Kishore S/O Jumma Tudlat vs Brijlal S/O Shiolal Jaiswal on 9 September, 1989

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Bombay High Court
Kishore S/O Jumma Tudlat vs Brijlal S/O Shiolal Jaiswal on 9 September, 1989
Equivalent citations: 1990 (2) BomCR 214, (1989) 91 BOMLR 918
Author: D Moharir
Bench: V Mohta, D Moharir

JUDGMENT

D.J. Moharir, J.

1. This is a plaintiff’s appeal against the judgment and decree of the Civil Judge, Senior Division, Yavatmal dismissing his suit for specific performance of an agreement of sale of house property. Parties are both residents of Pusad, Tahsil Pusad, District Yavatmal. The house property in question belongs to the respondent. According to the plaintiff, he came to know that the defendant had put the said house property to sale, and therefore, made an offer to purchase the same. An Agreement of sale was accordingly made on 8-10-1984. The plaintiff agreed to purchase the house property for a consideration of Rs. 60,000/- out of which he paid Rs. 30,000/- on the date of agreement of sale itself. The sale deed was to be executed on 7-10-1985 in time. The plaintiff, therefore, sent a notice dated 12-9-1985 to the defendant reminding him of the agreement of sale and accordingly calling upon him to remain present in the office of the said Registrar at Pusad on 7-10-1985. To this notice, the defendant sent a reply dated 5-10-1985 denying that he had entered into any such agreement and clarified that the transaction between the parties was really one of a loan of which he was in need at that time. The house property was actually worth Rs. 2,00,000/-. It had been fetching rental income of Rs. 2,000/- per month. The defendant had taken only a loan of Rs. 10,000/- on that day and had gone on paying interest upto 8-10-1984 and on 3-9-1985 he had also paid to entire amount of Rs. 10,000/-, with interest due thereon. However, on the pursuation of the plaintiff he had not insisted upon obtaining the receipt of discharge.

2. In view of that reply, plaintiff instituted the present suit on 30-11-1985 alleging that he had agreed to purchase and the defendant agreed to sell the house property at Pusad of a consideration of Rs. 60,000/-, and further alleging that he had also paid 30,000/- by way of earnest at the date of agreement of sale itself, he claims to be ready and willing, as he had always been, to perform his part of the agreement of sale. He therefore, prayed for a decree for specific performance and in the alternative refund of Rs. 30,000/- together with Rs. 5,000/- as compensation as was already agreed under the Agreement of Sale dated 8-10-1985 . He stated that the defendant was not ready and willing to perform his part of agreement, committed a breach thereof, inasmuch as he failed to present himself at the office of the Sub-Registrar on 7-10-1985 inspite of the plaintiff’s notice dated 12-9-1985 and in which he had raised a dispute. In his written statement at Ex. 14, the defendant raised substantially the same contentions which form his reply at Ex. 42, dated 5-10-1985 to the plaintiff’s notice dated 12-9-1985. The trial Court thus, therefore, framed issues on these pleadings of the parties and came to the conclusion that the agreement of sale as such had not been proved by the plaintiff, nor had he proved the payment of Rs. 30,000/- as earnest. The trial Court accepted the defendant’s case that he had borrowed Rs. 10,000/- from the plaintiff and that the Agreement of Sale was a sham and bogus one, evidencing only the transaction of loan, which he further held that the document was not to be given effect to. The plaintiff was not, therefore, entitled either to the specific performance, or to the refund of the so-called earnest money of Rs. 30,000/-. The suit was thus dismissed and hence the appeal by the aggrieved plaintiff.

