Case Note & Summary
The litigation arose from a suit for specific performance of an agreement of sale pertaining to agricultural land measuring 11 acres 21 guntas situated in Bagganadu Kaval village, Hiriyur Taluk, Chitradurga District. The plaintiff, Beereddy Dasaratharami Reddy, represented by his General Power of Attorney holder Mettu Anji Reddy, filed O.S.No.91/2007 before the Senior Civil Judge, Hiriyur, seeking a direction against defendants No.1 (K. Veluswamy) and No.2 (V. Manjunath), father and son, to execute a registered sale deed in respect of the suit schedule properties upon receiving the balance sale consideration. The plaintiff claimed that both defendants jointly agreed to sell the suit property for a total consideration of Rs.29,00,000/-. An advance of Rs.1,00,000/- was allegedly paid in cash to defendant No.2 on 3.12.2006, for which defendant No.2 issued a written acknowledgment. Subsequently, on 8.12.2006, defendant No.1 and his wife executed a written sale agreement in favour of the plaintiff after receiving a further advance of Rs.4,00,000/-, thus the total advance paid was Rs.5,00,000/-. The plaintiff alleged that after entering into the agreement, he requested the defendants to clear an encumbrance noted in favour of State Bank of Mysore and to provide a sketch copy of the property. The defendants assured compliance but later avoided execution. Despite the plaintiff's readiness and willingness to pay the balance of Rs.24,00,000/-, the defendants failed to execute the sale deed. Upon learning that the defendants were attempting to sell the property to third parties at a higher price, the plaintiff issued two legal notices, but to no avail. Therefore, he filed the suit. Defendant No.1, in his written statement, denied the agreement's validity, contending that the transaction was actually a loan of Rs.4,00,000/- taken from the plaintiff at 12% interest, and the agreement of sale was executed as a security for the loan. He further claimed that the property is joint family property, with his daughter Roopa also having a coparcenary interest, and that he had no absolute right to sell. He stated that defendant No.2 was not on cordial terms with the family and had no involvement in the alleged agreement; he never signed, and the plaintiff had taken advantage of the situation. Defendant No.2, in his separate written statement, echoed these contentions, specifically denying that he ever received any advance of Rs.1,00,000/- or issued an acknowledgment. He asserted that he was residing and working in Bangalore and had no knowledge of the suit until recently, as his address was falsely shown as Adivala village. He further alleged collusion between the plaintiff, his parents, and their supporters to deprive him of his share in the property, which was worth over Rs.50,00,000/-. Both defendants sought dismissal of the suit. The trial court framed four issues: whether the defendants agreed to sell; whether defendant No.2 received Rs.1,00,000/- as earnest money and issued an acknowledgment; whether defendant No.1 received Rs.4,00,000/- and executed the agreement; and whether the plaintiff was ever ready and willing to perform his part of the contract. After a full trial, the court decreed the suit on 22.01.2013, directing defendant No.1 to execute the sale deed upon receiving the balance consideration of Rs.25,00,000/- from the plaintiff within two months. Aggrieved by the decree, defendant No.2 filed Regular First Appeal No.498/2013 under Section 96 of the Code of Civil Procedure, 1908, before the Karnataka High Court. The appeal was heard by a Division Bench comprising Justice B. Veerappa and Justice Ravi V. Hosmani. The appellant argued that he was not a signatory to the agreement and therefore could not be bound, while the respondent defended the decree. The High Court heard the arguments and delivered judgment.
Issue of Consideration
Whether the trial court correctly decreed specific performance of the agreement of sale dated 08.12.2006, and whether defendant No.2, who was not a signatory to the agreement, could be bound by it.
