Supreme Court of India
LAKHA SINGHversusBALWINDER SINGH & ANR.
- Citation
- 2024 INSC 744
- Decided
- 27 September 2024
- Disposal
- Appeal(s) allowed
Holding
The Supreme Court held that the lower courts' findings were perverse, the agreement was fraudulent, and therefore quashed the judgments, allowing the appeal.
Summary
The appellant, Lakha Singh, contested a civil suit filed by the respondent, Balwinder Singh, for specific performance of an agreement to sell agricultural land and for the recovery of Rs.16,00,000 earnest money. The trial court held the transaction to be a loan rather than a sale and ordered the appellant to refund the earnest money, a decision affirmed by the first appellate court and the High Court. The appellant argued that the agreement was a fraudulent concoction, pointing to irregularities such as the use of blank stamp paper, missing signatures on the first two pages, and the implausibility of the payment terms. The Supreme Court examined whether the lower courts' findings were perverse and whether interference under Article 136 was warranted. Finding that the evidence demonstrated a clear fraud and that the lower courts had misread material documentary evidence, the Court held the judgments to be perverse. Consequently, the Supreme Court allowed the appeal, quashed the earlier judgments, and ordered a fresh decree in favour of the appellant.
Issues considered
- Whether the disputed agreement to sell was a genuine contract or a fraudulent concoction.
- Whether the lower courts erred in characterising the transaction as a loan and in refusing specific performance.
- Whether the appellant is liable to refund the earnest money paid by the respondent.
- Whether the Supreme Court can interfere with the concurrent findings of the lower courts under Article 136 of the Constitution.
Legislation cited
- Constitution of Indias. Article 136
Subjects
contractspecific performanceearnest moneyfraudagreement to sellArticle 136misreading evidenceconcurrent findingsloan transactioncivil procedure
Judgment
[2024] 10 S.C.R. 79 : 2024 INSC 744
Lakha Singh
v.
Balwinder Singh & Anr.
(Civil Appeal No. 10893 of 2024)
27 September, 2024
[Pamidighantam Sri Narasimha and Sandeep Mehta,* JJ.]
Issue for Consideration
Whether the entire case of the respondent-plaintiff regarding
execution of the disputed agreement; alleged payment of
Rs.16,00,000/- in cash to the appellant-defendant and alleged
appearance of the respondent-plaintiff in the office of sub-registrar
in the purported exercise of getting the sale deed executed in terms
of the disputed agreement was fraud and concoction.
Headnotes†
Contract – Specific Performance – Respondent filed a suit for
specific performance of an agreement to sell in respect of an
agricultural plot of land – In alternative, respondent-plaintiff,
inter-alia, sought relief of recovery of Rs.19,00,000/- including
the amount of Rs.16,00,000/- paid as earnest money on the date
of execution of the disputed agreement – Trial Court allowed
the suit partly, directing recovery of Rs.16,00,000/- and denied
the prayer of specific performance – The first appeal as well
as the second appeal preferred by the appellant-defendant
were rejected – Correctness:
Held: In the instant case, the stamp papers were not purchased by
the appellant-defendant nor respondent-plaintiff – The document
was typed out in Gurmukhi language and the photostat copy
thereof is available on record – The disputed agreement runs
into 3 pages – The signature of the respondent-plaintiff, and the
thumb impression of the appellant-defendant are marked only
on the last page thereof – The first and second pages of the
agreement, do not bear the signature of the respondent-plaintiff
or the thumb impression of the appellant-defendant – There exist
significant blank spaces at the foot of the first two pages below the
transcription typed out on these two pages – These observations
give rise to a strong inference fortifying the contention of the
* Author
80 [2024] 10 S.C.R.
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appellant-defendant’s counsel that the thumb impression of the
appellant-defendant may have been taken on a blank stamp paper
and the disputed agreement was typed thereon subsequently –
Respondent-plaintiff did not take permission from his department
before entering into an agreement to sell of such a high value –
According to the disputed agreement, appellant-defendant agreed
to sell his land @ Rs.5,00,000/- per Killa, which was half of the
market rate of the land – Going by the rate fixed, the total sale
consideration of the land would have been Rs.18,87,000/- –
However, the disputed agreement recites that appellant-defendant
had received an earnest money of Rs.16,00,000/-, which is
lion’s share of the total sale consideration – Therefore, it does
not stand to reason that why respondent-plaintiff would defer
execution of sale deed to a date almost 16 months later, when
only 15% of the total value was remaining – Thus, the disputed
agreement i.e., the agreement to sell is highly suspicious – As far
as appearance of respondent-plaintiff in the sub-registrar office is
concerned, admittedly, the respondent-plaintiff did not give any
advance intimation to the appellant-defendant imploring him to
receive the balance consideration and execute the sale deed
on the scheduled date i.e. 19.09.2008 or anytime thereafter –
Instead, he directly proceeded to file the subject suit in the
month of December, 2008 wherein, alternative prayers, one for
the execution of the sale deed and the other for the refund of
the earnest money were made – The factors enumerated above,
are sufficient for this Court to conclude that the entire case of
the respondent-plaintiff regarding the execution of the disputed
agreement; the alleged payment of Rs. 16,00,000/- in cash to the
appellant-defendant on 07.05.2007 and the alleged appearance
of the respondent-plaintiff in the office of the Sub-Registrar in the
purported exercise of getting the sale deed executed in terms
of the disputed agreement is nothing but a sheer piece of fraud
and concoction. [Paras 27, 28, 29, 31, 36]
Case Law Cited
Sukhbiri Devi v. Union of India [2022] 13 SCR 523 : 2022 SCC
OnLine SC 1322; Mekala Sivaiah v. State of A.P. [2022] 6 SCR
989 : (2022) 8 SCC 253 – relied on.
