Shri N.K. Widhani And Ors. vs Shri Ajit Pershad Jain
2002 Latest Caselaw 747 Del

JUDGMENT

Devinder Gupta, J.

1. This appeal has been preferred by the defendants against the judgment and decree passed by learned Single Judge on 26.5.1989 in Suit No. 389/77 thereby granting a decree for specific performance of agreement to sell in favor of the plaintiff/respondent against the defendants/appellants in terms of agreement dated 19.12.1976 (Ex.PW.2/1). Two months time was allowed to the plaintiff to deposit balance amount of Rs. 2,50,000/-. Thereafter, the defendants were to file necessary applications seeking permission/no objection from the concerned authorities and within a period of two weeks thereafter to execute requisite sale deed in favor of the plaintiff/respondent making it clear that on failure on the part of the defendant to comply with directions, it will be open to the plaintiff to apply for issuance of directions to the Registrar of the Court to execute the sale deed on behalf of the defendants. The plaintiff/respondent was also held entitled to the costs of suit.

2. The facts in brief, which are not in dispute, are that in August, 1976 the defendant advertised for sale of the property in dispute, namely, B-59, Babar Road, Bengali Market, New Delhi. A large number of prospective buyers came to see the house but deal could not be finalised. On 15/16-12-1976 stamp papers of the value of Rs. 2/- for sale agreement were purchased and on 19.12.1976 a hand written agreement to sell was prepared. Under the terms of this agreement, the defendants 1 to 5 were described as the sellers whereas the plaintiff as the purchaser for a total sale price of Rs. 2,65,000/-, subject to permission by the Land and Development Office. The defendants agreed to sell the property to the plaintiff stating that property was free from any lien, charges and encumbrances. Sale price was fixed at Rs. 2,65,000. Plaintiff was to pay a sum of Rs. 10,000/- in cash as advance. Defendants agreed to deliver vacant and peaceful possession of the property soon after the sum of Rs. 1,65,000/- is paid by the plaintiff to defendant No. 6 on behalf of defendants 1 to 5. Plaintiff was to pay another sum of Rs. 35,000/- within 15 days of the date of receipt of intimation of the permission to sell the property by Land and Development Office and balance of Rs. 55,000/- was to be paid by the plaintiff at the time of execution and registration of sale deed before the Sub Registrar, Delhi.

3. The above, deal was admittedly struck through one Shri Bikram Singh, Property Broker. Plaintiff paid the sum of Rs. 10,000/- to the defendants through defendant No. 6 as an advance. As possession was not delivered by defendants 1 to 5 on receipt of Rs. 1,65,000/-. Though according to the plaintiff that though he was ready with the money but defendant No. 6 inspite of promising to do so had been postponing the plaintiff on one pretext or the other. Plaintiff also visited Jaipur and requested defendant No. 6 to fix date and time of his visit to Delhi for acceptance of the amount and on acceptance to deliver vacant possession. The plaintiff thereafter on 3.5.1977 sent notice Ex.P.1 through his lawyer calling upon the defendants to receive the sum of Rs. 1,65,000/- and on receipt thereof to deliver physical and vacant possession of the premises within next three days of the telegram. On failure of the defendants to comply with the requirement of notice, the plaintiff filed a suit for grant of decree for possession against the defendants on 17.5.1977. Before filing of the suit, the plaintiff got prepared a bank draft in the sum of Rs. 1,65,000/- from Andhra Bank Ltd. After institution of the suit, the plaintiff deposited Rs. 2,00,000/- in fixed deposit to show his readiness and willingness to perform his part of the contract.

4. The suit was contested by the defendants, who filed written statement raising numerous defenses. Replication was also filed by the plaintiff. During pendency of the suit, taking not of the defense of the defendants, the plaintiff sought amendment of the plaint, which was also vehemently opposed by the defendants but the amendment ultimately was allowed. The Plaintiff was permitted to convert his suit into a suit for specific performance of agreement to sell and for possession and consequently amended plaint was filed on 17.12.1979 to which the written statement was filed by the defendants on 15.2.1980. Replication was also filed by the plaintiff.

5. On the pleadings of the parties, following issues were framed:-

"1. Whether the suit in the present form is maintainable? O.P.P.

2. If the issue No. 1 is decided in favor of the plaintiff whether the plaintiff is not entitled to the relief claimed because of the provisions of Section 27 of the Urban Land (Ceiling & Regulation) Act, 1976 and also for want of permission from the Land and Development Officer, New Delhi? O.P.D's.

3. Whether the plaintiff has committed breach of the contract as alleged in paras 8 and 9 of the written statement. If so to what effect? O.P.D.'s

4. Whether the plaintiff has been ready and willing to perform his part of the contract? OPP

5. In case if any specific performance is refused to the plaintiff whether he is entitled to damages in the alternative? If so to what amount? O.P.P.

6. Relied."

6. Additional issue No. 5A was framed on 15.7.1980:-

"Whether agreement to sell is void and in operative in view of the reasons stated in preliminary objection No. 4 of the amended written statement dated 12th February, 1980."

