- 1 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 4TH DAY OF FEBRUARY, 2025 PRESENT THE HON'BLE MR. JUSTICE ASHOK S. KINAGI AND THE HON'BLE MR. JUSTICE UMESH M ADIGA REGULAR FIRST APPEAL NO. 100288 OF 2020 (SP) BETWEEN: BHARATARAJ S/O SHANTAPPA HAJERI AGE: 55 YEARS, OCC: AGRICULTURE & BUSINESS, R/O: M.G. ROAD, TALUK & DIST: HAVERI. …APPELLANT (BY SRI. A.P. MURARI, ADV) AND: PRABHU S/O CHANNAVEERAPPA JOGUR AGE: 48 YEARS, OCC: AGRICULTURE R/O: BASAVESHWARA NAGAR TALUK & DIST: HAVERI. …RESPONDENT (BY SRI. SURESH N KINI, ADV) THIS RFA IS FILED UNDER SEC. 96 R/W ORDER XLI RULE 1 OF CPC., AGAINST THE JUDGMENT AND DECREE DTD.04.03.2020 PASSED IN O.S.NO.95/2014 ON THE FILE OF THE ADDITIONAL SENIOR CIVIL JUDGE, HAVERI, DISMISSING THE SUIT FILED FOR SPECIFIC PERFORMANCE OF CONTRACT. THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: THE HON'BLE MR. JUSTICE ASHOK S. KINAGI AND THE HON'BLE MR. JUSTICE UMESH M ADIGA MOHANKUMAR B SHELAR Digitally signed by MOHANKUMAR B SHELAR Date: 2025.03.01 11:14:52 +0530 - 2 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 ORAL JUDGMENT (PER: HON'BLE MR. JUSTICE ASHOK S. KINAGI) This Regular First Appeal is filed by the appellant challenging the judgment and decree dated 04.03.2020, passed in O.S.No.95/2014 by the Additional Senior Civil Judge and JMFC, Haveri. 2. For convenience, parties are referred to based on their rankings before the trial Court. Appellant was the plaintiff, and respondent was the defendant. 3. Brief facts leading rise to filing of this appeal are as follows: Plaintiff filed a suit against the defendant for specific performance of contract. It is the case of the plaintiff that the defendant is the absolute owner of the suit schedule properties. He agreed to sell the suit schedule properties for total consideration amount of Rs.22,33,505/-, for valuable consideration of Rs.3,80,101/- per acre. The plaintiff, agreed to give Rs.8,00,000/- as part payment to the defendant, out of the total sale consideration amount. - 3 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 The terms and conditions in respect of agreement of sale were concluded. After receiving the advance sale consideration of Rs.8.00 lakhs the said agreement of sale was executed on 16.09.2010. As per the terms and conditions of sale agreement, defendant agreed to execute a registered sale deed in respect of the suit properties in favour of the plaintiff, after rectifying the records of the suit lands, by clearing the loans on or before 15.03.2011. After entering into the agreement of sale dated 10.09.2010, the defendant has not come forward to execute the registered sale deed. The plaintiff requested the defendant to receive the balance consideration amount and execute a registered sale deed. The defendant on one or other reasons postponed the execution of sale deed. The plaintiff got issued a legal notice dated 02.02.2011, calling upon the defendant to receive the balance consideration amount and execute a registered sale deed. The defendant, replied to the legal notice on 16.02.2011, denying the contents of - 4 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 the said legal notice and also execution of the sale agreement, by receiving the part of the sale consideration amount. It is contended that plaintiff was/is always ready and willing to perform his part of contract, but the defendant was not ready to perform his part of contract. The defendant has committed a breach of contract. Hence, a cause of action arose for the plaintiff to file a suit for specific performance of the contract. Accordingly, prays to decree the suit. 4. Defendant filed a written statement denying the averments made in the plaint and denied the execution of sale agreement and receiving of Rs.8 lakhs as an earnest money. It is contended that as on the date of the execution of alleged sale agreement the defendant is not the owner of the suit properties. The alleged sale agreement is sham and bogus. It is contended that defendant had purchased the suit property bearing R.S.No.204/3, measuring 3 acres 6 guntas, from its owner Moulasab Doddamani on 18.02.2011, under a registered sale deed and paid the entire consideration amount out of - 5 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 income of the joint family. The suit properties are the joint family property of the defendant and his family members, and defendant is not an absolute owner of the suit properties. It is contended that plaintiff and his friend