List of Keywords
Contract; Specific performance; Earnest money; Disputed
agreement; Refund of earnest money; Fraud; Concoction; Sale
[2024] 10 S.C.R. 81
Lakha Singh v. Balwinder Singh & Anr.
deed; Execution of sale deed; Article 136 of the Constitution;
Misreading of material documentary evidence; Concurrent findings
of fact.
Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 10893 of 2024
From the Judgment and Order dated 25.04.2018 of the High Court of
Punjab & Haryana at Chandigarh in RSA No. 4577 of 2017
Appearances for Parties
Ankit Goel, Nikhil Sharma, Sahil Patel, Advs. for the Appellant.
M/s. Lex Regis Law Offices, Sunil Kumar Jain, Ms. Reeta Chaudhary,
Advs. for the Respondents.
Judgment / Order of the Supreme Court
Judgment
Mehta, J.
1. Heard.
2. Leave granted.
3. This appeal by special leave is directed against the judgment
dated 25th April, 2018 rendered by the High Court of Punjab and
Haryana at Chandigarh, whereby the second appeal1 preferred by
the appellant-defendant was dismissed, and the judgment dated
20th March, 2017 passed by the learned Additional District Judge,
Tarn Taran2 in Civil Appeal3 was affirmed. The First Appellate Court
dismissed the Civil Appeal preferred by the appellant-defendant and
upheld the judgment and decree dated 18th February, 2013 passed
by the learned Additional Civil Judge (Senior Division), Patti, Tarn
Taran4 in Civil Suit5 filed by the respondent-plaintiff. The trial Court
allowed the suit partly, directing the recovery of Rs. 16,00,000/- and
the interest accrued thereupon from the appellant-defendant by way
1 RSA No. 4577 of 2017(O&M).
2 ‘First Appellate Court’.
3 Civil Appeal No. 05 of 2016.
4 ‘trial Court’.
5 Civil Suit No. 535 of 2008.
82 [2024] 10 S.C.R.
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of alternative relief of recovery while denying the prayer of specific
performance sought for by the respondent-plaintiff.
4. The facts in a nutshell relevant and essential for disposal of the
appeal are noted hereinbelow.
5. The respondent-plaintiff filed the subject suit in the trial Court seeking
a decree for specific performance of an agreement to sell dated 7th
May, 20076 in respect of an agricultural plot of land admeasuring
30 Kanals 8 Marlas7 located at Village Amrike, Tehsil Patti, District
Tarn Taran, Punjab. Besides the relief of specific performance, the
respondent-plaintiff also sought permanent injunction for restraining
the appellant-defendant from alienating the suit land and dispossessing
the respondent-plaintiff from the same. In the alternative, respondent-
plaintiff sought relief of recovery of Rs.19,00,000/- including the
amount of Rs.16,00,000/- paid as earnest money on the date of
execution of the disputed agreement along with the damages to the
tune of Rs.3,00,000/-.
6. The respondent-plaintiff averred in the plaint that the appellant-
defendant, being the owner of the suit land, had agreed to sell
the same to the respondent-plaintiff vide the disputed agreement
wherein, the rate of the land was fixed at Rs.5,00,000/- per Killa
with a condition to get the sale deed executed and registered on
19th September, 2008. As per the recitals in the disputed agreement,
the appellant-defendant received a sum of Rs.16,00,000/- by way of
earnest money on the date of the execution of the agreement with
a further stipulation that the balance consideration would be paid
on 19th September, 2008, when both the parties would appear at
the Registrar office. It was further stipulated that if on the said date,
the appellant-defendant failed to execute the registered sale deed
then, he would become liable to return the earnest money to the
tune of Rs.16,00,000/- along with penalty of equal amount, totalling
to Rs.32,00,000/- to the respondent-plaintiff. Even after receiving
the money and the penalty, the respondent-plaintiff would be entitled
to file a suit for getting the sale deed executed in his favour. This
disputed agreement was attested by two witnesses namely, Major
Singh (PW-4) and Balwinder Singh (PW-2).
