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Judgment
Heard the learned Counsel for the parties and perused the record.
The appeal is based on the following substantial questions of law:-
Whether the learned lower Appellate Court was justified in considering that the suit based on enforcement of right/contract arising out of unregistered partition deed is maintainable/enforceable?
Whether the learned lower Appellate Court was justified in considering that the suit for specific demarcated land out of undivided family property can be entertained without joining the co-parceners as party respondent?
Being aggrieved by the judgment in Special Civil Suit No.448/2008 and in Regular Civil Appeal No.110/2016 the appellants have filed this appeal on the above substantial questions of law.
The appellants are the original defendants. The suit was filed by the respondent Purushottam Kharabe for specific performance which was decreed. The appeal was filed by defendants and the Appellate Court has dismissed the appeal.
The dispute relates to Field Khasra No.31/6, P.H. No.40 of Mouja Pilakpur, Nagpur (Rural), admeasuring 4.62 Acres i.e. 1.86 H.R land. The plaintiff entered into an agreement to purchase the land admeasuring 0.81 H.R. i.e. 2 Acre of land from North-West corner of the said land after laying boundary mark ‘Dhura’ over the said land. It is the case of the plaintiff that he is in business of Real Estate Development. He agreed to purchase the property of the defendants. The defendants agreed to sell the portion of land which he has received in oral partition and was in possession of said property. One Motiram Eknath Aakre was possessing 36 Acres of land. It is the case of plaintiff that the property was partitioned by Motiram in between his sons. It was oral partition. In view of the partition, the mutation entries were recorded reflecting said oral partition. Handwritten document is filed on record i.e. “Aapasat Jaminicha Watap”. In the said partition, the defendant No.1 received 4 and 1/2 Acres of land. The Memorandum of the Family Arrangement i.e. partition was signed by all the parties to the partition and was duly acted upon. The relevant 7/12 extracts, however, were not showing partition in respect of the owners but the defendants were in possession of their respective shares.
The defendant No.1 was in need of money as he was dismissed from his service and in order to meet litigation expenses and education expenses he decided to sell out some portion out of his property. The defendant No.1 was represented as an absolute owner of the suit property and assured that there shall not be any impediment in transferring the property. Accordingly, the terms and conditions were finalized and reduced into writing on 07.09.2005 and the plaintiff has paid Rs.75,000/- towards part consideration and balance consideration of Rs.10,25,000/- was to be paid within a period of three years from the date of agreement to sell i.e. on or before 07.03.2008.
The defendant No.1 agreed to indemnify against all adverse claims arising on account of any defect in his title. The defendant Nos.1 to 4 also executed a Consent Letter, the Deed of Confirmation on the same day. As per the agreement, the plaintiff was under an obligation to make payment of balance consideration of Rs.10,25,000/- within a period of three years. The defendant and his wife approached the plaintiff from time to time and demanded various amounts towards part payment of balance consideration. During 07.09.2025 to 30.10.2005 the plaintiff has paid an amount of Rs.80,000/- which is duly acknowledged on the agreement of sale itself. Even thereafter on several occasions the defendants demanded money. Lastly he made payment of Rs.17,000/- by cheque and in cash towards consideration of suit property and till 31.08.2007 an amount of Rs.3,53,500/- have been paid to the defendants from time to time. The plaintiff was ready and willing to perform his part of contract by paying remaining consideration, however, the defendants failed to perform their part of contract. The plaintiff, therefore, issued notice dated 04.03.2008 which was replied by the defendants on 17.03.2008 and defendants have falsely claimed therein that the suit property is an ancestral property and is not partitioned and, therefore, the consent of co-owners is necessary. The defendants have claimed that they are not under an obligation to execute the sale deed. As such, the defendants have resiled from performing their part of contract. Hence the plaintiff has solicited the decree for specific performance of contract in his favour.
The defendants have denied their ownership over the suit property, however, admitted that it was Motiram who was owner of 36 Acts of land. The theory of oral partition is denied. Similarly it is denied by the defendant No.1 that he got any share in the partition.
It is not in dispute that defendant No.1 was working as a Bus Conductor in M.S.R.T.C. and was dismissed from service which was challenged by him by filing a complaint. However, defendants denied that they were in need of any money for meeting expenses of litigation and, therefore, they agreed to sell the suit property for consideration of Rs.11,00,000/-.