3. Learned Counsel Shri Choudhary appearing for the plaintiff argues in the first instance and of course it is also not disputed that the defendant is the owner of the house property in suit and has also not disputed the formal execution of the agreement of sale dated 8-10-1984 at Ex. 21. He also points out that the defendant had also not disputed the fact of receipt of a sum of Rs. 10,000/- at least on that date, in pursuance of that agreement of sale. Therefore, according to him, the burden in substance lies on the defendant to prove that the transaction was not what was recited in the document Ex. 21, but that it was merely a document evidencing a transaction of loan between the parties. Substantially, therefore, it will be for the defendant to show that the transaction evidenced something else than what was agreed upon as per recitals in the document Ex. 21. Shri Madkholkar the learned Counsel for the respondent in the circumstances submits at the first instance that the respondent could not have entered into the transaction of sale of the house property because it did not belong exclusively to him, but was a joint family property in which there were other shares. It be noted that in the agreement of sale Ex. 21, the recital is that the property belongs exclusively to the defendant. Secondly, in reply at Ex. 42 sent to the plaintiff’s notice dated 12-9-1985 also the defendant did not plead that the house property belonged not exclusively to the defendant and that he was only one of the shares and could not have, for that reason entered into the agreement of sale. However, no evidence whatsoever is forthcoming on the point of the defendant and some others being the owners of the property. On the other hand, the extract of the Municipal Assessment List at Ex. 47 shows the name of the defendant alone as the owners of the suit property.

4. Shri Madkholkar also argued that it was because the plaintiff had only lent money to the defendant, that he did not bother about getting the property duly valued, which he would have ordinarily done if the transaction was a genuine one of agreement of sale. What could possibly have been done would not necessarily be something which ought to have been done or must have been done for the purpose of a genuine transaction of purchase and sale of the property between the plaintiff and the defendant. It is also argued that the plaintiff would also have got the property inspected and examined by a qualified Engineer to assess its true value which the plaintiff had not done at that time. This is also a matter of discretion entirely of the plaintiff and not a prerequisite to entering into the agreement of sale.

5. The next submission of Shri Madkholkar is that, it must appear rather strange that out of the agreed consideration of Rs. 60,000/- substantially a portion of 50% or half of it had come to be paid to the defendant, as per the agreement of sale. That is also not something upon which the genuineness or the otherwise of transaction must, by itself be determinable. It may also be noted that according to the defendant, the house property was actually worth Rs. 2,00,000/- and he could not have, therefore, agreed to sell if at Rs. 60,000/-. The plaintiff had denied that such was its value and for proving the same, the defendant has examined one Mr. Vyas (P.W. 3) who was not an expert valuer but was for some time a Junior Engineer in the Irrigation Department and holding merely a Diploma in Civil Engineering as his qualification. Vyas’s evidence very clearly shows that his report Ex. 49 about the valuation of the property is as bogus and worthless as one can be. While the defendant himself says that Vyas had never been to his house to inspect and examine the house property, with a view to determine its value, it is only Vyas who claims to have done so in the presence of the defendant himself. Vyas has also admitted as is stated by the defendant that no remuneration whatsoever was paid to him for this purpose. Lastly, the valuation of Rs. 2,00,000/- had been arrived at, as Vyas admits on the basis of the price of house and properties prevailing in the year 1985-86 whereas the transaction in this case had taken place in October 1984. Therefore, the contention about the value being too high, and therefore, the obvious unlikelihood of the defendant agreeing to sale to the property for Rs. 60,000/- only is a contention which must also fall to the ground. For showing that the transaction was not of the transfer as evidenced by the document Ex. 21 but was really one of a loan of Rs. 10,000/- given to the defendant by the plaintiff, the defendant has absolutely to evidence. Whatever could be called as evidence would have to be summarised as being entirely unacceptable. According to the defendant, the plaintiff is a professional money lender. That has not been suggested to him in the first instance. In his deposition, the plaintiff has given his occupation as being in private service, under the Municipal Council. Plaintiff has also stated that it is his family which is in business. He states that he entered into the transaction for purchase of the house property for the reason that the family house fell insufficient to meet the requirement of the large number of members in the family. What exactly was the need of the defendant, urgent also as he describes, it, for taking a loan is not explained by the defendant, nor is it shown, by any other evidence that the plaintiff is a professional money lender. During his deposition, the defendant mentioned two persons viz. Sk. Rahim Sk. Iman and Shaukat Khan as persons to whom money had been lent by the plaintiff. The suggestion in that behalf came to be denied emphatically by the plaintiff and even so these two persons viz. Sk Rahim Sk Iman and Shaukatkhan were not examined. Secondly, the defendant himself stated that prior to the transaction under the document Ex. 21 he had taken loans on two occasions of which also there was no evidence. He only baldly states, in respect of one of these transactions that the document executed by him to evidence the loan given to him, had been returned him upon repayment of the amount and that he had simply torn it out. This is also not acceptable as convincing. The amount of Rs. 10,000/- was required by the defendant, as he explains a little latter, for giving that amount to his brother-in-law. This brother-in-law is again not a person examined as his witness.

