Delhi High Court
Sushil Kumar Bagga vs Dewan Chander Batra & Anr. on 20 January, 2014
Author: Rajiv Sahai Endlaw
*IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 20th January, 2014.
+ RFA No.268/2010
SUSHIL KUMAR BAGGA ..... Appellant
Through: Mr. K.R. Chawla & Mr. Sunil Verma
& Advs.
Versus
DEWAN CHANDER BATRA & ANR. ..... Respondents
Through: Ms. Maninder Acharya, Sr. Adv. with
Mr. Yashish Chandra, Adv. for R-1.
CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
RAJIV SAHAI ENDLAW, J.
1. The appeal impugns the judgment and decree (dated 19th December,
2009 of the Court of the Additional District Judge (ADJ), Delhi in CS
No.98/2008 filed by the respondent No.1/plaintiff against the appellant Sh.
Sushil Kumar Bagga and the respondent No.2 Smt. Chander Kanta Sharma)
of specific performance of the Agreement to Sell dated 16th September, 1985
by the respondent No.2/defendant No.1 in favour of the respondent
No.1/plaintiff with respect to property No.198/17A, Garhi, East of Kailash,
New Delhi and further declaring the Sale Deed dated 9th March, 1999
executed by the respondent No.2/defendant No.1 in favour of the appellant
with respect to the said property to be hit by the principles of lis pendens and
of cancellation thereof.
2. Notice of the appeal was issued and vide ex-parte ad-interim order
dated 7th May, 2010, the operation of the impugned judgment and decree
was stayed. The appeal was on 9th July, 2010 admitted for hearing and the
Trial Court record requisitioned. On 29th July, 2011, the earlier interim
order was confirmed and the appeal was listed for hearing in the category of
regular matters. Hearing was expedited for the reason of the respondent
No.1/plaintiff being a senior citizen. The counsels have been heard.
3. The respondent No.1/plaintiff on 31st July, 1986 instituted the suit
from which this appeal arises, originally against the respondent
No.2/defendant No.1 Smt. Chander Kanta Sharma only, pleading:
(i) that the respondent No.2/defendant No.1 had on 16th
September, 1985 entered into an Agreement for Sale of the property to
the respondent No.1/plaintiff for a total sale consideration of
Rs.1,65,000/- and in pursuance thereto the respondent No.1/plaintiff
paid a sum of Rs.20,000/- in cash towards the sale price and the
balance amount of Rs.1,45,000/- was payable by the respondent
No.1/plaintiff at the time of registration of the Sale Deed latest by 31st
December, 1985;
(ii) that the respondent No.2/defendant No.1 requested the
respondent No.1/plaintiff for extension of time upto 31st March, 1986
for registration of the Sale Deed on the plea that the sons of the
respondent No.2/defendant No.1 were appearing for examination and
she wanted time to deliver possession of the property;
(iii) that the respondent No.2/defendant No.1 also approached Sh.
N.R. Gupta, the then landlord of the respondent No.1/plaintiff and
requested him to allow the respondent No.1/plaintiff to continue
staying as a tenant in Sh. N.R. Gupta‟s house upto 31st March, 1986;
(iv) that the respondent No.1/plaintiff acceded to the request of the
respondent No.2/defendant No.1 for extension of time and an
Agreement for extension of time for the registration of the Sale Deed
and handing over physical possession was executed on 30th December,
1985;
(v) that the respondent No.2/defendant No.1 again requested the
respondent No.1/plaintiff for extension of time for registration of the
Sale Deed and delivery of possession upto 30th April, 1986 on the plea
that the sons of the respondent No.2/defendant No.1 were appearing
for competitive examination and again an Agreement for extension of
time for registration of the Sale Deed was executed on 28th March,
1986;
(vi) that the respondent No.1/plaintiff before 30th April, 1986
approached the respondent No.2/defendant No.1 to register the Sale
Deed and hand over possession but the respondent No.2/defendant
No.1 again requested for some more time as her brother-in-law Sh.
N.S. Sisodia, Sub Inspector was going to be married in the month of
May, 1986 at Bulandshahar, U.P.;
(vii) that the respondent No.1/plaintiff however did not agree to the
extension;
(viii) that the respondent No.1/plaintiff vide letter dated 27th April,
1986 called upon the respondent No.2/defendant No.1 to vacate the
premises and get the Sale Deed registered;
(ix) that no reply was given by the respondent No.2/defendant No.1
thereto;
(x) that the respondent No.1/plaintiff sent another letter dated 13th
May, 1986 again calling upon the respondent No.2/defendant No.1 to
perform her part of the Agreement;
(xi) that the respondent No.2/defendant No.1 however vide notice
dated 14th May, 1986 cancelled the Agreement to Sell and forfeited
the amount of Rs.20,000/- on a false plea;
(xii) that a reply dated 19th May, 1986 was given by the respondent
No.1/plaintiff to the aforesaid legal notice;
(xiii) that the respondent No.1/plaintiff was ready and willing to
perform her part of the Agreement to Sell.
Accordingly, the suit for specific performance and in the alternative
for damages equivalent to the price of the property prevailing at that time
was filed.
4. Summons of the suit were issued and vide ex-parte ad-interim order
dated 1st August, 1986, the respondent No.2/defendant No.1 restrained from
transferring, alienating or parting with possession of the property.
5. The respondent No.2/defendant No.1 in her written statement/reply to
the application for interim relief stated that since she needed money for
construction of her own property at Noida, she had already sold the property
in question to Sh. Sushil Kumar Bagga i.e. the appellant herein, Sh. Brij
Bhushan Bagga, Sh. Naresh Kumar Bagga and Ms. Raj Rani and handed
over vacant and peaceful possession of the property to the said persons,
though owing to the Sale Deeds being not registered by the Registrar, formal
Sale Deed had not been registered.
6. The respondent No.2/defendant No.1 else, though admitting the
Agreement to Sell in favour of the respondent No.1/plaintiff, pleaded:
(a) that it was the respondent No.1/plaintiff who had been
approaching the respondent No.2/defendant No.1 for extension of
time for making payment of the balance amount of sale consideration
for the reason of being unable to collect the balance sale consideration
payable at the time of execution and registration of the Sale Deed;
(b) that the respondent No.2/defendant No.1 was very keen to sell
the house by December, 1985 and move to a new premises so that her
son could settle down in the new house for his 12th Class examination
during March/April, 1986;
(c) that the respondent No.2/defendant No.1 had agreed to extend
the time upto 31st March, 1986;
(d) that similarly the extension of time for execution of the Sale
Deed till 30th April, 1986 was also at the request of the respondent
No.1/plaintiff, though the same was inconvenient to the respondent
No.2/defendant No.1 for the reason of her other son‟s B.A.-I
examination being in April, 1986;
(e) denying receipt of letter dated 27th April, 1986;
(f) that since the respondent No.1/plaintiff did not have financial
resources to honour the Agreement to Sell dated 16th September, 1985
and because of the delaying tactics of the respondent No.1/plaintiff,
the respondent No.2/defendant No.1 out of her frustration, on 14th
May, 1986 cancelled the Agreement, because of the failure of the
respondent No.1/plaintiff to fulfill his obligations;
(g) denying that there was any increase in the price of the property,
after the Agreement dated 16th September, 1985;
(h) denying that the respondent No.1/plaintiff was in a position to
make payment of the balance sale consideration;
(i) that the occasion for the respondent No.2/defendant No.1 to
apply for permission to the Income Tax Department did not arise since
the respondent No.1/plaintiff did not have the balance sale
consideration.
7. Needless to state that the respondent No.1/plaintiff filed a replication
reiterating his case.
8. The following issues were framed in the suit on 11th September, 1987:
"1. Whether the plaintiff has always been ready and willing to
perform his part of the agreement?
2. Whether the defendant has sold the property to Sh. Sushil
Kumar Bagga, Shri Brij Bhushan Bagga, Shri Naresh Kumar
Bagga and Mrs. Raj Rani wife of Ashwani Kumar, as stated in
para 3 and 4 of the written statement, is so, its effect?
3. Whether the plaintiff is entitled to specific performance of the
agreement?
4. To what damages the plaintiff is entitled?"
9. The respondent No.2/defendant No.1 was proceeded against ex-parte
on 25th May, 1990 and the respondent No.1/plaintiff led her ex-parte
evidence. However, on the application of the respondent No.2/defendant
No.1, the order proceeding ex-parte against her was recalled on 29th
November, 1990. The respondent No.1/plaintiff again examined himself
and only one other witness namely Sh. K.K. Nayyar and closed his evidence
in affirmative. On 30th August, 1999, the counsel for respondent
No.2/defendant No.1 stated that the respondent No.2/defendant No.1 has to
examine only one witness namely Sh. Sushil Kumar Bagga. No witness was
however examined by the respondent No.2/defendant No.1 and the
respondent No.2/defendant No.1 on 24th November, 1999 closed her
evidence.