7. Parties thereafter led evidence. The plaintiffs examined one Shri Sushil Kumar, PW.1; himself appeared as PW.2 and examined Shri Padam Singh Jain as PW.2. The defendants examined Shri G.D. Widhani on commission and in addition to defendant, statement of one witness was examined on behalf of the defendants, namely, Shri Keshav Chand Tyagi, Clerk from the Collector Stamps. Tis Hazari, Delhi. Parties also placed reliance upon a number of documents.

8. By the impugned judgment, learned Single Judge answered issue No. 1 in favor of the plaintiff holding the suit to be maintainable in the present form Issues No. 2 to 5 were decided together. Issues No. 2, 4 and 4 were answered in favor of the plaintiff and against the defendants. Issue No. 5 was held not arising, in view of finding that the plaintiff was entitled to grant of decree for specific performance. Issue No. 5A was answered against the defendants. Consequently, learned Single Judge proceeded to decree the plaintiff's suit. Learned Single Judge held that a concluded agreement for sale of the property was entered into between the parties; the plaintiff did not commit any breach of the contract and has always been ready and willing to perform his part of the contract. Considering the submissions brought on record, it was held that relief of specific performance cannot be refused to the plaintiff. There was also no other equitable circumstance brought on record by the defendants by which the said relief be declined to him. This judgment and decree is now under challenge in this appeal by the defendants at the bar.

9. We have duly considered the submissions made at the bar, perused the entire record and the decisions cited.

10. On behalf of the defendants/appellants it was urged that the plaintiff has sought specific performance merely on the basis of receipt dated 19.12.1976 (Ex.DW/1/1). The receipt was not a concluded document as the bargain recorded therein is inconclusive and indefinite. It is silent on the terms, most material for a sale. The receipt does not appoint liability for payment of unearned increase, payable to the perpetual Lesser i.e. Land and Development Officer, Government of India, amounting to nearly 50% (Rs. 1.30 lakhs) of the sale consideration of Rs. 2.65 lakhs. The receipt does not appoint liability for payment of property taxes till the completion of the transaction or for other legal charges in connection with the sale. No specific time is appointed for (1) payment of the next Installment of Rs. 1.65 lakhs, (2) handing over the possession and (3) obtaining the mandatory permissions from the Land and Development Office and the Reserve Bank of India. It was urged that such an inchoate document can never form the basis for a suit for specific performance.

11. It was also urged on behalf of the appellant that there was uncertainty about the vendee. The receipt dated 19.12.1976 states that the earnest money has bene received from Shri Ajit Prasad Jain whereas on the reverse thereof signatures of Padam Singh Jain appear, which are dated 21.12.1976. Suit has not been filed by Padam Singh Jain whereas both Ajit Prasad Jain and padam Singh Jain claimed during evidence that both were parties to the transaction. This circumstance has harboured uncertainty to the agreement in as much as parties the were not ad idem as to who is the vendee. It was urged that the testimony of PW.3 clearly indicates that he is also a proposed vendee and for this reason alone he is a party to the receipt. If this be so, the suit is incompetent in the absence of PW.3 as a co-plaintiff. It was further urged that readiness and willingness will be lacking in so far as the vendees are concerned. The plaintiff himself understood that the receipt was not the final document and, therefore, he sent a draft agreement to sell. The said draft could not be finalised because the parties were not ad-idem with respect to the sale consideration shown therein. If the plaintiff's testimony is to be believed, the liability for payment of the unearned increase was that of the defendants. This amount would have been Rs. 1.30 lakhs being nearly half of the sale consideration. Property tax up to the date of sale deed was liability of the defendants. Plaintiff was free to pay Rs. 1.65 lakhs at any time, as per his convenience without any limitation. Learned counsel for the appellant contended that there were circumstances available on record, which would disentitle the plaintiff for the relief of specific performance. The circumstances urged are that the vendors would stand deprived of a substantial part of the sale consideration because of the uncertainty of the payment of unearned increase. This construction would be unjust and unfair and the discretion under the Specific Relief Act ought not to be exercised in favor of the plaintiff. These aspects in effect mean either that the contract was incomplete or that it was vague and uncertain or that it was unconscionable. In either situation the equitable relief of specific performance cannot be granted. The vagueness and uncertainties render the contract void by virtue of Sections 20 and 29 of the Contract Act.

