Telangana High Court
M/S. Yeshaswi Infrastructures Limited vs Sri. Gobindram Babani on 24 July, 2026
IN THE HIGH COURT FOR THE STATE OF TELANGANA
AT HYDERABAD
THE HON'BLE SRI JUSTICE G.M.MOHIUDDIN
CITY CIVIL COURT APPEAL Nos. 33 and 34 OF 2016
DATE: 24.07.2026
CCCA No.33 of 2016
Between:
M/s. Yeshaswi Infrastructures Limited
and another
....Appellants
And
Sri Gobindram Babani
....Respondent
CCCA No.34 of 2016
Between:
M/s. Yeshaswi Infrastructures Limited
and another
....Appellants
And
Sri Gobindram Babani and another
....Respondents
COMMON JUDGMENT
Heard Sri Srinivas Polavarapu, learned counsel for the
appellants in C.C.C.A.Nos.33 and 34 of 2016; Sri R.Vinod Reddy,
learned counsel for the sole respondent in C.C.C.A.No.33 of 2016
and respondent No.1 in C.C.C.A.No.34 of 2016; and Sri
M.Ravindranath Reddy, learned counsel for respondent No.2 in
C.C.C.A. No.34 of 2016 and perused the record.
2
2. Since these two appeals arise out of the common judgment
and decree dated 21.08.2015 passed by the learned I Additional
Chief Judge, City Civil Court, Secunderabad in O.S.No.34 of 2005
and O.S.No.119 of 2006, they are being disposed of by this
common judgment.
3. In CCCA No.33 of 2016, the appellants are the plaintiffs and
the respondent is the defendant in O.S.No.34 of 2005.
4. In CCCA No.34 of 2016, the appellants are the defendants;
respondent No.1 is the plaintiff and respondent No.3 is defendant
No.3 in O.S.No.119 of 2006.
Factual Matrix
5. The appellant No.2 is the owner of the land admeasuring
8093.33 Sq Yds situated at Municipal Nos. 1-2-166 to 193 (Old
No.91), S.D. Road, Secunderabad. Pursuant to a development
arrangement entered into between the appellants, the appellant
No.1 undertook the development of the property and constructed a
commercial complex known as “Bhuvana Towers.”
6. During the course of the development, the respondent
approached the appellants expressing his intention to purchase a
portion of the commercial complex, namely Shop Nos. UG-14 and
UG-15 situated on the Upper Ground Floor, admeasuring 660 sq.
ft. and 590 sq. ft. respectively (including common areas), together
3
with an undivided share of land admeasuring 10 Sq Yds, for a total
sale consideration of Rs.15,00,000/-.
7. Pursuant thereto, the appellants executed a registered Sale
Deed, bearing Document No.1696 of 2002 dated 24.12.2002, in
favour of the respondent in respect of the aforesaid property. The
registered sale deed, inter alia, contained recitals to the effect that:
i) the vendors had received the entire sale consideration of
Rs.15,00,000/-; and
ii) vacant physical possession of the suit schedule property had
been delivered to the purchaser on the date of execution of
the sale deed.
8. The respondent retained custody of the original registered
sale deed. Consequently, the appellants relied upon and produced
certified copies of the said sale deed before the Trial Court.
9. The case of the appellants is that the respondent, who was
known to them for a considerable period, approached them
expressing his intention to purchase the suit schedule property
and represented that he would pay the sale consideration of
Rs.15,00,000/- within three months from the date of execution of
the registered sale deed. Believing the said representation and
acting in good faith, the appellants executed and registered the sale
deed in favour of the respondent. According to the appellants:
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i) Though the registered sale deed contains a recital
acknowledging receipt of the entire sale consideration, no
amount whatsoever was in fact received from the respondent.
ii) Notwithstanding the recital contained in the sale deed,
vacant physical possession of the suit schedule property was
never delivered to the respondent.
iii) As on the date of execution of the sale deed, the suit
schedule property was in an unfinished stage, which,
according to the appellants, itself demonstrates that the
recital regarding delivery of possession is factually incorrect.
iv) The registered sale deed does not disclose the mode of
payment, namely whether the consideration was paid by
cash, cheque or demand draft, nor does it specify the date of
payment. According to the appellants, the absence of such
particulars clearly establishes that no sale consideration
had, in fact, passed from the respondent.
v) That despite repeated demands calling upon the respondent
to honour his promise by paying the sale consideration and
taking possession of the property, the respondent expressed
his financial inability, sought extension of time on more than
one occasion, and even offered to pay interest at the rate of
24% per annum on the outstanding amount.
vi) Ultimately, the respondent failed to fulfil his promise and
fraudulently procured the execution of the registered sale
5deed without paying the agreed sale consideration, with no
intention of performing his obligations under the contract,
thereby rendering the sale deed liable to be cancelled.
