Sirdar K.B.Ramachandra Raj Urs (Dead) ... vs Sarah C Urs

5. The defendant No.1, made the correspondence with the Income Tax Department to obtain the Income Tax clearance. However, the need to seek permission under the Urban Land Ceiling Authority vanished as per the decision of this Court concerning section 27 of the said Act as defendant No.1 was postponing to execute the registered sale deed on one pretext or the other. A legal notice dated 5.6.1990 was served, and after that, the suit had been filed on 19.9.1990 seeking specific performance.

7. The defendants denied the receipt of the sale consideration on 4 24.4.1979 and 1.6.1993 and also the subsequent correspondence between plaintiff No.2 and defendant No.1 and his Tax Consultant. The 2nd plaintiff was never permitted to put up construction on the property by the defendant No.1. After the demise of Princess Leelavathi, the suit property devolved on late K. Basavaraja Urs and defendant No.1. The 1st defendant has not conveyed his interest in the suit property in favour of plaintiffs. Defendants contended that no agreement was entered into with the plaintiffs. The suit is barred by time.

9. The trial court decreed the suit and recorded a finding that the agreement has been executed on 24.4.1979. The defendant No.1 has admitted his signatures on the suit agreement dated 24.4.1979 and receipt dated 1.6.1983. Defendant No.1 for himself and as a power of attorney holder of late K. Basavaraja Urs, executed the suit agreement and, therefore, he cannot be permitted to contend that he is not a party to the suit agreement in his individual capacity. They were required to obtain an income tax clearance certificate and after that to 5 execute the registered sale deed, in which they have failed. Late K. Basavaraja Urs owned vast landed and house properties at Bangalore and Mysore. They were statutorily bound to obtain a clearance certificate from the Income Tax Department, and as they failed to obtain it, they cannot be permitted to contend that suit is barred by limitation. The High Court has affirmed the findings of the trial court.

10. The High Court has disbelieved the case set up by defendant No.1 that he had put his signatures on blank paper. Plaintiff No.2 was appointed as Judge of the High Court during September 1978; therefore, on 24.4.1979, there was no fiduciary relationship between them. Plaintiffs have also produced the original stamped receipt dated 1.6.1983 (Exhibit P­19) admitting the receipt of remaining Rs.50,000 by defendants No.1 in which a sum of Rs.42,000 was paid in cash and Rs.8,000 was paid by cheque. Defendant No.1 had admitted his signatures on Exh. P­19. Defendant No.1 also admitted that he had encashed the cheque. The plea of the 1 st defendant is false and thus cannot be accepted. The High Court has also referred to the order passed by the Income Tax Appellate Tribunal wherein the claim of 2 nd plaintiff for exemption of Rs.50,000 under the Income Tax Act, paid to 1st defendant towards the remaining sale consideration was allowed in terms of section 54(F) of Income Tax Act.

11. The High Court has further found that the defendant has taken an inconsistent and contrary stand. The defendant was visiting 2 nd plaintiff all along insisting on obtaining Income Tax Clearance Certificate, which was postponed by the defendant No.1 on one pretext or the other. The consideration has been paid under the agreement dated 24.4.1979.

(Rupees One Lakh only) paid shall be refunded to the PURCHASERS by the VENDOR:

IN WITNESS where of the parties have set their hands the day and the year first above mentioned.

23. In view of the agreement and the admission made by the plaintiffs, we are of the opinion that it would be appropriate to modify the decree passed by the courts below to the extent of 50 per cent of the shares of the deceased late K. Basavaraja Urs and to set it aside with respect to the remaining ½ share of K.B. Ramchandra Raj Urs (defendant No.1) in the property, since the property devolved under section 15 of the Hindu Succession Act.

24. Thus, we hold that the plaintiffs to be entitled only to the extent of ½ share in the suit property. The decree to the remaining extent is set aside. The plaintiffs would not be entitled to refund of any consideration as by now the worth of property has increased manifold.

25. We direct the trial court to divide the property in two equal proportions and it be given to the parties. Let the division be carried 15 out within four months by the Trial Court. The appeals are allowed to the extent mentioned above. No costs.

OCTOBER 24, 2019.