10. Thereafter, an application under Order I Rule 10 of the Civil
Procedure Code (CPC), 1908 was filed by the appellant for impleadment in
the suit inter alia pleading that the respondent No.2/defendant No.1 had vide
Agreement to Sell dated 16th June, 1986 agreed to sell the property to the
appellant for a sum of Rs.60,000/- and put the appellant into possession of
the property and subsequently a Sale Deed was also registered in favour of
the appellant on 9th March, 1999. The said application was dismissed vide
order dated 10th November, 2000 on the ground that the Agreement to Sell
on the basis whereof impleadment was sought was dated 16th June, 1986 i.e.
during the subsistence of the Agreement to Sell dated 16th September, 1985
in favour of the respondent No.1/plaintiff and the Sale Deed in favour of the
appellant was in violation of the restraint order against the respondent
No.2/defendant No.1 in the suit.
11. The appellant preferred an appeal against the order of dismissal of his
application for impleadment, which was also dismissed by the Division
Bench of this Court vide order dated 21st March, 2001. The appellant
thereafter preferred a Special Leave Petition (SLP) which was granted and
converted into Civil Appeal No.3295/2002 and which was allowed vide
order dated 3rd May, 2002 of the Supreme Court, permitting the appellant to
file a written statement and directing this Court to proceed with hearing of
the suit thereafter.
12. Accordingly, the appellant was vide order dated 10th May, 2002 in the
suit impleaded as defendant No.2 to the suit. The respondent No.1/plaintiff
accordingly applied for and was allowed to amend the plaint seeking the
relief of specific performance against the appellant/defendant No.2 also.
13. The appellant/defendant No.2 contested the suit by filing a written
statement inter alia on the same grounds as the respondent No.2/defendant
No.1 and further pleading:
(I) that the provisions of Section 52 of the Transfer of Property
Act, 1882 were not applicable as the property had been sold to the
appellant/defendant No.2 vide Agreement dated 16th June, 1986 i.e.
before the institution of the suit (on 31st July, 1986);
(II) denying that the appellant/defendant No.2 had purchased the
property without knowledge of the Agreement to Sell dated 16th
September, 1985 in favour of the respondent No.1/plaintiff;
(III) that though the Agreement to Sell dated 16th June, 1986 was in
favour of the appellant/defendant No.2 along with four others but the
said others sold their shares to the appellant/defendant No.2 and the
Sale Deed dated 9th March, 1999 was only a family arrangement
between the original buyers of the property.
14. The suit was thereafter transferred to the District Court owing to the
changes in the pecuniary jurisdiction of the Courts.
15. The respondent No.1/plaintiff filed replication to the written statement
of the appellant/defendant No.2 and fresh issues as under were framed in the
suit on 3rd December, 2005 and corrected on 29th August, 2009:
"1. Whether the plaintiff is entitled to the relief as prayed for?
OP Parties.
2. Whether the plaintiff has been ready and willing to fulfil his
obligations at all times? OPP
3. Whether the defendant No.1 colluded with the defendant No.2
and transferred the property during the pendency of the lis?
4. Whether the defendant No.2 is a bonafide purchaser without
notice and for consideration? If so, its effect?
5. Whether the plaintiff is entitled to any damages, if so, to what
extent and from whom? OPP.
6. Relief."
16. The respondent No.2/defendant No.1 stopped appearing and was
proceeded against ex-parte on 15th October, 2004.
17. The respondent No.1/plaintiff again examined himself and two other
witnesses.
18. The learned ADJ, in the impugned judgment has,
found/observed/held:
(a) (the learned ADJ has taken into account the deposition of Sh.
K.K. Nayyar supra examined by the respondent No.1/plaintiff as
well as the deposition of respondent No.2/defendant No.1, both of
whom were examined prior to the appellant/defendant No.2
becoming a party to the suit);
(b) that the respondent No.2/defendant No.1 in her deposition had
admitted the Agreements for extension of time for completion of sale
from 31st December, 1985 to 31st March, 1986 and thereafter to 30th
April, 1986 to be in her own handwriting and the stamp papers on
which the said Agreements were engrossed were also bought in the
name of the respondent No.2/defendant No.1;
(c) that if the reason for extension of time was to give more time to
the respondent No.1/plaintiff to arrange for money, there was no
reason for the respondent No.2/defendant No.1 to have not stated so
in the said Agreements of which she herself was the scribe;
(d) that the positive assertions made by the respondent
No.1/plaintiff in his examination-in-chief of the reason for extension
being the request of the respondent No.2/defendant No.1 had not
been challenged in the cross-examination by the respondent
No.2/defendant No.1 of the respondent No.1/plaintiff;
(e) that thus the version of the respondent No.1/plaintiff for the
reason for extension was more credible than that of the respondent
No.2/defendant No.1;
(f) that the respondent No.1/plaintiff had proved sending letter
dated 27th April, 1986 by UPC and since the same was addressed at
the correct address of the respondent No.2/defendant No.1, there was
presumption of service;
(g) that the readiness and willingness of the respondent
No.1/plaintiff to perform his part of the Agreement was evident from
the said letter;
(h) that the conduct of the respondent No.2/defendant No.1 not
replying to the said letter shows her to be the unwilling party;
(i) that the conduct of the respondent No.1/plaintiff of issuing the
reminder dated 13th May, 1986 referring to the previous letter dated
27th April, 1986 also showed that the respondent No.1/plaintiff had
the requisite funds to pay the balance sale consideration;
(j) that the respondent No.2/defendant No.1 had admitted receipt
on 17th/18th May, 1986, of letter dated 13th May, 1986 and had
further admitted that she thereafter did not ask the respondent
No.1/plaintiff to pay the money or offer to execute the Sale Deed;
(k) that the conduct of the respondent No.2/defendant No.1 of not
replying to the letter dated 13th May, 1986 demonstrated that the
respondent No.2/defendant No.1 was not ready to honour her
commitment and that she was the unwilling party;
(l) that the respondent No.2/defendant No.1 in her cross-
examination had also admitted having received the letter dated 13th
May, 1986 prior to issuance of the notice dated 14th May, 1986 of
cancellation of the Agreement to Sell;
(m) that the promptness of the respondent No.1/plaintiff in replying
on 19th May, 1986 itself to the notice dated 14th May, 1986 of
cancellation of the Agreement to Sell also shows the willingness of
the respondent No.1/plaintiff;
(n) that the respondent No.2/defendant No.1 had not proved any
effort on her part to get any document executed to enable the transfer
of the property;
(o) that the legal notice dated 14th May, 1986 thus appeared to be
antedated;
(p) that the admission by the respondent No.2/defendant No.1 of
her sons having examinations in March/April, 1986, corroborated the
version of the respondent No.1/plaintiff of the reason for extension
of time for completion of the sale;
(q) that the respondent No.2/defendant No.1 in her written
statement did not specify the date of sale in favour of the
appellant/defendant No.2 and others;
(r) that the reason given by the respondent No.2/defendant No.1
for her hurry to sell the house i.e. to construct her house in Noida and
her being not eligible for house building advance loan for the reason
of her impending retirement from service on 31st July, 1993, was
false as the respondent No.2/defendant No.1 in May, 1985 still had
seven years of service left and could easily avail house building
advance loan, thus her claim for distress sale could not be believed;
(s) that the claim of the respondent No.2/defendant No.1 in her
cross-examination that she contacted the respondent No.1/plaintiff
on telephone and despite which the respondent No.1/plaintiff did not
bring the money could not be believed as the same was beyond
pleadings;
(t) that while the Agreement to Sell in favour of the respondent
No.1/plaintiff was for consideration of Rs.1,65,000/-, the sale to the
appellant/defendant No.2 and others which was claimed to be for
Rs.60,000/-, was improbable;
(u) that the respondent No.1/plaintiff was a teacher with D.A.V.
Senior Secondary School for the last 23 years and had testified to
getting a salary over Rs.3,000/- per month and his wife working as a
Government School Teacher also getting a salary of Rs.2,200/- per
month and had proved having a bank balance of Rs.35,000/-, cash in
hand of Rs.15,000/- and jewelry of Rs.1,10,000/-;
(v) that the brother of the wife of the respondent No.1/plaintiff had
also deposed that the wife of the respondent No.1/plaintiff had
deposited Rs.1,00,000/- with him;
(w) that there was thus no reason to disbelieve that the respondent
No.1/plaintiff was in a position to arrange for the balance sale
consideration of Rs.1,45,000/-;
(x) that accordingly Issue Nos.1 & 2 framed on 3rd December, 2005
were decided in favour of the respondent No.1/plaintiff and against
the appellant and the respondent No.2/defendant;
(y) that the respondent No.2/defendant No.1 did not file the
documents of sale or copies thereof executed in favour of the
appellant/defendant No.2 and others and it was only in the year 1994
when the respondent No.2/defendant No.1 attempted to file certain
documents but which was not permitted;
(z) that though the respondent No.2/defendant No.1 had pleaded
sale in favour of the appellant/defendant No.2 and four others but the
possession letter dated 28th March, 1986 filed by the
appellant/defendant No.2 was of delivery of possession to one Sh.
