Raju T.B. v. P.A. Radhakrishnan and N.M. Hashim (RFA No. 326 of 2016)

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MRS. JUSTICE SHIRCY V.** **MONDAY, THE 27TH DAY OF MAY 2019 / 6TH JYAISHTA, 1941** ## **RFA.No.326 of 2016** **AGAINST THE DECREE AND JUDGMENT IN OS 482/2013 of II ADDITIONAL SUB COURT,ERNAKULAM** ## **APPELLANT/DEFENDANT:** **RAJU T.B. AGED 44 YEARS, S/O T.P. BALAKRISHNAN, VADAYAZHATH HOUSE, PANANGAD DESOM, KUMBALAM VILLAGE, KANAYANNUR TALUK, ERNAKULAM DISTRICT** **BY ADVS. SRI.M.NARENDRA KUMAR SMT.M.J.SAJITHA** ## **RESPONDENTS/PLAINTIFFS:** **1 P.A.RADHAKRISHNAN AGED:54 YEARS, S/O MR. APPU, VALAYANAHATH HOUSE, PANANGAD,KUMBALAM-682506, ERNAKULAM DISTRICT** **2 N.M. HASHIM AGED:38 YEARS, S/O KUNJUMOHAMMAD, NAGAPPADI VEEDU, MADAVANA, PANANGAD, KUMBALAM VILLAGE, ERNAKULAM DISTRICT-682506** **BY ADVS. SRI.K.J.GLADIS SMT.S.SREEDEVI(ALP) SRI.T.K.RADHAKRISHNAN SMT.CHITRA.R.SHENOY SRI.HARIKRISHNAN T.R** **THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 24.01.2019, THE COURT ON 27.05.2019 DELIVERED THE FOLLOWING:** RFA.No.326 of 2016 2 ## **JUDGMENT** This appeal arises out of a judgment and decree dated 31.3.2016 passed by the Sub Judge, Ernakulam in O.S.No.482/2013, thereby granting a decree for specific performance of contract in favour of the respondents/plaintiffs. 2. The facts of the case as pleaded by the plaintiffs are as follows: The appellant/defendant is the owner in possession of 6 cents of land with a building in Resurvey No.161/2010 in Block No.16 of Kumbalam Village. On 2.7.2013 an agreement for sale of the property was executed by the plaintiffs and the defendant fixing the total consideration as Rs.25 lakhs. Out of the same Rs.21 lakhs was paid as advance towards the sale consideration. As per the terms of the agreement the defendant had to satisfy the plaintiffs the exact extent of the land by measurement and also to hand over the original title deed, prior title deed, possession certificate, land tax receipt, non-encumbrance certificate etc. to the plaintiffs. The period fixed for performance RFA.No.326 of 2016 3 of the contract was two months and so the time expired on 2.9.2013. But he did not execute the sale deed though the plaintiffs approached him expressing their readiness and willingness to purchase the property after payment of the balance sale consideration of Rs.4 lakhs. In spite of the lawyer notice dated 26.8.2013 there was no response from the side of the defendant. Hence, the suit was filed for specific performance of contract, and alternatively to refund the advance amount. 3. The defendant resisted the suit denying the execution of the sale agreement. It was contended that the plaintiffs are business men and they are financially sound and they approached him through one Sajin with a request to help them to invest money in a company run by the brother-in-law of the plaintiffs by name Wismore and thus he invested money .Sajin and the plaintiffs who are close friends brought blank stamp papers and white papers and obtained signatures from the defendant. Sajin had mobilised money from various persons also. Later the plaintiffs have fabricated the blank signed papers and thus a false sale agreement was created . The defendant, his wife and two minor children are residing along with their mother in RFA.No.326 of 2016 4 the building in the plaint schedule property. The property would fetch an amount of Rs.95 lakhs. He was not having any intention to sell his property, and no sale agreement was executed between the parties. 4. Before the court below, the second plaintiff was examined as PW1. PW2 to PW4 were also examined on the side of the plaintiffs and marked Exts.A1 to A13. The defendant was examined as DW1 and Exts.B1 to B3 were marked on his side. Exts.C1 and C1(a) were marked as court exhibits. The court below after evaluating the evidence decreed the suit for specific performance. Aggrieved by the said judgment and decree the defendant/appellant had preferred this appeal. 5. The plaint schedule property is 6 cents of land with a residential building. The defendant who is the owner of the property had agreed to sell the same to the plaintiffs for a total sale consideration of Rs.25 lakhs and received Rs.21 lakhs as advance towards the sale consideration, is the case put forth by the plaintiffs. But the defendant had denied the execution of Ext.A1 agreement to sell dated 2.7.2013. The second plaintiff as PW1 has reiterated the averments in the plaint and according to RFA.No.326 of 2016 5 him the defendant who was in acute need of money had approached the plaintiffs with the offer for sale of the property and the sale consideration was fixed as Rs.25 lakhs and out of Rs.25 lakhs, Rs.21 lakhs was received on the very same day and that had been specifically recited in Ext.A1 agreement. PW1 has also deposed that they were ready to pay the balance sale consideration of Rs.4 lakhs and the readiness and willingness to purchase the property on payment of the balance sale consideration of Rs.4 