Bombay High Court
Gulam Ali Ismail Khan vs Shaikh Kalimulla Sk. Barkatulla And ... on 26 August, 2024
Author: R. G. Avachat
Bench: R. G. Avachat
2024:BHC-AUG:19612-DB
1 FA1180/2014
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD.
FIRST APPEAL NO.1180 OF 2014
1. Gulam Ali S/o Ismail Khan, }
Age: 60 Years, Occu: Business, } ..Appellants
Resident of Nawaz Manzil, Koliwada, } (Orig. Plaintiff)
Kalyan, District Thane }
Died Through his Legal Representatives }
(As per order dated 28th June, 2018 in }
Civil Application No.8099/2018 }
1-A) Saida Gulam Ali S/o Ismail Khan, }
Age: 63 Years, Occu: Housewife, }
1-B) Mansoor Ali Gulam Ali Khan, }
Age: 44 Years, Occu: Business, }
1-C) Samir Ali Gulam Ali Khan, }
Age: 42 Years, Occu: Business, }
1-D) Jamir Ali Gulam Ali Khan, }
Age: 40 Years, Occu: Business, }
1-A to 1-D All R/o: H. No. 126, }
Mansur Manjil, Station Road, }
Near Yamuna Sadan Kothi, }
Ahmednagar - 414 001 }
Maharashtra }
1-E) Jayada Firoj Pathan, }
Age: 47 Years, Occu: Household, }
R/o: Nagar Road, Isampura Chauk, }
Taluka: Rahata, Kolhar Bk., }
Ahmednagar - 413 371 }
Maharashtra. }
1-F) Tarannum Rafique Ahmed Shaikh, }
Age: 37 Years, Occu: Household, }
R/o: A-3, Nawaz Building, }
Ground Floor, Govindwadi Road, }
Behind Old Boys English School, }
Kalyan West - 421 301. }
2 FA1180/2014
Versus
1. Shaikh Kalimulla S/o Sk. Barkatulla, } ..Respondents
Age: 54 Years, Occu: Service, } (Orig. Respondents)
R/o: Bungalow No. 23, Cantonment, }
Aurangabad and also residing at }
United States of America. }
2. Shaikh Kalilulla S/o Sk. Barkatulla, }
Age: 51 Years, Occup: Business, }
R/o: As above. }
3. Shaikh Majidulla S/o Sk. Barkatulla, }
Age: 47 Years, Occup: Business, }
R/o: As above. }
......
Mr. A. D. Soman, Advocate for the Appellants,
Mr. P. R. Katneshwarkar, Advocate for Respondent No.1,
Mr. Rajendra S. Deshmukh, Senior Advocate a/w. Mr. Shriram
Deshmukh, Advocate i/by. Mr. Devang R. Deshmukh, Advocate for
Respondent No.2,
Mr. S. V. Adwant, Advocate for Respondent No.3.
......
WITH
CIVIL APPLICATION NO.1244 OF 2024
IN
FIRST APPEAL NO.1180 OF 2014
WITH
CIVIL APPLICATION NO.5366 OF 2014
IN
FIRST APPEAL NO.1180 OF 2014
......
CORAM : R. G. AVACHAT AND
NEERAJ P. DHOTE, JJ.
RESERVED ON : 18.07.2024
PRONOUNCED ON : 26.08.2024
JUDGMENT [ PER NEERAJ P. DHOTE, J. ] :
. This is the First Appeal under Section 96 of the Code of
Civil Procedure, 1908 (for short, 'C.P.C.') against the Judgment and
3 FA1180/2014
Order dated 21.11.2013 passed by the learned 2 nd Jt. Civil Judge, (S.D.),
Aurangabad dismissing the Spl. Civil Suit No.390/2011 instituted for
Specific Performance of Contract. The operative Order of the impugned
Judgment reads as under :
". The suit of the plaintiff is hereby dismissed.
1] The prayer for specific performance of the contract is
hereby rejected.
2] The prayer to refund earnest amount is hereby rejected.
3] The prayer for compensation is also hereby rejected.
4] Decree be drawn up accordingly."
2. The facts, in brief, giving rise to the present Appeal are as
follows:
2.1. The Appellants are the Legal Representatives of the original
Plaintiff who died during the pendency of the Appeal. The original
Plaintiff went before the learned Civil Court with the Plaint that he
entered into an Agreement to Sell (Exh.65) with the Defendants on
20.02.2008 in respect of landed property admeasuring 70,000 Sq. Feet,
bearing CTS No.20719, out of Survey No.2, situated at Kokanwadi,
Aurangabad (hereinafter referred to as the 'Suit Property') for the total
consideration of Rs.21,52,50,000/- (Twenty One Crore Fifty Two Lakh
Fifty Thousand Only) at the rate of Rs.3,075/- (Rs.Three Thousand
Seventy Five Only) per Sq. Feet. It was decided to execute the sale-deed
within a period of 6 (six) months from the date of agreement. Time
4 FA1180/2014
was essence of the contract. An amount of Rs.50,00,000/- was paid as
the earnest money by the Plaintiff to the Defendants.
2.2. On 18.03.2008, the Plaintiff came across the notice
published in the daily newspaper that, Defendant No.2 had already
executed an Agreement to Sell with the third party in respect of the Suit
Property. The Plaintiff contacted the Defendant Nos.2 and 3, who
assured that the issue would be settled and they will execute the
sale-deed with the Plaintiff. Though, the Plaintiff repeatedly contacted
the Defendants for execution of the sale-deed by accepting balance
consideration, the Defendants assured that they will execute the sale-
deed. By communication dated 26.06.2008 the Plaintiff requested the
Defendants to execute the sale-deed in his favour as early as possible
and the Defendants requested him to wait for some time. The Defendant
No.3 by a reply dated 26.06.2008 showed his readiness to perform his
part of contract. Even after the repeated requests by the Plaintiff, the
Defendants did not execute the sale-deed. On 20.08.2008 the Plaintiff
contacted the Defendants and requested them to complete the
transaction before expiry of the stipulated period and the Defendants
assured the Plaintiff to complete the transaction on 20.08.2008,
however when the Plaintiff went to the office of Sub-Registrar to
complete the necessary formalities, the Defendants did not turn up.
Therefore, the Plaintiff went to the house of the Defendant No.2. The
5 FA1180/2014
Plaintiff handed over one communication titled as 'Samaj Patra'
intimating that he was ready and willing to complete the transaction
and he was present for the same on 20.08.2008.
2.3. On 23.10.2008 the Plaintiff came across a notice published
in the newspaper issued by Defendant No.2 stating that the Plaintiff
failed to perform his part of contract within the stipulated period, to
which the Plaintiff replied by a paper publication on 29.11.2008 stating
that he was ready and willing to execute the sale-deed. The Defendant
Nos.2 and 3 sought some time from the Plaintiff to execute the sale-
deed. On 31.01.2009 the Plaintiff issued legal notice to the Defendants
through his Advocate requesting them to execute the sale-deed. Again
on 24.01.2011 the Plaintiff issued legal notice through his Advocate to
complete the sale transaction. The Defendant Nos.1 and 2 by their
respective replies dated 04.02.2011 denied their liability to perform the
contract. Eventually, the Plaintiff instituted the aforementioned suit.
