KAREEMSAHEB NABEESAHEB NADAF Vs. BASAVANTAPPA SHANKARAPPA PATTANSHETTI

JUDGEMENT

(1.) THIS second appeal raises an interesting but equally significant and substantial question of law namely the vexed issue as to whether a court should enforce a contract if it is vitiated by the doctrine of unconscionability. The brief facts giving rise to this appeal are that the appellant before me who was the original defendant entered into a registered agreement for sale of his house on 1-8-1973, recording a consideration of Rs. 12,000/- for the property against which Rs. 6,000/- was received by him from the plaintiff. It is unnecessary for me to set out the terms of the agreement which is a very simple one and I must say to the credit of the appellant, that unlike the normal Order of the day defences wherein everything right upto the plaintiffs name and address is denied and disputed, that the defendant honestly accepted having executed the agreement and having received the amount of Rs. 6,000/ -. The agreement prescribed a period of 2 years for completion of the contract and the plaintiff served a notice on the defendant to receive the balance amount of Rs. 6,000/-, enter into the sale deed and hand over possession whereupon the defendant disputed his liability to do so. The defendant's case was that he was hard pressed for money at the relevant time because of his daughter's marriage and he contends that the transaction was nothing more than in the nature of a mortgage but that the plaintiff who is not only an affluent man but a person who also did regular money lending business bound him down to the registered agreement which he had entered into because of the need in which he was placed. Essentially, the defendant contended that he and his family members resided in the house and that he had no other place to go to and that the value of the property even on the date of the transaction was far more than what is reflected in the agreement.

(2.) IN the course of the evidence, it did emerge that the plaintiff is a very well placed person, that he owns several properties which he has even gifted to his children and that he is also a land holder and furthermore, that he also owns an oil mill. All this evidence was brought up in Order to establish before the trial court the fact that there is a yawning gap between the parties insofar as the defendant was a man of comparatively meagre economic means and furthermore, what has been established is that the value of the property was very much more than what is recorded. Apart from the plaintiff having admitted this, two defence witnesses were produced to substantiate the evidence of the defendant that the value of the house even in august 1973 was around Rs. 35,000/- whereas the agreement to sell reflected a figure of Rs. 12,000/ -. The trial court has considered the various aspects of the case and has held that a court before whom a plea for specific performance is presented is obliged by law to consider all relevant aspects and the court came to the conclusion that having regard to the disparities between the parties, if the decree came to be passed, immensely greater hardship would be caused to the defendant and his family would be rendered houseless and that was one of the main grounds on which the trial court refused a decree of specific performance to the plaintiff. However, in view of the admission that the defendant had received the amount of Rs. 6,000/- the trial court passed a decree whereby the defendant was directed to repay the amount of Rs. 6,000/- along with interest computed at 10% per annum. The plaintiff preferred an appeal against this Order and the appeal court reversed the findings of the trial court. The appeal court held that the considerations on the basis of which the decree was refused were unfounded and unacceptable and that once the defendant has accepted the execution and the fact that part consideration has been received by him, that the court had no option except to pass a decree for specific performance. Accordingly the plaintiffs suit was decreed. This second appeal is directed against the appellate decision.

(3.) I have recounted in some detail the facts and circumstances of the case because they have some bearing on the point of law that is involved in this second appeal. The appellant's learned counsel submitted that undoubtedly this court will not re-examine or re-appreciate the evidence but insofar as the record unmistakably indicated that there was a wide disparity between the fair market value of the property in question and what was recorded in the agreement, that it becomes vulnerable and that therefore the trial court was fully justified in having refused enforcement. Secondly, learned counsel submitted before me that where the law enjoins upon the trial court to examine all relevant circumstances and where the suit property consists of a dwelling house that the consequences of dispossessing the defendant of that property is something which needs to be carefully gone into and that therefore, the trial court was fully justified in having refused a decree also on the ground of comparative hardship. The third contention raised by the learned counsel was that it is now well-settled law that where the plaintiff himself puts forward an alternate plea or prayer for damages or compensation that the court should normally opt in favour of awarding monetary compensation or damages rather than enforcing the contract in a situation where the equities are in favour of the defendant. Reliance was sought to be placed on two decisions the first of them reported in parakunnam veetill Joseph's Son Mathew v Nedumbara Kuruvilla's Son and others, wherein the Supreme Court has expounded the well-settled principle of law that a court is not required to mechanically pass decrees in all suits for specific performance and that judicial discretion is required to be validly exercised because Section 20 of the specific relief ACT itself postulates that all relevant circumstances must be evaluated. The second decision is the one Reported in Tejram v Patirambhau, wherein the Supreme Court has laid down circumstances wherein it would be justified in refusing a decree for specific performance rather than granting if the interest of Justice so required. The appellant's learned counsel submitted that these decisions heavily reinforce his arguments and that therefore this court must interfere in the present proceeding.