Harish Kumar v. Amar Nath (Dead) Through LR
Background
The respondents sued for specific performance of an agreement under which the appellant had allegedly agreed to sell his house for Rs. 70,000, having already received Rs. 55,000 and continued living there as a tenant. The appellant claimed he had instead only borrowed Rs. 50,000 from the respondent (a practising advocate and, he alleged, a moneylender) and had signed blank stamp papers as security for that loan, which were later misused to fabricate the sale agreement: a loan he said he had since repaid. The Trial Court and the first Appellate Court both believed the appellant and dismissed the suit; the High Court, in a second appeal, reversed those findings and ordered specific performance.
Decision Breakdown
The Supreme Court allowed the appellant's further appeal and set aside the High Court's judgment. It held that the respondents, who bore the onus of proving a valid agreement existed, had relied only on self-serving testimony and had never called the two attesting witnesses to the agreement (who had, in fact, given affidavits supporting the appellant's blank-paper story): a critical gap the High Court had wrongly overlooked. The Court found the High Court had erred in disturbing concurrent factual findings of two lower courts in a second appeal. However, since the appellant also failed to prove he had actually repaid the Rs. 50,000 loan, the Court did not simply dismiss the suit outright, instead, it ordered the appellant to pay the respondents Rs. 3,00,000 in full and final settlement, in place of specific performance.
Lesson Learnt
A person seeking specific performance of a sale agreement must affirmatively prove the agreement was genuinely executed: merely producing one's own testimony, without calling the witnesses to the document, is not enough, especially where the other side raises a credible fraud defence. Courts also have the power to award money in place of forcing a disputed sale through.