6 ‘disputed agreement’.
7 ‘suit land’.
[2024] 10 S.C.R. 83
Lakha Singh v. Balwinder Singh & Anr.
7. It was also averred in the plaint that a part of the property was under
mortgage with respondent No. 2 i.e. The State Bank of Patiala.
The respondent-plaintiff claimed that he reached the Office of
Joint Registrar, Khem Karan on the date stipulated in the disputed
agreement i.e. 19th September, 2008 and remained present there
from 09:00 am to 05:00 pm waiting for the appellant-defendant to
arrive. However, the appellant-defendant did not turn up to get the
sale deed registered in favour of the respondent-plaintiff, thereby
violating the terms and conditions of the agreement. As such, the
respondent-plaintiff got an affidavit of attendance attested from the
Executive Magistrate, Khem Karan, who was also discharging the
duties of the Joint Sub-Registrar, Khem Karan. In this manner, the
respondent-plaintiff claimed to have marked his presence before
the Joint Sub-Registrar showing his readiness and willingness to
get the sale deed executed and registered in his favour, in terms of
the disputed agreement.
8. Respondent-plaintiff further averred in the plaint that the appellant-
defendant had breached the terms of the disputed agreement and
was not ready and willing to execute and get the sale deed registered
despite numerous requests, being made. The respondent-plaintiff also
averred that the possession of the land, was handed over to him at
the time when the disputed agreement was executed and that the
respondent-plaintiff continued to remain in possession of the suit land
as a prospective vendee. Apprehending that the appellant-defendant
could alienate the suit land in favour of some other person, thereby
dispossessing him, the respondent-plaintiff filed the subject suit8
seeking reliefs in the following terms: -
“It is therefore respectfully prayed that a decree for Specific
Performance of Agreement to sell dated 7.5.2007 with
regard to land measuring 30 Kanals 8 Marlas detail of
which is as follows:
a. Land measuring 12 Kanals 14 Marlas i.e. 4/72 share
of land measuring 229 Kanals 5 Marlas bearing Khata/
Khatoni No. 153 /372 to 379, Rectangle and Killa
Nos. 31//14//1, 20, 21, 32//15, 17,327/24, 25, 337/5,
31/722, 347/9, 2,31//12, 13, 19, 317/2671, 327/16,
8 Civil Suit No. 535 of 2008
84 [2024] 10 S.C.R.
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337/74, 6, 7, 14,15,16, 25, 347/1, 10,20,44//5, 32//4,
5,6,7.8/1, 14/2, 32/714/1, 337/17
b. Land measuring 7 Kanals 17 Marlas i.e. 1/3rd share
of land measuring 23 Kanals 10 Marlas bearing
Khata/Khatoni No. 153/374, Rectangle and Killa Nos.
327/22, 34/79,2.
c. Land measuring 9 Kanals 17 Marlas i.e. 4/72 share
of land measuring 170 Kanals 10 Marlas bearing
Khata/Khatoni No. 101/243, 244/, 244.1 246, 102/246
Rectangle and Killa Nos. 31/ /11, 8/2, 19/22/221//14,
15, 16, 17, 24, 25, 22//2, 3/1, 10/2, 22//9, 11,12, 19,
20, 21, 22, 31//1,2,10 min (6-16), 32//1,2.21/211/9,10
nub, (1-4), 21//22,23,32//3/1, situated in village Amrike
Tehsil Patti district Tarn Taran as per Jamabandi 2002-
2003 on payment of Rs.3,00,000/- or any sum which
this Hon’ble Court finds due and for execution and
registration of sale deed and for delivery of symbolic
actual possession of above land to the plaintiff with
consequential relief of permanent injunction thus,
restraining the defendant no. 1 from alienating the
suit land with anybody in any way, except the plaintiff
and also restraining the defendant no. 1 forever from
dispossessing the plaintiff forcibly from land measuring
30 Kanals 8 Marlas bearing Khasra No. 31//14/1 min
(1-0), 20, (7-16), 21 (8-32)/715 (7-12), 327//17 (7-0)
situated at Village Amrike, Tehsil Patti, District Tarn
Taran as per Jamabandi for the year 2002 - 03 and
also restraining the defendant no. 1 from interfering in
the peaceful possession of the plaintiff over the same.
In the alternative, suit for recovery of Rs.19,00,000/-
detailed as follow:
a) Amount of earnest money paid on 7.5.2007 at the
time of execution of agreement i.e., Rs.16,00,000/-.
b) Amount of damage and compensation for breach of
contract dated 7.5.2007 of Rs. 3,00,000/-, totalling to
Rs. 19,00,000/- be passed in favour of plaintiff and
against the defendant No.1 with costs.
