Present appeal under Section 96 of the Code of

Civil Procedure (for short ‘the CPC’) filed by the plaintiff

aggrieved by the judgment and decree dated 17.04.2015

passed in O.S. No.94/2012 on the file of the Senior Civil

Judge and JMFC, Mudhol, (for short ‘the Trial Court’) by

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which the suit of the plaintiff for relief of specific

performance of a contract and in the alternative for the

relief of refund of earnest money has been dismissed.

It is the case of the plaintiff that defendant No.1

being the absolute owner in possession of immovable

property bearing CTS No.61 measuring 39.38 sq.mtrs. of

Mudhol (hereinafter referred to as ‘the suit property’ for

short), had offered the same for sale to meet his family

necessity. That the plaintiff had agreed to purchase the

suit property for a total sale consideration of Rs.18 lakhs,

of which he paid Rs.15 lakhs as earnest money and in

furtherance thereof defendant No.1 had executed and

registered an agreement of sale dated 06.09.2011. That

the balance sale consideration of Rs.3 lakhs was agreed to

be paid within one year and on receipt of which, defendant

No.1 was required to execute and register sale deed and

handover the physical possession of the suit property.

That the plaintiff being ready with the balance sale

consideration of Rs.3 lakhs had requested the defendant

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No.1 to receive the same and execute deed of sale as

agreed which was complied with constraining the plaintiff

to cause issue of a legal notice dated 16.08.2012. That

defendant No.1 instead of complying with the demand

made in the legal notice with malafide intention of causing

loss to the plaintiff had created a false document namely,

a gift deed on 30.06.2012 in favour of defendant No.2,

who was also aware of the sale transaction between the

plaintiff and defendant No.1. Hence, the plaintiff filed the

suit.

3.

On service of summons, defendant Nos.1 and 2

appeared through their counsel. Defendant No.2 filed

written statement which was adopted by defendant No.1.

In the written statement, defendant No.2 though admitted

herself to be the sister of defendant No.1, denied the

plaint averments. It is specifically contended that the

defendant No.1 was carrying on coconut business and

being in need of money had borrowed money from the

plaintiff who is into money lending business. That on two

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previous occasions, defendant No.1 had borrowed loan

from the plaintiff and had repaid the same. The plaintiff

used to obtain agreements of sale without possession from

the defendant No.1 as security for the repayment of the

loan and on such repayment, those agreements of sale

were being cancelled. She referred to earlier such

agreements dated 06.03.2010 and 27.03.2011, which

were

cancelled

on

11.10.2010

and

06.09.2011

respectively. That the present agreement of sale being the

subject matter of suit is the third such agreement entered

into between the plaintiff and defendant No.1 to secure

the loan advanced by the plaintiff and defendant No.1.

That the defendant No.1 was ready to repay Rs.15 lakhs

to the plaintiff. However, since the plaintiff insisted for

payment of heavy interest, defendant No.1 could not

comply with the demand. That the defendant No.1 being

the absolute owner of the suit property, executed and

registered deed of gift dated 30.06.2012 in favour of

defendant No.2 out of his natural love and affection and

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she has thus become the absolute owner of the suit

property. Hence, sought for dismissal of the suit.

4.

Based on the aforesaid pleadings, the Trial

Court framed the following issues:

1. Whether the plaintiff proves that defendant No.1

executed agreement of sale in respect of CTS No. 61

measuring 39.38 sq.mtrs. situated at Mudhol within

the boundaries shown in paragraph 2 of the plaint, in

favour of plaintiff on 06.09.2011 by receiving earnest

money of Rs.15,00,000/- and agreeing to executed

registered

sale

deed

after

receiving

balance

consideration amount of Rs.3,00,000/- within one

year from