- 1 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 13TH DAY OF AUGUST, 2025 BEFORE THE HON'BLE MR. JUSTICE E.S.INDIRESH REGULAR SECOND APPEAL NO.2615 OF 2017 (SP) BETWEEN: H.M. KRISHNAMURTHY S/O MUNIYAPPA REDDY AGED ABOUT 45 YEARS HALANAYKANHALLI SARJAPURA ROAD CARMELARAM POST BENGALURU - 560035. …APPELLANT (BY SRI. G.V. SHASHI KUMAR, ADVOCATE) AND: SMT. V. SHANTHI W/O SRI. VELYUTHAM AGED ABOUT 40 YEARS R/AT NO.1782/2 25TH MAIN, 9TH BLOCK JAYANAGAR BENGALURU - 560069. NOW AT PRESENT NO.1096, 35TH 'D' CROSS 4TH 'T' BLOCK, 26TH MAIN ROAD JAYANAGAR, BENGALURU - 560069. ... RESPONDENT (BY SRI. CHANDRESHAKARA REDDY M.V., ADVOCATE) Digitally signed by SHARMA ANAND CHAYA Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 THIS REGULAR SECOND APPEAL IS FILED UNDER SECTION 100 R/W ORDER XLI RULE 1 OF CODE OF CIVIL PROCEDURE, AGAINST THE JUDGMENT & DECREE DATED 16.10.2017 PASSED IN R.A.No.237/2013 ON THE FILE OF THE I ADDITIONAL DISTRICT AND SESSIONS JUDGE, BENGALURU RURAL DISTRICT, BENGALURU DISMISSING THE APPEAL FILED AGAINST THE JUDGMENT AND DECREE DATED 24.08.2013 PASSED IN O.S. NO.232 OF 2005 ON THE FILE OF THE I ADDITIONAL SENIOR CIVIL JUDGE, BENGALURU RURAL DISTRICT, BENGALURU. THIS REGULAR SECOND APPEAL HAVING BEEN RESERVED FOR ORDERS, COMING ON FOR PRONOUNCEMENT THIS DAY, E.S. INDIRESH J., DELIVERED THE FOLLOWING: CORAM: HON'BLE MR. JUSTICE E.S. INDIRESH CAV JUDGMENT 1. This appeal is filed by the plaintiff challenging the judgment and decree dated 16.10.2017 passed in RA.No.237/2013 on the file of the I Addl. District and Sessions Judge, Bengaluru Rural District, Bengaluru, dismissing the appeal and confirming the judgment and decree dated 24.08.2013 passed in O.S.No.232/2005 on - 3 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 the file of the I Addl. Senior Civil Judge, Bengaluru Rural District, Bengaluru, dismissing the suit of the plaintiff. 2. For the sake of convenience, the parties in this appeal shall be referred to in terms of their status and ranking before the trial Court. 3. The plaint averments are that, the defendant is the owner of the suit schedule property and as such, entered into an Agreement of Sale on 11.08.2003, agreeing to sell the suit schedule property in favour of the plaintiff for total consideration of Rs.96,000/-. Pursuant to the same, plaintiff has paid advance amount of Rs.50,000/- and thereafter, paid Rs.20,000/- on 22.10.2003 by way of cash and Rs.10,000/- through cheque on 23.10.2003. It is the case of the plaintiff that, plaintiff has paid Rs.80,000/- towards sale consideration to the defendant and agreeing to pay the balance consideration of Rs.16,000/- at the time of execution of the registered Sale Deed. It is also stated in the Agreement of Sale that, the entire transaction has to be completed within three months from - 4 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 the date of the execution of the sale agreement. It is further averred in the plaint that, the plaintiff was ready and willing to perform his obligation under the Agreement of Sale, however, the defendant had issued legal notice dated 07.07.2004, intimating the plaintiff that the said agreement dated 11.08.2003 is a general power of attorney, and not a sale agreement. Thereafter, the plaintiff issued a reply dated 10.07.2004, denying the averments in the notice dated 07.07.2004. Hence, the plaintiff has filed O.S.No.232/2005, seeking relief of specific performance of contract. 4. After service of summons, defendant entered appearance and has filed detailed written statement denying the plaint averments and contended that, the defendant was in need of money and as such offered to sell the suit schedule property. It is also stated that, the cousin of the defendant - Muthuraman, brought the plaintiff for sale transaction and in this regard, the plaintiff and said Muthuraman assured the defendant that, they - 5 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 will get a buyer for good price and accordingly, the defendant has agreed for sale of schedule property and executed the general power of attorney dated 11.08.2003 with the plaintiff and same cannot be construed as an agreement of sale. It is further stated in the written statement that the plaintiff has issued cheque dated 17.10.2003 for a sum of Rs.30,000/- which came to be dishonoured and thereafter, the plaintiff has paid Rs.10,000/- through cheque and accordingly, the defendant denied the averment of payment of Rs.50,000/- and Rs.20,000/- through cash. Hence, the defendant sought for dismissal of the suit. 5. On the basis of the rival pleadings, the Trial Court has formulated issues for its consideration. In order to establish their case, plaintiff got himself examined as P.W.1 and got examined one more witness as P.W.2 and got marked nine documents as Exs.P1 to P9. On the other hand, defendant examined herself as D.W.1 and produced two documents as Exs.D1 and D2. - 6 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 6. The Trial Court, after considering the material on record, by its judgment and decree dated 24.08.2013, dismissed the suit of the plaintiff and being aggrieved by the same, the plaintiff has preferred Regular Appeal in R.A.No.237/2013 on the file of the First Appellate Court. The said appeal was resisted by the defendant. The First Appellate Court, after re-appreciating the facts on record, by its judgment and decree dated 16.10.2017, dismissed the appeal, consequently, confirmed the Judgment and Decree passed by the Trial Court in O.S.No.232/2005. 