12. It was then urged that the plaintiff had committed fundamental breach since as per the receipt the next step was payment of Rs. 1.65 lakhs by the plaintiff to defendant No. 6. This was a fundamental term. It constituted more than 60% of the total price and that soon after such payment, possession of the property was to be delivered. PW.2 acknowledged in his statement that the said sum of Rs. 1.65 lakhs was to be paid within 10 days of the receipt i.e. by 29.12.1976. Admittedly, the said sum was not paid by the plaintiff to defendant No. 6. He did not even tender it in terms of the receipt. It is the plaintiff's own case that he insisted for possession of the property against the said payment of Rs. 1.65 lakhs. This was apparently in breach of the terms of receipt. The possession was to be delivered soon after receipt of the said payment of Rs. 1.65 lakhs. Soon after does not and cannot mean simultaneously as was sought to be contended by the plaintiff. A time gap was specifically stipulated in the receipt. Inter alia it was necessary to enable encashment of cheque/draft tendered by the vendee, as also to enable the defendants to clear the house of their goods and articles. The use of the words "soon after he pays" in the receipt by plain and simple interpretation requires that only after the sum of Rs. 1.65 lakhs is received i.e. on encashment of the relevant instrument of payment, will the obligation to deliver arise. "Soon after" implies that there shall be a reasonable gap of time between this receipt of money and the delivery of possession. At the relevant time defendant No. 6 was residing at Jaipur. As per the settled principle of law that the debtor must seek the creditor, ti was the plaintiff's obligation to pay defendant No. 6 at Jaipur. Admittedly, even when the plaintiff visited the defendant in jaipur he did not carry the draft with him.

13. With respect to payment by the plaintiff of the third Installment of Rs. 35,000/-, it was urged on behalf of the appellant that a time limit of 15 days was specified upon receipt of the L & D.O permission, but significantly, no similar time limit was prescribed for delivery of possession after payment of Rs. 1.65 lacs. In fact this was left to the discretion of defendant No. 6 to be done in a reasonable time. In these circumstances, it was necessary for the plaintiff to first tender the amount of Rs. 1.65 lakhs. It was not open for the plaintiff to insist for possession.

14. It was next contended that the plaintiff was not ready and willing to perform the contract. The lack of readiness and willingness of the plaintiff is clear by circumstances such as the plaintiff did not sue for specific performance in the first instance. The original plaint filed on 17.5.1997 claimed merely possession of the suit property against payment of only Rs. 1.65 lakhs. This is despite plaintiff's own understanding that the relief of specific performance was available to him, as is clear from plaintiff's notice dated 6.5.1977, which threatened that if the defendants did not deliver the property within 3 days he shall sue for specific performance. The plaint only alleged an offer of plaintiff to pay Rs. 1.65 lakhs to the defendants but made no averment of his financial readiness or willingness to perform the remaining terms of the receipt i.e. payment of Rs. 35,000/- after Land and Development Office's permission, execution/registration of sale deed and payment there against of Rs. 55,000/-. There is not even a whisper in the plaint with respect to the said obligation. In the amended plaint dated 17.12.1979 the allegation only is that the plaintiff was prepared to pay the amount and perform his part of the obligation. The said averment is again with respect to Rs. 1.65 lakhs and no case of readiness or willingness for the balance payment of Rs. 90,000/-. The plaintiff got prepared 4 days, prior to the filing of the suit, a bank draft in the sum only of Rs. 1,65 lakhs in an attempt to show his readiness. Significantly, the amount was not paid to the defendants and in fact not even tendered. Needless to add, the telegram and notice were sent and draft prepared just prior to filing the suit i.e. after 5 months complete silence.

15. It was also urged that the plaintiff did not sign the application and accompanying form necessary for L & DO permission, which are required to be signed by both the parties to the sale. The forms were furnished to the plaintiff on three occasion, firstly at the time of signing of the receipt, secondly in April 1977 and thirdly during the pendency of suit under cover of letter dated 19.6.1977. As per the plaintiff's own admission the said sum of Rs. 1.65 lakhs was payable within 10 days of the receipt. The plaintiff has not lead any evidence to show that during the said period of 10 days he had the financial capacity to pay the said money. In the absence of any evidence adverse inference must be drawn that the plaintiff did not have the requisite money during the said period. Reliance in this behalf is placed upon a judgment of Supreme Court in N.P. Thirugnanam (dead) by Lrs. v. Dr. R. Jagan Mohan Rao and Ors. ,

16. It was urged that the plaintiff did not lead any evidence to substantiate his personal financial capacity to pay the sale price. On the contrary, he sought to prove the bank account of M/s. Padam Singh Jain & Co., a partnership firm in which the plaintiff has merely 20% share. Even the statement of account of the said firm does not make out that the said firm had at its disposal moneys equivalent to Rs. 2.55 lakhs to complete the transaction. Also the account statement does not bear out the moneys available to the firm at the three points of time relevant for the transaction. In May, 1977 the plaintiff purchased another property of plot area 262 sq. yards in the neighborhood of the suit property for Rs. 1.80 lakhs. This was cheaper than the bargain with the defendants and for this reason the plaintiff was unwilling to complete the present transaction. As per receipt, the sale price was Rs. 2.65 lakhs. However, thereafter the plaintiff wanted to pay Rs. 65,000/- in cash. This was objected to by the defendants. The plaintiff has not contested the said statement of defendant No. 6 and has not put any suggestion to the said witness that they did not insist on payment of Rs. 65,000/- in cash. PW.2 has admitted sending the draft agreement, which records consideration merely of Rs. 2.00 lakhs as against sale price as per receipt of Rs. 2.65 lakhs.

