A.S. Naidu, J.
1. This Letters Patent Appeal under Chapter- VII, Rule 2(a) of the Orissa High Court Rules is at the instance of the defendants challenging the judgment and decree dated August 7, 1995 passed by the Hon'ble Single Judge of this Court in First Appeal No. 27 of 1988, confirming the judgment and decree dated December 19, 1987 passed by the then Subordinate Judge, Chhatrapur in Title Suit No. 25 of 1984.
2. The suit out of which this Letters Patent Appeal arises was one for Specific Performance of Contract, filed by the present respondent No. 1 as the sole plaintiff. Bereft of all the unnecessary details, the short facts of the case as would be apparent from the averments made in the plaint are as follows :
On November 7, 1983, A. Gopal Rao (Defendant No. 1) executed an unregistered plain paper agreement (Ext.l) in respect of the suit scheduled house site agreeing to alienate the same in favour of plaintiff for a consideration of Rs. 25,000/-. Out of the said amount a sum of Rs. 5,000/- was paid on the same day as token of part performance. Although it was stipulated in the said agreement that within six months of receipt of the balance consideration amount, defendant No. 1 would execute a registered sale deed in favour of the plaintiff, he, violating the terms of the agreement, entered into another registered agreement for the same site with Ranka Panda (Defendant No. 2) and Padma Charan alias Padmanava Patra (Defendant No. 3) on March 14, 1984 (Ext.l) fixing the consideration amount at Rs. 38,000/- and received Rs. 2005/- as advance. After coming to know about the said fact, the plaintiff issued notice to all the defendants on March 29, 1984 (Ext-7 to 9) intimating about the subsistence of earlier agreement between him and Defendant No. 1 and forbidding them to enter into any sale transaction. It is alleged that the notices issued to Defendant No. 1 (Ext-7) returned unserved, whereas notice issued to Defendant No. 2 (Ext-8) and notice issued to Defendant No. 3 (Ext-9) returned unserved on their refusal. On April 2, 1984, the plaintiff having come to know that defendants were conspiring amongst themselves to execute the sale deed in respect of the suit site, instituted a suit praying for specific performance of contract and for other ancillary reliefs in the Court of the then Subordinate Judge, Chhatrapur which was registered as T.S. No. 25 of 1984.
3. After receiving notice of the suit, defendant No. 1 appeared and filed a written statement. Defendants 2 and 3 also filed separate but joint written statement. In his written statement, defendant No. 1 denied execution of agreement (Ext-1) as well as receipt of Rs. 5,000/- thereunder towards part performance of the sale consideration. His specific case was that taking advantage of his absence from Chhatrapur two persons, namely, Bauria Behera and Purna Chandra Moharana trespassed and remained in illegal occupation of the suit house site. In order to initiate a proceeding to evict them, he had given, two sheets of signed blank papers to his childhood friend and class-mate Ramanuja Das. It is asserted that the said papers were utilised subsequently for the purpose of scribing the agreement. It was further pleaded by defendant No. 1 that prior to the execution of the agreement (Ext-A), the trespassers were evicted by a compromised judgment passed in T.S. No. 66 of 1984, and thereafter he sold the property to defendants 2 and 3,
4. Defendants 2 and 3 in their joint written statement stated that after purchasing the suit property they are in peaceful and uninterrupted possession of the suit house site. It is also asserted that they had never received any notice with regard to the earlier agreement (Ext-1) and were bona fide purchasers. The Defendants prayed for dismissal of the suit.
On the basis of the pleading, the trial Court framed as many as seven issues.
To prove the case, the plaintiff examined two witnesses and exhibited 9 documents. Similarly, the defendants in support of their pleadings, examined two witnesses and exhibited six documents.
5. The trial Court after going through the pleadings and after vivid discussion of the evidence, both, oral and documentary, arrived at the following findings :
(A) Ext-1 was executed by defendant No. 1, and the plaintiff is entitled to specific performance of contract.
(B) Ext-A is not beyond suspicion.
(C) Defendant Nos. 2 and 3 are not bona fide purchasers for value without notice.
(D) The plaintiff has averred in the plaint his readiness and willingness to perform his part of the contract but the same was not mentioned in the; copies of the plaint served on the defendants due to inadvertent mistake.
On the basis of the aforesaid findings, the learned Subordinate Judge decreed the suit and granted other consequential reliefs.
6. Being aggrieved by the judgment and decree passed by the learned Subordinate Judge, the defendants filed First Appeal No. 27 of 1988 before this Court. During the pendency of the First Appeal, A. Gopal Rao (Defendant No. 1) died and his legal heir and successor, was substituted as appellant No. A/1.