It is alleged that the defendant No.1 was facing financial stringency, therefore, he was in need of money towards maintenance. Therefore, he used to take money on interests from the plaintiff and the signature of the defendant were obtained on some blank papers. He has never entered into an agreement of sale of suit property at any point of time. The transaction in question is a money lending transaction and the defendant No.1 is ready and willing to refund the said amount. It is alleged that the market value of the suit property at the time of filing of written statement was Rs.40,00,000/- and it was Rs.25,00,000/- per Acre in the year 2005. Therefore, by taking disadvantage of the situation, the plaintiff advanced loan. Mainly on these grounds amongst others, prayed to dismiss the appeal.
It is the contention of the learned Counsel for the appellants that the plaintiff was required to establish a valid, concluded and enforceable contract for sale of the immovable property and could not succeed merely by proving the execution of a document or receipt of money. According to the appellants, endorsement of receipt of amounts, even if proved, did not conclusively establish that the amounts were paid towards sale consideration, particularly when the specific defence was that the amounts were advanced as a loan/financial accommodation. It is, therefore, contended that the defendant No.1 could not, without establishing exclusive title or a valid partition, agreed to convey a specifically demarcated portion of the joint/common property so as to bind the other co-sharers. The appellants submitted that the Consent Memorandum relied upon by the plaintiff could not, by itself, confer title upon defendant No.1 or validate an alienation beyond the interest legally possessed by him. It is submitted that the plaintiff sought an equitable relief of specific performance in respect of the valuable agricultural land after a substantial lapse of time. The alleged transaction was for Rs.11,00,000/- whereas the plaintiff claims to have paid only Rs.3,53,500/- up to 31.08.2007, leaving a balance Rs.7,46,500/-. It is pointed out that substantial rise in the value of property and the passage of time were relevant circumstances while considering whether discretionary relief of specific performance ought to be granted. The document i.e. the agreement to sell expressly acknowledged the proposed sale of 2 Acres portion and recorded Consent of the executants together with understanding not to raise any objection, claim or legal proceedings in respect thereof. It was, therefore, submitted that the subsequent attempt to dispute the transaction was contrary to the contemporaneous documentary record.
After considering the submissions of both the parties, and questions formulated it appears that the plaintiff relies upon the Agreement of Sale dated 07.09.2005 (Exh.35), whereby defendant No.1 agreed to sell approximately 0.81 H.R., equivalent to two acres, out of Khasra No.31/6, Mouza Pilkapar, for Rs.11,00,000/-, claiming that the said portion had fallen to his exclusive share in an oral partition effected by his father Motiram in 1996. The appellants dispute such exclusive entitlement and contend that the property continued to remain joint, with defendant No.1 having, at the highest, an undivided interest therein. In such situation Section 44 of the Transfer of Property Act, 1882 comes in picture which permits a co-owner to transfer his undivided share, but the transferee can acquire only the right and interest possessed by the transferor, including the right to seek partition. Thus, unless the particular two-acre portion is shown to have fallen exclusively to defendant No.1 by a valid partition or otherwise, he could not confer exclusive title thereto upon the plaintiff.
Effect of transfer of undivided share in joint family property is considered by Hon’ble Apex Court in Kartar Singh v. Harjinder Singh, (1990) 3 SCC 517 wherein the Supreme Court has recognised that a co-owner can agree to sell his undivided share in the joint property. The absence of other co-sharers from such transaction does not, by itself, render the transaction void. The purchaser, however, steps into the shoes of the vendor and acquires only the interest which the vendor was competent to transfer. In Surinder Singh v. Kapoor Singh (Dead) through LRs., (2005) 5 SCC 142, the Supreme Court reiterated the said principle and recognised that an agreement entered into by one co-sharer can be enforced to the extent of the share of the contracting co-owner. The purchaser is required to work out his rights in respect of the undivided property through partition.
