- 1 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 IN THE HIGH COURT OF KARNATAKA, KALABURAGI BENCH DATED THIS THE 3RD DAY OF MARCH, 2025 BEFORE THE HON'BLE MR. JUSTICE ANANT RAMANATH HEGDE REGULAR SECOND APPEAL NO.200023 OF 2014 (SP) BETWEEN: KALYANI S/O MADAPPA KORE AGE: 59 YEARS, OCC: AGRICULTURE, R/O: ANJUNTAGI, TQ: & DIST: BIJAPUR, BY P.A. HOLDER MALASIDDAPPA S/O SHANKERAPPA MADIVAL, R/O: AFZALPUR, DIST: GULBARGA. …APPELLANT (BY SRI GURUBASAVA C. NAYAK, ADVOCATE FOR SRI RAMCHANDRA K, ADVOCATE) AND: VITHAL S/O BASAVANTAPPA BABALADI AGE: 50 YEARS, OCC: AGRICULTURE, R/O: ANJUNTAGI, TQ: & DIST: BIJAPUR. …RESPONDENT (BY SRI MANVENDRA REDDY AND SRI NARENDRA M. REDDY, ADVOCATES) THIS REGULAR SECOND APPEAL IS FILED UNDER SECTION 100 OF CODE OF CIVIL PROCEDURE, PRAYING TO CALL FOR ENTIRE RECORDS PERTAINING TO THE Digitally signed by BASALINGAPPA SHIVARAJ DHUTTARGAON Location: HIGH COURT OF KARNATAKA - 2 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 PROCEEDINGS IN THE O.S.NO.338/2017 IN THE COURT OF SENIOR CIVIL JUDGE INDI, DATED 14.02.2010 AND THE PROCEEDINGS IN R.A.NO.23/2011 FROM THE FILE OF PRINCIPAL DISTRICT JUDGE AT BIJAPUR DATED 09.12.2013 AND AFTER PERUSING THE RECORDS, SET ASIDE THE JUDGMENT AND DECREE OF THE COURTS BELOW AND DISMISS OF THE SUIT OF THE PLAINTIFF AND ETC. THIS REGULAR SECOND APPEAL COMING ON FOR FINAL HEARING, 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) This appeal is against the divergent finding in a suit for specific performance. The suit for specific performance to enforce registered agreement for sale dated 13.07.2004 is dismissed holding that the agreement for sale is not proved, however the Trial Court concluded that the transaction is a loan transaction and directed the defendant to pay `90,000/- to the plaintiff along with simple interest at the rate of 6% per annum from the date of agreement, till the date of payment. - 3 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 2. The plaintiff aggrieved by the aforementioned judgment and decree in O.S.No.338/2007 on the file of Senior Civil Judge, Indi filed an appeal before the Court of the Principal District Judge, Vijayapura in R.A.No.23/2011. In terms of the impugned judgment and decree, the appeal is allowed and consequently, the suit of the plaintiff is decreed directing the plaintiff to pay Rs.10,000/- within 15 days from the date of the decree and directed the defendant to execute a registered sale-deed within one month. Hence, the defendant in the original suit is before this Court. 3. This appeal was admitted on 14.03.2023 to answer the following substantial questions of law : 1) Whether the First Appellate Court is justified in exercising judicial discretion in favour of the plaintiff while granting the relief of specific performance of agreement of sale ? 2) Whether the judgment of the First Appellate Court is perverse ? - 4 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 4. Learned counsel appearing for the defendant/appellant would contend that the First Appellate Court erred in reversing the discretionary order passed by the Trial Court. It is also urged that the First Appellate Court has ignored the evidence of DW.1 to DW.3 which clearly reveal that the transaction is not a sale transaction but it was a loan transaction where the defendant was asked to execute a document as security for the loan of `1,00,000/- advanced by the plaintiff. Learned counsel would also contend that defendant is ready to repay the entire loan amount along with interest and the judgment and decree passed by the Appellate Court has to be set- aside and the judgment and decree of the Trial Court has to be restored. 5. It is also his further contention that the plaintiff without getting the sale-deed executed in his name got his name in the property records based on the agreement for sale and this itself would suggest that the plaintiff wanted - 5 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 to cheat in the guise of getting the document relating to security for the loan advanced. 6. It is also his further contention that the Trial Court has based its finding on the suggestion by the counsel for the plaintiff in the cross-examination of DW.1 wherein it is suggested that the plaintiff has advanced the loan to the defendant and the defendant did not repay the loan. Thus, he would urge that the appeal be allowed and the suit of the plaintiff be decreed only for refund of the loan amount advanced. 7. Learned counsel appearing for the plaintiff/ respondent on the other hand contend that the agreement is duly registered before the jurisdictional Sub-Registrar. It is his further submission that `90,000/- out of `1,00,000/- which was agreed to be paid was paid to the plaintiff at the time of registration of the agreement and the plaintiff was only required to pay `10,000/- and the agreement did not provide for any time limit for executing the sale-deed. It further contended that witnesses have been examined - 6 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 to prove the agreement for sale and they have withstood the cross-examination. The Trial Court had committed a serious error in interpreting the suggestion by the learned counsel for the plaintiff and came to a wrong conclusion that the transaction is a loan transaction. 