“Where there is a sale of the same property in favour of a prior and subsequent transferee and the subsequent transferee has, under the conveyance outstanding in his favour, paid the purchase­money to the vendor, then in a suit for specific performance brought by the prior transferee, in case he succeeds, the question arises as to the proper form of decree in such a case. The practice of the Courts in India has not been uniform and three distinct lines of thought emerge. According to one point of view, the proper form of decree is to declare the subsequent purchase void as against the prior transferee and direct conveyance by the vendor alone. A second considers that both vendor and vendee should join, while a third would limit execution of the conveyance to the subsequent purchaser alone. According to the Supreme Court, the proper form of decree is to direct specific performance of the contract between the vendor and the prior transferee and direct the subsequent transferee to join in the conveyance so as to pass on the title which resides in him to the prior transferee. He does not join in any special covenants made between the prior transferee and his vendor; all he does is to pass on his title to the prior transferee.”

“Where there is a sale of the same property in

favour of a prior and subsequent transferee

and the subsequent transferee has, under the

conveyance outstanding in his favour, paid

the purchase­money to the vendor, then in a

suit for specific performance brought by the

prior transferee, in case he succeeds, the

question arises as to the proper form of

decree in such a case. The practice of the

Courts in India has not been uniform and

three distinct lines of thought emerge.

According to one point of view, the proper

form of decree is to declare the subsequent

purchase void as against the prior transferee

and direct conveyance by the vendor alone.

A second considers that both vendor and

vendee should join, while a third would limit

execution of the conveyance to the

subsequent purchaser alone. According to

the Supreme Court, the proper form of decree

is to direct specific performance of the

contract between the vendor and the prior

transferee and direct the subsequent

transferee to join in the conveyance so as to

pass on the title which resides in him to the

prior transferee. He does not join in any

special covenants made between the prior

transferee and his vendor; all he does is to

pass on his title to the prior transferee.”

Hon’ble Mr. Justice Abhay Manohar Sapre

     REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL No.5177 OF 2009

Vijay A. Mittal & Ors. ….Appellant(s)

VERSUS

Kulwant Rai (Dead) Thr. LRs.

& Anr. …Respondent(s)

J U D G M E N T

Abhay Manohar Sapre, J.

  1. This appeal is directed against the final judgment

and order dated 21.12.2007 passed by the High Court

of Punjab & Haryana at Chandigarh in RSA No.1537 of

1993 whereby the Single Judge of the High Court

dismissed the regular second appeal filed by the

appellants herein and upheld the judgment/decree

1

dated 15.04.1993 of the First Appellate Court in C.A.

No.7 of 15.02.1992.

  1. In order to appreciate the controversy involved in

this appeal, it is necessary to set out the relevant facts

hereinbelow.

  1. Appellant Nos.1 to 4 and 7 are the legal

representatives of the original defendant No.1­Amar

Nath. Appellant No.5 (Yash Pal Mittal), who was the

original defendant No.2 also died and he is now

represented by his legal heirs (i) Rita Mittal (ii)

Akanksha and (iii) Akshay Mittal and Appellant No.6

(Sunil Mittal) is the original defendant No.3 whereas

respondent No.1 (Kulwant Rai) is the original plaintiff,

who also died and is now represented by his legal heirs

(i) Sudesh Goel, (ii) Ajay Goel and (iii) Sanjay K. Goel

and respondent No.2 (Atul Kumar) is the original

plaintiff No.2 in the civil suit out of which this appeal

arises.

2

  1. In short, the civil suit out of which this appeal

arises was originally filed by one ­ Kulwant Rai as

plaintiff No.1 and Atul Kumar as plaintiff No.2 against

the defendants, namely, (1) Amar Nath, (2) Yash Pal

Mittal, (3) Sunil Mittal and (4) Bal Kishandas.

  1. During the pendency of the civil suit, Kulwant

Rai (Plaintiff No.1), Amar Nath (defendant No.1) and

Yashpal Mittal (defendant No.2) died and, therefore,

their legal representatives, on whom the right to sue

devolved as detailed above, were brought on record in

places of the original plaintiff/defendants in the civil

suit to enable them to continue the lis on behalf of

those who died.

  1. As mentioned above, two aforementioned

plaintiffs (respondents herein) filed a civil suit against

the aforementioned four defendants (appellants herein)

on 19.03.1982 claiming a relief of specific performance

of the agreement dated 12.06.1979 in relation to the

suit property (as detailed in the plaint) situated at

3

Narain Dass Building, Durga Charan Road, Ambala

Cantt.