[2024] 10 S.C.R. 85
Lakha Singh v. Balwinder Singh & Anr.
Any other relief to which the plaintiff is found entitled to
that may also kindly be granted in favour of plaintiff.”
9. The appellant-defendant, upon being summoned, appeared before the
trial Court and filed a written statement denying the averments made
in the plaint. It was specifically averred in the written statement filed
by the appellant-defendant that the disputed agreement was without
consideration, result of misrepresentation, impersonation and must
have been prepared fraudulently by the respondent-plaintiff who was
an employee of the Punjab police, posted as the Head Constable
at Amritsar by colluding with the scribe and the attesting witnesses.
10. It was further alleged that the respondent-plaintiff’s brother was a
commission agent and ran a commission business at Mandi, Amarkot.
The appellant-defendant used to sell his agricultural produce through
the commission agency of the respondent-plaintiff’s brother. The
appellant-defendant was an illiterate simpleton and the respondent-
plaintiff, and his brother used to get the thumb impressions of the
customers/agriculturists including the appellant-defendant on blank
stamp papers. It was specifically asserted in the written statement
that the disputed agreement had been prepared by fraudulent means
on one of such blank stamp papers, on which the thumb impression
of the appellant-defendant had been taken by deceitful means. The
appellant-defendant also denied the receipt of sale consideration from
the respondent-plaintiff and asserted that he was not bound by the
disputed agreement. A plea was also made by the appellant-defendant
that the market rate of agricultural land in Village Cheema Khurd was
not less than Rs.12,00,000/- per Killa and that there was no reason
for the appellant-defendant to have sold his valuable land to the
respondent-plaintiff at a throw away rate of Rs.5,00,000/- per Killa,
more particularly as the suit land was his only source of livelihood.
11. A pertinent plea was also taken by the appellant-defendant that
the suit for specific performance of the disputed agreement and for
permanent injunction, was bad for non-joinder of necessary parties
because all the co-sharers of the suit land were not arrayed as parties
in the subject suit. Based on aforesaid pleadings of the parties, the
trial Court framed the following issues for determination: -
“1. Whether the defendant no. 1 executed an agreement
to sell dated 7.5.2007 regarding land measuring 30
Kanals 8 Marlas in favour of the plaintiff? OPP.
86 [2024] 10 S.C.R.
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2. Whether the plaintiff is entitled for specific performance
of agreement to sell? OPP.
3. Whether the plaintiff is entitled in the alternative to
recover Rs.19,00,000/- from the defendant no. 1?
OPP.
4. Whether the plaintiff and defendant no. 1 were owner/
co-sharer in possession to the extent of his share in
the disputed property? OPP.
5. Whether the plaintiff is entitled to the relief of
permanent injunction as prayed for? OPP.
6. Whether the suit is maintainable in the present form?
OPP.
7. Whether the plaintiff has locus standi to file the
present suit? OPP.
8. Whether the cause of action arisen to the plaintiff for
filing of present suit? OPP.
9. Whether the suit is bad for non-joinder of necessary
parties? OPP.
10. Whether the plaintiff has not come to the court with
clean hands? OPD.
11. Whether the plaintiff is estopped by his own act and
conduct from filing the present suit? OPD.
12. Relief.”
12. The issue No.2(supra) regarding entitlement of the respondent-
plaintiff for specific performance of the disputed agreement and the
affiliated issue No. 5(supra) for the relief of permanent injunction
were decided against the respondent-plaintiff. However, issue
No.3(supra) regarding the alternative relief seeking recovery of the
amount to the tune of Rs. 19,00,000/- was partly decided in favour
of the respondent-plaintiff and partly against him. The trial Court
recorded the following findings: -
a. It was an admitted fact that the appellant-defendant was the
owner of the suit land and respondent-plaintiff while appearing
[2024] 10 S.C.R. 87
Lakha Singh v. Balwinder Singh & Anr.
as PW-1 produced on record the agreement to sell,9 duly signed
by the appellant-defendant.
b. The respondent-plaintiff testified that the appellant-defendant
had agreed to sell the suit land in his favour and received a
sum of Rs. 16,00,000/- as earnest money with a condition to
execute the sale deed on 19th September, 2008.
c. On the date fixed as per the disputed agreement, the appellant-
defendant failed to appear at the office of the Sub-Registrar
whereas the respondent-plaintiff got his presence marked by
way of an affidavit attested by the Executive Magistrate-cum-
Sub-Registrar, Khem Karan.
d. The version of the respondent-plaintiff was also corroborated
by the attesting witnesses namely, Major Singh (PW-4) and
Balwinder Singh (PW-2).
e. That the respondent-plaintiff had proved the execution of the
disputed agreement and his willingness to get the sale deed
executed by cogent evidence.
f. That the possession of the suit land was never handed over
to the respondent-plaintiff although this fact was mentioned in
the disputed agreement.
g. That the person who pays a huge amount and fixes a long date
for the execution of the sale deed, would not be expected to
wait for possession to be taken in future. However, in the case
at hand, the date fixed for the execution of the sale deed was
after a period of about a year and four months from the date
of the execution of the disputed agreement.