10. The respondent disputes the aforesaid allegations and set up
a case entirely contrary to that of the appellants. According to the
respondent:
i) The respondent paid the entire sale consideration of
Rs.15,00,000/- in cash, as demanded by the appellants.
ii) Upon receipt of the entire sale consideration, the appellants
voluntarily executed and registered the sale deed in his
favour.
iii) Simultaneously with the execution of the sale deed, the
appellants delivered vacant and peaceful possession of the
suit schedule property to him.
iv) Since the date of purchase, he has been in lawful, peaceful
and absolute possession and enjoyment of the suit schedule
property as its owner.
v) The recitals contained in the registered sale deed
acknowledging receipt of consideration and delivery of
possession carry a statutory presumption of correctness and
are binding upon the appellants.
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vi) Having consciously executed the registered sale deed, the
appellants are estopped from pleading contrary to its express
recitals.
vii) The appellants, who are experienced and knowledgeable
businessmen, executed the registered sale deed voluntarily
and instituted the present suit more than two and a half
years thereafter, not on account of any genuine grievance,
but with the sole intention of coercing the respondent into
re-conveying the property so as to enable them to sell the
same at a higher value.
11. Aggrieved by the alleged non-payment of the sale
consideration and disputing the recitals contained in the registered
sale deed, the appellants instituted O.S. No.34 of 2005 on
20.04.2005 before the Court of the I Additional Chief Judge, City
Civil Court, Secunderabad, seeking the following reliefs:
i) cancellation of the registered Sale Deed dated 24.12.2002
executed in favour of the respondent; or, in the alternative,
ii) recovery of a sum of Rs.23,40,000/-, comprising the sale
consideration of Rs.15,00,000/- together with accrued
interest/damages calculated at the agreed rate of 24% per
annum from 24.12.2002 to 18.04.2005.
12. During the pendency of the aforesaid suit, the respondent
instituted O.S.No.119 of 2006 on 25.08.2006 before the same
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Court, asserting his rights under the registered sale deed and
seeking the following reliefs:
i) a declaration that he is the absolute owner of the suit
schedule property;
ii) delivery of vacant possession of the suit schedule property;
and
iii) recovery of mesne profits and consequential reliefs.
13. In the said suit, M/s. Secunderabad Hotels Private Limited
was impleaded as the defendant No.3, it being the tenant inducted
by the appellants and in occupation of the suit schedule property
under a registered lease deed.
14. Since both suits arose out of the same transaction, involved
the same suit schedule property and raised common questions of
fact and law, the trial Court, by order dated 07.10.2014, directed
that O.S. No.34 of 2005 and O.S. No.119 of 2006 be tried together
and disposed the two suits by a common judgment.
Consideration by the trial Court
15. Before the trial Court, in O.S.No.34 of 2005, the appellant
No.1/plaintiff No.1 examined himself as PW-1 and marked Exs.A1
to A11. On the other hand, the respondent examined himself as
DW-1 and marked Exs.B1 to B5. In O.S.No.119 of 2006, the
respondent/plaintiff examined himself and marked Exs.A1 to A5.
None examined and no exhibits marked for the defendants.
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16. The trial Court, by common order dated 07.10.2014, upon
appreciation of the oral and documentary evidence, recorded the
following findings:
Findings in O.S. No.34 of 2005
The trial Court dismissed the suit instituted by the
appellants and held that they had failed to establish that the
registered Sale Deed dated 24.12.2002 (Ex.A1/Ex.B1) was
unsupported by consideration or that they were entitled to its
cancellation.
The trial Court observed that the registered sale deed
contains an unequivocal recital acknowledging receipt of the entire
sale consideration of Rs.15,00,000/- and delivery of vacant
possession of the suit schedule property. Holding that a registered
document carries a presumption as to the correctness of its
recitals, the trial Court placed the burden upon the appellants to
rebut the same by cogent and convincing evidence and found that
they had failed to discharge such burden.
