Basavaraj Versus Padmavathi & Anr.
Basavaraj Versus Padmavathi & Anr.
Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 8962-8963 OF 2022
(@ SPECIAL LEAVE PETITION (C) NOS. 6122-6123 OF 2022)
Basavaraj ...Appellant(S)
Versus
Padmavathi & Anr. ...Respondent(S)
J U D G M E N T
M. R. Shah, J.
1. Feeling aggrieved and dissatisfied with impugned
judgment(s) and order(s) dated 27.11.2020 and
06.12.2021 passed by the High Court of Karnataka at
Kalaburagi Bench in Regular First Appeal (RFA) No.
5033/2011 and Review Petition (RP) No. 200036/2021
respectively, by which, the High Court has allowed the said
appeal preferred by respondents herein – original
defendants and has quashed and set aside the judgment
and decree passed by the learned Trial Court decreeing the
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suit for specific performance, the original plaintiff has
preferred the present appeals.
2. The facts leading to the present appeals in a nutshell are
as under: -
2.1 That respondent No. 1 herein – original defendant No. 1
executed an agreement to sell dated 13.03.2007 in favour
of the appellant herein – original plaintiff – buyer agreeing
to sell the land in question on or before 31.07.2007 for a
sale consideration of Rs. 12,74,000/-. Rs. 3 lakhs were
paid as earnest money. The receipt was issued by
respondent No. 1 for the same. That thereafter, as
respondent No. 1 – seller did not execute the sale deed, the
appellant got issued a legal notice dated 20.11.2007
asking the respondent(s) to receive the balance sale
consideration and execute the sale deed. The seller replied
to the legal notice vide reply dated 03.12.2007 denying the
execution of agreement to sell. That thereafter, the
appellant – buyer filed the suit for specific performance on
14.02.2008 vide O.S. No. 17/2008. The original
defendants – sellers filed their written statement and
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opposed the suit. The defendants denied the execution of
agreement to sell. It was also the case of the defendants in
the written statement that the plaintiff was not ready to
perform his part of the contract. Therefore, the defendants
denied readiness and willingness on the part of the
plaintiff – buyer to perform his part of the contract.
2.2 Both the parties led evidence before the Trial Court. The
plaintiff led evidence by examining witnesses, on his
readiness and willingness to perform his part of the
contract. It was brought on record that plaintiff went with
cash to the seller but the seller did not accept the same.
That thereafter, on appreciation of evidence the learned
Trial Court decreed the suit for specific performance vide
judgment and decree dated 30.09.2011. The learned Trial
Court believed the case of the plaintiff – buyer as to the
execution of agreement to sell. The learned Trial Court also
believed the plaintiff’s case as to the payment of earnest
money of Rs. 3 lakhs to the seller. The learned Trial Court
also held that the plaintiff – buyer was ready and willing to
perform his part of the contract. That pursuant to the
3
judgment and decree passed by the learned Trial Court,
the buyer – original plaintiff deposited an amount of Rs.
9,74,000/- before the learned Trial Court which is still
reported to be lying with the Trial Court.
2.3 Feeling aggrieved and dissatisfied with the judgment and
decree passed by the learned Trial Court, respondents
herein – sellers preferred the appeal before the High Court.
By the impugned judgment and order the High Court has
allowed the said appeal and has set aside the judgment
and decree passed by the learned Trial Court, mainly on
the ground that the plaintiff was not ready and willing to
perform his part of the contract. The impugned judgment
and order passed by the High Court is the subject matter
of present appeals.
2.4 The appellant also filed a review petition which came to be
dismissed by the High Court, and the judgment passed in
the review petition is also the subject matter of one of the
appeals.
4
3. Shri K. Parmeshwar, learned counsel appearing on behalf
of the appellant has vehemently submitted that in the facts
and circumstances of the case, the Hon’ble High Court has
materially erred in reversing the findings of the Trial Court
on readiness and willingness of the appellant.
