Karnataka High Court
M/S Megacity Developers And Builders ... vs Sri B R Krishnamurthy on 22 February, 2024
Author: Chief Justice
Bench: Chief Justice
1
RFA NO.1548/2021 C/W
RFA NO.1547/2021
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 22ND DAY OF FEBRUARY, 2024
PRESENT
THE HON'BLE MR.P. S.D INES H KUMA R, C HIEF J UST ICE
AN D
THE HON'BLE MR. JUSTICE T.G.SHIVASHANKARE GOWDA
RFA NO.1548 OF 2021 C/W
RFA NO.1547 OF 2021 (SP)
BETWEEN:
M/S MEGACITY DEVELOPERS AND BUILDERS LTD.
NO.1, CHANDRALOKA, 5TH CROSS, GANDHINAGARA
BENGALURU 560 009, REP. BY ITS MANAGING DIRECTOR,
SRI C P YOGESHWAR
...APPELLANT
[COMMON IN BOTH APPEALS]
(BY SRI.UMESH MOOLIMANI, ADV.)
AND:
1. SRI J D M MANJUNATH
S/O J D M SIDDAPPA
AGED ABOUT 60 YEARS
R/AT NO 45, GOVINDAPPA ROAD
BASAVANAGUDI, BENGALURU 560 004
AND AT PRESENT R/AT JAGLURU VILLAGE
JAGALURU TALUK, CHITRADURGA DISTRICT
2. SRI Y BHASKAR
S/O NARAYANA
AGED ABOUT 41 YEARS
R/AT NO 45, 1 FLOOR
INDUSTRY HOUSE
RACE COURSE ROAD
BENGALURU 560 001 ... RESPONDENTS
[IN RFA NO.1548/2021]
(BY SRI.V.SRINIVASAN RAGHAVAN, SENIOR ADV. FOR
SRI.H.S.SOMNATH, ADV. FOR R2;
VIDE ORDER DATED 04.12.2023
NOTICE TO R1 IS DISPENSED WITH)
2
RFA NO.1548/2021 C/W
RFA NO.1547/2021
AND:
1. SRI.B.R.KRISHNAMURTHY
S/O B.R.RAMASWAMY
AGED ABOUT 60 YEARS
R/AT NO.106, SPM ROAD
SHIMOGA
2. Y BHASKAR
S/O NARAYANA
AGED ABOUT 41 YEARS
R/AT NO 45, 1 FLOOR
INDUSTRY HOUSE
RACE COURSE ROAD
BENGALURU 560 001 ... RESPONDENTS
[IN RFA NO.1547/2021]
(BY SRI.V.SRINIVASAN RAGHAVAN, SENIOR ADV. FOR
SRI.H.S.SOMNATH, ADV. FOR R2;
VIDE ORDER DATED 04.12.2023
NOTICE TO R1 IS DISPENSED WITH)
THESE APPEALS ARE FILED UNDER SECTION 96 OF CPC.,
AND READ WITH ORDER 41 RULE 1 OF CPC., AGAINST THE
JUDGMENT AND DECREE DATED 08.12.2020 PASSED IN
O.S.NO.310/2012 AND 308/2012 ON THE FILE OF THE
ADDITIONAL SENIOR CIVIL JUDGE AND JMFC., RAMANAGARA
PARTLY DECREEING THE SUIT FOR SPECIFIC PERFORMANCE
AND SALE AGREEMENT IN MFA NO.1547/2021.
THESE APPEALS HAVING BEEN HEARD AND RESERVED
FOR JUDGMENT ON 02.02.2024 AND COMING ON FOR
PRONOUNCEMENT OF JUDGMENT THIS DAY,
T.G.SHIVASHANKARE GOWDA J., DELIVERED THE
FOLLOWING:
3
RFA NO.1548/2021 C/W
RFA NO.1547/2021
JUDGMENT
In these two appeals, the plaintiff has challenged
the judgment and decree dated 08.12.2020 passed in
O.S.Nos.310/2012 and 308/2012 by the Additional
Senior Civil Judge and JMFC., Ramanagara (for brevity
'the Trial Court').
2. In both suits, plaintiff and defendant No.1 are
common and the facts pleaded and the issues framed,
evidence relied upon by the parties are identical,
hence, taken up together for common disposal.
3. For the sake of convenience, parties shall be
referred to as per their status before the Trial Court.
