Sri A Papanna vs Sri D M Patel
2023 Latest Caselaw 1464 Kant

                               1


    IN THE HIGH COURT OF KARNATAKA AT BENGALURU

         DATED THIS THE 21ST DAY OF FEBRUARY, 2023

                             BEFORE

             THE HON'BLE MRS. JUSTICE M G UMA

       REGULAR SECOND APPEAL NO. 714 OF 2017 (SP)

BETWEEN:

SRI. A. PAPANNA
S/O LATE ANNAIAH
AGED ABOUT 72 YEARS
RE/AT HINKAL VILLAGE
MYSORE TALUK
MYSORE DISTRICT - 570 017.
                                                ... APPELLANT

(BY MR: C.M. NAGABHUSHAN, A/W
    MR: ANANDA K., ADVOCATES)

AND:

SRI. D.M. PATEL
S/O M.M. PATEL
AGED ABOUT 64 YEARS
R/AT NO.10
INDUSTRIAL SUBURB
MYSURU - 570 016.
                                            ... RESPONDENT

(BY MR: CHANDRAKANTH R. GOULAY, ADVOCATE)

      THIS R.S.A. IS FILED UNDER SECTION 100 OF CPC AGAINST
THE JUDGMENT AND DECREE DATED: 23.01.2017 PASSED IN
R.A.NO.579/2016 ON THE FILE OF THE II ADDITIONAL DISTRICT
JUDGE, MYSURU, ALLOWING THE APPEAL AND MODIFIYING THE
JUDGMENT AND DECREE DATED: 13.04.2016 PASSED IN
OS.NO.1024/2007 ON THE FILE OF THE I ADDITIONAL SENIOR
CIVIL JUDGE AND CJM., MYSURU.
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     THIS R.S.A. HAVING BEEN HEARD AND RESERVED FOR
JUDGMENT ON 14.11.2022 COMING ON FOR PRONOUNCEMENT OF
ORDERS THIS DAY, THE COURT DELIVERED THE FOLLOWING:

                        JUDGMENT

The defendant is before this Court impugning the

judgment and decree dated 23.01.2017 passed in RA No.579

of 2016 on the file of the learned II Additional District Judge,

Mysuru (hereinafter referred to as 'the First Appellate Court'

for brevity), allowing the appeal and modifying the judgment

and decree dated 13.04.2016 passed in OS No.1024 of 2007

on the file of the learned I Additional Senior Civil Judge and

CJM, at Mysuru (hereinafter referred to as 'the Trial Court' for

brevity), and decreeing the suit of the plaintiff for specific

performance of the contract directing the defendant to

execute the registered sale deed by receiving a sum of

Rs.30,00,000/-.

2. For the sake of convenience, parties are referred

to as per their status and rank before the Trial Court.

3. Brief facts of the case are that, the plaintiff filed

the suit OS No.1024 of 2007 against the defendant seeking

specific performance of the contract i.e., the agreement to sell

dated 16.08.2004. It is the contention of the plaintiff that the

defendant approached him with an intention to sell 20 guntas

of land in Sy.No.4/2B situated at Hinkal Village, Mysuru Taluk,

proclaiming that he is the absolute owner in possession of the

property. The parties have agreed for a total consideration

amount of Rs.3,20,000/-. It was agreed to pay Rs.1,75,000/-

as advance and the balance amount at the time of executing

the sale deed. The defendant undertook to hand over the

possession of the property in favour of the plaintiff at the time

of executing the sale deed and also to hand over the original

documents. Accordingly, the agreement dated 16.08.2004

was executed and the same was registered by the defendant

after accepting the part consideration amount of

Rs.1,75,000/-.

4. It is contended by the plaintiff that after execution

of the sale agreement, he came to know that the land bearing

Sy.No.4/2B is involved in litigation under Urban Land (Ceiling

and Regulation) Act, 1976 (hereinafter referred to as 'ULC

proceedings' for brevity) and major portion of the land was

not free from encumbrance. Immediately, the plaintiff

approached the defendant who promised to settle all those

disputes as he has challenged the order passed by the Deputy

Commissioner, Mysuru before the High Court in Writ Petition

No.31306 of 2003. The defendant also promised to complete

the sale transaction as agreed and to hand over the

possession of the property immediately after disposal of the

writ petition and getting Sy.No.4/2B mutated in his name.

Accordingly, ULC proceedings ended in favour of the

defendant and his name was mutated in the revenue records

in respect of Sy.No.4/2B measuring 1.20 acres of Hinkal

Village.

5. It is contended that the defendant demanded the

balance consideration amount of Rs.1,45,000/- towards

litigation expenses and assured to execute the registered sale

deed by delivering the possession of the property.