The distinction between an agreement concerning an undivided share and an agreement concerning a specific portion of joint property is therefore material. In M.V.S. Manikayala Rao v. M. Narasimhaswami, AIR 1966 SC 470, the Supreme Court held that a purchaser of an undivided share acquires the interest of the transferor and is entitled to work out his rights by partition. Similarly, in Ramdas v. Sitabai, (2009) 7 SCC 444, it has been held that a co-sharer may transfer his undivided share, but a particular portion of the joint property cannot be treated as exclusively belonging to him unless the property has been partitioned.
In the present case, the plaintiff seeks specific performance of the Agreement of Sale (Exh.35) not merely to the extent of the undivided share of defendant No.1, but in respect of an identified portion of approximately two acres out of Khasra No.31/6. The claim, therefore, necessarily rests upon the alleged oral partition of 1996 and the assertion that the said portion had fallen exclusively to the share of defendant No.1. Though absence of mutation, by itself, does not disprove an oral partition, the alleged exclusive allotment must be established by cogent and reliable evidence.
The pleadings in RCS No.557 of 2015, Exh.53, the evidence regarding possession and enjoyment and the conduct of the family members are relevant for determining whether the alleged partition was accepted and acted upon. Mere silence or absence of objection of the other family members cannot, by itself, amount to proof of partition or relinquishment of their rights; what is material is whether their conduct recognised the alleged allotment and exclusive possession of defendant No.1. On cumulative consideration of the material on record, this Court finds that the plaintiff has established that the particular two-acre portion was exclusively allotted to defendant No.1 to confer upon him an exclusive and transferable right therein.
The aforesaid conclusion also assumes significance in view of the defence of defendant No.1 that the transaction was, in substance, not a money-lending arrangement. The payments allegedly made by the plaintiff, the circumstances in which they were made, the substantially higher market value of the property and the evidence of the supporting witness, who did not witness the alleged payments between 07.03.2005 and 06.09.2005, are relevant circumstances while determining the true nature and genuineness of the transaction. If at all defendants are of the view that they have availed loan from the plaintiff and have not entered into sale agreement and if such being a case, there was no impediment for defendants to execute mortgage deed instead of executing sale agreement. Story of blank papers signed by the defendants is not proved.
The Consent Letter/Memorandum dated 07.09.2005 may be considered as evidence of the conduct and understanding of the persons who executed it.
The principles laid down in Rameshbhai Ramjibhai Sorathiya v. Dilipbhai Kalyanji Patel, AIR 2019 GUJ 194, and Major General Darshan Singh (Dead) through LRs. v. Brij Bhushan Chaudhary (Dead) through LRs., Civil Appeal No.9360 of 2013, decided on 01.03.2024, make it clear that a co-sharer can bind himself only to the extent of his legally transferable interest and relief can be moulded accordingly. As per the oral partition all the family members are in possession of demarcated share and from said share he has agreed to sell 2 Acres of land to the plaintiff. Defendant No.1 confer upon him an exclusive right over the particular two-acre portion agreed to be sold to prejudice the rights of the remaining co-sharers. The defence that the transaction was a money-lending transaction is not proved though disparity between market value and agreed consideration, by itself, cannot defeat specific performance in view of Narinderjit Singh v. North Star Estate Promoters Ltd., (2012) 5 SCC 712, such circumstance may be considered along with the evidence regarding payment and the surrounding conduct of the parties. In the present case, however, the principal impediment to the relief claimed is to establish the exclusive entitlement of defendant No.1 to the specific portion of joint family property. The Courts below have considered the Agreement of Sale, the alleged oral partition, Exh.53, the consent memorandum and the evidence regarding payment, and their concurrent findings, being based on the material available on record, cannot be said to be perverse or founded on no evidence. Hence, I pass the following order:-
ORDER
The Second Appeal is dismissed.
The judgment and decree dated 22.10.2019 passed by the learned District Judge-10, Nagpur in Regular Civil Appeal No.110 of
2016, confirming the judgment and decree dated 27.02.2014 passed by the learned Civil Judge, Senior Division, Nagpur in Special Civil Suit No.448 of 2008, are hereby confirmed.
The decree for specific performance passed by the learned Trial Court shall stand maintained in terms of the judgment and decree dated 27.02.2014.
In view of the dismissal of the Second Appeal, all pending applications, if any, stand disposed of.
There shall be no order as to costs.