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IN THE HIGH COURT OF CHHATTISGARH AT BILASPUR
Sanjay S. Agrawal, Amitendra Kishore Prasad, JJ
Satyadeo Prasad Sinha – Appellant
Versus
Prabhunath Singh – Respondent
FA No. 676 of 2018

Advocates:
For the Appellants/Petitioners: Rajeev Shrivastava, Prateek Sinha, Kajal Chandra, Kaif Ali Rizvi, Satyadeo Prasad Sinha
For the Respondents: B.P. Singh, Vidya Bhushan Soni, Dilman Rati Minj, K. Radhika

A decree for specific performance of an oral agreement requires clear, cogent proof of the contract's existence and its vital terms. Furthermore, any suit asserting ownership based on the claim that a property was purchased in another's name with the plaintiff's money is barred by law.

Headnote:(A) Code of Civil Procedure, 1908 - Section 96 - Prohibition of Benami Property Transactions Act, 1988 - Sections 2(9) and 4 - Suit for specific performance of contract based on oral agreement - Absence of cogent evidence - Burden of proof. (Paras 1, 6, 9)

(B) Specific Performance - Oral agreement - Essential requirements - Heavy burden lies on the plaintiff to establish existence of concluded contract and its vital terms and conditions including readiness and willingness - Mere bald statement or absence of clear evidence regarding terms results in failure to prove the agreement. (Paras 24, 25, 27, 28)

(C) Benami Transactions - Prohibition - Statutory bar - A claim asserting interest in a property purchased in the name of another, alleging that the consideration was paid by the claimant, is barred under the Act, 1988; such transactions cannot be enforced to assert title. (Paras 6, 32)

Facts of the case:
The respondent (plaintiff) filed a suit for specific performance of an oral agreement to sell, claiming part-interest in properties, alleging he contributed to the purchase price paid into the account of the appellant (defendant). The trial court granted a decree for specific performance. The appellant challenged this, asserting there was no valid oral agreement, the respondent was not in possession, and the suit was barred under the legislation prohibiting benami transactions.

Findings of Court:
The evidence produced did not establish the existence of a valid oral agreement. The witnesses failed to confirm the specific terms or the date of the alleged oral contract. The documentation, including legal notices, was inconsistent with the claims. Furthermore, asserting ownership based on claimed contributions to a purchase made in another's name is statutorily prohibited, rendering the trial court's decree unsustainable.

Issues: Whether an oral agreement to sell was validly executed with clear vital terms and whether the suit claiming interest in property based on alleged payment contributions is barred by the statute prohibiting benami transactions.

Ratio Decidendi: A decree for specific performance cannot be sustained on an oral agreement without definitive and reliable proof of the contract's existence, terms, and the plaintiff's readiness and willingness. Additionally, claims rooted in the assertion that property was purchased benami are strictly barred under the relevant statutory framework.

Result: Appeal allowed; trial court judgment and decree set aside.

Table of Content
1. nature of claim for specific performance and benami property allegations. (Para 1 , 2 , 3 , 4 , 5)
2. arguments concerning validity of oral agreement and jurisdictional bar under benami act. (Para 6 , 7)
3. procedural handling of alleged plaint manipulation and forensic inquiry reports. (Para 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19)
4. requirement to prove fundamental terms of oral agreement for specific performance and benami transaction prohibition. (Para 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33)

Per Sanjay S. Agrawal, J.

1) This appeal has been preferred by the appellant/defendant No.1- Satyadeo Prasad Sinha under Section 96 of the Code of Civil Procedure, 1908, questioning the legality and propriety of the judgment and decree dated 24.10.2018 passed by the Sixth Additional District Judge, Durg, District Durg (C.G.) in Civil Suit No.95-A/2014, whereby, a decree for specific performance of contract based upon an oral agreement to sale was granted to the plaintiff- Prabhunath Singh, while declaring his interest over the land in question as well. The parties shall be referred hereinafter as per their description before the concerned trial Court.

2) The facts, which are essential for adjudication of this appeal are, that the plaintiff- Prabhunath Singh, instituted a suit claiming specific performance of contract based upon an oral agreement to sale and, also for the declaration to the effect that his interests are involved in the suit land, with a further relief of issuance of permanent injunction restraining the defendant No.1- Satyadeo Prasad Sinha from creating any 3rd party interest over the land in question.

3) According to the plaintiff, the land in question, bearing Khasra Nos. 86/2, 86/3, 86/4 and 86/5 admeasuring 0.280 hectare, 0.270 hectare, 0.270 hectare and 0.270 hectare, respectively, total admeasuring 1.090 hectare, situated at village Jamul, Tahsil and District Durg were purchased by him and defendant No.1 after collecting a sum of Rs.1,15,21,000/- (Rupees One Crore Fifteen Lacs Twenty One Thousand) from various persons and deposited the same in the Bank Account of defendant No.1, while assuring the said persons to provide them a constructed house over it. It is pleaded by the plaintiff that he was in close relations with defendant No.1 as they are involved in building construction work and since the Colonizer Licence was not available with him, therefore, after collecting the alleged amount from different persons and that by depositing the same in the Bank Account of defendant No.1, the registered deed of sales for purchasing the alleged suit lands were got registered in his name though, he has equal interest over it. It is pleaded further by the plaintiff that since the defendant No.1 was busy with some other project, therefore, an oral agreement was executed between them on 01.09.2012 in presence of Rahul Siyal and Krishna Kumar Vanwey, according to which, the registered deed of sale was to be executed for a consideration of Rs.40,00,000/- (Rupees Forty Lacs) either in his name, or in the name of the person of his choice and, he paid a sum of Rs.16,00,000/- (Rupees Sixteen Lacs) to him in pursuance thereof, on different dates. Further of his claim is that while in possession over the alleged suit land, he incurred huge amount for the construction of officer staff quarters, servant quarters, boundary wall and gate etc., but owing to escalation in the price of the suit land, the defendant No.1 refused to execute the registered deed of sale in pursuance to the alleged oral agreement and instead, lodged a false report against him on 22.06.2014 before the Police Station, Jamul with an allegation that he has raised the alleged construction work while encroaching the same, which, therefore, compelled him to issue a legal notice on 19.08.2014 for execution of the registered deed of sales in his favour, but neither the reply was given by him, nor has obeyed the

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IN THE HIGH COURT OF CHHATTISGARH AT BILASPURSanjay S. Agrawal, Amitendra Kishore Prasad, JJSatyadeo Prasad Sinha – AppellantVersusPrabhunath Singh – RespondentFA No. 676 of 2018

A decree for specific performance of an oral agreement requires clear, cogent proof of the contract's existence and its vital terms. Furthermore, any suit asserting ownership based on the claim that a property was purchased in another's name with the plaintiff's money is barred by law.

Cases Referred (6)

IN THE HIGH COURT OF CHHATTISGARH AT BILASPUR
Sanjay S. Agrawal, Amitendra Kishore Prasad, JJ
Satyadeo Prasad Sinha – Appellant
Versus
Prabhunath Singh – Respondent
FA No. 676 of 2018