4. Brief facts of the case in O.S.No.310/2012
are, the defendant No.1 is the absolute owner in
possession of the agricultural land bearing
Sy.No.100/2 measuring 1 acre 30 guntas and
Sy.No.145 measuring 5 acres 24 guntas situated at
RFA NO.1548/2021 C/W
Bannikuppe village, Bidadi Hobli, Ramanagara Taluk
(for short 'the suit schedule property').
5. Defendant No.1 offered to sell the suit
schedule property and the plaintiff has agreed to
purchase jointly along with one V.Jayachandra @
Rs.6,20,000/- per acre for 7 acres 14 guntas for total
consideration of Rs.45,57,000/-. The plaintiff and
defendant No.1 entered into an agreement on
18.10.2004 and defendant No.1 received advance of
Rs.9,00,000/- in cash and cheque dated 02.11.2004
for Rs.5,00,000/-. Defendant No.1 encashed the said
cheque on 04.11.2004. It was agreed to pay balance
consideration of Rs.31,57,000/- at the time of
execution and registration of the sale deed within
three months from the date of agreement. It was also
agreed to deliver the possession in favour of plaintiff
free from all encumbrances on the date of execution
of sale deed.
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5.1. Two months after execution of the
agreement, i.e., in the last week of December 2004,
plaintiff approached defendant No.1 twice requesting
for execution and registration of the sale deed by
receiving the balance consideration and to hand over
vacant possession of the suit property with clear title
deeds. The plaintiff was always ready and willing to
perform his part of contract to pay balance of sale
consideration and to get the sale deed executed and
registered. Defendant No.1 has informed the plaintiff
that he has not yet acquired full title over the suit
schedule property, as there is a case pending before
the Assistant Commissioner, Ramanagara under
Section 79(A) of the Karnataka Land Reforms Act,
vide LRF (79) 21/1999-2000 and sought time assuring
that after acquiring full title, he would execute the
sale deed and hand over vacant possession. At the
time of execution of agreement, this aspect was not
disclosed to the plaintiff. Defendant No.1 entered into
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an agreement with the plaintiff misleading the said
aspect.
5.2. After consultation with his advocate, plaintiff
learnt he had three years time from the last date fixed
for execution of regular sale deed for seeking legal
remedy. Accordingly, he has granted six months' time
to defendant No.1 to perform his part of contract.
Even after one year, defendant No.1 did not come
forward with the marketable title to execute the sale
deed. Defendant No.1 has not shown any inclination
to perform his part of contract as and when the
plaintiff contacted him. Under such circumstances, the
plaintiff approached defendant No.1 in the month of
January and February 2006 requesting to perform his
part of contract, but he sought time. On 10.02.2006,
the plaintiff issued notice calling upon the defendant
No.1 to perform his part of contract, but he did not
receive the notice.
RFA NO.1548/2021 C/W
5.3. The plaintiff learnt that LRF case before the
Assistant Commissioner, Ramanagara was decided in
favour of defendant No.1. After getting the RTC and
other relevant records, defendant No.1 was trying to
alienate the suit property for the higher price to
defraud the rights of the plaintiff. Since
V.Jayachandra had relinquished his right in favour of
the present plaintiff, he has filed the present suit
seeking relief of specific performance.
5.4. By way of amendment, plaintiff has pleaded
that during the pendency of the suit, defendant No.1
had alienated the suit schedule property in favour of
one Y.Bhaskar for consideration of Rs.1,65,00,000/-
on 04.07.2013. Such alienation is hit by lis pendence
and not binding on the plaintiff. Later Y.Bhaskar was
impleaded as defendant No.2.
5.5. It is further pleaded that, the plaintiff has
filed the suit for specific performance at an earlier
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point of time in O.S.No.318/2006 against the
defendant No.1. Defendant No.1 filed I.A.No.IV for
rejection of the plaint for not properly describing the
title of the Company of the plaintiff. Said application
was rejected vide order dated 24.03.2010. Defendant
No.1 has challenged the said order before the High
Court in W.P.No.24070/2010. Vide order dated
26.09.2011, said writ petition was allowed and the
plaint was ordered to be rejected. The plaintiff has
challenged the same before the Hon'ble Apex Court in
S.L.P.No.5350/2012. The Hon'ble Apex Court
dismissed the said SLP on 30.04.2012 reserving
liberty to the plaintiff that dismissal of the SLP would
not prelude the plaintiff to institute a fresh suit.
