RSA No. 2445 of 2001 1 In the High Court for the States of Punjab and Haryana at Chandigarh … RSA No. 2445 of 2001(O&M) and RSA No.3963 of 2001 Date of decision: May 28,2009 Dwarka Devi ..Appellant. Versus Oriental Bank of Commerce and others ..Respondents Coram: Hon'ble Mr.Justice Rakesh Kumar Garg Present: Mr. S.D.Sharma,Sr. Advocate with Ms. Bindu Goel, Advocate for the appellant. Mr. N.C.Sahni, Advocate for respondent Nos.1 and 2 Mr. S.C.Nagpal, Advocate for repondnt No.4. ... Rakesh Kumar Garg,J. This judgment shall dispose of two Regular Second Appeals i.e., RSA Nos.2445 of 2001and 3963 of 2001. Both the appeals have arisen out of one common judgment passed in (Civil Appeal No.27/14.2.2000) arising out of Civil Suit No. 130 of 1998-titled as Dwarka Devi Versus Oriental Bank of Commerce and others), on similar facts. As per the averments made in the Civil Suit, Varinder Kumar Sharma Chairman of the erstwhile Bari Doab Bank(defendnat No.3) held a general power of attorney dated 18.10.1993 executed in his favour by Ashish Raj son of Janak Raj, Director of Bari Doab Bank who was authorized to do so vide resolution dated 25.8.1993. It is the further case of the plaintiffs that the defendant Bari Doab Bank Ltd. was owner of Khasra No. 958 situated in the revenue estate of village Premgarh as per jamabandi for the year 1991-92. It was further represented by the aforesaid Varinder Kumar Sharma to the plaintiffs that he was authorized by the General Power of Attorney dated 18.10.1993 given by the Bank to him to sell the land of the bank. The agreement to sell was executed by Varinder Kumar Sharma on behalf of defendant No.3-Bank in RSA No. 2445 of 2001 2 favour of the plaintiff on 25.7.1996. He also received earnest money/part payment towards the sale consideration and it was agreed that the land will be sold at the rate of Rs. 15000/- per marla and the sale deeds will be executed up to 31.1.1997. It was also incorporated in the agreements that the balance sale consideration will be paid at the time of registration of the sale deed and all the expenses for the sale deed shall be borne by the purchaser. It was also stipulated in the agreement that in the event of failure of plaintiff to get the sale deed executed in her favour, the earnest money shall stand forfeited and her right to purchase the land shall be extinguished and in case Bari Doab Bank Ltd. failed to execute the sale deed, the purchaser shall be at liberty to seek recourse to law and shall get the sale deed registered through the court. It was further averred in the suit that the plaintiffs approached the management of the Hoshiarpur Branch of Bari Doab Bank for execution of the sale deed as per the terms of the agreements. However, a reply was given that a moratorium has been imposed upon the Bank by the Reserve Bank of India whereby they have been debarred from sale/purchase of any estate of the Bank through the currency of moratorium period. It was further submitted in the plaint that the plaintiff had always been ready and willing to perform her part of the agreement and was in possession of sufficient funds to pay the remaining sale consideration as well as the necessary expenses and the plaintiff was still ready and willing to perform her part of the agreement. However, none from the side of the defendants came to execute the sale deeds in favour of the plaintiff. The plaintiff came to know that a merger was effected whereby Bari Doab Bank Ltd. was merged into the Oriental Bank of Commerce(defendant Nos.1 and 2) and as per the merger, the Oriental Bank of Commerce being the successor of Bari Doab Bank was bound by the agreement executed by his predecessor. After taking over of the Bari Doab Bank by the Oriental Bank of Commerce, the plaintiff issued notices calling upon defendant No.1 and defendant No.2(i.e.,Oriental Bank of Commerce) to execute the sale deeds in favour of the plaintiff without any further delay. The RSA No. 2445 of 2001 3 said notices were duly served upon the defendant Nos.1 to 3 but none came to execute the sale deeds in favour of the plaintiffs. Hence the suit for possession by way of specific performance of the agreement to Sell with an alternative prayer for liquidated damages was filed. In response to the notices issued by the Court, the defendants appeared and contested the suit by filing joint written statement raising various preliminary objections. On merits, it was submitted that Varinder Kumar Sharma/defendant No.3 had no valid authority to enter into an alleged agreement. Defendant No.3 i.e., Bari Doab Bank being a company was required to pass a resolution for empowering defendant No.4 for entering into such an