3. Respondents are the Original Defendants. They filed their
respective written-statements.
3.1. The Defendant No.1 filed his Written-statement at Exh.32
stating that the Plaintiff failed and neglected to complete the sale
transaction within the stipulated period and therefore, he cannot claim
specific performance of contract and the earnest money stands forfeited.
6 FA1180/2014
He further stated that the Plaintiff was not ready and willing to perform
his part of contract and was not having the financial capacity to
complete the sale transaction within the stipulated period. He prayed for
dismissal of the suit with costs.
3.2. The Defendant No.2 by his Written-statement at Exh.14
opposed the suit stating that the time was essence of contract which was
to be competed within a period of 6 (six) months from the date of
agreement and the Plaintiff failed to execute the sale-deed within the
stipulated period, therefore, the earnest money was agreed to be
forfeited. He stated that the Agreement to Sell (Exh.65) was cancelled.
He further stated that the Plaintiff was fictitious person put forth by
Defendant No.3 and his brother-in-law with a view to grab the Suit
Property. After the Agreement to Sell (Exh.65), the Plaintiff never
contacted the Defendant No.2 for completion of the sale transaction.
Though he tried to contact the Plaintiff, he was not found on the given
address and therefore, he was unable to complete the sale transaction.
Therefore, he executed another agreement with third person and prayed
for dismissal of the suit with costs.
3.3. The Defendant No.3 filed his Written-statement at Exh.18
and supported the case of Plaintiff.
7 FA1180/2014
4. The learned Civil Court, on the basis of rival pleadings of
the parties, framed the issues and findings on that at Exh.57 which reads
thus:
"ISSUES FINDINGS
1. Whether Defendant Nos.1 to 3 executed In affirmative
agreement to sale of the suit property on
20.02.2008 in favour of the plaintiff?
2. Whether the plaintiff on 20.02.2008 paid an In affirmative
amount of Rs.50,00,000/- to defendants as
an earnest amount?
3. Whether the plaintiff was / is ready and In negative
willing to perform his part of contract?
4. Whether the time was essence of the In affirmative
contract?
5. Whether the defendants have committed In negative
breach of contract?
6. Is the plaintiff entitled to get relief of specific In negative
performance of contract as prayed for ?
Or in the alternative
Is the plaintiff entitled to get refund of
earnest amount of Rs.50,00,000/- with
interest as prayed for?
7. Is the plaintiff entitled to get compensation In negative
as prayed for ?
8. What order and decree? Suit is dismissed"
5. The Plaintiff examined his General Power of Attorney (GPA)
namely Syed Gulam Rasul Yasin as PW1, who filed his evidence affidavit
at Exh.59. He was subjected to cross-examination by the Defendant
8 FA1180/2014
No.1. The Defendant No.2 adopted the cross-examination of Defendant
No.1. The Defendant No.3 declined to cross-examine.
6. The Plaintiff examined another witness namely Mirza
Parvez Ali Baig as PW2, who filed his evidence affidavit at Exh.88. He
was cross-examined by Defendant No.1 which was adopted by
Defendant No.2. Defendant No.3 did not cross-examine.
7. Defendant No.3 namely Shaikh Majidullah Shaikh
Barkatullah filed his evidence affidavit at Exh.116 as DW1. He was
cross-examined by Defendant Nos.1 and 2.
8. The Defendant No.2 - Sk. Khalilullah Sk. Barkatullah filed
his evidence affidavit at Exh.150 as DW2. He was cross-examined by
Defendant No.3 and the Plaintiff.
9. The following documents are brought on record in the
evidence led by the parties :-
(a) Agreement for Sell at Exh.65
(b) Samaj Patra at Exh.66
(c) Legal notice sent by the Plaintiff to the Defendants - Exh.67
(d) The Postal Acknowledgment of the above notice - Exh.68
(e) Legal Notice sent by the Plaintiff to the Defendants - Exh.69
(f) The U.P.C. for the said notice Exhs.70 to 75
(g) Reply notice by Defendant No.1 to the Plaintiff - Exh.79
(h) Reply notice by Defendant No.2 to the Plaintiff - Exh.80
(i) The Paper publication - Article "B".
9 FA1180/2014
(j) Compromise Petition / Terms in Spl. Civil Suit No.293/2006 at
Exh.126.
(k) Receipt issued by the Sub-Registrar towards registration fee and
Agreement for Development at Exh.156.
10. Considering the evidence brought on record by the parties,
the learned Civil Court passed the impugned Judgment and Order.
11. Heard learned Advocate for the Appellants, learned
Advocate for Respondent No.1, learned Senior Advocate for Respondent
No.2 and learned Advocate for Respondent No.3. As all the submissions
revolved around Point No.3, the submissions are taken while discussing
the said point. Scrutinized the evidence available on record. The Parties
are referred as per their status / nomenclature before the learned Civil
Court. Following points arise for our determination:
POINTS FINDINGS
1. Whether the Defendants entered into an In the Affirmative
Agreement to Sell with the Plaintiff on
20.02.2008 in respect of the Suit
Property?
2. Whether the Plaintiff paid In the Affirmative
Rs.50,00,000/- (Rs. Fifty Lakh) as the
earnest money to the Defendants?
3. Whether the Plaintiff was ready and In the Negative
willing to perform his part of contract?
4. Whether time was the essence of the In the Affirmative
contract?
10 FA1180/2014
5. Whether the Plaintiff is entitled for In the Negative
decree on admission by defendant No.3
to the extent of 1/3rd undivided share
In the Suit Property?
6. Whether the Plaintiff is entitled for To the extent of
alternate prayer ? refund of earnest
money with Interest.
7. What Order? First Appeal is partly
allowed.
:: REASONS ::
AS TO POINT NOS.1 AND 2 :
12. The Plaintiff in his plaint and in evidence affidavit GPA /
PW1 - Syed Gulam Rasul Yasin stated and averred that the Defendants
had executed the Agreement to Sell (Exh.65) in respect of the land
admeasuring 70000 Sq. Ft. bearing CTS No.20719, Survey No.2 situated
at Kokanwadi, Aurangabad.
13. Defendant No.1, though pleaded in his Written-statement
that no Agreement to Sell of any property was entered with the Plaintiff,
he has averred that Defendant No.3 was managing the entire property of
their father and even after the demise of their father Defendant No.3
continued to manage the entire property as he and Defendant No.2
were abroad. He was entirely dependent on Defendant No.3
in respect of the affairs and the management of the properties.
When he had come to India in 2008, the Defendant No.3 came
to him and asked him to sign on an agreement which he was made
11 FA1180/2014
to believe that it was in respect of the disputes with Defendant No.2 and
believing him he put his signatures above the signatures of Defendant
Nos.2 and 3. However, no evidence is led by Defendant No.1. Though
Defendant No.1 cross-examined the witnesses examined by the Plaintiff,
however nothing has come in the cross-examination to establish that
Defendant No.1 did not enter into the said agreement with the Plaintiff.
