SHRI. JAGANNATH S SHETTY vs. THE ADDITIONAL COMMISSIONER OF INCOME TAX

1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 15TH DAY OF MARCH, 2024

BEFORE

THE HON'BLE MR. JUSTICE H.P. SANDESH

R.S.A. NO.771/2018 (SP) BETWEEN:

1 . DR. S. BHEEMAPPA SINCE DEAD BY LRS

1(a) SMT. S.N.CHANDRAMMA

W/O LATE DR. S.BHEEMAPPA

AGED ABOUT 72 YEARS R/AT NO.113, 4TH CROSS ROAD, R.K.LAYOUT, PADMANABHANAGARA BENGALURU-566070.

1(b) SRI S.B.UMESH BABU

S/O LATE DR. S.BHEEMAPPA AGED ABOUT 52 YEARS R/AT NO.113, 4TH CROSS, R.K.LAYOUT, PADMANABHANAGARA BENGALURU-560 070

(AMENDED VIDE COURT ORDER DATED 20.03.2023)

… APPELLANTS (BY SRI C.M.NAGABUSHANA, COUNSEL FOR SRI SRIHARI A.V., ADVOCATE) AND:

1 . SRI. R. ANNADANAPPA S/O T.N. RAMAIAH, AGED ABOUT 49 YEARS R/O THALAGHATTAPURA, R

2 UTTARAHALLI HOBLI, BENGALURU-560 068

2 . SMT. SHARADAMMA W/O N. KRISHNAPPA, AGED ABOUT 64 YEARS R/AT NO.8/9, GNANAJYOTHINAGAR, 9TH MAIN, MALLATHAHALLI VILLAGE, BENGALURU-560 060.

3 . SMT. MUNIRATHNAMMA D/O N. KRISHNAPPA, AGED ABOUT 36 YEARS R/AT NO.8/9, GNANAJYOTHINAGAR, 9TH MAIN, MALLATHAHALLI VILLAGE, BENGALURU-560 060

4 . SRI GURUMURTHY S/O N. KRISHNAPPA, AGED ABOUT 32 YEARS R/AT NO.8/9, GANAJYOTHINAGAR 9TH MAIN, MALLATHAHALLI VILLAGE, BENGALURU-560 060.

… RESPONDENTS

(BY SRI KASHINATH J.D., ADVOCATE FOR R1; SRI A. FEROZE NIZAM, ADVOCATE FOR R2 & R4 [THROUGH VC]; R3 - SERVED, BUT UNREPRESENTED)

THIS R.S.A. IS FILED UNDER SECTION 100 OF CPC., AGAINST THE JUDGMENT AND DECREE DATED 27.2.2018 PASSED IN R.A.NO.39/2014 ON THE FILE OF THE VII ADDL. DISTRICT AND SESSIONS JDUGE, BANGALORE RURAL DISTRICT, BANGALORE, DISMISSING THE APPEAL AND CONFIRMING THE JUDGMENT AND DECREE DATED 21.12.2013 PASSED IN O.S.NO.357/2005 ON THE FILE OF THE I ADDL. SENIOR CIVIL JUDGE, BANGALORE RURAL DISTRICT, BANGALORE.

3 THIS R.S.A. HAVING BEEN HEARD AND RESERVED FOR JUDGMENT ON 01.03.2024 THIS DAY, THE COURT PRONOUNCED THE FOLLOWING:

J U D G M E N T

Heard the learned counsel for the appellant and learned counsels for respondent No.1 and respondent Nos.2 and 4.

4 into writing as per the sale agreement dated 27.11.1999. That the defendant Nos.1 to 4 have agreed to sell the suit schedule property for Rs.4,00,000/- per acre and they have received Rs.6,00,000/- by way of cash as on the date of the agreement. That they have handed over the possession of the suit schedule property on the date of execution of the sale agreement. It is contended that the plaintiff after being inducted into possession of the suit schedule property, has improved the suit schedule property for making it more advantageous for agricultural operations and he was always ready and willing to perform his part of duty towards the contract. However, the defendant Nos.1 to 4 postponed the execution of the sale deed on one of the other pretext. The plaintiff also approached the defendants on 02.09.2004 and made further request for completion of the sale transaction as agreed through the agreement dated 27.11.1999. That on 13.09.2004, plaintiff has issued notice to the defendant Nos.1 to 4 to execute the sale deed by

5 receiving the balance sale consideration. Inspite of receipt of notice, the defendant Nos.1 to 4 have not performed their part of duty towards the contract. That on enquiry in the office of the Sub-Registrar, plaintiff came to know that the defendant Nos.1 to 4 have already executed a registered sale deed in favour of defendant No.5 on 02.04.2004. That taking advantage of the sale deed executed by defendant Nos.1 to 4, the defendant No.5 is trying to interfere with the possession of the plaintiff. The defendant No.5 tried to take possession forcibly on 29.01.2005. However, the illegal of defendant No.5 has been resisted by the plaintiff and he was always ready and willing to perform his part of obligation towards the contract. However, the defendant Nos.1 to 4 have not kept up their promise and executed the sale deed in favour of defendant No.5 and hence, the plaintiff has been constrained to file the suit for specific performance.

8 6. Whether the plaintiff is entitled for the relief of specific performance of contract and permanent injunction as prayed for?

9 the plaintiff, in pursuance of the sale agreement and he was always ready and willing to perform his part of contract and also comes to the conclusion that there is an interference at the instance of defendant No.5. Hence, the plaintiff is entitled for the relief of specific performance of contract and permanent injunction as prayed for. The Trial Court answered additional issue No.1 in ‘negative’ in coming to the conclusion that the suit filed by the plaintiff is not barred by limitation as contended by the defendants.