Accordingly, the plaintiff paid the balance consideration

amount. Therefore, it is contended that the entire sale

consideration was paid by the plaintiff to the defendant. In

spite of that, the defendant was not ready and willing to

perform his part of the contract. The plaintiff issued the legal

notice, calling upon the defendant to perform his part of the

contract and to execute the sale deed as undertaken. The

defendant has neither replied nor complied with the demand

made by the plaintiff.

6. It is stated that the defendant had sent a legal

notice to the plaintiff on 28.03.2007 through his advocate

contending that he had executed the agreement for sale

dated 16.08.2004 in favour of the plaintiff and had received

Rs.1,75,000/- towards part sale consideration. It is contended

that the balance amount at the rate of Rs.1,000/- per square

feet is due and the time is the essence of the contract. It is

also stated in the notice that since the plaintiff was not ready

and willing to perform his part of the contract, the defendant

revoked the agreement of sale. The defendant knowing fully

well about the agreement dated 16.08.2004 and receipt of the

balance consideration amount, suppressed the same and

taken up a new contention.

7. It is also contended that the defendant even

though received the entire consideration amount of

Rs.3,20,000/- falsely claiming that the plaintiff is due in a

sum of Rs.1,45,000/-. The plaintiff in order to avoid the

controversy was ready to make the payment once again. It is

stated that the cause of action for the suit arose on

16.08.2004, when the agreement of sale is executed and

when the balance consideration amount is paid. Therefore,

prayed for a decree for specific performance of the agreement

to sell by accepting the balance consideration of

Rs.1,45,000/-.

8. The defendant appeared before the Trial Court

and filed the written statement denying the contention taken

by the plaintiff. Execution of the agreement dated

16.08.2004 and paying of the advance of Rs.1,75,000/- are

all denied. On the other hand, it is contended that the

plaintiff being a business man with an intention to acquire the

property had orally entered into a gentleman agreement with

the defendant agreeing for the sale consideration amount of

Rs.1,75,00,000/-, but to avoid income tax, to save the stamp

duty and registration charges, the consideration amount was

shown less. The defendant agreed for the same. It is

contended that time was the essence of the contract.

9. It is further contended that the plaintiff has

already filed another suit against the defendant in OS No.868

of 2007 seeking similar relief of specific performance of the

contract. Since the parties and the relief claimed in both the

suits are one and the same, it is contended that the suit is not

maintainable. The defendant contended that he entered into

the agreement for sale with the plaintiff in respect of the land

bearing Sy.No.4/2B measuring 20 guntas situated at Hinkal

Village with the boundaries mentioned therein. It was

mutually agreed that the sale consideration for the above said

property is Rs.1.75 crores, if the defendant gets quashed the

notification made under ULC Act in Writ Petition No.31306 of

2003 filed before this Court. The said writ petition came to be

disposed of on 28.06.2005. The agreement referred to by the

plaintiff was entered into only to produce before the

Department of Income tax and such other authority and to

save the stamp duty. Separate sale agreement has been

executed agreeing to pay the sale consideration of

Rs.30,00,000/- which was meant to be shown to the lenders

of the plaintiff. Taking advantage of these two agreements,

the plaintiff is seeking specific performance of the contract

under both the agreements, which is unsustainable in law.

10. It is contended that the plaintiff has filed OS

No.1025 of 2007 against the defendant seeking specific

performance of the agreement dated 28.07.2004. The

agreement dated 28.07.2004 and 16.08.2004 are one and the

same and are in respect of the same property. The

agreement dated 16.08.2004 is a registered agreement,

whereas agreement dated 28.07.2004 is an unregistered

agreement. Therefore, it is contended that the plaintiff is not

entitled for the relief of specific performance of the contract.

Accordingly, he prays for dismissal of the suit.

11. The plaintiff got amended the southern and

northern boundary of the schedule property by deleting the

earlier boundary shown as South: A Papanna's Land and

North:Sy.No.6, amended it as North: A Papanna's land and

South : Sy.No.6. An additional written statement came to be

filed after amendment of the plaint and contended that the

amendment was an afterthought and therefore, prayed for

dismissal of the suit.

12. Plaintiff filed rejoinder contending that the earlier

suit filed for specific performance of the contract came to be

decreed and the defendant has preferred RA No.143 of 2011

which was remanded for fresh disposal. It is contended that

the defendant is trying to make out a new case by filing

amended written statement and the same is liable to be

dismissed. The contention taken by the defendant that the

parties have entered into gentleman agreement to pay sale

consideration of Rs.1.75 crores to avoid income tax, stamp

duty etc., are all denied. It is contended that the defendant

deliberately suppressed the fact that there was litigation

pending with regard to ULC proceedings. The defence taken

by the defendant that OS No.868 of 2007 was filed in respect

of the same property is also denied. It is contended that the

plaintiff and the defendant mutually agreed under two

different agreement for purchase of two different properties,

measuring 20 guntas each, with different boundaries.