On the contrary, the tenor of cross-examination show that the said
agreement was executed after the talks had taken place between all the
three Defendants.
14. Defendant No.2 by his Written-Statement admitted the
execution of the said agreement with the Plaintiff. In his evidence
affidavit, he averred about the said Agreement to Sell (Exh.65) with the
Plaintiff. In his cross-examination it has come that on 20.02.2008 they
all three brothers i.e. Defendants No.1 to 3, went separately to the
Advocate for signing the agreement where the Defendant No.1,
thereafter he and thereafter Defendant No.3 had signed the agreement
which was read over by the Advocate to all who were present there.
15. Defendant No.3 in his Written-statement admitted the
execution of the said agreement. He admitted the case of Plaintiff. He
did not cross-examine the Plaintiff.
16. In view of the above discussion, the Plaintiff has proved that
Defendants No.1 to 3 executed the Agreement to Sell (Exh.65) in
12 FA1180/2014
respect of the above referred Suit Property with him on 20.02.2008 and
hence Point No.1 is answered 'in the Affirmative'.
17. As per the avernments in the plaint and the evidence
affidavit of the GPA of the Plaintiff, he paid Rs.50,00,000/- as the
earnest money to the Defendants jointly on 20.02.2008.
18. PW2 - Mirza Parvez Ali Baig examined by the Plaintiff in his
evidence deposed that he was the brother-in-law of all the Defendants.
His evidence show that as per the terms and conditions in the
Agreement, Rs.50,00,000/- which was brought by the Plaintiff was
handed over to Defendants No.1 to 3 jointly and thereafter Defendants
No.1 to 3 signed on every page of the Agreement before him and he and
another witness signed as the witnesses. The cross-examination of this
witness done by the Defendants No.1 and 2 could not create any dent in
his evidence led in support of the Plaintiff. In the cross-examination
it has come that the amount of earnest money was distributed to all the
Defendants equally in cash. It has come in his cross-examination that he
has good relations with Defendants No. 1 and 2.
19. Learned Advocates for the parties submitted that there is no
dispute in respect of the Point Nos. 1 and 2 and the findings recorded by
the learned Trial Court on the said points. In view of the above, the
Point No.2 is answered 'in the Affirmative'.
13 FA1180/2014
AS TO POINT NO.3 :
20. It is submitted by learned Advocate for the Plaintiffs that,
the learned Trial Court has not considered certain admitted facts that
the Defendant No.2 had entered into an Development Agreement with
the third parties prior to the Agreement entered between the Plaintiff
and the Defendants. The learned Trial Court has not considered the
communications between the Plaintiff and the Defendant No.3. He
further submitted that in the Civil Suit filed by the third parties
regarding the Development Agreement, the learned Civil Court had
issued the Temporary Injunction by which the Defendants No.1 to 3
were restrained from creating any third party interest in the Suit
Property. The Plaintiff in his pleadings and the evidence categorically
stated and proved that he was ready and willing to perform his part of
contract and was having capacity to deposit the entire amount. Though
the Plaintiff was present before the Office of the concerned
Sub-Registrar for executing the sale-deed on 20.08.2008, the Defendants
failed to come before the said authority and execute the sale-deed. The
Plaintiff approached the Defendants No.2 and 3 on the given address
informing them his readiness and willingness to perform his part of
contract and requested them to complete the said transaction vide
issuing the 'Samaj Patra'. The Plaintiff also contacted the Defendant
No.1 via internet calling who was in the United States of America at the
relevant time. He further submitted that, despite the subsistence of the
14 FA1180/2014
Agreement to Sell (Exh.65) between the parties, Defendant No.2
entered into another Development Agreement with the third party on
02.09.2008. As the Defendants were not performing their part of
Agreement, the Plaintiff issued legal notice to them requesting to
execute the sale-deed. The Defendants never tried to return the earnest
money which they had accepted at the time of the Agreement. The
Plaintiff was not required to deposit the entire amount in the Court as
per Section 16 of the Specific Relief Act, 1963. The Power of Attorney
Holder of the Plaintiff / PW1 - Syed Gulam Rasul Yasin had complete
knowledge of the Agreement to Sell (Exh.65) and about the transaction
between the Plaintiff and the Defendants in respect of the Suit Property
and so, he deposed on behalf of the Plaintiff. Learned Trial Court did
not consider the above aspects and the findings recorded against the
issue Nos. 3, 5, 6 and 7 'in Negative' was contrary to the evidence on
record. In support of his submissions, he cited the following Judgments
of the Hon'ble Supreme Court of India :
1. Nadiminti Suryanarayan Murthy (Dead) Through Legal
Representatives vs. Kothurthi Krishna Bhaskara Rao and
Others, (2017) 9 SCC 622
2. Zarina Siddiqui vs. A. Ramalingam Alias R. Amarnathan,
(2015) 1 SCC 705
3. P. Daivasigamani vs. S. Sambandan, (2022) 14 SCC 793
4. Gaddipati Divija and Another vs. Pathuri Samrajyam and
Others, 2023 SCC OnLine SC 442
15 FA1180/2014
5. Basavaraj vs. Padmavathi and Another, (2023) 4 SCC
239
21. It is submitted by learned Advocate for the Defendant No.1
and learned Senior Advocate for Defendant No.2 that the evidence on
record show that the Plaintiff failed to prove that he was ready and
willing to perform his part of contract. Time was the essence of
contract. The period of six (6) months was given in the agreement to
complete the transactions as, the Suit Property was in a good locality
and there was increase in the price day by day. The communication
dated 26.06.2008 which according to the Plaintiff was sent to the
Defendants, was in fact never served on the Defendants No.1 and 2.
The Defendant No.3 was in collusion with the Plaintiff. Though the suit
was filed within the period of limitation, the Plaintiff did nothing for a
period of more than 2 years and filed the suit when the expiry of
limitation was nearing. The Power of Attorney Holder of the Plaintiff
namely Syed Gulam Rasul Yasin who was examined by the Plaintiff as
the PW1 was neither named in the Agreement nor in the plaint. The
said Power of Attorney Holder did not disclose in his affidavit that he
was intending to purchase the Suit Property and was covered by the
terms mentioned in the Agreement. The pleadings of the Plaintiff and
the averments in the evidence affidavit of PW1 - Syed Gulam Rasul
Yasin were vague. Some of the contents of the evidence affidavit
of the GPA / PW1 - Syed Gulam Rasul Yasin were not the part of
pleadings in the plaint. They further submitted that, the evidence of
16 FA1180/2014
General Power of Attorney Holder / PW1 - Syed Gulam Rasul Yasin
nowhere show that he was present with the Plaintiff in the Sub-Registrar
office. If at all the Plaintiff was not able to give his evidence in the suit,
his evidence could have been recorded by way of commission as
provided under the Code of Civil Procedure. The credentials of the
GPA / PW1 - Syed Gulam Rasul Yasin were doubtful. The 'Samaj Patra'
which was never served on the Defendants No. 1 and 2 nowhere states
that the Plaintiff had come with money and the stamp papers and draft
sale-deed to the office of Sub-Registrar. In the normal course, a prudent
man would have intimated the parties one or two days before
completing the transaction. The said 'Samaj Patra' is created evidence.