7. Being aggrieved by the judgment and decree passed by the Courts below, the appellant/plaintiff has preferred this Regular Second Appeal under Section 100 of CPC. 8. This Court, vide order dated 11.09.2023, formulated the following substantial questions of law: 1. "Whether both the courts have committed an error in dismissing the suit for specific performance without coming to the conclusion whether there - 7 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 exists sale agreement or it is a transaction of General Power of Attorney ? 2. Whether both the Courts have committed an error in not considering passing of sale consideration on account of sale transaction as contended by the plaintiff ? 3. Whether both the courts committed an error in not exercising the discretion as under section 20 of the Specific Relief Act if the said transaction is of sale agreement ?" 9. I have heard Sri. G.V. Shashi Kumar, learned counsel for the appellant/ plaintiff and Sri. Chandrashekara Reddy M.V., learned counsel for the respondent/defendant. 10. Sri. G.V. Shashi Kumar, learned counsel for the appellant contended that, both the Courts below have committed an error in considering the Agreement of Sale dated 11.08.2003 as the general power of attorney and further ignored the payment of cash and acceptance of the cheque by the defendant and accordingly, sought for - 8 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 interference of this Court. It is also argued by the learned counsel for the appellant that the plaintiff has proved the execution of Agreement of Sale by examining P.W.2 - witness to Ex.P1 and the said aspect of the matter was not considered by both the Courts below and accordingly, sought for interference of this Court. Learned counsel for the appellant places reliance on the Judgment of the Hon'ble Supreme Court in the case of BASAVARAJ Vs. PADMAVATHI AND ANOTHER reported in (2023) 4 SCC 239 and argued that, the plaintiff has established readiness and willingness to complete the entire transaction and has paid more than 80% of the sale consideration amount and accordingly, sought for interference of this Court. 11. Per contra, Sri. Chandrashekara Reddy M.V., learned counsel appearing for the respondent/defendant submitted by referring to Ex.D2, that the reply notice dated 10.07.2004 issued by the learned counsel for the plaintiff and argued that the defendant has denied the - 9 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 execution of the sale agreement dated 11.08.2003 and further the plaintiff has not taken any steps even to furnish the true copy of the sale agreement dated 11.08.2003 to the defendant and therefore, denied the execution of the Agreement of Sale. It is also argued by the learned counsel for the respondent that the plaintiff has not examined one Yogesh to prove the execution of the Agreement of Sale and accordingly, sought for dismissal of the appeal. It is the categorical submission of the learned counsel for the defendant that, at the time execution of Ex.P1, P.W.2 was not present and in this regard, refers to the evidence of P.W.2 and argued that, signature of the defendant was taken in the absence of P.W.2, on Ex.P1 and therefore, the plaintiff has not proved the execution of Agreement of Sale at Ex.P1 and accordingly, sought for dismissal of the appeal. 12. In order to buttress his arguments, learned counsel for the respondent places reliance on the Judgment of the Hon'ble Supreme Court in the case of BABU LAL Vs. - 10 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 HAZARI LAL KISHORI LAL AND OTHERS reported in (1982)1 SCC 525 and in the case of K.R. SURESH Vs. R. POORNIMA, reported in AIROnline 2025 SC 371. 13. Heard the learned counsel appearing for both the parties and perused the material on record. This Court, in RSA No.881/2009 remanded the matter to the Trial Court for fresh consideration. Accordingly, the suit was taken up for fresh consideration, by the Trial Court. 