lakhs was intimated to the defendant, but the defendant somehow or other evaded the execution of the sale deed. A perusal of the records would show that in fact PW1 had deposed before the court that to arrange money he had sold his property for a total sale consideration of Rs.14 lakhs. Ext.A5 is the certified copy of the sale deed. According to him he had also entered into an agreement for sale of another property for a total sale consideration of Rs.1,60,00,000/-. PW1 had given evidence to the effect they were ready and willing to pay the balance sale consideration and thus to perform their part of contract. But as mentioned earlier, the defendant in order to establish his case that the plaintiffs had misused the blank signed stamp paper and RFA.No.326 of 2016 6 blank plain paper and fabricated documents and falsely created Ext.A1 agreement, relies on Ext.B1 which is the copy of a final report in Crime No.968/2013 of Panangad Police Station in which the defendant is the first accused. Ext.B2 is the certified copy of the FIR in that case and Ext.B3 is the certified copy of the refer report. These documents would show that one Sabu had preferred a complaint against the defendant and two others alleging that they have committed cheating on the complainant by producing fabricated documents as a result of the criminal conspiracy hatched between them. But on investigation it was found that the case filed against them was a false one and the refer report of the Investigating Officer was accepted by the Additional Chief Judicial Magistrate Court, Ernakulam. But it is pertinent to note that the defendant could not adduce any evidence to prove that Ext.A1 is a fabricated document created by the plaintiffs so as to snatch away his property. On the other hand, Ext.A1 would reveal that the document was executed in the presence witnesses examined as PW2 and PW3, with the intention to sell the property. 6. PW2 Suresh, the first witness to Ext.A1 had deposed that RFA.No.326 of 2016 7 the plaintiffs and the defendant are persons known to him for a pretty long time and the defendant was a bus conductor by profession. He had also deposed that he had signed the sale agreement as a witness as requested by both the parties, at his shop and PW3 also signed it as a witness after he affixed his signature. Therefore, it could be seen that as he had acquaintance with both the plaintiffs and the defendant for a long period, he stood as a witness to the transaction. According to PW3 he happened to sign the document when he had gone to the shop run by PW2 for having some cool drinks on that particular day and as PW2 and the parties to the agreement are persons known to him, he too signed the document as a witness knowing that Ext. A1 was a sale agreement. It is to be noted that PW1 had deposed before the court that they have prepared Ext.A1 at the residence of the defendant and thereafter proceeded towards the nearby shop so as to get signatures of witnesses and then handed over the amount of Rs.21 lakhs/- as advance towards the sale consideration. According to him, the amount of Rs.21 lakhs was kept by him in a bag and after affixing signature in Ext.A1 the amount was handed over to the defendant. So according to RFA.No.326 of 2016 8 PW1, PW2 and PW3, Ext.A1 agreement was executed for sale of the plaint schedule property and the defendant had received the amount from the plaintiffs. 7. It is pertinent to note that of-course the defendant had denied the execution of Ext.A1 sale agreement but, as he admitted his signature in the document, definitely the burden is heavily upon him to prove that he had signed in blank stamp papers and white papers and handed over to the plaintiffs to mobilize money for the business run by the brother-in-law of the 1[st] plaintiff at the instigation of one Sajin. It is pertinent to note that the so called Sajin was not examined before the court by the defendant. It is doubtless that the burden is upon the defendant who asserts that his signature in a blank stamp paper or white paper were obtained and misused by the plaintiffs and cooked up the case so as to cheat him. If the defendant was approached by the plaintiffs through the above referred Sajin he would have examined Sajin as a witness to substantiate his case. But there was no attempt to prove the said fact and there was also no satisfactory evidence to substantiate the case that there was a company by name Wismore and the defendant was persuaded to RFA.No.326 of 2016 9 invest in the company and thus he happened to affix his signature in blank stamp papers or plain papers giving an opportunity to the plaintiffs to misuse the same. When a person signs a document, the presumption is that he signed it after he understood the contents of it. But when a contention is raised that his signature in blank paper was misused, the burden is more heavy and stronger as nobody will affix signatures like that, normally, in particular businessman, since money is involved. It is pertinent to note