The Hon'ble Single Judge after going through the pleadings and evidence on record, both, oral and documentary, came to the following findings :
(1) The learned Subordinate Judge is perfectly justified in disbelieving the blank paper theory advanced by Defendant No. 1 and in believing the valid execution of the agreement (Ext-1).
(2) The finding of the learned Subordinate Judge that Defendants 2 and 3 by the time of execution of the sale deeds (Exts. B, C and D) on 5.4.1984 had knowledge of the prior agreement for sale dated November 7, 1983 (Ext-1), is not liable to be disturbed. In that view of the matter, defendants 2 and 3 cannot take advantage of Section 19(b) of the Specific Relief Act, 1963 to say that they had paid the consideration amount in good faith and without notice of the original contract.
(3) In a suit for specific performance of contract if on a consideration of the entire averments in the plaint it can be reasonably held that the plaintiff has been ready and willing to perform his part of the contract from the date of the agreement till the date of its presentation, then there is sufficient compliance of Section 16(a) of the Specific Relief Act so far as pleading is concerned.
(4) Although there was stipulation in the agreement dated November 7, 1983 (Ext-1) that the registered sale deed is required to be executed within six months, the suit was instituted earlier to that date i.e. on April 5th, 1984. Thus, there was still time for the plaintiff to send the draft sale deed for approval to Defendant No. 1 and to say that he was ready and willing to bear the cost of the registration and stamp duty.
(5) The contention that in view of Sub-section (2) of Section 22 of the Specific Relief Act. 1963, the plaintiff was obliged in the suit for specific performance of contract to pray for possession and such a prayer having not been made, the suit was liable to be dismissed; was not accepted by the Hon'ble Single Judge on the basis of the ratio of the decisions of the Hon'ble Supreme Court in the case reported in AIR 1982 SC 818, dismissed the appeal.
As stated above, the confirming judgment and decree passed by the Hon'ble Single Judge is impugned in this Letters Patent Appeal.
7. Mr. Mukherjee, learned Senior Advocate for the appellants in this A.H.O. while reiterating the stand taken by the Appellant, urged the following points to be considered in this appeal.
It is submitted that the plea taken by the defendants regarding utilisation of the signed blank papers for scribing the agreement (blank paper theory) should have been accepted by both the Courts. In the alternative, Mr. Mukherjee submitted that even if this theory is not accepted, the onus is very heavy on the plaintiff to prove execution of Ext-1 by defendant No. 1. It is submitted that execution of Ext-1 having not been proved, the same should not have been accepted by both the Courts. According to Mr. Mukherjee, the following reasons clearly reveal that execution of Ext-1 was not duly proved.
(i) Kashab Das, the so called scribe of Ext-1 dated November 7, 1983 has not been examined. Similarly, out of two attesting witnesses, only Srinibas Sahoo has been examined as P.W.2, and Simachal Panda was not examined. P.W.2's evidence so far as it relates to execution of Ext-1 is concerned, is not satisfactory. P.W.2 being an interested witness, his evidence should not have been accepted.
(ii) Ext-1 is scribed only on plain paper and its genuineness has been questioned in the written statement. The said document on the basis of which the suit was filed, was not produced in Court along with the plaint in contravention of the provision of Order 7, Rule 14, C.P.C. and the same should have been discarded on the said ground alone. Reading of Ext-1 would also reveal that a sum of Rs. 5,000/- alleged to have been received as advance towards part performance of the agreement. Surprisingly, however, no revenue stamp has been affixed which throws clouds of suspicion regarding genuineness.
(iii) A bare lok at Ext-1 reveals that there are irregular spacing between two lines which creates doubt.
Mr. Mukherjee further contended that both the Courts over looked the point that the plaintiff has failed to establish the fact that defendants 2 and 3 had knowledge regarding existence of the agreement Ext-1 prior to execution of Ext-A on March 14, 1984 and on that ground alone, the suit should have been dismissed. Defendants 2 and 3 are bona fide purchasers for value without knowledge of Ext-1. It is further urged that specific performance of Ext-1 cannot be enforced in favour of plaintiff, who failed to prove that he has performed or was always ready and willing to perform essential terms of the contract.
