ORAL JUDGMENT

1. This is the appeal filed under Section 100 of CPC by the appellant/defendant, praying for setting aside the judgment and decree dated 11.02.2010 passed in RA No.147/2008 on the file of Fast Track Court-III Hospet (for short ‘First Appellate Court’) by confirming the judgment and decree dated 18.06.2008 in OS No.61/2005 on the file of Additional Civil Judge, (Sr. Dvn.), Hospet (for short ‘trial Court’).

2. Parties would be referred with their ranks, as they were before trial Court for sake of convenience and clarity.

3. Plaintiff has filed the suit before trial court praying for Specific Performance of the agreement dated 24.04.2004 directing the defendants to execute sale deed in his favour by receiving balance sale consideration amount of ₹.40,000/-; for Court costs and such other reliefs. Subsequent to filing of the suit, plaintiff amended the prayer column and inserted alternative prayer for refund of ₹.1,10,000/- advance amount with interest at 24% per annum from the date of agreement till realization.

4. The case of plaintiff before trial Court in nutshell is that defendant No.1 was owner of suit schedule house property and to meet his unavoidable expenses, he agreed to sell suit schedule property to plaintiff for a sum of ₹.1,50,000/- by receiving advance sale consideration amount of ₹.1,10,000/- and executed the registered sale agreement dated 23.04.2004 on 24.04.2004 wherein defendant No.1 acknowledged the receipt of earnest money of Rs.1,10,000/- and also agreed to execute registered sale deed by receiving balance sale consideration amount of ₹.40,000/-. Afterwards defendant No.1 tried to transfer suit schedule property in the name of his wife i.e., defendant No.2 and defendant No.2 tried to mutate khatha into her name before Town Municipal Council, Kampli. Plaintiff objected for the same. Thus, with the apprehension he has filed suit against defendant Nos.1 and 2 and against Town Municipal Counsel, Kampli for the relief of permanent injunction in OS No.114/2004 before Principal Civil Judge, Hospet. Defendant No.1 only to defraud the rights of plaintiff, has executed the gift deed in favour of defendant No.2. Plaintiff has issued legal notice to defendants. Even though, plaintiff was and is always ready and willing to perform his part of contract, defendants intended to sell suit schedule property to third parties only to defraud his rights. Hence, he has also filed criminal case against them and filed the present suit for appropriate reliefs.

5. After service of notice, defendant No.1 filed his written statement which is being adopted by defendant No. 2. In the written statement, defendant No.1 has denied the plaint averments in toto except admitting about Court proceedings. His contention is that he was in dire need of money of ₹.50,000/- as loan and as a security for said loan, defendant No.1 has executed the alleged sale agreement in favour of plaintiff and he never received ₹.1,10,000/- from plaintiff. Furthermore, plaintiff had no capacity to give ₹.1,10,000/- to defendant No.1. Even according to plaintiff, he was only a labourer. Defendant No.1 is an innocent person having no worldly knowledge and he does not know the consequences of execution of sale agreement. Only to protect his property, he has transferred the same into the name of his wife i.e. defendant No.2. Now, defendant No.2 is in possession of it. This property worth more than ₹.8,00,000/-. Even defendant No.1 has discharged loan of ₹.50,000/- to plaintiff. But, plaintiff told that he lost the agreement and believing his words, defendant No.1 kept quiet. Taking undue advantage of innocence of the defendants, plaintiff has filed the false suit. Hence, prayed for dismissal of suit with costs.

6. After impleading the alternative prayer of refund of earnest money, defendants have filed additional written statement wherein they have taken the same contention that they have not received ₹.1,10,0