Accordingly, the present suit is filed seeking relief of
mandatory injunction for specific performance. After
amendment and impleading defendant No.2, the
plaintiff has sought for additional relief that alienation
by defendant No.1 in favour of defendant No.2 on
RFA NO.1548/2021 C/W
04.07.2013 is hit by lis pendens and not binding on
the plaintiff. Alternatively, the plaintiff has also
sought for a direction against the defendant No.1 to
return the advance amount of Rs.14,00,000/- with
interest @ 12% per annum.
6. It is the case of the plaintiff in
O.S.No.308/2012, defendant No.1 is the absolute
owner in possession of the agricultural land bearing
Sy.No.100/1 measuring 1 acre 15 guntas, Sy.No.147
measuring 4 acres and Sy.No.158 measuring 2 acres
15 guntas situated at Bannikuppe village, Bidadi Hobli,
Ramanagara Taluk (for short 'the suit schedule
property').
6.1. Defendant No.1 offered to sell the suit
schedule property and the plaintiff has agreed to
purchase jointly along with one V.Jayachandra @
Rs.6,20,000/- per acre for total consideration of
Rs.48,05,000/-. The plaintiff and defendant No.1
RFA NO.1548/2021 C/W
entered into an agreement on 18.10.2004 and
defendant No.1 received an advance of Rs.6,00,000/-
in cash and cheque dated 02.11.2004 for
Rs.7,00,000/-. Defendant No.1 encashed the said
cheque on 04.11.2004. It was agreed to pay balance
consideration of Rs.35,05,000/- to defendant No.1 at
the time of execution and registration of the regular
sale deed within three months from the date of
agreement.
6.2. It is further pleaded that, the plaintiff has
filed the suit for specific performance at an earlier
point of time in O.S.No.322/2006 against defendant
No.1. Defendant No.1 filed I.A.No.IV for rejection of
the plant for not properly describing the title of the
Company of the plaintiff. Said application was
rejected vide order dated 24.03.2010. Defendant
No.1 has challenged the said order before the High
Court in W.P.No.24071/2010. Vide order dated
26.09.2011, said writ petition was allowed and the
RFA NO.1548/2021 C/W
plaint was ordered to be rejected. The plaintiff has
challenged the same before the Hon'ble Apex Court in
S.L.P.No.5350/2012. The Hon'ble Apex Court
dismissed the said SLP on 30.04.2012 reserving
liberty to the plaintiff that dismissal of the SLP will not
prelude the plaintiff to institute a fresh suit.
Accordingly, the present suit is filed seeking relief of
mandatory injunction for specific performance against
the defendants for execution of the registered sale
deed by receiving balance consideration of
Rs.35,05,000/- and to deliver possession of the
property. After amendment of the plaint, regarding
alienation in favour of defendant No.2, after
impleading defendant No.2 to the suit, he has sought
for the additional relief that alienation by defendant
No.1 in favour of defendant No.2 on 04.07.2013 is hit
by lis pendens and not binding on the plaintiff.
Alternatively, the plaintiff has also sought for direction
RFA NO.1548/2021 C/W
to defendant No.1 to repay the advance amount of
Rs.13,00,000/- with interest @ 12% per annum.
7. Since other pleadings urged in both suits are
identical, in order to avoid repetition, let us proceed
further together.
8. Before the Trial Court, defendant No.1 though
contested both the suits in O.S.No.318/2006 and
O.S.No.322/2006, he remained exparte in the present
suits. Defendant No.2 alone resisted both suits by
filing written statement interalia contending that he is
the owner of the suit schedule property having
acquired through sale deed dated 04.07.2013 from
defendant No.1. Plaintiff has suppressed the material
facts and misled the Court. Both the suits are not
maintainable. The execution of the agreement dated
18.10.2004 by defendant No.1 in favour of plaintiff is
denied and also payment of part consideration of
RFA NO.1548/2021 C/W
Rs.14 lakhs and 13 lakhs respectively and sought for
dismissal of the suit.
9. On the basis of the above pleadings, the Trial
court has framed the following issues:
In O.S.No.310/2012:
"1. Whether the plaintiff company proves that,
the defendant legally entered into sale
agreement on 18-10-2004 with the plaintiff
company and agreed to sell the suit schedule
property for a valuable sale consideration of
Rs.45,57.000/- and received a sum of Rs.
14,00,000/- as advance amount?