14. It is the case of the plaintiff that, plaintiff has entered into an agreement of sale on 11.08.2003 (Ex.P1), with the defendant agreeing to sell the suit property for total consideration of Rs.96,000/-. It is the case of plaintiff that plaintiff has paid Rs.50,000/- on the date of agreement and thereafter paid a sum of Rs.20,000/- on 22.10.2003 by way of cash and Rs.10,000/- through cheque on 23.10.2003. It is the case of the plaintiff that defendant has caused legal notice dated 07.07.2004 (Ex.P7) and same was replied by the plaintiff on 10.07.2004 (Ex.P8) and thereafter, notice dated 20.10.2004 was issued by the - 11 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 defendant as per Ex.P9. It is the specific case of the defendant denying the execution of the agreement of sale and further contended that, the agreement at Ex.P1 is a general power of attorney executed in favour of the plaintiff. It is not disputed from the evidence of DW1 that the defendant was intended to sell the suit schedule property. It is also forthcoming from the evidence of PW2 - H.N. Purushothama Reddy, who was a witness to the agreement of sale at Ex.P1 with regard to due execution of the sale agreement. The defendant has signed the document at Ex.P1 in English language. Perusal of Ex.P7 - legal notice dated 07.07.2004 issued by the defendant would indicate that the defendant has agreed to execution of the Ex.P1, however, taken a plea that the said document is a general power of attorney, not a sale agreement. The said notice was replied as per Ex.P8, stating about the sale of the schedule property. It is also forthcoming from the legal notice dated 20.10.2004 (Ex.P9) issued by the defendant refers to the execution of - 12 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 the agreement at Ex.P1. There is no rejoinder to Ex.P9. It is also deposed by D.W.1 that the defendant came in contact with the plaintiff through her cousin, Muthuraman and the said Muthuraman has not been examined by the defendant about execution of Ex.P1 as power of attorney and on the other hand, said Muthuraman is witness No.1 to the agreement of sale at Ex.P1. In the background of these aspects, the plaintiff has paid Rs.10,000/- through cheque on 23.10.2003 to the defendant and same was realised by the defendant. In this regard, it is relevant to cite the Judgment of Hon'ble Supreme Court in the case of SANGITA SINHA vs. BHAWANA BHARDWAJ AND OTHERS reported in AIR 2025 SC 1806, wherein paragraph Nos.21 to 24 read as under: " 21. This Court is also of the view that the act of the Respondent No.1- buyer in encashing the demand drafts leads to an irresistible conclusion that the agreement in question stood cancelled. 22. The contention of the learned counsel for the Respondent No. 1- buyer that the Agreement to Sell - 13 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 dated 25th January 2008 could not have been cancelled unilaterally is contrary to facts as the letter dated 07th February 2008 along with the refund of the demand drafts and two post-dated cheques was nothing but repudiation of the Agreement to Sell dated 25th January 2008 by the seller and the encashment of the demand drafts was acceptance of such repudiation by the Respondent No.1-buyer, leading to cancellation of the Agreement to Sell dated 25th January 2008. 23. The contention that the demand drafts were encashed under protest is misconceived on facts as there is nothing on record to show that the demand drafts were encashed under protest. In fact, PW-2, who is the husband of the Respondent No.1-buyer, has deposed that upon receipt of the demand drafts and cheques, the Respondent No.1-buyer had not issued any letter to the seller stating that the amounts received by them were less than the earnest money paid by them. 24. This Court further finds that the seller had admittedly issued a letter dated 7th February 2008 cancelling the Agreement to Sell dated 25th January 2008, prior to the filing of the subject suit on 5th May 2008. Even though the demand drafts enclosed with the letter dated 07th February, 2008 were - 14 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 subsequently encashed in July, 2008, yet this Court is of the view that it was incumbent upon the Respondent No.1-buyer to seek a declaratory relief that the said cancellation is bad in law and not binding on parties for the reason that existence of a valid agreement is sine qua non for the grant of relief of specific performance." (emphasis supplied) 15. Following the declaration of law made by the Hon'ble Supreme Court in the above case, as the defendant had realised the cheque issued by the plaintiff, which is undisputed by the parties and the said aspect would make it clear that the defendant has understood the recitals in the agreement of sale and therefore, contentions raised by learned counsel appearing for respondent cannot be accepted. Though the learned counsel appearing for the respondent refers to Ex.P9 - Notice dated 20.10.2004 and Ex.P7 - Notice dated 07.07.2004 addressed by the defendant to the plaintiff, though the defendant has urged that the agreement at Ex.P1 is not an agreement of sale - 15 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 but an unregistered power of attorney, the said contentions urged by the learned counsel for the defendant cannot be accepted as the defendant has admitted in the cross-examination dated 05.04.2012 that, she has requested her brother Muthuraman to sell the suit property and her brother had brought the plaintiff in contact with the defendant. It is also to be noted that, the defendant has published in the daily newspaper regarding sale of the suit property and admits her signature on the agreement of sale ( Ex.P1). 