Vinod Kumar Bagga only who was not the purchaser as pleaded by
the respondent No.2/defendant No.1;
(aa) that the said possession letter further recorded the Agreement to
Sell dated 16th June, 1986 to be with the said Sh. Vinod Kumar
Bagga only;
(ab) that the said possession letter also mentions a General Power of
Attorney (GPA) dated 18th June, 1986 having been executed by the
respondent No.2/defendant No.1 in favour of the said Sh. Vinod
Kumar Bagga;
(ac) that the said possession letter thus contradicted the claim of the
appellant and respondent No.2/defendants of sale to the
appellant/defendant No.2 and Sh. Brij Bhushan Bagga, Sh. Naresh
Kumar Bagga and Mrs. Raj Rani and the said discrepancy had
remained unexplained;
(ad) that none of the aforesaid persons had also been examined in
the evidence to prove the sale if any of 16th June, 1986;
(ae) that even if the Agreement to Sell dated 16th June, 1986 were to
be believed as genuine, the same did not transfer the ownership of
the suit property and thus the appellant and the respondent
No.2/defendants had failed to prove that the property was sold before
filing of the suit;
(af) that the alleged Agreement to Sell dated 16th June, 1986 and
subsequent Sale Deed dated 9th March, 1999 were mentioned for the
first time in the application for impleadment filed by the
appellant/defendant No.2;
(ag) that thus the claim of sale of the property before filing of the
suit was difficult to believe;
(ah) that when the respondent No.1/plaintiff in the amended plaint
took the plea of the Sale Deed dated 9th March, 1999 being bogus,
the appellant/defendant No.2 claimed the same to be only a family
settlement and the sale having taken place vide Agreement to Sell
dated 16th June, 1986;
(ai) that the appellant/defendant No.2 in his evidence did not
mention any Power of Attorney or Will and only deposed about the
Agreement to Sell dated 16th June, 1986;
(aj) that the documents proved by the appellant/defendant No.2 of
his possession of the property were of the year 1988 and after;
(ak) that the payment of Rs.60,000/- by the appellant/defendant
No.2 to the respondent No.2/defendant No.1 on 16th June, 1986 had
also not been proved;
(al) that the respondent No.2/defendant No.1 was vide order dated
20th February, 1987 expressly restrained from transferring or
alienating the property recording that no formal document of sale
had been registered till then;
(am) that the respondent No.2/defendant No.1 had inspite of
directions of the Court not filed the documents allegedly executed of
sale and which circumstance cast a doubt on the authenticity of the
Agreement dated 16th June, 1986 which was filed only on 17th April,
2007;
(an) that the appellant/defendant No.2 at least as on 13th July, 1989
when it was stated that he was the only witness to be examined on
behalf of the respondent No.2/defendant No.1, aware of the suit;
(ao) that the stand of the Sale Deed dated 9th March, 1999 being a
family arrangement was also contradictory;
(ap) that the said Sale Deed dated 9th March, 1999 was also
disclosed for the first time in the application dated 24th November,
1999 for impleadment; in the said application, it was pleaded that the
respondent No.2/defendant No.1 had executed the Sale Deed through
her Attorney;
(aq) that no registered Will or Power of Attorney to show the sale of
the suit property on 16th June, 1986 had been produced or proved;
(ar) that the Agreement to Sell dated 16th June, 1986 had not even
been proved by the respondent No.2/defendant No.1;
(as) that the witnesses to the Agreement to Sell had also not been
examined;
(at) that the only inference thus was that the property was not sold
on 16th June, 1986;
(au) that the Sale Deed dated 9th March, 1999 was for a sale
consideration of Rs.1,60,000/- and does not contain any mention of
the Agreement to Sell dated 16th June, 1986 or of the transaction
being a family arrangement;
(av) that it was accordingly held that the respondent No.2/defendant
No.1 had colluded with the appellant/defendant No.2 and transferred
the suit property during the pendency of the lis and the
appellant/defendant No.2 was not a bona fide purchaser without
notice and for consideration; accordingly, Issues No.3 & 4 were
decided in favour of the respondent No.1/plaintiff and against the
appellant and the respondent No.2/defendants.
Resultantly, the suit was decreed as aforesaid.
19. Needless to state that the respondent No.2/defendant No.1 has not
appeared in this appeal.
20. Though the senior counsel for the respondent No.1/plaintiff during the
hearing on 29th August, 2013 contended that only plea available to the
appellant/defendant No.2 as the subsequent purchaser is with respect to
Section 19(b) of the Specific Relief Act, 1963 and the subsequent purchaser
is not entitled to challenge inter alia the readiness and willingness of the
purchaser/decree holder by placing reliance on Jugraj Singh Vs. Labh
Singh (1995) 2 SCC 31 but her attention was invited to Ram Awadh Vs.
Achhaibar Dubey (2000) 2 SCC 428 overruling Jugraj Singh supra.
21. The counsel for the appellant/defendant No.2 has argued:
(i) that the admission by the respondent No.2/defendant No.1 of
the Agreements dated 30th December, 1985 and 28th March, 1986 of
extension of time for completion of sale being in her handwriting is
not admission of contents of the documents;
(ii) that the appellant/defendant No.2 did not have knowledge of
the Agreement to Sell in favour of the respondent No.1/plaintiff and is
a bona fide purchaser for consideration after making enquiries from
the neighbours and which did not reveal the Agreement to Sell in
favour of the respondent No.1/plaintiff;
(iii) that it is not the case of the respondent No.1/plaintiff that the
appellant/defendant No.2 had knowledge of the Agreement to Sell in
favour of the respondent No.1/plaintiff;
(iv) that even though the Sale Deed dated 9th March, 1999 in favour
of the appellant/defendant No.2 has been executed during the
pendency of the suit but the principle of lis pendens will not apply
since the same is in pursuance to the Agreement to Sell dated 16th
June, 1986, which is prior to the date of institution of the suit.
Reliance in this regard is placed on S.K.M. Mohammed Amanullah
Vs. T.C.S. Ramasangu Pandian AIR 1995 AIHC 964 (Madras);
(v) reliance is also placed on V. Muthusami Vs. Angammal AIR
2002 SC 1279 and Rajan Vs. Yunuskutty AIR 2002 Kerala 339 (DB)
to contend that the discretion implicit in the grant of relief of specific
performance is not to be exercised when the property has already been
sold to another person;
(vi) attention is invited to the order dated 10th November, 2000 in
the suit in which the contention of the counsel for the
appellant/defendant No.2 of the property having been sold vide
Agreement to Sell dated 16th June, 1986 is recorded and it is thus
contended that the finding in the impugned judgment of the same
having been disclosed for the first time on 24th November, 1999 in the
application for impleadment, is erroneous;
(vii) attention is invited to the application filed by the
appellant/defendant No.2 for impleadment in which also the
Agreement to Sell dated 16th June, 1986 is expressly pleaded and the
copy of the Agreement to Sell is also pleaded to have been annexed to
the application for impleadment;
(viii) that the appellant/defendant No.2 cannot be punished for non-
disclosure by the respondent No.2/defendant No.1 of the said
Agreement to Sell;
(ix) that in the application for impleadment reference is also made
to a Power of Attorney having been registered by respondent
No.2/defendant No.1 on 11th July, 1986 with the Sub Registrar, Noida
in favour of Sh. Vinod Kumar Bagga, brother of the
appellant/defendant No.2;
(x) attention is invited to the judgment of this Court in Asha M.
Jain Vs. Canara Bank 94 (2001) DLT 841 (DB) to contend that
judicial notice was taken of properties being transacted through the
medium of Agreement to Sell and Power of Attorney;
(xi) that the Ration Card of the appellant/defendant No.2 at the
address of the property is of 26th July, 1986;
(xii) that the Sale Deed dated 9th March, 1999 in favour of the
appellant/defendant No.2 is in pursuance to the Agreement to Sell
dated 16th June, 1986 and the Power of Attorney registered on 11th
July, 1986;
(xiii) attention is invited to the written statement verified on 30th
October, 1986 of the respondent No.2/defendant No.1 in which also
the sale in favour of the appellant/defendant No.2 and Sh. Brij
Bhushan Bagga, Sh. Naresh Kumar Bagga and Mrs. Raj Rani is
pleaded;
(xiv) that the respondent No.1/plaintiff had only Rs.35,000/- in his
bank account;
(xv) that though the respondent No.1/plaintiff in support of his
version of the extension of time for completion of sale being at the
instance of the respondent No.2/defendant No.1 had pleaded that the
respondent No.2/defendant No.1 had also contacted Sh. N.R. Gupta
the then landlord of the respondent No.1/plaintiff but the said Sh. N.R.