10 plaintiff had paid Rs.6,00,000/- to his uncle. Though it is alleged that it was an agreement of the year 1999, the plaintiff did not file any suit till the sale deed was executed in favour of defendant No.5. It is contended that Ananda, who is the son of his uncle also signed registered general power of attorney. It is also contended that P.W.1 had clearly admitted 11 photographs, Exs.D1 to D11 and existence of building and also denied the suggestion about electricity connection taken by defendant No.5. But, in the cross-examination, the plaintiff had clearly admitted that Ex.P1 had not been registered which was required to be registered under the Registration Act.

11 agreement is not on behalf of minor son. It is also contended that reasoning adopted in Para No.11 of the judgment is wholly unsustainable, merely because the defendant Nos.1 to 4 have not contested the matter. Though it is admitted by P.W.1 that he has shown payment of Rs.6,00,000/- in his income tax returns, the same was not produced and reasoning adopted in Para No.12 of the judgment is erroneous and the plaintiff has not produced any evidence to show that he was having huge amount of Rs.6,00,000/- at the time of entering into an agreement. The reasoning adopted in Para No.13 goes against the plaintiff, who is a relative of defendant No.1 and he has not come to the Court with clean hands and also not established payment of Rs.6,00,000/- and reasoning given by the Trial Court is against the material on record. It is also contended that the Trial Court committed an error in accepting the document of Ex.P1 and committed error in relying upon the documents of Exs.D12 and D13 holding

12 against defendant No.5, in coming to the conclusion that Ex.D13 is not having any validity and based on the said document, the defendants have not claimed any title and only claimed title on the basis of the sale deed at Ex.D14. It is also contended that the Trial Court unnecessarily referred the agreement of sale preceding the sale deed dated 02.04.2004 which has no relevancy after execution of the sale deed. The validity of the sale deed has not been questioned by the plaintiff and the defendant No.5 is the bonafide purchaser. Hence, the Trial Court committed an error in granting the relief of specific performance.

14 Trial Court has failed to consider that, merely because the defendant Nos.1 to 4 have not filed the written statement, the same does not take away the burden of proof of the alleged agreement, the plaintiff has to prove the due execution of the agreement by the defendant Nos.1 to 4 and passing of consideration to the defendant Nos.1 to 4. In view of non-appearance of the defendant Nos.1 to 4, the burden is heavy upon the plaintiff to prove the execution and passing of consideration. Though, the recital in the agreement refers to passing of consideration of Rs.6,00,000/- to the plaintiff, the plaintiff has not produced any proof to show that he was having a sum of Rs.6,00,000/- as on the date of execution of the agreement and the same has been paid to the defendant Nos.1 to 4.

15 to the defendant Nos.1 to 4. the Trial Court proceeded on the basis that there is no narration about the alleged creation of Ex.P1 in the written statement filed by the defendant No.5. In fact, the defendant No.5 has specifically contended that, the defendant Nos.1 to 4 and the plaintiff belong to the same family, the defendant No.1 and the father of the plaintiff were the brothers and hence, the plaintiff having mediated the sale transaction in favour of the defendant No.5, being aware of the same, in collusion with the defendant Nos.1 to 4, has created the said document. The said averment is available in the written statement filed by the defendant No.5. It is further contended that the Trial Court proceeded on the basis that documents Exs.D12 and D13 are the agreement of sale and the affidavit executed by defendant Nos.1 to 4 in favour of the son of the defendant No.5. These documents have been produced by the defendant No.5 to substantiate the existence of the earlier documents and passing of

16 consideration to the defendant Nos.1 to 4 by the defendant No.5, followed by registered sale deed dated 02.04.2004.

17 the defendant No.5, merges with the sale deed Ex.D14 dated 02.04.2004. There is no suppression of the alleged agreement of sale dated 27.11.1999, the defendant No.5 had examined the encumbrance, title of the defendant Nos.1 to 4, there is nil encumbrance and hence, the defendant No.5 being a bonafide purchaser has exercised his due diligence in getting the sale deed in his favour.

18 conclusion that suit is not barred by limitation and the First Appellate Court also committed an error and failed to take note of the fact that sale deed dated 02.04.2004 as per Ex.D14, the suit as brought by plaintiff is barred by limitation, but erroneously given the finding that the suit is in time. It is also contended that during the pendency of the appeal, the defendant No.5 has filed an application under Order 41, Rule 23, 23A and 25 of CPC requesting to frame an additional issue with regard to readiness and willingness and to permit the defendant No.5 to lead further evidence. However, the First Appellate Court did not advert to the said application and no order has been passed either to dismiss the application or to allow the application. Hence, the First Appellate Court has failed in its duty to dispose of the application filed by the defendant No.5. It is also contended that the First Appellate Court failed to examine the oral and documentary evidence produced by the appellant and respondent No.1 and no finding is

19 recorded independently than that of the one recorded by the Trial Court and not formed the point for consideration, except forming the point whether the judgment of the Trial Court is perverse, capricious and not applied its judicious mind.

21 Trial Court ought to have drawn inference against the plaintiff that all of them colluded with each other and filed the suit for the relief of specific performance and instead drawn inference against the defendant No.5 by taking non- appearance of defendant Nos.1 to 4, who contested the same. Learned counsel also would vehemently contend that defendant Nos.1 to 4 have executed the sale deed in favour of the appellant/defendant No.5 on 02.04.2004 is not in dispute in terms of Ex.D14.

