REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 3415 of 2019 (arising out of S.L.P. (C) No. 35553 OF 2016)

DR. MANOHAR GANAPATHI RAVANKAR  ........APPELLANT  

             Versus

H. GURUNANDA RAIKAR                        ........RESPONDENT

WITH  

CIVIL APPEAL NO. 3416 of 2019 (arising out of S.L.P.(C) No. 3062 OF 2017)

H. GURUNANDA RAIKAR                        ........APPELLANT

Versus

DR. MANOHAR GANAPATHI RAVANKAR  ........RESPONDANT

J U D G M E N T

Hemant Gupta, J.

Civil  Appeal  No.  3415  of  2019  is  by  the  Plaintiff  aggrieved

against the judgment and order dated 17.02.2016 passed by the High

Court  of  Karnataka  at  Bengaluru  declining  relief  for  specific

performance of the agreement of sale of the schedule property but

granting a decree for recovery of Rs. 7,01,000/- along with interest at 1

the rate of 12 per cent per annum from the date of payment till date

of  realisation.   Civil  Appeal  No.  3416 of  2019 is  by the Defendant

aggrieved against the decree for payment of Rs. 6,75,000/- by the

same judgment.   

2. Hereinafter for facility of reference, the parties will be described

as per their status before the trial court.  The Defendant is the owner

of non-agricultural immovable property situated in Kadri Village, Kadri

Ward,  Mangalore  Taluk,  within  the  Mangalore  City  Corporation  and

comprised  in  Rs.  No.  72-11,  bearing  T.S.  No.  1578-11G measuring

7.25 cents or 0.0725 acre with residential buildings bearing Door No.

3-3-2429,  3-30-2430,  shop  premises  bearing  Door  No.  3-30-2431,

which is more particularly described in the schedule to the plaint and

hereinafter referred to as “the schedule property”.

3. The case of the Plaintiff is that on 21.07.2006, the Defendant

entered into a written agreement with him for sale of the schedule

property for a total sale consideration of Rs. 30,00,000/-.  A sum of Rs.

26,000/- was paid as earnest money. At the time of agreement, the

Defendant has a civil dispute (OS No. 196/2005) pending against him

filed  by  his  brother.  The  condition  in  the  agreement  was  that  the

Defendant  will  settle  the  pending  dispute  within  a  period  of  six

months. But if the dispute is not resolved within six months, the time

for the execution of the sale deed shall be extended by such time as

mutually to be agreed upon by the parties. Some of the terms of the

agreement read as under:  

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“1. That the 2nd PARTY PURCHASER has agreed to pay a total sale consideration of Rs.30, 00, 000/- (Rupees  Thirty  Lakhs  Only)  towards  the  agreed sale of schedule property by the 1st PARTY VENDOR to the 2nd PARTY PURCHASER and out of above sale consideration, the 2nd PARTY PURCHASER has paid a  sum  of  Rs.  26,  000/-  (Rupees  Twenty-Six Thousand  Only)  to  the  1st PARTY  VENDOR  by means  of  cheque dated  21.07-2006  bearing  No. 918333  drawn  on  Syndicate  Bank,  Fr.  Muller’s Charitable Institution Branch, Mangalore, by way of advance sale consideration,  the receipt  of  which the 1st PARTY VENDOR hereby acknowledges.  The balance  sale  consideration  of  Rs.  29,74,000/- (Rupees  Twenty  Nine  Lakhs  Seventy  Four Thousand only) is agreed to be paid at the time of execution  and  registration  of  the  intended  Sale Deed.

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5. The 1st PARTY VENDOR shall execute the Sale Deed within 6 months (Six Months) from the date of execution of this Agreement, which however can be altered only by mutual consent in writing and signed by both the parties.

6. In case, the 1st PARTY VENDOR fails to perform his  part  of  this  agreement,  he  shall  refund  the entire advance sale consideration of Rs. 26,000/- (Rupees  Twenty  Six  Thousand  Only)  along  with interest at 12% per annum and in addition to that he  shall  also  pay  a  further  sum  of  Rs.  5,000/- (Rupees  Five  Thousand  Only)  by  way  of  pre- estimated liquidated damages and accordingly in such  event,  the  2nd PARTY  PURCHASER  shall  be entitled to recover the said amounts from the 1st PARTY VENDOR, including the interest and cost if any incurred, for recovery of the same.”  

4. The Plaintiff served a notice on 25.12.2006 raising a grievance

that the Defendant has not informed him about the position of the

civil  suit  but  as  per  his  information,  dispute  in  the  family  stands

settled.  It was stated in the notice that he is ready with balance sale

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consideration of Rs. 29,74,000/-.  The relevant extract from the notice

is as under:  

“I have kept the balance sale consideration Rs.29, 74, 000/- ready and you can execute the sale deed at  any  time  and  to  receive  the  balance  sale consideration without seeking any further time and to  hand  over  the  actual  physical  possession.   I request you to go through the accompanying draft sale deed which is sent for approval and request you to furnish upto date encumbrance certificate, taxes  paid  receipt,  electricity  and  water consumption bill paid receipts so as to execute the sale  deed  within  this  week  i.e.  on  or  before 31.12.2006.”

5. The  Plaintiff  later  filed  a  suit  OS  No.  350/2007  on  or  about

10.12.2007  praying  for  the  relief  of  specific  performance  of  the

agreement dated 21.07.2006. In the plaint, the Plaintiff pleaded that

Defendant  has  demanded  and  received  a  further  sum  of  Rs.

6,75,000/-. However, no date of such payment of said amount was

disclosed in the plaint.   

6. The  Plaintiff  filed  an  affidavit  of  Chief  Examination  on

21.01.2010,  but  again  there  is  no  mention  of  payment  of  Rs.

