RSA No.2123 of 2010 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH RSA No.2123 of 2010 (O&M) Date of Decision: 1.12.2011 Balbir Singh ...Appellant Vs. Pirthi Singh & Ors. ...Respondents BEFORE: HON'BLE MR.JUSTICE A.N.JINDAL Present: Mr.Arvind Singh, Advocate, for the appellant. Mr.R.S.Budhwar, Advocate, for respondent No.2. None for respondents Nos. 1 & 3. --- A.N.Jindal, J. Trial court vide judgment dated 24.01.2008 partly decreed the suit of the plaintiff/appellant (herein referred as the plaintiff) for for recovery of Rs.1,70,000/-. However, it declined the relief of specific performance. On appeal by the plaintiff/appellant (herein referred as the plaintiff), District Judge, Kurukhsetra vide his judgment dated 26.03.2010 dismissed the same. Still dissatisfied the plaintiff has come up in regular second appeal for seeking the relief of specific RSA No.2123 of 2010 2 performance. Defendant No.1 being the owner of 16 kanals i.e. 2560/25560th share out of total land measuring 159 kanals 15 marlas comprised in Khewat No.14/1 Khatauni No.43-Min, as fully detailed in the heading of the plaint situated at village Khera, Tehsil Thanesar, District Kurukshetra had mortgaged his land for a sum of Rs.40,000/- in favour of defendant No.3 on 17.3.1994 by executing registered mortgage deed. Again on 14.3.1996 he entered into an agreement of sale with him for a total consideration of Rs.2,80,000/- out of which he paid a sum of Rs.85,000/- as earnest money on 28.11.1996 and sale deed was to be executed on or before 5.3.1997 after receiving the balance sale consideration by defendant No.1. It was also agreed that if defendant No.1 failed to perform his part of the contract within the stipulated period then the plaintiff would be at liberty to get the sale deed executed and registered through the court. In the event of failure of defendant No.1 to perform his part of the contract he was liable to pay double the amount of the earnest money and if the plaintiff fails to perform his part of the contract then his earnest money was to be forfeited. The plaintiff further pleaded that defendant No.1 instead of executing the sale deed in his favour executed the sale deed in favour of defendant No.2 on 7.8.1997. Thus, he while filing suit for specific performance, also challenged the sale deed executed by defendant No.1 in favour of defendant No.2. Defendant No.1 in his written statement has admitted that RSA No.2123 of 2010 3 the suit land was mortgaged with defendant No.3 for a sum of Rs.40,000/- vide registered mortgage deed dated 17.3.1994. He has also admitted the execution of the agreement to sell dated 14.3.1996 by him in favour of the plaintiff in the presence of the witnesses and also added that he could not perform his part of agreement due to unavoidable circumstances. He could not appear before the Sub Registrar on 5.3.1997 due to his family problem. Thus, he has prayed for decreeing the suit in favour of the plaintiff. Defendant No.2, in her separate written statement, has pleaded that the suit is false, frivolous and not sustainable; the plaintiff is estopped by his own act and conduct from filing the suit because he was having knowledge of the execution of the agreement to sell dated 14.3.1996 as well as sale deeds dated 7.8.1997 and 11.12.1997 in her favour by defendant No.1 from the very beginning. The plaintiff has concealed the material facts from the Court, therefore, he is not entitled to the discretionary relief of specific performance. The claim of the plaintiff is not based on bona fides; the suit is bad for non-joinder and mis-joinder of parties. She is a bona fide purchaser for valuable consideration and without any knowledge of the alleged agreement to sell dated 14.3.1996. The defendant No.1 was the owner in possession of the suit land and after the purchase, she is recorded owner in possession thereof. The sale deeds dated 7.8.1997 and 11.12.1997 executed in her favour are quite legal, valid and binding on the defendant no.1. After the purchase, the mutation has also been sanctioned in her favour. While RSA No.2123 of 2010 4 denying other allegations, she prayed for dismissal of the suit. Defendant No.3 while adding to the pleas as set up by defendant No.2, has further stated that the plaintiff has no cause of action or locus standi to maintain the suit and the suit is barred by limitation. The alleged agreement dated 14.3.1996 is a fake and forged