13. Based on the aforesaid findings, the trial Court concluded that the
transaction between the parties appeared to be a loan transaction
rather than an agreement for sale and purchase of the property
and held that the respondent-plaintiff was not entitled to the relief
of specific performance of the agreement in respect of the suit land.
However, the respondent-plaintiff was held to be entitled to recover
the earnest money paid to the appellant-defendant at the time of
the execution of the agreement along with interest.
9 ‘disputed agreement’
88 [2024] 10 S.C.R.
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14. The trial Court decreed the suit vide judgment dated 18th February,
2013 and directed the appellant-defendant to refund the earnest
money to the tune of Rs. 16,00,000/- with pendente lite interest
@ 9% per annum and future interest @ 6% per annum to the
respondent-plaintiff.
15. As noted above, the first appeal as well as the second appeal preferred
by the appellant-defendant against the judgment and decree rendered
by the trial Court stood rejected by the First Appellate Court and the
High Court, respectively vide judgments dated 20th March, 2017 and
25th April, 2018. These judgments are subjected to challenge in this
appeal by special leave.
16. Shri Ankit Goel, learned counsel for the appellant-defendant,
vehemently and fervently contended that the findings of facts recorded
by the Courts below, though concurrent, are perverse on the face of
the record and thus, it is a fit case warranting interference by this
Court in exercise of the jurisdiction conferred by Article 136 of the
Constitution of India.
17. To buttress the above contention, learned counsel for the appellant-
defendant, drew the Court’s attention to the following excerpts from
the cross-examination of the respondent-plaintiff (PW1): -
“Amarjit Singh S/o Massa Singh is my real brother. He is
running a commission agent shop at Amarkot, and the name
of the commission agent shop is Cheema Trading Company,
at Amarkot. I know Lakha Singh from my childhood. He
belongs to my village. I do not know whether Lakha Singh
deft sold his agriculture produce through the commission
agent shop of my brother Amarjit Singh. I am posted as Head
constable in Punjab Police and now posted at Ludhiana
at Division no. 11nd. The agreement was scribed at Patti
by a typist, but I do not know his name.
Possession was not delivered on the basis of agreement to
sell. It was mentioned in the agreement that the possession
will be delivered on the agreement but the defendant
refused to deliver the possession of the land agreed to
sold the land to me.
I file the income tax return because I am employee
of Punjab Govt. I have not shown the amount of
[2024] 10 S.C.R. 89
Lakha Singh v. Balwinder Singh & Anr.
Rs.16,00,000/- in my income tax return. It is correct
if any Govt. employee want to purchase any land it is
necessary to get the permission from their department. I
have not taken any permission from my department before
purchasing the agreement to sell with the defendant not I
show any amount of Rs. Sixteen lakh to my department.
It is correct that agriculture income also not shown in my
income tax return. I have never shown my agricultural
income in my income tax return.
This amount was not withdrawn by me from any bank &
this amount was lying be me in my house.
It is correct that at present the marked rate in vill. Cheema
Khurd Rs. 9/10 lakhs per Killa.
It is also wrong. to suggest that defendant never purchase
the stamp paper through Angrej Singh for execution of
the agreement to sell dated 07-5-2007. It is also wrong
to suggest that agreement is prepared and dated with the
collusiveness of the attesting witnesses. It is also wrong
to suggest defendant never receipt any amount of Rs.16
lakhs from me as earnest money. It is also wrong to suggest
deft use to sell his agriculture produce at that shop of
my brother Amarjit Singh. It is also wrong to suggest my
brother might have got the thumb impression by fraud.”
18. He highlighted and stressed upon the following facts elicited from
the deposition (supra) of the respondent-plaintiff: -
a. The respondent-plaintiff was employed as a Head Constable
in the Punjab Police at the time of the incident.
b. The respondent-plaintiff’s brother was running a commission
agent shop at Mandi Amarkot.
c. Contrary to the recital in the disputed agreement that the
possession of suit land was given to the respondent-plaintiff,
it was admitted by the respondent-plaintiff in his evidence that
the possession of suit land was not handed over to him on the
basis of the disputed agreement.
d. The respondent-plaintiff admitted that he used to file Income
Tax returns being an employee of the Punjab Government, but
90 [2024] 10 S.C.R.