Mr. Mohapatra, learned Senior counsel for the plaintiffs- respondent, on the other hand submitted, that the trial Court rightly disbelieved the theory of using two blank papers for creation of Ext-1. Mr. Mohapatra drew our attention to the original Ext-1 and submitted that perusal of the spacing of the letters does not convince that there is any interpolation and/or irregular spacing or that the same was subsequently created. It is further submitted that the plaintiff has examined one of the attesting witnesses as P.W.2. Mr. Mohapatra also criticised the plea taken by the defendants that he had handed over two blank papers to his friend Ramanuja Das on the ground that evidence adduced in Court is contrary to the said pleadings. In view of the discrepancy between the evidence and pleadings regarding the blank paper theory, according to Mr. Mohapatra, the Courts have rightly discarded it. It is further submitted that non-examination of the scribe is also not very much fatal in this case because execution of the document is proved by consistent evidence of P.W.I, corroborated by P.W.2. Both the witnesses have sustained elaborate cross-examination.
Mr. Mohapatra further argued that the document (Ext-1) was duly filed in Court after obtaining prior permission as required under Order 7, Rule 18(2) of the C.P.C. Thus, there is absolutely no contravention of the provisions of Order 7, Rule 14, C.P.C. Drawing our attention to Exts. 7 to 9, the notices issued and Exts. 4 and 5, the objections filed before the Sub-Registrar, and the orders passed before registration of the sale deeds, it was vehemently argued by Mr. Mohapatra that the facts and circumstances and the evidence available on record clearly reveal that defendants 2 and 3 had prior notice of the unregistered agreement dated November 7, 1983 (Ext-1) executed in favour of the plaintiff and they cannot be nomenclatured as bona fide purchasers. Mr. Mohapatra, further argued that the plaintiff was all along ready and willing to perform his part of the contract. It is submitted that in a suit for specific performance of contract, the plaintiff has to allege about his readiness and if the fact is disputed then only he is required to prove the continuous readiness and willingness from the date of contract till the time of hearing of the suit to perform his part of the contract. In support of his contention, Mr. Mohapatra relied upon the decisions in the case of Ardeshir H. Mama v. Flora Sassoon, 1928 P.C. 208, Ramesh Chandra Chadiok and Anr. v. Chuni Lal Sabharwal and others, AIR 1971 SC 1238 and Durjyodhan Palei and Ors. v. Padana Charan Das and others, AIR 1978 Orissa 5.
Mr. Mohapatra further urged that the agreement for sale like Ext-1 does not require any registration and that the suit for specific performance of contract can be filed on the basis of an unregistered agreement for sale.
9. We have heard learned counsel for the parties. It appears from the evidence of P.W. 1 that in consonance with the instructions issued by Defendant No. 1, the agreement (Ext-1) was scribed by one Keshab Das. One of the conditions in the agreement was that Defendant will execute the sale deed within six months from the date of the agreement and/or in default he will pay interest on the advance paid and execute the sale deed thereafter. It is further categorically averred and deposed in Court that defendant was in a hurry to go back to Waltire and it was not possible to purchase stamp papers as the same were not available. P.W. 1 was exhaustively cross-examined by the defendants, but nothing could be elicited to disbelieve his testimony. Similarly P.W. 2 has also proved execution of the agreement (Ext-1). It is solemnly deposed in Court that the same was executed in his presence.
10. Analysing the evidence of P.Ws. 1 and 2, the trial Court as well as the Hon'ble Single Judge have arrived at a conclusion that the theory of blank paper signature advanced by defendant No. 1 is not believable and that the agreement (Ext-1) was validly executed. We do not find any reason to interfere with the said finding which is based on cogent evidence. The said finding is, thus, confirmed.
11. Mr. Mukherjee, learned Senior Advocate for the appellants vehemently urged that the agreement dated November 7, 1983 having not been filed along with the plaint, the trial Court acted illegally in accepting the same. It was further argued that, in course of evidence, the trial Court committed further error in accepting the said document as Ext-1, in spite of objection on the ground of non-payment of stamp duty. It is submitted that if the acceptance of the document in evidence is not in consonance with law and the same is ignored, then the entire suit would fail inasmuch as there would be no agreement which can be specifically enforced. It is also urged that in the alternative that Ext-1 being an instrument, as defined Under Section 2(14) of the Indian Stamp Act and the stamp duty, as required Under Section 35 of the Act having not been paid, it should not have been accepted in evidence.
On the other hand, Mr. Mohapatra, learned counsel for the respondents urged that this point having not been pleaded nor raised in the suit, cannot be permitted to be agitated in the Letters Patent Appeal. According to us this being a pure question of law, can be agitated at any stage of the suit.