2. Whether the plaintiff company further proves
that, it was always ready and willing to
perform its part of obligation under the
contract?
3. Whether the plaintiff company further proves
that, the defendant No. 1 failed to perform
his part of obligation under the contract?
4. Whether the plaintiff further proves that, sale
deed dated:04-07-2013 in favour of 2nd
defendant is hit by lis pendens and void in
law?
5. Whether the plaintiff is entitled for the
specific performance relief as sought for?
RFA NO.1548/2021 C/W
6. Whether the defendant No.2 proves that he is
a bonafide purchaser of suit schedule
property?
7. Whether the plaintiff in the alternative is
entitled for refund of Rs.14,00,000/- along
with the interest at the rate of 12% p.a.?
8. Whether the plaintiff is entitled for the relief
as sought for?
9. What order or decree?"
10. In O.S.No.310/2012, on behalf of the
plaintiff, two witnesses are examined as PWs-1 and 2
and marked 26 documents as Ex.P1 to P26. On behalf
of defendants, defendant No.2 is examined as DW-1
and 13 documents are marked as Exs.D1 to D13.
11. In O.S.No.308/2012, on behalf of the
plaintiff, three witnesses are examined as PWs-1 to 3
and marked 32 documents as Ex.P1 to P32. On behalf
of defendants, defendant No.2 is examined as DW-1
and 10 documents are marked as Exs.D1 to D10.
12. The Trial Court in both suits, answered issue
No.1 in the affirmative, issue Nos.2, 4, 7 and 8 partly
RFA NO.1548/2021 C/W
in the affirmative, issue Nos.3, 5 and 6 in the
negative. While answering issue No.9, rejected the
relief for specific performance and directed the
defendant No.1 in both suits to refund advance
amount of Rs.14 lakhs and 13 lakhs respectively along
with interest @ 10% per annum from 17.01.2005 till
the date of realization. Aggrieved, the plaintiff has
filed the instant appeals on various grounds.
13. Heard the arguments of Sri Umesh
Moolimani, learned counsel for the plaintiff,
Sri.V.Srinivasan Raghavan, learned Senior Counsel
supported by Sri.H.S.Somnath, learned counsel for
defendant No.2. Notice to respondent No.1 is
dispensed with, since he was placed exparte before
the Trial Court.
14. It is the contention of the learned counsel for
the plaintiff that; evidence placed in proof of the
agreement is accepted by the Trial Court. Defendant
RFA NO.1548/2021 C/W
No.1 is under the obligation to furnish all relevant
records to complete the formalities of the execution
and registration of the sale deed. The LRF
proceedings pending before the Assistant
Commissioner, Ramanagar, was suppressed at the
time of execution of the agreement. After the title
dispute ended defendant No.1 avoided the plaintiff's
demand for execution of the sale deed.
14.1. Plaintiff is a Company having sufficient
funds. When demanded defendant No.1 to execute
the sale deed, he did not come forward after issuing
notice in the year 2006. Suits in O.S.No.318/2006
and O.S.No.322/2006 were filed. For the reason that
the suits were filed by the plaintiff's Managing Director
in his individual capacity, the plaint was rejected by
the High Court. The Hon'ble Apex Court permitted the
plaintiff to file the suit correctly. Accordingly, instant
suits are filed without any delay.
RFA NO.1548/2021 C/W
14.2. Though sufficient evidence was placed
explaining the readiness and willingness, the Trial
Court has failed to consider it. Defendant no.1 has
not contested the suit. The defendant No.2, the
purchaser pendente lite is only contesting the suit.
Under such circumstances, the Trial court ought to
have accepted the evidence and directed both
defendants to execute the sale deed by receiving the
balance sale consideration.
14.3. In support of his contentions, he has relied
upon the decision in Basavaraj -vs- Padmavathi
and Another1.
15. Per contra, learned Senior counsel appearing
on behalf of defendant No.2 has contended that the
plaintiff has not filed any suit specifically seeking
specific performance, but is seeking the order of
mandatory injunction. When the plaintiff is asking the
defendants to execute the sale deed, it is the foremost
AIR 2023 SC 282
RFA NO.1548/2021 C/W
duty of the plaintiff to establish that he was/is always
ready and willing to perform his part of contract.
Plaintiff failed to place any evidence in proof of it. The
plaintiff has not entered the witness box in both cases.