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he did not show the amount of Rs.16,00,000/- in the Income
Tax return.
e. He also admitted that he had not obtained any permission from
the department to purchase the suit land.
f. The respondent-plaintiff admitted that the amount in question
was not withdrawn from any bank and the currency notes used
for the transaction were lying in his house.
g. He also admitted that the market rate of the land in Village
Cheema Khurd was around Rs.9-10 lakhs per Killa.
h. He denied the suggestion given on behalf of the appellant-
defendant that his brother Amarjeet Singh had procured the
thumb impression of the appellant-defendant on blank stamp
papers by fraud.
19. Learned counsel urged that the admissions as appearing in the
testimony of the respondent-plaintiff, completely discredit the version
regarding the execution of the disputed agreement. Therefore, he
submitted that the findings recorded in the judgments of the Courts
below are patently perverse and are based on misreading/ignorance
of the admitted facts available on record and thus, the appeal merits
acceptance and the impugned judgments deserve to be reversed.
20. Per contra, learned counsel representing the respondent-plaintiff,
supported the findings recorded in the impugned judgments. He
urged that the trial Court, the First Appellate Court and the High
Court appreciated and re-appreciated the evidence minutely and
have arrived at an unimpeachable conclusion that the transaction
in question was a loan transaction inter se between the respondent-
plaintiff and the appellant-defendant and thus, the appellant-defendant
was rightly held liable to reimburse the amount of loan secured from
the respondent-plaintiff at the time of the execution of the disputed
agreement. He urged that the law is well settled that this Court whilst
exercising the jurisdiction under Article 136 of the Constitution of
India, would not enter into pure questions of fact so as to reverse
the well-reasoned judgments of the Courts below. On these counts,
learned counsel for the respondent-plaintiff implored the Court to
dismiss the appeal.
21. We have given our thoughtful consideration to the submissions
advanced at bar and have gone through the material placed on record.
[2024] 10 S.C.R. 91
Lakha Singh v. Balwinder Singh & Anr.
22. It is trite law that jurisdiction under Article 136 of the Constitution of
India should not be exercised unless the findings on facts recorded
by the Courts below suffer from perversity or are based on omission
to consider vital evidence available on record.
23. The scope of an appeal by special leave under Article 136 of the
Constitution of India against concurrent findings is well-established.
In the case of Sukhbiri Devi v. Union of India,10 this Court noted:
“3. At the outset, it is to be noted that the challenge in
this appeal is against concurrent findings by three Courts,
as mentioned hereinbefore. The scope of an appeal by
special leave under Article 136 of the Constitution of India
against the concurrent findings is well settled. In State of
Rajasthan v. Shiv Dayal11 reiterating the settled position,
this Court held that a concurrent finding of fact is binding,
unless it is infected with perversity. It was held therein: —
“When any concurrent finding of fact is
assailed in second appeal, the appellant
is entitled to point out that it is bad in
law because it was recorded de hors the
pleadings or it was based on no evidence
or it was based on misreading of material
documentary evidence or it was recorded
against any provision of law and lastly,
the decision is one which no Judge acting
judicially could reasonably have reached.
(see observation made by learned Judge Vivian
Bose, J. as His Lordship then was a Judge of
the Nagpur High Court in Rajeshwar Vishwanath
Mamidwar v. Dashrath Narayan Chilwelkar, AIR
1943 Nag 117 Para 43).”
4. Thus, evidently, the settled position is that interference
with the concurrent findings in an appeal under Article
136 of the Constitution is to be made sparingly, that too
when the judgment impugned is absolutely perverse.
10 [2022] 13 SCR 523 : 2022 SCC OnLine SC 1322
11 [2019] 10 SCR 243 : (2019) 8 SCC 637
92 [2024] 10 S.C.R.
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On appreciation of evidence another view is possible also
cannot be a reason for substitution of a plausible view
taken and confirmed. We will now, bearing in mind the
settled position, proceed to consider as to whether the said
appellate power invites invocation in the case on hand.”
(emphasis supplied)
24. This Court in Mekala Sivaiah v. State of A.P.,12 while dealing with
its power under Article 136 to interfere with concurrent findings held
the following: -
“15. It is well settled by judicial pronouncement that Article
136 is worded in wide terms and powers conferred under
the said Article are not hedged by any technical hurdles.
This overriding and exceptional power is, however, to be
exercised sparingly and only in furtherance of cause of
justice. Thus, when the judgment under appeal has resulted
in grave miscarriage of justice by some misapprehension
or misreading of evidence or by ignoring material evidence
then this Court is not only empowered but is well expected
to interfere to promote the cause of justice.
16. It is not the practice of this Court to re-appreciate
the evidence for the purpose of examining whether the
findings of fact concurrently arrived at by the trial court
and the High Court are correct or not. It is only in rare and
exceptional cases where there is some manifest illegality
or grave and serious miscarriage of justice on account of
misreading or ignoring material evidence, that this Court
would interfere with such finding of fact.
