M/S.Shivali Enterprises Etc. vs Smt. Godawari (Deceased) Thr. Lrs.

M/S. SHIVALI ENTERPRISES ...APPELLANT(S)

VERSUS SMT. GODAWARI (DECEASED) THR. LRS. AND OTHERS ...RESPONDENT(S)

JUDGMENT

B.R. GAVAI, J.

1. These appeals challenge the judgment dated 3 rd

March 2008 passed by the learned Single Judge of the High

Court of Punjab and Haryana at Chandigarh in Regular

Second Appeal Nos. 1206 and 1207 of 2005, thereby allowing

the appeals filed by the respondents­defendants challenging

the concurrent judgments and decrees dated 3 rd January

2001 passed by the Additional Civil Judge (Senior Division),

Faridabad (hereinafter referred to as the “trial court”) in RBT

329/90/2000, and 8th February 2005 passed by the learned 1 District Judge, Faridabad (hereinafter referred to as the

“Appellate Court”) in Civil Appeal No. 11 of 2001. Vide the

impugned judgment, the learned Single Judge of the High

Court directed that, if the plaintiff desires to get the sale deed

executed pursuant to the agreement(s) to sell, he would do so

by paying the present prevalent market value as sale

consideration. The appellant­plaintiff has also assailed the

order dated 10th April 2008 passed by the learned Single

Judge of the High Court, thereby dismissing the review

applications being R.A. No. 19­C of 2008 in R.S.A. No. 1206

of 2005 and R.A. No. 18­C of 2008 in R.S.A. No. 1207 of

2005, filed by the appellant­plaintiff.

2. Facts in brief giving rise to the present appeals are

as under:

The appellant­plaintiff through its partner Raj

Kumar, entered into an agreement to sell dated 29 th October

1983 with the respondents­defendants No. 1 to 4 with regard

to the suit property, which was situated in the revenue estate

of Chak Salarpur, Tehsil Dadri, District Ghaziabad (U.P.), at

the rate of Rs. 2900/­ per Bigha. Though the suit property

initially was in the State of U.P., vide notification of the

2 Central Government dated 15 th September 1983, it became a

part of the State of Haryana. At the time of agreement to sell

dated 29th October 1983, earnest amount of Rs.50,000/­ was

paid by the appellant­plaintiff to the respondents­defendants.

3. Due to a dispute between the State of U.P. and

Haryana, the aforesaid sale deed could not be executed in

favour of the appellant­plaintiff. Therefore, another

agreement to sell was executed between the parties on 23 rd

August 1985. At the time of execution of the said agreement,

an additional amount of Rs.1,00,000/­ was paid by the

appellant­plaintiff to the respondents­defendants. It is not in

dispute that the total amount payable as per the terms of the

agreement to sell dated 29th October 1983 was Rs.

1,65,000/­ out of which, an amount of Rs. 1,50,000/­ was

duly received by the respondents­defendants on or before

23rd August 1985. As per the terms of the agreement(s) to

sell, the remaining sale price was to be paid before the Sub­

Registrar at the time of execution and registration of sale

deed. It is not in dispute that the physical possession of the

suit property was also delivered to the appellant­plaintiff by

the respondents­defendants at the time of execution of the

3 agreement(s) to sell. It is also not in dispute that the

appellant­plaintiff is thereafter in continuous possession of

the suit property.

4. As per the terms of the agreement(s) to sell, the

respondents­defendants were required to obtain Income­Tax

Clearance (for short “ITC”) Certificate and to also get the

revenue records mutated to show them as the owners

inasmuch as the Central Government was shown as the

owner mistakenly. The agreement to sell further stipulated

that, in case of default by the respondents­defendants, the

appellant­plaintiff was at liberty to get the sale deed executed

and registered.

5. After coming to know that the respondents­

defendants were trying to create 3rd party rights, the

appellant­plaintiff filed a suit for specific performance with

further prayer for permanent injunction as against the

respondents­defendants. The said suit was resisted by the

respondents­defendants by filing their written statement.

The learned trial court vide judgment and decree dated 3 rd

January 2001 decreed the suit. In an appeal filed by the

respondents­defendants, the learned Appellate Court upheld

4 the findings of the trial court vide judgment and decree dated

8th February 2005.

