Arifa Beevi & Shamna v. Nizarudeen

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR. JUSTICE A.MUHAMED MUSTAQUE** ## **&** **THE HONOURABLE MRS. JUSTICE SHOBA ANNAMMA EAPEN FRIDAY, THE 13[TH] DAY OF JANUARY 2023 / 23RD POUSHA, 1944** **RFA NO. 559 OF 2017** **AGAINST THE JUDGMENT AND DECREE DATED 22/6/2017 in OS 41/2015 OF SUB COURT, KARUNAGAPPALLY** ## **APPELLANTS/ DEFENDANTS:** 1 ARIFA BEEVI AGED 64 YEARS W/O. EBRAHIMKUTTY, KOCHAYYATHU VEEDU,PUNNAKKULAM MURI, ADINADU VILLAGE, KARUNAGAPPALLY TALUK. 2 SHAMNA AGED 33 YEARS D/O. EBRAHIMKUTTY, KOCHAYYATHU VEEDU,PUNNAKKULAM MURI, ADINADU VILLAGE, KARUNAGAPPALLY TALUK. BY ADVS. SRI.K.ABDUL JAWAD SMT.A.GRANCY JOSE SRI.M.K.PRASANTH KUMAR ## **RESPONDENT/PLAINTIFF:** NIZARUDEEN AGED 48 YEARS S/O. KOYAKUTTY, VETTOLIPARAMBIL VEEDU,KADATHOOR MURI, THAZHAVA VILLAGE, KARUNAGAPPALLY TALUK - 691 001. BY ADVS. P.V.VENUGOPAL P.CHANDRASEKHAR ANOOP KRISHNA ANAND SANKAR REGIMOL M.K. ## **R.F.A.No.559/2017(F)** ## -:2:- THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 13/12/2022, THE COURT ON 13/1/2023 DELIVERED THE FOLLOWING: ## **A.MUHAMED MUSTAQUE & SHOBA ANNAMMA EAPEN, JJ. ----------------------------------------R.F.A.No.559/2017(F) -----------------------------------------** ## **Dated this the 13[th] day of January, 2023** ## **J U D G M E N T** A.Muhamed Mustaque, J. This appeal was filed by the defendants in a suit for specific performance. The parties are referred to as per their status in the suit. The defendants are the owners of the suit property comprised re-survey Nos.177/23/2/1, 177/23/2/2 of Adinadu Village Karunagappally Taluk, having an extent of 3.5 Ares along with a residential building. The defendants entered into an agreement of sale with one Rahim, S/o. Muhammed Kunju **.** He approached the Sub Court, Kollam, for specific performance. An ex parte decree was passed. Thereafter, Rahim and the defendants settled their **R.F.A.No.559/2017(F)** ## -:2:- dispute on payment of the amount due to Rahim. The plaintiff in the present suit, Nizarudeen was witness to the settlement agreement. This settlement was on 19/11/2012. According to Nizarudeen, he entered into an agreement with the defendants on 17/11/2022 for purchase of property, for a total consideration of Rs.55,84,000/-. Rahim was witness to that agreement. The suit was laid by Nizarudeen alleging that he has paid Rs.10 lakhs towards advance sale consideration and the defendants failed to honour the agreement. The defendants entered appearance and contended that there was no sale agreement. According to the defendants, Nizarudeen-plaintiff is a real-estate broker and a blank signed stamp paper was obtained by Nizarudeen for settling financial transactions in respect of the property. This stamp paper was obtained for payment of brokerage to Nizarudeen. **R.F.A.No.559/2017(F)** ## -:3:- 2. The period of performance in the agreement was for six months. It was further stipulated that, after the period of six months, if any notification issued by the Government for development of National Highway is in existence, the period in Ext.A1 agreement can be extended till the revocation of the notification and, in case the notification is withdrawn, the plaintiff shall be intimated about the same and the sale deed shall be registered within 30 days in favour of the plaintiff or any other person as suggested by the plaintiff. The plaintiff was examined as PW1 and other witnesses were examined as PW2 to PW5. The second defendant was examined as DW1. The documentary evidence was also marked on both sides. The court also framed the issue regarding the execution of agreement of sale, apart from other issues relating to specific performance. The attesting witnesses were examined to prove **R.F.A.No.559/2017(F)** ## -:4:- execution of the agreement including Mr.Rahim, who obtained an _ex parte_ decree of specific performance against the defendants, earlier. The court, after adverting to the testimony of the witnesses, was of the firm view that the agreement was executed by the defendants with the plaintiff. The court also relied on the statement of accounts of the plaintiff to hold that the plaintiff had sufficient money with him to perform his part of the contract. 3. We are not on the point of financial capacity or willingness of the plaintiff, to decide the fate of this appeal. We are looking in this matter on a totally different angle, especially, 'the specific relief is being a discretionary relief'. 