6. In support of the plea that he had only taken a loan of Rs. 10,000/-, the defendant had further contended that he had gone on paying Rs. 200/- per month by way of interest and then on 3-9-1985 he had actually paid the entire amount then due, the principal of Rs. 10,000/- and interest Rs. 2,000/-. To evidence even a single one of any such repayments, the defendant does not have any receipt passed to him by the plaintiff. In fact he admits that he did not obtain any receipt and makes only a self satisfying explanation that the plaintiff asked him to have faith in him and not to insist upon receipts. Again, for proving that the transaction was one of a loan, no other witness is examined by him. In fact, he himself admits that at the time when he executed the document (Ex. 21) in favour of plaintiff there was no other person present, except the two of them. Therefore, about the character of the transaction as being one of the loan and of any repayment made towards the loan, there is no evidence.

7. On the other hand, during the cross-examination of the defendant himself, material comes on record which suggests the greater possibility of his being in need of money and therefore deciding to sell away the house property. In the first place, the suit property is not the only one which he possesses. There are two more houses which he appears to own at Pusad. Then, he had also admitted that municipal taxes on the house property had been due and outstanding since 1982 which supports the inference, a very plausible and reasonable one, that he had therefore, decided to sell the property for paying out the arrears of taxes.

8. One more contention for showing the house property as being worth much more than Rs. 60,000/- which the defendant had stated is that the house property had been let out by him to one Shankar Thakur on a monthly rent of Rs. 2,000/-. Of such receipt of rent at Rs. 2,000/- per month, he admits that there is no evidence. He never passed any receipts to Shankar Thakur and Shankar Thakur himself is also not examined as a witness. There is no agreement of tenancy between the defendant and Shankar and what is more important, even assuming for a moment that Rs. 2,000/- were being paid to him by Shankar Thakur for the premises, is the admission of the defendant that the said Shankar Thakur had come to be prosecuted under sections 4 and 5 of the Bombay Prevention of Gambling Act for running a gambling den there. For such an illegal purpose if Shankar Thakur were to have agreed to pay Rs. 2,000/- per month to the defendant, then that amount would not represent the true rental value on the basis of which to calculate and determine the actual selling value and the valuation of the property. In the circumstances, none of the contentions advanced by the defendant, to meet and ward off the liability to execute a sale deed in favour of the plaintiff as agreed under Ex. 21, can be said to have been established, and therefore the reasoning adopted by the learned Judge of the trial Court that the agreement of sale itself was not proved, that it was at best a transaction of loan between the parties, cannot be sustained.

9. The plaintiff must, in the circumstances, succeed. The plaintiff had claimed as per the plaint allegations, a decree of specific performance in the first instance and alternatively, if for any reason the same could not be granted, a decree for refund of the amount of Rs. 30,000/- which he had paid by way of earnest at the time of the agreement of sale dated 8-10-1984. At the hearing, having regard to the fact that the house property has obviously come to be used for nefarious purpose, the plaintiff does not insist upon a decree for specific purpose as such, but only a decree for refund of the amount of Rs. 30,000/- which in the circumstances would have to be granted.

10. The appeal, therefore, succeeds and hence the order. The appeal is hereby allowed. The judgment and decree passed by the trial Court, dismissing the plaintiff’s suit in its entirety is hereby set aside. The appellant/plaintiff is granted a money decree for refund of Rs. 30,000/- as refundable by the respondent defendant, being the earnest money. On this amount of Rs. 30,000/- the respondent/defendant shall pay interest at Rs. 9% per annum from the date of agreement of sale (8-10-1984) up to the date of the suit (30-11-1985) and then interest thereon at 6% per annum from the date of suit till realisation of the amount. The respondent defendant shall bear his own costs of the suit throughout and pay those of the appellant plaintiff proportionate to his success. The appellant’s claim for refund of Rs. 5,000/- by way of damages, in addition to claim for refund of Rs. 30,000/- as the earnest money, shall, however, stand dismissed. Decree be accordingly.

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