M/S Krishna Sweet House vs Shri Gurbhej Singh @ Happy And Ors.
2012 Latest Caselaw 2811 Del

*            IN THE HIGH COURT OF DELHI AT NEW DELHI


+                           RFA No. 421/2003


%                                                              30th April, 2012


M/S KRISHNA SWEET HOUSE                                         ..... Appellant
                  Through :              Mr. Rajat Aneja, Advocate.


                   versus

SHRI GURBHEJ SINGH @ HAPPY AND ORS.              ..... Respondents
                  Through : Mr. Harish Malhotra, Sr. Advocate
                            with Mr. M.G. Vacher, Advocate for
                            Respt. Nos. 3 and 4.


CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA

To be referred to the Reporter or not?                            Yes.




VALMIKI J. MEHTA, J. (ORAL)

1. The challenge by means of this Regular First Appeal (RFA) filed under

Section 96 of Code of Civil Procedure, 1908 (CPC) is to the impugned

judgment of the trial Court dated 27.2.2003 dismissing the suit filed by the

appellant/plaintiff for specific performance of an agreement to sell dated

16.10.1993 with respect to the property being front portion of house No. H-

4/7, Model Town, Delhi-110009. Prayer was also made for cancelling of the

sale deed executed by the original owners/defendant Nos.1 and 2 in favour of

the defendant Nos.3 and 4/respondent Nos. 3 and 4/subsequent purchasers. It

is relevant to note that the appellant/plaintiff was a tenant in a shop in the

ground floor portion forming part of the property comprised in the agreement

to sell, and from where the appellant/plaintiff runs the business of a sweet

shop.

2. The facts of the case are that the appellant/plaintiff pleaded that the

parties had entered into an agreement to sell of the suit property, vide a

receipt-cum-agreement dated 16.10.1993. The total sale consideration was

fixed at `4,70,000/-, of which the appellant/plaintiff states to have paid an

amount of `10,000/- on the date of the agreement to sell. The original

seller/defendant No.1-Sh. Hardit Singh and his wife-Smt. Inder

Kaur/defendant No.2 expired during the pendency of the suit and were,

thereafter, represented by their legal heirs. (For the sake of convenience, in

this judgment, I am referring to the original proposed sellers as defendant

Nos. 1 and 2.) The balance amount was stated to be payable as per the

receipt-cum-agreement dated 16.10.1993 on respondent Nos.1 and

2/defendant Nos. 1 and 2/proposed sellers intimating to the plaintiff/proposed

buyer of having obtained clearance from the income tax authorities. The

receipt-cum-agreement to sell was signed only by defendant No.1/husband

and not defendant No.2/Smt.Inder Kaur/wife. In the receipt-cum-agreement

dated 16.10.1993 it was mentioned that defendant No.1 was fully competent

to sell the same. The case of the appellant/plaintiff was further that defendant

No.1 in January, 1995 asked for further payment and, therefore, on 4.1.1995

an amount of `50,000/- was paid in cash to defendant No.1, and to evidence

which defendant No.1 executed a receipt, not only acknowledging the amount

of `50,000/-, but also the agreement to sell contained in the previous receipt-

cum-agreement dated 16.10.1993. The appellant filed the subject suit in

December, 1995 alleging breach on the part of the defendant Nos. 1 and 2

because defendant Nos.1 and 2 wanted to receive the balance amount of

consideration in cash, to avoid payment of income tax, and which was not

agreeable to the appellant/plaintiff.

3. The defendant Nos. 1 and 2 contested the suit and denied that an

agreement to sell was ever entered into between the parties. It was pleaded by

defendant Nos. 1 and 2 that the signatures of defendant No. 1 were forged,

and possibly copied from the lease agreement entered into between the

parties. It was pleaded that in any case defendant No.2/wife of defendant

No.1-Smt. Inder Kaur being not a party to the agreement to sell, no suit for

specific performance would lie. Defendant Nos. 1 and 2 pleaded malafides on

the part of the appellant/plaintiff in not suing the subsequent purchasers as

parties to the suit, although, to the knowledge of appellant/plaintiff, the suit

property, around six months prior to filing of the suit, had already been sold

to two persons, namely, Sh. Pradeep Arora and Sh. Ashmeet Singh(defendant

Nos.3 and 4) by means of a registered sale deed on 17.5.1995. The fact of

this sale had been duly brought to the notice of the appellant/plaintiff through

a notice dated 17.5.1995. At this stage, it may be stated that it is only after

the filing of the suit, and on objection being taken by the defendant Nos. 1

and 2, that the necessary parties being the subsequent purchasers were not

made parties, the subsequent purchasers were added as defendant Nos. 3 and

4 in the suit.

