Keshao Mahadeo Naktode Wardha vs Sadanand Ramji Bhagat Wardha
2017 Latest Caselaw 8904 Bom

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             IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                       NAGPUR BENCH AT NAGPUR

                          SECOND APPEAL NO.421/2004

      Keshao s/o Mahadeo Naktode, 
      aged about 53 years, Occ. Cultivator,
      r/o Allipur, Tq. Hinganghat, Dist. Wardha. .....APPELLANT

                               ...V E R S U S...

      Sadanand s/o Ramaji Bhagat,
      aged 63 years, Occ. Cultivator and
      Business, r/o Borgaon (Aloda),
      Tq. Deoli, Dist. Wardha.                               ...RESPONDENT

 -----------------------------------------------------------------------------------------------
 Mrs. A. R. Khare, Advocate for appellant.
 Mr. S. S. Deshmukh, Advocate for respondent.
 -----------------------------------------------------------------------------------------------

                               CORAM:- V. M. DESHPANDE, J.

DATED :- 24.11.2017

ORAL JUDGMENT

1. Heard Mrs. A. R. Khare, Advocate for appellant and Mr.S. S.

Deshmukh, Advocate for respondent.

2. On 12.01.2005, the present appeal was admitted on the

following substantial question of law.

(i) Whether specific performance of an agreement of sale and delivery of possession could be granted to the defendant in counter claim when perpetual injunction restraining the defendants from disturbing the possession of the plaintiff has been granted?

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3. During the pendency of the present second appeal, an

application, Civil Application No.823/2017 was filed under Section 100

read with Order XLI Rule 2 of the Code of Civil Procedure for permission

to raise additional substantial question of law. As per this, following

substantial question of law arises, is the submission of the learned

counsel for the applicant.

"Can readiness and willingness to pay less than actual balance of sale consideration entitles the defendant-counter claimant to decree of specific performance of contract of sale?"

On 14.08.2017, this Court observed that this application will

be considered at the time of final hearing.

4. The second appeal was called out for final hearing on

23.11.2017. On this application, elaborate submissions were made.

After hearing the learned counsel for the parties, following substantial

question of law was also framed.

(1-A) Could it be said that in the given set of facts and the evidence as brought on record, the respondent-original defendant- counter claimant was ready and willing to perform his part of contract?

5. In the present case, the appellant and respondent will be

described as per their original positions in the suit. This appellant is

plaintiff and the respondent is defendant.

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6. The plaintiff approached before the Court of law by filing the

suit for permanent injunction against the defendant. The said suit was

registered as Regular Civil Suit No.228/1991. The suit was allotted to

the file of learned Jt. Civil Judge Senior Division, Wardha.

7. As per the plaintiff, the plaintiff is owner of the agricultural

land situated at Mouja Borgaon (Aloda), Taluka Deoli, District Wardha

having Survey No.212/1 (hereinafter referred to as "Suit Field") The

suit field admeasures 2.20 HR and it is in cultivating possession of the

plaintiff.

8. The plaintiff also states that on 09.05.1989, the plaintiff

agreed to sell the suit property to the defendant for consideration of

Rs.17,500/- and the earnest note was executed in favour of the

defendant at Alipur. At the time of execution of earnest note an earnest

amount of Rs.10,000/- was paid to the plaintiff and the agreed date for

execution of the sale deed was 15.04.1990. According to the plaintiff,

the possession of the suit field was to be given at the time of execution

of the sale deed.

9. The plaint further recites that on 15.04.1990, the defendant

conveyed to the plaintiff that he is not in position to get the sale deed

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executed and therefore he asked for extension of the date for execution

of the sale deed. For this reason, in the earnest note itself, the date for

execution of the sale deed was extended up to 01.05.1991. It is also

stated in the plaint that though the earnest note is executed at Alipur,

insofar as the extension of the date was concerned, it was carried out at

the village of plaintiff i.e. Borgaon (Aloda).

10. It is further the case in the plaint that the defendant was not

resident of Borgaon (Aloda) and he is resident of Nagpur. However,

subsequently, he shifted from Nagpur to Borgaon and started disturbing

possession of the plaintiff. It is also the case of the plaintiff before the

trial Court as it could be seen from the plaint that on 01.05.1991, the

plaintiff requested the defendant that the extended date for execution of

the sale deed is coming near and therefore he could get the sale deed

executed. However, it was informed that the defendant was not

interested in execution of the sale deed in his favour and the plaintiff

should refund his earnest amount. As per the plaintiff, the defendant

was not in a position to get the sale deed executed in his favour.

11. As per the plaintiff, though the plaintiff was having

cultivating possession, the defendant tried to dispossess him by taking

advantage of execution of earnest note. Therefore, the suit for

injunction was filed with a prayer that the defendant and/or anybody

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claiming through him shall be restrained permanently from disturbing

the peaceful possession of the plaintiff over the suit property.