Therefore, it is stated that the contention taken in the written

statement are all false and untenable. It is also stated that

agreement dated 28.07.2004 and 16.08.2004 are quite

different in respect of two distinct properties and therefore,

prayed for decreeing the suit.

13. On the basis of these pleadings, the Trial Court

framed the following issues and additional issue for

consideration:

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(2) vÀ£Àß ¥Á°£À PÀgÁj£À°è£À PÀvÀðªÀåªÀ£ÀÄß AiÀiÁªÁUÀ®Æ ¤ªÀð»¸À®Ä ¹zÀÞ¤gÀĪÀÅzÁV gÀÄdĪÁvÀÄ ªÀiÁqÀÄvÁÛ£ÉAiÉÄÃ?

(3) ¥ÀæwªÁ¢AiÀÄÄ ªÀiÁgÁl ªÀiÁqÀ®Ä M¦àgÀĪÀ zÁªÁ D¹Û £ÀUÀgÀ ¨sÀÆ«Äw PÁAiÉÄÝ C£ÀéAiÀÄ «ªÁzÀzÀ°è EvÀÄÛ. CzÀ£ÀÄß DvÀ£ÀÄ ªÀÄgɪÀiÁazÁÝ£É JA§ÄzÁV ªÀÄvÀÄÛ CzÀÄ wêÀiÁð£ÀªÁzÀ £ÀAvÀgÀ PÀæAiÀÄ¥ÀvÀæ §gÉzÀÄPÉÆnÖ®è JA§ÄzÁV ªÁ¢ gÀÄdĪÁvÀÄ ªÀiÁqÀÄvÁÛ£ÉAiÉÄÃ?

(4) ¥ÀæwªÁ¢AiÀÄÄ vÁ£ÀÄ zÁªÁ D¹ÛAiÀÄ£ÀÄß ªÁ¢UÉ ªÀiÁgÁl ªÀiÁqÀ®Ä M¦à PÀæAiÀÄzÀ PÀgÁgÀÄ §gÉzÀÄPÉÆnÖgÀĪÀÅzÁVzÉ. DzÀgÉ PÀæAiÀÄzÀ ªÉÆvÀÛ 1 PÉÆÃn 75 ®PÀë gÀÆ.UÀ¼ÁVzÉ. ªÁ¢AiÀÄÄ ªÀåªÀºÁgÀ¸ÀÜ£ÁVzÀÄÝ ¸ÁÖöåA¥ï qÀÆånAiÀÄ£ÀÄß ªÀgÀªÀiÁ£À vÉjUÉ G½¸À®Ä ªÀÄvÀÄÛ £ÉÆÃAzÁªÀt ±ÀĮ̪À£ÀÄß PÀrªÉÄ ªÀiÁrPÉƼÀî®Ä £ÁªÀÄPÁªÀ¸ÉÜUÁV MAzÀÄ PÀgÁgÀ£ÀÄß §gɹPÉÆArgÀÄvÁÛ£É ªÀÄvÀÄÛ vÁ£ÀÄ D¹ÛAiÀÄ ¸ÀA§AzsÀzÀ J¯Áè «ZÁgÀUÀ¼À£ÀÄß DvÀ¤UÉ w½¹zÀÄÝ DvÀ£ÀÄ CzÀ£ÀÄß ¥Àj²Ã°¹ MAzÀÄ wAUÀ¼ÉƼÀUÁV D¹ÛAiÀÄ£ÀÄß Rjâ¸À®Ä M¦à PÀæAiÀÄzÀ PÀgÁgÀÄ ªÀiÁrPÉÆArzÁÝ£É. DzÀgÉ M¥ÀàAzÀzÀAvÉ MAzÀÄ wAUÀ¼ÉƼÀUÁV PÀæAiÀÄzÀ ¨ÁQ ºÀtªÀ£À£ÀÄß ¥ÁªÀw ªÀiÁr®è, vÀ£Àß ¥Á°£À PÀgÁj£À PÀvÀðªÀåªÀ£ÀÄß ¤ªÀð»¸À®Ä

AiÀiÁªÁUÀ®Æ ¹zÀݤ®è. ¸ÀªÀÄAiÀĪÉà PÀgÁj£À ªÀÄÄRå CA±À (time is

essence of contract) JA§ÄzÁV gÀÄdĪÁvÀÄ ªÀiÁqÀÄvÁÛ£ÉAiÉÄÃ?