4. After the pleadings were complete, the trial Court framed the following

issues:-

"(i) Whether defendant No. 1 prior to his death had entered into an agreement of sale with the plaintiff to sell his property bearing No. H-4/7, Model Town-II, Delhi - 110009 and had received Rs.60,000/- as part sale consideration vide two receipts dated 16.10.93 for Rs.10,000/- and receipt dated 4.1.1995 for Rs.50,000/- from the plaintiff as alleged in the plaint? OPP

(ii) Whether the receipts dated 16.10.1993 for Rs.10,000/- and dated 4.1.1995 for Rs.50,000/- alleged to had been executed by defendant No. 1 in favour of the plaintiff, are forged and fabricated as alleged in the

written statement of defendant No. 1 and 2? OPD

(iii) Whether defendants No. 3 and 4 are the bonafide purchasers of the suit property excluding the terrace rights thereon alleged to had been purchased by them from defendants No. 1 and 2 for consideration vide duly registered sale deed in their favour dated 17.5.1995? OPD

(iv) Whether the plaintiff is entitled to the relief in respect of the suit property claimed by it in the present suit? OPP

(v) Relief."

5. The trial Court while dealing with the issue Nos. 1 and 2 has come to a

finding that the receipts dated 16.10.1993 and 4.1.1995, Ex. PW1/3 and

PW1/2A are not proved as the originals of the same were not filed on record.

The trial Court held that the receipts were not proved because no efforts were

made by the plaintiff to seek permission of the Court to lead secondary

evidence with respect to the receipts dated 16.10.1993 and 4.1.1995. Trial

Court has also made pertinent observations with regard to the fact that no

independent witnesses have been examined by the appellant/plaintiff to prove

the execution of receipts. Trial Court has also referred to the fact that though

there may be a statement, Ex.PW2/2 recorded of the partner of the

appellant/plaintiff-Sh. Chhanga Mal Gupta before the Income Tax Officer,

which may seem to suggest the existence of originals, however, the said

statement exhibited as Ex.PW2/2 was held not to have been proved on record.

Trial Court has also disbelieved the transaction between the parties as an

agreement to sell, inasmuch as, an amount of `10,000/-which was stated to

have been paid by cheque under the agreement to sell to defendant Nos. 1 and

2 by the appellant/plaintiff was found to have been returned by a cheque

Ex.PW1/DX1 of the defendant No. 1 to the appellant/plaintiff, and the reverse

of which cheque contained a noting that the cheque was being issued for

return of the loan of `10,000/-, the amount which was mentioned in the

agreement to sell/ receipt dated 16.10.1993 being the alleged advance price

paid out of the total price of `4,70,000/-. The original cheque, Ex.PW1/DX1,

issued by defendant No. 1 in favour of the appellant/plaintiff was produced

from the custody of defendant No.1, inasmuch as, it was proved that the

cheque was returned to defendant No.1 after payment of an amount of

`10,000/- in cash to the appellant/plaintiff by defendant No.1.

6. The trial Court has held that another reason that there did not exist

contract for sale of property was because when the appellant/plaintiff filed the

suit for permanent injunction in March, 1995 for the alleged illegal

construction on the terrace forming part of the suit property, the

appellant/plaintiff described itself only as a tenant in the suit property, and in

the plaint no rights were claimed in the suit property under the so called

agreement to sell dated 16.10.1993 and the subsequent receipt dated 4.1.1995,

which otherwise it was natural for the appellant/plaintiff to allege because if

there existed an agreement to sell then the appellant/plaintiff would have

rights in the terrace pursuant to the agreement to sell. The plaint in the

injunction suit, claiming injunction against defendant Nos. 1 and 2 from

making any construction on terrace of the suit property was proved and

exhibited as Ex. DW2/2. So far as the aspect of readiness and willingness is

concerned, the trial Court held that the fixed deposit receipts (FDRs) which

were filed were only photocopies and hence not proved in accordance with

law. Ultimately, the trial Court has held that even if there was an agreement

to sell, on receipt back of the amount of `10,000/- by the appellant/plaintiff as

evidenced by the transaction qua the cheque, Ex.PW1/DX1, rights under the

agreement to sell came to an end. Trial Court has also held that the

appellant/plaintiff was not entitled to the discretionary relief of specific

performance inasmuch as in spite of knowledge the subsequent purchasers/

defendant Nos.3 and 4 were not initially made as parties to the suit and hence

appellant/plaintiff did not come to the Court with clean hands.

7. Some of the relevant observations of the trial Court giving the aforesaid

conclusions read as under:-

"9. ISSUE No. I & II

Both these issues are inter-related and so they are being taken up together. It is not the case of the plaintiff that any formal agreement to sell in receipt to the suit