6. Being aggrieved thereby, the respondents­defendants

filed second appeals before the High Court. Vide the

impugned judgment, the High Court reversed the concurrent

findings recorded by the trial court and the Appellate Court

and passed the judgment as aforesaid. Being aggrieved

thereby, the present appeals have been preferred by the

appellant­plaintiff.

7. We have heard Shri Rishi Malhotra, learned counsel

appearing on behalf of the appellant­plaintiff and Shri S.R.

Singh, learned Senior Counsel appearing on behalf of the

respondents­defendants.

8. Shri Malhotra submitted that the High Court has

grossly erred in interfering with the concurrent findings

passed by the trial court and the Appellate Court. He

submitted that, since no substantial question of law arose for

consideration before the High Court, the appeals deserve to

be allowed on this short ground alone. He relies on the

judgment of this Court in the case of Kondiba Dagadu

5 Kadam v. Savitribai Sopan Gujar and Others1 in this

regard.

9. Shri Malhotra further submitted that, even

assuming that in view of the provisions of Section 41 of the

Punjab Courts Act, 1918 (hereinafter referred to as the

“Punjab Act”) it is not necessary to frame a substantial

question of law, the jurisdiction of the learned Single Judge

of the High Court would still be circumscribed by the

provisions of Section 41 of the Punjab Act and any

interference in second appeal would only be warranted if the

case falls within the limited area as earmarked in Section 41

of the Punjab Act.

10. He further submitted that the respondents­

defendants have not entered into the witness box and as

such, the case of the appellant­plaintiff on the basis of the

agreement(s) to sell has gone unchallenged. He therefore

submitted that the appeals deserve to be allowed and the

impugned judgments are liable to be quashed and set aside.

11. Shri Singh, on the contrary, submitted that the High

Court has rightly allowed the second appeals. He submitted

1 (1999) 3 SCC 722 6 that, as per the terms of the agreement(s) to sell, the sale

deed was to be registered only after the ITC Certificate was

obtained and the property was mutated in the name of the

respondents­defendants. He submitted that the respondents­

defendants had filed a suit for getting the suit property

mutated in their names on 4th June 1986 and the said suit

came to be decreed only on 22nd December 2006. It is

therefore submitted that the suit filed by the appellant­

plaintiff on 17th October 1989 was premature.

12. Shri Singh submitted that in view of the Punjab Act,

no substantial question of law was required to be framed. He

relies on the judgment of this Court in the case of Kulwant

Kaur and Others v. Gurdial Singh Mann (Dead) By LRs.

and Others2. The learned Senior Counsel further relies on

the judgments of this Court in the cases of Kirodi (since

deceased) Through His Legal Representatives v. Ram

Parkash and Others3 and Satyender and Others v. Saroj

and Others4 in support of this proposition. Shri Singh,

further relying on the judgment of this Court in the case of

2 (2001) 4 SCC 262 3 (2019) 11 SCC 317 4 2022 SCC OnLine SC 1026 7 Nirmala Anand v. Advent Corporation (P) Ltd. and

Others5, submitted that there is no reason to interfere with

the direction of the trial court which directs that if the

plaintiff desires to get the specific performance, the same

shall be done at the prevalent market rate. He further

submitted that the suit itself was not tenable in view of

Section 14 of the Specific Relief Act, 1963.

13. Section 41 of the Punjab Act reads thus:

“41. Second appeals — (1) An appeal shall lie to the High Court from every decree passed in appeal by any Court subordinate to the High Court on any of the following grounds, namely:

(a) the decision being contrary to law or to some custom or usage having the force of law:

(b) the decision having failed to determine some material issue of law or custom or usage having the force of law:

(c) a substantial error or defect in the procedure provided by the Code of Civil Procedure 1908 [V of 1908], or by any other law for the time being in force which may possibly have produced error or defect in the decision of the case upon the merits;

[Explanation — A question relating to the existence or validity of a custom or usage shall be deemed to

5 (2002) 5 SCC 481 8 be a question of law within the meaning of his section:] (2) An appeal may lie under this section from an appellate decree passed ex parte.”