  1. The suit was founded on the agreement dated

12.06.1979 entered into between the plaintiffs and the

defendant No.1 (Amar Nath) for sale of the suit

property for a sum of Rs.46,000/­. According to the

plaintiffs, they paid a sum of Rs.5,000/­ by way of

earnest money to defendant No.1 (Amar Nath) and the

sale deed in relation to the suit property was to be

executed on or before 31.12.1979 by defendant No.1

(Amar Nath) in favour of the plaintiffs on paying the

balance consideration before the sub­Registrar.

  1. It was alleged that defendant No.1 (Amar Nath)

instead of selling the suit property to the plaintiffs in

terms of agreement dated 12.06.1979 sold it to

defendant Nos. 2 and 3 on 27.11.1981. The plaintiffs

alleged that they were ready to perform their part of

the agreement but it was defendant No.1 (Amar Nath)

who failed to perform his part and committed breach

4

by selling the suit property to defendant Nos. 2 and 3

on a higher price and, therefore, the plaintiffs were

constrained to file the suit for seeking specific

performance of the agreement dated 12.06.1979.

  1. Defendant No.1 (Amar Nath) died and, therefore,

he could not file his written statement. His legal

representatives, however, filed the written statement.

Their defense was three­fold.

  1. First – Amar Nath (defendant No.1) was not the

absolute owner of the suit property because the suit

property was a Joint Hindu Family property; Second,

Amar Nath (defendant No.1) was, therefore, not

competent to enter into an agreement to sell the suit

property; and the Third, the sale in question was not

for any legal necessity and, therefore, it was bad in law

and not binding on the legal representatives because

their consents were not obtained by Amar Nath

(defendant No.1) prior to entering into an agreement of

sale.

5

  1. So far as defendant Nos. 2 to 4 are concerned,

they filed their written statement. They admitted that

the suit property belonged to Amar Nath(defendant

No.1). They averred that they purchased the suit

property from Amar Nath pursuant to the agreement,

which they had entered into with him somewhere in

the year 1978. They alleged that they had no

knowledge of the agreement of the plaintiffs and,

therefore, they were bona fide purchasers of the suit

property.

  1. The Trial Court by judgment/decree dated

22.11.1991 dismissed the suit. It was held that the

agreement dated 12.06.1979 is proved; the plaintiffs

were ready and willing to perform their part of the

agreement but since Amar Nath was not competent to

enter into the agreement with the plaintiffs because

the suit property was a Joint Hindu Family property

and Amar Nath was only a Karta; and lastly, the

6

Plantiffs failed to aver that the sale was for the legal

necessity and for the benefit of the family.

  1. The plaintiffs felt aggrieved and filed appeal

before the First Appellate Court. By judgment/decree

dated 15.04.1993, the First Appellate Court allowed

the appeal, set aside the judgment/decree of the Trial

Court and decreed the plaintiffs’ suit.

  1. The First Appellate Court held that the sale deed

executed by Late Amar Nath in favour of defendant

Nos. 2 and 3 was bad in law inasmuch as the same

was obtained by a collusion so as to deprive the

plaintiffs of the fruits of their agreement dated

12.06.1979. It was also held that defendant Nos. 2

and 3 were not bona fide purchaser of the suit

property. It was also held that the suit property was

Joint Hindu family property and Amar Nath was its

Karta. It was also held that the agreement of sale

entered into by Amar Nath was binding on all

coparceners.

7

  1. The defendants, therefore, felt aggrieved and filed

the second appeal before the High Court. By

impugned order, the High Court dismissed the second

appeal and upheld the judgment/decree of the first

Appellate Court.

  1. It was held that Amar Nath executed the

agreement dated 12.06.1979 as a Karta of Joint Hindu

Family. It was also held that the agreement was

binding on Amar Nath and his legal representatives.

  1. It is against this order, the defendants have

carried the matter to this Court in special leave to

appeal.

  1. Having heard the learned counsel for the parties

and on perusal of the record of the case, we find no

merit in this appeal.

  1. In the first place, in our considered opinion,

when the three Courts below have held against the

defendants and in favour of the plaintiffs that the

plaintiffs were ready and willing to perform their part

8

of the agreement, this finding was binding on the High

Court and also on this Court.

  1. Indeed, the Trial Court had already recorded this

finding in plaintiffs’ favour but since the Trial Court

dismissed the suit on other grounds, the defendants

had a right to challenge this finding by filing cross

objection before the First Appellate Court in plaintiffs’

appeal but the defendants did not do so and accepted

this finding. The First Appellate Court while decreeing

the plaintiffs’ suit upheld this finding being not under

challenge and the High Court upheld it by dismissing

defendants’ second appeal.

