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IN THE HIGH COURT OF KARNATAKA, BANGALORE

DATED THIS THE 5th DAY OF OCTOBER 2012

BEFORE

THE HON'BLE MRS.JUSTICE B.S. INDRAKALA

RSA.No.3505/2006

BETWEEN:

Sri. Parameshwarappa,
S/o.Honnappa
Since dead by his L.Rs

1. Smt. Girijamma
W/o.Late Parameshwarappa
Aged 60 years

2. Sri. Honnappa,
S/o.late Parameshwarappa
Aged 40 years

3. Smt. Honnamma
D/o.late Parameshwarappa
Aged 37 years

4. Sri. Shadakshari
S/o.late Parameshwarappa
Aged 29 years

5. Sri. Prabhu
S/o.late Parameshwarappa
Aged 24 years
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6. Sri. Nagaraja
S/o.late Parameshwarappa
Aged 20 years

7. Jyothi
D/o.late Parameshwarappa
Aged 18 years

All are residents of

Malleshwara Village
Kasaba Hobli, Kadur Taluk
Chikmagalur District-577 548
… APPELLANTS

(By Sri.K.V.Narasimhan, Advocate)

AND:

Sri. G.Krishnamurthy, 64 years

S/o. Late Gundojirao
R/o.Kadur Town, Kadur-577 548
Chikmagalur District
...RESPONDENT
(By Sri.S.G.Bhagavan, Advocate)

-0-0-0-0-

This RSA is filed under Section 100 of CPC against

the judgment and decree dated 21.4.2006 passed in
R.A.No.75/20002 on the file of the Presiding Officer,
Fast Track Court, Kadur, allowing the appeal and
reversing the judgment and decree dated 21.10.2002
passed in O.S.No.374/1987 on the file of the Addl. Civil
Judge (Jr.Dn), Kadur.
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This appeal coming on for hearing, the same

having been heard and reserved for pronouncement of
judgment, the Court delivered the following:-

JUDGMENT

The appellant-plaintiff herein filed O.S.No.374/87

on the file of the Additional Civil Judge(Jr.Dn.), seeking

a declaration that the sale deed executed by him dated

20.8.1984 is nominal, void, never acted upon and

sought cancellation of the same and also for

consequential relief of permanent injunction restraining

the defendant from alienating the property mentioned in

the schedule to the plaint.

2. The said suit was partly decreed holding that

the sale deed executed by the plaintiff in favour of the

defendant was nominal, void and never acted upon by

the judgment dated 21.10.2002. Aggrieved by the said

judgment, the defendant preferred R.A.No.75/02 on the

file of the FTC, Kadur. The said appeal was allowed

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setting aside the judgment passed in the original suit

thereby dismissing the said suit O.S.No.374/87.

3. Aggrieved by the said judgment passed in

RA.No.75/02 the plaintiff since deceased represented by

his legal representatives filed the present second appeal

inter-alia contending amongst other grounds that the

first appellate Court erred in not appreciating the

evidence in proper perspective, has further contended

that the substantial question of law involved in this

appeal is as to whether the appreciation of evidence and

documents by the first appellate Court is perverse and

the whether first appellate Court was justified in

reversing the judgment and decree of the trial Court etc.

4. For the sake of convenience, the parties herein

are referred to by their respective rank as appellant-

plaintiff and respondent-defendant as arrayed before

the Court of the first instance.

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5. O.S.No.374/94 was filed by the plaintiff

alleging that as his brother who was unemployed

wanted to purchase a lorry during February 1984, he

entered into an agreement with one B.K. Ibrahim of

Mangalore to purchase the lorry bearing Regn.No.CNX

6003 for sale consideration of Rs.2,00,000/-; he paid

Rs.20,000/- as advance on the date of the agreement

and took possession of the said lorry from him.

Further, it is contended that the balance of sale

consideration of Rs.40,000/-was to be paid by the end

August 1984 and the remaining Rs.1,40,000/- to be

paid by the plaintiff towards the loan installments of the

hire purchase account with Canara Bank.