14. This Court, in the case of Randhir Kaur v. Prithvi

Pal Singh and Others6, after considering the scope of

interference under the old Section 100 of the Civil Procedure

Code, 1908 (for short “CPC”) and Section 41 of the Punjab

Act, has observed thus:

“15. A perusal of the aforesaid judgments would show that the jurisdiction in second appeal is not to interfere with the findings of fact on the ground that findings are erroneous, however, gross or inexcusable the error may seem to be. The findings of fact will also include the findings on the basis of documentary evidence. The jurisdiction to interfere in the second appeal is only where there is an error in law or procedure and not merely an error on a question of fact.”

15. It could thus be seen that this Court has held that,

even when a court exercises jurisdiction under Section 41 of

the Punjab Act, it cannot interfere with the findings of fact in

second appeal on the ground that the said findings are

erroneous, howsoever gross or inexcusable the error may 6 (2019) 17 SCC 71 9 seem to be. It has been held that the findings of fact would

also include the findings on the basis of documentary

evidence. The jurisdiction under Section 41 of the Punjab Act

would be available only when there is a substantial error or

defect in the procedure provided by the CPC or by any other

law for the time being in force.

16. A bench of three learned Judges of this Court, in a

recent judgment in the case of Satyender and Others

(supra), has observed thus:

“17. Be that as it may, though the requirement of formulation of a substantial question of law was not necessary, yet Section 41 of the Punjab Courts Act, requires that only such decisions are to be considered in second appeal which are contrary to law or to some custom or usage having the force of law or the court below have failed to determine some material issue of law or custom or usage having the force of law. Therefore, what is important is still a “question of law”. In other words, second appeal is not a forum where court has to re­examine or re­appreciate questions of fact settled by the Trial Court and the Appellate Court. The plaintiffs had claimed right over certain agricultural land and their case was that they have the right to be declared the owner of this property and the possession be handed over to the them, for the reasons that on this particular property defendants and their predecessors­in­interest were the tenants of the plaintiffs. Their case was that defendant No. 2 was their tenant who had sub­let the property in favour of his son, that is defendant 10 No. 1 and therefore, the property should be reverted back to the plaintiffs and they should be declared the owner and should be given the possession of the property as well. Both the Trial Court as well as the First Appellate Court had held after evaluating the evidence placed by the plaintiffs that the defendant No. 2 and his brothers (who were not even made a party by the plaintiffs) were the tenants on the property and defendant No. 2 had not sub­let the property in favour of his son that is defendant No. 1 and the revenue entries being made in this regard in the year 1978 are wrong and without any basis as there was no order of any revenue authority for making such an entry. In short, the plaintiffs had failed to prove their case as owner of the land in dispute. Hence their case of declaration and possession was dismissed. The Second Appellate Court however, quite erroneously, and without any justification, gave an entirely new finding regarding two Killa Nos. 21//3/2 and 7//13 on which the plaintiffs claimed relief of declaration and possession, on the same grounds as raised by them for the other Killa Nos. The pleadings also show that the defendants had made a general denial of the plaintiffs' claim for all the plots. Yet, the High Court held that since the defendants had not made any claim for plot nos. 21//3/2 and 7//13 and therefore by logic a decree of declaration of possession ought to have been given to the plaintiffs for these plots! This reasoning of the second Appellate Court is erroneous for the simple reason that the burden of proof was on the plaintiffs to prove their case, which they had failed. They have not been able to prove to the satisfaction of the Trial Court as well as the First Appellate Court about their claim of any kind over this property. Merely because the defendant did not raise a counter claim on this property it would not ipso facto mean that a decree ought to have been granted in favour of the plaintiffs. Plaintiffs have to prove their case on the strength of their evidence. For this reason, the reasoning given by the Second Appellate Court for

11 decreeing the claim of the plaintiff for plot nos.