17. Learned counsel for the appellant further contended that irrespective of the fact that agreement to sell has been duly proved and that the plaintiff was still ready and willing to perform his part of the contract and had always been ready and willing to perform his part of the contract, still discretion need not be exercised by the Court for which there is enough material and circumstances on record, which deserves to be taken note of and this relief be denied to the plaintiff. It was urged that this is not a fit case where the Court will grant the relief of specific performance. The performance of the contract would involve extreme hardships to the defendants whereas its non-performance would involve no such hardship to the plaintiff. It is inequitable to enforce specific performance of the receipt. Inter alia, it was urged that:-

(a) The plaintiff came to Court with a false case. In an attempt to substantiate it he set up 4 concocted letters. The said letters are fabricated is clear from the fact that they are not referred to in the original plaint filed on 17.5.1977; they are not referred to in the amended plaint filed on 17.12.1979; they are filed on 18.9.1980 i.e. more than 3 years after the filing of the plaint; the said letters are not referred to either in the plaintiff's telegram dated 4.5.1977 nor in the notice dated 6.5.1977; they are all purported to be sent under UPC; and the UPC for each of the 4 letters is of GPO at Kashmere Gate, Delhi while the plaintiff resides at Rohtak Road, almost 10 Kms. away.

(b) There has been an astronomical increase in the valued of the property. The value of the property today is approximately Rs. 2 crores i.e. more than 75 times the price of Rs. 2.65 lakhs in the receipt. The defendants have received a mere Rs. 10,000/- constituting less than 4% of the sale price. Reliance in this behalf is placed upon judgments of the Supreme Court of India in K. Narendra v. Riviera Apartments (P) Ltd. and Kanshi Ram v. Om Prakash Jawal and Ors. .

(c) The suit property is owned by five co-owners having need thereto. On the contrary, the plaintiff has after the agreement purchased alternative property for a lesser price in close vicinity of the suit property and his need has been met. Probably the plaintiff had entered into the transaction only for speculative purpose.

(d) The plaintiff has himself claimed the alternate relief of damages. Therefore, even as per him the said relief shall satisfy his claim. The appellants have no objection to the grant of the said alternate relief.

(e) Sharp contradiction between the plaint and plaintiff's oral testimony establishes that he is untrustworthy. The case set up by him is false. Such a person does not deserve the discretionary relief of specific performance. Reliance in this behalf is placed upon judgments of Supreme Court in Lourdu Mari David and Ors. v. Louis Chinnaya Arogiaswamy and Ors. ; Ram Kumar Agarwal v. Thawar Das and Ajaib Singh and Ors. v. Tulsi Devi (Smt.) .

On behalf of the appellants another point was taken i.e. bar of Section 9 and 31 of the Foreign Exchange Regulation Act, 1973 to the suit of the plaintiff but this point was given up during the course of arguments.

18. In order to meet the aforementioned submissions, learned counsel for the plaintiff/respondent made a reference in detail to the pleadings as well as oral and documentary evidence on record and urged that the document dated 19.12.1976 gives complete sequence of the performance of the contract by both the parties from the date of its execution till the registration of the sale deed in clear and unambiguous terms. The document nowhere contemplates execution of any further agreement to sell between the parties, before the execution of the sale deed before the Sub Registrar, Delhi. It is not permissible to read terms into an agreement specifically evidenced in a written contract. The case sought to be made out by the appellant regarding some other alleged terms of the sale viz. unearned increase payable to L&DO, liability of House tax, specific time for payment of Rs. 1,65,000/- have not even been pleaded in the written statement. In the absence of pleadings in the written statement the defendants cannot prove the same by oral or documentary evidence much less plead the same at the appellate stage. The reference of the defendants to certain portions of the plaintiff's evidence in cross examination as to the understanding of the document dated 19.12.1976 can be of no consequence when the said document itself has been admitted by the defendants in its entirety. It is not the case of the defendants in their written statement that some more terms had to be agreed upon. Mere assertion that the said contract was "uncrystalized" has no legal meaning. None of the owners of the property entered into correspondence with the plaintiff at any stage denying the agreement to sell. They have not even entered the witness box to prove their case pleaded in the written statement. Defendant No. 6 has been examined on oath by the local commissioner appointed by the Court. In his statement he has not stated that he is giving the evidence as power of attorney holder of Mr. S.K. Widhani. As a matter of fact in the written statement he has claimed that the power of attorney in his favor has become invalid upon Mr. S.K. Widhani's getting the citizenship of West Germany. He has made many statements contrary to what has been stated in written statement. In any event when the owners of the property chose not to enter the witness box to prove their case, the statement of Mr. G.D. Widhani cannot improve their case. The receipt of the telegram and the legal notice by the defendants is an admitted fact. There is no averment even in the written statement that the contents of the two are wrong. Learned Single Judge has rightly believed the four letters written by the plaintiff and the UPC receipts thereof. The plaintiff and PW 3 were not cross-examined about these four letters during their evidence. Regarding the four letters written by Mr. G.D. Widhani the same have been rightly disbelieved and held to be fabricated. Even otherwise Mr. G.D. Widhani as per the agreement between the parties dated 19.12.76 was assigned limited role of receiving the money till the execution of the sale deed in three Installments. The owners of the property have not assigned any other power to him to interact with the plaintiff purchaser.

