Veena Mahajan vs Shri V.N.Verma
1998 Latest Caselaw 379 Del

ORDER

K.Ramamoorthy, J.

1. The plaintiff has filed the suit seeking specific performance of the agreement to sell dated the 14th of February, 1996 with reference to plot No.40 situated at Village Khureji Khas measuring 360 sq.yds.

2. Briefly stated, the case of the plaintiff could be related as under:-

3. The defendant is the owner of the residential plot measuring 360 sq. yards. The defendant inherited the right from his mother the late smt.Sushila Verma, who was a member of the Bhatnagar's Cooperative House Building Society Limited. She died on the 25th of April, 1980 and the defendant, being the sole legal heir, had become entitled to it. The defendant entered into an agreement with the plaintiff for selling the plot for Rs.1,50,000/-. The terms and conditions are as under:-

"1. That the entire consideration amount of the said plot of land is fixed between the parties at Rs.1,50,000/-(Rs.One lakh and fifty thousand only) out of which the first part has received the sum of Rs.40,000/-(Rupees Forty thousand only) from the second party, under legal separate receipt, at the time of execution of this agreement, the first party both hereby acknowledge the receipt of the same and the balance sum of Rs.1,10,000/- (Rupees One lakh and ten thousand only) shall be paid by the second party to the first party at the time of receipt of the letter of the Allotment of the particular number of plot from the office of the Registrar of Society, as per intimation received from the first party under registered A/D, without any hitch or delay.

2. That the first party shall deliver the vacant possession of the said plot of land to the second party at the time of receipt of the balance consideration of Rs.1,10,000/-(Rupees one lakh and ten thousand only).

3. That the first party has assured the second party that the first party is the only legal heirs of the deceased mother and if it is proved otherwise, then the first party shall be liable and responsible for the cosequences.

4. That if any claimant will come forward and claim over the said plot of land or for transfer of the registration number of the Society which stands in the name of the said late Smt.Sushila Verma, mother of the first party, then the first party shall be liable and responsible for the consequences.

5. That the second party has assured the first party that the balance consideration amount of the said plot of land shall be paid by the second party to the first party within seven days from the date of receipt of the information as stated above.

6. That if the first party infringes the terms and conditions of this agreement, then the second party shall be entitled to get the completion of the sale of the said plot of land through the Court of law at the cost of the first party and if the second party fails to pay the said balance consideration amount of Rs.1,10,000/- within the time stipulated above or refuses in writing to purchase the said plot of land from the first party within the time stipulated above, then the said sum of Rs.40,000/- shall be forfeited and the first party shall be at liberty to resell the said plot to whom the first party wishes.

7. That the said plot of land which is to be allotted in the name of the first party is free from all kinds of encumbrances, sale, mortgage, charges, litigation, claim, will, gift, exchange whatsoever and if it is proved otherwise then the first party shall be liable and responsible for the same."

4. The plaintiff had paid a sum of Rs.40,000/- on the date of agreement. The defendant was to deliver the vacant plot of land and on that date the plaintiff was to pay Rs.1,10,000/- being the balance of consideration. On the 21st of January, 1987, the plaintiff paid Rs.10,000/- to the defendant. Again, on the 26th of April, 1987, another sum of Rs.10,000/- was paid by the plaintiff to the defendant. The receipt of the said amount was acknowledged by the defendant in his letter dated the 26th of April, 1987 wherein the defendant had stated that he had received a letter from Bhatnagar's Cooperative House Building Society Limited, in which the society had requested the DDA to allot the plot to the defendant as he had obtained the clearance from the Registrar of Societies, as he had become a member of the society in place of his late mother. By letter dated the 25th of August, 1987, the defendant informed the plaintiff that the DDA had allotted the plot to him and plaintiff should be able to discharge her obligations under the contract within seven days from the date of the receipt of that letter. The defendant had also enclosed a copy of the letter received by him from the Delhi Development Authority. The defendant represented to the plaintiff that he would get a formal lease deed executed by DDA in his favour and then, he would convey his right to the plaintiff, as agreed. The defendant wanted some more money and on the 29th of September, 1987, the plaintiff paid a sum of Rs.15,000/- and the defendant had issued the receipt. He had also agreed to act in terms of the agreement. The plaintiff paid further sum of Rs.5,000/- on the 20th of November, 1987. The balance as on the 20th of November, 1987 was Rs.70,000/-.