(5) zÁªÁªÀ£ÀÄß ªÀiË°åÃPÀj¹gÀĪÀÅzÀÄ, £ÁåAiÀiÁ®AiÀÄPÉÌ ±ÀÄ®Ì ¥ÁªÀw ªÀiÁrgÀĪÀÅzÀÄ ¸Àj¬Ä®è. ªÀiÁgÀÄPÀmÉÖ ¨É¯ÉAiÀÄ ªÉÄÃ¯É zÁªÁªÀ£ÀÄß ªÀiË°åÃPÀj¸À¨ÉÃPÁVvÀÄÛ JAzÀÄ ¥ÀæwªÁ¢AiÀÄÄ gÀÄdĪÁvÀÄ ªÀiÁqÀÄvÁÛ£ÉAiÉÄÃ?

(6) ¤¢üðµÀÖ ¥Á®£ÉUÁV rQæ ªÀiÁrzÀ°è CxÀªÁ ªÀiÁqÀzÉà EzÀÝ°è AiÀiÁªÀ ¥ÀPÀëUÁgÀ¤UÉ ºÉaÑ£À ºÁ¤ GAmÁUÀÄvÀÛzÉ? ¥ÀPÀëUÁgÀgÀÄ AiÀiÁªÀ ¥ÀjºÁgÀ ºÉÆAzÀ®Ä CºÀðgÀÄ?"

Additional issue:

"Whether the defendant proves that, the suit schedule property covered under agreement of sale dated 16.08.2004 and property covered under agreement of sale dated 28.07.2004 are one and the same, as contended in para 14(b) of the amended written statement?"

14. The plaintiff examined himself as PW1 and got

marked Exs.P1 to P10 in support of his contention. The

defendant examined himself as DW1 and examined DWs.2

and 3 and got marked Exs.D1 to 17 in support of his defence.

The Trial Court after taking into consideration all these

materials on record, answered issue Nos.1, 3 and 4 partly in

the Affirmative and issue Nos.2 and 5 and additional issue

No.1 in the Negative, accordingly, decreed the suit of the

plaintiff in part. The prayer for specific performance of the

contract was rejected. The defendant was directed to repay

Rs.1,75,000/- paid under the agreement - Ex.P.1, with

interest at 12% p.a. from the date of agreement till the date

of realization.

15. Being aggrieved by the same, the plaintiff has

preferred RA No.579 of 2016. The First Appellate Court on re-

appreciation of the materials on record, allowed the appeal

with costs and decreed the suit for specific performance of the

contract directing the plaintiff to pay additional sum of

Rs.30,00,000/- to the defendant. Being aggrieved by the

same, the defendant is before this Court.

16. Heard Sri C M Nagabhushan and Sri K Ananda,

learned counsel for the appellant and Sri Chandrakanth R

Goulay, learned counsel for the respondent. Perused the

materials on record including the Trial Court records.

17. Learned counsel for the appellant contended that

the plaintiff has filed OS No.1025 of 2007 before the Trial

Court in respect of similar agreement dated 28.07.2004,

alleging that the defendant had agreed to sell the schedule

property and therefore sought for specific performance of the

contract. The said suit was partly allowed directing the

defendant to pay Rs.30,00,000/-. But the prayer of the

plaintiff for specific performance of the contract was rejected.

The said judgment directing payment of the amount was

challenged by the defendant by preferring the first appeal

before this Court, which is still pending for consideration.

However, the co-ordinate Bench of this Court directed the

defendant to deposit 50% of the amount and accordingly, the

amount was deposited. The plaintiff had withdrawn the said

amount. The plaintiff had never challenged the judgment

refusing specific performance of the contract i.e., the

agreement dated 28.07.2004. On the other hand, he

accepted the judgment by withdrawing the amount that was

deposited by the defendant.

18. Learned counsel further submitted that the plaintiff

contended that similar agreement was also entered into

between the parties on 16.08.2004 and filed the present suit

seeking specific performance of the contract. There is no

explanation as to why two different agreements for sale were

entered into in respect of the same property. There is also no

explanation as to why the second suit for specific performance

of the contract was filed by the plaintiff when his first suit is

already partly decreed and specific performance of contract

was refused. Learned counsel further submitted that the Trial

Court and the First Appellate Court recorded a concurrent

finding that the subject matter of the agreements dated

28.07.2004 and 16.08.2004 are one and the same. The

plaintiff had never challenged such finding recorded by the

Trial Court and the First Appellate Court and thereby accepted

the said finding. Under such circumstances, the present suit

for specific performance of the contract in respect of the same

property, is not maintainable.

19. Learned counsel further submitted that even

according to the plaintiff, the time fixed for performance of

the contract is two months from 16.08.2004. The sale

consideration is said to be Rs.3,20,000/- and the plaintiff

contended that the entire amount of consideration is already

paid. However, during cross examination he admits that he

has not paid the entire consideration amount, but some

amount is due to be paid to the defendant. This shows the

conduct of the plaintiff who seeks specific performance of the

contract.

