RSA No.594 of 1995 -1 - IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH RSA No.594 of 1995 Date of Decision: 10.4.2008 Bahadur Ram ..Appellant. Vs. Lakhwinder Singh and others ..Respondents. CORAM : HON'BLE MR.JUSTICE RAKESH KUMAR JAIN * * * Present: Mr.P.S.Saini, Advocate for the appellant. Mr.Arvind Singh, Advocate for respondents. * * * Rakesh Kumar Jain, J. Plaintiff is in appeal against the judgment and decree dated 13.2.1995 passed by the first Appellate Court. In brief, the facts are that the plaintiff filed a suit for specific performance alleging therein that he is in possession of agricultural land measuring 101 Kanals 18 Marlas situated at village Salpani Khurd, Tehsil Thanesar as `Gair Marusi' tenant. Defendants No.1 to 4 were the owners of the suit land who executed an agreement dated 21.7.1983 to sell the land measuring 48 Kanals 19 Marlas being half share of land measuring 97 Kanals 18 Marlas, to the plaintiff for a consideration of Rs.35,000/-. At the time of execution of the agreement, a sum of Rs.9406/- was paid as earnest money and date for execution of sale deed was fixed as 21.11.1983 on payment of remaining sale consideration. Regarding other half share of 97 RSA No.594 of 1995 -2 - Kanals 18 marlas, defendants No.1 to 4 also executed an agreement to sell in favour of Mela Ram son of Bahadur Ram, son of the plaintiff. It was claimed in the plaint that plaintiff had always been ready and willing to perform his part of contract and was present in the office of Sub Registrar, Thanesar on 21.11.1983 but the defendants did not turn up, therefore, he got his presence marked with the Sub Registrar and also got attested one affidavit in that regard. It was further claimed in the plaint that defendants No.1 to 3 sold land measuring 62 Kanals 12 Marlas to defendants No.5 to 8 in the form of four separate sale deeds dated 2.1.1984, three were registered on 4.1.1984 and fourth on 18.4.1984 comprising land measuring 15 Kanals 13 Marlas for a sale consideration of Rs.14,600/- each. The aforesaid sale deeds were executed in the names of individual defendants No.5 to 8. Defendants No.1 to 4 executed another sale deed dated 2.1.1984 registered on 14.8.1986 regarding other land measuring 35 Kanals 5 Marlas for sale consideration of Rs.30,000/- in favour of defendant No.9 in pursuance of Civil Court decree dated 8.4.1986 passed by Sr.Sub Judge, Kurukshetra in suit titled as Smt.Richhpal Kaur versus Smt.Surjit Kaur etc. In that decree dated 8.4.1986, a previous sale deed dated 24.7.1984 of land measuring 20 Kanals 8 Marlas earlier executed by Smt.Jagiro in favour of plaintiff was declared null and void. Therefore, it was claimed that suit for specific performance of Smt.Richhpal Kaur, defendant No.9 which culminated into impugned decree dated 8.4.1986 was illegal and without merit and the subsequent agreement and sale deeds were alleged to be null and void in view of previously existing agreement of sale dated 21.7.1983 in favour of the plaintiff. It was also alleged that defendants No.5 to 9 were in the RSA No.594 of 1995 -3 - knowledge of existence of agreement to sell dated 21.7.1983 but in spite of that, they got the agreement executed on 12.12.1983 as well as five sale deeds from defendants No.1 to 4. In the suit, defendants No.1 to 4 were proceeded against ex parte by the trial Court, however, the suit was contested by defendants No.5 to 9 through their general attorney who filed joint written statement in which it was pleaded that plaintiff has no locus standi to file the present suit; that suit is not maintainable against Chadat Singh, who was a minor; that defendants No.5 to 9 were bonafide purchasers for consideration of the suit land and the possession of the purchased land was handed over to them by the vendors, therefore, plaintiff was estopped by his own act and conduct from filing the suit. On merits, it was pleaded that the plaintiff was never a tenant over the suit land and the alleged tenancy has not been accepted upto the Hon'ble Supreme Court. It was claimed that originally the plaintiff was inducted as a lessee on the suit land by the Collector and after the expiry of period of lease, he has relinquished the possession in writing and had delivered the same to the original owners. It was claimed that plaintiff had left the possession after the crop of Rabi 1982 after that defendants No.5 to 9 asserted themselves to be in physical possession of the suit land. Agreement dated 21.7.1983 by defendants No.1 to 4 in favour of the plaintiff was denied and it was averred that they have purchased another land from the defendants, bona fide enquiries were made and even if the agreement dated 21.7.1983 is proved to have been executed by defendants No.1 to 4, the plaintiff never remained ready and willing to perform his part of contract as he was not possessing sufficient funds. It was pleaded that RSA No.594 of 1995 -4 - sale deed dated 2.1.1984 was got registered from defendants No.1 to 4 on 8.4.1986 pursuant to Civil Court decree whereby the previous sale deed dated 24.7.1984 of land measuring 20 Kanals 8 Marlas in favour of Bahadur Ram was declared null and void, being not binding on the rights of Richhpal Kaur, defendant No.9. In replication, the plaintiff reiterated