6. It is specifically alleged that the plaintiff was

running short of money; after taking possession of the

lorry, his brother was running the said lorry for hire and

the defendant was using the said lorry for

transportation of stone from the quarry. Further it is

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alleged that the plaintiff approached the defendant for a

loan of Rs.25,000/- on 30.7.1984 so as to pay the

balance sale consideration of the sale price of the lorry

to which the defendant agreed to advance Rs.25,000/-

and got executed an on demand promissory note from

the plaintiff; it was further agreed between the parties

that the defendant was entitled to adjust the lorry hire

charges towards the said loan and the balance if any

was to be paid by the plaintiff with interest at 18% per

annum. Thereafter, the defendant deducted Rs.350/- which

was due by the plaintiff as hand loan and paid loan amount

of Rs.24,650/- to the loan amount of the plaintiff by

issuing cheques drawn on SBM, dated 30.7.1984 and

10.8.1984 for a sum of Rs.17,400/- and Rs.7,250/-

respectively in favour of one B.K. Khader, the brother of

the said B.K. Ibrahim. It is further stated that the said

cheques were so issued at the instance of the plaintiff’s

request with regard to the loan amount of Rs.25,000/-

advanced by the defendant; however, on presentation of

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the said cheques, the same were bounced and when the

defendant enquired the plaintiff as to why the said

cheques were dishonoured the plaintiff told the

defendant that he needs one and half months time to

adjust the amount due to unforeseen financial

restraints; the defendant demanded further security of

the immovable property for the aforesaid loan on the

ground that the amount was huge and he was not

prepared to hand over the cheques unless the plaintiff

furnishes adequate security of immovable property.

Further it is contended that as demanded by the

defendant, the plaintiff executed a registered sale deed

with respect to the schedule property with an assurance

by the defendant that the sale deed is only a nominal

deed for the purpose of security and that he would

reconvey the property as soon as the loan is cleared;

thus, the plaintiff executed a nominal sale deed in

favour of the defendant for the sale consideration of

Rs.10,000/- on 20.8.1984, but, even subsequently the

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cheques were dishonoured and the plaintiff was unable

to fulfill the conditions; as such the said B.K. Ibrahim

cancelled the agreement and took possession of the

lorry from the plaintiff by forfeiting the initial advance

paid. In the circumstances, the plaintiff requested the

defendant to reconvey the schedule property as the loan

consideration had failed; the defendant went on

postponing the event by giving appeasing reply; On

4.12.1984 there was a panchayath and the defendant

agreed to reconvey the property in favour of the plaintiff

by executing two sale deeds, one in favour of the brother

of the plaintiff Yellappa and another in favour of the wife

of the plaintiff by name Girijamma; accordingly, stamp

papers were purchased and sale deeds were also written

on the stamp papers, but, the defendant who had

promised to execute the sale deed never turned up and

failed to execute the same for nearly six months; the

plaintiff persisted and demanded the defendant to

execute the sale deed, but, the defendant lodged a

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complaint with Kadur Police making false allegations;

after investigation charge sheet was also filed in

C.C.No.684/85 on the file of the JMFC, Kadur.

However, the said case ended in acquittal on 14.7.1987.

In the circumstances, the plaintiff has filed the above

suit seeking cancellation of the deed as stated supra.

7. As against the case of the plaintiff, the

defendant amongst other grounds pleaded that by

paying sale consideration he obtained the sale deed with

regard to the suit schedule property and he is in

possession; after execution of the sale deed and taking

possession of the property he got the katha transferred

to his name i.e. the property was mutated in his favour

and he is in peaceful possession and enjoyment of the

same ever since the sale and it is also pleaded that the

suit as brought is not maintainable in law.

8. On the basis of the said pleadings the trial

Court framed the following issues:-

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“1.Whether the plaintiff proves that,

the sale deed dated 20.8.1984 in
respect of suit properties in favour of the
defendant is nominal, void, sham,
without consideration and never acted
upon?

2.Whether the plaintiff proves that,

he is in lawful possession of the suit
schedule properties?

3.Whether the plaintiff further proves

that the defendant is interfering with his
possession and enjoyment of the suit
schedule properties?

