- 1 - NC: 2025:KHC-K:1479 RFA No. 200163 of 2019 IN THE HIGH COURT OF KARNATAKA, KALABURAGI BENCH DATED THIS THE 6TH DAY OF MARCH, 2025 BEFORE THE HON'BLE MR. JUSTICE ANANT RAMANATH HEGDE REGULAR FIRST APPEAL NO. 200163 OF 2019 (SP-) BETWEEN: SRI. MALLAPPA S/O SATAPPA HULASUR, AGED ABOUT: 56 YEARS, OCC: AGRICULTURE, R/O: MANNUR, TQ: SINDAGI, DIST: VIJYAPUR – 586 101. …APPELLANT (BY SRI S.S.MAMADAPUR, ADVOCATE) AND: 1. SRI. IRAPPA S/O MANAPPA BADAGER, AGED ABOUT: 28 YEARS, OCC: AGRI & BUSINESS R/O: MANNUR, TQ:SINDAGI DIST: VIJAYAPUR – 586 101. 1A. SMT. ANJALI W/O IRANNA BADAGER AGE: MAJOR, OCC: HOUSEHOLD WORK, 1b. SRI SRINIVAS S/O IRANNA BADAGER AGE: MAJOR, V/O DATED 30.05.2024 SINCE DECEASED BY LRS R1 (A) TO R1 (C) Digitally signed by BASALINGAPPA SHIVARAJ DHUTTARGAON Location: HIGH COURT OF KARNATAKA - 2 - NC: 2025:KHC-K:1479 RFA No. 200163 of 2019 OCC: NIL, 1c. VAISHNAVI D/O IRANNA BADAGER AGE: MAJOR, OCC: NIL, ALL ARE R/O: MANNUR, TQ: SINDAGI, DIST: VIJAYAPURA. …RESPONDENTS (BY SMT. RATNA N.SHIVAYOGIMATH, R1(A); R1(B) AND R1(C) – ABSENT) THIS REGULAR FIRST APPEAL IS FILED UNDER SECTION 96 OF THE CODE OF CIVIL PROCEDURE, PRAYING TO ALLOW THE APPEAL BY SETTING ASIDE THE JUDGMENT AND DECREE DATED 27.08.2018 PASSED BY THE HON’BLE ADDITIONAL SENIOR CIVIL JUDGE AND J.M.F.C., SINDAGI, IN O.S.NO.96/2017, IN THE INTEREST OF JUSTICE. THIS REGULAR FIRST APPEAL, COMING ON FOR ADMISSION, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE ANANT RAMANATH HEGDE ORAL JUDGMENT (PER: HON'BLE MR. JUSTICE ANANT RAMANATH HEGDE) 1. Heard the learned counsel for the appellant, as well as learned counsel appearing for the respondents. 2. This appeal is against a decree for refund of earnest money of Rs.12,50,000/- with interest at the rate of 18% per annum, from the date of agreement for sale, till the - 3 - NC: 2025:KHC-K:1479 RFA No. 200163 of 2019 repayment. The relief of specific performance sought for by the plaintiff is rejected on the premise that, the plaintiff has not established readiness and willingness to perform his part of contract. 3. The appellant/defendant is before this Court contending that, the decree passed is an ex-parte decree and the same has to be set aside and the matter has to be remanded to the trial Court. 4. Learned counsel for the appellant/defendant would also submit that, there was no agreement for specific performance, but there was only a loan transaction between the plaintiff and the defendant, and as a security for the said transaction, the defendant has executed agreement of sale. Thus, he would contend that, the decree for refund of earnest money has to be set aside. 5. Learned counsel for the plaintiff/respondents (L.Rs of original defendant), on the other hand would contend that, the agreement for sale is duly registered. Despite service of summons, the defendant did not appear - 4 - NC: 2025:KHC-K:1479 RFA No. 200163 of 2019 and contest the matter and no case is made out to remand the matter on account of default on the part of defendant to contest the matter. 6. It is also her contention that, when the defendant raises a defence that the said transaction is not a sale transaction, but only a loan transaction, and the agreement was entered into as a security for the loan, the defendant unless makes out a case that he repaid the loan amount, he is not entitled to make a prayer to remand the matter to the trial Court. 7. This Court has considered the contentions raised at the Bar and perused the records. 8. Following point arises for consideration: “Whether the defendant/appellant has made out a case to remand the matter to the trial Court for fresh consideration?” 9. As already noticed, decree for specific performance is declined and the trial Court has granted a decree for refund of earnest money with interest at the rate - 5 - NC: 2025:KHC-K:1479 RFA No. 200163 of 2019 of 18% per annum from the date of agreement, till repayment. 10. Now the defendant is before this Court, raising a contention that, the transaction was not a sale transaction, but a loan transaction. It is noticed that, the agreement for sale is duly registered and the agreement for sale would also reveal that, Rs.12,50,000/- is paid to the defendant. The defendant has neither filed written statement nor led evidence, despite service of notice. Even before this Court, the defendant has not raised the contention that, he has repaid the loan amount. 11. Under the circumstances, this Court does not find any justifiable ground to remand the matter to the trial Court, when the trial Court has passed a decree based on the evidence i.e. registered agreement for sale. However, it is noticed that, the trial Court has also passed a decree for interest at the rate of 18% per annum. 12. The agreement is of the year 2013. Keeping this aspect in the mind, this Court is of the view that, the interest - 6 - NC: 2025:KHC-K:1479 RFA No. 200163 of 2019 at the rate of 18% is higher as rightly argued by the learned counsel for the appellant. Hence, the following order: ORDER (i) The appeal is allowed in-part; (ii) The impugned Judgment and decree passed by the trial Court are modified, reducing interest from 18% per annum to 12% per annum from the date of agreement, till realization of the entire amount. (iii) The decree for refund of Rs.12,50,000/- is sustained. (iv) No order as to costs. Sd/- (ANANT RAMANATH HEGDE) JUDGE SVH List No.: 1 Sl No.: 34