that the plaintiffs have a definite case that they had issued Ext.A2 lawyer notice calling upon the defendant to perform the sale agreement. But there was no reply to the lawyer notice by the defendant. If he had not executed the document and the plaintiffs had misused his signature affixed in a blank stamp paper or plain paper definitely he would have raised his contention at the earliest opportunity, immediately on receipt of Ext.A2 lawyer notice. It is pertinent to note that Ext.A1 stamp paper was purchased by the defendant on the date of execution of the sale agreement dated 2.7.2013. No circumstance was pointed out by the defendant so as to infer that such a document was manipulated by the plaintiffs by misusing the signed stamp RFA.No.326 of 2016 10 paper. There was also no explanation on the side of the defendant apart from the contention that the plaintiffs had approached him to invest in the company by name Wismore and at that time signed stamp papers were handed over to the plaintiffs as if he has given an opportunity to the plaintiffs to fabricate the document. In the absence of reliable evidence it is difficult to conclude that the defendant had invested money in a company as requested by the plaintiffs and Sajin and handed over the signed stamp papers with the expectation of getting profit as an investor of the company. When the defendant had such a case the burden is upon him to prove the same. The circumstances such as the production of Ext.A8, A9 and A10 encumbrance certificates and other documents would also indicate that the version of the plaintiffs that the encumbrance certificates were handed over by the defendant as a part of execution of Ext.A1 sale agreement and it was not for any other purpose. So in total it could be seen that the defendant could not substantiate his case that Ext.A1 sale agreement was created fraudulently by the plaintiffs by playing fraud on him in order to snatch away his property which would fetch at least an amount of RFA.No.326 of 2016 11 Rs.95 lakhs for a meager amount of Rs.25 lakhs. In fact there is no serious allegation of force or fraud and there is no proof of force or fraud. 8. Since it has come out in evidence that Ext.A1 is a sale agreement executed and intended for sale of the property, the question to be looked into is whether the plaintiffs are entitled to get a decree for specific performance of contract. It is well settled that in order to get a decree for specific performance the plaintiffs have to prove the readiness and willingness to perform their part of contract and the readiness and willingness have to be shown through out. It is also well settled that in a suit for specific performance the plaintiffs' readiness and willingness on their part is a condition precedent to grant the relief of specific performance. The readiness and willingness of the plaintiffs to perform the contract has to be proved right from the date of execution till the date of the decree and the plaintiffs are supposed to prove that they were ready to pay the balance sale consideration by definite evidence. In the present case it is to be noted that the total sale consideration was only Rs.25 lakhs. Out of the same the major portion ie, Rs.21 lakhs had already been RFA.No.326 of 2016 12 paid by the plaintiffs. So the balance remaining is only Rs.4 lakhs. It has come out in evidence that the plaintiffs have already sold certain extent of their property and had arranged money to pay the balance sale consideration of Rs.4 lakhs. So the evidence adduced by the plaintiffs would establish that they were capable of arranging the money or they have the capacity to pay the balance sale consideration. The defendant has no case that the plaintiffs are not having sufficient funds so as to pay the balance sale consideration. On an overall evaluation of the evidence adduced by the plaintiffs, it could be seen that there was sufficient evidence to prove that the plaintiffs were ready and willing to perform their part of obligation by paying balance sale consideration of Rs.4 lakhs within the prescribed time. So the case of the plaintiffs that they were ready and willing to perform their part of the contract could only be accepted as true and it stands proved by the reliable evidence adduced by the plaintiffs. 9. It is pertinent to note that even if the plaintiffs are ready with the balance sale consideration and to perform their part of obligation the Court is not bound to grant a decree for specific performance merely because it is lawful to do so, as the relief for RFA.No.326 of 2016 13 specific performance is purely discretionary in view of Section 20 of the Specific Relief Act, 1963. However, the discretion of the court must be sound, reasonable and guided by judicial principles. According to the defendant the suit property is his only property where his family is residing and if the suit is decreed for specific performance it will cause undue hardship to him. ## 10. In **Prakash Chandra vs. Narayan [2012 KHC 4239]** it was observed by the Hon'ble Supreme Court in paragraph No.13 as follows: “13. ............... In a case of Specific Performance, hardship is a good defence provided such defence is taken by the defendant and evidence in support of such defence is brought on record, while in this case no such defence was taken by the respondent and no evidence was brought on record in its support.” 