The trial Court attached considerable significance to the fact
that the sale deed had been executed on behalf of the appellants by
their authorised signatory, Sri B. Chandramouli, who was not
examined during trial. Instead, the appellants examined PW.1 (Sri
B. Srinivas), who admittedly became associated with the company
9subsequently and had no personal knowledge of the transaction.
His testimony was found to be based only upon the company
records and not upon his own knowledge of the execution of the
sale deed.
The trial Court further observed that the appellants, being
incorporated companies, would ordinarily have maintained
contemporaneous corporate records if the sale deed had in fact
been executed without receipt of consideration. However, no board
resolution, internal correspondence or other contemporaneous
material was produced to substantiate the appellants’ plea. This
omission, according to the Trial Court, substantially weakened
their case.
With regard to the appellants’ plea that the respondent had
agreed to pay the sale consideration within three months from the
date of execution of the sale deed and had subsequently agreed to
pay interest at the rate of 24% per annum, the trial Court held that
such an important understanding was neither incorporated in the
registered sale deed nor reduced into writing. No legal notice
demanding payment was issued prior to the institution of the suit,
nor were any particulars regarding the dates, places or persons
present during the alleged discussions pleaded or proved.
The trial Court also noticed that during cross-examination
PW.1 admitted that Ex.A1 had been prepared by the appellants
10themselves and that the registered sale deed expressly
acknowledged receipt of the entire sale consideration. The omission
in the document regarding the mode of payment, namely whether
by cash, cheque or demand draft, was held to be inconsequential,
since the sale deed had been prepared and executed by the
vendors themselves and such omission could not be used to
discredit the recital acknowledging receipt of consideration.
The evidence of the respondent, examined as DW.1, was
accepted insofar as he consistently deposed that he had paid the
entire sale consideration in cash and that possession of the
property had been delivered to him. Although DW.1 admitted that
the property had not been mutated in his name and that he had
not paid municipal taxes, the trial Court held that such
circumstances were insufficient to displace the presumption
arising from the registered sale deed.
The trial Court further held that the appellants had failed to
establish the allegation of fraud. No particulars of the alleged
fraudulent representations, the circumstances in which they were
made, or the persons before whom such representations were
allegedly made were either pleaded or proved. The Court further
observed that, even assuming that the sale consideration had
remained unpaid, the remedy available to the vendors would
ordinarily be recovery of the unpaid consideration and not
11cancellation of a completed sale, particularly when the alleged
agreement regarding deferred payment had not been incorporated
in the registered sale deed.
While considering the additional issue relating to possession, the
trial Court held that the unfinished condition of the premises did
not necessarily preclude delivery of possession. It further held that
the appellants had failed to establish why the alleged
understanding regarding deferred payment of consideration and
deferred delivery of possession was omitted from the registered sale
deed. The explanation offered by the respondent that he intended
to commence business after completion of the remaining works in
the building was accepted as more probable. The trial Court
ultimately concluded that possession had initially been delivered to
the respondent in terms of the registered sale deed and that the
appellants, taking advantage of their continued control over the
commercial complex, subsequently re-entered the suit schedule
property and inducted the third defendant as their tenant under a
registered lease deed.
In view of the aforesaid findings, the trial Court held that the
appellants had failed to establish that the sale deed was
unsupported by consideration that they were entitled to
cancellation of the sale deed or that they were entitled to the
alternative relief for recovery of the alleged unpaid sale
12consideration. Thus, O.S.No.34 of 2005 came to be dismissed with
costs.
Findings in O.S. No.119 of 2006
Consequent upon the findings recorded in O.S. No.34 of
2005, the trial Court proceeded to consider the suit instituted by
the respondent seeking declaration of title, recovery of possession
and mesne profits.
The trial Court held that the respondent had acquired valid
title to the suit schedule property under the registered Sale Deed
dated 24.12.2002 (Ex.A1/Ex.B1). Since the appellants failed to
establish any legal ground warranting cancellation of the sale deed,
the respondent was held entitled to a declaration that he is the
absolute owner of the suit schedule property.