3.1 It is submitted that on appreciation of entire evidence on
record the learned Trial Court recorded findings as to
readiness and willingness of the appellant, in favour of the
appellant, and such findings were not required to be
interfered with by the High Court.
3.2 It is further submitted that all through, out and right from
the very beginning, the appellant – buyer was ready and
willing to perform his part of the contract. He has prayed
that the following aspects emerging from the evidence on
record be considered, while considering the issue as to
readiness and willingness on the part of the appellant to
perform his part of the agreement dated 13.03.2007: -
5
(i) That the appellant specifically averred in the plaint
that he is ready and willing to perform the agreement
dated 13.03.2007;
(ii) That in the suit notice dated 20.11.2007 the plaintiff
specifically averred that he is ready and willing to pay
the balance sale consideration;
(iii) The plaintiff in his evidence stated that he is ready
and willing to perform the agreement. In the
deposition it was further stated that he approached
the defendant – seller in the month of June, 2007
and again in July, 2007 with the balance sale
consideration. That there is no cross-examination in
this regard;
(iv) The plaintiff examined PW2 and PW3, the attestors to
the agreement to sell, who specifically stated that in
June, 2007, the plaintiff approached the defendants
and asked them to take the balance sale
consideration in cash. That there is no crossexamination in this regard;
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(v) That the DW-1 – first defendant admitted in her
cross-examination that she executed the agreement
and that she was the owner of the said property;
(vi) That she had affixed her signatures on the agreement
and that she received Rs. 3 lakhs;
(vii) That the appellant had deposited the balance
consideration of Rs. 9,74,000/- before the learned
Trial Court on 31.10.2011.
3.3 Learned counsel appearing on behalf of the appellant –
buyer has further submitted that as such the defendant
took a dishonest stand before the learned Trial Court and
denied the execution of the agreement. It is further
submitted that in the written statement, the specific stand
taken by the defendants was that no agreement to sell was
executed between the parties. It is contended that
however, defendant No. 1 subsequently admitted that Rs.
3 lakhs were received by her, and a receipt dated
13.03.2007 was issued in that regard.
3.4 It is further contended that even the seller – defendant No.
1 took contradictory and dishonest pleas. She initially
7
denied the execution of the agreement, then denied that it
was an agreement to sell but only an agreement in respect
of a loan transaction.
3.5 It is next contended by learned counsel appearing on
behalf of the appellant that as such there are concurrent
findings recorded by the learned Trial Court as well as the
High Court on execution of the agreement to sell by
defendant No. 1 and to the effect that Rs. 3 lakhs were
paid by the buyer by way of earnest money and that the
agreement to sell was not in respect of security and/or a
loan transaction but it was for an outright sale.
3.6 Learned counsel appearing on behalf of the appellant has
heavily relied upon the decision of this Court in the case of
Indira Kaur and Ors. Vs. Sheo Lal Kapoor; (1988) 2 SCC
488 (para 8, 9 and 10) and the subsequent decision of this
Court in the case of Beemaneni Maha Lakshmi Vs.
Gangumalla Appa Rao; (2019) 6 SCC 233 (para 14) on
the aspect of readiness and willingness on the part of the
buyer. It is submitted that in the case of Indira Kaur
(supra) it was held that no adverse inference can be drawn
8
against the plaintiff as to whether he had the means to pay
the balance consideration on the grounds of nonproduction of passbook, accounts or other documentary
evidence.
3.7 It is submitted that in the case of Beemaneni Maha
Lakshmi (supra) it was observed and held by this Court
that failure on the part of the vendee to “demonstrate” that
he was having sufficient money with him to pay the
balance sale consideration by the date of his evidence is
not of much of consequence.
3.8 It is further submitted that in the case of Ramrati Kuer
Vs. Dwarika Prasad Singh; (1967) 1 SCR 153 (para 9), it
was observed and held by this Court that in the absence of
a specific prayer asking for the party to produce accounts
and their subsequent failure to do so, no adverse inference
could be drawn.