19. It was further submitted by learned counsel for the plaintiff/respondent that the contention of the defendants that there was fundamental breach by the plaintiff is based on misreading of the agreement to sell dated 19.12.76 that every purchaser, if as per the terms of the contract being entitled to get the possession soon after making the payment, is naturally inclined to know from the seller as to when he would get the possession agreed to be given soon after payment. The lay persons understanding of a term of the contract by a party will not change the plain and simple language of the said term. Merely asking about the expected schedule cannot amount to a breach of the term that possession will follow payment. In any case this is not even remotely a case of fundamental breach or a breach where time is not the essence.

20. It was next contended by Mr. Khurshid that it is wrong to suggest that the plaintiff was not ready or willing to perform the contract. The plaintiff has placed on record ample evidence that he was always ready and willing to pay a sum of Rs. 1,65,000/- and get the possession as also to pay the further two Installment as per the agreement to sell dated 19.12.1976. Even the bank draft for an amount of Rs. 1,65,000/- was procured from the bank on 13.5.1977. The amount of Rs. 2 lacs remained deposited in a fixed deposit all through the pendency of the suit before the Court and after the suit was decreed, as per the directions of the Court full amount of Rs. 2,65,000/- was deposited in the Court. Admittedly, the plaintiff had gone to meet defendant No. 6 even at Jaipur requiring the defendants to indicate intention or steps to perform their part of contract. Defendants 1 to 5 i.e. the owners of the property have not placed on record any evidence to show that at any point of time they had taken any steps to hand over vacant possession of the premises to the plaintiff.

21. It was further urged that the judgment of the Supreme Court in the case of Ganesh Shet's case (supra) does not in any manner support the case of the defendants. The question in that case was that when the parties have led evidence in regard to a contract not pleaded in the evidence relief cannot be granted on the basis of evidence. The case pleaded by the plaintiff/respondent herein has been duly proved. The learned Single Judge has recorded a clear finding of fact that the contract which was pleaded has been duly proved. On the contrary the defendants are trying to plead a case, which was not pleaded in their written statement, nor proved by the owners of the property by entering the witness box. The case therefore has no applicability to the present case. The other decisions relied upon by the defendants i.e. Lourdu Mari David's case and Ram Kumar Aggarwal's case (supra) on the point of the party must come to the court with clean hands in fact squarely applies to the defendants conduct.

22. Learned counsel for the respondents urged that the submission of the plaintiff that the decree of the specific performance is an equitable relief and the same should not be granted to the plaintiff in the present circumstances has to be rejected. Defendants 1 to 5, the owners of the property having had not even entered the witness box to prove their case cannot ask for equity being in their favor. Two of the defendants are admittedly living abroad, two of them are settled in Jaipur having lucerative printing press business and one of them having a palatial house in Asiad Village, New Delhi, their father (Def. No. 6) having expired in the year 1995, there cannot be any equity in favor of the defendants merely because the prices of the property have increased. If increases in the price of the property has to be a criteria for denying relief of specific performance in that even in the present judicial process which takes considerable time in deciding matters i.e. 10 to 20 years, no purchaser will even be able to get specific performance. Such a proposition of law will therefore, be against the public policy of the justice system as also the basic jurisprudence. As such the two decisions relied upon i.e. K. Narendra's case and Kaushi Ram's case (supra) also do not apply to the facts and circumstances of the present case.

23. Before proceeding further, we may quote the receipt dated 19.12.1976, which had been proved on record as Ex.PW.2/1 with its copy as Ex.DW.1/1. Due execution of this document is not disputed by the parties. It reads:-

"Exhibit DW1/1

19.12.76

59, BABAR ROAD; NEW DELHI-1

Received a sum of Rs. 10,000.00 (Rupees ten thousand) in cash from Shri Ajit Parshad Jain S/o Shri Ratan Lal Jain, resident of H-C/6, New Rohtak Road, New Delhi as earnest money against proposed sale of the house 59, Babar Road, New Delhi, measuring 289 sq. yards. This house is the sole property in the joint names of (1) Shri N.K. Widhani (2) Shri K.K. Widhani (3) Shri P.K. Widhani (4) Shri S.K. Widhani and (5) Shri Naresh Kumar Widhani sons of G.D. Widhani and this property is free from any lien, charges and encumbrances. The sale price of the said house has been settled at Rs. 2,65,000.00 (Rs. two lakhs and sixty five thousand only). This sale is subject to permission of the Land and Development Officer, New Delhi.

We undertake to give possession (vacant) of the said house of Shri Ajit Prasad Jain soon after he pays the sum of Rs. 1,65,000.00 (Rupees one lakh sixty five thousand only) to Shri G.D. Widhani on our behalf. The balance shall be paid in two Installments to Shri G.D. Widhani first of Rs. 35,000.00 (Rs. thirty five thousand) within 15 days of the date on which the permission of Land and Development Officer, New Delhi is communicated to Mr. Ajit Prasad Jain by Shri G.D. Widhani on our behalf and second Installment of the balance of Rs. 55,000.00 (Rs. fifty five thousand) at the time of Registration of the sale deed before the Sub Registrar, Delhi/New Delhi.

