Bombay High Court
Kusum Suryakant Yannawar vs Mangala Subhash Sangewar And Others on 18 August, 2025
2025:BHC-AUG:22372
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD
SECOND APPEAL NO. 72 OF 2006
WITH CIVIL APPLICATION 12990 OF 2024
Sow. Mangala w/o Subhash Sangewar
Age : 35 yrs., Occu. : Household,
R/o Gajanan Nagar, Karegaon Road,
Parbhani, Dist. Parbhani.
Through G.P.A. of
Shri. Subhash s/o Kishanrao Sangewar,
R/o Gajanan Nagar, Karegaon Road,
Parbhani, Dist. Parbhani. ... APPELLANT
(Ori. Plaintiff)
VERSUS
1. Sow. Kusum w/o Suryakant Yannewar,
Age : 35 years, Occu.: Household,
Affairs r/o Anandnagar, Parbhani.
2. Chairman Shantiniketan Grahanirman
Society Taran Sanstha
r/o In front of S.T. workshop, Gangakhed Road,
Parbhani.
3. Manager,
Maharashtra State District Co-operative
Housing Finance Bank,
Umrikar's Building, Near Civil Hospital,
Parbhani. ... RESPONDENTS
(Ori. Defendant Nos.1 to 3)
Mr. S. B. Bhapkar, Advocate for the Appellant
Mr. R. F. Totala a/w Mr. S. V. Lohiya, Advocate for Respondent No.1
Mr. S. K. Chavan, Advocate for Respondent No.2
Ms. Rekha Choudhari h/f Mr. S. S. Choudhari, Advocate for Respondent
No.3.
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CORAM : R. M. JOSHI, J.
RESERVED ON : 13th AUGUST, 2025
PRONOUNCED ON : 18th AUGUST, 2025
JUDGMENT :
-
1. This Second Appeal is filed under Section 100 of the Code of
Civil Procedure (for short 'CPC') takes exception to the judgment and
decree passed in R.C.S. No. 132/1999 dated 22/07/2004, whereby the
suit filed by the Plaintiff for specific performance of the contract is
dismissed and counter claim by the Defendants for the possession of the
suit property is allowed and confirmation thereof in R.C.A. No. 112/2004
by judgment dated 24/11/2005.
2. Parties are referred to as 'Plaintiff' and 'Defendants' for the
sake of convenience.
3. The facts as they appear from the record indicate that
Defendant No.1 is the owner of the suit house. By an agreement dated
11/03/1994, she agreed to sale the suit house to Plaintiff for total
consideration of Rs.80,000/-. Further admittedly at that time of
execution of the agreement to sale a sum of Rs.40,000/- was paid by
Plaintiff the Defendant No.1. It was a term in the agreement that the
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balance consideration of Rs.40,000/- shall be paid in 80 equal monthly
installment of Rs.500/- per month. The Plaintiff paid 16 installments and
a total sum of Rs.8,317.40 was paid to Defendant No.2. However,
thereafter Plaintiff did not pay the amount of installment on the ground
that Defendant is not repaying the loan in respect of the suit house. The
Plaintiff therefore, addressed notice dated 18/01/1996 making such
allegation and calling upon Defendant No.1 to accept the entire balance
consideration and to execute the sale deed. Defendant No.1 did not
respond the said notice. The suit came to be filed for specific
performance of contract on 20/04/1999. Plaintiff has deposited the
balance consideration before the Trial Court during the pendency of the
suit.
4. Trial Court framed issues vide Exhibit 21 and the burden was
cast upon the Plaintiff to prove agreement to sale and willingness and
readiness to perform her part of the contract in respect of the counter
claim Defendant No.1 was called upon to prove that Plaintiff has failed to
perform the contractual obligation and hence, she is entitled for recovery
of the possession of the suit house from Plaintiff. Parties led oral as well
as documentary evidence. On behalf of the Plaintiff, Plaintiff's husband
Subhash was examined at Exhibit 34. Another witness Ganesh Ghuge
(Exhibit 41) is examined in respect of the proof of agreement to sale.
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Defendant No.1 entered into the witness box and deposed at Exhibit 48
and also led evidence of Munjaji (Exhibit 52) and Anil More (Exhibit 54).
Defendant Nos.2 and 3 did not lead any evidence.
5. After hearing both sides, the Trial Court by impugned
judgment and decree dated 22/07/2004 dismissed the suit and decreed
counter claim. Being aggrieved by the said judgment and decree, Plaintiff
preferred R.C.A. No. 112/2004. Since the said Appeal is dismissed,
hence, this Second Appeal.