The relief prayed by the Plaintiff in the Appeal for execution of sale-deed
was an equitable relief and the evidence available on record show that
he was not entitled for the relief as prayed for and the Appeal be
dismissed. In support of his contention, he relied on the following
Judgments of the Hon'ble Supreme Court of India:
1. Man Kaur (Dead) By LRs vs. Hartar Singh Sangha,
(2010) 10 SCC 512
2. B. K. Sri Harsha (Dead) By LR and Another, (2008) 4
SCC 48
3. Chand Rani (Smt) (Dead) by LRs vs. Kamal Rani (Smt)
(Dead) by LRs, (1993) 1 SCC 519
4. Acharya Swami Ganesh Dassji vs. Sita Ram Thapar,
(1996) 4 SCC 526
5. Azhar Sultana vs. B. Rajamani and Others, (2009) 17
SCC 27
6. S. Kesari Hanuman Goud vs. Anjum Jehan and Others,
(2013) 12 SCC 64
17 FA1180/2014
22. Learned Advocate for the Defendants No.3 submits that the
Defendant No.3 was ready and still ready to execute his part of contract
in favour of the Plaintiff to the extent of his undivided share in the Suit
Property. He submits that the Defendants No.1 and 2 have not come
with the clean hands. The Defendant No.1 though filed Written-
statement, did not enter the witness box. There was dearth of action on
the part of Defendants No.1 and 2 in performing their part of contract.
The Plaintiff had discharged his burden by examining his GPA / PW1 -
Syed Gulam Rasul Yasin. No credence can be given to the dishonest
party. The Plaintiff was entitled for decree of Specific performance and
the Appeal be allowed. In support of his submissions, he relied on the
following Judgments:
(a) Dalip Singh vs. State of Uttar Pradesh and Others,
(2010) 2 SCC 114
(b) Vidhyadhar vs. Manikrao and Another, (1999) 3 SCC
573
(c) Kaushik Premkumar Mishra and Anr vs. Kanji
Ravaria@ Kanji & Anr by Hon'ble Supreme Court of
India in Civil Appeal No.1573 of 2023 decided on
April 19, 2024.
23. On perusal of the above referred Judgments relied upon by
the parties, the following Legal Principles emerges:
"(a) The remedy for specific performance is an equitable
remedy. The Court while granting decree of specific
performance exercises its discretionary jurisdiction.
18 FA1180/2014
Discretion must be exercised in accordance with
sound and reasonable judicial principles.
(b) The discretion to direct specific performance of an
agreement and that too after elapse of a long period
of time, undoubtedly, has to be exercised on sound,
reasonable, rational and acceptable principles. The
parameters for the exercise of discretion vested by
Section 20 of the Specific Relief Act, 1963 cannot be
entrapped within any precise expression of language
and the contours thereof will always depend on the
facts and circumstances of each case. The ultimate
guiding test would be the principles of fairness and
reasonableness as may be dictated by the peculiar
facts of any given case, which features the
experienced judicial mind can perceive without any
real difficulty.
(c) While balancing the equities, one of the
considerations to be kept in view is as to who is the
defaulting party.
(d) Where the plaintiff brings a suit for specific
performance of contract for sale, the law insists a
condition precedent to the grant of decree for specific
performance that the plaintiff must show his
continued readiness and willingness to perform his
part of the contract in accordance with its terms from
the date of contract to the date of hearing.
(e) Subsequent rise in price will not be treated as a
hardship entailing refusal of the decree for specific
19 FA1180/2014
performance. Rise in price is a normal change of
circumstances and, therefore, on that ground a decree
for specific performance cannot be reversed.
(f) The equitable discretion to grant or not to grant a
relief for specific performance also depends upon the
conduct of the parties. The necessary ingredient has to
be proved and established by the plaintiff so that
discretion would be exercised judiciously in favour of
the plaintiff. At the same time, if the defendant does
not come with clean hands and suppresses material
facts and evidence and misled the Court then such
discretion should not be exercised by refusing to grant
specific performance.
(g) The Specific Performance of the Contract, may in the
discretion of the court, be enforced, when the act
agreed to be done, was such that compensation in
money for its non-performance would not afford
adequate relief, and that the breach of a contract to
transfer immovable property could not be adequately
relieved by compensation in money. It also emerges
that specific performance of a contract could not be
enforced in favour of a person, who failed to aver and
prove that he had performed or had always been
ready and willing to perform the essential terms of the
contract, which were to be performed by him. It could
also not be enforced in favour of a person who failed
to aver in the plaint the performance of, or readiness
and willingness to perform the contract according to
its true construction.
20 FA1180/2014
(h) Readiness and willingness are not one, but two
separate elements. Readiness means the capacity of
the plaintiff to perform the contract, which would
include the financial position to pay the purchase
price. Willingness refers to the intention of the
plaintiff as a purchaser to perform his part of the
contract. Willingness is inferred by scrutinizing the
conduct of the plaintiff/purchaser, including attending
circumstances. Continuous readiness and willingness
on the part of the plaintiff/purchaser from the date
the balance sale consideration was payable in terms of
the agreement to sell, till the decision of the suit, is a
condition precedent for grant of relief of specific
performance.
(i) Time is not the essence of the contract in the case of
immovable properties, unless there are grounds to
hold to the contrary.
(j) That the 2018 amendment was not a mere procedural
enactment, but it had substantive principles built into
its working, and as such, the said amendment was
perspective in nature and cannot apply to those
transactions which took place prior to its enforcement.
(k) An attorney-holder who has signed the plaint and
instituted the suit, but has no personal knowledge of
the transaction can only give formal evidence about
the validity of the power of attorney and the filing of
(l) If the attorney-holder has done any act or handled any
transactions, in pursuance of the power of attorney
21 FA1180/2014
granted by the principal, he may be examined as a
witness to prove those acts or transactions. If the
attorney-holder alone has personal knowledge of such
acts and transactions and not the principal, the
attorney-holder shall be examined, if those acts and
transactions have to be proved.
(m) The attorney-holder cannot depose or give evidence in
place of his principal for the acts done by the principal
or transactions or dealings of the principal, of which
principal alone has personal knowledge.
(n) Where the principal at no point of time had personally
handled or dealt with or participated in the
transaction and has no personal knowledge of the
transaction, and where the entire transaction has been
handled by an attorney-holder, necessarily the
attorney-holder alone can give evidence in
regard to the transaction. This frequently happens in
case of principals carrying on business through
authorized managers/attorney-holders or persons
residing abroad managing their affairs through their
attorney-holders.
(o) Where the entire transaction has been conducted
through a particular attorney-holder, the principal has
to examine that attorney-holder to prove the
transaction, and not a different or subsequent
attorney-holder.