22 vehemently contend that when there was sale agreement dated 05.07.2002 in terms of Ex.D12, the document of Ex.P1 is not impounded, since proper stamp duty is not paid in respect of the agreement and also delivering the possession in terms of the alleged agreement.

23 Ex.P1. The learned counsel also would vehemently contend that when the sale deed came into existence in 2001, insertion of the name of the subsequent owner in the prior agreement clearly discloses that the document was created. The second sale deed dated 23.10.2000 is produced as Document No.2 along with the application filed under Order 41, Rule 27 read with Section 151 of CPC and referring this additional document, learned counsel brought to notice of this Court that when sale deed was registered in favour of Sri A. Srinivasamurthy on 17.04.2004, how could there be a reference of Sri A. Srinivasamurthy’s property which exists on the north in the boundary mentioned in respect of ‘B’ schedule property in the agreement of the plaintiff at Ex.P1 is on the north

24 same is not pleaded. The Trial Court also proceeded to come to a conclusion that time is not the essence of the contract and the same is erroneous while answering additional issue with regard to the limitation is concerned. Learned counsel also would vehemently contend that when the alleged agreement came into existence on 27.11.1999 and Ex.P5, notice was issued on 13.09.2004 and almost five years have elapsed from the date of agreement. The suit was filed on 07.02.2005 almost after six years and delay and laches has not been considered by the Trial Court. Learned counsel would further contend that the plaintiff has not sought for the relief of cancellation of the sale deed at Ex.D14 and direction is sought only to execute the sale deed in favour of defendant Nos.1 to 4 and unless the relief is sought for cancellation of sale deed, the question of direction to defendant Nos.1 to 4 to execute the sale deed does not arise and the same is erroneous. Learned counsel also would vehemently contend that the judgment passed

25 by the Trial Court and the First Appellate Court is nothing but non-application of mind and finding of both the Courts is erroneous. The Trial Court committed an error in Para No.20 of the judgment and First Appellate Court also committed an error in not invoking Section 16(c) of the Specific Relief Act, 1963 and also the contention that appellant/defendant No.5 is the bonafide purchaser. The plaintiff has contended in the plaint that the defendants suppressed the earlier agreement and sold the property to defendant No.5 and the same has been accepted by both the Courts. Hence, it requires interference by answering the substantial questions of law in favour of the appellant.

26 perform his part of contract. The counsel also brought to notice of this Court discussion made in Para No.17 i.e., readiness and willingness on the part of the Respondent- plaintiff, had not been properly appreciated by the Courts below. Emphasizing on Section 16(c) of the Specific Relief Act, 1963 and the plaintiff has to prove, regardless of any default by the original Defendant. Learned counsel also brought to notice of this Court Para No.20, wherein the Apex Court has discussed with regard to Section 16(c) of the Specific Relief Act, 1963. The counsel further brought to notice of this Court Para Nos.24, 25 and 26, wherein at Para No.26, the judgment in MAN KAUR VS. HARTAR SINGH SANGHA is discussed and Para No.40 of the said judgment is extracted with regard to readiness and willingness to perform his obligation. Learned counsel also brought to notice of this Court Para Nos.28, 29, 31, 35, 36 and 45, wherein it is observed that the Respondent-Plaintiff has relied upon the notice dated 13.02.2003 and evidences

27 of PW2 and PW3 to prove that he was already ready and willing to perform his part of the contract. Learned counsel also referred Para No.47 of the judgment, wherein the Apex Court has observed that Respondent-Plaintiff has failed to discharge his duty to prove his readiness as well as willingness to perform his part of the contract, by adducing cogent evidence. Learned counsel referring this judgment would vehemently contend that both the Courts failed to consider Section 16(c) of the Specific Relief Act, 1963.

28 obligation imposed by Section 16 is upon the Court not to grant specific performance to a plaintiff who has not met the requirements of clauses (a), (b) and (c) thereof. A Court may not, therefore, grant to a plaintiff who has failed to aver and to prove that he has performed or has always been ready and willing to perform his part of the agreement the specific performance whereof he seeks.

29 may be right in stating that mere delay without more would not disentitle his client to the relief of specific performance, for the reasons stated above, we find that this is not such a case. The High Court was clearly right in finding that the bar of Section 16(c) was squarely attracted on the facts of the present case, and that therefore, the fact that Defendants 2 and 3 may not be bona fide purchasers would not come in the way of stating that such suit must be dismissed at the threshold because of lack of readiness and willingness, which is a basic condition for the grant of specific performance. Learned counsel referring these judgments would vehemently contend that the Trial Court and the First Appellate Court committed an error in granting the relief of specific performance.

30 plaint as well as in the evidence, comes to the conclusion that the plaintiff has proved the case. Learned counsel also would vehemently contend that the Trial Court also taken note of the document Ex.P1 dated 27.11.1999 and rightly comes to the conclusion that suit is within time and the same is also appreciated by the First Appellate Court. Having taken note of the documents, particularly documents at Exs.P24 and P25, there was a preliminary notification in terms of Ex.P24 dated 03.06.1999 and also final notification Ex.P25 dated 08.04.2003 and out of 23 acres, 9 acres 4 guntas was acquired and both the Courts have considered the limitation properly and the same is not hit by limitation as contended by the learned counsel for the appellant.