  1. A finding on the issue of readiness and

willingness is one of the important and relevant

findings in a suit for specific performance of an

agreement. It is a finding based on facts and once it is

recorded, it becomes a finding of fact.

  1. In this view of the matter, unless such finding is

found to be against the pleadings or contrary to the

9

evidence or the law governing the issue, it is binding

on the High Court and also on this Court.

  1. Learned counsel for the appellants was not able

to point out any infirmity or illegality in this finding. It

is apart from the fact that the appellants (defendants)

failed to challenge its legality and correctness at the

first appellate stage in an appeal filed by the plaintiffs,

which was the appropriate stage to challenge. It is,

therefore, binding on this Court.

  1. The other argument of learned counsel for the

appellants (defendants) was that since the respondents

(plaintiffs) got impleaded only some legal

representatives out of eight legal representatives of late

Amar Nath in their first appeal and remaining legal

representatives were not impleaded, the decree of the

Trial Court dismissing the civil suit qua those legal

representatives, who were not made parties in the

appeal, had become final.

10

  1. It was, therefore, urged that the First Appellate

Court by allowing the appeal filed by the plaintiffs and

decreeing their suit has passed two conflicting

decrees­one against some which has decreed the suit

and other against some which has resulted in

dismissal of the suit. It is not legally permissible.

  1. This submission was dealt with by the High

Court while answering 5th substantial question and

was rejected. In our view, the High Court was right for

the following reasons.

  1. First, all the legal representatives of late Amar

Nath were already on record in the Trial Court in the

suit and all had taken similar defense in support of

their case against the plaintiffs. In other words, there

was no conflict of interest amongst them either inter se

or qua the plaintiffs.

  1. Second, those legal representatives, who filed the

written statement, had filed a joint and common

written statement whereas those, who did not file the

11

written statement, had given their power of attorney in

favour of the legal representatives, who had filed the

written statement.

  1. Third, one legal representative, who did not file

his written statement remained ex­parte. In these

circumstances, it was not necessary to implead him

as party respondent in the first appeal.

  1. Fourth, it is a trite law that if out of all the legal

representatives, majority of them are already on record

and they contested the case on merits, it is not

necessary to bring other legal representatives on

record. The reason is that the estate and the interest

of the deceased devolved on the legal representatives is

sufficiently represented by those who are already on

record.

  1. Fifth, the defendants, who were respondents in

the first appeal, did not raise any objection before the

First Appellate Court. Had such objection been raised,

the appellants (plaintiffs) would have cured the defect

12

by impleading them as party respondents before the

First Appellate Court.

  1. As rightly argued by the counsel for the

respondents, the reason for not impleading some legal

representatives in the first appeal was that their

names were not shown in the decree of the Trial Court.

It was for this reason, the first appeal was filed by the

plaintiffs only against those legal representatives

whose names were shown in the decree.

  1. In the light of this factual scenario and the

reasons set out above, we are of the considered

opinion that no case was made out by the appellants

to challenge the decree before the High Court on the

ground that the impugned decree has resulted in

passing any conflicting decree by the First Appellate

Court ­ one of dismissal of the suit by the Trial Court

and the other decreeing the suit by the First Appellate

Court.

13

  1. Learned counsel for the appellants (defendants)

then argued that the two Courts below were not

justified in declaring the sale made in favour of

defendant Nos. 2 and 3 by defendant No.1 as bad in

law. According to the learned counsel, it should have

been held to be a bona fide sale for consideration

without notices to the agreement of the plaintiff with

defendant No.1.

  1. We find no merit in this submission for more

than one reason. First, the finding on this issue being

a concurrent finding of fact recorded against the

appellants by the Appellate Court and the High Court,

the same is binding on this Court.

  1. Second, the finding apart from being concurrent

is otherwise not liable to be interfered with for the

reason that the sale made by defendant No.1 in favour

of defendant Nos. 2 and 3 was on the face of it, a

collusive sale made to avoid the agreement of the

plaintiffs.

14

  1. Third, defendant Nos. 2 and 3 did not adduce any

evidence to prove that their agreement was prior in

point of time as against the agreement of the plaintiffs

and, therefore, they were entitled to get the sale deed

executed pursuant to their prior agreement.

  1. Fourth, the legal representatives of Amar Nath

having stepped into his shoes were entitled to raise

that defense which was available to Amar Nath against

the plaintiffs in addition to one which was appropriate

to their character as legal representatives as provided

under Order 22 Rule 4(2) of the Code of Civil

Procedure, 1908.

  1. Fifth, the plaintiffs were only entitled to prove the

existence of the valid agreement with the defendant

No.1 – Amar Nath and its performance by the plaintiffs

qua him. This finding of readiness and willingness was

recorded in plaintiffs’ favour throughout.