12. On being summoned, the defendant appeared and filed his

written statement (Exh.-25). Not only he filed the written statement but

also raised counter claim. In the said counter claim, he prayed for grant

of decree of specific performance of contract by paying the requisite

Court fee. According to the counter claim, after execution of the earnest

note dated 10.05.1989, on 31.03.1990, he paid Rs.1500/- to the

plaintiff and on 15.04.1990, he paid Rs.1,000/- to the plaintiff. Thus, in

totality, according to the defendant, he paid Rs.12,500/-. As per the

counter claim, the defendant was always ready to pay the balance

amount of Rs.5,000/- and in fact on 01.05.1991, he came to the office

of Sub Registrar, Wardha with the remaining amount of Rs.5,000/- for

execution of the sale deed and was waiting for the plaintiff till 5.00 p.m.

However, the plaintiff failed to attend the office of Sub Registrar.

Therefore, on 28.06.1991, he sent a registered notice. By the said

notice, the defendant asked the plaintiff to remain present on

08.07.1991 in the office of Registrar at Wardha for execution of the sale

deed. However, the said notice was refused by the plaintiff. It is further

case of the defendant in the counter claim that he was ready and willing

to perform his part of contract i.e. execution of the sale deed in his

favour by paying the balance consideration of Rs.5,000/- to the plaintiff.

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He therefore prayed for a decree of specific performance of contract.

13. On the basis of the rival pleadings, the learned Judge of the

trial Court framed following issues:

"1. Whether the plaintiff proves that he is in possession of the suit field?

2. Whether the defendant proves that he is ready and willing to perform his part of contract?

3. Whether the defendant proves that he paid Rs.12,500/- as earnest amount to the plaintiff?

4. Whether the plaintiff is entitled for permanent injunction as sought for?

5. Whether the defendant is entitled for decree of specific performance of contract?

6. Whether the defendant is entitled to refund of earnest money of Rs.12,500/- with interest at the rate of Rs.16% p.a.?

7. Whether the defendant is entitled to recover the possession of the suit field from the plaintiff?

The parties went on trial in order to prove their respective

cases. The learned Judge of the trial Court, vide judgment and decree

dated 17.08.2000, decreed the suit for injunction and also granted

decree of specific performance of contract. The operative order of the

impugned judgment delivered by the learned trial Court is reproduced

hereinbelow:

"i. The plaintiff's suit for injunction is decreed and by order of permanent injunction, the defendant Sadanand Bhagat is hereby

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permanently restrained from disturbing the peaceful possession of the plaintiff in a suit field bearing No. 212/1, admeasuring 2.20 HR situated at mouza Borgaon (Aloda) Tahsil Deoli, Distt. Wardha, without following due process of law.

ii. The defendant's counter-claim for specific performance of contract is allowed and decreed. The plaintiff is hereby directed to execute the sale-deed of the suit field survey no.212/1, admeasuring 2.20 HR situated at mouza Borgaon (Aloda), Tahsil Deoli, Distt. Wardha after receipt of balance amount of consideration i.e. Rs.7500/- from the defendant and do hand over the vacant possession after execution of sale-deed.

iii. The defendant Sadanand Ramji Bhagat is hereby directed to deposit Rs.7,500/- in the Court towards the balance of consideration within one month from today to have the execution of sale-deed in his favour and after execution of sale-deed the plaintiff may have the amount so deposited by defendant.

iv. If the plaintiff fails to execute the sale-deed after depositing of Rs.7500/- by the defendant in the Court then the defendant have the execution of sale-deed through Court.

v. Parties to bear their own costs.

14. Being dissatisfied with the decree passed in counter claim in

the nature of decree of specific performance of contract against the

plaintiff, he filed Regular Civil Appeal No.1/2001. Mr. Deshmukh,

learned counsel for the respondent-original defendant submitted that

though the defendant suffered a decree of permanent injunction, he did

not file any appeal nor filed cross-appeal in the appeal filed by plaintiff.

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15. After hearing the parties to the appeal, vide judgment dated

05.07.2004, the learned District Judge Wardha dismissed the appeal.

Hence this Second Appeal.

16. During the course of arguments, Mrs. Khare, the learned

counsel for the appellant, submitted that she is not making any

submission in respect of the substantial question of law that was

formulated on 12.01.2005 and her arguments are restricted only to the

substantial question of law (1-A) which pertains to willingness and

readiness of the defendant.