Gupta was not produced in evidence;
(xvi) that no presumption can be drawn of service of the letter dated
27th April, 1986 sent by UPC;
(xvii) that the respondent No.1/plaintiff has not proved knowledge by
the appellant/defendant No.2 of the Agreement to Sell in favour of the
respondent No.1/plaintiff;
(xviii) that though the respondent No.1/plaintiff had also pleaded that
the respondent No.2/defendant No.1 had spoken to Sh. N.R. Gupta
supra in presence of other persons but the said persons also were not
examined;
(xix) that the respondent No.1/plaintiff in his deposition on 15th May,
1991 had stated that his wife had since the year 1985 been depositing
her salary with her brother and as a result of which she had saved
nearly Rs.1,00,000/- but on the basis of her salary disclosed as
Rs.2,200/- per month, the saving even if of the entire salary for one
year could be of Rs.26,400/- only and not of Rs.1,00,000/-;
(xx) that the valuer who had given the report of valuation of jewelry
possessed by the respondent No.1/plaintiff was also not produced as a
witness;
(xxi) that no source of acquisition of jewelry by the respondent
No.1/plaintiff and his wife was proved;
(xxii) that the respondent No.1/plaintiff in his deposition on 5th
February, 1992 attempted to improve his case by deposing of owning
other properties from sale whereof sale consideration for purchase of
the subject property could be arranged; the same shows that the
respondent No.1/plaintiff was trying to improve his case and had no
ready money with him;
(xxiii) attention is invited to the cross-examination on 6th February,
1992 of the respondent No.1/plaintiff to contend that the statements
recording readiness and willingness and availability of funds are
inconsistent;
(xxiv) that though the respondent No.1/plaintiff prior to the
impleadment of the appellant/defendant No.2 had examined his
brother-in-law Sh. K.K. Nayyar but did not examine him thereafter;
(xxv) that the learned ADJ vide separate order of the same date as the
impugned judgment on the application of the respondent
No.1/plaintiff under Order XXXIX Rule 2A of the CPC has also held
the respondent No.2/defendant no.1 guilty of violation of the order
under Order XXXIX Rules 1 & 2 of the CPC and imposed fine of
Rs.30,000/- on her;
(xxvi) that the evidence of Sh. K.K. Nayyar recorded prior to the
impleadment of the appellant/defendant No.2 cannot be read against
the appellant/defendant No.2;
(xxvii) that the subject land measured 88-90 sq. yds. and the
appellant/defendant No.2 has since purchased adjoining 16 sq. yds. of
land also and raised construction of four stories on the total land; the
document of purchase of the said 16 sq. yds. of land has been proved
as DW-2/16;
(xxviii) that the respondent No.1/plaintiff in the cross-examination
recorded on 8th August, 1994 of the respondent No.2/defendant No.1
did not challenge delivery of possession of the property by the
respondent No.2/defendant No.1 to the appellant/defendant No.2 and
the other purchasers;
(xxix) that the photocopy of the GPA executed by the respondent
No.2/defendant No.1 in favour of Sh. Vinod Kumar Bagga registered
at Noida on 11th July, 1986 exists at pages 607 to 611 of Part-II of the
Trial Court record, though has not been proved;
(xxx) that similarly the photocopy of the Sale Deed dated 9th March,
1999 exists at pages 745 to 757 of Part-II of the Trial Court record,
though has not been proved;
(xxxi) that the respondent No.1/plaintiff in his affidavit by way of
examination-in-chief after the impleadment of the appellant/defendant
No.2 has not deposed that the appellant/defendant No.2 had
knowledge of the Agreement to Sell in favour of the respondent
No.1/plaintiff before 16th June, 1986;
(xxxii) that the respondent No.1/plaintiff in his cross-examination
recorded on 5th March, 2007 has admitted having come to know of the
purchase of the property by the appellant/defendant No.2 during July,
1986 and is now not entitled to challenge the same;
(xxxiii) that the counsel for the respondent No.1/plaintiff in the cross-
examination of the appellant/defendant No.2 recorded on 24th July,
2007 suggested that the appellant/defendant No.2 had been coming
along with the respondent No.2/defendant No.1 to the Court since 16th
June, 1986 as and when he received notice from the Court, again
admitting the sale in favour of the appellant/defendant No.2 of 16th
June, 1986;
(xxxiv) reference has also been made to:
(a) Muktakesi Dawn Vs. Haripada Mazumdar AIR 1988
Calcutta 25 (DB) laying down that in a suit for specific
performance of an Agreement of Sale if the defendant is not
restrained from selling a property to a third party and third party
purchases the same bona fide for value without any notice of
pending litigation and spends huge amount in construction
thereof, the equity in his favour may intervene to persuade the
Court to decline the equitable relief of specific performance and
to award damages only;
(b) Ram Kumar Tiwari Vs. Deenanath AIR 2002
Chhattisgarh 1 laying down that sale prior to the institution of
the suit is not hit by Section 52 of the Transfer of Property Act;
(c) Kanshi Ram Vs. Om Prakash Jawal (1996) 4 SCC 593
where the offer of the defendant in a decree for specific
performance to pay Rs.10 lakhs instead of the alternative relief
claimed for recovery of damages of Rs.10,000, was accepted;
(d) judgment dated 8th August, 2012 of this Court in CS
No.1735/1997 titled Sushil Jain Vs. Meharban Singh where
on the failure of the plaintiff in a suit for specific performance
to file his income tax return or bank account statement to show
availability of funds to pay the balance sale consideration, the
mere averment of readiness and willingness was not accepted
and the plaintiff was held to be not ready and willing to perform
his part of the Agreement and also laying down that where the
plaintiff in a suit for specific performance has paid less than
50% of the consideration, he is not entitled to the discretionary
relief of specific performance;
(e) Javer Chand Vs. Pukhraj Surana AIR 1961 SC 1655
laying down that once a document has been marked as an
exhibit and has been used by the parties in examination and
cross-examination, it is not open to the Court to go behind the
said order;
(f) Bishan Singh Vs. Khazan Singh AIR 1958 SC 838
laying down that if the sale is a transfer in recognition of a pre-
existing subsisting right, it would not be affected by the
doctrine of lis pendens as the said transfer does not create new
title pendente lite;
(g) Ram Awadh Vs. Achhaibar Dubey AIR 2000 SC 860 to
contend that the plea of the plaintiff being not ready and willing
was available, both to the defendant as well as subsequent
purchasers.