(p) Where different attorney-holders had dealt with the
matter at different stages of the transaction, if
evidence has to be led as to what transpired at those
22 FA1180/2014
different stages, all the attorney-holders will have to
be examined.
(q) Where the law requires or contemplates the plaintiff
or other party to a proceeding, to establish or prove
something with reference to his 'state of mind' or
'conduct', normally the person concerned alone has to
give evidence and not an attorney-holder.
(r) The discretion to decree specific performance should
be exercised by the court and in some cases, whether
the suit was barred by limitation and even if not,
whether the plaintiff has been guilty of negligence or
laches disentitling him to a decree for specific
performance. These questions, by and large, may not
be questions of law of general importance. But they
cannot also be considered to be pure questions of fact
based on an appreciation of the evidence in the case.
They are questions which have to be adjudicated
upon, in the context of the relevant provisions of the
Specific Relief Act and the Limitation Act (if the
question of limitation is involved).
(s) There is distinction between 'readiness' to perform the
contract and 'willingness' to perform the contract. By
readiness may be meant the capacity of the Plaintiff to
perform the contract which includes his financial
position to pay the purchase price. For determining
his willingness to perform his part of contract, the
conduct has to be properly scrutinized.
(t) The factor of readiness and willingness to perform
Plaintiff's part of the contract is to be adjudged with
23 FA1180/2014
reference to the conduct of the party and attending
circumstances.
(u) It is a settled legal proposition that the power-of
-attorney-holder cannot depose in place of the
principal. Provisions of Order III, Rules 1 and 2 CPC
empower the holder of the power of attorney to "act"
on behalf of the principal. The word "acts" employed
therein is confined only to "acts" done by the power-
of-attorney holder, in exercise of the power granted to
him by virtue of the instrument. The term "acts",
would not include deposing in place and instead of
the principal. In other words, if the power-of-attorney
holder has preferred any "acts" in pursuance of the
power of attorney, he may depose for the principal in
respect of such acts, but he cannot depose for the
principal for acts done by the principal, and not by
him. Similarly, he cannot depose for the principal in
respect of a matter, as regards which, only the
principal can have personal knowledge and in respect
of which, the principal is entitled (sic liable) to be
cross-examined.
(v) The continuous readiness and willingness on the part
of the plaintiff is a condition precedent to grant the
relief of specific performance. This circumstance is
material and relevant and is required to be
considered by the court while granting or refusing to
grant the relief. If the plaintiff fails to either aver or
prove the same, he must fail. To adjudge whether the
plaintiff is ready and willing to perform his part of the
contract, the court must take into consideration the
24 FA1180/2014
conduct of the plaintiff prior and subsequent to the
filing of the suit alongwith other attending
circumstances. The amount of consideration which he
has to pay to the defendant must of necessity be
proved to be available. Right from the date of the
execution till date of the decree he must prove that he
is ready and has always been willing to perform his
part of the contract. As stated, the factum of his
readiness and willingness to perform his part of the
contract is to be adjudged with reference to the
conduct of the party and the attending circumstances.
The court may infer from the facts and circumstances
whether the plaintiff was ready and was always ready
and willing to perform his part of contract."
(w) The contract, being a creature of an agreement
between two or more parties, is to be interpreted
giving the actual meaning to the words contained in
the contract and it is not permissible for the court to
make a new contract, however, if the parties have not
made it themselves.
(x) The Court cannot rewrite or create a new contract
between the parties and has to simply apply the terms
and conditions of the agreement as agreed between
the parties.
(y) The explicit terms of the contract are always the final
word with regard to the intention of the parties.
(z) The litigant, who attempts to pollute the stream of
justice or who touches the pure fountain of justice
25 FA1180/2014
with tainted hands, is not entitled to any relief,
interim or final.
(z1) Where a party to a suit does not appear in the witness
box and states his own case on oath and does not
offer himself to be cross-examined by the other side, a
presumption would arise that the case set up by him is
not correct."
24. Admittedly, in the case on hand the agreement was dated
20.02.2008, the suit was filed in August-2011, the impugned
Judgment and Order was passed in November - 2013. The
transactions between the parties was undisputedly before the Specific
Relief (Amendment) Act, 2018. The matter therefore would be
governed by the provisions of the Specific Relief Act, 1963 which stood
on the date of agreement. Section 16 of the Act as it stood at the
relevant time i.e. before the amendment of 2018 is as follows:
"16. Personal bars to relief.-- Specific performance of a contract
cannot be enforced in favour of a person -
[(a) who has obtained substituted performance of contract
under section 20; or]
(b) who has become incapable of performing, or violates any
essential term of, the contract that on his part remains to be
performed, or acts in fraud of the contract, or willfully acts at
variance with, or in subversion of, the relation intended to be
established by the contract; or
(c) [who fails to 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, other than terms the
performance of which has been prevented or waived by the
defendant.
Explanation.--For the purposes of clause (c),--
26 FA1180/2014
(i) where a contract involves the payment of money, it is not
essential for the plaintiff to actually tender to the defendant or
to deposit in Court any money except when so directed by the
Court;
(ii) the plaintiff [must prove] performance of, or readiness
and willingness to perform, the contract according to its true
construction."
25. The terms and conditions of the Agreement to Sell (Exh.65)
entered between the Plaintiff and the Defendants are reproduced below
for better understanding of the matter.
"1. The Purchasers have agreed to purchase and the Vendors
have agreed to sell the property which is comprised in pink
colour in the map annexed to this agreement, which forms a part
and parcel of this deed, for a consideration of Rs.21,52,50,000/-
subject to the area affected under road widening and the area
available for sale.
2. The Purchasers have paid an amount of Rs.50,00,000/- in
cash to the Vendors, which the Vendors do hereby acknowledge
to have received, towards earnest money, hence no separate
receipt is necessary to be passed in the names of the Purchasers.
3. The Purchasers have agreed and accepted to pay the
remaining amount of consideration after determining the final
amount of consideration upon calculating the area available for
sale, as a part thereof is likely to be affected in road widening.
4. The Purchasers have agreed to perform their part of the
contract within 6 months of the date of these presents and will
not postpone the performance on any guise or pretext, beyond
the time granted, time being the essence of the contract.
5. The Vendors hereby agree that upon the acceptance of the
total amount of the consideration as agreed upon, the Vendors
will execute the Sale Deed in favour of the Purchasers and / or
anyone in whose favour, the Purchasers may direct them to
execute the sale deed and will also part with the vacant and
peaceful possession of the property under sale to the Purchasers
and / or anyone as they may direct, free from all encumbrances
and will divest their right, title, interest, ownership and
possession of the said property to such Purchaser/s.
6. That the Vendors shall deliver to the Purchasers all the
title deeds and documents in their power, possession and control
27 FA1180/2014
and relating to the said immovable property at the time of the
execution of the Sale Deed in favour of the Purchasers.
7. The Vendors will discharge and pay all the taxes,
outgoings and liabilities in respect of the property under sale till
the date of sale and will give the receipts thereof to the
Purchaser before the execution of the Deed of Sale.