…
18. In Bharwada Bhoginbhai Hirjibhai v. State of Gujarat
[Bharwada Bhoginbhai Hirjibhai v. State of Gujarat,
(1983) 3 SCC 217 : 1983 SCC (Cri) 728], a two-Judge
Bench of this Court held that this Court does not
interfere with the concurrent findings of fact unless
it is established:
12 [2022] 6 SCR 989 : (2022) 8 SCC 253
[2024] 10 S.C.R. 93
Lakha Singh v. Balwinder Singh & Anr.
18.1. That the finding is based on no evidence.
18.2. That the finding is perverse, it being such as no
reasonable person could arrive at even if the evidence
was taken at its face value.
18.3. The finding is based and built on inadmissible
evidence which evidence, excluded from vision, would
negate the prosecution case or substantially discredit
or impair it.
18.4. Some vital piece of evidence which would tilt the
balance in favour of the convict has been overlooked,
disregarded or wrongly discarded.”
(emphasis supplied)
25. Keeping in mind the aforesaid principles, we shall now advert to the
submissions advanced on behalf of the parties with reference to the
findings recorded by the Courts below and the material available
on record.
26. The respondent-plaintiff filed the subject suit with a pertinent assertion
that the disputed agreement was executed by the appellant-defendant
for sale of his agricultural land admeasuring 30 Kanals and 8
Marlas at the rate of Rs.5,00,000/- per Killa. As per the recital in the
agreement, the respondent-plaintiff paid a sum of Rs.16,00,000/- in
cash to the appellant-defendant at the time of the execution of the
disputed agreement.
27. At this stage, a very crucial fact which is noticeable from the
disputed agreement needs to be highlighted. It is not in dispute that
the stamp papers were not purchased by the appellant-defendant
and rather Amarjeet Singh was the person who purchased the
same. The document was typed out in Gurmukhi language and the
photostat copy thereof is available on record. A visual overview of
the disputed agreement would show that it runs into three pages.
The signature of the respondent-plaintiff, and the thumb impression
of the appellant-defendant are marked only on the last page thereof.
The first and second pages of the agreement, do not bear the
signature of the respondent-plaintiff or the thumb impression of the
appellant-defendant. There exist significant blank spaces at the foot
of the first two pages below the transcription typed out on these two
94 [2024] 10 S.C.R.
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pages. These observations give rise to a strong inference fortifying
the contention of the appellant-defendant’s counsel that the thumb
impression of the appellant-defendant may have been taken on a
blank stamp paper and the disputed agreement was typed thereon
subsequently.
28. It cannot be denied that the respondent-plaintiff being a Police
Constable was mandatorily required to seek permission from his
department before entering into an agreement to purchase property
of such a high value. However, admittedly, he did not seek any such
permission from the department. As per the disputed agreement, the
appellant-defendant agreed to sell the suit land to the respondent-
plaintiff @ Rs. 5,00,000/- per Killa, which was just about half of the
market rate of the land at the relevant point of time, as admitted by
the respondent-plaintiff. Going by the rate as fixed in the disputed
agreement, the total sale consideration would have amounted to
approximately, Rs.18,87,000/-. The disputed agreement recites that
the appellant-defendant had received earnest money to the tune
of Rs.16,00,000/- for the purpose of doing agriculture and to buy
cheaper and better land nearby. Thus, a lion’s share of the sale
consideration was already paid to the appellant-defendant at the
time of the execution of the disputed agreement and the remaining
amount was hardly 15% of the total value of the suit land as agreed
upon between the parties. Therefore, it does not stand to reason
that the respondent-plaintiff being a Police Constable would part with
a huge sum of Rs.16,00,000/- towards a transaction to purchase
land and thereafter, agree to defer the execution of the sale deed
to a date almost 16 months later with the balance amount being a
fraction of the total sale consideration.
29. Apparently thus, there was no rhyme or reason as to why, the
respondent-plaintiff would agree to defer the execution of the sale
deed to a date more than a year and four months after the execution
of the disputed agreement. Thus, the disputed agreement i.e., the
agreement to sell read in entirety is highly suspicious and does not
inspire confidence at all.
30. As per the disputed agreement, the consequence of non-appearance
of the appellant-defendant at the Registrar’s office on 19th September,
2008 and his failure to get the sale deed registered, was that the
appellant-defendant would be liable to return the earnest money of
[2024] 10 S.C.R. 95
Lakha Singh v. Balwinder Singh & Anr.
Rs.16,00,000/- along with a penalty of equal amount, totalling to
Rs.32,00,000/- and even thereafter, the respondent-plaintiff would
be entitled to file a case in the civil Court for the execution of the
sale deed. Simultaneously, it was agreed that if the balance amount
was not paid by the respondent-plaintiff, the earnest money would
be liable to be forfeited by the appellant-defendant.