property was reduced into writing. Plaintiff relies upon the photocopy of earnest money receipt dated 16.10.93 of Rs.10,000/- and another receipt dated 04.01.95 of Rs.50,000/- (said to be part payment) to prove the agreement between the parties regarding sale of the suit property by defendants No. 1 and 2 to the plaintiff. It is the case of the plaintiff that during the pendency of his suit, original earnest money receipts exbt. PW-1/3 and PW-1/2A were lost and NCR/report dated 06.08.98 exbt. PW-1/17 was lodged with the police post Tis Hazari, Delhi and a public notice regarding the loss of earnest money receipts was published in newspaper "National Herald" on 27.08.98 and the copy of the said notice has been placed on record as exbt. PW-1/19. The above- referred earnest money receipts are said to have been lost in August, 1998 and the evidence of the plaintiff has been recorded in January, 2003 only but no efforts have been made by the plaintiff to seek the permission of the court to lead secondary evidence in respect of earnest money receipts exbt. PW-1/3a nd PW-1/2A. Otherwise also, NCR report exbt. PW-1/17 and public notice exbt. PW- 1/19 have not been duly proved on record. Plaintiff has sought to establish the existence of originals of earnest money receipts exbt. PW-1/3 and PW-1/2A by getting examined Inspector, Mahesh Sharma, PW-2 from Income Tax Department and after going through the evidence of this witness. I find that he had not produced the originals of statement exbt. PW-2/2 of the partner of the plaintiff firm recorded under Section 131 of the Income Tax Act and this witness has admitted in cross-examination that he has not seen the original of statement exbt. PW-2/2, which is stated to be attested by Sh. R.K. Arora, Income Tax Officer. It is not proved on record as to by which Income Tax Officer, this statement exbt. PW-2/2 was recorded. Even Sh. R.K. Arora, Income Tax Officer, who is stated to have been attested this statement is not produced in evidence. This attested copy exbt. PW-2/2 has not been produced by Inspector, Mahesh Sharma, PW-2 and so, it cannot be said that this statement exbt.

PW-2/2 is duly proved on record. Plaintiff has relied upon the statement exbt. PW-2/2 to prove the existence of original earnest money receipts as in this statement exbt. PW-2/2, it is mentioned that original document (receipts) have been shown to you but it is not clear from this statement exbt. PW-2/2 as to who was the Income Tax Officer before whom original receipts were produced. Inspector, Mahesh Sharma, PW-2 has admitted in his cross-examination that he was not present at the time of recording of statement exbt. PW-2/2. The writer of receipts exbt. PW-2/2A and PW-1/3 has not been got examined by the plaintiff. Moreover, the address of defendants No. 1 and 2 as shown in receipt exbt. PW-1/3 is 2472, Hudson Line whereas, defendants No. 1 & 2 were residing in house No. 2452, Hudson Line as per document exbt. DW-1/1 when these receipts are purportedly issued. No independent witness has been got examined by the plaintiff to establish the veracity of execution of receipts exbt. PW-1/3 and PW-1/2A. All this creates serious doubt about execution of receipts exbt. PW-1/3 and PW-1/2A by defendant No.1.

XXX XXX XXX

12. In view of what is observed in para no :9 above, I hold that the existence of originals of earnest money receipts exbt. PW-1/3 and PW-1/2A does not stand proved on record. No secondary evidence has been led in terms of Section 63 of the Indian Evidence Act, 1872 to prove the copies of earnest money receipts exbt. PW-1/3 and PW-1/2A. Accordingly, I hold that the plaintiff has failed to prove the existence of any agreement to sell between the plaintiff and defendant No. 1 & 2 in respect to the suit property.

13. Since the original sale deed of the suit property has not been produced before the court by the plaintiff, it is to be seen whether there was any concluded agreement to sell of the suit property between the plaintiff and

defendants No. 1 & 2. According to the plaintiff, earnest money of Rs.10,000/- was paid to defendant No. 1 whereas according to the defendants No. 1 and 2, it was a friendly loan and it is so mentioned on the back side of cheque exbt. PW-1/DX1. It has come in evidence of the plaintiff that the cheque exbt. PW-1/DX1 is the same cheque which he had given to defendant No.1 and the said cheque had bounced on presentation and it was returned to the plaintiff (PW-1) by defendant No.1 after about one year when the plaintiff had asked defendant No.1 to either return the money or to complete the transaction. Plaintiff has categorically admitted in cross- examination that he had accepted Rs.10,000/- from defendant No.1 vide cheque and he (PW-1) had deposited the same with his banker for collection.

14. The abovesaid vital admission made by the plaintiff in his cross-examination clearly shows that the plaintiff had abandoned the alleged agreement/contract sale of suit property by accepting so called refund of earnest money amount of Rs.10,000/- and by depositing the same with his banker for collection. According to the plaintiff, this happened after about one year of the alleged deal with defendants No. 1 & 2. Part payment of Rs.50,000/- in cash vide recipt exbt. PW-1/2A is not duly proved on record and as per plaintiff‟s own admission, earnest money of Rs.10,000/- was returned to him by the defendant no. 1 and he accepted the cheque of Rs.10,000/-. Thus, I am of the considered opinion that there was no concluded contract of sale regarding the suit property between the plaintiff and defendants No. 1 & 2. It is evident from the original sale deed on record that the suit property was jointly owned by defendants No. 1 & 2. Plaintiff has failed to prove on record that the defendant No.1 had any authority or power of attorney from defendant No.2 to enter into any agreement to sell with the plaintiff. In taking the view that there was no concluded contract of sale of suit property between the plaintiff and defendant No. 1 & 2. I rely upon the plaint

exbt. DW-2/2 which was filed by the present plaintiff against defendant No.1 for permanent injunction and in the said plaint exbt. DW-2/2, plaintiff in March, 1995 had described himself as tenant of defendant No. 1 and 2 and in para -4 of the said plaint, present plaintiff had categorically stated that the plaintiff is regularly paying the rent to defendant No.1 and bank certificate to this effect was filed with the said plaint. Apart from this, plaintiff (PW-1) in his evidence has admitted that the plaintiff was a tenant at a rental of Rs.500/- per month in the suit property under defendant No. 1 & 2 and vide document exbt. PW-1/DX3, Rs.3,000/- was paid by him vide cheque to defendant No. 1 towards rent of the suit property on 16.10.93 and again vide cheque exbt. PW- 1/DX4 Rs.6600/- was paid by plaintiff to the defendant No.1 towards rent on 11.11.94.