8. The Vendors hereby assure the Purchasers that no notice
from the Government or any Statutory Body, local authority
under the provisions of any law for the time being in force, has
been received by them or served upon them, in respect of the
property under sale.
9. That as agreed by the parties, Time will be essence of
Contract and both the parties will be under obligation to
discharge their respective duties stipulated herein and that if the
sale is not completed within the stipulated time, the Vendors will
have a right to forfeit the amount of the earnest money paid by
the Purchasers and rescind the contract and will be free to sell
the property under sale to any other party and in such an event,
the Purchasers will have no right and/or cause to take up the
claim with the court of law.
10. It is further agreed by the Purchasers that all the enquiries
relating to the property under sale expected to be acquired for
road widening will completed by them within the time of the
contract and will also perform their part of paying the remaining
amount of consideration to the Vendors within the said time.
The Purchasers will also have a right to give a paper publication,
calling upon the objections, if any from the interested parties,
before completing the sale.
11. The Vendors assure that upon the payment of the
remaining amount of consideration by the Purchasers, they will
be liable to perform their part of the contract by executing a
registered sale deed in favour of the Purchaser, without
postponing it on any count and by taking a registered power of
attorney of Vendor No.1, who is residing in USA, if need be.
12. The stamp duty and registration charges for the purpose
of registration of the sale deed and the out of pocket expenses
shall be borne by the Purchasers."
26. Admittedly, the Plaintiff did not enter the witness box. On
his behalf his GPA / PW1 - Syed Gulam Rasul Yasin adduced the
evidence by filing the evidence affidavit at Exh.59. From his cross-
28 FA1180/2014
examination, it is clear that the Plaintiff was present in the Court at the
time of his evidence. Though the evidence of GPA/PW1 - Syed Gulam
Rasul Yasin show that the Plaintiff had undergone bypass surgery in
2010, his evidence show that the Plaintiff travelled in the car to the
Court. No reason is forthcoming from the evidence on record as to what
made the Plaintiff not to enter the witness box. It is further clear from
evidence of GPA / PW1 - Syed Gulam Rasul Yasin that the General
Power of Attorney was executed during pendency of the suit.
Admittedly, he was not the signatory to the agreement.
27. The evidence of GPA / PW1 - Syed Gulam Rasul Yasin
show that he was not aware about the financial capacity of the Plaintiff.
He showed his ignorance about the monthly income of the Plaintiff and
went on to say that the Plaintiff himself can say about his monthly
income. He further showed his ignorance about the credit balance in the
bank account of the Plaintiff. Though it has come in his evidence that
the Plaintiff had kept some amount in the Fixed Deposit, he was not
aware of the extent of amount which was kept in the Fixed Deposit.
His cross-examination further go to indicate that they were not
possessing the balance amount which was Rs.21,00,00,000/- readily
with them as he deposed that they can deposit the said amount in the
Court within a span of one (1) or two (2) months.
29 FA1180/2014
28. In his cross-examination he accepted that as per the
agreement the Plaintiff was required to perform his part of contract
within six (6) months. He deposed that they had not paid the amount of
Rs.21,00,00,000/- to the Defendants within six (6) months. He was
unable to state whether since the date of the agreement till the date of
his deposition they were having the amount of Rs.21,00,00,000/- in
their bank accounts. He further was unable to depose whether during
the period of six (6) months they were having Rs.21,00,00,000/- in their
bank account.
29. Undisputedly, in the Written-statement the Defendant No.1
raised specific pleading calling the Plaintiff to show funds standing at his
credit by producing cogent documentary evidence. The evidence
available on record do not show that the Plaintiff met the said
avernment by bringing on record the required documents to show his
financial capacity.
30. The GPA / PW1 - Syed Gulam Rasul Yasin admitted in his
cross-examination that there was no mention in the General Power of
Attorney that he would appear in the suit whenever he would like to do
so. He did not remember whether there was talk between the parties
about the area and size of the disputed property. He was unable to state
the length or width or the other portion of the disputed property. With
reference to his evidence that they went to the Sub-Registrar's Office at
30 FA1180/2014
Aurangabad on 20.08.2008, it has come in his cross-examination that on
that day they were not prepared with stamp papers for registration of
the sale-deed and they were not having the draft sale-deed with them.
Though it has come that on that day they were having an amount of
Rs.21,00,00,000/- with them in cash which were brought from
Ahmednagar and Kalyan, he was unaware as to from whom the said
amount was collected and where the said amount had gone when the
sale-deed was not executed.
31. Further, his cross-examination show that, except the
transaction in question, they had not entered in any other transaction of
such huge amount of Rs.21 Crore. The previous transactions, which they
have dealt with were to the extent of Rs.2 to Rs.2.5 Crore. This also
throw light on the financial capacity of Plaintiff.
32. Though the document in the nature of 'Samaj Patra' is
brought in evidence at Exh.66, admittedly, the same was not served on
the Defendants No.1 and 2, for the obvious reason that Defendant No.1
was residing in the USA. Shri. Katneshwarkar, learned Advocate for the
Defendant No.1 has rightly submitted that the said document is
completely silent that the Plaintiff had come with the money on that day
i.e. 20.08.2008, to the office of Sub-Registrar to execute the sale-deed.
He further rightly submitted that there is nothing on record to show that
the Plaintiff had on previous occasion intimated the Defendants that he
was coming on that day for executing the sale-deed to the office of the
31 FA1180/2014
Sub-Registrar. It would be the natural conduct of the party who wants
to execute the sale-deed with such huge amount to inform the other side
well in advance. The avernment in the evidence affidavit of GPA / PW1
- Syed Gulam Rasul Yasin that as per the assurance given by the
Defendants, the Plaintiff went to the office of Sub-Registrar,
Aurangabad, is without any foundation and without any specification as
to when and in what manner the assurance was given by the
Defendants.
33. Though the Plaintiff pleaded and in the evidence the GPA /
PW1 - Syed Gulam Rasul Yasin deposed that the plaintiff asked the
Defendants to execute the sale-deed and was continuously pursuing the
matter with the Defendants, the same is vague. The pleadings and
evidence lacks specific dates on which the Plaintiff contacted and asked
the Defendants to execute the sale-deed. Though the Plaintiff has relied
on the communication dated 26.06.2008 whereby all the Defendants
were requested to execute the sale-deed before 20.08.2008, the said
document is not brought in evidence and not exhibited. Therefore,
strictly speaking it cannot be read. However, during the course of
argument, the learned Advocate for the Plaintiff heavily relied on it.
Undisputely, there is nothing to show that the same was served on
Defendants No.1 and 2. Learned Advocate for Defendant No.1 has
rightly submitted that when, from the pleadings of the Plaintiff and
evidence led by him, it was clear that Defendant No.1 was residing in
32 FA1180/2014
USA, why his place of residence was shown at Aurangabad. Service of
the said communication / letter on Defendant No.3 will not be service
on the Defendants No. 1 and 2.