 (N.K. Widhani)    (K.K. Widhani)
 

(P.K. Widhani)
 

(G.D. Widhani Attorney for S.K. Widhani)
 

NARESH KUMAR WIDHANI
 

.....
 

EXHIBIT DW1/A
 

The receipt as on reverse received by me and also Rs. 10,000.00 in cash has been paid by me.
 

Admitted  
Sd/-Illegible 
 14.10.77
 

Padam Singh Jain 
 Sd/- 21.12.76 
 41, Y.B. Road, Delhi-6" 
 

24. A bare reading of the documents would suggest that it contains the necessary terms of the transaction for property with clarity. Total sale consideration of Rs. 2,65,000/- payable, the stages at which the amount had to be paid are described in unambigious terms making it clear that the transaction is subject to the permission of the Land and Development Officer, New Delhi. The defendants agreed to hand over vacant possession of the property to Ajit Prasad Jain "soon after he pays the sum of Rs. 1,65,000/-" to defendant No. 1 on their behalf. Balance amount was agreed to be paid in two Installments. Dates and time are also clearly specified therein. First Installment of Rs. 35,000/- was payable within 15 days of the date on which permission of Land and Development Officer is communicated to the plaintiff by defendant No. 6 on behalf of defendants 1 to 5 and the second Installment of Rs. 55,000/- at the time of registration of the sale deed before the Sub Registrar. Admittedly, this receipt was signed on behalf of defendants 1 to 6 by defendant No. 6 on 19.12.1976. In terms of this agreement Rs. 10,000/- was received in cash by defendant No. 6 from Padam Singh Jain, PW.3, who paid this amount for and on behalf of Ajit Prasad Jain, who is the person mentioned in the agreement to be the purchaser. The submission on behalf of the appellants that there is uncertainty in this document has no force. This document gives complete sequence in which the contract was to be performed by both the parties from the date of its execution till registration of the sale deed. Nowhere the document stipulated for another execution of an agreement to sell between the parties or for any other agreement prior to the execution of sale deed. Document Ex.DW.1/1 is not such an agreement of contract, which is referred to in Section 14 of the Specific Relief Act, which cannot be specifically enforced.

25. The circumstances highlighted on behalf of the appellant, on the basis of which it is urged that it is not a concluded document are that the document does not appoint liability for payment of unearned increase or that it does appoint liability for payment of property taxes or no specific time was appointed for payment of Rs. 1,65,000/-. These three circumstances alone will not make this document to be an uncertain document. The time mentioned for delivery of possession by the defendants to the plaintiff is soon after the plaintiff makes payment of Rs. 1,65,000/- to the defendants. From the statements of plaintiff appearing as PW.2 and of defendant No. 6, it becomes abundantly clear that defendant No. 6 had assured the plaintiff that he would be coming to Delhi within next about 10 days by which time he would remove the goods and other household effects in order to enable him to deliver physical vacant possession to the plaintiff. The plaintiff did state that no time was fixed for payment of Rs. 1,65,000/- and defendant No. 6 has told him that this amount of Rs. 1,65,000/- cold be paid whenever the plaintiff would like and further told the plaintiff that he would be coming after 10 days from Jaipur to receive the money. There was, however, no firm commitment on this point. It was defendant No. 6 who was to come to the plaintiff's shop to receive the money. There was no uncertainty in so far as the payment of the amount is concerned.

26. The second aspect is the non-mentioning of the liability to pay the property taxes. In case it is not so mentioned in the agreement, the agreement cannot be said to be uncertain. Liability to pay property tax is regulated by the law applicable, namely, it is the occupier who is liable to pay the property tax under Delhi Municipal Corporation Act. Obviously on and from the date of delivery of possession, the liability to pay tax would be that of the plaintiff. In the agreement nothing is mentioned about payment of the unearned increase. What can be gathered from the material on record is that the liability to pay unearned increase was that of the defendants. However, non-mentioning of the liability to pay unearned increase would not make any difference. It was not the aspect, which was projected by the defendants in their written statement. Non-mentioning of these three matters will not make the agreement to sell as uncertain document. Sale has been defined in Section 54 of the Transfer of Property Act to be a transfer of ownership in exchange for a price paid or promised or part paid and part promised. For an agreement of sale there are two essential ingredients i.e. agreement to sell a definite property in exchange for a price paid or promised to be paid or part paid. The document Ex.DW.1/1 is thus neither uncertain nor vague. Nothing makes this document uncertain much less the three circumstances.

27. As regards the plea on behalf of the appellants about the plaintiff's being not ready and willing to perform his part of the contract, we will point out that the plaintiff had made necessary averments in the plaint about his readiness and willingness to perform the agreement. It was stated in the plaint that the plaintiff was always prepared and is even now prepared to pay the amount and perform his part of the obligation under the agreement to sell. This averment was not specifically denied by the defendants in the written statement except by making a bald statement that this para is incorrect. Such a vague denial is not acceptable in law. In any case evidence was led on this point by the plaintiff, who appeared as PW.2 and stated about his financial means and about his readiness and willingness, which statement was also not challenged in cross examination.