PW-1 as Power of Attorney has entered the witness
box. No evidence is placed to show that PW-1 is the
Director of the plaintiff/Company. Before the Trial
Court, on behalf of the plaintiff, there are no
documents, such as, balance sheet, income-tax
returns, bank statement or any other material to show
that the plaintiff/Company is/was or now holding any
money to pay balance sale consideration. The balance
consideration in both the suits comes to
Rs.66,62,000/-. PW-1 has admitted in the witness
box that the plaintiff was having about
Rs.30,00,000/-, which was not sufficient to pay
balance sale consideration for obtaining the sale deed.
15.1. It is also contended that apart from these
two suits, the plaintiff also filed another suit in
RFA NO.1548/2021 C/W
O.S.No.314/2012, which carries same consideration
and the balance sale consideration to be paid in that
suit is Rs.30 lakhs. In all 3 suits, balance sale
consideration comes around Rs.1 crore. The
plaintiff/Company was unable to show availability of
such money in its possession or any arrangement
made to pay the balance sale consideration.
15.2. Though PW-1 claims that the money was
in the house of the Managing Director of the
plaintiff/Company, no evidence is placed as the
Managing Director did not step into the witness box.
The Trial Court has rightly observed all these aspects
viz., the plaintiff without having sufficient money on
one or the other pretext dragged on to perform his
part of contract and committed default. A person not
ready and willing to perform his part of contract is not
entitled to claim relief of specific performance. The
Trial Court has rightly granted the alternate prayer of
the plaintiff for refund with interest.
RFA NO.1548/2021 C/W
15.3. The plaintiff has taken refund of balance
consideration in O.S.No.314/2012. Instead of
receiving the balance consideration in these two cases
in order to make wrongful gain is pretending to
prosecute these appeals. The plaintiff cannot be
allowed to blow hot and cold in different cases.
15.4. It is further contended that the agreement
came into existence on 18.10.2004. The suits filed
are in the year 2006 not by the plaintiff as the
agreement was in the name of the plaintiff/Company.
One Mr.C.P.Yogeshwar has filed these suits in his
personal capacity without any legal right. The
defendant no.1 has contested the said suits by filing
an application under Order VII Rule 11 of CPC seeking
rejection of the plaint. As the Trial Court has rejected
the said applications, it has been challenged before
this court. Vide order referred supra, this Court
allowed the application and rejected the plaint.
Mr.C.P.Yogeshwar has assailed the same before the
RFA NO.1548/2021 C/W
Hon'ble Apex Court and withdrawn the appeal
enabling the plaintiff to file the suit since in the
previous suits, plaintiff was not a party. Withdrawal
of SLP will not create a new cause of action for the
plaintiff to file the suit in the year 2012.
15.5. The suit ought to have been filed by the
plaintiff within three years of 18.10.2004 whereas the
suit filed after five years is barred by time. The
benefit of Section 14 of the Limitation Act is not
available to the plaintiff and he supported the
impugned judgment.
15.6. To buttress his arguments, he has relied
upon the decisions in:
i) U.N.Krishnamurthy (since deceased) Thr. LRs.
-vs- A.M.Krishnamurthy 2;
ii) Sri Senniyappan -vs- M.P.Nanda Kumar and
Others 3;
iii) Sri Dilip Bafna -vs- K.S.Vasudeva4.
2022 SCC Online SCC 840
R.F.A.No.6/2014 (SP) DD 16.06.2023
R.F.A.No.1589/2015 (SP) DD 15.03.2016
RFA NO.1548/2021 C/W
iv) Ram Awadh (dead) by LRs and Others -vs-
Achhaibar Debey and Another5;
v) Kadupugotla Varalakshmi -vs- Vudagiri
Venkata Rao and Others6.
16. We have given our anxious consideration to
the arguments addressed on behalf of both parties
and perused the records.
17. The points that arise for our consideration is:
(i) Whether the suit is in time?
(ii) Whether the plaintiff was/is always ready
and willing to perform his part of contract?
(iii) Whether the impugned judgment calls
interference?
Reg.Point No.(i):
18. The agreement of sale between the plaintiff
and defendant no.1 for sale of suit schedule property
on 18.10.2004 is not in dispute. The original
agreements are made available before the Court.
(2000) 2 SCC 428
2021 SCC ONLINE SC 365
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There is no bar for perusal of the said documents as
they are undisputed documents. In both the suits, the
terms of the agreement are identical except change of
name of defendant No.1 and also the suit schedule
property.