5. It appears that on the 30th of November, 1987, a perpetual sub-lease was executed in favour of the defendant by the DDA and the same was presented for registration on the 10th of December, 1987. Having come to know this fact, the plaintiff requested the defendant to execute the necessary document in favour of the plaintiff and she had always been ready and willing to perform her part of the contract. Seeing the attitude of the defendant in trying to avoid his obligation under the contract, the plaintiff sent a notice on the 24th of January, 1988 telegraphically calling upon him to execute the document by receiving the balance of Rs.70,000/-.

6. The defendant sent the reply dated the 29th of January, 1988 stating that the balance payable under the contract should have been paid within seven days of the allotment of the plot in his favour, as intimated by him by letter dated the 25th of August,1987, and the plaintiff having failed to do so, had lost her rights under the contract and she was not entitled to seek the performance of the agreement by the defendant.

7. As the defendant had failed to comply with the demand made by the plaintiff, she had filed the suit praying for the following reliefs:-

"It is, therefore, prayed that a decree for specific performance of the Agreement to Sell dated 14th February, 1986 to sell the leasehold rights in Plot No.40 situated at Village Khureji Khas, Chitra Vihar, Behind Radhu Place, Delhi, admeasuring 360 sq.yds., be passed in favour of the plaintiff and as against the defendant.

Further prayed that the defendant be ordered to deliver possession of the plot to the plaintiff after getting the requisite permission from the Delhi Development Authority.

Further prayed that, in the alternative, the plaintiff be paid/refunded the part payment received by the defendant under the Agreement to Sell dated 14th February, 1986, i.e. Rs.80,000.00 with interest @ 18% per annum and future interest at the same rate till its realisation, along with damages by way of compensation in the sum of Rs.5,20,000.00(Rupees five lakhs and twenty thousand only).

Further prayed that the plaintiff may also be awarded costs of the suit."

8. The defendant filed the written statement on the 26th of September, 1989. The contents of the written statement could be given in an abridged form in the following terms. The plaintiff is guilty of breach of contract. The defendant, by letter dated the 25th of August, 1987, informed the plaintiff that he had been allotted the plot and requested the plaintiff to take necessary steps to fulfill her contractual obligations within seven days. That letter was received by the plaintiff on the 28th of August, 1987. The plaintiff did not do anything within the period of seven days, as mentioned and, therefore, the plaintiff had committed the breach. The defendant had admitted the payments made by the plaintiff and mentioned in his written statement. In his reply on merits, he would state:

"It is submitted that Bhatnagar Cooperative House Building Society Ltd. was not ready to transfer the plot in the name of the defendant. The plaintiff on coming to know about this fact approached the defendant and stated that she can influence the society to transfer the plot in the name of the defendant provided the defendant agrees to sell the plot to her for a paltry sum of Rs.1,50,000/-. The defendant agreed to the said request as he was urgently in need of some money. The defendant was, thus coerced to sign the agreement to sell dated 14.2.1986 with the plaintiff as he was urgently needed some money and the plaintiff promised to get the plot transferred in the name of defendant provided the defendants sells the same to her for a paltry sum of Rs.1,50,000/-.

9. The plaintiff was not in a position to pay the balance of consideration and on her failure to pay within seven days, as mentioned above, the contract stood terminated. As per the terms of the Agreement to Sell dated the 14th of February, 1986, the defendant was only obliged to inform the plaintiff about the allotment of plot to him and immediately the plaintiff should have made the payment of the entire balance of consideration. According to the defendant, transfer of the perpetual lease deed in favour of the defendant by the DDA to the plaintiff did not form part of the Agreement to Sell. The defendant never "backed out from fulfillling his part of the contractual obligations but it is the plaintiff who was not in a position to fulfill her part of the contractual obligations". The defendant has been harping only on his case that the plaintiff did not act within seven days of the receipt of the letter dated the 25th of August, 1987.