Bankapur together, are running money lending business without obtaining any license. Defendant had obtained the loan through Bankapur and at that time the plaintiff, and the Bankapur had obtained the signature of the defendant on the blank stamp paper, and they have misused the blank stamp paper, by creating an agreement to sell. Though, the defendant replied on 16.02.2011, to the legal notice dated 02.02.2011, the plaintiff did not choose to file a suit, immediately after receiving the said reply. The suit filed by the plaintiff is barred by limitation. Hence, prays to dismiss the suit. 5. The trial Court based on the pleading of the parties, framed the following issues: ISSUES 1. Whether plaintiff proves that, defendant had executed an agreement of sale in his favour on 16.09.2010 in respect of the suit - 6 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 properties for 22,33,505/- and received earnest money of 8,00,000/-? 2. Whether plaintiff proves that, he is ready and willing to perform his part of contract since inception? 3. Whether defendant proves that, alleged agreement of sale is Sham and bogus? 4. Whether defendant proves plaintiff and his friend Bankapur had obtained his signature on the blank stamp paper worth 200/- for the purpose of security for the loan availed by him to the tune of *50,000/-? 5. Whether suit is barred by law of limitation? 6. Whether defendant prove plaintiff is liable to pay compensation to him as per Section 95 of Code of Civil Procedure, 1908? 7. Whether plaintiff is entitled for the reliefs as sought for? 8. What order or decree? 6. The plaintiff, to prove his case, examined himself as PW-1 and examined 3 witnesses as PW-2 to PW-4 and marked 8 documents as Ex.P1 to Ex.P8. In rebuttal, the defendant was examined as DW-1 and marked two documents as Ex.D.1 and D.2. The trial Court, after recording the evidence, hearing on both sides, and on the assessment of oral and documentary evidence, answered issue Nos.1, 2, 6 and 7 in the negative, issue - 7 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 No.3 to 5 in the affirmative and issue No.8 as per the final order. The suit of the plaintiff was dismissed, vide judgment dated 04.03.2020. The plaintiff aggrieved by the judgment and decree passed in O.S.No.95/2014, filed this Regular First Appeal. 7. Heard the learned counsel for the plaintiff and the learned counsel for the defendant. 8. Learned counsel for the plaintiff submits that the defendant executed a sale agreement, agreeing to sell the suit schedule properties for consideration of Rs.3,80,101/- per acre, and the plaintiff had paid Rs.8 lakhs to the defendant towards the earnest money. He submits that to prove the contents of Ex.P.8, the plaintiff examined PWs -2 and 3. He also submits that the defendant, admitted his signature on Ex.P.8. He further submits that the trial Court has lost the sight of principle of 'feeding the estoppel', as provided under Section 43 of the Transfer of Property Act. He also submits that the trial Court has committed an error in recording the finding that - 8 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 the plaintiff was/is not ready and willing to perform his part of contract, since inception. The trial Court has committed an error in recording the finding that the plaintiff and his friend Bankapur obtained the defendant’s signature on blank stamp paper worth Rs.200/- for the purpose of security of the loan availed by him to the tune of Rs.50,000/- and the suit filed by the plaintiff is barred by limitation. Hence, on these grounds he prays that the impugned judgment and decree passed by the trial Court is arbitrary, erroneous and the same is liable to be set aside. Accordingly, prays to allow the appeal. 9. Per contra, learned counsel for the defendant submits that his friend Bankapur and plaintiff obtained the signature of the defendant on the blank stamp paper, for the purpose of security for the loan availed by him to the tune of Rs.50,000/-. The plaintiff had misused the blank stamp paper, and created the alleged sale agreement. He submits that the defendant never received the earnest money of Rs.8 lakhs as alleged in the sale agreement. He - 9 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 submits that the defendant never agreed to sell the suit schedule properties, in favour of plaintiff at any point of time. Though the time was the essence of contract, the plaintiff issued a legal notice on 02.02.2011, where, plaintiff had to pay the balance sale consideration amount, within 15.03.2011, but, the plaintiff did not pay the balance consideration amount. 