8. Learned counsel for the respondent would also contend that the defendant did not enter the witness box to substantiate his contention relating to alleged loan transaction. In the absence of any evidence on behalf of the defendant, the evidence led on behalf of defendant namely the evidence of DW.1 has to be ignored as hearsay evidence. If it is excluded, then the defence raised by the defendant has to be held as not proved and the First Appellate Court was justified in granting the decree for specific performance. 9. Learned counsel would also contend that during the pendency of the appeal the sale-deed is executed in favour of the plaintiff and balance consideration of - 7 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 `10,000/- is deposited before the Court. Thus, he contend that the appeal needs to be dismissed. 10. This Court has considered the contention raised at the Bar and perused the records. 11. The document at Ex.P.1 is the registered agreement for sale dated 13.07.2004. The said document would reveal that the suit property was agreed to be sold for `1,00,000/- and `90,000/- is said to have been paid by the plaintiff to the defendant. The agreement for sale did not stipulate any time limit for payment of balance consideration amount. 12. The suit is filed on 23.07.2007. In the plaint, it is averred that the plaintiff was willing to perform his part of contract eversince the date of agreement for sale and the defendant impliedly refused to execute the sale deed in the year 2007, when the plaintiff’s notice returned as ‘refused’. - 8 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 13. The defendant has taken a defence of total denial and it is his contention that he had borrowed `50,000/- from the plaintiff and the plaintiff agreed to pay `50,000/- towards hand loan and insisted the defendant to execute the security for the said loan transaction and by paying only `50,000/- and shown `90,000/- as the consideration amount which was agreed to be adjusted towards the interest for three years. The defendant has also stated that he was ready to pay back a sum of `50,000/- along with interest. 14. The Trial Court has refused to grant a decree for specific performance on the premise that agreement for sale is not proved. The judgment of the Trial Court is primarily based on the interpretation of the suggestion by the counsel for the plaintiff. The suggestion which reads as under : “ªÁ¢ ªÀÄvÀÄÛ ¥ÀæwªÁ¢ £ÀqÀÄªÉ `50,000/- ¸À®ÄªÁV §rØ ªÀåªÀºÁgÀ EvÀÄÛ, ¥ÀæwªÁ¢AiÀÄÄ ªÁ¢¬ÄAzÀ `50,000/- UÀ¼À£ÀÄß §rØAiÀÄAvÉ ¥ÀqÉ¢zÀÝ CAzÀgÉ ¸ÀjAiÀÄ®è. ¸ÀzÀj ºÀt ªÀÄÆgÀÄ ªÀµÀðzÀ°è §rØ ºÀt ¸ÉÃj, `90,000/- DVvÀÄÛ CAzÀgÉ ¸Àj C®è” - 9 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 15. This Court after going through the aforementioned suggestion is of the view that the interpretation of the said suggestion made by the Trial Court though appears to be correct on considering the evidence in its entirety the suggestion seems due to bonafide mistake or a terms error. On considering the other material on record one cannot say that there is an admission by the plaintiff relating to the alleged loan transaction. 16. The suggestion which has been extracted above has been read in isolation by the Trial Court. It is well settled principle of law that evidence has to be read as a whole and one or two sentences in the evidence cannot be taken to draw a definite conclusion in all situation. The aforementioned suggestion is preceded by the suggestion which reads as under : “¥ÀæwªÁ¢AiÀÄÄ vÀ£Àß ªÀÄ£ÉAiÀÄ CqÀZÀuÉAiÀÄ ¸À®ÄªÁV zÁªÁ d«ÄãÀ£ÀÄß ªÀiÁgÁlPÉÌ vÉUÉzÀ ªÀÄvÀÄÛ ªÁ¢AiÀÄÄ ¢£ÁAPÀ 13.07.2004 gÀAzÀÄ - 10 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 `1,00,000/- UÉ Rjâ ªÀiÁqÀ®Ä M¦àzÀ. `90,000/- »¸ÁgÁ CAvÀ PÉÆnÖzÁUÀ° PÉÆnÖzÁÝ£É JAzÀgÉ ¸Àj C®è.” 17. So, in the aforementioned suggestion, the plaintiff has taken a stand that there was an agreement for sale on 13.07.2004 and the defendant agreed to sell the property for `1,00,000/- and plaintiff paid `90,000/- to the defendant. Even otherwise, the recital in the agreement for sale in which the defendant’s signature is not disputed would reveal that the defendant agreed to sell the property for `1,00,000/-. 18. It is also noticed that the Trial Court has completely ignored the prima facie presumption arising from the agreement for sale. There is nothing in registered agreement for sale to hold that the transaction is a loan transaction. 