21//3/2 and 7//13 is incorrect and to that extent is liable to be set aside.” [emphasis supplied]

17. It would thus be clear that this Court has held that,

though it is not necessary to formulate a substantial

question of law, the jurisdiction under Section 41 of the

Punjab Act would permit only such decisions to be

considered in second appeal which are contrary to law or to

some custom or usage having the force of law, or when the

courts below have failed to determine some material issue of

law or custom or usage having the force of law. The Court

held that second appeal is not a forum where the court is to

re­examine or re­appreciate the question of fact settled by the

trial court or the Appellate Court. It could thus clearly be

seen that though in view of Section 41 of the Punjab Act, it is

not necessary to frame a substantial question of law, the

jurisdiction of the High Court under second appeal cannot be

exercised for re­appreciation of evidence.

18. A perusal of the plaint filed by the appellant­plaintiff

would reveal that the appellant­plaintiff has specifically

referred to the terms of the agreement(s) to sell. He has

specifically stated that the respondents­defendants have 12 received an amount of Rs.1,50,000/­. He has further

specifically stated that the respondents­defendants have

delivered the actual possession of the suit property to him. It

is averred that after the respondents­defendants obtained the

requisite ITC Certificate and got the revenue records

corrected, they were required to serve a notice upon the

appellant­plaintiff informing him about the same having been

done. After the receipt of such notice, the appellant­plaintiff

was required to make the balance payment and get the sale

deed executed. The appellant­plaintiff was also given liberty

to use the suit property in any manner so as to plant trees,

raise construction, install tubewells etc. It has been averred

in the plaint as under:

“10. That all the defendants have been admitting and acknowledging the plaintiff firm to be in possession of the suit land and seeing them spending huge amount over it. The plaintiff has been affecting costly improvements over the suit land and the defendants have been seeing plaintiff spending huge amount objected to it. They are estopped from denying the fact by their acts, conduct, omissions, laches and admissions.

11. That the rates of the land in the dispute have started rising and the defendants out of sheer greed have threatened to take forcible possession, dispossess the plaintiff and to interfere in the peaceful enjoyment of the suit

13 land by the plaintiff about a month ago. They have also threatened to alienate the suit land in favour of the third parties. They have also refused to obtain the requisite Income Tax Clearance certificate and to execute the sale deed in favour of the plaintiff firm as agreed upon in accordance with the terms of the agreement of sale dated 23.8.1985.

12. That defendants No.1 to 4 were repeatedly approached to execute the sale deed in favour of the plaintiff in accordance with the terms of the agreement of sale dated 23.8.1985. The defendants were also further requested to desist from dispossessing the plaintiff, taking forcible possession or otherwise interfering in the peaceful enjoyment of the suit land by the plaintiff. However, defendants after prevarication for some time have finally refused to accede to the reasonable, just and legal request of the plaintiff about a week ago. Hence this suit.

13. That the plaintiff firm has all along been ready and willing to perform its part of the contract and is still ready and willing to do so.

It has all along got the requisite amount of balance sale consideration and expense etc. with it. The defendants have thus committed breaches of agreement of sale as per details above with malafide intention.

14. That cause of action arose about a month ago and again about a week ago on the final refusal of the defendants.”

19. It can thus clearly be seen that the appellant­

plaintiff has specifically averred that due to the rising rate of

the suit property, the respondents­defendants, out of sheer

14 greed, had threatened to take forcible possession and also

threatened to alienate the suit property in favour of a 3 rd

party.

20. In the written statement, the respondents­

defendants have stated that the appellant­plaintiff had

obtained Power of Attorney from the respondents­defendants

and had undertaken to obtain the ITC Certificate. It was

further stated by the respondents­defendants that they had

executed the Power of Attorney and one Mukhtar, an agent of

the appellant­plaintiff, was required to take all the requisite

steps to get the revenue records corrected. It will be relevant

to refer to paragraph (11) of the written statement of the

respondents­defendants as under:

“11. In reply to Para No.11 it is denied that the plaintiffs are in possession of the land in suit;

it is also denied that defendants Nos. l to 4 had to obtain the ITCC; it is also denied that the Plaintiff had the financial capability to purchase the land; it is submitted that defendants Nos. 1 to 4 are in possession of the suit land as owners thereof and an entitled to alienate the same if so desired. It is also denied that the agreement to sell dated 23.8.1985 is in force.” [emphasis supplied]

15

21. A perusal of the aforesaid paragraph would reveal

that the respondents­defendants had denied that the

appellant­plaintiff was in possession of the suit property.