the averments made in the plaint and denied those of the written statement. From the pleadings of the parties, the following issues were framed by the trial Court : 1. Whether the defendants No.1 to 4 entered into an agreement of sale with plaintiff on 21.7.1983 in respect of the suit land ? OPP. 2. Whether the plaintiff was and is still ready and willing to perform his part of contract ? OPP. 3. Whether the defendants No.1 to 4 have received a sum of Rs.9406/- as earnest money towards sale consideration and if so its effect ? OPP. 4. Whether the defendants No.1 to 4 have committed the breach of contract ? OPP. 5. Whether the defendants No.1 to 4 have further transferred the suit land in favour of defendants No.5 to 9 in contravention of the agreement dated 21.7.1983 and if so its effect ? OPD. 6. Whether the defendants No.5 to 9 are bonafide purchasers for value, without notice and as such sales in their favour are protected under Section 41 of T.P.Act ? OPD. 7. If issue No.6 is proved, whether the plaintiff is entitled for the return of earnest money ? OPD. 8. Whether the suit is not maintainable ? OPD. 9. Whether the defendants No.6 is a minor and if so its effect ? OPD. 10.Whether the suit is time barred ? OPD. 11.Whether the plaintiff is estopped from filing the present suit?OPD. RSA No.594 of 1995 -5 - 12.Whether the plaintiff stands ejected from the suit land and if so its effect ? OPD. 13.Relief. The parties led both oral as well as documentary evidence in support of their case. The trial Court vide its judgment and decree dated 18.2.1993 decreed the suit for specific performance on the basis of agreement to sell dated 21.7.1983 and the defendants No.5 to 9 were directed to execute and register a sale deed of the suit land measuring 48 Kanals 19 Marlas being half share of total land measuring 97 Kanals 18 Marlas in favour of the plaintiff on or before 31.3.1993 provided the plaintiff would pay the balance sale price of Rs.25,994/- at the time of registration of sale deed. It was further held that defendants No.5 to 9 shall be entitled to receive Rs.9406/- i.e. the amount of earnest money earlier paid by the plaintiff, from defendants No.1 to 4. It was further ordered that requisite expenses of stamps and registration etc. shall be borne by the plaintiff. It was further held that if the sale deed is not executed by defendants No.5 to 9 within the time framed, the plaintiff after depositing the remaining sale consideration of Rs.25,994/- in the Court, will be entitled to get execution and registration of such sale deed through the assistance of the Court. The previous sale deed dated 24.7.1984 executed by Smt.Jagiro, defendant No.4 in favour of plaintiff was legal and valid and the earlier Civil Court decree dated 8.4.1986 was declared null and void to that extent. It was also observed by the trial Court that as per the terms of decree dated 8.4.1986, if the plaintiff had already received Rs.12,750/- from Smt.Jagiro, defendant No.4, then defendants No.5 to 9 will be entitled to receive this amount from him and in RSA No.594 of 1995 -6 - case the plaintiff had not received the said amount from Jagiro, then defendants No.5 to 9 will be entitled to recover this amount from her. The aforesaid judgment and decree of the trial Court was however, set aside by the Additional District Judge, Kurukshetra vide his judgment and decree dated 13.2.1995 and dismissed the suit of the plaintiff in entirety. The plaintiff preferred above RSA No.594 of 1995 which was allowed by Learned Single Judge of this Court on 10.8.2001 and the judgment and decree of the trial Court was restored. Defendants No.5 to 9 assailed the order of the learned Single Judge dated 10.8.2001 in Civil Appeal No.4903-4905 of 2004 Chadat Singh Vs. Bahadur Ram and others which was allowed by the Hon'ble Supreme Court vide order dated 3.8.2004. It was held that the High Court has not formulated substantial question of law, therefore, the judgment of the learned Single Judge was set aside and the matter has been remitted to this Court for disposal in accordance with law. After the remand, counsel for the appellant submitted following questions of law involved in this appeal by moving an application dated 26.2.2008. 1. Whether the subsequent vendees can take the plea of readiness and willingness on behalf of the vendors after the registration of sale deed ? 2. Whether the plea of bona fide purchaser can be raised in the present case when the plaintiff was admittedly in possession of land ? RSA No.594 of 1995 -7 - 3. Whether the defendants 5 to 9 are protected under Section 41 of the Transfer of Property Act and can take the plea of bona fide purchasers ? 