6,75,000/-.   However,  on 18.12.2010 another affidavit  was filed by

way of an Additional Chief Examination to the effect that sum of Rs.

6,75,000/- was paid but without disclosing any date of payment.  It

may be noted at this stage that in the agreement, the parties have

agreed  to  extend  the  time  by  mutual  consent  but  there  is  no

endorsement  either  on  the  agreement  in  question  or  by  way  of

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written note separately except, the assertion by the Plaintiff in the

plaint that he has paid sum of Rs. 6,75,000/-  

7. The learned trial court on 17.09.2012 decreed the suit granting

decree  of  the  specific  performance  of  agreement  of  sale  dated

21.07.2006  for  a  consideration  of  Rs.  30,00,000/-,  and  to  get

Registered  Sale  Deed  executed  by  paying  the  balance  sale

consideration  amount  of  Rs.  29,74,000/-.  It  is  the  Defendant  who

preferred appeal against the decree granted in which, the High Court

has passed an order of refund of Rs. 7,01,000/- while declining the

relief of specific performance of the agreement.  

8. The High Court  inter  alia  held that  the Plaintiff  has failed  to

prove  that  he  was  ready  and  willing  to  perform  his  part  of  the

agreement.   The  High  Court  further  held  that  there  is  nothing  on

record to show that as to when and how payment of Rs. 6,75,000/-

was made out  of  balance sale  consideration.  The High Court  then

observed that it may be a loan transaction as the original title deeds

were handed over to the Plaintiff. Thus, the Court granted a decree for

recovery  of  Rs.  7,01,000/-  for  the  reason  that  another  sum of  Rs.

6,75,000/- must have been paid at the time when the original title

deed was handed over to the Plaintiff.  

9. We find that the High Court erred in law in granting a decree for

payment of Rs. 7,01 000/- more so when the High Court has returned

a finding that the Plaintiff was not ready and willing to execute the

contract merely on the basis that original title deeds might have been

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handed over to the Plaintiff when sum of Rs. 6,75,000/- is said to have

been paid by the Plaintiff.  

10. Though  in  the  additional  affidavit  of  Additional  Chief

Examination,  the  Plaintiff  asserted  that  original  title  deeds  were

handed over when he paid a sum of Rs. 6,75,000/- but in the plaint,

there is no such averment.  In fact, the Plaintiff has filed earlier suit

for  injunction  which  was  not  pursued  to  file  the  suit  for  specific

performance.  The Plaintiff has averred to the following effect in the

present suit for specific performance:

“2.    After the plaintiff having entered into the contract  for  the  sale  of  the  plaint  ‘A  Schedule property,  the  defendant  used  to  demand  and collect  money from the plaintiff and the plaintiff having paid in good faith and the defendant had received in all Rs 6,75,000/- from the plaintiff out of  the  balance  sale  consideration  of  Rs. 29,74,000/- and had handed over the original title documents  relating  to  the  plaint  ‘A’  Schedule property. The plaintiff was and is ready and willing to  perform  his  part  of  contract,  i.e.  to  pay  the balance sale consideration and get the registration of the sale deed in his favour. By letter dtd. 25-12- 2006,  the  plaintiff  had  even  conveyed  his readiness and willingness to register the sale deed by paying the balance sale consideration and sent draft sale deed. The defendant received the said notice  without  demur.  The  defendant  though showed his willingness to execute the sale deed expressed  his  in  ability  to  settle  the  pending litigation  with  his  brother.  As  such  the  plaintiff even approached the brother of the plaintiff so as to have a amicable settlement between them. In furtherance  of  the  said  contract  for  the  sale  of plaint  ‘A Schedule property,  the plaintiff had got measured the property and made arrangement for the  repair  of  the  building  situated  in  the  said property.”

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11. Still  further,  in  the  notice  dated  25.12.2006,  there  is  no

assertion of handing over of the documents of the title or payment of

Rs. 6,75,000/-. In fact, the categorical assertion in the notice served is

that  the  Plaintiff  is  ready  and  willing  to  pay  the  balance  sale

consideration  amount  of  Rs.  29,74,000/-.  There  is  no document  to

prove payment of Rs. 6,75,000/-, except the bald statement of the

Plaintiff.  There is  no any other evidence to prove that  sum of  Rs.

6,75,000/- was paid by the Plaintiff and on which date.  If payment of

earnest money of  Rs.26,000/-  could be made by cheque,  then the

payment of Rs.6,75,000/- in cash is beyond any comprehension.

12. Therefore, the entire story of payment of Rs. 6,75,000/- at the

time of handing over the title documents is wholly unbelievable. The

Plaintiff has not asserted such fact in the plaint or in the notice served

on 25.12.2006. The High Court erred in law in passing a decree for

recovery of the said amount only on the basis of presumptions.   

13. In view of the above, we find that the Plaintiff is not entitled to

decree  for  relief  of  specific  performance,  in  view  of  the  finding

recorded by the High Court itself that he was not ready and willing to

perform his part of the contract.   

14. In  view  of  the  above,  the  appeal  filed  by  the  Plaintiff  is

dismissed  whereas,  that  of  the  Defendant  is  allowed.   Since  the

Plaintiff has admittedly paid a sum of Rs. 26,000/-, we order that the

Defendant  shall  pay such amount to the Plaintiff  to settle  equities

along with simple interest at the rate of 9 per cent per annum from

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the date of payment till the date of realisation.  The appeals stand

disposed of accordingly.  

..………..………...........................J.    (Dr. Dhananjaya Y. Chandrachud)

…….......................................J.   (Hemant Gupta)

New Delhi, April 15, 2019.

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