16. At this juncture, it is relevant to cite the Judgment of the Hon'ble Supreme Court in the case of GRASIM INDUSTRIES LIMITED AND ANOTHER Vs. AGARWAL STEEL reported in (2010) 1 SCC 83. Paragraph 6 therein, reads as under: "6. In our opinion, when a person signs a document, there is a presumption, unless there is proof of force or fraud, that he has read the document properly and understood it and only then he has affixed his signatures thereon, otherwise no signature on a - 16 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 document can ever be accepted. In particular, businessmen, being careful people (since their money is involved) would have ordinarily read and understood a document before signing it. Hence the presumption would be even stronger in their case. There is no allegation of force or fraud in this case. Hence it is difficult to accept the contention of the respondent while admitting that the document Ex.D- 8 bears his signatures that it was signed under some mistake. We cannot agree with the view of the High Court on this question. On this ground alone, we allow this appeal, set aside the impugned judgment of the High Court and remand the matter to the High Court for expeditious disposal in accordance with law." 17. Following the declaration of law referred to above, as the defendant admits her signature on the Agreement of Sale - Ex.P1 and the transaction is for sale of schedule property, I am of the view that, the Judgments referred to by the learned counsel appearing for the respondent are not applicable to the facts on record. 18. It is pertinent to mention here that plaintiff has examined P.W.2 who is a witness to the sale agreement at - 17 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 Ex.P1 and another witness to the agreement is Muthuraman - brother of the defendant. It is also pertinent to mention here that, the plaintiff has issued cheque dated 17.10.2003 at Ex.D1 as a part of sale consideration and the said cheque was dishonoured and thereafter, the plaintiff has issued another cheque for a sum of Rs.10,000/- in favour of the defendant which came to be realised by the defendant which makes it clear that the plaintiff has proved the execution of agreement of sale executed in his favour by the defendant. It is pertinent to mention here that, for the reasons best known to the defendant, the defendant has not chosen to examine her cousin brother Muthuraman who is also one of the witnesses to the agreement of sale at Ex.P1 and therefore, an adverse inference has to be made against the defendant and to conclude that, parties had entered into an agreement of sale as per Ex.P1. 19. Nextly, after re-appreciating the evidence of P.W.2, who has deposed about the execution of the agreement of - 18 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 sale at Ex.P1 and Rs.50,000/- was paid to the defendant as on the date of execution of Ex.P1 and that apart, Rs.20,000/- in cash and Rs.10,000/- through cheque was paid to the defendant in his presence and the said aspect would make it clear that plaintiff has proved Ex.P1. Taking into consideration the appreciation of evidence on record as stated above, I am of the view that, both the Courts below have committed an error in dismissing the suit of the plaintiff and proper appreciation of evidence has not been made by both the Courts below and the Trial Court has ignored the cross-examination of P.W.2 and D.W.1 and accordingly, dismissed the suit erroneously and therefore, the finding recorded by the Trial Court requires to be interfered with, in this appeal. It is also to be noted that the defendant has admitted her signature on Ex.P1, which is in English language and therefore, the plea raised by the defendant that the said document is a general power of attorney cannot be accepted in the light of the observation made above by looking into the evidence of - 19 - HC-KAR NC: 2025:KHC:31413 RSA No. 2615 of 2017 P.W.2. Accordingly, the substantial question of law referred to above, favours the plaintiff. 20. In the result, I pass the following: ORDER (i) The Regular Second Appeal is allowed. (ii) The Judgment and Decree dated 16.10.2017 passed in R.A.No.237/2013 on the file of the I Addl. District and Sessions Judge, Bengaluru Rural District, is hereby set aside. (iii) The Judgment and Decree dated 24.08.2013 passed in O.S.No.232/2005 on the file of the I Addl. Senior Civil Judge, Bengaluru Rural District, Bengaluru, is hereby set aside. (iii) Suit in O.S.No.232/2005 is hereby decreed. Registry is directed to draw Decree accordingly. SD/- (E.S.INDIRESH) JUDGE sacS List No.: 1 Sl No.: 48