*IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 16th May, 2014
+ FAO(OS) No.89/2014
BHUPINDER NARAIN BHATNAGAR ..... Appellant
Through: Mr. Sanjay Katyal, Adv.
Versus
MAHESH SINGHAL ..... Respondent
Through: Mr. Rajshekhar Rao & Mr. Yogesh
Raavi, Advs.
CORAM :-
HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
RAJIV SAHAI ENDLAW, J.
1. The appeal impugns the order dated 06.12.2013 of the learned Single Judge (exercising Ordinary Original Civil Jurisdiction) of allowing IA No.22691/2012 of the respondent / plaintiff and thereby permitting the respondent / plaintiff to take back the amount of Rs.3.73 crores deposited in this Court together with interest accrued thereon. The appeal was accompanied with an application for condonation of 18 days delay in filing thereof.
2. We have without hearing the counsels on the aspect of delay, heard them on the merits of the appeal. Resultantly, for the sake of record, the delay in filing the appeal is condoned.
FAO (OS) No.89/2014 Page 1 of 8
3. The respondent / plaintiff instituted the suit from which this appeal arises for the relief of specific performance of an Agreement of Sale of property No.213, Dayanand Vihar, Delhi-110 092 by the appellant / defendant to the respondent / plaintiff for a total sale consideration of Rs.3.83 crores out of which a sum of Rs.10 lacs was paid as earnest money and the balance Rs.3.73 crores was to be paid on or before 15.01.2012.
4. The suit along with the application for interim relief came up before the learned Single Judge first on 13.02.2012 when the counsel for the respondent / plaintiff made a statement that the respondent / plaintiff was ready and willing to deposit the balance amount of Rs.3.73 crores in the form of fixed deposit in this Court. Accordingly, subject to the said deposit, the appellant / defendant was restrained from creating any third party interest in or transferring the possession of the said property in favour of any third person. The said application for interim relief is still pending consideration.
5. The respondent / plaintiff filed IA No.22691/2012 (supra) seeking to withdraw the deposit pleading; (i) that the respondent / plaintiff by making the deposit had already demonstrated his bona fides; (ii) that the appellant / defendant had been delaying the matter and had avoided filing of written statement on one pretext or the other; (iii) that in the meanwhile, the respondent FAO (OS) No.89/2014 Page 2 of 8 / plaintiff was suffering as he had borrowed the said sum of Rs.3.73 crores deposited in this Court and was paying commercial rate of interest thereon; (iv) an undertaking was also given to re-deposit the money in the Court as and when called upon to do so.
6. Surprisingly, the appellant / defendant instead of arguing on the application for interim relief contested the aforesaid application.
7. The learned Single Judge has allowed the respondent / plaintiff to withdraw the said amount observing that no purpose would be served in having the same lying in Court and on the condition of expediting the trial and accepting the undertaking of the respondent / plaintiff to re-deposit the amount in the Court as and when directed.
8. We have today in our judgment in FAO(OS) No.239/2014 titled Bal Krishan Gupta Vs. Vikas Aggarwal also dealt with the aspect of issuance of a direction to the plaintiff in a suit for specific performance of an Agreement of Sale of immovable property for deposit of balance sale consideration in the Court and have on a conspectus of the judgments in this regard culled out the position in law as under:-
FAO (OS) No.89/2014 Page 3 of 8
(i) Section 16(c) of the Specific Relief Act, 1963 provides that specific performance of a contract cannot be enforced in favour of a person who fails to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him. It is thus necessary for a plaintiff in a suit for specific performance, to aver and prove that he, on the stipulated date, was in a position to pay the balance sale consideration and had tendered or was ready and willing to tender the same to the seller;
(ii) however the Explanation (i) of Section 16(c) supra provides that where the contract involves the payment of money, it is not essential for the plaintiff to actually tender to the defendant or to deposit in the Court any money except when so directed by the Court. Thus the plaintiff in a suit for specific performance, is not required to as a matter of routine and as a condition to the maintainability of the suit, deposit the balance sale consideration in the Court, though the Court is empowered to direct the plaintiff to do so;
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(iii) if as per the agreement of which specific performance is sought, the plaintiff / purchaser was required to part with the balance sale consideration only against delivery of title and physical possession of the property, to make such a plaintiff / purchaser part with the balance sale consideration without delivery of title and possession to him would be contrary to the agreement and the jurisdiction of specific performance thereof;
(iv) to hold that though as per the agreement the plaintiff / purchaser is liable to part with the balance sale consideration only against the delivery of title and possession but to test his readiness and willingness, he can be directed to part therewith even without delivery of title and possession, would amount to the Court making a new contract and which is beyond the scope of jurisdiction of specific performance;
(v) a direction to the plaintiff / purchaser to deposit balance sale consideration in the Court as a condition to maintainability of the suit for specific performance can be made only where the Court, for reasons to be recorded, entertains a doubt about the readiness and willingness of the plaintiff / purchaser. Only where the Court FAO (OS) No.89/2014 Page 5 of 8 feels that though an averment as postulated in Section 16(c) is made, but the plaintiff may not have the money to pay the balance consideration, can the Court, to satisfy itself about the truthfulness about the averment, direct to deposit the money in Court. This course is however to be adopted rarely;
(vi) the question of payment otherwise would arise only after the trial of the suit and when the rights of the parties are determined and such a direction should be issued when the final decree is passed and not at an earlier point of time; and
(vii) direction to the plaintiff / purchaser to deposit the balance sale consideration in the Court can also be made as a condition for granting interim relief sought of restraining the defendant / seller from, during the pendency of the suit, dealing with the property agreed to be sold or to balance the equities in appropriate cases but again, not as a matter of routine i.e. only where the readiness and willingness of the plaintiff / purchaser is in doubt and again, rarely; the effect of non-deposit inspite of such direction in such cases will only be vacation of the interim order or applicability of Section 52 FAO (OS) No.89/2014 Page 6 of 8 supra and not to ipso-facto presume the plaintiff / purchaser to have been not ready and willing.
9. As far as the facts of the present case are concerned, the stage for the Suit Court to judge whether the plea of the respondent / plaintiff in Section 16(c) is reliable or not has not reached as the application for interim relief is still pending consideration and has not been disposed of. The balance sale consideration came to be deposited in the Court on the own offering of the respondent / plaintiff and without the Court returning any finding or prima facie finding of the respondent / plaintiff being in default or being not ready and willing. Just like the respondent / plaintiff had on an earlier occasion volunteered to deposit balance sale consideration, the respondent / plaintiff subsequently sought withdrawal thereof. The impact of such actions of the respondent / plaintiff has also not been discussed. We find it strange that the appellant / defendant instead of urging that owing to the respondent / plaintiff now wanting to withdraw the balance sale consideration, the ex parte order earlier obtained by the respondent / plaintiff on the strength of such deposit should be vacated or that the applicability of Section 52 of the Transfer of Property Act be exempted (as has been held in Vinod Seth Vs. Devinder Bajaj (2010) 8 SCC 1 to be within the powers of the Court) is FAO (OS) No.89/2014 Page 7 of 8 opposing the prayer of the respondent / plaintiff for withdrawal of the balance sale consideration deposited in the Court. The same is indicative of a dangerous trend, of the litigation being literally fought adversarial by mechanically opposing whatever the opponent seeks, without even considering the impact of the conduct of the opponent on the case.
10. We therefore do not find any merit in this appeal and dismiss the same.
No costs.
RAJIV SAHAI ENDLAW, J.
CHIEF JUSTICE MAY 16, 2014 'gsr'/ pp FAO (OS) No.89/2014 Page 8 of 8