11. The learned Counsel for the defendant has also relied on the decision of this court in Aliyas v Aboobacker(2006 (4) KLT 282) and argued that discretion should be exercised taking into consideration of all the relevant facts and circumstances of the case guided by judicial principles. If the defendant is able to RFA.No.326 of 2016 14 convince the court that if a decree for specific performance is granted, great hardship will be caused to him which was not foreseen by him and at the same time it will result in unlawful enrichment and unfair advantage to the plaintiffs, the court can exercise the discretion in favour of the defendant, not to decree specific performance. 12. Here it is pertinent to note that the defendant's definite case is that if the prayer for specific performance is allowed, that may cause undue hardship to him as the plaint schedule property and the house are his only assets and if it is lost he would be landless and left with no place of abode. 13. In the written statement he had specifically stated that he is residing along with his family including his aged mother and two minor children in the residential house situated in the property. He is also a bus conductor by profession and no evidence is forthcoming which would indicate that he is having some other landed property or residential house for his accommodation along with his family. Of course he has also a case that the property would fetch at least an amount of Rs.95 lakhs in 2013 and its present value is 1.25 crores. Relying on RFA.No.326 of 2016 15 the decision of this Court in **Faizal Eroth and another v. Venkalath Raveendran and another (2013(3) KLT 1041)** the learned counsel for the plaintiffs would argue that increase in the value of land during the pendency of the litigation is not a ground to deny the relief of specific performance. It is true that escalation in the price of the land cannot be a ground for denying the relief of specific performance .In the present case it is significant to note that the plaintiffs have no case that they were intending to purchase the property for construction of a residential house for their own accommodation. The plaintiffs are two different persons and it is evident from the records that they were having other properties also and they had entered into property transactions with others also and the second plaintiff had entered into a sale agreement on 10.5.2015 agreeing to sell his another property for an amount of Rs.1 crore 60 lakhs. But on the other hand there is no positive evidence to infer that the defendant is having any other property so as to accommodate his family consisting of his aged mother, wife and minor children. So definitely the hardship that may be caused to the defendant by execution of the sale deed in compliance of Ext.A1 will be great RFA.No.326 of 2016 16 than the inconvenience or difficulty that may cause to the plaintiffs on non execution of the sale deed. In fact the escalation of the price may also cause heavy financial loss and hardship to find out a suitable accommodation for the family of the defendant which he did not foresee, while non-performance may not cause such hardship to the plaintiffs. These circumstances would sufficiently indicate that no hardship would be caused to the plaintiffs, in exercising the discretion in favour of the defendant. Therefore, it is just and proper to apply the doctrine of comparative hardship in favour of the defendant and I think that this is fit case where discretion should be exercised not to decree specific performance. As there is an alternative prayer in the suit in accordance with the mandate under Section 22 of the Specific Relief Act it would be just and proper to pass a decree for repayment of the amount. No doubt, the amount has to be necessarily paid back to the plaintiffs with reasonable interest. Hence I conclude that the judgment and decree under challenge are liable to be modified and the alternative prayer for the return of the advance amount received by defendant can be directed to be returned to the plaintiffs. RFA.No.326 of 2016 17 In the result, the appeal is allowed directing the defendant to return the amount of Rs.21 lakhs with interest at the rate of 12% per annum from the date of Ext.A1, the agreement for sale (2.07.2013) till realization and the decree amount is charged upon the plaint schedule property. The defendant shall return the amount as aforesaid within a period of three months from today. The parties are directed to bear their costs. The appeal is accordingly allowed. Realize the court fee as per law. Sd/- **SHIRCY V JUDGE** ## smm