22. The senior counsel for the respondent No.1/plaintiff has argued:
(I) that the appellant/defendant No.2 is not a bona fide purchaser
for value without notice prior to the Agreement to Sell; thus the
readiness and willingness of the respondent No.1/plaintiff is
immaterial;
(II) that the Sale Deed dated 9th March, 1999 is not relatable to the
alleged transaction of 16th June, 1986;
(III) attention is invited to the order dated 13th July, 1989 in the suit
recording the presence of the appellant/defendant No.2 as a witness
and it is contended that the appellant/defendant No.2 appeared for the
first time in the suit on the said date only and his claim of purchase on
16th June, 1986 is bogus;
(IV) in the written statement dated 30th October, 1986 of the
respondent No.2/defendant No.1, there is no mention of any GPA
having been executed by the respondent No.2/defendant No.1 in
favour of the appellant/defendant No.2 or his nominee;
(V) attention is invited to the order dated 19th December, 2009 of
the Trial Court on the application of the respondent No.1/plaintiff
under Order XXXIX Rule 2A of the CPC recording the findings of the
sale to the appellant/defendant No.2 being in violation of the interim
injunction in the suit;
(VI) attention is invited to the possession letter dated 28th June, 1986
executed by the respondent No.2/defendant No.1 to contend firstly
that it is inconceivable as to why possession in pursuance to the
Agreement to Sell dated 16th June, 1986 would be given on 28th June,
1986 and secondly that the possession is recorded to have been given
in pursuance to the Agreement to Sell to Sh. Vinod Kumar Bagga,
whereas the plea is of Agreement to Sell dated 16th June, 1986 in
favour of the appellant/defendant No.2 and others and not Sh. Vinod
Kumar Bagga;
(VII) that such inconsistencies cast a doubt as to the alleged
transaction on 16th June, 1986;
(VIII) that on enquiry, it is stated that no evidence has been led by the
respondent No.1/plaintiff of any increase in prices between the date of
the Agreement to Sell in favour of the respondent No.1/plaintiff and
the date fixed for completion of sale;
(IX) that the Power of Attorney on the basis of which Sh. Vinod
Kumar Bagga executed the Sale Deed dated 9th March, 1999 in favour
of the appellant/defendant No.2 has also not been proved;
(X) attention is invited to the deposition recorded on 8th August,
1994 of the respondent No.2/defendant No.1 to highlight the
admission that the respondent No.2/defendant No.1 after receipt of
letter dated 13th May, 1986 from the respondent No.1/plaintiff had not
contacted the respondent No.1/plaintiff;
(XI) that the discrepancies with respect to the documents evidencing
the alleged transaction of sale of a date prior to the institution of the
suit are relevant as the appellant/defendant No.2 is attempting to
connect the Sale Deed dated 9th March, 1999 to the said transaction,
when it is not;
(XII) that though the Agreement to Sell dated 16th June, 1986 records
the sale consideration of Rs.60,000/- to have been paid under a
separate legal receipt but no such receipt has been proved;
(XIII) that though it was deposed that the said sale consideration was
paid by bank drafts but no such bank drafts have been proved;
(XIV) that the respondent No.1/plaintiff has never admitted sale of the
property prior to the institution of the suit;‟
(XV) that the Agreement to Sell dated 16th June, 1986 has not even
been proved and there is no attempt even to prove the same in the
affidavit by way of examination-in-chief of the appellant/defendant
No.2;
(XVI) that it is inexplicable as to why the Power of Attorney in
pursuance to the Agreement to Sell dated 16th June, 1986 would be
executed on 18th June, 1986 and registered on 11th July, 1986 and
possession delivered, as aforesaid, on 28th June, 1986;
(XVII) that the plea in the written statement of the appellant and the
respondent No.2 defendants of delivery of possession on 16th June,
1986 is falsified from the possession letter showing delivery of
possession on 28th June, 1986;
(XVIII) that if the sale was complete vide the document of 1986 why
the Sale Deed dated 9th March, 1999 would be executed after 13 years
and the same is also indicative of the sale vide Sale Deed dated 9th
March, 1999 being not relatable to the alleged transaction of 16th June,
1986;
(XIX) that the plea of Agreement to Sell dated 16th June, 1986 is an
afterthought and it is for this reason only that the respondent
No.2/defendant No.1 did not produce any document in support
thereof;
(XX) that similarly though the appellant/defendant No.2 appeared in
the suit for the first time on 13th July, 1989 but did not produce the
said documents for a period of 10 years till the year 1999;
(XXI) that the authenticity of the Agreement to Sell dated 16th June,
1986 could have been proved by examining the witnesses thereto
who have not been examined;
(XXII) that the admitted extension of the date fixed for completion of
the sale is also indicative of the respondent No.2/defendant No.1
being satisfied of the readiness and willingness of the respondent
No.1/plaintiff as else she would not have agreed to the extension;
(XXIII) alternatively, it is argued that even if the Sale Deed dated 9th
March, 1999 is relatable to the alleged transaction of 16th June, 1986
i.e. prior to the institution of the suit, even then the principle of lis
pendens would apply. Reliance in this regard is placed on Rajender
Singh Vs. Santa Singh (1973) 2 SCC 705 and Jayaram Mudaliar
Ayyaswami (1972) 2 SCC 200 laying down the genesis of the said
doctrine and it is contended that the sale during the pendency of a suit,
even if in pursuance to an earlier Agreement to Sell, will be hit by the
said doctrine;
(XXIV) that the Agreement to Sell does not create any rights in
immovable property;
(XXV) that even if a Sale Deed is considered as perfecting or
bettering the title/possession, the same amounts to variation of the
status quo existing on the date of the grant of interim order;
(XXVI) reliance is placed on Har Narain Vs. Mam Chand (2010) 13
SCC 128 laying down that a sale is not complete even on the
execution of the Sale Deed and until the registration thereof is
complete and that the registration does not relate back to the date of
execution of the Sale Deed and where the Sale Deed, though executed
prior to the institution of the suit, is registered after the institution of
the suit, the principle of lis pendens would apply;
(XXVII) reliance is also placed on:
(A) Raj Kumar Vs. Sardari Lal (2004) 2 SCC 601 laying
down that bringing of a lis pendens transferee on record, is not
as of right but in the discretion of the Court as a transferee
pendente lite is treated in the eye of law as a representative-in-
interest of the judgment-debtor and bound by the decree;
(B) Guruswamy Nadar Vs. P. Lakshmi Ammal (2008) 5
SCC 796 laying down that notwithstanding the subsequent
purchaser having purchased the property in good faith, in such
sale during the pendency of a suit, the principle of lis pendens
will certainly be applicable, notwithstanding the fact that under
Section 19(b) of the Specific Relief Act, his rights could be
protected;
(C) Joginder Singh Bedi Vs. Sardar Singh Narang 26
(1984) DLT 162 (DB) clarifying that the decision of the Court
is binding not only upon the litigant parties but also on those
who derive title under them by alienations made pending the
suit, whether such alienees had or had no notice of the pending
proceedings and also to contend that the Court in the said
judgment on the basis of discrepancies as in the present case
pertaining to the alleged transaction of 16th June, 1986 did not
believe the transaction besotted with such discrepancies;
(D) Surjit Singh Vs. Harbans Singh (1995) 6 SCC 50 laying
down that if alienation/assignment made in defiance of the
restraint order were to be permitted to be ignored, it would
defeat the ends of justice and be against the prevalent public
policy and that when the Court intends a particular state of
affairs to exist while it is in seisin of a lis, that state of affairs is
not only required to be maintained, but it is presumed to exist
till the Court orders otherwise;
(E) Arjan Singh Vs. Punit Ahluwalia (2008) 8 SCC 348
again laying down that a sale pendente lite would not come in
the Court‟s way in passing a decree of specific performance and
a transferee pendente lite would be deemed to be aware of the
pendency of the suit;
(F) Bhim Singh Vs. Amar Nath 149 (2008) DLT 34 again
laying down that it is immaterial whether the alienee pendente
lite had or had no notice of pending proceedings;
(G) Sh. Raj Kumar Sharma Vs. Smt. Pushpa Jaggi AIR
2006 Delhi 156 laying down firstly that the jurisdiction vested
in the Court to decline specific performance is a jurisdiction of
equity and good conscience and where an Agreement to Sell is
proved and the purchaser has acted without undue delay and has
pursued his remedy in accordance with law without infringing
the settled canon of equity, equity demands that the Agreement
be specifically performed and secondly that the law does not
impose an obligation on a purchaser to physically demonstrate
the availability of the balance sale consideration with him and it
is sufficient to prove that he posses or is capable of gathering
sufficient means to perform his part of the contract;
(H) Azhar Sultana Vs. B. Rajamani (2009) 17 SCC 27 also
laying down that it is not necessary that the entire amount of
consideration should be kept ready and the plaintiff must file
proof in respect thereof;
(I) Rambhau Namdeo Gajre Vs. Narayan Bapuji Dhotra
(2004) 8 SCC 614 laying down that the protection provided
under Section 53A of the Transfer of Property Act is only
against the transferor and it has nothing to do with the
ownership of the proposed transferor who remains full owner of
the property till it is legally conveyed by executing a registered
Sale Deed and that the right under Section 53A cannot be
pressed against a third party;
(J) Sujata Sanzgiry Vs. Ankush R. Naik AIR 2005 Bom.
404 laying down that the expression „transferee‟ under Section
19(b) of the Specific Relief Act contemplates a person to whom
the conveyance has been made and a person in whose favour a
conveyance or document of title has not been executed would
not be covered by Section 19(b) of the Specific Relief Act; an
Agreement for Sale subsequent to the original contract is out of
the purview of Section 19(b) of the Specific Relief Act (it is
also pointed out that SLP (Civil) No.24958/2005 preferred
against the said judgment was dismissed in limine on 13th
December , 2005.) (it is further pointed out that the same is not
the view of the Madras and Guwahati High Courts);
(K) Suraj Lamp & Industries Pvt. Ltd. Vs. State of Haryana
183 (2011) DLT 1 (SC) also laying down that the protection
under Section 53A of the Transfer of Property Act is available
only against the transferor and not against a third party and that
Agreement to Sell even if coupled with delivery of possession
and GPA, SPA and Will, cannot be treated as complete transfer
or conveyance;
(L) Narbad Devi Gupta Vs. Birendra Kumar Jaiswal JT
(2003) 8 SC 267 laying down that mere production and marking
of a document as exhibit by the Court cannot be held to be a due
proof of its contents till its execution has been proved by
admissible evidence i.e. by the evidence of those persons who
can vouchsafe for the truth of the facts in issue;
(J) P. D'Souza Vs. Shondrilo Naidu (2004) 6 SCC 649
laying down that readiness and willingness on the part of the
plaintiff to perform his part of the contract would also depend
on whether the defendant did everything which was required of
to be done in terms of the Agreement;
(K) that mere passage of long time and raising of
construction by the appellant/defendant No.2 will not create
equity in his favour;
(L) that the transferee pendente lite is liable to join the
respondent No.2/defendant No.1 in execution of conveyance in
favour of the respondent No.1/plaintiff.