4.Whether the plaintiff is entitled for

the reliefs prayed for?

5.To what order or decree?”

The plaintiff chose to examine three witnesses out of

whom P.W.1 is one of the L.R. of the plaintiff while

P.Ws.2 is one Basappa and P.W.3 is one B.K. Khader, in

whose favour cheques were issued and got marked the

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documents Exs.P1 to P8. On behalf of the defendant

also three witnesses are examined and the documents

Exs.D1 to D3 are got marked.

9. Heard the arguments.

10. In view of the submissions made, the points

that arise for consideration are :-

“(1)Whether the impugned judgment

and decree passed in R.A.No.75/02 on
the file of the FTC, Kadur is liable to the
set aside?

(2)What order?”

11. The learned counsel for the appellant

submitted that the suit filed is well within time as per

the cause of action shown in the plaint which is also

duly substantiated by adducing evidence. Further, it is

contended by the learned counsel for the appellant that

the said sale deed was only a nominal sale deed

executed as security for the loan availed by him from

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the defendant and the said sale deed was never acted

upon etc. He also narrated in detail with regard to the

pleadings put forth by the plaintiff as to how and under

what circumstances the said sale deed was executed.

12. Learned counsel for the appellant further

contended that under the sale deed there is no passing

of consideration and there is no delivery of possession of

the property to the purchaser; in other words, the

contents of the sale deed is not acted upon and further,

he submitted that in the said circumstances, as

possession was not delivered, seeking possession of the

property does not arise and as such the suit is not hit

by Section 34 of the Specific Relief Act. With regard to

limitation, he further submitted that the limitation

starts to run when the plaintiff refused to reconvey the

property.
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13. Learned counsel for the appellant relying

upon the decision rendered in BADAT AND

CO.,BOMBAY vs EAST INDIA TRADING CO. (1963

STPL(LE) 2549 SC contended that under Order VIII Rule

3, it is not sufficient for the defendant in his written

statement to deny in general the grounds alleged by the

plaintiff but he must specifically deny each allegation of

fact of which he does not admit the truth except

damages, mere evasive written statement will not be

sufficient to substantiate the case of the defendant. In

the said decision, it is observed as hereunder:

11. Order VII of the Code of Civil

Procedure prescribes, among others, that
the plaintiff shall give in the plaint the facts
constituting the cause of action and when
it arose, and the facts showing that the
court has jurisdiction. The object is to
enable the defendant to ascertain from the
plaint the necessary facts so that he may
admit or deny them. Order VIII provides
for the filing of a written-statement, the
particulars to be contained therein and the
manner of doing so; Rules 3,4 and 5
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thereof are relevant to the present enquiry

and they read:

Order VIII R.3. It shall not be

sufficient for a defendant in his written
statement to deny generally the grounds
alleged by the plaintiff, but the defendant
must deal specifically with each allegation
of fact of which he does not admit the
truth, except damages.

R.4 Where a defendant denies an

allegation of fact in the plaint, he must not
do so evasively, but answer the point of
substance. Thus if it is alleged that he
received a certain sum of money, it shall
not be sufficient to deny that he received
that particular amount, but he must deny
that he received that sum or any part
thereof, or else set out how much he
received. And if an allegation is made with
diverse circumstances, it shall not be
sufficient to deny it along with those
circumstances.

R.5. Every allegation of fact in the

plaint, if not denied specifically, or by
necessary implication or stated to be not
admitted in the pleading of the defendant,
shall be taken to be admitted except as
against a person under disability.

Provided that the Court may in its

discretion require any fact so admitted to
be proved otherwise than by such
admission.
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These three rules form an integrated

code dealing with the manner in which
allegations of fact in the plaint should be
traversed and the legal consequences
flowing from its non-compliance. The
written statement must deal specifically
with each allegation of fact in the plain and
when a defendant denies any such fact, he
must not do so evasively, but answer the
point of substance. If his denial of a fact
is not specific but evasive, the said fact
shall be taken to be admitted. In such
an event, the admission itself being
proof, no other proof is necessary.