XXX XXX XXX

20. In the present case, plaintiff had not called upon defendants No. 1 & 2 to obtain income tax clearance etc. by means of a notice and it is proved from the evidence of plaintiff (PW-1) that he had sought refund of advance money of specific performance and had accepted refund of Rs.10,000/- by means of a cheqye and he had presented the same to this banker for collection. Relief sought under Section 34 of the Specific Relief Act is a discretionary relief and to obtain this relief of specific performance of agreement to sell etc., plaintiff has to come to the court with clean hands. In the plaint initially filed by the plaintiff in the paragraph of cause of action, it is mentioned by the plaintiff that the defendant had sent letter dated 17.05.95 informing the plaintiff that they have sold the suit property to third party. A copy of the legal notice exbt. PW-1/14, sent by the plaintiff to defendant No. 1 prior to filing of the suit reveals that the copy of this legal notice was also sent to defendants No. 3 & 4 also but the plaintiff has filed to explain why defendants No. 3 & 4 were not impleaded as a party to

the suit filed by the plaintiff." (underlining added)

8. Before this Court, learned counsel for the parties argued the appeal

under the following heads:-

i) Whether an agreement to sell dated 16.10.1993 was entered into

between defendant Nos. 1 and 2 and the appellant/plaintiff with respect

to the suit property or the said documents are forged and fabricated

documents.

ii) If there existed an agreement to sell, whether the

appellant/plaintiff was guilty of breach of contract and not the

defendant Nos. 1 and 2 and, therefore, the appellant/plaintiff was not

entitled to the relief of specific performance.

iii) Even if there existed an agreement to sell, whether rights in the

same were given up on the receipt of an amount of `10,000/- by the

appellant/plaintiff vide transaction involving cheque of `10,000/-,

Ex.PW1/DX1.

iv) Whether the appellant/plaintiff was always ready and willing to

perform its part of the contract.

v) Whether the appellant/plaintiff is not entitled to the discretionary

relief of specific performance on the grounds that

(a) Only an insubstantial sum of `60,000/-, out of the total price

of `4,70,000/- was paid, and this aspect has to be taken with the

passage of time and thus it would be wholly inequitable to grant

specific performance considering the phenomenal rise in the

value of the property from 1995 till the decision in the suit and,

thereafter, during the pendency of this appeal,

(b) The agreement to sell dated 16.10.1993 and the subsequent

receipt dated 4.1.1995 are at best uncertain documents and on

such uncertain documents (originals of which has not been seen

till the date) discretionary relief cannot be granted for specific

performance; and

(c) Third party rights have come into existence, i.e. the suit

property has been sold to the defendant Nos. 3 and 4 and that too

around seven months prior to the filing of the suit. In this period

the appellant/plaintiff did nothing, although the

appellant/plaintiff was duly aware of the existence of the sale

transaction with respect to the suit property by defendant Nos. 1

and 2 in favour of defendant Nos. 3 and 4.

(vi) Whether the suit for specific performance does not lie because

admittedly no agreement was entered into between defendant No. 2 and

the appellant/plaintiff and, there is nothing proved on record that the

defendant No.1 was at any point of time the attorney of defendant

No.2/wife of defendant No.1.

9. Firstly, on the aspect as to whether there exists an agreement to sell

between the parties being receipt-cum-agreement to sell dated 16.10.1993.

The case of defendant Nos.1 and 2 is that the signatures of defendant No.1 on

the documents being receipts dated 16.10.1993 and 4.1.1995, Ex.PW1/3, and

Ex.PW1/2A are forged, and possibly copied from the lease deed entered into

between the parties. I have considered the totality of facts and circumstances

in the facts of the present case, including and especially in the light of the fact

that the case of the appellant/plaintiff itself was that the relationship between

the parties was indeed very cordial. After thinking and rethinking, I have

come to the conclusion that the appellant/plaintiff has failed to prove the

existence of any valid receipts dated 16.10.1993 and 4.1.1995, more

particularly because it is the appellant who was the plaintiff in the suit and the

onus of proof lies upon the appellant to prove the fact which it asserts. The

following are salient reasons which persuade me to hold that there does not

seem to have existed any valid agreement to sell between the parties:-

(I) (a) Except the factum of the receipts dated 16.10.1993 and

4.1.1995, there is absolutely no contemporaneous additional

evidence to support the case of the existence of the receipts and

that too for a sufficiently long period of one year and eight

months from October, 1993 to May, 1995.

(b) Admittedly there are no witnesses to this agreement to sell

and no evidence has been led by the appellant/plaintiff of the

receipts dated 16.10.1993 and 4.1.1995 having been executed in

the presence of any witnesses. Therefore, there are no witnesses

who have affirmed existence of the agreement to sell between

the parties.