4. Whether the defendants 1 to 4 have committed breach of contract intentionally and malafidely? Admittedly the vendors defendants No.1 to 4 did not contest the suit. Defendants No.1 to 3 were proceeded ex parte on 3.2.1986 and defendant No.4 was proceeded against ex parte on 30.9.1987. The suit has been contested by defendants No.5 to 9 who are the subsequent vendees. The counsel for the appellant has pressed only first two questions of law referred to above. The first legal submission raised by the counsel for the appellant is as to whether the subsequent vendees can take the plea of readiness and willingness on behalf of the vendors after registration of the sale deed in their favour. In answer to this substantial question, counsel for the appellant has relied upon a decision of the Hon'ble Supreme Court rendered in the case of M.M.S.Investments, Madurai and others Vs. V.V.Veerappan and others 2007(2) RCR (Civil) 816 and contended that plea of readiness and willingness becomes irrelevant because after the conveyance, the only question to be adjudicated is as to whether the purchaser was bona fide purchaser for value without notice. As against this, counsel for respondents No.5 to 9 referred to a decision of the Hon'ble Supreme Court in Ram Awadh (dead) by LRs and others Versus Achhaibar Dubey and another 2000(2) RCR (Civil) 2 to contend that plea of readiness and willingness is also available to RSA No.594 of 1995 -8 - subsequent vendee. So far as the second question is concerned as to whether plea of bona fide purchaser can be raised by subsequent vendee knowing fully well that the plaintiff was admittedly in possession of the suit land, counsel for the appellant referred to decision of the Hon'ble Supreme Court in the cases of R.K.Mohammed Ubaidullah Versus Hajee C.Abdul Wahab (D) by LRs 2000(3) PLR 502 & Ram Niwas (dead) through LRs Vs. Smt.Bano and others 2000(4) RCR (Civil) 83 and decision of this Court in the cases of Joginder Singh Vs. Nidhan Singh 1996(1) PLR 431 and Smt.Krishna Devi and others Vs. Shiv Dev Singh and others 1984 PLR 301. In order to prove his possession, counsel for the appellant has referred to the document Ex.P12 which is an application dated 3.6.1991 moved by the present respondents before AC Ist Grade, Thanesar for delivery of possession of land in question from the plaintiff-appellant. He has also referred to document Ex.P15, which is an order dated 15.6.1992 whereby the aforesaid application dated 3.6.1991 (Ex.P12) moved by defendants No.5 to 9 was dismissed for non-prosecution and was not restored thereafter. On the strength of the above fact, it is argued by the counsel for the appellant that since the plaintiff was not in possession of the suit land at the time of sale to the subsequent vendees respondents No.5 to 9, it was their duty to enquire from the occupant of the land as to the state of affairs existing at that time. In the absence of such enquiry the vendees can not be held to be bona fide purchasers for valuable consideration without notice. It was claimed that no such enquiry was made from the plaintiff by the subsequent vendees about his possession and the existing state of RSA No.594 of 1995 -9 - affairs. It was also asserted that the trial Court has rightly decided issue No.6 pertaining to bona fide purchaser against the defendants but the lower Appellate Court reversed the findings observing that since the lease in favour of the plaintiff had already expired and he had lost up to the Hon'ble Supreme Court so he was in unauthorized occupation of the land and that enquiries were made from the Patwari that there was no encumbrance on the suit land. On the contrary, counsel for the respondents has argued that except for the self serving, statement of Bahadur Ram that after entering into agreement of sale, he had told about the same to the villagers, there is no other cogent evidence that subsequent vendees defendants No.5 to 9 had any notice about the previous agreement. It was further asserted that since the status of Bahadur Ram was not of a tenant but was of a trespasser, question of his being in possession had no bearing at all. Further it was argued that his father had enquired from the revenue Patwari that there was no encumbrance on the suit land and were not aware of the previous agreement to sell dated 21.7.1983, therefore, they are protected as bona fide purchasers. I have heard counsel for the parties and perused the record. So far as the first question is concerned i.e. as to whether the subsequent vendees can take the plea of readiness and willingness on behalf of their vendors after the registration of the sale deed, that has already been answered in the case of M.M.S.Investments, Madurai (supra) in which the Hon'ble Supreme Court, after taking into consideration the decision rendered in the case of Ram Awadh (Dead) by LRs (supra) relied upon by RSA No.594 of 1995 -10 - counsel for the respondents herein, had observed as under : “Questioning the plea of readiness and willingness is a concept relatable to an agreement. After conveyance the question of readiness and willingness is really not relevant. Therefore, the provision of the Specific Relief Act, 1963 (in short the `Act') is not applicable. It is to be noted that the decision in Ram Awadh's case (supra) relates to a case where there was only an agreement. After the conveyance, the only question to be adjudicated is whether the purchaser was a bona fide purchaser for value without notice. In the present case the only issue that can be adjudicated is whether the appellants were bona fide purchasers for value without notice. The question whether the appellants were ready and willing is really of no consequence. In Ram Awadh's case (supra) the question of the effect of a completed sale was not there. Therefore, that decision can not have any