10. The plaintiff filed here replication on the 13th of March, 1990. It is stated by the plaintiff that the plaintiff had always been ready and willing to fulfill his part of the contract. On a reading of the entire agreement, the intention of the parties was very clear and that was that the balance of consideration was to be paid on receipt of the letter of allotment from the office of the Registrar of Societies and when the defendant was in a position to give possession of the property to the plaintiff. The plaintiff has mentioned that she had always resources at her command and there was absolutely no difficulty for her to pay the amount when the defendant was in a position to execute the document and give possession of the property. The plaintiff has denied all the averments made in the written statement and it is not at all necessary to recount them here.

11. On these pleadings following issues were framed for trial on the 23rd of May, 1996.

"1. Whether the plaintiff is entitled to specific performance of the agreement dated 14.02.1986 with regard to plot No.40 in Chitra Vihar, as pleaded in the plaint?

2. If the plaintiff is not entitled to specific performance, whether the plaintiff is entitled to the refund of the part payment made by her?

3. To what amount of damages, if any, is the plaintiff entitled.

4. Relief"

12. The plaintiff had filed documents P-1 to P-22 and the defendant has filed his documents D-1 to D-8. The plaintiff examined PW-1, an Assistant from Punjab National Bank. PW-2 is the Assistant Manager, Indian Bank, West Patel Nagar. The plaintiff examined herself as PW-3. The defendant did not examine any independent witness and he examined himself as DW-1.

13. Before referring to the evidence of PW-1 and PW-2, I wish to consider the evidence of PW-3 and DW-1 to find out whether the plaintiff had been ready and willing to perform her part of the contract and whether the defendant had committed breach of the terms of the agreement. A reading of her deposition would clearly show that she had always been ready and willing to perform her part of the contract and she had means to pay the balance of consideration. She had paid Rs.80,000/- out of Rs.1,50,000/- and what was payable was Rs.70,000/-. Nothing has been elicited by the defendant in the cross-examination of PW-3(plaintiff) to show that she was not ready and willing to perform her part of the contract. On the contrary, the defendant in his evidence has shown himself to be a person who is prepared to say anything just for the purpose of achieving his purposes. In the chief examination, DW-1 would state:

Q.2. Whether this was the letter you have written to her?

A. I Informed the plaintiff by the letter dtd.17.12.1986 about the clearance of membership from the Registrar of Societies that is marked as Ex.D-1.

Q.3. Did you see any letter in March, 1987 about the Bhatnagar's house?

A. Yes, the allotment letter was of dtd.30.3.87. This is the letter issued by BHATNAGAR COOPERATIVE SOCIETY to the D.D.A. informing about the plots the defendant was allotted plot No.40 in category 'B'. It is marked as Ex.D-2.

Q.4. Tell us when you were supposed to be paid the balance sale consideration?

A. It is clearly agreed in the agreement that the day, I will be informed by the Registered A.D. and the moment they will receive my registered A.D. within seven days, they had to clear the balance consideration amount.

Q.5. What was the letter that was supposed to be informed?

A. It was the allotment of the plot from the D.D.A. as per the terms of the agreement. The letter dtd.25.8.87 along with a letter which was issued by D.D.A. to the Cooperative Society, is marked as Ex.D-3."

14. About the compliance by the plaintiff of the request made by the defendant, the defendant would depose:

"Q.6. Did they pay that amount within 7 days?

A. No.

Q.7. Did they refuse to pay?

A. They never came to me, I repeatedly requested them to kindly pay the balance amount, but they always tried to make false statements saying that we are trying, okay, we are trying. In all, the payments were not made.

15. When the witness was asked about the effect of the letter issued by him on the 25th of August, 1987, he would explain by stating:

Q.8. What was the effect of your notice?

A. I have already mentioned in my notice that I am not going to terminate this agreement. Now our conditions are changed. By that notice dtd. 25.8.1987 the balance consideration was not paid the, agreement would stand terminated and the agreement would be signed. It is exhibited as Ex.D.4. The same was sent by registered letter, the receipt issued the registered letter is marked as Ex.P-5 and it is marked as Ex.P-6."