(c) Further, there is also no correspondence at any point of

time from October, 1993 till the property was sold by the

defendant Nos.1 and 2 to the defendant Nos.3 and 4 in May,

1995 whereby it was affirmed by the appellant/plaintiff that there

was an agreement to sell between the parties as evidenced by the

receipts dated 16.10.1993 and 4.1.1995. Admittedly, there is not

a single letter or a notice sent by the appellant/plaintiff to the

defendant Nos.1 and 2 affirming the existence of the receipt and

the agreement to sell.

(d) No notice was given by the appellant/plaintiff to the

defendant Nos.1 and 2 to get the income tax clearance

certificate.

(e) In the suit for injunction filed by the appellant/plaintiff in

March, 1995 there is not even a whisper as to the existence of

the receipts/agreement to sell dated 16.10.1993 and 4.1.1995 and

therefore rights flowing to the appellant/plaintiff therefrom. To

avoid repetition para 6 above is reiterated.

(II) An important aspect which has weighed in my mind is that

surely it was not difficult for the appellant/plaintiff during trial to

have summoned admitted signatures of the defendant No.1 and

thereafter examined a hand writing expert to show that the

receipts dated 16.10.1993 and 4.1.1995 bore the signatures of the

defendant No.1. I am conscious of the fact that of course if both

the parties had led experts‟ evidence, both the experts would

have supported the respective cases of the parties who engaged

them, and the evidence of an expert is therefore only taken as

evidence in the case with substantial caveat, however, at least the

appellant/plaintiff could have made an effort, and which would

have shown that it was convinced that there existed genuine

receipts dated 16.10.1993 and 4.1.1995. Lack of proactive steps

as aforesaid by the appellant/plaintiff, in my opinion, clearly

goes against it. I may also state that there is an additional

handicap for the Court to decide genuineness of the receipts in

the facts of the present case, even assuming that there are no

reports of the handwriting experts of both the parties, inasmuch

as for no fault of the defendants/respondents the original receipts

are not on the judicial file because they are said to have been lost

by the appellant/plaintiff in the District Court premises (and for

which the appellant/plaintiff is said to have filed a police report

on 6.8.1998, Ex.PW1/17). Under Section 73 of the Evidence

Act, 1872 though a Court is empowered to compare the disputed

signatures with the admitted signatures of the executants, and

which the Courts do so warily if deemed fit in the facts of the

particular case, but, even that cannot be done in the present case

in the absence of the originals of the receipts as the same are not

on record. Therefore, the position which emerges is that there is

a contention of the defendant Nos.1 and 2 that the signatures of

the defendant No.1 on the receipts dated 16.10.1993 and

4.1.1995 are forged and there is no contemporaneous evidence

including correspondence affirming the existence of the receipts

for a long period of one year and eight months, no expert

evidence was sought to be relied upon by the appellant/plaintiff,

no other admitted signatures of the defendant No.1 were sought

to be summoned to compare the signatures on the receipts with

the admitted signatures, no independent witness existed to

depose qua the execution of the receipts, no mention of the

receipts was made by appellant/plaintiff in the injunction suit

filed in March, 1995, and therefore, I am of the opinion that

there is sufficient doubt cast on existence of the receipts dated

16.10.1993 and 4.1.1995, and in such nebulous state of facts

which have come on record, it is not possible for this Court to

hold that there existed genuine receipts dated 16.10.1993 and

4.1.1995.

(III) The final and a very important reason to hold that there was

never any agreement to sell, is that the receipt-cum-agreement to

sell dated 16.10.1993 talked of payment by cheque of `10,000/-

to the defendant No.1, and the defendants/respondents have led

sufficient evidence in the form of the cheque, Ex.PW1/DX1

which shows that really the so called amount of `10,000/-

received by the defendant No.1 was in fact a loan given by the

appellant/plaintiff to the defendant No.1 and which loan was

returned by means of the cheque, Ex.PW1/DX1. The cheque,

Ex.PW1/DX1 on its reverse contains a specific noting of having

been issued for return of the loan, and the appellant/plaintiff

during its evidence, has admitted this fact that this cheque was

issued for return of the loan of `10,000/- given by the

appellant/plaintiff to the defendant No.1. Since there is no other

evidence on record when this loan of `10,000/- was paid by the

appellant to the defendant No.1, and which the defendant No.1

returned by means of the cheque Ex.PW1/DX1, surely, the

amount of `10,000/- would be the amount of `10,000/- given by

the cheque of `10,000/- which is mentioned in the agreement to

sell as being towards an advance under the agreement to sell and

which was really the amount towards loan given by the

appellant/plaintiff to defendant No.1. I may note that the

cheque, Ex.PW1/DX1 was dishonoured when presented by the

appellant/plaintiff, and thereafter this cheque was returned by the

appellant/plaintiff to the defendant No.1 showing that by virtue

of Section 114(i) of the Evidence Act, 1872 (which states that

where a document creating an obligation in the hands of the

obligor) the obligation under the cheque is discharged. The

document in this case creating the obligation is the cheque,

Ex.PW1/DX1, in favour of the appellant/plaintiff, and which

ordinarily ought to have remained with the appellant/plaintiff

after dishonour, and the fact that it has been returned back to the

defendant No.1 shows that the obligation under the same has

been discharged i.e. the amount of `10,000/- has been repaid

back to the appellant/plaintiff by the defendant No.1.