6. This Court by order dated 02/03/2006 has framed following
substantial question of law:
(i) Whether the Courts below committed manifest error
in dismissing the suit for specific performance of contract
even though the time was not the essence of the contract
as per terms of the contract ?
(ii) Whether the Courts below committed manifest error
in passing the decree of restoration of possession to the
defendant No.1, without directing her to refund the earnest
amount received by her?
(iii) Whether the Courts below committed manifest error
in holding that the plaintiff-appellant was not ready and
willing to perform the contract by paying the balance
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amount?
(iv) Whether the Courts below committed manifest error
in holding that the specific performance of contract would
not be granted in favour of the plaintiff-appellant because
the property was mortgaged with respondent No.3, inspite
of the terms of contract between the parties?"
7. Learned Counsel for the Plaintiff submits that the Courts
below have committed error in dismissing the suit for the reason that the
Plaintiff has not entered into the witness box and instead examined her
husband. It is his submission that Trial Court has also committed error in
not considering the notice dated 18/01/1996 (Exhibit 35) issued by the
Plaintiff to Defendant No.1 calling upon her to accept the entire balance
consideration and to execute the sale deed. It is his further submission
that though such offer was made as back in the year 1996, the Appellate
Court has committed error in holding that such offer was made for the
first time during the cross-examination of Defendant No.1. Thus,
according to him is a perverse finding being contrary to the evidence on
record and hence, deserves interference. It is his further submission that
out of the consideration of Rs.80,000/-, half of the amount i.e.
Rs.40,000/- is paid at the time of execution of agreement to sale and
remaining amount was not paid for the reason that Defendant No.1 was
not repaying the loan and that the suit property was mortgaged. It is his
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submission that the offer made by the Plaintiff to Defendant No.1 to
accept the entire consideration itself indicates her willingness and
readiness to perform part of the contract. Thus, it is his contention that
the suit deserves to be decreed and consequently, counter claim needs
to be dismissed. Without prejudice to the afore stated submission it is his
argument that in case this Court holds that no decree of specific
performance can be granted, the earnest money be directed to be
refunded to the Plaintiff, so also the amount deposited in the Court of the
balance consideration be permitted to be withdrawn along with interest
accrued thereon.
8. Learned Counsel for Defendant No.1 submits that in case of
the suit for specific performance of contract, Plaintiff is required to prove
that at the point of time Plaintiff was ready and willing to perform the of
the contract and then only Plaintiff is entitled to seek decree of specific
performance. It is further submitted that in the instant case, there was
no condition in the agreement to sale that Rs.500/- received by the
Defendant No.1 would be deposited in the bank towards repayment of
the loan. In absence of any such condition, there was no justification for
Plaintiff not paying the installments after first 16 installments. It is also
argued that though the last installment was paid in all around June-July,
1995, however, the notice was issued admittedly after six months. It is
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his further submission that when the Defendant No.1 has not responded
to the said notice, it was obligatory on the part of the Plaintiff to file suit
for specific performance of contract immediately. It is his submission that
the suit has been filed belatedly in April, 1999. Thus, according to him
the conduct of the Plaintiff disentitles her to seek decree of specific
performance of contract. It is further argued that once the Defendant
No.1 has established that the Plaintiff has to failed to perform her part of
contract, Defendant No.1 is entitled for the possession of suit property.
9. As far as non examination of Plaintiff herself is not fatal to
her case, since on her behalf her husband led evidence. There is no
dispute made with regard to his personal knowledge in respect of the
facts involved in this case. In view of Section 120 of the Evidence Act,
husband is competent witness of Plaintiff and therefore, non examination
of Plaintiff, would not be sufficient to dismiss suit. The entire evidence
led by Plaintiff, however, is required to be taken into consideration to
decide fate of her suit.
10. Perusal of the evidence on record indicates that execution of
agreement to sale dated 11/03/1994 for sale of suit house is not in
dispute. The agreed consideration between the parties is Rs.80,000/-.
Out of total consideration, a sum of Rs.40,000/- is paid by way of
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earnest money at the time of execution of agreement. The agreement
(Exhibit 35) indicates that the balance amount of consideration was to be
paid by the Plaintiff to Defendant in 80 equal monthly installments of
Rs.500/- per month. The said agreement does not indicate that it was a
condition of the contract that the said amount of Rs.500/- paid by the
Plaintiff would be deposited with the bank where the suit house is
mortgaged. Admittedly, out of Rs.40,000/- a sum of Rs.8,317.40 was
paid by way of installments and balance amount of Rs.31.682.60 remain
unpaid.