23. The counsel for the appellant/defendant No.2 in rejoinder has argued:
(i) that the Supreme Court in Suraj Lamp & Industries Pvt. Ltd.
supra has clarified that Agreements entered into before the date of
pronouncement of that judgment i.e. 11th October, 2011 may be relied
upon to apply for regularization of allotments/leases by the
Development Authorities; that the Agreement dated 16th June, 1986 in
favour of the appellant/defendant No.2 is of much prior thereto and is
thus protected;
(ii) that the Bombay High Court in Sujata Sanzgiry supra was
concerned with a case where the full consideration had not been paid
and the possession had not been given and in fact did not follow its
earlier judgment in Mahadeo Keshav Lingarkar Vs. Shamrao
Balwant Keserkar AIR 1972 Bom 100 for the said reason;
(iii) that since no objection was taken to the proof of the Agreement
to Sell dated 16th June, 1986, the principle as laid down in Javer
Chand supra and in Dayamathi Bai Vs. K.M. Shaffi (2004) 7 SCC
107, will apply;
(iv) that the Supreme Court in Azhar Sultana supra refused specific
performance because the subsequent purchaser was in possession for
27 years and it was felt that he should not be forced to vacate;
(v) that the respondent No.1/plaintiff opposed the impleadment of
the appellant/defendant No.2 and which led to the delay;
(vi) that S.K.M. Mohammed Amanullah supra and Rajan supra
relied upon by the counsel for the respondent No.1/plaintiff are not
applicable as in those cases there was either no evidence to show
notice of the subsequent purchaser or the Agreement to Sell itself was
during the pendency of the suit, while the Agreement to Sell dated 16th
June, 1986 is of a date prior to the institution of the suit;
(vii) that the respondent No.1/plaintiff in the notice dated 13th May,
1986 did not say that he was ready and willing;
(viii) that the respondent No.1/plaintiff only had Rs.35,000/- in his
bank account and the NSEs referred to were to mature long thereafter
in the year 1991 and else no fixed deposits or jewelry was produced;
(ix) that the respondent No.1/plaintiff having paid only 11.3% of the
total sale consideration is not entitled to specific performance;
(x) that a careful perusal of the passbook produced by the
respondent No.1/plaintiff which is at page 651 of the Trial Court
record in fact shows availability of Rs.15,963.38 paise and not even
Rs.35,000/-.
24. The senior counsel for the respondent No.1/plaintiff in sur-rejoinder
has argued:
(a) that Hem Chandra De Sarkar Vs. Amiyabala De Sarkar AIR
1925 Calcutta 61 lays down that ordinarily when a party claimed
exception from a general provision of law, the onus lies upon him to
prove that he comes within the said exception and that the onus to
prove that the subsequent purchase was in good faith for valuable
consideration and without notice of the prior Agreement to Sell is on
the subsequent purchaser and not on the plaintiff in a suit for specific
performance;
(b) that though a Division Bench of this Court in Asha M. Jain
supra had held that judicial notice can be taken of the practice
prevalent in the city of Delhi of properties changing hands through the
medium of Agreement to Sell and accompanied by General Power of
Attorney and Will etc. but the Supreme Court in Suraj Lamp &
Industries Pvt. Ltd. supra has overruled the view of the Division
Bench of this Court; even otherwise in Asha M. Jain supra judicial
notice of such transactions where it was not possible to have the Sale
Deed executed was taken; here, there is nothing to show that as on
16th June, 1986 the Sale Deed could not have been executed in favour
of the appellant/defendant No.2;
(c) that house tax mutation is not title;
(d) that the distinction sought to be made out by the counsel for the
appellant/defendant No.2 from the view taken in Sujata Sanzgiry
supra is fallacious as the principle laid down therein is not based on
any facts;
(e) that Bishan Singh supra cited by the counsel for the
appellant/defendant No.2 relates to a case of preemption and will not
be thus applicable;
(f) that the Supreme Court in Nirmala Anand Vs. Advent
Corporation (P) Ltd. (2002) 5 SCC 481 has held that in cases of
contract for sale of immovable property, the grant of relief of specific
performance is the rule and its refusal an exception and that the
defendant cannot take advantage of his own wrong and then plead that
decree for specific performance would be an unfair advantage to the
plaintiff;
(g) reliance is placed on S.V.R. Mudaliar Vs. Rajabu F. Buhari
(1995) 4 SCC 15 laying down that before reversing a finding of fact,
an Appellate Court has to bear in mind the reasons ascribed by the
Trial Court;
(h) reliance is placed on Gobind Ram Vs. Gian Chand (2000) 7
SCC 548 laying down that where the seller tries to wriggle out of the
contract because of escalation in price, the purchaser is entitled to get
a decree for specific performance, as he has not taken any undue or
unfair advantage and it will be inequitable and unjust to deny the
decree after the two Courts had decided in his favour;
(i) reliance is placed on Prakash Chandra Vs. Angadlal AIR 1979
SC 1241 laying down that the relief of specific performance should
not be denied where the purchaser has acted fairly throughout and
there is nothing to show that by any act of omission or commission, he
encouraged the seller to enter into another transaction with respect to
the property and where the purchaser is not shown to have taken any
unfair advantage of the seller;
(j) that the readiness and willingness of the respondent
No.1/plaintiff could have been doubted only when he had been asked
to perform and had defaulted;
(k) that the respondent No.1/plaintiff could not have done anything
more;
(l) reliance is placed on Nathulal Vs. Phoolchand (1969) 3 SCC
120 to contend that if the contract is to be performed in a certain
sequence, one of the parties cannot require compliance with the
obligation of the other without in the first instance performing his
part;
(m) reliance is placed on Sukhbir Singh Vs. Brij Pal Singh (1997)
2 SCC 200 laying down that it is not a condition that the purchaser
should have ready cash with him and the fact that the purchaser
attended the Sub Registrar‟s office to have the Sale Deed executed
and waited for the seller is a positive fact to prove that the purchaser
has necessary funds to pass on consideration and had with him the
needed money for payment at the time of registration and that it is
sufficient for the purchaser to establish that he had capacity to pay the
sale consideration and it is not necessary for the purchaser to always
carry with him the money.
25. The counsel for the appellant/defendant No.2 in sur-sur-rejoinder
contended that the facts in Surjit Singh supra were entirely different.
26. I have considered the rival submissions and perused the Trial Court
record.
27. The agreement to sell dated 16th September, 1985 of which specific
performance was claimed in the suit and which is an admitted document
required the respondent no.2/defendant no.1 to, at the time of receipt of the
balance sale consideration of Rs.1,45,000/- from the respondent
no.1/plaintiff, hand over vacant physical possession of the property
consisting of three rooms, one kitchen, one bath room, one latrine and open
court yard in front side with electric and water fixtures and to sign the papers
in the Court in the name of respondent no.1/plaintiff or in the name of his
nominee latest by 31st December, 1985. The respondent no.2/defendant no.1
in the said agreement had also agreed not to enter into any agreement with
anyone in any manner whatsoever and not to encumber the property "in
future". It further provided that if the respondent no.2/defendant no.1 did so,
the respondent no.1/plaintiff would have full right to file a suit for specific
performance to get the possession of the property and to get the property
transferred either in his name or in the name of his nominee. The agreement
further required the respondent no.2/defendant no.1 to pay house tax,
electricity charges, water charges or any other dues and demands of the
concerned authority upto the date of handing over the physical vacant
possession of the property.
28. The two agreements of "extension" of the aforesaid agreement to sell
dated 16th September, 1985 are on stamp papers and hand written and which
handwriting was admitted by the respondent no.2/defendant no.1 to be hers.
The first of the said agreement is as under:
"Extension Agreement to sell dated 16.09.1985
An agreement to sell was signed between Smt. Chander Kanta w/o
Late Brij Mohan R/o 198/17A, Garhi (the seller) and Sh. Dewan
Chand Batra s/o Late Sh. Karan Chand Batra r/o 10A, Amrit Puri,
Garhi (the purchaser) on 16.9.1985 the last date of handing over the
physical possession of House and signing the papers in the court was
fixed 31.12.1985 in this agreement. Now the last date of handing
over the physical possession and making payment is extended latest
by 31st March, 1986. All other terms and conditions of the previous
agreement dated 16.9.85 will remain same."
and the second is as under:
"Extension of Agreement to Sell dated 16.9.1985 and 31.12.85.