10. The defendant had replied to the legal notice on 16.02.2011, denying the execution of sale agreement, but the plaintiff did not chose to file a suit immediately after the receipt of said reply notice. The plaintiff filed a suit, on 09.05.2014 after the lapse of three years, from the date of reply notice. The suit filed by the plaintiff is barred by limitation. Hence the trial Court was justified in passing the impugned judgment. Accordingly, prays to dismiss the appeal. 11. Perused the records, and considered the submissions of the learned counsel for the parties. - 10 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 12. The point that arises for our consideration are as follows: 1) Whether the plaintiff proves that the defendant executed a sale agreement on 16.09.2010, in respect of the suit schedule properties, for consideration of Rs.22,33,505/- and received the earnest money of Rs.8 lakhs? 2) Whether the plaintiff proves that he was ready and willing to perform his part of contract? 3) Whether the defendant proves that suit filed by the plaintiff is barred by limitation? 4) Whether the plaintiff proves that the impugned judgment passed by the trial Court is perverse and arbitrary? 5) What order and decree? Re.para Nos.1 to 3: 13. Points No.1, 2 and 3 are interconnected. Hence, taken together for common discussion, to avoid repetition of facts. 14. The plaintiff, to prove his case, examined himself as PW-1. He reiterated the plaint averments in the examination-in-chief and to prove that the defendant had executed a sale agreement on 16.09.2010, produced the sale agreement, marked as Ex.P.8 and to show that the defendant is the owner of the suit schedule properties, - 11 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 produced the RTC extracts for R.S.No.204/3, marked as Ex.P.1, and for R.S.No.204/4, marked as Ex.P.2, Ex.P.3 is the endorsement, Ex.P.4 is certified copy of the caveat petition No.22/2012, wherein the defendant filed the caveat petition against the plaintiff, anticipating that the plaintiff is likely to file a suit against the defendant. Exs.P.5 to P.7 are the extract of mutation register. 15. During the cross-examination of PW.1, it was suggested that the defendant never executed the sale agreement for consideration of Rs.22,33,505/- and the plaintiff never paid the earnest money of Rs.8 lakhs, and was ready and willing to perform his part of contract. It is also suggested that the plaintiff and his friend Bankapur obtained the signature of the defendant, on the blank stamp paper worth Rs.200/- for the purpose of security for the loan availed by him to the tune of Rs.50,000/-. The said suggestions were denied by PW-1 and further, the plaintiff, examined PW-2 i.e., Subhan Sab Babajan Sab Bankapur and Shivabasappa Doddappa Talawar as PW-3, - 12 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 who are the attesting witnesses to Ex.P.8. They have deposed that the defendant, agreed to sell the suit schedule properties and executed the sale agreement in their presence, on the stamp paper of Rs.200/- and the said sale agreement was drafted by S.F.Wadadannikopa, Advocate and Notary and the defendant received a sum of Rs.8 lakhs from the plaintiff as an advance sale consideration amount. In rebuttal, the defendant, examined himself as DW-1. He has in his evidence, denied the execution of sale agreement, and receiving of advance sale consideration amount of Rs.8 lakhs from the plaintiff. He has deposed that the plaintiff and his friend i.e., PW-2 obtained his signature on the blank stamp paper worth Rs.200/- and got created a sale agreement, and filed a suit for specific performance of contract. He has deposed that the plaintiff got issued a legal notice on 02.02.2011 as per Ex.D.1, and he replied to the legal notice on 16.02.2011 as per Ex.D.2. After replying to the legal notice, the defendant filed a caveat petition as per Ex.P.4 in 2012. The plaintiff has not filed a suit within time. He - 13 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 also deposed that as per the sale agreement the plaintiff had to pay the balance consideration amount, on or before 15.03.2011, but the plaintiff got issued a legal notice on 02.02.2011 and filed a suit on 09.05.2014. Hence, the suit field by the plaintiff is barred by limitation. 