31 case and the said fact is also taken note of by the Trial Court and the persons, who have executed the document have not come forward to deny the very execution of agreement dated 27.11.1999. Learned counsel also would vehemently contend that in support of the case of the plaintiff, he has examined P.W.2, who is the attesting witness to the document of Ex.P1 and nothing is elicited in the cross-examination of P.W.2 and Section 68 is also complied with and the evidence of P.W.2 is not disproved. The onus on the defendant No.1 has not been discharged and Section 16(c) of the Specific Relief Act, 1963 is complied with and the very contention that Section 16(c) has not been complied with cannot be accepted. The evidences of P.W.1 and D.W.1 is important and nothing is found in the evidence of P.W.1 to discredit the case of the plaintiff and also nothing is found in the evidence of D.W.1 with regard to the allegation made against the plaintiff.

32 27. Learned counsel also would vehemently contend that in terms of Ex.D12, an advance amount of Rs.75,000/- was paid and contend that there is an endorsement for having paid an amount of Rs.90,000/- in all. Learned counsel also would vehemently contend that affidavit which is filed in terms of Ex.D13 is contrary to the pleadings and also the evidence led by the defendants. Learned counsel would further contend that defendants were having the knowledge and though they contend that Ananda was signatory to general power of attorney, he has not been examined.

Learned counsel also would vehemently contend that plaintiff has pleaded and proved Section 16(c) and also paid advance of Rs.6,00,000/- and the same is more than 50% of the amount. Learned counsel also would vehemently contend that both the Courts have given concurrent finding and the same does not require any interference and contend that additional documents which have been produced are not helpful to the

33 appellant and the same supports the case of the respondents.

(2010) 1 SCC 287 and brought to notice of this Court Para No.22, wherein an observation is made that in order to decide this question, it would be relevant for us to look into the clauses in the agreement entered into by the parties because they are of utmost importance, while considering time is the essence of the contract. Learned counsel also brought to notice of this Court Para No.24, wherein it is discussed with regard to clauses of contract of sale and in Para No.25, it is observed that time was of the essence of the contract, then also, in the surrounding circumstances, it can always be held that the agreement must be performed

34 within a reasonable time and time was not of the essence of the contract.

35 LAL reported in (2008) 5 SCC 676 and brought to notice of this Court Para No.6, wherein the Apex Court has discussed with regard to clause which is of significance and also brought to notice of this Court Para No.9 with regard to Section 16(c) of Specific Relief Act and so also Section 10, wherein it is observed that the basic principle behind Section 16(c) read with Explanation (ii) is that any person seeking benefit of the specific performance of contract must manifest that his conduct has been blemishless throughout entitling him to the specific relief.

36 subsequent transferee to join in the conveyance so as to pass on the title which resides in him to the plaintiff. He does not joint in any special covenants made between the plaintiff and his vendor; all he does is to pass on his title to the plaintiff.

(2017) 9 SCC 622 and brought to notice of this Court Para Nos.22 and 23, wherein the Apex Court has discussed with regard to sale consideration and payment and in Para No.29, discussed with regard to execution of the sale deed and observed that whatever amount which Defendants 1-5 received from Defendant 6, the same has to be refunded by Defendants 1-5 to Defendant 6. Nevertheless, Defendant 6 would join in execution of sale deed in the plaintiff’s favour along with Defendants 1-5 as held by this Court in DURGA

37 PRASAD’s case for conveying the valid title of the suit house to the plaintiff. Learned counsel also brought to notice of this Court Para No.30, wherein the Apex Court has observed that we, therefore, consider it just and proper and with a view to end this litigation between the parties which is pending since last more than 3 decades and to balance the equities amongst the parties to the suit/appeal, direct that amount which they received as part of sale consideration from Defendant 6.

38 attorney was executed in the year 2003 itself. But, the very contention of the plaintiff that payment was made by cash is not substantiated by the plaintiff. The fact that agreement was in favour of the son of the defendant No.5 is not in dispute, but sale is made in favour of the father. Hence, both the Courts have committed an error in appreciating both oral and documentary evidence placed on record and the Court has to mainly take note of Section 16(c) of the Specific Relief Act, 1963.

39 he has not been examined before the Trial Court. Hence, the appeal is liable to be dismissed.

40 registered on 17.04.2001, question of mentioning the property of Srinivasareddy in the sale agreement dated 27.11.1999 does not arise. Hence, it is clear that Ex.P1 is a created one and recently only came to know about the same and obtained certified copy. The said document is relevant for consideration and also in paragraph No.6, it is stated with regard to sale deed dated 23.10.2000 executed in favour of one Sri.H.Manjuramaswamy in respect of 17 guntas of land in Sy.No.11 of Uttarahalli, Manavarthe Kaval, Uttarahalli hobli, the same is also produced with regard to not obtaining the sale deed even assuming that there was a sale agreement Ex.P1 which was in existence in the year 1999 itself. The plaintiff himself along with his father and brother have conveyed the land by executing the above said sale deed in respect of portion of land in Sy.No.11. The contention that they could not get the sale deed registered as there was an acquisition proceeding is totally false. In the objection statement respondent/plaintiff contended that

41 it is settled legal position of law rendered in plethora of judgment by the Hon'ble Apex Court that, production of additional document at the stage of appeal is always permissible subject to test as contemplated under the law. The production of document at the stage of the appeal can be permitted to produce the same and allowing the parties to lead evidence and even matter may be remitted back to the extent of recording evidence so far document ought to be produced in the appellate stage. In the instant case, in one of the sale deed, the plaintiff is one of the executant of the sale deed and that aspect will not anyway support the case of the plaintiff to defer the defense or to defeat the case of the plaintiff. Further in any event allowing of application to produce those documents would not support hands of this Court to render the judgment in the case on hand. If application is allowed it would be wasting of precious time and it would postpone taking of decision. Even the sale deed dated 17.04.2001 is also no way assist