20. Learned counsel also submitted that the plaintiff

issued the legal notice as per Ex.P2 on 12.03.2007 i.e., after

lapse of more than 2½ years after entering into the

agreement in question. The said notice was never served on

the defendant. The defendant issued the notice as per Ex.P6

on 28.03.2007 repudiating the contract as the plaintiff was

not ready and willing to perform his part of the contract. In

spite of that, the plaintiff has not stated anything in the plaint

regarding his readiness and willingness to perform his part of

the contract, thereby, he has not complied with the

requirements of Section 16(c) of the Specific Relief Act.

21. It is further contended that the second agreement

dated 16.08.2004 is a sham document and it is unenforceable

in law. It is stated that the first agreement for sale is dated

28.07.2004. The total consideration agreed to be paid was

Rs.30,00,000/-, but under the second agreed dated

16.08.2004 the consideration agreed is only Rs.3,20,000/-.

There is absolutely no explanation for this disparity in the

amount agreed to be paid as consideration. Even according to

the plaintiff, the consideration agreed under Ex.P2 is

inadequate which is a valid reason to deny specific

performance of the contract as per Explanation-2 of Section

25 of the Contract Act. The Trial Court on proper appreciation

of the materials on record, rejected the prayer of the plaintiff

for specific performance of the contract. However, the First

Appellate Court without proper appreciation of the materials

on record, decreed the suit of the plaintiff. The finding

recorded by the First Appellate Court that the plaintiff was not

aware of ULC proceedings, is erroneous.

22. Learned counsel further stated that the plaintiff had

filed an application before the First Appellate Court seeking

permission to amend the plaint by inserting a paragraph to

plead his readiness and willingness to perform the contract.

The said application came to be rejected by the First Appellate

Court, but however decreed the suit of the plaintiff without

there being any pleading regarding readiness and willingness

to perform the contract.

23. Learned counsel contended that Ex.P1 is a

registered document and Ex.P4 is an unregistered document.

Ex.P4 is already enforced by the plaintiff by filing a suit for

specific performance of the contract. The Trial Court rejected

the claim for specific performance of the contract and ordered

for refund of the amount already paid. Under such

circumstances, the plaintiff cannot now seek for enforcement

of Ex.P1, solely on the ground that it is a registered

document. Learned counsel drawn the attention of this Court

to Ex.P2 to contend that the plaintiff issued the legal notice

demanding specific performance of the contract, alternatively

claimed huge sum of Rs.20,55,000/- with interest at 18% p.a.

There is absolutely no basis for claiming such a huge amount

when the consideration amount itself is only Rs.3,20,000/-

and he paid an amount of Rs.1,75,000/- as advance. This

shows the conduct of the plaintiff to take advantage of the

situation.

24. It is also contended that the First Appellate Court

referred to the financial capacity of the plaintiff by referring to

the withdrawal of the amount deposited by the defendant on

24.04.2013, but it had not taken into consideration the fact

that no materials are placed before the Court to determine the

financial capacity of the plaintiff from 2004 till 2007. He

placed reliance on the decisions in Ravi Setia Vs. Madan lal

and others1 and U.N. Krishna Murthy (since deceased

through Lr's) Vs. A.M.Krishnamurthy2 in support of his

contentions. Therefore, the impugned judgment and decree

passed by the First Appellate Court was perverse, erroneous

and calls for interference by this Court. Hence, he prays for

allowing the appeal.

25. Per contra, learned counsel for the respondent

submitted that the plaintiff has proved execution of Ex.P1 -

the agreement for sale dated 16.08.2004. It is a registered

agreement for sale. The First Appellate Court never held that

the subject matter of the agreement dated 28.07.2004 and

the schedule property are one and the same. On the other

hand, the finding on additional issue No.1 recorded by the

First Appellate Court disclose that both the properties are

different. Learned counsel further submitted that Ex.P1 -

agreement is dated 16.08.2004 and before expiry of the

period of limitation, the legal notice as per Ex.P2 was issued

(2019) 9 SCC 381

AIR 2022 SC 3361

on 12.03.2007. There was no reply by the defendant.

However, a notice as per Ex.P6 was issued terminating the

agreement in question. The defendant himself had filed an

application seeking appointment of a Commissioner for

identification of the schedule property. The same came to be

rejected by the Trial Court. The defendant had filed writ

petition challenging the order of the Trial Court, but the writ

petition also came to be dismissed.