28. In His Holiness Acharya Swami Ganesh Dessji v. Shri Sita Ram Thapar it has been held that there is no 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 to perform his part of the contract, the conduct has to be properly scrutinised. The factum of readiness and willingness to perform plaintiff's part of the contract is to be adjudged with reference to the plaintiff's conduct and the attending circumstances. One of the circumstance brought to our notice on behalf of the appellants was that the plaintiff was not ready and willing since he did not sought a decree for specific performance of the agreement in the first instance. Original plaint was filed in May, 1977 wherein only decree for possession was claimed on payment of Rs. 1,65,000/-. Decree for specific performance was subsequently sought on amendment of the plaint. This fact alone will not be sufficient to infer that the plaintiff was not ready and willing to perform his part of the contract. What was required of the plaintiff in the first instance was to make payment of Rs. 1,65,000/-. The next obligation was on the part of the defendants to deliver possession. The defendants had to apply for permission of the Land and Development Office thereafter. Next obligation on the part of the plaintiff was to make/payment of Rs. 35,000/- within 15 days of the receipt of intimation from the defendants about grant of permission. The plaintiff filed original suit on the plea that under the terms of the agreement he was ready with the amount of Rs. 1,65,000/-. Defendants were asked to deliver possession to him. The fact that the plaintiff did not pray for specific performance of the entire contract at that stage will not come in his way to claim the relief of specific performance later on which relief he sought amendment to adjudge that the plaintiff was ready and willing to perform his part of the contract and is still ready and willing the Court is entitled to take into consideration and must take into consideration the conduct of the plaintiff prior to and subsequent to the filing of the suit. Availability of the amount of consideration, which he had to pay to the defendants must be proved right from the date of the execution of the agreement to sell till the date of recording of evidence and thereafter. He must prove that he is ready and has always been willing to perform his part of the contract. No questions were put to the plaintiff when he appeared in the witness box to the statement, which he had made that he was always ready with the amount, which was lying deposited in the partnership account within the prescribed period of limitation.

29. In Moti Lal Jain v. Smt. Ramdasi Devi and Ors. the aspects of delay, which are relevant in a case of specific performance of contract for sale of immovable property have been noticed as: (i) delay running beyond the period prescribed under the Limitation Act; (ii) delay in cases where though the suits are within the period of limitation, yet due to delay the third parties have acquired rights in the subject matter of suit or in the facts and circumstances of the case, delay may give rise to plea of waiver or otherwise it will be inequitable to grant a discretionary relief.

30. In the instance case, none of the circumstances exists. Amendment was sought within the period of limitation. Therefore, on the day the amended plaint was filed, the suit for grant of decree for specific performance was within the period of limitation. No third party interest had accrued in between and no circumstance was urged or brought to our notice that the delay has given rise to a plea of waiver or otherwise. Learned Single Judge rightly observed that the defendants, after the plaintiff filed suit had been trying to wriggle out of the contract, in view of the rise in prices of real estate, which fact was also highlighted by the appellant during the pendency of the suit that property is now worth crores of rupees. This delay in disposal of the proceedings in a suit is not sufficient to disentitle the plaintiff a decree for specific performance, to which the plaintiff is otherwise entitled to.

Another aspect, which may be noticed, is that the time was not made essence of the contract. Otherwise also in case of sale of immovable property there is no presumption as to the time being essence of the contract. In Smt. Chand Rani (dead) by L.Rs. v. Smt. Kamal Rani (dead) by L.Rs. it was held that in the case of sale of immovable property there is no presumption as to the time being the essence of the contract. Even if it is not of the essence of the contract, the Court may infer that it is to be performed in a reasonable time if the conditions are: (1) from the express terms of the contract; (2) from the nature of the property; and (3) from the surrounding circumstances, for example the object of making the contract. Such conditions have not been proved on record by the appellants. The law of equity, which governs the rights of the parties, in cases of specific performance of contracts to sell read estate, looks not at the letter but at the substance of the agreement. It was further held in Chand Rani's case (supra) that Section 55 of the Contract Act which deals with the consequences of failure to perform an executory contract at or before the stipulated time provides by the first paragraph:

"When a party to a contract promises to do a certain thing at or before a specified time, or certain things at or before specified times, and fails to do any such thing at or before the specified time, the contract, or so much of it as has not been performed, becomes voidable at the option of the promiseif the intention of the parties was that time should be of the essence of the contract."

31. It is not merely because of specification of time at or before which the thing to be done under the contract is promised to be done and default in compliance therewith, that the other party may avoid the contract. Such an option arises only if it is intended by the parties that time is of the essence of the contract. Intention to make time of the essence, if expressed in writing, must be in language which is unmistakable; it may also be inferred from the nature of the property agreed to be sold, conduct of the parties and the surrounding circumstances at or before the contract. Specific performance of a contract will ordinarily be granted, notwithstanding default in carrying out the contract within the specified period, if having regard to the express stipulations of the parties, nature of the property and the surrounding circumstances, it is not inequitable to grant the relief. If the contract relates to sale of immovable property, it would normally be presumed that time was not of the essence of the contract. Mere incorporation in the written agreement of a clause imposing penalty, in case of default also does not by itself is evidence an intention to make the essence.