(IV) Even if I take the statement made by the partner of the appellant

Mr.Chhanga Mal Gupta, Ex.PW2/2, as proved yet a mere

statement of Mr. Chhanga Mal Gupta before the Income Tax

Officer that „originals have been shown to you‟ is not sufficient

proof/discharge of onus, inasmuch as, unless the signatures on

the receipts (and that too on the originals, as in photocopies

signatures can be easily planted) are proved to be the signatures

of defendant No.1, it cannot be said that they are genuine

receipts dated 16.10.1993 and 4.1.1995. Proof of a document

and weight to be attached to such document to establish

existence of a fact are totally separate aspects. Merely because a

document (Ex.PW2/2) is proved it cannot be said that by that

very fact validity of other documents stated therein (being the

two receipts dated 16.10.1993 and 4.1.1995) is also

automatically proved. Merely proving existence of Ex.PW2/2 in

the facts of this case mean that the vexed issue of existence of

receipts can be taken to be proved.

(V) At this stage, I would also seek to deal with the argument of the

appellant that since the original title deeds of the property are

with appellant/plaintiff this shows that there was an agreement to

sell. I disagree with the submission as there is no such pleading

laid out of the original title deeds being with the

appellant/plaintiff in furtherance of the agreement to sell. This

stand of the original title deeds being proof of the agreement to

sell, was for the first time taken in the evidence of the

appellant/plaintiff and there has been sufficient cross-

examination to show lack of credibility of such plea. No amount

of evidence can be looked into for a plea which is not laid out.

Also the admitted case of the appellant/plaintiff is of cordial

relations with defendant Nos.1 and 2 and thus there can be valid

reason(s) for original title deeds being with the

appellant/plaintiff.

(VI) In my opinion, therefore, the appellant/plaintiff has failed to

discharge the onus of proof of existence, validity and

genuineness of the receipts, Ex.PW1/3 and Ex.PW1/2A dated

16.10.1993 and 4.1.1995 and I hold so. Once there is no

agreement to sell between the parties, this ground itself is

enough for dismissal of the suit and the present appeal.

10. The second main reason for dismissal of the suit and the present appeal

is that admittedly the suit property is not solely owned by the defendant No.1,

but is jointly owned by the defendant Nos.1 and 2. It is the admitted case of

the appellant/plaintiff that the so called receipts, Ex.PW1/3 and Ex.PW1/2A

are only signed by defendant No.1-Sh. Hardit Singh and not by his wife-Smt.

Inder Kaur/defendant No.2. Therefore, there is no agreement whereby the

defendant No.2 agreed to sell her half portion of the suit property to the

appellant/plaintiff. Therefore, there cannot be specific performance of the

suit property definitely as against the defendant No.2.

In fact, in the facts of the present case there cannot be specific

performance of the agreement because the appellant/plaintiff claims specific

performance of the agreement as a whole i.e. for whole of the property, and

the appellant/plaintiff has not exercised an option under Section 12 of the

Specific Relief Act, 1963 that the appellant/plaintiff be sold at least half the

portion of the suit property for which there is an agreement to sell with the

defendant No.1. I may note that right till date i.e. not only during the entire

proceedings in the suit, but also during the entire proceedings in this appeal,

at no point of time any option is exercised by the appellant/plaintiff for

seeking specific performance of only half of the portion of the property which

belonged to the defendant No.1. I am stating this aspect of Section 12 of the

Specific Relief Act, 1963 because there are two judgments of the Supreme

Court being Kammana Sambamurthy (dead) by LRs. v. Kalipatnapu

Atchutamma (dead) and Ors. 2011 (11) SCC 153 and Kartar Singh v.

Harjinder Singh and Ors. 1990 (3) SCC 517 which grants decree for specific

performance when the buyer specifically took up a stand in the pleadings and

the evidence, of giving up the right with respect to balance portion of the

property with respect to which no agreement to sell was entered into by the

co-owner. In the present case, as already stated above, there is no case which

is set up by the appellant/plaintiff of seeking only proportionate performance

of the agreement to sell so far as the co-ownership interest of defendant No.1

is concerned, and therefore, there does not arise any issue of grant of specific

performance qua only the share of defendant No.1. A reference in this behalf

may be drawn to the judgment of the Supreme Court in the case of HPA

International V. Bhagwandas Fateh Chand Daswani and Ors., 2004 (6)

SCC 537 and which judgment makes it clear that the entitlement to claim

proportionate specific performance of a part of agreement by paying

proportionate consideration for a part of the property cannot arise unless at

the very first instance a specific case is laid out; pleaded and pursued; for

only a part performance of the agreement to sell. Therefore, I hold that since

the appellant/plaintiff is claiming specific performance of the agreement as a

whole, and the agreement is entered into only with one of the co-owners,

there does not arise grant of relief of specific performance with respect to the

whole suit property, as there is no agreement to sell for the whole property as

the agreement to sell is not signed by one of the two co-owners.