agreement. It was further submitted that defendant Nos.1 and 2 were not bound by the alleged agreement executed by the defendant No.4 which was beyond his competence. However, it was admitted that moratorium was imposed on defendant No.3 and the merger has taken place vide notification dated 7.4.1997 and the defendant Oriental Bank of Commerce had taken over all the assets and liabilities of the erstwhile Bari Doab Bank. The plaintiff filed replication controverting the averments made in the written statement stating that defendant No.4 had a valid authority on behalf of defendant No.3 to enter into agreement to sell and to execute sale deed in respect of the suit property and defendant No.4 executed various sale deeds prior to the dispute of merger of Bari Doab Bank into the Oriental Bank of Commerce. It was further stated that a valid resolution authorizing defendant No.4 was passed by defendant No.3 and defendant Nos.1 and 2 are bound with the acts of their predecessor which he was duly authorized and competent to do. On the basis of the pleadings, the issues were farmed in each suit and the main/basic issue in all these suits was as under:- “Whether the plaintiff is entitled to the possession of the suit land as prayed for by way of Specific Performance of the Agreement to Sell? RSA No. 2445 of 2001 4 It is relevant to point out at this stage that in the suit, execution of the agreement to sell in question in favour of the plaintiff by Varinder Kumar Sharma, Chairman of the erstwhile Bari Doab Bank was not disputed. What was disputed was the competence of aforesaid Varinder Kumar Sharma to execute the agreement to sell on behalf of the aforesaid Bank. In their evidence, the defendant Bank examined DW1 who clearly admitted that Varinder Kumar Sharma was given the power of attorney on 18.10.1993 by Bari Doab Bank with the power to sell and it was further admitted by this witness that aforesaid Varinder Kumar Sharma had entered into an agreement to sell in question for the sale of the suit land. The receipt of earnest money/part payment by the defendant was also admitted. The trial Court on appreciation of evidence held all the issues in favour of the plaintiffs and decreed the suit with costs for possession by way of specific performance of the agreement to sell in question in the Civil Suit and directed the defendants to execute and register the sale deeds in favour of the plaintiff. Feeling aggrieved there from the judgment and decree of the trial Court, the defendant Nos.1 and 2 Oriental Bank of Commerce filed appeal i.e.,CA No.27/14.2.2000 titled as Oriental Bank of Commerce Versus Dwarka Devi which was accepted and the judgment and decree of the trial Court granting specific performance of the agreement to sell of the plaintiff was set aside and decree of Rs. 20000/- along with interest with proportionate costs in favour of plaintiff-respondent for the alternative relief was passed. RSA No. 2445 of 2001 has been filed by the plaintiff Dwarka Devi challenging the judgment and decree of the lower Appellate Court whereby she has been refused the relief of possession by way of specific performance of the agreement to sell in question. It is relevant to mention here that during the pendency of this appeal, the appellants have moved an application under Order 41 Rule 27 read with Section 151 CPC for permission to place on record copy of letters dated 20.9.1997, 14.11.1997 and 18.2.2009 as additional evidence to show that the authority of Varinder Kumar Sharma was not withdrawn on 30.6.1996 and his RSA No. 2445 of 2001 5 authority was revoked on 30.6.1997, which is clear from the aforesaid documents. I find no merit in this application as the documents sought to be placed on record by way of additional evidence were available to the applicant/appellants at the trial stage and it has not been explained that why the same could not be produced at that stage. Even otherwise, because of the view being taken by me, there is no necessity to allow this application. RSA No. 3963 of 2001 has been filed by defendant No.3/Bari Doab Bank Ltd. challenging the decree of the lower Appellate Court in which, prayer has been made for acceptance of the appeal by setting aside the judgment of the lower Appellate Court and to restore the judgment and decree of the trial Court passed in favour of the plaintiff for specific performance of the agreement to sell.