31. As per the averments made in the plaint, the respondent-plaintiff did
not even once, during the aforesaid period of 16 months, approach
the appellant-defendant for getting the sale deed executed in terms of
the disputed agreement. He claimed that he straight away proceeded
to the Sub-Registrar’s office on 19th September, 2008 and remained
present there from 09:00 am to 05:00 pm waiting for the appellant-
defendant to turn up and get the sale deed registered. However, the
appellant-defendant failed to appear at the office of the Sub-Registrar
on the scheduled date. Admittedly, the respondent-plaintiff did not
give any advance intimation to the appellant-defendant imploring him
to receive the balance consideration and execute the sale deed on
the scheduled date i.e. 19th September, 2008 or anytime thereafter.
Instead, he directly proceeded to file the subject suit in the month of
December, 2008 wherein, alternative prayers, one for the execution
of the sale deed and the other for the refund of the earnest money
were made.
32. Ex-facie, the averments set out in the plaint and the evidence of the
respondent-plaintiff do not bear an iota of truth and appear to be
nothing but a sheer concoction. The circumstances noted above,
the evidence of the respondent-plaintiff; the disputed agreement and
the plaint clearly indicates that the disputed agreement seems to
have been prepared on a blank stamp paper on which, the thumb
impressions of the illiterate appellant-defendant had been taken
prior to its transcription. The large blank spaces on the first and
second pages of the disputed agreement and the absence of thumb
impression/signatures of the parties and the attesting witnesses on
these two pages, fortifies the conclusion that the disputed agreement
was transcribed on one of the blank stamp papers on which the thumb
impression of the appellant-defendant had been taken beforehand.
33. It may be mentioned here that the appellant-defendant appeared
before the trial court, to give evidence as DW-1 and emphatically
denied the factum of the execution of the disputed agreement.
96 [2024] 10 S.C.R.
Digital Supreme Court Reports
He also denied having received a sum of Rs.16,00,000/- from the
respondent-plaintiff. The trial Court disbelieved the version of the
respondent-plaintiff on the aspect that the disputed agreement, for
the execution whereof the subject suit was filed, was an agreement
to sell and instead treated the amount mentioned in the disputed
agreement to be a loan. However, on-going through the cross-
examination conducted from the appellant-defendant, we do not find
any suggestion whatsoever that the amount of Rs. 16,00,000/- was
given to the appellant-defendant by way of loan.
34. On perusal of the plaint and the affidavit by way of examination-
in-chief of the respondent-plaintiff, a very significant fact can be
culled out. The respondent-plaintiff did not even make a whisper
in his deposition affidavit that when he proceeded to the office of
the Sub-Registrar on 19th September, 2008, he was carrying the
balance sale consideration with him. Furthermore, it is not the case
of the respondent-plaintiff that he ever offered the balance sale
consideration in terms of the disputed agreement to the appellant-
defendant at any point of time either before 19th September, 2008
or on 19th September, 2008, when the respondent-plaintiff appeared
before the Sub-Registrar.
35. The respondent-plaintiff admitted that he did not seek permission from
his department before entering into the agreement for purchase of
property having high value. It is not the case of the respondent-plaintiff
that he and the appellant-defendant were on such close terms that
he would readily agree to give cash loan to the appellant-defendant
without any security.
36. The factors enumerated above, are sufficient for this Court to
conclude that the entire case of the respondent-plaintiff regarding
the execution of the disputed agreement; the alleged payment of
Rs. 16,00,000/- in cash to the appellant-defendant on 7th May, 2007
and the alleged appearance of the respondent-plaintiff in the office
of the Sub-Registrar in the purported exercise of getting the sale
deed executed in terms of the disputed agreement is nothing but a
sheer piece of fraud and concoction.
37. These vital factual aspects were totally glossed over by the Courts
below while deciding the suit, the first appeal and the second appeal.
In these facts and circumstances, we find it to be a fit case to exercise
[2024] 10 S.C.R. 97
Lakha Singh v. Balwinder Singh & Anr.
our powers under Article 136 of the Constitution of India so as to
interfere with the impugned judgements.
38. Hence, there cannot be any escape from the conclusion that the
judgment and decree dated 18th February, 2013 rendered by the
trial Court, judgment dated 20th March, 2017 passed by the First
Appellate Court and the judgment dated 25th April, 2018 rendered
by the High Court suffer from perversity on the face of the record
and hence, the same cannot be sustained.
39. Resultantly, the appeal succeeds and is hereby allowed.
40. The impugned judgments are hereby quashed and set aside. Decree
be prepared accordingly. No order as to costs.
41. Pending application(s), if any, shall stand disposed of.
Result of the Case: Appeal allowed.
†
Headnotes prepared by: Ankit Gyan
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