Hari Singh and another vs Mela Ram and another

Pritam Singh Pattar, J.—This is a regular second appeal filed by Hari Singh and Om Parkash Defendants against the judgment dated July 10, 1970, of the Additional District Judge, Gurdaspur, dismissing their appeal against the judgment and decree dated August 30, 1969, of Subordinate Judge I Ind Class, Gurdaspur, whereby he granted decree for specific performance of the agreement of sale of the land in suit in favour of the Plaintiffs against them.

The facts of this case are that Hari Singh Defendant agreed to sell the land in suit measuring 15 Kanals 8 Marias fully described in the plaint and situated in the area of village Talabpur, District Gurdaspur, for Rs. 4,000/- to Mela Ram and Charan Dass on the basis of an agreement to sell, Exhibit P. 1, dated March 4, 1968. One of the conditions of the agreement was that Hari Singh would get the land mutated in his name and then he would sell the same to the Plaintiffs within one week. He received Rs. 1,500/- as advance at the time of the execution of the agreement Exhibit P. 1. The Plaintiffs gave notice Exhibit P. 3 on June 28, 1968, to Hari Singh stating that they waived this condition in the agreement regarding the mutation and that he (Hari Singh) should execute the sale-deed in their favour immediately. They also made an application to the Panchayat that Hari Singh had agreed to sell the land to them and no one else should purchase the same. The Panchayat proclaimed this fact by beat of drum in the village. Hari Singh Defendant in his reply Exhibit P. 4 dated July 21, 1968, to the notice sent to him by the Plaintiffs, stated that he did not agree to sell the land to them. Hari Singh sold the land for Rs. 8,000/- to Om Parkash Defendant on August 1, 1968 The Plaintiffs then filed suit for specific performance of the agreement to sell the land in their favour against Hari Singh and Om Parkash. In the alternative it was pleaded that Hari Singh may be ordered to pay Rs. 3,000/- as damages to them. On the pleadings of the parties the following issues were framed by the trial Court:-

(1) Whether Defendant No. 1 executed the agreement of sale dated March 4, 1968, in favour of the Plaintiffs, and if so, on what terms and its effect ?

(2) Whether Defendant No. 2 had notice of the agreement of sale dated March 4, 1968. and if so, its effect ?

(3) Whether the Plaintiffs are entitled to Rs. 3,000/- from Defendant No 1 on account of the payment of earnest money and damages and if so, to what amount ?

(4) Relief.

The trial Court decided issues Nos. 1 and 2 in favour of the Plaintiffs. It was held on issue No. 3 that in the alternative, the Plaintiffs were entitled to Rs. 3000/- from the Defendant on account of earnest money and damages. The Subordinate Judge passed decree for specific performance of the agreement to sell the land in suit in favour of the Plaintiffs against the Defendants with costs. Feeling aggrieved, the Defendants filed an appeal against this decree in the Court of the District Judge, which was dismissed by the Additional District Judge on July 10, 1970. Thereafter, the Defendants filed this regular second appeal.

This appeal came up for hearing before me on March 10, 1975. The Learned Counsel for the Appellants contended that no finding on issues Nos. 2 and 3 was given by the Additional District Judge and, therefore, the decision of the lower appellate Court should be set aside and the case should be remanded for fresh decision on those issues. No finding was given on issue No. 2 and it was simply stated that on the basis of the agreement to sell a right in the land was created in favour of the Plaintiffs before the land was sold to Om Parkash Defendant No. 2 and it was immaterial whether Om Parkash had notice of the agreement Exhibit P. 1 executed in favour of the Plaintiffs or not. He also did not give any finding on issue No. 3. Since the lower appellate Court had not given any decision on issues Nos. 2 and 3, therefore, the remand of the case under Order 41 Rule 25, CPC Code, was considered necessary. Further, the Appellants had made an application under Order 41, Rule 27, and Order 26, Rule 9, CPC Code, for production of additional evidence and for appointment of a Local Commissioner in the lower appellate Court on March 20, 1970. This application was contented by the Respondents. However, this application was not decided either by a separate order or at the time of decision of the appeal. The case was, therefore, remanded to the lower Appellate Court under Order 41, Rule 25, CPC Code, with the direction that it should decide issues No. 2 and 3 after discussing the oral and documentary evidence of the parties produced in this case and should send its report alongwith the evidence and its findings thereon to this Court. The lower Appellate Court was also directed to decide the application made by the Appellants under Order 41, Rule 27, and Order 26, Rule 9, CPC Code. A direction was also given that if the application of the Appellants under Order 41 Rule 27, CPC Code, was allowed, then the parties should be permitted to produce their evidence on all the issues and the Court should redecide all the three issues and submit its report along with the evidence recorded.

