Punjab & Haryana HC: Specific Performance Decree Restored, Collusive Decree and Fraud Plea Rejected

Case Name: Mohan Singh (through LRs) v. Gurdeep Singh (through LRs) & Ors.
Date of Judgment: January 14, 2020
Citation: RSA No. 7 of 2016 (O&M)
Bench: Hon’ble Mr. Justice Rajbir Sehrawat

Held: The High Court allowed the Regular Second Appeal and restored the trial court’s decree for specific performance of an agreement to sell agricultural land, setting aside the lower appellate court’s modification which had restricted relief to refund of earnest money. It held that the agreement dated 10.11.2004 was duly proved by attesting witnesses, the notary, and admissions of the defendants themselves, including signatures on the agreement, receipt, and notary register. The plea that signatures were obtained on blank papers for a loan was rejected as unsubstantiated. Minor drafting defects such as repetition of defendant’s name and handwritten portions were treated as typographical errors not affecting validity. The Court emphasized that inadequacy of consideration, alleged hardship, or subsequent acquisition proceedings could not frustrate the agreement once execution was proved and readiness and willingness established.

Summary: The plaintiff sued for specific performance of an agreement to sell 40 kanal 6 marla of land for Rs. 33.60 lakh, having paid Rs. 10 lakh earnest money. He marked his presence before the Sub-Registrar on the stipulated date with drafts for the balance amount. The defendants denied the agreement, alleging a loan transaction and fabrication of documents on blank papers, and pleaded hardship as the land included their residential house. During proceedings, they procured collusive decrees and mutations through family members to frustrate the suit. The trial court decreed specific performance, but the lower appellate court modified relief to refund of earnest money citing suspicious circumstances and possible hardship. On appeal, the High Court noted that both defendants had admitted signatures on the agreement, receipt, and notary register, demolishing the loan story. Sale deeds of adjoining lands at similar rates belied undervaluation claims. The alleged house was not proved by revenue records. Collusive decrees by family members confirmed the defendants’ intent to evade obligations. Preliminary land acquisition notification in 2019 did not frustrate the agreement, as the plaintiff would step into the defendants’ shoes in acquisition proceedings. The Court reiterated that fraud must be specifically pleaded and proved, which was absent here.

Decision: The High Court allowed the appeal, set aside the lower appellate court’s modification, and restored the trial court’s decree directing execution of sale deed in favour of the plaintiff, with costs.