The trial Court further held that, although the appellants
and their tenant were found to be in possession of the suit
schedule property as on 04.08.2006, such possession was not on
account of the respondent having never been put in possession. On
the contrary, the trial Court concluded that possession had initially
been delivered to the respondent pursuant to the registered sale
deed and that the appellants had subsequently regained
possession by inducting the third defendant as their tenant.
Consequently, the appellants and the third defendant were held
13liable to vacate the suit schedule property and deliver vacant
possession thereof to the respondent.
The trial Court also held that the respondent was entitled to
mesne profits from 04.08.2006, being the date on which he came
to know of the alleged unauthorised occupation of the suit
schedule property, until delivery of vacant possession. The
determination of the quantum of mesne profits was directed to be
undertaken in separate proceedings under Order XX Rule 12 of the
Code of Civil Procedure, 1908 (CPC), and costs were awarded in
favour of the respondent.
Accordingly, the trial Court, by its common judgment and
decree dated 21.08.2015, dismissed O.S. No.34 of 2005 with costs
and decreed O.S.No.119 of 2006, declaring the respondent as the
absolute owner of the suit schedule property, directing the
appellants to deliver vacant possession within two months,
awarding mesne profits from 04.08.2006 until delivery of
possession, subject to determination in separate proceedings, and
granting costs.
Submissions on behalf of the Appellants
17. The learned counsel appearing for the appellants assailing
the common judgment advanced the following submissions:
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i) That the findings recorded therein are contrary to the
pleadings, evidence on record and the settled principles
governing transfer of immovable property. According to the
learned counsel, the trial Court failed to appreciate that the
registered Sale Deed dated 24.12.2002 was executed without
receipt of the agreed sale consideration and, consequently,
the respondent acquired no valid title over the suit schedule
property.
ii) That the respondent had approached the appellants and
represented that the sale consideration of Rs.15,00,000/-
would be paid within three months from the date of
execution of the registered sale deed. Acting upon such
representation, the appellants executed the sale deed,
wherein a recital acknowledging receipt of the sale
consideration was incorporated at the instance of the
respondent only to facilitate his tax requirements. It was
contended that the said recital does not reflect the true
transaction between the parties and, being only prima facie
evidence, is open to rebuttal by cogent oral and documentary
evidence. Despite repeated demands, the respondent failed to
honour his promise and did not pay the agreed sale
consideration.
iii) That the registered sale deed is conspicuously silent as to the
mode of payment, namely whether the consideration was
15
paid by cash, cheque or demand draft, as also the date on
which such payment was allegedly made. Had the
respondent actually paid a substantial sum of
Rs.15,00,000/-, the document would ordinarily have
contained the relevant particulars. According to the learned
counsel, the omission to mention such material particulars
itself probabilises the appellants’ case that no consideration
had in fact passed.
iv) That the burden of proving payment of consideration
squarely rested upon the respondent, since the factum of
payment was within his exclusive knowledge. However,
except relying upon the recital contained in the sale deed,
the respondent failed to produce any independent
documentary evidence such as bank records, receipts,
account books or any other contemporaneous material
evidencing payment. It was further argued that the
respondent’s plea that the entire consideration was paid in
cash is inherently improbable, particularly having regard to
the magnitude of the transaction and the requirements
under the Income Tax laws prevailing at the relevant time.
v) Placing reliance upon the admissions elicited from the
respondent during cross-examination, it is contended that
the property was never mutated in his name, that he did not
pay municipal property tax and that he had not separately
16
paid the cost of electrical fittings referred to in Clause 8 of
Ex.A1. According to the learned counsel, these
circumstances are wholly inconsistent with the conduct of a
bona fide purchaser who claims to have paid the entire
consideration and taken possession of the property.
vi) That the appellants are incorporated companies whose
affairs are managed through their Directors from time to
time. Therefore, the non-examination of Sri B.