19. As per the terms of the agreement, time is
contemplated as three months from the date of
agreement and it is specifically agreed that the time is
essence of the contract. The contention of the plaintiff
is that defendant No.1 was approached twice in the
month of December 2004, asking him to execute the
sale deed. Plaintiff was informed about the LRF
proceedings before the Assistant Commissioner,
Ramanagara, due to which, the plaintiff waited for
completion of the LRF proceedings. That means to
say, the period of three months, which is agreed
under the agreement, as essence of contract has been
given up by the plaintiff.
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20. The earlier suit filed by Mr.C.P.Yogeshwar as
the Managing Director of M/s.Megacity Developers and
Builders Limited is not in dispute. The applications
filed by defendant No.1 in all the three suits under
Order VII Rule 11 of CPC were rejected by the Trial
Court. Same was challenged before this Court in
W.P.No.24069/2010 and connected matters. This
Court while observing that the suit was presented by
Mr.C.P.Yogeshwar in his personal capacity as the
Managing Director of M/s.Megacity Developers &
Builders Limited, whereas the agreement is between
defendant No.1 and M/s.Megacity Developers &
Builders Limited, he cannot prosecute the suit in his
individual capacity. Accordingly, the said applications
were allowed and plaints came to be rejected. Before
the Hon'ble Apex Court while dismissing the SLPs,
observation made, which thus reads as:
"Special Leave Petitions are dismissed. However
this will not prelude the Company to institute fresh
suit for the redressal of its grievance."
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21. The legal right of Mr.C.P.Yogeshwar to
institute the suit seeking specific performance against
defendant No.1 in his individual capacity has reached
the finality before the Hon'ble Apex Court and liberty
is given to the plaintiff/Company to file the suit for its
redressal shows the cause of action for the
plaintiff/Company to file suit shall be 3 years 3
months from the date of agreement and not in the
year 2012.
22. Copies of notices relied upon by the plaintiff
refer the date 10.02.2006 issued to defendant No.1 by
Sri.C.P.Yogeshwar and Sri.V.Jayachandra as Managing
Director and Director in their individual capacity. No
notice of demand calling upon the defendant No.1 was
issued on behalf of the Company. Thus, without
notice by the plaintiff, the suit is filed by the plaintiff
in the year 2012.
23. On a careful evaluation of the oral and
documentary evidence, it is pertinent to note that PW-
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1 though claims that he was the Director of the
plaintiff/Company, the Memorandum and Articles of
Association placed on record does not point out that
he was the Director in the year when the said
document was subscribed. No material is placed on
record to show that PW-1 was one of the Directors of
the plaintiff/Company on the date he has filed the suit
in the year 2006 or in the year 2012. He is
representing Sri C.P.Yogeshwar in his individual
capacity as Power of Attorney Holder and is not
representing the plaintiff/Company.
24. In view of the above, M/s.Megacity
Developers & Builders Limited could institute fresh suit
for redressal of its grievance. But as rightly
contended by the learned counsel for defendant No.2,
the Hon'ble Apex Court did not save the period of
limitation in favour of M/s.Megacity Developers.
Under such circumstances, the plaintiff has to explain
that the suit is filed within time. The agreement is
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dated 18.10.2004, the suit is filed in the year 2012
after lapse of eight years. The period prescribed for
performance of contract is three years and three
months as agreed. Section 14 of Limitation Act is not
applicable to save the limitation. The suit ought to
have been filed within three years three months from
the date of agreement whereas, the suit filed in the
year 2012 is hopelessly barred by time. Accordingly,
Point No.(i) is answered.
Reg.Point No.(ii):
25. PW-1/P.Mahadevaiah, the Power of Attorney
Holder of Mr.C.P.Yogeshwar has given evidence before
the Trial Court. He has produced the said Special
Power of Attorney marked as Ex.P2 in
O.S.No.308/2012. The Special Power of Attorney is
not executed by M/s.Megacity Developers & Builders
Limited, but same is the Power of Attorney relied
while presenting three suits in the year 2006. It goes
to show PW-1 has given evidence before the Court as
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Power of Attorney Holder of Mr.C.P.Yogehwar in his
personal capacity and not as a Power of Attorney
Holder of the Company. Then PW-1 cannot represent
the plaintiff, but he can only be treated as a one of
witness to the plaintiff.