34. Though the evidence of GPA / PW1 - Syed Gulam Rasul
Yasin show that he had sent the legal notices dated 31.01.2009 and
21.11.2009 to the Defendants through Advocate in respect of the subject
matter, undisputely the same are much after the expiry of six (6)
months period as mentioned in the Agreement to Sell (Exh.65). This
show complete lull on the part of the Plaintiff in pursuing the subject
matter. As regards first legal notice dated 31.01.2009, it is the Plaintiff's
own case that there was no positive record of service of the said notice
on Defendants No.1 and 2. Further, from the evidence on record it is
seen that after the Agreement to Sell (Exh.65) the Defendant No.1 went
to USA, however the postal receipts show that the notice at Exh.67
dated 31.01.2009 was dispatched at Aurangabad address.
35. In the plaint and in the evidence affidavit of GPA / PW1 -
Syed Gulam Rasul Yasin, it is pleaded and stated more than once that
after the execution of the Agreement to Sell (Exh.65), the Plaintiff
repeatedly, from time to time contacted the Defendants for execution of
the sale deed, however every time the Defendants assured the execution
of the sale-deed. The said pleadings are general in nature and vague.
33 FA1180/2014
There is complete absence of particulars / specifications as to when the
Plaintiff contacted the Defendants and by what mode. Such vague and
general pleadings and avernments in the affidavit without any
specification are not sufficient to establish willingness to perform the
part of the contract.
36. Learned Advocate for the Plaintiff further stressed on the
communication dated 26.06.2008 issued by the Defendant No.3 to the
Plaintiff. Undisputedly, the said communication is also not exhibited
and therefore not the part of the evidence. Learned Advocate for the
Defendants No.1 and 2 have rightly submitted that even if it is read in
evidence, the said communication by Defendant No.3 will not bind the
Defendants No.1 and 2.
37. Perusal of the pleadings in the plaint and the contents of
the evidence affidavit of the General Power of Attorney of the Plaintiff,
makes it clear that certain statements in the evidence affidavit were not
supported by the pleadings in the plaint. It is needless to state that no
evidence can be led in the absence of foundational pleadings.
38. The case of the Plaintiff that he was present in the Sub-
Registrar's Office on 20.08.2008 on the assurance given by the
Defendants falls down as it is the evidence of the GPA / PW1 - Syed
Gulam Rasul Yasin that, they were aware that Defendant No.1 was not
present at Aurangabad and it was not possible to get the sale-deed
34 FA1180/2014
executed and registered on that day. As regards Plaintiff's case of
telephonic talk with the Defendant No.1 at America, GPA / PW1 - Syed
Gulam Rasul Yasin in his evidence deposed that according to him
minimum charge for phone call to America from India was Rs.30 to 32
and the copy of receipt at Exh.86 show that Rs.2/- was paid towards
charges for the call to Defendant No.1 at America. If that is so, it is not
possible to accept the Plaintiff's contention that talk had taken place
between him and Defendant No.1 on the aforesaid date.
39. Even in the present Appeal, which is the continuation of the
civil suit and being the Appellate Court this Court is having the same
powers as are conferred by the Code of Civil Procedure on the Courts of
original jurisdiction in respect of the suits instituted therein, the learned
Advocate for the Plaintiff was unable to state as to within what time
the Plaintiff could arrange for the remaining consideration required to
execute the sale-deed. PW2 - Mirza Parvez Ali Baig examined by the
Plaintiff vide Exh.88, in no uncertain terms deposed that it was agreed
between the parties that the Plaintiff should pay total consideration
amount within 6 (six) months to the Defendants and on receiving the
consideration amount, the Defendants should execute the sale-deed in
favour of the Plaintiff. As per the Agreement to Sell (Exh.65) the
Plaintiff had agreed to perform his part of contract within six (6) months
and he was required to perform his part of obligation within the
stipulated period, one of which was that he was required to pay the
35 FA1180/2014
remaining amount of consideration to the Defendants within the
stipulated time. It is also clear from the cross-examination of the GPA /
PW1 - Syed Gulam Rasul Yasin that six (6) months time was fixed for
payment of remaining consideration.
40. From the above discussion, it is established that the Plaintiff
was neither ready nor willing to perform his part of contract. In view of
the above discussion, it is more than clear that the Plaintiff miserably
failed to establish his continued readiness and willingness to perform his
part of contract and therefore, Point No.3 is answered accordingly.
AS TO POINT NO.4 :
41. As seen from the above referred rulings of the Hon'ble
Supreme Court of India and the settled position under the law, time is
not the essence of the contract in the case of immovable properties,
unless there are grounds to hold to the contrary. In the case on hand, as
is clear from the pleadings and evidence on record the Suit Property is a
plot compromising area of 70000 Sq. Ft. situated in the Aurangabad
city. The GPA / PW1 - Syed Gulam Rasul Yasin in his cross-examination
accepted that the prices of landed property prevailing in the year 2008
had escalated. Even there is pleading in Written-statement of the
Defendant No.1 that the rates of the Suit Property had sky rocketed. It
is also clear that some of the portion of CTS No.20719 of which the Suit
36 FA1180/2014
Property is also a part, was acquired by the Maharashtra Housing and
Area Development Authority (MHADA).
42. The Plaintiff in his pleadings and evidence have averred and
stated that the sale-deed was to be completed on or before 20.08.2008
within a period of 6 (six) months from the date of agreement.
Defendants No.1 and 2 in their Written-statements have categorically
averred that time was the essence of the contract.
43. Thus, in view of above undisputed factual aspects it is clear
that the parties were on one page that the transaction was to be
completed within the time stipulated in the Agreement to Sell (Exh.65),
which establishes that the time was essence of the contract and thus,
Point No.4 is answered accordingly.
AS TO POINT NO.5 :
44. It is submitted by learned Advocate for the Plaintiff that
Defendant No.3 has accepted the case of the Plaintiff and therefore, the
partial decree to the extent of Defendant No.3 be passed in favour of the
Plaintiffs by modifying the Trial Court's Judgment.
45. As discussed earlier while considering the Point No.1 the
Defendants have entered into Agreement to Sell (Exh.65) with the
Plaintiff. Undisputely, the Defendant No.3 sided with the Plaintiff. In
his Written-statement he admitted the Plaintiff's claim or pleadings in
37 FA1180/2014
the plaint. Categoric averment is made in the Written-statement by
Defendant No.3 that he was ready and willing to perform his part of
contract and to execute the sale-deed in favour of the Plaintiff. In his
Written-statement he averred that necessary orders be passed. Further,
Defendant No.3 declined to cross-examine the GPA / PW1 - Syed Gulam
Rasul Yasin and PW2 - Mirza Parvez Ali Baig examined by the Plaintiff.
For this point, the relevant provision is Order-XII, Rule-6 of the C.P.C.
which reads as under :
"6. Judgment on admissions. -
(1) Where admissions of fact have been made either in the
pleading or otherwise, whether orally or in writing, the Court
may at any stage of the suit, either on the application of any
party or of its own motion and without waiting for the
determination of any other question between the parties, make
such order or give such judgment as it may think fit, having
regard to such admissions.