As per Agreement of Sale dated 16.9.85 and further extension of the
same dated 30.12.85 between myself (Mrs. Chander Kanta) R/o
198/17A, Garhi and Sh. Dewan Chand R/o 207/2 Prakash Mohalla,
Garhi, the date of making the full and final payments by the
purchaser and handing over the physical possession by the seller
was fixed on or before 31.3.86, date of handing over the possession
is fixed on or before April, 30th 1986."
29. One thing which is immediately evident is that in both the agreements
the emphasis is on the last date agreed for handing over possession and for
extension thereof and though reference is also made to the payment to be
made at that stage but the emphasis nevertheless is on handing over
possession. In the ordinary course of human behaviour, if the date was
being extended at the instance of the purchaser and for the reason of the
purchaser i.e. the respondent no.1/plaintiff being not ready with the balance
sale consideration, the emphasis in the "extension" agreements would have
been on extension of the date of payment and not on the date of delivery of
possession, particularly when the seller i.e. the respondent no.2/defendant
no.1 was herself writing the said agreements in her own hand. Also, the
stamp papers on which the said two agreements are scribed were not only in
the name of the respondent no.2/defendant no.1 seller as distinct from the
stamp paper on which the agreement to sell dated 16th September, 1985 is
typed, which is in the name of the respondent no.1/plaintiff purchaser but the
stamp papers are bought from a different vendor than the stamp vendor from
whom the stamp paper for agreement to sell dated 16th September, 1985 was
bought. The stamp papers are shown to have been bought by the respondent
no.2/defendant no.1 seller on 28th December, 1985 and on 27th March, 1986
i.e. a couple of days prior to the last date fixed for completion of the sale.
30. Again, in the ordinary course of human behaviour if it was the
respondent no.1/plaintiff purchaser who had been wanting extension of time,
the stamp paper for the "extension" agreements would have been bought by
him and got prepared by him for obtaining the signatures thereon of the
respondent no.2/defendant no.1 seller.
31. The said factors lead me to believe the version of the respondent
no.1/plaintiff of the extension of time for completion of sale being at the
instance of the respondent no.2/defendant no.1 and to disbelieve the version
of the respondent no.2/defendant no.1 of the extension of the date for
completion of the sale being at the instance of the respondent no.1/plaintiff.
32. Though as aforesaid, the emphasis in the extension agreements is on
extension of the date for delivery of possession but it is neither the plea of
the respondent no.2/defendant no.1 nor her evidence (and this plea could not
have been taken by the appellant/defendant no.2) that the respondent
no.2/defendant no.1 was in a position to on or before 31st December, 1985
being the original date fixed for completion of the sale or on 31st March,
1986 or on 30th April, 1986 being the extended dates for completion of the
sale, to remove herself and her goods. It is the admitted position that the
respondent no.2/defendant no.1 at the time of agreement to sell dated 16th
September, 1985 was residing in the said property and that she had before
31st December, 1985 or before 31st March, 1986 or before 30th April, 1986
not acquired any other accommodation or made a provision for vacating the
subject property to deliver the vacant physical possession thereof to the
respondent no.1/plaintiff. In my opinion, when the main defence of the
respondent no.2/defendant no.1 was of the inability of the respondent
no.1/plaintiff to pay the balance sale consideration inspite of the respondent
no.2/defendant no.1 having agreed to give extension thereof and being
herself ready and willing and further when it was the specific plea of the
respondent no.1/plaintiff in the plaint that it was the respondent
no.2/defendant no.1 who was unable to deliver possession on the
dates/extended dates for completion of sale, it was incumbent upon the
respondent no.2/defendant no.1 to plead and prove that she was in a position
to deliver vacant possession of the property on the said dates by citing the
alternative property of which she had made provision by the said dates for
shifting her goods and family thereto.
33. This was more so when the suit was filed within three months of the
last date of 30th April, 1986 fixed for completion of the sale i.e. on 31st July,
1986.
34. There is another interesting facet. The respondent no.2/defendant no.1
in her cross examination of the respondent no.1/plaintiff recorded on 27th
February, 1992 put to him her own copies of the two extension agreements
and which were admitted by the respondent no.1/plaintiff. The said copies
also, though not on stamp paper are in the handwriting of the respondent
no.2/defendant no.1. The same is also indicative of the respondent
no.2/defendant no.1 having herself prepared the said documents and taken
them for the signature of the respondent no.1/plaintiff instead of being the
other way round.
35. The respondent no.2/defendant no.1 also admitted the examinations of
her sons in the months of March/April, 1986. The said admission also is
indicative of it being inconvenient to the respondent no.2/defendant no.1 to
shift out of the property/house in December, 1985 or on 31st March, 1986
and the extensions being at her request.
36. For the aforesaid additional reasons, the finding of the learned
Additional District Judge of the extensions of the date for completion of the
sale being not indicative of the inability of the respondent no.1/plaintiff to
pay the balance sale consideration but instead being at the instance of the
respondent no.2/defendant no.1 owing to her own inability to vacate the
premises, cannot be interfered with.
37. That brings me to the post 30th April, 1986 scenario.
38. Though the respondent no.1/plaintiff claims to have before that date
sent a letter dated 27th April, 1986 to the respondent no.2/defendant no.1 but
the only proof of dispatch thereof is a postal certificate and reference thereto
in the subsequent letter dated 13th May, 1986 receipt whereof is admitted by
the respondent no.2/defendant no.1. Since the respondent no.2/defendant
no.1 denied the receipt of the letter dated 27th April, 1986, I deem it
appropriate to ignore the same.
39. The respondent no.1/plaintiff in his letter dated 13th May, 1986
referred to the extensions aforesaid sought by the respondent no.2/defendant
no.1 and further extension till 30th May, 1986 also sought by the respondent
no.2/defendant no.1 giving the reason of the marriage and which was not
agreed to by the respondent no.1/plaintiff. The respondent no.1/plaintiff
wrote the said letter calling upon the respondent no.2/defendant no.1 to
vacate the house within ten days and to intimate to him the date of delivery
of possession and getting the payment.
40. Though undoubtedly the respondent no.1/plaintiff in the said letter did
not use the words of being ready and willing to perform his part of the
Agreement to Sell but it cannot be lost sight of that the said letter is written
by the respondent no.1/plaintiff himself and not by any advocate on his
behalf. Even otherwise a complete reading of the said letter leaves no
manner of doubt of the readiness and willingness of the respondent
no.1/plaintiff. The respondent no.1/plaintiff while calling upon the
respondent no.2/defendant no.1 to vacate the property within ten days also
requested the respondent no.2/defendant no.1 to intimate to him in writing
the date when the respondent no. 2/defendant no.1 would be so vacating the
property and delivering possession thereof and "getting the payment". It
may be highlighted that there is no mention in the said letter of execution of
the sale deed. The actions to be done, in the contemplation of the
respondent no.1/plaintiff, were only of getting the possession against the
payment.
41. The respondent no.2/defendant no.1 at least on 17th/18th May, 1986
i.e. soon after sending the legal notice dated 14th May, 1986 of termination
was aware of the demand of the respondent no .1/plaintiff in the letter dated
13th May, 1986. The respondent no.2/defendant no.1 admittedly did not still
ask the respondent no.1/plaintiff to make the payment.
42. On the contrary, the respondent no .1/plaintiff through advocate‟s
letter dated 19th May, 1986 responded to the legal notice of termination.
Even if it were to be believed that the respondent no.2/defendant no.1 as on
14th May, 1986 i.e. at the time of issuance of the legal notice of termination
was of the view that the respondent no.1/plaintiff was not ready and willing,
respondent no.2/defendant no.1 soon thereafter on 17th/18th May, 1986 was
aware of the demand of the respondent no.1/plaintiff. The least which was
expected of the respondent no.2/defendant no.1 was to give an opportunity
to the respondent no.1/plaintiff to make the payment.
43. No such opportunity was admittedly given, not even after receipt of
reply dated 19th May, 1986 of the advocate of the respondent no.1/plaintiff.
44. Further, the respondent no.2/defendant no.1 neither in her pleadings
nor in her evidence denied having gone to her native place on 30th April,
1986 for the wedding of Mr. Sisodia Sub Inspector. The same also shows
that the respondent no.2/defendant no.1 was even on 30th April, 1986 not in
a position to vacate the property.
45. This becomes further clear from the cross examination recorded on 8th
August, 1994 of the respondent no.2/defendant no.1. She though claimed to
have sold the house in June, 1986 but deposed to have shifted to Noida only
in the end of 1987. On being quizzed, though she explained that from June,
1986 till shifting to Noida she lived in a tenanted house partly at Mayur
Vihar Phase II and partly in Noida but did not prove the same. She further
deposed having completed the construction of her own house in Noida and
having shifted thereto only in December, 1987. In the absence of any proof
by the respondent no.2/defendant no.1 of having shifted out of the suit
property in June, 1986, the preponderance of probability suggests that the
respondent no.2 / defendant no.1 found a buyer who was willing to allow her
to continue in the premises till the end of the year 1987 and that she was not
in a position to vacate and deliver the possession of the property till then and
backed out from her transaction with the respondent no.1/plaintiff for this
reason only.
