The main legal point established in the judgment is the interpretation of key legal provisions such as Section 49 of the Registration Act and Section 35 of the Stamp Act, which influenced the court's decision regarding the applicability of Order 12 Rule 6 C.P.C. and the admissibility of an unregistered agreement for sale as evidence for collateral purpose.

Since the L.C.R. has been received, therefore, with the consent of parties counsel, this appeal is being heard finally today.

2. This appeal is directed against the judgment and decree dated 7-11-2012, passed by Civil Judge (S.D.), Nainital, in Suit No. 113 of 2001, Daya Kishore Joshi and another versus Ganesh Singh Karki, whereby the suit of the plaintiff-respondents has been decreed U/O 12 Rule, 6 C.P.C. in favour of plaintiff against the defendant for the recovery of a sum of Rs. ten lakhs along with interest @ 6% per annum.

3. Briefly stated the facts giving rise to the appeal are that the appellant-defendant had entered into an agreement of sale of his land with the plaintiffs and had executed an unregistered agreement of sale in their favour on 27-12-2006. The plaintiffs-respondents had paid a sum of Rs. ten lakhs to the appellant-defendant as earnest money and as per terms and condition of the agreement the sale-deed was to be executed by the defendant-appellant after receiving the rest of the consideration within a period of six months. Rest of the consideration amount was not paid by the plaintiffs-respondents to get the sale deed executed, within time, therefore, the earnest money stood forfeited and the agreement of sale was to be treated as cancelled.

4. The plaintiff-respondents filed suit No. 11/2011, Daya Kishore Joshi and another versus Ganesh Singh Karki, before Civil Judge (S.D.) against the defendant-appellant for the recovery of a sum of Rs. ten lakhs which was paid by them to the defendant as earnest money in respect of the aforesaid agreement for sale.

5. The suit was contested by the defendant-appellant by filing W.S. Thereafter plaintiffs-respondents moved an application before the trial court for decreeing the suit on the basis of admission, against which objections were filed by the defendant-appellant and even then the trial court decreed the suit U/O 12 Rule 6 C.P.C. Since the suit was decreed U/O 12 Rule 6 C.P.C., therefore, no opportunity of evidence was given to either of the parties and no issues were framed in the suit and the suit was decreed summarily on the basis of the fact that the defendant-appellant had received an amount of Rs. ten lakhs as earnest money.

6. Appeal was filed before this Court mainly on two grounds, firstly that the suit U/O 12 Rule 6 C.P.C. can be decreed if the liability to pay the amount in dispute has not been disputed, and secondly the agreement for sale which was executed in favour of respondent-plaintiffs is an unregistered agreement and the same can only be read for collateral purpose after the deficit duty is paid on the instrument i.e. agreement for sale and the court fell into error in decreeing the suit on the basis of this agreement for sale wherein Rs. ten lakhs earnest money was received. In the same agreement there is a clause if the sale deed was not executed within a period of six months the earnest money shall stand forfeited and the agreement would be treated cancelled between the parties.

7. On the issue of Order 12 Rule 6 C.P.C., learned counsel appearing on behalf of appellant has placed reliance upon the judgments of (1) Uttam Singh Duggal and CO. Ltd. versus United Bank of India and others, reported in (2000) 7 Supreme Court Cases 120. It has been held in para-9 of the judgment noted below-

“9. The learned trial Judge took the view that the prerequisites of Order 12 Rule 6 C.P.C. had been satisfied in this case and that on a plain reading of the resolution of the Board dated 30-5-1990 there could be no doubt that the petitioner had made a clear, unambiguous and unconditional acknowledgement of its liability to the Bank. The language of the resolution would show that the extent of the admission in the resolution is for Rs. 10,15,80,000/-, if not for Rs. 10,36.80 lakhs. The figure of Rs. 1015.80 lakhs is firm admission being the figure arrived at after deducting Rs. 21 lakhs claimed by the defendants by reason of fluctuation of the excha