16. From the perusal of the evidence of the plaintiff and the defendant, it is noticed that the defendant denied the execution of sale agreement in favour of the plaintiff. The trial Court extracted the examination-in-chief of PWs- 2 and 3, in paragraph No.24 of the impugned judgment, and recorded its finding that PWs-2 and 3 have not at all stated that as per the directions of the defendant, they have put their signature on the sale agreement. They have not at all stated that they had seen the defendant signing or affixing his mark to the sale agreement. Even though they identified the signature of the defendant on the agreement of sale, they have not at all stated that the defendant had put his signature on the agreement of sale in their presence, and they have seen the defendant - 14 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 signing the sale agreement. The trial Court has disbelieved the PW-2 and PW-3, to prove the sale agreement. 17. Further it was elicited during the cross examination of PW-1 that the signature of the defendant is against the 'x' mark, in Ex.P.8 and recorded a finding that the plaintiff has failed to prove that the defendant had executed an agreement of sale on his favour on 16.09.2010 in respect of the suit properties. Further, the plaintiff except producing Ex.P.8, not produced any other documents. To establish the financial capacity of the plaintiff and to show that the plaintiff had a sum of Rs.8 lakhs, as on the date of execution of the alleged sale agreement, no records has been produced. In the presence of the above said evidence, the trial Court was justified, in recording the finding that the plaintiff has failed to prove that defendant has received Rs.8 lakhs, as the earnest money, from the plaintiff. 18. From the perusal of the recital of the sale agreement dated 16.09.2010, it was agreed that the - 15 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 balance consideration amount to be paid, on or before 15.03.2011. Though, the plaintiff has issued a legal notice on 02.02.2011 as per Ex.D.1, the defendant replied to the legal notice on 16.02.2011 and immediately after the reply to the legal notice, filed a caveat petition anticipating that the plaintiff would file a suit for specific performance of contract, but, the plaintiff did not file a suit till 09.05.2014. 19. From considering the recital of sale agreement time was the essence of the contract. The cause of action arose for the plaintiff to file a suit for specific performance of contract from 16.03.2011 and the plaintiff was supposed to file a suit on or before 14.03.2014. Admittedly, the suit was filed on 09.05.2014. Hence, the suit filed by the plaintiff is barred by limitation as per Article 54 of the Limitation Act, as it is not and within 3 years from the date of denial. 20. As observed above, plaintiff has failed to prove the sale agreement and payment of the earnest money of Rs.8 lakhs and the plaintiff was/is always ready and willing - 16 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 to perform his part of contract. The plaintiff has committed the breach of contract. Plaintiff failed to prove the requirements of Section 16 (c) of the Specific Relief Act. In view of the above discussion, we answer points No.1 and 2 in the negative and point No.3 in the affirmative. Re.Point No.4: 21. The trial Court, considering the evidence of the parties, and recital in Ex.P.8, has rightly held that the plaintiff has failed to prove that the defendant executed a sale agreement on 16.09.2010, in respect of the suit properties, and received an earnest money of Rs.8 lakhs and the plaintiff has failed to prove that he was/is always ready and willing to perform his part of contract and the suit filed by the plaintiff is barred by limitation. The trial Court was justified in dismissing the suit of the plaintiff. We do not find any error in the impugned judgment. We concur with the judgment passed by the trial Court. In view of the above discussion, we answer point No.4 in the negative. - 17 - NC: 2025:KHC-D:2239-DB RFA No. 100288 of 2020 Re.para No.5: 22. As we already answered points No.1 to 4 in favour of the defendant, accordingly, we proceed to pass the following: ORDER (i) The Appeal is dismissed. (ii) The Judgment and decree dated 04.03.2020, in O.S No.95/2014, passed by the Additional Senior Civil Judge & JMFC, Haveri, is confirmed. No order as to the cost. Sd/- (ASHOK S. KINAGI) JUDGE Sd/- (UMESH M ADIGA) JUDGE BVK CT: BSB List No.: 1 Sl No.: 15