46. The respondent no.2/defendant no.1 claims to have made a distress
sale of the property for Rs.60,000/- i.e. at a price less than 50% of the price
which the respondent no.1/plaintiff had agreed to pay and had notified the
respondent no.2/defendant no.1 in his letter dated 13th May, 1986 that he was
willing to pay. The respondent no.2/defendant no.1 after the receipt on
17th/18th May, 1986 of the communication dated 13th May, 1986 of the
respondent no.1/plaintiff must have been aware of such drastic drop in prices
of the property in the area. It is again contrary to normal human behaviour
that the respondent no.2/defendant no.1 would still not ask the respondent
no.1/plaintiff to make the payment.
47. The settled principle of law has been that time is not of the essence in
transactions pertaining to immovable property unless so made of the
essence. Neither the agreement made the same of essence nor is it the plea
of the respondent no.2/defendant no.1 that time was the essence or at any
time made the essence. Rather the extensions admittedly agreed upon for
completion of sale negate time being of the essence.
48. Though the Supreme Court in Sardamani Kandappan Vs. S.
Rajalakshmi (2011) 12 SCC 18 has observed that time has come to change
the said principle but has not done so till now. However taking note of the
changing ground reality, the test of readiness and willingness has been made
more stringent. The transaction however pertains to the year 1986 when the
principle, of time being not ordinarily of the essence in such transactions
was well entrenched. The time lag between 30th April, 1986 being the date
agreed for performance and 14th May, 1986 i.e. of barely 15 days after which
the respondent no.2/defendant no.1 exercised the right of cancellation has to
be seen in the said context. The haste with which respondent no.2/defendant
no.1 proceeded to terminate the agreement is indicative of the respondent
no.2/defendant no.1 having changed her mind and being not in a position to
deliver possession of the property. Alternatively even if it were to be held
that the respondent no.1/plaintiff did not come forward within the agreed
time of 30th April, 1986 to make the payment, the respondent no.2/defendant
no.1 at least on 17th/18th May, 1986 after receipt of the letter dated 13th May,
1986 was aware of the readiness and willingness expressed by the
respondent no.1/plaintiff. The conduct of the respondent no.2/defendant
no.1 of not responding thereto or to the reply dated 19th May, 1986 shows
that the respondent no.2/defendant no.1 was not interested in receiving
payment of balance sale consideration from the respondent no.1/plaintiff and
wanted to renege from the agreement to sell.
49. I am therefore in conformity with the finding of the learned
Additional District Judge, of the breach being on the part of the respondent
no.2/defendant no.1 and not of the respondent no.1/plaintiff. Though in
view of the aforesaid and the judgments supra cited by the senior counsel for
the respondent no.1/plaintiff laying down that the purchaser cannot be ready
and willing in vacuum without the seller being ready to sell (applicable in
the present case as the respondent no.2/defendant no.1 seller has not
established being in a position to offer or deliver vacant possession) but still
for the sake of completeness I proceed to discuss the aspect of readiness and
willingness of the respondent no.1/plaintiff.
50. There is undoubtedly a plea in terms of Section 16(c) of the Specific
Relief Act. All that has to be thus seen is whether the respondent
no.1/plaintiff has failed to establish the same.
51. The respondent no.1/plaintiff in his examination-in-chief recorded on
15th May,1991 deposed that he was a teacher in DAV School and his wife
was also a teacher in a Government school; that they were at the
contemporaneous time drawing salary of Rs.3000/-p.m. and Rs.2200/- p.m.
respectively; that he had Rs.15,000/- in cash and Rs.35000/- in bank; that his
wife had been depositing her salary with her brother and had so saved nearly
Rs.1 lac; that he had a property in Faridabad and another property at Lajpat
Nagar; that he had sold the Lajpat Nagar property in the year 1983 and
purchased two plots in Sainik Nagar and the value was Rs.2 lacs.
52. I have perused the cross examination by the respondent
no.2/defendant no.1 of the respondent no.1/plaintiff and do not find any dent
to have been made to the said evidence of the readiness and willingness.
The arguments made by the counsel for the appellant/defendant no.2 in this
regard are on a misreading of the evidence.
53. I have also perused the cross examination by the appellant/defendant
no.2 of the respondent no.1/plaintiff conducted on 5th March, 2007 and do
not find any dent having been made therein also on the aspect of readiness
and willingness of the respondent no.1/plaintiff. The finding of the learned
Additional District Judge in this respect is also thus confirmed.
54. That leads to the question whether the defence under Section 19(b) of
the Specific Relief Act is available to the appellant/defendant no.2 as a
subsequent purchaser.
55. The position which emerges from the judgment supra is that the said
defence is not available where the subsequent purchase is during the
pendency of the suit.
56. The registered sale deed dated 9th March, 1999 in favour of the
appellant / defendant no.2 is certainly during the pendency of the suit and
would thus be hit by the principle of lis pendens. The question to be
considered is that even if the respondent no.2/defendant no.1 had entered
into an Agreement to Sell the property to the appellant/defendant no.2 on
16th June, 1986 i.e. before the institution of the suit on 31st July, 1986, and
executed the sale deed dated 9th March, 1999 in pursuance thereto, whether
the said principle of lis pendens not be applicable. In my opinion it would
be. An Agreement to Sell confers no right in the immovable property and
only confers a right to specific performance thereof. The law in this regard
is succinctly discussed in the judgment of this Court in Jiwan Das Vs.
Narain Das AIR 1981 Del 291 and has been followed in Sunil Kapoor Vs.
Himmat Singh 167 (2010) DLT 806. It was held that the Agreement to Sell
does not entitle the purchaser to exercise any right as owner of the property,
not even when a decree for specific performance is passed but till a
conveyance deed in pursuance thereto is registered. Though undoubtedly
the Division Bench of this Court in Asha M.Jain held that judicial notice
can be taken of the transactions pertaining to immovable property prevalent
in the city through the medium of agreement to sell coupled with delivery of
possession and accompanied by general power of attorney etc but it came to
be so held in the context of the rights to be exercised by a bank for recovery
of its dues from the said property. Even otherwise the Supreme Court in
Suraj Lamp & Industries Pvt. Ltd. has expressly overruled Asha M. Jain.
57. The contention of the counsel for the appellant/defendant no.2 that
Suraj Lamp & Industries Pvt. Ltd. being prospective would thus not apply
is not correct. As aforesaid this was the view of this Court as far back as in
Jiwan Das supra (1981). Moreover the protection afforded in Suraj Lamp &
Industries Pvt. Ltd. is for regularizing the transaction and cannot be used to
contend that rights in property were created by an Agreement to Sell.
Further the said protection is meant for claims of transferors after having
transferred the property in such manner.
58. Though I had during the hearing inquired whether the rights created in
Section 53A of the Transferor of Property Act are not title to the property
but from the judgments supra cited by the senior counsel for the
appellant/defendant no.2 it is clear that Section 53A is also intra-party only
and cannot affect a third party as the respondent no.1/plaintiff in the present
case is.
59. I may consider the matter from another aspect. If the sale deed dated
9th March, 1999 had not been executed and registered, the claim of the
appellant/defendant no.2 would have been on the basis of the Agreement to
Sell only. I tend to agree with the view taken by the Bombay High Court in
Sujata Sanzgiry supra that the title arising subsequently referred to in
Section 19(b) can be only title by way of a registered document and not by
way of Agreement to Sell. An agreement purchaser as aforesaid has no title
to the property and is at best a nominee of the seller. It is inconceivable that
a seller can defeat the sale by merely entering into an Agreement to Sell.
However I do not intend to take any final binding view in this regard as I am
of the opinion that the appellant/defendant no.2 has failed to prove that he
has paid money if any in good faith and without notice of the original
contract. The Agreement to Sell dated 16th June, 1986 is for a consideration
of Rs.60,000/- and consideration under the Sale Deed is of Rs.1,60,000/-.
The appellant / defendant no.2 prior to the execution of the Sale Deed
admittedly knew not only of the prior Agreement to Sell in favour of the
appellant/defendant no.2 but also of the pendency of the suit. The payment
by the appellant/defendant no.2 of Rs.1,60,000/- cannot thus be said to be in
good faith and without notice of the original agreement.
60. For the aforesaid reasons, I am of the view that the provisions of
Section 19(b) are not applicable to the appellant/defendant no.2.
61. There is thus no merit in the appeal, which is dismissed with costs.
Counsel‟s fee is assessed at Rs.25,000/-.
Decree sheet be drawn up.
RAJIV SAHAI ENDLAW, J.
th
JANUARY 20 2014
bs/M..