26. Learned counsel further contended that normally

the time is not considered as the essence of the contract. The

First Appellate Court assigned valid reasons to hold that the

plaintiff was ever ready and willing to perform his part of the

contract. The conduct of the defendant from the date of

agreement was also considered by the First Appellate Court in

decreeing the suit of the plaintiff. Learned counsel further

submitted that the defendant has consciously entered into

Ex.P1 with the plaintiff. There is absolutely no reason as to

why the agreement is to be ignored. The First Appellate Court

on re-appreciation of the materials on record arrived at a right

conclusion. There is no perversity or illegality in the

impugned judgment and decree. Since there is no merits in

the appeal, the same is liable to be dismissed. Accordingly, he

prays for dismissal of the appeal with costs.

27. The appeal was admitted vide order dated

01.12.2021 and the following substantial questions of law

were formulated:

"1) Whether the first appellate court was justified in decreeing the suit in the absence of necessary pleadings with regard to readiness and willingness of the plaintiff to perform his part of the contract and having regard to Section 16(c) of the Specific relief Act?

             2)         whether the judgment and decree
       passed      by     the   first   appellate   court    is   in

compliance of the requirements of Order 41 Rule 3 of CPC?"

28. This Court vide order dated 31.10.2022 has

formulated the following additional substantial question of

law:

"Whether the First Appellate Court was justified in allowing the appeal and decreeing the suit of the plaintiff by answering point No.2 in favour of the plaintiff, when a categorical finding

on point No.1 is recorded and answered it in favour of the defendant?"

29. It is the specific contention of the plaintiff that the

defendant had executed the agreement for sale dated

16.08.2004 agreeing to sell 20 guntas of land bearing Survey

No.4/2B situated at Elkal village Mysuru taluk for a total

consideration of Rs.3,20,000/-. An amount of Rs.1,75,000/-

was paid in advance and it was agreed that the balance

consideration amount would be paid at the time of registration

of the sale deed. The agreement was registered. It was also

contended that when the plaintiff approached the defendant

about the ULC proceedings which was pending in respect of

the schedule property, he promised to settle it and demanded

for the balance consideration amount. Accordingly, the

plaintiff paid balance amount of Rs.1,45,000/-. Since the

defendant was not ready to execute the sale deed, the legal

notice came to be issued. In the meantime, the defendant

also issued a notice terminating the agreement, contending

that, time is the essence of contract and the plaintiff is not

willing and ready to perform his part of the contract and

therefore, the agreement was revoked. Thus, it is the

contention of the plaintiff that even though, he was ready and

willing to perform his part of the contract, the defendant was

not ready to execute the sale deed and therefore, sought for

specific performance of the contract.

30. On going through the pleadings of the plaintiff

before the Trial Court, it is clear the plaintiff has not

specifically averred that he was ready and willing to perform

his part of the contract. On the other hand, he contended

that entire consideration of Rs.3,20,000/- was already paid

and nothing is due to be paid. However, it is stated that the

plaintiff to avoid controversy is ready to make payment of

Rs.1,45,000/- for the second time. With these pleadings, the

parties went to adduce the evidence before the Trial Court.

During cross examination of PW1, he categorically admitted

that the entire amount of consideration was not paid by him.

This admission of the plaintiff assumes importance in view of

Section 16(c) of the Specific Relief Act. When the plaintiff fails

to prove his readiness and willingness to perform his part of

the contract, he will not be entitled for specific performance of

the contract.

31. It is pertinent to note that when the defendant

challenged the impugned judgment and decree passed by the

Trial Court before the First Appellate Court, the plaintiff had

filed an application seeking permission to amend the

pleadings i.e., to insert a paragraph regarding his readiness

and willingness to perform the contract. The said application

was accompanied by an affidavit sworn by the plaintiff,

wherein he had categorically stated that he could not plead

readiness and willingness in the plaint as the same was

omitted by mistake. Therefore, it is clear that even the

plaintiff admitted that there is no pleading regarding his

readiness and willingness to perform his part of the contract,

in the plaint. The conduct of the plaintiff in contending that

he had already paid the entire balance consideration amount,

but admitting during cross examination that he had not paid

the entire balance consideration amount and some amount is

due from him to be paid to the defendant also assumes

importance while deciding the readiness and willingness of the

plaintiff to perform the contract.

32. The Hon'ble Apex Court in Katta Sujatha Reddy

and another Vs Siddamsetty Infra Projects Private

Limited and Others3, considered the question regarding the

readiness and willingness to perform the contract and held in

paras 66 and 67, which reads as under:

"66. The next aspect which this Court needs to consider is whether the parties had requisite willingness and readiness to perform the contract. The aforesaid requirement is one of the essential ingredients under Section 16 of the Specific Relief Act, 1963 which reads as under:

"16. Personal Bars to relief.-Specific Performance of a contract cannot be enforced in favour of a person-

(c) who fails to aver and prove that he has performed or has always been ready and willing to perform the essential terms of the contract which c are to be performed by him, other than terms the performance of which has been prevented or waived by the defendant."