\ In RSA Nos. 2445/2001 and 3963 of 2001 arguments have been raised by the counsel for the appellants that the lower Appellate Court has erred at law while setting aside the decree of specific performance of agreement to sell in question and authority of Varinder Kumar Sharma to execute agreement stood proved and there was no occasion for the lower Appellate Court not to grant the alternative relief of recovery and therefore, the appeals are liable to be accepted. On the basis of the aforesaid arguments, learned counsel for the appellant has argued that the following substantial question of law arises in these appeals:- “Whether the findings of lower Appellate Court are perverse and the plaintiff/appellant appeals could be denied decree of specific performance on the basis of agreement to sell in dispute which stood proved ?” Learned counsel appearing on behalf of the defendant Oriental Bank of Commerce has vehemently argued that both the courts below have failed to appreciate and recognize the real controversy between the parties and have erred in not applying their mind to the only important question involved in the litigation about the competence of Varinder Kumar Sharma to sell away the RSA No. 2445 of 2001 6 property of the bank as its general attorney drawing powers by virtue of the deed of general attorney dated 18.10.1993. According to the counsel for the respondent, the aforesaid document which is a special power of attorney has been misinterpreted by the courts below. As per the arguments raised by the counsel for the defendants, the aforesaid document of General Power of Attorney dated 18.10.1993 gives only limited powers to Varinder Kumar Sharma to execute the sale deed on behalf of the Bank and to tender the documents for registration before the Sub Registrar and to receive the sale consideration or the balance of it on behalf of the Bank and nothing more as he was not empowered to sell away the immoveable property of the Bank nor he was authorized to take a decision himself about the sale of immoveable property of the Bank. The right to sell immoveable property of the Bank and its decision was vested in the Bank and that judgment making power was never extended or delegated to Varinder Kumar Sharma and thus no substantial question of law arises in these appeals and the same are liable to be dismissed. I have heard learned counsel for the parties and perused the record. It is not in dispute that in RSA No.24 of 2004 and other connected appeals which have been decided today, the same Power of Attorney dated 18.10.1993 executed by Bari Doab Bank in favour of Varinder Kumar Sharma was in dispute and the defendant-Bank has disputed the competence of Varinder Kumar Sharma to execute the agreement to sell in favour of the plaintiffs. However,in those appeals, this Court found that the Power of Attorney in favour of Varinder Kumar Sharma was validly executed and he was authorized on the basis of the aforesaid Power of Attorney to sell and to execute agreement to sell the land of the defendant-Bank in favour of the plaintiff. Thus, on the basis of the same reasoning as taken in RSA No.24 of 2004 and other connected appeals, findings of the lower Appellate Court on material issues cannot be sustained and are hereby reversed in favour of the plaintiff-appellant. It was also found by this Court that by virtue of the merger, the defendant Nos.1 RSA No. 2445 of 2001 7 and 2 were bound by the agreements/contracts etc. executed by defendant No.3. It may be noticed that Section 19(d) of the Specific Relief Act, 1963 provides that when a company has entered into a contract and subsequently becomes amalgamated with another company, specific performance of a contract may be enforced against the new company which arises out of the amalgamation. It may also be noticed that no circumstances have been shown to be existing for denying the relief of specific performance to the appellant in the present case Thus the plaintiffs are entitled to the decree of specific performance of the agreement to sell in question. Consequently, the substantial question of law raised by the plaintiff-appellant is answered in his favour and it is held that the plaintiff-appellant is entitled to the decree of specific performance of agreement to sell in question as prayed. Thus RSA No.2445 of 2001 is allowed. RSA No.3963 of 2001 was filed by the defendant No.3 for setting aside the impugned judgment and decree of the lower Appellate Court and for passing of decree of specific performance of the agreement in favour of the plaintiff. The appellant who was defendant No.3 before the trial Court has not filed any separate written statement. It is not established on record of this appeal, how the appellant is aggrieved against the judgment and decree of the lower Appellate Court. Thus,this appeal is not maintainable and the same is dismissed as such. May 28, 2009 (RAKESH KUMAR GARG) nk JUDGE RSA No. 2445 of 2001 8