4. The defendants appear to be in dire need of money. They earlier entered into an agreement ## **R.F.A.No.559/2017(F)** ## -:5:- with Rahim. In that agreement Nizarudeen,the plaintiff was a witness. Rahim obtained an ex parte decree. He settled his claim with defendants on 19/11/2022. It seems two days before, the present agreement was entered with the plaintiff. In that Rahim was also a witness. The defendants were unable to prove that it was not an agreement executed by them, as they were unable to disown their signatures. It is important to note that the plaintiff, neither in the plaint nor while he was examined in chief examination, spoke about the prior transactions in which he was a witness. It is in that background, the dire need of money and the circumstances in which the defendants were placed, to enter into the agreement, had to be considered. The plaintiff could have very well explained all circumstances relating to execution of agreement of sale. Though the pleadings and evidence may be short to impeach the agreement of **R.F.A.No.559/2017(F)** ## -:6:- sale and its credibility, the court cannot overlook shoddy circumstances surrounding the transactions. The plaintiff approached as though there were no other transactions relating to property, prior to this agreement. Rahim and plaintiff, all appear to be part of some racket fleeting in real estate business and preying on the poor who are in dire need of money . In clandestine manner money is secured in the guise of property transactions. The unfair dealings though may not have affected the agreement of sale but can be looked into to decline the discretionary specific relief. The plaintiff could have very well explained all the circumstances relating to this agreement but he has not chosen to do so. The court cannot brush aside the plea of distraught ladies who were in dire need of money and falling into the prey of real estate agents. The precise case of the defendants is that, in **R.F.A.No.559/2017(F)** ## -:7:- order to settle monetary claim over the property, the blank stamp paper was signed and given to the plaintiff, who is a real estate agent. We are not unsettling agreement of sale as the agreement itself has been proved. But the circumstances clearly spell out suspicions to decline the discretionary relief. 5. The suit was filed on 4/11/2015. The agreement of sale was on 17/11/2012. PW1, the plaintiff, during cross-examination, pretended ignorance as to the case filed by Rahim. Ext.B1 is the settlement arrived between Rahim and the defendants. In that, Nizarudeen was a witness. In Ext.A1 agreement of sale executed between the defendants and the plaintiff, Rahim was a witness. The plaintiff and Rahim appear to be real estate agents or appear to be persons appearing for some other wealthy persons to purchase the property. DW1, in categorical terms, asserted that the **R.F.A.No.559/2017(F)** ## -:8:- plaintiff is a real estate agent, working for other wealthy persons. The past transactions of Rahim also certify this case. It is to be noted that the bank account statement of the plaintiff, produced and marked as Ext.A11, indicates that several cash deposits were made on 17/5/2013 and the corresponding bank balance as on that date was Rs.25,01,036/-. This appears to have been done to show that the plaintiff has sufficient money as on 17/5/2013. The six months time as agreed in the agreement expired on 17/5/2013. Thereafter, the case was filed only on 12/11/2015. All this would show that the plaintiff wants to make it appear that the agreement of sale was genuine and he was willing to perform his part of the contract. The circumstances as above indicate that the plaintiff is either a real estate agent or acting upon some third party to purchase the property. It seems that settlement was made by the defendants with **R.F.A.No.559/2017(F)** ## -:9:- Rahim, utilising the money given by the plaintiff. The facts and circumstances indicate that the plaintiff was not forthright in seeking discretionary relief in his favour. It is also true that the defendants have no consistent case in this matter. The defendants went on denying execution of the agreement. The court below found that the defendants were hiding the truth and further observed that the defendants were in the habit of entering into an agreement of sale with parties and wriggle out from the same to sell the property for a higher amount. It is to be noted that in a suit for specific performance, it is the plaintiff, who has to establish the case to exercise discretion in his favour. If the plaintiff had failed, that cannot be capitalised by pointing out the fault of the defendants. 6. Section 20(2) of the Specific Relief Act, 1963 gives leeway to the Court to exercise **R.F.A.No.559/2017(F)** ## -:10:- discretion not to decree, specific performance. Section 20(2) reads thus: 20. Discretion as to decreeing specific performance.