Thus contended that on the allegations made with

regard to the availing of loan for purchase of lorry to the

brother of the plaintiff and also the circumstances

under which the cheques were issued to one Khader

and how they were bounced are not denied specifically,

which has to be construed as having been proved by the

plaintiff.

14. On perusal of the written statement, it is seen

that no doubt as contended by the learned counsel for

the appellant, the defendant has not specifically

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traversed the said facts except stating that all those

allegations are extraneous to the suit transaction.

15. Learned counsel for the appellant relied upon

another decision rendered in SUHRID SINGH @

SARDOOL SINGH vs RANDHIR SINGH & AMP; Ors

rendered in Civil Appeal Nos.2811-2813/2010 dated

29th March 2010 and contended that as the plaintiff is

the executant of the alleged document, the sale deed,

suffice it if he seeks only the declaration that the deed is

invalid non-est or illegal or it is not binding on him and

he need not seek cancellation.

16. On perusal of the plaint, it is seen that the

plaintiff not only sought declaration that the sale deed

in question is nominal void or never acted upon but he

has also sought cancellation of the said sale deed. In

the foregoing circumstances, the said decision is of no

relevance.
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17. As against the said submission of the

learned counsel for the appellant the counsel appearing

for the respondent submitted that basically the suit is

hit by limitation and also hit by the proviso to Section

34 of the Specific Relief Act. Further, he contended that

the substantial questions of law involved in the

proceedings can be formulated not only at the stage of

admission of the second appeal, but, also subsequently

at any time during the course of hearing of the appeal

and as such two more substantial questions of law that

require to be adjudicated upon in this appeal are that

(i) Whether the suit filed beyond three years from the

date of sale deed namely 20.8.1984 is well within

the time prescribed under the Limitation Act?

(ii) Whether mere declaration sought to declare the

sale deed as null and void without seeking

consequential relief of possession which fact flows

from the document itself is maintainable in view of

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the provisio to Section 34 of the

Specific Relief Act?

18. With regard to one of the substantial

question of law which requires to be considered is

irrespective of whether defendant specifically pleaded in

his written statement or not, do arise in the case i.e.,

with regard to limitation, it is seen that as nowhere in

the document in question, anything is stipulated with

regard to performance of any part of the contract by the

defendant, it cannot be said that the Article 54 of

Schedule to the Limitation Act is applicable.

Admittedly, as discussed supra, the suit is for

declaration that the sale deed is invalid and for

cancellation. Thus, the said 2 reliefs are bound by

Articles 58 and 59 mentioned in the schedule to the

Limitation Act, 1963 which reads as under:

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Description of Period of Time from which

Suit limitation period begins to
run

58. To obtain any Three yrs When the right to

other decla- sue first accrues
ration

PART – IV SUITS RELATING TO DECREES AND

INSTRUMENTS

59.To cancel or set

aside an instrument Three yrs When the facts
or decree or for entitling plaintiff
the recission to have the instru-
of a contract ment or decree
cancelled or set
aside or the
contract rescinded
first become known
to him
_____________________________________________________

19. It is the specific case of the plaintiff that as

on the date of the execution of the alleged sale deed

itself, the same was executed as a security for the loan

availed by him in the circumstances detailed in the

plaint in which event, it has to be held that right to sue

first accrued on the date of execution of the said

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document itself and hence, under Article 58 the plaintiff

ought to have filed the suit within three years from the

said date.

20. With regard to applicability of Article 59

regarding cancellation of the document, it is seen that

the facts entitling the plaintiff to have the instrument

cancelled also arose on the date of the execution of the

sale deed. In this regard, further it has to be seen that

as there is no covenant in the sale deed with regard to

reconveyance of the property, it cannot be said that

their existed any contract casting burden upon the

defendant to perform so as to fix the date of

commencement of limitation as the date when the

contract rescinded first became known to him. Thus, in

the circumstance of the case, when the plaintiff

executed the sale deed as only a security and it was a

nominal sale deed, dishonour of cheque subsequently

on 15.9.1994, when he got written two sale deeds on

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stamp papers on 14.12.1994, will not stop the limitation

which has already begun to run and such act does not

amount to acknowledgement so as to hold that a fresh

period of limitation can be computed from the said date.

