Unregistered agreements for the transfer of property may be admitted as evidence for collateral purposes. Where the execution of such an agreement and the resulting financial liability are admitted by the defendant, the suit for recovery of money is maintainable and the decree is binding.

JUDGMENT :

M.K. Thakker, J.

1 The present appeal is filed under Section 96 of the Code of Civil Procedure, challenging the judgment and decree dated 21.04.2025 passed in Special Civil Suit No.141 of 2012 by the learned Principal Senior Civil Judge, Bhuj-Kuchchh, whereby the suit filed by the present respondent for recovery of an amount of Rs.64,00,000/- along with interest and costs came to be decreed, and the present appellants were directed to pay the said amount with interest at the rate of 6% per annum.

Factual Matrix:

2 The present respondent is the original plaintiff, and the present appellants are the original defendants against whom the suit came to be filed. The case of the plaintiff is that she was holding a distributorship licence in the name of J.P. Gas Distributor of Agies Gas Private Limited, and an agreement dated 01.07.2010 came to be executed for sale of the said distributorship licence in favour of the defendants for a total consideration of Rs.80,00,000/-. It is the contention of the plaintiff that, as per the terms of the agreement, the defendants were required to pay Rs.16,00,000/- every six months towards the cost of the distributorship, including the assets and vehicles of the agency. It is further contended that the plaintiff received Rs.4,00,000/- on 08.06.2010 and Rs.12,00,000/- vide cheque dated 13.12.2010, and thereafter possession of the properties was handed over to the defendants. It is further the case of the plaintiff that the defendants failed to pay the subsequent instalments, and the cheques issued in advance towards such instalments were dishonoured. Consequently, a complaint under Section 138 of the Negotiable Instruments Act came to be filed by the plaintiff, wherein the defendants were convicted, against which a revision application has been filed before this Court and is pending.

2.1. It is also contended that the defendants failed to pay the agreed consideration for the agency and caused serious damage to the movable properties of the plaintiff. The suit came to be filed through a power of attorney holder, namely the husband of the plaintiff, on the basis of a notarized Memorandum of Understanding dated 01.07.2010, seeking recovery as well as a permanent injunction restraining the defendants from transferring or dealing with the agency and its properties, including the premises bearing Shop Nos. D-1 to 8, Shankul-D, Katira Constructions, and the godown constructed on Plot Nos.185 to 187 in Survey Nos.307 and 309 situated at Village Madhapar, along with vehicles bearing Nos. GJ-12-V-8793, GJ-12-Z-2085 (Tempo), and GJ-12-Z-7308 (Chakda). Upon service of summons, the present appellants appeared before the learned trial Court, however, despite sufficient opportunity having been granted, they failed to file their written statement, and accordingly, by order dated 25.11.2013, the stage for filing the written statement came to be closed.

3 Learned trial Court has framed the following issues below Exhibit 28 and answered accordingly:

(1) Whether the plaintiff proves that a Distributorship/Agency Transfer Agreement was executed between the plaintiff and the defendants on 01/07/2010?

Answer is Affirmative.

(2) Whether the plaintiff proves that the defendants have committed default in paying the remaining amount as stipulated in the said agreement?

Answer is Affirmative.

(3) Whether the plaintiff proves that he is entitled to recover the amount from the defendants along with interest at the rate claimed?

Answer is Partly Affirmative.

(4) Whether the plaintiff is entitled to the reliefs as prayed for in the plaint?

Answer is Partly Affirmative.

(5) What order and decree?

As per final order.

3.1. In order to prove the issues framed by the learned trial Court, the power of attorney holder of the plaintiff was examined at Exhibit 54 and produced documentary evidence including the power of attorney at Exhibit 73, the Memorandum of Understanding at Exhibit 74, cheques at Exhibits 75 to 77, written memo at Exhibit 78, n