32. In Smt. Indira Kaur and Ors. v. Shri Sheo Lal Kapoor the plaintiff in his evidence had stated that he had deposited sum more than the sale consideration in his bank. Defendant neither enquired nor asked the Court to have the bank pass book produced in Court. In these circumstances, it was held that adverse inference on account of non-production of the pass book cannot be drawn against the plaintiff. In the instant case the plaintiff's statement that sufficient fund was always available in the partnership account, as per the statement of account produced, no suggestion to the contrary was given in cross examination.

33. Reliance on behalf of the appellant on the decision in K. Narendra v. Riviera Apartments is misconceived since in the said decision compensation in lieu of decree for specific performance was granted when the Supreme Court held that the agreement on the facts had become incapable of performance, only part of the price had been paid and the appellant had parted with only a small portion of the land. There had been default on the part of the respondents in performing their obligations under the contract. It was on evaluation of the totality of the circumstances and opinion was formed by the Supreme Court that the performance of the contract would involve such hardship on the appellant as it did not forsee. Assessing such comparative hardship, decree for specific performance was not allowed, instead compensation was awarded. In the instance case, hardship was never pleaded.

34. Circumstances now tried to be projected are such, which are disputed and cannot be taken note of, in the absence of any pleading or evidence in that behalf. None of the defendants had stepped in the witness box. Defendant No. 6 had been examined on oath by Local Commissioner. His statement was also contrary to what had been pleaded in the written statement. The appellants did not deny the receipt of telegram and of the legal notice served by the plaintiff before institution of the suit. The very fact that in the suit for specific performance alternate relief for damages has been claimed will not prevent the Court in awarding appropriate reliefs to the plaintiff, which he is otherwise entitled to. Even in such cases when a clause in the contract provide that in case of violation of the terms and conditions of the agreement, the plaintiff is entitled to recover damages, the same has been held to be a penalty clause only for the purpose of securing performance of the contract and not for the purpose of giving an option to the Court of awarding money decree in lieu of specific performance.

35. In Manzoor Ahmed Magray v. Gulam Hassan Aram and Ors. it was held that if any party violates the terms and conditions of the agreement, he would be liable to pay damages, which would not mean that the contract is not to be performed. It would only mean that if there is breach of some terms and conditions of the contract, the defaulting party has to pay the penalty specified therein. The said clause also does not provide that in case a sale deed is not executed, damages are to be awarded. Nothing was brought to our notice that anywhere in the agreement it was stipulated that the party to the agreement will have the option either to fulfilll the contract or to buy or sell or to pay liquidated damages or penalty. Terms of the agreement are clear and unambiguous saying that the sale consideration is to be paid after adjustment of Rs. 10,000/- paid in advance, in three Installments. Agreement nowhere provides for damages. As per requirement of law, the plaintiff has to make a prayer in the alternative for payment of damages. See Section 21 of the Specific Relief Act. But making such a prayer in the alternative alone will be not sufficient to disentitle the plaintiff to the relief of specific performance prayed for as the primary relief.

36. There is nothing wrong in the learned Single Judge observing that the defendants/appellants have tried to manufactured evidence i.e. the four letters alleged to have been sent on behalf of the defendants to the plaintiff. Evidence of the defendants to that extent has rightly been disbelieved. In so far as plaintiff's evidence is concerned, learned Single Judge did observe that circumstances on record do not suggest that the letters sent by the plaintiff to the defendants are not fabricated. The mere fact that there is no mention made of these letters either in the plaint or in the first telegram or in the legal notice will not lead to an inference that the same are fabricated in as much as no objection was raised on behalf of the defendants when copies of these letters were proved. Nobody appeared on behalf of the defendants to deny the fact that the said letters were not received by them. No questions were put to the plaintiff that these were fabricated.

37. The plaintiff did prove due execution of the agreement, that he was always ready and willing to perform his part of the contract and had always been ready and willing to perform his part of the contract. In fact the defendants tried to wriggle out of the contract, after knowing fully well that prices were on increase. There is nothing wrong in the judgment of the learned Single Judge decreeing the suit of the plaintiff. No case for hardship is made out. However, taking note of the fact that decree prayed for if allowed to remain as it is might cause some hardship to the defendants/appellants since L&DO charges will have to be paid by them, we are inclined to modify the decree to meet that hardship of the defendants/appellants by directing the plaintiff/respondent to pay in addition to the amount, as stipulated in the decree of learned Single Judge a further amount, which would be payable as an unearned increase on grant of the requisite sanction (permission to sell the property) by the Land and Development Office. Such amount will be paid/deposited by the plaintiff/respondent within a period of 15 days from the date of receipt of intimation from the Land and Development Office, namely, on communication of the said sanction to the plaintiff/respondent.

38. Appeal accordingly is dismissed. However, decree of the trial court is modified to the extent aforementioned. Parties are left to bear their respective costs.