12. On scrutiny of the lower Court records, it is found that a petition was filed before the trial Court with a prayer for accepting certain documents filed by the plaintiff, out of which one document was the agreement. Another petition was also filed praying for condonation of the delay in filing the documents and to accept the same. The trial Court after hearing counsel for both the parties, by its Order No. 122 dated September 16, 1987 allowed the petition and the documents were accepted subject to proof of relevancy and admissibility. The said order has become final and binding. Thus, the argument advanced by Mr. Mukherjee regarding acceptance of the document by the trial Court at this belated stage, cannot be accepted. In the present case the provisions of Order 7, Rule 18(2) C.P.C. have been duly complied with and the documents have been filed and accepted with the leave of the Court.
To appreciate the contention of Mr. Mukherjee, that the agreement (Ext-1) being an unregistered one, and no stamp duty having been paid, the same should not have been accepted in evidence it is required to refer to Section 2(14) of the Indian Stamp Act which defines 'instrument' as follows :
'Instrument : 'Instrument' includes every document by which any right or liability is, or purports to be, created, transferred, limited, extended, extinguished or recorded.'
Mr. Mukherjee referred to Section 35 of the Stamp Act and stated that no instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent of parties authority to receive evidence, unless such instrument is duly stamped.
The document Ext-1 is an unregistered agreement for sale. On the basis of the said document, no right or liability is created and/or transferred, limited, extended, extinguished or recorded. Thus, Ext-1 in our conscious opinion does not satisfy the definition of 'instrument' which required to be stamped.
Section 17 of the Registration Act enumerates the category of documents which require registration. Section 17(1)(b) of the Act provides for registration of non-testamentary instruments which purports or operate to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immoveable property. Section 17(2)(v) of the Act stipulates that nothing in Clauses (b) and (c) of Sub- section (1) of Section 17 applies to any document not itself creating, declaring, assigning, limiting or extinguishing any right, title or interest of the value of one hundred rupees and upwards to or in immoveable property, but merely creating a right to obtain another document which will, when executed, create, declare, assign, limit or extinguish any such right, title or interest. An agreement for sale of immoveable property is a non-testamentary instrument which does not create, declare, assign, limit or extinguish, any right, title or interest, whether vested or contingent in immoveable property. Section 17(2)(v) makes the position clear that a document not itself creating a right in immoveable property of the value of Rs. 100/- and upwards, but merely creating a right to obtain another document which will, when executed, create any such right need not be registered. It has been held in the case of Narasimhaswamy v. Venkatalingam. AIR 1927 Mad. 636 (FB) that a document which does not by itself convey property but merely gives a right to call for another document does not require registration. Explanation to Section 17(2) of the Act makes it clear that even an unregistered document affecting immoveable property may be received as an evidence of contract in a suit for specific performance. This explanation was added by Section 2 of the Indian Registration (Amendment) Act, 1927. The explanation states that a document purporting or operating to effect a contract for the sale of immoveable property shall not be deemed to require or ever to have required registration by reason only of the fact that such a document contains a recital of the payment of any earnest money or of the whole or of any part of the purchase money.
Therefore, the conclusion is irresistible that the suit for specific performance can be based on an unregistered agreement. Thus, a cumulative reading of Section 17(2)(v) and the proviso to Section 49 of the Registration Act leads to an irresistible conclusion that an agreement for sale of immoveable property even though not registered, can form the basis for specific performance. The Hon'ble Single Judge was, thus, right in holding that Ext-1 can be enforced. The decision of this Court reported in AIR 1964 Orissa 237 also supports the above view.
We are, therefore, not agreeable to accede to the submissions advanced by Mr. Mukherjee and negative the argument that the agreement (Ext-1) being unregistered and unstamped, cannot be accepted nor can be enforced.
We also find that all other points raised by Mr. Mukherjee have been answered by the trial Court as well as Hon'ble Single Judge in First Appeal. After examining the evidence and considering the submissions, we agree with the findings arrived at by the Court below and the Hon'ble Single Judge, that Ext-1 was a valid document and was duly executed by the defendant No. 1 and that a decree to specifically perform the terms of the agreement (Ext-1) can be passed. We also confirm the finding that the time stipulated in the agreement not having expired, there was no occasion for the appellants to initiate any proceeding and the pleading regarding appellant's ready and willingness is adequate, as the same has not been specifically traversed in the written statement.
In view of the aforesaid findings, we are not inclined to interfere with the judgment and decree passed by the Hon'ble Single Judge in First Appeal and we hold that there is no merit in this Letters Patent Appeal and accordingly, dismiss the same and confirm the judgment and decree passed by the trial Court. We further direct that the parties should bear their respective costs.
P. Ray, J.
12. I agree.