After this remand order, the Additional District Judge, Gurdaspur, heard the arguments of the counsel for the parties regarding the application made by the Appellants under Order 41 Rule 27 and Order 26 Rule 9 read with Section 151 of the Code of Civil Procedure, and he dismissed the same by his order dated 2lst April 1975. Thereafter he heard the arguments of the counsel for the parties on issues Nos. 2 and 3 on 30th April 1975 and decided these two issues on that date. After discussing the oral and documentary evidence produced by the parties he held that Om Parkash Defendant-Appellant had notice of the agreement to sell dated March 4, 1968 executed by Hari Singh in favour of the Plaintiffs and he was not a purchaser in good faith for consideration without notice and he decided issue No. 2 against the Defendants. On issue No. 3 he held that the Plaintiffs were entitled to a decree for specific performance of the agreement to sell. The Additional District Judge, Gurdaspur, sent its orders dated 21st April 1975 and 30th April 1975 to this Court. The Appellants filed objections against these orders. It was alleged that the decision of the lower Appellate Court in rejecting their application under Order 41 Rule 27, CPC Code, is wrong and incorrect and it may be set aside and that their application may be accepted. The decision on issues Nos. 2 and 3 of the Additional District Judge was also alleged to be wrong and incorrect and it was prayed that the same may be set aside and the suit of the Plaintiffs may be dismissed.

The lower Appellate Court after discussing the oral and documentary evidence produced by the parties decided issues Nos. 1 and 2 in favour of the Plaintiffs. It was held that the Defendant executed the agreement to sell the land in suit on March 4, 1968, in favour of the Plaintiffs and that Om Parkash Defendant-Appellant had notice of this agreement and he was not a bona fide purchaser for consideration without notice. This finding of fact cannot be interfered with in second appeal. In this respect reference may be made to Deity Pattabhirama-swamy v. S. Honymayya AIR 1959 S.C. 57, wherein it was held as under:-

The provisions of action 100 (Civil Procedure Code) are clear and unambiguous. There is no jurisdiction to entertain a second appeal on the ground of erroneous finding of fact, however gross the error may seem to be. Nor does the fact that the finding of the first appellate Court is based upon some documentary evidence make it any the less a finding of fact. A judge of the High Court has, therefore, no jurisdiction to interfere in second appeal with the findings of fact given by the first appellate Court based upon an appreciation of the relevant evidence.

Similar was the law laid down in Madamanchi Ramappa and Another Vs. Muthalur Bojjappa, and R. Ramachandran Ayyar Vs. Ramalingam Chettiar, . It was further observed in the latter decision that the High Court in second appeal cannot interfere with the conclusions of fact recorded by the lower appellate Court on the evidence produced by the parties, however erroneous the said conclusions may appear to be to the High Court. In the instant case, the lower Appellate Court decided issues Nos. 1 and 2 after discussing the oral and documentary evidence on the file and these conclusions cannot be interfered within the second appeal. Therefore, in view of the law laid down in these decisions, the decision on issues Nos. 1, 2 cannot be interfered with in second appeal.

The Learned Counsel for the Appellants then contended that the lower Appellate Court wrongly rejected the application made by them under Order 41 Rule 27 and Order 26 Rule 9, CPC Code, for production of additional evidence and for issuance of a commission and if that evidence is allowed to be admitted, the decision of the Additional District Judge on issue Nos. 1 and 2 will be vitiated. During the pendency of the first appeal, the Defendants-Appellants made an application in the Court of the Additional District Judge stating that Hari Singh Defendant neither executed the agreement to sell land nor received Rs. 1500/- as earnest money. He also did not purchase the stamp paper from the stamp vendor and that his thumb-impressions on the agreement were obtained by his brother Onkar Singh and the attesting witness Amar Nath on the representation that the execution of the decree for pre-emption passed in his favour was to be got expedited. According to him he did not put his thumb impression in the register of the stamp vendor from whom the stamp paper on which the agreement to sell was written was purchased. It was, therefore, prayed that the Appellants may be permitted to produce evidence to compare the thumb-impression of Hari Singh with his thumb-impressions in the register of the stamp vendor and also on the agreement to sell. As regards the prayer for issuance of a commission under Order 26 Rule 9, CPC Code, it was alleged that the application Exhibit A-2 made by the Plaintiffs to the Panchayat was a concocted affair and that no mention of it was made in the records of the Panchayat and that a commission may be appointed immediately to proceed to village Talabpur and take possession of the register of the Panchayat containing the proceedings on 5th July 1968 and to produce the same in Court. This application was contested by the Plaintiff-Respondents in that appeal.