67. It is clear that in order to prove readiness and willingness, the burden is on the purchaser to prove that they were always ready

(2023) 1 SCC 355

and it is only the vendor who refused to perform the contract for extraneous considerations."

33. The Hon'ble Apex Court in U.N Krishnamurthy

(supra), considered the requirement of pleading and proving

the readiness and willingness on the part of the plaintiff to

perform his part of the contract and considering its various

decisions rendered earlier, held in paras 25 and 30 as under:

"25. To aver and prove readiness and willingness to perform an obligation to pay money, in terms of a contract, the plaintiff would have to make specific statements in the plaint and adduce evidence to show availability of funds to make payment in terms of the contract in time. In other words, the plaintiff would have to plead that the plaintiff had sufficient funds or was in a position to raise funds in time to discharge his obligation under the contract. If the plaintiff does not have sufficient funds with him to discharge his obligations in terms of a contract, which requires payment of money, the plaintiff would have to specifically plead how the funds would be available to him. To cite an example, the plaintiff may aver and prove, by adducing evidence, an arrangement with a financier for disbursement of adequate funds for timely compliance with the

terms and conditions of a contract involving payment of money.

30. This Court, in effect, held that for determining whether the Plaintiff was ready and willing to perform his part of the agreement it is necessary for the Court to consider the conduct of the Plaintiff prior and subsequent to filing the suit for specific performance. The relevant part of the judgment is extracted hereinbelow:-

"5. ...Section 16(c) of the Act envisages that plaintiff must plead and prove that he had performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than those terms the performance of which has been prevented or waived by the defendant. The continuous readiness and willingness on the part of the plaintiff is a condition precedent to grant the relief of specific performance. This circumstance is material and relevant and is required to be considered by the court while granting or refusing to grant the relief..."

34. Thus, the position of law is very well settled that

the plaintiff has to plead and prove his readiness and

willingness to seek the decree for specific performance of the

contract, which is lacking in the present case. When the

plaintiff admits that he had not paid the entire consideration

amount and also admits that there was no pleading in the

plaint regarding his readiness and willingness to perform his

part of the contract, the plaintiff is not entitled for grant of

specific performance of the contract.

35. Admittedly, there were two agreements entered

into between the plaintiff and defendant, wherein, the

defendant had agreed to sell the specified property in favour

of the plaintiff. The suit agreement is dated 16.08.2004

whereas the other agreement is dated 28.07.2004.

Admittedly, the plaintiff filed suit OS No.1025 of 2007 seeking

specific performance of the contract in respect of the

agreement dated 28.07.2004. The said suit came to be

decreed in-part directing the defendant to refund an amount

of Rs.30,00,000/-, but refused to grant specific performance

of the contract. The said judgment was not challenged by the

plaintiff. The defendant challenged it. While granting stay of

the impugned judgment and decree passed by the Trial Court,

the First Appellate Court directed the defendant to deposit

50% of the amount and accordingly, the defendant deposited

the amount. It is not in dispute that the plaintiff had

withdrawn the said amount of 50% of the decreetal amount.

36. In the meantime, the plaintiff filed the present suit

seeking specific performance of the contract dated

16.08.2004. The description of the schedule property in both

the suits are identical except in stating the western boundary.

In OS No.1025 of 2007, the western boundary is mentioned

as ring road and in the present case it is mentioned as road.

The plaintiff during cross examination specifically stated that

the schedule property in the present case is abutting the ring

road and also admits its boundaries. The First Appellate Court

framed the specific point for consideration as to whether the

schedule property in OS No.1024 of 2007 was identical with

the schedule property in OS No.1025 of 2007 and recorded a

categorical finding that the properties are identical. The

plaintiff accepted this finding and has never challenged the

same.

37. Now, I have to consider what is the effect of the

finding of First Appellate Court that the schedule properties in

both the suits are identical. When there are two agreements

in respect of the same property i.e., one dated 28.07.2004

and the other one dated 16.08.2004, the plaintiff has to

choose as to which of the agreement he would chose to seek

specific performance of the contract from the defendant. The

agreement dated 16.08.2004 which is referred to in this suit

is a registered agreement, but the fact remains that the

plaintiff has already enforced the agreement dated

28.07.2004 and obtained a decree for refund of an amount of

Rs.30,00,000/-. The said judgment was never challenged by

the plaintiff. When the defendant deposited 50% of the

decreetal amount before the Court as per the directions of the

First Appellate Court, the plaintiff has chosen to withdraw the

said amount and thereby accepted the judgment rejecting the

claim for specific performance of the contract and decreeing

the suit for only refund of the amount.

38. Now, the question arises as to whether the

plaintiff can enforce the agreement dated 16.08.2004 after

enforcing the agreement dated 28.07.2004 in respect of the

same property. Naturally, the answer will be in the Negative.

