1929 (2) TMI 3 - HC - Indian Laws

Summary

Issues:
- Suit for specific performance of a contract
- Defendants' defense of a previous agreement
- Burden of proof on defendants regarding knowledge of the contract
- Defendants' failure to prove payment of consideration money
- Defendants' duty to inquire about plaintiff's possession
- Appeal dismissal and costs
- Direction for depositing balance in court

Analysis:

The case involves an appeal arising from a suit for specific performance of a contract. The plaintiff claimed that the disputed land was promised to be sold to them by the defendant No. 1, who later sold it to defendants Nos. 2 and 3. The defendants argued that they had a prior agreement with defendant No. 1 and were unaware of the plaintiff's contract. Both lower courts found in favor of the plaintiff, concluding that the defendants were aware of the prior contract and did not make a bona fide purchase. The Subordinate Judge also doubted the payment of consideration by defendants Nos. 2 and 3 to defendant No. 1.

The defendants contended that the burden of proof regarding knowledge of the contract was misplaced on them. However, the court referred to Section 27 of the Specific Relief Act, stating that the onus is on the party claiming the exception to prove it. Citing relevant case law, the court upheld the lower court's decision to place the burden on the defendants to prove they were transferees for value without notice of the original contract. The court noted the lack of evidence from the defendants to shift the burden.

Another critical finding was that defendants Nos. 2 and 3 failed to prove payment of consideration money and were not bona fide purchasers for value, essential under Section 27 of the Act. Additionally, the court considered the defendants' duty to inquire about the plaintiff's possession, emphasizing the need for due diligence before claiming bona fide purchase status. The court highlighted the defendants' awareness of the plaintiff's possession but lack of knowledge about the specific land in dispute, indicating a failure to conduct necessary inquiries.

Ultimately, the appeal was dismissed, and costs were awarded to the plaintiff. The court directed that if the plaintiff deposits the balance amount in court, it should be paid to defendants Nos. 2 and 3, as admitted purchasers by defendant No. 1. The judgment was agreed upon by both judges, emphasizing the lack of denial under oath regarding notice, further supporting the dismissal of the appeal.