16.According to the witness, after cancellation he had entered into an agreement with a third party and he would state:

"Q.15. After the cancellation of the agreement, did you enter into any agreement with any other person?

A. YES. I entered into an agreement with Mr.Kamlesh Gupta, dtd.29th January, 1988. Agreement is exhibited as Ex.D-8.

Q.16. Did you receive any consideration from Mr.Gupta?

A. YES.

17. In the cross-examination, the witness would admit that after the notice by him on the 25th of August, 1987(D-4), he had received two payments from the plaintiff without any demur. He was not in a position to reply to the question that the lease deed was executed in his favour on the 12th of January, 1988. To the question whether he was in a position to deliver possession before any document was executed in his favour, he would state:

"Q.20. Prior to 12.1.1988, you were not in a position to deliver the possession in terms of the agreement executed between you?

A. No, that is incorrect."

18. He would deny what is stated in clause 2 of the Agreement.

Q.23. Did in clause 2, you were to receive the amount on handing over of the vacant possession?

A. That is not correct.

19. The witness would further depose:

Q.24. You have been approaching to the authorities for the house of the plaintiff and in your own hand, all the receipts are written and signed?

A. Yes, all the receipts are in my writing. It is only the plaintiff who approached me and therefore, I went.

Q.25. The receipt which you have produced alongwith your application does not show anywhere that you have entered into any agreement with the 3rd party?

A. Alongwith the application I filed the general power of attorney in favour of Mr.Ganga Prasad Gupta, marked as Ex.P-7.

Q.26. In the receipt which has been filed and exhibited as Ex.P-8, any agreement was there?

A. I had not studied anywhere.

Q.27. Besides these two documents, there was no agreement executed between you and the third party?

A. NO, there is no other agreement showing that I have entered into the third party agreement."

20. The learned counsel for the plaintiff, Mr.Nayyar, submitted that the plaintiff has established her case and she had been ready and willing to perform her part of the contract. About the mobilisation of resources, she had led sufficient evidence and evidence of PW-1 and PW-2 would go to show conclusively that the plaintiff had the necessary money for paying the balance of consideration to the defendant. Learned counsel submitted that under Section 16 of the Specific Relief Act, 1963, the law is well settled that the plaintiff is not obliged to show the money to the other side. The learned counsel, in support of plaintiff's case, brought to my notice the following authorities:

21. AIR 1928 Privy Council "Adreshir H.Mama Vs. Flora Sassoon"; ILR 1970 186 "Narayan Panicker Ramakrishna Panicker & Others Vs. Narayan Pillai Krishna Pillai & Others"; MPLJ 1976 518 "Damrodar Harchand & Others Vs. Laxmi Narayan Ramanujdas Brijpuria & Others; "N.P.Thi-

rugnanam (D) by Lrs. Vs. Dr.R.Jagan Mohan Rao & Others";

"His Holiness Acharya Acharya Swami Ganesh Dassji Vs. Shri Sita Ram Thapar"; "Smt.Chand Rani Vs. Kamal Rani";

"M/s.P.R.Deb & Associates Vs. Sunanda Roy"; 1995 Supp (2) S 680 "S.Rangaraju Naidu Vs. S.Thiruvarakkarasu"; "Kanshi Ram Vs. Om Prakash Jawal & Others"; "Lourdu Mari David & Others Vs. Louis Chinaya Arogiaswamy & Others"; "Kallathil Sreedharan & Another Vs. Komath Pandyala Prasanna & Another";