42 or support the case of the appellant. Hence, the same is not required. 37. Having perused the application and statement of objections, the appellant would rely upon these documents for the execution of sale deed in the year 2000 itself. Even if any acquisition proceedings is pending and also another document to show the document of Ex.P1 is created, since the sale deed of the year 2001 and sale was made in favour of Srinivasareddy. When the said property was sold in the year 2001, question of mentioning the name of the Srinivasareddy in the northern boundary in the document of 1999 does not arise. 38. Having taken note of the said fact into consideration and also both documents are also registered documents. The respondent/plaintiff also not disputed these two documents and only contend that these two documents will anyway not support the case of the appellant to defer the defense or to defeat the case of the plaintiff. The sale

43 deed in favour of Srinivasareddy is also no way assist or support the case of the appellant. When the documents are not disputed and only contention was raised that whether those documents help the appellant or not and the same is a matter of consideration. Even if these documents are not disputed, even question of the apprehension of postponing the judgment and material documents for consideration also does not arise. There is a force in the contention of the appellants’ counsel that application requires to be allowed invoking Order 41 Rule 27 of CPC. In order to meet the provision under Order 41 Rule 27 of CPC also, it is specifically pleaded in the affidavit that recently comes to know about the execution of sale deed and obtained the certified copy and produced the same. When the document was not within the custody of the appellant, when the case was set down for evidence, question of producing the same does not arise. The document was also taken in the year 2023. Hence, the requirement under Order 41 Rule 27 of

44 CPC is met by the appellant herein. Other document is also obtained in 2017 and hence the appellant has made out the ground to invoke the provision under Order 41 Rule 27 of CPC. These two documents are also crucial documents for consideration of the contention of the appellant. Hence, for the limited purpose, I.A is allowed. I have already pointed out that these documents are not disputed by the respondent/plaintiff and question of even remitting back the matter also does not arise, since both the documents are registered documents. Only contention is that these documents will not help the appellant. Hence, I.A deserves to be allowed. 39. This Court has framed three substantial question of law and out of that 1st substantial question of law is whether both the Courts have committed any error by admitting Ex.P1 in evidence and also have committed error in appreciation of Ex.P1. Having perused the material available on record, admittedly the document Ex.P1 is not

45 registered document and only contention is that in terms of the Ex.P1 possession is delivered and hence the document ought to have been registered and the said contention cannot be accepted. But, Court has to look into whether both the Courts below have committed an error in appreciation of Ex.P1. On perusal of the document Ex.P1 which is the subject matter of the suit, it is clear that the same is dated 27.11.1999, the same is also executed by the defendant Nos.1 and 2 along with their minor children. 40. It is also important to note that in terms of this agreement, rate fixed per acre is Rs.4,00,000/- and paid the advance amount of Rs.6,00,000/- and also there is a recital in the document that having received the advance amount they have given possession to the plaintiff and so also delivered the original documents to the plaintiff. It is also important to note that it is mentioned with regard to, it is their duty to get it clear the suit schedule property from the acquisition proceedings and on clearance of the

46 acquisition proceedings, going to register the sale deed. Having perused this document there is no any time stipulation for execution of sale deed. In the document, two schedules are shown as item No.1 in respect of Sy.No.11 in respect of 1 acre 30 guntas and also ‘B’ Schedule is shown in the very same Sy.No.11 wherein the boundary shown on the north property of Srinivasareddy. 41. The main contention of the appellants’ counsel also that when the boundary is shown on the northern side of property of Srinivasareddy and as on the date of the agreement dated 27.11.1999 there was no any sale transaction in favour of Srinivasareddy and the document No.1 sale deed dated 17.04.2001 produced along with I.A filed under Order 41 Rule 27 of CPC and also when the sale was made on 17.04.2001, when such being the case, question of reflecting the name of Srinivasareddy in the agreement of sale dated 27.11.1999 does not arise. Hence, it is the contention of the appellants’ counsel that it clearly

47 discloses that the said agreement of sale vide document of Ex.P1 is a created one and there is a force in the contention of appellants’ counsel. The sale transaction was taken place on 17.04.2001 in favour of Srinivasareddy, question of mentioning the property of Srinivasareddy on the north does not arise in 1999 sale agreement, the same creates the doubt in the mind of the Court with regard to the creation of document of agreement of sale of the year 1999. When the document was registered in the year 2001, that too almost after two years, no explanation on the part of the counsel appearing for the plaintiff with regard to the mentioning of northern boundary property of Srinivasareddy. No doubt this document was not placed before the Trial Court. 42. It is also important to note that when the PW1 was examined before the Trial Court, he categorically admitted in the cross-examination that the plaintiff and defendant No.1 are the relatives and defendant No.1 is the

48 uncle and defendant No.2 is wife of defendant No.1. The defendant Nos.3 and 4 are children of their uncle and hence it is clear that all of them are relatives. It is also important to note that the PW1 also categorically admitted that his another uncle Lingappa having a son by name Ananda. He also admits that he does the real estate business and suggestion was made that he himself and his uncle’s son Ananda both of them doing real estate business, the same was denied. But, the fact that the plaintiff and the defendant Nos.1 to 4 are relatives is not in dispute. When such being the case, the Trial Court also ought to have examined the case meticulously and consciously. 43. It is the case of the defendant No.5 also that Ex.P1 is created document and also PW1 admits in the cross-examination that Ex.P1 – Stamp Paper was purchased by one of the witness Shivaram, the same is not purchased either by the vendors or by the purchasers. It is also important to note that the plaintiff is aware of the sale deed