Chandramouli, who had executed the sale deed on behalf of
the company, could not by itself justify drawing an adverse
inference. It was contended that PW.1, being a Director of the
appellant companies, was fully competent to depose on the
basis of the corporate records and that the trial Court
committed an error in discarding his testimony merely
because he had no personal knowledge of the original
transaction.
vii) That the trial Court misapplied Section 91 of the Indian
Evidence Act, 1872, as the said provision merely provides
that where the terms of a contract are reduced into writing,
the document itself constitutes the primary evidence of such
terms. However, Section 91 does not prohibit a party from
establishing that the recitals contained in the document do
not reflect the true transaction between the parties. It was
argued that the recitals relating to receipt of consideration
17
and delivery of possession were inserted only for collateral
purposes and were always intended to operate subject to the
respondent paying the consideration within the agreed period
of three months.
viii) That the trial Court erred in holding that the appellants were
only entitled to recover the unpaid sale consideration, if any
and could not seek cancellation of the registered sale deed.
According to the learned counsel, payment of consideration
is a condition precedent for the transfer of title and, where no
consideration has in fact passed, the vendor is entitled either
to seek cancellation of the sale deed or, in the alternative,
recover the unpaid consideration. It was contended that the
trial Court wrongly construed the remedy available under
Section 54 of the Transfer of Property Act, 1882.
ix) That the trial Court erred in holding that possession of the
suit schedule property had been delivered to the respondent.
It was contended that the property was in an unfinished
condition on the date of execution of the sale deed, rendering
delivery of possession improbable. The continued possession
of the appellants, who subsequently leased the premises to
defendant No.3, belies the respondent’s claim of possession.
It was further submitted that the respondent neither
initiated any civil or criminal proceedings nor issued any
legal notice alleging dispossession, and his explanation that
18
illness prevented him from commencing business, during
which period the appellants occupied the property, is wholly
improbable and unsupported by evidence.
x) That the respondent never issued any legal notice either to
the appellants or to the defendant No.3 asserting his alleged
possession or ownership over the suit schedule property,
which further weakens his claim.
xi) That the decree awarding mesne profits from 04.08.2006 is
unsustainable, as the respondent failed to establish that the
appellants had unlawfully occupied or encroached upon the
suit schedule property. It was submitted that, had the
respondent genuinely believed that the appellants had
trespassed into the property, he would have immediately
sought appropriate legal remedies. In the absence of any
such evidence, the direction awarding mesne profits is liable
to be set aside.
Submissions on behalf of the Respondent
18. The learned counsel appearing for the respondent advanced
the following submissions:
i) That the registered Sale Deed dated 24.12.2002
unequivocally records receipt of the entire sale consideration
of Rs.15,00,000/- and delivery of vacant possession of the
suit schedule property. Having voluntarily executed the said
19document, the appellants are estopped from disputing its
recitals or contending that no consideration had passed.
ii) That the respondent had paid the entire consideration in
cash as demanded by the appellants and that the omission
to mention the mode of payment in the sale deed, if any,
cannot enure to the benefit of the appellants, who
themselves prepared and executed the document. The
statutory presumption attached to a registered document
operates in favour of the respondent and the appellants have
failed to rebut the same by any cogent evidence.
iii) That the circumstances relied upon by the appellants,
namely non-mutation of the property, non-payment of
municipal taxes and non-payment towards electrical fittings,
are wholly inconsequential and do not dislodge the validity of
the registered sale deed or the payment of consideration. It
was argued that the respondent was in the process of
establishing an electronics showroom in the premises and,
having paid the entire sale consideration, the question of
granting the appellants any alternative relief for recovery of
the consideration does not arise.
iv) That PW.1 examined on behalf of the appellants admittedly
had no personal knowledge of the transaction, having
become associated with the appellant companies only
20subsequently, thus, the PW.1’s testimony was rightly
discarded by the trial Court. On the other hand, the
appellants failed to examine Sri B. Chandramouli, the
authorised signatory and executant of the registered sale
deed, thereby justifying the adverse inference drawn against
them under Section 114(g) of the Indian Evidence Act, 1872.
It was further submitted that the provisions of the
Companies Act cannot override the rules of evidence
contained in the Indian Evidence Act.
v) That the trial Court rightly applied Section 91 of the Indian
Evidence Act, 1872, in holding that where the terms of a
contract have been reduced into writing, the parties cannot
be permitted to contradict the written recitals by oral
evidence. According to the learned counsel, the allegation
that the recitals regarding payment of consideration and
delivery of possession were incorporated only to facilitate the
respondent’s tax requirements is a mere afterthought,
unsupported by any acceptable evidence.