(2) Whenever a judgment is pronounced under sub-rule (1) a
decree shall be drawn up in accordance with the judgment and
the decree shall bear the date on which the judgment was
pronounced."
46. The evidence on record go to show and there is no dispute
on the aspect that the three Defendants are real brothers and having
their undivided 1/3rd share each, in the Suit Property. The evidence on
record go to show and on which there is no dispute between the parties
that, Defendant No.2 had preferred the Spl. Civil Suit No.293 of 2006
for partition in the properties left behind by his father, including the Suit
Property and all the Defendants had entered into the compromise in the
38 FA1180/2014
said civil suit. The said compromise is brought on record at Exh.126 in
the evidence of the Defendant No.3. The said compromise is not
disputed by any of the party.
47. It has come in the evidence of DW1 - Shaikh Majidullah
Shaikh Barkatullah that as per the said compromise dated 20.02.2008 in
the said Civil Suit it was agreed that they all three brothers (Defendants
No.1 to 3) should sell the Suit Property jointly and terms and conditions
were also decided amongst them as to how to sell the Suit Property. As
seen from the cross-examination of Defendant No. 3 done by DW1 -
Shaikh Majidullah Shaikh Barkatullah and DW2 - Sk. Khalilullah Sk.
Barkatullah it is their case that Defendant No. 3 had put forward the
Plaintiff and wanted to grab the Suit Property with the help of brother-
in-law - Mr. Parvez. This material on record go to show that the terms
between the Defendant No. 3 on one hand and Defendants No. 1 and 2
on the other hand were not cordial. What is gathered from the pleading
and evidence on record is that the Defendant No. 3 - Shaikh Majidulla
Sk. Barkatulla and the Plaintiff - Gulam Ali s/o. Ismail Khan joined
hands and were trying to put spoke in the matters relating to the Suit
Property. As discussed earlier, the Suit Property was a big land within
the city. The Defendant No.3 - Shaikh Majidulla Sk. Barkatulla could
have executed the sale-deed to the extent of his 1/3rd undivided share in
favour of the Plaintiff, if at all he was ready. He can even do it today or
tomorrow. However, he did not do so. This lends credence to the
39 FA1180/2014
above contention of Defendants No. 1 and 2 in respect of Plaintiff and
Defendant No.3. The relief in the nature of Judgment on Admissions is
discretionary and cannot be claimed as of right as held by the Hon'ble
Supreme Court of India in S.M. Asif vs Virender Kumar Bajaj, (2015) 9
SCC 287 and Hari Steel And General Industries Limited and Another vs
Daljit Singh and Others, (2019) 20 SCC 425. Thus, in the facts and
circumstances of the matter, we consider it more appropriate not to
exercise the powers under Order-XII, Rule-6 of the C.P.C. and hence,
Point No.5 is answered accordingly.
AS TO POINT NO.6 :
48. As discussed earlier, it is established from the evidence on
record that the Plaintiff had paid Rs.50,00,000/- as the earnest money in
respect of the transaction at the time of executing the above referred
Agreement to Sell (Exh.65). The terms and conditions of the said
Agreement, which are reproduced above in Paragraph no.25 show that,
it provides for right to the Vendors of forfeiture of the earnest money.
There is no clause in the said Agreement providing automatic forfeiture
of the earnest money. Thus, unless the said right is exercised, the
earnest money will not get forfeited.
49. There is nothing to show that after the expiry of the six (6)
months period which was agreed to complete the transaction, the
Defendants exercised their right of forfeiture of the earnest money by
40 FA1180/2014
informing the Plaintiff regarding the same. As the forfeiture was not
automatic on the expiry of stipulated period, unless the Defendants
expressly exercise their right of forfeiture by their act, the earnest money
won't get forfeited. As there is no exercise of the said right by the
Defendants, the earnest as referred in the Agreement to Sell (Exh.65)
will have to be refunded by the Defendants to the Plaintiff. There is
alternate prayer in the plaint for refund of earnest money with Interest
@ 18% per annum.
50. The evidence on record show that the Plaintiff was dealing
in the business of purchase and sale of landed property. The evidence of
the GPA of the Plaintiff / PW1 - Syed Gulam Rasul Yasin show that the
Plaintiff intended to commercially develop the Suit Property after it was
purchased. The Development Agreement entered by Defendant No.2
with the third party was also the commercial transaction. Section 34 of
the C.P.C. is in respect of the Interest. It provides for interest more than
6% per annum in case of commercial transactions. There is nothing to
show that the interest rate was agreed upon by the parties in case of
refund of the earnest money. It is needless to state that the interest rate
for lending money by the Nationalized Bank in relation to commercial
transactions keep on fluctuating. Keeping this and the fact that the
earnest money were paid in the year 2008, in view, we consider the
Interest at the rate of 7.5% per annum, on the earnest money, from the
date of institution of Suit till its realization to be paid by the Defendants
41 FA1180/2014
jointly and severally to the Plaintiff along with Rs.50,00,000/- i.e.
earnest money.
51. It is clear from the Agreement to Sell (Exh.65) that it was
for the Plaintiff to initially perform his part of contract by paying the
balance consideration amount within the stipulated period and
thereafter it was for the Defendants to execute the sale-deed. There is
no dispute on this aspect. There is no evidence to show that there was
any breach of Agreement to Sell (Exh.65) by the Defendants. Therefore,
the Plaintiff would not be entitled for any compensation. Hence, Point
No.6 is answered accordingly.
AS TO POINT NO.7 :
52. We have perused the impugned Judgment and Order. On
reappreciation of the evidence on record, we do not see that the learned
Trial Court has committed any error by dismissing the suit on the
ground of readiness and willingness of Plaintiff to perform his part of
contract and not awarding compensation. However, in view of our
finding on Point No.6, impugned Judgment and Order / Decree requires
modification.
53. The record show that the Civil Application No.1244 of 2024
was preferred by the Plaintiff/Applicant to implead the third parties with
whom the Defendant No.2 had entered Development Agreement. By
Order dated 21.02.2024 the parties agreed that the Application be
42 FA1180/2014
considered at the time of final hearing. However, no arguments were
advanced by the learned Advocates for the Parties on this Application.
Even otherwise, in view of the above discussion, nothing survives in the
Application.
54. In view of above, we pass the following order :
ORDER
(i) The First Appeal is partly allowed.
(ii) The Plaintiff is entitled for refund of the earnest money of
Rs.50,00,000/- (Rs. Fifty Lakh) with interest @ 7.5% Per
Annum from the Defendants jointly and severally, from the
date of institution of Suit till its realization.
(iii) The impugned Judgment and Order / Decree stands modified
to that effect.
(iv) Decree be drawn up accordingly.
(v) Pending Civil Application Nos.1244 of 2024 and 5366 of 2014
stand disposed of.
(vi) Record and Proceedings be sent back to the learned Civil
Court.
( NEERAJ P. DHOTE, J. ) ( R. G. AVACHAT, J. )
GGP
Signed by: Gajanan G. Punde
Designation: PA To Honourable Judge
Date: 28/08/2024 14:23:05
