Law Web: Whether the court can rely on agreement of sale if police constable fails to obtain permission from the department before entering into the transaction?

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. {Para 28}

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO(S). OF 2024

(Arising out of SLP(Civil) No(s). 30250 of 2018)

LAKHA SINGH Vs BALWINDER SINGH & ANR.

Coram: Mehta, J.

Citation: 2024 INSC 744.

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,

1 RSA No. 4577 of 2017(O&M).

Tarn Taran2 in Civil Appeal3 was affirmed. The First Appellate

Court dismissed the Civil Appeal preferred by the appellantdefendant 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 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

2 ‘First Appellate Court’.

3 Civil Appeal No. 05 of 2016.

4 ‘trial Court’.

5 Civil Suit No. 535 of 2008.

6 ‘disputed agreement’.

7 ‘suit land’.

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).

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 appellantdefendant to arrive. However, the appellant-defendant did not turn

up to get the sale deed registered in favour of the respondentplaintiff, 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, 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

8 Civil Suit No. 535 of 2008

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.

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 respondentplaintiff’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 respondentplaintiff 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.

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/cosharer 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 respondentplaintiff. 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 as PW-1 produced on record the agreement to

sell9, duly signed by the appellant-defendant.

‘disputed agreement’

b. The respondent-plaintiff testified that the appellantdefendant 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.

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 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 respondentplaintiff, 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 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 appellantdefendant 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 respondentplaintiff, 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.

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 wellestablished. In the case of Sukhbiri Devi v. Union of India10, 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. On

appreciation of evidence another view is possible also cannot

be a reason for substitution of a plausible view taken and

10 2022 SCC OnLine SC 1322.

11 (2019) 8 SCC 637.

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 twoJudge Bench of this Court held that this Court does not

interfere with the concurrent findings of fact unless it is

established:

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.

12 (2022) 8 SCC 253.

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 appellantdefendant 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 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