURCHASER - INTERPRETATION OF SECTION 19(B) AND ITS APPLICATION IN DETERMINING THE RIGHTS OF PARTIES IN A DISPUTE INVOLVING SALE OF PROPERTY SUBJECT TO A PRIOR AGREEMENT.

Fact of the Case:

Plaintiff claimed that he had an agreement to purchase a property from Defendant 1, Smt. Dhanwanti, and paid a sum of Rs. 1500/- as earnest money. However, Defendant 1 subsequently sold the property to Defendants 2 to 7 by a sale deed executed on 29-1-1973. Plaintiff filed a suit seeking specific performance of the agreement to sell and possession of the property.

Finding of the Court:

The trial court dismissed the suit, holding that the agreement to sell was not executed by Defendant 1 and that Defendants 2 to 7 were bona fide purchasers for value without notice of the prior agreement. On appeal, the lower appellate court reversed the trial court's decision and decreed the suit in favor of the plaintiff.

Issues: 1. Whether the agreement to sell was executed by Defendant 1, Smt. Dhanwanti? 2. Whether Defendants 2 to 7 were bona fide purchasers for value without notice of the prior agreement?

Ratio Decidendi: 1. The lower appellate court correctly appreciated the evidence and found that the agreement to sell was executed by Defendant 1, Smt. Dhanwanti. The court considered the testimony of the witnesses, the circumstances surrounding the execution of the agreement, and the conduct of the parties. 2. The burden of proving that they were bona fide purchasers for value without notice of the prior agreement lay on Defendants 2 to 7. The lower appellate court found that they failed to discharge this burden. The court considered the evidence of payment of consideration, the relationship between Defendant 1 and Defendant 2, and the fact that Defendant 2 was a neighbor of Defendant 1.

Final Decision: The appeal was dismissed, upholding the decision of the lower appellate court. The court held that the plaintiff was entitled to specific performance of the agreement to sell and possession of the property.

N. N. SHARMA, J.

( 1 ) THIS is an appeal by defendants, second set, directed against judgment and decree recorded by Sri M. G. Godbole, learned IVth Additional District Judge, Varanasi who allowed Civil Appeal No. 186 of 1974 on 13-9-1974 and reversed the judgment and decree dt. 26-3-1974 drawn by Sri D. P. Varshney, learned Munsif, Havali, Varanasi who dismissed plaintiffs suit No. 122 of 1973 with costs.

( 2 ) DISPUTE relates to house and bamboo clump as detailed at the foot of the plaint, situate in village Mandaw, Pargana Dehat Amanat, district Varanasi.

( 3 ) PLAINTIFF Rudra Narain Singh is respondent 1. Smt Dhanwanti defendant No. 1 is respondent No. 2. Appellants Ram Briksha Singh and his sons are the vendees of the aforesaid house and bamboo clump by virtue of a sale deed executed in their favour by Smt. Dhanwanti on 29-1-1973.


( 4 ) PLAINTIFFS case was that Smt. Dhanwanti agreed to sell the aforesaid property in his favour for a sum of Rs. 2000/- and an agreement to sell was executed by her. Out of the sale consideration, Rs. 1500/- was paid by plaintiff at the time of execution of the agreement while the balance was payable at the time of registration of the document. The sale deed was to be executed within three months after getting the balance of sale consideration vide recital in Ext. 1 dt. 23-12-1972. Plaintiff was ever willing to perform his part of contract but the defendant 1 is evading the same as she colluded with defendant 2 and surreptitiously executed a sale deed in respect of this very property in favour of defendants 2 to 7, on 29-1-1973.

( 5 ) PLAINTIFF further averred that the said defendants were not bona fide transferees for value and had notice of the prior agreement of sale in favour of plaintiff.

( 6 ) BOTH the sets of defendants filed their written statement raising similar pleas. They clearly denied the execution of the agreement dt 23-12-1972 in favour of plaintiff Defendant 1 Smt Dhanwanti also denied that she received Rs. 1500/- as earnest money from plaintiff. She pleaded that the sale deed in favour of defendants second set was executed by her for a consideration of Rs. 1000/ -. Defendants 2 to 7 further pleaded that they were transferees for value without notice and had got the sale deed executed in good faith.

( 7 ) LEARNED Munsif found that the defendant 1 Smt Dhanwanti had not executed the agreement dt 23-12-1972 in favour of plaintiff nor realised Rs. 1500/- as earnest money. Defendants 3 to 7 were purchasers in good faith without notice. In the result, the suit was dismissed with costs as given above.

( 8 ) THE aforesaid findings were reversed in appeal.

( 9 ) I have heard learned counsel for parties and carefully perused the record.

( 10 ) THE first contention put forward on behalf of appellants was that the learned lower appellate Court did not take notice of the fact that defendant 1 Smt. Dhanwanti was an old, illiterate lady and the law threw its protection around such lady and a person dealing with such lady was bound to establish that the execution of the document was her intelligent act and she was not the victim of any fraud or misrepresentation or undue influence. Reliance was placed upon Parasnath Rai v. Tileshre Kuar, reported in 1965 All LJ 1080 where the aforesaid principle was enunciated. In that case the deed was executed by a Paradahnashin lady and had not been executed by her voluntarily and after appreciating the nature and import of the transaction and so the sale transaction was struck down. It was held that in such cases, it was not for the lady to prove any fraud, misrepresentation or undue influence for holding that the deed was not binding on her. If the Court finds that the documents had not been voluntarily executed by the lady after appreciating the nature and import of the transaction, such fact alone was sufficient for holding that the deed was not binding on her.

( 11 ) THE next authority relied upon by learned Advocate for appellants was reported in Afsa

























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