19. The First Appellate Court has also noticed the fact that the defendant has not stepped into the witness box to substantiate his contention. DW.1 who is examined - 11 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 on behalf of defendant is the Power of Attorney Holder. The Power of Attorney is marked at Ex.D1 and the Power of Attorney does not indicate that the Agent is familiar with the transaction. It is also noticed that he is not a witness to the agreement for sale. However, he asserted that he was present when the registration took place. 20. The contention relating to the alleged loan transaction is not established more particularly in a situation where the defendant has not stepped into the witness box to substantiate his contention that he signed the document as security for the loan. The witnesses examined on behalf of plaintiff to prove the agreement for sale have supported the case of the plaintiff. 21. DW.2 who is one of the signatories to the agreement for sale has taken a stand that it was not an agreement for sale but it was only a loan transaction. In the cross-examination he has admitted that defendant has executed the agreement for sale and thereafter he has - 12 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 stated that he had only received `50,000/- towards hand loan and there was no agreement for sale. 22. The plaintiff has examined two witnesses as well as the scribe. On appreciation of the evidence of the witnesses as well as the scribe and also the evidence of DW.2 though he was one the witnesses to the agreement for sale and has stated contrary to the registered agreement for sale, this Court is of the view that the First Appellate Court is justified in holding that the agreement for sale is duly established. 23. This Court is also of the view, more particularly in a situation where the defendant has failed to enter the witness box and has led evidence of the Power of Attorney Holder to establish his contention that the transaction is a loan transaction has failed to establish the said contention. If at all, the transaction was loan transaction as contended by the defendant he should have examined himself as a witness before the Court. Though DW.1 the Power of Attorney Holder claims to be present when the transaction - 13 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 took place, there is nothing on record to show that he was present when the alleged loan transaction took place. He is not a signatory to the agreement for sale. 24. Under these circumstances, the finding of the First Appellate Court cannot be said to be one without evidence. The Trial Court was in error in holding that the agreement for sale is not established. 25. Another point that requires for consideration is whether the plaintiff was ready and willing to perform his part of contract. The First Appellate Court has noticed that the plaintiff soon after the execution of agreement for sale moved an application to get his name entered in the property records. 26. No doubt, it is true that agreement for sale does not create any title in favour of the agreement holder it only creates a right to enforce the agreement. However, the Appellate Court has held that the act of the plaintiff to move an application to get his name entered in the property record would indicate that he was ready and - 14 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 willing to perform his part of contract. The said observation cannot be said to be an erroneous observation. More so, in a situation where the plaintiff was only required to pay `10,000/- as balance consideration amount which is just 10% of the total amount agreed. Hence, this Court is of the view that readiness to perform the part of the contract is very much established. 27. Hence, this Court is of the view that the agreement for sale dated 13.07.2004 is very much established. Payment of balance part consideration of `90,000/- was also established. Readiness to prove the contract is also established. The defendant has not raised any defence leading hardship to deny the specific performance of the contract. 28. Under these circumstances, the impugned judgment and decree passed by the Trial Court is certainly not sustainable. The First Appellate Court is justified in reversing the aforementioned judgment and decree and consequently the substantial question of law framed by - 15 - NC: 2025:KHC-K:1395 RSA No.200023 of 2014 this Court are answered in favour of plaintiff/respondent against the appellant/defendant. 29. It is also brought to the notice of this Court that during the pendency of this appeal, the registered sale- deed has been executed pursuant to order passed in execution proceedings and the balance amount of `10,000/- already deposited before the Executing Court the appellant is entitled to receive the said amount and in case, the said amount deposited in any bank, the appellant is entitled to interest accrued on the said amount. Appeal is dismissed. No order as to costs. Sd/- (ANANT RAMANATH HEGDE) JUDGE SN List No.: 1 Sl No.: 44