11. Considering the date of execution of agreement to sale, and
in view of the fact that admittedly first 16 installments were paid, in or
around June-July, 1995 last installment came to be paid. However,
admittedly the notice is issued to Defendant only after six months
therefrom i.e. on 18/01/1996. Defendant No.1 does not dispute the
receipt of the said notice, however, there is nothing on record to indicate
that Defendant No.1 has accepted the contention of the Plaintiff. It is
pertinent to note that the agreement to sale does not bear recital that
Rs.500/- per month paid by the Plaintiff to the Defendant would be
deposited in the bank against the repayment of the loan. Thus by issuing
notice dated 18/01/1996 and by offering to pay the entire balance
consideration, the Plaintiff had sought novation of the contract.
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Defendant No.1 having not accepted the same, the terms of the contract
i.e. agreement to sale dated 11/03/1994 remained unchanged.
12. Now, question arises as to whether the Plaintiff can be said to
be ready and willing to perform his part of the contract during the entire
period. The law on this issue is settled to say that the Plaintiff is required
to plead and prove his readiness and willingness to perform his part of
the contract right from the execution of agreement till the finalization of
the decree. The non compliance of terms of agreement by Plaintiff also
would be relevant. In such position of law, the facts on record indicate
that for about six months Plaintiff did not pay any installment as agreed
and thereafter offer the entire amount to there Defendant. Thus, clearly
there is breach of condition of the agreement on the part of the Plaintiff.
Merely because the Plaintiff offers the entire consideration subsequently,
that would not wipe out the effect of non compliance of the contract by
the Plaintiff for a substantial period of six months.
13. Apart from this, it is necessary to take note of the fact that
though it is the case of the Plaintiff that Defendant No.1 did not respond
to the notice dated 18/01/1996, however, the suit has been filed after
lapse of period of three years therefrom. Notice is dated 18/01/1996,
whereas the suit is filed on 20/04/1999. The conduct of the Plaintiff of
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filing suit for specific performance of the contract belatedly also disentitle
her to seek specific performance of contract.
14. The law on the point of the time being not essence of the
contract in case of sale of immovable property is no more res integra,
however, at the same time the Plaintiff cannot be permitted to sleep over
is right and to file the suit at the end of the period limitation. Herein this
case, Plaintiff was in the possession of the suit property. She has failed
to comply with the terms of the contract and even after issuance of
notice in the year 1996, the suit came to be filed after three years i.e. in
the years 1999. In such case, though the time is not essence of the
contract, conduct of the Plaintiff becomes relevant for deciding
discretionary relief against her. Apart from this, it is pertinent to note
that Defendant No.1 has admittedly sold the suit property for the
purpose of discharging loan which was obtained by her and therefore,
though the time was not essence of the contract, the facts on record
indicate it was necessary for Defendant No.1 to receive the entire
amount as agreed in time.
15. In so far as the contention of learned Counsel for the Plaintiff
about there being no direction issued by the Trial Court for refund of
earnest money and the such prayer being made now is concerned, the
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law on the point is settled to show that the making of the prayer to that
effect in the plaint is a sine qua non for grant of refund of the earnest
money. In this regard the latest judgment of the Hon'ble Supreme Court
can be referred in case of K.R. Suresh Vs. R. Poornima and Ors.,
MANU/SC/0629/2025.
16. In view of the said settled position law, there is no error
committed by the Trial Court in not directing refund of the earnest
money. Similarly, for want of any prayer, the such request cannot be
considered at this stage.
17. However, it is a matter of fact that the Plaintiff has deposited
the balance consideration before the Trial Court and seeks withdrawal of
the same. The balance amount of consideration deposited by the Plaintiff
in the Trial Court is not earnest money paid to the Defendant No.1. In
such circumstances, when the decree of specific performance of contract
has been refused, the Plaintiff would be entitled to withdraw the amount
deposited in the Trial Court along with interest accrued, if any.
18. In view of the above discussion, no perversity is find in the
impugned judgment and decree and the concurrent findings recorded by
both Courts do not deserve interference for want of perversity.
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Consequently, the substantial questions of law framed by this Court as
recorded above are answered in negative.
19. As a result of above discussion, the Appeal stands dismissed.
However, the Plaintiff is permitted to withdraw the amount deposited in
the Trial Court along with interest accrued, if any.
20. Pending Civil Application, if any, stands disposed of.
(R. M. JOSHI, J.)
LATER ON
21. Learned Counsel for the Petitioner seeks continuation of
interim relief for a period of three months.
22. Learned Counsel for the Respondents opposes for
continuation of interim relief.
23. In view of the fact that interim relief is in force since 2006,
there is no impediment to continue the same for a period of eight (08)
weeks from today. Hence, it is extended for a period of eight (08) weeks
from today.
(R. M. JOSHI, J.)
ssp
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