application so far as the present case is concerned. Once there is a conveyance the concept would be different and the primary relief could be only cancellation. Learned counsel for the appellants submitted that since the purchasers step into the shoes of the vendor, the question of readiness and willingness can be pressed into service. This plea is clearly without substance because the purchasers had to prove that they are bona fide purchasers for value without notice. The readiness and willingness aspect will not give any relief to them. That being the position, the appeal RSA No.594 of 1995 -11 - is sans merit and is dismissed. There will be no order as to costs.” Since in the present case as well there is a sale deed in favour of respondents No.5 to 9, they can not take the plea that plaintiff was not ready and willing to perform his part of the agreement. Therefore, the first question of law raised by the counsel for the appellant is answered in favour of the appellant and against the respondents. The second question as to whether defendants No.5 to 9 were the bona fide purchasers for consideration or not, that has been discussed by the trial Court while deciding issues No.5 and 6. There are five sale deeds Ex.P3 to Ex.P7 which were executed and registered by defendants No.1 to 4 in favour of defendants No.5 to 9 in pursuance of agreement of sale dated 12.12.1983 Ex.P10. This document has been executed only by Darshan Singh and Sukha Singh in favour of defendants No.5 to 9 vide which they agreed to sell land measuring 97 Kanals 18 Marlas including the suit land for a consideration of Rs.89,000/-. Though it is mentioned in the agreement Ex.P10 that it was being executed on behalf of defendants No.1 to 4 yet only defendants Darshan Singh and Sukha Singh appended their thumb impressions. Smt.Jagir and Surjit Kaur, the two alleged executants did not put their thumb impressions or signatures. But the perusal of four sale deeds Ex.P3 to Ex.P6 reveals that these were executed by Darshan Singh, Sukha Singh and Surjit Kaur in favour of defendants No.5 to 9. In such a situation, sale made by Surjit Kaur creates a doubt about its genuineness specially when Surjit Kaur was not a signatory of the agreement to sell. Moreover, in the four sale deeds Ex.P3 to Ex.P6 there is no mention of Jagir Kaur RSA No.594 of 1995 -12 - defendant No.4 as one of the vendors though she was a co-owner. These sale deeds are on the basis of agreement dated 12.12.1983 which is few days after the last date of the performance of agreement dated 21.7.1983 which clearly indicates that there was a connivance between the vendors & the vendees and the vendees were fully aware about the earlier execution of the agreement to sell. It has come in the statement of PW1 Bahadur Ram that after the execution of agreement, he had told in the village about execution of the said agreement but in spite of that, defendants No.5 to 9 preferred to get execution of sale deeds of the suit land in their favour by defendants No.1 to 4. The statement of PW1 Bahadur Ram has been corroborated by PW3 Dhari Ram. Further, whether the plea of bona fide purchaser can be raised by the defendants when the plaintiff was admittedly in possession of the land in question. This question is again answered by the Hon'ble Supreme Court in the cases of R.K.Mohammed Ubaidullah (supra) and Ram Niwas (Dead) through LRs (supra) and by this Court in the cases of Joginder Singh (supra) and Smt.Krishna Devi (supra) that once the possession is of the plaintiff over the suit land, the subsequent purchaser should make an inquiry as to title or interest of the person in actual possession as on the date when sale transaction was made in his favour. The actual possession of a person itself is deemed or constructive notice of the title if any, of a person who is for the time being in actual possession thereof. A subsequent purchaser has to make inquiry as to further interest, nature of possession and title under which the person was continuing in possession on the date of purchase of the property. There is no evidence led by the respondents that on the date RSA No.594 of 1995 -13 - when they had purchased the suit property i.e. in the year 1984 enquiries were made in respect of the possession of plaintiff over the suit land. Rather an application Ex.P12 was moved much later in the year 1991 seeking possession from the Court of AC Ist Grade, Thanesar on the ground that lease of 20 years in favour of the plaintiff has expired without disclosing the date and that application was not even further prosecuted as the same was dismissed in default vide order dated 15.6.1992 which is on record as Ex.P15. Therefore, defendants No.5 to 9 can not be held to be bona fide purchaser having made enquiries in respect of the possession of the plaintiff on the date of purchase. This question is thus, decided in favour of appellant and against the respondents. In view of the discussion made here-in-above, the present appeal is allowed and the judgment and decree of the first Appellate Court is set aside and the judgment and decree of the trial Court is restored. However, there shall be no order as to costs. (Rakesh Kumar Jain) 10.4.2008 Judge Meenu Note : Whether to be referred to reporter Yes/No.