17. After inviting my attention to the finding recorded by the

learned trial Court, she submitted that the learned trial Court

specifically turned down the case of the defendant that he paid

Rs.2500/- in addition to Rs.10,000/-, which was paid at the time of

execution of the earnest note and though an opportunity was available

to the defendant to file cross-appeal to challenge the said finding, the

defendant chose not to file any cross-appeal. Resultantly, the finding of

fact recorded that only Rs.10,000/- was paid by the defendant to the

plaintiff has attained finality. She submitted that therefore even if the

entire case of the defendant is accepted for the sake of argument, on the

date when the defendant claimed that he was present in the office of

Sub Registrar, he was not present with the remaining amount of

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consideration. Resultantly, her submission is that a finding will have to

be recorded that the defendant was not ready and willing to perform his

part of contract. She invited my attention to the paragraph nos. 11 and

12 of the reported case in Malkiat Singh (Deceased by LRs.) Vs. Om

Prakash (deceased) by LRs.) and anr.; AIR 2004 Punjab & Haryana,

253, and prayed that the appeal be allowed.

18. Per Contra, Mr. Deshmukh, the learned counsel for the

defendant submitted that he has proved his presence at the office of Sub

Registrar, Wardha along with the balance consideration of Rs.5,000/-.

He submitted that once the agreement in question is admitted by the

plaintiff and once he has admitted that he has received Rs.10,000/- as

the earnest amount, it was the duty of the plaintiff to remain present in

the office of Sub Registrar. He submitted that the plaintiff has given

acknowledgement which is at Exh.-50, which shows that on 31.03.1990,

the plaintiff has taken Rs.1500/-. He further submitted that in view of

Section 16 (c) of the Specific Relief Act, it is not that the plaintiff must

prove that he has actually tendered payment of money to the defendant

but to plead and prove that he was always ready and willing to perform

the essential terms of the contract which were to be performed by him is

sufficient and for that he placed reliance on a reported case of Mustt.

Sabira Khatun Vs. Mustt. Syeda Fatema Khatoon,1995 Gauhati 104. He

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also invited my attention to the law laid down in K Prakash Vs. B.R.

Sampath Kumar; (2015) 1 SCC 597 in respect of interference by the

appellate Court with the discretion exercised by the trial Court and

submitted that the appeal be dismissed.

19. After hearing the parties to this appeal and in view of the

provisions of Rule 6A of Order VIII of the Code of Civil Procedure, in my

view, question of law which was formulated on 12.01.2005 does not fall

for consideration. In addition to it, the appellant has not made any

submission in that behalf.

20. Most of the facts in the present appeal are admitted. It is not

in dispute that the plaintiff is owner of the suit field. It is also not in

dispute that on 19.05.1989, an agreement of sale Exh.-51 was executed

in between the plaintiff and defendant. There is no quarrel that the

agreed consideration was Rs.17,500/-. It is also not in dispute that at

the time of execution of the earnest note Exh.-51, the plaintiff obtained

Rs.10,000/- from the defendant towards earnest money. It is also not in

dispute that originally, the agreed date for execution of the sale deed

was 15.04.1990 and the said time was extended by consent of the

parties to 01.05.1991 and the said date was incorporated in the earnest

note Exh.-51.

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21. The dispute is whether the defendant was ready to perform

his part of contract i.e. whether he was ready to obtain the sale deed in

his favour by paying the balance consideration.

22. As observed, there is no dispute about the payment of

earnest amount of Rs.10,000/- at the time of execution of agreement of

sale Exh.-51 on 09.05.1989. There is a dispute in between the parties

about the further payment of Rs.2500/- on two different dates. As per

the counter claim, the defendant submitted that on 31.03.1990, he paid

Rs.1500/- and on 15.04.1990, he paid Rs.1,000/- in addition to

Rs.10,000/-. Thus, in totality, he has paid Rs.12,500/- and he was

under obligation only to pay Rs.5,000/-. In the counter claim, the

defendant has prayed the following relief:

"(i) to pass a decree in favuor of the defendant for specific performance of contract i.e. execution of sale-deed in his favour by paying remaining amount of balance consideration of Rs.5,000/- to the plaintiff.

Or in the alternative-

(ii) refund of earnest money of Rs.12,500/- with interest thereon at the rate of 18% percent per annum from 10-5-89 and onwards.

Or in the alternative-

(iii) to direct the plaintiff to hand over the possession of the suit field in favour of the defendant.

(iv) Costs of the counter claim be saddled on the plaintiff.

(v) to grant any other relief in favour of defendant in the circumstances of the case which the Honourable Court thinks just and proper."

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23. To the counter claim, the plaintiff filed his written statement

and thereby raised serious dispute; (i) regarding payment of Rs.2500/-

by way of two different dates and (ii) the defendant was to pay only

Rs.5000/- by way of balance consideration.

24. As observed in the earlier part of the judgment, on the basis

of the pleadings, the learned trial Court framed the issues. Issue no.3

was as to whether defendant has proved that he has paid Rs.12,000/- as

earnest amount to the plaintiff.