11. On the issue of who is the person guilty of breach of contract assuming

that there existed an agreement to sell between the parties, the case of the

appellant/plaintiff was that the defendant Nos.1 and 2 were guilty of breach

of contract, inasmuch as, according to be appellant/plaintiff, the defendants

no. 1 & 2, insisted that the balance amount of sale consideration be given

only in cash and it is for that purpose that the agreement to sell could not go

through. In my opinion, this argument of the appellant/plaintiff carries no

weight inasmuch as a reference to the plaint and affidavit by way of evidence

filed on behalf of the appellant/plaintiff shows that there is no

pleading/evidence of any date, month or year as to when the defendant Nos.1

and 2 claimed that the balance amount of sale consideration be paid only in

cash. Even assuming that mentioning of a date, month and year is not

required, surely, once there was non-performance for a sufficiently long

period of time of one year and eight months viz from October, 1993 to

December, 1995, it was incumbent upon the appellant/plaintiff at least to

have brought this fact on record by issuing of a letter/notice, because as per

the appellant/plaintiff the defendant Nos.1 and 2 were committing breach of

contract by refusing to accept the money by means of a cheque. However

since there is not even a single letter/notice on record whereby the

appellant/plaintiff had brought such alleged factum of breach of contract of

defendant Nos.1 and 2, it cannot be held that the defendant Nos.1 and 2 were

guilty of breach of performance by allegedly insisting for payment of balance

amount of consideration in cash. The case of the appellant/plaintiff therefore

lacks credibility and I hold that even assuming there was an agreement to sell,

it was the appellant/plaintiff who was guilty of breach of contract. In fact in

my opinion, and as concluded above, this silence of not mentioning the

alleged breach of defendant Nos.1 and 2 in insisting for payment of balance

consideration in cash, further goes to show that in fact there was never any

agreement to sell dated 16.10.1993 and as allegedly confirmed by the

subsequent receipt dated 4.1.1995.

12. While on the aspect of breach, I would also hold that even assuming

there was any agreement to sell, rights under the same were given up on

taking back of the consideration of ` 10,000/- by the appellant/plaintiff at the

time of return of the dishonoured cheque, Ex.PW1/DX1 and hence there is no

question of breach of a contract which has been laid to rest by the parties as

the appellant/plaintiff received back the amount of `10,000/- vide cheque,

Ex.PW1/DX1. This I am observing though otherwise the

defendants/respondents have established that the amount of ` 10,000/-

received by the defendant No.1 by a cheque on about 16.10.1993 was towards

a loan and which was repaid in cash when cheque, Ex.PW1/DX1 was

returned to the defendant No.1. This aspect of there not existing a live

agreement to sell (assuming if there was one) has also to be taken with the

fact that when in March, 1995 the appellant/plaintiff filed a suit for injunction

against defendant Nos.1 and 2 and the Municipal Corporation of Delhi

(MCD) seeking injunction to restrain the defendants from carrying on any

construction in the terrace of the suit property, and which portion admittedly

formed the part of the subject matter of the agreement to sell, the

appellant/plaintiff in the pleadings in the said suit, did not take up a case that

the appellant/plaintiff was a proposed purchaser of the rights in the terrace

under the so-called agreement to sell dated 16.10.1993, confirmed by the

receipt dated 4.1.1995. If a live agreement to sell did exist, and under which

rights existed as on March, 1995 surely in the plaint, (Ex.DW2/2) filed in

March, 1995, the appellant/plaintiff would have definitely mentioned this

fact. There is conspicuous silence in the plaint of existence of rights in

favour of the appellant under the receipts dated 16.10.1993 and 4.1.1995, and

I therefore am constrained to hold and believe that there was no existing and

binding agreement to sell dated 16.10.1993/4.1.1995, assuming the receipts

existed, and that the rights under the same stood extinguished/given up as on

March, 1995.

13. Now, on to the aspect as to whether the appellant/plaintiff was ready

and willing to perform his part of the contract i.e. whether the

appellant/plaintiff has demonstrated its financial capacity to pay the balance

sale consideration. Though, before the trial Court the appellant/plaintiff did

file photocopies of certain fixed deposit receipts (FDR), however, the said

receipts are not a single document for a total amount of `4,10,000/-, the

balance sale consideration. Different fixed deposit receipts (FDRs) are for

different amounts of `62,000/-, ` 50,000/-, ` 45,890/- and ` 1,12,000/- etc. in

the names of different persons, and that too of different points of time of

06.05.1993, 12.04.1998 and16.11.1994, therefore, it cannot be ruled out that

there may be duplication of amounts with respect to certain receipts which

could have been the renewal of the past receipts, and in any case the same

would not show readiness and willingness during the entire period from

October, 1993 till the filing of the suit in December, 1995 at all points of time

of the amount of ` 4,10,000/-. I am for the sake of arguments taking the

FDRs as proved and exhibited, though the trial Court has held that the said

FDRs cannot be held to be proved and exhibited in the absence of originals.

The appellant/plaintiff had through his Advocate closed his evidence without

proving these FDRs.