The respondents­defendants further asserted their right to

alienate the suit property, if they so desired.

22. The trial court, after perusal of the evidence, came to

a finding that the execution of the agreement(s) to sell was

admitted by the respondents­defendants. The trial court

further came to a specific finding of fact that the appellant­

plaintiff was always ready and willing to perform his part of

contract. It found that, upon the respondents­defendants

complying with the conditions as provided in the

agreement(s) to sell, they were required to issue a notice to

the appellant­plaintiff and after receipt of the said notice, the

sale consideration was required to be paid within 30 days

from receipt of the said notice.

23. In appeal, the learned Appellate Court affirmed the

findings of fact recorded by the trial court. It held that the

execution of the agreement to sell (Ex. PW1/3) and the

16 receipt of earnest money of Rs. 1,50,000/­ was not disputed.

It found that, as per the terms of the agreement(s) to sell, it

was for the respondents­defendants No. 1 to 4 to get the

revenue records corrected and they had also agreed to obtain

the ITC Certificate and to send a copy of the same to the

vendee. The learned Appellate Court held that even oral

evidence to controvert these conditions incorporated in the

written statement cannot be led in view of Section 92 of the

Evidence Act, 1872. It held that the self­serving oral

statement of Ajit Singh, defendant No. 7 was not sufficient to

controvert the terms and conditions incorporated in the

agreement(s) to sell. Insofar as the argument that the suit

for specific performance was filed without the correction of

revenue records, the learned Appellate Court found that

since the respondents­defendants were intending to alienate

the suit property, the appellant­plaintiff was justified in filing

the suit.

24. The learned Appellate Court came to a specific

finding that none of the respondents­defendants No. 1 to 4,

who were signatories to the agreement, had entered into the

witness box. Though Ajit Singh, defendant No. 7, who is the

17 husband of defendant No. 3, had appeared as a witness, the

Appellate Court found that he was not a good substitute for

defendants No. 1 to 4, who, being vendors, were the material

witnesses. The learned Appellate Court, relying on the

judgment of this Court in the case of Vidhyadhar v.

Manikrao and Another7, held that on account of non­

examination of any of the vendors, an adverse inference

could be drawn against them.

25. The learned Single Judge of the High Court, vide the

impugned judgment, has held that the appellant­plaintiff

could seek specific performance of the contract only after the

revenue record was corrected. It held that the suit for

correction of the revenue record was filed by the

respondents­defendants on 4th June 1986 and the same was

decreed on 22nd December 2006. It therefore held that the

suit of the appellant­plaintiff which was filed on 17 th October

1989 was not tenable. The learned Single Judge therefore

allowed the appeals and held that, in view of the judgment of

this Court in the case of Nirmala Anand (supra), if the

7 (1999) 3 SCC 573 18 plaintiff desires to get the sale deed executed, he is required

to pay the present prevalent market rate of the suit property.

26. We find that the learned Single Judge of the High

Court has erred in interfering with the concurrent findings of

fact recorded by the trial court as well as by the Appellate

Court. The trial court as well as the Appellate Court had

specifically found on the basis of the evidence that, though

as per the terms and conditions of the agreement(s) to sell,

the sale deed was to be executed only after the respondents­

defendants obtained the ITC Certificate and got the revenue

records corrected, the appellant­plaintiff was compelled to file

the suit since the respondents­defendants were trying to

alienate the suit property.

27. It is pertinent to note that the appellant­plaintiff has

specifically averred that, though the respondents­defendants

had neither obtained the ITC Certificate nor had the revenue

records corrected, they were threatening to dispossess him

and create 3rd party rights over the suit property. In these

circumstances, the appellant­plaintiff was constrained to file

the suit. In the written statement, the respondents­

defendants have specifically stated that they were entitled to

19 create 3rd party rights. In this factual situation, the

concurrent findings of the trial court and the Appellate Court

that the appellant­plaintiff was justified in filing the suit

could not have been faulted with.