3.9 Making the above submissions and relying upon the aforecited decisions, it is submitted that the High Court has
materially erred in reversing the findings of the Trial Court
9
on readiness and willingness on the part of appellant.
Therefore, it is prayed that the present appeals be allowed
and the impugned judgments bet set aside.
4. Present appeals are vehemently opposed by Shri Shailesh
Madiyal, learned counsel appearing on behalf of the seller -
respondents – original defendants.
4.1 Learned counsel appearing on behalf of the respondents –
seller submitted that cogent reasons have been assigned
by the High Court while reversing the judgment and decree
passed by the learned Trial Court and reversing the
findings as to the readiness and willingness on the part of
the appellant.
4.2 It is further submitted that the appellant – original plaintiff
has not demonstrated and/or led any evidence that he had
sufficient means/funds/cash to pay the balance sale
consideration. It is submitted that in absence of such
evidence the High Court has rightly held that the buyer –
original plaintiff has failed to establish and prove readiness
10
and willingness on his part to perform the agreement
dated 13.03.2007.
4.3 It is submitted that in the written statement itself it was
the specific case on behalf of the defendants that the
plaintiff was not ready and willing to perform his part of
the agreement.
4.4 Learned counsel appearing on behalf of respondents –
original defendants, has relied upon the decision of this
Court in the case of J.P. Builders and Anr. Vs. A.
Ramadas and Anr.; (2011) 1 SCC 429 as well as the
recent decision of this Court in the case of U.N.
Krishnamurthy Vs. A.M. Krishnamurthy; 2022 SCC
OnLine SC 840 in support of his prayer to dismiss the
present appeals.
5. We have heard learned counsel appearing on behalf of the
respective parties at length.
6. At the outset, it is required to be noted that the learned
Trial Court, on appreciation of evidence on record,
specifically recorded findings on readiness and willingness
11
on the part of the plaintiff to perform his part of the
agreement. The findings recorded on readiness and
willingness on the part of the plaintiff were on appreciation
of the entire evidence on record. In the legal notice which
was issued on 20.11.2007, the plaintiff asked the
defendant to receive the balance amount and execute the
sale deed. In reply to the legal notice, the defendant denied
the execution of agreement to sell itself. That thereafter,
the plaintiff filed the suit for specific performance in which
it was specifically averred that he was ready and willing to
perform the agreement dated 13.03.2007. In his
deposition, the plaintiff specifically stated that he was
ready and willing to perform his obligations under the
agreement. He further stated that he approached the
defendant in the month of June, 2007 and again in July,
2007 with the balance sale consideration. There is no
cross-examination in this regard. The plaintiff also
examined two witnesses, PW-2 and PW-3, who were
attestors to agreement to sell dated 13.03.2007, who
specifically stated that in July, 2007, the plaintiff
approached the defendants and asked them to accept the
12
balance sale consideration in cash, to that also there is no
cross-examination. The receipt of Rs. 3 lakhs by way of
earnest money, has been held to be proved by both the
courts below. Within a period of one month from passing of
the decree, the plaintiff deposited the balance sale
consideration i.e., Rs. 9,74,000/- before the learned Trial
Court. Considering the aforesaid facts and circumstances
of the case, it is observed that the High Court has
materially erred in reversing the decree by reversing the
findings of the Trial Court on readiness and willingness of
the appellant.
6.1 From the impugned judgment and order passed by the
High Court, it appears that the reasoning given by the
High Court is that the plaintiff has not proved that he had
the cash and/or amount and/or sufficient funds/means to
pay the balance sale consideration, as no passbook and/or
bank accounts was produced. In the case of Ramrati Kuer
(supra) which has been specifically considered by this
Court in the case of Indira Kaur (supra), it was observed
and held as under: -
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“Fourthly, it is urged that the respondents did not
produce any accounts even though their case was that
accounts were maintained and that Basekhi Singh
used to give maintenance allowance to the widows who
were messing separately. It is urged that adverse
inference should be drawn from the fact accounts were
not produced by the respondents and that if they had
been produced that would have shown payment not of
maintenance allowance but of half share of the income
to the widows by virtue of their right to the property.