The First Appellate Court held that there is no bar for entering

any number of agreements in respect of a property between

the parties, but that does not mean to say that the plaintiff

can enforce all such agreements. The plaintiff has to chose

between the agreements to seek enforcement of the contract.

Under such circumstances, the plaintiff now cannot contend

that these two agreements are separate and distinct relating

to different properties. He also cannot maintain the suit for

enforcing the second agreement, after enforcing the first

agreement in respect of the same property. When the plaintiff

has not chosen to challenge the decree passed in OS No.1025

of 2007 refusing to grant specific performance of the contract,

he cannot contend that he is entitled for the decree for

specific performance of the contract in the present suit.

39. The agreement dated 16.08.2004 was entered into

between the plaintiff and defendant in respect of the schedule

property for a total consideration Rs.3,20,000/- and the

defendant accepted advance amount of Rs.1,75,000/-. It was

agreed between the parties that the balance amount is to be

paid by the plaintiff and the defendant has to execute the

same within two months from the date of agreement. But the

plaintiff got issued the notice as per Ex.P2, calling upon the

defendant to execute the sale deed only on 12.03.2007, which

was also not served on the defendant. In the meantime, the

defendant issued notice as per Ex.P6, repudiating the contract

on the ground that the plaintiff was not ready and willing to

perform his part of the contract. It is only thereafter the

plaintiff has filed the present suit on 19.06.2007.

40. As per Section 55 of the Contract Act, when a

party to the contract promises to do a certain thing at or

before a specified time, and if he fails to do so at or before

the specified time, the contract become voidable at the option

of the promisee when the intention of the parties was that,

the time is the essence of the contract. In the present case,

both the parties entered into an agreement fixing the time for

performance of the contract as two months from the date of

contract. The plaintiff kept quite for about three years to seek

specific performance of the contract from the defendant and

had filed the suit just about two months earlier to the expiry

to the period of limitation.

41. The First Appellate Court even after recording its

categorical finding that the subject matter of the suit OS

No.1024 of 2007 was identical with the suit property in OS

No.1025 of 2007, proceeded to decree the suit of the plaintiff

without any basis. As already discussed above, the finding of

the First Appellate Court that the parties are free to enter into

any number of contracts cannot be the basis to enforce the

second agreement in respect of the same property after

enforcing the first agreement. The First Appellate Court even

after observing the conduct of the plaintiff in not approaching

the defendant with the balance consideration amount, on the

other hand, contending that the entire sale consideration

amount is paid, however admitting during cross examination

that the balance amount is still due to be paid, proceeded to

decree the suit which is nothing but perverse and illegal.

Similarly, the First Appellate Court even after dismissing the

application filed by the plaintiff seeking amendment of the

plaint with regard to his readiness and willingness to perform

the contract could not have decreed the suit for specific

performance of the contract.

42. The finding of the First Appellate Court regarding

the financial condition of the plaintiff to pay the balance

consideration amount is also erroneous as it has taken into

consideration the withdrawal of an amount of about

Rs.17,00,000/- on 30.04.2013 as per Ex.D6, ignoring the fact

that the date of agreement is 16.08.2004 and the period fixed

for payment of balance consideration was two months. The

financial condition of the plaintiff after about 13 years is of no

help to the plaintiff to decide his financial condition to perform

his part of the contract.

43. Thus, I am of the opinion that the suit of the

plaintiff for specific performance of the contract was liable to

be dismissed. The First Appellate Court committed an error in

decreeing the suit of the plaintiff. Therefore, the same are to

be set aside. In the result, the suit of the plaintiff for specific

performance of the contract is dismissed. Since the Trial

court was right in directing the defendant to refund the

amount of Rs.1,75,000/- which was admittedly paid by the

plaintiff under Ex.P1, the said judgment and decree is

required to be restored.

44. From the discussions held above, the substantial

questions of law Nos.1 and 3 are to be answered in favour of

the defendant - appellant and against the plaintiff -

respondent. Learned counsel for the appellant has not

addressed any argument about the substantial question of law

No.2, hence, the same is answered against the appellant.

45. Hence, I proceed to pass the following:

ORDER

(i) The appeal is allowed with cost, through out.

(ii) The judgment and decree dated 23.01.2017 passed

in RA No.579 of 2016 on the file of the learned II

Additional District Judge, Mysuru, is hereby set aside.

(iii) The judgment and decree dated 13.04.2016, passed

in O.S No.1024 of 2007 on the file of the learned I

Additional Senior Civil Judge and CJM, at Mysuru is

restored.

Registry is directed to send back the Trial Court records

along with copy of this judgment.

Sd/-

JUDGE

*bgn/-SKS