28. The respondents­defendants cannot be permitted to

blow hot and cold at the same time. On one hand, they

contended that the suit could not have been filed without

getting the ITC Certificate and correction of revenue records,

whereas on the other hand, they assert their right to alienate

the suit property.

29. Shri Singh has heavily relied on the judgment of this

Court in the case of Kulwant Kaur and Others (supra). No

doubt that where it is found that the findings of the trial

court and the Appellate Court are vitiated on wrong test and

on the basis of assumptions and conjectures and resultantly,

there is an element of perversity, the High Court will be

within its jurisdiction to deal with the same. However, this

can be permitted only in the event where such a fact is

brought to light by the High Court explicitly and the

judgment should also be categorical as to the issue of

perversity vis­à­vis the concept of justice. 20

30. In the present case, apart from there being no

perversity in the concurrent findings of fact, there is not even

an observation in the judgment of the High Court to that

effect. The judgment of the learned Single Judge of the High

Court also does not discuss the issue of perversity vis­à­vis

the concept of justice. As such, the said judgment, in our

view, is not applicable to the facts of the present case.

31. Insofar as the reliance placed by the respondents­

defendants on the judgment of this Court in the case of

Nirmala Anand (supra) is concerned, the said judgment,

rather than supporting the case of the respondents­

defendants, would support the case of the appellant­plaintiff.

In the said case, the suit filed by the appellant was partly

decreed, thereby only awarding damages. The same was

upheld by the Division Bench of the High Court. The defence

of the defendant therein was with regard to impossibility of

performance of the agreement entered into by the appellant

with the respondents No. 1 and 2. In the said case, this

Court found that the respondents­defendants could not be

solely blamed for delay inasmuch as the completion of the

building was dependent upon certain acts that were to be

21 done by the Corporation and the Government. In this

background, this Court directed an additional amount to be

paid by the appellant­plaintiff to the respondents­defendants

to get the sale deed executed in her favour.

32. In the present case, it would be seen that out of an

agreed amount of Rs.1,65,000/­, the appellant­plaintiff has

already paid an amount of Rs.1,50,000/­ on or before 23 rd

August 1985. He was already put in possession at the time

of execution of the agreement(s) to sell. The balance sale

consideration that was to be paid was only about 10% of the

total agreed amount. Though the sale deed was to be

executed upon the respondents­defendants getting the ITC

Certificate and getting the revenue records corrected in the

year 1986, in view of their greed since the prices were

escalating, the respondents­defendants had tried to create 3 rd

party rights. In these circumstances, the appellant­plaintiff

was required to file the suit. The respondents­defendants

have also asserted in their written statement that they were

entitled to alienate the suit property. Having accepted the

agreement(s) to sell and the receipt of an amount of Rs.

1,50,000/­ out of the total amount of Rs.1,65,000/­, the

22 respondents­defendants could not have been permitted to

take a contrary stand that on one hand, the suit could not be

filed before the ITC Certificate was obtained and the revenue

records were corrected, and on the other hand that they were

entitled to alienate the suit property.

33. We are of the considered view that the learned Single

Judge of the High Court has erred in interfering with the

concurrent findings of fact arrived at by the trial court and

the Appellate Court upon correct appreciation of

documentary as well as oral evidence.

34. In the result, we pass the following order:

(i) The appeals are allowed;

(ii) The judgment 3rd March 2008 passed by the High

Court in Regular Second Appeal Nos. 1206 and 1207

of 2005 and order dated 10 th April 2008 passed by

the High Court in R.A. No. 19­C of 2008 in R.S.A. No.

1206 of 2005 and R.A. No. 18­C of 2008 in R.S.A. No.

1207 of 2005 are quashed and set aside; and

(iii) The judgments and decrees dated 3rd January 2001

passed by the trial court in RBT 329/90/2000 and

23 dated 8th February 2005 passed by the Appellate

Court in Civil Appeal No. 11 of 2001 are upheld.

35. Pending application(s), if any, shall stand disposed of

in the above terms. No order as to costs.

…..….......................J. [B.R. GAVAI]

…….......................J. [C.T. RAVIKUMAR]

NEW DELHI;

SEPTEMBER 13, 2022.

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