Order 41 Rule 27, CPC reads as follows:-

(1) The parties to an appeal shall not be entitled to produce additional evidence, whether oral or documentary, in the Appellate Court. But if-

(a) the Court from whose decree the appeal is preferred has refused to admit evidence which ought to have been admitted, or

(b) the Appellate Court requires any document to be produced or any witness to be examined to enable it to pronounce judgment, or for any other substantial cause, the Appellate Court may allow such evidence or document to be produced, or witness to be examined.

(2) Wherever additional evidence is allowed to be produced by an Apellate Court, the Court shall record the reason for its admission.

It is well-settled law that additional evidence should not be permitted at the appellate stage in order to enable one of the parties to remove certain lacunae in presenting its case at the proper stage, and to fill in gaps. Of course, the position is different where the appellate Court itself requires certain evidence to be adduced in order to enable it to do justice between the parties. Additional evidence should not be permitted to be produced by the Appellate Court if the party making the application had sufficient opportunity to produce the same in the trial Court. The legitimate occasion for the application of Order 41 Rule 27, CPC is when, on examining the evidence as it stands, some inherent lacunae or defect becomes apparent, not where a discovery is made, outside the Court, of fresh evidence and the application is made to import it The true test, therefore, is whether the Appellate Court is able to pronounce judgment on the materials before it without faking into consideration the additional evidence sought to be adduced. If the Appellate Court itself requires certain evidence to be adduced to enable it to pronounce judgment then alone additional evidence can be permitted to be produced-vide State of U.P. Vs. Manbodhan Lal Srivastava, Arjun Singh alias Puran Vs. Kartar Singh and others, and Amar Singh v. Ashok. Kumar (1973)75 PLR 761. Now, in the instant case the the Appellants could produce the additional evidence, for the production of which this application was made, in the trial Court. They could have summoned the register of the stamp vendor during the trial of the case and got the thumb impression in that register compared with the admitted thumb-impression of Hari Singh Defendant-Appellant. They cannot be permitted to fill in the lacunae in their evidence. In view of the law laid down in the above-mentioned authorities, the appplication for production of the additional evidence was rightly dismissed by the learned A Additional District Judge and this decision is affirmed.

The Appellants fully well knew that at the instance of the village Panchayat a proclamation by beat of drum was made in the village to dissuade or to restrain the intending purchasers to purchase the property in suit. To prove these allegations, the Plaintiffs produced original application in the trial Court and also produced the Sarpanch of the village Panchayat and also the village Chaukidat, who made the proclamation. Therefore, the Defendants-Appellants could summon the Panchayat register to prove the proceedings of the Panchayat on 5th July, 1968, when the Panchayat ordered the proclamation in the village to be made on the application made by the Plaintiffs, but this was not done for reasons best known to them No question regarding all these facts was put to the Sarpanch Ram Lal and to the Chauk dar in their cross-examination. Moreover, such a commission could not be issued by the Court under Order 26 Rule 9, CPC Code. In fact this prayer for appointment of a commission was only a request for production of additional evidence and the same was also rightly rejected by the Additional District Judge and his decision on this point is upheld

For the above reasons the contention of the counsel for the Appellants that the application of the Appellants was not correctly decided by the Additional District Judge is without force and is rejected. It is, therefore, held that the decision of the lower Appellate Court on issues Nos. 1 and 2 cannot be interfered with in second appeal.

Exhibit P. 1 dated March 4, 1968, is the agreement executed by Hari Singh Defendant-Appellant in favour of the Plaintiffs to sell the land in suit in their favour for Rs. 4,000/-. He was to execute the sale deed in their favour within one week of the attestation of the mutation Order of this land in his favour In case he failed to execute the sale deed he was to return the amount of earnest money i.e. Rs. 1500/- and also to pay damages amounting to Rs. 1500/-. In case the Plaintiffs failed to get the sale deed executed then their earnest money was to stand forfeited. Section 10(a) of the Specific Relief Act, 1963, reads as under:-

Except as otherwise provided in this Chapter, the specific performance of any contract may, in the discertion of the court, be enforced-

(a) when there exisits no standard for ascertaining the actual damage caused by the non-performance of the act agreed to be done, or

(b) when the act agreed to be done is such that compensation in money for its non-performance would not afford adequate relief.

