Chhattisgarh High Court Refuses Specific Performance, Says Registered Agreement Alone Does Not Prove Valid Sale if Execution Remains Doubtful

News Citation : 2026 LN (HC) 413

August 3, 2026 : In a significant judgment reiterating the legal principles governing agreements executed by illiterate persons, the Chhattisgarh High Court has dismissed a first appeal seeking specific performance of an alleged property sale agreement, holding that mere registration of a document does not automatically establish its valid execution. The Division Bench ruled that when the executant is an illiterate person who disputes the transaction, the burden lies on the beneficiary of the document to prove that its contents were properly explained and voluntarily understood before obtaining the thumb impression.

The judgment was delivered on August 3, 2026, by a Division Bench comprising Justice Parth Prateem Sahu and Justice Sachin Singh Rajput in FA No. 31 of 2023, Swatantra Pandey v. Smt. K. Mahalaxmi Reddy, reported as 2026:CGHC:33508-DB. The Bench upheld the judgment of the Third Additional District Judge, Raipur, which had dismissed the plaintiff’s suit for specific performance of an agreement relating to a residential property situated at Dumartalab, Raipur.

According to the plaintiff, the defendant had agreed to sell the property for ₹13 lakh, received ₹12 lakh in cash on March 17, 2015, and executed a registered agreement to sell. The plaintiff claimed that the remaining ₹1 lakh was to be paid at the time of execution of the sale deed. He further alleged that although the period for registration of the sale deed was subsequently extended through another agreement, the defendant repeatedly avoided completing the transaction despite legal notices and personal requests. The plaintiff therefore approached the civil court seeking a decree for specific performance under the Specific Relief Act, 1963.

The defendant, however, denied entering into any agreement to sell. She contended that she was an illiterate woman with no independent source of income and had borrowed only ₹1 lakh from the plaintiff by mortgaging the property. According to her defence, the plaintiff misrepresented certain documents as mortgage papers, obtained her thumb impressions on blank and pre-printed documents, and later fabricated sale agreements and a power of attorney to claim ownership over the property. She maintained that the loan had already been repaid with interest and alleged that the suit was an attempt to grab her property through fraudulent documents.

The High Court examined the oral and documentary evidence in detail and found several circumstances that cast serious doubt on the plaintiff’s version. The Bench noted that although the plaintiff relied upon a registered agreement to sell, he admitted during cross-examination that he was a student at the relevant time and had no independent source of income. He also failed to produce any documentary evidence showing how he or his father arranged ₹12 lakh in cash, despite claiming that such a substantial amount had been paid to the defendant. The Court observed that in a suit seeking specific performance based on payment of a large cash consideration, the plaintiff must satisfactorily establish the source and availability of the money, which he failed to do.

Another factor that weighed heavily with the Court was the simultaneous execution of a registered agreement to sell and a registered general power of attorney on the same day concerning the same property. The Bench found it unusual that neither document referred to the other, even though both formed part of the alleged transaction. The Court observed that the execution of two independent documents without explaining their relationship created serious doubt regarding their authenticity and the true nature of the transaction.

The Court also emphasized that the defendant was admittedly illiterate and unable to read or write Hindi. In such circumstances, it held that the plaintiff had a legal obligation to prove that the contents of the agreement had been properly read over and explained to the defendant in a language she understood before obtaining her thumb impression. Although the plaintiff claimed that the defendant’s husband had explained the contents of the documents, he was neither an attesting witness nor examined before the Court. The Bench held that the plaintiff had therefore failed to produce the best available evidence regarding the execution of the agreement.

Referring to several judicial precedents, including Krishna Mohan Kul v. Pratima Maity (2004) 9 SCC 468, the High Court reiterated that when documents are executed by illiterate persons, the law imposes a higher responsibility upon the beneficiary to establish that the executant fully understood the nature and consequences of the transaction. The Court observed that “due execution of a document does not merely mean obtaining a signature or thumb impression. It also requires proof that the executant consciously understood and voluntarily accepted the contents of the document.”

The Bench further explained that civil cases are decided on the principle of preponderance of probabilities under the Indian Evidence Act, 1872, and not on proof beyond reasonable doubt. After evaluating the surrounding circumstances, the documentary record, and the oral evidence, the Court concluded that the defendant’s explanation appeared more probable than the plaintiff’s claim. It observed that payment of more than 90 percent of the sale consideration at the agreement stage without registering the sale deed itself, and without explaining why the sale could not be completed immediately, further weakened the plaintiff’s case.

The High Court rejected the appellant’s reliance on Supreme Court decisions dealing with illiteracy and adverse inference, holding that those precedents were distinguishable on facts. It clarified that the plaintiff first had to establish the valid execution of the agreement before any burden could shift to the defendant. Since that initial burden remained undischarged, the appeal lacked merit.

Dismissing the appeal, the Division Bench affirmed the trial court’s findings, holding that there was no perversity or legal error warranting interference. The parties were directed to bear their own costs. The ruling reinforces the principle that registration of an agreement is not conclusive proof of its validity where execution is seriously disputed, particularly when the executant is an illiterate person and surrounding circumstances create genuine doubt about the transaction. The judgment is likely to have considerable significance in future property disputes involving allegations of fraud, misrepresentation, and specific performance of contracts.

Case Reference: Swatantra Pandey v. Smt. K. Mahalaxmi Reddy, FA No. 31 of 2023