49 dated 02.04.2004. He admits that he has not given any paper publication. He also admits that for having paid an amount of Rs.6,00,000/-, he has shown the same in the income tax returns and he is not having any difficulty to produce the same, the same is also not produced before the Trial Court. 44. It is also important to note that the document of Ex.P1 is not a registered document and also it is important to note that a suggestion was made that sale agreement was executed in favour of son of defendant No.5 by defendant Nos.1 to 4, but he says that he is not aware of the same. It is also important to note that it is suggested that suit schedule property was in possession of son of defendant No.5 from 2002 itself. It is also suggested that possession was delivered on the date of the registration of the sale deed on 02.04.2004 and witness denies that he is not aware of the same. It is important to note that PW1 not denies specifically but he claims that he is not aware of the

50 same with regard to the delivery of the possession. It is important to note that he categorically says that in terms of the Ex.P12, he gave the paper publication in the month of August-2004. When the suggestion was made that had he seen the suit schedule property, but he claims that he has been in possession of the same. But, it is important to note that a suggestion was made that Bheemachandra Education Trust Herbal Garden had constructed employees’ quarters in the suit schedule property and the same was denied. But, when the 11 photographs were confronted to the witness, he admits that the said buildings are in existence in the suit schedule property but, he claims that he himself has constructed the same. The said photographs are also marked as Ex.D1 to Ex.D11. It is further important to note that when he claims that he constructed the same, but question was put to him that whether he has stated the same in the plaint and in his chief evidence. But, he categorically admits that he did not mention the same.

51 When these admissions are elicited from the mouth of PW1 and with regard to the delivery of possession is concerned, the Trial Court ought to have discussed the same. Both the Trial Court as well as the First Appellate Court have not discussed anything about this admission and also with regard to the deliver of possession in the year 1999 itself. If the possession was delivered in the year 1999 itself and question of constructing the 11 quarters and the same has not been pleaded in the plaint and also in his evidence, it is clear that both Courts have lost sight of this evidence available on record. 45. It is also important to note that a specific question was put to the PW1 that the defendant No.5 after purchasing the property and construct the building, he has obtained the electricity connection, the same also not categorically denied, but he says that he is not aware of the same. But, the defendant has produced the document of electricity records as Ex.D15 and Ex.D16. These are the

52 material aspects which are not been considered by the Trial Court and appellate Court. It is also important to note that in the cross-examination, suggestion was made that Ex.P1 is created one. The defendant Nos.1 to 4 have not executed the sale agreement and the same has been denied. It is specifically put the question that when the sale deed was executed in favour of defendant No.5 and at that time, Ex.P1 is not in existence. 46. It is also important to note that the plaintiff has examined another witness as PW2 who is the signatory to the sale agreement of Ex.P1 and he re-iterates the case of the plaintiff in his chief evidence. But, when he was subjected to cross-examination, he also categorically admits with regard to the photographs marked as Ex.D1 to Ex.D11, but he claims that the said building which is in existence in the suit property contend that the plaintiff has constructed the building. On the other hand, it is the suggestion that, the same is staff quarters of

53 Bheemachandra Education Trust and this witness also says that he is not aware of the same, but not denied the same specifically. Hence, it is very clear that both PW1 and PW2 have admitted the structure which is in existence in the suit schedule property in terms of Ex.D1 to Ex.D11 and only claim is that the same was constructed by PW1. In order to substantiate the possession which was delivered in favour of the PW1 in terms of Ex.P1, except the averment in Ex.P1 with regard to the delivery of possession, nothing is placed on record. On the other hand, it is the case of the defendant No.5 that they have constructed the staff quarters and only they deny that they are not aware of it. The PW1 categorically admits that when he claims that he had constructed the same, but in the plaint as well as in the evidence, he has not pleaded the same. The said answers ought to have been considered by the Trial Court with regard to the delivery of possession is concerned. Since, the Trial Court also framed the issue with regard to the delivery

54 of possession in favour of the plaintiff in terms of the Ex.P1 and also framed issue No.3 as whether the plaintiff proves that the defendants have handed over the actual and physical possession of the suit schedule property in pursuance of the sale agreement. Though it is mentioned in Ex.P1 that there was a delivery of possession and answers elicited from the mouth of PW1 and PW2 is clear that possession was not delivered. Apart from that construction was made by the defendant. If really the possession was delivered and the plaintiff has constructed the said building, he would have pleaded the same in the plaint itself and also not pleaded the same and even in the evidence also he has not stated anything about the same. 47. It is also important to note that the other issue No.2 whether the defendants have received part sale consideration of Rs.6,00,000/- by way of cash under the agreement of sale. It is also important to note that the plaintiff has not placed any document for having paid the

55 amount of Rs.6,00,000/- and with regard to his claim is concerned, question was put the witness PW1 and though he admits that it has been reflected in the income tax returns and there is no difficulty to produce the same, but the same is not produced before the Trial Court. The Trial Court fails to take note of the fact that the said document is an unregistered document and if really made the payment in the year 1999 itself, the plaintiff ought to have produced the documents before the Court. The Trial Court also fails to take note of the document of electricity connection taken by the defendant subsequent to registering the power of attorney in respect of the said quarters which have been constructed as claimed by the defendant. The PW1 only denies with regard to the connection of electricity saying that he is not aware of the same. The PW2 also says that he is not aware of the same. But, the PW2 says that an amount of Rs.6,00,000/- was drawn from the bank, but he cannot tell from which bank the amount was drawn. The