  1. The Trial Court had framed two Issues (7 and 8)

on the questions as to whether the suit property was a

15

Joint Hindu Family property of Amar Nath and, if so,

whether Amar Nath was its Karta or not. The Trial

Court held that the suit property was the Joint Hindu

Family property of which Amar Nath was its Karta.

  1. This Court in a case Sunil Kumar & Anr. vs.

Ram Parkash & Ors., (1988) 2 SCC 77 examined the

status and the powers of a Karta while dealing with

the Joint Hindu Family property in the following

words.

“6. In this appeal we are called upon to

decide the only question whether a suit for

permanent injunction restraining the Karta

of the joint Hindu family from alienating the

house property belonging to the joint Hindu

family in pursuance of the agreement to sell

executed already in favour of the predecessor

of the appellants, Jai Bhagwan, since

deceased, is maintainable. It is well settled

that in a Joint Hindu Mitakshara Family, a

son acquires by birth an interest equal to

that of the father in ancestral property. The

father by reason of his paternal relation and

his position as the head of the family is its

Manager and he is entitled to alienate joint

family property so as to bind the interests of

both adult and minor coparceners in the

property, provided that the alienation is

made for legal necessity or for the benefit of

the estate or for meeting an antecedent debt.

The power of the Manager of a joint Hindu

16

family to alienate a joint Hindu family

property is analogous to that of a Manager for

an infant heir as observed by the Judicial

Committee in Hunoomanpersaud Panday v.

Mussumat Babooee Munraj Koonweree (1856)

6 Moo Ind App 393)”

  1. Keeping in view the aforementioned principle of

law and applying the same to the facts of the case at

hand, we are of the considered opinion that the Courts

below were justified in holding that the agreement

dated 12.6.1979 was binding on the legal heirs of

Amar Nath for the following reasons:

  1. First, no issue was framed on the question of

“legal necessity”. In our opinion, it should have been

framed; Second, yet the First Appellate Court while

allowing the plaintiffs’ appeal recorded a categorical

finding that one son of Amar Nath had signed the

agreement in question and, therefore, it was a case

where legal representatives of Late Amar Nath were

aware of the existence of the agreement and also had

given their consent; and Third, this finding was upheld

17

by the High Court while dismissing the defendants’

appeal.

  1. One cannot dispute the power of a Karta to sell

the Joint Hindu Family property. It is, indeed,

inherent in him. However, it is subject to certain

restrictions, namely, the sale should be for the legal

necessity and for the benefit of the family.

  1. It is clear that Amar Nath had obtained the

consent of the legal heirs before entering into an

agreement for sale of the suit property to the plaintiffs.

The very fact that one son of Amar Nath was a

signatory to the agreement was sufficient to draw a

presumption that the agreement to sell was made by

Amar Nath with the consent of other coparceners. It is

also for the reason because none of the coparceners

had raised any objection till the filing of written

statement in the suit. The very fact that Amar Nath

sold the suit property to defendant Nos. 2 and 3 and

which was not objected to by his legal heirs showed

18

that the plea regarding legal necessity had no factual

basis to sustain.

  1. It is for all these reasons, we are of the view that

the appellants (defendants) have failed to make out

any case so as to call for any interference in the

impugned judgment.

  1. This takes us to examine another question which

arises in this case but was not taken note of by the

Courts below while decreeing the suit. It relates to the

nature of decree to be passed in this case.

  1. The question arises in this way. The effect of

the decree passed in this case is that the original

defendant No.1, now represented by his legal

representatives (Appellant Nos.1­4 & 7) along with

legal representatives of original defendant No. 2, i.e.,

(i) Rita Mittal, (ii) Akanksha and (iii) Akshay Mittal,

and defendant No. 3 (Appellant No.6 herein) are

required to execute the sale deed in favour of legal

representatives of original plaintiff No.1, i.e.,

19

respondent No.1(i) Sudesh Goel, (ii) Ajay Goel and

(iii) Sanjay K. Goel and Atul Kumar, plaintiff No.2

(respondent No.2 herein) jointly.

  1. Yet another effect of the decree is that the

transaction of sale of suit property between original

defendant No.1, now represented by his legal

representatives (Appellant Nos.1­4 & 7) and

defendant No.2 (Appellant No.5 herein), now

represented by his legal representatives and

defendant Nos.3(Appellant No.6 herein) is declared

bad in law and stands nullified. As a consequence

thereof, legal representatives of defendant

No.1(Appellant Nos.1­4 & 7) are required to return

Rs.48,000/­ to original defendant No.2 (appellant

No.5 herein), now represented by his legal

representatives and defendant No.3 (appellant No.6

herein) in the absence of any contract to the

contrary in this behalf between the parties. The

reason being that once the sale is declared bad, the

20

transaction of sale fails and, therefore, the

seller(defendant No.1) has no right to retain the sale

consideration with himself and has to refund the

sale consideration to the buyers(defendant Nos.2 &

3) [See Section 65 of the Indian Contract Act].