vi) That the registered sale deed expressly records delivery of
vacant possession, which was in fact handed over to the
respondent. It was submitted that the respondent
commenced preparations to establish an electronic
showroom by storing construction material in the premises
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but could not immediately occupy it as minor works
remained to be completed and the shutters required
replacement by the appellants. During this period, the
respondent suffered an accidental injury and was confined to
bed, whereupon the appellants took advantage of his
absence, illegally re-entered the suit schedule property and
inducted the defendant No.3 as tenant. Upon learning of the
unauthorised occupation on 04.08.2006, the respondent
immediately visited the property and addressed a
communication to the appellants regarding the illegal
dispossession.
vii) That, by virtue of the registered sale deed, the respondent
acquired absolute title over the suit schedule property and,
the appellants having failed in their suit for cancellation of
the sale deed, the decree declaring the respondent as the
absolute owner calls for no interference. Consequently, the
appellants and the defendant No.3, having no manner of
right, title or interest over the suit schedule property, are
liable to vacate and deliver possession thereof to the
respondent.
viii) That the trial Court rightly awarded mesne profits from
04.08.2006, the date on which the respondent established
the appellants’ unauthorised occupation of the suit schedule
22
property. It was submitted that the defendant No.3 was
paying rent under a registered lease deed, and the trial Court
rightly directed determination of the quantum of mesne
profits in separate proceedings under Order XX Rule 12 CPC.
19. The learned counsel for the respondent in support of his case
has placed reliance upon the following decisions as under:
i. Damodhar Narayan Salwale (Dead) through legal
representatives v. Tejrao Bajirao and others 1ii. Ramaswamy (Dead) by LRs. v. M.Lobo (Dead) by LRs. 2
iii. Subhash Malhari Muneshwar and another v. Arvinde
Anandrao kadam and another 3iv. Nandam Mohanamma and others v. Markonda Narasimha
Rao and another 4v. Mangala WamanKarandikar (Dead) through legal
representatives v. Prakash Damodar Ranade 5vi. Hemalatha (D) by LRs. v. Tukaram (D) by LRs. 6
vii. Placido Francisco Pinto (Dead) by legal representatives and
another v. Jose Francisco Pinto and another 7
20. I have taken note of the respective submissions made and
the material on record including the plaint, written statement and
written submissions.
1 (2023) 19 SCC 175
2 (2001) 10 SCC 176
3 (2019) 17 SCC 685
4 2005 (5) ALD 296
5 (2021) 6 SCC 139
6 2026 SCC OnLine SC 106
7 (2024) 14 SCC 569
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Consideration by this Court
21. Insofar as the question whether the Trial Court was justified
in holding that the registered Sale Deed dated 24.12.2002 was
supported by consideration is concerned, it is well settled that a
registered instrument carries a presumption regarding the
correctness of its execution and the recitals contained therein,
though such presumption is rebuttable. The burden lies upon the
party disputing the recitals to establish, by cogent and convincing
evidence, that they do not reflect the true state of affairs.
22. In the present case, the registered Sale Deed (Ex.A1/Ex.B1)
contains an unequivocal recital acknowledging receipt of the entire
sale consideration of Rs.15,00,000/- and delivery of vacant
possession of the suit schedule property to the respondent.
Therefore, the initial burden squarely rests upon the appellants to
establish that the said recitals do not represent the true
transaction between the parties.
23. On perusal of the record it is evident that the appellants
have failed to discharge the burden cast upon them. The registered
Sale Deed was admittedly executed on behalf of the appellants by
Sri B. Chandramouli, the authorised signatory, who was the most
competent witness to depose regarding the circumstances under
which the sale deed came to be executed and whether the
consideration had in fact been received or not. However, the
24
appellants did not examine Sri B. Chandramouli, nor have they
assigned any satisfactory explanation for his non-examination.
Instead, appellants examined PW.1, who admittedly became
associated with the appellant companies subsequent to the
execution of the sale deed. PW.1 had no personal knowledge of the
transaction, and his deposition was founded entirely upon the
company records. Therefore, PW.1’s evidence, insofar as the
execution of the sale deed and payment of consideration are
concerned, carries no evidentiary value.
24. In these circumstances, the trial Court was justified in
drawing an adverse inference against the appellants under Section
114(g) of the Indian Evidence Act for withholding the best available
evidence.