22. Principles are well settled and I do not want to deal with the authorities in great detail.

23. The learned counsel for the defendant, Mr.Vijay Kumar, vehemently contended that the plaintiff by her conduct had waived her rights and on a proper construction of the agreement to sell, the parties had intended that on the defendant giving information to the plaintiff about the allotment, within seven days the plaintiff should pay the balance of consideration and the plaintiff failed to do that and consequently, she lost her rights under the agreement and she became disentitled to seek the relief of specific performance. Mr. Vijay Kumar, learned counsel for the defendant, submitted that the plaintiff had accepted clauses 5 & 6 in the contract and that is enough to know the intention of the plaintiff. It was contended by Mr.Vijay Kumar that the plaintiff did not comply with Section 67 of the Contract Act, 1872. According to the learned counsel, there has been a novation under Section 62 of the Contract. Learned counsel, Mr. Vijay Kumar, also submitted that the contract is vitiated by uncertainty. He stressed the point that the time was the essence as per the terms of the contract and inasmuch as the plaintiff failed and negligent to pay the balance consideration within seven days on the receipt of notice dated the 25th of August, 1987, the plaintiff was ineligible to enforce the contract. Learned counsel also referred to the Section 13 of the Specific Relief Act, 1963. The learned counsel, Mr.Vijay Kumar relied on the following authorities.

24. AIR 1984 SC 664 "V.S.Talwar Vs. Prem Chand Sharma"; AIR 1988 1074 "Smt.Indira Kaur & Others Vs. Shri Sheo Lal Kapoor"; 1997 (2) Supreme 639 "Bibi Jaibunish Vs. Jagdish Pandit & Others; "Nathulal Vs. Phoolchand "M/s.Eldee Velvet & Silk Mills Pvt. Ltd. Vs. Shri Anant Ram Whig"; AIR 1994 SC 1050 "Surya Narain Upadyaya Vs. Ram Roop Pandey & Others"; "Anil Gupta Vs. Atul Kumar Gupta & Others";

25. On a consideration of the materials placed before me, I have no hesitation in coming to the conclusion that the plaintiff is entitled to the relief of specific performance. She had acted in accordance with the terms of the contract. Mr.Vijay Kumar advanced an argument on the basis of terms of clause 1 of the contract without any reference to clause 2. The learned counsel submitted that the plaintiff was obliged to pay Rs.1,10,000/- at the time of receipt of the letter of allotment of the particular number of plot from the office of the Registrar of Societies as per intimation received from the defendant without any hitch or delay. The learned counsel, Mr.Vijay Kumar would argue on the premise that clause 2 has absolutely no connection whatsoever with clause 1. Under clause 2, the plaintiff was obliged to pay Rs.1,10,000/- on the defendant giving possession of the plot. It is admitted by the defendant that by November, 1987 he had received over and above what was paid as advance and the balance was Rs.70,000/-. The specific intention was that the defendant was to receive the balance only on his being all to deliver possession of the property. It is a well recognised principle of construction of documents that for the purpose of ascertaining the intentions of the parties, the entire document has to be read as a whole. One part of the document cannot be relied on out of its context and in isolation without considering other terms of the document. Reading the agreement as a whole, the intention is very clear that the plaintiff was obliged to pay the balance of consideration on the defendant getting full title and his readiness to deliver possession of the property to the plaintiff. The defendant came forward with a case that on the date of his reply which was sent on the 21st of September, 1988, he had entered into an agreement with a third party. That itself is not a correct representation. He had only executed a power of attorney and if really there was any agreement, that cannot be projected against the plaintiff. The alleged agreement vendee has not been examined and that is fatal to the case of the defendant.

26. Under these circumstances, I proceed to give findings on the issues. On issue No.1, I find that the plaintiff is entitled to the specific performance of the agreement and on issue No.2, I find that the question of refund to the plaintiff does not arise in view of the plaintiff getting the relief of specific performance. The suit stands decreed.

27. There shall be a decree:-

1. directing the plaintiff to deposit the sum of Rs.70,000/- on or before the 31.7.1998.

2. on the plaintiff depositing the amount, the defendant shall execute necessary document in favour of the plaintiff within thirty days from the date of deposit and in the event of the defendant not executing the necessary document, the plaintiff shall be entitled to apply for a proper direction for the appointment of an officer of this Court for the purpose of executing the required documents in favour of the plaintiff and for registering the same at the cost of the plaintiff.

3. directing the defendant to pay the plaintiff the costs of this suit.