56 PW1 also not given any details of from which bank he has drawn the money. When such being the case, when the document is unregistered document and Trial Court ought to have taken note of said fact into consideration while answering issue No.2 also. In order to show that an amount of Rs.6,00,000/- was paid to the defendant Nos.1 to 4, no material is placed on record. However, the Trial Court and First Appellate Court accepted the contention of the plaintiff. 48. It is also important to note that when the defendant Nos.1 to 4 are the relatives of the plaintiff and defendant No.1 is the uncle of plaintiff and no doubt defendant Nos.1 to 4 have not contested the case. Only on the ground that they have not contested the case, the Trial Court comes to the conclusion that by drawing an inference in favour of the plaintiff that there was a sale agreement in terms of Ex.P1 and ought not to have drawn such an

57 inference when the plaintiff and defendant Nos.1 to 4 are the close relatives. 49. It is also important to note that it is the contention of the defendant No.5 that sale transaction was mediated by the plaintiff as well as his uncle’s son one Anand. No doubt the said Anand has not been examined, but the document of sale agreement which is marked as Ex.D12, wherein the signature of Anand was found in this document. Apart from that, in the shara also the signature of said Anand was found. It is also important to note that with regard to the delivery of possession is concerned, an affidavit is executed in terms of Ex.D13. The Trial Court considered this document Ex.D13 as against the defendant wherein the said Anand has signed the document as witness. Apart from that, Ex.D14- is the sale deed which is executed in the year 2004 consequent upon the document Ex.D12-sale agreement.

58 50. It is also important to note that on the other hand, the defendants also produced the document Ex.D24 - is the power of attorney which was executed by the defendant Nos.1 to 4 in favour of the defendant No.5, the said document was registered in the year 2003 i.e., on 08.09.2003 itself, wherein also the said Anand has signed the document who is none other than son of Lingappa according to the PW1 and the said fact has not been disputed in the evidence of PW1 throughout his evidence. 51. It is also important to note that Ex.D15 and 16 are the electricity supply document and the same was taken on 23.02.2004 itself and even prior to the execution of the sale deed and i.e., subsequent to the execution of the General Power of Attorney in favour of the defendant No.5 in the year 2003, the sale deed was executed in the month of April-2004. This document is also evident that electricity supply was given in favour of the defendant No.5 and details of defendant No.5 is also mentioned in the document

59 of electricity bill. Hence, it is clear that the photos which have been produced as Ex.D1 to Ex.D12 which reflects the construction of the building. Though the plaintiff claims that he has constructed the same, I have already pointed out that, the same is not pleaded and not adduced any evidence and photographs which have been produced are very clear that construction was made and electricity connection was also taken. The defendant No.5 placed the material before the Court that with regard to the fact that he has been in possession of the suit schedule property. Inspite of all these materials are produced before the Court, the Trial Court committed an error in answering the issue Nos.2 and 3. The other contention of appellants’ counsel also that the Trial Court committed an error in exercising the discretion in favour of the plaintiff since the same has not been proved. 52. This Court also while admitting the appeal, framed the substantial question of law i.e., 3rd substantial

60 question of law whether the exercise of law of discretion under Section 20 of the Specific Relief Act in ordering Specific Performance was unwarranted in the circumstances of the case. I have already pointed out that document of Ex.P1 is doubtful and though the document was of the year 1999 and boundary of subsequent purchaser who has purchased the property in the year 2001 was mentioned in the northern boundary. Hence, it is clear that the Ex.P1 is created one. Both the Courts have committed an error in appreciation of Ex.P1 and also while the Court exercising the discretion, ought to have taken note of the fact that possession is with the defendant No.5. Though plaintiff claims that he has been in possession, nothing is placed on record before the Trial Court for having delivered the possession in favour of the plaintiff in terms of the document Ex.P1. 53. The Court while exercising the discretion has to take note of material on record and ought to have exercise

61 the same in a judicious manner. When the document of Ex.P1 itself is doubtful and delivery of possession itself is doubtful, ought not to have exercised the discretion in favour of the plaintiff in accepting Ex.P1. The very exercising of discretion under Section 20 of the Specific Relief Act is erroneous and ordering for specific performance was not warranted in the circumstances of the case and fails to take note of the material available on record and failed to appreciate the said fact. 54. The counsel appearing for the appellant relied upon the several judgment with regard to the Section 16(c) is concerned and no doubt the principles are very clear with regard to the Section 16(c) is concerned. But, in the case on hand, when the very document of Ex.P1 is doubtful and came into existence in a suspicious circumstances, question of discussing in detail with regard to the Section 16(c) does not arise. No doubt the counsel appearing for the respondent relied upon several judgments with regard to

62 the granting of relief of specific performance and giving direction to the execution of sale deed even in the absence of any relief is sought for cancellation of earlier sale deed. The counsel also relied upon several judgment which have been referred supra with regard to compliance of Section 16(c) is concerned. 55. Having taken note of this Court has re- appreciated both oral and documentary evidence available on record and comes to the conclusion that the document of Ex.P1 came into the suspicious circumstances and also no material is placed with regard to having made the payment. Apart from that, possession is also not delivered and possession with the defendant No.5 who had purchased the property who had constructed the building and obtained electricity connection. All these materials have not been considered by the Trial Court and also the appellate Court while granting the relief of specific performance. Both the Courts blindly comes to the conclusion that the plaintiff was