25. Exh.-50 on which the learned counsel for the defendant has

heavily relied is in the nature of acknowledgment. Despite that on

31.03.1990, Rs.1500/- was taken and below that there is signature as

"कक. म. ननगततडक" and it is also signed by "शनमरनव जनगतजज टटपलक". The said

document also shows that Rs.7000/- is remained to be paid. This

document was brought on record from the side of the defendant. The

witness Shamrao Tiple was not examined by the defendant.

26. The learned trial Judge has recorded a specific finding of fact

that the defendant failed to prove that on 31.03.1990, he paid

Rs.1,500/- and on 15.04.1990 he paid Rs.1000/-to the plaintiff. Not

only that the learned trial Court has discarded the document Exh.-50.

The learned trial Court thereafter recorded a specific finding that the

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defendant has proved that he has paid only Rs.10,000/- to the plaintiff

and not Rs.12,500/- as claimed by the defendant. Thus, it is crystal

clear that the remaining agreed sale consideration was Rs.7500/- and

the defendant was under obligation to pay the said remaining

consideration for obtaining the sale deed in his favour.

27. Though, issue no.3 was recorded against the defendant and

though the opportunity was available to the defendant to file cross-

appeal in the appeal filed by the plaintiff, the said finding was not

questioned. Thus, the finding of fact that the defendant paid only

Rs.10,000/- and he failed to prove his case that he paid Rs.2500/- after

execution of earnest note (Exh.-51), has attained finality.

28. The law about readiness and willingness is well crystallized

by various judicial pronouncements. It is always on the shoulder of a

party who claims decree for specific performance of contract to show

continued readiness and willingness to perform his part of contract in

accordance with the terms from the date of contract.

29. In the present case, the parties agreed to sell and purchase of

the suit field for consideration of Rs.17,500/-. Rs.10,000/- were paid to

the vendor. Thus, the vendee was to pay Rs.7500/- at the time of

execution of the sale deed before the Sub Registrar, Wardha, is the

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covenant in the earnest note Exh.-51. Except this covenant, there are no

other terms and conditions. Thus essential condition in this contract, as

it is spelt out from Exh.-51, is that the vendee (defendant) was under an

obligation to pay Rs.7500/- on the agreed date for execution of the sale

deed before the Sub Registrar.

30. The extended date, as per Exh.-51 is 01.05.1991. However,

as per notice Exh.-72, which according to the defendant, was refused by

the plaintiff, the defendant remained present in the office of Sub

Registrar on 08.07.1991 with Rs.5000/- with him. It is not the case of

the defendant that on the said date, he was present in the office of Sub

Registrar along with an amount of Rs.7500/- but it is his specific case in

the counter claim and also in his evidence that only an amount of

Rs.5000/- was with him on 08.07.1991 for getting the sale deed

executed in his favour.

31. Once, the defendant has failed to prove that he has paid

Rs.2500/- to the plaintiff and in that behalf a finding of fact is recorded

against the defendant, the balance amount was Rs.7500/-. Since

admittedly the defendant was not having the said amount with him in

the office of Sub Registrar, in my view, it could not be said that the

defendant was ready and willing to perform his part of contract

inasmuch as, as per the essential term of the agreement Exh.-51, balance

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amount of Rs.7500/- was to be paid at the time of execution of sale

deed. Consequently, in my view, both the Courts below have committed

error in granting the decree for specific performance of contract in

favour of the defendant. This is required to be set aside by answering

the substantial question of law as formulated that the defendant was not

ready and willing to perform his part of contract.

32. Since the defendant has paid an amount of Rs.10,000/- and

the said fact is not denied by the plaintiff and also there is no clause of

forfeiture of the said earnest amount, in my view, the plaintiff is

required to refund Rs.10,000/- to the defendant along with interest at

6% per annum from 10.05.1989 till its actual realization. The plaintiff

is directed to refund Rs.10,000/- along with interest at the rate of 6%

per annum from 10.05.1989 within a period of six months from today,

failing which it will be open for the defendant to recover the same from

the plaintiff, in accordance with law.

33. In view of above, the second appeal is partly allowed. The

judgment and decree passed by Jt. Civil Judge Junior Division, Wardha

in Regular Civil Suit No.228/1991, dated 17.08.2000, granting decree

for specific performance of contract in the counter claim in Regular Civil

Suit No.228/1991 together with judgment and decree dated 05.07.2004

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in Regular Civil Appeal No.1/2001 confirming the judgment and decree

passed by trial Court are hereby quashed and set aside.

The appellant-plaintiff is hereby directed to refund an

amount of Rs.10,000/- to the respondent-defendant along with interest

at the rate of 6% per annum from 10.05.1989 within six months from

today. No order as to costs.

JUDGE

kahale