- (2) The following are cases in which the court may properly exercise discretion not to decree specific performance: (a) where the terms of the contract or the conduct of the parties at the time of entering into the contract or the other circumstances under which the contract was entered into are such that the contract, though not voidable, gives the plaintiff an unfair advantage over the defendant; or (b) where the performance of the contract would involve some hardship on the defendant which he did not foresee, whereas its non performance would involve no such hardship on the plaintiff; or (c) where the defendant entered into the contract under circumstances which though not rendering the contract voidable, makes it inequitable to enforce specific performance. Explanation 1.- Mere inadequacy of consideration, or the mere fact that the contract is onerous to the defendant or improvident in its nature, shall not be deemed to constitute an unfair advantage within the meaning of clause (a) or hardship within the meaning of clause (b). Explanation 2.- The question whether the performance of a contract would involve hardship on the defendant within the ## **R.F.A.No.559/2017(F)** ## -:11:- meaning of clause (b) shall, except in cases where the hardship has resulted from any act of the plaintiff subsequent to the contract, be determined with reference to the circumstances existing at the time of the contract. (3) The court may properly exercise discretion to decree specific performance in any case where the plaintiff has done substantial acts or suffered losses in consequence of a contract capable of specific performance. (4) The court shall not refuse to any party specific performance of a contract merely on the ground that the contract is not enforceable at the instance of the party. ## 7. In **Nirmala Anand v. Advent Corporation** **(Pvt.) Ltd. [(2002) 8 SCC 146]** , the Apex Court recognised the discretionary power of the Court to deny specific relief after adverting to the attendant circumstances of the case. The Apex Court in **Nirmala Anand’s** case ( _supra_ ) at para 6 held as follows : It is true that grant of decree of specific performance lies in the discretion of the court and it is also well settled that it is not always necessary to grant specific performance simply for the reason that it is legal to do so. It is further well settled that the court in its **R.F.A.No.559/2017(F)** ## -:12:- discretion can impose any reasonable condition including payment of an additional amount by one party to the other while granting or refusing decree of specific performance. Whether the purchaser shall be directed to pay an additional amount to the seller or converse would depend upon the facts and circumstances of a case. Ordinarily, the plaintiff is not to be denied the relief of specific performance only on account of the phenomenal increase of price during the pendency of litigation. That may be, in a given case, one of the considerations besides many others to be taken into consideration for refusing the decree of specific performance. As a general rule, it cannot be held that ordinarily the plaintiff cannot be allowed to have, for her alone, the entire benefit of phenomenal increase of the value of the property during the pendency of the litigation. While balancing the equities, one of the considerations to be kept in view is as to who is the defaulting party. It is also to be borne in mind whether a party is trying to take undue advantage over the other as also the hardship that may be caused to the defendant by directing specific performance. There may be other circumstances on which parties may not have any control. The totality of the circumstances is required to be seen. 8. The totality of the circumstances do not warrant exercise of discretion in favour of the plaintiff. Sinister motive of the plaintiff was to make profit from vulnerable women, who were in **R.F.A.No.559/2017(F)** ## -:13:- dire need of money by inducing them to part with their precious and valuable property. The plaintiff had not pointed out any singular purpose for which he requires the suit property. There is nothing on record to hold discretion in favour of the plaintiff. We had to emphasize here that, in rural areas, the vulnerable women become prey to such scrupulous real estate agents. Their vulnerability is exploited by offering money. In a suit for specific performance, the Court should bestow all circumstances relating to agreement of sale. This Court is of the view that if there exists some suspicion and the plaintiff has not fully explained the circumstances relating to the agreement, the Court should decline specific performance and order refund of advance. In the result, the appeal is allowed, impugned judgment and decree are set aside. However, we order refund of advance amount of Rs.10,00,000/- ## **R.F.A.No.559/2017(F)** -:14:- (Rupees ten lakhs only) within a period of two months along with interest from the date of suit till realization at the rate of 6% per annum. Parties are directed to suffer their respective costs. **Sd/-** **A.MUHAMED MUSTAQUE, JUDGE** **Sd/-** **SHOBA ANNAMMA EAPEN, JUDGE** ## **ms**