63 always ready and willing to perform his part of contract and erroneously drawn the inference in favour of plaintiff only on the ground that defendant Nos.1 to 4 have not contested the case. 56. The other contention of the respondent’s counsel is also that the property was under acquisition. No doubt the said survey number was in acquisition proceedings. The document Ex.P24 and Ex.P25 are also discloses preliminary notification in the year 1999 and also final notification in the year 2003. The fact that the document which has been produced before this Court along with additional documents i.e., sale deed of the year 2000 itself is clear that the very plaintiff executed the sale deed in respect of of the very same survey number in favour of Sri.H.Manjuramaswamy along with his family members that was in the year 2000 i.e., also after the issuance of preliminary notification, the same is also in respect of Sy.No.11 to the extent of 17 guntas out of 3 acres 20 guntas. When no such prohibition

64 for obtaining the sale deed and the plaintiff ought to have obtained the sale deed in his favour even if the document Ex.P1 was in existence prior to the preliminary notification. This document also goes against the plaintiff. The very contention that acquisition proceedings was pending for consideration. The fact that entire land of Sy.No.11 was not acquired and only portion of the property was acquired. If really there was a sale agreement in terms of Ex.P1 and ought to have obtained the sale deed immediately. No case is made out in support of the document of Ex.P24 and Ex.P25 that there was a bar to execute the sale deed in favour of the plaintiff. 57. It is also important to note that a document of sale was executed according to the plaintiff in the year 1999 and also it is important to note that subsequently sale agreement was executed in favour of son of defendant No.5 and also possession was delivered in favour of son of defendant No.5 and buildings are constructed and apart

65 from that registered power of attorney was executed in the year 2003 itself and sale deed was executed in the month of April-2004. Though contend that he comes to know about the same in the month of August, thereafter he has caused the notice and also issued paper publication and filed the suit. But, immediately after coming to know about the sale deed, he would have approached the Court immediately but not filed the suit from August to February, no explanation is given for delay in filing the suit also. Hence, the Trial Court committed an error in exercising the discretion in favour of the plaintiff invoking Section 20 of Specific Relief Act. Hence, I answered the 3rd substantial question of law as affirmative and exercising of discretion is not warranted. 58. The 2nd substantial question of law framed by this Court is whether the finding of the Court below with regard to the limitation aspect was erroneous in the circumstances of the case. Having perused the Ex.P1 and

66 time is not the essence of the contract and also having considered the recitals made in document Ex.P1, a reference was made with regard to the acquisition proceedings. When such being the case, when the plaintiff came to know about the registration of document, thereafter only, issued the legal notice in the year 2004. Both the Courts taken note of the fact that when the time is not the essence of the contract and comes to a conclusion that suit is within time. 59. Having considered the finding is concerned, this Court does not find any error committed by both the Court, but this Court while answering substantial question of law in respect of the very admitting of document Ex.P1 in evidence and error in appreciation of Ex.P1, comes to a conclusion that very agreement is doubtful and the same is came into existence in a suspicious circumstances and it appears that the document is created one and also answered substantial question of law as affirmative that

67 both the Courts have committed an error in appreciation of Ex.P1 and also invoking of Section 20 of the Specific Relief Act in ordering specific performance which was unwarranted in the circumstances of the case and finding in respect of substantial question of law i.e., 2nd substantial question of law will not enure any benefit in favour of the respondent. Hence, in view of the finding on substantial question of law 1 and 3 as against the respondent, the appellant succeeds in the appeal. The judgment and decree of the Trial Court and appellate Court requires to be set-aside. 60. This Court would like to refer the scope of Regular First Appeal under Section 96 of CPC and also Order 41 of CPC exercising appellate jurisdiction in keeping the fact that the First Appellate Court appeal is a statutory appeal and while exercising the powers as conferred under the provisions of Section 96 of CPC as well as while exercising the power under Order 41 take note of Rule 22, 23 and 28 and also Rule 33 of Order 41 of CPC. It is the

68 duty of the appellate Court to formulate the point in keeping the grounds urged in the appeal and not only formulating the point as whether the Trial Court judgment is perverse and whether it requires interference, the same is not the power of the appellate Court and Court has to take note of the crux of the issues and also the questions involved in the suit and formulate the point, the grounds which have been urged in the plaint and written statement, the same has been considered or not by the Trial Court and it is invariably and generally noticed in second appeal that the Presiding Officers in the First Appellate Court in a casual manner formulating the points as formulated in the impugned judgment of appellate Court, which reads as hereunder: “1. Whether the impugned judgment and decree is perverse, capricious or illegal?

70 Court not exercised the judicious mind and in a casual manner framed the point for consideration as whether the judgment of the Trial Court requires interference and the same is not the scope in a statutory appeal. The grounds which have been urged in the appeal is not considered in a judicious manner. 60. In view of the discussions made above, I pass the following: ORDER

i) The appeal is allowed. ii) The impugned judgment of the Trial Court and also the First Appellate Court are set-aside. Consequently, suit for the relief of specific performance is dismissed. iii) The application filed under Order 41 Rule 27 of CPC is allowed.

71 iv) The Registrar Judicial is directed to circulate this judgment to the Appellate Judges working in the District Judiciary with regard to the exercising of appellate jurisdiction in view of an observation made in the judgment.

Sd/- JUDGE ST, RHS