26. Keeping that apart, if the evidence of PW-1
is appreciated, it is pertinent to note that during the
course of cross-examination, PW-1 has admitted that
the balance outstanding available with the
plaintiff/Company was Rs.1 Crore in the year 2004.
In the year 2006, the Bank balance of the Company
was Rs.50 Lakhs and in the year 2012, it was Rs.30
Lakhs. The suits are filed in the year 2006, even if it
is taken into consideration that the plaintiff/Company
is required to pay around Rs.1 Crore to defendant
No.1 in all the three suits, but it was holding only
Rs.50 Lakhs in its account. In the year 2012, the
liability on the plaintiff/Company to pay has not
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changed, but it was having only a sum of Rs.30 Lakhs
in its account.
27. The argument of the learned counsel for the
plaintiff is that the plaintiff being the Company having
Banking transaction and it was having capacity to
generate the balance of sale consideration once the
defendant No.1 came forward to execute the sale
deed. In order to substantiate this contention, the
plaintiff is required to place the material before the
Court which are all Banks records, the
plaintiff/Company was dealing with. Which bank had
agreed to lend money for purchase of the suit
schedule property or any cash/credit facility made
available for immediate withdrawal of balance
consideration of Rs.1 Crore to be paid to defendant
No.1 either in the year 2006 or in the year 2012 is not
forthcoming.
28. On behalf of the plaintiff/Company, there is
no evidence which speaks that the plaintiff was ready
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and willing to perform its part of contract. On the
other hand, PW-1, who is the Power of Attorney
Holder of Mr.C.P.Yogeshwar, in his individual capacity
comes before the Court and states on oath that on the
date of filing of the present suits, the amount
available in the account of the plaintiff/Company was
only Rs.30 lakhs as against Rs.1 Crore to be paid to
defendant No.1 in all the three suits. This clearly
shows that as on the date of suit, plaintiff had no
sufficient money to pay part consideration. Before
filing the suit, no notice was issued to defendant No.1
expressing ready and willingness of the
plaintiff/Company to perform its part of contract or
any part consideration so offered to defendant No.1
for performing their part of execution of the sale deed.
29. It is interesting to note that the agreement
was in the year 2004, suits were filed in the year
2012, now we are dealing the matter in the year
2024, 19 years after the date of agreement. As
RFA NO.1548/2021 C/W
rightly argued by the learned Senior Counsel, the
plaintiff/Company cannot make defendant No.1 to
wait for two decades to perform his part of contract as
the prices have escalated phenomenally in the recent
period.
30. In Basavaraj's case (supra), the Hon'ble
Apex Court at para-6.2 has held that, no adverse
inference can be drawn against the plaintiff for not
producing the Bank Passbook to hold that the plaintiff
was not ready and willing to perform his part of
agreement. It is further held that unless the plaintiff
was called upon to produce the Passbook either by the
defendant or the Court orders him to do so, no
adverse inference can be drawn. Here in this case,
there is no such scenario as PW-1 himself has
admitted in the cross-examination on oath that on the
date of filing of the suits in the year 2012, money that
was available in the account of the plaintiff/Company
RFA NO.1548/2021 C/W
was only Rs.30 lakhs. Hence, said principles will not
aid the plaintiff.
31. In U.N.Krishnamurthy's case (supra), the
Hon'ble Apex Court has elaborately defined the
concept of 'readiness and willingness' where the
plaintiff's balance sheet shows that he did not have
sufficient funds to discharge as part of contract.
Subsequent deposit of balance consideration after
lapse of seven years would not establish his readiness
to perform his part of contract. Para-47 and 48 thus,
reads:
"47. In this case, the Respondent Plaintiff
has failed to discharge his duty to prove his
readiness as well as willingness to perform his part
of the contract, by adducing cogent evidence.
Acceptable evidence has not been placed on record
to prove his readiness and willingness. Further, it is
clear from the Respondent Plaintiff's balance sheet
that he did not have sufficient funds to discharge
his part of contract in March 2003. Making
subsequent deposit of balance consideration after
lapse of seven years would not establish the
Respondent Plaintiff's readiness to discharge his
RFA NO.1548/2021 C/W
part of contract. Reliance may be placed on Umabai
v. Nilkanth Dhondiba Chavan (supra) where this
Court speaking through Justice SB Sinha held that
deposit of amount in court is not enough to arrive
at conclusion that Plaintiff was ready and willing to
perform his part of contract. Deposit in court would
not establish Plaintiff's readiness and willingness
within meaning of section 16(c) of Specific Relief
Act. The relevant part of the judgment is
reproduced below: - "45. ...Deposit of any amount
in the court at the appellate stage by the plaintiffs
by itself would not establish their readiness and
willingness to perform their part of the contract
within the meaning of Section 16(c) of the Specific
Relief Act..."