Itis true that Dwarika Prasad Singh said that his
father used to keep accounts. But no attempt was
made on behalf of the appellant to ask the court to
order Dwarika Prasad Singh to produce the accounts.
An adverse inference could only have been drawn
against the plaintiffs-respondents if the appellant had
asked the court to order them to produce accounts
and they had failed to produce them after admitting
that Basekhi Singh used to keep accounts. But no
such prayer was made to the court, and in the
circumstances no adverse inference could be drawn
from the non-production of accounts. But it is urged
that even so the accounts would have been the best
evidence to show that maintenance was being given to
the widows and the best evidence was withheld by the
plaintiffs and only oral evidence was produced to the
effect that the widows were being given maintenance
by Basekhi Singh. Even if it be that accounts would be
the best evidence of payment of maintenance and they
had been withheld, all that one can say is that the oral
evidence that maintenance was being given to widows
may not be acceptable; but no adverse inference can
be drawn (in the absence of any prayer by the
appellant that accounts be produced) that if they had
been produced they would have shown that income
was divided half and half in accordance with the title
claimed by the appellant.”
6.2 In the case of Indira Kaur (supra) this Court after
considering the observations made by this Court in the
case of Ramrati Kuer (supra) has set aside the findings
recorded by three courts below whereby an adverse
14
inference had been drawn against the plaintiff therein for
not producing the passbook and thereby holding that the
plaintiff was not ready and willing to perform his part of
the agreement. It is observed and held that unless the
plaintiff was called upon to produce the passbook either by
the defendant or, the Court orders him to do so, no
adverse inference can be drawn.
6.3 Applying the law laid down by this Court in the aforesaid
two cases to the facts of the case on hand, no adverse
inference could have been drawn by the High Court. The
High Court seriously erred in reversing the findings
recorded by the learned Trial Court on the readiness and
willingness of the appellant.
7. Considering the circumstances narrated hereinabove, we
are of the opinion that the High Court has materially erred
in quashing and setting aside the judgment and decree
passed by the learned Trial Court by reversing the findings
on the readiness and willingness of the appellant. Under
the circumstances, the impugned judgment(s) and order(s)
passed by the High Court is/are held to be unsustainable
15
and the same deserve to be quashed and set aside.
However, at the same time, to do the complete justice, we
are of the opinion that if the plaintiff is directed to pay a
further sum of Rs. 10 lakhs towards sale consideration, it
will meet the ends of justice.
8. In view of the above discussion and for the reasons stated
above, the present appeals succeed. Impugned judgment(s)
and order(s) passed by the High Court are hereby quashed
and set aside. The judgment and decree passed by the
learned Trial Court for specific performance of the
agreement to sell dated 13.03.2007 is hereby restored.
However, to do complete justice, we direct the plaintiff to
pay to defendant No. 1 a further sum of Rs. 10 lakhs to be
deposited within a period of eight weeks from today and on
such payment, defendant No. 1 is directed to execute the
sale deed in favour of the original plaintiff – appellant
within a period of two weeks therefrom. Defendant No. 1
shall also be permitted to withdraw the amount i.e., Rs.
9,74,000/- deposited by the plaintiff on 31.10.2011,
pursuant to the judgment and decree passed by the
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learned Trial Court, with the interest accrued thereon,
which shall be paid to defendant No. 1 by an account
payee cheque. Present appeals are accordingly allowed
with the above further directions. No order as to costs.
…………………………………J.
(M. R. SHAH)
…………………………………J.
(B.V. NAGARATHNA)
NEW DELHI,
JANUARY 05, 2023.
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