14. Finally, in my opinion, the facts of the present case are such that the

relief for specific performance ought not to be granted. It is trite that grant of

relief for specific performance is discretionary, and which is so categorically

stated in Section 20(1) of the Specific Relief Act, 1963 which reads as under:-

"20.(1) The jurisdiction to decree specific performance is discretionary, and the court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the court is not arbitary but sound and reasonable, guided by judicial principles and capable of correction by a court of appeal."

Section 20(3) further makes it clear that unless substantial acts are done

under the agreement to sell, specific performance need not be granted.

Considering that substantial acts necessarily will include substantial payment

of the total sale consideration, and since even as per the best case of the

appellant/plaintiff only a sum of `60,000/- has been paid under the agreement

to sell out of the total consideration of `4,70,000/-, in my opinion, the

discretionary relief for specific performance cannot be granted because today

the prices in 2012 will be around 25 to 30 times or thereabouts higher than

the prices prevailing in the year 1995, and even if the respondents/defendants

are granted huge rate of interest on the balance price or even granted

substantial increase in the balance price, the respondents/defendants will not

be able to purchase an alternative property for the amount of the balance price

as on date which they could have purchased in the year 1995. One is

reminded, at this stage, of the observations of the division Bench of the three

judges of the Supreme Court in the case of Nirmala Anand Vs. Advent

Corporation (P) Ltd. (2002) 8 SCC 146 which in para 6 has observed as

under:-

"6. It is true that grant of decree of specific performance lies in the discretion of the court and it is also well settled that it is not always necessary to grant specific performance simply for the reason that it is legal to do so. It is further well settled that the court in its discretion can impose any reasonable condition including payment of an additional amount by one party to the other while granting or refusing decree or specific performance. Whether the purchaser shall be directed to pay an additional amount to the seller or converse would depend upon the facts and circumstances of a case. Ordinarily, the plaintiff is not to be denied the relief of specific performance only on account of the phenomenal increase of price during the pendency of litigation. That may be, in a given case, one of the consideration besides many others to be taken into consideration for refusing the decree of specific performance. As a general rule, it cannot be held that

ordinarily the plaintiff cannot be allowed to have, for her along, the entire benefit of phenomenal increase of the value of the property during the pendency of the litigation. While balancing the equities, one of the consideration to be kept in view is as to who is the defaulting party. It is also to be borne in mind whether a party is trying to take undue advantage over the other as also the hardship that may be caused to the defendant by directing the specific performance. There may be other circumstances on which parties may not have any control. The totality of the circumstances is required to be seen."

(underlining added)

15. Therefore, exercise of discretion whether to grant or refuse specific

performance is a judicial discretion which depends on the facts of each case.

In the present case there is total uncertainty to the existence of agreement to

sell and which in fact in my opinion does not exist, even if the same existed

there was in fact breach on the part of the appellant/plaintiff, and further even

if the agreement to sell if entered into, rights under the same were given up on

receiving back of the amount of `10,000/- in October, 1994 by the

appellant/plaintiff from defendant No.1 and finally third party rights have

come into existence which compels me to hold that the appellant/plaintiff is

not entitled to specific performance as prayed for. A seller cannot be

indefinitely asked to wait, and it has otherwise come on record that defendant

Nos. 1 and 2 were in urgent need of funds due to financial difficulties, and for

which reason they were selling the suit property. In certain cases where

substantial consideration i.e. at least 50% of the consideration is paid, or

possession of the property is delivered under the agreement to sell in addition

to paying advance price, the proposed buyer is vigilant for his rights and he

files the suit soon after entering into the agreement to sell, then in accordance

with totality of facts and circumstances Courts may decree specific

performance, however, in the facts of the present case (as found and stated

above) I do not think that the appellant is entitled to discretionary relief of

specific performance. I may, at this stage, reiterate that the Supreme Court

has said that merely because there is limitation for filing a suit for specific

performance does not mean that a suit which is filed much after the entering

into of an agreement to sell, and/or much later than the alleged breach, then

such a suit for specific performance ought to be decreed merely because it is

filed within the period of limitation. These are the observations which are

made by the Supreme Court keeping in view the phenomenal rises in prices

of immovable properties in urban areas. The Supreme Court has made

categorical observations that in specific performance cases time of

performance should be of the essence, and the doctrine of time not being of

the essence should be given a go bye so far at least immovable properties are

situated in urban areas vide K.S. Vidyanadam and Ors. v. Vairavan, 1997(3)

SCC 1 and Mrs. Saradamani Kandappan v. Mrs. S. Rajalakshmi and Ors.,

2011 (12) SCC 18. Though the observations of the Hon‟ble Supreme Court

are with respect to time of performance being not of essence in sales of

immovable properties, I am referring to the same as they touch on the aspect

of delay in seeking specific performance. In the facts of the case the

existence of delay of at least one year from the last receipt dated 4.1.95 and

seven months after third party rights were created is one factor, when taken

with others, to hold that appellant/plaintiff is not entitled to the discretionary

relief of specific performance.

16. No other point or issue was urged or pressed for before me, expect the

above aspects which have been dealt by me hereinabove.

17. In view of the above, there is no merit in the appeal, and the same is

dismissed leaving the parties to bear their own costs. Trial Court record be

sent back.

VALMIKI J. MEHTA, J.

APRIL 30, 2012 AK