  1. The question arose before this Court in the

case of Lala Durga Prasad & Anr. Vs. Deep Chand

& Ors., AIR 1954 SC 75 as to what form of decree

should be passed in the case of specific performance

of contract where the suit property is sold by the

defendant, i.e., the owner of the suit property to

another person and later he suffers a decree for

specific performance of contract directing him to

transfer the suit property to the plaintiff in term of

contract.

  1. The learned Judge­Vivian Bose, J. examined

this issue and speaking for the Bench in his

inimitable style of writing, held as under:

21

“Where there is a sale of the same property in

favour of a prior and subsequent transferee

and the subsequent transferee has, under the

conveyance outstanding in his favour, paid

the purchase­money to the vendor, then in a

suit for specific performance brought by the

prior transferee, in case he succeeds, the

question arises as to the proper form of

decree in such a case. The practice of the

Courts in India has not been uniform and

three distinct lines of thought emerge.

According to one point of view, the proper

form of decree is to declare the subsequent

purchase void as against the prior transferee

and direct conveyance by the vendor alone.

A second considers that both vendor and

vendee should join, while a third would limit

execution of the conveyance to the

subsequent purchaser alone. According to

the Supreme Court, the proper form of decree

is to direct specific performance of the

contract between the vendor and the prior

transferee and direct the subsequent

transferee to join in the conveyance so as to

pass on the title which resides in him to the

prior transferee. He does not join in any

special covenants made between the prior

transferee and his vendor; all he does is to

pass on his title to the prior transferee.”

  1. We, therefore, consider it just and proper and

with a view to end this litigation between the

parties, which is pending since 1982 and also to

balance the equities amongst the parties that

defendant No.1 through his legal representatives

22

(Appellant Nos. 1­4 & 7 herein) would return a sum

of Rs.48,000/­ to the legal representatives of

defendant No.2 (Appellant No.5 herein) and

defendant No. 3 (Appellant No.6 herein). This

direction we give by taking recourse to our powers

under Article 142 of the Constitution of India to do

complete justice between the parties to the lis

because we do not want another round of litigation

to go on for years in future between the defendants

inter se for recovery of this amount.

  1. In the light of the foregoing discussion, the

appeal is disposed of by modifying the judgment

and decree as under:

(i) The legal representatives of defendant No.1

(Appellant Nos.1­4 and 7) shall deposit a sum of

Rs. 48,000/­ in the executing Court for being paid

to the legal representatives of defendant No.2, i.e.,

(i) Rita Mittal, (ii) Akanksha and (iii) Akshay Mittal

23

and Defendant No.3 (Appellant No.6 herein) within

three months as an outer limit.

(ii) The legal representatives of original Plaintiff

No.1,(respondent No.1 herein) i.e., (i) Sudesh Goel,

(ii) Ajay Goel, and (iii) Sanjay K. Goel and Atul

Kumar, plaintiff No.2 (respondent No.2 herein) shall

deposit in the executing Court a sum of Rs.41,000/­

for being paid to the legal representatives of original

Defendant No.1 (Appellant Nos.1 to 4 and 7 herein)

within three months as an outer limit.

(iii) The original defendant No.1, now represented

by his legal representatives (Appellant Nos.1­4 & 7)

along with legal representatives of original

defendant No. 2 and defendant No. 3 (Appellant

No.6 herein) will jointly execute the sale deed in

favour of legal representatives of original plaintiff

No.1, i.e., respondent No.1 herein (i) Sudesh Goel,

(ii) Ajay Goel and (iii) Sanjay K. Goel and Atul

Kumar, plaintiff No.2 (respondent No.2 herein) and

24

hand over the possession of the suit property to

them simultaneously and then will withdraw the

money deposited for them in Court.

  1. The executing Court will ensure completion of

proceedings within the time fixed and record due

satisfaction of the decree in accordance with law. In

case of any default, the parties will be entitled to

put the decree in execution for enforcement of the

terms of the decree of this Court amongst the

defaulting parties.

  1. In view of the foregoing discussion, the appeal

stands disposed of.

      ………...................................J.

   [ABHAY MANOHAR SAPRE]



…...……..................................J.

            [INDU MALHOTRA]

New Delhi;

January 28, 2019

25