In other words, that will not renew the period of

limitation and it cannot also be said that there is any

further renewal of limitation by act of parties as

contemplated under the Limitation Act.

21. The cause of action is described as

20.8.1984 the date of execution of the sale deed,

15.9.1984 when cheques were dishonoured and

4.12.1994 – when two sale deeds were written, last week

of July 1997 when the defendants refused to reconvey.

In this regard, it is to be seen that on perusal of the sale

deed, the cheques were not the subject of consideration

in the said sale deed. It is clearly mentioned that the

amount was received by the vendor in cash. Thus, the

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said dishonour of cheque cannot be linked to the

transaction dated 20.8.1984.

22. On perusal of Exs.P.6 and P.7, the cheques

are said to have been issued for sale consideration

under Ex.P.1 and D.1, it is seen that the same are dated

30.7.1984 and 10.8.1984 i.e., much earlier to the date

of execution of the sale deed on 20.8.1984. Besides, in

both the cheques it is seen that the same are having the

printed year relating ‘60; in other words, the same have

the printed format as date ………. 196.. and the dates

read as 19684 which also gives room for suspecting the

bonafides of both the drawer and the drawee. Be that

as it may. Nothing is mentioned in the sale deed about

the cheques and thus, the said dishonour of cheque

cannot be linked to the transaction dated 20.8.1984.

23. With regard to the preparing a draft of the

sale deeds as per Exs.P.2 and 3 and also the affidavits

thereon marked as Exs.P.4 and P.5, it is seen that

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nothing is mentioned with regard to the nature of

Ex.P.1. In other words, it is seen that it is also like an

out and out sale deed. Thus, the sale also does not give

any continuity to the original sale deed besides

admittedly, Exs.P.2 to P.5 are not signed by the

defendant. Thus, the same also cannot bind the

defendant and the same also cannot renew the period of

limitation. Hence, the above suit is filed beyond the

period of limitation prescribed.

24. With regard to another substantial question

of law as to the applicability of the proviso to Section 34

of Specific Relief Act as discussed supra, admittedly it is

seen that under the document in question the property

is said to have been delivered to the purchaser besides

the defendant has also chosen to file certified copies of

mutation register extract, RTC extract, patta book etc.

which all discloses that the defendant was put in

possession under the said sale deed dated 20.8.1984.

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The defendant has also filed tax paid receipts,

endorsement issued by the DCC Bank as Ex.D.34 which

discloses that it is a no-due certificate issued with

regard to the lands so purchased by him – Ex.P.1 and

Ex.D.1. Thus, it cannot be said that the defendant was

not put in possession of the property. Besides, on

perusal of the plaint it is also seen that it is not the case

of the plaintiff that the defendant was interfering with

his possession. On the other hand, he has sought the

consequential relief of injunction restraining the

defendant from alienating the schedule property.

25. In the foregoing circumstances, considering

the nature of prayer sought, the contents of the

documents which is under challenge under which the

property is alleged to have been delivered to the

purchaser and also the contents of the documents got

marked by the defendant disclosing his possession over

the property, the contention of the learned counsel for

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the respondent that under proviso to Section 34 of the

Specific Relief Act, the suit should fail for not seeking

further relief of possession inasmuch as under the said

proviso, it is clear that no Court can make any such

declaration where the plaintiff will be able to seek title

omits to do so. Thus, the said suit is also hit by Section

34 of the Specific Relief Act.

26. With regard to the other substantial question

of law formulated by this Court at the time of admission

that, “Whether the contention of the appellants that the

sale deed that was set up by the defendant could be

called a nominal sale deed and if so, what are the

circumstances that are required to be established in

challenging the judgment impugned” is also answered

holding that the lower appellate court has discussed at

length with regard to the said aspects by appreciating

both oral and documentary evidence placed on record

and the same does not call for any interference. Hence,

the following:
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ORDER

The above appeal is dismissed.

Sd/-
JUDGE

Brn