document. The original agreement has not been produced by the plaintiff. He being the mortgagee for Rs.40,000/-, is entitled to the same along with interest at the rate of 2% per month with effect from 17.3.94 till the payment of the said amount. The plaintiff cannot file the suit without redeeming the land from him. In fact, he (defendant No.3) is a perspective vendee vide agreement to sell dated 29.3.96 executed in his favour after receiving a sum of Rs.50,000/-. Thereafter, the defendant No.1 got extended the date of said agreement after receiving a further sum of Rs.50,000/- from him. The alleged sale deed in favour of defendant No.2 is null and void. He (defendant No.3) has filed the suit for specific performance on the basis of the agreement to sell dated 29.3.96 wherein he has also challenged the sale deed dated 7.8.1997 executed in favour of defendant No.2. While denying the other allegations, he also prayed for the dismissal of the suit. Replication was also filed. From the pleadings of the parties as aforesaid, trial court framed the following issues:- 1. Whether plaintiff is entitled to possession of suit land by way of specific performance on the basis of agreement dated 29.3.1996?OPP RSA No.2123 of 2010 5 2. Whether plaintiff is estopped by his own act and conduct from filing the present suit? OPD 3. Whether the suit of the plaintiff is bad for non- joinder and mis-joinder of the parties? OPD 4. Whether the plaintiff has concealed with true and material facts, if so, its effect? OPD 5. Whether defendant No.2 is bona fide purchaser of the suit land, if so, its effect? OPD Again the following additional issues were framed by the learned lower court on 5.4.2006: 1-A Whether plaintiff is estopped from filing the present suit by his own act and conduct? OPD 1-B Whether defendant No.2 is a bona fide purchaser for consideration without having knowledge with regard to agreement to sell dated 14.3.96 and therefore, his ownership and possession over the suit property through sale deed dated 7.8.97/11.12.97 is protected? OPD-2 1-C Relief. Both the parties led evidence. Having scrutinized the evidence, the trial court came to the conclusion that plaintiff was not entitled to the relief of specific performance but was entitled only to recover the amount. Appellate court also affirmed the judgment as such, the RSA No.2123 of 2010 6 plaintiff is now in regular second appeal. Short point raised by the appellant at this stage is that though he does not agitate with regard to declining of relief of specific performance to him yet the judgment is invalid inasmuch as though defendant No.1 enjoyed sum of Rs.1,70,000/- since the date of execution of the agreement i.e. 29.03.1996 and did not return the same and defendant No.1 having transferred the said land during the pendency of the agreement is, at least to be burdened with liability to pay the interest and the same could be recovered from the land in question which was covered by sale deed. There is no denying of fact that agreement executed by defendant No.1 in favour of plaintiff stands proved. It is also proved on the record that the defendant No.2 is a bona fide purchaser for value without notice but at the same time the defendant No.1 is liable to pay the interest on the amount which he had enjoyed since the date of agreement i.e. 29.3.1996, It would also be significant to mention here that earnest money of Rs.85,000/- was paid by the plaintiff. However, as per terms of the agreement, a suit for a sum of Rs.1,70,000/- i.e. double the amount of earnest money was decreed by the trial court. As such the plaintiff having claimed damages is not entitled to recover interest from the date of agreement till passing of the decree of the trial court i.e. 24.1.2008. However, the plaintiff would be entitled to reasonable interest i.e. at the rate of 10% per annum from the date of decree passed by the trial court till realization. As such relief RSA No.2123 of 2010 7 clause is accordingly modified. In the wake of aforesaid discussions, the appeal is partly accepted and it is ordered that the plaintiff would be entitled to recover a sum of Rs.1,70,000/- along with interest at the rate of 10% per annum from the date of passing of the decree by the trial court till realization of decretal amount along with costs of both the courts below from the defendant No.1. Decree sheet be prepared accordingly. (A.N.Jindal) 1.12.2011 Judge rp