IN THE PUNJAB AND HARYANA HIGH COURT AT
CHANDIGARH
R.S.A. No. 3898 of 2006 (O&M)
Date of Decision : 15.1.2009
Tarwinder Mohan Singh Bhatia
.......... Appellant
Versus
Amrik Singh & others
...... Respondents
CORAM : HON'BLE MR. JUSTICE VINOD K. SHARMA
Present : Mr. Padam Jain, Advocate
for the appellant.
Mr. Rajbir Wasu, Advocate
for the respondents.
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VINOD K. SHARMA, J. (ORAL)
This regular second appeal is directed against the judgments
and decree dated 20.8.2004 and 19.8.2006 passed by the learned Courts
below vide which decree for recovery of Rs. 3.50 lacs along with interest @
6% per annum, has been passed against appellant.
The plaintiff-respondents claimed that there was an agreement
to sell executed between the parties on 12.3.1999.
The plaintiffs paid a sum of Rs. 3.50 lacs as earnest money out
of the total sale consideration of Rs. 4.00 lacs.
A sum of Rs. 50,000/- was agreed to be paid at the time of
registration of the sale deed.
It was also the case of the plaintiff-respondent that defendant-
R.S.A. No. 3898 of 2006 (O&M) -2-
appellant failed to comply with the terms of the contract as he did not
appear before the Registrar for registration of the sale deed on the date
fixed. The plaintiffs further alleged that they were always and still willing
to perform their part of contract.
The suit was contested, wherein a plea was taken that the
agreement to sell was not intended to be acted upon as in fact it was a loan
transaction between the parties and the agreement to sell was executed as a
security. The defendant-appellant further claimed that in fact loan was
advanced to the appellant in the year 1993 and an agreement to sell Ex. D-1
executed by way of security.
It was further the case of the defendant-appellant that he had
been regularly paying the interest against the loan, however, no proof of
payment was brought on record nor he was able to prove the rate of interest
on which the loan was advanced.
The appellant-defendant also produced on record two other
agreement to sell Ex. D-2 & Ex. D-3 qua the property in dispute.
The learned Courts below recorded a concurrent finding of fact
that Ex. P-3 was not an agreement to sell but merely security for a loan
transaction. The learned Courts in order to come to this conclusion relied
upon the agreements to sell Ex. D-1 to Ex. D-3.
It was held that in fact there was transaction of loan between
the parties.
The decree for specific performance was declined.
R.S.A. No. 3898 of 2006 (O&M) -3-
In view of the fact that loan transaction stood proved between
the parties suit was ordered to be decreed for recovery of Rs. 3.50 lacs along
with interest @ 6% per annum as envisaged under Section 34 of the Code of
Civil Procedure.
The learned counsel for the appellant vehemently contends that
once the learned Courts came to the conclusion that agreement Ex. P-1 was
in fact not an agreement to sell no reliance could be placed thereon.
Initially the loan was only for a sum of Rupees one lac and,
therefore, by applying the principles of “Damu Pat” the interest of more
than the principal could not be awarded.
There is no force in the contention raised by the learned
counsel for the appellant. Once a specific stand was taken by the appellant
that there was a loan transaction between the parties and Ex. P-1 was
security and contents of agreement were not disputed, the amount
mentioned in the agreement was rightly taken to be loan amount. As no rate
of interest was agreed or proved, the learned Courts below rightly decreed
the suit for recovery of Rs. 3.5 lacs with interest @ 6 % per annum, as per
provisions of Section 34 CPC.
The concurrent finding of fact recorded by the learned Courts
below is not open to challenge in this second appeal.
No question of law much less substantial question of law arises
for consideration by this Court.
Dismissed.
15.1.2009 ( VINOD K. SHARMA ) 'sp' JUDGE