25. It is pertinent to note that the appellants are incorporated
companies governed by the Companies Act. If, as alleged, the
registered sale deed had been executed without receipt of
consideration, it would be reasonable to expect some
contemporaneous corporate record or authorisation evidencing
such an extraordinary and exceptional transaction. Admittedly, no
Board Resolution or any other contemporaneous document has
been produced in support of such a plea. The absence of any such
material considerably weakens the appellants’ case.
25
26. It is also to be noted that the entire case of the appellants
rests upon an alleged oral understanding that the respondent
would pay the sale consideration within three months from the
date of execution of the sale deed. If such an arrangement had
indeed been agreed upon, there appears to be no plausible reason
as to why such an important condition was neither incorporated in
the registered sale deed nor reduced into writing by way of a
separate agreement. The absence of any contemporaneous written
record substantially detracts from the credibility of the appellants’
version who are companies incorporated under the Companies Act.
27. Further, the evidence of PW.1 also does not advance the
appellants’ case. On the contrary, during cross-examination, PW.1
admitted that Ex.A1 had been prepared by the appellants
themselves and that the sale deed expressly acknowledges receipt
of the sale consideration of Rs.15,00,000/-, which substantially
weakens the appellants’ challenge to the recitals contained in the
registered instrument.
28. The appellants contention that the omission in the registered
sale deed regarding the mode and date of payment of the sale
consideration, cannot be accepted. The omission to specify whether
the consideration was paid by cash, cheque or demand draft does
not displace the express acknowledgment of receipt of
consideration contained in the registered sale deed. More
26
importantly, Ex.A1 was admittedly drafted and executed by the
appellants themselves. Therefore, any omission in the drafting of
the document cannot be permitted to operate to the prejudice of
the respondent.
29. The respondent, examined as DW.1, consistently deposed
that he had paid the entire sale consideration in cash and that
possession of the suit schedule property was delivered
simultaneously with the execution of the sale deed. Despite cross-
examination, nothing substantial was elicited to discredit his
testimony. Though DW.1 admitted that the property had neither
been mutated in his name nor were municipal taxes paid by him,
these circumstances do not establish non-payment of
consideration. DW.1’s explanation that he was in the process of
establishing his business and that the appellants subsequently re-
entered the premises cannot be said to be inherently improbable.
30. It is also significant to note that the PW.1 admitted that the
appellants had not issued any legal notice or written demand
calling upon the respondent to pay the alleged unpaid sale
consideration prior to the institution of the suit. If, in fact, an
amount of Rs.15,00,000/- had remained unpaid, the absence of
any contemporaneous written demand more particularly by a
company constitutes another circumstance which weakens the
appellants’ case. Thus, the appellants have failed to rebut the
27
presumption attached to the registered Sale Deed or establish that
the recitals acknowledging receipt of consideration do not reflect
the true transaction between the parties.
31. It is pertinent to note that the registered Sale Deed dated
24.12.2002 contains an unequivocal recital that vacant possession
of the suit schedule property was delivered to the respondent
contemporaneously with its execution. Such recital, forming part of
a registered instrument, carries considerable evidentiary value and
the burden lies upon the appellants to establish that the same
does not reflect the true state of affairs. However, on perusal of the
evidence on record, it is evident that the appellants have failed to
discharge the burden of disproving the recital relating to delivery of
possession.
32. It is apposite to note that the respondent, examined as DW.1
deposed that possession of the suit schedule property was
delivered to him on the date of execution of the sale deed and that
he had commenced preparations for establishing an electronics
showroom by storing construction materials in the premises.
DW.1’s testimony remained substantially unshaken in cross-
examination and is in consonance with the recitals contained in
the registered sale deed.
33. Further, the appellants contention that the building was in
an unfinished condition on the date of execution of the sale deed
28
and possession could not have been delivered, merits no
consideration. Merely because certain finishing works remained to
be completed does not necessarily lead to the conclusion that
possession was incapable of being delivered. Thus the trial Court
has rightly observed that an unfinished commercial unit can
nevertheless be delivered to the purchaser.
34. The reliance placed by the appellants upon the registered
lease deed executed in favour of the defendant No.3 also does not
advance their case. The lease deed only establishes that the
appellants were in possession of the property when the lease was
executed. By itself, it does not establish that possession had never
been delivered to the respondent. On the contrary, the possibility
that the appellants, being the original owners and developers of the
property, subsequently re-entered the premises and inducted the
defendant No.3 cannot be ruled out.