48. It is, therefore, patently clear that the
Respondent Plaintiff has failed to prove his
readiness to perform his part of contract from the
22 date of execution of the agreement till date of
decree, which is a condition precedent for grant of
relief of specific performance. This Court finds that
the Respondent Plaintiff was not entitled to the
relief of specific performance."
32. A Co-ordinate Bench of this Court in Sri
Senniyappan's case (supra) one among us being
parties in the said Bench has referred to the decision
RFA NO.1548/2021 C/W
in Basavaraj -vs- Padmavathi and also
U.N.Krishnamurthy's case and held that readiness
and willingness to perform his part of contract is upon
the plaintiff. The plaintiff is required to adduce
evidence either oral and documentary to demonstrate
that he was ready and willing to pay balance sale
consideration in order to complete the sale
transaction.
33. In the factual scenario of the instant case,
the plaintiff though pleaded that he is ready and
willing to perform his part of contract, in view of the
evidence of PW-1 that the plaintiff at the time of filing
of the suit was having only a sum of Rs.30 lakhs in its
account as against the required around Rs.1 crore
demonstrates that the plaintiff had no funds to
perform his part of contract. The contention of the
plaintiff that he was always ready and willing to
perform his part of contract remained an allegation on
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paper. Accordingly, point No.(ii) is answered against
the plaintiff.
Reg.Point No.(iii):
34. We have carefully perused the impugned
judgment. The Trial Court has considered each and
every fact pleaded by plaintiff, oral and documentary
evidence and recorded well reasoned judgment that
as on the date of the suit, the plaintiff did not have
sufficient funds, that there was no evidence to accept
his readiness and willingness to perform his part of
contract and accordingly, recorded adverse finding
against the plaintiff.
35. The last but not the least contention of the
plaintiff that defendant No.1 has not contested the
suit, defendant No.2, purchaser pendente lite only
contesting the suit and that the Trial Court has
committed error in rejecting the evidence of the
plaintiff is answered by the Hon'ble Apex Court in
RFA NO.1548/2021 C/W
Ram Awadh's case and Kadupugotla
Varalakshmi's case (supra) that defendant No.2
though a purchaser lis pendens, on purchase of the
property, as defendant No.2 had stepped into the
shoes of defendant No.1. In view of absence of
readiness and willing to perform his part of contract,
the plaintiff has lost right of enforcement of the
contract by virtue of bar of limitation.
36. It is interesting to note that when earlier
three suits were filed in the year 2006, defendant
No.1 has contested the suit by filing the written
statement. At his instance, application came to be
filed seeking rejection of the plaint. The plaint filed by
Sri.C.P.Yogeshwar in his individual capacity came to
be rejected by this Court confirmed by the Hon'ble
Apex Court. Hence, we do not find any force in such
submission of learned counsel for the plaintiff that the
contest made by defendant no.2 is inconsequential to
the claim of the plaintiff and the Court is required to
RFA NO.1548/2021 C/W
accept blindly the evidence of the plaintiff exparte as
against both the defendants.
37. The plaintiff, in the alternative has sought for
refund of advance money. The Trial Court even
though recorded that the plaintiff is not entitled for
refund of money has exercised its discretion by
ordering for refund with interest which is not
challenged by the defendants. As the suit is barred by
time, when the plaintiff is not entitled to recover the
advance money, the Trial Court has moulded the relief
protecting the interest of the plaintiff/Company.
38. Thus, in view of our finding on point Nos.(i)
to (iii) in view of the plaintiff having been adequately
compensated by order of refund of advance sale
consideration with interest. We find no ground to
interfere in this appeal.
39. Hence, both the appeals are devoid of
merits. In the result, the following:
RFA NO.1548/2021 C/W
ORDER
(i) Both the appeals are dismissed with
costs.
(ii) The impugned judgments and decree
in both suits are hereby confirmed.
(iii) The defendants are directed to
deposit the advance sale
consideration with interest before the
Trial Court as ordered in the
impugned judgment within 4 weeks
from today.
Sd/-
CHIEF JUSTICE
Sd/-
JUDGE
KNM/-