Explanation. - Unless and until the contrary is proved, the Court shall presume-

(i) that the breach of a contract to transfer immovable property cannot be adequately relieved by compensation in money.

The explanation (i) of Section 10 raises a presumption in case of agreement to sell immovable property that the breach of such contract cannot be adequately relieved be compensation in money unless and until the contrary in proved. The onus to prove that the vendee can be adequately compensated in money is on the vendor. In the instant case the Defendants-Appellants did not produce any evidence to show that the Plaintiffs could be adequately compensated in money and the decree for specific purpose should not be passed. In other words they failed to rebut the presumption raised in Section 10, explanation (i) of the Specifie Relief Act.

In Ambalal Kesherbhai v. Ranchhodbhai Jerbhai, AIR l956 Bom. 120 it was held that the presumption arising under Explanation of Section 12 of the Specific Relief Act 1977 (in Section 10 of the Specific Relief Act, 1963), in the case of contracts for immovable property always is that damages are not an adequate remedy, and the presumption is not rebutted merely by the fact that the parties had provided for recovery of damages by the buyer. To the same effect was the law laid down in S. Ramalinga Pillai Vs. G.R. Jagadammal alias Jagadamba Ammal and Another,

13 Dina Nath Bhandari.v. Parkash Chand Jain,(1972)74 PLR 14 a Division Bench of this Court held as under -

that in the Explanation to Section 10 of the Specific Relief Act it clearly mentioned that unless and until the contrary is established the Court will presume that the breach of a contract to transfer immovable property cannot be adequately relieved by compensation in money. Where the Defendant his not brought anything on the record to show that the Plaintiff could be suitably compensated by award of liquidated damages, a decree for specific performance could be passed.

To the same effect was the law laid down in Kaur Sain v. Karam Chand 1974 Rev. LR 237

In M.L. Devender Singh and Others Vs. Syed Khaja, it was held:- "The fact that the parties themselves have provided a sum to be paid by the party breaking the contract does not, by itself, remove the strong presumption contemplated by the use of the words "Unless and untill the contrary is proved." The sufficiency or insufficiency of any evidence to remove such a presumption is a matter of evidence. The fact that the parties themselves specified a sum of money to be paid in the event of its breach is, no doubt a piece of evidence to be considered in deciding whether the presumption has been repelled or not. But, it is nothing more than a piece of evidence. It is not conclusive or decisive.

The presumption contained in the explanation to Section 12 of the old Act was not rebutted here. In such cases equity helps honest Plaintiffs against Defendants who break solemnly given undertakings.

The efffect of the presumption is that the party coming to court for the specific performance of a contract for sale of immovable property need not prove anything until the other side has removed the presumption After evidence is led to remove the presumption, the Plaintiff may stil be in a position to prove, by other evidence in the case, that payment of money does not compensate him adequately.

To the same effect was the law hid down in Civil Regular First Appeal No-3 of 1954 re: Harkishan Lal Kharbanda v. Bharat Mittal, RFA 3 of 1964 decided on May 6, 1974, by this Court.

The legal position that emerges from the analysis of the above-mentioned decisions is that according to explanation (i) of Section 10 of the Specific Relief Act, 1963, the Court shall presume that the breach of a contract to transfer immovable property cannot be adequately relieved by compensation in money unless and until the contrary is proved The effect of this presumption is that a party coming to court for specific performance of such a contract need not prove anything unless and until the other party has rebutted this presumption by producing evidence that the Plaintiff could be adequately compensated by payment of money. The sufficiency or insufficiency of any evidence to rebut the presumption is a matter of decision by the Court. The fact that the parties themselves have provided in the contract a sum to be paid by the party breaking the contract is just a piece of evidence and it does not by itself rebut the strong presumption contemplated by the use of the words, "unless and until the contrary is proved." After evidence is led to rebut the presumption, the Plaintiff is entitled to produce evidence to prove that payment of money does not compensate him adequately.

The law laid down in these decisions is fully applicable to the fact of this case. As mentioned above, the Defendants-Appellants did not produce any evidence to rebut the presumption raised in favour of the Plaintiffs under explanation of Section 10 of the Specific Relief Act. The decision of the learned Additional Distiict Judge on issue No 3 is correct and the same is affirmed.

No other point was urged.

There is no force in this appeal and the same is dismissed with costs