35. The contention of the appellants that the respondent did not
lodge a police complaint immediately upon the alleged
dispossession does not merit acceptance. The respondent
explained that, on learning of the unauthorised occupation on
04.08.2006, he immediately approached the police, who declined to
intervene on the ground that the dispute was civil in nature. In the
facts of the case, this explanation cannot be said to be inherently
improbable.
29
36. In view of the above, this Court is of the view that the finding
recorded by the Trial Court on the issue of possession is well-
founded and warrants no interference.
37. It is to be noted that the principal grounds urged by the
appellants for cancellation of the sale deed were that the
transaction was unsupported by consideration, possession had not
been delivered, and that the respondent had procured the sale
deed by practising fraud and breach of trust. As already discussed
hereinabove, the appellants have failed to substantiate any of these
allegations by cogent and convincing evidence. The plea of fraud or
misrepresentation has remained a bald assertion, unsupported by
any contemporaneous document or reliable oral evidence.
Therefore, the conclusion reached by the trial Court that no ground
had been made out for cancellation of the registered sale deed,
does not warrant interference.
38. Even otherwise, assuming that the sale consideration had
remained unpaid, such circumstance, by itself, would not entitle
the appellants to seek cancellation of a completed sale. The remedy
available to the vendor in such a situation is to seek recovery of the
unpaid sale consideration in accordance with law and not to avoid
the transfer itself. However, in the present case, the appellants
have failed to establish that any part of the agreed consideration
remained unpaid. Therefore, the trial Court committed no error in
30
dismissing O.S.No.34 of 2005, as the appellants failed to establish
their entitlement to either cancellation of the registered sale deed
or to the alternative relief claimed by them.
39. Moreover, having affirmed the validity of the registered Sale
Deed dated 24.12.2002 and upheld the dismissal of O.S.No.34 of
2005, the respondent’s title to the suit schedule property
necessarily stands established. Once the appellants failed to prove
any legal ground for cancellation of the sale deed, the respondent,
being the purchaser under the registered instrument, became
entitled to a declaration of title.
40. The evidence on record also establishes that the appellants,
having re-entered the suit schedule property and inducted the
defendant No.3 as tenant, continued in possession without any
lawful authority. Consequently, the decree directing the appellants
and the defendant No.3 to vacate and deliver vacant possession of
the suit schedule property to the respondent is fully justified and
warrants no interference. Therefore, the trial Court has also rightly
held that the respondent is entitled to mesne profits from
04.08.2006, the date from which the unauthorised occupation of
the appellants stood established. The direction for determination of
the quantum of mesne profits in separate proceedings under Order
XX Rule 12 of CPC does not call for interference.
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Conclusion
41. For the foregoing reasons, this Court is of the view that the
learned I Additional Chief Judge, City Civil Court, Secunderabad,
upon a proper appreciation of the oral and documentary evidence
on record and the settled principles of law, rightly dismissed
O.S.No.34 of 2005 and decreed O.S. No.119 of 2006. This Court
finds no perversity, illegality or infirmity in the common judgment
and decree dated 21.08.2015 warranting interference.
42. Accordingly, C.C.C.A.No.33 and 34 of 2016 are dismissed.
The judgment and decree dated 21.08.2015 passed in O.S.No.34 of
2005 and O.S.No.119 of 2006 by the learned I Additional Chief
Judge, City Civil Court, Secunderabad shall stand affirmed. It is
directed that the trial Court shall verify compliance with the
interim order dated 18.04.2016 passed by this Court in CCCAMP
No.108 of 2016, whereby stay of the operation of the judgment and
decree in O.S.No.119 of 2006 was granted subject to the appellants
depositing the accrued mesne profits at the rate of Rs.11,250/- per
month together with the costs awarded, as well as the subsequent
order dated 13.03.2017 passed in CCCAMP No.492 of 2016
permitting the respondent to withdraw the amounts so deposited
upon furnishing a personal bond and shall thereafter proceed in
accordance with law.
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As a sequel, miscellaneous applications pending if any in the
appeal, shall stand closed. No costs.
_____________________
G.M.MOHIUDDIN, J
Date: 24.07.2026
ssp
